<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 1O-QSB
Annual Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quaffer Ended March 31, 2000
Commission File No.
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CENTRE CAPITAL CORPORATION
(Exact name of Registrant as specified in its chaffer)
Nevada 87-0385103
State of Incorporation (I.R.S. Employer Identification Number)
2619 Gravel Drive, Ft. Worth, Texas 76118
(Address of Principal Executive Offices-zip code)
(817) 595-0919
(Registrant's telephone number, including area code)
Indicate by check mark whether Registrant (10 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 Registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
(1) Yes X No (2) Yes X No
--- --- --- ---
As of March 31, 2000, Registrant had outstanding 10,042,052 shares of
Common Stock.
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CENTRE CAPITAL CORPORATION
FORM 10-QSB
QUARTER ENDED MARCH 31, 2000
INDEX
<TABLE>
<S> <C>
PART I FINANCIAL INFORMATION
Item 1 Financial Information
Condensed Balance Sheets as of March 31, 2000 and
September 30, 1999
Condensed Statement of Operations for the quarter ended
March 31, 2000
Condensed Statement of Operations for the six months ended
March 31, 2000
Condensed Statement of Cash Flows for the six months ended
March 31, 2000
Notes to Condensed Financial Statements
Item 2 Management's Discussion and Analysis of Financial Condition
and Results of Operations
PART II OTHER INFORMATION
Item 1 Legal Proceedings
Item 2 Changes in Securities
Item 3 Defaults Upon Senior Securities
Item 4 Submission of Matters to Vote of Security Holders
Item 5 Other Information
ITEM 1. FINANCIAL STATEMENTS
</TABLE>
2
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CENTRE CAPITAL CORPORATION
CONDENSED BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
March 31 September 30
2000 1999
<S> <C> <C>
ASSETS
Current assets:
Inventory $ 66,132 $ 141,381
Deposits 830 830
----------- -----------
Total current assets 66,962 142,211
Property & equipment (net) 593,509 598,525
----------- -----------
Other assets 415 707
----------- -----------
TOTAL ASSETS $ 660,886 $ 741,443
=========== ===========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities:
Bank overdraft $ 44,074 $ 57,302
Notes payable 1,302,198 400,000
Loans from officers 81,700 159,500
Other current liabilities 12,203 560,766
----------- -----------
Total current liabilities 1,440,375 1,177,568
Stockholders' deficit:
Common stock, $0.001 par value
50,000,000 shares authorized;
10,042,052 issued and outstanding 10,042 10,042
Additional paid in capital 170,391 170,391
Accumulated deficit (959,722) (616,558)
----------- -----------
Total stockholders' deficit (779,289) (436,125)
----------- -----------
TOTAL LIABILITIES AND
STOCKHOLDERS' DEFICIT $ 660,886 $ 741,443
=========== ===========
</TABLE>
See notes to condensed financial statements.
3
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CENTRE CAPITAL CORPORATION
CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
For the Quarter Ended March 31, 2000
<TABLE>
<S> <C>
Sales - net of returns & allowances $ 135,347
Cost of sales 100,399
-----------
Gross margin 34,948
Operating expenses
General and administrative 56,385
-----------
Total operating expenses 56,385
-----------
Interest expense 8,000
-----------
Loss before income tax $ (29,437)
-----------
Provision for income taxes --
Net loss $ (29,437)
===========
Loss per share $ (0.00)
Weighted average shares outstanding 1,042,052
</TABLE>
See notes to condensed financial statements.
4
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CENTRE CAPITAL CORPORATION
CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
For the Six Months Ended March 31, 2000
<TABLE>
<S> <C>
Sales - net of returns & allowances $ 221,662
Cost of sales 175,287
-----------
Gross margin 46,375
Operating expenses
Leased employees 179,901
General and administrative 193,638
-----------
Total operating expenses 373,539
-----------
Interest expense 16,000
-----------
Loss before income tax $ (343,164)
-----------
Provision for income taxes --
Net loss $ (343,164)
===========
Loss per share ($0.03)
Weighted average shares outstanding 1,042,052
</TABLE>
See notes to condensed financial statements.
