-----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, GBoo30QYO+VgbwfQRSSveNBPzUkZbi6lombQs+0YqYlZr8UdSf6wt7Y0zbZ3X5Lu zzrl3Sy4CWcL3yKoC+vZ1g== 0001012709-98-000222.txt : 19980616 0001012709-98-000222.hdr.sgml : 19980616 ACCESSION NUMBER: 0001012709-98-000222 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19980430 FILED AS OF DATE: 19980615 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: MULTI SOLUTIONS INC CENTRAL INDEX KEY: 0000723733 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 222418056 STATE OF INCORPORATION: NJ FISCAL YEAR END: 0131 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 000-12162 FILM NUMBER: 98648141 BUSINESS ADDRESS: STREET 1: 4262 US ROUTE 1 STREET 2: SUITE 2 CITY: MONMOUTH JUNCTION STATE: NJ ZIP: 08852 BUSINESS PHONE: 9083299200 MAIL ADDRESS: STREET 1: 4262 US HIGHWAY 1 STREET 2: SUITE 2 CITY: MONMOUTH JUNCTION STATE: NJ ZIP: 08852-1905 10QSB 1 MULTI SOLUTIONS, INC - 1ST QUARTER 10QSB SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended April 30, 1998 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: 0-12162 ------- MULTI SOLUTIONS, INC - -------------------------------------------------------------------------------- (Exact name of small business issuer as specified in its charter) NEW JERSEY 22-2418056 - ------------------------------- ----------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 4262 US Route 1, Monmouth Junction, New Jersey 08852 ---------------------------------------------------- (Address of principal executive offices) Issuer's telephone number, including area code: (732) 329-9200 -------------- 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 ------- ------- Indicate the number of shares outstanding of each of the issuer's classes of Common Stock, as of the latest practicable date. Class Outstanding at April 30, 1998 - ----------------------- ----------------------------- Common Stock, par value 18,266,898 $.001 per share PART I. FINANCIAL INFORMATION - ------------------------------- ITEM 1. FINANCIAL STATEMENTS -------------------- The accompanying consolidated financial statements are unaudited for the interim periods, but include all adjustments (consisting only of normal recurring accruals) which management considers necessary for the fair presentation of results for the three months ended April 30, 1998. Moreover, these consolidated financial statements do not purport to contain complete disclosure in conformity with generally accepted accounting principles and should be read in conjunction with the Company's audited consolidated financial statements at, and for the fiscal year ended January 31, 1998. The results for the three months ended April 30, 1998 are not necessarily indicative of the results for the entire fiscal year. Multi Solutions, Inc. ( the "company") owns 55.4% of Multi Soft, Inc's common stock. The companies financial statements are consolidated with Multi soft and its other subsidiary, NetCast, Inc. which is currently in the development stage. MULTI SOLUTIONS,INC AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS April 30, 1998 and January 31 1998 30-Apr 31-Jan 1998 1998 Unaudited ----------- ----------- ASSETS CURRENT ASSETS Cash $ -- $ 29,524 Accounts Receivable (net of allowance of $29,086 and $29,086 respectively) 132,196 58,635 Prepaid expenses and other current assets 37,799 20,799 ----------- ----------- 169,995 108,958 FURNITURE AND EQUIPMENT Research and Development Equipment & Software 63,526 63,526 Office furniture and other equipment 20,474 20,474 ----------- ----------- 84,000 84,000 Less: Accumulated Depreciation (12,461) (10,952) ----------- ----------- 71,539 73,048 Organizational costs 2,415 2,415 Less: Accumulated Amorization (605) (484) ----------- ----------- 1,810 1,931 OTHER ASSETS Capitalized software development costs 1,419,567 1,716,121 Less accumulated amortization (616,276) (939,942) ----------- ----------- 803,291 776,179 Intangibles 200 200 ----------- ----------- $ 1,046,835 $ 960,316 =========== =========== MULTI SOLUTIONS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS April 30, 1998 and January 31 1998
30-Apr 31-Jan 1998 1998 Unaudited ----------- ----------- LIABILITIES AND STOCKHOLDERS' DEFICIENCY CURRENT LIABILITIES Loan payable to bank $ 13,610 $ 16,338 Note Payable 9,549 11,339 Accrued payroll 71,434 20,080 Payroll and other taxes payable 17,803 32,755 Accounts Payable 185,455 167,269 Accrued officer compensation 203,056 153,057 Deferred Revenues 153,465 191,820 ----------- ----------- 654,372 592,658 Deferred compensation due officer /shareholders 631,605 631,605 STOCKHOLDERS' DEFICIENCY Common stock, authorized 40,000,000 shares $.001 par value, issued and outstanding 18,267 18,267 18,266,898 April 30(1998) and 18,266,898 January 31 (1998) Additional paid-in capital, 8,643,850 8,643,517 Minority Interest 88,027 87,821 Accumulated deficit (8,989,286) (9,013,552) ----------- ----------- (239,142) (263,947) $ 1,046,835 $ 960,316 =========== ===========
