-----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, MYZi6ZgHSjfHMQfC5nkGUQxKqKP4T8/DvX5BKbpuMZ1gZ0vQhrKmoYdWAE0DX/AN dFkMjKvqP+Mon1NFrhQ5RQ== 0001012709-99-000730.txt : 19991018 0001012709-99-000730.hdr.sgml : 19991018 ACCESSION NUMBER: 0001012709-99-000730 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990731 FILED AS OF DATE: 19991014 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: 99728215 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 - 10-QSB 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 July 31, 1999 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: (908) 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 July 31, 1999 - ----------------------- ---------------------------- Common Stock, par value 18,813,398 $.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 six and three months ended July 31, 1999. 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 financial statements at, and for the fiscal year ended January 31, 1999. FreeTrek.Com is a newly formed subsidiary of Multi Solutions, Inc. Multi Solutions, Inc retains approximately a 65% interest in FreeTrek.Com, Inc. The remaining approximately 35% interest in FreeTrek.Com, Inc. obtained by private investors for services and cash to fund initial software development and other startup activities. The results reflected for the six and three months ended July 31, 1999 are not necessarily indicative of the results for the entire fiscal year. Multi Solutions, Inc. owns 52% of Multi Soft, Inc.'s common stock. Multi Solutions Inc. financial statements are consolidated with its subsidiaries: Multi Soft, Inc., NetCast, Inc. (currently inactive), and FreeTrek.Com, Inc. which is currently in the development stage. The financial statements include the operation results of FreeTrek.Com, Inc. for the period ending July 31, 1999. FreeTrek did not have a material impact on the consolidated results of operations for Multi Solutions, Inc. FreeTrek.Com, Inc. is a provider of business system and internet software, solutions and support. The company has developed a powerful new software-based tool and promotion program for tapping into the marketing communication potential of the internet. Unlike many "broadcast" model internet marketing concepts, FreeTrek.Com offers major marketers the opportunity to communicate one-on-one with carefully defined private networks of their most valuable consumers. MULTI SOLUTIONS, INC. BALANCE SHEETS JULY 31, 1999 and JANUARY 31, 1999 31-Jul 31-Jan 1999 1999 ----------- ----------- ASSETS CURRENT ASSETS Cash $ 325,233 $ 18,420 Accounts Receivable (net of allowance of $43,783 and $43,783 respectively) 208,445 132,316 Prepaid expenses and other current assets 15,675 13,385 ----------- ----------- 549,353 164,121 FURNITURE AND EQUIPMENT Research and Development Equipment 15,518 63,526 Office furniture and other equipment 31,781 20,474 ----------- ----------- 47,299 84,000 Less: Accumulated Depreciation (18,315) (16,780) ----------- ----------- 28,984 67,220 Organizational costs 8,526 2,415 Less: Accumulated Amorization (968) (968) ----------- ----------- 7,558 1,447 OTHER ASSETS Capitalized software development costs 1,496,350 1,607,505 Less accumulated amortization (599,192) (809,915) ----------- ----------- 897,158 797,590 Intangibles 200 200 $ 1,483,253 $ 1,030,578 =========== =========== MULTI SOLUTIONS, INC. BALANCE SHEETS JULY 31 , 1999 and JANUARY 31, 1999
31-Jul 31-Jan LIABILITIES AND STOCKHOLDERS' 1999 1999 ----------- ----------- DEFICIENCY CURRENT LIABILITIES Loan payable to bank $ -- $ 796 Note Payable 6,565 6,565 Accrued payroll 23,284 -- Payroll and other taxes payable 18,785 19,480 Accounts Payable, Accrued expenses and other Current Liabilities 165,813 196,416 Accrued officer compensation 236,590 198,057 Deferred Revenues 195,835 187,648 ----------- ----------- 646,872 608,962 Deferred compensation due officer /shareholders 586,605 586,605 STOCKHOLDERS' DEFICIENCY Common stock, authorized 30,000,000 shares $.001 par value, issued and outstanding 13,509,473 (1999) and 13,509,473 (1999) 18,814 18,814 Additional paid-in capital, net of deferred compensation $27,907 (1999) and $41,365(1999) 8,668,328 8,661,197 Accumulated deficit (8,894,366) (8,845,000) ----------- ----------- (207,224) (164,989) MINORITY INTEREST 457,000 $ 1,483,253 $ 1,030,578 =========== ===========
MULTI SOLUTIONS, INC STATEMENTS OF OPERATIONS JULY 31, 1999 and JULY 31, 1998
Six Months Ended Three Months Ended 31-Jul 31-Jul 1999 1998 1999 1998 ------------ ------------ ------------ ------------ REVENUES License fees $ 76,099 $ 93,639 $ 16,375 $ 16,527 Maintenance fees 231,609 294,578 118,072 142,314 Consulting and Other fees 50,304 5,240 34,786 5,240 ------------ ------------ ------------ ------------ Total revenues 358,012 393,457 169,233 164,081 EXPENSES Software development and technical support 114,385 92,310 57,193 46,155 Selling and administrative 306,422 338,049 141,824 177,713 ------------ ------------ ------------ ------------ Total expenses 420,807 430,359 199,017 223,868 ------------ ------------ ------------ ------------ Income (Loss) from operations (62,795) (36,902) (29,784) (59,787) OTHER INCOME (EXPENSE) Other Revenues -- 5,237 -- 5,237 Interest Expense -- (889) -- (269) ------------ ------------ ------------ ------------ Total other income -- 4,348 -- 4,968 Net Income (Loss) $ (62,795) $ (32,554) $ (29,784) $ (54,819) ============ ============ ============ ============ Weighted average shares outstanding 18,813,398 18,407,648 18,813,398 18,548,398 ============ ============ ============ ============ Income (Loss) per share $ -- $ -- $ -- $ -- ============ ============ ============ ============
