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U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly period ended: January 31, 2001
-----------------------------------
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
For the transition period from to
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Commission file number: 0-10187
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Prab, Inc.
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(Exact name of small business issuer as
specified in its charter)
Michigan 38-1654849
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5944 E. Kilgore Rd, P.O. Box 2121, Kalamazoo, Michigan 49003
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(Address of principal executive offices)
(Zip Code)
(616) 382-8200
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(Issuer's telephone number)
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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
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State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
Common Stock, par value $.10 per share - 1,817,339 shares outstanding at
February 28, 2001.
Transitional Small Business Disclosure Format
(Check One): Yes No X
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
The following Financial Statements are attached hereto in response to Item 1:
Condensed Consolidated Balance Sheet
January 31, 2001 (Unaudited)
and October 31, 2000
Consolidated Statement of Earnings
Three months ended January 31, 2001
and 2000 (Unaudited)
Condensed Consolidated Statement of Cash Flows
Three months ended January 31, 2001
and 2000 (Unaudited)
Notes to Condensed Consolidated Financial Statements
Item 2. Management's Discussion and Analysis or Plan of Operation
Material Changes in Financial Condition. Accounts receivable decrease
resulted from lower sales in the first quarter of 2001 versus the fourth quarter
of 2000 combined with the collection of several past due receivables. The
inventory increase resulted primarily from a large equipment order being
rescheduled to ship in February, which contributed to the increase in work in
process inventory.
Accounts and note payable decrease primarily resulted from paying down
the line of credit by $175,000 in the first quarter combined with paying
$115,000 of accrued general insurance.
Material Changes in Results of Operations. Sales in the first quarter
of 2001 were 8% higher than the first quarter of 2000. Higher sales are the
result of an increased backlog at the end of fiscal year 2000 versus the end of
fiscal year 1999. New business order bookings have decreased 14% in the first
three months of fiscal year 2001 compared to the same period a year ago,
contributing to the reduction in the backlog of booked orders from $3,984,000 at
October 31, 2000 to $2,687,000 at the end of the first quarter ended January 31,
2001.
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Costs of products sold were 62% in the first three months of 2001 and
2000. Selling, general and administrative expenses were 35% in the first three
months of 2001 and 37% in the same period a year ago. The decrease primarily
results from higher sales in the first quarter of 2001, combined with lower
engineering costs compared to the same period a year ago.
The order backlog of $2,687,000 at the end of the first quarter ended
January 31, 2001 compares with $3,984,000 at the end of the previous quarter
ended October 31, 2001 and $2,820,000 at the end of the first quarter a year
ago.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits: None
(b) Reports on Form 8-K:
No reports on Form 8-K have been filed during the quarter for
which this report is filed.
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SIGNATURES
Pursuant to the requirements of the Exchange Act, the Registrant caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
PRAB, INC.
Date: March 5, 2001 By: /S/ Gary A. Herder
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Gary A. Herder
Its: Chairman, President and
Chief Executive Officer
Date: March 5, 2001 By: /S/ Robert W. Klinge
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Robert W. Klinge
Its: Chief Financial Officer
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Quarterly Report on Form 10-QSB
For the Quarter Ended January 31, 2001
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Financial Statements
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PRAB, INC.
(A Michigan Corporation)
5944 E. Kilgore Road
P.O. Box 2121
Kalamazoo, Michigan 49003
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PRAB, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
January 31, October 31,
2001 2000
----------- ----------
Unaudited (Note)
ASSETS:
Current assets:
Cash $ 157,892 $ 68,480
Accounts Receivable 1,830,959 2,322,523
Inventories (Note 2) 1,916,786 1,734,828
Other current assets 247,291 241,696
Deferred income taxes 381,852 381,852
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Total current assets $ 4,534,780 $ 4,749,379
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Property, plant and equipment
(net of accumulated depreciation of
$3,921,372 and $3,869,982, respectively) 966,832 982,629
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Other Assets
Other assets 152,673 138,362
Deferred income taxes 315,183 346,239
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Total other assets 467,856 484,601
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Total assets $ 5,969,468 $ 6,216,609
================= =================
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts and note payable $ 1,013,151 $ 1,353,507
Other current liabilities 1,199,673 1,167,066
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Total current liabilities 2,212,824 2,520,573
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Other non-current liabilities 19,930 19,608
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Stockholders' equity:
Common Stock 176,734 176,734
Additional paid-in capital 1,080,202 1,080,202
Retained earnings 2,479,778 2,419,492
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Total stockholders' equity 3,736,714 3,676,428
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Total liabilities and stockholders' equity $ 5,969,468 $ 6,216,609
================= =================
Note: The balance sheet at October 31, 2000, has been taken from the audited
financial statements at that date and condensed.
