SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1995 OR
( ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT FOR
THE TRANSITION PERIOD FROM __________ TO __________
Commission file number 0-439
American Locker Group Incorporated
_______________________________________________________________
(Exact name of small business issuer as specified in its charter)
Delaware 16-0338330
____________________________ _______________________________
(State of other jurisdiction (I.R.S. Employer Identification
of incorporation or Number)
organization)
15 West Second Street, Jamestown, New York 14701
________________________________________________________________
(Address of principal executive offices)
(Zip Code)
(716) 664-9600
________________________________________________________________
(Registrant's telephone number, including area code)
__________________________________________________________________________
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act during the past
12 months (or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing requirements
for the past 90 days.
Yes X No ___
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING
THE PRECEDING FIVE YEARS:
Check whether the registrant filed all documents and reports required
to be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court.
Yes ___ No ___ Not Applicable
APPLICABLE ONLY TO CORPORATE ISSUERS:
State the number of shares outstanding of each of the issuer's class of
common stock equity as of the latest practicable date: MAY 1, 1995
Common Stock $1.00 par value - 858,876
Transitional Small Business Disclosure (check one) Yes ___ No X
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
STATEMENTS OF CONSOLIDATED FINANCIAL CONDITION
AMERICAN LOCKER GROUP INCORPORATED AND SUBSIDIARIES
March 31, December 31,
1995 1994
___________ ____________
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 388,739 $ 315,685
Accounts receivable, less
allowance for doubtful accounts
(1995 $75,967; 1994 $65,900) 2,818,886 4,070,723
Inventories 2,991,402 2,105,537
Notes receivable 116,173 128,779
Prepaid expenses 184,149 187,001
Deferred income taxes 502,075 502,047
___________ ___________
TOTAL CURRENT ASSETS 7,001,424 7,309,772
PROPERTY, PLANT AND EQUIPMENT
Land 500 500
Buildings 493,636 489,986
Machinery and equipment 6,453,715 6,365,812
___________ ___________
6,947,851 6,856,298
Less allowances for depreciation
and amortization 6,032,267 5,941,203
___________ ___________
915,584 915,095
___________ ___________
TOTAL NON-CURRENT ASSETS 915,584 915,095
___________ ___________
TOTAL ASSETS $ 7,917,008 $ 8,224,867
=========== ===========
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<PAGE>
STATEMENTS OF CONSOLIDATED FINANCIAL CONDITION
AMERICAN LOCKER GROUP INCORPORATED AND SUBSIDIARIES
March 31, December 31,
1995 1994
___________ _____________
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES
Demand note payable $ 0 $ 1,200,000
Accounts payable and accrued
expenses:
Trade 786,848 865,244
Related party 460,382 610,922
___________ ___________
1,247,230 1,476,166
Commissions, salaries, wages and
taxes thereon 208,817 246,547
Other accrued expenses 644,260 480,868
Federal and State income taxes
payable 495,616 21,246
Current potion of long-term
obligations 600,000 600,000
___________ ___________
TOTAL CURRENT LIABILITIES 3,195,923 4,024,827
DEFERRED INCOME TAXES 3,364 3,337
LONG-TERM OBLIGATIONS
Long term debt, less current
portion 750,000 900,000
Deferred pension income 174,542 174,542
Postretirement benefits 116,510 116,510
___________ ___________
1,041,052 1,191,052
___________ ___________
TOTAL NON-CURRENT LIABILITIES 1,004,416 1,194,389
___________ ____________
TOTAL LIABILITIES 4,240,339 5,219,216
STOCKHOLDERS' EQUITY
Common stock, par value $1 per
share--authorized 4,000,000
shares, issued 858,876 shares 858,876 858,876
Other capital 1,571,970 1,571,970
Retained earnings 1,376,546 709,782
Foreign exchange (130,723) (134,977)
___________ ____________
TOTAL STOCKHOLDERS' EQUITY 3,676,669 3,005,651
___________ ____________
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 7,917,008 $ 8,224,867
=========== ===========
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STATEMENTS OF CONSOLIDATED OPERATIONS
AMERICAN LOCKER GROUP INCORPORATED AND SUBSIDIARIES
Three Months Ended March 31,
1995 1994
______________ ____________
Net sales $ 7,080,084 3,473,596
Cost of products sold 4,702,320 2,449,667
______________ ____________
2,377,764 1,023,929
Selling, administrative and
general expenses 1,197,698 1,157,188
______________ ____________
1,180,066 (133,259)
Interest and dividend income 17,133 4,814
