UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended September 30, 1999
OR
[ ] 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 000-26377
OXIR INVESTMENTS, INC.
(Exact name of small business issuer as specified in its charter)
California 88-0397134
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3980 Howard Hughes Parkway, Suite 340, Las Vegas, Nevada 89109
(Address of principal executive offices)
Registrant's telephone no., including area code: (702) 369-4260
Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
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.
Class Outstanding as of November 2, 1999
Common Stock, no par value 21,182,200
TABLE OF CONTENTS
Heading Page
PART I. FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements. . . . . . . . . . . . 1
Consolidated Balance Sheets -- September 30,
1999 and June 30, 1999 . . . . . . . . . . . . . . . . 2
Consolidated Statements of Operations -- three
months ended September 30, 1999 and 1999 . . . . . . . 4
Consolidated Statements of Stockholders' Equity. . . . . 5
Consolidated Statements of Cash Flows -- three
months ended September 30, 1999 and 1999 . . . . . . . 6
Notes to Consolidated Financial Statements . . . . . . . 8
Item 2. Management's Discussion and Analysis and
Results of Operations. . . . . . . . . . . . . . . . . 9
PART II. OTHER INFORMATION
Item 1. Legal Proceedings. . . . . . . . . . . . . . . . . . . . 11
Item 2. Changes In Securities. . . . . . . . . . . . . . . . . . 11
Item 3. Defaults Upon Senior Securities. . . . . . . . . . . . . 11
Item 4. Submission of Matters to a Vote of
Securities Holders . . . . . . . . . . . . . . . . . . 11
Item 5. Other Information. . . . . . . . . . . . . . . . . . . . 11
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . 11
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . 12
-i-
PART I
Item 1. Financial Statements
The following unaudited Financial Statements for the period
ended September 30, 1999, have been prepared by the Company.
OXIR INVESTMENTS, INC.
FINANCIAL STATEMENTS
September 30, 1999 and June 30, 1999
OXIR INVESTMENTS, INC. AND SUBSIDIARIES
(A Development Stage Company)
Consolidated Balance Sheets
ASSETS
September 30, June 30,
1999 1999
(Unaudited)
CURRENT ASSETS
Cash and cash equivalents $ 113,255 $ 52,627
Investment in trading securities 3,025,403 4,672,246
Prepaid expenses 3,969 3,978
Total Current Assets 3,142,627 4,728,851
PROPERTY AND EQUIPMENT 5,774,282 4,013,222
OTHER ASSETS
Investment 300,000 -
Related party receivable 8,080 8,080
Deposits 15,000 15,000
Total Other Assets 323,080 23,080
TOTAL ASSETS $ 9,239,989 $ 8,765,153
OXIR INVESTMENTS, INC. AND SUBSIDIARIES
(A Development Stage Company)
Consolidated Balance Sheets (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
September 30, June 30,
1999 1999
(Unaudited)
CURRENT LIABILITIES
Accounts payable $ 25,680 $ 39,121
Margin account 1,562,409 1,981,464
Client funds payable 1,499,512 1,252,131
Provision for income taxes 413,970 398,760
Deferred tax liability 547,530 550,134
Current portion - mortgage payable 1,326 1,303
Total Current Liabilities 4,050,427 4,222,913
LONG-TERM LIABILITY
Mortgage payable 206,154 206,492
Total Long-Term Liability 206,154 206,492
Total Liabilities 4,256,581 4,429,405
COMMITMENTS
STOCKHOLDERS' EQUITY
Common stock: 50,000,000 shares authorized of no
par value, 21,150,600 and 21,090,600 shares issued
and outstanding, respectively 2,798,769 2,498,769
Retained earnings 2,184,639 1,836,979
Total Stockholders' Equity 4,983,408 4,335,748
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 9,239,989 $ 8,765,153
OXIR INVESTMENTS, INC. AND SUBSIDIARIES
(A Development Stage Company)
Consolidated Income Statements
(Unaudited)
From
Inception on
For the May 19,
Three Months Ended 1998 Through
September 30, September 30,
1999 1998 1999
SALES $ - $ - $ -
COST OF GOODS SOLD - - -
GROSS MARGIN - - -
COSTS AND EXPENSES
Depreciation expense 37,353 477 77,528
Rent expense 19,813 - 53,961
