<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934.
For the quarterly period ended September 30, 1996
Commission File No. 0-27994
------------
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
(Exact name of small business issuer as specified in its charter)
FLORIDA 59-3203301
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
577 DELTONA BOULEVARD, 2ND FLOOR
DELTONA, FL 32725
407-860-3000
(Address and telephone number
of principal executive offices)
Indicate by check mark whether the issuer (1) 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:
X Yes No
--- ----
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
Class Outstanding at November 11, 1996
- --------------------------- --------------------------------
Common Stock: no par value 4,105,000
Transitional Small Business Disclosure Format (check one): Yes X No
--- ---
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
FORM 10-QSB - SEPTEMBER 30, 1996
INDEX
Page
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
Balance Sheets as of September 30, 1996 (unaudited)
and December 31, 1995 2
Statements of Income for the three and nine months
ended September 30, 1996 and 1995 (unaudited) 3
Statements of Cash Flows for the nine months ended
September 30, 1996 and 1995 (unaudited) 4 - 5
Notes to unaudited interim financial statements 6 - 7
ITEM 2. Management's Discussion and Analysis of Interim Financial
Condition and Results of Operations 8 - 11
PART II - OTHER INFORMATION
ITEM 5. Other Information 12
ITEM 6. Exhibits and Reports on Form 8-K
Exhibit 11 - Statement re computation of per share earnings
Exhibit 27 - Financial data schedule
1
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
BALANCE SHEETS
December 31, September 30,
1995 1996
----------- -------------
ASSETS (Unaudited)
Current assets:
Cash and cash equivalents $286,023 $126,968
Investments in U.S. Treasury securities --- 3,539,947
Accounts receivable, less allowance for doubtful
accounts of $37,755 at December 31, 1995,
and $144,447 at September 30, 1996 317,012 246,360
Securites available-for-sale 16,500 13,000
Directories in progress 87,618 126,309
Deferred income taxes --- 106,750
Other current assets 16,747 114,469
----------- ------------
Total current assets 723,900 4,273,803
Property, plant and equipment, net 169,200 1,222,892
Other assets --- 16,081
----------- ------------
Total assets $893,100 $5,512,776
----------- ------------
----------- ------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $33,318 $147,449
Accrued expenses 39,767 116,859
Deferred revenue 270,257 391,181
----------- ------------
Total current liabilities 343,342 655,489
Deferred income taxes --- 19,000
Shareholders' equity:
Common shares, no par value: 15,000,000 shares
authorized; 2,925,000 issued and outstanding at
December 31, 1995; 4,105,000 issued and outstanding
at September 30, 1996 100 5,096,315
Unrealized loss on available-for-sale securities (17,520) (21,020)
Retained earnings (accumulated deficit) 567,178 (237,008)
----------- ------------
Total shareholders' equity 549,758 4,838,287
----------- ------------
Total liabilities and shareholders' equity $893,100 $5,512,776
----------- ------------
----------- ------------
SEE ACCOMPANYING NOTES.
2
<PAGE>
<TABLE>
<CAPTION>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
STATEMENTS OF INCOME
(unaudited)
Three months ended Nine months ended
September 30 September 30
---------------------------- ---------------------
1995 1996 1995 1996
<S> <C> <C> <C> <C>
----------- ---------- --------- -----------
Net sales $372,104 $441,574 $964,052 $2,312,806
Cost and expenses:
Salaries and commissions 180,245 447,628 445,189 1,132,204
Materials and printing 43,129 97,167 120,298 361,111
Depreciation 9,958 25,325 22,922 60,734
Other operating costs 53,621 442,123 161,520 1,067,618
---------- ---------- --------- -----------
286,953 1,012,243 749,929 2,621,667
---------- ---------- --------- -----------
Income (loss) from operations 85,151 (570,669) 214,123 (308,861)
Other income (expense)
Interest income, net --- 59,541 --- 2,203
Other 1,274 --- 3,160 6,488
---------- ---------- --------- -----------
Income (loss) before provision
for income taxes 86,425 (511,128) 217,283 (300,170)
Provision for income taxes --- (191,631) --- (63,162)
---------- ---------- --------- -----------
Net income (loss) $86,425 ($319,497) $217,283 ($237,008)
---------- ---------- --------- -----------
---------- ---------- --------- -----------
Net income (loss) per share --- ($.08) --- ($0.07)
---------- ---------- --------- -----------
---------- ---------- --------- -----------
Shares used in computation of
net income (loss) per share --- 4,111,569 --- 3,535,210
Pro forma data:
Net income (loss) before
provision for income taxes $86,425 ($511,128) $217,283 ($300,170)
Pro forma provision for
income taxes 32,574 (191,631) 81,927 (111,272)
---------- ---------- --------- -----------
---------- ---------- --------- -----------
Pro forma net income (loss) $53,851 ($319,497) $135,356 ($188,898)
---------- ---------- --------- -----------
---------- ---------- --------- -----------
Pro forma net income (loss) per share $.02 ($.08) $.05 ($.05)
---------- ---------- --------- -----------
---------- ---------- --------- -----------
Shares used in computation of pro
forma net income (loss) per share 2,955,000 4,111,569 2,955,000 3,535,210
---------- ---------- --------- -----------
---------- ---------- --------- -----------
</TABLE>
SEE ACCOMPANYING NOTES.
