Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB
|X| QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
|_| TRANSACTION REPORT UNDER SECTION 14 OR 15(D) OF THE
EXCHANGE ACT
For the transition period from ________ to _________
TRIMFAST GROUP, INC.
--------------------
(Name of Registrant as specified in its charter)
Nevada 0-26675 88-0367136
------ ------- ----------
(State or other jurisdiction of (Commission File (IRS Employer
incorporation or organization) No.) Identification No.)
777 S. Harbour Island Boulevard #780 Tampa, FL. 33602 (813) 275-0050
--------------------------------------------------------------------
(Address and Telephone number of principal executive offices)
Check whether the issuer has (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months, (or such
shorter period that the Registrant was required to file such report(s), 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: September 30, 1999
------------------
CLASS Outstanding at September 30, 1999
- ---------------------------- ---------------------------------
Common stock $.001 Par Value 4,540,978
<PAGE>
TRIMFAST GROUP, INC. AND SUBSIDIARIES
PART I: FINANCIAL INFORMATION PAGE
----
Consolidated Balance Sheet as of
September 30, 1999 (Unaudited) and
December 31, 1998 3
Consolidated Statements of Operations
for the Twelve Months Ended December 31, 1998
and for the Three and Nine Month Periods
Ended September 30, 1999 (Unaudited) 4
Consolidated Statement of Cash Flows
for the Year ended December 31, 1998
and for the Nine Months Ended
September 30, 1999 (Unaudited) 5
Consolidated Statement of Changes in Stockholders'
Equity for the one year ended December 31, 1998 and
for the Nine Months Ended September 30, 1999 (Unaudited) 6
Notes to Consolidated Financial Statements
(Unaudited) as of September 30, 1999 7-10
Management Discussion and Analysis of Financial
Condition and Results of Operations 11-12
PART II. OTHER INFORMATION AND SIGNATURES
Signatures 13
<PAGE>
TRIMFAST GROUP, INC.
INTERIM CONSOLIDATED BALANCE SHEET
AS OF DECEMBER 31, 1998 AND SEPTEMBER 30, 1999
ASSETS
<TABLE>
<CAPTION>
CURRENT ASSETS
September 30, 1999
December 31, 1998 (Unaudited)
----------------- ------------------
<S> <C> <C>
Cash 105,641 $ 59,092
Short-term investments 15,297 $ 41,220
Accounts Receivable- Trade 357,889 318,407
Accounts Receivable- Other 11,745 512,278
Inventory 188,737 377,270
----------- -----------
Total Current Assets 679,309 1,308,267
PROPERTY AND EQUIPMENT - NET 33,403 1,459,270
OTHER ASSETS
Prepaid expenses 0 50,000
Rent deposit 10,619 15,000
Cash surrender value of life insurance 8,107 12,646
Software development 0 228,705
Goodwill - Net 0 54,708
----------- -----------
Total Other Assets 18,726 361,060
----------- -----------
TOTAL ASSETS $ 731,438 $ 3,128,596
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 625,767 $ 926,612
Notes and loans payable 72,100 33,881
Convertible debentures 0 1,000,000
----------- -----------
Total Current Liabilities 697,867 1,960,493
----------- -----------
TOTAL LIABILITIES 697,867 1,960,493
----------- -----------
STOCKHOLDERS' EQUITY
Preferred Stock, Class A, $ 0.01 par value; 20,000,000 shares authorized; 0
and 15,000 shares issued and outstanding as of December 31, 1998
and September 30, 1999 respectively 0 150
Preferred Stock, Class B, $ 0.01 par value;
20,000,000 shares authorized; none issued and outstanding 0 0
Common Stock, $0.001 par value; 100,000,000 shares authorized, 2,193,059
and 4,540,978 shares issued and outstanding as of December 31, 1998 and
September 30, 1999 respectively 2,192 4,541
Common Stock to be issued (145,598 shares) as of December 31, 1998 146
Additional Paid-in capital 163,987 6,174,618
Accumulated deficit (109,220) (3,588,022)
Less cost of treasury stock (32,500 shares) (23,534) (139,547)
Less common stock shares advanced 0 (925,312)
Less common stock subscriptions receivable 0 (358,325)
----------- -----------
Total Stockholders' Equity 33,571 1,168,103
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 731,438 $ 3,128,596
=========== ===========
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
Page 3
<PAGE>
TRIMFAST GROUP, INC.
