SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
---------------------
FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) June 15, 1994
Moog Inc.
(Exact Name of Registrant as Specified in Charter)
New York 1-5129 16-0757636
(State or Other (Commission (IRS Employer
Jurisdiction of File Number) Indentification
No.)
Incorporation)
East Aurora, NY 14052
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code 716) 652-2000
N/A
(Former Name or Former Address, if Changed Since Last Report)
1
Item 7. Financial Statements, Pro Forma Financial Page
Information and Exhibits.
The following financial statements and pro
forma financial information are filed as a
part of this report.
(A) Financial Statements of AlliedSignal
Mechanical and Hydraulic Actuation
Division 3
(i) Audited Financial Statements for
the years ended December 31, 1993
and 1992 4-12
(ii) Unaudited Financial Statements
for the three and six months
ended March 31, 1994. 13-17
(B) Pro Forma Condensed Combined Financial
Statements of Moog Inc. and the
AlliedSignal Mechanical and Hydraulic
Actuation Division 18
(i) Pro Forma Condensed Combined
Statement of Operations for the six
months ended March 31, 1994 20
(ii) Pro Forma Condensed Combined
Statement of Operations for
the year ended September 30,
1993 21
(iii) Pro Forma Condensed Combined
Balance Sheet as of March 31,
1994 22
(iv) Notes to Pro Forma Condensed
Combined Financial Statements 24
(C) Exhibits
(23) Consent of Price Waterhouse LLP 26
2
AlliedSignal Mechanical and Hydraulic Actuation Division
(a division of AlliedSignal Inc.)
Report and Financial Statements
December 31, 1993 and 1992
3
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of
AlliedSignal Inc.
In our opinion, the accompanying balance sheet and the related
statements of operations and division equity and of cash flows
present fairly, in all material respects, the financial position
of the AlliedSignal Mechanical and Hydraulic Actuation Division
(a division of AlliedSignal Inc.) at December 31, 1993 and 1992,
and the results of its operations and its cash flows for each of
the two years in the period ended December 31, 1993, in
conformity with generally accepted accounting principles. These
financial statements are the responsibility of the Division's
management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our
audits in accordance with generally accepted auditing standards,
which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable
basis for our opinion.
PRICE WATERHOUSE LLP
July 22, 1994
Woodland Hills, California
4
AlliedSignal Mechanical and Hydraulic Actuation Division
(a division of AlliedSignal Inc.)
Balance Sheet (in thousands)
December 31,
1993 1992
Assets
Current assets:
Accounts receivable $ 9,863 $ 13,107
Inventories (Note 2) 17,953 20,792
Total current assets 27,816 33,899
Property and equipment, net (Notes 2 and 3) 45,489 49,383
Other assets 300 200
Total assets $ 73,605 $ 83,482
Liabilities and Division Equity
Current liabilities:
Accounts payable $ 4,200 $ 4,700
Accrued liabilities (Note 3) 14,212 23,531
Total current liabilities 18,412 28,231
Commitments and contingencies (Note 6)
Division equity (Note 5) 55,193 55,251
Total liabilities and division $ 73,605 $ 83,482
equity
See accompanying notes to financial statements
5
AlliedSignal Mechanical and Hydraulic Actuation Division
(a division of AlliedSignal Inc.)
Statements of Operations and Division Equity (in thousands)
For the year ended
December 31,
1993 1992
Net sales $101,547 $ 96,527
Cost of sales 78,512 90,472
Gross profit 23,035 6,055
Selling, general and administrative expense 17,060 18,156
Research and development expense 2,756 4,191
Operating income (loss) 3,219 (16,292)
Interest expense 1,812 2,571
Other expense, net 1,910 1,973
Loss before income taxes (503) (20,836)
Benefit for income taxes (Note 4) (201) (8,335)
Net loss (302) (12,501)
Net increase in intercompany account (Note 5) 244 21,286
Division equity, beginning of year 55,251 46,466
Division equity, end of year $55,193 $55,251
See accompanying notes to financial statements
6
Allied Mechanical and Hydraulic Actuation Division
(a division of AlliedSignal Inc.)
