<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 June 30, 1998
[ ] 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, 1,193,601 shares
outstanding as of August 10, 1998
Class B common stock, par value $.20 per share, 25,000 shares
outstanding as of August 10, 1998
Transitional Small Business Disclosure Format (Check one):
Yes ( ) No (X)
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INDEX
Page
PART I. FINANCIAL INFORMATION
Consolidated Balance Sheets 3
Consolidated Statements of Operations 5
Consolidated Statements of Cash Flows 6
Notes to 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 4. Results of Votes of Security Holders 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
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
June 30, December 31,
1998 1997
(Unaudited) (Audited)
----------- -----------
ASSETS
Current Assets:
Cash, includes $960 of cash $ 357 $ 1,037
equivalents at December 31, 1997
Other receivables 6 8
Prepaid Expenses 16 7
Net assets of discontinued operations (1) 64
-------- --------
Total current assets 378 1,116
Furniture and Equipment
Furniture and equipment 126 118
Less accumulated depreciation (68) (61)
-------- --------
Furniture and equipment, net 58 57
Other Assets
Other assets 18 16
-------- --------
TOTAL ASSETS $ 454 $ 1,189
======== ========
See notes to consolidated financial statements.
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SEAL HOLDINGS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
June 30, December 31,
1998 1997
(Unaudited) (Audited)
----------- -----------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Trade accounts payable and
accrued expenses $ 160 $ 304
Other current liabilities 94 15
-------- -------
Total current liabilities 254 319
-------- --------
TOTAL LIABILITIES 254 319
Shareholders' Equity
Preferred Stock, $.001 par value;
3,000,000 shares authorized; no
shares issued or outstanding.
Class A common stock, $.20 par
value; 14,975,000 shares
authorized and 1,193,601 shares
issued and outstanding at June
30, 1998 and December 31, 1997. 267 267
Class B common stock, $.20 par
value; 25,000 shares authorized,
issued and outstanding at June
30, 1998 and December 31, 1997. 5 5
Additional paid-in capital 4,571 4,571
Retained deficit (4,428) (3,758)
Treasury stock, at cost, 117,522
shares at June 30, 1998 and
December 31, 1997 (95) (95)
Note receivable - shareholder (120) (120)
-------- --------
Total Shareholders' Equity 200 870
-------- --------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 454 $ 1,189
======== ========
See notes to consolidated financial statements.
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SEAL HOLDINGS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in Thousands, except Per Share Amounts)
(Unaudited)
Three Months Ended Six Months Ended
March 31, June 30,
-------------------- ----------------
1998 1997 1998 1997
------ ------ ------ ------
Revenue
Interest and dividend income $ 5 $ 24 $ 14 $ 55
Expenses
Salaries and benefits 126 62 272 92
General and administrative 51 135 194 277
Professional fees 113 114 218 152
------ ------ ------ ------
Loss from continuing operations (285) (287) (670) (466)
Discontinued operations (Note B) - - - -
Net gain (loss) from discontinued
operations - - - -
------ ------ ------ ------
Net loss $ (285) $ (287) $ (670) $ (466)
------ ------ ------ ------
Net income (loss) per share - basic
and dilutive:
From continuing operations $ (.24) $ (.24) $ (.56) $ (.39)
From discontinued operations - - - -
From extraordinary item - - - -
------ ------ ------ ------
$ (.24) $ (.24) $ (.56) $ (.39)
See notes to consolidated financial statements.
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<PAGE>
SEAL HOLDINGS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
Six Months Ended
June 30,
1998 1997
------ ------
Operating Activities:
Net income (loss) from continuing operations $ (670) $ (466)
Net income (loss) from discontinued operations - -
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depreciation and amortization 6 3
Changes in operating assets and liabilities
Accounts and notes receivable - 3
Other assets (16) (36)
Accounts payable - trade (66) 62
Changes in net assets of discontinued
operations 66 86
------ ------
Net cash provided (required) by operating
activities (680) (348)
INVESTING ACTIVITIES
Purchase of property and equipment - (41)
------ ------
Net cash provided (required) by investing
activities - (41)
FINANCING ACTIVITIES
Purchase of treasury stock - (44)
------ ------
Net cash required by financing activities - (44)
DECREASE IN CASH AND CASH EQUIVALENTS (680) (433)
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD 1,037 2,437
------ ------
CASH AND CASH EQUIVALENTS AT JUNE 30, 1998
AND 1997 $ 357 $2,004
======= ======
See notes to consolidated financial statements.
