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: March 31, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER: 333-4066
KAYENTA KREATIONS, INC.
(Exact name of registrant as specified in its charter)
NEVADA 87-0554463
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1020 Belmont Avenue
Salt Lake City, Utah 84105
(Address of principal executive offices)
(801) 521-4128
(Registrant's telephone number, including area code)
Check whether the issuer (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such report(s), and (2)
has been subject to such filing requirements for the past 90
days.
YES [X] NO [ ]
The number of $.001 par value common shares outstanding at March
31, 1999: 1,018,900
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
KAYENTA KREATIONS, INC.
(A Development Stage Company)
CONDENSED BALANCE SHEETS
ASSETS
March 31, December 31,
1999 1998
(Unaudited)
CURRENT ASSETS
Cash in bank $2,487 $5,052
Inventory 934 1,015
________ _________
Total Current Assets 3,421 6,067
________ _________
EQUIPMENT
Office equipment and displays, less depreciation 9,058 9,699
of $3,788 and $3,146 ________ _________
OTHER ASSETS
Organization costs, net amortization of $652 348 398
and $602 ________ _________
Total Other Assets 348 398
________ _________
TOTAL ASSETS $12,827 $16,164
======== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities $227 $579
State franchise tax payable 100 200
________ _________
Total Current Liabilities 327 779
________ _________
STOCKHOLDERS' EQUITY
Preferred stock; $.001 par value, 5,000,000 shares
authorized, no shares issued and outstanding 0 0
Common stock; $.001 par value, 50,000,000 shares
authorized, 1,018,900 and 1,018,900 shares 1,019 1,019
issued and outstanding respectively
Capital in excess of par value 47,193 47,193
Earnings (deficit) accumulated during the (35,712) (32,827)
development stage ________ _________
Total Stockholders' Equity 12,500 15,385
________ _________
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $12,827 $16,164
======== =========
See notes to Condensed Financial Statements
<PAGE>
KAYENTA KREATIONS, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
For the Three Cumulative
Months Ended During the
March 31, Development
1999 1998 Stage
SALES
Sales - net $183 $70 $1,119
Less cost of Sales (81) (23) (593)
__________________________
Gross Margin 102 47 526
__________________________
SELLING, GENERAL AND ADMINISTRATIVE
Accounting and legal 1,150 0 7,835
Amortization 50 50 652
Travel 0 108 2,057
Wages 0 90 2,678
Marketing 300 50 6,365
Equipment rental 75 0 2,246
Administrative 575 259 3,944
Office supplies 42 337 4,271
Utilities 0 42 743
Meals and entertainment 0 0 817
Depreciation 642 465 3,788
Taxes 0 0 300
Equipment repairs 175 674 1,013
Miscellaneous 0 0 382
__________________________
Total Selling, General and Administration 3,009 2,075 37,091
__________________________
NET INCOME FROM OPERATIONS (2,907) (2,028) (36,565)
OTHER INCOME (EXPENSE)
Interest income 24 123 886
Interest expense (2) (5) (33)
__________________________
NET INCOME BEFORE TAXES (2,885) (1,910) (35,712)
PROVISIONS FOR INCOME TAXES 0 0 0
__________________________
NET INCOME (LOSS) $(2,885)$(1,910) $(35,712)
================ =========
EARNINGS (LOSS) PER SHARE $0.00 $0.00 $0.04
================ =========
See notes to Condensed Financial Statements
<PAGE>
KAYENTA KREATIONS, INC.
(A Development Stage Company)
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Three Cumulative
Months Ended During the
March 31, Development
1999 1998 Stage
CASH FLOWS FROM OPERATING ACTIVITIES
Cash from sales $183 $70 $1,119
Cash paid for organization costs 0 0 (1,000)
Cash from interest 24 123 886
Cash paid for interest (2) (5) (33)
Cash paid for supplies and employee services (2,670) (1,750) (33,652)
Cash paid for taxes (100) (100) (200)
________ ________ ________
Net Cash (Used) by Operating Activities (2,565) (1,662) (32,880)
________ ________ ________
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of equipment 0 0 (12,845)
________ ________ ________
Net cash (Used) by Investing Activities 0 0 (12,845)
________ ________ ________
CASH FLOWS FROM FINANCING ACTIVITIES
Sale of common stock 0 0 62,725
Direct offering costs 0 0 (14,533)
Contributed capital 0 0 20
________ ________ ________
Net Cash Provided (Used) By Financing 0 0 48,212
Activities ________ ________ ________
NET INCREASE (DECREASE) IN CASH (2,565) (1,662) 2,487
CASH - BEGINNING OF PERIOD 5,052 16,777 0
________ ________ ________
CASH - END OF PERIOD $2,487 $15,115 $2,487
======== ======== ========
RECONCILIATION OF NET INCOME TO NET CASH
PROVIDED (USED) BY OPERATING ACTIVITIES
NET INCOME (LOSS) $(2,885) $(1,910)$(35,712)
________ ________ ________
Adjustments to reconcile net income(loss) to
net cash provided(used) by operating
activities
Amortization of organization costs 50 50 652
Depreciation 641 465 3,787
Change in assets and liabilities
Organization costs 0 0 (1,000)
Inventory 81 23 (934)
Accounts payable (352) (290) 227
Franchise taxes payable (100) 0 100
________ ________ ________
Total Adjustments 320 248 2,832
________ ________ ________
NET CASH PROVIDED(USED) BY OPERATINGACTIVITIES$(2,565) $(1,662)$(32,880)
======== ======== ========
See notes to Condensed Financial Statements
<PAGE>
KAYENTA KREATIONS, INC.
