<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED OCTOBER 26, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number 0-21838
INDUSTRIAL SCIENTIFIC CORPORATION
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 25-1481281
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1001 Oakdale Road, Oakdale, PA 15071
(Address of principal executive offices)
412-788-4353
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Title of each class - Common Stock, par value $.01
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 (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 December 5, 1996, there were 3,370,587 shares of Common Stock, par value
$.01 per share of the Registrant's common stock outstanding.
<PAGE>
INDUSTRIAL SCIENTIFIC CORPORATION AND SUBSIDIARIES
INDEX
-----
Page No.
--------
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
Condensed Consolidated Balance Sheet -
October 26, 1996 and January 27, 1996. 3
Condensed Consolidated Statement of Income -
Three and nine months ended October 26, 1996 and
October 28, 1995. 4
Condensed Consolidated Statement of Cash Flows -
Three and nine months ended October 26, 1996 and
October 28, 1995. 5
Notes to Condensed Consolidated Financial Statements. 6
Item 2. Management's Discussion and Analysis of Results
of Operations and Financial Condition. 8
Part II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K. 11
2
<PAGE>
PART 1. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
INDUSTRIAL SCIENTIFIC CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(in thousands, except share data)
<TABLE>
<CAPTION>
October 26, January 27,
1996 1996
----------- -----------
(Unaudited) **
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $5,328 $7,485
Short-term investments 8,304 7,816
----------- -----------
13,632 15,301
Accounts receivable, net 4,412 4,395
Inventories 3,736 3,504
Prepaid expenses and other assets 382 311
Deferred income taxes 324 252
----------- -----------
Total current assets 22,486 23,763
Long-term investments 5,388 929
Property, plant, and equipment, at cost 13,302 12,943
Less accumulated depreciation and amortization 5,884 4,745
----------- -----------
7,418 8,198
Land 390 390
Intangible assets, net 2,460 2,199
----------- -----------
Total assets $38,142 $35,479
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $1,265 $1,260
Accrued payroll and related items 1,045 711
Accrued warranty expenses 416 299
Income taxes payable 169 304
Current portion of term debt 354 613
----------- -----------
Total current liabilities 3,249 3,187
Term debt 4,185 4,512
Deferred income taxes 158 209
----------- -----------
Total liabilities 7,592 7,908
Shareholders' equity:
Preferred stock, without par value; authorized
1,000,000 shares; none issued ---- ----
Common stock, $.01 par value; authorized 15,000,000
shares; issued and outstanding 3,375,087 shares
at 10/26/96 and at 1/27/96 34 34
Additional paid-in capital 5,471 5,471
Retained earnings 25,045 22,066
----------- -----------
Total shareholders' equity 30,550 27,571
----------- -----------
Total liabilities and shareholders' equity $38,142 $35,479
=========== ===========
</TABLE>
** - Summarized from audited January 27, 1996 balance sheet.
The accompanying notes are an integral part of the condensed consolidated
financial statements.
3
<PAGE>
INDUSTRIAL SCIENTIFIC CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(Unaudited, in thousands except share data)
<TABLE>
<CAPTION>
For the three months ended For the nine months ended
October 26, October 28, October 26, October 28,
1996 1995 1996 1995
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Net sales $8,656 $8,625 $27,089 $25,688
Cost of goods sold 3,770 3,995 12,368 12,003
---------- ---------- ---------- ----------
Gross profit 4,886 4,630 14,721 13,685
Operating expenses:
Selling 1,727 1,711 5,479 4,905
Research, development and
engineering 883 823 2,768 2,120
Administrative 752 842 2,321 2,535
---------- ---------- ---------- ----------
Total operating expenses 3,362 3,376 10,568 9,560
---------- ---------- ---------- ----------
Operating profit 1,524 1,254 4,153 4,125
Interest income 199 203 588 624
Interest expense (44) (65) (145) (196)
Other (expenses)/income (10) ----- (27) 4
---------- ---------- ---------- ----------
Income before income taxes 1,669 1,392 4,569 4,557
Provision for income taxes 605 446 1,590 1,560
---------- ---------- ---------- ----------
Net income $1,064 $946 $2,979 $2,997
========== ========== ========== ==========
Net income per common share $0.31 $0.28 $0.88 $0.89
========== ========== ========== ==========
Weighted average number of
common and common
equivalent shares outstanding 3,375,000 3,389,000 3,377,000 3,392,000
========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of the condensed consolidated
financial statements.
