SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(MARK ONE)
(X) Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended June 30, 1996
or
( ) Transition Report Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934 (No Fee Required)
Commission File No. 0-12718
SUPERTEX, INC.
(Exact name of Registrant as specified in its Charter)
California 94-2328535
(State or other jurisdiction of (IRS Employer Identification #)
incorporation or organization)
1235 Bordeaux Drive
Sunnyvale, California 94089
(Address of principal executive offices)
Registrant's Telephone Number, Including Area Code: (408) 744-0100
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common Stock
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 ( )
As of July 23, 1996, 11,992,881 shares of the Registrant's
common stock were issued and outstanding.
Total number of pages: 10
<PAGE>
SUPERTEX, INC.
QUARTERLY REPORT - FORM 10Q
Table of Contents
- ----------------- Page No.
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements ................................. 3
Consolidated Statements of Income ................... 3
Consolidated Balance Sheets ......................... 4
Consolidated Statements of Cash Flows ............... 5
Notes to Consolidated Financial Statements .......... 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations .................. 7
PART II- OTHER INFORMATION
Item 6. Exhibits, Financial Statement Schedule
and Reports on Form 8-K .............................. 8
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
SUPERTEX, INC.
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(in thousands, except per share amounts)
<CAPTION>
Three-months Ended
-----------------------------
June 30, 1996 June 30, 1995
------------- -------------
<S> <C> <C>
Net sales $ 12,461 $ 9,157
Cost and expenses:
Cost of sales 6,310 4,681
Research and development 1,310 1,282
Selling, general and administrative 1,594 1,263
-------- --------
Total costs and expenses 9,214 7,226
-------- --------
Income from operations 3,247 1,931
Interest income 367 312
Other income, net -- 27
-------- --------
Income before provision for income taxes 3,614 2,270
Provision for income taxes 1,156 704
Net income $ 2,458 $ 1,566
======== ========
Net income per share $ 0.20 $ 0.13
======== ========
Shares used in per share computation 12,495 12,246
======== ========
<FN>
See accompanying Notes to Consolidated Financial Statements.
</TABLE>
<PAGE>
<TABLE>
SUPERTEX, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
<CAPTION>
Jun. 30, 1996 Mar. 31, 1996
------------- -------------
(unaudited)
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $ 8,903 $ 16,108
Short term investments 15,144 6,281
Trade accounts receivable,
net of allowances of $372 and $559 8,777 7,823
Other receivables 149 81
Inventories 7,152 7,254
Deferred income taxes 1,241 1,241
Prepaid expenses 848 174
-------- --------
Total current assets 42,214 38,962
Property and equipment, net 6,561 6,466
-------- --------
TOTAL ASSETS $ 48,775 $ 45,428
======== ========
</TABLE>
<TABLE>
LIABILITIES
<CAPTION>
Current liabilities:
<S> <C> <C>
Trade accounts payable $ 2,725 $ 3,357
Accrued salaries, wages and employee benefits 1,728 1,723
Income taxes payable 1,608 638
Other accrued liabilities 443 314
Deferred revenue on shipments to distributors 952 733
-------- --------
Total current liabilities 7,456 6,765
-------- --------
SHAREHOLDERS' EQUITY
Preferred stock, no par value --
10,000,000 shares authorized, none outstanding -- --
Common stock, no par value -- 30,000,000
shares authorized; issued and outstanding
11,991,881 and 11,935,671 shares 18,907 18,709
Retained earnings 22,412 19,954
-------- --------
Total shareholders' equity 41,319 38,663
-------- --------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 48,775 $ 45,428
======== ========
<FN>
See accompanying Notes to Consolidated Financial Statements.
</TABLE>
<PAGE>
<TABLE>
SUPERTEX, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in thousands)
<CAPTION>
Three Months Ended
------------------
CASH FLOWS FROM OPERATING ACTIVITIES June 30, 1996 June 30, 1995
------------- -------------
<S> <C> <C>
Net income $ 2,458 $ 1,566
Non-cash adjustments to net income:
Depreciation and amortization 435 320
Provision for doubtful accounts
and sales returns 278 (10)
Provision for excess and obsolete inventories 15 383
Changes in operating assets and liabilities:
Accounts and other receivables (1,300) (50)
Inventories 87 (514)
Prepaid expenses (674) (62)
Trade accounts payable and accrued expenses (498) (664)
Income taxes payable 970 667
Deferred revenue on shipments to distributors 219 90
------- -------
Total adjustments (468) 160
------- -------
Net cash provided by operating activities 1,990 1,726
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment (530) (484)
Purchases of short term investments (15,137) (11,502)
Proceeds from maturities of
short term investments 6,274 10,000
------- -------
Net cash used in investing activities (9,393) (1,986)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES
Stock options exercised 198 1
------- -------
Net cash provided by financing activities 198 1
------- -------
NET DECREASE IN CASH AND CASH EQUIVALENTS (7,205) (259)
CASH AND CASH EQUIVALENTS:
Beginning of period 16,108 4,437
------- -------
End of period $ 8,903 $ 4,178
======= =======
<FN>
See accompanying Notes to Consolidated Financial Statements.
