-----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, OBwB7IM8dHzSn23GDOU9nQiE1QlojogfBMFWVkIGeTHqg6tOTG/hbvMWfJ0qbzX9 P3MLg4sNLwJ7+fRFm3q1+g== 0000849401-03-000001.txt : 20030214 0000849401-03-000001.hdr.sgml : 20030214 20030214131010 ACCESSION NUMBER: 0000849401-03-000001 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20021231 FILED AS OF DATE: 20030214 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ADM TRONICS UNLIMITED INC/DE CENTRAL INDEX KEY: 0000849401 STANDARD INDUSTRIAL CLASSIFICATION: ADHESIVES & SEALANTS [2891] IRS NUMBER: 221896032 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-17629 FILM NUMBER: 03565302 BUSINESS ADDRESS: STREET 1: 224 S PEGASUS AVE CITY: NORTHVALE STATE: NJ ZIP: 07647 BUSINESS PHONE: 2017676040 MAIL ADDRESS: STREET 1: 224 S PEGASUS AVE CITY: NORTHVALE STATE: NJ ZIP: 07647 10QSB 1 q123102.txt SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-QSB (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2002 OR [ ] TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to _______ Commission File No. 0-17629 ADM TRONICS UNLIMITED, INC. (Exact name of registrant as specified in its Charter) Delaware 22-1896032 (State or Other Jurisdiction (I.R.S. Employer Identifi- of Incorporation or organization) cation Number) 224-S Pegasus Ave., Northvale, New Jersey 07647 (Address of Principal Executive Offices) Issuer's Telephone Number, including area code: (201) 767-6040 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 past 12 months (or for Such shorter period that the Issuer was required to file such reports), And (2) has been subject to the filing requirements for the past 90 days: YES X NO ______ State the number of shares outstanding of each of the Issuer's classes of common equity, as of the latest practicable date: 48,882,037 shares of Common Stock, $.0005 par value, as of February 4, 2003 ADM TRONICS UNLIMITED, INC. INDEX Page Number Part I. Financial Information Item 1. Consolidated Financial Statements: Consolidated Balance Sheets - December 31, 2002 and March 31, 2002 2 Consolidated Statements of Operations - For the three months and nine months ended December 31, 2002 and 2001 3 Consolidated Statement of Changes in Stockholders' Equity - For the nine months ended December 31, 2002 3 Consolidated Statements of Cash Flows - For the nine months ended December 31, 2002 and 2001 4 Notes to Consolidated Financial Statements 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 6-7 CERTIFICATION OF PERIODIC REPORT I, Andre' Di Mino, President of ADM Tronics Unlimited, Inc. (the "Company"), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that: (1) the Quarterly Report on Form 10-QSB of the Company for the quarterly period ended December 30, 2002 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated: February 14, 2003 /s/ Andre' Di Mino Andre' Di Mino President 1 ADM TRONICS UNLIMITED, INC. CONSOLIDATED BALANCE SHEETS (UNAUDITED) DECEMBER MARCH ASSETS 30, 2002 31, 2002 Current assets: Cash and equivalents $ 55,224 $ 51,565 Accounts receivable--trade, less allowance for doubtful accounts of $4,593 128,544 215,502 Inventories: Raw materials and supplies 263,788 303,202 Finished goods 41,522 35,628 Equipment held for sale 681,675 681,154 Other current assets 28,787 30,504 Total current assets 1,199,540 1,317,555 Property and equipment 36,770 60,671 Equipment in use and under lease agreements, net of accumulated depreciation of $46,167 and $391,272 respectively 337,621 432,047 Loan receivable from officer, bearing interest at 3% per annum, unsecured 50,291 53,791 Other assets 131,637 143,952 Total assets 1,755,858 2,008,016 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable-trade 257,786 252,478 Accrued expenses and other 45,416 79,473 Notes payable 147,325 110,000 Total current liabilities 450,527 441,951 Notes payable - long term portion - 25,000 Stockholders' equity 1,305,332 1,541,065 Total liabilities and stockholders' equity $1,755,859 $2,008,016 2 ADM TRONICS UNLIMITED, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) THREE MONTHS ENDED NINE MONTHS ENDED DECEMBER 31, DECEMBER 