# Chicago Rivet & Machine Co: Form 10-Q for the period ended Mar 31, 2022

- Company: [Chicago Rivet & Machine Co](/companies/cvr.md) (CIK 19871)
- Form: 10-Q
- Filed: 2022-05-06
- Accepted by EDGAR: May 6, 2022, 16:01 ET
- Period: 2022-03-31
- Accession: 0001193125-22-143606
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/19871/000119312522143606/d341910d10q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/19871/000119312522143606/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2022-03-31.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2022-01-01 to 2022-03-31 | $9.2m | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax |
| Cost of revenue | 3 months, 2022-01-01 to 2022-03-31 | $7.3m | us-gaap:CostOfRevenue |
| Gross profit | 3 months, 2022-01-01 to 2022-03-31 | $1.9m | us-gaap:GrossProfit |
| Selling, general and administrative | 3 months, 2022-01-01 to 2022-03-31 | $1.3m | us-gaap:SellingGeneralAndAdministrativeExpense |
| Operating income | 3 months, 2022-01-01 to 2022-03-31 | $560.6k | us-gaap:OperatingIncomeLoss |
| Income tax | 3 months, 2022-01-01 to 2022-03-31 | $123.0k | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2022-01-01 to 2022-03-31 | $447.3k | us-gaap:NetIncomeLoss |
| Diluted shares (weighted) | 3 months, 2022-01-01 to 2022-03-31 | 966,132 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 3 months, 2022-01-01 to 2022-03-31 | −$388.4k | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 3 months, 2022-01-01 to 2022-03-31 | $120.6k | us-gaap:PaymentsToAcquireProductiveAssets |
| Dividends paid | 3 months, 2022-01-01 to 2022-03-31 | $212.5k | us-gaap:PaymentsOfDividendsCommonStock |
| Cash and equivalents | at 2022-03-31 | $1.3m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2022-03-31 | $20.7m | us-gaap:AssetsCurrent |
| Total assets | at 2022-03-31 | $33.0m | us-gaap:Assets |
| Current liabilities | at 2022-03-31 | $2.9m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2022-03-31 | $3.8m | us-gaap:Liabilities |
| Shareholders' equity | at 2022-03-31 | $29.2m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 6,514 characters.

Results of Operations

Net sales for the first quarter of 2022 were $9,197,696 compared to $9,304,949 in the first quarter of 2021, a decline of $107,253, or 1.2%. The modest decline was the primarily due to a lower average selling price on machines sold in the current year compared to the year earlier period. The lower sales combined with higher operating costs in the current year resulted in a lower net income of $447,313, or $0.46 per share, compared to $540,128, or $0.56 per share, in the first quarter of 2021. During the quarter, a regular quarterly dividend of $0.22 per share was paid.

Fastener segment revenues were $8,153,833 in the first quarter of 2022 compared to $8,148,678 in the first quarter of 2021, an increase of $5,155, or 0.1%. The automotive sector is the primary market for our fastener segment products and sales to automotive customers were $4,904,183 in the first quarter this year compared to $5,059,469 in the first quarter of 2021, a decline of $155,286, or 3.1%. This compares favorably to the 15.7% decline in North American light vehicle sales in the first quarter as the automotive industry continues to be negatively impacted by shortages of critical components. Fastener segment sales to non-automotive customers were $3,249,650 in the first quarter of this year compared to $3,089,209 in the first quarter of 2021, an increase of $160,441 or 5.2%. Fastener segment gross margins were $1,558,909 in the first quarter of 2022 compared to $1,656,629 in the first quarter of 2021, a decline of $97,720, or 5.9%. We have experienced price increases in various manufacturing costs, including steel, our primary raw material, which has increased approximately 37% compared to the first quarter of 2021.

Assembly equipment segment revenues were $1,043,863 in the first quarter of 2022 compared to $1,156,271 in the first quarter of 2021, a decline of $112,408, or 9.7%. The decline was primarily due to a lower average selling price on machines sold in the current year. Lower sales contributed to a $80,495 decline in segment gross margin from $377,808 in 2021 to $297,313 in 2022.

