<PAGE> 1
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 December 31, 1998
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
For the transition period from ___________________to____________________
Commission file number 1-12870
COLD METAL PRODUCTS, INC.
(Exact name of registrant as specified in its charter)
NEW YORK 16-1144965
(State or other jurisdiction (I.R.S. Employer Identification
of incorporation or organization) No.)
8526 SOUTH AVENUE, YOUNGSTOWN, OHIO 44514
(Address of principal executive offices) (Zip Code)
(330) 758-1194
(Registrant's telephone number, including area code)
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 as of January 20, 1999: 6,977,250
1
<PAGE> 2
COLD METAL PRODUCTS, INC.
SEC FORM 10-Q
Quarter Ended December 31, 1998
Index
-----
<TABLE>
<CAPTION>
Page No.
<S> <C>
PART I. - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statements of Operations .......................................................... 3
Consolidated Balance Sheets .................................................................... 4
Consolidated Statements of Cash Flows .......................................................... 5
Notes to Consolidated Financial Statements ..................................................... 6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations .. 9
PART II. - OTHER INFORMATION
Item 1. Legal Proceedings .................................................................... 13
Item 2. Changes in Securities ................................................................ 13
Item 3. Defaults Upon Senior Securities ...................................................... 13
Item 4. Submission of Matters to a Vote of Securities Holders ................................ 13
Item 5. Other Information .................................................................... 13
Item 6. Exhibits and Reports on Form 8-K ..................................................... 13
Signatures ..................................................................................... 13
</TABLE>
2
<PAGE> 3
PART I: FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
COLD METAL PRODUCTS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
------------------ -----------------
December 31 December 31
----------- -----------
1998 1997 1998 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales $ 58,679 $ 67,059 $ 186,901 $ 218,985
Cost of sales 59,496 61,321 178,525 200,857
----------- ----------- ----------- -----------
Gross profit (loss) (817) 5,738 8,376 18,128
Selling, general, and administrative expenses 3,883 3,756 11,923 12,176
Impairment of long-lived assets 3,065 - 3,065 -
Interest expense 1,116 1,158 3,384 3,458
----------- ----------- ----------- -----------
Income (loss) before income taxes (8,881) 824 (9,996) 2,494
Income taxes expense (benefit) (2,490) 310 (2,953) 916
----------- ----------- ----------- -----------
Net income (loss) $ (6,391) $ 514 $ (7,043) $ 1,578
=========== =========== =========== ===========
Basic and diluted
Net income (loss) per share $ (0.91) $ 0.07 $ (1.00) $ 0.22
=========== =========== =========== ===========
Weighted average common shares outstanding 7,020,011 7,147,840 7,054,350 7,155,665
=========== =========== =========== ===========
</TABLE>
See notes to consolidated financial statements.
3
<PAGE> 4
COLD METAL PRODUCTS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS, EXCEPT SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
December 31, March 31,
------------ ---------
1998 1998
---- ----
<S> <C> <C>
Assets:
Cash $ 194 $ 1,140
Receivables 25,803 35,996
Inventories 43,865 53,703
Prepaid and other current assets 2,142 3,134
--------- ---------
Total current assets 72,004 93,973
Property, plant and equipment - at cost 80,535 80,583
Less accumulated depreciation (35,093) (33,203)
--------- ---------
Property, plant and equipment - net 45,442 47,380
Other assets 11,508 9,028
--------- ---------
Total assets $ 128,954 $ 150,381
========= =========
Liabilities and shareholders' equity:
Short-term debt $ 1,471 $ 2,736
Accounts payable 21,204 26,467
Other current liabilities 8,740 7,997
--------- ---------
Total current liabilities 31,415 37,200
Long-term debt 56,710 60,859
Postretirement benefits 16,055 16,613
Shareholders' equity:
Common stock, $.01 par value; 15,000,000 shares
authorized, 7,532,250 shares issued 75 75
Additional paid-in capital 25,360 25,350
Retained earnings 11,204 18,245
Accumulated other comprehensive income (7,688) (4,034)
Less treasury stock, 538,000 and 438,000 shares, at cost (4,177) (3,927)
--------- ---------
Total shareholders' equity 24,774 35,709
--------- ---------
Total liabilities and shareholders' equity $ 128,954 $ 150,381
