SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 1998
COMMISSION FILE NO. 2-70345-NY.
TIMEONE, INC.
(Exact name of Registrant as specified in its Charter)
Nevada 88-0182534
(State or other jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
6500 South State Street
Murray, Utah 84107-7219
(Address of Principal Executive Offices)
Registrant's Telephone Number, including Area Code:
(801) 268-9280
Former Address:
n/a
Former Name, Former Address, and Former Fiscal Year,
if changed since last report
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filled by Section 13 or 15(d) of the Securities 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
past 90 days.
(1) Yes: X No:
(2) Yes: X No:
Number of Shares Outstanding at the End of the Fiscal Quarter:
8,354,900 shares of common stock
(Indicate Number of Shares Outstanding of Each Class of Common
Stock as of the end of the Quarter)
Page 1 of 13 consecutively numbered pages.
1
<PAGE>
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS REQUIRED BY FORM 10-QSB
TimeOne, Inc., formerly known as Buffs-N-Puffs, ("Registrant" or
"Company") files herewith an unaudited balance sheet of the Registrant as of
March 31, 1998 and the related statements of income and cash flows for the three
month periods ended March 31, 1998 and 1997. The unaudited financial statements
included in this report on Form 10-QSB have been prepared by the Company and
have not been the subject of independent review. In the opinion of the
management of the Company, the financial statements fairly present the financial
condition of the Company.
2
<PAGE>
TimeOne, Inc.
Consolidated Balance Sheet
(Unaudited)
ASSETS
CURRENT ASSETS March 31,
1998
------------
Cash $ 274,542
Receivables (Note E) 39,139
Inventory (Note A) 21,964
Marketable Securities (Note A) 557,432
Prepaid Expenses & Supplies 52,144
------------
Total Current Assets 945,221
PROPERTY, PLANT AND EQUIPMENT (at cost)
Building 1,494,000
Land - Murray Carwash 581,000
Furniture, Fixture & Equipment 889,443
Improvements 202,691
3,167,134
Less Accumulated Depreciation (849,658)
------------
Total Property, Plant & Equipment 2,317,476
OTHER ASSETS
Joint Venture 19,611
Startup Costs 12,523
Deposit 2,076
Montana Property 52,590
Deferred Tax Benefit 17,000
------------
Total Other Assets 103,800
------------
TOTAL ASSETS $ 3,366,497
============
3
<PAGE>
TimeOne, Inc.
Consolidated Balance Sheet
(Unaudited)
LIABILITIES AND STOCKHOLDERS EQUITY
CURRENT LIABILITIES March 31,
1998
------------
Accounts Payable, Payroll and Sales Tax $ 57,437
Loan Payable 48,130
Loans Payable - Related Parties 163
------------
Total Current Liabilities 105,730
LONG TERM LIABILITIES
Long Term Liabilities 1,684,783
Total Long Term Liabilities 1,684,783
------------
Total Liabilities 1,790,513
STOCKHOLDERS EQUITY
Capital Stock, Common 835
Additional Paid In Capital 1,229,327
Retained Earnings (deficit) 345,822
------------
1,575,984
------------
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY $ 3,366,497
============
4
<PAGE>
TIMEONE, INC.
Consolidated Statement of Operations
(Unaudited)
STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
REVENUES: March 31, March 31,
1998 1997
------------- -------------
<S> <C> <C>
Car Wash $ 281,271 $ 331,204
Boutique - Net 2,121 5,894
Fuel Sales - Net 2,419 3,510
Discounts (21,007) (2,928)
------------- -------------
TOTAL REVENUES 264,804 337,680
COSTS AND EXPENSES:
Salaries, Labor and Commissions 135,271 159,537
Taxes and Benefits 24,698 30,148
Interest and Credit Card Fees 42,678 55,059
Travel, Promotion, Advertising 1,416 4,808
Office, Telephone, Printing and Supplies 30,021 40,512
Utilities, Maintenance, and Insurance 30,219 33,900
Depreciation and Amortization 36,791 36,732
Professional Fees and Other 19,029 32,670
------------- -------------
TOTAL COSTS AND EXPENSES 320,123 393,366
------------- -------------
Net Income (Loss) before Other Income (55,319) (55,686)
Q Lube Income 8,457 0
Contract Services and Miscellaneous 10,072 (7,469)
Interest and Dividends 2,611 7,051
Gain (Loss) on Sale of Securities 86,544 ( 2,673)
------------- -------------
TOTAL OTHER INCOME 107,684 (3,091)
------------- -------------
Net Income (Loss) Before Taxes 52,365 (58,777)
Income Taxes 0 0
------------- -------------
Net Income (loss) $ 52,365 $ (58,777)
============= =============
Net Income Per Share NIL NIL
</TABLE>
5
<PAGE>
TIMEONE, INC.
