-----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, BzAT9lbbxsu4WGupuPbKWUr4d1WGs5OL50ojUu9igosXZptQNC2ixwUFCLenZuMR 4FVoWg310GChVY7lkk4/ow== 0000949459-96-000186.txt : 19961018 0000949459-96-000186.hdr.sgml : 19961018 ACCESSION NUMBER: 0000949459-96-000186 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960831 FILED AS OF DATE: 19961017 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: HALDANE BERNARD ASSOCIATES INC CENTRAL INDEX KEY: 0000801557 STANDARD INDUSTRIAL CLASSIFICATION: PATENT OWNERS & LESSORS [6794] IRS NUMBER: 592720407 STATE OF INCORPORATION: FL FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-18097 FILM NUMBER: 96644593 BUSINESS ADDRESS: STREET 1: 192 LEXINGTON AVENUE STREET 2: 15TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10016 BUSINESS PHONE: 2126793360 MAIL ADDRESS: STREET 1: 2600 N MILIARY TRAIL STREET 2: SUITE 270 CITY: BOCA RATON STATE: FL ZIP: 33431 FORMER COMPANY: FORMER CONFORMED NAME: QUANTUM VENTURES GROUP INC DATE OF NAME CHANGE: 19920703 10QSB 1 BERNARD HALDANE ASSOCIATES, INC. 10-QSB Securities and Exchange Commission Washington D.C. 20549 Form 10-QSB [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended August 31, 1996 --------------- [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT For the transition period from to ----------------- ------------------- Commission file number 000-18097 ----------------------------------------------- BERNARD HALDANE ASSOCIATES, INC. - -------------------------------------------------------------------------------- (Exact name of small business issuer as specified in its charter) Florida 59-2720407 ------------------------------ ----------------- (State of other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 2600 North Military Trail, Suite 270, Boca Raton, Florida 33431 - -------------------------------------------------------------------------------- (address of principal executive offices) (407) 997-4050 - -------------------------------------------------------------------------------- (Issuer's telephone number) Not Applicable - -------------------------------------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) 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 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: August 31, 1996 --------------- Class Outstanding at August 31, 1996 ------------------------------- ------------------------------ Common Stock, $.00001 Par Value 1,148,865 shares Page 1 of 9 BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES INDEX PAGE ---- PART I. FINANCIAL INFORMATION Consolidated Balance Sheets as of August 31, 1996 (Unaudited) and May 31, 1996 3 - 4 Consolidated Statements of Income for the Three Months Ended August 31, 1996 and 1995 (Unaudited) 5 Consolidated Statements of Cash Flows for the Three Months Ended August 31, 1996 and 1995 (Unaudited) 6 Notes to Consolidated Financial Statements as of August 31, 1996 7 Management's Discussion and Analysis of Financial Condition and Results of Operations 8 - 9 PART II. OTHER INFORMATION AND SIGNATURES Signatures 10 BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS ASSETS AUGUST 31, MAY 31, 1996 1996* ---------- ---------- (Unaudited) CURRENT ASSETS: Cash and cash equivalents $1,671,830 $1,559,116 Short-term investments 53,716 53,146 Accounts receivable - net of allowance for doubtful accounts of $200,000 and $170,000, respectively 291,348 329,146 Notes receivable 42,762 48,478 Due from related parties 95,635 28,039 Prepaid expenses and miscellaneous receivables 15,181 9,734 Deferred taxes 95,000 83,000 Net assets of discontinued operations 34,394 36,635 ---------- ---------- Total current assets 2,299,866 2,147,294 ---------- ---------- OTHER ASSETS: Licenses - net of accumulated amortization of $1,509,761 and $1,460,376, respectively 1,012,767 1,062,152 Equipment, fixtures and leasehold improvements - net of accumulated depreciation of $20,086 and $19,549, respectively 19,494 20,031 Security deposits and other 60,460 60,460 Notes receivable 150,211 134,893 ---------- ---------- Total other assets 1,242,932 1,277,536 ---------- ---------- TOTAL ASSETS $3,542,798 $3,424,830 ========== ========== *The balance sheet at May 31, 1996 is derived from the audited financial statements of that date. -3- BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS LIABILITIES AND STOCKHOLDERS' EQUITY AUGUST 31, MAY 31, 1996 1996* ---------- --------- (Unaudited) CURRENT LIABILITIES: Cash overdraft $ -- $ 18,044 Current maturities of long-term debt 239,778 245,956 Accounts payable 42,250 56,968 Accrued expenses and other current liabilities 61,604 12,778 Income taxes payable 86,905 61,905 ---------- ---------- Total current liabilities 430,537 395,651 ---------- ---------- OTHER