##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 
 FORM 10-Q
  þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended April 3, 2010
 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: 001-33507
 EDAC Technologies Corporation
  Wisconsin
    
    39-1515599(State or other jurisdiction of 
incorporation or organization)
    
    (I.R.S. employer
Identification No.)
 1806 New Britain Avenue, Farmington, CT 06032
   (Registrants telephone number, including area code)
 þ o
 o o
  Large accelerated filer o   
    Accelerated filer o
    Non-accelerated filer o
    Smaller reporting company þ(Do not check if a smaller reporting company)
  o þ




---



TABLE OF CONTENTS  PART I FINANCIAL INFORMATIONITEM 1 FINANCIAL STATEMENTSITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKITEM 4. CONTROLS AND PROCEDURESPART II  OTHER INFORMATIONITEM 6. EXHIBITSSIGNATURESEXHIBIT INDEXEX-31.1EX-31.2EX-32.1    Table of Contents  
  
  
 April 3,
    
    
    January 2,2010
    
    
    2010(in thousands)
    
    (Unaudited)
    
    
    (Audited)ASSETSCURRENT ASSETS:Cash
    
    $
    766
    
    
    $
    1,100Accounts receivable (net of allowance for
for doubtful accounts of $280 as of
April 3, 2010 and $249 as of
January 2, 2010)
    
    
    12,543
    
    
    
    10,862Inventories, net
    
    
    20,196
    
    
    
    19,990Prepaid expenses and other current
assets
    
    
    556
    
    
    
    306Refundable income taxes
    
    
    112
    
    
    
    112Deferred income taxes
    
    
    1,098
    
    
    
    1,098Total current assets
    
    
    35,271
    
    
    
    33,468PROPERTY, PLANT AND EQUIPMENT, at cost
    
    
    49,175
    
    
    
    48,431Less: accumulated depreciation
    
    
    26,623
    
    
    
    25,97422,552
    
    
    
    22,457OTHER ASSETS
    
    
    190
    
    
    
    202TOTAL ASSETS
    
    $
    58,013
    
    
    $
    56,127
  2




---



##### Table of Contents



April 3,
    
    
    January 2,2010
    
    
    2010(in thousands)
    
    (Unaudited)
    
    
    (Audited)LIABILITIES AND SHAREHOLDERS EQUITYCURRENT LIABILITIES:Lines of credit
    
    $
    3,491
    
    
    $
    1,591Current portion of long-term debt
    
    
    1,773
    
    
    
    1,833Trade accounts payable
    
    
    6,405
    
    
    
    6,828Employee compensation and amounts
withheld
    
    
    1,596
    
    
    
    1,185Accrued expenses
    
    
    2,020
    
    
    
    1,819Customer advances
    
    
    702
    
    
    
    1,028Total current liabilities
    
    
    15,988
    
    
    
    14,284LONG-TERM DEBT, less current portion
    
    
    11,744
    
    
    
    12,154PENSION LIABILITIES
    
    
    1,521
    
    
    
    1,448DEFERRED INCOME TAXES
    
    
    4,557
    
    
    
    4,475SHAREHOLDERS EQUITY:Common stock, par value $.0025 per
share; issued and outstanding :4,844,469 on April 3, 2010 and
4,840,803 on January 2, 2010
    
    
    12
    
    
    
    12Additional paid-in capital
    
    
    11,342
    
    
    
    11,225Retained earnings
    
    
    15,145
    
    
    
    14,78526,499
    
    
    
    26,022Less: accumulated other comprehensive loss
    
    
    2,296
    
    
    
    2,256Total shareholders equity
    
    
    24,203
    
    
    
    23,766TOTAL LIABILITIES AND
SHAREHOLDERS EQUITY
    
    $
    58,013
    
    
    $
    56,127
  3




---



##### Table of Contents



For the three months endedApril 3,
    
    
    April 4,(in thousands except per share amounts)
    
    2010
    
    
    2009Sales
    
    $
    17,787
    
    
    $
    9,584Cost of Sales
    
    
    15,646
    
    
    
    8,503Gross Profit
    
    
    2,141
    
    
    
    1,080Selling, General and Administrative Expenses
    
    
    1,730
    
    
    
    861Income from Operations
    
    
    410
    
    
    
    219Non-Operating Income (Expense):Interest Expense
    
    
    (226
    )
    
