-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, PO2KZGUL6y4sEKkHdRzIBtOLepH4Z/PbCAyx5yYqAZpQ7bdGAMhmqsWuAiH8pXTo kZF8ePGo9py4OYuqMTUR1g== 0000753048-96-000014.txt : 19960514 0000753048-96-000014.hdr.sgml : 19960514 ACCESSION NUMBER: 0000753048-96-000014 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960513 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: ANALYTICAL SURVEYS INC CENTRAL INDEX KEY: 0000753048 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 840846389 STATE OF INCORPORATION: CO FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-13111 FILM NUMBER: 96561489 BUSINESS ADDRESS: STREET 1: 1935 JAMBOREE DR STREET 2: SUITE 100 CITY: COLORADO SPRINGS STATE: CO ZIP: 80920 BUSINESS PHONE: 7195930093 MAIL ADDRESS: STREET 1: 1935 JAMBOREE DRIVE STREET 2: SUITE 100 CITY: COLORADO SPRINGS STATE: CO ZIP: 80920 10QSB 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB __X__ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended March 31, 1996 or _____ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Commission File Number 0-13111 ANALYTICAL SURVEYS, INC. (Exact name of small business issuer as specified in its charter) Colorado 84-0846389 (State of incorporation) (IRS Employer Identification No.) 1935 Jamboree Drive Colorado Springs, Colorado 80920 (Address of principal executive offices) (Zip Code) (719) 593-0093 (Issuer's telephone number) Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 ninety (90) days. Yes __X__ No_____ The number of shares of common stock outstanding as of April 30, 1996 was 3,213,124. Part I Item 1.
ANALYTICAL SURVEYS, INC. BALANCE SHEETS (Unaudited) March 31, Sept. 30, 1996 1995 _________ _________ ASSETS CURRENT ASSETS Cash $ 414,264 $ 665,274 Accounts receivable, net of $20,000 allowance for doubtful accounts 3,741,007 2,925,094 Unbilled revenues 7,292,662 4,705,020 Prepaid expenses 569,109 209,343 Deferred tax assets 42,927 49,713 __________ __________ Total current assets 12,059,968 8,554,444 __________ __________ PROPERTY AND EQUIPMENT, at cost Equipment 6,134,055 5,656,521 Furniture and fixtures 848,165 735,313 Leasehold improvements 152,858 133,711 __________ __________ 7,135,078 6,525,545 __________ __________ Less Accumulated depreciation and amortization (5,498,136) (5,046,065) ___________ __________ 1,636,943 1,479,480 Goodwill, less accumulated amortization 3,042,029 13,751 __________ ___________ TOTAL ASSETS $ 16,738,940 $10,047,675 ========== ==========
[FN] See accompanying notes to financial statements.
ANALYTICAL SURVEYS, INC. BALANCE SHEETS (Unaudited) March 31, Sept. 30, 1996 1995 _________ _________ LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Notes payable to bank (Note 2) $ 175,000 $ -- Current maturities of long-term debt 751,405 417,100 Billings in excess of costs 701,472 176,934 Accounts payable and accrued expenses 1,999,084 1,560,227 Accrued payroll and benefits 800,026 661,951 __________ __________ Total current liabilities 4,426,987 2,816,212 Deferred income tax 49,989 113,290 Long-term debt, less current maturities 3,270,598 408,078 Deferred compensation 59,582 55,407 __________ __________ Total liabilities 7,807,156 3,392,987 __________ __________ STOCKHOLDERS' EQUITY Preferred stock-authorized 2,500,000 shares of no par value; none issued and outstanding Common stock-authorized 100,000,000 shares of no par value; issued and outstanding 3,167,599 shares at March 31, 1996 and 2,854,849 shares at September 30, 1995 5,028,469 3,461,100 Treasury stock - 23,500 shares, at cost (124,844) (124,844) Retained earnings 4,028,159 3,318,432 __________ __________ Total stockholders' equity 8,931,784 6,654,688 __________ __________ TOTAL LIABILITIES AND EQUITY $ 16,738,940 $10,047,675 ========== ==========
[FN] See accompanying notes to financial statements.
