UNITED STATES
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: March 31, 1999
--------------
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: 0-23804
-------
Simpson Manufacturing Co., Inc.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
California 94-3196943
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4637 Chabot Drive, Suite 200, Pleasanton, CA 94588
------------------------------------------------------
(Address of principal executive offices)
(Registrant's telephone number, including area code): (925)460-9912
------------
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
--- ---
The number of shares of the Registrant's Common Stock outstanding as of
March 31, 1999: 11,585,502
----------
<PAGE>
PART I -- FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
SIMPSON MANUFACTURING CO., INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
----------------------------
(Unaudited)
1999 1998 1998
------------ ------------ ------------
<S> <C> <C> <C>
ASSETS
Current assets
Cash and cash equivalents $ 33,642,222 $ 16,248,992 $ 37,402,450
Trade accounts receivable, net 44,724,610 34,420,498 34,089,122
Inventories 59,564,149 56,766,526 56,340,053
Deferred income taxes 4,046,027 3,559,493 3,749,599
Other current assets 1,713,334 1,654,769 1,282,814
------------ ------------ ------------
Total current assets 143,690,342 112,650,278 132,864,038
Net property, plant and equipment 56,557,645 46,391,960 54,964,704
Investments 514,155 548,391 524,964
Other noncurrent assets 3,048,198 2,955,917 3,246,045
------------ ------------ ------------
Total assets $203,810,340 $162,546,546 $191,599,751
============ ============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Notes Payable and current
portion of long-term debt $ 327,477 $ 29,147 $ 330,704
Trade accounts payable 12,371,463 12,793,780 11,761,237
Accrued liabilities 5,223,706 4,352,965 5,591,292
Income taxes payable 5,356,866 2,293,672 1,465,384
Accrued profit sharing trust
contributions 4,128,707 3,812,841 3,173,362
Accrued cash profit sharing
and commissions 3,732,724 2,434,539 4,019,806
Accrued workers' compensation 879,272 659,272 879,272
------------ ------------ ------------
Total current liabilities 32,020,215 26,376,216 27,221,057
Long-term debt, net of current portion 2,557,020 - 2,565,182
Deferred income taxes and
long-term liabilities 434,607 741,918 531,149
------------ ------------ ------------
Total liabilities 35,011,842 27,118,134 30,317,388
------------ ------------ ------------
Commitments and contingencies (Notes 5 and 6)
Shareholders' equity
Common stock 33,871,198 33,110,912 33,723,845
Retained earnings 135,638,611 102,509,459 127,990,208
Accumulated other comprehensive income (711,311) (191,959) (431,690)
------------ ------------ ------------
Total shareholders' equity 168,798,498 135,428,412 161,282,363
------------ ------------ ------------
Total liabilities and
shareholders' equity $203,810,340 $162,546,546 $191,599,751
============ ============ ============
</TABLE>
The accompanying notes are an integral part of these
condensed consolidated financial statements.
<PAGE>
SIMPSON MANUFACTURING CO., INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMNETS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
----------------------------
1999 1998
------------ ------------
<S> <C> <C>
Net sales $ 74,661,590 $ 59,254,549
Cost of sales 46,212,976 37,381,156
------------ ------------
Gross profit 28,448,614 21,873,393
------------ ------------
Operating expenses:
Selling 7,897,807 5,624,774
General and administrative 8,038,761 6,864,496
Compensation related to stock plans 83,000 57,000
------------ ------------
16,019,568 12,546,270
------------ ------------
Income from operations 12,429,046 9,327,123
Interest income, net 348,357 206,652
------------ ------------
Income before income taxes 12,777,403 9,533,775
Provision for income taxes 5,129,000 3,873,000
------------ ------------
Net income $ 7,648,403 $ 5,660,775
============ ============
Net income per common share
Basic $ 0.66 $ 0.49
Diluted $ 0.63 $ 0.47
Number of shares outstanding
Basic 11,580,828 11,531,115
Diluted 12,093,225 12,044,490
</TABLE>
SIMPSON MANUFACTURING CO., INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMNETS OF COMPREHENSIVE INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
----------------------------
1999 1998
------------ ------------
<S> <C> <C>
Net income $ 7,648,403 $ 5,660,775
Other comprehensive income, net of tax:
Foreign currency translation adjustments (279,621) 83,766
------------ ------------
Comprehensive income $ 7,368,782 $ 5,744,541
============ ============
</TABLE>
The accompanying notes are an integral part of these
condensed consolidated financial statements.
