<PAGE>
<PAGE>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended January 31, 1998
or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from __________ to
___________
Commission File Number 1-12119
AMERICAN CRAFT BREWING INTERNATIONAL LIMITED
-------------------------------------------------
(Exact name of registrant as specified in its charter)
Bermuda 72-1323940
- - -------------------------------- -----------------------------------
State or other jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or organization
One Galleria Boulevard, Suite 1714, Metairie, Louisiana 70001
- - -------------------------------------------------------- -----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (504) 849-2739
Indicate by a check mark whether the registrant: (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 reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--- ---
Number of shares of common stock outstanding
At March 17, 1998: 3,796,876
<PAGE>
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AMERICAN CRAFT BREWING INTERNATIONAL LIMITED
FORM 10-Q
PART I FINANCIAL INFORMATION
ITEM 1. Financial Statements (unaudited):
Consolidated Balance Sheets-
January 31, 1998 and October 31, 1997
Consolidated Statements of Operations-
Three months ended January 31, 1998 and 1997
Consolidated Statements of Cash Flows-
Three months ended January 31, 1998 and 1997
Notes to Consolidated Financial Statements
ITEM 2. Management's Discussion and Analysis of Financial Condition
And Results of Operations
PART II OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K
2
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
AMERICAN CRAFT BREWING INTERNATIONAL LIMITED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Amounts expressed in United States Dollars)
(Unaudited)
<TABLE>
<CAPTION>
January 31, October 31,
1998 1997
------------ ------------
(Unaudited) (Audited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 14,745 $ 59,619
Accounts receivable, 314,294 216,928
Inventories 308,888 395,480
Prepaids and other current assets 128,874 139,420
----------- -----------
Total current assets 766,800 811,447
Equipment and capital leases, net 2,652,931 3,349,015
Rental, utility and other deposits 558,845 706,475
Deposits and advanced royalties for beer purchases 852,067 621,827
Notes receivable from officer/shareholder 35,000 35,000
Total assets $ 4,865,644 $ 5,599,641
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 1,423,866 $ 1,483,509
Current loans payable 954,712 415,053
Capital lease obligations, current portion 4,115 20,657
Shareholders' loans 100,000 150,000
----------- -----------
Total current liabilities 2,482,694 2,069,219
Capital lease obligations, net of current portion 5,801 7,660
----------- -----------
Total liabilities 2,488,495 2,076,879
Minority Interests 279,819 356,401
Commitments and Contingencies
Shareholders' equity:
Preferred stock, $0.01 par, 500,000 shares authorized, none issued -- --
Common stock, $0.01 par, 10,000,000 shares authorized, 3,796,876
shares issued and outstanding 37,969 36,969
Common stock warrants, 2,090,876 outstanding 181,906 181,906
Additional paid-in capital 7,437,205 7,388,205
Cumulative translation adjustment (119,405) (46,887)
Accumulated deficit (5,440,344) (4,393,832)
----------- -----------
Total shareholders' equity 2,097,330 3,166,361
----------- -----------
Total liabilities and shareholders' equity $ 4,865,644 $ 5,599,641
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial
statements.
3
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<PAGE>
AMERICAN CRAFT BREWING INTERNATIONAL LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts expressed in United States Dollars)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
January 31, January 31,
1998 1997
---------- ----------
<S> <C> <C>
Sales $514,787 $ 174,564
Cost of sales (467,828) (111,422)
----------- ----------
Gross profit 46,969 63,142
Selling, general and administrative expenses (794,547) (380,625)
Non-operating expenses (273,711) --
Interest income (expense), net (25,245) 11,929
Other income (expense), net 1,349 (36,047)
----------- ---------
Total expenses (1,092,154) (404,743)
Loss on sale of subsidiary (63,919) --
Loss before income taxes (1,109,104) (341,601)
Income tax benefit -- 14,487
---------- ----------
Loss after income taxes (1,109,104) ( 327,114)
Minority interests 25,557 229
---------- ----------
Net loss ($1,083,547) ($326,885)
============ ==========
Net loss per common share ($0.29) ($0.09)
------------ ----------
Weighted average number of shares outstanding 3,777,311 3,696,876
============ ==========
</TABLE>
The accompanying notes are an integral part of these financial
statements.
