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 December 31, 1995
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) of the Securities Exchange Act of 1934 during the past
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 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 December 31, 1995 and June 30, 1995 3
Statements of Operations and Retained Earnings for the Six
and Three Months Ended December 31, 1995 and 1994 4
Statements of Cash Flows for the Six and Three Months
Ended December 31, 1995 and 1994 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 9
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 STATEMENT
LOGITEK, INC.
BALANCE SHEETS
December 31, June 30,
ASSETS 1995 1995
Current Assets: (Unaudited)
Cash $96,585 $139,751
Accounts Receivable 586,430 341,777
Inventories (Note 2) 931,036 811,036
Prepaid expenses and other 52,928 38,764
Due from officer 30,500 3,500
Total Curent Assets 1,697,479 1,334,828
Property and equipment, less
accumulated depreciation 712,737 694,378
Other Assets:
Deferred Income Taxes 7,000 7,000
Goodwill 34,441 34,441
Other 30,120 29,756
Total Assets 2,481,777 2,100,403
LIABILITIES AND STOCKHOLDERS EQUITY:
Current Liabilities:
Current portion of long-term debt 285,209 297,254
Accounts payable 520,260 312,952
Accrued expenses 124,477 92,545
Total current liabilities 929,946 702,751
Long-term debt 464,170 461,265
Deferred income taxes 35,980 13,380
Total liabilities 1,430,096 1,177,396
STOCKHOLDERS EQUITY
Common Stock, $.01 par value; authorized
10,000,000 shares;issued 3,600,000 36,000 36,000
Capital in excess of par value 280,355 280,355
Retained earnings 740,826 612,152
Sub-total 1,057,181 928,507
Less:
Treasury shares,at cost,176,000 sh (5,500) (5,500)
Total Stockholders equity 1,051,681 923,007
Total liabilities and equity 2,481,777 2,100,403
See notes to financial statements.
<PAGE>
LOGITEK, INC
STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
For the Three and Six Months Ended December 31, 1995 and 1994
(Unaudited)
Three Months Ended Six Months Ended
December 31, December 31
1995 1994 1995 1994
Net sales $970,077 $763,502 $1,671,837 $1,660,684
Cost of goods sold 564,981 521,070 994,103 1,094,848
Gross profit 405,096 242,432 677,734 565,836
Operating expenses:
Selling 71,321 64,215 120,331 136,353
General and
administrative 187,606 148,781 309,612 291,239
Research and development 32,855 22,661 54,246 45,573
Total operating expenses 291,782 235,657 484,189 473,165
Income (loss) from operations 113,314 6,775 193,545 92,671
Other (income) expense:
Interest expense, net 20,927 26,777 42,271 50,266
Total other (income) expense 20,927 26,777 42,271 50,266
Income (loss) before
provision for income taxes 92,387 (20,002) 151,274 42,405
Provision for income taxes (Note 3) 13,767 (11,940) 22,600 (7,841)
Net income (loss) 78,620 (8,062) 128,674 50,246
Retained earnings,
beginning of period 662,206 576,227 612,152 517,919
Retained earnings,
end of period $740,826 $568,165 $740,826 $568,165
Per share amounts
Net income (loss) $0.02 $0.00 $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>
STATEMENTS OF CASH FLOWS
For the Six and Three Months Ended December 31, 1995 and 1994
(Unaudited)
Three Months Ended Six Months Ended
December 31, December 31,
1995 1994 1995 1994
Net income (loss) 78,620 ($8,062) $128,674 $50,246
Adjustments to reconcile net
income (loss) to cash provided
(used) by operations:
Depreciation 25,725 24,250 51,450 48,500
Amortization of unearned
compensation - - - -
Accounts receivable (99,065) 70,441 (244,653) 5,944
Inventories (93,500) (42,327) (120,000) 10,719
Prepaid expenses and other (23,470) (17,352) (14,164) (9,451)
Other assets (187) 39 (364) (111)
Accounts Payable 96,806 22,154 207,308 88,348
Accrued expenses 91,603 (56,909) 31,932 (165,145)
Due from officer ( 27,000) 14,550 (27,000) 14,100
Deferred taxes 22,600 (10,000) 22,600 (10,000)
Total adjustments (6,488) 4,846 ( 92,891) (17,096)
Net cash provided (used) by
operating activities 72,132 (3,216) 35,783 33,150
Cash flows from investing activities:
Purchase of equipment (49,803) - (69,809) -
Net cash provided by
investing activities 0 0 0 0
Cash flows from financing activities:
Repayment of long-term debt 18,314 (32,176) (9,140) (79,881)
Capitalized lease obligation 0 (10,152) 0 (10,152)
Net cash (used) by financing 18,314 (42,328) (9,140) (90,033)
Net increase (decrease) 40,643 (45,544) (43,166) (56,883)
Cash, beginning of period 55,942 267,884 139,751 279,223
Cash, end of period $96,585 $222,340 $96,585 $222,340
Supplemental disclosures:
Cash paid for:
Interest $20,927 $26,253 $42,271 $50,267
See notes to financial statements.
