FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1994
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 No. 0-11551
EXECUTONE Information Systems, Inc.
(Exact name of registrant as specified in its charter)
Virginia 86-0449210
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
478 Wheelers Farms Road, Milford, Connecticut 06460
(Address of principal executive offices) (Zip Code)
(203) 876-7600
(Registrant's telephone number, including area code)
N/A
(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
The number of shares outstanding of registrant's Common Stock,
$.01 par value per share, as of October 31, 1994 was 45,929,911.
INDEX
EXECUTONE Information Systems, Inc.
Page #
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets - September 30, 1994
and December 31, 1993. 3
Consolidated Statements of Operations -
Three Months and Nine Months Ended
September 30, 1994 and 1993. 4
Consolidated Statements of Cash Flows -
Nine Months Ended September 30, 1994 and 1993. 5
Notes to Consolidated Financial Statements. 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
PART II. OTHER INFORMATION 13
SIGNATURES 14
EXHIBIT 11. STATEMENT REGARDING COMPUTATION
OF PER SHARE EARNINGS 15
2
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
EXECUTONE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except for share amounts)
September 30, December 31,
1994 1993
ASSETS (Unaudited) (Restated)
CURRENT ASSETS:
Cash and cash equivalents $ 7,430 $ 7,406
Accounts receivable, net of
allowance of $1,337 and $1,017 46,647 37,567
Inventories 34,198 29,092
Prepaid expenses and other
current assets 6,134 5,789
Net assets of discontinued
operation --- 8,538
Total Current Assets 94,409 88,392
PROPERTY AND EQUIPMENT, net 16,266 14,727
INTANGIBLE ASSETS, net 44,006 44,215
DEFERRED TAXES 22,002 25,200
OTHER ASSETS 3,903 2,623
NET ASSETS OF DISCONTINUED
OPERATION --- 397
$ 180,586 $ 175,554
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt $ 1,278 $ 2,989
Accounts payable 31,541 29,295
Accrued payroll and related costs 8,316 7,750
Accrued liabilities 9,086 7,057
Accrued restructuring costs 1,485 1,381
Deferred revenue and customer
deposits 18,306 17,713
Total Current Liabilities 70,012 66,185
LONG-TERM DEBT 29,856 32,279
LONG-TERM DEFERRED REVENUE 2,134 1,345
TOTAL LIABILITIES 102,002 99,809
STOCKHOLDERS' EQUITY:
Common stock: $.01 par value;
60,000,000 shares authorized;
42,901,853 and 41,205,498
issued and outstanding 429 412
Additional paid-in capital 65,856 68,275
Retained earnings 12,299 7,058
Total Stockholders' Equity 78,584 75,745
$ 180,586 $ 175,554
The accompanying notes are an integral part of these consolidated
balance sheets.
