FORM 10-QSB/A
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2001
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
For the transition period from to .
Commission file number 33-16453
MICRONETICS WIRELESS, INC.
(Exact name of small business issuer as specified in its charter)
Delaware 22-2063614
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
26 Hampshire Drive, Hudson NH 03051
(Address of principal executive offices)
(Zip Code)
(603) 883-2900
(Issuer's telephone number, including area code)
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities and Exchange Act of 1934 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
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practical date.
4,088,317 shares of common stock, par value $.01 per share as
of June 30, 2001.
Page 1 of 12. There is no Exhibit Index.
MICRONETICS WIRELESS, INC.
INDEX
Page No.
Part I. Financial Information:
Item 1. Financial Statements.
Consolidated Condensed Balance
Sheets - June 30, 2001 and March 3-4
31, 2001
Consolidated Condensed Statements
of Operations - Three Months Ended
June 30, 2001 and June 30, 2000 5
Consolidated Condensed Statement 6-7
of Cash Flows - Three Months Ended
June 30, 2001 and June 30, 2000
Notes to Consolidated Condensed 8
Financial Statements
Item 2. Management's Discussion and Analysis
or Plan of Operation. 9-10
Part II. Other Information:
Item 6. Exhibits and Reports on Form 8-K. 11
Signature 12
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements.
MICRONETICS WIRELESS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(UNAUDITED)
Assets
June 30, March 31,
2001 2001
CURRENT ASSETS:
Cash $1,652,798 $1,573,081
Receivables
Trade (net of allowance for
doubtful accounts) 1,393,690 1,561,157
Inventories (note 2) 2,730,227 2,555,172
Prepaid expenses and other
current assets 95,637 88,037
Other current assets 46,311 46,311
TOTAL CURRENT ASSETS 5,918,663 5,823,758
FIXED ASSETS
Land 162,000 162,000
Building & improvements 956,246 956,246
Furniture, fixtures, and
equipment 2,607,604 2,542,903
Capitalized leases 140,949 146,253
Gross fixed assets 3,866,799 3,807,402
Accumulated depreciation
and amortization 1,891,091 1,835,597
TOTAL (NET) FIXED ASSETS 1,975,708 1,971,805
OTHER ASSETS
Deposits 960 960
Intangibles (net of
amortization) 104,276 107,294
Goodwill 320,471 320,471
TOTAL OTHER ASSETS 425,707 428,725
TOTAL ASSETS $8,320,078 $8,224,288
MICRONETICS WIRELESS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(UNAUDITED)
Liabilities and Shareholders' Equity
June 30, March 31,
2001 2001
CURRENT LIABILITIES:
Short-term loans and capitalized
leases $ 83,460 $ 76,032
Accounts payable 411,022 482,295
Accrued expenses and taxes, other
than income taxes 359,624 307,903
Income taxes payable 20,677 26,475
TOTAL CURRENT LIABILITIES 874,783 892,705
LONG-TERM DEBT:
Notes payable 662,885 676,426
Capitalized lease obligations 71,192 83,115
TOTAL LONG-TERM DEBT 734,077 759,541
TOTAL LIABILITIES 1,608,860 1,652,246
SHAREHOLDER'S EQUITY:
Preferred stock - -
Common stock 40,883 40,883
Additional paid - in capital 3,628,917 3,627,406
Retained earnings 3,041,418 2,903,753
TOTAL SHAREHOLDERS' EQUITY 6,711,218 6,572,042
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $8,320,078 $8,224,288
MICRONETICS WIRELESS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended June 30,
2001 2000
Operating revenues $1,784,025 $1,498,822
Cost of operations 1,013,700 946,199
Gross profit 770,325 552,623
Selling, general and
administrative expenses 515,299 345,947
Research & development 94,468 62,461
Operating income 160,558 144,215
Other income (expense):
Rental income 12,462 21,400
Interest income 8,880 11,800
Interest (expense) (15,874) (15,336)
Other income (expense) 841 (9,148)
Total 6,309 8,796
Income before provision
for income taxes 166,867 153,011
Provision for income taxes 29,202 22,950
Net income $ 137,665 $ 130,061
Net income per share $ 0.03 $ 0.03
Weighted average number
of shares outstanding 4,216,739 4,184,567
MICRONETICS WIRELESS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months Ended June 30,
2001 2000
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS:
Cash flows from operating
Activities:
Net income $137,665 $130,061
Adjustments to reconcile net
income to net cash provided
by operating activities:
Decrease in deferred tax asset - 10,710
Depreciation and amortization 55,493 51,983
Changes in assets and liabilities:
(Increase) decrease in accounts
receivable, inventories, prepaid
expenses and other current assets (15,188) (239,472)
(Increase) decrease in security
deposits and other assets 3,019 3,016
(Decrease) increase in accounts
payable, accrued liabilities,
notes payable and other current
liabilities (17,922) (38,172)
Net cash provided (utilized)
by operating activities $163,067 $(81,874)
MICRONETICS WIRELESS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (CONT.)
