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: June 30, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER: 333-9809
HEALTH BUILDERS INTERNATIONAL, INC.
(Exact name of small business issuer as specified in its charter)
Delaware 87-0561634
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
2077 Elderberry Way, Sandy, Utah 84092
(Address of principal executive offices)
(801) 553-8972
(Issuer'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 issuer 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 June
30, 1998: 2,305,500
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
See attached.
Item 2: Management's Discussion & Analysis or Plan of Operations
The Company was incorporated on July 3, 1996. The Company
has not yet generated any significant revenues from operations and is
considered a development stage company. The Company has no
significant assets. To date, activities have been limited to
organizational matters and the preparation and filing of a
registration statement to register a public offering of its
securities. Pursuant thereto, the Company sold 305,500 shares of
its common stock and raised gross proceeds of $61,100.
Management's plan of operation for the next twelve months is
to use the proceeds from the offering primarily to acquire office
equipment, hire employees and cover the payroll costs and
otherwise provide operating capital during the start up period of
operations until the Company can begin generating revenues from
operations to thereafter cover ongoing expenses. The Company is
totally dependent upon the funds raised in this offering for the
ability to fully commence its intended business operations.
There is absolutely no assurance that the Company will be
able, with the proceeds of the offering, to successfully commence
proposed business operations. At this time, no assurances can be
given with respect to the or the length of time after
commencement of operations that it will be necessary to fund
operations from proceeds of the offering.
Management believes that the net proceeds from the offering
will provide working capital for one to two years after
commencement of operations, during which time management
anticipates that the Company will begin generating sufficient
revenues to cover ongoing expenses. However, there is absolutely
no assurance of this. If the Company is unsuccessful, investors
will have lost their money and management will not attempt to
pursue further efforts with respect to such business, 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.
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 statements) and Item 2
(management's discussion) for financial information and
a narrative 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
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Issuer has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Health Builders International, Inc.
Date: August 14, 1998 by: /s/ L. Dee Hall
L. Dee Hall, Secretary
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
UNAUDITED CONDENSED BALANCE SHEETS
ASSETS
June 30, December 31,
1998 1997
___________ ___________
CURRENT ASSETS:
Cash in bank $24,328 $ 17,076
Certificate of deposit -
held to maturity - 20,096
___________ ___________
Total Current Assets 24,328 37,172
___________ ___________
PROPERTY AND EQUIPMENT, net 625 368
___________ ___________
OTHER ASSETS:
Organizational costs, net 617 717
___________ ___________
Total Other Assets 617 717
___________ ___________
$ 25,570 $ 38,257
___________ ___________
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable 2,997 1,298
___________ ___________
Total Current Liabilities 2,997 1,298
___________ ___________
STOCKHOLDERS' EQUITY:
Preferred stock, $.001 par value,
500,000 shares authorized,
no shares issued and outstanding - -
Common stock, $.001 par value,
50,000,000 shares authorized,
2,305,500 shares issued and
outstanding 2,306 2,306
Capital in excess of par value 50,706 50,706
Deficit accumulated during the
development stage (30,439) (16,053)
___________ ___________
Total Stockholders' Equity 22,573 39,959
___________ ___________
$ 25,570 $ 38,257
___________ ___________
NOTE: The balance sheet at December 31, 1997 was taken from the
audited financial statements at that date and condensed.
The accompanying notes are an integral part of these financial
statements.
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
For the Three For the Six From Inception
Months Ended Months Ended on July 3,
June 30, June 30, 1996 Through
June 30,
__________________ ___________________ 1998
1998 1997 1998 1997
_________ ________ _________ _________ __________
REVENUE:
Commissions
earned $ 476 $ - $ 476 $ - $ 476
_________ ________ _________ _________ __________
EXPENSES:
General and
administrative 7,654 563 15,501 3,481 31,707
_________ ________ _________ _________ __________
INCOME (LOSS) FROM
OPERATIONS (7,178) (563) (15,025) (3,481) (31,231)
OTHER INCOME:
Interest 279 - 639 - 792
_________ ________ _________ _________ __________
LOSS BEFORE INCOME
TAXES (6,899) (563) (14,386) (3,481) (30,439)
CURRENT TAX EXPENSE - - - - -
DEFERRED TAX EXPENSE - - - - -
_________ ________ _________ _________ __________
NET LOSS $ (6,899) $ (563) $(14,386) $ (3,481) $ (30,439)
_________ ________ __________ _________ __________
LOSS PER COMMON SHARE $ (.00) $ (.00) $ (.01) $ (.00) $ (.01)
_________ ________ __________ _________ __________
The accompanying notes are an integral part of these financial
statements.
