New
Jersey
|
22-2378738
|
|
(STATE
OR OTHER JURISDICTION OF
INCORPORATION
OR ORGANIZATION)
|
(I.R.S.
EMPLOYER
IDENTIFICATION
NO. )
|
Large
accelerated filer o
|
Accelerated
filer x
|
Non-accelerated
filer o
|
FINANCIAL
INFORMATION
|
3
|
|
|
|
|
ITEM
1.
|
FINANCIAL
STATEMENTS
|
3
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
|
3
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
|
4
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY AND COMPREHENSIVE INCOME
(UNAUDITED)
|
6
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
|
7
|
|
NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
|
8
|
|
|
|
ITEM
2.
|
MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
|
21
|
|
|
|
ITEM
3.
|
QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
31
|
|
|
|
ITEM
4.
|
CONTROLS
AND PROCEDURES
|
32
|
|
|
|
PART
II.
|
OTHER
INFORMATION
|
32
|
|
|
|
ITEM
1.
|
LEGAL
PROCEEDINGS
|
32
|
|
|
|
ITEM
1A.
|
RISK
FACTORS
|
33
|
|
|
|
EXHIBITS
|
33
|
|
|
|
|
34
|
|
Three
months ended
December
31,
|
Nine
months ended
December
31,
|
|||||||||||
(Dollars
in thousands, except per share amounts )
|
2006
|
2005
|
2006
|
2005
|
|||||||||
Net
sales
|
$
|
49,766
|
$
|
31,006
|
$
|
145,867
|
$
|
85,854
|
|||||
Cost
of goods sold
|
28,113
|
16,450
|
82,396
|
44,994
|
|||||||||
Gross
profit
|
21,653
|
14,556
|
63,471
|
40,860
|
|||||||||
Total
operating expenses
|
15,935
|
9,459
|
46,666
|
28,850
|
|||||||||
Operating
income
|
5,718
|
5,097
|
16,805
|
12,010
|
|||||||||
Interest
expense, net
|
1,518
|
541
|
4,749
|
1,499
|
|||||||||
Other
expense (income)
|
(12
|
)
|
125
|
436
|
130
|
||||||||
Income
from continuing operations before minority interest and
income
taxes
|
4,212
|
4,431
|
11,620
|
10,381
|
|||||||||
Minority
interest, net of income taxes
|
230
|
—
|
460
|
—
|
|||||||||
Income
tax expense from continuing operations
|
648
|
697
|
2,019
|
2,942
|
|||||||||
Income
from continuing operations
|
$
|
3,334
|
$
|
3,734
|
$
|
9,141
|
$
|
7,439
|
|||||
Discontinued
operations (Note 1):
|
|||||||||||||
Income
(loss) from discontinued operations before income taxes
|
(5
|
)
|
1,913
|
(37
|
)
|
6,716
|
|||||||
Income
tax expense (benefit) from discontinued operations
|
(1
|
)
|
348
|
(7
|
)
|
1,574
|
|||||||
Income
from discontinued operations, before gain
|
(4
|
)
|
1,565
|
(30
|
)
|
5,142
|
|||||||
Gain
on disposition of discontinued operations (net of income
tax)
|
2,156
|
9,113
|
2,156
|
9,113
|
|||||||||
Income
from discontinued operations
|
2,152
|
10,678
|
2,126
|
14,255
|
|||||||||
Net
income
|
$
|
5,486
|
$
|
14,412
|
$
|
11,267
|
$
|
21,694
|
|||||
|
|||||||||||||
Net
income per common share - Basic
|
|||||||||||||
Income
from continuing operations
|
$
|
0.24
|
$
|
0.27
|
$
|
0.65
|
$
|
0.54
|
|||||
Income
from discontinued operations
|
—
|
0.11
|
—
|
0.38
|
|||||||||
Gain
from disposition
|
0.15
|
0.67
|
0.15
|
0.67
|
|||||||||
Net
income per common share - Basic
|
$
|
0.39
|
$
|
1.05
|
$
|
0.80
|
$
|
1.59
|
|||||
|
|||||||||||||
Net
income per common share - Diluted
|
|||||||||||||
Income
from continuing operations
|
$
|
0.23
|
$
|
0.26
|
$
|
0.63
|
$
|
0.52
|
|||||
Income
from discontinued operations
|
—
|
0.11
|
—
|
0.36
|
|||||||||
Gain
from disposition
|
0.15
|
0.64
|
0.15
|
0.64
|
|||||||||
Net
income per common share - Diluted
|
$
|
0.38
|
$
|
1.01
|
$
|
0.78
|
$
|
1.52
|
|||||
|
|||||||||||||
Weighted
average shares outstanding - Basic
|
14,177,323
|
13,682,326
|
14,119,553
|
13,662,200
|
|||||||||
Weighted
average shares outstanding - Diluted
|
14,400,595
|
14,278,889
|
