SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of
1934.
For the quarter ended March 31, 1997 Commission file number 33-12664-D
WorldWide Golf Resources, Inc.
(Exact name of registrant as specified in its charter)
Nevada 88-0335511
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
23 Cactus Garden Drive., F-60
Henderson, Nevada 89014
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 702) 893-4747
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 _____
As of March 31, 1997, there were 12,149,248 shares of common stock outstanding.
<PAGE>
WORLDWIDE GOLF RESOURCES, INC.
AND SUBSIDIARIES
FOR THE QUARTER ENDED
MARCH 31, 1997
INDEX
PART I - FINANCIAL INFORMATION Page No.
Item 1. Financial Statements
Balance Sheet as of March 31, 1997 and
December 31, 1996 3-4
Statement of Operations for the three months
ended March 31, 1997 and 1996 5
Statement of Cash Flows for the three months ended
March 31, 1997 and 1996 6-7
Notes to Financial Statements 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operation 9-10
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 2. Changes in Securities 11
Item 3. Defaults by the Company upon its
Senior Securities 11
Item 4. Submission of Matter to a Vote of
Security Holders 11
Item 5. Other Information 11
Item 6. Exhibits and Reports of Form 8-K 11
SIGNATURES 12
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
WORLDWIDE GOLF RESOURCES, INC.
CONSOLIDATED BALANCE SHEETS
ASSETS
March 31, December 31,
1997 1996
---------- ------------
Current Assets
Cash and Cash Equivalents $ 315,841 $ 14,803
Accounts Receivable, Trade 246,972 384,877
Less Allowance for Doubtful Accounts (2,050) (2,050)
-------------- -------------
Net Receivables 244,922 382,827
Inventory, Lower of Cost or Market 445,566 575,062
Receivable, Directors and Employees 450,423 89,237
Receivable, Other 5,000 5,000
Prepaid Expenses 11,580 12,315
-------------- ------------
Total Current Assets 1,473,332 1,079,244
Property and Equipment
Golf Course Land and Improvements 1,986,205 0
Equipment 1,097,243 801,978
Office Equipment 96,605 96,605
Leasehold Improvements 14,979 14,379
-------------- ------------
3,194,432 912,962
Less Accumulated Depreciation (323,078) (261,238)
-------------- ------------
Net Property and Equipment 2,871,354 651,724
Other Assets
Cost of Assets in Excess of Book Value 5,583,551 0
Intangible Assets, Net 540,943 542,422
Deposits 36,564 43,930
-------------- ------------
Total Other Assets 6,161,058 586,352
-------------- ------------
Total Assets $10,505,744 $2,317,320
============== ============
Prepared without audit.
3
<PAGE>
LIABILITIES AND STOCKHOLDERS' EQUITY
March 31, December 31,
1997 1996
--------- -------------
Current Liabilities
Accounts Payable 720,868 548,024
Other Current Liabilities 122,354 113,475
Notes Payable, Current Portion 100,628 247,432
-------------- ------------
Total Current Liabilities 943,850 941,392
Long Term Liabilities
Stockholders' Loans 191,942 430,493
Notes Payable 2,052,993 4,832
-------------- ------------
Total Long Term Liabilities 2,244,935 435,325
-------------- ------------
Total Liabilities 3,188,785 1,376,717
Stockholders' Equity
Common Stock $.0001 Par Value,
Authorized 50,000,000 Shares;
Issued 12,149,248 at
March 31,1997 and 3,946,748
Shares at December 31,1996 1,215 395
Less Treasury stock, 1,140
Shares at March 31,1997
and 1,140 Shares at
December 31, 1996 at Cost (7,990) (7,990)
Additional Paid-in Capital 12,432,858 4,431,358
Accumulated Deficit (5,109,124) (3,483,160)
--------------- -------------
Total Stockholders' Equity 7,316,959 940,603
--------------- ------------
Total Liabilities and Stockholders' Equity $10,505,744 $ 2,317,320
============ ===========
Prepared without audit.
