Back to GetFilings.com



Table of Contents
 
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 
For the nine months ended July 31, 2002
 
Commission File No. 0-14880
 
 
MICROLOG CORPORATION
(Exact name of Registrant as specified in its charter)
 
Virginia
  
52-0901291
(State or other jurisdiction of
  
(I.R.S. Employer
Incorporation or organization)
  
Identification No.)
     
20270 Goldenrod Lane
  
20876-4070
Germantown, Maryland
  
(Zip Code)
(Address of principal executive offices)
    
 
(301) 540-5500
(Registrant’s telephone number, including area code)
 
 
Securities registered pursuant to Section 12(b) of the Act:
 
None
 
Securities registered pursuant to Section 12(g) of the Act:
 
Common Stock, par value $.01 per share
(Title of class)
 
 
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    ¨             
 
The aggregate market value of shares of Common Stock held by non-affiliates (based on the last reported sale price of the Common Stock on September 6, 2002, as reported by the Over the Counter Bulletin Board) was approximately $500,000 dollars. The Common Stock is traded over-the-counter. As of September 6, 2002, 7,106,938 shares of the Registrant’s Common Stock were outstanding of which 2,666,667 shares were held by affiliates.
 

Table of Contents
 
TABLE OF CONTENTS
 
         
Page
PART I.
          
Item 1.
   
Financial Results
     
       
1
       
2
       
3
       
4
Item 2.
      
5-9
PART II.— OTHER INFORMATION
  
10
Item 1.
   
Exhibits and Reports on Form 8-K
     
       
10
Item 2.
     
10

Table of Contents
 
PART I
 
Item 1.    Financial Results
 
MICROLOG CORPORATION
 
CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share data)
 
 
               
    
July 31, 2002
     
October 31, 2001
  
    
(Unaudited)
         
ASSETS
                  
Current assets
                  
Cash and cash equivalents
   
$
244
 
   
$
170
 
Receivables, net
   
 
808
 
   
 
291
 
Inventories, net
   
 
117
 
   
 
173
 
Other current assets
   
 
80
 
   
 
107
 
    
  
Total current assets
   
 
1,249
 
   
 
741
 
Fixed assets, net
   
 
448
 
   
 
723
 
Other assets
   
 
104
 
   
 
135
 
    
  
Total assets
   
 
1,801
 
   
 
1,599
 
    
  
LIABILITIES AND STOCKHOLDERS’ DEFICIT
                  
Current liabilities:
                  
Accounts payable
   
 
387
 
   
 
582
 
Accrued compensation and related expenses
   
 
356
 
   
 
471
 
Deferred revenue
   
 
405
 
   
 
334
 
Deferred officers’ compensation—Current portion
   
 
30
 
   
 
30
 
Other accrued expenses
   
 
246
 
   
 
296
 
    
  
Total current liabilities
   
 
1,424
 
   
 
1,713
 
Notes payable—net of discount
   
 
652
 
   
 
351
 
Deferred officers’ compensation
   
 
101
 
   
 
95
 
Other liabilities
   
 
9
 
   
 
41
 
    
  
Total liabilities
   
 
2,186
 
   
 
2,200
 
    
  
Stockholders’ Deficit:
                  
Series A convertible preferred stock, $.01 par value, 100 shares authorized, no shares issued and outstanding
   
 
—  
 
   
 
—  
 
Serial preferred stock, $.01 par value, 1,000,000 shares authorized, no shares issued and outstanding
   
 
—  
 
   
 
—  
 
Common stock, $.01 par value, 20,000,000 and 13,000,000 shares authorized, 7,708,808 and 7,668,808 shares issued, 7,106,938 and 7,106,938 outstanding
   
 
77
 
   
 
77
 
Capital in excess of par value
   
 
20,964
 
   
 
20,761
 
Treasury stock, at cost, 601,870 shares
   
 
(1,177
)
   
 
(1,177
)
Accumulated deficit
   
 
(20,249
)
   
 
(20,262
)
    
  
Total stockholders’ deficit
   
 
(385
)
   
 
(601
)
    
  
Total liabilities and stockholders’ deficit
   
$
1,801
 
   
$
1,599
 
    
  
                   
See accompanying notes to consolidated financial statements

1

Table of Contents
 
MICROLOG CORPORATION
 
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands)
 
