ANNUAL REPORT FOR SMALL BUSINESS ISSUERS SUBJECT
TO THE 1934 ACT REPORTING REQUIREMENTS
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-KSB
[X] ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [Fee Required]
For the Fiscal Year ended September 30, 1996
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [No Fee Required]
For the transition period from ________ to ________
Commission file number 0-8463
PISMO COAST VILLAGE, INC.
-------------------------
(Name of small business issuer in its charter)
California 95-2990441
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(State or other jurisdiction (IRS Employer ID Number)
of incorporation or organization)
165 South Dolliver Street, Pismo Beach, CA 93449
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(Address of Principal Executive Offices) (Zip Code)
Issuer's telephone number (805)773-5649
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Each
Exchange
on Which Registered.
N/A N/A
Securities registered pursuant to Section 12(g) of the Act:
Common Stock
---------------
(Title of Class)
<PAGE> 1/40
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 requirements for the 90 days past. YES XX NO __
Check if there is no disclosure of delinquent filers in
response to Item 405 of Regulation S-B is not contained in this
form, and no disclosure will be contained, to the best of
registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. XX
State issuer's revenues for its most recent fiscal year. $2,585,052
State the aggregate market value of the voting stock held by
non-affiliates computed by reference to the price at which the
stock was sold, or the average bid and asked prices of such
stock, as of a specified date within the past 60 days (See
definition of affiliate in Rule 12b-2 if the Exchange Act).
$ 16,824,500
State the number of shares outstanding of each of the
issuer's classes of common equity, as of the latest practicable
date. 1,800
<PAGE> 2/40
FORM 10-KSB PART I
ITEM 1 DESCRIPTION OF BUSINESS
(a) GENERAL DEVELOPMENT OF BUSINESS
Pismo Coast Village, Inc., the "Registrant" or the "Company" was
incorporated under the laws of the State of California on April
2, 1975. The Company's sole business is owning and operating a
recreational vehicle resort (hereinafter the "Resort") in Pismo
Beach, California. The Resort has continued to enhance its
business by adding other service centers related to the repair
and storage of recreational vehicles.
(b) BUSINESS OF ISSUER
The Company is engaged in only one business, namely, the
ownership and operation of the Resort. The Company generates
revenue from rental of camping sites, recreational vehicle
storage, recreational vehicle repair and retail sales from a
general store and recreational vehicle parts store. Accordingly,
all of the revenues, operating profit (loss) and identifiable
assets of the Company, are attributable to a single industry
segment.
Pismo Coast Village, Inc., is a full service 400 space
recreational vehicle resort. Its operations include site
rentals, trailer rentals, RV storage space and a retail
operation. The retail operations include a general store, video
arcade, laundromat, RV parts store and RV repair shop. In
addition, the Company has a recreation department that provides a
youth program and recreational equipment rentals.
PUBLIC AND SHAREHOLDER USERS
The present policy of the Company is to offer each shareholder
the opportunity for 45 days of free use of sites at the Resort,
25 days may be used during prime time and 20 days during non-prime
time. The free use of sites by shareholders is managed by
designating the days of the year as prime time and non-prime
time. A prime time day is one that is most in demand, for
example Memorial Day weekend and the period from mid-June until
Labor Day. Non-prime time is that time with the least demand.
Each shareholder is furnished annually a calendar that designates
the prime and non-prime time days, it also provides a schedule of
when reservations can be made and the procedure for making
reservations. Shareholders free use of sites average
approximately 20% to 21% annually, refer to Results of Operations
MD&A, page 10.
SEASONAL ASPECTS OF BUSINESS AND EFFECT ON CAPITAL
The business of the Company is seasonal and is concentrated
during prime days of the year which are defined as follows:
Washington's birthday, Easter week, Memorial Day weekend, summer
vacation months, Labor Day, Thanksgiving weekend and Christmas
vacation.
<PAGE> 3/40
WORKING CAPITAL REQUIREMENTS
By accumulating reserves during the prime season, the Company is
able generally to meet its working capital needs during the off-
season. Industry practice is to accumulate funds during the
prime season and use such funds as necessary in the off-season.
The Company has arranged a $150,000 line of credit to ensure
funds are available, if necessary, in the off-season.
COMPETITION
The Company is in competition with nine other RV parks located
within a five-mile radius. Since its property is the only
property located adjacent to the beach, it has a competitive
edge. The Company is recognized as a recreational vehicle resort
rather than a park because of its upgraded facilities and
amenities which include 16 Channels of Satellite TV, a heated
pool, a miniature golf course and a recreational program. The
Resort is noted for its ability to provide full service which
includes RV Storage and RV Repair and Service. In Fiscal Year
1995, the Resort was recognized by "Trailer Life Magazine" as one
of only five premiere family parks in the United States, and
Pismo Coast Village, Inc., was the only one listed west of the
Mississippi River. In Fiscal Year 1996, Pismo Coast Village,
Inc., was awarded the designation of RV Park of the Year 1995 by
the National Association of RV Parks and Campgrounds (ARVC) which
has a membership of over 3,000 properties. These factors allow
the Resort to price its site rental fees well above most of its
competition based on perceived value received.
Competition for the tourist market is keen between the cities on
the Central Coast of California. Resort management and staff are
involved with the City of Pismo Beach, Chamber of Commerce,
Conference and Visitors Bureau and Business Improvement Group and
are major sponsors in cooperative events and advertising. The
Resort continues to direct market off season discounts using its
reservations' database to enhance repeat business. The marketing
program has been expanded targeting groups and clubs by providing
entertainment and catering services through the restaurant. The
Company's marketing plan was funded by $50,583 for Fiscal Year
1996 which was developed out of operating revenues. The major
source of the Company's business is repeat business, which has
been developed by attention to good customer service.
ENVIRONMENTAL REGULATION
The Company is affected by federal, state and local antipollution
laws and regulations. Due to the nature of its business
operations (camping, RV storage and small retail store sales) the
discharge of materials into the environment is not considered to
be of a significant concern and the EPA has not designated the
Company as a potentially responsible party for clean up of
hazardous waste.
<PAGE> 4/40
The main property of the Resort is located within the boundaries
of those lands under the review and purview of the Coastal
Commission of the State of California and the City of Pismo
Beach. The water and sewer systems are serviced by the City of
Pismo Beach. The Company was subject to state and federal
regulations regarding the reconstruction of an outflow structure
that empties into Pismo Creek at the north boundary of the
Resort. Because the Resort is within the wetlands area, the
California Coastal Commission required permits for repair and
construction to be reviewed by the following agencies: City of
Pismo Beach, State Lands Commission, Regional Water Quality Board
State of California, California Department of Fish and Game,
State Department of Parks and Recreation and the Army Corps of
Engineers. The requirement for these permits involved the
diversion of capital from operations, but did not increase cost
of debt financing.
EMPLOYEES
The Company generally employs 35 to 45 persons year round, 22 of
whom are part-time employees. This complement is increased by
approximately eight during the summer season. The Company
considers eight to ten of the employees to be career employees,
the remainder are entry level and part-time workers. The General
Manager works under contract, all other employees are "At Will"
employees with no guarantee of employment. The following chart
depicts the number of employees by area of organization:
Department Full Time Part Time Seasonal
Corporate Office 4 1
Accounting Office 3
Reservations 4 4 2
Maintenance 8 1
RV Operation 4 1
Store 1 4 2
Recreation 3 4
Total 24 14 8
ADDITIONAL INFORMATION
The Company's business and plan of operation for the fiscal year
starting October 1, 1995, required revision as a result of the
flood damage sustained by a storm water outflow drainage
structure on March 10, 1995. The revised plan considered the
continued requirement to fund the rebuilding of the damaged
outflow structure and expenditures for only those capital
projects considered necessary to insure the Company maintains its
resort-like facilities. The Company estimated the cost to repair
the outfall structure would be approximately $350,000 - $400,000.
In addition, the other proposed capital expenditures would be
approximately $127,000. The proposed projects included the
renovation of 48 sites, minor renovation of the three restroom
complexes, installation of a playground, and the additional
upgrade of the administration information computer system.
<PAGE> 5/40
Capital expenditures in Fiscal Year 1996 included completion of
the repair of the storm water outfall structure at a cost of
$422,719, and $96,760 in additional expenditures for renovation
of 48 sites, renovation of three restroom complexes, upgrade of
administration information computer system, installation of a
playground area, renovation of the restaurant kitchen, and
purchase of a pressure washer, street sweeper, maintenance golf
cart, and clubhouse furniture.
