SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
AND EXCHANGE ACT OF 1934.
For the quarterly period ended September 30, 2000.
Commission file number 01-15109
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CALA CORPORATION
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(Exact name of registrant as specified in its charter)
Oklahoma 73-1251800
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(State of other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
100 N. Broadway, Suite 1890
Oklahoma City, Oklahoma 73102
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(Address of principal executive offices)
(405) 235-4960
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(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed out 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 sorter period that the
registrant was required to file such report(s), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
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Indicate the number of shares outstanding of each of our issuer's classes
of common stock, as of the latest practicable date.
Common Stock 47,918,748
Par Value $0.005 Shares outstanding as of
Pre Share September 30, 2000
Transitional Small Business Disclosure Format Yes No X
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Cala Corporation
Balance Sheet
Comparative Balances for December 31, 1999 and September 30, 2000
ASSETS
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UNADUDITED AUDITED
September 30, December 31,
2000 1999
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CURRENT ASSETS
Cash and cash equivalents $ 83,103 $ 96,699
Accounts Receivable 131,476
Inventory 16,069
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$ 214,579 $ 112,768
PROPERTY AND EQUIPMENT, net $ 56,423 $ 65,795
OTHER ASSETS
Organizational cost, net $ 4,000
Deposits $ 7,550 6,622
Lease Assignments net 972,330
Other Investments 16,800
A.P.O.L. srl 5,917
B'Tec of Italy 87,962
San Giuseppe Molino 158,582
Cala Corporation of Italy 15,500
Golf Course (lL Picciolo) 3,050,143
L'Italiano Cafe 184,761
Non-Profit Foundation 9,000
Pedana Construction Co. 361,822
Undersea Hotel 1,266,022
Total Other Investments 5,139,709 999,752
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Total Assets $5,418,261 $1,178,315
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Cala Corporation
Balance Sheet
Comparitive Balances for December 31,1999 and September 30, 2000
LIABILITIES AND STOCKHOLDERS EQUITY
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Unaudited Audited
September 30, 2000 December 31, 1999
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<S> <C> <C>
CURRENT LIABILITIES
Accounts payable $ 35,183 $ 82,233
Accrued expenses 5,235 268,642
Taxes payable 93,440
Notes payable 204,075 893,635
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Total current liabilities $ 337,933 $ 1,244,510
LONG-TERM DEBT $ 3,310,000 $ 86,528
STOCKHOLDERS' EQUITY
Series A 10% cumulative preferred
stock, Par value $.01, 250,000 shares
authorized, and No shares issued and outstanding -- 2,500
Series AA 6% cumulative convertible preferred
Stock, par value $0.10,10,000 shares authorized
1,385 shares issued and outstanding
Common stock - par value $.005,50,000,000 shares 138,500 149
Authorized 47,918,748 shares issued and outstanding 239,594 123,311
Additional paid-in capital 9,421,669 7,446,903
Retained Earnings Bakery, Minority Interest (deficit) (34,378)
Retained Earnings Pendana Constr, Minority Int.(deficit) (107,437)
Retained Earning (deficit) (7,885,042) (7,724,384)
Less: Treasury Stock - 4,530 shares at (2,578) (1,202)
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Total Stockholders' Equity $ 5,418,261 $ 1,178,315
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Cala Corporation
Statement of Operations
For the Year Ended December 31,1999 and the nine months Ended September 30,2000
Unaudited
September 30, 2000 December 31, 2000
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REVENUES $ 1,480,906 $ 978,322
COST OF SALES 1,027,971 365,103
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GROSS PROFIT $ 452,935 $ 613,219
OPERATING COSTS AND EXPENSES
General, selling, and administrative $ 488,453 $ 474,544
Maintenance and operation 63,102 580,058
Depreciation 28,176 63,331
Amortization 41,665 27,670
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Total Expenses $ 621,396 $ 1,145,603
Net Loss (before extra-ordinary items) (168,461) (532,384)
EXTRA-ORDINARY ITEMS
Gain on Sale of Restaurant 96,229 --
Gain (loss) on Abandoned Projects 10,272 --
Forgiveness of Debt 3,000 --
Interest Expense $ (97,675) --
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Total extra-ordinary items 11,826 0
Net (loss) after extra-ordinary items (156,635) (532,384)
Loss Per Share (0.0033) (0.04)
Fully Diluted Loss Per Share (0.0033) (0.04)
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Cala Corporation
Statement of Cash Flows
For the Year Ended December 31, 1999 and
The Nine Months Ended September 30, 2000
Unaudited
September 30, 2000 December 31, 1999
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Cash flows from operating activities
Net Loss $ (156,635) $ (532,384)
Net Loss - Bakery (34,378)
