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SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
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FORM 10-Q
[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000.
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from: __________ to ___________.
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Commission file number 0-26909
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budgethotels.com, inc.
(Exact name of Registrant as specified in its charter.)
NEVADA 91-0179013
(State of other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1449 St. Paul Street
Suite 202
Kelowna, British Columbia V1Y 2E5
(Address of principal executive offices, including zip code.)
(205) 868-1171
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 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. Not subject
to filing until September 30, 1999.
YES [ x ] NO [ ]
The number of shares outstanding of the Registrant's Common Stock,
$0.01 par value per share, at March 31, 2000 was 13,214,000 shares.
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Consolidated Balance Sheets
ASSETS
February 29, November 30,
2000 1999
(Unaudited)
CURRENT ASSETS
Cash $ 27,061 $ 71,143
Accounts receivable, net 141,874 129,748
Accounts receivable - related party 8,217 8,217
--------- ---------
Total Current Assets 177,152 209,108
--------- ---------
PROPERTY AND EQUIPMENT (NET) 80,620 83,558
--------- ---------
OTHER ASSETS
Deferred offering costs 6,648 -
Prepaid commissions 55,059 39,612
--------- ---------
Total Other Assets 61,707 39,612
--------- ---------
TOTAL ASSETS $ 319,479 $ 332,278
========= =========
The accompanying notes are an integral part of these consolidated
financial statements.
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Consolidated Balance Sheets (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
February 29, November 30,
2000 1999
(Unaudited)
CURRENT LIABILITIES
Accounts payable $ 15,506 $ 26,844
Unearned revenue 190,733 226,601
---------- ----------
Total Current Liabilities 206,239 253,445
---------- ----------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock: 1,000,000 shares
authorized of $0.01 par value,
no shares issued and outstanding - -
Common stock: 50,000,000 shares
authorized of $0.001 par value,
13,214,000 shares issued
and outstanding 13,214 13,214
Additional paid-in capital 834,171 834,171
Accumulated deficit (734,145) (768,552)
---------- ----------
Total Stockholders' Equity 113,240 78,833
---------- ----------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 319,479 $ 332,278
========== ==========
The accompanying notes are an integral part of these consolidated
financial statements.
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<PAGE>
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Consolidated Statements of Operations
(Unaudited)
For the
Three Months Ended
February 29, February 28,
2000 1999
REVENUE
Net sales $ 206,589 $ 43,117
Cost of goods sold 40,905 19,589
--------- --------
Gross Profit 165,684 23,528
--------- --------
OPERATING EXPENSES
General and administrative 126,152 11,943
Depreciation 5,125 4,500
Total Operating Expenses 131,277 16,443
--------- --------
Income from Operations 34,407 7,085
OTHER INCOME (EXPENSE)
Loss on exchange rate - (1,710)
--------- --------
Total Other Income (Expense) - (1,710)
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NET INCOME $ 34,407 $ 5,375
========= ========
BASIC EARNINGS PER SHARE $ 0.00 $ 0.00
========= ========
The accompanying notes are an integral part of these consolidated
financial statements.
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<PAGE> 5
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Consolidated Statements of Stockholders' Equity
Additional
Common Stock Paid-in Accumulated
Shares Amount Capital Deficit
Balance,
November 30, 1999 11,487,000 $ 11,487 $ 61,894 $ (167,476)
Cancellation of common
stock previously issued
at $0.05 per share (600,000) (600) (27,480) -
Common stock issued for
cash at $0.25 per share 1,585,000 1,585 394,665 -
Common stock issued for
cash at $0.30 to $0.50
per share 42,000 42 16,958 -
Common stock issued for
services at $0.25
per share 400,000 400 99,600 -
Options on common stock
issued below market value
at $0.01 per share - - 240,000 -
Common stock issued for
services at $0.50
per share 300,000 300 149,700 -
Stock offering costs - - (101,166) -
Net loss for the year ended
November 30, 1999 - - - (601,076)
---------- -------- --------- ----------
Balance,
November 30, 1999 13,214,000 13,214 834,171 (768,552)
Net income for the three
months ended February 29,
2000 (unaudited) - - - 34,407
---------- -------- --------- ----------
Balance,
February 29, 2000
(unaudited) 13,214,000 $ 13,214 $ 834,171 $ (734,145)
========== ======== ========= ==========
The accompanying notes are an integral part of these consolidated
financial statements.
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<PAGE> 6
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Consolidated Statements of Cash Flows
(Unaudited)
For the
Three Months Ended
February 29, February 28,
2000 1999
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 34,407 $ 5,375
Adjustments to reconcile net income
to net cash used by operating
activities:
Depreciation 5,125 4,500
Cancellation of common stock issued
for services - (28,080)
Changes in assets and liabilities:
(Increase) decrease in accounts
receivable (12,126) 11,713
(Increase) decrease in deferred
offering costs (6,648) (9,905)
(Increase) decrease in deposits
and prepaids (15,447) (2,697)
Increase (decrease) in accounts
payable (11,338) (16,021)
Increase (decrease) in unearned
revenue (35,868) 7,643
Increase (decrease) in notes
payable - related parties - 172,885
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Net Cash Provided (Used) by
Operating Activities (41,895) 145,413
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CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets (2,187) (5,159)
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Net Cash Provided (Used) by
Investing Activities (2,187) (5,159)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES - -
--------- ---------
NET INCREASE (DECREASE) IN CASH (44,082) 140,254
CASH AT BEGINNING OF PERIOD 71,143 13,144
--------- ---------
CASH AT END OF PERIOD $ 27,061 $ 153,398
========= =========
SUPPLEMENTAL CASH FLOW INFORMATION
CASH PAID FOR:
Interest $ - $ -
Income taxes $ - $ -
NON-CASH FINANCING ACTIVITIES
Common stock issued for services
rendered $ - $ -
The accompanying notes are an integral part of these consolidated
financial statements.
