<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended April 30, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to ________
Commission File Number: 0-13011
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TNR TECHNICAL, INC.
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(Exact name of Registrant as specified in its charter)
New York 11-2565202
- --------------------------- ---------------------------------
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
301 Central Park Drive
Sanford , Florida 32771
- ------------------------------ ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code: (407) 321-3011
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279 Douglas Avenue, Suite 1112, Altamonte Springs, FL 32714
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year
if changed since last report)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.
Yes x No .
---- ---
262,422 COMMON SHARES, $.0001 PAR VALUE WERE ISSUED AND OUTSTANDING AT APRIL 30,
1996.
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TNR TECHNICAL, INC.
INDEX
Page
Number
------
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets
April 30, 1996 (Unaudited) 3-4
and July 31, 1995
Statements of Operations
Three and Nine Months ended
April 30, 1996 and
April 30, 1995 (Unaudited) 5
Statements of Cash Flows
Nine Months ended April 30, 1996
and April 30, 1995 (Unaudited) 6
Notes to Financial Statements (Unaudited) 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 8-9
PART II. OTHER INFORMATION 9
SIGNATURES 10
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TNR TECHNICAL, INC.
BALANCE SHEETS
ASSETS
July 31, April 30,
1995 1996
(Unaudited)
-------------------------------
Current assets:
Cash and cash equivalents $ 100,298 441,035
Short-term investments 507,863 343,875
Accounts receivable - trade, less allowance
for doubtful accounts 380,302 406,121
Inventories 715,438 508,147
Prepaid expenses and other current assets 5,842 20,766
------------ ----------
Total current assets 1,709,743 1,719,944
Deferred income taxes 250,000 199,000
Property and equipment, at cost, net of
accumulated depreciation and amortization 56,877 52,186
Deposits 5,991 5,991
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$ 2,022,611 1,977,121
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---------- ----------
(Continued)
3
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TNR TECHNICAL, INC.
BALANCE SHEETS, CONTINUED
LIABILITIES AND SHAREHOLDERS' EQUITY
July 31, April 30,
1995 1996
(Unaudited)
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Current liabilities:
Accounts payable $ 220,038 58,299
Accrued expenses and taxes 48,157 36,310
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Total current liabilities 268,195 94,609
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Shareholders' equity:
Common stock - $.02 par value, authorized
500,000 shares; issued 301,581 shares 6,032 6,032
Additional paid in capital 2,640,001 2,640,001
Retained earnings (697,347) (569,251)
Treasury stock; 39,159 shares at cost (194,270) (194,270)
----------- -----------
Total shareholders' equity 1,754,416 1,882,512
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$ 2,022,611 1,977,121
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----------- -----------
See accompanying notes to financial statements.
4
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TNR TECHNICAL, INC.
STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
April 30, April 30,
1996 1995 1996 1995
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
-----------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues:
Net sales $ 942,930 989,845 2,825,678 2,694,218
Interest 6,721 10,357 21,666 25,861
---------- ---------- ----------- -----------
949,651 1,000,202 2,847,344 2,720,079
---------- ---------- ----------- -----------
Costs and expenses:
Cost of goods sold 685,587 739,576 2,058,048 2,020,007
Selling, general and administrative 193,358 190,825 600,300 598,068
---------- ---------- ----------- -----------
878,945 930,401 2,658,348 2,618,075
---------- ---------- ----------- -----------
Income before income taxes 70,706 69,801 188,996 102,004
Provision for income taxes 27,600 5,000 60,900 5,000
---------- ---------- ----------- -----------
Net income $ 43,106 64,801 128,096 97,004
---------- ---------- ----------- -----------
---------- ---------- ----------- -----------
Net income per common share $ .16 .25 .49 .37
---------- ---------- ----------- -----------
---------- ---------- ----------- -----------
Weighted average number of shares outstanding 262,419 262,419 262,419 262,419
---------- ---------- ----------- -----------
---------- ---------- ----------- -----------
</TABLE>
See accompanying notes to financial statements.
