-----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, TPvmKIEHSXPXnv3vOgQUVVTPV/fVp0fDGt19SI0TWRHCGLnWUsHnDOiurTQffuMg 2+x8wOzK3Eu8V/sXEaVDxA== 0000910647-97-000180.txt : 19970813 0000910647-97-000180.hdr.sgml : 19970813 ACCESSION NUMBER: 0000910647-97-000180 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970812 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: MEGATECH CORP CENTRAL INDEX KEY: 0000064708 STANDARD INDUSTRIAL CLASSIFICATION: MISCELLANEOUS PUBLISHING [2741] IRS NUMBER: 042461059 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-09643 FILM NUMBER: 97657340 BUSINESS ADDRESS: STREET 1: 525 WOBURN STREET CITY: TEWKSBURY STATE: MA ZIP: 01876 BUSINESS PHONE: 6172731900 MAIL ADDRESS: STREET 1: 525 WOBURN STREET CITY: TEWKSBURY STATE: MA ZIP: 01876 10-Q 1 FORM 10-Q FOR THE 2ND QUARTER SECURITIES AND EXCHANGE COMMISSION Washington, DC. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended June 30, 1997 Commission File Number 0-9643 - ------------------------------------------------------------------------ MEGATECH CORPORATION - ------------------------------------------------------------------------ (Exact name of registrant as specified in its charter) Massachusetts 04-2461059 - ------------------------------------------------------------------------ (State or other jurisdiction of (IRS. Employer incorporation of organization) Identification No.) 555 WOBURN Street, TEWKSBURY, MA 01876 - ------------------------------------------------------------------------ (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (508) 937-9600 - ------------------------------------------------------------------------ N/A - ------------------------------------------------------------------------ (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark 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 requirements for the past 90 days. YES X NO ___ - ------------------------------------------------------------------------ The number of shares of the registrant's common stock outstanding as of June 30, 1997 was 3,788,808. MEGATECH CORPORATION BALANCE SHEET
JUNE 30 DECEMBER 31 1997 1996 (UNAUDITED) AUDITED - -------------------------------------------------------------------------- ASSETS Current assets: Cash and cash equivalents $ 92,140 $ 90,770 Accounts receivable : Trade (less allowance for doubtful accounts of $13,047) 258,043 407,169 Affiliate 0 50,945 Other receivables 9,365 2,024 Inventories at lower of cost (first-in first-out) or market 373,832 380,379 Prepaid expenses 6,342 17,127 - ------------------------------------------------------------------------- Total current assets 739,722 948,414 - ------------------------------------------------------------------------- Property, plant and equipment, at cost (net of accumulated depreciation of $366,884) 95,768 96,370 Security deposits 7,666 7,666 - ------------------------------------------------------------------------- Total Assets $ 843,156 $1,052,450 =========================================================================
MEGATECH CORPORATION BALANCE SHEET
JUNE 30 DECEMBER 31 1997 1996 (UNAUDITED) AUDITED - -------------------------------------------------------------------------- LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable Trade 179,662 309,562 Affiliate 0 8,701 Accrued commissions 6,999 32,622 Other accrued liabilities 28,749 40,058 Current obligation under capital lease 0 1,252 - ------------------------------------------------------------------------- Total current liabilities 215,410 392,195 - ------------------------------------------------------------------------- Stockholders' equity: Common Stock, par value $.0143 per share, 5,000,000 shares authorized; 3,785,208 & 3,762,258 shares issued and outstanding 54,180 54,180 Additional paid-in capital 4,034,824 4,034,824 Deficit (3,461,258) (3,428,749) - ------------------------------------------------------------------------- Total stockholders' equity 627,746 660,255 - ------------------------------------------------------------------------- Total Liabilities and Stockholders' Equity $ 843,156 $1,052,450 =========================================================================
MEGATECH CORPORATION STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 1997 1996 (UNAUDITED) (UNAUDITED) - ------------------------------------------------------------------------- Sales $1,092,071 $ 899,053 Cost of goods sold 620,893 585,076 - ------------------------------------------------------------------------ Gross profit 471,178 313,977 Operating expenses: Selling, general and administrative expenses 498,227 425,964 Research and development 7,117 8,241 - ------------------------------------------------------------------------ Profit (loss) from operations (34,166) (120,229) Other income and (expense): Interest 1,706 (630) Other 75 0 Legal (124) 0 - ------------------------------------------------------------------------ Total other income and (expense) 1,657 (630) Net profit (loss) ($ 32,509) ($ 120,858) ======================================================================== Net profit (loss) per share ($ 0.009) ($ 0.032) ======================================================================== Weighted average number of shares outstanding 3,784,566 3,785,208 ========================================================================
