<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
(Mark One)
[x] Quarterly report under Section 13 or 15(d) of the Securities Exchange
Act of 1934 For the quarterly period ended September 30, 1999
[ ] Transition report under Section 13 or 15(d) of the Exchange Act
For the transition period from ---- to ----
Commission file number 001-12127
EMPIRE RESOURCES, INC.
(Exact Name of Small Business Issuer as Specified in Its Charter)
Delaware 22-3136782
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
One Parker Plaza
Fort Lee, NJ 07024
(Address of Principal Executive Offices)
201 944-2200
(Issuer's Telephone Number, Including Area Code)
INTEGRATED TECHNOLOGY USA, INC.
(Former Name)
Check 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.
Yes [X] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: 15,524,162 shares of
common stock outstanding as of September 30, 1999.
Transitional Small Business Disclosure Format (check one):
Yes [ ] No [X]
<PAGE>
EMPIRE RESOURCES, INC.
FORM 10-QSB FOR THE QUARTER ENDED SEPTEMBER 30, 1999
INDEX
Page
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
Condensed Consolidated Balance Sheets as of December 31, 1998 and
September 30, 1999 (unaudited)..................................... 3
Condensed Consolidated Statements of Operations for the Three
and Nine Months Ended September 30, 1998 and 1999 (unaudited)...... 4
Condensed Consolidated Statements of Cash Flows for the Nine
Months Ended September 30, 1998 and 1999 (unaudited)............... 5
Notes to Condensed Consolidated Financial Statements(unaudited).... 6
Item 2 Management's Discussion and Analysis of Financial Condition
and Results of Operations.......................................... 8
PART II OTHER INFORMATION
Item 4 Submission of Matters to a Vote of Security Holders................ 11
Item 6 Exhibits and Reports on Form 8-K................................... 12
Signatures......................................................... 13
2
<PAGE>
Empire Resources, Inc.
Part I
Condensed Consolidated Balance Sheets
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
December 31, September 30,
1998 1999
(Unaudited)
<S> <C> <C>
Assets
Cash and cash equivalents $147,719 $1,553,094
Trade accounts receivable, net 20,438,800 24,928,486
Inventories 14,005,173 18,703,411
Other current assets 147,764 412,322
--------------------- --------------------
Total current assets 34,739,456 45,597,313
Deferred financing costs, net -- 50,329
Furniture and equipment 283,365 305,251
Less: accumulated depreciation (200,596) (229,676)
-------------------- --------------------
Net furniture and equipment 82,769 75,575
Loans due from employees and third party 165,000 --
-------------------- ------------------
Total assets $34,987,225 $45,723,217
=========== ==========
Liabilities and Stockholders' Equity
Notes payable -- banks $15,900,000 $23,900,000
Notes payable to former stockholders -- 152,898
Trade accounts payable 7,834,845 10,180,439
Accrued expenses 528,600 1,473,369
Distributions payable to former stockholders -- 96,482
------------------- -------------------
Total current liabilities 24,263,445 35,803,188
------------------- -------------------
Commitments
Stockholders equity:
Common stock 50,000 155,242
1998-no par value; 200 shares authorized;
10 shares issued and outstanding
1999-$.01 par value; 40,000,000 shares authorized;
15,524,162 shares issued and outstanding
Additional paid in capital -- 9,844,758
Cumulative translation adjustment -- 37,460
Retained earnings (deficit) 10,673,780 (67,431)
Treasury stock -- (50,000)
------------------- ------------------
Total stockholders' equity 10,723,780 9,920,029
------------------ -------------------
Total liabilities and stockholders' equity $34,987,225 $45,723,217
================== ===================
</TABLE>
The accompanying notes are an integral part of these condensed
consolidated financial statements.
3
<PAGE>
Empire Resources, Inc.
