<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended Commission
September 30, 1995 File Number 0-8241
- --------------------- --------------------
Barringer Laboratories, Inc.
- ------------------------------------------------------------------------------
(Name of small business issuer in its charter)
Delaware 84-0951626
- ------------------------------- ------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
15000 West 6th Avenue, Suite 300, Golden, Colorado 80401-5047
- ------------------------------------------------------------------------------
(Address of principal executive office)
Issuer's telephone number, including area code (303) 277-1687
-------------------------------
Note: Please address financial or S.E.C. compliance queries to: Chief
Financial Officer, 15000 West 6th Avenue, Suite 300, Golden, Colorado
80401-5047.
Indicate by check mark whether the issuer (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 issuer
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
--- ---
Number of shares outstanding as of September 30, 1995 - 2,299,254 of
---------
Common Stock, $.01 par value.
1
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
INDEX
<TABLE>
<S> <C> <C>
Part I - Financial Information
- Consolidated Balance Sheets as of September 30, 1995
(Unaudited) and December 31, 1994;
- Consolidated Statements of Operations (Unaudited) for
the Three Months and Nine Months Ended September 30,
1995 and 1994;
- Consolidated Statements of Cash Flows (Unaudited) for
the Three Months and Nine Months Ended September 30,
1995 and 1994;
- Notes to Consolidated Financial Statements; and
- Management's Discussion and Analysis of Financial
Condition and Results of Operations
Part II - Other Information
- None
Signatures
</TABLE>
2
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
------------- ------------
(Unaudited)
<S> <C> <C>
Assets
Current Assets:
Cash and cash equivalents $ 333,000 $ 39,000
Trade receivables, less
allowance of $17,000 for
doubtful accounts 896,000 777,000
Due from affiliate 40,000 34,000
Prepaid expenses and other 21,000 69,000
---------- ----------
Total Current Assets 1,290,000 919,000
---------- ----------
Property and Equipment:
Machinery and equipment 1,640,000 1,455,000
Machinery and equipment under
capital lease obligations 640,000 895,000
Leasehold improvements 638,000 638,000
Office furniture and equipment 62,000 62,000
---------- ----------
2,980,000 3,050,000
Less accumulated depreciation and
amortization 2,336,000 2,273,000
---------- ----------
Net Property and Equipment 644,000 777,000
Note Receivable from Affiliate 452,000 452,000
Other Assets 65,000 93,000
---------- ----------
Total Assets $2,451,000 $2,241,000
========== ==========
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Concluded)
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
------------- ------------
(Unaudited)
<S> <C> <C>
Liabilities and Shareholders' Equity
Current Liabilities:
Line of credit $ - $ 4,000
Trade accounts payable 146,000 215,000
Accrued liabilities:
Payroll, compensation and
related expenses 203,000 184,000
Other 138,000 166,000
Current maturities of long-term debt 176,000 230,000
----------- -----------
Total Current Liabilities 663,000 799,000
Long-Term Debt, less current maturities 65,000 151,000
----------- -----------
Total Liabilities 728,000 950,000
----------- -----------
Shareholders' Equity
Preferred stock, $2.00 par value,
1,000,000 shares authorized;
none issued - -
Common stock, $0.01 par value,
shares authorized, 10,000,000,
outstanding 2,299,254 23,000 23,000
Additional paid-in capital 3,278,000 3,278,000
Deficit (1,569,000) (1,982,000)
Translation adjustment (9,000) (28,000)
----------- -----------
Total Shareholders' Equity 1,723,000 1,291,000
----------- -----------
Total Liabilities and Shareholders'
Equity $ 2,451,000 $ 2,241,000
=========== ===========
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
IN THOUSANDS EXCEPT SHARE DATA
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Nine Months
Ended 9/30 Ended 9/30
---------------- ----------------
1995 1994 1995 1994
------ ------ ------ ------
<S> <C> <C> <C> <C>
Sales of Services
United States $1,763 $1,545 $4,632 $4,375
Mexico 104 15 324 15
------ ------ ------ ------
Total Sales of Services 1,867 1,560 4,956 4,390
Cost of Services Sold 1,216 1,159 3,438 3,430
------ ------ ------ ------
Gross Profit 651 401 1,518 960
------ ------ ------ ------
Selling, general and
administrative 336 335 1,025 998
------ ------ ------ ------
Operating Profit (Loss) 315 66 493 (38)
Other Income (Expense):
Recovery of Contingency
Reserve - - - 76
Interest income 19 14 53 43
Interest expense (22) (23) (67) (73)
Strategic alliance (18) - (30) -
Non-recurring charge - - (20) -
Translation loss (3) - (19) -
Other 4 (14) 3 (5)
------ ------ ------ ------
Total Other Income
(Expense) (20) (23) (80) 41
------ ------ ------ ------
Income before Income
Taxes 295 43 413 3
Provision for Income Taxes - - - -
------ ------ ------ ------
Net Income for the
period $ 295 $ 43 $ 413 $ 3
====== ====== ====== ======
</TABLE>
See accompanying notes to consolidated financial statements.
