SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
November 5, 1998 (November 4, 1998)
Date of Report (Date of earliest event reported)
DT INDUSTRIES, INC.
(Exact name of registrant as specified in charter)
DELAWARE
(State or other jurisdiction of incorporation)
0-23400 44-0537828
(Commission File Number) (I.R.S. Employer Identification Number)
1949 East Sunshine, Suite 2-300
Springfield, MO 65804
(Address of principal executive offices)
(Zip code)
(417) 890-0102
(Registrant's telephone number, including area code)
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ITEM 5. OTHER EVENTS
On November 4, 1998, the Company released a report of its earnings for the three
month period ended September 27, 1998.
Statements contained in the attached press release that are not historical facts
are forward-looking statements that are subject to the safe harbor provisions of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. References to "expectations,"
"opportunities," "potential" and "goals" in the attached press release indicate
such forward-looking statements. Actual results could differ materially from
those anticipated in any forward-looking statements as a result of various
factors, including economic downturns in industries served, delays or
cancellations of customer orders, delays in shipping dates of products,
significant cost overruns on certain projects, foreign currency exchange rate
fluctuations and delays in achieving anticipated cost savings or in effectively
correcting production inefficiencies and capacity issues and expanding into
additional markets and possible future acquisitions that may not be
complementary or additive.
ITEM 7. FINANCIAL STATEMENTS, PROFORMA FINANCIAL INFORMATION AND EXHIBITS
(a) Press release of the Company dated November 4, 1998.
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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 hereunto duly authorized.
DT INDUSTRIES, INC.
Date: November 5, 1998 by: /s/ Bruce P. Erdel
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Bruce P. Erdel
Senior Vice President - Finance
and Administration
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EXHIBIT INDEX
Page no. in
Sequential
Exhibit No. Description Numbering System
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99 Press Release of the
Company dated
November 4, 1998.
DT Industries, Inc.
1949 E. Sunshine
Suite 2-300
Springfield, MO 65804
Nasdaq: DTII
At the Company: At The Financial Relations Board:
Bruce P. Erdel Karl Plath Bill Schmidle
Vice President, Finance General Information Analyst Contact
417/890-0102 312/640-6738 312/640-6753
FOR IMMEDIATE RELEASE
DT INDUSTRIES REPORTS 1ST-QTR NET INCOME $3.8 MILLION,
DILUTED EPS OF 37 CENTS
SPRINGFIELD, Mo., November 4, 1998--DT Industries, Inc. (Nasdaq: DTII) today
reported first-quarter net income of $3.8 million, or 37 cents per share on a
diluted basis, compared with $6.5 million, or 53 cents per diluted share, before
an extraordinary loss related to debt refinancing in the prior year. After the
extraordinary loss, net income reported for last year's first quarter ended
September 28, 1997, was $5.3 million, or 44 cents per diluted share.
Net sales for the quarter ended September 27, 1998, decreased 2.5 percent
to $112.9 million compared with $115.8 million for the prior-year quarter.
First-quarter orders totaled $93.7 million, contributing to a backlog of $206.2
million at September 27, 1998, compared with $241.1 million the prior year.
EXPECTS IMPROVEMENTS IN SECOND HALF
"Our orders continue to remain at significantly lower levels than we had
planned, particularly in the automation group," said Stephen J. Gore, president
and chief executive officer. "Overall, we have seen softness in orders from the
automotive, medical device and food packaging industries. That has been largely
attributable to product development issues among our customers and, to a lesser
extent, their reluctance to place orders due to caution over the global economic
situation. Several significant projects are being delayed into the second and
third quarters, but we do not
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believe these are lost opportunities. Through October, however, we have not seen
an overall increase in orders. Additionally, our components group has
experienced softness in sales to customers serving the agricultural equipment
industry, which is expected to continue at least through the end of the fiscal
year.
