SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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, 2000
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 33-83418-LA
CYBERIA HOLDINGS, INC.
(Exact name of Small Business Issuer as Specified in its Charter)
Delaware 93-1138967
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Identification
Organization) Number)
1531 14th Street
Santa Monica, California 90404
(Address of Principal Executive Offices)
(310) 260-3163
(Issuer'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
State the number of shares outstanding of each of the Issuer's classes of
common equity, as of the latest practicable date:
Common, $.0001 par value per share: 30,000,000
outstanding as of August 1, 2000
PART I - FINANCIAL INFORMATION
CYBERIA HOLDINGS, INC. AND SUBSIDIARY
Index to Financial Information
Period Ended June 30, 2000
Item Page Herein
Item 1 - Financial Statements:
Consolidated Balance Sheet 3
Consolidated Statements of Operations 4
Consolidated Statements of Cash Flows 6
Notes to Condensed Consolidated
Financial Statements 7
Item 2 - Management's Discussion and
Analysis or Plan of Operation 8
CYBERIA HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEET
June 30, 2000
ASSETS
Current Assets
Cash $ 64,529
Accounts receivable 326,892
Advances to Employees/Other 6,639
Work in Process 1,949
Due from Members 28,326
Due from Affiliates 26,968
Deferred tax asset 18,320
Total current assets 473,623
Non-current assets
Property, plant and
equipment(net) 270,359
Other assets 47,395
Total non-current assets 317,754
Total assets $791,376
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable and
accrued expenses $57,324
Deferred income 94,369
Due to affiliate 60,844
Due to others 1,500
Accrued payroll and
payroll taxes 82,891
Income tax payable 28,197
Capital Lease Payable
- Current 38,744
Total current liabilities 363,870
Long term liabilities
Capital Lease - Long Term 126,422
Deferred income taxes
- long term 7,144
Total long term liabilities 133,566
Minority Interest 108,618
Stockholders' equity
Common stock 3,000
Additional paid in capital 9,269
Retained earnings 173,053
Total stockholders'
equity 185,322
Total liabilities
& stockholders' equity $ 791,376
CYBERIA HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE PERIODS
4/1/00 4/1/99
THROUGH THROUGH
6/30/00 6/30/99
Sales $ 404,921 $ 866,724
Cost of sales 72,634 66,239
General and
administrative expenses 731,312 454,036
Total expenses 803,946 520,275
Net income (loss)
from operations (399,025) 346,449
Other income (expense)
Interest income 2,377 407
Other Income - -
Gain/Loss on
Sale of Securities - -
Equity in Earnings
of Med Rev - -
Interest expense (6,284) (716)
Total other
income (expense) (3,906) (309)
Income (loss) from
before taxes (402,931) 346,140
Income taxes (123,995) 26,354
Net income (loss) before
minority interest $(278,936) $319,786
Minority Interest 7,865 77,876
Net income(loss) $(286,802) $241,910
Basic and diluted
Earnings per share $ (.01) $ .01
Basic and diluted
Weighted average shares
Outstanding 30,000,000 30,000,000
CYBERIA HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE PERIODS
1/1/00 1/1/99
THROUGH THROUGH
6/30/00 6/30/99
Sales $ 1,506,364 $1,542,664
Cost of sales 157,771 138,512
General and
administrative expenses 1,349,082 809,853
Total expenses 1,506,854 948,005
Net income (loss)
from operations (490) 594,659
Other income (expense)
Interest income 3,941 617
Other Income - -
Gain/Loss on
Sale of Securities - -
Equity in Earnings
of Med Rev - -
Interest expense (12,224) (5,507)
Total other
income (expense) (8,283) (4,890)
Income (loss)
before taxes (8,773) 589,769
Income taxes 6,986 81,424
Net income (loss) before
minority interest (15,759) 487,953
Minority Interest 7,865 81,424
Net income (loss) $ (23,624) $ 406,529
Basic and diluted
Earnings per share $ 0 $ .01
Basic and diluted
Weighted average shares
Outstanding 30,000,000 30,000,000
CYBERIA HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE PERIODS
1/1/00 1/1/99
THROUGH THROUGH
6/30/00 6/30/99
Operating Activities:
Net income (loss) $ (23,624) $ 406,529
Adjustments to reconcile
net income to net cash
provided by
operating activities
Depreciation and
amortization 56,252 7,926
Minority Interest 1,033 81,424
(Increase) decrease in:
Accounts receivable 22,949 (418,260)
Prepaid and
other current assets 9,346 (24,001)
Work in process (6,639) 0
Other assets (4,447) (8,238)
Increase (decrease) in:
Accounts payable and
accrued expenses 10,490 (611)
Book Overdraft (24,863) 0
Due to affiliates (108,208) 17,674
Accrued P/R & P/R taxes 57,852 2,479
Income Tax Payable 96 100,916
Deferred income 92,869 (1,500)
Net cash provided by
operating activities
- - continuing 84,606 164,338
Net cash used in
operating activities
- - discontinued (811) (88,000)
Investing Activities:
Advances to Employees (1,949) -
Due from Officer (2,225) -
Long Term
Lease Obligations 74,525 -
