SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
Quarterly report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended April 30, 1998
Transition report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from _________ to
_________.
Commission File No. 0-9143
HURCO COMPANIES, INC.
(Exact name of registrant as specified in its charter)
Indiana 35-1150732
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
One Technology Way
Indianapolis, Indiana 46268
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (317) 293-5309
--------------
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months, and (2) has been subject to the filing
requirements for the past 90 days:
Yes X No
The number of shares of the Registrant's common stock outstanding as of June 10,
1998 was 6,456,011.
HURCO COMPANIES, INC.
April 1998 Form 10-Q Quarterly Report
Table of Contents
Part I - Financial Information
Page
Item 1. Condensed Financial Statements
Condensed Consolidated Statement of Operations -
Three months and six months ended
April 30, 1998 and 1997...................................3
Condensed Consolidated Balance Sheet -
As of April 30, 1998 and October 31, 1997................4
Condensed Consolidated Statement of Cash Flows -
Three months and six months ended April 30, 1998 and 1997.5
Notes to Condensed Consolidated Financial Statements..........6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations...........................7
Part II - Other Information
Item 1. Legal Proceedings............................................12
Item 6. Exhibits and Reports on Form 8-K.............................13
Signature..................................................................13
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
HURCO COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per-share data)
Three Months Ended Six Months Ended
April 30, April 30,
------------------ ----------------
1998 1997 1998 1997
- --------------------------------------------------------------------------------
(unaudited) (unaudited)
Sales and service fees....... $21,542 $22,581 $43,662 $44,859
Cost of sales and service.... 15,256 15,720 31,252 31,530
---------- ----------- ----------- ---------
Gross profit............ 6,286 6,861 12,410 13,329
Selling, general and
administrative expenses...... 5,354 5,217 10,378 10,263
---------- ----------- ----------- ---------
Operating income ....... 932 1,644 2,032 3,066
License fee income and litigation
settlement fees, net......... 4,291 6,032 5,785 6,175
Interest expense............. 210 538 484 1,060
Other expense, net........... 47 41 25 50
---------- ----------- ----------- ---------
Income before taxes..... 4,966 7,097 7,308 8,131
Provision for foreign income
taxes 696 896 852 914
---------- ----------- ----------- ---------
Net income.................. $4,270 $6,201 $6,456 $7,217
=========== =========== =========== ==========
Earnings per common share
Basic.................. $.65 $.95 $.98 $1.10
========== =========== ========== =========
Diluted................ $.63 $.93 $.96 $1.08
========== =========== ========== =========
Weighted average common
shares outstanding
Basic.................. 6,560 6,534 6,557 6,534
========== ========== ========= =========
Diluted................ 6,764 6,659 6,751 6,669
========== ========== ========= =========
The accompanying notes are an integral part of the consolidated financial
statements.
HURCO COMPANIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
(Dollars in thousands)
April 30, October 31,
1998 1997
ASSETS (Unaudited) (Audited)
Current assets:
Cash and temporary investments...............$ 7,922 $ 3,371
Accounts receivable.......................... 14,450 15,687
Inventories.................................. 22,464 21,752
Other........................................ 1,961 1,412
---------- ---------
Total current assets..................... 46,797 42,222
---------- ---------
Long-term license fees receivable................. 1,010 1,178
---------- ---------
Property and equipment:
Land ..................................... 761 761
Building..................................... 7,067 7,067
Machinery and equipment...................... 11,166 11,463
Leasehold improvements....................... 1,181 1,121
Less accumulated depreciation and
amortization.................. (10,988) (11,218)
---------- ----------
9,187 9,194
---------- ---------
Software development costs, net of amortization... 4,285 4,447
Other assets ..................................... 2,149 1,707
--------------- -------------
$ 63,428 $ 58,748
========== =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable.............................$ 12,099 $ 9,246
Accrued expenses............................. 7,817 8,338
Current portion of long-term debt............ 1,786 1,786
---------- ---------
Total current liabilities................ 21,702 19,370
---------- ---------
Non-current liabilities
Long-term debt............................... 4,572 8,257
Deferred credits and other obligations....... 1,357 1,345
---------- ---------
Total non-current liabilities......... 5,929 9,602
---------- ---------
Shareholders' equity:
Preferred stock: no par value per share;
1,000,000 shares authorized; no shares
issued............................... -- --
Common stock: no par value; $.10 stated
value per share; 12,500,000 shares
authorized; and 6,545,011 and
6,544,831 shares issued and outstanding,
respectively .......... 658 654
Additional paid-in capital................... 50,149 50,349
Accumulated deficit.......................... (9,948) (16,404)
Foreign currency translation adjustment...... (5,062) (4,823)
---------- ---------
Total shareholders' equity............... 35,797 29,776
---------- ---------
$63,428 $58,748
========== =========
The accompanying notes are an integral part of the condensed
consolidated financial statements.
