form10q_q12008.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-Q
x QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For
the quarterly period ended December 29, 2007
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 1-9789
TECH/OPS
SEVCON, INC.
(Exact
name of registrant as specified in its charter)
Delaware
|
04-2985631
|
(State
or other jurisdiction of incorporation or organization)
|
(I.R.S.
Employer Identification No.)
|
155
Northboro Road, Southborough, Massachusetts, 01772
(Address
of principal executive offices and zip code)
(508)
281 5510
(Registrant's
telephone number, including area code)
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 x No
o
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer or a non-accelerated filer. See definition of “accelerated
filer” and “large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
one):
Large
accelerated filer o
Accelerated Filer o
Non accelerated filer x
Indicate
by check mark whether the registrant is a shell company (as defined in rule
12b-2 of the Exchange Act). Yes o
No
x
Indicate
the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date.
Class
|
Outstanding
at February 12, 2008
|
Common
stock, par value $.10
|
3,270,702
|
FORM
10-Q
FOR
THE QUARTER ENDED DECEMBER 29, 2007
INDEX
PART
I -FINANCIAL INFORMATION
|
PAGE
|
|
3
|
|
3
|
|
4
|
|
4
|
|
5
|
|
6
|
|
12
|
|
15
|
|
16
|
|
17
|
|
17
|
|
17
|
|
17
|
|
17
|
|
17
|
|
17
|
|
17
|
|
18
|
|
18
|
Tech/Ops
Sevcon, Inc. and Subsidiaries
(in
thousands of dollars except per share data)
|
|
|
|
December
29,
2007
|
|
|
September
30,
2007
|
|
|
|
(unaudited)
|
|
|
(derived
from audited statements)
|
|
ASSETS
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash
and cash
equivalents
|
|
$ |
873 |
|
|
$ |
1,014 |
|
Receivables,
net of allowances
for doubtful accounts of $ 187 at December 29, 2007
and
$180 at September 30,
2007
|
|
|
8,549 |
|
|
|
8,714 |
|
Inventories
|
|
|
5,734 |
|
|
|
5,422 |
|
Prepaid
expenses and other
current assets
|
|
|
887 |
|
|
|
916 |
|
Total
current assets
|
|
|
16,043 |
|
|
|
16,066 |
|
Property,
plant and equipment:
|
|
|
|
|
|
|
|
|
At
cost
|
|
|
12,297 |
|
|
|
12,265 |
|
Less:
accumulated depreciation
and amortization
|
|
|
8,501 |
|
|
|
8,497 |
|
Net
property, plant and equipment
|
|
|
3,796 |
|
|
|
3,768 |
|
Long-term
deferred tax asset
|
|
|
638 |
|
|
|
657 |
|
Goodwill
|
|
|
1,435 |
|
|
|
1,435 |
|
Total
assets
|
|
$ |
21,912 |
|
|
$ |
21,926 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS’ INVESTMENT
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$ |
3,430 |
|
|
$ |
3,398 |
|
Dividend
payable
|
|
|
98 |
|
|
|
97 |
|
Accrued
expenses
|
|
|
2,863 |
|
|
|
3,162 |
|
Accrued
and deferred taxes on
income
|
|
|
651 |
|
|
|
530 |
|
Total
current liabilities
|
|
|
7,042 |
|
|
|
7,187 |
|
Liability
for pension benefits
|
|
|
2,208 |
|
|
|
2,244 |
|
Other
long term liabilities
|
|
|
60 |
|
|
|
61 |
|
Total
liabilities
|
|
|
9,310 |
|
|
|
9,492 |
|
Stockholder
equity:
|
|
|
|
|
|
|
|
|
Preferred
stock, par value $.10
per share - authorized - 1,000,000 shares;
outstanding
-
none
|
|
|
- |
|
|
|
- |
|
Common
stock, par value $.10 per
share - authorized - 8,000,000 shares;
Outstanding
3,257,702 shares at
December 29, 2007 and 3,238,702 shares at
September
30,
2007
|
|
|
326 |
|
|
|
324 |
|
Premium
paid in on common
stock
|
|
|
4,696 |
|
|
|
4,623 |
|
Retained
earnings
|
|
|
8,175 |
|
|
|
7,961 |
|
Cumulative
other comprehensive
loss
|
|
|
(595 |
) |
|
|
(474 |
) |
Total
stockholder equity
|
|
|
12,602 |
|
|
|
12,434 |
|
Total
liabilities and stockholder equity
|
|
$ |
21,912 |
|
|
$ |
21,926 |
|
The
accompanying notes are an integral part of these consolidated financial
statements
|
|
(Unaudited)
Tech/Ops
Sevcon, Inc. and Subsidiaries
(in
thousands of dollars except per share data)
|
|
|
|
Three
months ended
|
|
|
|
December
29,
2007
|
|
|
December
30,
2006
|
|
Net
sales
|
|
$ |
10,243 |
|
|
$ |
8,226 |
|
Cost
of sales
|
|
|
6,361 |
|
|
|
5,228 |
|
Gross
Profit
|
|
|
3,882 |
|
|
|
2,998 |
|
Selling,
research and administrative expenses
|
|
|
3,297 |
|
|
|
2,794 |
|
Operating
income
|
|
|
585 |
|
|
|
204 |
|
Interest
expense
|
|
|
(30 |
) |
|
|
(5 |
) |
Interest
income
|
|
|
2 |
|
|
|
2 |
|
Foreign
currency loss
|
|
|
(75 |
) |
|
|
(67 |
) |
Income
before income taxes
|
|
|
482 |
|
|
|
134 |
|
Income
taxes
|
|
|
(169 |
) |
|
|
(46 |
) |
Net
income
|
|
$ |
313 |
|
|
$ |
88 |
|
Basic
income per share
|
|
$ |
.10 |
|
|
$ |
.03 |
|
Fully
diluted income per share
|
|
$ |
.10 |
|
|
$ |
.03 |
|
(Unaudited)
Tech/Ops
Sevcon, Inc. and Subsidiaries
|
|
(in
thousands of dollars)
|
|
|
|
Three
months ended
|
|
|
|
December
29,
2007
|
|
|
December
30,
2006
|
|
Net
income
|
|
$ |
313 |
|
|
$ |
88 |
|
Foreign
currency translation adjustment
|
|
|
(76 |
) |
|
|
315 |
|
Changes
in fair market value of cash flow hedges
|
|
|
(57 |
) |
|
|
- |
|
Amortization
of pension transition items to income
|
|
|
11 |
|
|
|
12 |
|
Comprehensive
income
|
|
$ |
191 |
|
|
$ |
415 |
|
The
accompanying notes are an integral part of these consolidated financial
statements.