<PAGE>
SIMPSON MANUFACTURING CO., INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDIDED)
<TABLE>
<CAPTION>
Three Months Ended
March 31,
----------------------------
1999 1998
------------ ------------
<S> <C> <C>
Cash flows from operating activities
Net income $ 7,648,403 $ 5,660,775
------------ ------------
Adjustments to reconcile net income to net cash
provided by operating activities:
Gain on sale of capital equipment (20,219) (2,000)
Depreciation and amortization 2,540,621 2,250,933
Deferred income taxes and long-term liabilities (392,970) (104,560)
Changes in operating assets and liabilities,
net of effects of
acquisitions:
Trade accounts receivable (10,824,803) (9,687,467)
Income taxes payable 3,959,444 2,683,549
Inventories (3,281,486) (1,764,013)
Trade accounts payable 610,226 3,980,584
Accrued profit sharing trust
contributions 955,345 925,966
Accrued liabilities (367,586) (1,153,938)
Accrued cash profit sharing
and commissions (287,082) (660,295)
Other current assets (430,522) 68,817
Other noncurrent assets 57,966 (21,199)
------------ ------------
Total adjustments (7,481,066) (3,483,623)
------------ ------------
Net cash provided by operating activities 167,337 2,177,152
------------ ------------
Cash flows from investing activities
Capital expenditures (4,064,037) (5,692,243)
Proceeds from sale of equipment 68,467 2,380
------------ ------------
Net cash used in investing activities (3,995,570) (5,689,863)
------------ ------------
Cash flows from financing activities
Issuance of debt, net of repayments (11,389) 343,472
Issuance of Company's common stock 79,394 (458)
------------ ------------
Net cash provided by financing activities 68,005 343,014
------------ ------------
Net decrease in cash and cash equivalents (3,760,228) (3,169,697)
Cash and cash equivalents at beginning of period 37,402,450 19,418,689
------------ ------------
Cash and cash equivalents at end of period $ 33,642,222 $ 16,248,992
============ ============
</TABLE>
The accompanying notes are an integral part of these
condensed consolidated financial statements.
<PAGE>
SIMPSON MANUFACTURING CO., INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
Interim Period Reporting
The accompanying unaudited interim condensed consolidated financial
statements have been prepared pursuant to the rules and regulations for
reporting on Form 10-Q. Accordingly, certain information and footnotes
required by generally accepted accounting principles have been condensed or
omitted. These interim statements should be read in conjunction with the
consolidated financial statements and the notes thereto included in Simpson
Manufacturing Co., Inc.'s (the "Company's") 1998 Annual Report on Form 10-K
(the "1998 Annual Report").
The unaudited quarterly condensed consolidated financial statements have
been prepared on the same basis as the audited annual consolidated
financial statements, and in the opinion of management, contain all
adjustments (consisting of only normal recurring adjustments) necessary to
present fairly the financial information set forth therein, in accordance
with generally accepted accounting principles. The year-end condensed
consolidated balance sheet data was derived from audited financial
statements, but does not include all disclosures required by generally
accepted accounting principles. The Company's quarterly results may be
subject to fluctuations. As a result, the Company believes the results of
operations for the interim periods are not necessarily indicative of the
results to be expected for any future period.
Net Income Per Common Share
Basic net income per common share is computed based upon the weighted
average number of common shares outstanding. Common equivalent shares,
using the treasury stock method, are included in the diluted per-share
calculations for all periods when the effect of their inclusion is
dilutive.
