- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 29, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission File No. 0-27122
ADEPT TECHNOLOGY, INC.
(Exact name of Registrant as specified in its charter)
California 94-29000635
- ---------------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
150 Rose Orchard Way
San Jose, California 95134
- ---------------------------------------- ------------------------------------
(Address of Principal executive offices) (Zip Code)
(408) 432-0888
----------------------------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (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 registrant was
required to file such reports) and, (2) has been subject to such filing
requirements for the past 90 days.
YES X NO
------- --------
The number of shares of the Registrant's common stock outstanding as of March
29, 1997 was 8,100,012.
- --------------------------------------------------------------------------------
<PAGE>
ADEPT TECHNOLOGY, INC.
INDEX
Page
----
PART I - FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements
Condensed Consolidated Balance Sheets
March 29, 1997 and June 30, 1996........................ 3
Condensed Consolidated Statements of Income
Three months and nine months ended
March 29, 1997 and March 30, 1996....................... 4
Condensed Consolidated Statements of Cash Flows
Nine months ended March 29, 1997 and March 30, 1996..... 5
Notes to Condensed Consolidated Financial Statements...... 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations......................... 8
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K............................. 11
Signatures................................................... 12
Index to Exhibits............................................ 13
2
<PAGE>
<TABLE>
ADEPT TECHNOLOGY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
<CAPTION>
March 29, June 30,
1997 1996 (1)
------------ ------------
(unaudited) (audited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents .......................................... $ 10,403 $ 8,075
Short term investments ............................................. 4,780 2,900
Accounts receivable, less allowance for doubtful accounts of
$463 at March 29, 1997 and $465 at June 30, 1996 ............... 18,783 20,495
Inventories ........................................................ 14,032 14,808
Deferred tax assets and prepaid expenses ........................... 2,690 2,255
-------- --------
Total current assets ........................................ 50,688 48,533
Property and equipment at cost:
Computer equipment ................................................. 5,595 3,312
Office furniture and equipment ..................................... 2,186 1,767
Machinery and equipment ............................................ 10,705 11,450
-------- --------
18,486 16,529
Less accumulated depreciation and amortization ..................... 12,495 10,798
-------- --------
Net property and equipment ............................................. 5,991 5,731
Long term investments .................................................. 1,000 -
Intangible assets related to acquisition of Silma Incorporated, net of
accumulated amortization of $536 and $306 at March 29, 1997
and June 30, 1996, respectively ................................ 881 1,167
Other assets ........................................................... 797 921
-------- --------
Total assets ................................................ $ 59,357 $ 56,352
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable ................................................... $ 5,830 $ 6,894
Other accrued liabilities .......................................... 8,409 6,521
Current portion of obligations under capital leases ................ 43 88
-------- --------
Total current liabilities ................................... 14,282 13,503
Obligations under capital leases ....................................... 1 26
Commitments and contingencies
Shareholders' equity:
Preferred stock, no par value:
5,000 shares authorized, none issued and outstanding ........... - -
Common stock, no par value:
25,000 shares authorized; 8,100 and 7,869 issued and outstanding
at March 29, 1997 and June 30, 1996, respectively ........... 46,269 45,383
Accumulated deficit ................................................ (1,195) (2,560)
-------- --------
Total shareholders' equity .................................. 45,074 42,823
-------- --------
Total liabilities and shareholders' equity .................. $ 59,357 $ 56,352
======== ========
<FN>
(1) Amounts derived from the Company's audited financial statements for the
year ended June 30, 1996.
See accompanying notes to condensed consolidated financial statements.
