FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Quarterly Report Under Section 13 or 15 (d)
of the Securities Exchange Act of 1934
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the third quarterly period ended March 31, 1997
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to _______________
For Quarter Ended Commission File Number
March 31, 1997 0-9735
CDX CORPORATION
(Exact name of registrant
as specified in its charter)
COLORADO 84-0771180
(State of Incorporation) (I.R.S. Employer
Identification Number)
Two Charles Street
Providence, RI 02904
(Address of principal
executive offices) (Zip Code)
Registrant's telephone number, including area code (401) 274-9518
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 ninety days.
YES NO X
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
CLASS SHARES OUTSTANDING AT MARCH 31, 1997
Common, $.01 par value 4,888,094
<PAGE> 2
CDX CORPORATION
FORM 10-QSB QUARTERLY REPORT
Table of Contents
PART I - FINANCIAL INFORMATION
Item 1.
Financial Statement:
Condensed Balance Sheets as of March 31, 1997
and June 30, 1996 . . . . . . . . . . . . . . . . . . . . . 3
Condensed Statements of Operations - Three months ended
March 31, 1997 and March 31, 1996 . . . . . . . . . . . . . 4
Condensed Statements of Operations - Nine months ended
March 31, 1997 and March 31, 1996 . . . . . . . . . . . . . 5
Condensed Statements of Cash Flows - Nine months
ended March 31, 1997 and March 31, 1996 . . . . . . . . . . 6
Notes to Condensed Financial Statements . . . . . . . . . . 7
Item 2.
Management's Discussion and Analysis of
Financial Condition and Results of Operations . . . . . . . 8
Other Information . . . . . . . . . . . . . . . . . . . . . 9
<PAGE> 3
CDX CORPORATION
CONDENSED BALANCE SHEETS
ASSETS
March 31, 1997 June 30,1996
(unaudited) (note)
Current Assets:
Cash and Cash Equivalents $ 24,832 $ 69
Accounts Receivable, Net 38,143 53,177
Inventory 57,534 73,587
Prepaid Expenses & Other 9,855 6,497
Total Current Assets 130,364 133,330
Property at Cost:
Furniture & Equipment 187,436 186,754
Less Accumulated Depreciation (167,674) (163,948)
Property-Net: 19,762 22,806
Intangible Assets, Net: 63,247 27,945
Total Assets $ 213,373 $ 184,081
LIABILITIES AND STOCKHOLDERS' EQUITY
March 31, 1997 June 30,1996
(unaudited) (note)
Current
Liabilities:
Accounts Payable-Trade $ 198,138 $ 182,659
Accounts Payable-Affiliate 265,817 243,544
Note Payable 55,000 55,000
Notes Payable-Officers 207,523 119,859
Accrued Expenses & Other 50,726 64,826
Total Current Liabilities 777,204 491,028
Stockholders' Equity:
Common Stock,$.01 Par Value
Authorized 10,000,000 Shares
Issued: 3,588,094 ; 3,398,093 48,881 35,881
Capital Surplus 4,771,798 4,771,798
Accumulated Deficit - (5,384,510) (5,289,485)
Less Treasury Stock,
166 Shares;
No Assigned Value -------- --------
Total Stockholder's Equity $ (563,831) $ (481,806)
Total $ 213,373 $ 184,081
Note: The balance sheet at June 30, 1996, has been taken from the audited
financial statement at that date and condensed.
