FORM 10-QSB

[As last amended in Release No. 34-32231, April 28, 1993, 58 F.R. 26509]

U.S. Securities and Exchange Commission

Washington, D.C. 20549

Form 10-QSB

(Mark One)

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2001

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE EXCHANGE ACT
For the transition period from _____________ to ________________

CINTECH SOLUTIONS, INC.
-----------------------
(Exact name of small business issuer as specified in its charter)

OHIO 31-1200684
--------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)

2100 Sherman Avenue, Cincinnati, Ohio 45212
----------------------------------------------
(Address of principal executive offices)

(513) 731-6000
--------------
(Issuer's telephone number)

N/A
------------------------------
(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
--- ---

APPLICABLE ONLY TO CORPORATE ISSUERS

1
2

State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: 12,325,727 shares of common
stock as of March 31, 2001.

Transitional Small Business Disclosure Format (check one):
Yes No X
--- ---

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.
--------------------

The condensed financial statements attached to the end of this
quarterly report are filed as part of this quarterly report (reference Exhibit
99). The financial statements include all adjustments, which in the opinion of
management are necessary in order to make the financial statements not
misleading.

Item 2. Management's Discussions and Analysis or Plan of Operation.
----------------------------------------------------------

The following selected financial information set forth below has been
derived from the unaudited condensed financial statements of the Company. This
discussion and analysis should be read in conjunction with such financial
statements. All amounts are in US dollars.

Results of Operations
- ---------------------

For the three months ended March 31, 2001 compared to the three months ended
- ----------------------------------------------------------------------------
March 31, 2000
- --------------

Sales for the three months ended March 31, 2001 were $1,253,000
compared to $2,823,000 for the same period last year. The $1,570,000 or 56%,
decrease in sales is due to a 66% decrease in Automatic Call Distribution (ACD)
revenue, a 47% decrease in other Computer Telephony Industry (CTI) revenue and a
32% decrease in services revenue.

Gross profit of $732,000 was $1,408,000, or 66%, lower than the
corresponding period of last year. This decrease in gross profit is a direct
result of the decrease in sales volume. Gross profit as a percentage of sales
was 58%, or 18% lower than that experienced during the same period of the prior
year.

Research and development costs of $233,000 were $43,000, or 22%, higher
than the comparable prior year period. Selling, general and administrative
expenses of $1,551,000 were $130,000, or 9%, higher than the comparable prior
year period.

The Company realized a loss from operations of $1,052,000, or 84%, for
the three months ended March 31, 2001 compared to income from operations of
$528,000, or 19%, reported for the same period last year.

Other income was $123,000 as compared to $103,000 for the comparable
prior year period.

The income tax benefit of $369,000 for the three months ended March 31,
2001 as compared to an income tax provision of $126,000 for the comparable prior
year period decreased as a result of lower taxable income.

2
3

The Company realized a net loss of $561,000 for the three months ended
March 31, 2001 compared to net income of $505,000 reported for the same period
last year. Loss per share, basic and diluted, was $0.05 as compared to earnings
per share, basic and diluted, of $0.04 reported for the comparable prior year
period.

For the nine months ended March 31, 2001 compared to the nine months
--------------------------------------------------------------------
ended March 31, 2000
- --------------------

Sales for the nine months ended March 31, 2001 were $6,527,000 compared
to $9,676,000 for the same period last year. The $3,149,000 or 33%, decrease in
sales is due to a 35% decrease in Automatic Call Distribution (ACD) revenue, a
43% decrease in other Computer Telephony Industry (CTI) software revenue and a
20% decrease in services revenue.

Gross profit of $4,600,000 was $2,463,000, or 35%, lower than the
corresponding period of last year. This decrease in gross profit is a direct
result of the decrease in sales volume. Gross profit as a percentage of sales
was 70%, or 3% lower than that experienced during the same period of the prior
year.

Research and development costs of $745,000 were $278,000, or 60%,
higher than the comparable prior year period. Selling, general and
administrative expenses of $4,885,000 were $684,000, or 16%, higher than the
comparable prior year period.

The Company realized a loss from operations of $1,030,000, or 16%, for
the nine months ended March 31, 2001 compared to income from operations of
$2,395,000, or 25%, reported for the same period last year.

Other income was $356,000 as compared to $229,000 for the comparable
prior year period.

The income tax benefit was $289,000 for the nine months ended March 31,
2001 as compared to an income tax provision of $591,000 for the comparable prior
year period. In the current year, the operating loss generated a tax benefit
related to operating loss carryforwards.

The Company realized a net loss of $385,000 for the nine months ended
March 31, 2001 compared to net income of $2,032,000 reported for the same period
last year. Loss per share, basic and diluted, were $0.03, versus earnings per
share, basic and diluted, of $0.17 and $0.16 respectively, reported for the
comparable prior year period.

Liquidity and Capital Resources
- -------------------------------

Working Capital decreased to $6.7 million as compared to $7.4 million
for the corresponding period of last year. The decrease of $0.7 million is
primarily due to decreases in cash and marketable securities of $1.5 million and
accounts receivable of $0.3 million while offset by an increase in deferred
income taxes of $0.2 million combined with decreases in accounts payable of $0.3
million, deferred maintenance revenue of $0.3 million and accrued wages and
compensation of $0.2 million. The decrease in cash and marketable securities
reflects the increased spending for software development combined with the
decrease in cash flow from operations experienced by the Company to date in
fiscal 2001.

3
4

As of March 31, 2001, the Company held cash and marketable securities
totaling approximately $7.0 million and had no outstanding long-term debt
obligations.

The Company's plan of operation is to continue distributing its contact
center solutions and development of services revenue. The Company has no
material commitments for capital expenditures. The Company feels that there are
no significant elements of income or loss that does not arise from the Company's
continuing operations.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings
-----------------

None

Item 2. Changes in Securities and Use of Proceeds
-----------------------------------------

None

Item 3. Defaults upon Senior Securities
-------------------------------

Not Applicable

Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------

Not Applicable

Item 5. Other Information
-----------------

None

Item 6. Exhibits and Reports on Form 8-K
--------------------------------

The following Exhibits are required by Item 601 of Regulation S-B:

Exhibit
Number Description of Document Page
------ ----------------------- ----

15 Letter on Unaudited Interim Financial Information Attached
99 Financial Statements / Independent Accountants' Report Attached

4
5

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of
1934, Cintech Solutions, Inc., as Registrant, has caused this Report on Form
10-QSB to be signed on its behalf by the undersigned, thereunto duly authorized.

CINTECH SOLUTIONS, INC.

By: /s/ Diane M. Kamionka Date: May 14, 2001
-----------------------------------
Diane M. Kamionka
President and Chief Executive Officer

By: /s/ Michael E. Freese Date: May 14, 2001
------------------------------------
Michael E. Freese
Director of Finance and Administration