(Unaudited)
Tech/Ops
Sevcon, Inc. and Subsidiaries
|
|
(in
thousands of dollars)
|
|
|
|
Three
months ended
|
|
|
|
December
29,
2007
|
|
|
December
30,
2006
|
|
Cash
flow from operating activities:
|
|
|
|
|
|
|
Net
income
|
|
$ |
313 |
|
|
$ |
88 |
|
Adjustments
to reconcile net income to net cash from operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation
and
amortization
|
|
|
179 |
|
|
|
178 |
|
Stock-based
compensation
|
|
|
58 |
|
|
|
47 |
|
Pension
contributions less than
pension expense
|
|
|
23 |
|
|
|
- |
|
Deferred
tax
benefit
|
|
|
- |
|
|
|
(35 |
) |
Increase
(decrease) in cash
resulting from changes in operating assets and
liabilities:
|
|
|
|
|
|
|
|
|
Receivables
|
|
|
211 |
|
|
|
(26 |
) |
Inventories
|
|
|
(376 |
) |
|
|
84 |
|
Prepaid
expenses and other
current assets
|
|
|
6 |
|
|
|
(28 |
) |
Accounts
payable
|
|
|
120 |
|
|
|
336 |
|
Accrued
expenses
|
|
|
(331 |
) |
|
|
(262 |
) |
Accrued
and deferred taxes on
income
|
|
|
123 |
|
|
|
9 |
|
Net
cash generated from operating activities
|
|
|
326 |
|
|
|
391 |
|
Cash
flow used by investing activities:
|
|
|
|
|
|
|
|
|
Acquisition
of property, plant and
equipment
|
|
|
(287 |
) |
|
|
(237 |
) |
Net
cash used by investing activities
|
|
|
(287 |
) |
|
|
(237 |
) |
Cash
flow used by financing activities:
|
|
|
|
|
|
|
|
|
Dividends
paid
|
|
|
(97 |
) |
|
|
(96 |
) |
Exercise
of stock
options
|
|
|
18 |
|
|
|
- |
|
Net
cash used by financing
activities
|
|
|
(79 |
) |
|
|
(96 |
) |
Effect
of exchange rate changes on cash
|
|
|
(101 |
) |
|
|
278 |
|
Net
(decrease) increase in cash
|
|
|
(141 |
) |
|
|
336 |
|
Beginning
balance - cash and cash equivalents
|
|
|
1,014 |
|
|
|
1,290 |
|
Ending
balance - cash and cash equivalents
|
|
$ |
873 |
|
|
$ |
1,626 |
|
Supplemental
disclosure of cash flow information:
|
|
|
|
|
|
|
|
|
Cash
paid for income
taxes
|
|
$ |
80 |
|
|
$ |
196 |
|
Cash
paid for
interest
|
|
$ |
29 |
|
|
$ |
5 |
|
Supplemental
disclosure of non-cash financing activity:
|
|
|
|
|
|
|
|
|
Dividend
declared
|
|
$ |
98 |
|
|
$ |
96 |
|
The
accompanying notes are an integral part of these consolidated financial
statements.
Notes
to Consolidated Financial Statements – December 29, 2007
(Unaudited)
(1)
|
Basis
of Presentation
|
In
the opinion of management, the
accompanying unaudited condensed consolidated financial statements contain
all
adjustments (consisting of only normally recurring accruals) necessary to
present fairly the financial position of Tech/Ops Sevcon, Inc. as of December
29, 2007 and the results of operations and cash flows for the three months
ended
December 29, 2007 and December 30, 2006.
The
significant accounting policies
followed by Tech/Ops Sevcon, Inc. are set forth in Note 1 to the financial
statements in the 2007 Tech/Ops Sevcon, Inc. Annual Report filed on Form 10-K.
Other than as set forth below, there have been no changes since the end of
fiscal 2007 to the significant accounting policies followed by Tech/Ops Sevcon,
Inc.
The
results of operations for the three
month periods ended December 29, 2007 and December 30, 2006 are not necessarily
indicative of the results to be expected for the full year.
(2)
New Accounting Pronouncements
In
June 2006 the Financial Accounting
Standards Board (FASB) issued Interpretation No. 48 “Accounting for Uncertainty
in Income Taxes” (“FIN 48”) which is effective for fiscal years beginning after
December 15, 2006. FIN 48 prescribes detailed guidance for the financial
statement recognition, measurement and disclosure of uncertain tax positions
recognized in an enterprise’s financial statements in accordance with Statement
of Financial Accounting Standard (SFAS)
No. 109. Tax positions must meet a more-likely-than-not recognition threshold
at
the effective date to be recognized upon the adoption of FIN 48, and in
subsequent periods. The Company has evaluated the impact of adopting FIN 48
on
its consolidated results of operations and financial position and has concluded
that its adoption does not have a material impact on either the consolidated
results from operations or its financial position.
In
September 2006, the Securities and
Exchange Commission issued Staff Accounting Bulletin (“SAB”) No. 108,
“Considering the Effects of Prior Year Misstatements when Quantifying Current
Year Misstatements”. SAB No. 108 requires analysis of misstatements using both
an income statement (rollover) approach and a balance sheet (iron curtain)
approach in assessing materiality and provides for a one-time cumulative effect
transition adjustment. SAB No. 108 was effective for our fiscal year 2007 annual
financial statements. This did not have a material impact on the Company’s
financial statements.
