UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[x] Quarterly Report under Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarter ended October 31, 1997
[ ] Transition report under Section 13 or 15(d) of the
Exchange Act.
For the transition period from _____to _____
Commission file number 0-5378
GEORGE RISK INDUSTRIES, INC.
(Exact name of small business issuer as
specified in its charter)
Colorado 84-0524756
(State or other jurisdiction (IRS employers
of incorporation or organization) identification No.)
802 South Elm, Kimball, NE 69145
(Address of principal executive offices)
(308)-235-4645
(Issuer's telephone number)
n/a
(Former name, address and fiscal year, if changed since
last report)
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 [ ]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the
Exchange Act after the distribution of securities under a
plan confirmed by a court.
Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the
issuer's classes of common equity, as of the latest
practicable date: 6,087,343
<PAGE>
PART I. FINANCIAL INFORMATION
<PAGE>
GEORGE RISK INDUSTRIES, INC.
Balance Sheet
October 31, 1997
[CAPTION]
[S] [C]
ASSETS
Current Assets
Cash $ 655,000
Marketable securities 4,298,000
Accounts receivable:
Trade, net of $50,000 doubtful
account allowance 1,453,000
Notes Receivable 65,000
Inventories (Note 1) 1,342,000
Prepaid expenses 54,000
___________
Total current assets 7,867,000
Property And Equipment, Net, At Cost 660,000
Other Assets 140,000
___________
TOTAL ASSETS $ 8,667,000
[CAPTION]
LIABILITIES AND STOCKHOLDERS EQUITY
[S] [C]
Current Liabilities
Accounts payable, trade $ 158,000
Notes payable, current portion 46,000
Accrued expenses 377,000
Deferred current taxes <94,000>
___________
Total current liabilities 487,000
Long term Liabilities
Notes payable, FKI, Inc. 186,000
Deferred Income Taxes 34,000
___________
Total long term liabilities 220,000
Stockholders Equity
Convertible preferred stock 257,000
Common stock, Class A 850,000
Additional paid-in capital 1,674,000
Retained earnings 5,735,000
Less cost of treasury stock (556,000)
___________
Total stockholders equity 7,960,000
___________
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY $ 8,667,000
[FN]
See Accompanying Notes to Financial Statements
<PAGE>
<TABLE>
GEORGE RISK INDUSTRIES INC.
STATEMENTS OF INCOME
(unaudited)
<CAPTION>
for three months for six months
ended ended
October 31 October 31
1997 1996 1997 1996
_______________________ _______________________
<S> <C> <C> <C> <C>
Net sales $3,007,000 $2,936,000 $5,559,000 $5,652,000
Less cost of
goods sold 1,644,000 1,597,000 3,024,000 3,026,000
_______________________ ________________________
Gross profit $1,363,000 $1,339,000 $2,535,000 $2,626,000
Operating expenses
G&A 147,000 140,000 302,000 279,000
Sales 630,000 577,000 1,043,000 1,046,000
Engineering 21,000 3,000 43,000 4,000
_______________________ ________________________
$ 798,000 $ 720,000 $1,388,000 $1,329,000
Income from
operations 565,000 619,000 1,147,000 1,297,000
Other income
(expenses)
Interest income 74,000 43,000 128,000 95,000
Interest expense (7,000) (8,000) (14,000) (17,000)
Other income 46,000 51,000
_______________________ _________________________
$ 113,000 $ 35,000 $ 165,000 $ 78,000
Income before prov-
ision for income
tax $ 678,000 $ 654,000 $1,312,000 $1,375,000
Provision for income
tax
Current expense 291,000 274,000 571,000 577,000
_______________________ _________________________
Net Income $ 387,000 $ 380,000 $ 741,000 $ 798,000
Net income per
common share $ .06 $ 0.06 $ .12 .13
Weighted average
number of common
shares out-
standing 6,087,343 6,061,698 6,087,343 6,061,698
<FN>
See Accompanying Notes To Financial Statements
</TABLE>
<PAGE>
GEORGE RISK INDUSTRIES, INC
Statements of Cash Flows
For The Six Months Ended October 31,
[CAPTION] 1997 1996
___________________________
[S] [C] [C]
Cash Flow From Operating
Activities:
Net income $ 741,000 $ 798,000
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Depreciation 59,000 50,000
Changes in assets
and liabilities:
(Increase) decrease
in:
Accounts receivable (178,000) (130,000)
Note Receivable 1,000
Inventories 336,000 190,000
Prepaid expenses 13,000 61,000
Other assets (96,000)
Increase (decrease)
in:
Accounts payable (38,000) 66,000
Accrued expenses (17,000) (18,000)
Notes payable (23,000) (36,000)
Income tax payable 104,000 150,000
Net cash provided by (used in) _________ __________
operating activities 901,000 1,132,000
Cash Flows From Investing
Activities:
(Purchase) sale of property
and equipment (38,000) (156,000)
(Purchase) sale of
marketable securities (861,000) (594,000)
Net cash provided by (used in) __________ __________
investing activities (899,000) (750,000)
Net increase (decrease) in
cash $ 2,000 $ 382,000
Cash at beginning
of period $ 653,000 $ 907,000
Cash at end of period $ 655,000 $1,289,000
<PAGE>
GEORGE RISK INDUSTRIES, INC
NOTES TO FINANCIAL STATEMENTS
October 31, 1997
Note 1. Inventories
At October 31, 1997, and July 31, 1997, respectively,
inventories consisted of the following:
Raw materials $ 977,000 $ 1,084,000
Work in process 203,000 300,000
Finished goods 208,000 281,000
___________ ___________
1,388,000 1,665,000
___________ ___________
Less allowance for obsolete
inventory <46,000> <46,000>
___________ ___________
Totals $ 1,342,000 $ 1,619,000
<PAGE>
GEORGE RISK INDUSTRIES, INC
Part I. FINANCIAL INFORMATION
Item 2. Management Discussion and Analysis of
Financial Condition and Results of
Operations.
