<PAGE> 1
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED DECEMBER 31, 1995
Commission File Number 0-2762
MAXCO, INC.
(Exact Name of Registrant as Specified in its Charter)
Michigan 38-1792842
-------- ----------
(State or other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
1118 Centennial Way
Lansing, Michigan 48917
(Address of principal executive offices) (Zip Code)
Registrant's Telephone Number, including area code: (517) 321-3130
--------------
Indicate by check mark whether the registrant (1) has filed all annual,
quarterly and other reports required to be filed by Section 12 or 15(d) of the
Securities Exchange Act of 1934 during the preceding twelve months and (2) has
been subject to the filing requirements for at least the past 90 days.
Yes x No
--------- --------
Indicate the number of shares outstanding for each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at December 31, 1995
----- --------------------------------
Common Stock 4,227,442 shares
===============================================================================
1
<PAGE> 2
PART I
FINANCIAL INFORMATION
CONSOLIDATED BALANCE SHEETS
Maxco, Inc. and Subsidiaries
<TABLE>
<CAPTION>
December 31, March 31,
1995 1995
------------ ---------
(Unaudited)
(In thousands)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 943 $ 3,029
Marketable Securities - current--Note D 2,294
Accounts receivable, less allowance
of $603,000 ($548,000 at March 31, 1995) 26,311 21,899
Inventories--Note B 27,922 19,581
Prepaid expenses and other 487 116
-------- ---------
TOTAL CURRENT ASSETS 55,663 46,919
MARKETABLE SECURITIES - LONG-TERM--Note D 13,682 4,552
PROPERTY, PLANT AND EQUIPMENT:
Land 865 831
Buildings and improvements 10,392 8,419
Machinery, equipment and fixtures 20,880 17,920
-------- ---------
32,137 27,170
Allowances for depreciation (deduct) (13,364) (11,825)
-------- ---------
18,773 15,345
OTHER ASSETS:
Investments 2,910 7,396
Notes and contracts receivable and other 1,107 1,275
Intangibles 18,987 10,090
-------- ---------
23,004 18,761
-------- ---------
$111,122 $ 85,577
======== =========
</TABLE>
2
<PAGE> 3
<TABLE>
<CAPTION>
December 31, March 31,
1995 1995
------------ ------------
<S> <C> <C>
(Unaudited)
(In thousands)
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable $4,926 $236
Accounts payable 16,403 16,240
Employee compensation 1,824 2,629
Taxes, interest and other liabilities 1,735 1,307
Current maturities of long-term obligations 4,116 2,594
-------- -------
TOTAL CURRENT LIABILITIES 29,004 23,006
LONG-TERM OBLIGATIONS, less current maturities 37,551 24,879
DEFERRED INCOME TAXES 7,500 5,515
INTERESTS OF MINORITY HOLDERS IN SUBSIDIARY 10,305 9,445
STOCKHOLDERS' EQUITY:
Preferred stock:
Series Two: 12% cumulative redeemable, convertible,
$50 par value; 18,000 shares issued 900 900
Series Three: 10% cumulative redeemable,
$60 face value; 16,219 shares issued 754 755
Common stock, $1 par value, 10,000,000
shares authorized, 4,227,442 shares issued
(4,289,652 shares at March 31, 1995) 4,227 4,290
Additional paid-in capital 686 1,190
Net unrealized gain (loss) on marketable securities 4,148 (60)
Retained earnings 16,047 15,657
-------- -------
26,762 22,732
-------- -------
$111,122 $85,577
======== =======
</TABLE>
See notes to consolidated financial statements
3
<PAGE> 4
CONSOLIDATED STATEMENTS OF OPERATIONS
MAXCO, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
Three Months Ended December 31,
1995 1994
---- ----
(Unaudited) (Unaudited)
(In thousands, except per share data)
<S> <C> <C>
Net sales $46,719 $38,027
Costs and expenses:
Cost of sales and operating 39,585 31,953
Selling, general and administrative 4,847 4,126
Depreciation and amortization 1,082 799
------- -------
45,514 36,878
------- -------
OPERATING EARNINGS 1,205 1,149
Investment income 24 221
Interest expense (721) (507)
------- -------
INCOME BEFORE FEDERAL INCOME TAXES
AND EQUITY IN OPERATION OF AFFILIATES 508 863
Federal income taxes 179 305
------- -------
INCOME BEFORE EQUITY IN EARNINGS
