-----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, VBqxeqT07Htnqouq/6n4ErEyzP49aTdOQ1ZUl3bROSipuYS8IB7Ol3m/Zulmg1B3 6MxejwQti7CpR2N/3FJjWA== 0000897101-97-000983.txt : 19970912 0000897101-97-000983.hdr.sgml : 19970912 ACCESSION NUMBER: 0000897101-97-000983 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970731 FILED AS OF DATE: 19970908 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: RAVEN INDUSTRIES INC CENTRAL INDEX KEY: 0000082166 STANDARD INDUSTRIAL CLASSIFICATION: APPAREL & OTHER FINISHED PRODS OF FABRICS & SIMILAR MATERIAL [2300] IRS NUMBER: 460246171 STATE OF INCORPORATION: SD FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-07982 FILM NUMBER: 97676751 BUSINESS ADDRESS: STREET 1: 205 E 6TH ST STREET 2: PO BOX 5107 CITY: SIOUX FALLS STATE: SD ZIP: 57117 BUSINESS PHONE: 6053362750 MAIL ADDRESS: STREET 1: P O BOX 5107 CITY: SIOUX FALLS STATE: SD ZIP: 57117-5107 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 (Mark One) (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED: JULY 31, 1997 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ___________________________ Commission file number: 0-3136 RAVEN INDUSTRIES, INC. ------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) SOUTH DAKOTA 46-0246171 - ------------------------------------------------- ----------------------- (State or other jurisdiction of incorporation (I.R.S. Employer or organization) Identification No.) 205 EAST 6TH STREET P.O. BOX 5107 SIOUX FALLS, SD 57117-5107 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip code) 605-336-2750 - -------------------------------------------------------------------------------- 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 ____ APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. CLASS OUTSTANDING AS OF JULY 31, 1997 - ---------------------------- ------------------------------- Common Stock 4,850,992 shares RAVEN INDUSTRIES, INC. AND SUBSIDIARIES INDEX PAGE NO. PART I-FINANCIAL INFORMATION Consolidated Balance Sheets as of July 31, 1997, January 31, 1997 and July 31, 1996 3 Consolidated Statements of Income for the three months and six months ended July 31, 1997 and 1996 4 Consolidated Statements of Cash Flows for the six months ended July 31, 1997 and 1996 5 Notes to Consolidated Financial Statements 6 Computations of Earnings Per Common Share 7 Management's Discussion and Analysis of Financial Condition and Results of Operations 8-9 PART II-OTHER INFORMATION 10 PART I - FINANCIAL INFORMATION RAVEN INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Dollars in thousands except per share data)
7/31/97 01/31/97 7/31/96 ------- ------- ------- ASSETS Cash and cash equivalents ................................... $ 2,645 $ 3,439 $ 2,929 Accounts receivable, less allowance for doubtful accounts of $345, $340 and $340 .................. 18,816 25,637 15,605 Inventories: Materials ................................................. 18,637 16,276 15,886 In process ................................................ 5,013 4,574 5,660 Finished goods ............................................ 7,937 4,275 6,522 ------- ------- ------- Total inventories ..................................... 31,587 25,125 28,068 Prepaid expenses and other current assets ................... 435 431 493 Deferred income taxes ....................................... 2,064 2,064 1,579 ------- ------- ------- Total current assets .................................. 55,547 56,696 48,674 ------- ------- ------- Property, plant and equipment ............................... 50,339 48,315 47,253 Less: accumulated depreciation ............................ 32,062 30,173 28,998 ------- ------- ------- Net property, plant and equipment ..................... 18,277 18,142 18,255 Other assets, net ........................................... 5,728 5,824 3,655 ------- ------- ------- TOTAL ASSETS ................................................ $79,552 $80,662 $70,584 ======= ======= ======= LIABILITIES AND STOCKHOLDERS' EQUITY Current portion of long-term debt ........................... $ 757 $ 1,366 $ 813 Accounts payable ............................................ 5,789 7,849 6,074 Accrued liabilities and customer advances ................... 10,352 10,801 8,871 ------- ------- ------- Total current liabilities ............................. 16,898 20,016 15,758 Long-term debt, less current portion ........................ 2,610 3,181 2,682 Deferred income taxes ....................................... 736 736 815 Stockholders' equity Common stock, $1 par value, authorized shares: 100,000,000; issued: 5,203,395; 5,187,961 and 5,083,982 shares ........ 5,203 5,188 5,084 Paid in capital ........................................... 2,758 2,673 614 Retained earnings ......................................... 54,257 51,778 48,541 ------- ------- ------- 62,218 59,639 54,239 Less treasury stock, at cost: 352,403 shares ........................................ 2,910 2,910 2,910 ------- ------- ------- Total stockholders' equity ............................ 59,308 56,729 51,329 ------- ------- ------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY .................. $79,552 $80,662 $70,584 ======= ======= =======
