UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549-1004
Form 10-Q
(Mark One)
ý Quarterly report pursuant to Section 13 or 15(d)
of the Securities Exchange
Act of 1934
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2004
or
o 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 0-21681
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EFJ, INC. |
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(Exact name of registrant as specified in its charter) |
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DELAWARE |
47-0801192 |
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(State or other
jurisdiction of |
(I.R.S. Employer Identification No.) |
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1232 22nd STREET NW, SUITE 600 |
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(Address, including zip
code, and telephone number, |
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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 check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
YES o NO ý
As of October 18, 2004, 18,066,962 shares of the Registrant’s Common Stock were outstanding.
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
September 30, 2004 and December 31, 2003
(in thousands, except share data)
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SEPTEMBER 30, |
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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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$ |
7,967 |
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$ |
4,644 |
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Accounts receivable, net of allowance for returns and doubtful accounts of $142 and $104, respectively |
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9,863 |
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19,754 |
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Receivables – other |
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178 |
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157 |
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Cost in excess of billings on uncompleted contracts |
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1,371 |
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869 |
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Inventories |
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14,531 |
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18,040 |
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Deferred income taxes |
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2,000 |
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1,500 |
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Prepaid expenses |
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3,262 |
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587 |
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Total current assets |
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39,172 |
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45,551 |
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Property, plant and equipment, net |
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3,546 |
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2,779 |
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Deferred income taxes |
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6,000 |
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6,500 |
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Intangible assets, net of accumulated amortization |
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6,748 |
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6,753 |
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Other assets |
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542 |
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686 |
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TOTAL ASSETS |
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$ |
56,008 |
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$ |
62,269 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current liabilities: |
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Revolving line of credit |
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$ |
— |
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$ |
7,500 |
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Current portion of long-term debt obligations |
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131 |
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127 |
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Accounts payable |
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6,719 |
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8,582 |
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Billings in excess of cost on uncompleted contracts |
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25 |
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30 |
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Deferred revenue – current |
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277 |
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1,191 |
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Accrued expenses |
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3,867 |
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3,406 |
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Total current liabilities |
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11,019 |
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20,836 |
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Long-term debt obligations, net of current portion |
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323 |
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426 |
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Deferred revenue, net of current portion |
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737 |
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601 |
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TOTAL LIABILITIES |
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12,079 |
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21,863 |
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Stockholders’ equity: |
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Preferred stock ($0.01 par value; 3,000,000 shares authorized; none issued) |
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— |
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— |
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Common stock ($0.01 par value; 50,000,000 voting shares authorized, 17,972,432 and 17,359,973 issued and outstanding as of September 30, 2004 and December 31, 2003; 600,000 non-voting shares authorized, 217,542 issued and outstanding at December 31, 2003, which shares were converted to voting shares in 2004) |
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180 |
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176 |
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Additional paid-in capital |
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102,046 |
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100,845 |
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Accumulated deficit |
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(58,297 |
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(60,615 |
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TOTAL STOCKHOLDERS’ EQUITY |
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43,929 |
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40,406 |
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
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$ |
56,008 |
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$ |
62,269 |
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See accompanying notes to the condensed consolidated financial statements.
2
EFJ, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For
the three and nine months ended September 30, 2004 and 2003
(Unaudited and in thousands, except share and per share data)
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THREE MONTHS ENDED |
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NINE MONTHS ENDED |
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2004 |
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2003 |
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2004 |
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2003 |
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Revenues |
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$ |
15,430 |
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$ |
13,089 |
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$ |
55,245 |
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$ |
32,803 |
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Cost of sales |
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8,161 |
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7,853 |
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30,401 |
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18,974 |
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Gross profit |
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7,269 |
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5,236 |
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24,844 |
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13,829 |
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Operating expenses: |
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Research and development |
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2,572 |
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1,939 |
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7,842 |
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5,154 |
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Sales and marketing |
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2,709 |
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1,756 |
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7,045 |
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4,590 |
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General and administrative, inclusive of non-cash stock option repricing (benefit) expense adjustment of $(1,425) and $886 for the three and nine months ended September 30, 2004 and $1,890 and $2,186 for the same periods ended September 30, 2003 |
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1,221 |
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3,327 |
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7,580 |
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6,523 |
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Total operating expenses |
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6,502 |
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7,022 |
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22,467 |
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16,267 |
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Income (loss) from operations |
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767 |
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(1,786 |
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2,377 |
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(2,438 |
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Other income (expense) |
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34 |
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35 |
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29 |
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62 |
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Interest income |
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11 |
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5 |
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31 |
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26 |
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Interest expense |
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(28 |
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(41 |
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(119 |
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(133 |
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Income (loss) before income taxes |
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784 |
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