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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 10-QSB
Quarterly report under section 13(d) or 15(d) of the Securities Exchange Act of
1934 for the quarterly period ending March 31, 2000
Commission File Number: 000-28415
International Environmental Management, Inc.
(Exact name of Small Business Issuer as specified in its charter)
NEVADA 65-0861102
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(State or other jurisdiction (IRS Employee
of incorporation or organization) Identification Number)
5801 Wiley Street Hollywood Florida 33023
(Address of principal executive offices and Zip code)
(954) 961-3033
(Issuer's Telephone Number)
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Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirement for the past 90 days.
Yes X No
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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: March 31, 2000 - 1,000,000 (one
million) Common Shares, $.001 par value.
Transitional Small Business Disclosure Format: (check one)
Yes X No
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INDEX
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PART I. FINANCIAL INFORMATION 3
Item 1. Financial Statements 3
Balance Sheets 4
Liabilities and Shareholders's Equity 4
Statements of Operations 5
Statements of Cash Flow 6
Notes to Financial Statements 7
Item 2. Management's Discussion and Analysis or Plan of Operation 8-9
PART II. Other Information 9
Item 6. Reports of Form 8-K 9
Signatures 10
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PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
The following sets forth the financial statements for the first quarter
1999 compared to the first quarter of 2000. The financial statements should be
read in conjunction with the Company's Form 10-KSB for the year ended December
31, 1999.
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INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED BALANCE SHEETS
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<CAPTION>
ASSETS MARCH 31, 2000 DECEMBER 31, 1999
(UNAUDITED) (AUDITED)
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Current Assets:
Cash and Cash Equivalents $ 0 $ 0
Inventory 9,132 19,167
Loans to Stockholders 9,522 0
Total Current Assets 18,654 19,167
Property, Plant and Equipment (Net of $8,929 and $5,859
accumulated depreciation at March 31, 2000 and
December 31, 1999) 266,320 269,390
Other Assets:
Organizational Costs (Net of $733 and $693
accumulated amortization at March 31, 2000 and
December 31, 1999) 67 107
Deposits 340 340
Total Other Assets 407 447
Total Assets $ 285,381 $ 289,004
==================================
LIABILITIES AND STOCKHOLDER'S EQUITY
Current Liabilities:
Cash Overdraft $ 13,142 $ 1,246
Accounts Payable and Accrued Expenses 115,654 117,486
Customer Deposits 17,304 18,152
Notes Payable - Current Portion 27,045 26,592
Total Current Liabilities 173,145 163,476
Long Term Liabilities
Notes Payable 150,847 158,342
Total Liabilities 323,992 321,818
Stockholders' Equity:
Common Stock, $.001 Par Value; 25,000,000
Shares Authorized; 3,500,000 Issued and
Outstanding 3,500 3,500
Additional Paid In Capital 422,772 422,772
Accumulated Deficit (233,238) (161,441)
Accumulated Deficit During Development Stage (171,145) (171,145)
21,889 93,686
Less: Subscriptions Receivable (60,500) (126,500)
Total Equity (38,611) (32,814)
Total Liabilities and Stockholders' Equity $ 285,381 $ 289,004
==================================
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INTERNATIONAL ENVIRONMENTAL MANAGEMENT INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2000
(UNAUDITED)
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<CAPTION>
2000 1999
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Revenues $ 241,334 $ 0
Cost of Goods Sold 183,981 0
Gross Profit 57,353 0
Salaries and Wages 59,150 0
Other General and Administrative Expenses 64,620 88
Total Operating Expenses 123,770 88
Income (Loss) Before Other Income (Expense) and
Provision for Income Taxes (66,417) (88)
Interest Expense 5,380 0
Income (Loss) Before Provision for Income Taxes (71,797) (88)
Provision for Income Taxes 0 0
Net Income (Loss) $ (71,797) $ (88)
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Loss Per Common Share $ (0.0205) $ Nil
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Weighted Average Common Shares Outstanding 3,500,000 1,900,000
==========================
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INTERNATIONAL ENVIRONMENTAL MANAGEMENT INC. AND SUBSIDIARY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2000
(UNAUDITED)
<TABLE>
<CAPTION>
2000 1999
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Cash Flow from Operating Activities:
Net (Loss) $(71,797) $ (88)
Adjustments to Reconcile Net Loss to Net Cash Used For
Operating Activities:
Depreciation and Amortization 3,110 40
Changes in Assets and Liabilities:
(Increase) Decrease in Inventory 10,035 0
(Increase) Decrease in Loans to Stockholders (9,522) 0
Increase (Decrease) in Cash Overdraft 11,896 0
Increase (Decrease) in Accounts Payable and Accrued
Expenses (1,832) 48
Increase (Decrease) in Customer Deposits (848) 0
Net Cash Used in Operating Activities (58,958) 0
Cash Flow from Financing Activities:
Reduction in Notes Payable (7,042) 0
Decrease in Subscriptions Receivable 66,000 0
Net Cash Used in Financing Activities 58,958 0
Net increase (decrease) in Cash 0 0
Cash - Beginning 0 56
Cash - Ending $ 0 $ 56
========================
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INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2000 (UNAUDITED)
1. Basis of Presentation - The unaudited condensed consolidated financial
statements include the accounts of the Company and its subsidiary. Intercompany
balances have been eliminated in consolidation.
