-----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, AT7QWhZ++JYLEr+41KrljD91XMJsMy9hbGqIE5itP2qU0aE2eqOjRiiTislF4dpf f8Uv5Djenk+I9mzLpahk4Q== 0001050502-99-000251.txt : 19990507 0001050502-99-000251.hdr.sgml : 19990507 ACCESSION NUMBER: 0001050502-99-000251 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990331 FILED AS OF DATE: 19990506 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WORLD SERVICES INC CENTRAL INDEX KEY: 0000767410 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 460355586 STATE OF INCORPORATION: SD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-13499 FILM NUMBER: 99612046 BUSINESS ADDRESS: STREET 1: 404 S LINCOLN CITY: ABERDEEN STATE: SD ZIP: 57401 BUSINESS PHONE: 6052294404 MAIL ADDRESS: STREET 1: 404 S LINCOLN CITY: ABERDEEN STATE: SD ZIP: 57401 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTER REPORT UNDER SECTION 13 0R 15(d) 3-31-99 Quarter Ended______________Commission File Number____________ World Services, Inc. ----------------------------------------------------------------- (Exact name of registrant as specified in its charter) South Dakota 46-0355586 - -------------------------------------------------------------------------------- (State of other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) PO Box 786 Aberdeen, South Dakota 57402 - -------------------------------------------------------------------------------- (Address if principal executive offices) (Zip Code) (605) 225-4131 Registrant's telephone number, including area code_______________ Not Applicable - -------------------------------------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report.) Indicate by check whether the registrant (1) has filed all reports required to be filed by Section X 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 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. As of March 31, 1999, Registrant had 2,639,679 shares of its $.001 par value common stock outstanding. INDEX PART I. FINANCIAL INFORMATION: Item 1. Balance Sheet as of March 31, 1999 ............ 1 Statements of Operations for Quarters Ended March 31, 1999 and 1998 ....................... 2 Statements of Cash Flows for the Three Months Ended March 31, 1999 and 1998 ................. 3 Notes to Financial Statements ................. 4 Item 2. Management's discussion and Analysis of Financial Condition and Results of Operations: Liquidity and Capital Resources ............... 6 Results of Operations ......................... 7 PART II. OTHER INFORMATION: Item 1. Legal Proceedings ............................. 8 Item 2. Changes in Securities ......................... 8 Item 3. Default Upon Senior Securities ................ 8 Item 4. Submission of matters to a Vote of Security Holders ....................................... 8 Item 5. Other Information ............................. 8 Item 6. Exhibits and Reports on Form 10-Q ............. 8 WORLD SERVICES, INC. BALANCE SHEET March 31, 1999 ASSETS ------ CURRENT ASSETS Cash $ 32,199.01 Money Market Fund 49.49 Certificates of Deposit 1,031,424.26 Interest Receivable 18,483.73 ---------------- TOTAL CURRENT ASSETS 1,082,156.49 INVESTMENTS AND OTHER ASSETS Investment-Super 8 Developers 568,000.00 ---------------- TOTAL OTHER ASSETS 568,000.00 ---------------- TOTAL ASSETS $ 1,650,156.49 ================ LIABILITIES AND STOCKHOLDERS EQUITY ----------------------------------- CURRENT LIABILITIES Stock Redemption payable $ 42,317.25 ---------------- TOTAL CURRENT LIABILITIES 42,317.25 STOCKHOLDERS EQUITY Common stock, par value $.001 per share; (50,000,000 shares authorized)with 2,640,000 shares issued 2,715.00 Additional paid in capital 6,364,354.75 Accumulated Deficit (4,759,230.51) ---------------- TOTAL STOCKHOLDERS' EQUITY 1,607,839.24 ---------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,650,156.49 ================ 1 WORLD SERVICES, INC. STATEMENTS OF OPERATIONS For the Quarters Ended March 31, 1999 and 1998 1999 1998 ---- ---- REVENUE Interest Income $ 14,296.92 $ 3,162.76 ------------- ------------- TOTAL REVENUE 14,296.92 3,162.76 ------------- ------------- EXPENSES Accounting Fees 5,742.00 3,663.56 Contract Wages & Consulting 1,385.00 3,219.00 Faxes 18.75 72.00 Legal Fees 501.13 1,417.75 Director Fees 450.00 1,350.00 Office Supplies 0.00 136.48 Miscellaneous 0.00 308.00 Postage 105.60 259.37 Supplies 48.10 220.00 Telephone 10.98 108.96 Rent 750.00 750.00 ------------- ------------- TOTAL EXPENSES 9,011.56 11,505.12 ------------- ------------- INCOME(LOSS)BEFORE INCOME TAXES 5,285.36 (8,342.36) INCOME TAXES 0.00 0.00 ------------- ------------- NET INCOME (LOSS) $ 5,285.36 $ (8,342.36) ============= ============= INCOME PER SHARE (Basic & Diluted) * * ============= ============= WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 2,640,000 2,640,000 ============= ============= * Less than $0.01 per share. 