##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-QSB
 (Mark One)
 þ
    
    Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended August 31, 2007
 or
 o
    
    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: 1-13484
 COHESANT TECHNOLOGIES INC.
  Delaware
    
    34-1775913(State or other jurisdiction of
    
    (I.R.S. EmployerIncorporation or organization)
    
    Identification No.)
 5845 West 82nd Street, Suite 102, Indianapolis, Indiana
    
    46278(Address of principal executive offices)
    
    (Zip Code)
 317-871-7611
 
  þ o
 o þ
  o þ




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##### 



COHESANT TECHNOLOGIES INC.
 INDEX
 TABLE OF CONTENTS
    
    PAGEPART IItem 1. Financial InformationCohesant Technologies Inc. Condensed Consolidated
Balance Sheets as of August 31, 2007 and November 30, 2006
    
    
    3Cohesant Technologies Inc. Condensed Consolidated
Statements of Operations for the Three Months Ended
August 31, 2007 and August 31, 2006
    
    
    4Cohesant Technologies Inc. Condensed Consolidated
Statements of Operations for the Nine Months Ended
August 31, 2007 and August 31, 2006
    
    
    5Cohesant Technologies Inc. Condensed Consolidated
Statements of Cash Flows for the Nine Months Ended
August 31, 2007 and August 31, 2006
    
    
    6Notes to Condensed Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition
and Results of Operations
    
    
    18Item 3. Controls and Procedures
    
    
    23PART IIItem 4. Submission of Matters to Vote of Security Holders
    
    
    24Item 6. Exhibits and Reports on Form 8-K
    
    
    24SignaturesEX-31.1EX-31.2EX-32
  2




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##### Table of Contents



PART I
 
 ITEM 1. FINANCIAL INFORMATION
 COHESANT TECHNOLOGIES INC.
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 August 31, 2007
    
    
    November 30, 2006(Unaudited)ASSETS:Cash and cash equivalents
    
    $
    465,658
    
    
    $
    1,318,607Accounts receivable, net of allowance for doubtful
accounts of $348,598 and $282,415, respectively
    
    
    6,194,438
    
    
    
    4,517,316Note receivable
    
    
    131,092
    
    
    
    Inventories, net of allowance for obsolete and slow-moving
inventory of $289,491 and $285,000, respectively
    
    
    4,331,225
    
    
    
    3,944,818Costs in excess of billings and estimated earnings
    
    
    
    
    
    
    52,805Prepaid expenses and other
    
    
    476,273
    
    
    
    490,408Deferred tax assets
    
    
    397,748
    
    
    
    318,766Total Current Assets
    
    
    11,996,434
    
    
    
    10,642,720Property and equipment, net
    
    
    2,821,832
    
    
    
    2,424,983License agreements, patents and other intangibles, net
    
    
    1,065,957
    
    
    
    1,125,419Goodwill
    
    
    8,767,563
    
    
    
    8,767,563Other noncurrent assets
    
    
    7,965
    
    
    
    7,965Total Assets
    
    $
    24,659,751
    
    
    $
    22,968,650LIABILITIES AND SHAREHOLDERS EQUITY:Accounts payable
    
    $
    2,498,225
    
    
    $
    2,073,649Revolving credit facility
    
    
    867,276
    
    
    
    Current portion of long-term note payable
    
    
    127,410
    
    
    
    122,604Accrued salaries, benefits and commissions
    
    
    798,521
    
    
    
    877,224Accrued income taxes
    
    
    262,849
    
    
    
    402,165Billings in excess of costs and estimated earnings
    
    
    122,304
    
    
    
    49,224Customer deposits
    
    
    19,400
    
    
    
    204,128Other current liabilities
    
    
    528,472
    
    
    
    331,627Total Current Liabilities
    
    
    5,224,457
    
    
    
    4,060,621Long-term note payable, net of current portion
    
    
    168,729
    
    
    
    264,896Deferred tax liabilities
    
    
    735,556
    
    
    
    527,156Total Liabilities
    
    
    6,128,742
    
    
    
    4,852,673Commitments and Contingencies (Note 10)Shareholders Equity:Common stock ($.001 par value, 10,000,000 shares
authorized and 3,299,778 and 3,274,905 shares issued
and outstanding, respectively)
    