Consolidated Statement of Stockholders Equity
(Unaudited)
STATEMENT OF STOCKHOLDERS EQUITY
<TABLE>
<CAPTION>
Additional Retained
Common Stock Paid-In Earnings
Shares Amount Capital (Deficit)
-------------- ------------ ---------------- --------------
<S> <C> <C> <C> <C>
Balances 12/31/94 6,113,900 $ 611 $ 1,120,692 $ (122,044)
Net income for
Year ended 12/31/94 109,604
-------------- ------------ ---------------- --------------
Balances 12/31/94 6,113,900 611 1,120,692 $ (12,440)
Net income for
Year ended 12/31/95 133,857
-------------- ------------ ---------------- --------------
Balances 12/31/95 6,113,900 611 1,120,692 $ 121,417
Net income for
Year ended 12/31/96 107,831
Stock issued for assets 2,000,000 200 124,800
Restricted stock issued
To employees 350,000 35 32,776
-------------- ------------ ---------------- --------------
Balances 12/31/96 8,463,900 846 1,278,268 $ 229,248
Net income for
Year ended 12/31/97 64,209
Cancel treasury stock (109,000) (11) (48,941)
-------------- ------------ ---------------- --------------
Balances 12/31/97 8,354,900 835 1,229,327 $ 293,457
Net income for
Quarter ended 3/31/98 52,365
-------------- ------------ ---------------- --------------
Balances 3/31/98 8,354,900 $ 835 $ 1,229,327 $ 345,822
============== ============ ================ ==============
</TABLE>
6
<PAGE>
TIMEONE, INC.
Consolidated Statement of Cash Flows
(Unaudited)
CASH FLOW STATEMENT
<TABLE>
<CAPTION>
Three Months Ended
March 31,1998 March 31,1997
--------------- ---------------
OPERATING ACTIVITIES:
<S> <C> <C>
Net Income (Loss) $ 52,365 $ (58,777)
Adjustments to reconcile net income (loss) to net cash
Provided by operating activities:
Joint Venture Income (8,457) 0
Write off obsolete asset 0 8,895
Depreciation and amortization 36,791 36,732
(Increase) decrease in receivables 12,532 (1,248)
(Increase) decrease in prepaid expenses, supplies and deposits (1,719) 3,798
(Increase) decrease in inventory 4,336 (3,556)
Increase (decrease) in accounts payable and payroll tax payable 23,283 58,445
--------------- ---------------
NET CASH PROVIDED BY OPERATING ACTIVITIES 119,131 44,289
INVESTING ACTIVITIES:
Cost of securities sold 87,409 8,273
Purchase of securities (252,884) (6,069)
Purchase of property and equipment 0 (80,574)
Joint venture distribution 63,073 0
Decrease in deposits 425 0
--------------- ---------------
NET CASH USED BY INVESTING ACTIVITIES (101,977) (78,370)
FINANCING ACTIVITIES:
Repayment of loans and leases (12,827) (61,697)
--------------- ---------------
NET CASH USED BY FINANCING ACTIVITIES (12,827) (61,697)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 4,327 (95,778)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 270,215 225,496
--------------- ---------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 274,542 $ 129,718
=============== ===============
</TABLE>
7
<PAGE>
TIMEONE, INC.
Notes to Consolidated Financial Statements
(Unaudited)
NOTE A - Summary of Significant Accounting Policies
Revenue Recognition
Interest income is accrued as earned. Gains or losses on the sale of
securities are recorded as of the trade date.
Depreciation
Depreciation on office equipment and furniture is provided over the
estimated useful life of five to ten years using an accelerated method
and depreciation on the office building is being provided over the
estimated useful life of 30 to 31.5 years using the straight line
method.
