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 October 1, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934.
For transition period from to
Commission file number 0-13136
CINCINNATI MICROWAVE, INC.
(Exact name of registrant as specified in its charter)
Ohio 31-0903863
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Microwave Plaza, Cincinnati, Ohio 45249-8236
(Address of principal executive offices) (Zip Code)
(513) 489-5400
(Registrant's telephone number)
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 only class of the registrant's common stock is its common
shares, without par value. As of October 1, 1995, there were
15,595,116 common shares outstanding.
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
CINCINNATI MICROWAVE, INC.
BALANCE SHEET
(Amounts in thousands except share data)
Oct. 1, Dec. 25,
1995 1994
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 614 $ 40
Accounts receivable, net 16,500 5,137
Inventories, net 19,864 9,159
Other current assets 655 602
------ ------
TOTAL CURRENT ASSETS $ 37,633 $ 14,938
Restricted cash 308 505
Property, plant and equipment, net 14,194 14,543
Intangibles, net 2,240 2,853
------ ------
TOTAL ASSETS $ 54,375 $ 32,839
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable $ 9,609 $ 8,627
Current portion of long-term debt 4,501 600
Accrued expenses 4,028 4,071
Current lease obligations 995 1,164
Unearned revenue 700 709
Accrued taxes 62 1,468
------ ------
TOTAL CURRENT LIABILITIES $ 19,895 $ 16,639
Lease obligations 725 1,422
Unearned revenue - noncurrent 365 457
Long-term debt 0 7,419
Common shares, without par value
($.20 stated value); 20,000,000 shares
authorized; 18,053,120 shares issued in
1995 and 17,053,120 issued in 1994 3,641 3,411
Paid-in capital 24,190 17,578
Retained earnings 22,919 26,921
Treasury stock at cost, 2,608,004 shares-1995;
6,110,658 shares-1994 (17,360) (41,008)
------ ------
TOTAL SHAREHOLDERS' EQUITY 33,390 6,902
------ ------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 54,375 $ 32,839
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<TABLE>
<CAPTION>
CINCINNATI MICROWAVE, INC.
STATEMENT OF OPERATIONS
(Amounts in thousands except per share data)
(Unaudited)
Three months ended Nine months ended
Oct. 1, Sep. 25, Oct. 1, Sep. 25,
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Net sales $22,117 $15,299 $54,782 $41,341
Cost of sales 18,391 12,312 41,817 29,820
------ ------ ------ ------
Gross profit 3,726 2,987 12,965 11,521
Operating expenses:
Research and development 2,029 2,099 5,631 6,326
Selling expenses 2,792 3,447 8,307 9,152
Administrative expenses 1,293 1,142 3,575 2,409
------ ------ ------ ------
6,114 6,688 17,513 17,887
------ ------ ------ ------
Operating loss (2,388) (3,701) (4,548) (6,366)
Interest expense (279) (234) (838) (459)
Other income (expense), net 30 (60) (54) 506
------ ------ ------ ------
Loss before income taxes (2,637) (3,995) (5,440) (6,319)
Income tax benefit 0 0 (1,438) 0
------ ------ ------ ------
Net loss ($2,637) ($3,995) ($4,002) ($6,319)
Loss per share ($0.18) ($0.37) ($0.28) ($0.58)
Weighted average shares
outstanding 14,672 10,888 14,175 10,864
</TABLE>
The accompanying notes are an integral part of these financial
statements.
<TABLE>
<CAPTION>
CINCINNATI MICROWAVE, INC.
