<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 October 31, 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, (407) 321-3011
including area code: --------------
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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259,283 Common Shares, $.02 par value were issued and outstanding at October 31,
2000.
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TNR TECHNICAL, INC.
Index
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets
October 31, 2000 (Unaudited)
and July 31, 2000 1
Statements of Operations
Three months ended
October 31, 2000 (Unaudited) and
October 31, 1999 (Unaudited) 2
Statements of Cash Flows
Three months ended
October 31, 2000 (Unaudited) and
October 31, 1999 (Unaudited) 3
Notes to Financial Statements (Unaudited) 4
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 5
PART II. OTHER INFORMATION 7
SIGNATURES 8
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TNR TECHNICAL, INC.
Balance Sheets
Assets
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<TABLE>
<CAPTION>
October 31, 2000
July 31, 2000 (Unaudited)
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<S> <C> <C>
Current assets:
Cash and cash equivalents $ 1,574,611 1,559,371
Accounts receivable - trade, less allowance for doubtful
accounts of $33,018 and $34,529 662,121 903,036
Inventories 1,239,665 1,114,900
Prepaid expenses and other current assets 10,392 8,012
Deferred income taxes 48,000 52,000
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Total current assets 3,534,789 3,637,319
Property and equipment, at cost, net of accumulated
depreciation and amortization 108,894 104,293
Deposits 19,632 16,997
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Total assets $ 3,663,315 3,758,609
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Liabilities and Shareholders' Equity
------------------------------------
Current liabilities:
Accounts payable $ 183,949 248,494
Accrued expenses 320,090 208,630
Income taxes payable 135,000 123,662
Note payable 5,390 --
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Total current liabilities 644,429 580,786
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Shareholders' equity:
Common stock - $.02 par value, authorized 500,000
shares; issued 301,581 shares 6,032 6,032
Additional paid in capital 2,640,001 2,640,001
Retained earnings 582,966 742,178
Treasury stock - 42,023 and 42,298 shares, respectively (210,113) (210,388)
----------- -----------
Total shareholders' equity 3,018,886 3,177,823
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$ 3,663,315 3,758,609
=========== ===========
</TABLE>
See accompanying notes to financial statements.
1
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TNR TECHNICAL, INC.
Statements of Operations
Three Months Ended
October 31,
2000 1999
(Unaudited) (Unaudited)
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Revenues:
Net sales $2,349,425 2,136,001
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Costs and expenses:
Cost of goods sold 1,793,427 1,541,215
Selling, general and administrative 314,528 320,389
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2,107,955 1,861,604
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Operating income 241,470 274,397
Non-operating revenue (expense):
Interest income 23,742 13,886
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Income before income taxes 265,212 288,283
Provision for income taxes 106,000 110,000
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Net income $ 159,212 178,283
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Net income per share $ 0.61 0.68
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Weighted average number of shares outstanding 259,489 260,879
========== ==========
See accompanying notes to financial statements.
2
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TNR TECHNICAL, INC.
Statements of Cash Flows
<TABLE>
<CAPTION>
Three Months Ended
October 31,
2000 1999
(Unaudited) (Unaudited)
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<S> <C> <C>
Cash flows from operating activities:
Net income $ 159,212 178,283
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 6,931 10,118
Deferred income taxes (4,000) --
Provision for bad debt 2,100 2,100
Changes in operating assets and liabilities:
Accounts receivable (243,015) (170,430)
Deposits 2,635 --
Inventories 124,765 46,490
Prepaid expenses and other assets 2,380 (10,743)
Income taxes payable (11,338) (5,000)
Accounts payable and accrued expenses (46,915) 119,047
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Net cash provided by (used in) operating activities (7,245) 169,865
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Cash flows from investing activities:
Purchase of property and equipment (2,330) (2,411)
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Net cash used in investing activities (2,330) (2,411)
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Cash flows from financing activities:
Purchase of treasury stock (275) (650)
Principal payments on note payable (5,390) (2,974)
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Net cash used in financing activities (5,665) (3,624)
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Increase (decrease) in cash and cash equivalents (15,240) 163,830
Cash and cash equivalents - beginning of period 1,574,611 1,075,161
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Cash and cash equivalents - end of period $ 1,559,371 1,238,991
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</TABLE>
See accompanying notes to financial statements.
3
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TNR TECHNICAL, INC.
Notes to Financial Statements
(1) Presentation of Unaudited Financial Statements
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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 necessary adjustments (consisting only
of normal recurring accruals) to present fairly the financial position as of
October 31, 2000, and results of operations and cash flows for the three
month periods ended October 31, 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
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During the three months ended October 31, 2000 and 1999, no customer
accounted for more than 10% of total revenue.
(3) Inventories
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Inventories consist of the following:
October 31, 2000
July 31, 2000 (Unaudited)
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Finished goods $1,196,277 1,070,304
Purchased parts and materials 43,388 44,596
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$1,239,665 1,114,900
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4
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Management's Discussion and Analysis of Financial Condition
and Results of Operations
Liquidity and Capital Resources
Working capital amounted to $3,056,533 at October 31, 2000 as compared
to $2,890,360 at July 31, 2000. Cash and short term investments amounted to
$1,559,371 at October 31, 2000 as compared to $1,574,611 at July 31, 2000. As
more fully described under the Company's statements of cash flows in the
accompanying financial statements, net cash was provided by operating activities
for the three months ended October 31, 1999. For this period, cash was provided
primarily due to the Company's net income and increases in accounts payable and
accrued expenses as well as decreases in inventories partially offset by
increases in accounts receivable. For the three months ended October 31, 2000,
cash was used in operating activities as a result of increases in accounts
receivable and decreases in payables partially offset by decreases in
inventories and the Company's net income. During the three months ended October
31, 2000 and 1999, cash was used in investing activities to purchase property
and equipment. During the three months ended October 31, 2000 and 1999, cash was
used in financing activities to make principal payments on a note payable and to
purchase treasury stock.
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 October 31, 2000.
Results of Operations
Net sales for the three months ended October 31, 2000 were $2,349,425,
an increase of $213,424 or approximately 10% from the comparable period of the
prior year. The increase in sales for the three months ended October 31,2000 was
primarily due to increases in sales to existing and new customers. During the
three months ended October 31, 2000 and 1999, no customer accounted for more
than 10% of total revenues. The Company's gross margin for the three months
ended October 31, 2000 decreased approximately 4% from the comparable period of
the prior year, due to changes in the product mix of sales.
Operating (selling, general and administrative) expenses when expressed
as a percentage of net sales for the three months ended October 31, 2000 was
approximately 13% as compared to approximately 15% 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.
Net income for the three months ended October 31, 2000 was $159,212 as
compared to $178,283 for the comparable period of the prior year.
5
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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.
6
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings: None
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Item 2. Changes in Securities: None
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Item 3. Defaults Upon Senior Securities: None
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Item 4. Submission of Matters to a Vote of Security Holders:
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During the quarter ended October 31, 2000, the Company did not
have any meeting of stockholders. However, on December 11, 2000, the Registrant
held its annual meeting of stockholders at which time the stockholders reelected
the incumbent six directors, namely, Jerrold Lazarus, Norman Thaw, Wayne Thaw,
Kathie Thaw, Mitchell Thaw and Patrick Hoscoe for a period of one year and until
their successors are elected and shall qualify.
Item 5. Other Information: None
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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 October 31, 2000, no
report on Form 8-K was filed or required to be filed.
7
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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: December 15, 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)
8