Statements of Cash Flows (in thousands)
For the year ended
December 31,
1993 1992
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (302) $(12,501)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation 5,688 4,690
Change in assets and liabilities:
Accounts receivable 3,244 (1,615)
Inventories 2,839 8,308
Other assets (100) (200)
Accounts payable (500) (5,400)
Accrued liabilities (9,319) (4,457)
Net cash provided by (used for)
operating activities 1,550 (11,175)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (1,794) (10,111)
CASH FLOWS FROM FINANCING ACTIVITIES:
Changes in intercompany accounts 244 21,286
Net change in cash - -
Cash, beginning of year - -
Cash, end of year $ - $ -
See accompanying notes to financial statements
7
AlliedSignal Mechanical and Hydraulic Actuation Division
(a division of AlliedSignal Inc.)
Notes to Financial Statements (in thousands)
1. Basis of presentation
The accompanying financial statements reflect the
assets, liabilities and division equity and the
revenues, expenses, changes in division equity and cash
flows of the AlliedSignal Mechanical and Hydraulic
Actuation Division (the Division), a wholly-integrated
line of business of Aerospace Systems & Equipment
(ASE), a division of AlliedSignal Inc. (AlliedSignal).
The Division designs, manufactures, markets and
supports actuation equipment for commercial and
military applications.
2. Summary of significant accounting policies
Inventories
Inventories, which include costs of material, labor and
manufacturing overhead, are stated at the lower of cost
(first-in, first-out) or market and consist of the
following:
1993 1992
Raw materials $ 590 $ 1,405
Work-in-process 13,067 15,995
Finished goods 10,347 8,674
24,004 26,074
Less: Unliquidated progress
payments (6,051) (5,282)
$ 17,953 $ 20,792
Property and equipment
Property and equipment are recorded at cost, less
accumulated depreciation and amortization. Depreciation is
computed by the straight-line method on the basis of the
estimated useful lives of the related assets. The Division
capitalizes expenditures which materially increase asset
lives and charges ordinary maintenance and repairs to
operations as incurred. When assets are retired or
otherwise disposed of, the cost of the assets and the
related accumulated depreciation are removed from the
respective accounting records and the resulting gain or loss
is included in operations.
8
AlliedSignal Mechanical and Hydraulic Actuation Division
(a division of AlliedSignal Inc.)
Notes to Financial Statements (in thousands)
Revenue recognition
Revenues are generally recognized as products are shipped to
customers. A portion of the Division's revenues results
from contracts performed for the United States government.
Revenues and profits on such contracts are recognized using
the units-shipped method of accounting. The Division
provides for anticipated losses on contracts by a charge to
income during the period in which the losses become evident;
contracts that are part of a program are evaluated on an
overall program basis. Contract costs, including indirect
costs allocated to contracts, are subject to audit and
adjustment by negotiations between the Division and the
United States government. Contract revenues have been
recorded in amounts which are expected to be realized upon
final settlement.
Warranty expense
The Division warrants its products against defects for
periods ranging from six months to three years. A provision
for estimated future costs relating to warranty expense is
recorded when products are shipped. Warranty expense was
$1,510 and $5,645 in 1993 and 1992, respectively.
Income taxes
For income tax purposes, the Division's taxable income
(loss) is included in the consolidated and combined tax
returns of AlliedSignal. AlliedSignal allocates a portion
of the consolidated income tax provision (benefit) to the
Division in an amount generally equivalent to the provision
(benefit) which would result if the Division filed a
separate income tax return, without regard to net operating
loss carryover limitations. Income taxes currently payable,
as allocated pursuant to this policy, and deferred income
taxes relating to temporary differences between the
financial statement and tax bases of assets are included in
division equity in the balance sheet.
