FORM 10-QSB - Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
UNITED STATES
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 period ended March 31, 1999
------------------------
or
[ ] Transition Report Pursuance to Section 13 or 15(d) of the Securities
Exchange act of 1934.
For the transition period from to
Commission File Number 0-22027
----------------
ROCKY MOUNTAIN POWER CO.
----------------------------------------------------
(Exact name of registrant as specified in its charter)
Colorado 84-0503585
------------------------------ ---------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
12835 E. Arapahoe Road, T-II, Ste. 110, Englewood, CO 80046
-------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(303) 792-2466
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(Registrant's telephone number, including area code)
--------------------------------------------------------------
(Former name, former address and former fiscal year, if changed
since last report.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
[ X ] Yes [ ] No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a
plan confirmed by a court.
[ ] Yes [ ] No
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of March 31, 1999, Registrant had 608,916 shares of common stock, $.05 par
value, outstanding.
<PAGE>
INDEX
Page
Number
- ------
Part I. Financial Information
Item I. Financial Statements
Balance Sheets as of March 31, 1999
(Unaudited) and June 30, 1998 2
Statement of Income, Three Months
Ended March 31, 1999 and March 31, 1998
(Unaudited) 3
Statement of Income, Nine Months
Ended March 31, 1999 and March 31, 1998
(Unaudited) 4
Statement of Cash Flows, Three Months
Ended March 31, 1999 and March 31, 1998
(Unaudited) 5
Statement of Cash Flows, Nine Months
Ended March 31, 1999 and March 31, 1998
(Unaudited) 6
Notes to Financial Statements 7
Item 2. Management's Discussion and Analysis of
Financial Conditions and Results of
Operations 8
Part II. Other Information 9
1
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
ASSETS
March 31, June 30,
1999 1998
--------- --------
<S> <C> <C>
Current Assets:
Cash $ 32,812 $
70,229
Certificates of purchase, real estate
foreclosures - 799,801
Real Estate held for sale 917,723 -
Mortgage notes receivable, current
portion 304,531 301,574
Mortgage note receivable, related party 139,079 139,079
Deferred income taxes receivable, current 4,626 4,626
Other 54,047 26,685
--------- ---------
Total Current Assets 1,452,818 1,341,994
Real estate, net of accumulated deprec-
iation of $5,636 at March 31, 1999 and
$4,000 at June 30, 1998 235,192 244,317
Transportation equipment, net of accumulated
depreciation of $5,375 at March 31, 1999 and
$3,125 and June 30, 1998 9,625 11,875
Mortgage notes receivable, net of current portion 828,180 814,010
Other 57,213 57,213
-------- -------
TOTAL ASSETS $ 2,583,028 $ 2,469,409
=========== ===========
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
Current Liabilities:
Accounts payable and accrued expenses $ 10,281 $ 6,931
Notes payable, current portion 378,991 318,519
Income taxes payable 34,608 39,531
Deferred taxes payable, current portion 1,678 1,621
Other 12,655 22,243
------- -------
Total Current Liabilities 438,213 388,845
Deferred taxes payable, long term 35,906 35,906
Notes payable, net of current portion 22,814 28,109
------- -------
TOTAL LIABILITIES 496,933 452,860
======= =======
Stockholders' Equity:
Preferred stock, $25.00 par value, 200,000
shares authorized, none issued & outstanding - -
Common stock, $.05 par value, 100,000,000
shares authorized, 608,916 shares issued
and outstanding at March 31, 1999 and
607,853 shares at June 30, 1998 30,446 30,393
Additional paid-in capital 1,614,435 1,610,988
Retained earnings 441,214 375,168
--------- ---------
TOTAL STOCKHOLDERS' EQUITY 2,086,095 2,016,549
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,583,028 $ 2,469,409
=========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
2
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31, March 31,
1999 1998
--------- ---------
<S> <C> <C>
Revenue:
Rent income 5,250 2,207
Interest income 43,564 31,799
Gain on disposition of asset (Note 2) 41 82,809
Other income - 27,769
------ -------
48,855 144,584
====== =======
Operating Expenses:
Depreciation 1,125 1,126
Interest - 6,227
Rent - 9,705
Auditing and accounting - 388
Other 8,975 41,339
------ ------
10,100 58,785
------ ------
Net income before provision
for income taxes 38,755 85,799
Provision for income taxes 14,908 15,648
------ ------
Net income $ 23,847 $ 70,151
========== ==========
Per Share $ .04 $ .09
========== ==========
Weighted Average Shares Outstanding 608,916 752,537
========== ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
March 31, March 31,
1999 1998
--------- ---------
<S> <C> <C>
Revenue:
Rent income 14,710 23,095
Interest income 112,889 111,385
Gain on disposition of asset (Note 2) 2,800 82,809
Other income 6,400 50,969
136,799 268,258
Operating Expenses:
Depreciation 3,886 11,125
Interest 257 43,730
Rent - 23,366
Audit and accounting 9,615 11,173
Other 19,597 71,278
------ -------
33,355 160,672