========= =========
</TABLE>
See notes to consolidated financial statements
4
<PAGE> 5
COLD METAL PRODUCTS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended
-----------------
December 31,
------------
1998 1997
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (7,043) $ 1,578
Adjustments to reconcile net income to cash
provided by (used in) operating activities:
Depreciation and amortization 3,317 3,524
Impairment of long-lived assets 3,065 ---
Deferred directors' fees 10 20
Deferred income taxes (1,343) ---
Changes in operating assets and liabilities:
Accounts receivable 8,906 8,295
Inventory 8,077 (8,371)
Accounts payable (5,158) (1,172)
Accrued expense and other (1,319) (2,641)
--------- ---------
Net cash provided by operating activities 8,512 1,233
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant and equipment (4,217) (2,521)
--------- ---------
Net cash used in investing activities (4,217) (2,521)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments of term loans (1,022) (1,123)
Proceeds from debt 119,572 165,677
Payments of debt (123,508) (163,107)
Treasury stock acquisition (249) (127)
--------- ---------
Net cash (used) provided by financing activities (5,207) 1,320
Net increase (decrease) in cash (912) 32
Effect of translation adjustment (34) (20)
Cash at beginning of period 1,140 898
--------- ---------
Cash at end of period $ 194 $ 910
========= =========
</TABLE>
See notes to consolidated financial statements.
5
<PAGE> 6
COLD METAL PRODUCTS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1. OPINION OF MANAGEMENT
In the opinion of management, the accompanying unaudited consolidated financial
statements contain all adjustments, consisting of normal recurring accruals,
necessary to present fairly the financial position of Cold Metal Products, Inc.
(the Company) as of December 31, 1998 and March 31, 1998, the results of
operations for the three month and nine month periods ended December 31, 1998
and 1997, and changes in cash flows for the nine months ended December 31, 1998
and 1997. The results of operations for the periods ended December 31, 1998 and
1997 are not necessarily indicative of the results to be expected for the full
year.
The condensed consolidated financial statements do not include footnotes and
certain financial information normally presented annually under generally
accepted accounting principles and, therefore, should be read in conjunction
with the audited consolidated financial statements contained in the Company's
annual report on Form 10-K for the year ended March 31, 1998.
NOTE 2. RESULTS OF FOREIGN OPERATIONS
Net sales, pretax income (loss), and net income (loss), respectively, of the
Company's Canadian subsidiary were $29.6 million, $(6.9) million, and $(5.1)
million for the quarter ended December 31, 1998, and $36.6 million, $335,000,
and $211,000 for the quarter ended December 31, 1997. Comparable net sales,
pretax income (loss), and net income (loss), respectively, for the nine months
ended December 31, 1998 were $92.8 million, $(8.0) million, and $(5.9) million,
and for the nine months ended December 31, 1997 were $123.1 million, $3.1
million, and $2.0 million.
NOTE 3. PER SHARE CALCULATIONS
Primary earnings per common share have been computed based upon the average
weighted outstanding shares of 7,020,011 for the three month period ended
December 31, 1998 and 7,054,840 for the nine month period ended December 31,
1998. Primary earnings per common share have been computed based upon the
average weighted outstanding shares of 7,147,840 for the three month period
ended December 31, 1997 and 7,155,665 for the nine month period ended December
31, 1997. Basic and dilutive earnings per share amounts are the same as the
effect of dilutive outstanding stock options is immaterial.
NOTE 4. SPECIAL CHARGES
As a result of continued operating losses experienced at one of the Company's
Canadian service center locations and the Company's projection that
undiscounted future cash flows of the assets of that facility were less than
the carrying amounts of those assets, the Company recognized a pretax goodwill,
machinery and equipment impairment charge of $3.1 million in the quarter ended
December 31, 1998. The affected machinery and equipment have been adjusted to
their estimated fair market value of $1.1 million and reclassified as assets
held for sale under other assets.
6
<PAGE> 7
In addition, certain non-Lifo inventory in Canada was written down to estimated
net realizable value at December 31, 1998. Results of operations for the quarter
and year to date periods ended December 31, 1998 included a pre-tax charge of
$2.7 million which represented excess cost over market.