<PAGE> 4
CDX CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
Three Months Ended
March 31, 1997 March 31, 1996
Revenues:
Net Sales & Other Revenues $ 122,698 $ 87,351
Operating Costs & Expenses:
Cost of Sales 58,202 49,285
Selling & Administrative
Expenses 59,859 91,660
TOTAL OPERATING COSTS &
EXPENSES 118,061 140,945
Operating Income (Loss) 4,637 (53,594)
Other Income/(Expense)
Interest Expense 3,060 2,520
Interest Income 1 1
Other Income 3,659 886
Other Expense 0 0
Income (Loss) Before Income Taxes 5,237 (55,227)
Provision for Income Taxes --- ---
Net Earnings (Loss) $ (5,237) $ (55,227)
Net Earnings (Loss) per $ (.001) $ (.015)
Common Share
WEIGHTED-AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 4,888,094 3,588,093
<PAGE> 5
CDX CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(unaudited)
Three Months Ended
March 31, 1997 March 31, 1996
Revenues:
Net Sales & Other Revenues $ 307,903 $ 286,561
Operating Costs & Expenses:
Cost of Sales 155,069 164,278
Selling & Administrative
Expenses 231,442 290,112
TOTAL OPERATING COSTS &
EXPENSES 386,511 454,390
Operating Income (Loss) (78,608) (167,829)
Other Income/(Expense)
Interest Expense 10,601 7,500
Interest Income 2 94
Other Income 0 8,866
Other Expense (5,569) (138)
Income (Loss) Before Income Taxes (94,776) (166,507)
Provision for Income Taxes --- ---
Net Earnings (Loss) $ (94,776) $ (166,507)
Net Earnings (Loss) per $ (.019) $ (.046)
Common Share
WEIGHTED-AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING 4,888,094 3,598,093
<PAGE> 6
CDX CORPORATION
CONDENSED STATEMENTS OF CASH FLOW
(unaudited)
Nine Months Ended
March 31, 1997 March 31, 1996
OPERATING ACTIVITIES:
Net (Loss) $ (95,025) $ (166,507)
Adjustments to Reconcile
Net Loss to Net Cash Provided/
(Used) by Operating Activities:
Depreciation & Amortization 9,900 17,298
Changes in Operating
Assets & Liabilities:
Accounts Receivable 15,034 3,915
Inventory 16,053 24,312
Prepaid Expenses (2,558) 4,871
Accounts Payable-Trade 15,479 51,645
Accounts Payable-Affiliate 22,273 30,852
Accrued Expenses (14,099) (13,800)
Total Adjustments 62,082 119,093
Net Cash (Used for)
Operating Activities (32,943) (47,414)
INVESTING ACTIVITIES:
Purchase of Equipment (682) (1,760)
Acquisition of Assets-Other (42,276) (6,972)
Net Cash (Used for)
Investing Activities (42,958) (8,732)
FINANCING ACTIVITIES:
Short-term Borrowings 87,664 20,445
Issuance of Common Stock 13,000
Net Cash Provided by
Financing Activities 100,664 20,445
Net (Decrease) in Cash
and Cash Equivalents 24,763 (35,701)
Cash and Cash Equivalents,
Beginning of Period (69) 36,142
Cash and Cash Equivalents,
End of Period $ 24,832 $ 441
<PAGE> 7
CDX CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
1. In the opinion of Management, the unaudited condensed financial
statements contain all adjustments (consisting of normal accruals) necessary
to present fairly the financial position as of March 31, 1997, the results
of operations for the three months ended March 31, 1997 and March 31, 1996,
and the nine months ended March 31, 1997 and March 31, 1996 and the cash
flows for the nine months ended March 31, 1997 and March 31, 1996. These
statements should be read in conjunction with the audited financial
statements and notes thereto included in the Company's Annual Report on
Form 10-K for the year ended June 30, 1996.
2. Inventory consists of the following at March 31, 1997 and June 30,
1996.
March 31, 1997 June 30, 1996
(Unaudited)
Raw Material $ 29,886 $ 35,720
Work-in-Process 353 3,643
Finished Goods 27,315 34,224
Total $ 57,534 $ 73,587
3. Intangible assets consist of the following at March 31, 1997 and
June 30, 1996.
March 31, 1997 June 30, 1996
Invention Rights, Net $ 17,872 $ 22,750
Software Development Costs 45,375 5,195
Total $ 63,274 $ 27,945
4. Accounts Payable-Affiliate represents rent and related expenses of
office space.
<PAGE> 8
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations
The Company had net earnings of $5,237 for the three months ended
March 31, 1997 compared with a net loss of ($55,227) for the comparable
period in the prior year.
Net sales and operating revenues for three months ended March 31,
1997, increased by 40% or $35,347, over the equivalent period in the
prior year. Increased sales volume is related primarily to greater
export sales of disposable products and new customers.