14,410,870
|
14,309,111
|
|
December
31,
|
March
31,
|
|||||
(Dollars
in thousands)
|
2006
|
2006
|
|||||
|
|
|
|||||
ASSETS
|
|||||||
|
|||||||
Current
assets:
|
|||||||
Cash
and cash equivalents
|
$
|
8,275
|
$
|
9,166
|
|||
Accounts
receivable, trade, net of allowance for doubtful accounts of $489
and
$447, respectively
|
30,640
|
19,381
|
|||||
Inventories,
net
|
36,833
|
25,099
|
|||||
Deferred
income taxes, net
|
2,627
|
1,510
|
|||||
Prepaid
expenses and other current assets
|
2,666
|
1,821
|
|||||
Other
receivables
|
1,153
|
3,409
|
|||||
Other
receivable due from joint venture partner
|
668
|
—
|
|||||
Current
portion of promissory note receivable
|
2,978
|
1,900
|
|||||
Current
assets of discontinued operations
|
—
|
1,111
|
|||||
Total
current assets
|
85,840
|
63,397
|
|||||
|
|||||||
Property
and equipment, net
|
25,948
|
22,086
|
|||||
Goodwill
|
75,949
|
41,848
|
|||||
Acquired
intangible assets, net
|
18,116
|
11,250
|
|||||
Deferred
income taxes, net
|
8,773
|
10,785
|
|||||
Promissory
note receivable, net of current portion
|
1,078
|
1,397
|
|||||
Other
assets
|
1,921
|
1,542
|
|||||
Other
assets of discontinued operations
|
—
|
119
|
|||||
Total
Assets
|
$
|
217,625
|
$
|
152,424
|
|
December
31,
|
March
31,
|
|||||
(Dollars
in thousands)
|
2006
|
2006
|
|||||
|
|
|
|||||
LIABILITIES,
MINORITY INTEREST AND SHAREHOLDERS' EQUITY
|
|||||||
|
|||||||
Current
liabilities:
|
|||||||
Current
portion of promissory notes payable
|
$
|
350
|
$
|
1,000
|
|||
Current
portion of deferred acquisition obligation
|
1,958
|
3,972
|
|||||
Short-term
debt
|
181
|
3,777
|
|||||
Current
portion of long-term debt
|
2,129
|
2,553
|
|||||
Accounts
payable
|
15,104
|
11,337
|
|||||
Accrued
expenses
|
3,650
|
2,190
|
|||||
Accrued
compensation
|
5,636
|
3,116
|
|||||
Income
taxes payable
|
2,259
|
789
|
|||||
Current
portion of capital lease obligation
|
140
|
606
|
|||||
Other
current liabilities
|
3,753
|
1,731
|
|||||
Current
liabilities of discontinued operations
|
—
|
1,266
|
|||||
Total
current liabilities
|
35,160
|
32,337
|
|||||
|
|||||||
|
|||||||
Revolver
|
44,210
|
—
|
|||||
Promissory
notes payable, net of current portion
|
—
|
100
|
|||||
Long-term
debt, net of current portion
|
18,782
|
16,794
|
|||||
Contingency
consideration provision
|
—
|
3,517
|
|||||
Capital
lease obligation, net of current portion
|
2,143
|
2,180
|
|||||
Other
liabilities
|
559
|
1,999
|
|||||
Total
liabilities
|
100,854
|
56,927
|
|||||
|
|||||||
Minority
Interest
|
1,546
|
—
|
|||||
|
|||||||
Shareholders'
equity:
|
|||||||
Serial
preferred stock; 221,756 shares authorized; none
outstanding
|
—
|
—
|
|||||
Common
stock, no par; 20,000,000 shares authorized; 14,249,980
and
13,970,033 shares issued and outstanding, respectively
|
—
|
—
|
|||||
Additional
paid-in capital
|
71,092
|
66,371
|
|||||
Retained
earnings
|
42,530
|
31,263
|
|||||
Accumulated
other comprehensive income (loss)
|
1,603
|
(2,137
|
)
|
||||
Total
shareholders' equity
|
115,225
|
95,497
|
|||||
Total
liabilities, minority interest and shareholders' equity
|
$
|
217,625
|
$
|
152,424
|
|
|
|
Accumulated
|
|
|
|||||||||||
|
Additional
|
|
Other
|
|
|
|||||||||||
|
paid-in
|
Retained
|
Comprehensive
|
|
Comprehensive
|
|||||||||||
(Dollars
in thousands)
|
capital
|
Earnings
|
Income
(Loss)
|
Total
|
Income
|
|||||||||||
Balance,
March 31, 2005
|
$
|
61,787
|
6,729
|
(500
|
)
|
$
|
68,016
|
|||||||||
Comprehensive
income:
|
||||||||||||||||
Net
income
|
21,694
|
21,694
|
$
|
21,694
|
||||||||||||
Currency
translation adjustment
