-----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, SsPukhy+Arx0jDTK/Y+yWLDHhjjX8x6VSWxoXT5VQWjcG4k4LHNDqPhUPdTHQ1gO 17lwesdwldc0wRRL/dhu5g== 0000789318-99-000005.txt : 19990818 0000789318-99-000005.hdr.sgml : 19990818 ACCESSION NUMBER: 0000789318-99-000005 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990630 FILED AS OF DATE: 19990816 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CLANCY SYSTEMS INTERNATIONAL INC /CO/ CENTRAL INDEX KEY: 0000789318 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 841027964 STATE OF INCORPORATION: CO FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 033-04882-D FILM NUMBER: 99694051 BUSINESS ADDRESS: STREET 1: 2250 S ONEIDA STREET 2: STE 308 CITY: DENVER STATE: CO ZIP: 80224 BUSINESS PHONE: 3037530197 MAIL ADDRESS: STREET 1: 2250 S ONEIDA STREET 2: STE 3308 CITY: DENVER STATE: CO ZIP: 80224 FORMER COMPANY: FORMER CONFORMED NAME: OXFORD FINANCIAL INC DATE OF NAME CHANGE: 19600201 10QSB 1 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 June 30, 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: 33-4882-D CLANCY SYSTEMS INTERNATIONAL, INC. (Exact name of Registrant as specified in its charter) Colorado 84-1027964 (State or other jurisdiction of (IRS Employer Identification incorporation or organization) Number) 2250 S. Oneida #308, Denver, Colorado 80224 (Address of principal executive offices and Zip Code) (303) 753-0197 (Registrant's telephone number) 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 requiredto 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 APPLICABLE ONLY TO CORPORATE ISSUERS: The number of shares outstanding of the issuer's classes of common stock, as of August 13, 1999 is 336,889,149 shares, $.0001 par value. CLANCY SYSTEMS INTERNATIONAL, INC. INDEX Page No. PART I. FINANCIAL INFORMATION Balance Sheet - September 30, 1998 and June 30, 1999 (unaudited) 2 and 3 Statement of Operations - For the Three Months Ended June 30, 1998 and 1999 (unaudited) 4 Statement of Operations - For the Nine Months Ended June 30, 1998 and 1999 (unaudited) 5 Statement of Stockholders' Equity - For the Nine Months Ended June 30, 1999 (unaudited) 6 Statement of Cash Flows - For the Nine Months Ended June 30, 1998 and 1999 (unaudited) 7 Notes to Unaudited Financial Statements 8 Management's Discussion and Analysis of Financial Condition and Results of Operations 10 PART II. OTHER INFORMATION 10 1 CLANCY SYSTEMS INTERNATIONAL, INC. BALANCE SHEET September 30, 1998 and June 30, 1999 (Unaudited) ASSETS September June --------- ---- Current assets: Cash and cash equivalents $ 91,432 $ 200,603 Accounts receivable 244,448 392,166 Inventories (Note 2) 190,960 184,791 Investment in contract, n 23,334 - Income taxes refundable 16,000 - ---------- ---------- Total current assets 566,174 777,560 Furniture and equipment, at cost: Office furniture and equipment 235,180 235,180 Equipment under service contracts 1,442,295 1,534,084 ---------- ---------- 1,677,475 1,769,264 Less accumulated depreciation 1,204,775 1,345,422 ---------- ---------- Net furniture and equipment 472,700 423,842 Other assets: Investment in partnership 329,915 435,535 Deposits and other 28,310 28,310 Deferred tax asset (Note 3) 5,000 - Software licenses 16,882 - Software development costs 356,353 388,424 ---------- ---------- 736,460 852,269 Less accumulated amortization 225,040 251,335 ---------- ---------- Net other assets 511,420 600,934 ---------- ---------- $1,550,294 $1,802,336 ========== ========== See accompanying notes. 2 CLANCY SYSTEMS INTERNATIONAL, INC. BALANCE SHEET September 30, 1998 and June 30, 1999 (Unaudited) LIABILITIES AND STOCKHOLDERS' EQUITY September June --------- ---- Current liabilities: Accounts payable $ 37,999 $ - Note payable - bank - 295,000 Notes payable - related party (Note 4) - 120,000 Income taxes payable - 33,000 Deferred revenue 87,971 134,843 ---------- --------- Total current liabilities 125,970 582,843 Long-term note payable - bank 320,000 - Stockholders' equity: Preferred stock, $.0001 par value; 100,000,000 shares authorized, none issued - - Common stock, $.0001 par value; 800,000,000 shares authorized, 336,889,149 shares issued and outstanding 33,689 33,689 Additional paid-in capital 1,030,674 1,030,674 Retained earnings 39,961 155,130 ---------- ---------- Total stockholders' equity 1,104,324 1,219,493 ---------- ---------- $1,550,294 $1,802,336 ========== ========== See accompanying notes. 