UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
(Mark One)
XX QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
- --- ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2002
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
- --- ACT OF 1934 FOR THE TRANSITION PERIOD FROM _______ TO ______.
Commission file number 000-24991
____________________
ALLSTATES WORLDCARGO, INC.
-------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
New Jersey 22-3487471
-------------- -------------------------------
(State or other jurisdiction (IRS Employer Identification No.)
of incorporation)
4 Lakeside Drive South, Forked River, New Jersey, 08731
----------------------------------------------------------
(Address of principal executive offices)
609-693-5950
--------------------------------------------------
(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 Exchange Act 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 XX No
---- ----
The Company had 32,509,872 shares of common stock, par value $.0001 per
share, outstanding as of May 10, 2001.
1
ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES
INDEX
PAGE
PART 1. FINANCIAL INFORMATION ----
ITEM 1. FINANCIAL STATEMENTS
Financial Statements with Supplemental Information
For the Period Ending March 31, 2002 and 2001
Financial Statements:
Condensed Consolidated Balance Sheet.................................3
Condensed Consolidated Statement of Operations.......................4
Condensed Consolidated Statements of
Stockholders' Equity (Deficit)...................................5
Condensed Consolidated Statement of Cash Flows.......................6
Notes to the Financial Statements......................................7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS........................8
PART II. OTHER INFORMATION.............................................13
ITEM 1 LEGAL PROCEEDINGS..........................................13
ITEM 2 CHANGES IN SECURITIES AND USE OF PROCEEDS..................13
ITEM 3 DEFAULTS ON SENIOR SECURITIES..............................13
ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS........13
ITEM 5 OTHER INFORMATION..........................................13
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K...........................13
SIGNATURES........................................................15
2
ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
ASSETS
March 31, September
30,
2002 2001
(Unaudited) *
Current Assets
Cash and cash
equivalents $ 450,696 $ 623,925
Accounts receivable 4,140,876 4,164,432
Prepaid taxes 125,844 48,977
Prepaid expenses and
other current assets 800,378 774,129
Deferred income taxes 118,038 118,038
Loan receivable -
related party 200,000 200,000
---------- ----------
Total current assets 5,835,832 5,929,501
Property, plant and
equipment 1,344,159 1,452,999
Less: Accumulated
depreciation 864,447 857,592
---------- ----------
Net property, plant and
equipment 479,712 595,407
Goodwill 504,016 504,016
Other assets 60,872 65,753
---------- ----------
Total assets $6,880,432 $7,094,677
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable $2,664,356 $2,562,260
Accrued expenses 720,106 1,016,270
Short-term bank
borrowings 900,000 900,000
Notes payable 115,532 131,325
Deferred tax liability 4,038 4,038
---------- ----------
Total current liabilities 4,404,032 4,613,893
Long term portion of notes
payable 2,455,951 2,496,904
Stockholders' equity
(deficit)
Common stock 3,251 3,251
Retained earnings
(deficit) 17,198 (19,371)
---------- ----------
Total stockholders' equity 20,449 (16,120)
Total liabilities and
stockholders' equity $6,880,432 $7,094,677
========== ==========
* Condensed from audited financial statements.
The accompanying notes are an integral part of these
consolidated financial statements.
3
ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
Three Months Ended Six Months Ended
March 31, March 31,
2002 2001 2002 2001
---------- ---------- ----------- -----------
Revenues (net of
discounts) $ 7,788,839 $11,560,713 $16,140,067 $23,781,744
Cost of transportation 4,714,649 6,214,643 9,816,891 13,402,576
---------- ---------- ----------- -----------
Gross profit 3,074,190 5,346,070 6,323,176 10,379,168
Selling, general and
administrative expenses 2,987,675 5,085,454 6,147,824 9,666,108
---------- ---------- ----------- -----------
Income from operations 86,515 260,616 175,352 713,060
Other income (expense):
Interest, net (52,103) ( 57,155) (105,642) (117,135)
Gain/(loss) on sale
of assets (5,052) 157,711 (7,563) 160,011
Other income 39 6,250 1,455 17,232
---------- ---------- ----------- -----------
Income before income tax
provision 29,399 367,422 63,602 773,168
Provision for income
taxes 12,533 173,530 27,033 362,912
Net income $ 16,866 $193,892 $ 36,569 $ 410,256
========== ========== =========== ===========
Weighted average common
shares - basic 32,509,872 32,509,872 32,509,872 32,509,872
Net income per common
share - basic $ .00 $ .00 $ .00 $ .01
Weighted average common
shares - diluted 32,509,872 32,509,872 32,509,872 32,510,812
Net income per common
share - diluted $ .00 $ .00 $ .00 $ .01
The accompanying notes are an integral part of these
consolidated financial statements.
