SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[x] QUARTERLY REPORT
PURSUANT TO SECTION 13
OR 15(d) OF THE
SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended June 30, 2005
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File No. 2-70197
OCEAN BIO-CHEM, INC.
-------------------------------------
(Exact name of Registrant as specified in its charter)
Florida 59-1564329
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4041 SW 47 Avenue, Fort Lauderdale, Florida 33314-4023
954-587-6280
-------------------------------------
(Address and telephone number, including area code of
Registrant's Principal Executive Offices)
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Common stock, par value $.01 per share
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Sections 12, 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 [ ]
Indicate by check mark whether the Registrant is an accelerated filer (as
defined by Rule 12b-2 of the Securities Exchange Act of 1934)
YES [ ] NO [x]
Indicate the number of shares outstanding of each of the Issuer's classes
of common stock as of the latest practicable date
$.01 par value common stock, 10,000,000 shares authorized,
5,689,816 shares issued and outstanding at July 31, 2005
OCEAN BIO-CHEM, INC. AND SUBSIDIARIES
INDEX
Description Page
----------- ----
Part I:
Item 1. - Financial Statements:
Consolidated balance sheets as of June
30, 2005 and December 31, 2004 3
Consolidated statements of operations for
the three and six months ended June 30,
2005 and 2004 4
Consolidated statements of changes in
shareholders' equity for the six months
ended June 30, 2005 and 2004 5
Consolidated statements of cash flows
for the six months ended June 30, 2005
and 2004 6
Item 2. - Management's Discussion and Analysis of
Financial Condition and Results of Operations 7-9
Item 3. - Quantitative and Qualitative Disclosures about
Market Risk 9
Item 4. Controls and Procedures 9
Part II:
Item 1. - Legal Proceedings 10
Item 2. - Unregistered Sales of Equity Securities and Use
of Proceeds 10
Item 3. - Defaults upon Senior Securities 10
Item 4. - Submission of Matters to Vote by Security Holders 10
Item 5. - Other Matters 11
Item 6. - Exhibits 11
Signatures 11
Exhibits
2
PART I - Financial Information
Item l. Financial Statements
OCEAN BIO-CHEM, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
JUNE 30, DECEMBER 31,
2005 2004
------------- -------------
(Unaudited)
Current assets:
Cash $ 25,916 $ 988,106
Trade accounts receivable net of
allowances for doubtful accounts
of approximately $116,880 and $201,000
at June 30, 2005 and December 31, 2004,
respectively 3,289,679 4,652,144
Inventories 7,119,630 5,218,431
Recoverable income taxes 274,500 -
Prepaid expenses and other current assets 161,998 214,492
----------- -----------
Total current assets 10,871,723 11,073,173
----------- -----------
Property, plant and equipment, net 7,510,305 7,337,600
----------- -----------
Other assets:
Funds held in escrow for equipment 1,870 1,853
Trademarks, trade names and patents, net
of accumulated amortization 330,439 330,439
Due from affiliated companies, net 196,217 408,476
Deposits and other assets 251,728 246,803
----------- -----------
Total other assets 780,254 987,571
----------- -----------
Total assets $19,162,282 $19,398,344
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable - trade $ 2,215,900 $ 2,251,287
