<PAGE>
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 June 30, 1999
Commission file Number 1-5356
PENN ENGINERRING & MANUFACTURING CORP.
(Exact name of registrant as specified in its charter.)
Delaware 23-0951065
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
P.O. Box 1000, Danboro, Pennsylvania 18916
(Address of principal executive offices (Zip Code)
Registrant's telephone number, including area code:
(215) 766-8853
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 [ ]
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practical
date: 1,675,082 shares of Class A common stock, $.01 par value, and
6,972,284 shares of common stock, $.01 par value, outstanding on
August 12, 1999.
<PAGE> 2
<TABLE>
PART I. - FINANCIAL INFORMATION
Item 1. Financial Statements
PENN ENGINEERING & MANUFACTURING CORP.
CONDENSED CONSOLIDATED BALANCE SSHEETS
<CAPTION>
(Dollars in thousands)
ASSETS
(Unaudited)
June 30, 1999 December 31, 1998
-------------- -----------------
CURRENT ASSETS
<S> <C> <C>
Cash and cash equivalents $10,021 $13,103
Short-term investments 16,511 10,584
Accounts receivable-trade 33,191 29,513
Allowance for doubtful accounts (610) (550)
Inventories 33,452 31,840
Prepaid expenses 2,247 2,474
------ ------
Total current assets 94,812 86,964
------- -------
PROPERTY
Property, plant & equipment 133,942 126,773
Less accumulated depreciation 56,802 52,769
------- -------
Property - net 77,140 74,004
------- -------
OTHER ASSETS 3,732 3,200
------- -------
TOTAL $175,684 $164,168
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable - trade $6,442 $5,460
Dividends payable 1,038 0
Accrued expenses:
Pension & profit sharing 3,776 1,155
Income taxes 1,698 1,026
Payroll & commissions 4,544 3,237
Other 1,596 2,429
------ ------
Total current liabilities 19,094 13,307
------ ------
ACCRUED PENSION COST 4,088 4,088
------ ------
DEFERRED INCOME TAXES 4,388 4,721
------ ------
STOCKHOLDERS' EQUITY
Class A common stock 18 18
Common stock 72 72
Additional paid-in capital 36,756 36,530
Retained earnings 115,631 109,384
Accumulated other comprehensive
income (1,377) (966)
Treasury stock (2,986) (2,986)
------- -------
Total stockholders' equity 148,114 142,052
------- -------
TOTAL $175,684 $164,168
======= =======
See Notes to Condensed Consolidated Financial Statements
</TABLE>
<PAGE> 3
<TABLE>
PENN ENGINEERING & MANUFACTURING CORP.
STATEMENTS OF CONDENSED CONSOLIDATED INCOME AND RETAINED EARNINGS
(Unaudited)
<CAPTION>
(Dollars in thousands except per share amounts)
THREE MONTHS ENDED SIX MONTHS ENDED
------------------------------ ------------------------------
June 30, 1999 June 30, 1998 June 30, 1999 June 30, 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
NET SALES $47,037 $44,995 $93,037 $91,720
COST OF PRODUCTS SOLD 32,068 31,056 63,580 63,188
------ ------ ------ ------
GROSS PROFIT 14,969 13,939 29,457 28,532
------ ------ ------ ------
OTHER EXPENSES:
Selling expenses 4,848 4,836 9,781 9,639
General & administrative expenses 3,905 3,237 7,675 6,626
------ ------ ------ ------
8,753 8,073 17,456 16,265
------ ------ ------ ------
OPERATING PROFIT 6,216 5,866 12,001 12,267
OTHER INCOME - NET 212 231 522 511
------ ------ ------ ------
INCOME BEFORE INCOME TAXES 6,428 6,097 12,523 12,778
PROVISION FOR INCOME TAXES 2,163 2,215 4,202 4,630
------ ------ ------ ------
NET INCOME $4,265 $3,882 $8,321 $8,148
===== ===== ===== =====
PER SHARE DATA:
Basic earnings $0.49 $0.45 $0.96 $0.94
==== ==== ==== ====
Diluted earnings $0.49 $0.45 $0.96 $0.94
==== ==== ==== ====
Cash dividends declared $0.12 $0.11 $0.24 $0.22
==== ==== ==== ====
See Notes to Condensed Consolidated Financial Statements
</TABLE>
<PAGE> 4
<TABLE>
PENN ENGINEERING & MANUFACTURING CORP.