MULTI SOLUTIONS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS Quarters ended April 30, 1998 and 1997 Three Months Ended April 30, 1998 1997 ------------ ------------ REVENUES License fees $ 77,112 $ 30,369 Maintenance fees 152,264 203,660 Consulting and Other fees -- 24,790 ------------ ------------ Total revenues 229,376 258,819 EXPENSES Software development and technical support 46,155 64,646 Selling and administrative 160,336 193,772 ------------ ------------ Total expenses 206,491 258,418 ------------ ------------ Income from operations 22,885 401 OTHER EXPENSE Interest Expense 620 654 ------------ ------------ Total other expense 620 654 ------------ ------------ Net Income (Loss) $ 22,265 $ (253) ============ ============ Weighted average shares outstanding 18,266,898 18,016,598 ============ ============ Income per share a a ============ ============ (a) less then $.01 per share MULTI SOLUTIONS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Quarters ended April 30, 1998 and 1997
Three Months Ended April 30, 1998 1997 -------- --------- Cash flows from operating activities $ 22,265 $ (253) Net Income (Loss) Adjustments to reconcile net income (loss) to net cash provided by operating activities Depreciation and amortization 47,785 72,752 Changes in assets and liabilities Accounts receivable (73,561) (124,828) Prepaid expenses and other current assets (17,000) (4,000) Accrued payroll 51,354 27,891 Payroll and other taxes payable (14,952) (8,724) Note Payable (1,790) (1,998) Accounts payable and accrued expenses 18,186 (9,289) Accrued officer compensation 49,999 33,334 Deferred revenues (38,355) 64,118 -------- --------- Net cash provided by operating activities 43,931 49,003 Cash flows from investing activities Capitalized software development costs (73,267) (55,173) -------- --------- Net cash used in investing activities (73,267) (55,173) Cash flows from financing activities Net repayments under loan and line of credit ageements (2,728) (3,845) Increase in Minority Interest 2,207 (1,526) Amortization of Stock Grants 333 334 -------- --------- Net cash used by financing activities (188) (5,037) -------- --------- NET INCREASE (DECREASE) IN CASH (29,524) (11,207) Cash at beginning of year 29,524 13,575 -------- --------- Cash at end of year $ -- $ 2,368 ======== =========
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND ---------------------------------------------------------------------- RESULTS OF OPERATIONS --------------------- Results of Operations - --------------------- Three months ended April 30, 1998 compared to three months ended April 30, 1997 - ------------------------------------------------------------------------------- Revenues for the current three months of fiscal year 1998 decreased $29,443 or 11.4% compared with the comparable period of the prior year. The decrease in revenues for the three month period is primarily attributable to a decrease in maintenance revenues and consulting fees of $76,186 or 33.3%. This is attributable to cancellations of maintenance agreements with customers of Multi Soft whom have been paying for monthly maintenance and support. The decrease is partially offset by an increase in license fees in the amount of $46,743 or 154.1%. This increase is primarily attributed to a significant sale that ocurred in the first quarter of the current year. Operating expenses as a percent of revenues for the three month period was 90% compared with 99.8% for the comparable period of the prior year. The decrease in the three month period is a result of a decrease in Selling and Administrative expenses of 33,082 or 17%. This reduction is primarily a result of the inactivity of the companys other subsidiary coupled with an effort by management to reduce certain expenses such as legal fees, outside marketing and outside consulting. Also, software development decreased for the current three month period in the amount of $18,491 or 28.6%. The reduction is attributed to zero amortization for the capitalized values of fical 98 and the current quarter. Amortization of the capitalized values for fiscal 98 and for the first quarter of the current year have not been expensed because during that period Multi Soft has been developing a new product that is not ready for sale. The operating income, before other income (expense) of $22,885 for the current three month period increased $22,484 compared with the comparable period of the prior year. For the current three month period, a net income of $22,265 was incurred compared with a net loss of $253 a increase of $22,518. Major Customers - --------------- In the first three months of 1998, IBM accounted for 20% of total revenues. In the first three months of 1997, IBM accounted for 29% of total revenues. Liquidity and Capital Resources - ------------------------------- At April 30, 1998, the Company had a negative working capital position of ($484,377) and has been experiencing cash flow problems. The cash flow deficiency derives from certain outstanding receivable that remain uncollected coupled with normal fluctuations in sales. Management of the company has taken various steps to correct this situation. Overhead costs have been cut