Condensed Consolidated Statements of Operations (Unaudited)
- -------------------------------------------------------------------------------
<TABLE>
Three months ended Nine months ended
September 30, September 30,
1998 1999 1998 1999
<S> <C> <C> <C> <C>
Net sales $24,310,261 $32,887,222 $76,754,561 $79,172,162
CCost of goods sold 22,271,327 30,372,855 71,171,639 73,297,199
------------------- ----------------- ----------------- ----------------
Gross profit 2,038,934 2,514,367 5,582,922 5,874,963
Selling, general and administrative expenses 729,376 816,163 2,177,959 2,304,283
------------------- ----------------- ----------------- ----------------
Operating income 1,309,558 1,698,204 3,404,963 3,570,680
Interest expense 310,813 701,668 1,007,573 1,678,914
------------------ ------------------ ----------------- ----------------
Income before income taxes 998,745 996,536 2,397,390 1,891,766
Income taxes 40 59,125 1,183 72,535
------------------- ----------------- ----------------- ----------------
Net income $998,705 $937,411 $2,396,207 $1,819,231
=================== ================= ================= ================
Earnings per share -- basic $0.18 $0.15 $0.43 $0.31
Earnings per share -- diluted $0.18 $0.15 $0.43 $0.31
Weighted average shares outstanding -- basic 5,560,250 6,427,774 5,560,250 5,852,602
Weighted average shares outstanding -- diluted 5,560,250 6,464,743 5,560,250 5,865,061
Pro forma income taxes $379,523 $378,684 $911,008 $718,871
Pro forma net income $619,222 $617,852 $1,486,382 $1,172,895
Pro forma earnings per share-basic $0.11 $0.10 $0.27 $0.20
diluted $0.11 $0.10 $0.27 $0.20
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
4
<PAGE>
Empire Resources, Inc.
- -------------------------------------------------------------------------------
Consolidated Statements of Cash Flows (Unaudited)
<TABLE>
Nine months ended September 30,
1998 1999
<S> <C> <C>
Cash flows from operating activities
Net income $2,396,207 $1,819,231
Adjustments to reconcile net income to net cash
provided by (used in) operating activities
Depreciation and amortization 31,332 37,213
Decrease (increase) in accounts receivable 4,542,803 (4,489,686)
Decrease (increase) in inventories 12,916,978 (4,093,092)
Increase in other assets (259,420) (704,703)
(Decrease) increase in trade accounts payable (15,000,325) 2,345,595
(Decrease) Increase in accrued expenses (56,711) 991,484
------------------ ------------------
Net cash provided by (used in) operating activities 4,570,864 (4,093,960)
------------------ -------------------
Cash flows from investing activities:
Additions to fixed assets (61,250) (21,886)
------------------- ------------------
Net cash used in investing activities (61,250) (21,886)
-------------------- ------------------
Cash flows from financing activities:
(Repayments of) proceeds from notes payable-banks (1,825,000) 8,000,000
Distributions to stockholders (2,820,000) (11,801,059)
Cash acquired upon merger -- 9,950,000
Payment of merger costs -- (569,258)
Increase in deferred financing costs -- (58,462)
------------------- -------------------
Net cash (used in) provided by financing activities (4,645,000) 5,521,221
------------------- --------------------
Net (decrease) increase in cash and cash equivalents (135,386) 1,405,375
Cash at beginning of period 562,439 147,719
------------------- -------------------
Cash at the end of period $427,053 $1,553,094
=================== ===================
Supplemental disclosures of cash information
Cash paid during the period for:
Interest $1,007,573 $1,605,809
=================== ===================
Income Taxes -- $32,500
=================== ===================
Non-cash financing activity
Notes payable to former stockholders- distribution -- $152,898
=================== ===================
</TABLE>
The accompanying notes are an integral part of these condensed consolidated
financial statements.
5
<PAGE>
Empire Resources, Inc.
Notes to Condensed Consolidated Financial Statements (Unaudited)
- -------------------------------------------------------------------------------
1. Organization and Basis of presentation
Empire Resources, Inc. (formerly known as Integrated Technology USA,
Inc.) (the "Company") was incorporated in 1990 to design, develop and
market products for emerging computer related markets. Since
inception, the Company had generated limited revenues from the sale of
its computer related products. On November 6, 1997, the Company
announced its decision to discontinue its existing operations in their
entirety by December 31, 1997. The Company sought a merger/acquisition
opportunity that would enable it to deploy its cash into a new
operating business.
On February 22, 1999, the Company signed a merger agreement with
Empire Resources, Inc. ("Empire"), a distributor of value added,
semi-finished aluminum products. Under the terms of the Agreement and
Plan of Merger, and effective September 17, 1999, Empire was merged
with and into the Company, and the Company issued to the then current
shareholders of Empire 9,384,761 shares of common stock, of which
3,824,511 shares of common stock have been placed in escrow. Some or
all of the escrowed shares will be released to the former stockholders
of Empire based on a two-year earn-out formula. Any escrowed shares
not released to the former stockholders of Empire will be returned to
the treasury of the merged company or retired. Upon completion of the
merger, the Company changed its name to Empire Resources, Inc. The
merged company will continue the aluminum business of Empire.
