SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter ended October 31, 1997 Commission File No. 0-8299
CAMELOT CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Colorado 84-0691531
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Camelot Place, 17770 Preston Road, Dallas, Texas 75252
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code: (972) 733-3005
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 the close of the period covered by this
report.
Shares outstanding at
Class October 31, 1997
Common stock, $0.01 par value 1,654,915
<PAGE>
CAMELOT CORPORATION AND SUBSIDIARIES
I N D E X
Page No.
Part I FINANCIAL INFORMATION (UNAUDITED):
Item 1. Consolidated Balance
Sheets 3
Consolidated Statements of
Operations 5
Consolidated Statements of
Cash Flows 7
Notes to Consolidated
Financial Statements 9
Items 2. Management's Discussion
and Analysis of Financial
Condition and Results of
Operations 12
Part II OTHER INFORMATION 15
<PAGE>
CAMELOT CORPORATION AND SUBSIDIARIES
PART I: FINANCIAL INFORMATION
ITEM 1. Financial Statements
CONSOLIDATED BALANCE SHEETS
ASSETS
(In Thousands)
<TABLE>
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October 31, 1997April 30, 1997
(Unaudited) (Audited/Adjusted)
CURRENT ASSETS
Cash and cash equivalents $ 2,141.3 $ 3,667.2
Securities available for sale - 8.3
Accounts receivable, net of
allowance for doubtful accounts
of $19,947 and $19,947 at October
31, 1997 and April 30, 1997 489.3 493.8
Prepaid expenses 94.5 167.8
Inventories, net of allowance for
obsolescence of $630,145 and $494,744 at
October 31, 1997 and April 30, 1997 512.6 644.2
Total current assets 3,237.7 4,981.3
PROPERTY, PLANT AND EQUIPMENT - AT COST
Office equipment and fixtures 2,092.2 2,055.8
Leasehold improvements 64.2 64.2
Less accumulated depreciation (922.5) (800.7)
Total property, plant and
equipment - at cost 1,233.9 1,319.3
OTHER ASSETS
Note receivable - officer, net of allowance
of $889,000 1,025.2 968.2
Preferred stock - related party 530.9 530.9
Licenses and product development, net of
$38,385 and $31,000 accumulated
amortization at October 31, 1997
and April 30, 1997 1,070.8 421.5
Other 50.0 23.1
Total other assets 2,676.9 1,943.7
$ 7,148.5 $ 8,244.3
</TABLE>
<PAGE>
CAMELOT CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
(In Thousands)
<TABLE>
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October 31, 1997April 30, 1997
(Unaudited)(Audited/Adjusted)
CURRENT LIABILITIES
Accounts payable $ 2,409.8 $ 2,642.8
Accrued expenses 180.8 223.0
Total current liabilities 2,590.6 2,865.8
Notes Payable 800.0 -
Total liabilities 3,390.6 2,865.8
STOCKHOLDERS' EQUITY
Common stock, $.01 par value, 50,000,000
shares authorized, 1,684,160 and 881,763
shares issued at October 31, 1997 and
April 30, 1997, respectively 16.8 8.8
Preferred stock, $.01 par value, 100,000,000
shares authorized, 1,453,351 and 2,438,056
shares issued and outstanding at
October 31, 1997 and April 30, 1997
respectively 14.5 24.4
Additional paid-in capital 38,941.9 38,737.1
Accumulated deficit (32,376.6) (30,597.5)
Less: treasury stock, at cost, 29,245 and
28,745 shares at October 31, 1997 and
April 30, 1997 (2,756.7) (2,715.7)
Dividends (1.0) -
Notes receivable related to purchase of
common stock (81.0) (78.6)
Total stockholders' equity 3,757.9 5,378.5
$ 7,148.5 $ 8,244.3
</TABLE>
See accompanying notes to these consolidated financial statements.