INTERIM CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE ONE YEAR ENDED DECEMBER 31, 1998 (Audited)
AND THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1999 (Unaudited)
<TABLE>
<CAPTION>
For the Three For the Nine
For the One Year Months Ended Months Ended
Ended September 30, 1999 September 30, 1999
December 31, 1998 (Unaudited) (Unaudited)
------------------ ------------------ ------------------
<S> <C> <C> <C>
NET SALES 1,925,332 207,201 581,337
COST OF SALES 567,472 89,925 408,495
---------- ---------- ----------
GROSS PROFIT 1,357,860 117,276 172,842
---------- ---------- ----------
OPERATING EXPENSES
Salaries and other compensation 221,773 208,215 505,372
Commissions 41,700 14,302 18,117
Depreciation and amortization 10,498 54,202 54,202
Professional fees 49,511 505,576 1,467,900
Bad debt expense 503,839 102,723 102,723
Selling, general and administrative expenses 423,289 249,593 623,451
Travel and entertainment 64,187 54,240 132,249
---------- ---------- ----------
Total Operating Expenses 1,314,797 1,188,851 2,904,014
---------- ---------- ----------
INCOME FROM OPERATIONS 43,063 (1,071,575) (2,731,172)
---------- ---------- ----------
OTHER INCOME (EXPENSE)
Realized gain on sale of trading securities - net 1,905 499 499
Unrealized gain on sale of trading securities - net 922 0 (18,549)
Interest expense (3,264) (354,569) (354,569)
---------- ---------- ----------
Total Other Income (Expense) (437) (354,070) (372,619)
---------- ---------- ----------
---------- ---------- ----------
NET INCOME/ (LOSS) 42,626 (1,425,645) (3,103,791)
========== ========== ==========
NET INCOME/ (LOSS) PER COMMON SHARE - BASIC 0.02 (0.31) (0.77)
WEIGHTED AVERAGE COMMON 1,723,134 4,574,887 4,029,906
SHARES OUTSTANDING - BASIC
NET INCOME/ (LOSS) PER COMMON SHARE - DILUTED N/A (0.29) (0.75)
FULLY DILUTED WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING -DILUTED N/A 4,835,900 4,113,569
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
Page 4
<PAGE>
TRIMFAST GROUP, INC.
INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE ONE YEAR ENDED DECEMBER 31, 1999 (Audited)
AND THE NINE MONTHS ENDED SEPTEMBER 30, 1999 (Unaudited)
<TABLE>
<CAPTION>
For the Nine Months
For the One Year Ended
Ended September 30, 1999
December 31, 1998 (Unaudited)
----------------- -------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) 42,626 (3,103,791)
Adjustments to reconcile net income (loss)
to net cash flows from operating activities:
Depreciation and amortization 10,498 54,202
Bad debt expense 503,839 6,498
Unrealized gain on short term investments (922) (18,459)
Issuance of warrants for professional services 0 461,640
Issuance of common stock for professional services 0 760,207
Changes in operating assets and liabilities
(Increase) decrease in:
Accounts receivable (856,839) (472,796)
Prepaid expenses 0 (50,000)
Inventory (165,038) (188,533)
Increase (decrease) in:
Accounts payable and other liabilities 496,181 300,845
---------- ----------
Total adjustments (12,281) 853,604
---------- ----------
Net cash (used in) provided by operating activities 30,345 (2,250,187)
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
(Increase) decrease in:
Short term investments (14,375) (25,923)
Due from employees (5,800) 5,800
Property and equipment (37,821) (1,748,024)
Due from affiliate (5,945) 5,945
Rent deposit (8,119) (4,381)
Cash surrender value of life insurance (8,107) (4,529)
Purchase of treasury stock (23,534) (116,013)
---------- ----------
Net cash (used in) provided by investing activities (103,701) (1,887,125)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings 1,975 961,781
Proceeds from issuance of common stock 177,800 1,628,942
Proceeds from issuance of preferred stock 0 1,500,040
Due to stockholder/ officer (18,436) 0
---------- ----------
Net cash provided by (used in) financing activities 161,339 4,090,763
---------- ----------
CHANGE IN CASH AND CASH EQUIVALENTS 87,983 (46,549)
CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR 17,658 105,641
----------
========== ==========
CASH AND CASH EQUIVALENTS - END OF YEAR 105,641 59,092
========== ==========
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
Page 5
<PAGE>
TRIMFAST GROUP, INC.