31, 2002 2001 2002 2001 Revenues $245,802 $287,768 $674,543 $1,122,279 Costs and expenses: Cost of sales 180,423 (32,158) 334,650 503,888 Selling, general and administrative 140,092 218,848 663,658 836,699 Total costs and expenses 320,515 186,690 998,308 1,340,587 Operating income (loss) (74,713) 101,078 (323,765) (218,308) Other income: Interest and other income 18,589 349 88,032 3,905 Net income (loss) (56,124) 101,427 (235,733) (214,403) Net income (loss) per common share $(0.001) $ 0.002 $(0.005) $(0.004) ADM TRONICS UNLIMITED, INC. CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY FOR THE NINE MONTHS ENDED DECEMBER 31, 2002 (UNAUDITED) CAPITAL IN EXCESS OF PAR PAR ACCUMULATED SHARES VALUE VALUE DEFICIT TOTAL Balance, March 31, 2002 47,382,037 $23,691 $6,763,618 $(5,246,244) $1,541,065 Sale of Common Stock 1,500,000 750 14,250 Net loss for the nine Months ended December 31, 2002 (235,733) (235,733) Balance, December 31, 2002 48,882,037 $24,441 $6,777,868 $(5,481,977) $1,305,332 3 ADM TRONICS UNLIMITED, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) NINE MONTHS ENDED DECEMBER 31, 2002 2001 Cash flows from Operating activities: Net income (loss) $(235,733) $(214,403) Adjustments to reconcile net income (loss) to net cash from operating activities: Depreciation and amortization 125,386 141,507 Changes in operating assets and liabilities: Accounts receivable 86,958 15,296 Inventories 33,520 (246,058) Other current assets 1,717 3,677 Equipment in use or under lease - 128,188 Equipment held for sale (521) 252,183 Other assets 12,315 (87,221) Accounts payable (5,308) 41,470 Accrued expenses and other (32,364) (84,352) Net cash flows provided by (used in) operating activities (14,030) (49,713) Cash flows from Investing activities: Purchases of property and equipment (811) (25,131) Repayments of loan to officer 3,500 3,900 Net cash flows provided by (used in) investing activities 2,689 (21,231) Cash flows from Financing activities: Borrowings on notes payable - 10,000 Payments on notes payable - (20,904) Issuance of stock for cash 15,000 - Net cash flows provided by (used in) financing activities 15,000 (10,904) Net change in cash and cash equivalents $ 3,659 $(81,848) Cash and cash equivalents--beginning of year $ 51,565 $113,458 Cash and cash equivalents--end of period $ 55,224 $ 31,610 Supplemental disclosure of cash flow activities: Interest paid 4,227 1,546 4 ADM TRONICS UNLIMITED, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Note 1-Basis of Presentation: The consolidated balance sheet at the end of the preceding fiscal year has been derived from the audited consolidated balance sheet contained in the Company's annual report on Form 10-KSB for the fiscal year ended March 31, 2002 (the "Form 10-KSB") and is presented for comparative purposes. All other financial statements are unaudited. In the opinion of management, all adjustments which include only normal recurring adjustments necessary to present fairly the financial position, results of operations and changes in financial positions for all periods presented have been made. The results of operations for interim periods are not necessarily indicative of the operating results for the full year. Footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted in accordance with the published rules and regulations of the Securities and Exchange Commission. These consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in the Form 10-KSB. Note 2. Segment Information Information about segment information is as follows: Nine Months Ended December 31, 2002: CHEMICAL MEDICAL TOTAL Revenues from external customers 606,536 68,007 674,543 Segment profit (loss) 140,280 (95,453) (235,733) Nine Months Ended December 31, 2001: Revenues from external customers 517,585 604,694 1,122,279 Segment profit (loss) (65,373) (149,030) (214,403) Three Months Ended December 31, 2002: Revenues from external customers 220,892 24,910 245,802 Segment profit (loss) 85,105 (141,229) (56,124) Three Months Ended December 31, 2001: Revenues from external customers 150,954 136,814 287,768 Segment profit (loss) 127,253 (25,776) 101,477 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Liquidity and Capital Resources At December 31, 2002 the Company had cash and equivalents of $55,224 as compared to $51,565 at March 31, 2002. This increase was the result of net cash flows provided by investing and financing activities of $2,689 and $15,000, respectively, offset by net cash used in operating activities of $14,030. Operating Activities Net cash flows used in operating activities decreased $35,683 to $14,030 for the nine months ended December 31, 2002 as compared to $49,713 for the nine months ended December 31, 2001. Cash flows used in operating activities primarily resulted from the net loss for the period of $235,733, a reduction in accounts payable of $5,308 and accrued expenses of $32,363, collectively offset by a reduction in inventories and other assets of $47,552, depreciation and amortization of $125,386 and accounts payable of $86,958. Investing Activities Cash flows provided by investing activities consisted of repayments of the officer loan offset by cash expenditures of $811 for the purchase of equipment. Financing Activities Cash flows provided by financing activities consisted of $15,000 received from the sale of common stock. The Company does not have any material external sources of liquidity or unused sources of funds. Results of Operations Quarter Ended December 31, 2002 Revenues Revenues were $245,802 in 2002 as compared to $448,586 in 2001 representing a decrease of $202,784 or 45%. Revenues from the Company's medical electronics activities decreased $136,814 primarily due to significantly reduced contract manufacturing revenues. Chemical revenues increased $69,938 in 2002 as compared to 2001. Gross Profit Gross profit of $65,379 in 2002 as compared to $255,610 in 2001 was $190,231 or 74% below the gross profit in 2001. Gross profit was 27% of revenues in 2002 as compared with 38% of revenues in 2001. The decrease in gross profit margin was primarily due to certain inventory write-offs during 2002 and the maintenance of manufacturing labor overhead with reduced contract manufacturing revenues. 6 Operating Income (Loss) Operating loss in 2002 was ($74,713) compared to ($101,078) in 2001. Selling, general and administrative expenses decreased by $78,756 primarily due to a reduction in personnel and related overhead expenses from the reduction in contract manufacturing activities. Other Income Other income in 2002 was $18,589 as compared to $349 in 2001. The increase was primarily due to revenues received from equipment rentals and amounts received from a joint venture in 2002. Results of Operations Nine Months Ended December 31, 2002 Revenues Revenues were $674,543 as compared to $1,122,279 in 2001 representing a decrease of $447,736 or 39%. Revenues from the Company's medical electronics activities decreased $536,687 primarily due to significantly reduced contract manufacturing revenues. Chemical revenues increased $88,951. Gross Profit Gross profit of $339,893 in 2002 as compared to $618,391 in 2001 was $278,498 or 45% lower than the gross profit in 2001. Gross profit was 50% of revenues in 2002 and 55% in 2001. The decrease in gross profit margin is due to the mix in product sales with higher sales of products with a lower gross margin and certain write-offs of inventory during 2002 and the maintenance of contract manufacturing labor overhead with reduced contract manufacturing revenues. Operating Income (Loss) Operating loss was ($323,766) in 2002 compared to ($218,308) in 2001. Selling, general and administrative expenses decreased by $173,041 due to a reduction in personnel and related overhead expenses. Other Income Other income of $88,032 in 2002 increased $84,127 from $3,905 in 2001. The increase was primarily due to revenues received from equipment rentals and amounts received from a joint venture in 2002. 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. ADM Tronics Unlimited, Inc. By:\s\ Andre' DiMino Andre' DiMino President Dated: Northvale, New Jersey February 14, 2002 7 -----END PRIVACY-ENHANCED MESSAGE-----