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 January 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: 6,061,698
<PAGE>
PART I. FINANCIAL INFORMATION
<PAGE>
GEORGE RISK INDUSTRIES, INC.
Balance Sheet
January 31, 1997
[CAPTION]
[S] [C]
ASSETS
Current Assets
Cash $ 1,166,000
Marketable securities 3,177,000
Accounts receivable:
Trade, net of $50,000 doubtful
account allowance 903,000
Officers and employees 1,000
Inventories (Note 1) 1,581,000
Prepaid expenses 127,000
Deferred income taxes 52,000
___________
Total current assets 7,007,000
Property And Equipment, Net, At Cost 704,000
Other Assets 28,000
___________
TOTAL ASSETS $ 7,739,000
[CAPTION]
LIABILITIES AND STOCKHOLDERS EQUITY
[S] [C]
Current Liabilities
Accounts payable, trade $ 160,000
Notes payable, current portion 76,000
Accrued expenses 508,000
___________
Total current liabilities 744,000
Long term Liabilities
Notes payable, FKI, Inc. 189,000
Deferred Income Taxes 27,000
___________
Total long term liabilities 216,000
Stockholders Equity
Convertible preferred stock 257,000
Common stock, Class A 850,000
Additional paid-in capital 1,644,000
Retained earnings 4,594,000
Less cost of treasury stock (566,000)
___________
Total stockholders equity 6,779,000
___________
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY $ 7,739,000
[FN]
See Accompanying Notes to Financial Statements
<PAGE>
<TABLE>
GEORGE RISK INDUSTRIES INC.
STATEMENTS OF INCOME
(unaudited)
<CAPTION>
for three months for nine months
ended ended
Jan.31 Jan.31
1997 1996 1997 1996
_______________________ _________________________
<S> <C> <C> <C> <C>
Net sales $2,525,000 $2,108,000 $8,177,000 $7,032,000
Less cost of
goods sold 1,316,000 1,045,000 4,342,000 3,547,000
_______________________ _________________________
Gross profit $1,209,000 $1,063,000 $3,835,000 $3,485,000
Operating expenses
G&A 148,000 134,000 427,000 460,000
Sales 540,000 427,000 1,586,000 1,471,000
Engineering 4,000 17,000 8,000 45,000
_______________________ _________________________
$ 692,000 $ 578,000 $2,021,000 $1,976,000
Income from
operations 517,000 485,000 1,814,000 1,509,000
Other income
(expenses)
Interest income 52,000 34,000 147,000 118,000
Interest expense (30,000) (5,000) (47,000) (6,000)
_______________________ _________________________
$ 22,000 $ 29,000 $ 100,000 $ 112,000
Income before prov-
ision for income
tax $ 539,000 $ 514,000 $1,914,000 $1,621,000
Provision for income
tax
Current expense 119,000 228,000 696,000 739,000
_______________________ _________________________
Net Income $ 420,000 $ 286,000 $1,218,000 $ 882,000
Net income per
common share $ .069 $ 0.05 .20 .14
Weighted average
number of common
shares out-
standing 6,061,698 6,095,397 6,061,698 6,266,408
<FN>
See Accompanying Notes To Financial Statements
</TABLE>
<PAGE>
GEORGE RISK INDUSTRIES, INC
Statements of Cash Flows
For The Nine Months Ended January 31, 1997 and 1996
[CAPTION] 1997 1996
___________________________
[S] [C] [C]
Cash Flow From Operating
Activities:
Net income $1,218,000 $ 882,000
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Depreciation 85,000 47,000
Changes in assets
and liabilities:
(Increase) decrease
in:
Accounts receivable 66,000 89,000
Note Receivable 1,000 (3,000)
Inventories (111,000) (383,000)
Prepaid expenses 42,000 (15,000)
Increase (decrease)
in:
Accounts payable 101,000 120,000
Accrued expenses 53,000 (132,000)
Notes payable (56,000) 448,000
Income tax payable 87,000 63,000
Class II deferred 0 (20,000)
Net cash provided by (used in) _________ __________
operating activities 1,486,000 1,096,000
Cash Flows From Investing
Activities:
(Purchase) sale of property
and equipment (189,000) (130,000)
(Purchase) sale of
marketable securities (1,038,000) (382,000)
Net cash provided by (used in) __________ __________
investing activities (1,227,000) (512,000)
Cash Flows From Financing
Activities:
(Purchase) of treasury
stock 0 (576,000)
Net cash provided by (used in) __________ __________
financing activities 0 (576,000)
Net increase (decrease) in
cash $ 259,000 $ 8,000
Cash at beginning
of period $ 907,000 $ 479,000
Cash at end of period $1,166,000 $ 487,000
<PAGE>
GEORGE RISK INDUSTRIES, INC
NOTES TO FINANCIAL STATEMENTS
January 31, 1997
Note 1. Inventories
At January 31, 1997, and October 31, 1996, respectively,
inventories consisted of the following:
Raw materials $ 1,081,000 $ 943,000
Work in process 213,000 162,000
Finished goods 333,000 222,000
___________ ___________
1,627,000 1,327,000
___________ ___________
Less allowance for obsolete
inventory <46,000> <46,000>
___________ ___________
Totals $ 1,581,000 $ 1,281,000
<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, 1996.