</FN>
</TABLE>
3
<PAGE>
<TABLE>
ADEPT TECHNOLOGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
(In thousands, except per share data)
<CAPTION>
Three Months Ended Nine Months Ended
------------------ -----------------
March 29, March 30, March 29, March 30,
1997 1996 1997 1996
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net revenues $21,104 $20,800 $58,428 $61,214
Cost of revenues 12,299 11,852 34,597 35,133
------- ------- ------- -------
Gross margin 8,805 8,948 23,831 26,081
Operating expenses:
Research, development and engineering 2,305 2,112 6,335 6,131
Selling, general and administrative 5,474 5,126 15,954 14,912
------- ------- ------- -------
Total operating expenses 7,779 7,238 22,289 21,043
------- ------- ------- -------
Operating income 1,026 1,710 1,542 5,038
Interest income, net 181 210 478 344
------- ------- ------- -------
Income before provision for income taxes 1,207 1,920 2,020 5,382
Provision for income taxes 362 325 655 925
------- ------- ------- -------
Net income $ 845 $ 1,595 $ 1,365 $ 4,457
======= ======= ======= =======
Net income per share $ .10 $ .19 $ .16 $ .59
======= ======= ======= =======
Shares used in computing net income per share 8,464 8,357 8,409 7,508
======= ======= ======= =======
<FN>
See accompanying notes to condensed consolidated financial statements.
</FN>
</TABLE>
4
<PAGE>
<TABLE>
ADEPT TECHNOLOGY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
<CAPTION>
Nine months ended
------------------------------
March 29, March 30,
1997 1996
------------- --------------
<S> <C> <C>
Operating activities
Net income $ 1,365 $ 4,457
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 2,168 1,737
(Gain) Loss on disposal of property and equipment (1) (12)
Tax benefit from stock plans 73 -
Changes in operating assets and liabilities:
Accounts receivable 1,712 (4,665)
Inventories 309 (6,263)
Deferred tax assets and prepaid expenses (435) (936)
Other assets (47) (441)
Accounts payable (1,064) (353)
Accrued liabilities 1,914 2,802
-------- --------
Total Adjustments 4,629 (8,131)
-------- --------
Net cash provided by (used in) operating activities 5,994 (3,674)
-------- --------
Investing activities
Purchase of property and equipment, net (1,615) (1,446)
Proceeds from the sale of property and equipment 86 13
Purchases of long term investments (1,000) -
Purchases of available for sale investments (14,757) (12,500)
Sales of available for sale investments 12,877 11,500
-------- --------
Net cash used in investing activities (4,409) (2,433)
-------- --------
Financing activities
Principal payment for capital lease obligations (70) (224)
Proceeds from common stock issued under initial public
offering, employee stock incentive program, employee
stock purchase plan, net of repurchases, cancellations,
and payments of notes receivable from shareholders 813 10,294
-------- --------
Net cash provided by financing activities 743 10,070
-------- --------
Increase in cash and cash equivalents 2,328 3,963
Cash and cash equivalents, beginning of period 8,075 5,912
-------- --------
Cash and cash equivalents, end of period $ 10,403 $ 9,875
======== ========
Supplemental disclosure of noncash activities:
Inventory capitalized into property, equipment and related tax $ 497 $ 603
Cash paid during the period for:
Interest $ 11 $ 38
Taxes $ 470 $ 796
<FN>
See accompanying notes to condensed consolidated financial statements.
</FN>
</TABLE>
5
<PAGE>
ADEPT TECHNOLOGY, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
(in thousands)
1. General
The accompanying condensed consolidated financial statements have been
prepared in conformity with generally accepted accounting principles.
However, certain information or footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the
rules and regulations of the Securities and Exchange Commission. The
information furnished in this report reflects all adjustments which, in
the opinion of management, are necessary for a fair statement of the
consolidated financial position, results of operations and cash flows
as of and for the interim periods. Such adjustments consist of items of
a normal recurring nature. The condensed consolidated financial
statements included herein should be read in conjunction with the
audited financial statements and notes thereto for the fiscal year
ended June 30, 1996 included in the Company's Form 10-K as filed with
the Securities and Exchange Commission on September 30, 1996. Results
of operations for interim periods are not necessarily indicative of the
results of operations that may be expected for the full fiscal year
ending June 30, 1997 or for any other future period.