General and administrative 911,648 119,885 1,386,231
Total Costs and Expenses 968,814 120,362 1,517,720
Net Loss From Operations (968,814) (120,362) (1,517,720)
OTHER INCOME (EXPENSE)
Interest expense (55,261) - (140,161)
Realized gain on sale of
marketable securities 918,814 - 2,612,901
Net unrealized gain on
marketable securities 465,527 - 2,190,991
Dividends - - 128
Total Other Income (Expense) 1,329,080 - 4,663,859
INCOME (LOSS) BEFORE TAXES 360,266 (120,362) 3,146,139
INCOME TAX 12,606 - 961,500
NET INCOME (LOSS) $ 347,660 $ (120,362) $ 2,184,639
BASIC INCOME (LOSS) PER SHARE $ 0.02 $ (0.03)
FULLY DILUTED INCOME (LOSS)
PER SHARE $ 0.02 $ (0.03)
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING 21,100,000 4,500,000
OXIR INVESTMENTS, INC. AND SUBSIDIARIES
(A Development Stage Company)
Consolidated Statements of Stockholders' Equity
Common Stock Retained
Shares Amount Earnings
Balance at inception - $ - $ -
Net income from inception on May 19,
1998 through June 30, 1998 - - -
Balance, June 30, 1998 - - -
Shares issued to founders at
predecessor cost of $0.00 per share 13,770,000 - -
Shares issued for trading securities
at $0.70 per share 1,350,000 939,764 -
Common stock issued for cash at
$1.00 per share 600,000 600,000 -
Stock issuance costs - (250,000) -
Common stock issued for cash
at $5.00 per share 100,600 503,000 -
Common stock issued for related
party acquisitions, recorded at
predecessor cost 5,270,000 706,005 -
Net income for the year ended
June 30, 1999 - - 1,836,979
Balance, June 30, 1999 21,090,600 2,498,769 1,836,979
Common stock issued for services
at $5.00 per share (unaudited) 60,000 300,000 -
Net income for the three months ended
September 30, 1999 (unaudited) - - 347,660
Balance, September 30, 1999
(unaudited) 21,150,600 $ 2,798,769 $ 2,184,639
<PAGE>
OXIR INVESTMENTS, INC. AND SUBSIDIARIES
(A Development Stage Company)
Consolidated Statements of Cash Flows
(Unaudited)
From
Inception on
For the May 19,
Three Months Ended 1998 Through
September 30, September 30,
1999 1998 1999
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ 347,660 $ (120,362) $ 2,184,639
Adjustments to reconcile net income
(loss) to net cash provided by
operating activities:
Depreciation expense 37,353 477 77,528
Stock issued for services 300,000 - 300,000
Changes in assets and liabilities:
(Increase) decrease in prepaid expenses 9 - (3,969)
(Increase) in related party receivables - - (8,080)
(Increase) in deposits - (115,000) (15,000)
Increase (decrease) in accounts payable (13,443) 11,000 18,939
Increase in accrued liabilities 259,381 - 266,121
Increase in provision for income taxes 12,606 - 961,500
Net Cash Provided by Operating Activities 943,566 (223,885) 3,781,678
CASH FLOWS FROM INVESTING ACTIVITIES
Investment in bank (300,000 - (300,000)
(Increase) decrease in trading securities 1,646,845 - (330,919)
Increase in margin account (431,055) - 842,270
Purchase of property and equipment (1,798,413) (102,663) (2,642,457)
Net Cash Used by Investing Activities (882,623) (102,663) (2,431,106)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable - - 208,000
Payments on notes payable (315) - (520)
Stock issuance costs - (250,000) (250,000)
Common stock issued for cash - 600,000 1,103,000
Advances to related parties - - (2,337,867)
Cash from subsidiaries - - 40,070
Net Cash Provided (Used) by
Financing Activities $ (315) $ 350,000 $ (1,237,317)
OXIR INVESTMENTS, INC. AND SUBSIDIARIES
(A Development Stage Company)
Consolidated Statements of Cash Flows (Continued)
(Unaudited)
From
Inception on
For the May 19,
Three Months Ended 1998 Through
September 30, September 30,
1999 1998 1999
NET INCREASE IN CASH AND CASH
EQUIVALENTS $ 60,628 $ 23,452 $ 113,255
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 52,627 - -
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 113,255 $ 23,452 $ 113,255
SUPPLEMENTAL CASH FLOW
INFORMATION
Cash paid for:
Interest $ 43,261 $ - $ 121,421
Income taxes $ - $ - $ -
Schedule of Non-Cash Activities:
