MOCO » Topics » Significant Transactions and Financial Trends

These excerpts taken from the MOCO 10-K filed Mar 31, 2009.

Significant Transactions and Financial Trends

        Throughout these financial sections, you will read about significant transactions or events that materially contribute to, or reduce our earnings, and materially affect our financial results and financial position. Significant transactions and events that affected our 2008 financial results and position included the moving of our German office to a new facility. Significant transactions, such as the sale of our Lab Connections subsidiary in 2006, result from unique facts and circumstances and, given their nature, some of these items will likely not recur with similar materiality or impact on our continuing operations.

        Our international sales have historically accounted for a significant portion of our revenues, and we expect our international sales, as a percentage of total sales, to continue to increase for the foreseeable future.

        Our research and development costs were approximately 7% of our consolidated sales for the years 2008, 2007 and 2006. On an annual basis, we intend to spend approximately 6% to 8% of our sales on research and development in the future.

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        While these items are important in understanding and evaluating our financial results, certain trends, such as our international sales accounting for a significant portion of our revenues, and other transactions or events such as those discussed later in this Management's Discussion and Analysis may also have a material impact on our financial results.

Significant Transactions and Financial Trends



        Throughout these financial sections, you will read about significant transactions or events that materially contribute to, or reduce
our earnings, and materially affect our financial results and financial position. Significant transactions and events that affected our 2008 financial results and position included the moving of our
German office to a new facility. Significant transactions, such as the sale of our Lab Connections subsidiary in 2006, result from unique facts and circumstances and, given their nature, some of these
items will likely not recur with similar materiality or impact on our continuing operations.



        Our
international sales have historically accounted for a significant portion of our revenues, and we expect our international sales, as a percentage of total sales, to continue to
increase for the foreseeable future.



        Our
research and development costs were approximately 7% of our consolidated sales for the years 2008, 2007 and 2006. On an annual basis, we intend to spend approximately 6% to 8% of our
sales on research and development in the future.



16









        While
these items are important in understanding and evaluating our financial results, certain trends, such as our international sales accounting for a significant portion of our
revenues, and other transactions or events such as those discussed later in this Management's Discussion and Analysis may also have a material impact on our financial results.



These excerpts taken from the MOCO 10-K filed Mar 31, 2008.

Significant Transactions and Financial Trends

        Throughout these financial sections, you will read about significant transactions or events that materially contribute to, or reduce our earnings, and materially affect our financial results and financial position. Significant transactions and events that affected our 2007 financial results and position included the initial opening and ongoing expenses of our new China sales and technical support office which opened in March 2007. In addition, we recognized an increase in SOX 404 compliance costs as this was the first year of required management assessment of internal controls. Significant transactions, such as the sale of our Lab Connections subsidiary in 2006, result from unique facts and circumstances and, given their nature, some of these items will likely not recur with similar materiality or impact on our continuing operations.

        Our international sales have historically accounted for a significant portion of our revenues, and we expect this trend to continue for the foreseeable future, especially as a result of our acquisition of Lippke, which thus far has had, and is expected to continue to have, a positive impact on our sales and earnings, particularly on our foreign permeation products business.

        Our research and development costs were approximately 7% of our consolidated sales for the years 2007, 2006 and 2005. On an annual basis, we currently intend to spend approximately 6% to 8% of our sales on research and development in the future.

        While these items are important in understanding and evaluating our financial results, certain trends, such as our international sales accounting for a significant portion of our revenues, and other transactions or events such as those discussed later in this Management's Discussion and Analysis may also have a material impact on our financial results.

Significant Transactions and Financial Trends



        Throughout these financial sections, you will read about significant transactions or events that materially contribute to, or reduce our earnings, and materially
affect our financial results and financial position. Significant transactions and events that affected our 2007 financial results and position included the initial opening and ongoing expenses of our
new China sales and technical support office which opened in March 2007. In addition, we recognized an increase in SOX 404 compliance costs as this was the first year of required management assessment
of internal controls. Significant transactions, such as the sale of our Lab Connections subsidiary in 2006, result from unique facts and circumstances and, given their nature, some of these items will
likely not recur with similar materiality or impact on our continuing operations.



        Our
international sales have historically accounted for a significant portion of our revenues, and we expect this trend to continue for the foreseeable future, especially as a result of
our acquisition of Lippke, which thus far has had, and is expected to continue to have, a positive impact on our sales and earnings, particularly on our foreign permeation products business.




        Our
research and development costs were approximately 7% of our consolidated sales for the years 2007, 2006 and 2005. On an annual basis, we currently intend to spend approximately 6% to
8% of our sales on research and development in the future.



        While
these items are important in understanding and evaluating our financial results, certain trends, such as our international sales accounting for a significant portion of our
revenues, and other transactions or events such as those discussed later in this Management's Discussion and Analysis may also have a material impact on our financial results.




This excerpt taken from the MOCO 10-K filed Mar 30, 2007.

