SECURITIES AND EXCHANGE COMMISSION
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Washington, D.C. 20549
FORM 8-K
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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 17, 2004
COMMISSION FILE NUMBER: 1-5555
WELLCO ENTERPRISES, INC.
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(Exact name of registrant as specified in charter)
NORTH CAROLINA 56-0769274
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(State of Incorporation) ( I.R.S. Employer Identification No.)
150 Westwood Circle, P.O. Box 188, Waynesville, NC 28786
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(Address of Principal Executive Office)
Registrant's telephone number, including area code 828-456-3545
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ITEM 12. Results of Operations and Financial Condition
The following information is furnished pursuant to Item 12, "Results of
Operations and Financial Condition."
On February 17, 2004, Wellco Enterprises, Inc. issued a press release regarding
its operating results for the six months ended January 3, 2004, the second
quarter of fiscal year 2004. A copy of this press release is attached hereto as
Exhibit 99(a).
Exhibit Index
99(a) Press release, dated: February 17, 2004, issued by Wellco Enterprises,
Inc.
SIGNATURE
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 hereunto duly authorized.
WELLCO ENTERPRISES, INC.
/s/ David Lutz
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David Lutz
President - Chief Executive Officer
Dated: February 17, 2004
Exhibit 99(a)
WELLCO ENTERPRISES, INC. ANNOUNCES OPERATING RESULTS
FOR THE FISCAL QUARTER AND SIX MONTHS ENDED JANUARY 3, 2004 AND ACTION TAKEN
AT BOARD OF DIRECTORS MEETING
Waynesville, North Carolina, February 17, 2004--Wellco Enterprises, Inc.
(AMEX-WLC) today reported net income for the six month period ended January 3,
2004 of $967,000, equivalent to basic earnings per share of $.82 ($.80 diluted),
from revenues of $20,006,000. This compares to net income after cumulative
effect of change in accounting principle of $230,000, equivalent to basic
earnings per share of $.20 ($.19 diluted), from revenues of $10,506,000 in the
prior year six month period ended December 28, 2002.
Compared to the prior period, total revenues in the current period increased by
$9,500,000. In late March, 2003, the Defense Supply Center Philadelphia (DSCP,
the Department of Defense agency with which the Company contracts for the
manufacture of combat boots) invoked its surge option under a contract. Invoked
in response to the need for desert boots used by U. S. Armed Forces personnel in
Iraq, the surge option requires Wellco to significantly increase its rate of
boot production. In the current period the Company shipped 126,000 more pairs of
combat boots than in the prior period. In addition, current period revenues
increased by $511,000 over the prior period for sales under a small contract
with DSCP to supply the Extreme Cold Weather (Mukluk) boots. During the current
period, revenues from the new Infantry Combat Boot (ICB) were only $95,000.
Revenues from technical assistance fees and equipment rentals from licensees,
which vary with licensee sales, were greater in the current period because of
increased sales of certain licensees.
Prior six-month period net income of $458,000 as previously reported has been
reduced by a $228,000 write-off of goodwill, originally recorded in the fourth
quarter of fiscal year 2003. Under the applicable accounting standard, this
write-off was recorded in the fourth quarter of fiscal year 2003, and interim
periods for fiscal year 2003 are restated to reflect the write-off in the first
quarter of that year.
For the three month period ended January 3, 2004 net income of $551,000,
equivalent to basic and diluted earnings per share of $.46, from revenues of
$11,389,000 for its fiscal quarter ended January 3, 2004 (current three month
period), the second quarter of the 2004 fiscal year. This compares with net
income of $64,000, equivalent to basic and diluted earnings per share of $.05,
from revenues of $5,248,000 in the prior year quarter ended December 28, 2002
(prior three month period).
Compared to the prior period, total revenues in the current period increased by
$6,141,000 (117%). In the current period the Company shipped 82,000 more pairs
of combat boots than in the prior period. In addition, current period revenues
increased by $108,000 over the prior period for sales under a small contract
with DSCP to supply the Extreme Cold Weather (Mukluk) boots. During the current
period, revenues from the Infantry Combat Boot (ICB) were $95,000.
At a February 17, 2004 meeting, the Wellco Board of Directors declared a cash
dividend of $.10 per share payable on April 2, 2004 to shareholders of record on
March 8, 2004.
Except for historical information, this Release includes forward-looking
statements that involve risks and uncertainties, including, but not limited to,
the receipt of contracts from the U. S. government and others, and the
performance thereunder, the ability to control costs under fixed price
contracts, the cancellation of contracts, and other risks detailed from time to
time in the Company's Securities and Exchange Commission filings, including Form
10-K for the year ended June 28, 2003. Those statements include, but may not be
limited to, all statements regarding intent, beliefs, expectations, projections,
forecasts, and plans of the Company and its management. Actual results may
differ materially from management expectations. The Company assumes no
obligations to update any forward-looking statements.
Contact:
Wellco Enterprises, Inc.
Waynesville, North Carolina
David Lutz, President and Chief Executive Officer
Phone: 828-456-3545, extension 102
WELLCO ENTERPRISES, INC.
CONSOLIDATED OPERATING RESULTS
(UNAUDITED)
(000's omitted except for per share amounts and number of shares)
Fiscal Three Months Ended Fiscal Six Months Ended
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January 3, December 28, January 3, December 28,
2004 2002 2004 2002
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Revenues $11,389 $5,248 $20,006 $10,506
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Operating Income 753 84 1,266 556
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Net Interest Income
(Expense) (36) (9) (61) (11)
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Income Before Income
Taxes 717 75 1,205 545
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Provision for Income
Tax 166 11 238 87
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Income before Cumulative
Effect of Change in
Accounting Principle 551 64 967 458
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Cumulative Effect of
Change in Accounting
Principle - - - (228)
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Net Income 551 64 967 230
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Basic, Before Cumulative
Effect $0.46 $0.05 $0.82 $0.39
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Cumulative Effect - - - ($0.19)
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Basic, After Cumulative
Effect $0.46 $0.05 $0.82 $0.20
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Diluted, Before Cumulative
Effect $0.46 $0.05 $0.80 $0.38
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Cumulative Effect - - - ($0.19)
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Diluted, After Cumulative
Effect $0.46 $0.05 $0.80 $0.19
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Weighted Average Number
of Common Shares Outstanding:
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For Basic Earnings
Per Share 1,185,746 1,184,931 1,185,746 1,183,857
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For Diluted Earnings
Per Share 1,208,260 1,212,891 1,202,048 1,216,723
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