Form 10-QSB
CONFORMED
Securities and Exchange Commission
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from
Commission File Number 0-15545
Logitek, Incorporated
(Exact name of registrant as specified in its charter)
New York No. 11-2203507
State or other jurisdiction of (I.R.S Employer
incorporation or organization Identification No.)
101 Christopher St., Ronkonkoma, N.Y. 11779
(Address of principal executive offices and ZIP Code)
Registrant's Telephone Number, including area code 516-467-4200
Securitie s registered pursuant to Section 12(g) of the Act:
Common Stock, $.001, par value None
Title of Class Name of each exchange on which registered
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) ofthe Securities Exchange Act of 1934 during the past
12 months (or for such shorter period thatthe 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 February 1, 1994, their were 3,424,000 shares of common stock
outstanding.
<PAGE>
LOGITEK, INC.
Quarterly Report on Form 10-QSB
INDEX
Page #
Part 1:FINANCIAL INFORMATION
Item 1.Financial Statements
Balance Sheets as of March 31, 1996 and June 30, 1995 3
Statements of Operations and Retained Earnings for the Nine
and Three Months Ended March 31, 1996 and 1995 4
Statements of Cash Flows for the Nine and Three Months
Ended March 31, 1996 and 1995 5
Notes to Financial Statements 6
Item 2.Management's Discussion and Analysis of Financial Condition
and Results of Operations 7
Part II:OTHER INFORMATION
Item 4.Submission of Matters to a Vote of Security Holders
Item 6.Exhibits and Reports on Form 8-K
a) Exhibits 9
b) Reports on Form 8-K 9
Signatures 10
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
LOGITEK, INC
BALANCE SHEETS
ASSETS March 31,1996 June 30,1995
Current Assets: (unaudited)
Cash $336,834 $139,751
Accounts Receivable 288,136 341,777
Inventories (Note 2) 1,019,536 811,036
Prepaid expenses and other 55,660 38,764
Due from officer 30,500 3,500
Total Current Assets 1,730,666 1,334,828
Property and equipment, less
accumulated depreciation 703,554 694,378
Other Assets:
Deferred Income Taxes 7,000 7,000
Goodwill 34,441 34,441
Other 29,698 29,756
Total Assets 2,505,359 2,100,403
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current Liabilities:
Current portion of long-term debt (Notes 3 & 4)$140,160 $297,254
Accounts payable 504,221 312,952
Accrued expenses 179,572 92,545
Total current liabilities 823,953 702,751
Long-term debt, less current (Notes 3 & 4) 577,448 461,265
Deferred income taxes 30,831 13,380
Total Liabilities 1,432,232 1,177,396
STOCKHOLDERS' EQUITY
Common stock, $.01 par value; authorized
10,000,000 shares; issued 3,600,000 shares 36,000 36,000
Capital in excess of par value 280,355 280,355
Retained earnings 762,272 612,152
Sub-total 1,078,627 928,507
Less:
Treasury shares, at cost, 176,000 shares (5,500) (5,500)
Total stockholders' equity 1,073,127 923,007
Total liabilities and stockholders' equity $2,505,359 $2,100,403
See notes to the financial statements.<PAGE>
LOGITEK, INC
STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
For the Three and Nine Months Ended March 31, 1996 and 1995
(Unaudited)
Three Months Ended Nine Months Ended
March 31, March 31
1996 1995 1996 1995
Net sales $862,735 $611,413 $2,534,572 $2,272,097
Cost of goods sold 502,683 413,484 1,496,786 1,508,332
Gross profit 360,052 197,929 1,037,786 763,765
Operating expenses:
Selling 82,579 57,923 202,910 194,276
General and
administrative (Note 4) 177,477 116,059 487,089 407,298
Research and development 53,780 12,347 108,026 57,920
Total operating expenses 313,836 186,329 798,025 659,494
Income (loss) from operations 46,216 11,600 39,761 104,271
Other (income) expense:
Interest expense, net 20,770 18,971 63,041 69,237
Legal settlement (Note 3) - - - -
Loss on disposal of fixed assets - -
Total other (income) expense 20,770 18,971 63,041 69,237
Income (loss) before
provision for income taxes 25,446 (7,371) 176,720 35,034
Provision for Income taxes 4,000 (10,000) 26,600 (17,841)
Net income (loss) 21,446 2,629 150,120 52,875
Retained earnings,
beginning of period 740,826 568,165 612,152 517,919
Retained earnings,
end of period 762,272 570,794 762,272 570,794
Per share amounts
Net income (loss) $0.01 $.01 $0.04 $0.01
Weighted average shares
outstanding 3,424,000 3,424,000 3,424,000 3,424,000
See notes to financial statements.<PAGE>
LOGITEK, INC.