INTERIM CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE ONE YEAR ENDED DECEMBER 31, 1999 (Audited)
AND THE NINE MONTHS ENDED SEPTEMBER 30, 1999 (Unaudited)
<TABLE>
<CAPTION>
Common Stock and Common Additional
Stock to be Issued Paid-In Preferred Stock Issued
Shares Amount Capital Shares Amount
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
BALANCE JANUARY 1, 1998 3,000,000 $ 1,000 -- -- --
Issuance of common stock in exchange for shares
of TrimFast Holdings, Inc. 278,080 227,800 -- -- --
Effect of recapitalization 19,404,907 (206,117) 37,413 -- --
Issuance of common stock in exchange for
stockholder loans 703,577 70 126,574 -- --
Reverse one-for-ten split (21,047,908) (20,415) -- -- --
Repurchase of treasury stock at cost -- -- -- -- --
Net income 1998 -- -- -- -- --
----------- ----------- ----------- ----------- -----------
Balance, December 31, 1998 2,338,656 $ 2,338 $ 163,987 -- --
----------- ----------- ----------- ----------- -----------
Equity financing - issuance of common stock for cash 558,000 558 1,628,942 -- --
Issuance of common stock in exchange for
consulting and other professional services 1,219,464 1,220 447,395 -- --
Issuance of common stock acquisition of Immmu and
Imcel. To be returned per recission agreement. 235,000 235 925,077 -- --
Issuance of common stock to employees 150,358 150 95,247 -- --
Issuance of convertible debentures -- -- 250,000 -- --
Return of common stock in repayment of debt (50,000) (50) (399,950) -- --
Issuance of common stock held in escrow to
secure loan 23,000 23 199,790 -- --
Issuance of common stock for debt repayment 24,500 25 168,006 -- --
Repurchase of treasury stock at cost -- -- -- -- --
Settlement of outstanding liabilities 42,000 42 359,583 -- --
Issuance of Preferred Stock -- -- 1,874,901 15,000 150
Valuation of warrants issued for services -- -- 461,640 -- --
Net Loss, year to date as of September 30, 1999 -- -- -- -- --
----------- ----------- ----------- ----------- -----------
Balance, September 30, 1999 4,540,978 $ 4,541 $ 6,174,618 15,000 $ 150
=========== =========== =========== =========== ===========
<CAPTION>
Accumulated Subscriptions Shares Treasury
Deficit Receivable Advanced Stock Total
----------- ------------ ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
BALANCE JANUARY 1, 1998 ($151,846) -- -- -- ($150,846)
Issuance of common stock in exchange for shares
of TrimFast Holdings, Inc. -- -- -- -- $ 227,800
Effect of recapitalization -- -- -- -- ($168,704)
Issuance of common stock in exchange for
stockholder loans -- -- -- -- $ 126,644
Reverse one-for-ten split -- -- -- -- ($20,415)
Repurchase of treasury stock at cost -- -- -- (23,534) ($23,534)
Net income 1998 42,626 -- -- -- $ 42,626
----------- ----------- ----------- ----------- -----------
Balance, December 31, 1998 ($109,220) -- -- ($23,534) $ 33,571
----------- ----------- ----------- ----------- -----------
Equity financing - issuance of common stock for cash -- -- -- -- $ 1,629,500
Issuance of common stock in exchange for
consulting and other professional services -- (358,325) -- -- $ 90,290
Issuance of common stock acquisition of Immmu and
Imcel. To be returned per recission agreement. -- -- (925,312) -- $ 0
Issuance of common stock to employees -- -- -- -- $ 95,397
Issuance of convertible debentures -- -- -- -- $ 250,000
Return of common stock in repayment of debt -- -- -- -- ($400,000)
Issuance of common stock held in escrow to
secure loan -- -- -- -- $ 199,813
Issuance of common stock for debt repayment -- -- -- -- $ 168,031
Repurchase of treasury stock at cost -- -- -- (116,013) ($116,013)
Settlement of outstanding liabilities -- -- -- -- $ 359,625
Issuance of Preferred Stock (375,011) -- -- -- $ 1,500,040
Valuation of warrants issued for services -- -- -- -- $ 461,640
Net Loss, year to date as of September 30, 1999 (3,103,791) -- -- -- ($3,103,791)
=========== =========== =========== =========== ===========
Balance, September 30, 1999 ($3,588,022) ($358,325) ($925,312) ($139,547) $ 1,168,103
=========== =========== =========== =========== ===========
</TABLE>
See Accompanying Notes to Consolidated Financial Statements
Page 6
<PAGE>
TrimFast Group, Inc.
