10-Q 1 k60618e10-q.txt FORM 10-Q 1 CONFORMED UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter ended January 31, 2001 Commission file number: 0-6056 Michigan Rivet Corporation ------------------------------------------------------ (exact name of registrant as specified in its charter) Michigan 38-1887153 ------------------------ ------------------------------------ (State of Incorporation) (I.R.S. Employer Identification No.) 13201 Stephens Road, Warren, MI 48089 ---------------------------------------- (Address of Principal Executive Offices) Registrant's telephone number, including area code: (810) 754-5100 -------------- 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 XX No ---- ---- There were 641,375 outstanding shares of the registrant's common stock, $1.00 par value, as of January 31, 2001, close of the period covered by this report. 1 2 MICHIGAN RIVET CORPORATION NOTE TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE A - BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the interim periods are not necessarily indicative of the results that may be expected for the year. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's Annual Report on Form 10-K for the year ended October 31, 2000. 2 3 PART I. FINANCIAL INFORMATION FORM 10-Q ITEM 1. FINANCIAL STATEMENTS MICHIGAN RIVET CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

ASSETS ~~July~~January 31, October 31, 2001 2000 ~~1999~~ ------------ ------------- Current Assets: Cash ............................................~~...........................~~ $ ~~269~~35,~~831~~336 $ 9918,~~220~~950 Accounts receivable, less allowance of $50,000 ..~~...........................~~ 54,~~431~~424,~~438~~057 6,~~004~~523,~~636~~119 Inventories .....................................~~...........................~~ 5,~~758~~460,~~484~~509 65,~~841~~730,~~484~~509 Deferred federal income taxes ...................~~...........................~~ ~~855~~760,000 ~~805~~760,000 Prepaid expenses and other current assets .......~~...........................~~ ~~252~~190,~~488~~978 ~~232~~201,~~500~~460 ----------- ----------- TOTAL CURRENT ASSETS ......~~...............~~ 1210,~~567~~870,~~241~~880 13,~~982~~234,~~840~~038 Other Assets ......................................~~...........................~~ 1846,~~012,210~~434 1846,~~012,210~~434 Property, Plant and Equipment .....................~~...........................~~ 30,~~351~~806,~~894~~596 2730,~~839~~573,~~912~~715 Less accumulated depreciation ...................~~...........................~~ 1617,~~943~~626,~~266~~249 1617,~~160~~249,~~458~~749 ----------- ----------- 13,~~408~~180,~~628~~347 1113,~~679~~323,~~454~~966 ----------- ----------- $2624,~~988~~897,~~079~~661 $2627,~~674~~404,~~504~~438 ============ =========== LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Notes payable to bank ...........................~~...........................~~ $ 1615,~~800,~~000 $ ~~216~~585,000 Accounts payable ................................~~...........................~~ 3,~~371~~508,~~793~~983 4,~~568~~569,~~961~~482 Payroll and ~~employee~~employees benefits ..................~~............................~~ ~~504~~550,~~161~~366 1,~~602~~061,~~458~~905 Other accrued expenses ..........................~~...........................~~ ~~667~~12,~~645~~385 ~~750~~341,~~998~~453 Current maturities of long-term debt ............~~...........................~~ ~~321,~~315 ~~321~~,771 315,771 ----------- ----------- TOTAL CURRENT LIABILITIES ~~................ 6~~5,~~664~~002,~~914~~505 76,~~459~~873,~~732~~611 Long-Term Debt ....................................~~...........................~~ 1,~~534~~390,~~415~~733 1,~~720~~466,~~167~~206 Accrued Retiree Health Liability ..................~~...........................~~ 4,~~189~~131,~~827~~294 4,~~068~~071,~~780~~957 Shareholders' Equity Common stock - $1 par value Authorized - 1,000,000 shares Outstanding - 641,375 shares ................~~........................~~ 641,375 ~~638~~641,~~525~~375 Other capital ...................................~~...........................~~ 174,488 ~~117~~174,~~403~~488 Retained earnings ...............................~~...........................~~ 13,~~783~~557,~~060~~266 1214,~~669~~176,~~897~~801 ----------- ----------- 14,~~598~~373,~~923~~129 1314,~~425~~992,~~825~~664 ----------- ----------- $2624,~~988~~897,~~079~~661 $2627,~~674~~404,~~504~~438 =========== ===========

