Back to GetFilings.com



Table of Contents

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 10-Q

 

 

x   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended January 31, 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 0-12448

 

 

FLOW INTERNATIONAL CORPORATION

 

 

WASHINGTON

     

91-1104842

    
    

(State or other jurisdiction

of incorporation or organization)

     

(I.R.S. Employer

Identification No.)

 

23500 - - 64th Avenue South

Kent, Washington 98032

(253) 850-3500

 

 

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 Rule 12b-2 of the Exchange Act).     Yes  ¨    No  x.

 

The number of shares outstanding of common stock, as of March 24, 2003 is 15,358,759 shares.

 

Table of Contents

 

FLOW INTERNATIONAL CORPORATION

 

INDEX

 

         

Page

Part I—FINANCIAL INFORMATION

     

Item 1.

   

Consolidated Financial Statements

     
    

Consolidated Balance Sheets—
January 31, 2003 and April 30, 2002.

  

3

    

Consolidated Statements of Operations—
Three Months Ended January 31, 2003 and 2002

  

4

    

Consolidated Statements of Operations—
Nine Months Ended January 31, 2003 and 2002   

  

5

    

Condensed Consolidated Statements of Cash Flows—
Nine Months Ended January 31, 2003 and 2002   

  

6

    

Consolidated Statements of Comprehensive Operations—
Three Months and Nine Months Ended January 31, 2003 and 2002

  

7

    

Notes to Condensed Consolidated Financial Statements

  

8

Item 2.

   

Management’s Discussion and Analysis of
Financial Condition and Results of Operations.

  

19

Item 3.

   

Quantitative and Qualitative Disclosures About Market Risk

  

35

Item 4.

   

Controls and Procedures

  

36

Part II—OTHER INFORMATION

    

Item 1.

   

Legal Proceedings

  

37

Item 2.

   

Changes in Securities and Use of Proceeds

  

37

Item 3.

   

Defaults Upon Senior Securities

  

37

Item 4.

   

Submission of Matters to a Vote
of Security Holders

  

37

Item 5.

   

Other Information

  

37

Item 6.

   

Exhibits and Reports on Form 8-K

  

37

Signatures

  

39

Certifications

  

40

Table of Contents

FLOW INTERNATIONAL CORPORATION

CONSOLIDATED BALANCE SHEETS

(unaudited; in thousands, except share amounts)

 

    

January 31, 2003

     

April 30, 2002

  

ASSETS

                  

Current Assets:

                  

Cash and Cash Equivalents

   

$

6,599

 

   

$

7,120

 

Receivables, Net

   

 

44,092

 

   

 

62,774

 

Inventories

   

 

45,096

 

   

 

48,164

 

Deferred Income Taxes

   

 

—  

 

   

 

1,980

 

Other Current Assets

   

 

15,235

 

   

 

11,608

 

    
  

Total Current Assets

   

 

111,022

 

   

 

131,646

 

Equipment Held for Lease, Net

   

 

2,368

 

   

 

5,968

 

Property and Equipment, Net

   

 

15,238

 

   

 

16,996

 

Patents and Other Intangible Assets, Net of Accumulated Amortization of $9,715 and $8,735, respectively

   

 

12,622

 

   

 

13,182

 

Goodwill

   

 

10,205

 

   

 

16,332

 

Deferred Income Taxes

   

 

—  

 

   

 

5,115

 

Other Assets

   

 

10,349

 

   

 

17,237

 

    
  
    

$

161,804

 

   

$

206,476

 

    
  

LIABILITIES, MINORITY INTEREST AND STOCKHOLDERS’ EQUITY

                  

Current Liabilities:

                  

Notes Payable

   

$

5,253

 

   

$

374

 

Current Portion of Long-Term Obligations

   

 

90,276

 

   

 

6,114

 

Accounts Payable

   

 

8,406

 

   

 

11,617

 

Accrued Payroll and Related Liabilities

   

 

4,636

 

   

 

4,844

 

Other Accrued Taxes

   

 

1,711

 

   

 

2,530

 

Deferred Revenue

   

 

5,285

 

   

 

3,613

 

Other Accrued Liabilities

   

 

