UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) February 21, 1996
OEA,INC.
(Exact name of registrant as specified in its charter)
Delaware 1-6711 36-2362379
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
P. O. Box 100488, Denver, Colorado 80250
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (303) 693-1248
(Former name or former address, if changed since last report)
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Item 1. Changes in Control of Registrant
None
Item 2. Acquisition or Disposition of Assets
None
Item 3. Bankruptcy or Receivership
None
Item 4. Changes in Registrant's Certifying Accountant
None
Item 5. Other Events
The information set forth in this Report constitutes a forward-looking
statement as defined in Section 27A of the Securities Act of 1933, Rule 175
promulgated by the Securities and Exchange Commission thereunder and Section 21E
of the Securities Exchange Act of 1934.
The Registrant has established the business goals set forth in Exhibit A to this
Report (the "Business Goals"). The Registrant believes that the Business Goals
are reasonable. However, they are based on assumptions as to future events and
are therefore inherently uncertain. There can be no assurance that the
Registrant will achieve the Business Goals. Among others, the following
important factors may cause the Registrant's actual results to differ materially
from the Business Goals.
Importance of New Automotive Safety Product Lines.
The Registrant's automotive safety products have historically consisted of
initiators which were sold to other companies for incorporation into inflators
and ultimately into air bag modules. The Registrant has completed the prototype
phase for smokeless hybrid inflators for passenger, driver and side-impact air
bag modules and is in the process of constructing manufacturing facilities to
produce its new inflators. High-volume production of the new smokeless hybrid
inflators is scheduled to begin in April 1996.
A significant portion of the sales and earnings contemplated by the Business
Goals are attributable to inflator sales. The importance of inflator sales
increases over time, from approximately 9% of sales in 1996 to approximately 68%
of sales in 1999. These increasing sales in future years will depend upon the
Registrant's success in manufacturing inflators which meet the expectations of
its customers in 1997 and increasing its penetration of the inflator market over
time.
The Registrant is significantly expanding its facilities to support production
of the smokeless hybrid inflators. While the Registrant has ordered equipment
from suppliers experienced in the manufacture of automotive high-rate production
equipment, no assurance can be given that the equipment will perform as designed
and at the capacity required until the equipment has been operated for a period
of time. In addition, any new manufacturing operation has the risk of unexpected
problems that could delay the commencement or increase the cost of production.
Nature of Business Goals.
The Business Goals are based on predictions of future events that grow
increasingly uncertain over the period covered. Although the Registrant receives
purchase agreements from automotive customers for a year or more in advance,
actual orders are placed on a monthly basis. There can be no assurance that the
Registrant will actually receive projected orders. Orders for the Registrant's
aerospace division are usually firm for approximately 12 months (subject to the
right of the government to cancel or renegotiate orders).
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The 1996 sales figures in the Business Goals are based on projected orders
from existing automotive customers and backlog for the aerospace division.
However, the sales figures for 1997 and subsequent years are based primarily on
the Registrant's expectations as to the orders that will be received in the
future, as to which there can be no assurance. The Registrant's receipt of
orders in subsequent years will depend upon its success in meeting its
customers' needs in the earlier years and on then prevailing market conditions.
Those factors could result in higher or lower sales than are contemplated by the
Business Goals.
Technological and Industry Changes.
The Registrant believes that its smokeless hybrid inflator represents the
most advanced technology currently available. However, future technological
changes could give competitors an advantage and adversely impact the
Registrant's sales. In addition, one or more module manufacturers or automobile
companies, including the Registrant's current and expected customers, could
decide to manufacture inflators or initiators for their own use or to acquire
them from another supplier for reasons unrelated to the technical merits of the
Registrant's inflators.
Item 6. Resignation of Registrant's Directors
None
Item 7. Financial Statements and Exhibits
None
Item 8. Change in Fiscal Year
None
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EXHIBIT A
BUSINESS GOALS
FY '96 FY '97 FY '98 FY '99
------ ------ ------ ------
NUMBER OF INITIATORS SOLD
OUTSIDE OEA (1) 20MM 20MM 20MM 28MM (2)
NUMBER OF INFLATORS .01MM 3MM 6MM 11MM
TOTAL SALES (3) $160MM $230MM $300MM $380MM
TOTAL EPS (3) $1.40 $1.85 $2.25 $2.75
(1) Excludes sales to OEA Inflator Group.
(2) Introduces OEA $1.70 initiator; 40MM planned for FY 2001.
(3) Includes Aerospace.
BUSINESS GOALS
FY '96 FY 2001
------ -------
SALES $160MM $531MM
NET PROFIT $ 29MM $ 82MM
EPS $1.40 $4.00
CAPITAL EXPENDITURES $ 45MM $ 30MM
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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 hereunto duly authorized.
OEA, INC.
---------------------
(Registrant)
February 21, 1996 Paul J. Martin
- ----------------- -------------------
Date Paul J. Martin
Vice President/Treasurer
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