<PAGE>
CAMELOT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(In Thousands, Except Share and Per Share Data)
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Three Months Ended
October 31,
1997 1996
REVENUE $ 26.4 $ 196.6
COST OF SALES 106.5 863.4
GROSS PROFIT (LOSS) (80.1) (666.8)
OPERATING EXPENSES:
General and administrative 623.7 1,621.7
Provision for Inventory E&O 135.0 387.0
Depreciation and
amortization 64.4 198.8
823.1 2,207.5
LOSS FROM OPERATIONS (903.2) (2,874.3)
OTHER INCOME (EXPENSES):
Interest expense - -
Interest income 39.2 106.4
Dividend income - affiliate 11.7 11.6
Gain (Loss)on disposition of
assets 2.4 643.9
Other - (656.7)
Total other income(expense) 53.3 105.2
INCOME (LOSS) FROM CONTINUING
OPERATIONS (849.9) (2,769.1)
DISCONTINUED OPERATIONS:
Loss on disposal - (.8)
- (.8)
NET INCOME (LOSS) (849.9) (2,769.9)
DIVIDENDS ON PREFERRED STOCK 3.7 (4.8)
NET INCOME (LOSS) ATTRIBUTABLE TO
COMMON STOCKHOLDERS $ (846.2) $ (2,774.7)
INCOME (LOSS) PER SHARE:
Income (loss) from continuing
operations $ (.539) $ (4.498)
Loss from discontinued operations (.000) (.001)
Dividends on preferred stock .002 (.008)
NET INCOME (LOSS) PER COMMON SHARE$ (.537) $ (4.507)
WEIGHTED AVERAGE OF COMMON
STOCK OUTSTANDING 1,576,135 615,681
</TABLE>
See accompanying notes to these consolidated financial statements.
<PAGE>
CAMELOT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(In Thousands, Except Share and Per Share Data)
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Six Months Ended
October 31,
1997 1996
REVENUE $ 1,688.4 $ 963.6
COST OF SALES 2,161.7 1,191.8
GROSS PROFIT (LOSS) (473.3) (228.2)
OPERATING EXPENSES:
General and administrative 2,877.9 3,904.7
Provision for Inventory E & O 135.0 387.0
Depreciation and amortization 191.0 416.7
3,203.9 4,708.4
LOSS FROM OPERATIONS (3,677.2) (4,936.6)
OTHER INCOME (EXPENSES):
Interest expense (43.1) (3.1)
Interest income 94.8 216.9
Dividend income - affiliate 23.3 23.3
Gain (Loss) on disposition of assets 3.4 (656.7)
Other - -
Total other income (expense) 78.4 (419.6)
INCOME (LOSS) FROM CONTINUING
OPERATIONS (3,598.8) (5,356.2)
DISCONTINUED OPERATIONS:
Loss on disposal (.4) (413.9)
(.4) (413.9)
NET INCOME (LOSS) (3,599.2) (5,770.1)
DIVIDENDS ON PREFERRED STOCK (1.0) (78.0)
NET INCOME (LOSS) ATTRIBUTABLE TO
COMMON STOCKHOLDERS $ (3,600.2) $ (5,848.1)
INCOME (LOSS) PER SHARE:
Income (loss) from
continuing operations $ (2.707) $ (9.108)
Loss from discontinued
operations (.000) (.704)
Dividends on preferred stock (.001) (.133)
NET INCOME (LOSS) PER COMMON SHARE $ (2.708) $ (9.945)
WEIGHTED AVERAGE OF COMMON
STOCK OUTSTANDING 1,329,300 588,060
</TABLE>
See accompanying notes to these consolidated financial statements.
CAMELOT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In Thousands)
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Six Months Ended
October 31,
1997 1996
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income(loss) $ (3,599.1) $(5,769.5)
ADJUSTMENTS TO RECONCILE NET GAIN (LOSS) TO
NET CASH FROM OPERATING ACTIVITIES:
Depreciation and amortization 200.2 405.7
(Gain) loss on disposal of assets 14.5 656.7
Write-off (provision) uncollectible
accounts receivable - (6.1)
Non Cash transaction for securities 100.0 -
Provision for inventory obsolescence 135.4 387.0
Write-Down of License Agreement 453.3 -
Change in assets and liabilities
Accounts and accrued receivables 154.2 (127.6)
Prepaid expenses 73.2 80.8
Inventories 185.6 (182.2)
Accounts payable and accrued expenses 320.8 179.1
Net cash used by operating activities (1,961.9) (4,376.1)
CASH FLOW FROM INVESTING ACTIVITIES:
Purchases of property and equipment (42.6) (1,491.9)
Purchases of marketable securities - (1,230.1)
Proceeds from sale of
property and equipment 8.2 1,731.4
Disposition of assets of discontinued
operations - -
Loan to Director of Company (59.4) (1,000.0)
Deposits 9.2 -
Licenses and product development (688.6) (294.7)
Net cash used by investing activities (773.2) (2,285.3)
CASH FLOW FROM FINANCING ACTIVITIES:
Sale of common stock 5.0 2,319.6
Sale of preferred stock - 1,947.5
Proceeds from notes payable 800.0 -
Dividends on preferred stock (1.0) (78.0)
Purchase of Treasury Stock (41.0) -
Net cash provided by
financing activities 763.0 4,189.1
NET INCREASE (DECREASE) IN CASH (1,972.1) (2,472.3)
CASH AT BEGINNING OF PERIOD 4,113.4 9,870.6
CASH AT END OF PERIOD $ 2,141.3 $ 7,398.3
SUPPLEMENTAL INFORMATION:
Cash paid for interest $ 71.2 $ 6.1
</TABLE>
See accompanying notes to these consolidated financial statements.
