UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 30, 1996
Commission file number 1-4416
SPS TECHNOLOGIES, INC.
(Exact name of Registrant as specified in its Charter)
PENNSYLVANIA 23-1116110
(State of incorporation) (I.R.S. Employer
101 Greenwood Avenue, Suite 470 Identification No.)
Jenkintown, Pennsylvania 19046
(Address of principal executive offices) (Zip Code)
(215) 517-2000
(Registrant's telephone number, including area code)
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 Registrant's Common Stock
outstanding on November 4, 1996 was 5,996,661.
1
SPS TECHNOLOGIES, INC. AND SUBSIDIARIES
PART 1
FINANCIAL INFORMATION
Item 1. Index to Financial Statements
Page
Condensed Statements of Consolidated Operations -
Three and Nine Months Ended September 30, 1996
and 1995 (Unaudited) 3
Condensed Consolidated Balance Sheets -
September 30, 1996 and December 31, 1995
(Unaudited) 4, 5
Condensed Statements of Consolidated Cash Flows -
Nine Months Ended September 30, 1996 and 1995
(Unaudited) 6
Notes to Condensed Consolidated Financial Statements 7-11
2
SPS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF CONSOLIDATED OPERATIONS
(Unaudited-Thousands of dollars except share data)
Three Months Ended Nine Months Ended
September 30, September 30,
1996 1995 1996 1995
Net sales $ 125,435 $ 100,500 $ 360,712 $ 303,513
Cost of goods sold 99,734 80,300 287,236 247,295
Gross profit 25,701 20,200 73,476 56,218
Selling, general and
administrative expense 16,463 12,890 45,018 36,703
Operating earnings 9,238 7,310 28,458 19,515
Other income (expense):
Interest income 180 122 285 388
Interest expense (2,290) (1,654) (5,530) (4,834)
Equity in earnings
of affiliates 410 337 764 1,351
Minority interest (182) (290)
Other, net 144 (50) (377) (200)
(1,738) (1,245) (5,148) (3,295)
Earnings before income taxes 7,500 6,065 23,310 16,220
Provision for income taxes 1,460 1,880 6,210 5,060
Net earnings $ 6,040 $ 4,185 $ 17,100 $ 11,160
Earnings per common share
and common share equivalent $ .96 $ .70 $ 2.72 $ 1.90
Weighted average number of
common shares used to compute
earnings per share 6,316,870 5,983,229 6,288,155 5,862,123
See accompanying notes to condensed consolidated financial statements.
3
SPS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited-Thousands of dollars)
September 30, December 31,
1996 1995
Assets
Current assets
Cash and cash equivalents $ 28,257 $ 8,093
Accounts and notes receivable,
less allowance for doubtful
receivables of $1,566 (1995-$1,292) 80,989 61,294
Inventories 98,789 88,090
Deferred income taxes 16,108 16,396
Prepaid expenses 2,800 3,103
Net assets held for sale 1,600 2,362
Total current assets 228,543 179,338
Investments in affiliates 4,855 4,516
Property, plant and equipment, net of
accumulated depreciation of $130,910
(1995-$118,120) 138,167 112,738
Other assets 39,043 25,495
Total assets $ 410,608 $ 322,087
See accompanying notes to condensed consolidated financial statements.
4
SPS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited-Thousands of dollars, except share data)
September 30, December 31,
1996 1995
Liabilities and shareholders' equity
Current liabilities
Notes payable and current portion of
long-term debt $ 8,292 $ 6,578
Accounts payable 34,692 28,041
Accrued expenses 46,001 39,545
Income taxes payable 3,502 3,267
Total current liabilities 92,487 77,431
Deferred income taxes 14,001 13,061
Long-term debt 103,767 58,119
Retirement obligations 28,520 27,827
Minority interest 4,415
Shareholders' equity
Preferred stock, par value $1 per share,
authorized 400,000 shares, issued none
Common stock, par value $1 per share,
authorized 30,000,000 shares,
issued 6,628,942 shares (6,450,909
shares in 1995) 6,629 6,451
Additional paid-in capital 81,978 74,685
Retained earnings 95,691 78,591
Minimum pension liability (2,626) (2,626)
Common stock in treasury, at cost,
643,381 shares (599,258 shares in 1995) (7,801) (4,846)
Cumulative translation adjustments (6,453) (6,606)
Total shareholders' equity 167,418 145,649
Total liabilities and
shareholders' equity $ 410,608 $ 322,087
See accompanying notes to condensed consolidated financial statements.
