1
Form 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
[ Mark one ]
[X] Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of
1934
For quarter ended March 31, 2001
-------------------------------------------
OR
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period from to
---------- -----------
Commission file number 1-9334
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BALDWIN TECHNOLOGY COMPANY, INC.
--------------------------------
(Exact name of registrant as specified in its charter)
Delaware 12-3258160
----------------------------------- -----------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
Twelve Commerce Drive, Shelton, Connecticut 06484
-------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 203-402-1000
------------
----------------------------------------------------------------------------
(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 Act of 1934 during
the preceding 12 months (or 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
- ---
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding at April 30, 2001
----- -----------------------------
Class A Common Stock
$0.01 par value 12,886,647
Class B Common Stock
$0.01 par value 1,810,883
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BALDWIN TECHNOLOGY COMPANY, INC.
INDEX
Page
----
Part I Financial Information
Item 1 Financial Statements
Consolidated Balance Sheets at
March 31, 2001 (unaudited) and June 30, 2000 1-2
Consolidated Statements of Income for the three and nine months
ended March 31, 2001 (unaudited) and 2000 (unaudited) 3
Consolidated Statements of Changes in Shareholders'
Equity for the nine months ended March 31, 2001 (unaudited) and
2000 (unaudited) 4
Consolidated Statements of Cash Flows for the nine months ended
March 31, 2001 (unaudited) and 2000 (unaudited) 5-6
Notes to Consolidated Financial Statements (unaudited) 7-12
Item 2 Management's Discussion and Analysis of Financial Condition and
Results of Operations 13-20
Item 3 Quantitive and Qualitative Disclosures About
Market Risk 20
Part II Other Information
Item 6 Exhibits and Reports on Form 8-K 20
Signatures 21
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BALDWIN TECHNOLOGY COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
ASSETS
March 31, June 30,
2001 2000
--------- ---------
(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents $ 8,154 $ 7,914
Accounts receivable trade, net of allowance for doubtful
accounts of $1,307 ($1,705 at June 30, 2000) 31,781 36,369
Notes receivable, trade 13,535 9,449
Inventories 32,605 37,354
Prepaid expenses and other 7,809 7,312
--------- ---------
Total Current Assets 93,884 98,398
--------- ---------
MARKETABLE SECURITIES:
Cost $554 ($805 at June 30, 2000) 545 843
--------- ---------
PROPERTY, PLANT AND EQUIPMENT, at cost:
Land and buildings 3,741 4,056
Machinery and equipment 4,456 5,064
Furniture and fixtures 4,946 4,991
Leasehold improvements 202 244
Capital leases 1,242 1,422
--------- ---------
14,587 15,777
Less: Accumulated depreciation and amortization (7,297) (8,305)
--------- ---------
Net Property, Plant and Equipment 7,290 7,472
--------- ---------
PATENTS, TRADEMARKS AND ENGINEERING DRAWINGS at cost,
less accumulated amortization of $5,609 ($6,394 at June 30, 2000) 3,004 3,873
GOODWILL, less accumulated amortization of $10,242
($10,352 at June 30, 2000) 26,545 29,561
DEFERRED TAXES 14,020 14,878
OTHER ASSETS 6,939 5,010
--------- ---------
TOTAL ASSETS $ 152,227 $ 160,035
========= =========
The accompanying notes to consolidated financial statements
are an integral part of these statements.
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BALDWIN TECHNOLOGY COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
LIABILITIES AND SHAREHOLDERS' EQUITY
March 31, June 30,
2001 2000
--------- ---------
(Unaudited)
CURRENT LIABILITIES:
Loans payable $ 5,056 $ 4,801
Current portion of long-term debt 109 6,515
Accounts payable, trade 11,529 14,188
Notes payable, trade 9,821 10,358
Accrued salaries, commissions, bonus and
profit-sharing 5,331 6,151
Customer deposits 8,198 8,965
Accrued and withheld taxes 1,504 2,195
Income taxes payable 3,861 2,168
Other accounts payable and accrued liabilities 14,670 14,836
--------- ---------
Total current liabilities 60,079 70,177
--------- ---------
LONG TERM LIABILITIES:
Long-term debt 18,369 11,882
Other long-term liabilities 7,221 7,607
--------- ---------
Total long-term liabilities 25,590 19,489
--------- ---------
Total liabilities 85,669 89,666
--------- ---------
SHAREHOLDERS' EQUITY:
Class A Common Stock, $.01 par, 45,000,000
shares authorized, 16,458,849 shares issued 165 165
Class B Common Stock, $.01 par, 4,500,000 shares
authorized, 2,000,000 shares issued 20 20
Capital contributed in excess of par value 57,496 57,496
Retained Earnings 27,768 25,629
Accumulated other comprehensive loss (5,568) (357)
Less: Treasury stock, at cost:
Class A - 3,567,202 shares
(3,191,302 at June 30, 2000)
Class B - 189,117 shares (13,323) (12,584)
--------- ---------
Total shareholders' equity 66,558 70,369
--------- ---------
COMMITMENTS AND CONTINGENCIES
--------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 152,227 $ 160,035
========= =========
The accompanying notes to consolidated financial statements
are an integral part of these statements.
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BALDWIN TECHNOLOGY COMPANY, INC.