In
September 2006, the FASB issued SFAS
No. 157, “Fair Value Measurements”, which defines fair value, establishes a
framework for measuring fair value in generally accepted accounting principles,
and expands disclosures about fair value measurements. SFAS No. 157 does not
require any new fair value measurements, but provides guidance on how to measure
fair value by providing a fair value hierarchy used to classify the source
of
the information. This statement will be effective for the Company beginning
October 1, 2008. This is not expected to have a material impact on the Company’s
financial statements.
In
September 2006, the FASB issued SFAS
No. 158, "Employers’ Accounting for Defined Benefit Pension and Other
Postretirement Plans – an amendment of FASB Statements No. 87, 88, 106, and
132(R)." SFAS No. 158 requires an employer to recognize a plan’s over funded or
under funded status in its balance sheets and recognize the changes in a plan’s
funded status in comprehensive income in the year which the changes occur.
The
Company adopted SFAS No. 158 effective on September 30, 2006. In addition,
SFAS
No. 158 requires an employer to measure plan assets and obligations that
determine its funded status as of the end of its fiscal year. There was no
impact on the income statement in either fiscal 2007 or 2006 arising from the
adoption of SFAS No. 158.
In
February 2007, the FASB issued SFAS
No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities”
(SFAS 159), which permits entities to choose to measure many financial
instruments and certain other items at fair value that are not currently
required to be measured at fair value. SFAS No. 159 will be effective for the
Company on October 1, 2008. This is not expected to have a material impact
on
the Company’s financial statements.
(3)
Stock-Based Compensation Plans
Under
the Company’s 1996 Equity
Incentive Plan (the “Plan”) there were 85,500 shares reserved and available for
grant at December 29, 2007. Recipients of grants or options must execute a
standard form of non-competition agreement. The plan provides for the grant
of
Restricted Stock, Restricted Stock Units, Options, and Stock Appreciation Rights
(SARs). Stock Appreciation Rights may be awarded either separately, or in
relation to options granted, and for the grant of bonus shares. Options granted
are exercisable at a price not less than fair market value on the date of
grant.
Since
the beginning of fiscal 2006 the
Company has accounted for stock based compensation under SFAS 123R
“Share-Based Payment,” which defines a fair value based method of accounting for
employee stock options or similar equity instruments.
The
fair value of each option grant is
estimated on the date of grant using the Black-Scholes option pricing model.
There were no option grants in the first quarter of fiscal 2008 or in fiscal
2007 and therefore no assumptions were made as to risk-free interest rate,
expected dividend yield, expected life or expected volatility in fiscal 2008
or
fiscal 2007. When options are exercised the Company normally issues new
shares.
A
summary of option activity for all
plans for the three months ended December 29, 2007 is as follows:
|
|
Options
No.
of shares
|
|
|
Weighted
average Exercise Price
|
|
|
Weighted
average remaining contractual life (years)
|
|
|
Aggregate
Intrinsic Value
|
|
Outstanding
at September 30, 2007
|
|
|
129,000 |
|
|
$ |
9.47 |
|
|
|
2.0 |
|
|
|
204,000 |
|
Granted
|
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
Exercised
|
|
|
(4,000 |
) |
|
$ |
4.37 |
|
|
|
|
|
|
|
|
|
Cancelled
|
|
|
(22,500 |
) |
|
$ |
13.93 |
|
|
|
|
|
|
|
|
|
Outstanding
at December 29, 2007
|
|
|
102,500 |
|
|
$ |
8.80 |
|
|
|
2.3 |
|
|
$ |
133,000 |
|
Exercisable
at December 29, 2007
|
|
|
72,500 |
|
|
$ |
9.77 |
|
|
|
2.7 |
|
|
$ |
69,000 |
|
The
aggregate intrinsic value included
in the table above represents the difference between the exercise price of
the
options and the market price of the Company’s common stock for the options that
had exercise prices that were lower than the $7.50 market price of the Company’s
common stock at December 29, 2007. Options for 4,000 shares were exercised
during the three month period ended December 29, 2007. The total intrinsic
value
of options exercised in the three month period ended December 29, 2007, was
$18,000 and the proceeds received on the exercise of these options was $17,000.
In the first three months of the last fiscal year, no options were exercised.
At
December 29, 2007 there was $53,000 of total unrecognized compensation expense
related to options granted under all equity compensation plans. The Company
expects to recognize that cost over a weighted average period of 2.9
years.
In
December 2007, the Company granted
15,000 shares of restricted stock to one employee which will vest in five equal
annual installments so long as the employee is then employed by the Company
or
as determined by the Compensation Committee. The estimated fair value of the
stock on the date of grant was $117,000 based on the fair market value of stock
on the date of issue. This unearned compensation is being charged to income
on a
straight line basis over five years. The charge to income for this employee’s
restricted stock grant in the first quarter of fiscal 2008 was nil and the
subsequent charge will be approximately $6,000 on a quarterly
basis.
During
the restriction period ownership
of unvested shares cannot be transferred. Restricted stock has the same cash
dividend and voting rights as other common stock and is considered to be
currently issued and outstanding. For the purposes of calculating average issued
shares for earnings per share these shares are only considered to be outstanding
when the forfeiture conditions lapse and the shares vest.
Restricted
stock activity for the three
months ended December 29, 2007 was as follows:
|
|
Number
of shares of Restricted Stock
|
|
|
Weighted
Average Grant-Date Fair Value
|
|
Non-vested
balance as of September 30, 2007
|
|
|
55,000 |
|
|
$ |
6.22 |
|
Granted
|
|
|
15,000 |
|
|
$ |
8.80 |
|
Vested
|
|
|
(14,000 |
) |
|
$ |
6.11 |
|
Forfeited
|
|
|
- |
|
|
|
N/A |
|
Non-vested
balance as of December 29, 2007
|
|
|
56,000 |
|
|
$ |
6.94 |
|
As
of December 29, 2007, there was
$269,000 of total restricted stock compensation expense related to non-vested
awards not yet recognized, which is expected to be recognized over a weighted
average period of 3.5 years.