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<PAGE> 7
BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Notes to the Consolidated Financial Statements
February 29, 2000 and November 30, 1999
NOTE 1 - CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The accompanying 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
February 29, 2000 and February 28, 1999 and for all periods presented
have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these condensed financial statements be read in conjunction with
the financial statements and notes thereto included in the Company's
November 30, 1999 audited financial statements. The result of
operations for the three months ended February 29, 2000 and February
28, 1999 are not necessarily indicative of the operating results for
the full years.
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.
The following discussion should be read in conjunction with the
consolidated statements and the notes thereto:
OPERATIONS DURING THE INTERIM PERIODS OF FEBRUARY 29, 2000 AND FEBRUARY
28, 1999.
Net sales for the three month period ended February 29, 2000 were
$206,589 compared to $43,117 for the three month period ended February
28, 1999.
The Company's working capital improved from a deficiency of
$44,337 as of November 30, 1999 to a deficiency of $29,087 as of
February 29, 2000. The improvement in the working capital was a result
of the Company's profitable operations for the three month period ended
February 29, 2000.
The Company had a net profit of $34,307 for the three month period
ending February 29, 2000 compared to a net profit of $5,375 for the
comparative period ending February 28, 1999. The increase in the
Company's net income is primarily a result of the Company's increased
sales.
LIQUIDITY AND CAPITAL RESOURCES
The Company's working capital improved by $15,250 for the three
month period ending February 28, 2000 and management expects to have
adequate cash to maintain operations for the balance of its fiscal year
and does not anticipate the need to raise additional cash through the
sale of shares or debt.
RESULTS OF OPERATIONS
The Company derives its revenue from two sources consisting of an
Internet web site and advertising boards.
Net sales for the three month period ending February 29, 2000 were
$206,589 compared to $43,117 for the comparative period ending February
28, 1999.
The increase in the net sales is a result of the Company owning
more advertising boards and earning revenue from the Company's web
site that was operational during the three month period ending February
29, 2000.
The Company's cost of sales (ie) commissions paid were $40,905 or
20% of net sales for the three month period ended February 29, 2000
compared to $19,589 or 46% of net sales for the three month period
ended February 28, 1999 and as a result the Company's gross margins
from operations were $165,684 (ie) 80% for the period ended February
29, 2000 versus $23,528 (ie) 54% for the three month period ended
February 28, 1999. The increased gross margins is a result of reduced
commissions paid on advertising renewals and no commissions paid on
Internet web site revenues.
The Company's general and administrative expenses were $126,152
for the three month period ended February 29, 2000 compared to $11,943
for the three month period ended February 28, 1999. The increase in
the general and administrative expenses is the result of additional
operating costs associated with the additions of more advertising
boards and the development of the Company's web site.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Registrant is not a party to any legal proceedings.
ITEM 2. RECENT SALES OF UNREGISTERED SECURITIES
The Registrant has not issued any unregistered securities.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
There have been no defaults upon securities.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
During the quarter ended March 31, 2000, no matters were submitted
to the Registrant's security holders.
ITEM 5. OTHER INFORMATION
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
Exhibits
Exhibit
No. Description
27 Financial Data Schedule
No reports on Form 8-K have been filed during the period ending March
31, 2000.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
Dated this 18th day of April, 2000.
budgethotels.com, inc.
(the "Registrant")
BY: /s/ William J. Marshall
William J. Marshall, President,
Chief Executive Officer, Treasurer,
Chief Financial Officer and a
member of the Board of Directors.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> NOV-30-2000
<PERIOD-END> FEB-29-2000
<CASH> 27,061
<SECURITIES> 0
<RECEIVABLES> 196,165
<ALLOWANCES> 46,074
<INVENTORY> 0
<CURRENT-ASSETS> 177,152
<PP&E> 166,741
<DEPRECIATION> 86,121
<TOTAL-ASSETS> 319,479
<CURRENT-LIABILITIES> 206,239
<BONDS> 0
0
0
<COMMON> 13,214
<OTHER-SE> 100,026
<TOTAL-LIABILITY-AND-EQUITY> 319,479
<SALES> 206,589
<TOTAL-REVENUES> 206,589
<CGS> 40,905
<TOTAL-COSTS> 131,277
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 34,407
<INCOME-TAX> 0
<INCOME-CONTINUING> 34,407
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 34,407
<EPS-BASIC> 0.00
<EPS-DILUTED> 0.00
</TABLE>
