UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED FEBRUARY 28, 1998
Commission File No. 0-21816
PML, INC.
(Name of small business issuer in its charter)
Delaware 93-1116123
------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
27120 SW 95TH Avenue
Wilsonville, Oregon 97070
------------------------------------------------------------
(Address of principal executive offices, including zip code)
(503) 570-2500
---------------------------
(Issuer's telephone number)
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 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
--- ---
As of March 31, 1998 there were 1,780,441 shares of Common Stock with $0.01
par value outstanding, and 211,551 Class B Common Shares with $0.01 par value
outstanding.
<PAGE>
PML, INC.
Index
Part I. Financial Information
Item 1. Financial Statements 2
Consolidated Balance Sheets 3
Consolidated Statements of Operations 4
Consolidated Statements of Stockholders' Equity 5
Consolidated Statements of Cash Flows 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussions and Analysis of
Financial Condition and Results of Operations 9
Part II. Other Information
Item 1. Legal Proceedings 12
Item 4. Submission of Matters to a Vote of Security Holders 12
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 12
<PAGE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
----------------
PML, INC.
For the Third Quarter Ended
February 28, 1998
- 2 -
<PAGE>
<TABLE>
<CAPTION>
PML, INC.
CONSOLIDATED BALANCE SHEETS
Unaudited
February 28, May 31,
Assets 1998 1997
-------------- --------------
<S> <C> <C>
Current Assets:
Cash $ 30,983 $ 74,410
Trade accounts receivable, less allowance for doubtful 2,129,911 1,773,446
accounts of $71,616 and $81,609
Inventories:
Raw Materials 993,302 756,388
Work in Process 37,160 4,583
Finished Goods 773,399 699,093
Deferred income taxes 277,200 318,854
Prepaid expenses and other current assets 33,206 70,669
-------------- --------------
Total Current Assets 4,275,161 3,697,443
Property, plant and equipment - net 1,808,669 1,717,951
Intangible assets - net 57,573 64,801
Other assets 89,069 83,554
-------------- --------------
Total Assets $ 6,230,472 $ 5,563,749
============== ==============
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable $ 1,145,610 $ 1,054,462
Accrued salaries and wages 178,595 375,249
Accounts payable - related parties 773 2,175
Other accrued liabilities 328,984 364,076
Notes payable - related parties 247,551 247,550
Bank line of credit 2,008,129 1,248,928
Current portion of borrowings - related parties 66,641 69,073
Current portion of borrowings 301,723 236,717
-------------- --------------
Total Current Liabilities 4,278,006 3,598,230
-------------- --------------
Borrowings - related parties less current portion 135,573 164,958
Borrowings, less current portion 851,560 890,753
-------------- --------------
Total Borrowings. less current portion 987,133 1,055,711
-------------- --------------
Stockholders' Equity
Preferred stock, $.01 par value; authorized 25,000 shares,
no shares issued or outstanding - -
Class A convertible preferred stock, stated and liquidation
value $100 per share; authorized 7,500 shares, issued and
outstanding 4,950 shares, including accreted dividends 678,584 641,561
Common stock, $.01 par value; authorized 2,500,000 shares,
issued and outstanding 1,780,441 and 1,776,816 shares respectively 17,804 17,768
Class B common stock, $.01 par value; authorized 250,000 shares,
issued and outstanding 211,551 shares. 2,116 2,116
Class D common stock, $.01 par value, authorized 100 shares,
no shares issued or outstanding. - -
Additional Paid In Capital 146,540 144,701
Accumulated Equity 120,289 103,662
-------------- --------------
Total Stockholders' Equity 965,333 909,808
-------------- --------------
Total Liabilities and Stockholders' Equity $ 6,230,472 $ 5,563,749
============== ==============
</TABLE>
The accompanying notes are an integral part of this statement.
