-----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, FAG26lfzj1PPcESXAoyW5xT4O4UOTqypWhtAgoeu347+CVGIkq+4w57Y4gbjtXW4 h0Llr1jk/Onpe+Q45XjOaw== /in/edgar/work/20000815/0000910680-00-000577/0000910680-00-000577.txt : 20000922 0000910680-00-000577.hdr.sgml : 20000921 ACCESSION NUMBER: 0000910680-00-000577 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000630 FILED AS OF DATE: 20000814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNITED VENTURES GROUP INC /CO/ CENTRAL INDEX KEY: 0001098332 STANDARD INDUSTRIAL CLASSIFICATION: [3911 ] IRS NUMBER: 841516192 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-28663 FILM NUMBER: 701174 BUSINESS ADDRESS: STREET 1: 131 WEST 35TH STREET CITY: NEW YORK STATE: NY ZIP: 10001 BUSINESS PHONE: 2127360880 MAIL ADDRESS: STREET 1: 131 WEST 35TH STREET CITY: NEW YORK STATE: NY ZIP: 10001 FORMER COMPANY: FORMER CONFORMED NAME: ADVANCED CEILING SUPPLIES INC DATE OF NAME CHANGE: 19991103 10QSB 1 0001.txt FORM 10-QSB OF UNITED VENTURES GROUP, INC. SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-QSB [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2000 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 0-28663 UNITED VENTURES GROUP, INC. (Exact name of small business issuer as specified in its charter) DELAWARE 84-1516192 (State of other jurisdiction of (I.R.S. Employer) incorporation or organization) Identification No.) 131 West 35th Street New York, New York 10001 (Address of principal executive offices) (212) 736-0880 (Issuer's Telephone Number, Including Area Code) Not Applicable (Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report) 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 |_| State the number of shares outstanding of each of the issuer's classes of common equity as of the latest practicable date: Common Stock, $.001 par value per share - 97,590,681 shares outstanding as of June 30, 2000; Series A Preferred Stock, $.001 par value per share - 200 shares outstanding as of June 30, 2000. UNITED VENTURES GROUP, INC. FORM 10-QSB FOR THE QUARTER ENDED June 30, 2000
PART I. FINANCIAL INFORMATION PAGE ---- Item 1. Financial Statements. Consolidated Balance Sheets as of June 30, 2000 and December 31, 1999 F-2 Consolidated Statements of Operations for the Three Months ended June 30, 2000 and June 30, 1999 and the Six Months ended June 30, 2000 and June 30, 1999 F-3 Consolidated Condensed Statements of Cash Flows for the Six Months ended June 30, 2000 and June 30, 1999. F-4 Notes to Financial Statements F-5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. F-6 PART 11. OTHER INFORMATION Item 1. Legal Proceedings. F-7 Item 2. Changes in Securities and Use of Proceeds. F-7 Item 3. Defaults upon Senior Securities. F-7 Item 4. Submission of Matters to a Vote of Security Holders. F-7 Item 5. Other Information. F-7 Item 6. Exhibits and Reports on Form 8-K. F-7
UNITED VENTURES GROUP, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (Unaudited) June 30, 2000
ASSETS ------ At 12/31/99 ---------------- Current assets: Cash $ 6,734 97,465 Accounts receivable, net 4,855,332 3,972,855 Inventory 6,050,000 8,285,730 ----------------- ---------------- Total current assets 10,912,066 12,356,050 Property and equipment, net 426,177 273,303 Other Assets: Deferred financing cost 433,208 551,354 Other 227,750 17,625 ----------------- ---------------- Total assets $ 11,999,201 13,198,332 ================= ================ LIABILITIES AND STOCKHOLDERS' DEFICIT ------------------------------------- Current liabilities: Accounts payable and accrued expenses $ 694,093 1,740,366 Loans payable 2,126,224 4,310,688 Convertible debentures 832,690 1,300,000 Notes payable - financial institution 50,000 6,380,538 ----------------- ---------------- Total current liabilities 3,703,007 13,731,592 ----------------- ---------------- 297,636 Stockholders' equity: Common stock, $.001 par value -100,000,000 shares authorized, 97,140,681 shares issued and outstanding 97,141 24,931 Preferred stock, $.001 par value - 5,000,000 shares authorised, 200,000 Series A shares issued and outstanding 200 200 Additional paid-in capital 18,144,122 10,520,067 Deferred compensation expense (34,169) (136,667) Accumulated deficit (9,911,100) (10,281,849) ----------------- ---------------- Total stockholders' equity 8,296,194 (830,896) ----------------- ---------------- Total liabilities and stockholders' equity $ 11,999,201 13,198,332 ================= ==========