AND MINORITY INTEREST 329 558
Minority interest and equity in earnings of affiliates (247) (216)
------- -------
NET INCOME $ 82 $ 342
------- -------
Less preferred stock dividend and other (51) (51)
------- -------
NET INCOME APPLICABLE
TO COMMON STOCK $ 31 $ 291
======= =======
Net income per share - Note A $ .01 $ .07
======= =======
Weighted average number of shares of
common stock and common stock
equivalents outstanding 4,349 4,424
======= =======
</TABLE>
See notes to consolidated financial statements
4
<PAGE> 5
CONSOLIDATED STATEMENTS OF OPERATIONS
MAXCO, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
Nine Months Ended December 31,
1995 1994
---- ----
(Unaudited) (Unaudited)
(In thousands, except per share data)
<S> <C> <C>
Net sales $142,108 $116,914
Costs and expenses:
Cost of sales and operating expenses 120,320 98,435
Selling, general and administrative 14,624 11,864
Depreciation and amortization 3,017 2,237
-------- --------
137,961 112,536
-------- --------
OPERATING EARNINGS 4,147 4,378
Investment Income 174 675
Interest expense (2,162) (1,375)
Gain on issuance and sales of Medar Stock 3,100
-------- --------
INCOME BEFORE FEDERAL INCOME TAXES
AND EQUITY IN OPERATIONS OF AFFILIATES 2,159 6,778
Federal income taxes 755 2,375
-------- --------
INCOME BEFORE EQUITY IN EARNINGS
AND MINORITY INTEREST 1,404 4,403
Minority interest and equity in earnings of affiliates (860) (443)
-------- --------
NET INCOME $ 544 $ 3,960
Less preferred stock dividend and other (153) (153)
-------- --------
NET INCOME APPLICABLE
TO COMMON STOCK $ 391 $ 3,807
======== ========
Net income per share - Note A $ .09 $ .83
======== ========
Weighted average number of shares of common stock and
common stock equivalents outstanding 4,377 4,430
======== ========
</TABLE>
See notes to consolidated financial statements
5
<PAGE> 6
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONDENSED)
MAXCO, INC. AND SUBSIDIARIES
<TABLE>
<CAPTION>
Nine Months Ended December 31,
1995 1994
---- ----
(Unaudited) (Unaudited)
(In thousands)
<S> <C> <C>
OPERATING ACTIVITIES
Net Income $ 544 $ 3,960
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 3,017 2,237
Other gains (3,100)
Deferred taxes (153) 225
Minority interest and equity in earnings of affiliates 860 443
Changes in operating assets and liabilities (7,622) (5,379)
------- --------
NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES (3,354) (1,614)
INVESTING ACTIVITIES
Purchase of business assets (9,238) (3,847)
Purchases of property and equipment (4,431) (2,117)
Investment in real estate development (2,642)
Net proceeds from sale of common stock 1,567
Sale of (investment in) marketable securities 6,906 (10,342)
Other 100 (170)
------- --------
NET CASH USED IN INVESTING ACTIVITIES (9,305) (14,909)
FINANCING ACTIVITIES
Proceeds from notes payable 4,690
Proceeds from long-term obligations 9,920 4,676
Repayments on long-term obligations (3,317) (1,509)
Proceeds from exercise of stock options 10 111
Acquisition and retirement of common stock (577) (412)
Dividends paid on preferred stock (153) (153)
------- --------
NET CASH PROVIDED BY
FINANCING ACTIVITIES 10,573 2,713
------ --------
DECREASE IN CASH AND
CASH EQUIVALENTS (2,086) (13,810)
Cash and cash equivalents at beginning of period 3,029 14,822
------- --------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 943 $ 1,012
======= ========
</TABLE>
See notes to consolidated financial statements
6
<PAGE> 7
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MAXCO, INC. AND SUBSIDIARIES
DECEMBER 31, 1995
NOTE A - Basis of Presentation
The accompanying unaudited, condensed, consolidated financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and notes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary
for a fair presentation of the results of the interim periods covered have
been included. For further information, refer to the consolidated financial
statements and notes thereto included in Maxco's annual report on Form 10-K
for the year ended March 31, 1995.
