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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
FOR THE QUARTERLY PERIOD ENDED MAY 31, 2000
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 0-26909
budgethotels.com Inc.
(Exact name of registrant as specified in its charter)
Nevada 91-0179013
(State of other jurisdiction (IRS Employer Identification
of incorporation or organization) Number)
1449 St. Paul Street
Suite 202
Kelowna, British Columbia V1Y 2ES
(Address of principal executive offices)
(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 Exchange 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.
Yes [x] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of May 31, 2000: 13,214,000
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BUDGETHOTELS.COM, INC.
AND SUBSIDIARY
CONSOLIDATED FINANCIAL STATEMENTS
MAY 31, 2000 AND NOVEMBER 30, 1999
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Consolidated Balance Sheets
ASSETS
<TABLE>
<CAPTION>
May 31, November 30,
2000 1999
----------- -------------
(Unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash $ 1,520 $ 71,143
Accounts receivable, net 153,384 129,748
Accounts receivable - related party 8,217 8,217
Prepaid commissions 63,299 --
-------- --------
Total Current Assets 226,420 209,108
-------- ---------
PROPERTY AND EQUIPMENT (NET) 84,467 83,558
-------- ---------
OTHER ASSETS
Deferred offering costs 28,308 --
Prepaid commissions -- 39,612
------- ---------
Total Other Assets 28,308 39,612
------- ---------
TOTAL ASSETS $ 339,195 $ 332,278
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</TABLE>
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Consolidated Balance Sheets (Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
May 31, November 30,
2000 1999
---------- ---------
(Unaudited)
<S> <C> <C>
CURRENT LIABILITIES
Accounts payable $ 21,956 $ 26,844
Unearned revenue 201,863 226,601
---------- --------
Total Current Liabilities 223,819 253,445
---------- --------
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 (732,009) (768,552)
--------- ---------
Total Stockholders' Equity 115,376 78,833
--------- ---------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 339,195 $ 332,278
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</TABLE>
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Consolidated Statements of Operations
(Unaudited)
<TABLE>
<CAPTION>
For the For the
Three Months Ended Six Months Ended
May 31, May 31,
------------------------ -------------------------
2000 1999 2000 1999
---------- ---------- --------- ----------
<S> <C> <C> <C> <C>
REVENUE
Net sales $ 394,321 $ 159,824 $ 600,910 $ 305,644
Cost of goods sold 100,632 145,472 141,537 198,237
--------- --------- --------- ---------
Gross Profit 293,689 14,352 459,373 107,407
--------- --------- --------- ---------
EXPENSES
General and administrative 282,575 324,950 408,727 430,053
Depreciation 8,978 2,524 14,103 5,048
--------- --------- --------- ---------
Total Expenses 291,553 327,474 422,830 435,101
--------- --------- --------- ---------
Income (Loss) from Operations 2,136 (313,122) 36,543 (327,694)
--------- --------- --------- ---------
OTHER INCOME (EXPENSE)
Gain (loss) on exchange rate -- 3,091 -- 6,277
Interest income -- -- -- --
--------- --------- --------- ---------
Total Other Income (Expense) -- 3,091 -- 6,277
--------- --------- --------- ---------
NET INCOME (LOSS) $ 2,136 $(310,031) $ 36,543 $(321,417)
========= ========== ========= ==========
BASIC EARNINGS (LOSS)
PER SHARE $ 0.00 $(0.03) $ 0.00 $ (0.04)
========= ========== ========= ==========
</TABLE>
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
(Formerly Info Center International, Inc.)
Consolidated Statements of Stockholders' Equity
<TABLE>
<CAPTION>
Common Stock Paid-in
----------------------------- Additional Accumulated
Shares Amount Capital Deficit
----------- ------------ ----------- -------------
<S> <C> <C> <C> <C>
Balance, November 30, 1998 11,487,000 $ 11,487 $ 61,894 $ (167,476)
Cancellation of common stock (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 --
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 six months
ended May 31, 2000 (unaudited) -- -- -- 36,543
----------- ----------- ----------- -----------
Balance, May 31, 2000
(Unaudited) 13,214,000 $ 13,214 $ 834,171 $ (732,009)
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</TABLE>
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Consolidated Statements of Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
For the For the
Three Months Ended Six Months Ended
May 31, May 31,
-------------------------- --------------------------
2000 1999 2000 1999
---------- ---------- --------- -----------
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ 2,136 $(310,031) $ 36,543 $(321,417)
Adjustments to reconcile net income (loss) to
net cash used by operating activities:
Depreciation 8,978 2,524 14,103 5,048
Common stock and options issued for services -- 311,920 -- 311,920
Changes in assets and liabilities:
(Increase) decrease in accounts receivable (11,510) (55,980) (23,636) (44,038)
(Increase) decrease in deferred offering costs (21,660) -- (28,308) --
(Increase) decrease in deposits and prepaids (8,240) (1,860) (23,687) (2,523)
Increase (decrease) in accounts payable 6,451 (9,450) (4,887) (16,534)
Increase (decrease) in unearned revenue 11,130 34,980 (24,738) 5,339
--------- --------- --------- ---------
Net Cash Provided (Used) by
Operating Activities (12,715) (27,897) (54,610) (62,205)
--------- --------- --------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets (12,826) (16,826) (15,013) (26,156)
--------- --------- --------- ---------
Net Cash Provided (Used) by
Investing Activities (12,826) (16,826) (15,013) (26,156)
--------- --------- --------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments on note payable
