<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________
FORM 10-Q
(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, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
[COMMISSION FILE NUMBER 0-22173]
_______________
TOTAL CONTROL PRODUCTS, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
ILLINOIS 36-3209178
(State or other jurisdiction of (I.R.S Employer
incorporation or organization) Identification No.)
2001 NORTH JANICE AVENUE
MELROSE PARK, ILLINOIS 60160
(Address of principal executive offices) (Zip Code)
(708) 345-5500
(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:
COMMON STOCK, NO PAR VALUE
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
_______ ______
NUMBER OF SHARES OF COMMON STOCK OUTSTANDING ON AUGUST 8, 1997: 6,916,465
SHARES
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
TOTAL CONTROL PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
A S S E T S March 31, June 30,
---------------- 1997 1997
---- ----
<S> <C> <C>
CURRENT ASSETS: (unaudited)
Cash and cash equivalents $ 221,967 $ 923,144
Trade receivables, net of allowances of $118,000 and
$121,000 at March 31 and June 30, 1997, respectively 7,804,823 7,383,713
Raw materials inventory 2,674,668 2,702,844
Work in process and finished goods inventory 5,309,373 5,019,568
Prepaid and deferred expenses-
Taxes 1,273,696 1,373,098
Other 281,280 412,353
----------- -----------
Total current assets 17,565,807 17,814,720
----------- -----------
PROPERTY AND EQUIPMENT, net 2,393,137 2,595,693
OTHER ASSETS:
Asset held for sale 5,037,139 5,113,115
Goodwill, net 5,118,212 4,977,812
Investment in foreign joint venture 277,243 282,403
Receivable from officer 191,547 191,547
Other long-term assets 879,282 946,831
----------- -----------
Total other assets 11,503,423 11,511,708
----------- -----------
$31,462,367 $31,922,121
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements
2
<PAGE>
TOTAL CONTROL PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Continued)
<TABLE>
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY March 31, June 30,
------------------------------------ 1997 1997
---- ----
(unaudited)
<S> <C> <C>
CURRENT LIABILITIES:
Current maturities of long-term debt $ 129,272 $ 58,420
Notes payable-
Related parties 228,716 188,961
Other 183,577 138,910
Accounts payable 1,962,762 2,082,783
Accrued expenses-
Income taxes 79,483 654,913
Commissions 716,302 768,525
Payroll 735,271 684,166
Other 1,797,938 1,391,313
Deferred revenue 1,110,402 1,172,717
----------- -----------
Total current liabilities 6,943,723 7,140,708
----------- -----------
LONG-TERM LIABILITIES:
Notes payable to bank 2,215,229 1,949,990
Long-term debt, net of current maturities 47,711 33,749
Other 827,838 659,850
----------- -----------
Total long-term liabilities 3,090,778 2,643,589
----------- -----------
COMMITMENTS AND CONTINGENCIES
MINORITY INTEREST IN SUBSIDIARY 1,521,289 1,385,766
SHAREHOLDERS' EQUITY:
Common stock, no par value; 22,500,000 shares
authorized; 6,916,465 shares issued and outstanding
at March 31 and June 30, 1997, respectively 24,613,624 24,613,624
Class C Exchangeable common stock of subsidiary,
no par value; unlimited shares authorized; 737,112
shares issued and outstanding at March 31 and
June 30, 1997, respectively 4,641,110 4,641,110
Accumulated deficit (9,295,658) (8,447,120)
Foreign currency translation adjustment (52,499) (55,556)
----------- -----------
Total shareholders' equity 19,906,577 20,752,058
----------- -----------
$31,462,367 $31,922,121
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements
3
<PAGE>
TOTAL CONTROL PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED JUNE 30, 1996 AND 1997
(Unaudited)
<TABLE>
<CAPTION>
1996 1997
---- ----
<S> <C> <C>
NET SALES $ 9,077,031 $12,487,388
COST OF GOODS SOLD 5,166,668 5,655,409
----------- -----------
Gross profit 3,910,363 6,831,979
----------- -----------
OPERATING EXPENSES:
Sales and marketing 1,715,771 3,050,495
Research and development 694,980 1,257,977
General and administrative 853,378 1,241,559
----------- -----------
Income from operations 646,234 1,281,948
----------- -----------
OTHER INCOME (EXPENSES):
Interest, net (139,047) (41,830)
Earnings in foreign joint venture 39,008 8,877
Other income (expense), net (3,320) (980)
