<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended January 31, 1996
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACTO OF 1934
For the transition period from to
Commission file number: 0-15486
MIKRON INSTRUMENT COMPANY, INC.
(Exact Name of Registrant as Specified in its Charter)
New Jersey 22-1895668
State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
16 Thornton Road, Oakland, New Jersey 07436
(Address of Principal Executive Office) (Zip Code)
(201) 405-0900
(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
------- --------
The number of shares of registrant's Common Stock, $.003 par value, outstanding
as of January 31, 1996 was 3,654,200 shares.
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MIKRON INSTRUMENT COMPANY, INC.
INDEX
<TABLE>
<CAPTION>
Page Number
-------------------
<S> <C>
PART I - FINANCIAL INFORMATION
Balance Sheet - January 31, 1996 and October 31, 1995 1
Statement of Operations - Three months ended January 31, 1996
and 1995 2
Statement of Cash Flows - Three months ended January 31, 1996
and 1995 3
Notes to Financial Statements 4
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS 5
PART II - OTHER INFORMATION 6
SIGNATURES 7
</TABLE>
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MIKRON INSTRUMENTS COMPANY, INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
January 31,
1996 October 31,
(Unaudited) 1995
---------- ----------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 275,496 $ 463,832
Investment securities 349,750 400,000
Trade accounts receivable, less allowance for
doubtful accounts of $107,000 in 1996 and 1995 1,129,293 1,146,121
Inventories 2,246,301 2,070,365
Prepaid expenses and other current assets 28,659 28,142
---------- ----------
TOTAL CURRENT ASSETS 4,029,499 4,108,460
PROPERTY AND EQUIPMENT, net 201,712 110,383
OTHER ASSETS 125,000 137,500
---------- ----------
$4,356,211 $4,356,343
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued liabilities $ 762,602 $ 780,686
Current maturity of long-term liability 50,000 50,000
---------- ----------
TOTAL CURRENT LIABILITIES 812,602 830,686
---------- ----------
LONG-TERM LIABILITY 87,500 100,000
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COMMITMENTS
STOCKHOLDERS' EQUITY
Common stock, $.003 par value;
authorized - 15,000,000 shares; issued and outstanding
3,654,200 shares in 1996 and 1995 12,181 12,181
Additional paid-in capital 3,151,831 3,151,831
Retained earnings 292,097 261,645
---------- ----------
TOTAL STOCKHOLDERS' EQUITY 3,456,109 3,425,657
---------- ----------
$4,356,211 $4,356,343
========== ==========
</TABLE>
See notes to financial statements.
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<PAGE> 4
MIKRON INSTRUMENT COMPANY, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three months ended
January 31,
-----------------------
1996 1995
---------- ----------
<S> <C> <C>
REVENUES:
Net sales $1,608,561 $1,341,450
Royalties 25,000 32,721
Investment income 9,620 7,854
---------- ----------
TOTAL REVENUES 1,643,181 1,382,025
---------- ----------
COSTS AND EXPENSES:
Cost of goods sold 722,615 615,115
Selling, general and administrative 776,969 646,169
Research and development 113,145 101,722
---------- ----------
TOTAL COSTS AND EXPENSES 1,612,729 1,363,006
---------- ----------
NET INCOME (LOSS) $ 30,452 $ 19,019
========== ==========
NET INCOME (LOSS) PER SHARE $ 0.01 $ 0.01
========== ==========
WEIGHTED AVERAGE NUMBER OF SHARES 3,734,856 3,688,050
========== ==========
</TABLE>
See notes to financial statements.
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<PAGE> 5
MIKRON INSTRUMENT COMPANY, INC.
STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three months ended
January 31,
----------------------
1996 1995
--------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 30,452 $ 19,019
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depreciation 17,083 15,804
Amortization 12,500 --
--------- ---------
60,035 34,823
Changes in assets and liabilities:
(Increase) decrease in trade accounts receivable 16,828 (64,481)
(Increase) decrease in inventories (175,936) (275,569)
(Increase) in prepaid and other current assets (517) (306)
Increase (decrease) in accounts payable and accrued liabilities (18,083) 147,008
--------- ---------
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES (117,673) (158,525)
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (108,413) (8,007)
Decrease in Long-Term Liability (12,500) --
--------- ---------
NET CASH (USED) PROVIDED BY INVESTING ACTIVITIES (120,913) (8,007)
--------- ---------
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (238,586) (166,532)
CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR 863,832 876,513
--------- ---------
CASH AND CASH EQUIVALENTS - END OF YEAR $ 625,246 $ 709,981
========= =========
</TABLE>
See notes to financial statements.
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<PAGE> 6
MIKRON INSTRUMENT COMPANY, INC.
NOTES TO FINANCIAL STATEMENTS
JANUARY 31, 1996
(Unaudited)
1. BASIS OF PRESENTATION
The accompanying financial statements reflect all adjustments
which, in the opinion of management, are necessary for a fair presentation of
the financial position and the results of operations for the interim periods
presented.