5
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CENTRE CAPITAL CORPORATION
CONDENSED STATEMENT OF CASH FLOWS
(UNAUDITED)
For the Six Months Ended March 31, 2000
<TABLE>
<S> <C>
Cash flows from operating activities:
Net loss (343,164)
Adjustments to reconcile net loss to
Net cash used by operating activities
Depreciation and amortization 10,061
Changes in working capital:
Decrease in inventory 75,249
Decrease in accounts payables (100,000)
Decrease in other current liabilities (448,563)
Total cash used by operating activities (806,417)
Cash flows from investing activities:
Purchase equipment (4,864)
---------
Total cash used by investing activities (4,864)
Cash flows from financing activities:
Repayment of loan from officers (80,000)
Proceeds from loan from officer 2,200
Proceeds from notes payable 902,309
---------
Net cash provided by financing activities 824,509
---------
Net increase in cash 13,228
Cash overdraft at beginning of the quarter (57,303)
Cash overdraft at end of quarter $ (44,074)
=========
</TABLE>
See notes to condensed financial statements.
6
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CENTRE CAPITAL CORPORATION
NOTES TO UNAUDITED CONDENSED FINANCIAL STATEMENTS
NOTE A - UNAUDITED CONDENSED FINANCIAL STATEMENTS:
The accompanying condensed financial statements were prepared by management
without audit. These financial statements have not been examined by independent
public accountants. Management believes that these financial statements present
fairly, in all material respects, the information set forth therein. However,
certain disclosures required by generally accepted accounting principles have
been omitted or condensed. These financials statements should be read in
conjunction with the Form 10-KSB for the initial eight months ended September
30, 1999.
NOTE B - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
History:
The Company was organized February 1, 1999, as a Nevada corporation named Vista
InterNatural Products 1, Inc. ("VIP"). Effective June 1, 1999 VIP merged with
Centre Capital Corporation ("Centre"), ("the Merger").
Centre was incorporated in Nevada on September 6, 1988 for the purpose of
exchanging stock with Burke Oil Company ("Burke"), a Utah corporation. Centre
acquired the controlling block (in excess of 60%) of the stock of Burke. Centre
was dormant at that time, and never activated or operated Burke. Centre's
charter was allowed to be forfeited in May, 1991 for non payment of Utah
franchise taxes.
In January, 1996 Centre issued 500,000 shares of its common stock for all of the
outstanding shares of KFA, Inc. ("KFA"). KFA marketed a non-toxic insecticide
designed primarily for the extermination of fire ants. Centre sold all of its
shares of KFA to a shareholder of Centre in May, 1999.
In connection with the Merger, Centre effected a one for three reverse stock
split its common shares. Centre then issued one share for every two shares of
VIP common stock to the shareholders of VIP in exchange for 100% of the
outstanding shares of VIP.
The Merger, a purchase under Accounting Principles Board Opinion 16, has been
accounted for as a reverse merger with VIP being the acquirer. Therefore, VIP's
historical financial statements are now the Company's historical financial
statements.
Basis of Accounting:
It is the Company's policy to prepare its financial statements on the accrual
basis of accounting in conformity with generally accepted accounting principles.
Sales are recorded as income in the period in which they are earned and expenses
are recognized in the period in which the related liability is incurred.
Revenue Recognition:
Revenue is recognized when payment is received and product is shipped. Sales are
reported net of returns and allowances.
Cash and Cash Equivalents:
For purposes of the statement of cash flows, the Company considers all highly
liquid debt instruments with a maturity of three months or less to be cash
equivalents. The Company places its cash investments in more than one high
quality financial institutions.
Fair Value of Financial Instruments:
The carrying value of cash, receivables and accounts payable approximates fair
value due to the short maturity of these instruments.
7
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NOTE B - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(CONTINUED):
Property:
Property is stated at cost. Upon retirement or disposal, the asset cost and
related accumulated depreciation are removed from the accounts and any resulting
gain or loss is included in the determination of net income. Depreciation is
computed by the straight line method over the following estimated useful lives.
<TABLE>
<S> <C>
Buildings .............................................. 40 years
Office furniture ....................................... 7 years
Equipment .............................................. 5 years
Software ............................................... 3 years
</TABLE>
Expenditures for maintenance, repairs and renewals are charged to expense when
incurred. Additions and significant improvements are capitalized and
depreciated.
Loss per Common Share:
Loss applicable to common share is based on the weighted average number of
shares of common stock outstanding during the period.
