FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended December 31, 1997
Commission file number 0-14299
SECOM GENERAL CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 87-0410875
(State or other jurisdiction (I.R.S. Employer I.D. Number)
of incorporation or organization)
46035 GRAND RIVER AVENUE 48374
(Address of principal executive offices) (Zip Code)
Registrant's telephone number: 248-305-9410
Indicate by check mark whether the registrant (1) has filed all reports 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
requirement 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 close of the period covered by this report.
Title of Class Number of Shares Outstanding
Common Stock 5,335,400
<PAGE>
SECOM GENERAL CORPORATION
FORM 10-Q
QUARTER ENDED DECEMBER 31, 1997
INDEX
PART I FINANCIAL INFORMATION Page
Item 1. Financial Statements
Consolidated Balance Sheets.............................. 1
Consolidated Statements of Operations.................... 3
Consolidated Statements of Cash Flows.................... 4
Notes to Interim Consolidated
Financial Statements................................. 5
Item 2. Management's Discussion & Analysis of
Financial Condition and
Results of Operations................................ 8
PART II OTHER INFORMATION
Item 1. Legal Proceedings............................................. 12
Item 2. Changes in Securities......................................... 12
Item 3. Defaults in Securities........................................ 12
Item 4. Submission of Matters to a Vote
of Security Holders........................................ 12
Item 5. Other Information............................................. 12
Item 6. Exhibits and Reports on Form 8-K.............................. 12
<PAGE>
<TABLE>
<CAPTION>
ASSETS
DEC 31 1997 SEP 30 1997
----------- -----------
<S> <C> <C>
CURRENT ASSETS
Cash $ 107,700 $ 346,800
Accounts receivable, net 6,443,600 6,772,100
Other receivables 1,263,000 222,200
Inventories 5,706,600 6,136,900
Prepaids and other 393,400 465,900
Deferred tax asset 822,600 651,000
----------- -----------
TOTAL CURRENT ASSETS $14,736,900 $14,594,900
Cash restricted for equipment 14,000 526,500
Property, plant & equipment, net 27,915,200 28,002,300
Intangible asset 1,823,600 1,857,800
Other assets 1,216,700 1,226,800
----------- -----------
TOTAL ASSETS $45,706,400 $46,208,300
=========== ===========
<FN>
See notes to consolidated financial statements.
</TABLE>
1
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
DEC 31 1997 SEP 30 1997
----------- -----------
<S> <C> <C>
CURRENT LIABILITIES
Current maturities of long term obligations $ 2,745,100 $ 3,435,500
Trade accounts payable 5,196,500 4,002,100
Accrued wages and benefits 934,200 1,014,800
Accrued other 509,500 453,500
------------ ------------
TOTAL CURRENT LIABILITIES $ 9,385,300 $ 8,905,900
Long term obligations 17,513,700 17,710,600
Post retirement health care benefits 3,452,500 3,396,100
Other liabilities 569,000 485,100
Deferred tax liabilities 1,411,000 1,411,000
------------ ------------
TOTAL LIABILITIES $ 32,331,500 $ 31,908,700
------------ ------------
Stockholders' equity common stock, $.10 par
value 10,000,000 shares authorized:
December 31, 1997 - 5,335,400 shares issued
September 30, 1997 - 5,340,400 shares issued 533,500 534,000
Additional paid-in capital 18,401,000 18,412,400
Accumulated deficit (5,559,600) (4,646,800)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 13,374,900 14,299,600
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 45,706,400 $ 46,208,300
============ ============
<FN>
See notes to consolidated financial statements.
