UNITED STATES
SECURITES AND EXCHANGE COMMISSION
Washington, DC 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 July 31, 1998
[ ] Transition report under Section 13 or 15(d) ot 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)
n/a
(Former name, address and fiscal year, if changed from 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 [ ] No [x]
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:
<PAGE>
PART I. FINANCIAL INFORMATION
<PAGE>
GEORGE RISK INDUSTRIES, INC.
BALANCE SHEET
JULY 31, 1998 AND 1997
[CAPTION]
[S] [C] [C]
ASSETS
CURRENT ASSETS
Cash $ 710,000 $ 883,000
Marketable Securities 4,821,000 3,862,000
Accounts Receivable:Trade Net of $50,000
Doubtful Accounts Allowance 1,921,000 1,150,000
Officers and Employees 3,000 2,000
Inventories 2,126,000 1,619,000
Notes Receivable 11,000 65,000
Prepaid Expenses 104,000 106,000
Deferred Income Taxes 31,000 94,000
------------ ------------
Total Current Assets $ 9,685,000 $ 7,781,000
Property, Plant and Equipment, Net at
Cost 642,000 671,000
Other Assets 265,000 63,000
------------ ------------
Total Assets $10,592,000 $ 8,515,000
============ ============
[CAPTION]
LIABILITIES AND STOCKHOLDER'S EQUITY
[S] [C] [C]
CURRENT LIABILITIES
Accounts Payable, Trade $ 239,000 $ 90,000
Notes Payable 52,000 46,000
Accrued Expenses 526,000 523,000
------------ ------------
Total Current Liabilities $ 817,000 $ 659,000
LONG-TERM LIABILITIES
Deferred Taxes 33,000 34,000
Notes Payable 144,000 197,000
------------ ------------
Total Long-Term Liabilities $ 177,000 $ 231,000
STOCKHOLDER'S EQUITY
Preferred Stock 257,000 257,000
Common Stock, Class "A" 850,000 850,000
Additional Paid-In Capital 1,674,000 1,674,000
Retained Earnings 7,468,000 5,400,000
Less: Cost of Treasury Stock (651,000) (556,000)
------------ ------------
Total Stockholder's Equity $ 9,598,000 $ 7,625,000
------------ ------------
Total Liabilities and Stockholder's Equity $10,592,000 $ 8,515,000
============ ============
<PAGE>
<TABLE>
GEORGE RISK INDUSTRIES, INC.
Statement of Income
For the three months ended
July 31, 1998 July 31, 1997
<S> <C> <C>
Net Sales $ 2,905,000 $ 2,551,000
Less: Cost of Goods Sold (1,529,000) (1,379,000)
------------ ------------
Gross Profit $ 1,376,000 $ 1,172,000
Operating Expenses:
General and Administrative 147,000 154,000
Sales 444,000 413,000
Engineering 27,000 22,000
------------ ------------
Total Operating Expenses $ 618,000 $ 589,000
Income From Operations 758,000 583,000
Other Income (Expense)
Interest Income 6,000 11,000
Interest Expense (6,000) (8,000)
Other Income 57,000 47,000
------------ ------------
$ 57,000 $ 51,000
Income Before Provision
For Income Taxes 815,000 634,000
Provision For Income Taxes
Current Portion (286,000) (280,000)
------------ ------------
Net Income $ 529,000 $ 354,000
============ ============
Income Per Share of
Common Stock $ .09 $ .06
Weighted Average Number of
Common Shares Outstanding 6,059,108 6,087,343
</TABLE>
<PAGE>
GEORGE RISK INDUSTIES, INC.
Statement of Cash Flows
(unaudited)
[CAPTION]
for the three months ended
July 31
1998 1997
---------------------------
[S] [C] [C]
Cash Flow from Operating Activities:
Net Income $ 529,000 $ 354,000
Adjustemnt to reconcile net income to
cash provided by operating activities:
Depreciation 27,000 30,000
Changes in assets and liabilities:
(Increase) Decrease:
Accounts Receivable (151,000) 125,000
Other Receivables (1,000) 0
Notes Receivable 4,000 0
Inventories (471,000) 58,000
Prepaid Expenses (18,000) (38,000)
Other Assets (19,000) (11,000)
Increase (Decrease)
Accounts Payable 43,000 (106,000)
Accrued Expenses (132,000) (48,000)
Notes Payable (12,000) (11,000)
Income Tax Payable 286,000 280,000
----------- -----------
Net Cash Provided by (Used in)
Operating Activities $ 85,000 $ 624,000
Cash Flow from Investing Activities:
(Purchase) Sale of Property and Equipment (5,000) (20,000)
(Purchase) Sale of Marketable Securities (239,000) (374,000)
----------- -----------
Net Cash Provided by (Used in)
Investing Activities $ (244,000) $ (394,000)
Net Increase (Decrease) in Cash $ (193,000) $ 239,000
Cash at Beginning of Period $ 903,000 $ 653,000
Cast at End of Period $ 710,000 $ 892,000
<PAGE>
GEORGE RISK INDUSTRIES, INC.