Current Lease
Obligations (18,388) -
Purchase of
computer equipment (98,666) (29,828)
Net cash used in
investing activities (46,703) (29,828)
Net increase (decrease)
in cash 37,092 (29,828)
Cash, beginning of period 27,437 104,998
Cash, end of period $ 64,529 $ 151,508
CYBERIA HOLDINGS, INC. AND SUBSIDIARY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2000
(UNAUDITED)
1. Presentation of Interim Information
The accompanying unaudited consolidated financial statements have been
prepared in conformity with generally accepted accounting principles for
interim financial information and with Regulation S-B. Accordingly, they do
not include all the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all normal, recurring adjustments considered necessary for a
fair presentation have been included. These consolidated financial
statements should be read in conjunction with the consolidated financial
statements and notes thereto included in the Company's Annual Report on Form
10-KSB for the year ended December 31, 1999. The results of operations for
the three months ended June 30, 2000 are not necessarily indicative of the
results that may be expected for the year ended December 31, 2000.
2. Financial Statements
The consolidated financial statements include the accounts of the
Company and its subsidiary, Media Revolution. All significant intercompany
balances, transactions and stockholdings have been eliminated.
3. Furniture and Equipment
Furniture and equipment at June 30, 2000 (unaudited) consisted of the
following:
Furniture and Fixtures $ 16,702
Computer Equipment 148,021
Office Equipment 20,584
Leasehold Improvements 13,272
Capital Leases 269,760
468,339
Less accumulated depreciation
and amortization 197,980
Total $270,359
Item 2. Management's Discussion and Analysis or Plan of Operation.
The following discussion should be read in conjunction with the
Financial Information and Notes thereto included in this report and is
qualified in its entirety by the foregoing.
Background
The Company was organized under the laws of the State of Delaware on
February 24, 1994 under the name NW Venture Corp. In October 1995, the
Company completed an initial public offering of certain shares of its Common
Stock pursuant to a Registration Statement declared effective by the
Securities and Exchange Commission on June 30, 1995 as a "blank check"
offering subject to Rule 419 of Regulation C under the Securities Act of
1933.
In May 1996, the Company executed an agreement with Cyberia, Inc., a
California corporation ("Cyberia"), and its shareholders to acquire all of
the issued and outstanding shares of capital stock of Cyberia in exchange
for 25,500,000 shares of Common Stock of the Company (the "Cyberia
Acquisition"). At the time thereof and through December 31, 1998, Cyberia
was primarily involved in the business of creating original music for
television and radio commercials. As of December 26, 1996, and following
successful completion of a reconfirmation offering required pursuant to Rule
419, the Company consummated the Cyberia Acquisition whereby Cyberia became
a wholly-owned subsidiary of the Company.
During 1996, Cyberia entered into an agreement to form Media
Revolution, LLC ("Media Revolution"), which was organized to design
Internet web sites, computer games and software. The Company owns 80% of
this entity and has control of the day-to-day operations. A non-related
party owns the remaining 20%.
On January 13, 1997, the Company changed its corporate name to Cyberia
Holdings, Inc. to reflect the change of direction and new business of the
Company which resulted from the aforesaid transaction with Cyberia.
On October 6, 1998 a meeting of the Board of Directors and Officers was
held in which it was decided to cease the operations of Cyberia, Inc. as of
December 31, 1998 to allow the Company to focus its resources on the growth
and development of Media Revolution. All existing assets and liabilities at
the close of operations on December 31, 1998 have been transferred to
Cyberia Holdings, Inc. as per the Certificate of Dissolution filed in the
Office of the Secretary of State of California.
Results of Operations for the three months ended June 30, 2000
Net sales for the three month period ended June 30, 2000 were $404,921 as
compared to $866,724 for the three month period ended June 30, 1999 a
decrease of $461,803 or 53%. This decrease is primarily due to the
Company's change in its focus from the entertainment sector to new target
sectors. These target sectors included start up companies and the "dot.com"
sector. These sectors have both proven to be financially unstable, with two
of the Company's clients during the quarter losing funding and being unable
to complete their contracts. Additionally, the Company's focus on securing
projects with a larger scope has slowed the sales process as projects with a
larger scope have a longer pitch and closing time.
