-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OeH4lcomWAnj9fdJGeo5GoV/ilkRKU813bmTq1LYj9XXA+hpM9t4viv5ViSm2QCP 2BOak1OEJ6/Yg+AtEp7seA== /in/edgar/work/20000911/0001039962-00-000005/0001039962-00-000005.txt : 20000922 0001039962-00-000005.hdr.sgml : 20000922 ACCESSION NUMBER: 0001039962-00-000005 CONFORMED SUBMISSION TYPE: 10QSB CONFIRMING COPY: PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20000630 FILED AS OF DATE: 20000911 FILER: COMPANY DATA: COMPANY CONFORMED NAME: IMMECOR CORP CENTRAL INDEX KEY: 0001039962 STANDARD INDUSTRIAL CLASSIFICATION: [3571 ] IRS NUMBER: 680324628 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 333-06966 FILM NUMBER: 00000000 BUSINESS ADDRESS: STREET 1: 100-105 PROFESSIONAL CENTER DR CITY: ROHNERT PARK STATE: CA ZIP: 94928-2137 BUSINESS PHONE: 7075853036 MAIL ADDRESS: STREET 1: 100-105 PROFESSIONAL DR CITY: ROHNERT PARK STATE: CA ZIP: 94928 10QSB 1 0001.txt ANNUAL REPORT UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2000 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from __________ to: _________ Commission File Number: 333-06966 IMMECOR CORPORATION (Name of small business issuer in its charter) California 68-0324628 (State or jurisdiction of incorporation or (I.R.S. Employer Identification No.) Organization) 100 Professional Center Drive, Rohnert Park, California 94928-2137 (Address of principal executive offices) (707) 585-3036 (Issuer's Telephone Number) Securities registered under Section 12(b) ofthe Exchange Act: None Securities registered under Section 12(g) ofthe Exchange Act: Common Stock, Without Par Value Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 [ ] (APPLICABLE ONLY TO CORPORATE ISSUERS) State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date. 5,806,128 shares of common stock as of June 30, 2000. Transitional Small Business Disclosure Format Yes [ ] No [X] -1- IMMECOR CORPORATION INDEX TABLE OF CONTENTS PART I FINANCIAL INFORMATION Item 1. Balance sheets at December 31, 1999 and June 30, 2000 Statements of income for the six months ended June 30, 1999 and 2000 Statements of cash flows for the six months ended June 30, 1999 and 2000 Item 2. Management's Discussion and Analysis or Plan of Operation PART II OTHER INFORMATION Item 1. Legal proceedings Item 2. Changes in securities Item 3. Defaults upon senior securities Item 4. Submission of matters to a vote of security holders Item 5 Other information Item 6. Exhibits and Reports on Form 8-K FORWARD LOOKING STATEMENTS Immecor Corporation (the "Company") cautions readers that certain important factors may affect the Company's actual results and could cause such results to differ materially from any forward-looking statements that may be deemed to have been made in this Form 10-QSB or that are otherwise made by or on behalf of the Company. For this purpose, any statement contained in the Form 10-QSB that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as "may", "expect", "believe", "anticipate", "intend", "could", "estimate", or "continue" or the negative other variations thereof or comparable terminology are intended to identify forward-looking statements. Factors that may affect the Company's results include, but are not limited to, the Company's limited history of profitability, its dependence on a limited number of customers and key personnel, its possible need for additional financing and its dependence on certain industries. The Company is also subject to other risks detailed herein or detailed from time to time in the Company's filings with the Securities and Exchange Commission. PART I ITEM 1. FINANCIAL INFORMATION Page The following Financial Statements are filed as part of this report: Balance Sheets 3 Statements of Income 4 Statements of Cash Flows 5 Notes to Financial Statements 6 IMMECOR CORPORATION Balance Sheets ASSETS
