FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31,
1999, or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number: 33-10943-NY
PHOTON TECHNOLOGY INTERNATIONAL, INC.
- --------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
NEW JERSEY 22-2494774
- --------------------------------------------------------------------------------
(State of Incorporation) (I.R.S. Employer Identification No.)
1 Deer Park Drive, Suite F, Monmouth Junction, NJ 08852
- --------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Issuer's Telephone Number, Including Area Code: (732) 329-0910
-------------------------
Check whether the Issuer (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 [ ]
----- -----
The number of shares of Common Stock without par value outstanding as of
December 31, 1999 was 1,178,770.
<PAGE>
INDEX
PHOTON TECHNOLOGY INTERNATIONAL, INC.
PART I. FINANCIAL INFORMATION
- -----------------------------------
Item 1. Financial Statements:
Consolidated Balance Sheets as of December 31, 1999
Consolidated Statements of Operations and
Comprehensive Loss
three months ended December 31, 1999 and 1998
Consolidated Statements of Operations and
Comprehensive Income (Loss)
six months ended December 31, 1999 and 1998
Consolidated Statements of Cash Flows for the
six months ended December 31, 1999 and 1998
Notes to Consolidated Financial Statements
December 31, 1999
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1 -- FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
PHOTON TECHNOLOGY INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
December 31
1999
----------
ASSETS (Unaudited)
<S> <C>
CURRENT ASSETS
Cash and cash equivalents $ 131,040
Trade accounts receivable, less allowance
of $28,256 1,161,090
Inventory
Finished goods 589,730
Work in process 287,317
Raw materials 758,581
----------
1,635,628
Prepaid expenses and other current assets 143,190
----------
TOTAL CURRENT ASSETS 3,070,948
PROPERTY AND EQUIPMENT
Furniture and fixtures 154,956
Machinery and equipment 2,298,045
----------
2,453,001
LESS: Accumulated depreciation 1,972,279
----------
480,722
OTHER ASSETS
Intangible Assets 1,088,737
Note Receivable 840,456
----------
$5,480,863
==========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
PHOTON TECHNOLOGY INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS - Continued
December 31
1999
-----------
(Unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C>
CURRENT LIABILITIES
Bank indebtedness $ 624,961
Accounts payable 459,491
Deferred Revenue 42,328
Accrued expenses 206,058
Current portion of long term debt and capital lease obligations 920,262
-----------
TOTAL CURRENT LIABILITIES 2,253,100
LONG TERM DEBT AND CAPITAL LEASE OBLIGATIONS 663,805
PREFERRED SHARES - Canadian Subsidiary 1,958,147
STOCKHOLDERS' EQUITY
Preferred stock, $1,000 par value, authorized 500
shares; no shares issued or outstanding
Common Stock, no par value: authorized
3,333,333 shares; issued 1,292,477 shares,
including 113,707 shares in treasury 6,309,370
Accumulated deficit (5,515,523)
Treasury stock, at cost (48,995)
Accumulated Other Comprehensive Loss (139,041)
-----------
TOTAL STOCKHOLDERS' EQUITY 605,811
-----------
$ 5,480,863
===========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
PHOTON TECHNOLOGY INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
INCOME (LOSS) - (UNAUDITED)
Three Months Ended
December 31,
----------------------------
1999 1998
----------- -----------
<S> <C> <C>
REVENUES
Net sales $ 1,963,077 $ 1,745,263
Other income 129,340 85,363
----------- -----------
2,092,417 1,830,626
COSTS AND EXPENSES
Cost of products sold 931,213 745,172
Selling, general and administrative 727,443 785,068
Research and development 151,549 142,534
Interest 51,948 65,917
Depreciation and amortization 115,240 172,475
Foreign exchange (income) loss (4,156) 10,451
----------- -----------
1,973,237 1,921,617
----------- -----------
Income (loss) before income taxes 119,180 (90,991)