4
ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(DEFICIT)
(Unaudited)
<c> <c> <c> <c> <c>
Common Stock
Other Retained Total
Number Comprehen Earnings Stockholders'
of Par sive (Deficit) Equity
Shares Value Income (Deficit)
(Loss)
___________ ______ _________ _________ _________
Balance at 32,509,872 3,251 $ 0 $( 19,371) $(16,120)
September 30, 2001
Consolidated net
income for the
six months ended
March 31, 2002 36,569 36,569
___________ ______ _________ _________ _________
Balance at March
31, 2002 32,509,872 $3,251 $ 0 $ 17,198 $ 20,449
=========== ====== ========= ========= =========
5
ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
Six Months Ended
March 31,
2002 2001
Cash flows from operating
activities:
Net income 36,569 410,256
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation 110,625 119,729
Amortization 2,332 34,165
Provision for doubtful
accounts 55,853 76,223
(Gain)/loss on sale of assets 7,563 (160,011)
Deferred income taxes
(Increase) decrease in assets:
Accounts receivable (32,297) (167,772)
Prepaid expenses and other
assets (103,116) (455,935)
Increase (decrease) in
liabilities:
Accounts payable and
accrued expenses (194,069) 14,965
Income tax payable 76,837
--------- --------
Net cash used for by operating
activities (116,540) (51,543)
Cash flows from investing
activities:
Purchase of equipment (33,596) (123,983)
Proceeds from sale of property
and equipment 31,103 195,513
Cash received from e-tail
Logistics stock subscriptions 1,199
Security deposits 2,550 37,034
--------- --------
Net cash provided by investing
activities 57 109,763
Cash flows from financing
activities:
Repayments under notes payable (56,746) (74,771)
Repayments under short-term
bank borrowings
Borrowing under short-term bank
borrowings 200,000
Net cash (used for)/provided by
financing activities (56,746) 125,229
Net (decrease)/increase in cash
and cash equivalents (173,229) 183,449
Currency translation adjustments 5,638
Cash and cash equivalents,
beginning of year 623,925 115,736
--------- --------
Cash and cash equivalents, end of
period $ 450,696 $ 304,823
========= =========
The accompanying notes are an integral part of
these consolidated financial statements.
6
ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 2002
1. The accompanying unaudited condensed consolidated
financial statements have been prepared by Allstates
WorldCargo, Inc. (the "Company") in accordance with the
rules and regulations of the Securities and Exchange
Commission (the "SEC") for interim financial statements and
accordingly do not include all information and footnotes
required under generally accepted accounting principles for
complete financial statements. The financial statements
have been prepared in conformity with the accounting
principles and practices disclosed in, and should be read in
conjunction with, the annual financial statements of the
Company included in the Company's Fiscal year 2001 Form 10-K
filing dated December 28, 2001 (File No. 000-24991). In the
opinion of management, these interim financial statements
contain all adjustments necessary for a fair presentation of
the Company's financial position at March 31, 2002 and 2001,
and the results of operations for the three and six months
ended March 31, 2002 and 2001, respectively.
2. Net income per common share appearing in the statements
of operations for the three and six months ended March 31,
2002 and 2001, respectively have been prepared in accordance
with Statement of Financial Accounting Standards No. 128
("SFAS No. 128"). SFAS No. 128 establishes standards for
computing and presenting earnings per share ("EPS") and
requires the presentation of both basic and diluted EPS. As
a result primary and fully diluted EPS have been replaced by
basic and diluted EPS. Such amounts have been computed
based on the profit or (loss) for the respective periods
divided by the weighted average number of common shares
outstanding during the related periods.
3. Beginning with the quarter ended December 31, 2001,
the financial statements of the Company have been prepared
in accordance with FASB Statement No. 142, Accounting for
Goodwill and Intangible Assets, which no longer allows for
the amortization of goodwill. The new statement will
require the Company to conduct an annual goodwill impairment
test and write off any decrease in the fair value of the
goodwill in the period of such declined value.