|
(2,276
|
)
|
(2,276
|
)
|
(2,276
|
)
|
||||||||||
Comprehensive
income
|
$
|
19,418
|
||||||||||||||
Options
issued related to sale of Consumer
|
913
|
913
|
||||||||||||||
Proceeds
from exercise of stock options
|
1,690
|
1,690
|
||||||||||||||
Tax
benefit from exercise of stock options
|
627
|
|
|
627
|
||||||||||||
Balance,
December 31, 2005
|
$
|
65,017
|
$
|
28,423
|
$
|
(2,776
|
)
|
$
|
90,664
|
|||||||
Balance,
March 31, 2006
|
$
|
66,371
|
$
|
31,263
|
$
|
(2,137
|
)
|
$
|
95,497
|
|||||||
Comprehensive
income:
|
||||||||||||||||
Net
income
|
11,267
|
11,267
|
$
|
11,267
|
||||||||||||
Currency
translation adjustment
|
3,740
|
3,740
|
3,740
|
|||||||||||||
Comprehensive
income
|
$
|
15,007
|
||||||||||||||
Non-cash
equity based compensation (SFAS 123R)
|
1,985
|
1,985
|
||||||||||||||
Issuance
of common stock for acquisition of BetaTherm
|
1,000
|
1,000
|
||||||||||||||
Proceeds
from exercise of stock options
|
1,736
|
|
|
1,736
|
||||||||||||
Balance,
December 31, 2006
|
$
|
71,092
|
$
|
42,530
|
$
|
1,603
|
$
|
115,225
|
|
For
the nine months ended
|
||||||
|
December
31,
|
||||||
(Dollars
in thousands)
|
2006
|
2005
|
|||||
|
|
|
|||||
Cash
flows from operating activities:
|
|||||||
Net
income
|
$
|
11,267
|
$
|
21,694
|
|||
Income
(loss) from discontinued operations - Consumer
|
$ |
(30
|
)
|
$
|
5,142
|
||
Less:
Gain on sale of discontinued operations - Consumer
|
2,156
|
9,113
|
|||||
Income
from continuing operations
|
9,141
|
7,439
|
|||||
|
|||||||
Adjustments
to reconcile net income to net cash
|
|||||||
provided
by (used) operating activities from continuing operations:
|
|||||||
Depreciation
and amortization
|
7,207
|
3,858
|
|||||
Gain
on sale of assets
|
35
|
17
|
|||||
Provision
for doubtful accounts
|
133
|
(124
|
)
|
||||
Provision
for inventory reserve
|
1,454
|
1,922
|
|||||
Provision
for warranty
|
306
|
18
|
|||||
Minority
interest
|
460
|
—
|
|||||
Non-cash
equity based compensation (SFAS 123R)
|
1,985
|
—
|
|||||
Tax
benefit on exercise of stock options and warrants
|
—
|
627
|
|||||
Net
change in operating assets and liabilities:
|
|||||||
Accounts
receivable, trade
|
(4,136
|
)
|
(1,165
|
)
|
|||
Inventories
|
(7,967
|
)
|
(7,002
|
)
|
|||
Prepaid
expenses and other current assets
|
(75
|
)
|
(287
|
)
|
|||
Other
assets
|
(27
|
)
|
533
|
||||
Accounts
payable
|
2,041
|
2,574
|
|||||
Accrued
expenses and other liabilities
|
694
|
95
|
|||||
Income
taxes payable
|
344
|
2,446
|
|||||
Net
cash provided by operating activities from continuing
operations
|
11,595
|
10,951
|
|||||
Cash
flows used in investing activities from continuing
operations:
|
|||||||
Purchases
of property and equipment
|
(5,015
|
)
|
(6,276
|
)
|
|||
Proceeds
from sale of equipment
|
90
|
—
|
|||||
Acquisition
of business, net of cash acquired
|
(46,325
|
)
|
(3,445
|
)
|
|||
Net
cash used in investing activities from continuing
operations
|
(51,250
|
)
|
(9,721
|
)
|
|||
Cash
flows from financing activities from continuing
operations:
|
|||||||
Borrowing
under long-term debt note
|
21,885
|
—
|
|||||
Repayments
under long-term notes
|
(19,282
|
)
|
(2,371
|
)
|
|||
Borrowings
under short-term debt, revolver and notes payable
|
48,133
|
7,262
|
|||||
Payments
under short-term debt, revolver, leases and notes payable
|
(11,340
|
)
|
(6,596
|
)
|
|||
Payments
under deferred acquisition payments
|
(3,972
|
)
|
(1,400
|
)
|
|||
Minority
interest payments
|
(112
|
)
|
—
|
||||
Tax
benefit on exercise of stock options and warrants
|
—
|
—
|
|||||
Proceeds
from exercise of options
