<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended Commission File No.
September 30, 1999 0-9180
Thermal Energy Storage, Inc.
(Exact name of registrant as specified in its charter.)
Colorado 95-3333931
(State of incorporation) (IRS Employer Identification No.)
6362 Ferris Square, Suite C
San Diego, CA 92121
(Address of principal executive offices) (Zip Code)
Registrant's telephone number: (858) 453-1395
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 [ ] NO [X]
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: Common Stock, $.001 Par Value - 58,931,289 shares
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<TABLE>
PART I. - FINANCIAL INFORMATION
THERMAL ENERGY STORAGE, INC.
STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS AND NINE MONTHS
ENDED SEPTEMBER 30, 1999 AND 1998
(Unaudited)
(Amounts in thousands, except per share data)
<CAPTION>
Three months ended Nine months ended
September 30 September 30
__________________ _________________
1999 1998 1999 1998
______ ______ ______ ______
<S> <C> <C> <C> <C>
Contract services $ 32 $ 45 $ 46 $ 127
Cost of revenues 40 54 60 103
______ ______ ______ ______
Gross profit (loss) (9) (9) (14) 24
Selling, general and
administrative expenses 1 8 1 25
______ ______ ______ ______
Operating profit (loss) (10) (17) (15) (1)
Transfer fees 1 3
Other income (expense) 1 0 2 (1)
______ ______ ______ ______
Net income (loss) (9) (16) (13) 1
Accumulated deficit -
Beginning of period (4,768) (4,713) (4,764) (4,760)
_______ _______ _______ _______
Accumulated deficit -
End of period (4,777) (4,759) (4,777) (4,759)
Loss per share $ (.00) $ (.00) $ .00 $ .00
<FN>
See Accompanying Notes to Financial Statements
</TABLE>
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<TABLE>
THERMAL ENERGY STORAGE, INC.
BALANCE SHEETS
(Unaudited)
(Amounts in thousands, except per share data)
<CAPTION>
September 1999 December 1998
______________ ______________
<S> <C> <C>
ASSETS
Current assets
Cash $ 13 $ 5
Accounts receivable 0 17
Inventories 1 1
Prepaid expenses 2 2
______ ______
Total current assets 16 25
Property and equipment
less accumulated depreciation of
$109,623 and $109,623 0 0
______ ______
TOTAL ASSETS 16 25
</TABLE>
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' DEFICIT
<S> <C> <C>
Current liabilities
Accounts payable $ 24 $ 24
Accrued payroll 101 101
Payable to officers and affiliates 568 560
______ ______
Total current liabilities 694 685
Stockholder's deficit
Common stock par value $.001 per share
Authorized 110,000,000 shares
Issued and outstanding -
58,931,289 shares 59 59
Additional paid in capital 4,040 4,040
Accumulated deficit (4,777) (4,759)
_______ _______
Total stockholders' deficit $ (678) $ (660)
TOTAL LIABILITIES AND STOCKHOLDERS'
DEFICIT $ 16 $ 25
<FN>
See Accompanying Notes to Financial Statements
</TABLE>
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<TABLE>
THERMAL ENERGY STORAGE, INC.
STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1999 AND 1998
(Unaudited)
(Amounts in thousands)
<CAPTION>
1999 1998
<S> <C> <C>
Cash flow from operating activities:
Income from operations $ (13) $ 1
_______ _______
Adjustments to reconcile net
income to net cash provided by
operating activities
Depreciation 0 0
Decrease (increase) from changes:
Receivables 25 2
Prepaid expenses 0 0
Increase (decrease) from changes:
Accounts payable 0 (35)
Payable to officers & affiliates 0 31
_______ _______
Net cash from operating activities $ 12 $ (1)
_______ _______
Net cash provided from
financing activities $ 0 $ 0
_______ _______
Decrease in cash 12 (1)
Cash at beginning of year $ 1 $ 6
_______ _______
Cash at end of period $ 13 $ 5
<FN>
See Accompanying Notes to Financial Statements
</TABLE>
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THERMAL ENERGY STORAGE, INC.
MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
September 30, 1999
Material Changes in Financial Condition
As of September 30, 1999 cash and cash equivalents amounted to
$13,063 as compared to $990 as of December 31, 1998. The increase
since December 31, 1998 was primarily attributable to a decrease in
accounts receivable of $25,000, and a net loss for the nine months
ended September 30, 1999 of $12,926.
As of September 30, 1999 total shareholders' deficit amounted
to $(678,031) as compared to $(665,104) at December 31, 1998. The
change since December 31, 1998 was attributable to the loss during
the first nine months of $12,926.
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THERMAL ENERGY STORAGE, INC.
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of
1934, the registrant has duly cause this report to be signed on its
behalf by the undersigned thereunto duly authorized.
THERMAL ENERGY STORAGE, INC.
Registrant
April 4, 2000 Richard A. McCormack
Date Richard A. McCormack
President
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> Dec-31-1999
<PERIOD-START> Jan-01-1999
<PERIOD-END> Sep-30-1999
<CASH> 13
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 1
<CURRENT-ASSETS> 16
<PP&E> 109
<DEPRECIATION> 109
<TOTAL-ASSETS> 16
<CURRENT-LIABILITIES> 694
<BONDS> 0
<COMMON> 59
0
0
<OTHER-SE> (678)
<TOTAL-LIABILITY-AND-EQUITY> 16
<SALES> 46
<TOTAL-REVENUES> 46
<CGS> 60
<TOTAL-COSTS> 60
<OTHER-EXPENSES> 1
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> (13)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (13)
<EPS-BASIC> .00
<EPS-DILUTED> .00
</TABLE>
