<PAGE> 1
INDEX TO EXHIBITS - PAGE 15 OF 18
UNITED STATES
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 FEBRUARY 29, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from to
---------------- ----------------
Commission file number 0-14057
----------------
[MET-COIL LOGO]
MET-COIL SYSTEMS CORPORATION
- --------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 42-1027215
---------------------
(State or Other Jurisdiction of Incorporation) (I.R.S. Employer No.)
5486 SIXTH STREET SW, CEDAR RAPIDS, IA 52404
---------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: 319-363-6566
NOT APPLICABLE
- --------------------------------------------------------------------------------
(Former Name, Former Address and Former Fiscal Year,
If Changed Since Last Report)
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
-------- --------
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: As of March 31, 2000, there
were 4,465,075 shares of common stock, par value .01 per share, outstanding.
<PAGE> 2
Page 2 of 18
MET-COIL SYSTEMS CORPORATION
INDEX
PART I. FINANCIAL INFORMATION
<TABLE>
<CAPTION>
PAGE
----
ITEM 1. FINANCIAL STATEMENTS
<S> <C>
Consolidated Condensed Balance Sheets, February 29, 2000
(Unaudited) and May 31, 1999.....................................................................................3
Unaudited Consolidated Condensed Statements of Income,
Three Months and Nine Months Ended February 29, 2000 and February 28, 1999.......................................4
Unaudited Consolidated Condensed Statements of Comprehensive Income,
Three Months and Nine Months Ended February 29, 2000 and February 28, 1999.......................................5
Unaudited Consolidated Condensed Statements of Cash Flows,
Nine Months Ended February 29, 2000 and February 28, 1999........................................................6
Notes to Consolidated Condensed Financial Statements (Unaudited) ...............................................7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS ....................................................................11
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.................................................12
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS......................................................................................13
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS..............................................................13
ITEM 3. DEFAULTS UPON SENIOR SECURITIES........................................................................13
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS ...................................................13
ITEM 5. OTHER INFORMATION......................................................................................13
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.......................................................................13
INDEX TO EXHIBITS..................................................................................................15
Exhibit 27 - Financial Data Schedule .............................................................................16
Exhibit 99 - Press Release Dated April 13, 2000 ..................................................................17
</TABLE>
<PAGE> 3
Page 3 of 18
PART 1. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
MET-COIL SYSTEMS CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
(In thousands, except shares) February 29, 2000 May 31, 1999
(Unaudited) (Note)
---------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Current assets
Cash $ 111 $ 516
Trade receivables, net 5,936 5,767
Inventories 10,003 9,545
Prepaid expenses and other 1,141 946
Deferred income taxes 1,079 2,139
---------------------------------------------------------------------------------------------------------------------
Total current assets 18,270 18,913
Property and equipment, net 4,181 4,057
Property held for sale 1,154 1,154
Investments, notes receivable and other assets 586 225
Intangibles, net 1,342 1,517
Deferred income taxes 286 256
=====================================================================================================================
TOTAL ASSETS $ 25,819 $ 26,122
=====================================================================================================================
Current liabilities
Revolving line of credit $ 936 $ 1,211
Current maturities of long-term debt 522 589
Accounts payable and accrued liabilities 4,271 4,180
Customer deposits 3,542 4,557
---------------------------------------------------------------------------------------------------------------------
Total current liabilities 9,271 10,537
Long-term debt 5,346 6,038
Other 651 691
Preferred stock, convertible and redeemable at $13 per share 0 3,469
Stockholders' equity:
Common stock, $.01 par value, authorized 10,000,000 shares; 44 37
February 29, 2000 issued 4,384,368; May 31, 1999 issued 3,681,873
Additional paid-in capital 21,597 18,225
Accumulated deficit (10,836) (12,621)
Common stock in treasury, at cost (254) (254)
---------------------------------------------------------------------------------------------------------------------
Stockholders' equity 10,551 5,387
=====================================================================================================================
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 25,819 $ 26,122
=====================================================================================================================
</TABLE>
Note: Condensed from audited financial statements
See Notes to Consolidated Condensed Financial Statements
<PAGE> 4
Page 4 of 18
MET-COIL SYSTEMS CORPORATION
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(In thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
