UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
450 Fifth Street
Washington, D.C. 20549
Form 10-QSB
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QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended June 30, 2002
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Commission File No. 0-3858
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INTERNATIONAL LEISURE HOSTS, LTD.
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(Exact name of Registrant as specified in its charter)
Wyoming 86-0224163
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(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
3207 S. Hardy Drive
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Tempe, AZ 85282
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(Address of principal executive (Zip Code)
office)
Issuer's telephone number, including area code (480) 829-7600
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Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act during the 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
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State the number of shares outstanding of each of the issuer's classes of common
stock as of the close of the latest practicable date. There were 694,407 shares
of $.01 par value common stock outstanding as of June 30, 2002.
Page 1 of 16
PART I - FINANCIAL INFORMATION
ITEM 1 - Summarized Financial Information
INTERNATIONAL LEISURE HOSTS, LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
June March
30, 2002 31, 2002
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(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 383,441 $ 49,664
Accounts receivable 191 26,402
Income tax refund receivable 48,000 1,000
Merchandise inventories 229,376 109,563
Prepaid expenses and other 38,935 26,751
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Total current assets 699,943 213,380
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PROPERTY AND EQUIPMENT:
Buildings and improvements 7,030,870 7,030,870
Equipment 1,889,223 1,983,380
Leasehold improvements 325,600 325,600
Construction in progress 370,683 321,553
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Total property and equipment 9,616,376 9,661,403
Less accumulated depreciation and amortization 3,312,858 3,260,199
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Property and equipment - net 6,303,518 6,401,204
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TOTAL $ 7,003,461 $ 6,614,584
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LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable under lines of credit from related party $ 975,000 $ 935,000
Note payable under line of credit 175,000 175,000
Accounts payable:
Trade 271,386 71,748
Related party 5,000
Accrued liabilities 94,222 42,982
Advance deposits 315,856 118,743
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Total current liabilities 1,831,464 1,348,473
DEFERRED INCOME TAXES 177,421 177,421
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Total liabilities 2,008,885 1,525,894
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COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, $5 par value - authorized 100,000 shares: none issued
Common stock, $.01 par value - authorized 2,000,000 shares: issued 718,373 shares 7,184 7,184
Additional paid-in capital 656,426 656,426
Retained earnings 4,409,928 4,504,042
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5,073,538 5,167,652
Less common stock in treasury - at cost, 23,966 shares (78,962) (78,962)
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Shareholders' equity - net 4,994,576 5,088,690
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TOTAL $ 7,003,461 $ 6,614,584
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See notes to condensed consolidated financial statements
Page 2 of 16
INTERNATIONAL LEISURE HOSTS, LTD.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the three months ended
June 30,
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2002 2001
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REVENUES:
Sales of merchandise $ 335,539 $ 340,357
Room, cabin and trailer space rentals 354,407 327,427
Other rentals and income 39,396 89,757
Interest 165 490
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Total revenues 729,507 758,031
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COSTS AND EXPENSES:
Cost of merchandise 205,840 221,890
Operating 426,337 437,565
General and administrative 42,753 35,206
General and administrative - related party 73,074 33,750
Net loss on asset disposals 29,323
Depreciation and amortization 82,044 89,059
Interest 2,065 4,525
Interest - related party 9,185 8,571
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Total costs and expenses 870,621 830,566
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Loss before income taxes (141,114) (72,535)
Benefit for income taxes (47,000) (25,000)
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NET LOSS ($ 94,114) ($ 47,535)
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NET LOSS PER COMMON SHARE - BASIC $ (0.14) $ (0.07)
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See notes to condensed consolidated financial statements
Page 3 of 16
INTERNATIONAL LEISURE HOSTS, LTD.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Three months ended June 30,
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2001 2000
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OPERATING ACTIVITIES:
Net loss ($ 94,114) ($ 47,535)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization 82,044 89,059
Net loss on asset disposals 29,323
Changes in assets and liabilities:
Accounts receivable 26,211 (867)
Income tax refund receivable (47,000) (25,000)
Merchandise inventories (119,813) (93,470)
Prepaid expenses and other (12,184) (23,455)
Accounts payable - trade 199,638 (22,280)
Accounts payable - related party (5,000)