15,502

 

   

 

14,920

 

    
  

Total Current Liabilities

   

 

131,069

 

   

 

44,012

 

Long-Term Obligations

   

 

—  

 

   

 

81,625

 

Customer Deposits

   

 

5,811

 

   

 

7,909

 

    
  

Total Liabilities

   

 

136,880

 

   

 

133,546

 

    
  

Minority Interest

   

 

2,337

 

   

 

2,246

 

    
  

Stockholders’ Equity:

                  

Series A 8% Convertible Preferred Stock—$.01 par value, 1,000,000 shares authorized, none issued

   

 

—  

 

   

 

—  

 

Common Stock—$.01 par value, 20,000,000 shares authorized, 15,358,759 shares outstanding at January 31, 2003, 15,281,759 shares outstanding at April 30, 2002

   

 

154

 

   

 

153

 

Capital in Excess of Par

   

 

55,711

 

   

 

55,158

 

Retained Earnings (Accumulated Deficit)

   

 

(25,251

)

   

 

29,206

 

Accumulated Other Comprehensive Loss

   

 

(8,027

)

   

 

(13,833

)

    
  

Total Stockholders’ Equity

   

 

22,587

 

   

 

70,684

 

    
  
    

$

161,804

 

   

$

206,476

 

    
  

 

See Accompanying Notes to

Condensed Consolidated Financial Statements

 

3

Table of Contents

FLOW INTERNATIONAL CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited; in thousands, except per share data)

 

    

Three Months Ended January 31,

  
    

2003

     

2002

  

Revenues

   

$

30,865

 

   

$

41,483

 

Cost of Sales

   

 

31,635

 

   

 

24,259

 

    
  

Gross Margin

   

 

(770

)

   

 

17,224

 

Expenses:

                  

Marketing

   

 

10,853

 

   

 

8,036

 

Research and Engineering

   

 

3,696

 

   

 

3,538

 

General and Administrative

   

 

7,411

 

   

 

4,072

 

Goodwill Impairment

   

 

7,145

 

   

 

—  

 

    
  
    

 

29,105

 

   

 

15,646

 

    
  

Operating (Loss) Income

   

 

(29,875

)

   

 

1,578

 

Interest Expense, Net

   

 

3,198

 

   

 

2,203

 

Other Expense, Net

   

 

3,234

 

   

 

128

 

    
  

Loss Before (Provision) Benefit for Income Taxes

   

 

(36,307

)

   

 

(753

)

(Provision) Benefit for Income Taxes

   

 

(5,312

)

   

 

248

 

    
  

Net Loss

   

$

(41,619

)

   

$

(505

)

    
  

Basic Loss Per Share

   

$

(2.71

)

   

$

(.03

)

    
  

Diluted Loss Per Share

   

$

(2.71

)

   

$

(.03

)

    
  

Weighted Average Shares Used in Computing Basic and Diluted

    Loss Per Share

                  

Basic

   

 

15,359

 

   

 

15,254

 

Diluted

   

 

15,359

 

   

 

15,254

 

 

See Accompanying Notes to

Condensed Consolidated Financial Statements

 

4

Table of Contents

FLOW INTERNATIONAL CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited; in thousands, except per share data)

 

    

Nine Months Ended January 31,

  
    

2003

     

2002

  

Revenues

   

$

113,553

 

   

$

132,323

 

Cost of Sales

   

 

86,552

 

   

 

78,056

 

    
  

Gross Margin

   

 

27,001

 

   

 

54,267

 

Expenses:

                  

Marketing

   

 

27,132

 

   

 

23,280

 

Research and Engineering

   

 

10,324

 

   

 

10,825

 

General and Administrative

   

 

16,772

 

   

 

12,536

 

Goodwill Impairment

   

 

7,145

 

   

 

—  

 

    
  
    

 

61,373

 

   

 

46,641

 

    
  

Operating (Loss) Income

   

 

(34,372

)

   

 

7,626

 

Interest Expense, Net

   

 

8,201

 

   

 

6,761

 

Other Expense, Net

   

 

4,053

 

   

 

430

 

    
  

(Loss) Income Before Provision for Income Taxes

   

 <