Income taxes -0- 10,500
----------- -----------
Net Income (Loss) $ 119,180 ($ 101,491)
=========== ===========
Other Comprehensive Income (Loss):
Foreign Currency Translation Adjustment _411,977 __(6,652)
----------- -----------
Total Comprehensive Income (Loss) $ 531,157 ($ 108,053)
=========== ===========
Net Income (Loss) per common share _ $0.10 ($ 0.09)
=========== ===========
Weighted average number of common
shares outstanding 1,178,770 1,169,694
=========== ===========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
PHOTON TECHNOLOGY INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
INCOME (LOSS) - (UNAUDITED)
Six Months Ended
December 31,
----------------------------
1999 1998
----------- -----------
<S> <C> <C>
REVENUES
Net sales $ 3,978,725 $ 3,858,058
Other income 130,709 94,811
----------- -----------
4,109,434 3,952,869
COSTS AND EXPENSES
Cost of products sold 1,902,980 1,679,989
Selling, general and administrative 1,571,828 1,505,038
Research and development 307,394 291,981
Interest 106,004 135,176
Depreciation and amortization 237,349 347,566
Foreign exchange (income) loss (8,631) 20,051
----------- -----------
4,116,924 3,979,801
----------- -----------
Loss from continuing operations and
before income taxes (7,490) (26,932)
Income taxes -0- 14,000
----------- -----------
Net Loss ($ 7,490) ($ 40,932)
=========== ===========
Other Comprehensive Income (Loss):
Foreign Currency Translation Adjustment 421,659 20,501
----------- -----------
Total Comprehensive Income (Loss) $ 414,169 ($ 25,858)
=========== ===========
Net Loss per common share ($ 0.01) ($ 0.04)
=========== ===========
Weighted average number of common
shares outstanding 1,176,350 1,168,525
=========== ===========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
<TABLE>
<CAPTION>
PHOTON TECHNOLOGY INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS - (UNAUDITED)
Six Months Ended
December 31,
------------------------
OPERATING ACTIVITIES: 1999 1998
--------- ---------
<S> <C> <C>
Net Loss ($ 7,490) ( $40,932)
Adjustments to reconcile net loss to net
cash provided (used) by operating activities:
Depreciation 89,785 94,240
Amortization 147,556 253,326
Decrease in deferred income taxes 0 14,000
Gain from sale of subsidiary (108,709) 0
Changes in operating assets and liabilities
(Increase) decrease in trade accounts receivable (190,353) 408,375
(Increase) decrease in inventory (103,689) 126,280
(Increase) decrease in prepaid expenses and other
current assets 5,056 (62,420)
Increase (decrease) in accounts payable and
accrued liabilities (3,373) (220,950)
Increase in deferred revenue (7,280) (25,299)
--------- ---------
Net cash provided (used) by operating activities (178,497) 546,620
--------- ---------
INVESTING ACTIVITIES:
Proceeds from sale of subsidiary 1 0
Purchase of property and equipment (19,371) (16,923)
Capitalized software (78,711) (41,535)
--------- ---------
Net cash (used) by investing activities (98,082) (58,458)
--------- ---------
FINANCING ACTIVITIES:
Increase (decrease) in bank indebtedness 237,342 (318,163)
Repayment of long-term debt (79,450) (196,158)
Proceeds from issuance of common stock - Employee
Stock Purchase Plan 2,572 3,478
--------- ---------
Net cash provided (used) by financing activities 160,464 (510,843)
--------- ---------
Effect of exchange rate changes on cash (14,502) 53,785
--------- ---------
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS (130,617) 31,104
CASH AND CASH EQUIVALENTS-BEGINNING 261,657 258,007
--------- ---------
CASH AND CASH EQUIVALENTS-ENDING $ 131,040 $ 289,111
========= =========
Supplemental disclosure of cash paid for:
Interest $ 103,570 $ 133,372
</TABLE>
SUPPLEMENTAL DISCLOSURE OF NON-CASH TRANSACTION
The Company sold the PhotoMed GmbH subsidiary for a sum of $150,001, which
included cash of $1.00 and a note of $840,456 consisting of the remaining
$150,000 sale price and $690,456 of trade accounts receivable outstanding from
PhotoMed as of December 1, 1999.
