UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
-----------
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the Quarterly Period Ended December 27, 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 000-25l02
BRIDGEPORT MACHINES, INC.
(exact name of registrant as specified in its charter)
Delaware 06-ll69678
(State of Incorporation) (IRS Employer Identification No.)
500 Lindley Street, Bridgeport, CT 06606
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code:
(203) 367-365l
NOT APPLICABLE
(Former name, former address and former fiscal year,
if changed since last report)
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 Issuer's Common Stock, $.0l par value, outstanding on
December 27, l997 was 5,680,404 shares.
<PAGE>
BRIDGEPORT MACHINES, INC.
AND SUBSIDIARIES
INDEX
Part I - FINANCIAL INFORMATION
Item l. FINANCIAL STATEMENTS
Consolidated Balance Sheets as of
December 27, 1997 and March 29, 1997
Consolidated Income Statements for
the three month and nine month periods
ended December 27, 1997 and December 28,
1996
Consolidated Statements of Stockholders'
Equity for the nine month periods ended
December 27, 1997 and December 28, 1996
Consolidated Statements of Cash Flows
for the nine month periods ended
December 27, 1997 and December 28, 1996
Notes to Consolidated Financial Statements
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
Part II - OTHER INFORMATION
Item l-4. OTHER INFORMATION
Item 5. OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
Signatures
<PAGE>
<TABLE>
<CAPTION>
BRIDGEPORT MACHINES, INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share Amounts)
December 27, March 29,
1997 1997
--------- ---------
ASSETS
<S> <C> <C>
CURRENT ASSETS:
Cash ................................... $ 3,721 $ 2,992
Trade accounts receivable,
less allowance of $1,621
and $1,440, respectively ............. 39,564 38,691
Inventories ............................ 62,071 63,068
Deferred income taxes .................. 3,144 3,144
Prepaid expenses and other current
assets ............................... 1,512 1,944
--------- ---------
Total current assets ............... 110,012 109,839
NOTES RECEIVABLE - NON-CURRENT ................. 292 --
PROPERTY, PLANT AND EQUIPMENT
Land ................................... 351 345
Buildings, improvements and
leasehold improvements ............... 4,052 3,908
Machinery and equipment ................ 20,168 19,164
Furniture and fixtures ................. 5,637 4,732
--------- ---------
30,208 28,149
Less: Accumulated depreciation ................ (10,258) (7,848)
--------- ---------
Property, plant and equipment,
net .................................. 19,950 20,301
--------- ---------
INVESTMENTS IN AFFILIATED COMPANIES ............ 650 1,008
OTHER ASSETS, net of accumulated
amortization of $1,560
and $1,485 respectively ................ 264 563
--------- ---------
Total assets ...................... $ 131,168 $ 131,711
========= =========
</TABLE>
The accompanying notes to consolidated financial statements are an integral part
of these financial statements.
<PAGE>
<TABLE>
<CAPTION>
BRIDGEPORT MACHINES, INC.
CONSOLIDATED BALANCE SHEETS
(In Thousands, Except Share Amounts)
December 27, March 29,
l997 l997
------------ ------------
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Bank overdrafts ..................... $ 1,696 $ 2,254
Working capital revolver ............ 21,998 21,910
Accounts payable .................... 16,266 16,568
Accrued expenses .................... 15,672 13,055
Income taxes payable ................ 1,175 3,794
Current portion of long-term debt
obligations ....................... 2,456 2,562
------------ ------------
Total current liabilities ...... 59,263 60,143
LONG-TERM DEBT OBLIGATIONS .................. 3,876 5,862
OTHER LONG-TERM LIABILITIES ................. 120 120
------------ ------------
Total liabilities .............. 63,259 66,125
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock, $.0l par value,
2,000,000 shares authorized,
no shares issued .................. -- --
Common stock, $.0l par value,
13,000,000 shares authorized;
5,680,404 shares issued and
outstanding, including treasury
stock, at December 27, 1997 and
5,679,361 shares issued and
outstanding at March 29, 1997 ..... 57 57
Capital in excess of par value ...... 38,293 38,285
Retained earnings--subsequent to
reclassification of $6,750 deficit
as part of the quasi-reorganization
as of January 3, l993.............. 29,544 27,076
Cumulative translation adjustment ... 524 168
Treasury stock at cost, 50,000 shares (509) --
------------ ------------
Total stockholders' equity ..... 67,909 65,586
------------ ------------
Total liabilities and stock-
holders' equity ................ $ 131,168 $ 131,711
============ ============
</TABLE>
The accompanying notes to consolidated financial statements are an integral part
of these financial statements.