drastically as a result of staff reductions and curtailment of all outside marketing and advertising costs. In addition, senior staff salaries were reduced and executive officers' salaries were partly deferred. Secondly, the company's 55.4% owned subsidiary, Multi Soft Inc. broadened its product base into the Windows environment and has made its Windows based products easier to learn and use. During the summer Multi Soft plans to introduce a new product which extends its present product line into the internet. In September 1994, Multi Soft entered into an International Software Licensing Agreement with IBM's Personal Communications 3270 division ("P-Comm"). This agreement allows IBM to logo and market a P-Comm specific version of both the Toolkit and Runtime of Multi Soft's WCLTM. Pursuant to this agreement, the Company will receive a minimum of $75,000 per quarter over a two year period representing minimum advances against royalties. As of November 1996, the contract with IBM was extend for two more years and IBM is paying Multi Soft monthly maintenance and royalties. It is Multi Soft's intent to remain a technology provider and search out multiple distribution channels, rather than to try and grow via an expensive direct sales force. This allows the focus to stay on technology, with a low overhead cost for each distribution channel used. However, if Multi Soft obtains additional funds from operations or otherwise, it plans to expand in-house marketing activities by advertising in trade publications and by conducting targeted mailing. Dividend Policy - --------------- The Company has not declared or paid any dividends on its common stock since its inception and does not anticipate the declaration or payment of cash dividends in the foreseeable future. The Company intends to retain earnings, if any, to finance the development and expansion of its business. Future dividend policy will be subject to the discretion of the Board of Directors and will be contingent upon future earnings, if any, the Company's financial condition, capital requirements, general business conditions and other factors. Therefore, there can be no assurance that dividends of any kind will ever be paid. Year 2000 - --------- Many companies systems experience problems handling dates beyond the year 1999. The companies products are not directly impacted by this problem. In particular, year 2000 issues are transparent to WCL. WCL simply transports data between the 3270/5250 presentation space and the client application. WCL does no formatting of any data, including dates. This is handled by the client developement tool such as VB,PB and VC++. Therefore, Year 2000 issues must be addressed by these development tools, not WCL. In addition, The Company's INFRONT and QuickFRONT product have built in support for the Year 2000. Any date functions that use 2 positions for the year, the SETUPSL command can be used to handle the year 2000. Effect of Inflation - ------------------- Management believes that inflation has not had a material effect on its operations for the periods presented. Cautionary Statement - -------------------- This Form 10-KSB contains certain forward-looking statements regarding, among other things, the anticipated financial and operating results of the company. For this purpose, forward-looking statements are any statements contained herein that are not statements of historical fact and include, but are not limited to, those preceded by or that include the words, "believes," "expects," "anticipated," or similar expressions. In connection with the safe harbor provisions of the Private Securities Litigation Reform act of 1995, the Company is including this cautionary statement identifying important factors that could cause the company's actual results to differ materially from those projected in forward looking statements made by, or on behalf of, the company. These factors, many of which are beyond the control of the company and include the Company's ability to, (I) continue as a going concern, (ii) continue to receive royalties from its existing licensing and consulting arrangements(iii) develop additional marketable software and technology, (iv) compete with larger, better capitalized competitors, and reverse ongoing liquidity and cash flow problems. PART II - OTHER INFORMATION - --------------------------- Item 1. Exhibits and Reports on Form 8-K (a) Exhibits 27. Financial Data Schedule (b) Reports on Form 8-K None SIGNATURES ---------- Pursuant to the requirements of the Securities and Exchange Act of 1934, the registration has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. MULTI SOLUTIONS, INC. Date June 2, 1998 By: ---------------------------------------- Charles J. Lombardo, Chief Executive Officer, Chief Financial Officer and Treasurer EX-27 2 MULTI SOLUTIONS, INC. - FINANCIAL DATA SCHEDULE
5 3-MOS JAN-31-1998 APR-30-1998 0 0 132,196 29,086 0 169,995 84,000 12,461 1,046,835 649,962 0 0 0 18,267 239,142 1,046,835 77,112 229,376 0 0 620 0 620 22,265 0 22,265 0 0 0 22,265 0 0
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