Delaware | 22-1896032 |
(State or Other Jurisdiction | (I.R.S. Employer |
of Incorporation or organization) | Identification Number) |
Large accelerated filer [ ] | Accelerated filer [ ] |
Non-accelerated filer [ ] (Do not check if a smaller reporting company) | Smaller reporting company [X] |
Page Number
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Part I - Financial Information | |||||||||||||
Item 1.
|
Consolidated Financial Statements:
|
||||||||||||
Condensed Consolidated Balance Sheet - September 30, 2011 (unaudited) and March 31, 2011
|
3
|
||||||||||||
Condensed Consolidated Statement of Operations for the three and six months ended September 30, 2011 and 2010 (unaudited)
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4 | ||||||||||||
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|||||||||||||
Condensed Consolidated Statements of Cash Flow for the six months ended September 30, 2011 and 2010 (unaudited)
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5 | ||||||||||||
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|||||||||||||
Notes to the Condensed Consolidated Financial Statements (unaudited)
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6
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||||||||||||
Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations | 12 | |||||||||||
Item 3.
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Quantitative and Qualitative Disclosures about Market Risk
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15
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|||||||||||
Item 4.
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Controls and Procedures
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15
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|||||||||||
Part II - Other Information
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|||||||||||||
Item 1.
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Legal Proceedings
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15
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|||||||||||
Item 1A.
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Risk Factors
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15
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|||||||||||
Item 2.
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Unregistered Sales of Equity Securities and Use of Proceeds
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15
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|||||||||||
Item 3.
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Defaults Upon Senior Securities
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16
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|||||||||||
Item 4.
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Other Information
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16
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|||||||||||
Item 5.
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Exhibits
|
16
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September 30,
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March 31,
|
|||||||
2011
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2011
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|||||||
(Unaudited)
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||||||||
ASSETS
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||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 164,090 | $ | 155,149 | ||||
Accounts receivable, net of allowance for doubtful accounts of $329 and $529, respectively
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224,636 | 115,844 | ||||||
Inventories
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293,600 | 232,499 | ||||||
Prepaid expenses and other current assets
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48,984 | 20,441 | ||||||
Restricted cash
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231,102 | 230,559 | ||||||
Total current assets
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962,412 | 754,492 | ||||||
Property and equipment, net of accumulated depreciation of $63,515 and $56,421, respectively
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34,534 | 41,627 | ||||||
Other assets:
|
||||||||
Inventory - long term portion
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29,232 | 31,951 | ||||||
Secured convertible note
|
59,844 | 57,337 | ||||||
Advances to related parties
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28,589 | 28,589 | ||||||
Intangible assets, net of accumulated amortization of $138,534 and $124,168, respectively
|
129,614 | 140,396 | ||||||
Other assets
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16,109 | 16,109 | ||||||
Total other assets
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263,388 | 274,382 | ||||||
Total assets
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$ | 1,260,334 | $ | 1,070,501 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
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$ | 191,729 | $ | 184,122 | ||||
Note payable - bank
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166,000 | 172,000 | ||||||
Note payable - other
|
6,650 | 13,900 | ||||||
Customer deposit payable
|
150,816 | - | ||||||
Accrued expenses and other current liabilities
|
119,916 | 56,457 | ||||||
Total current liabilities
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635,111 | 426,479 | ||||||
Total liabilities
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635,111 | 426,479 | ||||||
Stockholders' equity:
|
||||||||
Preferred stock, $.01 par value; 5,000,000 shares authorized, no shares issued and outstanding
|
- | - | ||||||
Common stock, $.0005 par value; 150,000,000 shares authorized, 56,939,537 shares issued and outstanding at September 30, 2011 and March 31, 2011
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28,470 | 28,470 | ||||||
Additional paid-in capital
|
32,173,097 | 32,173,097 | ||||||
Accumulated deficit
|
(31,576,344 | ) | (31,557,545 | ) | ||||
Total stockholders' equity
|
625,223 | 644,022 | ||||||
Total liabilities and stockholders' equity
|
$ | 1,260,334 | $ | 1,070,501 |
Three months ended
|
Six months ended
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|||||||||||||||
September 30,
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September 30,
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|||||||||||||||
2011
|
2010
|
2011
|
2010
