<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A-1
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) June 9, 1997
-------------------------------
Armor Holdings, Inc.
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 0-18863 59-3392443
- -------------------------------------------------------------------------------
State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
13386 International Parkway, Jacksonville, Florida 32218
- -------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (904) 741-5400
-----------------------------
- -------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE>
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
In connection with the acquisition by Armor Holdings, Inc. (the
"Company") of 50% of the issued ordinary share capital of Gorandel Trading
Limited ("GTL") (the "GTL Acquisition"), the Company's Current Report on Form
8-K, filed on June 24, 1997, is hereby amended to include the following
financial statements and pro forma financial information, which were previously
omitted from such Current Report on Form 8-K.
(a) Financial Statements of Business Acquired.
The following financial statements for GTL, are submitted herewith:
<TABLE>
<CAPTION>
Page of Form 8-K/A-1
--------------------
<S> <C>
Independent Auditors' Report 3
Profit and loss account - For the period ended 31 December 1996 4
Balance sheet - 31 December 1996 5
Cash flow statement - For the period ended 31 December 1996 6
Reconciliation of movement in shareholders' funds - for the period ended
31 December 1996 7
Notes to financial statements 8
Independent Auditors' Report 11
Profit and loss accounts - 31 March 1996 and 1995 12
Balance sheets - 31 March 1996 and 1995 13
Cash flow statements - 31 March 1996 and 1995 14
Reconciliations of movements in shareholders' funds - 31 March 1996 and 1995 15
Notes to financial statements 16
The following unaudited interim financial information for GTL is submitted herewith:
Page of Form 8-K/A-1
--------------------
Unaudited consolidated profit and loss account - 31 March 1997 and 1996 19
Unaudited consolidated balance sheet - 31 March 1997 20
Unaudited consolidated cash flow statement - 31 March 1997 and 1996 21
Notes to unaudited interim financial statements 22
</TABLE>
<TABLE>
<CAPTION>
Page of Form 8-K/A-1
--------------------
<S> <C>
Unaudited pro forma income statement for the three months ended March 29, 1997 21
Unaudited pro forma income statement for the year ended December 28, 1996 22
Unaudited pro forma balance sheet - March 29, 1997 23
Notes to unaudited pro forma financial statements 24
</TABLE>
2
<PAGE>
GORANDEL TRADING LIMITED
FINANCIAL STATEMENTS
31 DECEMBER 1996
Independent Auditors' Report to the board of directors and shareholders of
Gorandel Trading Limited
We have audited the accompanying balance sheet of Gorandel Trading Limited
at 31 December 1996 and the related profit and loss account, reconciliation
of movements in shareholders' funds and cash flow statement for the period
from 1 April 1996 to 31 December 1996. These financial statements are the
responsibility of the management of Gorandel Trading Limited. Our responsibility
is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United Kingdom and in the United States of America. Those standards
require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Gorandel Trading Limited
at 31 December 1996 and the results of its operations and cash flows for the
period from 1 April 1996 to 31 December 1996, in conformity with International
Accounting Standards.
Accounting principles in International Accounting Standards vary in certain
significant respects from accounting principles generally accepted in the
United States of America. Application of accounting principles generally
accepted in the United States would have affected profit attributable to
shareholders for the period from 1 April to 31 December 1996 and
shareholders' funds at 31 December 1996, to the extent summarised in
note 9 to the financial statements.
KPMG 15 April 1997
Chartered Accountants
Registered Auditors
London
3
<PAGE>
GORANDEL TRADING LIMITED
PROFIT AND LOSS ACCOUNT
PERIOD FROM 1 APRIL 1996 TO 31 DECEMBER 1996
<TABLE>
<CAPTION>
PERIOD ENDED
31/12/1996
NOTE US$
<S> <C> <C>
Turnover 4 4,909,391
---------
Profit from operations 1,058,481
---------
Including charges in respect of:
Depreciation 17,757
Auditors' remuneration 5,000
Interest expense 78,565
---------
101,322
=========
Taxation 7 520,559
---------
Profit for the year after
taxation 537,922
Profit brought forward 1,759,358
---------
Profit carried forward 2,297,280
=========
</TABLE>
There were no other recognized gains and losses other then those shown above.
