FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarter Ended September 29, 1995
Commission File Number 0-13914
TRIO-TECH INTERNATIONAL
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(Exact name of Registrant as specified in its Charter)
California 95-2086631
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
355 Parkside Drive, San Fernando, California 91340
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(Address of principle executive offices) (Zip Code)
Registrant's Telephone Number: 818-365-9200
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed with the Commission 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
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As of October 31, 1995, the Registrant had outstanding approximately 1,192,702*
Shares of Common Stock.
* See PART II. OTHER INFORMATION, ITEM 2 in connection with a 1-for-4
reverse stock split, whose effective date of record was October 13,
1994.
This document contains a total of 8 pages.
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<CAPTION>
ITEM 1. FINANCIAL STATEMENTS
TRIO-TECH INTERNATIONAL
(Condensed Consolidated Balance Sheet)
(unaudited)
(In Thousands)
Sep. 29 Jun. 30,
1995 1995
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<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash $ 885 $ 674
Certificates of deposit 1,050 553
Accounts receivable - net 5,086 4,140
Notes & other receivables 178 186
Inventories 1,260 1,192
Prepaid expenses 235 103
-------- --------
Total current assets 8,694 6,848
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PROPERTY, EQUIPMENT AND CAPITALIZED LEASES, NET 5,229 5,265
OTHER ASSETS 457 533
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TOTAL ASSETS $ 14,380 $ 12,646
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable $ 40 $ 219
Accounts payable 2,238 1,643
Accrued expenses 2,502 2,246
Income taxes payable 941 592
Current portion of long-term debt and 420 459
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capitalized leases
Total current liabilities 6,141 5,159
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LONG-TERM DEBT AND CAPITALIZED LEASES,
Net of current portion 556 597
DEFERRED TAXES 844 870
MINORITY INTEREST 2,092 1,601
SHAREHOLDERS' EQUITY:
Common stock; authorized, 2,500,000 shares;
issued and outstanding, 1,181,002
shares at September 29, 1995
and June 30, 1995 stated at 4,822 4,822
Accumulated deficit (2,022) (2,142)
Cumulative currency translation 1,947 1,739
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Total shareholders' equity 4,747 4,419
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 14,380 $ 12,646
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</TABLE>
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
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<TABLE>
<CAPTION>
TRIO-TECH INTERNATIONAL
(Condensed Consolidated Statement of Income)
(unaudited)
(In Thousands, except Earnings per Share Data)
THREE MONTHS ENDED
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SEP. 29, SEP. 30,
1995 1994
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<S> <C> <C>
Revenues $ 5,733 $ 4,108
Cost of revenues 3,721 2,792
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Gross profit 2,012 1,316
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Selling, general & administrative expenses 1,275 1,230
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Income from operations 737 86
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Other income (expense):
Interest expense (41) (45)
Other income (expense) 184 215
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Total 43 170
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Income before income taxes and minority interest 880 256
Income taxes 360 139
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Income before minority interest 520 117
Minority interest 400 82
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Net income $ 120 $ 35
======== ========
Net income per share:
Primary $ 0.08 $ 0.03
Fully diluted $ 0.06 $ 0.03
Weighted average number of shares outstanding
Primary 1,594,558 1,159,598
Fully diluted 1,950,567 1,159,598
</TABLE>
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
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<TABLE>
<CAPTION>
TRIO-TECH INTERNATIONAL
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unadited)
(In Thousands)
THREE MONTHS ENDED
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SEP. 29, SEP. 30,
1995 1994
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<S> <C> <C>
Net income $ 120 $ 35
Cash flows from operating activities:
Adjustments to reconcile net income to
Cash provided by operations:
Depreciation and amoritization 140 286
Effect of exchange rate changes on
Operating assets 82 27
Changes in assets and liabilities:
Accounts receivable, net (946) 163
Notes and other receivables 8 (153)
Inventories (68) (265)
Prepaid expenses & other current assets (132) (40)
Other assets 60 (3)
Accounts payable and accrued expenses 1,200 88
Deferred taxes (26) 20
Net cash provided by operating activities 438 158
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Cash flows from investing activities:
Certificates of deposit (497) 280
Capital expenditures, net (88) (512)
Minority interest 587 72
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Net cash provided by investing activities 2 160)
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Cash flows from financing activities:
Payments on notes payable and lines of credit (179) 40
Proceeds from long-term debt and
capitalized leases 19 15
Principal payments of long-term debt
capitalized leases (99) (133)
Issuance of common stock 3
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Net cash used in financing activities (259) (75)
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Effect of exchange rate on cash 30 20
Net increase (decrease) in cash 211 (57)
Cash, beginning of the period 674 521
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Cash , end of the period $ 885 $ 464
========= =========
Supplemental disclosure of cash flow information
Cash paid during the period for:
Interest paid $ 39 $ 40
Taxes paid $ 25 $ 31
</TABLE>
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
<PAGE>
TRIO-TECH INTERNATIONAL
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. Basis of Presentation
The financial information included herein is unaudited; however, such
information reflects all adjustments (consisting solely of normal recurring
adjustments) which are, in the opinion of management, necessary for the fair
statement of results for the interim periods.
The results of operations for the three month period ended September 29, 1995 is
not necessarily indicative of the results expected for the full year.