    
    3,300
    
    
    
    3,275Additional paid-in capital
    
    
    12,389,445
    
    
    
    12,008,087Accumulated other comprehensive income
    
    
    63,545
    
    
    
    24,302Retained earnings
    
    
    6,074,719
    
    
    
    6,080,313Total Shareholders Equity
    
    
    18,531,009
    
    
    
    18,115,977Total Liabilities and Shareholders Equity
    
    $
    24,659,751
    
    
    $
    22,968,650
  3




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 For the Three Months EndedAugust 31, 2007
    
    
    August 31, 2006NET SALES
    
    $
    8,336,036
    
    
    $
    6,370,753COST OF SALES
    
    
    4,435,532
    
    
    
    3,362,318Gross profit
    
    
    3,900,504
    
    
    
    3,008,435RESEARCH AND DEVELOPMENT EXPENSES
    
    
    337,674
    
    
    
    310,359SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    2,810,336
    
    
    
    2,099,524TOTAL OPERATING EXPENSES
    
    
    3,148,010
    
    
    
    2,409,883Income from operations
    
    
    752,494
    
    
    
    598,552OTHER INCOME (EXPENSE):Interest expense
    
    
    (22,247
    )
    
    
    Interest income
    
    
    214
    
    
    
    2,595Other income, net
    
    
    2,824
    
    
    
    9,973INCOME BEFORE TAXES
    
    
    733,285
    
    
    
    611,120INCOME TAX PROVISION
    
    
    (301,842
    )
    
    
    (232,147
    )NET INCOME
    
    $
    431,443
    
    
    $
    378,973EARNINGS PER COMMON SHARE:BASIC
    
    $
    0.13
    
    
    $
    0.12DILUTED
    
    $
    0.13
    
    
    $
    0.12AVERAGE SHARES OF COMMON STOCK
OUTSTANDING:BASIC
    
    
    3,295,352
    
    
    
    3,151,045DILUTED
    
    
    3,314,990
    
    
    
    3,284,140COMPREHENSIVE INCOME:Net income
    
    $
    431,443
    
    
    $
    378,973Foreign currency translation adjustment
    
    
    9,067
    
    
    
    (11,780
    )COMPREHENSIVE INCOME
    
    $
    440,510
    
    
    $
    367,193
  4




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
 For the Nine Months EndedAugust 31, 2007
    
    
    August 31, 2006NET SALES
    
    $
    21,881,265
    
    
    $
    19,628,750COST OF SALES
    
    
    12,232,419
    
    
    
    10,624,739Gross profit
    
    
    9,648,846
    
    
    
    9,004,011RESEARCH AND DEVELOPMENT EXPENSES
    
    
    1,005,664
    
    
    
    861,305SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    7,839,640
    
    
    
    6,140,511TOTAL OPERATING EXPENSES
    
    
    8,845,304
    
    
    
    7,001,816Income from operations
    
    
    803,542
    
    
    
    2,002,195OTHER INCOME (EXPENSE):Interest expense
    
    
    (40,153
    )
    
    
    Interest income
    
    
    756
    
    
    
    14,364Other income, net
    
    
    8,969
    
    
    
    17,150INCOME BEFORE TAXES
    
    
    773,114
    
    
    
    2,033,709INCOME TAX PROVISION
    
    
    (316,977
    )
    
    
    (772,810
    )NET INCOME
    
    $
    456,137
    
    
    $
    1,260,899EARNINGS PER COMMON SHARE:BASIC
    
    $
    0.14
    
    
    $
    0.40DILUTED
    
    $
    0.14
    
    
    $
    0.39AVERAGE SHARES OF COMMON STOCK
OUTSTANDING:BASIC
    
    
    3,285,419
    
    
    
    3,135,317DILUTED
    
    
    3,310,568
    
    
    
    3,262,860CASH DIVIDENDS PER SHARE
    
    $
    0.14
    
    
    $
    0.14COMPREHENSIVE INCOME:Net income
    
    $
    456,137
    
    
    $
    1,260,899Foreign currency translation adjustment
    
    
    39,243
    
    
    
