<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Quarterly Report Under Section 13 or 15(d) of the
Securities Exchange Act of 1934
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For Quarter Ended Commission File
March 31, 1996 Number 0-15464
RADVA CORPORATION
(Exact name of registrant as specified in its charter)
VIRGINIA 54-0715892
(State of Incorporation) (IRS Employer
Identification Number)
Drawer 2900 FSS
Radford, Virginia 24143
(Address of principal executive offices)
Registrant's telephone number, including area code (540) 639-2458
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 and (2) has been subject to such filing
requirements for the past 90 days.
Yes No X
----- -----
At May 14, 1996, there were 4,104,727 shares of Registrant's Common Stock, $.01
par value per share, outstanding.
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RADVA CORPORATION
INDEX
Page
Number
------
PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements
Balance Sheets,
December 31, 1995 and March 31, 1996 3
Statements of Operations, Three Months
Ended March 31, 1995 and March 31, 1996 4
Statements of Cash Flows, Three Months
Ended March 31, 1995 and March 31, 1996 5
Notes to Financial Statements 6-7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8
PART II. OTHER INFORMATION 9
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RADVA CORPORATION
Balance Sheets
(In Thousands)
<TABLE>
<CAPTION>
March 31 December 31
ASSETS 1996 1995
------------ -----------
<S> <C> <C>
Current assets:
Cash.................................. $ 15 $ 350
------------ ---------
Accounts and notes receivable......... 3,206 2,903
Less allowance for doubtful accounts.. 220 203
------------ ---------
Net receivables....................... 2,986 2,700
------------ ---------
Inventories:
Finished goods...................... 349 375
Work in process..................... 31 53
Raw materials and supplies.......... 250 253
Machinery inventory................. 300 283
------------ ---------
Total inventories................... 930 964
------------ ---------
Prepaid expenses...................... 98 90
Other current assets.................. 125 32
------------ ---------
Total current assets............ 4,154 4,136
------------ ---------
Property, plant & equipment, at cost..... 6,580 6,451
Less accumulated depreciation......... 4,204 4,143
------------ ---------
Net property, plant & equip..... 2,376 2,308
------------ ---------
Investment in RADOSLAV Joint Venture..... 336 336
Trademark rights......................... 277 295
Investment in Thermastructure, Ltd....... 210 210
Note receivable-noncurrent............... 414 414
Other assets............................. 294 299
------------ ---------
$ 8,061 $ 7,998
============ =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current installments of long-term debt $ 243 $ 242
Notes payable......................... 134 --
Accounts payable...................... 1,230 1,267
Accrued expenses...................... 486 466
Income taxes payable.................. 10 10
------------ ---------
Total current liabilities...... 2,103 1,985
------------ ---------
Long-term debt, excluding current
installments.......................... 2,774 2,834
Stockholders' equity:
Common stock of $.01 par value.
Authorized 10,000,000 shares; issued
and outstanding 4,104,727.......... 41 41
Additional paid-in capital............ 4,512 4,512
Retained earnings..................... (1,369) (1,374)
------------ ---------
Total stockholders' equity... 3,184 3,179
------------ ---------
$ 8,061 $ 7,998
============ =========
</TABLE>
See accompanying notes to financial statements.
3
<PAGE> 4
RADVA CORPORATION
Statements of Operations
Three Months Ended March 31
(In Thousands, except per share data)
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
Net Revenues:
Manufacturing net revenues......... $ 2,622 $ 2,562
Licensing & machinery sales........ - 179
-------- --------
Net revenues....................... 2,622 2,741
-------- --------
Cost and expenses:
Cost of sales...................... 1,994 1,981
Shipping and selling............... 225 290
General and administrative......... 329 372
Research and development........... 3 11
2,551 2,654
-------- --------
Operating income (loss)............ 71 87
-------- --------
Other income (deductions):
Interest expense................... (73) (77)
Other.............................. 6 6
-------- --------
(67) (71)
-------- --------
Earnings before income taxes.......... 4 16
Income tax expense.................... - -
-------- --------
Net earning (loss).................... $ 4 $ 16
======== ========
Earnings (loss) per common share...... $ .00 $ .00
======== ========
</TABLE>
See accompanying notes to financial statements.