2. Financial Instruments
The Company determines the appropriate classification of its
investments in debt and equity securities at the time of purchase and
reevaluates such classification as of each balance sheet date. The
Company's short term investments consist of commercial paper and tax
exempt municipal bonds with initial maturities in excess of 90 days and
money market auction rate preferred stock and auction rate notes with
maturities of one year or less. They are classified as available for
sale, and as such are carried at fair value. Fair value is based upon
quoted market prices on the last day of the fiscal period. The
Company's long term investments consist of U.S. government agency
securities with initial maturities in excess of one year. The cost of
debt securities sold is based on the specific identification method.
The Company had no investments in equity securities at March 29, 1997
and June 30, 1996. During fiscal year 1996 and the nine months ended
March 29, 1997, realized and unrealized gains and losses on available
for sale investments were not material.
3. Inventories
Inventories are summarized as follows:
March 29, June 30,
1997 1996
---- ----
Raw materials $ 8,164 $ 9,488
Work-in-process 3,934 3,069
Finished goods 1,934 2,251
--------- ---------
$ 14,032 $ 14,808
========= =========
6
<PAGE>
ADEPT TECHNOLOGY, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
(in thousands)
4. Income taxes
The Company provides for income taxes during interim reporting periods
based upon an estimate of its annual effective tax rate. This estimate
reflects the utilization of tax credits, offset by taxes on the
Company's foreign operations.
5. Net income per share
Net income per share is computed using the weighted average number of
shares of common stock and dilutive common equivalent shares from
convertible preferred stock (using the if-converted method) and from
stock options and warrants (using the treasury stock method). Pursuant
to the Securities and Exchange Commission Staff Accounting Bulletins,
common stock and common equivalent shares issued by the Company at
prices below the assumed public offering price during the twelve-month
period prior to the initial public offering have been included in the
calculation through September 30, 1995 as if they were outstanding for
all periods.
6. Contingencies
The Company has from time to time received communications from third
parties asserting that the Company is infringing certain patents and
other intellectual property rights of others or seeking indemnification
against such alleged infringement. There is presently no litigation
involving such claims, and the Company believes that the ultimate
resolution, if any, of these matters will not have a material adverse
effect on its financial position, results of operations or cash flows.
7. Accounting Pronouncements
In February 1997, the Financial Accounting Standards Board issued
Statement No. 128, Earnings per Share, which is required to be adopted
on December 31, 1997. At that time, the Company will be required to
change the method currently used to compute earnings per share and to
restate all prior periods. Under the new requirements for calculating
primary earnings per share, the dilutive effect of stock options will
be excluded. The impact is not expected to result in a change in
primary earnings per share for the three months ended March 29, 1997.
It is, however, expected to result in an increase of $.02 per share for
the three months ended March 30, 1996 and an increase for the nine
months ended March 29, 1997 and March 30, 1996 of $.01 and $.07 per
share, respectively. The Company has not yet determined what the impact
of Statement 128 will be on the calculation of fully diluted earnings
per share.
8. Reclassification
Certain amounts presented in the financial statements for fiscal 1996
have been reclassified to conform to the presentation for fiscal 1997.
7
<PAGE>
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Special Note Regarding Forward-Looking Statements
Certain statements in the following Management's Discussion and Analysis of
Financial Condition and Results of Operations constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995 (the "Reform Act"). Such forward-looking statements involve known and
unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company, or industry results, to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Such factors include,
among other things, the following: the potential fluctuations in the Company's
quarterly and annual results of operations; the cyclicality of capital spending
of the Company's customers; the Company's dependence on the continued growth of
the intelligent automation market; the risks associated with sole or single
sources of supply and lengthy procurement lead times; the Company's highly
competitive industry; rapid technological change within the Company's industry;
the lengthy sales cycles for the Company's products; the risks associated with
reliance on system integrators; the risks associated with international sales
and purchases; the risks associated with potential acquisitions and the need to
manage growth; the risks associated with new product development and the need to
manage product transitions, including any difficulties or delays in the
development, production, testing and marketing of the Company's new products
under development; the Company's dependence on retention and attraction of key
employees; the risks associated with product defects; the Company's dependence
on third-party relationships; the uncertainty of patent and proprietary
technology protection and third party intellectual property claims; changes in,
or failure or inability to comply with, government regulations; general economic
and business conditions; the failure of any new products to be accepted in the
marketplace; any decreased investment in robotics generally, and in the
Company's intelligent automation products particularly, as a result of general
or specific economic conditions or conditions affecting any of the Company's
primary markets; decreased acceptance of the Company's current products in the
marketplace, and the other factors referenced in this Management's Discussion
and Analysis of Financial Condition and Results of Operations and the Company's
Annual Report on Form 10-K for the fiscal year ended June 30, 1996.