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
For the three months For the nine months
ended March 31, ended March 31,
--------------- ---------------
2001 2000 2001 2000
---- ---- ---- ----
Net Sales $ 47,575 $ 50,711 $ 138,293 $ 147,717
Cost of goods sold 33,510 34,545 96,385 100,922
--------- --------- --------- ---------
Gross Profit 14,065 16,166 41,908 46,795
--------- --------- --------- ---------
Operating Expenses:
General and administrative 6,048 5,673 16,193 17,589
Selling 3,733 4,728 12,037 13,814
Engineering 2,909 3,091 8,660 9,147
Research and Development 1,367 1,455 4,064 4,001
Restructuring Charge 95 5,490 95 5,490
Adjustment of provision for the disposition
of Pre-Press Operations (472) 0 (472) 0
--------- --------- --------- ---------
13,680 20,437 40,577 50,041
--------- --------- --------- ---------
Operating income (loss) 385 (4,271) 1,331 (3,246)
--------- --------- --------- ---------
Other (income) expense:
Interest expense 627 397 1,663 1,390
Interest income (74) (67) (231) (236)
Royalty income, net (680) (1,004) (3,011) (2,588)
Other (income) expense, net (59) (48) (778) 86
--------- --------- --------- ---------
(186) (722) (2,357) (1,348)
--------- --------- --------- ---------
Income (loss) before income taxes 571 (3,549) 3,688 (1,898)
Provision (benefit) for income taxes 239 (5,374) 1,549 (4,829)
--------- --------- --------- ---------
Net Income $ 332 $ 1,825 $ 2,139 $ 2,931
========= ========= ========= =========
Basic income per share $ 0.02 $ 0.12 $ 0.14 $ 0.19
========= ========= ========= =========
Diluted income per share $ 0.02 $ 0.12 $ 0.14 $ 0.19
========= ========= ========= =========
Weighted average shares outstanding:
Basic 14,709 15,408 14,818 15,812
========= ========= ========= =========
Diluted 14,709 15,408 14,818 15,812
========= ========= ========= =========
The accompanying notes to consolidated financial statements
are an integral part of these statements.
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BALDWIN TECHNOLOGY COMPANY, INC.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT SHARES)
(UNAUDITED)
Class A Class B Capital Accumulated
Common Stock Common Stock Contributed Other
------------ ------------ in Excess Retained Comprehensive
Shares Amount Shares Amount of Par Earnings Loss
------ ------ ------ ------ ------ -------- ----
Balance at
June 30, 2000 16,458,849 $165 2,000,000 $20 $57,496 $25,629 $ (357)
Net income for the
nine months
ended March 31,
2001 2,139
Translation
adjustment (4,932)
Unrealized loss on
available-for-sale
securities,
net of tax (28)
Unrealized loss
on derivatives (251)
Comprehensive
Loss
Purchase of
treasury stock
---------- ---- --------- --- ------- ------- --------
Balance at
March 31, 2001 16,458,849 $165 2,000,000 $20 $57,496 $27,768 $ (5,568)
========== ==== ========= === ======= ======= ========
Treasury Stock Comprehensive
-------------- Income
Shares Amount (Loss)
------ ------ ------
Balance at
June 30, 2000 (3,380,419) $(12,584)
Net income for the
nine months
ended March 31,
2001 $ 2,139
Translation
adjustment (4,932)
Unrealized loss on
available-for-sale
securities,
net of tax (28)
Unrealized loss
on derivatives (251)
-------
Comprehensive
Loss $(3,072)
=======
Purchase of
treasury stock (375,900) (739)
---------- --------
Balance at
March 31, 2001 (3,756,319) $(13,323)
========== ========
The accompanying notes to consolidated financial statements
are an integral part of these statements.
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BALDWIN TECHNOLOGY COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
For the nine months
ended March 31,
---------------
2001 2000
---- ----
Cash Flows from operating activities:
Net Income $ 2,139 $ 2,931
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 2,542 2,948
Accrued retirement pay (28) (906)
Provision for losses on accounts receivable 0 1,255
Loss from disposition of business 650 0
Restructuring charge 0 5,490
Changes in assets and liabilities:
Accounts and notes receivable (7,706) 3,912
Inventories (1,981) (5,535)
Prepaid expenses and other (1,169) 462
Other assets 330 (1,626)
Customer deposits 2,008 4,686
Accrued compensation 189 (677)
Payments against restructuring reserve (901) 0
Accounts and notes payable, trade 1,210 1,789
Income taxes payable (83) (5,210)
Accrued and withheld taxes (450) (445)
Other accounts payable and accrued liabilities 1,025 (851)
Interest payable (269) 21
-------- --------
Net cash (used) provided by operating activities (2,494) 8,244
-------- --------
Cash flows from investing activities:
Additions of property, net (1,945) (2,372)
Additions of patents, trademarks and drawings, net (278) (239)
Proceeds from disposition of business, net 3,985 0
-------- --------
Net cash provided (used) by investing activities 1,762 (2,611)
-------- --------
Cash flows from financing activities:
Long-term borrowings 39,037 23,378
Long-term debt repayments (38,728) (30,517)
Short-term borrowings 2,292 3,080
Short-term debt repayments (1,350) (1,714)
Principal payments under capital lease obligations (3) (291)
Other long-term liabilities 629 1,022
Treasury stock purchased (129) (2,484)
-------- --------
Net cash provided (used) by financing activities 1,748 (7,526)
-------- --------
Effects of exchange rate changes (776) 349
-------- --------
Net increase (decrease) in cash and cash equivalents 240 (1,544)
Cash and cash equivalents at beginning of year 7,914 10,673
-------- --------
Cash and cash equivalents at end of period $ 8,154 $ 9,129
======== ========
The accompanying notes to consolidated financial statements
are an integral part of these statements.
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BALDWIN TECHNOLOGY COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
For the nine months
ended March 31,
---------------
2001 2000
---- ----
Cash paid during the period for:
Interest $ 1,394 $ 1,369
Income Taxes $ 1,249 $ 3,132
The Company did not enter into any capital lease agreements for either
of the nine months ended March 31, 2001 or 2000.
The accompanying notes to consolidated financial statements
are an integral part of these statements.
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BALDWIN TECHNOLOGY COMPANY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION:
Baldwin Technology Company, Inc. ("Baldwin", or the "Company") is
engaged primarily in the development, manufacture and sale of controls,
accessories and material handling equipment for the printing industry.
The accompanying unaudited consolidated financial statements include the
accounts of Baldwin and its subsidiaries and have been prepared in accordance
with generally accepted accounting principles for interim financial information
and in compliance with the instructions to Form 10-Q. Accordingly, they do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. These financial
statements reflect all adjustments (consisting of normal recurring adjustments)
which are, in the opinion of management, necessary to present a fair statement
of the results for the interim periods. These financial statements should be
read in conjunction with the consolidated financial statements and related notes
included in the Company's latest annual report on Form 10-K for the year ended
June 30, 2000. Operating results for the three and nine month periods ended
March 31, 2001 are not necessarily indicative of the results that may be
expected for the year ending June 30, 2001. All significant intercompany
transactions have been eliminated in consolidation.