5
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TNR TECHNICAL, INC.
STATEMENTS OF CASH FLOWS
Nine Months Ended
April 30,
1996 1995
(Unaudited) (Unaudited)
-----------------------------
Cash flows from operating activities
Net income $ 128,096 97,004
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization 16,395 9,774
Deferred income taxes 51,000 -
Changes in operating assets
and liabilities:
Accounts receivable (25,819) (99,582)
Inventories 207,291 (114,251)
Prepaid expenses and other assets (14,924) 7,754
Accounts payable and accrued expenses (173,586) 138,526
----------- ----------
Net cash provided by operating activities 188,453 39,225
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Cash flows from investing activities
Reduction (increase) in short-term investments 163,988 (128,006)
Purchase of property and equipment (11,704) (28,472)
----------- ----------
Net cash provided by (used in)
investing activities 152,284 (156,478)
----------- ----------
Increase (decrease) in cash and cash 340,737 (117,253)
equivalents
Cash and cash equivalents - Beginning of period 100,298 353,804
----------- ----------
Cash and cash equivalents - End of period $ 441,035 236,551
----------- ----------
----------- ----------
See accompanying notes to financial statements.
6
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TNR TECHNICAL, INC.
NOTES TO FINANCIAL STATEMENTS
(1) PRESENTATION OF UNAUDITED FINANCIAL STATEMENTS
The unaudited financial statements have been prepared in accordance with
rules of the Securities and Exchange Commission and, therefore, do not
include all information and footnotes necessary for a fair presentation of
financial position, results of operations and cash flows, in conformity
with generally accepted accounting principles. The information furnished,
in the opinion of management, reflects all adjustments (consisting only of
normal recurring accruals) necessary to present fairly the financial
position as of April 30, 1996, and results of operations and cash flows for
the three and nine month periods ended April 30, 1996 and 1995. The results
of operations are not necessarily indicative of results which may be
expected for any other interim period or for the year as a whole.
(2) SALES TO MAJOR CUSTOMERS
During the nine months ended April 30, 1996 and 1995, no customer accounted
for more than 10% of total revenues.
7
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Management's Discussion and Analysis of Financial Condition
and Results of Operations
LIQUIDITY AND CAPITAL RESOURCES
Working capital amounted to $1,625,335 at April 30, 1996 as compared to
$1,441,548 at July 31, 1995. Cash and short term investments amounted to
$784,910 at April 30, 1996 as compared to $608,161 at July 31, 1995. As more
fully described under the Company's statements of cash flows in the accompanying
financial statements, net cash provided by operating activities for the nine
months ended April 30, 1996 and 1995 was $188,453 and $39,225, respectively.
For the nine months ended April 30, 1996, cash was provided by operating
activities due to the Company's net income and decreases in inventories
partially offset by increases in receivables and decreases in payables and
accrued expenses. For the nine months ended April 30, 1995, cash was provided
by operating activities due to the Company's net income and increases in
payables and accrued expenses partially offset by increases in accounts
receivables and inventories. During the nine months ended April 30, 1996, net
cash was provided by investing activities as a result of reductions in short-
term investments partially offset by purchases of property and equipment.
During the nine months ended April 30, 1995, net cash was used in investing
activities due to increases in short term investments and purchases of property
and equipment.
The Company's short term and long term liquidity needs have been satisfied
from internal sources including cash from operations and amounts available from
the Company's working capital. During the balance of fiscal 1996 and on a long
term basis, management expects this trend to continue. There are no material
commitments for capital expenditures or any long term credit arrangements.
RESULTS OF OPERATIONS
Net sales for the three months ended April 30, 1996 were $942,930 a
decrease of $46,915 or approximately 5% from the comparable period of the prior
year. Such decrease was due to decreaes in volume. During the nine months
ended April 30, 1996, net sales were $2,825,678, an increase of $131,460 or
approximately 5% from the comparable period of the prior year. Such increase
was due to increases in sales to existing and new customers. During the three
months ended April 30, 1996 and April 30, 1995, no customer accounted for more
than 10% of total revenues. The Company's gross margin for the three and nine
months ended April 30, 1996 increased by approximately 2% for each period as
compared to the comparable periods of the prior year due to changes in the mix
of product sales, increased prices and improved purchasing.