STATEMENTS OF CONDENSED CONSOLIDATED CASH FLOWS
(Unaudited)
<CAPTION>
(Dollars in thousands)
SIX MONTHS ENDED
--------------------------------
June 30, 1999 June 30, 1998
------------- -------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $8,321 $8,148
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation 4,165 3,934
Gain on disposal of property (174) (27)
Changes in assets and liabilities:
Increase in receivables (3,451) (1,968)
Increase in inventories (1,263) (3,082)
Decrease in prepaid expenses 190 147
Increase in other assets (100) (119)
Increase in accounts payable 877 682
Increase in accrued expenses 3,754 2,500
Increase in accrued pension cost 0 879
Decrease in deferred income taxes (333) (230)
------ ------
Net cash provided by operating
activities 11,986 10,864
------ ------
CASH FLOWS FROM INVESTING ACTIVITIES:
Property additions (6,819) (3,856)
Acquisition of MicroAssembly Systems, Inc.(1,694) 0
Additions to held-to-maturity
investments (14,475) (12,545)
Proceeds from disposal of held-to-
maturity investments 8,522 8,005
Proceeds from disposal of property 215 155
------ ------
Net cash used in investing activities (14,251) (8,241)
------ -----
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends paid (1,036) (949)
Issuance of common stock 226 195
------ ------
Net cash used in financing activities (810) (754)
------ ------
Effect of exchange rate changes on cash (7) 231
------ ------
Net (decrease) increase in cash and
cash equivalents (3,082) 2,100
Cash and cash equivalents at
beginning of year 13,103 6,826
------ ------
Cash and cash equivalents at end of
period $10,021 $8,926
====== =====
See Notes to Condensed Consolidated Financial Statements
</TABLE>
<PAGE> 5
PENN ENGINEERING & MANUFACTURING CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1999
Note 1. Condensed Consolidated Financial Statements (Unaudited)
- ---------------------------------------------------------------
The accompanying interim financial statements should be read in conjunction
with the annual financial statements and notes thereto included in the
Company's Annual Report for the year ended December 31, 1998. The information
contained in this report is unaudited and subject to year-end audit and
adjustment. In the opinion of management, all adjustments (which include only
normal recurring adjustments) have been made which are necessary for a fair
presentation of the Company's consolidated financial position at June 30,
1999 and 1998 and the consolidated statements of income and cash flows for the
six-month periods then ended. The results of operations for the six months
ended June 30, 1999 are not necessarily indicative of the results of
operations to be expected for the year ending December 31, 1999.
Note 2. Inventories
- -------------------
Substantially all of the Company's domestic fastener inventories are priced
on the lower of last-in, first-out (LIFO) cost or market method. The remainder
of the inventories are priced on the first-in, first-out (FIFO) method, at the
lower of cost or market.
Inventories are as follows: (Dollars in thousands)
(Unaudited)
June 30, 1999 December 31, 1998
------------- -----------------
Raw material $4,893 $4,572
Tooling 3,501 3,435
Work-in-process 11,311 10,533
Finished goods 13,747 13,300
------ ------
TOTAL $33,452 $31,840
====== ======
If the FIFO method of inventory valuation had been used by the Company for
all inventories, inventories would have been $9,246,000 and $9,046,000 higher
than reported at June 30, 1999 and December 31, 1998, respectively, and
net income would have been $133,000 and $128,000 higher than reported for the
six months ended June 30, 1999 and 1998, respectively. Included in other
assets is long-term tooling inventory totaling $3,300,000 and $3,200,000 at
June 30, 1999 and December 31, 1998, respectively.
Note 3. Comprehensive Income
- ----------------------------
Total comprehensive income amounted to $7,909,000 and $8,655,000 for the
six months ended June 30, 1999 and 1998, respectively.
Note 4. Use of Estimates
- ------------------------
The preparation of 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.