The following is a reconciliation of basic earnings per share ("EPS") to
diluted EPS:
<TABLE>
<CAPTION>
Three Months Ended Three Months Ended
March 31, 1999 March 31, 1998
---------------------------------- ----------------------------------
Per Per
Income Shares Share Income Shares Share
------------ ------------ ------ ------------ ------------ ------
<S> <C> <C> <C> <C> <C> <C>
Basic EPS
Income available to
common shareholders $ 7,648,403 11,580,828 $ 0.66 $ 5,660,775 11,531,115 $ 0.49
Effect of Dilutive Securities
Stock options - 512,397 0.03) - 513,375 (0.02)
------------ ------------ ------ ------------ ------------ ------
Diluted EPS
Income available to
common shareholders $ 7,648,403 12,093,225 $ 0.63 $ 5,660,775 12,044,490 $ 0.47
============ ============ ====== ============ ============ ======
</TABLE>
<PAGE>
Certain prior year amounts have been reclassified to conform to the 1999
presentation with no effect on net income as previously reported.
2. Trade Accounts Receivable
Trade accounts receivable consist of the following:
<TABLE>
<CAPTION>
March 31, December 31,
----------------------------
(Unaudited)
1999 1998 1998
------------ ------------ ------------
<S> <C> <C> <C>
Trade accounts receivable $ 46,501,014 $ 35,927,002 $ 35,550,836
Allowance for doubtful accounts (1,326,334) (1,202,182) (1,173,656)
Allowance for sales discounts (450,070) (304,322) (288,058)
------------ ------------ ------------
$ 44,724,610 $ 34,420,498 $ 34,089,122
============ ============ ============
</TABLE>
3. Inventories
The components of inventories consist of the following:
<TABLE>
<CAPTION>
March 31, December 31,
----------------------------
(Unaudited)
1999 1998 1998
------------ ------------ ------------
<S> <C> <C> <C>
Raw materials $ 19,372,470 $ 18,619,797 $ 18,904,545
In-process products 5,256,131 6,091,933 5,255,755
Finished products 34,935,548 32,054,796 32,179,753
------------ ------------ ------------
$ 59,564,149 $ 56,766,526 $ 56,340,053
============ ============ ============
</TABLE>
Approximately 91% of the Company's inventories are valued using the LIFO
(last-in, first-out) method. Because inventory determination under the LIFO
method is only made at the end of each year based on the inventory levels
and costs at that time, interim LIFO determinations must necessarily be
based on management's estimates of expected year-end inventory levels and
costs. Since future estimates of inventory levels and costs are subject to
change, interim financial results reflect the Company's most recent
estimate of the effect of LIFO and are subject to adjustment based upon
final year-end inventory amounts. At March 31, 1999 and 1998, and December
31, 1998, the replacement value of LIFO inventories exceeded LIFO cost by
approximately $284,000, $777,000 and $359,000, respectively.
<PAGE>
4. Net Property, Plant and Equipment
Net property, plant and equipment consists of the following:
<TABLE>
<CAPTION>
March 31, December 31,
----------------------------
(Unaudited)
1999 1998 1998
------------ ------------ ------------
<S> <C> <C> <C>
Land $ 3,891,519 $ 3,366,519 $ 3,891,519
Buildings and site improvements 25,675,093 17,141,278 25,743,968
Leasehold improvements 3,448,358 3,334,358 3,463,063
Machinery and equipment 67,015,178 56,169,362 67,052,907
------------ ------------ ------------
100,030,148 80,011,517 100,151,457
Less accumulated depreciation
and amortization (51,851,356) (44,210,391) (49,498,717)
------------ ------------ ------------
48,178,792 35,801,126 50,652,740
Capital projects in progress 8,378,853 10,590,834 4,311,964
------------ ------------ ------------
$ 56,557,645 $ 46,391,960 $ 54,964,704
============ ============ ============
</TABLE>
5. Debt
Outstanding debt at March 31, 1999 and 1998, and December 31, 1998, and the
available credit at March 31, 1999, consisted of the following:
<TABLE>
<CAPTION>
Debt Outstanding
Available --------------------------------------------
Credit at at March 31, at
March 31, ---------------------------- December 31,
1999 1999 1998 1998
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revolving line of credit, interest
at bank's reference rate (at March 31,
1999, the bank's reference rate was
7.75%), expires June 2000 $ 12,707,081 $ - $ - $ -
Revolving term commitment, interest at
bank's prime rate (at March 31, 1999,
the bank's prime rate was 7.75%),
expires June 2000 8,866,004 - - -
Revolving line of credit, interest rate
at the bank's base rate of interest
plus 2%, expires June 1999 403,682 - - -
