National Presto Industries Inc – ‘10-Q’ for 7/6/97

As of:  Wednesday, 8/13/97   ·   For:  7/6/97   ·   Accession #:  897101-97-910   ·   File #:  1-02451

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Quarterly Report   —   Form 10-Q
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        Quarterly Report                                      10     34K 
 2: EX-3.I      Restated Articles of Incorporation                     8     30K 
 3: EX-3.II     By-Laws                                               11     37K 
 4: EX-9        Voting Trust Agreement                                 6     21K 
 5: EX-10.1     1988 Stock Option Plan                                10     36K 
 6: EX-10.2     Incentive Stock Option Agreement                       4     16K 
 7: EX-11       Computation of Per Share Earnings                      1      6K 
 8: EX-27       Financial Data Schedule                                1      8K 

10-Q   —   Quarterly Report
Document Table of Contents

10-Q
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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  July 6, 1997

[   ]        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  1-2451                                                  

NATIONAL PRESTO INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)

WISCONSIN                                         39-0494170
(State or other jurisdiction of                          (I.R.S. Employer       
incorporation or organization)                           Identification No.)    

3925 NORTH HASTINGS WAY                                           
EAU CLAIRE, WISCONSIN                               54703-3703  
(Address of principal executive offices)                    (Zip Code)          

(Registrant's telephone number, including area code) 715-839-2121 

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_____                             

There were 7,354,291 shares of the Issuer's Common Stock outstanding as of the  
close of the period covered by this report.                                     

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NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES                               
CONSOLIDATED BALANCE SHEETS                                                     
July 6, 1997 and December 31, 1996                                              
(Unaudited)                                                                     
(Dollars in thousands)                                                          

                                                        [Enlarge/Download Table]

ASSETS                                                                                           
   CURRENT ASSETS:                                      1997                        1996         
-------------------------------------------------------------------------------------------------
                                                                                                 
       Cash and cash equivalents                             $ 76,678                    $ 91,878

       Marketable securities                                  143,776                     136,159

       Accounts receivable, net                                 8,128                      21,826

       Inventories:                                                                              
          Finished goods                       $ 10,713                    $  8,470              

          Work in process                         2,634                       1,744              

          Raw materials                           5,332                       6,661              

          Supplies                                1,096        19,775           945        17,820
                                               --------                    --------              
       Prepaid expenses                                           947                         888
                                                             --------                    --------
          Total current assets                                249,304                     268,571

   PROPERTY, PLANT AND EQUIPMENT:                18,943                      17,256              

          Less allowance for depreciation        10,857         8,086         9,911         7,345
                                               --------                    --------              
  OTHER ASSETS                                                 9,469                       9,469 
                                                             --------                    --------
                                                             $266,859                    $285,385
                                                             ========                    ========


The accompanying notes are an integral part of the financial statements.        

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NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES                               
CONSOLIDATED BALANCE SHEETS                                                     
July 6, 1997 and December 31, 1996                                              
(Unaudited)                                                                     
(Dollars in thousands)                                                          

                                                        [Enlarge/Download Table]

LIABILITIES                                                                                     
   CURRENT LIABILITIES:                              1997                         1996          
------------------------------------------------------------------------------------------------
                                                                                                
       Accounts payable                                    $  7,627                     $ 13,262

       Federal and state income taxes                         1,703                        4,887

       Accrued liabilities                                   20,123                       20,387
                                                           --------                     --------
          Total current liabilities                          29,453                       38,536

COMMITMENTS AND CONTINGENCIES                                  --                           --  

STOCKHOLDERS' EQUITY                                                                            

       Common stock, $1 par value:                                                              
          Authorized: 12,000,000 shares                                                         
          Issued: 7,440,518 shares           $  7,441                    $  7,441               

       Paid-in capital                            916                    $    903               

       Retained earnings                      231,327                    $240,815               
                                             --------                    --------               
                                              239,684                    $249,159               

       Treasury stock, at cost                  2,278                    $  2,310               
                                             --------                    --------               
             Total stockholders' equity                     237,406                      246,849
                                                           --------                     --------
                                                           $266,859                     $285,385
                                                           ========                     ========


The accompanying notes are an integral part of the financial statements.        

