Form 10-QSB
U.S. Securities and Exchange Commission
Washington, D.C. 20549
Form 10-QSB
[x]QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1997
OR
[ ]TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
For the transition period from to
Commission File Number 0-11740
MESA LABORATORIES, INC.
(Exact Name of Small Business Issuer as Specified in its Charter)
COLORADO 84-0872291
(State or other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
12100 WEST SIXTH AVENUE, LAKEWOOD, COLORADO 80228
(Address of Principal Executive Offices) (Zip Code)
Issuer's telephone number, including area code: (303) 987-8000
3904 YOUNGFIELD STREET, WHEAT RIDGE, COLORADO 80033
(Previous Address) (Previous Zip Code)
Check whether the Issuer (1) filed all reports required to be filed by
Section 13 or 15 (d) of the Exchange Act, during the past 12 months and (2)
has been subject to the filing requirements for the past 90 days. Yes X
No .
State the number of shares outstanding of each of the Issuer's classes
of
common stock, as of the latest practicable date:
There were 4,297,008 shares of the Issuer's common stock, no par
value,
outstanding as of December 31, 1997.
Page 1 of 9
<PAGE>
ITEM 1. FINANCIAL STATEMENTS FORM 10-QSB
<TABLE>
MESA LABORATORIES, INC.
BALANCE SHEETS
(UNAUDITED)
<CAPTION>
DECEMBER 31, 1997 MARCH 31,
1997
<S>
<C> <C>
ASSETS
CURRENT ASSETS
Cash and Cash Equivalents $ 5,440,687 $ 3,867,549
Accounts Receivable, Net 1,399,046 1,658,090
Inventories
1,896,920 1,963,572
Prepaid Expenses
36,276 31,710
Deferred Income Taxes 93,400
93,400
TOTAL CURRENT ASSETS 8,866,329 7,614,321
PROPERTY, PLANT &
EQUIPMENT, NET 1,681,885
1,589,895
OTHER ASSETS
Patents, Trademarks and
Covenants, Net
881,614 1,002,214
TOTAL ASSETS $ 11,429,828 $
10,206,430
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts Payable $ 95,451
$ 46,282
Accrued Salaries & Payroll Taxes 229,760
237,361
Other Accrued Expenses 166,099
228,030
Taxes Payable
17,775 63,800
TOTAL CURRENT LIABILITIES 509,085 575,473
LONG TERM LIABILITIES
Deferred Income Taxes Payable 62,800
62,800
STOCKHOLDERS' EQUITY
Preferred Stock, No Par Value
- - -
Common Stock, No Par Value;
authorized 8,000,000 shares;
issued and outstanding,
4,297,008 shares (12/31/97)
and 4,316,236 shares (3/31/97) 3,372,495
3,426,979
Retained Earnings
7,485,448 6,141,178
TOTAL STOCKHOLDERS'
EQUITY
10,857,943 9,568,157
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 11,429,828 $ 10,206,430
</TABLE>
Page 2 of 9
<PAGE>
ITEM 1. FINANCIAL STATEMENTS (CONTINUED)FORM 10-QSB
<TABLE>
MESA LABORATORIES, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
<CAPTION>
Three
Months Three Months
Ended Ended
Dec. 31,
1997 Dec. 31, 1996
<S>
<C> <C>
Sales $
1,904,030 $ 2,108,845
Cost of Goods Sold
597,802 795,505
Selling, General & Administrative 526,853
535,239
Research and Development
58,422 75,390
Other (Income) and Expenses (61,607)
(32,828)
1,121,470 1,373,306
Earnings Before Income Taxes 782,560
735,539
Income Taxes
281,524 249,000
Net Income $
501,036 $ 486,539
Net Income Per Share of
Common Stock $
.11 $ .11
Weighted Average Number of
Shares Outstanding
4,474,000 4,480,000
</TABLE>
Page 3 of 9
<PAGE>
ITEM 1. FINANCIAL STATEMENTS (CONTINUED) FORM 10-QSB
<TABLE>
MESA LABORATORIES, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
<CAPTION>
Nine
Months Nine Months
Ended Ended
Dec. 31,
1997 Dec. 31, 1996
<S>
<C> <C>
Sales $