LIABILITIES: Long-term debt 530,519 541,080 Deferred rent payable 14,719 14,719 ---------- ---------- 545,238 555,799 Total liabilities 975,775 951,450 ---------- ---------- STOCKHOLDERS' EQUITY: Common stock ($.00001 par value; 950,000,000 shares authorized, 1,148,865 shares issued and outstanding) 12 12 Additional paid-in capital 2,761,727 2,761,727 Retained earnings 311,722 162,964 ---------- ---------- 3,073,461 2,924,703 Less: Treasury stock (199,500 and 179,500 shares at cost) 506,438 451,323 ---------- ---------- Total stockholders' equity 2,567,023 2,473,380 ---------- ---------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $3,542,798 $3,424,830 ========== ========== *The balance sheet at May 31, 1996 is derived from the audited financial statements of that date. -4- BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) FOR THE THREE MONTHS ENDED AUGUST 31, 1996 1995 ----------- ----------- (Restated) REVENUES: Royalty income $ 582,175 $ 560,620 Interest, dividends and other income 24,088 23,317 Sub-license income 43,718 -- ----------- ----------- Total revenues 649,981 583,937 ----------- ----------- EXPENSES: Payroll and related costs 84,810 84,773 Other general and administrative 235,528 209,866 Amortization 49,385 49,385 Interest 15,259 17,012 ----------- ----------- Total expenses 384,982 361,036 ----------- ----------- INCOME BEFORE PROVISION FOR INCOME TAXES 264,999 222,901 PROVISION FOR INCOME TAXES 106,000 85,000 ----------- ----------- INCOME FROM CONTINUING OPERATIONS 158,999 137,901 DISCONTINUED OPERATIONS: Loss from operations of travel agency to be disposed of 10,241 10,131 ----------- ----------- NET INCOME $ 148,758 $ 127,770 =========== =========== NET EARNINGS PER COMMON AND COMMON EQUIVALENT SHARE: Continuing operations $ .16 $ .11 Discontinued operations (.01) (.01) ----------- ----------- $ .15 $ .10 =========== =========== WEIGHTED AVERAGE NUMBER OF COMMON AND COMMON EQUIVALENT SHARES 1,022,222 1,245,092 =========== =========== DIVIDENDS None None ==== ==== -5- BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE THREE MONTHS ENDED AUGUST 31, 1996 1995 ---------- ----------- (Restated) CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 148,758 $ 127,770 Loss from discontinued operations 10,241 10,131 Adjustments to reconcile net income to net cash provided by operating activities: Expenses (income) not requiring the use of cash: Provision for losses on accounts receivable 30,000 -- Depreciation 537 -- Amortization of licenses 49,385 49,385 Interest expense - imputed 11,261 13,012 Interest income - imputed (550) (1,775) Deferred income taxes (12,000) 72,000 Changes in assets and liabilities: Accounts receivable 7,798 (49,131) Prepaid expenses (5,447) (20,884) Cash overdraft (18,044) -- Accounts payable and other current liabilities 34,108 5,857 Income taxes payable 25,000 (61,384) Net assets of discontinued operations 185,697 81,227 ----------- ----------- NET CASH PROVIDED BY OPERATING ACTIVITIES 466,744 226,208 ----------- ----------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of short-term investments (570) (51,643) Redemption of short-term investments -- 151,008 (Increase) decrease in due from related parties (67,596) 67,000 Acquisition of fixed assets -- (17,880) Addition to notes receivable (17,718) -- Payments of notes receivable 8,666 16,138 ----------- ----------- NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES (77,218) 164,623 ----------- ----------- CASH FLOWS FROM FINANCING ACTIVITIES: Principal payments on debt (28,000) (42,000) Repurchase of common stock (55,115) -- ----------- ----------- NET CASH USED IN FINANCING ACTIVITIES (83,115) (42,000) ----------- ----------- NET CHANGE IN CASH AND CASH EQUIVALENTS 306,411 348,831 CASH AND CASH EQUIVALENTS - beginning 1,615,073 835,008 ----------- ----------- CASH AND CASH EQUIVALENTS - ending (includes cash of discontinued operations of $249,654 and $159,499, respectively) $ 1,921,484 $ 1,183,839 =========== =========== SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the period for: Interest $ 15,260 $ 17,012 Income taxes 101,000 87,200
