Form 10-QSB
(As last amended in Release No. 33-7505, effective January 1,1999, 63 F.R. 9632)
U. S. Securities and Exchange Commission
Washington, D.C. 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 APRIL 30, 2000
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( ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
For the transition period from...............to....................
Commission file number........................................
Jupiter Marine International Holdings, Inc.
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(Exact name of small business issuer as
specified in its charter)
Florida 65-0794113
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
3391 S. E. 14th Avenue, Port Everglades, FL 33316
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(Address of principal executive offices)
954-523-8985
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(Issuer's telephone number)
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(Former name, former address and former fiscal year, if changed since last
report)
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 ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Exchange Act after
the distribution of securities under a plan confirmed by court.
Yes [ ] 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: 4,033,500
Transitional Small Business Disclosure Format (check one):
Yes [ ] No [X]
<PAGE>
JUPITER MARINE INTERNATIONAL HOLDINGS, INC.
Part 1. Financial Information
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Item 1. Financial Statements
Balance Sheet................................................. 3
Statement of Operations....................................... 5
Statement of Cash Flows....................................... 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations........................... 7
Part II. Other Information
-------- -----------------
ITEM 6. Exhibits and Reports on Form 8-K............................. 10
Signatures.................................................... 11
2
<PAGE>
JUPITER MARINE INTERNATIONAL HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
APRIL 30, 2000 AND APRIL 30, 1999
<TABLE>
<CAPTION>
ASSETS
April 30, 2000 April 30, 1999
-------------- --------------
<S> <C> <C>
CURRENT ASSETS:
Cash $ 279,521 $ 167,011
Accounts receivable 36,997 --
Inventories 416,735 399,997
Prepaid expenses 6,115 8,272
---------- ----------
Total current assets 739,368 575,280
PROPERTY AND EQUIPMENT, at cost or allocated cost
Boat molds 1,029,124 822,181
Leasehold improvements 138,566 97,837
Machinery and equipment 126,449 34,847
Office equipment 10,112 7,000
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1,304,251 961,865
Less accumulated depreciation 416,467 236,171
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Total property and equipment 887,784 725,694
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OTHER ASSETS:
Deposits 30,510 20,000
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Total other assets 30,510 20,000
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Total assets $1,657,662 $1,320,974
========== ==========
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<PAGE>
LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES
Accounts payable $ 363,510 $ 41,522
Payroll taxes payable -- 63,125
Accrued expenses 123,729 74,022
Customer deposits 28,124 199,194
Current portion of debt 50,000
Warranty reserve 56,005 49,084
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571,368 476,947
LONG TERM DEBT, less current portion 350,000 350,000
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Total liabilities 921,368 826,947
STOCKHOLDER'S EQUITY:
Capital stock, 5,000,000 shares of $.001
par value preferred stock authorized,
500,000 shares designated as 10% cumulative
Series A preferred stock, $.001 par value
($328,000 aggregate liquidation preference),
328,000 shares issued and outstanding 328 328
Capital stock, 205,000 shares designated as
as 10% cumulative Series B preferred stock,
$.001 par value ($205,000 aggregate
liquidation preference), 205,000 shares
issued and outstanding 205 205
Capital stock, 228,000 shares designated as
as 10% cumulative Series C preferred stock,
$.001 par value ($228,000 aggregate
liquidation preference), 228,000 shares
issued and outstanding 620 --
Capital stock, 50,000,000 shares of $.001
par value common stock authorized,
4,033,500 shares issued and outstanding 4,034 4,034
Additional paid-in capital 1,902,113 1,357,068
Accumulated deficit (1,171,006) (867,608)