December 31, June 30, 1999 2000 ----- ----- (unaudited) Current Assets Cash $ 57,788 $ 684,661 Accounts receivables (Note 2) (net of allowance for doubtful amounts of $18,749 in 1999 and $19,500 in 2000 ) 989,972 2,511,643 Inventories (Note 3) 1,159,638 1,426,966 Notes receivable - 24,250 Prepaid and other assets (Note 7) 59,476 67,206 Deferred tax assets 13,681 64,728 Total current assets 2,280,555 4,779,454 ---------- --------- EQUIPMENT AND IMPROVEMENTS -net (Note 4) 125,601 169,425 ------- ------- Total Assets $ 2,406,156 $ 4,948,879 ------------ ---------- LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Line of credit (Note 6) $ 350,890 $ 127,115 Notes payable, due within one year (Note 5) 5,318 3,147 Accounts payable 1,380,692 1,678,873 Accrued liabilities (Note 10) 165,214 1,600,000 Advances from shareholders - 93,389 Other liabilities - (10,618) Sales tax payable - 19,595 Income tax payable - 812,349 ---------- ----------- Total current liabilities 1,902,114 4,323,850 Long-term Liabilities Note payable, due after one year (Note 5) 3,189 3,820 Deferred income taxes 16,536 (23,558) --------- ------------ Total long-term liabilities 19,725 (19,738) -------- ------------ Total liabilities 1,921,839 4,304,112 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY Preferred stock, no par value, 20,000,000 shares authorized; no shares issued and outstanding Common stock, no par value, 50,000,000 shares authorized; issued and outstanding, 1999: 2,435,376; 2000: 5,806,128 288,855 288,856 Retained earnings 195,462 355,911 -------- ------------ Total shareholders' equity 484,317 644,767 ------- ------------ Total liabilities and shareholders' equity $ 2,406,156 $ 4,948,879 --------- ------------ The accompanying notes are an integral part of these financial statements -3- IMMECOR CORPORATION Statement of Income Period ended June 30, (unaudited) 1999 2000 ----- ----- (restated) (unaudited) Net sales (Note 8) $ 4,280,288 $ 12,286,060 Cost of sales 3,614,632 10,151,826 ----------- ------------- Gross profit 665,656 2,134,233 Selling, general and administrative expenses 576,148 1,198,563 --------- ------------- Operating income 89,498 935,670 Interest income 202 1,392 Inventory writeoff (44,835) Other income 1,102 22,081 Interest expense (6,962) (32,651) -------- -------------- Income before income taxes 97,764 881,657 Income taxes (Note 9) 58,611 721,208 -------- ------------- NET INCOME $ 39,153 $ 160,449 Net income per share - basic and diluted (Note 11) $ 0.016 $ 0.028 Weighted average shares outstanding - basic and diluted 2,435,376 5,806,128 The accompanying notes are an integral part of these financial statements -4- IMMECOR CORPORATION Statement of Cash Flow Period ended June 30, 1999 2000 ------ ------ (restated) (unaudited) Increase (decrease) from cash Cash flows from operating activities: Net income $ 39,153 $ 161,315 Adjustments to reconcile net income to net cash (used in) provided by operating activities: Depreciation 4,170 4,170 Deferred taxes (1,054) (91,141) Change in assets and liabilities: Accounts and notes receivable (329,441) (1,545,921) Inventory (416,488) (191,943) Prepaids and others (15,057) 7,730 Accounts payable 766,979 221,931 Accrued liabilities (5,465) 1,443,763 --------- -------------- Income taxes payable (47,876) 812,349 Net cash (used in) provided by operating activities (47,348) 822,253 Cash flows from Investing activities: Purchase of fixed assets (87,479) (47,994) Notes receivable issued (140,801) 0 ---------- ------------ Net cash (used in) provided by investing activities (228,280) (47,994) Cash flows from financing activities Repayment of Line of Credit 483,439 (223,775) Proceeds from notes payable 0 1,540 Payments on note payable 0 0 Advances from shareholders (643) 93,389 ---------- --------- Net cash (used in) provided by financing activities 483,960 (128,846) Net increase (decrease) in cash (169,733) 626,873 Cash beginning of period 207,040 57,788 ----------- ------------ Cash at end of period $37,307 $684,661 ----------- ------------ Supplemental disclosure of cash flow information Cash paid during period for: Interest $ 653 $32,593 Income taxes $86,500 $57,348
