Xedar Corporation
2500 Central Avenue
Boulder, CO 80301
August 13, 1999
Securities and Exchange Commission
Washington, D.C. 20549
Pursuant to the requirements of the Securities Exchange
Act of 1934, we are transmitting herewith the attached
Form 10Q.
Sincerely,
Hans R. Bucher
Hans R. Bucher, President
UNITED STATES
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 June 26, 1999
_________________________________
( ) TRANSITION REPORT UNDER SECTION 13 or 15(d) OF THE EXCHANGE ACT
For the transition period from to
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Commission File Number 0-8356
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XEDAR CORPORATION
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(Exact name of small business issuer as specified in its charter)
Colorado 84-0684753
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(State or other jurisdiction of
incorporation or organization) (IRS Employer Identification No.)
2500 Central Avenue, Boulder, CO 80301
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(Address of principal executive offices)
(303) 443-6441
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(Issuer's telephone number)
Check whether the Issuer (1) filed all documents and 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 No
X
----- -----
State the number of shares outstanding of each of the issuer's classes
of common stock as of the latest practicable date: No Par Value Common
Stock - 1,837,224 shares as of August 6, 1999.
Transitional Small Business Disclosure Format (check one):
Yes No
X
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XEDAR CORPORATION
INDEX
Page No.
PART I Financial Information
Item 1 Financial Statements
Condensed Balance Sheets,
December 26, 1998 and June 26, 1999 1
Condensed Statements of Operations, six
months and three months ended June 27, 2
1998 and June 26, 1999
Condensed Statements of Cash Flows - six
months ended June 27, 1998 and 3
June 26, 1999
Notes to Condensed Financial Statements 4
Item 2 Management's Discussion and Analysis of Financial
Condition and Results of Operations 5
PART II Other Information 7
SIGNATURES 8
PART I - FINANCIAL INFORMATION
XEDAR CORPORATION
CONDENSED BALANCE SHEETS
December 26, 1998 and June 26, 1999
ASSETS
1998 1999
(Unaudited)
Current assets
Cash and cash equivalents $ 828,445 652,619
Trade accounts receivable, net 43,826 2,074
Interest receivable 5,000 -
Inventories 33,551 61,351
Prepaid expenses 4,669 1,840
Total current assets 915,491 717,884
Long term receivable from related party 154 521 148,560
Property and equipment, at cost 141,307 141,307
Less accumulated depreciation 118,930 123,298
22,377 18,009
Patents, net 13,517 13,517
$1,105,906 $897,970
========== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable-trade $ 9,281 $ 13,218
Accounts payable-related party 4,048 4,048
Accrued liabilities
Vacation 38,877 33,193
Payroll and commissions 6,960 6,182
Payroll and other taxes 3,039 1,887
Total current liabilities 62,205 58,528
Stockholders' equity
Common stock 1,617,617 1,617,617
Additional paid-in capital 40 40
Accumulated deficit (573,956) (778,215)
Total stockholders' equity 1,043,701 839,442
$1,105,906 $ 897,970
========== =========
The accompanying notes are an integral part of these condensed
financial statements.
-1-
XEDAR CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
Six Months Ended Three Months Ended
June 27, 1998 June 27, 1998
June 26, 1999 June 26, 1999
----------------- ------------------
1998 1999 1998 1999
Sales $ 37,200 $ 34,317 $ 31,260 $ 9,427
Cost of sales 132,708 140,735 76,339 68,536
Gross loss (95,508)(106,418) (45,079) (59,109)
Research and development costs 63,463 34,400 21,400 34,400
Selling, general and
administrative expenses 106,416 78,768 37,453 37,576
169,879 113,168 58,853 71,976
Operating loss (265,387)(219,586) (103,932)(131,085)
Other income 26,028 15,327 16,329 7,112
Net loss $(239,359) $(204,259) $(87,603)$(123,973)
========== ========== ======== ==========
Weighted average shares
outstanding 1,837,224 1,837,224 1,837,224 1,837,224
Basic and diluted loss
per common share $( .13) $( .11) $( .05) $( .06)
======= ======= ======= =======
The accompanying notes are an integral part of these condensed
financial statements.
-2-
XEDAR CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended
June 27 and June 26
-------------------
1998 1999
-------------------
Net loss $(239,359)$(204,259)
Adjustments to reconcile net loss
to net cash used by operating
activities
Depreciation of property and
equipment 6,060 4,368
(Increase) decrease in assets
Trade accounts receivable (36,183) 41,752
Note receivable 95,000 -
Interest receivable 1,000 5,000
Inventories 278 (27,800)
Refundable income taxes 3,206 -
Prepaid expenses 2,326 2,829
Increase (decrease) in liabilities
Accounts payable-trade 21,562 3,937
Accounts payable-related party (2,243) -
Accrued vacation 865 (5,684)
Accrued payroll (1,668) (778)
Payroll and other taxes 947 (1,152)
--------- ---------
Net cash used by operating (148,209) (181,787)
activities --------- ---------
Cash flows from investing
activities
Capital expenditures (15,446) -
Long term receivable-related
party 5,544 5,961
--------- --------
Net cash provided (used) by
investing activities (9,902) 5,961
Net decrease in cash and cash
equivalents (158,111) (175,826)
Cash and cash equivalents at
beginning of period 1,084,315 828,445
---------- ---------
Cash and cash equivalents at
end of period $ 926,204 $ 652,619
========== =========
The accompanying notes are an integral part of these condensed financial
statements.
