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
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): February 5, 1996
DYNATECH CORPORATION
(Exact name of registrant as specified in its charter)
MASSACHUSETTS 0-7438 04-2258582
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
3 NEW ENGLAND EXECUTIVE PARK
BURLINGTON, MASSACHUSETTS 01803-5087
(Address of principal executive offices, including zip code)
(617) 272-6100
(Registrant's telephone number, including area code)
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On February 5, 1996, Dynatech Corporation (the "Company") announced that it had
entered into an agreement for the sale of substantially all of the assets of its
Dynatech Laboratories Worldwide ("DLW") subsidiary to Thermo BioAnalysis, a
subsidiary of Thermo Instrument Systems, Inc., for approximately $43 million in
cash. DLW manufactures automated equipment and disposable plasticware used in
medical research and clinical immunodiagnostic testing. The transaction closed
on February 7, 1996.
ITEM 5. OTHER EVENTS
On February 7, 1996, the Company announced a plan of disposal to discontinue
operations of its broadcast video equipment and selected data transmission
operations. The 10 businesses marked for divestiture, including the medical and
diagnostic businesses previously announced for divestiture, account for
approximately $180 million in annual revenues.
On February 7, 1996, the Company also announced that its Board of Directors had
authorized the repurchase of up to 1,000,000 shares of the Company's Common
Stock. The Company intends to effect the repurchases from time to time through
open market purchases and negotiated transactions.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(b) Pro Forma Financial Information
1. Unaudited Pro Forma Consolidated Balance Sheet at December 31, 1995.
2.Unaudited Pro Forma Consolidated Statement of Operations for the Fiscal
Year Ended March 31, 1995.
3.Unaudited Pro Forma Consolidated Statement of Operations for the Nine
Month Period ended December 31, 1995.
4. Notes to the Pro Forma Financial Statements.
(c) EXHIBITS
2 Purchase Agreement dated February 5, 1996 by and among Dynatech
Laboratories, Inc. and Thermo BioAnalysis Corporation
99.1 Press Release dated February 5, 1996
99.2 Press Release dated February 7, 1996
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.
DYNATECH CORPORATION
Date: February 15, 1996 By: ROBERT H. HERTZ
Treasurer and Chief
Financial Officer
PRO FORMA FINANCIAL INFORMATION
For purposes of this presentation, pro forma adjustments have been made to the
historical results of operations and balance sheet to provide information as to
how the dispositions might have affected the results of operations and financial
position. The unaudited pro forma consolidated balance sheet was prepared as if
all dispositions occurred as of December 31, 1995.
The unaudited pro forma consolidated statements of operations assume all
dispositions had taken place at the beginning of the corresponding fiscal year.
This unaudited pro forma information does not purport to be indicative of the
results of operations that would have been obtained if the dispositions had
occurred at the beginning of the fiscal year presented, and is not intended to
be a projection of future results.
The following unaudited pro forma financial information is provided:
1. Pro Forma Consolidated Balance Sheet as of December 31, 1995.
2. Pro Forma Consolidated Statement of Operation for the nine month period
ended December 31, 1995.
3. Pro Forma Consolidated Statement of Operation for the fiscal year ended
March 31, 1995.
4. Notes to the Pro Forma Financial Information.
DYNATECH CORPORATION
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
AT DECEMBER 31, 1995
IN (000'S)
ACTUAL BUSINESSES PRO FORMA
BALANCE TO BE BALANCE SHEET
SHEET DISPOSED 12/31/95
12/31/95
ASSETS
Cash and cash equivalents ....... $ 34,427 $ $34,427
Accounts receivable, net ...... 81,740 (33,052) 48,688
Inventories:
Raw materials ................ 24,476 (17,208) 7,268
Work in process .............. 12,406 (3,824) 8,582
Finished goods ............... 18,730 (10,280) 8,450
--------- -------- --------
55,612 (31,312) 24,300
--------- -------- --------
Other Current Assets ............ 19,658 (5,667) 13,991
Net assets held for sale ........ 60,122 60,122
--------- -------- --------
Total current assets ......... 191,437 (9,909) 181,528
Property and equipment, net ..... 32,310 (13,535) 18,775
Intangible assets, net .......... 30,649 (5,277) 25,372
Other assets .................... 11,846 (698) 11,148
$ 266,242 $ (29,419) $ 236,823
========= ========== =========
LIABILITIES
Current liabilities:
Notes payable and current portion
of long - term debt ......... $ 4,441 $ 0 $ 4,441
Accounts payable .............. 16,539 (7,940) 8,599
Streamlining and restructuring 8,024 (8,024)
