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 JUNE 30, 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 August 13, 2002.
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 June 30, 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
June 30, September
30,
2002 2001
(Unaudited) *
Current Assets
Cash and cash
equivalents $ 420,699 $ 623,925
Accounts receivable
4,818,347 4,164,432
Prepaid taxes 118,172 48,977
Prepaid expenses and
other current assets 808,062 774,129
Deferred income taxes 118,038 118,038
Loan receivable -
related party 200,000 200,000
--------- ---------
Total current assets 6,483,318 5,929,501
Property, plant and
equipment 1,387,965 1,452,999
Less: Accumulated
depreciation 914,084 857,592
--------- ---------
Net property, plant and
equipment 473,881 595,407
Goodwill 504,016 504,016
Other assets 67,502 65,753
--------- ---------
Total assets $7,528,717 $7,094,677
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable $3,207,177 $2,562,260
Accrued expenses 567,357 1,016,270
Short-term bank
borrowings 1,100,000 900,000
Notes payable 97,933 131,325
Deferred tax liability 4,038 4,038
--------- ---------
Total current liabilities 4,976,505 4,613,893
Long term portion of notes
payable 2,422,371 2,496,904
Stockholders' equity
(deficit)
Common stock 3,251 3,251
Retained earnings
(deficit) 126,590 (19,371)
--------- ---------
Total stockholders' equity
(deficit) 129,841 (16,120)
Total liabilities and
stockholders' equity
(deficit) $7,528,717 $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 Nine Months Ended
June 30, June 30,
2002 2001 2002 2001
Revenues (net of
discounts) $9,478,739 9,187,421 $25,618,806 $32,969,165
Cost of transportation 5,757,277 5,359,051 15,574,168 18,761,627
--------- --------- ---------- ----------
Gross profit 3,721,462 3,828,370 10,044,638 14,207,538
Selling, general and
administrative expenses 3,477,435 3,795,568 9,625,259 13,461,676
--------- --------- ---------- ----------
Income from operations 244,027 32,802 419,379 745,862
Other income (expense):
Interest, net (54,228) (66,254) (159,870) (183,389)
Gain/(loss) on sale of
assets (3,629) (5,017) (11,192) 154,994
Other income/(expense) 51 7,666 1,506 24,898
--------- --------- ---------- ----------
Income before income tax
provision 186,221 (30,803) 249,823 742,365
Provision for income
taxes 76,829 (41,218) 103,862 321,694
Net income $ 109,392 $ 10,415 $145,961 $420,671
========= ========= ========== ==========
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 32,510,509
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
nine months ended
June 30, 2002 145,961 145,961
___________ ______ _________ _________ _________
Balance at June
30, 2002 32,509,872 $3,251 $ 0 $126,590 $ 129,841
=========== ====== ========= ========= =========
The accompanying notes are an integral part of these
consolidated financial statements.
5
ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
Nine Months Ended
June 30,
2002 2001
Cash flows from operating
activities:
Net income $145,961 $ 420,671
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation 163,418 185,542
Amortization 3,498 51,247
Provision for doubtful
accounts 83,980 112,600
(Gain)/loss on sale of assets 11,192 (154,994)
Deferred income taxes
(Increase) decrease in assets:
Accounts receivable
(737,895) 1,243,771
Prepaid expenses and other
assets (103,127) (562,315)
Increase (decrease) in
liabilities:
Accounts payable and
accrued expenses 196,002 (1,099,720)
Income tax payable (20,480)
--------- ----------
Net cash (used for)/provided by
operating activities (236,971) 176,322
Cash flows from investing
activities:
Purchase of equipment (84,188) (144,495)
Proceeds from sale of property
and equipment 31,103 207,589
Cash received from e-tail
Logistics stock subscriptions 1,199
Security deposits (5,245) 38,434
--------- ----------
Net cash (used for)/provided by
investing activities (58,330) 102,727
Cash flows from financing
activities:
Repayments under notes payable (107,925) (137,861)
Borrowing under short-term bank
borrowings 200,000 200,000
--------- ----------
Net cash provided by financing
activities 92,075 62,139
Net (decrease)/increase in cash
and cash equivalents (203,226) 341,188
Currency translation adjustments 1,067
Cash and cash equivalents,
beginning of year 623,925 115,736
--------- ----------
Cash and cash equivalents, end of
period 420,699 457,991
========= ==========
The accompanying notes are an integral part of
these consolidated financial statements.
6
ALLSTATES WORLDCARGO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 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 June 30, 2002 and 2001,
and the results of operations for the three and nine months
ended June 30, 2002 and 2001, respectively.