5
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
IN THOUSANDS EXCEPT SHARE DATA
(UNAUDITED)
(Continued)
<TABLE>
<CAPTION>
Three Months Nine Months
Ended 9/30 Ended 9/30
---------------------- ----------------------
1995 1994 1995 1994
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Per Share Data:
Net Income
per share $ .13 $ .02 $ .18 $ -
====== ====== ====== =======
Weighted average common
shares outstanding 2,299,254 2,198,919 2,299,254 2,225,990
========= ========= ========= =========
</TABLE>
See accompanying notes to consolidated financial statements.
6
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
IN THOUSANDS EXCEPT SHARE DATA
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Nine Months
Ended 9/30 Ended 9/30
------------ -------------
1995 1994 1995 1994
------------ -------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income for the period $ 295 $ 43 $ 413 $ 3
Items not affecting cash
Depreciation and amortization 145 146 420 418
Deferred compensation expense - 13 - 13
Bad debt expense 4 3 8 9
Other 3 (20) 19 (5)
Decrease (increase) in
operating assets net of
operating liabilities 111 (227) (148) (227)
----- ------ ------ -----
Cash provided by (used in)
Operating Activities 558 (42) 712 211
----- ------ ------ -----
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and
equipment (86) (49) (164) (199)
Payments received on note
receivable from affiliate - - - 136
----- ------ ------ -----
Cash used in Investing
Activities (86) (49) (164) (63)
----- ------ ------ -----
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in long-term debt - - - 21
Reduction in long-term debt (79) (78) (250) (245)
Increase (decrease) in short
term borrowings (107) 101 (4) 111
----- ------ ------ -----
Cash provided by (used in)
Financing Activities (186) 23 (254) (113)
----- ------ ------ -----
Increase (decrease) in cash
and cash equivalents 286 (68) 294 35
Cash and cash equivalents-
beginning of period 47 138 39 35
----- ------ ------ -----
Cash and cash equivalents-
end of period $ 333 $ 70 $ 333 $ 70
===== ====== ====== =====
</TABLE>
See accompanying notes to consolidated financial statements.
7
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
IN THOUSANDS EXCEPT SHARE DATA
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(UNAUDITED)
(Continued)
<TABLE>
<CAPTION>
Three Months Nine Months
Ended 9/30 Ended 9/30
------------ -------------
1995 1994 1995 1994
------------ -------------
<S> <C> <C>
Decrease (increase) in
operating assets net of
operating liabilities
Trade receivables $ 91 $(178) $(127) $(118)
Other current assets 42 (62) 48 (33)
Due from affiliate 23 - (6) -
Accounts payable and
accrued liabilities (58) 6 (78) (82)
Other 13 7 15 6
----- ------ ------ -----
Total - net $ 111 $(227) $(148) $(227)
===== ====== ====== =====
Cash paid during the
period for interest $ 22 $ 23 $ 67 $ 73
===== ====== ====== =====
Cash paid during the
period for income taxes $ - $ - $ - $ -
===== ====== ====== =====
</TABLE>
See accompanying notes to consolidated financial statements.
8
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
In the opinion of the Company, the unaudited financial
statements contain all adjustments (consisting of only
normal recurring accruals) necessary to present fairly the
financial position of the Company and its wholly owned
subsidiary, Barringer Laboratorios de Mexico S.A. de C.V.
(BLM) as of September 30, 1995 and the results of their
operations and their cash flows for the three months and the
nine months ended September 30, 1995 and 1994. The
accounting policies followed by the Company are set forth in
the Notes to Consolidated Financial Statements in the 1994
audited financial statements of Barringer Laboratories, Inc.
and Subsidiary included in their Annual Report on Form 10-
KSB filed with the Securities and Exchange Commission. The
Form 10-KSB should be read in conjunction herewith.
2. NOTE RECEIVABLE FROM AFFILIATE
On April 7, 1995 the Company agreed to an additional
extension of Barringer Technologies Inc.'s ("BTI") note due
date to December 31, 1995 or the date upon which BTI sells
or other-ise disposes of any or all of its investment in the
common stock of the Company (1,074,000 common shares held as
security under this note agreement). In exchange for the
Company's agreement to extend the due date of this note, the
Company will receive warrants to purchase 25,000 shares of
common stock of BTI for a period of two years at an exercise
price of $1.00 per share.