HURCO COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollars in thousands)
Three Months Ended Six Months Ended
April 30, April 30,
-----------------------------------
1998 1997 1998 1997
- --------------------------------------------------------------------------------
(unaudited) (unaudited)
Cash flows from operating activities:
Net income ............................ $4,270 $6,201 $6,456 $7,217
Adjustments to reconcile net income to net
cash provided by (used for) operating activities:
Depreciation and amortization........ 550 382 1,072 931
Change in assets and liabilities:
(Increase) decrease in accounts
receivable............... 2,550 (495) 1,100 1,521
(Increase) decrease in license fee
receivables........... 495 18 (340) 15
(Increase) decrease in inventories.... (2,763) (971) (861) (3,627)
Increase (decrease) in accounts payable 3,326 (927) 2,883 (1,044)
Increase (decrease) in accrued expenses 863 (48) (430) (1,283)
Other................................. (324) 499 (361) 546
---------- -------- ------- ------
Net cash provided by (used for)
operating activities................ 8,967 4,659 9,519 4,276
---------- --------- ------- ------
Cash flows from investing activities:
Proceeds from sale of equipment......... 8 7 10 83
Purchase of property and equipment...... (347) (23) (539) (249)
Software development costs.............. (217) (353) (380) (727)
Other investments....................... (57) (418) (196) (418)
---------- --------- ------- ------
Net cash provided by (used for)
investing activities.................. (613) (787) (1,105) (1,311)
---------- --------- ------- ------
Cash flows from financing activities:
Advances on bank credit facilities...... 2,500 9,129 8,500 18,057
Repayment on bank credit facilities .... (5,108) (13,063) (10,400)(19,790)
Repayment of term debt ................. -- -- (1,786) (1,786)
Proceeds from exercise of common stock
options............. 48 8 82 8
Purchase of common stock................ (278) -- (278) --
---------- --------- ------- ------
Net cash provided by (used for)
financing activities.................. (2,838) (3,926) (3,882) (3,511)
--------- --------- ------- ------
Effect of exchange rate changes on cash.... (75) (46) 19 (193)
--------- --------- ------- ------
Net increase (decrease) in cash and
temporary investments................. 5,441 (100) 4,551 (739)
Cash and temporary investments
at beginning of period................ 2,481 1,238 3,371 1,877
---------- --------- ------- ------
Cash and temporary investments
at end of period......................$ 7,922 $ 1,138 $ 7,922 $ 1,138
========= ======== ======== =======
The accompanying notes are an integral part of the consolidated financial
statements.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. GENERAL
The unaudited Condensed Consolidated Financial Statements include the accounts
of Hurco Companies, Inc. and its consolidated subsidiaries (collectively the
Company). The Company is an industrial automation company that designs and
produces interactive computer controls, software and computerized machine
systems for the worldwide metal cutting and metal forming industries.
The condensed financial information as of April 30, 1998 and 1997 is unaudited
but includes all adjustments which the Company considers necessary for a fair
presentation of financial position at those dates and its results of operations
and cash flows for the three months and six months then ended. It is suggested
that those condensed financial statements be read in conjunction with the
financial statements and the notes thereto included in the Company's Annual
Report on Form 10-K for the year ended October 31, 1997.
2. LICENSE FEE INCOME AND LITIGATION SETTLEMENT FEES, NET
From time to time, the Company's wholly-owned subsidiary, IMS Technology, Inc.
(IMS) enters into agreements for the licensing of its interactive computer
numerical control (CNC) patents. License fees received or receivable under a
fully paid-up license, for which there are no future performance requirements or
contingencies, and payments received or receivable to settle litigation related
to the patents, are recognized in income, net of legal fees and expenses, if
any, at the time the license agreement is executed. License fees received in
periodic installments that are contingent upon the continuing validity of a
licensed patent are recognized in income, net of legal fees and expenses, if
any, over the life of the licensed patent.
