x
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
¨
|
TRANSITION REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
Delaware
|
36-4151663
|
(State
or other jurisdiction of incorporation or
organization)
|
(I.R.S.
Employer Identification No.)
|
10201
North Loop East
Houston,
Texas
|
77029
|
(Address
of principal executive offices)
|
(Zip
Code)
|
Large
Accelerated Filer ¨
|
Accelerated
Filer x
|
Non-Accelerated
Filer ¨
|
Smaller
Reporting Company ¨
|
2
|
|
2
|
|
3
|
|
4
|
|
5
|
|
|
|
7
|
|
7
|
|
9
|
|
10
|
|
11
|
|
12
|
|
12
|
|
|
|
12
|
|
|
|
12
|
|
|
|
|
|
|
|
12
|
|
13
|
|
13
|
|
|
|
14
|
March
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
(unaudited)
|
||||||||
Assets
|
||||||||
Current
assets:
|
||||||||
Accounts
receivable, net
|
$ | 55,831 | $ | 58,202 | ||||
Inventories,
net
|
69,554 | 69,299 | ||||||
Deferred
income taxes
|
1,344 | 1,054 | ||||||
Prepaid
expenses
|
1,025 | 832 | ||||||
Income
taxes
|
— | 2,004 | ||||||
Total
current assets
|
127,754 | 131,391 | ||||||
Property
and equipment, net
|
3,223 | 3,234 | ||||||
Goodwill
|
2,996 | 2,996 | ||||||
Deferred
income taxes
|
1,513 | 1,356 | ||||||
Other
assets
|
112 | 114 | ||||||
Total
assets
|
$ | 135,598 | $ | 139,091 | ||||
Liabilities
and stockholders' equity
|
||||||||
Current
liabilities:
|
||||||||
Book
overdraft
|
$ | 1,889 | 3,854 | |||||
Trade
accounts payable
|
13,676 | 12,297 | ||||||
Accrued
and other current liabilities
|
11,457 | 17,263 | ||||||
Income
taxes payable
|
2,529 | — | ||||||
Total
current liabilities
|
29,551 | 33,414 | ||||||
Long
term obligations
|
39,277 | 34,507 | ||||||
Stockholders'
equity:
|
||||||||
Common
stock, $0.001 par value; 100,000,000 shares authorized: 20,988,952 shares
issued and 17,858,550 outstanding at March 31, 2008 and 20,988,952 issued
and 18,577,727 outstanding at December 31, 2007
|
21 | 21 | ||||||
Additional
paid-in-capital
|
54,691 | 54,131 | ||||||
Retained
earnings
|
62,934 | 57,846 | ||||||
Treasury
stock
|
(50,876 | ) | (40,828 | ) | ||||
Total
stockholders' equity
|
66,770 | 71,170 | ||||||
Total
liabilities and stockholders' equity
|
$ | 135,598 | $ | 139,091 |
Three
Months Ended
March
31,
|
||||||||
2008
|
2007
|
|||||||
Sales
|
$ | 89,441 | $ | 81,788 | ||||
Cost
of sales
|
66,774 | 59,179 | ||||||
Gross
profit
|
22,667 | 22,609 | ||||||
Operating
Expenses:
|
||||||||
Salaries
and commissions
|
6,076 | 5,678 | ||||||
Other
operating expenses
|
4,984 | 4,766 | ||||||
Depreciation
and amortization
|
127 | 110 | ||||||
Total
operating expenses
|
11,187 | 10,554 | ||||||
Operating
income
|
11,480 | 12,055 | ||||||
Interest
expense
|
541 | 185 | ||||||
Income
before income taxes
|
10,939 | 11,870 | ||||||
Income
taxes
|
4,202 | 4,573 | ||||||
Net
income
|
$ | 6,737 | $ | 7,297 | ||||
Earnings
per share:
|
||||||||
Basic
|
$ | 0.37 | $ | 0.35 | ||||
Diluted
|
$ | 0.37 | $ | 0.35 | ||||
Weighted
average common shares outstanding:
|
||||||||
Basic
|
18,081,809 | 20,868,027 | ||||||
Diluted
|
18,121,280 | 20,996,579 | ||||||
Dividends
declared per share