Feb. 29, Feb 28, Feb. 29, Feb 28,
2000 1999 2000 1999
-------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net revenues $ 10,866 $ 10,293 $ 36,739 $ 32,334
Cost of goods sold 8,373 7,858 27,712 24,626
-------------------------------------------------------------------------------------------------------------------
Gross profit 2,493 2,435 9,027 7,708
Operating expenses 1,730 1,475 5,342 4,684
-------------------------------------------------------------------------------------------------------------------
Operating income 763 960 3,685 3,024
Interest expense, net 142 255 475 802
Other expense, net 108 182 223 293
-------------------------------------------------------------------------------------------------------------------
Income before income taxes 513 523 2,987 1,929
Income tax (expense) credits, net (175) 336 (1,060) 810
-------------------------------------------------------------------------------------------------------------------
Net income $ 338 $ 859 $ 1,927 $ 2,739
Preferred stock dividends and accretion 0 35 142 355
-------------------------------------------------------------------------------------------------------------------
Net income applicable to common stock $ 338 $ 824 $ 1,785 $ 2,384
===================================================================================================================
Earnings per common share:
Basic $ 0.08 $ 0.24 $ 0.46 $ 0.71
Diluted $ 0.07 $ 0.19 $ 0.43 $ 0.62
Weighted average common shares:
Basic 4,379 3,431 3,899 3,376
Diluted 4,529 4,452 4,522 4,397
</TABLE>
See Notes to Consolidated Condensed Financial Statements
<PAGE> 5
Page 5 of 18
MET-COIL SYSTEMS CORPORATION
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
Feb. 29 Feb. 28 Feb. 29 Feb. 28
2000 1999 2000 1999
--------- ---------- --------- ----------
<S> <C> <C> <C> <C>
Net income $ 338 $ 859 $ 1,927 $ 2,739
Other comprehensive income, net of tax:
Foreign currency translation adjustment 0 25 0 40
========= ========== ========= ==========
Comprehensive income $ 338 $ 884 $ 1,927 $ 2,779
========= ========== ========= ==========
</TABLE>
See Notes to Consolidated Condensed Financial Statements
<PAGE> 6
PAge 6 of 18
MET-COIL SYSTEMS CORPORATION
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(In thousands)
<TABLE>
<CAPTION>
Nine Months Ended
Feb. 29, Feb. 28,
2000 1999
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 1,927 $ 2,739
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation 696 729
Amortization of intangibles and deferred finance charges 276 312
Accretion of discount on debt 0 278
Undistributed loss of affiliate 0 340
Deferred income taxes 1,030 (1,027)
--------------------------------------------------------------------------------------------------------------------
3,929 3,371
Changes in assets and liabilities:
Trade receivables (169) (630)
Inventories (458) (1,985)
Investments, prepaid expenses and other assets (206) 32
Accounts payable, accrued liabilities and other liabilities 50 699
Customer deposits (1,015) 1,129
--------------------------------------------------------------------------------------------------------------------
Net cash flows from operating activities 2,132 2,616
--------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment (820) (1,153)
Purchase of property held for sale 0 (454)
Notes receivable and other assets (350) 0
--------------------------------------------------------------------------------------------------------------------
Net cash flows from investing activities (1,170) (1,607)
--------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Net borrowings (repayments) under revolving line of credit (275) 1,141
Repayments of long-term debt (6,976) (2,226)
Proceeds from issuance of long-term debt 6,217 0
Deferred finance charges (101) 0
Dividends on preferred stock (142) (108)
Redemption of preferred stock (169) 0
Issuance of common stock 79 434
--------------------------------------------------------------------------------------------------------------------
Net cash flows from financing activities (1,367) (759)
--------------------------------------------------------------------------------------------------------------------
CASH
Increase (decrease) (405) 250
Beginning balance 516 24
--------------------------------------------------------------------------------------------------------------------
Ending balance $ 111 $ 274
====================================================================================================================
</TABLE>
See Notes to Consolidated Condensed Financial Statements
<PAGE> 7
Page 7 of 18
MET-COIL SYSTEMS CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1. PRESENTATION OF FINANCIAL INFORMATION
The unaudited consolidated condensed financial statements have
been prepared by the Company in accordance with the instructions for
Securities and Exchange Commission's Form 10-Q and do not include all
of the information and footnotes required by generally accepted
accounting principles for audited financial statements. The unaudited
consolidated condensed financial statements include the accounts of the
Company and its subsidiaries. All material intercompany items and
transactions have been eliminated in the consolidation. In the
preparation of the unaudited amounts, all adjustments (consisting
solely of normal recurring adjustments) have been made which are, in
the opinion of management, necessary for a fair statement of the
results for the interim periods. The results for the interim periods
are not necessarily indicative of the results of operations that may be
expected for the year. It is suggested that the unaudited consolidated
condensed financial statements contained herein be read in conjunction
with the consolidated statements and notes included in the Company's
Annual Report on Form 10-K for the year ended May 31, 1999.