    22,559COMPREHENSIVE INCOME
    
    $
    495,380
    
    
    $
    1,283,458
  5




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 For the Nine Months EndedAugust 31, 2007
    
    
    August 31, 2006CASH FLOWS PROVIDED BY (USED IN)
OPERATING ACTIVITIES:Net income
    
    $
    456,137
    
    
    $
    1,260,899Adjustments to reconcile net income to net cash
provided by (used in) operating activities -Depreciation and amortization
    
    
    608,864
    
    
    
    362,609Stock-based compensation
    
    
    259,560
    
    
    
    97,155Deferred tax provision
    
    
    129,418
    
    
    
    Excess tax benefits from stock-based compensation
    
    
    (24,641
    )
    
    
    Loss on asset disposal
    
    
    1,000
    
    
    
    1,090Provision for doubtful accounts
    
    
    66,183
    
    
    
    28,175Net change in assets and liabilities-Accounts receivable
    
    
    (1,743,305
    )
    
    
    (486,598
    )Note receivable
    
    
    (131,092
    )
    
    
    Inventories
    
    
    (477,801
    )
    
    
    (551,587
    )Costs in excess of billings and estimated earnings
    
    
    52,805
    
    
    
    Prepaid expenses and other
    
    
    14,135
    
    
    
    (132,892
    )Accounts payable
    
    
    424,576
    
    
    
    104,746Other current liabilities
    
    
    (181,261
    )
    
    
    (144,534
    )Billings in excess of costs and estimated earnings
    
    
    73,080
    
    
    
    (102,143
    )Other noncurrent assets
    
    
    25,441
    
    
    
    (7,080
    )Net cash provided by (used in) operating activities
    
    
    (446,901
    )
    
    
    429,840CASH FLOWS USED IN INVESTING ACTIVITIES:Patent and trademark additions
    
    
    (33,387
    )
    
    
    (19,835
    )Property and equipment additions
    
    
    (808,668
    )
    
    
    (1,260,415
    )Proceeds from sale of property & equipment
    
    
    
    
    
    
    350Payment to former owners of acquired CuraFlo business
    
    
    
    
    
    
    (342,136
    )Return of cash paid for acquisition of CuraFlo
    
    
    
    
    
    
    77,250Net cash used in investing activities
    
    
    (842,055
    )
    
    
    (1,544,786
    )CASH FLOWS PROVIDED BY (USED IN) FINANCING
ACTIVITIES:Proceeds from note receivable  restricted stock
    
    
    
    
    
    
    40,262Excess tax benefits from stock-based compensation
    
    
    24,641
    
    
    
    Borrowings under revolving credit facility
    
    
    5,321,470
    
    
    
    Payment on Triton acquisition note payable
    
    
    (91,361
    )
    
    
    Payments under revolving credit facility
    
    
    (4,454,194
    )
    
    
    Proceeds from exercise of stock options
    
    
    97,182
    
    
    
    109,158Cash dividends paid to shareholders
    
    
    (461,731
    )
    
    
    (446,382
    )Net cash provided by (used in) financing activities
    
    
    436,007
    
    
    
    (296,962
    )NET DECREASE IN CASH
AND CASH EQUIVALENTS
    
    
    (852,949
    )
    
    
    (1,411,908
    )CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD
    
    
    1,318,607
    
    
    
    2,238,281CASH AND CASH EQUIVALENTS AT
END OF PERIOD
    
    $
    465,658
    
    
    $
    826,373
  6




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Note 1  Background
      7




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Note 2  Basis of Presentation
    Note 3  Revenue Recognition
    8




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
  Note 4  Triton Acquisition
  Note 5  Earnings per Share
   9




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Three Months Ended August 31,
    
    
    Nine Months Ended August 31,2007
    
    
    2006
    
    
    2007
    
    
    2006Income available to common
stockholders
    
    $
    431,443
    
    
    $
    378,973
    
    
    $
    456,137
    
    
    $
    1,260,899Basic earnings per share:Weighted-average number of
common shares outstanding
    
    
    3,295,352
    
    
    
    3,151,045
    
    
    
    3,285,419
    
    
    
    3,135,317Basic earnings per share
    
    $
    0.13
    
    
    $
    0.12
    
    
    $
    0.14
    
    
    $
    0.40Diluted earnings per share:Weighted-average number of
common shares outstanding
    