The
stock-based compensation expense
was as follows:
|
|
(in
thousands of dollars)
|
|
|
|
Three
Months ended
|
|
|
|
December
29,
2007
|
|
|
December
30,
2006
|
|
Stock
option expense under SFAS # 123R
|
|
$ |
6 |
|
|
$ |
11 |
|
Restricted
stock grants:
|
|
|
|
|
|
|
|
|
Employees
|
|
|
29 |
|
|
|
19 |
|
Non-employee
directors
|
|
|
23 |
|
|
|
17 |
|
Total
stock based compensation expense
|
|
$ |
58 |
|
|
$ |
47 |
|
(4)
Cash Dividends
On
December 4, 2007, the Company
declared a quarterly dividend of $.03 per share for the first quarter of fiscal
2008, which was paid on January 3, 2008 to stockholders of record on December
19, 2007. The Company has paid regular quarterly cash dividends since the first
quarter of fiscal 1990.
(5)
Calculation of Earnings per Share and Weighted Average Shares
Outstanding
Basic
and fully diluted earnings per
share were calculated as follows:
|
|
(in
thousands except per share data)
|
|
|
|
Three
Months ended
|
|
|
|
December
29,
2007
|
|
|
December
30,
2006
|
|
Net
income
|
|
$ |
313 |
|
|
$ |
88 |
|
Weighted
average shares outstanding - basic
|
|
|
3,188 |
|
|
|
3,147 |
|
Basic
income per share
|
|
$ |
.10 |
|
|
$ |
.03 |
|
Common
stock equivalents
|
|
|
47 |
|
|
|
46 |
|
Weighted
average shares outstanding - diluted
|
|
|
3,235 |
|
|
|
3,193 |
|
Diluted
income per share
|
|
$ |
.10 |
|
|
$ |
.03 |
|
No.
of options that are anti-dilutive excluded from calculation of common
stock equivalents
|
|
|
80 |
|
|
|
90 |
|
(6)
Segment information
The
Company has two reportable
segments: electronic controls and capacitors. The electronic controls segment
produces control systems and accessories for battery powered vehicles. The
capacitor segment produces electronic components for sale to electronic
equipment manufacturers. Each segment has its own management team, manufacturing
facilities and sales force.
The
significant accounting policies of
the segments are the same as those described in note (1) to the 2007 Annual
Report filed on Form 10-K. Inter-segment revenues are accounted for at current
market prices. The Company evaluates the performance of each segment principally
based on operating income. The Company does not allocate income taxes, interest
income and expense or foreign currency translation gains and losses to segments.
Information concerning operations of these businesses is as
follows:
|
|
(in
thousands of dollars)
|
|
|
|
Three
months ended December 29, 2007
|
|
|
|
Controls
|
|
|
Capacitors
|
|
|
Corporate
|
|
|
Total
|
|
Sales
to external customers
|
|
$ |
9,707 |
|
|
$ |
536 |
|
|
$ |
- |
|
|
$ |
10,243 |
|
Inter-segment
revenues
|
|
|
- |
|
|
|
12 |
|
|
|
- |
|
|
|
12 |
|
Operating
income
|
|
|
651 |
|
|
|
(34 |
) |
|
|
(32 |
) |
|
|
585 |
|
Identifiable
assets
|
|
|
20,504 |
|
|
|
917 |
|
|
|
491 |
|
|
|
21,912 |
|
|
|
Three
months ended December 30, 2006
|
|
|
|
Controls
|
|
|
Capacitors
|
|
|
Corporate
|
|
|
Total
|
|
Sales
to external customers
|
|
$ |
7,803 |
|
|
$ |
423 |
|
|
$ |
- |
|
|
$ |
8,226 |
|
Inter-segment
revenues
|
|
|
- |
|
|
|
15 |
|
|
|
- |
|
|
|
15 |
|
Operating
income
|
|
|
319 |
|
|
|
(75 |
) |
|
|
(40 |
) |
|
|
204 |
|
Identifiable
assets
|
|
|
17,763 |
|
|
|
1,028 |
|
|
|
419 |
|
|
|
19,210 |
|
In
the controls business segment the
revenues were derived from the following products and services:
|
|
(in
thousands of dollars)
|
|
|
|
Three
Months ended
|
|
|
|
December
29,
2007
|
|
|
December
30,
2006
|
|
Electronic
controllers for battery driven vehicles
|
|
$ |
6,693 |
|
|
$ |
5,176 |
|
Accessory
and aftermarket products and services
|
|
|
3,014 |
|
|
|
2,627 |
|
Total
controls segment revenues
|
|
$ |
9,707 |
|
|
$ |
7,803 |
|
(7)
Research and Development
The
cost of research and development
programs is charged against income as incurred and was as follows:
|
|
(in
thousands of dollars)
|
|
|
|
Three
Months ended
|
|
|
|
December
29,
2007
|
|
|
December
30,
2006
|
|
Research
and Development expense
|
|
$ |
1,078 |
|
|
$ |
895 |
|
Percentage
of sales
|
|
|
10.5 |
|
|
|
10.9 |
|
(8)
Employee Benefit Plans
Tech/Ops
Sevcon has defined benefit
plans covering the majority of its US and UK employees. There is also a small
defined contribution plan. The following table sets forth the components of
the
net pension cost as defined by SFAS No. 158:
|
|
(in
thousands of dollars)
|
|
|
|
Three
Months ended
|
|
|
|
December
29,
2007
|
|
|
December
30,
2006
|
|
Service
cost
|
|
$ |
153 |
|
|
$ |
145 |
|
Interest
cost
|
|
|
350 |
|
|
|
283 |
|
Expected
return on plan assets
|
|
|
(347 |
) |
|
|
(280 |
) |
Amortization
of prior service cost
|
|
|
15 |
|
|
|
14 |
|
Recognized
net actuarial gain (loss)
|
|
|
- |
|
|
|
3 |
|
Net
periodic benefit cost
|
|
|
171 |
|
|
|
165 |
|
Net
cost of defined contribution plans
|
|
$ |
11 |
|
|
$ |
11 |
|
The
following table sets forth the
movement in the liability for pension benefits in accordance with SFAS No.
