SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Form 10-QSB/A
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended September 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 September 30, 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)
September 30, March 31,
1999 1999
____________ _________
ASSETS
Current Assets:
Cash and cash equivalents $ 800,399 $ 1,824,139
Trade accounts and notes receivable (less allowance
for doubtful accounts of $28,906 as of September 30, 1999
and $32,000 at March 31, 1999) 1,390,706 988,589
Due from affiliates 66,470 374,250
Notes receivable: (includes interest of $5,770 at
September 30, 1999 and $4,057 at March 31, 1999) 87,320 107,951
Inventories 1,818,608 1,165,761
Other current assets 439,579 465,566
---------- ---------
Total Current Assets 4,603,082 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 603,654 726,958
Furniture and fixtures 237,424 237,423
Construction in progress 23,369 0
---------- ---------
3,008,136 3,108,070
Less: accumulated depreciation and amortization (1,438,589) (1,520,385)
----------- ----------
Net Property, Plant and Equipment 1,569,547 1,587,685
----------- ----------
Other Assets:
Patents and trademarks, less accumulated
amortization of $2,940 at
September 30, 1999 and $2,350, at March 31, 1999 18,120 12,530
Investment in partnerships 1,692,414 4,009,810
Deferred costs 382,719 0
Other assets 74,554 76,620
---------- ---------
Total Other Assets 2,167,807 4,098,960
---------- ----------
TOTAL ASSETS $ 8,340,436 $ 10,612,901
========== ==========
See accompanying notes to consolidated financial statements.
2
BESICORP LTD.
CONSOLIDATED BALANCE SHEET
(unaudited)
September 30, March 31,
1999 1999
------------ --------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $ 1,002,200 $ 763,531
Current portion of long-term debt 42,000 20,000
Current portion of accrued reserve and warranty expense 72,946 111,215
Taxes other than income taxes 105,885 103,207
Income taxes payable 8,149 5,300
---------- ---------
Total Current Liabilities 1,231,180 1,003,253
Long-Term Accrued Reserve and Warranty Expense 190,606 174,462
Long-Term Debt 51,070 115,308
---------- ---------
Total Liabilities 1,472,856 1,293,023
---------- ---------
Shareholders' Equity:
Common stock, $.01 par value: authorized
5,000,000 shares; issued 136,382
at September 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 (587,308) 0
Retained earnings (deficit) (2,677,853) (172,163)
---------- ----------
6,871,880 9,319,878
Less: treasury stock at cost (100 shares and 0 shares,
respectively) (4,300) 0
---------- ----------
Total Shareholders' Equity 6,867,580 9,319,878
---------- ----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 8,340,436 $10,612,901
========== ==========
See accompanying notes to consolidated financial statements.
3
BESICORP LTD.
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
Three months ended September 30,
1999 1998
Revenues: ---------------------------------
Product sales $ 2,162,837 $ 1,097,897
Other revenues 145,134 129,386
Interest and other investment income 39,822 6,431
----------- ---------
Total Revenues 2,347,793 1,233,714
Costs and Expenses:
Cost of product sales 1,846,388 1,034,036
Selling, general and administrative expenses 1,708,453 3,120,139
Loss from partnerships 75,187 0
Interest expense 0 9,924
Other expense 28 8,374
--------- ---------
Total Costs and Expenses 3,630,056 4,172,473
--------- ---------
Loss Before Income Taxes (1,282,263) (2,938,759)
Provision (Credit) for Income Taxes 3,176 (993,300)
--------- ----------
Net Loss $ (1,285,439) $ (1,945,459)
========= =========
Basic Loss per Share $ (9.43) $ (16.03)
Basic Weighted Average Number of Shares ========== =========
Outstanding 136,370 121,382
========== =========
See accompanying notes to consolidated financial statements.
BESICORP LTD.
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
Six months ended September 30,
1999 1998
------------------------------
Revenues:
Product sales $ 4,287,909 $ 2,085,690
Other revenues 206,063 278,954
Interest and other investment income 63,222 13,204
--------- ---------
Total Revenues 4,557,194 2,377,848
--------- ---------
Costs and Expenses:
Cost of product sales 3,697,215 1,981,867
Selling, general and administrative expenses 3,276,183 4,462,413
Loss from partnerships 75,187 0
Interest expense 287 104,307
Other expense 78 8,807
---------- ---------
Total Costs and Expenses 7,048,950 6,557,394
---------- ---------
Loss Before Income Taxes (2,491,756) (4,179,546)
Provision (Credit) for Income Taxes 13,934 (1,415,300)
---------- ---------
Net Loss $ (2,505,690) $ (2,764,246)
========= =========
Basic Loss per Share $ (18.86) $ (22.77)
Basic Weighted Average Number of Shares ========== =========
Outstanding 132,851 121,382
========= =========
See accompanying notes to consolidated financial statements.
4
BESICORP LTD.
CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited)
Six months ended September 30,
1999 1998
_____________________________
Operating Activities:
Net loss $ (2,505,690) $(2,764,246)
Adjustments to reconcile net loss to net
cash used by operating activities:
Amortization of discounts on notes (833) (1,098)
Loss on investment in partnerships 75,187 0
Stock compensation 53,392 0
Provision for uncollectibles (3,094) 45,929
Depreciation and amortization 73,274 81,091
Changes in assets and liabilities:
Accounts and notes receivable 156,331 (270,527)
Inventories (652,847) (297,645)
Accounts payable and accrued expenses 238,669 (140,869)
Taxes payable/refundable 5,527 12,519
Other assets and liabilities, net (401,451) 1,546,647
--------- ---------
Net cash used by operating activities (2,961,535) (1,788,199)
--------- ---------
Financing Activities:
Repayment of borrowings (42,238) (3,049,076)
Net transactions with Besicorp Group Inc. 0 4,862,765
--------- ---------
Net cash provided (used) by financing activities (42,238) 1,813,689
--------- ---------
Investing Activities:
Distribution from partnerships 2,034,579 0
Acquisition of property, plant
and equipment (54,546) (70,637)
--------- ---------
Net cash provided (used) by investing activities 1,980,033 (70,637)
--------- ---------
Decrease in Cash and Cash Equivalents (1,023,740) (45,147)
Cash and Cash Equivalents - Beginning 1,824,139 104,428
--------- ---------
Cash and Cash Equivalents - Ending $ 800,399 $ 59,281
========= =========
Supplemental Cash Flow Information:
Interest paid $ 287 $ 161,955
Income taxes paid 6,456 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 September 30, 1999, and March 31, 1999; the
results of operations for the three- and six-month periods ended September 30,
1999 and 1998; and the statement of cash flows for the corresponding six-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, as amended, filed
by the Company for the year ended March 31, 1999.
Besicorp Group Inc. (Oldco), 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.
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.
6
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").
C. 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- and six-month periods ended
September 30, 1999 is based on the weighted average number of shares of 136,370
and 132,851 outstanding during those respective periods. Loss per common share
for the three- and six-month periods ended September 30, 1998 is computed based
on 121,382 shares being issued as adjusted after the Distribution and Spin-Off.
Since there were no potential Common Shares as of September 30, 1999 and
September 30, 1998, Basic and Diluted Earnings per Share are the same for both
fiscal years.
D. The results of operations for the three- and six-month periods ended
September 30, 1999 are 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 September 30, 1999 and March 31, 1999, consist of:
September 30, 1999 March 31, 1999
__________________ ______________
Assembly parts $ 411,472 $ 263,761
Finished goods 1,407,136 902,000
--------- ---------
$1,818,608 $1,165,761
========= =========
F. Deferred Costs
Deferred costs and reimbursable costs at September 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 160,907 13,041 208,771 382,719
Expensed 0 0 0 0
Reimbursements 0 0 0 0
-------- ------- ------- -------
Balance September 30, 1999 $160,907 $13,041 $208,771 $382,719
======== ======= ======= =======
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 December 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 $1,692,414 at September 30, 1999 primarily
represents (a) approximately $250,000 which management expects will be received
by Besicorp Ltd. upon liquidation of the one unliquidated partnership and which
may be increased or reduced depending upon the level of expenses incurred by the
partnership and (b) approximately $1.46 million (the "Liquidated Partnership
Funds") held in cash escrow accounts which were established in connection with
three liquidated partnerships. The Liquidated Partnership Funds 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 subsidiaries involved with the activity of the segment, with no
intersegment revenues and expenses. A summary of industry segment information
for the three and six months ended September 30, 1999 and 1998 is as follows:
For the Six Months Ended Project Product
September 30, 1999 Segment Segment Eliminations (1) Total
- ------------------ ------- ------- ------------ -----
Net revenues $ 107,213 $4,449,981 $4,557,194
Loss before taxes (1,900,436) (591,320) 0 (2,491,756)
Income tax provision (credit) 12,193 1,741 13,934
Net income (loss) (1,912,629) (593,061) (2,505,690)
Identifiable assets 18,970,736 2,196,060 $(12,826,360) 8,340,436
Investment in partnerships 1,692,414 0 0 1,692,414
Capital expenditures 17,729 36,817 54,546
Depreciation and amortization 57,916 15,358 73,274
For the Six Months Ended Project Product Eliminations (1) Total
September 30, 1998 Segment Segment ------------ -----
- ------------------ ------- -------
Net revenues $ 87,935 $2,289,913 0 $2,377,848
Loss before taxes (3,275,002) (904,544) (4,179,546)
Income tax provision (1,417,067) 1,767 (1,415,300)
Net income (loss) (1,857,835) (906,411) (2,764,246)
Identifiable assets 17,130,957 2,213,466 $(15,193,811) 4,150,612
Investment in partnerships 0 0 0 0
Capital expenditures 35,508 35,129 70,637
Depreciation and amortization 64,064 16,977 81,091
8
For the Three Months Ended Project Product
September 30, 1999 Segment Segment Eliminations (1) Total
- ------------------ ------- ------- ------------ -----
Net revenues $56,726 $2,291,067 $2,347,793
Loss before taxes (977,968) (304,295) (1,282,263)
Income tax provision 2,795 381 3,176
Net income (loss) (1,042,935) (242,504) (1,285,439)
Identifiable assets 18,970,736 2,196,060 $(12,826,360) 8,340,436
Investment in partnerships 1,692,414 0 1,692,414
Capital expenditures 17,729 25,502 43,231
Depreciation and amortization 21,855 5,795 27,650
For the Three Months Ended Project Product Eliminations (1) Total
September 30, 1998 Segment Segment ------------ -----
- ------------------ ------- -------
Net revenues $44,689 $1,189,025 $1,233,714
Loss before taxes (2,302,748) (636,011) (2,938,759)
Income tax provision (994,500) 1,200 (993,300)
Net income (loss) 1,508,756 (436,703) (1,945,459)
Identifiable assets 17,130,957 2,213,466 $(15,193,811) 4,150,612
Investment in partnerships 0 0 0 0
Capital expenditures 35,508 35,508 70,637
Depreciation and amortization 24,196 6,431 30,627
(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.
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 13, 1999 /s/ Michael F. Zinn
----------------- -------------------
Michael F. Zinn
President
(principal executive officer)
Date: April 13, 1999 /s/ James E. Curtin
----------------- -------------------
James E. Curtin
Vice President and Controller
(principal accounting officer)
9