    
    3,295,352
    
    
    
    3,151,045
    
    
    
    3,285,419
    
    
    
    3,135,317Stock Options
    
    
    16,478
    
    
    
    103,707
    
    
    
    22,105
    
    
    
    100,558Restricted Stock
    
    
    3,160
    
    
    
    29,388
    
    
    
    3,044
    
    
    
    26,985Diluted weighted-average
number of
common shares outstanding
    
    
    3,314,990
    
    
    
    3,284,140
    
    
    
    3,310,568
    
    
    
    3,262,860Diluted earnings per share
    
    $
    0.13
    
    
    $
    0.12
    
    
    $
    0.14
    
    
    $
    0.39
 Note 6  Accounting for Stock-Based Compensation
 Description of the Plan
  Adoption of FASB Statement No. 123(R), Share-Based Payment
 Share-Based Payment Accounting for Stock-Based
Compensation, Accounting for Stock Issued to Employees, Statement of Cash Flows.
 10




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
     11




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 Three Months
    
    
    Nine MonthsEnded
    
    
    EndedAugust 31, 2006
    
    
    August 31, 2006Net income, as reported
    
    $
    378,973
    
    
    $
    1,260,899Add: Stock-based employee
compensation expense included in
reported net income, net of related
tax effects
    
    
    19,699
    
    
    
    60,237Deduct: Total stock-based employee
compensation expense determined under
fair value based method for all
awards, net of related tax effects
    
    
    (64,912
    )
    
    
    (222,098
    )Pro forma net income
    
    $
    333,760
    
    
    $
    1,099,038Earnings per share:Basicas reported
    
    $
    0.12
    
    
    $
    0.40Basicpro forma
    
    $
    0.11
    
    
    $
    0.35Dilutedas reported
    
    $
    0.12
    
    
    $
    0.39Dilutedpro forma
    
    $
    0.10
    
    
    $
    0.34
 Stock Option Grants
     2007
    
    2006Risk-free interest rate
    
    
    4.7
    %
    
    
    4.5
    %Expected term - years
    
    
    6.5
    
    
    
    4.5Expected dividend yield
    
    
    3.2
    %
    
    
    3.3
    %Expected volatility
    
    
    45.8
    %
    
    
    49.4
    %
 12




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
  Weighted-
    
    
    Weighted-Average
    
    
    AverageNumber
    
    
    Exercise
    
    
    Remaining
    
    
    AggregateOptions
    
    of Options
    
    
    Price
    
    
    Contractual Life
    
    
    Intrinsic ValueOptions outstanding
at November 30, 2006
    
    
    306,384
    
    
    $
    7.39Granted
    
    
    125,000
    
    
    $
    8.70Exercised
    
    
    (21,126
    )
    
    $
    4.60
    
    
    
    
    
    
    $
    64,847Forfeited
    
    
    (28,683
    )
    
    $
    9.32Options outstanding
at August 31, 2007
    
    
    381,575
    
    
    $
    7.83
    
    
    
    3.9
    
    
    $
    242,517Options exercisable at
August 31, 2007
    
    
    153,143
    
    
    $
    6.77
    
    
    
    2.3
    
    
    $
    221,648
 Note 7  Costs and Estimated Earnings on Uncompleted Contracts
  August 31,
    
    
    November 30,2007
    
    
    2006Costs incurred on uncompleted contracts
    
    $
    694,252
    
    
    $
    743,480Estimated earnings to date
    
    
    211,495
    
    
    
    361,928Subtotal
    
    
    905,747
    
    
    
    1,105,408Less  Billings to date
    
    
    (1,028,051
    )
    
    
    (1,101,827
    )Total
    
    $
    (122,304
    )
    
    $
    3,581Included in the accompanying balance sheets
under the following caption:Costs and estimated earnings in excess of
billings
    
    $
    
    
    
    $
    52,805Billings in excess of costs and estimated
earnings
    
    
    (122,304
    )
    
    
    (49,224
    )Total
    
    $
    (122,304
    )
    