Selling and administrative expenses during the first quarter of 2022 were $1,295,664 compared to $1,362,201 recorded in the first quarter of 2021, a decrease of $66,537, or 4.9%. The decrease was primarily due to a reduction in payroll expense compared to the year earlier quarter. Selling and administrative expenses declined to 14.1% of net sales in the first quarter of 2022 from 14.6% in the first quarter of 2021.

Other Income

Other income in the first quarter of 2022 was $9,755 compared to $17,892 in the first quarter of 2021. The decrease is primarily related to a reduction in interest income on certificates of deposit due to lower interest rates and lower balances invested in the current year.

Income Tax Expense

The Company’s effective tax rates were approximately 21.6% and 21.7% for the first quarter of 2022 and 2021, respectively.

Liquidity and Capital Resources

Working capital improved to $17,832,179 as of March 31, 2022 compared to $17,421,585 at the beginning of the year. During the quarter, accounts receivable increased by $990,427, due to the greater sales activity during the quarter compared to the fourth quarter of 2021, and inventory increased by $1,093,460 due to higher raw material prices and the increase in quantities on hand to minimize supply disruptions. Partially offsetting these changes were increases in accounts payable and accrued expenses related to the greater level of operating activity during the first quarter. Other items impacting working capital in the first quarter were capital expenditures of $120,594, which consisted primarily of equipment used in fastener production activities, and dividends paid of $212,549. The net result of these changes and other cash flow activity was to leave cash, cash equivalents and certificates of deposit at $4,056,417 as of March 31, 2022 compared to $4,777,954 as of the beginning of the year. Management believes that current cash, cash equivalents and operating cash flow will provide adequate working capital for the next twelve months.

Results of Operations Summary

Results in the first quarter reflected steady demand overall, but demand from automotive customers, our primary customer market, was constrained by continued pandemic-fueled chip and parts shortages. These conditions are expected to persist in the near-term. Higher operating costs related to accelerating inflation and a tight labor market further weighed on results during the quarter. Cost increases can be difficult to recover and further increases are expected. These factors, as well as lingering uncertainties related to COVID-19, are expected to continue to present challenges in the near-term. As we face these challenges, we will make adjustments to our activities which we believe are necessary based on market conditions, while continuing to pursue opportunities to develop new customer relationships and build on existing ones in all the markets we serve.

#### Forward-Looking Statements

*This discussion contains certain "forward-looking statements" which are inherently subject to risks and uncertainties that may cause actual events to differ materially from those discussed herein. Factors which may cause such differences in events include, those disclosed under "Risk Factors" in our Annual Report on Form 10-K and in the other filings we make with the United States Securities and Exchange Commission. These factors, include among other things: risk related to the COVID-19 pandemic and its related adverse effects, conditions in the domestic automotive industry, upon which we rely for sales revenue, the intense competition in our markets, the concentration of our sales with major customers, risks related to export sales, the price and availability of raw materials, supply chain disruptions, labor relations issues, losses related to product liability, warranty and recall claims, costs relating to environmental laws and regulations, information systems disruptions, the loss of the services of our key employees and difficulties in achieving cost savings. Many of these factors are beyond our ability to control or predict. Readers are cautioned not to place undue reliance on these forward-looking statements. We undertake no obligation to publish revised forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.*

## Controls and procedures

As filed, 1,327 characters.

(a) Disclosure Controls and Procedures. The Company's management, with the participation of the Company's Chief Executive Officer and President, Chief Operating Officer and Treasurer (the Company’s principal financial officer), has evaluated the effectiveness of the Company's disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end of the period covered by this report. Based on such evaluation, the Company's Chief Executive Officer and President, Chief Operating Officer and Treasurer have concluded that, as of the end of such period, the Company's disclosure controls and procedures are effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act.

(b) Internal Control Over Financial Reporting. There have not been any changes in the Company's internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Filed May 6, 2022.
Source: SEC EDGAR, the filing index for accession 0001193125-22-143606. Last ingested by Listed: Nov 6, 2026, 13:17 ET. No prices; not investment advice.