3
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
STATEMENTS OF CASH FLOWS
(unaudited)
Nine Months ended Sept. 30
1995 1996
--------------------------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ 217,283 $ (237,008)
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
Depreciation 22,922 60,734
Bad debt expense 30,563 349,195
Provision for deferred income taxes --- (87,750)
Exchange of advertising for machinery & equipment (6,684) ---
Accretion of bridge notes --- 77,778
Interest accrued on U.S. Treasury securities --- (70,187)
Increase in accounts receivable (106,266) (278,543)
Increase in directories in progress (105,279) (38,691)
(Increase) decrease in other assets 3,037 (113,803)
Increase in accounts payable 21,308 114,131
Increase in accrued expenses --- 77,092
Increase in deferred revenue 314,265 120,924
---------- ---------
Net cash provided by (used in) operating activities 391,149 (26,128)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of securities available-for-sale (67,860) ---
Purchases of U.S. Treasury securities --- (4,011,863)
Sale of U.S. Treasury securities 542,103
Purchases of property, plant and equipment (66,305) (1,114,426)
---------- ----------
Net cash used in investing activities (134,165) (4,584,186)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of shareholder advances (13,610) ---
Distributions to shareholders (48,004) ---
Repayment of promissory notes to shareholders --- (447,178)
Net proceeds from initial public offering of
common shares --- 4,898,437
---------- ----------
Net cash (used in) provided by financing activities (61,614) 4,451,259
Net increase (decrease) in cash and cash equivalents 195,370 (159,055)
Cash and cash equivalents at beginning of period 15,524 286,023
Cash and cash equivalents at end of period $ 210,894 $ 126,968
--------- ---------
--------- ---------
SEE ACCOMPANYING NOTES.
4
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
STATEMENTS OF CASH FLOWS
(unaudited)
Nine Months ended Sept. 30
1995 1996
--------------------------
SUPPLEMENTAL CASH FLOW INFORMATION
Exchange of advertising for supplies $ 13,081 $ ---
------------------------
------------------------
Interest paid $ --- $ 11,695
------------------------
------------------------
Income taxes paid --- $72,068
------------------------
------------------------
Distribution to shareholders in exchange
for promissory notes $ --- $ 268,307
------------------------
------------------------
SEE ACCOMPANYING NOTES.
5
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
FORM 10-QSB - SEPTEMBER 30, 1996
NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying unaudited financial statements of The Publishing Company
of North America, Inc. (the "Company") have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B.
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, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included in the
accompanying unaudited financial statements. The results of operations of any
interim period are not necessarily indicative of the results of operations for
the fiscal year. For further information, refer to the financial statements and
footnotes thereto included in the Company's registration statement on Form SB-2
relating to the Company's initial public offering of its common stock which was
made effective on May 17, 1996. Certain amounts in the 1995 financial
statements have been reclassified to conform to the presentation adopted in
1996.
2. CASH AND CASH EQUIVALENTS
The Company considers all highly-liquid investments with a maturity of
three months or less when purchased to be cash equivalents.
