SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
__________________
FORM
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date
of
Report (Date of earliest event reported): April 17,
2008
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STRATTEC
SECURITY CORPORATION
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(Exact
name of registrant as specified in its
charter)
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Wisconsin
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(State
or other jurisdiction of
incorporation)
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0-25150
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39-1804239
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(Commission
File Number)
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(I.R.S.
Employer I.D. Number)
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3333
West Good Hope Road
Milwaukee,
WI
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53209
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(Address
of Principal Executive Offices)
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(Zip
Code)
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(414)
247-3333
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(Registrant's
telephone number; including area
code)
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Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General
Instruction A.2. below):
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17
CFR
240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange
Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange
Act (17 CFR 240.13e-4(c))
Section
2 – Financial Information
Item
2.02. Results
of
Operations and Financial Condition.
On
April
17, 2008, STRATTEC SECURITY CORPORATION
issued a
press release (the "Press Release") announcing results for the fiscal
third quarter
ended
March 30, 2008. A copy of the Press Release
is attached as Exhibit 99.1 to this report. The attached Exhibit
99.1 is furnished pursuant to Item 2.02 of Form 8-K.
The
information in this Form 8-K and the
Exhibit attached hereto shall not be deemed "filed" for purposes of Section
18
of the Securities Exchange Act of 1934, nor shall it be deemed incorporated
by
reference in any filing under the Securities Act of 1933 or the Securities
Exchange Act of 1934, except as shall be expressly set forth by specific
reference in such filing.
Section
9 - Financial Statements and Exhibits
Item
9.01. Financial
Statements and
Exhibits.
(d) Exhibits
99.1 -- Press Release of STRATTEC SECURITY CORPORATION, issued April 17,
2008.
2
SIGNATURE
Pursuant
to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report
to
be signed on its behalf by the undersigned thereunto duly
authorized.
STRATTEC
SECURITY CORPORATION
Date: April
18, 2008
BY
/s/
Patrick J.
Hansen
Patrick J. Hansen,
Senior Vice President
and Chief Financial Officer
3
Exhibit
99.1
FOR
RELEASE AT 3:00 P.M. CDT
Contact: Pat
Hansen
Senior
Vice President and
Chief
Financial Officer
414-247-3435
www.strattec.com
STRATTEC
SECURITY CORPORATION
REPORTS
FISCAL THIRD QUARTER RESULTS
Milwaukee,
Wisconsin – April 17, 2008 -- STRATTEC SECURITY CORPORATION (NASDAQ:STRT) today
reported operating results for the fiscal third quarter ended March 30,
2008.
Net
sales
for the Company’s third quarter ended March 30, 2008 were $38.4 million,
compared to net sales of $45.6 million for the third quarter ended April 1,
2007. Net income for the period was $446,000, compared to $2.9
million in the prior year quarter. Diluted earnings per share for the
period were $.13 compared to $.82 in the prior year quarter. The
lower sales and net income for the quarter reflect the negative impact of
several factors depressing the demand for new vehicles in North America, and
the
effects of a prolonged strike against a major supplier to General Motors
Corporation. These factors have resulted in significantly lower
vehicle production and correspondingly reduced sales of STRATTEC’s
products.
For
the
nine months ended March 30, 2008, net sales were $121.1 million compared to
net
sales of $121.6 million in the prior year period. Net income was $4.2
million compared to net income of $4.7 million in the prior year period and
diluted earnings per share were $1.19 compared to $1.33.
Overall,
sales to STRATTEC’s largest customers were significantly lower in the current
quarter compared to the prior year quarter. However, sales to General
Motors Corporation in the current quarter were slightly higher, at $10.1 million
compared to $9.5 million in the prior year quarter due to higher product content
on certain GM vehicles and the takeover of some passenger car lockset production
from another supplier. These sales gains were partially offset by
reduced sales directly related to a strike called by the UAW against a major
General Motors supplier which caused General Motors to close several of it’s
assembly plants supplied by STRATTEC. Sales to Chrysler LLC were $9.7
million compared to $15.9 million and sales to Delphi Corporation were $3.8
million compared to $4.8 million due to reduced component content and lower
vehicle production volumes. Sales to Ford Motor Company were $5.0
million compared to $5.7 million due to lower production volumes.
Sales
during the current quarter were generally in line with previously announced
production cuts by STRATTEC’s three largest customers. However, the
impact of the strike referenced earlier was not expected and reduced sales
to
General Motors and Delphi Corporation by approximately $1.2 million in the
current quarter. As this strike has continued into April, we expect a
similar reduction in our sales to these two customers during our fiscal fourth
quarter.
Gross
profit margins were 16.3% in the current quarter compared to 18.3% in the prior
year quarter. The decrease in gross profit margins was
primarily attributed to the reduction in customer vehicle production volumes
somewhat offset by lower purchased raw material cost for zinc in comparison
to
last year.