STATEMENT OF CASH FLOWS
(Amounts in thousands)
(Unaudited)
Nine months ended
Oct. 1, 1995 Sep. 25, 1994
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (4,002) $ (6,319)
Adjustments to reconcile net loss to net cash
provided by (used in) operations:
Depreciation 2,894 2,616
Amortization 613 614
Gain on disposition of property, plant & equipment 0 (658)
Other non-cash 72 50
Changes in operating assets and liabilities:
Accounts receivable (11,363) (92)
Inventories (10,705) (8,211)
Other current assets (53) (373)
Accounts payable 982 6,410
Accrued taxes (1,406) (18)
Unearned revenue (101) 323
Other (43) 909
------ ------
Total adjustments/changes (19,110) (1,570)
------ ------
NET CASH USED IN OPERATING ACTIVITIES (23,112) (4,749)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property, plant and equipment (2,545) (3,265)
Proceeds from sale of property, plant & equipment 0 820
Decrease (increase) in restricted cash 197 (200)
------ ------
NET CASH USED IN INVESTING ACTIVITIES (2,348) (2,645)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable 9,097 9,440
Payments on notes payable (12,615) (6,169)
Proceeds from lease obligations 0 1,670
Payment of lease obligations (866) (424)
Issuance of warrants 1,631 0
Exercise of stock options 366 298
Net proceeds from units and stock offerings 28,421 0
------ ------
NET CASH PROVIDED BY FINANCING ACTIVITIES 26,034 4,815
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS $ 574 $(2,579)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 40 2,842
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 614 $ 263
</TABLE>
The accompanying notes are an integral part of these financial
statements.
CINCINNATI MICROWAVE, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
Note 1 - Summary of Significant Accounting Policies
The Company's fiscal year is comprised of 52 or 53 weeks, ending
on the last Sunday in the calendar year. The nine months ended
October 1, 1995, included 40 weeks and the nine months ended
September 25, 1994, included 39 weeks.
The accompanying unaudited condensed financial statements of
Cincinnati Microwave, Inc. (the "Company") have been prepared in
accordance with Article 10-01 of Regulation S-X of the
Securities and Exchange Commission and do not include all
information required by generally accepted accounting
principles. However, in the opinion of the Company, these
financial statements contain all adjustments necessary to
present fairly the financial position as of October 1, 1995 and
December 25, 1994, the results of operations for the three and
nine months ended October 1, 1995 and September 25, 1994 and
the cash flows for the nine months ended October 1, 1995 and
September 25, 1994. For further information regarding the
accounting policies of the Company, refer to the Financial
Statements and Notes thereto included in the Company's Annual
Report on Form 10-K for the year ended December 25, 1994.
Note 2 - Rights and Stock Offering
In the first quarter of 1995, the Company completed a Rights
Offering (the Offering) of 1,482,435 units for $7 per unit; each
unit consisted of two Common Shares and one warrant entitling
the holder to purchase one additional Common Share for $4. The
Offering generated net proceeds of $9.3 million.
The proceeds from the Offering were used to reduce debt and to
increase working capital. Offering costs of $175,000 included
as a prepaid asset at December 25, 1994 reduced Paid-in capital
upon completion of the Offering. 2,964,870 shares of Treasury
stock were reissued as part of the Offering. Paid-in capital
was reduced by the excess cost of the Treasury stock over the
net proceeds of the Offering.
In the third quarter of 1995, the Company completed a Stock
Offering of 4,600,000 Common Shares, of which 1,150,000 shares
were sold by the Company and 3,450,000 were sold by a selling
shareholder. The 1,150,000 shares sold by the Company generated
net proceeds of $19.1 million. The funds were used to pay
amounts outstanding under the existing revolving credit line and
to fund the growth in working capital required for the planned
increase in production and sales for the third and fourth quarters.
Note 3 - Significant Customer
One customer, AT&T, represented 26% and 12% of revenue for the
three and nine months ended October 1, 1995, respectively.
Note 4 - Inventories
Inventories consist of the following (amounts in thousands):
<TABLE>
<CAPTION>
Oct. 1, Dec. 25,
1995 1994
<S> <C> <C>
Materials and supplies 10,834 4,710
Work in process 2,021 1,933
Finished goods 7,009 2,516
------ ------
$19,864 $9,159
</TABLE>
Note 5 - Notes Payable
At the end of the third quarter, the Company had borrowed $4.5 million (term
loan balance of $2.6 million and $1.9 million on the revolving credit
facility) against its credit facility due June 30, 1996. The $9.6 million
credit facility consists of the term loan and (i) a $7.0 million revolving
credit facility and (ii) a standby letter of credit facility not to exceed
$1.0 million; however, the sum of the outstanding principal balance of the
revolving credit and the aggregate amount of the Company's outstanding letters
of credit shall not exceed $7.0 million at any time. The credit facility is
secured by a first lien on the Company's inventory, receivables, equipment
and a mortgage on the real estate of the Company.
