1
EXHIBIT 13.1
MANAGEMENT'S DISCUSSION OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
($ in thousands except per share amounts)
RESULTS OF OPERATIONS
- ---------------------
Net sales were $328,231, $271,856, and $222,643 in 1995, 1994, and 1993,
respectively. In 1995, sales increased 20.7% due to increased shipments of
aluminum wheels and other automotive components, and higher pricing driven by
escalating material costs. In 1994, sales increased 22.1% due to a strong
market for the Company's plumbing products and increased demand for aluminum
wheels and automotive components.
The gross profit percent was 20.8%, 21.8%, and 22.6% in 1995, 1994, and
1993, respectively. The gross profit percent decreased in 1995 due to rising
material costs. As higher aluminum and copper costs were passed through to
customers, material costs as a percentage of sales increased, resulting in a
lower gross profit percent. Gross profit decreased as a percent of sales in
1994, primarily due to the underutilization of two recently constructed
automotive parts plants. The higher gross profit percent in 1993, resulted from
improved pricing for copper plumbing products and lower costs for copper used
in many of the Company's flow control products. These improvements were
partially offset by reduced unit volumes for copper plumbing products and lower
demand for aluminum wheels.
Selling, general and administrative expenses, as a percent of sales, were
12.5% in 1995, 13.3% in 1994, and 14.2% in 1993. As a percent of sales, these
expenses have decreased due to higher sales levels. Expenses have increased
year to year reflecting higher sales and marketing costs to support business
expansion.
Interest expense was $1,387, $1,594, and $1,266 in 1995, 1994, and 1993,
respectively. Interest expense decreased in 1995 as long-term debt was retired.
Although borrowing increased in the current year, the proceeds financed plant
construction and expansions and accordingly, the interest related to these
long-term projects was capitalized. Average borrowings were lower in 1994,
however, interest expense was higher compared to 1993 when interest was
capitalized during the construction period of two new manufacturing facilities.
Interest rates were slightly higher in 1994 compared to 1993.
Other income was higher in 1993, compared to subsequent years, primarily due
to the gain realized on the sale of a facility.
The effective tax rate in 1995 was 34.2%, compared to the 34.5% in 1994.
The 1995 rate is lower than the statutory rate due to federal tax credits.
The rate decreased in 1994 compared to 36% in 1993 primarily due to the tax
benefit derived from the conversion of Casting Technology Corporation
(CTC), a joint venture of Amcast and Izumi, to a partnership.
In 1992, the Company adopted a plan to divest Stanley G. Flagg & Co.,
(Flagg), a manufacturer of iron and brass pipe fittings and pole line hardware
for the utility market. A significant portion of the Flagg assets, relating to
the iron and pole line hardware businesses have been sold. Effective August
31, 1995, the Company elected to retain the
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brass fittings business, which is currently operating in a portion of the
Flagg facility. The assets and operating results of the brass business are
not material to the Company, therefore, previously reported results of
operations and statements of financial condition of Amcast have not been
reclassified. The brass business will be reported as part of flow control
segment. Sales in 1995 were $7,615 and assets were $11,857 at year end. The
remaining idle assets of the iron and pole line businesses are being held for
sale and reported at their net realizable value in the caption, Other Assets.
See Discontinued and Retained Operations note on page 23.
During the fourth quarter of 1993, the Company elected early adoption,
effective September 1, 1992, of the Statement of Financial Accounting Standards
(SFAS) No. 106, "Employers' Accounting for Postretirement Benefits Other Than
Pensions". This statement requires companies to record a liability for
employees' accumulated postretirement benefit costs and to recognize ongoing
expenses on an accrual basis. The Company recognized the $6,159 pre-tax
cumulative effect of the change in accounting principle, which represents the
accumulated postretirement benefit obligation as of September 1, 1992. The
effect on net income and shareholders' equity was $3,942, or $.47 per share.
The impact on 1993 operating results, due to the adoption of SFAS 106, was not
material.
FLOW CONTROL PRODUCTS
- ---------------------
Flow Control Products sales were $146,692, $124,090, and $110,096 in 1995,
1994, and 1993, respectively. Operating profits were $25,387, $19,849, and
$15,703 in 1995, 1994, and 1993, respectively. In 1995, sales increased 18.2%
while operating profits rose 27.9%. Margins increased due to higher operating
efficiencies and the Company's strong market position, which allowed for
improved price realization. In 1994, sales increased 12.7% while operating
profits rose 26.4% due to improved margins resulting from cost reductions and
increased sales volume.
ENGINEERED COMPONENTS
- ---------------------
Engineered Components sales were $181,539, $147,766, and $112,547 in 1995,
1994, and 1993, respectively. Operating profits were $8,862, $10,034, and
$8,228 in 1995, 1994, and 1993, respectively. In 1995, sales increased 22.9%
due to higher volumes of aluminum wheels and automotive components, and higher
pricing driven by escalating aluminum costs. Operating profits decreased 11.7%
due to costs related to launching several new products which offset the
improvements in sales volume. In 1994, sales increased 31.3% while operating
profits increased 21.9%. The increase in sales was primarily due to strong
customer demand for aluminum wheels and other aluminum automotive components.
Higher operating profits, resulting primarily from wheel sales, were partially
offset by the underutilization of two new automotive parts plants.
LIQUIDITY
- ---------
Net cash provided by operations was $15,464, $29,578, and $17,958 for the
years 1995, 1994, and 1993, respectively. In each of the three years, cash was
primarily provided by income from operations, and depreciation. In 1995,
inventories and accounts receivables increased to support the increased sales
volume.
