<PAGE>
FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE MONTH OF SEPTEMBER 1999
A.C.L.N. LIMITED
(Name of Registrant)
REYNDERSSTRAAT 30
2000 ANTWERP, BELGIUM
(Address of Principal Executive Offices)
INDICATE BY CHECK MARK WHETHER THE REGISTRANT FILES OR WILL FILE ANNUAL REPORTS
UNDER COVER FORM 20-F OR FORM 40-F
FORM 20-F X FORM 40-F
------- -------
INDICATE BY CHECK MARK WHETHER THE REGISTRANT BY FURNISHING THE INFORMATION
CONTAINED IN THIS FORM IS ALSO THEREBY FURNISHING THE INFORMATION TO THE
COMMISSION PURSUANT TO RULE 12g3-2(b) UNDER THE SECURITIES EXCHANGE ACT OF 1934
YES NO X
------- -------
IF "YES" IS MARKED, INDICATE BELOW THE FILE NUMBER ASSIGNED TO THE REGISTRANT IN
CONNECTION WITH RULE 12g3-2(b): NOT APPLICABLE.
<PAGE>
Annexed hereto are (i) copies of the Condensed Consolidated Financial
Statements of A.C.L.N. Limited, a Cyprus corporation (the "Company"), for the
three and nine months ended September 30, 1999 and 1998 presented in accordance
with accounting principles generally accepted in the United States, (ii)
Management's Discussion and Analysis of Financial Condition and Results of
Operations for such periods, and (iii) a description of the material
developments of the Company.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
A.C.L.N. LIMITED
DATE: February 28, 2000 BY: /S/ Michael Doherty
-------------------------------------
NAME: Michael Doherty
TITLE: Director
<PAGE>
INDEX TO EXHIBITS
Exhibit
-------
99.A Condensed Consolidated Financial Statements of A.C.L.N.
Limited and subsidiary for the three and nine months ended
September 30, 1999 and 1998 presented in accordance with
accounting principles generally accepted in the United States
99.B Management's Discussion and Analysis of Financial Condition
and Results of Operations
99.C Material developments
<PAGE>
EXHIBIT 99.A
ACLN LIMITED
- --------------------------------------------------------------------------------
CONSOLIDATED FINANCIAL STATEMENTS
QUARTER ENDED SEPTEMBER 30, 1999
1
<PAGE>
ACLN LIMITED
CONTENTS
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
CONSOLIDATED FINANCIAL STATEMENTS:
Balance sheets 3
Statements of income 4
Statements of shareholders' equity 5
Statements of cash flows 6
Notes to financial statements 7-8
</TABLE>
2
<PAGE>
ACLN LIMITED
CONSOLIDATED BALANCE SHEETS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
September 30, 1999 December 31, 1998
(Unaudited) (Audited)
- ------------------------------------------------------------------- ------------------------ ------------------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 4,822,158 $11,264,950
Cash restricted as to withdrawal 56,701,128 36,358,280
Accounts receivable, net of allowance for bad debts of
$262,429 and $345,483 3,221,441 1,487,827
Deferred expenses 1,363,277 -
Furniture and fixtures 5,726 -
Deposits 6,033 6,587
- ------------------------------------------------------------------- ------------------------ ------------------------
$ 66,119,763 $49,117,644
=================================================================== ======================== ========================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accruals $817,103 $ 516,311
Amounts due to related parties 38,378 41,904
Income taxes payable 2,586,030 1,870,767
- ------------------------------------------------------------------- ------------------------ ------------------------
3,441,511 2,428,982
- ------------------------------------------------------------------- ------------------------ ------------------------
COMMITMENTS
SHAREHOLDERS' EQUITY :
Ordinary shares, stated value of CL 0,01 each 8,200,000 shares
issued and outstanding 158,470 158,470
Paid-in capital 13,471,955 13,391,955
Retained earnings 49,007,694 33,108,677
Accumulated other comprehensive income 40,133 29,560
- ------------------------------------------------------------------- ------------------------ ------------------------
TOTAL SHAREHOLDERS' EQUITY 62,678,252 46,688,662
- ------------------------------------------------------------------- ------------------------ ------------------------
$66,119,763 $49,117,644
=================================================================== ======================== ========================
</TABLE>
3
<PAGE>
ACLN LIMITED
CONSOLIDATED STATEMENTS OF INCOME
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Nine-month period Three-month period
ended September 30, ended September 30,
-------------------------------- ---------------------------------
(Unaudited) (Unaudited)
1999 1998 1999 1998
- ------------------------------------------------ --------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
SALES $72,331,820 $60,376,911 $28,156,400 $27,936,361
COST OF SALES 52,368,974 44,333,348 20,310,308 20,136,285
- ------------------------------------------------ --------------- ---------------- ---------------- ----------------
GROSS PROFIT 19,962,846 16,043,563 7,846,092 7,800,076
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 3,237,668 2,827,728 1,226,794 1,507,549
- ------------------------------------------------ --------------- ---------------- ---------------- ----------------
INCOME FROM OPERATIONS 16,725,178 13,215,835 6,619,298 6,292,527
- ------------------------------------------------ --------------- ---------------- ---------------- ----------------
OTHER INCOME (EXPENSE)
Interest income - 49,530 - 49,379
Interest expense - - - -
- ------------------------------------------------ --------------- ---------------- ---------------- ----------------
- 49,530 - 49,379
- ------------------------------------------------ --------------- ---------------- ---------------- ----------------
INCOME BEFORE INCOME TAXES 16,725,178 13,265,365 6,619,298 6,341,906
INCOME TAXES 826,161 628,587 349,972 297,356