Beginning October 1, 1994, site rental rates at the Resort were
increased to range from $22 - $26 per day during the off season
and $32 - $36 per day during prime time. Rates were not
increased for Fiscal Year 1995-96 and an increase in rates is not
being considered for Fiscal Year 1996-97. It is considered the
current rates will continue to market site usage at its highest
value and a rate increase would possibly affect the Company's
ability to capture an optimum market share.
ITEM 2 DESCRIPTION OF PROPERTIES
The Company's principal asset consists of the Resort which is
located at 165 South Dolliver Street in Pismo Beach, California.
The Resort is built on a 26-acre site and includes 400 campsites
with full hookups and nearby restrooms with showers and common
facilities, such as a restaurant, video arcade, recreation hall,
general store, swimming pool, laundromat, and three playgrounds.
In 1980 the Company purchased a 2.2 acre parcel of real property
located at 2050 22nd Street, Oceano, California, at a price of
$66,564. The property is being used by the Company as a storage
facility for recreational vehicles. The storage capacity of this
lot is approximately 114 units.
In 1981 the Company exercised an option and purchased a 3.5 acre
parcel located at 300 South Dolliver Street, Pismo Beach,
California, at a price of $300,000. The property, which
previously had been leased by the Company, is used primarily as a
recreational vehicle storage yard. The storage capacity of this
lot is approximately 223 units.
<PAGE> 6/40
In 1988 the Company purchased approximately .8 acres of property
at 180 South Dolliver Street, Pismo Beach, California, across the
street from the main property, consisting of a large building
with a storefront and one large maintenance bay in the rear.
Also, on the property is a smaller garage type building with
three parking stalls. The Company enlarged its recreational
vehicle repair operation, added RV storage for approximately
eleven units and developed the storefront into an RV parts store.
The property was purchased for $345,000, of which $300,000 was
financed.
There is no deferred maintenance on any of the Resort's
facilities. The Company's facilities are in good condition and
adequate to meet the needs of the stockholder users as well as
the public users. The Company continues to develop sufficient
revenue from general public sites sales to support a continued
positive maintenance program and to meet the demands of
shareholders use of free sites. For the Fiscal Year ending
September 30, 1996, paid site occupancy was 39.7% compared to
45.1% in Fiscal Year 1995.
The Resort, RV Repair Shop and Parts Store and two storage
facilities constitute substantially all the Company's property,
and are owned in fee. Two storage lots and beach access used by
the shareholders and general public visitors are leased by the
Company pursuant to the herein below described leases.
1. TRAILER STORAGE YARDS. In 1986 the Company leased a parcel
of land 100 feet wide by 1,600 feet long from the Southern
Pacific Railroad Corp. The property is being used by the Company
as a storage facility for recreational vehicles. Capital
improvements in the amount of $40,000 were made to this property,
which provides storage for approximately 183 units. The property
was leased for $950 per month the first year, $1,400 per month
for the second year, with continuing years tied to the "CPI"
Index, or Fair Market Value of the property according to the
lease agreement. During Fiscal Year 1996, lease payments were
made in the amount of $34,020, Fiscal Year 1997 lease payments
will be $34,020, and Fiscal Year 1998 lease payments will be
$34,020 plus applicable changes in index or valuation.
In 1991 the Company developed a lease for a five-acre RV storage
lot at the Oceano Airport clear zone as storage for approximately
337 RV's. This lot was developed to replace a 100-unit storage
lot that was closed when the lease was not renewed. The lease on
the new storage lot is for five years with an additional five-year option.
Construction was completed in January 1992 and capital improvements in the
amount of $330,768 were made to this property of which $300,000 was
financed. The Company has notified its landlord that it wishes to exercise
the five-year option and has received favorable response.
<PAGE> 7/40
Lease payments for the first year of control and occupancy area
were $1,500 per month, $2,000 for the second year and continuing
years are tied to the "CPI" index. During Fiscal Year 1996,
lease payments were made in the amount of $25,749, Fiscal Year
1997 lease payments will be $25,923 plus applicable changes in
index, and Fiscal Year 1998 lease payments will be $25,923 plus
index changes.
The Company holds no lease agreement with any affiliated party.
2. AMENDMENT NO. 4 TO CONTRACT, PISMO STATE BEACH LOCATED IN
SAN LUIS OBISPO COUNTY, PISMO COAST VILLAGE, INC., DATED JULY
1976. (Pertaining to the Boardwalk Concession Contract for
construction and maintenance of three boardwalks to the beach for
pedestrians at Pismo State Beach and to provide for continued
access through the sand dunes to the State Beach abutting the
Resort.) This contract is between the Company and the State of
California Department of Parks and has been renewed annually
since June 30, 1984. The contract was originally assigned by the
former owner to Company by an assignment, dated December 1, 1975.
Continued ocean access is granted annually by payment of a
license fee of $400.
The Resort leases out areas to other companies to insure that the
best service and equipment are available for guest use. These
areas are leased from the Company pursuant to the herein below
described leases.
1. RECREATIONAL ARCADE AGREEMENT WITH COIN AMUSEMENTS, INC.
This agreement is dated October 1, 1995, and pursuant to this
agreement the Company granted Coin Amusements, Inc., the
concession to operate various coin-operated game units at the
Resort. The one year term expired on September 30, 1996. This
agreement has been subsequently renewed for a one year term
ending September 30, 1997; continued renewal is expected without
significant impact.
2. WEB SERVICE COMPANY, GOLETA, CA. The five-year lease
expired on July 23, 1992, and was reissued for a five year period
which will expire on July 22, 1997, and grants to Web Service
Company the right to place and service coin-operated laundry
machines at the Resort on a 50-50 basis for all revenues derived
from their use. Continued renewal is expected without
significant impact.
3. RESTAURANT AGREEMENT, LITTLE QUARTERDECK, PISMO BEACH, CA.
In 1993 the Company reorganized its restaurant operations from a
company-managed facility to a leased restaurant operation. The
concessionaire operates the restaurant facilities as an
independent food service operation. A one year lease was entered
into on May 1, 1996, at an annual rent of $4,800. It is expected
this agreement will be renewed and continued without significant
impact. The Company does not expect to resume operation of the
restaurant facilities, but intends to continue leasing to a third
party.
<PAGE> 8/40
ITEM 3 LEGAL PROCEEDINGS
The company or its property is not a party to any pending legal
proceedings.
ITEM 4 SUBMISSION OF MATTERS TO VOTE OF SHAREHOLDERS
Paragraph inapplicable
PART II
ITEM 5 MARKET FOR COMMON STOCK AND RELATED STOCKHOLDER MATTERS
(a.) There is no market for the Company's common stock except
for limited or sporadic transactions; however, Mr. Kenneth L.
McFarlen, a licensed broker/dealer, handles sales of the Company
shares as Central Coast Investments. The last transaction the
Company is aware of occurred on September 30, 1996, at a price of
$9,500 for one share conveyed. This price was used for
computation of aggregate market value of Company stock on the
face page of this Report.
(b.) The approximate number of holders of the Company's common
stock on September 30, 1996 was: 1,534
(c.) The Company has paid no dividends since it was organized in
1975, and although there is no legal restriction impairing the
right of the Company to pay dividends, the Company does not
intend to pay dividends in the foreseeable future. The Company
selects to invest its available working capital to enhance the
facilities at the Resort.
(d.) Mr. McFarlen, the Company's on-site broker, renewed his
agreement which expired on March 31, 1993, to lease 200 square
feet at the Resort, from which he conducts sales activities in
the Company's stock. He has agreed to continue this lease on a
month to month agreement and is current under his lease
agreement. Termination or cancellation may be made by either
Lessor or Lessee by giving the other party ninety (90) days
written notice.
<PAGE> 9/40
ITEM 6 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
CORPORATE OPERATING FORM
Pismo Coast Village, Inc., operates as a 400 space recreational
vehicle resort. The Corporation includes additional business
operations to provide its users with a full range of services
expected of a recreational resort. These services include a
restaurant, store, video arcade, laundromat, recreational vehicle
repair, parts shop and an RV storage operation.
The Corporation is authorized to issue 1,800 shares, of one
class, all with equal voting rights and all being without par
value. Transfers of shares are restricted by Company bylaws.