4
<PAGE>
GORANDEL TRADING LIMITED
BALANCE SHEET AS AT 31 DECEMBER 1996
<TABLE>
<CAPTION>
PERIOD ENDED
31/12/1996
NOTE US$
<S> <C> <C>
CURRENT ASSETS
Cash at bank 267,093
Debtors and prepayments 1,967,707
Shareholders' current account 238,372
Amounts due from related
companies 5 1,695,255
---------
4,168,427
---------
CURRENT LIABILITIES
Creditors 382,640
Amounts due to related company 855,867
Taxation payable 7 735,225
---------
1,973,732
---------
NET CURRENT ASSETS 2,194,695
FIXED ASSETS 6 104,525
---------
NET ASSETS 2,299,220
---------
CAPITAL AND RESERVES
Share capital 8 1,940
Profit and loss account 2,297,280
---------
2,299,220
---------
</TABLE>
5
<PAGE>
GORANDEL TRADING LIMITED
CASH FLOW STATEMENT
PERIOD FROM 1 APRIL 1996 TO 31 DECEMBER 1996
<TABLE>
<CAPTION>
PERIOD ENDED
31/12/1996
US$
<S> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net profit for the period before taxation 1,058,481
Adjusting for:
Depreciation 17,757
Interest receivable (3,737)
---------
Operating profit before working capital changes 1,072,501
Increase in debtors (540,686)
Decrease in deferred cost 24,330
Decrease in creditors (477,609)
Increase in shareholders' account (230,000)
---------
Cash generated from operations (151,464)
Taxation paid (54,679)
---------
Net cash from operating activities (206,143)
---------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets (37,435)
Interest received 3,737
---------
Net cash used in investing activities (33,698)
---------
CASH FLOWS FROM FINANCING ACTIVITIES
Amounts due to related companies (11,777)
---------
Net cash used in financing activities (11,777)
---------
Net decrease in cash and cash equivalents (251,618)
Cash and cash equivalents at beginning of
period 518,711
---------
Cash and cash equivalents at end of period 267,093
---------
Cash and cash equivalents are defined by:
Cash at bank and in hand 267,093
=========
</TABLE>
6
<PAGE>
GORANDEL TRADING LIMITED
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
PERIOD FROM 1 APRIL 1996 TO 31 DECEMBER 1996
<TABLE>
<CAPTION>
PERIOD ENDED
31 DECEMBER 1996
US$
<S> <C>
Opening shareholders' funds 1,761,298
Retained profit 537,922
---------
Closing shareholders' funds 2,299,220
---------
</TABLE>
7
<PAGE>
GORANDEL TRADING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
PERIOD FROM 1 APRIL 1996 TO 31 DECEMBER 1996
1. INCORPORATION AND PRINCIPAL ACTIVITY
Gorandel Trading Limited was incorporated as a limited liability company on
21 July 1993 in Cyprus. The objects of the company are restricted to
business wholly outside Cyprus and its shares are held exclusively by
non-residents. Due to the above, the profits of the company are subject to
Cyprus income tax at reduced rates.
2. BASIS OF PRESENTATION
The financial statements have been prepared in accordance with
International Accounting Standards. The company changed the financial year
end date from 31 March, to 31 December; consequently, the financial
statements are for the period from 1 April 1996 to December 1996 and are
expressed in US Dollars.
3. ACCOUNTING POLICIES
The following policies have been applied consistently in dealing with items
which are considered material in relation to the company's financial
statements.
BASIS OF PREPARATION
The financial statements have been prepared under the historical cost
convention.
DEPRECIATION
Tangible fixed assets are depreciated on a straight-line basis over their
estimated useful lives as follows:
%
Equipment 20
Computers 20
Fixtures & fittings 20
Motor vehicles 25
The cost of leasehold of the flat will be depreciated over the life of the
lease.
DEFERRED COST
The cost of uniforms is capitalised and written off over 12 months, which
is considered to be their estimated useful economic life.
8
<PAGE>
GORANDEL TRADING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
PERIOD FROM 1 APRIL 1996 TO 31 DECEMBER 1996
3. ACCOUNTING POLICIES (CONTINUED)
FOREIGN EXCHANGE
Monetary assets and liabilities of the company are translated into US
dollars at the rates of exchange ruling at the balance sheet date and
non-monetary items are translated at historic rates.