OVERVIEW
The Company designs, manufactures and markets intelligent automation software
and hardware products for assembly, material handling and packaging
applications. The Company's products currently include machine controllers for
robot mechanisms and other flexible automation equipment, machine vision
systems, simulation software and a family of mechanisms including robots, linear
modules and vision-based flexible part feeders.
The Company sells its products through system integrators, its direct sales
force and OEMs. System integrators and OEMs add application-specific hardware
and software to the Company's products, thereby enabling the Company to provide
solutions to a diversified industry base, including the electronics,
telecommunications, appliances, pharmaceutical, food processing and automotive
components industries. The Company's historical results of operations should not
be relied upon as an indication of future performance.
Results of Operations
Three Month and Nine Month Periods Ended March 29, 1997 and March 30, 1996
Net revenues. The Company's net revenues increased by 1.5% to $21.1 million for
the three months ended March 29, 1997 from $20.8 million for the three months
ended March 30, 1996. The Company's net revenues decreased by 4.6% to $58.4
million for the nine months ended March 29, 1997 from $61.2 million for the nine
months ended March 30, 1996. The increase in net revenues for the three month
period ended March 29, 1997 as compared to the three month period ended March
30, 1996 was primarily attributable to increased domestic product sales,
particularly robot sales, and to a lesser extent, to increased software revenue,
partially offset by a decrease in motion controller sales and service and
upgrade revenues. The reduction in net revenues
8
<PAGE>
for the nine month period ended March 29, 1997 as compared to the nine month
period ended March 30, 1996 was primarily attributable to decreased product
sales, particularly sales of motion controllers in the Company's international
and OEM markets, and to a lesser extent, to decreased service and upgrade
revenues, partially offset by an increase in robot sales. International sales,
including sales to Canada, were $6.5 million or approximately 30.9% of net
revenues for the three months ended March 29, 1997 as compared with $8.9 million
or approximately 42.9% of net revenues for the three months ended March 30,
1996. International sales, including sales to Canada, were $20.4 million or
approximately 34.9% of net revenues for the nine months ended March 29, 1997 as
compared with $24.0 million or approximately 39.2% of net revenues for the nine
months ended March 30, 1996.
Gross margin. Gross margin percentage was 41.7% for the three months ended March
29, 1997 and 43.0% for the three months ended March 30, 1996. The decrease in
gross margin was primarily attributable to a higher percentage of lower margin
mechanism system product sales and to the lower sales of higher margin motion
controller products. In addition, sales of lower margin mechanical subsystems
sourced from third parties increased quarter to quarter. These gross margin
reductions were partially offset by increased sales of higher margin simulation
software products from the Company's Silma business and increased gross margins
on service and upgrade revenues. Gross margin percentage was 40.8% for the nine
months ended March 29, 1997 and 42.6% for the nine months ended March 30, 1996.
The decrease in gross margin over the comparable nine month periods was
primarily attributable to a higher percentage of lower margin mechanism system
product sales and to the lower sales of higher margin motion controller
products. In addition, sales of lower margin mechanical subsystems sourced from
third parties increased over the comparable nine month periods. These gross
margin reductions were partially offset by increased gross margins on service
and upgrade revenues.
The Company expects that it will continue to experience quarterly fluctuations
in gross margin percentage due to changes in its sales and product mix.