- ------------------------------------------------ --------------- ---------------- ---------------- ----------------
NET INCOME 15,899,017 12,636,778 6,269,326 6,044,550
- ------------------------------------------------ --------------- ---------------- ---------------- ----------------
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:
FOREIGN CURRENCY TRANSLATION ADJUSTMENTS 10,573 82,200 51,938 98,548
- ------------------------------------------------ --------------- ---------------- ---------------- ----------------
COMPREHENSIVE INCOME $15,909,590 $12,718,978 $6,321,264 $ 6,143,098
================================================ =============== ================ ================ ================
NET INCOME PER SHARE - BASIC AND DILUTED $ 1.94 $ 1.71 $ 0.76 $ 0.74
================================================ =============== ================ ================ ================
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC 8,200,000 7,404,396 8,200,000 8,200,000
================================================ =============== ================ ================ ================
WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED 8,239,066 7,404,396 8,248,000 8,200,000
================================================ =============== ================ ================ ================
</TABLE>
4
<PAGE>
ACLN LIMITED
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(UNAUDITED)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Capital Stock Paid-in Retained Cumulative Total
Capital Earnings Translation
Adjustment
Number Amount
- ---------------------------------------- ----------- ---------------- --------------- ------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Balance December 31, 1998 8,200,000 $158,470 $13,391,955 $33,108,677 $29,560 $46,688,662
Net income - - 15,899,017 - 15,899,017
Stock options issued for services - 80,000 - - 80,000
Cumulative translation adjustment - - - 10,573 10,573
- ---------------------------------------- ----------- ---------------- --------------- ------------- -------------- --------------
Balance September 30, 1999 8,200,000 $158,470 $13,471,955 $49,007,694 $40,133 $62,678,252
======================================== =========== ================ =============== ============= ============== ==============
</TABLE>
5
<PAGE>
ACLN LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Nine month period
ended September 30,
----------------------------------------------
(Unaudited)
1999 1998
- ---------------------------------------------------------------------------------- ----------------------- ----------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $15,899,017 $12,636,778
Adjustments to reconcile net income to net cash provided by operating
activities
Depreciation 420 -
Stock issued for services 80,000 -
Changes in assets and liabilities:
Cash restricted as to withdrawal (20,342,848) (13,837,845)
Accounts receivable (1,722,487) (2,602,170)
Deferred expenses (1,363,277) 1,103,180
Accounts payable and accruals 300,792 (1,184,293)
Amounts due to related parties (3,526) 141,053
Income taxes payable 715,263 619,072
- ---------------------------------------------------------------------------------- ----------------------- ----------------------
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES (6,436,646) (3,124,225)
- ---------------------------------------------------------------------------------- ----------------------- ----------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
- ---------------------------------------------------------------------------------- ----------------------- ----------------------
Purchase of fixed assets (6,146) -
- ---------------------------------------------------------------------------------- ----------------------- ----------------------
NET CASH PROVIDED BY INVESTING ACTIVITIES (6,146) -
- ---------------------------------------------------------------------------------- ----------------------- ----------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Capital contribution - 10,555,000
- ---------------------------------------------------------------------------------- ----------------------- ----------------------
NET CASH PROVIDED BY FINANCING ACTIVITIES - 10,555,000
- ---------------------------------------------------------------------------------- ----------------------- ----------------------
NET INCREASE IN CASH AND CASH EQUIVALENTS (6,442,792) 7,430,775
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 11,264,950 36,793
- ---------------------------------------------------------------------------------- ----------------------- ----------------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $4,822,158 $ 7,467,568
================================================================================== ======================= ======================
SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes $ - $ -
Interest paid $ - $ -
Interest received $ - $49,530
================================================================================== ======================= ======================
</TABLE>
6
<PAGE>
ACLN LIMITED
NOTES TO FINANCIAL STATEMENTS
(INFORMATION WITH RESPECT TO SEPTEMBER 30, 1999 AND THE NINE
MONTHS ENDED SEPTEMBER 30, 1999 AND 1998 IS UNAUDITED)
- --------------------------------------------------------------------------------
1. INCEPTION AND PRINCIPAL ACLN Limited was incorporated on
ACTIVITIES February 16, 1993 in Cyprus as Hemswell
Holdings Co Limited and later changed
its name to ACLN Limited. It remained
dormant until January 1, 1995, when it
acquired Compagnie Labiad de Navigation
S.A.M., a Company incorporated in
Monaco. The principal activity of the
group is the operation of liner services
for the transport of cargo.