See notes to financial statements F-2 UNITED VENTURES GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
Three Months Ended June 30, Six Months Ended June 30, --------------------------------- ----------------------------------- 2000 1999 2000 1999 --------------- ---------------- ---------------- ----------------- Net sales $ 825,554 $ 1,237,103 $ 5,874,404 $ 3,028,642 Cost of goods sold 364,145 908,035 4,250,782 2,246,148 --------------- ---------------- ---------------- ----------------- Gross profit 461,409 329,068 1,623,622 782,494 Non cash compensation expense 450,000 - 450,000 - Selling, general and administrative 262,678 1,447,191 922,579 2,890,971 Bad debt recovery (700,000) - (700,000) - --------------- ---------------- ---------------- ----------------- Income (loss) from operations 448,731 (1,118,123) 951,043 (2,108,477) Interest expense 289,958 288,313 580,294 1,780,142 Income (loss) before extraordinary items 158,773 (1,406,436) 370,749 (3,888,619) Extraordinary item - loss on early extinguishment of debt, net of taxes - - - (640,402) --------------- ---------------- ---------------- ----------------- Net income $ 158,773 $ (1,406,436) $ 370,749 $ (4,529,021) =============== ================ ================ ================= Basic and diluted net income (loss) per share Before extraodinary item $ 0.00 $ (0.21) $ 0.00 $ (0.59) --------------- ---------------- ---------------- ----------------- Extraordinary item $ 0.00 $ (0.00) $ 0.00 $ (0.10) --------------- ---------------- ---------------- ----------------- Net income (loss) per share $ 0.00 $ (0.21) $ 0.00 $ (0.69) =============== ================ ================ ================= Weighted average common shares outstanding 97,140,681 6,643,326 97,140,681 6,643,326 =============== ================ ================ =================
See notes to financial statements F-3 UNITED VENTURES GROUP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Six months ended June 30, ------------------------- 2000 1999 ------------------------- CASH FLOWS FROM OPERATING ACTIVITIES : Net loss $ 370,749 $ (4,529,021) ------------ ---------------- Adjustment to reconcile net loss to net cash provided by (used in) operating activities: Depreciation 17,500 160,000 Amortization - 50,000 Bad debts - 1,500,000 Officers' compensation 450,000 200,000 Imputed interest on loan from shareholders - 180,000 Interest expense on conversion benefit 27,043 562,000 Amortization of deferred compensation 102,498 - Extinguishment of debt - 640,402 Write-off of deferred financing and offering costs 118,146 59,000 Change in assets and liabilities; Increase in accounts receivable (882,477) (992,067) Decrease in inventories 2,235,730 991,722 Decrease in prepaid expenses - 862 Increase in other assets (210,125) - Decrease (Increase) in accounts payable and accrued expenses (1,046,273) 293,396 ------------ ---------------- Total adjustments 812,042 3,645,315 ------------ ---------------- Net cash provided by (used in) operating activities 1,182,791 (883,706) ------------ ---------------- CASH FLOWS FROM INVESTING ACTIVITIES : Acquisition of property and equipment (170,374) - ------------ ---------------- CASH FLOWS FROM FINANCING ACTIVITIES: Repayment of notes payable - financial instituions (1,884,498) (518,408) Proceeds from convertible debentures 224,450 997,000 Repayment of loans (184,464) 655,344 Increase (decrease) in cash overdraft - (146,065) Stock subscription received - 250,000 Proceeds from issuance of stock 1,039,000 - Repayment to stockholders (297,636) (322,193) ------------ ---------------- Net cash used in (provided by) by financing activities (1,103,148) 915,678 ------------ ---------------- Net decrease (increase) in cash (90,731) 31,972 Cash - beginning of year 97,465 13,028 ------------ ---------------- Cash - end of year $ 6,734 $ 45,000 - SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION : Interest paid $ 27,043 $ 156,308 ============= =============== Taxes paid $ - $ 1,798 ------------ ---------------- NON-CASH FINANICING AND INVESTING ACTIVITIES: Forgiveness of debt by financial institution $ 4,446,040 $ - ============= =============== Conversion of debentures $ 691,760 $ - ============= =============== Forgiveness of notes payable by related party $ 2,000,000 $ - ============= ===============