|
1,736
|
1,690
|
|||||
Net
cash provided (used) in financing activities from continuing
operations
|
37,048
|
(1,415
|
)
|
||||
Net
cash provided by operating activities of discontinued
operations
|
208
|
7,109
|
|||||
Net
cash provided by investing activities of discontinued
operations
|
1,418
|
2,871
|
|||||
Net
cash provided by discontinued operations
|
1,626
|
9,980
|
|||||
Net
change in cash and cash equivalents
|
(981
|
)
|
9,795
|
||||
Effect
of exchange rate changes on cash
|
90
|
(63
|
)
|
||||
Cash,
beginning of period
|
9,166
|
4,402
|
|||||
Cash,
end of period
|
$
|
8,275
|
$
|
14,134
|
|||
|
|||||||
Supplemental
Cash Flow Information:
|
|||||||
Cash
paid during the period for:
|
|||||||
Interest
|
$
|
4,868
|
$
|
1,456
|
|||
Income
taxes
|
549
|
3,276
|
|||||
|
|||||||
Noncash
investing and financing transactions:
|
|||||||
Deferred
acquisition obligation
|
1,958
|
—
|
|||||
Issuance
of stock in connection with acquisition of BetaTherm
|
1,000
|
—
|
|||||
Promissory
note receivable from sale of assets - Consumer
|
—
|
3,800
|
|||||
Promissory
note payable from acquisition
|
—
|
1,350
|
|||||
Promissory
note receivable from earn-out on sale of discontinued operations -
Consumer
|
2,156
|
—
|
Acquired
Company
|
|
Effective
Date of Acquisition
|
Country
|
Elekon
Industries USA, Inc. (‘Elekon’)
|
|
June
24, 2004
|
USA
|
Entran
Devices, Inc. and Entran SA (‘Entran’)
|
|
July
16, 2004
|
USA
and France
|
Encoder
Devices, LLC (‘Encoder’)
|
|
July
16, 2004
|
USA
|
Humirel,
SA (‘Humirel’)
|
|
December
1, 2004
|
France
|
MWS
Sensorik GmbH (‘MWS’)
|
|
January
1, 2005
|
Germany
|
Polaron
Components Ltd (‘Polaron’)
|
|
February
1, 2005
|
United
Kingdom
|
HL
Planartechnik GmbH (‘HLP’)
|
|
November
30, 2005
|
Germany
|
Assistance
Technique Experimentale (‘ATEX’)
|
|
January
19, 2006
|
France
|
YSIS
Incorporated (‘YSI Temperature’)
|
|
April
1, 2006
|
USA
and Japan
|
BetaTherm
Group Ltd. (‘BetaTherm’)
|
|
April
1, 2006
|
Ireland
and USA
|
Three
months ended
December
31, 2005
|
Nine
months ended
December
31, 2005
|
||||||
Net
income, as reported:
|
$
|
14,412
|
$
|
21,694
|
|||
Add:
Share-based employee compensation reported in net income, net of
income
taxes
|
—
|
—
|
|||||
Deduct:
Share-based employee compensation under the fair value method for
all
awards, net of income taxes
|
552
|
1,718
|
|||||
Pro
forma
|
$
|
13,860
|
$
|
19,976
|
|||
|
|||||||
Basic
net income per share, as reported:
|
$
|
1.05
|
$
|
1.59
|
|||
Add:
Share-based employee compensation reported in net income, net of
income
taxes
|
—
|
—
|
|||||
Deduct:
Share-based employee compensation under the fair value method for
all
awards, net of income taxes
|
(0.04
|
)
|
(0.13
|
)
|
|||
Pro
forma
|
$
|
1.01
|
$
|
1.46
|
|||
|
|||||||
Diluted
net income per share, as reported:
|
$
|
1.01
|
$
|
1.52
|
|||
Add:
Share-based employee compensation reported in net income, net of
income
taxes
|
—
|
—
|
|||||
Deduct:
Share-based employee compensation under the fair value method for
all
awards, net of income taxes
|
(0.04
|
)
|
(0.12
|
)
|
|||
Pro
forma
|
$
|
0.97
|
$
|
1.40
|
Three
months ended December 31,
|
Nine
months ended December 31,
|
||||||||||||
2006
|
2005
|
2006
|
2005
|
||||||||||
Dividend
yield
|
—
|
—
|
—
|
—
|
|||||||||
Expected
Volality
|
39.38
|
%
|
30.40
|
%
|
38.89
|
%
|
30.71
|
%
|
|||||
Risk-Free
Interest Rate
|
4.61
|
%
|
5.00
|
%
|
4.86
|
%
|
4.98
|
%
|
|||||
Expected
life of options (in years)
|
4.9
|
5.0
|
4.3
|
4.9
|
|||||||||
Weighted-average
grant-date fair value
|
$
|
9.33
|
$
|
8.66
|