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Total stockholder's equity 736,294 494,027
Total liabilities and stockholder's equity $ 1,657,662 $ 1,320,974
=========== ===========
</TABLE>
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<PAGE>
JUPITER MARINE INTERNATIONAL HOLDINGS, INC. AND SUBSIDIARY 0
CONSOLIDATED STATEMENT OF OPERATIONS (LOSS)
<TABLE>
<CAPTION>
Three months Three months Nine months Nine months
ended ended ended ended
April 30, 2000 April 30, 1999 April 30, 2000 April 30, 1999
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
NET SALES $ 1,857,607 $ 182,864 $ 4,143,548 $ 182,864
COST OF SALES 1,540,220 125,683.00 3,484,979 125,683
----------- ----------- ----------- -----------
Gross income 317,387 57,181 658,569 57,181
SELLING, GENERAL AND 295,173 363,135 768,112 625,668
ADMINISTRATIVE EXPENSES ----------- ----------- ----------- -----------
Profit (Loss) from operations 22,214 (305,954) (109,543) (568,487)
OTHER EXPENSE:
Interest expense 8,750 9,167 26,663 19,937
----------- ----------- ----------- -----------
Total other expense 8,750 9,167 26,663 19,937
Profit (Loss) before income taxes 13,464 (315,121) (136,206) (588,424)
PROVISION FOR INCOME TAXES -- -- -- --
Net Profit (Loss) $ 13,464 $ (315,121) $ (136,206) $ (588,424)
=========== =========== =========== ===========
Earnings (loss) per common share
Basic $ 0.001 $ (0.148) $ (0.015) $ (0.276)
=========== =========== =========== ===========
Earnings (loss) per common share
Diluted $ 0.001 $ (0.148) $ (0.013) $ (0.276)
=========== =========== =========== ===========
</TABLE>
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<PAGE>
JUPITER MARINE INTERNATIONAL HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED APRIL 30, 2000 AND APRIL 30, 1999
<TABLE>
<CAPTION>
Nine months Nine months
ended ended
April 30, 2000 April 30, 1999
-------------- --------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (136,206) $ (588,424)
adjustments to reconcile net loss to
net cash (used) provided by operating activities:
Provision for depreciation 143,646 149,283
Changes in assets and liabilities:
(Increase) decrease in accounts receivable (35,261) 411
(Increase) Decrease in inventories 4,456 (69,187)
(Increase) decrease in prepaid expenses 5,635 7,113
(Increase) decrease in other assets (6,510) (20,000)
Increase (decrease) in accounts payable 217,029 21,952
Decrease (increase) in payroll tax payable (33,125) 16,026
Increase in accrued expenses 40,852 41,973
(Decrease) increase in customer deposits (220,262) 43,005
Increase in warranty reserve 5,452 --
Decrease in other liabilities -- (604,406)
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Net cash (used in) provided by
operating activities (14,294) (1,002,254)
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CASH FLOWS FROM INVESTING ACTIVITIES:
Payment for purchase of property and equipment (261,201) (92,984)
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Net cash used in investing activities (261,201) (92,984)
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CASH FLOWS FROM FINANCING ACTIVITIES:
(Payment) proceeds in debt (50,000) 105,000
Proceeds from stock transactions 545,665 1,154,710
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Net cash provided from financing activities 495,665 1,259,710
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Net increase (decrease) in cash 220,170 164,472
CASH, Beginning of period 59,351 2,539
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CASH, End of period $ 279,521 $ 167,011
=========== ===========
</TABLE>
6
<PAGE>
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
General
Management's discussion and analysis contains various "forward-looking
statements" within the meaning of the Securities and Exchange Act of 1934. Such
statements consist of any statement other than a recitation of historical fact
and can be identified by the use of forward-looking terminology such as "may,"
"expect," "anticipate," "estimate" or "continue" or use of negative or other
variations or comparable terminology.
The Company cautions that these statements are further qualified by
important factors that could cause actual results to differ materially from
those contained in the forward-looking statements, that these forward-looking
statements are necessarily speculative, and there are certain risks and
uncertainties that could cause actual events or results to differ materially
from those referred to in such forward-looking statements.