Statement of cash flows
The Division paid no cash for interest or income taxes in
1993 and 1992.
9
AlliedSignal Mechanical and Hydraulic Actuation Division
(a division of AlliedSignal Inc.)
Notes to Financial Statements (in thousands)
3. Composition of certain balance sheet components
December 31,
1993 1992
Property and equipment
Land $ 4,574 $ 4,574
Buildings and improvements 17,406 17,005
Machinery and equipment 55,315 56,792
Construction in progress 421 1,686
77,716 80,057
Less accumulated depreciation
and amortization (32,227) (30,674)
$ 45,489 $ 49,383
Accrued liabilities
Payroll, benefits and related
taxes $ 3,700 $ 4,200
Customer advances 5,300 6,500
Customer refunds 300 4,300
Warranty 1,612 3,125
Streamlining and restructuring 2,206
Other 3,300 3,200
$ 14,212 $ 23,531
4. Income taxes
The benefit for income taxes for the years ended
December 31, 1993 and 1992 consist of the following:
1993 1992
Federal $ (161) $ (6,751)
State (40) (1,584)
$ (201) $ (8,335)
The reconciliation of the effective tax rate for the years
ended December 31, 1993 and 1992 is as follows:
1993 1992
Tax at statutory federal rate 34% 34%
State taxes, net of federal benefit 7% 7%
Other, net (1%) (1%)
40% 40%
10
AlliedSignal Mechanical and Hydraulic Actuation Division
(a division of AlliedSignal Inc.)
Notes to Financial Statements (in thousands)
5. Related party transactions
The Division is allocated amounts from ASE and AlliedSignal
for corporate overhead charges and income taxes (Notes 2 and
4). Corporate charges, which are allocated to the Division
based on specific identification, headcount, and certain
formulas, totalled $3,447 and $3,685 for the years ended
December 31, 1993 and 1992, respectively. Corporate charges
are included in general and administrative expenses in the
statement of operations. In the opinion of management, the
allocation methods are reasonable.
The Division is also charged interest in accordance with a
formula based on AlliedSignal's net investment in the
Division, cash flow generated by the Division, and other
factors. Interest expense totalled $1,812 and $2,571 for
the years ended December 31, 1993 and 1992, respectively.
Division equity includes AlliedSignal's investment in the
Division, net cash transfers between the Division and ASE
and AlliedSignal for cash generated from operations, and
cash transfers for working capital and asset purchases,
corporate charges and allocations and cumulative earnings of
the Division. Additionally, assets or liabilities related
to pension costs and postretirement benefits are included in
division equity.
The Division purchases certain components used in its
products from affiliates. Purchases from affiliates
totalled $1,662 and $1,910 for the years ended December 31,
1993 and 1992, respectively. In addition, the Division
sells certain manufactured hardware to affiliates. Sales to
affiliates totalled $12,320 and $10,600 for the years ended
December 31, 1993 and 1992, respectively.
6. Commitments and contingencies
Litigation
The Division is from time to time a party to various legal
actions and other claims which arise during the normal
course of business. In the opinion of management, the
resolution of these matters will not have a material adverse
effect on the Division's financial position or results of
operations.
11
AlliedSignal Mechanical and Hydraulic Actuation Division
(a division of AlliedSignal Inc.)
Notes to Financial Statements (in thousands)
Transactions with the United States government
In the normal course of the Division's contracting business,
issues are raised by government agencies involving cost
accounting methods, procurement practices, manufacturing
methodology, research activities, design and quality
standards, and a broad range of other issues. Resolution of
these issues may result in costs to the Division, including
delays in shipments and changes in manufacturing methods and
costs. In the opinion of management, the resolution of
these matters will not have a material adverse effect on the
Division's financial position or results of operations.
7. Revenues and accounts receivable
The Company generates revenues principally from the sales of
products to the aerospace industry. As a result, the
Company's trade accounts receivable are concentrated
primarily in this industry. The Company performs ongoing
credit evaluations of its customers and generally does not
require collateral.
