-----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, Rwv+HmbXch7zMLGz/lnFITmoBRCDobUns4hx3rudNrSfi91xqsJtmRtM09GwHa/d ZmxY9EreUeJUzWF8AWPmuw== 0001050502-99-000820.txt : 19991108 0001050502-99-000820.hdr.sgml : 19991108 ACCESSION NUMBER: 0001050502-99-000820 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990930 FILED AS OF DATE: 19991105 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: 10QSB SEC ACT: SEC FILE NUMBER: 000-13499 FILM NUMBER: 99742129 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 10QSB 1 FORM 10-QSB UNITED STATES 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 9-30-99 OR [ ] Transition Report under Section 13 or 15(d) of the Exchange Act For the transition period from ____________ to ________________ Commission File No. 0- World Services, Inc. -------------------------- (Exact name of small business issuer as specified in its charter) A _______ corporation I.R.S. Employer Identification No. 46-0355586 PO Box 786 Aberdeen, SD 57402 ------------------------------ (Address of Principal Executive Offices) (605) 225-4131 ----------------------- (Registrant's telephone number, including area code) Not Applicable ----------------------- (former address, if changed from last report) APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS Check whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. ___X___Yes _______No APPLICABLE ONLY TO CORPORATE ISSUERS State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: As of September 30, 1999, there were 2,639,679 shares of common stock outstanding. Transitional Small Business Disclosure Format (Check one):Yes[ ] No[x] INDEX PART I. FINANCIAL INFORMATION: Item 1. Balance Sheet as of September 30, 1999 ........ 1 Statements of Operations for Quarters Ended September 30, 1999 and 1998 ................... 2 Statements of Operations for the Nine Months Ended September 30, 1999 and 1998 ............. 3 Statements of Cash Flows for the Nine Months Ended September 30, 1999 and 1998 ............. 4 Notes to Financial Statements ................. 5 Item 2. Management's discussion and Analysis of Financial Condition and Results of Operations: Liquidity and Capital Resources ............... 6 Results of Operations ......................... 7 Y2K Compliance ................................ 8 PART II. OTHER INFORMATION: Item 1. Legal Proceedings ............................. 10 Item 2. Changes in Securities ......................... 10 Item 3. Default Upon Senior Securities ................ 10 Item 4. Submission of matters to a Vote of Security Holders ....................................... 10 Item 5. Other Information ............................. 10 Item 6. Exhibits and Reports on Form 10-Q ............. 10 WORLD SERVICES, INC. BALANCE SHEET September 30, 1999 ASSETS CURRENT ASSETS Cash $ 26,370.08 Money Market Fund 49.49 Certificates of Deposit 1,094,246.58 Interest Receivable 31,448.08 -------------- TOTAL CURRENT ASSETS 1,152,114.23 INVESTMENTS AND OTHER ASSETS Investment-Super 8 Developers 568,000.00 -------------- TOTAL OTHER ASSETS 568,000.00 -------------- TOTAL ASSETS $ 1,720,114.23 ============== LIABILITIES AND STOCKHOLDERS EQUITY CURRENT LIABILITIES Stock Redemption payable $ 42,329.75 Accounts Payable 5,500.00 -------------- TOTAL CURRENT LIABILITIES 47,829.75 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 (4,694,785.27) -------------- TOTAL STOCKHOLDERS' EQUITY 1,672,284.48 -------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,720,114.23 ============== 1 WORLD SERVICES, INC. STATEMENTS OF OPERATIONS For the Quarters Ended September 30, 1999 and 1998 1999 1998 ---- ---- REVENUE Dividend Income $ 0.00 $ 159,390.40 Interest Income 11,677.87 13,502.33 ------------- ------------- TOTAL REVENUE 11,677.87 172,892.73 ------------- ------------- EXPENSES Accounting Fees 2,759.51 2,399.00 Contract Wages & Consulting 6,420.00 4,249.61 Faxes 45.75 30.00 Legal Fees 3,814.03 773.87 Director Fees 750.00 1,350.00 Office Supplies 124.24 366.71 Printing 116.50 119.00 Postage 97.00 416.00 Supplies 202.84 36.20 Telephone 28.29 48.01 Rent 750.00 750.00 ------------- ------------- TOTAL EXPENSES 15,108.16 10,538.40 ------------- ------------- INCOME(LOSS)BEFORE