2. Net income per common share appearing in the statements
of operations for the three and nine months ended June 30,
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 conducts operations through a combination of 11
company-owned offices and 10 licensee offices throughout the
United States, and employs 97 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 Nine Months Ended
June 30, June 30,
2002 2001 2002 2001
---- ---- ---- ----
Revenues 100.0% 100.0% 100.0% 100.0%
Cost of transportation 60.7 58.3 60.8 56.9
---- ---- ---- ----
Gross profit 39.3 41.7 39.2 43.1
Selling, general and
administrative expenses 36.7 41.3 37.6 40.8
---- ---- ---- ----
Operating income 2.6 0.4 1.6 2.3
==== ==== ==== ====
Net income 1.2% 0.1% 0.6% 1.3%
8
Revenues
Revenues of the Company represents gross consolidated
sales less customer discounts. Total revenues increased
during the three months ended June 30, 2002 by $291,000, or
3.2%, to $9,479,000, over the three month period ended June
30, 2001, reflecting a greater volume of shipments and total
weight of cargo shipped. Revenues for the nine month period
ended June 30, 2002 decreased by $7,350,000, or 22.3%, to
$25,619,000 as compared to the nine months ended June 30,
2001, due to a lower volume and weight of cargo shipments.
Comparative sales from the nine month period ended
June 30, 2001 included domestic and international revenues
that were generated from one customer that accounted for
13.8% of total sales during that period. 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 $2,050,000 during the nine month period ended
June 30, 2001. Allstates continues to provide domestic
freight forwarding services to this customer.
Domestic revenues increased by approximately $585,000
or 8.7%, to $7,296,000 during the three-month period ended
June 30, 2002 in comparison to the same period in the prior
year, reflecting the net growth in shipping volume, led by
the addition of two new company stations. For the nine
month period ended June 30, 2002, domestic revenues
decreased by approximately $4.5 million or 18.7%, to
$19,531,000 in comparison to the same period in the previous
year. Comparative sales for the three and nine month
periods ended June 30, 2001 included approximately $0.3
million and $2.6 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
June 30, 2002 by approximately $294,000 or 11.9%, to
$2,183,000, and during the nine month period then ended
decreased by approximately $2.9 million or 32.0%, to
$6,088,000, reflecting the loss of import business from the
significant customer as previously mentioned. Sales to
international customers accounted for 23.7% of total sales
during the nine months ended June 30, 2002 as compared to
27.2% of total sales during the nine months ended June 30,
2001.
In addition to the specific reasons that have been
mentioned for the comparative decrease in revenue between
the nine month period ended June 30, 2002 and 2001,
respectively, the Company's sales volume during that period
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 2.4%
for the three months ended June 30, 2002, and increased by
3.9% for the nine month period then ended, in comparison to
the same periods in the previous year. The comparative
three and nine 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 when compared the
same periods in the prior year, the cost of sales increased
by approximately $400,000 or 7.4%, to $5,757,000 during the
three months ended June 30, 2002, and decreased by
approximately $3.2 million or 17.0%, to $15,574,000 during
the nine month period then ended, reflecting the comparative
changes in sales volume during those periods. Gross margins
decreased to 39.3% during the quarter ended June 30, 2002
from 41.7% in the same quarter of the previous fiscal year,
and decreased to 39.2% during the nine months then ended
from 43.1% during the comparative period of the prior year.
Gross profit decreased by approximately $107,000, to
$3,721,000 for the three months ended June 30, 2002 versus
the same three months of the prior year, and decreased by
approximately $4.2 million, to $10,045,000 during the nine
month comparative periods then ended.
9
Selling, General and Administrative Expenses
SG&A expenses decreased as a percentage of sales by
4.6% for the three months ended June 30, 2002 compared to
the three months ended June 30, 2001, to 36.7%, primarily
reflecting lower commissions expense as a percent of
revenues during the period. In absolute terms, operating
expenses decreased by approximately $318,000 or 8.4% during
the three-month period ended June 30, 2002 as compared to
the same period in the prior fiscal year, primarily
reflecting lower commissions expenses, offset by an increase
in personnel expenses.
During the nine months ended June 30, 2002, operating
expenses decreased by 3.2% as compared to the nine months
ended June 30, 2001, to 37.6%, 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 $3,836,000 or
28.5% during the nine months ended June 30, 2002 in
comparison to the same period of the previous year,
reflecting lower commissions expense as well as the effect
of certain cost saving initiatives executed by the Company.
Commissions and royalties paid pursuant to licensee
agreements decreased by approximately $151,000 and
$1,300,000 respectively for the three and nine month periods
ended June 30, 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 nine month period ended June 30, 2001 the
Company paid approximately $1,851,000 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.
Beginning in the fourth quarter of fiscal 2001,
and continuing into the first and second quarters of fiscal
2002, Allstates took 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. As a result of
these initiatives, the Company realized cost savings of
approximately $180,000 during the three months ended June
30, 2002 and approximately $460,000 for the nine months then
ended. During the quarter ended June 30, 2002, personnel
expenses increased by approximately $88,000 over the quarter
ended June 30, 2001. Allstates opened two company-owned
stations in Florida where there had been no presence in
recent years, and also increased sales staff in existing
locations.