NOTE 2 - EARNINGS PER SHARE:
Basic earnings per share is computed by dividing net income for the
period by the weighted average number of common shares outstanding for the
period. Diluted earnings per share reflects the potential dilution of securities
that could share in the earnings of an entity, and is computed by dividing net
income for the period by the weighted average number of common shares
outstanding plus potentially dilutive common stock equivalents. The weighted
average shares outstanding used to compute diluted income per share include zero
shares for potentially dilutive common stock equivalents for each of the three
and nine month periods ended March 31, 2001 and 2000. Options to purchase the
Company's common stock in the amount of 1,655,000 and 2,127,000 were not
included in the computation of diluted earnings per share for either of the
three and nine month periods ended March 31, 2001 and 2000, respectively,
because the exercise prices were greater than the average market price of the
common stock for the respective periods.
NOTE 3 - OTHER COMPREHENSIVE INCOME (LOSS):
Other Comprehensive Income (Loss) ("OCI") is comprised of various items
which affect equity that result from recognized transactions and other economic
events other than transactions with owners in their capacity as owners. Prior to
December 31, 2000, OCI has been reported on the Statement of Financial Position,
and the Statement of Changes in Shareholders' Equity, using accounts for
cumulative translation adjustment and unrealized gain on investments. These two
accounts are now being combined and shown together as one item in both of the
above statements along with the amounts reported in OCI for the effect of the
adoption of the Financial Accounting Standards Board Statement of Financial
Accounting Standards No. 133, "Accounting for Derivative Instruments and Hedging
Activities" ("FAS 133").
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Accumulated other comprehensive income (loss) consists of the following:
March 31, 2001 June 30, 2000
-------------- -------------
(Unaudited)
Cumulative translation adjustment $(5,312,000) $(380,000)
Unrealized (loss) gain on investments, net of
deferred taxes of $4,000 ($15,000
at June 30, 2000) (5,000) 23,000
Unrealized loss on forward contracts (251,000) 0
----------- ---------
$(5,568,000) $(357,000)
=========== ==========
NOTE 4 - INVENTORIES:
Inventories consist of the following:
March 31, 2001 June 30, 2000
--------------- -------------
(Unaudited)
Raw materials $ 16,068,000 $ 19,559,000
In process 6,996,000 9,633,000
Finished Goods 9,541,000 8,162,000
------------ ------------
$ 32,605,000 $ 37,354,000
============ ============
Inventories decreased by $2,633,000 due to translation effects of
foreign currency from June 30, 2000 to March 31, 2001.
NOTE 5 - DERIVATIVES:
In June 1998, the Financial Accounting Standards Board issued Financial
Accounting Standards Statement No. 133, "Accounting for Derivative Instruments
and Hedging Activities" ("FAS 133"). The effective date of FAS 133 was July 1,
2000 for the Company. FAS 133 requires that all derivative instruments be
recorded on the balance sheet at their fair value. Changes in the fair value of
derivatives are recorded each period in current earnings or other comprehensive
income (loss), depending on whether a derivative is designated as part of a
hedge transaction and, if it is, the type of hedge transaction. Management of
the Company anticipates that, due to its limited use of derivative instruments,
the adoption of FAS 133 will not have a significant effect on the Company's
results of operations in future periods.
On occasion, the Company holds certain derivative instruments that are
designated and qualify as hedging instruments pursuant to FAS 133. The objective
of these derivatives is to eliminate or minimize the impact of transaction
effects of currency rate fluctuations on the Company's consolidated financial
results.
If a derivative is designated as a fair value hedge, the changes in the
fair value of the derivative and the hedged item attributable to the hedged risk
are recognized in earnings. If the derivative is designated as a cash flow
hedge, the effective portions of changes in fair value of the derivative are
recorded in OCI and are recognized in the income statement when the hedged item
affects earnings. Ineffectiveness related to cash flow hedges is recognized in
earnings.
When deemed necessary, the Company uses forward contracts to manage the
above objectives, whenever forward purchase and sale contracts or firm
commitments designated in a currency other than the functional currency, may
have a material impact on the cash flow from the transaction due to exchange
rate fluctuations. When they qualify under FAS 133, these forward contracts are
designated as cash flow hedging instruments.
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Hedge ineffectiveness, determined in accordance with FAS 133 had no
material impact on earnings for the nine months ended March 31, 2001. At July 1,
2000, the Company had a derivative that did not qualify as a hedge pursuant to
FAS 133. A $345,000 pre-tax gain was recorded during the nine months ended March
31, 2001 related to this derivative instrument. The effect on earnings of the
balance of the Company's derivative financial instruments is not material.
NOTE 6 - COMMON STOCK:
On November 15, 2000 under the Company's 1998 Directors Stock Option
Plan, five (5) eligible non-employee Directors were granted non-qualified
options to purchase 3,000 shares each (for a total of 15,000 shares) of the
Company's Class A Common Stock at an exercise price of $1.50 per share, the fair
market value of the Company's Class A Common Stock on the date of grant.
NOTE 7 - ADJUSTMENT OF PROVISION FOR THE DISPOSITION OF PRE-PRESS OPERATIONS:
In June 1997, the Company sold all of the outstanding shares of its
former Pre-Press Operations ("PPO") to Kaber Imaging, Inc. ("Kaber" or "Buyer").
The Company recorded a loss on this disposition in the amount of $42,407,000 in
the fiscal year ended June 30, 1997. When the Company acquired the PPO, in July
1991, the Company assumed the existing guarantees that were being provided by
the previous owner. The guarantees consisted of two parts: 1.) a guarantee to
Forsakring Pensiongaranti ("FPG"), a Swedish pension obligation surety bond
firm, in the form of a guarantee bond covering the quasi Swedish government
retirement plan, and 2.) a direct guarantee to a group of individual employees
who were members of a separate plan. The assumption by Kaber of the pension
obligations was unconditional.