See notes to consolidated financial statements F-4 UNITED VENTURES GROUP, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. BASIS OF PRESENTATION The accompanying condensed financial statements have been prepared in accordance with generally accounting principles for interim financial information and with instructions to Form 10-QSB. Accordingly, they do not include all of the information and footnotes required by generally accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The results of operations for the three-month and six-month periods ended June 30, 2000 are not necessarily indicative of the results to be expected for the year ended December 31, 2000. The condensed interim financial statements should be read in conjunction with the audited financial statements and notes, contained in the Form 8-K filed on June 15, 2000. 2. ACQUISITION On April 11, 2000, United Ventures Group, Inc. ("UVGI") completed the acquisition of Advanced Ceiling Supplies, Inc. ("ACSI") under an agreement dated as of April 3, 2000. As part of the acquisition, the UVGI acquired 666 shares of ACSI's common stock in exchange for 400,000 shares of the capital stock of UVGI and $110,000 in cash, the balance of $90,000 was paid to cover closing costs. As a result of this transaction, the UVGI received 100% of the outstanding common stock of ACSI. 3. STOCKHOLDERS EQUITY During the six months ended June 30, 2000, the principal shareholders assumed $2,000,000 of the Company's loans payable to unrelated third parties. This transaction was recorded as a capital contribution. F-5 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS - --------------------- SIX-MONTH PERIOD ENDED JUNE 30, 2000 COMPARED TO SIX-MONTH PERIOD ENDED JUNE 30, 1999 Net sales amounted to $5,874,404 for the six-month period ended June 30, 2000, compared to $3,028,642, an increase of $2,845,762 or 94% from the six-month period ended June 30, 1999. The increase of 94% is mainly due to a) the recognition of sales of approximately $2,000,000 that were shipped in 1999 but recognized in year 2000 as per certain GAAP and SEC requirements, and b)the broadening of product line. Gross profit increased by $841,128, or 107% to $1,623,622 for the six-month period ended June 30, 2000 from $782,494 for the six-month period ended June 30, 1999. Gross profit as a percentage of net revenues increase to 27.6% for the six-month period ended June 30, 2000 from 25.8% for the six-month period ended June 30, 1999. The increase in gross profit as a percentage of net revenues is attributable to global sourcing of production, improved production and cost controls. Selling, General and Administrative expenses decreased by $1,968,392, or 68% to $922,579, or 15.7% of net revenues, for the six-month period ended June 30, 2000, from $2,890,971. or 78.6% of net revenues for the six-month period ended June 30, 1999. The principal decrease in expenses were due to a reduction of approximately $1,500,000 in bad debt expenses for the six months ended June 30, 1999 compared to the six-month period ended June 30, 2000. Expenses in 1999 were extraordinarily large due to certain uncollectible sales, which did not recur in 2000. Management was also successful in the recovery of $700,000 of bad debts that were incurred in 1999. Interest expenses decreased to $580,294 for the six-month ended June 30, 2000 from $1,780,142 for the six-month ended June 30, 1999. This decrease is primarily due to substantial reduction of financing debts and the non-recurrence of 1999 expenses of approximately $500,000 related