$
|
7.46
|
$
|
8.33
|
Number
of shares
|
Weighted-Average
Exercise
Price
|
Weighted-Average
Remaining
Contract
Life
in Years
|
||||||||
Outstanding
options at beginning of period
|
1,483,504
|
$
|
17.44
|
5.49
|
||||||
Granted
|
743,000
|
24.11
|
||||||||
Exercised
|
(239,350
|
)
|
7.01
|
|||||||
Forfeited
and expired
|
(64,352
|
)
|
21.76
|
|||||||
Outstanding
options at end of period
|
1,922,802
|
21.18
|
6.05
|
|||||||
Outstanding
options exerciseable at end of period
|
578,670
|
$
|
15.23
|
3.71
|
Number
of shares
|
Weighted-Average
Grant-
Date
Fair Value
|
||||||
Non-vested
stock options at beginning of period
|
946,934
|
$
|
5.51
|
||||
Granted
|
743,000
|
||||||
Exercised
|
(47,936
|
)
|
|||||
Vested
|
(258,070
|
)
|
|||||
Forfeited
and expired
|
(64,352
|
)
|
|||||
Non-vested
stock options at end of period
|
1,319,576
|
$
|
5.73
|
Net
income
(Numerator)
|
Weighted
Average
Shares
(Denominator)
|
Per-Share
Amount
|
||||||||
Quarter
ended December 31, 2006:
|
||||||||||
Basic
per share information
|
$
|
5,486
|
14,177,323
|
$
|
0.39
|
|||||
Effect
of dilutive securities
|
—
|
223,272
|
(0.01
|
)
|
||||||
Diluted
per-share information
|
$
|
5,486
|
14,400,595
|
$
|
0.38
|
|||||
Quarter
ended December 31, 2005:
|
||||||||||
Basic
per share information
|
$
|
14,412
|
13,682,326
|
$
|
1.05
|
|||||
Effect
of dilutive securities
|
—
|
596,563
|
(0.04
|
)
|
||||||
Diluted
per-share information
|
$
|
14,412
|
14,278,889
|
$
|
1.01
|
|||||
Nine
months ended December 31, 2006:
|
||||||||||
Basic
per share information
|
$
|
11,267
|
14,119,553
|
$
|
0.80
|
|||||
Effect
of dilutive securities
|
—
|
291,317
|
(0.02
|
)
|
||||||
Diluted
per-share information
|
$
|
11,267
|
14,410,870
|
$
|
0.78
|
|||||
Nine
months ended December 31, 2005:
|
||||||||||
Basic
per share information
|
$
|
21,694
|
13,662,200
|
$
|
1.59
|
|||||
Effect
of dilutive securities
|
—
|
646,911
|
(0.07
|
)
|
||||||
Diluted
per-share information
|
$
|
21,694
|
14,309,111
|
$
|
1.52
|
|
December
31,
|
March
31,
|
|||||
|
2006
|
2006
|
|||||
Raw
Materials
|
$
|
16,899
|
$
|
13,586
|
|||
Work-in-Process
|
5,963
|
4,392
|
|||||
Finished
Goods
|
13,971
|
7,121
|
|||||
|
$
|
36,833
|
$
|
25,099
|
|||
|
|||||||
Inventory
Reserves:
|
$
|
3,593
|
$
|
3,296
|
December
31,
|
March
31,
|
|||||||||
2006
|
2006
|
Useful
Life
|
||||||||
Production
equipment & tooling
|
$
|
31,236
|
$
|
27,156
|
3-10
years
|
|||||
Building
and leasehold improvements
|
7,487
|
3,914
|
39
years or lesser of useful life or
remaining
term of lease
|
|||||||
Furniture
and equipment
|
8,472
|
7,135
|
3-10
years
|
|||||||
Construction-in-progress
|
1,858
|
1,999
|
|
|||||||
Total
|
49,053
|
40,204
|
||||||||
Less:
accumulated depreciation and amortization
|
(23,105
|
)
|
(18,118
|
)
|
||||||
$
|
25,948
|
$
|
22,086
|
|
|
Preliminary
Allocation
|
|
Revised
Allocation
|
|
||
Assets:
|
|
|
|
|
|
||
Accounts
receivable
|
|
$
|
1,116
|
|
$
|
1,065
|
|
Inventory
|
|
|
2,081
|
|
|
1,909
|
|
Property
and equipment
|
|
|
4,228
|
|
|
1,713
|
|
Acquired
intangible assets
|
|
|
1,684
|
|
|
603
|
|
Deferred
income taxes
|
|
|
2,721
|
|
|
3,010
|
|
Other
|
|
|
284
|
|
|
284
|
|
|
|
|
12,114
|
|
|
8,584
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
Accounts
payable
|
|
|
(678
|
)
|
|
(678
|
)
|
Accrued
compensation
|
|
|
(392
|
)
|
|
(392
|
)
|
Debt
and other non-operational liabilities
|
|
|
(4,193
|
)
|
|
(4,193
|
)
|
Negative
goodwill provision
|
|
|
(3,530
|
)
|
|
—
|
|
Other
|
|
|
(277
|
)
|
|
(277
|
)
|
|
|
|
(9,070
|
)
|
|
(5,540
|
)
|
Total
Purchase Price
