UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended September 30, 1996
Commission file Number 1-9457
SHELBY WILLIAMS INDUSTRIES, INC.
(Exact name of registrant as specified in its charter.)
Delaware 62-0974443
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
11-111 Merchandise Mart
Chicago, Illinois 60654
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(312) 527-3593
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 of 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 [ ]
At November 4, 1996, there were 8,750,854 shares of registrant's
common stock outstanding.
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<TABLE>
PART I - FINANCIAL INFORMATION
SHELBY WILLIAMS INDUSTRIES, INC.
Consolidated Statements of Income
Three Months and Nine Months Ended
September 30, 1996 and 1995
(Unaudited)
(Amounts in thousands, except per share data)
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1996 1995 1996 1995
________ ________ ________ ________
<S> <C> <C>
Net sales $43,250 $42,518 $127,532 $124,171
Cost of goods sold 33,345 33,139 98,642 97,115
______ ______ ______ ______
Gross profit 9,905 9,379 28,890 27,056
Selling, general and
administrative
expenses 6,433 6,502 19,340 19,473
______ ______ ______ ______
3,472 2,877 9,550 7,583
Other deductions
(income):
Interest expense 253 319 807 952
Interest and dividend
income (2) (6) (4) (8)
Miscellaneous
income (14) (28) (2) (31)
______ ______ ______ ______
237 285 801 913
______ ______ ______ ______
Income before income
taxes 3,235 2,592 8,749 6,670
______ ______ ______ ______
Income taxes:
Current 976 659 2,594 1,591
Deferred 59 59 178 178
______ ______ ______ ______
1,035 718 2,772 1,769
______ ______ ______ ______
Net income $ 2,200 $ 1,874 $ 5,977 $ 4,901
====== ====== ====== ======
Net income per share $ .25 $ .21 $ .68 $ .55
====== ====== ====== ======
Weighted average number
of common shares
outstanding 8,758 8,952 8,820 8,967
====== ====== ====== ======
<FN>
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<TABLE>
SHELBY WILLIAMS INDUSTRIES, INC.
Consolidated Balance Sheets
September 30, 1996 and December 31, 1995
(Unaudited)
(Amounts in thousands, except per share data)
<CAPTION>
September 30, 1996 December 31, 1995
_______________ _________________
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 1,676 $ 2,376
Accounts receivable, less
allowance for doubtful
accounts of $400 at
September 30, 1996 and
$423 at December 31,
1995 23,856 25,198
Inventories:
Raw materials 13,338 12,349
Work in process 3,243 4,598
Finished goods 12,384 11,488
______ ______
28,965 28,435
Prepaid expense 3,930 3,247
______ ______
Total current assets 58,427 59,256
Excess of cost over net assets
of acquired company 171 178
Property, plant and equipment
at cost:
Land and land improvements 2,930 2,876
Buildings and leasehold
improvements 22,942 25,408
Machinery and equipment 23,991 25,029
Construction in progress 18 -
______ ______
49,881 53,313
Less accumulated
depreciation and
amortization 23,576 24,082
______ ______
26,305 29,231
Other assets 1,808 1,242
______ ______
$86,711 $89,907
====== ======
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
Current liabilities:
Short-term borrowings $ 2,800 $ 5,900
Accounts payable 9,670 10,425
Customer deposits on
orders in process 4,609 3,245
Accrued liabilities 4,712 6,787
Income taxes 659 828
Current portion of long-
term debt -0- 55
______ ______
Total current liabilities 22,450 27,240
Long-term debt 8,000 8,840
Deferred income taxes 2,281 2,103
Stockholder's equity:
Common stock, $.05 par value;
authorized 30,000 shares;
issued 11,792 shares
(1995-11,779) 590 589
Capital in excess of par value 7,969 7,855
Retained earnings 67,431 63,398
Pension liability adjustment (908) (908)
______ ______
75,082 70,934
Less common stock held in
treasury; 3,044 shares
at cost (1995-2,879) 21,102 19,210
______ ______
Total stockholders' equity 53,980 51,724
______ ______
$86,711 $89,907
====== ======
<FN>
</TABLE>
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<TABLE>
SHELBY WILLIAMS INDUSTRIES, INC.
Consolidated Statements of Cash Flows
Nine Months Ended September 30, 1996 and 1995
(Unaudited)
(Amounts in thousands)
<CAPTION>
1996 1995
___________________________
<S> <C> <C>
Cash flows from operating activities:
Net income $5,977 $4,901
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amoritzation 2,065 2,135
Provision for losses on accounts
receivable 43 174
Change in assets and liabilities net
of effects from sale of facility:
Accounts receivable 1,299 (1,902)
Inventories (2,131) (1,280)
Prepaid expenses (819) (716)
Accounts payable and accrued
liabilities (1,366) 1,965
Income taxes payable (169) 772
Increase in deferred taxes 178 178
Other 16 (29)
_____ _____
Net cash provided by operating
activities 5,093 6,198
_____ _____
Cash flows from investing activities:
Proceeds from disposal of property,
plant and equipment 5 128
Proceeds from sale of facility 2,000 -
Capital expenditures (945) (1,707)
_____ _____
Net cash provided (used) by
investing activities 1,060 (1,579)
_____ _____
Cash flows from financing activities:
Net repayment of short-term
borrowings (3,100) (1,750)
Principal payments of long-term debt (32) (37)
Sale of common stock under stock
option plan 115 140
Purchase of common stock for the
treasury (1,892) (591)
Dividends declared and paid (1,944) (1,885)
_____ _____
Net cash used by financing activities (6,853) (4,123)
_____ _____
Net increase (decrease) in cash and
cash equivalents (700) 496
Cash and cash equivalents at beginning
of period 2,376 1,633
_____ _____
Cash and cash equivalents at end of
period $1,676 $2,129
===== =====
Supplemental cash flow information:
Cash paid during the period for:
Interest $ 799 $ 950
Income taxes 2,763 819
_____ _____
$3,562 $1,769
===== =====
<FN>
</TABLE>
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SHELBY WILLIAMS INDUSTRIES, INC.
