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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934 for the quarterly period ended March 31, 2004.
Commission file number: 0-20206
PERCEPTRON, INC.
(Exact Name of Registrant as Specified in Its Charter)
Michigan 38-2381442
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
47827 Halyard Drive, Plymouth, Michigan 48170-2461
(Address of Principal Executive Offices) (Zip Code)
(734) 414-6100
(Registrant's Telephone Number, Including Area Code)
Not Applicable
(Former Name, Former Address and Former Fiscal Year, if Changed Since
Last Report)
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 [ ]
Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act).
Yes [ ] No [X]
The number of shares outstanding of each of the issuer's classes of common stock
as of May 7, 2004, was:
Common Stock, $0.01 par value 8,710,309
----------------------------- -----------------
Class Number of shares
PERCEPTRON, INC. AND SUBSIDIARIES
INDEX TO FORM 10-Q
FOR THE QUARTER ENDED MARCH 31, 2004
PAGE
NUMBER
------
COVER 1
INDEX 2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements 3
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 10
Item 3. Quantitative and Qualitative Disclosures about Market Risk 17
Item 4. Controls and Procedures 18
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 18
Item 6. Exhibits and Reports on Form 8-K 19
SIGNATURES 19
2
PERCEPTRON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
THREE MONTHS ENDED NINE MONTHS ENDED
MARCH 31, MARCH 31,
(In Thousands, Except Per Share Amounts) 2004 2003 2004 2003
------------ ------------ ------------ ------------
NET SALES $ 12,359 $ 15,967 $ 38,234 $ 39,495
COST OF SALES 6,639 6,677 20,416 18,699
------------ ------------ ------------ ------------
GROSS PROFIT 5,720 9,290 17,818 20,796
------------ ------------ ------------ ------------
OPERATING EXPENSES
Selling, general and administrative 2,897 3,095 8,597 8,937
Engineering, research and development 1,660 1,597 4,762 4,631
Other expense 166 - 166 -
------------ ------------ ------------ ------------
Total operating expenses 4,723 4,692 13,525 13,568
------------ ------------ ------------ ------------
OPERATING INCOME 997 4,598 4,293 7,228
------------ ------------ ------------ ------------
OTHER INCOME AND (DEDUCTIONS)
Interest expense (1) - (1) (151)
Interest income 54 22 194 105
Arbitration Charge (Note 8) - (2,370) - (2,370)
Foreign currency and other (5) 61 747 (8)
------------ ------------ ------------ ------------
Total other income and (deductions) 48 (2,287) 940 (2,424)
------------ ------------ ------------ ------------
INCOME BEFORE INCOME TAXES 1,045 2,311 5,233 4,804
INCOME TAX EXPENSE 537 1,502 2,168 2,573
------------ ------------ ------------ ------------
NET INCOME $ 508 $ 809 $ 3,065 $ 2,231
============ ============ ============ ============
EARNINGS PER COMMON SHARE
Basic $ 0.06 $ 0.10 $ 0.36 $ 0.27
Diluted $ 0.05 $ 0.09 $ 0.33 $ 0.26
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
Basic 8,647 8,309 8,554 8,269
Dilutive effect of stock options 757 380 757 165
------------ ------------ ------------ ------------
Diluted 9,404 8,689 9,311 8,434
============ ============ ============ ============
The notes to the consolidated financial statements are an integral part of these
statements.
3
PERCEPTRON, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
MARCH 31, JUNE 30,
In Thousands, Except Per Share Amount) 2004 2003
----------- -----------
(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 21,546 $ 11,101
Receivables:
Billed receivables, net of allowance for doubtful accounts 14,679 22,955
of $517 and $674, respectively
Unbilled receivables 888 1,170
Other receivables 439 1,474
Inventories, net of reserves of $559 and $569, respectively 6,570 6,809
Deferred taxes and other current assets 1,531 1,365
----------- -----------
Total current assets 45,653 44,874
----------- -----------
PROPERTY AND EQUIPMENT
Building and land 6,013 6,004
Machinery and equipment 9,715 9,682
Furniture and fixtures 1,068 1,063
----------- -----------
16,796 16,749
Less - Accumulated depreciation and amortization (8,721) (8,459)
----------- -----------
Net property and equipment 8,075 8,290
----------- -----------
DEFERRED TAX ASSET 6,054 6,250
----------- -----------
TOTAL ASSETS $ 59,782 $ 59,414
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 2,086 $ 1,754
Accrued liabilities and expenses 2,550 5,051
Deferred revenue 1,685 1,098
Income taxes payable 2,500 2,859
Accrued compensation 1,563 3,707
----------- -----------
Total current liabilities 10,384 14,469
----------- -----------
SHAREHOLDERS' EQUITY
Preferred stock - no par value, authorized 1,000 shares, issued none - -
Common stock, $0.01 par value, authorized 19,000 shares, issued
and outstanding 8,706 and 8,342, respectively 87 83
Accumulated other comprehensive loss (764) (961)
Additional paid-in capital 42,468 41,281
Retained earnings 7,607 4,542
----------- -----------
Total shareholders' equity 49,398 44,945
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 59,782 $ 59,414
=========== ===========
The notes to the consolidated financial statements are an integral part of these
statements.
4
PERCEPTRON, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
(UNAUDITED)
NINE MONTHS ENDED
MARCH 31,
(In Thousands) 2004 2003
------------ ----------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 3,065 $ 2,231
Adjustments to reconcile net income
to net cash provided from operating activities:
Depreciation and amortization 974 972
Stock option income tax benefit 359 -
Deferred income taxes 195 221
Other 15 (9)
Changes in assets and liabilities, exclusive of changes shown
separately 5,448 4,544
----------- ----------
Net cash provided from operating activities 10,056 7,959
----------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES
Revolving credit borrowings - 11,121
Revolving credit repayments - (16,954)
Repayment of long-term debt - (1,040)
Proceeds from stock plans 831 105
----------- ----------
Net cash provided from (used for) financing activities 831 (6,768)
----------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (931) (706)
----------- ----------
Net cash used for investing activities (931) (706)
----------- ----------
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS 489 486
----------- ----------
NET INCREASE IN CASH AND CASH EQUIVALENTS 10,445 971
CASH AND CASH EQUIVALENTS, JULY 1 11,101 8,143
----------- ----------
CASH AND CASH EQUIVALENTS, MARCH 31 $ 21,546 $ 9,114
=========== ==========
CHANGES IN ASSETS AND LIABILITIES, EXCLUSIVE OF CHANGES SHOWN SEPARATELY
Receivables, net $ 10,263 $ 427
Inventories, net 239 (525)
Accounts payable 332 (1,108)
Other current assets and liabilities (5,386) 5,750
----------- ----------
$ 5,448 $ 4,544
=========== ==========
The notes to the consolidated financial statements are an integral part of these
statements.
