SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Form 10-QSB/A/2
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended June 30, 1999 Commission file number 000-25209
BESICORP LTD.
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(Exact name of small business issuer as specified in its charter)
New York 14-1809375
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(State or other jurisdiction of (Internal Revenue Service
incorporation or organization) Employer Identification No.)
1151 Flatbush Road, Kingston, New York 12401
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(Address of principal executive office) (Zip Code)
Issuer's Telephone Number, including area code: (914) 336-7700
N/A
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(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 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_____
Common stock outstanding as of August 12, 1999 136,382
Transitional Small Business Disclosure Format Yes______ No __X___
1
PART I - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
BESICORP LTD.
CONSOLIDATED BALANCE SHEET
(unaudited)
June 30,1999 March 31,1999
------------ -------------
ASSETS
Current Assets:
Cash and cash equivalents $2,894,589 $ 1,824,139
Trade accounts and notes receivable (less allowance
for doubtful accounts of $32,000 as of June 30, 1999
and March 31, 1999) 963,075 988,589
Due from affiliates 62,868 374,250
Notes receivable: (includes interest of $8,122
at
June 30, 1999 and $4,057 at March 31, 111,448 107,951
1999)
Inventories 1,683,117 1,165,761
Other current 438,766 465,566
assets --------- ---------
Total Current Assets 6,153,863 4,926,256
--------- ---------
Property, Plant and Equipment:
Land and improvements 229,660 229,660
Buildings and improvements 1,914,029 1,914,029
Machinery and equipment 573,469 726,958
Furniture and fixtures 237,423 237,423
Construction in progress 526 0
--------- ---------
2,955,107 3,108,070
Less: accumulated depreciation and amortization (1,401,443) (1,520,385)
--------- ---------
Net Property, Plant and Equipment 1,553,664 1,587,685
--------- ---------
Other Assets:
Patents and trademarks, less accumulated
amortization of $2,638 at
June 30, 1999 and $2,350, at March 31, 18,272 12,530
1999
Investment in partnerships 1,999,905 4,009,810
Deferred costs 186,757 0
Other assets 87,225 76,620
--------- --------
Total Other Assets 2,292,159 4,098,960
--------- ----------
TOTAL ASSETS $ 9,999,686 $ 10,612,901
========= ==========
See accompanying notes to consolidated financial statements.
2
BESICORP LTD.
CONSOLIDATED BALANCE SHEET
(unaudited)
June 30,1999 March 31,1999
------------ -------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $ 1,420,065 $ 763,531
Current portion of long-term debt 42,000 20,000
Current portion of accrued reserve and warranty expense 87,009 111,215
Taxes other than income taxes 98,516 103,207
Income taxes payable 5,437 5,300
--------- ---------
Total Current Liabilities 1,653,027 1,003,253
Long-Term Accrued Reserve and Warranty Expense 174,462 174,462
Long-Term Debt 51,070 115,308
--------- ---------
Total 1,878,559 1,293,023
Liabilities --------- ---------
Shareholders' Equity:
Common stock, $.01 par value: authorized
5,000,000 shares; issued and outstanding 136,382
at June 30, 1999 and 121,382 at March 31, 1999 1,364 1,214
Additional paid in capital 10,135,677 9,490,827
Unamortized deferred compensation (623,500) 0
Retained earnings (deficit) (1,392,414) (172,163)
--------- ---------
Total Shareholders' Equity 8,121,127 9,319,878
--------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 9,999,686 $ 10,612,901
========= ==========
See accompanying notes to consolidated financial statements.
3
BESICORP LTD.
CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited)
Three months ended June 30,
1999 1998
----- -----
Revenues:
Product sales $2,125,072 $ 987,793
Other revenues 60,929 124,701
Interest and other investment 23,400 6,773
income
Other income 0 24,867
--------- ---------
Total Revenues 2,209,401 1,144,134
--------- ---------
Costs and Expenses:
Cost of product sales 1,850,827 947,831
Selling, general
and
administrative expenses 1,567,730 1,342,274
Interest expense 287 94,383
Other expenses 50 433
--------- ---------
Total Costs and Expenses 3,418,894 2,384,921
--------- ---------
Loss before Income Taxes (1,209,493) (1,240,787)
Provision (Credit) for Income Taxes 10,758 (422,000)
--------- ----------
Net Loss $ (1,220,251) $ (818,787)
========= ===========
Basic Loss per Share $ (9.44) $ (6.75)
========= ========
Basic Weighted Average Number of Shares Outstanding (in Thousands) 129,294 121,382
========= =======
See accompanying notes to consolidated financial statements.
4
BESICORP LTD.
CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)
Three months ended June 30,
1999 1998
------ -----
Operating Activities:
Net loss $ (1,220,251) $(818,787)
Adjustments to reconcile net loss to net
cash used by operating
activities:
Amortization of discounts on (549) (549)
notes
Stock compensation 21,500 0
Depreciation and amortization 45,624 50,464
Changes in assets and
liabilities:
Accounts and notes receivable 333,948 (308,739)
Inventories (517,356) (182,878)
Accounts payable and accrued expenses 656,534 (87,465)
Taxes payable/refundable (4,554) (4,899)
Other assets and (200,798) 41,377
-------- --------
liabilities, net
Net cash used by operating (885,902) (1,311,476)
activities -------- ---------
Financing Activities:
Repayment of borrowings (42,238) (24,128)
Net transactions with Besicorp Group Inc. 0 1,452,317
-------- ---------
Net cash provided (used) by financing activities (42,238) 1,428,189
-------- ---------
Investing Activities:
Distribution from partnerships 2,009,905 0
Acquisition of property, plant
and equipment (11,315) 0
---------- ---------
Net cash provided by investing activities 1,998,590 0
---------- ---------
Increase in Cash and Cash Equivalents 1,070,450 116,713
Cash and Cash Equivalents - Beginning 1,824,139 104,428
--------- --------
Cash and Cash Equivalents - Ending $ 2,894,589 $ 221,141
========= ========
Supplemental Cash Flow Information:
Interest paid $ 287 $ 95,239
Income taxes paid 5,930 0
See accompanying notes to consolidated financial statements.
5
BESICORP LTD.
UNAUDITED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
A. The accompanying unaudited financial statements have been prepared in
accordance with the generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB. Accordingly,
they do not include all the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the opinion
of management, the accompanying consolidated financial statements contain all
adjustments (consisting only of normal recurring adjustments) necessary to
present fairly the financial position of Besicorp Ltd. (together with its
subsidiaries, the "Company") as of June 30, 1999, and March 31, 1999; the
results of operations for the three-month periods ended June 30, 1999 and 1998;
and the statement of cash flows for the corresponding three-month periods.
The balance sheet at March 31, 1999 has been derived from the audited financial
statements at that date, but does not include all the information and footnotes
required by generally accepted accounting principles for complete financial
statements. For further information, refer to the audited consolidated financial
statements and footnotes thereto included in the Form 10-KSB filed by the
Company for the year ended March 31, 1999.
Besicorp Group Inc., the former parent of Besicorp Ltd., was a party to an
Agreement and Plan of Merger dated November 23, 1998, as amended, (the "Plan of
Merger") among Besicorp Group Inc., BGI Acquisition LLC ("Acquisition") and BGI
Acquisition Corp. ("Merger Sub"), a wholly owned subsidiary of Acquisition.
Pursuant to the Plan of Merger, Merger Sub was merged into Besicorp Group Inc.,
which then became a wholly owned subsidiary of Acquisition (the "Merger").