2. SIGNIFICANT ACCOUNTING UNAUDITED INTERIM CONSOLIDATED FINANCIAL
POLICIES STATEMENTS
In the opinion of the Company's
management, the consolidated balance
sheet as of September 1999, the
consolidated statements of operations
for the three and nine months ended
September 30, 1998 and 1999, the
consolidated statements of cash flows
and the consolidated statement of
shareholders' equity for the nine months
ended September 30, 1999 contain all
adjustments (consisting of only normal
recurring adjustments) necessary to
present fairly the information set forth
therein. The results of operations for
the three and nine months ended
September 30, 1999 are not necessarily
indicative of the results for any other
period. These financial statements
should be read in conjunction with the
Company's audited financial statements
as of and for the year ended December
31, 1998.
BASIS OF PRESENTATION
The accompanying consolidated financial
statements include the accounts of ACLN
Limited and its wholly-owned subsidiary,
Compagnie Labiad de Navigation S.A.M.
(collectively the "Company"). All
significant intercompany transactions
have been eliminated. The financial
statements have been prepared on the
basis of accounting principles generally
accepted in the United States.
REVENUE RECOGNITION
The Company is a facilitator of cargo
transport and sales are recorded at the
time the shipment in completed.
7
<PAGE>
ACLN LIMITED
NOTES TO FINANCIAL STATEMENTS
(INFORMATION WITH RESPECT TO SEPTEMBER 30, 1999 AND THE NINE MONTHS
ENDED SEPTEMBER 30, 1999 AND 1998 IS UNAUDITED)
- --------------------------------------------------------------------------------
CONCENTRATIONS OF CREDIT RISK/CASH RESTRICTED AS TO
WITHDRAWAL
The Company's trade accounts receivable are collected
on its behalf by shipping agents in the port of
destination prior to the release of the automobile to
the customer. Accordingly, the credit risk from
individual automobile shippers is considered to be
minimal. The shipping agents deposit the proceeds for
the benefit of the Company with the local central
banking system. These amounts are classified as Cash
Restricted as to Withdrawal in the accompanying
balance sheet. The funds are transferred to the
Company's bank accounts at the completion of
processing by the central banking system in
accordance with local currency exchange regulations.
Cash Restricted as to Withdrawal deposited with the
central banks on behalf of the Company by country are
as follows:
<TABLE>
<CAPTION>
Country September 30, December 31,
1999 1998
-----------------------------------------------------
<S> <C> <C>
Angola $ 7,223,496 $5,381,712
Egypt 8,085,957 5,328,565
Guinea 8,152,320 6,576,064
Ivory Coast 5,106,932 -
Nigeria 8,583,448 5,688,089
Tunisia 19,548,975 13,383,850
-----------------------------------------------------
$56,701,128 $36,358,280
=====================================================
</TABLE>
3.SUBSEQUENT EVENT In October 1999, the Company issued 632,692 shares in
a private placement in the United States with net
proceeds of approximately US$7.3 million.
8
<PAGE>
EXHIBIT 99.B
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following contains forward-looking statements which involve risks
and uncertainties. Actual events or results may differ materially from those
discussed in forward-looking statements as a result of various factors. The
following discussion of the operations and financial condition of the Company
should be read in conjunction with the Company's Consolidated Financial
Statements and the Notes thereto.
GENERAL
The following table sets forth for the periods indicated certain line
items from the Company's statement of operations as a percentage of the
Company's sales.
