<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED AUGUST 1, 1998
[ ] 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) Zip Code
(Registrant's telephone number, including area code): 412-788-4353
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 September 11, 1998, there were 3,378,722 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 -
August 1, 1998 and January 31, 1998. 3
Condensed Consolidated Statement of Income -
Three months and six months ended August 1, 1998
and August 2, 1997. 4
Condensed Consolidated Statement of Cash Flows -
Six months ended August 1, 1998 and August 2, 1997. 5
Notes to Condensed Consolidated Financial Statements. 6
Item 2. Management's Discussion and Analysis of Results
of Operations and Financial Condition. 8
Item 3. Quantitative and Qualitative Disclosure about
market risk sensitive Instruments. 12
Part II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K. 12
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>
August 1, January 31,
1998 1998
----------- -----------
(Unaudited) **
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $4,018 $3,244
Short-term investments 7,404 13,368
----------- -----------
11,422 16,612
Accounts receivable, net 6,371 5,949
Inventories 4,759 3,887
Prepaid expenses and other assets 690 828
Deferred income taxes 495 481
----------- -----------
Total current assets 23,737 27,757
Long-term investments 14,403 7,309
Property, plant, and equipment, at cost 15,524 14,925
Less accumulated depreciation and amortization 8,326 7,591
----------- -----------
7,198 7,334
Land 390 390
Intangible assets, net 205 233
Other assets 1,178 858
----------- -----------
Total assets $47,111 $43,881
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $2,260 $1,445
Accrued payroll and related items 1,284 1,977
Accrued warranty expenses 704 662
Income taxes payable 417 ---
Current portion of term debt 375 375
----------- -----------
Total current liabilities 5,040 4,459
Term debt 3,481 3,663
Deferred income taxes 215 167
----------- -----------
Total liabilities 8,736 8,289
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 3,378,722 shares and
3,376,307 at 8/1/98 and at 1/31/98 34 34
Additional paid-in capital 5,531 5,492
Retained earnings 35,181 31,793
Dividends paid (743) (405)
Treasury stock, 85,400 shares at 8/1/98 and
72,400 shares at 1/31/98, at cost (1,628) (1,322)
----------- -----------
Total shareholders' equity 38,375 35,592
----------- -----------
Total liabilities and shareholders' equity $47,111 $43,881
=========== ===========
</TABLE>
** - Summarized from audited January 31, 1998 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 six months ended
August 1, August 2, August 1, August 2,
1998 1997 1998 1997
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net sales $11,269 $9,261 $22,665 $20,213
Cost of goods sold 4,678 4,259 9,577 9,022
--------- --------- --------- ---------
Gross profit 6,591 5,002 13,088 11,191
Operating expenses:
Selling 2,489 2,025 5,054 4,517
Research, development and
engineering 748 711 1,580 1,488
Administrative 952 808 1,799 1,783
--------- --------- --------- ---------
Total operating expenses 4,189 3,544 8,433 7,788
--------- --------- --------- ---------
Operating profit 2,402 1,458 4,655 3,403
Interest income 271 248 525 464
Interest expense (39) (46) (80) (85)
Other income (expense) (35) 17 (30) 20
Gain on sale of Monitor Group --- 580 --- 580
--------- --------- --------- ---------
Income before income taxes 2,599 2,257 5,070 4,382
Provision for income taxes 863 790 1,683 1,534
--------- --------- --------- ---------
Net income $1,736 $1,467 $3,387 $2,848
========= ========= ========= =========
Net income per basic common share:
Basic earnings per share $0.53 $0.44 $1.03 $0.85
Weighted average shares - basic 3,295 3,341 3,297 3,352
Net income per diluted common share:
Diluted earnings per share $0.52 $0.44 $1.02 $0.85
Weighted average shares - diluted 3,311 3,348 3,312 3,348
</TABLE>
4
<PAGE>
INDUSTRIAL SCIENTIFIC CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited, in thousands)
<TABLE>
<CAPTION>
For the six months ended
August 1, August 2,
1998 1997
---------- ----------
<S> <C> <C>
Cash flows from operating activities:
Net income $3,387 $2,848
Depreciation, amortization and other non-cash items 763 693
Gain on sale of Monitor Group --- (580)
Changes in operating assets and liabilities (541) 31
---------- ----------
Net cash provided by operating activities 3,609 2,992
Cash flows from investing activities:
Capital expenditures (599) (948)
Decrease / (increase) in equity investment 30 (241)
Proceeds from maturities of investments 6,916 6,902
Purchase of investments (8,045) (10,657)
Purchase of officer's life insurance (350) (307)
Proceeds from sale of Monitor Group --- 2,500
---------- ----------
Net cash used in investing activities (2,048) (2,751)
Cash flows from financing activities:
Purchase of treasury stock (306) (686)
Proceeds from exercise of stock options 39 ---
Principal payments on debt (182) (284)
Dividends paid (338) (135)
---------- ----------
Net cash used in financing activities (787) (1,105)
Net increase / (decrease) in cash and cash equivalents 774 (864)
Cash and cash equivalents at beginning of period 3,244 6,879
---------- ----------
Cash and cash equivalents at end of period $4,018 $6,015
========== ==========
</TABLE>
The accompanying notes are an integral part of the condensed consolidated
financial statements.