See Notes to Consolidated Financial Statements
<PAGE>
PHOTON TECHNOLOGY INTERNATIONAL, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1999
NOTE A -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Photon Technology International Inc. (the "Company") is engaged in research,
development, manufacturing, sales and marketing of proprietary electro-optical
systems, which enable customers in health care, environmental science and
industrial process control to perform advance analysis utilizing light. The
Company's major products are electro-optical and light-based instrumentation
which utilizes fluorescence technology. The primary markets are medical life
sciences, physical sciences, environmental and industrial.
The Company operates in one principal industry segment, the photonics industry.
The Company's products are sold on a worldwide basis to universities, research
hospitals, pharmaceutical companies, bio-tech companies, federal and state
government institutions, environmental companies and commercial business, all of
which are primarily engaged in research activities.
The accompanying consolidated financial statements of Photon Technology
International, Inc. have been prepared in accordance with generally accepted
accounting principles in the United States for interim financial information and
with the instructions to Form 10-KSB and Regulation S-B. Accordingly, they do
not include all of the information and footnotes 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 have been included. Operating results for the
six-month period ended December 31, 1999 are not necessarily indicative of the
results that may be expected for the year ending June 30, 2000. For further
information, refer to the consolidated financial statements and footnotes
thereto included in the Company's annual report or Form 10-KSB for the year
ended June 30, 1999.
NOTE B -- COMPARATIVE AMOUNTS
Certain comparative amounts in the prior year have been reclassified to conform
to the presentation adopted in the current fiscal year.
NOTE C - SALE OF SUBSIDIARY
On December 1, 1999, the Company sold its one hundred percent ownership of its
German subsidiary, PhotoMed GmbH, to the Company's Chairman and Chief Executive
Officer, Charles G. Marianik. PhotoMed GmbH entered into an exclusive
distributorship of the Company's products in Germany, Scandinavia and several
other European countries. In addition, PhotoMed GmbH will retain its exclusive
distributorship for Omega/USA in Germany and Austria.
The Company sold the PhotoMed GmbH subsidiary for a sum of $150,001, which
included cash of $1.00 and a note of $840,456 consisting of the remaining
$150,000 sale price and $690,456 of trade accounts receivable outstanding from
PhotoMed as of December 1, 1999.
The operations of PhotoMed GmbH for the two and five months ended November 30,
1999 and the quarter and six months ended December 31, 1998 are included with
the results of operations of the Company as a whole in the Consolidated
Statements of Operations and Comprehensive Income (Loss). The results of
operations of PhotoMed for the five months ended November 30, 1999 were net
revenues of $809,201, less costs and expenses of $770,497, for income from
operations of $38,704. The results of operations of PhotoMed for the two months
ended November 30, 1999 were net revenues of $279,399, less costs and expenses
of $244,197, for income from operations of $35,202.
<PAGE>
PHOTON TECHNOLOGY INTERNATIONAL, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1999
NOTE C - SALE OF SUBSIDIARY (continued)
The results of operations of PhotoMed for the six months ended December 31, 1998
were net revenues of $787,271, less costs and expenses of $727,892, for income
from operations of $59,379. The results of operations of PhotoMed for the three
months ended December 31, 1998 were net revenues of $320,918, less costs and
expenses of $324,813, for a loss from operations of $(3,895).
Included with the current fiscal year's consolidated income from operations as
other income is a gain of $108,709 from the sale of the PhotoMed GmbH
subsidiary.
The results of PhotoMed operations, including the gain of sale of the
subsidiary, on a per share performance based on the weighted average number of
common shares outstanding for each period was income of $0.12 and $0.12 per
share for the quarter and six months ended December 31, 1999, respectively. This
is in comparison to a loss of $(0.01) per share and income of $0.05 per share
for the same periods in fiscal 1999
For further information, refer to the consolidated financial statements and
footnotes thereto included in the Company's annual report or Form 10-KSB for the
year ended June 30, 1999.
<PAGE>
ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
- ---------------------
Net sales for the quarter and six months ended December 31, 1999 of $2.0 million
and $4.0 million increased $218,000, or 12.5%, and $121,000, or 3.1%,
respectively, compared to the same periods of fiscal 1999. These increases
reflect the impact of a higher sales order backlog in the current fiscal year
carried over from fiscal 1999.