-3-
XEDAR CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
June 26, 1999
(Unaudited)
NOTE 1: BASIS OF PRESENTATION
The condensed financial statements included herein are unaudited.
In the opinion of management, all adjustments, consisting of normal
recurring accruals, have been made which are necessary for a fair
presentation of the financial position of the Company at June 26,
1999 and the results of operations for the six months and three months
ended June 26, 1999 and June 27, 1998. Quarterly results are not
necessarily indicative of expected annual results. For a more complete
understanding of the Company's operations and financial position,
reference is made to Management's Discussion and Analysis of Financial
Condition and Results of Operations herein and the financial statements
of the Company, and related notes thereto, filed with the Company's
annual report on Form 10-KSB for the year ended December 26, 1998,
previously filed with the Securities and Exchange Commission.
NOTE 2: INVENTORIES
At June 26, 1999 inventories consisted of:
Raw materials $ 4,345
Work in process 57,006
----------
TOTAL $ 61,351
==========
NOTE 3: BASIC AND DILUTED LOSS PER COMMON SHARE
Basic and diluted loss per common share amounts were computed by
dividing the net loss by the weighted average number of shares
outstanding for the period. No options or warrants with a dilutive
effect were outstanding during the periods ended June 26, 1999
and June 27, 1998.
-4-
XEDAR CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Sales and Gross Profit (Loss)
Sales by product line for the first six months and three months 1998 and
1999 were:
(Amounts in $000)
Six Months Ended Three Months Ended
June 27 June 26 Increase June 27 June 26 Increase
1998 1999 (Decrease) 1998 1999 (Decrease)
Commercial products $ 1 $ 6 $ 5 $ - $ 5 $ 5
Design and development
contracts 36 28 (8) 31 4 (27)
----- ---- ------ ----- ----- ------
Totals $ 37 $ 34 $ (3) $ 31 $ 9 $ (22)
===== ==== ====== ===== ===== ======
Xedar product sales were $6,000 in the second quarter 1999 for repairs
only. The sales potential for the tube-based infrared cameras is non-
existent and the Company no longer offers this product. At this time,
the Company is not offering any standard product into the imaging
market, but is concentrating on development of special purpose imaging
systems for OEM and scientific applications.
Design and development contract sales decreased by $8,000 for the six
months ended June 26, 1999 as compared to the six months ended June 27,
1998. The Company is pursuing several contract opportunities with
various potential customers and has received a contract for a small
color camera for one prototype and delivery of eighty units over a
period of twelve months and another contract for sixty units with
delivery of eight units a month.
The gross profit for the second quarter 1999 was negative due to limited
sales volume and underabsorption of overhead costs.
Research and Development
A total of $34,000 was expended for the six months ended June 26,
1999 as compared to $63,000 for the same period in 1998. The funds
were used to develop special purpose imaging systems for OEM and
scientific applications.
Selling, General and Administrative Expenses: Selling, general and
administrative expenses decreased by $28,000 in the first six months of
1999 as compared to the same period in 1998. This decrease is primarily
due to lower marketing and support costs, due to reduced marketing
staff.
-5-
XEDAR CORPORATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (Continued)
LIQUIDITY AND CAPITAL RESOURCES
The Company finances its current activities from cash reserves and
operations. At June 26, 1999 the Company's working capital was
$659,000.
The Company's liquidity position is necessary to maintain its ability
to conduct in-house research and development enabling it to compete in
single customer contracts and to develop a commercial product line in a
highly volatile high technology market place.
YEAR 2000 ISSUE
The Company has assessed "Year 2000" issues within each of its
significant computer systems and applications and concluded that the
software being utilized is not date sensitive and adequately recognizes
a four digit year. The Company has not identified any mission critical
systems which are not expected to be compliant or cannot be circum-
vented manually.
The failure to correct a material Year 2000 problem could result in an
interruption in, or failure of, certain normal business activities or
operations. Such failures could materially and adversely affect the
Company's operations, liquidity and financial condition. Due to the
general uncertainty inherent in the Year 2000 problem, resulting in part
from the uncertainty of the Year 2000 readiness of third party
suppliers, the Company is unable to determine at this time whether the
consequences of Year 2000 failures will have a material impact on the
Company's operations, liquidity or financial condition. The Company has
not expended any money to rectify Year 2000 issues and does not expect
to incur any such expenses in the future.
FORWARD-LOOKING STATEMENTS
Except for the historical information contained herein, the matters set
forth in this 10-QSB are forward-looking statements within the meaning
of the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. These forward-looking statements are subject to
risks and uncertainties that may cause actual results to differ
materially. These risks are detailed from time to time in the Company's
periodic reports filed with the Securities and Exchange Commission,
including the Company's Annual Report on Form 10-KSB, Quarterly Reports
on Form 10-QSB and other periodic filings. These forward-looking
statements speak only as of the date hereof. The Company disclaims any
intent or obligation to update these forward-looking statements.
-6-
PART II - OTHER INFORMATION
NOT APPLICABLE
-7-
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.
XEDAR CORPORATION
- -----------------------------
(Registrant)
August 13, 1999 Hans R. Bucher
Date......................... ...................................
(Hans R. Bucher, President)
-8-
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