3. ACCOUNTS RECEIVABLE
Accounts receivable are comprised primarily of amounts due from advertisers
in the bar association directories. The Company revised its allowance for
doubtful accounts at September 30, 1996 to 8% of net sales for amounts owed six
months or less; in addition, the Company provided a full reserve for amounts
owed more than six months, based upon an expectation that a small percentage of
these monies will be collected. The effect of this revision was an increase in
the allowance for doubtful accounts and an increase to bad debt expense of
$57,407. All amounts owed more than one year are written off.
4. REVENUE RECOGNITION
Revenues and related costs are recorded by the Company upon shipment of
directories. Costs accumulated under directories in progress are stated at
estimated costs, not in excess of estimated realizable value. Deferred revenue
represents amounts received from advertisers prior to shipment of the related
directories.
5. INCOME TAXES
Until January 1, 1996 the Company elected by consent of its shareholders to
be taxed under the provisions of Subchapter S of the Internal Revenue Code.
Under those provisions, the Company did not pay federal corporate income taxes
on its taxable income; instead, the shareholders were liable for individual
federal income taxes on the Company's taxable income. In March, 1996 the
Company terminated its S Corporation status effective January 1, 1996 and
thereafter will be taxed as a C Corporation. Accordingly, a deferred tax
liability of $48,110 was recognized and charged to income as of
6
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
FORM 10-QSB - SEPTEMBER 30, 1996
NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS
January 1, 1996; this charge relates directly to the conversion and is in
addition to any taxes otherwise due for 1996 income. In March, 1996 the Company
made a distribution of $178,871 to existing shareholders for estimated federal
income taxes due on 1995 S Corporation income and the Company issued $268,307 of
notes payable to existing shareholders for S Corporation earnings not previously
declared as dividends during 1995. These notes were paid in July, 1996. Pro
forma income tax adjustments had the Company been a C corporation for all
periods presented are provided in the accompanying financial statements.
6. NET INCOME PER SHARE
Net income per share and pro forma net income per share are computed based
on the weighted average number of common shares and common stock options using
the treasury stock method. In accordance with the Securities and Exchange
Commission requirements, common and common equivalent shares issued by the
Company at prices below the public offering price during the 12-month period
prior to the date of the initial public offering on May 17, 1996 have been
included in the calculation as if they were outstanding for all periods prior to
the offering using the treasury stock method and the initial public offering
price.
Historical net income per share is not considered meaningful for the
periods ended prior to January 1, 1996 due to the Company's S Corporation
status; accordingly, such per share information is not presented for such
periods. Pro forma net income per share is provided to show the effect on the
historical financial information had the Company operated as a C Corporation
since inception and excludes the $48,110 charge to income in connection with the
termination of its S Corporation status on January 1, 1996.
7. USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles require management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
8. INITIAL PUBLIC OFFERING OF THE COMPANY'S COMMON STOCK
Pursuant to a registration statement on Form SB-2 with the Securities and
Exchange Commission, on May 17, 1996 the Company's common stock commenced
trading on the NASDAQ National Market System under the symbol PCNA. Gross
proceeds of $6,325,000 were raised from the sale of 1,150,000 shares at $5.50
per share. Net proceeds to the Company after paying all related costs of the
offering were approximately $4,900,000.
9. PURCHASE OF LAND AND BUILDING
In September, 1996 the Company purchased for approximately $900,000 land
and a building in Lake Helen, Florida, for use as its corporate headquarters.
Modifications to improve the property's usefulness to the Company have begun and
are expected to raise the investment to approximately $1,025,000. The Company
has received a loan commitment for a mortgage not to exceed $800,000 after
completion of the improvements.
7
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
FORM 10-QSB - SEPTEMBER 30, 1996
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
INTERIM FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
RESULTS OF OPERATIONS
The Company incurred a loss of $319,497 for the three months ended
September 30, 1996 and $237,008 for the nine months so ended. The most
significant factors affecting the Company's results of operations in the most
recent three and nine month periods are the postponement of shipment of four
directories comprising approximately $660,000 in revenues, increases in the
Company's reserves for bad debt, and an increase in costs related to the
Company's growth in staff. These factors are described more fully below.
