CONFORMED COPY
FORM 10-QSB
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(X) 15, QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarter ended January 31, 1997
OR
( ) 15, TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number: 0-17378
VITRO DIAGNOSTIC, INC.
______________________________________________________
(Exact name of registrant as specified in its charter)
Nevada 84-1012042
______________________________ _________________________________
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
8100 Southpark Way, Bldg B-1 , Littleton, Colorado 80120
_________________________________________________________________________
(Address of principal executive offices) (Zip Code)
(303) 794-2000
________________________________________________________________
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
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 such shorter
period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for at least the past 90
days.
Yes X No
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-QSB or any amendment to this form 10-QSB.
Yes X No
--- ---
The number of shares outstanding of each of the issuer's classes of
common equity as of February 27, 1997, was 6,286,816.
PART I - FINANCIAL INFORMATION
Vitro Diagnostics, Inc.
Balance Sheets
Assets
(Unaudited) (Audited)
January 31 October 31
1997 1996
Current Assets
Cash Equivalents $ 20,530 $ 22,341
Accounts Receivable 66,521 106,210
Inventories 225,896 183,326
Prepaid Expense 78,840 78,545
------------ ------
Total Current Assets 391,787 390,422
------------ ------
Property, Plant and Equipment
Leasehold Improvements 11,885 11,885
Office Equipment & Furniture 17,688 17,688
Lab & EDP Hardware & SW 175,249 165,757
------------ ------
Total Cost 204,822 195,330
Less Depreciation (166,557) (162,713)
------------ ------
Net Property & Equipment 38,265 32,617
------------ ------
Other Assets
Deposits 7,598 7,598
Inventory - Non Current 51,471 51,471
------------ ------
Total Other Assets 59,069 59,069
------------ ------
Total Assets $ 489,121 $ 482,108
======= =======
Vitro Diagnostics, Inc.
Balance Sheets
Liabilities & Stockholders Equity
(Unaudited) (Audited)
January 31 October 31
1997 1996
Current Liabilities
Accounts Payable $ 129,263 $ 121,599
Salaries & Wages Payable 0 5,864
Payroll Taxes Payable 6,223 9,877
Accrued Expenses 2,447 2,447
Notes Payable - Short Term 119,505 114,722
------------ -----
Total Current Liabilities 257,438 254,509
------------ -----
Shareholders' Equity
Common Stock: 500,000,000 Shares
Authorized; par $.001;
6,286,816 shares outstanding
at 01/31/97 and 5,666,240
outstanding at 01/31/96 280,868 280,868
Paid in Capital in Excess of Par 3,204,961 3,204,961
Accumulated Deficit (3,254,146) (3,258,230)
------------ ------
Total Shareholders' Equity 231,683 227,599
------------ ------
Total Liabilities and
Shareholders' Equity $ 489,121 482,108
======= =======
Vitro Diagnostics, Inc.
Statement of Operations
(Unaudited)
Three Months Ended
January 31,
1997 1996
------------ --------
Revenue
Product Sales 184,075 176,244
------------ --------
Gross Revenue 184,075 176,244
Cost of Sales
Product 57,682 43,654
------------ --------
Total Cost of Sales 57,682 43,654
------------ --------
Gross Profit 126,393 132,590
------------ --------
Operating Expenses
Selling, General & Admin 97,764 57,553
Research and Development 16,997 13,405
------------ --------
Total Expenses 114,761 70,958
------------ --------
Gain (Loss) from Operations 11,632 61,632
------------ --------
Other Income (Expense)
Other Income 1,200 -
Interest Expense (8,752) (7,336)
------------ --------
Total Other Income & Expense (7,552) (7,336)
------------ --------
Net Gain (Loss) $ 4,080 54,296
======== ======
Gain (Loss) Per Share of Common Stock
(6,286,816 Shares outstanding
at 01/31/97 and 5,666,240
outstanding at 01/31/96) $0.00 $0.01
======== =======
Vitro Diagnostics, Inc.