Trading transactions in foreign currencies are converted into US dollars at
the rates of exchange ruling at the dates when they occur. Any gains or
losses arising on translation are taken to the Profit and Loss account.
4. INCOME
This represents all income received and receivable in respect of services
rendered to customers during the period.
5. AMOUNTS DUE FROM RELATED COMPANIES
Included in the amounts due from related companies are loans made to
related companies amounting to US$1,415,000.
6. FIXED ASSETS
<TABLE>
<CAPTION>
FIXTURES
AND MOTOR
FLAT EQUIPMENT COMPUTERS FITTINGS VEHICLES TOTAL
US$ US$ US$ US$ US$ US$
<S> <C> <C> <C> <C> <C> <C>
COST
1 April 1996 18,000 28,881 6,833 8,469 41,000 103,183
Additions -- 1,466 7,955 14 28,000 37,435
------ ------ ------ ----- ------ -------
31 December 1996 18,000 30,347 14,788 8,483 69,000 140,618
------ ------ ------ ----- ------ -------
DEPRECIATION
1 April 1996 660 5,588 1,615 1,973 8,500 18,336
Charge for the period 543 4,853 1,162 1,278 9,921 17,757
------ ------ ------ ----- ------ -------
31 December 1996 1,203 10,441 2,777 3,251 18,421 36,093
------ ------ ------ ----- ------ -------
NET BOOK VALUE
31 December 1996 16,797 19,906 12,011 5,232 50,579 104,525
------ ------ ------ ----- ------ -------
31 March 1996 17,340 23,293 5,218 6,496 32,500 84,847
------ ------ ------ ----- ------ -------
</TABLE>
9
<PAGE>
GORANDEL TRADING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
PERIOD FROM 1 APRIL 1996 TO 31 DECEMBER 1996
7. TAXATION
A provision for Cyprus corporation tax for the period from 1 April 1996 to
31 December 1996 was made, amounting to US$42,769.
A provision of US$477,790 has been made in respect of estimated foreign
tax liabilities.
8. SHARE CAPITAL
<TABLE>
<CAPTION>
31/12/1996
US$
<S> <C>
AUTHORISED
1,000 ordinary shares of Cyprus pounds 1 each 1,940
-----
ISSUED
1,000 ordinary shares of Cyprus pounds 1 each 1,940
-----
</TABLE>
9. SUMMARY OF SIGNIFICANT DIFFERENCES BETWEEN INTERNATIONAL ACCOUNTING
STANDARDS AND UNITED STATES OF AMERICA GENERALLY ACCEPTED ACCOUNTING
PRINCIPLES
The financial statements are prepared in conformity with International
Accounting Standards, which differ in certain significant respects from
those applicable in the United States of America (US GAAP). Application
of US GAAP to these financial statements would not result in any material
differences to profit attributable to shareholders and shareholders' funds.
10
<PAGE>
GORANDEL TRADING LIMITED
FINANCIAL STATEMENTS
31 MARCH 1996 AND 1995
Auditors' Report to the members of Gorandel Trading Limited
We have audited the accompanying balance sheets of Gorandel Trading Limited
at 31 March 1995 and 1996 and the related profit and loss accounts,
reconciliations of movements in shareholders' funds and cash flow statements
for the years then ended. These financial statements are the responsibility of
the management of Gorandel Trading Limited. Our responsibility is to express an
opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United Kingdom and in the United States of America. Those standards
require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Gorandel Trading Limited
at 31 March 1995 and 1996 and the results of its operations and cash flows
for the years then ended, in conformity with International Accounting
Standards.
Accounting principles in International Accounting Standards vary in certain
significant respects from accounting principles generally accepted in the
United States of America. Application of accounting principles generally
accepted in the United States would have affected profit attributable to
shareholders for each of the years in the two year period ended 31 March
1996 and shareholders' funds at 31 March 1995 and 1996, to the extent
summarised in note 8 to the financial statements.
