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Previous: MUNICIPAL SECURITIES TRUST HIGH INCOME SERIES 13, 24F-2NT, 1995-08-25 |
Next: MUNICIPAL SECURITIES TRUST 59TH DISCOUNT SERIES, 24F-2NT, 1995-08-25 |
<PAGE>
FORM 10-Q/A
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Amendment No. 1
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended July 1, 1994
-----------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission file number 0-16172
--------------------
COMPUTONE CORPORATION
--------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 23-2472952
------------------------------- ---------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
1100 Northmeadow Parkway, Suite 150, Roswell, GA 30076
------------------------------------------------ ----------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (404)475-2725
-------------
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 by check mark whether the registrant has filed all documents
and reports required to be filed by Section 12, 13 or 15 (d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Yes X No .
--- ---
As of August 15, 1994, there were 6,205,217 shares of common stock
outstanding.
<PAGE>
INDEX
PART I. FINANCIAL INFORMATION
------- ---------------------
<TABLE>
<CAPTION>
ITEM 1. Financial Statements:
<S> <C> <C>
Interim Condensed Consolidated Balance Sheets
as of July 1, 1994 and April 1, 1994 3
Interim Condensed Consolidated Statements
of Income for the three months
ended July 1, 1994 and July 2, 1993 4
Interim Condensed Consolidated Statements
of Cash Flows for the three months ended
July 1, 1994 and July 2, 1993 5
Notes to Interim Condensed Consolidated
Financial Statements 6
ITEM 2. Management's Discussion and Analysis
of Results of Operations and Financial
Condition 8
PART II. OTHER INFORMATION
-------- -----------------
ITEM 1. Legal Proceedings 10
ITEM 2. Changes in Securities 10
ITEM 4. Submission of Matters to a Vote of
Security Holders 10
ITEM 5. Other Information 10
ITEM 6. Exhibits and Reports on Form 8-K 10
</TABLE>
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
Computone Corporation
Interim Condensed Consolidated Balance Sheets
(in thousands except par value and shares)
<TABLE>
<CAPTION>
July 1, 1994 April 1, 1994
(unaudited) (audited)
------------ -------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 145 $ 215
Receivables, net 2,715 2,905
Inventories, net 2,683 2,621
Prepaid expenses and other 91 48
--------- --------
Total current assets 5,634 5,789
Property, equipment and improvements, net 1,158 1,168
Intangible assets, net 948 1,023
Other 167 167
--------- --------
TOTAL ASSETS $ 7,907 $ 8,147
========= ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable, trade $ 1,219 $ 1,201
Accrued liabilities:
Payroll 99 101
Costs related to discontinued operations 473 473
Other 1,044 1,198
Current maturities of long term obligations 631 791
--------- --------
Total current liabilities 3,466 3,764
Notes payable to affiliates 270 270
Other long term obligations 255 336
Stockholders' Equity
Convertible redeemable preferred stock, $.01 par value;
10,000,000 shares authorized; 200,000 share issued 2 2
Common stock, $.01 par value; 50,000,000 shares
authorized; 6,205,217 and 6,201,883 shares outstanding
at July 1, 1994 and April 1, 1994, respectively 62 62
Additional paid in capital 41,661 41,649
Accumulated deficit (37,809) (37,936)
--------- --------
Total stockholders' equity 3,916 3,777
--------- --------
Total liabilities and stockholders' equity $ 7,907 $ 8,147
========= ========
</TABLE>
See accompanying notes to the consolidated financial statements.
<PAGE>
ITEM 1. Financial Statements (continued)
Computone Corporation
Interim Condensed Consolidated Statements of Income
(in thousands except per share amounts)
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended
July 1, 1994 July 2, 1993
------------ ------------
<S> <C> <C>
Revenues:
Product sales $ 3,405 $ 3,862
Royalties -- 882
------- -------
Net revenues 3,405 4,744
Expenses:
Cost of products sold 2,091 2,366
Selling, general and administrative 980 988
Product development 293 329
------- -------
3,364 3,683
------- -------
Operating income from continuing operations 41 1,061
Non-Operating income (expense):
Other income (expense) 5 8
Interest expense (4) (60)
------- -------
Income from continuing operations before taxes 42 1,009
Income tax expense (benefit):
Current -- --
Deferred -- --
------- -------
-- --
------- -------
Income from continuing operations 42 1,009
Discontinued operations:
Income on disposal 85 --
------- -------
Income before extraordinary item 127 1,009
Extraordinary item:
Debt foregiveness -- --
------- -------
Net income $ 127 $ 1,009
======= =======
Net income per common share and common
share equivalents:
Income from continuing operations 0.01 0.20
Income from discontinued operations 0.01 --
Income from extraordinary item -- --
------- -------
Net income per common share $ 0.02 $ 0.20
======= =======
Weighted average common shares and
common share equivalents outstanding 6,420 5,060
======= =======
</TABLE>
See accompanying notes to the consolidated financial statements.