Common stock issued for services $ 300,000 $ - $ 300,000
Common stock issued for trading
securities $ - $ 939,764 $ 939,764
OXIR INVESTMENTS, INC. AND SUBSIDIARIES
(A Development Stage Company)
Notes to the Consolidated Financial Statements
September 30, 1999
NOTE 1 - CONDENSED FINANCIAL STATEMENTS
The accompanying consolidated financial statements have been
prepared by the Company without audit. In the opinion of
management, all adjustments (which include only normal
recurring adjustments) necessary to present fairly the
financial position, results of operations and cash flows at
September 30, 1999 and 1998 and for all periods presented
have been made.
Certain information and footnote disclosures normally
included in consolidated financial statements prepared in
accordance with generally accepted accounting principles
have been condensed or omitted. It is suggested that these
condensed consolidated financial statements be read in
conjunction with the consolidated financial statements and
notes thereto included in the Company's June 30, 1999
audited consolidated financial statements. The results of
operations for periods ended September 30, 1999 and 1998 are
not necessarily indicative of the operating results for the
full years.
Item 2. Management's Discussion and Analysis or Plan
of Operations
The Company continues to pursue strategic alternatives to
maximize the value of its portfolio of businesses. Some of these
alternatives have included, and will continue to include selective
acquisitions, establishing new projects and launching new
subsidiaries. The Company has provided, and may from time to time
in the future, provide information to interested parties regarding
portions of its businesses for such purposes.
Results of Operations
For the three months ended September 30, 1999 compared to the
three months ended September 30, 1998.
Net income for the three month period ended September 30, 1999
("first quarter of 1999") was $347,660, or $.02 per share, compared
to a $120,362 loss, or $.03 per share, for the three month period
ended September 30, 1998 ("first quarter of 1998"). This increase
in net income is due primarily to the substantial increase in the
Company funds invested in the stock market and general upward trend
in the market.
The Company did not recognize any sales during the first
quarter of 1999 or 1998, rather its revenues consist of realized and
unrealized gains on marketable securities. The Company realized a
gain on the sale of marketable securities of $918,814 and an
unrealized gain of $465,527 during the first quarter of 1999,
compared to no gains during the 1998 period.
During the first quarter of 1999, the Company had interest
expense of $55,261 compared to $0 for the 1998 period, which
reflects interest paid on the Company's margin accounts. General
and administrative expenses increased to $911,648 for the first
quarter of 1999 from $119,885 for the first quarter of 1998, and
rent expense increased to $19,813 from $0 for the same period.
These increases are due to increased operating activity and an
enlarged staff in the 1999 period and costs associated with opening
two offices. The Company also had depreciation expense of $37,353
for the first quarter of 1999 compared to $477 for the first quarter
of 1998.
A tax provision has been made for the first quarter of 1999 and
the fiscal year ended June 30, 1999 based on pre-tax capital gains.
The Company pays taxes under both the British Virgin Islands and
United States tax laws.
Liquidity and Capital Resources
Total cash and cash equivalents at September 30, 1999 was
$113,255 compared to $23,452 at June 30, 1999. Also at September
30, 1999, the Company had $3,025,403 in investments in trading
securities compared to $4,672,246 at June 30, 1999.
Net cash provided by operating activities for the first quarter
of 1999 was $943,566 compared to $223,885 used in the first quarter
of 1998. This was due primarily to the increase in the Company's
investment portfolio.
