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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
September 29, 1997
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Date of Report
(Date of Earliest Event Reported)
TOPRO, INC.
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(Exact name of Registrant as specified in its charter)
Colorado 0-19167 84-1042227
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(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File No.) I. D. Number)
2525 West Evans Avenue, Denver, Colorado 80219
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(Address of principal executive offices) (zip code)
(303) 935-1221
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(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS.
Information from the Company's Press Release dated September 29, 1997,
which is filed as Exhibit 20.1 hereto, is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Not applicable
(b) Not applicable
(c) Exhibits. The following exhibit is filed with this Report:
20.1 Press Release dated September 29, 1997
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Topro, Inc.
Date: September 29, 1997 By: /s/ John Jenkins
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John Jenkins, President and CEO
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EXHIBIT 20.1
PRESS RELEASE
For Immediate Release September 29, 1997
TOPRO, INC. ANNOUNCES YEAR END RESULTS FOR 1997
September 29, 1997 - Topro, Inc., d.b.a. TAVA Technologies, (Nasdaq:TPRO)
Denver, Colorado, a leading provider of automation and information technology
solutions to industry, announced preliminary results for fiscal year ending
June 30, 1997. Final results will be available pending the completion of the
Company's audit.
Revenues for the year increased by 79% to $36,843,000 from $20,633,000 for the
year ending June 30, 1996. Topro's gross profit improved 110% to $12,521,000
(34% of revenue) from $5,956,000 (29% of revenue) in 1996. The Company recorded
an expense provision for doubtful accounts of $944,000 for the year. Topro has
reported a net loss for the year of $2,485,000 ($.028 per share).
With regard to continuing operations, John Jenkins, CEO said, "We are pleased
with the increase in revenues and particularly the significant year to year
increase in gross margins to 34% from 29% in the prior year. The gross
margin improvement reflects positively on our continued efforts to improve
product mix."
"Earnings before interest, taxes, depreciation, amortization and gain on sale of
assets before provision for doubtful accounts was $1,236,000 or greater than a
100% increase over the comparable figure in 1996. This additional provision
increased our allowance for doubtful accounts to $2,075,000," states Jenkins.
Jenkins explains, "We increased the allowance account based on our review of
the current collectability of specific receivables, particularly those
involved in any claim process, and our recognition of the general risks
associated with larger receivables resulting from Topro's execution of larger
projects. We believe this new balance, plus other balance sheet reserves of
$520,000 provide an appropriate buffer against future income statement
impact."
Jenkins also noted that the Company's addition of Douglas H. Kelsall as CFO
in late June, 1997 was an important step in bringing the acquired companies
to consistent application of accounting policies, and strengthening financial
reporting.
"The Company continues to focus on reducing expenses through consolidating
administrative functions and centralizing finance and accounting functions,
however," Kelsall stated, "the planned progress in the fourth quarter was
setback by the necessary dedication of management resources to our Year 2000
business initiative."
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Kelsall noted that SG&A expenses increased 104% for the year but added that the
Company was investing heavily in structuring a national sales organization and
establishing common operating methodologies across the acquired companies.
Kelsall also pointed out that subsequent to June 30, 1997, Topro received cash
proceeds in excess of $4,616,000 from the exercise of options and warrants for
3,001,000 shares of common stock and the holders of Topro's subordinated debt
had converted $2,685,000 of debt to equity in exchange for 1,790,000 common
shares. The additional cash proceeds and reduction in long term debt
significantly improved the Company's balance sheet and overall financial
strength. The Proforma balance sheet shows an improvement in stockholders
equity of $7,301,000.
As an update to the Company's initiative into year 2000 activity, Jenkins, CEO
offered the following:
"The Company's initiative into year 2000 compliance at the industrial process
and manufacturing control level is gaining strong momentum. We remain on
schedule for the mid- to late October release of our CD-ROM based methodology
and tools, and are pleased with the external reviews received on our
methodology, content and database structure through demonstrations of the
product components.
Since the launch of the Plant Y2K One service and product offering in early
July, we have secured more than a dozen engagements from Fortune 500 clients;
have received requests for proposals from over 20 large, multi-plant
organizations that cover approximately 900 plant sites; and have been approached
with proposals to address international markets. This activity is the result of
our direct selling, as distribution through other channels will not begin until
the CD-ROM release in mid-to late October.
In addition to our other previously announced distribution channel developments,
we have finalized a strategic alliance with Fluor Daniel, Inc., a leading global
engineering and construction company. Among other elements, the alliance
provides for joint marketing of our Plant Y2K One products and services to the
Flour Daniel client base.
While the awareness of and momentum in year 2000 factory level compliance is
building rapidly, many clients are still stepping cautiously, choosing to do
'pilot' projects before launching a full program. As a result, we expect that
it will be the third quarter of our fiscal 1998 before we begin to see
significant revenue impact on the Company. Meanwhile, we are continuing to
invest heavily in methodology and tool development.
We continue to see Y2K One activity as a direct complement to our corporate
business."
Contacts:
Topro, Inc. Pacific Consulting Group, Inc.
John Jenkins Scott Liolios
(303) 935-1221 (714) 574-3860
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TOPRO, INC.
June 30, 1997 June 30, 1996
Revenue $36,843,000 $20,633,000
Cost of Revenue 24,322,000 14,677,000
Gross Margin 12,521,000 5,956,000
Sales, General & Administrative Expense 11,401,000 5,577,000
Allowance for Doubtful Accounts 944,000 51,000
Depreciation Expense 767,000 296,000
Amortization of Cap. software & Goodwill 815,000 150,000
Total Expense 13,927,000 6,074,000
Operating Income (1,406,000) (118,000)
Other Income (expense)
Gain on sale of assets 8,000 435,000
Interest Expense (987,000) (380,000)
Other 116,000 79,000
Total Other Income and Expenses (863,000) 134,000
Income (Loss from Continuing Ops) (2,269,000) 16,000
Income Tax 110,000 --
Discontinued Operations (106,000) (1,871,000)
Net Loss (2,485,000) (1,855,000)
Weighted Average Shares 8,882,000 4,655,000
Loss per Share $ (0.28) $ (0.40)
Earnings before interest, taxes, 292,000 407,000
depreciation, amortization and gain on
sale of assets, from continuing
operations
Earnings before Interest, Taxes, 1,236,000 458,000
Depreciation, Amortization, gain on sale of
assets before Provision for allowance for
doubtful accounts
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TOPRO, INC.
AS OF JUNE 30, 1997 AND PROFORMA
PROFORMA
ASSETS
Current Assets $13,098,000 $15,406,000
Fixed Assets net of depreciation 2,633,000 2,633,000
Goodwill 8,938,000 8,938,000
Other Assets 2,617,000 2,617,000
TOTAL ASSETS $27,286,000 $29,594,000
LIABILITIES AND OWNERS EQUITY
Current Liabilities $13,138,000 $10,830,000
Long Term Liabilities 5,422,000 2,737,000
Owners Equity 8,726,000 16,027,000
Total Liabilities and Owners Equity $27,286,000 $29,594,000
Proforma includes cash received from exercise of warrants and options and
conversion of long term debt subsequent to June 30, 1997 but does not reflect
costs or expenses of operations or other events.
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