Income taxes payable (24,454)
Accrued liabilities 51,240 67,689
Advance deposits 197,113 169,123
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Net cash provided by operating activities 307,458 88,810
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INVESTING ACTIVITIES:
Purchases of property and equipment (59,498) (91,850)
Proceeds from sale of property and equipment 45,817
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Net cash used in investing activities (13,681) (91,850)
FINANCING ACTIVITIES:
Loan proceeds from affiliate 40,000 50,000
Loan proceeds from bank 77,580
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Net cash provided by financing activities 40,000 127,580
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NET INCREASE IN CASH AND CASH EQUIVALENTS 333,777 124,540
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 49,664 174,991
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CASH AND CASH EQUIVALENTS, END OF PERIOD $ 383,441 $ 299,531
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SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION - Cash paid for interest $ 16,061 $ 25,985
========= =========
See notes to condensed consolidated financial statements
Page 4 of 16
INTERNATIONAL LEISURE HOSTS, LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For the Three Month Periods Ended June 30, 2002 and 2001
The accompanying condensed consolidated financial statements have been prepared
in accordance with accounting principles generally accepted in the United States
of America for interim financial information and with the instructions to Form
10-QSB. Accordingly, they do not include all of the information and notes
required by accounting principles generally accepted in the United States of
America for complete financial statements. In the opinion of management, all
adjustments and reclassifications considered necessary for a fair and comparable
presentation have been made and are of a normal recurring nature. Operating
results for the three months ended June 30, 2002 are not necessarily indicative
of the results that may be expected for the year ending March 31, 2003. The
enclosed financial statements should be read in conjunction with the
consolidated financial statements and notes thereto included in the Company's
Annual Report on Form 10-KSB for the year ended March 31, 2002.
1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
International Leisure Hosts, Ltd. (the "Company") operates in one business
segment, the ownership and operation of Flagg Ranch Resort ("Flagg Ranch"), a
full-service resort motel and trailer park located in the John D. Rockefeller
Jr. Memorial Parkway, approximately four miles north of Grand Teton National
Park and two miles south of the southern entrance to Yellowstone National Park.
Significant Accounting Policies - The Company prepares its financial statements
in accordance with accounting principles generally accepted in the United States
of America. A summary of significant accounting policies is as follows:
a. Basis of Consolidation - The consolidated financial statements include
the accounts of the Company and its subsidiary after elimination of all
significant intercompany transactions and accounts.
b. Revenue Recognition - The Company recognizes lodging revenue at the
completion of a room night and for other ancillary revenue as the
services are provided.
c. Cash and cash equivalents - Cash and cash equivalents represent cash in
banks, money market funds, and certificates of deposit with initial
maturities of three months or less.
d. Merchandise inventories are stated at the lower of aggregate cost
(first-in, first-out basis) or market.
e. Property and equipment are stated at cost. Depreciation is computed by
straight-line and accelerated methods over the estimated useful lives,
which range from 5 to 40 years. Leasehold improvements are amortized
using the straight-line method over the lesser of the estimated useful
life of the related asset or the term of the lease. The Company reviews
the carrying values of its long-lived assets and identifiable
intangibles for possible impairment whenever events or changes in
circumstances indicate that the carrying amount of assets to be held
and used may not be recoverable. For assets to be disposed of, the
Company reports long-lived assets and certain identifiable intangibles
at the lower of carrying amount or fair value less cost to sell.
Page 5 of 16
f. Income taxes - Deferred income taxes have been provided for the
temporary differences between financial statement and income tax
reporting on certain transactions.
g. Use of Estimates - The preparation of financial statements in
conformity with accounting principles generally accepted in the United
States of America requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
h. Net Income per Common Share - Basic net income per common share is
computed by dividing net income by the weighted average number of
common shares outstanding. The weighted average number of common shares
outstanding was 694,407 for both 2002 and 2001. Diluted net income per
share reflects potential dilution that could occur from common shares
issuable through stock options, warrants or other convertible
securities; however, the Company has no dilutive securities.
i. Estimated Fair Value of Financial Instruments - The Company has
estimated the fair value of its financial instruments using available
market data. However, considerable judgment is required in interpreting
market data to develop estimates of fair value. The use of different
market assumptions or methodologies may have a material effect on the
estimates of fair values. The carrying values of cash, receivables,
lines of credit, accounts payable, accrued expenses, and debt
approximate fair values due to the short-term maturities or market
rates of interest.
j. New Accounting Pronouncement - In August 2001 the FASB issued SFAS No.
