-----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, PGbGV7muxyg/2adWn7uwuvW619YEnPhMSvhYArLSp84948SKWFS3Gt59Hjcu+QwV gGeK59YCj8D9qCKKX2nDSQ== 0001016193-99-000121.txt : 19991206 0001016193-99-000121.hdr.sgml : 19991206 ACCESSION NUMBER: 0001016193-99-000121 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990831 FILED AS OF DATE: 19991203 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: 99768261 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 QUARTER =============================================================================== 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 August 31, 1999 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 November 9, 1999 - 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 August 31, 1999 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 1Financial Statements: Condensed Consolidated Balance Sheet--August 31, 1999... 3 Condensed Consolidated Statements of Income for the three months ended August 31, 1999 and 1998.................. 5 Condensed Consolidated Statements of Cash Flows--for the three months ended August 31, 1999 and 1998........... 6 Notes to Condensed Consolidated Financial Statements.... 7 Item 2Management'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 AUGUST 31, 1999 Unaudited ASSETS CURRENT ASSETS: Cash $ 16,111 Accounts and notes receivable, less allowance for doubtful accounts of $235,000 Trade 1,062,684 Affiliates 548,464 Inventories 470,674 Deferred income tax benefits 98,230 Other current assets 38,766 ------------------ 2,234,929 ------------------ Property and equipment 1,152,572 Accumulated depreciation 508,579 ------------------ 643,993 ------------------ Reacquired franchise territory 356,558 Accumulated amortization 308,531 ------------------ 48,027 ------------------ Other assets 3,705 ------------------ $ 2,930,654 ================== 3 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Current maturities of long-term debt $ 61,417 Trade accounts payable 924,707 Income taxes payable 210,405 Accrued expenses 30,009 ------------------ 1,226,538 ------------------ LONG-TERM DEBT 419,663 ------------------ DEFERRED INCOME TAXES 27,998 ------------------ COMMON STOCKHOLDERS' EQUITY: Common stock,$.001 par value; authorized 50,000,000 shares; issued and outstanding 6,965,800 shar 6,966 Retained earnings 1,439,904 Other common stockholders' equity (190,415) ------------------ 1,256,455 ------------------ $ 2,930,654 ================== 4 TUFCO INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME For the three months ended August 31, 1999 and 1998 Unaudited 1999 1998 ------------------------------------ NET SALES: Trade $ 1,555,578 $ 1,272,923 Affiliates 188,876 109,644 ------------------------------------- 1,744,454 1,382,567 ------------------------------------ Cost of sales 1,153,592 933,218 Selling expenses 62,198 35,037 General and administrative expenses 281,818 239,638 Other income (60) (40,697) ------------------------------------- 1,497,548 1,167,196 ------------------------------------- Income before taxes 246,906 215,371 ------------------------------------- Provision for income taxes Current 97,344 88,010 Deferred (399) 34 ------------------------------------- 96,945 88,044 ------------------------------------- Net Income $ 149,961 $ 127,327 ===================================== INCOME PER SHARE: Net income $ 0.02153 $ 0.01828 ===================================== Weighted average number of shares outstanding 6,965,800 6,965,800 ===================================== 5 TUFCO INTERNATIONAL, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS For the three months ended August 31, 1999 and 1998 Unaudited 1999 1998 ------------------------------------- NET SALES PROVIDED BY (USED IN) Operating Activities $ 87,129 $ 66,225 ------------------------------------- CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property and equipment (23,439) 0 Proceeds from sale of property and 0 7,500 equipment ------------------------------------- Net cash provided by (used in) (23,439) 7,500 investing activities ------------------------------------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from long-term debt 467,187 0 Principal payments on long-term de (479,096) (12,272) Collection of capital contributions receivable 0 1,000 Employer loan for purchase of ESOP (45,318) (48,688) ------------------------------------- Net cash used in financing activit (57,227) (59,960) ------------------------------------- INCREASE (DECREASE) IN CASH 6,463 13,765 CASH, BEGINNING OF PERIOD 9,648 1,137 ------------------------------------- CASH, END OF PERIOD $ 16,111 $ 14,902 ===================================== 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, 1999 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 ended August 31, 1999 and 1998 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, 1999. Financial Condition Total assets at August 31, 1999 were $2,930,654 compared to $2,851,885 at the year ended May 31, 1999. The Company's cash position remains limited, $16,111 at August 31, 1999 compared to $9,648 at May 31, 1999. 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 decreased from $1,176,403 at May 31, 1999 to $1,062,684 at August 31, 1999 a decrease of approximately 9.67%. This decrease was primarily the result of increased collections. Receivables from affiliates were up slightly from $313,636 at May 31, 1999 to $548,464 at August 31, 1999. Inventories decreased to $470,674 at August 31, 1999 compared to $509,473 at May 31, 1999. 