5
PERCEPTRON, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF PRESENTATION
The accompanying consolidated financial statements should be read in conjunction
with the Company's 2003 Annual Report on Form 10-K. Certain reclassifications
may have been made to the prior year's financial statements to conform with the
fiscal year 2004 presentation. In the opinion of management, the unaudited
information furnished herein reflects all adjustments necessary, including
normal recurring adjustments, for a fair presentation of the financial
statements for the periods presented. The results of operations for any interim
period are not necessarily indicative of the results of operations for a full
year.
2. INVENTORY
Inventory is stated at the lower of cost or market. The cost of inventory is
determined by the first-in, first-out ("FIFO") method. The Company provides a
reserve for obsolescence to recognize the effects of engineering change orders
and other matters that affect the value of the inventory. When the related
inventory is disposed of, the obsolescence reserve is released. During the nine
months ended March 31, 2004, the Company disposed of $111,000 of inventory that
had been reserved for at June 30, 2003 and accrued approximately an additional
$101,000 for anticipated obsolete inventory. Inventory, net of reserves at March
31, 2004 and June 30, 2003 of $559,000 and $569,000, respectively, is comprised
of the following (in thousands):
MARCH 31, JUNE 30,
2004 2003
--------- --------
Component Parts $ 3,331 $ 3,525
Work In Process 551 516
Finished Goods 2,688 2,768
--------- --------
Total $ 6,570 $ 6,809
========= ========
3. EARNINGS PER SHARE
Basic earnings per share ("EPS") is calculated by dividing net income by the
weighted average number of common shares outstanding during the period. Other
obligations, such as stock options, are considered to be potentially dilutive
common shares. Diluted EPS assumes the issuance of potentially dilutive common
shares outstanding during the period and adjusts for any changes in income and
the repurchase of common shares that would have occurred from the assumed
issuance, unless such effect is anti-dilutive.
Options to purchase 567,000 and 1,039,000 shares of common stock outstanding in
the three months ended March 31, 2004 and 2003, respectively, were not included
in the computation of diluted EPS because the effect would have been
anti-dilutive. Options to purchase 526,000 and 1,116,000 shares of common stock
were outstanding in the nine months ended March 31, 2004 and 2003, respectively,
and were not included in the computation of diluted EPS because the effect would
have been anti-dilutive.
4. FOREIGN EXCHANGE CONTRACTS
The Company may use, from time to time, a limited hedging program to minimize
the impact of foreign currency fluctuations. These transactions involve the use
of forward contracts that typically mature
6
within one year and are designed to hedge anticipated foreign currency
transactions. The Company may use forward exchange contracts to hedge the net
assets of certain of its foreign subsidiaries to offset the translation and
economic exposures related to the Company's investment in these subsidiaries.
Changes in the fair value of these contracts are included in other comprehensive
income until they are recognized in earnings at the time the forecasted
transaction occurs.
At March 31, 2004 the Company had forward exchange contracts between the United
States Dollar and the Euro in the notional amount of approximately $11.0
million. The forward exchange contracts are accounted for as cash flow hedges
and have a weighted average settlement price of 1.17 Euros to the United States
Dollar. The Company's forward exchange contracts do not subject it to material
risk due to exchange rate movements because gains and losses on these contracts
offset losses and gains on the assets, liabilities, and transactions being
hedged.
At March 31, 2003, the Company had forward exchange contracts between the U.S.
Dollar and the Euro in the notional amount of $3.0 million that matured on
December 30, 2003.
5. COMPREHENSIVE INCOME
Comprehensive income is defined as the change in common shareholder's equity
during a period from transactions and events from non-owner sources, including
net income. Other items of comprehensive income include revenues, expenses,
gains and losses that are excluded from net income. Total comprehensive income
for the applicable periods is as follows (in thousands):
THREE MONTHS ENDED MARCH 31, 2004 2003
--------- --------
Net Income $ 508 $ 809
Other Comprehensive Income:
Foreign Currency Translation Adjustments (532) 412
Forward Contracts 394 (29)
--------- ---------
Total Comprehensive Income $ 370 $ 1,192
========= =========
NINE MONTHS ENDED MARCH 31, 2004 2003
--------- ---------
Net Income $ 3,065 $ 2,231
Other Comprehensive Income:
Foreign Currency Translation Adjustments 1,002 1,169
Forward Contracts (805) (29)
--------- ---------
Total Comprehensive Income $ 3,262 $ 3,371
========= =========
6. CREDIT FACILITIES
The Company has a $7.5 million collateral-based Credit Agreement with
Comerica Bank, which expires on November 1, 2005. Proceeds under the Credit
Agreement may be used for working capital and capital expenditures. The
collateral for the loan is substantially all U.S. assets of the Company.