In January 1999, the company initiated a restructuring plan to align its
operations with current market conditions, improve the productivity of its
operations, and create a more efficient organizational structure. The Company
anticipates a fourth quarter pre-tax charge of $10 to $13 million to provide
for remaining costs in connection with this plan. The Company projects that
implementation of the plan will be substantially completed by the end of
September 1999.
NOTE 5. INVENTORIES
Inventories are classified as follows:
<TABLE>
<CAPTION>
December 31, March 31,
------------ ---------
1998 1998
---- ----
(In thousands)
<S> <C> <C>
Raw Materials $23,622 $28,241
Work-in-process 11,645 14,978
Finished goods 8,598 10,484
------------------ ------------------
Total inventories $43,865 $53,703
================== ==================
</TABLE>
NOTE 6. SHORT-TERM AND LONG-TERM DEBT
As of December 31, 1998, short term and long term debt included $19.2 million of
borrowings under a term loan secured by assets of the expanded Ottawa facility.
The term loan agreement contains customary restrictions concerning various
financial ratios. At period end, the Company was in violation with respect to a
cash flow covenant. The lender has waived the instance of noncompliance through
the period ending December 31, 1999.
As of December 31, 1998, long term debt included $39.0 million of borrowings
under a committed credit facility collateralized by accounts receivable,
inventory, common stock of the Canadian subsidiary, and property, plant and
equipment. The agreement contains certain financial covenants. At December 31,
1998 the Company was in violation of a cash flow covenant which the lender has
agreed to waive as of December 31, 1998 and to amend for future periods,
providing for borrowing at Libor plus 150 basis points, with scheduled
reductions upon achievement of certain performance goals, and extending the term
through October 2002.
NOTE 7. DIRECTORS' INCENTIVE PLAN
In accordance with the Non-Employee Directors' Incentive Plan, one director has
elected to defer receipt of shares of stock in lieu of pay for his annual
retainer fee. As of December 31, 1998, 14,483 shares of the 60,000 shares
reserved under the Plan for such deferral elections, were committed to be issued
at the end of the deferment period, which is a specified period after the
Director's resignation or certain other events, such as a sale or merger of the
Company.
7
<PAGE> 8
NOTE 8. COMMON STOCK
Under a stock repurchase program authorized by the Company's Board of Directors,
the Company purchased 80,000 shares of treasury stock in the nine month period
ended December 31, 1998 for a total of $249,000. Current financing agreements
allow for the repurchase of stock not to exceed an aggregate amount of $3.0
million. The aggregate amount purchased by the Company under the program through
December 31, 1998 totals $1,296,000.
On January 4, 1999, the Company purchased 208,050 shares of its own common stock
from a former officer of the Company at $4.44 per share in accordance with a
retirement agreement. The Company recorded a $274,000 charge in the three month
period ended December 31, 1998 in connection with this transaction.
NOTE 9. CONTINGENCIES
In July 1998, the Company negotiated a settlement in connection with a court
awarded verdict against the Company involving an injured employee. The
settlement had no significant impact on the Company's statement of operations
for the nine months ended December 31, 1998, or the consolidated financial
position as of December 31, 1998.
NOTE 10. COMPREHENSIVE INCOME
Effective April 1, 1998, the Company adopted Statement of Financial Accounting
Standards (SFAS) No. 130, "Reporting Comprehensive Income." SFAS No. 130
establishes new standards for reporting comprehensive income and its components.
Comprehensive income is a measurement of all changes in shareholders' equity
that result from transactions and other economic events other than transactions
with shareholders.
Consolidated statement of comprehensive income are as follows:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
------------------ -----------------
December 31, 1998 December 31, 1998
----------------- -----------------
(In thousands)
1998 1997 1998 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net income (loss) $(6,391) $ 514 $ (7,043) $ 1,578
Other comprehensive income, (loss) net of tax:
Foreign currency translation adjustments (439) (58) (3,654) (1,648)
---------------------------------------------------
Comprehensive income (loss) $(6,830) $(456) $ (10,697) $ (70)
===================================================
</TABLE>
8
<PAGE> 9
ITEM 2.
COLD METAL PRODUCTS, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following is management's discussion and analysis of financial
condition and results of operations during the periods included in the
accompanying consolidated financial statements and should be read in conjunction
with the annual financial statements.