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 six months ended December 31,
1995 are not necessarily indicative of the results of operations to be
expected for the full year.
NOTE 2 - Inventories
Inventories consisted of the following:
December 31, June 30,
1995 1995
Raw materials $454,879 $334,879
Work-in-process 205,089 205,089
Finished goods 271,068 271,068
Total $931,036 $811,036
For the three and six months ended December 31, 1995 the Company used the
gross profit method to calculate ending inventory values.
Note 3 - 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 Six Months Ended
12/31/95 12/31/94 12/31/95 12/31/94
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 4 12
General Business Credit (11) (13)
Refund of prior
federal taxes (16) (7)
Revrersal of prior year deferred
tax provisions (10) (50) (10) (24)
Effective tax rate 15% (60)% 15% (19%)
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following table presents selected financial information for the periods
December 31, 1995 and 1994, respectively.
Three Months Ended Six Months Ended
December 31 December 31,
1995 1994 1995 1994
Net sales $970,077 $763,502 $1,671,837 $1,660,684
Gross profit $405,096 $242,432 $677,734 $565,836
Gross margin 41.7% 31.8% 40.5% 34.1%
Operating expenses $291,782 $235,657 $484,189 $473,165
Legal settlement income - - - -
Loss on disposal of fixed
assets - -
Net income (loss )$78,620 ($8,062) $128,674 $50,246
General
Logitek, Inc. (the "Company") reported a profit of $128,674 for the six
months ended December 31,1995 versus a profit of $50,246 for the prior year
period.For the quarter ended December 31, 1995 the Company reported a profit
of $78,620 compared to a loss of ($8,062) for the prior year quarter.
Results of Operations
Net sales for the first six months of fiscal 1995 were $1,671,837 compared
to $1,660,684, or an increase of $11,153. Net sales for the quarter ended
December 31, 1995 were $970,077 compared to $763,502 or an increase of
$206,575.
Gross profit increased to 40.5% in the current six month period compared
to 34.1% for the prior year.
Operating expenses for the six months ended December 31, 1995 increased
$11,024.
Liquidity
As of December 31, 1995 and June 30, 1995 the Company had cash on hand of
$96,585 and $139,751, respectively; and, as of December 31, 1995 the
Company's current ratio was 1.83 compared to 1.90 as of June 30, 1995.
Total borrowings were $749,379 at December 31, 1995, and $758,579 at
June 30, 1995. This represents a decrease of $9,200.
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. Submission of Matters to a Vote of Security Holders
At the Company's regularly scheduled Annual Meeting held on
November 22, 1994 the following votes were recorded:
1. To elect a partial board of two directors, each to serve for a
term of one year or until his successor shall have been duly
elected and qualified:
Votes Cast
For Against Abstained
Herbert L. Fischer 2,316,236 2,300 14,840
Howard Fein 2,278,001 2,300 14,840
Frank Vucci 2,272,988 2,000 14,840
2. To elect Marcum & Kliegman, Certified Public Accountants as the
Company's Independent certified accountants:
Votes Cast
For Against Abstained
2,310,001 8,700 10,200
Item 6. 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: 2/ 10 / 96 By: /s/ Herbert L. Fischer
Herbert L. Fischer
President and
Chief Executive Officer
<PAGE>
SIGNATURES
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<FISCAL-YEAR-END> JUN-30-1996
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<RECEIVABLES> 586,430
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<INVENTORY> 931,036
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<PP&E> 712,737
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0
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<TOTAL-COSTS> 994,103
<OTHER-EXPENSES> 484,189
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 42,271
<INCOME-PRETAX> 151,274
<INCOME-TAX> 22,600
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<NET-INCOME> 128,674
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