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CVR Chicago Rivet & Machine

Filed: 7 May 21, 4:02pm
Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 10-Q

 

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2021

OR

 

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 000-01227

 

 

Chicago Rivet & Machine Co.

(Exact Name of Registrant as Specified in Its Charter)

 

 

 

Illinois 36-0904920
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
901 Frontenac Road, Naperville, Illinois 60563
(Address of Principal Executive Offices) (Zip Code)

(630) 357-8500

Registrant’s Telephone Number, Including Area Code

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Stock, par value $1.00 per share CVR NYSE American (Trading privileges only, not registered)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically, every interactive data file required to be submitted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer   Accelerated filer 
Non-accelerated filer   Smaller reporting company 
   Emerging growth company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

As of May 3, 2021, there were 966,132 shares of the registrant’s common stock outstanding.

 

 

 


Table of Contents


Table of Contents

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements.

CHICAGO RIVET & MACHINE CO.

Condensed Consolidated Balance Sheets

March 31, 2021 and December 31, 2020

 

   March 31,
2021
   December 31,
2020
 
   (Unaudited)     

Assets

    

Current Assets:

    

Cash and cash equivalents

  $3,075,766   $2,567,731 

Certificates of deposit

   2,990,000    4,733,000 

Accounts receivable—Less allowances of $170,000

   6,869,891    5,163,450 

Inventories, net

   6,311,960    5,153,294 

Prepaid income taxes

   —      85,940 

Other current assets

   384,811    383,772 
  

 

 

   

 

 

 

Total current assets

   19,632,428    18,087,187 
  

 

 

   

 

 

 

Property, Plant and Equipment:

    

Land and improvements

   1,636,749    1,636,749 

Buildings and improvements

   8,449,768    8,440,738 

Production equipment and other

   36,344,494    36,333,550 
  

 

 

   

 

 

 
   46,431,011    46,411,037 

Less accumulated depreciation

   33,509,910    33,260,153 
  

 

 

   

 

 

 

Net property, plant and equipment

   12,921,101    13,150,884 
  

 

 

   

 

 

 

Total assets

  $32,553,529   $31,238,071 
  

 

 

   

 

 

 

See Notes to the Condensed Consolidated Financial Statements

 

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Table of Contents

CHICAGO RIVET & MACHINE CO.

Condensed Consolidated Balance Sheets

March 31, 2021 and December 31, 2020

 

   March 31,
2021
  December 31,
2020
 
   (Unaudited)    

Liabilities and Shareholders’ Equity

   

Current Liabilities:

   

Accounts payable

  $1,135,304  $466,424 

Accrued wages and salaries

   686,571   482,008 

Other accrued expenses

   317,568   322,968 

Unearned revenue and customer deposits

   205,774   249,498 

Federal and state income taxes

   194,560   —   
  

 

 

  

 

 

 

Total current liabilities

   2,539,777   1,520,898 

Deferred income taxes

   980,084   1,011,084 
  

 

 

  

 

 

 

Total liabilities

   3,519,861   2,531,982 
  

 

 

  

 

 

 

Commitments and contingencies (Note 3)

   

Shareholders’ Equity:

   

Preferred stock, no par value, 500,000 shares authorized: none outstanding

   —     —   

Common stock, $1.00 par value, 4,000,000 shares authorized:

1,138,096 shares issued; 966,132 shares outstanding

   1,138,096   1,138,096 

Additional paid-in capital

   447,134   447,134 

Retained earnings

   31,370,536   31,042,957 

Treasury stock, 171,964 shares at cost

   (3,922,098  (3,922,098
  

 

 

  

 

 

 

Total shareholders’ equity

   29,033,668   28,706,089 
  

 

 

  

 

 

 

Total liabilities and shareholders’ equity

  $32,553,529  $31,238,071 
  

 

 

  

 

 

 

See Notes to the Condensed Consolidated Financial Statements

 

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CHICAGO RIVET & MACHINE CO.