During the second quarter ended April 30, 1998, IMS entered into license
agreements and litigation settlements with a number of manufacturers and
end-users of interactive CNCs, including machine tool manufacturers who
incorporate interactive CNCs in their products, some of which were defendants in
patent infringement actions brought by IMS. These agreements resulted in the
recognition of license fee and litigation settlement fee income of approximately
$3.7 million, net of expenses and foreign withholding taxes, all of which was
received in the second quarter.
3. PROVISION FOR FOREIGN INCOME TAXES
The provision for foreign income taxes includes $576,000 which represents
foreign withholding tax on payments received in the second fiscal quarter of
1998 for license fees and litigation settlements. The remainder of the expense
is income tax related to a foreign subsidiary.
4. HEDGING
The Company seeks to hedge its exposure to fluctuations in foreign currency
exchange rates through the use of foreign currency forward exchange contracts.
The U.S. dollar equivalent notional amount of outstanding foreign currency
forward exchange contracts was approximately $16.0 million as of April 30, 1998
(substantially all related to firm intercompany sales commitments) and $19.0
million as of October 31, 1997 ($17.8 million related to firm intercompany sales
commitments). Deferred losses related to hedges of future sales transactions
were approximately $21,000 as of April 30, 1998, compared to deferred losses of
$408,000 as of October 31, 1997. Contracts outstanding at April 30, 1998 mature
at various times through October 9, 1998. All contracts are for the sale of
currency. The Company does not enter into these contracts for trading purposes.
5. EARNINGS PER SHARE
Basic and diluted earnings per common share are based on the weighted average
number of common shares outstanding. Diluted earnings per common share give
effect to outstanding stock options using the treasury method. Common stock
equivalents totaled approximately 200,000 shares as of April 30, 1998.
6. ACCOUNTS RECEIVABLE
The allowance for doubtful accounts was $799,000 as of April 30, 1998 and
$757,000 as of October 31, 1997.
7. INVENTORIES
Inventories, priced at the lower of cost (first-in, first-out method) or market
are summarized below (in thousands):
April 30, 1998 October 31, 1997
-------------- ----------------
Purchased parts and sub-assemblies $ 11,033 $ 9,749
Work-in-process 1,618 1,578
Finished goods 9,813 10,425
---------- --------
$ 22,464 $ 21,752
========= ========
8. TAX CONTINGENCY
The German tax authority is challenging the Company's 1996 transfer of net
operating losses between two German subsidiaries of the Company that merged in
fiscal 1996. The contingent tax liability resulting from this issue is
approximately $1.4 million. The Company is contesting the claim and, as of April
30, 1998, no provision for the contingency has been recorded.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion should be read in conjunction with the Condensed
Consolidated Financial Statements and Notes thereto appearing elsewhere herein.
Certain statements made in this report relating to trends in the Company's
operations or financial results, as well as other statements, including words
such as "anticipate", "believe", "plan", "estimate", "expect", "intend", and
other similar expressions, constitute forward-looking statements under the
Private Securities Litigation Reform Act of 1995. These forward-looking
statements are subject to known and unknown risks, uncertainties and other
factors which could cause actual results to be materially different from those
contemplated by the forward-looking statements, including those risks,
uncertainties and other factors described in the Company's annual report on Form
10-K for the year ended October 31, 1997.
RESULTS OF OPERATIONS
Three Months Ended April 30, 1998 Compared to Three Months Ended April 30, 1997
Sales and service fees for the second quarter of fiscal 1998 were approximately
$1.0 million, or 4.6%, below the amount recorded during the second quarter of
fiscal 1997. Of the total decrease, approximately $550,000, or 2.4%, was the
result of the effects of a stronger U.S. dollar when translating foreign sales
for financial reporting purposes. Sales of computerized machine systems
decreased $576,000, or 4.1%, from the second quarter of fiscal 1997, primarily
due to the effects of the stronger U.S. dollar, but did not change significantly
from the second quarter of fiscal 1997 when measured at constant exchange rates.
