SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) May 6, 1996
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Newcor, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 1-5985 38-0865770
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(State or other (Commission (IRS Employer
jurisdiction) File Number) Identification No.)
1825 S. Woodward Avenue, Suite 240, Bloomfield Hills, MI 48302
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (810) 253-2400
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(Former name or former address, if changed since last report)
ITEM 2 Acquisition or Disposition of Assets.
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On May 6, 1996, Newcor sold the business and certain assets of its
Wilson Automation division (Wilson) to ABB Flexible Automation, a unit
of ABB (Asea Brown Boveri). Wilson designs and manufactures engine,
transmission, and axle assembly systems. All receivables, the land and
building, and certain other liabilities were retained by Newcor. The
purchase price approximated the net asset value of the assets purchased
and was determined through arm's length negotiations.
ITEM 7 Financial Statements and Exhibits.
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Item 7.b. Pro forma financial information.
NEWCOR, INC.
PRO FORMA CONDENSED CONSOLIDATED INCOME STATEMENT (UNAUDITED)
FOR THE QUARTER ENDED JANUARY 31, 1996
(Amounts in thousands, except per share amounts)
Sale of
Wilson Pro-Forma
Newcor, Inc. Automation Consolidated
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Sales $ 28,343 $ (5,083) (a) $ 23,260
Cost of sales 23,050 (5,125) (a) 17,925
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Gross margin 5,293 42 5,335
SG&A expenses 4,233 (1,063) (a) 3,170
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Operating income 1,060 1,105 2,165
Other income (expense):
Interest expense (482) 64 (b) (418)
Other 152 80 (c) 232
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Income before income taxes 730 1,249 1,979
Provision for income taxes 255 437 (d) 692
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Net income $ 475 $ 812 $ 1,287
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Amounts per share of common stock:
Net income $ 0.10 $ 0.27
Dividends $ 0.05 $ 0.05
Weighted average common shares outstanding for the period: 4,679.
See notes to unaudited pro-forma
condensed consolidated financial statements
NEWCOR, INC.
PRO FORMA CONDENSED CONSOLIDATED INCOME STATEMENT (UNAUDITED)
FOR THE YEAR ENDED OCTOBER 31, 1995
(Amounts in thousands, except per share amounts)
Sale of
Wilson Pro-Forma
Newcor, Inc. Automation Consolidated
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Sales $ 116,630 $ (26,457) (a) $ 90,173
Cost of sales 98,304 (24,749) (a) 73,555
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Gross margin 18,326 (1,708) 16,618
SG&A expenses 15,468 (3,666) (a) 11,802
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Operating income 2,858 1,958 4,816
Other income (expense):
Interest expense (1,910) 406 (b) (1,504)
Other 310 320 (c) 630
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Income before income taxes 1,258 2,684 3,942
Provision for income taxes 377 962 (d) 1,339
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Net income $ 881 $ 1,722 $ 2,603
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Amounts per share of common stock:
Net income $ 0.19 $ 0.56
Dividends $ 0.20 $ 0.20
Weighted average common shares outstanding for the period: 4,679.
See notes to unaudited pro-forma
condensed consolidated financial statements
NEWCOR, INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
AS OF JANUARY 31, 1996
(Amounts in thousands)
Sale of
Wilson Pro-Forma
Newcor, Inc. Automation Consolidated
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ASSETS:
Current Assets:
Cash and equivalents $ 24 $ - $ 24
Accounts receivable 25,593 - 25,593
Costs and estimated earnings
in excess of related billings
on uncompleted contracts 5,858 (2,685) (a) 3,173
Inventories 6,016 - 6,016
Other current assets 2,177 1,800 (b) 3,977
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Total current assets 39,668 (885) 38,783
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Property, plant & equipment 47,286 (2,742) (a) 44,544
Accumulated depreciation 20,669 (1,975) (a) 18,694
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Net PP&E 26,617 (767) 25,850
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Other long-term assets 16,120 (266) (c) 15,854
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TOTAL ASSETS $ 82,405 $ (1,918) $ 80,487
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LIABILITIES AND SHAREHOLDERS' EQUITY:
Current liabilities:
Accounts payable $ 8,017 $ (1,679) (a) $ 6,338
Other accrued liabilities 7,648 3,000 (d) 10,648
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Total current liabilities 15,665 1,321 16,986
Long-term debt 31,400 (739) (g) 30,661
Postretirement benefits & other 9,190 1,000 (e) 10,190
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Total liabilities 56,255 1,582 57,837
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Shareholders' equity:
Common stock 4,679 - 4,679
Capital in excess of par 395 - 395
Unfunded pension liability (536) - (536)
Retained earnings 21,612 (3,500) (f) 18,112
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Total shareholders' equity 26,150 (3,500) 22,650
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TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 82,405 $ (1,918) $ 80,487
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See notes to unaudited pro-forma
condensed consolidated financial statements
NEWCOR, INC.
NOTES TO UNAUDITED PRO FORMA
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
A. BASIS OF COMBINATION.
On May 6, 1996, Newcor sold the business and certain assets of its
Wilson Automation division to ABB Flexible Automation. All
receivables, the land and building, and certain other liabilities were
retained by Newcor. The building is being leased to ABB. The pro
forma condensed consolidated financial statements show the income
statement and balance sheet amounts that Newcor originally reported in
the applicable 10-K and 10-Q, the effect of the sale of the Wilson
Automation division, and the resulting pro forma amounts. Income
statement information is being provided for the first quarter of 1996
and the full year ended October 31, 1995 on the basis that Wilson was
sold as of the beginning of the period being presented. The balance
sheet information being provided is as of January 31, 1996 on the basis
that Wilson was sold on January 31, 1996.
B. PRO FORMA INCOME STATEMENT ADJUSTMENTS:
The following adjustments were made to the condensed consolidated
income statement to arrive at the pro forma income statement:
(a) To eliminate the results of operations at Wilson Automation.
(b) To eliminate a portion of consolidated interest expense. The
amount eliminated was determined by multiplying consolidated
interest expense by the portion of total net assets related
to Wilson Automation.
(c) To add the income related to leasing the building to ABB
Flexible Automation.
(d) To eliminate the tax effect of items (a) through (c).
C. PRO FORMA BALANCE SHEET ADJUSTMENTS:
The following adjustments were made to the condensed consolidated
balance sheet to arrive at the pro forma balance sheet:
(a) To eliminate the balance sheet items purchased by ABB
Flexible Automation.
(b) To record deferred federal income taxes related to the loss
on the sale of Wilson.
(c) To eliminate the net goodwill related to Wilson Automation.
(d) To record accruals for employee separation costs, anticipated
operating losses at Wilson between the measurement date
(March 31, 1996) and disposal date, and additional
liabilities related to contracts for which Newcor has
retained the responsibility and liabilities.
(e) To record additional reserve related to the curtailment of
the pension plan.
(f) To record the loss on the sale of Wilson.
(g) To reduce long-term debt by the net effect of items (a)
through (f).
Item 7.c. Exhibits:
None.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
Newcor, Inc.
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(Registrant)
Date May 21, 1996 /s/ John Garber
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John Garber
Vice President-Finance