Research, Development and Engineering. Research, development and engineering
expenses increased by 9.1% to $2.3 million for the three months ended March 29,
1997 from $2.1 million for the three months ended March 30, 1996. The Company's
research, development and engineering expenses increased by 3.3% to $6.3 million
for the nine months ended March 29, 1997 from $6.1 million for the nine months
ended March 30, 1996. Research, development and engineering expenses for the
three months ended March 29, 1997 were partially offset by $199,000 of third
party development funding, as compared with $260,000 of third party development
funding for the three months ended March 30, 1996. Research, development and
engineering expenses for the nine months ended March 29, 1997 were partially
offset by $711,000 of third party development funding, as compared with $559,000
of third party development funding for the nine months ended March 30, 1996. The
Company expects that it will continue to receive some third party development
funding from the federal and California state governments during the remainder
of fiscal 1997 and throughout fiscal year 1998; however, there can be no
assurance that any funds budgeted by either government for the Company's
development projects will not be curtailed or eliminated at any time. As a
percentage of net revenues, research, development and engineering expenses
increased to 10.9% for the three months ended March 29, 1997 from 10.2% for the
three months ended March 30, 1996. As a percentage of net revenues, research,
development and engineering expenses increased to 10.8% for the nine months
ended March 29, 1997 from 10.0% for the nine months ended March 30, 1996. For
the three month period ended March 29, 1997, research, development and
engineering expenses as a percentage of net revenues increased as compared with
the three month period ended March 30, 1996, primarily because of increases in
project material spending and to a lesser extent, to the decline in third party
development funding and increases in compensation related expenses, including
consulting expenses. For the nine month period ended March 29, 1997, research,
development and engineering expenses as a percentage of net revenues increased
as compared with the nine month period ended March 30, 1996, primarily because
of the decline in net revenues and to a lesser extent, because of increases in
compensation related expenses, including consulting expenses as well as project
material spending, partially offset by higher third party development funding.
Selling, General and Administrative. Selling, general and administrative
expenses increased 6.7% to $5.5 million or 25.9% of net revenues for the three
months ended March 29, 1997, as compared with $5.1 million or 24.6% of net
revenues for the three months ended March 30, 1996. Selling, general and
administrative expenses increased 7.0% to $16.0 million or 27.3% of net revenues
for the nine months ended March 29, 1997, as compared with $14.9 million or
24.4% of net revenues for the nine months ended March 30, 1996. This increased
spending for the three and nine month periods was primarily attributable to
investments in new product launches and promotions, higher depreciation
expenses, increased headcount and related expenses, and to a lesser extent, to
9
<PAGE>
employee merit compensation adjustments and additional administrative expenses
associated with being a public company. The Company expects that selling,
general and administrative expenses will continue to increase in absolute
dollars in future periods, although as a percentage of net revenues, selling,
general and administrative expenses may fluctuate in future periods.
Interest Income, Net. Interest income, net for the three months ended March 29,
1997 was $181,000, as compared with $210,000 for the three months ended March
30, 1996. Interest income, net for the nine months ended March 29, 1997 was
$478,000, as compared with $344,000 for the nine months ended March 30, 1996.
The increase for the nine month period was due to additional interest income
earned by the investment of cash proceeds from the sale of common stock in the
Company's initial public offering in December 1995, partially offset by lower
investment yields
Provision for Income Taxes. The Company's effective tax rate for the three and
nine month periods ended March 29, 1997 was 30% and 32% respectively, as
compared with 17% for the comparable periods ended March 30, 1996. The Company's
tax rate for fiscal year 1997 differs from the combined federal and state
statutory income tax rate primarily due to the benefit of federal and state tax
credits. The Company's 17% tax rate for fiscal year 1996 differs from the
combined federal and state statutory income tax rate primarily due to the
utilization of tax credit carryforwards and to a reduction in the valuation
allowance for deferred tax assets.
