SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
/X/ QUARTERLY REPORT pursuant to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
For the quarterly period ended March 31, 1997 or
______________
/ / TRANSITION REPORT pursuant to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
For the transition from to
Commission File Number 1-9788
______
LANDAUER, INC.
--------------------------
(Exact name of registrant as specified in its charter)
Delaware 06-1218089
------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
2 Science Road, Glenwood, Illinois 60425
------------------------------------------
(Address of principal executive offices and Zip Code)
Registrant's telephone number, including area code (708) 755-7000
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 May 13, 1997
--------------------------- ----------------------------
Common stock, $.10 par value 8,482,285
PART I. FINANCIAL INFORMATION
LANDAUER, INC.
Balance Sheets
(000's)
ASSETS
______
<TABLE>
<CAPTION>
March 31, Sept. 30,
1997 1996
----------- ----------
derived from
(unaudited)(audited statements)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 4,043 $ 3,359
Short-term investments 4,450 7,885
Accounts receivable
less allowances of
$134,000 at 3/31/97
and $161,000 at 9/30/96 8,643 7,545
Inventories 1,196 879
Prepaid expenses 125 152
Deferred taxes on income 1,499 1,499
------- -------
Total current assets 19,956 21,319
Property, plant and equipment, 19,001 18,065
at cost Less: Accumulated
depreciation and amortization 11,132 10,340
-------- --------
Net property, plant and equipment 7,869 7,725
Investment in U.S. Treasury Securities 4,976 2,936
Cost of purchased businesses in excess
of net assets acquired 2,696 2,779
Equity in Japanese joint venture 3,640 4,069
Other assets 3,020 2,775
--------- ---------
$ 42,157 $ 41,603
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
LANDAUER, INC.
Balance Sheets (Cont'd.)
(000's)
LIABILITIES AND STOCKHOLDERS' INVESTMENT
________________________________________
<TABLE>
<CAPTION>
March 31, Sept. 30,
1997 1996
--------- ---------
derived from
(unaudited)(audited statements)
<S> <C> <C>
Current liabilities:
Accounts payable $ 405 $ 422
Deferred contract revenue 8,338 8,375
Dividend payable 2,543 2,331
Accrued compensation and related costs
1,111 1,235
Accrued pension costs 1,070 1,265
Accrued expenses 2,042 1,335
Accrued taxes on income 1,299 1,781
------- --------
Total current liabilities 16,808 16,744
------- --------
Stockholders' investment:
Preferred stock, $.10 par value per share -
Authorized - 1,000,000 shares
Outstanding - None -- --
Common stock, $.10 par value per share -
Authorized - 20,000,000 shares
Outstanding - 8,477,285 shares 848 848
Premium paid in on common stock 7,705 7,642
Cumulative translation adjustments (197) 238
Retained earnings 16,993 16,131
-------- --------
Total stockholders' investment 25,349 24,859
-------- --------
$ 42,157 $ 41,603
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
LANDAUER, INC.
Statements of Income
(000's, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
----------------------- ------------------
March 31, March 31, March 31, March 31,
1997 1996 1997 1996
-------- ------ ------ -------
<S> <C> <C> <C> <C>
Net revenues $ 10,441 $ 9,492 $ 19,588 $ 18,178
Costs and expenses:
Cost of revenues 3,003 2,733 5,895 5,416
Selling, general and
administrative 2,800 2,557 5,137 4,939
------ ------ ------ ------
5,803 5,290 11,032 10,355
------ ------ ------ ------
Operating income 4,638 4,202 8,556 7,823
Other income, net 383 408 757 803
------ ------ ------ ------
Income before income taxes 5,021 4,610 9,313 8,626
Income tax provision 1,838 1,708 3,365 3,218
------ ------ ------- -------
Net income $ 3,183 $ 2,902 $ 5,948 $ 5,408
======== ======== ======== ========
Net income per share $ .37 $ .34 $ .70 $ .64
======== ======== ======== ========
Average shares outstanding 8,477 8,477 8,477 8,477
======== ======== ======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
LANDAUER, INC.
