-----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, OQlKXKS5png3ytPYqJNcKwJwYTG0QGMq7IQNUcEs4zvWOCgEf1NmGInCvLrxu+Ek rRYPYOF4deOvKC3IPtAAaQ== 0000312006-97-000001.txt : 19971126 0000312006-97-000001.hdr.sgml : 19971126 ACCESSION NUMBER: 0000312006-97-000001 CONFORMED SUBMISSION TYPE: 10QSB/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19970930 FILED AS OF DATE: 19971125 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DENCOR ENERGY COST CONTROLS INC CENTRAL INDEX KEY: 0000312066 STANDARD INDUSTRIAL CLASSIFICATION: AUTO CONTROLS FOR REGULATING RESIDENTIAL & COMML ENVIRONMENT [3822] IRS NUMBER: 840658020 STATE OF INCORPORATION: CO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB/A SEC ACT: SEC FILE NUMBER: 000-09255 FILM NUMBER: 97727834 BUSINESS ADDRESS: STREET 1: 1450 WEST EVANS CITY: DENVER STATE: CO ZIP: 80223 BUSINESS PHONE: 3039221888 MAIL ADDRESS: STREET 2: 1450 W EVANS CITY: DENVER STATE: CO ZIP: 80223 10QSB/A 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB/A (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 1997 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 0-9255 DENCOR ENERGY COST CONTROLS, INC. (Exact name of small business issuer specified in its charter) Colorado 84-0658020 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) 1450 West Evans, Denver, Colorado 80223 (Address of principal executive office) (Zip Code) (303) 922-1888 (Registrant's telephone number, including area code) 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. No par value per share: 3,671,304 shares outstanding at Sept. 30, 1997. Transitional Small Business Disclosure Format Yes No X DENCOR ENERGY COST CONTROLS, INC. PART 1 - FINANCIAL INFORMATION Item 1. Financial Statements (Condensed Balance Sheets) ASSETS September 30 December 31 1997 1996 (unaudited) CURRENT ASSETS: Cash $ 5,600 $ 1,600 Accounts Receivable,net of allowance for doubtful accounts of $9,200 55,300 58,500 Inventories 132,100 143,600 Other 24,500 8,300 TOTAL CURRENT ASSETS 217,500 212,000 Furniture & Equipment 213,300 213,300 Less Accumulated Depreciation (213,300) (211,300) -0- 2,000 Other Receivables, net of allowance for doubtful receivables of $2,300 3,300 3,400 $220,800 $217,400 LIABILITIES & STOCKHOLDERS' DEFICIT CURRENT LIABILITIES: Notes Payable - Shareholders $ 99,400 $ 93,400 Accounts Payable 43,800 33,300 Accrued Compensation and Benefits 33,000 30,600 Accrued Interest - Shareholders 66,400 53,600 Deposits 9,900 Warranty Reserve 6,300 6,300 Other 1,600 1,600 TOTAL CURRENT LIABILITIES 250,500 228,700 STOCKHOLDERS' DEFICIT Common Stock, no par value, authorized 5,000,000 shares; issued & outstanding, 3,671,304 shares 1,147,600 1,147,600 Accumulated Deficit (1,177,300) (1,158,900) Stockholders' Deficit (29,700) (11,300) $ 220,800 $ 217,400 See notes to condensed financial statements DENCOR ENERGY COST CONTROLS, INC. STATEMENTS OF OPERATIONS (unaudited) Three Months Nine Months Ended September 30 Ended September 30 1997 1996 1997 1996 REVENUES: Net Sales $ 92,300 $ 100,000 $ 360,000 $ 299,900 Interest and Other 1,700 2,300 5,200 6,200 TOTAL REVENUES 94,000 102,300 365,200 306,100 COSTS AND EXPENSES; Cost of Products Sold 43,600 50,000 173,500 161,100 Selling 7,900 7,000 18,700 16,200 General and Administrative 37,200 30,700 106,800 86,700 Research and Development 30,100 15,800 69,400 50,600 Interest 5,500 4,700 15,200 13,900 124,300 108,200 383,600 328,500 NET LOSS $(30,300) $ (5,900) $(18,400) $( 22,400) NET LOSS PER COMMON SHARE: Net loss $ (.0083) $ (.0017) $ (.0051) $ (.0062) WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 3,671,304 3,671,304 3,671,304 3,671,304 See notes to condensed financial statements DENCOR ENERGY COST CONTROLS, INC. STATEMENT OF CASH FLOWS (unaudited) Nine Months Ended September 30 1997 1996 CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings $ (18,400) $(22,400) Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 2,000 3,000 Changes in operating assets and liabilities: Accounts and other receivables 3,300 11,200 Inventories 11,500 19,100 Other assets (16,200) (6,700) Notes Payable 6,000 Accounts payable 10,500 (11,400) Accrued compensation and benefits 2,400 (1,700) Accrued interest - shareholders 12,800 13,600 Deposits (9,900) Other liabilities (2,700) Total adjustments 22,400 24,400 Net cash provided by operating 4,000 2,000 activities CASH, beginning of year 1,600 3,800 CASH, end of quarter 5,600 5,800 Supplemental disclosure of cash flow information: Cash paid during the nine month period for interest $ -0- $ 400 See notes to condensed financial statements DENCOR ENERGY COST CONTROLS, INC. NOTES TO CONDENSED FINANCIAL STATEMENTS A. The condensed Financial Statements included herein 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 the Company believes that the disclosures are adequate to make the information presented not misleading. In the opinion of the Company, all accompanying unaudited condensed Financial Statements contain all adjustments, which consist only of recurring adjustments, necessary to present fairly the financial position as of September 30, 1997, and the results of operations and cash flows for the nine months ended September 30, 1997 and 1996. The results of operations for the three-month and nine-month periods ended September 30, 1997 and 1996, are not necessarily indicative of the results to be expected for the full year. It is suggested that