SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES AND EXCHANGE ACT OF 1934
For the quarter ended:
March 31, 2002
Commission File Number
--------
CEDAR MOUNTAIN DISTRIBUTORS, INC.
-------------------------------------------
(Name of small business issuer in its charter)
Nevada 91-2015441
------------------------------- --------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification number)
1236 EAST FRONTIER LANE
OLATHE, KANSAS 66062
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(Address of Principal Executive offices) (Zip Code)
Issuer's telephone number: (913) 782-3068
Securities registered under Section 12(b) of the Act: None
Securities registered under Section 12(g) of the Act: None:
Check whether the issuer (1) has 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 [ ]
There were 3,000,000 shares of common stock $.001 par value outstanding as of
April 30, 2002.
Documents incorporated by reference: None
Transitional Small Business Format (check one); Yes [ ] No [X]
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
The Consolidated Financial Statements of the Company required to be
filed with this 10-QSB Quarterly Report were prepared by management and commence
on the following page, together with related Notes. In the opinion of
management, the Consolidated Financial Statements fairly present the financial
condition of the Company.
CEDAR MOUNTAIN DISTRIBUTORS, INC.
CONSOLIDATED BALANCE SHEETS
ASSETS
March 31, December 31,
2002 2001
(Unaudited)
--------- ---------
Current assets:
Cash ...................................................... $ 5,471 $ 6,986
Accounts receivable ....................................... 11,734 4,829
Merchandise inventory, at lower of cost or market ......... 10,182 11,591
--------- ---------
Total current assets ........................... 27,387 23,406
other Assets:
Prepaid Offering Costs..................................... 23,720 15,000
--------- ---------
$ 51,107 38,406
========= =========
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current liabilities:
Accounts and notes payable:
Accounts payable ..................................... $ 13,319 5,482
Accrued interest payable.............................. 9,816 7,427
Notes payable, shareholder 99,000 90,500
--------- ---------
Total current liabilities ...................... 122,135 103,409
Shareholders' equity deficit:
Preferred stock, $0.001 par value;
5,000,000 shares authorized, -0-
issued and outstanding ................................... -- --
Common stock, $0.001 par value,
50,000,000 shares authorized, 3,000,000
and 3,000,000 issued and outstanding ..................... 3,000 3,000
Additional paid-in capital ................................ 39,110 35,510
Retained deficit .......................................... (113,138) (103,513)
--------- ---------
Total shareholders' equity (deficit)......... (71,028) (65,003)
--------- ---------
$ 51,107 38,406
========= =========
See accompanying notes to consolidated financial statements
CEDAR MOUNTAIN DISTRIBUTORS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
For the Quarter Ended
March 31,
-----------------------------
2002 2001
------------ ------------
Sales .................................. $ 9,659 $ 10,618
Cost of sales .......................... 7,878 6,722
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Gross profit ............... 1,781 3,896
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Operating Expenses ..................... 9,017 15,683
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Loss from operations ....... (7,236) (11,787)
Interest (expense) ..................... (2,389) (664)
------------ ------------
Net loss ................... $ (9,625) $ (12,451)
============ ============
Net loss per basic common share ........ $ (0.00) $ (0.00)
============ ============
Number of shares outstanding for purposes
of computing net loss per
basic and diluted share .............. 3,000,000 3,000,000
============ ============
See accompanying notes to consolidated financial statements
CEDAR MOUNTAIN DISTRIBUTORS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
For the Quarters Ended
March 31,
----------------------
2002 2001
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Cash flows from operating activities:
Net loss ............................................. $ (9,625) $ (12,451)
Adjustments to reconcile net loss to
net cash used in operating activities:
Contribution of Services ........................ 3,600 3,600
--------- ---------
(6,025) (8,851)
Changes in current assets and liabilities:
Accounts receivable, inventory
and other current assets ...................... (5,496) (6,203)
Accounts payable and accrued expenses ........... 10,226 (6,318)
--------- ---------
Net cash flow (used in) operating activities . (1,295) (21,372)
--------- ---------
Cash flows from financing activities:
Offering costs incurred .............................. (8,720) --
Proceeds from Notes Payable - Shareholders............ 8,500 40,000
--------- ---------
Net cash flow provided by (used in)
financing activities (220) 40,000
--------- ---------
Net change in cash ......................................... (1,515) 18,628
Cash at beginning of period ................................ 6,986 2,573
--------- ---------
Cash at end of period ........................ $ 5,471 $ 21,201
========= =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest ........................................ $ -- $ --
========= =========
Income taxes .................................... $ -- $ --
========= =========
See accompanying notes to consolidated financial statements
CEDAR MOUNTAIN DISTRIBUTORS, INC.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2002 AND 2001
1. Interim Reporting - BASIS OF PRESENTATION
Summary of issuer's significant accounting policies are incorporated by
reference to the Company's report and financial statements dated
December 31, 2001 included on Form SB-2 filed May 3, 2002.
