UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
- ---- SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1996
OR
TRANSITION REPORT PURSUANT TO SECTION 13 0R 15 (d) OF THE
- ---- SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
------------ ------------
Commission file number: 2-87052-D
---------
Cogenco International, Inc.
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(Exact name of Registrant as specified in its charter)
Colorado 84-0914754
- ------------------------------- ---------------------------
(State or other jurisdiction of (IRS Employer Identification
incorporation or organization) Number)
Suite 1001, 1775 Sherman Street, Denver, Colorado 80203
-------------------------------------------------------
(Address of principal executive offices and Zip Code)
(303)894-0234
-----------------------------
(Registrant's telephone number)
N/A
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(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 of 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: Yes X No
APPLICABLE ONLY TO CORPORATE ISSUERS:
The number of shares outstanding of each of the issuer's classes of common
stock, as of February 12, 1997 is 1,788,756 shares, $.01 par value.
<PAGE>
COGENCO INTERNATIONAL, INC.
(A Development Stage Company)
INDEX
-----
Page No.
--------
PART I. FINANCIAL INFORMATION
Balance Sheet - March 31, 1996 and December 31, 1996
(unaudited) 1
Statement of Operations - For the Three Months Ended
December 31, 1995 and 1996 (unaudited) 2
Statement of Operations - For the Nine Months Ended
December 31, 1995 and 1996 and Cumulative Amounts
From the Inception of the Development Stage (July
26, 1990) through December 31, 1996 (unaudited) 3
Statement of Stockholders' Equity - For the Nine Months
ended December 31, 1996 (unaudited) 4
Statement of Cash Flows - For the Nine Months ended
December 31, 1995 and December 31, 1996 and
Cumulative Amounts from Inception of the Development
Stage(July 26, 1990) through December 31, 1996 (unaudited) 5
Notes to Unaudited Financial Statements 6
Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
PART II. OTHER INFORMATION
<PAGE>
COGENCO INTERNATIONAL, INC.
(A Development Stage Company)
BALANCE SHEET
March 31, 1996 and December 31, 1996
(Unaudited)
<TABLE>
<CAPTION>
ASSETS
March 31, December
1996 31, 1996
---------- ---------
<S> <C> <C>
Current assets:
Cash, including interest bearing
accounts of $141,105 (March 31, 1996)
and $125,761 (December 31, 1996) $ 141,105 $ 125,761
Interest receivable - 1,202
---------- ----------
Total current assets 141,105 126,963
Computer equipment - 3,572
---------- ----------
$ 141,105 $ 130,535
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable - related parties
(Note 3) $ 450 $ 25
Accounts payable - other - 787
---------- ----------
Total current liabilities 450 812
Stockholders' equity:
Preferred stock, $.01 par value;
10,000,000 shares authorized,
no shares issued and outstanding - -
Common stock, $.01 par value;
50,000,000 shares authorized,
1,788,756 shares issued and
outstanding 17,888 17,888
Additional paid-in capital 2,054,400 2,054,400
Accumulated deficit (including
$573,104 deficit accumulated
during the development stage
at December 31, 1996) (1,931,633) (1,942,565)
---------- ----------
Total stockholders' equity 140,655 129,723
---------- ----------
$ 141,105 $ 130,535
========== ==========
See accompanying notes.
1
</TABLE>
<PAGE>
COGENCO INTERNATIONAL, INC.
(A Development Stage Company)
STATEMENT OF OPERATIONS
For the Three Months Ended December 31, 1995 and December 31, 1996
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
December 31,
1995 1996
-------- ------
<S> <C> <C>
Revenues:
Interest Income $ 1,505 $ 1,202
Costs and Expenses:
Legal fees - related party
(Note 3) 1,291 599
Consulting and travel expenses -
related party 10,000 4,227
General and administrative 577 916
--------- ---------
Total costs and expenses 11,868 5,742
--------- ---------
Net income (loss) (Note 2) $ (10,363) $ (4,540)
========= =========
Net income (loss) per common share $ (.01) *
========= =========
Weighted average number of common
shares outstanding 1,788,756 1,788,756
========= =========
* Less than $.01 per share
See accompanying notes.
