<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-QSB
OMB Approval
OMB Number: xxxx-xxxx
Expires: Approval Pending
Estimated Average Burden Hours Per Response: 1.0
(Mark One)
[ X ] Quarterly report under Section 13 or 15(d) of the Securities Exchange
Act of 1934.
For the quarterly period ended March 31, 1995
[ ] Transition report under Section 13 or 15 (d) of the Exchange Act.
For the transition period from __________________ to _________________
Commission file number number 0-3555
David White, Inc.
- - -----------------------------------------------------------------------------
(Exact Name of Small Business Issuer as Specified in Its Charter)
Wisconsin 39-0967642
- - ---------------------------------------- -------------------------------
(State or Other Jurisdiction of (I. R. S. Employer
Incorporation or Organization) Identification No.)
11711 River Lane, Germantown, WI 53022
- - -----------------------------------------------------------------------------
(Address of Principal Executive Offices)
(414) 251-8100
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(Issuer's Telephone Number, Including Area Code)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 _______
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date:
Class Outstanding at April 30, 1995
- - ---------------------------------------- -------------------------------
Common Stock, $3.00 Par Value Per Share 527,823 Shares
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DAVID WHITE, INC.
INDEX
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
Part I. Financial Information
Consolidated Condensed Balance Sheets -
March 31, 1995 and December 31, 1994 3
Consolidated Condensed Statements of Earnings -
Three Months Ended March 31, 1995 and 1994 4
Consolidated Condensed Statements of Cash Flows -
Three Months Ended March 31, 1995 and 1994 5
Notes to Unaudited Consolidated Condensed
Financial Statements 6
Management's Discussion and Analysis of
Financial Condition and Results of
Earnings 7 & 8
Part II. Other Information
Signature 9
</TABLE>
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
DAVID WHITE, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(000'S)
<TABLE>
<CAPTION>
March 31, December 31,
Assets 1995 1994
------ ----------- --------------
(Unaudited)
<S> <C> <C>
Current Assets
- - --------------
Cash and cash equivalents $ 0 $ 892
Trade accounts receivable, net 3,404 1,442
Inventories 4,706 4,645
Other current assets 83 112
------ ------
Total current assets 8,193 7,091
Other Assets
- - ------------
Technology and patents, net 222 245
Intangible pension asset 211 211
Other 310 322
------ ------
743 778
Property, plant and equipment, net 2,322 2,176
Goodwill, net 1,129 1,150
------ ------
Total assets $ 12,387 $ 11,195
====== ======
Liabilities and Stockholders' Investment
-----------------------------------------
Current Liabilities
- - -------------------
Notes payable to bank $ 1,393 $ 413
Trade accounts payable 924 852
Accrued liabilities 638 676
Income taxes 116 173
Current maturities of long-term debt 289 284
---- -----
Total current liabilities 3,360 2,398
Long-term debt, less current maturities 2,073 2,148
Long-term pension liability 573 573
Minority interest 49 44
Stockholders' Investment
- - ------------------------
Preferred stock, par value $1 a share:
Authorized 1,000,000 shares; none issued
Common stock, par value $3 a share:
Authorized 5,000,000 shares; issued 692,240 shares 2,077 2,077
Additional paid-in capital 1,024 1,024
Retained earnings 4,961 4,747
Additional pension liability (362) (362)
Cumulative translation adjustment 169 83
Treasury stock at cost - 164,417 shares (1,537) (1,537)
------ ------
Total stockholders' investment 6,332 6,032
------ ------
Total liabilities and stockholders' investment $ 12,387 $ 11,195
====== ======
</TABLE>
See accompanying notes to unaudited consolidated condensed financial
statements.
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<PAGE> 4
DAVID WHITE, INC.
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(000'S) EXCEPT SHARE AND PER SHARE DATA
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
-------------------
1995 1994
-------- --------
<S> <C> <C>
Net sales $ 4,827 $ 4,243
Cost of goods sold 3,545 3,108
-------- --------
Gross margin 1,282 1,135
Selling and administrative expenses 891 784
-------- --------
Earnings from operations before
other expenses and income taxes 391 351
Other income (expenses)
Other income 7 0
Interest expense (76) (60)
Amortization of intangible assets (45) (46)
Minority interest (4) (4)
-------- --------
Earnings before income taxes 273 241
Income taxes 59 35
-------- --------
Net earnings $ 214 $ 206
======== ========
Net earnings per common share $ .41 $ .39
Average common shares outstanding 527,823 527,523
Dividends per common share outstanding $ .00 $ .00
</TABLE>
See accompanying notes to unaudited consolidated condensed financial
statements.
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<PAGE> 5
DAVID WHITE, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(000'S)
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
------------------
1995 1994
-------- --------
<S> <C> <C>
Cash flows from operating activities:
Net earnings $ 214 $ 206
Adjustments to reconcile net earnings to net
cash used in operating activities:
Depreciation 103 109
Amortization of intangible assets 45 46
Minority interest in earnings of subsidiary 4 4
Change in assets and liabilities:
(Increase) decrease in:
Accounts receivable (2,006) (1,857)
Inventories (3) (251)
Prepaid expenses and other assets 61 90
Increase (decrease) in:
Accounts payable and accrued liabilities 184 329
Income taxes (81) 29
------- -------
Net cash used in operating activities (1,479) (1,295)
Cash flows from investing activities:
Additions to property, plant & equipment (244) (68)
------- -------
Net cash used in investing activities (244) (68)
Cash flows from financing activities:
Principal payments on debt (70)
Net increase in notes payable to bank 894 1,357
------- -------
Net cash provided by financing activities 824 1,357
Effect of exchange rate changes on cash 7
Net increase (decrease) in cash and cash equivalents (892) (6)
Cash and cash equivalents at beginning of year 892 41
------- -------
Cash and cash equivalents at end of period $ 0 $ 35
======= =======
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest 76 55
Income taxes 140 6
</TABLE>
See accompanying notes to unaudited consolidated condensed financial
statements.