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. PART I - FINANCIAL INFORMATION RAVEN INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (Dollars in thousands except per share data)
FOR THE THREE FOR THE SIX MONTHS ENDED: MONTHS ENDED: --------------------------- --------------------------- 07/31/97 07/31/96 07/31/97 07/31/96 ----------- ----------- ----------- ----------- Net sales ................... $ 34,075 $ 31,270 $ 69,741 $ 62,145 Cost of goods sold .......... 28,000 25,872 56,839 50,661 ----------- ----------- ----------- ----------- Gross profit .............. 6,075 5,398 12,902 11,484 Operating expenses Selling ................... 2,018 1,696 3,954 3,450 Administrative ............ 1,650 1,487 3,253 2,993 ----------- ----------- ----------- ----------- Operating income ....... 2,407 2,215 5,695 5,041 Interest expense ............ (78) (72) (166) (141) Other income, net ........... 147 48 281 88 ----------- ----------- ----------- ----------- Income before income taxes 2,476 2,191 5,810 4,988 Income taxes ................ 874 782 2,074 1,771 ----------- ----------- ----------- ----------- Net income ................ $ 1,602 $ 1,409 $ 3,736 $ 3,217 =========== =========== =========== =========== Average number of common and common-equivalent shares outstanding ............... 4,893,072 4,759,281 4,879,296 4,751,983 =========== =========== =========== =========== Net income per common and common-equivalent share ... $ 0.33 $ 0.30 $ 0.77 $ 0.68 =========== =========== =========== =========== Cash dividends paid per share $ 0.130 $ 0.120 $ 0.260 $ 0.240 =========== =========== =========== ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. PART I - FINANCIAL INFORMATION RAVEN INDUSTRIES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Dollars in thousands)
FOR THE SIX MONTHS ENDED: ------------------- 7/31/97 7/31/96 ------- ------- Cash flows from operating activities: Net income .......................................... $ 3,736 $ 3,217 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization ................... 2,660 2,374 Provision for losses on accounts receivable ..... 101 45 Equity in earnings of affiliate, net of dividends (100) 24 (Increase) decrease in accounts receivable ...... 6,720 352 (Increase) decrease in inventories .............. (6,462) (4,171) (Increase) decrease in other current assets ..... (4) (80) Increase (decrease) in operating liabilities .... (2,509) 987 Other ........................................... (11) 48 ------- ------- Net cash provided by (used in) operating activities . 4,131 2,796 Cash flows from investing activities: Capital expenditures ................................ (2,750) (2,536) Intangible asset expenditures and other ............. 166 38 ------- ------- Net cash provided by (used in) investing activities . (2,584) (2,498) Cash flows from financing activities: Long-term debt principal payments ................... (1,184) (134) Proceeds from exercise of stock options ............. 100 94 Dividends paid ...................................... (1,257) (1,133) ------- ------- Net cash provided by (used in) financing activities . (2,341) (1,173) ------- ------- Net increase (decrease) in cash and equivalents ..... (794) (875) Cash and cash equivalents at beginning of period ...... 3,439 3,804 ------- ------- Cash and cash equivalents at end of period ............ $ 2,645 $ 2,929 ======= ======= Cash paid during the period for: Interest .......................................... $ 181 $ 146 Income taxes ...................................... $ 2,693 $ 2,167
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE FINANCIAL STATEMENTS. PART I - FINANCIAL INFORMATION RAVEN INDUSTRIES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (SEC). Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring entries) considered necessary for a fair presentation have been included. Operating results for the three month and six month periods ended July 31, 1997 are not necessarily indicative of the results that may be expected for the year ending January 31, 1998. For further information, refer to the consolidated financial statements and notes thereto included in the Company's annual report on Form 10-K for the year ended January 31, 1997. 2. In March 1997, the Financial Accounting Standards Board issued Statement No. 128 "Earnings per Share," which the Company will adopt effective for its fiscal 1998 year end reporting. The Company will be required to report basic net income per share based on weighted average common shares outstanding, without considering common equivalent shares, and diluted net income per share based on weighted average common and common equivalent shares outstanding. Diluted net income per share would be equivalent to the Company's current reporting of net income per common and common-equivalent share. PART I - FINANCIAL INFORMATION RAVEN INDUSTRIES, INC. AND SUBSIDIARIES COMPUTATIONS OF EARNINGS PER COMMON SHARE (UNAUDITED) (Dollars in thousands except per share data)