The results of operations for the interim periods presented are not
necessarily indicative of the results for the full year. The effect of stock
options and potential conversion of redeemable convertible preferred stock
was anti-dilutive for the three and nine months ended December 31, 1995.
NOTE B - Inventories
The major classes of inventories, at the dates indicated were as follows:
<TABLE>
<CAPTION>
December 31, March 31,
1995 1995
-------------- ---------
(Unaudited)
(In thousands)
<S> <C> <C>
Raw materials $1,436 $1,586
Finished goods and
work in progress 2,593 2,116
Purchased products
for resale 23,893 15,879
------- -------
$27,922 $19,581
======= =======
</TABLE>
NOTE C - Acquisitions
During the nine months ended December 31, 1995, Maxco's FinishMaster
subsidiary acquired the assets of thirteen auto paint distributors for a
purchase price of approximately $16.8 million ($9.2 million net of
acquisition debt). These acquisitions have been accounted for as purchases
and accordingly, the acquired assets and liabilities have been recorded at
their estimated fair values at the dates of acquisition. Intangible assets
related to goodwill and covenants not to compete were recorded with each
acquisition. Operating results of these acquired organizations were included
in the Company's financial statements from the date of purchase. These
acquisitions were not material in size or scope relative to Maxco's business.
7
<PAGE> 8
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
MAXCO, INC. AND SUBSIDIARIES
NOTE D - Marketable Securities
The Company classifies its marketable securities as securities available for
sale under FASB 115, Accounting for Certain Investments in Debt and Equity
Securities. Available-for-sale securities are carried at fair value, with
the unrealized gains and losses, net of tax, reported as a separate component
of stockholders' equity. During the first quarter of 1995, Maxco began to
account for its investment in Medar stock as marketable securities available
for sale under FASB 115 because Maxco's ownership of Medar was reduced to
less than 20% of Medar's outstanding shares. Application of this method
resulted in an unrealized gain of approximately $4.1 million, net of deferred
tax, being reported as part of stockholders' equity at December 31, 1995.
The following is a summary of marketable securities available for sale at
December 31, 1995.
<TABLE>
<CAPTION>
Gross Gross
Amortized Unrealized Unrealized Estimated
Cost Gains Losses Fair Value
--------- ---------- ---------- ----------
(in thousands)
<S> <C> <C> <C> <C>
Corporate Securities - Medar $7,396 $6,286 $13,682
</TABLE>
NOTE E - Long-Term Debt
Maxco's revolving credit agreement allows Maxco to borrow up to $20.0 million
with limitations based on the value of certain assets. At December 31, 1995,
$2.1 million was available under this agreement. A separate acquisition line
of up to $5.0 million was secured by Maxco during the second quarter. This
facility was unused at December 31, 1995.
During the first quarter, the Company's FinishMaster subsidiary secured a
commitment for a $5.0 million unsecured line of credit to fund periodic
working capital requirements and a separate unsecured $12 million credit
facility to fund acquisitions. At December 31, 1995, approximately $4.7
million was outstanding under these lines. Approximately $13.1 million of
Maxco's consolidated long-term debt of $41.7 million at December 31, 1995
($10.9 million net of current maturities), were direct obligations of
FinishMaster.
8
<PAGE> 9
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MAXCO, INC. AND SUBSIDIARIES
DECEMBER 31, 1995
MATERIAL CHANGES IN FINANCIAL CONDITION
Stockholders' equity increased by approximately $4.0 million to $26.8 million
at December 31, 1995, from $22.7 million at March 31, 1995. This increase was
due primarily to the application of FASB 115, Accounting for Certain
Investments in Debt and Equity Securities. Effective April 1995, Maxco changed
its method of accounting for its investment in Medar, Inc. from the equity
method to that of an equity security available for sale. This change is
required under the provisions of FASB 115 due to the reduction of Maxco's
ownership of Medar to less than 20%. Application of this method at December
31, 1995 resulted in an unrealized gain of approximately $4.1 million, net of
tax, being reported as a separate component of stockholders' equity. The
1,737,405 shares of Medar common stock which Maxco owns had an aggregate market
value of approximately $13.7 million at December 31, 1995.
Net cash used in investing activities was the primary reason that cash and cash
equivalents decreased by $2,100,000 during the nine-months. Cash was also
consumed during the nine months by increases in accounts receivable, inventory,
and other working capital items as a result of higher sales levels and
acquisitions.