Note payable - bank 4,900,000 4,500,000
Current portion of long-term debt 587,199 483,112
Accrued expenses and income taxes payable 353,576 435,200
----------- -----------
Total current liabilities 8,056,675 7,669,599
----------- -----------
Deferred income taxes payable 260,000 260,000
----------- -----------
Long-term debt, less current portion 5,743,168 5,580,250
----------- -----------
Shareholders' equity:
Common stock - $.01 par value 10,000,000
shares authorized, 5,689,816 and 5,417,813
shares issued and outstanding at June 30,
2005 and December 31, 2004, respectively 56,898 54,178
Additional paid-in capital 4,817,291 4,722,746
Foreign currency translation adjustment ( 200,743) ( 204,864)
Retained earnings 437,188 1,324,630
----------- -----------
5,110,634 5,896,690
Less cost of common stock in treasury,
7,519 shares at June 30, 2005 and
December 31, 2004, respectively ( 8,195) ( 8,195)
----------- -----------
5,102,439 5,888,495
----------- -----------
Total liabilities and shareholders' equity $19,162,282 $19,398,344
=========== ===========
3
OCEAN BIO-CHEM, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
FOR THE THREE MONTHS FOR THE SIX MONTHS
ENDED JUNE 30, ENDED JUNE 30,
2005 2004 2005 2004
--------- -------- -------- -----------
Gross sales $ 5,148,807 $ 6,295,436 $ 8,626,318 $10,199,380
Allowances 561,692 849,875 943,425 1,316,233
------------ ------------ ------------ ------------
Net sales 4,587,115 5,445,561 7,682,893 8,883,147
Cost of goods sold 3,264,677 4,052.441 6,005,181 6,743,078
------------ ------------ ------------ ------------
Gross profit 1,322,438 1,393,120 1,677,712 2,140,069
------------ ------------ ------------ ------------ -
Costs and expenses:
Advertising and promotion 564,997 333,174 671,403 467,430
Selling and administrative 955,570 864,748 1,966,540 1,722,151
Interest expense 107,539 73,639 211,471 140,942
------------ ------------ ------------ ------------
Total cost and expenses 1,628,106 1,271,561 2,849,414 2,330,523
------------ ------------ ------------ ------------
Income (loss) from operations ( 305,668) 121,559 ( 1,171,702) ( 190,454)
Interest and other income 8,941 107 9,760 579
------------ ------------ ------------ ------------
Income (loss) before income
taxes ( 296,727) 121,666 ( 1,161,942) ( 189,875)
Provision (benefit) for income
taxes 19,500 59,500 ( 274,500) ( 46,500)
------------ ------------ ------------ ------------
Net income (loss) ( 316,227) 62,166 ( 887,442) ( 143,375)
Other comprehensive income
(loss) net of income taxes:
Foreign currency translation
Adjustment ( 2,362) ( 16,559) 4,121 ( 12,021)
------------ ------------ ------------ ------------
Comprehensive income (loss) ($ 318,589) $ 45,607 ($ 883,321) ($ 155,396)
============ ============ ============ ============
Earnings (loss) per
common share ($.06) $.01 ($.16) ($.03)
============ ============ ============ ============
Earnings per share were calculated on the basis of 5,578,815 and 5,294,818
weighted average shares of common stock outstanding for the six months and three
months ended June 30, 2005 and 2004, respectively.
The Company has adopted Statement of Financial Accounting Standards No. 130
that requires items of comprehensive income to be stated as part of the basic
financial statements. The only items of comprehensive income that the Registrant
has are its foreign currency translation adjustments.