Significant Fluctuations in Operating Results
The Company's operating results have historically been, and will continue to be,
subject to significant quarterly and annual fluctuations due to a number of
factors, including fluctuations in capital spending domestically and
internationally or in one or more industries to which the Company sells its
products, new product introductions by the Company or its competitors, changes
in product mix and pricing by the Company, its suppliers or its competitors,
availability of components and raw materials, failure to manufacture a
sufficient volume of products in a timely and cost-effective manner, failure to
introduce new products on a timely basis, failure to anticipate changing
customer product requirements, lack of market acceptance or shifts in the demand
for the Company's products, changes in the mix of sales by distribution channel,
changes in the spending patterns of the Company's customers, and extraordinary
events such as litigation or acquisitions. The Company's gross margins may vary
greatly depending on the mix of sales of lower margin hardware products,
particularly mechanical subsystems sourced from third parties, and higher margin
software products. The Company's operating results will also be affected by
general economic and other conditions affecting the timing of customer orders
and capital spending. The Company generally recognizes product revenue upon
shipment or, for certain international sales, upon receipt by the customer. The
Company's net revenues and results of operations for a fiscal period will
therefore be affected by the timing of orders received and orders shipped during
such period. A delay in shipments near the end of a fiscal period, due for
example to product development delays or to delays in obtaining materials, could
materially adversely affect the Company's business, financial condition and
results of operations for such period. Moreover, continued investments in
research and development, capital equipment and ongoing customer service and
support capabilities will result in significant fixed costs which the Company
will not be able to reduce rapidly and, therefore, if the Company's sales for a
particular fiscal period are below expected levels, the Company's business,
financial condition and results of operations for such fiscal period could be
materially adversely affected. In addition, while in some years revenue from
international sales has helped buffer the Company against slowdowns in U.S.
capital spending, in other years the higher costs associated with international
sales, combined with downturns in international markets, have adversely affected
the Company's results of operations. There can be no assurance that the Company
will be able to increase or sustain profitability on a quarterly or annual basis
in the future.
The Company has experienced and is expected to continue to experience
seasonality in product bookings. The Company has typically had higher bookings
for its products during the June quarter of each fiscal year and lower bookings
during the September quarter of each fiscal year, due primarily to the slowdown
in sales to European markets. The Company has generally been able to maintain
revenue levels during the September fiscal quarter by utilizing backlog from the
June fiscal quarter. In the event bookings for the Company's products in the
June fiscal quarter are lower than anticipated and the Company's backlog at the
end of the June fiscal quarter is insufficient to compensate for lower bookings
in the September fiscal quarter, the Company's results of operations for the
September fiscal quarter and future quarters could be materially adversely
affected. In fact, in
10
<PAGE>
the June quarter of fiscal 1996, sales were lower than anticipated due to
competitive pressures and organizational issues with respect to the Company's
Silma business. In addition, in the September quarter of fiscal 1997, sales to
European and other international markets decreased substantially, as several
large orders were delayed by customers. The decrease in product bookings
resulted in decreased net revenues for the September quarter of fiscal 1997.
A significant percentage of the Company's product shipments occur in the last
month of each fiscal quarter. Historically this has been due to a lack of
component availability from sole or single source suppliers or, with respect to
components with long procurement lead times, due to inaccurate forecasting of
the level of demand for the Company's products or of the product mix for a
particular fiscal quarter. The Company has therefore from time to time been
required to utilize components and other materials for current shipments which
were scheduled to be incorporated into products to be shipped in subsequent
periods. If the Company were unable to obtain additional components or
mechanical subsystems to meet increased demand for its products, or to meet
demand for a product mix which differed from the forecasted product mix, or if
for any reason the Company failed to ship sufficient product prior to the end of
the fiscal quarter, the Company's business, financial condition and results of
operations could be materially adversely affected.
Liquidity and Capital Resources
The Company completed its initial public offering of common stock in December
1995, raising approximately $10.0 million net of offering expenses. Prior to
December 1995, the Company financed its operations through private sales of
equity securities, cash flow from operations, capital equipment leases, and bank
lines of credit. As of March 29, 1997, the Company had working capital of
approximately $36.4 million, including $10.4 million in cash and cash
equivalents and $4.8 million in short term investments. The Company also had
long term investments in U.S. government agencies of $1.0 million.