Comparison of the results of operations for the quarter and nine months
ended April 30, 2000 to the quarter and nine months ended April 30, 1999 would
not be meaningful as the Company did not commence normal business operations
until May of 1999. The time from August 1, 1998 until April 30, 1999 was devoted
to reorganizing the Company, moving its manufacturing facility from Jupiter,
Florida to Port Everglades Florida, updating the new manufacturing facility and
producing boats that were an assumed liability of Jupiter 31, Inc.
Acquisition
During the quarter ended April 30, 2000 the Company, through its
subsidiary, Phoenix Yacht Corporation, acquired the molds and tooling for
Phoenix Marine's 34' and 38' models along with the Phoenix trademark in an all
cash transaction. Phoenix marine is a 24-year-old manufacturer of offshore
sportfishing boats located in Hialeah, Florida.
The new Phoenix 35' and 38' flybridge convertible models will be built
in the Company's Port Everglades, Florida manufacturing facility and will be
distributed through the Company's established dealer organization.
Plan of Operations
Management's operating plan for the fiscal year ending July 31, 2000 is
to be at a slight loss. Sales are expected to be about $5,339,000 with a gross
margin of approximately $1,080,000 (20.2%). Selling, general and administrative
expenses are projected to be approximately $1,100,000.
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<PAGE>
Net Sales
The Company's net sales for the quarter ended April 30, 2000 (the third
quarter of the fiscal year ending July 31, 2000) were $1,857,607, approximately
$523,000 better than expectations. The demand for the Company's products
remained strong during the third quarter and has continued into the fourth
quarter. The Company has ten dealers with 13 selling locations.
Cost of Products Sold
The gross income for the quarter was $317,387, 17.1% of net sales. The
percentage of net sales has shown improvement throughout the year. Manufacturing
techniques have continued to improve, as the production crew became more
familiar with the manufacturing process. Overhead spending was better than
expectations when based on a percentage of sales.
Selling, General and Administrative Expenses
Selling, general and administrative expenses of $295,173 for the
quarter ended April 30, 2000 were $67,962 less than the similar quarter of last
year. For the nine months ended April 30, 2000 expenses were $768,112 compared
to $695,668 for the first nine months of last fiscal year. As stated previously,
the Company devoted the majority of fiscal year 1999 to reorganizing the
Company, consequently selling, general and administrative expenses were below
fiscal year 2000.
Equity Financing
During the quarter ended January 31, 2000 the Company commenced a private
placement of Series C Cumulative Preferred Stock at a price of $1.00 per share.
The maximum offering is 1,250,000 shares. As of April 30, 2000 the Company sold
619,860 shares with net proceeds of $539,279. The closing date was extended to
May 31, 2000. The proceeds from this offering will be used for inventory,
tooling and demonstration models, repayment of indebtedness, sales, marketing,
web-site development and working capital.
8
<PAGE>
Liquidity and Capital Resources
The Company, since its inception, has experienced severe negative cash
flows and has met its cash requirements by issuing, through private placements,
its common and preferred stock. Additional funds were generated by borrowings of
$350,000. The Company anticipates that funds received from these sources, cash
generated from operations and additional financing, as mentioned above, should
be sufficient to satisfy the Company's contemplated cash requirements for at
least the next 12 months. After such time, the Company anticipates that cash
generated from operations will be sufficient to fund its operations, although
there can be no assurances that this will be the case.
The Company does not anticipate any significant purchase of equipment
in the near future. The number and level of employees at April 30, 2000 should
be adequate to fulfill the production schedule for its Jupiter boat line.
Additional employees will have to be hired as the Phoenix line starts
production.
9
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits required by Item 601 of Requlation S-B
The following exhibits are filed as part of this report:
Exhibits:
(27.1) Financial Data schedule
(b) Reports on Form 8-K
(i) None
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<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934,
the Registrant caused this Report to be signed on its behalf by the undersigned,
thereunto duly authorized.
JUPITER MARINE INTERNATIONAL
HOLDINGS, INC.
Date: June 14, 2000 By:/s/Carl Herndon
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Carl Herndon, Director, CEO and President
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