4
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WORLDWIDE GOLF RESOURCES, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
For the three months ended
March 31, March 31,
1997 1996
Sales, Net of Returns and Discounts $ 369,141 $ 579,945
Cost of Goods Sold 271,320 427,856
------------- -----------
Gross Profit 97,911 152,089
Operating Expenses
Selling, General and Administrative 1,562,662 279,612
------------ -----------
Operating (Loss) (1,464,751) (171,468)
Other Income (Expense)
Interest Expense (3,925) (6,077)
Loss on Sales of Assets (157,287) 0
------------ -----------
(161,212) (6,077)
------------ -----------
(Loss) Before Income Taxes (1,625,963) (177,545)
Income Taxes 0 0
------------ -----------
Net (Loss) $(1,625,963) $ (177,545)
============ ===========
Net (Loss) per Share of Common Stock $ (0.26) $ (0.06)
============= ============
Weighted average number of shares outstanding 6,253,601 2,959,083
============ ===========
Prepared without audit.
5
<PAGE>
WORLDWIDE GOLF RESOURCES, INC.
STATEMENT OF CASH FLOWS
For the three months ended
March 31, March 31,
1997 1996
Cash Flows from Operating Activities
Net Loss $(1,625,963) $(177,545)
Adjustments to Reconcile Net Loss to Net
Cash Provided by Operating Activities
Depreciation 173,142 43,945
Changes in Assets and Liabilities (261,154)
(Increase) Decrease in Assets 61,561 0
Increase (Decrease) in Liabilities 356,902 0
------------ ----------
Total Adjustments 591,605 (172,209)
------------ -----------
Net Cash Used by Operating Activities (1,034,358) (349,754)
Cash Flows from Investing Activities
Property and Equipment Purchases (2,306,558) 0
------------- ----------
Net Cash Used in Investing Activities (2,306,558) 0
Cash Flows from Financing Activities
Issuance of common stock 1,738,865 91,988
Loan Proceeds 1,845,603 216,553
Stockholder Loans 60,159 0
Sale of Treasury Stock 25,128 25,778
Merger Adjustment
Payments on Loan Proceeds (62,908) 0
------------- -----------
Net Cash Provided by Financing Activities 3,606,847 334,319
Increase (Decrease) in Cash and Cash Equivalents 265,931 (15,435)
Balance, Beginning of Year 49,910 65,345
------------- ----------
Balance, End of Year $ 315,841 $ 49,910
============= ===========
Prepared without audit.
6
<PAGE>
WORLDWIDE GOLF RESOURCES, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
For the three months ended
March 31, March 31,
1997 1996
Supplemental Information
Cash Paid for:
Interest $3,925 $6,077
======= ======
Income Taxes $ 0 $ 0
======= ======
Supplemental Schedule of Non-Cash Investing on Financing Activities:
During the quarter ended March 31, 1997, the Company issued under a
Regulation S Private Placement 706,500 shares of common stock valued at
$1.00 per share or $706,500.
On February 3, 1997, the Company entered into an agreement to exchange 100%
of the outstanding common stock of 2671914 Monitoba Ltd for 6,160,000 shares
of common stock at $0.89 per share or $5,500,000.
On March 2, 1997, the Company issued 650,000 shares of common stock for
profession services at $1.75 per share or $1,137,500.
On March 4, 1997, the Company issued 300,000 shares of common stock as
payment for notes and interest payable at $0.80 per share or $240,000
On March 4, 1997, the Company issued 300,000 shares of common stock as
payment for notes and interest payable at $0.79 per share or $236,000.
On March 29, 1997, the Company issued 86,000 shares of common stock for
professional services at $2.12 per share or $182,320.
Prepared without audit.
7
<PAGE>
WORLDWIDE GOLF RESOURCES, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1997
1. Statement of Information Furnished
The accompanying unaudited consolidated financial statements have been
prepared in accordance with Form 10-Q instructions and in the opinion of
management contain all adjustments (consisting of only normal recurring
accruals) necessary to present fairly the financial position as of March 31,
1997, the results of operation for the three months ending March 31, 1997
and 1996 and the cash flows for the three months ending March 31, 1997 and
1996. These results have been determined on the basis of generally accepted
accounting principles and practices and applied consistently with those used
in the preparation of the Company' s 1996 Annual Report on Form 10-K.
Certain information and footnote discloses normally included in
financial statements presented in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested that
the accompanying consolidated financial statement be read in conjunction
with the financial statements and notes thereto incorporated by reference in
the Company's 1996 Annual Report on Form 10--K.
8
<PAGE>
WORLDWIDE GOLF RESOURCES, INC.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Overview
The Company is engaged in 5 primary business segments in golf-relate
products and services industries; the publication of golf periodicals/video
cassettes, the manufacturing and sale of Golf driving range equipment, the
manufacturing and installation of synthetic turf at driving ranges, the
manufacturing and sale of Golf clubs, and the operation of a golf course and
country club.
