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Form 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 28, 2002

OR

[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transaction period from _________ to __________

Commission file number 0-9321

PRINTRONIX, INC.
(Exact name of registrant as specified in its charter)

Delaware
(state or other jurisdiction of
incorporation or organization) 		95-2903992
(I.R.S. Employer
Identification No.)

14600 Myford Road
Irvine, California
(Address of principal executive offices) 		92606
(Zip Code)

(714) 368-2300
(Registrant’s telephone number, including area code)

Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

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, and (2) has been subject to such filing requirements for the past 90 days.

YES [X]          NO [_]

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.


Class of Common Stock
$0.01 par value		 Outstanding at July 26, 2002
5,905,309


PRINTRONIX, INC. AND SUBSIDIARIES
TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION Page

Item 1. Financial Statements  

  Consolidated Balance Sheets at June 28, 2002 and March 29, 2002  

  Assets 3

  Liabilities and Stockholders’ Equity 4

  Consolidated Statements of Operations for the Three Months Ended June 28, 2002 and June 29, 2001 5

  Consolidated Statements of Comprehensive Income for the Three Months Ended June 28, 2002 and June 29, 2001 6

  Consolidated Statements of Cash Flows for the Three Months Ended June 28, 2002 and June 29, 2001 7

  Condensed Notes to Consolidated Financial Statements 8

Item 2.
 		 Management’s Discussion and Analysis of Financial Condition and Results of Operations 14

Item 3. Market Risk 18

Part II. OTHER INFORMATION  

Item 1. Legal Proceedings 19

Item 6. Exhibits and Reports on Form 8-K 19

Signatures   20

2


PART I. FINANCIAL INFORMATION
Item 1. Financial Statements

PRINTRONIX, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
(Unaudited)

June 28, 2002
  March 29, 2002
 
ASSETS:            
Current assets:    
    Cash and cash equivalents     $ 23,390   $ 22,618  
    Accounts receivable, net of allowance for doubtful accounts of    
        $2,709 and $2,524 as of June 28, 2002 and March 29, 2002,    
        respectively       20,889     18,232  
 
    Inventories:    
        Raw materials, subassemblies and work in process       10,792     12,443  
        Finished goods       2,775     2,620  
 
 
 
          Total inventory       13,567     15,063  
 
    Prepaid expenses and other current assets       1,960     1,346  
    Deferred income tax assets       4,010     4,010  
 
 
 
Total current assets       63,816     61,269  
 
 
 
Property, plant and equipment, at cost:    
    Machinery and equipment       28,682     29,154  
    Furniture and fixtures       27,671     27,513  
    Buildings and improvements       22,826     22,819  
    Land       8,100     8,100  
    Leasehold improvements       928     792  
 
 
 
        88,207     88,378  
                 
    Less: Accumulated depreciation and amortization       (46,579 )   (45,481 )
 
 
 
          Property, plant and equipment, net       41,628     42,897  
 
Intangible assets, net of accumulated amortization of $786 and    
    $1,220 as of June 28, 2002 and March 29, 2002, respectively       104     148  
 
Long-term deferred income tax assets       488     488  
Other assets       157     157  
 
 
 
 
Total assets     $ 106,193   $ 104,959  
 
 
 

The accompanying notes are an integral part of these consolidated financial statements.

3


PRINTRONIX, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS  continued
(Amounts in thousands, except share and per share data)
(Unaudited)

June 28, 2002
   March 29, 2002
  
LIABILITIES AND STOCKHOLDERS’ EQUITY:            
Current liabilities:    
    Short-term debt     $ 700   $ 700  
    Accounts payable       7,320     7,546  
    Accrued liabilities:    
         Payroll and employee benefits       4,383     4,840  
         Warranty       1,304     1,304  
         Deferred revenue       1,377     1,449  
         Other       5,415     4,764  
         Income taxes       548     180  
 
 
 
Total current liabilities       21,047     20,783  
 
 
 
 
Long-term debt, net of current portion       15,400     15,575  
Deferred revenue, net of current portion       24     35  
Other non-current liabilities       —     24  
 
Commitments and contingencies (See Note 7)    
 
Stockholders’ equity:    
    Common stock, $0.01 par value    
         (Authorized 30,000,000 shares, issued and    
         outstanding 5,882,878 and 5,849,864 shares as of    
         June 28, 2002 and March 29, 2002, respectively)       59     58  
    Additional paid-in capital       29,077     28,815  
    Retained earnings       40,666     39,669  
    Accumulated other comprehensive income       (80 )   —  
 
 
 
Total stockholders’ equity       69,722     68,542  
 
 
 
 
Total liabilities and stockholders’ equity     $ 106,193   $ 104,959  
 
 
 

The accompanying notes are an integral part of these consolidated financial statements.