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF OPERATIONS
Three Months Three Months
Ended Ended
Dec 31 1997 Dec 31 1996
------------ ------------
<S> <C> <C>
NET SALES $ 12,134,800 $ 9,808,600
COST OF SALES 10,926,900 8,303,700
------------ ------------
GROSS PROFIT 1,207,900 1,504,900
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 1,872,600 1,435,700
------------ ------------
INCOME FROM OPERATIONS (664,700) 69,200
OTHER EXPENSE
Interest (400,500) (251,600)
Other, net (9,200) (18,500)
------------ ------------
LOSS BEFORE INCOME TAXES (1,074,400) (200,900)
INCOME TAX BENEFIT 161,600 67,500
------------ ------------
NET LOSS $ (912,800) $ (133,400)
============ ============
BASIC AND DILUTED LOSS PER COMMON SHARE $ (0.17) $ (0.02)
============ ============
BASIC AND DILUTED WEIGHTED AVERAGE
SHARES OUTSTANDING 5,335,900 5,349,100
<FN>
See notes to consolidated financial statements.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
STATEMENTS OF CASH FLOWS
Three Months Three Months
Ended Ended
Dec 31 1997 Dec 31 1996
------------ ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Loss from operations $ (912,800) $ (133,400)
Adjustments to reconcile net income to net cash used in operations:
Depreciation and amortization 920,700 649,300
Provision for (benefit from) deferred taxes (171,600) (67,500)
Loss on sales of assets 0 18,500
Increase in allowance for doubtful accounts 17,000 3,000
Provision for benefit obligations 73,900 80,000
Changes in assets and liabilities that provided (used) cash:
Accounts and other receivables (729,300) (1,078,100)
Inventories 430,300 (473,700)
Prepaids 72,400 131,100
Other assets (31,700) (32,300)
Accounts payable 1,194,400 314,700
Accrued liabilities (24,500) 456,500
Other liabilities 66,400
----------- -----------
Net cash provided by (used in) operating activities 905,200 (131,900)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the disposal of property,
plant & equipment 3,000
Collections on notes receivable 3,100 2,300
Capital expenditures (763,700) (1,417,900)
Acquisition of Milford (742,000)
----------- -----------
Net cash used in investing activities (757,600) (2,157,600)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in bank line of credit (759,000) 2,642,300
Proceeds from long-term obligations 458,700
Purchases of common stock (11,900)
Payments on long-term obligations (587,000) (507,600)
----------- -----------
Net cash provided from (used in) financing activities (899,200) 2,134,700
----------- -----------
NET DECREASE IN CASH AND RESTRICTED CASH (751,600) (154,800)
CASH AND RESTRICTED CASH, BEGINNING OF PERIOD 873,300 4,408,600
----------- -----------
CASH AND RESTRICTED CASH, END OF PERIOD $ 121,700 $ 4,253,800
=========== ===========
OTHER CASH FLOW INFORMATION - INTEREST PAID $ 315,200 $ 229,900
=========== ===========
<FN>
See notes to consolidated financial statements.
</TABLE>
4
<PAGE>
SECOM GENERAL CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. SUMMARY OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
General
The consolidated financial statements included herein have been
prepared by Secom General Corporation (the "Company") without audit, pursuant
to the rules and regulations of the Securities and Exchange Commission.
Certain information and footnote disclosures normally included in the
consolidated financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to
such rules and regulations, although the Company believes that the
disclosures are adequate so that the information presented is not misleading.
In the opinion of management, the financial statements as of
December 31, 1997 reflect all adjustments (normal recurring accruals) which
are necessary to present a fair statement of the results for the period then
ended. These financial statements should be read in conjunction with the
audited consolidated financial statements and notes thereto included in the
Company's 10-K for the fiscal year ended September 30, 1997.
Business
The Company is a publicly-traded holding company with five
wholly-owned subsidiaries, aligned in three business segments:
Metal Parts Forming
o Uniflow Corporation
Tooling
o Form Flow, Inc. ("Form Flow")
o L & H Die, Inc. ("L & H Die")
o Micanol, Inc. ("Micanol")
Production Machining
o Milford Manufacturing Corporation
("Milford" - acquired Nov. 1, 1996)
Principles of consolidation
The interim consolidated financial statements include the accounts
of the Company and its subsidiaries. All significant intercompany accounts
and transactions are eliminated.
Reclassifications
Certain reclassifications have been made to the prior period
balances for comparative purposes.
Inventories
Inventories are valued at the lower of cost or market. Cost is
determined by the first-in, first-out (FIFO) method.
Earnings (loss) per share
Effective for the Company's consolidated financial statements for
the quarter ended December 31, 1997, it adopted SFAS NO. 128, "Earnings per
Share," which replaces the presentation of primary earnings per share ("EPS")
and fully diluted EPS with a presentation of basic EPS and diluted EPS,
respectively.