Net Loss - Construction (107,437)
Adjustments to reconcile net income to net cash
Provided by operating activities:
Depreciation and Amortization 69,841 91,001
Changes in Assets and Liabilities
(Increase) decrease in:
Accounts Receivable (131,476) --
Inventory 16,069 (2,503)
Deposits and Organizational Costs 3,072 22,830
Increase (decrease) in:
Accounts Payable (47,050) (99,102)
Accrued Expenses (169,967) 128,053
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(259,511) 140,279
Net Cash used by Operating activities (557,961) (392,105)
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Cash flow from Investing Activities
Purchase of disposal of property/equipment 18,804 78,895
Acquisition of other investments 4,192,244 (1,000,000)
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Net cash used by investing activities (4,211,048) (921,105)
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Cash flows form financing activities
Principal payments on long term debt 2,533,912 (80,203)
Issuance of stock 2,225,524 (1,949,637)
Error correction (4,023) (900)
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Net cash provided by financing activities 4,755,413 1,413,534
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Net (decrease)/increase in cash and cash equivalents $ (13,596) $ 100,324
Cash and cash equivalents at beginning of period 96,699 (3,625)
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Cash and Cash equivalents at end of period $ 83,103 $ 96,699
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Supplement cash flow information:
Cash paid during the year for interest $ 97,675
Cash paid during the year for income taxes
See Accountant's Compilation Report
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Cala Corporation
Statement of Stockholders' Equity
For the Nine Months Ended September 30, 2000
Unaudited
Series A Series AA Common Stock Retail
Preferred Preferred ---------------------- Paid-in Earnings Treasury
Stock Stock Shares Amount Capital (Deficit) Stock
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Beginning Balance, 1/1/00 $ 2,500 $ 149 24,662,156 $ 123,311 $ 7,446,903 ($ 7,724,384) $ (1,202)
Common Stock issued for
Payment of expense debt
And debt financing 23,256,592 118,095 2,121,305
Prior Period Adjustment 148,351 (1,812) (146,539) (4,023)
Preferred Stock Exchange
2,500 for common (2,500) (10,000) (1,376)
Net (loss) -- -- -- -- -- (298,450) --
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Ending balance,6/30/00 $ -- $ 138,500 47,918,748 $ 239,594 $ 9,421,669 $ (8,026,857) $ (2,578)
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See accountants' reports and notes to financial statements.
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Cala Corporation
Notes to Consolidate Financial Statements
Item 1. Business
In the opinion of the company, the accompanying unaudited financial
statements contain adjustments (including normal, recurring accruals and
one-time non-recurring adjustments) necessary to present the financial position
as of September 30, 2000 and the results of operations and statements of cash
flow for the nine months ending September 30,2000. These results are not
necessarily indicative of the results to be expected for the full year.
A. Presentation of Prior Year Information:
As of December 31,1999, the company owned and operated the
following businesses:
Two Ground Floor Cafe Restaurants Located in Oklahoma City
For further discussion, see from 10-KSB for December 31,1999
B. Accounting Policies:
During interim periods the Company followed the accounting
policies set forth in its consolidated financial statements
included in its annual report on form 10-KSB. Reference should be
made to these financial statements for information on such
accounting policies and further financial details.
Item 2: Managements Discussion and Analysis of Plan of Operation:
A. Operations:
Development of Cala Corporations, Undersea Resort continues as
Economic Research Associates (ERA) completed its previously
commissioned feasibility study. ERA's report established that the
Undersea Resort should accommodate certain elements to insure its
success. The report stated that the resort should be located at a
site that provides a superior marine habitat and incorporates an
attractive venue featuring special underwater learning
experiences and has active participation\entertainment elements
that attract both adventure seeking and luxury travelers.
The Undersea Resort should be comprised of three distinct yet
related experiences.
First, the Undersea "Habitat" Hotel will feature approximately 80
staterooms on two levels. The rooms will be spacious and have
large viewing windows directly into the open ocean. The rooms are
estimated to be at 13' and 22' feet below sea level.
Second, the Sea Observatory, which will start at sea level and
descend to each of the oceans levels, will incorporate education
and live underwater demonstration elements. Thirdly, the undersea
Scientific Observatory will provide a unique resource for
oceanographers and biologists to observe sea life in a 24 hour
setting. Several universities told ERA that they have a strong
interest in participating in a program of enhancement projects
for undersea environments.