See notes to condensed consolidated financial statements. 3 4 FORM 10-Q MICHIGAN RIVET CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

Three Months Ended ~~Nine~~January ~~Months Ended July~~ 31 ~~July 31~~ --------------------------~~-----~~ ~~--------------------------------~~2001 2000 ~~1999 2000 1999~~ ----------- ---------- --~~---------~~ ~~-----------~~ Net sales .......................~~...............~~ $~~10,218,769~~ ~~$11~~7,~~195~~658,~~010~~295 $3210,~~262~~327,~~599~~184 ~~$34,343,856~~ Cost and expenses: Cost of products sold .........~~...............~~ 87,~~753~~530,~~821~~058 98,~~450~~872,~~287~~872 ~~27,551,220 29,035,991~~ Selling, administrative and general expenses ...~~...............~~ ~~872~~781,~~701~~876 1773,~~014,389~~806 ~~2,333,952 2,786,659~~ Interest expense ..............~~...............~~ 9351,~~398~~966 5053,~~877~~341 ~~225,430 183,730~~ ----------- ----------- ~~----------- ----------- 9~~8,~~719~~363,~~920~~900 109,~~515~~700,~~553~~019 ~~30,110,602 32,006,380~~ ----------- ----------- ~~----------- -----------~~ Income (Loss) before income taxes ........~~................~~ ~~498~~(705,~~849~~605) ~~679~~627,~~457~~165 ~~2,151,997 2,337,476~~ Income taxes (credit)...........~~........................~~ ~~170~~(240,000) ~~232~~213,000 ~~732,000 795,000~~ ----------- ----------- ~~----------- -----------~~ Net Income (Loss)......~~......................~~ $ ~~328~~(465,~~849~~605) $ ~~447~~414,~~457~~165 ~~$ 1,419,997 $ 1,542,476~~ =========== =========== ~~=========== ===========~~ Net ~~Income~~income (loss) per share .....~~......................~~ $ (.5173) $ .7165 ~~$ 2.22 $ 2.42~~ =========== =========== ~~=========== ===========~~ Dividends per share .............~~...............~~ $ .1224 $ .1224 ~~$ .48 $ .44~~ =========== =========== ~~=========== ===========~~

See notes to condensed consolidated financial statements. 4 5 FORM 10-Q MICHIGAN RIVET CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

~~Common~~Three ~~Stock~~Months ~~-----------------------------~~Ended ~~Additional~~January ~~Shares~~31 ~~Paid in Retained Outstanding Amount Capital Earnings Total~~ ----------- ---------- ------~~----~~ 2001 2000 ----------- ----------- ~~Balance,~~OPERATING ~~November~~ACTIVITIES 1,Net ~~1998~~income (loss)........................................ ~~638,525~~ $ ~~638~~(465,~~525~~605) $ ~~117~~414,~~403~~165 ~~$10,634,994~~Adjustments ~~$11,390,922~~to ~~Net~~reconcile net income, ~~nine~~(loss) ~~months~~to ~~ended~~net ~~July~~cash ~~31,~~used ~~1999~~in operating activities: Depreciation...................................... 1376,~~542~~500 339,~~476~~000 1Accrued retiree health liability.................. 59,~~542,476~~337 ~~Dividends~~44,760 ~~nine~~Cash ~~months~~provided ~~ended~~from ~~July~~(used ~~31,~~in) ~~1999~~changes in operating assets and liabilities: Accounts receivable........................... ~~(280~~2,~~951) (280~~099,~~951)~~062 ~~----------- ----------- Balance~~870,189 ~~July 31, 1999~~ Inventories................................... ~~638~~270,~~525~~000 ~~638~~11,~~525~~000 ~~117~~Prepaid expenses and other current assets..... 10,~~403~~482 117,~~896~~637 Accounts payable & other accrued expenses..... (1,~~519~~901,106) 12(1,~~652~~837,~~447~~190) ----------- -~~----------~~ ----------- -~~----------~~ ~~-----------~~NET ~~Balance~~CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 448,670 ~~November~~(150,439) 1INVESTING ACTIVITIES Acquisition of property, ~~1999~~plant and equipment.............. ~~638~~(232,~~525~~881) ~~638~~(910,~~525~~620) ~~117,403~~FINANCING ~~12,669,897~~ACTIVITIES ~~13,425,825~~ Net ~~income,~~proceeds ~~nine~~from ~~months~~short-term ~~ended July 31, 2000~~ debt........................ 130,~~419,997~~000 1,~~419~~262,~~997~~711 ~~Dividends,~~Payments ~~nine~~on ~~months~~long-term ~~ended July 31, 2000~~ debt............................... (~~306~~75,~~834~~473) (~~306~~75,~~834~~323) ~~Common Stock issued~~ Dividends................................................ 2(153,~~850~~930) 2(153,~~850~~245) ~~57,085~~------------ ~~59,935~~ ------------ NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES.............................. (199,403) 1,028,721 ------------ ------------ INCREASE (DECREASE) IN CASH.............. 16,386 (32,338) Cash at beginning of period.......................... 18,950 99,220 ------------ ------------ ~~Balance,~~CASH ~~July~~AT ~~31,~~END ~~2000~~OF PERIOD.................... ~~641,375~~ $ ~~641~~35,~~375~~336 $ ~~174~~66,~~488~~882 ~~$13,783,060 $14,598,923~~ =========== =~~==========~~ =========== =~~========== ===========~~