Four customers accounted for 22%, 14%, 12% and 10% of
revenue, respectively, in 1993 and three customers accounted
for 31%, 16% and 12% of revenue, respectively, in 1992.
Foreign sales in 1993 and 1992 amounted to $20,353 and
$10,323, respectively.
8. Subsequent events
Effective June 17, 1994, the Division was sold to Moog, Inc.
for approximately $71 million. Approximately 500 employees
of ASE directly associated with the Division have
transferred to the acquiring company.
12
Unaudited Financial Statements of
AlliedSignal Mechanical and Hydraulic Actuation Division
(a division of AlliedSignal Inc.)
for the three and six months ended March 31, 1994
13
AlliedSignal Mechanical and Hydraulic Actuation Division
(a Division of AlliedSignal Inc.)
Balance Sheet (Unaudited)
March 31, 1994
(In thousands)
ASSETS
CURRENT ASSETS
Accounts receivables, net 7,800
Inventories 20,200
TOTAL CURRENT ASSETS 28,000
PROPERTY, PLANT AND EQUIPMENT, NET 43,990
OTHER ASSETS 300
TOTAL ASSETS $ 72,290
LIABILITIES AND DIVISION EQUITY
CURRENT LIABILITIES
Accounts payable 4,400
Accrued liabilities 6,500
Customer advances 2,800
TOTAL CURRENT LIABILITIES 13,700
Commitments and contingencies
DIVISION EQUITY 58,590
TOTAL LIABILITIES AND DIVISION EQUITY $ 72,290
See Notes to Financial Statements
14
AlliedSignal Mechanical and Hydraulic Actuation Division
(a Division of AlliedSignal Inc.)
Statements of Operations and Division Equity
(In thousands)
Periods Ended
March 31, 1994
(unaudited)
Three Months Six Months
Net sales $ 23,876 $ 48,026
Other income 109 140
23,985 48,166
Costs and Expenses
Cost of sales 16,127 33,571
Research and development expenses 576 1,214
Selling, general and administrative expenses 3,369 7,268
Interest expense 364 745
Other expenses 363 352
20,799 43,150
Earnings before income taxes 3,186 5,016
Income taxes 1,274 1,915
Net earnings 1,912 3,101
Net increase in intercompany account 1,485 698
Division equity at beginning of period 55,193 54,791
Division equity at end of period $ 58,590 $ 58,590
See Notes to Financial Statements
15
AlliedSignal Mechanical and Hydraulic Actuation Division
(a Division of AlliedSignal Inc.)
Statement of Cash Flows
(In thousands)
Periods Ended
March 31, 1994
(unaudited)
Three Months Six Months
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings $ 1,912 $ 3,101
Adjustments to reconcile net
earnings to net cash provided
by operating activities:
Depreciation 1,525 2,975
Changes in assets and liabilities:
Accounts receivables, net 2,063 300
Inventories (2,247) (200)
Other assets - (200)
Accounts payable 200 (800)
Accrued liabilities (2,412) (1,800)
Customer advances (2,500) (2,900)
Net cash provided (used) by operating
activities (1,459) 476
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant
and equipment (26) (1,174)
CASH FLOWS FROM FINANCING ACTIVITIES
Change in intercompany accounts 1,485 698
Net change in cash - -
Cash, beginning of period - -
Cash, end of period $ $ -
See Notes to Financial Statements
16
AlliedSignal Mechanical and Hydraulic Actuation Division
Notes to Financial Statements
(unaudited)
(dollars in thousands)
1. Basis of presentation
The accompanying financial statements reflect the assets,
liabilities and division equity and the revenues, expenses,
changes in division equity and cash flows of the
AlliedSignal Mechanical and Hydraulic Actuation Division
(the Division), a wholly-integrated line of business of
Aerospace Systems & Equipment (ASE), a division of
AlliedSignal Inc. (AlliedSignal). The Division designs,
manufactures, markets and supports actuation equipment for
commercial and military applications. In the opinion of the
Division, the accompanying financial statements contain all
adjustments necessary to present fairly the financial
position as of March 31, 1994 and the results of operations
and cash flows for the three and six month periods ended
March 31, 1994. The results of operations for the three and
six month periods ended March 31, 1994 are not necessarily
indicative of results expected for the full year.
