XNAS:LAWS Lawson Products Inc Quarterly Report 10-Q Filing - 3/31/2012

Effective Date 3/31/2012

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Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

 

 

FORM 10-Q

 

 

(Mark One)

 

x Quarterly Report under Section 13 OR 15(d) of the Securities Exchange Act of 1934

For quarterly period ended March 31, 2012

or

 

¨ Transition Report under Section 13 OR 15(d) of the Securities Exchange Act of 1934

For the transition period from                     to                     

Commission file Number: 0-10546

 

 

LAWSON PRODUCTS, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   36-2229304
(State or other jurisdiction of   (I.R.S. Employer
incorporation or organization)   Identification No.)

1666 East Touhy Avenue,

Des Plaines, Illinois

  60018
(Address of principal executive offices)   (Zip Code)

(847) 827-9666

(Registrant’s telephone number, including area code)

 

 

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  x     No   ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     Yes   x     No   ¨

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

 

Large accelerated filer   ¨    Accelerated filer   x
Non-accelerated filer   ¨  (Do not check if a smaller reporting company)    Smaller reporting company   ¨

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

The number of shares outstanding of the registrant’s common stock, $1 par value, as of April 13, 2012 was 8,574,291.

 

 

 


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“Safe Harbor” Statement under the Securities Litigation Reform Act of 1995:

This Quarterly Report on Form 10-Q contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. The terms “may,” “should,” “could,” “anticipate,” “believe,” “continues,” “estimate,” “expect,” “intend,” “objective,” “plan,” “potential,” “project” and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. These statements are based on management’s current expectations, intentions or beliefs and are subject to a number of factors, assumptions and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Factors that could cause or contribute to such differences or that might otherwise impact the business include:

 

   

the effect of general economic and market conditions;

 

   

inventory obsolescence;

 

   

work stoppages and other disruptions at transportation centers or shipping ports;

 

   

changing customer demand and product mixes;

 

   

increases in commodity prices;

 

   

disruptions of the Company’s information and communication systems;

 

   

the inability of management to successfully implement strategic initiatives;

 

   

failure to manage change;

 

   

failure to retain a talented workforce;

 

   

failure to retain productive sales representatives;

 

   

the influence of controlling stockholders;

 

   

the ability to meet the covenant requirements of our line of credit;

 

   

violations of environmental protection regulations;

 

   

a negative outcome related to employment tax matters; and,

all other factors discussed in the Company’s “Risk Factors” set forth in its Annual Report on Form 10-K for the year ended December 31, 2011.

The Company undertakes no obligation to update any such factors or to publicly announce the results of any revisions to any forward-looking statements contained herein whether as a result of new information, future events or otherwise.

 

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TABLE OF CONTENTS

 

     Page #  

PART I - FINANCIAL INFORMATION

  

Item 1 Financial Statements

  

Condensed Consolidated Balance Sheets as of March 31, 2012 (Unaudited) and December 31, 2011

     4   

Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three Months Ended March 31, 2012 and 2011 (Unaudited)

     5   

Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2012 and 2011 (Unaudited)

     6   

Notes to Condensed Consolidated Financial Statements (Unaudited)

     7   

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

     9   

Item 3 Quantitative and Qualitative Disclosures about Market Risk

     12   

Item 4 Controls and Procedures

     12   

PART II - OTHER INFORMATION

  

Item 6 Exhibits Index

     12   

SIGNATURES

     13   

 

 

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PART I—FINANCIAL INFORMATION

ITEM 1—FINANCIAL STATEMENTS

Lawson Products, Inc.