4
<PAGE>
<PAGE>
AMERICAN CRAFT BREWING INTERNATIONAL LIMITED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts expressed in United States Dollars)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
-------------------------------
January 31, January 31,
1998 1997
---------------- -------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss ($1,083,547) ($ 326,885)
Adjustments to reconcile net loss to net cash used in
operating activities:
Noncash loss on sale of subsidiary 42,794
Depreciation and amortization 70,207 20,703
Deferred income taxes 0 (14,487)
Minority interests (25,557) (229)
Increase in operating assets, net of assets acquired:
Accounts receivable, net (99,366) (106,176)
Inventories 45,315 (112,646)
Prepaids and other current assets (249) (41,921)
Other assets (96,203) (464,920)
Notes receivable from officer/shareholder --
Increase in operating liabilities, net of liabilities acquired:
Accounts payable and accrued liabilities 83,337 (29,379)
----------- ------------
Net cash used in operating activities (1,062,269) (1,075,940)
----------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of subsidiary 500,000
Purchases of equipment (20,710) (413,202)
Investment in AmBrew USA, net of cash received (90,502)
----------- ------------
Net cash used in investing activities 478,290 (503,704)
----------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Contribution from joint venture partner 231,402
Payment of capital lease obligations (1,467) (3,215)
Additional paid in capital 49,355 --
Proceeds from loan 492,764 --
Repayment of shareholders' loans -- --
----------- ------------
Net cash provided by financing activities 540,652 228,187
----------- ------------
Effect of exchange rate changes on cash and cash equivalents (1,546) --
----------- ------------
Decrease in cash and cash equivalents (44,873) (1,351,457)
Cash and cash equivalents at beginning of period 59,618 5,780,672
----------- ------------
Cash and cash equivalents at end of period $ 14,745 $ 4,429,215
=========== =============
SUPPLEMENTAL DISCLOSURE TO STATEMENTS OF CASH FLOWS:
Cash interest paid $ 6,060 $ 1,100
</TABLE>
The accompanying notes are an integral part of these financial
statements.
5
<PAGE>
<PAGE>
AMERICAN CRAFT BREWING INTERNATIONAL LIMITED AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(Amounts expressed in United States Dollars)
(Unaudited)
1. Basis for Preparation of the Consolidated Financial Statements
The consolidated financial statements have been prepared by American
Craft Brewing International Limited ("AmBrew International") and its
subsidiaries (collectively, the "Company"), without audit. The financial
statements include consolidated balance sheets, consolidated statements of
operations and consolidated statements of cash flows. In the opinion of
management, all adjustments, which consist of normal recurring adjustments,
necessary to present fairly the financial position, results of operations
and cash flows for all periods have been made.
These financial statements should be read in conjunction with the
consolidated financial statements as of and for the fiscal year ended October
31, 1997, and the footnotes thereto included in the Company's Annual Report on
Form 10-K (the "Form 10-K").
As discussed in Management's Discussion and Analysis of Financial
Condition and Results of Operations, the Company is actively seeking additional
sources of working capital in both the debt and equity markets. The successful
completion of additional financing may enable the Company to meet its
obligations including (1) the repayment of short-term loans and shareholders'
loans, (2) continued expansion of production facilities necessary to achieve
profitable production levels, and (3) additional marketing of certain brands
under distribution agreements with the Company, as more fully described below.
The Company believes that sources of working capital are available. There can be
no assurance, however, that the Company will obtain additional sources of
working capital or that any additional working capital secured will be
sufficient to provide the Company with the necessary capital to continue as a
going concern.
2. Basis of Presentation
The consolidated financial statements include the accounts of AmBrew
International and its majority-owned subsidiaries. All significant intercompany
accounts and transactions have been eliminated.
3. Sale of South China and SCBC
On December 22, 1997, the Company sold all of the issued and outstanding
shares of capital stock of the South China Brewing Company Limited ("South
China") and SCBC Distribution Company Limited ("SCBC") to Gold Crown Management
Limited ("Gold Crown"), an unrelated party. The Company also assigned to Gold
Crown loans from the Company to South China and SCBC collectively in the amount
of $1,719,844 (the "Sale and Assignment"). The net consideration that will be
paid to the Company in connection with the Sale and Assignment will be
approximately $700,000, which includes $200,000 placed in escrow to be
released upon the completion of certain equipment shipments and other events.