|
|||||||||||||
Net revenues
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$ | 472,689 | $ | 264,730 | $ | 891,751 | $ | 617,523 | ||||||||
Cost of sales
|
191,252 | 155,389 | 405,463 | 322,100 | ||||||||||||
Gross Profit
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281,437 | 109,341 | 486,288 | 295,423 | ||||||||||||
Operating expenses:
|
||||||||||||||||
Research and development
|
8,697 | 10,007 | 18,001 | 24,693 | ||||||||||||
Selling, general and administrative
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230,966 | 290,218 | 466,768 | 525,341 | ||||||||||||
Depreciation and amortization
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10,693 | 10,782 | 21,460 | 21,510 | ||||||||||||
Total operating expenses
|
250,356 | 311,007 | 506,229 | 571,544 | ||||||||||||
Income (loss) from operations
|
31,081 | (201,666 | ) | (19,941 | ) | (276,121 | ) | |||||||||
Other income (expense):
|
||||||||||||||||
Interest income
|
1,599 | 2,047 | 3,240 | 4,546 | ||||||||||||
Interest expense
|
(1,034 | ) | (1,319 | ) | (2,098 | ) | (2,680 | ) | ||||||||
Total other income (expense)
|
565 | 728 | 1,142 | 1,866 | ||||||||||||
Net income (loss)
|
$ | 31,646 | $ | (200,938 | ) | $ | (18,799 | ) | $ | (274,255 | ) | |||||
Basic and diluted income (loss) per common share:
|
$ | 0.00 | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.01 | ) | |||||
Weighted average shares of common stock outstanding - basic and diluted
|
56,939,537 | 53,939,537 | 56,939,537 | 53,939,537 |
September 30,
|
September 30,
|
|||||||
2011
|
2010
|
|||||||
(Unaudited)
|
(Unaudited)
|
|||||||
Cash flows from operating activities:
|
||||||||
Net loss
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$ | (18,799 | ) | $ | (274,255 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||
Depreciation and amortization
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21,460 | 21,510 | ||||||
Bad debt recovery
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- | (1,620 | ) | |||||
Interest receivable
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(2,507 | ) | (2,181 | ) | ||||
Changes in operating assets and liabilities:
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||||||||
Accounts receivable
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(108,792 | ) | (55,884 | ) | ||||
Inventory
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(58,382 | ) | 12,620 | |||||
Prepaid expenses and other current assets
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(37,010 | ) | (5,008 | ) | ||||
Accounts payable
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16,073 | 71,475 | ||||||
Customer deposit payable | 150,816 | - | ||||||
Accrued expenses and other current liabilities
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63,459 | 31,253 | ||||||
Net cash provided by (used in) operating activities
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26,318 | (202,090 | ) | |||||
Cash flows from investing activities:
|
||||||||
Repayment (advances to) from related party
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- | 16,760 | ||||||
Payment for patents and trademark costs
|
(3,584 | ) | (5,685 | ) | ||||
Deposit - restricted cash
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(543 | ) | (1,097 | ) | ||||
Net cash provided by (used in) investing activities
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(4,127 | ) | 9,978 | |||||
Cash flows from financing activities:
|
||||||||
Repayments on note payable - Bank
|
(6,000 | ) | (6,000 | ) | ||||
Repayments on note payable - Other
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(7,250 | ) | (8,700 | ) | ||||
Net cash used in financing activities
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(13,250 | ) | (14,700 | ) | ||||
Net increase (decrease) in cash
|
8,941 | (206,812 | ) | |||||
Cash and cash equivalents beginning of period
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155,149 | 690,975 | ||||||
Cash and cash equivalents at end of period
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$ | 164,090 | $ | 484,163 | ||||
Cash paid for:
|
||||||||
Interest
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$ | 2,098 | $ | 2,680 | ||||
Income taxes
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$ | - | $ | 3,460 | ||||
Supplemental disclosures of non-cash investing and financing activities:
|
||||||||
Accrued interest on note receiveable
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$ | 2,507 | $ | - | ||||
Increase in prepaid insurance and accounts payable
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$ | 8,466 | $ | 4,613 |
Asset Acquisition of Antistatic Industries of Delaware, Inc.:
|
||||
Fair Value of assets acquired in fiscal year 2010
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$ | 66,920 | ||
Cash paid to Seller
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$ | (26,920 | ) | |
Cash paid to Seller under Note Payable
|
(33,350 | ) | ||
Note payable outstanding at September 30, 2011
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(6,650 | ) | ||
$ | (66,920 | ) | ||
Year ended March 31, 2010 Asset Acquisitions
|
||||
Details of Acquisition
|
||||
Fair Value of assets acquired in fiscal year 2010
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$ | 66,920 | ||
Note Payable balance at September 30, 2011
|
(6,650 | ) | ||
Total cash paid for acquisition
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$ | 60,270 |
Current
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Long Term
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Total
|
||||||||||
Raw materials
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$ | 261,381 | $ | 25,624 | $ | 287,005 | ||||||
Finished Goods
|
32,219 | 3,608 | 35,827 | |||||||||
$ | 293,600 | $ | 29,232 | $ | 322,832 |
Current
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Long Term
|
Total
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||||||||||
Raw materials
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$ | 177,606 | $ | 28,252 | $ | 205,858 | ||||||
Finished Goods
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54,893 | 3,699 | 58,592 | |||||||||
$ | 232,499 | $ | 31,951 | $ | 264,450 |
Level 1
|
Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
|
|
Level 2
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Quoted prices in markets that are not active; or other inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability.