158
in the three months ended December 29, 2007:
|
|
(in
thousands of dollars)
|
|
|
|
Three
Months ended
|
|
|
|
December
29,
2007
|
|
|
December
30,
2006
|
|
Liability
for pension benefits at beginning of period
|
|
$ |
2,244 |
|
|
$ |
2,886 |
|
Net
periodic benefit cost
|
|
|
174 |
|
|
|
165 |
|
Plan
contributions
|
|
|
(155 |
) |
|
|
(153 |
) |
Effect
of exchange rate changes
|
|
|
(55 |
) |
|
|
94 |
|
Balance
at end of period
|
|
$ |
2,208 |
|
|
$ |
2,992 |
|
Tech/Ops
Sevcon did not contribute to
its US pension plan in the three months ended December 29, 2007 and presently
anticipates contributing $129,000 to fund its plan in the remainder of fiscal
2008. In addition employee contributions to the UK plan were $155,000 in the
first three months and are estimated to total $647,000 in fiscal
2008.
The
table below sets out the movement
in the amounts included in accumulated other comprehensive income that has
not
yet been recognized as pension costs in the income statement:
|
|
Unrecognized
transition obligation
|
|
|
Unrecognized
prior service cost
|
|
|
Unrecognized
net actuarial gain (loss)
|
|
|
Deferred
Tax
|
|
|
Total
|
|
Balance
at September 30, 2007
|
|
$ |
1 |
|
|
$ |
510 |
|
|
$ |
1,514 |
|
|
$ |
(610 |
) |
|
$ |
1,415 |
|
Amounts
recognized in accumulated other comprehensive income in the first
quarter
of fiscal 2008
|
|
|
- |
|
|
|
(15 |
) |
|
|
- |
|
|
|
4 |
|
|
|
(11 |
) |
Balance
at December 29, 2007
|
|
$ |
1 |
|
|
$ |
495 |
|
|
$ |
1,514 |
|
|
$ |
(606 |
) |
|
$ |
1,404 |
|
Amounts
expected to be recognized in the remainder of fiscal 2008
|
|
|
- |
|
|
|
(45 |
) |
|
|
- |
|
|
|
12 |
|
|
|
(33 |
) |
(9)
Inventories
Inventories
were comprised
of:
|
|
(in
thousands of dollars)
|
|
|
|
December
29,
2007
|
|
|
September
30,
2007
|
|
Raw
materials
|
|
$ |
3,016 |
|
|
$ |
2,517 |
|
Work-in-process
|
|
|
212 |
|
|
|
134 |
|
Finished
goods
|
|
|
2,506 |
|
|
|
2,771 |
|
|
|
$ |
5,734 |
|
|
$ |
5,422 |
|
(10)
Accrued expenses
Set
out below is an analysis of other
accrued expenses at December 29, 2007 and September 30, 2007 which shows
separately any items in excess of 5% of total current liabilities:
|
|
(in
thousands of dollars)
|
|
|
|
December
29,
2007
|
|
|
September
30,
2007
|
|
Accrued
compensation and related costs
|
|
$ |
730 |
|
|
$ |
1,118 |
|
Warranty
reserves
|
|
|
443 |
|
|
|
458 |
|
Other
accrued expenses
|
|
|
1,690 |
|
|
|
1,586 |
|
|
|
$ |
2,863 |
|
|
$ |
3,162 |
|
(11)
Warranty reserves
The
movement in warranty reserves was
as follows:
|
|
(in
thousands of dollars)
|
|
|
|
Three
Months Ended
|
|
|
|
December
29,
2007
|
|
|
December
30,
2006
|
|
Warranty
reserves at beginning of period
|
|
$ |
458 |
|
|
$ |
364 |
|
Decrease
in beginning balance for warranty obligations settled during the
period
|
|
|
(146 |
) |
|
|
(109 |
) |
Other
changes to pre-existing warranties
|
|
|
- |
|
|
|
10 |
|
Net
increase in warranty reserves for products sold during the
period
|
|
|
131 |
|
|
|
125 |
|
Warranty
reserves at end of period
|
|
$ |
443 |
|
|
$ |
390 |
|
FORWARD
LOOKING STATEMENTS
Statements
in this discussion and
analysis about the Company’s anticipated financial results and growth, as well
as those about the development of its products and markets, are forward-looking
statements that involve risks and uncertainties that could cause actual results
to differ materially from those projected. These include the risks discussed
under ‘Risk Factors’ below and throughout this Item 2.
NEW
ACCOUNTING PRONOUNCEMENTS
The
Company adopted SFAS No. 158 on
September 30, 2006. See Note 2 to Consolidated Financial Statements for a more
detailed description of this new accounting pronouncement.
In
June 2006, the FASB issued FIN48,
“Accounting for Uncertainty in Income Taxes”. This interpretation prescribes a
recognition threshold and measurement attribute for the financial statement
recognition and measurement of a tax position taken or expected to be taken
in a
tax return. The interpretation also provides guidance on classification,
interest and penalties, accounting in interim periods, disclosure and
transition. FIN48 became effective for fiscal years beginning after December
15,
2006. The Company has evaluated the impact of adopting FIN 48 on its
consolidated results of operations and financial position and has concluded
that
its adoption did not have a material impact on either the consolidated results
from operations or its financial position.
CRITICAL
ACCOUNTING ESTIMATES
As
of December 29, 2007 there have been
no material changes to the critical accounting estimates described in the
Company’s Form 10-K for the year ended September 30, 2007.
Pension
Plan Assumptions
The
Company’s pension plans are
significant relative to the size of the Company. Pension plan assets were
$22,280,000 at September 30, 2007 and the total assets of the Company were
$21,926,000. Although the plan assets are not included in the assets of the
Company, they are 102% of size of the Company’s total assets. In accordance with
SFAS No. 158 the funded status of the pension plans (plan assets less the
accumulated benefit obligation) is recognized in the Company’s balance sheet as
“Liability for pension benefits” which amounted to $2,208,000 at December 29,
2007 compared to $2,244,000 at September 30, 2007.
The
Company makes a number of
assumptions relating to its pension plans in order to measure the financial
position of the plans and the net periodic benefit cost. The most significant
assumptions relate to the discount rate, the expected long term return on plan
assets and the rate of future compensation increase. If these assumptions prove
to be incorrect then the Company may need to record additional expense relating
to the pension plans which could have a material effect on the Company’s results
of operations.
