FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996.
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from N/A to N/A
Commission file number 0-12984
ADVANCED TOBACCO PRODUCTS, INC.
(Exact name of registrant as specified in its charter)
TEXAS 74-2285214
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
16607 Blanco Road, Suite 1504, San Antonio, Texas 78232
(Address of principal executive offices) (Zip Code)
(210) 408-7077
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed
since last report)
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
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all
documents and reports required to be filed by Sections 12, 13 or
15(d) of the Securities Exchange Act of 1934 subsequent to the
distribution of securities under a plan confirmed by a court.
Yes No N/A
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date:
7,952,136 as of March 31, 1996
PART I - FINANCIAL INFORMATION
Item 1: Financial Statements
ADVANCED TOBACCO PRODUCTS, INC.
dba ADVANCED THERAPEUTIC PRODUCTS, INC.
BALANCE SHEETS
(Unaudited) (Audited)
March 31 June 30
1996 1995
ASSETS
CURRENT ASSETS:
Cash & cash equivalents $ 32,249 $ 86,390
Investments 333,633 316,765
Total current assets 365,882 403,155
LICENSE AGREEMENTS, Net 155,834 132,210
INVESTMENTS 959,543 959,903
Total assets $1,481,259 $1,495,268
LIABILITIES AND SHAREHOLDERS'
EQUITY:
LIABILITIES:
Accounts payable $ 2,787 $ 3,841
Accrued liabilities 20,000 15,000
Total liabilities $ 22,787 $ 18,841
SHAREHOLDERS' EQUITY:
Common stock - authorized,
30,000,000 shares of $.01
par value; 7,952,136 and
7,792,136 shares outstanding
as of March 1996, and June 1995,
respectively 79,522 77,922
Additional paid-in-capital 12,510,378 12,510,378
Accumulated deficit (11,129,828) (11,111,873)
Total stockholders' equity 1,458,472 1,476,427
Total liabilities and
stockholders' equity $1,481,259 $1,495,268
ADVANCED TOBACCO PRODUCTS, INC.
dba ADVANCED THERAPEUTIC PRODUCTS, INC.
STATEMENT OF INCOME (LOSS)
(Unaudited)
Three Months Ended March 31
1996 1995
REVENUES: $ -0- $ -0-
Total operating revenues: -0- -0-
EXPENSES:
General and administrative 18,176 19,722
Technology Maintenance Fees -0- 10,000
Total operating expenses: 18,176 29,722
INCOME (LOSS) FROM OPERATIONS (18,176) (29,722)
OTHER INCOME:
Interest Income 19,011 20,575
Total other income 19,011 20,575
NET INCOME (LOSS): $ 835 $ (9,147)
WEIGHTED AVERAGED NUMBER OF SHARES
OF COMMON STOCK OUTSTANDING 7,952,136 7,792,136
EARNINGS (LOSS) PER COMMON SHARE: NIL NIL
(Unaudited)
Nine Months Ended March 31
1996 1995
REVENUES: $ -0- $ -0-
Total operating revenues: -0- -0-
EXPENSES:
General and administrative 66,097 64,233
Technology Maintenance Fees 10,000 10,000
Total operating expenses 76,097 74,233
INCOME (LOSS) FROM OPERATIONS $(76,097) $(74,233)
OTHER INCOME:
Interest Income 58,143 79,971
Total other income 58,143 79,971
NET INCOME (LOSS): $ (17,954) $ 5,738
WEIGHTED AVERAGED NUMBER OF SHARES
OF COMMON STOCK OUTSTANDING 7,952,136 7,792,136
EARNINGS (LOSS) PER COMMON SHARE $ (.002) $ .001
ADVANCED TOBACCO PRODUCTS, INC.
dba ADVANCED THERAPEUTIC PRODUCTS, INC.
STATEMENT OF CASH FLOWS
(Unaudited)
Nine Months Ended March 31
1996 1995
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income (loss): $ (17,954) $5,738
Adjustments to reconcile net
income (loss) to net cash:
Amortization 5,010 5,010
Interest receivable -0- 3,605
Accounts payable and accrued
liabilities 3,946 3,850
Net cash provided by (8,998) 18,203
operations:
CASH FLOWS FROM INVESTING ACTIVITIES:
Maturity of certificates of deposit -0- 150,000
Capital expenses of license
agreements (28,633) (1,726)
Net cash provided by
investments: (28,633) 148,274
NET INCREASE (DECREASE) IN CASH: (37,631) 166,477
CASH & INVESTMENTS AT BEGINNING
OF PERIOD: 1,363,058 1,193,388
CASH & INVESTMENTS AT END
OF PERIOD: $1,325,427 $1,359,865
NOTES TO FINANCIAL STATEMENTS
1. The condensed financial statements included herein were
prepared by the Company without audit. Certain information and
footnote disclosures normally included in financial statements have
been omitted. The condensed financial statements should be read in
conjunction with the financial statements and the notes thereto
included in the Company's Annual Report on Form 10-K as of June 30,
1995.
Item 2: Management's Discussion and Analysis of Financial
Condition and Results of Operation
RESULTS OF OPERATIONS
In 1987, the Company sold all of its nicotine technology to an
entity owned or controlled by Pharmacia AB ("Pharmacia"), a
worldwide pharmaceutical company headquartered in Sweden that
manufactured the Nicorette chewing gum and the nicotine transdermal
patch.
Since 1987, the Company has worked jointly with Pharmacia to
develop a nicotine vaporizer product for smoking cessation which
commenced clinical and pivotal trials in late 1990. During the
fiscal year 1994, Pharmacia filed new drug applications (NDA's)
with the respective regulatory agencies in several major European
countries. After including additional data in the filing which
Pharmacia believes will facilitate the United States Food and Drug
Administration (FDA) review process, Pharmacia intends to file an
NDA with the FDA during the first half of calendar year 1996.
The Company has learned that McNeil Consumer Products has been
granted exclusive North American marketing rights by Pharmacia
regarding Pharmacia's nicotine vapor inhaler smoking cessation
product.
During the nine-month period ended March 31, 1996, the
Company's only source of revenues has been from interest income.
LIQUIDITY AND CAPITAL RESOURCES
Cash resources, including investments, available on March 31,
1996, were approximately $1,325,425, as compared to $1,359,865, for
March 31, 1995. The reduction in cash resources reflects the use
of cash for capital expenses for license agreements.
COMPARISON OF SELECTED FINANCIAL DATA
Interest income for the nine-month period ended March 31,
1996, was $58,143 as compared to $79,971 for the nine-month period
ended March 31, 1995. This decrease is due to a fluctuation in
interest rates.
The Company experienced a net loss for the nine-month period
ended March 31, 1996 of ($17,954) compared to a net profit of
$5,758 for the nine-month period ended March 31, 1995, due
primarily to decreased interest income.
General and administrative expenses were $66,097 for the nine-
month period ended March 31, 1996, compared to $64,233 for the
nine-month period ended March 31, 1995.
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
None
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.
ADVANCED TOBACCO PRODUCTS, INC.
(Registrant)
Dated: May 14, 1996
By: J. W. Linehan
J.W. Linehan, President,
Chief Financial Officer and
Chief Accounting Officer
ABB0D050