Total revenues for the three and nine month periods ended September 30,
1996 were $441,574 and $2,312,806, respectively, compared to $372,104 and
$964,052 for the same periods in 1995. This represents a 19% and 140% increase
in revenues from 1995 to 1996 for the three and nine month periods,
respectively. In the three and nine month periods ended September 30, 1996 the
Company published 9 and 36 directories, respectively, compared to 8 and 20 for
the same periods in 1995. During the most recent quarter, there were four
directories for which the advertising sections had been printed and for which
the Company had substantially completed its work for the front sections
containing the bar association information but, because of delays in the
associations' proofing of those sections, the directories were not completed at
September 30, 1996. As a result, the Company was unable to recognize
approximately $660,000 in revenues in the most recent quarter. All four of
those directories have been shipped since September 30, 1996. Costs associated
with these directories approximated $220,000, of which approximately $100,000
was materials, printing, and other production-related expenses and approximately
$120,000 was salaries, commissions and other operating costs. There can be no
assurances that the Company will not again experience this problem in future
periods.
For the three and nine months ended September 30, 1996 salaries and
commissions were 101% and 49% of revenues as compared to 48% and 46% for the
same period a year earlier. Had the Company been able to recognize revenues on
the four directories described above, salaries and commissions would have
increased $83,729 for the most recent quarter and would have been 48% of the
higher revenues, which is proportionate to sales in other periods discussed
above, but higher than in the first two quarters of 1996. The Company believes
it may be able to improve sales and in-house production efficiencies through
certain industry-specific computer-based systems and is currently evaluating
investments in such.
The Company's costs to print directories, which includes primarily
materials, printing, and binding, was approximately 22% of revenues for the most
recent quarter and 16% for the nine months ended September 30 of this year.
These costs were 12% for the same periods a year earlier and 14% for the six
months ended June 30, 1996. Five of the 9 directories published in the most
recent quarter had costs in excess of 14%. On some directories the Company had
to curtail sales of advertising in order to meet deadlines, thereby curtailing
the revenues; therefore, the ratio of advertising revenues to the relatively
fixed production costs was adversely impacted. Also in order to meet deadlines,
the Company had to contract some of the production to sources which had the
productive capacity but which were more expensive. The Company outsources all
of its film, printing, and binding work. It is likely that materials and
printing will be higher as a percentage of revenues in the last quarter than
in the first six months of 1996.
Operating costs other than materials and printing, salaries and
commissions, and depreciation increased to $442,123 (100% of revenues) for the
three months ended September 30, 1996 from $53,621 (14% of revenues) for the
same period in 1995. As with salaries and commissions, the postponement of
shipment of four directories as described above caused operating costs as
defined above to be extremely high as a percentage of revenues. Had the Company
completed shipment of the four directories, these operating costs would have
increased approximately $30,000 and would have been approximately 43% of the
higher revenues; while this is much lower than the 100% cited above, it still is
much higher than it was in prior periods. Also significant in the increase in
these operating costs were adjustments to the
8
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
FORM 10-QSB - SEPTEMBER 30, 1996
MANAGEMENT'S DISCUSSION AND ANALYSIS
Company's estimates for bad debt allowances and its recognition of pre-payment
discounts taken. During the most recent quarter, the Company discovered that
the computer-based custom database system upon which the Company has relied for
tracking sales and receivables had included as part of the receivables total
$48,495 in pre-payment discounts earned and taken. Of this amount, $6,807
belonged in the most recent quarter and the remaining $41,288 related to prior
periods. The Company also discovered $136,008 of pre-payment discounts taken
which were unearned, which had been reported as part of the receivables total,
and which did not appear as due on an account-by-account basis by the
computer-based custom database system. Management considers that the unearned
discounts are owed to the Company and is currently evaluating it options
regarding the collection of these amounts owed. Due to the aging of many of
these accounts and because management believes that enforcing collection at this
time may result in a reduction of future renewal revenues significantly in
excess of the potential cash receipts, the Company has provided for a full
reserve of these amounts at this time. The database system had also reported
certain other amounts as a part of the total receivable when, in fact, the
amounts were not collectible. Primarily for the reasons cited above, the
Company increased its allowance for doubtful accounts and operating costs as
defined above included bad debt expense of $136,537 for the most recent quarter;
this is 31% of the total of these operating costs for the period. This
discovery has caused the Company to decide to amend its Form 10-QSB for the
period ended June 30, 1996. The Company believes all adjustments necessary are
being made in this quarterly report and the amended report for the quarter ended
June 30, 1996. In response to these matters, the Company has implemented a
number of actions to detect unearned discounts and problem receivables much
earlier so that timely corrective action can be taken to reduce future reserve
requirements.