</TABLE>
<PAGE>
SUPERTEX, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1
- ------
In the opinion of management, the unaudited financial statements
for the three months ended June 30, 1996 and 1995 include all
adjustments (consisting of normal recurring adjustments)
necessary for fair presentation of financial condition and
results of operations for those periods in accordance with
generally accepted accounting principles.
The year-end condensed balance sheet data was derived from
audited financial statements, but does not include all
disclosures required by generally accepted accounting
principles. These financial statements should be read in
conjunction with the audited financial statements of Supertex,
Inc. for the fiscal year ended March 31, 1996, which were
included in the Annual Report on Form 10-K (File Number 0-12718).
Interim results are not necessarily indicative of results for
the full fiscal year.
Inventories consisted of (in thousands):
June 30, 1996 March 31, 1996
------------- --------------
(unaudited)
Finished goods .............................. $ 1,664 $ 1,366
Work-in-process ............................. 4,276 4,122
Raw materials ............................... 1,212 1,766
------- -------
$ 7,152 $ 7,254
======= =======
During October 1995, the Financial Accounting Standards Board
issued Statement No. 123, "Accounting for Stock-Based
Compensation" (SFAS 123), which establishes a fair value based
method of accounting for stock-based compensation plans. The
Company is currently following the requirements of Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to
Employees." The Company plans to adopt SFAS 123 during fiscal
1997 utilizing the disclosure alternative.
During March 1995, the Financial Accounting Standards Board
issued Statement No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed of"
(SFAS 121), which requires the Company to review for impairment
of long-lived assets, certain identifiable intangibles and
goodwill related to those assets whenever events or changes in
circumstances indicate that the carrying amount of an asset may
not be recoverable. SFAS 121 will become effective for the
Company's 1997 fiscal year. The Company does not expect SFAS
121 to have a material impact on the Company's financial
condition or results of operations.
<PAGE>
PART I - FINANCIAL INFORMATION
Item 2 - Management's Discussion and Analysis of Financial
Condition and Results of Operations
Certain Factors - This report contains forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933
and Section 21E of the Securities Act of 1934. Actual results
could differ materially from those projected in the
forward-looking statements as a result of the risk factors set
forth below and elsewhere in this report. The Company's sales
are concentrated in the high voltage semiconductor components
industry, which is highly competitive and rapidly changing.
Significant technological changes in the industry, changes in
customer requirements or the emergence of competitor products
with new capabilities or technologies could affect the Company's
operating results adversely. The Company currently buys all of
its silicon wafers, an integral component of its products, from
one supplier. Failure by this supplier to satisfy the Company's
requirements on a timely basis at competitive prices could cause
a delay in manufacturing and a possible loss of revenues, which
would affect operating results adversely.
Results of Operations
Net Sales - Net sales for the quarter ended June 30, 1996 of
$12,461,000 were up 36% from $9,157,000 of the same period last
year. Sales of new products and continued strength in existing
products in the Company's targeted markets of medical ultrasound
imaging, telecommunications, and flat panel displays contributed
to this increase.
Gross Profit - Gross profit for the quarter was $6,151,000,
compared with $4,476,000 in the same quarter of last year.
Manufacturing costs, at 51% of net sales for the first quarter
of both years, has been relatively stable due to cost controls.
Research and Development - Research and development expenses were
$1,310,000 this year as compared with $1,282,000 last year. As
a percentage of net sales, research and development expenses
dropped from 14% to 11% as some new products were transferred to
production. The Company intends to continue to invest heavily
in its new product and process development efforts.
Selling, General and Administrative - Expenses for selling,
general and administrative were $1,594,000, or 13% of net sales,
compared with $1,263,000, or 14% of net sales, in the last
fiscal year. The dollar increase in this category was due to a
slight increase in payroll and related benefits as a result of
an increase in headcount, as well as an increase in sales
commissions from the increased business activities.