5
SPS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS
(Unaudited-Thousands of dollars)
Nine Months Ended
September 30,
1996 1995
Net cash provided by operating activities $ 28,853 $ 14,134
Cash flows provided by (used in) investing
activities
Additions to property, plant and equipment (18,233) (14,027)
Proceeds from sale of property, plant
and equipment 527 578
Payments for businesses acquired, net of
cash acquired (29,191) (10,800)
Net cash used in investing activities (46,897) (24,249)
Cash flows provided by (used in) financing
activities
Proceeds from borrowings 140,622 20,000
Reduction of borrowings (104,532) (14,924)
Proceeds from exercise of stock options 2,079 972
Net cash provided by financing activities 38,169 6,048
Effect of exchange rate changes on cash 39 107
Net increase (decrease) in cash and cash
equivalents 20,164 (3,960)
Cash and cash equivalents at
beginning of period 8,093 9,472
Cash and cash equivalents at
end of period $ 28,257 $ 5,512
Significant noncash investing and
financing activities:
Debt assumed for businesses acquired $ 8,121
Purchase of treasury shares in connection
with the exercise of stock options $ 3,133
See accompanying notes to condensed consolidated financial statements.
6
SPS TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited-Thousands of dollars except share data)
1. Financial Statements
In the opinion of the Company's management, the
accompanying unaudited, condensed consolidated financial
statements contain all adjustments necessary to present
fairly the financial position as of September 30, 1996, the
results of operations for the three and nine-month periods
ended September 30, 1996 and 1995, and cash flows for the
nine-month periods ended September 30, 1996 and 1995. The
December 31, 1995 condensed balance sheet data was derived
from audited financial statements, but does not include all
disclosures required by generally accepted accounting
principles. The accompanying financial statements contain
only normal recurring adjustments. All financial
information has been prepared in conformity with the
accounting principles reflected in the financial statements
included in the 1995 Annual Report filed on Form 10-K
applied on a consistent basis.
2. Business Acquisitions
All acquisitions have been accounted for under the
purchase method. The results of operations of the acquired
businesses are included in the consolidated financial
statements from the dates of acquisition.
On July 3, 1996, the Company acquired all of the
outstanding shares of Swift Levick Magnets Ltd. (Swift
Levick), a manufacturer of permanent magnets, located in
Derbyshire, England for $18,100. The excess of the purchase
price over the fair values of the net assets acquired was
approximately $500 and has been recorded as goodwill, which
is being amortized on a straight-line basis over 30 years.
On June 14, 1996, the Company acquired all of the
outstanding shares of Flexmag Industries, Inc. (Flexmag), a
manufacturer of flexible bonded magnets, located in
Marietta, Ohio, and the assets and business of a related
injection molded magnets business located in Seneca, South
Carolina, for $21,000. The excess of the purchase price
over the fair values of the net assets acquired was
approximately $12,700 and has been recorded as goodwill,
which is being amortized on a straight-line basis over 30
years.
7
In the first quarter of 1996, the Company formed a
joint venture in China by acquiring a 55 percent interest in
Shanghai SPS Biao Wu Fasteners Co. Ltd. (SSBW). The Company
contributed cash of $2,150 and manufacturing technology with
an assigned value of $900 during the first nine months of
1996 for SSBW. The Company will additionally contribute
approximately $2,450 in cash, equipment and certain
manufacturing technology.
On August 16, 1995, the Company acquired approximately
48 percent of the outstanding stock of Metalac S.A.Industria
e Comercio (Metalac) located in Sao Paulo, Brazil. With
this acquisition, the Company increased its ownership to
approximately 95 percent. Metalac is a leading manufacturer
and distributor of industrial and automotive fasteners in
Brazil. The Company paid $4,000 in cash and issued 141,666
shares of the Company's common stock (approximate market
value on August 16, 1995 of $5,667). The Stock Purchase
Agreement also provides for additional payments contingent
on the future earnings performance of Metalac. Any
additional payments made, when the contingency is resolved,
will be accounted for as additional costs of the acquired
assets and amortized over the remaining life of the assets.