NOTE 2. Inventories
The composition of inventories is as follows (in thousands):
Sept.29, June 30,
1995 1995
------------ -----------
Raw Materials $ 589 $ 559
Work in Process 316 403
Finished Goods 355 230
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Total $ 1,260 $ 1,192
============ ============
NOTE 3. Other Assets
The composition of other assets is as follows (in thousands):
Sept. 29, June 30,
1995 1995
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Goodwill (net of amortization)$ 281 $ 301
Other Assets 176 232
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Total $ 457 $ 533
=========== =============
NOTE 4. Common Stock
In October, 1994 the Board of Directors approved a one-for-four reverse stock
split. Common stock and stock options have been retroactively adjusted for the
split.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
1. Liquidity and Capital Resources
The Company's working capital improved $ 864,000 during the first quarter. This
is due to improvement in sales and profitability.
The Company's subsidiary, TTI Pte, has a secured credit agreement with a bank
which provides for a total line of credit of $ 655,000. The Company's
subsidiary, TTM, has a secured credit agreement with a bank which provides for a
total line of credit of $234,000. There were no borrowings under these lines as
of September 29, 1995. There is no current financing available to fund
operations outside of the far east region.
2. Material Changes in Financial Position
There were no material changes in the financial position of the Company during
the three month period ending September 29, 1995.
3. Material Changes in Results of Operations
(a) Comparison of the Three Month Period Ending September 29,
1995 and September 30, 1994.
The Company recorded $ 120,000 of profit during the first quarter ($ 35,000 for
the three months ended September 30, 1994). Sales have increased by 40% in the
three month period ending September 29, 1995 as compared to the corresponding
period in the previous year. Gross margins have improved by 3% to 35% for the
period ended September 29, 1995, as compared to 32% for the corresponding period
in the previous year. Selling, general and administrative expenses have
increased $45,000 (4%) as a result of the increase in sales activity and have
decreased as a percentage to sales to 22% for the three months ended September
29, 1995, as compared to 30% for the three months ended September 30, 1994.
Interest expenses have declined as a result of a reduction in borrowings against
a line of credit. Other income decreased $ 31,000 due to a decrease in realized
and unrealized gains. Minority interest has increased significantly mainly due
to the improved performance from the Malaysia operations.
PART II. OTHER INFORMATION
Item 2. Changes in securities.
A reverse stock split (the "Reverse Split" ) of the common stock was confirmed
with a date of record for determining the Stockholders entitled to participate
in the Reverse Split of October 13, 1994. The Reverse Split was a 1-for-4
reverse stock split whereby each outstanding share of existing common stock was
automatically converted into one-fourth of a share of common stock. Fractional
interests resulting from the Reverse Split were rounded up to the nearest whole
share, with half-shares being rounded up to the next whole number. For example,
a person holding 101 shares prior to the Reverse Split would now hold 25 shares,
the remaining 1/4 share having been canceled and disregarded; persons holding
102 or 103 shares received 26 full shares after the Reverse Split. As of
January 31,
<PAGE>
1994 3,724,000 shares had been delivered to the Transfer Agent for the new
stock certificates. The Company approximates the number of currently
outstanding shares to be 1,192,702.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TRIO-TECH INTERNATIONAL
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Registrant
By A. Charles Wilson /s/
-----------------------------------------
A. Charles Wilson
Chairman
Dated: November 9, 1995
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<CAPTION>
TRIO-TECH INTERNATIONAL
EXHIBIT 11.1
STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS
(unaudited)
(in thousands, except per share data)
THREE MONTHS ENDED
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SEP. 29, SEP. 30,
1995 1994
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<S> <C> <C>
Net income $ 120 $ 35
Primary earnings per share:
Weighted average number of common shares
outstanding 1,181 1,152
Dilutive effect of stock options and
warrants after application
of treasury stock method 414 8
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Number of shares used to compute primary
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earnings per share
1,595 1,160
======== ========
Primary earnings per share:
Net income per share $ 0.08 $ 0.03
======== ========
Fully diluted earnings per share:
THREE MONTHS ENDED
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Weighted average number of common shares
outstanding 1,181 1,152
Dilutive effect of stock options and
warrants after application
of treasury stock method 770 8
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Number of shares used to compute fully diluted
earnings per share 1,951 1,160
======== ========
Fully diluted earnings per share:
Net income per share $ 0.06 $ 0.03
======== ========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000732026
<NAME> TRIO-TECH INTERNATIONAL
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-29-1996
<PERIOD-START> JUN-30-1995
<PERIOD-END> SEP-29-1995
<CASH> 885
<SECURITIES> 1050
<RECEIVABLES> 5086
<ALLOWANCES> 0
<INVENTORY> 1260
<CURRENT-ASSETS> 8694
<PP&E> 17200
<DEPRECIATION> (11970)
<TOTAL-ASSETS> 14380
<CURRENT-LIABILITIES> 6141
<BONDS> 0
<COMMON> 4822
0
0
<OTHER-SE> (75)
<TOTAL-LIABILITY-AND-EQUITY> 14380
<SALES> 5733
<TOTAL-REVENUES> 5733
<CGS> 3721
<TOTAL-COSTS> 1675
<OTHER-EXPENSES> (184)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 41
<INCOME-PRETAX> 480
<INCOME-TAX> 360
<INCOME-CONTINUING> 120
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 120
<EPS-PRIMARY> 0.08
<EPS-DILUTED> 0.06
</TABLE>