3 CLANCY SYSTEMS INTERNATIONAL, INC. STATEMENT OF OPERATIONS For the Three Months Ended June 30, 1998 and 1999 (Unaudited) 1998 1999 ---- ---- Revenues: Sales $ 36,416 $ 49,331 Service contract income 304,995 268,980 Parking ticket collections 64,777 216,978 ---------- ---------- Total revenues 406,188 535,289 Costs and expenses: Cost of sales 12,828 38,668 Cost of services 119,404 168,638 Cost of parking ticket collections 49,189 70,041 General and administrative 94,720 158,309 Research and development 11,509 14,443 ---------- ---------- Total costs and expenses 287,650 450,099 ---------- ---------- Income from operations 118,538 85,190 Other income (expense): Interest income 678 565 Interest expense - (10,108) ---------- ---------- Total other income (expense) 678 (9,543) ---------- ---------- Income before provision for income taxes 119,216 75,647 Provision for income taxes (35,000) (19,000) Income in equity basis partnership (net of $4,200 tax provision) - 7,300 ----------- ---------- Net income $ 84,216 $ 63,947 =========== ========== Basic net income per common share $ * $ * =========== =========== Weighted average number of shares outstanding 336,900,000 336,900,000 =========== =========== * Less than $.01 per share See accompanying notes. 4 CLANCY SYSTEMS INTERNATIONAL, INC. STATEMENT OF OPERATIONS For the Nine Months Ended June 30, 1998 and 1999 (Unaudited) 1998 1999 ---- ---- Revenues: Sales $ 178,887 $ 196,323 Service contract income 813,821 843,621 Parking ticket collections 129,227 380,308 ----------- ---------- Total revenues 1,121,935 1,420,252 Costs and expenses: Cost of sales 102,225 77,242 Cost of services 404,186 441,397 Cost of parking ticket collections 98,738 231,310 General and administrative 336,387 409,847 Research and development 37,024 37,816 ----------- ---------- Total costs and expenses 978,560 1,197,612 ----------- ---------- Income from operations 143,375 222,640 Other income (expense): Interest income 5,950 1,525 Interest expense (8,507) (25,116) ----------- ---------- Total other income (expense) (2,557) (23,591) ----------- ---------- Income before provision for income taxes 140,818 199,049 Provision for income taxes (42,831) (63,500) Loss in equity basis partnership (net of tax benefit of $9,500) - (20,380) ----------- ---------- Net income $ 97,987 $ 115,169 =========== ========== Basic net income per common share $ * $ * =========== =========== Weighted average number of shares outstanding 336,900,000 336,900,000 =========== =========== * Less than $.01 per share See accompanying ntoes. 5 CLANCY SYSTEMS INTERNATIONAL, INC. STATEMENT OF STOCKHOLDERS' EQUITY For the Nine Months Ended June 30, 1999 (Unaudited)
Additional Common stock paid-in Retained Shares Amount capital earnings ------ ------ ---------- -------- Balance, September 30, 1998 336,889,149 $33,689 $1,030,674 $ 39,961 Net income for the nine months ended June 30, 1999 - - - 115,169 ----------- ------- ---------- -------- Balance, June 30, 1999 336,889,149 $33,689 $1,030,674 $155,130 =========== ======= ========== ========
See accompanying notes. 6 CLANCY SYSTEMS INTERNATIONAL, INC. STATEMENT OF CASH FLOWS For the Nine Months Ended June 30, 1998 and 1999 (Unaudited) 1998 1999 ---- ---- Cash flows from operating activities: Net income $ 97,987 $115,169 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 186,631 207,158 Decrease in deferred tax asset 3,000 5,000 Increase in accounts receivable (82,563) (147,718) Decrease in inventories 22,116 6,169 Increase in prepaid expense (32,084) - Loss in equity basis partnership - 29,880 Decrease in accounts payable - (37,999) Decrease in accrued expenses (2,286) - Decrease in income taxes refundable - 16,000 Increase in income taxes payable 39,000 33,000 Increase (decrease) in deferred revenue (29,898) 46,872 Decrease in warranty reserve (400) - -------- -------- Total adjustments 103,516 158,362 -------- -------- Net cash provided by operating activities 201,503 273,531 Cash flows from investing activities: Acquisition of furniture and equipment - net (185,466) (91,789) Increase in software development costs (48,474) (32,071) Investment in partnership - (135,500) Increase in deposits and other assets (76,475) - -------- -------- Net cash used in investing activities (310,415) (259,360) Cash flows from financing activities: Proceeds from note payable - bank 100,000 - Proceeds from notes payable - related party - 120,000 Payments on note payable - bank - (25,000) -------- -------- Net cash provided by financing activities 100,000 95,000 -------- -------- Increase (decrease) in cash and cash equivalents (8,912) 109,171 Cash and cash equivalents at beginning of period 199,195 91,432 -------- -------- Cash and cash equivalents at end of period $190,283 $200,603 ======== ======== See accompanying notes. 7 CLANCY SYSTEMS INTERNATIONAL, INC. NOTES TO UNAUDITED FINANCIAL STATEMENTS June 30, 1999 1. Basis of presentation The accompanying financial statements have been prepared by the Company, without audit. In the opinion of management, the accompanying unaudited financial statements contain all adjustments (consisting of only normal recurring accruals) necessary for a fair presentation of the financial position as of September 30, 1998 and June 30, 1999, and the results of operations and cash flows for the periods ended June 30, 1998 and 1999. 