FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 30, 2003
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to ______________
-------------------------------
Commission File Number 0-17297
BTU INTERNATIONAL, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 04-2781248
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
23 Esquire Road, North Billerica, Massachusetts 01862-2596
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (978) 667-4111
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 [ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). Yes [ ] No [X]
Indicate the number of shares outstanding of the Registrant's Common
Stock, par value $.01 per share, as of the latest practicable date: As of May
12, 2003: 7,002,578 shares.
BTU INTERNATIONAL, INC.
TABLE OF CONTENTS
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets 1-2
Condensed Consolidated Statements of Operations 3
Condensed Consolidated Statement of Stockholders' Equity
and Consolidated Statements of Comprehensive Loss 4
Condensed Consolidated Statements of Cash Flows 5
Notes to Condensed Consolidated Financial Statements 6-7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 8-10
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
PART II. OTHER INFORMATION
Signatures 11
Exhibits and Reports on Form 8-K 12
Calculation of Net Loss per Common and Common
Equivalent Share 13
BTU INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
ASSETS
(Unaudited)
March 30, December 31,
2003 2002
---- ----
Current assets
Cash and cash equivalents $11,027 $13,847
Accounts receivable, less reserves of $172 5,333 4,532
Inventories (Note 2) 7,009 6,668
Refundable income taxes 1,700 1,700
Other current assets 336 417
------- -------
Total current assets 25,405 27,164
------- -------
Property, plant and equipment, at cost
Land 210 210
Buildings and improvements 7,929 7,894
Machinery and equipment 7,602 7,645
Furniture and fixtures 856 856
------- -------
16,597 16,605
Less-Accumulated depreciation 12,716 12,568
------- -------
Net property, plant and equipment 3,881 4,037
Other assets, net of accumulated amortization of $365 at
March 30, 2003 and $362 at December 31, 2002 313 313
------- -------
$29,599 $31,514
======= =======
The accompanying notes are an integral part of these condensed consolidated
financial statements.
1
BTU INTERNATIONAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands except share data)
LIABILITIES AND STOCKHOLDERS' EQUITY
(Unaudited)
March 30, December 31,
2003 2002
---- ----
Current liabilities
Current maturities of long-term debt and
capital lease obligations (Note 3) $ 337 $ 329
Current portion of long-term deferred
compensation 150 200
Accounts payable 2,800 2,601
Accrued expenses 2,512 2,623
-------- --------
Total current liabilities 5,799 5,753
-------- --------
Long-term debt and capital lease obligations, less
current maturities (Note 3) 3,921 4,010
Long-term deferred compensation 600 650
-------- --------
10,320 10,413
-------- --------
Stockholders' Equity
Series preferred stock, $1.00 par value-
Authorized - 5,000,000 shares-
Issued and outstanding - none - -
Common stock, $.01 par value-
Authorized - 25,000,000 shares;
Issued - 8,151,588, outstanding 7,002,578
at March 30, 2003 and December 31, 2002 81 81
Additional paid-in capital 21,976 21,976
Deferred compensation (46) (71)
Accumulated earnings 1,262 3,035
Treasury stock- at cost, 1,149,010 shares at
March 30, 2003 and December 31, 2002 (4,177) (4,177)
Accumulated other comprehensive income 183 257
-------- --------
Total stockholders' equity 19,279 21,101
-------- --------
$ 29,599 $ 31,514
======== ========
The accompanying notes are an integral part of these condensed consolidated
financial statements.
2
BTU INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 30, 2003 AND MARCH 31, 2002
(in thousands, except share and per share data)
(Unaudited)
Three Months Ended
-----------------------------
March 30, March 31,
2003 2002
---- ----
Net sales $ 6,836 $ 8,507
Cost of goods sold 4,983 5,940
----------- -----------
Gross profit 1,853 2,567
Operating expenses:
Selling, general and administrative 2,750 3,583
Research, development and engineering 822 946
----------- -----------
Loss from operations (1,719) (1,962)
----------- -----------
Interest income 32 56
Interest expense (87) (94)
Other income, net 1 -
----------- -----------
Loss before income tax benefit (1,773) (2,000)
Income tax benefit - (700)
----------- -----------
Net loss $ (1,773) $ (1,300)
=========== ===========
Loss Per Share:
Basic $ (0.25) $ (0.19)
Diluted $ (0.25) $ (0.19)
=========== ===========
Weighted average number of Shares Outstanding:
Basic Shares 7,002,578 6,840,693
Effect of Dilutive Options - -
----------- -----------
Diluted Shares 7,002,578 6,840,693
=========== ===========
The accompanying notes are an integral part of these condensed consolidated
financial statements.