4
<PAGE> 5
RADVA CORPORATION
Statements of Cash Flows
Quarters Ended March 31
(In Thousands)
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income........................................... $ 4 $ 16
------- --------
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation..................................... 65 96
Amortization..................................... 21 20
Change in assets and liabilities:
(Gain) or loss on sale of equipment ............ - (142)
Decrease (Increase) in net receivables.......... (286) 440
Decrease (Increase) in inventories.............. 34 (291)
Decrease (Increase) in prepaid expenses......... (8) 2
Increase in other current assets................ (93) (9)
Decrease (Increase) in other assets............. 3 (7)
Increase (Decrease) in cash overdrafts ......... - 69
Increase (Decrease) in accounts payable......... (37) (370)
Increase (Decrease) in accrued expenses......... 20 38
------- --------
Total adjustments......................... (281) (154)
------- --------
Net cash from operating activities..... (277) (138)
------- --------
Cash flows from investing activities:
Proceeds from sale of equipment...................... - 179
Capital expenditures for equipment and other
long-term assets.................................. (133) (45)
------- --------
Net cash from investing activities..... (133) 134
------- --------
Cash flows from financing activities:
Proceeds from notes payable.......................... 134 -
Principal payments under notes payable............... - (54)
Proceeds from long-term debt......................... - -
Principal payments under long-term debt.............. (59) (97)
------- --------
Net cash from financing activities..... 75 (151)
------- --------
Net increase (decrease) in cash......................... (335) (155)
Cash at January 1....................................... 350 189
------- --------
Cash at March 31........................................ $ 15 $ 34
======= ========
</TABLE>
See accompanying notes to financial statements.
5
<PAGE> 6
RADVA CORPORATION
Notes to Financial Statements
March 31, 1996
(1) General
The financial statements conform to generally accepted accounting principles
and to general industry practices. The financial statements are unaudited.
However, in the opinion of management, all adjustments which are normal and
necessary for a fair presentation of the financial statements have been
included.
(2) Property, Plant and Equipment
A summary of property, plant and equipment follows:
<TABLE>
<S> <C>
Land and improvements............................. $ 225,983
Buildings and improvements........................ 2,033,609
Machinery and equipment........................... 3,463,341
Transportation equipment.......................... 416,374
Office equipment.................................. 440,719
----------
$6,580,026
==========
</TABLE>
(3) Accrued Expenses
Accrued expenses are comprised of the following:
<TABLE>
<S> <C>
Payroll and employment benefits................... $ 159,563
Interest.......................................... 16,751
Other............................................. 310,077
----------
$ 486,391
==========
</TABLE>
(4) Notes Payable
<TABLE>
<S> <C>
Demand note, collateralized by certain
accounts receivable and inventory.
Interest at prime plus 2%......................... $ 133,833
----------
$ 133,833
==========
</TABLE>
6
<PAGE> 7
RADVA CORPORATION
Notes to Financial Statements
March 31, 1996
(5) Long-term Debt
A summary of long-term debt follows:
<TABLE>
<S> <C>
Installment note payable to bank, due in monthly installments of
$43,467, including interest at prime plus 2%
$ 2,950,016
Installment notes payable with various maturities, collateralized
by equipment. Interest rates ranging from 7.25% to 12.50%
30,285
Installment note payable to bank, due in monthly installments of
31,225 Austrian shillings, including interest at 12%
6,834
Installment note payable due in monthly installments of $279,
including interest at 8.125% with a final balloon payment in
August 1998, collateralized by a deed of trust on certain real
estate.
31,104
-------------
Total long-term debt 3,018,239
Less current installments of long-term debt 243,281
-------------
Long-term debt, excluding current installments $ 2,774,958
=============
</TABLE>
7
<PAGE> 8
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Net earnings were down moderately in the first quarter of 1996 as compared to
the first quarter of 1995. The reduction was $12,000, from $16,000 in the
first quarter of 1995 to $4,000 in the first quarter of 1996. The reduction
was primarily caused by the Company recording no license or machinery sales in
the first quarter of 1996 after having recorded $188,000 of such sales in the
first quarter of 1995, resulting in profits of $103,000.