|
$ | 0.085 | $ | — |
Three
Months Ended March 31,
|
||||||||
2008
|
2007
|
|||||||
Operating
activities
|
||||||||
Net
income
|
$ | 6,737 | $ | 7,297 | ||||
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
||||||||
Depreciation
and amortization
|
127 | 110 | ||||||
Amortization
of capitalized loan costs
|
20 | 16 | ||||||
Amortization
of unearned stock compensation
|
519 | 290 | ||||||
Provision
for returns and allowances
|
(11 | ) | (116 | ) | ||||
Provision
for inventory obsolescence
|
(6 | ) | 16 | |||||
Deferred
income taxes
|
(447 | ) | (211 | ) | ||||
Changes
in operating assets and liabilities:
|
||||||||
Accounts
receivable
|
2,382 | 1,163 | ||||||
Inventories
|
(249 | ) | (7,468 | ) | ||||
Prepaid
expenses
|
(193 | ) | (589 | ) | ||||
Other
assets
|
(18 | ) | 3 | |||||
Book
overdraft
|
(1,965 | ) | 2,190 | |||||
Trade
accounts payable
|
1,379 | 2,793 | ||||||
Accrued
and other current liabilities
|
(5,806 | ) | (1,390 | ) | ||||
Income
taxes payable/receivable
|
4,533 | 3,685 | ||||||
Net
cash provided by operating activities
|
7,002 | 7,789 | ||||||
Investing
activities
|
||||||||
Expenditures
for property, plant, and equipment
|
(116 | ) | (96 | ) | ||||
Net
cash used in investing activities
|
(116 | ) | (96 | ) | ||||
Financing
activities
|
||||||||
Borrowings
on revolver
|
91,157 | 75,494 | ||||||
Payments
on revolver
|
(86,387 | ) | (83,766 | ) | ||||
Proceeds
from exercise of stock options
|
18 | 31 | ||||||
Excess
tax benefit for stock options
|
41 | 548 | ||||||
Payment
of dividends
|
(1,527 | ) | — | |||||
Purchase
of treasury stock
|
(10,188 | ) | — | |||||
Net
cash used in financing activities
|
(6,886 | ) | (7,693 | ) | ||||
Net
change in cash
|
— | — | ||||||
Cash
at beginning of period
|
— | — | ||||||
Cash
at end of period
|
$ | — | $ | — |
Three
Months Ended
March
31,
|
||||||||
2008
|
2007
|
|||||||
Weighted
average common shares for basic earning per share
|
18,082 | 20,868 | ||||||
Effect
of dilutive securities
|
39 | 129 | ||||||
Denominator
of diluted earnings per share
|
18,121 | 20,997 |
2008
|
2007
|
||
Expected
volatility
|
68%
|
42%
|
|
Expected
life in years
|
5.5
years
|
5.5
years
|
|
Risk-free
interest rate
|
3.82%
|
4.59%
|
|
Dividend
yield
|
2.50%
|
0%
|
|
·
|
continuous
and interlocked armor cable (cable encapsulated in either a seamless or
interlocked aluminum protective
sheath);
|
|
·
|
control
and power cable (single or multiple conductor industrial
cable);
|
|
·
|
electronic
wire and cable (computer, audio and signal
cable);
|
|
·
|
flexible
and portable cords (flexible, heavy duty industrial
cable);
|
|
·
|
instrumentation
and thermocouple cable (cables used for transmitting signals for
instruments and heat sensing
devices);
|
|
·
|
lead
and high temperature cable (single conductor cable used for low or high
temperature applications);
|
|
·
|
medium
voltage cable (cables used for applications between 2,001 volts and 35,000
volts); and
|
|
·
|
premise
and category wire and cable (cable used for home and high speed data
applications).
