[TEXT]
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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
{X} QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the quarterly period ended June 30, 1996
-------------
{ } TRANSITION REPORT PURSUANT TO SECTION 13 OF 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the transition period from ........ to .........
Commission file number: 0-22268
NATIONAL R.V. HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Delaware 33-0371079
-------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3411 N. Perris Blvd.
Perris, California 92571
(909) 943-6007
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices)
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 _____
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at July 30, 1996
- ----- ----------------------------
Common stock, par value 4,796,474
$.01 per share
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<TABLE>
<CAPTION>
NATIONAL R.V. HOLDINGS, INC.
INDEX
PAGE
----
<S> <C>
PART 1 - FINANCIAL INFORMATION
Item 1. Consolidated Balance Sheet -
June 30, 1996 and December 31, 1995 3
Consolidated Statement of Income -
Three and Six Months Ended June 30, 1996 and 1995 4
Consolidated Statement of Cash Flows -
Six Months Ended June 30, 1996 and 1995 5
Consolidated Statement of Changes in Stockholders' Equity 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8 - 9
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 10
Signature 11
</TABLE>
2
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<TABLE>
<CAPTION>
NATIONAL R.V. HOLDINGS, INC.
CONSOLIDATED BALANCE SHEET
(In thousands)
(Unaudited)
June 30, Dec. 31,
1996 1995
-------- --------
<S> <C> <C>
ASSETS
Current Assets:
Cash $ 3,257 $ 73
Trade receivables, less allowance for
doubtful accounts of $40,000 4,767 6,683
Inventories 15,900 14,347
Deferred income taxes 770 483
Prepaid expenses 526 393
-------- --------
Total current assets 25,220 21,979
Restricted funds 2,768 4,847
Property, plant and equipment, net 9,742 7,482
-------- --------
$ 37,730 $ 34,308
======== ========
LIABILITIES AND STOCKHOLDER'S EQUITY
Current liabilities:
Line of credit $ - $ 1,900
Current portion of long-term debt 146 146
Accounts payable 3,143 3,405
Accrued expenses 2,406 1,448
-------- --------
Total current liabilities 5,695 6,899
Deferred income taxes 1,738 1,750
Long-term debt 6,961 7,034
Commitments and contingencies
Stockholders' equity:
Preferred stock - $.01 par value; 5,000 shares
authorized, 4,000 issued and outstanding - -
Common stock - $.01 par value; 10,000,000 shares
authorized 59 37
Additional paid-in capital 22,417 21,062
Accumulated earnings 8,144 4,521
Less - cost of treasury stock ( 7,284) ( 6,995)
-------- --------
Total stockholders' equity 23,336 18,625
-------- --------
$ 37,730 $ 34,308
======== ========
</TABLE>
See Notes to Consolidated Financial Statements
3
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<TABLE>
<CAPTION>
NATIONAL R.V. HOLDINGS, INC.
