<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 quarterly period ended: September 30, 1995
Commission File number: 1-9429
ROTONICS MANUFACTURING INC.
(Exact name of registrant as specified in its charter)
DELAWARE 36-2467474
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
17022 SOUTH FIGUEROA STREET, GARDENA, CALIFORNIA 90248
(Address of principal executive offices) (Zip Code)
(310) 538-4932
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year,
if changed since last 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
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at September 30, 1995
----- ---------------------------------
Common Shares 14,155,402 Shares
($.01 stated value)
Total Pages 15
Exhibit Index at Page 14
<PAGE> 2
ROTONICS MANUFACTURING INC.
INDEX
<TABLE>
<CAPTION>
Page Number
-----------
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1 - Financial Statements
Balance Sheets -
September 30, 1995 (Unaudited)
and June 30, 1995 (Audited) 3
Statements of Income and
Accumulated Deficit -
Three Months Ended September 30, 1995
and 1994 (Unaudited) 4
Statements of Cash Flows -
Three Months Ended September 30, 1995
and 1994 (Unaudited) 5
Notes to Financial Statements 6
Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of Operations 10
PART II. OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K 12
SIGNATURES 13
</TABLE>
2
<PAGE> 3
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
ROTONICS MANUFACTURING INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, June 30,
1995 1995
------------- -----------
(Unaudited) (Audited)
<S> <C> <C>
ASSETS
Current assets:
Cash $ 15,600 $ 96,700
Accounts receivable, net (Notes 5 and 6) 4,392,400 5,341,500
Notes receivable 115,600 110,900
Inventories (Notes 2, 5 and 6) 5,235,600 5,352,100
Deferred income taxes, net (Note 9) 1,050,000 887,200
Prepaid expenses and other current assets 240,900 114,800
----------- -----------
Total current assets 11,050,100 11,903,200
Notes receivable, less current portion 391,700 396,800
Deferred income taxes, net (Note 9) 3,482,000 3,658,100
Property, plant and equipment, net (Notes 3, 5 and 6) 8,423,200 8,605,900
Intangible assets, net (Note 4) 5,616,000 5,692,700
Other assets 96,100 102,700
----------- -----------
$29,059,100 $30,359,400
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt (Note 6) $ 908,100 $ 1,034,500
Current portion of long-term debt due related parties 90,000 140,000
Accounts payable 1,911,300 2,357,100
Accrued liabilities (Note 7) 971,700 1,211,000
Income taxes payable (Note 9) - 23,400
----------- -----------
Total current liabilities 3,881,100 4,766,000
Bank Line of credit (Note 5) 2,930,100 3,060,300
Long-term debt, less current portion (Note 6) 4,357,300 4,624,900
Long-term debt due related parties, less current portion 22,500 22,500
Deferred pension liabilities 4,000 4,000
----------- -----------
Total liabilities 11,195,000 12,477,700
----------- -----------
Stockholders' equity:
Preferred stock, stated value $.01, redemption value $1: authorized
4,250,000 shares; issued and outstanding zero and 3,000,000 shares,
respectively (Note 8) - 3,000,000
Common stock, stated value $.01: authorized 20,000,000 shares;
issued and outstanding 14,153,623 and 12,903,752 shares, respectively,
net of treasury shares (Note 8) 24,574,000 21,980,500
Accumulated deficit (6,709,900) (7,098,800)
----------- -----------
Total stockholders' equity 17,864,100 17,881,700
----------- -----------
$29,059,100 $30,359,400
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE> 4
ROTONICS MANUFACTURING INC.