Sales of computerized machine systems were adversely affected by a temporary
reduction in availability of finished machine systems for shipment, which has
since been resolved and is expected to contribute to higher shipments in the
third quarter. Sales of stand-alone computer numerical control (CNC) systems,
consisting primarily of the Autobend(R) and Delta(TM) series products, declined
approximately $441,000, or 10.2%, reflecting reduced demand from original
equipment manufacturers (OEM) and the Company's repositioning of these products
for inclusion as fully-integrated components of computerized machine systems.
The decrease in sales of CNC systems was partially offset by an increase in
software sales. Sales of service parts and service fees decreased by
approximately $200,000, or 6.0 %, compared to the second quarter of fiscal 1997,
due principally to improvements in the durability of the Company's products, as
well as the transfer to the Company's U.S. distributors of responsibility for
certain service activities.
Compensating for the decline in sales was a substantial increase in new order
bookings to $26.2 million, compared with $22.9 million for the corresponding
1997 period. Orders for computerized machine systems increased 30%, both in
units and in constant dollar terms. The increase was most pronounced in the U.S.
market, which posted a 54% increase in unit orders on the strength of demand for
the Company's recently-introduced milling machine models, along with demand for
the Company's computerized machining centers. European unit orders for
computerized machine systems increased approximately 11% over the comparable
quarter of fiscal 1997. The increase in computerized machine system orders was
partially offset by a reduction in orders for stand-alone CNC systems, which
paralleled the decline in shipments. The increase in new order bookings,
combined with the temporary second-quarter delay in shipments of finished
products, has resulted in an increase in the Company's backlog to $12.5 million
at April 30, 1998 compared to $7.6 million at January 31, 1998 and $7.5 million
at the end of fiscal 1997.
As a percentage of sales, gross profit for the second quarter of fiscal 1998
decreased to 29.2% compared to 30.4% for the corresponding period in fiscal
1997. The reduction was primarily attributable to reduced sales of stand-alone
CNC systems, which historically have been associated with higher margins.
Interest expense for the second quarter of fiscal 1998 decreased approximately
$328,000, or 61%, from the amount reported for the corresponding 1997 period
primarily due to a reduction in outstanding borrowings to $6.4 million at April
30, 1998 compared to $18.5 million one year earlier.
License fee income and payments received in settlement of litigation from
certain alleged infringers of IMS' interactive machining patents aggregated
$4.3 million, net of expenses, during the second quarter of fiscal 1998, a
decrease of nearly 29% from the $6.0 million recorded during the
corresponding period in fiscal 1997. Such fees, after deducting foreign
withholding taxes, were approximately $3.7 million during the second
quarter of fiscal 1998 compared to approximately $5.1 million in the prior
year period. The decrease reflected the fact that license fees were
unusually high in the second quarter of fiscal 1997. Management believes that
IMS has now granted fully-paid licenses to most of the manufacturers who IMS
alleged were employing its patented technology. Accordingly, although IMS
intends to actively enforce and license its patent rights, management believes
that it is unlikely that aggregate license fee income for the balance of fiscal
1998 will equal the amounts recorded in the second half of fiscal 1997.
The provision for foreign income taxes was the result of foreign withholding
taxes of $576,000 related to the license fee payments and litigation
settlements, while the remainder was related to the earnings of a foreign
subsidiary.
Six Months Ended April 30, 1998 Compared to Six Months Ended April 30, 1997
Sales and service fees for the first half of fiscal 1998 were slightly higher
than those recorded in the 1997 period before the effect of foreign currency
rate changes when converting foreign revenues into U.S. dollars for financial
reporting purposes. However, as a result of a strengthened U.S. dollar, sales
and service fees after such conversion declined approximately $1.2 million, or
2.7%, from the amount reported during the first half of fiscal 1997. Sales of
computerized machine systems increased $1.2 million, or 4.2%, after currency
translation effects, as a result of strong demand, primarily in Germany, for the
Company's new line of 30-inch and 40-inch machining systems that incorporated
its Ultimax(R) interactive control software. Sales of computerized machining
systems increased $2.5 million, or 8.9%, when measured at constant exchange
rates. Sales of stand-alone CNC systems declined approximately $1.8 million, or
20.1% from the 1997 first half level, reflecting reduced OEM demand and the
Company's repositioning of these products for inclusion as fully-integrated
components of computerized machine systems. Sales of service parts and service
fees decreased by $551,000, or 7.7% compared to the first half of fiscal 1997,
due principally to improvements in the durability of the Company's products as
well as the transfer to the Company's U.S. distributors of responsibility for
certain service activities.