<PAGE>
<TABLE>
<CAPTION>
BRIDGEPORT MACHINES, INC.
CONSOLIDATED INCOME STATEMENTS
FOR THE THREE MONTH AND NINE MONTH PERIODS
ENDED DECEMBER 27, 1997 AND DECEMBER 28, 1996
(In Thousands, Except Per Share Amounts)
THREE MONTHS ENDED NINE MONTHS ENDED
December 27, December 28, December 27, December 28,
1997 1996 1997 1996
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net sales .......... $ 58,728 $ 59,779 $ 158,170 $ 173,471
Cost of sales ...... 45,632 47,081 122,959 134,977
--------- --------- --------- ---------
Gross profit ..... 13,096 12,698 35,211 38,494
Selling, general and
administrative
expenses ......... 9,774 8,928 28,706 26,487
--------- --------- --------- ---------
Operating income 3,322 3,770 6,505 12,007
Interest expense ... (654) (755) (1,955) (2,181)
Other income, net .. 222 58 268 149
--------- --------- --------- ---------
Income before
provision for
income taxes ... 2,890 3,073 4,818 9,975
Provision for
income taxes ..... 1,166 1,135 2,350 3,703
--------- --------- --------- ---------
Net income ..... $ 1,724 $ 1,938 $ 2,468 $ 6,272
========= ========= ========= =========
Basic earnings
per share ........ $ 0.30 $ 0.34 $ 0.44 $ 1.10
========= ========= ========= =========
Diluted earnings
per share ........ $ 0.30 $ 0.34 $ 0.43 $ 1.09
========= ========= ========= =========
</TABLE>
The accompanying notes to consolidated financial statements are an integral part
of these financial statements.
<PAGE>
<TABLE>
<CAPTION>
BRIDGEPORT MACHINES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
FOR THE NINE MONTH PERIODS ENDED DECEMBER 27, 1997 AND DECEMBER 28, 1996
(In Thousands)
CAPITAL IN CUMULATIVE
COMMON EXCESS OF RETAINED TRANSLATION TREASURY
STOCK PAR VALUE EARNINGS ADJUSTMENT STOCK
------- ----------- -------- ----------- --------
<S> <S> <C> <C> <C> <C>
BALANCE, March 30, 1996 .. $ 57 $38,259 $19,075 $ (282) $ --
Net income for the nine
months ended December
28, 1996 ............... -- -- 6,272 -- --
Translation adjustment
for the nine months
ended December 28, 1996 -- -- -- 2,044 --
Exercise of stock options
for common stock ....... -- 26 -- -- --
------- ------- ------- ------- -------
BALANCE, December 28, 1996 $ 57 $38,285 $25,347 $ 1,762 $ --
======= ======= ======= ======= =======
BALANCE, March 29, 1997 .. $ 57 $38,285 $27,076 $ 168 $ --
Net income for the nine
months ended December
27, 1997 ............... -- -- 2,468 -- --
Translation adjustment
for the nine months
ended December 27, 1997 -- -- -- 356 --
Exercise of stock options
for common stock ....... -- 8 -- -- --
Purchase of treasury
stock at cost .......... -- -- -- -- (509)
------- ------- ------- ------- -------
BALANCE, December 27, 1997 $ 57 $38,293 $29,544 $ 524 $ (509)
======= ======= ======= ======= =======
</TABLE>
The accompanying notes to consolidated financial statements are an integral part
of these financial statements.
