SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q/A2
[X] Quarterly Report Pursuant to Section 13 or 15 (d) of the
Securities Exchange Act of 1934
For the Quarterly period ended January 30, 1998
OR
[ ] Transition Report Pursuant to Section 13 or 15(d) of the
Securities Act of 1934
For the transition period from to
Commission file number 1-6711
OEA, INC.
- ---------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 36-2362379
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
P. O. Box 100488, Denver, Colorado 80250
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (303) 693-1248
(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
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
20,594,757 Shares of Common Stock at March 5, 1998.
Explanatory Note
This Form 10-Q/A2 is being filed solely to correct line item descriptions in the
Consolidated Condensed Statement of Cash Flows filed as part of Company's Form
10-Q/A on October 29, 1998.
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Index to Financial Statements Page No.
Consolidated Condensed Balance Sheets
January 30, 1998 (unaudited)
and July 31, 1997.............................. 3
Consolidated Condensed Statements
of Earnings (unaudited)
Three Months and Six Months
Ended January 30, 1998 and
January 31, 1997............................... 4
Consolidated Condensed Statements
of Cash Flows (unaudited) Six Months
Ended January 30, 1998 and
January 31, 1997............................... 5
Notes to Consolidated Condensed Financial
Statements (Unaudited)......................... 6
OEA, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands)
ASSETS
January July
30, 31,
1998 1997
--------- -------
Current Assets: (Unaudited)
Cash and Cash Equivalents $ 2,747 $ 4,138
Accounts Receivable, Net 48,926 45,099
Unbilled Costs and Accrued Earnings 4,189 4,062
Income Taxes Receivable 365 2,568
Inventories
Raw Material and Component Parts 41,470 39,786
Work-in-Process 23,637 21,107
Finished Goods 13,189 9,513
-------- ---------
78,296 70,406
Prepaid Expenses and Other 1,646 1,046
-------- ---------
Total Current Assets 136,169 127,319
-------- ---------
Property, Plant and Equipment 264,984 238,545
Less: Accumulated Depreciation 63,922 54,651
-------- ---------
Property, Plant and Equipment, 201,062 183,894
Net
Cash Value of Life Insurance 317 317
Long-Term Receivable 3,000 3,000
Investment in Foreign Joint Venture 2,323 2,323
Deferred Charges --- 13,527
Other Assets 1,218 1,176
-------- ---------
Total Assets $ 344,089 $ 331,556
======== ========
LIABILITIES AND STOCKHOLDERS EQUITY
Current Liabilities:
Accounts Payable $ 19,821 $ 27,043
Interest Payable 2,034 1,431
Accrued Expenses 5,541 6,251
Federal and State Income Taxes 1,306 1,306
-------- ---------
Total Current Liabilities 28,702 36,031
Long-term Bank Borrowings 128,000 93,200
Deferred Income Taxes 9,388 14,562
Other 985 985
-------- ---------
Total Liabilities 167,075 144,778
-------- ---------
Stockholders' Equity:
Common Stock - $.10 par value,
Authorized 50,000,000 shares:
Issued - 22,019,700 shares 2,202 2,202
Additional Paid-In Capital 13,144 12,956
Retained Earnings 166,727 176,547
Less: Cost of Treasury Shares, (2,169) (2,164)
1,442,943 and 1,467,531
Equity Adjustment from Translation (2,890) (2,763)
-------- ---------
Total Stockholders' Equity 177,014 186,778
-------- ---------
Total Liabilities and $ 344,089 $ 331,556
Stockholders' Equity ======== =========
OEA, INC.