Significant Transactions and Financial Trends

Throughout these financial sections, you will read about significant transactions or events that materially contribute to, or reduce our earnings, and materially affect our financial results and financial position. Significant transactions and events that affected our 2006 financial results and position included the $92,345 gain recorded in the first quarter relating to the sale of our Lab Connections subsidiary as well as a $50,000 reduction in income tax expense due to a favorable settlement with a state taxing jurisdiction. In addition, we recognized a non-cash pre-tax expense of $187,553 in 2006 relating to the new stock option expensing rules which became effective for us on January 1, 2006. Significant transactions, such as the sale of our Lab Connections subsidiary, result from unique facts and circumstances and, given their nature, some of these items will likely not recur with similar materiality or impact on our continuing operations.

Our international sales have historically accounted for a significant portion of our revenues, and we expect this trend to continue for the foreseeable future, especially as a result of our acquisition of Lippke, which thus far has had, and is expected to continue to have, a positive impact on our sales and earnings, particularly on our foreign permeation products business.

Our research and development costs were approximately 7% of our consolidated sales for 2006 and approximately 7% and 6% of our consolidated sales for 2005 and 2004, respectively. We currently intend to spend, on an annual basis, approximately 6% to 8% of our sales on research and development.

While these items are important in understanding and evaluating our financial results, certain trends, such as the increase in the proportion of our international sales over the past three years, and other transactions or events such as those discussed later in this Management’s Discussion and Analysis may also have a material impact on our financial results.

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This excerpt taken from the MOCO 10-K filed Mar 31, 2006.
Significant Transactions and Financial Trends

Throughout these financial sections, you will read about significant transactions or events that materially contribute to, or reduce our earnings, and materially affect our financial results and financial position. Significant transactions and events that affected our 2005 financial results and position included the $207,000 charge to earnings we recorded in the first quarter 2005 to reflect the results of operations and asset impairment write-down associated with the discontinuation of our Vaculok business and the $240,000 charge we recorded in fourth quarter 2004 for the impairment of intangible technology rights associated with our Lab Connections, Inc. subsidiary. Significant transactions, such as our sale of our vacuum insulated panel line, result from unique facts and circumstances and, given their nature, some of these items will likely not recur with similar materiality or impact on our continuing operations.

Our international sales have historically accounted for a significant portion of our revenues, and despite the two percentage point decrease of our foreign sales to our total sales in 2005 compared to 2004, we expect this trend to continue for the foreseeable future, especially as a result of our acquisition of Lippke, which thus far has had, and is expected to continue to have, a positive impact on our sales and earnings, particularly on our foreign permeation products business.

Our research and development costs were approximately 7% of our consolidated sales for 2005 and approximately 6% and 7% of our consolidated sales for 2004 and 2003, respectively. For the foreseeable future, we expect to spend, on an annual basis, approximately 6% to 8% of our sales on research and development.

While these items are important in understanding and evaluating our financial results, certain trends, such as the increase in the proportion of our international sales over the past three years and the increase in our research and development spending, and other transactions or events such as those discussed later in this Management’s Discussion and Analysis may also have a material impact on our financial results.

This excerpt taken from the MOCO 10-K filed Mar 31, 2005.
Significant Transactions and Financial Trends

Throughout these financial sections, you will read about significant transactions or events that materially contribute to, or reduce, our earnings, and materially affect our financial trends. Significant transactions and events that affected our 2004 financial results and position included the acquisition of Paul Lippke Handels-GmbH Prozess- und Laborsysteme (Lippke) in Germany, an impairment charge related to intangible technology rights associated with our Lab Connections, Inc. (LCI) subsidiary, and the movement of all of LCI’s, and a significant portion of our Baseline-MOCON, Inc. subsidiary’s, production to our main manufacturing facility in Minneapolis, Minnesota, along with the costs associated with these moves.

These significant transactions result from unique facts and circumstances and, given their nature, some of these items will likely not recur with similar materiality or impact on our continuing operations. While these items are important in understanding and evaluating our financial results and trends, other transactions or events such as those discussed later in this Management’s Discussion and Analysis may also have a material impact on financial trends.

Prior to 1998, we expanded our business primarily through internally developing new products and technologies, acquiring product lines and technology, and licensing our products and technology. Since 1998, we have supplemented our internal growth through a total of five acquisitions that have provided us with additional technologies, products and product development expertise.

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We completed our most recent acquisition effective January 1, 2004, by acquiring Paul Lippke Handels-GmbH Prozess- und Laborsysteme (Lippke), which is located in Germany. Lippke had been the primary distributor of our products in Europe for approximately 30 years, and also served in the capacity of distributor or agent for several companies in addition to MOCON. Our acquisition of Lippke provides us with a direct presence in Europe. We acquired all of the shares of Lippke for a base purchase price of $802,688. In addition, we are obligated to make three future “earnout” payments to Lippke’s former parent company based on the net profits of Lippke in each of the years 2004, 2005, and 2006, with a minimum payment amount of 100,000 euros per year. It is anticipated that the “earnout” payments will be made to the former parent company of Lippke at or near the end of the first quarter of each of the years 2005, 2006, and 2007. The earnout payment due for 2004 based on Lippke’s 2004 net profits is $549,257.

Our international sales have historically accounted for a significant portion of our revenues, and we expect this trend to continue for the foreseeable future, especially as a result of our acquisition of Lippke, which thus far has had, and is expected to continue to have, a positive impact on our sales, particularly on our foreign permeation products sales.

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