<PAGE>
<TABLE>
<CAPTION>
BRIDGEPORT MACHINES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTH PERIODS ENDED DECEMBER 27, 1997 AND DECEMBER 28, 1996
(In Thousands)
December 27, December 28,
1997 1996
------------ ------------
<S> <C> <C>
CASH FLOWS PROVIDED BY (USED IN)
OPERATING ACTIVITIES:
Net income .......................................... 2,468 6,272
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation and amortization ................ 2,525 2,481
Net (gain) on sale of property,
plant and equipment ........................ -- (3)
Changes in operating assets and
liabilities:
(Increase) decrease in net trade
accounts receivable ............................. 1,311 (2,260)
(Increase) decrease in inventories ................ 4,150 (2,535)
(Increase) decrease in prepaid
expenses and other current assets ............... 502 (424)
(Increase) decrease in other assets................ 295 (73)
Increase (decrease) in bank overdrafts ............ (558) (205)
Increase (decrease) in accounts payable
and accrued expenses ............................ (3,744) (4,842)
------ ------
Total adjustments ............................... 4,481 (7,861)
------ ------
Cash flows provided by (used in)
operating activities ............................ 6,949 (1,589)
------ ------
CASH FLOWS PROVIDED BY (USED IN)
INVESTING ACTIVITIES:
Capital expenditures ................................ (2,210) (1,908)
Proceeds from sale of property,
plant and equipment ............................... 9 71
Purchase of certain assets of a
distributor ....................................... (1,245) --
------ ------
Cash flows (used in)
investing activities ............................ (3,446) (1,837)
------ ------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
(Continued)
BRIDGEPORT MACHINES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTH PERIODS ENDED DECEMBER 27, 1997 AND DECEMBER 28, 1996
(In Thousands)
December 27, December 28,
1997 1996
------- -------
<S> <C> <C>
CASH FLOWS PROVIDED BY (USED IN)
FINANCING ACTIVITIES:
Sale of common stock ....................... 8 26
Borrowings (payments) under working
capital revolver, net .................... (301) (472)
Borrowings (payments) of other debt and
capitalized lease obligations ............ (1,927) 3,417
Purchase of Treasury Stock ................. (509) --
------- -------
Cash flows provided by (used in)
financing activities ................... (2,729) 2,971
------- -------
Effect of exchange rate changes
on cash .................................. (45) 69
------- -------
Net change in cash ....................... 729 (386)
CASH, begining of period ................... 2,992 4,960
------- -------
CASH, end of period ........................ $ 3,721 $ 4,574
======= =======
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid .............................. $ 1,994 $ 2,879
Income taxes paid (received), net .......... 4,048 3,927
</TABLE>
The accompanying notes to consolidated financial statements are an integral part
of these financial statements.
<PAGE>
BRIDGEPORT MACHINES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. THE COMPANY AND BASIS OF PRESENTATION
Bridgeport Machines, Inc. and subsidiaries (the "Company") is a
manufacturer and distributor of metal cutting machine tools and
accessories. The Company manufactures its products in the U.S. and
Europe. Sales are principally in North America and Europe. A
substantial portion of the end users of the Company's products are
small and medium sized independent job shops who produce machined parts
for customers in a wide variety of industries.
The consolidated balance sheet as of December 27, 1997 and the related
consolidated statements of income, stockholders' equity and cash flows
for the nine months ended December 27, 1997 and December 28, 1996 have
been prepared by the Company without audit. In the opinion of
management, all adjustments necessary to present fairly the financial
position, results of operations and cash flows as of or for the periods
ended December 27, 1997 and December 28, 1996 have been made. The
accounting principles followed during interim periods are generally
consistent with those applied for annual periods and are described in
the Company's financial statements included in its Form 10-K filed with
the Securities and Exchange Commission (the "SEC").
2. INTERIM STATEMENTS
The following accounting policies which are applied in the preparation
of the interim financial statements are different from those applied in
the year-end financial statements:
Inventories:
Inventory values are verified annually based upon actual
inventory on hand substantiated by a physical count.
Inventories are adjusted during interim periods for purchases,
production and shipments based upon standard costs for
material, labor and overhead.
Income Taxes:
The income tax provision is calculated based upon an estimated
effective tax rate for each tax jurisdiction.
3. EARNINGS PER SHARE
In February 1997, Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" ("FAS 128"), was issued. FAS 128 establishes new
standards for computing and presenting Earnings Per Share. The Company
was required to adopt the new standard in the current quarter. Earnings
Per Share information for prior periods has been restated using the new
guidelines.