The Company recognized a loss of $63,919 associated with equipment purchases
and freight charges required under the terms of the sales contract. Currently,
$100,000 remains in escrow. In addition, the Company issued two options to
Gold Crown, as more fully described below.
In connection with the Sale and Assignment, the Company and Gold Crown
entered into two option agreements. The first option allows Gold Crown, at its
election, to exchange 30% of the issued and outstanding shares of capital stock
of South China and SCBC for an aggregate of 125,000 shares of the common stock
of the Company. The option is exercisable by Gold Crown during the period
commencing May 31, 1998 through November 30, 2002 or such later date as the
Company, in its sole discretion, shall determine. The Company's obligations to
deliver the shares upon Gold Crown's exercise of the first option is subject to
certain conditions specified in the option agreement including, among others,
minimum net assets at South China of $700,000.
6
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<PAGE>
AMERICAN CRAFT BREWING INTERNATIONAL LIMITED AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(AMOUNTS EXPRESSED IN UNITED STATES DOLLARS)
The value assigned for this option was approximately $50,000. The second option
allows Gold Crown to exchange 100% of the issued and outstanding shares of
capital stock of South China and SCBC for a certain number of shares as
calculated based on the terms of the second option agreement. Gold Crown may
exercise the second option only if the government of Hong Kong fails to
unconditionally renew South China's license to operate a brewery and the Company
has not cured such non-renewal within 45 days of the date on which Gold Crown
notifies the Company of such non-renewal. Management of the Company estimates
that the likelihood of such non-renewal is remote and has assigned no value to
the second option.
In connection with the sale of South China and SCBC, the Company signed
cross distribution agreements, which granted AmBrew USA the right to distribute
certain South China Brewery products in the United States and certain
territories. Additionally, the Company granted South China Brewery distribution
rights to certain of the Company's brands for Hong Kong and the People's
Republic of China. The distribution agreements expire in December 2001.
4. Net Loss per Common Share
Net loss per common share is computed by dividing net loss by the
weighted average common shares outstanding during the periods, on the basis that
the Share Exchange, the Share Split and the Merger (as defined in the Form 10-K)
had been consummated prior to the periods presented. Dilutive net loss per
common share including equivalent shares for common stock warrants and options
have not been included, as the computation would not be dilutive.
5. Inventories
Inventories are composed of the following:
<TABLE>
<CAPTION>
January 31, October 31,
1998 1997
------------- --------------
<S> <C> <C>
Raw materials $ 155,202 $ 255,281
Work-in-process and finished goods 153,686 140,199
--------- ---------
$ 308,888 $ 395,480
========= =========
6. Warrant conversion
On September 24, 1997 Cerveceria Rio Bravo signed a $300,000 short-term loan
agreement with Internacional de Mexico. The loan was evidenced by a promissory
note from Cerveceria Rio Bravo in the amount of $300,000 with an interest rate
of 12% per annum and was payable on or before November 23, 1997. In connection
with the loan the Company issued 100,000 warrants for common stock with an
exercise price of $0.50 per share. The note was repaid on November 18, 1997.
Concurrent with the payment of the note, the warrant holder exercised the
warrants in full and converted $50,000 into 100,000 shares of common stock.
7. Subsequent Events
Subsequent to January 31, 1998, the following events took place:
a. On March 4, 1998 The Company signed a short-term loan agreement,
in the amount of $50,000, with Equity Services Ltd. The note
bears interest at 12% per annum and is due on April 4, 1998.
7
<PAGE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
GENERAL
The following discussion addresses the Company's consolidated financial
condition and results of operations as of and for the three months ended January
31, 1998, which includes the operations of AmBrew International, AmBrew USA,
Cerveceria Rio Bravo, S.A. de C.V. ("Cerveceria Rio Bravo"), and Celtic Brew,
LLC ("Celtic Brew"). The consolidated information as of and for the three month
period ended January 31, 1997 also includes South China and SCBC. In addition,
the period-to-period presentation set forth under "Results of Operations" will
not necessarily be indicative of future results. Future net losses can be
expected as increased expenses are incurred in connection with the start up
phase of the expansion breweries that the Company has established and operates.