4
OCEAN BIO-CHEM, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES
IN SHAREHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED
JUNE 30, 2005 AND 2004
(UNAUDITED)
Additional Foreign
Common stock paid-in currency Retained Treasury
Shares Amount capital adjustment earnings stock Total
--------- ------- ---------- ---------- ---------- -------- ----------
January 1,
2005 5,417,813 $54,178 $4,722,746 ($204,864) $1,324,630 ($8,195) $5,888,495
Net loss ( 887,442) ( 887,442)
Common stock
issuances 272,003 2,720 94,545 97,265
Foreign currency
translation
adjustment 4,121 4,121
--------- ------- ---------- --------- ---------- -------- -----------
June 30,
2005 5,689,816 $56,898 $4,817,291 ($200,743) $437,188 ($8,195) $5,102,439
========= ======= ========== ========== ========== ======== ============
January 1,
2004 4,960,843 $49,608 $4,409,829 ($237,323) $1,190,076 ($ 8,195) $5,403,995
Net (loss) ( 143,375) ( 143,375)
Common stock
issuances 456,970 4,570 312,917 317,487
Foreign currency
translation
adjustment ( 12,021) ( 12,021)
--------- ------- ---------- --------- ---------- -------- ----------
June 30,
2004 5,417,813 $54,178 $4,722,746 ($249,344) $1,046,701 ($ 8,195) $5,566,086
========= ======= ========== ========== ========== ========= ==========
5
OCEAN BIO-CHEM, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30,
(Unaudited)
2005 2004
----------- ------------
Cash flow used by operating activities:
Net (loss) ($ 887,442) ($ 143,375)
Adjustments to reconcile net loss to net cash used
by operations:
Depreciation and amortization 368,589 357,224
Changes in assets and liabilities:
Decrease (increase) in accounts receivable 1,362,465 ( 101,652)
(Increase) in inventory ( 1,901,199) ( 1,030,805)
(Increase) decrease in prepaid expenses
and other current assets ( 222,004) 25,465
(Decrease) in accounts payable,
accrued expenses and other ( 121,954) 634,133
------------ -------------
Net cash provided (used) by operating activities ( 1,401,545) ( 259,010)
------------ -------------
Cash flows from financing activities:
Net increases under line of credit 400,000 775,000
Reduction (increases) in due from affiliates 212,259 ( 183,313)
Additions to long term debt, net 500,000 -
Payments on long term debt, net ( 232,996) ( 283,659)
Common stock transactions 97,265 317,487
------------ -------------
Net cash provided by financing activities 976,528 625,515
------------ -------------
Cash flows used by investing activities:
Purchases of property, plant, equipment, net
of funds held in escrow ( 541,294) ( 178,966)
------------ -------------
Net cash used by investing activities ( 541,294) ( 178,966)
------------ -------------
Increase (decrease) in cash prior to effect of
foreign currency translation adjustment ( 966,311) 187,539
Effect of foreign currency translation adjustment on cash 4,121 ( 12,021)
------------ -------------
Net increase (decrease) in cash ( 962,190) 175,518
Cash at beginning of period 988,106 42,923
------------ -------------
Cash at end of period $ 25,916 $ 218,441
============ =============
Supplemental information:
Cash used for payment of interest during period $ 211,473 $ 140,942
============ =============
Cash used for payment of income taxes during period $ 110,734 $ 32,000
============ =============
The company had no cash equivalents at June 30, 2005 and 2004
6
OCEAN BIO-CHEM, INC.
AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. The information contained in this report is unaudited, but reflects all
adjustments that are, in the opinion of the management, necessary for a fair
statement of results of the interim periods, consisting only of normal recurring
accruals. The results for such interim periods are not necessarily indicative of
results to be expected for the full year.
Certain financial statement items for the three and six months ended June
30, 2004 have been reclassified to conform with the 2005 presentation.
Forward-looking Statements:
Certain statements contained herein, including without limitation
expectations as to future sales and operating results, constitute
forward-looking statements pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. For this purpose, any statements
contained in this report that are not statements of historical fact may be
deemed forward-looking statements. Without limiting the generality of the
foregoing, words such as "may", "will", "expect", "anticipate", "intend",
"could" or the negative other variations thereof or comparable terminology are
intended to identify forward-looking statements. These statements involve known
and unknown risks, uncertainties and other factors which may cause actual
results, performance or achievements of Ocean Bio-Chem, Inc. (the "Company,"
`we" or "us") to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements. Factors
which may affect our results include, but are not limited to, the highly
competitive nature of our industry; reliance on certain key customers; consumer
demand for marine, recreational vehicle and automotive products; advertising and
promotional efforts, and other factors. We will not undertake and specifically
decline any obligation to update or correct any forward-looking statements to
reflect events or circumstances after the date of such statements or to reflect
the occurrence of anticipated or unanticipated events.
Item 2 Management's Discussion and Analysis of Financial Condition and Results
of Operations
Liquidity and Capital Resources
The primary sources of our liquidity and capital resources are operations,
short-term borrowings under our revolving line of credit with Regions Bank, a
commercial bank, and other borrowings.
