x
|
Quarterly
Report Pursuant To Section 13 or 15(d) of the Securities Exchange Act of
1934 for the Quarterly Period Ended March 31,
2008
|
o
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Transition
Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934 for the Transition Period
from to
|
Atrion
Corporation
|
||
(Exact
Name of Registrant as Specified in its Charter)
|
||
Delaware
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63-0821819
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(State
or Other Jurisdiction of Incorporation or Organization)
|
(I.R.S.
Employer Identification No.)
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Large
accelerated filer o
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Accelerated
filer x
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Non-accelerated
filer o
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Smaller
reporting company o
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Title
of Each Class
|
Number
of Shares Outstanding at
April
30, 2008
|
|
Common
stock, Par Value $0.10 per share
|
1,960,535
|
2
|
|||
Item 1. Financial Statements | |||
3
|
|||
4
|
|||
5
|
|||
6
|
|||
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations |
8
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||
Item 3. Quantitative and Qualitative Disclosures About Market Risk |
11
|
||
Item 4. Controls and Procedures |
11
|
||
12
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|||
Item 1. Legal Proceedings |
12
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||
Item 1A. Risk Factors |
12
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||
Item 6. Exhibits and Reports on Form 8-K |
12
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||
13
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Three
Months Ended
March
31,
|
||||||||
2008
|
2007
|
|||||||
(in
thousands, except per share amounts)
|
||||||||
Revenues
|
$ | 24,602 | $ | 23,037 | ||||
Cost
of goods sold
|
13,922 | 13,377 | ||||||
Gross
profit
|
10,680 | 9,660 | ||||||
Operating
expenses:
|
||||||||
Selling
|
1,699 | 1,651 | ||||||
General
and administrative
|
2,740 | 2,616 | ||||||
Research
and development
|
787 | 656 | ||||||
5,226 | 4,923 | |||||||
Operating
income
|
5,454 | 4,737 | ||||||
Other
income:
|
||||||||
Interest
income
|
36 | 9 | ||||||
Interest
expense
|
-- | (141 | ) | |||||
36 | (132 | ) | ||||||
Income
before provision for income taxes
|
5,490 | 4,605 | ||||||
Provision
for income taxes
|
(1,834 | ) | (1,469 | ) | ||||
Net
income
|
$ | 3,656 | $ | 3,136 | ||||
Income
per basic share
|
$ | 1.89 | $ | 1.68 | ||||
Weighted
average basic shares outstanding
|
1,937 | 1,872 | ||||||
Income
per diluted share
|
$ | 1.83 | $ | 1.59 | ||||
Weighted
average diluted shares outstanding
|
2,003 | 1,975 | ||||||
Dividends
per common share
|
$ | 0.24 | $ | 0.20 |
|
March
31,
|
December 31,
|
||||||
Assets
|
2008
|
2007
|
||||||
|
(in
thousands)
|
|||||||
Current
assets:
|
||||||||
Cash
and cash equivalents
|
$ | 5,270 | $ | 3,531 | ||||
Accounts
receivable
|
12,270 | 9,601 | ||||||
Inventories
|
17,977 | 17,387 | ||||||
Prepaid
expenses
|
771 | 1,483 | ||||||
Other
|
607 | 607 | ||||||
36,895 | 32,609 | |||||||
Property,
plant and equipment
|
91,749 | 89,736 | ||||||
Less
accumulated depreciation and amortization
|
36,797 | 35,686 | ||||||
54,952 | 54,050 | |||||||
Other
assets and deferred charges:
|
||||||||
Patents
|
1,932 | 2,011 | ||||||
Goodwill
|
9,730 | 9,730 | ||||||
Other
|
956 | 913 | ||||||
12,618 | 12,654 | |||||||
$ | 104,465 | $ | 99,313 | |||||
Liabilities and
Stockholders’ Equity
|
||||||||
Current
liabilities:
|
||||||||
Accounts
payable and accrued liabilities
|
$ | 7,581 | $ | 6,349 | ||||
Accrued
income and other taxes
|
28 | 515 | ||||||
7,609 | 6,864 | |||||||
Line
of credit
|
-- | -- | ||||||
Other
non-current liabilities
|
7,017 | 7,007 | ||||||
Stockholders’
equity:
|
||||||||
Common
shares, par value $0.10 per share; authorized 10,000 shares, issued 3,420
shares
|
342 | 342 | ||||||
Paid-in
capital
|
18,445 | 15,790 | ||||||
Accumulated
other comprehensive loss
|
(486 | ) | (486 | ) | ||||
Retained
earnings
|
107,205 | 104,021 | ||||||
Treasury
shares,1,459 at March 31, 2008 and 1,509 at December 31, 2007, at
cost
|
(35,667 | ) | (34,225 | ) | ||||
Total
stockholders’ equity
|
89,839 | 85,442 | ||||||
$ | 104,465 | $ | 99,313 |
Three
months Ended
|