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 August 31, 1999, the Company had total liabilities to banks of $460,236 which $47,918 was classified as current debt. At May 31, 1999, the Company had total liabilities to banks of $468,840 of which $47,158 was classified as current debt. This loan is secured by the Company's real property and is guaranteed by Brent Mills, officer and director of the Company. At August 31, 1999, total liabilities were $1,674,199 compared to $1,680,848 at May 31, 1999. 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. Total net sales for the three month period ended August 31, 1999, were $1,744,454 compared to $1,382,567 for the three month period ended August 31, 1998, an increase of approximately 26.17%. The increase in sales was primarily attributable to an increase in installations performed by the Company's franchises. Operating Expenses. Cost of sales during the three month period ended August 31, 1999 was 66% compared to 67% for the three month period ended August 31, 1998. For the three month period ended August 31, 1999, total general and administrative expenses were $281,818 (approximately 16% of total sales) compared to $239,638 (17% of total sales) for the three month period ended August 31, 1998. Selling expenses increased for the three month period ended August 31, 1999 to $62,198 (4% of total sales) compared to $35,037 (3% of total sales) for the three months ended August 31, 1998. Total cost of sales and operating expenses for the three month period ended August 31, 1999 were $1,497,548 (86% of total sales) compared to $1,167,196 (84% of total sales) for the three month period ended August 31, 1998. Net Income. For the three month period ended August 31, 1999, the Company had net income of $149,961 compared to net income of $127,327 for the three month period ended August 31, 1998. Inflation The Company's business and operations have not been materially affected by inflation during the past year and the current fiscal year. Year 2000 The year 2000 ("Y2K") issue is the result of computer programs using a two-digit format, as opposed to four digits, to indicate the year. Such computer systems will be unable to interpret dates beyond 1999, which could cause a system failure or other computer errors, leading to disruptions in operations. In 1998, the Company developed a three-phase program for Y2K information systems compliance. Phase I is to identify those systems with which the Company has exposure to Y2K issues. Phase II is the development and implementation of action plans to be Y2K compliant in all areas by January 1999. Phase III to be completed by Mid-1999, is the final testing of each major area of exposure to ensure compliance. The Company has identified the major areas determined to be critical for successful Y2K compliance. (1) financial and informational system applications, and (2) third party relationships. 9 The Company, in accordance with Phase I of the program conducted an internal review of all systems and contacted all software suppliers to determine major areas of exposure to Y2K issues. In the financial and information system area, a number of applications have been identified as Y2K compliant due to their recent implementation. The Company's core financial and reporting systems are Y2K compliant. In the third-party area, the Company has communicated with the primary vendors and has determined that all are making significant progress toward their Y2K compliance. The Company believes it is compliant with Y2K. Forward-looking Statements The foregoing discussions in "Management's Discussion and Analysis of Financial Condition and Results of Operations" contain forward-looking statements, within the meaning of section 27a of the Securities Act of 1933 and section 21e of the Securities Act, which reflect Management's current views with respect to the future events and financial performance. Such forward looking statements may be deemed to include, among other things, statements relating to anticipated growth, and increased profitability, as well as to statements relating to the Company's strategic plan, including plans to develop and increase factored receivables, loan originations, and to selectively acquire other companies. These forward-looking statements are subject to certain risks and uncertainties, including, but not limited to, future financial performance and future events, competitive pricing for services, costs of obtaining capital as well as national, regional and local economic conditions. Actual results could differ materially from those addressed in the forward looking statement. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements, which speak only of the date hereof. 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 10 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: November 9, 1999. TUFCO INTERNATIONAL, INC. By Brent E. Mills President Principal Executive Officer 11 EX-27 2 FDS --
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 1 16,111 3-MOS MAY-31-2000 JUN-01-1999 AUG-31-1999 1 16,111 0 1,846,148 235,000 470,674 2,234,929 1,152,572 508,579 2,930,654 1,226,538 0 0 0 6,966 1,249,489 2,930,654 1,744,454 1,744,454 1,153,592 1,497,548 0 0 0 246,906 96,945 149,961 0 0 0 149,961 .02 0
-----END PRIVACY-ENHANCED MESSAGE-----