Condensed Consolidated Balance Sheets

(Dollars in thousands, except per share data)

 

     March 31,     December 31,  
     2012     2011  
     (unaudited)        
ASSETS     

Current assets:

    

Cash and cash equivalents

   $ 1,213      $ 2,116   

Accounts receivable, less allowance for doubtful accounts

     39,915        43,239   

Inventories

     58,795        55,498   

Miscellaneous receivables and prepaid expenses

     7,499        7,064   

Deferred income taxes

     5,716        5,716   

Discontinued operations

     428        410   
  

 

 

   

 

 

 

Total current assets

     113,566        114,043   

Property, plant and equipment, net

     59,498        52,702   

Cash value of life insurance

     14,884        15,490   

Deferred income taxes

     11,864        11,864   

Goodwill

     28,306        28,148   

Other assets

     489        501   
  

 

 

   

 

 

 

Total assets

   $ 228,607      $ 222,748   
  

 

 

   

 

 

 
LIABILITIES AND STOCKHOLDERS’ EQUITY     

Current liabilities:

    

Accounts payable

   $ 18,793      $ 22,967   

Accrued expenses and other liabilities

     25,941        28,231   

Discontinued operations

     496        681   
  

 

 

   

 

 

 

Total current liabilities

     45,230        51,879   
  

 

 

   

 

 

 

Revolving line of credit

     13,350        —     

Security bonus plan

     21,046        23,310   

Deferred compensation

     9,542        9,279   

Construction in progress liability

     7,065        3,377   

Other liabilities

     363        731   
  

 

 

   

 

 

 
     51,366        36,697   
  

 

 

   

 

 

 

Stockholders’ equity:

    

Preferred stock, $1 par value:

    

Authorized—500,000 shares, Issued and outstanding — None

     —          —     

Common stock, $1 par value:

    

35,000,000 shares authorized, 8,580,753 shares issued and

8,574,291 shares outstanding

     8,581        8,581   

Capital in excess of par value

     6,447        6,210   

Retained earnings

     114,546        117,371   

Treasury stock — 6,462 shares

     (130     (130

Accumulated other comprehensive income

     2,567        2,140   
  

 

 

   

 

 

 

Stockholders’ equity

     132,011        134,172   
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 228,607      $ 222,748   
  

 

 

   

 

 

 

See notes to condensed consolidated financial statements.

 

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Lawson Products, Inc.

Condensed Consolidated Statements of Comprehensive Income (Loss)

(Amounts in thousands, except per share data)

(Unaudited)

 

     Three Months Ended March 31,  
     2012     2011  

Net sales

   $ 75,962      $ 82,579   

Cost of goods sold

     34,628        32,640   
  

 

 

   

 

 

 

Gross profit

     41,334        49,939   

Operating expenses

     44,167        46,194   
  

 

 

   

 

 

 

Operating income (loss)

     (2,833     3,745   

Interest expense

     (82     (512

Other income (expense), net

     (7     16   
  

 

 

   

 

 

 

Income (loss) from continuing operations before income taxes

     (2,922     3,249   

Income tax (benefit) expense

     (1,137     1,199   
  

 

 

   

 

 

 

Income (loss) from continuing operations

     (1,785     2,050   

Discontinued operations, net of income taxes

     (13     (30
  

 

 

   

 

 

 

Net income (loss)

   $ (1,798   $ 2,020   
  

 

 

   

 

 

 

Basic income (loss) per share of common stock:

    

Continuing operations

   $ (0.21   $ 0.24   

Discontinued operations

     —          —     
  

 

 

   

 

 

 

Net income (loss)

   $ (0.21   $ 0.24   
  

 

 

   

 

 

 

Diluted income (loss) per share of common stock:

    

Continuing operations

   $ (0.21   $ 0.24   

Discontinued operations

     —          (0.01
  

 

 

   

 

 

 

Net income (loss)

   $ (0.21   $ 0.23   
  

 

 

   

 

 

 

Cash dividends declared per share of common stock

   $ 0.12      $ 0.12   
  

 

 

   

 

 

 

Basic weighted average shares outstanding:

     8,574        8,531   

Dilutive effect of stock based compensation

     —          74   
  

 

 

   

 

 

 

Diluted weighted average share outstanding

     8,574        8,605   
  

 

 

   

 

 

 

Net comprehensive income (loss)

   $ (1,371   $ 2,394   
  

 

 

   

 

 

 

See notes to condensed consolidated financial statements.

 

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Lawson Products, Inc.

