SECURITIES & EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Annual Report Pursuant to Section 13 or 15 (d)
of the Securities Exchange Act of 1934
For the Quarter Ended Commission File No.
April 30, 1997 0-5304
CUSTOMER SPORTS, INC.
UTAH 87-0282745
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
455 Marine View Avenue, Suite 260, Del Mar, California 92014
(Address of Principal Executive Offices)
Registrant's telephone number including area code:(619) 793-2233
Former name, former address, and former fiscal INCORP, INC.
year end, if changed since last report. 11339 Sorrento Valley Road, Suite C,
San Diego, California 92121
Indicate by checkmark 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 in the past 90 days:
Yes X No
------------ ------------
Indicate the number of shares outstanding for each of the issuer's classes
of Common Stock as of the last practical date:
Common Stock, Par Value $.01 Per Share, 11,424,996 Shares Outstanding at
April 30, 1997. <PAGE>
CUSTOMER SPORTS, INC.
TABLE OF CONTENTS
PART I FINANCIAL STATEMENTS
ITEM 1. FINANCIAL STATEMENTS (Unaudited)
Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . .3
Statement of Operations. . . . . . . . . . . . . . . . . . . . .4
Statement of Cash Flows. . . . . . . . . . . . . . . . . . . . .5
Note to Financial Statements . . . . . . . . . . . . . . . . . .6
ITEM 2 MANAGEMENT DISCUSSION AND FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
PART II OTHER INFORMATION. . . . . . . . . . . . . . . . . . . . . . . .7
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . .8
<PAGE>
Customer Sports, Inc.
(Formerly Incorp, Inc.)
Balance Sheets
April 30, 1997 & July 31, 1996
<TABLE>
<CAPTION>
1997 1996
------------ ------------
<S> <C> <C>
ASSETS
Current Assets
- --------------
Cash $ 8,476 $ 3,248
Receivable Note #3 2,285 3,048
Inventory 4,647 500
------------ ------------
Total Current Assets 15,408 6,796
Other Assets
- ------------
Refundable Deposit 6,000 3,000
Equipment - Net 5,928 6,151
Oil & Gas Properties
(Successful Efforts Method) 857,901 932,901
(Notes #1 & #8) (692,765) (673,505)
------------ ------------
Total Other Assets 177,064 268,547
------------ ------------
TOTAL ASSETS $ 192,472 $ 275,343
============ ============
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities
- -------------------
Accounts Payable & Accrued Expenses $ 79,730 $ 320,752
Notes Payable (Note #5) 74,627 176,522
------------ ------------
Total Current Liabilities 154,357 497,274
Long Term Liabilities
- ---------------------
Notes Payable (Note #5) 309,263 32,105
Stockholders' Equity
- --------------------
Capital Stock, 50,000,000 Shares
at $0.001 Par Value; 11,424,996
& 10,390,996 Shares Issued &
Outstanding 114,250 103,910
Paid In Capital 6,382,227 6,272,197
Deficit in Retained Earnings (6,767,625) (6,630,143)
------------ ------------
Total Stockholders' Equity (271,148) (254,036)
------------ ------------
TOTAL LIABILITIES &
STOCKHOLDERS' EQUITY $ 192,472 $ 275,343
============ ============
</TABLE>
3<PAGE>
Customer Sports, Inc.
(Formerly Incorp, Inc.)
Statements of Operations (Unaudited)
For the Three Months Period Ended April 30, 1997 & 1996
& the Nine Months Ended April 30, 1997 & 1996
<TABLE>
<CAPTION>
For the Three For the Nine
Months Ended Months Ended
April April April April
1997 1996 1997 1996
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues
- --------
Golf Sales & Fees $ (4,223) $ 6,967 $ 23,770 $ 6,967
------------ ------------ ------------ ------------
Total Revenues (4,223) 6,967 23,770 6,967
Cost of Expenses
- ----------------
Cost of Golf Sales (739) -0- 13,223 -0-
------------ ------------ ------------ ------------
Gross Profit (3,484) 6,967 10,547 6,967
Operating Expenses
- ------------------
General & Administrative
Expenses 99,441 105,693 265,915 256,658
Depreciation &
Amortization 9,727 5,511 19,770 19,330
Prior Years Adjustment (182,133) -0- (182,133) -0-
------------ ------------ ------------ ------------
Total Cost & Expenses (72,965) 111,204 103,552 275,988
------------ ------------ ------------ ------------
Profit or (Loss)
from Operations 69,481 (104,237) (93,005) (269,021)
- ---------------
Other Income (Expenses)
- -----------------------
Oil & Gas Revenues 16,302 9,126 33,355 26,793
Lease Operating Expenses
Delayed Rentals,
Royalties,& Taxes -
Oil Well (3,625) (5,561) (9,333) (15,892)
Oil Well Improvement (25,000) -0- (75,000) -0-
Gain on Sale of Asset 6,500 -0- 6,500 -0-
------------ ------------ ------------ ------------
Total Other Income
(Loss) (5,823) 3,565 (44,478) 10,901
------------ ------------ ------------ ------------
Net Loss $ 63,658 $ (100,672) $ (137,483) $ (258,120)
============ ============ ============ ============
Net Loss Per Share
of Common Stock $ .01 $ (.01) $ (.01) $ (.03)
Weighted Average
Number Of Shares
Outstanding
During Period 11,424,996 8,303,496 11,424,996 8,303,496
</TABLE>
4
<PAGE>
Customer Sports, Inc.