<PAGE>
ITEM 1. Financial Statements (continued)
Computone Corporation
Interim Condensed Consolidated Statements of Cash Flows
(in thousands)
<TABLE>
<CAPTION>
For the Three Months Ended
July 1, 1994 July 2, 1993
(unaudited) (unaudited)
------------ ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Income from continuing operations $ 42 $ 1,009
Adjustments to reconcile income from continuing operations
to net cash provided by (used in) continuing operations:
Depreciation and amortization 208 162
Provision for doubtful accounts 92 458
Amortization of debt discount --- 5
Changes in assets and liabilities:
(Increase) decrease in receivables 97 36
(Increase) decrease in inventories (62) 95
(Increase) decrease in prepaid expenses and other (43) (55)
(Increase) decrease in deferred taxes --- (383)
(Decrease) increase in accounts payable and
accrued liabilities (123) (174)
--------- ---------
Net cash (used in) provided by continuing operations 211 1,153
--------- ---------
Income from discontinued operations 85 ---
Adjustments to reconcile loss from discontinued
operations to net cash used in discontinued operations:
Income on disposal (85) ---
Change in net assets of discontinued operations (104) ---
Provision for loss on disposal --- ---
--------- ---------
Net cash used in discontinued operations (104) ---
--------- ---------
Net cash provided by (used in) operating activities 107 1,153
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
(Increase) decrease in other assets --- (88)
Capitalization of software costs (40) (100)
Purchase and capitalization of property and equipment (85) (67)
--------- ---------
Net cash used in investing activities (125) (255)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of debt (64) (193)
Exercise of common stock options 12 12
--------- ---------
Net cash (used in) provided by financing activities (52) (181)
--------- ---------
Net increase in cash and cash equivalents (70) 717
Cash and cash equivalents at beginning of period 215 104
--------- ---------
Cash and cash equivalents at end of period $ 145 $ 821
========= =========
SUPPLEMENTAL DISCLOSURES:
Interest paid $ 1 $ 3
========= =========
</TABLE>
See accompanying notes to the consolidated financial statements.
<PAGE>
COMPUTONE CORPORATION
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION
---------------------
The financial statements included in this Form 10-Q have been prepared
by the Company, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures, normally included in financial statements prepared in accordance
with generally accepted accounting principles, have been condensed, or omitted,
pursuant to such rules and regulations. These financial statements should be
read in conjunction with the financial statements and related notes included in
the Company's Fiscal 1994 Form 10-K.
The financial statements presented herein, as of July 1, 1994, and for
the three months then ended, reflect in the opinion of management, all
adjustments necessary for a fair presentation of financial position and the
results of operations for the periods presented. The results of operations for
any interim period are not necessarily indicative of the results for the full
year.
2. INVENTORIES
-----------
Inventories, net of a reserve for obsolete, excess and non-salable
items, consisted of the following at July 1, 1994 and April 1, 1994 (in
thousands):
<TABLE>
<CAPTION>
July 1,1994 Apr 1,1994
----------- ----------
<S> <C> <C>
Finished goods $ 405 $ 799
Work in progress 538 542
Raw materials 1,740 1,280
------ ------
$2,683 $2,621
====== ======
</TABLE>
3. INCOME PER SHARE
----------------
Income per common share is computed by dividing net income applicable to
common stock by the weighted average number of shares of common stock and common
share equivalents outstanding during each period.
On November 30, 1993, the Company effected a one-for-six reverse stock
split of the Company's Common Stock effective as of that date. Accordingly, the
weighted average number of shares
<PAGE>
COMPUTONE CORPORATION
NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
outstanding and per share amounts in the accompanying condensed consolidated
financial statements have been restated for all periods.
4. INCOME TAXES
------------
On April 3, 1993, the Company adopted the Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes". Such adoption had
no cumulative effect on the Company's consolidated financial statements. Prior
years' financial statements have not been restated.
The Company has available net operating and capital loss carryforwards,
including preacquisition operating loss carryforwards which relate to a
predecessor company, which expire during the period 2003-2008. The Company's
possible use of the loss carryforwards will be limited as a result of several
different changes in ownership which have occurred since the carryforwards
started to accumulate. The use of the net operating loss carryforwards are
limited due to statutory provisions which apply after certain changes in control
occur.
For financial reporting purposes, a valuation allowance has been
established to reflect a net deferred tax balance of $0 as of the date of
adoption of FAS 109 as well as at July 1, 1994.
The Company estimates that no current provision for income taxes is
required for the three months ended July 1, 1994.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION FOR THE THREE
MONTHS ENDED JULY 1, 1994.