2
</TABLE>
<PAGE>
COGENCO INTERNATIONAL, INC.
(A Development Stage Company)
<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS
For the Nine Months Ended December 31, 1995 and December 31, 1996 and
Cumulative Amounts from Inception of the Development Stage
(July 26, 1990) Through December 31, 1996
(Unaudited)
Nine Months Ended Cumulative
December 31, amounts from
1995 1996 inception
-------- -------- ---------
<S> <C> <C> <C>
Revenues:
Interest Income $ 4,778 $ 3,719 $ 22,852
Costs and Expenses:
Legal fees - related party
(Note 3) 11,037 5,277 140,674
Consulting and travel expenses -
related party 10,000 4,227 144,864
Dry hole costs (recovery) (2,587) - 123,086
General and administrative 4,803 5,147 187,332
--------- --------- ---------
Total costs and expenses 23,253 14,651 595,956
--------- --------- ---------
Net income (loss) (Note 2) $ (18,475) $ (10,932) $(573,104)
========= ========= =========
Net income (loss) per common share $ (.01) $ (.01) $ (.52)
========= ========= =========
Weighted average number of common
shares outstanding 1,788,756 1,788,756 1,108,955
========= ========= =========
* Less than $.01 per share
See accompanying notes.
3
</TABLE>
<PAGE>
COGENCO INTERNATIONAL, INC.
(A Development Stage Company)
<TABLE>
<CAPTION>
STATEMENT OF STOCKHOLDERS' EQUITY
For the Nine Months Ended December 31, 1996
(Unaudited)
Common stock Additional Total
----------------------- paid-in Accumulated stockholders'
Shares Amount capital deficit equity
------ ------ ---------- ------------ -------------
<S> <C> <C> <C> <C> <C>
Balance at March 31, 1996 1,788,756 $17,888 $2,054,400 $(1,931,633) $140,655
Net loss for the nine months
ended December 31, 1996 - - - (10,932) (10,932)
--------- ------- ---------- ----------- --------
Balance at December 31, 1996 1,788,756 $17,888 $2,054,400 $(1,942,565) $129,723
========= ======= ========== =========== ========
See accompanying notes.
4
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
COGENCO INTERNATIONAL, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS
For the Nine Months Ended December 31, 1995 and
December 31, 1996 and Cumulative Amounts from Inception
of the Development Stage (July 26, 1990)
Through December 31, 1996
(Unaudited)
Nine Months Ended Cumulative
December 31, amounts from
1995 1996 Inception
-------- ------- ---------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $(18,475) $ (10,932) $(573,104)
Consulting fees paid directly by
common stock purchases - - 50,000
Increase in interest receivable - (1,202) (1,202)
Increase (decrease) in accounts
payable (10,959) 362 5,809
--------- --------- ---------
Net cash used in operations (29,434) (11,772) (518,497)
Cash flows from investing activities:
Acquisition of equipment - (3,572) (3,572)
--------- --------- ---------
Net cash used in investing
activities - (3,572) (3,572)
Cash flows from financing activities:
Proceeds from sale of common stock - - 647,800
Short-term borrowings - - 100,000
Repayments of short-term borrowings - - (100,000)
--------- --------- ---------
Net cash provided by financing
activities - - 647,800
--------- --------- ---------
Net increase (decrease) in cash (29,434) (15,344) 125,731
Cash and cash equivalents at
beginning of period 179,060 141,105 30
--------- --------- ---------
Cash and cash equivalents at
end of period $ 149,626 $ 125,761 $ 125,761
========= ========= =========
See accompanying notes.
5
</TABLE>
<PAGE>
COGENCO INTERNATIONAL, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
December 31, 1996
1. Basis of presentation
- ------------------------
The accompanying financial statements have been prepared by the Company, without
audit. In the opinion of management, the accompanying unaudited financial
statements contain all adjustments (consisting of only normal recurring
accruals) necessary for a fair presentation of the financial position as of
March 31, 1996 and December 31, 1996, and the results of operations and cash
flows for the periods ended December 31, 1995 and 1996.