to the beneficial conversion benefits of debentures issued in April 1999 recorded as interest. Liquidity and Capital Resources - ------------------------------- Historically the Company financed operations principally through collections of accounts receivable, loans from financing institutions, issuance of stock and advances from officers. In the six months ended June 30, 2000, the Company financed operations from proceeds from issuance of common stock and from net income from operations. As a result of repayment of all debts to finance institutions, forgiveness of other debts and conversions of outstanding debentures, we believe it will be able to finance future operations from cash generated from operations. Working capital increased from a deficit of $1,300,000 at December 31, 1999 to a positive position of $7,200,000 (an increase of $8,500,000) at June 30, 2000. The increase of working capital was generated by the forgiveness of debt to finance institutions of $4,400,000 (net of cash payment required), forgiveness of debt to third parties of $2,000,000, decrease in inventories of $2,000,000, proceeds from sale of stock of $1,000,000 offset by net reduction of accounts receivable, accounts payables and other expenses of $700,000. On April 5, 2000 a settlement agreement was reached with a finance institution canceling a certain Term Promissory Note in the original principal amount of $2,000,000 from Jarnow to the finance institution; and a certain Term Promissory in the original principal amount of $3,500,000. We made a payment of $1,200,000 to the finance institution in immediately available funds. The finance institution received 4,000,000 restricted common stock shares of the company, subject to certain terms and conditions, more fully explained in the Company's financial statements for the year ended December 31, 1999 (Note 8). As a result of this settlement the Company recognized a net gain from the extinguishment of debt of $4,400,000 recorded as addition to Additional Paid in Capital. F-6 On June 1, 2000, we issued approximately 6,000,000 restricted common shares to certain unrelated parties as a settlement of outstanding debentures to such parties. As a result of this settlement Additional Paid in capital increased by $200,000. At June 30, 2000 debt to third parties of $2,000,000 was forgiven without any consideration. PART II - OTHER INFORMATION Item 1. Legal Proceedings. ----------------- None. Item 2. Changes in Securities and Use of Proceeds. ------------------------------------------ None. Item 3. Defaults Upon Senior Securities. ------------------------------- None. Item 4. Submission of Matters to a Vote of Security Holders. --------------------------------------------------- None. Item 5. Other Information. ----------------- None. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits 27. Financial Data Schedule (b) Reports on Form 8-K On April 10, 2000, the Company filed Current Reports on Form 8-K under Item 1, Changes in Control of Registrant, and Item 6, Resignation of Directors. No Financial Statements were filed with this report. On June 15, 2000, the Company filed Current Reports on Form 8-K under Item 1, Changes in Control of Registrant, Item 2, Acquisition and Disposition of Assets and Item 6, Resignation of Directors. Financial Statement were filed with this report. F-7 SIGNATURES In accordance with the requirements of the Exchange Act, the registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: August 14, 2000 United Ventures Group, Inc. /s/ Isaac Nussen -------------------------- By: Isaac Nussen President and Chief Executive Officer F-8 EXHIBIT INDEX Exhibit Number Description - -------------- ----------- 27 Financial Data Schedule EX-27 2 0002.txt FINANCIAL DATA SCHEDULE
5 1 U.S. DOLLAR 3-MOS DEC-31-2000 APR-01-2000 JUN-30-2000 1 6,734 0 5,994,861 1,139,529 6,050,000 10,212,066 2,461,123 2,034,946 11,999,201 2,870,317 832,690 0 200 97,141 7,998,853 11,799,201 5,874,404 5,874,404 4,250,782 4,250,782 872,579 0 580,294 370,749 0 370,749 0 0 0 370,749 0.00 0.00
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