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Net cash used by investing activities was $42,743, $8,848, and $11,121 for
the years 1995, 1994, and 1993, respectively. To support the business expansion
activities, investments were made in property, plant, and equipment, and
Casting Technology Company.
Net cash provided (used) by financing activities was $13,151, $(7,567), and
$(7,726) for the years 1995, 1994, and 1993, respectively. In 1995, increased
borrowings were used to fund business expansion. In 1994 and 1993, financing
activities used cash primarily to reduce long-term debt and pay cash
dividends.
CAPITAL RESOURCES
- -----------------
Capital expenditures were $41,724, $15,596, and $13,990 in 1995, 1994, and
1993, respectively. In 1995, expenditures were funded by additions to long-term
debt, cash provided by operations, and the prior year cash position. In 1994
and 1993, the expenditures were funded by cash provided by operations. At
August 31, 1995, the Company had $16,296 of commitments for capital
expenditures to be made in 1996, primarily for the Engineered Components
segment.
Book value per common share at August 31, 1995, was $14.52, up from $13.02
the prior year. The ratio of long-term debt as a percent of capital increased
to 19.3% at August 31, 1995, from 11.2% at August 31, 1994.
In June of 1995, the Company signed a new five year, $60 million, revolving
credit agreement with its five-member bank group. The agreement consists of a
three-year revolving period, which may be extended for up to two years under
certain conditions, followed by a two-year term loan commitment. The new
agreement provides enhanced borrowing capacity and flexibility to support the
Company's growth program. The financing replaces a prior $40 million agreement
which was to expire in 1997.
The Company has $146.9 million of unused borrowing capacity under the most
restrictive debt covenant relating to the above mentioned credit agreement. One
million preferred shares and 6.4 million common shares are authorized and
available for future issuance. Management believes the Company has adequate
financial resources to meet its future needs.
Contingencies. The Company, as is normal for the industry in which it
operates, is involved in certain legal proceedings and subject to certain
claims and site investigations that arise under the environmental laws and
which have not been finally adjudicated. To the extent possible, with the
information available, the Company regularly evaluates its responsibility with
respect to environmental proceedings. The factors considered in this
evaluation are described in detail in the Commitments and Contingencies note to
the consolidated financial statements. At August 31, 1995, the Company had
accrued reserves of $2.6 million for environmental liabilities. The Company is
of the opinion that, in light of its existing reserves, its liability in
connection with environmental proceedings should not have a material adverse
effect on its financial condition or results of operation.
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REPORT OF ERNST & YOUNG LLP
INDEPENDENT AUDITORS
Shareholders and Board of Directors
Amcast Industrial Corporation
Dayton, Ohio
We have audited the accompanying consolidated statements of financial condition
of Amcast Industrial Corporation and subsidiaries as of August 31, 1995 and
1994, and the related consolidated statements of operations, shareholders'
equity, and cash flows for each of the three years in the period ended August
31, 1995. These financial statements are the responsibility of the Company'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. Those standards 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.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the consolidated financial position of Amcast
Industrial Corporation and subsidiaries at August 31, 1995 and 1994, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended August 31, 1995, in conformity with generally
accepted accounting principles.
As discussed in the Postretirement Health Care and Life Insurance Benefits
note to the consolidated financial statements, in 1993 the Company adopted the
provisions of Statement of Financial Accounting Standards No. 106, "Employers'
Accounting for Postretirement Benefits Other Than Pensions."
Ernst & Young LLP
Dayton, Ohio
October 10, 1995
/s/ Ernst & Young LLP
--------------------
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SELECTED DATA
($ in thousands except per common share and statistical data)
FINANCIAL DATA 1995 1994 1993 1992 1991
Net sales . . . . . . . . . . . . . . . . . $328,231 $271,856 $222,643 $236,805 $220,643
Gross profit . . . . . . . . . . . . . . . . 68,111 59,258 50,425 52,247 47,271
Gross profit percent . . . . . . . . . . . . 20.8% 21.8% 22.6% 22.1% 21.4%
Income before taxes . . . . . . . . . . . . 26,098 22,067 18,831 18,740 11,944
Income from continuing operations . . . . . . 17,171 14,454 12,052 11,994 7,405
Working capital . . . . . . . . . . . . . . 47,845 48,590 36,097 32,525 45,287
Total assets . . . . . . . . . . . . . . . . 229,367 194,161 176,537 173,774 175,211
Long-term debt . . . . . . . . . . . . . . . 29,687 13,910 17,929 22,276 40,424
PER COMMON SHARE DATA
Income from continuing operations . . . . . $ 2.02 $ 1.72 $ 1.44 $ 1.66 $ 1.14
Weighted average number of common
shares outstanding (in thousands). . . . . 8,517 8,425 8,347 7,223 6,487
Dividends declared . . . . . . . . . . . . . $ .53 $ .49 $ .48 $ .48 $ .48
Book value . . . . . . . . . . . . . . . . . 14.52 13.02 11.81 11.37 10.80
STATISTICAL DATA
Current ratio . . . . . . . . . . . . . . . 1.9 2.0 1.9 1.8 2.0
Long-term debt as a percent of capital . . . 19.3% 11.2% 15.3% 19.1% 36.9%
Average number of employess . . . . . . . . . 2,400 2,100 1,900 1,900 1,900
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CONSOLIDATED STATEMENTS OF OPERATIONS
($ in thousands except per share amounts)
Year Ended August 31
1995 1994 1993
Net sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $328,231 $271,856 $222,643
Cost of sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 260,120 212,598 172,218
------- ------- -------
GROSS PROFIT 68,111 59,258 50,425
Selling, general and administrative expenses . . . . . . . . . . . . . . . . . . 41,139 36,038 31,515
------ ------ ------
OPERATING INCOME 26,972 23,220 18,910
Other income, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 513 441 1,187
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,387 1,594 1,266
----- ----- -----
INCOME BEFORE INCOME TAXES 26,098 22,067 18,831
Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,927 7,613 6,779
----- ----- -----
INCOME BEFORE CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING PRINCIPLE 17,171 14,454 12,052
Cumulative effect of change in accounting for postretirement
benefits other than pensions, net of taxes (3,942)
----------- ----------- -----------
NET INCOME $17,171 $14,454 $8,110
----------- ----------- -----------
Income per share:
Income before cumulative effect of a change in accounting principle . . . . $2.02 $1.72 $1.44
Cumulative effect of a change in accounting principle . . . . . . . . . . . . (.47)
----------- ----------- -----------
Net income per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2.02 $1.72 $.97
