<PAGE>
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 September 30, 1997
[ ] Transition Report Pursuant to Section 13 of 15(d) of the
Securities Exchange Act of 1934
Commission file number 0-5667
Seal Holdings Corporation
(Exact name of registrant as specified in its charter)
Delaware 64-0769296
(State of Incorporation) (IRS Employer ID No.)
125 Worth Avenue, Suite 314, Palm Beach, Florida 33480
(Address of principal executive offices) (Zip Code)
(561) 833-5111
(issuer's telephone number)
Check whether the issuer (1) filed all reports required to be
filed by Section 13 or 15(d) of the Exchange Act 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 ( )
Class A common stock, par value $.20 per share, 1,219,756 shares
outstanding as of November 5, 1997
Class B common stock, par value $.20 per share, 25,000 shares
outstanding as of November 5, 1997
Transitional Small Business Disclosure Format (Check one):
Yes ( ) No (X)
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INDEX
Page
PART I. FINANCIAL INFORMATION
Condensed Consolidated Balance Sheets 3
Condensed Consolidated Statements of
Operations 5
Condensed Consolidated Statements of Cash
Flows 6
Notes to Condensed Consolidated Financial Statements 7
Management's Discussion and Analysis of Financial
Condition and Results of Operations 8
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 9
Item 6. Exhibits and reports on Form 8-K 9
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
SEAL HOLDINGS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands of dollars)
<TABLE>
<CAPTION>
Sept. 30 December 31
1997 1996
(UNAUDITED) (AUDITED)
<S> <C> <C>
ASSETS
Current Assets:
Cash and Cash Equivalents (Note B) $ 1,689 $ 2,437
Other receivables 84 14
Prepaid Expenses 18 8
Net assets of discontinued operations
(Note C) 132 64
-------- --------
Total current assets 1,923 2,523
PROPERTY AND EQUIPMENT
Furniture and equipment 110 58
Less accumulated depreciation (58) (53)
-------- --------
Property and equipment, net 52 5
OTHER ASSETS
Assets held for resale (Note D) 154
Other assets (Note E) 182 4
-------- --------
TOTAL ASSETS $ 2,157 $ 2,686
======== ========
</TABLE>
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<PAGE>
SEAL HOLDINGS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands of dollars)
<TABLE>
<CAPTION>
September 30 December 31
1997 1996
(Unaudited) (Audited)
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Trade accts. payable & accrued exp $ 78 $ 54
-------- --------
Total current liabilities 78 54
-------- --------
Total liabilities 78 54
SHAREHOLDERS' EQUITY
Class A common stock, $.20 par
value; 14,975,000 shares author-
ized and 1,336,124 shares
issued in 1997. $.10 par value;
3,700,000 shares authorized and
2,432,248 shares issued in 1996 243 243
Class B common stock, $.20 par
value; 25,000 shares author-
ized, issued and outstanding in
1997. $.10 par value; 50,000
shares authorized, issued and
outstanding in 1996 5 5
Additional paid-in capital 4,475 4,475
Accumulated deficit (2,551) (2,042)
Class A common stock held in
treasury at cost; 116,369 and
169,843 shares in 1997 and 1996,
respectively ( 93) (49)
-------- --------
Shareholders' equity 2,079 2,632
-------- --------
LIABILITIES AND SHAREHOLDERS' EQUITY $ 2,157 $ 2,686
======== ========
</TABLE>
See notes to condensed consolidated financial statements.
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SEAL HOLDINGS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands of dollars except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three months ended Nine Months ended
September 30 September 30
1997 1996 1997 1996
-------- -------- ------- -------
<S> <C> <C> <C> <C>
Income from continuing
operations $ ( 61) $ $ (509) $
Income (loss) from
discontinued operations
(less applicable income
tax) (1,399) (1,033)
Gain on sale of discon-
tinued operations (less
applicable income tax of
$250,000) 7,422 7,422
------- ------- ------- -------
Net income (loss) $ ( 61) $ 6,023 $ (509) $ 6,389
NET INCOME (LOSS) PER SHARE
From continuing operations $ (.05) $ .00 $ (0.42) $
From discontinued operations .00 $ 6.01 $ 6.28
WEIGHTED AVERAGE
SHARES OUTSTANDING 1,194,756 1,001,299 1,204,756 1,016,731
</TABLE>
See notes to condensed consolidated financial statements.
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<PAGE>
SEAL HOLDINGS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands of dollars)
(Unaudited)
<TABLE>
<CAPTION>
Nine months ended
September 30
1997 1996
------ ------
<S> <C> <C>
OPERATING ACTIVITIES
Net income (loss)from continuing operations $ (509) $
Net income (loss)from discontinued operations 6,389
Adjustments to reconcile net income
(loss) to net cash provided by operating activities:
Depreciation and amortization 5
Changes in operating assets and liabilities
Accounts and notes receivable (80) 3,323
Other assets (178) 429
Accounts payable - trade 24 (3,355)
Interest payable (877)
Other liabilities 250
Changes in net assets of discontinued
operations 86 (7,034)
-------- --------
Net cash provided (required) by
operating activities (652) (875)
INVESTING ACTIVITIES
Purchase of property and equipment (52) (3)
Proceeds from sale of discontinued operations 10,075
Proceeds from sale of furniture and equipment 6
-------- --------
Net cash provided (required)
by investing activities (52) 10,078
FINANCING ACTIVITIES
Decrease in long-term debt of discontinued
operations (9,323)
Increase in capital 101
Purchase of treasury stock (44)
-------- --------
Net cash required by financing activities (44) (9,222)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (748) ( 19)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 2,437 1,055
-------- --------
CASH AND CASH EQUIVALENTS AT
SEPTEMBER 1997 AND 1996 $ 1,689 $ 1,036
======== ========
</TABLE>
See notes to condensed consolidated financial statements.