<TABLE>
<CAPTION>
Nine Months Three Months
Ended September 30, Ended September 30,
------------------- -------------------
1999 1998 1999 1998
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales 100.0% 100.0% 100.0% 100.0%
Cost of sales 72.4 73.4 72.1 72.1
Gross profit 27.6 26.6 27.9 27.9
Selling, 4.5 4.7 4.4 5.4
general, and
administrative
Special non- -- -- -- --
cash
compensation
charge
Income from 23.1 21.9 23.5 22.5
operations
Interest -- 0.1 -- 0.2
income
Income 23.1 22.0 23.5 22.7
before income
taxes
Income taxes 1.1 1.0 1.2 1.1
</TABLE>
<PAGE>
Net income 22.0 21.0 22.3 21.6
RESULTS OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
SALES. Sales increased by $11,954,909, or approximately 19.8%, to
$72,331,820 for the nine months ended September 30, 1999, as compared to
$60,376,911 for the nine months ended September 30, 1998. Such increase in
sales was primarily attributable to a general increase in demand for used
automobiles in North and West Africa and the Middle East and as a result of
the Company's new port of destination in the Ivory Coast. Demand grew as a
result of increasingly lenient trade restrictions and political stability in
the countries which have ports of destination served by the Company, as well
as in the regions adjacent thereto. Sales were effected negatively by the
Company's decision to temporarily halt further shipments to Angola in an
effort to accelerate the process of repatriating funds from certain African
central banks.
COST OF SALES. Cost of sales for the nine months ended September 30,
1999 was $52,368,974, representing approximately 72.4% of sales during such
period, as compared to $44,333,348, representing 73.4% of sales, during the nine
months ended September 30, 1998. The increase in the amount of cost of sales is
primarily attributable to the aforementioned increased sales during the nine
months ended September 30, 1999, as compared to the nine months ended September
30, 1998. The decrease in cost of sales as a percentage of sales was
attributable to the increased automobile volumes and resulting per automobile
efficiencies.
SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES. Selling, general, and
administrative expenses increased by $409,940, or approximately 14.5%, to
$3,237,668 during the nine months ended September 30, 1999, as compared to
$2,827,728 for the nine months ended September 30, 1998, and decreased as a
percentage of sales from 4.7% for the nine months ended September 30, 1998 to
4.5% for the nine months ended September 30, 1999. The decrease in selling,
general, and administrative expenses as a percentage of sales during the period
is attributable to the effect of various volume based efficiencies achieved by
the Company.
INCOME FROM OPERATIONS. Income from operations increased by $3,509,343,
or approximately 26.6%, to $16,725,178 for the nine months ended September 30,
1999, as compared to $13,215,835 for the nine months ended September 30, 1998.
Such increase is primarily attributable to the aforementioned increase in sales
for the nine months ended September 30, 1999 as compared to the nine months
ended September 30, 1998. Income from Operations as a percentage of sales
increased from 21.9% for the nine months ended September 30, 1998 to 23.1% for
the nine months ended September 30, 1999. This increase is the result of margin
improvements derived from increased car volumes, and the related improvements in
per car shipping costs.
NET INCOME. Net income increased by $3,190,612 or 25.1%, to $15,909,590
for the nine months ended September 30, 1999, as compared to $12,718,978 for the
nine months ended September 30, 1998.
<PAGE>
Net income as a percentage of sales increased to 22.0% of sales for the nine
months ended September 30, 1999, as compared to 21.0% of sales for the nine
months ended September 30, 1998. Such increase in net income was primarily
attributable to the aforementioned increase in sales and volume based margin
improvements.
The Company had working capital of approximately $46.7 million at
December 31, 1998 and $62.7 million at September 30, 1999.
THREE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
SALES. Sales increased by $220,039, or approximately 0.8%, to
$28,156,400 for the three months ended September 30, 1999, as compared to
$27,936,361 for the three months ended September 30, 1998. Such increase in
sales was primarily attributable to a general increase in demand for used
automobiles in North and West Africa and the Middle East and as a result of
increased sales to the Company's new port of destination in the Ivory Coast.
Sales were also affected by the Company's decision to temporarily halt
shipments to certain ports of destination in an effort to accelerate the
process of repatriating funds from certain African central banks.
COST OF SALES. Cost of sales for the three months ended September
30, 1999 was $20,310,308, representing approximately 72.1% of sales during
such period, as compared to $20,136,285, representing 72.1% of sales, during
the three months ended September 30, 1998. The increase in the amount of
cost of sales is primarily attributable to the aforementioned increased sales.
SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES. Selling, general,
and administrative expenses decreased by $280,755, or approximately 18.6%, to
$1,226,794 during the three months ended September 30, 1999, as compared to
$1,507,549 for the three months ended September 30, 1998, and decreased as a
percentage of sales from 5.4% for the three months ended September 30, 1998,
to 4.4% for the three months ended September 30, 1999. The decrease in
Selling, General and Administrative cost was the result of cost efficiencies
gained as a result of increased shipping volumes and termination of the
Company's Monaco subsidiary.