The Company's operating activities provided cash of $6.0 million and used cash
of $3.7 million for the nine months ended March 29, 1997 and March 30, 1996,
respectively. The cash provided by operating activities in the nine months ended
March 29, 1997 was primarily attributable to net income from operations, as
adjusted by the effects of depreciation and amortization, and to a lesser
extent, to the decrease in accounts receivable arising from increased
collections.
Net cash used in investing activities was $4.4 million for the nine months ended
March 29, 1997, due to net purchases of investments of $2.9 million, purchases
of property and equipment aggregating $1.6 million. The Company currently
anticipates capital expenditures of approximately $2.5 million during fiscal
1997, including approximately $700,000 for test fixtures, tooling and other
factory investments, approximately $500,000 for MIS equipment and approximately
$1.3 million for laboratory and other equipment.
The Company believes that the existing cash and cash equivalent balances as well
as short term investments and anticipated cash flow from operations will be
sufficient to support the Company's working capital requirements for at least
the next twelve months.
PART II - OTHER INFORMATION
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
a) The Exhibits listed on the accompanying index immediately following the
signature page are filed as part of this report.
(b) Reports on Form 8-K. No reports on Form 8-K were filed by the Company
during the quarter ended March 29, 1997.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ADEPT TECHNOLOGY, INC.
Date: May 12, 1997 By: /s/ Brian R. Carlisle
------------------------------
Brian R. Carlisle
Chairman of the Board and
Chief Executive Officer
Date: May 12, 1997 By: /s/ Betsy A. Lange
------------------------------
Betsy A. Lange
Vice President of Finance and
Chief Financial Officer
12
<PAGE>
INDEX TO EXHIBITS
SEQUENTIALLY
NUMBERED
EXHIBITS PAGE
- --------------------------------------------------------------------------------
11.1 Statement of Computation of Net Income Per Share. 14
27.1 Financial Data Schedule. 15
13
Exhibit 11.1
<TABLE>
ADEPT TECHNOLOGY, INC.
Statement of Computation of Net Income Per Share
(in thousands, except per share data)
(unaudited)
<CAPTION>
Three months ended Nine months endeed
-------------------- --------------------
March 29, March 30, March 29, March 30,
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net income $ 845 $1,595 $1,365 $4,457
====== ====== ====== ======
Weighted average common stock outstanding 8,091 7,537 8,019 6,769
Weighted average common stock equivalent shares 373 820 390 707
Shares related to SAB No. 55, 64, and 83 -- -- -- 32
------ ------ ------ ------
Shares used to compute net income per share 8,464 8,357 8,409 7,508
====== ====== ====== ======
Net income per common share $ .10 $ .19 $ .16 $ .59
====== ====== ====== ======
</TABLE>
14
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED CONSOLIDATED BALANCE SHEET AS OF MARCH 29, 1997 AND THE CONDENSED
CONSOLIDATED STATEMENT OF INCOME FOR THE NINE MONTHS ENDED MARCH 29, 1997 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JUL-01-1996
<PERIOD-END> MAR-29-1997
<CASH> 10,403
<SECURITIES> 4,780
<RECEIVABLES> 19,246
<ALLOWANCES> 463
<INVENTORY> 14,032
<CURRENT-ASSETS> 50,688
<PP&E> 18,486
<DEPRECIATION> 12,495
<TOTAL-ASSETS> 59,357
<CURRENT-LIABILITIES> 14,282
<BONDS> 0
<COMMON> 46,269
0
0
<OTHER-SE> (1,195)
<TOTAL-LIABILITY-AND-EQUITY> 59,357
<SALES> 58,428
<TOTAL-REVENUES> 58,428
<CGS> 34,597
<TOTAL-COSTS> 56,886
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 9
<INCOME-PRETAX> 2,020
<INCOME-TAX> 655
<INCOME-CONTINUING> 1,365
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,365
<EPS-PRIMARY> 0.16
<EPS-DILUTED> 0.16
</TABLE>
