-----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, Jk/yqM2WNEX2GuXuO4MYbUmDowJMMkC6f1rCXfYtbPQtcSTI8hdzuxCae5i9yZZR KSfzVH9nOo+IPxaIWJHzyA== 0000798081-97-000001.txt : 19970611 0000798081-97-000001.hdr.sgml : 19970611 ACCESSION NUMBER: 0000798081-97-000001 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970430 FILED AS OF DATE: 19970610 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: LAKELAND INDUSTRIES INC CENTRAL INDEX KEY: 0000798081 STANDARD INDUSTRIAL CLASSIFICATION: ORTHOPEDIC, PROSTHETIC & SURGICAL APPLIANCES & SUPPLIES [3842] IRS NUMBER: 133115216 STATE OF INCORPORATION: DE FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-15535 FILM NUMBER: 97621713 BUSINESS ADDRESS: STREET 1: 711-2 KOEHLER AVENUE CITY: RONKONKOMA STATE: NY ZIP: 11779 BUSINESS PHONE: 5169819700 MAIL ADDRESS: STREET 1: 711- 2 KOEHLER AVENUE STREET 2: 711- 2 KOEHLER AVENUE CITY: RONKONKOMA STATE: NY ZIP: 11779 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10 - Q (Mark one) X QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 30, 1997 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: 0-15535 LAKELAND INDUSTRIES, INC. - --------------------------- (Exact name of Registrant as specified in it's charter) Delaware 13-3115216 - ----------- ----------- (State of incorporation)(IRS Employer Identification Number) 711-2 Koehler Avenue, Ronkonkoma, New York 11779 - ------------------------------------------------- (Address of principal executive offices) (516) 981-9700 - ------------------ (Registrant's telephone number, including area code) 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 the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: Common Stock, $.01 par value, outstanding at June 9, 1997 - 2,560,000 shares. LAKELAND INDUSTRIES, INC. AND SUBSIDIARIES FORM 10-Q The following information of the Registrant and its subsidiaries is submitted herewith: PART I - FINANCIAL INFORMATION: Item 1. Financial Statements: Page Introduction 1 Condensed Consolidated Balance Sheets - April 30, 1997 and January 31, 1997 2 Condensed Consolidated Statements of Income and Retained Earnings - Three Months Ended April 30, 1997 and 1996 3 Condensed Consolidated Statements of Cash Flows - Three Months Ended April 30, 1997 and 1996 4 Notes to Condensed Consolidated Financial Statements 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 6 PART II - OTHER INFORMATION: Item 6. Exhibits and Reports on Form 8-K None Signatures 7 LAKELAND INDUSTRIES, INC. AND SUBSIDIARIES PART I - FINANCIAL INFORMATION Item 1. Financial Statements: Introduction The condensed consolidated financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission and reflect all adjustments which are, in the opinion of management, necessary to present fairly the consolidated financial information required therein. Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended January 31, 1997. The results of operations for the three month periods ended April 30, 1997 and 1996 are not necessarily indicative of the results to be expected for the full year. LAKELAND INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS April 30, January 31, ASSETS 1997 1997 (unaudited) Current Assets: Cash $568,582 $504,940 Accounts receivable-trade, net of allowance for doubtful accounts of $150,000 at April 30, 1997 and January 31, 1997 6,417,874 5,893,594 Inventories 9,246,636 9,894,156 Deferred income taxes 469,000 469,000 Other current assets 247,659 176,901 ------- ------- Total current assets 16,949,751 16,938,591 Property and equipment, net of accumulated depreciation of $1,845,000 at April 30, 1997 and $1,763,000 January 31, 1997 1,041,192 989,667 Excess of cost over the fair value of net assets acquired, net of accumulated amortization of $203,000 at April 30, 1997 and $198,000 at January 31, 1997 342,120 347,116 Note receivable 138,575 140,298 Other assets 238,840 157,444 ------- ------- $18,710,478 $18,573,116 =========== =========== LIABILITIES & STOCKHOLDERS' EQUITY Current Liabilities: Accounts payable $1,554,481 $2,534,999 Current portion of long- term liabilities 50,000 50,000 Accrued expenses and other current liabilities 695,002 335,314 -------- --------- Total current liabilities 2,299,483 