3
<TABLE>
<CAPTION>
EXECUTONE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except for per share amounts)
Three Months Ended Nine Months Ended
9/30/94 9/30/93 9/30/94 9/30/93
<S> <C> <C> <C> <C>
REVENUES: (Restated) (Restated)
Product $ 36,814 $ 32,353 $102,450 $ 97,747
Base 39,733 35,544 116,016 101,697
76,547 67,897 218,466 199,444
COST OF REVENUES 44,783 40,325 128,951 119,407
Gross Profit 31,764 27,572 89,515 80,037
OPERATING EXPENSES:
Research, development
and engineering 2,398 1,943 6,899 6,129
Selling, general
& administrative 24,834 22,563 71,425 64,658
27,232 24,506 78,324 70,787
OPERATING INCOME 4,532 3,066 11,191 9,250
INTEREST, AMORTIZATION AND
OTHER EXPENSES, NET:
Cash 351 663 1,349 2,104
Noncash 869 788 2,363 2,244
1,220 1,451 3,712 4,348
INCOME BEFORE INCOME TAXES
FROM CONTINUING OPERATIONS 3,312 1,615 7,479 4,902
PROVISION FOR INCOME TAXES:
Cash 100 84 300 251
Noncash (utilization of
pre-acquisition tax
benefits - Note D) 1,226 565 2,693 1,714
1,326 649 2,993 1,965
INCOME FROM CONTINUING
OPERATIONS 1,986 966 4,486 2,937
INCOME FROM DISCONTINUED
OPERATIONS [NET OF INCOME
TAXES OF $161, $102 AND $130,
RESPECTIVELY] - 242 153 196
GAIN ON DISPOSAL OF
DISCONTINUED OPERATIONS
(NET OF INCOME TAXES
OF $403) - - 604 -
NET INCOME $ 1,986 $ 1,208 $ 5,243 $ 3,133
EARNINGS PER SHARE:
INCOME FROM CONTINUING
OPERATIONS $ 0.04 $ 0.03 $ 0.09 $ 0.07
DISCONTINUED
OPERATIONS 0.00 0.00 0.02 0.00
NET INCOME $ 0.04 $ 0.03 $ 0.11 $ 0.07
WEIGHTED AVG. COMMON AND
COMMON EQUIVALENT SHARES
OUTSTANDING 47,182 48,540 47,495 47,987
The accompanying notes are an integral part of these consolidated statements.
4
EXECUTONE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands) Nine Months Ended
September 30,
1994 1993
(Restated)
CASH FLOWS FROM OPERATING ACTIVITIES:
Income from continuing operations $ 4,486 $ 2,937
Adjustments to reconcile net income to net
cash provided by continuing operations:
Depreciation and amortization 5,904 5,935
Noncash expenses, including noncash
interest expense, provision for
income taxes not currently payable
and provision for losses on
accounts receivable 3,822 2,475
14,212 11,347
Net change in working capital items (11,066) 1,978
NET CASH PROVIDED BY CONTINUING OPERATIONS 3,146 13,325
Cash Flows from Discontinued Operations (551) (1,151)
NET CASH PROVIDED BY OPERATING ACTIVITIES 2,595 12,174
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (3,231) (1,353)
Proceeds from sale of VCS 9,700 ---
Other (837) (962)
NET CASH PROVIDED (USED) BY
INVESTING ACTIVITIES 5,632 (2,315)
CASH FLOWS FROM FINANCING ACTIVITIES:
Restructuring cost payments (254) (765)
Borrowings (repayments) under revolving
credit facility 806 (2,366)
Repayment of term note under credit
facility (3,750) (937)
Repayments of other long-term debt (1,077) (5,428)
Repurchase of stock (5,365) (645)
Proceeds from issuances of stock 1,437 476
NET CASH USED BY FINANCING
ACTIVITIES (8,203) (9,665)
INCREASE IN CASH AND CASH EQUIVALENTS 24 194
CASH AND CASH EQUIVALENTS -
BEGINNING OF PERIOD 7,406 7,404
CASH AND CASH EQUIVALENTS - END OF PERIOD $ 7,430 $ 7,598
The accompanying notes are an integral part of these consolidated
statements.
5
EXECUTONE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE A - NATURE OF THE BUSINESS
EXECUTONE Information Systems, Inc. (the "Company") designs,
manufactures, markets, installs, supports and services voice
processing systems and provides cost-effective long-distance
telephone service. The Company is also a leading supplier of
specialized hospital communications equipment. Products are sold
under the EXECUTONE, INFOSTAR, IDS, LIFESAVER and INFOSTAR/ILS
brand names through a worldwide network of direct sales and
service offices and independent distributors.
NOTE B - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have
been prepared in accordance with generally accepted accounting
principles for interim financial information and with the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In
the opinion of management, all adjustments, which include normal
recurring adjustments, considered necessary for a fair
presentation of the results for the interim periods presented
have been included.
As of July 1, 1988, an accumulated deficit of approximately $49.7
million was eliminated.