FOR THE THREE FOR THE SIX MONTHS ENDED: MONTHS ENDED: ------------------------ ------------------------ 7/31/97 7/31/96 7/31/97 7/31/96 ---------- ---------- ---------- ---------- Net income ........................................... $ 1,602 $ 1,409 $ 3,736 $ 3,217 ========== ========== ========== ========== Earnings per common share - Primary ........................................ $ 0.33 $ 0.30 $ 0.77 $ 0.68 ========== ========== ========== ========== Earnings per common share - Fully diluted (1) .............................. $ 0.33 $ 0.30 $ 0.77 $ 0.68 ========== ========== ========== ========== Average number of common and common equivalent shares: Primary: Weighted average common shares outstanding .............................. 4,842,691 4,726,325 4,839,833 4,721,255 Dilutive effect of exercise of certain stock options ........................ 50,381 32,956 39,463 30,728 ---------- ---------- ---------- ---------- Average common shares - Primary ....................................... 4,893,072 4,759,281 4,879,296 4,751,983 ========== ========== ========== ========== Fully diluted (1): Weighted average common shares outstanding .............................. 4,842,691 4,726,325 4,839,833 4,721,255 Dilutive effect of exercise of certain stock options ........................ 54,186 32,956 41,366 30,728 ---------- ---------- ---------- ---------- Average common shares - Fully diluted ................................. 4,896,877 4,759,281 4,881,199 4,751,983 ========== ========== ========== ==========
(1) THIS CALCULATION IS SUBMITTED IN ACCORDANCE WITH REGULATION S-K ITEM 601(b)(11) ALTHOUGH NOT REQUIRED BY FOOTNOTE 2 TO PARAGRAPH 14 OF APB OPINION NO. 15 BECAUSE IT RESULTS IN DILUTION OF LESS THAN 3%. PART I - FINANCIAL INFORMATION MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FINANCIAL CONDITION The company's cash balance was $2.6 million at July 31, 1997, compared to $2.9 million one year earlier. Net cash provided by operating activities was $4.1 million for the six months ended July 31, 1997, an increase of $1.3 million over the period ended July 31, 1996. Higher earnings and collection of year-end accounts receivable balances accounted for much of the improvement. The company prepaid $1 million of long-term debt due in January, 1998 during the second quarter of the current fiscal year. The company's capital resources continue to be sufficient to fund all operating activities. RESULTS OF OPERATIONS Sales were $34.1 million in the quarter ended July 31, 1997, an increase of 9 percent over the second quarter of the prior year. First half sales of $69.7 million were 12 percent higher than the comparable period of the prior fiscal year. Most of the sales increase was in the Plastics segment. Net income of $1.6 million in the second quarter was 14 percent higher than the prior year's second quarter and earnings per share of $.33 was up 10 percent. For the six months, net income of $3.7 million increased 16 percent and earnings per share of $.77 increased 13 percent over the comparable period of the prior year. The increase in the number of average shares outstanding was due primarily to the issuance of 93,701 shares of common stock in connection with the January, 1997 acquisition of Norcore Plastics, Inc. Plastics segment sales of $16.6 million in the second quarter were 17 percent higher than the year earlier period. The acquisition of Norcore Plastics added $1.8 million to sales in this segment during the quarter and $4.5 million during the first half of the year. Excluding the impact of the acquisition, sales of plastic and fiberglass tanks, and engineered films increased. First half sales of $34.6 million in this segment were 23 percent higher than the first half of the prior year. Second quarter operating income of $989,000 was 8 percent lower than the comparable period of the prior year in the Plastics segment. The profit impact of higher sales was offset by increased selling expenses and lower gross profit rates. Six month operating income was $2.0 million in this