Cost of sales as a percentage of net sales and operating revenues
decreased by 9% from 56% to 47% reflecting a greater portion of sales
in the disposable supplies category compared with the same period
in the prior year.
Sales and administrative expenses in the three months ended March
31, 1997, decreased by 56% as compared to the same period in the prior
year. This is primarily due to a curtailment during the period of
marketing and advertising expenses associated with its CPR mask and a
reduction in payments to several outside sales consultants.
Sales are expected to level off or reduce slightly during the
fourth quarter FY97 due to a decline in export orders. The Company
expects sales of spirometers to increase upon release of its new model
scheduled for release during FY98.
Liquidity
Working capital deficit at March 31, 1997 increased by $115,083
from June 30, 1996. This increase in the working capital deficit was
primarily due to an increase in short term borrowings from several
officers and an increase in non-current assets arising from investment
in new product development.
Inventory in finished goods and parts and materials decreased by
$12,743 during the period as prior stock was consumed to fill customer
orders. Receivables decreased during the period by $15,034 reflecting
an increase in collection activities from the second quarter FY97.
<PAGE> 9
Capital Resources
The Company made a private placement of a note in the amount of
$15,000 to an officer during this third quarter FY97.
Management has committed approximately $100,000 to capital
expenditures relating to the development of its new spirometer and the
marketing of that unit
Research and Development Resources
CDX has a new spirometer in the advanced development stage.
Management continues to fund the R&D efforts in connection with this
product as needed.
<PAGE> 10
PART II
OTHER INFORMATION
ITEM 1 LEGAL PROCEEDINGS -
Neither the Registrant nor any of its affiliates
are a party, nor is any of their property subject, to material
pending legal proceedings or material proceedings known to be
contemplated by governmental authorities.
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 -
None
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K -
A. Exhibits
Exhibit 27. Financial Data Schedule
B. Reports on Form 8-K
None
ADDITIONAL EXHIBITS -
The exhibits required to be furnished are either not
applicable or the information can be clearly determined
from the filed material.
<PAGE> 11
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has dully caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CDX Corporation
/S/ Philip D. Schein
_________________________________________
Philip D. Schein, President and Secretary
/s/ Harold I. Schein
_______________________________________
Harold I. Schein, Chairman of the Board,
and Treasurer
Date: May 1, 1998
<PAGE> 12
INDEX TO EXHIBITS
(a) Exhibits:
The following documents are filed herewith or have been included as
exhibits to previous filings with the Commission and are incorporated
herein by this reference:
Exhibit No. Document
* 3.1 Restated Articles of Incorporation dated
July 3, 1985
(incorporated by reference to the exhibits
and Registrant's report filed on Form 10-K
dated September 25, 1985)
* 3.2 Articles of Amendment dated December 4, 1987
to the Restated Articles of Incorporation
(incorporated by reference to the exhibits
to Registrant's report filed on Form 10-K
dated September 15, 1989)
* 3.3 Bylaws dated July 5, 1985
(incorporated by reference to the exhibits
to Registrant's report filed on Form 10-K
dated September 15, 1989)
______________
* Incorporated by reference from the issuer's Annual Report Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000351129
<NAME> CDX Corporation
<MULTIPLIER> 1
<CURRENCY> U.S.
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 1
<CASH> 24,832
<SECURITIES> 0
<RECEIVABLES> 38,143
<ALLOWANCES> 0
<INVENTORY> 57,534
<CURRENT-ASSETS> 130,364
<PP&E> 187,436
<DEPRECIATION> (167,674)
<TOTAL-ASSETS> 213,373
<CURRENT-LIABILITIES> 777,204
<BONDS> 263,523
0
0
<COMMON> 48,881
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> (563,831)
<SALES> 122,698
<TOTAL-REVENUES> 122,698
<CGS> 58,202
<TOTAL-COSTS> 118,061
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 4,637
<INTEREST-EXPENSE> 3,060
<INCOME-PRETAX> 5,237
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,237
<EPS-PRIMARY> .001
<EPS-DILUTED> .001