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SEAL HOLDINGS CORPORATION AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE A -- BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements
have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions
to Form 10-Q and Article 10 of Regulation S-B. Accordingly, they do
not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In
the opinion of management, all adjustments (consisting of normal
recurring accruals and the presentation of prior year's results as
discontinued operations - See Note C) considered necessary for a fair
presentation have been included. All data in the financial statements
is in thousands of dollars except share quantities and per-share amounts.
These financial statements, footnotes and discussions should be read in
conjunction with audited financial statements and related footnotes in the
Seal Fleet, Inc. annual report on Form 10-K for the year ended December 31,
1996 filed with the Securities and Exchange Commission. Operating results
for the three month period and the nine month period ended September, 1997
are not necessarily indicative of the results that may be expected for the
year ending December 31, 1997.
On June 30, 1997, Seal Fleet, Inc. merged into its wholly owned subsidiary,
Seal Holdings Corporation with Seal Holdings Corporation remaining as the
survivor corporation. On that same date, the companies effected a reverse and
forward split of the Company's stock, more fully described in the proxy
statement dated April 11, 1997.
NOTE B - CASH AND CASH EQUIVALENTS
The Company's Cash and Cash Equivalents at September 30, 1997 consisted
of money market and demand deposits of $593, Certificates of Deposit
of $336 and US Government agency bonds of $760. All maturities are of
less than 90 days.
NOTE C - SALE OF DISCONTINUED OPERATIONS
On August 14, 1996, the Company sold all marine assets and ceased all
activities which were related to ownership, management, brokerage, and
operation of offshore supply ships. All related activities for the
three months ended September 30, 1996 and the nine months ended September
30, 1996 have been presented in the accompanying financial statements as
discontinued operations.
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NOTE D - ASSETS HELD FOR RESALE
At December 31, 1996, the Company owned a tract of unimproved land in
Brazoria County, Texas which was recorded at its estimated fair market
value of $154,000. This land was sold to the United States Department
of the Interior's Fish and Wildlife Service for the stated fair market
value. Payment was received during April, 1997.
NOTE E - ORGANIZATION COSTS
At September 30, 1997 Other Assets includes organization costs of $144,000
relating to the company's planned investment in the healthcare industry.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
OVERVIEW
The Company continues its transition from the offshore marine business
to a new line of business within the healthcare industry more fully
described in the Current Report on Form 8-K dated June 10, 1997.
RESULTS OF THE QUARTER ENDED SEPTEMBER 30, 1997
The ongoing activities of the Company during the quarter were related
to the evaluation of investment alternatives within the healthcare
industry, reflected on Form 8-K dated June 10, 1997.
The major elements of expense, offset by interest income from short-term
investments, reflected in the net loss, for the quarter of $61 and year-to
to-date of $509 include:
<TABLE>
<CAPTION>
QTD YTD
--- ---
<S> <C> <C>
Salaries and Benefits $ 62 $140
Contract Labor 4
Legal and Audit 29 181
Business Travel & Entertainment 1 48
Shareholder Relations (29) 122
Office Rent and Supplies 17 23
Other 14 78
----- -----
Sub-Total $ 94 $ 596
Income from operations 8 8
Interest and Dividend Income 27 83
Other Non-operating items (2) ( 4)
----- -----
Net Income (Loss) $(61) $(509)
</TABLE>
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During the three month period ended September 30, 1997, the Company continued
to wind down discontinued operations. There was no impact on earnings from
discontinued operations in that an allowance was set up at December 31, 1996
to cover the estimated future impact of discontinued operations.
PART II. Other Information
Item 1. Legal Proceedings
The Company is not party to any material pending legal proceeding,
other than ordinary routine litigation incidental to the discontinued
business.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
27 Financial Data Statement
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.
SEAL HOLDINGS CORPORATION (Registrant)
Date: November 13,1997 By /s/ James S. Goodner
- - - - - - - - - - - - - -
James S. Goodner
Vice President and
Chief Financial Officer
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<PAGE>
EXHIBIT INDEX
Exhibit Description
- -------- -----------
27 Financial Data Schedule
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<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 1,689
<SECURITIES> 0
<RECEIVABLES> 84
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,923
<PP&E> 110
<DEPRECIATION> (58)
<TOTAL-ASSETS> 2,157
<CURRENT-LIABILITIES> 78
<BONDS> 0
<COMMON> 2,079
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 2,157
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (509)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (509)
<EPS-PRIMARY> (.42)
<EPS-DILUTED> (.42)
</TABLE>
