Form 10Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Quarterly Report Under Section 13 or 15 (d)
of the Securities Exchange Act of 1934
For Quarter Ended: Nov. 30, 1998
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Commission File Number: 0-11050
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Mammatech Corporation
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(Exact name of registrant as specified in its charter)
Florida 59-2181303
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
930 N.W. 8th Avenue, Gainesville, Florida 32601
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(Address of principal executive offices) (Zip Code)
(904) 375-0607
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(Registrant's telephone number, including area code)
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 ninety days. Yes No X
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Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:
Number of shares outstanding on
Nov. 30, 1998
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100,352,500 shares of which
6,208,500 are treasury shares
TITLE OF EACH CLASS
- -------------------
Common stock $.0001 par value
The total number of pages of this report is 11.
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Mammatech Corporation
INDEX
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PART I.
FINANCIAL INFORMATION PAGE NO.
Item 1. Financial Statements
Statements of Operations for Three Months
Ended Nov. 30, 1998 and Nov. 30, 1997....................3
Balance Sheets for Nov. 30, 1998 and
August 31, 1998........................................4-5
Statement of Cash Flow for the Quarter
Ended Nov. 30, 1998......................................6
Statement of Cash Flow for the Quarter
Ended Nov. 30, 1998......................................7
Notes to Financial Statements for the Quarter
Ended Nov. 30, 1998......................................8
Item 2. Management's Discussion and Analysis of
Financial Conditions and Results of Operations...........9
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K...............10
SIGNATURES............................................. 11
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Mammatech Corporation
Statements of Operations
(Unaudited)
Three Months Ended
November, 1998 November, 1997
-------------- --------------
Sales, net $ 135,632 $ 175,012
Cost of sales $ 50,564 $ 47,925
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Gross Profit $ 85,068 $ 127,087
Selling, general and
administrative expense $ 109,924 $ 79,906
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Operating Income (Loss) $ (24,856) $ 47,181
Other income
(expense)
Reimbursement (SBIR Grant) 57,002 26,307
Interest & Dividend Income 6,811 3,830
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63,813 30,136
Net Income before taxes $ 38,957 77,317
Provision for income taxes 0 0
Net Income 38,957 77,317
NET INCOME (LOSS) 38,957 77,317
============= =============
Net income (loss) per share .0004 .0008
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Weighted average shares 100,352,500 100,352,500
============= =============
The accompanying notes are an integral part of the financial statements.
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Mammatech Corporation
Balance Sheets
Nov. 30, Aug. 31,
1998 1998
(Unaudited) (Audited)
----------- ---------
ASSETS
- ------
Cash and Cash Equivalents $406,677 $342,740
Available for sale:
securities 106,445 94,377
Accounts receivable:
Trade 47,833 74,983
Other 3,190 3,190
Inventory 198,714 201,574
Other current assets
Total Current Assets 762,859 716,864
-------------------- -------- --------
Property and equipment 44,180 43,622
Other assets:
Other investments
Patents, trademarks, and
other intangibles, net of
accumulated amortization
of $66,955 and $64,675
respectively 7,392 8,657
-------- --------
Total other assets 7,392 8,657
------------------ -------- --------
TOTAL ASSETS $814,431 $769,143
======== ========
The accompanying notes are an integral part of the financial statements.
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Mammatech Corporation
Balance Sheets
As of August 31, 1998
and Nov. 30, 1998
(continued)
Nov.1998 Aug. 1998
-------- ---------
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
CURRENT LIABILITIES
- -------------------
Current portion of long term debt $ 4,796 $ 4,796
Accounts payable-trade 44,314 48,595
Customer deposits -0- -0-
Accrued payable-officer 6,630 6,630
Accrued expenses 164,120 163,966
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TOTAL CURRENT LIABILITIES 219,860 223,987
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COMMITMENTS
Long term debt 1,940 1,940
Stockholders' equity:
Common stock, par value $.0001;
200,000,000 shares authorized;
100,352,500 shares issued
and outstanding $ 10,035 $ 10,035
Additional paid-in capital 2,809,594 2,809,594
Accumulated deficit (2,091,016 (2,109,926
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728,613 709,703
Valuation allowance: mkt. sec 12,068 (18,436)
Treasury stock at cost,
6,208,500 shares (148,051) (148,051)
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592,631 543,216
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TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 814,431 $ 769,143
=========== ===========
The accompanying notes are an integral part of these statements.
