-----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, PIDiemHqjPVLnfVnsbvXnJZDcdm0utPogjYzJ6Rq9rNhpsvqAVGbm7i3K3iWnqzY vpslK9LNU8JzLcyQIEHdLA== 0001016193-98-000012.txt : 19980218 0001016193-98-000012.hdr.sgml : 19980218 ACCESSION NUMBER: 0001016193-98-000012 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19971130 FILED AS OF DATE: 19980217 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: TUFCO INTERNATIONAL INC CENTRAL INDEX KEY: 0000808714 STANDARD INDUSTRIAL CLASSIFICATION: CARPETS AND RUGS [2273] IRS NUMBER: 954071623 STATE OF INCORPORATION: NV FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 10QSB SEC ACT: SEC FILE NUMBER: 033-10984-LA FILM NUMBER: 98540303 BUSINESS ADDRESS: STREET 1: PIONEER LANE STREET 2: P O BOX 457 CITY: GENTRY STATE: AR ZIP: 72734 BUSINESS PHONE: 5017362201 MAIL ADDRESS: STREET 1: 12575 PIONEER LANE STREET 2: 12575 PIONEER LANE CITY: GENTRY STATE: AK ZIP: 72734 FORMER COMPANY: FORMER CONFORMED NAME: COASTECH INC DATE OF NAME CHANGE: 19900912 10QSB 1 U.S. 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 quarter ended November 30, 1997 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 33-10984-LA ------------ TUFCO INTERNATIONAL, INC. (Name of Small Business Issuer as specified in its charter) Nevada 95-4071623 ----------------------- ------------------- (State or other jurisdiction of (I.R.S. employer incorporation or organization identification No.) Pioneer Lane, Gentry, AR 72734 (Address of principal executive offices) Registrant's telephone no., including area code: (501) 736-2201 No Change Former name, former address, and former fiscal year, if changed since last report. Securities registered pursuant to Section 12(b) of the Exchange Act: None Securities registered pursuant to Section 12(g) of the Exchange Act: None Check whether the Issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 ___. Common Stock outstanding at January 20, 1998 - 6,965,800 shares of $.001 par value Common Stock. DOCUMENTS INCORPORATED BY REFERENCE: NONE 1 FORM 10-QSB FINANCIAL STATEMENTS AND SCHEDULES TUFCO INTERNATIONAL, INC. For the Quarter Ended November 30, 1997. The following financial statements and schedules of the registrant and its consolidated subsidiaries are submitted herewith: PART I - FINANCIAL INFORMATION Page of Form 10-Q Item 1. Financial Statements: Condensed Consolidated Balance Sheet--November 30, 1997. 3 Condensed Consolidated Statements of Income for the three months and six months ended November 30, 1997 and 1996. 5 Condensed Consolidated Statements of Cash Flows--for the three months and six months ended November 30, 1997 and 1996. 6 Notes to Condensed Consolidated Financial Statements. 7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 8 PART II - OTHER INFORMATION Page Item 1. Legal Proceedings 11 Item 2. Changes in Securities 11 Item 3. Defaults Upon Senior Securities 11 Item 4. Submission of Matters to a Vote of Security Holders 11 Item 5. Other Information 11 Item 6(a).Exhibits 11 Item 6(b).Reports on Form 8-K 11 2 TUFCO INTERNATIONAL, INC. CONDENSED CONSOLIDATED BALANCE SHEET NOVEMBER 30, 1997 Unaudited ASSETS CURRENT ASSETS: Cash $ 30,748 Accounts and notes receivable, less allowance for doubtful accounts of $185,000 Trade 1,100,277 Affiliates 748,331 Inventories 507,785 Deferred income tax benefits 79,606 Other current assets 46,708 ------------------ 2,513,455 ------------------ Property and equipment 1,230,734 Accumulated depreciation 491,744 ------------------ 738,990 ------------------ Reacquired franchise territory 356,558 Accumulated amortization 260,788 ------------------ 95,770 ------------------ Other assets 4,190 ------------------ $ 3,352,405 ================== 3 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Current maturities of long-term debt $ 441,675 Trade accounts payable 1,466,473 Income taxes payable 32,257 Accrued expenses 82,793 ------------------ 2,023,198 ------------------ LONG-TERM DEBT 20,261 ------------------ DEFERRED INCOME TAXES 34,703 ------------------ COMMON STOCKHOLDERS' EQUITY: Common stock, $.001 par value; authorized 50,000,000 shares; issued and outstanding 6,965,800 shares 6,966 Retained earnings 1,097,429 Other common stockholders' equity 169,848 ------------------ 1,274,243 ------------------ $ 3,352,405 ================== 4 TUFCO INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME For the three months and six months ended November 30,1997 and 1996 Unaudited 1997 1996 ------------------------------------------------- 3 MONTHS 6 MONTHS 3 MONTHS 6 MONTHS ------------------------------------------------- NET SALES: Trade $ 1,066,269 $ 2,479,468 $ 1,422,916 $ 3,088,938 Affiliates 379,005 703,788 494,930 824,380 -------------------------------------------------- 1,445,274 3,183,256 1,917,846 3,913,318 -------------------------------------------------- Cost of sales 1,030,778 2,228,357 1,353,002 2,790,808 Selling expenses 116,233 217,704 191,831 