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 Quarter Ended . . April 6, 1997 . . Commission file number . . . 1-.2451
. . . . . . . . . . . NATIONAL PRESTO INDUSTRIES, INC. . . . . . . . . . .
(Exact name of registrant as specified in its charter)
. . . . WISCONSIN . . . . . . . . . . . . . . . . . . . . . 39-0494170 . . .
(State or other jurisdiction of. (I.R.S. Employer
incorporation or organization) Identification No.)
3925 NORTH HASTINGS WAY
. . . . EAU CLAIRE, WISCONSIN . . . . . . . . . . . . . . . 54703-3703 . .
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code . . . . 715-839-2121 . .
There were 7,354,097 shares of the Issuer's Common Stock outstanding as
of the close of the period covered by this report.
* 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 . . .
<TABLE>
<CAPTION>
NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
April 6, 1997 and December 31, 1996
(Unaudited)
(Dollars in thousands)
1997 1996
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 86,086 $ 91,878
Marketable securities 134,736 136,159
Accounts receivable, net 10,357 21,826
Inventories:
Finished goods $ 7,437 $ 8,470
Work in process 2,071 1,744
Raw materials 5,072 6,661
Supplies 1,277 15,857 945 17,820
--------------- ----------------
Prepaid expenses 925 888
----------------- -----------------
Total current assets 247,961 268,571
PROPERTY, PLANT AND EQUIPMENT: 17,459 17,256
Less allowance for depreciation 10,367 7,092 9,911 7,345
--------------- ----------------
OTHER ASSETS 9,469 9,469
================= =================
$264,522 $285,385
================= =================
The accompanying notes are an integral part of the financial statements.
</TABLE>
<TABLE>
<CAPTION>
NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
April 6, 1997 and December 31, 1996
(Unaudited)
(Dollars in thousands)
1997 1996
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
LIABILITIES
CURRENT LIABILITIES:
Accounts payable $ 7,523 $ 13,262
Federal and state income taxes 2,413 4,887
Accrued liabilities 19,828 20,387
----------------- -----------------
Total current liabilities 29,764 38,536
COMMITMENTS AND CONTINGENCIES - -
STOCKHOLDERS' EQUITY
Common stock, $1 par value:
Authorized: 12,000,000 shares
Issued: 7,440,518 shares $ 7,441 $ 7,441
Paid-in capital 912 903
Retained earnings 228,688 240,815
--------------- ----------------
237,041 249,159
Treasury stock, at cost 2,283 2,310
--------------- ----------------
Total stockholders' equity 234,758 246,849
================= =================
$264,522 $285,385
================= =================
</TABLE>
The accompanying notes are an integral part of the financial statements.
<TABLE>
<CAPTION>
NATIONAL PRESTO INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF EARNINGS
Three Months ended April 6, 1997 and March 31, 1996
(Unaudited)
(In thousands except per share data) THREE MONTHS ENDED
------------------
1997 1996
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Net sales $17,947 $ 17,109
Cost of sales 14,016 13,472
--------------- -----------------
Gross profit 3,931 3,637
Selling and general expenses 4,231 4,274
--------------- -----------------
Operating loss (300) (637)
Other income, principally interest 2,555 2,057
Other, principally litgation judgments / settlements 550 476
--------------- -----------------
Earnings before provision for income taxes 2,805 1,896
Provision for income taxes 226 (34)
--------------- -----------------
Net earnings $ 2,579 $ 1,930
=============== =================
Weighted average common shares outstanding 7353 7,351
=============== =================
Net earnings per common share $ 0.35 $ 0.26
=============== =================
Cash dividends declared and paid per common share $ 2.00 $ 2.00
=============== =================
</TABLE>
The accompanying notes are an integral part of the financial statements.
<TABLE>
<CAPTION>
NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months ended April 6, 1997 and March 31, 1996
(Unaudited)
(Dollars in thousands)
1997 1996
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 2,579 $ 1,930
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Provision for depreciation 468 420
Stock compensation expense 16 14
Changes in:
Accounts receivable 11,469 17,577
Inventories 1,963 297
Prepaid expenses (37) 308
Accounts payable and accrued liabilities (6,298) (6,570)
Federal and state income taxes (2,474) (4,312)
----------------- -----------------
Net cash provided by operating activities 7,686 9,664
----------------- -----------------
Cash flows from investing activities:
Marketable securities purchased (17,341) (26,465)
Marketable securities - maturities and sales 18,764 26,620
Acquisition of property, plant and equipment (217) (1,287)
Change in other assets 2 3
----------------- -----------------
Net cash used in investing activities 1,208 (1,129)
----------------- -----------------
Cash flows from financing activities:
Dividends paid (14,706) (14,701)
Other 20 26
----------------- -----------------
Net cash used in financing activities (14,686) (14,675)
----------------- -----------------
Net decrease in cash and cash equivalents (5,792) (6,140)
Cash and cash equivalents at beginning of period 91,878 91,448
================= =================
Cash and cash equivalents at end of period $ 86,086 $ 85,308
================= =================
</TABLE>
The accompanying notes are an integral part of the financial statements.