The
table below sets out the
approximate impact on the funded status of the Company’s pension plans at
September 30, 2007 that the Company estimates would arise from the following
respective changes in significant plan assumptions:
Plan
Assumption
|
Change
in Assumption
|
Impact
on Funded Status
(in
thousands of dollars)
|
Change
in funded status
|
Assumptions
impacting accumulated benefit obligation:
|
|
|
|
Discount
rate
|
0.1%
|
$550
|
22%
|
Inflation
rate
|
0.1%
|
330
|
13%
|
Salary
Increase
|
0.1%
|
770
|
31%
|
Mortality
rate
|
1
year
|
550
|
22%
|
Assumption
impacting plan assets:
|
|
|
|
Return
on plan assets
|
0.1%
per year
|
$20
per year
|
1%
per year
|
OVERVIEW
OF FIRST QUARTER
Sales
in the first quarter ended
December 29, 2007 increased by 25% to $10,243,000 compared to $8,226,000 last
year. Volumes shipped were up by 18% and a further gain of 7% was due to the
weakness of the US dollar compared to European currencies. The Company achieved
sales increases in all of its businesses due to increased volumes
shipped.
Increased
volumes shipped and favorable
sales mix improved gross margins, which were 37.9% of sales compared to 36.4%
in
the first quarter of fiscal 2007. Operating expenses were higher than last
year
due to both increased sales and engineering spend on the introduction of new
products and foreign currency fluctuations. Operating income was $585,000
compared with $204,000 in the first quarter last year, an increase of
187%.
Net
income for the quarter was 256% ahead of last year at $313,000. Foreign currency
changes increased net income by $44,000; before the impact of foreign currency,
net income was up by $269,000 or 206%. Diluted net income per share was $.10
compared to $.03 last year.
Cash
balances reduced by $141,000 in the first three months of fiscal 2008 to
$873,000. Operating activities generated cash of $326,000. Capital expenditures
used cash of $287,000 and dividend payments amounted to $97,000. Exchange rates
reduced cash by $101,000.
Results
of Operations
Three
months ended December 29, 2007
The
following table compares results by
segment for the first quarter of fiscal 2008 with the prior year period and
shows the percentage changes in total and split between the currency impact
and
volume / other changes:
|
|
Three
months ended
|
|
|
%
change due to:
|
|
|
|
December
29, 2007
|
|
|
December
30,
2006
|
|
|
Total
|
|
|
Currency
|
|
|
Volume
/ other
|
|
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Controls
- to external
customers
|
|
$ |
9,707 |
|
|
$ |
7,803 |
|
|
|
25% |
|
|
|
7% |
|
|
|
18% |
|
Capacitors-
to external
customers
|
|
|
536 |
|
|
|
423 |
|
|
|
26% |
|
|
|
6% |
|
|
|
20% |
|
Capacitors
-
inter-segment
|
|
|
12 |
|
|
|
15 |
|
|
|
-20% |
|
|
|
3% |
|
|
|
-23% |
|
Capacitors
–
total
|
|
|
548 |
|
|
|
438 |
|
|
|
25% |
|
|
|
6% |
|
|
|
19% |
|
Total
sales to external
customers
|
|
|
10,243 |
|
|
|
8,226 |
|
|
|
25% |
|
|
|
7% |
|
|
|
18% |
|
Gross
Profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Controls
|
|
|
3,686 |
|
|
|
2,866 |
|
|
|
29% |
|
|
|
8% |
|
|
|
21% |
|
Capacitors
|
|
|
196 |
|
|
|
132 |
|
|
|
49% |
|
|
|
7% |
|
|
|
42% |
|
Total
|
|
|
3,882 |
|
|
|
2,998 |
|
|
|
30% |
|
|
|
8% |
|
|
|
22% |
|
Selling
research and administrative expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Controls
|
|
|
3,035 |
|
|
|
2,547 |
|
|
|
19% |
|
|
|
-6% |
|
|
|
25% |
|
Capacitors
|
|
|
230 |
|
|
|
207 |
|
|
|
11% |
|
|
|
-6% |
|
|
|
17% |
|
Unallocated
corporate
expense
|
|
|
32 |
|
|
|
40 |
|
|
|
-20% |
|
|
|
0% |
|
|
|
-20% |
|
Total
|
|
|
3,297 |
|
|
|
2,794 |
|
|
|
18% |
|
|
|
-6% |
|
|
|
24% |
|
Operating
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Controls
|
|
|
651 |
|
|
|
319 |
|
|
|
104% |
|
|
|
25% |
|
|
|
79% |
|
Capacitors
|
|
|
(34 |
) |
|
|
(75 |
) |
|
|
-55% |
|
|
|
4% |
|
|
|
-59% |
|
Unallocated
corporate
expense
|
|
|
(32 |
) |
|
|
(40 |
) |
|
|
-20% |
|
|
|
0% |
|
|
|
-20% |
|
Total
|
|
|
585 |
|
|
|
204 |
|
|
|
187% |
|
|
|
39% |
|
|
|
148% |
|
Other
income and expense
|
|
|
(103 |
) |
|
|
(70 |
) |
|
|
47% |
|
|
|
14% |
|
|
|
33% |
|
Income
before income taxes
|
|
|
482 |
|
|
|
134 |
|
|
|
260% |
|
|
|
51% |
|
|
|
209% |
|
Income
taxes
|
|
|
(169 |
) |
|
|
(46 |
) |
|
|
266% |
|
|
|
52% |
|
|
|
214% |
|
Net
Income
|
|
$ |
313 |
|
|
$ |
88 |
|
|
|
256% |
|
|
|
50% |
|
|
|
206% |
|
Sales
in the first fiscal quarter ended
December 29, 2007 were $10,243,000 compared to $8,226,000 in the same period
last year, an increase of $2,017,000, or 25 %. In the first fiscal quarter
the
US dollar weakened by 5% and 12% against the British Pound and the Euro,
respectively, compared to the first fiscal quarter of 2007. These foreign
currency fluctuations accounted for a 7% increase in reported sales while
volumes were 18% higher than last year. Volumes in the controller business
were
18% higher than the same period last year, with gains reported in all business
units. The increased revenues in the controls segment were mainly due to
broadly-based higher levels of demand across most of the Company’s customer base
and the introduction of new products. In the capacitor business, sales to
external customers increased by $113,000, or 26%, compared to the same period
last year. Capacitor volumes were 20% up compared to the same period last year
with gains across most market sectors and continued improvement in the sales
volumes of audio capacitors. Foreign currency fluctuations accounted for a
$26,000, or 6% increase in reported sales of capacitors.
