FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended: June 30, 2000
Commission file number: 000-28453
Ameri-First Financial Group, Inc.
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(exact name of registrant as specified in its charter)
Nevada 84-0849132
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(State of Incorporation) (IRS ID No.)
4514 Cole Avenue, Suite 806, Dallas, Texas 75205
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: 214-599-9050
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Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes [ ] No [ ].
Shares of common stock outstanding at June 30, 2000:
11,146,116
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TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION Page Number
Item 1. Financial Statements 1 - 4
Item 2. Managements's Discussion and Analysis
of Financial Condition and Results of
Operations 5
PART II - OTHER INFORMATION 6
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PART I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
AMERI-FIRST FINANCIAL GROUP, INC.
CONSOLIDATED BALANCE SHEETS
June 30, 2000 and December 31, 1999
ASSETS
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June 30, 2000 Dec 31, 1999
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<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $0 $0
Commission and other receivables 468,733 $346,068
Deposits with clearing organizations 30,642 $221,319
Securities owned 2,100,797 $1,127,388
Investment receivable 205,000
Prepaid expenses 100,539 $100,539
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Total current assets $2,905,711 $1,795,314
PROPERTY AND EQUIPMENT:
Proprty - real estate 34,000,000 0
Furniture and fixtures 36,882 23,224
Vehicles 0 97,437
Computer system 33,444 10,512
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Total property and equipment 34,070,326 131,173
Accumulated depreciation (16,069) (12,191)
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Total property and equipment, net of depreciation 34,054,257 118,982
OTHER ASSETS:
Advance to affiliate 10,000 10,000
Investments 1,500 1,500
Goodwill 168,534
Accumulated amortization - goodwill (1,054)
Intangible assets 79,000
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Total other assets 257,980 11,500
TOTAL ASSETS $37,217,948 $1,925,796
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LIABILITIES AND STOCKHOLDERS' EQUITY
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LIABILITIES
Bank overdraft $9,051 $11,946
Accounts payable and accrued expenses 602,677 $533,743
Payable to clearing organizations 306,300 735,750
Current portion of notes payable
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Total current liabilities 918,028 1,281,439
LONG TERM LIABILITIES
Notes payable 18,950,429 1,308,104
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TOTAL LIABILITIES 19,868,457 2,589,543
STOCKHOLDERS' EQUITY
Common stock, $0.001 par value 11,146 4,706
Additional paid-in-capital 25,242,204 8,138,559
Retained deficit (7,903,859) (9,223,175)
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Total Stockholders' Equity 17,349,491 (1,079,910)
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $37,217,948 $1,509,633
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AMERI-FIRST FINANCIAL GROUP, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
Three months ended June 30, 2000 and 1999
Three months Three months
ended ended
June 30, 2000 June 30, 1999
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<S> <C> <C>
Revenue $1,228,294 $0
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Gross profit $1,228,294 $0
Operating expenses:
Selling expenses 34,766 34,226
Depreciation and amortization 2,014 0
General and administrative 266,952 583,542
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Total Operating Expense 303,732 617,768
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Net operating income 924,562 (617,768)
Other income (expense):
Loss on repossessed assets & sale of business (762,479)
Loss on writeoff of investments (3,685,955)
Interest expense (128,126)
Interest income 5,235 354
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Net income 929,797 (5,193,974)
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Weighted average shares outstanding 6,682,986 4,166,414
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INCOME (LOSS) PER SHARE $0.14 ($1.25)
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AMERI-FIRST FINANCIAL GROUP, INC.
STATEMENT OF STOCKHOLDERS' EQUITY AND ACCUMULATED DEFICIT
December 31, 1999 to June 30, 2000
Common Paid In Accumulated
Shares Amount Capital Deficit Total
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Balance,
December 31, 1999 4,706,114 4,706 7,584,976 (9,223,165) (1,633,483)
Shares issued for 100% of
Ameri-First Securities Corp. 1,890,002 1,890 943,154 945,044
Shares issued for 100% of
Itronics Comm. Corp. 50,000 50 50
Net income - three months
ended March 31, 2000 389,509 389,509
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Balance
March 31, 2000 6,646,116 6,646 8,528,130 (8,833,656) (298,880)
=========== =========== =========== =========== ===========
Paid in capital by shareholder 261,173 261,173
Shares issued for hotel
properties 4,500,000 4,500 16,452,901 16,457,401
Net income - three months
ended June 30, 2000 929,797 929,797
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Balance
June 30, 2000 11,146,116 11,146 25,242,204 (7,903,859) 17,349,491
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AMERI-FIRST FINANCIAL GROUP, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
Three months ended June 30, 2000 and 1999
Three months Three months
ended ended
June 30, 2000 June 30, 1999
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<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $929,797 ($5,193,974)
Adjustments to reconcile net loss to net
cash (used) by operating activities:
Items not requiring cash - depreciation and amortization 2,014
Loss on repossessed assets and sale of business 762,479
Loss on writeoff of investments 3,685,955
(Increase) decrease in current assets (499,337) 7,271
Increase (decrease) in current liabilities (772,701) 13,225
(Increase) decrease in other assets (70,530)
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NET CASH (USED) BY OPERATING ACTIVITIES (410,757) (725,044)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of fixed assets (34,020,686) 0
Disposal of fixed assets (net) 95,427
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NET CASH FROM INVESTING ACTIVITIES (33,925,259) 0
CASH FLOWS FROM FINANCING ACTIVITIES:
Sale of common stock 721,632
Issuance of common stock for assets 16,457,401
Capital contributed by shareholder 261,173
Increase (decrease) in notes payable 17,627,725
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NET CASH FROM FINANCING ACTIVITIES 34,346,299 721,632
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NET INCREASE IN CASH $10,283 ($3,412)
CASH, BEGINNING OF PERIOD (19,334) (8,720)
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CASH, END OF PERIOD ($9,051) ($12,132)
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Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
The Company is engaged in the securities business and investment
banking and through its subsidiary, Ameri-First Securities, Inc., which is a
full service NASD registered broker/dealer.
The Company's liquid position at June 30, 2000 was $1,987,683, which
represented and increase of $1,289,165 over the prior quarter. Most of this
increase came from the stock it received from an investment banking
transaction(s) whose market value at June 30, 2000 was $1,800,000. The increase
in the working capital position represents an increase of 184%. The income also
was $0.14 per share which compares to prior periods when there was always
losses.
In June 2000, the Company purchased five hotels for which it paid
$34,000,000. This amount was paid with $450,000 cash, 17,262,000 in assumed debt
and issued 4,500,000 newly issued restricted common stock of the company. Under
the agreement of purchase, HomeGate Corporation will operate the hotels for a
management fee. The hotels are expected to give the Company a twelve month gross
revenue of $7,000,000 from the hotels with a net income from operations of
approximately $800,000.
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PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
The Company is not involved in any legal proceedings.
Item 2. Changes in Securities.
Registrant has made no changes in its securities.
Item 3. Defaults Upon Senior Securities.
Registrant has no senior securities and accordingly no defaults.
Item 4. Submission of Matters to a Vote of Security Holders.
No matters were presented to a vote of security holders.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports on Form 8-K.
Form 8-K - Acquisition of assets - June 2000
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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.
Ameri-First Financial Group, Inc.
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(Registrant)
BY: /s/ Jeffrey Bruteyn
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Jeffrey Bruteyn
Its: President
DATE: July 31, 2000
Dallas, Texas
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