2,920,313 --------- --------- Long-term liabilities 6,033,289 5,745,789 --------- --------- Deferred income taxes 82,000 82,000 ------ ------ Commitments and Contingencies Stockholders' Equity Preferred stock, $.01 par; authorized 1,500,000 shares (none issued) Common stock, $.01 par; authorized 10,000,000 shares; issued and outstanding 2,550,000 shares 25,500 25,500 Additional paid in capital 5,981,226 5,981,226 Retained earnings 4,288,980 3,818,288 --------- --------- Total stockholders' equity 10,295,706 9,825,014 ---------- --------- $18,710,478 $18,573,116 =========== =========== See notes to condensed consolidated financial statements. LAKELAND INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND RETAINED EARNINGS (UNAUDITED) THREE MONTHS ENDED April 30, 1997 1996 Net Sales $12,013,629 $10,541,662 Cost of Goods Sold 9,707,638 8,441,875 --------- --------- Gross Profit 2,305,991 2,099,787 Operating Expenses 1,450,409 1,308,772 --------- --------- Income from Operations 855,582 791,015 Other Income/(expense), net 15,965 15,257 Interest Expense (100,855) (122,447) --------- --------- Income before income taxes 770,692 683,825 Provision for income taxes 300,000 266,000 ------- ------- Net Income 470,692 417,825 Retained earnings at beginning of period 3,818,288 2,754,992 --------- --------- Retained earnings at end of period $4,288,980 $3,172,817 ========== ========== Income per common and common equivalent share $.18 $.16 ==== ==== Number of common and common equivalent shares outstanding 2,598,591 2,579,407 ========= ========= See notes to condensed consolidated financial statements. LAKELAND INDUSTRIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) THREE MONTHS ENDED April 30, 1997 1996 Cash Flows from Operating Activities: Net Income $470,692 $417,825 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization 86,648 79,119 Decrease (increase) in accounts receivable (524,280) (62,300) Decrease (increase) in inventories 647,520 (666,147) Decrease (increase) in other current assets (70,758) 290,376 Decrease (increase) in other assets (79,673) - Increase (decrease) in accounts payable, accrued expenses and other current liabilities (620,830) (432,647) --------- --------- Net cash used in operating activities (90,681) (373,774) Cash Flows from Investing Activities - Purchases of property and equipment - net (120,677) (96,138) Cash Flows from Financing Activities: Net borrowings (reduction)under line of credit agreement 275,000 252,500 ------- ------- Net increase (decrease) in cash 63,642 (217,412) Cash at beginning of period 504,940 364,640 ------- ------- Cash at end of period $568,582 $147,228 ======== ======== See notes to condensed consolidated financial statements. LAKELAND INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) A. Inventories: Inventories consist of the following: April 30, January 31, 1997 1997 Raw materials $2,649,863 $2,669,254 Work in process 3,651,766 3,124,141 Finished goods 2,945,007 4,100,761 --------- --------- $9,246,636 $9,894,156 Inventories are stated at the lower of cost or market. Cost is determined generally on the first-in, first-out method. B. Earnings Per Common and Common Equivalent Share: Earnings per share for the three month periods ended April 30, 1997 and 1996 is based on the weighted average number of common shares outstanding and common share equivalents. C. Revolving Credit Facility: At April 30, 1997, the balance outstanding under the Company's secured revolving credit facility amounted to $5,675,000. The Company was in compliance with all loan covenants at April 30, 1997. This facility is collateralized by the Company's inventory and accounts receivable and expires on July 31, 1998. Interest charges under this credit facility are calculated on various optional formulas using the prime rate, LIBOR, bankers' acceptance and letters of credit. D. New Accounting Pronouncement: In February 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 128, "Earnings Per Share", which is effective for financial statements for both interim and annual periods ending after December 15, 1997. Early adoption of the new standard is not permitted. The new standard eliminates primary and fully diluted earnings per share