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NATIONAL PRESTO INDUSTRIES, INC.                                                
CONSOLIDATED STATEMENTS OF EARNINGS                                             
Three Months and Six Months ended July 6, 1997 and June 30, 1996                
(Unaudited)                                                                     
(In thousands except per share data)                                            

                                                        [Enlarge/Download Table]

                                                        THREE MONTHS ENDED       SIX MONTHS ENDED    
                                                      ----------------------  ---------------------- 
                                                        1997          1996      1997          1996   
                                                      --------      --------  --------      -------- 
                                                                                                     
Net sales                                             $ 16,870      $ 16,970  $ 34,817      $ 34,079 

Cost of sales                                           11,938        12,632    25,954        26,104 
                                                      --------      --------  --------      -------- 
      Gross profit                                       4,932         4,338     8,863         7,975 

Selling and general expenses                             4,199         3,880     8,431         8,154 
                                                      --------      --------  --------      -------- 
      Operating profit (loss)                              733           458       432          (179)

Other income, principally interest                       2,233         1,992     4,788         4,049 

Other, principally litgation judgments / settlements      --            --         550           476 

                                                      --------      --------  --------      -------- 
  Earnings before provision for income taxes             2,966         2,450     5,770         4,346 
Provision for income taxes                                 326           214       552           180 
                                                      --------      --------  --------      -------- 
    Net earnings                                      $  2,640      $  2,236  $  5,218      $  4,166 
                                                      ========      ========  ========      ======== 
Weighted average common and common                                                                   
    equivalent shares outstanding                        7,359         7,355     7,359         7,355 
                                                      ========      ========  ========      ======== 
Net earnings per common share                         $   0.36      $   0.31  $   0.71      $   0.57 
                                                      ========      ========  ========      ======== 
Cash dividends declared and paid per common share     $   --        $   --    $   2.00      $   2.00 
                                                      ========      ========  ========      ======== 


The accompanying notes are an integral part of the financial statements.        

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NATIONAL PRESTO INDUSTRIES, INC. AND SUBSIDIARIES                               
CONSOLIDATED STATEMENTS OF CASH FLOWS                                           
Six Months ended July 6, 1997 and June 30, 1996                                 
(Unaudited)                                                                     
(Dollars in thousands)                                                          

                                                                [Download Table]

                                                                1997      1996    
                                                              --------   -------- 
                                                                                  
Cash flows from operating activities:                                             

       Net earnings                                           $  5,218   $  4,166 

       Adjustments to reconcile net earnings to net cash                          
          provided by operating activities:                                       
          Provision for depreciation                               957        852 
          Stock compensation expense                                49         22 
          Changes in:                                                             
             Accounts receivable                                13,698     19,591 
             Inventories                                        (1,955)    (1,997)
             Prepaid expenses                                      (59)       646 
             Accounts payable and accrued liabilities           (5,899)    (6,829)
             Federal and state income taxes                     (3,184)    (4,671)
                                                              --------   -------- 
                   Net cash provided by operating activities     8,825     11,780 
                                                              --------   -------- 
Cash flows from investing activities:                                             

       Marketable securities purchased                         (29,861)   (42,414)
       Marketable securities - maturities and sales             22,244     41,459 
       Acquisition of property, plant and equipment             (1,700)    (1,964)
       Other                                                         2          7 
                                                              --------   -------- 
                   Net cash used in investing activities        (9,315)    (2,912)
                                                              --------   -------- 
Cash flows from financing activities:                                             

       Dividends paid                                          (14,706)   (14,701)
       Other                                                        (4)        39 
                                                              --------   -------- 
                   Net cash used in financing activities       (14,710)   (14,662)
                                                              --------   -------- 
Net decrease in cash and cash equivalents                      (15,200)    (5,794)
Cash and cash equivalents at beginning of period                91,878     91,448 
                                                              --------   -------- 
Cash and cash equivalents at end of period                    $ 76,678     85,654 
                                                              ========   ======== 


The accompanying notes are an integral part of the financial statements.        