144, Accounting for the Impairment or Disposal of Long-Lived Assets,
which supercedes SFAS No. 121, Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed of and
amends APB Opinion No. 30, Reporting the Results of Operations -
Reporting the Effects of Disposal of a Segment of a Business, and
Extraordinary, Unusual and Infrequently Occurring Events and
Transactions. The new rules apply to the classification and impairment
analysis conducted on long-lived assets other than certain intangible
assets, resolve existing conflicting treatment on the impairment of
long-lived assets and provide implementation guidance regarding
impairment calculations. SFAS No. 144 also expands the scope to include
all distinguishable components of an entity that will be eliminated
from ongoing operations in a disposal transaction. The Company
implemented this statement on April 1, 2002 and determined that it did
not have a material effect on its financial statements.
Page 6 of 16
2. COMMITMENTS AND CONTINGENCIES
The Company receives its operating authorization from the National Park Service
("NPS"). The NPS Contract (the "Contract") which became effective on January 1,
1990, will expire on December 31, 2009. Under the terms of the Contract, prior
to December 31, 2002, the Company is required to move its existing 54-unit
riverside motel from its current location to the high ground above the Snake
River, to provide for new employee housing and make certain other improvements.
The Company has chosen to meet these requirements by moving the riverside motel
and converting it into employee housing, plus building additional employee
support facilities, which began in summer 1998, with expected completion by
December 31, 2002. The remaining cost of this relocation is estimated to be
approximately $100,000.
The extensive capital investments which were required by the Company's current
Contract, were made based on the Park providing road access in the winter and
full winter services (i.e. snowmobile rentals) for the duration of the Contract.
These services are necessary to allow the Company to recover its substantial
investment and provide a reasonable opportunity to realize a profit consistent
with the Contract and applicable law. The Company relied on the Park's
representations to expend millions of dollars in facilities improvements.
Precluding the Company from offering its full spectrum of winter activities
would materially and fundamentally alter key contract features and substantially
interfere with the Company's ability to recover its investments or realize its
planned profit.
The Contract fee to the NPS is calculated at 2 percent of gross receipts (as
defined), subject to review and possible adjustment every five years. For the
three months ended June 30, 2002 and 2001, this fee amounted to $13,700, and
$12,600, respectively, which has been recorded as operating expense.
Flagg Ranch faces competition from hotels, camping areas and trailer facilities
in Yellowstone and Grand Teton National Parks, as well as from a large number of
hotels and motels in Wyoming, Montana and Idaho, offering some facilities which
are similar to those offered by Flagg Ranch. In addition, the business of Flagg
Ranch is susceptible to weather conditions and unfavorable trends in the economy
as a whole. Business could be significantly affected depending upon actions
which might be taken by the NPS if cutbacks are made to their budget. If the NPS
decides to close Yellowstone National Park for the winter months, then Flagg
Ranch would have to discontinue its winter operations. NPS budget cutbacks could
also negatively impact the length of the summer season and the number of
visitors to the Parks and have a corresponding negative impact on Flagg Ranch
revenues.
On May 20, 1997, the Fund for Animals, Biodiversity Legal Foundation et. al.
filed a lawsuit against the NPS challenging the action of the NPS regarding
winter use of Yellowstone and Grand Teton National Parks. The plaintiffs asked
the Federal Court to stop winter activities, primarily snowmobiling and related
snow grooming, until environmental impacts are documented. A settlement
agreement was reached that required the NPS to prepare an environmental impact
statement ("EIS") during which time period the Parks continued activities under
the then existing winter visitor-use plan.
Upon completion of the EIS, the NPS prepared a draft winter-use plan with
several alternatives. The NPS initially adopted the draft winter-use plan which
eliminates snowmobiling from the Park with a phase-in period of three years
during which time the winter snowmobiling operation may be continued.
Page 7 of 16
Per the settlement of a lawsuit that was filed by snowmobile manufacturers and
various other organizations to overturn the NPS's decision, the NPS has agreed
to reopen its decision-making process regarding the use of snowmobiles in
Yellowstone and surrounding Parks. Under the settlement, the Park Service has
committed to reexamine its closure in light of new, environmentally friendly
snowmobile technology and other information provided by the public. While the
Company is optimistic regarding this settlement, until such time as there is a
change in the current winter-use plan, the winter snowmobiling operation will
discontinue operations after the 2002-2003 winter season. This will have a
significant negative impact on the revenues and financial results of the
Company. During fiscal 2002, winter operations accounted for approximately 33
percent of total revenues.