Operating
expenses were $6.1 million in the current quarter, compared to $5.0 million
in
the prior year quarter. The increased spending is attributed to
hiring additional engineering personnel along with costs associated with new
product development important to STRATTEC’s future and more near-term customer
programs that are anticipated to launch during the later part of our fiscal
fourth quarter.
During
the current quarter, the Company contributed $1.0 million to its Pension Fund
and repurchased 30,805 STRATTEC SECURITY CORPORATION shares under the Company’s
stock repurchase program at a cost of $1,187,000.
STRATTEC
designs, develops, manufactures and markets mechanical locks and keys,
electronically enhanced locks and keys, steering column and instrument panel
ignition lock housings, latches and related access control products for North
American automotive customers, and for global automotive manufacturers through
the VAST Alliance in which it participates with WITTE Automotive of Velbert,
Germany and ADAC Automotive of Grand Rapids, Michigan. The Company’s
history in the automotive business spans nearly 100 years.
Certain
statements contained in this release contain “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of 1995. These
statements may be identified by the use of forward-looking words or phrases
such
as “anticipate,” “believe,” “could,” “expect,” “intend,” “may,” “planned,”
“potential,” “should,” “will,” and “would.” Such
forward-looking statements in this release are inherently subject to many
uncertainties in the Company’s operations and business
environment. These uncertainties include general economic conditions,
in particular, relating to the automotive industry, consumer demand for the
Company’s and its customers’ products, competitive and
technological developments, customer purchasing actions, foreign currency
fluctuations, and costs of operations. Shareholders, potential
investors and other readers are urged to consider these factors carefully in
evaluating the forward-looking statements and are cautioned not to place undue
reliance on such forward-looking statements. The forward-looking
statements made herein are only made as of the date of this press release and
the Company undertakes no obligation to publicly update such forward-looking
statements to reflect subsequent events or circumstances occurring after the
date of this release. In addition, such uncertainties and other
operational matters are discussed further in the Company’s quarterly and annual
filings with the Securities and Exchange Commission.
2
STRATTEC
SECURITY
CORPORATION
Results
of Operations
(In
Thousands except per share amounts)
|
Third
Quarter Ended
|
Nine
Months Ended
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|||||||||||||||
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March
30, 2008
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April
1, 2007
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March
30, 2008
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April
1, 2007
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|||||||||||||
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(Unaudited)
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(Unaudited)
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|||||||||||||||
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Net
Sales
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$ | 38,428 | $ | 45,647 | $ | 121,075 | $ | 121,610 | ||||||||
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Cost
of Goods Sold
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32,161 | 37,293 | 99,508 | 102,934 | ||||||||||||
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Gross
Profit
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6,267 | 8,354 | 21,567 | 18,676 | ||||||||||||
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Engineering,
Selling &
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||||||||||||||||
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Administrative
Expenses
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6,109 | 4,974 | 17,740 | 14,882 | ||||||||||||
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Income
from Operations
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158 | 3,380 | 3,827 | 3,794 | ||||||||||||
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Interest
Income
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617 | 879 | 2,344 | 2,706 | ||||||||||||
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Other
Income (Expense), Net
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(58 | ) | 341 | 408 | 490 | |||||||||||
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Minority
Interest
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(48 | ) | 25 | 70 | 25 | |||||||||||
| 669 | 4,625 | 6,649 | 7,015 | |||||||||||||
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Provision
for Income Taxes
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223 | 1,711 | 2,461 | 2,266 | ||||||||||||
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Net
Income
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$ | 446 | $ | 2,914 | $ | 4,188 | $ | 4,749 | ||||||||
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Earnings
Per Share:
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||||||||||||||||
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Basic
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$ | 0.13 | $ | 0.82 | $ | 1.20 | $ | 1.33 | ||||||||
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Diluted
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$ | 0.13 | $ | 0.82 | $ | 1.19 | $ | 1.33 | ||||||||
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Average
Basic
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||||||||||||||||
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Shares
Outstanding
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3,476 | 3,537 | 3,500 | 3,558 | ||||||||||||
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Average
Diluted
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||||||||||||||||
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Shares
Outstanding
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3,482 | 3,541 | 3,506 | 3,561 | ||||||||||||
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Other
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||||||||||||||||
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Capital
Expenditures
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$ | 4,013 | $ | 1,353 | $ | 8,487 | $ | 3,645 | ||||||||
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Depreciation
& Amortization
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$ | 1,665 | $ | 1,699 | $ | 5,161 | $ | 5,216 | ||||||||
3
STRATTEC
SECURITY
CORPORATION
Condensed
Balance Sheet Data
(In
Thousands)
|
March
30, 2008
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July
1, 2007
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|||||||
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(Unaudited)