7
ITEM 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
General Overview
Allstates WorldCargo, Inc. (the "Company" or
"Allstates") is a New Jersey Corporation formed on January
14, 1997 as Audiogenesis Systems, Inc. ("Audiogenesis"),
pursuant to a corporate reorganization of Genesis Safety
Systems, Inc. On August 24, 1999, Audiogenesis acquired 100
percent of the common stock of Allstates Air Cargo, Inc. in
a reverse acquisition, and on November 30, 1999, changed its
name to Allstates WorldCargo, Inc. The Company's business
is comprised of freight forwarding and the distribution and
sales of safety equipment. Allstates is headquartered in
Forked River, New Jersey.
The freight forwarding business of Allstates opened its
first terminal in Newark, New Jersey in 1961. Allstates
provides domestic and international freight forwarding
services to over 1,500 customers utilizing ground
transportation, commercial air carriers, and ocean vessels.
Allstates operates 20 offices throughout the United States,
and employs 87 people.
Allstates has agreements with domestic and
international strategic partners and a network of agents
throughout the world. Allstates plans to increase its
global market share by forming additional strategic
alliances and effecting selective acquisitions.
In September, 2000, Allstates entered in to an
agreement with an unrelated freight and warehousing company
to provide them services which primarily include customer
invoicing and transportation vendor disbursements on
business that they provide to the Company. Per the
agreement, Allstates paid a commission to this company based
on the invoiced amount, less deductions for transportation
cost and a fee for providing the service. In May, 2001, the
assets of that company were purchased by another company
unrelated to Allstates WorldCargo, Inc., and consequently
the service agreement was terminated.
Results of Operations
The following table sets forth for the periods
indicated certain financial information derived from the
Company's consolidated statement of operations expressed as
a percentage of net sales:
Three Months Ended Six Months Ended
March 31, March 31,
2002 2001 2002 2001
---- ---- ---- ----
Revenues 100.0% 100.0% 100.0% 100.0%
Cost of transportation 60.5 53.8 60.8 56.4
---- ---- ---- ----
Gross profit 39.5 46.2 39.2 43.6
Selling, general and
administrative expenses 38.4 44.0 38.1 40.6
---- ---- ---- ----
Operating income 1.1 2.2 1.1 3.0
==== ==== ==== ====
Net income 0.2% 1.7% 0.2% 1.7%
8
Revenues
Revenues of the Company represents gross consolidated
sales less customer discounts. For the three months ended
March 31, 2002, total revenues decreased by $3,772,000, or
32.6%, to $7,789,000, from the three month period ended
March 31, 2001, reflecting a reduced volume of shipments and
total weight of cargo shipped. Revenues decreased by
$7,642,000, or 32.1%, to $16,140,0000 during the six month
period ended March 31, 2002 as compared to the six months
ended March 31, 2001.
Comparative sales from the three month and six month
periods ended March 31, 2001 included domestic and
international revenues that were generated from one customer
that accounted for 10.8% and 16.5% of total sales during
those respective periods. Effective October 1, 2001, that
customer, in an effort to minimize their operating costs,
began utilizing a larger alternate freight forwarder to
service their international import freight requirements.
Import sales to that customer amounted to approximately
$642,000 and $1,834,000 during the three and six month
periods ended March 31, 2001. Allstates continues to
provide domestic freight forwarding services to this
customer. In addition, comparative revenue for the three
month period ended March 31, 2001 included sales generated
from one other customer, which Allstates no longer services,
that accounted for 9.1% of total revenue for that period.
Domestic revenues decreased by approximately $2.2
million or 27.1%, to $6,010,000 during the three-month
period ended March 31, 2002 in comparison to the same period
in the prior year. For the six month period ended March 31,
2002, domestic revenues decreased by approximately $5.1
million or 29.3%, to $12,235,000 from the same period in the
previous year. Comparative sales for the three and six
month periods ended March 31, 2001 included approximately
$1.1 million and $2.2 million respectively, in new business
that was derived from the Company's service agreement with
an unrelated freight and warehouse services company. That
agreement was terminated in May 2001 pursuant to the sale of
the assets of that company to another unrelated company.
