U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark one)
[X] QUARTERLY REPORT PURSUANT SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended SEPTEMBER 30, 1999
OR
[ ] TRANSITION REPORT PURSUANT SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ___________________ to ___________________
Commission file number 2-78335-NY
J R CONSULTING, INC.
--------------------
(Exact name of small business issuer in its charter)
NEVADA 13-3121128
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
180 VARICK STREET, 13TH FLOOR, NEW YORK, NEW YORK 10014
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(Address of principal executive offices)
(212) 807-6994
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(Issuer's telephone number)
N/A
---
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act of 1934 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 [ ]
The number of shares outstanding of the issuer's Common Stock, $.04 par
value per share, as of December 20, 1999, is 13,373,257.
Transitional Small Business Disclosure Format (check one):
YES [ ] NO [X]
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED FINANCIAL INFORMATION
JR CONSULTING, INC.
CONSOLIDATED CONDENSED BALANCE SHEET
9/30/99 6/30/99
ASSETS (UNAUDITED) (AUDITED)
----------- ---------
$ '000 $ '000
Current assets
Cash $ 1 $ 1
Accounts receivable 1,168 1,202
Other current assets 55 152
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Total current assets 1,224 1,355
Property, plant and equipment, net of accumulated
depreciation of $119,000 and $97,000 at
September 30, 1999 and June 30, 1999,
respectively 366 349
Other assets
Goodwill and patents 547 559
Other assets 40 43
------ ------
Total other assets 587 602
Total Assets $2,177 $2,306
====== ======
LIABILITIES
Current liabilities
Overdraft 265 183
Accounts payable 638 793
Accrued liabilities 405 335
Other current liabilities 1,194 1,280
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Total current liabilities 2,502 2,591
Other liabilities
Debt payable after 12 months 529 520
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Total Liabilities 3,031 3,111
PREFERRED STOCK OF SUBSIDIARY 1,150 1,150
2
<PAGE>
STOCKHOLDERS' DEFICIENCY
Common stock 535 535
Less 5,187,598 shares issued at discount
below par value (154) (154)
Paid in capital in excess of par value 2,857 2,857
Retained earnings (5,243) (5,260)
Comprehensive income 1 67
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Total Stockholders' Deficiency (2,004) (1,955)
------- -------
$ 2,177 $ 2,306
======= =======
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE CONSOLIDATED FINANCIAL
STATEMENTS.
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<PAGE>
CONSOLIDATED FINANCIAL INFORMATION
JR CONSULTING, INC.
CONSOLIDATED CONDENSED STATEMENT OF INCOME
THREE MONTHS ENDED
9/30/99 9/30/98
(UNAUDITED) (UNAUDITED)
----------- -----------
$'000 $'000
REVENUE
Products and services $ 591 $ 385
----------- -----------
Total Revenue 591 385
EXPENSES
SG&A expenses 628 545
Amortization of goodwill and patents 12 12
Interest expense 1 --
Other expense -- 1
----------- -----------
Total Expenses 641 558
Loss from Continuing Operations (50) (173)
Loss from Discontinued Operations -- (50)
----------- -----------
Pre-tax profit (loss) (50) (223)
Income tax expenses -- --
----------- -----------
Net Loss $ (50) $(223)
=========== ===========
Weighted average number of
common shares outstanding 13,373,257 13,373,257
Net loss per share of common stock ($0.00) ($0.02)
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF CONSOLIDATED FINANCIAL
STATEMENTS.
4
<PAGE>
CONSOLIDATED FINANCIAL INFORMATION
JR CONSULTING, INC.
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
THREE MONTHS ENDED
9/30/99 9/30/98
(UNAUDITED) (UNAUDITED)
----------- -----------
$'000 $'000
Operating activities
Net income (loss) $ (50) $(223)
Depreciation and amortization 34 33
Decrease in inventory -- 1
Change in other net operating assets (37) 62
Other 92 138
----------- -----------
Net cash provided by (used in)
operating activities 39 11
Investing activities
Capital expenditures (39) (48)
----------- -----------
Net cash provided by (used in)
investing activities (39) (48)
Financing activities -- --
----------- -----------
Net cash provided by (used in)
financing activities 0 0
----------- -----------
Increase in cash 0 (37)
Cash at July 1 1 41
Cash at September 30 1 4
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THE CONSOLIDATED FINANCIAL
STATEMENTS.
5
<PAGE>
J R CONSULTING, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
NOTE 1
The accompanying unaudited consolidated condensed financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB. 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, all adjustments considered necessary for a fair presentation have
been included, and such adjustments are of a normal recurring nature. Results
for interim periods should not be considered indicative of results for any other
interim period or for future years.
NOTE 2
No income taxes were paid during the three months ended September 30, 1999.
NOTE 3
The effects of non-cash investing and financing activities have been excluded
from the statement of cash flows in accordance with SFAS 95.