Prior to this acquisition, the Company accounted for its
investment in Metalac using the equity method.
On June 30, 1995, the Company paid approximately
$1,000 to increase its ownership in Unbrako K.K. from 50
percent to 100 percent. Unbrako K.K., located in Tokyo,
Japan, is a distributor of the Company's Unbrako and
aerospace products in the Japanese market. On March 3,
1995, the Company also acquired certain assets of Harvard
Industries, Inc.'s Elastic Stop Nut Division (ESNA). The
Company paid $6,200 in 1995 (of which, $5,700 was paid as
of September 30, 1995) to acquire, relocate and prepare
these assets for their intended use. The ESNA assets were
used by Harvard Industries, Inc. to manufacture aerospace
locknuts in Union, New Jersey.
The following unaudited pro forma consolidated results
of operations are presented as if the Swift Levick, Flexmag
and Metalac acquisitions had been made at the beginning of
the periods presented. The effects of the other
acquisitions (SSBW, Unbrako K.K. and ESNA) are not material
and, accordingly, have been excluded from the pro forma
presentation.
8
Nine Months Ended
September 30,
1996 1995
Net sales $380,801 $354,572
Net earnings 17,439 12,317
Earnings per common share
and common share equivalent 2.78 2.06
The pro forma consolidated results of operations
include adjustments to give effect to amortization of
goodwill, interest expense on acquisition debt and certain
other adjustments, together with related income tax effects.
The unaudited pro forma information is not necessarily
indicative of the results of operations that would have
occurred had the purchase been made at the beginning of this
period or the future results of the combined operations.
3. Inventories
September 30, December 31,
1996 1995
Finished goods $48,144 $45,933
Work-in-process 25,804 20,095
Raw materials
and supplies 18,315 14,330
Tools 6,526 7,732
$98,789 $88,090
The September 30, 1996 inventory balances include
$8,600 of inventory from businesses acquired in 1996.
4. Long-Term Debt
On June 17, 1996, the Company completed a new long term
Note Purchase Agreement with three insurance companies.
Under this new agreement, the Company borrowed $85,000 at
fixed interest rates of 7.70 percent to 7.88 percent due in
annual installments from July 1, 2001 to July 1, 2011 (the
average fixed interest rate is 7.83 percent and the average
maturity is approximately 11 years). The Notes Payable to
Insurance Companies, which provided for a fixed interest
rate of 9.45 percent, described in the Annual Report on Form
10-K for year ended December 31, 1995 were paid and canceled
with proceeds from the new Note Purchase Agreement. The
proceeds from the new agreement were also used to reduce
debt borrowed under the current Bank Credit Agreement and to
fund recent acquisitions.
9
The Company is subject to a number of restrictive
covenants under its various debt agreements. These
covenants, among other things, set forth limitations on
indebtedness, restrict the payment of cash dividends and
require the Company to maintain a minimum consolidated
tangible net worth, a minimum consolidated fixed charge
coverage ratio and a minimum consolidated current ratio.
Certain of the Company's debt agreements contain cross
default and cross acceleration provisions. Under these
covenants, the Company is permitted to declare dividends not
exceeding $7,500 plus 50 percent of consolidated net income
(or minus 100 percent of any consolidated net loss).
5. Environmental Contingency
The Company has been identified as a potentially
responsible party by various federal and state authorities
for clean up or removal of waste from various disposal
sites. At September 30, 1996, the accrued liability for
environmental remediation represents management's best
estimate of the costs related to environmental remediation
which are considered probable and can be reasonably
estimated. The Company has not included any insurance
recovery in the accrued environmental liability. The
measurement of the liability is evaluated quarterly based on
currently available information. As the scope of the
Company's environmental liability becomes more clearly
defined, it is possible that additional reserves may be
necessary. Accordingly, it is possible that the Company's
results of operations in future quarterly or annual periods
could be materially affected. However, management believes
that the overall costs of environmental remediation will be
incurred over an extended period of time and, as a result,
are not expected to have a material impact on the
consolidated financial position of the Company.
6. Income Taxes
For the nine months ended September 30, 1996, the
effective tax rate is lower than the statutory tax rate
because the Company revised its estimates related to the
future realization of tax benefits related to its deferred
tax assets. As a result, the provision for income taxes was
reduced by $1,700 in the third quarter.