Condensed Consolidated Statements of Income

For the Three Months Ended March 31, 2021 and 2020

(Unaudited)

 

   2021   2020 

Net sales

  $9,304,949   $7,576,455 

Cost of goods sold

   7,270,512    6,266,028 
  

 

 

   

 

 

 

Gross profit

   2,034,437    1,310,427 

Selling and administrative expenses

   1,362,201    1,285,334 
  

 

 

   

 

 

 

Operating profit

   672,236    25,093 

Other income

   17,892    46,475 
  

 

 

   

 

 

 

Income before income taxes

   690,128    71,568 

Provision for income taxes

   150,000    15,000 
  

 

 

   

 

 

 

Net income

  $540,128   $56,568 
  

 

 

   

 

 

 

Per share data, basic and diluted:

    

Net income per share

  $0.56   $0.06 
  

 

 

   

 

 

 

Average common shares outstanding

   966,132    966,132 
  

 

 

   

 

 

 

Cash dividends declared per share

  $0.22   $0.22 
  

 

 

   

 

 

 

See Notes to the Condensed Consolidated Financial Statements

 

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CHICAGO RIVET & MACHINE CO.

Condensed Consolidated Statements of Shareholders’ Equity

For the Three Months Ended March 31, 2021 and 2020

(Unaudited)

 

  Preferred Stock  Common Stock  

Additional

Paid-

  Retained  Less Treasury Stock, at Cost    
 Shares  Amount  Shares  Amount  in Capital  Earnings  Shares  Amount  Total 

Balance, December 31, 2020

  —    $—     966,132  $1,138,096  $447,134  $31,042,957   171,964  $(3,922,098 $28,706,089 

Net Income

      $540,128    $540,128 

Dividends Declared ($0.22 per share)

      $(212,549   $(212,549
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Balance, March 31, 2021

  —    $—     966,132  $1,138,096  $447,134  $31,370,536   171,964  $(3,922,098 $29,033,668 
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Balance, December 31, 2019

  —    $—     966,132  $1,138,096  $447,134  $31,494,895   171,964  $(3,922,098 $29,158,027 

Net Income

      $56,568    $56,568 

Dividends Declared ($0.22 per share)

      $(212,549   $(212,549
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

Balance, March 31, 2020

  —    $—     966,132  $1,138,096  $447,134  $31,338,914   171,964  $(3,922,098 $29,002,046 
 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

See Notes to the Condensed Consolidated Financial Statements

 

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CHICAGO RIVET & MACHINE CO.

Condensed Consolidated Statements of Cash Flows

For the Three Months Ended March 31, 2021 and 2020

(Unaudited)

 

   2021  2020 

Cash flows from operating activities:

   

Net income

  $540,128  $56,568 

Adjustments to reconcile net income to net cash used in operating activities:

   

Depreciation

   330,165   337,356 

Loss on disposal of equipment

   16,081   —   

Deferred income taxes

   (31,000  (24,000

Changes in operating assets and liabilities:

   

Accounts receivable

   (1,706,441  (894,369

Inventories

   (1,158,666  (227,204

Other current assets

   84,901   (225

Accounts payable

   668,880   437,728 

Accrued wages and salaries

   204,563   (15,892

Other accrued expenses

   189,160   (115,663

Unearned revenue and customer deposits

   (43,724  (44,338
  

 

 

  

 

 

 

Net cash used in operating activities

   (905,953  (490,039
  

 

 

  

 

 

 

Cash flows from investing activities:

   

Capital expenditures

   (116,463  (166,667

Proceeds from certificates of deposit

   1,743,000   2,241,000 

Purchases of certificates of deposit

   —     (1,743,000
  

 

 

  

 

 

 

Net cash provided by investing activities

   1,626,537   331,333 
  

 

 

  

 

 

 

Cash flows from financing activities:

   

Cash dividends paid

   (212,549  (212,549
  

 

 

  

 

 

 

Net cash used in financing activities

   (212,549  (212,549
  

 