3
BTU INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE THREE MONTHS ENDED MARCH 30, 2003
(in thousands)
(Unaudited)
ACCUMULATED
ADDITIONAL OTHER TOTAL
COMMON PAID-IN DEFERRED ACCUMULATED TREASURY COMPREHENSIVE STOCKHOLDERS'
STOCK CAPITAL COMP. EARNINGS STOCK INCOME EQUITY
----- ------- ----- -------- ----- ------ ------
Balance at
Dec. 31, 2002 $81 $21,976 $(71) $ 3,035 $(4,177) $ 257 $ 21,101
Net loss - - - (1,773) - - (1,773)
Translation
Adjustment - - - - - (74) (74)
Deferred
Compensation - - 25 - - - 25
--- ------- ---- ------- ------- ----- --------
Balance at
March 30, 2003 $81 $21,976 $(46) $ 1,262 $(4,177) $ 183 $ 19,279
=== ======= ==== ======= ======= ===== ========
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
FOR THE THREE MONTHS ENDED MARCH 30, 2003 AND MARCH 31, 2002
(in thousands)
(Unaudited)
Three Months Ended
--------------------------
March 30, March 31,
2003 2002
---- ----
Net loss $(1,773) $(1,300)
Other comprehensive income:
Foreign currency translation adjustment (74) (5)
------- -------
Comprehensive loss $(1,847) $(1,305)
======= =======
The accompanying notes are an integral part of these condensed consolidated
financial statements.
4
BTU INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 30, 2003 AND MARCH 31, 2002
(in thousands)
(Unaudited)
March 30, March 31,
2003 2002
---- ----
Cash flows from operating activities:
Net loss $ (1,773) $ (1,300)
Adjustments to reconcile net loss to net cash
used in by operating activities -
Depreciation and amortization 294 342
Stock based compensation 25 15
Net changes in operating assets and liabilities-
Accounts receivable (801) (918)
Inventories (341) 1,109
Other current assets 81 (500)
Other assets (3) 25
Accounts payable 199 (490)
Accrued expenses (111) (521)
Deferred compensation (100) -
-------- --------
Net cash used in operating activities (2,530) (2,238)
-------- --------
Cash flows from investing activities:
Purchases of property, plant and equipment, net (135) (42)
-------- --------
Net cash used in investing activities (135) (42)
-------- --------
Cash flows from financing activities:
Principal payments under long-term debt and capital lease
obligations (81) (76)
Exercise of stock options - 62
-------- --------
Net cash used in financing activities (81) (14)
-------- --------
Effect of exchange rates on cash (74) (5)
-------- --------
Net decrease in cash and cash equivalents (2,820) (2,299)
Cash and cash equivalents, at beginning of the period 13,847 15,716
-------- --------
Cash and cash equivalents, at end of the period $ 11,027 $ 13,417
======== ========
Supplemental disclosures of cash flow information
Cash paid during the periods for -
Interest $ 87 $ 94
Income taxes 17 9
The accompanying notes are an integral part of these condensed consolidated
financial statements.
5
BTU INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(1) Basis for presentation
The condensed consolidated balance sheets as of March 30, 2003 and
December 31, 2002, the related condensed consolidated statements of operations
for the three months ended March 30, 2003 and March 31, 2002, the condensed
consolidated statement of stockholders' equity for the three months ended March
30, 2003, the condensed consolidated statements of cash flows for the three
months ended March 30, 2003 and March 31, 2002, the consolidated statements of
comprehensive loss for the three months ended March 30, 2003 and March 31, 2002
are unaudited. In the opinion of management, all adjustments necessary for the
fair presentation of such financial statements have been included. Such
adjustments consisted only of normal recurring items. Interim results are not
necessarily indicative of results for the full year. These financial statements
do not include all disclosures associated with annual financial statements, and
accordingly, should be read in conjunction with the footnotes contained in the
Company's consolidated financial statements as of, and for the period ended
December 31, 2002, together with the auditors' report, included in the Company's
Annual Report on Form 10-K, as filed with the Securities and Exchange
Commission.