INCOME TAXES (3,430.29) 162,354.33 INCOME TAXES 0.00 0.00 ------------- ------------- NET INCOME (LOSS) $ (3,430.29) $ 162,354.33 ============= ============= INCOME PER SHARE (Basic & Diluted) $ .00 $ .06 ============= ============= WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 2,640,000 2,640,000 ============= ============= 2 WORLD SERVICES, INC. STATEMENTS OF OPERATIONS For the Nine Months ended September 30, 1999 and 1998 1999 1998 ---- ---- REVENUE Dividend Income $ 79,695.20 $ 318,780.80 Interest Income 40,288.30 29,961.37 ------------- ------------- TOTAL REVENUE 119,983.50 348,742.17 ------------- ------------- EXPENSES Accounting Fees 11,679.01 11,548.94 Contract Wages & Consulting 20,065.00 30,052.71 Faxes 296.25 153.00 Legal Fees 5,851.83 12,370.84 Director Fees 3,150.00 3,450.00 Office Supplies 140.20 767.99 Miscellaneous 0.00 308.00 Printing 925.50 664.00 Postage 2,565.89 2,176.45 Supplies 338.64 274.52 Telephone 77.32 204.48 Rent 2,250.00 2,000.00 Annual Meeting 2,913.26 0.00 Loss on Uncollect. Note 0.00 4,000.00 ------------- ------------- TOTAL EXPENSES 50,252.90 67,970.93 ------------- ------------- INCOME BEFORE INCOME TAXES 69,730.60 280,771.24 INCOME TAXES 0.00 0.00 ------------- ------------- NET INCOME $ 69,730.60 $ 280,771.24 ============= ============= INCOME PER SHARE (Basic & Diluted) $ .03 $ .11 ============= ============= WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 2,640,000 2,640,000 ============= ============= 3 WORLD SERVICES, INC. STATEMENTS OF CASH FLOWS For the Nine Months Ended September 30, 1999 and 1998 1999 1998 ---- ---- CASH FLOWS FROM OPERATING ACTIVITIES Net Income $ 69,730.60 $ 280,771.24 Adjustment to reconcile net income to net cash provided by operating activities: (Increase) Decrease in: Interest Receivable (12,869.08) 5,636.46 Other Assets 0.00 (15,899.15) Increase (Decrease) in: Accounts Payable (5,500.00) 0.00 Stock Redemption Payable (2,058.50) (6,739.50) ----------- ------------ NET CASH PROVIDED BY OPERATING ACTIVITIES 49,303.02 263,769.05 ----------- ------------ CASH FLOWS FROM INVESTING ACTIVITIES Purchase of Certificates of Deposit (71,246.58) (240,000.00) ----------- ------------ NET CASH USED BY INVESTING ACTIVITIES (71,246.58) (240,000.00) ----------- ------------ NET INCREASE(DECREASE)IN CASH (21,943.56) 23,769.05 CASH AT BEGINNING OF PERIOD 48,313.64 65,451.44 ----------- ------------ CASH AT END OF PERIOD $ 26,370.08 $ 89,220.49 =========== ============ SUPPLEMENTAL DISCLOSURES Cash payments for: Income taxes $ 0.00 $ 0.00 =========== ============ Interest paid $ 0.00 $ 0.00 =========== ============ 4 WORLD SERVICES, INC. NOTES TO FINANCIAL STATEMENTS FOR THE PERIOD ENDED SEPTEMBER 30, 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 September 30, 1999, and the results of operations and cash flows for the nine months ended September 30, 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. 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 - SEPTEMBER 30, 1999, COMPARED TO DECEMBER 31, 1998 - -------------------------------------------------------------------------------- During the nine months ended September 30, 1999, cash decreased approximately $21,900, as a result of purchasing certificates of deposits which are now held by the Company. Interest receivable increased from $18,579 at December 31, 1998, to $31,448 at September 30, 1999. Primarily as a result of the increase in operating income, current assets increased by $62,172, from $1,089,942 at December 31, 1998, to $1,152,114 at September 30, 1999. Current liabilities decreased $7,558 from $55,388 at December 31, 1998, to $47,830 at September 30, 1999. The decrease is the result of payments made on stock redemption payable and accounts payable. As a result of the Company's net income for the nine months of $69,731, the accumulated deficit decreased from $4,764,516 at December 31, 1998, to $4,694,785 at September 30, 1999. As a result, total stockholders equity increased from 1,602,554 at December 31, 1998, to $1,672,284 at September 30, 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 September 30, 1999. As a result, the 'current liabilities' portion of the balance sheet reflects a "stock redemption payable." During the nine months ended September 30, 1999, the Company redeemed outstanding fractional shares with a value of approximately $2,059. 