|
|
Level 3
|
Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable.
|
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
Investment in ITI
|
$ | 21,125 | $ | (21,125 | ) | $ | -- | $ | -- |
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
Investment in ITI
|
$ | 29,250 | $ | (29,250 | ) | $ | -- | $ | -- |
September 30, 2011 | March 31, 2011 | |||||||||||||||||||||||
Cost
|
Accumulated Amortization
|
Net Carrying Amount
|
Cost
|
Accumulated Amortization
|
Net Carrying Amount
|
|||||||||||||||||||
Patents & Trademarks
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$ | 82,702 | (61,355 | ) | $ | 21,347 | $ | 79,118 | $ | (60,218 | ) | $ | 18,900 | |||||||||||
Formulas
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25,446 | (3,746 | ) | 21,700 | 25,446 | (2,898 | ) | 22,548 | ||||||||||||||||
Non-Compete Agreement
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50,000 | (22,024 | ) | 27,976 | 50,000 | (18,452 | ) | 31,548 | ||||||||||||||||
Controller Design
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100,000 | (44,048 | ) | 55,952 | 100,000 | (36,905 | ) | 63,095 | ||||||||||||||||
Customer List
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10,000 | (7,361 | ) | 2,639 | 10,000 | (5,695 | ) | 4,305 | ||||||||||||||||
$ | 268,148 | $ | (138,534 | ) | $ | 129,614 | $ | 264,564 | $ | (124,168 | ) | $ | 140,396 |
2012
|
$ | 14,472 | ||
2013
|
26,180 | |||
2014
|
25,114 | |||
2015
|
25,064 | |||
2016
|
12,020 | |||
Thereafter
|
26,764 | |||
$ | 129,614 |
Chemical
|
Electronics
|
Total
|
||||||||||
Three months ended September 30, 2011
|
||||||||||||
Revenue from external customers
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$ | 252,232 | $ | 220,457 | $ | 472,689 | ||||||
Segment operating income (loss)
|
$ | 28,848 | $ | 2,233 | $ | 31,081 | ||||||
Three months ended September 30, 2010
|
||||||||||||
Revenue from external customers
|
$ | 203,033 | $ | 61,697 | $ | 264,730 | ||||||
Segment operating income (loss)
|
$ | (45,930 | ) | $ | (155,736 | ) | $ | (201,666 | ) | |||
Six months ended September 30, 2011
|
||||||||||||
Revenue from external customers
|
$ | 545,236 | $ | 346,515 | $ | 891,751 | ||||||
Segment operating income (loss)
|
$ | 53,549 | $ | (73,490 | ) | $ | (19,941 | ) | ||||
Six months ended September 30, 2010
|
||||||||||||
Revenue from external customers
|
$ | 478,401 | $ | 139,122 | $ | 617,523 | ||||||
Segment operating income (loss)
|
$ | (19,108 | ) | $ | (257,013 | ) | $ | (276,121 | ) | |||
Total assets at September 30, 2011
|
$ | 824,177 | $ | 436,157 | $ | 1,260,334 | ||||||
Total assets at March 31, 2011
|
$ | 462,681 | $ | 607,820 | $ | 1,070,501 |
Inventory
|
$ | 11,474 | ||
Equipment | 10,000 | |||
Patents and trademarks | 10,000 | |||
Formulas | 25,446 | |||
Customer list | 10,000 | |||
Total | $ | 66,920 |
|
By:
|
/s/ Andre' DiMino | |
Andre' DiMino, Chief Executive | |||
Officer and Chief Financial Officer | |||
Dated: | Northvale, New Jersey |
November 14, 2011 |
Date: November 14, 2011
|
By:
|
/s/ Andre' DiMino | |
Andre' DiMino | |||
Chief Executive Officer
|
|||
Date: November 14, 2011
|
By:
|
/s/ Andre' DiMino | |
Andre' DiMino | |||
Chief Financial Officer
|
|||
Date: November 14, 2011