(2) Inventories
Inventories at March 30, 2003 and December 31, 2002 consisted of:
(in thousands)
---------------------------
March 30, December 31,
2003 2002
---- ----
Raw materials and manufactured components $ 4,122 $ 4,548
Work-in-process 2,425 2,066
Finished goods 984 816
Less: Reserves (522) (762)
------- -------
$ 7,009 $ 6,668
======= =======
(3) Debt
Debt at March 30, 2003 and December 31, 2002 consisted of:
(in thousands)
-------------------------
March 30, December 31,
2003 2002
---- ----
Mortgage note payable $4,223 $4,298
Capital lease obligations, interest rates ranging from 10.2% to 10.3%,
net of interest of $ 3 and $ 4 in 2003 and 2002, respectively 35 41
------ ------
4,258 4,339
Less-current maturities 337 329
------ ------
$3,921 $4,010
====== ======
The mortgage note payable is secured by the Company's land and building
and requires monthly payments of $53,922, including interest at 8.125%. This
mortgage note payable has a balloon payment of $3,825,000 due and payable at
maturity on July 1, 2004.
6
BTU INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)
The Company has an unsecured revolving line of credit with a US bank,
which allows for aggregate borrowings, including letters of credit, up to a
maximum of $14 million against a borrowing base of all assets except real
estate. The Company may elect to borrow at interest rates pegged to either the
bank's base rate or the LIBOR rate in effect from time to time. This loan
agreement extends to May 31, 2006 and is subject to maintaining certain
financial covenants. As of March 30, 2003, no amounts were outstanding under
this unsecured revolving line of credit.
(4) Earnings Per Share
Basic EPS is computed by dividing income available to common stockholders
by the weighted-average number of common shares outstanding during the period.
Diluted EPS is computed using the weighted average number of common and dilutive
potential common shares outstanding during the period, using the treasury stock
method. Options outstanding, which were not included in the determination of
diluted EPS for the three months ended March 30, 2003 and March 31, 2002 because
they were antidilutive, were 1,258,398 and 1,033,514 respectively.
(5) Segment Reporting
Segments are defined as components of an enterprise about which separate
financial information is available that is evaluated regularly by the chief
operating decision-maker in deciding how to allocate resources and in assessing
performance. The Company operates as a single business segment called thermal
processing capital equipment.
The thermal processing capital equipment segment consists of the
designing, manufacturing, selling and servicing of thermal processing equipment
and related process controls for use in the electronics, power generation,
automotive and other industries. This business segment includes the supply of
solder reflow systems used for surface mount applications in printed circuit
board assembly. Thermal processing equipment is used in: low temperature
curing/encapsulation; hybrid integrated circuit manufacturing; integrated
circuit packaging and sealing; and processing multi-chip modules. In addition,
the thermal process equipment is used for sintering nuclear fuel for commercial
power generation, as well as brazing and the sintering of ceramics and powdered
metals, and the deposition of precise thin film coatings. The business segment's
customers are multinational original equipment manufacturers and electronic
manufacturing service providers.
(6) Revenue Recognition
The Company recognizes revenue in accordance with the Securities and
Exchange Commission (SEC) Staff Accounting Bulletin (SAB) No. 101, "Revenue
Recognition in Financial Statements." Under SAB No. 101, when the terms of sale
include customer acceptance provisions, and compliance with those provisions can
not be demonstrated until customer use, revenues are recognized upon acceptance.
Furthermore, revenues for products that require installation for which the
installation is essential to functionality or is not deemed inconsequential or
perfunctory are recognized upon completion of installation. Revenues for
products sold where installation is not essential to functionality and is deemed
inconsequential or perfunctory are recognized upon shipment with estimated
installation and warranty costs accrued.