Results of Operations
Three months ended March 31, 1997 and 1996.
Golf Publications
The Company's publication segment is engaged in the publication of the
Las Vegas Golf magazine, the annual Las Vegas Golf Guide and the
instructional golf video, Golf Tips for Desert Play. During 1996, and
continuing into 1997, due to limited working capital, the Company sales of
these products was minimal. The Company now plans on reestablishing the
publishing of the Las Vegas Golf Magazine again in late 1990s.
Golf Driving Range Equipment Manufacturing, Sales and Installation
The golf driving range equipment manufacturing, sales and installation
is effected through Advance Golf Systems, Inc. DBA Range Master of Temecula,
California. Net sales for the first quarter ended March 31, 1997, of
$143, 826, a decrease of $45,292 (30%) from $189,118 in the first quarter of
1996. The reduction in sales was due primarily to restrictions of working
capital. Range Master provided 39% of the Company's first quarter revenues.
The net loss for the first quarter of 1997decreased $18,359 to $40,633
from $58,992 in the first quarter of 1996. The decrease is due primarily to
a reduction of general and administrative expenses.
9
<PAGE>
WORLDWIDE GOLF RESOURCES, INC.
Synthetic Turf Manufacturing, Sales and Installation
American Turf Manufacturing's revenues for the first quarter of 1997
decreased $115,543 (59%) to $194,054, from $309,597 in the first quarter of
1996, American Turf Manufacturing provided 53% of the Company's first quarter
revenues. Management expects this unit to increase its revenue impact through
the addition of increased working capital to fill orders on hand presently.
The net loss for the first quarter of 1997 increased $12,984 to $106,876
from $93,892 in the first quarter of 1996. The increase was primarily due to
increased management salaries. Management expects this unit to continue
to become more profitable as the process of manufacturing and installing
synthetic turf becomes more streamlined.
Golf Club Assembly and Sales
Tour Precision has been relocated to the Range Master facility in
Temecula, California. Tour Precision is currently inactive and had no sales
for the first quarter of 1997 or 1996. Tour Precision is in the process of
obtaining patents on a new perimeter adjustable weighted club head.
Country Club and Golf Course
Pelican Beach Golf Course was acquired by the Company on February 1,1997.
The Golf Course recorded no sales revenues during the first quarter because
of the winter season in Manitoba, Canada.
The net loss for the first quarter 1997 was $15,595 and is represented
primarily by depreciation of $13,408 and salaries of $1,881.
Liquidity and Capital Reserves
The Company through March 31, 1997 has partially completed an offering
under Regulation S and will complete the offering in the second quarter of
1997 that will supplement the Company's working capital needs. This, along
with funds generated from operations, will allow the Company to continue its
growth and to allow for expanded customer base. Additional internal and
external sources will be sought in the coming periods as Management
institutes a thorough program of rationaizing product lines, there
individual revenue potential and their respective inventory/production
requirements.
10
<PAGE>
WORLDWIDE GOLF RESOURCES, INC.
PART II--OTHER INFORMATION
Item 1. Legal Proceedings.
None.
Item 2. Changes in Securities.
None.
Item 3. Defaults by the Company upon its Senior Securities.
None.
Item 4. Submission of Matter to a Vote of Security Holders.
None.
Item 5. Other Information.
None.
Item 6. Exhibits and Reports of Form 8--K.
A Form 8-K was filed on January 22, 1997, to report a change in control
of the registrant by issuing 6,160,000 shares of common stock to 3422488
Manitoba Ltd. Concurrent with the closing of the agreement purchasing
Pelican Beach Golf and Country Club, Dr. Srini Chary and Mac Shashsavar were
appointed to the Board of Directors.
A Form 8-K was filed on February 25, 1997, to report the change in the
Company's certified accountant from Janet Loss, C.P.A. to Clancy and Co.
P.L.L.C.
11
<PAGE>
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.
WORLDWIDE GOLF RESOURCES, INC.
(Registrant)
By:/s/Mac Shahsavar By:/s/Alice Elaine Affleck
Mac Shahsavar Alice Elaine Affleck
President and Principal Financial and
Chief Operations Officer Accounting Officer
Date: July 28, 1997 Date:July 28, 1997
<PAGE>
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