Total revenues for the quarter and six months ended December 31, 1999 of $2.1
million and $4.1 million, which include net sales and other income, increased
$262,000, or 14.3%, and $157,000, or 4.0%, respectively, compared to the same
periods of fiscal 1999. This performance reflects both the increased net sales
and other income. Other income for the quarter and six months ended December 31,
1999 included a $108,000 gain from sale of the PhotoMed GmbH subsidiary. Other
income for the quarter and six months ended December 31, 1998 included $78,000
of deferred revenue recognition of certain customer deposits.
Cost of products sold for the second quarter of fiscal 2000 was $931,000, or
47.4%, of net sales, which compares to $745,000, or 42.7% of net sales for the
same period of fiscal 1999. This increase of $186,000, or 25.0%, was primarily
due to increased net sales, an increase in service costs, and an $115,000
increase of the reserve for future loss of inventory value against the same
period in fiscal 1999. Cost of products sold for the six months ended December
31, 1999 was $1.9 million, or 47.8%, of net sales, which compares to $1.7
million, or 43.5% of net sales for the same period of fiscal 1999. This was an
increase of $223,000, or 13.3%, was due to increased net sales, increased
service costs, and the aforementioned increase in inventory reserves. Service
costs are anticipated to decline accompanying the sale of the PhotoMed GmbH
subsidiary and anticipated personnel reductions that have been planned
throughout the remainder of the current fiscal year
Selling (including marketing), general and administrative expenses of $727,000,
or 37.1% of net sales, for the second quarter of fiscal 2000 decreased $58,000,
or 7.3%, in comparison to $785,000, or 45.0% of net sales for the same period in
fiscal 1999. For the six month period ended December 31, 1999 these expenses of
$1.6 million, or 39.5% of net sales, increased $67,000, or 4.4%, from $1.5
million, or 39.0% of net sales, in fiscal 1999. The increase in selling and
marketing expenses of $101,000 for the six-month period in fiscal 2000 was
offset by decreases of $34,000 for general and administrative expenses in
comparison to the prior fiscal year. General and administrative expenses for the
second quarter in fiscal 1999 declined $57,000, or 19.4%, in comparison to the
prior fiscal year. After adjusting for the sale of the Photomed GmbH subsidiary,
these costs are expected to decline slightly accompanying anticipated personnel
reductions that have been planned throughout the remainder of the current fiscal
year.
<PAGE>
ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS (continued)
- ---------------------------------
Research and development expenses for the second quarter and six months ended
December 31, 1999 were $152,000, or 7.7% of net sales and $307,000, or 7.7% of
net sales, respectively. In comparison to the prior fiscal year these expenses
were $143,000, or 8.2% of net sales for the quarter and $292,000, or 7.6% of net
sales for the six-month period. An additional $79,000 of software development
expenses, which represents 2.0% of net sales, was capitalized for the six months
ended December 31, 1999 in comparison to $42,000 for the same period in fiscal
1999. These expenses are due to the level of project activity for new products.
Interest expense for the six months ended December 31, 1999 of $106,000
decreased $29,000, or 21.6% in comparison to the prior fiscal year. Interest
expense for the second quarter of $52,000 decreased $14,000 or 21.2% in
comparison to the same period in fiscal 1999. These decreases primarily relate
to the decreased level of average bank indebtedness in comparison to the prior
fiscal year.
Depreciation and amortization of $115,000 for the second quarter and $237,000
for the six months ended December 31, 1999 decreased $57,000, or 33.2%, and
$110,000, or 31.7%, respectively, in comparison to the same periods in fiscal
1999. This decrease was primarily due to no amortization in the fiscal year
relating to specific goodwill of the PhotoMed GmbH subsidiary, which was fully
amortized by the fourth quarter of fiscal 1999.
Foreign exchange income for the quarter and six months ended December 31, 1999
of $4,000 and $9,000, respectively, compares to losses of $10,000 and $20,000
for the same periods in fiscal 1999, due to a mix of transactional activity.