Marketable Securities
Marketable securities, as a group, are carried at market value in
accordance with FAS #115. Prior to January 1, 1994, the securities were
carried at the lower of cost or market. At December 31, 1997, an
increase of $69,305 was made to adjust to market ($31,549 decrease was
made for 1996 and $10,207 increase was made for 1995).
Income Taxes
No federal income taxes were due for the year ended December 31, 1997.
At December 31, 1997, the Company had unused general business credits
of $7,844 which expire in 1998 thru 2000, and contributions carryover
of $40,386, expiring in 1998 through 2001. The Company also has a
federal net operating loss carryover of $92,031 which if not used, will
expire December 31, 2006.
Inventory
Inventory consists of items for sale and use in the operations of the
carwash. Inventory is recorded at lower of cost or market, on a
first-in, first-out basis.
Cash and Cash Equivalents
For financial statement purposes, the company considers all highly
liquid investments with an original maturity of three months or less
when purchased to be cash equivalents.
Estimates:
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets,
liabilities, revenues, and expenses during the reporting period.
Estimates also affect the disclosure of contingent assets and
liabilities at the date of the financial statements. Actual results
could differ from these estimates. Such estimates of significant
accounting sensitivity are allowance for doubtful accounts and reserves
for obsolete inventory.
8
<PAGE>
NOTE B - COMMITMENTS
The company is also obligated under a maintenance contract on its
signs. The contract was signed to be effective in December 1996 and
runs through December 1999. The cost is $789 monthly.
NOTE C - LOANS PAYABLE
In March 1996, the Company purchased the carwash buildings and land
from Daniel F. Pentelute for $2,075,000. The purchase price was below
the appraised value of 2,400,000 actual and $3,600,000 replacement
cost. The loan agreements were signed with Bank One, Utah for
$1,800,000 at an interest rate of 8.26% with 20 year amortization and 5
year call. A line of credit for $150,000 with an interest rate of 8.25%
was also taken out. The line of credit was repaid in 1997. The
following is a summary of debt at March 31, 1998 and 1997.
<TABLE>
<CAPTION>
Interest 1998 1997
Rate % Current Long-Term Current Long-Term
---------------- ---------------- ------------------ --------------- ------------------
<S> <C> <C> <C> <C> <C>
Bank One Mortgage (1) 8.26 $ 42,140 $ 1,681,810 $ 47,417 $ 1,716,146
Bank One Line of Credit 8.25 0 0 100,000 0
9.50 5,990 2,973 5,000 10,553
Escrow Services (2)
Daniel Pentelute 8.75-10.50 163 0 163 0
G.Phillip Condie * 7.50 0 0 0 120,000
---------------- ------------------ --------------- ------------------
$ 48,293 $ 1,684,783 $ 152,580 $ 1,846,699
================ ================== =============== ==================
</TABLE>
* The Condie loan was repaid during 1997
Monthly payments are $15,487 and the balance is due March 25, 2001. The
loan is secured by land and buildings with a cost of $2,075,000.
Monthly payments are $1,155. The loan is secured by land with a cost of
$52,590.
Scheduled principal reductions for the next five years are as follows:
12/31/98 $ 48,293
12/31/99 52,507
12/31/2000 49,815
Thereafter 1,582,461
-----------
$ 1,733,076
===========
9
<PAGE>
NOTE D - DEFERRED TAX ASSET
In February, 1992, the Financial Account Standards board adopted
Statement of Financial Accounting Standards No. 109 Accounting for
Income Taxes, which supersedes substantially all existing authoritive
literature for accounting for income taxes and requires deferred tax
balances to be adjusted to reflect the tax rates in effect when those
amounts are expected to become payable or refundable. The Statement was
applied in the Company's financial statements for the calendar year
commencing January 1, 1993 by recognizing the cumulative effect of the
change during 1993.
NOTE E - RECEIVABLES
Receivables at March 31, 1998 and 1997 consisted of the following:
March 31, March 31,
1998 1997
---------- ----------
Trade accounts receivable $ 39,139 $ 16,970
---------- ----------
NOTE F - MONTANA LAND
During 1994, Daniel Pentelute, the major shareholder of the Company,
purchased 21 acres of land in Montana and three (3) days later sold a
one-half interest to the Company at his cost. The other one-half
interest is owned by Desert Land Enterprises, whose sole shareholder is
Daniel Pentelute.