Note 5. Acquisition
- -------------------
The Company acquired the assets of MicroAssembly Systems, Inc. on May 28,
1999. The acquisition will be accounted for using the purchase method. The
purchase price of approximately $1.8 million consisted of cash, the assumption
of certain liabilities, and acquisition related expenses. The results of the
operations of MicroAssembly Systems, Inc. have been included in the ac-
companying consolidated statement of income since the acquisition date. The
purchase price has been preliminarily allocated to; accounts receivable -
$287,000, inventory - $481,000, property - $626,000 and goodwill and other
intangible assets - $432,000. Goodwill and other intangible assets have been
included in other assets in the accompanying balance sheet and will be
amortized using the straight-line method over a period of 10 years.
<PAGE> 6
PENN ENGINEERING & MANUFACTURING CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
June 30, 1999
Note 6. Segment Information
- ---------------------------
(Dollars in thousands)
THREE MONTHS ENDED THREE MONTHS ENDED
June 30, 1999 June 30, 1998
------------- -------------
Fasteners Motors Fasteners Motors
--------- ------ --------- ------
Revenues from external customers $38,485 $8,552 $36,633 $8,362
Operating profit 5,416 800 5,229 637
SIX MONTHS ENDED SIX MONTHS ENDED
June 30, 1999 June 30, 1998
------------- -------------
Fasteners Motors Fasteners Motors
--------- ------ --------- ------
Revenues from external customers $76,540 $16,497 $74,460 $17,260
Operating profit 10,607 1,394 11,457 810
Segment assets 160,589 15,096 147,267 15,472
Note 7. Earnings Per Share Data
- -------------------------------
The following table sets forth the computation of basic and diluted earnings
per share for the periods indicated.
THREE MONTHS ENDED SIX MONTHS ENDED
June 30 June 30
------- -------
1999 1998 1999 1998
---- ---- ---- ----
(In thousands, except per share data)
Basic:
Net income $4,265 $3,882 $8,321 $8,148
Average shares outstanding 8,647 8,643 8,641 8,638
----- ----- ----- -----
Basic EPS $0.49 $0.45 $0.96 $0.94
===== ===== ===== =====
Diluted:
Net income $4,265 $3,882 $8,321 $8,148
===== ===== ===== =====
Average shares outstanding 8,647 8,643 8,641 8,638
Net effect of dilutive stock
options - based on treasury
stock method 13 37 11 34
----- ----- ----- -----
Totals 8,660 8,680 8,652 8,672
===== ===== ===== =====
Diluted EPS $0.49 $0.45 $0.96 $0.94
===== ===== ===== =====
<PAGE> 7
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
PENN ENGINEERING & MANUFACTURING CORP.
June 30, 1999
MANAGEMENT'S DISCUSSION AND
ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
Quarter Ended June 30, 1999 vs. Quarter Ended June 30, 1998
- -----------------------------------------------------------
Consolidated net sales for the quarter ended June 30, 1999 were $47.0
million, versus $45.0 million for the quarter ended June 30, 1998, a 4.4%
increase. Net sales to customers outside the United States for the quarter
ended June 30, 1999 were $14.8 million, versus $12.8 million for the
quarter ended June 30, 1998, a 15.6% increase. Net sales for the fastener
operation for the quarter ended June 30, 1999 were $38.5 million, versus
$36.6 million for the quarter ended June 30, 1998, a 5.2% increase. Motor
net sales were $8.5 million for the quarter ended June 30, 1999, versus
$8.4 million recorded for the quarter ended June 30, 1998, a 1.2% increase.
The number of fastener units sold to independent customers increased
approximately 8.6% in the second quarter of 1999 compared to the second
quarter of 1998. The number of fastener units sold within North America
increased approximately 4.6% in the second quarter of 1999 compared to the
second quarter of 1998, and represented approximately 67.5% of total fasteners
sold in the second quarter of 1999. The number of fastener units sold
into Europe increased approximately 0.4% in the second quarter of 1999
compared to the second quarter of 1998 and represented approximately 23.4% of
total fasteners sold in the second quarter of 1999. The number of fastener
units sold into the Asia-Pacific region increased approximately 115.7% in the
second quarter of 1999 compared to the second quarter of 1998, mainly as a
result of the continued shifting of assembly operations by major computer
manufacturers to this region. The average selling price for fasteners shipped
in the second quarter of 1999 was $62.94 per thousand fasteners sold compared
to $62.86 per thousand fasteners sold in the second quarter of 1998. The
number of motors sold increased 7.4% in the second quarter of 1999 compared to
the second quarter of 1998 while the average selling price decreased approx-
imately 4.8% during the same period.