MULTI - SOLUTIONS, INC. 52 % owned subsidiary of Multi Solutions, Inc. STATEMENTS OF CASH FLOWS JULY 31 , 1999 and July 31 , 1998
31-Jul 31-Jul 1999 1998 ----------- ----------- Cash flows from operating activities Net Income $ (62,795) $ (32,554) Adjustments to reconcile net income to net cash provided by operating activities Depreciation and amortization 115,253 95,569 Changes in assets and liabilities Accounts receivable (76,129) (44,477) Prepaid expenses and other current assets (2,290) (23,925) Accrued payroll 23,284 51,499 Note Payable -- (7,298) Payroll and other taxes payable (695) (2,983) Accounts payable and accrued expenses (30,603) 14,580 Accrued officer compensation 38,533 87,498 Deferred revenues 8,187 (21,025) ----------- ----------- Net cash provided by operating activities 12,745 116,884 Cash flows from investing activities Capitalized Organizational Cost (6,111) Capitalized software development costs (163,156) (146,007) ----------- ----------- Net cash used in investing activities (169,267) (146,007) Cash flows from financing activities Net repayments under loan and line of credit ageements (796) (6,897) Amortization of Stock Grants 7,131 2,847 Issuances of Capital Stock 282 Increase (Decrease) in Minority Interest 457,000 6,739 ----------- ----------- Net cash provided (used) by financing activities 463,335 2,971 ----------- ----------- NET INCREASE (DECREASE) IN CASH 306,813 (26,152) Cash at beginning of year 18,420 29,524 ----------- ----------- Cash at end of period $ 325,233 $ 3,372 =========== ===========
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND ---------------------------------------------------------------------- RESULTS OF OPERATIONS --------------------- Results of Operations - --------------------- Six months ended July 31, 1999 compared to six months ended July 31, 1998 and - -------------------------------------------------------------------------------- three months ended July 31, 1999 compared to three months ended July, 31 1998 - ----------------------------------------------------------------------------- Revenues for the current six months of fiscal year 1999 decreased $35,205 or 9.8% compared with the comparable period of the prior year. Revenues for the three month period ending July 31, 1999 increased $5,392 or 3.2% compared with the comparable period of the prior year. The overall decrease in revenues for the current six month period is attributable a decrease in maintenance revenue during the current six month period. Operating expenses for the six month period decreased $9,552 or 22.7% compared with the comparable period of the prior year. Operating expense for the three month period ending July 31, 1999 decreased $24,851 or 12.5% compared with the prior year. The decrease in the six month and three month period was due to the reduction of certain expenses such as legal fees, outside marketing and a reduction in staff. Also, the software development expense has increased, $22,075. The reason for this increase in Software Development is that Multi Soft is amortizing capitalized development that was not being amortized in the prior period. Operating loss, before other Income (expense) of $62,795 for the current six month period increased $25,893 compared with the comparable period of the prior year. Operating loss, before other income (expense) was $29,784 for the current three month decreased $30,003 compared with the operating income from the comparable period of the prior year. The reason for this increase in the six month period operating loss is cancellations in maintenance coupled with a decrease in sales for the current six month period. Other Income (expense) for the current six month period was 0 as compared with 4,348 for the comparable period of the prior year. The decrease is attributable to a miscellaneous revenue in the comparable period that did not reoccur in the current period. For the current six month period , net loss of $62,795 or ($.00) cents per share was incurred compared with a net loss of $32,554 or ($.00) cents per share an decrease of $31,241. For the current three month period, a net loss of $29,784 was incurred compared with $54,819 in the comparable period for the prior year a decrease of $25,035. Major Customers - --------------- In the first six months of 1999, IBM accounted for 17.25% of total revenues. In the first six months of 1998, IBM accounted for 24.3%. Liquidity and Capital Resources - ------------------------------- At July 31, 1999, the Company had a negative working capital position of ($97,519); and has been experiencing cash flow problems. 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 subsidiary Multi Soft broadened its product base into the Windows environment and has made its Windows based products easier to learn and use. It is the company'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 the Company 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. 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 6. Exhibits and Reports on Form 8-K (a) Exhibits 27. Financial Data Schedule (b) Reports on Form 8-K 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. Dated: September 15, 1999 By:______________________________ Charles J. Lombardo, Chief Executive Officer, Chief Financial Officer and Treasurer EX-27 2 FINANCIAL DATA SCHEDULE
5 6-MOS JAN-31-1999 JUL-31-1999 325,233 0 208,445 43,783 0 533,678 47,299 13,787 1,467,578 646,872 0 18,814 0 0 (207,224) 1,483,253 76,099 358,012 114,385 420,807 0 0 0 (62,795) 0 (62,795) 0 0 0 (62,795) 0 0
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