|
By:
|
/s/ Andre' DiMino | |
Chief Executive Officer and | |||
Chief Financial Officer
|
|||
Condensed Consolidated Balance Sheets (Parentheticals) (USD $) | Sep. 30, 2011 | Mar. 31, 2011 |
---|---|---|
Allowance for doubtful accounts (in Dollars) | $ 329 | $ 529 |
Accumulated depreciation (in Dollars) | 63,515 | 56,421 |
Accumulated amortization (in Dollars) | $ 138,534 | $ 124,168 |
Preferred stock par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in Dollars per share) | $ 0.0005 | $ 0.0005 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 56,939,537 | 56,939,537 |
Common stock, shares outstanding | 56,939,537 | 56,939,537 |
Condensed Consolidated Statement of Operations (Unaudited) (USD $) | 3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2011 | Sep. 30, 2010 | |
Net revenues | $ 472,689 | $ 264,730 | $ 891,751 | $ 617,523 |
Cost of sales | 191,252 | 155,389 | 405,463 | 322,100 |
Gross Profit | 281,437 | 109,341 | 486,288 | 295,423 |
Operating expenses: | ||||
Research and development | 8,697 | 10,007 | 18,001 | 24,693 |
Selling, general and administrative | 230,966 | 290,218 | 466,768 | 525,341 |
Depreciation and amortization | 10,693 | 10,782 | 21,460 | 21,510 |
Total operating expenses | 250,356 | 311,007 | 506,229 | 571,544 |
Income (loss) from operations | 31,081 | (201,666) | (19,941) | (276,121) |
Other income (expense): | ||||
Interest income | 1,599 | 2,047 | 3,240 | 4,546 |
Interest expense | (1,034) | (1,319) | (2,098) | (2,680) |
Total other income (expense) | 565 | 728 | 1,142 | 1,866 |
Net income (loss) | $ 31,646 | $ (200,938) | $ (18,799) | $ (274,255) |
Basic and diluted income (loss) per common share: (in Dollars per share) | $ 0.00 | $ 0.00 | $ 0.00 | $ (0.01) |
Weighted average shares of common stock outstanding - basic and diluted (in Shares) | 56,939,537 | 53,939,537 | 56,939,537 | 53,939,537 |
Document And Entity Information | 6 Months Ended | |
---|---|---|
Sep. 30, 2011 | Nov. 14, 2011 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | ADM TRONICS UNLIMITED INC/DE | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --03-31 | |
Entity Common Stock, Shares Outstanding | 56,939,537 | |
Amendment Flag | false | |
Entity Central Index Key | 0000849401 | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Filer Category | Smaller Reporting Company | |
Entity Well-known Seasoned Issuer | No | |
Document Period End Date | Sep. 30, 2011 | |
Document Fiscal Year Focus | 2011 | |
Document Fiscal Period Focus | Q2 |
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Note 7 - Concentrations | 6 Months Ended |
---|---|
Sep. 30, 2011 | |
Concentration Risk Disclosure [Text Block] |
NOTE
7 – CONCENTRATIONS
The
Company’s customer base is comprised of foreign and
domestic entities with diverse demographics. Revenues from
foreign customers represented $45,804 of net revenue or 9.7%
for the three months ended September 30, 2011 and $114,916 of
net revenue or 12.9% of net revenue for the six months ended
September 30, 2011. Revenues from foreign customers
represented $35,685 of net revenue or 13% for the
three months ended September 30, 2010 and $59,893 of net
revenue or 9.7% of net revenue for the six months ended
September 30, 2010.