|
|
$
|
3,044
|
|
$
|
3,044
|
|
Assets:
|
|
|
|
|
Cash
|
|
$
|
692
|
|
Accounts
receivable
|
|
|
401
|
|
Inventory
|
|
|
117
|
|
Property
and equipment
|
|
|
131
|
|
Acquired
intangible assets
|
|
|
834
|
|
Goodwill
|
|
|
2,670
|
|
Other
|
|
|
31
|
|
|
|
|
4,876
|
|
Liabilities:
|
|
|
|
|
Accounts
payable
|
|
|
(416
|
)
|
Accrued
compensation
|
|
|
(157
|
)
|
Deferred
income taxes
|
|
|
(277
|
)
|
|
|
|
(850
|
)
|
Total
Purchase Price
|
|
$
|
4,026
|
|
Cash
paid
|
|
$
|
2,502
|
|
Deferred
acquisition payments
|
|
|
1,450
|
|
Costs
|
|
|
74
|
|
Total
Purchase Price
|
|
$
|
4,026
|
|
Assets:
|
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
$
|
3,523
|
|
Inventory
|
|
|
1,662
|
|
Property
and equipment
|
|
|
1,154
|
|
Acquired
intangible assets
|
|
|
2,142
|
|
Goodwill
|
|
|
7,426
|
|
Other
|
|
|
1,048
|
|
|
|
|
16,955
|
|
Liabilities:
|
|
|
|
|
Accounts
payable
|
|
|
(835
|
)
|
Accrued
compensation
|
|
|
(769
|
)
|
Minority
interest
|
|
|
(1,099
|
)
|
|
|
|
(2,703
|
)
|
Total
Purchase Price
|
|
$
|
14,252
|
|
Assets:
|
|
|
|
|
Cash
|
|
$
|
2,388
|
|
Accounts
receivable
|
|
|
3,180
|
|
Inventory
|
|
|
2,521
|
|
Property
and equipment
|
|
|
3,552
|
|
Acquired
intangible assets
|
|
|
9,292
|
|
Goodwill
|
|
|
24,864
|
|
Other
|
|
|
226
|
|
|
|
|
46,023
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
Accounts
payable
|
|
|
(2,729
|
)
|
Debt
|
|
|
(3,737
|
)
|
Deferred
income taxes
|
|
|
(2,309
|
)
|
|
|
|
(8,775
|
)
|
Total
Purchase Price
|
|
$
|
37,248
|
|
|
|
|
|
|
Cash
paid
|
|
$
|
33,741
|
|
Deferred
acquisition payment
|
|
|
1,787
|
|
MEAS
shares
|
|
|
1,000
|
|
Costs
|
|
|
720
|
|
Total
Purchase Price
|
|
$
|
37,248
|
|
December
31, 2006
|
March
31, 2006
|
|||||||||||||||||||||
Life
in
years
|
Gross
Amount
|
Accumulated
Amortization
|
Net
|
Gross
Amount
|
Accumulated
Amortization
|
Net
|
||||||||||||||||
Amortizable
intangible assets:
|
||||||||||||||||||||||
Customer
relationships
|
5-15
|
$
|
15,411
|
$
|
(2,619
|
)
|
$
|
12,792
|
$
|
8,193
|
$
|
(922
|
)
|
$
|
7,271
|
|||||||
Patents
|
5-19.5
|
$
|
2,491
|
(397
|
)
|
$
|
2,094
|
2,642
|
(422
|
)
|
2,220
|
|||||||||||
Tradenames
|
1.5-3
|
$
|
1,013
|
(422
|
)
|
$
|
591
|
570
|
(135
|
)
|
435
|
|||||||||||
Backlog
|
1
|
$
|
1,904
|
(1,523
|
)
|
$
|
381
|
654
|
(542
|
)
|
112
|
|||||||||||
Covenants
not-to-compete
|
3
|
$
|
903
|
(749
|
)
|
$
|
154
|
903
|
(523
|
)
|
380
|
|||||||||||
Proprietary
technology
|
5-15
|
$
|
2,431
|
(327
|
)
|
$
|
2,104
|
989
|
(157
|
)
|
832
|
|||||||||||
$
|
24,153
|
$
|
(6,037
|
)
|
$
|
18,116
|
$
|
13,951
|
$
|
(2,701
|
)
|
$
|
11,250
|
Amortization
|
||||
Year
|
Expense
|
|||
1
|
$
|
3,416
|
||
2
|
2,737
|
|||
3
|
2,563
|
|||
4
|
2,484
|
|||
5
|
2,141
|
|||
Thereafter
|
4,775
|
|||
$
|
18,116
|
|
Three
months ended
December
31, 2005
|
Nine
months ended
December
31, 2005
|
|||||
|
|
|
|||||
Net
sales
|
$
|
41,657
|
$
|
120,710
|
|||
Income
from continuing operations
|
$
|
1,882
|
$
|
1,647
|
|||
Income
from continuing operations per common share:
|
|||||||
Basic
|
$
|
0.14
|
$
|
0.12
|
|||
Diluted
|
$
|
0.13
|
$
|
0.11
|
December
31,
|
March
31,
|
||||||
2006
|
2006
|
||||||
Short-term
debt:
|
|||||||
Revolver
|
$
|
—
|
$
|
3,500
|
|||
European
short-term borrowings
|
181
|
277
|
|||||
$
|
181
|
$
|
3,777
|
December
31,
2006
|
March
31,
2006
|
||||||
Prime
or LIBOR plus 2.75% or 1% five-year term loan with a final installment
due
on March 31, 2011
|
$
|
18,500
|
$
|
17,500
|
|||
Governmental
loans from French agencies at no interest and payable based on
R&D
expenditures.