<PAGE>
CAMELOT CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In Thousands)
NONCASH INVESTING AND FINANCING ACTIVITIES
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Six Months Ended
October 31,
1997 1996
During the quarter ended October 31, 1996,
the Company (643.9)
recognized a loss on the August 1996 disposal of the
remaining investment in Firecrest.
During the period under review, Meteor
Technology, plc expensed the UK, Ireland
Distribution Rights to DigiPhone. (453.5)
During the period under review, Meteor
Technology issued shares in settlement
for rent obligations for property previously
occupied by Telecredit Telekommunications GmbH (318.4)
During the period under review, Camelot issued
shares for commission expense related to the
$800,000 funding (100.0)
During the quarter ended October 31, 1997, the Company's
preferred stock was converted to common stock as follows:
2,330,000 Series I preferred for 701,819 shares of
restricted common
<PAGE>
CAMELOT CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
ITEM 1. Financial Statements and Principles of Consolidation
The accompanying condensed consolidated financial statements have been
prepared in accordance with the instruction to Form 10-Q, and 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 adjustments) considered necessary for a fair presentation
have been included. These statements should be read in conjunction
with the audited financial statements and notes thereto included in
the Registrant's annual Form 10-K filing for the year ended April 30,
1997 and Form 8-K issued May 20, 1997, along with subsequent
amendments. On May 20, 1997 Camelot announced an acceptance to a
stock subscription for 53,811,780 restricted Preferred Shares, Series
J by Adina, Inc., a Delaware public company. Adina paid for the
subscription with the transfer of 6,029,921 restricted common shares
of Alexander Mark Investments (USA), Inc. ("AMI"), representing 80% of
the outstanding share capital of AMI. AMI owns 57% of Meteor
Technology plc a public U.K. Company which has two operating
subsidiaries, DigiPhone International Ltd. and Meteor Payphones, Ltd.
35,688,560 of the Preferred Shares are issued upon closing and
18,123,220 of the Preferred Shares are issued upon the issuance of new
common shares of the Registrant on a one for one basis. The Preferred
Shares are non-convertible, non-yielding, have a preference over the
common shares but subordinate to the outstanding Preferred Shares and
have one vote per share voting with the common shares. The
Registrant's April 30, 1997 financial statements have been restated
and adjusted to reflect the consolidation as a result of the May 1997
transactions.
