-----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, DxQBm0aBnxnN7L2Qd4CV9Oa9gqUhqj+L8y1NAr1kLUafj6Vgc5ebJfhIRv0fNvOS XrpSNXlDBGEH1jQybnhs1w== 0000921895-97-000352.txt : 19970520 0000921895-97-000352.hdr.sgml : 19970520 ACCESSION NUMBER: 0000921895-97-000352 CONFORMED SUBMISSION TYPE: 10QSB PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970331 FILED AS OF DATE: 19970515 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: TRINITECH SYSTEMS INC CENTRAL INDEX KEY: 0000099047 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 061344888 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10QSB SEC ACT: 1934 Act SEC FILE NUMBER: 001-12292 FILM NUMBER: 97606904 BUSINESS ADDRESS: STREET 1: 333 LUDLOW STREET CITY: STAMFORD STATE: CT ZIP: 06902 BUSINESS PHONE: 2034258000 10QSB 1 QUARTERLY REPORT ON FORM 10QSB ================================================================================ UNITED STATES 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 March 31, 1997 OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ----------- ------------ COMMISSION FILE NO. 0-21324 TRINITECH SYSTEMS, INC. (Exact name of registrant as specified in its charter) NEW YORK 06-1344888 (State of incorporation) (I.R.S. Employer identification number) 333 LUDLOW STREET, STAMFORD, CONNECTICUT 06902 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (203) 425-8000 ------------------------ Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 / / 8,185,030 shares of Common Stock were issued and outstanding as of May 14, 1997. ================================================================================ PART I - FINANCIAL INFORMATION ITEM 1. Financial Statements TRINITECH SYSTEMS, INC. - -------------------------------------------------------------------------------- BALANCE SHEETS - -----------------------
(Unaudited) March 31, December 31, ASSETS 1997 1996 -------------------- -------------------- CURRENT ASSETS: Cash $ 4,479,743 $ 1,198,730 Accounts receivable 2,470,253 3,802,364 Inventories 1,142,946 1,154,187 Prepaid expenses and other 265,824 315,911 ----------- ----------- Total Current Assets 8,358,766 6,471,192 ----------- ----------- EQUIPMENT - net of accumulated depreciation of $461,362 and $417,087 at March 31 and December 31, respectively 518,909 434,638 ----------- ----------- OTHER ASSETS - net of accumulated amortization of $915,221 and $832,652 at March 31 and December 31, respectively 615,166 617,506 ----------- ----------- TOTAL $ 9,492,841 $ 7,523,336 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable - trade $ 583,372 $ 1,386,306 Accrued expenses 321,250 525,653 Current portion of term loan payable 26,210 25,994 Credit line payable -- 745,000 Advance billings 434,986 149,675 Payroll and other taxes payable 66,660 65,808 ----------- ----------- Total Current Liabilities 1,432,478 2,898,436 TERM LOAN PAYABLE 24,427 31,065 ----------- ----------- Total Liabilities 1,456,905 2,929,501 ----------- ----------- COMMITMENTS: STOCKHOLDERS' EQUITY: 10% Convertible preferred stock - par value $1.00; 1,000,000 shares authorized; -0- outstanding -- -- Common stock - par value $.001; 15,000,000 shares authorized 8,180,030 and 7,375,030 shares issued and outstanding in 1997 and 1996, respectively 8,180 7,375 Additional paid-in capital 9,615,670 6,088,975 Accumulated deficit (1,587,914) (1,502,515) ----------- ----------- Total Stockholders' Equity 8,035,936 4,593,835 ----------- ----------- TOTAL $ 9,492,841 $ 7,523,336 =========== ===========
See Notes to Financial Statements. 2 TRINITECH SYSTEMS, INC. - -------------------------------------------------------------------------------- STATMENTS OF OPERATIONS - -----------------------
(Unaudited) --- Three Months Ended --- March 31, March 31, 1997 1996 ------------ ------------ REVENUES: Sales $ 1,576,044 $ 434,002 Service contracts 233,533 169,094 ----------- ----------- Total Revenues 1,809,577 603,096 COST OF SALES AND SERVICE 831,431 319,688 ----------- ----------- GROSS PROFIT 978,146 283,408 ----------- ----------- EXPENSES: Selling, general and administrative 1,041,164 645,349 Depreciation and amortization 47,374 37,867 ----------- ----------- Total Expenses 1,088,538 683,216 ----------- ----------- LOSS FROM OPERATIONS (110,392) (399,808) OTHER INCOME - NET 24,993 17,530 ----------- ----------- NET LOSS ($ 85,399) ($ 382,278) =========== =========== NET LOSS PER COMMON SHARE $ (0.01) $ (0.05) =========== =========== AVERAGE COMMON SHARES OUTSTANDING 7,591,100 7,274,000 =========== ===========
See Notes to Financial Statements. 3 TRINITECH SYSTEMS, INC. - -------------------------------------------------------------------------------- STATEMENTS OF CASH FLOWS - ------------------------
(Unaudited) ---Three Months Ended --- March 31, March 31, 1997 1996 ---------------- --------------- OPERATING ACTIVITIES: Net loss ($ 85,399) ($ 382,278) Adjustments to reconcile net loss to net cash provided by (used in) operating activities: Depreciation and amortization 126,843 106,965 Changes in assets and liabilities: Accounts receivable 1,332,111 450,874 Inventories 11,241 (211,854) Prepaid expenses 50,087 (28,209) Accounts payable - trade (802,934) (3,202) Deferred revenue 285,311 33,833 Payroll and other taxes payable 852 574 Accrued expenses (204,403) (187,076) ----------- ----------- Net cash provided by (used in) operating activities 713,709 (220,373) ----------- ----------- INVESTING ACTIVITIES: Payments for equipment (128,546) (29,694) Payments for other assets (80,228) (82,195) ----------- ----------- Net cash used in investing activities (208,774) (111,889) ----------- ----------- FINANCING ACTIVITIES: Issuance of common stock 3,527,500 4,499 Repayment of borrowings (751,422) (4,167) ----------- ----------- Net cash provided by financing activities 2,776,078 332 ----------- ----------- INCREASE (DECREASE) IN CASH 3,281,013 (331,930) CASH, BEGINNING OF PERIOD 1,198,730 1,258,119 ----------- ----------- CASH, END OF PERIOD $ 4,479,743 $ 926,189 =========== ===========