CONSOLIDATED CONDENSED STATEMENTS OF
EARNINGS (Unaudited)
(in thousands, except share data)
Three Six
Months Months
Ended Ended
January January January January
30, 31, 30, 31,
1998 1997 1998 1997
--------- -------- --------- --------
Net Sales $ 59,414 $ 51,486 $ 116,749 $ 96,826
Cost of Sales 51,305 37,029 98,476 67,853
--------- -------- --------- --------
Gross Profit 8,109 14,457 18,273 28,973
General and Administrative Expenses 2,118 1,950 4,003 3,524
Research and Development Expenses 376 83 677 1,267
--------- -------- --------- --------
Operating Profit 5,615 12,424 13,593 24,182
Other Income (Expense):
Interest Income 69 63 200 108
Interest Expense (1,401) (3) (2,376) (16)
Other, Net (291) 174 (137) 60
--------- -------- --------- --------
(1,623) 234 (2,313) 152
--------- -------- --------- --------
Earnings Before Income Taxes 3,992 12,658 11,280 24,334
Federal and State Income Tax Expense 1,614 4,854 4,270 9,424
--------- -------- --------- --------
Net Earnings Before
Cumulative Effect of a
Change in Accounting $ 2,378 $ 7,804 $ 7,010 $ 14,910
Principle
Cumulative Effect of a Change in --- --- (10,040) ---
Accounting Principle
--------- -------- --------- --------
Net Earnings (Loss) $ 2,378 $ 7,804 $ (3,030) $ 14,910
======== ======== ======== ========
Earnings per Share Before Cumulative
Effect of a
Change in Accounting Principle:
Earnings per Share - Basic $ 0.12 $ 0.38 $ 0.34 $ 0.73
Earnings per Share -
Diluted $ 0.12 $ 0.38 $ 0.34 $ 0.72
Cumulative Effect of Change in
Accounting Principle:
Earnings (Loss) per Share - --- --- (0.49) ---
Basic
Earnings (Loss) per Share - --- --- (0.49) ---
Diluted
--------- -------- --------- --------
Net Earnings (Loss) per Share:
Earnings (Loss) per Share - $ 0.12 $ 0.38 $ (0.15) $ 0.73
Basic
Earnings (Loss) per Share - $ 0.12 $ 0.38 $ (0.15) $ 0.72
Diluted ======== ======== ======== ========
Weighted Average Number of Shares 20,576,208 20,541,348 20,566,693 20,531,781
Outstanding - Basic ======== ======== ======== ========
Weighted Average Number of Share 20,610,612 20,617,819 20,596,784 20,605,581
Outstanding - Diluted ======== ======== ======== ========
OEA, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
(in thousands)
Six
Months
Ended
January January
30, 31,
1998 1997
-------- ---------
Operating Activities:
Net Earnings $ (3,030) $ 14,910
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Undistributed earnings of foreign joint --- (301)
venture
Cumulative effect of a change in 10,040 ---
accounting principal
Depreciation and amortization 10,867 7,388
Increase in deferred compensation payable --- 61
Loss on disposal of property, plant and 3 ---
equipment
Changes in operating assets and liabilities:
Accounts receivable (3,758) (3,012)
Unbilled costs and accrued earnings (127) (617)
Inventories (7,883) (7,769)
Prepaid expenses and other (598) 19
Accounts payable and accrued (7,339) (6,378)
expenses
Income taxes payable 2,985 930
-------- ---------
Net cash provided by/(used in) 1,160 5,231
operating activities
Investing activities:
Capital expenditures (30,757) (38,931)
Proceeds from sale of property, plant, and 255 ---
equipment
Increase in deferred charges --- (3,920)
Increase in other assets, net (80) (23)
-------- ---------
Net cash used in investing (30,582) (42,874)
activities
Financing activities:
Purchases of common stock for treasury (43) (117)
Proceeds from issuance of treasury stock 226 359
Payment of dividends (6,791) (6,162)
Increase in borrowings, net 34,800 44,000
-------- ---------
Net cash provided by financing 28,192 38,080
activities
Effect of exchange rate (161) (179)
changes on cash
-------- ---------
Net increase/(decrease) in (1,391) 258
cash and cash equivalents
Cash and cash equivalents at beginning of 4,138 2,560
period
-------- ---------
Cash and cash equivalents at end of period $ 2,747 $ 2,818
======== =========
Notes to Consolidated Condensed Financial Statements (Unaudited)
Note 1 - Basis of Presentation
The unaudited financial statements furnished above have been restated to reflect
the early adoption of the AICPA's Statement of Position 98-5 "Reporting on the
Costs of Start-up Activities" (see Note 3 below). Additionally, the unaudited
financial statements reflect all other adjustments (consisting primarily of
normal recurring accruals) which are, in the opinion of OEA's management,
necessary for a fair statement of the results for the three-month and six-month
periods ended January 30, 1998.