Because Acquisition did not want to acquire certain assets or assume certain
liabilities of Besicorp Group Inc., it was a condition precedent to the Merger
that Besicorp Group Inc., prior to the Merger, spin-off its photovoltaic and
independent power development businesses (the "Distributed Businesses") to its
shareholders. Therefore, Besicorp Group Inc. formed Besicorp Ltd. to assume the
operations of the Distributed Businesses by having Besicorp Group Inc. assign to
Besicorp Ltd. all of its assets relating to the Distributed Businesses and
substantially all of Besicorp Group Inc.'s other assets (other than Besicorp
Group Inc.'s cash, securities, the subsidiaries which held Besicorp Group Inc.'s
interests in partnerships which owned or leased five cogeneration natural gas
power plants (the "Retained Subsidiaries") and certain other assets (including
in particular, other claims of and awards made to Besicorp Group Inc. in the
aggregate stated amount of approximately $1 million)), and by having Besicorp
Ltd. (the "Company") assume substantially all of Besicorp Group Inc.'s
liabilities other than the following liabilities (collectively, the "Permitted
Liabilities"): (i) the liabilities of Besicorp Group Inc. and any Retained
Subsidiary (actual or accrued) for unpaid federal income taxes for Besicorp
Group Inc.'s 1999 fiscal year based on the consolidated net income of Besicorp
Group Inc. through the effective date of the Merger (i.e. March 22, 1999), (ii)
the liabilities of Besicorp Group Inc. or its subsidiaries for New York State
income taxes for the 1999 fiscal year, and (iii) certain intercompany
liabilities. The Plan of Merger contemplated that prior to the consummation of
the Merger Besicorp Group Inc. would effect this contribution of assets to the
Company (and the assumption of these liabilities by the Company) and distribute
all of Besicorp Ltd.'s stock to Oldco's shareholders. Therefore, following the
contribution, which took place shortly prior to the Merger which was consummated
on March 22, 1999, Besicorp Group Inc. distributed 100% of Besicorp Ltd.'s
common stock (the "Distribution"), and Besicorp Ltd. became a separate, publicly
held company.
Besicorp Ltd. and subsidiaries consolidated financial statements at and prior
to the Distribution reflect the operations, financial position and cash flows
of Besicorp Ltd. and subsidiaries as if they were a separate entity. Such
financial statements were derived from the consolidated financial statements of
Besicorp Group Inc. using historical results of operations and historical basis
in the assets and liabilities of the business operated by Besicorp Ltd.
6
The financial information for the year ended March 31, 1999 may not necessarily
reflect the consolidated results of operations, financial position, cash flows
and changes in shareholders' equity of Besicorp Ltd. had Besicorp Ltd. been a
separate entity during that period.
Amounts shown as net transactions with Besicorp Group Inc. represent the net
effect of cash generated or used by the Distributed Businesses and transferred
to or from Besicorp Group Inc.
B. Business
--------
Besicorp Ltd. specializes in the development, assembly, manufacture, marketing
and resale of photovoltaic products and systems ("Product Segment") and the
development of power plant projects ("Project Segment").
Basic/Diluted Earnings per Common Share
- ---------------------------------------
Effective December 15, 1997, the Company adopted the provisions of Statement of
Financial Accounting Standards ("SFAS") No. 128, Earnings per Share. The
Statement required companies with a complex capital structure to report both
Basic Earnings per Share and Diluted Earnings per Share. Diluted Earnings per
Share considers the effect of potential common shares such as stock options and
warrants. Loss per common share for the three months ended June 30, 1999 is
based on the weighted average number of shares of 129,294 outstanding during
that period. Loss per common share for the three months ended June 30, 1998 is
computed based on 121,823 shares being issued as adjusted after the Distribution
and Spin-Off. Since there were no potential Common Shares as of June 30, 1999
and March 31, 1999, Basic and Diluted Earnings per Share are the same for both
fiscal years.
D. The results of operations for the three-month period ended June 30, 1999 is
not necessarily indicative of the results to be expected for any other interim
period or for the full year.