----------- -----------
Income before income taxes and
minority interest 542,875 1,248,015
PROVISION FOR INCOME TAXES 218,000 535,000
----------- -----------
Income before minority interest 324,875 713,015
MINORITY INTEREST IN LOSS OF SUBSIDIARY - 135,523
----------- -----------
Net income 324,875 848,538
ACCRETION TO REDEMPTION VALUE OF COMMON STOCK (3,462,413) -
----------- -----------
Net income (loss) available to
common shareholders $(3,137,538) $ 848,538
=========== ===========
NET INCOME (LOSS) PER SHARE AVAILABLE TO
COMMON SHAREHOLDERS $ (0.56) $ .11
=========== ===========
WEIGHTED AVERAGE NUMBER OF COMMON AND COMMON
EQUIVALENT SHARES OUTSTANDING 5,630,142 7,816,302
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
4
<PAGE>
TOTAL CONTROL PRODUCTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED JUNE 30, 1996 AND 1997
(Unaudited)
<TABLE>
<CAPTION>
1996 1997
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income for the period $ 324,875 $ 848,538
Adjustments to reconcile net income to net cash
(used in) provided by operating activities-
Minority interest in loss of subsidiary - (135,523)
Depreciation and amortization 173,465 335,525
Earnings in foreign joint venture (39,008) (8,877)
(Gain) loss on sale of property and equipment 3,320 -
Changes in operating assets and liabilities-
Trade receivables (442,425) 421,110
Inventory (1,148,207) 242,053
Prepaid expenses and other assets (98,775) (348,101)
Accounts payable, accrued expenses and other liabilities 940,514 421,956
Deferred revenue - 62,315
----------- -----------
Net cash (used in) provided by operating activities (286,241) 1,838,996
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (208,982) (371,444)
Other (786) (31,900)
----------- -----------
Net cash used in investing activities (209,768) (403,344)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net increase (decrease) in notes payable to bank 800,000 (265,239)
Payments on long-term debt and notes payable (98,929) (169,236)
Payments of offering costs - (300,000)
----------- -----------
Net cash provided by (used in) financing activities 701,071 (734,475)
----------- -----------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 205,062 701,177
CASH AND CASH EQUIVALENTS, beginning of period 19,058 221,967
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 224,120 $ 923,144
=========== ===========
SUPPLEMENTAL DISCLOSURE:
Cash paid during the period for-
Income taxes $ 201,000 $ 14,570
Interest 132,925 80,320
=========== ===========
NONCASH INVESTING AND FINANCING ACTIVITIES:
Conversion of subordinated debentures into
67,873 shares of common stock $ 50,000 $ -
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
5
<PAGE>
TOTAL CONTROL PRODUCTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1997
(unaudited)
NOTE 1 - INTERIM FINANCIAL INFORMATION
The consolidated financial information herein is unaudited, other than the
Consolidated Balance Sheet information as of March 31, 1997, which is derived
from audited financial statements.
In the opinion of management, the accompanying interim consolidated financial
statements contain all adjustments (consisting only of normal recurring
adjustments) necessary to present fairly the Company's financial position as
of June 30, 1996 and 1997, the results of operations for the three months
ended June 30, 1996 and 1997 and changes in cash flows for the three months
ended June 30, 1996 and 1997.
While it is management's belief that the disclosures presented are adequate
to make the information not misleading, it is suggested that the consolidated
financial statements be read in conjunction with the consolidated financial
statements and notes included in the Company's 1997 annual report on Form
10-K filed with the Securities and Exchange Commission.
The results of the three months ended June 30, 1997, are not necessarily
indicative of the results to be expected for the entire year.
NOTE 2 - SUBSEQUENT EVENT
Subsequent to June 30, 1997, the Company signed a letter of intent with
Neil R. Taylor for the sale of the labor scheduling software product line
currently held for sale. Mr. Taylor, the former principal shareholder of the
Company's majority-owned subsidiary, Taylor Industrial Software, Inc.
