UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM
8-K
CURRENT
REPORT PURSUANT
TO
SECTION 13 OR 15(D) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of
report (Date of earliest event reported) March 11, 2010
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Hurco
Companies, Inc.
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(Exact
Name of Registrant as Specified in Its Charter
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Indiana
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(State
or Other Jurisdiction of
Incorporation
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0-9143
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35-1150732
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(Commission
File Number)
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(I.R.S.
Employer Identification Number)
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One
Technology Way
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Indianapolis,
Indiana
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46268
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(Address
of principal executive offices)
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(Zip
code)
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(317)
293-5309
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(Registrant’s
Telephone Number, Including Area Code
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Not
Applicable
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(Former
Name or Former Address, if Changed Since Last
Report)
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Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (see General Instruction A.2.
below):
¨ Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
¨ Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
¨ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
¨ Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
2.02.
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Results
of Operation and Financial
Condition
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On March 11, 2010, Hurco Companies,
Inc. (the "Registrant") reported its results of operations for the first quarter
ended January 31, 2010. The Registrant's earnings release for the
period is attached as Exhibit 99 and the information set forth therein is
incorporated herein by reference and constitutes a part of this
report. The attached Exhibit is furnished pursuant to Item 2.02
of Form 8-K.
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Item
9.01
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Financial
Statements and Exhibits.
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99
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Press
Release dated March 11, 2010
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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 hereunto duly
authorized.
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Dated: March
11, 2010
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HURCO
COMPANIES, INC
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By:
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/s/John G. Oblazney
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John
G. Oblazney,
Vice
President and
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Chief
Financial Officer
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EXHIBIT
INDEX
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Exhibit
99
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Press
Release of Hurco Companies, Inc. dated March 11,
2010
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FOR
IMMEDIATE RELEASE
THURSDAY,
MARCH 11, 2010
HURCO
REPORTS FIRST QUARTER RESULTS
INDIANAPOLIS, INDIANA, — March 11,
2010, Hurco Companies, Inc., (Nasdaq, Global Select Market: HURC) today
reported for its first quarter ended January 31, 2010, a net loss of $1,836,000,
or $(0.29) per diluted share, as compared to net income of $354,000, or $0.05
per diluted share, for the first quarter of fiscal 2009.
Sales and
service fees for the first quarter of fiscal 2010 totaled $20,616,000, a
decrease of $7,691,000, or 27%, from the first quarter of fiscal
2009. The effect of a weaker U.S. dollar when translating foreign
sales to U.S. dollars for financial reporting purposes had a favorable impact of
approximately 5%, or $1,291,000, on the period-to-period
comparison.
The
following table sets forth net sales and service fees by geographic region for
the first quarter of fiscal 2010 and 2009 (in thousands):
Net Sales
and Service Fees by Geographic Region
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Three Months Ended
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||||||||||||
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January 31,
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||||||||||||
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%
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||||||||||||
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2010
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2009
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Change
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||||||||||
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North
America
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$ | 6,101 | $ | 9,636 | -37 | % | ||||||
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Europe
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12,015 | 18,060 | -33 | % | ||||||||
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Asia
Pacific
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2,500 | 611 | 309 | % | ||||||||
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Total
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$ | 20,616 | $ | 28,307 | -27 | % | ||||||
Since the
beginning of fiscal 2009, our operating results have been adversely affected by
the ongoing global recession, as our customers deferred or eliminated
investments in capital equipment. Additionally, customers who might
otherwise want to purchase capital goods have found it difficult to obtain
financing due to disruptions in the credit markets. During fiscal
2009 and the first quarter of fiscal 2010, these conditions had the greatest
impact on our European sales region, which is the primary market for our higher
priced, high performance, vertical machining centers. The European
sales region accounted for 58% of sales in the first quarter of fiscal 2010,
compared to 64% in the first quarter of fiscal 2009 and 74% in the first quarter
of fiscal 2008.
