UNITED STATES
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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 15, 2006
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
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
SECTION 2 Financial Information
ITEM 2.02 Results of Operations and Financial Condition
On February 15, 2006, Wellco Enterprises, Inc. issued a press release announcing
the financial results for the second quarter ended December 31, 2005 and cash
dividend declaration. A copy of Wellco Enterprises, Inc. press release is
attached as Exhibit 99(a) to this report and incorporated by reference.
The information furnished pursuant to this Item 2.02 and the exhibit hereto
shall not be deemed "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and shall not be deemed
to be incorporated by reference in any filing under the Securities Act of 1933,
as amended, or the Exchange Act except as shall be expressly set forth by
specific reference in such filing.
Exhibit Index
99(a) Press release, dated: February 15, 2006 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/ Tammy Francis____________________
Tammy Francis
Treasurer - Chief Financial Officer
Dated: February 15, 2006
Exhibit 99(a)
WELLCO ENTERPRISES, INC. ANNOUNCES OPERATING RESULTS
FOR THE FISCAL QUARTER AND SIX MONTHS ENDED DECEMBER 31, 2005 AND
CASH DIVIDEND
Waynesville, North Carolina, February 15, 2006--Wellco Enterprises, Inc.
(AMEX-WLC) today reported net income for the second fiscal quarter ended
December 31, 2005 of its 2006 fiscal year (current three month period) of
$225,000, equivalent to basic earnings per share of $.18 ($.17 diluted), from
revenues of $11,041,000. This compares to net income of $521,000, equivalent to
basic earnings per share of $.41 ($.40 diluted), from revenues of $14,358,000 in
the prior year three month period ended January 1, 2005 (prior three month
period).
Compared to the prior three month period, total revenues in the current three
month period decreased by $3,317,000. In the current three month period, pairs
of boots shipped under U. S. Department of Defense (DOD) contracts decreased by
23%. In early August 2005, the only U.S. supplier of a DOD required component
had a quality problem that significantly impaired production volume. Although
this problem was substantially resolved in late September 2005, production and
shipments in the early part of the current three month period were also impaired
by the time required to reestablish an adequate supply of this component.
The majority of the Company's boot manufacturing operations occur at the factory
of a wholly-owned subsidiary located in Puerto Rico. The Company is
participating in a Puerto Rican government program to assist manufacturers in
the training of new or expanded work force under which the Company is reimbursed
for part of the compensation paid to certain employees. Under this program, the
Company received and recognized as revenues in the current three month period
$381,000, compared to $384,000 in the prior three month period. The Company's
policy is to record these reimbursements in the fiscal period in which they are
received. The Company has filed reimbursement claims totaling $840,000 at
December 31, 2005, that have not been received or recorded as revenues.
For the six month period ended December 31, 2005 (current six month period) the
Company had a net loss of ($421,000), equivalent to basic and diluted loss per
share of ($.33), from revenues of $19,359,000. This compares with net income of
$918,000, equivalent to basic earnings per share of $.73 ($.70 diluted), from
revenues of $25,760,000 in the prior year six months ended January 1, 2005
(prior six month period).
Compared to the prior six month period, total revenues in the current six month
period decreased by $6,401,000. In the current six-month period, pairs of boots
shipped under U. S. Department of Defense (DOD) contracts decreased by 33%. This
decrease was caused by the supplier component problem mentioned above and to the
Iraq surge being substantially completed in the prior period. Reimbursement of
compensation cost under the Puerto Rican government program was $381,000,
$784,000 less than the $1,165,000 received and recognized in the prior year six
month period.
At a February 14, 2006 meeting, the Wellco Board of Directors declared a cash
dividend of $.15 per share payable on March 31, 2006 to shareholders of record
on March 3, 2006.
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING INFORMATION
Statements throughout this report that are not historical facts are
forward-looking statements. These statements are based on current expectations
and beliefs, and involve numerous risks and uncertainties. Many factors could
affect the Company's actual results, causing results to differ materially from
those expressed in any such forward-looking information.
These factors include, but are not limited to, the receipt of contracts from the
U. S. government 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 July 2, 2005. 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 obligation 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
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CONSOLIDATED OPERATING RESULTS
(000'S OMITTED EXCEPT FOR PER SHARE AMOUNTS AND NUMBER OF SHARES)
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(unaudited) (unaudited)
Fiscal Three Months Ended Fiscal Six Months Ended
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December 31, January 1, December 31, January 1,
2005 2005 2005 2005
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Revenues $11,041 $14,358 $19,359 $25,760
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Operating Income (Loss) 301 764 (330) 1,310
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Interest Expense (66) (89) (109) (137)
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Income (Loss) Before
Income Taxes 235 675 (439) 1,173
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Income Tax Provision
(Benefit) 10 154 (18) 255
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Net Income (Loss) 225 521 (421) 918
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Basic Earnings (Loss) Per
Share $.18 $.41 ($.33) $.73
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Diluted Earnings (Loss) Per
Share $.17 $.40 ($.33) $.70
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Weighted Average Number of
Common Shares Outstanding:
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For Basic Earnings (Loss)
Per Share 1,270,746 1,266,402 1,270,746 1,257,092
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For Diluted Earnings (Loss)
Per Share 1,292,157 1,303,970 1,270,746 1,312,888
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