Notes to Interim Consolidated Financial Statements
As of September 30, 1999
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles and
the rules and regulations of the Securities and Exchange Commission for
interim financial information. Accordingly, they do not include all the
information and footnotes necessary for a comprehensive presentation of
financial position and results of operation.
It is management's opinion, however that all material adjustments
(consisting of normal recurring adjustments) have been made which are
necessary for a fair financial statements presentation. The results for
the interim period are not necessarily indicative of the results to be
expected for the year.
For further information, refer to the consolidated financial statements
and footnotes included in the company's Form 10-SB, as amended for the
year ended December 31, 1998.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION
(A) Revenue Recognition
Nutrition Cafe charges a monthly membership fee for access to order
products at discounted prices. Memberships are sold on a pay-as-you-go
basis in one month increments. Members choose whether or not to continue
their membership each month; no long term agreements are required. The
membership fees are recognized as revenue in the month they are paid.
Revenue for products ordered is recognized when the product is shipped.
Revenue for the Cooler Group is earned through rental of water coolers and
delivery of water. A contract is signed for cooler rental and/or water
delivery service, and is invoiced monthly. Revenue is recognized for
cooler rental each month when invoiced and for water service based on
usage when delivered.
(B) Accounts Receivable - Other
Components of A/R - Other is as follows:
Millennium - related party $259,558
Cash from recission of IMMMU purchase 50,000
Stock held in escrow securing loan 199,790
Other 2,930
--------
$512,278
========
Page 7
<PAGE>
TrimFast Group, Inc.
Notes to Interim Consolidated Financial Statements
As of September 30, 1999
(Unaudited)
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION - (Cont'd)
(B) Accounts Receivable - Other (Cont'd)
On May 26, 1999 the company placed in an escrow account 23,000 shares of its'
common stock valued at $199,790 to secure the loan to acquire Ice Cold Water,
Inc. (See note 7B) The shares will be returned to authorized when the loan is
satisfied.
(C) Inventory
Components of inventory are as follows:
Finished Goods $320,296
Product Components 56,974
--------
Total $377,270
========
The Company performs periodic inspections of inventory to identify expired
or obsolete items. Any merchandise, which has past its expiration date, or
has been deemed obsolete by management, is removed from inventory and
written off.
(D) Advertising Costs
Advertising costs are expensed as incurred unless a direct measurable
response exists. All advertising related costs have been recognized as
expense in these Interim Financial Statements.
(E) Software Development
The Company has contracted with an outside software development firm to
develop software that runs the website for Nutrition Cafe. All costs
associated with the development of the software have been capitalized
while any costs associated with content have been expensed.
NOTE 3 - ACQUISITION OF BUILDING
On July 30, 1999 the Company exercised its option to purchase the facility
located at 2555 Blackburn Street, Clearwater, FL for $1,200,000. The
property is used as the sales, storage and distribution facility for
Nutrition Cafe, Inc. The funds were raised through the sale of 15,000
shares of Class A Preferred Stock and 223,681 warrants to purchase common
stock. (See Note 6)
Page 8
<PAGE>
TrimFast Group, Inc.
Notes to Interim Consolidated Financial Statements
As of September 30, 1999
(Unaudited)
NOTE 4 - WCW LICENSE AGREEMENT
On June 2, 1999 the Company signed a license agreement with World
Championship Wrestling, Inc (WCW) to utilize certain names, likeness,
characters, trademarks and/or copyrights in connection with the
manufacture, distribution, advertising, promotion and sale of certain
articles of merchandise.