Consolidated gross profit for the second quarter of 1999 was $15.0 million,
versus $13.9 million for the second quarter of 1998, a 7.9% increase. Fastener
gross profit increased 6.2% in the second quarter of 1999 compared to the
second quarter of 1998 while motor gross profit increased 14.5% mainly due to
the increased sales and a reduction of fixed expenses.
Consolidated selling, general, and administrative expenses ("SG&A") for the
second quarter of 1999 were $8.8 million, versus $8.1 million for the second
quarter of 1998, an 8.6% increase. This increase was mainly caused by
increased technology related expenses, including Year 2000 related expenses,
and due diligence and start-up costs related to acquisition efforts.
Consolidated net income for the second quarter of 1999 was $4.3 million,
versus $3.9 million for the second quarter of 1998. The Company benefited
from a lower effective tax rate in the second quarter of 1999 compared to the
second quarter of 1998 due mainly to the increased benefits of the Foreign
Sales Corporation.
<PAGE> 8
PENN ENGINEERING & MANUFACTURING CORP.
June 30, 1999
MANAGEMENT'S DISCUSSION AND
ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
Six Months Ended June 30, 1999 vs. Six Months Ended June 30, 1998
- -----------------------------------------------------------------
Consolidated net sales for the six months ended June 30, 1999 were $93.0
million, versus $91.7 million for the six months ended June 30, 1998, a 1.4%
increase. Net sales to customers outside the United States for the six months
ended June 30, 1999 were $30.8 million, versus $25.9 million for the six
months ended June 30, 1998, an 18.9% increase. Net sales for the fastener
operation for the six months ended June 30, 1999 were $76.5 million, versus
$74.5 million for the six months ended June 30, 1998, a 2.7% increase. Motor
sales were $16.5 million for the six months ended June 30, 1999, versus $17.2
million for the six months ended June 30, 1998, a 4.1% decrease.
The number of fastener units sold to independent customers increased
approximately 5.4% in the first six months of 1999 compared to the first
six months of 1998. The number of fastener units sold within North America
decreased approximately 2.5% in the first six months of 1999 compared to the
first six months of 1998, and represented approximately 65.1% of total
fasteners shipped in the first six months of 1999. The number of fastener
units sold into Europe increased approximately 5.2% in the first six months of
1999 compared to the first six months of 1998 and represented approximately
25.3% of total fasteners sold in the first six months of 1999. This increase
is mainly due to the continued strong European economy especially in the
automotive sector. The number of fastener units sold into the Asia-Pacific
region increased approximately 135.2% from the first six months of 1998 to the
first six months of 1999 as computer manufacturers shifted assembly to this
area to take advantage of lower assembly costs. The average selling price of
fasteners shipped in the first six months of 1999 decreased approximately 2.2%
from $63.92 per thousand fasteners sold in the first six months of 1998 to
$62.53 per thousand fasteners sold in the first six months of 1999. The number
of motors sold decreased less than 1% in the first six months of 1999
compared to the first six months of 1998, however the average selling price
decreased 4.2% from $42.27 per motor in the first six months of 1998 to $40.50
per motor in the first six months of 1999. Two major customers have cancelled
and/or rescheduled orders for later this year.
Consolidated gross profit for the first six months of 1999 was $29.5
million, versus $28.5 million for the first six months of 1998, a 3.5%
increase. Fastener gross profit increased 3.3% in the first six months of
1999 compared to the first six months of 1998 while motor gross profit
increased 3.2% during the same period.
Consolidated SG&A expenses for the first six months of 1999 were $17.5
million, versus $16.3 million for the first six months of 1998, an 7.4%
increase. This increase was expected due to continued Year 2000 compliance and
testing costs as well as costs related to acquisition activity.
Consolidated net income for the first six months of 1999 was $8.3 million,
versus $8.1 million for the first six months of 1998. The Company benefited
from a lower effective tax rate as a result of increased foreign sales
activity.
<PAGE> 9
PENN ENGINEERING & MANUFACTURING CORP.
