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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the quarterly period ended |
April 30,2005 |
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OR |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the transition period from |
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to |
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Commission file number |
0-18370 |
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MFRI, INC. |
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(Exact name of registrant as specified in its charter) |
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Delaware |
36-3922969 |
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(State or other jurisdiction of
incorporation or organization) |
(I.R.S. Employer
Identification No.) |
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7720 Lehigh Avenue |
Niles, Illinois |
60714 |
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(Address of principal executive offices) |
(Zip Code) |
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(847) 966-1000 |
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(Registrant’s telephone number, including area code) |
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(Former name, former address and former fiscal year, if changed since last report) |
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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
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Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes No X
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On June 10, 2005, there were 5,248,308 shares of the registrant’s common stock outstanding. |
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PART I – FINANCIAL INFORMATION
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Item 1. |
Financial Statements |
The accompanying interim condensed consolidated financial statements of MFRI, Inc. and subsidiaries (the “Company”) are unaudited, but include all adjustments which the Company’s management considers necessary to present fairly the financial position and results of operations for the periods presented. These adjustments consist of normal recurring adjustments. Certain information and footnote disclosures have been condensed or omitted pursuant to Securities and Exchange Commission rules and regulations. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s annual report on Form 10-K for the year ended January 31, 2005. Reclassifications have been made in prior-year financial statements to conform to the current-year presentation. The results of operations for the quarter
ended April 30, 2005 are not necessarily indicative of the results to be expected for the full year ending January 31, 2006. One of the reasons for this is that, generally, sales of the Company’s piping systems have had a tendency to be lower during the winter months, due to weather constraints over much of the country.
MFRI, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In thousands except per share information)
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Three Months Ended
April 30, |
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2005 |
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2004 |
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Net sales |
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$ |
36,202 |
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$ |
32,128 |
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Cost of sales |
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28,225 |
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26,222 |
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Gross profit |
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7,977 |
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5,906 |
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Operating expenses: |
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Selling expense |
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2,849 |
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2,612 |
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General and administrative expense |
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4,414 |
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3,457 |
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Total operating expenses |
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7,263 |
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6,069 |
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Income (loss) from operations |
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714 |
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(163 |
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Income from joint venture |
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96 |
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23 |
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Interest expense - net |
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386 |
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420 |
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Income (loss) before income taxes |
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424 |
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(560 |
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Income taxes (benefit) |
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130 |
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(231 |
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Net income (loss) |
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$ |
294 |
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$ |
(329 |
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Weighted average number of common shares outstanding - basic |
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5,234 |
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4,922 |
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Weighted average number of common shares outstanding - Diluted |
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4,922 |
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Basic earnings per share |
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Net income (loss) |
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$ |
0.06 |
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$ |
(0.07 |
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Diluted earnings per share |
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Net income (loss) |
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$ |
0.05 |
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$ |
(0.07 |
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See notes to condensed consolidated financial statements.
1
MFRI, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
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(In thousands) |
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April 30, |
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January 31, |
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Assets |
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2005 |
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2005 |
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Current Assets: |
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Cash and cash equivalents |
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$ |
417 |
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$ |
723 |
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Restricted cash |
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483 |
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973 |
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Trade accounts receivable, net |
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22,570 |
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22,715 |
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Accounts receivable – related companies |
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900 |
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887 |
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Costs and estimated earnings in excess of |
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billings on uncompleted contracts |
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2,058 |
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2,472 |
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Income taxes receivable |
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— |
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48 |
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Inventories |
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22,024 |
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21,050 |
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Deferred income taxes |
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1,941 |
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1,842 |
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Prepaid expenses and other current assets |
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694 |
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915 |
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Total current assets |
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51,087 |
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51,625 |
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Property, plant and equipment, net |
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26,057 |
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25,800 |
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Other Assets: |
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Patents, net of accumulated amortization |
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533 |
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582 |
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Goodwill |
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2,596 |
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2,616 |
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Other assets |
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4,779 |
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4,893 |
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Total other assets |
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7,908 |
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8,091 |
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Total Assets |
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$ |
85,052 |
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$ |
85,516 |
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</ |