The license extends through December 2002. The agreement includes a
non-refundable advance of $50,000 which, has been capitalized as prepaid
expense and will be amortized over the life of the agreement. Terms of the
agreement include a royalty payment of 6% of net sales with the following
guarantees:
$100,000 Due No Later Than 12-31-99
$100,000 Due No Later Than 6-30-00
$100,000 Due No Later Than 9-30-00
$100,000 Due No Later Than 12-31-00
$100,000 Due No Later Than 6-30-01
NOTE 5 - CONVERTIBLE DEBENTURE
On June 14, 1999 the Company issued $1,000,000 in Convertible Debentures
in exchange for $1,000,000 in cash. The agreement, which contains a
beneficial conversion feature, stipulates that the debentures may be
converted as of the closing date at the lower of $8.50 or 80% of the fair
market value of the common stock on the conversion date resulting in the
recognition of $250,000 interest expense at closing.
NOTE 6 - EQUITY TRANSACTIONS
Sale of Preferred Stock and Warrants
On July 16, 1999 (the "issuance date") the Company issued 15,000 shares of
convertible preferred stock and 223,881 warrants to purchase common stock
in exchange for $1,500,040 cash. The preferred stock contains a beneficial
conversion feature whereby it is convertible immediately at the lesser of
$8.59 or 80% of the fair market value of the common stock on the
conversion date. The warrants vest immediately, expire on July, 2000 and
are exercisable at $10.31 per share. As a result of accounting for the
beneficial conversion feature, the Company charged a $375,011 dividend to
retained earnings on the issuance date. (See Note 3)
Page 9
<PAGE>
TrimFast Group, Inc.
Notes to Interim Consolidated Financial Statements
As of September 30, 1999
(Unaudited)
NOTE 7 - ACQUISITIONS
(A) Acquisitions of Subsidiaries and Subsequent Recission
On March 18, 1999 the Company acquired IMMMU, Inc. ("IMMMU") and IMMCEL
Pharmaceuticals, Inc. ("IMMCEL"), two companies related through common
stockholders, in a transaction accounted for as a purchase. Under terms of
the agreement, 235,000 shares of the Company's common stock, $50,000 in
cash and an option agreement for shares of the Company's common stock
exercisable based on stipulated Company performance criteria were
exchanged for all of the issued and outstanding capital stock of IMMMU and
IMMCEL. Subsequently, the Company entered into a recission agreement of
the purchase. Activity from IMMMU and IMMCEL are not part of these
consolidated statements. The common stock shares are recorded as "Common
Shares Advanced" and deducted from stockholder equity and the $50,000 is
recorded in Accounts Receivable - Other. The Company incurred a loss of
$94,225 from operating the companies during 1999 which is recorded in
Accounts Receivable - Other with a reserve for 100% recorded as bad debt.
(B) Asset Accumulation
On May 24, 1999 the Company acquired certain assets of Ice Cold Water Co.,
Inc. ("ICW") including certain receivables, inventory, property and
equipment, a customer list and the name "Ice Cold Water" and all other
intellectual property rights associated with the name. Under terms of the
agreement, the Company acquired the assets for $20,000 in cash and a
$100,000 promissory note at 8.5% per annum which is due in four monthly
installments of $25,000 plus accrued interest, commencing June 10, 1999. A
balance of $30,406 remains outstanding at August 31, 1999.
Page 10
<PAGE>
TRIMFAST GROUP, INC.
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
FINANCIAL STATEMENT PRESENTATION
The financial statements are presented without comparable 1998 quarterly
information. The Company was not publicly traded in 1998 and systems, though
adequate to address annual audit needs, were not in place to allow for
extracting reliable quarterly information.
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999 AND FOR THE THREE MONTHS ENDED
SEPTEMBER 30, 1999.
RESULTS OF OPERATIONS
Sales for the nine months ended September 30, 1999 were $581,337 as
compared to $1,925,332 for the year ended December 31, 1998 ($1,443,999 adjusted
proportionately for the nine months ended September 30, 1998.). The significant
decline in sales is primarily attributable to the Company's decision to
discontinue the sale of Revivarant, a muscle replenishment supplement. This
decision was initiated by an industry wide investigation by the Food and Drug
administration into the active ingredient in Revivarant. Management had expected
that the introduction of the Immcel and Immmu product lines would add to
revenues. However, customer acceptance proved disappointing and the prior owner,
and key employee refused to honor his contractual commitments to manage the
Company. As a result, the Company has rescinded its agreement with the prior
owners of Immmu and Immcel and will focus on the expansion of its own line of
nutritional supplements. All rights title and interest to the Immmu/Immcel
product lines will revert back to their prior owners, all consideration paid or
received will be returned and any profits or losses generated from the operation
on Immmu/Immcel will be allocated to its prior owners.