International sales decreased during the three months ended
March 31, 2002 by approximately $1.5 million or 46.4%, to
$1,778,000, and during the six month period then ended
decreased by approximately $2.6 million or 39.7%, to
$3,905,000, reflecting the loss of import business from the
significant customer as previously mentioned. Sales to
international customers accounted for 24.2% of total sales
during the six months ended March 31, 2002 as compared to
27.2% of total sales during the six months ended March 31,
2001.
In addition to the specific reasons that have been
mentioned for the comparative decrease in revenues between
the three and six month periods ended March 31, 2002 and
2001, respectively, the Company's sales volume during those
periods was adversely effected by the catastrophic events
that took place on September 11, 2001.
Gross Profit
Gross profit represents the difference between net
revenues and the cost of sales. The cost of sales is
composed primarily of amounts paid by the Company to
carriers and cartage agents for the transport of cargo.
Cost of sales as a percentage of revenues increased by 6.7%
for the three months ended March 31, 2002, and increased by
4.4% for the six month period then ended, in comparison to
the same periods in the previous year. The comparative
three and six month periods of the previous fiscal year
yielded a lower percentage cost of sales primarily due to
the effect of the business that was derived from the
Company's aforementioned service agreement with an unrelated
freight and warehouse services company, for which their was
no related cost of sales on the warehousing portion of that
billing. As previously indicated, that agreement was
terminated in May 2001. In absolute terms, the cost of
sales decreased by approximately $1.5 million or 24.1%, to
$4,715,000 during the three months ended March 31, 2002, and
by approximately $3.6 million or 26.8%, to $9,817,000 versus
the comparative periods in the prior year, reflecting the
reduced sales volume. Gross margins decreased to 39.5%
during the quarter ended March 31, 2002 from 46.2% in the
same quarter of the previous fiscal year, and decreased to
39.2% during the six months then ended from 43.6% during the
comparative period of the prior year. Gross profit
decreased by approximately $2.3 million, to $3,074,000 for
the three months ended March 31, 2002 versus the same three
months of the prior year, and decreased by approximately
$4.1 million, to $6,323,000 during the six month comparative
periods then ended.
9
Selling, General and Administrative Expenses
SG&A expenses decreased as a percentage of sales by
5.6% for the three months ended March 31, 2002 compared to
the three months ended March 31, 2001, to 38.4%, primarily
reflecting the combination of lower commissions expense as a
percent of revenues during the period, offset by the effect
of lower sales volume in relation to fixed operating costs.
In absolute terms, operating expenses decreased by
approximately $2,098,000 or 41.3% during the three-month
period ended March 31, 2002 as compared to the same period
in the prior fiscal year. The decrease in SG&A expenses
reflects the lower volume of revenues and gross profit
during the quarter, primarily represented by lower
commissions expense, as well as the effect of certain cost
saving initiatives executed by the Company.
During the six months ended March 31, 2002, operating
expenses decreased by 2.5% as compared to the six months
ended March 31, 2001, to 38.1%, again reflecting lower
commissions expense in relation to revenues for the period,
offset by lower sales in relation to fixed operating
expenses. Actual operating expenses decreased by
approximately $3,518,000 or 36.4% during the six months
ended March 31, 2002 in comparison to the same period of the
previous year, for the same reasons indicated in the three
month comparison.
Commissions paid to licensees decreased by
approximately $686,000 and $1,046,000 respectively for the
three and six month periods ended March 31, 2002 in
comparison to the same periods in the previous year,
reflecting the reduced level of gross profits at certain
licensee operations. Additionally, during the comparative
three and six month periods ended March 31, 2001 the Company
paid approximately $870,000 and $1,623,000 respectively in
commissions to an unrelated freight and warehousing services
company pursuant to an agreement made between them and
Allstates. That agreement was subsequently terminated in
May 2001.
Since the fourth quarter of fiscal 2001, Allstates has
taken steps to reduce operating expenses in response to the
lower volume of sales. The Company reduced headcount at two
locations, consolidated the operations of one of its offices
with another station, and eliminated three positions within
the corporate staff. The Company realized cost savings of
approximately $150,000 during the three months ended March
31, 2002 and approximately $280,000 for the six months then
ended as a result of these initiatives.
SG&A expenses presented for the three months ended
March 31, 2002 and 2001 are inclusive of expenditures to
related parties totaling $113,607 and $192,646,
respectively. For the six months ended March 31, 2002 and
2001, expenditures to related parties totaled $113,607 and
$192,646, respectively.