------ -------
Net income before provision
for income taxes 103,444 107,586
Provision for income taxes 37,398 20,005
------- -------
Net income $ 66,046 $ 87,581
========== ==========
Per Share $ .11 $ .12
========== ==========
Weighted Average Shares Outstanding 608,916 752,537
========== ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
4
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31, March 31,
1999 1998
----------- ---------
<S> <C> <C>
Cash Flows Operating Activities:
Net income $ 23,847 $ 70,151
Depreciation 1,125 1,126
Increase in income taxes payable 14,908 15,178
Increase in deferred income taxes payable - 6,243
Increase in accounts payable and accrued expenses 4,949 74,016
Stock issued for services 3,500 -
Other (28,014) 8,050
-------- -------
Net Cash Provided by Operating Activities 20,315 174,764
-------- -------
Cash Flows from Investing Activities:
(Investments) in certificates of purchase (65,153) (128,600)
Proceeds from redemptions of certificates
of purchase 244,206 835,030
(Investment) in notes receivable (105,000) (326,206)
Collection of notes receivable 5,622 32,508
Other 123,849 87,775
------- -------
Net Cash Provided by Investing Activities 203,524 500,507
------- -------
Cash Flows from Financing Activities:
(Repayment of) bank notes payable (263,742) (403,870)
(Repayment of) mortgage notes payable (1,324) (1,822)
--------- ---------
Net Cash (Used in) Financing Activities (265,066) (405,692)
--------- ---------
Increase (decrease) in Cash (41,227) 269,579
Cash, Beginning of Period 74,039 68,904
-------- --------
Cash, End of Period $ 32,812 338,483
========== ==========
Interest Paid $ 8,634 $ 6,227
========== ==========
Income Taxes Paid $ - $ -
========== ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
5
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
March 31, March 31,
1999 1998
--------- ---------
<S> <C> <C>
Cash Flows Operating Activities:
Net income $ 66,046 $ 87,581
Depreciation 3,886 11,125
Increase (decrease) in income taxes payable (4,923) 9,618
Increase in deferred income taxes payable - 1,636
Increase in accounts payable and accrued
expenses 3,350 61,512
Stock issued for services 3,500 8,886
Other (27,362) 13,281
-------- ------
Net Cash Provided by Operating Activities 44,497 193,639
-------- -------
Cash Flows from Investing Activities:
(Investments) in certificates of purchase (1,239,554) (1,721,256)
Proceeds from redemptions of certificates
of purchase 971,346 2,048,695
(Investment) in property (511) -
(Investment) in notes receivable (105,000) (326,206)
Collection of notes receivable 95,873 42,637
Other 140,755 100,298
-------- -------
Net Cash Provided by (Used in) Investing Activities (137,091) 144,168
--------- -------
Cash Flows from Financing Activities:
Proceeds from bank notes payable 810,100 -
(Repayment of) bank notes payable (749,628) (1,000,000)
(Repayment of) mortgage notes payable (5,295) (8,755)
(Repayment of) loan from related party - (150,000)
--------- ----------
Net Cash Provided by (Used in) Financing Activities 55,177 (1,158,755)
--------- -----------
(Decrease) in Cash (37,417) (820,948)
Cash, Beginning of Period 70,229 1,159,431
--------- ---------
Cash, End of Period $ 32,812 338,483
========== ==========
Interest Paid $ 41,948 $ 43,730
========== ==========
Income Taxes Paid $ 42,321 $ 14,524
========== ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
6
<PAGE>
ROCKY MOUNTAIN POWER CO.
AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
March 31, 1999
(Unaudited)
(1) Condensed Financial Statements
- ----------------------------------
The financial statements included herein have been prepared by
Rocky Mountain Power Co. without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in the
financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted as
allowed by such rules and regulations, and Rocky Mountain Power
Co. believes that the disclosures are adequate to make the
information presented not misleading. It is suggested that these
financial statements be read in conjunction with the June 30,
1998 audited financial statements and the accompanying notes
thereto. While management believes the procedures followed in
preparing these financial statements are reasonable, the accuracy
of the amounts are in some respect's dependent upon the facts
that will exist, and procedures that will be accomplished by
Rocky Mountain Power Co. later in the year.
The management of Rocky Mountain Power Co. believes that the
accompanying unaudited condensed financial statements contain all
adjustments (including normal recurring adjustments) necessary to
present fairly the operations and cash flows for the periods
presented.
7
<PAGE>
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Rocky Mountain Power Co. (the "Company") was organized as a Colorado
corporation on September 30, 1958. The Company is principally in the
real estate ownership and rental business. The Company also invests
in mortgage notes receivable and certificates of purchase related to
real estate foreclosures. Certain statements in the Report are
forward-looking. Actual results of future events could differ
materially.