=========== =========== ===========
See notes to consolidated financial statements
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CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
($ in thousands)
AUGUST 31
1995 1994
ASSETS
CURRENT ASSETS
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 1,286 $ 15,414
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44,643 38,400
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49,146 38,469
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,786 5,143
----------- -----------
TOTAL CURRENT ASSETS 102,861 97,426
PROPERTY, PLANT, AND EQUIPMENT
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,978 1,940
Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27,653 25,130
Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135,163 110,287
Construction in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35,530 11,828
----------- -----------
200,324 149,185
Less allowances for depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94,701 75,531
----------- -----------
105,623 73,654
NET ASSETS OF DISCONTINUED OPERATION . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,389
OTHER ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,883 10,692
----------- -----------
$229,367 $194,161
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 33,647 $ 27,169
Compensation and related items . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,719 9,066
Accrued expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,930 7,482
Current portion of long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,522 4,019
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,198 1,100
---------- -----------
TOTAL CURRENT LIABILITIES 55,016 48,836
LONG-TERM DEBT--less current portion . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,687 13,910
DEFERRED INCOME TAXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,952 4,024
DEFERRED LIABILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,507 17,228
SHAREHOLDERS' EQUITY
Preferred shares, without par value:
Authorized--1,000,000 shares
Issued--None
Common shares, at stated value:
Authorized--15,000,000 shares
Issued--8,555,875 shares, 8,457,896 shares in 1994 . . . . . . . . . . . . . . . . . . 8,556 8,458
Capital in excess of stated value . . . . . . . . . . . . . . . . . . . . . . . . . . . 64,175 62,912
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51,474 38,793
---------- -----------
124,205 110,163
---------- -----------
$229,367 $194,161
========== ===========
See notes to consolidated financial statements
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CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
($ in thousands)
Capital in Common
Common Excess of Retained Shares in
Shares Stated Value Earnings Treasury Total
BALANCE AT SEPTEMBER 1, 1992 . . . . . . . . . . . . . $8,370 $62,006 $24,695 $ (651) $ 94,420
Net income . . . . . . . . . . . . . . . . . . . . . 8,110 8,110
Cash dividends declared, $.48 per share . . . . . . . (4,014) (4,014)
Stock options exercised . . . . . . . . . . . . . . 13 61 564 638
Other . . . . . . . . . . . . . . . . . . . . . . . (20) (214) (234)
--------- --------- --------- -------- ----------
BALANCE AT AUGUST 31, 1993 8,383 62,047 28,577 (87) 98,920
Net income . . . . . . . . . . . . . . . . . . . . . 14,454 14,454
Cash dividends declared, $.49 per share . . . . . . . (4,134) (4,134)
Stock options exercised . . . . . . . . . . . . . . 75 698 87 860
Tax benefit from stock options exercised . . . . . . 167 167
Other . . . . . . . . . . . . . . . . . . . . . . . (104) (104)
--------- --------- --------- -------- -----------
BALANCE AT AUGUST 31, 1994 8,458 62,912 38,793 110,163
NET INCOME . . . . . . . . . . . . . . . . . . . . . 17,171 17,171
CASH DIVIDENDS DECLARED, $.53 PER SHARE . . . . . . . (4,523) (4,523)
STOCK OPTIONS EXERCISED . . . . . . . . . . . . . . 98 1,029 1,127
TAX BENEFIT FROM STOCK OPTIONS EXERCISED . . . . . . 234 234
Other . . . . . . . . . . . . . . . . . . . . . . . 33 33
--------- --------- --------- -------- -----------
Balance at August 31, 1995 $8,556 $64,175 $51,474 $ -- $124,205
========= ========= ========= ======== ===========
See Notes to Consolidated Financial Statements
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CONSOLIDATED STATEMENTS OF CASH FLOWS
($ in thousands )
Year Ended August 31
1995 1994 1993
OPERATING ACTIVITIES:
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 17,171 $ 14,454 $ 8,110
Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,392 12,812 12,010
Cumulative effect of change in accounting principle . . . . . . . . . . . . 6,159
Deferred liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . (793) 380 (1,183)
Loss (gain) on property, plant and equipment disposals . . . . . . . . . . 22 46 (850)
Changes in assets and liabilities:
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . (6,243) (4,636) 1,245
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (10,677) (3,897) (1,757)
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,643) (887) (1,622)
Prepaid pension costs . . . . . . . . . . . . . . . . . . . . . . . . . 249 336 548
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1,691) 613 (2,105)
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,478 9,119 (4,160)
Accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . (801) 1,238 1,563
---------- ----------- -----------
NET CASH PROVIDED BY OPERATIONS 15,464 29,578 17,958
INVESTING ACTIVITIES:
Proceeds from property, plant, and equipment disposals. . . . . . . . . . . 482 171 1,907
Additions to property, plant, and equipment . . . . . . . . . . . . . . . . (41,724) (15,596) (13,990)
Contributions to joint venture . . . . . . . . . . . . . . . . . . . . . . (6,660) (1,014) (180)
Decrease in discontinued and other assets . . . . . . . . . . . . . . . . 5,159 7,591 1,142
---------- ----------- -----------
NET CASH USED BY INVESTING ACTIVITIES (42,743) (8,848) (11,121)
FINANCING ACTIVITIES:
Additions to long-term debt . . . . . . . . . . . . . . . . . . . . . . . . 20,300
Proceeds from exercise of stock options . . . . . . . . . . . . . . . . . . 1,361 1,027 628
Reduction in long-term debt . . . . . . . . . . . . . . . . . . . . . . . . (4,523) (4,019) (4,347)
Short-term borrowings and current portion of long-term debt . . . . . . . . 503 (337) 231
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (4,523) (4,134) (4,014)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 (104) (224)
---------- ----------- -----------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES 13,151 (7,567) (7,726)
---------- ----------- -----------
Net change in cash and cash equivalents . . . . . . . . . . . . . . . . . . (14,128) 13,163 (889)
Cash and cash equivalents at beginning of year . . . . . . . . . . . . . . . 15,414 2,251 3,140
---------- ----------- -----------
CASH AND CASH EQUIVALENTS AT END OF YEAR $ 1,286 $ 15,414 $ 2,251
========== =========== ===========
See notes to consolidated financial statements
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
($ in thousands except per share data)
ACCOUNTING POLICIES
THE CONSOLIDATED FINANCIAL STATEMENTS include the accounts of Amcast Industrial
Corporation and its subsidiaries (the Company). Intercompany transactions have
been eliminated.
