<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15 (d) of the Securities Exchange
Act of 1934
For the quarterly period ended: January 31, 1997
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OR
[ ] Transition Report Pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934
For the transition period from to
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Commission file number: 0-188
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CEC Properties, Inc.
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(exact name of registrant as specified in its charter)
Delaware 13-1919940
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(State or other jurisdiction of (IRS Employer Identification Number)
Incorporation or Organization)
1500 W. Balboa Blvd. Suite 201, Newport Beach, CA 92663
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(Address of principal executive offices) (Zip Code)
(714) 673-2282
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(Registrant's Telephone Number, including area code)
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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 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 reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes No x
----- -----
Applicable only to issuers involved In bankruptcy proceedings
during the preceding five years.
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
subsequent to the distribution of securities under a plan confirmed by a court.
N/A
Yes No x
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Applicable only for corporation issuer's
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date. N/A
<PAGE> 2
CEC PROPERTIES, INC.
(a Delaware Corporation)
CONSOLIDATED BALANCE SHEET
Unaudited
<TABLE>
<CAPTION>
As of As of
October 31, 1996 January 31, 1997
Audited Unaudited
------------ ------------
<S> <C> <C>
TOTAL ASSETS
Investment - Real Estate (net) $ 1,084,355 $ 1,078,975
Cash in the Bank 2,318 3,513
Other 27,715 24,746
TOTAL ASSETS $ 1,114,388 $ 1,107,234
============ ============
LIABILITIES AND CAPITAL
LIABILITIES
Trust Deeds Payable $ 1,042,896 $ 1,043,284
Due to Stockholders 85,775 112,975
Other 33,710 24,327
TOTAL LIABILITIES $ 1,162,381 $ 1,180,586
------------ ------------
CAPITAL & EQUITY
Common Stock $ 125,667 $ 125,667
Additional Paid In Capital $ 23,297,402 $ 23,297,402
Accumulated Deficit $(23,471,063) $(23,496,421)
Current Loss 0 $ (25,357)
NET STOCKHOLDER EQUITY (47,993) (73,352)
TOTAL LIABILITIES & CAPITAL $ 1,114,388 $ 1,107,234
============ ============
</TABLE>
THE ACCOMPANYING NOTES ARE INTEGRAL TO THESE FINANCIAL STATEMENTS
<PAGE> 3
CEC PROPERTIES, INC.
CONSOLIDATED STATEMENT OF INCOME & EXPENSES
THREE MONTHS ENDED JANUARY 31,
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
INCOME
RENTAL INCOME $ 17,736 $ 21,133
EXPENSES
INTEREST $ 19,956 17,524
OTHER EXPENSES 17,758 8,429
DEPRECIATION 5,380 5,380
-------- --------
TOTAL EXPENSES $ 43,094 $ 30,728
NET PROFIT or LOSS $(25,357) $ (9,595)
======== ========
Net Income Per Common Share (0.002) (0.001)
======== ========
CONSOLIDATED STATEMENT OF CASH FLOWS
FUNDS WERE PROVIDED BY:
Operations $ 8,349 $ 5,380
Non Current 388 761
Loans from Shareholder 27,200 --
-------- --------
Total Funds Provided $ 35,937 $ 6,141
FUNDS WERE USED FOR:
Net Loss from Operation (25,357) (14,079)
Accrued Expense (9,384) (4,520)
Real Estate Investments 0 (4,149)
-------- --------
Total Funds Used $(34,742) $(22,748)
Increase (Decrease) in Cash $ 1,195 $(16,607)
======== ========
Beginning Cash 2,318 37,019
Changes in Cash 1,195 (16,607)
Ending Cash $ 3,513 $ 20,412
======== ========
</TABLE>
THE ACCOMPANYING NOTES ARE INTEGRAL TO THESE FINANCIAL STATEMENTS
<PAGE> 4
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Unaudited
ACCOUNTING POLICY
The financial statements are reported on a consolidated basis with the company's
wholly owned subsidiary CEC Properties, Corp. All material intercompany
transactions have been eliminated.
All adjustments made to the financial statements are of a normal recurring
nature necessary to present fairly the financial condition of the company.
NOTE 1 - INVESTMENT PROPERTIES
At the end of the year the company have three smaller real estate rental
properties. Subsequent to this quarter one property sold. The company has
acquired the lease rights to two golf course properties and is in the process of
acquiring three additional golf course properties.
<PAGE> 5
CEC PROPERTIES, INC.
(A DELAWARE CORPORATION)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF OPERATIONS
The company is in the business of locating, building or buying properties that
fit into the Sports Entertainment field. CEC searches for undervalued,
mismanaged or underutilized properties that, for whatever reason, are in
financial difficulty. CEC's turnaround management techniques and expertise in
marketing can quickly take advantage of the opportunity. CEC currently has
letters of intent accepted by 3 other golf course properties. A development
agreement has been awarded to CEC and partners from the City of Barstow,
California for the construction of a golf course and a 40 year lease with
options has been signed with the County of Ventura for the construction of a
golf course and associated development.
OPERATIONS
The company had no significant real estate transactions during the quarter ended
January 31,1997. The company continues to rent properties and collect those
rents to cover operating expenses. The company is processing two golf course
properties and is continuing to look for other acquisitions. The company does
not have any full-time employees at this time and relies on the expertise of its
board, management and outside consultants for operations.
CAPITAL AND LIQUIDITY
Management is of the opinion that capital and liquidity is sufficient to meet
operating requirements of the company for the near future. Management has no
immediate plans to seek outside sources of operating capital other than through
merger/acquisition of other companies and financing future acquisition of real
estate projects. Changes in operations between quarter is nominal in that the
company is still relatively young in its operations and has yet to become
significantly involved in a larger business transaction.
Management's intention to strengthen the capital position of the Company through
the acquisition of golf course properties at prices which are discounted enough
to insure a positive cash flow and positive equity.
<PAGE> 6
CEC PROPERTIES, INC.
(A DELAWARE CORPORATION)
INDEX TO FORM 10-QSB
JANUARY 31, 1997
Part I - Financial Information
Item 1 - Financial Statements
o Consolidated Balance Sheets
o Consolidated Income Statements
o Consolidated Statements of Cash Flow
o Notes to Consolidated Financial Statements
Item 2 - Management's Discussion and Analysis of Operations
See attached exhibit
Item 6 - Exhibits and Reports on Form 8-K
a. Exhibits
Exhibit 27 -- Financial Data Schedule
b. Reports on Form 8-K
None
<PAGE> 7
SIGNATURES
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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.
CEC PROPERTIES, INC.
Dated: May 12, 1997 By: /s/ PAUL BALALIS
------------------------------------
Paul Balalis, President
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-1996
<PERIOD-START> NOV-01-1996
<PERIOD-END> JAN-31-1997
<CASH> 3,513
<SECURITIES> 0
<RECEIVABLES> 24,746
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 28,259
<PP&E> 1,078,975
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,107,234
<CURRENT-LIABILITIES> 24,327
<BONDS> 1,043,284
0
0
<COMMON> 125,667
<OTHER-SE> (86,044)
<TOTAL-LIABILITY-AND-EQUITY> 1,107,234
<SALES> 0
<TOTAL-REVENUES> 17,736
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 23,138
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 19,956
<INCOME-PRETAX> (25,357)
<INCOME-TAX> 0
<INCOME-CONTINUING> (25,357)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (25,357)
<EPS-PRIMARY> (0.002)
<EPS-DILUTED> (0.002)
</TABLE>