Income/(Loss) From Operations
Income from operations decreased during the three
months ended March 31, 2002 by approximately $174,000, to
$87,000, and decreased by approximately $538,000, to
$175,000, as compared to the same three and six month
periods in the previous year for the reasons indicated
above. Operating margins for both the three and six month
periods ended March 31, 2002 decreased by 1.1% and 1.9%
respectively in comparison to the respective periods in
fiscal 2001, to 1.1% of sales.
Net Interest Expense
Net interest expense decreased for the three and six
month periods ended March 31, 2002 by approximately $5,000
and $11,000 respectively, as compared to the same periods in
the previous year, reflecting the effect of lower interest
rates on the Company's bank line of credit.
10
Gain/(Loss) on Sale of Assets
During the prior fiscal year's quarter ended March 31,
2001, Allstates realized a gain on the sale of property that
the Company co-owned with the Chairman, Joseph Guido. The
property was sold on January 11, 2001 and the proceeds of
the sale were allocated between Mr. Guido and Allstates
WorldCargo. The Company's portion of the net proceeds after
closing costs was $184,005.98, of which a gain of
approximately $153,000 was realized. The total gain on the
sale of assets for the three and six months ended March 31,
2001 was approximately $158,000 and $160,000, respectively.
Net Income/(Loss)
Income before income taxes decreased to $29,000 during
the quarter ended March 31, 2002 from $367,000 during the
same period in the prior year. The Company recorded a
provision for taxes of approximately $13,000 for the quarter
ended March 31, 2002 as compared to a tax provision of
$174,000 for quarter ended March 31, 2001. The net profit
amounted to approximately $17,000 or 0.2% of revenues during
the second quarter of Fiscal 2002 versus a net profit of
$194,000 or 1.7% of revenues in the second quarter of Fiscal
2001.
For the six months ended March 31, 2001, income before
income taxes decreased to $64,000 from $773,000 during the
same period in the prior year. The Company recorded a
provision for taxes of approximately $27,000 for the six
months ended March 31, 2002 as compared to a tax provision
of $363,000 for six months ended March 31, 2001. The net
profit amounted to approximately $37,000 or 0.2% of revenues
during the first six months of Fiscal 2002 versus a net
profit of $410,000 or 1.7% of revenues for the same period
in Fiscal 2001.
Liquidity and Capital Resources
Net cash used for operating activities was
approximately $117,000 for the six months ended March 31,
2002, while cash used for operations was approximately
$52,000 for the six months ended March 31, 2001. During the
six months ended March 31, 2002, cash was primarily used to
satisfy trade accounts payable and income tax obligations,
offset by the net income of the Company. For the six months
ended March 31, 2001, cash was used primarily to finance an
increase in accounts receivable and to extend a short term
loan to an unrelated freight and warehouse services company,
offset by the net income of the Company.
At March 31, 2002, the Company had cash and cash
equivalents of $451,000 and net working capital of
$1,432,000, compared with cash and cash equivalents of
$305,000 and net working capital of $1,050,000 respectively,
at March 31, 2001. The increase in working capital at March
31, 2002 over March 31, 2001 is attributable to the net
income of the Company during the prior twelve month period
in addition to the reclassification of an officer's loan as
a current receivable.
The Company's investing activities were comprised of
expenditures for capital equipment, primarily representing
purchases of computer hardware and software. For the six
months ended March 31, 2002, capital expenditures amounted
to approximately $34,000. For the six months ended March
31, 2001, capital expenditures amounted to approximately
$140,000, of which approximately $20,000 was acquired
through notes payable. In March 2001, Allstates received
proceeds from the sale of real estate that was partially
owned by the Company totaling approximately $184,000.
The Company has a commercial line of credit with a
bank, pursuant to which the Company may borrow up to
$2,000,000, based on a maximum of 70% of eligible accounts
receivable. Per the agreement, interest on outstanding
borrowings accrues at the Wall Street Journal's prime rate
of interest (4.75% at March 31, 2002). The interest rate is
predicated on the Company maintaining a compensating account
balance in a non-interest bearing account equal to at least
10% of the outstanding principal balance. If such average
compensating balances are not maintained, the interest rate
will increase by 1% over the rate currently accruing. As of
March 31, 2002, there was $900,000 of outstanding borrowings
on the line of credit.