One such restriction is that transferees must acquire shares with
intent to hold the same for the purpose of enjoying camping
rights and other benefits to which a stockholder is entitled.
Each share of stock is intended to provide the stockholder with
the opportunity for 45 days of free site use per year. However,
if the Corporation is unable to generate sufficient funds from
the public, the Company may be required to charge shareholders
for services.
Management is charged with the task of developing sufficient
funds to operate the Resort through site sales to general public
guests, by allocating a minimum of 175 sites to general public
use and allocating a maximum of 225 sites for stockholder free
use. The other service centers are expected to generate
sufficient revenue to support themselves and/or produce a profit.
CURRENT OPERATING PLANS
Fiscal Year 1996 was to be the fifth year of a five-year plan to
revitalize its service centers and upgrade the facilities of the
Resort. However, due to the cost of replacing the storm water
outfall structure, which was damaged March 10, 1995, the fourth
and fifth years of the plan have been revised. In Fiscal Year
1995 and 1996, the Company limited expenditures to projects
required for operations, safety and to maintain the resort-like
facilities. This action was taken to allow the Company to
develop larger reserves required to fund construction of a storm
water outfall structure. The previous five-year plan, which was
in its fourth year, will be extended into future years. The
Company has completed the renovation of the 48 sites on the south
side of the Resort and plans to complete an additional 123 sites
on the north side during Fiscal Year 1997. In addition to this
major project, the Company plans to: upgrade the streets with
petromat and slurry seal, upgrade/refurbish the maintenance yard
by resurfacing the lot and building a garage building, rebuild a
restroom complex, and build an addition onto the accounting
office. Further, the Company plans to purchase a trash
compactor, RV tow vehicle, gas driven utility cart, and upgrade
the Reservations' software system. The Company estimates these
plans will cost approximately $530,000 and can be funded from
cash from operations.
<PAGE> 10/40
FINANCIAL CONDITION
The business of the Company is seasonal and is concentrated on
prime days of the year which are defined as follows: Washington's
birthday, Easter week, Memorial Day weekend, summer vacation
months, Labor Day, Thanksgiving weekend, and Christmas vacation.
There are no known trends which affect business or affect
revenue.
During the fiscal year ended September 30, 1996, there were
several events which impacted the reporting period's profits
which were of a short term duration, and were either non-
repetitive or corrected by remedial actions in the operations
of the Company.
The one major impact on the financial condition of the Company
was the reconstruction of the storm water drainage outfall caused
by storm damage suffered March 10, 1995. The $422,719 cost of
this project required the review and modification to the
Company's business and operational plans during the fiscal year
ending 1996. This impact included reduction of proposed capital
expenditures, such as deferring site enhancement on the north
side of the Resort and deferring the rebuilding of a restroom
complex. The Company was able to meet the required funding,
however, a $150,000 Line of Credit was established to insure
funds are available during off season periods.
The Company plans to continue its aggressive policy to reduce its
long term debt and to adopt conservative budgets with managed
capital outlays. In September 1993, a note for 180 South
Dolliver Street and another for improvements at an Oceano storage
lot were refinanced, and the new note was for $461,410; the
current balance is $211,343, interest variable (currently 10.5%).
The Board of Directors has directed management to pay an
additional $5,000 with each monthly principal payment made to
this note. It is expected additional payments toward the
principal will continue and this will reduce interest expense and
the requirement for financing from outside sources.
The Company is current on its payments on the installment note
payable, at 8% interest with a principal due of $12,384, secured
by a deed of trust on a Company storage lot at 2050 22nd Street,
Oceano, California.
The combined principal balance due on the two notes which remain
outstanding as of September 30, 1996, was $223,727. The Company
has arranged a $150,000 line of credit that has not been drawn on
to date. The Company has no other liabilities to creditors other
than current accounts payable arising from its normal day-to-day
operations and advance Resort rental reservation deposits, none
of which are in arrears.
The Board of Directors continues its previously established
policy by adopting a stringent, conservative budget for Fiscal
Year 1997, which projects a positive cash flow of approximately
$385,335 from operations. While the Company projects a positive
cash flow, this cannot be assured for Fiscal Year 1997. Capital
expenditures planned for 1997 include the continued enhancement
of 123 RV sites with granite base and utility upgrades,
<PAGE> 11/40
rebuilding of a restroom, purchase of a trailer moving vehicle,
upgrading of the computer system and continuing the enhancement
of the maintenance area, equipment and buildings. These
investments are projected to be approximately $530,000, most of
which can be deferred, if necessary. These proposed capital
improvements will be funded from cash from operations, from
existing working capital and, if necessary, from a line of credit
obtained by the Company in the event projected cash is not
developed. Thus, budgeted cash flow for the year is expected to
be within the Company's capabilities based on its present working
capital position.
LIQUIDITY
The Company's policy is to use its ability to generate operating
cash flow to meet its expected future needs for internal growth.
The Company has continued to maintain sufficient cash so as to
not require the use of a short term line of credit during the
off-season period, and the Company expects to be able to do so
(although no assurance of continued cash flow can be given.).
Net cash provided by operating activities, including purchase of
a certificate of deposit which existed in 1995 and was
discontinued in 1996, totaled $577,120 in 1996, compared to
$427,831 in 1995 and $316,912 in 1994. Cash on hand and
Certificates of Deposits for period in 1996 decreased over the
period ended 1995 by $11,830, and increased over the period ended
1994 by $115,166. These fluctuations are a result of rebuilding
the storm water outfall structure, marketing a reduced discount
rate, pricing concepts and the added revenues from RV Storage
space. The fluctuation of cash position in Fiscal Years 1996,
1995, and 1994 are a result of deferring selected capital
projects. The capital projects that were deferred will not
detrimentally affect current business and were moved to the next
two out years. Future capital expenditures are expected to be
funded through normal operating cash flows.
The major capital expenditures during 1996 consisted of $502,514
to rebuild the storm water outfall structure due to storm damage,
renovation of restaurant kitchen, site enhancements, playground
equipment, computer software, awnings, street sweeper,
maintenance cart, and clubhouse furniture. Major capital
expenditures during 1995 consisted of $195,043 for site
enhancements, installation of night/safety lights, road repair,
painting of buildings, computer hardware and clubhouse furniture.
In 1994, cash investments of $166,650 included site enhancements
and purchase of a trailer moving vehicle. Site enhancements have
involved installation of curbing, landscaping, road improvements,
sidewalks and crushed granite as a parking base. These site
improvements have assisted management in raising the average paid
rate from $23.61 in 1994, to an average of $27.97 in 1995 and an
average of $27.78 in 1996.
<PAGE> 12/40
The Company has continued to maintain sufficient cash from
operations to not require the addition of long term debt during
1996 or 1995. With the possibility of requiring additional funds
for planned capital improvements and winter season, the Company
has taken steps to establish a $150,000 Line of Credit to insure
funds will be available if required.
Fiscal Year 1996's current ratio (current assets to current
liabilities) of 1.8 decreased from Fiscal Year 1995's current
ratio of 2.2. The decrease in current ratio is the result of
$502,705 in capital expenditures, and an increased tax liability
at year end.
Working Capital decreased to $289,613 at the end of Fiscal Year
1996 compared with $386,438 at year end Fiscal Year 1995, and
$293,214 Fiscal Year 1994. These fluctuations are a result of
planned capital improvements, development of cash reserves and
deferment of capital projects that have not detrimentally
affected current operations and no required maintenance has been
deferred.
CAPITAL RESOURCES AND PLANNED EXPENDITURES
The Company plans capital expenditures of $530,000 in Fiscal Year
1997 to renovate 123 camping sites, utility upgrades, restroom
reconstruction, purchase of a trailer moving vehicle, upgrading
of the computer system and continuing the enhancement of the
maintenance area, equipment and buildings. Funding for these
projects is expected to be by revenue generated from the normal
course of business and are expected to increase the Resort's
value to its stockholders and the general public.
<PAGE> 13/40
(d) RESULTS OF OPERATIONS
(1) YEAR TO YEAR COMPARISON
INCOME: Increased over the prior fiscal year ended September 30,
1995, by $164,016, or 6.8%, and increased from fiscal year ended
September 30, 1994, by $240,037, or 10.2%.