For accounting and other financial reporting purposes, the merger has
been treated as a "reverse acquisition." Under this treatment, the
surviving corporation has been treated as a continuation of Empire,
and the merger has been treated as an issuance of shares by Empire to
the stockholders of Integrated in exchange for Integrated's cash.
Accordingly, the accompanying financial statements are the historical
financial statements of Empire and Empire Resources Pacific Ltd., and
include the results of operations of Integrated only from the
September 17, 1999 merger date.
Prior to the merger Empire Resources Pacific Ltd., an affiliate of
Empire Resources, Inc. operating in Australia became a wholly owned
subsidiary of Empire in a combination of companies under common
control, which was accounted for at historical cost in a manner
similar to that in a pooling of interests.
The condensed consolidated interim financial statements included
herein have been prepared by the Company, without audit, pursuant to
the rules and regulations of the Securities and Exchange Commission
with respect to Form 10-QSB. Certain information and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting
6
<PAGE>
principles have been omitted pursuant to such rules and regulations.
In the opinion of management, such financial statements reflect all
adjustments necessary for a fair presentation of the results for the
interim periods presented and to make such financial statements not
misleading. It is suggested that these interim financial statements be
read in conjunction with the consolidated financial statements and the
notes thereto included in the Company's Proxy statement dated August
6, 1999.
2. Use of estimates
The preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amount of assets and
liabilities at the date of the financial statements and the reported
amount of income and expenses during the reported period. Actual
results could differ from these estimates.
3. Income Taxes and Pro Forma Income Taxes
Empire had elected S corporation status for federal income tax
purposes, and accordingly was not subject to federal tax on its income
for periods prior to the September 17, 1999 merger with Integrated
Technology USA, Inc. Income tax expense for periods prior to the
merger date represents state and local taxes. Income tax expense for
the three and nine month periods ended September 30, 1999 includes
provisions for taxes on a C corporation basis on income earned from
September 17, 1999.
Pro forma income tax expense represents the provision for income taxes
as if Empire had been a C corporation for all periods presented.
4. Earnings Per Share
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
1998 1999 1998 1999
---- ---- ----- ----
<S> <C> <C> <C> <C>
weighted average shares
outstanding - basic 5,560,250 6,427,774 5,560,250 5,852,602
dilutive effect of stock
options and warrants 36,969 12,459
weighted average shares
outstanding - diluted 5,560,250 6,464,743 5,560,250 5,865,061
</TABLE>
Basic earnings per share and pro forma basic earnings per share are
based upon the weighted average number of common shares outstanding
during each period. The shares issued to the former Empire Resources
shareholders in the merger, excluding the 3,824,511
7
<PAGE>
contingent shares which were placed in escrow, were considered
outstanding for all periods presented. The shares of the former
Integrated Technology shareholders were considered outstanding only
from the September 17, 1999 merger date.
Diluted earnings per share and pro forma diluted earnings per share
are based upon the weighted average number of common shares
outstanding during each period, assuming the issuance of common shares
for all dilutive potential common shares outstanding during the period.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
General
Empire is a distributor of value added, semi-finished aluminum products.
Consequently, Empire's sales volume has been, and will continue to be, a
function of its ongoing ability to secure quality aluminum products from its
suppliers. During the fourth quarter of 1999 one of the Company's suppliers
signed an agreement with Alcoa to sell a majority interest in the supplier. In
the past, such agreements have had the effect of terminating Empire's ability to
purchase material from that supplier after the transaction has been completed.
The Company has already taken steps to replace this volume from both existing
and new vendors. Empire expects that it will further expand its supply sources
later in 2000 when an existing supplier, with whom Empire enjoys an exclusive,
long-term relationship, is scheduled to expand production at a new facility.
The merger between Integrated and Empire was completed on September 17, 1999.
For accounting and other financial reporting purposes, the merger has been
treated as a "reverse acquisition." Under this treatment, the surviving
corporation has been treated as a continuation of Empire, and the merger has
been treated as an issuance of shares by Empire to the stockholders of
Integrated in exchange for Integrated's cash. Accordingly, the accompanying
financial statements are the historical financial statements of Empire and
Empire Resources Pacific Ltd., and include the results of operations of
Integrated only from the September 17, 1999 merger date. Prior to the merger
Empire Resources Pacific became a wholly owned subsidiary of Empire in a
combination of companies under common control, which was accounted for at
historical cost in a manner similar to that in a pooling of interests.