5
<PAGE>
Basic EPS excludes dilution and is computed by dividing earnings available to
stockholders by the weighted-average number of shares outstanding for the
period. Similar to fully diluted EPS, diluted EPS assumes the issuance of
common stock for all other potentially dilutive equivalent shares
outstanding. All prior period EPS data have been restated. The adoption of
this new accounting standard did not have a material effect on the Company's
reported EPS amounts.
The Company had 313,000 shares of stock options outstanding at
December 31, 1997 at a weighted average option price of $2.19 per share.
Since the option prices were all at or above the stock's trading price as of
December 31, 1997, they had no effect on the diluted EPS calculation.
NOTE 2. INVENTORIES
Inventories at December 31, 1997 and September 30, 1997 are
summarized as follows:
<TABLE>
<CAPTION>
Dec. 31, 1997 Sept. 30, 1997
------------- --------------
<S> <C> <C>
Raw materials ...... $1,063 $1,102
Work-in-process .... 2,690 2,772
Finished goods ..... 1,954 2,263
------ ------
$5,707 $6,137
====== ======
</TABLE>
NOTE 3. ACQUISITION - MILFORD MANUFACTURING CORPORATION
Effective November 1, 1996, the Company acquired the operations,
assets and certain liabilities of Varity Kelsey-Hayes Corporation's ("VKH")
Milford, Michigan brake fluid valve parts machining operation (renamed
Milford Manufacturing Corporation). The acquisition was accounted for as a
purchase. The operations of Milford Manufacturing Corporation ("Milford") are
included in the income statement of the Company beginning November 1, 1996.
Net cash paid to the Seller, assets acquired and liabilities assumed recorded
in connection with the transaction are as follows (in thousands):
<TABLE>
<S> <C>
Liabilities assumed $3,656
Net cash paid to seller 2,295
------
Fair value of assets acquired $5,951
======
</TABLE>
Concurrent with the acquisition, the Company also entered into a
five year agreement to supply VKH with various machined brake parts. VKH paid
$1 million to the Company at closing, in lieu of a 10% product price increase
for the first year of operation, which was recorded as deferred revenue and
was amortized over the first year of operation.
NOTE 4. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment at December 31, 1997 and September 30,
1997 are summarized as follows (in thousands):
<TABLE>
<CAPTION>
Dec. 31, 1997 Sept. 30, 1997 Life
------------- -------------- ----
<S> <C> <C> <C>
Machinery and equipment ......... $ 26,954 $ 26,678 2 to 20 years
Buildings and improvements ...... 6,789 6,581 3 to 30 years
Land ............................ 897 897 n/a
Furniture and fixtures .......... 1,942 1,735 5 to 7 years
Vehicles ........................ 148 149 3 years
Construction in progress/other .. 1,395 1,334 n/a
-------- --------
Total ........................... 38,125 37,374
Accumulated depreciation ........ (10,210) (9,372)
-------- --------
Net property, plant and equipment $ 27,915 $ 28,002
======== ========
</TABLE>
6
<PAGE>
NOTE 5. LONG TERM DEBT
Long term debt principally consists of a bank revolving line of
credit (borrowing availability which is based on accounts receivable and
inventory levels), real estate mortgages, equipment term notes and industrial
revenue bonds.
NOTE 6. PENSIONS AND OTHER POSTRETIREMENT BENEFITS
The Company's Milford hourly union employees have a defined benefit
pension plan, pursuant to a collective bargaining agreement. Benefits are
based on years of service and other factors. In conjunction with the Milford
acquisition, the Seller contributed the underfunded amount over $350,000 as
of the acquisition date. Subsequent to November 1, 1996 the Company assumed
all future funding obligations related to the plan. Effective May 1997, the
Company and the Milford employees' union agreed to transfer the plan assets
to a union sponsored retirement plan and on an ongoing basis the Company
would contribute 40 cents per straight-time hour worked. The transfer is
expected to be completed in fiscal 1998 and the amount to be transferred will
be based on a valuation at a date to be mutually agreed upon. Plan assets
were $5,900 less than projected benefit obligations at September 30, 1997.