Condensed Consolidated Statements of Cash Flows

(Dollars in thousands)

(Unaudited)

 

     Three Months Ended March 31,  
     2012     2011  

Operating activities:

    

Net income (loss)

   $ (1,798   $ 2,020   

Loss from discontinued operations

     13        30   
  

 

 

   

 

 

 

Income (loss) from continuing operations

     (1,785     2,050   

Adjustments to reconcile to net cash used in operating activities:

    

Depreciation and amortization

     1,735        1,334   

Deferred income taxes

     —          898   

Stock based compensation

     198        227   

Changes in operating assets and liabilities:

    

Accounts receivable

     3,286        (3,335

Inventories

     (3,184     (4,026

Prepaid expenses and other assets

     (84     (385

Accounts payable and accrued expenses

     (6,173     (3,110

Other

     (2,844     (510
  

 

 

   

 

 

 

Net cash used in operating activities of continuing operations

   $ (8,851   $ (6,857
  

 

 

   

 

 

 

Investing activities:

    

Additions to property, plant and equipment

   $ (4,440   $ (4,301

Net proceeds (outlay) from sale of businesses

     250        (692
  

 

 

   

 

 

 

Net cash used in investing activities of continuing operations

   $ (4,190   $ (4,993
  

 

 

   

 

 

 

Financing activities:

    

Net proceeds from revolving line of credit

   $ 13,350      $ —     

Dividends paid

     (1,027     (1,023
  

 

 

   

 

 

 

Net cash provided by (used in) financing activities of continuing operations

   $ 12,323      $ (1,023
  

 

 

   

 

 

 

Net cash used in operating activities of discontinued operations

   $ (185   $ (451
  

 

 

   

 

 

 

Increase (decrease) in cash and cash equivalents

     (903     (13,324

Cash and cash equivalents at beginning of period

     2,116        40,566   
  

 

 

   

 

 

 

Cash and cash equivalents at end of period

   $ 1,213      $ 27,242   
  

 

 

   

 

 

 

See notes to condensed consolidated financial statements.

 

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NOTES TO FINANCIAL STATEMENTS

Note 1 — Basis of Presentation and Summary of Significant Accounting Policies

The accompanying unaudited condensed consolidated financial statements of Lawson Products, Inc. (the “Company”) have been prepared in accordance with generally accepted accounting principles for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not contain all disclosures required by generally accepted accounting principles. Reference should be made to the Company’s Annual Report on Form 10-K for the year ended December 31, 2011. In the opinion of the Company, all normal recurring adjustments have been made, that are necessary to present fairly the results of operations for the interim periods. Operating results for the three-month period ended March 31, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012.

Certain reclassifications have been made to prior period amounts to conform to current period presentation. Such reclassifications have no effect on net income as previously reported. The Company has adopted Accounting Standards Update (“ASU”) No. 2011-05 and 2011-12 regarding the presentation of comprehensive income in the financial statements. In the first three months of 2012, the effect of restricted share awards and future stock option exercises equivalent to 39 thousand shares would have been anti-dilutive and therefore, were excluded from the computation of diluted earnings per share.

There have been no material changes in our significant accounting policies during the three months ended March 31, 2012 as compared to the significant accounting policies described in our Annual Report on Form 10-K for the year ended December 31, 2011. The Company has determined that there were no subsequent events to recognize or disclose in these financial statements.

Note 2 — Inventories

Components of inventories were as follows:

 

     (Amounts in thousands)  
     March 31,
2012
    December 31,
2011
 

Finished goods

   $ 61,051      $ 56,985   

Work in progress

     1,850        1,935   

Raw materials

     1,536        1,624   
  

 

 

   

 

 

 

Total

     64,437        60,544   

Reserve for obsolete and excess inventory

     (5,642     (5,046
  

 

 

   

 

 

 
   $ 58,795      $ 55,498   
  

 

 

   

 

 

 

Note 3 — Severance Reserve

The table below shows the changes in the Company’s reserve for severance and related payments, included in accrued expenses and other liabilities on the Condensed Consolidated Balance Sheets as of March 31, 2012 and 2011:

 

     (Amounts in thousands)  
     Three Months Ended March 31,  
     2012     2011  

Balance at beginning of year

   $ 1,282      $ 3,062   

Charged to earnings

     185        745   

Cash paid

     (584     (1,111
  

 

 

   

 

 

 

Balance at end of the period

   $ 883      $ 2,696   
  

 

 

   

 

 

 

Note 4 — Income Tax

The Company and its subsidiaries are subject to U.S. Federal income tax as well as income tax of multiple state and foreign jurisdictions. As of March 31, 2012, the Company is subject to U.S. Federal income tax examinations for the years 2009 and 2010, and income tax examinations from various other jurisdictions for the years 2006 through 2010.