The purchase and sale agreement for the sale of the PPO to Kaber in June
1997 included provisions for the Buyer to assume all pension liabilities related
to the PPO, to use their best efforts to gain the release of the Company from
the guarantees and to reimburse the Company for any and all costs incurred by
the Company associated with the guarantees. At the time that the PPO was sold to
Kaber, management conducted due diligence of Kaber and believed that Kaber had
the financial ability to satisfy these guarantees.
Subsequent to the sale of the PPO, Kaber and related domestic
subsidiaries filed for protection in the United States under Chapter 11 of the
bankruptcy code in February 1999 which caused similar filings in Kaber's foreign
subsidiaries including Sweden. During the period of July 1997 through February
1999, Kaber failed to gain the release of the Company from the guarantees which
remained in place. In March 1999, The Company was contacted by FPG, the surety
bond holder, to fulfill the Company's guarantee of the pension obligation.
Neither Kaber, nor its Swedish subsidiaries, which were in liquidation,
possessed the financial capability to fulfill its obligation. Based on the
demands from FPG, and representatives of the members of the separate plan and
Kaber's bankruptcy, the Company recognized the liability in its financial
results by establishing a reserve in the amount of $2,400,000 in the third
quarter of fiscal year ended June 30, 1999. To date, the Company has made
payments to FPG of $1,567,000 and due to a change in circumstances and new
information, management is resolving the amount of the benefits due to the
members of the separate group. The Company, based on this current information,
has adjusted the reserve by $472,000 to $361,000, the estimated liability at
March 31, 2001, which is included as a current liability in "Other accounts
payable and accrued liabilities".
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NOTE 8 - RESTRUCTURING CHARGE AND RELATED RESERVE:
For the year ended June 30, 2000, the Company recorded a pre-tax
restructuring charge in the amount of $5,664,000. This charge was recorded in
order to account for the estimated costs associated with the planned
consolidation of production into certain facilities, resulting in a reduction in
total employment, primarily in the United States. Prior to the restructuring,
the Company was managed in a decentralized manner through geographically
dispersed autonomous business units. Given that many of the Company's
significant customers have been consolidating on a global basis, management
decided to restructure the Company along functional lines on a global basis.
Rather than have product development and production activities at each
decentralized business unit, the restructuring plan included the centralization
of these activities into single product line development and production
facilities. Products that were previously being produced at multiple facilities
are being consolidated with similar product lines at existing facilities. The
corporate headquarters was vacated and relocated to the Shelton facility in
order to take advantage of the space created by the downsizing previously noted.
Remaining Reserve Charges against Remaining Reserve
June 30, 2000 Reserve March 31, 2001
------------- ------- -----------------
(in thousands) (unaudited)
--------------
Severance $ 2,886 $ 151 $ 2,735
Facility lease
termination 1,132 250 882
Other costs 500 500 0
------- ----- -------
Total program $ 4,518 $ 901 $ 3,617
======= ===== =======
Severance costs will be paid out through December 2001, the majority of
which is expected to be paid in the first quarter of fiscal 2002. Facility lease
termination costs will be paid out through July 2003. As of March 31, 2001,
$2,897,0000 is included in "Other accounts payable and accrued liabilities" and
$765,000 is included in "Other long-term liabilities".
NOTE 9 - BUSINESS SEGMENT INFORMATION:
The Company's two reportable segments are the Graphic Products and
Controls Group ("GPC"), and the Material Handling Group ("MHG"). The GPC segment
includes products such as cleaning systems, water systems and other equipment
designed to enhance the quality of the printed material and to improve the
productivity of the printing process. The MHG segment includes products which
handle the materials supplied to the press and automate the handling of the
printed material. The all other category is comprised of the Print On-Demand
Group, which operates in the short-run digital printing market, and other
activities.
The accounting policies of the segments are the same as those described
in the summary of significant accounting policies in the Annual Report on Form
10-K for the fiscal year ended June 30, 2000. A segment's financial performance
is primarily evaluated based on the operating profit of the segment, which
includes inter-segment sales.
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The tables below present information about reportable segments for the
three and nine month periods ended March 31, 2001, and 2000 (in thousands):
Three Months ended Nine Months ended
March 31, March 31,
--------- ---------
(Unaudited) (Unaudited)
2001 2000 2001 2000
---- ---- ----- ----
Net Sales:
Graphic Products and Controls Group $ 36,816 $ 36,317 $ 100,366 $ 107,244
Material Handling Group 10,873 14,997 38,350 43,174
All Other 41 92 619 213
-------- -------- --------- ---------
Total Segments 47,730 51,406 139,335 150,631
Inter-segment sales (155) (695) (1,042) (2,914)
-------- -------- --------- ---------
Total Net Sales $ 47,575 $ 50,711 $ 138,293 $ 147,717
======== ======== ========= =========
Three Months ended Nine Months ended
March 31, March 31,
--------- ---------
(Unaudited) (Unaudited)
2001 2000 2001 2000
---- ---- ---- ----
Operating Income (loss):
Graphic Products and Controls Group $ 2,249 $ 509 $ 4,188 $ 5,400
Material Handling Group 708 (2,497) 3,330 (3,083)
All Other (224) (276) (290) (579)
------- ----- ------- -------
Total Segments 2,733 (2,264) 7,228 1,738
Corporate (2,348) (2,007) (5,897) (4,984)
------- ----- ------- -------
Total operating income (loss) 385 (4,271) 1,331 (3,246)
Interest expense, net (553) (330) (1,432) (1,154)
Royalty income, net 680 1,004 3,011 2,588
Other income (expense), net 59 48 778 (86)
------- ----- ------- -------
Income (loss) before income taxes $ 571 $ (3,549) $ 3,688 $ (1,898)
======= ======== ======= ========
NOTE 10 - SALE OF BUSINESS:
On September 27, 2000, the Company sold substantially all the assets of
its Baldwin Stobb Division ("BSD") to Systems Technology, Inc., a new company
formed by the management of BSD. The consideration paid for the transaction,
subject to certain post-closing adjustments, was the sum of (i) $6,750,000;
minus (ii) all payments received (net of disbursements paid) on behalf of BSD
for the period July 1, 2000 through September 27, 2000 amounting to $2,155,000;
plus (iii) $175,000 in consideration for income tax obligations to be received
at a later date. The total consideration received by the Company included
307,000 shares of the Company's Class A Common Stock valued at the average fair
market price of the Company's Class A Common Stock for the ten days immediately
prior to closing ($1.9875 per share). The Company recorded a pre-tax loss of
$650,000, including associated disposition costs, as a result of this
transaction.
