LOTUS PACIFIC, INC.
235 Route 22 East
Greenbrook, NJ 08812
(908) 752-5899
November 10, 1995
Securities And Exchange Commission
Filing Desk Stop 1-41
450 Fifth Street, NW
Washington, DC 20549
RE: Lotus Pacific, Inc.
SEC File No. 33-3272-W
To whom this may concern:
Enclosed herewith is the company's Form 10-Q, for the
quarterly period ended September 30, 1995, for electronically
filing with the Securities and Exchange Commission on behalf of
Lotus Pacific, Inc.
Please contact the undersigned if you have any questions.
Sincerely yours,
/S/
Tom H. Gong
Vice President and Treasurer
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 10-Q
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 1995
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 33-3272-W
LOTUS PACIFIC, INC.
(Exact name of registrant as specified in its charter)
___________Delaware__________ ___________23-2361275___________
(State of organization) (I.R.S. Employer Identification
Number)
35 Route 22 East, Greenbrook, New Jersey 08812
(Address of principal executive offices)
(908) 752-5899
(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 13or 15(d) of the
Securities Exchange Act of 1934 during the proceeding 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.
(1) Yes __X__ No _____
(2) Yes __X__ No _____
As of September 30, 1995, the Registrant had outstanding 26,937,054
shares of Common Stock, par value $.001 per share and 4,300 shares
of Series A Preferred Stock.
LOTUS PACIFIC, INC.
Table of Contents
PART I Financial Informationon
Item 1:
Condensed Balance
Sheets..................................5
Condensed Statement of
Operation..........................6
Condensed Statement of Cash
Flows.........................7
Item 2:
Management's Discussion and Analysis of Financial
Condition and Results of
Operations.......................8
PART II Other Information
........................................9
Part I
FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
The accompanying unaudited financial statements have been
prepared in accordance with generally accepted accounting
principles for interim financial information and the instructions
to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they
do not include all of the information and footnotes required by
generally accepted accounting principles for completing financial
statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for
a fair presentation have been included.
LOTUS PACIFIC, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
September 30, 1995
(Unaudited)
ASSETS
CURRENT ASSETS
Cash $ 237,657
Accounts receivable 62,628
Other receivable 126,657
Inventories 408,964
Prepaid expenses 22,580
Total Currents Assets $ 858,486
FIXED ASSETS (NET) 331,149
CONSTRUCTION IN PROCESS 6,568
OTHER ASSETS
Organization costs 21,350
TOTAL ASSETS 1,217,253
LIABILITIES AND STOCKHOLDERS EQUITY
CURRENT LIABILITY
Short-term loans $ 542,169
Notes payable 54,718
Accounts payable 115,388
Taxes payable (22,771)
Advances from customers 3,874
Other payable 105,566
Total Current Liabilities (a) 798,944
MINORITY INTEREST 61,416
STOCKHOLDERS' EQUITY
Preferred Stock, $.001 par value,
100,000 shares authorized,
4300 issued and outstanding 4
Common Stock, $.001 par value,
50,000,000 shares authorized,
26,937,054 issued and outstanding 26,937
Additional paid-in capital 355,972
Retained Earnings (Deficit) (26,020)
Translation adjustment
0
Total Stockholders' Equity 357,193
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY 1,217,253
The accompanying notes are an integral part of these
consolidated financial statements.
LOTUS PACIFIC, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF OPERATIONS FOR
THE THREE MONTH ENDING SEPTEMBER, 1995
Sales $ 641,176
Cost of Goods Sold 382,367
Gross Profit 258,809
Operating Expenses (128,367)
Income from Operations 130,542
Other income (Expenses), Net
Miscellaneous Income (Expense)
Interest Expense, Net (120,187)
Net Income 10,355
Minority Interest Income (a) 5,030
Consolidated Net Income 5,325
Gain/Loss Per Share 0.00
LOTUS PACIFIC, INC. AND SUBSIDIARY
STATEMENT OF CASH FLOWS FOR
THE THREE MONTHS ENDING SEPTEMBER 30, 1995
CASH FLOW FROM OPERATION ACTIVITIES
Net Income $
5,325
Additions:
Increase in accounts payable 110,988
Increase in other payable 105,988
Increase in customer advance 3,874
Subtractions:
Increase in accounts receivable
(62,628)
Increase in prepaid expenses
(22,580)
Increase in inventory
(408,964)
Increase in other receivable
(126,657)
Increase in tax receivable
(22,771)
Increase in other assets
(21,350)
Net Cash Flow From Operations
(439,197)
CASH FLOW FROM INVESTING ACTIVITIES:
Increase in minority interest (a)
61,416
Issue common stocks (a)
134,560
Acquisition of equipment
(337,717)
Net Cash Flow From Financing Activities
(141,741)
CASH FLOW FROM FINANCING ACTIVITIES:
Increase in notes payable
54,718
Increase in loan payable
542,169
Net Cash Flow from Financing Activities
596,887
NET INCREASE IN CASH AND CASH EQUIVALENTS
15,949
CASH & CASH EQUIVALENT AT BEGINNING OF THE PERIOD
221,408
CASH & CASH EQUIVALENT IN ENDING OF THE PERIOD
237,357
______________________________
Note:
(a) The acquisition of the 70% equity interest in Shanghai Union
Auto-Bicycle Co, Ltd. was treated as a purchase. The minority
interest adjustment is based on the book value of the acquired net
assets by the end of September 1995 which was deemed to be the fair
value.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
Results of Operations
The company completed an acquisition on September 29, 1995 by
entering into a Stock Exchange Agreement with United Development
Co., a Hong Kong corporation, to acquire a 70% equity interest in
Shanghai Union Auto-Bicycle Co., Ltd. ("Shanghai Union") an entity
incorporated on October 23, 1992, in Shanghai, People's Republic of
China. The remaining 30% equity ownership is held by a Chinese
corporation.
The company issued 560,000 restricted shares of its common
stock to United Development Co. as the sole consideration given for
the 70% interest in Shanghai Union. These shares represent about
2% of the issued and outstanding shares of the company's common
stock.
Shanghai Union is an equity joint venture formed and
officially registered in China as a legal business entity. The
term of its existence is 20 years and it commenced business on
January 25, 1994. Shanghai union is licensed to manufacture and
sell auto- bicycles, bicycle wheel hub motors and related parts.
The company is looking for other possible acquisitions by
mainly targeting the Far East market.
Liability and capital Resources
In conjunction with the acquisition, the company also issued
30,000 shares of common stocks with par value of $.001 to a non-
affiliated finder for consideration of $300.
As of September 30, 1995, the Corporation has 26,937,054
shares of common stock outstanding and 4,300 shares of Series A
Preferred Stock outstanding.
All matters referred to were approved by the written consent
of a majority in interest of the holders of the Corporation's
outstanding shares of common stock.
PART 2
OTHER INFORMATION
Item 1 - The exhibits listed below are filed as part of this
report:
None.
Item 2 - On October 11, 1995, the company filed a Form 8-K
regarding the acquisition shown in Part 1.