- 3 -
<PAGE>
<TABLE>
<CAPTION>
PML, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For The Three Months Ended For The Nine Months Ended
February 28, February 28,
1998 1997 1998 1997
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Net sales $ 3,472,101 $ 3,280,227 $ 10,437,597 $ 9,907,332
Cost of goods sold 2,093,037 1,955,143 6,385,122 6,088,873
-------------- -------------- -------------- --------------
Gross profit 1,379,064 1,325,084 4,052,475 3,818,459
Selling, general, and
administrative expenses 1,259,573 1,139,589 3,680,858 3,381,179
-------------- -------------- -------------- --------------
Operating income 119,491 185,495 371,617 437,280
Other expense (income):
Interest expense 88,356 73,064 253,117 210,054
Other (10,426) 9,794 19,325 (1,792)
-------------- -------------- -------------- --------------
Total other expense 77,930 82,858 272,442 208,262
-------------- -------------- -------------- --------------
Income before income taxes 41,561 102,637 99,175 229,018
Income tax expense 17,518 2,264 45,525 9,328
-------------- -------------- -------------- --------------
Net income $ 24,043 $ 100,373 $ 53,650 $ 219,690
============== ============== ============== ==============
Net income per share - basic $ 0.01 $ 0.04 $ 0.01 $ 0.09
============== ============== ============== ==============
Net income per share - diluted $ 0.01 $ 0.04 $ 0.01 $ 0.09
============== ============== ============== ==============
</TABLE>
The accompanying notes are an integral part of this statement.
- 4 -
<PAGE>
<TABLE>
<CAPTION>
PML, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY Unaudited
Class A Retained
Convertible Class B Additional Earnings
Preferred Common Common Paid-in (Accumulated
Shares Shares Shares Capital Deficit) Total
---------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Balance, May 31, 1995 $ 580,820 $ 14,497 $ 2,116 $ - $ (673,623) $ (76,190)
Common Stock returned and canceled - (27) - 27 - -
Preferred Stock dividends accreted 49,500 - - - (49,500) -
Stock issued to employees as compensation - 1,870 - 68,255 - 70,125
FY 1995 401k stock match issued in FY 1996 - 432 - 40,069 - 40,501
Conversion of accreted dividends to Common Stock (37,346) 996 - 36,350 - -
Net income - - - - 206,001 206,001
---------------------------------------------------------------------------
Balance, May 31, 1996 $ 592,974 $ 17,768 $ 2,116 $ 144,701 $(517,122) $ 240,437
===========================================================================
Balance, May 31, 1996 $ 592,974 $ 17,768 $ 2,116 $ 144,701 $(517,122) $ 240,437
Preferred Stock dividends accreted 48,587 - - - (48,587) -
Net income - - - - 669,371 669,371
---------------------------------------------------------------------------
Balance, May 31, 1997 $ 641,561 $ 17,768 $ 2,116 $ 144,701 $ 103,662 $ 909,808
===========================================================================
Balance, May 31, 1997 $ 641,561 $ 17,768 $ 2,116 $ 144,701 $ 103,662 $ 909,808
Preferred Stock dividends accreted 37,023 - - - (37,023) -
Common Stock returned and cancelled - (1) - 1 - -
Stock options exercised - 37 - 1,838 - 1,875
Net income - - - - 53,650 53,650
---------------------------------------------------------------------------
Balance, February 28, 1998 $ 678,584 $ 17,804 $ 2,116 $ 146,540 $ 120,289 $ 965,333
===========================================================================
</TABLE>
The accompanying notes are an integral part of this statement.
- 5 -
<PAGE>
<TABLE>
<CAPTION>
PML, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For The Nine Months Ended
February 28,
1998 1997
-------------------------------
<S> <C> <C>
Cash Flows from Operating Activities:
Net income $ 53,650 $ 219,690
Adjustments to reconcile net income to
net cash provided by (used in) operating activities:
Depreciation and amortization 261,442 204,497
Gain on sale of equipment (26,893) 13,183
Changes in:
Accounts receivable (356,465) (57,749)
Inventories (343,797) 75,745
Deferred income taxes 41,654 -
Other assets 35,889 (88,503)
Accounts payable and accrued liabilities (141,999) (174,383)
------------- -------------
Total adjustments (530,169) (27,210)
------------- -------------
Net cash (used in) provided by operating activities (476,519) 192,480
Cash Flows from Investing Activities:
Proceeds from sale of assets 33,462 16,517
Purchase of property, plant and equipment (355,442) (170,789)
------------- -------------
Net cash used in investing activities (321,980) (154,272)
Cash Flows from Financing Activities:
Net proceeds (repayment) of bank credit line 759,201 (103,227)
Proceeds from issuance of notes payable 70,828 167,532
Repayment of notes payable (8,254) (175,597)
Proceeds from issuance of long-term debt 149,864 505,082
Repayment of long-term debt (218,442) (368,526)
Proceeds from issuance of common stock 1,875 0
------------- -------------
Net cash provided by financing activities 755,072 25,264
------------- -------------
(Decrease)/increase in cash (43,427) 63,472
Cash at beginning of period 74,410 9,887
------------- -------------
Cash at end of period $ 30,983 $ 73,359
============= =============
Supplemental Disclosures:
Interest paid $ 275,803 $ 330,099
Income tax paid 16,723 13,191
Non Cash Items:
Preferred stock dividends accreted 37,023 36,138
Accounts payable exchanged for long-term debt and notes payable - 5,981
Common Stock returned and cancelled 1 -
</TABLE>
The accompanying notes are an integral part of this statement.