 

  

 

 

 

Net increase (decrease) in cash and cash equivalents

   508,035   (371,255

Cash and cash equivalents at beginning of period

   2,567,731   1,429,454 
  

 

 

  

 

 

 

Cash and cash equivalents at end of period

  $3,075,766  $1,058,199 
  

 

 

  

 

 

 

Supplemental schedule of non-cash investing activities:

   

Capital expenditures in accounts payable

  $—    $1,330 

See Notes to the Condensed Consolidated Financial Statements

 

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CHICAGO RIVET & MACHINE CO.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. In the opinion of the Company, the accompanying unaudited interim financial statements contain all adjustments necessary to present fairly the financial position of the Company as of March 31, 2021 (unaudited) and December 31, 2020 (audited) and the results of operations and changes in cash flows for the indicated periods. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted from these unaudited financial statements in accordance with applicable rules. Please refer to the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The results of operations for the three month period ended March 31, 2021 are not necessarily indicative of the results to be expected for the year.

2. The Company extends credit on the basis of terms that are customary within our markets to various companies doing business primarily in the automotive industry. The Company has a concentration of credit risk primarily within the automotive industry and in the Midwestern United States.

3. The Company is, from time to time, involved in litigation, including environmental claims and contract disputes, in the normal course of business. While it is not possible at this time to establish the ultimate amount of liability with respect to contingent liabilities, including those related to legal proceedings, management is of the opinion that the aggregate amount of any such liabilities, for which provision has not been made, will not have a material adverse effect on the Company’s financial position.

4. Revenue—The Company operates in the fastener industry and is in the business of manufacturing and selling rivets, cold-formed fasteners and parts, screw machine products, automatic rivet setting machines and parts and tools for such machines. Revenue is recognized when control of the promised goods or services is transferred to our customers, generally upon shipment of goods or completion of services, in an amount that reflects the consideration we expect to receive in exchange for those goods or services. For certain assembly equipment segment transactions, revenue is recognized based on progress toward completion of the performance obligation using a labor-based measure. Labor incurred and specific material costs are compared to milestone payments per sales contract. Based on our experience, this method most accurately reflects the transfer of goods under such contracts. During the first quarter of 2021, the Company realized $235,210 related to such contracts and $120,879 is the remaining performance obligation under such contracts which the Company expects to recognize as revenue in the second quarter.

Sales taxes we may collect concurrent with revenue producing activities are excluded from revenue. Revenue is recognized net of certain sales adjustments to arrive at net sales as reported on the statement of income. These adjustments primarily relate to customer returns and allowances. The Company records a liability and reduction in sales for estimated product returns based upon historical experience. If we determine that our obligation under warranty claims is probable and subject to reasonable determination, an estimate of that liability is recorded as an offset against revenue at that time. As of March 31, 2021 and December 31, 2020 reserves for warranty claims were not material. Cash received by the Company prior to shipment is recorded as unearned revenue.

Shipping and handling fees billed to customers are recognized in net sales, and related costs as cost of sales, when incurred.

Sales commissions are expensed when incurred because the amortization period is less than one year. These costs are recorded within selling and administrative expenses in the statement of income.

 

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The following table presents revenue by segment, further disaggregated by end-market:

 

   Fastener   Assembly
Equipment
   Consolidated 

Three Months Ended March 31, 2021:

      

Automotive

   5,059,469    32,973    5,092,442 

Non-automotive

   3,089,209    1,123,298    4,212,507 
  

 

 

   

 

 

   

 

 

 

Total net sales

   8,148,678    1,156,271    9,304,949 
  

 

 

   

 

 

   

 

 

 

Three Months Ended March 31, 2020:

      

Automotive

   4,413,737    33,459    4,447,196 

Non-automotive

   2,323,660    805,599    3,129,259 
  

 

 

   

 

 

   

 

 

 

Total net sales

   6,737,397    839,058    7,576,455 
  

 

 

   

 

 

   

 

 

