UNITED STATES
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 SEPTEMBER 30, 2001
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
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COMMISSION FILE NUMBER: 000-26354
TRIMAINE HOLDINGS, INC.
(Exact name of Registrant as specified in its charter)
WASHINGTON 91-1636980
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
17 DAME STREET
DUBLIN 2, IRELAND
(Address of principal executive offices)
(35 31) 679-1688
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 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
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Indicate the number of shares outstanding of each of the Registrant's classes of
common stock, as of the latest practicable date:
Class Outstanding at November 8, 2001
----- -----------------------------------
Common Stock, $0.01 15,359,397
par value
FORWARD-LOOKING STATEMENTS
Statements in this report, to the extent that they are not based on historical
events, constitute forward-looking statements. Forward-looking statements
include, without limitation, statements regarding the outlook for future
operations, forecasts of future costs and expenditures, the evaluation of market
conditions, the outcome of legal proceedings, the adequacy of reserves, or other
business plans. Investors are cautioned that forward-looking statements are
subject to an inherent risk that actual results may vary materially from those
described herein. Factors that may result in such variance, in addition to
those accompanying the forward-looking statements, include changes in interest
rates, prices and other economic conditions; actions by competitors; natural
phenomena; actions by government and regulatory authorities; uncertainties
associated with legal proceedings; technological development; future decisions
by management in response to changing conditions; and misjudgments in the course
of preparing forward-looking statements.
PART I. FINANCIAL INFORMATION
----------------------
ITEM 1. FINANCIAL STATEMENTS
TRIMAINE HOLDINGS, INC.
CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001
(UNAUDITED)
TRIMAINE HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(DOLLARS IN THOUSANDS)
SEPTEMBER 30, 2001 DECEMBER 31, 2000
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ASSETS
Current Assets
Cash and cash equivalents $ 4,387 $ 2,721
Accounts receivable 58 3,481
Receivable from affiliates 42 445
Note receivable 1,111 -
Real estate held for development and sale 1,044 896
Other assets 6 -
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Total current assets 6,648 7,543
Investments 15,818 10,128
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$ 22,466 $ 17,671
=================== ==================
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Accounts payable $ 69 $ 100
Accrued liabilities 161 123
Deferred tax liabilities 1,688 225
Income tax liabilities 404 -
------------------- ------------------
Total current liabilities 2,322 448
Shareholders' Equity
Preferred stock 1 1
Common stock 154 158
Additional paid-in capital 16,372 16,468
Retained earnings 1 734
Accumulated other comprehensive income (loss) 3,616 (138)
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Total equity 20,144 17,223
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$ 22,466 $ 17,671
=================== ==================
The accompanying notes are an integral part of these financial statements.
TRIMAINE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS (DEFICIT)
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
FOR THE NINE FOR THE NINE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30, 2001 SEPTEMBER 30, 2000
-------------------- --------------------
Revenues
Sale of real estate $ - $ 4,542
Dividend income 270 281
Loss on sale of investment - (1,991)
Other 153 158
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423 2,990
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Costs and expenses
Cost of real estate sold and related selling costs - 1,961
General and administrative expenses 900 384
Real estate taxes 14 15
Interest 9 163
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923 2,523
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Income (loss) before income tax (500) 467
Income tax expenses (benefits) (67) 166
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Net income (loss) (433) 301
Retained earnings (deficit), beginning of period 734 (708)
Dividend paid on preferred shares (300) (300)
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Retained earnings (deficit), end of period $ 1 $ (707)
=================== ===================
Basic earnings (loss) per share $ (0.04) $ 0.00
=================== ===================
The accompanying notes are an integral part of these financial statements.
TRIMAINE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS (DEFICIT)
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
FOR THE THREE FOR THE THREE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30, 2001 SEPTEMBER 30, 2000
-------------------- --------------------
Revenues
Loss on sale of investment $ - $ (1,986)
Other 49 50
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49 (1,936)
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Costs and expenses
General and administrative expenses 300 97
Real estate taxes 4 5
Interest 2 2
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306 104
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Loss before income tax (257) (2,040)
Income tax benefit (229) (686)
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Net loss (28) (1,354)
Retained earnings, beginning of period 29 647
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Retained earnings (deficit), end of period $ 1 $ (707)
=================== ===================
Basic loss per share $ (0.01) $ (0.09)
=================== ===================
The accompanying notes are an integral part of these financial statements.