    $
    3,581
  Note 8  Revolving Line of Credit
  13




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COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
  Note 9  Segment Information
   CIPARFranchisingThree Months Ended
    
    and
    
    CIPARAugust 31, 2007
    
    Licensing
    
    Rehabilitation
    
    CMI
    
    GCI
    
    Corporate
    
    Eliminations
    
    ConsolidatedNet Sales:External customers
    
    $
    2,030,435
    
    
    $
    1,294,757
    
    
    $
    76,670
    
    
    $
    4,934,174
    
    
    $
    
    
    
    $
    
    
    
    $
    8,336,036Intersegment sales
    
    
    99,462
    
    
    
    
    
    
    
    932,154
    
    
    
    
    
    
    
    
    
    
    
    (1,031,616
    )
    
    
    Total net sales
    
    $
    2,129,897
    
    
    $
    1,294,757
    
    
    $
    1,008,824
    
    
    $
    4,934,174
    
    
    $
    
    
    
    $
    (1,031,616
    )
    
    $
    8,336,036Depreciation and
amortization:
    
    
    45,085
    
    
    
    32,536
    
    
    
    10,744
    
    
    
    61,510
    
    
    
    60,717
    
    
    
    
    
    
    
    210,592Net income (loss):
    
    
    86,013
    
    
    
    (55,321
    )
    
    
    126,867
    
    
    
    685,435
    
    
    
    (411,551
    )
    
    
    
    
    
    
    431,443Identifiable assets:
    
    
    10,023,269
    
    
    
    4,088,307
    
    
    
    981,585
    
    
    
    7,896,663
    
    
    
    1,669,927
    
    
    
    
    
    
    
    24,659,751Capital expenditures:
    
    
    30,311
    
    
    
    22,290
    
    
    
    2,012
    
    
    
    26,154
    
    
    
    32,686
    
    
    
    
    
    
    
    113,453
 14




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 CIPARFranchisingThree Months Ended
    
    and
    
    CIPARAugust 31, 2006
    
    Licensing
    
    Rehabilitation
    
    CMI
    
    GCI
    
    Corporate
    
    Eliminations
    
    ConsolidatedNet Sales:External customers
    
    $
    1,541,514
    
    
    $
    884,609
    
    
    $
    66,724
    
    
    $
    3,877,906
    
    
    $
    
    
    
    $
    
    
    
    $
    6,370,753Intersegment sales
    
    
    (31,300
    )
    
    
    
    
    
    
    843,433
    
    
    
    
    
    
    
    
    
    
    
    (812,133
    )
    
    
    Total net sales
    
    $
    1,510,214
    
    
    $
    884,609
    
    
    $
    910,157
    
    
    $
    3,877,906
    
    
    $
    
    
    
    $
    (812,133
    )
    
    $
    6,370,753Depreciation and
amortization:
    
    
    15,669
    
    
    
    19,079
    
    
    
    10,145
    
    
    
    84,097
    
    
    
    1,020
    
    
    
    
    
    
    
    130,010Net income (loss):
    
    
    10,407
    
    
    
    54,079
    
    
    
    89,821
    
    
    
    502,031
    
    
    
    (277,365
    )
    
    
    
    
    
    
    378,973Identifiable assets:
    
    
    8,856,642
    
    
    
    2,654,945
    
    
    
    1,126,406
    
    
    
    7,263,747
    
    
    
    1,487,681
    
    
    
    
    
    
    
    21,389,421Capital expenditures:
    
    
    7,525
    
    
    
    167,947
    
    
    
    5,869
    
    
    
    165,695
    
    
    
    167,061
    
    
    
    
    
    
    
    514,097
 CIPARFranchisingNine Months Ended
    
    and
    
    CIPARAugust 31, 2007
    
    Licensing
    
    Rehabilitation
    
    CMI
    
    GCI
    
    Corporate
    
    Eliminations
    
    ConsolidatedNet Sales:External customers
    
    $
    5,061,924
    
    
    $
    3,068,813
    
    
    $
    220,037
    
    
    $
    13,530,491
    
    
    $
    
    
    
    $
    
    
    
    $
    21,881,265Intersegment sales
    
    
    143,458
    
    
    
    
    
    
    
    2,424,840
    
    
    
    
    
    
    
    
    
    
    
    (2,568,298
    )
    