Borrowings are designated as a Prime-based Advance or as a Eurodollar-based
Advance. Interest on Prime-based advances is payable on the last day of each
month and is calculated daily at a rate that ranges from a 1/2% below to a 1/4%
above the bank's prime rate (4.00% as of March 31, 2004) dependent upon the
Company's ratio of funded debt to earnings before interest, taxes, depreciation
and amortization ("EBITDA"). Interest on Eurodollar-based Advances is calculated
at a specific margin above the Eurodollar Rate offered at the time and for the
period chosen (approximately 3.0% as of March
7
31, 2004) dependent upon the Company's ratio of funded debt to EBITDA and is
payable on the last day of the applicable period. Quarterly, the Company pays a
commitment fee on the daily unused portion of the Credit Agreement based on a
percentage dependent upon the Company's ratio of funded debt to EBITDA. The
aggregate principal amount outstanding at any one time cannot exceed the lesser
of $7.5 million or the borrowing base which is comprised of 80% of eligible
accounts receivable billed in the United States, aged up to 180 days, plus the
lesser of 25% of raw material located in the United States or $2.0 million, plus
the lesser of 50% of finished goods inventory or $750,000 plus $4.2 million
representing 60% of the appraised value of the Company's real property located
in Plymouth, Michigan. The Credit Agreement prohibits the Company from paying
dividends without the prior written consent of the bank. In addition, the Credit
Agreement requires the Company to maintain a Tangible Net Worth, as defined in
the Credit Agreement, of not less than $32.2 million as of March 31, 2004. The
borrowing base at March 31, 2004 was $7.5 million with no borrowings
outstanding.
At March 31, 2004, the Company's German subsidiary (GmbH) had an unsecured
credit facility totaling 500,000 Euros. The facility may be used to finance
working capital needs and equipment purchases or capital leases. Any borrowings
for working capital needs will bear interest at 9.0% on the first 100,000 Euros
of borrowings and 2.0% for borrowings over 100,000 Euros. The German credit
facility is cancelable at any time by either GmbH or the bank and any amounts
then outstanding would become immediately due and payable. At March 31, 2004,
GmbH had no borrowings outstanding. The facility supported outstanding letters
of credit totaling 289,000 Euros.
7. STOCK BASED COMPENSATION
The Company has stock option plans, which are described more fully in Note 13 in
the Company's 2003 Annual Report. The Company applies APB Opinion No. 25 ("APB
25"), "Accounting for Stock Issued to Employees," and related interpretations in
accounting for these plans. Accordingly, compensation cost for stock options has
been recognized under the provisions of APB 25. No stock-based compensation cost
is reflected in net income, as all options granted under these plans had an
exercise price greater than or equal to the market value of the underlying
common stock on the date of grant. The following table illustrates the pro forma
effect on net income and earnings per share for the periods indicated if the
Company had applied the fair value recognition provisions of FASB Statement 123,
"Accounting for Stock-Based Compensation," to its stock option plans as
indicated below (in thousands except per share amounts):
THREE MONTHS THREE MONTHS NINE MONTHS NINE MONTHS
ENDED ENDED ENDED ENDED
MARCH 31, 2004 MARCH 31, 2003 MARCH 31, 2004 MARCH 31, 2003
-------------- -------------- -------------- --------------
Net Income
As Reported $ 508 $ 809 $ 3,065 $ 2,231
Pro Forma $ 378 $ 724 $ 2,713 $ 1,968
Earnings Per Share - Diluted
As Reported $ 0.05 $ 0.09 $ 0.33 $ 0.26
Pro Forma $ 0.04 $ 0.08 $ 0.29 $ 0.23
8
The estimated fair value as of the date options were granted during the periods
presented, using the Black-Scholes option-pricing model, was as follows:
THREE MONTHS THREE MONTHS NINE MONTHS NINE MONTHS
ENDED ENDED ENDED ENDED
MARCH 31, 2004 MARCH 31, 2003 MARCH 31, 2004 MARCH 31, 2003
-------------- -------------- -------------- --------------
Weighted Average Estimated Fair
Value Per Share Of Options Granted $ 4.26 $ 1.50 $ 4.49 $ 1.23
During The Period
Assumptions:
Amortized Dividend Yield - - - -
Common Stock Price Volatility 26.32% 67.22% 64.91% 85.57%
Risk Free Rate Of Return 3.38% 3.00% 3.20% 3.00%
Expected Option Term (in years) 5 5 5 5
8. COMMITMENTS AND CONTINGENCIES
Management is currently unaware of any significant pending litigation affecting
the Company, other than the matters set forth below. See the Company's 2003
Annual Report on Form 10-K for a more detailed discussion regarding certain of
these matters.
On March 15, 2004, the Company entered into a Settlement Agreement with MERILab,
Inc. and others that resolved the suit filed by MERILab against the Company in
the United States District Court for the District of Colorado that is discussed
more fully in the Company's Form 10-K for the year ended June 30, 2003 under
Item 3, "Legal Proceedings". As part of the settlement, MERILab and the Company
entered into a supply agreement pursuant to which the Company will supply
sensors to MERILab and the Company agreed to license to MERILab certain
intellectual property that was the subject of the dispute.
As previously disclosed in the Company's Form 10-Q for the quarter ended
September 30, 2003, on October 15, 2003, the Company entered into a Settlement
Agreement ("Agreement") with LMI Technologies, Inc. ("LMI"), Diffracto Limited,
Sensor Adaptive Machines, Inc., Leonard Metcalfe, Neil Hummel and others that
resolved all pending litigation matters between the parties. The Agreement
settled the May 10, 2002 action the Company commenced against LMI et al. in the
Ontario Superior Court of Justice-Commercial List, the February 21, 2003 suit
filed by the Company against LMI in the United States District Court for the
Eastern District of Michigan and the May 30, 2003 suit filed by LMI against the
Company in the United States District Court for the Eastern District of Michigan
that are discussed more fully in the Company's Form 10-K for the year ended June
30, 2003 under Item 3, "Legal Proceedings". As part of the settlement, LMI
agreed to pay the Company a cash settlement and the parties agreed to cross
license certain intellectual property, including intellectual property that was
the subject of the disputes.
The arbitration charge of $2.4 million in the third quarter of fiscal 2003 was
due to the arbitration award against the Company's wholly-owned subsidiary
Perceptron B.V that is discussed more fully in the Company's Form 10-K for the
year ended June 30, 2003 under Item 3, "Legal Proceedings". As previously
disclosed in the Company's Form 10-Q for the quarter ended December 31, 2003, on
December 24, 2003, the Company entered into a Compromise and Settlement
Agreement with Speroni S.p.A. that resolved the arbitration award. As a result
of the settlement, on December 24, 2003, the Company paid Speroni S.p.A.
approximately $2.3 million.
