-----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, VT3+0sL7VaGPP8OB+KWDAd/gEsp83uvqxqk6d17EufqOtOyN63YlY3LqAv4MYYAp v+XYwg2AqF1diyciTmM0lw== 0000950169-98-000499.txt : 19980514 0000950169-98-000499.hdr.sgml : 19980514 ACCESSION NUMBER: 0000950169-98-000499 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980331 FILED AS OF DATE: 19980513 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: EXOTECH INC CENTRAL INDEX KEY: 0000034047 STANDARD INDUSTRIAL CLASSIFICATION: INSTRUMENTS FOR MEAS & TESTING OF ELECTRICITY & ELEC SIGNALS [3825] IRS NUMBER: 540700888 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-04076 FILM NUMBER: 98617430 BUSINESS ADDRESS: STREET 1: 8502 DAKOTA DR CITY: GAITHERSBURG STATE: MD ZIP: 20877 BUSINESS PHONE: 3019483060 MAIL ADDRESS: STREET 1: 8502 DAKOTA DR CITY: GAITHERSBURG STATE: MD ZIP: 20877 FORMER COMPANY: FORMER CONFORMED NAME: RADIATION SYSTEMS INC DATE OF NAME CHANGE: 19681121 10-Q 1 EXOTECH SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES E6XCHANGE ACT OF 1934 FOR QUARTER ENDED: MARCH 31, 1998 COMMISSION FILE NO. 0-4076 --------------- ------ EXOTECH INCORPORATED -------------------------------------------------- (Exact name of Registrant as Specified in Charter) STATE OR JURISDICTION OF INCORPORATION OR ORGANIZATION: DELAWARE IRS IDENTIFICATION NO: 54-0700888 ADDRESS OF PRINCIPAL OFFICE: 8502 DAKOTA DRIVE GAITHERSBURG, MD. 20877 REGISTRANT'S TELEPHONE NUMBER: (301) 948-3060 INDICATE BY CHECKMARK 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 REQUIREMENT FOR THE PAST 90 DAYS. YES [X] NO [ ] INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER'S CLASSES OF COMMON STOCK, AS OF THE CLOSE OF THE PERIOD COVERED BY THIS REPORT. CLASS: COMMON STOCK, PAR VALUE $0.10 ----------------------------- OUTSTANDING AT MARCH 31, 1998 942,387 ------- EXOTECH INCORPORATED INDEX PART I FINANCIAL INFORMATION PAGE NO. CONSOLIDATED CONDENSED BALANCE SHEET March 31, 1998 AND JUNE 30, 1997......................... 2 CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS - NINE MONTHS ENDED MARCH 31, 1998 AND 1997................................... 3 STATEMENT OF CASH FLOWS FOR NINE MONTHS ENDED MARCH 31, 1998 AND 1997...................... 4 NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS...................................... 5 MANAGEMENT'S DISCUSSION AND ANALYSIS OF CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS............................................. 6 PART II OTHER INFORMATION OTHER FINANCIAL INFORMATION............................... 8 SIGNATURES................................................ 9 FINANCIAL DATA SCHEDULES (EX-27)..........................10 EXOTECH INCORPORATED CONSOLIDATED BALANCE SHEET
ASSETS March 31, June 30, 1998 1997 -------------- ------------- (Unaudited) CURRENT ASSETS Accts. Receivable, Net $ 18,258 $ 18,225 Inventories Work in Process 323,069 261,034 Raw Materials 32,625 32,625 Finished Goods 14,000 14,000 Other Current Assets 343 -0- Cash 1,098 3,431 ---------- ---------- Total Current Assets 389,393 329,315 PROPERTY, PLANT AND EQUIPMENT NET 206 294 OTHER NON-CURRENT ASSETS 5,297 5,993 ---------- ---------- TOTAL ASSETS 394,896 335,602 ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accts. Payable & Other Accrued Expenses 87,709 99,369 Other Current Liabilities 391,550 371,782 Notes Payable 428,219 385,294 ---------- ---------- Total Current Liabilities 907,478 856,445 SHAREHOLDERS EQUITY Common Stock, Par Value $.10 per share; 1,500,000 shares authorized; 970,135 issued; 942,387 outstanding 97,014 97,014 Paid-in-Surplus 1,169,645 1,169,645 Deficit (1,666,821) (1,675,082) Treasury Stock (27,748 shares) (112,420) (112,420) ---------- ---------- Total Shareholders' Equity (512,582) (520,843) TOTAL LIABILITIES & SHAREHOLDERS' EQUITY 394,896 335,602 ========== ==========
See accompanying Notes to Consolidated Condensed Financial Statements. 2 EXOTECH INCORPORATED CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