NOTE C - SALE OF VODAVI COMMUNICATIONS SYSTEMS DIVISION
As of March 31, 1994, the Company sold its Vodavi Communications
Systems Division (VCS), which sold telephone equipment to supply
houses and dealers under the brand names STARPLUS and INFINITE,
for approximately $10.9 million. Proceeds of the sale consisted
of approximately $9.7 million in cash and a $1.2 million note,
fully secured by a letter of credit and payable in September
1995. The proceeds were received in April 1994 and were used to
reduce borrowings under the Company's credit facility.
The sale resulted in an after-tax gain of $604,000 (net of income
tax provision of $403,000). The results of VCS have been
reported separately as a discontinued operation in the
Consolidated Statement of Operations. Prior year consolidated
financial statements have been restated to present VCS as a
discontinued operation. Net revenues of the discontinued
operation for the three-month period ended September 30, 1993
were $8.6 million. For the nine-month periods ended September
30, 1994 and 1993, net revenues of the discontinued operation
were $8.6 million and $24.1 million, respectively.
6
NOTE D - INCOME TAXES
The Company accounts for income taxes in accordance with FAS 109,
Accounting for Income Taxes. The deferred tax asset represents
the benefits that are more likely than not to be realized from
the utilization of pre and post-acquisition tax benefit
carryforwards, which include net operating losses, tax credits
and the excess of tax bases over the fair value of the net assets
at acquisition.
For the nine-month periods ended September 30, 1994 and 1993, the
Company made cash payments for income taxes of approximately
$228,000 and $73,000, respectively.
NOTE E - EARNINGS PER SHARE
Earnings per share is based on the weighted average number of
shares of common stock, convertible preferred stock (which was
entirely converted in 1993) and dilutive common stock equivalents
(which include stock options and warrants) outstanding during the
periods. Common stock equivalents and the convertible debentures
which are antidilutive have been excluded from the computations.
NOTE F - INVENTORIES
Inventories are stated at lower of first-in, first-out ("FIFO")
cost or market and consist of the following at September 30, 1994
and December 31, 1993 (amounts in thousands):
9/30/94 12/31/93
Raw Materials $ 3,146 $ 3,363
Finished Goods 31,052 25,729
$34,198 $29,092
NOTE G - OTHER MATTERS
For the nine-month periods ended September 30, 1994 and 1993, the
Company made cash payments of approximately $2.4 million and $3.1
million, respectively, for interest expense on indebtedness.
During the nine-month periods ended September 30, 1994 and 1993,
noncash financing activities other than those related to the sale
of VCS (See Note C) included capital lease obligations incurred
in connection with equipment acquisitions of $686,000 and $1.4
million, respectively, noncash proceeds for issuances of stock
from application of credits under an option credit plan of
$339,000 and $315,000, respectively, and Common Stock Purchase
Warrants exercised through bond conversion of $1.1 million and
$571,000, respectively.
7
In September 1994, the Company paid $1.2 million to the former
shareholders of Isoetec Texas, Inc. in partial settlement of
claims by such shareholders. This payment was an adjustment of
the purchase price recorded when the Company acquired Isoetec
Texas, Inc. in 1990 and increased intangible assets accordingly.
Refer to the consolidated statements of cash flows for
information on all cash-related operating, investing and
financing activities.
8
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Introduction
The Company's revenues are primarily derived from sales of its
products and services through a worldwide network of Company-
owned direct sales and service offices and independent
distributors. The Company's end-user revenues are derived from
two primary sources: (1) sales of systems to new customers, which
include sales of application-specific software options ("product
revenues"), and (2) servicing the end-user base through the
upgrade, expansion, enhancement (which includes sales of
application-specific software options) and maintenance of
previously installed systems, as well as revenues from the
INFOSTAR/LD+ program (commonly referred to as "base revenues").
Base revenues usually generate higher operating income margin
than initial sales of systems, since the Company's selling
expenses for base revenues are lower than those for initial
system sales. Sales of the Company's application-specific
software options and related services generally produce higher
operating income margins than both system sales and base revenues
due to the added performance value and relatively low production
costs of such proprietary software and services.