"Last quarter we reported that we expected the softness in backlog and
orders noted at that time to be reflected in results of the first two quarters
of fiscal 1999," Gore said. "Given the unexpectedly lower level of first-quarter
orders, we now project the second quarter to show modest improvement in sales
over the first quarter. We remain cautiously optimistic that strong order
prospects in the coming months will lead to significantly improved operating
results in the second half, however, it is too early to project the outcome with
certainty, and there remains a possibility of continued timing issues with
orders."
INTERNAL IMPROVEMENTS TARGETED
Gore also noted that management is examining all planned expenditures with
an eye on controlling spending and will defer capital expenditures except where
necessary for current operations. Additionally, he said, project cost overruns
and other operating issues identified at some facilities are being analyzed and
appropriate steps will be taken to correct them.
AUTOMATION GROUP SALES INCREASE
Automation group sales during the first quarter increased by $2.7 million,
reflecting incremental sales increases resulting from the ATT acquisition in
July 1997, the addition of new customers serving the electronics, medical
products and food packaging industries, and increased sales to the tire
industry. These increases were offset in part by a significant decrease in sales
to a large electronics customer and lower sales to the automotive industry. Gore
said the company expects order activity by customers in the automotive industry
to strengthen over the next three to four months as well as increased activity
from the large electronics customer. Mid-West Automation continues to identify
new opportunities to diversify its customer base following softness experienced
with a significant customer during the past year.
PACKAGING GROUP SALES LOWER
Largely the result of lower sales of plastics processing equipment, sales
in the packaging group decreased $2.5 million compared with the prior year.
Sales were relatively flat for other packaging equipment. Gore said there are
strong opportunities for thermoforming equipment but that foam-extrusion product
sales are being affected by general economic conditions and over capacity in
South America. Strong order activity was reported from the pharmaceutical and
nutritional industries.
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COMPONENT GROUP SALES REFLECT KNITTING ELEMENTS DIVESTITURE
The components group reported first-quarter sales decreased by $3.1
million, primarily the result of the May 1998 divestiture of the non-core
Knitting Elements division. Also affecting components group results were the
loss of certain customers through planned attrition, product changes by
customers and decreased sales to the agricultural equipment industry.
MARGIN IMPROVEMENTS TARGETED
First-quarter gross profit decreased $2.7 million, or 8.7 percent, to $28.2
million from $30.9 million. As a percent of sales, gross profit decreased to
25.0 percent from 26.7 percent, in part the result of significantly lower gross
margins on plastics processing equipment and unexpected cost overruns on certain
contracts for assembly and welding equipment. Components group margins were
lower as a result of the divestiture of the higher-margin Knitting Elements
business, lower sales volume and a mix issue with continuing business. These
unfavorable variances were partially offset by continuing margin improvements at
ATT.
"For those facilities where production issues have surfaced, we are
thoroughly analyzing the circumstances and continue to develop and implement
appropriate action plans to correct deficiencies," Gore said.
First-quarter operating expenses increased 9.9 percent to $18.8 million
from $17.1 million, primarily the result of incremental expenses associated with
the ATT acquisition. Spending during the first quarter was lower than planned,
primarily resulting from the deferral of expenditures for certain research and
development and sales and marketing activities as well as deferral of workforce
additions.
Operating profit decreased 31.7 percent to $9.4 million from $13.8 million.
Interest expense increased 21.6 percent to $2.0 million from $1.7 million,
primarily because of increased debt resulting from acquisitions and share
repurchases.
CONTINUED FOCUS ON IMPROVEMENTS
"Our customer base remains strong, and we believe improvements in key
markets and our own internal initiatives will lead to significant improvements
beginning later in fiscal 1999," Gore said. "We recognize the challenges facing
us in the year ahead, and we continue to focus on correcting operational issues,
generating new business and improving the efficiency of our service to existing
customers," Gore said. "Our goals remain unchanged: diversified end-user
markets, strategically advantageous acquisitions and additional strategic
alliances with Fortune 500 companies."
DT Industries, Inc. is a leading designer, manufacturer and integrator of
automated production systems used to assemble, test or package industrial and
consumer
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products. The company also produces precision metal components, tools and dies
for a broad range of industrial applications.