The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles and with Form 10-QSB requirements.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments considered necessary for a fair
presentation have been included. Operating results for the three month period
ended March 31, 2002, are not necessarily indicative of the results that may be
expected for the year ended December 31, 2002.
The accompanying financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America, which
contemplates continuation of the Company as a going concern. However, the
Company has sustained substantial operating losses through March 31, 2002, and
has used significant amounts of working capital in its operations. Further, at
March 31, 2002, current liabilities exceed current assets by $94,748, and total
liabilities exceed total assets by $71,028.
In view of these matters, realization of a major portion of the assets in the
accompanying balance sheet is dependent upon continued operations of the
Company, which in turn is dependent upon the Company's ability to meet its debt
obligations and the success of its future operations. Management believes that
actions presently being taken which include, among other things, additional
stockholder loans to the Company and a restructuring designed to improve
long-term profitability and generate steady growth, provide the opportunity for
the Company to continue as a going concern.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Results of Operations
For the quarter ended March 31, 2002, the Company had revenues of
$9,659 and cost of net product sales of $7,878 compared to revenues of $10,618
and cost of $6,722 for the quarter ended March 31, 2001. Operating expenses were
$9,017, resulting in a loss from operations of $7,236, compared to operating
expenses and a loss from operations of $15,683 and $11,787, respectively for the
same quarter of the prior year. A higher level of operations and promotion
activities is expected when additional funding is achieved.
Liquidity and Capital Resources.
On March 31, 2002, the Company had $27,387 in current assets, including
$5,471 in cash, and total current liabilities of $122,135, resulting in a net
working capital deficit of $94,748 compared to a net working capital deficit of
$80,003 at December 31, 2001. Net cash used in operating activities for the
quarter ended March 31, 2002 was $1,295, compared to $21,372 for the quarter
ended March 31, 2001. Net cash used in financing activities for the quarter
ended March 31, 2002 was $220. Proceeds of notes payable to shareholders were
$40,000 during the quarter ended March 31, 2001.
In May of 2002, the Company received approval of a registration for an
offering of its common stock. Two hundred thousand shares are to be offered at a
price of $1.00 per share, resulting in gross proceeds of $200,000 and net
proceeds to the Company from the offering of approximately $150,000. The Company
intends to use the net cash proceeds to expand its operations and believes it
will have sufficient cash resources to execute its planned operations for the
year ending December 31, 2002. The Company does not have any commitments for
significant capital or operating expenditures above their current levels.
The Company's independent accountants have expressed substantial doubt
about the Company's ability to continue as a going concern. Management plans to
continue operating the Company and to pursue various financing activities, such
as additional stockholder loans and equity financing.
Forward Looking Statements
Certain statements contained in this Report on Form 10-QSB, including
statements of the Company's current expectations, intentions, plans and beliefs,
and statements containing the words "believes," "anticipates," "estimates,"
"expects," or "may," are forward-looking statements, as defined in Section 21D
of the Securities Exchange Act of 1934. Such forward-looking statements involve
known and unknown risk, uncertainties and other factors which may cause the
actual results, performance, timing or achievements of the Company to be
materially different from any results, performance, timing or achievements
expressed or implied by such forward-looking statements.
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.
(a) Exhibits. None
(b) Reports on Form 8-K: None
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
CEDAR MOUNTAIN DISTRIBUTORS, INC.
By: /s/ James R. Smith
--------------------------------
James R. Smith
President and Principal
Executive Officer