As a result of the Milford acquisition, the Company provides certain
postretirement health care and life insurance benefits to eligible Milford
employees pursuant to a collective bargaining agreement. The Company accounts
for these benefits in accordance with the provisions of SFAS No. 106,
"Employer's Accounting for Postretirement Benefits Other Than Pensions,"
which requires the accrual of such benefits during the years the employees
provide services. Effective May 1997, in conjunction with its new union
contract, the Plan was amended to eliminate spousal coverage and certain
other types of benefits to be provided. The effect of this amendment reduced
the accumulated postretirement benefit obligation by $2,350,300, which will
be amortized as an adjustment to prior service cost over the remaining
service period of the employees.
The following table sets forth the amount recorded in the
consolidated balance sheet at September 30, 1997:
<TABLE>
<S> <C>
Accumulated postretirement benefit obligation:
Active employees fully eligible for benefits $ 48,100
Other active employees 1,067,800
----------
Current retirees 1,115,900
Unrecognized prior service costs 2,280,200
----------
Accrued postretirement benefit liability $3,396,100
==========
</TABLE>
For measurement purposes, a 7% annual rate of increase in the per
capita cost of covered health care benefits was assumed for 1997, decreasing
to 5% in 1999 and thereafter.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Overview
This management's discussion and analysis of financial condition and
results of operations includes a number of forward-looking statements which
reflect the Company's current views with respect to future events and
financial performance. These forward-looking statements are subject to
certain risks and uncertainties, including those discussed below that may
cause results to differ materially from historical results or those
anticipated. In this report, the words "expects", "anticipated", "believes",
and similar expressions identify forward-looking statements, which speak only
as to the date hereof.
The Company operates in three business segments: Metal Parts
Forming, Tooling and Production Machining. The Metal Parts Forming Segment
manufactures cold forged and cold headed parts; the Tooling Segment provides
perishable tooling for the cold heading industry; and the Production
Machining Segment primarily manufactures brake components for an automotive
braking system supplier.
Although net sales for the quarter ended December 31, 1997 provided
an increase of 24% over the same quarter last year, the Company recorded a
larger net loss in the comparative period. The Company recorded a net loss of
($913,000) for the quarter ended December 31, 1997 compared to ($133,000) for
the quarter ended December 31, 1996. The increased loss was primarily due to
increased operating losses at the Uniflow and Milford units, both
experiencing lower productivity and higher costs related to manufacturing
operations. The sales increase in the current quarter primarily reflects
higher sales from the Milford unit, which had only two months of operations
in the same prior year quarter, as it was acquired by the Company effective
November 1, 1996.
The Company is studying various approaches to reduce and eliminate
the ongoing operating losses at its Uniflow and Milford subsidiaries. Plans
under consideration include the divestiture of certain equipment, the sale of
certain product lines to other manufacturers, along with reductions in
related operating personnel and other operating costs. Management expects to
implement operational changes to significantly reduce its cost structure and
improve results from operations in the quarters ending March 31 and June 30,
1998.
SEGMENT REVIEW
<TABLE>
<CAPTION>
Metal Parts Forming Segment
(in thousands)
Three Months Ended
-------------------------------------------
Dec. 31, 1997 Dec. 31. 1996
----------------- ------------------
Amount % Amount %
------ ----- ------ -----
<S> <C> <C> <C> <C>
Net sales ............ $ 4,787 100.0 $ 3,956 100.0
Gross profit ......... (292) (6.1) (201) (5.1)
Operating expenses ... 502 10.5 416 10.5
Operating loss (1) ... (794) (16.6) (617) (15.6)
<FN>
(1) Before interest, bad debt and unallocated corporate overhead expense.
</TABLE>
The Metal Parts Forming Segment, comprised of Uniflow Corporation,
manufactures metal parts from tube, bar and coil, using cold forging and cold
forming techniques. Primary parts currently manufactured are suspension ball
joint housings, transmission shafts and gear housings, truck wheel studs,
airbag housings and various other aftermarket and OEM parts.
8
<PAGE>
Uniflow's sales increased 21% in the current quarter compared to the
same period last year. The sales increase was primarily related to increased
sales of automotive starter motor shafts and transmission shafts. Management
is currently reviewing its entire sales base and the costs associated with
generating those sales. Based on this review, management will recommend
divesting products that fail to contribute to profitability, while enhancing
profitable product lines.
Uniflow recorded a negative gross margin of (6%) (as a percentage of
sales) in the current quarter, compared to negative gross margin of (5%) of
sales in the prior year comparative period. The negative gross margin in the
comparative quarters reflects higher material, direct labor and indirect
labor costs associated with the manufacture of the various parts made by
Uniflow. The labor increases were principally the result of inefficient
production, particularly in the area of cold formed production.