The accompanying notes are an integral part of these financial statements 5 IMMECOR CORPORATION NOTES TO THE INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS Note 1: Summary of Significant Accounting Policies Basis of Presentation The financial statements included in this Form 10-QSB have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted, pursuant to such rules and regulations, although management believes the disclosures are adequate to make the information presented not misleading. The results of operations for any interim period are not necessarily indicative of results for a full year. These statements should be read in conjunction with the financial statements and related notes included in the Company's Annual Report on Form 10-KSB for the year ended December 31, 1999. The financial statements presented herein as of June 30, 1999 and for the six months ended June 30, 2000 reflect, in the opinion of management, all material adjustments consisting only of normal recurring adjustments necessary for a fair presentation of the financial position, results of operations and cash flow for the interim periods. Earnings per share amounts are based on the weighted average number of common stock shares outstanding in each period. Note 2: Receivables Receivables consist of the following as of June 30:
1999 2000 ----- ------ Accounts receivable $ 1,008,721 $ 2,531,143 Less allowance for doubtful accounts 18,749 19,500 ----------- ------------ $ 989,972 $ 2,511,643 Note 3: Inventory Inventories consist of the following as of June 30: 1999 2000 ----- ------ Purchased parts $ 800,150 $ 946,106 Finished systems 359,488 405,474 ---------- ------------ $ 1,159,638 $ 1,351,581 Note 4: Equipment and Improvements Equipment and improvements consist of the following as of June 30: 1999 2000 ----- ------ Equipment and Furniture $ 126,001 $ 122,421 Transportation equipment 68,649 68,649 -------- ------------ 194,650 191,070 Less accumulated depreciation 69049 21,645 -------- ------------ $ 125,601 $ 169,425
-6- IMMECOR CORPORATION NOTES TO THE INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS Note 5: Note Payable Note payable consists of the following as of June 30: 1999 2000 -------- ----- Note payable, collaterized by vehicle, payable in monthly installments of $443 including interest of 10.5% through September 2001 $ 8,505 $ 6,967 Less amount due in one year 5,316 3,147 --------- -------- $ 3,189 $ 3,820 Note 6: Line of Credit The Company has a $1,500,000 line of credit which expires December 20, 2000. Advances under the line of credit can not exceed 80% of eligible accounts receivable and is secured by a security interest in all accounts receivable, inventory and equipment. The line of credit is also personally guaranteed by the Company's major shareholder. The advance outstanding on the line of credit as of June 30, 2000 was $127,115 Note 7: Commitments The Company leases two premises under a noncancelable operating leases. Operating lease one expires in January 2001, and operating lease two expires in April 2002. The Company is obligated to pay its pro-rate share of utilities for the building on a monthly basis. For lease two the Company is obligated to pay its own utilities and has set up an account with the local utility company. Minimum future rental payments under the lease agreements for the periods ended June 30 are as follows: Lease One Lease Two City of Rohnert Park City of Santa Clara 2000 $ 29,418 $ 24,796 2001 0 51,600 2002 0 51,600 --------------- ----------- $ 29,418 $ 127,996 Note 8: Sales to Major Customers A material part of the Company's business is dependent upon sales to major customers, the loss of which would have a material adverse effect on the Company's financial position and results of operation. One customer, who designated the Company "Strategic Supplier" in 1999, accounted for 72% and 83% of total sales in 1999 and 2000 respectively. The Company is attempting to expand its sales force to increase the customer base to lessen the effect of having major corporate customers. Note 9: Income Taxes The provision for income taxes consists of the following for the first six months June 30, 2000: 2000 Currently payable: Federal $ 721,208 State 19,595 Deferred taxes 64,728 ------------------- $ 805,531 IMMECOR CORPORATION NOTES TO THE INTERIM UNAUDITED CONDENSED FINANCIAL STATEMENTS Note 10: Accrued Liabilities Due to recent shortages for components used in the the Company's products destined for the semiconductor industry, the Company entered