10
The Company has recorded a net deferred tax asset at
September 30, 1996, which includes a partial benefit related
to the United States net operating loss carry forward (NOL).
Realization of the net deferred tax asset is dependent on
generating sufficient taxable income prior to expiration of
the NOL. Although realization is not assured, management
believes it is more likely than not that the recorded net
deferred tax asset will be realized.
7. Earnings Per Share
Earnings per share is computed by dividing net earnings
by the weighted average number of common shares outstanding.
When dilutive, stock options are included as common share
equivalents using the treasury stock method.
8. Subsequent Event
On October 8, 1996, the Company acquired 85 percent of
the capital stock of Mecair Aerospace Industries, Inc., a
manufacturer of aerospace fasteners, located in Pointe-
Claire (Montreal), Quebec, Canada for approximately $8,200.
This acquisition will be accounted for under the purchase
method. The results of operations of the acquired business
will be included in the consolidated financial statements
from the date of acquisition.
11
SPS TECHNOLOGIES, INC. AND SUBSIDIARIES
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Introduction
The Company's operating results for 1996 have improved over
the corresponding periods in 1995. The improvement in the
operating results for the third quarter and nine months to date
was due to the continued increase in the operating performance of
the Aerospace Products Division and the inclusion of the
businesses acquired in 1996. The Company's sales, orders and
backlog also improved in 1996.
Sales and Operating Earnings by Segment
(Unaudited-Thousands of dollars)
Three Months Ended Nine Months Ended
September 30, September 30,
1996 1995 1996 1995
Net sales:
Fasteners $ 84,549 $ 66,576 $ 248,704 $200,751
Materials 40,886 33,924 112,008 102,762
$125,435 $100,500 $ 360,712 $303,513
Operating earnings:
Fasteners $ 6,344 $ 4,862 $ 19,880 $ 12,233
Materials 4,747 4,568 14,413 13,182
Unallocated corporate (1,853) (2,120) (5,835) (5,900)
costs
$ 9,238 $ 7,310 $ 28,458 $ 19,515
Net Sales
Net sales increased $24.9 million, or 24.8 percent, in the
third quarter of 1996 and $57.2 million, or 18.8 percent, for the
nine month period ended September 30, 1996 compared to the same
periods in 1995.
Fastener segment sales increased $18.0 million, or 27.0
percent, in the third quarter of 1996 and $48.0 million, or 23.9
percent, for the nine month period. The Company's aerospace
fastener sales were up 29.4 percent to $40.3 million in the third
quarter and 27.1 percent to $119.1 million for the nine month
period. These increases are the result of improving demand in
the aerospace market. Based on commerical aircraft production
12
projections by the major aircraft manufacturers, the Company
expects this trend of improving demand for aerospace fasteners to
continue into 1997 and 1998. The Company is investing in
infrastructure to increase capacity to support this projected
expansion.
Sales by Metalac S.A. Industria e Comercio (Metalac) in
Brazil (acquired on August 16, 1995), Unbrako K.K. in Japan
(acquired on June 30, 1995) and Shanghai SPS Biao Wu Fasteners
Co. Ltd. (SSBW) in China (a joint venture formed on January 1,
1996) were $13.8 million in the third quarter of 1996 and $31.7
million for the nine months ended September 30, 1996. Excluding
the sales of these businesses, the Company's industrial fastener
sales increased $200 thousand, or 1.3 percent, in the third
quarter and $1.5 million, or 3.2 percent, for the nine month
period; while the Unbrako fastener sales decreased $1.5 million,
or 9.5 percent, in the third quarter and $7.2 million, or 14.1
percent, for the nine month period. The decline in Unbrako sales
is attributed to inventory reduction programs by distributors,
competitive pricing conditions and weak demand in European
markets.
Excluding the sales of the two magnetic material businesses
acquired in 1996 (Flexmag Industries, Inc. and Swift Levick
Magnets, Ltd.), the materials segment sales decreased by $2.3
million, or 6.8 percent, in the third quarter and remained level
for the nine month period. Sales of magnetic materials decreased
by $3.8 million, or 20.1 percent, in the third quarter and $5.1
million, or 11.1 percent, for the nine month period. Sales of
magnetic materials continue to be adversely affected by the
decreased demand from the automotive, telecommunications, and
personal computer markets. Sales of superalloys increased by
$1.5 million, or 10.1 percent, in the third quarter and $5.1
million, or 11.1 percent,for the nine month period. Increased
sales of superalloys is due primarily to higher sales of vacuum
melt alloy products manufactured for aerospace applications.
