UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[ X ] Quarterly Report under Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended September 30, 1996
[ ] Transition Report under Section 13 or 15(d) of the Securities
Exchange Act of 1934 (no fee required)
For the transition period from ________________ to ________________
Commission file number: 0-5370
GENERAL RESIDENTIAL CORPORATION
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(Exact name of small business issuer as specified in its charter)
Delaware 95-2679815
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(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
17992 Darmel Place, Santa Ana, California 92705
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(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: (714) 633-4275
Common Stock, $.01 par value
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(Title of Class)
Check whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the 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. Yes [ X ] No [ ]
As of September 30, 1996, the Company had 16,521,788 shares of common
stock issued and outstanding.
Transitional Small Business Disclosure Format: Yes [ ] No [ X ]
Total sequentially numbered pages in this document: 8.
page 1 of 8
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
GENERAL RESIDENTIAL CORPORATION
CONDENSED BALANCE SHEETS (UNAUDITED)
September 30, December 31,
1996 1995
------------ ------------
ASSETS
CASH $ 4,209 $ 10,118
PROPERTY AND EQUIPMENT,
net of accumulated depreciation 1,926,430 1,999,213
------------ ------------
$ 1,930,639 $ 2,009,331
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Notes payable, secured by deeds of trust $ 45,163 $ 138,941
Accounts payable and accrued expenses 6,350 6,350
Income taxes payable 7,155 13,118
Deferred income taxes 486,000 504,000
Due to related parties 148,500 135,000
------------ ------------
TOTAL LIABILITIES 693,168 797,409
------------ ------------
STOCKHOLDERS' EQUITY (Note 2)
Common stock, $.01 par value;
authorized - 50,000,000 shares;
issued and outstanding -
16,521,788 shares at September 30, 1996
and 16,549,501 shares at December 31, 1995 165,218 165,495
Additional paid-in capital 1,333,007 1,334,393
Accumulated deficit (260,754) (287,966)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 1,237,471 1,211,922
------------ ------------
$ 1,930,639 $ 2,009,331
============ ============
page 2 of 8
GENERAL RESIDENTIAL CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended September 30, 1996 and 1995
1996 1995
------------ ------------
LEASING REVENUES $ 90,681 $ 90,639
------------ ------------
COSTS AND EXPENSES
Compensation to officers and directors 42,000 28,500
General and administrative expenses 8,959 12,074
Depreciation 24,261 24,261
Interest expense, including $3,960 in 1996
and $3,713 in 1995 to related parties 5,394 8,568
------------ ------------
80,614 73,403
------------ ------------
Income before income taxes 10,067 17,236
Income taxes 2,900 5,505
------------ ------------
Net income $ 7,167 $ 11,731
============ ============
Net income per common share $ -- $ --
============ ============
Weighted average number of shares of
common stock 16,522,000 16,557,000
============ ============
page 3 of 8
GENERAL RESIDENTIAL CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
Nine Months Ended September 30, 1996 and 1995
1996 1995
------------ ------------
LEASING REVENUES $ 272,057 $ 271,917
------------ ------------
COSTS AND EXPENSES
Compensation to officers and directors 112,500 85,500
General and administrative expenses 30,761 31,887
Depreciation 72,783 72,783
Interest expense, including $11,468 in 1996
and $11,138 in 1995 to related parties 17,701 27,405
------------ ------------
233,745 217,575
------------ ------------
Income before income taxes 38,312 54,342
Income taxes 11,100 13,359
------------ ------------
Net income $ 27,212 $ 40,983
============ ============
Net income per common share $ -- $ --
============ ============
Weighted average number of shares of
common stock 16,531,000 16,625,000
============ ============
page 4 of 8
GENERAL RESIDENTIAL CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Nine Months Ended September 30, 1996 and 1995
1996 1995
------------ ------------
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from lessees $ 272,057 $ 271,917
Interest paid to related parties (11,468) (11,138)
Interest paid to others (6,233) (16,267)
Income taxes paid (35,063) (18,182)
Cash paid to officers and directors
for fees and expenses (99,000) (85,500)