|
Three
Months Ended
March
31,
|
||||||||
2008
|
2007
|
|||||||
Sales
|
100.0 | % | 100.0 | % | ||||
Cost
of sales
|
74.7 | % | 72.4 | % | ||||
Gross
profit
|
25.3 | % | 27.6 | % | ||||
Operating
expenses:
|
||||||||
Salaries
and commissions
|
6.8 | % | 6.9 | % | ||||
Other
operating expenses
|
5.6 | % | 5.8 | % | ||||
Depreciation
and amortization
|
0.1 | % | 0.1 | % | ||||
Total
operating expenses
|
12.5 | % | 12.9 | % | ||||
Operating
income
|
12.8 | % | 14.7 | % | ||||
Interest
expense
|
0.6 | % | 0.2 | % | ||||
Income
before income taxes
|
12.2 | % | 14.5 | % | ||||
Income
tax provision
|
4.7 | % | 5.6 | % | ||||
Net
income
|
7.5 | % | 8.9 | % |
Three
Months Ended
|
||||||||||||||||
March
31,
|
||||||||||||||||
(in
millions)
|
2008
|
2007
|
Change
|
|||||||||||||
Sales
|
$ | 89.4 | $ | 81.8 | $ | 7.7 | 9.4 | % |
Three
Months Ended
|
||||||||||||||||
March
31,
|
||||||||||||||||
(in
millions)
|
2008
|
2007
|
Change
|
|||||||||||||
Gross
profit
|
$ | 22.7 | $ | 22.6 | $ | 0.1 | 0.3 | % | ||||||||
Gross
profit as a percent of sales
|
25.3 | % | 27.6 | (2.3 | ) |
Three
Months Ended
|
||||||||||||||||
March
31,
|
||||||||||||||||
(in
millions)
|
2008
|
2007
|
Change
|
|||||||||||||
Operating
expenses:
|
||||||||||||||||
Salaries
and commissions
|
$ | 6.1 | $ | 5.7 | $ | 0.4 | 7.0 | % | ||||||||
Other
operating expenses
|
5.0 | 4.8 | 0.2 | 4.6 | % | |||||||||||
Depreciation
and amortization
|
0.1 | 0.1 | 0.0 | 15.5 | % | |||||||||||
Total
operating expenses
|
$ | 11.2 | $ | 10.6 | $ | 0.6 | 6.0 | % | ||||||||
Operating
expenses as a % of sales
|
12.5 | % | 12.9 | % | (0.4 | )% |
|
•
|
the
adequacy of available bank lines of
credit;
|
|
•
|
the
ability to attract long-term capital with satisfactory
terms;
|
|
•
|
additional
stock repurchases;
|
|
•
|
cash
flows generated from operating
activities;
|
|
•
|
payment
of dividends;
|
|
•
|
capital
expenditures and
|
|
•
|
acquisitions.
|
Total
|
Less
than
1
year
|
1-3
years
|
3-5
years
|
More
than
5
years
|
||||||||||||||||
(In
thousands)
|
||||||||||||||||||||
Term
loans and loans payable
|
$ | 39,277 | $ | — | $ | 39,277 | $ | — | $ | — |
Period
|
Total
number of shares purchased
|
Average
price paid per share
|
Total number of shares purchased
as part of publicly announced plans or programs (1)
|
Maximum
dollar value that may yet be used for purchases under the
plan
|
||||||||||||
January
1 – 31, 2008
|
465,189 | $ | 13.31 | 465,189 | $ | 27,918,975 | ||||||||||
February
1 – 29, 2008
|
239,673 | $ | 15.31 | 239,673 | $ | 24,249,159 | ||||||||||
March
1 – 31, 2008
|
22,940 | $ | 14.24 | 22,940 | $ | 23,922,451 | ||||||||||
Total
|
727,802 | $ | 14.00 | 727,802 |
Exhibit
Number
|
Document
Description
|
|
31.1
|
Certification
by Charles A. Sorrentino pursuant to Rule 13a-14(a) and 15d-14(a), as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
|
|
31.2
|
Certification
by Nicol G. Graham pursuant to Rule 13a-14(a) and 15d-14(a), as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
|
|
32.1
|
Certification
by Charles A. Sorrentino and Nicol G. Graham pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|
Date: May
12, 2008
|
HOUSTON
WIRE & CABLE COMPANY
|
BY: /s/
Nicol G. Graham
|
|
Nicol G. Graham,
Chief Financial Officer
|
Exhibit
Number
|
Document
Description
|
|
Certification
by Charles A. Sorrentino pursuant to Rule 13a-14(a) and 15d-14(a), as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
|
||
|
||
Certification
by Nicol G. Graham pursuant to Rule 13a-14(a) and 15d-14(a), as adopted
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
|
||
Certification
by Charles A. Sorrentino and Nicol G. Graham pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002.
|