4
<PAGE>
INDUSTRIAL SCIENTIFIC CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited, in thousands)
<TABLE>
<CAPTION>
For the nine months ended
October 26, October 28,
1996 1995
---------- ----------
<S> <C> <C>
Cash flows from operating activities:
Net income $2,979 $2,997
Depreciation, amortization and other
non-cash items 1,196 1,083
Changes in operating assets and liabilities (77) (1,354)
---------- ----------
Net cash provided by operating activities 4,098 2,726
Cash flows from investing activities:
Purchase of short-term investments (7,820) (13,449)
Purchase of long-term investments (5,765) (447)
Acquisition of Monitor Group ----- (2,500)
Proceeds from maturities of short-term investments 8,838 12,198
Capital expenditures (669) (842)
Investment in joint venture (267) -----
---------- ----------
Net cash used in investing activities (5,683) (5,040)
Cash flows from financing activities:
Principal payments on debt (572) (730)
---------- ----------
Net cash used in financing activities (572) (730)
Net decrease in cash and cash equivalents (2,157) (3,044)
Cash and cash equivalents at beginning of period 7,485 8,118
---------- ----------
Cash and cash equivalents at end of period $5,328 $5,074
========== ==========
The accompanying notes are an integral part of the condensed consolidated
financial statements.
</TABLE>
5
<PAGE>
INDUSTRIAL SCIENTIFIC CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(1) Management's Discussion and Analysis of Results of Operations and Financial
Condition which follows these notes contains additional information on the
results of operations and the financial position of the Company. These
comments should be read in conjunction with the notes.
(2) In the opinion of management, all adjustments, (consisting only of normal
and recurring adjustments), necessary for a fair presentation of the
results of the operations of these interim periods have been included.
(3) The Company's investments are in investment grade debt securities that it
has the positive intent and ability to hold to maturity and are carried at
amortized cost. These investments in debt securities exceeded market value
by approximately $43,000 and $32,000 at October 26, 1996 and January 27,
1996, respectively.
(4) Inventories consisted of:
<TABLE>
<CAPTION>
October 26, January 27,
1996 1996
(in thousands)
<S> <C> <C>
---------- ----------
At standard costs, which approximate
first-in, first-out cost:
Raw materials $2,839 $2,952
Work in process 588 367
Finished goods 439 315
------ ------
3,866 3,634
Less LIFO reserves 130 130
------ ------
Inventories at LIFO value $3,736 $3,504
====== ======
</TABLE>
continued
6
<PAGE>
(5) The effective tax rate of 34.8% for the nine months ended October 26, 1996
is based upon an estimate of the effective rate for the year ended January
25, 1997. The principal difference between the effective tax rate and the
federal statutory rate is the effect of foreign sales corporation benefits,
research and experimentation credits, and non-taxable interest benefits,
offset by the effect of state and local income taxes.
(6) Effective January 28, 1996, the Company adopted Statement of Financial
Accounting Standard (SFAS) No. 121 "Accounting for the Impairment of Long-
Lived Assets and Long-Lived Assets to Be Disposed Of" which had no material
effect on the Company's financial statements.
7
<PAGE>
1. FINANCIAL INFORMATION
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
The following discussion should be read in conjunction with the attached
unaudited condensed consolidated financial statements and notes thereto for the
three month and nine month periods ended October 26, 1996 and October 28, 1995
and with the Company's audited financial statements and notes thereto for the
fiscal year ended January 27, 1996.