STATEMENTS OF CASH FLOWS
For the Nine and Three Months Ended March 31, 1996 and 1995
(Unaudited)
Three Months Ended Nine Months Ended
March 31, March 31,
1996 1995 1996 1995
Net income (loss) $21,446 $2,629 $150,120 $52,875
Adjustments to reconcile net
income (loss) to cash provided
(used) by operations:
Depreciation 24,250 24,250 72,750 72,750
Amortization of unearned
compensation - - - -
Accounts receivable 298,294 14,182 53,641 20,126
Inventories (88,500) (8,615) (208,500) 2,104
Prepaid expenses and other(2,732) 29,900 (16,896) 20,449
Other assets 422 32 58 (80)
Accounts payable (16,039) (2,906) 191,269 85,442
Accrued expenses 55,095 (109,652) 87,027 (274,796)
Due from officer 0 (300) (27,000) 13,800
Deferred taxes (5,149) (10,000) 17,451 (20,000)
Total adjustments 265,641 (63,109) 169,800 (80,205)
Net cash provided (used) by
operating activities 287,087 (60,480) 319,920 (27,330)
Cash flows from investing activities:
Acquisition of equipment (15,060) (15,668) (81,926) (15,668)
Net cash provided by
investing activities (15,060) (15,668) (81,926) (15,668)
Cash flows from financing activities:
Repayment of long-term debt(31,778) (22,266) (40,911) (102,147)
Capitalized lease obligation 0 0 0 (10,152)
Net cash (used) by financing activities
(31,778) (22,266) (40,911) (112,299)
Net increase (decrease) in cash
(45,544) (6,466) (56,883) 79,777
Net increase (decrease) in cash
240,249 (98,414) 197,083 (155,297)
Cash, beginning of period 96,585 222,340 139,751 279,223
Cash, end of period $336,834 $123,926 $336,834 $123,926
Supplemental disclosures:
Cash paid for:
Interest $20,770 $18,971 $63,041 $69,237
See notes to financial statements.
<PAGE>
LOGITEK, INC.
Notes to Financial Statements
Note 1 - Basis of Presentation
The financial statements included herein have been prepared by the Company,
without audit, pursuant to the rules and regulations of the Securities and
Exchange Commission and reflect all adjustments which are, in the opinion of
management, necessary to present fairly the information required therein.
Certain information and footnote disclosures normally included in the
financial statements prepared in accordance with generally accepted
accounting principles have been omitted pursuant to such rules and
regulations, although management believes that the disclosures are adequate
to make the information presented not misleading. It is suggested that these
financial statements be read in conjunction with the financial statements and
notes thereto included in the Company's Form 10-KSB filed with the Securities
and Exchange Commission for the year ended June 30, 1995.
The results of operations for the three and nine months ended March 31, 1996
are not necessarily indicative of the results of operations to be expected
for the full year.
NOTE 2 - Inventories
Inventories consisted of the following:
March 31, June 30,
1996 1995
Raw materials $543,379 $334,879
Work-in-process 205,089 205,089
Finished goods 271,068 271,068
Total $1,019,536 $811,036
For the three and nine months ended March 31,1996 the Company used the
gross profit method to calculate ending inventory values.
Note 5 - Provision for Income Taxes
Income taxes were different from the amounts computed by applying the
federal income tax rate to the income before taxes due to the following:
Three Months Ended Nine Months Ended
3/31/96 3/31/95 3/31/96 3/31/95
Statutory rate 34% (34)% 34% 34%
Limitation of benefit of net
operating losses 34 (34)
State income taxes, net of
federal tax benefit 2 6 2 6
General Business Credit (21) (21)
Reversal of Prior Year
Deferred Tax (142) (57)
Effective tax rate 15% (136)% 15% (51)%
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following table presents selected financial information for the periods
March 31, 1996 and 1995, respectively.
Three Months Ended Nine Months Ended
March 31 March 31,
1996 1995 1996 1995
Net sales $862,735 $611,413 $2,534,572 $2,272,097
Gross profit $360,052 $197,929 $1,037,786 $763,765
Gross margin 41.7% 32.4% 40.9% 33.6%
Operating expenses $313,836 $186,329 $798,025 $659,494
Net income (loss) $21,446 2,629 $150,120 $52,875
General
Logitek, Inc. (the "Company") reported a profit of $150,120 for the nine
months ended March 31, 1996 versus a profit of $52,875 for the prior year
period. For the quarter ended March 31, 1996 the Company reported a profit
of $21,446 compared to a profit of $2,629 for the prior year quarter.
Results of Operations
Net sales for the first nine months of fiscal 1996 were $2,534,572 compared
to $2,272,097, or an increase of $262,475. Net sales for the quarter ended
March 31, 1996 were $862,735 compared to $611,413 or an increase of $251,322.
Gross profit increased to 40.9% in the current nine month period compared
to 33.6% for the prior year.
Operating expenses for the nine months ended March 31, 1996 increased
$138,531.
Liquidity
As of March 31, 1996 and June 30, 1995 the Company had cash on hand of
$336,834 and $139,751, respectively; and, as of March 31, 1996 the Company's
current ratio was 2.10 compared to 1.90 as of June 30, 1995. Total
borrowings were $717,608 at March 31, 1996, and $ 758,579 at June 30, 1995.
This represents a decrease of $40,971.
The Company does not anticipate any new borrowings, however, if the need
arises to purchase equipment in its continuing effort to modernize its
manufacturing capability it is the Company's intention to lease such
equipment rather than purchase in order to conserve as much cash as possible.
<PAGE>
PART II - OTHER INFORMATION
Item 4. Exhibits and Reports on Form 8-K
a) Exhibits- There are no exhibits being filed with this report
b) Reports on Form 8-K None
<PAGE>
SIGNATURES
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.
LOGITEK, INC.
Registrant
Date: 5/13/96 By:
Herbert L. Fischer
President and
Chief Executive Officer
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