("Taylor"), is an officer and a member of the Company's board of directors.
The proposed sale price is approximately $4 million, of which $2 million will
be in cash and $2 million will be in the form of a note receivable payable in
equal installments upon the second, third, fourth, fifth and sixth year
anniversary of the note. The note will bear interest at 8% and is secured by
250,000 shares of convertible Class C exchangeable stock of the Taylor
subsidiary currently held by Mr. Taylor. As a result of this transaction, the
carrying value of the goodwill previously recorded by the Company related to
the Taylor acquisition will be increased by approximately $2.5 million, which
will be amortized over the remaining useful life of the goodwill of six years.
6
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
OVERVIEW
The Company designs, develops and markets products and technology for the
control segment of the industrial automation market. The Company's broad
range of products are used to define, monitor and maintain the operation,
sequencing and safety of industrial equipment and machinery on the factory
floor. These products range from closed architecture PLC operator interfaces
to open architecture control software and systems, and are sold primarily
through an international network of independent distributors with
approximately 225 sales locations.
The Company's net sales include revenues from sales of products, software
license fees, software maintenance and services. The Company's principal
product line, QuickPanel and similar products accounted for 67% and 62% of
net sales in the three months ended June 30, 1996 and 1997, respectively.
A key element of the Company's strategy has been to expand the breadth of
products offered through its distributor network in order to maximize
operating leverage. In September 1996, the Company acquired a controlling
interest in Taylor Industrial Software ("Taylor"), an Edmonton, Alberta-based
developer of PC-control software, client/server program management software,
graphical operator interface software and PLC configuration and support
software. This acquisition expanded the Company's product line, allowing it
to capitalize on the growing trends towards interoperable technology
products, and gave the Company a platform from which to develop new products
incorporating this software technology into the Company's traditional
products.
Results of the Company's operations have fluctuated from quarter to quarter
in the past, and may fluctuate significantly in the future. Such
fluctuations may result from a variety of factors, including the timing of
new product introductions by the Company, its competitors or third parties,
the loss of any of its significant distributors, currency fluctuations,
disruption in the supply of components for the Company's products, changes in
product mix or capacity utilization, the timing of orders from major
customers, personnel changes, production delays or inefficiencies,
seasonality and other factors affecting sales and results of operations.
Such quarterly fluctuations in results of operations may adversely affect the
market price of the Company's Common Stock, no par value (the "Common
Stock"). A substantial portion of the Company's sales for each quarter
results from orders received in that quarter. Furthermore, the Company has
often recognized a substantial portion of its sales in the last month of a
quarter, with sales frequently concentrated in the last weeks or days of a
quarter. A substantial portion of the Company's operating expenses are
primarily related to personnel, development of new products, marketing
programs and facilities. The level of spending for such expenses cannot be
adjusted quickly, and is based, in large part, on the Company's expectations
of future revenues. If actual revenue levels are below management's
expectations, the Company's business, financial condition and results of
operations may be materially adversely affected. The Company believes that
period-to-period comparisons of its results of operations are not necessarily
meaningful and should not be relied upon as indicators of future performance.
The Company cautions readers that certain important factors may affect the
Company's actual results and could cause results to differ materially from
forward-looking statements which may be deemed to
7
<PAGE>
have been made in this Form 10-Q, or which are otherwise made by or on behalf
of the Company. Such factors include, but are not limited to, changing
market conditions, the availability and cost of supply materials for the
Company's products, the timely development and market acceptance of the
Company's products, and other risks detailed under the caption "Risk Factors"
in Item 1 of the Company's Annual Report on Form 10-K for the fiscal year
ended March 31, 1997, or otherwise described herein or detailed from time to
time in the Company's Securities and Exchange Commission filings.
RESULTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, 1997 AND JUNE 30, 1996
NET SALES. Net sales increased 37.6% to $12.5 million for the three month
period ended June 30, 1997 compared to $9.1 million for the three month period
ended June 30, 1996. This increase resulted primarily from the growth in sales
of the Company's graphics-based operator interface products of approximately
$1.6 million. Additionally, the increase reflects the results of Taylor for
the three months ended June 30, 1997 of approximately $1.7 million.