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 $97,000 and $75,000 at August
1, 1998 and August 2, 1997, respectively.
(4) Inventories consisted of:
August 1, January 31,
1998 1998
(in thousands)
--------- -----------
At standard costs, which approximate
first-in, first-out cost:
Raw materials $3,832 $3,314
Work in process 631 423
Finished goods 446 300
------ ------
4,909 4,037
Less LIFO reserves 150 150
------ ------
Inventories at LIFO value $4,759 $3,887
====== ======
continued
6
<PAGE>
(5) The effective tax rate of 33.2% for the three months ended August 1,
1998 is based upon an estimate of the effective rate for the year
ended January 31, 1998. 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 income benefits, offset by the effect of state and
local income taxes.
(6) The Company has initiated a review to ensure that its information
systems can properly handle data which include year 2000 dates. All of
the Company's major software systems have been certified by their
manufacturer to be year 2000 compliant. The Company believes that no
significant modifications or replacement of these systems will be
necessary. Management does not expect the cost of this review or any
resulting replacement or modification of information systems will have
a material adverse effect on the financial position, results of
operations or liquidity of the Company.
7
<PAGE>
Part 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
periods ended August 1, 1998 and August 2, 1997 and with the Company's audited
financial statements and notes thereto for the fiscal year ended January 31,
1998. The following Management's Discussion and Analysis of Financial Condition
and Results of Operations contains certain forward looking statements that
involve substantial risk and uncertainties. When used in this section, the
words "anticipate," "believe," "estimate," "expect," and similar expressions as
they relate to the Company or its management are intended to identify such
forward looking statements. The Company's actual results, performance or
achievements could differ materially from the results expressed in, or implied
by, these forward-looking statements. Factors that could cause or contribute to
such differences include those listed in the Company's 10-K for fiscal year
1997.
Results of Operations
Quarter ended August 1, 1998 Compared to Quarter Ended August 2, 1997
Net sales for the quarter ended August 1, 1998 ("second quarter 1998") were
$11.3 million, an increase of 21.7% or $2.0 million compared to net sales of
$9.3 million for the quarter ended August 2, 1997 ("second quarter 1997").
Increased sales resulted from winning a large order for TMX412 portable multi-
gas instruments and accessories, and increased repair and rental services.
Sales of the newly introduced ATX series of portable multi-gas instruments and
the T-80 portable single gas instrument also contributed to this revenue
increase.
Gross profit increased 31.8% or $1.6 million to $6.6 million for the second
quarter 1998 compared to $5.0 million for the second quarter 1997. Gross profit
as a percentage of net sales increased to 58.5% for the second quarter 1998
compared to 54.0% for the second
8
<PAGE>
quarter 1997. An increased portion of sales for the quarter were to end users
which generally earn a higher gross profit percentage than sales to
distributors. The Company does not expect this change in sales mix to continue
and anticipates gross profit as a percentage of net sales to average 55.0% to
57.0% for the balance of fiscal 1998. Increased rental services and spare parts
sales which earn a higher than average gross profit percentage also improved
gross profit percentage for the quarter.