Cash was used in investing activities during the nine-months for the
acquisition of thirteen auto paint distributors by FinishMaster. Maxco also
continued development of a site for commercial office and retail use. In
addition, two construction projects consisting of new office, warehouse and
manufacturing facilities for Akemi and Wisconsin Wire & Steel were begun during
this period and related financing for these projects was obtained. Long-term
debt issued in conjunction with these projects, to purchase acquisitions and
additional borrowings under Maxco's revolving line of credit, resulted in
long-term debt increasing $12.7 million since year end.
Subsequent to December 31, 1995, FinishMaster agreed to purchase the assets of
several businesses in their existing regional markets. The aggregate purchase
price amounts to $5.9 million of which $3.2 million will be financed by the
sellers with the remainder being financed by FinishMaster's acquisition line.
Maxco holds 4.0 million shares of FinishMaster which has a separate public
market for its stock. The aggregate market value of these shares was $52.6
million at December 31, 1995. The investments in FinishMaster and Medar
represent a substantial source of capital which Maxco has available. The
amount that could ultimately be realized by Maxco on the sale of any of these
shares will be dependent on the amount offered, general market conditions, and
various other factors.
9
<PAGE> 10
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MAXCO, INC. AND SUBSIDIARIES
(CONTINUED)
During the nine months ended December 31, 1995, Maxco's revolving line of
credit was amended to allow Maxco to borrow up to $20.0 million with
limitations based on the value of certain assets. An additional facility of
$5.0 million was secured at the same time. Use of this facility is restricted
to acquisitions by the company and is subject to certain conditions. These
borrowings bear interest at rates approximating one-half percent below the
prime rate of interest.
The Company believes that its current financial resources, together with cash
generated from operations and its available resources under its lines of
credit, will be adequate to meet cash requirements for the next year. The
Company's FinishMaster subsidiary secured a commitment during the first quarter
for a $5.0 million unsecured line of credit to fund periodic working capital
requirements and a separate unsecured $12.0 million credit facility to fund
acquisitions. Approximately $4.7 million was outstanding under these lines at
December 31, 1995.
MATERIAL CHANGES IN RESULTS OF OPERATIONS
Three Months Ended December 31, 1995 Compared to 1994
Net sales increased 23% to $46.7 million compared to $38.0 million in last
year's third quarter. Net income decreased to $0.1 million or $.01 per share
from last year's $0.3 million or $.07 per share.
The sales growth for the three months ended December 31, 1995 was primarily
attributable to FinishMaster as sales at this unit increased $7.8 million over
last year. Sales generated by recently acquired outlets accounted for
approximately $6.9 million of FinishMaster's increase with the remainder due to
increased market penetration in the Dallas, Texas and outstate Michigan areas.
Operating earnings for the three months ended December 31, 1995 were comparable
with the 1994 level. Increase in operating profits at FinishMaster and Ersco
during this period were offset by a decline at Akemi.
Proceeds from FinishMaster's initial public offering which previously were
invested in interest bearing investments were used to fund acquisitions. The
impact of this was a decrease of approximately $200,000 in investment income in
this year's third quarter.
The increase in interest expense was primarily due to increased borrowings
under the Company's line of credit and additional borrowings for acquisitions.
10
<PAGE> 11
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MAXCO, INC. AND SUBSIDIARIES
(CONTINUED)
Nine Months Ended December 31, 1995 Compared to 1994
Net sales increased 21.5% to $142.1 million compared to $116.9 million in last
year's nine month period. Net income decreased to $0.5 million or $.09 per
share from last year's $4.0 million or $.83 per share.
The most significant impact on net income for the nine months ended December
31, 1994 was a $3.1 million pre-tax gain recognized by Maxco as a result of the
sale by Medar of 1.3 million shares of Medar common stock to the public. This
gain represented the net increase in value of Maxco's investment in Medar and
the gain realized on the sale of 145,000 shares of Medar stock owned by Maxco
to cover the over allotments by the underwriter. No comparable event occurred
in the current year.
The sales growth for the nine months ended December 31, 1995 was primarily
attributable to FinishMaster and the Construction Supplies group. Sales
increased $2.4 million at Maxco's construction supplies businesses as a result
of strong demand in their market area and additional value added products being
added to their steel and mesh lines. Sales at FinishMaster increased $19.8
million over last year. Of the net sales increase for FinishMaster, $18.7
million resulted from sales generated by recently acquired outlets with the
remainder coming from same outlet sales.