4


PRINTRONIX, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except share and per share data)
(Unaudited)

  Three Months Ended
  
  June 28, 2002
   June 29, 2001
  
 
Net sales     $ 37,303   $ 39,607  
Cost of sales       24,303     27,558  
 
 
 
Gross margin       13,000     12,049  
 
Operating expenses:    
      Engineering and development       4,061     3,947  
      Sales and marketing       5,577     4,765  
      General and administrative       2,386     2,220  
 
 
 
Total operating expenses       12,024     10,932  
 
 
 
 
Income from operations       976     1,117  
 
Other (income) expense, net       (267 )   467  
 
 
 
 
Income before provision for income taxes       1,243     650  
 
Provision for income taxes       249     131  
 
 
 
 
Net income     $ 994   $ 519  
 
 
 
Net income per common share:    
      Basic     $ 0.17   $ 0.09  
      Diluted     $ 0.16   $ 0.09  
 
Weighted average common shares:    
      Basic       5,866,743     5,846,839  
      Diluted       6,218,710     5,866,666  

The accompanying notes are an integral part of these consolidated financial statements.

5


PRINTRONIX, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Amounts in thousands)
(Unaudited)

  Three Months Ended
  
  June 28, 2002
   June 29, 2001
  
 
Net income     $ 994   $ 519  
 
Other comprehensive (income) expense, net of tax       80     —  
 
 
 
Comprehensive income     $ 914   $ 519  
 
 
 

The accompanying notes are an integral part of these consolidated financial statements.

6


PRINTRONIX, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands)
(Unaudited)

  Three Months Ended
 
  June 28, 2002
  June 29, 2001
 
 
Cash flows from operating activities:            
    Net income     $ 994   $ 519  
 
    Adjustments to reconcile net income to net cash provided by    
    operating activities:    
         Depreciation and amortization       1,915     2,148  
         Provision for doubtful accounts receivable       185     103  
         Deferred income tax provision (benefit)       —     (19 )
         Loss on disposal of property and equipment       77     322  
         Changes in assets and liabilities:    
              Accounts receivable       (2,842 )   (759 )
              Inventories       1,496     2,974  
              Other assets       (614 )   (249 )
              Accounts payable       (226 )   654  
              Payroll and employee benefits       (457 )   67  
              Accrued income taxes       368     (58 )
              Deferred revenue       (83 )   (4 )
              Other liabilities       550     15  
 
 
 
 
Net cash provided by operating activities       1,363     5,713  
 
 
 
Cash flows from investing activities:    
    Purchase of property, plant and equipment       (740 )   (1,399 )
    Proceeds from disposition of property, plant and equipment       61     13  
 
 
 
 
Net cash used in investing activities       (679 )   (1,386 )
     
Cash flows from financing activities:    
    Payments made on long-term note       (175 )   (175 )
    Payments made on line of credit       —     (3,500 )
    Proceeds from the exercise of stock options       263     —  
 
 
 
 
Net cash provided by (used in) financing activities       88     (3,675 )
 
 
 
 
Net increase in cash and cash equivalents       772     652  
 
Cash and cash equivalents at beginning of period       22,618     9,832  
 
 
 
 
Cash and cash equivalents at end of period     $ 23,390   $ 10,484  
 
 
 
 
Supplementary disclosures of cash flow information:    
    Income tax paid     $ 170   $ 213  
    Interest paid     $ 132   $ 382  

The accompanying notes are an integral part of these consolidated financial statements.

7


PRINTRONIX, INC. AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 28, 2002
(Unaudited)

1) Basis of Presentation

  The unaudited, consolidated financial statements included herein have been prepared by Printronix, Inc., pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. However, we believe that the disclosures are adequate to make the information presented not misleading.

  In the opinion of management, the consolidated financial statements reflect all adjustments (which include only normal recurring adjustments) considered necessary to present fairly the financial position and results of operations as of and for the periods presented. These consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto included in our latest Annual Report on Form 10-K for the fiscal year ended March 29, 2002, as filed with the Securities and Exchange Commission. The results of operations for such interim periods are not necessarily indicative of the results for the full year.

  Unless the context otherwise requires, the terms “we,” “our,” “us,” “Company” and “Printronix” refer to Printronix, Inc. and its consolidated subsidiaries.

2) Bank Borrowings and Debt Arrangements

  On May 1, 2000, we entered into a $17.5 million, seven-year note secured by our Irvine facility and a $10.0 million three-year unsecured line of credit. During the first quarter of fiscal 2002, we repaid the line of credit borrowings as scheduled and cancelled the $10.0 million unsecured line of credit. Interest on the seven-year note is at variable rates based on London Interbank Offered Rate (“LIBOR”) plus 1.25%, and is reset for periods not exceeding one year at our discretion. The interest rate on the note was 3.125% at June 28, 2002. During the current quarter, the weighted average interest rate on the note was 3.2%. Total interest expense was $0.1 million for the current quarter compared with $0.4 million for the same quarter last year. We ended the current quarter with a balance of $16.1 million on the note, which consists of $15.4 million long-term debt and $0.7 short-term debt.

  At June 28, 2002, one of our foreign subsidiaries maintained unsecured lines of credit for $2.5 m