Management is currently reviewing reductions to its equipment base
and production facilities in order to reduce its cost of manufacturing.
Implementation of any restructuring plan will likely include the sale of
Uniflow's investment in its "FX" National 1250 cold former machine, as the
Company is currently negotiating terms of sale for the FX with prospective
buyers. Ongoing operating costs will fall dramatically by divesting of the
FX and consolidating remaining forging press and machining operations.
Operating expense was 11% (as a percentage of sales), in the
comparable quarters. Management expects operating expense to remain similar
as a percentage of sales.
<TABLE>
<CAPTION>
Tooling Segment
(in thousands)
Three Months Ended
---------------------------------------
Dec. 31, 1997 Dec. 31. 1996
---------------- ----------------
Amount % Amount %
------ ----- ------ -----
<S> <C> <C> <C> <C>
Net sales (1) .......... $4,493 100.0 $4,479 100.0
Gross profit ........... 1,105 24.6 1,206 26.9
Operating expenses ..... 514 11.4 551 12.3
Operating profit (2) ... 591 13.2 651 14.6
<FN>
(1) Includes intercompany activity
(2) Before interest, bad debt and unallocated corporate overhead expense.
</TABLE>
The Tooling Segment ("Tooling"), comprised of Form Flow, L & H Die
and Micanol, manufactures production tooling for the cold heading/forming
industry.
Tooling sales remained steady in the current quarter compared to the
same quarter last year. Overall, management believes that Tooling sales will
remain stable or increase moderately throughout the remainder of the fiscal
year.
Tooling gross profit as a percentage of sales declined slightly in
the current quarter to 25%, compared to 27% in the prior comparative
quarter. The decline was attributable to higher factory support costs
expended in the current period, primarily at the Form Flow unit.
Tooling operating expense remained relatively steady, 11% of sales
in the current quarter, compared to 12% in the prior comparative quarter.
9
<PAGE>
<TABLE>
<CAPTION>
Production Machining Segment
(In thousands)
Three Months Ended
----------------------------------------
Dec. 31, 1997 Dec. 31. 1996(3)
------------------ -----------------
Amount % Amount %
------ ----- ------ -----
<S> <C> <C> <C> <C>
Net sales (1) ................ $ 3,781 100.0 $ 1,765 100.0
Gross profit ................. 147 3.9 348 19.7
Operating expenses ........... 555 14.7 219 12.4
Operating profit (loss)(2) ... (408) (10.8) 129 7.3
<FN>
(1) Includes intercompany activity.
(2) Before interest, bad debt and unallocated corporate overhead expense.
(3) For the two months ended December 31, 1996, as Milford was acquired
November 1, 1996.
</TABLE>
The Production Machining Segment is comprised of the Company's
Milford subsidiary and it primarily machines aluminum brake fluid valve parts
used in automotive braking systems.
Sales for the three months were strong at the Milford unit, as
releases were higher on the brake valve business. Further, Milford began
shipments of machined starter motor shafts and other machined automotive
parts to new customers.
Milford's gross profit declined to 4% of sales for the current
quarter compared to 20% in the prior year quarter. The gross profit
deterioration resulted primarily from higher direct labor expense combined
with lower machine output rates. Also, critical support resources were
diverted to the start-up of a new brake valve product known as "Zwal"
(machined using a rotary dial machine and various CNC machines). The current
quarter results are inclusive of certain one-time reimbursements from
Milford's primary customer. The one-time reimbursements reduced the current
quarter operating loss by approximately $700,000.
Milford is experiencing operating losses in supplying parts to its
primary customer. The Company is negotiating with this customer to modify its
current supply arrangement in an effort to alleviate ongoing losses
associated with this business. Management anticipates a resolution to these
matters in April 1998.
Milford's gross profit was also impacted from high costs of
production associated with its starter motor shaft machining line. Milford
has experienced production difficulties and higher than anticipated direct
labor costs associated with the manufacturing of starter motor shafts.
Management is reviewing possible ways to improve the starter motor shaft
production process.