Increased volumes and margins at FinishMaster and the Construction Supplies
group allowed these units to have an increase in operating earnings over the
comparable period in the prior year. Acquisition related costs due to rapid
expansion into two new regions, coupled with flat same outlet sales, caused
operating income at FinishMaster, however, to grow at a slower rate than sales.
The operating income improvements for FinishMaster and the construction
supplies group were offset by reduced operating earnings at Maxco's other
operations. Earnings at Wright Plastics were over $900,000 lower this nine
month period due to market constraints on margins and manufacturing
inefficiencies at its two facilities. Increased staffing levels to support
anticipated growth, which has not materialized at this point, at Wright as well
as Akemi and Pak-Sak also contributed to lower earnings for the period. Lower
earnings at both Wright and Akemi resulted in operating losses for the nine
months at both these units.
Net income for the nine months was affected by a reduction in investment income
compared with the same period last year. Funds from FinishMaster's initial
public offering invested in the prior year were redeployed to fund
FinishMaster's rapid acquisition program.
The increase in interest expense was primarily due to increased borrowings
under the Company's line of credit and additional borrowings for acquisitions.
11
<PAGE> 12
PART II
OTHER INFORMATION
<TABLE>
<CAPTION>
<S> <C>
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
3 Restated Articles of Incorporation and By-laws are hereby incorporated
by reference from Form S-4 dated November 4, 1991 (File No. 33-43855).
4.1 Resolution establishing Series Two Preferred Shares is hereby
incorporated by reference from Form S-4 dated November 4, 1991 (File
No. 33-43855).
4.2 Resolution establishing Series Three Preferred Shares is hereby
incorporated by reference from Form S-4 dated November 4, 1991 (File
No. 33-43855).
10.1 Incentive stock option plan adopted August 15, 1983, including the
amendment (approved by shareholders August 25, 1987) to increase the
authorized shares on which options may be granted by two hundred fifty
thousand (250,000), up to five hundred thousand (500,000) shares of the
common stock of the company is hereby incorporated by reference from
the registrant's annual report on Form 10-K for the fiscal year ended
March 31, 1988.
10.3 Amended and restated loan agreement between Comerica Bank and Maxco,
Inc. dated as of October 31, 1994 is hereby incorporated by reference
from registrant's Form 10-K dated June 13, 1995.
</TABLE>
12
<PAGE> 13
10.4 First amendment to the amended and restated loan agreement between
Comerica Bank and Maxco, Inc., dated as of May 9, 1995 is hereby
incorporated by reference from registrants Form 10-K dated June 13,
1995.
10.5 Second amendment to the amended and restated loan agreement between
Comerica Bank and Maxco, Inc. dated as of September 8, 1995 is hereby
incorporated by reference from registrant's Form 10-Q dated November
10, 1995.
11* Statement Re: Computation of Per Share Earnings
27* Financial Data Schedule
No reports on Form 8-K were filed during the quarter.
*Filed herewith
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.
MAXCO, INC.
Date February 9, 1996 /S/ VINCENT SHUNSKY
---------------- --------------------------------------
Vincent Shunsky, Vice President-Finance
and Treasurer (Principal Financial and
Accounting Officer)
13
<PAGE> 14
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<S> <C>
3 Restated Articles of Incorporation and By-laws are hereby incorporated
by reference from Form S-4 dated November 4, 1991 (File No. 33-43855).
4.1 Resolution establishing Series Two Preferred Shares is hereby
incorporated by reference from Form S-4 dated November 4, 1991 (File No.
33-43855).
4.2 Resolution establishing Series Three Preferred Shares is hereby
incorporated by reference from Form S-4 dated November 4, 1991 (File No.
33-43855).
10.1 Incentive stock option plan adopted August 15, 1983, including the
amendment (approved by shareholders August 25, 1987) to increase the
authorized shares on which options may be granted by two hundred fifty
thousand (250,000), up to five hundred thousand (500,000) shares of the
common stock of the company is hereby incorporated by reference from the
registrant's annual report on Form 10-K for the fiscal year ended March
31, 1988.
10.3 Amended and restated loan agreement between Comerica Bank and Maxco,
Inc. dated as of October 31, 1994 is hereby incorporated by reference
from registrant's Form 10-K dated June 13, 1995.