Statement of Comprehensive Income
For the three months ended July 31, 1998 and 1997
[S] [C] [C]
Net Income $ 529,000 $ 354,000
----------- -----------
Other Comprehensive Income,
Net of Tax
Unrealized gain (loss) on securities:
Unrealized holding gains (losses)
arising during period 99,000 56,000
Less: Reclassification adjustment for
losses included in net income 6,000 8,000
----------- -----------
Other Comprehensive Income $ 105,000 $ 64,000
Comprehensive Income $ 634,000 $ 418,000
=========== ===========
<PAGE>
GEORGE RISK INDUSTRIES, INC.
NOTES TO FINANCIAL STATEMENTS
JULY 31, 1998
Note 1. Inventories
At July 31, 1998 and July 31, 1997, respectively, inventories
consisted of the following:
Raw Materials $ 1,428,000 $ 1,084,000
Work in Process 301,000 300,000
Finished Goods 443,000 281,000
------------ ------------
Less: Allowance for obsolete inventory (46,000) (46,000)
------------ ------------
Total Inventory $ 2,126,000 $ 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, 1998.
Net cash decreased $194,000 during the quarter ended July 31, 1998 as
compared to an increase of $230,000 during the corresponding quarter last
year. Inventories increased $471,000 during the current quarter as com-
pared to a $58,000 decrease last year. The finished goods inventory
increased as the Company was able to utilize the sub assembly operation
in Gering to build for stock as well as for the increased orders. The
Company was also able to take advantage of cost savings on quantity pur-
chases of raw materials. Accounts receivable decreased $151,000 during
the current quarter. The Company continues to collect its accounts within
terms with 93% of the total receivables considered current at less than
45 days and only 4% of the total 90 days past due. Operating expenses
were 21% of net sales for the quarter ended July 31, 1998, down from 23%
for the same period last year. Net cash used in investing activities de-
creased from $394,000 last year to $244,000 for the current quarter.
Purchases of marketable securities were down $135,000 from the comparable
quarter last year. Income tax expense increased $286,000 this current
first quarter compared to $280,000 last year. Although income before
taxes increased $181,000, the tax expense reflects a book adjustment dur-
ing the current quarter for over accruals of tax expense for the fiscal
year ended April 30, 1998. As a percent of sales, cost of goods sold
remained at 53% for the current quarter and was 54% for the first quarter
last year.
Working capital at July 31, 1998 was $8,868,000 as compared to $7,122,000
at July 31, 1997. The current ratio was 11.85 and 11.81 for the quarters
1998 and 1997. The acid test ratio was 9.12 at July 31, 1998 and 8.95 at
July 31, 1997. Cash per share (including marketable securities) was $0.91
and equity per share was $1.58 at July 31, 1998. Net income increased 49%
for the three months compared tothe three months ended July 31, 1997, with
sales increasing 14% over the first quarter last year. The Company
continues to keep labor costs in line and closely monitors all operating
expenses.
The Company recognizes its revenues when goods are shipped and billed to
its cumstomers. There is a $50,000 allowance that was established by the
Company to account for any uncolletable accounts.
In 1997, the Financial Accounting Standards Board issued SFAS No. 131,
"Disclosure about Segments of an Enterprise and Related Information",
which changes the way public companies report information about their
business segments. Although the Company does have two distinct business
segments, security alarm products and keyboard products, the keyboard
line is less than 10% of the total sales and therefore is not required to
be recognized as a separate segment.
The Company announced plans for a 7,200 ft. expansion of its main
production facility with the total project cost estimated at $200,000.
Federal funds made available through a Community Development grant have
been awarded for a portion of the expense. GRI has committed to the cre-
ation of additional jobs and continued employment levels as a provision of
the grant as well as capital equipment purchases. Construction is
expected to begin in March 1999.
<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 filed during the quarter
ended July 31, 1998
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the
registrant caused this report to be signed on its behalf by the under-
signed, thereunto duly authorized.
George Risk Industries, Inc.
(Registrant)
Date 04-23-99 Ken R. Risk
Ken R. Risk, Director
Date 04-23-99 Eileen M. Risk
Eileen M. Risk, Director
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> APR-30-1999
<PERIOD-START> MAY-01-1998
<PERIOD-END> JUL-31-1998
<CASH> 709
<SECURITIES> 4822
<RECEIVABLES> 1971
<ALLOWANCES> 50
<INVENTORY> 2126
<CURRENT-ASSETS> 9685
<PP&E> 1544
<DEPRECIATION> 902
<TOTAL-ASSETS> 10593
<CURRENT-LIABILITIES> 817
<BONDS> 0
<COMMON> 850
0
257
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 10593
<SALES> 2905
<TOTAL-REVENUES> 2905
<CGS> 1529
<TOTAL-COSTS> 1529
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6
<INCOME-PRETAX> 815
<INCOME-TAX> 286
<INCOME-CONTINUING> 529
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 529
<EPS-PRIMARY> .09
<EPS-DILUTED> .09
</TABLE>