2. Inventories Inventories consist of the following at: September 30, June 30, 1998 1999 ---- ---- Finished goods $ 19,690 $ 9,240 Work in process - 46,198 Purchased parts and supplies 171,270 129,353 -------- ------- $190,960 $184,791 ======== ======== 3. Income taxes The provision for income taxes for the three months and nine months ended June 30, 1998 and 1999 is based on the expected tax rate for the year. As of September 30, 1998 and June 30, 1999, total deferred tax assets and liabilities are as follows: September 30, June 30, 1998 1999 ---- ---- Deferred tax assets $10,000 $ - Deferred tax liabilities (5,000) - ------- -------- $ 5,000 $ - ======= ======== 4. Notes payable - related party On October 1, 1998, the Company executed a one-year note payable for $25,000 with an officer of the Company. The note is unsecured, bears interest at 8%, and is due on October 1, 1999. On December 1, 1998, the Company executed a one-year note payable for $30,000 with an officer of the Company. The note is unsecured, bears interest at 8%, and is due on December 1, 1999. 8 CLANCY SYSTEMS INTERNATIONAL, INC. NOTES TO UNAUDITED FINANCIAL STATEMENTS June 30, 1999 4. Notes payable - related party (continued) On January 1, 1999, the Company executed a one-year note payable for $20,000 with an officer of the Company. The note is unsecured, bears interest at 9%, and is due on January 1, 2000. On February 1, 1999, the Company executed a one-year note payable for $20,000 with an officer of the Company. The note is unsecured, bears interest at 9%, and is due on February 1, 2000. On March 1, 1999, the Company executed a one-year note payable for $25,000 with an officer of the Company. The note is unsecured, bears interest at 9%, and is due on March 1, 2000. 9 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Material Changes in Financial Condition At June 30, 1999 the Company had working capital of $194,717 derived primarily from contract sales, as compared to working capital of $440,204 at September 30, 1998. The Company anticipates that working capital will be sufficient to meet its working capital requirements for the current year. Funds will continue to be used for general and administrative purposes, equipment purchases, equipment manufacturing, travel, marketing and research and development. Material Changes in Results of Operations During the quarter ended June 30, 1999 the Company generated revenues from contract sales from its professional services contracts, sales, and privatization contracts. Berkeley, CA and Oklahoma City, OK each generated revenues in excess of 5% of total revenues. New clients added during the quarter include Longview, WA; Allright, Buffalo, NY and Allright, Rochester, NY. Revenues for the nine-month period ended June 30, 1999 were 27% higher than the same period in the prior year. Expenses for the nine-month period ended June 30, 1999 were 22% higher than the same period in the prior year. The increases in both revenue and expenses were mainly attributable to the addition of new service contracts during the period. The Company reported a net profit of $115,169 for the nine-month period ended June 30, 1999 as compared to a profit of $97,987 for the same period in the prior year. During the fiscal year ended September 30, 1998, the Company upgraded substantially all of its clients to its new year 2000 compliant software and hardware. Costs associated with the software portion of the year 2000 upgrade have been insignificant because the Company is continually upgrading and improving its software for its clients as a normal course of business. Management estimates costs associated with completing replacement of hardware to approximate $65,000 during fiscal year 1999. Robert Brodbeck resigned his positions as Director and Chairman of the Board of the Company effective June 25, 1999. PART II - OTHER INFORMATION Item 1. Legal Proceedings None. Item 6. Exhibits and Reports on Form 8-K (a) Exhibits 27.1 Financial Data Schedule (1) (b) During the quarter ended June 30, 1999, the Registrant has filed no reports on Form 8-K (1) Filed herewith 10 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. Date: August 16, 1999 CLANCY SYSTEMS INTERNATIONAL, INC. (Registrant) By: /s/ Stanley J. Wolfson Stanley J. Wolfson, President and Chief Executive Officer 11 EX-27 2 FDS699
5 This schedule contains summary financial information extracted from form 10QSB statements for period ended 6/30/99 and is qualified in its entirety by reference to such form 10QSB for period ended 6/30/99 9-MOS SEP-30-1999 JUN-30-1999 200,603 0 392,166 0 184,791 777,560 1,769,264 1,345,422 1,802,336 582,843 0 0 0 33,689 1,185,804 1,802,336 196,323 1,420,252 77,242 749,949 447,663 0 25,116 199,049 69,500 115,169 0 0 0 115,169 0 0
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