Net cash used by investing activities for the first quarter of
1999 was $882,623 compared to $102,663 for the comparable 1998
period. This is attributed primarily to the purchase of property
and equipment, and increase in margin account.
Net cash used by financing activities was $315 for the first
quarter of 1999 compared to $350,000 provided in the first quarter
of 1998. This reflects the issuance of the Company's stock for cash
and for costs during the 1998 period.
At September 30, 1999 the Company had total assets of
$9,239,989 and stockholders' equity of $4,983,408. In comparison,
at June 30, 1999, the Company had total assets of $8,765,153 and
total stockholders' equity of $4,335,748. Working capital was a
negative 907,800 at September 30, 1999, compared to a negative
$209,691 at June 30, 1999.
The Company anticipates meeting its working capital needs
during the next twelve months primarily with revenues from its
operating and investing activities or, if necessary from the sale
of securities. Management has not entered into any arrangements or
definitive agreements for additional sales of securities, either
through a private placement or a public offering. If the Company's
operations are not adequate to fund its operations and it is unable
to secure financing from the sale of its securities or from private
lenders, the Company could experience a cash flow shortage which
could curtail the Company's operations.
In the opinion of management, inflation has not had a material
effect on the operations of the Company.
Risk Factors and Cautionary Statements
This Report contains certain forward-looking statements. The
Company wishes to advise readers that actual results may differ
substantially from such forward-looking statements. Forward-looking
statements involve risks and uncertainties that could cause actual
results to differ materially from those expressed in or implied by
the statements, including, but not limited to, the following: the
possible success of the Company's varied projects, the volatility
of the financial markets in which the Company invests, the ability
of the Company to fund its current and future projects and its
ability to meet its cash and working capital needs, and other risks
detailed in the Company's periodic report filings with the
Securities and Exchange Commission.
PART II
Item 1. Legal Proceedings
There are presently no material pending legal proceedings to
which the Company or any of its subsidiaries is a party or to which
any of its property is subject and, to the best of its knowledge,
no such actions against the Company are contemplated or threatened.
Item 2. Changes In Securities
This Item is not applicable to the Company.
Item 3. Defaults Upon Senior Securities
This Item is not applicable to the Company.
Item 4. Submission of Matters to a Vote of Security Holders
This Item is not applicable to the Company.
Item 5. Other Information
This Item is not applicable to the Company.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 27 - Financial Data Schedules
(b) Reports on Form 8-K
No report on Form 8-K was filed by the Company during the
three month period ended September 30, 1999.
SIGNATURES
In accordance with the requirements of the Securities Exchange
Act of 1934, the Registrant caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
OXIR INVESTMENTS, INC.
Date: November 23, 1999 By /S/ Vassili I. Oxenuk
Vassili I. Oxenuk,
President and Director
Date: November 23, 1999 By /S/ Michael Smirnov
Michael Smirnov, Vice
President, Chief
Financial Officer and
Director
(Principal Accounting
Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE OXIR INVESTMENTS, INC. FINANCIAL
STATEMENTS FOR THE PERIOD ENDED SEPTEMBER 30, 1999
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-2000
<PERIOD-START> JUL-1-1999
<PERIOD-END> SEP-30-1999
<CASH> 113,255
<SECURITIES> 3,025,403
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,142,627
<PP&E> 5,774,282
<DEPRECIATION> 0
<TOTAL-ASSETS> 9,239,989
<CURRENT-LIABILITIES> 4,050,427
<BONDS> 206,154
0
0
<COMMON> 2,798,769
<OTHER-SE> 2,184,639
<TOTAL-LIABILITY-AND-EQUITY> 9,239,989
<SALES> 0
<TOTAL-REVENUES> 1,384,341
<CGS> 0
<TOTAL-COSTS> 968,814
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 55,261
<INCOME-PRETAX> 360,266
<INCOME-TAX> 12,606
<INCOME-CONTINUING> 347,660
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 347,660
<EPS-BASIC> .02
<EPS-DILUTED> .02
</TABLE>