2. Interim Financial Information - The financial information contained herein is
unaudited but includes all normal and recurring adjustments which, in the
opinion of management, are necessary to present fairly the information set
forth. The unaudited condensed consolidated financial statements should be read
in conjunction with the consolidated financial statements, which are included in
the Company's Annual Report on Form 10-KSB for the year ended December 31, 1999.
The Company's results for interim periods are not necessarily indicative of
results to be expected for the fiscal year of the Company ending December 31,
2000. The Company believes that this Quarterly Report filed on Form 10-QSB is
representative of its financial position, its results of operations and its cash
flows for the periods ended March 31, 2000 and 1999 covered thereby.
3. Comprehensive Income - In June 1997, the Financial Accounting Standards Board
issued Statement of Financial Accounting Standards No. 130 ("SFAS 130"),
"Reporting Comprehensive Income." SFAS 130 requires companies to disclose
comprehensive income and its components. The Company currently has no items of
other comprehensive income and therefore SFAS 130 does not apply.
4. Legal Proceedings - The Company is not currently party to any legal
proceedings.
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ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The following discussion is intended to assist in an understanding of
the Company's results of operations for the first quarter of 1999 compared to
the first quarter of 2000.
Forward-Looking Information
This report contains certain forward-looking statements and information
relating to the Company that are based on the beliefs of its management as well
as assumptions made by and information currently available to its management.
When used in this report, the words "anticipate", "believe", "estimate",
"expect", "intend", "plan", and similar expressions as they relate to the
Company or its management, are intended to identify forward-looking statements.
These statements reflect management's current view of the Company with respect
to future events and are subject to certain risks, uncertainties, and
assumptions. Should any of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary materially from
those described in this report as anticipated, estimated or expected. The
Company's realization of its business aims could be materially and adversely
affected by risks and uncertainties, including but not limited to economic,
competitive, governmental and technological factors affecting the Company's
operations, markets, products, services, prices and other factors.
Results of Operations
IEMI's net revenues for Q1 2000 increased by 92% compared to Q1 1999.
(The 1999 numbers for comparison are Broward Recycling, prior to the acquisition
by IEMI in June of 1999). The Company's revenue increase is directly related to
local sales and marketing efforts, and expansion of its international business
segments. During the first quarter, 2000, IEMI started recycling cruise ship
aluminum cans from international (mainly Caribbean) ports.
The Company expects revenue for the second quarter of 2000 to be up from
the first quarter revenue of $241,334. Revenue is partly a function of the mix
of recyclable material types and the instability of the metals market, which is
difficult to predict. Revenue is also subject to the impact of the economic
conditions in the various geographic regions that the Company services, both
domestically and internationally.
IEMI's loss for Q1 2000 increased by $70,000 from Q1 1999. On a per
share basis, the Company lost $ (.02) per common share in Q1 2000 versus nil in
the Q1 1999 period. The loss is attributable to the expansion and acquisition
plan the company has put forward for the year 2000, which has resulted in
general and administrative expenses. Without the acquisition expenses, the
Company would have been profitable in the first quarter of 2000. Spending on its
acquisition plan will continue throughout the year 2000.
The Company anticipates that the gross profit percentage to increase in
the second quarter
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and for that trend to continue for the rest of 2000. IEMI's gross margin
percentages in any period varies dependent on the product mix, as well as the
needs of the metals market, and supply and demand conditions. The Company is
implementing new cost control measures to increase gross margins. Various other
factors such as metals yield and inventory levels will also continue to affect
the amount of cost of sales and the variability of gross margin percentages.
A worse case scenario involving a critical supplier of raw materials
would be the partial or complete shutdown of the supplier and its resulting
inability to provide materials to the Company on a timely basis. While efforts
to work with suppliers continues, contingency planning has emphasized the
identification of secondary sources.
The Company does not expect a change in tax rate and anticipates no
corporate income tax for the year 2000.
The Company is pursuing a listing on the OTC-BB during the second
quarter of 2000. It became a fully reporting firm on February 6, 2000.
IEMI is not currently party to any legal proceedings.
The Company continues to receive financial support from its venture
capitalist and is committed to receiving funds in excess of $400,000 during the
remainder of year 2000.
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8K
NONE
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
INTERNATIONAL ENVIRONMENTAL MANAGEMENT, INC.
By: /s/ Harold Solomon
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Harold Solomon
President
Dated: May 16, 2000
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<ARTICLE> 5
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 9,522
<ALLOWANCES> 0
<INVENTORY> 9,132
<CURRENT-ASSETS> 18,654
<PP&E> 275,249
<DEPRECIATION> 8,929
<TOTAL-ASSETS> 285,381
<CURRENT-LIABILITIES> 173,145
<BONDS> 0
0
0
<COMMON> 3,500
<OTHER-SE> (42,111)
<TOTAL-LIABILITY-AND-EQUITY> 285,381
<SALES> 0
<TOTAL-REVENUES> 241,334
<CGS> 183,981
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 123,770
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 5,380
<INCOME-PRETAX> (71,797)
<INCOME-TAX> 0
<INCOME-CONTINUING> (71,797)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (71,797)
<EPS-BASIC> (.02)
<EPS-DILUTED> (.02)
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