 

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Earnings from the Company’s foreign subsidiaries are considered to be indefinitely reinvested. A distribution of these non-U.S. earnings in the form of dividends or otherwise would subject the Company to both U.S. Federal and state income taxes, as adjusted for tax credits and foreign withholding taxes.

Note 5 — Segment Reporting

The Company has two reportable operating segments: MRO and OEM. The Company’s MRO segment is a distributor of products and services to the industrial, commercial, institutional, and governmental maintenance, repair and operations marketplace. The Company’s OEM segment manufactures, sells and distributes production and specialized component parts to the original equipment marketplace. The Company’s two reportable segments are distinguished by the nature of products distributed and sold, types of customers and manner of servicing them. The Company evaluates performance and allocates resources to reportable segments primarily based on operating income.

The following table presents summary financial information for the Company’s reportable segments:

 

     (Amounts in thousands)  
     Three Months Ended March 31,  
     2012     2011  

Net sales

    

MRO

   $ 71,364      $ 79,255   

OEM

     4,598        3,324   
  

 

 

   

 

 

 

Consolidated total

   $ 75,962      $ 82,579   
  

 

 

   

 

 

 

Operating income (loss)

    

MRO

   $ (3,424   $ 3,600   

OEM

     591        145   
  

 

 

   

 

 

 

Consolidated total

     (2,833     3,745   

Interest expense

     (82     (512

Other income (expense), net

     (7     16   
  

 

 

   

 

 

 

Income (loss) from continuing operations before income taxes

   $ (2,922   $ 3,249   
  

 

 

   

 

 

 

Note 6 — Contingent Liability

One of the Company’s subsidiaries, Drummond American LLC (“Drummond”), is under an employment tax examination for the years 2007 and 2008 of the long-standing treatment of its sales representatives as independent contractors. In January 2012 the Company received a Notice of Proposed Adjustment in the amount of $9.5 million, including penalties, from the IRS challenging Drummond’s position that the sales representatives were independent contractors. Although the Company intends to vigorously defend its position for the treatment of its sales representatives as independent contractors, the Company established a liability of $1.2 million during 2011 as its best estimate of the cost to resolve this matter. An unfavorable outcome of this matter could have a material adverse effect on the Company’s business, financial condition and results of operations.

Note 7 — Non-Cash Items

During the three months ended March 31, 2012, the Company recorded a $4.0 million increase in construction in progress, which is part of Property, plant and equipment, along with a corresponding increase in liabilities, related to the build-to-suit lease of the McCook, Illinois distribution center. These non-cash increases have been excluded from the Condensed Consolidated Statements of Cash Flows.

 

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Quarter ended March 31, 2012 compared to Quarter ended March 31, 2011

The following table presents a summary of our financial performance for the three months ended March 31, 2012 and 2011:

 

     2012     2011  
($ in thousands)    Amount     % of
Net Sales
    Amount     % of
Net Sales
 

Net sales

        

MRO

   $ 71,364        93.9   $ 79,255        96.0

OEM

     4,598        6.1        3,324        4.0   
  

 

 

   

 

 

   

 

 

   

 

 

 

Consolidated total

   $ 75,962        100.0   $ 82,579        100.0
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

        

MRO

   $ 40,297        56.5   $ 49,280        62.2

OEM

     1,037        22.6        659        19.8   
  

 

 

     

 

 

   

Consolidated total

     41,334        54.4        49,939        60.5   
  

 

 

     

 

 

   

Operating expenses

        

Selling expenses

     20,134        26.5        22,152        26.8   

General and administrative expenses

     24,033        31.6        24,042        29.2   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total

     44,167        58.1        46,194        56.0   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss)

     (2,833     (3.7     3,745        4.5   

Other expense, net

     (89     (0.1     (496     (0.6
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) from continuing operations before income tax expense

     (2,922     (3.8     3,249        3.9   

Income tax (benefit) expense

     (1,137     (1.5     1,199        1.4   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) from continuing operations

   $ (1,785     (2.3 )%    $ 2,050        2.5
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Sales

Net sales for the first quarter of 2012 decreased 8.0% to $76.0 million, from $82.6 million in the first quarter of 2011. Excluding the Canadian exchange rate impact, net sales decreased 7.8% for the quarter.