STATEMENTS OF INCOME AND ACCUMULATED DEFICIT
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
September 30,
--------------------------------
1995 1994
------------ ------------
<S> <C> <C>
Net sales $ 8,981,900 $ 9,079,200
----------- ------------
Costs and expenses:
Cost of goods sold 6,798,000 6,595,200
Selling, general and administrative expenses 1,542,900 1,436,900
----------- ------------
Total costs and expenses 8,340,900 8,032,100
----------- ------------
Income from operations 641,000 1,047,100
----------- ------------
Other (expense)/income:
Interest expense (191,000) (152,000)
Other income 48,900 9,700
----------- ------------
Total other expense (142,100) (142,300)
----------- ------------
Income before income taxes 498,900 904,800
Income tax provision (Note 9) (48,000) (59,400)
----------- ------------
Net income 450,900 845,400
Accumulated deficit, beginning of period (7,098,800) (10,084,800)
Preferred stock dividends (62,000) (81,300)
----------- ------------
Accumulated deficit, end of period $(6,709,900 $ (9,320,700)
=========== ============
Income per common share (Note 10):
Net income:
Primary $.03 $.06
======= ========
Fully diluted $.03 $.06
======= ========
Weighted average number of common and common equivalent shares outstanding:
Primary 12,902,708 12,304,183
========== ==========
Fully diluted 12,903,893 12,304,934
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE> 5
ROTONICS MANUFACTURING INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
September 30,
----------------------------
1995 1994
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 450,900 $ 845,400
Adjustments to reconcile net income to net cash provided
by/(used in) operating activities:
Depreciation and amortization 398,900 346,100
Deferred income tax provision 13,300 24,500
Provision for doubtful accounts 21,700 21,500
Changes in assets and liabilities:
Decrease/(increase) in accounts receivable 927,400 (86,300)
Decrease/(increase) in inventories 116,500 (388,600)
(Increase)/decrease in prepaid expenses and other current assets (126,100) 83,800
Decrease/(increase) in other assets 4,000 (2,900)
(Decrease)/increase in accounts payable (445,800) 389,000
Decrease in accrued liabilities (215,900) (29,500)
Decrease in income taxes payable (23,400) (32,500)
----------- -----------
Net cash provided by operating activities 1,121,500 1,170,500
----------- -----------
Cash flows from investing activities:
Repayments on notes receivable, net 400 6,000
Capital expenditures (136,900) (2,039,400)
----------- -----------
Net cash used in investing activities (136,500) (2,033,400)
----------- -----------
Cash flows from financing activities:
Net repayments under line of credit (130,200) (78,800)
Proceeds from issuance of long-term debt - 1,330,000
Repayment of long-term debt (444,000) (278,900)
Redemption of preferred stock (250,200 -
Payment of preferred stock dividends (85,400) (85,500)
Purchase of treasury stock (156,300) -
----------- -----------
Net cash (used in)/provided by financing activities (1,066,100) 886,800
----------- -----------
Net (decrease)/increase in cash (81,100) 23,900
Cash at beginning of period 96,700 2,600
----------- -----------
Cash at end of period $ 15,600 $ 26,500
=========== ===========
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 197,200 $ 158,300
=========== ===========
Income taxes $ 86,500 $ 74,100
=========== ===========
Supplemental schedule of noncash financing activities:
Conversion of preferred stock to common stock $ 2,749,800 $ 500,000
=========== ===========
Preferred dividends declared but not paid $ - $ 25,300
=========== ===========
</TABLE>
5
<PAGE> 6
The accompanying notes are an integral part of these financial statements.
ROTONICS MANUFACTURING INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1-INTERIM REPORTING:
The interim financial information included herein is unaudited. This
information reflects all adjustments (consisting solely of normal recurring
adjustments) which are, in the opinion of management, necessary for a fair
statement of operating results for the interim periods. This interim financial
information should be read in conjunction with the Rotonics Manufacturing Inc.
("the Company") Annual Report as filed on Form 10-K for the fiscal year ended
June 30, 1995.
NOTE 2 - INVENTORIES:
Inventories consist of:
<TABLE>
<CAPTION>
September 30, June 30,
1995 1995
------------- ----------
<S> <C> <C>
Raw materials $2,675,300 $3,059,000
Finished goods 2,560,300 2,293,100
---------- ----------
$5,235,600 $5,352,100
========== ==========
</TABLE>
NOTE 3 - PROPERTY, PLANT AND EQUIPMENT:
Property, plant and equipment consist of:
<TABLE>
<CAPTION>
September 30, June 30,
1995 1995
------------- -----------
<S> <C> <C>
Land $ 574,200 574,200
Buildings and building improvements 2,558,100 2,486,800
Machinery, equipment, furniture and fixtures 10,756,800 10,635,100
Construction in progress 63,300 120,200
----------- -----------
13,952,400 13,816,300
Less - accumulated depreciation (5,529,200) (5,210,400)
----------- -----------
$ 8,423,200 $ 8,605,900
=========== ===========
</TABLE>
NOTE 4 - INTANGIBLE ASSETS:
Intangible assets consist of:
<TABLE>
<CAPTION> September 30, June 30,
1995 1995
------------ -----------
<S> <C> <C>
Patents, net of accumulated amortization of $75,200 and $73,700 $ 58,100 $ 59,600
Goodwill, net of accumulated amortization
of $1,543,100 and $1,467,900 5,557,900 5,633,100
----------- ----------
$ 5,616,000 $5,692,700
=========== ==========
</TABLE>
6
<PAGE> 7
NOTE 5 - BANK LINE OF CREDIT:
The Company has a $5,000,000 revolving line of credit with Wells Fargo Bank.