Statements of Cash Flows
(000's)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
-----------------------
March 31, March 31,
1997 1996
--------- ---------
<S> <C> <C>
Net cash flow from operating activities:
Net income $ 5,948 $ 5,408
Adjustments to reconcile net income
to net cash from operating activities:
Depreciation and amortization 1,286 1,263
Equity in net income of foreign affiliate (371) (489)
Compensatory effect of stock options 63 35
Increase in accounts receivable (1,089) (952)
Decrease (increase) in inventories (317) 15
Decrease in prepaid expenses 27 140
Increase in accounts payable (17) (234)
Decrease (increase) in deferred contract revenue(37) 220
Increase in accrued expenses (94) (497)
Net increase in other
non-current assets (656) (263)
------- -------
Net cash generated
from operating activities 4,743 4,646
Cash flow used by investing activities:
Purchases of U.S. Treasury Securities (6,947) (3,004)
Maturities of U.S. Treasury Securities 8,342 5,500
Acquisition of property, plant,
and equipment (936) (794)
------- --------
Net cash generated from
investing activities 459 1,702
Cash flow from financing activities:
Dividend received from foreign affiliate 356 386
Dividends paid (4,874) (4,451)
-------- --------
Net cash used by financing activities (4,518) (4,065)
-------- --------
Net increase in cash 684 2,283
Opening balance - cash and cash equivalents 3,359 1,915
-------- --------
Ending balance - cash and cash equivalents $ 4,043 $ 4,198
======== ========
Supplemental Disclosure of Cash Flow
Information:
Cash paid for income taxes $ 3,399 $ 4,157
======== ========
Supplemental Disclosure of Non-cash
Financing Activity: Dividend declared $ 2,543 $ 2,331
Foreign currency translation adjustment $ (435) $ (304)
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
LANDAUER, INC.
Notes to Financial Statements - March 31, 1997
(Unaudited)
(1) Basis of Presentation
_____________________
The accompanying unaudited condensed financial statements
reflect the financial position of Landauer, Inc. ("Landauer") as
of March 31, 1997 and September 30, 1996, the results of
operations for the three-month and six-month periods ended March
31, 1997 and 1996 and cash flows for the six-month periods ended
March 31, 1997 and 1996. In the opinion of management, the
accompanying unaudited condensed financial statements contain all
adjustments necessary to present fairly the financial position of
Landauer as of March 31, 1997 and September 30, 1996, and the
results of operations for the three-month and six-month periods
ended March 31, 1997 and 1996, and cash flows for the six-month
periods ended March 31, 1997 and 1996.
The accounting policies followed by the Company are set
forth in Note 1 to the Company's financial statements in the 1996
Landauer Annual Report on Form 10-K, which is incorporated by
reference.
The results of operations for the three-month and six-month
periods ended March 31, 1997 and 1996 are not necessarily
indicative of the results to be expected for the full year.
(2) Cash Dividends
______________
On March 7, 1997, the Company declared a regular quarterly
cash dividend in the amount of $.30 per share payable on April 4,
1997, to stockholders of record on March 21, 1997. On November
7, 1996, the Company declared a regular quarterly cash dividend
in the amount of $.30 per share payable on January 9, 1997, to
stockholders of record on December 27, 1996.
Regular quarterly cash dividends of $.275 per share ($1.10
annually) were declared during fiscal 1996.
Management's Discussion and Analysis of Financial Condition
and Results of Operations
Liquidity and Capital Resources
_______________________________
Landauer s cash flow from operating activities for the six
months ended March 31, 1997 and 1996 amounted to $4,743,000 and
$4,646,000, respectively. Investing activities for the first
half of fiscal 1997 and 1996 resulted in a net decrease in
investments in principally U.S. Treasury securities of $1,395,000
and $2,496,000, respectively. Offsetting these were acquisitions
of property, plant and equipment in the amount of $936,000 and
$794,000, respectively. The Company s financing activities were
limited to payments of cash dividends, offset by foreign
dividends received from Nagase-Landauer, Ltd., our Japanese joint
venture.
LANDAUER, INC.
Management's Discussion and Analysis of Financial Condition
and Results of Operations (Cont d.)
The Company has no long-term liabilities and its requirement
for cash flow to support investing activities is generally
limited. Capital expenditures for the balance of fiscal 1997 are
expected to amount to approximately $1,500,000, principally for
computer hardware, the development of software systems, and the
acquisition of equipment to support growth and technology
enhancements. The Company anticipates that funds for these
capital improvements will be provided from operations.
The Company presently maintains no external sources of
liquidity, and, in the opinion of management, resources are
adequate for projected operations and capital spending programs,
as well as continuation of the regular cash dividend program.
Landauer requires limited working capital for its operations
since many of its customers pay for services in advance. Such
advance payments amounted to $8,338,000 and $8,375,000,
respectively, as of March 31, 1997 and September 30, 1996, and
are included in deferred contract revenue. While these amounts
represent approximately one-half of current liabilities, such
amounts do not represent a cash requirement.
Results of Operations
_____________________
Revenues for the quarter ended March 31, 1997 were 10%
higher compared with the same quarter a year ago. The increase
in revenues was attributable to gains in the Company s
traditional radiation dosimetry business and growth in radon
protection plan services. Gross margins were 71.2% of the
revenues for the second quarter of fiscal 1997 and fiscal 1996.