New order bookings were $48.3 million, an increase of 9.2% from the $44.2
million reported for the first half of fiscal 1997, after currency translation
effects. When measured at constant exchange rates, however, new orders were
approximately 11.4% above the fiscal 1997 level. Orders for computerized machine
systems, at constant exchange rates, increased approximately 29% over the first
half of fiscal 1997. Orders for stand-alone CNC systems, which were not
significantly affected by currency translation, declined by 23%, paralleling the
decline in shipments of these products.
As a percentage of sales, gross profit decreased to 28.4% compared to 29.7% for
the first half of fiscal 1997. The reduction was primarily attributable to
reduced sales of stand-alone CNC systems and sales of service parts, both of
which historically have been associated with higher margins.
License fee income and payments received in settlement of litigation from
certain alleged infringers of IMS' interactive machining patents aggregated $5.8
million, net of expenses, during the first half of fiscal 1998, slightly below
the $6.2 million recorded during the corresponding period in fiscal 1997. Such
payments, after deducting foreign withholding taxes, were approximately $5.1
million during the first half of fiscal 1998 compared to approximately $5.3
million in the prior year period.
Interest expense for the first half of fiscal 1998 decreased approximately
$576,000, or 54%, from the amount reported for the corresponding 1997 period
primarily due to a substantial reduction in outstanding borrowings to $6.4
million at April 30, 1998 compared to $18.5 million one year earlier.
The provision for foreign income taxes was the result of foreign withholding
taxes of $648,000 related to payments of license fees and litigation
settlements, while the remainder was related to the earnings of a foreign
subsidiary.
Foreign Currency Risk Management
The Company seeks to manage its foreign currency exposure through the use of
foreign currency forward exchange contracts. The Company does not speculate in
the financial markets and, therefore, does not enter into these contracts for
trading purposes. The Company also endeavors to moderate its currency risk
related to significant purchase commitments with certain foreign vendors through
price adjustment agreements that provide for a sharing of, or otherwise limit,
the potential adverse effect of currency fluctuations on the costs of purchased
products. The results of these programs achieved management's objectives for the
first half of fiscal 1998. See Note 4 to the Condensed Consolidated Financial
Statements.
LIQUIDITY AND CAPITAL RESOURCES
At April 30, 1998, the Company had cash and temporary investments of $7.9
million compared to $3.4 million at October 31, 1997. Cash provided by
operations totaled approximately $9.0 million in the second quarter of fiscal
1998, compared to $4.7 million for the same period of fiscal 1997. Cash flow
from operations included approximately $4.9 million of license fees and
litigation settlements received, net of expenses paid and foreign taxes withheld
during the 1998 second quarter.
For the six months ended April 30, 1998, cash provided by operations was $9.5
million, of which $5.5 million was attributable to license fees and settlements
of litigation received, net of expenses paid and foreign taxes withheld.
Working capital was $25.1 million at April 30, 1998, compared to $22.9 million
at October 31, 1997. The increase was attributable primarily to the increase in
cash and temporary investments of $4.5 million for the first six months of
fiscal 1998, offset by a $2.9 million increase in payables. The increase in
payables is the result of increased inventory purchases during the latter part
of the second fiscal quarter. The ratio of current assets to current liabilities
was 2.2 to 1 at April 30, 1998 and 2.2 to 1 at October 31, 1997.
Capital investments for the quarter and six months ended April 30, 1997
consisted principally of expenditures for software development projects and
purchases of equipment. Cash used for investing activities during the quarter
and year to date were funded by cash flow from operations.
Outstanding borrowings under the Company's existing credit facilities were
reduced by $2.6 million during the second quarter of fiscal 1998, primarily as a
result of payments made with cash flow from operations. As of April 30, 1998,
the Company had unutilized availability of $12.9 million under its credit
facilities. The Company was in compliance with all loan covenants at April 30,
1998.
Management believes that anticipated cash flow from operations and available
borrowings under the credit facilities will be sufficient to meet its
anticipated cash requirements in the foreseeable future.
