<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________
FROM 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 March 31, 1995
--------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period _____________ to _______________
Commission file number: 0-14275
-------
Edac Technologies Corporation
-----------------------------
(Exact name of registrant as specified in its charter)
Wisconsin 39-1515599
--------- ----------
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) Identification No.)
1790 New Britain Avenue, Farmington, CT 06032
-----------------------------------------------
(Address of principal executive offices)
(203) 677-2603
--------------
(Registrant's telephone number, including area code)
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:
On May 11, 1995 there were outstanding 3,603,873 shares of the
Registrant's Common Stock, $0.0025 par value per share.
<PAGE>
EDAC TECHNOLOGIES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 31
--------------------------
1995 1994
------------ ------------
<S> <C> <C>
Sales $7,516,249 $7,241,826
Cost of sales 6,587,913 6,197,654
---------- ----------
928,336 1,044,172
Selling, general and
administrative expenses 706,626 733,111
---------- ----------
INCOME FROM OPERATIONS 221,710 311,061
Non-operating income
(expense):
Interest expense (121,244) (105,950)
Other 8,824 (2,503)
---------- ----------
(112,420) (108,453)
INCOME BEFORE INCOME TAXES 109,290 202,608
Income tax expense 10,504 68,962
---------- ----------
NET INCOME $ 98,786 $ 133,646
========== ==========
Weighted average number of
shares of common shares and
equivalent shares outstanding 3,720,247 3,684,524
Net income per share $ 0.03 $ 0.04
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
PART 1 FINANCIAL INFORMATION
ITEM 1 FINANCIAL STATEMENTS
EDAC TECHNOLOGIES CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31 December 31
1995 1994
(Unaudited) (Note)
------------- -------------
<S> <C> <C>
ASSETS
- ------
CURRENT ASSETS:
Cash $ 149,730 $ 86,260
Trade accounts receivable 2,548,329 1,487,150
Inventories:
Finished goods 1,047,165 1,114,575
Work in process and raw materials 8,204,684 8,709,074
Deferred income taxes 671,000 671,000
Prepaid expenses and other 98,419 102,317
----------- -----------
TOTAL CURRENT ASSETS 12,719,327 12,170,376
PROPERTY, PLANT, AND EQUIPMENT 10,742,051 10,076,780
less-accumulated depreciation 6,458,443 6,306,302
----------- -----------
4,283,608 3,770,478
OTHER ASSETS 187,205 384,946
----------- -----------
$17,190,140 $16,325,800
=========== ===========
</TABLE>
Note: The balance sheet at December 31, 1994 has been derived from the audited
financial statements at that date.
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
EDAC TECHNOLOGIES CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31 December 31
1995 1994
(Unaudited) (Note)
------------ ------------
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
CURRENT LIABILITIES:
Revolving line of credit $ 1,663,031 $ 1,595,367
Current portion of long-term debt 247,861 245,383
Trade accounts payable 2,941,593 2,083,701
Employee compensation and
amounts withheld 683,374 638,068
Accrued expenses 805,650 760,533
----------- -----------
TOTAL CURRENT LIABILITIES 6,341,509 5,323,052
LONG-TERM DEBT,
less current portion 3,760,482 3,824,061
OTHER LIABILITIES 88,072 296,840
DEFERRED INCOME TAXES 710,000 710,000
SHAREHOLDERS' EQUITY:
Common stock, par value $.0025 per
share; 10,000,000 shares authorized;
issued and outstanding--3,595,539
in 1995 and in 1994 8,989 8,989
Additional paid-in-capital 8,560,672 8,560,672
Accumulated deficit (1,816,430) (1,915,216)
----------- -----------
6,753,231 6,654,445
Less guaranty of Employee Stock
Ownership Plan debt (330,556) (350,000)
Less unfunded accrued
pension costs (132,598) (132,598)
----------- -----------
6,290,077 6,171,847
----------- -----------
$17,190,140 $16,325,800
=========== ===========
</TABLE>
Note: The balance sheet at December 31, 1994 has been derived from the audited
financial statements at that date.
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
EDAC TECHNOLOGIES CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 31
-------------------------
1995 1994
------------ -----------
<S> <C> <C>
Operating Activities:
Net income $ 98,786 $ 133,646
Depreciation and
amortization 270,695 242,996
Changes in working
capital items 254,066 (201,444)
Other (5,800) 3,858
--------- ---------
Net cash provided by
operating activities 617,747 179,056
Investing Activities:
Additions to property,
plant and equipment (856,736) (47,594)
Proceeds from sales of
property plant and
equipment 98,155 9,000
Other 197,741 (19,749)
--------- ---------
Net cash used in
investing activities (560,840) (58,343)
Financing Activities:
Increase (decrease) in
revolving line of credit 67,664 (33,318)
Payments of long term
debt (61,101) (69,393)
--------- ---------
Net cash used in
investing activities 6,563 (102,711)
Increase in cash 63,470 18,002
Cash at the beginning of
year 86,260 111,754
--------- ---------
Cash at end of period $ 149,730 $ 129,756
========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
EDAC TECHNOLOGIES CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
MARCH 31, 1995
NOTE A -- BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been prepared
in accordance with the generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals and adjustments to previously established loss
provisions) considered necessary for a fair presentation have been included.