Certain financial information which is normally included in
financial statements prepared in accordance with generally accepted accounting
principles, but which is not required for interim reporting purposes has been
condensed or omitted. The accompanying financial statements should be read in
conjunction with the financial statements and notes thereto as of October 31,
1995 contained in the Company's Annual Report on Form 10-K.
2. EARNINGS (LOSS) PER SHARE
Per share information is computed based on the weighted
average number of shares outstanding during the period.
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<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis provides information which
management believes is relevant to an assessment and understanding of the
Company's results of operations and financial condition. This discussion should
be read in conjunction with the financial statements and notes thereto appearing
elsewhere herein.
a. Results of Operations
Net sales for the quarter ended January 31, 1996 were
$1,608,000 as compared to net sales of $1,341,000 for the quarter ended
January 31, 1995. The cost of sales was 45% as compared to 46% for the
comparable 1995 period. The increase in sales was due to better
economic climate.
Selling, general and administrative expenses for the three
months ended January 31, 1996 were $777,000 as compared to $646,200 for
the same 1995 period. The increase represents normal salary
adjustments, hiring new people for the sales and quality control
departments and write-off of promotional materials.
Research and development expenses for the quarter ended
January 31, 1996 were $113,000 as compared to $102,000 for the quarter
ended January 31, 1995. The increase is attributable to the Company's
efforts to develop new infrared thermometers.
Other income for the three month period ended January 31, 1996
was $34,600. This represents $25,000 of royalty income and $9,600 of
investment income.
b. Material Change in Financial Condition, Liquidity and Capital Resources
The Company's working capital decreased from $3,278,000 at
October 31, 1995 to $3,217,000 at January 31, 1996.
At January 31, 1996, the Company's capital resources and its
sources of liquidity was $625,000 in cash and temporary cash
investments.
Management does not believe that a return of inflation will
have a material adverse effect on the Company's operations because it
believes that the Company will be able to increase its selling prices
to reflect most increases in its cost.
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<PAGE> 8
PART II - OTHER INFORMATION
Item 1 - LEGAL PROCEEDINGS - NONE
Item 2 - CHANGE IN SECURITIES - NONE
Item 3 - DEFAULTS UPON SENIOR SECURITIES - NONE
Item 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS - NONE
Item 5 - OTHER INFORMATION - NONE
Item 6 - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibit No. 11 - Statement re: Computation of per
share earnings incorporated by reference to statement of
income filed as part of this quarterly report on Form
10-Q.
(b) During the quarter ended January 31, 1996, the
Registrant filed two reports on Form 8-K:
(i) In an 8-K Report dated November 24,
1995, the Registrant reported on "Changes in
Control of Registrant" under Item 1, certain
"Other Events" under Item 5, and enclosed as
Exhibit 10 under Item 7 an "Amended and
Restated Employment Agreement and Covenant
Not to Compete between Mikron Instrument
Company, Inc. And Donald S. Michael dated as
of July 24, 1995."
(ii) In an 8-K Report dated January 3, 1996,
the Registrant reported on "Changes in
Control of Registrant" under Item 1 and
enclosed as Exhibit 10 under Item 7 an
"Investment Banking Agreement dated as of
October 1, 1995 between Mikron Instrument
Company, Inc. and Barber and Bronson
Incorporated."
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<PAGE> 9
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.
MIKRON INSTRUMENT COMPANY, INC.
/s/ Keikhosrow Irani
---------------------------------------------
Keikhosrow Irani, President, as Registrant's,
duly authorized officer
/s/ Douglas Frank
---------------------------------------------
Douglas Frank, Vice President and
Sales Manager
/s/ Alex Wu
---------------------------------------------
Alex Wu, Treasurer
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<PAGE> 10
EXHIBIT INDEX
Exhibit No. Description
- ---------- -----------
EX-27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE 10-Q
REPORT FOR THE QUARTER ENDED JANUARY 31, 1996 FOR MIKRON INSTRUMENT COMPNAY,
INC. AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH 10-Q REPORT FOR THE
QUARTER ENDED JANUARY 31, 1996 FOR MIKRON INSTRUMENT COMPANY.
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-31-1996
<PERIOD-START> NOV-01-1995
<PERIOD-END> JAN-31-1996
<EXCHANGE-RATE> 1
<CASH> 275,496
<SECURITIES> 349,750
<RECEIVABLES> 1,236,293
<ALLOWANCES> (107,000)
<INVENTORY> 2,246,301
<CURRENT-ASSETS> 4,029,499
<PP&E> 904,016
<DEPRECIATION> 702,304
<TOTAL-ASSETS> 4,356,211
<CURRENT-LIABILITIES> 812,602
<BONDS> 0
0
0
<COMMON> 12,181
<OTHER-SE> 3,443,928
<TOTAL-LIABILITY-AND-EQUITY> 4,356,211
<SALES> 1,608,561
<TOTAL-REVENUES> 1,643,181
<CGS> 722,615
<TOTAL-COSTS> 722,615
<OTHER-EXPENSES> 113,145
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 30,452
<INCOME-TAX> 0
<INCOME-CONTINUING> 30,452
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 30,452
<EPS-PRIMARY> 0.01
<EPS-DILUTED> 0
</TABLE>
