<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15 (d) of
Securities Exchange Act of 1934
For Period ended December 31, 1999
Commission File Number 0-26493
CORE SYSTEMS, INC.
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(Exact name of registrant as specified in its charter)
NEVADA 88-0390251
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(State of Incorporation) (I.R.S. Employer Identification No.)
12618 BIRCHBROOK COURT, POWAY, CA 92064
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(Address of Principal Executive Offices) (Zip Code)
(619) 699-1750
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(Registrant's telephone number, including area code)
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.
Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock at the latest practicable date.
As of December 31, 1999, the registrant had 3,069,000 shares of common stock,
$.001 par value, issued and outstanding.
<PAGE> 2
CORE SYSTEMS, INC.
(A Development Stage Company)
BALANCE SHEETS
UNAUDITED
ASSETS
<TABLE>
<CAPTION>
31-Dec 31-Dec
1999 1998
---------- ----------
<S> <C> <C>
CURRENT ASSETS
CASH 290 0
---------- ----------
TOTAL CURRENT ASSETS 290 0
FIXED ASSETS
---------- ----------
NET FIXED ASSETS 0 0
OTHER ASSETS
---------- ----------
TOTAL OTHER ASSETS 0 0
---------- ----------
TOTAL ASSETS 290 0
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
---------- ----------
TOTAL CURRENT LIABILITIES 0 0
LONG TERM LIABILITIES
---------- ----------
TOTAL LONG TERM LIABILITIES 0 0
---------- ----------
TOTAL LIABILITIES 0 0
STOCKHOLDERS' EQUITY
COMMON STOCK - 50,000,000 authorized, 3,069 0
3,069,000 issued
PAID IN CAPITAL 6,231 0
BEGINNING RETAINED DEFICIT (7,667) 0
NET LOSS (1,342) 0
---------- ----------
ENDING RETAINED DEFICIT (9,010) 0
---------- ----------
TOTAL STOCKHOLDERS' EQUITY 290 0
---------- ----------
TOTAL LIAB & STOCKHOLDERS' EQUITY 290 0
========== ==========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE> 3
CORE SYSTEMS, INC.
(A Development Stage Company)
INCOME STATEMENTS
UNAUDITED
<TABLE>
<CAPTION>
PERIOD ENDED PERIOD ENDED
12/31/99 12/31/98
---------- ----------
<S> <C> <C>
REVENUE
---------- ----------
TOTAL REVENUE 0 0
DIRECT COSTS
---------- ----------
TOTAL COST OF GOODS SOLD 0 0
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GROSS PROFIT 0 0
OPERATING EXPENSES
MANAGEMENT FEES 0 0
BANK FEES 45
OFFICE EXPENSE 297
LICENSES & FEES 1,000
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TOTAL OPERATING EXPENSES 1,342 0
---------- ----------
LOSS FROM OPERATIONS (1,342) 0
OTHER INCOME & EXPENSE
---------- ----------
TOTAL OTHER INCOME & EXPENSE 0 0
---------- ----------
LOSS BEFORE TAXES (1,342) 0
PROVISION FOR TAXES
---------- ----------
NET LOSS (1,342) 0
========== ==========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE> 4
CORE SYSTEMS, INC.
(a Development Stage Company)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED
UNAUDITED
<TABLE>
<CAPTION>
DEC 31 DEC 31
1999 1998
---------- ----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
NET LOSS (1,342) 0
ADJ TO RECONCILE NET INCOME (LOSS) TO NET
CASH USED IN OPERATING ACTIVITIES:
AMORTIZATION 0 0
CHANGES IN ASSETS AND
LIABILITIES 0 0
---------- ----------
NET CASH FLOWS FROM OPERATING ACTIVITIES (1,342) 0
CASH FLOWS FROM INVESTING ACTIVITIES:
ORGANIZATION COSTS 0 0
---------- ----------
NET CASH FLOWS FROM INVESTING ACTIVITIES 0 0
CASH FLOWS FROM FINANCING ACTIVITIES:
COMMON STOCK 3,069
PAID IN CAPITAL 6,231 0
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NET CASH FLOWS FROM FINANCING ACTIVITIES 9,300 0
NET INCREASE (DECREASE) IN CASH (1,342) 0
CASH AT BEGINNING OF PERIOD 1,632 0
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CASH AT END OF PERIOD 290 0
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
<PAGE> 5
FINANCIAL STATEMENTS (continued)
NOTES TO FINANCIAL STATEMENTS
1. MANAGEMENT'S OPINION
In the opinion of management, the accompanying financial statements contain all
adjustments necessary to present fairly the financial position of the company as
of December 31, 1999 and 1998, and the results of operations for the three
months ended December 31, 1999 and 1998, and the changes in cash for the three
months ended December 31, 1999 and 1998. The accompanying financial statements
have been adjusted as of December 31, 1999 as required by Item 310 (b) of
Regulation S-B to include all adjustments which in the opinion of Management are
necessary in order to make the financial statements not misleading.
2. INTERIM REPORTING
The results of operations for the three months ended December 31, 1999 and 1998,
are not necessarily indicative of the results to be expected for the remainder
of the year.
3. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Organization and Nature of Operations
The Company was incorporated in Nevada on February 19, 1997. The Company is a
development stage company and has not conducted any business activities to date.
4. Basis of Accounting
The Company's policy is to use the accrual method of accounting and to prepare
and present financial statements which conform to generally accepted accounting
principles. The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and reported amounts of revenues and expenses during the reporting
periods. Actual results could differ from those estimates.
5. Cash and equivalents
For purpose of the statements of cash flows, all highly liquid investments with
a maturity of three months or less are considered to be cash equivalents. There
were no cash equivalents as of December 31, 1999.
<PAGE> 6
FINANCIAL STATEMENTS (continued)
NOTES TO FINANCIAL STATEMENTS
6. Income Taxes
Income taxes are provided for using the liability method of accounting in
accordance with Statement of Financial Accounting Standards No. 109 (SFAS 109),
"Accounting for Income Taxes." A deferred tax asset or liability is recorded for
all temporary differences between financial and tax reporting. Deferred tax
expense (benefit) results from the net change during the year of deferred tax
assets and liabilities.
PART 1 FINANCIAL INFORMATION
Management's Plan of Operations
The Company maintains a cash balance sufficient to sustain corporate operations
until such time as Management can raise the funding necessary to advance its
business plan. The losses of $1342 through December 1999 were due to operating
expenses including licenses and fees and office expenses. Sales of the Company's
equity securities have allowed the Company to maintain a positive cash flow
balance.
Management's business plan calls for the Company to take the following steps to
offer its pipe restoration services in California: raise capital of $800,000 to
$1,000,000 through the sale of securities pursuant to a private placement during
the next six months, open one office in Los Angeles County during the second six
months with a budget of $120,000 in equipment, $30,000 in office equipment,
$20,000 in furniture & fixtures, $5,000 in supplies, $150,000 in direct labor
for plumbers, $40,000 in management salary, $20,000 in office salaries, $24,000
in rent, $50,000 in advertising, $10,000 in insurance, and $25,000 in other
operating expenses. The Company will begin bidding pipe restoration jobs in
month seven, with anticipated job starts in months nine through twelve. The
Company will utilize its own employees for all job contracts. Management
anticipates cash flow from job completions to begin near the end of month
twelve. The Company will face considerable risk in each of its business plan
steps, such as difficulty of renting adequate office facilities within its
budget, difficulty of hiring competent personnel within its budget, difficulty
in completing necessary personnel training within time limits, and a shortfall
of funding due to the Company's inability to raise capital in the equity
securities market. If no funding is received during the next twelve months, the
Company may be forced to reduce its business plan activities to focus on one or
a few local construction contracts, seek jobs that pay advance deposits and make
progress payments, reduce its planned employee hiring, and delay cash
expenditures for goods and services. If the Company could not resolve a possible
lack of funding through these steps, it would be forced to rely on its existing
cash in the bank and funds loaned by the directors and officers. The Company's
officers and directors have no formal commitments or arrangements to advance or
loan funds to the Company and no restrictions, limits, or interest rates have
been discussed or considered.
<PAGE> 7
PART II OTHER INFORMATION
ITEM 1 Not applicable.
ITEMS 2-4: Not applicable
ITEM 5: Information required in lieu of Form 8-K: None
ITEM 6: Exhibits and Reports on 8-K:
a) Exhibit # 27.1, "Financial Data Schedule"
b) No reports on Form 8-K were filed during the fiscal
quarter ended December 31, 1999
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.
Core Systems, Inc.
Dated: February 7, 2000 /s/ VIC BARGER
-------------------------------------
Vic Barger
President and Chief Executive Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM INTERIM
FINANCIAL STATEMENTS FOR FIRST QUARTER FISCAL 1999 AND 1998 AND IS QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO SUCH CORE SYSTEMS, INC. 10-QSB.
</LEGEND>
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 3-MOS
<FISCAL-YEAR-END> SEP-30-2000 SEP-30-1999
<PERIOD-START> OCT-01-1999 OCT-01-1998
<PERIOD-END> DEC-31-1999 DEC-31-1998
<CASH> 290 0
<SECURITIES> 0 0
<RECEIVABLES> 0 0
<ALLOWANCES> 0 0
<INVENTORY> 0 0
<CURRENT-ASSETS> 290 0
<PP&E> 0 0
<DEPRECIATION> 0 0
<TOTAL-ASSETS> 290 0
<CURRENT-LIABILITIES> 0 0
<BONDS> 0 0
0 0
0 0
<COMMON> 3,069 0
<OTHER-SE> 6,231 0
<TOTAL-LIABILITY-AND-EQUITY> 290 0
<SALES> 0 0
<TOTAL-REVENUES> 0 0
<CGS> 0 0
<TOTAL-COSTS> 0 0
<OTHER-EXPENSES> 1,342 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> (1,342) 0
<INCOME-TAX> 0 0
<INCOME-CONTINUING> (1,342) 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (1,342) 0
<EPS-BASIC> (.00) .00
<EPS-DILUTED> (.00) .00
</TABLE>