The line matures May 16, 1997 and is secured by the Company's machinery and
equipment, accounts receivable and inventories. Interest is payable monthly at
the bank's prime rate. The bank's prime rate at September 30, 1995 was 8.75%
per annum. The loan agreement allows the Company to convert the outstanding
principal balance in increments of $250,000 to a LIBOR-based loan for periods
up to 90 days. At September 30, 1995 the Company had $2,750,000 borrowed under
the LIBOR option bearing interest at 8.38% per annum and maturing on November
28, 1995. Proceeds from the loan were used for working capital purposes. At
September 30, 1995 the Company had approximately $2,070,000 available for
future borrowings under the revolving line of credit.
NOTE 6 - LONG-TERM DEBT:
Long-term debt consists of:
<TABLE>
<CAPTION>
September 30, June 30,
1995 1995
------------- ------------
<S> <C> <C>
Unsecured note payable (A) $ - $ 93,800
Note payable - Bank (B) 3,733,300 3,933,300
Note payable - Bank (C) 212,800 217,400
Note payable - Bank (D) 1,263,500 1,280,100
Other 55,800 134,800
----------- -----------
5,265,400 5,659,400
Less current portion (908,100) (1,034,500)
---------- -----------
$4,357,300 $ 4,624,900
========== ==========
</TABLE>
(A) This note was issued in connection with the settlement of the Garney
Companies, Inc.("Garney") lawsuit on December 11, 1992. The settlement
requires payments to Garney amounting to $400,000, of which $150,000 was
paid in December 1992. The remaining $250,000 was due in quarterly
principal installments of $15,600 plus interest at April 1, 1993. In
August 1995 the note was repaid in full net of a $8,000 discount for
early extinguishment.
(B) In May 1995 the Company restructured its credit agreement with Wells Fargo
Bank. The loan consists of a $4,000,000 sixty-month term loan. The note
is due in monthly principal installments of $66,700 plus interest at the
bank's prime rate (8.75% at September 30, 1995). In addition, the loan
agreement allows the Company to convert all or a portion of the outstanding
principal in increments of $250,000 to a LIBOR-based loan for periods up to
180 days. At September 30, 1995 the Company had $3,500,000 of the
outstanding principal balance under the LIBOR option at 8.38% per annum.
The note is secured by the Company's machinery and equipment, accounts
receivable and inventories and matures on May 16, 2000.
(C) This note was issued to the First State bank of Gainesville in the original
amount of $250,000. The loan is due in monthly installments of
approximately $3,000 including interest at 8% per annum beginning September
1993 and continuing for 36 months, at which time the entire balance of
unpaid principal plus accrued interest is due and payable. The note is
secured by a deed of trust on the Company's real property in Gainesville,
Texas. Proceeds from the loan were used for working capital purposes and to
finance the majority of a fixed asset expansion project at the Company's
Idaho facility.
(D) This note was issued to Wells Fargo Bank on September 15, 1994 in
connection with the purchase of real property in Bensenville, Illinois.
The note is due in monthly principal installments of approximately $5,500
plus interest at the bank's prime rate (8.75% per annum at September 30,
1995) on a twenty-year amortization with the outstanding principal due in
five years. The note is secured by a first trust deed on the real property
and matures September 15, 1999.
