<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter ended August 31, 2000
Commission file number 2-92261
WESTBRIDGE RESEARCH GROUP
_______________________________________________________________________________
CALIFORNIA 95-3769474
_________________________________ _________________________________
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1150 JOSHUA WAY
VISTA, CALIFORNIA 92083
_________________________________ _________________________________
(Address of principal (Zip Code)
executive office)
Registrant's telephone number,
including area code: (760) 599-8855
_________________________________
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 90 days. Yes X No
----- -----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of a recent date: 2,103,438 shares of common stock, no par
value, as of August 31, 2000.
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
WESTBRIDGE RESEARCH GROUP AND SUBSIDIARY
CONSOLIDATED CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
AUG 31, NOVEMBER 30,
2000 1999
(UNAUDITED) (AUDITED)
----------- ------------
ASSETS
<S> <C> <C>
CURRENT ASSETS
Cash $ 340,138 $ 267,136
Trade accounts receivable, less
allowance for doubtful accounts of
$5,000 and $5,000 respectively 318,157 270,032
Inventories 99,278 89,941
Prepaid expenses and other
current assets 21,205 25,905
----------- ------------
Total Current Assets 778,778 653,014
PROPERTY AND EQUIPMENT 556,796 535,318
Less accumulated depreciation [423,603] [395,874]
----------- ------------
Net Property and Equipment 133,193 139,444
PREPAID ROYALTY, net of accumulated
amortization of $74,871 and $60,534
respectively 121,071 135,408
LONG TERM ACCOUNTS RECEIVABLE, net 130,000 130,000
----------- ------------
TOTAL ASSETS $ 1,163,042 $ 1,057,866
=========== ============
</TABLE>
See accompanying notes to consolidated
condensed financial statements.
<PAGE>
WESTBRIDGE RESEARCH GROUP AND SUBSIDIARY
LIABILITIES AND SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
AUG 31, NOVEMBER 30,
2000 1999
(UNAUDITED) (AUDITED)
----------- ------------
<S> <C> <C>
CURRENT LIABILITIES
Accounts payable $ 27,275 $ 15,790
Notes payable - related parties 225,056 253,060
Note payable 26,478 30,234
Accrued expenses 49,344 63,260
Current portion of capital
lease obligation 16,572 14,692
Current portion of long-term debt 5,857 5,413
----------- ------------
TOTAL CURRENT LIABILITIES 350,582 382,449
Long-term debt 15,202 19,631
Capital lease obligations:
net of current portion 17,901 31,615
----------- ------------
TOTAL LIABILITIES 383,685 433,695
----------- ------------
SHAREHOLDERS' EQUITY
Common stock, no par value:
Authorized 9,375,000 shares
Issued and outstanding 2,103,438 shares 8,479,854 8,479,854
Paid in Capital: 95,000 95,000
Accumulated deficit [7,795,497] [7,950,683]
----------- ------------
TOTAL SHAREHOLDERS' EQUITY 779,357 624,171
----------- ------------
TOTAL LIABILITIES &
SHAREHOLDERS' EQUITY $ 1,163,042 $ 1,057,866
=========== ============
</TABLE>
See accompanying notes to consolidated
condensed financial statements.
<PAGE>
WESTBRIDGE RESEARCH GROUP AND SUBSIDIARY
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS NINE MONTHS
ENDED AUG 31 ENDED AUG 31
2000 1999 2000 1999
------------------------------- --------------------------------
<S> <C> <C> <C> <C>
NET SALES $ 415,901 $ 461,918 $ 1,322,604 $ 1,320,662
COST OF SALES 186,352 208,929 492,654 515,003
------------ ------------ --------------- ------------
GROSS PROFIT 229,549 252,989 829,950 805,659
------------ ------------ --------------- ------------
OPERATING EXPENSES
Research and development 33,579 41,675 106,254 106,682
Selling 113,290 101,077 335,173 329,574
General and administration 70,876 59,784 177,823 162,947
Royalties 16,092 17,022 49,899 49,514
Amortization of formula -- 6,694 -- 46,863
------------ ------------ --------------- ------------
TOTAL OPERATING EXPENSES 233,837 226,252 669,149 695,580
------------ ------------ --------------- ------------
Operating [loss] income [4,288] 26,737 160,801 110,079
OTHER INCOME (EXPENSE)
Interest expense [8,043] [6,468] [22,553] [19,046]
Interest income 6,760 5,584 16,916 9,423
Other income -- 850 1,622 7,340
------------ ------------ --------------- ------------
[Loss] Income before income taxes [5,571] 26,703 156,786 107,796
------------ ------------ --------------- ------------
Provision for income taxes -- -- 1,600 1,600
Net income $ [5,571] $ 26,703 $ 155,186 $ 106,196
Basic earnings per common share $ .00 $ .02 $ .07 $ .05
============ ============ =============== ============
Weighted average shares
outstanding 2,103,438 2,103,438 2,103,438 2,103,438
------------ ------------ --------------- ------------
Diluted earnings per
common share $ .00 $ .02 $ .07 $ .05
============ ============ =============== ============
Weighted average shares, options
and warrants outstanding 2,320,438 2,333,588 2,320,438 2,328,955
============ ============ =============== ============
</TABLE>
See accompanying notes to consolidated
condensed financial statements.