KPMG 29 July 1996
Chartered Accountants
Registered Auditors
London
11
<PAGE>
GORANDEL TRADING LIMITED
PROFIT AND LOSS ACCOUNTS
FOR THE YEARS ENDED 31 MARCH 1996 AND 1995
<TABLE>
<CAPTION>
YEAR ENDED
31/3/1996 31/3/1995
NOTE US$ US$
<S> <C> <C> <C>
Turnover 4 5,781,357 3,419,300
--------- ---------
Profit from operations 1,180,263 843,588
--------- ---------
Including charges in respect of:
Depreciation 15,951 2,385
Auditors' remuneration 3,672 3,192
Interest expense 41,067 21,467
--------- ---------
60,690 27,044
========= =========
Taxation 6 180,130 189,806
--------- ---------
Profit for the year after
taxation 1,000,133 653,782
Profit brought forward 759,225 105,443
--------- ---------
Profit carried forward 1,759,358 759,225
========= =========
</TABLE>
There were no other recognised gains and losses other than those shown above.
12
<PAGE>
GORANDEL TRADING LIMITED
BALANCE SHEETS AS AT 31 MARCH 1996 AND 1995
<TABLE>
<CAPTION>
1996 1995
NOTE US$ US$
<S> <C> <C> <C>
CURRENT ASSETS
Debtors 1,944,869 888,236
Deferred cost 3 24,330 23,437
Shareholders' current account 8,372 8,372
Amounts due from related
companies 405,000 --
Cash at bank 518,711 717,668
--------- ---------
2,901,282 1,637,713
--------- ---------
CURRENT LIABILITIES
Creditors 860,249 406,124
Amounts due to related company 95,237 311,878
Taxation payable 6 269,345 194,937
--------- ---------
1,224,831 912,939
--------- ---------
NET CURRENT ASSETS 1,676,451 724,774
FIXED ASSETS 5 84,847 36,391
========= =========
NET ASSETS 1,761,298 761,165
========= =========
CAPITAL AND RESERVES
Share capital 7 1,940 1,940
Profit and loss account 1,759,358 759,225
========= =========
1,761,298 761,165
========= =========
</TABLE>
13
<PAGE>
GORANDEL TRADING LIMITED
CASH FLOW STATEMENTS
FOR THE YEARS ENDED 31 MARCH 1996 AND 1995
<TABLE>
<CAPTION>
YEAR ENDED
31/3/1996 31/3/1995
US$ US$
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net profit for the year before taxation............. 1,180,263 843,588
Adjusting for:
Depreciation....................................... 15,951 2,385
Interest receivable................................ (11,107) --
--------- -------
Operating profit before working capital changes .... 1,185,107 845,973
Increase in debtors................................ (1,056,633) (580,355)
(Increase)/decrease in deferred cost............... (893) 50,910
Increase in creditors.............................. 454,125 331,374
Increase in shareholders' account.................. -- (6,432)
--------- -------
CASH USED IN OPERATIONS............................. 581,706 641,470
Taxation paid....................................... (105,722) --
--------- -------
Net cash from operating activities.................. 475,984 641,470
--------- -------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets............................ (64,407) (38,776)
Interest received................................... 11,107 --
--------- -------
Net cash used in investing activities............... (53,300) (38,776)
--------- -------
CASH FLOWS FROM FINANCING ACTIVITIES
Amounts due to related companies.................... (621,641) (11,407)
--------- -------
Net cash used in financing activities............... (621,641) (11,407)
--------- -------
NET (DECREASE)/INCREASE IN CASH AND CASH
EQUIVALENTS........................................ (198,957) 591,287
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR ..... 717,668 126,381
--------- -------
CASH AND CASH EQUIVALENTS AT END OF YEAR............ 518,711 717,668
--------- -------
Cash and cash equivalents are defined by:
Cash at bank and in hand............................ 518,711 717,668
========= =======
</TABLE>
14
<PAGE>
GORANDEL TRADING LIMITED
RECONCILIATIONS OF MOVEMENTS IN SHAREHOLDERS' FUNDS
FOR THE YEARS ENDED 31 MARCH 1996 AND 1995
<TABLE>
<CAPTION>
Year ended Year ended
31 March 1996 31 March 1995
US$ US$
<S> <C> <C>
Opening shareholders' funds 761,165 107,383
Retained profit 1,000,133 653,782
--------- -------
Closing shareholders' funds 1,761,298 761,165
--------- -------
</TABLE>
15
<PAGE>
GORANDEL TRADING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31 MARCH 1996
1. INCORPORATION AND PRINCIPAL ACTIVITY
Gorandel Trading Limited was incorporated as a limited liability company on
21 July 1993 in Cyprus. The objects of the company are restricted to
business wholly outside Cyprus and its shares are held exclusively by
non-residents. Due to the above, the profits of the company are subject to
Cyprus income tax at reduced rates.