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NATIONAL PRESTO INDUSTRIES, INC., AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A - EARNINGS PER SHARE                                                     

Earnings per share are computed using the weighted average common shares        
outstanding during each period.                                                 

NOTE B - NEW ACCOUNTING PRONOUNCEMENT                                           

The FASB has issued Statement of Financial Accounting Standards No. 128,        
EARNINGS PER SHARE, which is effective for financial statements issued after    
December 15, 1997. Early adoption of the new standard is not permitted. The new 
standard eliminates primary and fully diluted earnings per share and requires   
presentation of basic and diluted earnings per share together with disclosure of
how the per share amounts were computed. The adoption of this new standard is   
not expected to have a material impact on the disclosure of earnings per share  
in the financial statements.                                                    

------------------------------------------------------------------------        

The foregoing information for the periods ended July 6, 1997, and June 30, 1996,
is unaudited; however, in the opinion of management of the Registrant, it       
reflects all the adjustments, which were of a normal recurring nature, necessary
for a fair statement of the results for the interim periods. The condensed      
consolidated balance sheet as of December 31, 1996, is summarized from audited  
consolidated financial statements, but does not include all the disclosures     
contained therein and should be read in conjunction with the 1996 Annual Report.
Interim results for the period are not indicative of those for the year.        

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL                               
CONDITION AND RESULTS OF OPERATIONS                                             

Comparison Second Quarter 1997 and 1996                                         

Net sales decreased $100,000 from $16,970,000 to $16,870,000. 

   Gross margins as a percentage of sales increased from 26% to 29%,
primarily as a result of more favorable manufacturing variances.                

        The Company accrues unexpended advertising costs budgeted for the year
against each quarter's sales. Major advertising commitments are incurred in     
advance of the expenditures, and the timing of sales through dealers and        
distributors to the ultimate customer does not permit specific identification of
the customers' purchase to the actual time an advertisement appears. Advertising
charges included in selling expense in each quarter represent that percentage of
the annual advertising budget associated with that quarter's shipments.         
Revisions to this budget result in periodic changes to the accrued liability for
committed advertising expenditures.                                             

         Both other income, principally interest and net earnings increased from
the 1996 level primarily as a result of a higher rate of return on a higher     
level of invested funds.                                                        

    Earnings before provision for income taxes increased $516,000 from
$2,450,000 to $2,966,000. The provision for income taxes increased from $214,000
to $326,000 and the effective income tax rate increased from 9% to 11%, as a    
result of increased earnings subject to tax. Net earnings increased $404,000    
from $2,236,000 to $2,640,000, or 18%.                                          

     The Company maintains adequate liquidity for all of its anticipated
capital requirements. As of quarter-end, there were no material capital         
commitments outstanding.                                                        

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Comparison of the First Six Months 1997 and 1996                                

  Net sales increased by $738,000 from $34,079,000 to $34,817,000,
primarily due to a higher volume.                                               

   Gross margins as a percentage of sales increased from 23% to 26%,
primarily as a result of more favorable manufacturing variances offset in part  
by a less favorable product mix.                                                

      The accrual for unexpended advertising costs discussed in the Second
Quarter comparison also applies to the first six months.                        

         Both other income, principally interest and net earnings increased from
the 1996 level primarily as a result of a higher rate of return on a higher     
level of invested funds.                                                        

Both years were favorably impacted by litigation judgments /  
settlements of a non-recurring nature.                                          

      Earnings before provision for income taxes increased $1,424,000 from
$4,346,000 to $5,770,000. The provision for income taxes increased from $180,000
to $552,000 and the effective income tax rate increased from 4% to 10%, as a    
result of increased earnings subject to tax. Net earnings increased $1,052,000  
from $4,166,000 to $5,218,000, or 25%.                                          

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 PART II - OTHER INFORMATION

Item 4.  Submission of matters to a vote of security holders                    

         On May 20, 1997, the Registrant held its Annual Meeting of Stockholders
     at which time the nominees proposed by the Board were re-elected to
     three year terms. The results of the vote on the Board of Directors
election was as follows:                                      