Subsequent to the end of the quarter, the revolving credit facility was
reduced to $5.0 million by the lending institution. A temporary increase
has been extended by the lending institution maintaining the revolving
limit at $7.0 million through November 17, 1995 and $6.0 million through
November 30, 1995. As of November 14, 1995, the Company had borrowed an
additional $4.7 million against the revolving credit facility to fund
further increases in accounts receivable and inventories.
At October 1, the Company was in violation of one covenant of the
borrowing agreement relating to the net loss incurred for the quarter.
The lending institution has waived this violation for the third
quarter; however, as a result of the covenant violation the lending
institution has raised the lending rates to prime plus 2.0% for the
revolving loan, from prime plus 1.25%, and prime plus 2.25% on the
term loan, from prime plus 1.50%.
Note 6 - Income taxes
In March 1995, as a result of the closure of the Company's 1991
Federal tax return, the Company released certain tax reserves to
income. This adjustment increased net income for the first
quarter by $1.4 million.
Note 7 - Litigation
Subsequent to the end of the quarter, four shareholder suits
were filed against the Company. On October 18, 1995, an action
was filed in the United States District Court, Southern District
of Ohio, Western Division, by Richard Kaufman, individually and
allegedly on behalf of all others similarly situated, against
the Company, James L. Jaeger, Jacques A. Robinson, John W.
Noland, the Company's Directors, Montgomery Securities and Roney
& Co. On October 24, 1995, another action was filed in the
United States District Court, Southern District of Ohio, Western
Division, by Bruce Stumpf and Paul J. O'Reilly, individually and
allegedly on behalf of others similarly situated, against the
same defendants named in the Kaufman suit. Both actions allege
that, in connection with the sale of 4,000,000 Common Shares of
the Company in a public offering in late August 1995, the
defendants had violated various sections of the Securities Act
of 1933 and had made negligent misrepresentations. The
plaintiffs generally seek damages in an amount equal to the
difference between the price paid for the shares purchased in
the public offering and either the current value of such shares,
if currently held, or the price at which such shares were
disposed of in the market, if disposed of before the
commencement of the action; or, alternatively, to rescind the
purchases and recover the consideration paid for the shares or,
if such shares are no longer held by plaintiffs, for unspecified
damages.
On October 18, 1995, an action was filed in the United States
District Court, Southern District of Ohio, Western Division, by
Chesapeake Capital Group, Inc., for itself and allegedly on
behalf of all others similarly situated, against the Company,
James L. Jaeger, Jacques A. Robinson, John W. Noland, Montgomery
Securities and Roney & Co. On November 2, 1995, an action was
filed in the United States District Court, Southern District of
Ohio, Western Division, by Mary Ellen Guthrie and Ronald S.
Rees, individually and allegedly on behalf of all others
similarly situated, against the Company, James L. Jaeger and
Jacques A. Robinson. Both actions allege that, in connection
with the public offering of 4,000,000 Common Shares of the
Company in late August 1995, the defendants had violated
sections of the Securities Exchange Act of 1934. Both
complaints seek unspecified damages to be determined at trial.
The Company is presently evaluating the allegations contained in
these lawsuits.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION
RESULTS OF OPERATIONS
The following table shows net revenues by product line for
Cincinnati Microwave, Inc. for the third quarter and first nine
months of 1995 and 1994 (000 omitted):
Third Quarter 1995 Third Quarter 1994
$$ % $$ %
Product Line
Radar Detectors $ 13,256 60 $ 10,560 69
Cordless Telephones 8,552 39 3,572 23
Other 309 1 1,167 8
------ --- ------ ---
Total $ 22,117 100 $ 15,299 100
Nine Months 1995 Nine Months 1994
$$ % $$ %
Product Line
Radar Detectors $ 39,344 72 $ 32,572 79
Cordless Telephones 14,430 26 6,128 15
Other 1,008 2 2,641 6
------ --- ------ ---
Total $ 54,782 100 $ 41,341 100
Cincinnati Microwave's net sales for the third quarter of $22.1 million were
45% higher than the comparable period of 1994. Net sales for the nine months
(40-week period) ended October 1, 1995, increased 33% to $54.8 million as
compared with $41.3 million in the 39-week period of 1994. Indicative of the
anticipated shift in the sales mix, third quarter revenue from cordless
telephones with SureLinktm technology rose 140% to $8.6 million, or nearly
40% of net sales, from $3.6 million, or 23% of net sales, in last year's
comparable period. Sales of cordless telephones to AT&T represented 26% and
12% of net revenue for the three and nine month periods ended October 1, 1995,
respectively. Third quarter revenue from radar detectors was up 26% to $13.3
million from $10.6 million in the comparable period of 1994.