2 WORLD SERVICES, INC. STATEMENTS OF CASH FLOWS For the Three Months Ended March 31, 1999 and 1998 1999 1998 ---- ---- CASH FLOWS FROM OPERATING ACTIVITIES Net Income $ 5,285.36 $(8,342.36) Adjustment to reconcile net income to net cash used in operating activities: (Increase) Decrease in: Interest Receivable 95.27 5,375.46 Other Assets 0.00 (8,177.82) Increase (Decrease) in: Accounts Payable (11,000.00) 0.00 Stock Redemption Payable (2,071.00) (3,293.50) ---------- ---------- NET CASH PROVIDED(USED)BY OPERATING ACTIVITIES (7,690.37) (14,438.22) ---------- ---------- CASH FLOWS FROM INVESTING ACTIVITIES Purchase of Certificates of Deposit (8,424.26) 0.00 ---------- ---------- NET CASH USED BY INVESTING ACTIVITIES (8,424.26) 0.00 ---------- ---------- NET INCREASE(DECREASE)IN CASH (16,114.63) (14,438.22) CASH AT BEGINNING OF PERIOD 48,313.64 65,451.44 ---------- ---------- CASH AT END OF PERIOD $32,199.01 $51,013.22 ========== ========== SUPPLEMENTAL DISCLOSURES Cash payments for: Income taxes $ 0.00 $ 0.00 ========== ========== Interest paid $ 0.00 $ 0.00 ========== ========== 3 WORLD SERVICES, INC. NOTES TO FINANCIAL STATEMENTS FOR THE PERIOD ENDED MARCH 31, 1999 In the opinion of management of World Services, Inc., (the Company), the accompanying unaudited financial statements reflect all adjustments (consisting of only normal recurring accruals) necessary to present fairly the financial position of the company as of March 31, 1999, and the results of operations and Statements of Cash Flows for the three months ended March 31, 1999 and 1998. These unaudited financial statements should be read in conjunction with the Company's annual report on Form 10-KSB for the year ended December 31, 1998. NOTE 1 - NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES - -------------------------------------------------------------------------------- A summary of significant accounting policies is currently on file with the Securities and Exchange Commission on Form 10-KSB. NOTE 2 - INCOME TAXES - -------------------------------------------------------------------------------- As of December 31, 1998, the Company had net operating loss carry forwards for income tax purposes totaling approximately $2,700,000 which expire in the years 1999 to 2011. The net operating loss carry forwards may be limited with respect to their availability due to prior ownership changes and the consolidated return regulations. NOTE 3 - Y2K COMPLIANCE - -------------------------------------------------------------------------------- The Failure of Systems and Equipment on which we depend to by Year 2000 compliant could adversely affect our business. Computer programs or other embedded technology that have been written using two digits to define the applicable year and that have time-sensitive logic may recognize a date using "00" as the Year 1900 rather than the Year 2000. This could result in widespread miscalculations or system failures. If we and the 4 WORLD SERVICES, INC. NOTES TO FINANCIAL STATEMENTS (CONT'D) FOR THE PERIOD ENDED MARCH 31, 1999 banks where we have deposits or the subsidiary company in which we hold a minority stock interest are unable to address Year 2000 issues in a timely manner, it could result in material financial risk, including the loss of revenue and unanticipated costs. Therefore, we plan to devote all resources necessary to resolve significant Year 2000 issues in a timely manner. Both information technology systems and non-IT systems using embedded technology may be affected by the Year 2000. We have completed the assessment phase of our Year 2000 program. We only have one computer and it's software is Y2K compliant. Since we are currently a non-operating company, we expect little impact of Y2K issues on our cash flow or financial condition. We have not completed the process or verification of whether banks and subsidiary with which we have material relationships are Year 2000 compliant. We intend to complete this verification process with our banks and subsidiary by the quarter ending June 30, 1999. The process of verification includes contacting each vendor's IT department to determine their state of Year 2000 readiness and requesting written documentation outlining each vendor's Year 2000 compliance plan. We estimate that expenditures for Year 2000 issues will be less than $1,000.00 for fiscal 1999. However, we are not able to determine the total costs for our year 2000 program or whether the Year 2000 will have a material effect on our financial condition, results of operations or cash flows. 