SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-QSB-A
[X] Quarterly Report under Section 13 or 15(d) of the Securities Exchange Act
of 1934 for the Quarterly Period ended SEPTEMBER 30, 2000 or
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[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the Transition Period from _____________ to
____________
Commission File Number
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REMEDENT USA, INC
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(exact name of small business issuer as specified in its charter)
Nevada 86-0837251
-------------------------------- ----------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization.) Identification No.)
1220 Birch Way, Escondido, California 92027
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(Address of principal executive offices) (Zip Code)
(760) 781-3333
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(Issuer's telephone number)
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 CORPORATE ISSUERS)
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: As of 9-30-00 : 12,989,470 shares
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Transitional Small Business Disclosure Format (check one): Yes No X .
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<PAGE>
<TABLE>
<CAPTION>
REMEDENT USA, INC.
CONDENSED CONSOLIDATED
BALANCE SHEETS
(Unaudited)
ASSETS
September 30, March 31, 2000
2000 2000
------------------------------------------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 19,854 $ 8,125
Accounts receivable, net 16,254 40,897
Due from related parties 45,793 16,919
Inventories, net 112,594 153,712
Prepaid expenses 1,211 536
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TOTAL CURRENT ASSETS 195,706 220,189
Property and Equipment, net 26,278 31,795
OTHER ASSETS
Patents, net of accumulated amortization 27,644 28,274
Other assets 7,782 4,782
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TOTAL OTHER ASSETS 35,426 33,056
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TOTAL ASSETS $ 257,410 $ 285,040
==============================================================================================
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
September 30, March 31, 2000
2000
------------------------------------------
<S> <C> <C>
CURRENT LIABILITIES
Accounts payable $ 379,465 $ 396,208
Notes payable-related parties 153,120 37,096
Accrued salaries - officers 125,767 85,567
Accrued liabilities 171,108 154,110
Customer Deposits 8,892
Royalty payable 44,276 40,754
Current portion capital lease 575 1,629
Note payable-Union Bank 46,994 50,000
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Total current liabilities 921,305 774,256
Long Term Liabilities and Capital Leases, 0 0
net of current portion
--------------------------------------------------------------------------------------------------
TOTAL LIABILITIES 921,305 774,256
Stockholders'Equity (Deficit)
Common stock 12,989 12,685
Additional paid in capital 1,628,718 1,446,018
Prepaid services for stock 0 (12,983)
Accumulated deficit (2,305,602) (1,934,936)
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Total stockholders'equity (deficit) (663,895) (489,216)
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Total Liabilities and Stockholders' Equity $ 257,410 $ 285,040
(Deficit)
===============================================================================================
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
<PAGE>
<TABLE>
<CAPTION>
Remedent USA, Inc.
Statement of Operations (Unaudited)
Three months Six months
ending ending
September 30, September 30,
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2000 1999 2000 1999
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<S> <C> <C> <C> <C>
Revenues
Sales $ 42,261 $ 104,742 $ 242,314 $293,602
--------------------------------------------------------------------------------------------------------------
Total Revenue 42,261 104,742 242,314 293,602
Cost of Goods Sold 11,763 21,436 76,283 98,820
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Gross profit 30,498 83,306 166,031 194,782
Operating Expenses
Research and 15,160 18,580 30,245 28,711
development
Sales and 34,818 195,659 233,382 239,880
marketing
General and 66,440 73,923 141,879 191,228
administrative
Depreciation and 3,328 2,736 6,657 5,472
amortization
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Total operating 119,746 290,898 412,163 465,291
expenses
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Net (loss) from (89,248) (207,592) (246,132) (270,509)
operations
Other Income (Expenses)
Interest income 69 65 137 208
Interest expense (59,363) (1,733) (121,581) (3,042)
Other 2,254 (3,090)
income/expense
--------------------------------------------------------------------------------------------------------------
Total other income (57,040) (1,668) (124,534) (2,834)
(expenses)
--------------------------------------------------------------------------------------------------------------
Net (loss) before (146,288) (209,260) (370,666) (273,342)
taxes
State Income Taxes 0 0 0 0
--------------------------------------------------------------------------------------------------------------
Net (loss) $ (146,288) $(209,260) $(370,666) $(273,342)
================================================================----------------------------------------------
(Loss) per share (0.01) (0.02) (0.03) (0.02)
Weighted average 12,738,050 12,685,303 12,989,470 12,561,603
shares outstanding
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
<PAGE>
<TABLE>
<CAPTION>
Remedent USA, Inc.
