FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
February 28, 1998
For the quarterly period ended ...........................................
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ................... to ....................
0-11631
Commission File Number ..........
JUNO LIGHTING, INC.
..........................................................................
(Exact name of registrant as specified in its charter)
Incorporated in Delaware 36-2852993
..........................................................................
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1300 S. Wolf Road, Des Plaines, Illinois 60017-5065
..........................................................................
(Address of principal executive offices) (Zip Code)
847 - 827 - 9880
..........................................................................
(Registrant's telephone number, including area code)
2001 S. Mt. Prospect Rd., Des Plaines, IL 60017-5065
..........................................................................
(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 Sections 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.
X
Yes ..... No .....
There were 18,560,570 common shares outstanding as of March 31, 1998.
<PAGE 2>
JUNO LIGHTING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
=====================================
(In Thousands)
February 28, November 30,
ASSETS 1998 1997
(Unaudited) (Unaudited)
----------- -----------
CURRENT ASSETS:
Cash and cash equivalents $ 2 007 $ 6 806
Marketable securities 72 255 65 766
Accounts receivable, less
allowance for possible losses
of $991,000 and $907,000 23 321 22 533
Inventories at lower of cost or market 23 468 22 707
Prepaid expenses and miscellaneous 4 469 4 696
---------- ---------
TOTAL CURRENT ASSETS 125 520 122 508
---------- ---------
PROPERTY, PLANT AND EQUIPMENT,
less accumulated depreciation of
$12,783,000 and $11,887,000 45 134 44 449
OTHER ASSETS:
Marketable securities 11 656 11 373
Goodwill and other intangibles, net
of accumulated amortization of
$1,409,000 and $1,367,000 4 332 4 603
Miscellaneous 4 703 4 456
---------- ---------
TOTAL OTHER ASSETS 20 691 20 432
---------- ---------
$ 191 345 $ 187 389
========== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 4 256 $ 3 579
Accrued liabilities 7 979 8 053
---------- ----------
TOTAL CURRENT LIABILITIES 12 235 11 632
---------- ----------
LONG-TERM DEBT & DEFERRED INCOME TAXES 5 166 5 127
---------- ----------
STOCKHOLDERS' EQUITY:
Common stock, $.01 par, shares
authorized 50,000,000;
outstanding 18,563,412 & 18,563,412 186 186
Paid-in-capital 4 934 4 934
Cumulative marketable securities
valuation adjustment 928 723
Cumulative loss on foreign
currency translation ( 392) ( 395)
Retained earnings 168 332 165 238
----------- ----------
173 988 170 686
Less Treasury stock, at cost,
2,842 and 3,642 shares ( 44) ( 56)
---------- ----------
TOTAL STOCKHOLDERS' EQUITY 173 944 170 630
---------- ----------
$ 191 345 $ 187 389
========== ==========
(See Notes To Consolidated Financial Statements)
<PAGE 3>
JUNO LIGHTING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
===========================================
(In Thousands Except Per
Share Amounts)
Three Months Ended
--------------------------
February 28, February 28,
1998 1997
(Unaudited) (Unaudited)
NET SALES $ 34 386 $ 30 804
COST OF SALES 17 616 16 453
------ ------
Gross profit 16 770 14 351
SELLING, GENERAL AND ADMINISTRATIVE 10 468 9 512
------ ------
Operating income 6 302 4 839
OTHER INCOME 931 960
----- ------
Income before taxes on income 7 233 5 799
TAXES ON INCOME 2 467 1 909
------ ------
NET INCOME $ 4 766 $ 3 890
====== ======
NET INCOME PER COMMON SHARE (BASIC AND DILUTED) $0.26 $0.21
====== ======
(See Notes To Consolidated Financial Statements)
<PAGE 4>
JUNO LIGHTING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF RETAINED EARNINGS
=====================================================
(In Thousands)
Three Months Ended
February 28, 1998
(Unaudited)
----------------
RETAINED EARNINGS, beginning of period $ 165 238
CASH DIVIDEND ($0.09 per share) ( 1 670)
REISSUANCE OF TREASURY STOCK ( 2)
NET INCOME, three months ended
February 28, 1998 4 766
----------