Accounting Estimates:
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make certain estimates and
assumptions that affect the amount reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
Long-lived Assets:
Generally accepted accounting principals require recognition of impairment of
long-lived assets in the event of net book value of such assets exceed the
future undiscounted cash flows attributable to such assets. Consequently, the
Company assesses its assets annually for impairment and writes down any amounts
necessary as a result of the assessment
Income Tax:
The Company uses an asset and liability approach for the accounting and
financial reporting of income tax. Under this method, deferred tax assets and
liabilities are determined based on temporary differences between the financial
carrying amounts and the tax bases of assets and liabilities using enacted tax
rates in effect in the years in which the temporary differences are expected to
reverse.
NOTE C - CONCENTRATIONS:
Product warranty: The Company offers a money back guarantee on all products sold
for a period of one year. During the six months ended March 31, 2000 recorded
$8,556 in returned products.
8
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NOTE D - INVENTORY:
The Company purchases a finished product and maintains an inventory stated at
cost. The Company uses the first in first out method in valuing its inventory.
All damaged and unmarketable product is reflected in cost of sales.
NOTE E - PROPERTY:
Property consists of the following:
<TABLE>
<S> <C>
Land ......................................................... 130,000
Building...................................................... 420,000
Office furniture ............................................. 10,634
Equipment..................................................... 45,103
Software ..................................................... 3,189
-------
608,926
Less accumulated depreciation ................................ 15,417
-------
Total ................................................. $593,509
========
</TABLE>
Depreciation for the six months ended March 31, 2000 amounted to $9,881.
Land and Building:
In August, 1999 the registrant purchased land and 2 buildings located in Duncan,
Oklahoma to be used as an office and distribution and storage facility. $50,000
was paid down at closing. The registrant also incurred a payable in the amount
of $100,000 for ninety days bearing no interest. The balance of $400,000 is
included in notes payable. This note bears interest at 8% per annum and is due
August 20, 2000.
NOTE F - OTHER ASSETS:
Organization Costs:
Organization costs in the amount of $1,957 are amortized over sixty months using
the straight-line method. Amortization expenses amounted to $180 during the six
months ended March 31, 2000 and the total accumulated amortization at March 31,
2000 is $1,542.
NOTE G - RELATED PARTY TRANSACTIONS:
Certain shareholders of the Company have advanced cash to the Company and also
paid expenses and acquired equipment on the Company's behalf. These advances are
included in notes payable and total $902,198.
9
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NOTE H - STOCKHOLDERS' EQUITY:
Preferred stock: The Company is authorized to issue 20,000,000 shares of
preferred stock at a par value of $0.001 per share. There were no shares issued
and outstanding as of March 31, 2000.
Common stock: The Company is authorized to issue 50,000,000 common shares of at
a par value of $0.001 per share. These shares have full voting rights. There
were 10,042,052 shares issued and outstanding as of March 31, 2000.
The Registrant has not paid a dividend to its stockholders.
NOTE I-LEASED EMPLOYEES:
The Registrant uses a third party to employee all personnel including one
officer of the Registrant. This third party leases the personnel to the
Registrant for a premium of approximately 15% of gross wages paid.
NOTE J- INCOME TAXES:
The Company has net operating loss carryforwards of approximately $600,000 at
March 31, 2000 that is available to offset future income tax liability.
Approximately $137,000 is net operating losses acquired as a result of the
merger. No deferred tax asset has been recognized for the operating loss
carryforward as any valuation allowance would reduce the benefit to zero. These
losses begin to expire in 2009.
ITEM 2. MANAGEMENT'S DISCUSSION AMD ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Registrant formed its corporation on February 1, 1999. It had acquired
most of the assets from an existing Oklahoma corporation and has continued to do
business as Vista InterNatural Products 1, Inc. The registrant has considerable
knowledge and experience in the area of multi-level marketing of nutritional
supplements and body care products.
PRODUCTS:
The Registrant currently offers a full line of leading edge nutritional
supplements, personal care, home and auto, and pest control products of the
highest quality. Several of these products are of a proprietary nature and are
manufactured exclusively for the Registrant. The Registrant is continually
seeking new leading edge products to add to its already successful product line.
The Registrant directly contracts with independent manufacturers to produce its
products in accordance with highest quality standards attainable. There are
several qualified manufacturers available to the Registrant to produce and
package the products sold. All dietary and nutritional supplements are produced
in licensed pharmaceutical laboratories for maximum quality control.
10
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The Registrant is also developing supplier relationships that will give
first priority for its packaging in order to supply quality packaging in short
notice situations. This feature will greatly benefit the Registrant as it
increases inventory to match its anticipated rapid growth.