The restated accounts are as follows:
</TABLE>
<TABLE>
Camelot Corporation Consolidated
Balance Sheet
(in Thousands )
<S> <C> <C> <C> <C> <C>
Original Restated
30-Apr-97 30-Apr-97 Adjustments
ASSETS
Current Assets:
Cash $3,030.0 $3,667.2 $ 637.2 (1)
Accounts & Notes
Receivable 162.6 493.2 331.2 (2)
Inventory 530.9 644.2 113.3 (3)
Total Current
Assets 3,899.6 4,981.3 1,081.7
Property and
Equipment:
Net
Equipment 928.8 1,319.3 390.5 (4)
Total
Assets $6,772.1 $8,244.3 $1,472.2
<PAGE>
LIABILITIES &
STOCKHOLDER' S
EQUITY
Current Liabilities:
Accounts &
notes payable $ 693.6 $ 2,865.8 $ 2,172.2 (5)
Total
Liabilities 693.6 2,865.8 2,172.20
Stockholder's
Equity:
Additional
Paid-in 34,021.4 38,737.1 4,715.7 (6)
Capital
Treasury
Stock (2,714.6) (2,715.7) (1.1) (7)
Retained
Earnings (25,261.5) (30,676.1) (5,414.6) (8)
$ 6,772.1 $ 8,244.3 $ 1,472.2
Camelot Corporation
Consolidated Statement of Operations
(in Thousands except EPS)
Original Restated
30-Apr-97 30-Apr-97 Adjustments
REVENUES
Sales
1,887.6 4,132.2 2,244.6
Cost
of 1,559.2 4,321.7 2,762.5
Sales
Gross
Profit 328.4 (189.5) (517.9) (9)
Operating
Expenses:
Administrative 9,122.8 11,478.8 2,356.0
Expenses
Other
Expense 4,202.0 4,234.3 32.3
Total
Operating 13,324.8 15,713.1 2,388.3 (10)
Expenses
Dividends on
Preferred (95.2) (95.3) (0.1)
Stock
Net Loss (13,091.6) (15,997.9) (2,906.3)
(1) The increase is due to the cash held on hand by Meteor as of May
30, 1997.
(2) The increase is due to the inclusion of amounts due from
creditors within one year from the Meteor accounts.
(3) The increase is due to the inventory held by Meteor Payphones
Ltd., a wholly owned subsidiary of Meteor.
(4) The increase is due to the equipment held by Meteor and its
subsidiaries.
(5) The increase is due to the inclusion of the amounts due by Meteor
to its creditors.
(6) The increase is due to the amount of additional paid-in-capital
of Meteor.
(7) This increase reflects the Camelot common shares held by Meteor.
(8) This decrease reflects the loss of Meteor.
(9) The loss results because of the elimination of the sale of the
PCAMS software from Meteor to Camelot.
(10) The increase in the operating expenses and therefore the net
loss results from operating expenses by Meteor.
</TABLE>
On December 3, 1997 Camelot announced that it has entered into a
conditional agreement to acquire 100% of the issued share capital of
DigiPhone International Ltd. the London based company that is the
exclusive worldwide distributor of VideoTalk. Following the
acquisition Camelot will own 100% of all the rights, title and
interests to VideoTalk. The agreement is conditional on the
shareholders of both Camelot and Meteor approving this transaction.
This transaction will have no material impact on the financial
statements of Camelot because Digiphone International as a wholly
owned subsidiary of Meteor is consolidated into the Camelot financial
statement presentation. The consideration paid by Camelot being the
cancellation by Meteor of its 500,000 pound 1997-2007 loan stock owed
to Camelot is not apparent in the financial statements as that entry
would eliminate upon consolidation of the Camelot accounts.
New Accounting Standard in February 1997: the Financial Accounting
Standards Board issued Statement of Financial Accounting Standards No.
128 (SFAS 128), Earnings per Share, which establishes new standards
for computing and presenting earnings per share. SFAS 128 is effective
for financial statements issued for periods ending after December 15,
1997 and requires restatement of all prior-period earnings per share
data. Early application of SFAS 128 is not permitted. The Company's
adoption of the provisions of SFAS 128 will result in the dual
presentation of basic and diluted earnings per share on the Company's
statement of operations.
The Company believes that the Year 2000 issue (the cost of making its
internal systems Year 2000 compliant as well as the cost to the
Company of making its clients' systems Year 2000 compliant where it is
obligated to do so) will not have a material adverse effect on its
results of operations.
Forward Looking Statements: All statements other than historical
statements contained in this Report on Form 10-Q constitute "forward
looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Without limitation, these forward
looking statements include statements regarding the Company's business
activities. Any Form 10-K, Annual Report to Shareholders, Form 10-Q
or Form 8-K of the Company may include forward looking statements. In
addition, other written or oral statements which constitute forward
looking statements have been made or may in the future be made by the
Company, including statements regarding future operating performance,
short- and long-term revenue and earnings growth, the value of
contract signings, and industry growth rates and the Company's
performance relative thereto. These forward looking statements rely on
a number of assumptions concerning future events, and are subject to a
number of uncertainties and other factors, many of which are outside
of the Company's control, that could cause actual results to differ
materially from such statements. These include, but are not limited
to: competition in the technology industry and the impact of such
competition on pricing, revenues and margins; the market acceptance of
new product or service offerings that offer higher margins than
traditional product or service offerings and costs associated with the
development and marketing of such offerings; the financial performance
of current and future contracts, the degree to which the Company can
improve productivity; general economic conditions; the degree to which
business entities continue to upgrade technology and business
processes; the cost of attracting and retaining highly skilled
personnel. The Company disclaims any intention or obligation to update
or revise any forward looking statements whether as a result of new
information, future events or otherwise.