Corporate Overhead, Interest Expense and Federal Income Taxes
Unallocated corporate overhead was $302,000 in the current quarter,
compared to $233,000 in the same period of the prior year. The increase was
principally due to higher computer network system expense, higher
depreciation and amortization associated with real estate, financing fees and
other costs expensed over time.
Interest expense for the current quarter was $400,000 compared to
$252,000 in the same prior year period. The higher interest reflects
increased long-term borrowing for equipment and machinery additions made in
1996 and 1997.
10
<PAGE>
FINANCIAL CONDITION AND LIQUIDITY
Net cash provided by operating activities, before changes in working
capital items, was ($72,800) in the quarter ended December 31, 1997 compared
to $550,000 in the quarter ended December 31, 1996. In the current quarter,
working capital changes provided cash of $910,000, accounting for the cash
provided by operating activities. Accounts payable increased $1.19 million,
offset by an increase of $730,000 in accounts receivable, principally derived
from higher receivables at Milford. In the prior year quarter working capital
items used $680,000, as accounts receivable increased by $1.08 million and
inventories increased $470,000. Both of these items were primarily generated
from Milford and partially offset by increased Milford accounts payable and
other liabilities.
Net cash used in investing activities was $760,000 in the current
quarter, compared to $2.16 million in the same quarter last year. Current
quarter expenditures include a facility expansion at L&H Die, a new CNC lathe
at Form Flow, tooling and miscellaneous equipment at Uniflow, and computer
equipment applicable to all operations. In the prior year comparative
quarter, capital expenditures were primarily related machining equipment
installed at Uniflow for the production of transmission parts.
In the current quarter, net cash used in financing activities was
$900,000, which was primarily due to a net paydown of $760,000 on the
Company's revolving line of credit with a bank. Also in the current quarter,
scheduled debt payments on term notes were $590,000, while proceeds from
equipment and building loans was $460,000. In the prior year quarter, net
cash provided by financing activities was $2.13 million, of which $2.64
million was provided by increased borrowing on the Company's bank revolving
line of credit, offset by scheduled principal payments of $510,000. Cash
provided by the bank revolver was principally used to fund the Milford
acquisition, Milford working capital to fund, and progress payments on
machinery orders.
At December 31, 1997, the Company had $1.82 million available on its
bank revolving line of credit. For the foreseeable future, management
believes that continuing credit available on its bank line of credit will be
sufficient to meet the ongoing working capital needs of operating activities.
11
<PAGE>
PART II OTHER INFORMATION
Item 1. Legal Proceedings
Not applicable.
Item 2. Changes in Securities
Not applicable.
Item 3. Defaults in Securities
Not applicable.
Item 4. Submission of Matters to a Vote of Securities Holders
The Company's Annual Meeting of Stockholders is scheduled for
10:00am, March 19,1998, at the Novi Doubletree Hotel in Novi, Michigan.
Stockholders will be asked to vote on the election of the Board of Directors
and such other business as may properly come before the meeting.
Item 5. Other Information
Not applicable.
Item 6. Exhibits and Reports on Form 8-K.
Not applicable.
12
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
SECOM GENERAL CORPORATION
(Registrant)
By: /s/ Robert A. Clemente February 13, 1998
-------------------------------
Robert A. Clemente
Chairman, President and CEO
By: /s/ David J. Marczak February 13, 1998
-------------------------------
David J. Marczak
Chief Financial Officer
13
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-END> DEC-31-1997
<CASH> $ 107,700
<SECURITIES> 0
<RECEIVABLES> 6,513,400
<ALLOWANCES> (69,800)
<INVENTORY> 5,706,600
<CURRENT-ASSETS> 14,736,900
<PP&E> 38,125,400
<DEPRECIATION> (10,210,200)
<TOTAL-ASSETS> 45,706,400
<CURRENT-LIABILITIES> 9,385,300
<BONDS> 0
<COMMON> 535,500
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 13,374,900
<SALES> 12,134,800
<TOTAL-REVENUES> 12,134,800
<CGS> 10,926,900
<TOTAL-COSTS> 12,799,500
<OTHER-EXPENSES> 9,200
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 400,500
<INCOME-PRETAX> (1,074,400)
<INCOME-TAX> (161,600)
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (912,800)
<EPS-PRIMARY> (0.17)
<EPS-DILUTED> (0.17)
</TABLE>