Certain statements included herein that are not historical, particularly
statements about the company's expectations or beliefs, are forward-looking
statements. The company's actual results for current or future periods could
differ materially from the expected results because of a variety of factors,
including economic downturns in industries served, delays or cancellations of
customer orders, delays in shipping dates of products, cost overruns on certain
projects, currency exchange fluctuations and other factors described in the
company's filings with the U.S. Securities and Exchange Commission.
Financial tables follow....
For further information on DT Industries by fax, at no cost,
dial 1-800- PRO-INFO and use ticker symbol "DTII."
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DT INDUSTRIES, INC.
Consolidated Statement of Operations
(Dollars in thousands, except per share data)
Three months ended
September 27, September 28,
1998 1997
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Net sales $ 112,907 $ 115,764
Cost of sales 84,682 84,856
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Gross profit 28,225 30,908
Selling, general and
administrative expenses 18,781 17,089
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Operating Income 9,444 13,819
Interest expense 2,036 1,674
Dividends on company-obligated,
mandatorily redeemable convertible
preferred securities of subsidiary
DT Capital Trust holding solely
convertible junior subordinated
debentures of the Company, at
7.16% per annum 1,253 1,253
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Income before provision for income
taxes and extraordinary loss 6,155 10,892
Provision for income taxes 2,370 4,357
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Income before extraordinary loss 3,785 6,535
Extraordinary loss on debt
refinancing less applicable income
tax benefit of $800 - 1,200
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Net Income $ 3,785 $ 5,335
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Basic earnings per common share:
Income before extraordinary loss $ 0.37 $ 0.58
Extraordinary loss - 0.11
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Net income $ 0.37 $ 0.47
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Diluted earnings per common share:
Income before extraordinary loss $ 0.37 $ 0.53
Extraordinary loss - 0.09
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Net income $ 0.37 $ 0.44
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Weighted average number of common
shares outstanding:
Basic 10,318,053 11,301,875
Diluted 12,413,389 13,672,486
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DT INDUSTRIES, INC.
Consolidated Balance Sheets
(Dollars in thousands, except per share data)
September 27, June 28,
1998 1998
(Unaudited)
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Assets
Current assets:
Cash and cash equivalents $ 8,711 $ 6,915
Accounts receivable, net 80,834 75,634
Costs and estimated earnings in excess
of amounts billed on uncompleted
contracts 73,239 66,910
Inventories, net 53,998 48,755
Prepaid expenses and other 7,886 8,931
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Total current assets 224,668 207,145
Property, plant and equipment, net 74,800 69,183
Goodwill, net 181,935 177,578
Other assets, net 5,331 6,096
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$ 486,734 $ 460,002
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Liabilities and Stockholders' Equity
Current liabilities:
Current portion of long-term debt $ 321 $ 55
Accounts payable 33,398 33,627
Customer advances 28,290 21,791
Accrued liabilities 40,917 43,232
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Total current liabilities 102,926 98,705
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Long-term debt 119,433 89,956
Deferred income taxes 7,807 7,827
Other long-term liabilities 3,581 3,455
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Total long-term liabilities 130,821 101,238
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Commitments and contingencies
Company-obligated, mandatorily redeemable
convertible preferred securities of
subsidiary DT Capital Trust holding solely
convertible junior subordinated
debentures of the Company 70,000 70,000
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Stockholders' equity:
Preferred stock, $0.01 par value;
1,500,000 shares authorized;
no shares issued and outstanding
Common stock, $0.01 par value;
100,000,000 shares authorized;
9,996,437 and 10,502,762 shares
issued and outstanding at September 27,
1998 and June 28,1998, respectively 113 113
Additional paid-in capital 134,652 134,608
Retained earnings 84,138 80,561
Cumulative translation adjustment (1,781) (778)
Less-
Treasury stock, at cost (1,382,700 shares)
(34,135) (24,445)
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Total stockholders' equity 182,987 190,059
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$ 486,734 $ 460,002
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