MRO net sales decreased 10.0% in the first quarter of 2012, to $71.4 million from $79.3 million in the prior year period. MRO average daily sales decreased to $1.115 million in the first quarter of 2012 compared to $1.258 million in the first quarter of 2011. The decrease was mainly driven by a sales decline of $4.4 million within the government segment primarily within bases that support troop deployment, lower freight revenues and an increase in small customer account attrition. The declines were partially offset by one additional selling day and a modest increase within the strategic segment. MRO average daily sales decreased 3.1% from the fourth quarter of 2011, primarily due to lower government sales and an increase in small customer attrition.

OEM net sales increased 38.3% in the first quarter of 2012, to $4.6 million from $3.3 million in the prior year period, driven by stronger demand from existing customers.

 

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Gross Profit

Gross profit decreased $8.6 million in the first quarter of 2012, to $41.3 million from $49.9 million in the prior year period. MRO gross profit as a percent of net MRO sales decreased to 56.5% in the first quarter of 2012, compared to 62.2% achieved in the first quarter of 2011, primarily due to lower outbound freight recoveries, an increase in our inventory reserves, additional labor to support our customers, a negative margin impact from the increased attrition of higher margin small customers and a shift toward higher volume national customers with lower margins. National accounts represented approximately 11.4% of MRO sales for the quarter versus approximately 9.8% in the prior year quarter.

OEM gross profit increased $0.4 million and increased as a percent of OEM sales to 22.6% in the first quarter of 2012 from 19.8% in the first quarter of 2011. The improvement as a percent of sales was primarily driven by leverage gained from a higher sales volume.

Selling Expenses

Selling expenses consist of commissions paid to our independent sales representatives, employee sales expenses and related expenses to support our sales efforts. Selling expenses decreased to $20.1 million in the first quarter of 2012 from $22.2 million in the prior year quarter, primarily due to lower sales. Selling expenses decreased as a percent of sales to 26.5% in 2012 from 26.8% in 2011.

General and Administrative Expenses

General and administrative expenses consist of expenses to operate our distribution network and overhead expenses to manage the business. General and administrative expenses were $24.0 million for the first quarters of both 2012 and 2011. The $1.9 million of ERP implementation expenses incurred in 2011 was offset in 2012 by increased expenses to work through post ERP go-live issues and an increase in depreciation expense.

Other Expense, net

Other expense, net consists primarily of interest expense. Interest expense of $0.1 million in the first quarter of 2012 primarily relates to interest charged on the outstanding borrowings of our revolving line of credit. Interest expense of $0.5 million in the first quarter of 2011 primarily relates to interest assessed on unclaimed property settlements.

Income Tax (Benefit) Expense

An income tax benefit of $1.1 million was generated in the three months ended March 31, 2012 on a pre-tax loss of $2.9 million, resulting in an effective tax rate of 38.9%. For the three months ended March 31, 2011, income tax expense was $1.2 million on pre-tax income of $3.2 million, resulting in an effective tax rate of 36.9%. The increase in the effective tax rate was primarily due to the effect of permanent tax differences on forecasted annual 2012 results compared to 2011.

Income (Loss) from Continuing Operations

We reported a loss from continuing operations of $1.8 million or $0.21 per diluted share in the first quarter of 2012 compared to income from continuing operations of $2.1 million or $0.24 per diluted share in the first quarter of 2011.

 

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Liquidity and Capital Resources

Cash and cash equivalents were $1.2 million on March 31, 2012 compared to $2.1 million on December 31, 2011.