NOTE 11 - REVOLVING CREDIT FACILITY:
On October 31, 2000, the Company reached an agreement on a $35,000,000
revolving credit facility (the "Credit Facility") with Fleet National Bank and
First Union National Bank which matures on October 31, 2003. The Credit Facility
is subject to certain financial covenants and is collateralized by a substantial
portion of the Company's assets. The Credit Facility allows the Company to
borrow, subject to certain limitations, at variable interest rates ranging from
1.50% to 2.50% over LIBOR for a period of 3 years. The Company utilized
$11,750,000 of the initial borrowings under the Credit Facility to retire the
previously existing debt with Bank of America and Fleet National Bank. As of
March 31, 2001, the Company had
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outstanding borrowings of $17,250,000 under this Credit Facility, which is
classified as long-term. On April 27, 2001, the Company entered into an interest
rate swap agreement with Fleet National Bank to fix the LIBOR portion of its
interest rate at 4.98% for a principal amount of $15,000,000 with a maturity the
same as the Credit Facility.
NOTE 12 - RELATED PARTIES
The Compensation Committee of the Board of Directors forgave an interest
payment due from Mr. Nathe, the CEO of the Company, in the amount of $117,318 on
a loan from the Company that Mr. Nathe used to purchase shares of Class B Common
Stock of the Company. Therefore, such amount is included as compensation expense
in general and administrative expenses for the nine months ended March 31, 2001.
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BALDWIN TECHNOLOGY COMPANY, INC.
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following is management's discussion and analysis of certain factors
which have affected the financial position and consolidated financial statements
of Baldwin Technology Company, Inc. (the "Company"). On September 27, 2000, the
Company sold substantially all the assets of its Baldwin Stobb Division ("BSD").
As a result, the revenues and corresponding expenses attributable to BSD are
included in these consolidated financial statements only for the period owned by
the Company. The effects of this transaction on financial statement amounts are
discussed below where significant.
FORWARD-LOOKING STATEMENTS
Except for the historical information contained herein, the following
statements and certain other statements contained herein are based on current
expectations. Such statements are forward-looking statements that involve a
number of risks and uncertainties. The Company cautions investors that any such
forward-looking statements made by the Company are not guarantees of future
performance and that actual results may differ materially from those in the
forward-looking statements. Some of the factors that could cause actual results
to differ materially include, but are not limited to the following: (i) the
ability to obtain, maintain and defend challenges against valid patent
protection on certain technology, primarily as it relates to the Company's
cleaning systems, (ii) material changes in foreign currency exchange rates
versus the U.S. Dollar, (iii) changes in the mix of products and services
comprising revenues, (iv) a decline in the rate of growth of the installed base
of printing press units and the timing of new press orders, (v) general economic
conditions, either domestically or in foreign locations, (vi) the ultimate
realization of certain trade receivables and the status of ongoing business
levels with the Company's large OEM customers, and (vii) competitive market
influences. Additional factors are set forth in Exhibit 99 to Form 10-K for the
year ended June 30, 2000 which should be read in conjunction herewith.
NINE MONTHS ENDED MARCH 31, 2001 VS. NINE MONTHS ENDED MARCH 31, 2000
CONSOLIDATED RESULTS
Net sales for the nine months ended March 31, 2001 decreased by
$9,424,000, or 6.4%, to $138,293,000 from $147,717,000 for the nine months ended
March 31, 2000. Currency rate fluctuations attributable to the Company's
overseas operations decreased net sales by $7,834,000 in the current period.
Excluding the effects of currency rate fluctuations and the previously noted
divestiture of BSD, net sales would have increased by $3,014,000, which is
primarily the result of increased sales of spray dampening, inserters, and roll
handling equipment. In terms of local currency, and as compared to the same
period in the prior year, net sales decreased by 8.1% in the Americas. Sales
increased by 98.0% in China, by 53.4% in France, by 7.8% in Sweden, and by 6.7%
in Germany.
Gross profit for the nine month period ended March 31, 2001 was
$41,908,000 (30.3% of net sales), as compared to $46,795,000 (31.7% of net
sales) for the nine month period ended March 31, 2000, a decrease of $4,887,000
or 10.4%. Currency rate fluctuations decreased gross profit by $2,734,000 in the
current period. Otherwise gross profit would have decreased by $2,153,000 in the
current period. Gross profit as a percentage of net sales has decreased
primarily due to decreased sales volumes of higher margin products, increased
material and labor costs, primarily for cleaning products, and continuing
pricing pressures in the market.
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Selling, general and administrative expenses amounted to $28,230,000
(20.4% of net sales), for the nine month period ended March 31, 2001 as compared
to $31,403,000 (21.3% of net sales) for the same period in the prior year, a
decrease of $3,173,000 or 10.1%. Currency rate fluctuations decreased these
expenses by $1,213,000 in the current period. Otherwise, selling, general and
administrative expenses would have decreased by $1,960,000. Selling expenses
decreased by $1,093,000 which primarily related to decreased compensation,
marketing and trade show costs, while general and administrative expenses
decreased by $867,000 primarily due to the $1,100,000 bad debt charge in the
prior year period, partially offset by certain separation costs associated with
management changes in the current period.
Engineering and research and development expenses decreased by $424,000
over the same period in the prior year. Currency rate fluctuations decreased
these expenses by $785,000 in the current period. Otherwise, these expenses
would have increased by $361,000. The increase in these expenses relates
primarily to increased research and development labor and consulting costs
offset by reduced project material costs. As a percentage of net sales,
engineering and research and development expenses increased by 0.3% to 9.2% for
the nine months ended March 31, 2001 compared to 8.9% for the same period in the
prior year.
The Company recorded an initial restructuring charge of $5,490,000 for
the nine month period ended March 31, 2000 related to a restructuring plan
associated with the planned consolidation of production facilities, resulting in
a reduction in total employment, primarily in the United States. The
restructuring charge in the current year period relates to additional costs
associated with the restructuring plan, resulting from the discontinuance of a
product line.