Results of Operations
Quarter ended October 26, 1996 Compared to Quarter Ended October 28, 1995
Net Sales for the quarter ended October 26, 1996 ("third quarter 1996") were
$8.7 million essentially even with net sales of $8.6 million for the quarter
ended October 28, 1995 ("third quarter 1995"). A slight decline in sales in
North America was offset by increased international sales resulting from the
Company's continuing efforts to establish a worldwide sales and service network.
Gross profit increased $256,000 or 5.5% to $4.9 million for the third quarter
1996 compared to $4.6 million for the third quarter 1995. As a percent of net
sales, gross profit increased to 56.4% for the 1996 quarter compared to 53.7%
for the third quarter 1995. This increase in gross profit as a percent of net
sales resulted from increased sales of replacement parts which generate a higher
margin than new instruments, and increased margin on repair services resulting
from better efficiency relating to higher volume.
Operating expenses totaled $3.4 million for the third quarter 1996, basically
even with operating expenses of $3.4 million for the third quarter 1995.
Selling expense increased $16,000 as increased costs incurred to establish an
international presence were offset by reduced commission and advertising
expense. Research, development and engineering costs increased $135,000 or
18.0% resulting principally from increased costs incurred in the continuing
commercial development of the MG2100 portable mass spectrometer. Administrative
expenses declined $165,000 or 18.0% primarily due to a reduction in the
provision for profit sharing.
Interest income was basically unchanged at $199,000 for the third quarter 1996
compared to $203,000 for the third quarter 1995. Interest expense declined due
8
<PAGE>
to lower outstanding debt because of principal repayments during the
intervening periods.
The effective tax rate for the third quarter 1996 was 36.2% compared to 32.0%
for the third quarter 1995. A reduction in the research and experimentation
credit, and increased state income taxes accounts for this increase.
Net Income for the third quarter 1996 totaled $1.1 million or $0.31 per share,
an increase of 12.5% compared to net income of $946,000 or $0.28 per share for
the third quarter 1995.
Results of Operations
Nine Months Ended October 26, 1996 Compared to Nine Months Ended
October 28, 1995.
Net Sales for the nine months ended October 26, 1996 totaled $27.1 million , an
increase of $1.4 million or 5.5% compared to net sales of $25.7 million for the
nine months ended October 28, 1995. Increased international sales, principally
to the Middle East, due to the Company's ongoing market development efforts
outside North America account for this increase. Sales within North America
continue to be lower in 1996 than 1995 because of increased competition and
generally flat demand for the Company's products.
Gross profit increased to $14.7 million for the nine months ended October 26,
1996, an increase of 7.6% or $1.0 million compared to gross profit of $13.7
million for the nine months ended October 28, 1995. Gross profit as a percent
of net sales also increased to 54.3% for the 1996 period compared to 53.3% for
the 1995 period. Increased manufacturing efficiencies resulting from higher
sales volume and increased sales of replacement parts which typically generate
higher gross profit margins principally account for this increase.
Operating expenses totaled $10.6 million for the nine months ended October 26,
1996, and were $1.0 million or 10.5% higher than the $9.6 million operating
expenses incurred in the nine months ended October 28, 1995. Selling expenses
increased $574,000 to $5.5 million for the 1996 period compared to $4.9 million
for the 1995 period, an increase of 11.7%, resulting primarily from the
Company's continuing efforts to establish an international distribution and
service network. Research, development and engineering expense increased
$748,000 or 37.0 percent to $2.8 million for the nine months ended October 26,
1996 compared to $2.0 million for the comparable 1995 period. This increase is
primarily due to costs incurred in the continuing commercial development of the
MG2100 portable mass spectrometer. The Company completed the acquisition of the
assets of Monitor Group Inc. as of the end of June 1995, so that the nine months
ended October 26, 1996 include nine months of expenses relating to the MG2100
project while the October 1995 period only includes four months. Administrative
expenses declined $314,000 or 11.9% primarily due to a reduction in the
provision for profit sharing.
9
<PAGE>
Interest income declined slightly for the nine months ended October 26, 1996.