ANALYTICAL SURVEYS, INC. STATEMENTS OF OPERATIONS (Unaudited) Six Months Ended Three Months Ended March 31, March 31, 1996 1995 1996 1995 _________ _________ _________ _________ SALES OF SERVICES $9,333,147 $6,192,588 $5,684,513 $3,275,927 _________ _________ _________ _________ COSTS AND EXPENSES Salaries, wages and benefits 4,330,183 2,449,860 2,883,606 1,279,980 Subcontractor costs 1,681,637 1,554,310 747,012 798,081 General and administrative 1,541,791 1,101,380 967,428 554,682 Depreciation and amortization 510,973 387,685 293,851 199,486 _________ _________ _________ _________ 8,064,584 5,493,235 4,891,897 2,832,229 _________ _________ _________ _________ EARNINGS FROM OPERATIONS 1,268,563 699,353 792,616 443,698 _________ _________ _________ _________ OTHER INCOME (EXPENSE) Interest (125,905) (74,225) (97,634) (40,182) Miscellaneous Income 2,569 47 2,527 26 _________ _________ _________ _________ (123,336) (74,179) (95,107) (40,156) _________ _________ _________ _________ EARNINGS BEFORE INCOME TAXES 1,145,227 625,175 697,509 403,541 INCOME TAX EXPENSE 435,500 238,000 263,000 152,000 _________ _________ _________ _________ NET EARNINGS $ 709,727 $ 387,175 $ 434,509 $ 251,541 ========= ========= ========= ========= EARNINGS PER SHARE $ 0.22 $ 0.13 $ 0.13 $ 0.09 ==== ==== ==== ====
[FN] See accompanying notes to financial statements.
ANALYTICAL SURVEYS, INC. STATEMENTS OF CASH FLOWS (Unaudited) Six Months Ended Six Months Ended March 31, March 31, 1996 1995 _________ _________ CASH FLOWS PROVIDED (USED) BY OPERATING ACTIVITIES $ 2,227 $ 77,445 __________ _________ CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property and equipment (225,104) (443,434) Purchase of Intelligraphics (4,587,008) __________ _________ Net cash used in investing activities (4,812,112) (443,434) __________ _________ CASH FLOWS FROM FINANCING ACTIVITIES Net borrowings (payments) under notes payable 175,000 -- Proceeds from issuance of long-term debt 3,501,802 394,108 Principal payments of long-term debt (304,977) (341,679) Proceeds from issuance of common stock 1,187,058 284,220 __________ _________ Net cash provided (used) by financing activities 4,558,875 336,649 __________ _________ Net increase (decrease) in cash (251,010) (29,341) Cash at beginning of period 665,274 552,232 __________ _________ Cash at end of period $ 414,264 $ 522,891 ========== ========= Supplemental cash flow disclosures: Interest paid $ 123,869 $ 72,896 ========== ========= Income taxes paid $ 363,555 $ 554,200 ========== =========
[FN] See accompanying notes to financial statements. ANALYTICAL SURVEYS, INC. Quarterly Report on Form 10-QSB March 31, 1996 Notes to Financial Statements (Unaudited) 1. Summary of Significant Accounting Policies The accompanying interim financial statements have been prepared by management in accordance with the accounting policies described in the Company's annual report for the year ended September 30, 1995. They have not been audited by independent auditors. The financial statements reflect all adjustments which are, in the opinion of management, necessary to present fairly the financial position of Analytical Surveys, Inc. at March 31, 1996 and its results of operations for the six and three months ended March 31, 1996 and 1995, and its cash flows for the six months ended March 31, 1996 and 1995. All such adjustments are of a normal recurring nature. The Statement of Cash Flows for the six months ended March 31, 1995 includes certain reclassifications to conform the presentation to that used in the 1995 annual report and the current period. The computation of earnings per common share is based on the weighted average number of shares outstanding plus common stock equivalents as follows: Six months ended March 31, 1996 3,222,800 Six months ended March 31, 1995 2,888,000 Three months ended March 31, 1996 3,341,600 Three months ended March 31, 1995 2,897,000 2. Notes Payable to Bank Effective December 20, 1995, the Company renewed its line of credit loan agreement with its existing bank for one year and increased the maximum loan amount to $1,850,000. The interest rate is 0.5 percent above the bank's published prime lending rate and is variable with changes in that prime rate. On December 22, 1995, the Company borrowed $3,430,000 from a bank to fund substantially all of the cash portion of the purchase price of the acquisition described in note 3 below. The debt is to be repaid in monthly installments of $56,062 in the first year increasing to $57,356 in the fourth year. A final payment of $1,685,552 will