For the nine months ended September 30 other operating costs as defined
above increased to $1,067,617 (46% of revenues) in 1996 from $161,520 (17% of
revenues) in 1995. Significant factors affecting the most recent nine months
include the postponement of shipment of the four directories discussed above
and the adjustments relating to the pre-payment discounts and allowance for
doubtful accounts discussed above. Another significant factor is the
Company's growth in staff. Since the Company's initial public offering in
May of this year, the Company has been on an aggressive growth plan.
Employment has increased to approximately 130 people at November 9 from
approximately 60 at May 31, 1996; over half of the Company's employees are
engaged in sales of advertising for the Company's publications. In early
July of this year the Company opened a new sales office in Orlando, Florida,
and in September it purchased land and a 21,500 square foot building in Lake
Helen, Florida; the building was sold as a result of a bankruptcy and is
approximately three times the square footage of the Company's current
facilities in Deltona, Florida. The Company has moved a portion of its
operations in Deltona to the Lake Helen facility and plans to move the
balance in late November.
Many of the costs which the Company is incurring and will incur later this
year will not result in an immediately proportionate growth in revenue. This is
due to the time between the expenditure and the recognition of revenues from
publications advertising which results from that expenditure. For example,
there is a delay of several months between the time a salesperson is hired and
any sales of advertising by that person will be recognized as revenue upon the
shipment of a directory containing that advertising. Therefore, expenses as a
percentage of revenues are expected to be somewhat higher in the last half of
1996 as the Company continues its expansion. The Company may incur a loss for
the year ended December 31, 1996.
9
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
FORM 10-QSB - SEPTEMBER 30, 1996
MANAGEMENT'S DISCUSSION AND ANALYSIS
For the nine months ended September 30, 1996 the Company incurred interest
expense of $89,472; of this amount, $82,710 was related to bridge financing
prior to the Company's initial public
offering. The Company earned $91,675 in interest income during the most recent
nine month period, primarily on treasury securities purchased with proceeds from
the public offering.
The Company may incur a loss for the year ended December 31, 1996.
Results of operations for the quarter then ended are uncertain,
notwithstanding the contribution of the four dirctories postponed from the
most recent quarter. The last quarter of 1996 will again be affected by
proofing turn-around times by the bar associations, limited selling times due
to publication deadlines, and the impact of holiday schedules upon the
production capacity of the Company's third-party printers and other
suppliers. The Company maintains a strong backlog of contracts and, in fact,
this strong backlog contributes to the Company's difficulty in increasing
revenues per directory due to scheduled deadlines.
LIQUIDITY AND CAPITAL RESOURCES
Net cash used in operations was $26,128 for the nine months ended September
30, 1996 compared to $391,149 provided by operations for the same period a year
earlier. The most significant reason for the decrease in cash provided from
operations in 1996 from 1995 was the operating loss for reasons described above.
Deferred revenue, which represents amounts received from advertisers prior to
shipment of the related directories, increased $120,924 from $270,257 at
December 31, 1995 to $391,181 at September 30, 1996. This was primarily the
result of four directories which were subtantially complete but unable to be
shipped at September 30, 1996. Directories in progress, which represents costs
accumulated for directories unpublished at the end of the period, increased
$38,691 from $87,618 at December 31, 1995 to $126,309 at September 30, 1996 for
the same reason.
At September 30, 1996 the Company had investments of approximately
$3,540,000 in U.S. Treasury securities and approximately $127,000 in cash and
cash equivalents; the Company had no debt. During September, the Company closed
on the purchase of land and a building and, as of September 30, had a total of
approximately $900,000 invested in the property. The Company has modifications
to the interior of the building under progress and later this year plans to
convert some of the land to additional parking area. These additional
improvements are expected to bring the investment in the property to
approximately $1,025,000. The Company has received a loan commitment for a
mortgage not to exceed $800,000 after completion of the improvements.
During the nine months ended September 30, 1996 the Company distributed the
1995 S Corporation earnings of $447,178 to shareholders as of December 31,
1995.
The Company has no commitments at this time to acquire a material amount of
capital assets other than the improvements to the land and building discussed
above.
Based on current cash and investment balances and the Company's anticipated
results of future operations, the Company believes that it has sufficient cash
resources to fund its operations for the next twelve months or more.
