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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 2000
-----------------
[] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ________________ to _______________
Commission File No. 000-30105
-------------
PAWNBROKERS EXCHANGE, INC.
(Exact name of Small Business Issuer as specified in its charter)
Utah 84-1421481
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
158 South State Street
Salt Lake City, Utah 84111
- -------------------------------------------- --------------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code (801) 238-0111
------------------
Indicate by check mark 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 reports), and (2) has been subject to such filing
requirements for the past 90 days. [X] Yes [ ] No
Indicate the number of shares outstanding of each of the Issuer's
classes of common stock, as of the latest practicable date.
Class Outstanding as of March 31, 2000
- ------------------------- --------------------------------------
NO PAR VALUE COMMON STOCK 2,149,000 SHARES
<PAGE>
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements.
BASIS OF REPRESENTATION
General
The accompanying unaudited financial statements have been prepared in
accordance with the instructions to Form 10-QSB and, therefore, do not include
all information and footnotes necessary for a complete presentation of financial
position, results of operations, cash flows and stockholders' equity (deficit)
in conformity with generally accepted accounting principles. In the opinion of
management, all adjustments considered necessary for a fair presentation of the
results of operations and financial position have been included and all such
adjustments are of a normal recurring nature. Operating results for the quarter
ended March 31, 2000, are not necessarily indicative of the results that can be
expected for the year ending December 31, 2000.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The Company is engaged in the business of pawnbrokering.
Sales for the three months ended March 31, 2000 were $43,476 compared
to $42,882 for the prior year. Cost of sales were $17,169 for the three months
ended March 31, 2000 compared with $17,442 for the prior year.
Sales in 2000 include about $7,900 of service charge income collected
on pawns and about $35,600 from retail sales ($6,600 and $36,300 in 1999).
Expenses were $59,498 for the three months ended March 31, 2000,
compared with $40,723 for the prior year. The main increase in 2000 was for
outside services.
During 2000, the Company borrowed $25,000 from related parties to help
provide working capital. The Company hopes to be able to increase sales to
provide working capital in the future.
Impact of the Year 2000 Issue
The "Year 2000 problem" arose because many existing computer programs
use only the last two digits to refer to a year. Therefore, these computer
programs do not properly recognize a year that begins with "20" instead of the
familiar "19". If not corrected, many computer applications could fail or create
erroneous results. The extent of the potential impact of the Year 2000 problem
is not yet known, and if not timely corrected, it could affect the global
economy.
The Company has not experienced any computer problems related to Y2K.
2
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
99.1 Financial Statements as of March 31, 2000
27 Financial Data Schedule
(b) Reports on Form 8-K
None.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Issuer has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PAWNBROKERS EXCHANGE, INC.
Dated: May 9, 2000
Michael Vardakis, President and Director
3
<PAGE>
PAWNBROKERS EXCHANGE, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
2000 1999
------------------ ------------------
(Unaudited) (Audited)
ASSETS
CURRENT ASSETS
<S> <C> <C>
Cash $ 3,954 $ 4,151
Pawns receivable 24,371 28,014
Inventory 60,971 60,349
------------------ ------------------
TOTAL CURRENT ASSETS 89,296 92,514
Property & equipment 31,002 33,039
------------------ ------------------
$ 120,298 $ 125,553
================== ==================
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable $ 10,398 $ 7,640
Accrued expenses 4,397 7,838
Loan Payable 10,000 10,000
Accrued expenses - related parties 37,469 33,750
Franchise tax payable 0 100
Loans payable - related parties 77,000 52,000
------------------ ------------------
TOTAL CURRENT LIABILITIES 139,264 111,328