Cost of sales was $72,634 for the three month period ended June 30, 2000 as
compared to $66,239 for the three month period ended June 30, 1999, an
increase of $6,395 or 10%. This increase is primarily due to an increase in
staff and salaries required in order to retain employees.
General and administrative expenses were $731,312 for the three month period
ended June 30, 2000 compared to $454,036 for the three month period ended
June 30,1999, an increase of $277,276 or 61%. The increase is primarily due
to an increase in rent following the move of the subsidiary into a new
location, the continued search for and hiring of new employees by the
subsidiary and related employment placement fees incurred in connection with
these new hires, and accounting, management and legal fees incurred as part
of the restructuring of Media Revolution. Additionally, the Company
incurred approximately $60,000 in marketing expenditures to begin a campaign
which will extend into the third quarter.
Results of Operations for the Six Months Ended June 30, 2000
Net sales for the six month period ended June 30, 2000 were
$1,506,364 as compared to $1,542,664 for the six month period ended June 30,
1999, a decrease of $36,300 or 2%. This decrease is primarily due to the
Company's change in its focus from the entertainment sector to its
previously defined target sectors. These target sectors included start up
companies and the "dot.com" sector. These sectors have both proven to be
financially unstable, with two of the Company's clients during the period
closing funding and being unable to complete their contracts. Additionally,
the Company's focus on securing projects with a larger scope has slowed the
sales process as projects with a larger scope have a longer pitch and
closing time.
Cost of sales was $157,771 for the six month period ended June 30,
2000 as compared to $138,152 for the six month period ended June 30, 1999,
an increase of $19,619 or 14%. This increase is primarily due to an
increase in salaries and benefits needed in order to avoid employee turnover
as the industry salaries and benefits are continually becoming more
competitive.
General and administrative expenses were $1,349,082 for the six month
period ended June 30, 2000 compared to $809,853 for the six month period
ended June 30, 1999, an increase of $539,229 or 67%. The increase is
primarily due to an increase in rent following the move of Media Revolution
into a new location, the continued search for and hiring of new employees
by Media Revolution, and increased employee benefits needed in order to
remain competitive with other employers in the industry.
Liquidity and Capital Resources
At June 30, 2000, the Company had a working capital surplus of
$109,753. The ratio of current assets to current liabilities was
approximately 1.30 to 1 at June 30, 2000. At June 30, 2000, the Company had
stockholders' equity of $185,322.
To date, the Company has funded its activities principally from cash
flows generated from operations. It is anticipated that the Company's
continuing cash flows from operations will be sufficient to meet its cash
and working capital requirements for the next thirteen months. However, if
the Company's cash flows should be materially less than expected, the
Company may find it necessary to seek additional sources of financing to
support its cash and working capital requirements. Although the Company is
hopeful that such financing can be arranged, there can be no assurance the
Company will in fact be able to obtain such financing at the time, if any,
such need arises, or if obtained, on terms acceptable to the Company.
Year 2000 Issue
The year 2000 issue is the result of computer programs being written
using two digits, rather than four, to define the applicable year. Software
programs and hardware that have date-sensitive software or embedded chips
may recognize a date using "00" as the year 1900 rather than the year 2000.
This could result in a major system failure or miscalculations causing
disruptions of operations, including a temporary inability to engage in
normal business activities.
Although no assurance can be given that there will be no
interruption of operations due to year 2000 issues, the Company has not to
date suffered any significant problems and believes that it has reasonably
assessed all of its systems in order to ensure that the
Company will not suffer any material adverse effect in the future.
The Company has used and will continue to use, if necessary, internal
resources to resolve year 2000 issues. Costs incurred to date by the Company
have not been material. The Company does not anticipate incurring any
further
costs.
Forward-Looking Statements
This report contains certain forward-looking statements and information
relating to the Company that are based on the beliefs and assumptions made
by the Company's management as well as information currently available to
the management. When used in this document, the words "anticipate",
"believe", "estimate", and "expect" and similar expressions, are intended to
identify forward-looking statements. Such statements reflect the current
views of the Company with respect to future events and are subject to
certain risks, uncertainties and assumptions. Should one or more of these
risks or uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those described herein as
anticipated, believed, estimated or expected. The Company does not intend
to update these forward-looking statements.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Changes in Securities.
None.
Item 3. Defaults Upon Senior Securities.
None.
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.
There are no exhibits applicable to this Form 10-QSB.
(b) Reports on Form 8-K.
Listed below are reports on Form 8-K filed during the
fiscal quarter ended June 30, 2000.
None.
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.
CYBERIA HOLDINGS, INC.
(Registrant)
Dated: September 7, 2000 By: /s/ Jay Rifkin
Jay Rifkin, President
Dated: September 7, 2000 By: /s/ Jay Rifkin
Jay Rifkin, Principal
Financial Officer