7
<PAGE> 8
NOTE 7 - ACCRUED LIABILITIES:
Accrued liabilities consist of:
<TABLE>
<CAPTION>
September 30, June 30,
1995 1995
------------- ----------
<S> <C> <C>
Salaries, wages, commissions and related payables $805,600 $ 980,400
Other 166,100 230,600
-------- ----------
$971,700 $1,211,000
======== ==========
</TABLE>
NOTE 8 - PREFERRED STOCK AND COMMON STOCK:
in September 1995, the company redeemed 250,232 shares of its preferred stock
at the stated redemption value of $1. Subsequent to the redemptions, in
accordance with unanimous approval of the Board of Directors, the Company
converted the remaining 2,749,768 shares of the outstanding series A preferred
stock to 1,374,884 shares of the Company's common stock. The shares were
converted on the basis of one share of common stock issued for every two shares
of preferred stock outstanding. The fair market value of the Company's common
stock on the date of conversion was $2.4375.
NOTE 9 - INCOME TAXES:
The components of the income tax provision were:
<TABLE>
<CAPTION>
For the three months ended
September 30,
--------------------------
1995 1994
------- -------
<S> <C> <C>
Current:
Federal $ 5,300 $ 9,500
State 29,400 25,400
------- -------
34,700 4,900
------- -------
Deferred:
Federal - 4,800
State 13,300 19,700
------- -------
13,300 24,500
------- -------
$48,000 $59,400
======= =======
</TABLE>
At September 30, 1995, the Company had net operating loss (NOL) carryforwards
of approximately $16,600,000 and $2,600,000, respectively, for federal and
state income tax purposes expiring in varying amounts through 2006. The NOL
carryforwards, which are available to offset future profits of the Company and
are subject to limitations should a "change in ownership" as defined in the
Internal Revenue Code occur, will begin to expire in 1998 and 1995 for federal
and state tax purposes, respectively, if not utilized.
In conjunction with the adoption of Statement of Financial Accounting Standards
No. 109 (FAS 109) "Accounting for Income Taxes", management determined the
future taxable income of the Company will more likely than not be sufficient to
realize the tax benefits of its NOL's. As such, an initial deferred tax asset
of $4,013,000, net of a valuation allowance of $2,662,000 was recorded.
Based on the operating results since the adoption of FAS 109 and management's
continuing assessment, management believes that the Company will continue to
utilize its NOLs on a go-forward basis. As such, through September 30, 1995
management has reduced the initial valuation allowance by $2,234,500. For the
three months ended September 30, 1995 and 1994, the Company recorded
adjustments to the valuation allowance amounting to $162,800 and $209,100,
respectively. At September 30, 1995 the combined federal and state valuation
allowance was $427,500. Management anticipates depleting the remaining
valuation allowance during fiscal 1996. Once the valuation allowance is
depleted the Company will begin to realize a higher effective income tax
rate. The adjustments to the valuation allowance have been reflected as
a component of the respective period's income tax provision.
8
<PAGE> 9
NOTE 10 - COMPUTATION OF EARNINGS PER SHARE:
Primary and fully diluted earnings per share have been computed in accordance
with APB No. 15 "Earnings per Share", using the treasury stock method for
applicable common stock warrants and options. Net income was reduced by the
appropriate amount of preferred stock dividends to determine earnings
applicable to common stock.
9
<PAGE> 10
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations - Three Months Ended September 30, 1995 and 1994
Net sales for the three months ended September 30, 1995 decreased by $97,300,
or 1.1% to $8,981,900 compared to $9,079,200 for the same period last year.
Overall the decrease is minimal and management is satisfied with its ability to
sustain relatively consistent sales volumes in relation to a realized softening
in the marketplace. Since fiscal 1995 the Company has had to institute several
general price increases to minimize the effect of unprecedented increases in
plastic resin costs. These factors have produced a sluggish marketplace as our
customer base adjusts to the current pricing structure. The Company's west
coast operations have faired the best maintaining consistent volumes
facilitated by substantial refuse container orders; while the midwest
operations have reported the largest sales volume impact (approximately
$1,000,000) reflecting reductions in the majority of their respective
proprietary product lines. Management has taken a proactive approach to
improve sales volumes in future periods as it concentrates on strengthening
customer relations and building market share for its proprietary products. To
build sales momentum the Company has restructured and increased its
sales/marketing work force during the last quarter.