Net cash used in continuing operations was $8.9 million for the first three months of 2012 primarily to support increases in working capital. Accounts receivable decreased $3.3 million compared to December 31, 2011 due to lower sales levels and the collection of past due amounts as a result of our ERP implementation. Inventories increased $3.2 million primarily to support anticipated demand for specific sales initiatives and to expand lines for our strategic customers. Accounts payable and accrued expenses decreased $6.2 million during the quarter due to the timing of vendor payments and payments made for employee compensation earned in 2011. Similarly, the $6.9 million of net cash used in continuing operations in the first three months of 2011 primarily supported increases in working capital.

Capital expenditures were $4.4 million for the first three months of 2012 compared to $4.3 million for the first three months of 2011. Expenditures in the first three months were primarily for our web-site redevelopment, the build out of our new leased headquarters, and warehouse equipment to support the opening of the leased McCook, Illinois distribution center. Capital expenditures in the first three months of 2011 included $3.2 million related to the ERP implementation.

Net cash provided by financing activities in the first quarter 2012 included borrowings of $13.4 million primarily to support working capital and capital expenditure investments. We paid $1.0 million in shareholder dividends in both the first three months of 2012 and 2011.

Our $55.0 million revolving line of credit includes an unused $20.0 million accordion feature. On March 31, 2012, we had $13.4 million of borrowings and $1.8 million of outstanding letters of credit, leaving borrowing availability of $39.8 million compared to $53.2 million on December 31, 2011.

At March 31, 2012 we were in compliance with all covenants related to our revolving line of credit as detailed below:

 

Covenant

   Minimum
Requirement
  Actual

Minimum EBITDA (loss), as defined in the amended credit agreement

   $(2.5) million   $(0.6) million

Minimum cash plus accounts receivable and inventory to debt ratio

   1.75:1.00   6.59:1.00

Minimum tangible net worth

   $55.0 million   $78.1 million

The minimum required EBITDA level increases to $2.0 million and $3.0 million for the quarters ended June 30, 2012 and September 30, 2012, respectively. Failure by the Company to meet the covenant requirements of our credit agreement could lead to higher financing costs, increased restrictions or reduce or eliminate our ability to borrow funds. We are developing plans and exploring options to ensure that our financing arrangements and cash provided by operations are sufficient to fund our operating requirements, strategic initiatives and capital improvements throughout 2012.

 

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Table of Contents

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes in market risk at March 31, 2012 from that reported in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

ITEM 4. CONTROLS AND PROCEDURES

Under the supervision and with the participation of our senior management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as 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 (the “Evaluation Date”). Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded as of the Evaluation Date that our disclosure controls and procedures were effective such that (i) the information relating to Lawson, including our consolidated subsidiaries, required to be disclosed in our SEC reports is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) include, without limitation, controls and procedures designed to ensure that information required to be disclosed is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

There was no change in the Company’s internal control over financial reporting during the quarter ended March 31, 2012 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II

OTHER INFORMATION

ITEMS 1, 1A, 2, 3, 4 and 5 of Part II are inapplicable and have been omitted from this report.

ITEM 6. EXHIBITS

 

Exhibit #

    
31.1    Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2    Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32    Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
*101.INS    XBRL Instance Document
*101.SCH    XBRL Taxonomy Extension Schema Document
*101.CAL    XBRL Taxonomy Extension Calculation Linkbase Document
*101.LAB    XBRL Taxonomy Extension Label Linkbase Document
*101.PRE    XBRL Taxonomy Extension Presentation Linkbase Document

* Furnished but not filed.

 

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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.

 

   

LAWSON PRODUCTS, INC.

(Registrant)

Dated April 26, 2012       /s/ Thomas J. Neri
      Thomas J. Neri
     

President and Chief Executive Officer

(principal executive officer)

     
Dated April 26, 2012       /s/ Ronald J. Knutson
      Ronald J. Knutson
     

Senior Vice President and Chief Financial Officer

(principal financial and accounting officer)

 

 

13

XNAS:LAWS Lawson Products Inc Quarterly Report 10-Q Filling

Lawson Products Inc XNAS:LAWS Stock - Get Quarterly Report SEC Filing of Lawson Products Inc XNAS:LAWS stocks, including company profile, shares outstanding, strategy, business segments, operations, officers, consolidated financial statements, financial notes and ownership information.

XNAS:LAWS Lawson Products Inc Quarterly Report 10-Q Filing - 3/31/2012
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