The Company's gross profit margin was 17% for the third quarter compared with
20% for the comparable period of 1994 and 24% for the nine months ended
October 1, 1995 versus 28% for 1994. The decline in the gross profit margin
was partially due to unanticipated material and manufacturing costs incurred
by the Company to maintain product quality and timely production, and to
meet commitments to customers. To correct a design difficulty with a key
component (battery charge contacts) in certain of its new cordless telephone
models, the Company was required to spend more than expected to customize
replacement parts, to obtain additional parts and to run the production lines
at less than optimum efficiency. In addition, as a result of a vendor's
production error and, separately, a product design error relating to
preprogrammed integrated circuits, the Company incurred additional costs
to obtain one-time programmable integrated circuits to use in place of the
preprogrammed integrated circuits and to redesign its cordless telephone
and radar detector models to use these programmable circuits.
Gross profit margin percent year to year also was adversely impacted by the
continued, planned shift in the sales mix from direct retail business that
generates a higher gross margin to OEM and reseller business. OEMs and
resellers, including AT&T, accounted for 65% of total sales in the third
quarter compared with 39% for the comparable period in 1994 and 57% for
the nine months ended October 1, 1995 versus 39% in the 1994 period.
Operating expenses in the third quarter were reduced by 9% from the comparable
quarter of 1994. The operating expense decline reflects lower selling and
research and development expenses, offset in part by higher administrative
expenses. The decrease in selling expense was due primarily to lower
advertising expenses versus 1994. Advertising expenses in the third quarter
of 1994 included the costs of extensive promotions for the emerging spread
spectrum cordless telephone product category and the introduction of two new
radar detectors. The increase in administrative expenses reflected the
addition of administrative personnel to support the business growth.
Primarily as a result of the sales increase, the operating loss for the
third quarter was reduced to $2.4 million from $3.7 million for the comparable
period of 1994. Interest expense for the third quarter was $279,000 versus
$234,000 in 1994, due to the receipt of equity proceeds at the end of August
that were utilized to pay amounts outstanding under the revolving credit line.
The net loss for the quarter was $2.6 million versus a net loss of $4.0
million in 1994. The net loss for the first nine months declined to $4.0
million from $6.3 million in 1994. In March 1995, as a result of the closure
of the Company's 1991 Federal tax return, the Company released certain tax
reserves to income. The adjustment increased net income for the first quarter
of 1995 by $1.4 million. The first nine months of 1994 included a gain of
$657,000 from a land sale.
LIQUIDITY AND CAPITAL RESOURCES
During the third quarter of 1995, the Company completed an equity offering
that generated $19.1 million in net proceeds. The funds were used to pay
off the existing revolving credit line and to fund the growth in working
capital required for the planned increase in production and sales for the
third and fourth quarters. In addition, during the first nine months of
1995 the Company incurred $500,000 of capital lease obligations and utilized
$2.0 million of cash flow for capital expenditures for additional production
equipment. In the fourth quarter, the Company has commitments for an
additional $1.5 million in capital expenditures for production equipment
to be funded through $1.0 million in capital lease obligations and the
remainder through cash flow.
The primary contributors to the $19.4 million increase in working capital
between year-end 1994 and the end of the third quarter were a $11.4 million
(221%) rise in accounts receivable and a $10.7 million (117%) increase in
inventories. Accounts payable rose only $1.0 million (11%) between year-end
1994 and the end of the third quarter despite the increase in inventories as
the Company maintained appropriate credit terms with its vendors.