(Formerly Incorp, Inc.)
Statement of Cash Flows (Unaudited)
April 30, 1997 & 1996
<TABLE>
<CAPTION>
1997 1996
------------ ------------
<S> <C> <C>
Cash Flows from Operating Expenses
- ----------------------------------
Net (Loss) from Operations $ (137,483) $ (258,118)
Adjustments to Reconcile Net Loss to
Net Cash Provided by Operating Activities
Write Off Oil Wells 75,000 -0-
Depletion 19,770 19,330
Non Cash Expenses 370 62,250
Adjustment of Prior Year Accounts Payable (182,133) -0-
Changes in Operating Assets & Liabilities
(Increase) Decrease in Inventory (4,147) -0-
(Increase) Decrease in Accounts Receivable 763 5,304
(Increase) Decrease in Refundable Deposits (3,000) (3,000)
Increase (Decrease) in Accounts Payable 23,261 108,515
------------ ------------
Net Cash Provided (Used) by
Operating Expenses (207,599) (65,719)
Cash Flows from Investing Activities
- ------------------------------------
Purchase of Equipment (1,036) (5,097)
Proceeds from Sale of Wells Rights 750 -0-
------------ ------------
Net Cash Provided (Used) by
Investing Activities (286) (5,097)
Cash Flows from Financing Activities
- ------------------------------------
Sale of Common Shares 105,000 -0-
Payment on Notes Payable -0- (12,022)
Increase in Notes Payable 108,113 90,000
------------ ------------
Net Cash Provided (Used) by
Financing Activities 213,113 77,978
------------ ------------
Increase (Decrease) in Cash 5,228 7,162
Cash at Beginning of Period 3,248 1,515
------------ ------------
Cash at End of Period $ 8,476 $ 8,677
============ ============
</TABLE>
5<PAGE>
Customer Sports, Inc.
(Formerly Incorp, Inc.)
Note to Financial Statements (Unaudited)
ITEM I
NOTE #1 - Basis of Presentation
- -------------------------------
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01
of Regulation S-X. Accordingly, they do not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements. In the opinion of management, adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the three and nine
month periods ending April 30, 1997 are not necessarily indicative of
the results that may be expected for the year ended July 31, 1997. For further
information, refer to the financial statements and footnotes thereto included
in the Company's annual report on Form 10-K for the year ended July 31, 1996.
ITEM II
Management's Discussion and Analysis of Financial Condition and Results
of Operation
Total revenues from golf related sales for the three months ended April 30,
1997, were a negative ($4,223) compared to sales of $6,967 for the comparative
period ended April 30, 1996. The negative sales figure in the April 30, 1997,
quarter are a result of refunds on distribution fees recorded as sales in the
two previous quarters.
Total revenues from golf related sales for the nine months ended April
30, 1997, were $23,770 compared to $6,967 for the nine month period ended
April 30, 1996.
In the quarter ended April 30, 1997, officers of the Company converted
$50,600 of accrued consulting fees to a note payable and forgave accrued
consulting fees from the previous year of $145,850. The Company also
negotiated a forgiveness of prior period accruals of $36,283 from four
creditors.
The Company continues to seek new capital investment to provide
operating capital.
<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 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.
CUSTOMER SPORTS, INC. (Registrant)
Date: August 11, 1997 By: /S/ Edmund J. Irvine
---------------- ------------------------
August 11, 1997 Edmund J. Irvine, Jr.
President
Date: August 11, 1997 By: /S/ S. Michael Sharp
--------------- ------------------------
August 11, 1997 S. Michael Sharp
Secretary
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUL-31-1997
<PERIOD-START> FEB-01-1997
<PERIOD-END> APR-30-1997
<CASH> 8,476
<SECURITIES> 0
<RECEIVABLES> 2,285
<ALLOWANCES> 0
<INVENTORY> 4,647
<CURRENT-ASSETS> 0
<PP&E> 869,747
<DEPRECIATION> (698,410)
<TOTAL-ASSETS> 192,472
<CURRENT-LIABILITIES> 154,347
<BONDS> 0
<COMMON> 114,250
0
0
<OTHER-SE> (385,398)
<TOTAL-LIABILITY-AND-EQUITY> 192,472
<SALES> 4,223
<TOTAL-REVENUES> 20,525
<CGS> (739)
<TOTAL-COSTS> 0
<OTHER-EXPENSES> (72,965)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 63,658
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 63,658
<EPS-PRIMARY> .01
<EPS-DILUTED> 0
</TABLE>