The
gross profit percentage was 37.9%
of sales in this period compared with 36.4% in the comparable period in fiscal
2007. Gross profit increased by $884,000 compared to the first quarter of last
year. Foreign currency fluctuations increased reported gross profit by $233,000.
Net of the currency impact, gross profit was $651,000 above last year. The
increase in gross profit was mainly due to higher volumes.
Selling,
research and administrative
expenses were $3,297,000, an increase of $503,000 compared to the same period
last year. Foreign currency fluctuations increased reported operating expenses
by $155,000, or 6%. Excluding the impact of currency fluctuations, operating
expenses for the first quarter were $348,000, or 12% higher than the same period
last year. Operating expenses were higher than last year largely due to
increased sales and engineering spend on the introduction of new products,
as
well as foreign currency fluctuations.
Operating
income for the first quarter
was $585,000, an increase of $381,000, or 187%, compared to the same period
last
year. Foreign currency fluctuations had an overall positive impact of $78,000
on
reported operating income. Excluding the currency impact, operating income
for
the controller business increased by $251,000, mainly due to higher volumes.
In
the capacitor business segment there was an operating loss of $34,000 compared
to an operating loss of $75,000 in the first quarter of fiscal
2007.
In
the first quarter interest expense
was $30,000, an increase of $25,000 compared to the prior year. There was a
foreign currency loss of $75,000 in the first quarter of fiscal 2008 compared
to
a loss of $67,000 in the same period last year.
Income
before income taxes was $482,000
compared to $134,000 in the same period last year, an increase of $348,000,
or
260%. Income taxes were 35.0% of pre-tax income, in line with the same period
last year. Net income for the first quarter was $313,000, an increase of
$225,000 compared to the same period last year. Basic and fully diluted income
per share was $.10 compared to $.03 per share in the first quarter of fiscal
2007.
Financial
Condition
The
Company has, since January 1990,
maintained a program of regular cash dividends. The dividend for the first
quarter of fiscal 2008 was paid on January 3, 2008, and amounted to $98,000.
Cash balances at the end of the first quarter of 2008 were $873,000, compared
to
$1,014,000 on September 30, 2007, a decrease in cash of $141,000 in the first
three months of fiscal 2008.
In
the first quarter of fiscal 2008,
net income was $313,000, and operating activities generated $326,000 of cash.
Receivables decreased by $165,000 to $8,549,000. The number of days sales in
receivables reduced in the first three months of fiscal 2008 from 76 days to
70
days.
Inventories
increased by $312,000,
largely due to higher volumes. Prepaid expense and other current assets
decreased by $29,000 to $887,000. Accounts payable of $3,430,000 were in line
with the balance at September 30, 2007 of $3,397,000. Accrued expenses of
$2,863,000 were lower by $299,000 than the balance at September 30, 2007.
Accrued income taxes increased by $121,000. Dividends paid in the first three
months of fiscal 2008 amounted to $97,000. Capital expenditures in the first
three months were $287,000. Exchange rate changes decreased reported cash by
$101,000 in the first three months of fiscal 2008.
The
Company has no long-term debt but
has overdraft facilities in the UK of approximately $2 million and of $200,000
in France. At the end of the first quarter the Company had no borrowings against
these overdraft facilities. The UK overdraft facilities are secured by all
of
the Company’s assets in the UK and the French overdraft facilities are
unsecured.
Tech/Ops
Sevcon's capital resources, in
the opinion of management, are adequate for projected operations and capital
spending programs. Capital spending programs are not expected to be
significantly higher than depreciation over the next twelve months and projected
volume growth is not expected to require significant additional cash
resources.
Item
3 Quantitative and Qualitative Disclosures about Market Risk.
The
Company’s operations are sensitive
to a number of market factors, any one of which could materially adversely
affect its results of operations in any given year. Other risks dealing with
contingencies are described in Note 6 to the Company’s Consolidated Financial
Statements included under Item 8 of the Company’s Form 10-K for the year ended
September 30, 2007 and other risks are described under the caption Risk Factors
in Part II, Item 1A below.
Foreign
currency risk
The
Company sells to customers
throughout the industrialized world. The majority of the Company’s products are
manufactured in, or sourced from, the United Kingdom. In the first three months
of fiscal 2008, approximately 41% of the Company’s sales were made in US
Dollars, 27% were made in British Pounds and 32% were made in Euros. Over 70%
of
the Company’s cost of sales was incurred in British Pounds. This resulted in the
Company’s sales and margins being exposed to fluctuations due to the change in
the exchange rates of the US Dollar, the British Pound and the Euro. The Company
has trade accounts receivable and accounts payable denominated in both British
pounds and Euros which are exposed to exchange fluctuations.
In
addition, the translation of the
sales and income of foreign subsidiaries into US Dollars is also subject to
fluctuations in foreign currency exchange rates.
The
Company undertakes hedging
activities from time-to-time to manage the foreign exchange exposures related
to
forecasted purchases and sales in foreign currency and the associated foreign
currency denominated receivables and payables. The Company does not engage
in
speculative foreign exchange transactions. Details of this hedging activity
and
the underlying exposures are set out below.