Interest Income - Interest and other income for this period were
$367,000 compared with $339,000 last year. Increased cash
available for investments, offset by slightly lower interest
rates contributed to this small increase in interest income.
There was no other income for this period.
Provision for Income Taxes - The Company's effective tax rate for
the three months ended June 30, 1996 was 32%, an increase from
31% for the same period of last fiscal year.
Liquidity and Capital Resources - On June 30, 1996, the Company
had $24,047,000 in cash, cash equivalents and short term
investments, compared with $22,389,000 on March 31, 1996. This
increase is mostly due to positive cash flow from operating
activities consisting principally of net income and an increase
in liability accounts, and partially offset by an increase in
receivables. Net cash used in investing activities in the first
quarter of 1996 was $9,393,000, which consisted mainly of
purchases of short-term investments. Net cash provided by
financing activities was $198,000 from the proceeds of stock
option exercises.
The Company anticipates that available funds and cash expected
to be generated from operations will be sufficient to meet cash
and working capital requirements through the end of fiscal year
1997. The Company expects to spend approximately $11,700,000
for capital acquisitions during fiscal year 1997.
Recent Accounting Pronouncements - During October 1995, the
Financial Accounting Standards Board issued Statement No. 123,
"Accounting for Stock-Based Compensation" (SFAS 123), which
establishes a fair value based method of accounting for
stock-based compensation plans. The Company is currently
following the requirements of Accounting
<PAGE>
Principles Board Opinion No. 25, "Accounting for Stock Issued to
Employees". The Company plans to adopt SFAS 123 during fiscal
1997 utilizing the disclosure alternative.
During March 1995, the Financial Accounting Standards Board
issued Statement No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed of"
(SFAS 121), which requires the Company to review for impairment
of long-lived assets, certain identifiable intangibles and
goodwill related to those assets whenever events or changes in
circumstances indicate that the carrying amount of an asset may
not be recoverable. SFAS 121 will become effective for the
Company's 1997 fiscal year. The Company does not expect SFAS
121 to have a material impact on the Company's financial
condition or results of operations.
PART II - OTHER INFORMATION
Item 6. - Exhibits and Reports on Form 8-K
(a) Exhibits
11.1 Statement Regarding Computation of Net Income Per Share
27.1 Financial Data Schedule
(b) Reports on Form 8-K.
None.
SIGNATURE
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.
SUPERTEX, INC.
(Registrant)
Date: July 24, 1996
By: /s/ Henry C. Pao
---------------------
Dr. Henry C. Pao, President
(Principal Executive and
Financial Officer)
<PAGE>
<TABLE>
Exhibit 11.1
Supertex, Inc.
Statement Regarding Computation of Net Income Per Share
(in thousands, except per share data)
<CAPTION>
Three Months Ended
June 30,
1996 1995
------ ------
(unaudited)
<S> <C> <C>
PRIMARY:
Weighted Average Shares Outstanding 11,965 11,895
Common Stock Equivalents 530 351
------- -------
Total common and common equivalent shares 12,495 12,246
======= =======
Net income $ 2,458 $ 1,566
======= =======
Net income per share $ 0.20 $ 0.13
======= =======
FULLY DILUTED:
Weighted Average Shares Outstanding 11,965 11,895
Dilutive employee stock options 530 373
------- -------
Total common and common equivalent shares 12,495 12,268
======= =======
Net income $ 2,458 $ 1,566
======= =======
Net income per share $ 0.20 $ 0.13
======= =======
<FN>
Net income per share in the consolidated financial statements is
presented under the primary basis as the effect of dilution
under the fully diluted basis is not material.
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-30-1997
<PERIOD-END> JUN-30-1996
<CASH> 8,903
<SECURITIES> 0
<RECEIVABLES> 9,149
<ALLOWANCES> 372
<INVENTORY> 7,152
<CURRENT-ASSETS> 42,214
<PP&E> 18,704
<DEPRECIATION> 12,143
<TOTAL-ASSETS> 48,775
<CURRENT-LIABILITIES> 7,456
<BONDS> 0
0
0
<COMMON> 18,907
<OTHER-SE> 22,412
<TOTAL-LIABILITY-AND-EQUITY> 48,775
<SALES> 12,461
<TOTAL-REVENUES> 12,461
<CGS> 6,310
<TOTAL-COSTS> 9,214
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 12
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 3,614
<INCOME-TAX> 1,156
<INCOME-CONTINUING> 2,458
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,458
<EPS-PRIMARY> .20
<EPS-DILUTED> .20
</TABLE>