TRIMAINE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
(DOLLARS IN THOUSANDS)
FOR THE NINE FOR THE NINE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30, 2001 SEPTEMBER 30, 2000
-------------------- -------------------
Net income (loss) $ (433) $ 301
Other comprehensive gain:
Unrealized gain on securities, net of taxes 3,754 1,171
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Total comprehensive income $ 3,321 $ 1,472
=================== ===================
The accompanying notes are an integral part of these financial statements.
TRIMAINE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
(DOLLARS IN THOUSANDS)
FOR THE THREE FOR THE THREE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30,2001 SEPTEMBER 30, 2000
------------------ -------------------
Net loss $ (28) $ (1,354)
Other comprehensive gain:
Unrealized gain on securities 281 1,271
------------------ ------------------
Total comprehensive income (loss) $ 253 $ (83)
================== ==================
The accompanying notes are an integral part of these financial statements.
TRIMAINE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(DOLLARS IN THOUSANDS)
FOR THE NINE FOR THE NINE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30, 2001 SEPTEMBER 30, 2000
-------------------- --------------------
Cash Flows from Operating Activities:
Net income (loss) from operation $ (433) $ 301
Adjustments to reconcile net income (loss) to
net cash provided by operating activities
Loss on sale of investments - 1,991
Amortization - 34
Changes in current assets and liabilities:
Accounts receivable 3,423 -
Real estate held for development and sale (148) 1,608
Prepaid and other assets (6) 66
Receivable from affiliates 403 44
Deferred tax (473) 166
Income tax liabilities 404 -
Accounts payable and accrued liabilities 7 (38)
Other - 50
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Net cash provided by operating activities 3,177 4,222
Cash Flows from Investing Activities:
Increase in note receivable (1,111) -
Purchase of available-for-sale securities - (4,138)
Proceeds from sale of available-for-sale securities - 3,647
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Net cash used in investing activities (1,111) (491)
Cash Flows from Financing Activities:
Repurchase of common shares (100) -
Dividend (300) (300)
Payment of debt - (2,259)
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Net cash used in financing activities (400) (2,559)
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Increase in cash and cash equivalents 1,666 1,172
Cash and cash equivalents, beginning of period 2,721 2,072
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Cash and cash equivalents, end of period $ 4,387 $ 3,244
=================== ===================
The accompanying notes are an integral part of these financial statements.
TRIMAINE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2000
(UNAUDITED)
NOTE 1. BASIS OF PRESENTATION
The interim period consolidated financial statements contained herein have been
prepared by the Registrant pursuant to the rules and regulations of the United
States 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. These interim period statements should
be read together with the audited consolidated financial statements and
accompanying notes included in the Registrant's latest annual report on Form
10-K for the year ended December 31, 2000. In the opinion of the Registrant,
the unaudited consolidated financial statements contained herein contain all
adjustments necessary in order to present a fair statement of the results for
the interim periods presented.
NOTE 2. EARNINGS (LOSS) PER SHARE
Basic earnings (loss) per share is computed by dividing income or loss available
to common shareholders by the weighted average number of shares outstanding
during the period. The weighted average number of shares outstanding was
15,718,615 and 15,837,808 for the nine month periods ended September 30, 2001
and 2000, respectively.
PART I. FINANCIAL INFORMATION
---------------------
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion and analysis of the results of operations and financial
condition of TriMaine Holdings, Inc. (the "Corporation") for the nine and three
month periods ended September 30, 2001 should be read in conjunction with the
consolidated financial statements and related notes included elsewhere herein.
RESULTS OF OPERATIONS - NINE MONTHS ENDED SEPTEMBER 30, 2001
Revenues decreased to $0.4 million for the nine months ended September 30, 2001
from $3.0 million for the comparable period of 2000. In 2000, the Corporation
sold a 29.34 acre parcel of land in Gig Harbor, Washington for gross proceeds of
approximately $4.5 million, which was partially offset by a $2.0 million loss on
sale of investments.