and requires presentation of basic and diluted earnings per share together with disclosure of how the per share amounts were computed holders by the weighted-average common shares outstanding for the period. Diluted earnings per share reflect the weighted-average common shares outstanding, plus the potential dilutive effect of options which are convertible to common shares. The effect of adopting this new standard has not been determined. LAKELAND INDUSTRIES, INC. AND SUBSIDIARY MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Three months ended April 30, 1997 compared to the three months ended April 30, 1996: Net sales for the quarter ended April 30, 1997 increased $1,472,000 or 14% to $12,014,000 from $10,542,000 reported for the corresponding period of the prior year. Steadying of the customer base and increased unit shipments of various protective garment products are the principle reasons for the change. The Company believes that a decrease in unit shipments negatively affecting sales during the first quarter of fiscal 1997 was primarily attributable to the Federal Government's partial shut-down between October 1995 and April 1996. This affected direct agency purchasing and government contractors and subcontractors purchasing in the Company's industry in the prior year period. This industry continues to be highly competitive. Net sales increased 6.9% during the quarter ended April 30, 1997 as compared to the immediate preceding quarter, principally due to volume. However, gross profit as a percentage of net sales decreased to 19.2% for the quarter ended April 30, 1997 from 19.9% reported for the corresponding period of the prior year, principally due to some products imported for sale during the current year quarter being sold at lower margins. Gross profit margins increased by 4.5% during the quarter ended April 30, 1997 from the immediate preceding quarter, principally due to the increase in sales volume. Operating expenses as a percentage of net sales decreased to 12.1% for the quarter ended April 30, 1997 from 12.4% for the corresponding period of the prior year, as sales increased by 14% and selling and general and administrative expenses increased by only 10.8%. Interest expense decreased as borrowing decreased during the current year quarter. As a result of the foregoing, net income increased to $471,000 for the quarter ended April 30, 1997 from $418,000 from the corresponding period of the prior year. LIQUIDITY and CAPITAL RESOURCES Lakeland has historically met its cash requirements through funds generated from operations and borrowings under a revolving credit facility. On August 30, 1995, the Company entered into a new $8 million facility with its Bank. This facility matures on July 31, 1998. Interest charges under this credit facility are calculated on various optional formulas using the prime rate, LIBOR, banker's acceptances and letters of credit. The Company's April 30, 1997 balance sheet shows a strong current ratio and working capital position and management believes that its positive financial position, together with its credit agreement, will provide sufficient funds for operating purposes for the next twelve months. Item 6. Exhibits and Reports on Form 8-K: a - None b - No reports on Form 8-K were filed during the three month period ended April 30, 1997 SIGNATURES Pursuant to the requirements of Section 13 or 15 (d) 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. LAKELAND INDUSTRIES, INC. (Registrant) Date: June 10, 1997 Raymond J. Smith ------------------ Raymond J. Smith President and Chief Executive Officer Date: June 10, 1997 James M. McCormick, ------------------- James M. McCormick Vice President and Treasurer(Principal Accounting Officer) EX-27 2
5 The schedule contains summary financial information extracted from [identify specific financial statement[s]] and is qualified in its entirety by reference to such financial statement[s]. 3-MOS JAN-31-1997 APR-30-1997 568,582 0 6,417,874 0 9,246,636 16,949,751 1,041,192 0 18,710,478 2,299,483 0 0 0 25,500 5,981,226 10,295,706 12,013,629 12,013,629 9,707,628 9,707,638 1,450,409 0 100,855 770,692 300,000 470,692 0 0 0 470,692 .18 .18
-----END PRIVACY-ENHANCED MESSAGE-----