Statement of Cash Flows
(Unaudited)
Six Months Ended September 30,
2000 1999
---------------------------------
<S> <C> <C>
Cash Flows From Operating Activities
Net loss $ (370,666) $ (273,342)
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 6,657 5,472
Stock for services 12,983 74,501
Beneficial Conversion Feature 103,200
Changes in:
Accounts receivable 24,643 (24,029)
Inventory 41,118 43,497
Prepaid expenses (675) (4,009)
Accounts payable 63,061 112,985
Accrued liabilities 57,198 41,416
Customer deposits (8,892) 0
Royalties payable 3,522 9,996
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Net Cash Used in Operating Activities (67,851) (13,513)
Cash Flows from Investing Activities
Patents (510)
Equipment (10,291)
Deposits (3,000)
Notes to related parties (28,874) (9,174)
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Net Cash (Used) Provided by Investing Activities (32,384) (19,465)
Cash Flows from Financing Activities
Lease payments (1,054) (1,006)
Proceeds of notes and debenture 116,024 8,563
Officer loans (repayments) 0 0
Note payments (3,006) 0
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Net Cash Provided by Financing Activities 111,964 7,557
Net Increase in Cash 11,729 (25,421)
Cash, beginning of the year 8,125 89,382
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Cash, September 30 19,854 $ 63,961
==========================================================================================================
Supplemental Non Cash Investing and Financing Activities:
The Company issued 304,167 shares of stock in lieu of paying an account
payable for $79,805.00.
Supplemental Information:
Interest paid $ 479 $ -
Taxes paid $ - $ -
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
<PAGE>
<TABLE>
<CAPTION>
Remedent USA, Inc.
Statement of Changes in Stockholders Equity (Deficit)
(Unaudited)
Common Stock Additional A/P Accumulated
Paid-in
Date Description Shares Dollars Capital Deficit Total
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
June 30, 2000 Balance 12,985,303 $ 12,985 $ 1,578,223 $(0) $ (2,159,314) $ (568,106)
------------------------------------------------------------------------------------------------------------------------------------
July 1, 2000 Shares for Services 4,167 $ 4 $ 496 $ 500
August 21, 2000 Debenture $ 15,000 $ 15,000
August 23, 2000 Debenture $ 5,000 $ 5,000
September 1, 2000 Debenture $ 5,000 $ 5,000
September 25, 2000 Debenture $ 25,000 $ 25,000
September 30,2000 Net Loss $ (146,288) $ (146,288)
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September 30, 2000 Balance 12,989,470 $ 12,989 $ 1,628,719 $(0) $(2,305,602) $ (663,894)
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</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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NOTE 1 CONDENSED FINANCIAL STATEMENTS
A. Disclosure
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. These financial statements should be read in
conjunction with the Form 10-SBA-A3 Filed January 17, 2001.
B. Management's Representation
The consolidated balance sheet as of September 30, 2000 and the consolidated
statement of operations for the three month and six-month periods ended
September 30, 2000 and September 30, 1999 and the statement of cash flows for
the six-month periods ended September 30, 2000 and 1999 have been prepared by
the Registrant, without audit. In the opinion of management, all adjustments
necessary to present fairly the financial position, results of operations, and
cash flows at September 30, 2000 and for all periods presented, have been made.
REMEDENT USA, INC.
NOTES TO FINANCIAL STATEMENTS
1. Basis of Preparation
The unaudited financial statements of Remedent USA, Inc. (the "Company""),
presented herein have been prepared in accordance with the instructions to Form
10-QSB and do not include all of the information and note disclosures required
by generally accepted accounting principles. These statements should be read in
conjunction with the financial statements and notes thereto included in our last
audited financial statements. These audited statements are contained in our FORM
10-SB for the year ended March 31, 2000 and have been filed with the Securities
and Exchange Commission.
In management's opinion, the accompanying financial statements include all
adjustments (consisting only of normal, recurring adjustments) necessary to
summarize fairly the financial position and results of operations for the three
months ended September 30, 2000 may not be indicative of the results that may be
expected for the full fiscal year.
2. Cash and Cash Equivalents
The Company considers all highly liquid investments with maturities of three
months or less to be cash equivalents.