(A Development Stage Company)
NOTES TO UNAUDITED FINANCIAL STATEMENTS
NOTE 1 - CONDENSED FINANCIAL STATEMENTS
The accompanying financial statement have been prepared by the
Company without audit. In the opinion of management, all
adjustments (which include only normal recurring adjustments)
necessary to present fairly the financial position, results of
operation and cash flows at March 31, 1999 and 1998 and for all
periods presented have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted. It
is suggested that these condensed financial statements be read in
conjunction with the financial states and notes thereto included
in the Company's December 31, 1998 audited financial statements.
The results of operations for the periods ended March 31, 1999 and
1998 are not necessarily indicative of the operating results for
the full year.
<PAGE>
ITEM 2: MANAGEMENT'S DISCUSSION & ANALYSIS OR PLAN OF OPERATIONS
The Company was incorporated on December 26, 1995. The
Company has not yet generated significant revenues from
operations and is considered a development stage company. To
date, activities have been limited to organizational matters, the
preparation and filing of the registration statement to register
a public offering of its securities, pursuant to which the
Company offered and sold 218,900 shares of common stock and
raised gross proceeds of $54,725, the closing of such offering
and the initial commencement of limited operations. The Company
has no significant assets other than the net proceeds from the
offering and the assets acquired therewith.
Management's plan of operation for the next twelve months is
to continue to use the net proceeds from the offering to produce
an inventory of products, and attempt to market such products.
The Company has also used offering proceeds to make equipment
purchases and other capital expenditures for assets being used in
connection with the business, including a computer system, a
digitized scanner software program, a fax machine, a laser
printer, a color printer and a photocopy machine. The balance of
the proceeds is being used to provide working capital for the
operation of the Company's proposed business.
There is absolutely no assurance that the Company will be
able, with the proceeds of the offering, to acheive profitable
operations. At this time, no assurances can be given with
respect to the length of time after commencement of operations
that it will be necessary to fund operations from proceeds of the
offering. If the marketing of the initial printing of books is
successful, management intends for the foreseeable future to
reinvest the revenues derived therefrom for additional printings
and editions of the coloring art books, and for development and
marketing costs relating to a line of colored pencils which the
Company also intends to eventually market.
Management believes that the net proceeds of the offering
will be sufficient for initial printing, and to begin marketing
the coloring art books, after which time management anticipates
that the Company will begin generating revenues from sales to
cover ongoing expenses. However, there is absolutely no
assurance of this and the Company has only limited sales thus
far. If the initial marketing of the coloring art books is
unsuccessful, investors will have lost their money and management
will not attempt to pursue further marketing efforts with respect
to such product, and it is unlikely the Company would have the
financial ability to do so in any event. Instead management will
call a shareholders meeting to decide whether to liquidate the
Company or what direction the Company will pursue, if any.
However, the Company presently has no plans, commitments or
arrangements with respect to any other potential business venture
and there is no assurance the Company could become involved with
any other business venture, especially any business venture
requiring significant capital.
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
(a) None.
(b) None.
(c) See Part I, Item 1 (financial statments) and Item 2
(management's discussion) for financial information and
a discussion regarding use of proceeds.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
None
<PAGE>
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.
Kayenta Kreations, Inc.
Date: May 19, 1999 by: /s/ Michelle Barlow
Michelle Barlow, Chairman
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS OF KAYENTA KREATIONS, INC., AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 2,487
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 934
<CURRENT-ASSETS> 3,421
<PP&E> 12,846
<DEPRECIATION> 3,788
<TOTAL-ASSETS> 12,827
<CURRENT-LIABILITIES> 327
<BONDS> 0
0
0
<COMMON> 1,019
<OTHER-SE> 11,481
<TOTAL-LIABILITY-AND-EQUITY> 12,827
<SALES> 183
<TOTAL-REVENUES> 183
<CGS> 81
<TOTAL-COSTS> 102
<OTHER-EXPENSES> 3,009
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2
<INCOME-PRETAX> (2,885)
<INCOME-TAX> 0
<INCOME-CONTINUING> (2,885)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,885)
<EPS-PRIMARY> (0.00)
<EPS-DILUTED> 0
</TABLE>
