United StatesSECURITIES AND EXCHANGE COMMISSIONWashington, DC 20549FORM 10-QSBQuarterly Report Pursuant to Section 13 or 15(d)of the Securities Exchange Act of 1934 |
For Quarter Ended November 30, 2000 | Commission File Number 0-16101 |
INOTEK Technologies Corp. |
Delaware (State or other jurisdiction of incorporation or organization) | 75-1986151 (I.R.S. Employer Identification No.) |
11212 Indian Trail, Dallas, Texas (Address of principal executive offices) | 75229 (Zip Code) |
Registrant’s telephone number including area code, 972-243-7000. Not Applicable 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 ___ 4,854,088 shares of common stock, $.01 par value (the issuer’s only class of common stock), were outstanding as of November 30, 2000. |
INOTEK Technologies Corp.INDEX |
Page No. | |||
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Part I. Financial Information | |||
Item 1. Financial Statements: | |||
Balance Sheets as of November 30, 2000 (unaudited) and May 31, 2000 | 1 | ||
Statements of Operations for the Three Months Ended November 30, 2000 | |||
and November 30, 1999 (unaudited) | 2 | ||
Statements of Operations for the Six Months Ended November 30, 2000 | |||
and November 30, 1999 (unaudited) | 3 | ||
Statements of Cash Flows for the Six Months Ended November 30, 2000 | |||
and November 30, 1999 (unaudited) | 4 | ||
Notes to Financial Statements | 5 | ||
Item 2. Management’s Discussion and Analysis of Financial | |||
Condition and Results of Operations | 6 | ||
Part II. Other Information | |||
Item 1. Legal Proceedings | 7 | ||
Item 4. Submission of Matters to a Vote of Security Holders | 7 | ||
Item 6. Exhibits and Reports on Form 8-K | 7 | ||
Signatures | 8 | ||
Index to Exhibits | |||
Exhibit (20)-Report Furnished to Security Holders | 9 |
INOTEK Technologies Corp.Balance Sheets |
November 30 2000 (unaudited) | May 31 2000 | ||||
---|---|---|---|---|---|
ASSETS | |||||
Current assets: | |||||
Cash and cash equivalents | $ 485,469 | $ 632,970 | |||
Trade receivables, net of allowance for doubtful accounts | |||||
of $116,341 at November 30 and $111,837 at May 31 | 2,209,122 | 2,336,758 | |||
Inventories | 1,237,450 | 1,247,903 | |||
Deferred taxes | 75,241 | 89,028 | |||
Income tax receivable | 118,771 | 74,899 | |||
Prepaid expenses and other assets | 156,479 | 156,314 | |||
Total current assets | 4,282,532 | 4,537,872 | |||
Property and equipment, net | 805,657 | 801,553 | |||
Goodwill, net of accumulated amortization of $749,114 at | |||||
November 30 and $716,157 at May 31 | 1,892,839 | 1,925,795 | |||
Other assets | 46,343 | 63,332 | |||
Total assets | $ 7,027,371 | $ 7,328,552 | |||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||
Current liabilities: | |||||
Accounts payable | $ 1,212,197 | $ 1,281,474 | |||
Accrued expenses | 281,522 | 308,374 | |||
Total current liabilities | 1,493,719 | 1,589,848 | |||
Deferred tax liability | 25,704 | 38,191 | |||
Shareholders’ equity: | |||||
Common shares, $.01 par value: | |||||
Authorized shares, 10,000,000 | |||||
Issued and Outstanding shares | |||||
4,854,088 at November 30 and 4,604,088 May 31 | 48,541 | 46,041 | |||
Additional paid-in-capital | 3,434,547 | 3,367,046 | |||
Retained earnings | 2,064,240 | 2,326,806 | |||
Total shareholders’ equity | 5,547,328 | 5,739,893 | |||
Less: Common stock in treasury at cost, 100,000 shares in 1999 | (39,380 | ) | (39,380 | ) | |
Total Shareholders’ equity | $ 5,507,948 | $ 5,700,513 | |||
Total Liabilities and Shareholders’ Equity | $ 7,027,371 | $ 7,328,552 | |||
See accompanying notes |
INOTEK Technologies Corp.Statements of Operations(unaudited) |
Three Months Ended | |||||
---|---|---|---|---|---|
November 30 2000 | November 30 1999 | ||||
Net sales | $ 4,353,790 | $ 5,198,049 | |||
Cost of goods sold: | 3,298,902 | 3,945,632 | |||
Gross margin | 1,054,888 | 1,252,417 | |||
Operating expenses: | |||||
Sales and marketing | 667,510 | 711,311 | |||
General and administrative | 662,656 | 576,795 | |||
1,330,166 | 1,288,106 | ||||
Operating loss | (275,278 | ) | (35,689 | ) | |
Interest income | 13,399 | — | |||
Loss before income taxes | (261,879 | ) | (35,689 | ) | |
Income tax benefit | (31,121 | ) | (13,067 | ) | |
Net loss | $ (230,758 | ) | $ (22,622 | ) | |
Net loss per share - basic and diluted | $ (.05 | ) | $ (.05 | ) | |