Operating (selling, general and administrative) expenses, when expressed as
a percentage of net sales increased approximately 1% for the three months ended
April 30, 1996 from the comparable period of the prior year due to decreased
sales with operating costs remaining relatively constant. Operating expenses,
when expressed as a percentage of net sales decreased approximately 1%
8
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for the nine months ended April 30, 1996 from the comparable period of the prior
year due to increased sales with operating costs remaining relatively constant.
During the past three years and the three months ended April 30, 1996, the
Company did not charge its operations with any research and development costs.
Net income for the three months ended April 30, 1996 was $43,106 as
compared to $64,801 for the comparable period of the prior year. Net income
for the nine months ended April 30, 1996 was $128,096 as compared to $97,004 for
the comparable period of the prior year.
Management of TNR Technical, Inc. has received a number of comments from
its odd lot stockholders regarding the costs associated with any sale of their
odd lots. Further, Management would like to reduce TNR's expense of maintaining
mailings to odd lot holders. Accordingly, TNR will from time-to-time privately
purchase from odd lot holders of its common stock, such odd lots (i.e. 99 shares
or less) from its stockholders of record on December 15, 1995 so long as such
purchases would not have the effect of reducing TNR's record holders to 500 or
less. The purchase price to be paid will be based upon the closing asked price
on the NASD electronic bulletin board of TNR's Common Stock for the preceding
trading day. Stockholders will not be permitted to breakup their stockholdings
into odd lots and stockholders or their legal representatives must affirm to TNR
that the odd lot shares submitted for payment represent the stockholder's entire
holdings and that such holdings do not exceed 99 shares. (This offer shall be
open to all odd lot beneficial holders even those held in street or nominee name
so long as the proper representations can be obtained satisfactory to TNR that
the shares are odd lot shares, were owned by the beneficial stockholder as of
December 15, 1995 and represent such stockholder's entire holdings of TNR).
This offer will not be valid in those states or jurisdictions where such offer
or sale would be unlawful.
PART II - OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS: None
Item 2. CHANGES IN SECURITIES: None
Item 3. DEFAULTS UPON SENIOR SECURITIES: None
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS:
None
Item 5. OTHER INFORMATION: None
Item 6. EXHIBITS AND REPORTS ON FORM 8-K:
(a) Exhibits
11 Earnings per share - included in the Statements
of Operations
27 Financial Data Schedule
(b) During the quarter ended April 30, 1996 no report on Form 8-K was
filed or required to be filed.
9
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TNR TECHNICAL, INC.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TNR TECHNICAL, INC.
----------------------------------
(Registrant)
Dated: June 14, 1996
/s/ Jerrold Lazarus
-----------------------------------
Jerrold Lazarus (Chairman of the
Board, Chief Executive Officer,
Chief Accounting and Financial
Officer and Treasurer)
10
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUL-31-1995
<PERIOD-END> APR-30-1996
<CASH> 784,910
<SECURITIES> 0
<RECEIVABLES> 415,271
<ALLOWANCES> 9,150
<INVENTORY> 508,147
<CURRENT-ASSETS> 1,719,944
<PP&E> 127,214
<DEPRECIATION> 75,028
<TOTAL-ASSETS> 1,977,121
<CURRENT-LIABILITIES> 94,609
<BONDS> 0
0
0
<COMMON> 6,032
<OTHER-SE> 1,876,480
<TOTAL-LIABILITY-AND-EQUITY> 1,977,121
<SALES> 2,825,678
<TOTAL-REVENUES> 2,847,344
<CGS> 2,058,048
<TOTAL-COSTS> 2,658,348
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 188,996
<INCOME-TAX> 60,900
<INCOME-CONTINUING> 128,096
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 128,096
<EPS-PRIMARY> .49
<EPS-DILUTED> .49
</TABLE>