Operating expenses totaled $4.2 million for the second quarter 1998 an increase
of 18.2% compared to $3.5 million for the second quarter 1997. Selling expense
increased $464,000 or 23.0% resulting from increased commission expense relating
to increased sales, increased marketing of fixed systems products and continuing
efforts to establish an international sales and distribution network. Research,
development and engineering expense increased $36,000 or 5.1% due to increased
new product development. Administrative expense increased $144,000 or 17.8%
principally resulting from increased incentive expense relating to improved
financial performance. Approximately $90,000 of the increase in administrative
expense resulted from an adjustment relating to the first quarter which was
completed in the second quarter 1998.
Interest income increased $23,000 in the second quarter 1998 due to higher
invested cash balances and higher interest rates. Interest expense decreased
due to reduced debt balances resulting from continuing principal payments on
outstanding loans. Other expense totaled $35,000 which is the Company's portion
of operating results of the two joint ventures in which it participates.
Industrial Scientific Arabia Ltd., a joint venture based in Saudi Arabia was
profitable during the quarter but this profit was more than offset by a loss
incurred by HEG Industrial Scientific which is based in Harbin, China.
The effective tax rate for the second quarter 1998 was 33.2%, down from the
effective rate for the second quarter 1997, but consistent with the effective
rate for all of fiscal year 1997.
Net income for the second quarter 1998 totaled $1.7 million or $0.53 per share,
an increase of 18.3% compared to $1.5 million or $0.44 per share for the second
quarter 1997.
Results of Operations
Six Months Ended August 1, 1998 Compared to Six Months Ended August 2, 1997
Net sales for the six months ended August 1, 1998 ( "first half 1998") totaled
$22.7 million, an increase of 12.1% or $2.5 million over net sales of $20.2
million for the six months ended August 2, 1997 ("first half 1997"). Sales of
the newly introduced ATX series of portable multi-gas instruments and the T-80
portable single gas instrument, combined with a large order for TMX412 multi-gas
instruments principally account for this increase.
9
<PAGE>
Gross profit increased $1.9 million or 17.0% to $13.1 million for the first half
1998 compared to $11.2 million for the first half 1997. Gross profit as a
percent of net sales increased to 57.7% for the first half 1998 compared to
55.4% for the first half 1997. A greater than average portion of net sales were
to end users during the first half 1998 which earn a higher gross profit
percentage. The Company does not expect this change in sales mix to continue and
anticipates gross profit as a percentage of net sales to average 55.0% to 57.0%
for fiscal 1998. In addition, increased rental services and spare parts sales
which also earn higher gross profit percentage account for the increase in gross
profit as a percentage of net sales.
Operating expenses increased 8.3% or $645,000 to $8.4 million for the first half
1998 compared to $7.8 million for the first half 1997. Selling expenses
increased $537,000 or 11.9% due to increased marketing of fixed systems
products, increased commission expense relating to higher sales and ongoing
efforts to establish an international sales and distribution network. Research,
development and engineering expense increased $92,000 or 6.2% due to increased
new product development in both portable and fixed systems product lines.
Administrative expense was virtually unchanged for the first half 1998 compared
to the first half 1997.
Interest income increased $61,000 or 13.1% to $525,000 for the first half 1998
compared to $464,000 for the first half 1997 due to higher invested cash
balances and higher interest rates. Interest expense declined modestly due to
lower outstanding loan balances resulting from continuing principal payments.
Other expense consists of the Company's portion of results from two joint
ventures that the Company participates in. Industrial Scientific Arabia Ltd.,
based in Saudi Arabia was modestly profitable for the first half 1998 but these
results were more than offset by losses from HEG Industrial Scientific based in
China. Losses from HEG Industrial Scientific are primarily due to start up
expenses and slower than anticipated sales growth.
The effective tax rate for the first half 1998 was 33.2%, equal to the effective
tax rate for all of 1997.
Net income for the first half 1998 totaled $3.4 million or $1.03 per share, an
increase of 18.9% compared to $2.8 million or $0.85 per share for the first half
1997.
Liquidity and Capital Resources
Cash flow from operations totaled $3.6 million for the first half 1998 compared
to $3.0 million for the first half 1997. Higher net income, depreciation,
amortization and other non-cash items partially offset by increased net
investment in operating assets principally account for this increase.