||||||||
March
31,
|
||||||||
2008
|
2007
|
|||||||
|
(In
thousands)
|
|||||||
Cash
flows from operating activities:
|
||||||||
Net
income
|
$ | 3,656 | $ | 3,136 | ||||
Adjustments
to reconcile net income to net
cash provided by operating activities:
|
||||||||
Depreciation
and amortization
|
1,497 | 1,305 | ||||||
Deferred
income taxes
|
134 | 67 | ||||||
Stock-based
compensation
|
113 | 55 | ||||||
Other
|
37 |
--
|
||||||
5,437 | 4,563 | |||||||
Changes
in operating assets and liabilities:
|
||||||||
Accounts
receivable
|
(2,668 | ) | (536 | ) | ||||
Inventories
|
(590 | ) | (93 | ) | ||||
Prepaid
expenses
|
789 | 1,000 | ||||||
Other
non-current assets
|
(43 | ) | (91 | ) | ||||
Accounts
payable and current liabilities
|
1,232 | 350 | ||||||
Accrued
income and other taxes
|
(486 | ) | 1,161 | |||||
Other
non-current liabilities
|
(124 | ) |
--
|
|||||
Net
cash provided by continuing operations
|
3,547 | 6,354 | ||||||
Cash
flows from investing activities:
|
||||||||
Property,
plant and equipment additions
|
(2,357 | ) | (1,478 | ) | ||||
Cash
flows from financing activities:
|
||||||||
Line
of credit advances
|
--
|
6,104 | ||||||
Line
of credit repayments
|
--
|
(11,001 | ) | |||||
Exercise
of stock options
|
497 | 204 | ||||||
Taxes
paid on cashless exercise of stock options
|
(870 | ) |
--
|
|||||
Tax
benefit related to stock options
|
1,393 | 168 | ||||||
Dividends
paid
|
(471 | ) | (377 | ) | ||||
549 | (4,902 | ) | ||||||
Net
change in cash and cash equivalents
|
1,739 | (26 | ) | |||||
Cash
and cash equivalents at beginning of period
|
3,531 | 333 | ||||||
Cash
and cash equivalents at end of period
|
$ | 5,270 | $ | 307 | ||||
Cash
paid for:
|
||||||||
Interest
(net of capitalization)
|
$ |
--
|
$ | 158 | ||||
Income
taxes
|
$ | 64 | $ | (760 | ) |
(1)
|
Basis
of Presentation
|
(2)
|
Inventories
|
March
31,
|
December
31,
|
|||||||
2008
|
2007
|
|||||||
Raw
materials
|
$ | 7,817 | $ | 7,452 | ||||
Work
in process
|
5,003 | 4,513 | ||||||
Finished
goods
|
5,157 | 5,422 | ||||||
Total
inventories
|
$ | 17,977 | $ | 17,387 |
(3)
|
Income
per share
|
|
Three
months ended
|
|||||||
March
31,
|
||||||||
|
2008
|
2007
|
||||||
|
(in
thousands, except per share amounts)
|
|||||||
Net
Income
|
$ | 3,656 | $ | 3,136 | ||||
Weighted
average basic shares outstanding
|
1,937 | 1,872 | ||||||
Add: Effect
of dilutive securities
|
66 | 103 | ||||||
Weighted
average diluted shares outstanding
|
2,003 | 1,975 | ||||||
Income
per share:
|
||||||||
Basic
|
$ | 1.89 | $ | 1.68 | ||||
Diluted
|
$ | 1.83 | $ | 1.59 |
(4)
|
Pension
Benefits
|
Three
Months ended
March
31,
|
||||||||
2008
|
2007
|
|||||||
Service
cost
|
$ | -- | $ | 65 | ||||
Interest
cost
|
56 | 80 | ||||||
Expected
return on assets
|
(55 | ) | (123 | ) | ||||
Prior
service cost amortization
|
-- | (9 | ) | |||||
Actuarial
loss
|
8 | 15 | ||||||
|
||||||||
Net
periodic pension cost
|
$ | 9 | $ | 28 |
(5)
|
Recent
Accounting Pronouncements
|
Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
|
|
·
|
Focusing
on customer needs;
|
|
·
|
Expanding
existing product lines and developing new
products;
|
|
·
|
Maintaining
a culture of controlling cost; and
|
|
·
|
Preserving
and fostering a collaborative, entrepreneurial management
structure.
|
Three
Months ended
March
31,
|
||||||||
2008
|
2007
|
|||||||
Fluid
Delivery
|
$ | 8,249 | $ | 7,215 | ||||
Cardiovascular
|
7,467 | 6,051 | ||||||
Ophthalmology
|
3,779 | 4,654 | ||||||
Other
|
5,107 | 5,117 | ||||||
Total
|
$ | 24,602 | $ | 23,037 |
Quantitative
and Qualitative Disclosures About Market
Risk
|
Controls
and Procedures
|
Legal
Proceedings
|
Risk
Factors
|
Exhibits
and Reports on Form 8-K
|
|
(a)
|
Exhibits
|
Deferred
Compensation Plan For Non-Employee Directors (As amended and restated as
of March 5, 2008)
|
|
Sarbanes-Oxley
Act Section 302 Certification of Chief Executive
Officer
|
|
Sarbanes-Oxley
Act Section 302 Certification of Chief Financial
Officer
|
|
Certification
Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of
The Sarbanes – Oxley Act Of 2002
|
|
Certification
Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of
The Sarbanes – Oxley Act Of 2002
|
|
(b)
|
Reports
on Form 8-K
|
Date: May
8, 2008
|
/s/ Emile A. Battat
|
Emile A. Battat
|
|
Chairman
and
|
|
Chief
Executive Officer
|
|
Date: May
8, 2008
|
/s/ Jeffery Strickland
|
Jeffery
Strickland
|
|
Vice
President and
|
|
Chief
Financial Officer
|