2. BASIS OF PRESENTATION
The financial statements which have been prepared in accordance with
International Accounting Standards, are for the years ended 31 March 1996
and 1995 and are expressed in US Dollars.
3. ACCOUNTING POLICIES
The following policies have been applied consistently in dealing with items
which are considered material in relation to the company's financial
statements.
BASIS OF PREPARATION
The financial statements have been prepared under the historical cost
convention.
DEPRECIATION
Tangible fixed assets are depreciated on a straight-line basis over their
estimated useful lives as follows:
<TABLE>
<CAPTION>
%
<S> <C>
Equipment 20
Computers 20
Fixtures & fittings 20
Motor vehicles 25
</TABLE>
The leasehold flat will be depreciated over the life of the lease.
DEFERRED COST
The cost of uniforms has been capitalised and written off over 12
months, their estimated useful economic life.
16
<PAGE>
GORANDEL TRADING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31 MARCH 1996
3. ACCOUNTING POLICIES (CONTINUED)
FOREIGN EXCHANGE
Monetary assets and liabilities of the company are translated into US
dollars at the rates of exchange ruling at the balance sheet date and
non-monetary items are translated at historic rates.
Trading transactions in foreign currencies are converted into US dollars at
the rates of exchange ruling at the dates when they occur. Any gains or
losses arising on translation are taken to the Profit and Loss Account.
4. INCOME
This represents all income received and receivable in respect of services
rendered to customers during the year.
5. FIXED ASSETS
<TABLE>
<CAPTION>
FIXTURES
AND MOTOR
FLAT EQUIPMENT COMPUTERS FITTINGS VEHICLES TOTAL
US$ US$ US$ US$ US$ US$
<S> <C> <C> <C> <C> <C> <C>
COST
1 April 1995 -- 21,450 2,554 7,772 7,000 38,776
Additions 18,000 7,431 4,279 697 34,000 64,407
------ ------ ----- ----- ------ -------
31 March 1996 18,000 28,881 6,833 8,469 41,000 103,183
------ ------ ----- ----- ------ -------
DEPRECIATION
1 April 1995 -- 916 350 389 730 2,385
Charge for the
year 660 4,672 1,265 1,584 7,770 15,951
------ ------ ----- ----- ------ -------
31 March 1996 660 5,588 1,615 1,973 8,500 18,336
------ ------ ----- ----- ------ -------
NET BOOK VALUE
31 March 1996 17,340 23,293 5,218 6,496 32,500 84,847
====== ====== ===== ===== ====== ======
31 March 1995 -- 20,534 2,204 7,383 6,270 36,391
====== ====== ===== ===== ====== ======
</TABLE>
17
<PAGE>
GORANDEL TRADING LIMITED
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 31 MARCH 1996
6. TAXATION
The Cyprus corporation tax payable for the year ended 31 March 1996 is
estimated at US$ 41,750.
A provision of US$ 138,380 has been made in respect of estimated foreign
tax liabilities.
7. SHARE CAPITAL
<TABLE>
<CAPTION>
1996
US$
<S> <C>
Authorised
1,000 ordinary shares of Cyprus pounds (pounds
sterling)1 each 1,940
=====
Issued
1,000 ordinary shares of Cyprus pounds (pounds
sterling)1 each 1,940
=====
</TABLE>
8. SUMMARY OF SIGNIFICANT DIFFERENCES BETWEEN INTERNATIONAL ACCOUNTING
STANDARDS AND UNITED STATES OF AMERICA GENERALLY ACCEPTED ACCOUNTING
PRINCIPLES
The financial statements are prepared in conformity with International
Accounting Standards, which differ in certain significant respects from
those applicable in the United States of America (US GAAP). Application
of US GAAP to these financial statements would not result in any material
differences to profit attributable to shareholders and shareholders' funds.