GROSS PROFIT. Cost of goods sold consists primarily of expenses for components
and subassemblies, subcontracted labor, direct labor and manufacturing
overhead. Gross profit increased 74.7% to $6.8 million for the three months
ended June 30, 1997 from $3.9 million for the three months ended June 30, 1996.
Gross margin increased to 54.7% for the three months ended June 30, 1997 from
43.1% for the three months ended June 30, 1996. Of this increase,
approximately 3 percentage points were attributable to a reduction in the
material cost, primarily in the QuickPanel product line, due to favorable Yen
fluctuations. Additionally, decreases in direct labor and manufacturing
overhead costs as a percentage of sales related to the integration of
Cincinnati Dynacomp Inc.'s ("Cincinnati" - acquired January 1996) operations
increased gross margin by approximately 3 percentage points. Finally, gross
margin increased by 5 percentage points due to the impact of higher gross
margin Taylor software products in the 1997 period.
SALES AND MARKETING. Sales and marketing expenses consist primarily of
personnel costs, sales commissions paid to the Company's independent sales
representatives, advertising, product literature, trade shows, distributor
promotions and depreciation on equipment used for sales related activities.
Sales and marketing expenses increased 77.0% to $3.1 million for the three
months ended June 30, 1997 from $1.7 million for the three months ended
June 30, 1996. Approximately $350,000 of the increase resulted from increased
commissions due to higher sales volume, and increased advertising and
distributor promotional programs. Approximately $870,000 of the increase
resulted from costs associated with the operations of Taylor and the remaining
increase was due to increased salary, benefits and related costs attributable
to increased sales support personnel.
RESEARCH AND DEVELOPMENT. Research and development expenses consist primarily
of personnel costs, engineering supplies, development equipment, depreciation
and overhead costs. Research and development expenses increased 81.0% to
$1.3 million for the three months ended June 30, 1997 from $695,000 for the
three months ended June 30, 1996. The increase resulted primarily from
increased salary, related benefits and employee procurement expenses due to
increases in personnel headcount, including approximately $465,000 of product
development costs related to Taylor.
8
<PAGE>
GENERAL AND ADMINISTRATIVE. General and administrative expenses consist
primarily of personnel costs related to finance, information systems, and
general management functions, as well as professional fees related to legal,
audit and tax services. General and administrative expenses increased 45.5% to
$1.2 million for the three months ended June 30, 1997 from $853,000 for the
three months ended June 30, 1996. Approximately $600,000 of the increase
related primarily to additional personnel and facility costs and goodwill
amortization resulting from the three month's operating results of Taylor,
offset by a reduction in cost resulting from the integration of Cincinnati's
operations into the Company's consolidated operations.
INTEREST EXPENSE AND OTHER, NET. Interest expense and other, net decreased to
$34,000 for the three months ended June 30, 1997 from $103,000 for the three
months ended June 30, 1996. The decrease primarily related to a decrease in
average debt outstanding as debt was repaid with a portion of the proceeds from
the Company's initial public offering in March 1997.
PROVISION FOR INCOME TAXES. Provision for income taxes increased to $535,000
for the three months ended June 30, 1997 from $218,000 for the three months
ended June 30, 1996. The effective tax rate for the three month period ended
June 30, 1997 was 42.9% as compared to the effective tax rate of approximately
40.2% for the three months ended June 30, 1996. This increase was primarily
due to non-deductible goodwill amortization.
MINORITY INTEREST IN LOSS OF SUBSIDIARY. A minority interest representing
Digital Electronic's 39.0% share of the net income or loss of Taylor is
recorded on the Company's statements of operations. The Company's ownership of
Taylor Class A Shares may increase by up to 4.0% based on the amount of
contingent consideration paid by the Company in connection with the
acquisition. To the extent the equity interest of the Company in Taylor
increases, the percentage applied to calculate minority interest will be
reduced by a corresponding amount. The minority interest benefit of $136,000
recorded for the three months ended June 30, 1997 represents the minority
interest share of the loss recorded by Taylor.