See notes to condensed consolidated financial statements. 5 6 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS MICHIGAN RIVET CORPORATION Results of Operations Net sales for the quarter ended January 31, 2001 of $7,658,000 decreased $2,669,000, or 25.8%, from the sales reported in the comparable period a year ago. The decrease in sales resulted from lower releases from automotive customers and price reductions. The net loss for the quarter ended January 31, 2001 was $466,000 vs. a profit of $414,000 in the comparable period a year ago. The increase in cost of sales percentage for the current fiscal year quarter is due to volume related lower absorption of fixed costs, higher hourly rates, medical expenses, utilities and equipment repairs. Selling, general, and administrative expenses were 10.2% of sales as compared to 7.5% for the previous year comparable period. This increase was due to higher directors fees and outside technical service expense. Interest expense decreased $1,000 due primarily to lower short-term borrowing during the period. The interest rate paid by the Company to Comerica Bank is tied to the prevailing prime rate. Liquidity and Capital Resources The Company has short-term credit lines aggregating $5,000,000. At January 31, 2001, $615,000 was borrowed on this facility. Additionally, cash generated from operations was 6 7 used to purchase machinery and equipment and reduce long-term debt. The Company anticipates that funds provided by operations together with funds available under its credit lines will be sufficient to meet the Company's liquidity needs for the remainder of fiscal year 2001. PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K No reports on Form 8-K were filed during the quarter ended January 31, 2001. 8 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto, duly authorized. Michigan Rivet Corporation By /s/ William P. Lianos ------------------------------- William P. Lianos President and Treasurer (Principal Financial & Accounting Officer) Date 3-05-01 ----------------------------

Nine Months Ended July 31 ------------------------------------ 2000 1999 ----------- ------------ OPERATING ACTIVITIES Net income ....................................................................... $ 1,419,997 $ 1,542,476 Adjustments to reconcile net income to net cash used in operating activities: Depreciation .............................................................. 1,059,500 958,000 Accrued retiree health liability .......................................... 121,047 129,365 Cash provided from (used in) changes in operating assets and liabilities: Accounts receivable ................................................... 573,198 1,931,616 Inventories ........................................................... 1,083,000 (447,000) Prepaid expenses and other current assets ............................. (69,988) (19,585) Accounts payable & other accrued expenses ............................. (2,376,108) (1,507,250) ----------- ----------- NET CASH PROVIDED BY OPERATING ACTIVITIES ............................................ 1,810,646 2,587,622 INVESTING ACTIVITIES Acquisition of property, plant and equipment ..................................... 2,788,674 1,162,867 FINANCING ACTIVITIES Net increase (decrease) in short-term debt ....................................... 1,584,000 (848,000) Payments on long-term debt ....................................................... (188,463) (234,324) Dividends paid ................................................................... (306,833) (280,951) New stock issued ................................................................. 59,935 ----------- ----------- NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES ...................................................... 1,148,639 (1,363,275) ----------- ----------- INCREASE (DECREASE) IN CASH ...................................... 170,611 61,480 Cash at beginning of period ........................................................ 99,220 92,125 ----------- ----------- CASH AT END OF PERIOD ............................................ $ 269,831 $ 153,605 =========== ===========

Filing Compare · MICHIGAN RIVET CORP