2. Inventories
Inventories, which include costs of material, labor and
manufacturing overhead, are stated at the lower of cost
(first-in, first-out) or market and consist of the following
at March 31, 1994
Raw materials $ 700
Work-in-process 12,200
Finished goods 12,700
25,600
Less: Unliquidated progress payments (5,400)
$20,200
3. Statement of cash flows
The Division paid no cash for interest or income taxes
during the six months ended March 31, 1994
4. Subsequent events
Effective June 17, 1994, the Division was sold to Moog Inc.
for approximately $78,000 including payment for specified
transition services to be provided over a period of
approximately one year. Approximately 500 employees of ASE
directly associated with the Division have transferred to
the acquiring company.
17
MOOG, INC.
Pro Forma Condensed Combined Financial Statements
18
MOOG INC.
Pro Forma Condensed Combined Financial Statements
(In Thousands)
Introduction
On June 17, 1994 Moog Inc. (Moog) completed the purchase of
the Mechanical and Hydraulic Actuation Systems product lines (the
"Product Lines") from AlliedSignal Inc. (AlliedSignal). Included
in the purchase are all of the inventories, machinery and
equipment and real property associated with the Product Lines.
It is expected that these assets will continue to be used in the
operation of the acquired Product Lines. Moog Inc. assumed
certain contract related liabilities and other miscellaneous
accrued liabilities as part of the transaction. The original
purchase price, including payment for specified transition
services to be provided by AlliedSignal over a period of
approximately one year, was $78,000 in cash which was financed
under Revolving Credit and Term Loan facilities provided by a
banking group. Interest on borrowing will be charged at LIBOR
plus 2.12% for the first year and 2.00% thereafter. The final
purchase price has been adjusted downward to $74,352 based upon a
formula set forth in the stock purchase agreement which adjusted
the purchase price based upon the level of net assets forwarded
at closing.
The following unaudited pro forma condensed combined
financial statements give effect to the acquisition of the
Product Lines by Moog assuming the transaction was consummated as
of September 30, 1992. Included in the statement of operations
for the year ended September 30, 1993 is Moog's fiscal year ended
September 30, 1993 and the Product Lines' calendar year ended
December 31, 1993. The statement of operations for the six
months ended March 31, 1994 includes the actual six month periods
then ended for both entities. Sales of $24,181 and earnings
before cumulative effect of change in accounting principle of
$1,189 for the Product Lines' fourth calendar quarter is included
in both periods presented. The pro forma adjustments are
described in the accompanying notes to the pro forma condensed
combined financial statements and should be read in conjunction
with such pro forma condensed combined financial statements.
Such pro forma financial statements should also be read in
conjunction with Moog's consolidated financial statements and
notes set forth in the Report on Form 10-K for the year ended
September 30, 1993 and the Report on Form 10-Q for the period
ended March 31, 1994. The pro forma condensed combined financial
statements are not necessarily indicative of the actual results
that would have occurred had the transaction been consummated
September 30, 1992 or of the future results of operations which
will be obtained by Moog as a result of the acquisition.
19
MOOG INC.