<PAGE>
The following table presents a computation of earnings per share:
<TABLE>
<CAPTION>
BASIC EARNINGS PER SHARE
Per Share
Period Net Income Shares Amount
------ ---------- ------ ------
<S> <C> <C> <C>
Three months ended
December 27, 1997 $1,724,000 5,680,000 $0.30
Three months ended
December 28, 1996 $1,938,000 5,679,000 $0.34
Nine months ended
December 27, 1997 $2,468,000 5,669,000 $0.44
Nine months ended
December 28, 1996 $6,272,000 5,678,000 $1.10
<CAPTION>
DILUTIVE EARNINGS PER SHARE
Per Share
Period Net Income Shares Amount
------ ---------- ------ ------
<S> <C> <C> <C>
Three months ended
December 27, 1997 $1,724,000 5,691,000 $0.30
Three months ended
December 28, 1996 $1,938,000 5,705,000 $0.34
Nine months ended
December 27, 1997 $2,468,000 5,678,000 $0.43
Nine months ended
December 28, 1996 $6,272,000 5,730,000 $1.09
</TABLE>
<PAGE>
The difference between the shares used in the basic EPS computation and
the shares used in the dilutive EPS computation is the effect of
dilutive stock options. The table below presents stock options to
purchase shares of common stock that were not included in the
computation of dilutive EPS because the option's exercise price was
greater than the average market price of the common stock.
<TABLE>
<CAPTION>
Shares Covered by
Period Stock Options Exercise Price
------ ------------- --------------
<S> <C> <C>
Three months ended
December 27, 1997 198,600 $10.75 - $16.25
Three months ended
December 28, 1996 59,500 $12.00 - $16.25
Nine months ended
December 27, 1997 198,600 $10.75 - $16.25
Nine months ended
December 28, 1996 36,500 $14.38 - $16.25
</TABLE>
4. ACQUISITION
On August 1, 1997, the Company acquired certain assets and assumed
certain liabilities of its German distributor. The acquisition was
accounted for as a purchase. The Company will pay in installments
approximately $2.1 million in cash for the assets acquired and assumed
approximately $2.5 million of liabilities. The purchase price
approximated book value. The purchase did not meet the significant
subsidiary rules of SEC reporting requirements.
<PAGE>
BRIDGEPORT MACHINES, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS:
The following table sets forth, for the periods indicated, the
percentage of net sales represented by certain items reflected in the Company's
consolidated financial statements:
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
December 27, December 28, December 27, December 28,
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net sales .......... 100.0% 100.0% 100.0% 100.0%
Gross profit ....... 22.3 21.2 22.3 22.2
Selling, general and
administrative
expenses ......... 16.6 14.9 18.1 15.3
Operating income ... 5.7 6.3 4.1 6.9
Interest expense ... 1.1 1.3 1.2 1.3
Other income
(expense) ........ 0.4 0.1 0.2 0.1
Income tax expense.. 2.0 1.9 1.5 2.1
Net income ......... 2.9 3.2 1.6 3.6
</TABLE>
COMPARISON OF THE THREE MONTHS ENDED DECEMBER 27, 1997 ("THIRD QUARTER OF FISCAL
1998") TO THE THREE MONTHS ENDED DECEMBER 28, 1996 ("THIRD QUARTER OF FISCAL
1997")
Net sales were $58.7 million in the third quarter of fiscal l998, a
decrease of $1.1 million, or 1.8%, as compared to the second quarter of fiscal
l997.
Backlog at December 27, 1997 was approximately $40.2 million compared
with $35.5 million at March 29, 1997. The Company's backlog balances fluctuate
as a result of many factors including length of time to deliver products, new
product introductions and market conditions.
Gross profit was $13.1 million in the third quarter of fiscal l998, an
increase of $0.4 million, or 3.1%, as compared to the third quarter of fiscal
l997. Gross profit as a percent of net sales was 22.3% compared with 21.2% in
the third quarter of fiscal 1997. Gross profit as a percent of net sales
increased primarily as a result of the effect of the Company's direct sales
operations in Germany which did not exist in the prior year, cost reduction
efforts in the Company's U.S. operations, and the elimination of a price
discounting program on manual milling machines that was in effect in the quarter
ended December 28, 1996.
<PAGE>
These improvements were offset to some extent by a decline in gross
profit as a percent of net sales in the Company's European operations due to
price discounting offered to continental European customers to offset the higher
prices to those customers of the Company's United Kingdom manufactured products
due to the strength of the British pound versus other European currencies.