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<PAGE> 6
DAVID WHITE, INC.
NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
1. The condensed financial statements included herein 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, although the
Company believes that the disclosures are adequate to make the information
presented not misleading. It is suggested that these condensed financial
statements be read in conjunction with the audited financial statements
and the notes thereto incorporated by reference in the Company's latest
annual report on Form 10-KSB.
2. In the opinion of management, the aforementioned statements reflect all
adjustments (consisting only of normal recurring adjustments) necessary
for a fair presentation of the results for the interim periods. The
results of operations for the three months ended March 31, 1995 are not
necessarily indicative of the results to be expected for the full year.
3. It is not practicable to segregate the amounts of raw materials, work in
progress, finished goods or supplies.
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<PAGE> 7
DAVID WHITE, INC.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following is management's discussion and analysis of certain significant
factors that have affected the Company's earnings during the periods included
in the accompanying consolidated condensed statements of operations.
A summary of the period to period changes in the principal items included in
the consolidated condensed statements of operations is shown below:
<TABLE>
<CAPTION>
Comparison of
------------------
Three Months Ended
March 31,
1995 and 1994
-------------------
Increase (Decrease)
(000's)
<S> <C>
Net sales 584
Cost of goods sold 437
Selling and administrative expenses 107
Other income 7
Interest expense 16
Amortization of intangible assets (1)
Minority interest 0
Earnings before income taxes 32
Income taxes 24
Net earnings 8
</TABLE>
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<PAGE> 8
RESULTS OF OPERATIONS
FIRST QUARTER 1995 COMPARED TO FIRST QUARTER 1994
Consolidated sales of $4.8 million for the first quarter of 1995 were up 14%
from 1994's first quarter sales of $4.2 million, despite higher domestic
interest rates from a year ago. Gross margins for the first quarter of 1995 and
1994 remained steady at 27.6% and 27.7% respectively. Most of the gains from
increased domestic manufacturing activity were offset by unfavorable exchange
charges stemming from the deterioration of the U.S. dollar on incoming
shipments from the Company's Swiss subsidiary and other imports. Selling and
administrative expenses were up 14% or $107,000 on the 14% increase in sales.
Earnings improved from $206,000 for the first quarter of 1994 to $214,000 for
the first quarter of 1995. Interest expense was up $16,000 due to increase in
domestic bank loans from 1994 to support higher sales. In light of the
continuing unprofitability of its Swiss subsidiary, Ammann Lasertechnik AG, and
the deterioration of the U.S. dollar and its effect on the profitability of
products sold by Ammann Lasertechnik, the Company recently entered into
non-binding letters of intent to sell its 90% interest in its Swiss subsidiary
back to Hans-Rudolf Ammann. Although the sale, if and when it occurs, will
likely result in a negative impact on the Company's equity and current earnings
largely as a result of a write-off of goodwill, the value of the transaction
will likely exceed the book value of the subsidiary. Management believes the
proposed transaction would be in the best interests of the Company's
shareholders. The Board of Directors of the Company has taken the
recommendation from management under advisement and has directed management to
provide it with further information concerning the final terms being
negotiated.
LIQUIDITY
Each year domestic receivables increase during the first quarter as the Company
offers a deferred payment program to its key distributors. The Company will be
reducing its outstanding borrowings in the second quarter as the deferred
payments are collected. The domestic bank permanently increased the Company's
revolving credit line from $1 million to $1.75 million on March 21, 1995 to
accommodate the increased cash requirements. The interest rate on the
revolving line is the bank's prime rate, which is currently 9%.
CAPITAL RESOURCES
No significant capital commitments were outstanding at the end of the first
quarter.
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<PAGE> 9
SIGNATURE
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.
DAVID WHITE, INC.
---------------------------------------
(Registrant)
/s/ Tony L. Mihalovich
---------------------------------------
Tony L. Mihalovich
(President)
/s/ James L. Younk
---------------------------------------
James L. Younk
(Vice President-Finance)
Date: May 12, 1995
------------
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<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 3,499
<ALLOWANCES> (95)
<INVENTORY> 4,706
<CURRENT-ASSETS> 8,193
<PP&E> 8,220
<DEPRECIATION> (5,598)
<TOTAL-ASSETS> 12,387
<CURRENT-LIABILITIES> 3,360
<BONDS> 2,073
<COMMON> 2,077
0
0
<OTHER-SE> 4,255
<TOTAL-LIABILITY-AND-EQUITY> 12,387
<SALES> 4,827
<TOTAL-REVENUES> 4,834
<CGS> 3,545
<TOTAL-COSTS> 891
<OTHER-EXPENSES> 49
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 76
<INCOME-PRETAX> 273
<INCOME-TAX> 59
<INCOME-CONTINUING> 214
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 214
<EPS-PRIMARY> .41
<EPS-DILUTED> .41
</TABLE>