ACCRETION TO REDEMPTION VALUE OF COMMON STOCK. The Company previously issued
redeemable Common Stock and Taylor issued redeemable Taylor Exchangeable
shares. The Company recorded these redeemable shares at their estimated
redemption values at the date of issuance and subsequent changes in such
redemption value in each reporting period were accreted. The redemption
rights automatically terminated upon the closing of the Company's initial
public offering and as a result, the Company is no longer required to record
a non-cash charge in its calculation of earnings per share available to
common shareholders in the future. The accretion to redemption value of
Common Stock was $3.5 million for the three months ended June 30, 1996 and
was based on the increase in the estimated fair market value of the Common
Stock from $1.00 per share to $2.33 per share.
LIQUIDITY AND CAPITAL RESOURCES
In March 1997, the Company completed an initial public offering of its
Common Stock. Net proceeds of $11.0 million from this offering were used to
repay certain indebtedness, primarily borrowings under the Company's bank lines
of credit and certain acquisition indebtedness.
9
<PAGE>
The Company has bank lines of credit aggregating $10.0 million. The
amount that the Company is entitled to borrow under such lines of credit is
based on 80.0% to 85.0% of eligible trade accounts receivable and 50.0% of
eligible inventory, up to $4.5 million, of its respective operations. Based
on this formula, the Company would have had approximately $7.2 million and
$7.5 million of available borrowings under its line of credit at March 31 and
June 30, 1997, respectively. All funds advanced pursuant to the lines of
credit are secured by substantially all of the assets of the Company, and
such lines of credit expire in July 1998. The interest rate on borrowings
under the lines of credit is the bank's prime lending rate or LIBOR plus
1.5%, at the option of the Company or, in the case of $1.0 million of the
line of credit, the bank's prime lending rate.
Cash (used in) provided by operating activities was $(286,000) for the
three months ended June 30, 1996 and $1,839,000 for the three months ended
June 30, 1997. In 1996 the Company experienced increases in receivables and
inventory as a result of increases in the Company's sales volume, which was
partially offset by increases in accounts payable and accrued expenses. In
1997 the Company's cash flow from operations related primarily to increased
income for the period and growth in payables and accruals combined with
reductions in accounts receivable and inventory balances during the period.
Net cash used in investing activities totaled $210,000 and $403,000 for
the three months ended June 30, 1996 and 1997, respectively. These
activities consisted primarily of purchases of property and equipment.
See the Company's Annual Report on Form 10-K for a discussion of
payments of contingent consideration under the terms of the Cincinnati and
Taylor Transactions which the Company may become obligated to pay.
Management believes funds generated from operations and borrowings
available under the existing bank credit facilities or replacement facilities
will be sufficient to finance the Company's operations at least through the
end of fiscal 1998. In the event the Company acquires one or more businesses
or products, the Company's capital requirements could increase substantially,
and there can be no assurance that additional capital will be available on
terms acceptable to the Company, if at all.
10
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
In 1996, Wesco Distribution Incorporated ("Wesco"), a former distributor of
Cincinnati, initiated litigation against one of its customers, Joslyn
Sterilizer, Inc. ("Joslyn") to collect approximately $50,000 of invoices for
computer software and equipment purchased by the customer, including
equipment supplied by Cincinnati. The customer then filed a counterclaim
against Wesco alleging that the software and equipment contained defects and
seeking damages in the amount of approximately $1.6 million. On February 14,
1997, Wesco impleaded Tara Products, Inc. ("Tara"), the Company's
wholly-owned subsidiary which is the successor to Cincinnati, seeking
indemnification from Tara for damages suffered by Wesco resulting from any
product defects. This suit (the "Lawsuit") was filed in the New York Supreme
Court for Monroe County. On May 23, 1997, the New York Supreme Court for
Monroe County dismissed Wesco's third-party complaint against Tara without
prejudice on the grounds that under a distribution agreement between Wesco
and Tara's predecessor, any litigation between the two companies must be
brought in the Court of Common Pleas for Claremont County, Ohio. Wesco may
still seek indemnification from Tara in Ohio. While the Company has not
conducted any formal investigation or taken any discovery, it believes that
Tara would have a meritorious defense to such an action.
