FORM 10QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
Commission File Number 0-3425
PLATRONICS, INC.
(Exact name of registrant as specified in its charter)
New Jersey 22-1440857
(State or other (IRS Employer
jurisdiction of Identification
incorporation) No.)
301 Commerce Road, Linden, New Jersey 07036
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 908-862-3600
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 ______ No X
Indicate by check mark whether the registrant has filed all
documents and reports required to filed by Sections 12, 13 or 15(d)
of the Securities Act of 1934 subsequent to the distribution of
securities under a plan confirmed by the court.
Yes______ No X
Indicate the number of shares outstanding of each of issuer's
classes of common stock, as of the latest practicable date:
910,140 Common Shares Outstanding
Index
Independent Accountants' Report
Financial Statements:
Condensed Balance Sheets
March 31, 1997 (audited) and
March 31, 1998 (unaudited)
Unaudited Condensed Statements of
Income Three Months Ended
March 31, 1997 and
March 31, 1998
Condensed Statement of Cash Flow
Three Months Ended March 31, 1997
and March 31, 1998
Notes to Condensed Financial
Statements
Management Discussion and Analysis or Plan of
Operation.
Signatures
INDEPENDENT ACCOUNTANTS' REPORT
Board of Directors
Platronics, Inc.
Linden, New Jersey
The accompanying condensed balance sheet of Platronics, Inc. as of
March 31, 1998 and the related condensed statements of income for
the three month and six month periods ended March 31, 1997 and 1998
and the condensed statements of cash flows for the six months ended
March 31, 1997 and 1998, included in the accompanying Securities
and Exchange Commission Form 10-Q for the period ended March 31,
1998 were not audited by us, and, accordingly, we do not express an
opinion on them.
In accordance with generally accepted auditing standards, the
balance sheet as of September 30, 1997, and the related statements
of income, stockholders' equity and cash flows for the year then
ended (not presented herein) were audited by other auditors whose
report dated October 29, 1997 expressed an unqualified opinion on
those financial statements. In our opinion, the information set
forth in the accompanying condensed balance sheet as of September
30, 1997 is fairly stated in all material respects in relation to
the balance sheet from which it has been derived.
Ferdinand, Ganek & Company, CPA, PA
Union, New Jersey
May 15, 1998
PLATRONICS, INC.
CONDENSED BALANCE SHEETS
ASSETS
September 30 March 31,
----------------- ----------------
1997 (Audited) 1998 (Unaudited)
----------------- ----------------
Current Assets:
Cash $ 45,297 $ 34,912
Accounts Receivable - Net 623,167 597,820
Inventories 402,177 524,064
Prepaid Expenses 4,259 8,663
----------- -----------
Total Current Assets 1,074,900 1,165,459
Property and Equipment - Net 96,052 193,353
Security Deposits 34,165 34,165
----------- -----------
Total Assets $ 1,205,117 $ 1,392,977
=========== ===========
See Accompanying Independent Accountants' Report
and Notes To Condensed Financial Statements
PLATRONICS, INC.
CONDENSED BALANCE SHEETS
LIABILITIES & STOCKHOLDERS' EQUITY
September 30 March 31,
----------------- ----------------
1997 (Audited) 1998 (Unaudited)
----------------- ----------------
Current Liabilities:
Note Payable - Related Party $ 350,000 $ 171,410
Accounts Payable 97,304 213,338
Deferred Rental Obligations-
Current Portion 5,834 10,000
---------- ----------
Total Current Liabilities 453,138 394,748
---------- ----------
Long-Term Liabilities:
Note Payable - Related Party -- 137,831
Deferred Rental Obligations-
Long-Term 49,998 40,832
---------- ----------
Long Term Liabilities 49,998 178,663
---------- ----------
Total Liabilities 503,136 573,411
---------- ----------
Stockholders' Equity:
Common Stock 91,003 91,003
Additional Paid in Capital 6,156 6,156
Retained Earnings 604,822 722,407
---------- ----------
Total Stockholders' Equity 701,981 819,566
---------- ----------
Total Liabilities and
Stockholders' Equity $1,205,117 $1,392,977
========== ==========
See Accompanying Independent Accountants' Report
and Notes To Condensed Financial Statements
PLATRONICS, INC.
UNAUDITED CONDENSED STATEMENTS OF INCOME
Three Months Ended Six Months Ended
----------------------- -----------------------
March 31, March 31,
----------------------- -----------------------
1997 1998 1997 1998
----------- ----------- ----------- -----------
Net Sales $ 982,358 $ 977,659 $ 1,920,564 $ 1,988,949
Cost of Sales 846,830 834,121 1,691,095 1,677,211
----------- ----------- ----------- -----------
Gross Profit 135,528 143,538 229,469 311,738
Operating Expenses:
Selling, General
and Administrative
Expenses 140,744 93,816 263,722 180,541
----------- ----------- ----------- -----------
Operating Income
(Loss) (5,216) 49,722 (34,253) 131,197
----------- ----------- ----------- -----------
Other Income (Expense):
Interest Expense (931) (13,787) (1,759) (13,787)
Misc. Expense -- -- -- 350
----------- ----------- ----------- -----------
Total Other Income
(Expense) (931) (13,787) (1,759) (13,437)
----------- ----------- ----------- -----------
Income (Loss) Before
Provision for Taxes
on Income (6,147) 35,935 (36,012) 117,760
Provision for Taxes
on Income -- 175 -- 175
----------- ----------- ----------- -----------
Net Income (Loss) $ (6,147) $ 35,760 $ (36,012) $ 117,585
=========== =========== =========== ===========
Earnings (Loss)
Per Share $ (0.01) $ 0.04 $ (0.04) $ 0.13
=========== =========== =========== ===========
Weighted Average
Number of Shares of
Common Shares
Outstanding 910,031 910,031 910,031 910,031
=========== =========== =========== ===========
See Accompanying Independent Accountants' Report
and Notes to Condensed Financial Statements
PLATRONICS, INC.
