10-Q/A 1 j1183001e10vqza.txt RADVA CORPORATION U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDED FORM 10-Q -------------------------------------------- Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 -------------------------------------------- For Quarterly Period Commission File ended March 31, 2004 Number 0-15464 RADVA CORPORATION (Exact name of small business issuer as specified in its charter) VIRGINIA 54-0715892 (State of other jurisdiction of (IRS Employer incorporation or organization) Identification Number) Drawer 2900 FSS Radford, Virginia 24143 (Address of principal executive offices) Issuer's telephone number, including area code (540) 639-2458 Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- Applicable only to corporate issuers: State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 3,987,987 ---------- Transitional Small Business Disclosure Format: Yes No X --- --- RADVA CORPORATION INDEX Page Number ------ PART I. FINANCIAL INFORMATION: INDEPENDENT ACCOUNTANTS' REPORT 3 Item 1. Financial Statements Balance Sheets, December 31, 2003 and March 31, 2004 4 Statements of Operations, Three Months Ended March 31, 2003 and March 31, 2004 5 Statements of Cash Flows, Three Months Ended March 31, 2003 and March 31, 2004 6 Notes to Financial Statements 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 8 PART II. OTHER INFORMATION 9 - 2 - PERSINGER & COMPANY, L.L.C. Certified Public Accountants 203 W. Grayson Street Tel. (276) 236-8135 P.O. Box 797 Fax (276) 236-0797 Galax, VA 24333 Independent Accountants' Report Board of Directors RADVA Corporation Radford, Virginia We have reviewed the accompanying condensed consolidated balance sheet of Radva Corporation and subsidiary as of March 31, 2004, and the related condensed consolidated statements of income and cash flows for the three-month period ended March 31, 2004. These financial statements are the responsibility of the Corporation's management. We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures to financial data and of making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to such condensed consolidated financial statements for them to be in conformity with generally accepted accounting principles. We have previously audited, in accordance with generally accepted auditing standards, the consolidated balance sheet of Radva Corporation and subsidiary as of December 31, 2003, and the related consolidated statements of income, stockholders' equity, and cash flows for the year then ended (not presented herein); and in our report dated February 13, 2004, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2003 is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived. Galax, Virginia May 12, 2004 - 3 - RADVA CORPORATION Balance Sheets (Unaudited) (In Thousands)

See accountants' report and accompanying notes to financial statements. - 4 - RADVA CORPORATION Statements of Operations Three Months Ended March 31 (Unaudited) (In Thousands, except per share data)

See accountants' report and accompanying notes to financial statements. - 5 - RADVA CORPORATION Statements of Cash Flows Three Months Ended March 31 (Unaudited) (In Thousands)

See accountants' report and accompanying notes to financial statements. - 6 - RADVA CORPORATION Notes to Financial Statements March 31, 2004 (1) General The financial statements conform to generally accepted accounting principles and to general industry practices. The financial statements are unaudited. However, in the opinion of management, all adjustments which are normal and necessary for a fair presentation of the financial statements have been included. (2) Property, Plant and Equipment A summary of property, plant and equipment follows: Land and improvements............................. $ 169,565 Buildings and improvements........................ 3,140,772 Machinery and equipment........................... 5,711,587 Transportation equipment.......................... 372,130 Office equipment.................................. 319,013 ---------- $9,713,067 ========== (3) Accrued Expenses Accrued expenses are comprised of the following: Payroll and employment benefits................... $ 159,696 Other............................................. 77,808 ---------- $ 237,504 ========== (4) Notes Payable Notes payable to related parties.................. 223,734 Line of credit with commercial bank, $1,500,000 limit, interest variable (4.00% at March 31, 2004)......................... $ 762,411 ---------- $ 986,145 ========== (5) Long-term Debt A summary of long-term debt follows: Installment note payable to bank, due in variable monthly installments, including interest at prime plus 2.25% (6.25% at March 31, 2004); collateralized by all of the company's assets. 1,895,144 Installment note payable to bank, due in monthly installments of $17,402, including interest at prime plus 2.25% (6.25% at March 31, 2004); collateralized by all of the company's assets. 1,174,251 Installment note payable to bank, due in variable monthly installments, including interest at prime plus 1.25% (5.25% at March 31, 2004); collateralized by equipment 89,033 Installment note payable to bank, due in monthly installments of $527, including interest at 9.5%; collateralized by equipment. 3,574 ---------- Total long-term debt 3,162,002 Less current installments of long-term debt 106,484 ---------- Long-term debt, excluding current installments $3,055,518 ========== - 7 - Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations The Company's net revenues decreased $375,000 or 13.5% in the first quarter of 2004, as compared to the first quarter of 2003, resulting in a $93,000 reduction in operating income. The reduction in revenue was the result of a $731,000 reduction in sales to the Company's largest customer who is closing its operations being serviced by the Company. This customer accounted for 37.8% of the Company's net revenue in 2003. Cost of sales, as a percentage of revenues, increased 4.6% to 79.6% for the first quarter of 2004. This increase was primarily the result of the relationship of fixed cost due to a $610,000 reduction in production at the Company's Portsmouth plant. Natural gas cost was also up 3.1% of production at the Portsmouth plant. Shipping and selling expenses were down $53,000 or .4% or revenues for the first quarter of 2004 compared to the first quarter of 2003. General and administrative expenses were down $63,000 or 1% of revenues for the first quarter of 2004 compared to the first quarter of 2003 due to many factors including salary reductions. Liquidity and Capital Resources At March 31, 2004 the balance available on the Company's $1,500,000 line of credit was $226,729 and working capital was $402,000. In February 2004 the Company refinanced its line of credit with a new lender, reducing its interest rate by 2.25% to prime. However, the refinancing did reduce the Company's availability on its line of credit by the elimination of inventory from the collateral base on which the line of credit is secured. - 8 - PART II: OTHER INFORMATION Item 1. Legal Proceedings See item 3 of the Company's Form 10-K for the fiscal year ended December 31, 2003. Item 2. Changes in Securities and Use of Proceeds Not applicable. Item 3. Defaults Upon Senior Securities Not applicable. Item 4. Submission of Matters to a Vote of Securities Holders Not applicable. Item 5. Other Information The Company's chief executive officer and chief financial officer have concluded that the company's "disclosure controls and procedures" (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) are effective at the end of the quarterly period covered by this report. Item 6. Exhibits and Reports on Form 8-K Exhibits 31.1 Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer. 31.2 Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer. 32 Section 1350 Certifications Pursuant to the requirements of the Securities Exchange Act of 1934,this form 10-Q has been signed on behalf of the Registrant by its Assistant Secretary/Treasurer who is authorized to sign on behalf of the Registrant. RADVA CORPORATION /s/ William F. Fry ----------------------------- William F. Fry Secretary/Treasurer May 7, 2004 - 9 -

RADVA CORP 10-Q/A