    
    (140
    )Other
    
    
    360
    
    
    
    7Income before Provision For Income Taxes
    
    
    544
    
    
    
    86Provision for Income Taxes
    
    
    184
    
    
    
    30Net Income
    
    $
    360
    
    
    $
    56Income per share data (Note A):Basic Income Per Common Share
    
    $
    0.07
    
    
    $
    0.01Diluted Income Per Common Share
    
    $
    0.07
    
    
    $
    0.01
  4




---



##### Table of Contents



For the three months endedApril 3,
    
    
    April 4,(in thousands)
    
    2010
    
    
    2009Operating Activities:Net income
    
    $
    360
    
    
    $
    56Adjustments to reconcile net income
to net cash provided by (used in) operating activities:Depreciation and amortization
    
    
    661
    
    
    
    366Deferred income taxes
    
    
    82
    
    
    
    10Gain on acquisition of business
    
    
    (350
    )
    
    
    Gain on sale of property, plant and equipment
    
    
    
    
    
    
    (5
    )Compensation expense pursuant to stock options
    
    
    108
    
    
    
    55Provision for doubtful accounts receivable
    
    
    31
    
    
    
    Changes in working capital items
    
    
    (2,271
    )
    
    
    (450
    )Net cash provided by (used in)
operating activities
    
    
    (1,379
    )
    
    
    32Investing Activities:Additions to property, plant and equipment
    
    
    (394
    )
    
    
    (101
    )Equipment deposits
    
    
    
    
    
    
    (774
    )Proceeds from sales of property, plant and equipment
    
    
    
    
    
    
    6Net cash used in investing activities
    
    
    (394
    )
    
    
    (869
    )Financing Activities:Increase in lines of credit
    
    
    1,900
    
    
    
    773Repayments of long-term debt
    
    
    (470
    )
    
    
    (590
    )Proceeds from exercise of stock options
    
    
    9
    
    
    
    Net cash provided by financing activities
    
    
    1,439
    
    
    
    183Decrease in cash
    
    
    (334
    )
    
    
    (654
    )Cash at beginning of period
    
    
    1,100
    
    
    
    1,311Cash at end of period
    
    $
    766
    
    
    $
    658Supplemental Disclosure of
Cash Flow Information:Interest paid
    
    $
    226
    
    
    $
    140Income taxes paid (refunded)
    
    
    39
    
    
    
    (511
    )
  5




---



##### Table of Contents



ACQUISITION
   For the Three Months EndedApril 4, 2009Sales
    
    $
    15,411Net income
    
    $
    150Basic income per share
    
    $
    0.03Diluted income per share
    
    $
    0.03
 BASIS OF PRESENTATION
   6




---



##### Table of Contents



April 3, 2010
    
    
    January 2, 2010Raw materials
    
    $
    2,453
    
    
    $
    2,519Work-in-progress
    
    
    16,172
    
    
    
    15,891Finished goods
    
    
    2,226
    
    
    
    2,23520,851
    
    
    
    20,645Less: reserve for
excess and obsolete
    
    
    (655
    )
    
    
    (655
    )Inventories, net
    
    $
    20,196
    
    
    $
    19,990
  April 3,
    
    April 4,2010
    
    2009Basic:Weighted average common shares outstanding
    
    
    4,842
    
    
    
    4,825Diluted:Dilutive effect of stock options
    
    
    116
    
    
    
    36Weighted average shares diluted
    
    
    4,958
    
    
    
    4,861Options excluded since antidilutive
    
    
    575
    
    
    
    425
  Sales of Financial Assets
 Consolidation of Variable Interest
Entities
 7




---



##### Table of Contents



April 3, 2010
    
    
    January 2, 2010Lines of credit
    
    $
    3,491
    
    
    $
    1,591Term notes
    
    
    8,049
    
    
    
    8,420Mortgage loans
    
    
    5,422
    
    
    
    5,475Capital lease obligations
    
    
    46
    
    
    
    9217,008
    
    
    
    15,578Less  equipment line of credit
    
    
    1,391
    
    
    
    1,391Less  revolving line of credit
    
    
    2,100
    
    
    
    200Less  current portion of long-term debt
    
    
    1,773
    
    
    