The increase in accounts receivable to $16.5 million at the end of the third
quarter reflected the upward sales trend of cordless telephones during 1995,
with almost half of total unit volume of cordless telephones sold for the
year-to-date period shipped in the last month of the third quarter. OEMs
and resellers, for which typical credit terms (e.g., payment within 30 to
45 days after delivery) are made available on their large volume orders,
represented a significantly larger proportion of sales in 1995 vs. 1994.
Retail customers generally have paid for their purchase at the time
it was shipped or delivered. The Company anticipates that the accounts
receivable balance could remain near the current level ($21.0 million at
November 14, 1995) through year-end due to the high volume of fourth quarter
OEM and reseller sales. Receivables should decrease in the first quarter.
The $10.7 million increase in inventories between the end of the third quarter
and year-end 1994 was driven by a $6.1 million increase in raw materials and
work in process, as the Company continued to purchase components with which
to manufacture products, as well as a $4.5 million increase in finished goods
inventory. Both raw material and finished good inventories continued to rise
after the end of the third quarter as the Company prepared for December
shipments. Inventories at year-end, however, should be in line with the
levels at the end of the third quarter.
Despite the current outlook for a seasonally strong 1995 fourth quarter,
followed by a stronger first quarter than prior years due to demand for
cordless telephones from OEM customers, year-end raw material inventories
will be above levels necessary to support the anticipated sales volume.
Based on the Company's periodic historic difficulties with procurement
of components,the higher level of inventory could provide an added level
of security in meeting customer commitments. The Company believes the
finished goods inventory at year-end will be appropriate for the anticipated
sales volume.
At the end of the third quarter, the Company had borrowed $4.5 million (term
loan balance of $2.6 million and $1.9 million on the revolving credit
facility) against its credit facility due June 30, 1996. The $9.6 million
credit facility consists of the term loan and (i) a $7.0 million revolving
credit facility and (ii) a standby letter of credit facility not to exceed
$1.0 million; however, the sum of the outstanding principal balance of the
revolving credit and the aggregate amount of the Company's outstanding letters
of credit shall not exceed $7.0 million at any time. The credit facility is
secured by a first lien on the Company's inventory, receivables, equipment
and a mortgage on the real estate of the Company.
Subsequent to the end of the quarter, the revolving credit facility was
reduced to $5.0 million by the lending institution. A temporary increase
has been extended by the lending institution maintaining the revolving
limit at $7.0 million through November 17, 1995 and $6.0 million through
November 30, 1995. As of November 14, 1995, the Company had borrowed an
additional $4.7 million against the revolving credit facility to fund
further increases in accounts receivable and inventories. At November
14, 1995, total borrowings consisted of the term loan (with a current
outstanding balance of $2.5 million) and $6.7 million borrowed against
the revolving credit line.
The lending institution indicated that it reduced the revolving credit limit
for several reasons, including the loss incurred by the Company in the third
quarter and the recent significant rise in working capital. The Company
anticipates that it will be able to reduce the outstanding amount on the
revolving credit line to $6.0 million by November 17, 1995 and to $5.0
million by November 30, 1995, and to achieve further reductions by year-end
1995, by utilizing cash generated from operations.
At October 1, the Company was in violation of one covenant of the borrowing
agreement because of the net loss incurred for the quarter. The lending
institution has waived this violation for the third quarter; however, as a
result of the covenant violation the lending institution has raised the
lending rates to prime plus 2.0% for the revolving loan, from prime plus
1.25%, and prime plus 2.25% on the term loan, from prime plus 1.50%.
Additionally, similar net loss covenants exist that require the Company
report net income for the fourth quarter and for the fiscal year
ending December 31, 1995. The Company anticipates that it will violate
the covenant requiring net income for the fiscal year. The Company will
work with its lender to seek a waiver of the related covenant. Although
the lending institution waived the similar covenant for the third quarter,
there can be no assurances that such a waiver will be granted in the future.
At period end, shareholders' equity was $33.4 million and the ratio of
debt-to-equity was 0.67 versus equity of $10.8 million and a debt-to-equity
ratio of 3.57 at December 25, 1994. The Company believes that its working
capital and credit facilities, along with cash generated from operations,
will be sufficient to fund its operations for the foreseeable future.