No particular significance should be given to this absence of license or
machinery sales in the first quarter of 1996 since these sales tend to occur
unevenly in no predictable pattern. The loss of the income from the absence of
these sales was largely offset by the sale of the door core license in 1995 and
the termination of the door core operation. The company lost $79,000 on door
core sales in the first quarter of 1995, but had no such losses in 1996.
Cost of sales, as a percentage of manufacturing net revenues and after having
eliminated $45,000 of cost associated with the sale of machinery, increased
from 75.5% for the first quarter of 1995 to 76.0% for the first quarter of
1996.
Shipping and selling expenses, as a percentage of manufacturing net revenues,
decreased 2.7% from 11.3% for the first quarter of 1995 to 8.6% for the first
quarter of 1996. This reduction was primarily the result of cost cutting
measures at the Radford, Virginia shape molding plant.
General and administration expenses decreased $43,000. These reductions are
primarily attributable to reductions in the cost of corporate services.
Travel, bank charges, salaries, and other items decreased by $12,000; $13,000;
$5,000 and $10,000, respectively.
LIQUIDITY AND CAPITAL RESOURCES
The Company earned net profits of $482,000, $524,000, $93,000, $514,000, and
$223,000 in 1995, 1994, 1993, 1992, and 1991, respectively. The Company
obtained a major refinancing package in 1995 which significantly improved its
working capital position from a negative $865,000 at December 31, 1994, to a
positive working capital of $2,045,000 at March 31, 1996. This financing
package consisted of a $3,000,000 term loan and a $500,000 credit line which
had $366,167 available at March 31, 1996.
The Company owns a 31% interest in a joint venture in Russia which calls for a
distribution of profits in hard currency when available. However, should hard
currency not be available, profit distributions will be effected through
commodity transfers and bartering arrangements. These arrangements may be
facilitated by a regional commodity exchange in Russia with which Radva
Corporation is affiliated.
8
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PART II: OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
See item 3 of the Company's Form 10-K for the fiscal year ended
December 31, 1995.
Item 2. CHANGES IN SECURITIES
Not applicable.
Item 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
Not applicable.
Item 5. OTHER INFORMATION
Not applicable.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
27 Financial Data Schedule
Pursuant to the requirements of the Securities Exchange Act of
1934,this form 10-Q has been signed on behalf of the
Registrant by its Assistant Secretary/Treasurer who is
authorized to sign on behalf of the Registrant.
RADVA CORPORATION
WILLIAM F. FRY
-----------------------------
William F. Fry
Assistant Secretary/Treasurer
May 14, 1996
9
<PAGE> 10
EXIHIBT INDEX
<TABLE>
<CAPTION>
Exhibit
No. Description
- ------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary fnancial information extracted from balance sheet
as of March 31, 1996 and Statement of Operations for the three months
then ended.
</LEGEND>
<CIK> 0000792984
<NAME> RADVA CORPORATION
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 15
<SECURITIES> 0
<RECEIVABLES> 3,206
<ALLOWANCES> 220
<INVENTORY> 930
<CURRENT-ASSETS> 4,154
<PP&E> 6,580
<DEPRECIATION> 4,204
<TOTAL-ASSETS> 8,061
<CURRENT-LIABILITIES> 2,103
<BONDS> 2,774
<COMMON> 41
0
0
<OTHER-SE> 3,143
<TOTAL-LIABILITY-AND-EQUITY> 8,061
<SALES> 2,622
<TOTAL-REVENUES> 2,622
<CGS> 1,994
<TOTAL-COSTS> 2,551
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 73
<INCOME-PRETAX> 4
<INCOME-TAX> 0
<INCOME-CONTINUING> 4
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4
<EPS-PRIMARY> .00
<EPS-DILUTED> .00
</TABLE>