Revolving line of credit, interest rate
at the weighted average Euro interbank
rate of interest plus 1%, expires
February 2000 163,235 - - -
Standby letter of credit facilities 1,426,916 - - -
Term loan, interest at LIBOR plus 1.375%
(at March 31, 1999, the LIBOR plus
1.375% was 6.3375%), expires May 2008 - 2,850,000 - 2,850,000
Other notes payable and long-term debt - 34,497 29,147 45,886
------------ ------------ ------------ ------------
23,566,918 2,884,497 29,147 2,895,886
Less current portion - (327,477) (29,147) (330,704)
------------ ------------ ------------ ------------
$ 23,566,918 $ 2,557,020 $ - $ 2,565,182
============ ============ ============
Standby letters of credit issued
and outstanding (1,426,916)
------------
$ 22,140,002
============
</TABLE>
<PAGE>
As of March 31, 1999, the Company had three outstanding standby letters of
credit. Two of these letters of credit, in the aggregate amount of
$667,995, are used to support the Company's self-insured workers'
compensation insurance requirements. The third, in the amount of $758,921,
is used to guarantee performance on the Company's leased facility in the
UK. Other notes payable represent debt associated with foreign businesses
acquired in 1997.
6. Commitments and Contingencies
Note 9 to the consolidated financial statements in the Company's 1998
Annual Report provides information concerning commitments and
contingencies. From time to time, the Company is involved in various legal
proceedings and other matters arising in the normal course of business.
7. Segment Information
The Company is organized into two primary segments. The segments are
defined by types of products manufactured, marketed and distributed to the
Company's customers. The two product segments are construction connector
products and venting products. These segments are differentiated in several
ways, including the types of materials used, the production process, the
distribution channels used and the applications in which the products are
used. Transactions between the two segments were immaterial for each of the
periods presented.
The following table illustrates certain measurements used by management to
assess the performance of the segments described above as of or for the
three months ended:
March 31, March 31,
1999 1998
------------ ------------
Net Sales
Connector products $ 59,839,000 $ 47,413,000
Venting products 14,823,000 11,842,000
------------ ------------
Total $ 74,662,000 $ 59,255,000
============ ============
Income from Operations
Connector products $ 10,276,000 $ 8,191,000
Venting products 2,132,000 1,416,000
All other 21,000 (280,000)
------------ ------------
Total $ 12,429,000 $ 9,327,000
============ ============
Total Assets
Connector products $128,957,000 $111,030,000
Venting products 37,147,000 32,662,000
All other 37,706,000 18,855,000
------------ ------------
Total $203,810,000 $162,547,000
============ ============
Cash collected by the Company's subsidiaries is routinely transferred into
the Company's cash management accounts and, therefore, has been included in
the total assets of the segment entitled "All other." Cash and cash
equivalent balances in this segment were approximately $32,573,000 and
$15,055,000 as of March 31, 1999 and 1998, respectively.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
Certain matters discussed below are forward-looking statements that involve
risks and uncertainties, certain of which are discussed in this report and
in other reports filed by the Company with the Securities and Exchange
Commission. Actual results might differ materially from results suggested
by any forward-looking statements in this report.
The following is a discussion and analysis of the consolidated financial
condition and results of operations for the Company for the three months
ended March 31, 1999 and 1998. The following should be read in conjunction
with the interim Condensed Consolidated Financial Statements and related
Notes appearing elsewhere herein.
Results of Operations for the Three Months Ended March 31, 1999, Compared
with the Three Months Ended March 31, 1998
Sales increased 26.0% in the first quarter of 1999 as compared to the first
quarter of 1998. The increase reflected sales growth throughout the United
States, particularly in the southeastern portion of the country and in
California. Sales also increased in most of the Company's international
markets. Simpson Strong-Tie's first quarter sales increased 26.2% over the
same quarter last year, while Simpson Dura-Vent's sales increased 25.2%.