Sales of stainless steel and cobalt-based alloys also increased
from prior year levels.
Operating Earnings
Operating earnings of the fastener segment improved by $1.5
million in the third quarter and $7.7 million for the nine month
period. The improvement in earnings is attributed to increased
sales of aerospace fasteners and cost reductions attributed to
the Company's investment in new state-of-the-art computer
controlled machine tools. The operating earnings from Unbrako
K.K. and SSBW, two companies acquired after June 30, 1995, also
contributed to this increase.
13
In response to the decline in industrial and Unbrako
fastener sales in the European and Brazilian markets, the Company
restructured its manufacturing operations in Shannon, Ireland;
Coventry, England and Sorocaba, Brazil in the third quarter of
1996. As a result, the Company recorded a charge for the cost of
employee separations of $2.1 million in the third quarter which
has been included in Selling, General and Administrative Expense.
This action, which reduced the number of employees by 66, is
expected to lower future operating costs at these locations by
approximately $2.4 million per year.
Excluding the operating earnings of the two magnetic
material businesses acquired in 1996, the operating earnings of
the materials segment decreased by $1.2 million, or 25.2 percent,
in the third quarter and $200 thousand, or 1.6 percent, for the
nine month period. Operating earnings of the materials segment
were adversely affected by the decline in the magnetic material
sales.
Other Expense
Interst expense increased from $4.8 million for the first
nine months of 1995 to $5.5 million for the first nine months of
1996. Higher levels of debt increased interest expense by
approximately $900 thousand, but lower interest rates caused
interest to decrease by $200 thousand. Income from the equity in
earnings of affiliates decreased from $1.4 million in the nine
month period ended September 30, 1995 to $764 thousand in the
nine month period ended September 30, 1996. As discussed in Note
2 to the financial statements, the Company increased its
ownership interest in Metalac and Unbrako K.K. in August and June
of 1995, respectively. Prior to these acquisition dates, the
Company accounted for its investment in these companies using the
equity method. The increase in "other, net" expense is
attributed to the write off of deferred financing costs related
to the early retirement of certain debt (see Note 4 to the
financial statements).
Net Earnings
The Company recorded third quarter 1996 net earnings of $6.0
million or $.96 per share, compared to net earnings of $4.2
million or $.70 per share for the third quarter of 1995. Net
earnings were $17.1 million or $2.72 per share for the nine
months ended September 30, 1996 compared to $11.2 million or
$1.90 per share in 1995.
14
Orders and Backlog
Incoming orders for the third quarter of 1996 were $129.0
million compared to $110 million in 1995, a 17 percent increase.
Incoming orders for the nine months ended September 30, 1996 were
$382.9 million compared to $345.9 million for the same period in
1996, an 11 percent increase. The increase in orders is
attributed to an increase in orders received by the Aerospace
Products Division ($5.7 million for the quarter and $22.1 million
for the nine month period) and orders received by Metalac,
Flexmag and Swift Levick ($15.6 million for the quarter and $28.9
million for the nine month period). Partially offsetting these
increases were a decrease in orders received for Unbrako Products
sold in North America and Europe ($1.1 million for the quarter
and $13.3 million for the nine month period) and the decrease in
orders received for magnetic materials manufactured by the Arnold
Engineering Company ($3.3 million for the quarter and $14.3
million for the nine month period). Backlog at September 30,
1996 was $169.1 million, compared to $144.7 million on the same
date a year ago and $136.5 million at December 31, 1995.
