<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (D)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended March 31, 1996 Commission File No. 0-8488
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TWENTY SERVICES, INC.
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(Exact name of Registrant as specified in its charter)
ALABAMA 63-0372577
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(State or other jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
105 Vulcan Road 35209
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(Address or principal executive offices) (Zip Code)
Registrant's telephone number, including area code (205) 945-l58l
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Former name, former address, and former fiscal year, if changed
since last report.
Indicate by check mark whether the Registrant (l) has
filed all reports required to be filed by Section l3
or l5 (d) of the Securities Exchange Act of 1934 during
the preceding l2 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 ninety (90) days.
YES X NO
---- ----
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the period of this
report.
Par Value $0.l0 per share l,283,068 shares
1
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TWENTY SERVICES, INC.
INDEX
<TABLE>
<S> <C>
Twenty Services, Inc. Financial Statements
(Unaudited)
Condensed Balance Sheets
March 31, 1996 and December 3l, 1995 3
Condensed Statements of Operations
Three Months Ended March 31, 1996 and 1995 4
Condensed Statements of Cash Flows
Three Months Ended March 31, 1996 and 1995 5
Management's Discussion and Analysis of Financial
Condition and Results of Operations 6-7
Other Information 8
Signatures 9
</TABLE>
2
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TWENTY SERVICES, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
Assets
<TABLE>
<CAPTION>
March 31, December 31,
1996 1995
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<S> <C> <C>
Cash and temporary investments $ 528,975 $ 41,379
Receivable-American Equity Investment
Life Holding Company 0 4l0,000
Marketable securities l,32l,859 l,532,614
Investment-American Equity
Investment Life Holding Company 790,000 790,000
Finance receivables, net 413,858 372,059
Property and equipment, net 44,679 2l,080
Other assets 46,202 43,482
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Total assets $3,145,573 $3,210,614
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LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Accounts payable and accrued expenses $ 9,473 $ 11,637
Income taxes payable l8,500 31,000
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Total liablities 27,973 42,637
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Stockholders' equity:
Preferred stock, Cumulative, $.l0
par value 50,5ll 50,5ll
Common Stock, par value $.l0 l28,307 l28,307
Additional paid-in capital l,7l6,074 l,7l6,074
Retained earnings l,239,432 l,262,545
Net unrealized gain (loss) on
available-for sale securities 43,276 70,540
Less investment in Twenty Services
Holding, Inc. (60,000) (60,000)
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Net stockholders' equity 3,l17,600 3,167,977
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Total liabilities and
stockholders' equity $3,l45,573 $3,210,614
========== ==========
</TABLE>
3
<PAGE>
TWENTY SERVICES, INC.
CONDENSED STATEMENT OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ending
March 31,
-----------------------------
1996 1995
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<S> <C> <C>
Revenues $37,225 $65,746
Expenses:
General and
Administrative 41,122 67,149
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Loss from operations (3,897) (l,403)
Other income:
Gain on sale of property
and investments 2l,l42 ll,96l
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Income before income taxes l7,245 l0,558
Provision for
income taxes 5,000 2,750
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Net income (loss) $ l2,245 $ 7,808
========= =========
Weighted average number
of common shares
outstanding l,283,068 l,283,068
========= =========
Earnings per share* $ .00 $ .00
========= =========
</TABLE>
* After giving effect on a pro-rata basis to anticipated
preferred dividends of $.07 per share per annum on
505,ll0 shares.
4
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TWENTY SERVICES, INC.
CONDENSED STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 3l,
-------------------------------
1996 1995
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<S> <C> <C>
Cash flows from operating activities:
Interest and dividends received $ 29,840 $ 44,207
Rental income l,088 -
Cash paid employees and suppliers ( 42,780) ( 45,515)
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Net cash used by operating activities (11,852) (l,308)
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Cash flows from investing activities:
Principal collected on loans 459,445 31,457
Loans made to customers (92,000) (45,500)
Purchase of securities - (l50,000)
Proceeds from sale of assets
and securities 191,578 l52,970
Principal collected on held-to-maturity
securities 281 499
Purchase of property and equipment (24,498) (5,479)
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534,806 (l6,053)
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Cash flows from financing activities:
Preferred stock dividends (35,358) (35,357)
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Net cash used by financing activities (35,358) (35,357)
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Net decrease in cash 487,596 (52,718)
Cash, beginning of period 4l,379 29l,271
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Cash, end of period $ 528,975 $ 238,553
========== =========
</TABLE>
5
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MANAGEMENT'S DISCUSSION AND ANLAYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
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During the three months ended March 31, 1996, the Registrant's liquidity
increased primarily as a result of collection of loans and other receivables
offset by the payment of dividends on preferred stock. The Company has no notes
payable nor long term debt and does not anticipate the need for borrowing in the
near future. The Registrant has sufficient cash and temporary cash investments
to meet its short term liquidity needs. Should long term liquidity needs exceed
cash and temporary cash investments, then the Registrant would dispose of
marketable securities as it deems appropriate. Current trends and known demands
and commitments do not create a need for liquidity in excess of the Company's
current abilities to generate liquidity.