INCOME FROM OPERATIONS. Income from operations increased by
$326,771 or approximately 5.2%, to $6,619,298 for the three months ended
September 30, 1999, as compared to $6,292,527 for the three months ended
September 30, 1998. Such increase is substantially attributable to the
aforementioned increase in sales and cost efficiencies.
NET INCOME. Net income increased by $178,166 or 2.9%, to $6,321,264
for the three months ended September 30, 1999, as compared to $6,143,098 for
the three months ended September 30, 1998. Net income as a percentage of
sales increased to 22.3% of sales for the three months ended September 30,
1999, as compared to 21.6% of sales for the three months ended September 30,
1998. Such increase in net income and net income as a percentage of sales was
primarily attributable to the aforementioned increase in sales and cost
efficiencies.
LIQUIDITY AND CAPITAL RESOURCES
CREDIT AND POLITICAL RISKS
The Company's trade accounts receivable are collected on its behalf by
shipping agents in the port of destination prior to the release of the
automobile to the customer. Accordingly, the credit risk from individual
customers is considered to be minimal.
The shipping agents deposit funds on behalf of the Company with the
local central banking system. These amounts are classified as Cash Restricted as
to Withdrawal on the Company's balance sheet. The funds are transferred to the
Company's bank account at the completion of processing by the central banking
system in accordance with local currency exchange regulations. On average, this
process takes a period of three to four months.
Although the Company evaluates the reliability of the central
banking systems and the political stability of the countries of its ports of
destination, shifting political and economic conditions as well as changes in
trade and currency exchange regulations, all of which are beyond the control
of the Company, may adversely affect the transferability of collected
shipping fees, which may have a material adverse effect on the Company's
results of operations. See the Consolidated Financial Statements of the
Company and Note 2 thereto. In the past, the Company has temporarily halted
shipments to certain ports of destination such as Angola, as mentioned above,
in an effort to accelerate the process of repatriating funds from certain
African central banks.
The currency of the primary economic environment in which the
operations of the Company Company are conducted is U.S. dollars and, as such,
the Company uses the U.S. dollar as its functional currency. Transactions and
balances originally denominated in dollars are presented at their original
amounts. The extent of the Company's currency adjustments to date have not
been material.
On September 24, 1999, the Company consummated a private placement
of ordinary shares for aggregate gross proceeds of $7,303,659. The Company
intends to use such proceeds to acquire one or two shipping vessels.
OPERATING ACTIVITIES
For the nine months ended September 30, 1999, net cash used by
operating activities was $6,436,646 and net income was $15,909,590. The primary
changes in the Company's operating activities from December 31, 1998 to
September 30, 1999 were (A) (i) an increase in cash restricted as to withdrawal
of approximately $20,342,848, or 56.0%, to $56,701,128 as of September 30, 1999,
as compared to $36,358,280 as of December 31, 1998; (ii) an increase in accounts
receivable of $1,722,487, or 115.8%, to $3,221,441 as of September 30, 1999, as
compared to $1,487,827 as of
<PAGE>
December 31, 1998, and (iii) an increase in deferred expenses to $1,363,277 as
of September 30, 1999 versus $0 as of December 31, 1998, offset in part by (B)
(i) an increase in accounts payable of $300,792, or 58.3%, to $817,103 as of
September 30, 1999, as compared to $516,311 as of December 31, 1998; (ii) an
increase in income taxes payable of $715,263, or 38.2%, to $2,586,030 as of
September 30, 1999, as compared to $1,870,767 as of December 31, 1998; and (iii)
stock issued for services of $80,000.
The Company does not presently have a contingency plan for handling
Year 2000 problems that are not detected and corrected prior to their
occurrence. Any failure of the Company to address any unforeseen Year 2000
issues could adversely impact its business, prospects, financial condition and
results of operations.
RECENT ACCOUNTING PRONOUNCEMENTS
In June 1998, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for
Derivative Instruments and Hedging Activities" which requires companies to
record derivatives on the balance sheet as assets or liabilities, measured at
fair market value. Gains or losses resulting from changes in the values of those
derivatives would be accounted for depending on the use of the derivative and
whether it qualifies for hedge accounting. The key criterion for hedge
accounting is that the hedging relationship must be highly effective in
achieving offsetting changes in fair value or cash flows. SFAS No. 133 is
effective for fiscal periods beginning after June 15, 1999. Management believes
the adoption of this statement will have no material impact on the Company's
financial statements.