NATIONAL PRESTO INDUSTRIES, INC., AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A - EARNINGS PER SHARE
Earnings per share are computed using the weighted average common shares
outstanding during each period.
NOTE B - NEW ACCOUNTING PRONOUNCEMENT
The FASB has issued Statement of Financial Accounting Standards No. 128,
EARNINGS PER SHARE, which is effective for financial statements issued after
December 15, 1997. Early adoption of the new standard is not permitted. The new
standard eliminates primary and fully diluted earnings per share and requires
presentation of basic and diluted earnings per share together with disclosure of
how the per share amounts were computed. The adoption of this new standard is
not expected to have a material impact on the disclosure of earnings per share
in the financial statements.
- ------------------------------------------------------------------------
The foregoing information for the periods ended April 6, 1997, and March 31,
1996, is unaudited; however, in the opinion of management of the Registrant, it
reflects all the adjustments, which were of a normal recurring nature, necessary
for a fair statement of the results for the interim periods. The condensed
consolidated balance sheet as of December 31, 1996, is summarized from audited
consolidated financial statements, but does not include all the disclosures
contained therein and should be read in conjunction with the 1996 Annual Report.
Interim results for the period are not indicative of those for the year.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Comparison First Quarter 1997 and 1996
Net sales increased by $839,000 from $17,109,000 to $17,948,000,
primarily due to higher volume.
Gross margins as a percentage of sales increased from 21% to 22%,
primarily as a result of more favorable manufacturing variances offset in part
by a less favorable product mix.
The Company accrues unexpended advertising costs budgeted for the year
against each quarter's sales. Major advertising commitments are incurred in
advance of the expenditures, and the timing of sales through dealers and
distributors to the ultimate customer does not permit specific identification of
the customers' purchase to the actual time an advertisement appears. Advertising
charges included in selling expense in each quarter represent that percentage of
the annual advertising budget associated with that quarter's shipments.
Revisions to this budget result in periodic changes to the accrued liability for
committed advertising expenditures.
Other income, principally interest increased from the 1996 level
primarily as a result of a higher rate of return on a higher level of invested
funds. Both years were favorably impacted by litigation judgments/settlements of
a non-recurring nature.
Earnings before provision for income taxes increased $909,000 from
$1,896,000 to $2,805,000. The provision for income taxes increased from
($34,000) to $226,000 and the effective income tax rate increased from (2%) to
8%, as a result of increased earnings subject to tax. Net earnings increased
$649,000 from $1,930,000 to $2,579,000, or 34%.
The Company maintains adequate liquidity for all of its anticipated
capital requirements. As of quarter-end, there were no material capital
commitments outstanding.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K:
None
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.
____NATIONAL PRESTO INDUSTRIES, INC.___
Date: May 9, 1997 ____________________________/S/ M. J. COHEN
M. J. Cohen, President
Date: May 9, 1997 ____________________________/S/ R. F. LIEBLE
R. F. Lieble, Treasurer
(Principal accounting officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED FINANCIAL
STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> APR-06-1997
<CASH> 86,086
<SECURITIES> 134,736
<RECEIVABLES> 10,357
<ALLOWANCES> 0
<INVENTORY> 15,857
<CURRENT-ASSETS> 247,961
<PP&E> 17,459
<DEPRECIATION> 10,367
<TOTAL-ASSETS> 264,522
<CURRENT-LIABILITIES> 29,764
<BONDS> 0
0
0
<COMMON> 7,441
<OTHER-SE> 227,317
<TOTAL-LIABILITY-AND-EQUITY> 264,522
<SALES> 17,947
<TOTAL-REVENUES> 17,947
<CGS> 14,016
<TOTAL-COSTS> 14,016
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 2,805
<INCOME-TAX> 226
<INCOME-CONTINUING> 2,579
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,579
<EPS-PRIMARY> .35
<EPS-DILUTED> 0
</TABLE>