[PERIOD] September 30, 1996
Item 1. Financial Statements
The attached unaudited statements include all adjustments which are, in
the opinion of management, necessary to a fair statement of the results for
the interim periods presented. All such adjustments are of a normal recur-
ring nature. The statements are as follows:
Consolidated Statements of Income for three months and for
nine months ended September 30, 1996 and 1995.
Consoldiated Balance Sheets at September 30, 1996 and December 31,
1995.
Consolidated Statements of Cash Flows for nine months ended
September 30, 1996 and 1995.
Item 2. Managements' Discussion and Analysis of Financial Condition
and Results of Operations
Material Changes in Financial Condition
The Company made changes in its product and manufacturing strategies
during December 1994, designed to make the Company more competitive in the
industry. The plan was to exit certain portions of the Company's enterprise
by selling an upholstery business with a related manufacturing facility and
discontinuing a part of the product lines in the health care, university and
office markets, resulting in closure of another plant. The Company antici-
pated completing the restructuring by December 31, 1995; however, the sale
of the upholstery business was not completed until August 1996. The planned
discontinuance of a part of the product lines in the health care, university
and office markets was completed in 1995 resulting in the reduction of
operations of that plant by approximately 75 percent. The Company planned
to move the remaining production to other facilities and close the plant
by September 30, 1996, but changing economic conditions, particularly labor
shortages at those facilities, necessitated changing the plan to continue
the reduced level of production, which is mainly in a portion of the plant
owned by the Company. The minor change does not affect the original
restructuring provision.
During the first nine months of 1996, the Company reduced short-term
borrowings by $3.1 million of which $2.0 million was provided by the sale
of the upholstery business and related facility indicated above. There
were no major capital expenditures during this period and none are planned
for the remainder of 1996. Stockholders' equity per share of $6.16 was up
7.7 percent from $5.72 per share, a year earlier. The Company's current
ratio at September 30, 1996 was a conservative 2.6-to-1.
Material Changes in Results of Operations
Sales for the quarter ended September 30, 1996 increased 1.7 percent to
$43,250,000 from $42,518,000 in the third quarter of 1995, due to increased
volume despite the sale of the upholstery business referred to above.
Pre-tax income in the quarter increased 24.8 percent to $3,235,000, or 7.5
percent of sales, compared to $2,592,000, or 6.1 percent of sales, in the
third quarter 1995 of which approximately one-fourth of the improvement
as a percent of sales resulted from selling the marginally profitable
upholstery business. The remaining improvement was primarily due to better
operating efficiencies and function of volume. Because of tax credits no
longer available, the effective tax rate increased 4.3 percent. Net income
increased 17.4 percent, and income per share of $.25 for the quarter in-
creased 19.0 percent from $.21 in the same period in 1995.
Sales for the nine months ended September 30, 1996 increased 2.7
percent to $127.5 million from $124.2 million in the same period of 1995.
Net income was $6.0 million, a 22.0 percent increase over $4.9 million,
while earnings per share of $.68 for the first nine months of 1996 in-
creased 23.6 percent from $.55 in the same period of 1995.
The Company's backlog of unshipped orders at September 30, 1996 was
$35.1 million, up 20 percent over last year.
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
27 Financial Data Schedule (EDGAR only).
b. Reports on Form 8-K
No reports have been filed on Form 8-K during this
quarter.
SHELBY WILLIAMS INDUSTRIES, INC.
SIGNATURES
Pursuant to the requirement 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.
<PAGE>
SHELBY WILLIAMS INDUSTRIES, INC.
(Registrant)
November 4, 1996 S/Robert P. Coulter
__________________________________
Robert P. Coulter
President and Director
(Principal Operating Officer)
November 4, 1996 S/Sam Ferrell
_________________________________
Sam Ferrell
Vice President of Finance, Treasurer
and Assistant Secretary
(Principal Financial Officer)
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S>
<FISCAL-YEAR-END> Dec-31-1995
<PERIOD-END> September-30-1996
<PERIOD-TYPE> 9-mos
<CASH> 1,676
<SECURITIES> 0
<RECEIVABLES> 24,256
<ALLOWANCES> 400
<INVENTORY> 28,965
<CURRENT-ASSETS> 58,427
<PP&E> 49,881
<DEPRECIATION> 23,576
<TOTAL-ASSETS> 86,711
<CURRENT-LIABILITIES> 22,450
<BONDS> 0
0
0
<COMMON> 590
<OTHER-SE> 53,390
<TOTAL-LIABILITY-AND-EQUITY> 86,711
<SALES> 127,532
<TOTAL-COSTS> 98,642
<OTHER-EXPENSES> 19,340
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 807
<INCOME-PRETAX> 8,749
<INCOME-TAX> 2,772
<INCOME-CONTINUING> 5,977
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,977
<EPS-PRIMARY> .68
<EPS-DILUTED> .68
</TABLE>