Management believes that a significant boost to its revenues will be
generated from its licensing agreement with World Championship Wrestling
("WCW"). The Company intends to sell high nutrition, energy bars with the WCW
logo and images of the various wrestling personalities. Both food brokers and
retail stores have shown tremendous interest in the product. The Company
anticipates shipping the bars in December and January with a national
advertising campaign tentatively scheduled to begin in February. While there can
be no assurance that the product will meet anticipated demand, management
believes that the sale of the WCW energy bars will be a significant source of
revenues for the Company.
With the acquisition, formation and expansion of business activities
during 1999, operating expenses increased significantly. Salaries for the year
ended December 31, 1998 total $221,773 as compared to $505,372 for the nine
months ended September 30,
Page 11
<PAGE>
1999. New employees had to be hired to handle the increased business activities
of the Company.
For the nine months ended September 30, 1999 the Company recorded
$1,467,900 in professional fees. Management anticipates that professional fees
will decline significantly in the future.
Selling general and administrative expenses were $423,289 for the year
ended December 31, 1998 as compared to $623,451 for the nine months ended
September 30, 1999. Approximately $175,000 of this increase was attributable to
advertising for NutritionCafe.
Approximately $250,000 of the interest expense of $354,569 is attributable
to the intrinsic value of the convertible debenture executed by the Company.
Net income for the year ended December, 31 1998 was $43,063. The Company
has generated a net loss of $2,731,172 for the nine months ended September 30,
1999 and a net loss of $0.77 per share.
LIQUIDITY AND CAPITAL RESOURCES
December 31, 1998 as compared to September 30, 1999
Total cash and cash equivalents as of September 30, 1999 were $100,312 as
compared to $120,938 as of December 31, 1998, a decline of approximately 17%.
Trade receivables declined from $357,889 to $318,407 and inventory increased
from $188,737 to $377,270. This increase in inventory is attributable to the
launch of Nutrition Cafe and the required inventory the Company is required to
carry to meet customer orders.
Total current assets increased approximately 40%, increasing from $679,309
to $1,308,267.
Property and equipment increased from $33,403 to $1,459,270. This increase
is due primarily to the purchase by the Company of the facility which houses its
warehouse operations for Nutrition Cafe and the equipment purchased to operate
this facility. The $228,705 attributable to software development represents the
Company's investment in the Nutrition Cafe website software.
The Company also experienced a significant increase in liabilities.
Accounts payable increased from $625,757 to $926,612 and the Company issued
convertible debt instrument in the amount of $1,000,000. The proceeds raised
from this debt offering were used to purchase the warehouse facility.
Management believes that the Company has sufficient revenue and reserves
to finance ongoing business activities.
Page 12
<PAGE>
Part II. Other Information
Item 6 Exhibits
Exhibit 27
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
TrimFast Group, Inc.
/s/ Michael Muzio
- ----------------------------
BY: Michael Muzio, President
Dated: This 22nd day of November 1999
Page 13
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 59,092
<SECURITIES> 41,220
<RECEIVABLES> 1,011,054
<ALLOWANCES> (102,723)
<INVENTORY> 377,270
<CURRENT-ASSETS> 1,385,913
<PP&E> 1,802,572
<DEPRECIATION> (59,889)
<TOTAL-ASSETS> 3,128,596
<CURRENT-LIABILITIES> 1,960,493
<BONDS> 0
0
150
<COMMON> 4,541
<OTHER-SE> 1,163,412
<TOTAL-LIABILITY-AND-EQUITY> 3,128,596
<SALES> 581,337
<TOTAL-REVENUES> 581,836
<CGS> 408,495
<TOTAL-COSTS> 2,801,291
<OTHER-EXPENSES> 18,549
<LOSS-PROVISION> 102,723
<INTEREST-EXPENSE> 354,569
<INCOME-PRETAX> (3,103,791)
<INCOME-TAX> 0
<INCOME-CONTINUING> (3,103,791)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,103,791)
<EPS-BASIC> (0.77)
<EPS-DILUTED> (0.75)
</TABLE>
