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 November 30, 1998
------------------
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 87-03202209
- ------------------------------------------- --------------------
(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
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(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 1, 1999.
- --------------
51,101,680 Common Stock (Par Value $.001)
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First Mortgage Corporation
Form 10-Q
Nine Months Ended November 30, 1998
<TABLE>
<CAPTION>
INDEX
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Page
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<S> <C>
PART I Financial Information
ITEM 1 Financial Statements
Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Statements of Operations . . . . . . . . . . . . . . . . . . . . . . . . 6
Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . 7
Notes to Financial Statements. . . . . . . . . . . . . . . . . . . . . . 8
Management's Discussion and Analysis of
the Statement of Income. . . . . . . . . . . . . . . . . . . . . . . . . 9
PART II Other Information
ITEM 1 Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . .10
ITEM 2 Changes in Securities . . . . . . . . . . . . . . . . . . . . . . .10
ITEM 3 Defaults upon Senior Securities. . . . . . . . . . . . . . . . . . 10
ITEM 4 Submission of Matters to a Vote of Security Holders . . . . . . . .10
ITEM 5 Other Information. . . . . . . . . . . . . . . . . . . . . . . . . 10
ITEM 6 Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . 10
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
</TABLE>
First Mortgage Corporation
Financial Statements
November 30, 1998
&
February 28, 1998
First Mortgage Corporation
Balance Sheets
November 30, 1998 and February 28, 1998
<TABLE>
(Unaudited)
November February
30, 1998 28, 1998
------------ ------------
<S> <C> <C>
Assets
Current Assets
- --------------
Cash in Bank $ 53,719 $ 198,335
Cash in Savings 100,000 100,000
Other Receivables -0- 9,509
Contracts Receivable 15,000 15,000
Notes Receivable 596,500 339,000
------------ ------------
Total Current Assets 765,219 661,844
Fixed Assets
- ------------
Office Equipment 1,960 2,261
Leasehold Improvements 365 470
------------ ------------
Total Fixed Assets 2,325 2,731
Other Assets
- ------------
Certificate of Deposit 200,000 200,000
Land 47,968 47,968
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Total Other Assets 247,968 247,968
------------ ------------
Total Assets $ 1,015,512 $ 912,543
============ ============
</TABLE>
See Accompanying Notes
4
First Mortgage Corporation
Balance Sheets -Continued-
November 30, 1998 & February 28, 1998
<TABLE>
<CAPTION>
(Unaudited)
November February
30, 1998 28, 1998
------------ ------------
<S> <C> <C>
Liabilities And Stockholders' Equity
Current Liabilities
- -------------------
Accounts Payable $ -0- $ 883
Taxes Payable 80,864 124,673
------------ ------------
Total Current Liabilities 80,864 125,556
Stockholders' Equity
- --------------------
Common Stock, 100,000,000
Shares Authorized at $0.001 Par Value;
51,101,680 Shares Issued & Outstanding 51,102 51,102
Capital in Excess of Par Value 242,697 242,697
Retained Earnings 640,849 493,188
------------ ------------
Total Stockholders' Equity 934,648 786,987
------------ ------------
Total Liabilities &
Stockholders' Equity $ 1,015,512 $ 912,543
============ ============
</TABLE>
See Accompanying Notes
5
First Mortgage Corporation
Statements of Operations -Unaudited-
For the Nine Months Period Ended November 30, 1998 & 1997
and the Three Months Period Ended November 30, 1998 & 1997
<TABLE>
<CAPTION>
For the Nine Months For the Three Months
Periods Ended Periods Ended
November November November November
30, 1998 30, 1997 30, 1998 30, 1997
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Revenues
- --------
Mortgage Recovery $ 333,000 $ 245,069 $ 20,000 $ 144,999
Interest 69,257 17,575 26,146 5,629
Bad Debt Recovery 3,839 1,419 2,371 623
---------- ---------- ---------- ----------
Total Revenues 406,096 264,063 48,517 151,251
Expenses
- --------
Commission Expense 150,200 69,600 16,000 50,800
Office Expense 7,655 4,267 2,547 1,331
Rent 7,250 6,525 2,900 2,175
Professional Fees 5,241 4,080 -0- -0-
Telephone 2,125 1,673 544 648
Depreciation 405 575 135 203
Land Expense -0- 249 -0- -0-
Travel 2,610 8,928 2,308 1,727
Taxes 15,830 792 -0- 393
---------- ---------- ---------- ----------
Total Expenses 191,316 96,689 24,434 57,277
---------- ---------- ---------- ----------
Net Profit Before Taxes 214,780 167,374 24,080 93,974
Income Taxes 67,119 53,631 9,391 23,303
---------- ---------- ---------- ----------
Net Profit After Taxes $ 147,661 $ 113,743 $ 14,689 $ 70,671