-6- BERNARD HALDANE ASSOCIATES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AUGUST 31, 1996 (UNAUDITED) The accompanying interim consolidated financial statements are unaudited and include the accounts of Bernard Haldane Associates, Inc. ("Haldane") and its subsidiaries. NOTE 1 In the opinion of management, the accompanying interim consolidated financial statements contain all material and significant adjusting and eliminating entries consisting only of normal recurring adjustments and eliminations necessary to present fairly the financial condition as of August 31, 1996 and the results of operations and cash flows for the three months ended August 31, 1996. The results of operations for the three month period ended August 31, 1996 are not necessarily indicative of the results of operations for the year ended May 31, 1997. NOTE 2 The Company utilizes Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes," to record income taxes. The component of the deferred tax asset is the allowance for doubtful accounts. NOTE 3 For the three months ended August 31, the calculation of net earnings per share, using the modified treasury stock method, is as follows: 1996 1995 ---------- ---------- Net income $ 148,758 $ 127,770 Incremental income -- 2,126 ---------- ---------- Total income $ 148,758 $ 129,986 ========== ========== Weighted average shares outstanding 954,365 1,148,865 Incremental shares 67,857 96,227 ---------- ---------- Total shares 1,022,222 1,245,092 ========== ========== Net earnings per share $ .15 $ .10 ========== ========== NOTE 4 On May 31, 1996, the Company adopted a plan to terminate its travel agency operations. The anticipated disposal date is November 1996. The operating results of the travel agency segment for the three months ended August 31, 1996 are shown separately in the accompanying consolidated income statement. The 1995 consolidated statements of income and cash flows have been restated to segregate the operating results of the travel agency segment. Net revenues of the travel agency segment for the three months ended August 31, 1996 and 1995 amounted to $2,838 and $9,863, respectively, and are not included in consolidated revenues. -7- BERNARD HALDANE ASSOCIATES, INC. ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED AUGUST 31, 1996 AND 1995 Royalty revenue from licensee offices increased only 3.8%, increasing from $560,620 to $582,175 for the three months ended August 31, 1996 as compared to the comparable three month period in the prior year. Although the number of Haldane offices increased over the prior comparable period and the Company recognized $43,718 in sub-license income, gross royalty revenue per office declined . This decline is due in part to the fact that Haldane offices continue to open in smaller metropolitan offices where the average gross royalty payable to the Company is less than the average gross royalty received from larger metropolitan areas. However, management remains optimistic that gross royalty revenue will continue to increase as the number of Haldane offices continues to increase. Interest income during this period remained relatively constant, increasing from $23,317 to $24,088. Total expenses for the three month period increased from $361,036 to $384,982 due almost exclusively to an increase in general and administrative expenses from $209,866 TO $235,528. These costs reflect increasing costs in administering and managing the growing network of Haldane offices. Net income before taxes increased by more than 18% as compared to the prior period, increasing from $222,901 to $264,999 resulting in net income after taxes of $148,758 as compared to $127,770 in the prior period. Although no assurances can be given, management remains optimistic that the Company will continue to operate profitably in the coming quarter. -8- LIQUIDITY AND CAPITAL RESOURCES August 31, 1996 as compared to August 31, 1995 Total cash, cash equivalents and short term investments as of August 31, 1996 were $1,725,546 as compared to $1,612,262 on May 31, 1996, an increase of more than $110,000. Total current assets increased from $2,147,294 to $2,299,866 and the Company's total assets increased from $3,424,830 to $3,542,830. Current liabilities increased from $395,651 to $430,537 as of August 31, 1996. Total liabilities increased from $951,450 as of May 31, 1996 to $975,775 as of August 31, 1996. The increase in liabilities is attributable to revenues collected by Quantum Tours for upcoming tours which has been reported on the balance sheet as unearned income. Management believes that the Company has sufficient revenues and reserves to finance ongoing business activities. -9- 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. BERNARD HALDANE ASSOCIATES, INC. By:/s/ Jerold Weinger -------------------------------- JEROLD WEINGER PRESIDENT/TREASURER DATED: 10/15/96 --------- EX-27 2 EXHIBIT 27.1 FINANCIAL DATA SCHEDULE
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL STATEMENTS OF BERNARD HALDANE ASSOCIATES, INC. FOR THE THREE MONTHS ENDED AUGUST 31, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 1 3-MOS MAY-31-1997 JUN-01-1996 AUG-31-1996 1,671,830 53,716 491,348 200,000 0 2,299,866 39,580 19,494 3,542,798 430,537 0 0 0 12 2,567,011 3,542,798 0 649,981 0 0 369,723 0 15,259 264,999 106,000 158,999 10,241 0 0 148,758 .15 .15
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