Pro Forma Condensed Combined Statements of Operations (Unaudited)
Six Months Ended March 31, 1994
(In thousands)
Moog Inc
and the
Acquired
Acquired Product
Product Acquisition Lines After
Moog Inc Lines Adjustments Acquisition
NET SALES $ 143,945 $ 48,026 $ 191,971
OTHER INCOME 933 140 1,073
144,878 48,166 0 193,044
COSTS AND EXPENSES
Cost of sales 100,662 33,571 (2,833) (1) 131,400
Research and development
expenses 9,966 1,214 11,180
Selling, general and
administrative expenses 26,393 7,268 (163) (2) 33,498
Interest expense 4,723 745 2,118 (3) 7,586
Foreign currency exchange
gain (221) - (221)
Other expenses 501 352 452 (4) 1,305
Inventory obsolescence charge 2,574 - 2,574
Restructuring expenses 2,107 - 2,107
146,705 43,150 (426) 189,429
EARNINGS (LOSS) BEFORE INCOME
TAXES AND CUMULATIVE
EFFECT OF CHANGE IN
ACCOUNTING PRINCIPLE (1,827) 5,016 426 3,615
INCOME TAXES (BENEFITS) (784) 1,915 170 (5) 1,301
EARNINGS (LOSS) BEFORE
CUMULATIVE EFFECT
OF CHANGE IN ACCOUNTING
PRINCIPLE (1,043) 3,101 256 2,314
EARNINGS (LOSS) PER
COMMON SHARE BEFORE
CUMULATIVE EFFECT
OF CHANGE IN ACCOUNTING
PRINCIPLE ($.13) $.30
AVERAGE COMMON SHARES
OUTSTANDING 7,713,465 7,713,465
See Notes to Pro Forma Condensed Combined Financial Statements
20
MOOG INC.
Pro Forma Condensed Combined Statements of Operations (Unaudited)
Year Ended September 30, 1993
(In thousands)
Moog Inc
and the
Acquired
Acquired Product
Product Acquisition Lines After
Moog Inc Lines Adjustments Acquisition
NET SALES $ 293,680 $ 100,450 $ 394,130
OTHER INCOME 2,663 1,097 3,760
296,343 101,547 0 397,890
COSTS AND EXPENSES
Cost of sales 206,985 78,512 (9,807) (1) 275,690
Research and development
expenses 16,128 2,756 18,884
Selling, general and
administrative expenses 52,723 17,060 (369) (2) 69,414
Interest expense 10,974 1,812 3,914 (3) 16,700
Foreign currency exchange
loss 60 - 60
Other expenses 853 1,910 654 (4) 3,417
287,723 102,050 (5,608) 384,165
EARNINGS (LOSS) BEFORE INCOME TAXES
AND EXTRAORDINARY ITEM 8,620 (503) 5,608 13,725
INCOME TAXES (BENEFITS) 3,502 (201) 2,243 (5) 5,544
EARNINGS (LOSS) BEFORE
EXTRAORDINARY ITEM $ 5,118 (302) 3,365 8,181
EARNINGS (LOSS) PER
COMMON SHARE BEFORE
EXTRAORDINARY ITEM $.66 $1.06
AVERAGE COMMON SHARES
OUTSTANDING 7,713,465 7,713,465
See Notes to Pro Forma Condensed Combined Financial Statements
21
MOOG INC.