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
For the Six From Inception
Months Ended on July 3,
June 30, 1996 Through
_______________________ June 30,
1998 1997 1998
___________ ___________ _____________
Cash Flows to Operating Activities:
Net loss $ (14,386) $ (3,481) $ (30,439)
Adjustments to reconcile net
loss to net cash used by
operating activities:
Depreciation expense 38 - 41
Amortization expense 100 100 383
Changes in assets and
liabilities:
Increase in accounts payable 1,699 1,791 2,997
___________ ___________ _____________
Net Cash Flows (Used) by
Operating Activities (12,549) (1,590) (27,018)
___________ ___________ _____________
Cash Flows to Investing Activities:
Payment of organization costs - - (1,000)
Certificate of deposit 20,096 - -
Property, plant and equipment (295) - (666)
___________ ___________ _____________
Net Cash Provided (Used) by
Investing Activities 19,801 - (1,666)
___________ ___________ _____________
Cash Flows from Financing Activities:
Proceeds from common stock issuance - - 71,100
Payments for stock offering costs - (979) (18,088)
___________ ___________ _____________
Net Cash Provided by
Financing Activities - (979) 53,012
___________ ___________ _____________
Net Increase (Decrease) in Cash 7,252 (2,569) 24,328
Cash at Beginning of Period 17,076 2,603 -
___________ ___________ _____________
Cash at End of Period $ 24,328 $ 34 $ 24,328
___________ ___________ _____________
Supplemental Disclosures of Cash Flow information:
Cash paid during the period for:
Interest $ - $ - $ -
Income taxes $ - $ - $ -
Supplemental schedule of Noncash Investing and Financing
Activities:
For the period ended June 30, 1998:
None
For the period ended June 30, 1997:
None
The accompanying notes are an integral part of these financial
statements.
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Organization - The Company was organized under the laws of the
State of Delaware on July 3, 1996. The Company has not yet
generated significant revenues from its planned principal
operations and is considered a development stage company as
defined in SFAS No. 7. The Company is planning to engage in the
business of establishing a multi-level marketing network to
provide customized mailing and fax services for various network
marketing companies. The Company is also attempting to form its
own network marketing organization within the communications
industry. The Company has, at the present time, not paid any
dividends and any dividends that may be paid in the future will
depend upon the financial requirements of the Company and other
relevant factors.
Condensed Financial Statements - The accompanying financial
statements 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 operations and cash flows at June
30, 1998 and for all the 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 statements and notes thereto
included in the Company's December 31, 1997 audited financial
statements. The results of operations for the periods ended June
30, 1998 is not necessarily indicative of the operating results
for the full year.
Accounting Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles required
management to make estimates and assumptions that effect the
reported amounts of assets and liabilities, the disclosures of
contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from
those estimated by management.
NOTE 2 - PROPERTY AND EQUIPMENT
The following is a summary of equipment, at cost, less
accumulated depreciation:
June 30, December 31,
1998 1997
_________ _________
Equipment $ 666 $ 371
Less Accumulated depreciation (41) (3)
_________ _________
$ 625 $ 368
_________ _________
Depreciation expense for the six months ended June 30, 1998 and
1997 was $38 and $0, respectively.
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
NOTES TO FINANCIAL STATEMENTS
NOTE 3 - INCOME TAXES
The Company accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109 "Accounting
for Income Taxes". FASB 109 requires the Company to provide a
net deferred tax asset/liability equal to the expected future tax
benefit/expense of temporary reporting differences between book
and tax accounting methods and any available operating loss or
tax credit carryforwards. At June 30, 1998, the Company has
available unused operating loss carryforwards of approximately
$30,500, which may be applied against future taxable income and
which expire in 2011 through 2013.
The amount of and ultimate realization of the benefits from the
operating loss carryforwards for income tax purposes is
dependent, in part, upon the tax laws in effect, the future
earnings of the Company, and other future events, the effects of
which cannot be determined. Because of the uncertainty
surrounding the realization of the loss carryforwards the Company
has established a valuation allowance equal to the tax effect of
the loss carryforwards and, therefore, no deferred tax asset has
been recognized for the loss carryforwards. The net deferred tax
assets are approximately $10,300 and $5,400 as of June 30, 1998
and December 31, 1997, respectively, with an offsetting valuation
allowance at each period end of the same amount resulting in a
change in the valuation allowance of approximately $4,900 for the
six months ended June 30, 1998.
NOTE 4 - RELATED PARTY TRANSACTIONS
Management Compensation - The Company has not paid any
compensation to its officers and directors.
Related Party Compensation - Certain relatives of officers and
directors of the Company were paid a total of $942 and $3,923 in
consulting fees during the six months ended June 30, 1998 and the
year ended December 31, 1997.
Office Space - The Company has not had a need to rent office
space. An officer/shareholder of the Company is allowing the
Company to use his home as a mailing address, as needed, at no
expense to the Company.
NOTE 5 - DEVELOPMENT STAGE COMPANY
The Company was formed with a very specific business plan.
However, the possibility exists that the Company could expend
virtually all of its working capital in a relatively short time
period and may not be successful in establishing on-going
profitable operations.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted
from financial statements for the six month period ended
June 30, 1998, and is qualified in its entirety by reference
to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 24,328
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<ALLOWANCES> 0
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<CURRENT-ASSETS> 24,328
<PP&E> 666
<DEPRECIATION> 41
<TOTAL-ASSETS> 25,570
<CURRENT-LIABILITIES> 2,997
<BONDS> 0
0
0
<COMMON> 2,306
<OTHER-SE> 20,267
<TOTAL-LIABILITY-AND-EQUITY> 25,570
<SALES> 476
<TOTAL-REVENUES> 476
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 15,501
<LOSS-PROVISION> 0
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<INCOME-PRETAX> (14,386)
<INCOME-TAX> 0
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<NET-INCOME> (14,386)
<EPS-PRIMARY> (.01)
<EPS-DILUTED> (.01)
</TABLE>
