UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
[X] | QUARTERLY EXCHANGE REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended April 5, 2003
or
[ ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number 1-8120
BAIRNCO CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 13-3057520
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
300 Primera Boulevard, Suite 432, Lake Mary, FL 32746
(Address of principal executive offices) (Zip Code)
(407) 875-2222
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No
Indicate by check mark whether the Registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes __No X
(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDING DURING THE PRECEDING FIVE YEARS)
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13, or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.
Yes No
(APPLICABLE ONLY TO CORPORATE ISSUERS)
Indicate the number of shares outstanding of each issuer's classes of common stock, as of the latest practicable date.
7,333,939 shares of Common Stock Outstanding as of April 22, 2003.
&nbs p;
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“Safe Harbor” Statement under the Private Securities Reform Act of 1995
Certain of the statements contained in this Quarterly Report (other than the financial statements and statements of historical fact), including, without limitation, statements as to management expectations and beliefs presented under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, are forward-looking statements. Forward-looking statements are made based upon management’s expectations and belief concerning future developments and their potential effect upon the Corporation. There can be no assurance that future developments will be in accordance with management’s expectations or that the effect of future developments on the Corporation will be those anticipated by management.
The Corporation wishes to caution readers that the assumptions which form the basis for forward-looking statements with respect to or that may impact earnings for the year ended December 31, 2003 and thereafter include many factors that are beyond the Corporation’s ability to control or estimate precisely. These risks and uncertainties include, but are not limited to, changes in US or international economic or political conditions, such as the general level of economic activity, inflation or fluctuations in interest or foreign exchange rates; the costs and other effects of legal and administrative cases and proceedings, settlements and investigations; disruptions in operations due to labor disputes; the market demand and acceptance of the Corporation’s existing and new products; change s in the pricing of the products of the Corporation or its competitors; the impact of competitive products; the impact on production output and costs from the availability of energy sources and related pricing; changes in the market for raw or packaging materials which could impact the Corporation’s manufacturing costs; changes in the product mix; the loss of a significant customer or supplier; production delays or inefficiencies; the ability to achieve anticipated revenue growth, synergies and other cost savings in connection with acquisitions or reorganizations; the costs and other effects of complying with environmental regulatory requirements; and losses due to natural disasters where the Corporation is self-insured.
While the Corporation periodically reassesses material trends and uncertainties affecting the Corporation’s results of operations and financial condition in connection with its preparation of management’s discussion and analysis contained in its quarterly reports, the Corporation does not intend to review or revise any particular forward-looking statement referenced herein in light of future events.
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PART I - FINANCIAL INFORMATION
Item 1:
FINANCIAL STATEMENTS
BAIRNCO CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE QUARTERS ENDED APRIL 5, 2003 AND MARCH 30, 2002
(Unaudited)
2003 | 2002 | |
Net Sales | $ 39,972,000 | $ 36,617,000 |
Cost of sales | 28,392,000 | 26,026,000 |
Gross Profit | 11,580,000 | 10,591,000 |
Selling and administrative expenses | 10,093,000 | 9,331,000 |
Operating Profit | 1,487,000 | 1,260,000 |
Interest expense, net | 199,000 | 273,000 |
Income before Income Taxes | 1,288,000 | 987,000 |
Provision for income taxes | 399,000 | 306,000 |
Net Income | $ 889,000 | $ 681,000 |
Earnings per Share of Common Stock (Note 2): | ||
Basic | $ 0.12 | $ 0.09 |
Diluted | $ 0.12 | $ 0.09 |
Weighted Average Number of Shares Outstanding: | ||
Basic | 7,334,000 | 7,329,000 |
Diluted | 7,336,000 | 7,334,000 |
Dividends per Share of Common Stock | $ 0.05 | $ 0.05 |
The accompanying notes are an integral part of these financial statements.
BAIRNCO CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE QUARTERS ENDED APRIL 5, 2003 AND MARCH 30, 2002
(Unaudited)
Note 3
2003 | 2002 | |
Net income | $ 889,000 | $ 681,000 |
Other comprehensive income (loss), net of tax: | ||
Foreign currency translation adjustment | 48,000 | (140,000) |
Comprehensive income | $ 937,000 | $ 541,000 |
The accompanying notes are an integral part of these financial statements.
