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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, 2003
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ________ TO ________
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.)
FLOOR 21, MILLENNIUM TOWER, HANDELSKAI 94-96, A-1200, VIENNA, AUSTRIA
(Address of office)
(43) 1 240 25 102
(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 by check mark whether the Registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act). Yes No X
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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 14, 2003
----- -----------------------------------
Common Stock, $0.01 15,221,397
par value
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PART I. FINANCIAL INFORMATION
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ITEM 1. FINANCIAL STATEMENTS
TRIMAINE HOLDINGS, INC.
CONSOLIDATED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2003
(UNAUDITED)
2
TRIMAINE HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(DOLLARS IN THOUSANDS)
SEPTEMBER 30, 2003 DECEMBER 31, 2002
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ASSETS
Current Assets
Cash and cash equivalents $ 3,479 $ 3,494
Note receivable - 728
Real estate held for development and sale 1,267 1,242
Other 452 442
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Total current assets 5,198 5,906
Investments 25,974 13,741
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$ 31,172 $ 19,647
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable $ 5 $ 45
Accrued liabilities 240 178
Advance from affiliates 269 506
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Total current liabilities 514 729
Deferred Income Tax Liability 4,949 866
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5,463 1,595
Shareholders' Equity
Preferred stock 1 1
Common stock 152 152
Additional paid-in capital 16,322 16,331
Deficit (1,116) (707)
Accumulated other comprehensive income 10,350 2,275
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Total equity 25,709 18,052
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$ 31,172 $ 19,647
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The accompanying notes are an integral part of these financial statements.
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TRIMAINE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
FOR THE NINE FOR THE NINE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30, 2003 SEPTEMBER 30, 2002
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Revenues
Investment and other income $ 14 $ 356
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14 356
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Costs and Expenses
General and administrative expenses 192 194
Interest 7 9
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199 203
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Income (loss) before income tax (185) 153
Income tax expenses (benefit) (76) 52
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Net income (loss) (109) 101
Deficit, beginning of period (707) (683)
Dividends paid on preferred shares (300) (300)
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Deficit, end of period $ (1,116) $ (882)
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Basic loss per share $ (0.02) $ (0.01)
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The accompanying notes are an integral part of these financial statements.
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TRIMAINE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT
(UNAUDITED)
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
FOR THE THREE FOR THE THREE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30, 2003 SEPTEMBER 30, 2002
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Revenues
Investment and other income $ 8 $ 75
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8 75
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Costs and Expenses
General and administrative expenses 18 91
Interest 3 5
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21 96
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Loss before income tax (13) (21)
Income tax benefit (4) (7)
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Net loss (9) (14)
Deficit, beginning of period (1,107) (868)
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Deficit, end of period $ (1,116) $ (882)
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Basic loss per share $ (0.01) $ (0.01)
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The accompanying notes are an integral part of these financial statements.
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TRIMAINE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
(DOLLARS IN THOUSANDS)
FOR THE NINE FOR THE NINE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30, 2003 SEPTEMBER 30, 2002
------------------ ------------------
Net income (loss) $ (109) $ 101
Other comprehensive gain (loss):
Unrealized gain (loss) on securities, net of taxes 8,075 (5,381)
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Total comprehensive income (loss) $ 7,966 $ (5,280)
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The accompanying notes are an integral part of these financial statements.
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TRIMAINE HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
(DOLLARS IN THOUSANDS)
FOR THE THREE FOR THE THREE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30, 2003 SEPTEMBER 30, 2002
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Net loss $ (9) $ (14)
Other comprehensive gain (loss):
Unrealized gain (loss) on securities, net of taxes 6,781 (1,864)
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Total comprehensive income (loss) $ 6,772 $ (1,878)
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The accompanying notes are an integral part of these financial statements.