We renewed our $6 million working capital line of credit with Regions Bank
on May 25, 2005. This line of credit is secured by a security interest in our
accounts receivable and inventory. The line of credit bears interest based on
the 30 day LIBOR rate plus 275 basis points (approximately 5.86% at June 30,
2005) and matures on May 31, 2006. The maximum amount of credit that can be
extended under the agreement is $6 million. Under this line of credit, we are
required to maintain certain financial ratios as of each fiscal year end. As of
June 30, 2005, the amount outstanding pursuant to the working capital line of
credit was $4,900,000.
We have obtained financing under two separate series of industrial
development revenue bonds from the city of Montgomery, AL in 1997 and 2002. As
of June 30, 2005, the amount outstanding under our industrial development
revenue bonds aggregated $5,435,000. The interest rate on the bonds is a
floating rate and as of June 30, 2005, the interest rate was approximately 2.6%.
On April 12, 2005 we entered into a financing obligation with Regions Bank
whereby they advanced us $500,000 to finance equipment acquisitions at our
Kinpak facility. Such obligation is due in monthly installments of principal
aggregating $8,333 plus interest at prevailing rates (the initial interest rate
on this obligation was 5.4% per annum) through maturity on April 15, 2010.
As disclosed in our Form 10-Q for the quarter ended March 31, 2005, our
largest customer has publicly announced their adoption of a policy to reduce
their overall inventory levels. The impact of this was reflected in our reduced
sales during the first two quarters of 2005. Our products historically sell well
at the retail level and we expect that once they reach their inventory goals,
our recurring sales levels will resume. Our Chairman and CEO has offered to
advance funds to the Company aggregating from $1 million to 1.5 million in order
to bolster working capital during this, what we believe to be, a temporary
period of adjustment. We expect this arrangement to be effective during the
upcoming quarter and once finalized appropriate public disclosures will be made.
As of June 30, 2005, we do not have any material commitments for capital
expenditures, nor do we have any other present commitment that is likely to
result in our liquidity increasing or decreasing in any material way. In
addition, except for our need for additional capital to finance inventory
purchases, we know of no trend, additional demand, event or uncertainty that
will result in, or that is reasonably likely to result in, our liquidity
increasing or decreasing in any material way.
7
Results of Operations For The Three Months Ended June 30, 2005 compared to the
Three Months ended June 30, 2004
Net sales decreased 15.8% to approximately $4,587,1000 for the three months
ended June 30, 2005 compared to net sales of approximately $5,445,600 for the
three months ended June 30, 2004. Management attributes such decrease
significantly to our largest customer adopting a policy of reducing their
inventory levels coupled with the unusually cold weather in various regions of
our country resulting in the consequential delay in the start of the 2005
recreational boating season.
Cost of goods sold decreased to 71.2 % of net sales during the three months
ended June 30, 2005 compared to 74.4% of net sales in the three months ended
June 30, 2004. The decrease in the cost of goods is attributed in part to a
sales price increase passed along to our customers in response to increasing
costs in petroleum related products and other raw materials and plant labor
costs.
Selling and administrative expenses increased approximately $90,800 or
10.5% in the three months ended June 30, 2005 compared to the same period in the
prior year. Such change was primarily due to increased personnel costs and other
normal recurring increases in operating expenses.
Advertising and promotion increased approximately $231,800 or 69.6% in the
three months ended June 30, 2005 compared to the same period in the prior year.
This resulted primarily from planned increases in media and co-op advertising
programs for the current year.
Interest expense increased by $33,900 or 46% comparing the three months
ended June 30, 2005 and 2004. This resulted from increasing interest rates and a
new term loan covering equipment acquisitions at our manufacturing facility.
Our loss from operations was approximately $305,700 for the three months
ended June 30, 2005 compared to income of approximately $121,600 during the
three months ended June 30, 2004.