- 6 -
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1. Financial Statements
The accompanying unaudited consolidated financial statements include the
accounts of PML, Inc. and its wholly-owned subsidiary, PML Microbiologicals,
Inc. The Company produces and sells diagnostic microbiology products to
customers in the microbiology testing industry, principally hospital and
healthcare-related laboratories, throughout the United States and Canada. In
addition, the Company has developed a line of sterility testing products for the
pharmaceutical and biotechnology industries. This new product offering will be
expanded to include general microbiology media and Quality Control
microorganisms.
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and pursuant to the rules and regulations of the
Securities and Exchange Commission (the "Commission"). While these financial
statements reflect all necessary, normal and recurring adjustments in the
opinion of management required to present fairly, in all material respects, the
financial position, results of operations and cash flows of the Company and its
subsidiary at February 28, 1998, and for the periods then ended, they do not
include all information and notes required by generally accepted accounting
principles for complete financial statements. Further information is contained
in the annual financial statements of the Company and notes thereto, for the
year ended May 31, 1997, contained in the Company's Form 10-KSB, filed with the
Commission pursuant to the Securities Exchange Act of 1934. Operating results
for the nine month period ended February 28, 1998 are not necessarily indicative
of the results that may be expected for the full year.
Reclassifications - Certain reclassifications have been made to the fiscal
1997 financial statements to conform to the fiscal 1998 presentation. Such
reclassifications did not have any effect on the net income or stockholders'
equity reported in fiscal 1997.
Note 2. Net Earnings Per Share
During the quarter ended February 28, 1998 the Company adopted Statement of
Financial Accounting Standards No. 128, "Earnings Per Share" (SFAS 128). As
required by SFAS 128, the Company has applied the provisions of SFAS 128 to the
current and all prior periods shown for purposes of computing earnings per share
(EPS). Potential conversion of Class A Convertible Preferred Shares into 242,351
and 224,704 common shares in 1997 and 1996, respectively, has not been assumed
in the diluted EPS calculation as the effect would have been anti-dilutive for
all periods presented.
- 7 -
<PAGE>
<TABLE>
<CAPTION>
Information Needed to Calculate Basic Earnings Per Share
For The Three Months Ended For The Nine Months Ended
February 28, February 28,
1998 1997 1998 1997
-------------------------- --------------------------
<S> <C> <C> <C> <C>
Numerator
- ---------
Net income $ 24,043 $ 100,373 $ 53,650 $ 219,690
Preferred stock dividends accreted (12,476) (12,006) (37,023) (36,138)
----------- ----------- ----------- -----------
Net income after accretion of dividends $ 11,567 $ 88,367 $ 16,627 $ 183,552
=========== =========== =========== ===========
Denominator
- -----------
Average number of common shares outstanding 1,780,441 1,776,816 1,778,277 1,776,816
Average number of Class B common stock outstanding 211,551 211,551 211,551 211,551
----------- ----------- ----------- -----------
Average shares used in basic EPS calculation 1,991,992 1,988,367 1,989,828 1,988,367
=========== =========== =========== ===========
Information Needed to Calculate Basic Earnings Per Share
For The Three Months Ended For The Nine Months Ended
February 28, February 28,
1998 1997 1998 1997
-------------------------- --------------------------
Numerator
- ---------
Net income $ 24,043 $ 100,373 $ 53,650 $ 219,690
Preferred stock dividends accreted (12,476) (12,006) (37,023) (36,138)
----------- ----------- ----------- -----------
Net income after accretion of dividends $ 11,567 $ 88,367 $ 16,627 $ 183,552
=========== =========== =========== ===========
Denominator
- -----------
Average number of common shares outstanding 1,780,441 1,776,816 1,778,277 1,776,816
Average number of Class B common stock outstanding 211,551 211,551 211,551 211,551
Effect of common stock equivalents 266,481 75,000 244,001 67,047
----------- ----------- ----------- -----------
Average shares used in diluted EPS calculation 2,258,473 2,063,367 2,233,829 2,055,414
=========== =========== =========== ===========
</TABLE>
- 8 -
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Forward Looking Statements
Management's Discussion and Analysis of Financial Condition and Results of
Operations contains certain forward looking statements that involve a number of
risks and uncertainties. For example, the Company has stated its belief that
sales of industrial products should continue to increase in the current year and
that reductions in cost of goods sold should continue from the consolidation of
three Oregon facilities into one new modern building. Future demand for the
Company's products, including its industrial products, is inherently subject to
supply and demand conditions, and to the unpredictable decisions of other market
participants. There can be no assurance that sales will increase generally or
within any specified product line or that the Company's margins will stabilize
or improve. Other elements that could cause results to differ materially include
competitive pressures and factors listed from time to time in the Company's
reports to the Securities and Exchange Commission, including, but not limited
to, this report on Form 10-QSB.