10
<PAGE>
PART I
FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND OPERATING RESULTS.
Changes in Financial Condition
At March 31, 1998 the Company had current assets of $945,221 compared
to $790,570 as of December 31, 1997. Cash increased $4,327 from
$270,215 as of December 31, 1997 to $274,542 as of March 31, 1998. This
increase is due to the sale of marketable securities. Current
liabilities increased $23,283 from $82,447 as of December 31, 1997 to
$105,730 as of March 31, 1998. This increase is due to larger accounts
payable for the quarter. Inventory decreased $4,336 from $26,300 as of
December 31, 1997 to $21,964 as of March 31, 1998.
Changes in Results of Operations
Carwash volume decreased 5,043 cars from 23,945 for the 3 month period
ended March 31, 1997 to 18,902 for the same period ended March 31,
1998. Volume reduction can be traced to the El Nino weather patterns
bringing above average rain and snowfall to the Western U.S. The
carwash was closed or did less than 100 cars on 30 of the 90 days this
quarter.
Revenue for the 3 month period ended March 31, 1998 was $264,804
compared to $337,680 for the same 3 month period ended March 31, 1997,
a decrease of $72,876 or 27.5%. The revenue decrease is due to lower
wash volume.
During the 3 months ended March 31, 1998 costs and expenses were
$320,123 compared to $393,366 for the same period ended March 31, 1997,
a decrease of $73,243 or 23%. Costs and expenses were lower in all
categories, reflecting the drop in volume at the carwash.
At March 31, 1998 the Company posted a net profit of $52,365 compared
to a net loss of ($58,777) for the same period ended March 31, 1997.
Net profit per share for the period was negligible. The profit for the
quarter is due to the income from the Q Lube joint venture and the sale
of marketable securities. The carwash operation continues to be
unprofitable, during the first quarter of the year, which has included
very unfavorable weather conditions.
As of March 31, 1998 cash and equivalents were $274,542 compared to
$129,718 for the same period ended March 31, 1997.
The current ratio as of March 31, 1998 was 8.93 compared to 2.05 as of
March 31, 1997. Long term liabilities were $1,684,783 as of March 31,
1998 compared to $1,845,480 as of March 31, 1997. Management believes
sufficient working capital exists for its continuing operations.
11
<PAGE>
PART II.
ITEM 1. LEGAL PROCEEDINGS
During the reporting period the Company was not party to any legal
proceedings.
ITEM 2. CHANGES IN SECURITIES
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
The Registrant has no securities which are reportable under this item.
ITEM 4. MATTERS SUBMITTED TO A VOTE OF THE COMPANY'S
SHAREHOLDERS
No matters were submitted to a vote of the Company's shareholders
during this quarter.
12
<PAGE>
SIGNATURE
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.
TimeOne, Inc.
By: /s/ Alan R. Theis
Alan R. Theis
On Behalf of the Registrant
and as Secretary/Treasurer
and Vice President
Dated May 6,1998.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted
from TimeOne, Inc. March 31, 1998 financial statements and is
qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CIK> 0000350133
<NAME> TimeOne, Inc.
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> MAR-31-1998
<CASH> 274,542
<SECURITIES> 557,432
<RECEIVABLES> 39,139
<ALLOWANCES> 0
<INVENTORY> 21,964
<CURRENT-ASSETS> 945,221
<PP&E> 3,167,134
<DEPRECIATION> (849,658)
<TOTAL-ASSETS> 3,366,497
<CURRENT-LIABILITIES> 105,730
<BONDS> 1,684,783
0
0
<COMMON> 835
<OTHER-SE> 1,575,149
<TOTAL-LIABILITY-AND-EQUITY> 3,366,497
<SALES> 264,804
<TOTAL-REVENUES> 372,488
<CGS> 0
<TOTAL-COSTS> 320,123
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 42,678
<INCOME-PRETAX> 52,365
<INCOME-TAX> 0
<INCOME-CONTINUING> 52,365
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 52,365
<EPS-PRIMARY> .00
<EPS-DILUTED> .00
</TABLE>