INTRODUCTION
------------
The comparative information contained herein includes results of
operations for the Company's continuing businesses. Certain previous components
of the Company are presented as discontinued operations in the accompanying
Consolidated Financial Statements.
LIQUIDITY
---------
Cash provided by income from continuing operations amounted to $107,000
for the three months ended July 1, 1994 compared to cash provided by continuing
operations of $1,153,000 for the comparable three months ended July 2, 1993. The
reduction in cash provided by continuing operations as compared to the prior
year fiscal quarter primarily reflects the termination of a royalty agreement
and a lump sum payment received during the three months ended July 2, 1993.
Cash used in financing activities amounted to $52,000 for the three
months ended July 1, 1994 compared with an outflow of $181,000 for the
comparable three months of the prior fiscal year.
Working capital surplus amounted to $2,168,000 at July 1, 1994, an
increase of $143,000 since April 1, 1994. The ratio of current assets to
current liabilities at July 1, 1994 was 1.63 to 1.00 compared to 1.54 to 1.00
at April 1, 1994. The increase in working capital is primarily attributable
to income from continuing operations and the repayment of outstanding debt.
The Company is currently negotiating with a lending institution to
secure a line of credit which will provide additional cash required to fund
expanded operations and to meet the demand for the Company's intelligent
controller products.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION FOR THE THREE MONTHS
ENDED July 1, 1994 (CONTINUED).
RESULTS OF OPERATIONS
---------------------
Product sales revenue from continuing operations for the quarter ended
July 1, 1994 totaled approximately $3,405,000 compared to product sales revenue
of $3,862,000 for the comparable quarter ended July 2, 1993, a decrease of
11.8%. Net revenues for the quarter ended July 2, 1993 included $882,000 related
to royalties received. The decrease in product sales revenue was due to a lack
of available cash to meet of the Company's intelligent controller products.
Management believes that in securing the bank line of credit discussed in the
"Liquidity and Capital Resources" section, the Company will be in an excellent
position for the remainder of fiscal 1995 to meet this demand and increase
product sales accordingly.
Cost of products sold for the quarter amounted to $2,091,000 or 61% of
product sales revenues versus $2,366,000 or 61% for the comparable quarter of
the prior year. The Company continues to focus on reducing the cost of products
sold in order to increase the profitability of continuing operations.
Selling, general and administrative expenses amounted to $980,000 or
28.7% of product sales revenue, versus 25.6% of product sales revenue for the
comparable quarter of the prior fiscal year.
Product development expenses amounted to $293,000 or 8.6% of product
sales revenue versus 8.5% of product sales revenue for the comparable quarter of
the prior fiscal year.
Income from discontinued operations totaled $85,000 for the quarter
ended July 1, 1994. This income is related to the disposal of certain assets the
Company had reduced to zero net cash value in prior years.
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None, other than those matters described in Item 3 to the Company's
Annual Report on Form 10-K for the year ended April 1, 1994.
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
Not Applicable.
ITEM 5. OTHER INFORMATION
Not Applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a) No exhibits are furnished with this report.
b) No reports on FORM 8-K or FORM 8 were filed during the quarter to
which this report pertains.
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) 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.
COMPUTONE CORPORATION
Date: August 25, 1995 By: /s/ Thomas J. Anderson
____________________________
Thomas J. Anderson
President & Chief Operating Officer
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<RESTATED>
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 3-MOS
<FISCAL-YEAR-END> APR-07-1995 APR-01-1994
<PERIOD-START> APR-02-1994 APR-03-1993
<PERIOD-END> JUL-01-1994 JUL-02-1993
<CASH> 145 215
<SECURITIES> 0 0
<RECEIVABLES> 3,761 3,858
<ALLOWANCES> 1,046 953
<INVENTORY> 2,683 2,621
<CURRENT-ASSETS> 5,634 5,789
<PP&E> 3,249 3,061
<DEPRECIATION> 2,091 1,893
<TOTAL-ASSETS> 7,907 8,147
<CURRENT-LIABILITIES> 3,466 3,764
<BONDS> 0 0
<COMMON> 62 62
0 0
2 2
<OTHER-SE> 0 0
<TOTAL-LIABILITY-AND-EQUITY> 7,907 8,147
<SALES> 3,405 3,862
<TOTAL-REVENUES> 3,405 4,744
<CGS> 2,091 2,366
<TOTAL-COSTS> 3,364 3,683
<OTHER-EXPENSES> 0 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 4 60
<INCOME-PRETAX> 42 1,009
<INCOME-TAX> 0 0
<INCOME-CONTINUING> 42 1,009
<DISCONTINUED> 85 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 127 1,009
<EPS-PRIMARY> .01 .20
<EPS-DILUTED> .01 .20
</TABLE>
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