As previously disclosed in the Company's Annual Report on Form 10-K for the year
ended June 30, 2003 under Item 3, "Legal Proceedings", the Company is a party to
a suit filed by Industries GDS, Inc., Bois Granval GDS Inc., and Centre de
Preparation GDS, Inc. (collectively, "GDS") on or about November 21,
9
2002 in the Superior Court of the Judicial District of Quebec, Canada against
the Company, Carbotech, Inc. ("Carbotech"), and U.S. Natural Resources, Inc.
("USNR"), among others. The suit alleges that the Company breached its
contractual and warranty obligations as a manufacturer in connection with the
sale and installation of three systems for trimming and edging wood products.
The suit also alleges that Carbotech breached its contractual obligations in
connection with the sale of equipment and the installation of two trimmer lines,
of which the Company's systems were a part, and that USNR, which acquired
substantially all of the assets of the forest products business unit from the
Company, was liable for GDS' damages. USNR has sought indemnification from the
Company under the terms of existing contracts between the Company and USNR. GDS
seeks compensatory damages against the Company, Carbotech and USNR of
approximately $4.9 million using a June 30, 2003 exchange rate. The Company
intends to vigorously defend GDS' claims.
The Company may, from time to time, be subject to other claims and suits in the
ordinary course of its business. To estimate whether a loss contingency should
be accrued by a charge to income, the Company evaluates, among other factors,
the degree of probability of an unfavorable outcome and the ability to make a
reasonable estimate of the amount of the loss. Since the outcome of litigation
is subject to significant uncertainty, changes in these factors could materially
impact the Company's financial position or results of operations.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2004 COMPARED TO THREE MONTHS ENDED MARCH 31, 2003
Overview - Perceptron, Inc. ("Perceptron" or the "Company") designs, develops,
manufactures and markets information-based measurement and inspection solutions
for process improvement. Perceptron's product offerings are designed to improve
quality, increase productivity and decrease costs in manufacturing and product
development. The solutions offered by the Company are divided into three groups:
1) The Automated Systems Group made up of AutoGauge(R), AutoFit(R), AutoScan(R),
AutoSpect(R) and AutoGuide(R); 2) The Technology Components Group made up of
ScanWorks(TM), WheelWorks(R) (Non-Contact Wheel Alignment) and sensors for the
forest products industry; and 3) The Value Added Services Group providing
consulting, training and non-warranty support services.
The Company's current principal products are based upon proprietary
three-dimensional image processing, AutoSolve(TM) feature extraction software
algorithms and TriCam(R) three-dimensional object imaging technology. TriCam(R)
technology uses structured laser light and triangulation techniques to obtain
accurate three-dimensional measurements. TriCam(R) systems are used to measure
formed parts for reduction of process variation, to provide robot guidance for
automated assembly tasks and to improve the speed and lower the cost of wheel
alignment in final assembly operations.
The Company reported net income of $508,000, or $0.06 per share, for the third
quarter of fiscal 2004, compared to net income of $809,000 or $0.10 per share,
in the third quarter ended March 31, 2003.
Sales - Net sales of $12.4 million for the third quarter of fiscal 2004 were
down $3.6 million, compared with the same period one year ago principally due to
the higher than normal European sales last year. Sales of the Company's
Automated Systems Group were $8.6 million compared to $13.1 million last year.
Sales of the Technology Components Group were $2.4 million compared to $1.8
million last year. Value Added Services sales were $1.4 million compared to $1.1
million last year. Sales by geographic region were as follows: North America
sales were approximately $5.6 million this year compared to $5.4 million last
year, European sales were approximately $6.4 million this year compared to $10.1
million
10
last year, and Asian sales were approximately $400,000 this year compared to
$500,000 last year. The lower sales in Europe resulted primarily from lower
Automated Systems sales that were down approximately $4.2 million compared to
last year when AutoGauge(R) systems associated with a customer's major new
vehicle tooling program were delivered to a number of its plants in Europe. The
European sales decrease from last year was partially offset by the strong Euro
that based on conversion rates in effect this quarter added approximately
$800,000 more in sales than the comparable rates in the third quarter of fiscal
2003 would have yielded. The balance of the sales change in both North America
and Europe was primarily a function of the timing of customer orders.
Bookings & Backlog - The Company had new order bookings during the quarter of
$15.0 million compared with new order bookings of $12.4 million in the second
quarter of fiscal 2004 and $14.0 million for the third quarter of fiscal 2003.
New orders for the Automated Systems Group were $12.1 million compared to $11.2
million last year. Orders for the Technology Components Group were $1.8 million
compared to $2.0 million last year. Orders for the Value Added Services Group
were $1.1 million compared to $.9 million for last year. The Company's backlog
was $19.3 million as of March 31, 2004 compared with $16.6 million as of
December 31, 2003 and $18.6 million as of March 31, 2003. The Company expects to
be able to fill substantially all of the orders in backlog during the following
twelve months. The amount of new order bookings and the level of backlog during
any particular period are not necessarily indicative of the future operating
performance of the Company.
Gross Profit - Gross profit was $5.7 million, or 46.3% of sales, in the third
quarter of fiscal year 2004, as compared to $9.3 million, or 58.2% of sales, in
the third quarter of fiscal year 2003. The gross profit reduction of $3.6
million from last year was primarily due to loss of incremental gross profit
related to the lower level of sales this year. Manufacturing and installation
costs, which are relatively fixed, were 27.1% of sales this quarter compared to
19.3 % in the same quarter last year when sales were much higher and were the
primary reason for the reduction in the gross profit margin percentage. The
gross profit margin percentage last year was also favorably impacted by the
recognition of deferred revenues in Europe related to customer buy-off on
completed system installations with nominal associated costs. Higher sales of
low margin forest product sensors this year also reduced the gross profit margin
percentage. The current period margin reductions were partially offset by the
incremental benefit from the strengthening Euro that had the effect of
increasing gross profit margins in Europe.
Selling, General and Administrative (SG&A) Expenses - SG&A expenses were $2.9
million in the quarter ended March 31, 2004 compared to $3.1 million in the
third quarter of fiscal 2003. The decrease primarily reflected lower accruals in
fiscal 2004 for the Company's allowance for doubtful accounts, Michigan single
business tax, and the employee profit sharing plan that were partially offset by
salary and benefit increases and the impact of the strong Euro on SG&A expenses
in the Company's European subsidiary.