- related party -- (44,407) -- (44,407)
Proceeds from sales of common stock -- 213,250 -- 413,250
Stock offering costs -- (85,079) -- (101,166)
-------- --------- --------- ---------
Net Cash Provided (Used) by
Financing Activities $ -- $ 83,764 $ -- $ 267,677
--------- --------- --------- ---------
</TABLE>
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Consolidated Statements of Cash Flows (Continued)
(Unaudited)
<TABLE>
<CAPTION>
For the For the
Three Months Ended Six Months Ended
May 31, May 31,
------------------------ -------------------------
2000 1999 2000 1999
---------- ---------- --------- ----------
<S> <C> <C> <C> <C>
NET INCREASE (DECREASE) IN CASH $ (25,541) $ 39,041 $ (69,623) $ 179,316
CASH AT BEGINNING OF PERIOD 27,061 153,419 71,143 13,144
---------- --------- -------- ---------
CASH AT END OF PERIOD $ 1,520 $ 192,460 $ 1,520 $ 192,460
========= ========== ========= ==========
SUPPLEMENTAL CASH FLOW INFORMATION
CASH PAID FOR:
Interest $ -- $ -- $ -- $ --
Income taxes $ -- $ -- $ -- $ --
NON-CASH FINANCING ACTIVITIES
Common stock and options issued for
services rendered $ -- $ 311,920 $ -- $ 311,920
</TABLE>
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BUDGETHOTELS.COM, INC. AND SUBSIDIARY
Notes to the Consolidated Financial Statements
May 31, 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
May 31, 2000 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 six months ended May 30, 2000 are not necessarily
indicative of the operating results for the full years.
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ITEM 6. MANAGEMENT'S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
The following discussion should be read in conjunction with the
consolidated statements and the notes thereto:
OPERATIONS DURING THE INTERIM PERIOD OF MAY 31, 2000.
(i) For the three month period ended May 31, 2000.
Net sales for the three month period ended May 31, 2000 were $394,321,
an increase of 147% compared to sales of $159,824 for the comparative
three month period ended May 31, 1999.
The Company had a net profit of $2,136 for the three month period
ending May 31, 2000 compared to a loss of ($313,122) for the
comparative period ended May 31, 1999.
(ii) For the six month period ended May 31, 2000.
Net sales for the six month period ended May 31, 2000 were $600,910,
an increase of 97% compared to sales of $305,644 for the comparative
six month period ended May 31, 1999.
The Company had a net profit of $36,543 for the six month period
ending May 31, 2000 compared to a loss of ($321,417) for the
comparative period ended May 31, 1999.
The Company's working capital improved from a deficiency of ($44,337) as of
November 30, 1999 to a surplus of $2,601 as of May 31, 2000. The improvement in
the working capital was a result of the Company's profitable operations for the
period ended May 31, 2000 and the reclassification of prepaid commissions from
other assets to a current asset.
LIQUIDITY AND CAPITAL RESOURCES
The Company's working capital improved by $46,938 for the six month period
ending May 31, 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 to finance the
Company's ongoing business.
RESULTS OF OPERATIONS
The Company derives its revenue from two sources consisting of an
Internet web site and advertising boards.
i) For the three month period ended May 31, 2000.
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Net sales for the three month period ending May 31, 2000 were $394,321
compared to $159,824 for the comparative period ending May 31, 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 period ending May 31, 2000.
The Company's cost of sales for the three month period ended May 31,
2000 were $100,632 or 25.5% of net sales compared to $145,472 or 90.3%
of net sales for the three month period ended May 31, 1999 and as a
result the Company's gross margins from operations increased to
$293,689 or 74.5% of sales compared to a gross margin of 9.7% for the
comparative period. The increased gross margins is a result of reduced
commissions paid on advertising board renewals and no commissions paid
on Internet web site revenues.
The Company's general and administrative expenses decreased from
$324,950 for the three month period ending May 31, 1999 to $282,575
for the three month period ended May 31, 2000. The decrease in the
general and administrative expenses was a result of reduced
professional services and web site development costs.
Net income for the three month period ended May 31, 2000 was $2,136
compared to a loss of ($310,031) for the three month period ended May
31, 1999.
ii) For the six month period ended May 31, 2000.
Net sales for the six month period ending May 31, 2000 were $600,910
compared to $305,644 for the comparative period ending May 31, 1999.
Cost of sales for the six month period ending May 31, 2000 were
$141,537 or 23.6% of net sales compared to $198,237 or 64.9% of net
sales for the six month period ending May 31, 2000.
The Company's gross margins from operations for the six month period
ending May 31, 2000 increased to $459,373 or 76.4% of net sales
compared to $107,407 or 35.1% net sales for the six month period ended
May 31, 1999.
The Company's general and administrative expenses decreased from
$430,053 for the six month period ended May 31, 1999 to $408,727 for
the six month period ended May 31, 2000.
Net income for the six month period ended May 31, 2000 was $36,543
compared to a loss of $(321,417) for the six month period ended May
31, 2000.
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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.
BUDGETHOTELS.COM INC.
- (registrant)
Date: July 13, 2000 By: /s/ William J. Marshall
-------------------------------------
William J. Marshall, President, Chief
Executive Officer, Treasurer, Chief
Financial Officer and a member of the
Board of Directors.