 

The following table presents revenue by segment, further disaggregated by location:

 

   Fastener   Assembly
Equipment
   Consolidated 

Three Months Ended March 31, 2021:

      

United States

   6,437,852    1,130,360    7,568,212 

Foreign

   1,710,826    25,911    1,736,737 
  

 

 

   

 

 

   

 

 

 

Total net sales

   8,148,678    1,156,271    9,304,949 
  

 

 

   

 

 

   

 

 

 

Three Months Ended March 31, 2020:

      

United States

   5,740,925    748,486    6,489,411 

Foreign

   996,472    90,572    1,087,044 
  

 

 

   

 

 

   

 

 

 

Total net sales

   6,737,397    839,058    7,576,455 
  

 

 

   

 

 

   

 

 

 

5. The Company’s effective tax rates were approximately 21.7% and 21.0% for the first quarter of 2021 and 2020, respectively.

The Company’s federal income tax returns for the 2017 through 2020 tax years are subject to examination by the Internal Revenue Service (“IRS”). While it may be possible that a reduction could occur with respect to the Company’s unrecognized tax benefits as an outcome of an IRS examination, management does not anticipate any adjustments that would result in a material change to the results of operations or financial condition of the Company. No statutes have been extended on any of the Company’s federal income tax filings. The statute of limitations on the Company’s 2017 through 2020 federal income tax returns will expire on September 15, 2021 through 2024, respectively.

The Company’s state income tax returns for the 2017 through 2020 tax years remain subject to examination by various state authorities with the latest closing period on October 31, 2024. The Company is not currently under examination by any state authority for income tax purposes and no statutes for state income tax filings have been extended.

6. Inventories are stated at the lower of cost or net realizable value, cost being determined by the first-in, first-out method. A summary of inventories is as follows:

 

   March 31, 2021   December 31, 2020 

Raw material

  $  2,734,512   $2,245,709 

Work-in-process

   2,081,169    1,410,868 

Finished goods

   2,095,279    2,096,717 
  

 

 

   

 

 

 

Inventories, gross

   6,910,960    5,753,294 

Valuation reserves

   (599,000   (600,000
  

 

 

   

 

 

 

Inventories, net

  $  6,311,960   $5,153,294 
  

 

 

   

 

 

 

 

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7. Segment Information—The Company operates in two business segments as determined by its products. The fastener segment includes cold-formed parts, rivets and screw machine products. The assembly equipment segment includes automatic rivet setting machines and parts and tools for such machines. Information by segment is as follows:

 

   Fastener   Assembly
Equipment
   Other   Consolidated 

Three Months Ended March 31, 2021:

        

Net sales

  $8,148,678   $1,156,271   $—     $9,304,949 

Depreciation

   291,183    33,533    5,449    330,165 

Segment operating profit

   927,158    296,700    —      1,223,858 

Selling and administrative expenses

   —      —      (543,772   (543,772

Interest income

   —      —      10,042    10,042 
        

 

 

 

Income before income taxes

        $690,128 
        

 

 

 

Capital expenditures

   104,524    —      11,939    116,463 

Segment assets:

        

Accounts receivable, net

   6,222,588    647,303    —      6,869,891 

Inventories, net

   5,055,332    1,256,628    —      6,311,960 

Property, plant and equipment, net

   10,276,980    1,535,329    1,108,792    12,921,101 

Other assets

   —      —      6,450,577    6,450,577 
        

 

 

 
        $32,553,529 
        

 

 

 

Three Months Ended March 31, 2020:

        

Net sales

  $6,737,397   $839,058   $—     $7,576,455 

Depreciation

   296,110    32,869    8,377    337,356 

Segment operating profit

   404,018    184,571    —      588,589 

Selling and administrative expenses

   —      —      (550,896   (550,896

Interest income

   —      —      33,875    33,875 
        

 

 

 

Income before income taxes

        $71,568 
        

 

 

 

Capital expenditures

   167,997    —      —      167,997 

Segment assets:

        

Accounts receivable, net

   5,106,941    396,742    —      5,503,683 

Inventories, net

   4,195,183    983,198    —      5,178,381 

Property, plant and equipment, net

   10,919,327    1,653,895    931,472    13,504,694 

Other assets

   —      —      7,619,802    7,619,802 
        

 

 

 
        $31,806,560 
        

 

 

 

 

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8. COVID-19—In March 2020, the World Health Organization characterized the novel coronavirus (“COVID-19”) a pandemic and the President of the United States declared the COVID-19 outbreak a national emergency. The rapid spread of the virus and the response domestically and internationally to combat it has had a significant negative impact on the global economy, including the automotive industry upon which we rely for sales. Beginning in March 2020, most states issued executive orders which temporarily closed businesses deemed non-essential in an effort to limit the spread of the coronavirus. Similar measures also took place in foreign markets we serve. As a result, our operations and the operations of our customers and suppliers were adversely affected. Since some of our customers are classified as essential businesses and were allowed to continue to operate during this period, we were able to continue our operations, but at a significantly reduced level, in order to service those customers. Our automotive customers were particularly affected, as much of the industry was idled for an extended period of time during the second quarter of 2020 due to employee safety concerns. While most shut-down orders were lifted late in that quarter, various work-related restrictions remained in place and the economic fallout lingers. Due to the rapidly changing business environment and heightened degree of uncertainty resulting from COVID-19, we took measures to reduce expenses and conserve capital during this period, including reduced work schedules, delayed capital expenditures and a reduction in dividend payments. In the second half of 2020, we experienced improved demand as government-imposed restrictions were relaxed. However, the timing and sustainability of any broad economic recovery is uncertain and will likely be tied to the course of the pandemic. As we cannot predict the duration or scope of the COVID-19 pandemic, or its broader impact on the global economy, including the demand for automobiles, it is unknown what the impact of COVID-19 and its related effects will be on our business, results of operations or financial condition, but the impact could be material and last for an extended period of time.

 

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CHICAGO RIVET & MACHINE CO.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Results of Operations

Net sales for the first quarter of 2021 were $9,304,949 compared to $7,576,455 in the first quarter of 2020, an increase of $1,728,494, or 22.8%. The increase was the result of greater demand in both our fastener segment and our assembly equipment segment as the outlook for the global economy improved and the post-pandemic recovery appears to be underway. The increase in sales resulted in net income of $540,128, or $0.56 per share, in the first quarter of this year compared to $56,568, or $0.06 per share, in the first quarter of 2020. Improved operating conditions in the current year allowed for the restoration of the regular quarterly dividend to $0.22 per share after being reduced at the onset of the pandemic in 2020.

Fastener segment revenues were $8,148,678 in the first quarter of 2021 compared to $6,737,397 in the first quarter of 2020, an increase of $1,411,281, or 20.9%. The automotive sector is the primary market for our fastener segment products and sales to automotive customers were $5,059,469 in the first quarter this year compared to $4,413,737 in the first quarter of 2020, an increase of $645,732, or 14.6%. This compares favorably to the first quarter increase in U.S. light-vehicle sales of 11.8%. Fastener segment sales to non-automotive customers were $3,089,209 in the first quarter of this year compared to $2,323,660 in the first quarter of 2020, an increase of $765,549 or 32.9%. The spread of the coronavirus pandemic late in the first quarter of 2020 was the primary factor in the lower sales reported that quarter as nearly all the markets we serve were negatively impacted. The increase in sales in the first quarter of 2021 was the primary factor contributing to the $564,678 increase in fastener segment gross margins to $1,656,629 from $1,091,951 in the first quarter of 2020. While the improvement in gross margins was significant, we have experienced price increases in various manufacturing costs, including steel, our primary raw material, which has increased approximately 11% compared to the first quarter of 2020. Labor costs, which have been held down due to the pandemic, are also expected to increase in the near-term.