11
In September, 2000, Allstates extended an operating
loan to an unrelated freight and warehouse services company,
Q Logistics Solutions, Inc. ("QLS"), as part of an agreement
that the Company entered into to provide customer invoicing
and vendor disbursement services. The loan was secured by a
$750,000 promissory note signed by the borrower, and for
which a Form UCC-1 financing statement was filed. In
February 2001, QLS filed for Chapter 11 protection under the
U.S. bankruptcy laws. Pursuant to the bankruptcy
proceedings, another company, unrelated to Allstates
WorldCargo, Inc., purchased the assets of QLS in May 2001.
Allstates had outstanding loan advances of approximately
$702,000 to QLS prior to the purchase. As a contingency of
that purchase, Allstates entered in to an agreement with the
other company whereby Allstates assigned the Form UCC-1
filing to them in exchange for their promissory note,
secured by a personal guarantee made by an officer of that
company, to pay the full loan amount of approximately
$702,000, plus 9% interest over six months, beginning in
April 2001. The other company subsequently defaulted on the
loan and as of the date of this filing has not made any
payments to Allstates. Allstates has filed suit against the
other company for breach of contract, and will continue to
pursue the matter. No assurance can be made at this time
with respect to the recoverability of any or all funds due
to Allstates.
Forward Looking Statements
The statements contained in all parts of this document
including, but not limited to, those relating to the
availability of cargo space; the Company's overseas presence
and the plans for, effects, results and expansion of
international operations and agreements for international
cargo; future international revenue and international market
growth; the future expansion and results of the Company's
terminal network; plans for local delivery services and
truck brokerage; future improvements in the Company's
information systems and logistic systems and services;
technological advancements; future marketing results;
construction of the new facilities; the effect of
litigation; future costs of transportation; future operating
expenses; future margins; any seasonality of the Company's
business; future dividend plans; future acquisitions and the
effects, benefits, results, terms or other aspects of any
acquisition, effects of the Year 2000 issue; Ocean
Transportation Intermediary License; ability to continue
growth and implement growth and business strategy; the
ability of expected sources of liquidity to support working
capital and capital expenditure requirements; future
expectations; and any other statements regarding future
growth, future cash needs, future terminals, future
operations, business plans, future financial results,
financial targets and goals; and any other statements which
are not historical facts are forward-looking statements.
When used in this document, the words "anticipate,"
"estimate," "expect," "may," "plans," "project" and similar
expressions are intended to be among the statements that
identify forward-looking statements. Such statements involve
risks and uncertainties, including, but not limited to,
those relating to the Company's dependence on its ability to
attract and retain skilled managers and other personnel; the
intense competition within the freight industry; the
uncertainty of the Company's ability to manage and continue
its growth and implement its business strategy; the
Company's dependence on the availability of cargo space to
serve its customers; the effects of regulation; results of
litigation; the Company's vulnerability to general economic
conditions; the control by the Company's principal
shareholder; risks of international operations; risks
relating to acquisitions; the Company's future financial and
operating results, cash needs and demand for its services;
and the Company's ability to maintain and comply with
permits and licenses, as well as other factors detailed in
this document and the Company's other filings with the
Securities and Exchange Commission. Should one or more of
these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual outcomes may
vary materially from those indicated. The Company undertakes
no responsibility to update for changes related to these or
any other factors that may occur subsequent to this filing.
12
PART II
OTHER INFORMATION
- ------------------
ITEM 1 LEGAL PROCEEDINGS
There have been no material developments concerning the
Company's involvement in an ongoing environmental proceeding as set forth
in the Company's Form 10-K dated September 30, 2001, and
such information is incorporated herein by reference.
ITEM 2 CHANGES IN SECURITIES
NONE
ITEM 3 DEFAULTS ON SENIOR SECURITIES
NONE
ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
NONE
ITEM 5 OTHER INFORMATION
NONE
13
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
None
(b) Reports on Form 8-K
None
14
SIGNATURES
Pursuant to the requirements of the Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
ALLSTATES WORLDCARGO, INC.
BY: /s/ SAM DIGIRALOMO DATED: May 14, 2002
--------------------------------- ------------
Sam DiGiralomo, President and CEO
BY: /s/ Craig D. Stratton DATED: May 14, 2002
--------------------------------- ------------
Craig D. Stratton, CFO, Secretary,
Treasurer and Principal Financial Officer
15