SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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(Mark One) |
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ý 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 March 31, 2003 |
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OR |
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o 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 to |
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Commission file number 1-12676 |
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COASTCAST CORPORATION |
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(Exact name of registrant as specified in its charter) |
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CALIFORNIA |
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95-3454926 |
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(State or other jurisdiction of |
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(I.R.S. Employer |
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3025 EAST VICTORIA STREET, RANCHO DOMINGUEZ, CA 90221 |
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(Address of principal executive offices) (Zip Code) |
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Registrant’s telephone number, including area code (310)638-0595 |
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Not Applicable |
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(Former name, former address and former fiscal year,
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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
Indicate by checkmark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes o No ý
At May 13, 2003 there were outstanding 7,635,042 shares of common stock, no par value.
COASTCAST CORPORATION
INDEX
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PART I. |
FINANCIAL INFORMATION: |
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Item 1. |
Financial Statements |
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Condensed Consolidated Balance Sheets as of March 31, 2003 (Unaudited) and December 31, 2002 |
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Notes to Condensed Consolidated Financial Statements (Unaudited) |
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Forward Looking Statements
This document includes certain “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from these expectations due to changes in political, economic, business, competitive, market and regulatory factors.
2
COASTCAST CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
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(Unaudited) |
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March 31, |
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December
31, |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ |
12,410,000 |
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$ |
15,727,000 |
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Trade accounts receivable, net of allowance for doubtful Accounts of $125,000 at March 31, 2003 and at December 31, 2002 |
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5,276,000 |
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3,805,000 |
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Inventories (Note 2) |
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5,742,000 |
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5,193,000 |
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Prepaid expenses and other current assets |
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4,065,000 |
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4,144,000 |
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Assets held for sale (Note 3) |
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5,093,000 |
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5,178,000 |
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Total current assets |
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32,586,000 |
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34,047,000 |
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Property, plant and equipment, net |
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8,600,000 |
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9,216,000 |
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Other assets |
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1,256,000 |
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1,255,000 |
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$ |
42,442,000 |
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$ |
44,518,000 |
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LIABILITIES AND SHAREHOLDERS’ EQUITY |
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Current liabilities: |
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Accounts payable |
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$ |
2,598,000 |
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$ |
2,081,000 |
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Accrued liabilities |
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3,399,000 |
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3,311,000 |
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Total current liabilities |
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5,997,000 |
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5,392,000 |
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Long term liabilities |
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1,831,000 |
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1,817,000 |
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Total liabilities |
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7,828,000 |
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7,209,000 |
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Commitments and contingencies |
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Shareholders’ Equity: |
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Preferred
stock, no par value, 2,000,000 shares authorized; |
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Common
stock, no par value, 20,000,000 shares authorized; |
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26,068,000 |
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26,068,000 |
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Retained earnings |
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9,139,000 |
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11,875,000 |
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Accumulated other comprehensive loss |
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(593,000 |
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(634,000 |
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Total shareholders’ equity |
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34,614,000 |
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37,309,000 |
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$ |
42,442,000 |
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$ |
44,518,000 |
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See accompanying notes to condensed consolidated financial statements.
3
COASTCAST CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
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For the
Three Months |
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2003 |
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2002 |
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Sales |
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$ |
10,731,000 |
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$ |
21,956,000 |
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Cost of sales |
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12,049,000 |
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19,064,000 |
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Gross (loss) profit |
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(1,318,000 |
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2,892,000 |
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Selling, general and administrative expenses |
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1,250,000 |
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1,603,000 |
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Impairment of fixed assets |
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55,000 |
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— |
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(Loss) income from operations |
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(2,623,000 |
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1,289,000 |
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Other income, net |
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17,000 |
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34,000 |
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(Loss) income before income taxes |
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(2,606,000 |
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1,323,000 |
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Provision for income taxes |
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130,000 |
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600,000 |
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Net (loss) income |
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$ |
(2,736,000 |
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$ |
723,000 |
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NET (LOSS) INCOME PER SHARE (Note 5) |
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Net (loss) income per share – basic |
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$ |
(0.36 |
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0.09 |
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Weighted average shares outstanding |
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7,635,042 |
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7,635,042 |
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Net (loss) income per share – diluted |
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$ |
(0.36 |
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0.09 |
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Weighted average shares outstanding – diluted |
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7,635,042 |
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7,636,792 |
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See accompanying notes to condensed consolidated financial statements.
4
COASTCAST CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
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For the Three Months |
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2003 |
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2002 |
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CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net (loss) income |
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$ |
(2,736,000 |
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$ |
723,000 |
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Adjustments to reconcile net (loss) income to net cash used in operating activities: |
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Depreciation and amortization |
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677,000 |
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1,022,000 |
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Loss on disposal of machinery and equipment |
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3,000 |
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Loss on disposal of assets held for sale |
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55,000 |
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Deferred compensation |
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14,000 |
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75,000 |
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Pension liability |
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(99,000 |
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Deferred income taxes |
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— |
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