Operating results for the three month period ending March 31, 1995 are not
necessarily indicative of the results that may be expected for the year ending
December 31, 1995. For further information, refer to the financial statements
and footnotes thereto included in the Company's annual report on Form 10-K for
the year ended December 31, 1994.
6
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
- ---------------------------------------------
Sales. The Company's sales in the first quarter of 1995 decreased $274,000 or
- ------
3.8% compared to the first quarter of 1994. This decrease is due mainly to the
loss of the Company's principal medical customer in 1994.
Cost of Sales. Cost of sales as a percentage of sales increased by 2.0% of sales
- --------------
compared to the first quarter of 1994. This is due to increased direct costs as
a percentage of sales and increased payroll taxes and repair costs.
Selling, General & Administrative. Selling, general and administrative costs
- ----------------------------------
decreased from $733,000 to $707,000 or 3.6% for the first quarter of 1995
compared to the first quarter of 1994. This is due to decreased compensation
expense and reduced pension expense compared to the first quarter of 1994.
Interest. Interest expense for the quarter ended March 31, 1995 was $121,000 an
- ---------
increase of $15,000 from the corresponding quarter of 1994. This reflects
increasing interest rates on the Company's revolving line of credit.
Liquidity and Capital Expenditures. The Company has proceeded with its planned
- -----------------------------------
capital expenditures for 1995 (Reference the Company's 1994 Annual Report). The
Company has financed its capital additions by taking advances on its equipment
lines of credit and with funds generated by operations. Although classified as
current liabilities, both equipment lines are payable in 60 equal monthly
payments, one commencing February 1, 1995 and the other commencing February 1,
1996. (See Note C of the Company's 1994 Annual Report).
Management believes that the funds generated from operations and its credit
facilities will be sufficient to meet the Company's cash requirements for 1995.
7
<PAGE>
PART 11 -- OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
(11) Statement re: computation of earnings per share
(b) Reports on Form 8-K
None
8
<PAGE>
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.
EDAC TECHNOLOGIES CORPORATION
May 12, 1995 By /s/ Glenn L. Purple
----------------------------
Glenn L. Purple, Chief Financial Officer
and duly authorized officer
9
<PAGE>
EXHIBIT INDEX
Page Number
in Sequential
NUMBER DESCRIPTION Numbering System
- ------ ----------- ----------------
11 Statement Regarding Computation of
Per Share Earnings
10
<PAGE>
(11)--STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
EDAC TECHNOLOGIES CORPORATION
<TABLE>
<CAPTION>
Three Months Ended
March 31
---------------------
1995 1994
--------- ---------
<S> <C> <C>
Primary:
Average shares outstanding 3,595,539 3,566,205
Net effect of dilutive stock
options based on the
treasury stock method using
average market price 120,456 113,623
---------- ----------
TOTALS 3,715,995 3,679,828
========== ==========
Net income $ 98,786 $ 133,646
========== ==========
Net income per share $ 0.03 $ 0.04
========== ==========
Fully diluted:
Average shares outstanding 3,595,539 3,566,205
Net effect of dilutive stock
options based on the
treasury stock method using
quarter end market price
if higher than average
market price 124,708 118,319
---------- ----------
TOTALS 3,720,247 3,684,524
========== ==========
Net income $ 98,786 $ 133,646
========== ==========
Net income per share $ 0.03 $ 0.04
========== ==========
</TABLE>
11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<CASH> 149,730
<SECURITIES> 0
<RECEIVABLES> 2,548,329
<ALLOWANCES> 40,000
<INVENTORY> 9,251,849
<CURRENT-ASSETS> 12,719,327
<PP&E> 10,742,051
<DEPRECIATION> 6,458,443
<TOTAL-ASSETS> 17,190,140
<CURRENT-LIABILITIES> 6,341,509
<BONDS> 3,760,482
<COMMON> 8,989
0
0
<OTHER-SE> 6,281,088
<TOTAL-LIABILITY-AND-EQUITY> 17,190,140
<SALES> 7,154,396
<TOTAL-REVENUES> 7,516,249
<CGS> 6,587,913
<TOTAL-COSTS> 6,587,913
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 121,244
<INCOME-PRETAX> 109,290
<INCOME-TAX> 10,504
<INCOME-CONTINUING> 98,786
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 98,786
<EPS-PRIMARY> .03
<EPS-DILUTED> .03
</TABLE>