The Company recorded a reduction to a reserve in the amount of $472,000
related to the sale of the Company's former Pre-Press Operations ("PPO"). The
initial charge of $2,400,000 was initially established in the third quarter of
fiscal year ended June 30, 1999, as a result of certain pension obligations
which were guaranteed by the Company. As more fully described in Note 7 to the
consolidated financial statements, the Company has made payments against this
obligation, and further reduced its obligation by $472,000 to the estimated
amount owed as of March 31, 2001.
Interest expense for the nine month period ended March 31, 2001 was
$1,663,000 as compared to $1,390,000 for the nine month period ended March 31,
2000. Currency rate fluctuations decreased interest expense by $138,000 in the
current period. Otherwise, interest expense would have increased by $411,000.
This increase was primarily due to higher long-term debt levels and higher
interest rates during the period. Interest income amounted to $231,000 and
$236,000 for the nine month periods ended March 31, 2001 and March 31, 2000,
respectively. This reduction in interest income is primarily due to decreased
cash balances available for investment purposes, which was partially offset by
higher interest rates in the current period. Currency rate fluctuations
decreased interest income by $34,000 in the current period.
Other income and expense includes net foreign currency transaction gains
(losses) of $389,000 and ($433,000) for the nine months ended March 31, 2001 and
2000, respectively. Currency rate fluctuations decreased other income by
$480,000 in the current period. The net foreign currency transaction gains in
the current period include a $345,000 gain on a derivative financial instrument
that did not qualify as a hedge pursuant to FAS 133, and a $34,000 loss on the
ineffective portions of derivative financial instruments which qualify as cash
flow hedges pursuant to FAS 133. Other income and expense also includes a
pre-tax gain of $1,213,000 related to a favorable settlement of a patent
litigation suit, and a $650,000 pre-tax loss on the sale of BSD.
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The Company's prior year effective tax rate was significantly impacted
by the recognition of a $4,147,000 net operating loss ("NOL") tax benefit.
The Company's effective tax rate on income before taxes was 42.0% for the nine
month period ended March 31, 2001, compared to 36.0% for the nine month period
ended March 31, 2000 (excluding the effect of the above noted NOL benefit).
Currency rate fluctuations decreased the provision for income taxes by $467,000
in the current period. The increase in the current period's effective tax rate
is primarily due to increased taxable income in higher tax jurisdictions in the
current period, and taxable dividends received from one of the Company's foreign
subsidiaries.
The Company's net income amounted to $2,139,000 for the nine month
period ended March 31, 2001, compared to $2,931,000 for the nine month period
ended March 31, 2000. This decrease of $792,000 or 27.0%, is primarily due to
reduced sales volumes and gross profit margins, and the sale of BSD and the
$95,000 restructuring charge in the current period and the $4,147,000 NOL tax
benefit recorded in the prior year period. These decreases were largely offset
by the previously noted gain from the patent litigation settlement, the gain on
the derivative financial instrument that ceased to qualify as a hedge pursuant
to FAS 133, the adjustment of the provision for the disposition of the PPO and
increased royalty income in the current period and the $5,490,000 restructuring
charge and the $1,100,000 bad debt charge, both in the prior year period.
Currency rate fluctuations decreased net income by $645,000 in the current
period. Net income per share amounted to $0.14 basic and diluted for the nine
months ended March 31, 2001, as compared to $0.19 basic and diluted for the nine
months ended March 31, 2000.
SEGMENT RESULTS
GRAPHIC PRODUCTS AND CONTROLS GROUP
Net sales for the nine months ended March 31, 2001 decreased by
$6,878,000, or 6.4%, to $100,366,000 from $107,244,000 for the nine months ended
March 31, 2000. Currency rate fluctuations attributable to the Company's
overseas operations decreased net sales for the current period by $6,693,000,
otherwise, net sales would have decreased by $185,000 in the current period.
This decrease is primarily the result of reduced sales prices and decreased
sales levels of cleaning and web control systems, largely offset by increased
sales levels of spray dampening equipment.
Operating income amounted to $4,188,000 (4.2% of net sales) for the nine
months ended March 31, 2001, as compared to $5,400,000 (5.0% of net sales) for
the same period in the prior year, a decrease of $1,212,000. Currency rate
fluctuations decreased the current year's operating income by $692,000,
otherwise operating income would have decreased by $520,000. This decrease is
primarily the result of the overall decrease in sales prices and sales levels
discussed above, coupled with increased engineering and research and development
expenses in the current period, largely offset by the restructuring charge
applicable to the segment in the amount of $2,928,000 in the prior year period.
MATERIAL HANDLING GROUP
Net sales for the nine months ended March 31, 2001 decreased by
$4,824,000, or 11.2%, to $38,350,000 from $43,174,000 for the nine months ended
March 31, 2000. Currency rate fluctuations attributable to the Company's
overseas operations decreased net sales for the current period by $1,141,000.
Excluding the effects of currency rate fluctuations and the previously noted
divestiture of BSD, net sales would have increased by $921,000. This increase is
primarily the result of the increased net sales related to the Company's
inseters and roll handling products.
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Operating income amounted to $3,330,000 (8.7% of net sales) for the nine
months ended March 31, 2001, as compared to an operating loss of $3,083,000
(7.1% of net sales) for the same period in the prior year, an increase of
$6,413,000. Currency rate fluctuations decreased the current year's operating
profit by $102,000. The increase is primarily the result of the restructuring
charge applicable to the segment in the amount of $2,276,000 and the $1,100,000
bad debt charge, both in the prior year period, and increased sales volumes of
roll handling equipment in Asia, and increased efficiencies as a result of the
Company's restructuring efforts primarily in the United States in the current
period.
THREE MONTHS ENDED MARCH 31, 2001 VS. THREE MONTHS ENDED MARCH 31, 2000
CONSOLIDATED RESULTS
Net sales for the three months ended March 31, 2001 decreased by
$3,136,000, or 6.2%, to $47,575,000 from $50,711,000 for the three months ended
March 31, 2000. Currency rate fluctuations attributable to the Company's
overseas operations decreased net sales by $2,996,000 in the current period and
the previously noted divestiture of BSD further reduced net sales by $3,070,000.
