6-K 1 d01-34375.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. FORM 6-K Report of Foreign Issuer Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934 3rd Quarter Financials Eiger Technology, Inc. 330 Bay St. Suite 602 Toronto, ON M5H 2S8 [Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40- F] Form 20-F |X| Form 40-F |_| [Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information by the Commission pursuant to Rule 12g3-2(b) under the Securities Act of 1934.] Yes |X| No |_| 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. Eiger Technology, Inc. Date: August 17,2001 Mr. Gerry A. Racicot President EIGER TECHNOLOGY, INC. | management discussion & analysis Management Discussion & Analysis Eiger Technology, Inc. (Eiger) offers integrated research & development, manufacturing and distribution of computer peripherals and electronic ballasts, as well as, Voice over IP services to the Canadian long distance market. Management's Discussion and Analysis ("MD&A") presents an analysis of the Corporation's financial condition as at June 30, 2001 compared to September 30, 2000 and the results of operations for the nine and three months ended June 30, 2001 compared to corresponding periods of 2000. It should be read in conjunction with the MD&A included in the Corporation's 2000 annual report. Results of Operations Consolidated net operating loss for the nine months ended June 30, 2001 was $2,117,000 versus a net loss of $390,000 for the nine months ended June 30, 2000. Fully diluted operating loss per share was $0.07, up from a loss of $0.02 per share a year ago. Net operating loss for the three months ended June 30, 2001 was $1,052,000 or $0.03 per share fully diluted, compared with a net income of $148,000 or .01 per share fully diluted a year ago. The third quarter loss of $12,952,000 includes an extraordinary loss of $11,900,000, which is a non-cash write down of investment and goodwill that has no impact on our revenue and cash flow. Revenue Consolidated revenue for the three months and nine months ended June 30, 2001 was $7,768,000 and $23,351,000, decreases of 40% and 49% respectively, as compared with $12,970,000 and $46,017,000 for the corresponding periods in the prior year. The drop in revenue was primarily a decrease in revenue at Eiger Net due to a weak computer peripheral marketplace. K-Tronik revenue increased 23% year over year to $7,000,000. Eiger's total revenue increased $1,900,000 over the last quarter ended March 31, 2001. Gross Margin Gross Margin for the three months and nine months ended June 30, 2001 was 6% and 7%, decreases of 3% and 4%, respectively, as compared with 9% and 11% for corresponding periods in the prior year. K-Tronik was able to maintain a 29% gross margin in the face of strong demand for its product while Eiger Net had a minus 5% gross margin for the quarter and ADH obtained a 11% gross margin for the quarter. Expenses Selling, General and Administration expenses for the three months and nine months ended June 30, 2001 were $2,298,000 and $6,762,000 compared to $734,000 and $4,560,000 for the corresponding periods of the previous year. This increase for the quarter and nine months ended June 30, 2001 was due to the non-allocation of head office expenses relating to share issuance and one time expenses of $600,000 from the K-Tronik Asia subsidiary, relating to debt settlement and inventory adjustment charges. EIGER TECHNOLOGY, INC. | management discussion & analysis Financial Position Total assets of the Corporation amounted to $38,649,000 at June 30, 2001 as compared with $57,145,000 at September 30, 2000. This is primarily due to the write-down of the carrying value of certain investments and to a decrease in current assets as business sales volume decreases. Outlook With a solid core of synergistic business units comprised of Onlinetel, Eiger Net and K-Tronik, the Company momentum continues to place it solidly in the Arthur Anderson Tech 100. At the same time that we are confident that the Company will weather and further slowdowns in the economy, we are especially mindful of matching costs and expenses as we move forward and not getting ahead of ourselves in terms of investments and commitments. We expect to keep our leadership and growth potential, so you will see us continuing to invest. Our current interest is potential acquisitions with reliable cash flow and high growth potential in a recession phase of our economy. Eiger Technology, Inc. /s/ G.A. Racicot /s/ K. Attoe, C.A. G.A. RACICOT K. ATTOE, C.A. Chief Executive Officer Chief Financial Officer EIGER TECHNOLOGY, INC. Unaudited Consolidated Financial Statements for the nine months ended June 30, 2001 EIGER TECHNOLOGY, INC. Unaudited Consolidated Balance Sheet