Refer to the Company's annual financial statements for the year ended July 31,
1997, for a description of the accounting policies, which have been continued
without change, except for the Company's policy with respect to deferred
start-up costs, as discussed at Note 3 below. Also, refer to the footnotes with
those financial statements for additional details of the Company's financial
condition, results of operations, and changes in financial position. The details
in those notes have not changed, except as a result of normal transactions in
the interim.
Note 2 - Earnings per Share
In February 1997, the FASB issued Statement No. 128, Earnings per
Share. The statement simplifies the standards for computing
earnings per share ("EPS"), and requires the presentation of both
basic and diluted EPS on the face of the statement of earnings with
supplementary disclosures. Statement No. 128 became effective for
financial statements issued for periods ending after December 15,
1997, including interim periods. The Company has adopted Statement
No. 128 for the second quarter of fiscal 1998.
Earnings per share of common stock is computed on the basis of the weighted
average number of shares outstanding during the year. The dilutive effect on
reported basic earnings per share from the assumed exercise of stock options
outstanding was 34,404 shares for the three months ended January 30, 1998 and
30,091 shares for the six months ended January 30, 1998. The dilutive effects on
reported basic earnings per share were 76,471 and 73,800, respectively, for the
prior-year periods.
Note 3 - Start-up Costs
In April 1998, the American
Institute of Certified Public Accountants (AICPA) issued Statement of Position
98-5, "Reporting on the Costs of Start-up Activities." This Statement requires
entities to expense costs of start-up activities as they are incurred and to
report the initial adoption as a cumulative effect of a change in accounting
principle as described in Accounting Principles Board Opinion No. 20,
"Accounting Changes." Statement of Position No. 98-5 is effective for fiscal
years beginning after December 15, 1998. However, in July 1998 the Company
elected to adopt Statement of Position 98-5 retroactively to the first quarter
of fiscal 1998. This election required the restatement of fiscal 1998 quarterly
financial statements to reflect a $10 million cumulative effect of a change in
accounting principle in the first quarter and to expense start-up costs
previously capitalized during the year.
Note 4 - Recently Issued Pronouncements
In June 1997, the FASB issued Statement No. 130, Reporting
Comprehensive Income. The Statement establishes standards for reporting and
display of comprehensive income and its components in a full set of
general-purpose financial statements. Statement No. 130 will be effective for
fiscal years beginning after December 15, 1997. The Company will adopt Statement
No. 130 during the first quarter of fiscal year 1999, and does not expect the
impact to be material.
In June 1997, the FASB issued Statement No. 131, Disclosures about Segments of
an Enterprise and Related Information. The Statement requires public business
enterprises to report certain information about operating segments in complete
sets of financial statements of the enterprise and in condensed financial
statements of interim periods issued to shareholders. It also requires that
public business enterprises report certain information about their products and
services, the geographic areas in which they operate, and their major customers.
Statement No. 131 will be effective for fiscal years beginning after December
15, 1997. The Company will adopt Statement No. 131 in its fiscal year 1999.
Note 5 - Bank Borrowings
On December 18, 1996, the Company entered into an unsecured, four-year, $100
million Revolving Credit Agreement with a group of four banks. This agreement
was amended on September 10, 1997 to increase the revolving credit facility to
$130 million. The interest rate is .625% above the federal funds rate when total
indebtedness is equal to or less than 30% of total capitalization and increases
to .7% above the federal funds rate when total indebtedness exceeds 30% of total
capitalization. Additionally, the Company pays an annual fee equal to .125% of
the banks' total commitment. At the Company's discretion, it may convert all or
part of the total debt to Eurodollar or Alternate Base Rate loan(s). The credit
facility expires on December 18, 2000, and provides for annual twelve-month
extensions to the termination date. In addition to this facility, the Company
recently secured a $10 million line of credit with an interest rate of .8% above
the federal funds rate from two of the banks participating in the $130 million
revolving credit facility. At January 30, 1998, the total debt outstanding
related to these credit facilities was $128 million. All outstanding debt at
January 30, 1998 is classified as long-term since no portion is either due or
expected to be permanently repaid within the next twelve-month period.
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.
OEA, INC.
(Registrant)
October 29, 1998 /s/ J Thomas McConathy
Date J. Thompson McConathy
Vice President Finance
(Principal Financial and Accounting Officer)
October 29, 1998 /s/ Charles B Kafadar
Date Charles B. Kafadar
Chief Executive Officer
(Principal Executive Officer)