10
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
FORM 10-QSB - SEPTEMBER 30, 1996
FORWARD-LOOKING STATEMENTS
The statements made above relating to the Company ability to improve
sales and in-house production efficiencies through industry-specific
computer-based systems, anticipated materials and printing costs for the
balance of 1996, the increase in anticipated expenses as a percentage of
revenues, the Company's results of operations for the quarter and year ended
December 31, 1996 and the securing of mortgage financing are forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933
and Section 21E of the Securities Exchange Act of 1934. The results
anticipated by any or all of these forward-looking statements may not occur.
Important factors that may cause actual results to differ materially from the
forward-looking statements include the following: (1) the Company's ability
to find a suitable computer-based system; (2) the Company's ability to
successfully install and implement a computer-based system; (3)
unanticipated increases in third-party printing costs as a result of
increases in labor or paper costs; (4) the Company's ability to continue to
sell sufficient advertising per directory published in order to maintain the
same percentages of materials and printing costs to directory revenues; (5)
unplanned postponement of the shipment of directories due to factors over
which the Company has no control; (6) unanticipated changes in the financial
markets, contract issues, or environmental concerns that affect mortgage
financing; and (7) unanticipated cancellation by bar associations of
existing contracts to publish directories.
11
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
FORM 10-QSB - SEPTEMBER 30, 1996
PART II - OTHER INFORMATION
ITEM 5. Other Information
Not applicable.
ITEM 6. Exhibits and Reports on Form 8-K
a. Exhibits
1. Exhibit 11 - Statement re computation of per share earnings
2. Exhibit 27 - Financial Data Schedule
b. No reports on Form 8-K were filed during the quarter ended September
30, 1996.
12
<PAGE> THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
FORM 10-QSB - SEPTEMBER 30, 1996
In accordance with the requirements of the Securities Exchange Act of 1934,
the registrant caused this report to be signed on its behalf on November 19,
1996 by the undersigned, thereunto duly authorized.
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
/s/ Peter S. Balise
----------------------------------
President (Chief Executive Officer)
/s/ James M. Koller
----------------------------------
Chief Financial Officer (Principal
Financial and Accounting Officer)
<PAGE>
THE PUBLISHING COMPANY OF NORTH AMERICA, INC.
FORM 10-QSB - SEPTEMBER 30, 1996
EXHIBITS
ITEM 6. Exhibits and Reports on Form 8-K
a. Exhibits
1. Exhibit 11 - Statement re computation of per share earnings
Three months Nine months
ended ended
Primary Sept. 30, Sept. 30,
1996 1996
------------ -----------
Average shares outstanding 4,111,000 3,530,883
Net effect of dilutive stock options
based on the treasury stock method
using the average market price 569 4,327
Total 4,111,569 3,535,210
------------ -----------
------------ -----------
Net income (loss) ($319,497) ($237,008)
------------ -----------
------------ -----------
Per share amount ($0.08) ($0.07)
------------ -----------
------------ -----------
Fully-diluted
Average shares outstanding 4,111,000 3,530,883
Net effect of dilutive stock options
based on the treasury stock method
using the period-end market price,
if higher than the average market price 569 4,327
------------ -----------
Total 4,111,569 3,535,210
------------ -----------
------------ -----------
Net income (loss) ($319,497) ($237,008)
------------ -----------
------------ -----------
Per share amount ($0.08) ($0.07)
------------ -----------
------------ -----------
14
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S UNAUDITED FINANCIAL STATEMENTS FOR THE PERIOD ENDED SEPTEMBER 30, 1996
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 126,968
<SECURITIES> 3,539,347
<RECEIVABLES> 390,807
<ALLOWANCES> (144,447)
<INVENTORY> 0
<CURRENT-ASSETS> 4,273,803
<PP&E> 1,327,380
<DEPRECIATION> 104,488
<TOTAL-ASSETS> 5,512,776
<CURRENT-LIABILITIES> 655,489
<BONDS> 0
0
0
<COMMON> 5,096,315
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<INCOME-PRETAX> (300,170)
<INCOME-TAX> (63,162)
<INCOME-CONTINUING> (237,008)
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<NET-INCOME> (237,008)
<EPS-PRIMARY> (0.07)
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</TABLE>