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||||||||
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ASSETS
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||||||||
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Current
Assets:
|
||||||||
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Cash
and cash equivalents
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$ | 59,130 | $ | 65,491 | ||||
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Receivables,
net
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20,892 | 26,890 | ||||||
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Inventories
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10,044 | 7,166 | ||||||
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Other
current assets
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14,690 | 13,017 | ||||||
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Total
Current Assets
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104,756 | 112,564 | ||||||
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Deferred
Income Taxes
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1,890 | 2,117 | ||||||
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Investment
in Joint Ventures
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3,456 | 2,813 | ||||||
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Prepaid
Pension Cost
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7,730 | 4,385 | ||||||
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Other
Long Term Assets
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31 | 41 | ||||||
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Property,
Plant and Equipment, Net
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29,849 | 26,526 | ||||||
| $ | 147,712 | $ | 148,446 | |||||
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LIABILITIES
AND SHAREHOLDERS’ EQUITY
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||||||||
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Current
Liabilities:
|
||||||||
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Accounts
Payable
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$ | 16,121 | $ | 16,575 | ||||
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Other
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16,489 | 14,906 | ||||||
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Total
Current Liabilities
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32,610 | 31,481 | ||||||
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Borrowings
Under Line of Credit Facility
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- | - | ||||||
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Accrued
Pension and Postretirement Obligations
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13,680 | 13,431 | ||||||
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Minority
Interest
|
813 | 574 | ||||||
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Shareholders’
Equity
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243,806 | 244,119 | ||||||
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Accumulated
Other Comprehensive Loss
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(14,054 | ) | (14,341 | ) | ||||
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Less: Treasury
Stock
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(129,143 | ) | (126,818 | ) | ||||
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Total
Shareholders’ Equity
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100,609 | 102,960 | ||||||
| $ | 147,712 | $ | 148,446 | |||||
4
STRATTEC
SECURITY
CORPORATION
Condensed
Cash Flow Statement Data
(In
Thousands)
|
Third
Quarter Ended
|
Nine
Months Ended
|
|||||||||||||||
|
March
30, 2008
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April
1, 2007
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March
30, 2008
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April
1, 2007
|
|||||||||||||
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(Unaudited)
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(Unaudited)
|
|||||||||||||||
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Cash
Flows from Operating Activities:
|
||||||||||||||||
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Net
Income
|
$ | 446 | $ | 2,914 | $ | 4,188 | $ | 4,749 | ||||||||
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Adjustment
to Reconcile Net Income to
|
||||||||||||||||
|
Cash
Used in Operating Activities:
|
||||||||||||||||
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Minority
Interest
|
37 | (25 | ) | (111 | ) | (25 | ) | |||||||||
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Depreciation
and Amortization
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1,665 | 1,699 | 5,161 | 5,216 | ||||||||||||
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Stock
Based Compensation Expense
|
124 | 187 | 616 | 566 | ||||||||||||
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Tax
Benefit from Options Exercised
|
- | 13 | - | 13 | ||||||||||||
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Change
in Operating Assets/Liabilities
|
1,802 | (7,280 | ) | (1,598 | ) | (6,294 | ) | |||||||||
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Other,
net
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(15 | ) | (177 | ) | (357 | ) | (45 | ) | ||||||||
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Net
Cash Provided (Used) by Operating Activities
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4,059 | (2,669 | ) | 7,899 | 4,180 | |||||||||||
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Cash
Flows from Investing Activities:
|
||||||||||||||||
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Investment
in Joint Ventures
|
- | - | - | (100 | ) | |||||||||||
|
Additions
to Property, Plant and Equipment
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(4,013 | ) | (1,353 | ) | (8,487 | ) | (3,645 | ) | ||||||||
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Proceeds
from Sale of Property, Plant
|
||||||||||||||||
|
and
Equipment
|
- | - | - | 21 | ||||||||||||
|
Net
Cash Used in Investing Activities
|
(4,013 | ) | (1,353 | ) | (8,487 | ) | (3,724 | ) | ||||||||
|
Cash
Flow from Financing Activities:
|
||||||||||||||||
|
Purchase
of Common Stock
|
(1,188 | ) | - | (2,334 | ) | (3,922 | ) | |||||||||
|
Dividends
Paid
|
(528 | ) | - | (4,609 | ) | - | ||||||||||
|
Contribution
from Minority Interest
|
- | 274 | 349 | 274 | ||||||||||||
|
Loan
from Minority Interest
|
550 | - | 800 | - | ||||||||||||
|
Reissue/Exercise
of Stock Options
|
8 | 82 | 21 | 99 | ||||||||||||
|
Net
Cash Provided (Used) by Financing Activities
|
(1,158 | ) | 356 | (5,773 | ) | (3,549 | ) | |||||||||
|
Net
Decrease in Cash & Cash Equivalents
|
(1,112 | ) | (3,666 | ) | (6,361 | ) | (3,093 | ) | ||||||||
|
Cash
and Cash Equivalents:
|
||||||||||||||||
|
Beginning
of Period
|
60,242 | 66,285 | 65,491 | 65,712 | ||||||||||||
|
End
of Period
|
$ | 59,130 | $ | 62,619 | $ | 59,130 | $ | 62,619 | ||||||||
5