U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
(Mark One)
x QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [Fee Required]
_ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934 [No Fee Required]
For the Quarter Ended November 30, 1995
Commission file number 1-10069
ENVIRONMENTAL TESTING TECHNOLOGIES, INC.
(formerly Peripheral Systems, Inc.)
Washington 93-0845837
(State of Incorporation) (IRS Employer ID No.)
7500 Perimeter Road South
Seattle, WA 98108
(Address of principal executive offices) (Zip Code)
206-763-1919
(Telephone Number)
Check whether the registrant filed all documents and reports to be filed by
Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 after the
distribution of securities under a plan confirmed by the bankruptcy court.
YES __X__ NO _____
Common stock, no par value, $1,493,315 shares outstanding as of 12/31/95
Table of Contents Page
PART I - Financial Information Page No.
Item 1 Condensed Consolidated Balance Sheet 1
Condensed Consolidated Statement of Operations 2
Notes to Financial Statement 3
Item 2 Management Discussion & Analysis of 4
Financial Condition & Results of Operations
PART II - Other
Item 1 Legal Proceedings 5
Item 2 Reports on Form 8K 5
Signatures 6
Part I - Financial Information
Environmental Testing Technologies, Inc. & its subsidiaries
Balance Sheet
11/30/95 5/31/95
Unaudited Audited
ASSETS
Current Assets
Cash $158 $12,659
Accounts Receivable - net of allowances 188,397 535,299
Other current assets 52,859 225,570
------- -------
TOTAL current assets 241,414 773,528
Property, Plant & Equipment
Building & leasehold improvements 115,912 126,178
Machinery & equipment 1,958,700 2,205,328
Vehicles & office trailers 242,052 325,943
Furniture & fixtures 60,405 86,112
Less accumulated depreciation <1,708,549> <1,735,668>
------- ---------
Property, Plant & Equip. (Net) 668,520 1,007,893
Other Assets
Deposits 21,241 30,058
TOTAL ASSETS $931,175 $1,811,479
LIABILITIES & STOCKHOLDER'S DEFICIT
Current Liabilities
Line of Credit $143,196 $522,452
Accounts Payable 430,041 370,284
Accrued Liabilities 137,287 164,473
Current portion of long term debt 568,644 529,041
-------- --------
TOTAL current liabilities 1,279,168 1,786,250
Long Term Debt 181,876 222,389
Income Tax Payable 175,000 175,000
Redeemable Preferred Stock 176,958 176,958
Stockholder's (Deficit) Equity
Preferred Stock 100,000 200,000
Common Stock (no par value) 626,557 608,557
Accumulated deficit <1,608,384> <1,357,675>
----------- -----------
TOTAL Stockholder's Deficit <881,827> <549,118>
TOTAL LIABILITIES & STOCKHOLDER'S DEFICIT $931,175 $1,811,479
Environmental Testing Technologies, Inc. & its subsidiaries
Statement of Operations
6 Months 6 Months
Ended Ended
11/30/95 11/30/94
Sales $996,181 $1,735,407
Cost of Sales 757,026 1,148,928
-------- ----------
Gross Profit 239,155 586,479
Operating Expenses:
Selling, General & Administrative 414,751 406,562
Operating Income <Loss> <175,596> 179,917
Other Income <Expense>:
Interest <83,333> <68,993>
Net Loss on Discontinued Operations <34,920> <12,684>
Gain on Sale of Discontinued Business 43,139 - -
Total Income <Loss> Before Income Taxes <250,710> 98,240
Federal Income Tax 0 0
Net Income <Loss> <$250,710> <98,240>
Net Income <Loss> Per Share <.02> 01
Weighted Average Shares Outstanding 1,481,612 1,386,315
Notes to Condensed Consolidated Financial Statements
Item 1 - The unaudited consolidated financial statements and related notes have
been prepared pursuant to the rules and regulations of the Securities and
Exchange Commission. Accordingly, certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been omitted pursuant to such rules and
regulations. The accompanying consolidated financial statements and related
notes should be read in conjunction with the audited financial statements of the
Company, and notes thereto, for the fiscal year ended May 31, 1995.
The information furnished reflects, in the opinion of management, all
adjustments, consisting of normal recurring accruals, necessary for a fair
presentation of the results of the interim periods presented.
Item 2 - Management's Discussion and Analysis of Financial Condition & Results
of Operations
Sales for the six months ended November 30, 1995 and November 30, 1994, were
$996,181 and $1,735,407 respectively. The sales reductions of $739,226 were the
result of an abnormal decline in business volume at X-Ray,Inc., coupled with the
near disappearance of TankTek business caused by former managements leaving
the Company and taking the business with it. In 1994 TankTek enjoyed a large
Alaskan contract that did not reoccur in 1995.
Cost of Sales for the 6 months ended November 30, 1995 and November 30,1994
were $757,226 and $1,148,928 respectively. These cost of sales resulted in
gross profits of $239,155 in 1995 and $586,479 in 1994. The loss of gross
profit is directly attributable to the lower sales volumes between this time
period.
Selling, general and administrative expenses remained relatively constant
between this time period.
Interest expense increased in 1995 over 1994 due to increased borrowings to
cover the operating losses, as well as financing new equipment for TankTek's
expected sales increases.
Losses for discontinued operations of $34,920 in 1995 and $12,684 in 1994 and
gains on sales of disposed assets of $43,139 in 1995 are directly attributable
to the sale of Accu-Inspect, Inc. in June 1995. Future gains on the sale will
be recorded as realized with the collection of the outstanding notes totaling
$202,000.
Net income <loss> for the 6 months ended November 30, 1995 were <$250,710> and
$98,240 in 1994. The loss incurred was caused by the Company's inability to
achieve the sales levels anticipated.
PART II - Other Information
1. Legal Proceedings.
The Company is not a party to any material pending legal proceedings other than
ordinary routine litigation incidental to the business, except for a suit filed
by Mr. Anton Kurtz, the owner of the Class A Preferred Stock. ETT is one of
the defendents in this suit and intends to vigorously defend against this suit
on a number of grounds and does not expect Mr. Kurtz to prevail in his
assertions.
Item 6 Exhibits and Reports on Form 8K
No reports on Form 8K were filed for the 6 month period ending November 30,1995.
Signatures
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf, by the undesigned, thereunto duly
authorized:
ENVIRONMENTAL TESTING TECHNOLOGIES, INC.
__________________________________________________________________
Date George B. Maitland, VP Finance
__________________________________________________________________
Date Lee G. Connel, Director