<PAGE>
MANAGEMENT DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with
the attached condensed consolidated financial statements, and
with the Company's audited financial statements and discussion
for the fiscal year ended April 30, 1997.
Net cash increased $2000 during the six months ended October
31, 1997 as compared to an increase of $382,000 during the
corresponding six month period last year. The Company in-
vested excess cash in marketable securities with those pur-
chases totalling $861,000 for the current six month period.
Last year the purchase of marketable securities for the six
months totalled $594,000 resulting in a 30% increase for the
period ended October 31, 1997 as compared to the same period
ended October 31, 1996. Other assets increased $96,000 for
the current six month period. This increase is comprised of
a $50,000 equipment deposit on a CNC Tooling machine that the
Company is purchasing. Once delivered and operating the total
cost, estimated at $55,000 will be capitalized. Other assets
also include current costs for new molds that are being built
by our own tool and die department but not yet complete. At
the time of completion these costs will also be capitalized.
Working capital at October 31, 1997 was $7,380,000 as compared
$5,829,000 at October 31, 1996. The current ratio was 16.15
for the current period and 9.3 for the same period last year.
The acid test ratio was 13.29 at October 31, 1997 and 7.28 at
October 31, 1996. The accounts receivable turnover was 2.31 at
October 31, 1997 and 2.7 at October 31, 1996.
Net sales decreased $93,000 for the six month period as compared
to the same period last year, but for the three months ended
October 31, 1997 sales increased $71,000 over the same three
months last year. This overall decrease in net sales occurred
during the first quarter and is expected to be recouped in the
subsequent months that remain in the current fiscal year.
<PAGE>
Operating expenses were 25% of net sales for the six months
ended October 31, 1997, up slightly from 24% for the corre-
sponding period last year.
Interest income increased $31,000 during the quarter ended
October 31, 1997 and increased $33,000 for the six month
period as compared to the quarter ended October 31, 1996 and
the six months ended October 31, 1996. This increase is due
to the interest bearing marketable securities that the Company
continues to invest in. Other income totalled $51,000 for the
six months. This is comprised of insurance reimbursements for
roof repairs that are being done at the present time but not
yet complete. Once complete this income will be offset by the
related expense.
The Company has agreed to extend the payment terms of its
largest customer to 60 days. Management does not expect this
agreement to compromise the operating cash flow as this cus-
tomer has always paid promptly within its terms.
The Company accepted, with regret, the resignation of its
Director of Engineering. He had been with the Company for 17
years and is leaving the area to pursue other ventures.
Management has filled the position and says the new Director
"brings with him a wealth of experience, enthusiasm and
knowledge that will further enable GRI to proceed into the year
2000 with confidence and bright expectations for the future".
Management has agreed to pursue a proposed 401(K) or other
qualified retirement plan for its employees. The options that
are available are being looked at and the proposed plan and
associated costs will be presented to management at a later
date.
Management continues to work with Paradigm Advanced Technologies
to solidify the relationship between the two companies. Currently
Paradigm is involved in negotiations with several multi-million
dollar firms that utilize its applications. Management of both
Companies predict that a short production run for testing pur-
poses may take place in the next 60 to 90 days.
<PAGE>
GEORGE RISK INDUSTRIES, INC.
Part II. OTHER INFORMATION
Item 1. Legal Proceedings n/a
Item 2. Changes in Securities n/a
Item 3. Defaults upon Senior Securities n/a
Item 4. Submission of Matters to a Vote
of Securities n/a
Item 5. Other Information n/a
Item 6. Exhibits and Reports on Form 8-K
A. Exhibits
Exhibit 27. Financial Data Schedule
B. Reports on Form 8-K
No 8-K reports were filed during the
quarter ended October 31, 1997
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act,
the registrant caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
George Risk Industries, Inc.
(Registrant)
Date 10-31-97 Ken R. Risk
Ken R. Risk, Director
Date 10-31-97 Eileen M. Risk
Eileen M. Risk, Director
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> APR-30-1998
<PERIOD-START> MAY-01-1997
<PERIOD-END> Oct-31-1997
<CASH> 655
<SECURITIES> 4298
<RECEIVABLES> 1503
<ALLOWANCES> 50
<INVENTORY> 1342
<CURRENT-ASSETS> 7867
<PP&E> 1470
<DEPRECIATION> 810
<TOTAL-ASSETS> 8667
<CURRENT-LIABILITIES> 487
<BONDS> 0
<COMMON> 850
0
257
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 8667
<SALES> 5634
<TOTAL-REVENUES> 5634
<CGS> 3024
<TOTAL-COSTS> 3024
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 14
<INCOME-PRETAX> 1312
<INCOME-TAX> 571
<INCOME-CONTINUING> 741
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 741
<EPS-PRIMARY> .12
<EPS-DILUTED> .12
</TABLE>