MEGATECH CORPORATION STATEMENT OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1997 1996 (UNAUDITED) (UNAUDITED) - ------------------------------------------------------------------------- Cash flows from operating activities: Net profit (loss) ($ 32,509) ($120,858) Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 10,962 16,311 Changes in operating assets and liabilities: Accounts receivable, trade 200,072 257,191 Accounts receivable, other (2,619) (3,066) Prepaid expenses 6,062 (8,829) Inventories 6,218 18,468 Notes payable (22) (38,344) Accounts payable (138,272) (73,851) Accrued expenses (20,932) (4,335) Security deposit 0 0 - ----------------------------------------------------------------------- Net cash provided (used) by operating activities 28,960 42,688 Cash flows from investing activities: Purchases of property and equipment (10,359) (5,268) Cash flows from financing activities: Payments on capital lease obligations (1,230) 0 Proceeds from issuance of common stock 0 315 Additional paid in capital 0 2,985 - ----------------------------------------------------------------------- Net cash used by financing activities (1,230) 3,300 Net increase (decrease) in cash and cash equivalents 17,371 40,720 Cash & cash equivalents, beginning of period 90,770 55,578 - ----------------------------------------------------------------------- Cash & cash equivalents, end of period $108,141 $ 96,298 =======================================================================
MEGATECH CORPORATION NOTES TO FINANCIAL STATEMENTS JUNE 30, 1997 1. BASIS OF PRESENTATION: The accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete Financial Statements. In the opinion of management, all adjustments necessary to present fairly the financial position, results of operations and cash flows at June 30, 1997 and for all periods presented have been made. The results of operation for the three months ended June 30, 1997 are not necessarily indicative of the operating results that may be expected for the year ended December 31, 1997. It is suggested that the financial statements be read in conjunction with the financial statements and notes thereto included in the Company's 1996 annual report. 2. INVENTORIES: Inventories consist of the following:
JUNE 30 DECEMBER 31 1997 1996 ------------------------------------------------------- Raw materials 150,724 357,045 Work in process 78,709 0 Finished goods 154,399 23,334 --------------------------------------------------- 383,832 380,379 Less reserve for obsolescence 10,000 10,000 --------------------------------------------------- 373,832 370,379 ===================================================
3. MAJOR CUSTOMER INFORMATION: For the period ended June 30, 1997, sales to three unrelated sales representatives comprised 9%, 10%, and 25% of total sales, respectively. For the period ended June 30, 1996, sales to two unrelated sales representatives comprised 11% and 26%, respectively. MEGATECH CORPORATION MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR SIX MONTHS ENDED JUNE 30, 1997 AND 1996 RESULTS OF OPERATIONS: Sales for the six months ended June 30, 1997 increased by $193 thousand or 21% from the corresponding period of 1996 to $1.1 million. This increase was primarily due to an increase in overall sales, specifically in the automotive area. Gross profit for the six months ended June 30, 1997 increased from the corresponding period of 1996 by $157 thousand. As a percentage of total sales, gross profit was 43% in the six months ended June 30, 1997 as compared to 35% in the corresponding period of 1996. The increase was primarily due to lower direct labor and overhead costs relative to the operations. Selling, General & Administrative expenses for the six months ended June 30, 1997 increased from the corresponding period of 1996 by $79 thousand or 19% to $.5 million. The increase is primarily a result of higher selling and marketing expenses due to increased sales. Research and Development expenses for the six months ended June 30, 1997 remained fairly steady compared to the corresponding period of 1996 at $8 thousand and $7 thousand, respectively. LIQUIDITY AND CAPITAL RESOURCES: Working capital for the six months ended June 30, 1997 was $524,312 as compared to $500,166 in working capital at June 30, 1996. The increase was primarily attributable to higher inventory, offset slightly by lower accounts receivable. The company maintains a secured line of credit in the amount of $200,000. At June 30, 1997, no borrowings were outstanding under this line. The company believes that cash generated from operations, together with existing sources of debt financing, will be sufficient to meet foreseeable cash requirements for the next twelve months. The firm's backlog as of June 30, 1997 was approximately $313,370 compared to $437,661 for the same period ended in 1996. PART II: OTHER INFORMATION Item 1. Legal Proceedings: Not applicable Item 2. Changes in Securities: Not applicable Item 3. Defaults Upon Senior Securities: Not applicable Item 4. Submission of Matters to a Vote of Security Holders: Not applicable Item 5. Other Information: Not applicable Item 6. Exhibits and Reports in Form 8-K: Not applicable 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. MEGATECH CORPORATION (Registrant) June 30, 1997 /s/ Vahan V. Basmajian Date Vahan V. Basmajian President, Treasurer EX-27 2 ARTICLE 5 FDS FOR THE 2ND QUARTER
5 6-MOS DEC-31-1997 JUN-30-1997 92,140 0 258,043 13,047 373,832 739,722 95,768 366,884 843,156 215,410 0 0 0 54,180 0 843,156 1,092,071 1,093,852 620,893 505,344 124 0 1,706 (32,509) 0 (32,509) 0 0 0 (32,509) (0.009) (0.009)
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