Engineering, Research and Development (R&D) Expenses - Engineering and R&D
expenses of $1.7 million in the quarter ended March 31, 2004 were $63,000 higher
than the third quarter of fiscal 2003 due principally to salary and benefit
increases and spending on product development that were partially offset by
lower accruals for employee profit sharing.
Other Expense - Other expense this quarter included a $166,000 loss on the
disposition of a fixed asset.
Interest Income/Expense, net - Net interest income was $53,000 in the third
quarter of fiscal 2004 compared with net interest income of $22,000 in the third
quarter of fiscal 2003. The higher interest income this quarter is the result of
higher average cash balances available for investment in short term securities.
11
Arbitration Charge - The arbitration charge of $2.4 million in the third quarter
of fiscal 2003 was due to the arbitration award against the Company's
wholly-owned subsidiary Perceptron B.V. that is discussed more fully in the
Company's Form 10-K for the year ended June 30, 2003 under Item 3, "Legal
Proceeding". On December 24, 2003, the Company entered into a Compromise and
Settlement Agreement with Speroni S.p.A. that resolved the arbitration award. As
a result of the settlement, on December 24, 2003, the Company paid Speroni
S.p.A. approximately $2.3 million.
Foreign Currency and Other - There was a net foreign currency loss of $18,000
during the third quarter of fiscal 2004 compared with a net foreign currency
gain of $58,000 during the same period last year.
Income Taxes - Income tax expense for the three-month periods ended March 31,
2004 and 2003 reflected the mix of operating profit and loss among the Company's
various operating entities and their countries' respective tax rates.
Outlook - In the near term the Company expects fourth quarter fiscal year 2004
results to be at least comparable to third quarter fiscal year 2004. The
Company's sales forecast for the year as a whole is expected to be in the range
of $50 million to $52 million, depending in part upon the relative strength of
the dollar against the Euro. As previously reported, in the longer term the
automotive industry's current focus on introducing new vehicles more frequently
to satisfy their customers' changing requirements is a positive indicator for
the Company's future rate of new orders. The foregoing statements are
"forward-looking statements" within the meaning of the Securities Exchange Act
of 1934, as amended. See Item 2 "Management's Discussion and Analysis of
Financial Condition and Results of Operations - Safe Harbor Statement" for a
discussion of a number of uncertainties which could cause actual results to
differ materially from those set forth in the forward-looking statements.
NINE MONTHS ENDED MARCH 31, 2004, COMPARED TO NINE MONTHS ENDED MARCH 31, 2003
Overview - The Company reported net income of $3.1 million, or $0.36 per share,
for the nine months ended March 31, 2004, compared with net income of $2.2
million, or $0.27 per share for the nine months ended March 31, 2003.
Sales - Sales in the first nine months of fiscal 2004 were $38.2 million,
compared to $39.5 million for the nine months ended March 31, 2003. Sales of the
Company's Automated Systems Group were $26.7 million compared to $29.7 million
last year. Technology Components Group sales were $7.9 million compared to $6.3
million last year. Value Added Services Group sales were $3.6 million compared
to $3.5 million last year. Sales by geographic region were as follows: North
America sales were approximately $20.5 million this year compared to $19.3
million last year, European sales were approximately $15.6 million this year
compared to $18.5 million last year, and Asian sales were approximately $1.1
million this year compared to $1.7 million last year. The sales increase in
North America was spread over the Company's product lines. The sales decrease in
Europe resulted from lower Automated Systems sales that were down approximately
$3.8 million compared to last year when AutoGauge(R) systems associated with a
customer's major new vehicle tooling program were delivered to a number of its
plants in Europe. The European sales decrease was partially offset by the strong
Euro that based on conversion rates in effect for fiscal year 2004 added
approximately $2.1 million more in sales than the comparable rates for the same
period of fiscal 2003 would have yielded. The sales decrease in Asia was due to
the timing of customer orders.
12
Bookings & Backlog - New order bookings for the nine months ended March 31, 2004
were $39.4 million compared to $42.9 million for the same period one year ago.
New orders for the Automated Systems Group were $28.1 million compared to $34.5
million last year. The high level of orders last year was principally due to
bookings for $32.7 million of AutoGauge(R) systems of which $15.5 million was
placed by European Automotive manufacturers. Orders for the Technology
Components Group were $7.1 million compared to $5.7 million last year. Orders
for the Value Added Services Group were $4.2 million compared to $2.7 million
last year. Backlog at March 31, 2004 was $19.3 million compared to $18.6 million
at March 31, 2003. The Company expects to be able to fill substantially all of
the orders in backlog during the following twelve months. The amount of new
order bookings and the level of backlog during any particular period are not
necessarily indicative of the future operating performance of the Company.
Gross Profit - Gross profit was $17.8 million, or 46.6% of sales, for the nine
months ended March 31, 2004, as compared to $20.8 million, or 52.6% of sales,
for the nine months ended March 31, 2003. The gross profit reduction of $3.0
from last year was primarily due to reduced incremental gross profit related to
the lower level of sales this year. Manufacturing and installation costs, were
25.5% of sales this nine-month period compared to 20.2 % last year when sales
were higher and were the primary reason for the reduction in the gross profit
margin percentage. The gross profit margin percentage last year was also
favorably impacted by the recognition of deferred revenues in Europe related to
customer buy-off on completed system installations with nominal associated
costs. The current period margin reductions were partially offset by the
incremental benefit from the strengthening Euro that had the effect of
increasing gross margins in Europe.
Selling, General and Administrative (SG&A) Expenses - SG&A expenses decreased
$340,000 to $8.6 million in the nine months ended March 31, 2004, compared with
last year. The decrease primarily reflected lower accruals for the Company's
allowance for doubtful accounts and the employee profit sharing plan that were
partially offset by salary and benefit increases and the impact of the strong
Euro on SG&A expenses in the Company's European subsidiary.
Engineering, Research and Development (R&D) Expenses - Engineering and R&D
expenses of $4.8 million in the nine months ended March 31, 2004 were $131,000
higher than in the nine months ended March 31, 2003 due principally to salary
and benefit increases and spending on product development that were partially
offset by lower accruals for employee profit sharing.
