SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15 (d)of the Securities Exchange
Act of 1934
For Quarter Ended March 31, 1995 Commission File Number 0-6611
SIMPSON INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Michigan 38-1225111
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
47603 Halyard Drive, Plymouth, MI 48170
(Address of principal executive offices) (Zip Code)
(313) 207-6200
(Registrant's telephone number, including area code)
32100 Telegraph Road, Bingham Farms, Michigan 48025
(Former name, former address and former fiscal year, if changed since
last report.)
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 and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
At April 30, 1995 there were 17,981,261 outstanding shares of the
registrant's common stock, $1.00 par value each.
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Financial Statements
Simpson Industries, Inc.
Consolidated Balance Sheets (Unaudited)
(In thousands)
March 31, 1995 and December 31, 1994
31-Mar 31-Dec
ASSETS
Current Assets
Cash and cash equivalents $30,555 $4,812
Accounts receivable 48,968 48,203
Inventories 11,351 11,221
Customer tooling in process 898 1,057
Prepaid expenses and
other current assets 4,824 5,245
Total Current Assets 96,596 70,538
Property, Plant and Equipment
Cost 232,938 228,880
Less allowances 97,224 93,847
135,714 135,033
Other Assets 5,966 1,413
$238,276 $206,984
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Current installment
of long-term debt $2,125 $2,125
Accounts payable 22,298 20,679
Compensation and
amounts withheld 6,962 8,980
Taxes, other than
income taxes 3,356 2,492
Other accrued expenses 7,648 4,611
Total Current Liabilities 42,389 38,887
Long-Term Debt, excluding
current installment 74,425 50,375
Accrued Retirement Benefits 10,740 10,414
Deferred Income Taxes 9,360 9,269
Shareholders' Equity 101,362 98,039
$238,276 $206,984
Simpson Industries, Inc.
Consolidated Statements of Operations (Unaudited)
(Dollars in thousands, except per share amounts)
Periods Ended March 31, 1995 and 1994
Three Months
1995 1994
Net Sales $107,237 $82,701
Costs and Expenses:
Cost of products sold 94,856 73,155
Administrative and selling 2,409 2,086
97,265 75,241
Operating Earnings 9,972 7,460
Investment and other income, net 334 296
Interest expense (1,381) (1,221)
Earnings Before Income Taxes 8,925 6,535
Income taxes 3,363 2,451
Net Earnings $5,562 $4,084
Net Earnings Per Share - Note 2 $0.31 $0.23
Cash dividends per share - Note 2 $0.10 $0.09
Average number of common and
common equivalent shares
- Note 2 18,005,567 17,990,140
Simpson Industries, Inc.
Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
Three Months Ended March 31, 1995 and 1994
1995 1994
OPERATING ACTIVITIES
Net earnings $5,562 $4,084
Depreciation 4,497 3,791
Provision for deferred
income taxes 91 58
Amortization of
restricted stock 87 66
(Gain) loss on disposition
of assets (87) 4
Changes in operating assets
and liabilities (1,040) (6,240)
Cash Provided By Operating
Activities 9,110 1,763
INVESTING ACTIVITIES
Capital expenditures (5,316) (10,241)
Proceeds from disposal of
property and equipment 225 286
Cash Used In Investing
Activities (5,091) (9,955)
FINANCING ACTIVITIES
Cash dividends paid (1,797) (1,672)
Proceeds from long-term
borrowings 24,050 5,000
Cash provided by stock
transactions, net 0 31
Cash Provided By Financing
Activities 22,253 3,359
Effect of foreign currency
exchange rate changes (529) (495)
Increase (Decrease) In Cash
and Cash Equivalent 25,743 (5,328)
Cash and cash equivalents at
beginning of period 4,812 15,493
Cash and Cash Equivalents
At End Of Period $30,555 $10,165
Simpson Industries, Inc.
Notes to Condensed Consolidated Financial Statements
Note 1. The accompanying unaudited consolidated financial statements
have been prepared in accordance with generally accepted accounting
principals for interim financial reporting. In the opinion of
management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. The
results of operations for the period ended March 31, 1995 are not
necessarily indicative of the results to be expected for the year
ending December 31, 1995.
Note 2. The computation of earnings per share, dividends per share and
average number of common share outstanding for the three months ending
March 31, 1994, have been restated to reflect a 3-for-2 stock
distribution as of July 28, 1994.