Several of the key ingredients are kept on hand to avoid costly supply
delays.
The Registrant anticipates its inventory requirements on a ninety day
forward requirement. The Registrant also carries a substantial quantity of
preprinted packaging products to avoid unnecessary delays.
Registrant incurred a loss in the amount of $343,164 for the six month
period ended March 31, 2000. These losses were anticipated as the Registrant
demanded that the level of quality and service be maintained at a high standard
experienced by management. Cost of sales in the amount of $175,287 comprised of
product purchases, commissions, contract labor, and freight was approximately
79% of sales which is comparable to enterprises in the same industry and similar
size. Operating expenses such as leased employees and general and administrative
expenses amounted to $373,539 for the six months. As sales increase with
expansion the operating expenses should be increase only slightly and place the
registrant in a profitable position.
Revenue:
Revenue is from the sale of nutritional supplements and body care
products sold through its network of distributors. The company also receives
additional income through a referral arrangement that it has developed.
Cost of sales:
For the six months ended March 31, 2000, cost of sales totaling
$175,287 consisted of the following:
<TABLE>
<S> <C>
Purchases and inventory sold 76,242
Commissions and contract labor 90,427
Freight 8,618
-------
Total 175,287
=======
Operating expenses:
Operating expenses totaling $373,539 for the six months consisted of
the following:
Lease employees 179,901
General and administrative 193,638
-------
Total 373,539
=======
Liquidity and Capital Resources:
</TABLE>
11
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The registrant has financed its operations since inceptions by cash
advances by several individuals.
MARKET ANALYSIS:
The Registrant sells products that are in high demand by the general
public. The market for these and similar products grows by 50,000 people per
week in the United States. The Registrant competes with other products and
providers with quality, service, price, and guarantees. The Registrant has
numerous experts throughout the industry seeking quality leading edge products
to promote through its network of trained distributors.
A Look to the Future:
The Registrant has relied on financing from certain individuals to fund
its operations and acquisition of property. There are also financial commitments
from these and other individuals who believe very strongly in the dynamic future
growth of the company. Management believes that it can issue new shares of
common stock to retire all major debt.
The products are priced reasonably to the consumer and provide the
company with a very favorable profit margin. Many of the Registrant's products
are listed with the FDA and directly compete with health care products that cost
many times the price of ours and ours are often found to provide better results.
The Registrant is looking for quality distributors to market its
products and hopes to substantially increase its distributor base within one
year. The registrant is currently distributing products in 22 states and plans
to be in 22 more before the end of the next fiscal year.
During the second quarter the Registrant initiated an incentive program
that allows any distributor to earn new vehicles and other prizes by recruiting
other distributors and attaining certain sales goals. This incentive program is
titled the Wheel Deal and is expected to expand the operations of the Registrant
considerably.
ITEM 3. LEGAL PROCEEDINGS
No legal proceedings are pending by or against Registrant or their directors,
officers or affiliates, and to Registrant's knowledge no such legal proceedings
are threatened.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF STOCKHOLDERS
No current matters are pending that would require it to be submitted to the
stockholders for a vote.
ITEM 5. OTHER INFORMATION
12
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SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934, the
Registrant caused this Form 10QSB to be signed on its behalf by the undersigned
hereunto duly authorized, this 15th day of May, 2000. Centre Capital
Corporation.
/s/ CATHERINE JACOBS By: /s/ KARL JACOBS
-------------------- ---------------------
Catherine Jacobs/ Karl Jacobs
Chief Financial Officer Chairman of the Board
<PAGE> 14
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
<S> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-2000
<PERIOD-START> OCT-01-1999
<PERIOD-END> MAR-31-2000
<CASH> (66,132)
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 66,132
<CURRENT-ASSETS> 6,696
<PP&E> 608,926
<DEPRECIATION> 15,417
<TOTAL-ASSETS> 660,886
<CURRENT-LIABILITIES> 1,440,375
<BONDS> 0
0
0
<COMMON> 10,042
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 660,886
<SALES> 221,662
<TOTAL-REVENUES> 221,661
<CGS> 175,287
<TOTAL-COSTS> 175,287
<OTHER-EXPENSES> 373,539
<LOSS-PROVISION> (343,164)
<INTEREST-EXPENSE> 16,000
<INCOME-PRETAX> (343,164)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (343,164)
<EPS-BASIC> (0.03)
<EPS-DILUTED> (0.03)
</TABLE>