Accounts
receivable from foreign entities as of September 30, 2011 and
March 31, 2011 were $5,610 and $2,573, respectively.
During
the three month period ended September 30, 2011, two
customers accounted for 39% of our revenue. As of September
30, 2011, three customers represented approximately 77% of
our accounts receivable.
During
the three month period ended September 30, 2010, three
customers accounted for 37% of our revenue, during such
period IHS accounted for 5% of our revenue. As of September
30, 2010, two customers represented approximately 42% of our
accounts receivable.
During
the six month period ended September 30, 2011, two customers
accounted for 29% of our revenue. As of March 31,
2011, one customer represented approximately 28% of our
accounts receivable.
During
the six month period ended September 30, 2010, two customers
accounted for 32% of our revenue, during such period IHS
accounted for 5% of our revenue. As of September 30, 2010,
two customers represented approximately 42% of our accounts
receivable.
|
Note 12 - Customer Deposit | 6 Months Ended |
---|---|
Sep. 30, 2011 | |
Other Liabilities Disclosure [Text Block] |
NOTE
12 – CUSTOMER DEPOSIT
In
July 2011 the Company received a deposit of $179,450 in
conjunction with an order for 200 units of the FloMed
device. During the three month period ended September 30,
2011, we recognized $126,920 in revenue from the sale of
the FloMed.
|
Note 3 - Inventory | 6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Text Block] |
NOTE
3 - INVENTORY
Inventory
at September 30, 2011 (unaudited) consisted of the
following:
Inventory
at March 31, 2011 consisted of the following:
The
Company values its inventories at the first in, first out
("FIFO") method at the lower of cost or market.
|
Note 9 - Related Party Transactions | 6 Months Ended |
---|---|
Sep. 30, 2011 | |
Related Party Transactions Disclosure [Text Block] |
NOTE
9 - RELATED PARTY TRANSACTIONS
ADVANCES
TO RELATED PARTIES
As
of September 30, 2011 and March 31, 2011 total accrued
interest on prior loans to an officer was $28,589 and
$28,589, respectively.
|
Note 10 - Note Payable, Bank | 6 Months Ended |
---|---|
Sep. 30, 2011 | |
Debt Disclosure [Text Block] |
NOTE
10 – NOTE PAYABLE, BANK
On
August 21, 2008, the Company entered into a note payable with
a commercial bank in the amount of $200,000. This
note bears interest at a rate of 2.98% and is secured by cash
on deposit with the institution, which is classified as
restricted cash. Amounts outstanding under the
note are payable on demand, and interest is payable
monthly. The principal balance of the note at
September 30, 2011 and March 31, 2011 was $166,000 and
$172,000, respectively.
|
Note 8 - Segment Information | 6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Disclosure [Text Block] |
NOTE
8 - SEGMENT INFORMATION
Information
about segments is as follows:
|
Note 1 - Organizational Matters | 6 Months Ended |
---|---|
Sep. 30, 2011 | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] |
NOTE
1 - ORGANIZATIONAL MATTERS
ADM
Tronics Unlimited, Inc. ("we", "us", the “Company" or
"ADM"), was incorporated under the laws of the state of
Delaware on November 24, 1969. We are authorized
under our Certificate of Incorporation to issue 150,000,000
common shares, with $.0005 par value, and 5,000,000 preferred
shares with $.01 par value.
The
accompanying condensed consolidated financial statements as
of September 30, 2011 (unaudited) and March 31, 2011 and for
the six month periods ended September 30, 2011 and 2010
(unaudited) have been prepared by ADM pursuant to the rules
and regulations of the Securities and Exchange Commission
(“SEC”) including Form 10-Q and Regulation
S-X. The information furnished herein reflects all
adjustments (consisting of normal recurring accruals and
adjustments) which are, in the opinion of management,
necessary to fairly present the operating results for the
respective periods. Certain information and
footnote disclosures normally present in annual financial
statements prepared in accordance with accounting principles
generally accepted in the United States of America have been
omitted pursuant to such rules and regulations. These
financial statements and the information included under the
heading "Management's Discussion and Analysis of Financial
Condition and Results of Operations" should be read in
conjunction with the audited financial statements and
explanatory notes for the year ended March 31, 2011 as
disclosed in our annual report on Form 10-K for that year as
filed with the SEC, as it may be amended. The
results of the six months ended September 30, 2011
(unaudited) are not necessarily indicative of the results to
be expected for the pending full year ending March 31,
2012.