3. Accounts Receivable
The Company sells premium toothbrushes to various companies, primarily to retail
chains located throughout the United States. The terms of sales are 2% 10 days,
net 30 days. Accounts receivable is reported at net realizable value and net of
allowance for doubtful accounts. As of September 30, 2000 and 1999 the allowance
for doubtful accounts was $3,000.
The Company uses the allowance method to account for uncollectible accounts
receivable. The Company's estimate is based on historical collection experience
and a review of the current status of trade accounts receivable. It is
reasonably possible that the company's estimate of the allowance for doubtful
accounts will change.
4. Inventories
Inventories are stated at lower of cost (weighted average) or market. Inventory
costs include material, labor and manufacturing overhead. Individual components
of inventory are listed below at September 30, 2000 and 1999 as follows:
2000 1999
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Inventory-Supplies $ 32,628 $ 5,397
Displays and Raw Materials $ 53,438 $ 43,257
Finished Goods $ 26,528 $ 78,984
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Total $ 112,594 $ 127,638
5. Patents
Patent costs are amortized using straight-line method over 15 years. Patent
values and accumulated amortization at September 30, 2000 and 1999 are as
follows:
2000 1999
----- ----
Patent $ 34,709 $ 34,199
Accumulated amortization $ 7,065 $ 4,785
--------- ----------
Patents, net $ 27,644 $ 29,414
6. Net Loss Per Share
Basic net loss per share is computed by dividing net loss by the weighted
average number of common shares outstanding during the period.
7. Impact of Recently Issued Accounting Standards
SFAS No.131 establishes standards for reporting information about operating
segments in financial statements issued to stockholders. It also establishes
standards for related disclosures about products and services, geographic areas
and major customers. Operating segments are defined as components of an
enterprise 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. The company's financial
reporting as well as the chief operating decision-maker, does not currently
provide or review information by segments. All financial information is
currently analyzed in the aggregate. The company is currently evaluating various
methods of segment reporting for the method which they believe will be most
useful to management.
In June 1998, the FASB issued Statement of Financial Accounting Standards (SFAS)
No. 133 (Accounting for Derivative Instruments and Hedging Activities), which
establishes accounting and reporting standards for derivative instruments. This
Statement requires that an entity recognize all derivatives as either assets or
liabilities in the statement of financial position and measure those instruments
at fair value. In June 1999, the FASB issued SFAS No. 137 (Accounting for
Derivative Instruments and Hedging Activities-Deferral of the Effective Date of
FASB Statement No. 133) which postponed the adoption date of SFAS No.133. as
such, the Company is not required to adopt the new statement until the year
2001. The Company is currently evaluating the effect that implementation of the
new standard will have on its operations and financial position.
8. Going Concern
The Company has sustained substantial net losses since its inception in
September 1996. In addition, as of September 30, 2000 the Company had a working
capital deficit totaling $725,599 and a shareholders deficit of $663,895. These
factors raise substantial doubt about the Company's ability to continue as a
going concern. The Company is currently working with various groups in an effort
to raise significant working capital and completion of the Company's marketing
plan.
9. Related Party Transactions
The Company's headquarters in California occupy approximately 1000 square feet
of Rebecca M. Inzunza's, an officer shareholder, primary residence that total's
4,000 square feet. Rent paid directly to Ms. Inzunza each monthly is currently
$655.
The Company has borrowed various amounts totaling $103,200 from several
stockholders to meet the current financial obligations of the Company. The notes
are unsecured, due on demand and include interest at 10% per annum. The Company
may continue to borrow from shareholders and officers to meet current financial
needs.
10. Other Information
In an effort to provide additional exposure of the Company's unique product, the
Company does provide, to certain first time buyers, all dental professional
customers, and all international customers, an opportunity to acquire the
product with certain special marketing discounts. The Company views these
discounts not as sales discounts but as a method of marketing its products to
customers that may not otherwise purchase the product. These discounts should be
deducted from sales to evaluate the exact sales number. Beginning April 1, 2001,
the accounting procedure for posting sales will reflect the actual sales price
and not the Company's standard blanket cost to all buyers.