CONSOLIDATED STATEMENT OF INCOME
(In thousands except per share data)
(Unaudited)
Three Months Six Months
------------------ -----------------
Ended June 30, Ended June 30,
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net sales $ 32,686 $ 21,464 $ 67,819 $ 42,874
Cost of goods sold 28,307 18,393 58,761 36,984
-------- -------- -------- --------
Gross profit 4,379 3,071 9,058 5,890
Selling expenses 774 608 1,648 1,239
General and administrative expenses 636 904 1,185 1,382
-------- -------- -------- --------
Operating income 2,969 1,559 6,225 3,269
Other expense (income):
Interest expense 77 218 195 443
Interest income ( 65) ( 211) ( 136) ( 432)
Other financing related costs 37 28 77 52
-------- -------- -------- --------
Income before income taxes and
extraordinary item 2,920 1,524 6,089 3,206
Provision for income taxes 1,183 557 2,466 1,236
Income before extraordiary item 1,737 967 3,623 1,970
Extraodinary loss on investment in
marketable equity securities,no
tax effect - ( 958) - ( 958)
-------- -------- -------- --------
Net income $ 1,737 $ 9 $ 3,623 $ 1,012
Earnings per common share and common equivalent shares:
Income before extraordinary item $ 0.34 $ 0.20 $ 0.73 $ 0.40
Extraordinary item - ( 0.20) - ( 0.20)
-------- -------- -------- --------
Net income $ 0.34 $ - $ 0.73 $ 0.20
======== ======== ======== ========
Earnings per common share - assuming full dilution
Income before extraordinary item $ 0.34 $ 0.20 $ 0.71 $ 0.40
Extraordinary item - ( 0.20) - ( 0.20)
-------- -------- -------- --------
Net income $ 0.34 $ - $ 0.71 $ 0.20
Weighted average number of shares:
Primary 5,106 4,901 4,961 4,889
Fully diluted 5,120 4,902 5,082 4,890
</TABLE>
See Notes to Consolidated Financial Statements
4
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<TABLE>
<CAPTION>
NATIONAL R.V. HOLDINGS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(In thousands)
(Unaudited)
Three Months Six Months
------------------ -----------------
Ended June 30, Ended June 30,
1996 1995 1996 1995
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Cash flows from operating activities:
Net income $ 3,623 $ 1,012 $ 3,623 $ 1,012
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation expense 238 211 238 211
Amortization of deferred financial
income - ( 123) - ( 123)
Loss on investment in marketable
equity securities - 958 - 958
Gain on disposition of equipment - ( 23) - ( 23)
Decrease in trade receivables 1,916 304 - -
(Increase) decrease in
inventories ( 1,553) 592 - -
(Increase) decrease in prepaid
expenses ( 133) 159 - -
Decrease in accounts payable ( 262) ( 70) - ( 1)
Increase in accrued expenses 958 171 - ( 1)
(Decrease) increase in deferred
income taxes ( 299) 45 - 45
-------- -------- -------- --------
Net cash provided (used) by
operating activities 4,488 3,236 3,861 2,078
Cash flows from investing activities:
Proceeds from disposition of equipment - 23 - 23
Purchases of property, plant and
equipment ( 2,498) ( 420) ( 2,498) ( 420)
-------- -------- -------- --------
Net cash provided (used) by
investing activities ( 2,498) ( 397) ( 2,498) ( 397)
Cash flows from financing activities:
Net payments under line of credit ( 1,900) ( 2,800) ( 1,900) -
Decrease in restricted funds 2,079 - 2,079 -
Principal payments on revenue bonds ( 73) ( 95) ( 73) -
Proceeds from issuance of common stock 1,377 53 1,377 53
Purchase of treasury stock ( 289) - ( 289) -
-------- -------- -------- --------
Net cash provided (used) by
financing activities 1,194 ( 2,842) 1,194 53
-------- -------- -------- --------
Net increase (decrease) in cash 3,184 ( 3) 2,557 1,734
Cash beginning of period 73 301 - 301
-------- -------- -------- --------
Cash end of period $ 3,257 $ 298 $ 2,557 $ 2,035
======== ======== ======== ========
</TABLE>
See Notes to Consolidated Financial Statements
5
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<TABLE>
<CAPTION>
NATIONAL R.V. HOLDINGS, INC.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
(In thousands except shares)
(Unaudited)
Common Stock
Preferred -------------- Paid-in Retained
Stock Shares Amount Capital Earnings
------- --------- ------ ------- --------
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1995 $ - 5,555,162 $ 37 $21,062 $ 4,521
Purchase of Treasury Stock
Common Stock issued upon
exercise of warrants 352,933 3 1,322
Common Stock issued under
option plan 13,379 52
Adjustment for stock split 19 ( 19)
Net income 3,623
-------- --------- ------ ------- --------
Balance, June 30, 1996 $ - 5,921,474 $ 59 $22,417 $ 8,144
======== ========= ====== ======= ========
</TABLE>
<TABLE>
<CAPTION>
(Continued from above) Treasury Stock
Shares Amount Total
---------- --------- --------
<S> <C> <C> <C>
Balance, December 31, 1995 (1,083,330) $( 6,995) $ 18,625
Purchase of Treasury Stock ( 41,670) ( 289) ( 289)
Common Stock issued upon
exercise of warrants 1,325
Common Stock issued under
option plan 52
Adjustment for stock split -
Net income 3,623
---------- -------- --------
Balance, June 30, 1996 (1,125,000) $( 7,284) $ 23,336
========== ======== ========
</TABLE>
See Notes to Consolidated Financial Statements
6
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NATIONAL R.V. HOLDINGS, INC.