INCOME BY SEGMENT
1996 1995 1994
OCCUPANCY
% of Stockholder Site Use 20.8% 20.2% 21.3%
% of Site Rental 42.1% 39.8% 45.1%
% of Storage Rental 94.0% 95.4% 92.9%
RESORT OPERATIONS
Site Rental $1,710,716 $1,621,027 $1,553,514
Storage Operations $319,280 $294,400 $276,959
Support Operations $109,180 $89,336 $88,546
Total $2,139,176 $2,004,763 $1,919,019
RETAIL OPERATIONS
Store $308,293 $291,616 $302,718
RV Repair/Parts store $137,583 $124,657 $123,278
Total $445,876 $416,273 $425,996
TOTAL INCOME $2,585,052 $2,421,036 $2,345,015
<PAGE> 14/40
Increases in Resort Operations income can be directly attributed
to a 5.9% increase in site rental occupancy and an increase in
fees charged to place stored vehicles on site. In addition,
increases can be attributed to a change in marketing strategies;
in Fiscal Year 1994 midweek rates were discounted 50% for the
period November l, 1993, through June 15, 1994. However, during
Fiscal Year 1996 and 1995 midweek rates were discounted only 25%
which in turn developed increased revenues. Elimination of
special promotional pricing and additional lot space rentals for
recreational vehicle storage also significantly contributed to
increased revenues. Storage revenue has increased each year
since the Company established a new storage lot and increased
storage capacity by 300 units. The available recreational
vehicle storage space is approximately 94% full.
Retail operations increased $29,603, or 7.1%, as compared to
Fiscal Year 1995. The RV Repair and Parts operation's growth is
directly related to the growth of the storage operation and the
increase in General Store revenues are a direct result of a 5.1%
increase in total occupancy during the current year compared to
Fiscal Year 1995. Retail operations reflect an increase in
income of $19,880, or 4.7%, above Fiscal Year 1994. The increase
in income in retail operations can be attributed to the continued
increase of revenues in the RV Repair and Parts Operations.
The restaurant operation is no longer a Company revenue center.
It was closed as a Company operation in October of 1992 and is
currently being operated as a leased facility. Currently, the
Company expects to continue the leasing out of this facility.
OPERATING EXPENSES: Decreased $8,137, or 0.5%, in the year ending
September 30, 1996, over the year ended September 30, 1995, and
increased $14,860, or 0.9%, over the year ended September 30,
1994. Decreases from Fiscal Year 1995 to Fiscal Year 1996 relate
directly to expenses caused by a flood condition which occurred
on March 10, 1995. The increase of $14,860, or 0.9%, between
Fiscal Year 1996 and 1994 is considered to be within
expectations.
INTEREST EXPENSE: Decreased during the year ended September 30,
1996, from the year ended September 30, 1995, by $8,993, or
24.2%, as a result of increased principal payments, prepayment of
principal, and reduced interest rates. Interest decreased by
$10,924, or 27.9%, from the year ending September 30, 1994, as a
result of increased principal payments, a reduced rate of
interest, and retirement of debt on an installment note payable.
INCOME BEFORE PROVISION FOR TAXES: Indicated a profit of
$279,576 for the year ended September 30, 1996, compared to a
profit of $146,287 for the year ended September 30, 1995,
compared to a profit of $98,143 for the year ended September 30,
1994. These profits are reflective of the Company's current
pricing policies, and continuing efforts to maximize Resort
services and increase capital expenditures.
<PAGE> 15/40
Inflation has not had a significant impact on our profit
position. Company has increased rates which have more than
compensated for the rate of inflation.
ITEM 7 FINANCIAL STATEMENTS
<PAGE> 16/40
PISMO COAST VILLAGE, INC.
TABLE OF CONTENTS
YEARS ENDED SEPTEMBER 30, 1996, 1995 AND 1994
PAGE
Independent Auditors' Report 3
Balance Sheets September 30, 1996 and 1995 4
Statements of Operations and Changes in Retained Earnings 5
(Deficit) for the Years Ended September 30, 1996, 1995 and 1994
Statements of Cash Flows for the Years
Ended September 30, 1996, 1995 and 1994 6
Notes to Financial Statements 7-13
<PAGE> 17/40
INDEPENDENT AUDITORS' REPORT
Board of Directors
Pismo Coast Village, Inc.
Pismo Beach, California 93449
We have audited the accompanying balance sheets of Pismo Coast
Village,Inc. as of September 30, 1996 and 1995, and the related
statements ofoperations and changes in retained earnings (deficit)
and cash flows foreach of the three years then ended September 30,
1996. These financialstatements are the responsibility of the
Company's management. Our responsibility is to express an opinion
on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audits to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Pismo
Coast Village, Inc. as of September 30, 1996 and 1995, and the results
of its operations and its cash flows for each of the three years then
ended September 30, 1996, in conformity with generally accepted
accounting principles.
Glenn, Burdette, Phillips & Bryson
Certified Public Accountants
A Professional Corporation
October 17, 1996
<PAGE> 18/40
PISMO COAST VILLAGE, INC.
BALANCE SHEETS
SEPTEMBER 30, 1996 AND 1995
1996 1995
ASSETS
Current Assets
Cash and cash equivalents $517,236 $529,066
Accounts receivable 6,122 10,960
Inventory 59,092 65,826
Current deferred taxes 25,000 22,624
Prepaid expenses 60,864 74,079
------- -------
Total current assets 668,314 702,555
Pismo Coast Village Recreational
Vehicle Resort and Related Assets -
Net of accumulated depreciation 5,643,793 5,423,666
Other Assets 12,979 8,255
--------- ---------
Total Assets $6,325,086 $6,134,476
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable $37,244 $37,796
Salaries payable 1,633 9,200
Vacation payable 33,482 28,456
Other accrued expenses 29,879 32,155
Rental deposits 197,968 179,300
Income tax payable 45,000 6,498
Current portion of long-term debt 33,495 22,712
------- -------
Total current liabilities 378,701 316,117
Long-Term Liabilities
Long-term deferred taxes 66,000 23,331
Long-term debt 190,232 287,451
------- -------
Total liabilities 634,933 626,899
Stockholders' Equity
Common stock - no par value, issued
and outstanding 1,800 shares 5,647,708 5,647,708
Retained earnings (deficit) 42,445 (140,131)
--------- ---------
Total stockholders' equity 5,690,153 5,507,577
Total Liabilities and Stockholders' --------- ---------
Equity $6,325,086 $6,134,476
========= =========
The accompanying notes are an integral part of these financial
statements.
<PAGE> 19/40
PISMO COAST VILLAGE, INC.
STATEMENTS OF OPERATIONS AND RETAINED EARNINGS (DEFICIT)
YEARS ENDED SEPTEMBER 30, 1996, 1995 AND 1994
1996 1995 1994
Income
Resort operations $2,139,176 $2,004,763 $1,919,019
Retail operations 445,876 416,273 425,996
--------- --------- ---------
Total income 2,585,052 2,421,036 2,345,015
Costs and Expenses
Operating expenses 1,739,856 1,747,993 1,724,996
Cost of goods sold 255,060 235,817 242,584
Depreciation 281,062 252,447 238,868
Amortization 1,325 1,326 1,327
Interest 28,173 37,166 39,097
--------- --------- ---------
Total costs and expenses 2,305,476 2,274,749 2,246,872
--------- --------- ---------
Income Before Provision for
Taxes on Income 279,576 146,287 98,143
Provision for taxes on income
97,000 40,427 29,316
--------- --------- ---------
Net Income 182,576 105,860 68,827
Retained Earnings (Deficit)
Beginning of Year (140,131) (245,991) (314,818)
--------- --------- ---------
End of Year $42,445 $(140,131) $(245,991)
========= ========= =========
Earnings Per Share $101.43 $58.81 $38.24
========= ========= =========
The accompanying notes are an integral part of these financial
statements.
<PAGE> 20/40
PISMO COAST VILLAGE, INC.