New order
bookings in the first quarter of fiscal 2010 were $20,607,000, a decrease of
$3,909,000, or 16%, from the same period in fiscal 2009. Orders
decreased in North America by $2,810,000, or 33%, and decreased in Europe by
$3,566,000, or 23%, while orders in the Asia Pacific sales region increased by
$2,467,000, or 413%, compared to the first quarter of fiscal
2009. During the first quarter of fiscal 2010, large government
contracts in Europe were cancelled due to budgetary restraints, reducing our
orders and backlog in Europe by approximately $2,005,000, or
11%. Excluding these order cancellations in Europe, the decrease in
total new order bookings for the first quarter of fiscal 2010 was $1,904,000, or
8%, on a worldwide basis and $1,551,000 million, or 10% in Europe compared to
the same period in fiscal 2009. The impact of currency translation on
new orders booked in fiscal 2010 was consistent with its impact on
sales.
Hurco’s
gross margin for the first quarter of fiscal 2010 was 19%, compared to 30% for
the same period in fiscal 2009. The decrease in margin as a
percentage of sales was due to lower sales in Europe of our higher margin, high
performance vertical machining centers, as well as the impact of fixed costs on
lower sales and production volume, and competitive pricing pressures on a global
basis.
Selling,
general and administrative expenses were $6,533,000 for the first quarter of
fiscal 2010, a decrease of $1,496,000, or 19%, from the first quarter of fiscal
2009. The decrease reflected lower sales commissions and the benefit of cost
reduction initiatives, partially offset by the unfavorable effect of a weaker
U.S. dollar in fiscal 2010 when translating foreign operating expenses to U.S.
dollars for financial reporting purposes.
Cash and
cash equivalents totaled $32,381,000 as of January 31, 2010, compared to
$28,782,000 as of October 31, 2009. Inventory as of January 31, 2010
was $53,472,000, a decrease of $6,809,000 from October 31, 2009, due to our
reduced production levels in response to lower demand.
Michael
Doar, Chairman, Chief Executive Officer and President, stated, “As our results
indicate, we continue to be significantly impacted by the ongoing global
recession. I credit our fiscally conservative culture for the
implementation of comprehensive cost saving initiatives at the onset of the
recession, which have allowed us to continue product and technology
development.”
Hurco
Companies, Inc. is an industrial technology company that designs and produces
interactive computer controls, software and computerized machine tools for the
worldwide metal cutting and metal forming industry. The end market for the
Company's products consists primarily of independent job shops and short-run
manufacturing operations within large corporations in industries such as
aerospace, defense, medical equipment, energy, transportation and computer
equipment. The Company is based in Indianapolis, Indiana, with manufacturing
operations in Taiwan and China, and sells its products through direct and
indirect sales forces throughout North America, Europe, and Asia. The company
has sales, application engineering support and service subsidiaries in Canada,
China, England, France, Germany, India, Italy, Poland, Singapore, South Africa,
Spain, and the United States of America. Web Site: www.hurco.com
This
news release contains forward looking statements which involve known and unknown
risks, uncertainties and other factors that may cause our actual results,
performance or achievements to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements. These factors include, among others, the impact of the
current global economic recession, including disruption in credit markets, other
changes in general economic and business conditions that affect demand for
computerized machine systems, computer numerical control systems and software
products, changes in manufacturing markets, innovations by competitors, our
ability to protect our intellectual property, fluctuations in exchange rates,
fluctuations in prices of raw materials, changes in market demands, quality and
delivery performance by our contract manufacturers and governmental actions and
initiatives including import and export restrictions and tariffs.
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Contact:
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John
Oblazney
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Vice
President & Chief Financial
Officer
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317-293-5309
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Hurco
Companies, Inc.
CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS
(In
thousands, except per-share data)
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Three Months Ended
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January 31,
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2010
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2009
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(unaudited)
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Sales
and service fees
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$ | 20,616 | $ | 28,307 | ||||
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Cost
of sales and service
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16,636 | 19,765 | ||||||
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Gross
profit
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3,980 | 8,542 | ||||||
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Selling,
general and administrative expenses
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6,533 | 8,029 | ||||||
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Operating
income (loss)
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(2,553 | ) | 513 | |||||
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Interest
expense
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14 | 23 | ||||||
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Interest
income
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20 | 104 | ||||||
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Investment
income
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5 | 28 | ||||||
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Other
expense (income), net
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277 | 73 | ||||||
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Income
(loss) before taxes
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(2,819 | ) | 549 | |||||
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Provision
(benefit) for income taxes
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(983 | ) | 195 | |||||
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Net
income (loss)
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$ | (1,836 | ) | $ | 354 | |||
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Earnings
(losses) per common share
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Basic
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$ | (0.29 | ) | $ | 0.06 | |||
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Diluted
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$ | (0.29 | ) | $ | 0.05 | |||
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Weighted
average common shares outstanding
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Basic
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6,441 | 6,421 | ||||||
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Diluted
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6,441 | 6,438 | ||||||
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OTHER CONSOLIDATED FINANCIAL DATA
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Three Months Ended
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|||||||
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January 31,
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Operating
Data:
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2010
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2009
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(unaudited)
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Gross
margin
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19.3 | % | 30.2 | % | ||||
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SG&A
expense as a percentage of sales
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31.7 | % | 28.4 | % | ||||
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Operating
income (loss) as a percentage of sales
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-12.4 | % | 1.8 | % | ||||
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Pre-tax
income (loss) as a percentage of sales
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-13.7 | % | 1.9 | % | ||||
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Effective
Tax Rate
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34.9 | % | 35.5 | % | ||||
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Depreciation
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833 | 791 | ||||||
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Capital
expenditures
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475 | 1,351 | ||||||
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Balance
Sheet Data:
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1/31/2010
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10/31/2009
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(unaudited)
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Working
capital (excluding cash)
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$ | 63,328 | $ | 68,675 | ||||
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Days
sales outstanding
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43 | 39 | ||||||
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Inventory
turns
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1.1 | 1.0 | ||||||
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Capitalization
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Total
debt
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$ | - | $ | - | ||||
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Shareholders'
equity
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118,024 | 120,376 | ||||||
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Total
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$ | 118,024 | $ | 120,376 | ||||
Hurco
Companies, Inc.
CONDENSED
CONSOLIDATED BALANCE SHEET
(In
thousands, except share and per-share data)
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January 31,
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October 31,
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2010
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2009
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(unaudited)
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(audited)
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ASSETS
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Current
assets:
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Cash
and cash equivalents
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$ | 32,381 | $ | 28,782 | ||||
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Accounts
receivable, net
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12,350 | 13,988 | ||||||
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Refundable
taxes
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5,516 | 7,121 | ||||||
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Inventories,
net
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53,472 | 60,281 | ||||||
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Deferred
income taxes, net
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2,578 | 2,670 | ||||||
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Derivative
assets
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1,140 | 376 | ||||||
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Other
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6,174 | 5,046 | ||||||
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Total
current assets
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113,611 | 118,264 | ||||||
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Property
and equipment:
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Land
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782 | 782 | ||||||
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Building
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7,116 | 7,116 | ||||||
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Machinery
and equipment
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15,055 | 14,995 | ||||||
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Leasehold
improvements
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1,985 | 2,021 | ||||||
| 24,938 | 24,914 | |||||||
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Less
accumulated depreciation and amortization
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(12,178 | ) | (11,802 | ) | ||||
| 12,760 | 13,112 | |||||||
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Non-current
assets:
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Software
development costs, less accumulated amortization
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6,503 | 6,503 | ||||||
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Other
assets
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6,644 | 6,864 | ||||||
| $ | 139,518 | $ | 144,743 | |||||
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LIABILITIES
AND SHAREHOLDERS' EQUITY
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Current
liabilities:
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Accounts
payable
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$ | 8,021 | $ | 8,262 | ||||
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Derivative
liabilities
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542 | 2,234 | ||||||
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Accrued
expenses
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9,339 | 10,311 | ||||||
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Total
current liabilities
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17,902 | 20,807 | ||||||
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Non-current
liabilities:
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Deferred
income taxes, net
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2,599 | 2,570 | ||||||
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Deferred
credits and other obligations
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993 | 990 | ||||||
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Total
liabilities
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21,494 | 24,367 | ||||||
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Shareholders'
equity:
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||||||||
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Preferred
stock: no par value per share; 1,000,000 shares authorized; no
shares issued
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Common
stock: no par value; $.10 stated value per share; 13,250,000
shares authorized; and 6,440,851 shares issued and
outstanding
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644 | 644 | ||||||
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Additional
paid-in capital
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52,022 | 52,003 | ||||||
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Retained
earnings
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67,732 | 69,568 | ||||||
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Accumulated
other comprehensive loss
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(2,374 | ) | (1,839 | ) | ||||
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Total
shareholders' equity
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118,024 | 120,376 | ||||||
| $ | 139,518 | $ | 144,743 | |||||