6
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
JR Consulting, Inc. (the "Company") incurred a loss from continuing
operations of $50,000 for the quarter ended September 30, 1999, compared with a
loss from continuing operations of $173,000 for the quarter ended September 30,
1998. This improvement is due to the sales of services from continuing
operations having increased by over 50% from $385,000 for the quarter ended
September 30, 1998 to $591,000 for the quarter ended September 30, 1999. In
contrast, the SG&A expenses only increased by 15% from $545,000 for quarter
ended September 30, 1998 to $628,000 for quarter ended September 30, 1999.
There were no other significant items of income or expense from
continuing operations during either the quarter ended September 30, 1998 or
September 30, 1999 that impacted upon the performance of the Company. However,
the discontinued operations of Benatone incurred a loss of $50,000 in the
quarter ended September 30, 1998. The impact of this loss further reduced the
net performance of the Company for the quarter ended September 30, 1998 to a net
loss of $223,000 compared to the performance of the Company for the quarter
ended September 30, 1999 with a net loss of $50,000.
The operating performance of Prima Eastwest Model Management, Inc.
("Prima") in the quarter ended September 30, 1999, showed a significant decline
from the corresponding period in the previous year (a loss of $28,000 compared
with a profit of $23,000). The sales were approximately 11% higher, increasing
from $224,000 in the quarter ended September 30, 1998 to $249,000 in the quarter
ended September 30, 1999. This was below the sales levels achieved in the same
quarter for previous years confirming that there remains considerable room for
improvement. At the same time, SG&A expenses increased by approximately 37%.
These expenses increased from $188,000 in the quarter ended September 30, 1998
to $258,000 in the quarter ended September 30, 1999. Although these higher
expenses are partly due to the new and more expensive rented office, management
is reviewing the expenses to ensure that they do not continue to increase at
levels so much above inflation without a corresponding increase in productivity
and sales.
Management forecast losses at Que for the first years of operations.
However, the results of Que were better than forecast and management believes
that many of the initial expenses will not be repeated. Furthermore, Que has
already begun working and co-operating closely with Prima to the benefit of both
companies. This enabled the Company to make a profit on its Que operations for
the quarter ended September 30, 1999. Management believes that, with continued
expansion, Que should be profitable for the fiscal year ending June 30, 2000
although there is no assurance that this will happen or that, if it does, the
Company as a whole will be profitable as a result. In the quarter ended
September 30, 1999, Que had sales of $342,000 compared with $161,000 for the
fiscal quarter ended September 30, 1998, which is an increase of approximately
111%. At the same time SG&A expenses only increased by approximately 5% from
$254,000 for the quarter ended September 30, 1998 to $268,000 for the quarter
ended September 30, 1999. The operating performance changed from a loss of
$107,000 for the fiscal quarter ended September 30, 1998 to a profit of $59,000
for the fiscal quarter ended September 30, 1999.
7
<PAGE>
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
A. Exhibits
27.1 - Financial Data Schedule
B. Form 8-K
On August 9, 1999, the Company filed a Current Report on Form 8-K
dated April 28, 1999 in connection with the reorganization with Quasar Projects
Company, a Delaware corporation now known as Diva Entertainment, Inc.
("Diva-Delware"), pursuant to which (a) the Company became the controlling
shareholder of Diva-Delaware, and (b) the Company's 95.3%-owned subsidiary, Diva
Entertainment, Inc., a Florida corporation ("Diva-Florida"), became a
wholly-owned subsidiary of Diva-Delaware.
8
<PAGE>
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.
J R CONSULTING, INC.
Date: January 10, 2000 By: /S/ PETER C. ZACHARIOU
----------------------------------
Peter C. Zachariou, President
9
<PAGE>
EXHIBIT INDEX
EXHIBIT DESCRIPTION
27.1 Financial Data Schedule
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<ARTICLE> 5
<MULTIPLIER> 1000
<CURRENCY> 0
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-2000
<PERIOD-START> JUL-01-1999
<PERIOD-END> SEP-30-1999
<EXCHANGE-RATE> 1
<CASH> 1
<SECURITIES> 0
<RECEIVABLES> 1,168
<ALLOWANCES> 158
<INVENTORY> 0
<CURRENT-ASSETS> 1,224
<PP&E> 485
<DEPRECIATION> 119
<TOTAL-ASSETS> 2,177
<CURRENT-LIABILITIES> 2,502
<BONDS> 0
0
1,150
<COMMON> 535
<OTHER-SE> (2,539)
<TOTAL-LIABILITY-AND-EQUITY> 2,177
<SALES> 591
<TOTAL-REVENUES> 591
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 640
<LOSS-PROVISION> 158
<INTEREST-EXPENSE> 1
<INCOME-PRETAX> (50)
<INCOME-TAX> 0
<INCOME-CONTINUING> (50)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (50)
<EPS-BASIC> (0)
<EPS-DILUTED> (0)
</TABLE>