See Notes to Financial Statements. 4 TRINITECH SYSTEMS, INC. NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - -------------------------------------------------------------------------------- 1. BASIS OF PRESENTATION The accompanying financial statements have been prepared by the Company without audit (except for the balance sheet information as of December 31, 1996 which has been derived from the Company's audited financial statements) in accordance with generally accepted accounting principles for interim financial information and instructions to Form 10-QSB and Item 310 (b) of Regulation S-B. In the opinion of management, all adjustments (consisting of only normal recurring accruals) considered necessary for a fair presentation have been included. The accompanying financial statements do not include certain footnotes and financial presentations normally required under generally accepted accounting principles and, therefore, should be read in conjunction with the Company's 1996 audited financial statements. Results of operations for the period ended March 31, 1997 are not necessarily indicative of operating results for the fiscal year. 2. INVENTORIES Inventories are stated at the lower of cost (first-in, first-out) or market. Inventories consisted of the following: MARCH 31, 1997 DECEMBER 31, 1996 -------------- ----------------- Parts $ 726,417 $ 750,722 Finished goods 416,529 403,465 ---------- ---------- Total $1,142,946 $1,154,187 ========= ========== 3. PER SHARE INFORMATION Net loss per common share is based on the weighted average number of common shares outstanding. Common stock equivalents have not been included in the per share calculation because their effect is anti-dilutive. 5 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS The Company commenced its present business operations in January 1991 through the acquisition of a software license for its Guided-Input(R) Trinitech TouchPad(R) System. The following discussion should be read in conjunction with the consolidated financial statements and related notes included elsewhere herein. Historical results and percentage relationships are not necessarily indicative of the operating results for any future period. REVENUES Revenues for the three months ended March 31, 1997 were $1,809,577 as compared to $603,096 for the three months ended March 31, 1996, an increase of 200%. The increase in revenues during the three months ended March 31, 1997 was principally due to an increase in the delivery of software systems and increased deliveries of the Trinitech TouchPad(R) Systems, primarily 350 units of its touch vending terminal to a non-financial service firm customer. During 1996, the Company delivered 1,750 units of its touch vending terminal to such non-financial service firm customer. The additional delivery of touch vending terminals, during the first quarter of 1997, completes the contractual obligation to such customer. Approximately 36% and 20% of the Company's sales revenues for the periods ended March 31, 1997 and 1996, respectively were derived from software installations. Revenue from export sales approximated $1,221,000 (77% of sales) and $31,000 (7% of sales) during the three months ended March 31, 1997 and 1996, respectively. In addition, revenues from service contracts increased by 38% in the three months ended March 31, 1997 over the comparable 1996 quarter. The increase in service revenue resulted from an increase of equipment in use by customers. Service and maintenance for 1997 and 1996 sales of the Company's touch vending terminal products (2,100 units) will be managed on an actual time and material arrangement. Even though the Company expects its service and maintenance revenue to grow in the financial sector, management does not anticipate receiving any significant future service and maintenance revenue from its 1997 and 1996 sales of touch vending terminal products. The Company did not experience any significant price changes in its product lines during the three month periods ended March 31, 1997 and 1996. COST OF SALES AND SERVICE AND GROSS PROFIT The Company's cost of sales and service is principally comprised of labor, materials overhead and amortization of capitalized product enhancement costs. Gross profit as a percentage of total revenues was 54.1% and 47.0% for the three months ended March 31, 1997 and 1996, respectively. The increase in gross profit in the three months ended March 31, 1997 principally resulted from an increase in the amount of higher margin software installations which 6 was partially offset by lower margins associated with the Company's touch vending terminal products sold during the three months ended March 31, 1997. The Company obtains its materials parts and supplies from a variety of vendors in the US and Far East. During the three months ended March 31, 1997, the Company did not experienced any significant price increases in its component parts purchased. SELLING, GENERAL AND ADMINISTRATIVE Selling, general and administrative expenses for the three months ended March 31, 1997 were $1,041,164 as compared to $645,349 in the three months ended March 31, 1996, an increase of 61%. Such increase reflected the continued expansion of operations in both the US and in London. As a result, the Company experienced increases in salaries and related personnel costs, travel expenses, recruiting fees and various related office expenses. During the