With the exception of historical information, the matters discussed
herein are "forward looking statements" within the meaning of the Private
Litigation Reform Act of 1995. Such forward looking statements are subject to
risks, uncertainties and other factors which could differ materially from future
results implied by such forward looking statements. Potential risks and
uncertainties include, but are not limited to, the Company's ability to operate
the existing breweries on a profitable basis, increased acceptance by consumers
of the Company's brands and development by the Company of new brands of beer,
the addition of new products to its distribution portfolio and the Company's
ability to obtain additional financing for its operations and working capital
requirements.
RESULTS OF OPERATIONS
Sales. For the three months ended January 31, 1998 and 1997 the Company
had net sales of $514,797 and $174,564, respectively, which represents an
increase in sales of $340,233. The increase in net sales for the three month
period ended January 31, 1998 is primarily attributed to AmBrew USA.
For the three month period ended January 31, 1998 AmBrew USA has sales
of $376,660 or 73% of net sales. The sales of Dixie Brewing Company ("Dixie")
products accounted for $315,154, or 61% of net sales. Additionally, the recent
accretion of KALIK Beer to the distribution portfolio of AmBrew USA had a
positive impact on net sales. For the period ended January 31, 1998 the sale of
KALIK beer accounted for $19,010 or approximately 4% of net sales. For the
period ended January 31, 1998 AmBrew USA had an increase in sales of
approximately 248% or $268,430, compared to the same period during 1997.
During the quarter ended January 31, 1998 aggregate sales of Celtic Brew
were $8,392. The sales of Celtic Brew accounted for approximately 2% of the
Company's net sales for the quarter. Celtic Brew continued to experience the
normal delays and start-up issues associated with any new venture. Subsequent to
the end of the quarter, Celtic Brew has resolved these issues, and has
completed delivery of its proprietary brand- Finian's's Irish Red Ale and its
custom brew product- Independence Lager to certain customers. It is anticipated
that AmBrew USA will import into the United States products from Celtic Brew
during the first half of calendar 1998.
Cerveceria Rio Bravo, which began operations late in fiscal 1997, has
sales of $99,581 or 19% of net sales for the period ended January 31, 1998.
Sales at Cerveceria Rio Bravo were much lower than expected due to its need for
working capital. Cerveceria Rio Bravo will require an infusion of working
capital in order to resume normal production levels.
Cost of Sales. Cost of sales increased as a percentage of sales to 91%
for the three months ended January 31, 1998 from 64% in the corresponding period
in 1997. The increase is primarily the result of the low levels of production at
the brewing facilities and the operations of AmBrew USA. AmBrew USA's cost of
sales is higher than that of the breweries, as it functions solely as a
distributor. AmBrew USA's cost of sales for the three months ended January 31,
1998 was $315,783 or 84% of its sales.
The Cerveceria Rio Bravo's cost of sales for the three months ended
January 31, 1998 was 123% of its sales or $122,336. The high cost of sales three
months ended January 31, 1998 is a direct result of its underutilized capacity.
The underutilized capacity was a primarily attributed to the shortage of working
capital.
8
<PAGE>
<PAGE>
Cost of sales for Celtic Brew was 68% of sales or $5,747 for the three
months ended January 31, 1998. Celtic Brew also functioned at a low level of
capacity not only because of its need for working capital, but also due to
certain start up issues.
Selling, General and Administrative Expenses. Selling, general and
administrative expenses for the three months ended January 31, 1998 and 1997
were $1,122,118 and $380,625, respectively. For the three months ended January
31, 1998 AmBrew International, had expenses of $735,480 or an increase of 271%
compared to the same period in 1997. These expenses include legal and
professional fees of $237,621 or 21% of total selling, general and
administrative expense for the period. Additionally, the Company incurred loan
origination fees of $108,000 or approximately 10% of the total expense. The
Company also experienced a recurring non-cash Directors and Officers insurance
expense relating to its prospectus of approximately $10,980. The Company
continued to experience the high general and administrative expenses associated
with being a publicly traded company. Such expenses include, but are not limited
to salaries, director's fees, legal fees, audit fees and the preparation of
required quarterly and annual reports.