Our net loss was approximately $316,200 for the three months ended June 30,
2005 compared to income of $62,200 during the three months ended June 30, 2004.
Six Months Ended June 30, 2005 Compared To The Six Months Ended June 30, 2004
Net sales decreased 13.5% to approximately $7,682,900 for the six months
ended June 30, 2005 compared to approximately $8,883,100 for the six months
ended June 30, 2004. Management attributes such decrease significantly to our
largest customer adopting a policy of reducing their inventory levels coupled
with the unusually cold weather in various regions of our country resulting in
the consequential delay in the start of the 2005 recreational boating season.
Cost of goods sold increased to 78.2% of net sales for the six months ended
June 30, 2005 compared to 75.9% of net sales for the six months ended June 30,
2004. This change resulted principally during the quarter ended March 31, 2005
and was attributed to increasing materials costs of petroleum related products
which are significantly consumed in the production of our products. In an
attempt to offset the foregoing, during May 2005, we announced a substantially
"across the board" sales price increase to our customers in the 8% - 10% range
effective June 1, 2005. The impact of this strategy had a modest impact in this
quarter. However, we expect that its full impact will be realized in the
upcoming quarters of 2005 and thereafter.
Advertising and promotion expenses increased approximately $204,000 or
43.6% for the 2005 period when compared to comparable expenses in the same time
period in the previous year. This resulted primarily from planned increases in
media and co-op advertising programs for the current year.
Selling and administrative expenses increased by approximately $244,400 or
14.2 % for the six months ended June 30, 2005 compared to the six months ended
June 30, 2004. Such change was primarily due to increased personnel costs and
other normal recurring increases in operating expenses.
Interest expense for the 2005 period increased approximately $70,500 or 50%
when compared to the same six month period of 2004. This resulted from
increasing interest rates and a new term loan covering equipment acquisitions at
our manufacturing facility.
Our loss before income taxes was approximately $1,162,000 for the six
months ended June 30, 2005 compared to approximately $189,900 for the six months
ended June 30, 2004.
8
Our estimated benefit from income taxes amounted to approximately $274,500
for the six months ended June 30, 2005, and reflects available tax net loss
carry-back provisions based on the interim operations of the Company. The
comparable amount for the six months ended June 30, 2004 was approximately
$46,500.
As a result of the foregoing, our net loss from amounted to approximately
$887,400 for the six months ended June 30, 2005 compared to a net loss of
approximately $143,400 for the six months ended June 30, 2004.
Item 3. Quantitative And Qualitative Disclosures About Market Risk
Market risk represents the risk of loss that may impact our financial
position, results of operations or cash flows due to adverse changes in
financial and commodity market prices and interest rates. We are exposed to
market risk in the areas of changes in borrowing rates in the United States and
changes in foreign currency exchange rates Historically, and as of June 30,
2005, we have not used derivative instruments or engaged in hedging activities
to minimize market risk.
INTEREST RATE RISK
As or June 30, 2005, we had floating interest rates on our industrial
development revenue bonds and our credit facilities. As of June 30, 2005, the
interest rate on our $ 5,435,000 outstanding balance of industrial revenue bonds
was approximately 2.6% per annum and the interest rate on our line of credit
facility's outstanding balance of $4,900,000 as of June 30, 2005 approximated
5.86%, which is based on the 30 day LIBOR rate plus 275 basis points. Our
remaining debt obligations aggregating approximately $895,300 bear interest at
rates approximating 6%. We do not expect any changes in interest rates to have a
significant impact on our operations during fiscal 2005.
FOREIGN CURRENCY RISK
We sell products in Canada, based on the Canadian dollar. Thereby, we have
exposure to changes in exchange rates. Changes in the Canadian dollar/U.S.
dollar exchange rates may positively or negatively affect our gross margins,
operating income and retained earnings. We do not believe that near-term changes
in the exchange rates, if any, will result in a material effect on our future
earnings, fair values or cash flows, and therefore, we have chosen not to enter
into foreign currency hedging transactions. We cannot be assured that this
approach will be successful, especially in the event of a significant and sudden
change in the value of the Canadian dollar.