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On September 19, Cala Corporation announced that Mr. John Del
Favero an international marketing and technology research expert,
agreed to serve as President of the Advisory Board for the
Undersea Resort. On October 2, Cala Corporation and John Del
Favero announced that one of the worlds leading space engineers,
Maxwell W. Hunter, had agreed to serve as Chairmen of the
Advisory Board for the Undersea Resort. Among his many
accomplishments, Mr. Hunter spent over four decades in various
senior positions of responsibility in the aerospace industry
during which he was a Presidential Advisor on U.S. National space
policy. He also was responsible for the Douglas Aircraft
Companies space efforts, including the reliable Delta launch
vehicle and the Saturn S-IV stage of the Apollo moon rocket
program.
Mr. Hunter is a recipient of numerous awards including the NASA
Public Service Medal and the renowned Werhner von Braun Memorial
Award of the National Space Society for "life long contributions
to the fields of rockets, missile and spaceflight".
On September 18, the Company announced that it was divesting its
interest in B-Tec of Italy in order to concentrate its resources
in hospitality and related business. In addition, a previously
announced effort to purchase a 23-story office complex in Naples
was terminated when management's efforts to negotiate a debt
restructuring of the building creditors proved unsuccessful.
On September 11, Cala Corporation announced it had acquired the
Etna Hotel Companies, which own and operate the El Picciolo Golf
Course, a par 72 scenic golf course located in Sicily and
designed by Luigi Rota Caremoli.
In related developments, Cala Corporation announced it was
acquiring controlling interest in Spa Resorts International to
head up the development of an All Suite -World Class Spa near the
El Picciolo Golf Club which would act as a prototype for Cala
Corporation strategy of building and franchising hotels and spas
internationally.
Other announcements during the quarter include the delay of the
Companies bid submission and acceptance for control of Costanzo
Industries, a large construction company base in Southern Italy.
Because of reported confusion in the Italian court system, biding
has been delayed and revised bids are being sought for the
various parts of Costanzo Industries. In a related matter Cala
Corporation acquired controlling interest in Pendana Castrufer, a
boutique construction company based in Sicily.
Revenue from continuing operations for the third Quarter, 2000 were
$1,184,745 vs. $215,515 for the same Quarter in 1999. This 450% increase is due
to Cala Corporations previously announced acquisitions of the controlling
interests of San Giuseppe Molino Mill\Bakery, Etna (IL Picciolo) Golf and
Country Club and Pedana Costrufer Construction Company. Cost of goods sold ended
September 30, 2000 for the nine months were $1,027,971 or 69.4% vs. $91,422 or
42% for continuing operations for the same period of 1999. General and
Administrative cost for the nine-month ended September 30, 2000 were $488,453
vs. $953,468 for the same period in 1999. This decrease is due previously to the
fact that shares of common stock were sold as incentives to note holder in 1999
to renew their notes from the company.
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As of September 30, 2000, Cala Corporation operated the San Guiseppe Molino
Mill\Bakery in Sicily, Pendana Castrufur Construction Co., the El Picciolo Golf
Club and the Ground Floor Cafe located in Nichols Hills Plaza in Oklahoma City,
Oklahoma.
B. Liquidity
The company had a working capital deficit of $123,354 as of
September 30, 2000 compared to a deficit of $1,131,742 as of
December 31, 1999. The reduction in working capital deficit is
due primarily to the company's success in converting debt into
equity.
Part II OTHER INFORMATION
Item 6. Exhibits and reports on Form 8-K
The following exhibits are included herein:
(a) Statement re: Computation of Earnings Per Share
(27) Exhibit 27
(b) The Company did not file any report form on Form 8-K
during the quarter.
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(a) Statement re: Computation of Earnings Per Share.
NINE MONTHS NINE MONTHS
ENDED ENDED
September 30, September 30,
2000 1999
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Net income (loss) for computer $ (156,635) $ (356,823)
Earning per common share
Weighted average number of 47,068,140 15,290,576
Common share outstanding
During each period without
Dilution
Addition form assumed Exercise -- 400,500
Of common stock warrants
Addition from concession of 225,000 225,000
Series AA6% cumulative
Convertible preferred
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47,293,140 15,916,176
Net income per common share
Without dilution $ (0.0033) $ (0.02)
Fully diluted $ (0.0033) $ (0.02)
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Signatures
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Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CALA CORPORATION
Dated: November 10, 2000 By: /s/ Joseph J. Johnston
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Joseph J. Johnston, Vice President