Applying the requirements of SAB No. 101 to future sales arrangements used
in the Company's thermal processing equipment sales may result in the deferral
of the revenue for some equipment sales. The Company continues to evaluate the
impact that SAB No. 101 might have on its sales transactions. However, there
will be no impact on the Company's cash flows from operations as a result of any
change.
7
The Company also has certain sales transactions for projects, which are
not completed within the normal operating cycle of the business. These contracts
are accounted for on a percentage completion basis. Under the percentage
completion method, revenues are recognized based upon the ratio of costs
incurred to the total estimated costs. Revisions in costs and profit estimates
are reflected in the period in which the facts causing the revision become
known. Provisions for total estimated losses on uncompleted contracts, if any,
are made in the period in which such losses are determined. For the three months
ended March 30,2003 there was no revenue recognized using the percentage of
completion method. For the three months ended March 31, 2002, $252,717 of
revenue was recognized using the percentage of completion method.
The Company accounts for shipping and handling costs billed to customers in
accordance with Emerging Issues Task Force (EITF) Issue 00-10 "Accounting for
Shipping and Handling Fees and Cost". Amounts billed to customers for shipping
and handling costs are reclassified as revenues with the associated costs
reported as selling costs.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Net Sales. Net sales decreased 19.6% from $8.5 million in the first
quarter of 2002 to $6.8 million in the first quarter of 2003. The decrease
represents the continued decline in demand for capital equipment by the
electronics industry.
When comparing the first quarter of 2002 to the first quarter of 2003 the
percentage of net sales attributable to our customers in the United States
decreased from 58.0% to 43.5%, net sales attributable to our customers in Europe
increased from 13.5% to 19.3%, net sales attributable to our Asia Pacific
customers increased from 26.8% to 37.2%, and net sales attributable to our
customers in the Other Americas decreased from 1.7% to 0.0%.
Gross Profit. Gross profit decreased 27.8% from $2.6 million in the first
quarter of 2002 to $1.9 million in the first quarter of 2003, and as a
percentage of net sales, decreased from 30.2% to 27.1%. The decrease in gross
profit and gross profit percentage is a direct result of decreased demand for
products in the electronics marketplace. This decrease in demand resulted in
significant price pressure and under absorption of overhead costs.
Selling, General and Administrative. Selling, general and administrative
expenses decreased 23.2% from $ 3.6 million in the first quarter of 2002 to $
2.8 million in the first quarter of 2003. As a percentage of net sales, selling,
general and administrative expenses decreased from 42.1% in the first quarter
2002 to 40.2% in the first quarter of 2003. The decrease in these costs in the
first quarter of 2003 was the result of lower expenditures for the Company's
service, sales and marketing functions.
Research, Development and Engineering. Research, development and
engineering decreased 13.1% from $946,000 in the first quarter of 2002 to
$822,000 in the first quarter of 2003, and as a percentage of net sales,
increased from 11.1% to 12.0% for the same period. In the first quarter of 2003
we continued our support of product development, but at reduced levels given the
current economic climate.
Operating Loss. Operating loss decreased 12.4% from $2.0 million in the
first quarter of 2002 to $1.7 million in the first quarter of 2003, and as a
percentage of net sales, increased from 23.1% to 25.1%. The decrease in
operating loss was primarily the result of continued reductions in spending.
Income Taxes. The Company has recorded a full valuation allowance to
offset it's deferred tax asset arising as a result of the Company's net
operating loss carryforward due to the uncertainty surrounding realization.
Accordingly, no income tax benefit is reflected in the statement of operations
at March 30, 2003. Our statutory federal income tax rate is 34.0%.
8
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (continued)
LIQUIDITY AND CAPITAL RESOURCES
As of March 30, 2003, we had $11.0 million in cash and cash equivalents.
The Company has an unsecured revolving line of credit with a US bank,
which allows for aggregate borrowings, including letters of credit, up to a
maximum of $14 million against a borrowing base of all assets except real
estate. The Company may elect to borrow at interest rates pegged to either the
bank's base rate or the LIBOR rate in effect from time to time. This loan
agreement extends to May 31, 2006 and is subject to maintaining certain
financial covenants. As of March 30, 2003, no amounts were outstanding under
this unsecured revolving line of credit.