CONCENTRATION AND CREDIT RISK
We maintain cash balances at several financial institutions that are
insured by the Federal Deposit Insurance Corporation up to $100,000. At times,
our cash balances may exceed federally insured limits. We have not experienced
any losses in such accounts and we believe the risk related to these deposits is
minimal. At June 30, 2005, none of the Company's cash was subject to such risk.
Financial instruments that potentially subject the Company to concentration
of credit risk consist primarily of accounts receivable. Our five largest
customers represented approximately 55%, of consolidated gross revenues for the
years ended December 31, 2004 and 2003; and 77% and 76% of consolidated accounts
receivable at December 31, 2004 and 2003, respectively. We have had a
longstanding relationship with each of these entities and have always collected
open receivable balances. However, the loss of any of these customers could have
an adverse impact on our operations.
RAW MATERIAL COMMODITY RISK
Many of the raw materials that we use in the manufacturing process are
commodities that are subject to fluctuating prices. We react to long-term
increases by passing along all or a portion of such increases to our customers
as competitive conditions permit.
Item 4. Controls And Procedures
Within 90 days prior to the date of this Quarterly Report on Form 10-Q, we
carried out an evaluation, under the supervision and with the participation of
our principal executive officer and principal financial officer, of the
effectiveness of the design and operation of our disclosure controls and
procedures. Based on this evaluation, our principal executive officer and
principal financial officer concluded that our disclosure controls and
procedures are effective in timely alerting them to material information
required to be included in our periodic SEC reports. It should be noted that the
design of any system of controls is based in part upon certain assumptions about
the likelihood of future events, and there can be no assurance that any design
will succeed in achieving its stated goals under all potential future conditions
9
regardless of how remote. In addition, we reviewed our internal controls, and
there have been no significant changes in our internal controls or in other
factors that could significantly affect those controls subsequent to the date of
their last evaluation.
During the most recent fiscal quarter, there has not occurred any change in
our internal control over financial reporting that has materially affected, or
is reasonably likely to materially affect, our internal control over financial
reporting.
PART II: OTHER INFORMATION
Item l - Legal Proceedings:
We are not a party to any material litigation presently pending nor, to the
best knowledge of the Company, have any such proceedings been threatened.
Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds:
During April 2005, we issued 122,000 shares of Company's authorized, but
previously unissued shares to approximately twelve employees of the Company as
compensation in lieu cash payments. The issuance of the shares was exempt from
registration under the Securities Act of 1933 in reliance on Section 4(2)
promulgated thereunder as a transaction not involving any public offering. Our
shareholders ratified this transaction at our June 1, 2005 Annual Meeting.
Item 3 - Defaults Upon Senior Securities: Not applicable
Item 4 - Submission of Matters to Vote of Security Holders:
On June 1, 2005, at our annual meeting of shareholders, seven directors;
Peter G. Dornau, Edward Anchel, Jeffrey J. Tieger, Laz L. Schneider, James M.
Kolisch, John B. Turner, and Sonia B. Beard were elected, shareholders ratified
issuances of restricted common stock to certain employees, shareholders ratified
the modification of certain stock options previously granted and shareholders
approved Levi, Cahlin & Company, Certified Public Accountants, as independent
auditors for the year ending December 31, 2005. The tabulation of voting for the
foregoing was as follows:
For Against
--------- --------
Peter G. Dornau 4,668,999 1,150
Edward Anchel 4,659,104 11,045
Jeffrey J. Tieger 4,669,249 900
Laz L. Schneider 4,669,249 900
James M. Kolisch 4,669,018 1,131
John B. Turner 4,670,149 -
Sonia B. Beard 4,660,023 10,126
Ratification of issuances
of restricted common
stock 2,879,214 24,487
Ratification of modifications
to previously issued stock
options 2,877,059 25,842
Levi, Cahlin and
Company, CPA's 2,818,489 1,778
10
Item 5 - Other Matters: Not applicable
Item 6 - Exhibits:
31.1 Certification of CEO pursuant to Section 302 of
Sarbanes Oxley Act of 2002
31.2 Certification of CFO pursuant to Section 302 of
Sarbanes Oxley Act of 2002
32.1 Certification of CEO and CFO pursuant to USC Section
1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 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.
