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 1997 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 IRS Employer Identification No.)
incorporation or organization)
47603 Halyard Drive, Plymouth, Michigan 48170-2429
(Address of principal executive offices) (Zip Code)
(313)207-6200
(Registrant's telephone number, including area code)
(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, 1997 there were 18,098,748 outstanding shares of the registrant's
common stock, $1.00 par value each.
PAGE
<PAGE>
Consolidated Balance Sheets (Unaudited)
(In thousands)
March 31, 1997 and December 31, 1996
Mar. 31 Dec. 31
ASSETS
Current Assets
Cash and cash equivalents $ 21,120 $ 28,902
Accounts receivable 47,078 41,032
Inventories 13,187 14,034
Customer tooling in process 4,823 4,002
Prepaid expenses and other current assets 5,467 6,256
Total Current Assets 91,675 94,226
Property, Plant and Equipment
Cost 282,966 278,229
Less Allowance 130,560 126,152
152,406 152,077
Other Assets 1,933 2,653
$246,014 $248,956
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Current installment of long-term debt $ 3,579 $ 3,579
Accounts payable 23,050 28,455
Compensation and amounts withheld 6,788 10,203
Taxes, other than income taxes 3,251 2,597
Other accrued expenses 6,491 4,354
Total Current Liabilities 43,159 49,188
Long-Term Debt, excluding current installment 58,498 58,643
Accrued Retirement Benefits 14,398 14,015
Deferred Income Taxes 11,415 11,118
Shareholders' Equity 118,544 115,992
$246,014 $248,956
<PAGE>
Consolidated Statement of Operations (Unaudited)
(dollars in thousands, except per share amounts)
Periods Ended March 31, 1997 and 1996
Three Months
1997 1996
Net sales $105,874 $101,421
Costs and expenses:
Cost of products sold 95,058 91,038
Administrative and selling 3,032 2,835
98,090 93,873
Operating Earnings 7,784 7,548
Investment and other income, net 419 124
Interest expense (1,293) (1,340)
Earnings Before Income Taxes 6,910 6,332
Income taxes 2,523 2,375
Net Earnings $ 4,387 $ 3,957
Net Earnings Per Share $.24 $.22
Cash dividends per share $.10 $.10
Average number of common
equivalent shares 18,149,436 18,073,716
Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
Three Months Ended March 31, 1997 and 1996
1997 1996
OPERATING ACTIVITIES
Net Earnings $ 4,387 $ 3,957
Depreciation 5,314 5,053
Provision for deferred income taxes 297 302
Amortization of restricted stock 82 73
(Gain) loss on disposition of assets (86) 24
Changes in operating assets and liabilities (9,120) (4,719)
Cash Provided By Operating Activities 874 4,690
INVESTING ACTIVITIES
Capital expenditures (6,703) (5,843)
Proceeds from disposal of property and equipment 109 24
Cash Used In Investing Activities (6,594) (5,819)
FINANCING ACTIVITIES
Cash dividends paid (1,813) (1,808)
Principal repayment of long-term borrowings (145) (144)
Cash provided by stock transactions, net 0 242
Cash Provided From (Used In) Financing Activities (1,958) (1,710)
Effect of foreign currency exchange rate changes (104) 151
Increase (Decrease)In Cash and Cash Equivalents (7,782) (2,688)
Cash and cash equivalents at beginning of period 28,902 13,490
Cash and Cash Equivalents At End of Period $21,120 $10,802
<PAGE>
Note to Condensed Consolidated Financial Statements
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles 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, 1997 are not necessarily indicative of the results to be
expected for the year ending December 31, 1997.
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Net sales increased for the first quarter of 1997 by 4.4%, or $4,453,000, from
the first quarter of 1996. The sales increase in the current year was
primarily attributable to last years work stoppage at General Motors which
negatively impacted sales for the first quarter by approximately $3 million.
Also contributing to first quarter results was the 6% increase in the North
American production volumes for autos and light trucks from the first quarter
of 1996.
Cost of products sold as a percent of sales for the first three months of
1997, compared to the same period of 1996, remained the same at 89.8%.
Administrative and selling costs remained at approximately 2.8% of sales for
the first quarters of 1997 and 1996. Interest expense decreased slightly for
the first quarter of 1997 due to lower average debt balances.
Cash flow from operations was $874,000 for the first quarter. The Company's
investment in production capacity for new automotive, light truck and diesel
engine programs was $6,703,000. These investments, when added to dividends
paid during the three months ended March 31, 1997, exceeded the cash flow from
operations, resulting in a reduction of $7,782,000 in cash and cash
equivalents. With a quick ratio of 1.6 to 1 and total debt to invested
capital of 34.4%, 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 22, 1997 in Plymouth, Michigan. The following persons
were nominated on the Board of Directors until the 2000 annual
meeting.
Votes In
Nominee Favor Withheld
Susan F. Haka 15,583,811 208,583
Walter J. Kirchberger 15,763,423 128,971
Roy E. Parrott 15,735,526 156,868
The amendment to restate the Articles of Incorporation of the
Company to increase the number of authorized shares of common
stock from 35,000,000 to 55,000,000 was passed. The following
votes were cast:
Votes in favor 14,452,715
Votes against 1,340,611
Abstentions 99,066
Broker non-votes 2
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 11 - Computation of Earnings Per Share
Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter ended March 31, 1997.
<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.
SIMPSON INDUSTRIES, INC.
Registrant
May 7, 1997 /s/Roy E. Parrott
Roy E. Parrott
President and Chief Executive Officer
Three Months Ended
Mar. 31
1997 1996
Primary
Average number of
common shares
outstanding 18,100,954 18,035,828
Dilutive stock
options outstand-
ing 48,482 37,888
Average number of
common and common
equivalent shares 18,149,436 18,073,716
Net earnings appli-
cable to common
stock and common
stock equivalents $4,387,000 $ 3,957,000
Primary earnings
per share $.24 $.22
<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,
1997, AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS
<MULTIPLIER> 1,000
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<PERIOD-TYPE> 3-MOS
<CASH> 21,120
<SECURITIES> 0
<RECEIVABLES> 47,078
<ALLOWANCES> 0
<INVENTORY> 13,187
<CURRENT-ASSETS> 91,675
<PP&E> 282,966
<DEPRECIATION> 130,560
<TOTAL-ASSETS> 246,014
<CURRENT-LIABILITIES> 43,159
<BONDS> 0
<COMMON> 18,133
0
0
<OTHER-SE> 100,411
<TOTAL-LIABILITY-AND-EQUITY> 246,014
<SALES> 105,874
<TOTAL-REVENUES> 106,293
<CGS> 95,058
<TOTAL-COSTS> 3,032
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,293
<INCOME-PRETAX> 6,910
<INCOME-TAX> 2,523
<INCOME-CONTINUING> 4,387
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,387
<EPS-PRIMARY> 0.24
<EPS-DILUTED> 0.24
</TABLE>