10
<PAGE>
Capital expenditures totaled $599,000 in the first half 1998 compared to
$948,000 for the first half 1997. Capital expenditures in the first half 1998
consisted principally of inventory storage and retrieval systems, production
tooling and test equipment and computer hardware and software. Capital
expenditures are expected to increase in the second half of 1998 and exceed the
1997 total of $1.5 million by year end. In June 1997 the Company completed the
sale of Monitor Group for $2.5 million in cash, which resulted in a gain of
$580,000. During the first half 1998 the Company used $306,000 to repurchase
shares of stock under the previously announced stock repurchase plan. The
Company paid two quarterly dividends of $0.05 per share during the first half
1998 which totaled $338,000 and on August 11, 1998 declared a third quarter
dividend of $0.05 which will total $169,000. The Company paid its first
quarterly dividend of $0.04 per share during the first half 1997 which totaled
$135,000.
Working Capital totaled $18.7 million as of August 1, 1998 compared to $23.3
million as of January 31, 1998, a decrease of $4.6 million, principally
resulting from an increase in long term investments which reduces current assets
and working capital. 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.
YEAR 2000
The Company has initiated a review to ensure that its information systems can
properly handle data which include year 2000 dates. All of the Company's major
software systems have been certified by their manufacturer to be year 2000
compliant. The Company believes that no significant modifications or
replacement of these systems will be necessary. The Company further believes
that it has no material exposure to contingencies related to Year 2000 issues
for the products it has sold. Management does not expect the cost of this
review or any resulting replacement or modification of information systems will
have a material adverse effect on the financial position, results of operations
or liquidity of the Company.
11
<PAGE>
PART 1. FINANCIAL INFORMATION
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT
MARKET RISK SENSITIVE INSTRUMENTS
The Company currently does not invest excess funds in derivative financial
instruments or other market risk sensitive instruments for the purpose of
managing its foreign currency exchange rate risk or for any other purpose.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Nothing to report under this item.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
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.
27.0 Financial Data Schedule. Filed herewith.
99.01 Press release announcing third quarter dividend
of five cents dated August 13, 1998. Filed herewith.
99.02 Press release announcing Fiscal 1998 Second
Quarter results dated August 19, 1998. Filed herewith.
(b) Reports on Form 8-K.
None.
12
<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: September 11, 1998
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)
13
<PAGE>
EXHIBIT INDEX
-------------
Sequential Page Number
Exhibit No. or Reference
- ----------- ------------
27.0 Financial Statement Data. Filed herewith at page 15.
99.01 Press release announcing third quarter
dividend of five cents dated
August 13, 1998. Filed herewith at page 16.
99.02 Press release announcing Fiscal 1998
Second Quarter results dated
August 19, 1998. Filed herewith at page 17.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-30-1999
<PERIOD-START> MAY-03-1998
<PERIOD-END> AUG-01-1998
<CASH> 4,018,038
<SECURITIES> 0
<RECEIVABLES> 6,426,614
<ALLOWANCES> 55,877
<INVENTORY> 4,759,307
<CURRENT-ASSETS> 23,737,265
<PP&E> 15,523,546
<DEPRECIATION> 8,326,339
<TOTAL-ASSETS> 47,110,928
<CURRENT-LIABILITIES> 5,040,393
<BONDS> 2,500,000
0
0
<COMMON> 33,787
<OTHER-SE> 38,340,739
<TOTAL-LIABILITY-AND-EQUITY> 47,110,928
<SALES> 11,269,568
<TOTAL-REVENUES> 11,269,568
<CGS> 4,678,321
<TOTAL-COSTS> 8,867,115
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 39,549
<INCOME-PRETAX> 2,599,128
<INCOME-TAX> 863,000
<INCOME-CONTINUING> 1,736,128
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,736,128
<EPS-PRIMARY> .53
<EPS-DILUTED> .52
</TABLE>
<PAGE>
LOGO INDUSTRIAL SCIENTIFIC
Date: August 13, 1998
Release: Immediate
Contact: James P. Hart, Vice President Finance
Chief Financial Officer
412-490-1843
INDUSTRIAL SCIENTIFIC CORPORATION ANNOUNCES
THIRD QUARTER DIVIDEND OF FIVE CENTS ($.05) PER SHARE
PITTSBURGH, PA -- Industrial Scientific Corporation (NASDAQ/NM symbol: ISCX )
today announced that the Board of Directors declared a dividend of Five Cents a
share ($.05) payable on September 1, 1998, to stockholders on record as of
August 24, 1998.