    1,833$
    11,744
    
    
    $
    12,154
 8




---



##### Table of Contents



For the quarter endedApril 3,
    
    
    April 4,2010
    
    
    2009Components of net periodic benefit cost:Interest cost
    
    $
    79
    
    
    $
    82Expected return on plan assets
    
    
    (71
    )
    
    
    (62
    )Amortization of acturial loss
    
    
    30
    
    
    
    33Net periodic pension expense
    
    $
    38
    
    
    $
    53
    9




---



##### Table of Contents



For the quarter endedApril 3,
    
    
    April 4,2010
    
    
    2009Current provision
    
    $
    82
    
    
    $
    20Deferred
    
    
    102
    
    
    
    10Total provision
    
    $
    184
    
    
    $
    30
  
 ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
 Sales.
  For the quarter endedApril 3,
    
    
    April 4,Product Line
    
    2010
    
    
    2009
    
    
    ChangeEDAC Aero
    
    $
    12,554
    
    
    $
    5,186
    
    
    $
    7,368Apex Machine Tool
    
    
    3,987
    
    
    
    3,851
    
    
    
    136Gros-Ite Spindles
    
    
    1,246
    
    
    
    547
    
    
    
    699Total
    
    $
    17,787
    
    
    $
    9,584
    
    
    $
    8,203
   10




---



##### Table of Contents



For the quarter endedApril 3,
    
    
    April 4,2010
    
    
    2009Aerospace customers
    
    $
    13,597
    
    
    $
    6,948Other
    
    
    4,190
    
    
    
    2,636Total
    
    $
    17,787
    
    
    $
    9,584
  Cost of Sales.
 Selling, General & Administrative Expenses.
 11




---



##### Table of Contents



Interest Expense.
 Other Income.
 Income Taxes.
 Liquidity and Capital Resources.
  Three Months EndedApril 3,
    
    April 4,2010
    
    2009Net cash flows (used in) provided by
operating activities:
    
    
    ($1,379
    )
    
    $
    32
   Three Months EndedApril 3,
    
    April 4,2010
    
    2009Net cash flows used in
investing activities:
    
    $
    394
    
    
    $
    869
  12




---



##### Table of Contents



Three Months EndedApril 3,
    
    April 4,2010
    
    2009Net cash flows provided by
financing activities:
    
    $
    1,439
    
    
    $
    183
    CRITICAL ACCOUNTING POLICIES AND ESTIMATES
   13




---



##### Table of Contents



14




---



##### Table of Contents



ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  
 ITEM 4. CONTROLS AND PROCEDURES
 Evaluation of disclosure and procedures
  Changes in internal control over financial reporting
  
  
 ITEM 6. EXHIBITS
 3.1*
    
    EDACs Amended and Restated Articles of Incorporation3.2*
    
    Articles of Amendment to EDACs Amended and Restated Articles of Incorporation.3.3*
    
    EDACs Amended and Restated By-laws .31.1
    
    Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the
Securities Exchange Act of 1934, as amended.31.2
    
    Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the
Securities Exchange Act of 1934, as amended.32.1
    
    Certification of Chief Executive Officer and Chief Financial Officer pursuant to
Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended.
 
 *
    
    Incorporated by reference 15




---



##### Table of Contents



EDAC TECHNOLOGIES CORPORATIONApril 30, 2010
    By

/s/
Glenn L. PurpleGlenn L. Purple, Chief FinancialOfficer and duly authorized officer 16




---



##### Table of Contents



NUMBER
    
    DESCRIPTION3.1
    
    EDACs Amended and Restated Articles of Incorporation (1)3.2
    
    Articles of Amendment to EDACs Amended and Restated Articles of Incorporation. (2)3.3
    
    EDACs Amended and Restated By-laws (3)31.1*
    
    Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the
Securities Exchange Act of 1934, as amended.31.2*
    
    Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the
Securities Exchange Act of 1934, as amended.32.1*
    
    Certification of Chief Executive Officer and Chief Financial Officer pursuant to
Rule 13a-14(b) under the Securities Exchange Act of 1934, as amended.
 
 (1)
    
    Exhibit incorporated by reference to the Companys registration
statement on Form S-1 dated August 6, 1985, commission file
No. 2-99491, Amendment No.1.(2)
    
    Exhibit incorporated by reference to the Companys Report
on Form 10-Q dated July 30, 2008.(3)
    
    Exhibit incorporated by reference to the Companys Report
on Form 8-K dated February 19, 2002.*
    
    Filed herewith. 17