5,909,074 $ 5,754,358
Cost of Goods Sold
2,012,211 2,227,944
Selling, General & Administrative 1,566,269
1,633,692
Research and Development 199,415
178,734
Other (Income) and Expenses (162,118)
(83,348)
3,615,777 3,957,022
Earnings Before Income Taxes 2,293,297
1,797,336
Income Taxes
827,000 610,000
Net Income $
1,466,297 $ 1,187,336
Net Income Per Share of
Common Stock $
.33 $ .26
Weighted Average Number of
Shares Outstanding
4,452,000 4,502,000
</TABLE>
Page 4 of 9
<PAGE>
ITEM 1. FINANCIAL STATEMENTS (CONTINUED) FORM 10-QSB
<TABLE>
MESA LABORATORIES, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
<CAPTION>
Nine
Months Nine Months
Increase (Decrease) in Cash and Cash Ended
Ended
Equivalents Dec. 31, 1997 Dec.
31, 1996
<S>
<C> <C>
Cash Flows From Operating Activities:
Net Income $ 1,466,297
$ 1,187,336
Depreciation and Amortization 183,850
188,511
Change in Assets and Liabilities-
(Increase) Decrease in Accounts
Receivable
259,044 396,628
(Increase) Decrease in Inventories 66,652
86,234
(Increase) Decrease in Prepaid Expenses (4,566) 58,958
Increase (Decrease) in Accounts Payable 49,169 (38,818)
Increase (Decrease) in Accrued Liabilities (94,630) (101,295)
Net Cash (Used) Provided by Operating
Activities
1,925,816 1,777,554
Cash Flows From Investing Activities:
(Increase) Decrease in, Patents and
Trademarks
- - (4,001)
Capital Expenditures, Net of Retirements (176,167) (82,566)
Net Cash (Used) Provided by Investing
Activities
(176,167) (86,567)
Cash Flows From Financing Activities:
Common Stock Repurchases (192,470)
(155,747)
Proceeds From Stock Options Exercised 15,959
5,642
Net Cash (Used) Provided by Financing
Activities
(176,511) (150,105)
Net Increase (Decrease) In Cash and
Equivalents
1,573,138 1,540,882
Cash and Cash Equivalents at Beginning
of Period
3,867,549 1,789,632
Cash and Cash Equivalents at End of
Period $
5,440,687 $ 3,330,514
</TABLE>
Page 5 of 9
<PAGE>
ITEM 1. FINANCIAL STATEMENTS (CONTINUED)FORM 10-QSB
MESA LABORATORIES, INC.
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1997 AND 1996
(Unaudited)
NOTE A. SUMMARY OF ACCOUNTING POLICIES
The summary of the Issuer's significant accounting policies are
incorporated by reference to the Company's annual report on Form 10KSB, at
March 31, 1997.
The accompanying unaudited condensed financial statements reflect all
adjustments which, in the opinion of management, are necessary for a fair
presentation of the results of operations, financial position and cash flows.
The results of the interim period are not necessarily indicative of the
results for the full year.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
On December 31, 1997, the Company had cash and cash equivalents of
$5,440,687. In addition, the Company had other current assets totaling
$3,425,642 and total current assets of $8,866,329. Current liabilities of
Mesa Laboratories, Inc. were $509,085 which resulted in a current ratio of
17.4:1.
The Company has made net capital asset purchases of $176,167 for the
fiscal year-to-date.
The Company has announced its intention to repurchase up to 10% of its
outstanding common stock. Under the plan, the shares may be purchased from
time to time in the open market at prevailing prices or in negotiated
transactions off the market. Shares purchased will be used for general
corporate purposes and repurchases will be made with existing cash reserves.