be due at the end of the fourth year. Interest on this term debt is 0.6 percent above the bank's published prime lending rate and is variable with changes in that prime rate. 3. Acquisition On December 22, 1995 the Company acquired substantially all of the net operating assets of Intelligraphics Inc. of Waukesha, Wisconsin. The business operates as a division of the Company under the name of Intelligraphics International, a division of Analytical Surveys, Inc., is in substantially the same line of business as the Company and had sales of approximately $8,000,000 in calendar year 1995. Intelligraphics serves the utilities market with emphasis on electric distribution and telephone data conversion. The acquisition was recorded using the purchase method of accounting, and the financial statements include the operations of Intelligraphics from the date of acquisition, December 22, 1995 through the end of the period. The $4,558,875 consideration paid for the net assets acquired and related acquisition costs consisted of cash in the amount of $3,695,758 plus 230,000 shares of Analytical Surveys, Inc. no par value common stock, which shares are subject to restrictions on both transfer and voting rights for a period of two years. These restricted shares were recorded at $3.875 per share reflecting the effect of the restrictions on the fair market value of the shares. The acquisition included goodwill valued at $3,088,803 which will be amortized over a 15 year life using the straight line method. A portion of the consideration paid ($250,000 plus 70,000 of the restricted shares) is being held in escrow awaiting the satisfactory conclusion of certain pending matters. 4. Stock Options The following table summarizes stock option transactions under the Company's four non-qualified stock option plans: Shares Average under Option Price option per share Outstanding at September 30, 1995 711,275 Issued 4,000 $ 7.97 Exercised (106,250) 2.83 Canceled (8,625) 4.41 ------- Outstanding March 31, 1996 600,400 ======= At March 31, 1996: Options Exercisable 356,900 ======= Available for Grant 203,975 ======= ANALYTICAL SURVEYS, INC. Quarterly Report on Form 10-QSB March 31, 1996 Part I Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations: Three Months Ended March 31, 1996 Sales for the three months ended March 31, 1996 were 73% greater than sales for the same period one year ago. The primary reason for this increase is the acquisition of the Intelligraphics division in December 1995. Costs and expenses for the three months ended March 31, 1996 also increased 73% over the same period of the previous year, again due primarily to the Intelligraphics acquisition. There were changes in the mix of specific expense categories of the costs and expenses group. Salaries and wages increased from 39% of sales in 1995 to 51% of sales in 1996 due to the greater internal labor component of utilities conversion work. At the same time subcontractor costs decreased from 24% of sales in 1995 to 13% of sales in 1996 due to the lesser subcontractor component of the utilities work. These two categories taken together were 64% of sales in both 1995 and 1996. Depreciation and amortization includes approximately $52,000 in expense related to the amortization of the Intelligraphics goodwill. Interest expense increased 143% due to the term debt incurred as part of the Intelligraphics acquisition. Net income (all from continuing operations) for the three months ended March 31, 1996 of was 73% higher than the same period of the previous year due to the increased sales described above. Earnings per share increased 44%, which was less than the increase in net income due to the effect of shares issued in the acquisition, shares issued for stock option exercises and the effect of common stock equivalents on the average number of shares outstanding. Six Months Ended March 31, 1996 Net income (all from continuing operations) for the six months ended March 31, 1996 increased 83% over the first half of 1995. Increased production in the first quarter plus the effects of the Intelligraphics acquisition caused sales to increase 51% and earnings from operations to increase 81%. Salaries expense increased 77% due to the acquisition. Subcontractor costs increased only 8% due the lesser use of subcontractors in the utilities conversion work. The 40% increase in general and administrative expenses was primarily the result of the acquisition, increased selling and marketing activity and increased production. Interest expense was 70% more than the same period