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<PAGE>
SEAL HOLDINGS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A -- Basis of Presentation
The accompanying unaudited 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) 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 Holdings Corporation annual report on Form 10-K for the year ended
December 31, 1997 filed with the Securities and Exchange Commission.
Operating results for the six month period ended June, 1998 are not
necessarily indicative of the results that may be expected for the
year ending December 31, 1998.
NOTE B -- Discontinued operations relates to the Company's prior principal
business of owning and operating offshore supply vessels.
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<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
OVERVIEW
The Company, through its wholly-owned subsidiary, Primary Care Medical
Centers of America, Inc. ("PCMC") continues to develop its business plan
within the healthcare industry as more fully described on Form 10-KSB dated
March 31, 1998, and on Form 8-K dated June 2, 1998.
There can be no assurance that the Company will succeed in developing
fully this business or in operating any business which it may develop.
RESULTS OF THE QUARTER AND YEAR-TO-DATE ENDED JUNE 30, 1998
The major elements of expense, offset by interest income from short-term
investments, reflected in the net loss for the quarter and year-to-date
of $285 and $670 respectively, are as follows:
QTR YTD
------ ------
Salaries and Benefits $ 126 $ 272
Contract Labor 30 68
Legal and Audit 45 150
Business Travel & Entertainment 10 48
Shareholder Relations 17 20
Office Rent and Supplies 17 38
Other 44 88
------ ------
Sub-Total $ 289 $ 684
Income from Operations - 6
Interest and Dividend Income 5 14
Other Non-operating Items (1) (6)
------ ------
Net Loss $ (285) $ (670)
There was no impact on earnings from discontinued operations in that the
allowance for discontinued operations, originally set up at December 31,
1996, continues to cover any expected impact of discontinued operations.
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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 4. Results of Votes of Security Holders
On June 24, 1998, the Company held its annual meeting pursuant to the
notice of meeting announced in the proxy statement dated June 8, 1998.
The results of the voting on the various proposals is as follows:
Proposal 1: The election of directors of the Corporation.
For Withheld Non-Vote
------ -------- --------
Class A Director:
J. Erik Hvide 731,372 3,277 0
Class B Directors:
Thomas M. Ferguson 25,000 0 0
Donald L. Caldera 25,000 0 0
Proposal 2: Ratification of Ernst & Young, LLP as independent auditors.
For Against Abstain Non-Vote
------ ------- ------- --------
758,927 125 522 0
Proposal 3: Approval of the 1998 Incentive Option Plan.
For Against Abstain Non-Vote
------ ------- ------- --------
721,119 37,185 1,300 0
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
27 Financial Data Statement
(b) Reports on Form 8-K.
The Company filed one report on Form 8-K during the quarter ended
June 30, 1998. On June 2, 1998, the Company disclosed a
relationship between Seal's healthcare subsidiary, Primary Care
Medical Centers of America, Inc., and Monsanto Health Solutions.
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<PAGE>
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: August 14, 1998 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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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 357
<SECURITIES> 0
<RECEIVABLES> 6
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 378
<PP&E> 126
<DEPRECIATION> (68)
<TOTAL-ASSETS> 454
<CURRENT-LIABILITIES> 254
<BONDS> 0
<COMMON> 200
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 454
<SALES> 0
<TOTAL-REVENUES> 14
<CGS> 0
<TOTAL-COSTS> 684
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (670)
<INCOME-TAX> 0
<INCOME-CONTINUING> (670)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (670)
<EPS-PRIMARY> (.56)
<EPS-DILUTED> (.56)
</TABLE>