E. Inventories
-----------
Inventories are carried at the lower of cost (first-in, first-out method), or
market. Inventories at June 30, 1999 and March 31, 1999, consist of:
June 30, 1999 March 31, 1999
------------- --------------
Assembly parts $ 380,820 $ 263,761
Finished goods 1,302,297 902,000
--------- ---------
$1,683,117 $1,165,761
========= =========
F. Deferred Costs
--------------
Deferred costs and reimbursable costs at June 30, 1999 and March 31, 1999 were
as follows:
Internal Costs Third
Payroll Expenses Party Costs Total
------- -------- ----------- --------
Balance March 31, 1999 $0 $0 $0 $0
Additions 72,618 2,970 111,169 186,757
Expensed 0 0 0 0
Reimbursements 0 0 0 0
------ ----- ------- -------
Balance June 30, 1999 $72,618 $2,970 $111,169 $186,757
====== ====== ======= =======
In accordance with its existing policy, the Company is deferring all costs, as
presented above, incurred with respect to the development of a recycled
newsprint manufacturing plant and adjacent 475 megawatt natural gas-fired
cogeneration power plant in Ulster County, New York (the "Kingston Project").
7
G. Investments in Partnerships
---------------------------
Except for one partnership, which management anticipates will be liquidated
around October 1, 1999, all partnerships, which owned or leased five
cogeneration natural gas power plants, were liquidated during the three months
ended June 30, 1999, and the applicable liquidating distributions of
approximately $2,000,000 were received by the Company on June 1, 1999. The
investment in partnerships of $1,999,905 at June 30, 1999 primarily represents
(a) approximately a maximum of $550,000 which management expects will be
received by Besicorp Ltd. upon liquidation of the one unliquidated partnership
and which may be reduced by certain expenses incurred by the partnership and (b)
approximately $1.44 million (the "Liquidated Partnership Funds") held in cash
escrow accounts which were established in connection with three liquidated
partnerships. The Liquidated Partnership Funds, if any, are to be released, if
any, to Besicorp Ltd. between June 2000 and May 2002 subject to the satisfaction
of certain conditions, as to which no assurance can be given.
H. Revenue Recognition
-------------------
Revenues on sales of products are recognized at the time of shipment of goods.
Development and management fee revenue is recognized when deemed payable under
the applicable agreement.
I. Segments of Business
--------------------
The Company specializes in the development, assembly, manufacture, marketing and
resale of photovoltaic products and systems ("Product Segment") and the
development of power plant projects ("Project Segment"). Segments are reported
based on the subsidiary involved with the activity of that segment, with no
intersegment revenues and expenses. A summary of industry segment information
for the three months ended June 30, 1999 and 1998 is as follows:
Project Product
June 30, 1999 Segment Segment Eliminations (1) Total
- ------------- ------- ------- ------------ -----
Net revenues $ 50,487 $ 2,158,914 $ 2,209,401
Loss before taxes 860,677 348,816 1,209,493
Income tax provision (credit) 9,217 1,741 10,758
Net income (loss) (869,694) (350,557) (1,220,251)
Identifiable assets 18,901,734 3,412,340 $(12,314,388) 9,999,686
Investment in partnerships 1,999,905 - 1,999,905
Capital expenditures 0 11,315 11,315
Depreciation and amortization 21,809 23,815 45,624
June 30, 1998
Net revenues $ 43,246 $ 1,100,888 $1,144,134
Loss before taxes 772,947 467,840 1,240,787
Income tax provision (credit) (423,867) 1,867 (422,000)
Net income (loss) (349,079) (469,708) (818,787)
Identifiable assets 16,662,928 2,613,350 $(13,509,386) 5,766,892
Investment in partnerships - - -
Capital expenditures 0 0 0
Depreciation and amortization 22,699 27,765 50,464
(1) Eliminations are comprised of inter-company account receivables recorded on
certain subsidiaries, which are eliminated in consolidation.
K. Legal Proceedings
See Part II, Item 1 which is incorporated by reference.
8
SIGNATURES
- ----------
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.
Besicorp Ltd., Registrant
Date: April 17, 2000 /s/ Michael F. Zinn
---------------- -------------------
Michael F. Zinn
President
(principal executive officer)
Date: April 17, 2000 /s/ James E. Curtin
---------------- -------------------
James E. Curtin
Vice President and Controller
(principal accounting officer)
9