<PAGE>
ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OEPRATIONS
OVERVIEW
Other than $50,000 raised through convertible debentures, our plans to
raise additional capital have not materialized and our ability to continue as a
going concern is in further jeopardy. Net sales decreased $62,481 for the three
months ending September 30, 2000 when compared to the three months ended
September 30, 1999, and decreased $51,288 for the six months ending September
30, 2000 when compared to the six months ended September 30, 1999. Net sales
were approximately $11,619 for the month of September 2000.
Total assets decreased by $27,630 from $285,040 at fiscal year ending
March 31, 2000 to $257,410 in September 30, 2000. Accounts receivable totaled
$16,254 on September 30, 2000 primarily due to lack of sales and the fact that
international sales are conducted on a cash basis only. Amounts due from related
parties increased $28,874 from $16,919 at fiscal year ending March 31, 2000 to
$45,793 for September 30, 2000. The increase in notes from related parties are
loans to three officers. One loan in the amount of $2,324 was paid in full as of
the filing of this 10QSB.
Inventory decreased $41,118 from $153,712 at fiscal year ending March
31, 2000 to $112,594 on September 30, 2000, due to minimal sales and the
continual replenishing of blister packaging only on an as needed basis.
Liabilities increased $147,049 when comparing $921,305 at September 30,
2000 to $774,256 at fiscal year ending March 31, 2000. Accounts payable
decreased $16,743 from $396,208 at fiscal year ending March 31, 2000 on
September 30, 1999 to $379,465 on September 30, 2000. This is primarily due to
increases in sales and marketing expenses.
Accrued liabilities increased by $16,998 due to accrued employee's
salaries, and interest. Royalties payable increased $3,522 or 9%, for the six
month period ending September 30, 2000 and is based on net sales.
The company is aggressively working towards a contingency marketing
plan that would involve turning marketing and distribution in its entirety over
to a well-established oral care distributing company. Several candidates have
been identified. The Company is currently negotiating with one such company,
Breath Asure, Inc. If the Company is successful in completing an agreement with
Breath Asure or similar company, advertising and all other such expenses would
no longer be a burden on the Company and other operating expenses would be
significantly reduced as well since the new distributing company would handle
all marketing, distribution and fulfillment activities. However, until such
contingency plan is finalized, our current marketing plan is effective but,
temporarily curtailed until we can raise sufficient capital to support it.
In further effort to reduce costs, Rebecca Inzunza has assumed
responsibilities of both CEO and CFO, replacing Steve Grassbaugh as our CFO.
Once the Company has adequate funding, a CFO will be hired.
RESULTS OF OPERATIONS
THREE MONTHS ENDED SEPTEMBER 30, 2000 AS COMPARED TO THE THREE
MONTHS ENDED SEPTEMBER 30, 1999
Net Sales. Our net sales for the three months ended September 30, 2000
totaled $42,261, compared to $104,742 for the three months ended September 30,
1999, reflecting a decrease of $62,481 or 60%. Our sales decrease occurred
primarily because our cash shortfall has made it virtually impossible to
purchase advertising, delays in implementing the market expansion plan including
redesign of the package. Additionally, as of July 31, 2000, we have temporarily
curtailed our marketing operations, which also caused a decrease in net sales.
Absent substantial additional funding, we expect that our sales will continue to
decline as we deplete our remaining inventories. For the three month period
ending September 30, 1999, international sales totaled $10,233 with $5,408 or
53% applied to promotional discounts compared to the three month period ending
September 30, 2000, which totaled $4,514 in international sales with promotional
discounts of $2,470 or 55% applied.
In an effort to provide additional exposure of the Company's unique
product, the Company does provide, to certain first time buyers, all dental
professional customers, and all international customers, an opportunity to
acquire the product with certain special marketing discounts. The Company views
these discounts not as sales discounts but as a method of marketing its products
to customers that may not otherwise purchase the product. Promotional discounts
for the three month period ending September 30, 2000 totaled $16,313, which is
included within sales and marketing expenses. This amount should be deducted
from sales to evaluate the exact sales number. Beginning April 1, 2001, the
accounting procedure for posting sales will reflect the actual sales price and
not the Company's standard blanket cost to all buyers.
Cost of goods sold. Cost of goods sold during the three months ended
September 30, 2000 totaled $11,763 or 28% of net sales, reflecting a decrease of
$9,673 or 45% over the comparable three months ending September 30, 1999. Our
cost of goods decrease is directly related to the decrease in sales. Our gross
margin was 72% for the three months ended September 30, 2000 compared to our
gross margin of 80% for the three months ended September 30, 1999. This increase
in percentage is directly related to the higher cost for the package redesign.