1998 1997 ----------------------------- ------------------------------ 3 Mos. 9 Mos. 3 Mos. 9 Mos. ----------- ENDED ----------- ------------ ENDED ----------- 3/31 3/31 3/31 3/31 REVENUE Contract Sales $132,178 $327,189 $137,171 $335,175 EXPENSES Direct Labor 3,216 8,954 2,573 7,909 Overhead 4,895 15,615 6,054 16,122 Materials 2,230 2,874 149 533 Other Direct Costs - - 5,000 5,000 Travel - 650 2,316 2,316 General & Administrative 722 3,170 2,114 3,110 Inventory Costs 100,889 258,034 111,669 262,869 -------- -------- -------- -------- Cost of Contract Services 112,602 289,297 129,875 297,859 Operating Income (Loss) 19,576 37,892 7,296 37,316 Miscellaneous Income -- -- -- -- Research and Development -- -- -- -- Interest & Other (9,487) (29,631) (8,771) (23,700) -------- -------- -------- -------- NET INCOME BEFORE TAXES 10,089 8,261 (1,475) 13,616 State Income Tax Provision -- -- -- -- -------- -------- -------- -------- NET INCOME (LOSS) 10,089 8,261 (1,475) 13,616 Weighted Average Number of Common Shares Outstanding 942,387 942,387 942,387 942,387 EARNINGS (LOSS) PER COMMON SHARE 0.01 0.01 (0.00) 0.01 DIVIDENDS PER COMMON SHARE None None None None
See accompanying Notes to Consolidated Condensed Financial Statements. These statements have been prepared from the books of account without audit. 3 EXOTECH INCORPORATED AND SUBSIDIARY STATEMENT OF CASH FLOWS FOR NINE MONTHS ENDED MARCH 31,
1998 1997 ---- ---- CASH FLOWS FROM OPERATING TRANSACTIONS Net Income (Loss) 8,261 13,616 Add: Non cash Income Determinants Depreciation and Amortization 784 826 Add (Deduct): Changes in Current Assets & Liabilities (Increase) Decrease in Accounts Receivable (33) (3,362) (Increase) Decrease in Prepaid Expenses (343) 280 (Increase) Decrease in Inventory (62,035) (21,963) Increase (Decrease) in Accts. Payable (11,660) (10,300) Increase (Decrease) in Payroll/Emp. Benefits (4,818) (9,177) Increase (Decrease) in Accrued Interest 24,586 20,550 ------- ------- Cash Provided By or (Used) For Operating Transactions (45,258) (9,530) CASH FLOWS FROM FINANCING TRANSACTIONS: Proceeds from Notes 66,789 39,800 Payments on Notes (23,864) (30,000) ------- ------- Cash Provided By or (Used For) Financing Transactions 42,925 9,800 CASH FLOWS FROM INVESTING TRANSACTIONS: Purchase of Equipment -- -- Deposits -- -- ------- ------- Cash Provided By or (Used For) Investing Transactions -- -- INCREASE (DECREASE) IN CASH (2,333) 270 CASH BALANCE - BEGINNING 3,431 105 ------- ------- CASH BALANCE - ENDING $1,098 $375 ======= =======
4 EXOTECH INCORPORATED NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS NOTE 1. In the opinion of Management, the accompanying unaudited consolidated condensed financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position as of March 31, 1998 and June 30, 1997 and the results of operations and changes in financial position for the nine months ended March 31, 1998 and 1997 of Exotech Incorporated and its inactive wholly-owned consolidated subsidiary, Exotech Research & Analysis, Inc. There are no significant intercompany transactions. NOTE 2. Per share computations have been based on the weighted average shares outstanding of 942,387 for the nine months ended March 31, 1998 and 1997. NOTE 3. Notes Payable at March 31, 1998 consist of four demand notes of $100,000, $8,000 and $47,000, payable with interest at 8.5% per annum to three of the Company's former directors. In addition, one demand note of $252,775 is payable with interest at 8.5% per annum to one officer/employee. Periodically, the Company has obtained producer loans from Spiral Biotech, Inc. that are secured by inventory instruments (Autoplaters). At March 31, 1998, there was an outstanding Producer Loan of $20,444 without interest charge. NOTE 4. Inventory cost shown in the cost of sales, represents the cost of production of goods sold that were incurred in the prior fiscal year. 5 MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS The following is Management's discussion and analysis of certain significant factors which have affected the Company's earnings during the periods included in the accompanying consolidated condensed statement of operations. A summary of the period to period changes in the principal items included in the consolidated statement of operations is shown below:
------------------------------------------ COMPARISON OF ---------------------------------------- THREE MONTHS THREE MONTHS NINE MONTHS ---------------------- -------------------- -------------------- Mar 31 Dec 31 Mar 31 Mar 31 Mar 31 Mar 31 1998 1997 1998 1997 1998 1997 Net Sales 132,178 143,076 132,178 137,171 327,189 335,175 Cost of Labor & Overhead 8,111 3,759 8,111 8,627 24,589 24,031 G&A Expense 722 690 722 2,114 3,170 3,110 Inventory Cost 100,889 125,070 100,889 111,669 258,034 262,869 -------- -------- -------- -------- -------- -------- Cost of Sales 112,602 129,519 112,602 129,875 289,297 297,859 Interest & Other 9,487 10,887 9,487 8,771 29,631 23,700