<PAGE>
WESTBRIDGE RESEARCH GROUP AND SUBSIDIARY
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
AUG 31, AUG 31,
2000 1999
====================================
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 155,186 $ 106,196
---------------- -----------------
Adjustments to reconcile net income
to net cash provided by (used in)
operating activities:
Amortization of prepaid royalty 14,337 14,337
Depreciation and amortization 27,729 63,620
Changes in Operating Assets and Liabilities:
Increase in trade accounts receivable [48,125] [96,356]
Increase in inventories [9,337] [18,736]
Decrease [increase] in prepaid expenses 4,700 [19,376]
Increase in accounts payable 11,485 28,881
[Decrease] increase in accrued liabilities [13,916] 2,560
---------------- -----------------
Net cash provided by operating activities 142,059 81,126
---------------- -----------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment [21,478] [65,942]
---------------- -----------------
Net cash used in investing activities [21,478] [65,942]
---------------- -----------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on capital lease obligations [11,834] [10,259]
Borrowings on capital lease obligations -- 34,979
Payments on notes payable and notes payable-
related parties [35,745] [14,440]
---------------- -----------------
Net Cash [used in] provided by financing activities [47,579] 10,280
---------------- -----------------
INCREASE IN CASH 73,002 25,464
CASH AT BEGINNING OF PERIOD 267,136 249,729
---------------- -----------------
CASH AT END OF PERIOD $ 340,138 $ 275,193
================ =================
</TABLE>
See accompanying notes to consolidated
condensed financial statements.
<PAGE>
WESTBRIDGE RESEARCH GROUP AND SUBSIDIARY
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
A. BASIS OF PRESENTATION:
The consolidated balance sheet as of August 31, 2000, the consolidated
statements of operations for the three and nine-month periods ended August
31, 2000, and 1999, respectively, and the consolidated statements of cash
flows for the nine-month periods then ended have been prepared by the Company
without audit. In the opinion of management, all adjustments (which include
only normal recurring adjustments except as noted in management's discussion
and analysis of financial condition and results of operations) necessary to
present fairly the financial position, results of operations and changes in
cash flows have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested that
these consolidated financial statements be read in conjunction with the
financial statements and notes thereto included in the 1999 Annual Report on
Form 10-KSB. The results of operations for the quarter ended August 31,
2000, are not necessarily indicative of the operating results for the full
year.
B. RECLASSIFICATION:
None.
C. STOCK SPLIT:
On July 17, 1997 the shareholders of the Company voted to execute a
one-for-four reverse stock split. The reverse stock split was effective for
shareholders of record on February 6,1998. Per share amounts in the
accompanying financial statements have been restated to give effect for the
reverse stock split as if it occurred on December 1, 1996.
D. SUBSEQUENT EVENTS:
None
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WESTBRIDGE RESEARCH GROUP AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS
ITEM 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
RESULTS OF OPERATIONS:
Net sales for the three month period ended August 31, 2000 were
$415,901, representing a 10% decrease from the same period in the prior year.
For the nine month period ended August 31, 2000, sales were $1,322,604 and
represents a nominal increase from $1,320,662 in the prior year. The three
month decrease is due to a significant portion of third quarter sales placed
in the second quarter of 2000 creating a 10% increase in that quarter.
Cost of sales as a percentage of net sales remained at 45% for the
quarter ended August 31, 2000 when compared with the same period in the prior
year. For the nine month period ended August 31, 2000, cost of sales as a
percentage of net sales decreased to 37% compared with 39% in the prior year.
These increases are due to increased sales of higher margin products.
Operating expenses for the three and nine month periods ended August 31,
2000 increased 3% and decreased 4%, respectively, compared with the same
periods in the prior year. The three month increase in primarily due to
increases in research and development expenses and selling expenses discussed
below. The nine-month decrease is primarily due to the company's base
technology fully amortizing during the third quarter of 1999.
Research and development expenses as a percentage of net sales for the
three and nine month periods ended August 31, 2000 were 8% and 8%
respectively, compared with 9% and 8% for the same periods in the prior year.
Selling expenses as a percentage of net sales for the three and nine
month periods ended August 31, 2000 were 27% and 25%, respectively, compared
with 22% and 25% for the same periods in the prior year. The three month
increase is primarily due to increased advertising during the period.
General and administrative expenses in the three month period ended
August 31, 2000 increased by $11,092 or 19%, and increased $14,896 or 9% for
the nine month period ended August 31, 2000 when compared with the same
periods in the prior year. These increases are primarily due to increases in
insurance, office supplies and depreciation expenses.
<PAGE>
Net loss for the quarter ended August 31, 2000 was $5,571 as compared
with net income of $26,703, for the same period in the prior year.
Accordingly, basic earnings per share decreased to approximately $.00 for the
quarter ended August 31, 2000 compared with approximately $.02 for the
quarter ended August 31, 1999.
Income taxes have not been provided for in the accompanying financial
statements of operations due to the net operating loss carry forwards
generated in prior years that are available for carry forward against current
year income.
WESTBRIDGE RESEARCH GROUP AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS
LIQUIDITY AND CAPITAL RESOURCES:
The Company has no material commitments for capital expenditures.
Working capital was $428,196 at August 31, 2000, up from $270,565 at
November 30, 1999.
Based on current cash flow projections management expects that the
Company can continue operations for the current year without infusions of
additional cash.
IMPACT OF INFLATION
The Company does not believe inflation has had a significant effect on
its operations.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
<PAGE>
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A. EXHIBITS
None
B. REPORTS ON FORM 8-K
None
WESTBRIDGE RESEARCH GROUP AND SUBSIDIARY
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.
WESTBRIDGE RESEARCH GROUP
(Registrant)
/s/ CHRISTINE KOENEMANN
------------------------------
Christine Koenemann, President
Principal Executive Officer
Principal Financial Officer
Date: October 13 , 2000