a procurement agreement as follows: components from various manufacturers are delivered to the Company's warehouse in quantities matching the Company's book of orders. Upon inspection, testing and certification, the accepted components are used in production. The accrued liability shown on the Company's interim balance sheet is currently an estimate of the value of components received before acceptance, actual billing and production. Accepted components are payable within 120 days of billing date without discount. The Company estimates these accrued liabilities to be paid during the third quarter period, which ends September 30, 2000. Note 11: Number of Shares of Common Stock Outstanding Note 11 adjusts the number of outstanding shares of common stock for the six months ended June 30, 1999 to reflect the following: 1) The Company filed a lawsuit against three shareholders who were formerly officers and directors of the Company seeking rescission of the issuance of 500,000 shares of common stock in the acquisition of Advanced Network Communications, Inc., in 1994. The litigation was settled effective August 31, 1999, resulting in the return of 500,000 shares of common stock to the Treasury of the Company, reducing the number of outstanding shares of Common Stock from 2,435,376 to 1,935,376. 2) On October 13, 1999, the Company held a special meeting of stockholders in which they voted for the approval of a three for one forward split of the outstanding shares of common stock of the Company. The Board of Directors approved the split and requested the stock transfer agent of the Company to distribute the additional shares to the Company's stockholders effective May 1, 2000. 3) Number of shares outstanding June 30, 1999: 2,435,376 Number of shares outstanding August 31, 1999: 1,935,376 Number of shares outstanding June 30, 2000: 5,806,128 -8- Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. Financial Condition and Results of Operations: The following table sets forth, as a percentage of sales, certain items included in the Company's financial statements. Six months Ended June 30, Statements of Income Data: -1999- -2000- Net sales 100.00% 100.00% Cost of sales .................................. 82.8 82.0 Gross profit ..................................... 17.2 17.0 Depreciation and amortization .................... .9 - Selling, general and administrative expenses ..... 9.06 9.0 Total operating costs and expenses ............... 4.53 9.0 Operating income (loss) .......................... 3.62 7.0 Interest income (loss) ........................... .01 - Interest expense.................................. .16 - Income (loss) before income taxes................. 3.6 7.0 Income Tax ...................................... 2.71 5.0 Net income (loss) ................................ .94 1.0 Net Sales Net sales increased by $8,005,772 or 187% from $4,280,288 for the six months ended June 30, 1999 (the "1999 period") to $12,286,060 for the six months ended June 30, 2000 ("the 2000 period"). The significant increase in sales during the first six months of 2000 is primarily due to an increase in the demand for the Company's main product and the introduction of two new computer system products used in yield management applications for the semiconductor industry. Corporate systems, which include servers, processors, and industrial managers continue to remain the primary component of unit sales. The Company's primary customer designated Immecor Corporation it's strategic supplier for computer hardware and system integration services. Sales of hardware increased 358% during the first six months system integration services sales increased 35% during the same period. Gross Profit As a percentage of net sales, gross profits increased from $665,656 in the 1999 period to $2,135,233 in the 2000 period. The Company continues to invest in development of new products, restructuring production facilities to support its continued goal of improving and developing efficient procurement, manufacturing and distribution processes, while developing and introducing new products. The Company expects to continue to increase its research, development