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TRIMAINE HOLDINGS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
(DOLLARS IN THOUSANDS)
FOR THE NINE FOR THE NINE
MONTHS ENDED MONTHS ENDED
SEPTEMBER 30, 2003 SEPTEMBER 30, 2002
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Cash Flows from Operating Activities
Net income (loss) $ (109) $ 101
Adjustments to reconcile net income (loss) to
net cash used in operating activities:
Changes in operating assets and liabilities:
Real estate held for development and sale (25) (75)
Accounts payable and accrued liabilities 22 (166)
Amount due to affiliates (237) (993)
Deferred income tax liability (75) 51
Other (10) (263)
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Net cash used in operating activities (434) (1,345)
Cash Flows from Investing Activities
(Increase) decrease in note receivable 728 (718)
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Net cash provided by investing activities 728 (718)
Cash Flows from Financing Activities
Repurchases of common shares (9) (18)
Dividends paid on preferred shares (300) (300)
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Net cash used in financing activities (309) (318)
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Change in cash and cash equivalents (15) (2,381)
Cash and cash equivalents, beginning of period 3,494 5,919
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Cash and cash equivalents, end of period $ 3,479 $ 3,538
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The accompanying notes are an integral part of these financial statements.
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TRIMAINE HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 2003
(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 U.S.
Securities and Exchange Commission. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with accounting
principles generally accepted in the United States 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, 2002. 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. The results for the periods presented herein may
not be indicative of the results for the entire year.
NOTE 2. EARNINGS (LOSS) PER SHARE
Basic earnings (loss) per share is computed by dividing income (loss) available
to common shareholders by the weighted average number of common shares
outstanding in the period. The weighted average number of shares outstanding
was 15,228,340 and 15,303,435 for the nine month periods ended September 30,
2003 and 2002, respectively, and 15,221,397 and 15,285,822 for the three month
periods ended September 30, 2003 and 2002, respectively. There were no
potentially dilutive securities outstanding during the nine months and three
months ended September 30, 2003 and 2002, respectively.
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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 months and
three months ended September 30, 2003 should be read in conjunction with the
consolidated financial statements and related notes included in this quarterly
report, as well as the most recent annual report on Form 10-K for the year ended
December 31, 2002 filed with the Securities and Exchange Commission ("SEC").
RESULTS OF OPERATIONS - NINE MONTHS ENDED SEPTEMBER 30, 2003
Revenues were $14,000 for the nine months ended September 30, 2003, compared to
$356,000 for the nine months ended September 30, 2002, and consisted primarily
of income earned on investments.
Costs and expenses were $0.2 million for both the nine months ended September
30, 2003, and 2002, respectively and consisted primarily of general and
administrative expenses. Interest expense decreased marginally in the nine
months ended September 30, 2003 from the same period of 2002.
The Corporation had a net loss of $0.1 million in the nine months ended
September 30, 2003, compared to net income of $0.1 million in the same period of
2002.
RESULTS OF OPERATIONS - THREE MONTHS ENDED SEPTEMBER 30, 2003
Revenues were $8,000 for the three months ended September 30, 2003, compared to
$75,000 for the three months ended September 30, 2002, and consisted primarily
of income earned on investments.
Costs and expenses were $21,000 for the three months ended September 30, 2003,
compared to $96,000 in the same period last year, and consisted primarily of
general and administrative expenses. Interest expense decreased marginally in
the three months ended September 30, 2003 from the same period of 2002.
The Corporation had a net loss of $9,000 in the three months ended September 30,
2003, compared to $14,000 in the same period of 2002.
LIQUIDITY AND CAPITAL RESOURCES
The Corporation had cash and cash equivalents of approximately $3.5 million at
both September 30, 2003 and December 31, 2002. The Corporation had real estate
held for development and sale of $1.3 million at September 30, 2003, compared to
$1.2 million at December 31, 2002.
Operating activities used cash of $434,000 in the nine months ended September
30, 2003, compared to $1.3 million in the nine months ended September 30, 2002.