The consolidated financial statements include the accounts of the
Company, all majority owned subsidiaries and the majority owned
company, Alexander Mark Investments (USA), Inc. ("Alexander Mark").
Alexander Mark is the majority owner of Meteor Technology, plc
("Meteor"). The April 30, 1997 adjusted balance sheet consolidates
numbers from the April 30, 1997 Audited Financial Statements of the
Company, the April 30, 1997 Audited Financial Statements of Alexander
Mark and the May 31, 1997 adjusted Audited Financial Statements of
Meteor and its subsidiaries. Adjustments were made to eliminate
intercompany transactions and for the conversion of Meteor's numbers
from pounds to US Dollars. Accumulated deficit increased by
$1,779,100 which represents the portion of earning recognized in the
first six months that were not shown in the April 30, 1997 balance
sheet.The Meteor financial presentation is based on the accounting
rules of the United Kingdom. The balance sheet reflects adjustments
to present financial statements per US GAAP accounting rules. The
adjustments included presenting current assets first on the balance
sheet, reclassing creditors payable due within one year to the
liability section from the current asset section and combining reserve
amount and profit and loss account into retained earnings. The assets
and liability amounts were not changed.The accounting rules of the
United Kingdom only require financial statements of public companies
to be published every six months. Meteor's fiscal year end is May 31
and their last six month Interim Financials were issued for November
30, 1996. The six month results for the period ending October 31, 1997
and 1996 include the published six month results of Meteor for periods
commencing on December 1, 1995 and 1996 and ending on May 31, 1996 and
1997, respectively.The financial statements include the 20 per cent
minority interest in the outstanding voting share capital of Alexander
Mark not owned by the Company. Meteor's financial statements were
converted from British Pounds to US Dollars based on US accounting
guidelines. The conversion rate for the balance sheet was based on
the published exchange rate at October 31, 1997 and April 30, 1997,
one pound equals $1.67 and $1.62, respectively. The conversion used
for the statement of operations was based on an average exchange rate
for the six months ended October 31, 1997 and 1996. This conversion
rate was one pound equals $1.65 for period ended May 31, 1997 and
$1.53 for period ended May 31, 1996.
ITEM 2. Management Discussion and Analysis of Financial Condition
and Results of OperationsThe Company's revenue for the quarter ended
October 31, 1997 was $26,400 compared with $196,600 in the comparable
quarter of 1996. Net loss for the three month period was $849,900
compared with a loss of for the previous year of $2,769,900. The
Company has reduced its administrative expenses in cost saving effort.
These results are due to the restructuring by Meteor of the newly
acquired payphone business in the United Kingdom and the continued
expenditure by Third Planet on the development of Internet products,
primarily VideoTalk. Further, a write down of $453,500 was made by
Meteor of the Digiphone UK distribution rights to comply with UK
accounting requirements.
VideoTalk is a complete hardware and software system which, when
connected to a multimedia PC, enables full duplex video conferencing
over the Internet and over local and wide area networks. It uses a
PCI plug-and-play add-in card that provides high quality audio and
video while achieving extremely low processor load. VideoTalk does
not require a soundcard or a video capture card, and allows
communication over the Internet with only a 28.8 Kbps modem. The unit
includes the VideoTalk card, a color video camera, a special version
of the Proficia telephony handset, and both the VideoTalk and
Digiphone 2.0 software. The consolidated balance sheets for the period
show stockholders' equity of $3,757,900 compared with $5,378,500 for
the financial year ended April 30, 1997. Total assets were $7,148,500
compared with $8,244,300 for the comparable period. The decrease in
stockholders' equity and total assets was due to the operating loss as
noted above.