Cost of goods sold increased 3.1% to 75.7% of net sales for the three months
ended September 30, 1995 compared to 72.6% for the same period last year. As
previously mentioned, the Company has experienced significant plastic resin
cost increases during fiscal 1995. During fiscal 1995 the Company effectively
absorbed these costs through raw material purchasing strategies and sales
price increases. Although the Company did institute several general price
increases to compensate for the increases in resin costs, due to market
resistance the Company could not increase its pricing enough to stay in step on
an equal basis. As such, lackluster sales during the quarter ended September
30, 1995 combined with realizing the full impact of these resin price increases
has negatively impacted the Company's gross margin. Another key element was
the change in the Company's overall product mix during the quarter ended
September 30, 1995. The Company reported a larger proportionate share of
refuse container sales during the current period. Historically sales of refuse
containers is very competitive and thus yield lower gross margins. Again,
management has taken a proactive stance to improve margins which should in turn
improve performance during the remaining portion of fiscal 1996. Management
intends to increase productivity and lower its manufacturing costs through
plant consolidation and continuing to implement plans to streamline its
operations. In addition, the Company should benefit in future periods if
recent reductions in resin prices hold.
Selling, general and administrative expenses were $1,542,900, or 17.2% of net
sales for the three months ended September 30, 1995 compared with $1,436,900,
or 15.8% for the same period last year. The increase is primarily attributed
to $160,000 in additional expenses incurred associated with the Company's
Arleta, California facility which was acquired during the fourth quarter of
fiscal 1995 coupled with slightly lower sales volumes during the current
period.
Total interest expense increased $39,000 to $191,000 for the three months ended
September 30, 1995 compared to $152,000 for the same period last year. The
increase is attributed to the debt associated with the purchased of the
Bensenville, Illinois property in September 1994 and the repayment of debt
assumed (approximately $700,000) in connection with the purchases of the
Arleta, California facility. In addition the Company's average prime lending
rate charged on its bank facility was approximately .5% higher than it was
during the same period last year. Based on recent renegotiated interest rates
on its bank facility, continued repayment of its bank and shareholder debt, the
payoff of the Garney Construction note during July 1995, the elimination of
future preferred stock redemptions and 9% dividend payments, and a recent
reduction in the bank prime lending rate, management anticipates realizing
overall lower interest costs on its current debt structure during the remaining
portion of fiscal year 1996.
Net income was $450,900, or $.03 per common share for the three months ended
September 30, 1995 compared to $845,400, or $.06 per common share for the same
period last year. The decrease is attributed to lower sales volumes due to a
sluggish marketplace, an increase in plastic resin costs which has lowered
gross margins, additional selling, general and administrative expenses
associated with the Arleta, California division and an increase in interest
costs as previously outlined above. Again management plans to continue its
efforts to improve sales volumes and control manufacturing and overhead costs
which should improve our performance during the balance of fiscal 1996. During
September 1995 the Company, pursuant to Board of Directors approval, converted
the remaining outstanding preferred stock to common stock. Management believes
this dramatic event will also enhance earnings per common share now that the
Company has eliminated the payment of future preferred dividends.
10
<PAGE> 11
Financial Condition
Working capital reflected a slight increase of $31,800 to $7,169,000 at
September 30, 1995 compared to $7,137,200 at June 30, 1995. The increase is
attributed to a decrease in the deferred tax valuation allowance for the
additional recognition of the Company's net operating loss carryforwards net of
fluctuations in accounts receivable, accounts payable and inventories. Cash
flows from operations were consistent with the same period last year and
continue to verify the Company's ability to sustain profitable operations at
current sales volumes.
The Company expended a total of $136,900 for property, plant and equipment
during the three months ended September 30, 1995 compared to $2,039,400 for the
same period last year. The decrease is attributed to the purchase of the
Bensenville, Illinois property ($1,700,000) and various construction in
progress projects ($110,000) which were completed during the prior year period
ended September 30, 1994. The Company anticipates spending an additional
$1,100,000 during the remaining of fiscal 1996 on various machinery and
equipment and plant expansion projects
Borrowings under the line of credit decreased slightly by $130,200 to
$2,930,100 between June 30, 1995 and September 30, 1995. At September 30, 1995
the Company had approximately $2,100,000 available for future borrowings under
its revolving line of credit.