                                                   Against       Abstentions
                                                     or         and Broker
        Nominee                     For          Withheld      non-votes
        -------                     ---          --------      ---------
   Melvin S. Cohen             6,374,533        57,304        76,670
   MaryJo Cohen                6,412,283        18,754        76,670

Item 6.  Exhibits and Reports on Form 8-K                                       

(a)   Exhibits:                                               
     Exhibit 3 (i) -  Restated Articles of Incorporation
(ii) -  By-Laws             
Exhibit 9     -  Voting Trust Agreement       
Exhibit 10.1  -  1988 Stock Option Plan       
                 Exhibit 10.2  -  Form of Incentive Stock Option Agreement under
              1988 Stock Option Plan
                 Exhibit 11    -  Statement Re computation of per share earnings
Exhibit 27    -  Financial Data Schedule      

(b) Reports on Form 8-K:                                      

None                                          

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 thereunto duly authorized.                                          

                                          NATIONAL PRESTO INDUSTRIES, INC.

Date:  August 8, 1997                        /S/ M. J. COHEN                    
                                M. J. Cohen, President
                                       (Principal operating officer)

Date:  August 8, 1997                        /S/ R. F. LIEBLE                   
                                 R. F. Lieble, Treasurer
                                        (Principal accounting officer)

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Exhibit                                                           
Number         Exhibit Description                                
------         -------------------                                

+      3 (i)          Restated Articles of Incorporation                        

+      3 (ii)         By-Laws                                                   

+      9              Voting Trust Agreement                                    

+      10.1     *     1988 Stock Option Plan                                    

+      10.2     *     Form of Incentive Stock Option Agreement under            
1988 Stock Option Plan    

+      11             Statement Re computation of per share earnings            

+      27             Financial Data Schedule                                   

+              Filed with this report                             

    *              Management contract or compensatory plan or arrangement
                      required to be filed as an exhibit pursuant to Item 14 (C)
of Form 10-K                        

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘10-Q’ Filing		Date		First		Last			Other Filings
		12/15/97		6
		8/19/97
Filed on:		8/13/97
		8/8/97		9
For Period End:		7/6/97		1		6
		5/20/97		9
		12/31/96		2		6			10-K405,  DEF 14A
		6/30/96		4		6			10-Q
									List all Filings

15 Subsequent Filings that Reference this Filing

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 3/15/24  National Presto Industries Inc.   10-K       12/31/23   92:7.6M                                   RDG Filings/FA
11/13/23  National Presto Industries Inc.   10-Q       10/01/23   54:3.7M                                   RDG Filings/FA
 8/11/23  National Presto Industries Inc.   10-Q        7/02/23   55:3.7M                                   RDG Filings/FA
 5/12/23  National Presto Industries Inc.   10-Q        4/02/23   53:3.3M                                   RDG Filings/FA
 3/13/23  National Presto Industries Inc.   10-K       12/31/22   92:7.5M                                   RDG Filings/FA
11/14/22  National Presto Industries Inc.   10-Q       10/02/22   54:3.6M                                   RDG Filings/FA
 8/12/22  National Presto Industries Inc.   10-Q        7/03/22   49:3.1M                                   RDG Filings/FA
 5/13/22  National Presto Industries Inc.   10-Q        4/03/22   47:2.7M                                   RDG Filings/FA
 3/11/22  National Presto Industries Inc.   10-K       12/31/21   93:7.2M                                   RDG Filings/FA
11/12/21  National Presto Industries Inc.   10-Q       10/03/21   47:3.1M                                   RDG Filings/FA
 8/13/21  National Presto Industries Inc.   10-Q        7/04/21   53:3.4M                                   RDG Filings/FA
 5/14/21  National Presto Industries Inc.   10-Q        4/04/21   47:2.7M                                   RDG Filings/FA
 3/16/21  National Presto Industries Inc.   10-K       12/31/20   95:7.8M                                   RDG Filings/FA
11/06/20  National Presto Industries Inc.   10-Q        9/27/20   54:3.8M                                   RDG Filings/FA
 8/07/20  National Presto Industries Inc.   10-Q        6/28/20   52:3.6M                                   RDG Filings/FA