Year 2000 Issue
The Company recognizes the need to ensure that its operations will not be
adversely impacted by Year 2000 software failures. The Company is addressing
this issue to ensure the availability and integrity of its financial systems as
well as the reliability of its operational systems. The Company has nearly
completed installation of a complete new MIS system that the vendor represents
to be fully Year 2000 compliant and will continue to make certain investments in
its software systems and applications to ensure the Company is Year 2000
compliant. The financial impact (outside of previously planned systems
improvements) has not been and is not anticipated to be material.
Results of Operations
Nine Months Ended February 28, 1998 Compared to February 28, 1997
Net sales for the nine months ended February 28, 1998 increased
approximately 5.4% to $10,437,597 from $9,907,332 during the same period a year
ago. The increase in sales was due to across the board increases in the
industrial microbiology market and the clinical market, and from increased sales
of speciality products. The sales increase would have been 6.8% higher than last
year but was unfavorably reduced about $140,000 by a 2.3% reduction in the
average Canadian dollar exchange rate which impacts over 41% of total Company
sales. The Company's management is very encouraged with the favorable trend
showing that the net sales erosion of the past few years has been reversed.
During the nine months ended February 28, 1998 as compared to the same
period in the prior year, cost of goods sold (COGS) increased nearly $300,000
and selling, general, and administrative (SG&A) expenses also increased almost
$300,000. These increases were due primarily to the significant expense that the
Company incurred through internal investing in several areas which are expected
to improve its long term growth and profitability. These investments which
impact both COGS and SG&A expenses include expenditures to implement new MIS
software later this year, larger than normal expenses for the development of
five new product lines, start-up costs to consolidate three Oregon facilities
into one modern Oregon facility in June 1997, launch costs for a number of new
OEM and distributor relationships, the successful defense of a lawsuit filed by
a former employee, accrued costs for the planned closure of a small Canadian
manufacturing facility, launch costs for a complete marketing literature
campaign, and start-up costs for a new Inside Sales program.
Gross profit improved to 38.8% of net sales in the nine months ended
February 28, 1998 compared to 38.5% in the prior year. This improvement results
from decreased sales of lower margin commodity-type products, increased sales of
higher margin specialty products, new Distributor relationships, and improved
operating efficiencies resulting from the June 1997 consolidation of three
Oregon locations into a single modern nearly 45,000 square foot building in
Wilsonville, Oregon. Management believes that there have been no other changes
in its sales or operations that would materially affect gross profit. The
Company continues to experience pricing
- 9 -
<PAGE>
pressure resulting from competition and from other cost containment measures in
the health care industry, but it has been working to adjust its product mix and
marketing focus towards less competitive, higher profit, products and markets.
Selling, general and administrative expense was 35.3% of sales for the nine
months ended February 28, 1998 compared to 34.1% in the same period a year ago.