In the fiscal year ended December 31, 1998, the Company adopted SFAS
No. 131, "Disclosures about Segments of an Enterprise and Related Information"
which supersedes SFAS No. 14, "Financial Reporting for Segments of a Business
Enterprise." SFAS No. 131 establishes standards for the way that public
companies report information about operating segments in annual financial
statements and requires reporting of selected information about operating
segments in interim financial statements issued to the public. It also
establishes standards for disclosures regarding products and services,
geographic areas and major customers. SFAS No. 131 defines operating segments as
components of a company about which separate financial information is available
that is evaluated regularly by the chief operating decision maker in deciding
how to allocate resources and in assessing performance. SFAS No. 131 is
effective for financial statements for periods beginning after December 15,
1997, and requires comparative information for earlier years to be restated. The
adoption of this statement did not have a material impact on the Company's
financial statements.
In March 1999, the FASB issued a proposed interpretation of Accounting
Principles Board Opinion 25, relating to accounting for certain transactions
involving stock compensation. This interpretation, among other things, clarifies
accounting for option grants to non-employee directors arising after December
15, 1998, and requires that compensation be recorded based upon the fair value
of options granted. If adopted as currently proposed, the effects of this
interpretation would be recorded on a prospective basis from the effective date.
In January 1999, the Company issued 200,000 stock options to a non-employee
director that vest over a three year period from that date. Accordingly,
<PAGE>
compensation expense will be recorded from the effective date of the
interpretation over the remaining vesting period based on the fair value of the
options granted.
<PAGE>
EXHIBIT 99.C
A.C.L.N. LIMITED REPORTS INITIAL RESULTS OF HYUNDAI
AGREEMENT
A.C.L.N. SHIPS OVER 6,000 CARS UNDER THE HYUNDAI AGREEMENT SINCE MID-NOVEMBER
LIMASOL, CYPRUS - JANUARY 5, 2000 -- A.C.L.N. Limited WWW.ACLNLTD.COM (NASDAQ:
ACLNF), has already shipped more than 6,000 cars to Africa from its new ports in
Europe under an agreement reached with Hyundai last November 15, Joseph
Bisschops, Chairman of the Board of A.C.L.N., announced today.
The ports from which these shipments are originating are Hamburg, Bremerhaven,
Amsterdam and Rotterdam.
Under a three-year strategic alliance with Hyundai, A.C.L.N. has the exclusive
right to ship used cars in those four ports to Africa on Hyundai's ships. A
large percentage of the cars to be shipped from these ports will be shipped with
their freight pre-paid, unlike the majority of the cars currently shipped by the
Company for which freight fees are collected upon delivery in Africa.
"We are pleased with the preliminary results of our agreement with Hyundai. The
strength of the shipping volumes is encouraging, as is the backlog of cars we
already have at the various new ports as well as at our original port in
Antwerp. This alliance with Hyundai continues to enhance A.C.L.N.'s dominance in
shipping used cars from Europe to North and West Africa. More than ever,
A.C.L.N. is well positioned to capitalize on the growth in demand for cars from
growing African nations," said Joseph Bisschops.
"We are very excited by the success to date of our alliance with Hyundai.
Hyundai's selection of A.C.L.N. to be their partner responsible for shipping all
used cars from these ports to Africa indicates their recognition of our
leadership in this field," commented Aldo Labiad, President and Chief Executive
Officer of A.C.L.N. Limited.
<PAGE>
ABOUT A.C.L.N. LIMITED
A.C.L.N. Limited is a marine logistics company that arranges for the shipment of
automobiles from Europe to North and West Africa and the Middle East, and
provides for related customs-clearance and stevedoring services. For more
information please visit our web site at HTTP://WWW.ACLNLTD.COM
CONTACT INFORMATION:
Christian Payne
Vice President - Finance
(310) 393-3790
Forward Looking Statements
This news release contains forward-looking statements as that term is defined in
the Private Securities Litigation Reform Act of 1995. Such statements are based
on the current expectations of management and are subject to a number of risk
factors and uncertainties that could cause actual results for performance of the
company to differ materially from those described herein. Such risk factors and
uncertainties include, without limitation, those which are associated with:
recent political uncertainty in certain regions where the Company's ports of
destination are located; restrictions on the transferability of deposited
shipping fees; changes in the demand for used automobiles in the countries of
the Company's ports of destination; changes in the prices and supply of used
automobiles; economic downturns and currency fluctuations in the countries of
the Company's ports of destination; the availability of specialized automobile
transport vessels; working capital risks associated with growth of the Company's
operations; and competition with other automobile transporters.
