UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 1 to
FORM 10-QSB/A
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended: June 30, 2001
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from ___________________ to ________________.
Commission file number: 0-29027
Whitehall Limited, Inc.
(Exact name of small business issuer as specified in its charter)
Florida 84-1092599
- --------------------------------- -------------------
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
290 Cocoanut Avenue, Sarasota, Florida 34236
- --------------------------------------------------------------------------------
Address of principal executive offices
941-954-1181
- --------------------------------------------------------------------------------
(Issuer's telephone number)
Not applicable
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
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 [ ]
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: 9,167,920
Transitional Small Business Disclosure Format (check one):
Yes [ ] No [X]
Part I
Financial Information
Item 1. Financial Statements
See financial statements beginning on page F-1
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Form 10-QSB, other than historical financial information, may consist of
forward-looking statements that include risks and uncertainties, including, but
not limited to, statements contained in "Management's Discussion and Analysis of
Financial Condition and Results of Operations." Such statements are based upon
many assumptions and are subject to risks and uncertainties. Actual results
could differ materially from the results discussed in the forward-looking
statements due to a number of factors, including, but not limited to, those
identified in this document and the company's other filings with the Securities
and Exchange Commission. The Company disclaims any intent or obligation to
update these forward-looking statements.
OVERVIEW:
The Company builds quality homes with custom features at moderate prices. The
homes are designed principally for the entry level or "moving up" home buyers'
market, as well as the retirement segment of such market. Residences constructed
and marketed by the Company generally range in size from 1,400 to 3,500 square
feet and have purchase prices ranging from $150,000 to $500,000. In the past,
certain of the Company's projects consisted of smaller units and were geared
more to the lower-end buyer. The company markets the residences through
commissioned employees and independent real estate brokers in the Company's
market area, which consists of the West Coast of the State of Florida,
primarily, Sarasota, Manatee, Collier, Pasco and Hillsborough Counties.
Residential unit sales are usually conducted from sales offices located in
furnished models in each subdivision where the Company is active. The Company
also typically constructs a limited number of speculative homes in each
residential subdivision in which it is active in order to enhance marketing and
sales activities.
RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED JUNE 30, 2001 AS COMPARED TO
THE THREE MONTHS ENDED JUNE 30, 2000:
2
The Company is presently engaged in the development of the following projects:
TOTAL ESTIMATED NUMBER OF UNITS UNITS CLOSED
NUMBER OF AVERAGE SELLING TO CLOSE AS OF THREE MONTHS THREE MONTHS
PROJECT UNITS PRICE PER UNIT 6/30/01 6/30/01 6/30/00
------- --------- --------------- --------------- ------------ ------------
Avalon at The Villages
of Palm Aire 114 $186,000 30 10 10
Bermuda Club 30 $200,000 3 1 1
Heron Creek Golf
& Country Club 112 $250,000 45 4
Lake Jovita 60 $240,000 59
Off Site 0 0 1
--- -- --
137 15 12
=== == ==
3
RESULTS OF OPERATIONS:
The following table sends forth operating data as a percentage of revenue:
THREE MONTHS ENDED
JUNE 30
------------------
2001 2000
----- -----
Revenues:
Home and lot sales 99% 98%
Other 1% 2%
--- ---
Total 100% 100%
--- ---
Costs and expenses:
Cost of sales 67% 71%
Selling 11% 10%
General and administrative 11% 11%
Interest 1% 2%
--- ---
Total 90% 94%
--- ---
Income before income taxes 10% 6%
=== ===
4
REVENUES:
HOME AND LOT SALES:
The Company's Home and Lot sales increased by approximately $972,000 to
approximately $4,049,000 for the three months ended June 30, 2001 as compared to
approximately $3,077,000 for the three months ended June 30, 2000. The Company
was able to take advantage of the continued strong real estate markets, thereby
increasing the average base sales price per unit, the number of units closed, as
well as sell an increased number of options per unit. In addition, the Company
continued certain phases of projects under development that contained the
premium or choice units thereby demanding a higher unit value. As a result of
the aforementioned, the average unit sales price on the 15 units closed during
the three months ended June 30, 2001 was approximately $270,000 as compared to
approximately $256,000 for the 12 units closed during the three months ended
June 30, 2000.
OTHER REVENUE:
Other revenue consists of Management fee, interest, real estate, commissions and
sundry income. During the three months ended June 30, 2001 and 2000, other
revenue was approximately $22,000 and $62,000, respectively. The primary reason
for the decrease is that the Company earned approximately $29,000 and $6,000 of
management fees and real estate commissions, respectively, during the three
months ended June 30, 2000 on projects that were completed during the year ended
March 31, 2001.