Subsequent to the period, the Company announced that it has entered
into a conditional agreement to acquire 100% of the issued share
capital of DigiPhone International Ltd. ("DI"), the London based
company that is the exclusive worldwide distributor of VideoTalk.
Following this acquisition Camelot will own 100% of all the rights,
title and interests to VideoTalk through its wholly owned subsidiaries
Third Planet Publishing, Inc. (which owns the technology rights to
VideoTalk) and DI (which owns the marketing rights to VideoTalk).
The consideration will be $828,250 payable by the cancellation of
outstanding loan stock owed to Camelot by the seller, Meteor
Technology plc ("Meteor"). Meteor is 57% owned by Alexander Mark
Investments (USA), Inc. which is in turn 80% owned by Camelot. The
agreement is conditional on the shareholders of both Camelot and
Meteor approving this transaction.
Management believes that this Form 10-Q accurately reflects the
current status of the Company after taking into account the May 1997
transactions and the December transaction, including a restatement of
the April 30, 1997 audited financial statements. The December
transaction has no material impact on the financial presentation as
the Digiphone International financial impact and the cancellation of
the loan stock is already accounted for due to the consolidation and
restatement.
Management continues to concentrate the majority of its management and
financial resources on the development and successful marketing of
Internet related software and hardware products produced by its
subsidiary, Third Planet Publishing, and continues to anticipate that
its principal revenue and profitability will emanate from these
hardware and software products. As previously announced, the Company
has commenced negotiations with major Original Equipment Manufacturers
to license its technology.
Liquidity and Capital ResourcesNet cash used by operating activities
for the six months ended October 31, 1997 was $1,961,900 compared with
$4,376,100 in 1996. Net cash used by investing activities was
$773,200 compared with $2,285,300 in 1996. Net cash provided by
financing activities was $763,000 compared with net cash provided of
$4,189,100 in 1996. The Company issued convertible debentures during
the period and accepted a convertible preferred shares subscription.
These debentures and preferred shares are convertible into common
shares. Due to the Company's inability to complete a Form S-3 filing,
the subscriber has requested that the subscription be issued pursuant
to a Regulation S exemption. Prior to the Company agreeing the
subscriber must provide appropriate representations to the Company.
Management believes the subscriber will be able to comply and will
take the appropriate action upon receipt of such representations.
Cash and securities of $2,141,300 compares with $3,675,500 at April
30, 1997. The Securities available for sale were reclassified due to
the acquisitions in May of 1997.The Company's plans for capital
expenditures relate principally to the purchase of property and
equipment to further its hardware and software development program.
Management believes that its Internet products and its payphone
operations will generate its principal revenues and cash flow for the
Company during the next twelve months. Management believes that the
anticipated level of revenue generated by the Company together with
the present level of cash resources available to the Company will be
sufficient for its needs. However, Management believes that
additional cash resources may be needed if the anticipated level of
revenues are not achieved, or are not achieved timely. Management
believes that should the Company require additional cash resources, it
can raise additional resources from the sale of Common and Preferred
Stock and/or by incurring borrowing. There are no known trends,
demands, commitments, or events that would result in or that is
reasonably likely to result in the Company's liquidity increasing or
decreasing in a material way other than the potential use of cash
resources for investment in the Company's subsidiaries in the normal
course of business. The Company continually reviews funding options
which could materially increase the Company's liquidity.<PAGE>
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
- None-
Item 5. Exhibits and Reports on Form 8-K.
(a) Exhibits:
3(1) Articles of
Incorporation: Incorporated by reference to
Registration Statement
filed
on Form 10, June 23,
1976.
3(2) Bylaws: Incorporated by
reference as
immediately above.
(10) 1991 Incentive Stock
Option Plan: Incorporated by reference to
proxy statement for 1991.
(b) Reports on Form 8-K: Form 8-K dated May 20,
1997
with amendments.
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 thereto duly authorized.
CAMELOT CORPORATION
(Registrant)
By: /s/ Daniel Wettreich
DANIEL WETTREICH,
President
By: /s/ Robert Gregory
ROBERT GREGORY, Chief
Financial Officer and Principal Financial Officer
Date: December 9, 1997
<TABLE> <S> <C>
<ARTICLE> 5
<RESTATED>
<CIK> 0000013033
<NAME> CAMELOT CORPORATION
<S> <C>
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