<PAGE>
[LOGO]
A.C.L.N. LIMITED ANNOUNCES STRATEGIC ALLIANCE WITH HYUNDAI
A.C.L.N. TO SHIP FROM HAMBURG, BREMERHAVEN, ROTTERDAM AND AMSTERDAM
ANTWERP, BELGIUM - NOVEMBER 15, 1999 -- A.C.L.N. Limited WWW.ACLNLTD.COM
(NASDAQ: ACLNF), today announced a new three year strategic alliance with
Hyundai Motor Company, under which the Company will have the exclusive right to
provide shipping services to Hyundai for used cars sold in Hamburg, Bremerhaven,
Rotterdam and Amsterdam to ports in Africa. A large percentage of the cars to be
shipped from these ports will be shipped with their freight pre-paid, unlike the
majority of the cars currently shipped by the Company for which freight fees are
collected upon delivery in Africa.
KEY ELEMENTS OF THE HYUNDAI AGREEMENT
- --------------------------------------------------------------------------------
>> Three Year Term
>> Exclusive right to carry used cars for Hyundai from:
|X| Hamburg
|X| Bremerhaven
|X| Rotterdam
|X| Amsterdam
>> Primarily Pre-Paid Freight (as opposed to usual freight collect)
"This relationship provides important strategic and economic benefits to ACLN.
The strategic benefit of this agreement is the expansion of the number of
European ports we serve from one to five as well as a partnership with one of
the largest car shipping companies in the world. The economic benefits are
derived primarily from the increase in car volumes we expect as well as from the
fact that a large percentage of the cars that we plan to ship from these ports
will have their freight pre-paid. We expect both of these factors to drive
revenue growth while limiting our working capital requirements to sustain that
growth," commented Joseph Bisschops, Chairman of A.C.L.N. Limited.
<PAGE>
"We are very excited by this alliance with Hyundai, which is one of the largest
shipping companies in the world. Hyundai's selection of A.C.L.N. to be their
partner responsible for shipping all used cars from these ports to Africa
indicates their recognition of our leadership in this field," commented Aldo
Labiad, President and Chief Executive Officer of A.C.L.N. Limited.
"This alliance enhances A.C.L.N.'s dominance in shipping used cars from Europe
to North and West Africa. More than ever, A.C.L.N. is well positioned to
capitalize on the growth in demand for cars from growing African nations,"
continued Mr. Labiad.
ABOUT A.C.L.N. LIMITED
A.C.L.N. Limited is a marine logistics company that arranges for the shipment of
automobiles from Europe to North and West Africa and the Middle East, and
provides for related customs-clearance and stevedoring services. For more
information please visit our web site at HTTP://WWW.ACLNLTD.COM
CONTACT INFORMATION:
Christian Payne
Vice President - Finance
(310) 393-3790
Forward Looking Statements
This news release contains forward-looking statements as that term is defined in
the Private Securities Litigation Reform Act of 1995. Such statements are based
on the current expectations of management and are subject to a number of risk
factors and uncertainties that could cause actual results for performance of the
company to differ materially from those described herein. Such risk factors and
uncertainties include, without limitation, those which are associated with:
recent political uncertainty in certain regions where the Company's ports of
destination are located; restrictions on the transferability of deposited
shipping fees; changes in the demand for used automobiles in the countries of
the Company's ports of destination; changes in the prices and supply of used
automobiles; economic downturns and currency fluctuations in the countries of
the Company's ports of destination; the availability of specialized automobile
transport vessels; working capital risks associated with growth of the Company's
operations; and competition with other automobile transporters.
<PAGE>
A.C.L.N. LIMITED ANNOUNCES RECORD THIRD QUARTER RESULTS
THIRD QUARTER EPS OF $0.76 BEATS ANALYSTS' ESTIMATES BY $0.10 OR 15%
ANTWERP, BELGIUM - NOVEMBER 15, 1999 -- A.C.L.N. Limited WWW.ACLNLTD.COM
(NASDAQ: ACLNF), today announced its financial results of operations for the
three months ended September 30, 1999. It will hold a conference call on Tuesday
November 16, 1999 to discuss the results of the third quarter. The call in
number is 800-486-2726 domestically and 201-368-8643 internationally. The
participant code is 522992.
Sales for the three months ended September 30, 1999 were $28,156,400 and net
income increased to $6,269,326 compared to sales and net income of $27,936,361
and $6,143,098, respectively, for the three months ended September 30, 1998. For
the nine months ended September 30, 1999, sales were up by $11,954,909 to
$72,331,820 from $60,376,911. For the nine months ended September 30, 1999, net
income increased by 25.1% or $3,190,612 to $15,909,590 from $12,718,978.