COSTS AND EXPENSES:
COST OF SALES:
Cost of sales increased by approximately $514,000 to approximately $2,732,000
for the three months ended June 30, 2001 as compared to approximately $2,218,000
for the three months ended June 30, 2000. The primary reason for the increase
was due to the sales value of the closed units during the comparable period.
However, the cost as a percent of sales approximated 67% for the three months
ended June 30, 2001 as compared to 71% for the three months ended June 30, 2000.
The primary reason for the decrease is due to the fact that during the strong
real estate market the Company was able to keep its cost in-line while
increasing the sale price of each unit.
5
SELLING, GENERAL AND ADMINISTRATIVE:
Selling, general and administrative increased for the three months ended June
30, 2001 as compared to the three months ended June 30, 2000 by approximately
$267,000 to approximately $904,000 from approximately $637,000. However, the
selling, general and administrative costs as a percent of sales was consistent
between the periods therefore the increase was primarily related to the increase
in commissions and other selling expenses resulting from the higher level of
home and lot sales and a slight increase in the Company's infrastructure.
INTEREST:
Interest decreased for the three months ended June 30, 2001 as compared to the
three months ended June 30, 2000 by approximately $41,000. The primary reason
for this is due to the company paying down its non-construction related debt.
INCOME BEFORE INCOME TAXES:
As a result of the aforementioned, income before income taxes increased by
approximately $192,000 to approximately $394,000 ($.02 per share) for the three
months ended June 30, 2001 from approximately $202,000 ($.01 per share) for the
three months ended June 30, 2000. The basic earning per share was based on a
weighted average number of shares outstanding of 11,194,192 and 8,946,000 for
the three months ended June 30, 2001 and 2000, respectively.
LIQUIDITY AND CAPITAL RESOURCES:
As of June 30, 2001, the Company had net assets of approximately $2,602,000
including cash and cash equivalents of approximately $949,000. During the three
months ended June 30, 2001, the Company's cash position decreased by
approximately $1,000. Its operating activities utilized approximately $1,610,000
of cash. This was caused primarily by an increase in inventories of
approximately $2,016,000. This increase was funded mainly by the Company's net
income of approximately $247,000, a net increase in customer deposits of
approximately $78,000 and the Company's financing activities. The Company's
financing activities provided approximately $1,609,000 of cash principally from
the proceeds of its mortgages and notes payable of approximately $4,029,000 net
of repayments of approximately $2,420,000. The Company's principal source of
financing has historically been provided from its construction financing which
is based on the value of the underlying projects.
6
Part II
Other Information
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities
Not applicable.
Item 3. Defaults Upon Senior Securities
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
None.
(b) Reports on Form 8-K
We did not file any reports on Form 8-K during the quarter for
which this report is filed.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Whitehall Limited, Inc.
December 11, 2001 /s/ Ronald Mustari
----------------------------------
Ronald Mustari, President and
Chief Executive Officer
(Principal Executive Officer)
December 11, 2001 /s/ Joanne Mustari
----------------------------------
Joanne Mustari, Treasurer and
Chief Financial Officer
(Principal Financial and
Accounting Officer)
7
WHITEHALL LIMITED, INC. AND SUBSIDIARIES
INDEX
PAGE
----
CONDENSED CONSOLIDATED BALANCE SHEET JUNE 30, 2001 (UNAUDITED) F-2
CONDENSED CONSOLIDATED STATEMENTS OF INCOME THREE MONTHS ENDED
JUNE 30, 2001 AND 2000 (UNAUDITED) F-3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS THREE MONTHS ENDED
JUNE 30, 2001 AND 2000 (UNAUDITED) F-4
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) F-5
* * *
F-1
WHITEHALL LIMITED, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
JUNE 30, 2001
(UNAUDITED)
ASSETS
Cash and cash equivalents $ 948,627
Inventories 9,312,826
Property and equipment, net 1,758,336
Other assets 48,825
-----------
Total $12,068,614
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgages and notes payable $ 6,145,299
Accounts payable and accrued expenses 1,123,663
Customer deposits and advances 1,547,408
Income taxes payable 604,100
Deferred tax liabilities 45,936
-----------
Total liabilities 9,466,406
-----------
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.10 par value; 100,000,000 shares
authorized; 2,061,946 shares issued and outstanding 206,195
Common stock, $.10 par value; 500,000,000 shares
authorized; 9,167,920 shares issued and outstanding 916,792
Additional paid-in capital 1,184,938
Retained earnings 294,283
-----------
Total stockholders' equity 2,602,208
-----------
Total $12,068,614
===========
See Notes to Condensed Consolidated Financial Statements.