(UNAUDITED)
Three Months Ended June 30,
2001 2000
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS:
Cash Flows from Investment
Activities:
(Additions) to fixed assets $ (59,397) $ (46,894)
Net cash provided (used) by
investment activities $ (59,397) (46,894)
Cash Flows from Financing
Activities:
(Reduction) increase of debt
and capitalized leases (25,464) (34,196)
Proceeds from stock options
exercised 1,511 45,094
Net cash provided (used)
by financing activities $ (23,953) $ 10,899
NET INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS $ 79,717 $ (117,869)
Cash and cash equivalents, at
beginning of year 1,573,081 1,424,988
CASH AND CASH EQUIVALENTS, AT
END OF QUARTER $1,652,798 $1,307,119
MICRONETICS, WIRELESS, INC.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
Note 1. In the opinion of the Company, the accompany-
ing unaudited consolidated condensed financial
statements contain all adjustments (consisting
of only normal recurring adjustments) which in
the opinion of management are necessary in
order to present fairly the financial position
as of June 30, 2001 and 2000, the results of
operations for the three month periods ended
June 30, 2001 and 2000 and cash flows for the
three month periods ended June 30, 2001 and
2000.
While the Company believes that the
disclosures presented are adequate to make the
information not misleading, it is suggested
that these consolidated condensed financial
statements be read in conjunction with the
Company's Annual Report on Form 10-KSB for its
fiscal year ended March 31, 2001.
The results of operations for the three month
period ended June 30, 2001 are not necessarily
indicative of the results of the full year.
Note 2. Inventories are summarized below:
June 30, 2001 March 31, 2001
Raw materials and
work-in-process $2,515,839 $2,287,365
Finished goods 319,388 372,807
2,835,227 2,660,172
375: Less: allowance for obsolescence (105,000) (105,000)
Total $2,730,227 $2,555,172
Item 2. Management's Discussion and Analysis or Plan of
Operation.
Results of Operations
The Company had revenues of $1,784,025 and $1,498,822 for the
three months ended June 30, 2001 and 2000, respectively, an
increase of $285,203 or 19% in the current period. Gross profit as
a percent of net sales increased to 43.2% in the current period
from 36.9% during the corresponding period of the prior fiscal
year. This was due primarily to product mix. Selling, general and
administrative expenses as a percent of net sales for the current
period increased to 28.8% from 23.1% during the corresponding
period a year ago. This was due primarily to increased selling
expenses. Research and development expenses increased to 5.3% of
net sales during the current period as compared to 4.1% of net
sales a year ago. The Company has increased its new product
development activities during the current period.
The Company had net income of $137,665, or $.03 per share, as
compared to net income of $130,061, or $.03 per share, for the
three month periods ended June 30, 2001 and 2000, respectively. The
weighted average shares outstanding for the three months ended June
30, 2001 and 2000, were 4,216,739 and 4,184,567, respectively.
Financial Condition
The Company's working capital at June 30, 2001 was $5,043,880,
an increase of $112,827 from $4,931,053, the working capital at
March 31, 2001. The Company's current ratio was approximately 6.77
to 1.0 at June 30, 2001; it was approximately 6.52 to 1.0 at March
31, 2001.
Net cash of $163,067 was provided by operating activities
during the three months ended June 30, 2001 as compared to $81,874
that was used by operating activities during the year earlier
period. This was primarily due to net income earned during the
period and the collection of receivables. Net cash used by
investing activities during the three months ended June 30, 2001
was $59,397 as compared to $46,894 during the year earlier period.
This was due to the purchase of new equipment during the current
period. Net cash used by financing activities during the three
months ended June 30, 2001 was $23,953 as compared to $10,899
provided by financing activities during the year earlier period.
As a result of these activities, the Company's cash position
increased $79,717 during the current three months as compared to a
reduction of $117,869 in the year ago period.
Safe Harbor Statement
Statements which are not historical facts, including
statements about the Company's confidence and strategies and its
expectations about new and existing products, technologies and
opportunities, market and industry segment growth, demand and
acceptance of new and existing products are forward looking
statements that involve risks and uncertainties. These include,
but are not limited to, product demand and market acceptance risks;
the impact of competitive products and pricing; the results of
financing efforts; the loss of any significant customers of any
business; the effect of the Company's accounting policies; the
effects of economic conditions and trade, legal, social, and
economic risks, such as import, licensing, and trade restrictions;
the results of the Company's business plan and the impact on the
Company of its relationship with its lender. This report should be
read in conjunction with the Company's Annual Report on Form 10-KSB
for its fiscal year ended March 31, 2001.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
3.1 Certificate of Incorporation of the Company, as amended,
incorporated by reference to Exhibit 3.1 to Registration
Statement No. 33-16453 (the "Registration Statement").
3.2 By-Laws of the Company incorporated by reference to
Exhibit 3.2 of the Registration Statement.
(b) Reports on Form 8-K
During the quarter ended June 30, 2001, the registrant did not
file any reports on Form 8-K.
SIGNATURE
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.
MICRONETICS WIRELESS, INC.
(Registrant)
Dated: August 22, 2001 By:/s/Richard S. Kalin
Richard S. Kalin,
President (Principal
Executive Officer)
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