Selling, general and administrative expenses were $9.8 million in the
third quarter of fiscal l998, an increase of $0.8 million, or 9.5%, as compared
to the third quarter of fiscal l997. The Company's direct sales operations in
Germany which did not exist in the prior year accounted for approximately $0.7
million of the increase. These new operations expenses consist primarily of
salary and salary related expenses, sales and agent commissions and rent
expense. The remaining increase was a result of small increases in numerous
categories. As a percentage of net sales, selling, general and administrative
expenses were 16.6% in the third quarter of fiscal l998, as compared to 14.9%
for the third quarter of fiscal l997.
Operating income was $3.3 million for the third quarter of fiscal l998,
as compared to operating income of $3.8 million for the third quarter of fiscal
l997.
Interest expense was $0.7 million for the third quarter of fiscal l998
as compared to $0.8 for the third quarter of fiscal l997.
Provision for income taxes was $1.2 million in the third quarter of
fiscal l998, compared to a provision for income taxes of $1.1 million in the
third quarter of fiscal 1997. The effective tax rate was 40.3% in the third
quarter of fiscal 1998 compared to an effective rate of 36.9% in the third
quarter of fiscal 1997. The increase in the effective tax rate is a result of
more income being generated in higher tax jurisdictions versus the prior year
and, to a lesser extent, no tax benefits for losses incurred in the Company's
German operations being established because they are not currently recognizable
for tax return purposes.
COMPARISON OF THE NINE MONTHS ENDED DECEMBER 27, 1997 TO THE NINE MONTHS ENDED
DECEMBER 28, 1996
Net sales were $158.2 million for the nine months ended December 27,
1997, a decrease of $15.3 million, or 8.8%, as compared to the nine months ended
December 28, 1996. The decrease in sales is due to a decline in sales in Europe.
The decline in European sales is a result of weak market conditions in
continental Europe and higher selling prices in continental Europe of the
Company's United Kingdom manufactured products due to the increased value of the
British pound versus other European currencies.
Gross profit was $35.2 million for the nine months ended December 27,
1997, a decrease of $3.3 million, or 8.5%, as compared to the nine months ended
December 28, 1996. The gross profit as a percentage of net sales was 22.3% for
the nine months ended December 27, 1997 versus 22.2% for the nine months ended
December 28, 1996. Included in cost of sales for the nine months ended December
28, 1996 is a $700,000 refund of import duties for prior periods which had
previously been expensed. In August 1996, the United States government
retroactively reinstated the General System of Preferences which allowed the
Company to obtain a refund of import duties. Without this refund, gross profit
as a percent of sales was 21.8%.
<PAGE>
The increase in gross profit as a percent of sales to 22.3% for the
nine months ended December 27, 1997 as compared to the normalized gross profit
as a percent of sales of 21.8% for the nine months ended December 28, 1996 is a
result of improvements in the gross profit margin in the Company's U.S.
operations offset to some extent by a decline in the gross profit margin in the
Company's European operations.
Gross profit as a percent of net sales increased in the Company's U.S.
operations primarily as a result of cost reduction efforts and the elimination
of price discounts on certain products that were in effect in the nine months
ended December 28, 1996. The decline in the Company's European operation's gross
profit as a percent of sales was a result of weak market conditions in
continental Europe and price discounting offered to continental European
customers to offset higher prices to these customers of the Company's U.K.
manufactured products due to the increased value of the British pound versus
other European currencies.
Selling, general and administrative expenses were $28.7 million for the
nine months ended December 27, 1997, an increase of $2.2 million, or 8.4%, as
compared to the nine months ended December 28, 1996. The Company's direct sales
operations in Germany which did not exist in the prior year accounted for $1.1
million of the increase. These new operations expenses consist primarily of
salary and salary related expenses, sales and agent commissions and rent
expense. The remaining increase was a result of small increases in numerous
categories. As a percentage of net sales, selling, general and administrative
expenses were 18.1% for the nine months ended December 27, 1997, as compared to
15.3% for the nine months ended December 28, 1996.
Operating income was $6.5 million for the nine months ended December
27, 1997, as compared to $12.0 million for the nine months ended December 28,
1996.
Interest expense was $2.0 million for the nine months ended December
27, 1997 and $2.2 million for the nine months ended December 28, 1996.