------------------ ------------------
TOTAL LIABILITIES 139,264 111,328
SHAREHOLDERS' EQUITY (DEFICIT)
Common stock no par value, 50,000,000 shares authorized;
2,149,000 shares issued 191,372 191,372
Deficit accumulated during development stage (210,338) (177,147)
------------------ ------------------
TOTAL SHAREHOLDERS' EQUITY (DEFICIT) (18,966) 14,225
------------------ ------------------
$ 120,298 $ 125,553
================== ==================
</TABLE>
F-1
<PAGE>
PAWNBROKERS EXCHANGE, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Period
from
7/9/97
Three Months Ended (Date of
March 31, inception) to
2000 1999 3/31/00
------------- ------------- ------------------
<S> <C> <C> <C>
Sales $ 43,476 $ 42,882 $ 320,429
Cost of Sales 17,169 17,442 121,861
------------- ------------- ------------------
GROSS PROFIT 26,307 25,440 198,568
Expenses:
General and Administrative expenses:
Advertising 1,200 6,552 30,546
Bank charges 230 211 2,019
Depreciation 2,037 1,981 17,921
Insurance 1,118 1,091 3,789
Interest 250 0 250
Interest - related parties 3,719 3,120 38,469
Miscellaneous overhead 3,051 857 11,715
Office supplies 1,325 774 16,326
Outside services 16,090 35 32,041
Payroll and payroll taxes 16,380 15,162 123,803
Property taxes 3,798 347 11,032
Rent - related party 9,000 9,000 99,000
Repairs 217 74 9,592
Utilities 1,083 1,519 12,103
------------- ------------- ------------------
59,498 40,723 408,606
------------- ------------- ------------------
(LOSS) BEFORE INCOME TAXES (33,191) (15,283) (210,038)
PROVISION FOR INCOME TAXES 0 0 300
------------- ------------- ------------------
NET (LOSS) $ (33,191) $ (15,283) $ (210,338)
============= ============= ==================
(LOSS) PER COMMON SHARE
Net (loss) per weighted average common
share outstanding $ (.02) $ (.01)
============= =============
Weighted average number of common
shares outstanding 2,149,000 2,095,300
============= =============
</TABLE>
F-2
<PAGE>
PAWNBROKERS EXCHANGE, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Period
from
7/9/97
Three Months Ended (Date of
March 31, inception) to
2000 1999 3/31/00
------------- ------------- ------------------
OPERATING ACTIVITIES
<S> <C> <C> <C>
Net (loss) $ (33,191) $ (15,283) $ (210,338)
Adjustments to reconcile net (loss) to net cash required
by operating activities:
Depreciation 2,037 1,981 17,921
Changes in:
Pawns receivable 3,643 (4,077) (24,371)
Inventory (622) (7,116) (60,971)
Franchise tax payable (100) (100) 0
Accounts payable and accrued expenses 3,036 7,961 52,264
------------- ------------- ------------------
NET CASH REQUIRED BY OPERATING ACTIVITIES (25,197) (16,634) (225,495)
INVESTING ACTIVITIES
Purchase of equipment 0 0 (48,923)
------------- ------------- ------------------
NET CASH USED IN INVESTING ACTIVITIES 0 0 (48,923)
FINANCING ACTIVITIES
Stock sold 0 10,478 191,372
Loan 0 0 10,000
Loans - related parties 25,000 0 152,000
Loan repayments - related parties 0 0 (75,000)
------------- ------------- ------------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 25,000 10,478 278,372
------------- ------------- ------------------
NET INCREASE (DECREASE) IN CASH (197) (6,156) 3,954
CASH AT BEGINNING OF YEAR 4,151 8,798 0
------------- ------------- ------------------
CASH AT END OF PERIOD $ 3,954 $ 2,642 $ 3,954
============= ============= ==================
SUPPLEMENTAL INFORMATION Cash paid for:
Interest $ 0 $ 0 $ 1,000
Income taxes 100 0 300
</TABLE>
F-3
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted
from Pawnbrokers Exchange, Inc. March 31, 2000 financial
statements and is qualified in its entirety by reference to
such financial statements.
</LEGEND>
<CIK> 0001069563
<NAME> Pawnbrokers Exchange, Inc.
<CURRENCY> US
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<EXCHANGE-RATE> 1.00
<CASH> 3,954
<SECURITIES> 0
<RECEIVABLES> 24,371
<ALLOWANCES> 0
<INVENTORY> 60,971
<CURRENT-ASSETS> 89,296
<PP&E> 48,923
<DEPRECIATION> 17,921
<TOTAL-ASSETS> 120,298
<CURRENT-LIABILITIES> 139,264
<BONDS> 0
0
0
<COMMON> 191,372
<OTHER-SE> (210,338)
<TOTAL-LIABILITY-AND-EQUITY> 120,298
<SALES> 43,476
<TOTAL-REVENUES> 43,476
<CGS> 17,169
<TOTAL-COSTS> 17,169
<OTHER-EXPENSES> 59,498
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,969
<INCOME-PRETAX> (33,191)
<INCOME-TAX> 0
<INCOME-CONTINUING> (33,191)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (33,191)
<EPS-BASIC> (.02)
<EPS-DILUTED> (.02)
</TABLE>
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