CASH AND CASH EQUIVALENTS include amounts on deposit with financial
institutions and investments maturing within 90 days.
ACCOUNTS RECEIVABLE are stated net of allowances for doubtful accounts of $222
at August 31, 1995, and $147 at August 31, 1994.
INVENTORIES are valued at the lower of cost or market using the last-in,
first-out (LIFO) and the first-in, first-out (FIFO) methods.
PROPERTY, PLANT, AND EQUIPMENT are carried at cost. Expenditures for
significant renewals and improvements are capitalized. Repairs and maintenance
are charged to expense as incurred.
DEPRECIATION is computed on the straight-line method. The amortization periods
represent the estimated useful lives of the assets.
DEFERRED INCOME TAXES are provided for temporary differences between financial
and tax reporting in accordance with the liability method under the provisions
of Statement of Financial Accounting Standard No. 109, "Accounting for Income
Taxes".
NET INCOME PER SHARE is computed on the weighted average number of common
shares outstanding during each year. The exercise of outstanding options, which
are common stock equivalents, would cause no material dilution.
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DISCONTINUED AND RETAINED OPERATIONS
Effective August 31, 1992, the Company adopted a plan to sell the Stanley G.
Flagg & Co. division (Flagg), a manufacturer of iron and brass pipe fittings
and utility pole line hardware. Since 1992, the Company has reported Flagg as
a discontinued operation.
The Company has sold inventory and machinery and equipment relating to the iron
fittings and the utility hardware product lines. Certain idle equipment
relating to these product lines remains unsold. Effective August 31,1995, the
Company decided to retain the brass business of Flagg. The brass business is
currently operating in a portion of the Flagg facility. The operations and the
assets of the brass business are immaterial to the Company and therefore,
previously reported results of operations and statements of financial condition
have not been reclassified. In the future, sales of the brass business will be
reported in the Flow Control Products Segment. Sales were $7,615 in 1995.
Total assets, included in Flow Control Products identifiable assets, were
$11,857 at year end. The asset values of the remaining idle facility and
machinery and equipment relating to the iron and utility hardware product lines
are being held for sale and are recorded at their net realizable value in other
assets.
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INVENTORIES
The major components of inventories as of August 31 are:
1995 1994
Finished products .............................. $31,881 $21,234
Work in process ................................ 15,450 13,121
Raw materials and supplies...................... 11,961 10,435
------ ------
59,292 44,790
Less amount to reduce certain
inventories to LIFO value .................... 10,146 6,321
------ ------
$49,146 $38,469
======= =======
Inventories reported on the FIFO method were $12,901 and $5,435 at August 31,
1995 and 1994, respectively. The estimated replacement cost of inventories is
the amount reported before the LIFO reserve.
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OTHER ASSETS
The major components of other assets as of August 31 are:
1995 1994
Assets held for resale................. $ 3,522 $ 553
Investment in joint venture............ 7,278 648
Other ................................. 10,083 9,491
------- -------
$20,883 $10,692
======= =======
Properties held for resale reflect the estimated realizable values of the
fixed assets of closed facilities. The investment in joint venture represents
the Company's share of Casting Technology Company's net equity.
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LONG-TERM DEBT AND CREDIT ARRANGEMENTS
The following table summarizes the Company's borrowings at August 31:
1995 1994
Senior notes........................ $7,232 $10,964
Revolving credit notes.............. 13,000
Lines of credit..................... 7,300
Industrial revenue bonds ........... 6,677 6,965
------- -------
34,209 17,929
Less current portion................ 4,522 4,019
------- -------
LONG-TERM DEBT $29,687 $13,910
======= =======
Senior notes consist of two agreements with interest rates of 9.32% and 9%.
The notes call for periodic principal payments and mature June 5, 1996, and
September 15, 1999, respectively.
The Company has a $60,000 credit agreement extending through March 31, 2000.