STATEMENTS OF CASH FLOWS
YEARS ENDED SEPTEMBER 30, 1996, 1995 AND 1994
1996 1995 1994
Cash Flows From Operating Activities
Net income $182,576 $105,860 $68,827
------- ------- -------
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation 281,062 252,447 238,868
Amortization 1,325 1,326 1,327
Proceeds (purchases) of
certificates of deposit 50,000 (50,000)
(Increase) decrease in accounts
receivable and prepaid expenses 18,053 15,857 (12,869)
(Increase) decrease in inventory 6,734 7,157 (7,895)
(Increase) decrease in deferred
income tax (2,376) 5,358 24,341
(Increase) decrease in other assets (4,724) 1,800
Increase (decrease) in accounts payable (552) 15,528 (30,645)
Increase (decrease) in salaries payable (7,567) (16,985) 6,477
Increase in vacation payable 5,026 879 3,646
Increase (decrease) in other
other accrued expenses (2,276) 1,433 1,259
Increase in income taxes payable 38,502 6,498 (4,915)
Increase in deferred income tax 42,669 23,331
Increase in rental deposits 18,668 7,342 28,491
------- ------- -------
Total adjustments 394,544 371,971 198,085
------- ------- -------
Net cash provided by operating
activities 577,120 477,831 266,912
------- ------- -------
Cash Flows From Investing Activities
Capital expenditures (502,514) (212,540) (166,650)
------- ------- -------
Net cash used in investing activities (502,514) (212,540) (166,650)
------- ------- -------
Cash Flows From Financing Activities
Retirement of debt (86,436) (88,295) (107,452)
------- ------- -------
Net cash used in financing activities (86,436) (88,295) (107,452)
------- ------- -------
Net increase (decrease) in cash and
cash equivalents (11,830) 176,996 (7,190)
Cash and Cash Equivalents
at Beginning of Year 529,066 352,070 359,260
------- ------- -------
Cash and Cash Equivalents
at End of Year $517,236 $529,066 $352,070
======= ======= =======
Schedule of Payments of Interest and
Taxes Payments for interest $28,173 $37,166 $39,097
Payments for income tax $18,318 $4,880 $9,938
The accompanying notes are an integral part of these financial
statements.
<PAGE> 21/40
PISMO COAST VILLAGE, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996, 1995 AND 1994
Note 1 - Summary of Significant Accounting Policies
Nature of Business
Pismo Coast Village, Inc. (Company) is a recreational vehicle camping
resort. Its business is seasonal in nature with the fourth quarter, the
summer, being its busiest and most profitable.
Inventory
Inventory has been valued at the lower of cost or market on a first-
in, first-out basis.
Depreciation and Amortization
Depreciation of property and equipment is computed using an acceler-
ated method based on the cost of the assets, less allowance for
salvage value, where appropriate. Depreciation rates are based upon
the following estimated useful lives:
Building and park improvements 5 to 40 years
Furniture, fixtures, equipment and
leasehold improvements 5 to 31.5 years
Transportation equipment 5 to 10 years
Loan fees of $9,292 net of accumulated amortization of $3,978 and
$2,653 at September 30, 1996 and 1995, respectively, are included
with other assets. Amortization is computed using the straight-line
method over seven years. The balance of other assets at September 30,
1996 and 1995, represents deposits on hand of $7,665 and $1,616,
respectively.
Investment Tax Credits
Investment tax credits are accounted for by the flow-through method.
Earnings Per Share
The earnings per share is based on the 1,800 shares issued and
outstanding.
Cash and Cash Equivalents
For purposes of the statements of cash flows, the Corporation considers
all highly liquid investments including certificates of deposit with a
maturity of three months or less when purchased, to be cash equivalents.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect certain reported amounts and disclosures.
Accordingly, actual results could differ from those estimates.
<PAGE> 22/40
PISMO COAST VILLAGE, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996, 1995 AND 1994
PAGE 2
Note 2 - Pismo Coast Village Recreational Vehicle Resort and Related Assets
At September 30, 1996 and 1995, property and equipment, which are
recorded at cost, included the following:
1996 1995
Land $2,680,850 $2,680,850
Building and park improvements 5,521,908 5,020,613
Furniture, fixtures,
equipment and leasehold
improvements 1,205,415 1,197,457
Transportation equipment 148,152 139,227
Construction in progress 147 17,136
--------- ---------
9,556,472 9,055,283
Less accumulated
depreciation 3,912,679 3,631,617
--------- ---------
$5,643,793 $5,423,666
========= =========
Major additions in the year ended September 30, 1996, included, creek
restoration, granite site bases, and safety lighting projects.
Note 3 - Long-Term Debt
Long-term debt at September 30, 1996 and 1995, is summarized as
follows:
1996 1995
8% Installment note payable, due in monthly
installments of $125 through April 13,
2010, secured by deed of trust on the
storage lot at 2050 22nd Street, Oceano. $ 12,384 $ 12,872
10.5% Installment note payable, due in monthly
installments of $4,426 through August 1, 2000,
unpaid balance due in full September 1, 2000.
Interest is variable, secured by deed of trust on
300 South Dolliver and 180 South Dolliver,
Pismo Beach. 211,343 297,291
------- -------
223,727 310,163
Less current portion of long-term debt 33,495 22,712
------- -------
$190,232 $287,451
======= =======
<PAGE> 23/40
PISMO COAST VILLAGE, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996, 1995 AND 1994
PAGE 3
Note 3 - Long-Term Debt (Continued)
Maturities of long-term debt are as follows:
Year Ended September 30, Amount
1997 $33,495
1998 36,633
1999 40,656
2000 103,141
2001 727
Thereafter 9,075
-------
Total $223,727
Total interest cost incurred was $28,173, $37,166 and $39,097 for
the years ended September 30, 1996, 1995 and 1994.
Note 4 - Line of Credit
The Company has a revolving line of credit for $150,000. The
interest rate is variable at two percent over prime, with an initial
rate of 10.25 percent expiring December 28, 1996. The purpose of
the loan is to augment operating cash needs in off season months.
There were no outstanding amounts as of September 30, 1996.
Note 5 - Common Stock
Each share of stock is intended to provide the shareholder with a
minimum free use of the park for 45 days per year. If the Company
is unable to generate sufficient funds from the public, the Company
may be required to charge shareholders for services.
A shareholder is entitled to a pro rata share of any dividends as
well as a pro rata share of the assets of the Company in the event
of its liquidation or sale. The shares are personal property and do
not constitute an interest in real property. The ownership of a
share does not entitle the owner to any interest in any pabticular
site or camping spot.
Note 6 - Carryforwards Relating to Federal Income Taxes
The Company has the following tax credits available to offset future
federal tax liabilities:
Approximate investment tax credits expiring as follows:
September 30, 2000 $250
September 30, 2001 356
<PAGE> 24/40
PISMO COAST VILLAGE, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996, 1995 AND 1994
PAGE 4
Note 7 - Income Taxes
Effective October 1, 1992, the Company adopted Statement of Financial
Accounting Standard No. 109, "Accounting for Income Taxes" (SFAS 109).
SFAS 109 requires, among other things, a change from the deferred to
the asset-liability method of computing deferred income taxes. This
is considered a change in accounting principle and the net effect of
the change resulted in a one time benefit of $83,402.