-------------------------------------------------------------------------------- June 30 September 30 2001 2000 -------------------------------------------------------------------------------- $ $ Assets Current Cash and Marketable Securities 8,536,000 8,836,000 Cash Held in Escrow -- 4,978,000 Accounts Receivable 9,103,000 12,039,000 Inventories 7,699,000 10,878,000 Prepaid Expenses 821,000 686,000 ----------- ----------- 26,159,000 37,417,000 Future Income Tax Assets 1,990,000 -- Capital 4,332,000 4,998,000 Long-term Investments 1,693,000 4,337,000 Goodwill 1,211,000 7,640,000 Other 3,264,000 2,753,000 ----------- ----------- 38,649,000 57,145,000 =========== =========== Liabilities and Shareholders' Equity Current Bank Indebtedness 3,210,000 2,670,000 Accounts Payable and Accrued Liabilities 5,673,000 11,184,000 Current Income Taxes Payable (Recoverable) (15,000) 39,000 Current Portion of Long-term Debt 120,000 120,000 ----------- ----------- 8,988,000 14,013,000 ----------- ----------- Long-term Debt 1,134,000 1,488,000 ----------- ----------- Future Income Tax Liabilities 178,000 43,000 ----------- ----------- Non-Controlling Interest 1,833,000 3,253,000 ----------- ----------- Shareholders' Equity Share Capital 41,080,000 38,895,000 Contributed Surplus 217,000 217,000 Retained Earnings (Deficit) (14,781,000) (764,000) ----------- ----------- 26,516,000 38,348,000 ----------- ----------- 38,649,000 57,145,000 =========== ===========
On Behalf of the Board: "Gerry Racicot" Director ------------------------------------------ Gerry Racicot "Keith Attoe" Director ------------------------------------------ Keith Attoe EIGER TECHNOLOGY, INC. Unaudited Consolidated Statement of Operations and Retained Earnings
------------------------------------------------------------------------------------------------------------------------------ For the nine months ended June 30 2001 2000 2001 2000 ------------------------------------------------------------------------------------------------------------------------------ (Current Quarter) (Current Quarter) (Year-to-Date) (Year-to-Date) $ $ $ $ Sales 7,768,000 12,970,000 23,351,000 46,017,000 Cost of Sales 7,311,000 11,765,000 21,629,000 40,935,000 ----------- ----------- ----------- ----------- Gross Margin 457,000 1,205,000 1,722,000 5,082,000 ----------- ----------- ----------- ----------- Expenses Selling, General and Administrative 2,298,000 734,000 6,762,000 4,560,000 Amortization of Capital Assets 80,000 76,000 264,000 228,000 Amortization of Goodwill and Other Assets 300,000 64,000 900,000 198,000 Interest on Long-term Debt 15,000 20,000 51,000 52,000 Other Interest and Bank Charges 104,000 150,000 292,000 404,000 ----------- ----------- ----------- ----------- 2,797,000 1,044,000 8,269,000 5,442,000 ----------- ----------- ----------- ----------- Income (Loss) from Operations (2,340,000) 161,000 (6,547,000) (360,000) Other Income 144,000 364,000 1,187,000 481,000 ----------- ----------- ----------- ----------- Income (Loss) before Taxes (2,196,000) 525,000 (5,360,000) 121,000 Provision for Income Taxes (474,000) 168,000 (1,013,000) 69,000 ----------- ----------- ----------- ----------- Income (Loss) before Non-controlling Interest (1,722,000) 357,000 (4,347,000) 52,000 Non-controlling Interest (670,000) 209,000 (2,230,000) 442,000 ----------- ----------- ----------- ----------- Income (Loss) before Extraordinary Item (1,052,000) 148,000 (2,117,000) (390,000) Extraordinary Item (Net of Future Taxes of $1,000,000): Write down of Investments and Goodwill (11,900,000) -- (11,900,000) -- ----------- ----------- ----------- ----------- Net Income (Loss) for the Period (12,952,000) 148,000 (14,017,000) (390,000) Retained Earnings (Deficit), Beginning of Period (1,829,000) (1,106,000) (764,000) (401,000) Subsidiary Dividends Paid to Non-controlling Interest -- -- -- (409,000) Prior Period Adjustment of Non-controlling Interest -- -- -- 242,000 ----------- ----------- ----------- ----------- Retained Earnings (Deficit), End of Period (14,781,000) (958,000) (14,781,000) (958,000) =========== =========== =========== =========== Earnings Per Share: Income (Loss) before Extraordinary Item: Basic (0.03) 0.01 (0.07) (0.02) =========== =========== =========== =========== Diluted (0.03) 0.01 (0.07) (0.02) =========== =========== =========== =========== Net Income (Loss): Basic (0.38) 0.01 (0.44) (0.02) =========== =========== =========== =========== Diluted (0.38) 0.01 (0.44) (0.02) =========== =========== =========== ===========
EIGER TECHNOLOGY, INC. Unaudited Consolidated Statement of Cash Flows