There were $13,000 outstanding borrowings under this credit agreement at August
31, 1995, with a weighted average interest rate of 6.3%. The interest rate on
borrowings under this agreement is based on, at the Company's option, the prime
rate, the certificate of deposit rate plus a premium, or the Euro-dollar rate
plus a premium. Premiums are subject to Company performance measured on a
quarterly basis and range from 0.375% to 0.75%. A commitment fee of 0.15% is
payable on the unused portion of the credit line.
The Company has lines of credit totaling $25,000. At August 31, 1995,
borrowings were $7,300 with a weighted average interest rate of 6.4%. These
lines require no material compensating balances or commitment fees.
Industrial revenue bonds consist of various issues at fixed and variable
interest rates, ranging from 3.9% to 5%. These bonds call for principal
payments at various dates through 2004.
Debt covenants require the Company to maintain certain current and
debt-to-equity ratios. Other provisions limit the aggregate amount of certain
defined payments including purchase of Company stock and cash dividends. At
August 31, 1995, all retained earnings were available for the payment of
dividends.
The obligations in connection with industrial revenue bonds and certain
notes included in long-term debt are collateralized by property, plant, and
equipment with a net book value of $2,907 and $3,673 at August 31, 1995 and
1994, respectively.
Long-term debt maturities for each of the next five years are $4,522 in
1996, $1,105 in 1997, $1,107 in 1998, $6,990 in 1999, and $14,910 in 2000.
Capitalized interest was $390 and $878 in 1995 and 1993, respectively.
Interest paid was $1,830, $1,705, and $2,230 in 1995, 1994, and 1993,
respectively.
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STOCK OPTIONS
The Company has two active stock option plans.
The 1981 Stock Option Plan was approved by shareholders of the Company on
December 16, 1981, and amended by the shareholders on December 18, 1985. The
plan provided for the granting of a maximum of 400,000 options to purchase
common shares to key employees of the Company and its subsidiaries. The option
price per share may not be less than the fair market value of a share on the
date the option is granted, and the maximum term of an option may not exceed
ten years. Options granted under the plan may include related stock
appreciation rights. Granting of options under this plan expired on October
13, 1991.
The 1989 Stock Incentive Plan was approved by shareholders of the Company on
December 14, 1988 and amended by the shareholders on December 9, 1992. The
plan provides for the granting of a maximum of 800,000 stock options, stock
appreciation rights, performance awards, and restricted stock awards to key
employees of the Company and its subsidiaries. The option price per share may
not be less than the fair market value of a share on the date the option is
granted, and the maximum term of an option may not exceed ten years.
The 1989 Director Stock Option Plan was approved by the shareholders of the
Company on December 14, 1988. The plan provides for the granting of a maximum
of 120,000 nonqualified stock options. The option price per share is equal to
the fair market value of a Company share on the date of grant. The term of
each option is five years, and an option first becomes exercisable one year
after the date of grant. Under the plan, each person serving as a director of
the Company on the first business day of January of each year, who is not
employed by the Company will automatically be granted 1,500 options.
Information regarding the Company's stock option plans is summarized below:
1981 1989 1989
Stock Stock Director Stock
Option Plan Incentive Plan Option Plan
Shares under option:
Outstanding at September 1, 1992 . . . . . . . . . . . . . . . . . . 30,832 263,084 45,000
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102,623 12,000
Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . (23,832) (46,174) (10,500)
---------- ---------- ----------
Outstanding at August 31, 1993 . . . . . . . . . . . . . . . . . . . 7,000 319,533 46,500
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97,932 10,500
Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . (7,000) (65,009) (15,000)
Canceled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (11,129)
---------- ---------- ----------
Outstanding at August 31, 1994 . . . . . . . . . . . . . . . . . . . 341,327 42,000
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129,137 10,500
Exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . (91,144) (6,000)
Canceled. . . . . . . . . . . . . . . . . . . . . . . . . . . . . (11,000)
---------- ----------
Outstanding at August 31, 1995 . . . . . . . . . . . . . . . . . . . 368,320 46,500
---------- ----------
Options available to grant at August 31, 1995 . . . . . . . . . . . . 121,803 39,000
========== ==========
Average option price per share:
At August 31, 1993 . . . . . . . . . . . . . . . . . . . . . . . . $ 12.75 $ 12.81 $ 14.37
At August 31, 1994 . . . . . . . . . . . . . . . . . . . . . . . . 14.95 16.69
At August 31, 1995 . . . . . . . . . . . . . . . . . . . . . . . . 17.33 18.39
Options exercisable:
At August 31, 1993 . . . . . . . . . . . . . . . . . . . . . . . . 7,000 216,910 34,500
At August 31, 1994 . . . . . . . . . . . . . . . . . . . . . . . . 243,395 31,500
At August 31, 1995 . . . . . . . . . . . . . . . . . . . . . . . . 244,183 36,000
Average price of options exercised:
Year Ended August 31, 1993 . . . . . . . . . . . . . . . . . . . . $ 11.43 $ 9.44 $ 11.04
Year Ended August 31, 1994 . . . . . . . . . . . . . . . . . . . . 12.75 11.78 12.66
Year Ended August 31, 1995 . . . . . . . . . . . . . . . . . . . . 11.47 11.00
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LEASES
The Company has a number of operating lease agreements primarily involving
machinery, physical distribution, and computer equipment. Certain of these
leases contain renewal or purchase options which vary by lease. These leases
are noncancelable and expire on dates through 2000.
Rent expense was $5,206, $5,234, and $2,404 for the years ended August 31,
1995, 1994, and 1993, respectively.
