<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, 2000
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
TNR TECHNICAL, INC.
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(Exact name of Registrant as specified in its charter)
New York 11-2565202
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(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
301 Central Park Drive
Sanford, Florida 32771
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code: (407) 321-3011
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None
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(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 ___.
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259,688 Common Shares, $.02 par value were issued and outstanding at April 30,
2000.
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TNR TECHNICAL, INC.
Index
Page
Number
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets
April 30, 2000 (Unaudited)
and July 31, 1999 3-4
Statements of Operations
Three and nine months ended
April 30, 2000 (Unaudited) and
April 30, 1999 (Unaudited) 5
Statements of Cash Flows
Nine months ended
April 30, 2000 (Unaudited) and
April 30, 1999 (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 10
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TNR TECHNICAL, INC.
Balance Sheets
Assets
<TABLE>
<CAPTION>
April 30, 2000
July 31, 1999 (Unaudited)
------------- --------------
Current assets:
<S> <C> <C>
Cash and cash equivalents $1,075,161 1,121,802
Accounts receivable - trade, less allowance for doubtful
accounts of $34,529 and $33,717 693,032 765,922
Income taxes receivable -- --
Inventories 1,062,043 1,498,932
Prepaid expenses and other current assets 7,410 21,482
Deferred income taxes 35,000 46,000
---------- ----------
Total current assets 2,872,646 3,454,138
Property and equipment, at cost, net of accumulated
depreciation and amortization 148,157 105,495
Deposits 13,612 13,427
---------- ----------
Total assets $3,034,415 3,573,060
========== ==========
</TABLE>
See accompanying notes to financial statements.
3
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TNR TECHNICAL, INC.
Balance Sheets
Liabilities and Shareholders' Equity
<TABLE>
<CAPTION>
April 30, 2000
July 31, 1999 (Unaudited)
------------- --------------
<S> <C> <C>
Current liabilities:
Accounts payable $ 211,346 222,974
Accrued expenses 108,714 169,158
Income taxes payable 110,000 164,000
Current installments of note payable 12,249 8,541
----------- -----------
Total current liabilities 442,309 564,673
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Note payable, excluding current installments 5,390 --
----------- -----------
Total liabilities 447,699 564,673
----------- -----------
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 142,956 572,205
Treasury stock - 40,663 and 41,983 shares (202,273) (209,851)
----------- -----------
Total shareholders' equity 2,586,716 3,008,387
----------- -----------
$ 3,034,415 3,573,060
=========== ===========
</TABLE>
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,
2000 1999 2000 1999
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues:
Net sales $ 1,961,248 1,623,471 6,155,342 4,452,327
----------- ----------- ----------- -----------
Cost and expenses:
Cost of goods sold 1,452,289 1,160,397 4,508,981 3,218,581
Selling, general and administrative 321,336 286,550 967,105 824,984
----------- ----------- ----------- -----------
1,773,625 1,446,947 5,476,086 4,043,565
----------- ----------- ----------- -----------
Operating income 187,623 176,524 679,256 408,762
Non-operating revenue (expense):
Interest income 16,718 10,942 46,342 28,680
Other (15,349) (3,031) (15,349) (8,267)
----------- ----------- ----------- -----------
Income before income taxes 188,992 184,435 710,249 429,175
Provision for income taxes 78,000 73,000 281,000 164,000
----------- ----------- ----------- -----------
Net income 110,992 111,435 429,249 265,175
=========== =========== =========== ===========
Net income per share 0.43 0.43 1.65 1.01
=========== =========== =========== ===========
Weighted average number of shares
outstanding 259,692 261,288 260,300 261,647
=========== =========== =========== ===========
</TABLE>
See accompanying notes to financial statements
5
<PAGE>
TNR TECHNICAL, INC.