The provision for income taxes consists of the following components:
1996 1995 1994
Current:
Federal $62,000 $33,713 $11,615
State 25,000 11,738 6,186
------ ------ ------
87,000 45,451 17,801
Deferred:
Federal 38,000 26,901 16,793
State 2,000 1,788 7,548
------ ------ ------
40,000 28,689 24,341
Tax benefit of net
operating loss
carryforward:
Federal (30,000) (33,713) (11,615)
State (1,211)
------ ------ ------
$97,000 $40,427 $29,316
The deferred tax assets (liabilities) are comprised of the following:
1996 1995
Current Long-Term Current Long-Term
Deferred tax assets:
Federal $23,000 $ $20,533 $
State 2,000 2,091
Deferred tax liabilities:
Federal (46,000) (4,718)
State (20,000) (18,613)
------- ------- ------- -------
$25,000 $(66,000) $22,624 $(23,331)
<PAGE> 25/40
PISMO COAST VILLAGE, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996, 1995 AND 1994
PAGE 5
Note 7 - Income Taxes (Continued)
The above deferred tax assets (liabilities) consist of the following
temporary differences:
1996 1995
Depreciation $(66,000) $(48,806)
------ ------
Total gross deferred tax liabilities (66,000) (48,806)
Net operating loss carryforward 23,853
Federal tax credits 3,000 11,622
Vacation accrual 10,000 6,587
Miscellaneous 12,000 6,037
------ ------
Total gross deferred tax assets 25,000 48,099
------ ------
$(41,000) $ (707)
The effective income tax rate varies from the statutory federal income
tax rate as follows:
1996 1995 1994
Statutory federal income tax rate 34.0 % 34.0% 34.0%
Increase (decreases):
State income taxes, net of
federal benefit 6.3 6.2 8.5
Effect of graduated tax rates (5.1) (12.8) (12.6)
Miscellaneous (.6) .2 .1
---- ---- ----
Effective Income Tax Rate 34.6 % 27.6 % 30.0 %
<PAGE> 26/40
PISMO COAST VILLAGE, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996, 1995 AND 1994
PAGE 6
Note 8 - Operating Expenses
Operating expenses for the years ended September 30, 1996, 1995 and
1994,consisted of the following:
1996 1995 1994
Direct labor $450,450 $446,199 $475,321
Administrative salaries 225,569 199,321 190,388
Contract labor 816 13,707 8,117
Insurance 148,302 179,259 180,260
Payroll tax expense 64,977 64,047 64,703
Employee travel and training 15,778 15,497 15,217
Property taxes 39,673 27,498 27,168
Taxes and licenses 4,367 4,725 4,916
Corporation expense 46,257 55,344 45,834
Advertising and promotion 50,583 31,219 34,402
Telephone 26,228 27,689 31,517
Security 62,295 62,950 63,581
Office supplies and expense 38,943 37,565 35,847
Custodial supplies 8,889 7,314 5,620
Recreational supplies 4,211 3,669 4,823
Professional services 24,413 33,142 21,477
Retail operating supplies 3,102 3,037 3,681
Repairs and maintenance 63,487 54,054 50,988
Contract services 125,713 123,128 120,561
Equipment lease 1,850 1,001 3,051
Utilities 194,691 193,380 204,729
Auto and truck expense 28,756 29,020 31,335
Rent - storage lots 59,769 55,766 52,815
Bad debts 1,277 238 170
Service charges 36,969 36,813 33,288
Storm damages 29,713
Uniforms 5,904 5,882 9,323
Miscellaneous 6,587 6,816 5,864
--------- --------- ---------
Total Operating Expenses $1,739,856 $1,747,993 $1,724,996
<PAGE> 27/40
PISMO COAST VILLAGE, INC.
NOTES TO FINANCIAL STATEMENTS
SEPTEMBER 30, 1996, 1995 AND 1994
PAGE 7
Note 9 - Operating Leases
The Company leases two pieces of property to use as storage lots.
One is leased under a cancelable month-to-month lease. The other
was entered into effective August 1, 1991, for five years with an
option to extend the lease for an additional five years. Monthly
lease payments are currently $2,160 and are increased annually based
on the Consumer Price Index. Future minimum lease payments underthe
second lease are as follows:
Year Ended September 30, Amount
1996 $ 6,480
-----
Total $ 6,480
The current agreement has been extended until December 31, 1996. The
Company has given notice of intent to exercise the option for five
additional years and is awaiting lessor approval.
<PAGE> 28/40
ITEM 8 CHANGES IN AND DISAGREEMENT WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
Inapplicable.
PART III
ITEM 9 DIRECTORS, EXECUTIVE OFFICERS, AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
(a) Except for new appointee Thomas Rourke who replaced Danny R.
Shaffer, the Company's Directors were chosen at the Shareholder's
Annual Meeting on January 20, 1996. The Directors serve for one
year, or until their successors are elected. The names, ages,
background and other information concerning the Directors,
including other offices held by the Directors with the Company,
are set forth below.
(b) The following is a list of the Company's Directors and
Executive Officers setting forth their functions and experience.
There is no familial relationship between the Directors nor
between the Directors and the Officers. There is no
understanding or agreement under which the Directors hold office.
HOWARD ALLARD, Director
Howard Allard, age 71, resides at 5161 Diablo Drive,
Sacramento, California 95842. He has a master's degree in
education administration from California State University,
Sacramento. He was an elementary school principal in the Rio
Linda Union School District for 29 years prior to retirement in
1985. He has been a partner since 1978 in Allard Enterprises
which maintains rental properties, and he has also been a partner
since 1982 in Allard Limousine and in the Horse Shoeing Supplies
Company since 1987. Mr. Allard has served on the Board for 16
years, including three years as President and two years as
Secretary.
EMILY BARTON, Director
Emily Barton is 64 years old. She resides at 4008
Glenbrook Avenue, Bakersfield, California 93306. She holds an
inactive B-1 California Contractor's License and a supplemental
Swimming Pool License C-53. She was active in the building
business for many years. She is still active in the remodeling
and rehabilitation of her properties. She has been in the rental
business for 29 years and is currently active in the rental
business. Her specialty is buying foreclosures. She holds an
inactive life and disability insurance license and is associated
with Cross Town Insurance Co. She is past president of B'nai
B'rith Women Bakersfield Chapter #69. Under her leadership,
B'nai B'rith Women received many community service awards. She
has served on the Board for four years.
<PAGE> 29/40
DONALD BIANCHI, Director
Donald Bianchi is 73 years old. He resides at 3605 Belle
Terrace, Bakersfield, California 93309. He retired from the
U.S. Air Force as a Lieutenant Colonel in 1983 and served as
president of The Retired Officers Association in 1994. He was a
traffic officer, pilot and accident follow-up investigator for
the California Highway Patrol for 31 years until his retirement
in 1978. He served as vice president of the Kern Kiwanis and is
an active member of the Masonic Lodge. He is now a licensed
state investigator in private practice and monitor for California
traffic schools. He has served on the Board for 21 years.
KURT BRITTAIN, Director and Executive Vice President
Kurt Brittain is 66 years old and resides at 518 El Modena
Avenue, Newport Beach, California 92663. After his Marine Corps
service, he was employed for more than 33 years by Orange County,
California, before his retirement in 1986. His background
includes public works, flood control and manager of the county's
harbors, beaches and parks system. He was in charge of three
harbors, seven beaches and over 26 parks, three of which were
camping parks. He has completed extension courses in business
administration, management, recreation and real estate. He has
served on the Board for seven years; including one year as Vice
President - Administration, one year as Vice President -
Secretary, and is currently serving a fourth year as Executive
Vice President.
ALBERT BROWN, Director
Albert Brown is 73 years old. He resides at 22718 Lone
Eagle Road, Apple Valley, California 92308. He was employed at
Hughes Aircraft for 20 years, from 1945 to 1965, T.R.W. Systems
for 3 1/2 years, from 1965 to 1968, and Rohr Industry Inc., for 11
1/2 years, from 1968 until retirement in 1979. He worked his way
up from being an assembler to senior industrial engineer,
reporting directly to the manager of industrial engineering. He
has completed extensive continued education in the field of
industrial engineering at U.S.C. He is an instructor with the
A.A.R.P. 55-Alive Senior Driving Course. He has served on the
Board of Directors for 11 years, including two years as Vice
President - Administration.
HARRY BUCHAKLIAN, Director
Harry Buchaklian is 64 years old. He resides at 1361 E.
Ticonderoga Drive, Fresno California 93720. He has a B.A. degree
from C.S.U.F. in industrial arts, and a secondary level teaching
credential in laboratory electronics and small engine repair.
His career has included employment as assistant manager with
Western Auto Stores, electronics instructor at Fresno Technical
College and technical supervisor for Sears Roebuck. He retired
from Sears Roebuck in 1994. He has served on the Board for 12
accumulative years, including most recently from September 16,
1995, to present.
<PAGE> 30/40
FRANK DRAKE, Director
Frank Drake is 55 years old. He resides at 9511 Birch
Creek Court, Bakersfield, California 93312. Mr. Drake has an
A.A. degree from Bakersfield College, and holds an administration
of justice lifetime vocational teaching credential from U.C.L.A.
Mr. Drake retired after 20 years with the Kern County Sheriffs
Department where he was commander of detective, administration
and jail facilities. Following his retirement from the Sheriff's
Department in 1988, he was employed as a safety consultant with
State Compensation Insurance Fund assisting clients in complying
with OSHA and other safety standards. He retired from this
position in December 1995. Mr. Drake has served on the Board for
one year.
NORMAN GOULD, Director
Norman Gould is 77 years old. He resides at 10597 Road 30,
Madera, California 93637. He has a B.A. in education and an
M.A. in administration. His occupation prior to retirement in
1986 was as the superintendent of schools for Madera County. He
was a member of the board of directors of Kingsview, Inc., from
1968 to 1980 and held the positions of vice chairman and chairman
of the board. He is currently on the board of directors of
Valley Teen Ranch, Inc. Mr. Gould also serves as the president
on the board of directors for Camp Sugar Pine, Inc., a nonprofit
corporation. He has served on the Board for 18 accumulative
years, most recently March 20, 1993, to present, including nine
years as President, one year as Treasurer and two years as
Secretary.
