FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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(Mark One) |
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ý QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE |
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For the quarterly period ended March 31, 2003 |
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OR |
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o TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE |
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For the transition period from to |
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Commission file number 0-11625 |
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MFIC CORPORATION |
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(Exact name of registrant as specified in its charter) |
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Delaware |
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04-2793022 |
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(State or Other
Jurisdiction |
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(I.R.S. Employer |
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30 Ossipee Road, P.O.Box 9101, Newton, Massachusetts 02464 |
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(Address of Principal Executive Offices) (Zip Code) |
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(617)969-5452 |
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(Registrant’s Telephone Number, Including Area Code) |
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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 ý No o
Registrant had 7,720,987 shares of Common Stock, par value $.01 per share, outstanding on May 8, 2003.
MFIC CORPORATION
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INDEX |
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Condensed Consolidated Balance Sheets as of March 31, 2003 (unaudited) and December 31, 2002 |
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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2
MFIC CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
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March 31, |
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December
31, |
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(Unaudited) |
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ASSETS |
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Current Assets: |
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Cash and cash equivalents |
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$ |
98,788 |
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$ |
84,956 |
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Accounts receivable (less allowance for doubtful accounts of $58,233 at March 31,2003 and $45,233 at December 31,2002) |
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2,190,514 |
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2,458,108 |
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Notes Receivable – current |
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16,429 |
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16,429 |
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Inventories |
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4,308,949 |
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3,898,098 |
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Prepaid expense |
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117,554 |
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192,518 |
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Other current assets |
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228,906 |
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166,030 |
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Total current assets |
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6,961,140 |
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6,816,139 |
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Property |
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Furniture, fixtures and office equipment |
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295,512 |
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288,472 |
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Machinery and equipment |
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451,379 |
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397,359 |
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Leasehold improvements |
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145,422 |
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133,522 |
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892,313 |
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819,353 |
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Less: accumulated depreciation and amortization |
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(422,015 |
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(379,680 |
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Net property and equipment |
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470,298 |
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439,673 |
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Notes receivable –long term |
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67,083 |
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71,190 |
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Goodwill (net of accumulated amortization and impairment charges of $4,064,459 at both March 31, 2003 and December 31, 2002.) |
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2,100,000 |
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2,100,000 |
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Patents, licenses and other intangible assets (net of accumulated amortization of $300,935 at March 31,2003 and $299,985 at December 31, 2002) |
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58,828 |
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59,778 |
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Total assets |
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$ |
9,657,349 |
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$ |
9,486,780 |
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See notes to condensed consolidated financial statements
3
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March 31, |
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December
31, |
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(Unaudited) |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current Liabilities: |
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Line of credit |
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$ |
2,421,642 |
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$ |
2,681,987 |
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Accounts payable and accrued expenses |
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2,009,170 |
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1,899,113 |
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Accrued interest – related party |
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11,230 |
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14,980 |
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Accrued compensation and vacation pay |
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102,679 |
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158,119 |
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Customer advances |
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548,634 |
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320,224 |
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Current portion of note payable |
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95,004 |
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95,004 |
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Current portion of long term debt-related party |
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75,000 |
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75,000 |
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Total current liabilities |
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5,263,359 |
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5,244,427 |
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Long term debt, net of current portion-related party |
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62,500 |
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81,250 |
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Term note, net of current portion |
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34,984 |
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58,735 |
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Stockholders’
equity: |
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77,210 |
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77,051 |
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Additional paid-in-capital |
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12,949,827 |
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12,945,520 |
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Accumulated deficit |
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(8,042,830 |
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(8,232,502 |
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Less: Treasury stock, at cost, 260,446 shares at both March 31, 2003 and December 31, 2002, respectively |
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(687,701 |
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(687,701 |
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Total stockholders’ equity |
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4,296,506 |
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4,102,368 |
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Total liabilities and stockholders’ equity |
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$ |
9,657,349 |
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$ |
9,486,780 |
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See notes to condensed consolidated financial statements
4
MFIC CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
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Three
months ended |
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(Unaudited) |
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2003 |
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2002 |
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Revenues |
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$ |
3,787,183 |
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$ |
3,581,320 |
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Cost of goods sold |
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2,092,322 |
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1,910,375 |
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Gross profit |
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1,694,861 |
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1,670,945 |
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Operating expenses: |
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Research and development |
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210,596 |
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259,802 |
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Selling |
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715,121 |
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732,126 |
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General and administrative |
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549,998 |
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533,173 |
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Total operating expenses |
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1,475,715 |
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1,525,101 |
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Income from operations |
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219,146 |
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145,844 |
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Interest income |
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2,089 |
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1,797 |
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Interest expense |
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31,563 |
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47,394 |
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Net income before cumulative effect of accounting change |
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189,672 |
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100,247 |
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Cumulative effect of accounting change |
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— |
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(2,661,409 |
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Net income (loss) after cumulative effect of accounting change |
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189,672 |
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$ |
(2,561,162 |
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Weighted average number of common and common equivalent shares outstanding: |
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Basic |
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7,455,233 |
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7,389,368 |
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Diluted |
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7,530,529 |
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7,389,368 |
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Net income per share prior to cumulative effect of accounting change: |
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Basic |
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$ |
0.03 |
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