Operating expenses. Our sales and marketing expenses decreased to
$34,818 during the three months ended September 30, 2000 compared to $195,659
for the three months ending September 30, 1999. The largest component of our
sales and marketing expenses for the three months ended September 30, 2000 was
in advertising and promotional discounts. As a percentage of net sales, sales
and marketing expenses are 82% for the three months ended September 30, 2000, as
compared to 187% for the three months ended September 30, 1999. The percentage
decrease is primarily due to a reduction in sales and marketing expenses, sales,
and the slowing of the marketing expansion plan.
General and administrative expenses decreased to $66,440 for the three
months ended September 30, 2000 from $73,923 for the three months ended
September 30, 1999. The decrease is primarily due to a reduction in the
workforce and temporarily curtailing our marketing operations. As a percentage
of net sales, general and administrative expenses were 157% for the three months
ended September 30, 2000, as compared to 71% for the three months ended
September 30, 1999. The percentage increase is primarily attributable to a
reduction in sales.
Interest expense. Interest expense was $59,363 for the three months
ending September 30, 2000 as compared to $1,733 for the three months ended
September 30, 1999. The increase in interest expense for 2000 related
principally to $50,000 for one time interest expense accrual associated with the
convertible debentures
SIX MONTHS ENDED SEPTEMBER 30, 2000 AS COMPARED TO THE SIX
MONTHS ENDED SEPTEMBER 30, 1999
Net sales. Our net sales decreased to $242,314 for the six months ended
September 30, 2000 compared to $293,602 for the six months ended September 30,
1999, reflecting a decrease of $51,288 or 17%. The decrease was the result of
our cash shortfall, which has made it virtually impossible to implement the
marketing expansion plan. We expect our sales to decline without additional
substantial funding, as almost all of vendors who supply radio advertising have
ceased all services to us. Additionally, we have temporarily curtailed marketing
expansion plans, which have also caused a decrease in net sales. International
sales for the six month period ending September 30, 2000 totaled $149,683 with
promotional discounts of $86,147 or 58% applied as compared to the six month
period ending September 30, 1999, in which international sales totaled $16,253
with promotional discounts applied of $8,619 or 53%.
Cost of goods sold. Cost of goods sold during the six months ended
September 30, 2000 was $76,283 or 31% of net sales, reflecting a decrease of
$22,537 or 23%. Our cost of goods decrease is directly related to the decrease
in sales. Our gross margin was 69% of net sales for the six months ended
September 30, 2000 as compared to 66% of net sales for the six months ended
September 30, 1999.
Operating expenses. Our sales and marketing expenses decreased to
$233,382 during the six months ended September 30, 2000 from $239,880 for the
six months ended September 30, 1999. The decrease is due to increases in new
promotional literature, tradeshow fees, commissions, and advertising, and offset
with decreases in samples, consulting, promotional discounts, and public
relations. Sales and marketing expenses should fall even further during fiscal
third quarter. As a percentage of net sales, sales and marketing expenses were
96% for the six months ended September 30, 2000, as compared to 82% for the six
months ended September 30, 1999. As our sales decline, we expect that our sales
and marketing expenses will increase as a percentage of our sales.
General and administrative expenses decreased to $141,879 for the six
months ended September 30, 2000 from $191,228 for the six months ended September
30, 1999. This decrease is due our efforts to downsize and economize operations
wherever possible. The primary components for the six month ending September 30,
2000 of the decrease were employee salaries, officer's salaries, insurance,
royalties, and rent. As a percentage of sales, general and administrative
expenses were 59% for the six months ended September 30, 2000, as compared to
65% for the six months ended September 30, 1999. As our sales decline, we expect
that our general and administrative expenses will increase as a percentage of
our sales. The decreases in officer's salaries were due to the elimination of
the Company's CFO. Payroll taxes also decreased during the six-month period
September 30, 2000.
During the six months ended September 30, 2000, our lack of working
capital forced us to downsize our operations and reduce the number of employees.
As a result of our inability to return to the Bulletin Board, and to obtain
additional capital, we believe that our ability to continue as a going concern
is in jeopardy.