General and administrative expenses (30,761) (31,887)
------------ ------------
NET CASH PROVIDED BY OPERATING
ACTIVITIES 89,532 108,943
------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments on notes payable,
secured by deeds of trust (93,778) (101,594)
Common stock repurchased and retired (1,663) (7,048)
------------ ------------
NET CASH USED IN FINANCING ACTIVITIES (95,441) (108,642)
------------ ------------
NET INCREASE (DECREASE) IN CASH (5,909) 301
CASH BALANCE AT BEGINNING OF PERIOD 10,118 8,158
------------ ------------
CASH BALANCE AT END OF PERIOD $ 4,209 $ 8,459
============ ============
RECONCILIATION OF NET INCOME TO
NET CASH PROVIDED BY OPERATING ACTIVITIES
Net income $ 27,212 $ 40,983
Adjustments to reconcile net income
to net cash provided by operating activities:
Accrual of officers' fees and expenses 13,500
Depreciation of property and equipment 72,783 72,783
Increase in income taxes payable and
deferred taxes (23,963) (4,823)
------------ ------------
NET CASH PROVIDED BY OPERATING
ACTIVITIES $ 89,532 $ 108,943
============ ============
page 5 of 8
GENERAL RESIDENTIAL CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
1. COMMENTS
The accompanying condensed financial statements are unaudited but, in the
opinion of the management of the Company, contain all adjustments
necessary to present fairly the financial position at September 30, 1996,
the results of operations for the three months and nine months ended
September 30, 1996 and 1995, and the changes in cash flows for the nine
months ended September 30, 1996 and 1995. These adjustments are of a
normal recurring nature. The balance sheet as of December 31, 1995 is
derived from the Company's audited financial statements. Certain
information and footnote disclosures normally included in financial
statements that have been prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the
rules and regulations of the Securities and Exchange Commission, although
management of the Company believes that the disclosures in these
financial statements are adequate to make the information presented
therein not misleading. For further information, refer to the financial
statements and notes thereto included in the Company's Annual Report on
Form 10-KSB for the fiscal year ended December 31, 1995, as filed with
the Securities and Exchange Commission.
The results of operations for the three months and nine months ended
September 30, 1996, are not necessarily indicative of the results of
operations to be expected for the full fiscal year ending December 31,
1996.
2. PURCHASE AND RETIREMENT OF COMMON STOCK
During the nine months ended September 30, 1996, the Company purchased
and retired 27,713 shares of its common stock for an aggregate cash
payment of $1,663.
page 6 of 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
OR PLAN OF OPERATION
Financial Condition:
The Company expects to generate sufficient cash flow from operations to
fund operating expenses and scheduled debt service requirements during
the fiscal year ending December 31, 1996.
Results of Operations:
The Company leases its three properties to an unrelated entity which
operates the properties as residential board and care facilities. The
Company has a fixed yearly lease income of approximately $360,000 through
April 2005. The Company has no other sources of operating revenues.
PART II. OTHER INFORMATION
Items 1 through 6 are not applicable.
page 7 of 8
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
GENERAL RESIDENTIAL CORPORATION
-------------------------------------
(Registrant)
/s/ Paul M. Kuefler
Date: November 6, 1996 By: ____________________________________
Paul M. Kuefler
President
(Principal Executive Officer)
/s/ Daniel Lezak
Date: November 6, 1996 By: ____________________________________
Daniel Lezak
Secretary - Treasurer and
Chief Financial Officer
(Principal Financial and
Accounting Officer)
page 8 of 8
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<ARTICLE> 5
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 4,209
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 1,926,430
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,930,639
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 165,218
0
0
<OTHER-SE> 1,072,253
<TOTAL-LIABILITY-AND-EQUITY> 1,930,639
<SALES> 0
<TOTAL-REVENUES> 272,057
<CGS> 0
<TOTAL-COSTS> 233,745
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 38,312
<INCOME-TAX> 11,100
<INCOME-CONTINUING> 27,212
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 27,212
<EPS-PRIMARY> 0
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</TABLE>
