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, 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 March
31, 1998: 2,305,500
PART I - FINANCIAL INFORMATION
<PAGE>
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 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.
-2-
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
None.
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
-3-
<PAGE>
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: May 18, 1998 by: /s/ Bob Blackley
Bob Blackley, Secretary
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
CONTENTS
PAGE
_ Unaudited Condensed Balance Sheets, March 31,
1998 and December 31, 1997 2
_ Unaudited Condensed Statements of Operations,
for the three months ended March 31, 1998
and 1997, and from inception on July 3, 1996
through March 31, 1998 3
_ Unaudited Condensed Statements of Cash Flows
for the three months ended March 31, 1998 and
1997,and from inception on July 3, 1996 through
March 31,1998 5
_ Notes to Financial Statements 6 - 9
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
UNAUDITED CONDENSED BALANCE SHEETS
ASSETS
March 31, December 31,
1998 1997
___________ ___________
CURRENT ASSETS:
Cash in bank $ 10,902 $ 17,076
Certificate of deposit - held to maturity 20,330 20,096
___________ ___________
Total Current Assets 31,232 37,172
___________ ___________
PROPERTY AND EQUIPMENT, net 350 368
___________ ___________
OTHER ASSETS:
Organizational costs, net 667 717
___________ ___________
Total Other Assets 667 717
___________ ___________
$ 32,249 $ 38,257
___________ ___________
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable 2,777 1,298
___________ ___________
Total Current Liabilities 2,777 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 (23,540) (16,053)
___________ ___________
Total Stockholders' Equity 29,472 39,959
___________ ___________
$ 32,249 $ 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.
-2-
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF OPERATIONS
For the Three From Inception on
Months Ended July 3, 1996
March 31, Through
______________________ March 31,
1998 1997 1998
__________ __________ ___________
REVENUE $ - $ - $ -
__________ __________ ___________
EXPENSES:
General and administrative 7,847 2,918 24,053
__________ __________ ___________
INCOME (LOSS) FROM OPERATIONS (7,847) (2,918) (24,053)
OTHER INCOME:
Interest 360 - 513
__________ __________ ___________
LOSS BEFORE INCOME TAXES (7,487) (2,918) (23,540)
CURRENT TAX EXPENSE - - -
DEFERRED TAX EXPENSE - - -
__________ __________ ___________
NET LOSS $(7,487) $(2,918) $(23,540)
__________ __________ ___________
LOSS PER COMMON SHARE $ (.00) $ (.00) $ (.01)
__________ __________ ___________
The accompanying notes are an integral part of these financial statements.
-3-
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
UNAUDITED CONDENSED STATEMENTS OF CASH FLOWS
For the Three From Inception on
Months Ended July 3, 1996
March 31, Through
_______________________ March 31,
1998 1997 1998
____________________________________
Cash Flows from Operating Activities:
Net loss $ (7,487) $ (2,918) $ (23,540)
Adjustments to reconcile net loss to
net cash used by operating activities:
Depreciation expense 18 - 21
Amortization expense 50 50 333
Changes in assets and liabilities:
Increase in accounts payable 1,479 1,735 2,777
_____________________________________
Net Cash (Used) by Operating
Activities (5,940) (1,133) (20,409)
_____________________________________
Cash Flows from Investing Activities:
Payments for organization costs - - (1,000)
Certificate of deposit (234) - (20,330)
Property, plant and equipment - - (371)
_____________________________________
Net Cash (Used) by Investing
Activities (234) - (21,701)
_____________________________________
Cash Flows from Financing Activities:
Proceeds from common stock issuance - - 71,100
Payment of stock offering costs - (979) (18,088)
_____________________________________
Net Cash Provided by Financing
Activities - (979) 53,012
_____________________________________
Net Increase (Decrease) in Cash (6,174) (2,112) 10,902
Cash at Beginning of Period 17,076 2,603 -
_____________________________________
Cash at End of Period $ 10,902 $ 491 $ 10,902
_____________________________________
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 March 31, 1997
None
For the Period Ended March 31, 1998
None
The accompanying notes are an integral part of these financial statements.