accrual
Other accrued expenses ........ 48,994 (13,455) 35,539
--------- --------- ----------
Total current liabilities .. 77,998 (29,419) 48,579
Long-term debt .................. 14,815 14,815
Deferred income taxes ........... 630 630
Deferred liabilities ............ 678 678
SHAREHOLDERS' EQUITY
Common stock .................... 3,721 3,721
Additional paid in capital ...... 11,549 11,549
Retained earnings ............... 158,853 158,853
Cumulative foreign currency 977 977
adjustments
Treasury stock .................. (2,979) (2,979)
--------- -------- --------
Total shareholders' equity . 172,121 172,121
--------- -------- ----------
$ 266,242 $ (29,419) $ 236,823
========= ========= =========
DYNATECH CORPORATION
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE NINE MONTHS ENDED 12/31/95
( IN (000'S) EXCEPT PER SHARE DATA)
LESS
ACTUAL LESS BUSINESSES PRO FORMA
RESULTS BUSINESSES TO BE RESULTS
12/31/95 DISPOSED DISPOSED 12/31/95
Sales .............................. $ 359,055 $ 8,183 $ 135,061 $ 215,811
Cost of Sales ...................... 162,815 6,654 74,026 82,135
--------- --------- --------- ----------
Gross Profit ....................... 196,240 1,529 61,035 133,676
Selling, general and administrative 119,316 2,128 44,018 73,170
expense
Product development expense ........ 43,380 508 15,582 27,290
Purchased incomplete technology .... 16,852 16,852
Business restructuring activities .. 800 (2,500) 3,300
Amortization of intangibles ........ 5,623 197 1,981 3,445
--------- --------- --------- ----------
Operating income (loss) ............ 10,269 1,196 (3,847) 12,919
Interest expense ................... (1,537) (1,537)
Interest income .................... 1,644 1,644
Other income ....................... 1,052 55 55 942
--------- --------- --------- ----------
Income (loss) from continuing 11,428 1,251 (3,791) 13,967
operations income taxes
Provision (benefit) for income taxes 4,636 (1,091) 5,727
Income (loss) from continuing 6,792 2,342 (3,791) 8,241
operations
Reversal of disposition loss from 647 647
discontinued operations, net of taxes
--------- --------- --------- ----------
Net income (loss) .................. $ 7,439 $ 2,989 $ (3,791) $ 8,241
========= ========= =========== =========
INCOME PER COMMON SHARE
Continuing operations .............. $ 0.37 $ 0.46
Extraordinary item ................. 0.04
--------- --------- --------- ---------
$ 0.41 $ 0.46
========= ========= ========= =========
Weighted average number of common shares 17,930 17,930
====== ======
DYNATECH CORPORATION
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE FISCAL YEAR ENDED MARCH 31, 1995
(IN (000'S) EXCEPT PER SHARE DATA)
LESS
ACTUAL LESS BUSINESSES PRO FORMA
RESULTS BUSINESSES TO BE RESULTS
3/31/95 DISPOSED DISPOSED 3/31/95
Sales .............................. $ 488,776 $ 58,689 $ 187,009 $ 243,078
Cost of Sales ...................... 230,802 40,827 98,563 91,412
--------- --------- --------- ---------
Gross Profit ....................... 257,974 17,862 88,447 151,666
Selling, general and administrative 160,878 15,918 58,632 86,329
expense
Product development expense ........ 53,045 3,515 18,944 30,585
Amortization of intangibles ........ 8,471 3,365 5,106
--------- --------- --------- ---------
Operating income (loss) ........... 35,580 (1,571) 7,505 29,646
Interest expense ................... (3,919) (3,919)
Interest income .................... 1,518 1,518
Other income ....................... 1,627 262 515 850
--------- --------- --------- ---------
Income (loss)from continuing 34,806 (1,309) 8,020 28,095
operations before income taxes
Provision (benefit) for income taxes 14,619 (8) 3,248 11,379
Income (loss) from continuing 20,187 (1,301) 4,772 16,717
operations
Extraordinary charge, net of tax ... (1,019) (1,019)
--------- --------- --------- ---------
Net Income (loss) .................. $ 19,168 $ (1,301) $ 4,772 $ 15,697
========= ========== ========= =========
INCOME (LOSS) PER COMMON SHARE
Continuing operations .............. $ 1.13 $ 0.94
Extraordinary item ................. (0.06) (0.06)
--------- ---------
$ 1.07 $ 0.88
========= =========
Weighted average number of common 17,846 17,846
shares ========= =========
EXPLANATORY NOTES TO THE PRO FORMA FINANCIAL STATEMENTS
1.Net assets available for sale represent the historical book value at
December 31, 1995 of those businesses which the Company anticipates divesting in
the next twelve to eighteen months.
2.The category "Businesses disposed" reflects those entities which the
Company has disposed of at the time of this filing.
The category "Businesses to be disposed" includes those businesses which are
currently being held for sale.
The Company is currently in the process of calculating costs relating to the
disposition of the businesses. Any gain or loss has not been anticipated in the
Pro Forma results.