Other Expense - Other expense this year reflected a $166,000 loss on the
disposition of a fixed asset.
Interest Income/Expense, net - Net interest income was $193,000 in the nine
months ended March 31, 2004 compared with net interest expense of $46,000 in the
nine months ended March 31, 2003 reflecting the fact that the Company paid off
its revolving credit debt in February of 2003 and has remained debt free during
fiscal 2004.
Arbitration Charge - The arbitration charge of $2.4 million in fiscal 2003 was
due to the arbitration award against the Company's wholly-owned subsidiary
Perceptron B.V. that is discussed more fully in the Company's Form 10-K for the
year ended June 30, 2003 under Item 3, "Legal Proceeding". On December 24, 2003,
the Company entered into a Compromise and Settlement Agreement with Speroni
S.p.A. that resolved the arbitration award. As a result of the settlement, on
December 24, 2003, the Company paid Speroni S.p.A. approximately $2.3 million.
Foreign Currency and Other - There was a net foreign currency gain of $596,000
for the nine months ended March 31, 2004 primarily due to the strengthening Euro
compared with a foreign currency loss of
13
$31,000 during the same period last year. Other income, net was $151,000 in the
nine months ended March 31, 2004 compared to other income last year of $23,000.
During the nine months ended March 31, 2004, the Company recorded income related
to the settlement of all legal disputes with LMI Technologies, Inc. which was
offset by certain costs incurred to secure the settlement as well as the
reversal of certain costs previously expensed that were not required to be paid
in the final settlement of the arbitration award with Speroni S.p.A., see Part
II "Other Information", Item 1 "Legal Proceedings".
Income Taxes - Income tax expense for the nine-month periods ended March 31,
2004 and 2003 reflected the mix of operating profit and loss among the Company's
various operating entities and their countries' respective tax rates.
LIQUIDITY AND CAPITAL RESOURCES
The Company's cash and cash equivalents grew to $21.5 million at March 31, 2004,
compared to $11.1 million at June 30, 2003. The $10.4 million increase in cash
was primarily generated from operations. Net income of $3.1 million, non-cash
add backs of $1.5 million and a reduction in receivables of $10.3 million more
than offset uses of cash of $5.4 million for other current assets and accrued
liabilities, $332,000 for accounts payable and $239,000 for inventories. The
$10.3 million reduction in receivables primarily relates to increased cash
collections due to the higher sales levels achieved in the second half of fiscal
2003. The $5.4 million use of cash for other current assets and accrued
liabilities, primarily represents payments of approximately $2.3 million as
settlement of the Speroni S.p.A. arbitration (discussed more fully in Part II
"Other Information", Item 1 "Legal Proceedings" below), payments of $2.1 million
for accrued profit sharing and 401K related to fiscal 2003 results and
approximately $1.0 million related to other accrued liabilities and taxes
payable.
Also during the nine-month period, the Company received cash from stock option
exercises of $831,000, had capital expenditures of $931,000 and had a favorable
cash effect of $489,000 related to the impact of exchange rate changes,
principally due to the strong Euro, on Company cash held in Euros.
During the nine-month period, the Company's reserve for inventory obsolescence
decreased $10,000 to $559,000 reflecting additional accruals for anticipated
obsolescence of approximately $101,000 and disposals of $111,000 of inventory
that had been reserved for at June 30, 2003. The Company provides a reserve for
obsolescence to recognize the effects of engineering change orders and other
matters that affect the value of the inventory. When inventory is deemed to have
no further use or value, the Company disposes of the inventory and the reserve
for obsolescence is reduced. During the nine months ended March 31, 2004, the
Company's reserve for doubtful accounts decreased $157,000 to $517,000
reflecting charge-offs of $158,000. The Company determines its allowance for
doubtful accounts by considering a number of factors, including the length of
time trade accounts receivable are past due, the Company's previous loss
history, the customer's current ability to pay its obligation to the Company,
and the condition of the general economy and the industry as a whole. The
Company writes-off accounts receivable when they become uncollectible, and
payments subsequently received on such receivables are credited to the allowance
for doubtful accounts. To date, the Company has not experienced any significant
losses related to the collection of accounts receivable.
The Company has a $7.5 million collateral-based Credit Agreement with Comerica
Bank, which expires on November 1, 2005. Proceeds under the Credit Agreement may
be used for working capital and capital expenditures. The collateral for the
loan is substantially all U.S. assets of the Company. Borrowings are designated
as a Prime-based Advance or as a Eurodollar-based Advance. Interest on
Prime-based Advances is payable on the last day of each month and is calculated
daily at a rate that ranges from a 1/2% below to a 1/4% above the bank's prime
rate (4.00% as of March 31, 2004) dependent upon the Company's
14
ratio of funded debt to earnings before interest, taxes, depreciation and
amortization ("EBITDA"). Interest on Eurodollar-based Advances is calculated at
a specific margin above the Eurodollar Rate offered at the time and for the
period chosen (approximately 3.0% as of March 31, 2004) dependent upon the
Company's ratio of funded debt to EBITDA and is payable on the last day of the
applicable period. Quarterly, the Company pays a commitment fee on the daily
unused portion of the Credit Agreement based on a percentage dependent upon the
Company's ratio of funded debt to EBITDA. The aggregate principal amount
outstanding at any one time cannot exceed the lesser of $7.5 million or the
borrowing base which is comprised of 80% of eligible accounts receivable billed
in the United States, aged up to 180 days, plus the lesser of 25% of raw
material located in the United States or $2.0 million, plus the lesser of 50% of
finished goods inventory or $750,000 plus $4.2 million representing 60% of the
appraised value of the Company's real property located in Plymouth, Michigan.
The Credit Agreement prohibits the Company from paying dividends without the
prior written consent of the bank. In addition, the Credit Agreement requires
the Company to maintain a Tangible Net Worth, as defined in the Credit
Agreement, of not less than $32.2 million as of March 31, 2004. The borrowing
base at March 31, 2004 was $7.5 million with no borrowings outstanding.