A greater portion of investments were in tax free instruments which yield a
higher after tax return but a generally lower coupon rate. Interest expense
declined due to lower outstanding debt balances because of continuing principal
payments.
The effective tax rate for the nine months ended October 26, 1996 was 34.8%
compared to 34.2% for the comparable 1995 period. A reduction in the research
and experimentation credit primarily accounts for this increase.
Net income year to date 1996 totaled $3.0 million or $0.88 per share, virtually
unchanged from $3.0 million or $0.89 per share for the comparable 1995 period.
Liquidity and Capital Resources
Cash flow from operations totaled $4.1 million for the nine month ended October
26, 1996, compared to $2.7 million for the prior year period. This positive
change is primarily due to reduced use of cash for operating assets and
increased depreciation and amortization in the 1996 period compared to the 1995
period.
Capital expenditures totaled $669,000 for the nine months ended October 26,
1996, which included the acquisition of the assets of McNeill International
Systems Division, production tooling related to new products, and computer
hardware and software to support the Company's growing operations. The Company
also invested $267,000 in Industrial Scientific Arabia Ltd. , a joint venture
with a Saudi Arabian partner.
During the first half 1995 the Company acquired the assets of Monitor Group
Inc., a developer of portable mass spectrometers for $2.5 million in cash.
Approximately $2.4 million of the purchase price related to identifiable
intangible assets and goodwill which are being amortized over their estimated
useful lives which range from three to seventeen years.
On November 14, 1996, the Company announced that the Board of Directors had
authorized the Company to repurchase up to 10% or 337,500 shares of its issued
and outstanding common stock from time to time in the open market and in
privately negotiated transactions
Working capital totaled $19.2 million as of October 26, 1996 compared to $20.6
million as of January 27, 1996. The Company believes that its cash flow and
capital structure provide adequate flexibility for the growth of its operations
and the funding of capital spending programs.
10
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Nothing to report under this item.
ITEM 2. CHANGES IN SECURITIES
Nothing to report under this item.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Nothing to report under this item.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Nothing to report under this item.
ITEM 5. OTHER INFORMATION
Nothing to report under this item.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
27.00 Financial Data Schedule. Filed herewith.
99.01 Press release regarding acquisition
of McNeill Systems Division
dated October 24, 1996. Filed herewith.
99.02 Press release regarding third quarter
earnings dated November 14, 1996. Filed herewith.
99.03 Press release regarding stock repurchase
program dated November 14, 1996. Filed herewith.
(b) Reports on Form 8-K.
None.
11
<PAGE>
SIGNATURE
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.
Industrial Scientific Corporation
(Registrant)
Date: December 5, 1996
By: /s/ James P. Hart
---------------------------------------------
James P. Hart
Vice-President and Chief Financial Officer
(Principal Financial Officer and Principal
Accounting Officer and an authorized signatory)
12
<PAGE>
EXHIBIT INDEX
-------------
Sequential Page Number
Exhibit No. or Reference
- ----------- ------------
27.00 Financial Data Schedule. Filed herewith at page 14.
99.01 Press release regarding acquisition of
McNeill Systems Division dated October
24, 1996. Filed herewith at page 15.
99.02 Press release regarding third quarter
earnings dated November 14, 1996. Filed herewith at page 16.