RETAINED EARNINGS, end of period $ 168 332
==========
(See Notes To Consolidated Financial Statements)
<PAGE 5>
JUNO LIGHTING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS
==================================
(In Thousands)
Three Months Ended
---------------------------
February 28, February 28,
1998 1997
(Unaudited) (Unaudited)
CASH FLOWS PROVIDED BY (USED IN) OPERATING
ACTIVITIES:
Net income $ 4 766 $ 3 890
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation & amortization 938 849
Changes in assets and liabilities:
(Increase) Decrease in accounts
receivable ( 785) 927
(Increase) in inventory ( 761) ( 544)
Decrease in prepaid expense 120 303
(Increase) Decrease in other
assets ( 19) 0
Increase (Decrease) in accounts
payable and accrued expenses 602 ( 4 927)
Deferred income taxes 68 ( 172)
--------- ---------
NET CASH PROVIDED BY OPERATING ACTIVITIES: 4 929 326
--------- ---------
CASH FLOWS PROVIDED BY (USED IN) INVESTING
ACTIVITIES:
Capital expenditures ( 1 580) ( 1 914)
Purchases of marketable securities ( 12 392) ( 3 490)
Sales of marketable securities 5 931 6 116
NET CASH (USED IN) PROVIDED BY INVESTING ---------- ---------
ACTIVITIES ( 8 041) 712
---------- ---------
<PAGE 6>
JUNO LIGHTING, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS (CONTINUED)
_______________________________
(In Thousands)
Three Months Ended
---------------------------
February 28, February 28,
1998 1997
___________ ___________
(Unaudited) (Unaudited)
CASH FLOWS PROVIDED BY (USED IN) FINANCING
ACTIVITIES:
Proceeds from exercise of stock
options 12 0
Dividend paid ( 1 670) ( 1 481)
Principal payments on long-term debt ( 29) ( 63)
___________ ___________
NET CASH (USED IN)
FINANCING ACTIVITIES ( 1 687) ( 1 544)
___________ ___________
NET (DECREASE) IN CASH ( 4 799) ( 506)
CASH AT BEGINNING OF PERIOD 6 806 3 473
___________ ___________
CASH AT END OF PERIOD $ 2 007 $ 2 967
=========== ==========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION:
Cash paid during the period for:
Interest $ 41 $ 67
Income taxes 208 239
(See Notes To Consolidated Financial Statements)
<PAGE 7>
JUNO LIGHTING, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FINANCIAL INFORMATION
The financial information presented in these consolidated financial
statements is unaudited but, in the opinion of management, reflects all normal
adjustments necessary for the fair presentation of the Company's financial
position, results of its operations and cash flows. The information in the
condensed consolidated balance sheet as of November 30, 1997 was derived from
the Company's audited consolidated financial statements.
INVENTORIES
Inventories are summarized as follows:
(In Thousands)
February 28, November 30,
1998 1997
Finished goods $ 8 808 $ 7 762
Raw materials 14 660 14 945
---------- ----------
$ 23 468 $ 22 707
========== ==========
NET INCOME PER COMMON SHARE
Basic earnings per share is calculated by dividing net income by the
weighted average number of common shares outstanding. Diluted earnings per
share is calculated by dividing net income by the weighted average number of
common shares outstanding including assumed exercise of dilutive stock options
during the periods. Such weighted average number of shares outstanding is
as follows:
THREE MONTHS ENDED
------------------
February 28, February 28,
1998 1997
---------- ----------
Basic 18,559,970 18,513,012
Diluted 18,584,295 18,524,796
<PAGE 8>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION
=========================================================
RESULTS OF OPERATIONS:
_____________________
Three Months Ended February 28, 1998 Compared With Three Months
_______________________________________________________________
Ended February 28, 1997
_______________________
During the first quarter ended February 28, 1998, net sales
increased by 11.6% to $34,386,000 compared to $30,804,000 for the like period
in 1997. This increase was not confined to any particular product line, market
or geographic area, but, in management's opinion, is reflective of an overall
increase in demand from improving economic conditions. Sales through Juno's
Canadian subsidiary increased 3.1% to $1,754,000 compared to $1,701,000 for the
like period in 1997.