Page 6 of 9
<PAGE>
FORM 10-QSB
RESULTS OF OPERATIONS
REVENUE
Net sales for the nine months ended December 31, 1997 increased $154,716
or 3% to $5,909,074 from the $5,754,358 net sales level achieved for the same
nine month period last year. Net sales for the quarter decreased $204,815 or
10% to $1,904,030 from the $2,108,845 net sales level achieved in the same
quarter last year. For both the first nine months and third quarter of the
fiscal year, the Medical and Datatrace product groups showed strong
increases,
while Nusonics product line sales decreased. Medical sales have been boosted
by increased sales of both Western Meters and ECHO Dialyzer Reprocessors.
Datatrace sales increases have resulted from addition of the new humidity and
pressure logging products. Most of the decrease in Nusonics= sales has
resulted from a decline in the flow meter line.
COST OF GOODS SOLD
Cost of goods sold for the first nine months as a percent of net
sales was 34%, a decrease of 5% from 39% one year ago. Cost of goods sold
for
the current quarter as a percent of net sales was 31% which represents a
decrease of 7% from the 38% level in the same quarter one year ago. Most of
the decrease realized for the quarter and year-to-date is attributable to
decreased material costs for the Datatrace electronics. In addition, the
shift in sales mix due to the decline in flow meter sales has had a favorable
impact on cost of goods sold as a percent of sales.
SELLING, GENERAL AND ADMINISTRATIVE
Selling, general and administrative expenses for the first nine months
decreased 4% or $67,423 to $1,566,269 from $1,633,692 in the same period last
year. Selling, general and administrative expenses for the current quarter
totaled $526,853 which was down 2% or $8,386 from $535,239 expended in the
same quarter one year ago. For both the quarter and year-to-date periods,
administrative, Datatrace marketing and Medical marketing expenses increased,
but were off-set by a decrease in Nusonics marketing expenses.
RESEARCH AND DEVELOPMENT
Research and development for the first nine months increased to $199,415
from $178,734 last year. For the quarter, research and development was
$58,422 and represents a $16,968 decrease over the same quarter last year due
to lower supply costs. For the year-to-date, research and development
spending increased due chiefly to increased compensation costs.
Page 7 of 9
<PAGE>NET INCOMEFORM 10-QSB
Net income for the nine months ended December 31, 1997, increased 23% to
$1,466,297 or $.33 per share from $1,187,336 or $.26 per share last year.
Net
income for the quarter was $501,036 or $.11 per share which rose 3% over the
net income of $486,539 or $.11 per share in the same quarter last year. For
the first nine months of the fiscal year, net income has improved due to
reductions in cost of goods sold and selling, general and administrative
expenses. For the most recent quarter the company decreased costs in all
major expense categories, but those cost improvements were off-set by a
decrease in revenues for the quarter.
PART II-OTHER INFORMATION
The Annual Meeting of shareholders of Mesa Laboratories, Inc. was held
on
November 7, 1997. Of the 4,308,137 Shares entitled to vote, 3,774,535 were
represented either in person or by proxy. Five directors were elected to
serve until the next Annual Meeting of Shareholders. The five directors
elected were:
Luke R. Schmieder
Paul D. Duke
Philip D. Quedenfeld
H. Stuart Campbell
G. Lee Southard
Page 8 of 9
<PAGE>
FORM 10-QSB
MESA LABORATORIES, INC.
DECEMBER 31, 1997
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Issuer has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MESA LABORATORIES, INC.
(Issuer)
DATED: February 13, 1998 BY:/s/ Luke R. Schmieder
Luke R. Schmieder
President, Chief Executive
Officer, Treasurer and
Director
DATED: February 13, 1998 BY:/s/ Steven W. Peterson
Steven W. Peterson
Vice President-Finance, Chief
Financial and Accounting Officer
and Secretary
Page 9 of 9