these Condensed Financial Statements be read in conjunction with the Financial Statements and the notes therein included in the Company's latest annual reporton Form 10-KSB. B. Long-Term Debt: As of the end of Third Quarter, 1997, the Company had no long-term debt. C. Common Stock: During the Third Quarter, 1997, the Company sold no stock. D. Letter of Intent: In May 1997, the Company entered into a letter of intent to merge with Proven Alternatives, Inc. (PAI). PAI is an integrated energy and process management firm. It provides process knowledge, energy management capabilities, energy efficiency technologies and capital capabilities to solve business problems relating to energy usage. Under the letter of intent, PAI will become a wholly-owned subsidiary of the Company. Subject to certain provisions, following the merger the current stockholders of PAI will hold approximately 92% of the total number of shares of the Company's common stock issued and outstanding after the merger (approximately 93% on a fully diluted basis assuming the exercise of all outstanding DENCOR ENERGY COST CONTROLS, INC. PAI stock options). The merger is subject to shareholder approval of both companies of matters related to the merger and certain other conditions. The Company has filed a joint proxy statement/prospectus with the Securities and Exchange Commission concerning certain matters related to the merger and has received comments from the SEC concerning this filling. The Company is awaiting reimbursement of expenses from PAI as set forth in the letter of intent and other information from PAI in order to respond to the SEC comments. Pursuant to the letter of intent, the proposed merger will be terminated if not completed on or before December 31, 1997, unless extended by both the Company and PAI. There is no assurance the merger will occur. Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NET SALES Third Quarter sales of $92,300 were approximately 7% less than sales for the comparable period in 1996. The decrease in third quarter sales compared to the prior year was a decrease in dealer sales. Year to date sales of $360,000 were approximately 20% greater than sales for the comparable period in 1996. The increase sales for the year to date period was the result of an increase in sales of utility products. COST AND EXPENSE Cost of Products Sold as a percentage of net sales decreased to 47.2% for the third quarter of 1997 compared with 50.0% for the same period in the prior year. Cost of Products Sold as a percentage of net sales decreased to 48.2% for year to date 1997 compared to 53.7% for the comparable period in 1996. The decrease for both periods was due to the sales of utility products with a higher software content resulting in a lower cost per unit of sales than other products. Selling expenses as a percentage of sales increased to 8.6% for the third quarter compared to 7.0% for the same period in the prior year. Selling expenses as a percentage of sales decreased to 5.1% for year to date compared to 5.4% for the comparable period in 1996. The increase for the third quarter was caused by a decrease in sales while the decrease for the year to date expense was due to increased sales. DENCOR ENERGY COST CONTROLS, INC. General and Administrative expenses increased from the same quarter in the prior year and year to date due to an increase in personnel. Research and Development expenses increased compared to the same quarter in the prior year and year to date due to increased software development activity related to new products. The Company anticipates that these new products will be available for sale during the fourth quarter 1997. EARNINGS The loss for the third quarter was $30,300 compared to loss of $5,900 for the same period in the prior year. The loss for the year to date was $18,400 compared to a loss of $22,400 for the comparable period in 1996. The increase in sales reduced the year to date loss compared to the prior year. The increased loss for the third quarter was due to increased software development and administrative activity as well as lower sales. LIQUIDITY The Independent Auditor's Report on Dencor Energy Cost Controls, Inc. Financial Statements for the year ended December 31, 1996 included a "going concern" explanatory paragraph which means that the Auditors have expressed substantial doubt about the Company's ability to continue as a going concern. Management's plans in regards to the factors which prompted the explanatory paragraph are discussed in Note 2 to the Company's December 31, 1996 Financial Statements. The Company's current ratio is .87 at the Quarter ended September 30, 1997. Management believes the acid ratio (cash and accounts receivable divided by current liabilities) of .24 is within the limits of reasonable liquidity. PART II OTHER INFORMATION Items 1 through 5 would appear to require no answers according to the instructions. Item 6. Exhibits And Reports On Form 8-K (a) The following Exhibit is filed as part of this Quarterly Report on Form 10-Q: 27. Financial Data Schedule. (b) During the quarter ended September 30, 1997, the Registrant did not file any reports on Form 8-K. DENCOR ENERGY CONTROLS, INC. SIGNATURE 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. DENCOR ENERGY COST CONTROLS, INC. Registrant By: Maynard L. Moe President Date: November 20, 1997 -----END PRIVACY-ENHANCED MESSAGE-----