Other income--net 77,639 55,461
Interest expense (59,672) (26,609)
______________ ____________
INCOME (LOSS) BEFORE INCOME
TAXES 1,215,166 (99,593)
Income taxes (credits) 548,401 (38,980)
______________ ____________
NET INCOME (LOSS) $ 666,765 $ (60,613)
============== ============
NET INCOME (LOSS) PER SHARE
OF COMMON SHARE $ 0.78 $ (0.07)
============== ============
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STATEMENTS OF CONSOLIDATED CASH FLOWS
AMERICAN LOCKER GROUP INCORPORATED AND SUBSIDIARIES
Three Months Ended March 31,
1995 1994
______________ ____________
Cash flows from operating
activities:
Net income (loss) from
operations $666,765 ($60,613)
Adjustments to reconcile net
income (loss) from operations
to net cash provided by (used
in) operating activities:
Depreciation and amortization 91,063 154,177
(gain) on disposition of
property, plant and equipment 0 (12,468)
Change in assets and liabilities:
Accounts receivable 1,251,837 (257,309)
Inventories (885,865) (7,466)
Notes receivable 12,606 125,080
Prepaid expenses 2,852 (33,059)
Accounts payable and accrued
expenses (103,274) (40,390)
Income taxes 474,370 (52,046)
___________ ___________
NET CASH USED IN OPERATING
ACTIVITIES 1,510,354 (184,094)
Cash flows from investment activities:
Purchase of property, plant and
equipment (91,553) (44,701)
Proceeds from sale of property,
plant and equipment 0 16,625
___________ ___________
NET CASH USED IN INVESTING
ACTIVITIES (91,553) (28,076)
Cash flows from financing activities:
Net (payments) borrowings under
line of credit (1,200,000) 550,000
Debt repayments (150,000) (150,000)
Common stock purchase and
retired 0 (29,425)
___________ ___________
NET CASH PROVIDED BY
FINANCING ACTIVITIES (1,350,000) 370,575
___________ ___________
Effect of exchange rate changes
on cash 4,254 (16,312)
___________ ___________
Net increase in cash 68,801 158,405
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Cash and cash equivalents at
beginning of year 315,684 317,625
___________ ___________
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $388,739 $459,718
=========== ===========
Supplemental cash flow information:
Interest $59,672 $26,609
=========== ===========
Income Taxes $73,000 $57,375
=========== ===========
The notes are an integral part of the consolidated financial statements.
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<PAGE>
NOTES TO CONSOLIDATED FINANCIAL INFORMATION
AMERICAN LOCKER GROUP INCORPORATED AND SUBSIDIARIES
1. The accompanying unaudited consolidated condensed financial statements
have been prepared in accordance with instructions to Form 10-QSB and, in
the opinion of the Company, include all adjustments, consisting of normal
recurring accruals, considered necessary for a fair presentation of such
condensed financial statements. The condensed financial statements do not
include all information and footnotes normally associated with statements
of results of operation, financial condition, and cash flows prepared in
conformity with generally accepted accounting principles.
2. Provision for income taxes is based upon the estimated annual
effective tax rate.
3. Net income (loss) per common share is computed by dividing net loss by
the weighted average number of shares outstanding, plus, when dilutive, the
common stock equivalents which would arise from the exercise of stock
options, during the period (858,876 at March 31, 1995 and 868,673 at March
31, 1994).
4. Inventories are valued at the lower of cost or market. Cost is
determined by using the last-in, first-out method for substantially all of
the inventories.
March 31, December 31,
1995 1994
____________ ____________
Continuing Operations
Raw materials $ 1,129,601 $ 1,104,489
Work-in-process 1,245,910 1,266,263
Finished goods 1,558,293 677,187
____________ ____________
$ 3,933,804 $ 3,047,939
Less allowance to
reduce carrying
value to LIFO
basis 942,402 942,402
____________ ____________
Net Inventories $ 2,991,402 $ 2,105,537
============ ============
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AMERICAN LOCKER GROUP INCORPORATED AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
LIQUIDITY AND SOURCES OF CAPITAL
________________________________
The Company continues to have adequate resources and liquidity to
maintain its operations. Working capital at March 31, 1995 was $3,805,000
up $520,000 from working capital of $3,285,000 at December 31, 1994. The
ratio of current assets to current liabilities was 2.2 to 1 at March 31,
1995, compared to 1.8 to 1, at December 31, 1994. The increased working
capital resulted primarily from the first quarter's profitable operations.