--------------------------------------------------------------------------------- For the nine months ended June 30 2001 2000 --------------------------------------------------------------------------------- $ $ Cash Flows From: Operating Activities Income (Loss) before Extraordinary Item (2,117,000) (538,000) Items not Involving Cash Amortization 1,164,000 286,000 ----------- ----------- (953,000) (252,000) Changes in Non-cash Operating Accounts Accounts Receivable 2,936,000 (5,493,000) Inventories 3,179,000 (4,400,000) Prepaid Expenses (135,000) 44,000 Accounts Payable (5,511,000) 4,134,000 Current Income Taxes (54,000) (42,000) Future Income Taxes (855,000) (298,000) Non-controlling Interest (1,420,000) 233,000 ----------- ----------- (2,813,000) (6,074,000) ----------- ----------- Investment Activities Purchase of Capital Assets (889,000) (1,441,000) Non-controlling Interest -- 1,611,000 Long-term Investments (3,715,000) -- Goodwill and Other Assets (232,000) (6,096,000) ----------- ----------- (4,836,000) (5,926,000) ----------- ----------- Financing Activities Operating Line of Credit 540,000 5,084,000 Long-term Debt (354,000) 9,000 Contributed Capital -- 570,000 Common Shares Issued 465,000 32,338,000 Costs Related to Issuance of Share Capital 1,720,000 (565,000) ----------- ----------- 2,371,000 37,436,000 ----------- ----------- Net Cash Flows for the Period (5,278,000) 25,436,000 Cash and Cash Equivalents, Beginning of Period 13,814,000 (587,000) ----------- ----------- Cash and Cash Equivalents, End of Period 8,536,000 24,849,000 =========== =========== Cash and Cash Equivalents Represented By: Cash and Marketable Securities 8,536,000 10,182,000 Cash Held in Escrow -- 14,667,000 ----------- ----------- 8,536,000 24,849,000 =========== ===========
EIGER TECHNOLOGY, INC. Notes to the Consolidated Financial Statements For the nine months ended June 30, 2001 -------------------------------------------------------------------------------- Reconciliation to U.S. GAAP: -------------------------------------------------------------------------------- Relevant differences between accounting principles generally accepted in Canada (Cdn. GAAP") compared to those principles generally accepted in the United States of America ("U.S. GAAP") are as follows: U.S. GAAP requires that all organization costs (including those previously deferred) be expensed currently. Also, all product development costs are to be expensed as incurred. Cdn. GAAP permits the deferral and amortization of these costs when certain conditions are met. U.S. GAAP requires the measurement and reporting of "comprehensive income". Comprehensive income includes net income and all other changes to shareholders' equity other than amounts received from or paid to shareholders. The only reportable comprehensive income item for the Company relates to foreign currency translation adjustments as described below. U.S. GAAP requires the use of the current rate method of foreign currency translation, with any resulting foreign exchange translation adjustments forming part of comprehensive income for the year and accumulating as a separate component of shareholders' equity. APB Oinion 25 permits the intrinsic value based method to be used to measure stock option compensation costs. The intrinsic method is generally used in Canada. In this case, the Company grants stock options at fair market value and no compensation is recognized. Reconciliations:
June 30 June 30 2001 2000 ----------- -------- $ $ Net Income - per Cdn. GAAP (14,017,000) (390,000) - expense current product development costs (92,000) (164,000) - expense current organization costs -- (365,000) - add back amortization of deferred costs 220,000 65,000 - adjustments to non-controlling interest and future taxes -- 284,000 - foreign currency translation adjustment 101,000 24,000 ----------- -------- - per U.S. GAAP (13,788,000) (546,000) Comprehensive item - foreign currency translation (101,000) (24,000) ----------- -------- Comprehensive Income (13,889,000) (570,000) =========== ======== Accumulated Other Comprehensive Items - per Cdn. GAAP -- -- - cumulative foreign currency translation adjustments (236,000) (24,000) ----------- -------- - per U.S. GAAP (236,000) (24,000) =========== ========
EIGER TECHNOLOGY, INC. Notes to the Consolidated Financial Statements For the nine months ended June 30, 2001 -------------------------------------------------------------------------------- Reconciliation to U.S. GAAP - continued: --------------------------------------------------------------------------------
June 30 September 30 2001 2000 ----------- ----------- $ $ Retained Earnings (Deficit) - End of Period per Cdn. GAAP (14,781,000) (764,000) - expense deferred product development costs net of portion relating to non-controlling interest (1,042,000) (1,154,000) - expense deferred organization costs net of portion relating to non-controlling interest (138,000) (219,000) - foreign currency translation adjustments 206,000 135,000 - future income tax savings related to above 375,000 447,000 ----------- ----------- - End of Period per U.S. GAAP (15,380,000) (1,555,000) =========== =========== Total Assets - per Cdn. GAAP 38,649,000 57,145,000 - expense deferred product development costs (1,306,000) (1,709,000) - expense deferred organization costs (278,000) (370,000) - increase in future income tax assets 334,000 404,000 ----------- ----------- - per U.S. GAAP 37,399,000 55,470,000 =========== ===========