Risks and Uncertainties:
The preparation of the Company's financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Recent Accounting Pronouncements:
In June 1998, the Financial Accounting Standards Board ("FASB")
issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging
Activities". This statement establishes accounting and reporting
standards for derivative instruments, including certain derivative
instruments embedded in other contracts, and for hedging activities.
This statement must be adopted no later than May 31, 2002, although
earlier application is permitted. The Company is currently evaluating
the impact of adopting SFAS No. 133.
<PAGE> 8
Page 8 of 18
MET-COIL SYSTEMS CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED), CONTINUED
NOTE 2. INVENTORIES
The composition of the inventories, using the FIFO method, which
approximates replacement cost, is as follows:
<TABLE>
<CAPTION>
(in thousands) February 29, May 31,
2000 1999
--------------- --------------
<S> <C> <C>
Raw materials and parts $ 6,463 $ 6,283
Work in process 4,162 3,926
Finished goods and supplies 187 205
--------------- --------------
10,812 10,414
Reduction to LIFO basis 809 869
--------------- --------------
$ 10,003 $ 9,545
=============== ==============
</TABLE>
NOTE 3. DEBT
Revolving Line of Credit:
At February 29, 2000 the Company had a revolving credit agreement
with a bank under which it could borrow up to $5,500,000. Borrowings
are limited to a borrowing base formula (calculated based on certain
percentages of eligible trade receivables and inventories) and bear
interest at the Lender's Corporate Base Rate minus 0.25% (8.5% at
February 29, 2000). The revolving loan facility expires in July 2000.
Outstanding borrowings under the facility as of February 29, 2000 were
$936,000.
Long-Term Debt:
At February 29, 2000 the Company had $5,868,000 of term loan
facilities with a bank. The term loans mature in July 2004. The notes
are due in monthly payments of $43,536 plus interest at 8.85%. The
Company has the right to prepay the term loan facilities at any time
from operating cash flow.
For additional information concerning the Company's loan
agreements and accompanying terms and restrictions see Note 4 to
Financial Statements in the Company's Annual Report on Form 10-K for
the year ended May 31, 1999 herein incorporated by reference thereto.
<PAGE> 9
Page 9 of 18
MET-COIL SYSTEMS CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED), CONTINUED
NOTE 4. SUPPLEMENTAL CASH FLOW DATA
Supplemental cash flow is as follows:
<TABLE>
<CAPTION>
Nine Months Ended
Feb. 29, Feb. 28,
2000 1999
-------------- --------------
<S> <C> <C>
CASH PAYMENT FOR:
Interest $ 448 $ 402
Income tax $ 81 $ 217
NONCASH OPERATING, INVESTING AND FINANCING ACTIVITIES:
Preferred stock accretion included
with preferred stock dividends $ 0 $ 244
Conversion of redeemable preferred stock
into common stock $ 3,300 $ 942
</TABLE>
During the nine months ended February 29, 2000, 253,840 shares of the
Company's preferred stock were converted by shareholders to 761,520 shares of
common stock. This resulted in a reclassification of $3,300,000 from preferred
stock to stockholder's equity.