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Net sales increased 29.7%, or $24,536,000, from the first three months
of 1994. The increased sales for the quarter, compared to the first
period last year, resulted from an increase in North American
production of automobiles and light trucks and from new product
programs put into production during the past 18 months. North American
auto and light truck production increased 4% year-over-year.
Additionally, volume increased significantly in the heavy duty
business, primarily with Caterpillar and Consolidated Diesel Corp. The
Company believes that its sales will continue to increase, at a
moderate rate, on a quarterly year-over-year basis.
Cost of products sold as a percent of sales for the first three months
of 1995, compared to the first period of 1994 remained the same at
88.5%.
Administrative and selling costs as a percent of sales decreased for
the three month period ended March 31, 1995, compared to the first
quarter of 1994 due to higher sales volume and cost control. Interest
expense increased from 1994 as a result of increased long-term debt.
In January 1995, the Company entered into bank term loan agreements for
$20,000,000 and $4,050,000. The Company borrowed the $20,000,000 at an
interest rate of 8.45%, payable quarterly, with repayment of principal
due in twenty quarterly installments commencing in July 2000.
Additionally, the Company's Mexican subsidiary borrowed $4,050,000 at
an interest rate of 8.82%, payable monthly, with repayment of principal
due in eighty-four equal monthly installments commencing in February
1996.
The Company invests in equipment and facilities to produce components
for automotive, truck and engine programs. Cash flows from operations
and proceeds from long-term borrowings, discussed above, exceeded these
investments and dividends paid, resulting in a $25,743,000 increase in
cash and cash equivalents. With a quick ratio of 1.9 to 1, and a total
debt to invested capital ratio of 43%, the Company's financial
condition remains strong.
Part II. Other Information
Item 4: Submission of matters to a vote of security holders
The annual meeting of shareholders of Simpson Industries, Inc. was held
on April 25, 1995 in Troy, Michigan. The following persons were
elected to serve on the Board of Directors until the 1998 annual
meeting.
Votes in
Nominee Favor Withheld
Michael E. Batten 11,473,687 469,879
Robert W. Navarre 11,518,108 425,458
Frank K. Zinn 11,541,069 402,497
Part II. Other Information
Item 6: Exhibits and Reports on Form 8-K
There were no reports filed on Form 8-K for the quarter ended March 31,
1995.
Simpson Industries, Inc.
Computation of Earnings Per Share
Three Months Ended
31-Mar
1995 1994
Primary
Average number of common
shares outstanding
- Note 2 17,943,665 17,889,493
Dilutive stock options
outstanding - Note 2 61,902 100,647
Average number of common and
common equivalent shares 18,005,567 17,990,140
Net earnings applicable to
common stock and common
stock equivalents $5,562,000 $4,084,000
Primary earnings per share $0.31 $0.23
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.
SIMPSON INDUSTRIES, INC.
Registrant
Date: May 10, 1995 /s/ Roy E. Parrott
Roy E. Parrott
President & Chief Executive Officer
Date: May 10, 1995 /s/James E. Garpow
James E. Garpow
Controller
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE COMPANY'S UNAUDITED FINANCIAL
STATEMENTS AS OF AND FOR THE PERIOD ENDING MARCH 31,
1995, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS
<MULTIPLIER> 1,000
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<PERIOD-TYPE> 3-MOS
<CASH> 30,555
<SECURITIES> 0
<RECEIVABLES> 48,968
<ALLOWANCES> 0
<INVENTORY> 11,351
<CURRENT-ASSETS> 96,596
<PP&E> 232,938
<DEPRECIATION> 97,224
<TOTAL-ASSETS> 238,276
<CURRENT-LIABILITIES> 42,389
<BONDS> 74,425
0
0
<COMMON> 17,977
<OTHER-SE> 83,385
<TOTAL-LIABILITY-AND-EQUITY> 238,276
<SALES> 107,237
<TOTAL-REVENUES> 107,571
<CGS> 94,856
<TOTAL-COSTS> 2,409
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,381
<INCOME-PRETAX> 8,925
<INCOME-TAX> 3,363
<INCOME-CONTINUING> 5,562
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,562
<EPS-PRIMARY> 0.31
<EPS-DILUTED> 0.31
</TABLE>