Results of Operations
Total revenues for the three-month and nine-month periods ended
September 30, 1994 were 13% and 10% higher, respectively, than
the comparable 1993 periods. Product revenues for the three-
month period ended September 30, 1994 increased 14% over the
corresponding 1993 period primarily due to a volume increase in
voice processing products. In addition, sales of
videoconferencing products resulted in the first million dollars
of revenue for that product line during the quarter. For the
nine-month period ended September 30, 1994, product revenues
increased 5% from the corresponding 1993 period as a 38% increase
in voice processing revenue offset the impact of other product
inventory shortages earlier in the year caused by a fire which
occurred at the Company's main subcontractor's production
facility in China in December 1993 (see page 10). Base revenues
for the three-month and nine-month periods ended September 30,
1994 were 12% and 14% higher, respectively, than the comparable
1993 periods. The increase in base revenues was primarily
attributable to continuing growth in sales to the Company's
existing customer base, including increased sales of systems
upgrades, expansions and maintenance as well as volume increases
generated by the LD+ program.
For the three-month periods ended September 30, 1994 and 1993,
gross profit as a percentage of total revenues was 41.5% and
40.6%, respectively. Gross profit as a percentage of total
revenues for the nine-month periods ended September 30, 1994 and
1993 was 41.0% and 40.1%, respectively. The increases are due to
higher overall volume and a continued mix shift toward the
Company's software-oriented, higher-margin products. Voice mail
and ACD unit sales increased significantly versus both the
comparable 1993 periods, positively impacting base and product
gross profit.
9
Operating income as a percentage of total revenues was 5.9% and
4.5% for the three-month periods ended September 30, 1994 and
1993, respectively, and 5.1% and 4.6% for the nine-month periods
ended September 30, 1994 and 1993, respectively. Operating
income as a percentage of total revenues for both the three-month
and nine-month periods increased due to improved gross profit
margins. Research, development and engineering expenses
increased 12.5% for the nine-month period ended September 30,
1994 compared to the corresponding 1993 period, which reflect the
continuing increased investments in engineering for new product
development whose positive impact on gross profit is beginning to
be realized. SG&A expenditures for the three-month and nine-
month periods have increased in total dollars versus the
comparable 1993 periods but, as a percentage of sales, have not
changed significantly. The dollar increase is largely the result
of higher selling expenses, which reflect the impact of higher
sales volume and our continued investment in personnel and
training resulting from new product development.
Interest, amortization and other expenses, net for the three-
month and nine-month periods ended September 30, 1994 was lower
than the corresponding 1993 periods due, primarily, to lower
interest expense for the Company's credit facility resulting from
lower borrowing levels and an interest rate reduction on the
Company's bank borrowings.
For the three-month period ended September 30, 1994, the Company
recorded a provision for income taxes of $1.3 million. For the
nine-month period ended September 30, 1994, the Company
recorded a provision for income taxes of $3.0 million for
continuing operations, $102,000 for discontinued operations and
$403,000 for the gain on the sale of its VCS division. Of the
total provision, $3.2 million was recorded as a reduction of the
deferred tax asset to reflect the utilization of tax benefit
carry- forwards. As a result of the utilization of these
benefits, the Company does not have a significant tax liability
for the period. The Company has substantial tax benefit
carryforwards which means that minimal taxes will be paid in the
near future.
In December 1993, a fire occurred at the Company's main
subcontractor's production facility in Shinzen, China, causing
inventory shortages during the first six months of 1994. The
production problems were largely alleviated by the Company's
ability to increase its own production and find alternative
manufacturing sources. In July 1994, the Company recovered $4
million from its insurance carrier for additional direct costs
related to the emergency production situation. The
subcontractor's facility has since been rebuilt and the Company
does not anticipate any significant additional product costs will
be incurred.