18
<PAGE>
GORANDEL TRADING LIMITED
UNAUDITED CONSOLIDATED PROFIT AND LOSS ACCOUNT - 31 MARCH 1997 AND 1996
Three months ended
Mar-97 Mar-96
$000 $000
----------------------
Turnover 1,900 1,482
Cost of sales 1,324 1,010
----------------------
Gross profit 576 472
Administrative expenses 226 273
----------------------
Profit on ordinary activities before taxation 350 199
Tax on profit on ordinary activities 186 45
----------------------
Profit on ordinary activities after taxation 164 154
======================
19
<PAGE>
GORANDEL TRADING LIMITED
UNAUDITED CONSOLIDATED BALANCE SHEET - 31 MARCH 1997
Mar-97
$000
--------
Fixed assets
Tangible assets 99
Current assets
Debtors 3,800
Cash at bank and in hand 198
--------
3,998
Creditors: amounts falling due within one year 1,552
--------
Net current assets 2,446
--------
Total assets less current liabilities 2,545
Creditors: amounts falling due after more than one year 0
--------
Net assets 2,545
--------
Capital and reserves
Share capital 2
Profit and loss account 2,543
--------
Shareholders' funds 2,545
--------
20
<PAGE>
GORANDEL TRADING LIMITED
UNAUDITED CONSOLIDATED CASH FLOW STATEMENT - 31 MARCH 1997 AND 1996
Mar-97 Mar-96
$000 $000
---------------------
Cash flows from operating activities
Net profit for the year before taxation $350 $199
Adjusting for:
Depreciation 10 4
---------------------
Operating profit before working capital changes 360 203
Increase in debtors (493) (10)
Increase (decrease) in creditors (130) 12
Decrease in shareholders' account 130 -
---------------------
Cash (used in) provided by operations (133) 205
Income tax paid (36) -
---------------------
Net cash from operating activities (169) 205
Cash flows from investing activities
Purchase of fixed assets (2) (19)
---------------------
Net cash used in investing activities (2) (19)
Cash flows from financing activities
Amounts due to related companies 102 (408)
---------------------
Net cash used in financing activities 102 (408)
Net decrease in cash and cash equivalents (69) (222)
Cash and cash equivalents at beginning of period 267 741
---------------------
Cash and cash equivalents at end of period 198 519
=====================
Cash and cash equivalents are defined by:
Cash at bank and in hand 198 519
=====================
21
<PAGE>
GORANDEL TRADING LIMITED
NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS
SUMMARY OF SIGNIFICANT DIFFERENCES BETWEEN UNITED KINGDOM AND UNITED STATES OF
AMERICA GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. The group's consolidated
financial statements are prepared in conformity with generally accepted
accounting principles applicable in the United Kingdom (UK GAAP), which differ
in certain significant respects from those applicable in the United States of
America (US GAAP). There were no other material differences between UK GAAP and
US GAAP identified for the three months ended March 31, 1997 and 1996.
22
<PAGE>
Pro Forma Financial Information.
The following unaudited pro forma income statements for the three
month period ended March 31, 1997 and for the year ended December 28, 1996
gives effect to the GTL Acquisition on June 9, 1997 as if the GTL Acquisition
had occurred as of January 1, 1997 and January 1, 1996, respectively. The
following unaudited pro forma balance sheet as of March 29, 1997 gives effect
to the GTL Acquisition as if such transaction had occurred on March 29, 1997.
These unaudited pro forma financial statements may not be indicative
of the results that actually would have occurred if the transaction referred to
above had been in effect on the dates indicated or the results that may be
obtained in the future.
UNAUDITED PRO FORMA INCOME STATEMENT
FOR THE THREE-MONTHS ENDED MARCH 29, 1997
(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
--------------------------------------- ------------------------------
AHI (A) GTL(A) COMBINED ADJUSTMENTS COMBINED
--------------------------------------- ------------------------------
<S> <C> <C> <C> <C> <C>
NET SALES $14,750 $1,900 $16,650 $16,650
COST AND EXPENSES:
Cost of sales 10,453 1,324 11,777 11,777
Operating expenses 2,977 226 3,203 3,203
Depreciation and amortization 286 286 12 (b) 298
Interest expense, net 69 69 69
Equity in earnings of investee (income) (272) (272) 82 (c) (190)
---------------------------------------------------------------------
OPERATING INCOME 1,237 350 1,587 (94) 1,493
INCOME TAXES 554 186 740 (50)(d) 690
PREFERENCE SHARE DIVIDENDS 143 143 143
---------------------------------------------------------------------
NET INCOME APPLICABLE TO
COMMON STOCKHOLDERS $ 540 $164 $ 704 $(44) $ 660
=====================================================================
EARNINGS PER COMMON SHARE $ 0.04 $ 0.05
========== =============
WEIGHTED AVERAGE COMMON
SHARES 12,797 (e) 12,912
========== =============
</TABLE>
See accompanying Notes to Unaudited Pro Forma Financial Statements.