At March 31, 2004, the Company's German subsidiary (GmbH) had an unsecured
credit facility totaling 500,000 Euros. The facility may be used to finance
working capital needs and equipment purchases or capital leases. Any borrowings
for working capital needs will bear interest at 9.0% on the first 100,000 Euros
of borrowings and 2.0% for borrowings over 100,000 Euros. The German credit
facility is cancelable at any time by either GmbH or the bank and any amounts
then outstanding would become immediately due and payable. At March 31, 2004,
GmbH had no borrowings outstanding. The facility supported outstanding letters
of credit totaling 289,000 Euros.
See Note 8 to the Consolidated Financial Statements, "Commitments and
Contingencies", contained in this Quarterly Report on Form 10-Q, Item 3, "Legal
Proceedings" and Note 9 to the Consolidated Financial Statements,
"Contingencies", of the Company's Annual Report on Form 10-K for fiscal year
2003, for a discussion of certain contingencies relating to the Company's
liquidity, financial position and results of operations.
Based upon the Company's current business plan, the Company believes that
available cash on hand, existing credit facilities and expected cash generated
from operations will be sufficient to fund its currently anticipated cash flow
requirements through fiscal 2005. The Company does not believe that inflation
has significantly impacted historical operations and does not expect any
significant near-term inflationary impact. The foregoing statements are
"forward-looking statements" within the meaning of the Securities Exchange Act
of 1934, as amended. See Item 2 "Management's Discussion and Analysis of
Financial Condition and Results of Operations - Safe Harbor Statement" for a
discussion of a number of uncertainties which could cause actual results to
differ materially from those set forth in the forward looking statements.
CRITICAL ACCOUNTING POLICIES
A summary of critical accounting policies is presented in Item 7, "Management's
Discussion and Analysis of Financial Condition and Results of Operations -
Critical Accounting Policies" of the Company's Annual Report on Form 10-K for
fiscal year 2003. There have been no material changes in the accounting policies
followed by the Company during the nine months of fiscal year 2004.
15
MARKET RISK INFORMATION
Perceptron's primary market risk is related to foreign exchange rates. The
foreign exchange risk is derived from the operations of its international
subsidiaries, which are primarily located in Germany and for which products are
produced in the U.S. The Company may from time to time have interest rate risk
in connection with its borrowings.
FOREIGN CURRENCY RISK
The Company has foreign currency exchange risk in its international operations
arising from the time period between sales commitment and delivery for contracts
in non-U.S. currencies. For sales commitments entered into in non-U.S.
currencies, the currency rate risk exposure is predominantly less than one year
with the majority in the 120 to 150 day range. At March 31, 2004, the Company's
percentage of sales commitments in non-U.S. currencies was approximately 45.5%
or $8.8 million compared to 41% or $7.7 million at March 31, 2003.
The Company may use, from time to time, a limited hedging program to minimize
the impact of foreign currency fluctuations. These transactions involve the use
of forward contracts. These forward contracts, which typically mature within one
year, are designed to hedge anticipated foreign currency transactions. The
Company's forward exchange contracts do not subject it to material risk due to
exchange rate movements, because gains and losses on these contracts offset
losses and gains on the assets, liabilities, and transactions being hedged. The
Company may use forward exchange contracts to hedge the net assets of certain of
its foreign subsidiaries to offset the translation and economic exposures
related to the Company's investment in these subsidiaries.
At March 31, 2004, the Company had forward exchange contracts between the United
States Dollar and the Euro in the notional amount of approximately $11.0
million. The forward exchange contracts are accounted for as cash flow hedges
and have a weighted average settlement price of 1.17 Euros to the United States
Dollar. The contracts outstanding at March 31, 2004, mature through December 8,
2004 and are intended to hedge the Company's investment in its German
subsidiary. During the nine months ended March 31, 2004, the Company recognized
a charge of approximately $805,000 in other comprehensive income (loss) for the
unrealized change in value of the forward exchange contracts. Offsetting this
amount was an increase in other comprehensive income (loss) for the translation
effect of the Company's German subsidiary. The Company's forward exchange
contracts do not subject it to material risk due to exchange rate movements
because gains and losses on these contracts offset losses and gains on the
assets, liabilities, and transactions being hedged.
At March 31, 2003, the Company had forward exchange contracts between the U.S.
Dollar and the Euro in the notional amount of $3.0 million that matured on
December 30, 2003.
INTEREST RATE RISK
The Company is subject to interest rate risk in connection with any borrowings
under its variable and fixed rate revolving lines of credit. The Company's
exposure to interest rate risk would arise primarily from changes in the prime
rate and changes in Eurodollar rates in the London interbank market. The Company
would not expect its operating results or cash flows to be affected to any
significant degree by a hypothetical 10 percent change in market interest rates.
See Note 6 of Notes to Consolidated Financial Statements, "Credit Facilities",
for a description of the Company's available credit facilities.
16
SAFE HARBOR STATEMENT
Certain statements in this Management's Discussion and Analysis of Financial
Condition and Results of Operations may be "forward-looking statements" within
the meaning of the Securities Exchange Act of 1934, including the Company's
expectation as to fiscal 2004 and future revenue, order booking levels and
earnings levels, the continued strength of the Euro and the ability of the
Company to fund its currently anticipated fiscal 2004 and long term cash flow
requirements. The Company assumes no obligation for updating any such
forward-looking statements to reflect actual results, changes in assumptions or
changes in other factors affecting such forward-looking statements. Actual
results could differ materially from those in the forward-looking statements due
to a number of uncertainties, including, but not limited to, the dependence of
the Company's revenue on a number of sizable orders from a small number of
customers, the timing of orders and shipments which can cause the Company to
experience significant fluctuations in its quarterly and annual revenue and
operating results, timely receipt of required supplies and components which
could result in delays in anticipated shipments, general product demand and
market acceptance risks, the ability of the Company to successfully compete with
alternative and similar technologies, the timing and continuation of the
Automotive industry's retooling programs, the ability of the Company to resolve
technical issues inherent in the development of new products and technologies,
the ability of the Company to identify and satisfy market needs, general product
development and commercialization difficulties, the ability of the Company to
attract and retain key personnel, especially technical personnel, the quality
and cost of competitive products already in existence or developed in the
future, the level of interest existing and potential new customers may have in
new products and technologies generally, rapid or unexpected technological
changes, and the effect of economic conditions, particularly economic conditions
in the domestic and worldwide Automotive industry, which has from time to time
been subject to cyclical downturns due to the level of demand for, or supply of,
the products produced by companies in this industry. The Company's expectations
regarding future bookings and revenues are projections developed by the Company
based upon information from a number of sources, including, but not limited to,
customer data and discussions. These projections are subject to change based
upon a wide variety of factors, a number of which are discussed above. Certain
of these new orders have been delayed in the past and could be delayed in the
future. Because the Company's products are typically integrated into larger
systems or lines, the timing of new orders is dependent on the timing of
completion of the overall system or line. In addition, because the Company's
products have shorter lead times than other components and are required later in
the process, orders for the Company's products tend to be given later in the
integration process. Because a significant portion of the Company's revenues are
denominated in foreign currencies, and are translated for financial reporting
purposes into U.S. Dollars, the level of the Company's reported net sales,
operating profits and net income are affected by changes in currency exchange
rates, principally between U.S. Dollars and Euros. Currency exchange rates are
subject to significant fluctuations, due to a number of factors beyond the
control of the Company, including general economic conditions in the United
States and other countries. Because the Company's expectations regarding future
revenues, operating profits and net income are based upon assumptions as to the
levels of such currency exchange rates, actual results could differ materially
from the Company's expectations.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Information required pursuant to this item is incorporated by reference herein
from Item 2 "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Market Risk Information".