Interest expense. Interest expense was $121,581 for the six months
ended September 30, 2000, as compared to $3,042 for the six months ended
September 30, 1999. The increase in interest expense is related principally to
$50,000 for the one time interest expense accrual for the convertible debentures
obtained during the fiscal second quarter and $53,200 obtained in the fiscal
first quarter for a total of $103,200. The additional interest is for officers
and employee salaries accruing, credit cards, and loans from related parties.
LIQUIDTY AND CAPITAL RESOURCES
Current situation. Our ability to continue as a going concern is in
jeopardy. As of November 30, 2000 we had approximately $10,000 of cash. Our
inventory is low and in need of replenishing to fill orders. An increasing
number of creditors have placed us with collection agencies. We are not paying
vendors timely and virtually all vendors have placed us on credit hold until the
Company has paid them in full. In addition, because we are unable to timely pay
our creditors, we face a possibility of lawsuits and other threats of legal
action seeking payment.
We historically financed our operations primarily through sales and
loans. Primary uses of cash have been to fund our operation to date. If we are
successful in achieving revenue growth, our working capital requirement is
likely to increase. However, more recently, we have been unable to raise cash
through any source.
During the three month period ending September 30, 2000, the Company
borrowed $50,000 from various shareholders in the form of convertible
debentures. The debentures are unsecured and bear interest at 10% per annum. The
debentures are due on demand and if no demand is made before the maturity dates,
the debentures can be converted to stock at 37.5% of the average trading price
30 days before maturity. The Company has recorded interest expense of $50,000 as
part of the conversion feature of the debenture.
-------------------------------- ---------------- --------------------
Date of Debenture Amount of Maturity Date
Debenture
-------------------------------- ---------------- --------------------
August 21, 2000 $ 15,000 August 21, 2001
-------------------------------- ---------------- --------------------
August 23, 2000 $ 5,000 August 23, 2001
-------------------------------- ---------------- --------------------
September 1, 2000 $ 5,000 September 1, 2001
-------------------------------- ---------------- --------------------
September 25, 2000 $ 25,000 September 25, 2001
-------------------------------- ---------------- --------------------
TOTAL $ 50,000
-------------------------------- ---------------- --------------------
Net cash provided by our operating expenses during the six months ended
September 30, 2000 was $67,851 as compared to $13,513 used during the six months
ended September 30, 1999. Net cash used by operating activities during the six
months ended September 30, 2000 was primarily the result of the loss for the
first six months, offset by the beneficial conversion feature of the debentures
and increases in accounts payable and accrued liabilities. We continue verbal
communications with vendors on an open basis, keeping them abreast of our
activities and as a result, no legal actions have developed in their effort to
collect past due amounts from the Company.
Revenues for the six months and three months ended September 30, 2000
decreased by $51,288 or 17% and $62,481 or 60%, respectively, over the
comparable periods a year earlier. Decrease in revenue was primarily due to a
decrease in sales.
Net losses from continuing operations for the six and three months ended
September 30, 2000 decreased $24,377 and increased $62,972 respectively.
OTHER INFORMATION
As stated in or 10SB registration statement, we have a contingency
marketing plan that involves working with existing oral care companies to
essentially become their premium toothbrush provider. On November 7, 2000,
Remedent received a Letter Of Intent from California based Breath Asure, Inc.
The letter states that Breath Asure wants negotiations to begin immediately that
will ultimately result in Breath Asure taking over worldwide distribution and
marketing of Remedent Tooth and Gumbrush, either directly or via a joint venture
with Remedent USA, Inc.
As of January 11, 2001 negotiations with Breath Asure, Inc. continue.
Management anticipates a mutually beneficial agreement will be reached very
soon. The Company has identified another distributing company candidate that has
expressed interest in Remedent. Should an agreement with Breath Asure not
materialize, the Company will aggressively move towards negotiations with the
new candidate.
QUARTERLY TRENDS
We do not anticipate significant "seasonal" changes in our operation.
Our product is a toothbrush that people use on a daily basis for oral hygiene
and as such, we predict that although sales may increase over the year, sales
will not be affected by quarterly trends.
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits filed with this Form 10-QSB:
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K filed during the period covered by this Form 10-QSB:
None
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
Remedent USA, Inc.
--------------------------------------------------------
(Registrant)
/s/ Rebecca Inzunza
--------------------------------------
Rebecca Inzunza
CEO, President,
and Director
Date: January 17, 2001