Otherwise, net sales would have increased by $2,930,000 or 5.8%, which is
primarily the result of increased sales volumes attributable to cleaning
products and inserters. In terms of local currency, and as compared to the same
period in the prior year, net sales decreased by 20.9% in the Americas. Sales
more than doubled in China, and increased by 127.3% in Germany, by 43.8% in
France, and by 21.8% in Sweden.
Gross profit for the three month period ended March 31, 2001 was
$14,065,000 (29.6% of net sales), as compared to $16,166,000 (31.9% of net
sales) for the three month period ended March 31, 2000, a decrease of $2,101,000
or 13.0%. Currency rate fluctuations decreased gross profit by $1,134,000 in the
current period. Otherwise gross profit would have decreased by $967,000 in the
current period. Gross profit was lower due primarily to decreased sales volumes,
and continuing pricing pressures in the market.
Selling, general and administrative expenses amounted to $9,781,000
(20.6% of net sales), for the three month period ended March 31, 2001 as
compared to $10,401,000 (20.5% of net sales) for the same period in the prior
year, a decrease of $620,000 or 6.0%. Currency rate fluctuations decreased these
expenses by $380,000 in the current period. Otherwise, selling, general and
administrative expenses would have decreased by $240,000. Selling expenses
decreased by $830,000 which primarily related to reduced compensation and
marketing and trade show costs, while general and administrative expenses
increased by $590,000 due primarily to increased compensation costs related to
certain separation costs associated with management changes in the current
period.
Engineering and research and development expenses decreased by $270,000
compared to the same period in the prior year. Currency rate fluctuations
decreased these expenses by $286,000 in the current period. Otherwise, these
expenses would have increased by $16,000. The increase in these expenses relates
primarily to increased research and development labor and travel costs. As a
percentage of net sales, engineering and research and development expenses
remained flat at 9.0% for each of the three months ended March 31, 2001 and
2000.
The Company recorded an initial restructuring charge of $5,490,000 for
the three month period ended March 31, 2000 related to a restructuring plan
associated with the planned consolidation of production facilities, resulting in
a reduction in total employment, primarily in the United States. The
restructuring charge in the current year period relates to additional costs
associated with the restructuring plan, resulting from the discontinuance of a
product line.
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The Company recorded a reduction to a reserve in the amount of $472,000
related to the sale of the PPO. This $472,000 is an adjustment to the reserve
which was initially established in the third quarter of fiscal year ended June
30, 1999, as a result of certain pension obligations which were guaranteed by
the Company. As more fully described in Note 7 to the consolidated financial
statements, the Company has made payments against this obligation, and further
reduced its obligation by $472,000 to the estimated amount owed as of March 31,
2001.
Interest expense for the three month period ended March 31, 2001 was
$627,000 as compared to $397,000 for the three month period ended March 31,
2000. This increase was primarily due to higher long-term debt levels and
increased interest rates during the current period. Currency rate fluctuations
decreased interest expense by $33,000 in the current period. Interest income
amounted to $74,000 and $67,000 for the three month periods ended March 31, 2001
and March 31, 2000, respectively. This increase in interest income is primarily
due to higher cash balances available for investment purposes and higher
interest rates during the period. Currency rate fluctuations decreased interest
income by $12,000 in the current period.
Other income and expense includes net foreign currency transaction
losses of $138,000 and $142,000 for the three months ended March 31, 2001 and
2000, respectively. Currency rate fluctuations increased other income by $82,000
in the current period.
The Company's prior year effective tax rate was significantly impacted
by the recognition of a $4,147,000 NOL benefit. The Company's effective tax rate
on income before taxes was 41.9% for the three month period ended March 31, 2001
as compared to 34.6% for the three month period ended March 31, 2000 (excluding
the effect of the above noted NOL benefit). Currency rate fluctuations decreased
the provision for income taxes by $190,000 in the current period. The increase
in the current period's effective tax rate is primarily due to increased taxable
income in higher tax jurisdictions in the current period, and a taxable dividend
received from one of the Company's foreign subsidiaries.
The Company's net income amounted to $332,000 for the three month period
ended March 31, 2001, as compared to $1,825,000 for the three month period ended
March 31, 2000. This decrease of $1,493,000 or 81.8%, is primarily due to
reduced sales volumes and gross profit margins, the $95,000 restructuring charge
and increased general and administrative expenses in the current year period and
the $4,147,000 NOL tax benefit recorded in the prior year period. These
decreases were offset by the adjustment of the provision for the disposition of
the PPO and increased royalty income in the current period and the $5,490,000
restructuring charge in the prior year period. Currency rate fluctuations
decreased net income by $152,000 in the current period. Net income per share
amounted to $0.02 basic and diluted for the three months ended March 31, 2001,
as compared to $0.12 basic and diluted for the three months ended March 31,
2000.
SEGMENT RESULTS
GRAPHIC PRODUCTS AND CONTROLS GROUP
Net sales for the three months ended March 31, 2001 increased by
$499,000, or 1.4%, to $36,816,000 from $36,317,000 for the three months ended
March 31, 2000. Currency rate fluctuations attributable to the Company's
overseas operations decreased net sales for the current period by $2,576,000,
otherwise, net sales would have increased by $3,075,000 or 8.5% in the current
period. This increase is primarily the result of increased sales of cleaning
products.
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Operating income amounted to $2,249,000 (6.1% of net sales) for the
three months ended March 31, 2001, as compared to $509,000 (1.4% of net sales)
for the same period in the prior year, an increase of $1,740,000. Currency rate
fluctuations decreased the current year's operating income by $475,000,
otherwise operating income would have increased by $2,215,000. This increase is
primarily the result of the restructuring charge applicable to the segment in
the amount of $2,928,000 in the prior year period.
MATERIAL HANDLING GROUP
Net sales for the three months ended March 31, 2001 decreased by
$4,124,000, or 27.5%, to $10,873,000 from $14,997,000 for the three months ended
March 31, 2000. Currency rate fluctuations attributable to the Company's
overseas operations decreased net sales for the current period by $420,000,
otherwise net sales would have decreased by $3,704,000. This decrease is
primarily the result of the reduction of net sales related to BSD, which
contributed sales of $3,070,000. The remaining decrease is primarily the result
of reduced sales of roll handling equipment.
