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 the Quarter Ended August 31, 1997
Commission File No. 33-2749
FIRST MORTGAGE CORPORATION
(Exact name of registrant as specified in its charter)
Incorporated under the laws of
the State of Utah 87-0320209
------ -------------
(State or other jurisdiction of (I.R.S. Employer
incorporation of organization) Identification Number)
257 East 200 South, Suite 950, Salt Lake City, Utah 84111
(Address of Principal Executive Offices)
Registrant's telephone number, including area code
(801) 363-7663
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 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.
(1) Yes X No
--- ---
(2) Yes X No
--- ---
Indicate the number of shares outstanding of each class of common stock as
of August 31, 1996
51,101,680 Common Stock (Par Value $.001)
--------------------------------------------
<PAGE>
FIRST MORTGAGE CORPORATION
Form 10-Q
Six Months Ended August 31, 1997
INDEX
-------
Page
------
PART I Financial Information
ITEM 1 Financial Statements
Accountant's Review Letter . . . . . . . . . . . . . . . . . . . . 1
Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Statements of Operations . . . . . . . . . . . . . . . . . . . . . 4
Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . 5
Notes to Financial Statements. . . . . . . . . . . . . . . . . . . 6
Management's Discussion and Analysis of
the Statement of Income. . . . . . . . . . . . . . . . . . . . . . 7
PART II Other Information
ITEM 1 Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . 8
ITEM 2 Changes in Securities . . . . . . . . . . . . . . . . . . . . 8
ITEM 3 Defaults upon Senior Securities . . . . . . . . . . . . . . . 8
ITEM 4 Submission of Matters to a Vote of Security Holders . . . . . 8
ITEM 5 Other Information . . . . . . . . . . . . . . . . . . . . . . 8
ITEM 6 Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . 8
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
<PAGE>
FIRST MORTGAGE CORPORATION
Balance Sheets
August 31, 1997 and February 28, 1997
<TABLE>
<CAPTION>
August February
31, 1997 28, 1997
------------ ------------
<S> <C> <C>
ASSETS
Current Assets
- --------------
Cash in Bank $ 154,109 $ 48,153
Cash in Savings 422,000 422,000
Contracts Receivable -0- 34,430
Prepaid Taxes -0- 4,742
------------ ------------
Total Current Assets 576,109 509,325
Fixed Assets
- ------------
Office Equipment 2,357 -0-
Leasehold Improvements 540 610
------------ ------------
Total Fixed Assets 2,897 610
Other Assets
- ------------
Land - (Note #4) 47,968 43,640
------------ ------------
Total Other Assets 47,968 43,640
------------ ------------
TOTAL ASSETS $ 626,974 $ 553,575
============ ============
</TABLE>
(See Accompanying Notes)
2<PAGE>
FIRST MORTGAGE CORPORATION
Balance Sheets -Continued-
August 31, 1997 & February 28, 1997
<TABLE>
<CAPTION>
August February
31, 1997 28, 1997
------------ ------------
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
- -------------------
Accounts Payable $ -0- $ -0-
Taxes Payable 16,102 -0-
------------ ------------
Total Current Liabilities 16,102 -0-
Stockholders' Equity
- --------------------
Common Stock, 100,000,000
Shares Authorized at $0.001 Par Value;
51,101,680 Shares Issued and Outstanding 51,102 51,102
Capital in Excess of Par Value 242,697 242,697
Retained Earnings 317,073 259,776
------------ ------------
Total Stockholders' Equity 610,872 553,575
------------ ------------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 626,974 $ 553,575
=========== ===========
</TABLE>
(See Accompanying Notes)
3<PAGE>
FIRST MORTGAGE CORPORATION
Statements of Operations
For the Six Month Period August 31, 1997 & 1996
and the Three Month Period Ended August 31, 1997 & 1996
<TABLE>
<CAPTION>
Six Month Period Ended Three Month Period Ended
August August August August
31, 1997 31, 1996 31, 1997 31, 1996
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues
- --------
Mortgage Recovery $ 100,070 $ 28,000 $ 81,927 $ 5,000
Interest 11,946 8,684 7,002 4,373
Bad Debt Recovery 796 1,696 416 404
----------- ----------- ----------- -----------
Total Revenues 112,812 38,380 89,345 9,777
Expenses
- --------
Commission Expense 18,800 16,200 11,800 3,000
Interest Expense -0- 1,564 -0- 1,564
Office Expense 3,336 2,697 1,878 1,200
Rent 4,350 4,350 2,175 2,175
Professional Fees 4,080 4,100 4,080 3,100
Telephone 1,026 998 519 502
Depreciation 372 186 203 93
Land Expense 249 -0- -0- -0-
Travel 7,201 447 6,044 300
Taxes -0- 15 -0- -0-
----------- ----------- ----------- -----------
Total Expenses 39,414 30,557 26,699 11,934
----------- ----------- ----------- -----------
Net Profit Before Taxes 73,398 7,823 62,646 ( 2,157)
Income Taxes 16,102 1,173 13,795 324
----------- ----------- ----------- -----------
Net Profit After Taxes $ 57,296 $ 6,650 $ 48,851 ($ 1,833)
=========== =========== =========== ===========
Earnings Per Share $ .001 $ .00 $ .001 $ .00
Weighted Average
Shares Outstanding 51,101,680 51,101,680 51,101,680 51,101,680
</TABLE>
(See accompanying notes)
4<PAGE>
FIRST MORTGAGE CORPORATION
Statements of Cash Flows
For the Six Months Periods Ended August 31, 1997 & 1996
<TABLE>
<CAPTION>
(Unaudited) (Unaudited)
1997 1996
----------- -----------
<S> <C> <C>
Cash Flows from Operating Activities
- ------------------------------------
Net Income (Loss) $ 57,296 $ 6,650
Adjustments to Reconcile Net Income
or (Loss) to Operating Activities:
Depreciation 372 186
Changes in Operating Assets & Liabilities:
Decrease in Prepaid Taxes 4,742 2,128
(Decrease) Increase in Accounts Payable -0- ( 897)
Increase (Decrease) in Taxes Payable 16,102 1,173
----------- -----------