OCEAN BIO-CHEM, INC.
Date: August 12, 2005 /s/ Peter Dornau
----------------------------------------
Peter G. Dornau
Chairman of the Board and
Chief Executive Officer
/s/ Edward Anchel
----------------------------------------
Edward Anchel
Chief Financial Officer
11
EXHIBIT 31.1
CERTIFICATION
I, Peter Dornau certify that:
1. I have reviewed this quarterly report on Form 10-Q of Ocean Bio-Chem,
Inc. as of and for the periods ended June 30, 2005;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the periods covered by this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the Registrant as
of, and for, the periods presented in this report;
4. The Registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a - 15(e) and 15d - 15(e)) for the Registrant and have:
a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the Registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this quarterly report is being prepared;
b) Evaluated the effectiveness of the Registrant's disclosure controls and
procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered
by this report based on such evaluation; and
c) Disclosed in this report any change in the Registrant's internal control
over financial reporting that occurred during the Registrant's most recent
fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the Registrant's internal control over financial reporting;
and
5. The Registrant's other certifying officer and I have disclosed, based on
our most recent evaluation of internal control over financial reporting, to the
Registrant's auditors and the audit committee of Registrant's board of directors
(or persons performing the equivalent function):
a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the Registrant's ability to record, process,
summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the Registrant's internal control over
financial reporting.
OCEAN BIO-CHEM, INC.
Date: August 12, 2005 /s/ Peter Dornau
----------------------------------------
Peter G.Dornau
Chairman of the Board of Directors and
Chief Executive Officer
EXHIBIT 31.2
CERTIFICATION
I, Edward Anchel certify that:
1. I have reviewed this quarterly report on Form 10-Q of Ocean Bio-Chem,
Inc. as of and for the periods ended June 30, 2005;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the periods covered by this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the Registrant as
of, and for, the periods presented in this report;
4. The Registrant's other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a - 15(e) and 15d - 15(e)) for the Registrant and have:
a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the Registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this quarterly report is being prepared;
b) Evaluated the effectiveness of the Registrant's disclosure controls and
procedures and presented in this report our conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered
by this report based on such evaluation; and
c) Disclosed in this report any change in the Registrant's internal control
over financial reporting that occurred during the Registrant's most recent
fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the Registrant's internal control over financial reporting;
and
5. The Registrant's other certifying officer and I have disclosed, based on
our most recent evaluation of internal control over financial reporting, to the
Registrant's auditors and the audit committee of Registrant's board of directors
(or persons performing the equivalent function):
a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the Registrant's ability to record, process,
summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the Registrant's internal control over
financial reporting.
OCEAN BIO-CHEM, INC.
Date: August 12, 2005 /s/ Edward Anchel
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Edward Anchel
Chief Financial Officer
Exhibit 32.1
CERTIFICATION
Pursuant to 18U.S.C.Section 1350, the undersigned officers of Ocean
Bio-Chem, Inc. (the "Company"), hereby certify that the Company's Quarterly
Report on Form 10-Q for the quarter ended June 30, 2005 (the "Report") fully
complies with the requirements of Section 13(a) or 15(d), as applicable, of the
Securities Exchange Act of 1934 and that the information contained in the Report
fairly presents, in all material respects, the financial condition and results
of operation of the Company.
Dated: August 12, 2005
/s/ Peter Dornau
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Peter G. Dornau
Chairman of the Board of Directors and
Chief Executive Officer
/s/ Edward Anchel
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Edward Anchel
Chief Financial Officer