Results of Operations
- ---------------------
The following table presents the Company's results of operations as a
percentage of net sales:
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
DECEMBER 31, DECEMBER 31,
1998 1997 1998 1997
<S> <C> <C> <C> <C>
Net sales 100.0% 100.0% 100.0% 100.0%
Cost of sales 101.4% 91.4% 95.5% 91.7%
-------------------------------------------------------------------------
Gross profit (loss) -1.4% 8.6% 4.5% 8.3%
Selling, general, and administrative
expenses 6.6% 5.6% 6.4% 5.6%
Impairment of long-lived assets 5.2% -- 1.7% --
Interest expense 1.9% 1.7% 1.8% 1.6%
-------------------------------------------------------------------------
Income (loss) before income taxes -15.1% 1.3% -5.4% 1.1%
Income taxes (benefit) expense -4.2% 0.5% -1.6% 0.4%
-------------------------------------------------------------------------
Net income (loss) -10.9% 0.8% -3.8% 0.7%
=========================================================================
</TABLE>
Net sales for the three months ended December 31, 1998 were $58.7
million, representing an $8.4 million or 12.5% decrease from the three months
ended December 31, 1997. The decrease in sales is attributable mainly to a 7.1%
decrease in tons shipped, accounting for $4.7 million of the sales decrease.
Lower Canadian exchange rates impacted the comparison by $2.5 million while
lower revenue per ton accounted for $1.0 million of sales decrease. Lower
customer requirements resulted as automotive accounts continued their inventory
level corrections and low priced imports displaced Company market share and
depressed selling prices. Somewhat offsetting these negative effects was an
increase in sales at the expanded Ottawa facility.
For the nine months ended December 31, 1998, net sales of $186.9
million were down $32.1 million from the $219.0 million of the prior year
period. As was the case for the three months ended December 31, 1998, the
decrease was mainly attributable to lower volumes resulting from the effects of
the General Motors work stoppage and subsequent automotive inventory
corrections, the impact of the Asian financial crisis, the import situation,
and the effect of a lower Canadian exchange rate. Improved shipments from the
Ottawa facility somewhat offset these effects.
9
<PAGE> 10
Gross profit for the three months ended December 31, 1998 was
$(817,000), which reflected a special charge of $2.7 million to write-down
inventory in Canada. Gross profit for the quarter before this adjustment was
$1.9 million or 3.2% of net sales, which was a decrease of $3.9 million over the
three months ended December 31, 1997. This decrease in margins before special
charges is attributable to the low volume levels which created underutilization
conditions in operations. Spreading the fixed operating costs over lower unit
volumes had a significant impact on gross margins. Additionally, an increased
mix of lower margin products affected the margin comparison.
Gross profit for the nine months ended December 31, 1998 was $8.4
million or 4.5% of net sales compared to $18.1 million or 8.3% of net sales for
the nine months ended December 31, 1997. The decrease in margins is a direct
result of the special inventory charge, lower volumes and margins described
above.
Selling, general and administrative costs of $3.9 million for the three
months ended December 31, 1998 represented 6.6% of sales; selling, general and
administrative costs for the three months ended December 31, 1997 were $3.8
million, or 5.6% of net sales. Expense in the current year period reflected a
special charge of $274,000 related to the former chief executive officer's
retirement agreement, which was offset by lower accrued compensation costs
related to incentive compensation programs, as well as effects from lower
Canadian exchange rates.
For the nine month period ended December 31, 1998, selling, general and
administrative costs were $11.9 million, or 6.4% of net sales, compared to $12.2
million, or 5.6% of net sales for the nine months ended December 31, 1997.
Current year activity includes $1.0 million of special charges related to the
former chief executive officer's retirement agreement, lower costs related to
incentive compensation programs and effects from lower Canadian exchange rates.
For the three month period ended December 31, 1998, the Company
recorded a charge of $3.1 million to recognize the impairment of goodwill,
machinery and equipment at the Direct Steel Service Center facility in Canada.