PART I, ITEM 1
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - GENERAL
- ----------------
In the opinion of National R.V. Holdings, Inc. (collectively, with its
subsidiary National R.V., Inc., referred to herein as the "Company"), the
accompanying unaudited consolidated financial statements contain all adjust-
ments, consisting only of normal recurring adjustments, necessary for the fair
presentation of the financial position, results of operations and cash flows
for all periods presented. Results for the interim periods are not neces-
sarily indicative of the results for an entire year and the financial state-
ments do not include all of the information and footnotes required by
generally accepted accounting principles. These financial statements should
be read in conjunction with the financial statements and notes thereto
contained in the Company's latest annual report on Form 10-K.
On April 25, 1996, the Board of Directors declared a three-for-two
stock split to be distributed on May 16, 1996 to shareholders of record on
May 6, 1996.
NOTE 2 - INVENTORIES
- --------------------
Inventories consist of the following:
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
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<S> <C> <C>
Finished goods $ 5,572,000 $ 5,289,000
Work-in-process 1,969,000 3,211,000
Raw materials 5,624,000 5,125,000
Chassis 2,735,000 722,000
----------- -----------
$15,900,000 $14,347,000
=========== ===========
</TABLE>
7
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NATIONAL R.V. HOLDINGS, INC.
PART 1, ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
- -------------------------------
At June 30, 1996, the Company had working capital of $19.5 million compared
to $15.1 million at December 31, 1995. Net cash provided by operating
activities was $4.5 million for the six months ended June 30, 1996, compared
to $3.2 million for the same period in 1995. The increase in cash provided by
operating activities resulted from an increase in net income, and favorable
changes in accounts receivable and accrued expenses offset by an increase in
inventories.
Cash used in investing activities was $2.5 million compared to $0.4 million
for the comparable period last year. The increase was primarily due to capital
expenditures for the construction of a new 154,000 square foot building.
Cash provided by financing activities was $1.2 million compared to cash used
by financing activities of $2.8 million for the comparable period last year.
The change was primarily due to a $2.1 million decrease in restricted funds
related to the building construction and $1.4 million proceeds from the
issuance of common stock offset by a $1.9 million decrease in the line of
credit and the $0.3 million purchase of treasury stock.
The Company believes that the combination of internally generated funds,
existing capital and funds available from its existing credit facility, will
be sufficient to meet the Company's planned capital and operational require-
ments for at least the next 24 months.
Results of Operations
- ---------------------
Net sales for the second quarter of 1996 increased by $11.2 million or 52.3%
from the comparable period last year. For the first half of 1996, the Company
reported sales of $67.8 million, 58.2% higher than sales of $42.9 million for
the first half of last year. This increase resulted primarily from a shift in
product mix to the higher priced Dolphin and Tropi-Cal motorhomes and a 391
unit increase in the sales of the Company's Class A motorhomes, offset by a 78
unit decrease in the sales of the Company's fifth-wheel products.
Cost of goods sold of $28.3 million for the second quarter of 1996 resulted
in a gross margin of 13.4% compared to a gross margin of 14.3% for the same
period last year. The higher gross margin last year was due primarily to
favorable year end adjustments to cost of sales as the Company was a May fiscal
year corporation until December 31, 1995. Cost of goods sold of $58.8 million
for the first half of 1996 resulted in a gross margin of 13.4% compared to a
gross margin of 13.7% for the same period last year.