For the three month period ended January 31, 1998 and 1997 AmBrew USA
had expenses of $179,294 and $29,167, respectively. For the period ended January
31, 1998 AmBrew USA experienced an increase in selling general and
administrative expenses of 515% or $150,127 compared to the same period in 1997.
AmBrew USA's selling, general and administrative expense includes a material
reserve for certain assets. The addition of field salespersons also added to the
increase in the expense for the period ended January 31, 1998 compared to the
same period in 1997.
Cerveceria Rio Bravo had selling, general and administrative expenses of
$179,261, which included depreciation on leasehold improvements of $25,709.
Celtic Brew had selling general and administrative expenses of $51,455 for the
period ended January 31, 1998.
Non-operating expenses-During this reporting period the Company
recognized a number of expenses that are not related to operations. These
expenses include, but are not limited to: 1) loan origination fees for the EIL
debt $62,640; 2) legal fees associated with loans $95,071; 3) commission fees
associated with the EIL loan $18,000; and 4) legal fees associated with the
Regulation D issue $98,000. The total amount reported as non-operating expenses
totaled $273,711 for the period ended January 31, 1998.
Loss on sale of subsidiary - The Company experienced a book loss on the
sale of South China totaling $63,919, which is presented as a separate line
item. The sale of South China and SCBC is more fully described in Note 3.
With the exclusion of the above non-operating expenses the results of
the ongoing operations are enhanced and expected to improve once higher levels
of utilization and production are achieved.
Net Interest (Income) Expense. Net interest (income) expense for the
three months ended January 31, 1998 and 1997 was $25,245 and ($11,929),
respectively. The expense for the period ended January 31, 1998 relates to
interest incurred on short term financing, while the interest income from the
corresponding period in 1997 relates the investment of idle proceeds from the
initial stock offering.
LIQUIDITY AND CAPITAL RESOURCES
As of January 31, 1998, the Company had a working capital deficit of
$1.8 million, which includes $954,712, in short term loans and $100,000 in
shareholders' loans. Additionally, the Company has incurred losses in each year
since inception and anticipates it will continue to do so in fiscal 1998 as
capacity is increased at its production facilities and production has not yet
reached levels sufficient to achieve profitability.
On November 14, 1997 the Company signed a loan agreement with
Entrepreneurial Investors, Ltd. ("Entrepreneurial Investors"). The short-term
loan is evidenced by a senior note in the amount of $900,000 that bears an
interest rate of 10% per annum and is payable on March 31, 1998. The senior note
to Entrepreneurial Investors is collateralized by a pledge of the Company's
interest in its subsidiaries. A portion of the proceeds from the
9
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<PAGE>
Entrepreneurial Investors loan was used to pay the October 27, 1997 loan from
Equity Services. Additionally, the Company used a portion of the proceeds to pay
the outstanding promissory notes. The remaining funds from the loan were used to
fund the Company's working capital needs.
On December 22, 1997, the Company sold its interest in South China and
SCBC for $650,000, of which $200,000 was placed in escrow pending the
outcome of certain events, as more fully described in Note 3, $100,000
remains in escrow. The proceeds received at that date were used for additional
equipment and working capital needs.
The Company's projections indicate that it needs approximately $1.9
million to fund operations through the middle of calendar 1998, at which time
the Company projects it will achieve positive cash flow. In order for the
Company to continue its operations and to address the current cash position and
the need for working capital, the Company is pursuing both immediate and
long-term financial assistance in both the debt and equity markets.
Specifically, the Company is 1) currently having discussions with domestic and
foreign banks for debt financing, 2) utilizing the resources of its individual
members of its Board of Directors and shareholders, 3) having discussions with
investors about both debt and equity investments, 4) looking for joint venture
partners for Cerveceria Rio Bravo to purchase from the Company a partial
interest in that facility and 5) having discussion regarding converting debt to
equity. There can be no assurance that such debt financing or capital will be
available or, if available, under terms and conditions acceptable to the
Company. The Company's inability to obtain additional capital would result in a
material adverse effect on the Company's ability to pay creditors on a timely
basis or meet its various commitments related to operations and its ability to
operate as a going concern.