In September 1995 the Company redeemed 250,232 shares of its 9% preferred stock
at the stated redemption value of $1 per share. On September 25, 1995,
pursuant to unanimous Board of Directors approval, the Company proceeded to
convert remaining outstanding preferred shares to the Company common stock.
The conversion was based on the issuance of one share of the Company's common
stock for every two shares of preferred stock outstanding. The conversion
resulted in the issuance of 1,374,884 shares of common stock. The complete
conversion of the remaining outstanding preferred stock will save the Company
approximately $250,000 annual cash flows due to the elimination of future
preferred dividend payments, eliminate the need to incur additional debt and
interest costs to redeem the preferred stock, as well as enhance overall common
shareholder value. Management is committed to providing the best possible
return to its shareholders and believe this will provide essential long-term
benefits. The Company does not plan to issue any preferred shares in the
future. The Company will also consider the payment of future cash dividends on
its common shares now that certain restrictive loan covenants are no longer
applicable.
Cash flows from operations in conjunction with the Company's revolving line of
credit and machinery and equipment loan commitment are expected to meet the
Company's needs for working capital, preferred stock dividends, capital
expenditures and repayment of long-term debt for the foreseeable future.
11
<PAGE> 12
ROTONICS MANUFACTURING INC.
PART II. OTHER INFORMATION
<TABLE>
<S> <C>
Item 6. Exhibits and Reports on Form 8-K
- ------- --------------------------------
(a) Exhibits
--------
11. Statement Regarding Computation of Per Share Earnings.
(b) Reports on Form 8-K
-------------------
None.
</TABLE>
12
<PAGE> 13
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this Report to be signed on behalf by the
undersigned thereunto duly authorized.
Rotonics Manufacturing Inc.
Registrant
Date: October 20, 1995
-----------------------------------
Sherman McKinniss
President and
Chief Executive Officer
13
<PAGE> 1
STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS
EXHIBIT 11
<TABLE>
<CAPTION>
Three Months Ended
September 30,
---------------------------------
1995 1994
----------- -----------
<S> <C> <C>
PRIMARY
- -------
Net income $ 450,900 $ 845,400
Less preferred stock dividends (62,000) (81,300)
---------- ----------
Income applicable to common shares $ 388,900 $ 764,100
========== ==========
Weighted average number of common shares outstanding 12,891,943 12,298,423
Add - common equivalent shares:
Shares issuable upon exercise of options to
purchase common stock 10,765 5,760
---------- ----------
Weighted average number of common shares used in
computation of primary earnings per common share 12,902,708 12,304,183
========== ==========
Primary earnings per common share $ .03 $ .06
========== ==========
FULLY DILUTED
- -------------
Net income $ 450,900 $ 845,400
Less preferred stock dividends (62,000) (81,300)
---------- ----------
Income applicable to common shares $ 388,900 $ 764,100
========== ==========
Weighted average number of common shares outstanding 12,891,943 12,298,423
Add - common equivalent shares:
Shares issuable upon exercise of options to
purchase common stock 11,950 6,511
---------- ----------
Weighted average number of common shares used in
computation of fully diluted earnings per
common share 12,903,893 12,304,934
========== ==========
Fully diluted earnings per common share $ .03 $ .06
========== ==========
</TABLE>
15
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-START> JUL-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 15,600
<SECURITIES> 0
<RECEIVABLES> 4,524,400
<ALLOWANCES> 132,000
<INVENTORY> 5,235,600
<CURRENT-ASSETS> 11,050,100
<PP&E> 13,952,400
<DEPRECIATION> 5,529,200
<TOTAL-ASSETS> 29,059,100
<CURRENT-LIABILITIES> 3,881,100
<BONDS> 0
<COMMON> 24,574,000
0
0
<OTHER-SE> (6,709,900)
<TOTAL-LIABILITY-AND-EQUITY> 29,059,100
<SALES> 8,981,900
<TOTAL-REVENUES> 8,981,900
<CGS> 6,798,000
<TOTAL-COSTS> 8,340,900
<OTHER-EXPENSES> 142,100
<LOSS-PROVISION> 22,400
<INTEREST-EXPENSE> 191,000
<INCOME-PRETAX> 498,900
<INCOME-TAX> 48,000
<INCOME-CONTINUING> 450,900
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 450,900
<EPS-PRIMARY> .03
<EPS-DILUTED> .03
</TABLE>