Costs and expenses for the nine months ended September 30, 2001 were $0.9
million compared to $2.5 million in the same period in 2000. The costs and
expenses in 2000 were incurred primarily in connection with the sale of
real property.
Income tax benefits for the nine months ended September 30, 2001 were $67,000 as
a result of the utilization of a deferred tax benefit, compared to income tax
expenses of $0.2 million in the same period in 2000.
Net loss for the nine months ended September 30, 2001 was $0.4 million, or $0.04
per common share, compared to net earnings of $0.3 million, or $0.00 per common
share, for the nine months ended September 30, 2000.
RESULTS OF OPERATIONS - THREE MONTHS ENDED SEPTEMBER 30, 2001
Revenues increased to $49,000 for the three months ended September 30, 2001 from
$(1.9 million) for the comparable period of 2000, primarily as a result of the
loss on sale of investments in 2000.
Costs and expenses increased to $0.3 million in the three months ended September
30, 2001, compared $0.1 million the three months ended September 30, 2000,
primarily as a result of an increase in general and administrative expenses.
Net loss for the three months ended September 30, 2001 was $28,000, or $0.01 per
common share, compared to net loss of $1.4 million, or $0.09 per common share,
for the three months ended September 30, 2000.
LIQUIDITY AND CAPITAL RESOURCES
The Corporation had cash and cash equivalents of $4.4 million at September 30,
2001, compared to $2.7 million at December 31, 2000.
Operating activities provided cash of $3.2 million in the nine months ended
September 30, 2001, compared to $4.2 million in the nine months ended September
30, 2000. Receivables from affiliates provided cash of $0.4 million in the nine
months ended September 30, 2001, compared to $44,000 during the comparable
period in 2000. Accounts receivable provided cash of $3.4 million in the nine
months ended September 30, 2001, compared to $nil in the comparable period in
2000. Real estate held for development and sale used cash of $0.1 million in
the nine months ended September 30, 2001, compared to providing cash of $1.6
million in the comparable period of 2000.
Investing activities in the nine months ended September 30, 2001 used cash of
$1.1 million, compared to $0.5 million in the same period in 2000, primarily as
a result of an increase in a note receivable.
Financing activities used cash of $0.4 million in the nine months ended
September 30, 2001, compared to $2.6 million used in the nine months ended
September 30, 2000, primarily as a result of a decrease in the payment of debts.
The Corporation paid $0.3 million in dividends on its preferred stock in the
nine months ended September 30, 2001 and 2000, respectively.
The Corporation has no commitments for capital expenditures in relation to its
undeveloped real estate, although it may need to provide funds for
pre-development work on certain parcels in order to enhance their marketability
and sale value.
The Corporation believes that its assets should enable the Corporation to meet
its current ongoing liquidity requirements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
MARKET RISK
Reference is made to the Corporation's annual report on Form 10-K for the fiscal
year ended December 31, 2000 and the Corporation's quarterly report on Form 10-Q
for the six months ended June 30, 2001 for information concerning market risk.
The Corporation believes that there were no material changes in market risk
since June 30, 2001.
PART II. OTHER INFORMATION
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ITEM 1. LEGAL PROCEEDINGS
Reference is made to the Corporation's annual report on Form 10-K for the fiscal
year ended December 31, 2000 for information concerning legal proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Corporation held its annual meeting of shareholders on July 11, 2001. At
the meeting, Roy Zanatta was elected as a Class III director of the Corporation
for a term expiring at the annual meeting of shareholders in 2004 and Woon Hyung
Lee was appointed as a Class II director of the Corporation for a term expiring
at the annual meeting of shareholders in 2003. The voting results for the
election of directors were as follows:
ABSTENTIONS AND
VOTES FOR VOTES WITHHELD BROKER NON-VOTES
--------------- -------------- ----------------
Roy Zanatta 10,258,339 5,951 -
Woon Hyung Lee 10,258,339 5,951 -
Mr. Lee resigned as a director of the Corporation effective October 5, 2001 and
Young Soo Ko was appointed as a Class II director in his place on that same
date.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
None.
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.
Dated: November 12, 2001 TRIMAINE HOLDINGS, INC.
By: /s/ Michael J. Smith
-----------------------
Michael J. Smith,
President, Chief
Financial Officer and
Director