On May 7, 1997, Joslyn filed a complaint against Tara, the Company and
Tara's predecessors, Cincinnati Electrosystems Inc., and Cincinnati
Dynacomp, Inc., in the Supreme Court for Monroe County, New York, alleging
substantially the same facts against those defendants as it did against Wesco
in the counterclaim. In response to Joslyn's complaint, the defendant's filed
a motion to dismiss on July 25, 1997. Again, while this action is in the
preliminary stages and no formal discovery has been initiated, the Company
believes that it and the other defendants have meritorious defenses, and the
Company intends to vigorously defend this action. There can be no assurance,
however, that the defendants will prevail in this action. If the defendants
do not prevail, or if they settle the action, the Company could be required
to make payments to Joslyn. The Company does not, however, believe that any
such payments, if required to be made, would have a material adverse effect
on the Company's financial condition or results of operations.
The Company is not involved in any other material legal proceedings.
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
11
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a). Exhibits
Exhibit 11 - Statement regarding computation of per share earnings
Exhibit 27 - Financial Data Schedule (EDGAR version only)
(b). No report on Form 8-K was filed for the quarter ended June 30, 1997.
12
<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.
TOTAL CONTROL PRODUCTS, INC..
(Registrant)
By: /s/ Nicholas T. Gihl
------------------------------------------
Nicholas T. Gihl
Chairman and Chief Executive Officer
(Principal Executive Officer)
By: /s/ Peter A. Nicholson
------------------------------------------
Peter A. Nicholson
Senior Vice President and Chief
Financial Officer
(Principal Accounting and Financial Officer)
Date: August 8, 1997
13
<PAGE>
EXHIBIT 11
TOTAL CONTROL PRODUCTS, INC. AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER SHARE
<TABLE>
<CAPTION>
June, 30
-----------------------------
<S> <C> <C>
Computation of Net Income (Loss) per share: 1996 1997
---- ----
Net income (loss) available for common shareholders......... $ (3,137,538) $ 848,538
Interest on convertible debt, net of tax benefit............ -(a) -
------------ ------------
Net income (loss) adjusted for "as if converted"
common stock equivalents.................................. $ (3,137,538) $ 848,538
============= ============
Weighted average shares outstanding, excluding
SAB 83 shares issued...................................... 4,626,551 7,653,577
Non-SAB 83 option grants (granted prior to 12/20/95)........ -(a) 162,725
Conversion of subordinated debentures....................... -(a) -
SAB 83 shares............................................... 1,003,591 -
------------ ------------
Adjusted weighted average shares outstanding................ 5,630,142 7,816,302
============ ============
Net income (loss) per share $ (0.56) $ 0.11
============ ============
</TABLE>
(a) Not considered in earnings per share calculation as effect would be
anti-dilutive.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM TOTAL
CONTROL PRODUCTS, INC. AND SUBSIDIARIES CONSOLIDATED FINANCIAL STATEMENTS AS OF
MARCH 31 AND JUNE 30, 1997 AND FOR EACH OF THE THREE MONTHS ENDED JUNE 30, 1996
AND 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH CONSOLIDATED
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 923,144
<SECURITIES> 0
<RECEIVABLES> 7,504,713
<ALLOWANCES> (121,000)
<INVENTORY> 7,722,412
<CURRENT-ASSETS> 17,814,720
<PP&E> 3,631,151
<DEPRECIATION> (1,035,458)
<TOTAL-ASSETS> 31,922,121
<CURRENT-LIABILITIES> 7,140,708
<BONDS> 33,749
0
0
<COMMON> 24,613,624
<OTHER-SE> (3,861,566)
<TOTAL-LIABILITY-AND-EQUITY> 31,922,121
<SALES> 12,487,388
<TOTAL-REVENUES> 12,487,388
<CGS> 5,655,409
<TOTAL-COSTS> 5,655,409
<OTHER-EXPENSES> 33,933
<LOSS-PROVISION> 15,600
<INTEREST-EXPENSE> 41,830
<INCOME-PRETAX> 1,248,015
<INCOME-TAX> 535,000
<INCOME-CONTINUING> 848,538
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 848,538
<EPS-PRIMARY> .11
<EPS-DILUTED> .11
</TABLE>