5 WORLD SERVICES, INC. MANAGEMENTS'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis should be read in conjunction with the Financial Statements and Notes thereto appearing elsewhere in this report. LIQUIDITY AND CAPITAL RESOURCES - MARCH 31, 1999, COMPARED TO DECEMBER 31, 1998 - -------------------------------------------------------------------------------- During the three months ended March 31, 1999, cash decreased approximately $16,100, as a result of paying off accounts payable and purchasing certificates of deposits which are now held by the Company. Interest receivable decreased from $18,579 at December 31, 1998, to $18,484 at March 31, 1999. Primarily as a result of the decrease in cash, current assets decreased by $7,786, from $1,089,942 at December 31, 1998, to $1,082,156 at March 31, 1999. This decrease in cash is mainly due to paying off accounts payable. Current liabilities decreased $13,071 from $55,388 at December 31, 1998, to $42,317 at March 31, 1999. The decrease is the result of paying off accounts payable and payments made on stock redemption payable. As a result of the Company's net income for the three months of $5,285, the accumulated deficit decreased from $4,764,516 at December 31, 1998, to $4,759,231 at March 31, 1999. As a result, total stockholders equity increased from 1,602,554 at December 31, 1998, to $1,607,839 at March 31, 1999. In August of 1997, the Company completed a reverse stock split followed by a forward stock split. Following the reverse stock split, there were a number of fractional shares which were redeemed. Not all of the fractional shares had been submitted for payment by December 31, 1998 or March 31, 1999. As a result, the 'current liabilities' portion of the balance sheet reflects a "stock redemption payable." During the three months ended March 31, 1999, the Company redeemed outstanding fractional shares with a value of approximately $2,071. The total number of outstanding shares of common stock reflected on the balance sheet does not give any effect to the fractional shares outstanding. 6 WORLD SERVICES, INC. MANAGEMENTS'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) RESULTS OF OPERATIONS - THREE MONTHS ENDED MARCH 31, 1999 COMPARED TO THE THREE MONTHS ENDED MARCH 31, 1998 - -------------------------------------------------------------------------------- Total revenue for the three months ended March 31, 1999, was $14,297 as compared to $3,163 for the comparable period ended March 31, 1998, an increase of $11,134. Operating expenses were $9,012 for the three months ended March 31, 1999, compared to $11,505 for the comparable period ended March 31 1998, a decrease of $2,493. This decrease was in legal, director, and consulting fees. Based on the foregoing, the net income available to stockholders for the three months ended March 31, 1999, was $5,285, which translates to a net income per share of less than $0.01 based on 2,640,000 weighted average shares outstanding. This compares to the net loss after taxes for the three months ended March 31, 1998, of $8,342, which translates to a net loss per share of less than $0.01 based on 2,640,000 weighted average shares outstanding at that time. The weighted average number of shares has been adjusted for the reverse and forward stock splits completed in August of 1997 and for the repurchase of the fractional shares resulting from the reverse stock split, all as described in the Company's proxy statement for the shareholders' meeting August 1997. 7 WORLD SERVICES, INC. PART II. OTHER INFORMATION ITEM 1. - LEGAL PROCEEDINGS - -------------------------------------------------------------------------------- None. ITEM 2. - CHANGES IN SECURITIES - -------------------------------------------------------------------------------- None. ITEM 3. - DEFAULT UPON SENIOR SECURITIES - -------------------------------------------------------------------------------- None. ITEM 4. - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - -------------------------------------------------------------------------------- There were no shareholder meetings and no matters were submitted to a vote of shareholders during the first quarter of the fiscal year. ITEM 5. - OTHER INFORMATION - -------------------------------------------------------------------------------- None. ITEM 6. - EXHIBITS - -------------------------------------------------------------------------------- Exhibit 27 - Financial Data Schedule. 8 SIGNATURES ---------- Pursuant to the requirements of Section 13 or 15(d) 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. April 28, 1999 WORLD SERVICES, INC. By: /s/ Ronne Tarrell ---------------------------------- Ronne Tarrell, President, Chief Executive Officer and Principal Financial Officer 9 EX-27 2 FINANCIAL DATA SCHEDULE
5 3-MOS DEC-31-1999 JAN-01-1999 MAR-31-1999 1,063,672 0 18,484 0 0 1,082,156 0 0 1,650,156 42,317 0 0 0 2,715 1,605,124 1,650,156 0 14,297 0 0 9,012 0 0 5,285 0 0 0 0 0 5,285 .00 .00
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