Cost of sales as a percentage of net sales decreased to 51.2% for
the quarter, compared to 53.4% for the like period in 1997 due to increased
productivity, stable raw material costs and benefits resulting from the
retooling of high volume parts.
Selling, general and administrative expenses expressed as a
percentage of sales decreased slightly to 30.4% for the first quarter of 1998
compared with 30.9% for the like period in 1997 due primarliy to economies of
scale associated with the sales increase.
As a result of the above factors, operating income increased to
18.3% of sales as compared to 15.7% for the like period in 1997.
LIQUIDITY AND CAPITAL RESOURCES:
_______________________________
During the three month period ended February 28, 1998, the Company
generated positive net cash flow from operating activities of $4,929,000. This
was comprised principally of net income, depreciation and amortization, and
increases in accounts payable and accrued expenses (collectively aggregating
$6,306,000), net of increases in accounts receivable of $785,000 and inventory
of $761,000. The Company used the net cash provided from operating activities
to finance capital expenditures of $1,580,000, pay dividends of $1,670,000 and
to increase its investment portfolio by $6,461,000.
On March 2, 1998, the Company announced the declaration of a cash
dividend of 9 cents per share payable April 15, 1998, to stockholders of record
on March 16, 1998. The Board of Directors intends to maintain regular
quarterly dividends at the same rate. Management believes that the existing
level of working capital is adequate for the Company's liquidity needs
currently and in the foreseeable future. It is currently anticipated that
future working capital requirements and capital expenditures will be met by
internally generated funds.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
===================================================================
Not applicable.
<PAGE 9>
PART II - OTHER INFORMATION
===========================
Item 1. Legal Proceedings - Reference is made to Item 3 of the Company's
Annual Report on Form 10-K for the fiscal year ended November 30, 1997
for a description of Juno Online Services, L.P. ("Juno Online") vs.
Juno Lighting, Inc. and Network Solutions, Inc. (Civil Action
No. 96-1505-A in the United States District Court, Eastern District
of Virginia) (the "Juno Online Case"). The parties settled the
Juno Online Case in February 1998 and exchanged mutual releases.
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. (a) Exhibits - None
(b) During the quarter for which this report is filed, no reports on
Form 8-K were filed.
<PAGE 10>
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.
JUNO LIGHTING, INC.
By: George J. Bilek
--------------------------------------
George J. Bilek, Vice President Finance
(Principal Financial Officer)
Dated: April 14, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> NOV-30-1998
<PERIOD-END> FEB-28-1998
<CASH> 2007
<SECURITIES> 83911
<RECEIVABLES> 24312
<ALLOWANCES> 991
<INVENTORY> 23468
<CURRENT-ASSETS> 125520
<PP&E> 57917
<DEPRECIATION> 12783
<TOTAL-ASSETS> 191345
<CURRENT-LIABILITIES> 12235
<BONDS> 3356
0
0
<COMMON> 186
<OTHER-SE> 173758
<TOTAL-LIABILITY-AND-EQUITY> 191345
<SALES> 34386
<TOTAL-REVENUES> 34386
<CGS> 17616
<TOTAL-COSTS> 17616
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 97
<INTEREST-EXPENSE> 39
<INCOME-PRETAX> 7233
<INCOME-TAX> 2467
<INCOME-CONTINUING> 4766
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4766
<EPS-PRIMARY> .26
<EPS-DILUTED> .26
</TABLE>