|
756
|
535
|
|||||
Term
credit facility with six banks at an interest rate of 4% payable
through
2010.
|
1,084
|
750
|
|||||
Bonds
issued at an interest rate of 3% payable through 2009.
|
462
|
423
|
|||||
Term
credit facility with two banks at interest rates of 3.9%-4.0% payable
through 2009.
|
109
|
139
|
|||||
$
|
20,911
|
$
|
19,347
|
||||
Less
current portion of long-term debt
|
2,129
|
2,553
|
|||||
$
|
18,782
|
$
|
16,794
|
||||
6%
promissory notes payable in six quarterly installments through
July 1,
2007
|
$
|
350
|
$
|
1,100
|
|||
Less
current portion of promissory notes payable
|
350
|
1,000
|
|||||
|
$ |
—
|
$
|
100
|
Year
|
Term
|
Other
|
Subtotal
|
Notes
Payable
|
Revolver
|
Total
|
|||||||||||||
1
|
$
|
2,000
|
$
|
129
|
$
|
2,129
|
$
|
350
|
—
|
$
|
2,479
|
||||||||
2
|
2,000
|
1,325
|
$
|
3,325
|
—
|
—
|
3,325
|
||||||||||||
3
|
2,000
|
733
|
$
|
2,733
|
—
|
—
|
2,733
|
||||||||||||
4
|
2,000
|
182
|
$
|
2,182
|
—
|
—
|
2,182
|
||||||||||||
5
|
10,500
|
25
|
$
|
10,525
|
—
|
44,210
|
54,735
|
||||||||||||
Thereafter
|
—
|
17
|
$
|
17
|
—
|
—
|
17
|
||||||||||||
Total
|
$
|
18,500
|
$
|
2,411
|
$
|
20,911
|
$
|
350
|
$
|
44,210
|
$
|
65,471
|
Nine
months ended December 31,
|
|||||||
2006
|
2005
|
||||||
Net
Sales:
|
|||||||
United
States
|
$
|
78,533
|
$
|
51,705
|
|||
Europe
and other
|
34,607
|
13,436
|
|||||
Asia
|
32,727
|
20,713
|
|||||
Total:
|
$
|
145,867
|
$
|
85,854
|
December
31,
|
March
31,
|
||||||
2006
|
2006
|
||||||
Long
lived assets:
|
|||||||
United
States
|
$
|
5,716
|
$
|
4,230
|
|||
Europe
and other
|
10,339
|
8,428
|
|||||
Asia
|
9,893
|
9,428
|
|||||
Total:
|
$
|
25,948
|
$
|
22,086
|
l
|
Conditions
in the general economy and in the markets served by us;
|
l
|
Competitive
factors, such as price pressures and the potential emergence of rival
technologies;
|
l
|
Interruptions
of suppliers’ operations or the refusal of our suppliers to provide us
with component materials;
|
l
|
Timely
development, market acceptance and warranty performance of new
products;
|
l
|
Changes
in product mix, costs and yields and fluctuations in foreign currency
exchange rates;
|
l
|
Uncertainties
related to doing business in Europe, Hong Kong and
China;
|
l
|
Legal
proceedings described below under “Part II. Item 1 - Legal Proceedings”;
and
|
l
|
The
risk factors listed from time to time in our SEC
reports.