Assembly equipment segment revenues were $1,156,271 in the first quarter of 2021 compared to $839,058 in the first quarter of 2020, an increase of $317,213, or 37.8%. The increase in sales in the current year is primarily due to an increase in the number and average selling price of machines sold in the current year as well as improved tool sales. The increase in net sales contributed to a $159,332 increase in segment gross margin from $218,476 in 2020 to $377,808 in 2021.

Selling and administrative expenses during the first quarter of 2021 were $1,362,201 compared to $1,285,334 recorded in the first quarter of 2020, an increase of $76,867, or 6.0%. The increase was primarily due to a $57,000 increase in profit sharing expense related to improved operating profit in the current year quarter and a $15,000 increase in sales commissions due to greater sales in the current year. Selling and administrative expenses were 14.6% and 17.0% of net sales in the first quarter of 2021 and 2020, respectively.

Other Income

Other income in the first quarter of 2021 was $17,892 compared to $46,475 in the first quarter of 2020. The decrease is primarily related to a reduction in interest income on certificates of deposit due to lower interest rates in the current year.

Income Tax Expense

The Company’s effective tax rates were approximately 21.7% and 21.0% for the first quarter of 2021 and 2020, respectively.

Liquidity and Capital Resources

Working capital improved to $17,092,651 as of March 31, 2021 compared to $16,566,289 at the beginning of the year. During the quarter, accounts receivable increased by $1,706,441, due to the greater sales activity during the quarter compared to the fourth quarter of 2020, and inventory increased by $1,158,666 as material purchases were accelerated in advance of higher prices. 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 $116,463, 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

 

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leave cash, cash equivalents and certificates of deposit at $6,065,766 as of March 31, 2021 compared to $7,300,731 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 improved dramatically compared to the first quarter of 2020, when the COVID-19 pandemic and the resultant widespread shut-downs started to push the global economy into recession. While the pandemic is not entirely under control, the wider availability of vaccines has allowed for fewer COVID-related restrictions and an improved economic outlook. We will continue to monitor the impact of the pandemic on all aspects of our operations and act as necessary in the best interests of our employees and the Company. While demand improved in the first quarter, some automobile manufacturers have recently reduced operations due to shortages of critical components. These disruptions could result in reduced demand for our products. We have also experienced higher prices for various commodities compared to last year and longer lead times for certain items. Cost increases can be difficult to recover and further increases are expected. These factors, as well as the 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.

 

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CHICAGO RIVET & MACHINE CO.

Item 4. Controls and Procedures.

(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.

 

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PART II — OTHER INFORMATION

Item 6. Exhibits

 

31  Rule 13a-14(a) or 15d-14(a) Certifications
31.1  Certification Pursuant to Rule 13a-14(a) or 15d-14(a), as Adopted Pursuant to Section  302 of the Sarbanes-Oxley Act of 2002.
31.2  Certification Pursuant to Rule 13a-14(a) or 15d-14(a), as Adopted Pursuant to Section  302 of the Sarbanes-Oxley Act of 2002.
32  Section 1350 Certifications
32.1  Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2  Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101  Interactive Data File. Includes the following financial and related information from Chicago Rivet & Machine Co.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 formatted in Extensible Business Reporting Language (XBRL): (1) Condensed Consolidated Balance Sheets, (2) Condensed Consolidated Statements of Income, (3) Condensed Consolidated Statements of Shareholders’ Equity, (4) Condensed Consolidated Statements of Cash Flows, and (5) Notes to Condensed Consolidated Financial Statements.

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

   CHICAGO RIVET & MACHINE CO.
   (Registrant)
Date: May 7, 2021   
                   /s/ Walter W. Morrissey
   Walter W. Morrissey
   Chairman of the Board of Directors
   and Chief Executive Officer
   (Principal Executive Officer)
Date: May 7, 2021   
   /s/ Michael J. Bourg
   Michael J. Bourg
   President, Chief Operating
   Officer and Treasurer
   (Principal Financial Officer)

 

 

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