Proprietary rights to certain facility improvements constructed by the Company
(including the new lodge and new cabin units) have been granted to the Company
under the terms of the Contract; however, the NPS may terminate the Contract and
purchase the Company's improvements, upon a determination that the public
interest requires Federal Government ownership of the improvements. In such
event, the Federal Government is required to pay a price for said improvements
equal to the cost of reconstruction less depreciation. If, however the Contract
is terminated by the Federal Government for default by the Company for
unsatisfactory performance as defined in the Contract, then the Federal
Government is required to pay a price equal to the tax basis of the
improvements. At the end of the Contract, if the Company is not the successful
bidder on a new contract for the property, then the Federal Government is
required to purchase from the Company the improvements (including the new lodge
and new cabin units) made to the property at a price equal to the cost of
reconstruction less depreciation.
The Department of Labor ("DOL") has notified the Company, on behalf of current
and past employees, that additional overtime is due for the period beginning
November 1, 1997. Currently the Company pays overtime for any hours in excess of
48 during a one week period. The Company, as well as other Park concessioners in
the area, have operated under an exemption that exists in the Fair Labor
Standards Act. The DOL has claimed that this exemption does not apply due to
conflicting language in the Contract Work Hours Safety Standard Act which
requires overtime to be paid to laborers and mechanics working on a government
contract after 40 hours worked during a week. If the DOL prevails, the estimate
of the additional expense to the Company ranges from $40,000 to $60,000. While
there is no guarantee, the Company believes it will not be subject to the
additional overtime payments.
3. TRANSACTIONS WITH RELATED PARTIES
General and administrative - related party expenses for the three months ended
June 30, 2002 and 2001 represent management fees and administrative expenses
paid to related parties and totaled $73,000 and $34,000, respectively. Related
parties during the three months ended June 30, 2002 and 2001 are owned by the
Company's current majority owner, Robert Walker, or family members. Related
parties during the three months ended June 30, 2002 and 2001 also include a
company owned by the Company's current President, Michael P. Perikly.
For the three months ended June 30, 2002 and 2001, the Company made payments to
PNI Inc. and Walker Consulting, Inc., companies owned by the Company's current
majority owner, Robert L. Walker, for management services of $42,324 and
$25,500, respectively.
For the three months ended June 30, 2002 and 2001, the Company made payments to
KCH Enterprises, Inc., a company owned by the Company's current President,
Michael P. Perikly, for management services of $15,750 each period. For the
three months ended June 30, 2001, $7,500 of this fee was capitalized to
construction in process.
Page 8 of 16
For the three months ended June 30, 2002 and 2001, the Company made payments to
RLW & BJW Enterprises, L.L.C., a company owned by the Company's current majority
owner, Robert L. Walker, for building rent of $15,000 and $0, respectively.
The Company incurred borrowings under line of credit agreements with related
parties (Note 4). Interest incurred for the three months ended June 30, 2002 and
2001 was $13,112 and $16,949, respectively. For fiscal years 2002 and 2001, the
Company capitalized $4,810, and $12,889 of interest, respectively, from related
party and bank lines of credit agreements.
4. NOTES PAYABLE UNDER LINES OF CREDIT
The Company has a line of credit agreement ("Agreement") with an affiliated
company expiring September 30, 2002, which provides for collateralized
borrowings of up to $1,500,000 at an interest rate of prime plus .875 percent.
Borrowings under the Agreement are collateralized by the assets and improvements
of Flagg Ranch. The Company has borrowed $585,000 on this line of credit as of
June 30 2002. The terms of the Agreement contain, among other provisions,
requirements for maintaining minimum cash flows (as defined in the Agreement)
and place limitations on the Company's ability to make loans. As of June 30,
2002, the Company was not in compliance with the minimum cash flow requirement.
The Company has a line of credit agreement with Jackson State Bank ("JSB
Agreement") expiring September 12, 2002, which provides for collateralized
borrowings of up to $500,000 at an interest rate of prime plus .875 percent.
Borrowings under the JSB Agreement are collateralized by the assets and
improvements of Flagg Ranch. The Company has borrowed $175,000 on the JSB
Agreement as of June 30, 2002.