<PAGE> 10
Page 10 of 18
MET-COIL SYSTEMS CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED), CONTINUED
NOTE 5. EARNINGS PER SHARE
Basic and diluted earnings per share are calculated as follows:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
(In thousands, except per share data) Feb. 29, Feb. 28, Feb. 29, Feb. 28,
2000 1999 2000 1999
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Basic earnings per share:
Net income available to common
Stockholders - basic $ 338 $ 824 $1,785 $2,384
====== ====== ====== ======
Weighted average shares
Outstanding - basic 4,379 3,431 3,899 3,376
====== ====== ====== ======
Basic earnings per share $ 0.08 $ 0.24 $ 0.46 $ 0.71
====== ====== ====== ======
Diluted earnings per share:
Net income available to common
Stockholders - basic $ 338 $ 824 $1,785 $2,384
Effect of preferred stock dividends
And accretion 0 35 142 355
------ ------ ------ ------
Net income available to common
Stockolders - diluted $ 338 $ 859 $1,927 $2,739
====== ====== ====== ======
Weighted avg. shares outstanding-basic 4,379 3,431 3,899 3,376
Effect of dilutive securities:
Stock options granted 150 152 150 152
Convertible preferred stock 0 869 473 869
------ ------ ------ ------
Weighted average shares
Outstanding - diluted 4,529 4,452 4,522 4,397
====== ====== ====== ======
Diluted earnings per share $ 0.07 $ 0.19 $ 0.43 $ 0.62
====== ====== ====== ======
Number of antidilutive shares
excluded from calculation above:
Options 0 2 0 2
====== ====== ====== ======
Redeemable preferred stock 0 0 0 0
====== ====== ====== ======
</TABLE>
<PAGE> 11
Page 11 of 18
MET-COIL SYSTEMS CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Certain of the statements contained in this report may be
forward-looking statements. Forward-looking statements include estimates and
statements regarding plans, objectives and expectations of the Company and its
management. Examples of certain forward-looking statements are the Company's
estimates of the cost, timing and effect of its Year 2000 compliance efforts and
the Company's expectations regarding its ability to meet future funding
obligations. Although the Company believes that the expectations reflected in
all such forward-looking statements are based upon reasonable assumptions, it
can give no assurance that its expectations will be achieved. Such
forward-looking statements involve risks and uncertainties which may cause the
actual results, performance or achievements of the Company to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such risks and uncertainties
include, among other things, the effect of economic conditions, the impact of
competition, availability of capital, supply constraints or difficulties, the
effect of the Company's accounting policies and the effect of regulatory and
legal developments.
FISCAL 2000 - THIRD QUARTER AND NINE MONTH RESULTS OF OPERATIONS
Revenues for the quarter ended February 29, 2000 were $10.9 million
compared to $10.3 million for the prior year period. For the first nine months
of fiscal 2000 revenues were $36.7 million, an increase of 14% compared to
revenues of $32.3 million for the first nine months of last year.
Income before taxes for the third quarter was $513,000, compared to
$523,000 for the third quarter last year. Net income for the three months ended
February 29, 2000 was $338,000 (after normal income tax expense this quarter of
$175,000) or $.07 diluted earnings per share, compared to net income of $859,000
(after including income tax credit for the same period last year of $336,000) or
$.19 diluted earnings per share for third quarter of last year.
Income before taxes for the nine months ended February 29, 2000 was
$3.0 million, up from $1.9 million last year. Net income for the nine months
ended February 29, 2000 was $1.9 million (after normal income tax expense for
the first nine months of $1.1 million) or $.43 diluted earnings per share,
compared to net income of $2.7 million (after including income tax credit for
the same period last year of $810,000) or $.62 diluted earnings per share one
year ago.
Order backlog remained consistent at $17.7 million as of February 29,
2000 compared to $18.0 million at February 28, 1999.
<PAGE> 12
Page 12 of 18
LIQUIDITY AND CAPITAL RESOURCES
Financial Review, Cash Flows and Commitments:
At February 29, 2000, current assets exceeded current liabilities by
$9.0 million and the Company had approximately $4.6 million available to borrow
under its revolving credit agreement.