Simpson Strong-Tie's sales to homecenter customers grew at a higher rate
than other distribution channels. Simpson Strong-Tie's connector sales
growth was broad based across its product lines, although the growth rate
of Anchoring Systems products was the highest. Sales of all of Simpson
Dura-Vent's major product lines increased compared to the first quarter of
1998, led by above average growth rates for its Direct-Vent and chimney
product lines.
Income from operations increased 33.3% from $9,327,123 in the first quarter
of 1998 to $12,429,046 in the first quarter of 1999 as a result of higher
sales and gross margins and lower general and administrative costs as a
percentage of sales. Gross margins increased from 36.9% in the first
quarter of 1998 to 38.1% in the first quarter of 1999 primarily due to
better absorption of fixed overhead costs as a result of the increased
production. Selling expenses increased 40.4% from $5,624,774 in the first
quarter of 1998 to $7,897,807 in the first quarter of 1999. The increase
was primarily due to higher promotional expenses as well as higher costs
related to an increase in the number of sales and marketing personnel.
General and administrative expenses increased 17.1% from $6,864,496 in the
first quarter of 1998 to $8,038,761 in the first quarter of 1999 primarily
due to increased cash profit sharing resulting from higher operating
income. The effective tax rate was 40.1% in the first quarter of 1999, a
slight decrease from the first quarter of 1998.
Liquidity and Sources of Capital
As of March 31, 1999, working capital was $111.7 million as compared to
$86.3 million at March 31, 1998, and $105.6 million at December 31, 1998.
The principal components of the increase in working capital from December
31, 1998, were increases in the Company's trade accounts receivable and
inventories totaling approximately $13.9 million, primarily due to higher
sales levels and seasonal buying programs. Partially offsetting these
increases was a decrease in cash and cash equivalents of approximately $3.8
million as well as increases in certain liability accounts, including
income taxes payable, accrued cash profit sharing trust contributions and
trade accounts payable. These accounts increased an aggregate of
approximately $5.5 million. The balance of the change in working capital
was due to the fluctuation of various other asset and liability accounts.
The working capital change combined with net income and noncash expenses,
such as depreciation and amortization, totaling approximately $10.2
million, resulted in net cash provided by operating activities of
approximately $0.2 million. As of March 31, 1999, the Company had unused
credit facilities available of approximately $22.1 million.
The Company used approximately $4.0 million in its investing activities,
primarily to purchase the capital equipment and property needed to expand
its capacity. The Company plans to continue this expansion throughout the
remainder of the year and into 2000.
The Company believes that cash generated by operations and borrowings
available under its existing credit agreements, will be sufficient for the
Company's working capital needs and planned capital expenditures through
the remainder of 1999 and into 2000. Depending on the Company's future
growth, it may become necessary to secure additional sources of financing.
<PAGE>
Year 2000 Problem
The year 2000 problem is primarily the result of computer programs and
computer controlled equipment using two digits rather than four to define
the applicable year. Such software may recognize a date using "00" as the
year 1900 rather than the year 2000. This could potentially result in
system failures or miscalculations leading to disruptions in the Company's
activities or those of its significant customers, suppliers and banks.
The Company does not produce or sell any computer components, software or
electronic parts in its normal business environment and, therefore, does
not believe that it has any material risk of product liability or
obsolescence resulting from the year 2000 problem.
In 1998, the Company established a Year 2000 Committee (the "Committee") to
evaluate the extent, if any, of its year 2000 and associated problems, to
make any required changes and to establish contingency plans. The Company's
computer systems are PC based with few interfaces to other internal
systems. These systems use a date handling routine that the Company
believes to be year 2000 compliant. The Company has completed tests of its
internal software which demonstrated no significant risk from the year 2000
problem.
The Company is also focusing on major customers, suppliers and equipment
used in its operations to assess compliance. The Committee will continue to
evaluate these areas of exposure and, where possible, will develop
contingency plans and alternative sources to avoid interruptions in the
Company's business. Nevertheless, the Company cannot give any assurance
that there will not be a material adverse effect on the Company if third
parties with whom the Company conducts business do not adequately address
the year 2000 problem and, therefore, are unable to conduct operations
without interruption.