Acquisitions
In 1996, the Company increased its investment in the
magnetic materials business of its materials segment by acquiring
certain businesses to be combined with the Company's subsidiary,
The Arnold Engineering Co. (Arnold), a leading manufacturer of
magnetic materials and components. As discussed in Note 2 to the
financial statements, the Company acquired all of the outstanding
shares of Flexmag Industries, Inc. (Flexmag), a manufacturer of
flexible bonded magnets, located in Marietta, Ohio and the assets
and business of a related injection molded magnetics business
located in Seneca, South Carolina, for $21 million on June 14,
1996. In 1995, these businesses had sales of approximately $18.8
million. This acquisition will further expand Arnold's product
lines into markets that the Company believes have attractive
growth potential. As discussed in Note 2 to the financial
statements, the Company acquired all of the outstanding shares of
Swift Levick Magnets Ltd.(Swift Levick), located in Derbyshire,
England for $18.1 million on July 3, 1996. Swift Levick is a
European manufacturer of permanent magnets with 1995 sales of
approximately $20 million. The acquisition of Swift Levick
represents a significant opportunity for Arnold to expand sales
into European markets.
15
As discussed in Note 8 to the financial statements, on
October 8, 1996 the Company acquired 85 percent of the capital
stock of Mecair Aerospace Industries, Inc., a manufacturer of
aerospace fasteners, located in Pointe-Claire (Montreal), Quebec,
Canada for approximately $8.2 million. Mecair is a manufacturer
of high strength fasteners and precision components for
commercial and military aircraft and for land-based power
generation systems with 1995 sales of approximately $5.6 million.
The acquisition of Mecair will augment the Company's efforts to
increase aerospace fastener capacity.
Liquidity and Capital Resources
Management considers liquidity to be the ability to generate
adequate amounts of cash to meet its needs and capital resources
to be the resources from which such cash can be obtained,
principally from operating and external sources. The Company
believes that capital resources available to it will be
sufficient to meet the needs of its business, both on a short-
term and long-term basis.
Cash flow provided by, or used in operating activities,
investing activities and financing activities is summarized in
the condensed statements of consolidated cash flows. Net cash
provided by operating activities increased by $14.7 million
compared to the first nine months of 1995 primarily due to the
$5.9 million improvement in net earnings and the $8.6 million
decrease in the use of cash to increase working capital.
Consistent with the increase in sales and orders received in the
first nine months of 1996, the Company reported higher levels of
accounts receivable and inventory compared to the December 31,
1995 condensed consolidated balance sheet. The 1996 acquisitions
of SSBW, Flexmag and Swift Levick also contributed to higher
levels of working capital on the September 30, 1996 condensed
consolidated balance sheet.
The increase in cash used in investing activities is
attributed to the 1996 payment for Flexmag ($20 million) and
Swift Levick ($10.3 million) compared to the 1995 payments for
the Elastic Stop Nut Division of Harvard Industries, Inc. ($5.7
million) and the Company's increase in ownership interest in
Unbrako K.K. ($1 million) and Metalac ($4.1 million).
Additionally, the Company spent $18.2 million for capital
expenditures in the first nine months of 1996 compared to $14
million in the same period of 1995. The Company expects to
invest $26 million in capital for the full year of 1996, as
reported on Form 10-K for the year ended December 31, 1995.
16
The Company's total debt to equity ratio was 67 percent at
September 30, 1996, compared to 44 percent at December 31, 1995.
Total debt was $112.1 million at September 30, 1996 and $64.7
million at December 31, 1995. As of September 30, 1996, under
the terms of the existing credit agreements, the Company is
permitted to incur an additional $40 million in debt. As
discussed in Note 4 to the financial statements, the Company
completed a new long term Note Purchase Agreement in the amount
of $85 million at an average fixed rate of 7.83 percent and an
average maturity of 11 years. Proceeds were used to reduce
certain bank borrowings and existing long term debt and to fund
recent acquisitions.
17
SPS TECHNOLOGIES, INC. AND SUBSIDIARIES
PART II
OTHER INFORMATION
Item 4. Submission of Matters to Vote of Security Holders
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
11 Computation of Earnings Per Share Statement.
(b) No reports on Form 8-K were filed during the quarter ended
September 30, 1996.
18
SPS TECHNOLOGIES, INC. AND SUBSIDIARIES
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.
SPS TECHNOLOGIES, INC.
(Registrant)
Date: November 6, 1996 /s/William M. Shockley
William M. Shockley
Vice President, Chief
Financial Officer and
Controller
Mr. Shockley is signing on behalf of the registrant and as the
Chief Financial Officer of the registrant.
19
SPS TECHNOLOGIES, INC. AND SUBSIDIARIES
EXHIBIT INDEX
PAGE
Exhibit 11 - Computation of Earnings Per Share
Statement 21,22
20