Weighted average shares outstanding | 4,612,240 | 4,392,131 | |||
See accompanying notes |
INOTEK Technologies Corp.Statements of Operation(unaudited) |
Six Months Ended | |||||
---|---|---|---|---|---|
November 30 2000 | November 30 1999 | ||||
Net sales | $ 9,173,415 | $ 9,486,168 | |||
Cost of goods sold: | 6,913,478 | 7,204,756 | |||
Gross margin | 2,259,937 | 2,281,412 | |||
Operating expenses: | |||||
Sales and marketing | 1,391,933 | 1,439,062 | |||
General and administrative | 1,196,188 | 1,145,262 | |||
2,588,121 | 2,584,324 | ||||
Operating loss | (328,184 | ) | (302,912 | ) | |
Interest income | (27,093 | ) | 4,837 | ||
Loss before income taxes | (301,091 | ) | (298,075 | ) | |
Income tax benefit | (38,648 | ) | (62,207 | ) | |
Net loss | $ (262,443 | ) | $ (235,868 | ) | |
Net loss per share - basic and diluted | $ (.06 | ) | $ (.05 | ) | |
Weighted average shares outstanding | 4,612,240 | 4,392,131 | |||
See accompanying notes |
INOTEK Technologies Corp.Statements of Cash Flows(unaudited) |
Six Months Ended November 30 | |||||
---|---|---|---|---|---|
2000 | 1999 | ||||
Operating Activities | |||||
Net loss | $(262,443 | ) | $(235,868 | ) | |
Adjustments to reconcile net loss | |||||
to net cash provided by (used in) operating activities: | |||||
Depreciation and amortization | 162,749 | 140,554 | |||
Deferred taxes | 1,300 | (38,016 | ) | ||
Provision for losses on accounts receivable | 4,505 | 28,262 | |||
Net changes in operating assets and liabilities: | |||||
Accounts receivable | 123,132 | (754,752 | ) | ||
Inventories | 10,453 | 461 | |||
Prepaid expenses and other assets | (165 | ) | (120,687 | ) | |
Accounts payable | (69,404 | ) | 795,011 | ||
Accrued expenses | (26,852 | ) | (41,251 | ) | |
Income tax receivable | (43,872 | ) | 47,297 | ||
Increase in other assets | 14,703 | — | |||
Net cash provided by (used in) operating activities | (85,894 | ) | (178,989 | ) | |
Investing Activities | |||||
Purchase of property and equipment | (131,607 | ) | (58,346 | ) | |
Purchase of other assets | — | (6,333 | ) | ||
Net cash used in investing activities | (131,607 | ) | (64,679 | ) | |
Financing Activities | |||||
Exercise of warrants | 70,000 | 70,000 | |||
Net cash used in financing activities | 70,000 | 70,000 | |||
Change in cash and cash equivalents | (147,501 | ) | (173,668 | ) | |
Cash and cash equivalents, beginning of period | 632,970 | 173,668 | |||
Cash and cash equivalents, end of period | $ 485,469 | $ -- | |||
Supplemental Disclosures of Cash Flow Information: | |||||
Cash received during the period for: | |||||
Interest | $ 27,093 | $ 4,837 |
See accompanying notes |
INOTEK Technologies Corp. |
1. | Basis of Presentation |
The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-QSB and applicable SEC Rules and Regulations. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary for a fair presentation of the results for the interim periods presented have been made. The results of operations for such interim periods are not necessarily indicative of the results of operations for a full year. The interim unaudited financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ended May 31, 2000. |
2. | Long-term debt |
On September 15, 2000, the Company secured a new agreement with Bank One, Texas, N.A. for a one-year revolving credit arrangement of up to $500,000. The credit arrangement provides for borrowings based on the Company’s trade receivables, at the bank’s prime rate plus one percent and is collateralized by trade receivables and inventories. |
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Part II - Other InformationItem 1. Legal ProceedingsNone pending Item 4. Submission of Matters to a Vote of Security HoldersNone Item 6. Exhibits and Reports on Form 8-K |
(a) | Exhibits: |
1. Exhibit (20)-Report furnished to security holders. |
(b) | Reports on 8-K: |
No reports on Form 8-K were filed in the quarter for which this report is filed. |
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SignaturesPursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. |
INOTEK Technologies Corp. (Registrant) |
Date: January 15, 2001 | /s/ Neal E. Young —————————————— (Officer) Neal E. Young Chairman of the board |
Date: January 15, 2001 | /s/ Dennis W. Stone —————————————— (Officer) Dennis W. Stone Chief Executive Officer |
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