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PRAB, INC.
CONSOLIDATED STATEMENT OF EARNINGS
(Unaudited)
Three Months Ended
January 31,
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2001 2000
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Net Sales $ 3,683,744 $ 3,423,213
Costs and expenses:
Cost of products sold 2,295,122 2,135,384
Selling, general and
administrative expenses 1,303,295 1,273,051
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3,598,417 3,408,435
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Operating income 85,327 14,778
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Interest expense 6,252 4,440
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Income before income taxes 79,075 10,338
Provision for income taxes 18,789 4,920
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Net Income $ 60,286 $ 5,418
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Earning (Loss) Per Common Share:
(Note 4)
Basic $ 0.03 $ (0.18)
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Diluted $ 0.03 $ (0.18)
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PRAB, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
Three months ended
January 31,
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2001 2000
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Net cash provided by (used in) operating activities $ 300,005 $ 390,623
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Cash flows from investing activities:
Acquisition of property, plant and equipment (35,593) (50,260)
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Net cash provided by (used in) investing
activities: (35,593) (50,260)
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Cash flows from financing activities:
Net increase (decrease) in short term borrowings (175,000) 300,000
Dividend payments -- (3,544)
Repurchase of stock -- (597,666)
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Net cash provided by (used in) financing activities (175,000) (301,210)
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Net increase (decrease) in cash 89,412 39,153
Cash -- Beginning of year 68,480 46,637
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Cash -- End of first quarter $ 157,892 $ 85,790
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PRAB, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:
The condensed consolidated balance sheet at January 31, 2001, the
consolidated statement of earnings and the condensed consolidated statement of
cash flows for the three-month periods ended January 31, 2001 and 2000, have
been prepared by the Company without audit. In the opinion of management, all
adjustments necessary to present fairly the financial position, results of
operations and cash flows at January 31, 2001, and for all periods presented
have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. It is suggested that these condensed
consolidated financial statements be read in conjunction with the financial
statements and notes thereto included in the Company's October 31, 2000, annual
report to stockholders. The results of operations for the period ended January
31, 2001, is not necessarily indicative of the operating results for the full
year.
2. INVENTORIES:
Inventories consist of the following:
January October
31, 2001 31, 2000
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Raw materials $ 749,193 $ 1,053,827
Work in process 641,789 237,747
Finished goods and display
units 525,804 443,254
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Total inventories $ 1,916,786 $ 1,734,828
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3. UNUSED LINE OF CREDIT:
The company has a $1,750,000 line of credit which is subject to a
borrowing formula based upon certain asset levels of the Company. As of January
31, 2001, $1,696,586 was available to the Company under the line of credit and
the Company had borrowed $250,000 of such amount.
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PRAB, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
4. RECONCILIATION OF EARNINGS PER SHARE:
FOR THE QUARTER ENDED JANUARY 31, 2001
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INCOME SHARES PER-SHARE
(Numerator) (Denominator) Amount
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Net Income $ 60,286
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Basic EPS
Income available to
common stockholders 60,286 1,767,339 $ .03
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Effect of dilutive securities
Stock options -- 90,036
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Diluted EPS
Income available to
common stockholders &
assumed conversions $ 60,286 1,857,375 $ .03
================ ================ ================
FOR THE QUARTER ENDED JANUARY 31, 2000
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INCOME SHARES PER-SHARE
(Numerator) (Denominator) Amount
----------- ------------- ------
Net Income $ 5,418
Less: Preferred stock dividends 3,544
Preferred stock redemption premium 322,667
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Basic EPS
Income available to
common stockholders (320,793) 1,757,339 $ (.18)
=================
Effect of dilutive securities
Stock options --
Convertible preferred stock -- --
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Diluted EPS
Income available to
common stockholders &
assumed conversions $ (320,793) 1,757,339 $ (.18)
================= ================ =================
Convertible preferred stock and stock options had an antidilutive effect on
diluted earnings per share for the quarter ended January 31, 2000 and were not
used in the calculation of diluted earnings per share for that quarter.
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