of the previous year due to the term debt incurred as part of the Intelligraphics acquisition. Earnings per share increased 69%, which was less than the increase in net income due to the effect of shares issued in the acquisition, shares issued for stock option exercises and the effect of common stock equivalents on the average number of shares outstanding. Cash flow provided by operations in the six months ended March 31, 1996 was $2,227 compared to $77,445 in the same six months of the previous year. Cash flow from operations was reduced by a $229,000 increase in prepaid income taxes offset by normal variations in investment in unbilled revenues and accounts receivable. The Company maintains an open line of credit to finance the investment in unbilled revenue and accounts receivable. The increase in current assets and current liabilities is attributable to the acquisition. Cash flow from investing activities includes the investment in the net assets of the new Intelligraphics division plus equipment acquisitions required by increased production at both locations. Cash flow from financing activities consists of the borrowing of cash and the issuance of shares to finance the acquisition of Intelligraphics as well as financing of equipment using capital leases, the scheduled repayment of debt and capitalized leases and proceeds from the exercise of stock options by employees. The Company's backlog of contracted work increased to $26,582,000 at March 31, 1996 up 94% from 1995 due to the acquisition of Intelligraphics and the increased volume of new contracts from both new and existing customers. Liquidity and Capital Resources: Management expects to meet long-term liquidity requirements through cash flows generated by operations supplemented from time to time by short term borrowings on a bank line of credit. Routine capital expenditures will usually be financed with term debt and/or capital leases. The Company is dependent, however, upon its ability to successfully deliver acceptable products in order to maintain adequate operating cash flows. The Company has not committed to significant capital expenditures at March 31, 1996. Part II Other Information Item 4. Submission of Matters to a Vote of Security Holders Three matters were voted upon at the Annual Meeting of Shareholders on February 20, 1996: (a) All nominees for director listed in the Company's proxy statement were elected; there was no solicitation in opposition to management's nominees. The following directors were re-elected to serve for one year or until the next election of directors: For Withheld John A. Thorpe 2,634,589 8,788 Richard P. MacLeod 2,633,920 9,457 James T. Rothe 2,634,043 9,334 Sidney V. Corder 2,634,033 9,344 Robert H. Keeley 2,634,043 9,334 Willem H. J. Andersen 2,634,043 9,334 (b) The proposal to ratify the selection of KPMG Peat Marwick LLP as the Company's independent accountants for the fiscal year ending September 30, 1996 was passed: For 2,600,597 Against 39,554 Abstain 3,226 (c) The proposal to ratify the Company's 1995 Non-Qualified Stock Option Plan was passed: For 2,465,868 Against 144,675 Abstain 32,834 Item 6. Exhibits and Reports on Form 8-K (a) Exhibits 7. Financial Data Schedule (b) Reports on Form 8-K One report on Form 8-K was filed during the three months ended March 31, 1996. A report on Form 8-K was filed January 8, 1996: Item 7. "Acquisition or Disposition of Assets" reporting the acquisition of the net assets of Intelligraphics, Inc. This report was amended on February 15, 1996 to add audited financial statements of Intelligraphics, Inc. and unaudited pro forma financial information. 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. Analytical Surveys, Inc. (Registrant) Date May 13, 1996 /s/ Sidney V. Corder ________________________ Sidney V, Corder, President and Chief Executive Officer Date May 13, 1996 /s/ Scott C. Benger ________________________ Scott C. Benger, Secretary/Treasurer (principal financial officer and principal accounting officer) Date May 13, 1996 /s/ Brian J. Yates ________________________ Brian J. Yates, Controller EX-27 2
5 This schedule contains summary financial information extracted from SEC Form 10-QSB and is qualified in its entirety by reference to such financial statements. 0000753048 ANALYTICAL SURVEYS INC 6-MOS SEP-30-1996 MAR-31-1996 414264 0 11053669 20000 0 12059968 7135078 5498136 16738940 4426987 0 4903625 0 0 4028159 16738940 0 9333147 0 8064584 (2569) 0 125905 1145227 435500 709727 0 0 0 709727 .22 .22
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