PART II - OTHER INFORMATION
ITEM 2. LEGAL PROCEEDINGS
Subsequent to the end of the quarter, four shareholder suits
were filed against the Company. On October 18, 1995, an action
was filed in the United States District Court, Southern District
of Ohio, Western Division, by Richard Kaufman, individually and
allegedly on behalf of all others similarly situated, against
the Company, James L. Jaeger, Jacques A. Robinson, John W.
Noland, the Company's Directors, Montgomery Securities and Roney
& Co. On October 24, 1995, another action was filed in the
United States District Court, Southern District of Ohio, Western
Division, by Bruce Stumpf and Paul J. O'Reilly, individually and
allegedly on behalf of others similarly situated, against the
same defendants named in the Kaufman suit. Both actions allege
that, in connection with the sale of 4,000,000 Common Shares of
the Company in a public offering in late August 1995, the
defendants had violated various sections of the Securities Act
of 1933 and had made negligent misrepresentations. The
plaintiffs generally seek damages in an amount equal to the
difference between the price paid for the shares purchased in
the public offering and either the current value of such shares,
if currently held, or the price at which such shares were
disposed of in the market, if disposed of before the
commencement of the action; or, alternatively, to rescind the
purchases and recover the consideration paid for the shares or,
if such shares are no longer held by plaintiffs, for unspecified
damages.
On October 18, 1995, an action was filed in the United States
District Court, Southern District of Ohio, Western Division, by
Chesapeake Capital Group, Inc., for itself and allegedly on
behalf of all others similarly situated, against the Company,
James L. Jaeger, Jacques A. Robinson, John W. Noland, Montgomery
Securities and Roney & Co. On November 2, 1995, an action was
filed in the United States District Court, Southern District of
Ohio, Western Division, by Mary Ellen Guthrie and Ronald S.
Rees, individually and allegedly on behalf of all others
similarly situated, against the Company, James L. Jaeger and
Jacques A. Robinson. Both actions allege that, in connection
with the public offering of 4,000,000 Common Shares of the
Company in late August 1995, the defendants had violated
sections of the Securities Exchange Act of 1934. Both
complaints seek unspecified damages to be determined at trial.
The Company is presently evaluating the allegations contained in
these lawsuits.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(b)(1) A Current Report on Form 8-K, dated November 3, 1995,
was filed announcing the Company's estimated operating results
for the Third Quarter ended October 1, 1995 and legal actions
filed against the Company.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, Cincinnati Microwave, Inc. has duly caused this report to
be signed on its behalf by the undersigned thereunto duly
authorized.
November 15, 1995
CINCINNATI MICROWAVE, INC.
by:/ss/Walter P. Masavage
----------------------
Walter P. Masavage
Vice President
Controller
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE BALANCE SHEET AND
RELATED STATEMENT OF OPERATIONS OF CINCINNATI MICROWAVE, INC., FOR THE PERIOD
ENDED OCTOBER 1, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000729583
<NAME> CINCINNATI MICROWAVE, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> DEC-26-1994
<PERIOD-END> OCT-01-1995
<CASH> 922
<SECURITIES> 0
<RECEIVABLES> 16,734
<ALLOWANCES> 234
<INVENTORY> 19,864
<CURRENT-ASSETS> 37,633
<PP&E> 38,785
<DEPRECIATION> 24,590
<TOTAL-ASSETS> 54,375
<CURRENT-LIABILITIES> 19,895
<BONDS> 0
<COMMON> 3,641
0
0
<OTHER-SE> 29,749
<TOTAL-LIABILITY-AND-EQUITY> 54,375
<SALES> 54,782
<TOTAL-REVENUES> 54,782
<CGS> 41,817
<TOTAL-COSTS> 41,817
<OTHER-EXPENSES> 17,513
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 838
<INCOME-PRETAX> (5,440)
<INCOME-TAX> (1,438)
<INCOME-CONTINUING> (4,002)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (4,002)
<EPS-PRIMARY> (0.28)
<EPS-DILUTED> (0.28)
</TABLE>