In January 1999, the Company's board authorized a restuctuing plan and the
Company anticipates a pre-tax charge of $10 to $13 million in the quarter
ending March 31, 1999 to provide for the restructuring plan. Included in this
additional charge would be severance payments, pension and post-retirement
charges and other costs necessary to accomplish the cost-saving initiatives of
the restructuring plan. The four initiatives of the restructuring include
streamlining central management staff and decentralizing company operations
through the creation of separate business units, designed for flexibility,
responsiveness and efficiency; combining the Indianapolis and Ottawa operations
under one management team to attain more cost-effective production; reassessing
the strategic fit of two unprofitable service centers in Ontario, Canada; and
reducing the overall workforce by up to 25 percent. In total, the restructuring
plan is estimated to result in a pre-tax cost savings of $5 million to $7
million annually, beginning with fiscal year 2000. The goal of the
restructuring is to build upon the fundamental strengths of the organization,
create a platform for growth, and return the Company to a respectable level of
profitability.
Interest expense was $1.1 million, or 1.9% of net sales for the three
months ended December 31, 1998 and was almost unchanged as compared to $1.2
million or 1.7% of net sales for the three months ended December 31, 1997. For
the nine months ended December 31, 1998, interest expense was $3.4 million, or
1.8% of net sales, relatively unchanged in total compared to $3.5 million, or
1.6% of net sales for the nine month period ended December 31, 1997.
Income (loss) before taxes was $(8.9) million, or (15.1)% of net sales
for the three months ended December 31, 1998. For the three months ended
December 31, 1997, income before taxes was
10
<PAGE> 11
$824,000, or 1.3% of net sales. For the nine months ended December 31, 1998,
income (loss) before taxes was $(10.0) million, or (5.4)% of net sales, compared
with $2.5 million, or 1.1% of net sales for the nine months ended December 31,
1997.
Income tax benefit for the three months ended December 31, 1998 was
$(2.5) million, or (4.2)% of net sales compared to expense of $310,000, or .5%
of net sales for the same period ended December 31, 1997. Tax (benefit) expense
for the nine months ended December 31, 1998 was $(3.0) million, or (1.6)% of net
sales, compared to $916,000, or .4% of net sales for the nine months ended
December 31, 1997. The effective tax rate for the three month and nine month
periods ended December 31, 1998 reflected the effect of a permanent difference
for the goodwill impairment charge taken in the quarter ended December 31, 1998.
Net loss for the three months ended December 31, 1998 was $(6.4)
million, or $(.91) per share as compared to net income of $514,000, or $.08 per
share for the three months ended December 31, 1997. Net loss for the nine months
ended December 31, 1998 was $(7.0) million or $(1.00) per share compared to net
income of $1.6 million or $.22 per share for the nine months ended December 31,
1997.
Liquidity and Capital Resources
- -------------------------------
During the nine months ended December 31, 1998, operating activities
provided $8.6 million in cash, compared to cash provided of $1.2 million for the
nine months ended December 31, 1997. Cash provided by operations was the result
of lower accounts receivables and inventory level reductions, somewhat offset by
accounts payable and accrued expense increases.
Cash used in investing activities was $4.2 million for the nine months
ended December 31, 1998, reflecting spending for capital projects during the
period. This represented a 67% increase in investing over the prior year's nine
month period.
Cash flows from financing activities consumed $5.2 million for the nine
months ended December 31, 1998. The Company's two bank lending arrangements
provided a maximum borrowing availability of approximately $89.2 million of
which $58.2 million was outstanding at December 31, 1998. As of December 31,
1998, the Company was in violation of certain cash flow covenants under both
lending agreements. The lender of the Company's term loan has waived the
instance of noncompliance through the period ending December 31, 1999. The
lender under the Company's committed facility has agreed to waive the
noncompliance as of December 31, 1998 and to amend for future periods, providing
for borrowing at Libor plus 150 basis points, with scheduled reductions upon
achievement of certain performance goals, and extending the term through October
2002.
Management expects that cash generated from operating activities and
the Company's borrowing capacity will be sufficient to meet planned capital
expenditure needs, cash requirements of the restructuring plan and other cash
requirements for the next twelve months.
Year 2000
- ---------
In Year 2000, certain computer programs may recognize a date using "00"
as the year 1900 rather than the year 2000. The Company must determine whether
its systems are capable of recognizing and handling date information accurately
and without interruption before, during and after January 1, 2000.