and engineering spending for the next two quarters of 2000. Selling, General and Administrative Expenses Selling, general and administrative expenses increased $622,415 or 108% from $576,148 in the 1999 period to $1,198,563 in the 2000 period. The increase in expenses was due primarily to the increased staffing and increased infrastructure expenses, including information systems such as MRP (Material Resource Planning) and ERP (Enterprise Resource Planning) to support the Company's growth pattern. The Company believes that its ability to manage operating expenses is an important factor in its ability to remain competitive and successful. The Company will continue to invest in personnel, information systems and other infrastructure, as well as in research, development and engineering activities to support its continued growth and to continue to develop new competitive products and more efficient methods receiving payments from customers through EDI( electronic data interchange ). Liquidity and Capital Resources On June 30, 1999 and June 30, 2000 the Company had net working capital of $378,441 and $458,059 respectively. The $79,180 increase in working capital from 1999 to 2000 was primarily due to an increase in accounts receivables and cash in the operating account. The company had net cash provided by operating activities of $(47,348) in the 1999 period compared to net cash provided by operating activities of $822,253 in the 2000 period. The $774,905 difference relates primarily to an increase in accounts receivables due to acclerated growth in sales and cash management. The Company had net cash used by financing activities of $483,960 in the 1999 period compared to net cash used by financing activities of $(128,846) in the 2000 period. The difference relates primarily to financing of new products and higher inventory levels for the new products. -9- PART II. OTHER INFORMATION Item 1. Legal Proceedings During this period the Company was sued in Small Claims Court of Sonoma County in the State of California, Case No. 156522, for the amount of Two Hundred and Fifty ($250.00) dollars. On 5/18/00 the case was continued at the plaintiff's request, so the file could be transferred to Superior Court. The trial is scheduled for 8/14/2000. The Company considers the suit as having no merit. Item 2. Changes in Securities There were no changes in rights of securities holders. Item 3. Defaults upon Senior Securities There were no defaults upon senior securities. Item 4. Submission of Matters to a Vote of Security-Holders There were no matters submitted to the vote of securities holders. Item 5. Other Information There were no major contracts signed during the period. Item 6. Exhibits and Reports on Form 8-K There were no reports filed on Form 8-K during this period. SIGNATURES In accordance with the requirements of the Securities and Exchange Commission the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. IMMECOR CORPRATION Date: August 15, 2000 By: /s/ Wil. L. Lindgren ----------------------- Wil L. Lindgren Chief Financial Officer Date: August 15, 2000 By: /s/ Heinot H. Hintereder Chief Executive Officer ----------------------- -10- LEGEND IMMECOR CORPORATION MULTIPLIER 1 CURRENCY 1
PERIOD-TYPE YEAR YEAR FISCAL-YEAR-END DEC-31-1999 DEC-31-2000 PERIOD-START JAN-1-1999 JAN-1-2000 PERIOD-END JUN-30-1999 JUN-30-2000 EXCHANGE-RATE 1 1 CASH 37307 684661 SECURITIES 0 0 RECEIVABLES 1105427 2531146 ALLOWANCES 18749 19500 INVENTORY 677540 1426966 CURRENT-ASSETS 2004350 4779454 PP&E 156023 169425 DEPRECIATION 40145 21645 TOTAL-ASSETS 2133073 4948879 CURRENT-LIABILITIES 1438531 4323850 BONDS 0 0 PREFERRED-MANDATORY 0 0 PREFERRED 0 0 COMMON 286573 288856 OTHER-SE 385732 355911 TOTAL-LIABILITY-AND-EQUITY 2133073 4948879 SALES 4280288 12286060 TOTAL-REVENUES 4280288 12286060 CGS 3542070 10151826 TOTAL-COSTS 4118218 11350389 OTHER-EXPENSES 0 0 LOSS-PROVISION 0 0 INTEREST-EXPENSE 6962 32651 INCOME-PRETAX 155310 881657 INCOME-TAX 116157 721208 INCOME-CONTINUING 39153 160449 DISCONTINUED 0 0 EXTRAORDINARY 0 0 CHANGES 0 0 NET-INCOME 39153 160449 EPS-PRIMARY .016 .028 EPS-DILUTED .016 .028
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