-4-
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
NOTES TO 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 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 March
31, 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
March 31, 1998 is not necessarily indicative of the operating
results for the full year.
Certificate of Deposit - The Company accounts for investments in
debt and equity securities in accordance with Statement of
Financial Accounting Standard (SFAS) 115, "Accounting for certain
Investments in Debt and Equity Securities,". Under SFAS 115 the
Company's certificate of deposit (a debt security) has been
classified as held-to-maturity and is recorded at amortized cost.
Held-to-maturity securities represent those securities that the
Company has both the positive intent and ability to hold until
maturity (See Note 2).
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 - CERTIFICATE OF DEPOSIT
Certificates of deposit are carried at amortized cost and
consisted of the following investment at March 31, 1998:
Purchase Amortized Maturity
Date Acquired Maturity Date Value Cost Value
______________ ______________ _________ ___________ __________
11/24/97 5/24/98 $20,000 $20,330 $20,475
_________ ___________ __________
$20,000 $20,330 $20,475
_________ ___________ __________
-5-
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
NOTES TO FINANCIAL STATEMENTS
NOTE 3 - PROPERTY AND EQUIPMENT
The following is a summary of equipment, at cost, less
accumulated depreciation:
March 31, December 31,
1998 1997
_________ _________
Equipment $ 371 $ 371
Less Accumulated depreciation (21) (3)
_________ _________
$ 350 $ 368
_________ _________
Depreciation expense for the three months ended March 31, 1998
and 1997 was $18 and $0, respectively.
NOTE 4 - CAPITAL STOCK
Common Stock - During August 1997 the Company issued 305,500
shares of common stock in a public offering. The offering was
made pursuant to a registration statement on Form SB-2 which was
filed with the Securities and Exchange Commission. The offering
price of $.20 per share was arbitrarily determined by the
Company. The total proceeds of the offering amounted to $61,100.
Offering costs of $18,088 were offset against the proceeds as a
reduction to capital in excess of par value.
Common Stock - During July, 1996, in connection with its
organization, the Company issued 2,000,000 shares of its
previously authorized, but unissued common stock. Total proceeds
from the sale of stock amounted to $10,000 (or $.005 per share).
Preferred Stock - The Company has authorized 500,000 shares of
preferred stock, $.001 par value, with such rights, preferences
and designations and to be issued in such series as determined by
the Board of Directors. No shares are issued and outstanding at
December 31, 1997 and 1996.
NOTE 5 - 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 March 31, 1998, the Company has
available unused operating loss carryforwards of approximately
$24,000, which may be applied against future taxable income and
which expire in 2011 through 2013.
-6-
<PAGE>
HEALTH BUILDERS INTERNATIONAL, INC.
[A Development Stage Company]
NOTES TO FINANCIAL STATEMENTS
NOTE 5 - INCOME TAXES [Continued]
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 $8,200 and $5,400 as of March 31, 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 $2,800 for the
three months ended March 31, 1998.
NOTE 6 - 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 $ 533 and $3,923
in consulting fees during the three months ended March 31, 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 7 - 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.
-7-
<PAGE>
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 10,902
<SECURITIES> 20,330
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 31,232
<PP&E> 350
<DEPRECIATION> 0
<TOTAL-ASSETS> 32,249
<CURRENT-LIABILITIES> 2,777
<BONDS> 0
0
0
<COMMON> 2,306
<OTHER-SE> 27,166
<TOTAL-LIABILITY-AND-EQUITY> 32,249
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 7,847
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (7,487)
<INCOME-TAX> 0
<INCOME-CONTINUING> (7,487)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (7,487)
<EPS-PRIMARY> (.00)
<EPS-DILUTED> (.00)
</TABLE>