Provision for income taxes was $2.4 million for the nine months ended
December 27, 1997, a decrease of $1.4 million or 36.5%. The effective tax rate
was 48.8% in the nine months ended December 27, 1997 as compared to 37.1% in the
nine months ended December 28, 1998. The increase in the effective tax rate is
primarily due to no tax benefits for losses incurred in the Company's German
operations being established because they are not currently recognizable for tax
return purposes. To a lesser extent, the increase in the effective tax rate
resulted from more income being generated in higher tax jurisdictions versus the
prior year.
FOREIGN OPERATIONS:
During the nine months ended December 27, 1997, net sales outside North
America represented approximately 41.3% of total net sales, as compared to 47.5%
for the nine months ended December 28, 1996. A substantial portion of these net
sales were made by the Company's European operations.
Generally, from time to time, the Company enters into forward exchange
contracts to provide economic hedges against foreign currency fluctuations
primarily on its intercompany sales transactions between its U.S. and U.K.
operations. At December 27, 1997, the Company did not have any outstanding
commitments under forward purchase contracts.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES:
As of December 27, 1997, the Company had working capital of $50.7
million compared with $49.7 million at March 29, 1997. The Company meets its
short-term financing needs through cash from operations and its revolving credit
facility which provides for maximum borrowings of up to $24.5 million in the
United States and $19.5 million in the United Kingdom.
The table below presents the summary of cash flow for the periods
indicated:
<TABLE>
<CAPTION>
NINE MONTHS ENDED
December 27, 1997 December 28, 1996
----------------- -----------------
<S> <C> <C>
Net cash provided by (used in)
operating activities 6,949 (1,589)
Net cash (used in)
investing activities (3,446) (1,837)
Net cash provided by (used in)
financing activities (2,729) 2,971
</TABLE>
Net cash provided by (used in) operating activities fluctuates between
periods primarily as a result of differences in net income, the timing of the
collection of accounts receivable, purchase of inventory, level of sales and
payment of accounts payable. Included in cash used in investing activities in
the nine months ended December 27, 1997 is a $1.2 million payment for the
purchase of certain assets as discussed in Note 4 to the financial statements.
The net cash provided by (used in) financing activities in the nine months ended
December 27, 1997 and December 28, 1996, represents primarily net borrowings or
repayments of debt.
The Company believes that cash generated from operations and borrowings
available under the revolving credit facility will be sufficient to meet its
working capital and capital expenditure requirements for at least 12 months from
December 27, 1997. Such facility, together with cash from operations, is
expected to be sufficient to enable the Company to meet its working capital and
capital expenditure needs for the longer term. However, there can be no
assurance that liquidity would not be adversely impacted by a decline in general
economic conditions or other factors, or that future credit facilities will be
available.
CHANGES IN FINANCIAL POSITION:
At December 27, 1997, accounts receivable increased $0.9 million as
compared to March 27, 1997 and inventories decreased $1.0 million as compared to
March 27, 1997.
ECONOMIC CYCLES:
The overall market for machine tools is cyclical, reflecting economic
conditions, production capacity utilization, changes in tax and fiscal policies,
corporate profitability and financial condition as well as the general level of
business confidence.
<PAGE>
PART II - OTHER INFORMATION
Item l Legal Proceedings
On September 9, 1997, the Company settled out of court a legal
action in which the Company was a defendant. The action which
was filed by IMS Technology, Inc., the plaintiff, related to
alleged patent infringement. The settlement entered into by
the Company did not have a material adverse effect on the
Company's financial position or results of operations.
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 Exhibit No.
a) Exhibits
(2) Not Applicable
(4) Not Applicable
(l0) Not Applicable
(ll) Statement regarding computation of per share
earnings is not required because the relevant
computation can be determined from the material
contained in the Financial Statements included
herein.
(l5) Not Applicable
(18) Not Applicable
(l9) Not Applicable
(22) Not Applicable
(23) Not Applicable
(24) Not Applicable
(27) Financial Data Schedule
(99) Not Applicable
b) There were no reports or exhibits on Form 8-K filed
during the three months ended December 27, 1997.
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of l934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereto duly authorized.
BRIDGEPORT MACHINES, INC.
(Registrant)
February 5, 1998 /s/ Dan L. Griffith
-------------------
By: Dan L. Griffith
President and
Chief Executive Officer
February 5, 1998 /s/ Walter C. Lazarcheck
------------------------
By: Walter C. Lazarcheck
Vice President and
Chief Financial Officer
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