SG&A expenses presented for the three months ended June
30, 2002 and 2001 are inclusive of expenditures to related
parties totaling $96,646 and $119,990, respectively. For
the nine months ended June 30, 2002 and 2001, expenditures
to related parties totaled $289,122 and $487,688,
respectively.
Income From Operations
Income from operations increased during the three
months ended June 30, 2002 by approximately $211,000, to
$244,000, and during the nine months then ended decreased by
approximately $326,000, to $419,000, as compared to the same
three and nine month periods in the previous year for the
reasons indicated above. Operating margins for the three
months ended June 30, 2002 increased by 2.2%, to 2.6% of
sales, and decreased by 0.7%, to 1.6% of sales for the nine
months then ended in comparison to the respective periods in
fiscal 2001.
Net Interest Expense
Net interest expense decreased for the three and nine
month periods ended June 30, 2002 by approximately $12,000
and $24,000 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 nine month period ended
June 30, 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 nine months ended June 30,
2001 was approximately $155,000.
Net Income
Income before income taxes increased to $186,000 during
the quarter ended June 30, 2002 from a loss of ($31,000)
during the same period in the prior year. The Company
recorded a provision for taxes of approximately $77,000 for
the quarter ended June 30, 2002 as compared to a tax benefit
of $41,000 for quarter ended June 30, 2001. The net profit
amounted to approximately $109,000 or 1.2% of revenues
during the third quarter of Fiscal 2002 versus $10,000 or
0.1% of revenues in the third quarter of Fiscal 2001.
For the nine months ended June 30, 2002, income before
income taxes decreased to $250,000 from $742,000 during the
same period in the prior year. The Company recorded a
provision for taxes of approximately $104,000 for the nine
months ended June 30, 2002 as compared to a tax provision of
$322,000 for nine months ended June 30, 2001. The net
profit amounted to approximately $146,000 or 0.6% of
revenues during the first nine months of Fiscal 2002 versus
a net profit of $421,000 or 1.3% of revenues for the same
period in Fiscal 2001.
Liquidity and Capital Resources
Net cash used for operating activities was
approximately $237,000 for the nine months ended June 30,
2002, while cash provided by operations was approximately
$176,000 for the nine months ended June 30, 2001. During
the nine months ended June 30, 2002, cash was primarily used
to finance the increase in accounts receivable, offset by
the net income of the Company. For the nine months ended
June 30, 2001, cash was primarily provided by the net income
of the Company and a decrease in accounts receivable, offset
by a decrease in accounts payable and a short term loan that
was extended to an unrelated freight and warehouse services
company.
At June 30, 2002, the Company had cash and cash
equivalents of $421,000 and net working capital of
$1,507,000, compared with cash and cash equivalents of
$458,000 and net working capital of $1,023,000 respectively,
at June 30, 2001. The increase in working capital at June
30, 2002 over June 30, 2001 is primarily 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 nine
months ended June 30, 2002, capital expenditures amounted to
approximately $84,000. For the nine months ended June 30,
2001, capital expenditures amounted to approximately
$185,000, of which approximately $41,000 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 June 30, 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
June 30, 2002, there was $1,100,000 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
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; the
effect of litigation; future costs of transportation; future
operating expenses; future margins; any seasonality of the
Company's business; future acquisitions and the effects,
benefits, results, terms or other aspects of any
acquisition; 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 acts of
terrorism; 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: August 14, 2002
--------------------------------- ---------------
Sam DiGiralomo, President and CEO
BY: /s/ Craig D. Stratton DATED: August 14, 2002
--------------------------------- ---------------
Craig D. Stratton, CFO, Secretary,
Treasurer and Principal Financial Officer
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Allstates WorldCargo,
Inc. (the "Company") on Form 10-Q for the period ending
June 30, 2002 as filed with the Securities and Exchange
Commission on the date hereof (the "Report"), I, Sam DiGiralomo,
Chief Executive Officer of the Company, certify, pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of
section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and
(2) The information contained in the Report fairly
presents, in all material respects, the financial condition and
result of operations of the Company.
/s/ Sam DiGiralomo
Sam DiGiralomo
Chief Executive Officer
August 14, 2002
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of Allstates WorldCargo,
Inc. (the "Company") on Form 10-Q for the period ending
June 30, 2002 as filed with the Securities and Exchange
Commission on the date hereof (the "Report"), I, Craig D. Stratton,
Chief Financial Officer of the Company, certify, pursuant to
18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of
section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and
(2) The information contained in the Report fairly
presents, in all material respects, the financial condition and
result of operations of the Company.
/s/ Craig D. Stratton
Craig D. Stratton
Chief Financial Officer
August 14, 2002
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