========== ========== ========== ==========
Earnings Per Share $ .003 $ .002 $ .000 $ .001
Weighted Average
Shares Outstanding 51,101,680 51,101,680 51,101,680 51,101,680
</TABLE>
See Accompanying Notes
6
First Mortgage Corporation
Statements of Cash Flows
For the Nine Months Periods Ended November 30, 1998 & 1997
<TABLE>
<CAPTION>
(Unaudited) (Unaudited)
1998 1997
------------ ------------
<S> <C> <C>
Cash Flows from Operating Activities
- ------------------------------------
Net Income $ 147,661 $ 113,743
Adjustments to Reconcile Net Income
to Operating Activities:
Depreciation 405 575
Changes in Operating Assets & Liabilities:
Decrease in Other Receivables 9,509 -0-
Decrease in Prepaid Taxes -0- 4,742
(Decrease) Increase in Other Receivables -0- ( 125,000)
Increase in Accounts Payable ( 883) -0-
Increase (Decrease) in Taxes Payable ( 43,809) 53,631
Rounding 1 ( 1)
------------ ------------
Net Cash Provided by
Operating Activities 112,884 47,690
Cash Flows from Investing Activities
- ------------------------------------
Increase in Contracts ( 290,000) -0-
Purchase of Equipment -0- ( 2,658)
Purchase of Land -0- ( 4,328)
Collected on Contracts 32,500 34,430
------------ ------------
Net Cash Provided by
Investing Activities ( 257,500) 27,444
Cash Flows from Financing Activities
- ------------------------------------
Net Cash Provided by
Financing Activities -0- -0-
------------ ------------
Increase (Decrease) in Cash ( 144,616) 75,134
Cash at Beginning of Year $ 298,335 $ 470,153
------------ ------------
Cash at End of Year $ 153,719 $ 545,287
============ ============
Expense Disclosures
- -------------------
Interest $ -0- $ -0-
Taxes 67,119 53,631
</TABLE>
See Accompanying Notes
7
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, 1998 10-K report.
8
MANAGEMENT'S DISCUSSION AND ANALYSIS
Liquidity and Capital Resources
- -------------------------------
Management believes that proceeds from current revenues from interest and
cash reserves will provide sufficient capital to meet the Company's needs for
the next twelve months.
Management believes that its prime source of funds will be interest earned
from the trust deed notes receivable.
Results of Operations
- ---------------------
During the nine month period ending November 30, 1998, the Company collected
$333,000 from mortgage recovery activities and $69,257 from interest income.
Comparable figures for the nine months of 1997 are $245,069 from mortgage
recovery income and $17,575 from interest income.
For the three months period ending November 30, 1998, mortgage recovery
revenues were $20,000 and interest earnings were $26,146. Comparable figures
for the three months period of 1997 are $144,999 from mortgage revenues and
$5,629 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 for the next three months,
but not into the next fiscal year.
The Company had $406,096 in revenues in the nine months period ending
November 30, 1998. For the comparable nine months period ending November 30,
1997, total revenues were $264,096.
Commissions expense for the nine months period ending November 30, 1998, were
$150,200 and $69,000 for the nine months period of 1997.
Administrative expenses for the nine months period ending November 30, 1998,
were $41,116 and for the comparable period of 1997 were $27,000.
Net profit after provisions for income taxes were $147,661 for November 30,
1998, and $113,743 for November 30, 1997.
The Company's management anticipates that revenues for the next fiscal year
will be limited to interest earned on mortgage contracts. The collection of
loan packages from FDIC and RTC is largely completed at February 28, 1999.
9
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
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.
August 1, 1999 /S/ William S. Greaves
Date:--------------- By:--------------------------------
August 1, 1999 William S. Greaves, President
(Principal Executive Officer)
(Principal Financial & Accounting Officer)
11
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000036548
<NAME> FIRST MORTGAGE CORP
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> FEB-28-1998
<PERIOD-START> SEP-01-1998
<PERIOD-END> NOV-30-1998
<CASH> 153,719
<SECURITIES> 0
<RECEIVABLES> 611,500
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 765,219
<PP&E> 6,738
<DEPRECIATION> 4,412
<TOTAL-ASSETS> 1,015,512
<CURRENT-LIABILITIES> 80,864
<BONDS> 0
0
0
<COMMON> 51,102
<OTHER-SE> 883,546
<TOTAL-LIABILITY-AND-EQUITY> 1,015,512
<SALES> 0
<TOTAL-REVENUES> 406,096
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 191,316
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 214,780
<INCOME-TAX> 67,119
<INCOME-CONTINUING> 147,661
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 147661
<EPS-BASIC> .03
<EPS-DILUTED> 0
</TABLE>