The following is a schedule by year of future minimum rental payments
required under the operating leases that have initial or remaining
noncancelable lease terms in excess of one year as of August 31, 1995:
1996 . . . . . . . . . . . . . . . . . . . $ 4,403
1997 . . . . . . . . . . . . . . . . . . . 3,815
1998 . . . . . . . . . . . . . . . . . . . 8,210
1999 . . . . . . . . . . . . . . . . . . . 188
2000 . . . . . . . . . . . . . . . . . . . 61
----------
TOTAL MINIMUM LEASE PAYMENTS $ 16,677
==========
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PREFERRED SHARE PURCHASE RIGHTS
The Company has a Shareholder Rights Plan pursuant to which holders of the
Company's common shares receive a dividend of one preferred share purchase
right (collectively, the "Rights") for each common share held. The Rights
contain features which, under defined circumstances, allow holders to buy
shares at a bargain price. The Rights will expire on February 28, 1998. The
Rights are not presently exercisable and trade in tandem with the common
shares. The Rights become exercisable following the close of business on the
tenth day after a public announcement that a person or group has acquired 20%
or more of the common shares of the Company or a public announcement or
commencement of a tender or exchange offer which would result in ownership of
30% or more of the common shares of Amcast. It is expected that the Rights will
begin to trade independently of the Company's common shares at that time.
The Company may redeem the Rights for one cent per Right any time prior to
the close of business on the tenth day following the day that a 20% position is
acquired and under certain circumstances thereafter, including certain
transactions not involving a 20% shareholder of the Company.
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COMMITMENTS AND CONTINGENCIES
At August 31, 1995, the Company has committed to capital expenditures
of $16,296 in 1996, primarily for the Engineered Components segment.
The Company, as is normal for the industry in which it operates, is
involved in certain legal proceedings and subject to certain claims and site
investigations which arise under the environmental laws and which have not been
finally adjudicated.
The Company has been identified as a potentially responsible party by
various state agencies and by the United States Environmental Protection Agency
(U.S. EPA) under the Comprehensive Environmental Response Compensation and
Liability Act of 1980, as amended, for costs associated with eight U.S. EPA led
multi-party sites and six state environmental agency-led remediation sites.
Each of these claims involves third-party owned disposal sites for which
compensation is sought from the Company as an alleged waste generator for
recovery of past governmental costs or for future investigation or remedial
actions. The designation as a potentially responsible party and the assertion
of such claims against the Company are made without taking into consideration
the extent of the Company's involvement with the particular site. In each
instance, claims have been asserted against a number of other entities for the
same recovery or other relief as was asserted against the Company. These
claims are in various stages of administrative or judicial proceeding. The
Company has no reason to believe that it will have to pay a significantly
disproportionate share of clean-up costs associated with any site.
To the extent possible, with the information available at the time,
the Company has evaluated its responsibility for costs and related liability
with respect to the above sites. In making such evaluation, the Company did
not take into consideration any possible cost reimbursement claims against its
insurance carriers. The Company is of the opinion that its liability with
respect to those sites should not have a material adverse effect on its
financial position or results of operations. In arriving at this conclusion,
the principal factors considered by the Company were ongoing settlement
discussions with respect to certain of the sites, the volume and relative
toxicity of waste alleged to have been disposed of by the Company at certain
sites, which factors are often used to allocate investigative and remedial
costs among potentially responsible parties, the probable costs to be paid by
other potentially responsible parties, total projected remedial costs for a
site, if known, and the Company's existing reserve to cover costs associated
with unresolved environmental proceedings. At August 31, 1995, the Company's
accrued undiscounted reserve for such contingencies was $2.6 million.
Allied-Signal Inc. has brought an action against the Company seeking a
contribution from the Company equal to 50% of Allied-Signal's estimated $30
million remediation cost in connection with a site in southern Ohio. The
Company believes its responsibility with respect to this site is very limited
due to the nature of the foundry sand waste it disposed of at the site. A
trial in this case was completed in February of 1995, but no judgment has been
rendered. The Company believes that if it has any liability at all in regard
to this matter, that liability would not be material to its financial position
or results of operations.
The Company is a defendant in a lawsuit brought by the Public Interest
Research Group Inc. seeking substantial penalties for alleged waste water
discharges by the Company's Stanley G. Flagg & Co. division during a 48-month
period ended in October of 1988. The Company's discharges have been in
compliance since at least 1990. The Company therefore believes that penalties,
if any, will not be material to its financial position or results of
operations.
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PENSION PLANS
The Company has a noncontributory defined benefit pension plan covering certain
employees. The plan covers salaried employees and provides pension benefits
that are based on years of credited service, employee compensation during years
preceding retirement, and the primary social security benefit. The plan also
covers hourly employees and provides pension benefits of stated amounts for
each year of credited service. The Company's policy is to fund the annual
amount required by the Employee Retirement Income Security Act of 1974. Plan
assets consist of U.S. Treasury bonds and notes, U.S. governmental agency
issues, corporate bonds, and common stocks. The plan held 350,000 common shares
of the Company at August 31, 1995 (7.8% of plan assets) and 1994 (9% of plan
assets).
The Company also sponsors a deferred compensation profit sharing plan for
the benefit of substantially all salaried employees. The Company provides a 15%
match on employee contributions up to 6% of eligible compensation and a
supplemental savings match from 1% to 35% based on the Company achieving a
minimum return on shareholders' equity and subject to IRS limitations.
The Company participates in a multiemployer plan which provides defined
benefits to certain bargaining unit employees.