Net Cash Provided by Operating Activities 78,512 9,240
Cash Flows from Investing Activities
- ------------------------------------
Purchase of Equipment ( 2,658) -0-
Purchase of Land ( 4,328) ( 3,102)
Collected on Contracts 34,430 126,000
Payment on Long Term Debt -0- ( 136,000)
----------- -----------
Net Cash Provided by Investing Activities 27,444 ( 13,102)
Cash Flows from Financing Activities
- ------------------------------------
Net Cash Provided by Financing Activities -0- -0-
----------- -----------
Increase (Decrease) in Cash 105,956 ( 3,862)
Cash at Beginning of Year $ 470,153 $ 340,577
----------- -----------
Cash at End of Year $ 576,109 $ 336,715
=========== ===========
Expense Disclosures
- -------------------
Interest $ -0- $ 1,564
Taxes 16,102 1,173
</TABLE>
(See accompanying notes)
5<PAGE>
First Mortgage Corporation
Notes to Financial Statements
NOTE #1 - Statement Preparation
- -------------------------------
The Company has prepared the accompanying financial statements with interim
financial reporting requirement promulgated by the Securities and Exchange
Commission. The information furnished reflects all adjustments which are,
in the opinion of management, necessary for a fair presentation of
financial position and results of operations.
The consolidated financial statements should be read in conjunction with
the consolidated financial statements and notes thereto included in the
Company's February 28, 1997 10-K report.
6
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
Liquidity and Capital Resources
- --------------------------------
Management believes that proceeds from current mortgage recovery revenues,
interest revenues and cash reserves will provide sufficient capital and
liquidity to meet the Company's needs for the next twelve months.
The general business outlook continues to be unclear for the Company. The
Company's management is convinced it must find a revenue source to replace
the RTC loan packages it has processed in the past few years. Currently,
the Company is purchasing secured "Bridge Loans" for mortgages on real
property. Management believes these mortgage loan receivables will provide
additional revenues for the Company.
During the six month period ending August 31, 1997, the Company collected
$100,070 from mortgage recovery activities and $19,946 from interest
income. Comparable figures for the six months of 1996 are $28,000 from
mortgage recovery income and $8,684 from interest income.
For the three months period ending August 31, 1997, mortgage recovery
revenues were $81,927 and interest earnings were $7,002. Comparable figures
for the three month period of 1996, are $5,000 from mortgage revenues and
$4,374 from interest income. The increase in revenues from the previous
comparable periods are the result of specific loan packages obtained from
the FDIC. The Company expects this trend to continue into the next six
months but not into the next fiscal year.
Results of Operations
- ----------------------
The Company had $112,812 in revenues in the six months period ending August
31, 1997. For the comparable six months of 1996, total revenues were
$38,380.
Commission expense for the six month period ending August 31, 1997, were
$18,000 and $16,200 for the six month period ending August 31, 1996.
Administrative expenses for the six months period ending August 31, 1997,
were $20,614 and for the comparable period of 1996 were $14,357.
Net profit after provisions for income taxes were $57,296 for August 31,
1997, and $6,650 for August 31, 1996.
The Company's management anticipates that revenues will continue at the
current quarter level for the next six months but not beyond the fiscal
year end of February 28, 1998. The basis of this is the collection of the
loans packages producing the revenues will be completed by February 28,
1998.
7
<PAGE>
PART II - OTHER INFORMATION
-----------------------------
Item 1 Legal Proceedings . . . . . . . . . . . . . . . . . . . . None
Item 2 Changes in the Rights of the Company's Security Holders . None
Item 3 Defaults by the Company on its Senior Securities. . . . . .None
Item 4 Results of Votes of Security Holders. . . . . . . . . . . .None
Item 5 Other Information . . . . . . . . . . . . . . . . . . . . .None
Item 6 Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . None
<PAGE>
___________________________________________________________________________
SIGNATURES
___________________________________________________________________________
Pursuant to the requirements of Section 13 or 15(d) 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.
Date:April 3, 1998 By:/S/ William S. Greaves
----------------------- -----------------------------------
April 3, 1998 William S. Greaves,
(President)
(Principal Executive Officer)
Date:April 3, 1998 By:/S/ William S. Greaves
----------------------- -----------------------------------
April 3, 1998 William S. Greaves,
(Principal Financial &
Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000036548
<NAME> FIRST MORTGAGE CORP
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> FEB-28-1997
<PERIOD-END> AUG-30-1997
<CASH> 576,109
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 50,865
<DEPRECIATION> 0
<TOTAL-ASSETS> 626,974
<CURRENT-LIABILITIES> 16,102
<BONDS> 0
0
0
<COMMON> 51,102
<OTHER-SE> 559,770
<TOTAL-LIABILITY-AND-EQUITY> 626,974
<SALES> 0
<TOTAL-REVENUES> 112,812
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 39,414
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 73,398
<INCOME-TAX> 16,102
<INCOME-CONTINUING> 57,296
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 57,296
<EPS-PRIMARY> .001
<EPS-DILUTED> 0
</TABLE>