The Company reported net income of $101,000 for the second quarter, compared to
a net loss of $101,000 for the second quarter of the prior fiscal year. For the
six months ended December 31, 1999 the net loss was $7,000 in comparison to a
net loss of $41,000 for the same period on fiscal 1999. The increase in net
sales, the gain on the sale of the PhotoMed GmbH subsidiary, and increases in
cost of products sold, and selling, general and administrative expenses
discussed above were major impacts on income.
The resulting per share performance based on the weighted average number of
common shares outstanding for each period was net income of $0.10 per share and
a net loss of $(0.01) for the quarter and six months ended December 31, 1999, in
comparison to net losses of $(0.09) and $(0.04) per share for the same periods
in fiscal 1999.
<PAGE>
ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
The working capital of the Company at December 31, 1999 was $818,000 compared to
$1.8 million at June 30, 1999, a decrease of $1.0 million, or 55.6%.
Current assets of $3.1 million decreased $212,000, or 6.58%, from June 30, 1999.
This change primarily reflects decreases of $131,000 and $76,000 in cash and
accounts receivable, respectively. These changes reflected decreases of 50.0%
and 6.1% of these respective balances at June 30, 1999. The decrease in accounts
receivable reflects the impact of the sale of the PhotoMed GmbH subsidiary. The
inventory balance represented 5.2 months of sales in inventory, which is
comparable to the 5.5 months of sales in inventory at June 30, 1999. The trade
accounts receivable balance of $1.1 million represents 1.75 months of sales in
comparison to 1.88 months of sales at June 30, 1999.
Current liabilities of $2.3 million increased $813,000 or 56.5% in comparison to
the balance as of June 30, 1999. This increase was due principally to increases
in bank indebtedness and current portion of long-term debt of $87,000 and
$761,000, or 16.2% and 476.8% of their respective balances at June 30, 1999. The
significant increase of the current portion of long-term debt is due to the
inclusion of entire balance of the Covington Capital debt facility as current
debt.
As of December 13, 1999 the Company renewed its working capital line of credit
with Silicon Valley Bank of California for $2,000,000. This credit facility has
a one (1) year term (expiring December 13, 2000) and carries an interest rate at
the prime rate plus 1.5% (approximately 10.00% at December 31, 1999). Interest
is due and payable monthly, and the principal is due at maturity. The collateral
for the line represents a perfected first security interest in all the assets of
the Company, its wholly owned Canadian subsidiary and United Kingdom branch. The
Company will retain ownership of intellectual property and is restricted on the
pledge of this property to any other party. The advance rate is based on 75%
against eligible domestic and Canadian receivables within ninety (90) days from
invoice date and 90% against insured or letter of credit domestic and foreign
receivables. The Company is not required to pay the outstanding balance in full
at any time during the term of the note. The balance outstanding at December 31,
1999 was $624,961. The securities related to the Covington Capital debenture and
the MLTV note payable is subordinated to the bank debt.
During March 1998, the Company reached an understanding with MLTV that interest
would not accrue on the $630,000 principal amount of debt due by the Company and
that such balance would only become due upon the sale of the Company or at such
time as MLTV were to dispose of its interest in the Company.
<PAGE>
ITEM 2 -- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (continued)
LIQUIDITY AND CAPITAL RESOURCES (continued)
- -------------------------------------------
On October 31, 1995, the Company entered into a Debenture agreement for $1.5
million Canadian dollars ($1.1 million US) through C.I.-C.P.A. Business Venture
Fund, Inc., a capital fund of Covington Capital Corporation ("Covington
Capital") (the "Covington Agreement"). This subordinated debt has a term of five
(5) years at an interest rate of 12% per annum. Payments of principal commenced
on November 30, 1996 in the amount of $6,250 Canadian dollars ($4,300 US) per
month for a period of forty-eight (48) months with the balance due at the end of
the term. This financing was an important source of funds which provided for
investment to expand sales territory coverage through addition of personnel,
increase marketing support, and continue research and development efforts in
both hardware and software for new products and product cost reductions. The
outstanding balance as of December 31, 1999 was $1,262,500 Canadian dollars
($868,600 US). The entire balance of this facility is due in October 2000.