Concentrations of credit risk:
Financial instruments which potentially subject the Company to concentrations of
credit risk consist principally of cash. The Company places its cash with high
quality financial institutions, which deposits are insured up to $100,000 per
institution by the Federal Deposit Insurance Corporation (FDIC). At March 31,
1996, and December 31, 1996, the Company's cash deposits exceeded the FDIC
insurance limit of $100,000, by $41,105 and $25,761, respectively.
2. Income taxes
- ---------------
No provision for income taxes is required at December 31, 1995 or 1996 because,
in management's opinion, the effective tax rate for the years will be zero.
As of March 31, 1996 and December 31, 1996, total deferred tax assets and
valuation allowance are as follows:
March 31, December
1996 31, 1996
--------- ---------
Deferred tax assets resulting from
loss carryforward $221,000 $225,000
Valuation allowance (221,000) (225,000)
-------- --------
$ - $ -
======== ========
3. Related party transactions
- -----------------------------
For the period from inception of the development stage to December 31, 1996, the
Company incurred legal costs of $88,221, from a law firm which was formerly a
principal stockholder. A former principal of that law firm is a relative of an
officer and director of the Company.
For the nine months ended December 31, 1995 and 1996 and from inception of the
development stage, the Company incurred legal costs of $11,037, $5,277 and
$52,453, respectively, from a law firm in which a principal of the law firm is a
relative of an officer and director of the Company. As of December 31, 1996, $25
was owed to this related law firm.
6
<PAGE>
COGENCO INTERNATIONAL, INC.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
- ------------------------------------------------------------------------
Material Changes in Financial Condition
---------------------------------------
At December 31, 1996, the Company had working capital of $126,151 as
compared to working capital of $140,655 on March 31, 1996. The decrease
is attributable primarily to a net operating loss for the nine month
period of $10,932. This was caused principally by costs and expenses
consisting of legal fees of $5,277, travel expenses of $4,227, accounting
fees of $3,841, miscellaneous expenses of $1,306 with minimal offsetting
interest and miscellaneous income of $3,719. No charges have been made
for management of the Company for the three month period ended December
31, 1996 since the officers of the Company waived any management fees
payable by the Company. No charge has been made for rent, since the cost
would be minimal. The Company expects to continue incurring expenses for
seeking and evaluating business prospects until it acquires or
participates in a business opportunity. Since the Company became
inoperative in 1988, its management has been seeking an appropriate
acquisition candidate to acquire .
Material Changes in Results of Operations
-----------------------------------------
The Company is not operating in any business at this time but is
continuing to seek out business opportunities and, if appropriate
financing is obtained, will operate in the oil and gas business. It is
anticipated that the Company will continue to incur losses in the near
future.
PART II
Item 6. Exhibits and Reports on Form 8-K.
A. Exhibits
None
B. Reports on Form 8-K
During the three months ended December 31, 1996, the Company
filed no reports on Form 8-K.
7
<PAGE>
COGENCO INTERNATIONAL, INC.
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.
Date: February 12, 1997 /s/ David W. Brenman
----------------------------
David W. Brenman, President
8
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S FORM 10-QSB FOR THE PERIOD ENDED DECEMBER 31, 1996 AND IS
QUAIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FORM 10-QSB.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-END> DEC-31-1996
<CASH> 125,761
<SECURITIES> 0
<RECEIVABLES> 1,202
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 126,963
<PP&E> 3,572
<DEPRECIATION> 0
<TOTAL-ASSETS> 130,535
<CURRENT-LIABILITIES> 812
<BONDS> 0
0
0
<COMMON> 17,888
<OTHER-SE> 2,054,400
<TOTAL-LIABILITY-AND-EQUITY> 130,535
<SALES> 0
<TOTAL-REVENUES> 3,719
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 14,651
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (10,932)
<INCOME-TAX> 0
<INCOME-CONTINUING> (10,932)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (10,932)
<EPS-PRIMARY> (.01)
<EPS-DILUTED> (.01)
</TABLE>