    
    Total net sales
    
    $
    5,205,382
    
    
    $
    3,068,813
    
    
    $
    2,644,877
    
    
    $
    13,530,491
    
    
    $
    
    
    
    $
    (2,568,298
    )
    
    $
    21,881,265Depreciation and
amortization:
    
    
    126,269
    
    
    
    94,655
    
    
    
    32,544
    
    
    
    179,861
    
    
    
    175,535
    
    
    
    
    
    
    
    608,864Net income (loss):
    
    
    (76,412
    )
    
    
    (313,580
    )
    
    
    328,625
    
    
    
    1,565,491
    
    
    
    (1,047,987
    )
    
    
    
    
    
    
    456,137Identifiable assets:
    
    
    10,023,269
    
    
    
    4,088,307
    
    
    
    981,585
    
    
    
    7,896,663
    
    
    
    1,669,927
    
    
    
    
    
    
    
    24,659,751Capital expenditures:
    
    
    286,520
    
    
    
    160,299
    
    
    
    7,739
    
    
    
    154,908
    
    
    
    199,202
    
    
    
    
    
    
    
    808,668
 CIPARFranchisingNine Months Ended
    
    and
    
    CIPARAugust 31, 2006
    
    Licensing
    
    Rehabilitation
    
    CMI
    
    GCI
    
    Corporate
    
    Eliminations
    
    ConsolidatedNet Sales:External customers
    
    $
    5,111,656
    
    
    $
    3,390,131
    
    
    $
    204,269
    
    
    $
    10,922,694
    
    
    $
    
    
    
    $
    
    
    
    $
    19,628,750Intersegment sales
    
    
    45,883
    
    
    
    
    
    
    
    2,530,464
    
    
    
    
    
    
    
    
    
    
    
    (2,576,347
    )
    
    
    Total net sales
    
    $
    5,157,539
    
    
    $
    3,390,131
    
    
    $
    2,734,733
    
    
    $
    10,922,694
    
    
    $
    
    
    
    $
    (2,576,347
    )
    
    $
    19,628,750Depreciation and
amortization:
    
    
    84,995
    
    
    
    63,233
    
    
    
    23,843
    
    
    
    188,063
    
    
    
    2,475
    
    
    
    
    
    
    
    362,609Net income (loss):
    
    
    233,007
    
    
    
    249,910
    
    
    
    298,670
    
    
    
    1,294,168
    
    
    
    (814,856
    )
    
    
    
    
    
    
    1,260,899Identifiable assets:
    
    
    8,856,642
    
    
    
    2,654,945
    
    
    
    1,126,406
    
    
    
    7,263,747
    
    
    
    1,487,681
    
    
    
    
    
    
    
    21,389,421Capital expenditures:
    
    
    13,532
    
    
    
    184,891
    
    
    
    122,143
    
    
    
    543,435
    
    
    
    396,414
    
    
    
    
    
    
    
    1,260,415
 15




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
  Three Months Ended August 31,2007
    
    2006Equipment and Parts
    
    $
    5,107,435
    
    
    
    61.3
    %
    
    $
    3,931,145
    
    
    
    61.7
    %Coatings
    
    
    1,629,819
    
    
    
    19.6
    
    
    
    1,526,965
    
    
    
    24.0Franchisee & Licensee
    
    
    304,025
    
    
    
    3.6
    
    
    
    28,034
    
    
    
    0.4Rehabilitation
    
    
    1,294,757
    
    
    
    15.5
    
    
    
    884,609
    
    
    
    13.9Total
    
    $
    8,336,036
    
    
    
    100
    %
    
    $
    6,370,753
    
    
    
    100
    %
 Nine Months Ended August 31,2007
    
    2006Equipment and Parts
    
    $
    14,062,032
    
    
    
    64.3
    %
    
    $
    11,568,061
    
    
    
    58.9
    %Coatings
    
    
    4,368,582
    
    
    
    20.0
    
    
    
    4,537,086
    
    
    
    23.1Franchisee & Licensee
    
    
    381,838
    
    
    
    1.7
    
    
    
    133,472
    
    
    
    0.7Rehabilitation
    
    
    3,068,813
    
    
    
    14.0
    
    
    
    3,390,131
    
    
    
    17.3Total
    
    $
    21,881,265
    
    
    