23
<PAGE>
UNAUDITED PRO FORMA INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 28, 1996
(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
---------------------------------------------------------------------------
AHI (a) GTL(a) COMBINED ADJUSTMENTS COMBINED
--------------------------------------- --------------------------------
<S> <C> <C> <C> <C> <C>
NET SALES $30,967 $6,354 $37,321 $37,321
COST AND EXPENSES:
Cost of sales 21,172 4,381 25,553 25,553
Operating expenses 6,905 615 7,520 7,520
Depreciation and amortization 554 - 554 49 (b) 603
Interest expense, net 515 105 620 620
Equity in earnings of investee (320) - (320) 95 (c) (225)
------------------------------------- --------------------------------
OPERATING INCOME 2,141 1,253 3,394 (144) 3,250
NON-OPERATING INCOME 2 2 2
------------------------------------- --------------------------------
INCOME BEFORE INCOME
TAXES AND PREFERENCE
SHARE DIVIDENDS 2,143 1,253 3,396 (144) 3,252
INCOME TAXES 1,215 608 1,823 (70)(d) 1,753
PREFERENCE SHARE
DIVIDENDS 239 239 239
------------------------------------- --------------------------------
NET INCOME APPLICABLE TO
COMMON STOCKHOLDERS $ 689 $ 645 $ 1,334 $ (74) $ 1,260
===================================== ================================
EARNINGS PER COMMON
SHARE $ 0.08 $ 0.14
=========== ============
WEIGHTED AVERAGE
COMMON SHARES 8,876 (e) 8,991
=========== ============
</TABLE>
See accompanying Notes to Unaudited Pro Forma Financial Statements.
24
<PAGE>
UNAUDITED PRO FORMA BALANCE SHEET
MARCH 29, 1997
(AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA
----------------------------------------------------------------------------
AHI (a) GTL(a) COMBINED ADJUSTMENTS COMBINED
----------------------------------- ----------------------------------
<S> <C> <C> <C> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 4,135 $ 198 $ 4,333 $(1,170) (f) $ 3,163
Accounts receivable, net 12,408 2,287 14,695 14,695
Inventories 4,897 - 4,897 4,897
Prepaid expenses and other current
assets 2,432 1,513 3,945 3,945
--------------------------------------- --------------------------------
Total current assets 23,872 3,998 27,870 (1,170) 26,700
PROPERTY, PLANT AND
EQUIPMENT, net 6,676 99 6,775 6,775
INTANGIBLE ASSETS 16,844 16,844 1,448 (f) 18,292
INVESTMENT IN ASSOCIATED
COMPANIES 1,451 1,451 (1,273)(g) 178
OTHER ASSETS 449 449 449
--------------------------------------- --------------------------------
TOTAL ASSETS $ 49,292 $ 4,097 $ 53,389 $ (995) $ 52,394
======================================= ================================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term borrowings $ 357 $ - $ 357 $ 357
Current portion of long-term debt 1,369 - 1,369 1,369
Accounts payable, accrued expenses
and other 7,673 1,552 9,225 350 (f) 9,575
--------------------------------------- --------------------------------
Total current liabilities 9,399 1,552 10,951 350 11,301
MINORITY INTEREST 32 - 32 32
LONG-TERM DEBT and capitalized lease
obligations 6,945 - 6,945 6,945
--------------------------------------- --------------------------------
Total liabilities 16,376 1,552 17,928 350 18,278
PREFERENCE SHARES 7,216 - 7,216 7,216
STOCKHOLDERS' EQUITY:
Common stock 119 2 121 (1)(f) 120
Additional paid-in capital 23,480 - 23,481 1,199 (f) 24,680
Foreign currency exchange translation (105) - (105) (105)
Retained earnings 2,205 2,543 4,748 (2,543)(f)(g) 2,205
--------------------------------------- --------------------------------
Total stockholders' equity 25,700 2,545 28,245 (1,345) 26,900
--------------------------------------- --------------------------------
TOTAL LIABILITIES &
STOCKHOLDERS' EQUITY $ 49,292 $ 4,097 $ 53,389 $ (995) $ 52,394
======================================= ================================
</TABLE>
See accompanying Notes to Unaudited Pro Forma Financial Statements.
