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 number 0-9255
DENCOR ENERGY COST CONTROLS, INC.
(Exact name of small business issuer as specified in its charter)
Colorado 84-0658020
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1450 West Evans, Denver, Colorado 80223
(Address of principal executive office) (Zip Code)
(303) 922-1888
(Registrant's telephone number, including area code)
Check whether the issuer (1) 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 registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.
Yes X No
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the latest practicable date. No par value per share:
3,671,304 shares issued, at May 1, 1997.
Transitional Small Business Disclosure Format
Yes No X
DENCOR ENERGY COST CONTROLS, INC.
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
(Condensed Balance Sheets)
ASSETS March 31 Dec. 31
1997 1996
(unaudited)
CURRENT ASSETS:
Cash $ 7,500 $ 1,600
Accounts Receivable, net of allowance for
doubtful accounts of $8,500 55,400 58,500
Inventories 132,200 143,600
Prepaids and Other 17,300 8,300
TOTAL CURRENT ASSETS 212,400 212,000
Furniture & Equipment 213,300 213,300
Less Accumulated Depreciation (212,300) (211,300)
1,000 2,000
Other Receivables, net of allowance for
doubtful receivables of $2,300 3,300 3,400
$216,700 $217,400
LIABILITIES & SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes Payable - Shareholders $ 93,400 $ 93,400
Accounts Payable 42,400 33,300
Accrued Compensation and Benefits 25,300 30,600
Accrued Interest - Shareholders 56,500 53,600
Deposits 4,200 9,900
Warranty Reserve 6,300 6,300
Other 1,400 1,600
TOTAL CURRENT LIABILITIES 229,500 228,700
STOCKHOLDERS' EQUITY
Common Stock, no par value, authorized 5,000,000
shares; issued & outstanding, 3,671,304 shares 1,147,600 1,147,600
Deficit (1,160,400) (1,158,900)
Stockholders' Equity (12,800) (11,300)
$ 216,700 $ 217,400
See notes to condensed financial statements
DENCOR ENERGY COST CONTROLS, INC.
STATEMENTS OF OPERATIONS
(unaudited)
Three Months
Ended March 31
1997 1996
REVENUES:
Net Sales $ 113,100 $ 103,700
Interest and Other 1,800 1,900
TOTAL REVENUES 114,900 105,600
COSTS AND EXPENSES;
Cost of Products Sold 54,600 58,800
Selling 6,100 4,400
General and Administrative 33,100 30,800
Research and Development 17,900 18,900
Interest 4,700 4,400
116,400 117,300
NET LOSS $ (1,500) $ (11,700)
NET LOSS PER
COMMON SHARE: $ * $ *
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 3,671,304 3,671,304
*Less than ($.01) per share.
See notes to condensed financial statements
DENCOR ENERGY COST CONTROLS, INC.
STATEMENT OF CASH FLOWS
(unaudited)
Three Months Ended March 31
1997 1996
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (1,500) $ (11,700)
Adjustments to reconcile net loss
to net cash provided by
operating activities:
Depreciation 1,000 1,000
Changes in operating assets and liabilities:
Accounts and other receivables 3,200 14,900
Inventories 11,400 2,600
Other assets (9,000) (6,200)
Accounts payable 9,100 600
Accrued compensation and benefits (5,300) (5,000)
Accrued interest - shareholders 2,900 4,400
Deposits (5,700)
Other liabilities (200) (300)
Total adjustments 7,400 12,000
Net cash provided by (used in) operating 5,900 300
activies
CASH, beginning of year 1,600 3,800
CASH, end of quarter $ 7,500 $ 4,100
See notes to condensed financial statements
DENCOR ENERGY COST CONTROLS, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
A. The condensed Financial Statements included herein have been prepared by
the Company, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such rules and regulations, although the Company believes that the
disclosures are adequate to make the information presented not misleading.
In the opinion of the Company, all accompanying unaudited condensed
Financial Statements contain all adjustments, which consist only of recurring
adjustments, necessary to present fairly the financial position as of March 31,
1997, and the results of operations and cash flows for the three months ended
March 31, 1997 and 1996.
The results of operations for the three-month periods ended March 31, 1997
and 1996, are not necessarily indicative of the results to be expected for the
full year. It is suggested that these Condensed Financial Statements be read in
conjunction with the Financial Statements and the notes therein included in
the Company's latest annual report on Form 10-KSB.
B. Long-Term Debt:
As of the end of First Quarter, 1997, the Company had no long-term debt.
C. Common Stock:
During the First Quarter, 1997, the Company sold no restricted stock.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
NET SALES
First Quarter sales of $113,100 were approximately 9% greater than the $103,700
for the comparable period in 1996. The increase is primarily a result of a
increase in sales to dealers.
COST AND EXPENSE
Cost of Products Sold as a percentage of net sales decreased 8.4% for the first
quarter of 1997 compared with the same period in the prior year. This increase
in gross margin is primarily due to a increase in the percentage of sales to
dealers. Dealer sales have a greater margin than utility sales.
Selling expenses as a percentage of net sales for the first quarter of 1997
increased 1.2% compared to the prior year. The increase was primarily due to
increased travel expense.
General and Administrative expenses for the first quarter 1997 were essentially
the same as for the same period in the prior year.
DENCOR ENERGY COST CONTROLS, INC.
Research and Development expenses as a percentage of net sales decreased
slightly from the same quarter in the prior year.
EARNINGS
The net loss for the first quarter was $1,500 compared to a net loss of
$11,700 for the same period in the prior year. The decrease in net loss was
primarily due to the decrease in cost of goods sold as a percentage of sales.
LIQUIDITY
The Independent Auditor's Report on Dencor Energy Cost Controls, Inc. Financial
Statements for the year ended December 31, 1996 included a "going concern"
explanatory paragraph which means that the Auditors have expressed substantial
doubt about the Company's ability to continue as a going concern. Management's
plans in regards to the factors which prompted the explanatory paragraph are
discussed in Note 2 to the Company's December 31, 1996 Financial Statements.
The Company's current ratio is 0.91 at the Quarter ended March 31, 1997.
Management believes the acid ratio (cash and accounts receivable divided by
current liabilities) of 0.26 is within the limits of reasonable liquidity.
PART II - OTHER INFORMATION
Items 1 through 5 would appear to require no answers according to the
instructions.
Item 6. Exhibits And Reports On Form 8-K
(a) The following Exhibit is filed as part of this Quarterly Report on Form
10-Q: 27. Financial Data Schedule.
(b) During the quarter ended March 31, 1997, the Registrant did not file
any reports on Form 8-K.
SIGNATURE
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.
DENCOR ENERGY COST CONTROLS, INC.
Registrant
By: Maynard L. Moe
President and Principal Accounting Officer
Date: May 8, 1997