The Company anticipates that its operating activities will continue to use
net cash flows, that its investing activities will generate positive net cash
flows and that its financing activities will continue to use cash flows.
During the first quarter of 1996, the Registrant concentrated upon (i)
collecting its loans, including those considered in determining the allowance
for loan losses and (ii) the selective extension of credit to customers and
investment of excess cash at rates commensurate with risk assumed. In addition,
the Registrant selected investments based on maximizing its return on those
investments commensurate with the risk assumed.
RESULTS OF OPERATIONS
---------------------
The Registrant reported net income of $12,245 for the three (3) months
ended March 31, 1996 as compared to net income of $7,808 for the corresponding
1995 period. The increase was primarily due to an increase in the gain on the
sale of property and marketable securities of approximately $9,000 offset by
related income taxes.
REVENUES
- --------
Revenues declined from $65,746 for the three months ended March 31, 1995 to
$37,225 for the corresponding 1995 period due to approxmiately $27,000 decrease
in interest income and approximately $2,500 decrease in dividend income. Lease
income increased approximately $1,000. These changes resulted from a shift in
invested assets.
6
<PAGE>
EXPENSES
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General and administrative expenses decreased from $67,149 in 1995 to
$41,122 for the corresponding 1996 period due primarily to decreased payroll
costs of approximately $13,000, costs of servicing reporting to stockholders of
approximately $12,000 and reduced professional services of $l,000.
- --------------------------------------------------------------------------------
The above financial statements include all the adjustments which, in the opinion
of Management, are necessary for a fair presentation of such financial
information in conformity with generally accepted accounting principles. All
adjustments are of a normal, recurring nature.
7
<PAGE>
PART II
OTHER INFORMATION
Item l. Legal Proceedings - None
Item 2. Changes in Securities - None
Item 3. Defaults Upon Senior Securities - None
Item 4. Submission of Matters to a Vote of Security Holders -
None
Item 5. Other Information -
On February 15, 1996 the Board of Directors of the
Registrant declared a cash dividend of SEVEN CENTS ($.07)
per share, payable March 3l, 1996 to holders of record at
March 15, 1996 of Series A-1980, Series A-1981, Series A-1982
and Series A-1985 Preferred Stock, which dividend relates to
the year ended December 3l, 1995. On March 31, 1996, the
dividend so declared was paid in the amount of approximately
$35,358.
8
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TWENTY SERVICES, INC.
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 thereunto duly authorized.
TWENTY SERVICES, INC.
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(Registrant)
May 10, 1996 /s/ Thomas L. Hinson, Jr.
- ------------------------- -----------------------------------
Date Thomas L. Hinson, Jr.
Executive Vice-President and
Treasurer
9
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 3-MOS
<FISCAL-YEAR-END> MAR-31-1996 DEC-31-1995
<PERIOD-START> JAN-01-1996 JAN-01-1995
<PERIOD-END> MAR-31-1996 MAR-31-1995
<CASH> 528,975 41,379
<SECURITIES> 1,321,859 1,532,614
<RECEIVABLES> 441,551 814,334
<ALLOWANCES> 27,293 27,293
<INVENTORY> 0 0
<CURRENT-ASSETS> 0 0
<PP&E> 78,195 53,697
<DEPRECIATION> 33,516 32,617
<TOTAL-ASSETS> 3,145,573 3,210,614
<CURRENT-LIABILITIES> 27,973 42,637
<BONDS> 0 0
0 0
50,511 50,511
<COMMON> 128,307 128,307
<OTHER-SE> 2,938,782 2,989,159
<TOTAL-LIABILITY-AND-EQUITY> 3,145,573 3,210,614
<SALES> 37,225 65,746
<TOTAL-REVENUES> 37,225 65,746
<CGS> 0 0
<TOTAL-COSTS> 41,122 67,149
<OTHER-EXPENSES> 0 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 0 0
<INCOME-PRETAX> 17,245 10,558
<INCOME-TAX> 5,000 2,750
<INCOME-CONTINUING> 12,245 7,808
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 12,245 7,808
<EPS-PRIMARY> .00 .00
<EPS-DILUTED> .00 .00
</TABLE>