25
<PAGE>
NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS
(a) Historical results of operations include the following:
AHI - results of operations of Armor Holdings, Inc. for the three months
ended March 29, 1997 and for the fiscal year ended December 28, 1996
DJL - results of operation of DJL Group Limited for the 3 months ended
March 29, 1997 and for the period June 3, 1996 (date of incorporation)
until December 28, 1996
GTL - results of operations of Gorandel Trading Limited for the three
months ended March 31, 1997 and Gorandel Trading Limited for the fiscal
year ended December 28, 1996
(b) Reflects the adjustment to record the amortization of intangible assets
resulting from the GTL acquisition.
(c) Reflects the elimination of the historical 50% equity in earnings of GTL,
which is included in the the AHI amounts, as such amounts are included
gross in the GTL amounts.
(d) Adjustment to reflect the income tax effect of the pro forma adjustments.
(e) Includes 115,176 shares for the acquisition of GTL as if such shares were
issued at the beginning of the period.
(f) Reflects the allocation of the excess cost over net assets acquired of GTL
as follows:
Purchase price of GTL:
Cash $1,170
Value of Company shares 1,200
Transaction costs 350
------
2,720
Less: pro forma value of net tangible assets acquired 1,272
------
Unallocated excess of purchase price over net
tangible assets acquired $1,448
======
(g) Reflects the elimination of the historical 50% investment in GTL, which is
included in the supplemental Company amounts, as such amounts are included
gross in the GTL amounts.
26
<PAGE>
(c) Exhibits.
EXHIBIT DESCRIPTION
- ------- -----------
2.1* Share Acquisition Agreement, dated as of June 9, 1997, between
the Company, Strontian, Alpha-A Limited, and others.
10.1* Agreement, dated June 9, 1997, between the Company and members of
senior management of GTL.
10.2* Taxation Indemnity, dated June 9, 1997, by Strontian in favor of
the Company.
10.3* Services Agreement, dated June 9, 1997, between GTL, Alpha-A and
others.
10.4* Service Agreement, dated June 9, 1997, between GTL and Mikhail
Golovatov.
10.5* Deed of Covenant, dated June 9, 1997, between the Company,
Defence Systems, DSL Overseas, GTL and Igor Orekhov.
10.6* Deed of Covenant, dated June 9, 1997, between the Company,
Defence Systems, DSL Overseas, GTL and Mikhail Golovatov.
10.7* Loan Agreement, dated June 9, 1997, between Strontian and Defence
Systems.
10.8* Stock Pledge Agreement, dated June 9, 1997, between Defence
Systems, Strontian, Mikhail Golovatov and Igor Orekhov.
10.9* Termination Agreement of a Joint Venture Agreement relating to
GTL, dated June 9, 1997, between DSL Overseas, Strontian, GTL,
Defence Systems and Alpha-A.
23.1** Consent of KPMG.
- --------------
* Previously filed as part of this Current Report on Form 8-K on
June 24, 1997.
** Filed herewith.
27
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ARMOR HOLDINGS, INC.
/s/ Carol T. Burke
------------------------------------
Carol T. Burke
Vice President-Finance and Secretary
Dated: August 11, 1997
28
<PAGE>
EXHIBIT INDEX
The following exhibit is filed herewith:
EXHIBIT DESCRIPTION
- ------- -----------
23.1 Consent of KPMG.
<PAGE>
The Board of Directors
Gorandel Trading Limited:
We consent to the incorporation by reference in the registration statement
(No. 333-8533) on Form S-3 of Armor Holdings Inc. of our report dated 15 April
1997, with respect to the balance sheet of Gorandel Trading Limited as of
31 December 1996 and the related profit and loss account and cash flow
statement for the period from 1 April 1996 to 31 December 1996, and of our
report dated 29 July 1996, with respect to the balance sheets of Gorandel
Trading Limited as of 31 March 1996 and 1995 and the related profit and loss
accounts and cash flow statements for each of the years then ended, which
reports appear in the Form 8-K/A-1 of Armor Holdings, Inc. dated
11 August 1997.
/s/ KPMG
KPMG
London, England
11 August 1997