99.03 Press release regarding stock repurchase
program dated November 14, 1996. Filed herewith at page 18.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM 9 MONTHS
F/STMTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JAN-25-1997
<PERIOD-START> JAN-28-1996
<PERIOD-END> OCT-26-1996
<CASH> 5,328,440
<SECURITIES> 8,303,754
<RECEIVABLES> 4,412,032
<ALLOWANCES> 65,129
<INVENTORY> 3,735,462
<CURRENT-ASSETS> 22,485,851
<PP&E> 13,302,416
<DEPRECIATION> 5,884,366
<TOTAL-ASSETS> 38,142,312
<CURRENT-LIABILITIES> 3,248,877
<BONDS> 2,900,000
0
0
<COMMON> 33,751
<OTHER-SE> 30,516,681
<TOTAL-LIABILITY-AND-EQUITY> 38,142,312
<SALES> 27,089,029
<TOTAL-REVENUES> 27,089,029
<CGS> 12,186,106
<TOTAL-COSTS> 22,753,620
<OTHER-EXPENSES> 27,150
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 145,379
<INCOME-PRETAX> 4,569,462
<INCOME-TAX> 1,590,000
<INCOME-CONTINUING> 2,979,462
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,979,462
<EPS-PRIMARY> .88
<EPS-DILUTED> .88
</TABLE>
<PAGE>
Exhibit 99.01
NEWS RELEASE
INDUSTRIAL SCIENTIFIC
- ------------------------------------------------------------------------------
CORPORATION 1001 Oakdale Road Phone 412-788-4353
Oakdale, PA 15071-1500 1-800-DETECTS(338-3287)
USA Fax 412-788-8353
October 24, 1996
FOR IMMEDIATE RELEASE
For additional information contact:
James P. Hart, Vice President Finance and
Chief Financial Officer
INDUSTRIAL SCIENTIFIC CORPORATION ACQUIRES McNEILL INTERNATIONAL'S
SYSTEMS DIVISION
PITTSBURGH, PA--Industrial Scientific Corporation (NASDAQ/NMS symbol: ISCX)
announced today it has purchased all of the gas monitoring systems products
manufactured by McNeill International for an undisclosed price. McNeill
International was founded in 1989 by W. Allan McNeill and is based in
Cleveland, Ohio. Mr. McNeill has agreed to serve in a consulting capacity
to Industrial Scientific in order to insure a smooth transition and sales
integration of the products.
Kent McElhattan, President and CEO of Industrial Scientific, commented,
"This acquisition expands the products we can offer to customers as solutions
to their gas monitoring needs. Until now, Industrial Scientific has specialized
in supplying rugged, personal portable market instruments to protect humans
individually, regardless of their location. By contrast, the McNeill products
are permanently wall-mounted, making them specific to an area rather than
to a person. Due to their design, McNeill's products can be integrated into
complex control room monitoring systems, off-shore oil rigs, contamination
zones and other difficult locations."
"Most customers require a combination of portable and wall-mounted products
to address their full spectrum of needs. Market surveys indicate the total
size for McNeill's permanent mounted products is larger than the market
for personal portable instruments, thereby opening up new growth avenues
for Industrial Scientific both in North America and abroad. The marketing,
sales and distribution strength of Industrial Scientific, combined with our
extraordinarily high engineering and manufacturing standards, are expected
to accelerate sales growth for the McNeill products."
"We are extremely pleased that Allan McNeill has agreed to join our sales
and marketing team in a special consulting capacity. His extensive and
successful experience in the industry will expedite this project."
Industrial Scientific is offering full employment to all McNeill employees
along with relocation packages covering their move to Pittsburgh.
Headquartered in Oakdale, Pennsylvania, Industrial Scientific Corporation
designs, manufactures and sells gas monitoring instruments and other technical
products for the preservation of life and property.
<PAGE>
Exhibit 99.02
NEWS RELEASE
INDUSTRIAL SCIENTIFIC
- --------------------------------------------------------------------------------
CORPORATION
Date: November 14, 1996 1001 Oakdale Road
Oakdale, PA 15071-1500
Release: Immediately USA
(412) 788-4353
Contact: James P. Hart, Vice President Finance 1-800-DETECTS (338-3287)
Chief Financial Officer, 412-788-4353 FAX (412) 788-8353
INDUSTRIAL SCIENTIFIC CORPORATION
ANNOUNCES FISCAL YEAR 1996 THIRD QUARTER RESULTS
PITTSBURGH, PA--November 14, 1996--Industrial Scientific Corporation
(NASDAQ/NMS symbol: ISCX) today reported results for the third quarter ended
October 26, 1996.