11
<PAGE> 12
Most of the Company's critical information technology systems have been
modified, tested, and/or certified from vendors as being Year 2000 compliant.
Other non-information technology systems have been inventoried, tested or
certified in accordance with a compliance plan.
The Company has initiated a formal inquiry process with its suppliers
and vendors with which the Company has significant relationships to evaluate the
extent to which the Company is vulnerable to third party failure to remedy Year
2000 problems. The Company continues to evaluate replies as it receives them and
is working with the third parties to correct those problems or monitoring their
efforts to acheive compliance. The Company has received replies from many of its
significant suppliers and vendors.
The Company estimates that the total cost of achieving Year 2000
compliance for its internal systems and equipment is less than $150,000, of
which only a nominal amount remains to be spent. Most of the cost to date has
been funded by allocation of existing resources rather than incurring
incremental costs. The Company expects to continue to fund any remaining costs
by allocation of existing resources.
Based on assessment of its major information technology and
non-information technology systems, the Company believes that all necessary
modifications and testing will be completed in a timely manner to insure that
the Company is Year 2000 compliant. While the Company is verifying the readiness
of its major suppliers and vendors, there is no assurance that all third parties
on which the Company relies will be Year 2000 compliant in a timely manner. The
worst case scenario for the Company would involve general failure of
infrastructure systems such as electrical power. While the Company will continue
to develop contingency plans intended to allow the Company to move production
among its various facilities, substitute alternate suppliers, or reduce or
suspend operations in the case of a major infrastructure failure, the resulting
disruption could have a material adverse effect on the Company's business or
consolidated financial statements.
Forward-Looking Information
- ---------------------------
This document contains various forward-looking statements and
information that are based on management's beliefs as well as assumptions made
by and information currently available to management. When used in this
document, the words "expect", "believe", anticipate," "plan" and similar
expressions are intended to identify forward-looking statements, which are made
pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Because such statements include risks and uncertainties,
actual results may differ materially from those expressed or implied by such
forward looking statements. Factors that could cause actual results to differ
materially from those expressed or implied by such forward-looking statements
include, but are not limited to, general business and economic conditions,
competitive factors such as availability and pricing of steel, changes in
customer demand, work stoppages by customers, potential equipment malfunctions,
Year 2000 problems, or other risks and uncertainties discussed in the Company's
10K report.
12
<PAGE> 13
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is not involved in any legal proceedings which are material
to its financial position.
ITEM 2. CHANGE IN SECURITIES
There have been no changes in securities.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Note 6 to the Financial Statements included as Item 1 of Part I of
this Report is incorporated by reference as Item 3 of this Part II.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no submission of matters to a vote of security holders.
ITEM 5. OTHER INFORMATION
There is no other information to report.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibit Number and Description
(27) Financial Data Schedule
(b) Reports on Form 8-K - None
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.
Cold Metal Products, Inc.
(Registrant)
/s/ Raymond P. Torok
------------------------------------
Raymond P. Torok
President, Chief Executive Officer
/s/ John E. Sloe
------------------------------------
John E. Sloe
Vice-President, Chief Financial Officer
(Principal Financial and Accounting Officer)
February 16, 1999
13
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1999
<PERIOD-START> APR-01-1998
<PERIOD-END> DEC-31-1998
<CASH> 194
<SECURITIES> 0
<RECEIVABLES> 25,803
<ALLOWANCES> 565
<INVENTORY> 43,865
<CURRENT-ASSETS> 72,004
<PP&E> 80,535
<DEPRECIATION> 35,093
<TOTAL-ASSETS> 128,954
<CURRENT-LIABILITIES> 31,415
<BONDS> 0
0
0
<COMMON> 75
<OTHER-SE> 24,699
<TOTAL-LIABILITY-AND-EQUITY> 128,954
<SALES> 58,679
<TOTAL-REVENUES> 58,679
<CGS> 59,496
<TOTAL-COSTS> 59,496
<OTHER-EXPENSES> 6,948
<LOSS-PROVISION> 30
<INTEREST-EXPENSE> 1,116
<INCOME-PRETAX> (8,881)
<INCOME-TAX> (2,490)
<INCOME-CONTINUING> (6,391)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (6,391)
<EPS-PRIMARY> (.91)
<EPS-DILUTED> (.91)
</TABLE>