17
ITEM 4. CONTROLS AND PROCEDURES
The Company carried out an evaluation, under the supervision and with the
participation of the Company's management, including its Chief Executive Officer
and Chief Financial Officer, of the effectiveness of the design and operation of
the Company's disclosure controls and procedures pursuant to Rule 13a-15 of the
Securities Exchange Act of 1934. Based upon that evaluation, the Company's Chief
Executive Officer and Chief Financial Officer concluded that, as of March 31,
2004, the Company's disclosure controls and procedures were effective in causing
the material information required to be disclosed by the Company in the reports
that it files or submits under the Securities Exchange Act of 1934 to be
recorded, processed, summarized and reported, to the extent applicable, within
the time periods required for the Company to meet the Securities and Exchange
Commission's ("SEC") filing deadlines for these reports specified in the SEC's
rules and forms. There have been no changes in the Company's internal controls
over financial reporting during the quarter ended March 31, 2004 identified in
connection with the Company's evaluation that has materially affected, or is
reasonably likely to materially affect, the Company's internal controls over
financial reporting.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The following disclosures update and should be read in conjunction with Item 3,
"Legal Proceedings" of the Company's Form 10-K for the year ended June 30, 2003.
As previously disclosed in the Company's Form 10-Q for the quarter ended
September 30, 2003, on October 15, 2003, the Company entered into a Settlement
Agreement ("Agreement") with LMI Technologies, Inc. ("LMI"), Diffracto Limited,
Sensor Adaptive Machines, Inc., Leonard Metcalfe, Neil Hummel and others that
resolved all pending litigation matters between the parties. The Agreement
settled the May 10, 2002 action the Company commenced against LMI et al. in the
Ontario Superior Court of Justice-Commercial List, the February 21, 2003 suit
filed by the Company against LMI in the United States District Court for the
Eastern District of Michigan and the May 30, 2003 suit filed by LMI against the
Company in the United States District Court for the Eastern District of Michigan
that are discussed more fully in the Company's Form 10-K for the year ended June
30, 2003 under Item 3, "Legal Proceedings". As part of the settlement, LMI
agreed to pay the Company a cash settlement and the parties agreed to cross
license certain intellectual property, including intellectual property that was
the subject of the disputes.
As previously disclosed in the Company's Form 10-Q for the quarter ended
December 31, 2003, on December 24, 2003, the Company entered into a Compromise
and Settlement Agreement with Speroni S.p.A. that resolved the arbitration award
that is discussed more fully in the Company's Form 10-K for the year ended June
30, 2003 under Item 3, "Legal Proceedings". As a result of the settlement, on
December 24, 2003, the Company paid Speroni S.p.A. approximately $2.3 million.
On March 15, 2004, the Company entered into a Settlement Agreement with MERILab,
Inc. and others that resolved the suit filed by MERILab against the Company in
the United States District Court for the District of Colorado that is discussed
more fully in the Company's Form 10-K for the year ended June 30, 2003 under
Item 3, "Legal Proceedings". As part of the settlement, MERILab and the Company
entered into a supply agreement pursuant to which the Company will supply
sensors to MERILab and the Company agreed to license to MERILab certain
intellectual property that was the subject of the dispute.
18
See Item 2, "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Critical Accounting Policies - Litigation and Other
Contingencies" for a discussion of the Company's accounting policies regarding
legal proceedings and other contingencies.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) Exhibits
31.1 Section 302 Certification of Chief Executive Officer
31.2 Section 302 Certification of Chief Financial Officer
32.1 Section 906 Certification of Chief Executive Officer
32.2 Section 906 Certification of Chief Financial Officer
(B) Reports on Form 8-K
On February 10, 2004, the Company furnished a Form 8-K under Item 12 -
"Results of Operations and Financial Condition" concerning the Company's
press release announcing its financial results for the second quarter
ended December 31, 2003.
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.
PERCEPTRON, INC.
(Registrant)
Date: May 14, 2004 By: /S/ Alfred A. Pease
------------------------------------------
Alfred A. Pease
President and Chief Executive Officer
Date: May 14, 2004 By: /S/ John J. Garber
------------------------------------------
John J. Garber
Vice President and Chief Financial Officer
(Principal Financial Officer)
Date: May 14, 2004 By: /S/ Sylvia M. Smith
------------------------------------------
Sylvia M. Smith
Controller and Chief Accounting Officer
(Principal Accounting Officer)
19
EXHIBITS NO DESCRIPTION
- ----------- -----------
Ex - 31.1 Section 302 Certification of Chief Executive Officer
Ex - 31.2 Section 302 Certification of Chief Financial Officer
Ex - 32.1 Section 906 Certification of Chief Executive Officer
Ex - 32.2 Section 906 Certification of Chief Financial Officer