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BAIRNCO CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
AS OF APRIL 5, 2003 AND DECEMBER 31, 2002
Unaudited | ||
2003 | 2002 | |
ASSETS | ||
Current Assets: | ||
Cash and cash equivalents | $ 746,000 | $ 705,000 |
Accounts receivable, less allowances of $1,417,000 and $1,295,000, respectively | 24,439,000 |
22,732,000 |
Inventories | 26,251,000 | 24,882,000 |
Deferred income taxes | 4,910,000 | 4,910,000 |
Other current assets | 4,351,000 | 3,779,000 |
Total current assets | 60,697,000 | 57,008,000 |
Plant and equipment, at cost | 111,784,000 | 110,096,000 |
Accumulated depreciation and amortization | (74,413,000) | (72,628,000) |
Plant and equipment, net | 37,371,000 | 37,468,000 |
Cost in excess of net assets of purchased businesses, net | 13,391,000 | 13,276,000 |
Other assets | 7,463,000 | 7,832,000 |
$ 118,922,000 | $ 115,584,000 | |
LIABILITIES & STOCKHOLDERS' INVESTMENT | ||
Current Liabilities: | ||
Short-term debt | $ 1,585,000 | $ 1,200,000 |
Current maturities of long-term debt | 8,250,000 | 7,000,000 |
Accounts payable | 11,774,000 | 9,855,000 |
Accrued expenses | 12,930,000 | 15,103,000 |
Total current liabilities | 34,539,000 | 33,158,000 |
Long-term debt | 20,972,000 | 19,547,000 |
Deferred income taxes | 9,265,000 | 9,258,000 |
Other liabilities | 2,060,000 | 2,105,000 |
Commitments and contingencies | ||
Stockholders’ Investment: | ||
Preferred stock, par value $.01, 5,000,000 shares authorized, none issued | -- | -- |
Common stock, par value $.01, 30,000,000 shares authorized, 11,371,808 shares issued | 114,000 | 114,000 |
Paid-in capital | 50,197,000 | 50,197,000 |
Retained earnings | 35,089,000 | 34,567,000 |
Accumulated Other Comprehensive Income (Loss)- | ||
Currency translation adjustment | 1,473,000 | 1,425,000 |
Minimum pension liability adjustment, net of $24,000 tax | (42,000) | (42,000) |
Treasury stock, at cost, 4,037,869 shares | (34,745,000) | (34,745,000) |
Total stockholders’ investment | 52,086,000 | 51,516,000 |
$ 118,922,000 | $ 115,584,000 |
The accompanying notes are an integral part of these financial statements.
BAIRNCO CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
FOR THE QUARTERS ENDED APRIL 5, 2003 AND MARCH 30, 2002
(Unaudited)
2003 | 2002 | ||
Cash Flows from Operating Activities: | |||
Net income | $ 889,000 | $ 681,000 | |
Adjustments to reconcile to net cash provided by | |||
Operating activities: | |||
Depreciation and amortization | 1,990,000 | 2,052,000 | |
Loss (gain) on disposal of plant and equipment | 31,000 | (4,000) | |
Deferred income taxes | -- | -- | |
Change in current assets and liabilities, net of effect of acquisitions: | |||
(Increase) decrease in accounts receivable | (1,609,000) | 233,000 | |
(Increase) in inventories | (1,285,000) | (386,000) | |
(Increase) in other current assets | (570,000) | (838,000) | |
Increase in accounts payable | 1,882,000 | 653,000 | |
(Decrease) in accrued expenses | (1,845,000) | (480,000) | |
Other | 321,000 | 115,000 | |
Net cash (used in) provided by operating activities | (196,000) | 2,026,000 | |
Cash Flows from Investing Activities: | |||
Capital expenditures | (1,918,000) | (861,000) | |
Proceeds from sale of plant and equipment | 1,000 | 19,000 | |
Payment for purchased businesses | (70,000) | (127,000) | |
Net cash (used in) investing activities | (1,987,000) | (969,000) | |
Cash Flows from Financing Activities: | |||
Net increase (decrease) in short-term debt | 359,000 | (2,802,000) | |
Proceeds from long-term debt | 3,000,000 | 4,500,000 | |
Long-term debt repayments | (320,000) | (1,540,000) | |
Payment of dividends | (734,000) | (733,000) | |
Net cash provided by (used in) financing activities | 2,305,000 | (575,000) | |
Effect of foreign currency exchange rate changes on cash and cash equivalents | (81,000) | (30,000) | |
Net increase in cash and cash equivalents | 41,000 | 452,000 | |
Cash and cash equivalents, beginning of period | 705,000 | 756,000 | |
Cash and cash equivalents, end of period | $ 746,000 | $ 1,208,000 |
The accompanying notes are an integral part of these financial statements.