10.4 First amendment to the amended and restated loan agreement between
Comerica Bank and Maxco, Inc., dated as of May 9, 1995 is hereby
incorporated by reference from registrants Form 10-K dated June 13,
1995.
10.5 Second amendment to the amended and restated loan agreement between
Comerica Bank and Maxco, Inc. dated as of September 8, 1995 is hereby
incorporated by reference from registrant's Form 10-K dated November 10,
1995.
11* Statement Re: Computation of Per Share Earnings
27* Financial Data Schedule
No reports on Form 8-K were filed during the quarter.
</TABLE>
*Filed herewith
14
<PAGE> 1
MAXCO, INC.
EXHIBIT 11 - STATEMENT RE: COMPUTATION OF
PER SHARE EARNINGS
<TABLE>
<CAPTION>
Three Months Ended December 31,
1995 1994
---- ----
<S> <C> <C>
NET INCOME FOR COMPUTATION
OF PER SHARE AMOUNTS
- ------------------------------------
Net income $ 82,000 $ 342,000
Preferred stock series 2 dividend (27,000) (27,000)
Preferred stock series 3 dividend (24,000) (24,000)
---------- ----------
NET INCOME ATTRIBUTABLE
TO COMMON STOCK--PRIMARY $ 31,000 $ 291,000
========== ==========
NET INCOME ATTRIBUTABLE
TO COMMON STOCK--FULLY DILUTED $ 58,000 $ 318,000
========== ==========
PRIMARY
- ------------------------------------
Average shares outstanding 4,231,899 4,300,063
Net effect of dilutive stock options--based
on the Treasury Stock Method using
average market price 116,659 124,169
---------- ----------
TOTAL 4,348,558 4,424,232
PER SHARE AMOUNT $ 0.01 $ 0.07
FULLY DILUTED
- ------------------------------------
Average shares outstanding 4,231,899 4,300,063
Net effect of dilutive stock options--based
on the Treasury Stock Method using the
quarter-end market price if higher than
average market price 116,659 124,169
Assumed conversion of series two 12%
cumulative redeemable convertible
preferred stock 231,840 231,840
---------- ----------
TOTAL 4,580,398 4,656,072
========== ==========
PER SHARE AMOUNT $ 0.01 $ 0.07
</TABLE>
15
<PAGE> 2
MAXCO, INC.
EXHIBIT 11 - STATEMENT RE: COMPUTATION OF
PER SHARE EARNINGS
<TABLE>
<CAPTION>
Nine Months Ended December 31,
1995 1994
---- ----
<S> <C> <C>
NET INCOME FOR COMPUTATION
OF PER SHARE AMOUNTS
- -----------------------------------------------
Net income $544,000 $3,960,000
Preferred stock series 2 dividend (81,000) (81,000)
Preferred stock series 3 dividend (72,000) (72,000)
---------- ----------
NET INCOME ATTRIBUTABLE
TO COMMON STOCK--PRIMARY $391,000 $3,807,000
========== ==========
NET INCOME ATTRIBUTABLE
TO COMMON STOCK--FULLY DILUTED $472,000 $3,888,000
========== ==========
PRIMARY
- -----------------------------------------------
Average shares outstanding 4,258,619 4,305,055
Net effect of dilutive stock options--based on
the Treasury Stock Method using average
market price 118,641 124,813
---------- ----------
TOTAL 4,377,260 4,429,868
PER SHARE AMOUNT $0.09 $0.86
FULLY DILUTED
- -----------------------------------------------
Average shares outstanding 4,258,619 4,305,055
Net effect of dilutive stock options--based on
the Treasury Stock Method using the
quarter-end market price if higher than
average market price 118,641 124,813
Assumed conversion of series two 12%
cumulative redeemable convertible
preferred stock 231,840 231,840
---------- ----------
TOTAL 4,609,100 4,661,708
========== ==========
PER SHARE AMOUNT $ 0.10 $ 0.83
</TABLE>
For 1995, the aggregate dilution from stock options is anti-dilutive.
16
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q
FOR THE QUARTER ENDED DECEMBER 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS AND NOTES THERETO.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAR-31-1996
<PERIOD-START> APR-01-1995
<PERIOD-END> DEC-31-1995
<CASH> 943
<SECURITIES> 0
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0
1,654
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</TABLE>