6 I. CHANGE IN FINANCIAL POSITION IN THE NINE MONTHS ENDED MARCH 31, 1998. In the nine months period ended March 31, 1998, a reduction of the working capital deficit of $9,045 resulted from a net profit from operations of $8,261 and non-fund charges of $784. Producer loans totalling $40,500 - obtained from Spiral Biotech, Inc. in this period were paid-down prior to $20,444 to the end of the period. Additional loans amounting to $22,481 obtained from an officer of the Company in this period are outstanding. An order received in March 1998 from Spiral Biotech, Inc. increased backlog at the end of the period by $32,000 for instruments scheduled for deliveries in May 1998. Negotiations completed at the end of the most recent quarter will further increase backlog early in the next quarter by $150,000. II. INCOME AND EXPENSE IN THE MOST RECENT QUARTER AND NINE MONTH PERIOD AND THE SAME QUARTER AND NINE MONTHS PERIOD LAST YEAR. Revenue for the quarter ended March 31, 1998, at $132,178, was $4,993 lower compared to the same period one year earlier. Operating income was $19,576 compared to $7,296 in the quarter ended March 31, 1997. The earlier period had higher indirect costs related to the hiring and training of an employee following the retirement of a key staff member. In the opinion of Management, results in the most recent quarter show a continuation of modest progress over the past three quarters toward profitable operations and recovery from the large losses incurred in the prior year. For the nine months period ended March 31, 1998, revenue of $327,189 was two percent lower than that achieved one year earlier. On the same basis of comparison, the cost of sales was lower by about three percent. Interest expense in the recent period was higher by 25 percent, reflecting the necessity of increased borrowing to provide for purchases of material at the outset of new production runs resulting in a net profit of $8,261, compared to $13,616 in the prior year. In the opinion of management, the increasing frequency of large increases in backlog for existing product lines will materially reduce the cash flow interruptions that have been experienced between the end of one production run and the first billable products of the subsequent production run. Furthermore, economies of scale will become available to reduce costs. These changes reflect progress toward improved operating conditions for the Company after an intense and very costly effort to develop a new product in prior fiscal years. 7 PART II. OTHER FINANCIAL INFORMATION ITEM 5. As in the past, a shortage of working capital continues to be a significant problem, limiting efforts to develop new business to the fullest extent possible, as well as causing occasional delays of 30 to 45 days in payments to suppliers of materials for manufacturing. In the most recent nine months period, the accounts payable more than 30 days old was reduced by about 65 percent, from $66,800 to $24,000. Management also is continuing to pursue opportunities to affiliate with other companies to increase marketing and sales of its products and develop new products from Exotech's proprietary technology. In the opinion of Management, the Company should be in a position to sustain operations at least until such time as the results of current contracts and negotiations for new business is determinable. Ultimate realization of the carrying value of prepaid expenses and advances, property and equipment, and miscellaneous other assets shown in the accompanying balance sheet depend on the effect of the matters discussed herein. The dollar amount of the backlog as of March 31, 1998 was $168,900, lower by $97,000 compared to that of the prior year, and $48,200 lower than the backlog at December 31, 1997. An order received in March, 1998 increased backlog by $32,000 for products that will be purchased in May. Further orders have been negotiated that will add a minimum of $150,000 to the backlog in the quarter beginning April 1, 1998. ITEM 6 (B) There were no reports filed on Form 8-K for the nine months ended March 31, 1998. 8 SIGNATURE Pursuant to the requirements of the Securities Act of 1934, the Company has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized. EXOTECH INCORPORATED REGISTRANT DATE: May 13, 1998 _____________________ ____________________________________ ROBERT G. LYLE, PRESIDENT AND CHIEF EXECUTIVE OFFICER 9 EX-27 2 FINANCIAL DATA SCHEDULE
5 9-MOS JUN-30-1998 MAR-31-1998 1,098 0 18,258 0 369,694 389,393 231,530 231,324 394,896 907,478 0 0 0 97,014 (512,582) 394,896 327,189 327,189 289,297 289,297 0 0 29,631 8,261 0 8,261 0 0 0 8,261 0.01 0.01
-----END PRIVACY-ENHANCED MESSAGE-----