BTI is currently seeking to sell its investment in the
Company. If the investment is sold the proceeds would be
used to pay down the note receivable. Absent a sale of its
investment in the common stock of the Company, the ability
of BTI to pay its obligation to the Company within the next
year is doubtful. As a result, this note has been classified
as non-current in the accompanying consolidated balance sheet.
9
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
3. SEASONALITY
The business of the Company has been seasonal as a result of
cold weather restricting the availability of samples to the
laboratories in the cold winter months. Therefore, the
results of operations for the interim periods are not
necessarily indicative of the results to be expected for the
full year.
10
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
MANAGEMENT DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
THREE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
Sales of Services for the three months ended September 30, 1995
of $1,867,000 represents an increase of $307,000 (19.7%) from the
same period in 1994. The Environmental Division experienced an
increase of $523,000 (69.6%) due to volume increases of $157,000
from existing customers requesting radiochemical analyses and an
existing customer's special project, which generated sales of
$138,000 for the three months ended September 30, 1995.
Additional increases were due to volume increases of $149,000
from other existing customers, and new customer's sales of
$79,000 in the three months ended September 30, 1995.
Environmental Division October, 1995 sales were substantially
ahead of October, 1994 sales and Management believes sales for
the rest of the year will equal 1994 sales levels. The Mineral
Division, which includes Mexico, experienced a decrease of
$216,000 (19.7%) due to customer's cancellation of drilling
projects as a result of the severe wet weather in the Sierra
Mountains of California and Nevada in April and May, 1995.
Additionally, there were 1995 volume decreases related to non-
recurring 1994 sales of $90,000 from two special one time
projects. These decreases were offset by sales increase in
Mexico of $89,000 due to the addition of new customers in Mexico.
Mineral Division sales should continue to increase for the rest
of the year, but will still be below 1994 sales levels.
Gross profit as a percentage of sales for the three months ended
September 30, 1995 was 34.9% as compared to 25.7% for the same
period in 1994. This increase was primarily due to higher
Environmental Division sales, production efficiencies in the
Environmental Division resulting from higher sales, and fixed
costs allocated over a larger sales base.
Selling, general, and administration expenses for the three
months ended September 30, 1995 of $336,000 were at approximately
the same level as those from the 1994 period.
11
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
MANAGEMENT DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS (CONTINUED)
THREE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994 (CONTINUED)
Other expenses for the three months ended September 30, 1995 were
$20,000 compared to $23,000 for the same period in 1994. This
decrease in other expenses of $3,000 was due to higher interest
income and higher other income, which increased $18,000 from
1994, offset by strategic alliance expense of $18,000 and
translation loss of $3,000. Other income of $3,000 was higher
than 1994 other expenses of $14,000 which reflected compensation
expense of $13,000 related to short term borrowings from a
related party. Strategic alliance expense is related to
professional fees paid to an independent investment banking firm
to evaluate the Company and to identify potential funding sources
to obtain additional debt or equity financing.
For the three months ended September 30, 1995 the Company had
income before income taxes of $295,000 compared to income before
income taxes of $43,000 for the same period in 1994. This
increase of $252,000 was primarily due to higher Environmental
sales, production efficiencies in the Environmental Division,
fixed costs allocated over a larger sales base, and higher
interest income, offset by strategic alliance expense of $18,000
and translation loss of $3,000.
NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
Sales of Services for the nine months ended September 30, 1995 of
$4,956,000 represents an increase of $566,000 (12.9%) from the
same period in 1994. The Environmental Division experienced an
increase of $1,126,000 (50.4%) due to volume increases of
$408,000 from existing customers requesting radiochemical
analyses, an existing customer's large project, which generated
sales of $254,000, additional volume increases of $31,000 from
other existing customers and new customer's sales of $193,000.
Additionally, there was another customer special project which
generated sales of $240,000 in the nine months ended September
30, 1995. Environmental Division October, 1995 sales were ahead
of October, 1994 sales and Management believes sales for the rest
of the year will equal 1994 sale levels. The Mineral Division,
which includes Mexico, experienced a decrease of $560,000 (25.9%)
due to customer volume decreases in the first five months of 1995
related to the cancellation of drilling projects caused by severe
wet weather in the Sierra Mountains of California and Nevada.
12
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
MANAGEMENT DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS (CONTINUED)
NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994 (CONTINUED)
Additionally, there were 1995 volume decreases related to non-
recurring 1994 sales of $283,000 from two special one time
projects. These decreases were offset by sales in Mexico of
$324,000 for the nine months ended September 30, 1995 compared to
sales of $15,000 in Mexico for the same period in 1994.