Statements of Cash Flows
<TABLE>
<CAPTION>
Nine Months Ended
April 30,
2000 1999
(Unaudited) (Unaudited)
----------- -----------
Cash flows from operating activities:
<S> <C> <C>
Net income $ 429,249 265,175
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 30,135 39,284
Deferred income taxes (11,000) 67,000
Loss on disposition of property and equipment 14,640 --
Changes in operating assets and liabilities:
Sale of short term investments -- 217,214
Purchases of short term investments -- (50,033)
Accounts receivable (72,890) (18,312)
Deposits 185 144
Inventories (436,889) (79,707)
Prepaid expenses and other assets (14,072) 7,775
Accounts payable and accrued expenses 72,072 80,593
Income taxes payable 54,000 56,963
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Net cash provided by (used in) operating activities 65,430 586,096
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Cash flows from investing activities:
Proceeds from sale of property and equipment 6,000 --
Purchase of treasury stock (7,578) (5,369)
Purchase of property and equipment (8,113) (6,281)
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Net cash provided by (used in) investing activities (9,691) (11,650)
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Cash flows from financing activities:
Payment of principal on note payable (9,098) (8,422)
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Net cash provided by (used in) financing activities (9,098) (8,422)
Increase in cash and cash equivalents 46,641 566,024
Cash and cash equivalents - beginning of period 1,075,161 597,683
----------- -----------
Cash and cash equivalents - end of period 1,121,802 1,163,707
=========== ===========
</TABLE>
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, 2000, and results
of operations and cash flows for the three and nine month periods ended
April 30, 2000 and 1999. 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, 2000 and 1999, no customer
accounted for more than 10% of total revenue.
(3) Inventories
Inventories consist of the following:
April 30, 2000
July 31, 1999 (Unaudited)
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Finished goods $1,031,244 1,438,975
Purchased parts and materials 30,799 59,957
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$1,062,043 1,498,932
========== ==========
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 $2,889,465 at April 30, 2000 as compared to
$2,430,337 at July 31, 1999. Cash and short term investments amounted to
$1,121,802 at April 30, 2000 as compared to $1,075,161 at July 31, 1999. 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, 2000 and 1999 was $65,430 and $586,096, respectively. For
the nine months ended April 30, 1999, cash was provided by operating activities
as a result of the Company's net income, sale of short-term investments and
increases in income taxes and accounts payable and accrued expenses, partially
offset by purchases of short-term investments and increases in inventories and
accounts receivable. For the nine months ended April 30, 2000, cash was provided
by operating activities as a result of the Company's net income and increases in
accounts payable and accrued expenses partially offset by increases in
inventories and accounts receivable. During the nine months ended April 30, 2000
and 1999, cash was used in investing activities to acquire additional 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 2000
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 as of April 30, 2000.
Results of Operations
Net sales for the three months ended April 30, 2000 were $1,961,248, an
increase of $337,777 or approximately 21% from the comparable period of the
prior year. Net sales for the nine months ended April 30, 2000 were $6,155,342,
an increase of $1,703,015 or approximately 38% from the comparable period of the
prior year. The increases in sales for the three and nine months ended April
30,2000 was primarily due to increases in sales to existing and new customers.
During the three months ended April 30, 2000 and April 30, 1999, no customer
accounted for more than 10% of total revenues. The Company's gross margin
decreased slightly for the three months and nine months ended April 30, 2000 and
April 30, 1999 due to differences in the mix of products sold in these periods.
Operating (selling, general and administrative) expenses when expressed
as a percentage of net sales for the three months ended April 30, 2000 was 16.4%
as compared to 17.7% for the comparable period of the prior year. Operating
(selling, general and administrative) expenses when expressed as a percentage of
net sales for the nine months ended April 30, 2000 was 15.7% as compared to
18.5% for the comparable period of the prior year. During the past three years,
the Company did not charge its operations with any research and development
costs.
8
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Net income for the three months ended April 30, 2000 was $110,992 as
compared to $111,435 for the comparable period of the prior year. Net income for
the nine months ended April 30, 2000 was $429,249 as compared to $265,175 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 the 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 Common Stock from odd lot holders (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.
9
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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, 2000, no report
on Form 8-K was filed or required to be filed.
10
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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.
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(Registrant)
Dated: June 12, 2000
By /s/ Jerrold Lazarus
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Jerrold Lazarus (Chairman of the Board,
Chief Executive Officer, Chief Accounting
and Financial Officer and Treasurer)
11