June 30, 1999
MANAGEMENT'S DISCUSSION AND
ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
Liquidity and Capital Resources
- -------------------------------
Net cash provided by operations totaled $12.0 million for the six months
ended June 30, 1999. Capital expenditures totalled $6.8 million during the
first half of 1999 which included approximately $3.5 million for an additional
50,000 square feet of manufacturing space near the Company's Danboro, PA.
headquarters. The Company also acquired the assets of MicroAssembly Systems,
Inc. for approximately $1.7 million. Short-term investments increased 55.7%
from $10.6 million at December 31, 1998 to $16.5 million at June 30, 1999.
Accordingly, the Company anticipates that its existing capital resources and
cash flow generated from future operations will enable it to maintain its
current level of operations and its planned growth for the foreseeable future.
Year 2000 Issues
- ----------------
As is more fully described in the Company's annual report on Form 10-K for
the fiscal year ended December 31, 1998, the Company is modifying or replacing
significant portions of its software as well as certain hardware to enable
continued operations beyond December 31, 1999. As of June 30, 1999 the Company
estimates its progress toward completion of its Year 2000 compliance plan as
indicated in the following table:
<TABLE>
<CAPTION>
Fastener Operation
------------------
Danboro Winston Suffolk Motor IT PEM PEM
Operation Operation Operation Operation Systems Facilities Singapore Doncaster
--------- --------- --------- --------- ------- ---------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Review & Assessment 100% 100% 100% 100% 100% 100% 100% 100%
Document Unknown
Status Items 100% 100% 100% 100% 100% 100% 100% 100%
Remediation - Known
Non-Compliance
Testing 98% 98% 98% 98% 100% 100% 90% 100%
Testing 98% 98% 98% 98% 100% 100% 71% 100%
Expected Completion
Date 8/31/99 8/31/99 8/31/99 8/31/99 Complete Complete 8/31/99 Complete
</TABLE>
Testing for Winston-Salem, Suffolk, Singapore, and Doncaster are conducted
at Danboro.
We are also in the process of surveying our business partners concerning
their Y2K readiness. As of this date we have completed 80% of this process. It
is our goal to complete this phase by September 30, 1999. Y2K is not
applicable to our self-clinching fastener products, our PEMSERTER insertion
machines, or our Pittman division motors.
Total Y2K expenditures are expected to approximate $1.2 million, of which
approximately 85% has been spent to date. The balance is expected to be spent
during the remainder of 1999. These costs represent estimates based on
internal and external efforts to identify Y2K issues critical to the produc-
tion and delivery of the Company's products. Actual results could differ from
those anticipated.
The Company's plans to complete Y2K modifications are based on management's
estimates, which are based on numerous assumptions about future events,
including the continued availability of certain resources and other factors.
Estimates on the status of completion and expected completion dates are based
on the level of effort expended to date to total expected internal staff
effort. However, there can be no guarantee that these estimates will be
achieved and actual results could differ materially from those plans. Specific
factors that might cause such material differences include, but are not
limited to, the availability and cost of personnel trained in this area, the
ability to locate and correct all relevant computer codes, and similiar
uncertainties.
The information above contains forward-looking statements, including, with-
out limitation, statements relating to the Company's plans, strategies, ob-
jectives, expectations, intentions, and adequate resources that are made
pursuant to the "safe harbor" provisions of the "Private Securities Litigation
Reform Act of 1995". Readers are cautioned that forward-looking statements
about Y2K should be read in conjunction with the Company's disclosure under
the heading "Forward Looking Statements".
<PAGE> 10
PENN ENGINEERING & MANUFACTURING CORP.
June 30, 1999
MANAGEMENT'S DISCUSSION AND
ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
Forward-Looking Statements
- --------------------------
Forward-looking statements are made throughout this Mnagement's Discussion
and Analysis. The Company's results may differ from those in the forward-
looking statements. Forward-looking statements are based on management's
current views and assumptions, and involve risks and uncertainties that
significantly affect expected results. For example, operating results may be
affected by external factors such as: changes in laws and regulations, changes
in accounting standards, fluctuations in the cost and availability of the
supply chain resources, and foreign economic conditions, including currency
rate fluctuations.
Item 3. Quantitative and Qualitative Disclosure About Market Risk
- -----------------------------------------------------------------
There have been no material changes to Part 2, Item 7A of the Company's Form
10-K Annual Report for the year ended December 31, 1998.