PART II - OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
As previously reported, the Company and its wholly-owned subsidiary, IMS
Technology, Inc. (IMS) are parties to a number of pending legal actions
involving the IMS interactive machining patent (the Patent), including patent
infringement actions and actions brought by third parties against IMS and the
Company relating to the Patent.
Two previously reported actions pending in the United States District Court for
the Northern District of Illinois and one previously reported action pending in
the United States District Court for the Eastern District of Virginia, in which
Mitsubishi Electric Corporation and Mitsubishi Electric Industrial Controls
(collectively, Mitsubishi) and certain customers of Mitsubishi were parties,
were dismissed during the second fiscal quarter as a result of a settlement
agreement reached among the parties.
On March 26, 1998, IMS commenced an action against Centroid Corporation
(Centroid), Brother International Corp. (Brother), MTI Corporation (MTI) and
Control Techniques Drives, Inc. (Control) in the United States District Court
for the Eastern District of Virginia. The actions seeks monetary damages and an
injunction against future infringement of the Patent. During the second fiscal
quarter, Brother and MTI entered into license agreements with IMS providing for
payment of lump-sum cash amounts to IMS and the claims against Brother and MTI
in the action were dismissed. Claims against Centroid and Control are still
pending.
On May 6, 1998, Centroid commenced a separate action against IMS, the Company,
three officers of IMS and patent counsel for IMS in the United States District
Court of the Middle District of Pennsylvania. The complaint makes numerous
allegations regarding the defendants' actions in obtaining and enforcing the
Patent, including allegations of fraud, violations of the Racketeer Influenced
and Corrupt Organization Act and the Lanham Act, allegations of
misrepresentations made to Centroid's customers and interference with
prospective business relationships. The complaint seeks monetary damages,
trebled pursuant to law, interest, costs of suit and an injunction against
enforcement of the Patent. Based upon the information available, and after
consultation with counsel, management believes that the claims brought by
Centroid are without merit and intends to vigorously defend them and to pursue
patent infringement claims against Centroid.
All of the pending actions described above are in the early stages and
management is unable to predict the outcome of any of these actions.
The Company is involved in various other claims and lawsuits arising in the
ordinary course of business, none of which, in the opinion of management, is
expected to have a material adverse effect on its consolidated financing
position or results of operations.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
11 Statement re: Computation of Per Share Earnings
27 Financial Data Schedule (electronic filing only).
(b) Reports on Form 8-K: None
SIGNATURE
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.
HURCO COMPANIES, INC.
By: /s/ Roger J. Wolf
Roger J. Wolf
Senior Vice President and
Chief Financial Officer
By: /s/ Stephen J. Alesia
Stephen J. Alesia
Corporate Controller and
Principal Accounting Officer
June 12, 1998
EXHIBIT 11
STATEMENT RE: COMPUTATION OF PER SHARE EARNINGS
THREE MONTHS ENDED SIX MONTHS ENDED
APRIL 30, APRIL 30,
------------------ ------------------
1998 1997 1998 1997
---- ---- ---- ----
Basic Fully Basic Fully Basic Fully Basic Fully
Diluted Diluted Diluted Diluted
(in thousands except per share amount)
Net Income....... 4,270 4,270 6,201 6,201 6,456 6,456 7,217 7,217
Weighted Average
Shares
Outstanding..... 6,560 6,560 6,534 6,534 6,557 6,557 6,534 6,534
Assumed Issuances
Under stock
Option Plans.... 204 125 194 135
----- ----- ----- ----- ----- ----- ----- -----
6,560 6,764 6,534 6,659 6,557 6,751 6,534 6,669
----- ----- ----- ----- ----- ----- ----- -----
Earnings per
common share.... $.65 $.63 $.95 $.93 $.98 $.96 $1.10 $1.08
===== ===== ===== ===== ===== ===== ===== =====
5
0000315374
SONJA BUCKLES
1,000
US DOLLARS
6-MOS
OCT-31-1998
NOV-1-1997
APR-30-1998
1
7,922
0
15,249
799
22,464
46,797
20,175
10,998
63,428
21,702
0
0
0
658
35,139
63,428
43,662
43,662
31,252
31,252
5,760
0
484
7,308
852
852
0
0
0
6,456
.98
.96