    100
    %
    
    $
    19,628,750
    
    
    
    100
    %
  Nine Months
    
    Nine MonthsThree Months Ended
    
    Three Months Ended
    
    Ended
    
    EndedRegion
    
    August 31, 2007
    
    August 31, 2006
    
    August 31, 2007
    
    August 31, 2006United States
    
    
    57
    
    
    
    57
    
    
    
    56
    
    
    
    57Canada
    
    
    17
    
    
    
    20
    
    
    
    17
    
    
    
    19Asia/Pacific Rim
    
    
    10
    
    
    
    10
    
    
    
    10
    
    
    
    10Europe
    
    
    10
    
    
    
    9
    
    
    
    11
    
    
    
    9Other
    
    
    6
    
    
    
    4
    
    
    
    6
    
    
    
    5Total
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
    
    
    100
    %
 Note 10  Contingencies
  Note 11  New Accounting Standards
  16




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
  Note 12  Dividends
  17




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 
 ITEM 2.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
 Three months ended August 31, 2007 as compared to the same period in the prior year.
       18




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
   Nine months ended August 31, 2007 as compared to the same period in the prior year.
    19




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
       Liquidity and Capital Resources
  20




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
     Critical Accounting Policies and Estimates
    21




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
 Revenue Recognition.
    Accounts receivable.
 Inventories .
 Goodwill.
 22




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
   Forward Looking Statements
  
 ITEM 3. CONTROLS AND PROCEDURES
    23




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 
 PART II
 
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
 a)
    
    The Companys annual meeting of stockholders was held on June 15, 2007.b)
    
    At the annual meeting, the Companys stockholders elected Morton A. Cohen, Michael
L. Boeckman, Richard L. Immerman, Stuart C. McNeill, Terrence R. Ozan, and Morris H.
Wheeler as Directors for a term that expires at the annual meeting of stockholders in
2008.c)
    
    At the annual meeting, the Companys stockholders ratified the appointment of Ernst
& Young LLP as auditors of the Company for fiscal 2007. The holders of 3,047,741 shares
of Common Stock voted to ratify the appointment, the holders of 10,615 shares voted
against the ratification and the holders of 1,964 shares abstained.d)
    
    At the annual meeting, the Companys stockholders ratified the amendment to the
Companys 2005 Long-Term Incentive Plan increasing the number of shares that may be
issued under the Plan by an additional 125,000 shares, to an aggregate of 425,000 shares.
The holders of 1,950,587 shares of Common Stock voted to ratify the amendment, the
holders of 112,988 shares voted against the amendment, and the holders of 4,710 shares
abstained.
 The following tabulation represents voting for the Directors:
 WithheldFor
    
    AuthorityMichael L. Boeckman
    
    
    2,972,458
    
    
    
    87,862Morton A. Cohen
    
    
    3,008,661
    
    
    
    51,659Richard L. Immerman
    
    
    3,011,221
    
    
    
    49,099Stuart C. McNeill
    
    
    2,997,733
    
    
    
    62,587Terrence R. Ozan
    
    
    3,011,221
    
    
    
    49,099Morris H. Wheeler
    
    
    2,996,436
    
    
    
    63,884
 
 ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
 (a)
    
    Exhibit
 31.1
    
    
    302 Certification of Chief Executive Officer31.2
    
    
    302 Certification of Chief Financial Officer32
    
    
    906 Certification of Chief Executive Officer and Chief Financial Officer
 24




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##### Table of Contents



COHESANT TECHNOLOGIES INC.
 (b)
    
    Reports on Form 8-KAn 8-K was filed on June 21, 2007 to report the following; earnings for the second
quarter and six months ended May 31, 2007 (Items 2.02 and 9.01), and an amendment to the
Companys Bylaws to provide that some or all of any or all classes or series of stock of
the Company may be represented by uncertificated shares, and that such uncertificated
            shares may be issued and transferred(Item 5.03).
 25




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##### Table of Contents



SIGNATURES
   COHESANT TECHNOLOGIES INC.BY:
    /s/ Morris H. WheelerMorris H. WheelerPresident & Chief Executive OfficerBY:
    /s/ Robert W. PawlakRobert W. PawlakChief Financial Officer 26