Cash flow from operations in the first nine months of fiscal 2000 was
$2.1 million, compared to $2.6 million in the first nine months of fiscal 1999.
The Company continues to omit quarterly common stock dividends due to
loan covenants, which prohibit the payment of common stock dividends. It is
uncertain when, and if, the Company will pay common stock dividends in the
future.
The Company was in compliance with all debt covenants contained in its
loan agreements as of February 29, 2000. Management of the Company believes that
amounts available from operating cash flows, funds available under its revolving
credit agreement and the Company's borrowing capacity will be sufficient to meet
its expected cash needs and capital expenditures for the fiscal year.
Year 2000
The Year 2000 issue is the result of computer programs that were
written using two digits (rather than four) to define the application year.
Date-sensitive software could fail to process critical financial and operational
information correctly.
Like other business organizations, the Company took appropriate
measures in advance of the calendar change on January 1, 2000 to ensure it's
applications, software programs and operating systems would accommodate this
date value. To date the Company has experienced no know difficulty related to
the Year 2000 issue.
In the event that the Company and material third parties such as
suppliers and/or customers experience Year 2000 issues, a likely worst-case
scenario could bring about possible system failure or other interruption of
operations such as an inability to process transactions or engage in normal
business activities for a short time.
The Company has established contingency plans to address the
consequences of possible failure and will conduct an orderly shutdown or scale
back of operations if a loss of certain services is experienced. This is
essentially the same process currently used for non-Year 2000 system failures
that could occur.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company is subject to market risk exposure related to changes in
interest rates on its revolving line of credit facility. Interest on borrowings
under this agreement accrues at a variable rate at the Lender's Corporate Base
Rate minus 0.25% (8.5% at February 29, 2000). Due to the limited borrowings
under this agreement, interest rate risk exposure, assuming a ten percent
increase from the average variable rate, would be less than $25,000 per year.
<PAGE> 13
Page 13 of 18
MET-COIL SYSTEMS CORPORATION
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS - See Legal Proceedings as included in the Company's
Annual Report on Form 10-K for the year ended May 31, 1999.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS - None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES - None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - None
ITEM 5. OTHER INFORMATION - None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS -- See Index to Exhibits included elsewhere herein.
(b) FORM 8-K -- A report on Form 8-K was filed March 14, 2000 which
announced the execution of a definitive merger
agreement under which Met-Coil will be merged into a
wholly-owned subsidiary of Mestek's Formtek, Inc.
subsidiary.
<PAGE> 14
Page 14 of 18
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 thereunto duly authorized.
Date: April 14, 2000 Met-Coil Systems Corporation
- --------------------
Randall J. Stodola/s/
------------------------------
Randall J. Stodola
Vice President, Controller and
Chief Accounting Officer
<PAGE> 15
Page 15 of 18
MET-COIL SYSTEMS CORPORATION
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT NO. PAGE
- ----------- ----
<S> <C> <C>
3.1 Restated Certificate of Incorporation of the Registrant, as
amended -- incorporated by reference to Exhibit 3.2 of the
Registrant's Quarterly Report on Form 10-Q for the quarter
ended November 30, 1987.........................................................................................
3.2 Amended and Restated Bylaws of the Registrant --
incorporated by reference to Exhibit 3.4 of the Registrant's
Quarterly Report on Form 10-Q for the quarter ended
November 30, 1987...............................................................................................
10 Material contracts -- incorporated by reference to
Form 10-K filed August 30, 1999.................................................................................
21 Subsidiaries of the Registrant -- incorporated by reference to
Form 10-K filed August 30, 1999.................................................................................