Gross profit as a percentage of sales for the nine months ended
September 30, 1995 was 30.6% as compared to 21.9% for the same
period in 1994. This increase was primarily due to higher
Environmental Division sales, production efficiencies in the
Environmental Division resulting from higher sales, and fixed
costs allocated over a larger sales base.
Selling, general and administrative expenses for the nine months
ended September 30, 1995 of $1,025,000 increased by $27,000
(2.7%) from the same period in 1994 primarily due to higher
general and administrative expenses (travel, directors fees,
professional fees).
Other expenses for the nine months ended September 30, 1995 were
$80,000 compared to other income of $41,000 for the same period
in 1994. This increase in other expenses of $121,000 was due to
income of $76,000 from the net recovery of a contingency reserve
in the nine months ended September 30, 1994, 1995 expenses
consisting of a non-recurring charge of $20,000, strategic
alliance expense of $30,000, and translation loss of $19,000 from
the Company's Mexican subsidiary, offset by higher interest
income and other income. The non-recurring charge is the
Company's estimated cost to dispose of six 50-gallon barrels of
hazardous waste, which the Company had previously paid for
disposal. However, the vendor went out of business. As such
under current environmental laws and regulations, the Company is
still responsible for the proper disposal of this waste.
Strategic alliance expense is related to professional fees paid
to an independent investment banking firm to evaluate the Company
and to identify potential funding sources to obtain additional
debt or equity financing. The recovery of the contingency
reserve in the three months ended September, 1994 was related to
the warranties, representations, and guarantees made by the
Company in the 1992 sale of its Canadian subsidiary. These
warranties, representations, and guarantees expired on May 31,
1994.
13
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
MANAGEMENT DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS (CONTINUED)
NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994 (CONTINUED)
For the nine months ended September 30, 1995, the Company had
income before income taxes of $413,000 compared to income before
income taxes of $3,000 for the same period in 1994. This
increase in income of $410,000 was primarily due to higher
Environmental sales, production efficiencies in the Environmental
Division, and fixed costs allocated over a larger sales base.
These increases were offset by higher general and administrative
expenses, the non-recurring charge of $20,000, strategic alliance
expense of $30,000, translation losses of $19,000, and the
recovery of the contingency reserve of $76,000, which incurred in
1994.
14
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
MANAGEMENT DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
CAPITAL RESOURCES AND LIQUIDITY
Cash and cash equivalents totaled $333,000 at September 30, 1995,
compared with $39,000 at December 31, 1994. The $294,000
increase in cash and cash equivalents resulted from cash provided
by operating activities of $712,000 which was offset by cash used
in investing activities of $164,000 and net cash used in
financing activities of $254,000 primarily for the reduction of
long-term debt.
Cash used for investing activities was for the purchase of
property and equipment consisting of $70,000 of lab equipment,
$60,000 of vehicles, and $34,000 of computer hardware and
software to upgrade the Laboratory Information Management System
(LIMS).
The Company has a working line of credit from a lending
institution. This line of credit is equal to 80% of the
Company's eligible accounts receivable. This line of credit is
used to fund the Company's current working capital requirements
and has also been used to guarantee a $150,000 letter of credit
required by the Colorado Department of Health to increase the
level of the Company's Radiochemistry License. This increase in
the license gives the Company the ability to grow the
radiochemistry analytical business. Management believes that the
existing line of credit agreement is adequate to meet the
Company's working capital requirements for the next 12 months.
INFLATION
Inflation was not a material factor in either the sales or the
operating expenses of the Company during the periods presented
herein.
15
<PAGE>
BARRINGER LABORATORIES, INC. AND SUBSIDIARY
PART II
OTHER INFORMATION
None
16
<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.
BARRINGER LABORATORIES, INC.
----------------------------
(REGISTRANT)
Date: November 9, 1995 By: /s/ Charles E. Ramsay
------------------- -----------------------------
Charles E. Ramsay
Chief Financial Officer
17
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 333
<SECURITIES> 0
<RECEIVABLES> 896
<ALLOWANCES> 17
<INVENTORY> 0
<CURRENT-ASSETS> 1,290
<PP&E> 2,980
<DEPRECIATION> 2,336
<TOTAL-ASSETS> 2,451
<CURRENT-LIABILITIES> 663
<BONDS> 0
<COMMON> 23
0
0
<OTHER-SE> 1,700
<TOTAL-LIABILITY-AND-EQUITY> 2,451
<SALES> 4,956
<TOTAL-REVENUES> 0
<CGS> 3,438
<TOTAL-COSTS> 4,463
<OTHER-EXPENSES> 13
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 67
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 413
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 413
<EPS-PRIMARY> .18
<EPS-DILUTED> 0
</TABLE>