Headquartered in Oakdale, Pennsylvania, Industrial Scientific Corporation
designs, manufactures and sells gas monitoring instruments, systems and other
technical products for the preservation of life and property.
ISO9001
CERTIFIED
O U R M I S S I O N
Design-Manufacture-Sell: The highest quality products for the preservation of
life and property
Provide: Best customer service available
<PAGE>
LOGO INDUSTRIAL SCIENTIFIC
Date: August 19, 1998
Release: Immediately
Contact: James P. Hart, Vice President Finance
Chief Financial Officer 412-490-1843
INDUSTRIAL SCIENTIFIC CORPORATION
ANNOUNCES FISCAL YEAR 1998 SECOND QUARTER RESULTS
PITTSBURGH, PA-- August 19, 1998 -- Industrial Scientific Corporation
(NASDAQ/NMS symbol: ISCX) today reported results for the second quarter ended
August 1, 1998.
Net sales for the second quarter 1998 totaled $11,270,000 up 21.7% from
$9,261,000 for the second quarter 1997. Net income for the second quarter 1998
totaled $1,736,000 or $0.53 per share, an increase of 18.3% compared to
$1,467,000 or $0.44 per share for the second quarter 1997. Second quarter 1997
net income included a gain on the sale of Monitor Group which totaled $377,000.
Excluding this gain, net income for the second quarter 1998 increased 59.3% over
the comparable net income of $1,090,000 for the second quarter 1997.
Net sales for the six-months ended August 1, 1998 increased 12.1% to $22,665,000
compared to $20,213,000 for the six-months ended August 2, 1997. Net income for
the six-months ended August 1, 1998 was $3,387,000 or $1.03 per share, an
increase of 18.9% over net income of $2,848,000 or $0.85 per share for the six-
months ended August 2, 1997. Net income for the six months ended August 2, 1997
included the gain on the sale of Monitor Group. Excluding this gain, net income
for the six months ended August 1, 1998 increased 37.1% over the comparable
prior period.
Kent D. McElhattan, President and CEO, stated, "Industrial Scientific continues
to produce outstanding financial results. Sales growth of 22% for the quarter
and 12% year to date generated net income gains of 59% for the quarter and 37%
year to date, excluding the gain on the sale of Monitor Group from last year's
results. We continue to emphasize new product development as our primary growth
strategy with positive results from the recently introduced ATX series of
portable gas monitoring instruments. Several significant market expansion
initiatives are moving successfully forward and cause us to be optimistic about
Industrial Scientific's growth potential. For example, testing of our new
ammonia optical sensor for the agricultural industry has recently moved from our
laboratories to customer beta sites. Early technical reports are highly
encouraging."
Headquartered in Oakdale, Pennsylvania, Industrial Scientific Corporation
designs, manufactures and sells gas monitoring instruments, systems and other
technical products for the preservation of life and property.
Certain statements contained in this release may be considered forward-looking.
These statements represent the Company's reasonable judgment and expectations
and are subject to risks and uncertainties, including those listed in the
Company's Annual Report on Form 10-K for fiscal year 1997, that could cause
actual results to differ materially from these statements.
ISO9001
CERTIFIED
O U R M I S S I O N
Design-Manufacture-Sell: The highest quality products for the preservation of
life and property
Provide: Best customer service available
<PAGE>
INDUSTRIAL SCIENTIFIC CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statement of Operations
(Unaudited)
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Three months ended Six months ended
08/01/98 08/02/97 08/01/98 08/02/97
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net sales $11,270 $ 9,261 $ 22,665 $ 20,213
Gross profit 6,591 5,002 13,088 11,191
Operating profit 2,402 1,458 4,655 3,403
Net income 1,736 1,467 3,387 2,848
Net income per basic common share:
Basic earnings per share .53 .44 1.03 .85
Weighted average shares - basic 3,295 3,341 3,297 3,352
Net income per diluted common share:
Diluted earnings per share .52 .44 1.02 .85
Weighted average shares - diluted 3,311 3,348 3,312 3,348
</TABLE>