As of March 31, 1994 the Company sold its Vodavi Communications
Systems Division (VCS), which sold telephone equipment to supply
houses and dealers under the brand names STARPLUS and INFINITE,
for approximately $10.9 million. Proceeds of the sale consisted
of approximately $9.7 million in cash and a $1.2 million note,
fully secured by a letter of credit and payable in September
1995. The proceeds were received in April 1994 and were used to
reduce borrowings under the Company's credit facility.
10
The sale of VCS resulted in an after-tax gain of $604,000 (net of
income tax provision of $403,000). The results of VCS have been
reported separately as a discontinued operation in the
Consolidated Statement of Operations. Prior year consolidated
financial statements have been restated to present VCS as a
discontinued operation. Net revenues of the discontinued
operation for the three-month period ended September 30, 1993
were $8.6 million. For the nine-month periods ended September
30, 1994 and 1993, net revenues of the discontinued operation
were $8.6 million and $24.1 million, respectively.
In September 1994, the Company paid $1.2 million to the former
shareholders of Isoetec Texas, Inc. in partial settlement of
claims by such shareholders. This payment was an adjustment of
the purchase price recorded when the Company acquired Isoetec
Texas, Inc. in 1990 and increased intangible assets accordingly.
Liquidity and Capital Resources
The Company's liquidity is represented by cash, cash equivalents
and cash availability under its existing credit facilities. The
Company's liquidity was approximately $26 million and $29 million
as of September 30, 1994 and December 31, 1993, respectively.
At September 30, 1994 and December 31, 1993, cash and cash
equivalents amounted to $7.4 million which represented 8% of
current assets. The Company has generated $14.2 million of cash
during the nine-month period ended September 30, 1994 and an
additional $9.7 million of cash from the sale of VCS. The cash
has been used to reduce debt by $4.2 million, repurchase $5.4
million of the Company's common stock, fund $11.1 million of
working capital, and purchase $3.2 million of capital assets.
For the comparable period in 1993, the Company generated $11.3
million of cash, which was used primarily to reduce debt by $9.5
million and purchase $1.4 million of capital assets. The
increase in the funding of working capital is primarily accounts
receivable and inventory. The increase in accounts receivable is
a result of the 13% revenue increase for the three-month period
ended September 30, 1994 as compared to the comparable 1993
period and the increase in days sales outstanding due to
increased sales to National Accounts and the Federal government,
which generally have a longer collection cycle. Inventory
increased due to a continuation of the Company's efforts to
rebuild inventory which was depleted during the emergency
production situation earlier in 1994.
Total debt at September 30, 1994 was $31.1 million, a decrease of
$4.2 million from $35.3 million at December 31, 1993. The
reduction in debt is due to the application of proceeds from the
sale of VCS of $9.7 million, of which $2.2 million was used to
reduce the Company's term loan and $7.5 million was used to
reduce the Company's revolving credit facility, the exercise of
common stock purchase warrants through bond conversions of $1.1
million, and repayments of other long-term debt of $2.6 million.
This was partially offset by increased borrowings under the
revolving credit facility of $8.3 million. The increased
borrowings were used primarily to fund working capital and also
included approximately $3.0 million in temporary increases
resulting from the purchase of the Company's common stock for the
Executive Stock Incentive Plan, which will be repaid by the
enrolled executives during the fourth
11
quarter of 1994 and expenditures for the move of the Corporate
headquarters to be offset by monies granted by the State of
Connecticut, which the Company expects to receive before the end
of the year. Other increases to total debt resulted from capital
lease agreements for equipment purchases of $0.7 million and an
increase to the carrying value of the Company's Convertible
Subordinated Debentures of $0.2 million due to accretion.
In August 1994, the Company amended its Credit Facility whereby
it has the option of denominating a portion of its borrowings in
Eurodollars. It also permits the Company to issue a Letter of
Credit to support amounts loaned by the Company's banks to the
Company's senior management in connection with its Executive
Stock Incentive Plan approved by the shareholders in June 1993.
This Letter of Credit has a minimal impact on the Company's
borrowing capability.