Statements of Cash Flows
Three Months Ending 01/31/97 Twelve Months Ending 10/31/96
<TABLE>
<S> <C> <C>
(Unaudited) (Audited)
January 31, October 31,
1997 1996
-------- ------------
Cash Flows from Operating Activities
Net Income (Loss) $ 4,080 128,726
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities:
Depreciation & Amortization 3,844 17,118
Expenses Incurred for Stock 49,389
Changes in Assets & Liabilities:
Decrease (increase) in-
Accounts Receivable 39,689 (46,434)
Inventories (42,570) (114,100)
Prepaid Expenses (295) (18,400)
Deposits 0 292
(Decrease) increase in-
Accounts Payable 7,664 1,656
Salaries & Wages Payable (5,864)
Payroll Taxes Payable (3,654) 1,434
Accrued Expenses 0 5,737
---------- ----------
Net Cash Provided by Operating Activities 2,894 25,418
---------- ----------
Cash Flows From Investing Activities
Capital Expenditures (9,492) (2,443)
Note Receivable Officer 0 (150)
---------- ----------
Net Cash Provided by Financing Activities (9,492) (2,593)
---------- ----------
Cash Flows from Financing Activities
Increase (Decrease) in Short Term Notes Payable 4,782 5,702
Increase (Decrease) in Notes Payable, Bank (15,870)
Proceeds from Issuance of Common Stock 611
---------- ----------
Net Cash from Investing Activities 4,782 (9,557)
---------- ----------
Net Increase (Decrease) in Cash (1,815) 13,268
Cash Beginning 22,346 9,078
---------- ----------
Cash Ending $ 20,530 22,346
============ ========
</TABLE>
Vitro Diagnostics, Inc.
Notes to the Financial Statements
January 31, 1997 (Unaudited)
Basis of Presentation
The information for the three months ended January 31, 1997 has not been
examined by independent accounts, but includes all adjustments which the
Company considers necessary for a fair presentation of the information
presented for the period.
Note #1 HISTORY OF THE COMPANY
Vitro Diagnostics, Inc. ("The Company") was incorporated under the laws of
the state of Nevada on March 31, 1986, under the name of Imperial
Management, Inc. The Company changed its name to Vitro Diagnostics, Inc.
on February 6, 1987.
The Company manufactures specialty diagnostic reagents, viz. purified
human antigens. The Company sells its purified human antigens primarily to
manufacturers of immunodiagnostic test kits.
Note #2: Accounting Policies
The Company is engaged in the development, manufacturing and marketing of
purified antigens. These products are sold domestically and
internationally: the first product was introduced November, 1990.
Accounts Receivable - The Company considers accounts receivable to be fully
collectible; accordingly, no allowance for doubtful accounts was
established. If accounts become uncollectible, they will be charged to
operations when that determination is made.
Depreciation and Amortization - Equipment is stated at lower of cost or
estimated market value and is being depreciated on the straight-line basis
over estimated useful lives of 3 to 10 years. Intangible assets are
amortized on the straight line method per the following: patents, and
trademarks 204 months. At October 31, 1995, management determined that
patents and trademarks had no future value and they were written off.
Inventories - They are valued at the lower of cost or market using the
first-in first-out method.
Inventories consist of:
01-31-97
------------
Finished Goods $67,947
Goods in Process 152,728
Raw Materials 5,221
----------
$225,896
==========
Goods in process inventory which is not expected to be completed and sold
in the next fiscal year is classified as non current.
Cash includes demand deposits at banks.
During the past two years the Company has not had employees who were
compensated for absences.
Use of estimates - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from
those estimates.
Income Taxes - Deferred income taxes arise from the temporary differences
between financial statement and income tax recognition of net operating
losses. A deferred tax asset arising from the net operating loss carryover
of approximately $600,000 has been offset by a valuation allowance.
At October 31, 1996, the Company has unused Federal net
operating loss carry forwards which expire as follows:
Carry Over Expires Original Amount Loss
From F/Y In F/Y Loss Utilized Carryover
------ ----- ----- ----- -------
1988 2003 $333,034 $140,504 $192,530
1989 2004 783,474 783,474
1990 2005 480,296 480,296
1991 2006 21,321 21,321
1995 2010 386,846 386,846
-------
$1,993,421
NOTE #3: Common Stock and Stock Transactions
The net loss per share is based upon the weighted average number of shares
outstanding during the year. Common stock warrants are not included in the
calculation of loss per share.
Note #4: LEASE OBLIGATION
The Company's lease at 8100 Southpark Way expired on December 31, 1996.