In July 1994, documents were fully executed between the "ODC" and the Company
for a term loan facility in the amounts of $500,000 Canadian dollars. The loan
credit facility was established to allow production requests for equipment,
inventory and training expenditures associated with moving the production
operation from New Jersey plant to the London, Ontario plant. The term of
repayment was forty (40) months and includes an interest rate of 6.75%. The
balance of this debt facility was paid in full in October 1999.
On March 7, 1997, the Company raised its first significant equity financing
since 1987, for $2,000,000, net $1,958,147 (for detail on specific terms, refer
to Note I to the Financial Statements in Form 10-KSB for June 30, 1999). The
importance of this financing is that it allows the Company to pursue its growth
goals. The Company will use the financing for new product introduction and to
expand it sales and marketing coverage.
If the Company has to repay some of the short term maturing debt, it will lose a
substantial portion of its financial resources to pursue its current plans.
Whereas there is every reason to believe that the Company can refinance its
maturing debt, there is no guarantee that it will be able to do so.
The Company will continue to manage within its financial resources and attempt
to balance its working capital needs with cash flow generated from operations
and available current financing. The Company cannot be certain that it will be
successful in efforts to raise additional funds.
YEAR 2000 ISSUE
The Company did not experience any negative problems or results with respect to
the Year 2000 issue. However, the Company will continue to monitor for any
potential impacts on operations that may currently be unforeseen. The Company
believes that the cost of Year 2000 modifications for both internal use software
and systems or the Company's products were not material. (The Company estimates
the accumulated expenditures relating to Year 2000 issues have not exceeded
$100,000).
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
- ------- ------------------
Neither the Company nor any of its subsidiaries is currently a party to
nor is any of their property the subject of any legal proceedings which would be
material to the business or financial condition of the Company on a consolidated
basis.
Item 2. Changes in Securities.
- ------- ----------------------
Not Applicable
Item 3. Defaults Upon Senior Securities.
- ------- --------------------------------
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders.
- -------------------------------------------------------------
The Company held its annual meeting of shareholders on Friday December
10, 1999. The only matter considered and voted upon at the meeting was the
election of three directors for a three-year term each.
The voting for directors Franklin J. Iris and Dr. Robert E. Curry was
1,170,925 shares for 0 shares against and 3,500 shares withheld, and voting for
director M. Grant Brown was 1,170,975 shares for 0 shares against and 3,450
shares withheld.
Item 5. Other Information.
- ------- ------------------
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
- ------- --------------------------------
(a) Exhibits
(27) Financial Data Schedule
(b) Reports on Form 8-K
None
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Issuer
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
PHOTON TECHNOLOGY INTERNATIONAL, INC.
Date: February 15, 2000 By: /s/ Charles G. Marianik
------------------------
Charles G. Marianik
President, Chief Executive Officer
and Director
(Principal Executive Officer)
Date: February 15, 2000 By: /s/ William J. Hiltner, III
------------------------------
William J. Hiltner, III
Corporate Controller
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-2000
<PERIOD-END> DEC-31-1999
<CASH> 131,040
<SECURITIES> 0
<RECEIVABLES> 1,189,346
<ALLOWANCES> (28,256)
<INVENTORY> 1,635,628
<CURRENT-ASSETS> 3,070,948
<PP&E> 2,453,001
<DEPRECIATION> 1,972,279
<TOTAL-ASSETS> 5,480,863
<CURRENT-LIABILITIES> 2,253,100
<BONDS> 0
1,958,147
0
<COMMON> 6,309,370
<OTHER-SE> (5,703,559)
<TOTAL-LIABILITY-AND-EQUITY> 5,480,863
<SALES> 3,978,725
<TOTAL-REVENUES> 4,109,434
<CGS> 1,902,980
<TOTAL-COSTS> 1,902,980
<OTHER-EXPENSES> 2,107,940
<LOSS-PROVISION> (749)
<INTEREST-EXPENSE> 106,004
<INCOME-PRETAX> (7,490)
<INCOME-TAX> 0
<INCOME-CONTINUING> (7,490)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (7,490)
<EPS-BASIC> (0.01)
<EPS-DILUTED> 0
</TABLE>