F-2
WHITEHALL LIMITED, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
THREE MONTHS ENDED JUNE 30, 2001 AND 2000
(UNAUDITED)
2001 2000
----------- ----------
Revenue:
Home and lot sales $ 4,048,826 $3,076,509
Other 22,293 62,203
----------- ----------
Totals 4,071,119 3,138,712
----------- ----------
Costs and expenses:
Cost of sales 2,732,137 2,218,444
Selling 470,094 282,368
General and administrative 434,334 354,894
Interest 40,145 81,189
----------- ----------
Totals 3,676,710 2,936,895
----------- ----------
Income before income taxes 394,409 201,817
Provision for income taxes 147,100 79,533
----------- ----------
Net income $ 247,309 $ 122,284
=========== ==========
Basic earnings per share $ .02 $ .01
=========== ==========
Basic weighted average shares outstanding 11,194,192 8,946,000
=========== ==========
See Notes to Condensed Consolidated Financial Statements.
F-3
WHITEHALL LIMITED, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED JUNE 30, 2001 AND 2000
(UNAUDITED)
2001 2000
----------- -----------
Operating activities:
Net income $ 247,309 $ 122,284
Adjustments to reconcile net income to net cash
used in operating activities:
Depreciation 8,720 9,616
Equipment loss 274
Deferred income taxes (27,000)
Forgiveness of stockholders' interest 23,023
Cost of services paid through issuance
of common stock 38,956
Changes in operating assets and liabilities:
Inventories (2,016,164) (1,053,067)
Due from affiliates (16,616)
Other assets 9,159 28,500
Accounts payable and accrued expenses (123,166) (273,998)
Customer deposits and advances 77,897 695,867
Income taxes payable 174,100 79,533
----------- -----------
Net cash used in operating activities (1,610,189) (384,584)
----------- -----------
Investing activities:
Investments (97,464)
Stockholders' loans (150,291)
-----------
Net cash used in investing activities (247,755)
-----------
Financing activities:
Proceeds from mortgages and notes payable 4,029,148 598,921
Repayments of mortgages and note payable (2,420,337) (124,977)
----------- -----------
Net cash provided by financing activities 1,608,811 473,944
----------- -----------
Net decrease in cash and cash equivalents (1,378) (158,395)
Cash and cash equivalents, beginning of period 950,005 675,299
----------- -----------
Cash and cash equivalents, end of period $ 948,627 $ 516,904
=========== ===========
Supplemental disclosure of cash flow data:
Interest paid, net of amount capitalized $ 40,145 $ 58,165
=========== ===========
See Notes to Condensed Consolidated Financial Statements.
F-4
WHITEHALL LIMITED, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1 - Basis of presentation:
In the opinion of management, the accompanying unaudited condensed
consolidated financial statements reflect all adjustments, consisting of
normal recurring accruals, necessary to present fairly the financial
position of Whitehall Limited, Inc. and Subsidiaries (the "Company") as of
June 30, 2001, and its results of operations and cash flows for the three
months ended June 30, 2001 and 2000. Pursuant to the rules and regulations
of the United States Securities and Exchange Commission (the "SEC"),
certain information and disclosures normally included in financial
statements prepared in accordance with accounting principles generally
accepted in the United States of America have been condensed in or omitted
from these financial statements unless significant changes have taken place
since the end of the most recent fiscal year. Accordingly, these unaudited
condensed financial statements should be read in conjunction with the
audited financial statements as of and for the year ended March 31, 2001
and the notes thereto (the "Audited Financial Statements") and the other
information included in the Company's Annual Report on Form 10-KSB (the
"Form 10-KSB") for the year ended from March 31, 2001 that was previously
filed with the SEC.
The results of the Company's operations for the three months ended June 30,
2001 are not necessarily indicative of the results of operations for the
full year ending March 31, 2002.
Significant accounting policies and line of business have not changed from
March 31, 2001.
Note 2 - Earnings per common share:
The Company presents basic earnings per share and, if appropriate, diluted
earnings per share in accordance with the provisions of Statement of
Financial Accounting Standards No. 128, "Earnings per Share" ("SFAS 128").
Diluted per share amounts have not been presented in the accompanying
unaudited condensed consolidated statements of operations for the three
months ended June 30, 2001 and 2000 because (1) in 2001 there were no
dilutive securities outstanding and (2) in 2000 there were no additional
shares derived from the assumed conversion of the note payable -
stockholder at fair value and the application of the treasury stock method.
* * *
F-5