segment, 4 percent less than the first six months of the prior fiscal year. Electronics segment sales of $9.0 million in the second quarter were 1 percent lower than the prior year. A small increase in the company's product lines in support of precision farming was offset by delayed demand from contract manufacturing customers. Contract manufacturing revenues are projected to increase during the second half of the year. For the six months, sales of $21.2 million were essentially unchanged from one year earlier. Operating income of $490,000 in the second quarter was 10 percent higher than the prior year's comparable quarter. Improved operating efficiencies offset the impact of lower sales. First half operating income in the Electronics segment of $2.5 million was 12 percent higher than the first six months of the prior year. PART I - FINANCIAL INFORMATION MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued) Sewn Products sales of $8.4 million were 5 percent higher in the second quarter of the current year and up 9 percent for the six month period, totaling $14.0 million. Operating income was $928,000 for the quarter and $1.2 million for the six months, an increase of 34 percent and 59 percent, respectively, over the comparable periods of the prior year. The first half of the year is the seasonal low for Sewn Products deliveries, therefore the percentage increases are reflective of the timing of deliveries. Full year projections for this segment continue to indicate sales approximating fiscal 1997 levels. Consolidated gross profits were up 13 percent in the second quarter and 12 percent in the first half compared to one year earlier, due to the higher sales levels in the Plastics and Sewn Products segments and improved gross profit rates in the Electronics and Sewn Products segments. Selling expenses increased, from 5.4 percent of sales in the second quarter of the prior year to 5.9 percent in the most recent quarter, to improve future growth opportunities in the Electronics and Plastics segments. Administrative expenses were 4.8 percent of sales in both the most recent and prior year's second quarter. On a year to date basis, selling and administrative expenses are relatively unchanged as a percentage of sales. Miscellaneous income increased by $99,000 in the second quarter and $193,000 for the six months, due primarily to improved results at the company's 50 percent owned affiliate. Consolidated income before income taxes increased by 13 percent in the second quarter and 16 percent for the six month period when compared to the same periods in the previous fiscal year. SAFE HARBOR STATEMENT THIS REPORT CONTAINS DISCUSSIONS OF ITEMS WHICH MAY CONSTITUTE FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF FEDERAL SECURITIES LAWS. ALTHOUGH RAVEN INDUSTRIES BELIEVES THAT EXPECTATIONS REFLECTED IN SUCH FORWARD-LOOKING STATEMENTS ARE BASED ON REASONABLE ASSUMPTIONS, IT CAN GIVE NO ASSURANCES THAT ITS EXPECTATIONS WILL BE ACHIEVED. FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER FROM EXPECTATIONS INCLUDE GENERAL ECONOMIC CONDITIONS, WEATHER CONDITIONS WHICH COULD AFFECT CERTAIN OF THE COMPANY'S PRIMARY MARKETS SUCH AS THE AGRICULTURAL MARKET OR ITS MARKET FOR OUTERWEAR, OR CHANGES IN COMPETITION WHICH COULD IMPACT ANY OF THE COMPANY'S PRODUCT LINES. PART II-OTHER INFORMATION Item 1. Legal Proceedings: None Item 2. Changes in Securities: None Item 3. Defaults upon Senior Securities: None Item 4. Submission of Matters to a Vote of Security Holders: The Company's annual meeting of stockholders was held on May 22, 1997. The following members were elected to the Company's Board of Directors to hold office for the ensuing year. Nominee In Favor Withheld - --------------------------------- ----------- --------- Tony W. Bour 4,280,137 77,539 David A. Christensen 4,285,072 72,604 Mark E. Griffin 4,282,437 75,239 Thomas S. Everist 4,277,437 80,239 Conrad J. Hoigaard 4,281,643 76,033 Kevin T. Kirby 4,282,137 75,539 John C. Skoglund 4,281,643 76,033 Item 5. Other Information: None Item 6. (a) Exhibits Filed: Exh. 27-Financial Data schedule (for SEC only). (See Part 1, page 7 for Earnings Per Share computation) (b) Reports on Form 8-K: None 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. RAVEN INDUSTRIES, INC. /s/ Arnold J. Thue ---------------------------------- Arnold J. Thue Vice President, Finance, Secretary and Treasurer (Principal Financial and Accounting Officer) DATE: SEPTEMBER 8, 1997 EX-27 2 FINANCIAL DATA SCHEDULE
5 1,000 6-MOS JAN-31-1998 JUL-31-1997 2,645 0 19,161 345 31,587 55,547 50,339 32,062 79,552 16,898 2,610 0 0 5,203 54,105 79,552 69,741 69,741 56,839 56,839 0 0 166 5,810 2,074 3,736 0 0 0 3,736 0.77 0.77
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