|
– |
PFG/Glen
MacGibbon: Pressure/Force
|
– |
PVG/Vic
Chatigny: Position/Vibration/Piezo
|
– |
TPG/Terence
Monaghan: Temperature/Optical
|
– |
HCG/Jean-Francois
Allier: Humidity/Chemical/Gas
|
|
Three
months ended December 31,
|
||||||
(Dollars
in thousands)
|
2006
|
2005
|
|||||
Net
sales
|
$
|
49,766
|
$
|
31,006
|
|||
Cost
of goods sold
|
28,113
|
16,450
|
|||||
Gross
profit
|
21,653
|
14,556
|
|||||
Operating
expenses:
|
|||||||
Selling,
general, and administrative
|
14,004
|
9,068
|
|||||
Non-cash
equity based compensation (SFAS 123R)
|
782
|
—
|
|||||
Amortization
of acquired intangibles
|
1,149
|
391
|
|||||
Total
operating expenses
|
15,935
|
9,459
|
|||||
Operating
income
|
5,718
|
5,097
|
|||||
Interest
expense, net
|
1,518
|
541
|
|||||
Other
expense (income)
|
(12
|
)
|
125
|
||||
Income
from continuing operations before minority interest and income
taxes
|
4,212
|
4,431
|
|||||
Minority
interest, net of income taxes
|
230
|
—
|
|||||
Income
tax expense from continuing operations
|
648
|
697
|
|||||
Income
from continuing operations
|
$
|
3,334
|
$
|
3,734
|
|
Nine
months ended December 31,
|
||||||
(Dollars
in thousands)
|
2006
|
2005
|
|||||
Net
sales
|
$
|
145,867
|
$
|
85,854
|
|||
Cost
of goods sold
|
82,396
|
44,994
|
|||||
Gross
profit
|
63,471
|
40,860
|
|||||
Operating
expenses:
|
|||||||
Selling,
general, and administrative
|
41,383
|
27,630
|
|||||
Non-cash
equity based compensation (SFAS 123R)
|
1,985
|
—
|
|||||
Amortization
of acquired intangibles
|
3,298
|
1,220
|
|||||
Total
operating expenses
|
46,666
|
28,850
|
|||||
Operating
income
|
16,805
|
12,010
|
|||||
Interest
expense, net
|
4,749
|
1,499
|
|||||
Other
expense
|
436
|
130
|
|||||
Income
from continuing operations before minority interest and income
taxes
|
11,620
|
10,381
|
|||||
Minority
interest, net of income taxes
|
460
|
—
|
|||||
Income
tax expense from continuing operations
|
2,019
|
2,942
|
|||||
Income
from continuing operations
|
$
|
9,141
|
$
|
7,439
|
December
31,
|
March
31,
|
||||||
2006
|
2006
|
||||||
Short-term
debt:
|
|||||||
Revolver
|
$
|
—
|
$
|
3,500
|
|||
European
short-term borrowings
|
181
|
277
|
|||||
$
|
181
|
$
|
3,777
|
Payment
due by period
|
|
|||||||||||||||||||||
|
Year
1
|
Year
2
|
Year
3
|
Year
4
|
Year
5
|
Thereafter
|
Total
|
|||||||||||||||
Long-term
debt obligations
|
$
|
2,479
|
$
|
3,325
|
$
|
2,733
|
$
|
2,182
|
$
|
54,735
|
$
|
17
|
$
|
65,471
|
||||||||
Interest
obligation on long-term debt
|
1,353
|
1,189
|
1,025
|
861
|
697
|
533
|
5,658
|
|||||||||||||||
Capital
lease obligations *
|
140
|
1,040
|
761
|
342
|
—
|
—
|
2,283
|
|||||||||||||||
Operating
lease obligations
|
3,810
|
3,479
|
2,500
|
1,694
|
2,825
|
2,185
|
16,493
|
|||||||||||||||
Deferred
acquisition payments
|
1,958
|
—
|
—
|
—
|
—
|
1,958
|
||||||||||||||||
Short-term
debt
|
181
|
—
|
—
|
—
|
—
|
—
|
181
|
|||||||||||||||
Total
|
$
|
9,921
|
$
|
9,033
|
$
|
7,019
|
$
|
5,079
|
$
|
58,257
|
$
|
2,735
|
$
|
92,044
|
|
|
|
|
Measurement
Specialties, Inc.
(Registrant)
|
|
|
|
|
Date: February
7, 2007
|
By:
|
/s/
Frank D. Guidone
|
|
Frank
D. Guidone
|
|
|
President,
Chief Executive Officer and
Chief
Financial Officer (Acting)
(authorized
officer and principal financial
officer)
|
EXHIBIT
NUMBER
|
DESCRIPTION
|
|
|
|
|
31.1
|
Certification
of Frank D. Guidone required by Rule 13a-14(a) or Rule
15d-14(a)
|
|
|
|
|
31.2
|
Certification
of Frank D. Guidone required by Rule 13a-14(a) or Rule
15d-14(a)
|
|
|
|
|
32.1
|
Certification
of Frank D. Guidone required by Rule 13a-14(b) or Rule 15d-14(b)
and
Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section
1350
|