Tax Status
Prior to the merger, Empire Resources has been taxed as an S corporation for
Federal income tax purposes. In general, the income or loss of an S corporation
is passed through to its owners rather than being subject to tax at the entity
level. Prior to the merger Integrated was a C corporation and post merger the
Company is taxed as a C corporation.
8
<PAGE>
Results of Operations--the Three and Nine months ended September 30, 1998 and
1999.
Net sales increased $8.6 million or 35% from $24.3 million in the third quarter
of 1998 to $32.9 million in the third quarter of 1999 and increased by $2.4
million for the nine month period. Empire's main constraint is the amount of
product its suppliers have available for sale. The increase in sales in the
third quarter represents an increase in the mills availability for export during
this quarter. This increase in shipments came from existing supply
relationships. Gross profit increased 23% in the third quarter of 1999 over the
third quarter of 1998 and 5% for the nine months of 1999 over the nine months of
1998, due to the increase of sales. Selling, General and Administrative expenses
increased from $0.7 million to $0.8 million for the three month period of
September 1998 and 1999 respectively, and from $2.2 million for the nine months
of September 1998 to $2.3 million for the nine months of September 1999. This
increase is primarily due to changes in salaries and new personnel hired to
improve customer services.
Interest expense increased from $0.3 during the third quarter of 1998 to $0.7
million during the third quarter of 1999, and from $1.0 million to $1.7 million
for the nine months ending September 30, 1998 and 1999 respectively. The
increase in interest expense during the third quarter is primarily a result of
the issuance of promissory notes to stockholders, as described under
- -"Distribution of Surplus Net Worth--Distribution of Promissory Notes" below.
Distribution of Surplus Net Worth
In February 1999, Empire determined to distribute to the former Empire
stockholders an amount ("Surplus Net Worth") equal to 60% of the
pre-distribution total fair value of Empire's business and net assets inclusive
of good will and going concern value, and in particular the full premium value
of Empire's supply contracts (which total value Empire and the former Empire
stockholders agreed was not less than $19 million), but in no event more than
the total stockholders' equity of Empire as shown on the balance sheet of
Empire as of December 31, 1998 (or $10,922,475). Empire carried out the
foregoing through the distribution to the Empire Stockholders of the Asset
Backed Notes described under "--Distribution of Promissory Notes" below.
Empire also determined to recalculate its Surplus Net Worth as of the effective
time of the merger (with Empire's Surplus Net Worth equaling for such purpose
the total stockholders' equity of Empire as shown on its balance sheet as of
the Effective Time), and to make additional distributions (described under
"--Possible Additional Distributions" below) to the former Empire stockholders
to reduce such Surplus Net Worth to approximately zero. As a consequence of the
foregoing, Empire has made certain distributions to the former Empire
stockholders as described below.
Distribution of Promissory Notes
On February 19, 1999, Empire distributed to the Empire stockholders two
promissory notes (the "Asset Backed Notes") in the aggregate principal amount
of $10,922,475. The Asset Backed Notes: (1) bore interest at the rate of 6% per
annum, (2)were due and payable in full on September 30, 1999 (as extended from
June 30, 1999), and (3) were secured by all accounts receivable and inventory
of Empire that were in existence on the date the notes were issued and by any
proceeds received in respect of such collateral. Empire was required to deposit
any proceeds constituting collateral into a segregated collateral account. The
funds in this account were used to repay the Asset Backed Notes at maturity.
Because Empire had been segregating funds in a collateral account as described
above, Empire had been required to increase its borrowings under its credit
facility in order to fund its working capital requirements.
Prior to completion of the merger, Empire made such additional distributions to
the former Empire stockholders as was necessary to reduce Empire's Surplus Net
Worth, measured as of the effective time of the merger, to approximately zero.
Such distributions were in the form of cash or notes.