413,538 General and administrative expenses 286,846 585,091 294,144 604,293 Bad debts 8,453 8,453 Other income (28,885) (58,356) (13,151) (40,588) -------------------------------------------------- 1,413,425 2,981,249 1,825,826 3,768,051 -------------------------------------------------- Income before taxes 31,849 202,007 92,020 145,267 -------------------------------------------------- Provision for income taxes Current (14,998) 48,009 43,132 68,292 Deferred 27,231 28,359 (581) 3,817 -------------------------------------------------- 12,233 76,368 42,551 72,109 -------------------------------------------------- Net Income $ 19,616 $ 125,639 $ 49,469 $ 73,158 ================================================== EARNINGS PER SHARE: Net income $ 0.0028 $ 0.0180 $ 0.0063 $ 0.00941 ================================================== Weighted average number of shares outstanding 6,965,800 6,965,800 7,777,800 7,777,800 ================================================== 5 TUFCO INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS For the three months and six months ended November 30, 1997 and 1996 Unaudited 1997 1996 -------------------------------------------------- 3 MONTHS 6 MONTHS 3 MONTHS 6 MONTHS -------------------------------------------------- NET SALES PROVIDED BY (USED IN) Operating Activities $ 44,233 $ 37,546 $ (86,092) $ (19,920) -------------------------------------------------- CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of property 20,500 and equipment Proceeds from sale of reacquired 3,592 7,120 franchise territory Purchase of property and (2,458) (26,768) (58,609) (132,616) equipment -------------------------------------------------- Net cash provided by (used (2,458) (6,268) (55,017) (125,496) in) investing activities -------------------------------------------------- CASH FLOWS FROM FINANCING ACTIVITIES Principal payments on long-term debt (11,878) (21,927) (8,095) (17,743) Principal payments on short- (125,000) (125,000) term bank notes Proceeds from long-term debt 275,000 275,000 -------------------------------------------------- Net cash provided by (used (11,878) (21,927) 141,905 132,257 in) financing activities -------------------------------------------------- INCREASE (DECREASE) IN CASH 29,897 9,351 796 (13,159) CASH, BEGINNING OF PERIOD 851 12,397 651 14,606 -------------------------------------------------- CASH, END OF PERIOD $ 30,748 $ 30,748 $ 1,447 $ 1,447 ================================================== 6 TUFCO INTERNATIONAL, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Unaudited NOTE 1: BASIS OF PRESENTATION The accompanying condensed consolidated financial statements are presented in accordance with the requirements of Form 10-QSB and consequently do not include all of the disclosures normally required by generally accepted accounting principles for complete financial statements or those normally made in the Company's annual Form 10-KSB filing. Accordingly, the reader of these financial statements may wish to refer to the Company's financial statements for the year ended May 31, 1997 included in the Company's Form 10-KSB for further information. The financial information has been prepared in accordance with generally accepted accounting principles and has not been audited. In the opinion of management, the information presented reflects all adjustments necessary for a fair statement of interim results. All such adjustments are of a normal and recurring nature. The condensed consolidated results of operations for the three months and six months ended November 30, 1997 and 1996 are not necessarily indicative of the operating results for the full year. 7 PART I - ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The Company is engaged in the business of selling and installing industrial flooring systems. The following Management's Discussion and Analysis should be read in conjunction with the Management's Discussion and Analysis included in the Company's Form 10-KSB for the year ended May 31, 1997. Financial Condition Total assets at November 30, 1997 were $3,352,405 compared to $3,298,429 at the year ended May 31, 1997. The Company's cash position remains limited, $30,748 at November 30, 1997 compared to $21,397 at May 31, 1997. During the last several years, the Company's cash position has been limited and its ability to expand its operations in a meaningful way is restricted by its limited cash position. Receivables from non-affiliates increased from $900,123 at May 31, 1997 to $1,100,277 at November 30, 1997 an increase of approximately 22.24%. This significant increase was primarily the result of decreased collections. Receivables from affiliates were down slightly from $756,874 at May 31, 1997 to $748,331 at November 30, 1997. Total receivables were down $332,266 from total receivables at August 31, 1997. Inventories decreased slightly to $507,785 at November 30, 1997 compared to $535,155 at May 31, 1997. The Company does not currently have any lines of credit and has historically borrowed short term funds from its affiliates and from commercial banks for working capital. At November 30, 1997, the Company had total liabilities to banks of which $428,632 was classified as current debt. At May 31, 1997, the Company had total liabilities to banks of $444,323 which was classified as current debt. The Company's bank debt has historically been renewed in June of each year. This loan is secured by the Company's real property and is guaranteed by Donald L. Cox and Lucille M. Cox, officers and directors of the Company. At November 30, 1997, total liabilities were $2,078,162 compared to $2,150,657 at May 31, 1997. 