    
For The Three Months
     
For The Nine Months
  
    
Ended July 31,
     
Ended July 31,
  
    
2002
     
2001
     
2002
     
2001
  
Sales
   
$
1,494
 
   
$
1,611
 
   
$
4,517
 
   
$
5,850
 
Costs and expenses:
                                    
Cost of sales
   
 
653
 
   
 
1,140
 
   
 
1,962
 
   
 
3,859
 
Selling, general and administrative
   
 
531
 
   
 
930
 
   
 
1,697
 
   
 
3,288
 
Research and development
   
 
218
 
   
 
370
 
   
 
591
 
   
 
1,137
 
    
  
  
  
    
 
1,402
 
   
 
2,440
 
   
 
4,250
 
   
 
8,284
 
    
  
  
  
Operating (loss) income
   
 
92
 
   
 
(829
)
   
 
267
 
   
 
(2,434
)
Interest Expense
   
 
(94
)
   
 
(4
)
   
 
(281
)
   
 
(15
)
Other (expense) income
   
 
4
 
   
 
(12
)
   
 
27
 
   
 
29
 
    
  
  
  
(Loss) income before income taxes
   
 
2
 
   
 
(845
)
   
 
13
 
   
 
(2,420
)
Benefit for income taxes
   
 
0
 
   
 
0
 
   
 
0
 
   
 
0
 
    
  
  
  
Net (loss) income
   
 
2
 
   
 
(845
)
   
 
13
 
   
 
(2,420
)
Basic weighted average shares outstanding
   
 
7,107
 
   
 
7,067
 
   
 
7,107
 
   
 
7,067
 
    
  
  
  
Diluted weighted average shares outstanding
   
 
7,107
 
   
 
7,067
 
   
 
7,107
 
   
 
7,067
 
    
  
  
  
Basic (loss) income per share
   
$
0.00
 
   
$
(0.12
)
   
$
0.00
 
   
$
(0.34
)
Diluted (loss) income per share
   
$
0.00
 
   
$
(0.12
)
   
$
0.00
 
   
$
(0.34
)
                                     
See accompanying notes to consolidated financial statements.
         

2

Table of Contents
 
MICROLOG CORPORATION
 
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
 
      
For The
Nine Months Ended
July 31, 2002
     
For The
Nine Months Ended
July 31, 2001
  
Cash flows from operating activities:
                    
Net income (loss)
     
$
13
 
   
$
(2,420
)
Adjustments to reconcile net income (loss) to net cash
                    
Used in operating activities:
                    
Depreciation
     
 
284
 
   
 
282
 
Amortization of debt discount
     
 
65
 
   
 
0
 
Accretion of beneficial conversion feature
     
 
141
 
   
 
0
 
Provision for bad debts expense
     
 
0
 
   
 
413
 
Provision for inventory reserves
     
 
(42
)
   
 
50
 
Consulting Expense funded through issuance of common stock
     
 
0
 
   
 
16
 
Changes in assets and liabilities:
                    
Receivables
     
 
(516
)
   
 
794
 
Inventories
     
 
98
 
   
 
(91
)
Other assets
     
 
58
 
   
 
128
 
Accounts payable
     
 
(195
)
   
 
(53
)
Accrued compensation and related expenses
     
 
(162
)
   
 
(430
)
Deferred revenue
     
 
71
 
   
 
(98
)
Other accrued expenses and liabilities
     
 
(37
)
   
 
29
 
Deferred officers’ compensation
     
 
5
 
   
 
(7
)
      
  
Net cash used in operating activities
     
 
(217
)
   
 
(1,387
)
      
  
Cash flows from investing activities:
                    
Purchases of fixed assets
     
 
(9
)
   
 
(319
)
      
  
Net cash used in investing activities
     
 
(9
)
   
 
(319
)
      
  
Cash flows from financing activities:
                    
Proceeds from issuance of long-term debt and warrants
     
 
300
 
   
 
200
 
      
  
Net cash provided by financing activities
     
 
300
 
   
 
200
 
      
  
Cash and cash equivalents:
                    
Net increase (decrease) during period
     
 
74
 
   
 
(1,506
)
Balance at beginning of period
     
 
170