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Mammatech Corporation
Statement of Cash Flow
For the Three Months Ending
Nov. 30, 1998
Net cash flow from operating activities $ 63,379
========
Investing Activities:
Purchase of fixed assets 558
Financing activities:
Issuance of treasury shares -0-
Net increase (decrease) in cash 63,937
Beginning cash 342,740
--------
Ending cash $406,677
========
The accompanying notes are an integral part of the financial statements.
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Mammatech Corporation
Notes to Financial Statements
Nov. 30, 1998
Note 1. In the opinion of the Company, the accompanying unaudited financial
statements contain all adjustments (consisting of only normal
recurring accruals) necessary to present fairly the financial position
as of Nov. 30, 1998, and the results of operations and changes in
financial position for the three months ended Nov. 30, 1998.
Note 2. Loss per share is based on the weighted average number of shares
outstanding during each period.
Note 3. Gives effect to the Company's repurchasing 7,558,500 shares of stock
from shareholders for treasury stock.
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<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF
OPERATION FOR MAMMATECH CORPORATION
For the first quarter of Fiscal 1999,net sales decreased 23.2% from the previous
quarter and were 22.5% below the first quarter of 1997. Operating costs of
$109,924 decreased of 42% relative to the previous quarter but increased 37.6%
in comparison to the same period last year.Part of the decrease compared to the
fourth quarter of 1998 is the result of accruals charged to that period during
the audit. The net income for the quarter was 49.6% below that of the first
quarter of 1998 but, because of the accruals, cannot be meaningfully compared to
the net income of the previous quarter.
The most significant development of the quarter was the expansion of the
Company's professional training program. Two highly qualified nurses were hired
to replace the previous Director who resigned to pursue other interests. During
the quarter, 16 new MammaCare Specialists were trained compared to seven the
previous quarter. Additionally, a focused marketing program is being developed
to enhance this aspect of the Company's business. Part of this program involves
publicizing the achievements of each new MammaCare Specialist on the Company's
expanded web site.
The Company is presently in the second year of its Phase II SBIR grant under
which MammaCare products are being developed for women with vision or hearing
impairments. Further,in response the repeated demand from existing customers,
selected MammaCare products are now available in Spanish. Of course, there can
be no assurance that significant revenues will result from the sale of any of
these products.
With the exception of a small note to an unaffiliated supplier for a
manufacturing facility, the Company remains debt free and has no immediate
liquidity problems. It continues to seek a relationship with a larger health
care organization.
YEAR 2000 IMPLICATIONS. Many currently installed computer systems and software
products are coded to accept only two-digit entries in the date code field and
cannot reliably distinguish dates beginning on January 1, 2000 from dates prior
to the year 2000. Many companies' software and computer systems may need to be
upgraded or replaced in order to process correctly dates beginning in 2000 and
to comply with the "Year 2000" requirements. The Company has reviewed its
systems and internal programs and has determined that there are no significant
Year 2000 problems exist. None of the Company's products are in any way date
sensitive. However, although the Company believes that its systems are Year 2000
compliant, the equipment and software of its suppliers and subcontractors may
not be Year 2000 compliant. Failure of such third-party equipment or software to
properly process dates for the year 2000 and thereafter could require the
Company to incur unanticipated expenses to remedy any problems, which could have
a materially adverse effect on its business, results of operations and financial
condition.
-8-
<PAGE>
PART II - OTHER INFORMATION
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Item 6. Exhibits and Reports on Form 8-K
(a.) Exhibits - None
(b.) There were no reports filed on Form 8-K during the three
months ending Nov. 30, 1998.
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<PAGE>
10-Q
For the three months ended Nov. 30, 1998
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.
MAMMATECH CORPORATION
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DATE: January 14, 1999 BY: /s/ Henry S. Pennypacker
-----------------------------------
Henry S. Pennypacker, President
and Director
BY: /s/ Mary Sellers
-----------------------------------
Mary Sellers, Treasurer and
Chief Financial Officer
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> AUG-31-1998
<PERIOD-END> NOV-30-1998
<CASH> 406,677
<SECURITIES> 106,445
<RECEIVABLES> 51,023
<ALLOWANCES> 6,350
<INVENTORY> 198,714
<CURRENT-ASSETS> 762,859
<PP&E> 44,180
<DEPRECIATION> 5,000
<TOTAL-ASSETS> 814,431
<CURRENT-LIABILITIES> 219,860
<BONDS> 0
0
0
<COMMON> 10,035
<OTHER-SE> 582,595
<TOTAL-LIABILITY-AND-EQUITY> 814,431
<SALES> 135,632
<TOTAL-REVENUES> 135,632
<CGS> 50,564
<TOTAL-COSTS> 109,924
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 38,957
<INCOME-TAX> 0
<INCOME-CONTINUING> 38,957
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 38,957
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