Net cash decreased $123,000 during the quarter ended January 31,
1997 as compared to a decrease of $362,000 during the corresponding
quarter last year. Inventories increased $301,000 during the
current quarter and increased $174,000 during the quarter ended
January 31, 1996. For the nine months ended January 31, 1997,
inventories have increased $111,000 as compared to an increase of
$383,000 during the corresponding nine months last year. Prepaid
expenses have decreased $42,000 during the nine months ended
January 31, 1997 and prepaid expenses increased $150,000 during
the nine months ended January 31, 1996. The total value of the
Company's marketable securities increased $444,000 for the quarter
ended January 31, 1997 and $1,038,000 for the nine months ended
January 31, 1997. This compares to increases of $594,000 and
$382,000 for the corresponding periods last year. The Company
continues to invest excess cash in secure, interest bearing
bonds and securities. Purchases of property and equipment in-
creased $33,000 during the three months ended January 31, 1997.
These asset additions include an Artos wire machine with a cost
of $15,000, a welder and several new molds.
Working capital at January 31, 1997 was $6,263,000 as compared
to $4,810,000 at January 31, 1996. The current ratio for the
period ended January 31, 1997 was 9.42 and 9.25 at January 31,
1996. The acid test ratio was 7.05 at January 31, 1997 and
5.78 at January 31, 1996. Accounts receivable collections
have averaged $800,000 per month during the current quarter
and the accounts receivable turnover was 2.52 for both the
current quarter and the corresponding quarter last year.
Net sales were $2,525,000 for the quarter ended January 31,
1997 as compared to $2,108,000 for the same quarter last year;
or a 20% increase. For the nine months ended January 31, 1997,
net sales increased 16.2%, from $7,032,000 last year to
$8,177,000 this year. The Company continues to acquire new
customers and also increase the sales volume of existing cus-
tomers. The security products segment currently accounts for
90% of total sales.
Operating expenses were 27% of net sales for the quarter ended
January 31, 1997 as compared to 26% for the same quarter last
year. Advertising expenses are up slightly over last year as
well as wage expenses for hourly clerical employees. Both of
these increases are reflected in the 1% increase in operating
expenses.
<PAGE>
Cost of goods sold has increased from 50% of sales at January
31, 1996 to 53% at January 31, 1997. Management is beginning
to see the increase in labor costs associated with two signif-
icant hourly wage increases in July and September of this
fiscal year. Because of a change in accounting for vacation
time due for long-term salaried employees, we have increased
vacation expense this fiscal year that past year's comparatives
do not reflect.
Other income totaled $147,000 for the nine months ended January
31, 1997 as compared to $118,000 for the nine months ended
January 31, 1996. Interest expense for the nine months this
year was $47,000 as compared to $6,000 for the same period last
year. Interest expense is comprised of imputed interest on
the FKI,Inc. and W.A. Richardson notes payable. Other income
includes interest and dividend income on the Company's invest-
ments.
The current income tax expense decreased from $228,000 during
the quarter ended January 31, 1996 to $119,000 for the quarter
ended January 31, 1997. This is due to an adjustment that was
made because of the prior year's overpayment which had to be
credited to this year's current tax expense. This adjustment
was made during the current quarter after the Company's tax
return was filed.
The Company continues to operate it's satellite plant in Gering,
NE with employment at that site currently at 20 people. The
main facility currently employs 250 for a total of 270 employees.
Management expects to see sales continue to increase during
the fourth quarter and expects employment to to remain at
270-275 employees. The Company is researching new areas of
product development and looking forward to expanding existing
product lines also. The search for a business acquisition
continues and management actively prsues different avenues of
opportunity in relation to manufacturing automation and equip-
ment upgrading.
<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 January 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 01-31-97 Ken R. Risk
Ken R. Risk, Director
Date 01-31-97 Eileen M. Risk
Eileen M. Risk, Director
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> APR-30-1997
<PERIOD-START> MAY-01-1996
<PERIOD-END> JAN-31-1997
<CASH> 1166
<SECURITIES> 3177
<RECEIVABLES> 954
<ALLOWANCES> 50
<INVENTORY> 1581
<CURRENT-ASSETS> 7007
<PP&E> 1495
<DEPRECIATION> 791
<TOTAL-ASSETS> 7739
<CURRENT-LIABILITIES> 744
<BONDS> 0
<COMMON> 850
0
257
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 7739
<SALES> 8177
<TOTAL-REVENUES> 8177
<CGS> 4342
<TOTAL-COSTS> 4342
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 47
<INCOME-PRETAX> 1914
<INCOME-TAX> 696
<INCOME-CONTINUING> 1218
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1218
<EPS-PRIMARY> .20
<EPS-DILUTED> .20
</TABLE>