9
<PAGE>
Accounting Treatment of Restricted Stock Agreement
The Company and Nathan and Sandra Kahn, the former stockholders of Empire,
entered into a restricted stock agreement with Mr. Harvey Wrubel. Mr. Wrubel
is currently an employee of Empire and is Vice President of Sales of the
surviving corporation. Pursuant to the restricted stock agreement, the Kahns
have transferred to Mr. Wrubel 469,238 shares ("Restricted Shares") of common
stock of the surviving corporation, which represents a portion of the shares
that were received by the Kahns in the merger. The Restricted Shares are
comprised of (i) 358,327 shares (the "Non-Contingent Restricted Shares") that
will vest on specified dates over a three-year period, subject only to the
condition that Mr. Wrubel continue to be employed by the surviving corporation
as of the vesting date, and (ii) 110,911 shares (the "Contingent Restricted
Shares") that will be subject to the same vesting criteria as the
Non-Contingent Restricted Shares and, in addition, be subject to the condition
that the number of shares (if any) that will vest will be a function of the
after-tax net income of the surviving corporation over a specified period.
The transfer of the Restricted Shares from the Kahns to Mr. Wrubel did not
involve the issuance of any shares by the surviving corporation or any cash
expenditure by the surviving corporation. However, under applicable accounting
rules, such transfer will be treated the same as if the surviving corporation
had issued such shares to Mr. Wrubel as compensation for services and,
accordingly, the surviving corporation is required to recognize an expense
relating thereto. The expense relating to the Non-Contingent Restricted Shares
will be based on the fair market value of the stock as of the grant date and be
recognized over the vesting period. The expense relating to the Contingent
Restricted Shares will be based on the fair market value of the stock as of the
time of vesting and be recognized at the time of vesting. No expense will be
recognized with respect to Contingent Restricted Shares that do not vest.
Liquidity and Capital Resources
Empire currently operates under a revolving line of credit, including a
commitment to issue letters of credit, with two commercial banks. The available
line is $35 million as of September 30, 1999. Borrowings under these lines of
credit are collateralized by security interests in substantially all of
Empire's assets. Under these credit agreements, Empire is required to maintain
working capital and net worth ratios. These facilities expire on June 30, 2001.
As of September 30, 1999, the amount outstanding under Empires' revolving lines
of credit was $23.9 million (excluding letters of credit in the amount of $7.1
million). Management believes that cash from operations, together with funds
available under its credit facility, will be sufficient to fund the cash
requirements relating to Empire's existing operations for the next twelve
months. Empire may require additional debt or equity financing in connection
with the future expansion of its operations.
Commitments and Contingencies
Empire has contingent liabilities in the form of letters of credit to some of
its suppliers. As of September 30, 1999, Empire's outstanding letters of credit
amounted to $7.1 million. Under the terms of some of its supply contracts,
Empire is required to take minimum tonnages as specified in those contracts. As
a result, Empire could, under certain circumstances, be forced to sell the
required tonnage at a loss.
10
<PAGE>
Year 2000 Issues
Some computer software programs and computer hardware and computer chips
embedded in operating systems may not correctly recognize dates beginning on
and after January 1, 2000. This could result in those programs, hardware or
systems becoming inoperable or experiencing other adverse consequences. Empire
has reviewed its internal computer software programs and hardware and believes
that they are year 2000 compliant. Empire's costs in connection with this
review and making its software and hardware year 2000 compliant have not been
and are not expected to be material. Empire has sought assurances from its
suppliers, shippers and customers that their operations are year 2000
compliant, and has received assurances from many of them. However, Empire has
no control over their compliance efforts. Furthermore, most of Empire's
suppliers are located in foreign countries in which companies may not be as
advanced in achieving year 2000 compliance as companies in the United States.
There can be no assurance that year 2000 problems at Empire's suppliers or
shippers will not interfere with Empire's ability to obtain supplies in a
timely manner, if at all. Any such occurrence would have a material adverse
effect on Empire's business. Furthermore, year 2000 problems may have a
negative impact on the general economy or on the ability of businesses
generally to receive essential services (such as telecommunications, banking
services, etc.).
Forward Looking Statements
This report contains certain forward looking statements reflecting management's
current views with respect to future events and financial performance. These
forward looking statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from those in the forward
looking statements, all of which are difficult to predict and many of which are
beyond the control of the Company.
PART II
Item 4. Submission of Matters to a Vote of Security Holders.
The annual meeting of stockholders of Integrated Technology USA, Inc.
("Integrated") was held on September 15, 1999. At the annual meeting, the
stockholders voted to approve and adopt the Agreement and Plan of Merger dated
as of February 22,1999 (the "Merger Agreement"), among Integrated, Empire
Resources, Inc., a Delaware corporation ("Empire"), Empire Resources Pacific
Ltd., a Delaware corporation ("Empire-Pacific"), and the stockholders of Empire
and Empire-Pacific. The Merger Agreement provided for, among other things, that
(i) Integrated would merge with Empire and (ii) the certificate of
incorporation of the surviving corporation would be amended to change the name
of the surviving corporation to "Empire Resources, Inc."