The Company has an Agreement with an affiliated company expiring September 30,
2002, which provides for collateralized borrowings of up to $500,000 at an
interest rate of prime plus .875 percent. Borrowings under the Agreement are
collateralized by the assets and improvements of Flagg Ranch. The Company has
borrowed $390,000 on this line of credit as of June 30, 2002. The terms of the
Agreement contain, among other provisions, requirements for maintaining minimum
cash flows (as defined in the Agreement) and place limitations on the Company's
ability to make loans. As of June 30, 2002, the Company was not in compliance
with the minimum cash flow requirement.
ITEM 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The statements contained in this Report regarding management's anticipation of
the Company's facility completion schedules, quality of facilities, fulfillment
of National Park Service requirements, consumer response to marketing efforts,
ability to offset inflation and adequacy of financing, constitute "forward
looking" statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Management's anticipation is based upon assumptions
regarding levels of competition, acceptance of facilities by consumers,
favorable weather conditions, ability to complete facility construction, the
market in which the Company operates, the stability of the economy and stability
of the regulatory environment. Any of these assumptions could prove inaccurate,
and therefore there can be no assurance that the forward-looking information
will prove to be accurate.
Page 9 of 16
The Company's net loss for the first quarter ended June 30, 2002 was $94,000
($.14 per share). This compares to a net loss of $48,000 ($.07 per share) for
the quarter ended June 30, 2001. The $46,000 increase in loss is primarily due
to a one-time fire-related insurance payment received in the prior year as well
as a loss on sale of assets during the current year. Changes in the Company's
revenues and expenses for the quarters ended June 30, 2002 and 2001 are
summarized below. All references to years, represent quarters ending June 30 of
the stated year.
Flagg Ranch, the principal business of the Company, is operated as a seasonal
resort. The two seasons coincide with the opening and closing dates of
Yellowstone and Grand Teton National Parks. The summer season runs from
approximately May 24 through September 30 and the winter season runs from late
December through early March. Therefore, the first quarter ended June 30, 2002
consists of only thirty-eight days of operations.
Revenues
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Total revenues for 2002 decreased by $29,000 or 4% from 2001. Of this decrease,
$3,000 was from food and beverage sales, $15,000 from gasoline sales, $10,000 in
float trip revenue, $6,000 in trail ride revenue, $2,000 from guided fishing
trip revenue and $32,000 from other revenue representing the one- time insurance
payment made in 2001. Increases of $12,000 in cabin rentals, $15,000 in RV park
rentals, $7,000 in grocery store sales and $5,000 in gift shop sales offset the
above decreases.
Expenses
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The ratio of cost of merchandise sold to sales of merchandise was 61% and 65%,
respectively, in 2002 and 2001. The ratio of operating expenses to total revenue
remained constant at 58% in 2002 and 2001. Operating expenses decreased by
$11,000 in 2002 as compared to 2001. Of this decrease, $18,000 was from labor,
$2,000 in utilities, $6,000 in outside services, $4,000 in advertising, $1,000
in telephone, $3,000 in postage and freight, and $1,000 in licenses and fees.
Offsetting these decreases were increases of $7,000 in office supplies, $9,000
in maintenance, $2,000 in company vehicle and travel, $1,000 in credit card
fees, $3,000 in insurance, $1,000 in property taxes and $1,000 in franchise
fees. General and administrative expenses increased $8,000 or 21% in 2002 as
compared to 2001. General and administrative expenses - related party increased
by $39,000 or 118% in 2002 as compared to 2001.
Inflation
- ---------
The Company expects that it will be able to offset increases in costs and
expenses, principally labor, caused by inflation, by increasing prices on its
services with minimal effect on operations.
Page 10 of 16
Liquidity and Capital Resources
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Working capital deficit decreased to $1,132,000 at June 30, 2002 from $1,135,000
at March 31, 2002. Current assets increased by $487,000 primarily due to
increases in cash, income tax receivable, and merchandise inventories. Current
liabilities increased by $483,000 primarily due to an increase in accrued
liabilities and an increase in advance deposits.
Further, during fiscal 2002, the Company incurred costs of approximately $49,000
related to certain construction projects. The Company may incur additional costs
of approximately $100,000 prior to December 31, 2002 to complete the relocation
of employee housing units as required under the NPS contract.