past two years, the Company added personnel principally to its technical programming and sales staff. Employees added to technical positions have a primary focus on the customer hardware and software project implementation and development. The Company's recruitment effort, which began during 1993, continues to strengthen the management infrastructure in order to better position the Company to respond to present customers needs as well as for the future. The Company has also continued its marketing programs in 1997, primarily focusing on public relations activities, production of various product brochures, and representation at technological exhibitions planned throughout 1997. Research and development expenses for the three months ended March 31, 1997 and 1996 approximated $61,600 and $64,000, respectively and are included in selling, general and administrative expenses. OTHER INCOME Other income consists principally of interest earned on cash balances and sublease income earned during the three months ended March 31, 1997 and 1996. The Company leases a portion of its corporate office facility under a three year sublease which expired on April 30, 1997. Sublease rental income earned during the three month periods ended March 31, 1997 and 1996 totaled approximately $9,800 and $9,700, respectively. NET LOSS Net loss for the three months ended March 31, 1997 was $85,399 ($0.01 per share) as compared to a net loss of $382,278 ($0.05 per share) in the comparable 1996 period. This improvement in net loss principally resulted from an increase in revenues during the three months period ended March 31, 1997 partially offset by higher selling, general and administrative expenses. See "Revenues" and "Selling, General and Administrative Expenses" above. 7 Management has made a considerable effort with respect to an expansion of its operations, which began in 1993 and continues into 1997. The Company believes that this expansion will better position the Company and facilitate its future growth. However, no assurances can be given that the planned future growth will occur. LIQUIDITY AND CAPITAL RESOURCES Since its formation, the Company's primary source of working capital has been private offerings of its securities, through which the Company has raised approximately $9.6 million of working capital. At March 31, 1997, cash balances increased to $4,479,743 from $1,198,730 at December 31, 1996. The increase is primarily due to the Company completing a private placement of 800,000 shares of Common stock at $4.50 per share on March 7, 1997. The accounts receivable balance at March 31, 1997 principally represents amounts due from customers on sales made during 1996 and 1997. The Company has been continually placing an emphasis on the collection of all outstanding receivables, and believes that all of the balances are fully collectible. The Company's current assets at March 31, 1997 exceeded its current liabilities by approximately $6,926,000. The Company at March 31, 1997 had long-term debt totaling $24,000 which represents a secured term loan on the purchase of development equipment. In addition, at March 31, 1997, the Company had no material commitments for capital expenditures or inventory purchases. The Company had available a one million dollar credit facility for the purpose of financing accounts receivable and, at March 31, 1997, the Company had the full amount of the credit line available. The line of credit, which was secured by accounts receivable and inventory, expired on April 30, 1997. Interest on the line of credit was based on the bank's prime rate plus one percent. The Company anticipates to renew the facility upon substantially similar terms. The Company believes that with its available capital and anticipated funds generated from operations it will be able to fund its cash needs through the end of 1997 without the need for additional capital or financing. The Company intends to utilize its positive financial position to internally finance its continuing research and development activities and anticipated sales growth. The Company's financial requirements and its ability to meet them thereafter will depend largely on its future financial performance. However, in the event the Company's operations do not generate cash to the extent currently anticipated by management of the Company and grow more rapidly than anticipated, it is possible that the Company would require additional funds beyond 1997. At this time, the Company does not know what sources, if any, would be available to it for such funds, if required. In addition, at March 31, 1997, the Company has warrants outstanding for the purchase of 570,837 shares of its Common stock. Assuming the exercise of all such outstanding Warrants, the Company would realize approximately $1,613,000 in gross proceeds. 8 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. Dated: May 14, 1997 TRINITECH SYSTEMS, INC. (Registrant) By: /S/ PETER KILBINGER HANSEN ------------------------------ Peter Kilbinger Hansen Chairman of the Board and President (Chief Executive Officer) By: /S/ WILLIAM E. ALVAREZ, JR. ------------------------------ William E. Alvarez, Jr. Chief Financial Officer and Secretary (Principal Financial and Accounting Officer) 9 EX-27 2 ARTICLE 5 FDS FOR 10-QSB
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE COMPANY'S FORM 10-QSB FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 3-MOS DEC-31-1996 JAN-01-1997 MAR-31-1997 4,479,743 0 2,500,253 30,000 1,142,946 8,358,766 980,271 461,362 9,492,841 1,432,478 0 0 0 8,180 9,615,670 8,035,936 1,576,044 1,809,577 831,431 831,431 0 0 6,276 (85,399) 0 (85,399) 0 0 0 (85,399) (.01) (.01)
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