8 Results of Operations The Company's revenues are primarily attributed to the sale of flooring components to franchisees and licensees, the sale and installation of complete flooring jobs by the Company. Effective March 1, 1997, the Company discontinued the sale and installation of interior ceiling and wall systems. The Company discontinued the product line to concentrate on Tufco flooring. Total net sales for the three month period ended November 30, 1997, were $1,445,274 compared to $ 1,917,846 for the three month period ended November 30, 1996, a decrease of approximately 24.64%. Total net sales for the six month period ended November 30, 1997, were $3,183,256 compared to $3,913,318 for the six month period ended November 30, 1996, a decrease of approximately 18.66%. The reduction in sales was primarily attributable to a reduction in installations by the company and the elimination of the Arcoplast Division. Operating Expenses. Cost of sales during the three month periods ended November 30, 1997 and November 30, 1996 were 71% of total net sales. Cost of sales during the six month period ended November 30, 1997 was 70% of total sales compared to 71% for the six month period ended November 30, 1996. For the three month period ended November 30, 1997, total general and administrative expenses were $286,846 (approximately 20% of total sales) compared to $294,144 (15% of total sales) for the three month period ended November 30, 1996. For the six month period ended November 30, 1997, total general and administrative expenses were $585,091 (approximately 18% of total sales) compared to $604,293 (15% of total sales) for the six month period ended November 30, 1996. Selling expenses were down for both the three month period and six month period ended November 30, 1997 from $191,831 and $413,538 respectively for the three months and six months ended November 30, 1996 to $116,233 and $217,704 for the three months and six months ended November 30, 1997. Total cost of sales and operating expenses for the three month period ended November 30, 1997 were $1,413,425 (98% of total sales) compared to $1,825,826 (95% of total sales) for the three month period ended November 30, 1996. Total cost of sales and operating expenses for the six month period ended November 30, 1997 were $2,981,249 (94% of total sales) compared to $3,768,051 (96% of total sales) for the six month period ended November 30, 1996. The decrease in selling expenses of $120,236 for the quarter ended November 30, 1997 compares to November 30, 1996 as the primary reason for the decrease in cost of goods sold and operating expenses as a percentage of revenue. Net Income. For the three month period ended November 30, 1997, the Company had net income of $19,616 compared to net income of $49,469 for the three month period ended November 9 30, 1996. For the six month period ended November 30, 1997, the Company had net income of $125,639 compared to net income of $73,158 for the six month period ended November 30, 1996. Inflation The Company's business and operations have not been materially affected by inflation during the past year and the current fiscal year. 10 PART II - OTHER INFORMATION Item 1. Legal Proceedings. None. Item 2. Changes in Securities. None. Item 3. Defaults Upon Senior Securities. None. Item 4. Submission of Matters to a Vote of Security Holders. None. Item 5. Other Information. Item 6(a). Exhibits. None. Item 6(b). Reports on Form 8-K. None 11 SIGNATURE In accordance with the requirements of the Exchange Act, the Registrant has caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Dated: January __, 1998 TUFCO INTERNATIONAL, INC. By /s/ Donald L. Cox Donald L. Cox President Principal Executive Officer By /s/ Brent E. Mills Brent E. Mills Controller Principal Financial Officer 12 EX-27 2 FDS -- WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM TUFCO INTERNATIONAL, INC.'S FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS 3-MOS MAY-31-1997 NOV-30-1997 30,478 0 2,033,608 185,000 507,785 2,513,455 1,230,734 491,744 3,352,405 2,023,198 0 0 0 6,966 1,267,277 3,352,405 1,445,274 1,445,274 1,030,778 1,413,425 0 0 0 31,849 12,233 19,616 0 0 0 19,616 .00282 0
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