The Company intends to fund these improvements through existing cash funds and
cash generated from operations. Cash generated from operations for the quarters
ended June 30, 2002 and 2001 was $308,000 and $89,000, respectively. The
construction funds will have to be obtained from outside sources to the extent
they exceed cash generated from operations. There is no guarantee that the
Company will be able to procure financing on favorable terms.
The Company has a line of credit agreement ("Agreement") with an affiliated
company expiring September 30, 2002, which provides for collateralized
borrowings of up to $1,500,000 at an interest rate of prime plus .875 percent.
Borrowings under the Agreement are collateralized by the assets and improvements
of Flagg Ranch. The Company has borrowed $585,000 on this line of credit as of
June 30 2002. The terms of the Agreement contain, among other provisions,
requirements for maintaining minimum cash flows (as defined in the Agreement)
and place limitations on the Company's ability to make loans. As of June 30,
2002, the Company was not in compliance with the minimum cash flow requirement.
The Company has a line of credit agreement with Jackson State Bank ("JSB
Agreement") expiring September 12, 2002, which provides for collateralized
borrowings of up to $500,000 at an interest rate of prime plus .875 percent.
Borrowings under the JSB Agreement are collateralized by the assets and
improvements of Flagg Ranch. The Company has borrowed $175,000 on the JSB
Agreement as of June 30, 2002.
The Company has an Agreement with an affiliated company expiring September 30,
2002, which provides for collateralized borrowings of up to $500,000 at an
interest rate of prime plus .875 percent. Borrowings under the Agreement are
collateralized by the assets and improvements of Flagg Ranch. The Company has
borrowed $390,000 on this line of credit as of June 30, 2002. The terms of the
Agreement contain, among other provisions, requirements for maintaining minimum
cash flows (as defined in the Agreement) and place limitations on the Company's
ability to make loans. As of June 30, 2002, the Company was not in compliance
with the minimum cash flow requirement.
Page 11 of 16
PART II - OTHER INFORMATION
ITEM I. Legal Proceedings
The Department of Labor ("DOL") has notified the Company, on
behalf of current and past employees, that additional overtime
is due for the period beginning November 1, 1997. Currently the
Company pays overtime for any hours in excess of 48 during a
one- week period. The Company, as well as other Park
concessioners in the area, have operated under an exemption that
exists in the Fair Labor Standards Act. The DOL has claimed that
this exemption does not apply due to conflicting language in the
Contract Work Hours Safety Standard Act which requires overtime
to be paid to laborers and mechanics working on a government
contract after 40 hours worked during a week. If the DOL
prevails, the estimate of the additional expense to the Company
ranges from $40,000 to $60,000. While there is no guarantee, the
Company believes it will not be subject to the additional
overtime payments.
ITEM 2. Changes in Securities
None.
ITEM 3. Defaults upon Senior Securities
None.
ITEM 4. Submission of Matters to a Vote of Securities Holders
None
..
ITEM 5. Other Materially Important Events
None
ITEM 6. Exhibits and Reports on Form 8-K
(a) 1. Financial Statements Page
The following financial statements of International Leisure Hosts, Ltd. are
included in Part I, Item 1:
Condensed Consolidated Balance Sheets -
June 30, 2002 (Unaudited) and March 31, 2002 2
Condensed Consolidated Statements of Operations -
Three months ended June 30, 2002 and 2001 (Unaudited) 3
Condensed Consolidated Statements of Cash Flows-
Three months ended June 30, 2002 and 2001 (Unaudited) 4
Notes to Condensed Consolidated Financial Statements 5
Page 12 of 16
3. The following exhibits are incorporated by reference as
indicated:
3.1 By-Laws-Adopted June 22, 1992 filed with Form 10-K dated March
31, 1992
3.2 Articles of Incorporation-filed with Form 10-K dated March 31,
1986, pages 32-41
10.1 United States Department of the Interior National Park Service
Contract-filed with Form 10-Q dated December 31, 1989
99.1 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
99.2 Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Page 13 of 16
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed by the undersigned, thereunto duly authorized.
INTERNATIONAL LEISURE HOSTS, LTD.
(REGISTRANT)
/s/ ROBERT L. WALKER
--------------------------------------------
DATE: August 6, 2002 BY: ROBERT L. WALKER
Chairman and Chief Executive Officer
/s/ MICHAEL P. PERIKLY
--------------------------------------------
DATE: August 6, 2002 BY: MICHAEL P. PERIKLY
President and Principal Financial Officer
Page 14 of 16