27 Financial Data Schedule.......................................................................................17
99 Press Release dated April 13, 2000............................................................................18
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM THE REGISTRANT
COMPANY CONSOLIDATED CONDENSED BALANCE SHEET (UNAUDITED) FOR FEBRUARY 29, 2000
AND CONSOLIDATED CONDENSED STATEMENT OF INCOME (UNAUDITED) FOR THE NINE MONTHS
ENDED FEBRUARY 29, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAY-31-2000
<PERIOD-START> JUN-01-1999
<PERIOD-END> FEB-29-2000
<CASH> 111
<SECURITIES> 0
<RECEIVABLES> 6,451
<ALLOWANCES> 101
<INVENTORY> 10,003
<CURRENT-ASSETS> 18,684
<PP&E> 19,350
<DEPRECIATION> 14,015
<TOTAL-ASSETS> 26,233
<CURRENT-LIABILITIES> 9,271
<BONDS> 0
0
0
<COMMON> 21,597
<OTHER-SE> (11,090)
<TOTAL-LIABILITY-AND-EQUITY> 26,233
<SALES> 36,739
<TOTAL-REVENUES> 36,739
<CGS> 27,712
<TOTAL-COSTS> 33,054
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 475
<INCOME-PRETAX> 2,987
<INCOME-TAX> 1,060
<INCOME-CONTINUING> 1,927
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,927
<EPS-BASIC> .46
<EPS-DILUTED> .43
</TABLE>
<PAGE> 1
Page 17 of 18
Immediately Tammy Hubacek
MET-COIL SYSTEMS CORPORATION
ANNOUNCES THIRD QUARTER NET EARNINGS
CEDAR RAPIDS, IA - APRIL 13, 2000 - Met-Coil Systems Corporation
(METS), a supplier of advanced sheet metal forming equipment, fabricating
equipment and glass processing technologies for the global market, announces net
income for the third quarter and nine months ended February 29, 2000.
"Revenues and pre-tax income at both of our operating units are
ahead of last year at this time," reported James D. Heitt, Met-Coil's
President and Chief Operating Officer.
THIRD QUARTER RESULTS AND NINE-MONTH PERFORMANCE
Revenues for the quarter ended February 29, 2000 were $10.9 million
compared to $10.3 million for the prior year period. For the first nine months
of fiscal 2000 revenues were $36.7 million, an increase of 14% compared to
revenues of $32.3 million for the first nine months of last year.
Income before taxes for the third quarter was $513,000, compared to
$523,000 for the third quarter last year. Net income for the three months ended
February 29, 2000 was $338,000 (after normal income tax expense this quarter of
$175,000) or $.07 diluted earnings per share, compared to net income of $859,000
(after including income tax credit for the same period last year of $336,000) or
$.19 diluted earnings per share for third quarter of last year.
Income before taxes for the nine months ended February 29, 2000 was
$3.0 million, up from $1.9 million last year. Net income for the nine months
ended February 29, 2000 was $1.9 million (after normal income tax expense for
the first nine months of $1.1 million) or $.43 diluted earnings per share,
compared to net income of $2.7 million (after including income tax credit for
the same period last year of $810,000) or $.62 diluted earnings per share one
year ago.
Order backlog remained consistent at $17.7 million as of February 29,
2000 compared to $18.0 million at February 28, 1999.
Met-Coil Systems Corporation is headquartered in Cedar Rapids, Iowa.
Its operating units include Iowa Precision Industries, Inc. also in Cedar Rapids
and The Lockformer Company in Lisle, Illinois.
# # #
Table to Follow
<PAGE> 2
Page 18 of 18
MET-COIL SYSTEMS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
Feb. 29, Feb. 28, Feb. 29, Feb. 28,
2000 1999 2000 1999
--------- --------- ---------- ----------
<S> <C> <C> <C> <C>
(In thousands, except per share amounts)
Net revenues $ 10,866 $ 10,293 $ 36,739 $ 32,334
Operating income 763 960 3,685 3,024
Interest expense, net (142) (255) (475) (802)
Other income (expense) net (108) (182) (223) (293)
--------- --------- ---------- ----------
Income before income taxes 513 523 2,987 1,929
Income tax (expense) credit (175) 336 (1,060) 810
--------- --------- ---------- ----------
Net income 338 859 1,927 2,739
Preferred stock dividends and accretion 0 (35) (142) (355)
--------- --------- ---------- ----------
Net income applicable to common stock $ 338 $ 824 $ 1,785 $ 2,384
========= ========= ========== ==========
Diluted earnings per share $ 0.07 $ 0.19 $ 0.43 $ 0.62
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</TABLE>