In addition to the liquidity constraints noted above, the Company has
capital requirements for its continued expansion of certain of its production
facilities in order to achieve profitable production levels. Also, the Company
has capital requirements necessary to adequately market and promote certain
products and brands under distribution agreements, including, but not limited
to, the Dixie Agreement. Under the terms of the Dixie distribution agreement,
AmBrew USA has minimum purchase commitments of $2,482,350, $2,717,000, and
$1,420,272 for the years ending October 31, 1998, 1999 and 2000, respectively.
In addition the Company expects to spend approximately $125,000 for the
marketing materials during the year ended October 31, 1998.
The successful completion of additional financing may enable the Company
to meet its obligations including (1) the repayment of short-term loans and
shareholders' loans, (2) continued expansion of production facilities necessary
to achieve profitable production levels, and (3) additional marketing of certain
brands under distribution agreements with the Company, as more fully described
above. The Company believes that sources of working capital are available. There
can be no assurance, however, that the Company will obtain additional sources of
working capital or that any additional working capital secured will be
sufficient to provide the Company with the necessary capital to continue as a
going concern.
Longer term liquidity is dependent on the Company's achievement of
sufficient production levels to sustain profitability and continued access to
capital markets, including its ability to issue additional debt and equity
securities, which in certain cases may require the consent of the existing
shareholders.
At January 31, 1998, AmBrew International had an operating lease
obligation of $183,304 over the period ending June 14, 2002 relating to the
lease of its corporate office. AmBrew International also had operating lease
obligations of $33,611 for the period ending February 28, 2000 relating to
company vehicles. Additionally, the Company has fixed annual salary expenses of
$392,000 related to various employment agreements with its employees.
At January 31, 1998, Cerveceria Rio Bravo had obligations of $308,250
for the period ending September 10, 2001 in connection with a related party
operating lease for its brewery site.
At January 31, 1998, Celtic Brew had obligations of $48,504 for the
period ending February 30, 2002 in connection with a related party operating
lease for its brewery site.
At January 31, 1998, no proceeds from the initial public offering
remained. To date the Company has $100,000 in outstanding promissory notes to
shareholders.
10
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<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
27.0 - Financial Data Schedule.*
*filed herewith
(b) Reports on Form 8-K.
During the quarter ended January 31, 1998, the Company filed a report on
Form 8-K dated November 11, 1997 reporting an event under Item 5 of Form
8-K.
During the quarter ended January 31, 1998 the Company filed a report on
Form 8-K dated December 22, 1997 reporting an event under Item 2 of Form
8-K.
11
<PAGE>
<PAGE>
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.
AMERICAN CRAFT BREWING
INTERNATIONAL LIMITED
Date: March 17, 1998 /s/ James L. Ake
------------------------
James L. Ake
Executive Vice President,
Chief Operating Officer
and Secretary
/s/ Nancy R. Hernandez
------------------------
Nancy R. Hernandez
Controller
12
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<PAGE>
INDEX TO EXHIBITS
NUMBER EXHIBIT
27.0 Financial Data Schedule...............................................
13
<PAGE>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-1997
<PERIOD-END> JAN-31-1998
<CASH> 14,745
<SECURITIES> 0
<RECEIVABLES> 314,294
<ALLOWANCES> 0
<INVENTORY> 308,888
<CURRENT-ASSETS> 766,800
<PP&E> 2,652,931
<DEPRECIATION> 70,207
<TOTAL-ASSETS> 4,865,644
<CURRENT-LIABILITIES> 2,482,694
<BONDS> 0
0
0
<COMMON> 37,969
<OTHER-SE> 2,178,767
<TOTAL-LIABILITY-AND-EQUITY> 4,865,644
<SALES> 514,797
<TOTAL-REVENUES> 514,797
<CGS> 467,828
<TOTAL-COSTS> 1,262,375
<OTHER-EXPENSES> (1,349)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (25,245)
<INCOME-PRETAX> (1,019,628)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,019,628)
<DISCONTINUED> (63,919)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,083,547)
<EPS-PRIMARY> (0.29)
<EPS-DILUTED> 0
</TABLE>