The following table sets forth the funded status and the amounts recognized
in the consolidated statements of financial condition for the Company's
defined benefit plan at August 31:
1995 1994
Actuarial present value of benefit obligation:
Vested benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(81,636) $(78,127)
========= ========
Accumulated benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(82,573) $(78,901)
========== ========
Projected benefit obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $(87,233) $(82,654)
Plan assets at fair value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85,559 82,986
--------- --------
(Under) overfunded projected benefit obligation . . . . . . . . . . . . . . . . . . . . . . (1,674) 332
Unrecognized net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,026 1,847
Unrecognized prior service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,897 2,020
Unrecognized transition (asset) being recognized over a minimum of 15 years . . . . . . . . (3,625) (4,183)
--------- ---------
Net pension (liability) asset recognized in the consolidated
statement of financial condition . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (376) $ 16
======== =========
A summary of the components of net periodic pension cost for the defined plan in 1995, 1994, and 1993, and the total amounts
charged to expense for the defined contribution and multiemployer plans follows:
1995 1994 1993
Defined benefit plan:
Service cost of current period . . . . . . . . . . . . . . . . . . . . . . $ 1,133 $ 1,315 $ 1,278
Interest cost on projected benefit obligation . . . . . . . . . . . . . . 6,412 6,289 6,466
Actual return on plan assets . . . . . . . . . . . . . . . . . . . . . . . (10,021) (1,798) (10,159)
Net amortization and deferral . . . . . . . . . . . . . . . . . . . . . . 2,868 (5,320) 2,963
-------- --------- ---------
Net pension cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 392 486 548
Defined contribution plan . . . . . . . . . . . . . . . . . . . . . . . . . . 510 410 301
Multiemployer pension plan . . . . . . . . . . . . . . . . . . . . . . . . . 214 197 180
--------- --------- ---------
TOTAL COST $ 1,116 $ 1,093 $ 1,029
========= ========= =========
Assumed rates of return:
Weighted average discount rate . . . . . . . . . . . . . . . . . . . . . . 7.5% 8.0% 7.5%
Rate of future compensation increase . . . . . . . . . . . . . . . . . . . 4.7% 4.7% 4.7%
Long-term return on assets:
Dedicated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.0% 7.5% 8.5%
Nondedicated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.5% 10.0% 10.0%
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POSTRETIREMENT HEALTH CARE AND LIFE INSURANCE BENEFITS
The Company provides health care and life insurance benefits to designated
salary and hourly employees who participate in a defined benefit pension plan
and who retired prior to January 1, 1992. The plan coordinates with Medicare
and requires employee contributions. The Company also provides similar benefits
to certain employees, represented by bargaining units, who retire before
attaining age 65 and meet certain minimum service requirements. Benefits for
the bargaining unit employees terminate when the retiree attains age 65. The
Company funds the postretirement benefits on a cash basis.
In the fourth quarter of 1993, the Company elected to adopt Statement of
Financial Accounting Standards (SFAS) No.106, "Employers' Accounting for
Postretirement Benefits Other Than Pensions", effective September 1, 1992. The
statement requires the cost of these benefits to be recognized during the
employee's active working career rather than expensed when paid as had been the
prior practice.
The cumulative effect of adopting SFAS 106 using the immediate recognition
method as of September 1, 1992, was a charge to earnings of $3,942, net of
$2,217 deferred income tax benefit. The adoption of SFAS 106 had no material
effect on 1993 operating results.
Accumulated postretirement benefit obligation recognized in 1995 and 1994:
1995 1994
Retirees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $4,390 $3,497
Fully eligible active plan participants . . . . . . . . . . . . . . . . . . . . . . . . 346 1,718
Other active employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 427 292
-------- ----------
5,163 5,507
Deferred gain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 241 358
--------- ----------
$5,404 $5,865
========= ==========
In prior years, health care and life insurance benefits for retired
employees of closed facilities were provided for at the time the related
facility was closed. The accrued postretirement benefit obligation for these
retirees at August 31, 1995 was $2,400.
Net periodic postretirement benefit expense for 1995, 1994 and 1993 is
as follows:
1995 1994 1993
Service cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 25 $ 28 $ 40
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 415 460 447
-------- ------- -------
$ 440 $ 488 $ 487
======== ======== =======
The actuarial assumptions used to determine 1995 and 1994 costs and benefit
obligation includes a discount rate of 7.5% and 8%, respectively. The assumed
rates of future increases in per capita cost of health care benefits (health
care trend rates) are 8% in 1996 and 9% in 1995, decreasing gradually to 5.5%
by the year 1999. Increasing the health care trend rate by one percentage
point would increase the accumulated postretirement benefit obligation $250 and
would increase the 1995 postretirement benefit cost $21.
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INCOME TAXES
The provisions for income taxes are as follows:
1995 1994 1993
Currently payable
State and local . . . . . . . . . . . . . . . . . . . . . . $ 561 $ 466 $ 14
Foreign . . . . . . . . . . . . . . . . . . . . . . . . . . 542 460 108
Federal . . . . . . . . . . . . . . . . . . . . . . . . . . 4,896 3,962 2,269
Deferred
State and local . . . . . . . . . . . . . . . . . . . . . . 88 (100) 100
Federal . . . . . . . . . . . . . . . . . . . . . . . . . . 2,840 2,825 4,288
------------ ----------- ------------
$8,927 $7,613 $6,779
============ =========== ============
Reconciliations of income taxes computed by applying the statutory federal
income tax rate to the provisions for income taxes are as follows:
Federal income tax at statutory rate . . . . . . . . . . . . . $9,134 $7,723 $6,528
Federal tax credits . . . . . . . . . . . . . . . . . . . . . . (400)
State income taxes . . . . . . . . . . . . . . . . . . . . . . 422 238 74
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . (229) (348) 177
------------ ----------- ----------
$8,927 $7,613 $6,779
============= =========== ===========
Deferred taxes resulting from temporary differences between financial and tax
reporting are as follows:
Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . $ 846 $ 628 $ 672
Restructuring . . . . . . . . . . . . . . . . . . . . . . . . . 847 518 646
Discontinued operation . . . . . . . . . . . . . . . . . . . . 645 2,493 1,882
Start-up costs . . . . . . . . . . . . . . . . . . . . . . . . 1,359 (137) 1,323
Federal tax credits . . . . . . . . . . . . . . . . . . . . . . (400)
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (369) (317) (27)
------------ ----------- ----------
$2,928 $3,185 $4,496
============ =========== ==========
The Company has income tax credits of $400 expiring in 2006 through 2010 and an
alternative minimum tax credit of $1,092 available to offset future tax
payments. Income taxes paid totaled $6,603, $3,347, and $2,474 in 1995, 1994,
and 1993, respectively.