Cash provided from operations was $1,510,000 during the first three months
of 1995, compared to cash used in operating activities of $184,000 for the
same period in 1994. The significant improvement in cash provided by
operating activities is a result of profitable operations in the first
quarter of 1995 and the realization of December 31, 1994 accounts
receivable relating to significant shipments made to the United States Postal
Service (USPS) in late 1994. Cash generated from operations was used
principally to pay off borrowings under the Company's line of credit. The
Company's $3,000,000 line of credit is available to assist in satisfying
future working capital needs, if required.
The Company anticipates that its requirements for funds for operations and
capital expenditures will be provided principally from cash generated from
future operations.
FIRST THREE MONTHS 1995 VS. FIRST THREE MONTHS 1994
___________________________________________________
Sales for the first quarter of 1995 of $7,080,000 were up $3,606,000
(104%) compared to first quarter sales of $3,474,000 in 1994. Plastic
locker sales in the first quarter were $4,541,000, compared to $1,187,000,
during the same period in 1994. The increased plastic locker sales relate
to a significant contract awarded to the Company on November 7, 1994 to
provide plastic parcel lockers (CBU's) to the USPS. During the first quarter
of 1995, the Company completed delivery of 3,633 CBU units, representing the
first major schedule release of CBU units required by USPS. Sales of plastic
lockers products are expected to remain strong throughout 1995 as the Company
continues to ship CBUs under the USPS contract. All other sales, metal and
electronic, were $2,539,000 for the first three months of 1995 compared to
$2,287,000 in the first quarter of 1994. This increase related a general
increase in demand across all markets served by the Company.
Consolidated cost of products sold as a percentage of sales was 66.4%
during the first quarter of 1995 compared to 70.5% in the first three
months of 1994. Increased gross margins on sales represented better
absorption of fixed overhead costs associated with the increased volumes.
Current margins on the CBU units will be reduced by approximately one half,
as the sale price on the first 20,000 units shipped include a reimbursement
for the Company's investment in tooling required to produce the CBU type
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III product. Through March 31, 1995, 6,435 CBU Type III units have been
shipped to USPS under the contract.
Selling, general and administrative costs for the first quarter of
1995 remain relatively comparable to the same period in 1994 ($1,198,000 -
1995; $1,157,000 - 1994), increasing only 3.5%. Selling, general and
administrative costs represented 16.9% of sales in the first quarter of
1995, down from 33.5% of sales for the same period in 1994.
Other income net of $77,600 in the first quarter of 1995 was up
$22,000 from $55,600 recorded in the first three months of 1994,
principally due to discounts from purchase of materials for the CBU product.
Interest expense for the first quarter of 1995 increased $33,000 from
1994 due to an increase in the average balance outstanding under the
Company's working capital line of credit and increased interest rates.
Increased borrowings were required to support the volume of business with
the USPS.
ACCOUNTING CHANGES
__________________
The Company provides certain life insurance benefits to its retirees.
Effective January 1, 1993, pursuant to "Statement of Accounting Standards
No. 106 - Employers Account for Postretirement Benefits Other Than
Pension", the Company has changed its method of accounting for these
benefits by expensing life insurance benefits as employees render service
instead of when the benefits are paid. The transition effect, ($105,054,
less income taxes of $41,992), reduced earnings by $.07 per share.
Effective January 1, 1993, the Company adopted the provisions of FASB
Statement No. 109, "Accounting for Income Taxes". Prior to the adoption of
Statement 109, income tax expense was determined using the deferred method.
The cumulative effect of this accounting change reduced earnings by $76,466
or $.08 per share.
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PART II
_______
Item 6. Exhibits and Reports on Form 8-K
______ ________________________________
(a) None
(b) None
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<PAGE>
S I G N A T U R E
- - - - - - - - -
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.
AMERICAN LOCKER GROUP INCORPORATED
__________________________________
(Registrant)
By /s/ Harold J. Ruttenberg
________________________________
Harold J. Ruttenberg
Chairman, Chief Executive Officer,
Treasurer and Principal Accounting
Officer
Date May 12, 1995
____________
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