Earnings per share increased by $0.02, or 2.7%, to $0.76 for the three months
ended September 30, 1999, compared with $0.74 for the three months ended
September 30, 1998. For the nine months ended September 30, 1999, earnings per
share increased by 13.5% or $0.23 to $1.94 from $1.71.
On September 30, 1999, the company had $61,523,286 of cash and restricted cash
on its balance sheet, or $7.46 of net cash per share.
"We are very pleased with our third quarter results and with the steady increase
in business we are seeing in our served markets." commented Joseph Bisschops,
Chairman and Managing Director of A.C.L.N. Limited. "The volume in the third
quarter of last year was particularly strong due to an unusually large backlog
and the availability of working capital due to our completion of the initial
public offering. Even so, we were able to outperform last year's results."
"Importantly, during this quarter we were successful in collecting significant
amounts of cash from the banks in Africa. This was achieved, however, at the
expense of shipping cars to specific markets where we had large exposures to
central banks. These delays caused us to defer over $0.06 per share in earnings
into the fourth quarter. In addition, our backlog of cars going into the fourth
quarter therefore was higher than usual."
<PAGE>
ABOUT A.C.L.N. LIMITED
A.C.L.N. Limited is a marine logistics company that arranges for the shipment of
automobiles from Europe to North and West Africa and the Middle East, and
provides for related customs-clearance and stevedoring services. For more
information please visit our web site at HTTP://WWW.ACLNLTD.COM
SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
September 30, September 30,
1999 1998 1999 1998
----------------- ----------------- ---------------- -----------------
<S> <C> <C> <C> <C>
Sales $72,331,820 $60,376,911 $28,156,400 $27,936,361
Cost of sales 52,368,974 44,333,348 20,310,308 20,136,285
---------- ---------- ---------- ----------
Gross profit 19,962,846 16,043,563 7,846,092 7,800,076
Selling, general and
Administrative expenses 3,237,668 2,827,728 1,226,794 1,507,549
---------- ---------- ---------- ----------
Income from operations 16,725,178 13,215,835 6,619,298 6,292,527
Other income (expense): ---- 49,530 ---- 49,379
---------- ---------- ---------- ----------
Income before income
Taxes 16,725,178 13,265,365 6,619,298 6,341,906
Income taxes 826,161 628,587 349,972 297,356
Net income 15,899,017 12,636,778 6,269,326 6,044,550
Other comprehensive
income (loss) net of tax:
Foreign currency
translation adjustments 10,573 82,200 51,938 98,548
Comprehensive income 15,909,590 12,718,978 $6,321,264 $6,143,098
========== ========== ========== ==========
Net income per share 1.94 1.71 $0.76 $0.74
Weighted average shares
Outstanding 8,200,000 7,404,396 8,200,000 8,200,000
</TABLE>
<PAGE>
BALANCE SHEET DATA
As of September 30, 1999
<TABLE>
<CAPTION>
<S> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 4,822,158
Cash restricted as to withdrawal 56,701,128
Accounts receivable, net of allowance for bad debts
Of $262,429 and $345,483 3,221,441
Deferred expenses 1,363,277
Other Assets 11, 759
-----------
TOTAL ASSETS $66,119,763
===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accruals $817,103
Amounts due to related parties 38,378
Income taxes payable 2,586,030
-----------
3,441,511
-----------
SHAREHOLDERS' EQUITY:
Ordinary shares, stated value of CL 0,01 each,
8,200,000 shares issued and outstanding 158,470
Paid-in capital 13,471,955
Retained earnings 49,007,694
Accumulated other comprehensive income 40,133
-----------
TOTAL SHAREHOLDERS' EQUITY 62,678,252
-----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $66,119,763
===========
</TABLE>
CONTACT INFORMATION:
Christian Payne
Vice President - Finance
(310) 393-3790
Forward Looking Statements
This news release contains forward-looking statements as that term is defined in
the Private Securities Litigation Reform Act of 1995. Such statements are based
on the current expectations of management and are subject to a number of risk
factors and uncertainties that could cause actual results for performance of the
company to differ materially from those described herein. Such risk factors and
uncertainties include, without limitation, those which are associated with:
recent political uncertainty in certain regions where the Company's ports of
destination are located; restrictions on the transferability of deposited
shipping fees; changes in the demand for used automobiles in the countries of
the Company's ports of destination; changes in the prices and supply of used
automobiles; economic downturns and currency fluctuations in the countries of
the Company's ports of destination; the availability of specialized automobile
transport vessels; working capital risks associated with growth of the Company's
operations; and competition with other automobile transporters.