Significant components of deferred tax assets and liabilities are as follows:
Deferred tax assets related to: 1995 1994
Accrued compensation and related items . . . . . . . . . . . . $5,284 $6,747
Tax credit carryforwards . . . . . . . . . . . . . . . . . . . 1,492 975
Other. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,311 3,187
-------- -----------
10,087 10,909
Deferred tax liabilities related to:
Depreciation . . . . . . . . . . . . . . . . . . . . . . . . 10,408 9,888
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,201 3,615
-------- -----------
15,609 13,503
-------- -----------
Net deferred tax liabilities . . . . . . . . . . . . . . . . . . $5,522 $2,594
======== ===========
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MAJOR CUSTOMERS AND CREDIT CONCENTRATION
The Company sells products to customers primarily in the United States. The
Company performs ongoing credit evaluations of customers, and generally does
not require collateral. Allowances are maintained for potential credit losses
and such losses have been within management's expectations.
On August 31, 1995, trade receivables from the domestic automotive industry
were $17,674 and $21,173 was due from the construction industry.
Sales to Engineered Components' largest customer, General Motors
Corporation, were $120,100, $89,300, and $60,000 for the years ended August
31, 1995, 1994, and 1993, respectively. Trade receivables from General Motors
Corporation on August 31, 1995 and 1994, were $13,192 and $10,175 and were
current. No other single customer accounted for a material portion of trade
receivables.
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BUSINESS SEGMENTS
($ in thousands)
The Company has two business segments, Flow Control Products and Engineered
Components.
Through the Flow Control Products and Engineered Components segments, the
Company serves the construction, automotive, industrial, and aerospace sectors
of the economy. See Corporate Profile on the inside front cover and pages 4
through 13 for a review of the major products produced.
Flow Control Products sales of copper plumbing fittings amounted to
$112,492, $92,532, and $80,156 in 1995, 1994, and 1993, respectively. Sales of
aluminum products to the automotive industry by Engineered Components amounted
to $150,215, $111,104, and $76,873 in 1995, 1994, and 1993, respectively.
Export sales and sales by geographic area were not material.
NET SALES INCOME BEFORE INCOME TAXES
1995 1994 1993 1995 1994 1993
Flow Control Products . . . . $146,692 $124,090 $110,096 $25,387 $19,849 $15,703
Engineered Components . . . . 181,539 147,766 112,547 8,862 10,034 8,228
Corporate . . . . . . . . . . (6,764) (6,222) (3,834)
Interest Expense. . . . . . . (1,387) (1,594) (1,266)
-------- -------- -------- ------- ------- -------
$328,231 $271,856 $222,643 $26,098 $22,067 $18,831
======== ======== ======== ======= ======= =======
IDENTIFIABLE ASSETS DEPRECIATION
Flow Control Products . . . . $ 92,373 $ 65,564 $ 61,753 $ 4,294 $ 3,913 $ 3,947
Engineered Components . . . . 133,437 97,798 89,061 9,954 8,707 7,813
Corporate . . . . . . . . . . 3,557 18,410 5,743 144 192 250
-------- -------- --------
Continuing Operations . . . . 229,367 181,772 156,557
Discontinued Operation . . . 12,389 19,980
-------- -------- -------- ------- ------- -------
$229,367 $194,161 $176,537 $14,392 $12,812 $12,010
======== ======== ======== ======= ======= =======
CAPITAL EXPENDITURES
Flow Control Products . . . . $ 12,236 $ 4,893 $ 2,345
Engineered Components . . . . 29,371 10,592 11,522
Corporate . . . . . . . . . . 117 111 123
-------- -------- --------
$ 41,724 $ 15,596 $ 13,990
======== ======== ========
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QUARTERLY FINANCIAL DATA (UNAUDITED)
($ in thousands except per share data)
FISCAL QUARTER FOR THE YEAR
------------------------------------------------------------------------------------------
1995 1ST 2ND 3RD 4TH
Net sales . . . . . . . . . . . $ 76,998 $ 81,755 $ 86,397 $ 83,081 $ 328,231
Gross profit . . . . . . . . . 15,657 17,055 17,893 17,506 68,111
Net income . . . . . . . . . . 3,623 4,278 4,674 4,596 17,171
Net income per share . . . . . $ .43 $ .50 $ .55 $ .54 $ 2.02
Average number of . . . . . . .
shares outstanding . . . . . 8,475 8,513 8,524 8,553 8,517
Fiscal Quarter For the Year
------------------------------------------------------------------------------------------
1994 1st 2nd 3rd 4th
Net sales . . . . . . . . . . . $ 60,328 $ 67,697 $ 70,902 $ 72,929 $ 271,856
Gross profit . . . . . . . . . 12,635 14,694 15,822 16,107 59,258
Net income . . . . . . . . . . 2,685 3,513 4,291 3,965 14,454
Net income per share . . . . . $ .32 $ .42 $ .51 $ .47 $ 1.72
Average number of
shares outstanding . . . . . 8,390 8,409 8,444 8,455 8,425
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