As of October 31, 1994, approximately $14.0 million of direct
borrowings was available under the Company's credit facility.
The Company believes that borrowings available under the credit
facility and cash flow from operations will be sufficient to meet
working capital and other requirements for the next twelve
months.
12
<PAGE>
PART II - OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
Not applicable.
Item 2. CHANGES IN SECURITIES
Not applicable.
Item 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
Item 5. OTHER INFORMATION
Not applicable.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
a) Exhibits
11 - Statement Regarding Computation of Per Share Earnings
b) Reports on Form 8-K
Not applicable.
13
<PAGE>
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.
EXECUTONE Information Systems, Inc.
Dated: November 11, 1994 /s/ Alan Kessman
Alan Kessman
Chairman, President and
Chief Executive Officer
Dated: November 11, 1994 /s/ Anthony R. Guarascio
Anthony R. Guarascio
Vice President Finance and
Chief Financial Officer
14
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<CAPTION>
EXHIBIT 11
EXECUTONE INFORMATION SYSTEMS, INC. AND SUBSIDIARIES
STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS
Three Months Ended Nine Months Ended
9/30/94 9/30/93 9/30/94 9/30/93
<S> <C> <C> <C> <C>
(Restated) (Restated)
INCOME FROM CONTINUING
OPERATIONS $ 1,986,000 $ 966,000 $ 4,486,000 $ 2,937,000
DISCONTINUED OPERATIONS:
INCOME FROM OPERATIONS,
NET OF INCOME TAXES --- 242,000 153,000 196,000
GAIN ON DISPOSAL,
NET OF INCOME
TAXES --- --- 604,000 ---
NET INCOME $ 1,986,000 $ 1,208,000 $ 5,243,000 $ 3,133,000
INTEREST EXPENSE
ADJUSTMENT 7,000 44,000 20,000 132,000
ADJUSTED NET INCOME $ 1,993,000 $ 1,252,000 $ 5,263,000 $3,265,000
WEIGHTED AVERAGE NUMBER
OF COMMON SHARES 43,317,000 32,536,000 43,253,000 31,965,000
OUTSTANDING
COMMON STOCK EQUIVALENTS:
Add - Net shares
assumed to be issued
for dilutive stock
option and warrants 3,376,000 4,411,000 3,404,000 4,280,000
Add - Shares assumed
to be issued on
conversion of preferred
stock (converted
entirely in 1993) and
exercise of related
warrants 489,000 11,593,000 838,000 11,742,000
TOTAL WEIGHTED AVERAGE
COMMON AND COMMON
EQUIVALENT SHARES
OUTSTANDING 47,182,000 48,540,000 47,495,000 47,987,000
EARNINGS PER COMMON
SHARE:
Income From Continuing
Operations $ 0.04 $ 0.03 $ 0.09 $ 0.07
Discontinued
Operations --- --- 0.02 ---
Net Income $ 0.04 $ 0.03 $ 0.11 $ 0.07
15
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</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> SEP-30-1994
<CASH> 7,430
<SECURITIES> 0
<RECEIVABLES> 47,984
<ALLOWANCES> 1,337
<INVENTORY> 34,198
<CURRENT-ASSETS> 94,409
<PP&E> 44,085
<DEPRECIATION> 27,819
<TOTAL-ASSETS> 180,586
<CURRENT-LIABILITIES> 70,012
<BONDS> 29,856
<COMMON> 429
0
0
<OTHER-SE> 78,155
<TOTAL-LIABILITY-AND-EQUITY> 180,586
<SALES> 218,466
<TOTAL-REVENUES> 218,466
<CGS> 128,951
<TOTAL-COSTS> 128,951
<OTHER-EXPENSES> 78,324
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,712
<INCOME-PRETAX> 7,479
<INCOME-TAX> 2,993
<INCOME-CONTINUING> 4,486
<DISCONTINUED> 757
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,243
<EPS-PRIMARY> 0.11
<EPS-DILUTED> 0.11
</TABLE>