MAURICE GREENBERG, Director
Maurice Greenberg is 77 years old. He resides at 17225
Tennyson Place, Granada Hills, California 91344. He is a
consulting registered civil engineer and geotechnical engineer in
California, and registered professional engineer in nine other
states. He worked 19 years with the Ralph M. Parsons Company,
worldwide engineers and constructors, as vice president and
manager of geotechnical services worldwide. Prior to that he
worked 20 years as soils testing and construction inspection and
geotechnical engineer for the city of Detroit, Michigan, and has
been named a distinguished graduate and member of the Hall of
Fame at Wayne State University where he received his Bachelor's
degree. He retired in 1985 from the Ralph M. Parsons Company.
He has a Master's degree in engineering from the University of
Michigan. He is a life fellow of the American Society of Civil
Engineers, life member of the Society of American Military
Engineers, and life member of National Rifle Association. Mr.
Greenberg has served on the Board for 11 years, including one
year as Executive Vice President.
EDWARD HINDS, JR., Director and Vice President - Secretary
Edward (Dee) Hinds, Jr., age 69, resides at 3416 West
Magill Avenue, Fresno, California 93711. He was employed by
Bank of America serving as a branch officer, vice president,
manager and regional credit administrator for more than 38 years
prior to his retirement in 1988. He has served on the Board for
16 years, and is currently serving a fourth year as Vice
President - Secretary.
<PAGE> 31/40
TERRIS HUGHES, Director
Terris (Terry) Hughes, is 47 years old and resides at 2426
Sunset, Wasco, California 93280. Mr. Hughes holds an A.A. degree
from Bakersfield Junior College in police science. He has been
employed with Cal Resources LLC for 23 years, an oil industry
company recently acquired by Mobil Oil Corporation, and has held
the position of senior training technician for the last 10 years.
His duties include providing safety and operational training to
Cal Resources LLC employees. Mr. Hughes has served on the Board
for one year.
LARRY KELLER, Director
Larry Keller, age 43, resides at 3807 Mesa Grande,
Bakersfield California 93304. Mr. Keller founded and operated
Nooner Food Service from 1979 until 1992, providing on-site food
service of up to 13,000 meals per day at fire camps for the U. S.
Forest Service throughout 11 western states. He also served as
president, vice president and secretary/treasurer of the Western
Forest Fire Catering Association. Since 1992, Mr. Keller has
been self-employed at Presidio Business Center, a commercial real
estate management company he owns and manages. Mr. Keller has
served on the Board for one year.
RONALD NUNLIST, Director and President
Ronald Nunlist, age 59, resides at 1105 Minter Avenue,
Shafter, California 93263. He has been employed in the oil
business for many years and since 1995 has been employed by Cal
Resources LLC, an oil industry company recently acquired by Mobil
Oil Corporation, as an operations foreman. He has served on the
Board for 11 years, and is currently serving his fifth year as
President.
JERALD PETTIBONE, Director, Vice President - Finance, and Chief
Financial Officer
Jerry Pettibone, age 70, resides at 4179 Court Drive,
Santa Cruz, California 95062. He sold and retired from his
company, Pettibone Signs in Santa Cruz, in October 1988. He
started the company in 1960, which operated statewide. Active in
trade associations, he served on the board of directors of the
National Electric Sign Association, and on the board of directors
of the World Sign Association, serving as national president in
1985-1986. He served on the board of directors of the California
Electric Sign Association for 22 years and was recently elected a
director emeritus. Also active in Rotary Club, he is a charter
member and past president of the Capitola/Aptos Club. He has
served Rotary as district governor of district 5170 in 1983-1984.
Mr. Pettibone has been a shareholder since 1979. He has served
on the Board for four years and is currently serving a third term
as Vice President - Finance/Chief Financial Officer.
<PAGE> 32/40
<PAGE>
THOMAS ROURKE, Director
Thomas Rourke is 59 years old. He resides at 899 Stagi
Lane, Los Altos, California 94024. Mr. Rourke graduated from the
University of Massachusetts in 1965 with a B.B.A. degree. He was
vice president of operations at Lynch Communications, Inc., in
Reno, Nevada from 1980-1982, and president of Lynch Circuits,
Inc., in Sunnyvale, California from 1982-1987. He is currently
president and chairman of the board of Startech Electronics,
Inc., a company that produces printed circuit boards and other
electronic equipment, in Mountain View, California, a position he
has held since 1988. Mr. Rourke was appointed by the Board on
July 20, 1996, to fill a vacancy created by the resignation of
Danny Shaffer.
HENRY VALENTIA, Director and Vice President - Administration
Henry Valentia is 71 years old. He resides at 2007
Cardinal Way, Fairfield, California 94533. He is retired from
the U.S. Air Force as a Lieutenant Colonel in 1969. He has a
degree in industrial management and an A.A. in business
administration. Mr. Valentia also retired from Chevron
Corporation as a safety engineer in 1984. From June 1979 to June
1984 he served on the board of directors at Travis Air Force Base
Credit Union on its finance committee. Mr. Valentia has also
served two years as treasurer on the board of directors for
Lawrence Welk Desert Oasis, Palm Springs, California. He has
served on the Board for 10 years, and is currently serving a
second year as Vice President - Administration.
JACK WILLIAMS, Director
Jack Williams is 46 years old. He resides at 7801
Revelstoke Way, Bakersfield California 93309. Mr. Williams
graduated from San Diego State University in 1974 with a B.S. in
accounting. Following that, he has been employed in the field of
accounting in a variety of industries, including agriculture,
construction, heavy equipment sales, and manufacturing. Mr.
Williams established his own C.P.A. practice in 1983, and has
been in practice since that time. He has served on the Board of
Directors for two years.
CHARLES ZAHKA, Director
Charles Zahka, age 70, resides at 6300 Alonzo Avenue,
Encino, California 91316. He retired as vice president of the
Broadway Department Stores in 1990 after 20 years. He presently
serves as a private management consultant. Mr. Zahka is
president of the Stroke Association of Southern California and
vice-chairman of the Better Business Bureau of the Southland. He
has served on the Board for eight years, including one year as
Secretary and one year as President.
DANNY SHAFFER, Former Director
Danny Shaffer is 47 years old and resides at 16620 Johnson
Road, Bakersfield California 93312. Mr. Shaffer been employed
for 18 years as owner and president of Kern Backhoe Service,
Inc., Kern Environmental Service, and KVS Transportation, oil
construction, environmental, and transportation businesses. He
also owns commercial rental properties. Mr. Shaffer was
appointed by the Board on May 20, 1995, to fill a vacancy created
by the death of Director Reva Ramey. Mr. Shaffer served on the
Board until his resignation in March 1996.
<PAGE> 33/40
Other Officers and Key Employees:
BLAINE FORREST, Assistant Corporate Secretary and General Manager
Blaine Forrest, 59 years old, is employed by the Company
as General Manager and serves as Assistant Corporate Secretary.
He resides at 120 4th Street, Templeton, California 93465. He
has a B.S. degree in business management from Pacific Christian
College and an M.P.A. from the University of San Francisco. He
served in the military for 31 years, from 1955 to 1986, with
assignments as administrative officer, facilities manager and
comptroller. He served from 1983 to 1986 as a deputy director of
the California Conservation Corps, a position to which he was
appointed by the then governor of California. His business
affiliations include: Member of board of directors of California
Travel Parks Association for nine years, from 1987 to 1996,
(serving two years as president), a director on the Pismo Beach
Chamber of Commerce since 1991 and currently serving a second
term as president, served as a commissioner on the Pismo Beach
Conference and Visitors Bureau (a position appointed by the mayor
of the city) from 1990 to 1996, and president of the Hospitality
Association of Pismo Beach for three years, 1991, 1992 and 1993.
Mr. Forrest has served in his position with the Company for ten
years.