An increase in real estate held for development and sale used cash of $25,000 in
the current period, compared to $75,000 in the same period of 2002. An increase
in accounts payable and accrued liabilities provided cash of $22,000 in the nine
months ended September 30, 2003, compared to a decrease in same using cash of
$166,000 in the same period in 2002. A decrease in amounts due to affiliates
used cash of $237,000 in the
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nine months ended September 30, 2003 compared to $993,000 in the same period in
2002. Changes in other assets used cash of $10,000 in the current period,
compared to $263,000 in the comparative period in 2002.
Investing activities provided cash of $0.7 million in the nine months ended
September 30, 2003, primarily as a result of repayments received on a note
receivable. In the nine months ended September 30, 2002, the Corporation
advanced $0.7 million in connection with this note receivable.
Financing activities used cash of $0.3 million in the nine months ended
September 30, 2003 and 2002, primarily as a result of the payment of dividends
on the Corporation's preferred stock.
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.
CRITICAL ACCOUNTING POLICIES
Reference is made to the Corporation's annual report on Form 10-K for the fiscal
year ended December 31, 2002 for information concerning critical accounting
policies.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
The statements in this report that are not based on historical facts are called
"forward-looking statements" within the meaning of the United States Private
Securities Litigation Reform Act of 1995. These statements appear in a number of
different places in this report and can be identified by words such as
"estimates", "projects", "expects", "intends", "believes", "plans", or their
negatives or other comparable words. Also look for discussions of strategy that
involve risks and uncertainties. Forward-looking statements include statements
regarding the outlook for our 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. You are
cautioned that any such forward-looking statements are not guarantees and may
involve risks and uncertainties. Our actual results may differ materially from
those in the forward-looking statements due to risks facing us or due to actual
facts differing from the assumptions underlying our estimates. Some of these
risks and assumptions include those set forth in reports and other documents we
have filed with or furnished to the SEC, including in our annual report on Form
10-K for the year ended December 31, 2002. We advise you that these cautionary
remarks expressly qualify in their entirety all forward-looking statements
attributable to us or persons acting on our behalf. Unless required by law, we
do not assume any obligation to update forward-looking statements based on
unanticipated events or changed expectations. However, you should carefully
review the reports and other documents we file from time to time with the SEC.
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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, 2002 for information concerning market risk.
ITEM 4. CONTROLS AND PROCEDURES
As of the end of the period covered by this report, the Corporation carried out
an evaluation, under the supervision and with the participation of the
Corporation's principal executive officer and principal financial officer, of
the effectiveness of the design and operation of the Corporation's disclosure
controls and procedures. Based on this evaluation, the Corporation's principal
executive officer and principal financial officer concluded that the
Corporation's disclosure controls and procedures are effective in timely
alerting them to material information required to be included in its periodic
reports filed with the SEC. It should be noted that the design of any system of
controls is based in part upon certain assumptions designed to obtain reasonable
(and not absolute) assurance as to its effectiveness, and there can be no
assurance that any design will succeed in achieving its stated goals. In
addition, the Corporation reviewed its internal controls, and there have been no
significant changes in its internal controls or in other factors that could
significantly affect those controls subsequent to the date of their last
evaluation.
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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, 2002 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 16, 2003. At
the meeting, Young Soo Koo was elected as a Class II director of the Corporation
for a term expiring at the annual meeting of shareholders in 2006. The voting
results for the election of directors were as follows:
ABSTENTIONS AND
VOTES FOR VOTES WITHHELD BROKER NON-VOTES
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Young Soo Ko 10,134,277 35,730 -
Michael J. Smith and Roy Zanatta continued their terms as directors of the
Corporation after the annual meeting.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBITS
31.1 Section 302 Certification of President and Chief Financial Officer
32.1 Section 906 Certification of President and Chief Financial Officer
(b) REPORTS ON FORM 8-K
None.
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SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Dated: November 14, 2003
TRIMAINE HOLDINGS, INC.
By: /s/ Michael J. Smith
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Michael J. Smith, President, Chief
Financial Officer and Director
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