Net sales for the third quarter were $8,656,000, up 0.3% from $8,626,000
recorded in the third quarter of 1995. Net income totaled $1,065,000 or
$0.31 per share an increase of 12.5% compared to $946,000 or $0.28 per share
for the third quarter last year.
Net sales for the nine-months ended October 26, 1996 increased 5.5% to
$27,089,000 compared to $25,688,000 for the nine months ended October 28,1995.
Net income totaled $2,979,000 or $0.88 per share for the current nine month
period compared to $2,997,000 or $0.89 for the prior year period.
Kent D. McElhattan, President and CEO, stated, "I am very pleased that net
income increased 12.5% for the quarter and totaled 12.3% of net sales. Although
sales were flat for the quarter we continue to achieve an increase on a
year to date basis resulting from the international expansion begun in late
1994. Another highlight of the quarter was the acquisition of McNeill
International's Systems Division which was completed on October 24, 1996.
This acquisition demonstrates our commitment to expanding product lines,
thereby providing a wider range of solutions to our customers. The McNeill
products are permanently installed gas monitors which complement Industrial
Scientific portable instruments. Although we have incurred technical delays,
work on commercial development of the MG2100 Portable Mass Spectrometer
is continuing forward. Beta site testing is scheduled to begin early 1997
and continue for 12 months. I remain excited by the long term potential
of this product."
Headquartered in Oakdale, Pennsylvania, Industrial Scientific Corporation
designs, manufactures and sells gas monitoring instruments and other technical
products for the preservation of life and property.
Information contained in this release concerning the Company's development
and introduction of the MG2100 Portable Mass Spectrometer is forward-looking.
These statements represent the Company's reasonable judgment and expectations
and are subject to risks and uncertainties that could cause actual results
to differ materially from these statements. Factors which could impact these
results include technological change, unanticipated delays in the production
schedule, market developments, market acceptance of the product and the
availability of component parts.
<PAGE>
INDUSTRIAL SCIENTIFIC CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statement of Income
(Unaudited)
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
10/26/96 10/28/95 10/26/96 10/28/95
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net sales $8,656 $8,625 $27,089 $25,688
Gross profit 4,886 4,631 14,721 13,685
Operating profit 1,524 1,254 4,153 4,125
Net income 1,064 946 2,979 2,997
Net income per common share $ 0.31 $ 0.28 $ 0.88 $ 0.89
Weighted average number of
common and common equivalent
shares outstanding 3,375 3,389 3,377 3,392
</TABLE>
<PAGE>
Exhibit 99.03
NEWS RELEASE
INDUSTRIAL SCIENTIFIC
- --------------------------------------------------------------------------------
CORPORATION
Date: November 14, 1996 1001 Oakdale Road
Oakdale, PA 15071-1500
Release: Immediately USA
(412) 788-4353
Contact: James P. Hart, Vice President Finance 1-800-DETECTS (338-3287)
Chief Financial Officer FAX (412) 788-8353
412-788-4353
INDUSTRIAL SCIENTIFIC CORPORATION ANNOUNCES STOCK REPURCHASE PROGRAM
PITTSBURGH, PA--November 14, 1996--Industrial Scientific Corporation
(NASDAQ/NMS symbol: ISCX) announced today that its Board of Directors has
authorized the repurchase of up to 10%, or 337,500 shares of its issued
and outstanding common stock from time to time in the open market or in
privately negotiated transactions.
Kent D. McElhattan, President and CEO, commented, "We believe this repurchase
will enhance shareholder value by increasing earnings per share and book
value of the remaining outstanding shares. The Board believes that Industrial
Scientific stock is currently undervalued by the marketplace and represents
an excellent investment opportunity for the Company.
"Recently, Industrial Scientific completed the acquisition of the Systems
Division of McNeill International and reported increased earnings for the
third quarter. These two events, combined with this repurchase program show
that Industrial Scientific is taking action to positively impact shareholder
value."
Headquartered in Oakdale, Pennsylvania, Industrial Scientific Corporation
designs, manufactures and sells gas monitoring instruments and other technical
products for the preservation of life and property.