The
following table provides
information about the Company’s foreign currency accounts receivable, accounts
payable, firmly committed sales contracts and derivative financial instruments
outstanding as of December 29, 2007. The information is provided in US Dollar
amounts, as presented in the Company’s consolidated financial statements. The
table presents the notional amount (at contract exchange rates) and the weighted
average contractual foreign currency exchange rates.
|
|
(in
thousands of dollars, except average contract rates)
|
|
|
|
Expected
maturity or
transaction date
|
|
|
|
|
|
|
FY2008
|
|
|
FY2009
|
|
|
Total
|
|
|
Fair
Value
|
|
On
balance sheet financial instruments:
|
|
|
|
|
|
|
|
|
|
|
|
|
In
$ US Functional
Currency
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
receivable in British
Pounds
|
|
|
1,321 |
|
|
|
- |
|
|
|
1,321 |
|
|
|
1,321 |
|
Accounts
receivable in
Euros
|
|
|
3,868 |
|
|
|
- |
|
|
|
3,868 |
|
|
|
3,868 |
|
Accounts
payable in British
Pounds
|
|
|
2,967 |
|
|
|
- |
|
|
|
2,967 |
|
|
|
2,967 |
|
Accounts
payable in
Euros
|
|
|
160 |
|
|
|
- |
|
|
|
160 |
|
|
|
160 |
|
Anticipated
Transactions and related derivatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In
$ US Functional
Currency
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Firmly
committed sales
contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In
British Pounds
|
|
|
1,033 |
|
|
|
- |
|
|
|
1,033 |
|
|
|
1,033 |
|
In
Euros
|
|
|
1,494 |
|
|
|
- |
|
|
|
1,494 |
|
|
|
1,494 |
|
Forward
exchange
agreements
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sell
US Dollars for British
Pounds
|
|
|
2,400 |
|
|
|
- |
|
|
|
2,400 |
|
|
|
2,400 |
|
Sell
Euros for British
Pounds
|
|
|
3,504 |
|
|
|
- |
|
|
|
3,504 |
|
|
|
3,504 |
|
Average
contractual exchange
rate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US
Dollars = British
Pound
|
|
|
2.01 |
|
|
|
- |
|
|
|
2.01 |
|
|
|
- |
|
Euro
= British
Pound
|
|
|
1.40 |
|
|
|
- |
|
|
|
1.40 |
|
|
|
- |
|
Amount
recorded as
other comprehensive income
|
|
$ |
54 |
|
|
$ |
- |
|
|
$ |
54 |
|
|
$ |
54 |
|
Interest
Rate Risk
The
Company does not currently have any
interest bearing debt. The Company does invest surplus funds in instruments
with
maturities of less than 12 months at both fixed and floating interest rates.
The
Company incurs short-term borrowings from time-to-time on its overdraft
facilities in Europe at variable interest rates. Due to the short-term nature
of
the Company’s investments at December 29, 2007, the risk arising from changes in
interest rates was not material.
(a)
Evaluation of disclosure controls and procedures. The Company’s principal
executive officer and principal financial officer, after evaluating the
effectiveness of the Company’s “disclosure controls and procedures” (as defined
in the Securities Exchange Act of 1934 Rule 13a-15(e)) have concluded that,
as
of December 29, 2007, these disclosure controls and procedures were
effective.
(b)
Changes in internal control over financial reporting. Our principal executive
officer and principal financial officer have identified no change in the
Company’s “internal control over financial reporting” (as defined in Securities
Exchange Act of 1934 Rule 13a-15(f)) that occurred during the period covered by
this Quarterly Report on Form 10-Q that has materially affected, or is
reasonably likely to materially affect, the Company’s internal control over
financial reporting.
None.
Item
1A
Risk Factors
In
addition to the market risk factors
relating to foreign currency and interest rate risk set out in PART 1 Item
3
above, the Company believes that the following represent the most significant
risk factors for the Company:
Capital
goods markets are cyclical
The
Company’s customers are mainly
manufacturers of capital goods such as fork lift trucks, aerial lifts and
railway signaling equipment. These markets are cyclical and are currently
showing modest growth, but demand in these markets could decrease or customers
could decide to purchase alternative products. In this event the Company’s sales
could decrease below its current break even point and there is no certainty
that
the Company would be able to decrease overhead expenses to enable it to operate
profitably.
Single
source materials and sub-contractors may not meet the Company’s
needs.
The
Company relies on certain suppliers
and sub-contractors for all of its requirements for certain components,
sub-assemblies and finished products. In the event that such suppliers and
sub-contractors are unable or unwilling to continue supplying the Company,
or to
meet the Company’s cost and quality targets or needs for timely delivery, there
is no certainty that the Company would be able to establish alternative sources
of supply in time to meet customer demand.
Damage
to the Company’s or sub-contractor’s buildings would hurt results.
In
the controller business the majority
of product is produced in a single plant in England and uses sub-assemblies
sourced from a sub-contractor with two plants in Poland. The capacitor business
is located in a single plant in Wales. In the event that any of these plants
was
to be damaged or destroyed, there is no certainty that the Company would be
able
to establish alternative facilities in time to meet customer demand. The Company
does carry property damage and business interruption insurance but this may
not
cover certain lost business due to the long-term nature of the relationships
with many customers.
Product
liability claims may have a material adverse effect
The
Company’s products are technically
complex and are installed and used by third parties. Defects in their design,
installation, use or manufacturing may result in product liability claims
against the Company. Such claims may result in significant damage awards, and
the cost of any such litigation could be material.
None.
None.
None.
None.
Item
6 Exhibits
See
Exhibit Index immediately preceding the exhibits.
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 thereunto
duly authorized.
|
TECH/OPS
SEVCON, INC
|
|
|
|
|
Date:
February 12, 2008
|
By:
/s/ Paul N. Farquhar
|
|
Paul
N. Farquhar
|
|
Chief
Financial Officer (Principal Financial Officer)
|
|
|
|
|
|
|
|
|
|
INDEX
OF
EXHIBITS
|
|
Exhibit
|
Description
|
|
|
31.1
|
Certification
of Principal Executive Officer pursuant to section 302 of the
Sarbanes-Oxley Act of 2002. Filed herewith.
|
|
|
31.2
|
Certification
of Principal Financial Officer pursuant to section 302 of the
Sarbanes-Oxley Act of 2002. Filed herewith.
|
|
|
32.1
|
Certification
of Principal Executive Officer and Principal Financial Officer pursuant
to
section 906 of the Sarbanes-Oxley Act of 2002. Furnished
herewith.
|