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) The company has sufficient funds available to meet its capital obligations in the foreseeable future. As noted, elsewhere in this report and in the Company's annual report on Form 10-KSB for the year ended December 31, 1998, the future conduct of World Services' business is dependent upon a number of factors, and there can be no assurance that World Services will be able to conduct its operations as contemplated herein. Certain statements contained in this report, such as the possibility that World Services may acquire an operating business or, if any such business is acquired that it can be successfully operated, are forward-looking statements. The accuracy of these statements cannot be guaranteed as they are subject to a variety of risks including, but not limited to: the possibility that World Services will not be able to complete any such acquisition on economic terms, if at all; and if such an acquisition does occur, the possibility that World Services will not be able to operate the business successfully. Furthermore, if any acquisition does occur, it will likely be accompanied by a change of control, and there can be no assurance that such change of control will be beneficial to World Services or its existing shareholders. RESULTS OF OPERATIONS - NINE MONTHS ENDED SEPTEMBER 30, 1999 COMPARED TO THE NINE MONTHS ENDED SEPTEMBER 30, 1998 - -------------------------------------------------------------------------------- Nine months ended September 30, September 30, 1999 1998 ------------- ------------- Net income $ 119,984 $ 348,742 Operating Expenses 50,253 67,971 Weighted Average Number of Shares 2,640,000* 2,640,000* Net income per share $ 0.03 $ 0.11 7 WORLD SERVICES, INC. MANAGEMENTS'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) * 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 in August of 1997. No major changes in income or expenses are anticipated for the rest of the year. Y2K COMPLIANCE - -------------------------------------------------------------------------------- The Failure of Systems and Equipment on which we depend to be 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 banks where we have deposits or the company (S8MD) 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 completed the process or verification of whether banks and S8MD with which we have material relationships are Year 2000 compliant. The process of verification included 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. 8 WORLD SERVICES, INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued) 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. 9 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 - -------------------------------------------------------------------------------- On June 24, 1999, the Company held a special meeting of its shareholders in lieu of an annual meeting. At that meeting, the following nominees were reelected to the Board of Directors: Ronne Tarrell, Delores Bower, David Jorgenson, Delbert Harty, and Terry Heinz. No other matters were considered at the special meeting. ITEM 5. - OTHER INFORMATION - -------------------------------------------------------------------------------- None. ITEM 6. - EXHIBITS - -------------------------------------------------------------------------------- Exhibit 27 - Financial Data Schedule. 10 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. October 18, 1999 WORLD SERVICES, INC. By: /s/ Ronne Tarrell --------------------- Ronne Tarrell, President, Chief Executive Officer and Principal Financial Officer 11 EX-27 2 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM SEPTEMBER 30, 1999 FINANCIAL STATEMENTS OF WORLD SERVICES, INC. AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 9-MOS DEC-31-1999 JAN-01-1999 SEP-30-1999 1,120,666 0 31,448 0 0 1,152,114 0 0 1,720,114 47,830 0 0 0 2,715 1,669,569 1,720,114 0 11,678 0 0 15,108 0 0 (3,430) 0 0 0 0 0 (3,430) .000 .000
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