Selling, general and administrative expenses were slightly
lower for the current quarter as a percent of revenues at 26.8%
compared to 26.9% for the second quarter of fiscal 1997. As a
result, operating income for the second fiscal quarter of 1997
was 44.4% of revenues compared to 44.3% for the same period last
year. Income before income taxes was 48.1% of the revenues for
the quarter just ended compared to 48.6% for the second fiscal
quarter of 1996.
The effective tax rate for the Company during the second
quarter of fiscal 1997 was 36.6% compared with 37.0% for the same
period last year. Resulting net income of $3,183,000 for the
second fiscal quarter of 1997 was almost 10% higher than
$2,902,000 reported in fiscal 1996. Income per share for the
quarter was $.37 versus $.34 for the second fiscal quarter of
1996.
LANDAUER, INC.
Management's Discussion and Analysis of Financial Condition
and Results of Operations (Cont d.)
Revenues for the six months ended March 31, 1997, were 8%
higher compared with the first six months of fiscal 1996. The
increase in revenues was attributable to gains in the Company s
traditional radiation dosimetry business and growth in radon
protection plan services. Gross margins for the first half of
fiscal 1997 were 69.9% of revenues compared with 70.2% a year
ago. The decrease in gross margins was principally attributable
to expected overhead costs associated with increased radon
protection plan services activities compared with a year ago.
Selling, general, and administrative expenses were lower for
the first half of fiscal 1997 as a percent of revenues at 26.2%
compared to 27.2% for the first half of fiscal 1996 reflecting a
moderate rate of growth in operating expenses relative to revenue
growth. Operating income for the first half of fiscal 1997 was
43.7% of revenues compared with 43.0% for the same period last
year. Income before income taxes was 47.5% of revenues for the
six months just ended which is comparable to the same period in
fiscal 1996.
The effective tax rate for the Company during the first half
of fiscal 1997 was 36.1% compared with 37.3% a year ago.
Resulting net income of $5,948,000 for the first six months of
1997 was 10% higher than $5,408,000 reported in fiscal 1996.
Income per share thus far in fiscal 1997 was $.70 versus $.64 for
the same period in fiscal 1996.
LANDAUER, INC.
March 31, 1997
PART II. OTHER INFORMATION
Item 2. Legal Proceedings
Landauer is involved in various legal proceedings but
believes that these matters will be resolved without a material
effect on its financial position.
Item 4. Submission of Matters to a Vote of Security Holders
___________________________________________________
At its Annual Meeting held on January 29, 1997, the
shareholders voted to re-elect Thomas M. Fulton, Paul B.
Rosenberg, and Herbert Roth Jr. as directors for three-year terms
and voted to elect Robert J. Cronin and Richard R. Risk as new
directors for two-year terms. Voting for all nominees were
6,756,484 shares (representing 79.7% of total shares
outstanding), and votes for 46,177 shares were withheld from all
nominees. Continuing as directors are Gary D. Eppen, Marvin G.
Schorr, and Michael D. Winfield.
Shareholders voted to approve the 1997 Non-Employee
Directors Stock Option Plan with 6,051,200 shares (representing
71.3% of total shares outstanding) voting for the proposal,
307,486 against, and 277,711 abstaining.
The shareholders also voted to reappoint Arthur Andersen LLP
as the Company s auditors for the following year, with 6,715,146
shares (79.2% of total shares outstanding) voting for, 7,036
shares against, and 19,977 shares abstaining.
Item 6. Exhibits and Reports on Form 8-K
(a) No exhibits are filed with this report.
(b) There were no reports on Form 8-K during the quarter
for which this report is filed.
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.
LANDAUER, INC.
Date: May 13, 1997
/s/ James M. O Connell
_______________________________
James M. O'Connell
Vice President and Treasurer
(Principal Financial and
Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000825410
<NAME> LANDAUER, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> MAR-31-1997
<CASH> 4,043
<SECURITIES> 4,450
<RECEIVABLES> 8,777
<ALLOWANCES> 134
<INVENTORY> 1,196
<CURRENT-ASSETS> 19,956
<PP&E> 19,001
<DEPRECIATION> 11,132
<TOTAL-ASSETS> 42,157
<CURRENT-LIABILITIES> 16,808
<BONDS> 0
<COMMON> 848
0
0
<OTHER-SE> 24,501
<TOTAL-LIABILITY-AND-EQUITY> 42,157
<SALES> 19,588
<TOTAL-REVENUES> 19,588
<CGS> 5,895
<TOTAL-COSTS> 5,895
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 9,313
<INCOME-TAX> 3,365
<INCOME-CONTINUING> 5,948
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,948
<EPS-PRIMARY> .70
<EPS-DILUTED> .70
</TABLE>