While a 0.7% reduction was achieved in payroll expense, it was offset by a 1.6%
increase in marketing expenditures to aggressively promote PML products, open
new distribution channels, implement a new Year 2000 compliant MIS system, a
$35,000 legal expenditure to successfully defend a lawsuit brought by a former
employee and expenses to launch a new Inside Sales department. Total other
expense increased to 2.6% of sales in the first nine months of this year
compared to 2.1% in the first nine months of last year. Other expense consists
mainly of interest expense and Canadian currency exchange gain or loss. Exchange
gains or losses cannot be forecasted with any degree of accuracy but have
generated a $39,000 loss this year compared to a $3,000 loss last year for the
same period.
The Company recorded net income of $53,650 for the first nine months
compared to net income of $219,690 during the same period a year ago. On a
pre-tax basis the Company recorded income of $99,175 for the first nine months
of this year compared to $229,018 for the same period a year ago. The smaller
difference between net income and pre-tax income last year compared to this year
reflects the recognition of benefit from a partially reserved deferred tax asset
last year which eliminated the need to book any federal income tax liability.
Since the benefit from the deferred tax asset has been fully recognized, the
estimated Federal, State, Canadian and Provincial tax provisions more closely
reflect the current statutory tax rates.. The net income was $0.01 per diluted
share for the first nine months ended February 28, 1998 compared to net income
of $0.09 per diluted share during the same period a year ago. As stated earlier,
the Company's reduced profitability in the first nine months of this fiscal year
reflects the start up expenses associated with the new Wilsonville manufacturing
and corporate headquarters location, larger exchange, loss legal expenses, and a
heavy investment in marketing programs which more than offset the significant
improvements that have been made in reducing normal manufacturing costs and
operating costs.
Liquidity and Capital Resources
The Company has financed its operations over the years principally through
funds generated from operations and bank and stockholder loans. At February 28,
1998 the Company had negative working capital of $2,845 compared with positive
working capital of $99,213 at May 31, 1997. The ratio of current assets to
current liabilities decreased to 1.00 at February 28, 1998 compared to 1.03 at
May 31, 1997. Quick liquidity (current assets less inventories to current
liabilities) was .58 at February 28, 1998 and .62 at May 31, 1997. This decline
reflects increased borrowings to finance capital purchases.
The twelve-month average collection period for trade receivables was 51.5
days at February 28, 1998, compared with 49.4 days at May 31, 1997. This slight
increase reflects both seasonality and some slow down in payments from east
coast clinical customers.
Net cash used by operating activities was $476,519 in the first nine months
of fiscal 1998 compared with net cash provided of $192,480 in the same period a
year ago. Approximately $343,797 of the cash used in fiscal 1998 was for the
planned increase of inventories to support the higher level of sales. Another
$356,465 of the cash used was for the increase in accounts receivable also
mainly due to increased sales levels. These two uses were partially offset by
$261,442 of adjustments for depreciation and amortization. The Company
anticipates that the need to increase inventory and accounts receivable will
diminish over the next few years thereby reducing negative operating cash flow
and improving the Company's ability to repay debt. In fiscal 1997, nearly the
entire operating cash was provided from net income before depreciation and
amortization. Net cash used in investing activities was $321,980 in the first
nine months of fiscal 1998, compared with $154,272 used by the Company in
investing activities in the same period of 1997. These expenditures were mainly
for purchases of property, plant and equipment for the new manufacturing
facility in Wilsonville and expenditures for an integrated MIS reporting system
that is scheduled to be in place later this year. Financing activities provided
cash of $755,072 in the first nine months of fiscal 1998 as the net result of
draws on the bank credit line and repayments on notes payable and the bank
credit line. This compares to cash provided of $25,264 from financing activities
in the same period of fiscal 1997.
- 10 -
<PAGE>
As a result of the Company's unused net operating loss from prior years,
the Company will not have to pay any significant income tax amounts for several
years.
Due to a September 16, 1996 increase in the interest rate charged by our
former lender, the Company negotiated a larger and more favorable four year
financing agreement with another lender effective December 1, 1996. The new
financing agreement includes interest at prime plus 2.0% (10.5% at February 28,
1998) (which will decrease each year if certain financial ratios are met) and
also allows the Company to borrow against both equipment and inventory as well
as accounts receivable. Proceeds from the new financing agreement were used to
pay off all outstanding debt from the prior lender and will provide additional
funds for growth. The Company believes the improvement in available cash
financing will allow it to achieve significant manufacturing cost efficiencies
and much needed improvements in MIS systems which were not possible under its
previous loan agreement. Management expects any investments made in these areas
will payback in one to two years.