Costs related to the year 2000 problem are funded through operating cash
flows. The Committee estimates that the costs of addressing the year 2000
problem are expected to be less than $100,000, most of which has been
spent. The Company presently expects that the total cost of achieving year
2000 compliant systems will not be material to its financial condition,
liquidity or results of operations.
Time and cost estimates are based on currently available information.
Developments that could affect estimates include, but are not limited to,
the availability and cost of trained personnel, the ability to locate and
correct all relevant computer code and systems, and the degree of
remediation success of the Company's customers, suppliers and banks in
finding and resolving their year 2000 problems.
<PAGE>
PART II -- OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
From time to time, the Company is involved in various legal proceedings and
other matters arising in the normal course of business.
ITEM 2. CHANGES IN SECURITIES.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
ITEM 5. OTHER INFORMATION.
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
<TABLE>
<CAPTION>
a. Exhibits.
EXHIBIT
NO DESCRIPTION
------- ------------------------------------------------------
<S> <C>
11 Statements re computation of earnings per share
27 Financial Data Schedule, which is submitted
electronically to the Securities and Exchange
Commission for information only and not filed.
b. Reports on Form 8-K
No reports on Form 8-K were filed during the quarter for
which this report is filed.
</TABLE>
<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.
Simpson Manufacturing Co., Inc.
-------------------------------
(Registrant)
DATE: MAY 14, 1999 By: /s/Stephen B. Lamson
------------------ -------------------------------
Stephen B. Lamson
Chief Financial Officer
<TABLE>
<CAPTION>
SIMPSON MANUFACTURING CO., INC. AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER COMMON SHARE
(UNAUDITED)
EXHIBIT 11
--------------
Basic Earnings per Share
Three Months Ended
March 31,
----------------------------
1999 1998
------------ ------------
<S> <C> <C>
Weighted average number of common
shares outstanding 11,580,828 11,531,115
============ ============
Net income $ 7,648,403 $ 5,660,775
============ ============
Basic net income per share $ 0.66 $ 0.49
============ ============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SIMPSON MANUFACTURING CO., INC. AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER COMMON SHARE
(UNAUDITED)
EXHIBIT 11
--------------
DILUTED EARNINGS PER SHARE
Three Months Ended
March 31,
----------------------------
1999 1998
------------ ------------
<S> <C> <C>
Weighted average number of common
shares outstanding 11,580,828 11,531,115
Shares issuable pursuant to employee
stock option plans, less shares
assumed repurchased at the average
fair value during the period 509,039 508,522
Shares issuable pursuant to the
independent director stock option
plan, less shares assumed repurchased
at the average fair value during
the period 3,358 4,853
------------ ------------
Number of shares for computation of
diluted net income per share 12,093,225 12,044,490
============ ============
Net income $ 7,648,403 $ 5,660,775
============ ============
Diluted net income per share $ 0.63 $ 0.47
============ ============
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Condensed Consolidated Balance Sheet at March 31, 1999, (Unaudited)
and the Condensed Consolidated Statement of Operations for the three
months ended March 31, 1999, (Unaudited) and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 33,642,222
<SECURITIES> 0
<RECEIVABLES> 46,501,014
<ALLOWANCES> 1,776,404
<INVENTORY> 59,564,149
<CURRENT-ASSETS> 143,690,342
<PP&E> 108,409,001
<DEPRECIATION> 51,851,356
<TOTAL-ASSETS> 203,810,340
<CURRENT-LIABILITIES> 32,020,215
<BONDS> 2,884,497
0
0
<COMMON> 33,871,198
<OTHER-SE> 134,927,300
<TOTAL-LIABILITY-AND-EQUITY> 203,810,340
<SALES> 74,661,590
<TOTAL-REVENUES> 74,661,590
<CGS> 46,212,976
<TOTAL-COSTS> 46,212,976
<OTHER-EXPENSES> 16,019,568
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0<F1>
<INCOME-PRETAX> 12,777,403
<INCOME-TAX> 5,129,000
<INCOME-CONTINUING> 7,648,403
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 7,648,403
<EPS-PRIMARY> 0.66
<EPS-DILUTED> 0.63
<FN>
<F1>Interest income for the three months ended March 31, 1999,
was $348,357.
</FN>
</TABLE>