Pro Forma Condensed Combined Balance Sheet (Unaudited)
March 31, 1994
(In thousands)
Moog Inc
and the
Acquired
Acquired Product
Product Acquisition Lines After
ASSETS Moog Inc Lines Adjustments Acquisition
CURRENT ASSETS
Cash and cash equivalents $ 9,077 $ 9,077
Receivables, net 115,588 7,800 (7,800) (6) 115,588
Inventories 63,277 20,200 (2,273) (6) 81,204
Deferred income taxes 11,145 - 3,646 (6) 14,791
Prepaid expenses and other
current assets 3,323 - 5,125 (6) 8,448
TOTAL CURRENT ASSETS 202,410 28,000 (1,302) 229,108
PROPERTY, PLANT AND
EQUIPMENT, NET 92,348 43,990 (1,168) (6) 135,170
OTHER ASSETS 5,433 300 22,697 (6) 28,430
TOTAL ASSETS $ 300,191 $ 72,290 $ 20,227 $392,708
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable $ 17,011 - $ 17,011
Current installments of
long-term debt and
convertible subordinated
debentures 14,812 - 14,812
Accounts payable 16,981 4,400 (4,400) (6) 16,981
Accrued salaries, wages
and commissions 15,664 3,600 (663) (6) 18,601
Contract loss reserves 5,156 - 6,000 (6) 11,156
Other accrued liabilities 12,419 2,900 276 (6) 15,595
Accrued income taxes 348 - 348
Customer advances 5,564 2,800 680 (6) 9,044
TOTAL CURRENT LIABILITIES 87,955 13,700 1,893 103,548
See Notes to Pro Forma Condensed Combined Financial Statement
22
LONG-TERM DEBT, EXCLUDING
CURRENT INSTALLMENTS 68,592 - 76,355 (6) 144,947
LONG-TERM PENSION OBLIGATION 24,771 - 569 (6) 25,340
OTHER LONG-TERM OBLIGATIONS 692 - 692
DEFERRED INCOME TAXES 5,508 - 5,508
CONVERTIBLE SUBORDINATED
DEBENTURES 19,400 - 19,400
MINORITY INTEREST IN SUBSIDIARY
COMPANY 1,437 - 1,437
SHAREHOLDERS' EQUITY 91,836 58,590 (58,590) 91,836
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 300,191 $ 72,290 $ 20,227 $392,708
See Notes to Pro Forma Condensed Combined Financial Statement
23
MOOG INC.
Notes to Pro Forma Combined Condensed Financial Statements
(In Thousands)
(Unaudited)
The following pro forma adjustments have been made to
reflect the acquisition of the Product Lines by Moog Inc. as if
the acquisition occurred on September 30, 1992:
(1) Represents the adjustment required to conform the
Product Lines' accounting principle for long-term
contracts to Moog's methods.
Moog follows the cost to cost percentage of
completion method of accounting and uses the
contract as source for determining profitability
or loss reserve requirements. AlliedSignal (the
previous parent of the Product Lines) records
revenue on a units shipped basis and views
contracts as part of a program when determining
whether contract loss reserves are required.
In addition, depreciation and amortization expense
has been reduced by $914 in 1993 and $588 for the
six months ended March 31, 1994 relating to the
allocation of the purchase price. Intangibles
associated with the allocation of purchase price
total $20,994.
(2) Represents amortization of deferred costs
associated with the acquisition and debt issuance
costs ($286 in 1993 and $143 for the six months
ended March 31, 1994) offset by a proforma
reduction to the amount allocated to the Product
Lines by AlliedSignal for corporate and sector
assessments ($655 in 1993 and $306 for the six
months ended March 31, 1994).
(3) Represents incremental interest on debt used to
finance the transaction including $2,003 in
acquisition related costs.
(4) Represents elimination of equity income from an
affiliate of the Product Lines which was not
acquired as part of the transaction.
(5) Represents the tax effects of the above adjust-
ments at Moog's approximate statutory tax rate.
(6) These adjustments are required to reflect the
allocation of the $74,352 purchase price to the
assets acquired and liabilities assumed and record
costs associated with the transaction including
deferred debt issuance costs.
24
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 hereunto duly authorized.
MOOG INC.
(Registrant)
Date: August 26, 1994
By:
Robert R. Banta
Executive Vice President
25
Consent of Price Waterhouse LLP
26
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the
Registration Statements on Form S-8 (Nos. 33-36721, 33-36722 and
33-62968) of Moog Inc. of our report dated July 22, 1994 relating
to the financial statements of the AlliedSignal Mechanical and
Hydraulic Actuation Division, which appears on page 4 of this
Current Report on Form 8-K/A of Moog Inc. dated August 26, 1994.
PRICE WATERHOUSE LLP
Woodland Hills, California
August 25, 1994
27