We have a mortgage note that is secured by our real property. The mortgage
note had an outstanding balance at March 30, 2003 of approximately $4.2 million.
The mortgage requires monthly payments of $53,922, which includes interest
calculated at the rate of 8.125% per annum. A final balloon payment of
approximately $3.8 million is due on July 1, 2004 upon maturity of the mortgage
note.
During the three months ended March 30, 2003, the Company used cash
resources of $2.8 million. This use of cash was primarily the result of net
losses of $1.8 million and an increase in accounts receivable and inventory of
$1.1 million.
We expect that our current cash position and ability to borrow necessary
funds will be sufficient to meet our corporate, operating and capital
requirements into 2004.
OTHER MATTERS
The impact of inflation and the effect of foreign exchange rate changes
during 2003 have had no material impact on our business and financial results.
RECENT ACCOUNTING DEVELOPMENTS
See 2002 Annual Report on Form 10-K, on file with the SEC.
9
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (continued)
FORWARD LOOKING STATEMENTS
This Report, other than historical financial information, includes
forward-looking statements that involve known and unknown risks and
uncertainties, including quarterly fluctuations in results. Such statements are
made pursuant to the "safe harbor" provisions under the securities laws, and are
based on the assumptions and expectations of the Company's management at the
time such statements are made. Important factors that could cause actual results
to differ include the timely availability and acceptance of new products,
general market conditions governing supply and demand, the impact of competitive
products and pricing and other risks detailed in the Company's filings with the
Securities and Exchange Commission. Actual results may vary materially.
Accordingly, you should not place undue reliance on any forward-looking
statements. Unless otherwise required by law, the Company disclaims any
obligation to revise or update such forward-looking statements in order to
reflect future events or developments.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We do not believe that we have any material market risk exposure with
respect to derivative or other financial instruments.
CONTROLS AND PROCEDURES
Our disclosure controls and procedures are designed to ensure that
information required to be disclosed in reports that we file or submit under the
Securities Exchange Act of 1934, as amended, is recorded, processed, summarized
and reported within the time periods specified in the rules and forms of the
Securities and Exchange Commission. The Chief Executive Officer and Chief
Financial Officer have reviewed the effectiveness of our disclosure controls
and procedures within the last ninety days and have concluded that the
disclosure controls and procedures are effective. There were no significant
changes in our internal controls or in other factors that could significantly
affect these controls subsequent to the last day they were evaluated by our
Chief Executive Officer and Chief Financial Officer.
10
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.
BTU INTERNATIONAL, INC.
DATE: May 14, 2003 BY: /s/ Mark R. Rosenzweig
----------------------
Mark R. Rosenzweig
President, Chief Executive Officer
(principal executive officer) and Director
DATE: May 14, 2003 BY: /s/ Thomas P. Kealy
-------------------
Thomas P. Kealy
Vice President, Corporate Controller and
Chief Accounting Officer (principal
financial and accounting officer)
CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Mark R. Rosenzweig, certify that:
1. I have reviewed this quarterly report on Form 10-Q of BTU International,
Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: May 14, 2003
/s/ Mark R. Rosenzweig
-----------------------------------------------
Mark R. Rosenzweig
President, Chief Executive Officer and Director
CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Thomas P. Kealy, certify that:
1. I have reviewed this quarterly report on Form 10-Q of BTU International,
Inc.;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this annual report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent
functions):
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether there were significant changes in internal controls or
in other factors that could significantly affect internal controls subsequent to
the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.
Date: May 14, 2003
/S/ Thomas P. Kealy
----------------------------------------
Thomas P. Kealy
Vice President, Corporate Controller and
Chief Accounting Officer
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 11.0 - Calculation of net income per common and common
equivalent share.
Exhibit 99.1 - Section 906 Certification
Exhibit 99.2 - Section 906 Certification
(b) Reports on Form 8-K
On April 18, 2003, the Company filed a Current Report on Form 8-K to
notify shareholders of the Company's release of it's financial results for
quarter ended March 30, 2003.