Lease payments were $4,202 per month. At the present time extended lease
terms have not been negotiated.
The Company leases its office/warehouse space from a major shareholder of
the Company. The lease payments were made by issuing stock for the rents
due.
NOTE #4: Schedule of Short Term Notes Payable
Issue Interest
Date Rate Balance
Unrelated Party ------- ------ -------
Demand Notes: 01/10/90 20.000% $12,579
06/12/90 14.453% 21,006
Related Party 06/30/95 15.00% 25,012
Corporate COO 06/29/95 15.00% 12,922
Corporate COO 08/04/95 25.00% 5,679
Corporate CEO,
Demand Note 10/31/95 21.00% 42,307
Total $119,505
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The Company's Operating Expenses for the first quarter 1997 were
$114,761, the Cost of Sales was $57,682 and Other Income/Expense netted
$7,552. These expenses total $179,995 or $59,998 per month. Gross
Revenues for the first quarter were $184,075 or $61,358 per month. This
equates to a $1,360 gain per month. On January 31, 1997 the Company had
$20,530 in Cash and $66,521 in Accounts Receivable - Trade for a total of
$87,051.
Capital is required for the new product development described in
"Description of Business (Item 1). This capital will come from operating
profits or outside investment. Assets will not be sold to finance
expansion. New Product development will be limited by the availability of
capital for expansion.
Comparison of 3 Month Periods January 1997 to January 1996
The Company's net revenue decreased from 1996. The net gain for the
first quarter 1997 of $4,080 is a decrease of $50,216 from 1996. The
revenue decrease in 1997 was due to increased expenses. Costs associated
with auditing and filing the 1995 and 1996 10KSB and additional lease
payments were the main causes for the decrease. Working capital at
January 31, 1997 amounted to $134,349 which was a $82,713 increase from
the $51,636 in working capital at January 31, 1996. An increase in
Inventories and a decrease in Short-Term Notes Payable were responsible
for the change in working capital.
The Company's revenues from product sales (purified antigens) for
the quarter ended January 31, 1997 were $184,075 or 4% more than the
$176,244 in product sales for the quarter ended January 31, 1996.
Although the Company is unaware of any major seasonal aspect that
would have a material effect on the financial condition or results of
operation, the first quarter of each fiscal year is always a financial
concern. It is not uncommon for companies to shut down their operation or
operate on a skeletal crew during the Christmas/New Year holiday.
Therefore in effect, the first quarter really has only two months for
generating revenue.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Company has duly caused this Report to
be signed on its behalf by the undersigned, thereunto duly authorized, on
February 26, 1997.
Vitro Diagnostics, Inc.
(Company)
By: /s/ Roger Hurst
Roger Hurst, President,
Chief Executive Officer
Chief Financial Officer
Chief Accounting Officer
Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on behalf
of the Company in the capacities indicated on February 26, 1997.
Principal Executive, Financial and Accounting Officer
and Director: /s/ Roger Hurst
Roger Hurst
February 26, 1997
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Vitro Diagnostics, Inc.
Form 10-QSB for the year ending January 31, 1997
SEC file no. 0-17378
Dear Sir or Madam:
Transmitted herewith through the EDGAR system is Form 10-QSB for the
quarter ended January 31, 1997 for Vitro Diagnostics, Inc. Should you have
any questions or comments concerning this matter please contact the
undersigned at 303-794-2000.
Sincerely,
Roger Hurst
President
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Statement of Financial Condition at January 31, 1997 (Unaudited) and the
Statement of Income for the Quarter Ended January 31, 1997 (Unaudited). It
is qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> Oct-31-1996
<PERIOD-END> Jan-31-1997
<CASH> 20,530
<SECURITIES> 0
<RECEIVABLES> 66,521
<ALLOWANCES> 0
<INVENTORY> 225,896
<CURRENT-ASSETS> 391,787
<PP&E> 204,822
<DEPRECIATION> 166,557
<TOTAL-ASSETS> 489,121
<CURRENT-LIABILITIES> 257,438
<BONDS> 0
<COMMON> 280,868
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 489,121
<SALES> 184,075
<TOTAL-REVENUES> 184,075
<CGS> 57,682
<TOTAL-COSTS> 114,761
<OTHER-EXPENSES> 7,552
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 4,080
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,080
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