<PAGE> 11
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
- -------------------------
Reference is made to Part 1, Item 3 of the Company's Form 10-K Annual Report
for the year ended December 31, 1998.
Item 2. Changes in Securities
- -----------------------------
Not Applicable.
Item 3. Default upon Senior Securities
- --------------------------------------
Not Applicable.
Item 4. Submission of Matters to a Vote of Security Holders
- -----------------------------------------------------------
The Company held its 1999 Annual Meeting of Stockholders (the "Annual
Meeting") on May 6, 1999. The matters voted upon at the Annual Meeting and the
respective voting results were as follows:
1. The election of three Class B Directors of the Company to hold office
until the Annual Meeting of Stockholders to be held in 2002 and until their
successors are duly elected.
Name of Nominee For Withheld
- --------------- --- --------
Kenneth A. Swanstrom 1,529,840 1,000
Lewis W. Hull 1,528,615 2,225
Mark W. Simon 1,529,840 1,000
The Directors whose term of office continued after the meeting were:
Class A Directors:
- ------------------
Maurice D. Oaks
Charles R. Smith
Martin Bidart
Class C Directors:
- ------------------
Willard S. Boothby
Thomas M. Hyndman
Daryl L. Swanstrom
2. The election of Ernst & Young as auditors for the Company for its 1999
fiscal year.
For Against Abstain
--- ------- -------
1,528,920 654 1,266
3. The approval of the Company's 1999 Employee Stock Option Plan.
For Against Abstain Broker Non-Votes
--- ------- ------- ----------------
1,175,704 30,610 194,331 130,195
4. The approval of the Company's 1998 Stock Option Plan for Non-Employee
Directors.
For Against Abstain Broker Non-Votes
--- ------- ------- ----------------
1,178,005 26,688 195,952 130,195
<PAGE> 12
Item 5. Other Information
- -------------------------
a). Acquisitions
On May 28, 1999 the Company acquired the assets of MicroAssembly
Systems, Inc. See Note 5 of the Notes to the Condensed Consolidated Financial
Statements on page 5. On July 23, 1999 the Company purchased the slotted
brushless motor technology, inventory, and fixed assets of Carson
Technologies, Inc. of Carson City, Nevada, for $350,000.
Item 6. Exhibits and Reports on Form 8-K
- ----------------------------------------
a). Exhibits
Exhibit No. Description
----------- -----------
3.1 Restated Certificate of Incorporation (Incorporated by
reference to Exhibit 3.1 of the Company's Form 10-Q
Quarterly Report for the period ended June 30, 1996.)
3.2 By-laws, as amended (Incorporated by reference to Exhibit
3(ii) of the Company's Form 10-K Annual Report for the
fiscal year ended December 31, 1994.)
27 Financial Statemet Data Schedule
b). Reports on Form 8-K
None.
<PAGE> 13
SIGNATURE
Pursuant to the requirement of the Securities Exchange Act of
1934, the Company has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
PENN ENGINEERING & MANUFACTURING CORP.
Dated: August 12, 1999 By: /s/ Kenneth A. Swanstrom
-----------------------------
Kenneth A. Swanstrom
Chairman/CEO
Dated: August 12, 1999 By: /s/ Mark W. Simon
-----------------------------
Mark W. Simon
Vice-President - Finance
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> Dec-31-1999
<PERIOD-END> Jun-30-1999
<CASH> 10,021
<SECURITIES> 16,511
<RECEIVABLES> 33,191
<ALLOWANCES> 610
<INVENTORY> 33,452
<CURRENT-ASSETS> 94,812
<PP&E> 133,942
<DEPRECIATION> 56,802
<TOTAL-ASSETS> 175,684
<CURRENT-LIABILITIES> 19,094
<BONDS> 0
<COMMON> 90
0
0
<OTHER-SE> 148,024
<TOTAL-LIABILITY-AND-EQUITY> 175,684
<SALES> 93,037
<TOTAL-REVENUES> 93,559
<CGS> 63,580
<TOTAL-COSTS> 81,036
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 12,523
<INCOME-TAX> 4,202
<INCOME-CONTINUING> 8,321
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,321
<EPS-BASIC> 0.96
<EPS-DILUTED> 0.96
</TABLE>