Operating income amounted to $708,000 (6.5% of net sales) for the three
months ended March 31, 2001, as compared to an operating loss of $2,497,000
(16.6% of net sales) for the same period in the prior year, an increase of
$3,205,000. Currency rate fluctuations had a negligible effect on the current
year's operating profit. The increase is primarily the result of the
restructuring charge applicable to the segment of $2,276,000.
LIQUIDITY AND CAPITAL RESOURCES AT MARCH 31, 2001
LIQUIDITY AND WORKING CAPITAL
As of March 31, 2001, the Company maintained a $35,000,000 Revolving
Credit Facility (the "Credit Facility") with Fleet National Bank and First Union
National Bank which matures on October 31, 2003. The Credit Facility requires
the Company to maintain certain financial covenants. On April 27, 2001, the
Company entered into an interest rate swap agreement with Fleet National Bank to
fix the LIBOR portion of its interest rate at 4.98% for a principal amount of
$15,000,000 with the maturity the same as the Credit Facility.
The Company's working capital increased by $5,584,000 or 19.8% from
$28,221,000 at June 30, 2000 to $33,805,000 at March 31, 2001. Currency rate
fluctuations decreased working capital by $3,298,000 in the current period,
otherwise working capital would have increased by $8,882,000. The primary
reasons for the increase in working capital were increases in trade notes
receivable and prepaid expenses, and reductions in the current portion of
long-term debt. These increases in working capital were partially offset by
reductions in inventories and increases in income taxes payable.
Net cash provided by investing activities amounted to $1,762,000 for the
nine months ended March 31, 2001 as compared to net cash used by investing
activities of $2,611,000 for the nine months ended March 31, 2000. This increase
is primarily the result of the sale of BSD.
Net cash provided by financing activities amounted to $1,748,000 for the
nine months ended March 31, 2001 as compared to net cash used by financing
activities of $7,526,000 for the nine months ended March 31, 2000. This increase
in net cash provided by financing activities was primarily due to increased net
borrowings and decreased treasury stock purchases during the current period.
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On November 3, 1999, the Board of Directors had approved a new stock
repurchase program under which the Company is authorized to utilize up to
$5,000,000 to repurchase its Class A Common Stock. Under this program, the
Company repurchased 755,300 shares of Class A Common Stock for $1,662,000
through March 31, 2001. In addition, the Company repurchased 25,000 shares of
Class B Common Stock for $62,000 on December 31, 1999 from its former Chief
Financial Officer.
The Company maintains relationships with foreign and domestic banks
which have extended credit facilities to the Company. As of March 31, 2001,
these credit facilities total $48,306,000 including amounts available under the
Credit Facility. The Company had outstanding $22,306,000 under these lines of
credit, of which $17,250,000 is classified as long-term debt. Total debt levels
as reported on the balance sheet at March 31, 2001 are $915,000 lower due to the
effect of currency rate fluctuations.
The Company believes its cash flow from operations and bank lines of
credit are sufficient to finance its working capital and other capital
requirements for the near and long-term future.
EURO CONVERSION
Effective January 1, 1999, the "Euro" has become the new common currency
for 11 countries of the European Community (including Germany and France where
the Company has operations). Other member states (including the United Kingdom
and Sweden where the Company also has operations) may join in future years.
Beginning January 1, 1999, transactions in the Euro became possible, with the
national currencies continuing to circulate until January 1, 2002, when the Euro
will become the functional currency for these 11 countries. During the
transition period from January 1, 1999 to January 1, 2002, payments can be made
using either the Euro or the national currencies at fixed exchange rates.
Beginning January 1, 1999, the Company began conducting business with
customers in both the Euro and the respective national currency. Systems and
processes that are initially impacted by this dual currency requirement are
customer billing and receivables, payroll and cash management activities,
including cash collections and disbursements. To accomplish compliance, the
Company is making the necessary systems and process changes and is also working
with its financial institutions on various cash management issues. The Company's
German operations have begun recording all business transactions in the Euro
effective July 1, 2000. In France, the remaining affected country in which the
Company operates, the Company currently has new systems and processes in place
to accommodate the recording of all business transactions in the Euro, however,
the actual recording will not begin until July 1, 2001.
Management currently believes that the costs associated with
implementing and completing the Euro conversion, as well as business and market
implications, if any, associated with the Euro conversion, will not be material
to its results of operations or financial condition in any year or in the
aggregate. The competitive impact of increased cross-border price transparency,
however, is uncertain, both with respect to products sold by the Company, as
well as products and services purchased by the Company.
The Company's ongoing efforts with regard to the Euro conversion, and
those of its significant customers and suppliers, including financial
institutions may, at some time in the future, reveal as yet unidentified or not
fully understood issues that may not be addressable in a timely fashion, or that
may cause unexpected competitive or market effects, all contrary to the
foregoing statements. This issue, if not resolved favorably, could have a
material adverse effect on the Company's results of operations or financial
condition in a future period.
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IMPACT OF INFLATION
The Company's results are affected by the impact of inflation on
manufacturing and operating costs. Historically, the Company has used selling
price adjustments, cost containment programs and improved operating efficiencies
to offset the otherwise negative impact of inflation on its operations.
ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK:
A discussion of market risk exposures is included in Part II Item 7A,
"Quantitative and Qualitative Disclosures About Market Risk" of the Company's
Annual Report on Form 10-K for the year ended June 30, 2000. There have been no
material changes during the nine months ended March 31, 2001.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
10.41 Employment agreement dated and effective as of March 19, 2001
between Baldwin Technology Company, Inc. and Gerald A. Nathe
(filed herewith).
(b) Reports on Form 8-K. There were no reports on Form 8-K filed for the
three months ended March 31, 2001.
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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.
BALDWIN TECHNOLOGY COMPANY, INC.
BY /s/ James M. Rutledge
----------------------------
Vice President, Chief Financial
Officer and Treasurer
Dated: May 14, 2001
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