NATURE
OF BUSINESS
We
are a manufacturing and engineering concern whose principal
lines of business are the production and sale of chemical
products and the manufacture and sale of electronics. On July
17, 2009, we purchased the assets of Antistatic Industries of
Delaware Inc., (“Antistatic”) a company involved
in the research, development and manufacture of water-based
and proprietary electrically conductive paints, coatings and
other products and accessories which can be used by
electronics, computer, pharmaceutical and chemical companies
to prevent, reduce or eliminate static electricity.
Our
chemical product line is principally comprised of water-based
chemical products used in the food packaging and converting
industries, and anti-static conductive paints, coatings and
other products. These products are sold to customers located
in the United States, Australia, Asia and Europe. Electronics
equipment is manufactured in accordance with customer
specifications on a contract basis. Our electronic device
product line consists principally of proprietary devices used
in the treatment of joint pain in humans and animals,
tinnitus and electronic controllers for spas and hot tubs.
These products are sold to customers located principally in
the United States.
During
the three months ended June 30, 2009, we invested in
Wellington Scientific, LLC (“Wellington”) which
has rights to an electronic uroflowmetry diagnostic medical
device technology. These products were
currently distributed in South
Africa, and were not compliant with United
States FDA requirements for distribution in the United
States. During the year ended March 31, 2011, we
substantially completed development of a new version of the
device for compliance with FDA and international standards
and created the required documentation for distribution of
this product in the US. In July 2011, an order was received
from a distributor for $717,800, including a 25% cash deposit
for the purchase of the Flo-Med device and related
disposables. Production of the Flo-Med device and
disposables commenced during the period and the complete
order is expected to be shipped over the next 3 to 6
months.
|
Note 4 - Fair Value Measurements | 6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Text Block] |
NOTE
4 – FAIR VALUE MEASUREMENTS
The
Company follows the accounting pronouncement with respect to
fair value of financial assets and liabilities, as well as
for any other assets and liabilities that are carried at fair
value on a recurring basis. The pronouncement defines fair
value as the exchange price that would be received for an
asset or paid to transfer a liability (an exit price) in the
principal or most advantageous market for the asset or
liability in an orderly transaction between market
participants on the measurement date. The pronouncement also
establishes a fair value hierarchy, which requires an entity
to maximize the use of observable inputs and minimize the use
of unobservable inputs when measuring fair value. The
pronouncement describes three levels of inputs that may be
used to measure fair value:
The
following table presents assets measured at fair value on a
recurring basis at September 30, 2011:
During
the quarter ended June 30, 2009, management had determined
the investment in ITI should be valued using both Level 1 and
Level 2 inputs.
In
August 2009, ITI disclosed to the public through its filings
with the SEC, that it would most likely not be able to
continue its operations. On February 12, 2010, ITI sold
substantially all of its assets to IHS, and in an additional
filing with the SEC, it indicated that proceeds from such
sale would not be sufficient to pay all of its liabilities.
ITI also publicly stated that it intended to liquidate and
anticipated there would not be a distribution to its
shareholders. In the quarter ended June 30, 2009, the Company
recorded a decrease in fair value of $715,000 writing down
the investment in ITI to $0.
The
following table presents assets measured at fair value on a
recurring basis at March 31, 2011:
|
Note 5 - Note Receivable | 6 Months Ended |
---|---|
Sep. 30, 2011 | |
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] |
NOTE
5 – NOTE RECEIVABLE
On
June 4, 2009 the Company invested in Wellington Scientific,
LLC (Wellington) which has rights to an electronic
uroflowmetry diagnostic medical device technology. The
Company invested a total of $50,000, with $10,000 provided in
cash, and $40,000 in services to Wellington. The
Company recorded a convertible note with a
principal amount of $50,000 with an interest rate of 10% due
at various dates through September 2011. The original
note and accrued interest was due June 30,
2011. As of September 30, 2011 and March 31, 2011
those balances were $59,844 and $57,337, respectively.
On September
4, 2011, the Company agreed to extend the due date to
December 4, 2011 under the same terms of the original
note.
|
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