CONDENSED STATEMENTS OF CASH FLOWS
Six Months Ended
--------------------------
March 31,
--------------------------
1997 1998
--------- ---------
Operating Activities:
Net Income (Loss) $ (36,012) $ 117,585
--------- ---------
Adjustments to Reconcile Net
Income (Loss) to Net Cash
Provided by (Used in)
Operating Activities
Depreciation & Amortization 22,503 15,884
Changes in Assets and
Liabilities:
Accounts Receivable (22,306) 25,347
Inventories 31,669 (121,887)
Prepaid Expenses (23,205) (4,404)
Deferred Rental
Obligations -- (5,000)
Accounts Payable, Accrued
Expenses and Taxes 10,895 116,034
--------- ---------
Total Adjustments 19,556 25,974
--------- ---------
Net Cash Provided By
(Used in) Operating
Activities (16,456) 143,559
--------- ---------
Investing Activities:
Capital Expenditures -- (113,185)
--------- ---------
Net Cash Used in Investing
Activities -- (113,185)
--------- ---------
Financing Activities:
Decrease in Long Term Debt (15,055) (40,759)
--------- ---------
Net Cash Used in Financing
Activities (15,055) (40,759)
--------- ---------
(continued)
See Accompanying Independent Accountants' Report
and Notes to Condensed Financial Statements
PLATRONICS, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(continued)
Six Months Ended
--------------------------
March 31,
--------------------------
1997 1998
--------- ---------
Net Decrease in
Cash and Cash Equivalents (31,511) (10,385)
Cash and Cash Equivalents -
Beginning of Period 80,100 45,297
--------- ---------
Cash and Cash Equivalents -
End of Period $ 48,589 $ 34,912
========= =========
Cash Paid During the Period For:
Interest $ 1,759 $ 13,787
Income Taxes -- 175
For the purposes of the statement of cash flows, the company
considered all highly liquid debt instruments with a maturity of
three months or less to be cash equivalents.
See Accompanying Independent Accountants' Report
and Notes to Condensed Financial Statements
PLATRONICS, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
1. Presentation of Interim Information
In the opinion of the management of Platronics, Inc. the
accompanying condensed financial statements include all
normal adjustments considered necessary to present fairly the
financial position as of March 31, 1998 and the results of
operations for the three months and six months ended March
31, 1997 and 1998, and cash flows for the six months ended
March 31,1997 and 1998. Interim results are not necessarily
indicative of results for a full year.
The condensed financial statements and notes are presented as
permitted by Form 10-Q and do not contain certain information
included in the company's audited financial statements and
notes for the fiscal year ended September 30, 1997.
2. Inventories
Inventories are summarized as follows:
September 30, March 31,
------------- ---------
1997 1998
--------- ---------
Raw Materials $ 392,177 $ 509,064
Finished Goods 10,000 15,000
--------- ---------
$ 402,177 $ 524,064
========= =========
3. Note Payable - Related Party
Note payable represents an unsecured loan from a shareholder
owning a majority of the outstanding stock. The note as of
March 31, 1998 is a two-year note payable monthly including
interest at 8%. The note matures December 31, 1999.
PLATRONICS, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
4. Restatement
The accompanying condensed financial statements for the six
months ended March 31, 1998 includes prior-period information
that has been retroactively restated after the initial
reporting of the three months ended December 31, 1997.
Manufacturing overhead has been adjusted by $32,926 to
properly reflect capitalization of plating equipment. The
effect was to increase net income for the three months ended
December 31, 1997 by $32,926 ($.03 per share).
Item 2. Management's Discussion and Analysis or Plan of
Operation.
The following is management's discussion and analysis of
certain significant factors which have affected the Company's
condensed statement of operation.
The Company's income from operations before provision for
income taxes for the second quarter of fiscal 1998 was $49,722, as
compared to loss of $5,216 in the second quarter of fiscal 1997.
Net sales were $982,358 during the second quarter of fiscal 1997
and were $977,659 during the second quarter of fiscal 1998.
The Company's profit for the second quarter of fiscal 1998 as
compared to the second quarter of fiscal 1997 was due to an
increase in sales as a result of a stronger and more aggressive
sales effort accompanied by a reduction in factory overhead and
general and administrative costs.
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 hereunto duly authorized.
PLATRONICS, INC.
By /s/_________________________
Ronald Knigge, Chairman,
President & Chief Executive
Officer
By /s/________________________
Mary Lou Palumbo,
Principal Accounting Officer
Date May 21, 1998