FURTHER INFORMATION CONCERNING EXECUTIVE OFFICERS AND DIRECTORS
To the knowledge of the Company, none of the officers or
directors have been personally involved in any bankruptcy or
insolvency proceedings. To the knowledge of the Company, none of
the directors or officers have been convicted in any criminal
proceedings (excluding traffic violations and other minor
offenses) or are the subject of a criminal proceeding which is
presently pending, nor have such persons been the subject of any
order, judgment, or decree of any court of competent
jurisdiction, permanently or temporarily enjoining them from
acting as an investment advisor, underwriter, broker or dealer in
securities, or as an affiliated person, director or insurance
company, or from engaging in or continuing in any conduct or
practice in connection with any such activity or in connection
with the purchase or sale of any security, nor were any of such
persons the subject of a federal or state authority barring or
suspending, for more than 60 days, the right of such person to be
engaged in any such activity, which order has not been reversed
or suspended.
ITEM 10 EXECUTIVE COMPENSATION
No Officer or Director was paid over $100,000 during the past
fiscal year.
REMUNERATION OF DIRECTORS
The directors received no cash remuneration for their service.
However, the directors are entitled to mileage reimbursement for
travel to and from meetings upon request. In addition, they are
entitled to use of the Resort for attending meetings and are
provided with food and refreshments in connection with Board
Meetings. The aggregate value of the foregoing during the fiscal
year ended September 30, 1996, was estimated at $14,579.
<PAGE> 34/40
OPTIONS, WARRANTS OR RIGHTS
The Company has no outstanding options, warrants or rights to
purchase any of its securities.
INDEBTEDNESS OF MANAGEMENT
No member of management was indebted to the Company during its
last fiscal year.
ITEM 11 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
MANAGEMENT
(a) No person owns beneficially of record more than 5% of the
Company's securities.
SECURITY OWNERSHIP OF MANAGEMENT
(b) The following sets forth the securities beneficially owned,
directly, by all directors and officers as a group as of
September 30, 1996:
Amount of Percent
Board Member Title of Class Ownership of Class
Howard Allard Common Stock 1 Share 0.056%
5161 Diablo Ave
Sacramento CA 95842
Emily Barton Common Stock 2 Shares 0.111%
4008 Glenbrook Ave
Bakersfield CA 93306
Donald Bianchi Common Stock 2 Shares 0.111%
3605 Belle Terrace
Bakersfield CA 93309
Kurt Brittain Common Stock 2 Shares 0.111%
518 El Modena Ave
Newport Beach CA 92663
Albert Brown Common Stock 2 Shares 0.111%
22718 Lone Eagle Rd
Apple Valley CA 92308
Harry Buchaklian Common Stock 1 Share 0.056%
1361 E Ticonderoga Dr
Fresno, CA 93720
<PAGE> 35/40
Amount of Percent
Board Member Title of Class Ownership of Class
Frank Drake Common Stock 1 Share 0.056%
1242 Castaic Ave
Bakersfield CA 93308
Norman Gould Common Stock 1 Share 0.056%
10597 Road 30
Madera CA 93637
Maurice Greenberg Common Stock 1 Share 0.056%
17225 Tennyson Pl
Granada Hills CA 91344
Edward Hinds, Jr. Common Stock 1 Share 0.056%
3416 W Magill Ave
Fresno CA 93711
Terris Hughes Common Stock 1 Share 0.056%
2426 Sunset
Wasco CA 93280
Larry Keller Common Stock 1 Share 0.056%
3807 Mesa Grande
Bakersfield CA 93304
Ronald Nunlist Common Stock 4 Shares 0.222%
1105 Minter Ave
Shafter CA 93263
Jerald Pettibone Common Stock 1 Share 0.056%
4179 Court Dr
Santa Cruz CA 95062
Thomas Rourke Common Stock 2 Shares 0.111%
899 Stagi Ln
Los Altos CA 94024
Henry Valentia Common Stock 3 Shares 0.167%
2007 Cardinal Way
Fairfield CA 94533
<PAGE> 36/40
Amount of Percent
Board Member Title of Class Ownership of Class
Jack Williams Common Stock 1 Share 0.056%
7801 Revelstoke Way
Bakersfield CA 93309
Charles Zahka Common Stock 2 Shares 0.111%
6300 Alonzo Way
Encino CA 91316
All Officers and
Directors as a Group Common Stock 29 Shares 1.611%
All such shares are owned beneficially and of record, there are no
additional shares known to the Company for which the listed
beneficial owner has the right to acquire beneficial ownership as
specified in Rule 13D-3(d)(1) of the Exchange Act.
c) CHANGES IN CONTROL
Not applicable
ITEM 12 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There have been no transactions between the Company and any member
of management, director, officer, any 5% shareholder, promoter or
family member of the foregoing, either during the last two years or
proposed.
PART IV
ITEM 13 EXHIBITS AND REPORTS ON FORM 8-K
(a.) Documents Filed as Part of the Report:
Independent Auditor's Report
Balance Sheets as of September 30, 1996 and 1995
Statements of Operations and Changes in Retained Earnings
(Deficit) for the years ended September 30, 1996, 1995 and 1994
Statements of Cash Flows for the years ended September 30, 1996,
1995 and 1994
<PAGE> 37/40
Notes to Financial Statements
Supporting Schedules:
XIII. Capital Shares as of September 30, 1996 and 1995.
(b.) Reports on Form 8-K - None have been filed during the last
quarter of the period covered by this report.
(c.) Exhibit/Index:
Sequential
Exhibit Number Item Description Page Number
24 Consent of Accountants 24
27 Financial Data Schedule *
* Filed electronically only
<PAGE> 38/40
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Company has duly caused this
report to be signed on its behalf by the undersigned, thereunto
duly authorized.
PISMO COAST VILLAGE, INC.
By: /s/ Ronald Nunlist Date:
November 16,
1996
Ronald Nunlist, President and
Chairman of the Board
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of the Company and in the capacities and on the dates
indicated.
By: /s/ Ronald Nunlist Date:
November 16,
1996
Ronald Nunlist, President and
Chairman of the Board
By: /s/ Kurt Brittain Date:
November 16,
1996
Kurt Brittain, Executive Vice President and Director
By: /s/ Edward Hinds, Jr. Date:
November 16,
1996
Edward Hinds, Jr., Vice President - Secretary and Director
By: /s/ Jerald Pettibone Date:
November 16,
1996
Jerald Pettibone, C. F. O., V. P. - Finance and Director
By: /s/ Henry Valentia Date:
November 16,
1996
Henry Valentia, Vice President - Administration and
Director
By: /s/ Howard Allard Date:
November 16,
1996
Howard Allard, Director
By: /s/ Emily Barton Date:
November 16,
1996
Emily Barton, Director
By: /s/ Donald Bianchi Date:
November 16,
1996
Donald J. Bianchi, Director
By: /s/ Albert Brown Date:
November 16,
1996
Albert Brown, Director
<PAGE> 39/40
By: /s/ Harry Buchaklian Date:
November 16,
1996
Harry Buchaklian, Director
By: /s/ Frank Drake Date:
November 16,
1996
Frank Drake, Director
By: /s/ Norman Gould Date:
November 16,
1996
Norm Gould, Director
By: /s/ Maurice Greenberg Date:
November 16,
1996
Maurice Greenberg, Director
By: /s/ Terris Hughes Date:
November 16,
1996
Terris Hughes, Director
By: /s/ Larry Keller Date:
November 16,
1996
Larry Keller, Director
By: /s/ Thomas Rourke Date:
November 16,
1996
Thomas Rourke, Director
By: /s/ Jack N. Williams Date:
November 16,
1996
Jack N. Williams, Director
By: /s/ Charles Zahka Date:
November 16,
1996
Charles A. Zahka, Director
<PAGE> 40/40
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of Pismo Coast Village, Inc., for the annual period ended
September 30, 1996, and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<CASH> 517,236
<SECURITIES> 0
<RECEIVABLES> 6,122
<ALLOWANCES> 0
<INVENTORY> 59,092
<CURRENT-ASSETS> 668,314
<PP&E> 9,556,472
<DEPRECIATION> 3,912,679
<TOTAL-ASSETS> 6,325,086
<CURRENT-LIABILITIES> 378,701
<BONDS> 0
0
0
<COMMON> 5,647,708
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 6,325,086
<SALES> 445,876
<TOTAL-REVENUES> 2,585,052
<CGS> 255,060
<TOTAL-COSTS> 1,739,856
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 29,498
<INCOME-PRETAX> 279,576
<INCOME-TAX> 97,000
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 182,576
<EPS-PRIMARY> 101.43
<EPS-DILUTED> 101.43
</TABLE>