The following discussion of the financial condition and results of
operations of the Company relates to the three (3) months ended March
31, 1999 and 1998 and the nine (9) months ended March 31, 1999 and
1998, and should be read in conjunction with the financial statements
and notes thereto included elsewhere in this Report. The Company was
a relatively inactive public shell corporation for the two years
preceding the business combination with Prime Rate Investment
Management Enterprises, Inc. (PRIME) effective March 31, 1997. Since
the controlling shareholders of PRIME control RMPC after the business
combination, the transaction was accounted for as a reverse
acquisition. The financial statements of PRIME are presented in this
filing since for accounting purposes PRIME is the acquiring entity.
Effective April 30, 1997, PRIME was merged into RMPC with Prime Rate
Income & Dividend Enterprises, Inc. (PRIDE), a wholly-owned subsidiary
of PRIME becoming a wholly-owned subsidiary of RMPC. PRIDE is the
operating company and RMPC is principally a holding company. The
Company has selected June 30 as its fiscal year end.
Results of Operations
- ---------------------
Revenue for the three and nine month periods ended March 31, 1999
decreased from the three and nine month periods ended March 31, 1998
as follows:
1998 1999 Decrease
-------- -------- --------
Three Months Ended March 31, $144,584 $ 48,855 $ 95,729
Nine Months Ended March 31, $268,258 $136,799 $131,459
Revenue decreased principally due to gains recognized on disposition
of assets. Gains recognized totaled $82,809 for the nine month period
ended March 31, 1998 as compared to $2,800 for the nine month period
ended March 31, 1999. Revenue also decreased due to a change in the
Company's business whereby it no longer does property inspections.
The revenue for property inspections totaled $27,769 and $50,969
during the three and nine month periods ended March 31, 1998. The
Company had no income from property inspections during the three and
nine month periods ended March 31, 1999. Rent income during the nine
month period ended March 31, 1999 was $14,910 as compared to $23,095
during the nine month period ended March 31, 1998, a decrease of
$8,385 due to a decrease in rental real estate owned.
8
<PAGE>
Operating expenses were $58,785 during the three month period ended
March 31, 1998 as compared to $10,100 during the three month period
ended March 31, 1999. Operating expenses were $160,672 during the
nine month period ended March 31, 1998 as compared to $33,355 during
the nine month period ended March 31, 1999. Operating expenses
decreased principally due to the ground lease cost of the
Racquetball/Health Club facility which totaled $9,705 and $23,366
during the three and nine month periods ended March 31, 1998,
respectively, and due to the decrease in contract services paid for
property inspections.
Net income after provision for income taxes amounted to $23,847 during
the three month period ended March 31, 1999 as compared to $70,151
during the three month period ended March 31, 1998, a decrease of
$46,304.
Net income after provision for income for the nine month period ended
March 31, 1999 was $66,046 as compared to $87,581 during the nine
month period ended March 31, 1998, a decrease of $21,535.
Liquidity and Capital Resources
- -------------------------------
Working capital was $1,014,605 at March 31, 1999 as compared to
953,149 at June 30, 1998. The Company's stockholders' equity was
$2,086,095 at March 31, 1999 as compared to $2,016,549 at June 30,
1998. The increase in stockholders' equity related principally to the
net income recognized for the nine months ended March 31, 1999.
The Company has made no commitments that would require any material
increase in capital resources. The Company's financial condition has
not been affected by the modest inflation of the recent past. The
Company believes that future inflation, if any, would not materially
affect the results of operations, other than interest rates on the
line of credit which are based on a floating rate over prime would be
higher. Also the values and rental rates on the Company's real estate
could be affected by future inflation, in any.
9
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None.
Item 2. Changes in Securities
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.
10
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
(Registrant) ROCKY MOUNTAIN POWER CO.
Date May 17, 1999
BY(Signature) /s/Michael L. Schumacher
Name and Title Michael L. Schumacher, Chief
Executive Officer and Principal Accounting
Officer
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-END> MAR-31-1999
<CASH> 32,812
<SECURITIES> 0
<RECEIVABLES> 443,610
<ALLOWANCES> 0
<INVENTORY> 917,722
<CURRENT-ASSETS> 1,452,818
<PP&E> 747,025
<DEPRECIATION> 11,011
<TOTAL-ASSETS> 2,583,028
<CURRENT-LIABILITIES> 438,213
<BONDS> 0
0
0
<COMMON> 608,916
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 2,583,028
<SALES> 0
<TOTAL-REVENUES> 48,855
<CGS> 0
<TOTAL-COSTS> 10,100
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 38,755
<INCOME-CONTINUING> 14,908
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 23,847
<EPS-DILUTED> .04
</TABLE>