As part of the financing agreement, the Company obtained a new bank line of
credit that has a current maturity date of November 30, 2000. Although the due
date for the facility is November 30, 2000, the borrowings are classified as
current as the Company initiates repayments and borrowings on a regular (near
daily) basis throughout the year This new line of credit is secured by
substantially all of the assets of the Company. The available amount under the
line of credit is based upon 80% to 85% of the eligible accounts receivable and
30% to 40% of eligible inventory at the end of each reporting period, not to
exceed $2.5 million. The Company also borrowed $400,000 on December 1, 1996,
under a new four year term loan secured by eligible operating equipment. The
rate of interest charged on the line is prime plus 2.0% and will decrease each
year if the Company meets certain financial ratios. This loan will be repaid
primarily out of the Company's future receivable collections.
The Company's borrowing structure at February 28, 1998 was as follows:
<TABLE>
<CAPTION>
Third Party Long Term Borrowings:
Long-Term Current-Portion
------------ ---------------
<S> <C> <C>
Revolving credit line at prime plus 2.0% (10.5% at February 28,
1998) due November 30, 2000 $ - $ 2,008,129
Note payable at 12%, due April 2000 70,797 15,529
Note payable at prime plus 2.0% (10.5% at February 28, 1998)
due November 30, 2000 183,316 100,008
Capital Lease Obligations, due now through July 1999 132,754 105,270
Note payable at 6%, due May 2005 70,000 10,000
Trade A/P converted to notes payable at 6%, due February 2001 394,693 70,916
------------ ------------
Total third party long term borrowings $ 851,560 $ 2,309,852
------------ ------------
Related Party Long Term Borrowings:
Ethel Wildt Note payable at prime plus 1% (9.5% at February 28,
1998) due November 1998 $ - $ 9,462
Ron Torland Note payable at 10% due January 1998 - 10,000
Ron Torland Note payable at prime plus 1% (9.5% at February 28,
1998) due December 1999 35,821 11,679
Mary Brown 8% Note due May 2000 35,807 23,923
Trade A/P converted to notes payable at 6% due February 2001 63,945 11,577
------------ ------------
Total related party long term borrowings $ 135,573 $ 66,641
------------ ------------
- 11 -
<PAGE>
Related Party Notes Payable:
Demand Notes $ - $ 247,551
------------ ------------
Total long term borrowings and notes payable $ 987,133 $ 2,624,044
============ ============
</TABLE>
II. OTHER INFORMATION
Item 1. Legal Proceedings
There are no material or substantive claims pending or threatened against
the Company.
Item 4. Submission of Matters to a Vote of Security Holders
There were no matters submitted to a vote of security holders during the
quarter ended February 28, 1998.
Item 6. Exhibits and Reports on Form 8-K
No 8-K filings were made during the quarter ended February 28, 1998.
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.
PML, INC.
(Registrant)
Date: April 13, 1998 By: /s/ Kenneth L. Minton
----------------------- ---------------------
Kenneth L. Minton
President and Chief Executive Officer
- 12 -
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAY-31-1997
<PERIOD-END> FEB-28-1998
<CASH> 30,983
<SECURITIES> 0
<RECEIVABLES> 2,201,527
<ALLOWANCES> 71,616
<INVENTORY> 1,803,861
<CURRENT-ASSETS> 4,275,161
<PP&E> 4,482,790
<DEPRECIATION> 2,674,121
<TOTAL-ASSETS> 6,230,472
<CURRENT-LIABILITIES> 4,278,006
<BONDS> 987,133
0
678,584
<COMMON> 19,920
<OTHER-SE> 266,829
<TOTAL-LIABILITY-AND-EQUITY> 6,230,472
<SALES> 10,437,597
<TOTAL-REVENUES> 10,437,597
<CGS> 6,385,122
<TOTAL-COSTS> 6,385,122
<OTHER-EXPENSES> 3,680,866
<LOSS-PROVISION> 19,317
<INTEREST-EXPENSE> 253,117
<INCOME-PRETAX> 99,175
<INCOME-TAX> 45,525
<INCOME-CONTINUING> 53,650
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 53,650
<EPS-PRIMARY> 0.01
<EPS-DILUTED> 0.01
</TABLE>