At the meeting, the stockholders also voted to elect directors to the board of
directors of Empire. In addition, Integrated solicited the votes of
stockholders to ratify the appointment of KPMG LLP as independent auditors for
the fiscal year ending December 31, 1999. There was no vote on the ratification
of the appointment of KPMG LLP because as previously disclosed Richard A.
Eisner & Company LLP has replaced KPMG as independent auditors.
11
<PAGE>
Prior to the annual meeting, the directors of Integrated and certain
of their affiliates entered into agreements to vote the shares of Integrated
common stock owned or controlled by them in favor of approval of the Merger
Agreement. These directors and affiliates beneficially own an aggregate of
1,761,570 shares of Integrated common stock, which constitutes approximately
28.69% of the outstanding shares.
The following table sets forth the number of votes for, against or
withheld, as well as the number of abstentions and broker non-votes, as to each
matter voted upon at the annual meeting and each nominee to the board of
directors.
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
Votes Votes Broker Non-
Matter Votes For Against Withheld Votes Abstentions
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Merger Agreement 3,928,975 108,024 1,380,459 36,931
- -----------------------------------------------------------------------------------------------------------------
Election of:
- -----------------------------------------------------------------------------------------------------------------
Nathan Kahn 5,346,765 107,624
- -----------------------------------------------------------------------------------------------------------------
Sandra Kahn 5,346,765 107,624
- -----------------------------------------------------------------------------------------------------------------
Jack Bendheim 5,346,765 107,624
- -----------------------------------------------------------------------------------------------------------------
Barry W. Blank 5,346,765 107,624
- -----------------------------------------------------------------------------------------------------------------
Barry L. Eisenberg 5,346,765 107,624
- -----------------------------------------------------------------------------------------------------------------
Peter G. Howard 5,346,765 107,624
- -----------------------------------------------------------------------------------------------------------------
Nathan Mazurek 5,346,765 107,624
- -----------------------------------------------------------------------------------------------------------------
Morris J. Smith 5,346,765 107,624
- -----------------------------------------------------------------------------------------------------------------
William Spier 5,308,733 145,656
- -----------------------------------------------------------------------------------------------------------------
</TABLE>
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) The following exhibit is furnished with this report:
27.1 Financial Data Schedule
(b) In its report on Form 8-K dated September 24, 1999, the Company
reported that it had dismissed PricewaterhouseCoopers LLP as the
Company's certifying accountant. Attached to the Form 8-K as an
exhibit was a letter from PricewaterhouseCoopers LLP agreeing to the
statements made in the Form 8-K.
In its report on Form 8-K dated October 8, 1999, the Company reported
that it had appointed the firm of Richard A. Eisner & Company, LLP as
the Company's certifying accountant.
12
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Exchange Act of
1934, the registrant caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
EMPIRE RESOURCES, INC.
By: Sandra Kahn
-----------------------------
Sandra Kahn
Chief Financial Officer
(signing both on behalf of the registrant and in her capacity as Principal
Financial and Principal Accounting Officer)
Dated: November 15, 1999
13
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated financial statements and is qualified in its entirety by reference
to such consolidated financial statements and notes.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> SEP-30-1999
<CASH> 1,553,094
<SECURITIES> 0
<RECEIVABLES> 25,054,274
<ALLOWANCES> 125,788
<INVENTORY> 18,703,411
<CURRENT-ASSETS> 45,597,313
<PP&E> 305,251
<DEPRECIATION> 229,676
<TOTAL-ASSETS> 45,723,217
<CURRENT-LIABILITIES> 35,803,188
<BONDS> 0
0
0
<COMMON> 155,242
<OTHER-SE> 9,764,787
<TOTAL-LIABILITY-AND-EQUITY> 45,723,217
<SALES> 79,172,162
<TOTAL-REVENUES> 79,172,162
<CGS> 73,297,199
<TOTAL-COSTS> 73,297,199
<OTHER-EXPENSES> 2,304,283
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,678,914
<INCOME-PRETAX> 1,891,766
<INCOME-TAX> 72,535
<INCOME-CONTINUING> 1,819,231
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,819,231
<EPS-BASIC> $0.31
<EPS-DILUTED> $0.31
</TABLE>