Selling expense for the second quarter of 1996 increased to $0.8 million or
2.4% of net sales, compared to $0.6 million or 2.8% of net sales for the same
period last year. Selling expense for the first half of 1996 increased to
$1.6 million or 2.4% of net sales, compared to $1.2 million or 2.9% of net
sales for the same period last year.
8
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NATIONAL R.V. HOLDINGS, INC.
PART 1, ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
General and administrative expense for the second quarter of 1996 decreased
to $0.6 million or 1.9% of net sales, compared to $0.9 million or 4.2% of net
sales for the same period last year. General and administrative expense for
the first half of 1996 decreased to $1.2 million or 1.7% of net sales, compared
to $1.4 million or 3.2% of net sales for the same period last year. The
decrease was primarily due to the payment of management bonuses in May 1995 as
the Company was still a May fiscal year corporation.
As a result of the foregoing, operating income for the second quarter of
1996 increased 90.4% to $3.0 million or 9.1% of net sales, compared to $1.6
million or 7.3% of net sales for the same period last year. Operating income
for the first half of 1996 increased 90.4% to $6.2 million or 9.2% of net
sales, compared to $3.3 million or 7.6% of net sales for the same period last
year.
Net interest expense and other financing related costs for the first half
of 1996 increased $73,000 due principally to a net interest gain last year
related to obligations to previous owners that were paid in September 1995.
As a result of the foregoing, income before income taxes and extraordinary
item for the second quarter of 1996 increased to $3.0 million or 8.9% of net
sales, compared to $1.5 million or 7.1% of net sales for the same period last
year. Income before income taxes and extraordinary item for the first half of
1996 increased to $6.1 million or 9.0% of net sales, compared to $3.2 million
or 7.5% of net sales for the same period last year.
Provision for income taxes for the second quarter of fiscal 1996 was $1.2
million compared to $0.6 million for the same period last year. Provision for
income taxes for the first half of 1996 was $2.5 million compared to $1.2
million for the same period last year. The effective tax rate for the first
half of 1996 was 40.5% compared to 38.6% for the same period last year.
As a result of the foregoing, income before extraordinary item for the
second quarter of 1996 increased to $1.7 million or 5.3% of net sales,
compared to $1.0 million or 4.5% of net sales for the same period last year.
Income before extraordinary item for the first half of 1996 increased to $3.6
million or 5.3% of net sales, compared to $2.0 million or 4.6% of net sales
for the same period last year.
The Company incurred a $958,000 extraordinary loss on its investment in
marketable equity securities in the second quarter of 1995.
As a result of the foregoing, net income for the first half of 1996
increased to $3.6 million or 5.3% of net sales, compared to $1.0 million, or
2.4% of net sales for the same period last year.
9
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PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A. Exhibits
- ------------
None
B. Form 8-K
- ------------
None
10
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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.
NATIONAL R.V. HOLDINGS, INC.
----------------------------
(Registrant)
Date: July 30, 1996 By /s/ WAYNE M. MERTES
Wayne M. Mertes
(President and Chief Executive Officer)
Date: July 30, 1996 By /s/ KENNETH W. ASHLEY
Kenneth W. Ashley
(Chief Financial Officer and Treasurer)
11
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 3,257
<SECURITIES> 0
<RECEIVABLES> 4,807
<ALLOWANCES> 40
<INVENTORY> 15,900
<CURRENT-ASSETS> 25,220
<PP&E> 12,323
<DEPRECIATION> 2,581
<TOTAL-ASSETS> 37,730
<CURRENT-LIABILITIES> 5,695
<BONDS> 6,961
0
0
<COMMON> 59
<OTHER-SE> 23,277
<TOTAL-LIABILITY-AND-EQUITY> 23,336
<SALES> 67,819
<TOTAL-REVENUES> 67,819
<CGS> 58,761
<TOTAL-COSTS> 58,761
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 195
<INCOME-PRETAX> 6,089
<INCOME-TAX> 2,466
<INCOME-CONTINUING> 3,623
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,623
<EPS-PRIMARY> .73
<EPS-DILUTED> .71
</TABLE>
