<PAGE>
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1995
Commission File No. 0-16335
OZO DIVERSIFIED AUTOMATION, INC.
7450 East Jewell Avenue, Suite A
Denver, Colorado 80231
Telephone: (303) 368-0401
Colorado 84-0922701
- - - ------------------------ ---------------------------------------
(State of Incorporation) (IRS Employer Identification No.)
Indicate by check mark 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 September 30, 1995 Registrant had 452,664 shares of its $.10 par value
common stock outstanding.
1
<PAGE>
PART I - FINANCIAL INFORMATION
OZO Diversified Automation, Inc.
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
------------ ------------
(Unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash $ 37,546 $ 47,111
Accounts and notes receivable, net
of allowance for doubtful accounts
of $5000 (1994 & 1995) 293,495 197,909
Inventories (Note 3) 432,799 254,091
Prepaid expenses 7,000 17,385
Other 2,697 0
-------- --------
Total Current Assets 773,537 516,496
-------- --------
PROPERTY AND EQUIPMENT
Manufacturing 160,185 159,543
Furniture and fixtures 112,509 112,509
Capitalized Lease 41,554 41,554
Vehicle 10,820 10,820
-------- --------
325,068 324,426
Less accumulated depreciation 310,816 299,443
-------- --------
Total Property and Equipment 14,252 24,983
-------- --------
OTHER ASSETS
Notes Receivables, net of current portion 2,215
Deferred Financing Costs 26,637 32,507
-------- --------
Total Assets $814,426 $576,201
-------- --------
-------- --------
</TABLE>
See notes to financial statements
2
<PAGE>
PART I - FINANCIAL INFORMATION (CONTINUED)
OZO DIVERSIFIED AUTOMATION, INC.
BALANCE SHEETS (CONTINUED)
LIABILITIES AND SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
------------ ------------
(UNAUDITED)
<S> <C> <C>
CURRENT LIABILITIES
Current portion of notes payable $ 21,357 $ 17,568
Accounts payable and accrued expenses 462,632 150,613
Line of credit 29,460 0
----------- -----------
Total Current Liabilities 513,449 168,181
----------- -----------
OTHER LIABILITIES
Notes Payable, net of current portion 240,000 255,936
----------- -----------
Total Liabilities 753,449 424,117
----------- -----------
SHAREHOLDERS' EQUITY
Preferred stock, $.10 par value authorized
1,000,000 shares issued - none
Common stock, $.10 par value authorized,
5,000,000 shares issued and outstanding -
452,664 shares (1995)
452,664 shares (1994) 45,261 45,261
Capital in excess of par value 1,169,809 1,169,809
Accumulated deficit (1,154,093) (1,062,986)
----------- -----------
Total Shareholders' Equity 60,977 152,084
----------- -----------
Total Liabilities & Stockholders' Equity $ 814,426 $ 576,201
----------- -----------
----------- -----------
</TABLE>
See notes to financial statements
3
<PAGE>
OZO DIVERSIFIED AUTOMATION, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
------------------------
1995 1994
---------- ---------
<S> <C> <C>
Net Sales $1,355,392 $ 919,083
Cost of Sales 699,164 501,355
---------- ---------
Gross Profit 656,228 417,728
Operating Expenses:
Marketing & Sales 256,742 184,720
Research & Development 122,982 155,795
General and Administrative 367,611 312,505
---------- ---------
747,335 653,020
---------- ---------
Income (loss) before taxes (91,107) (235,292)
NET INCOME (LOSS) $ (91,107) $(235,292)
---------- ---------
---------- ---------
EARNINGS (LOSS) PER COMMON SHARE $ (0.20) $ (0.60)
---------- ---------
---------- ---------
</TABLE>
See notes to financial statements
4
<PAGE>
OZO DIVERSIFIED AUTOMATION, INC.
STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-------------------------
1995 1994
--------- ---------
<S> <C> <C>
Cash flows from operating activities:
Net Income (loss) $ (91,107) $(235,292)
Adjustments to reconcile net loss to net cash used in operating
activities:
Depreciation 11,373 18,105
Amortization of deferred financing costs 5,870 7,370
Decrease (increase) in assets:
Accounts receivable (93,371) 65,407
Inventories (178,708) (129,446)
Prepaid expenses 10,385 7,971
Other (2,697) (2,697)
Increase (decrease) in accounts payable and accrued expenses 341,480 9,831
--------- ---------
Total adjustments 94,332 (23,459)
--------- ---------
Net cash used in operating activities 3,225 (258,751)
--------- ---------
Cash flows from investing activities:
Capital Expenditures (642) (16,861)
--------- ---------
Net cash provided (used) in investing activities (642) (16,861)
--------- ---------
Cash flows from financing activities:
Increase (decrease) in notes payable (12,148) (17,381)
Proceeds from issuance of common stock (0) 37,500
--------- ---------
Net cash provided (used) by financing activities (12,148) 20,119
--------- ---------
Net increase (decrease) in cash (9,565) (255,493)
Cash at beginning of period 47,111 277,261
--------- ---------
Cash at end of period $ 37,546 $ 21,768
--------- ---------
--------- ---------
</TABLE>
See notes to financial statements
5
<PAGE>
OZO DIVERSIFIED AUTOMATION, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended
September 30,
----------------------
1995 1994
-------- ---------
<S> <C> <C>
Net Sales $576,672 $ 136,146
Cost of Sales 280,767 69,986
-------- ---------
Gross Profit 295,905 66,160
Operating Expenses:
Marketing & Sales 127,809 54,434
Research & Development 38,659 36,820
General and Administrative 132,753 119,897
-------- ---------
299,221 211,151
-------- ---------
Income (loss) before taxes (3,316) (144,991)
-------- ---------
NET INCOME (LOSS) $ (3,316) $(144,991)
-------- ---------
-------- ---------
EARNINGS (LOSS) PER COMMON SHARE $ (0.01) $ (0.37)
-------- ---------
-------- ---------
</TABLE>
See notes to financial statements
6
<PAGE>
OZO DIVERSIFIED AUTOMATION, INC.
NOTES TO FINANCIAL STATEMENTS
NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(UNAUDITED)
In the opinion of management of OZO Diversified Automation, Inc. (the Company),
the accompanying unaudited financial statements reflect all adjustments
(consisting only of normal recurring accruals) necessary to present fairly the
financial position of the Company as of September 30, 1995 and the results of
operations and changes in financial position for the nine months ended
September 30, 1995.
The results of operations for the nine months ended September 30, 1995 are not
necessarily indicative of the results that may be expected for the year ending
December 31, 1995.
These unaudited financial statements should be read in conjunction with the
Company's annual report on Form 10-KSB for the year ended December 31, 1994.
NOTE 1 - A summary of significant accounting policies is currently on file
with the Securities and Exchange Commission on Form 10-KSB.
NOTE 2 - Income Taxes:
At December 31, 1994, the Company had net operating loss carryforwards
totaling approximately $913,000 that may be offset against future
taxable income through 2009 and research and development credits of
approximately $33,000 expiring through 2009.
The Company has fully reserved the tax benefits of these operating
losses because the likelihood of realization of the tax benefits
cannot be determined. These carryforwards are subject to review by
the Internal Revenue Service.
Temporary differences between the time of reporting certain items for
financial and tax reporting purposes, primarily from using different
methods of reporting depreciation costs and warranty and vacation
accruals, are not considered significant by management of the Company.
NOTE 3 - Inventories:
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
------------- ------------
<S> <C> <C>
Raw Materials $ 332,603 $ 180,720
Work in process 32,006 20,256
Finished Goods 68,190 53,115
------------- ------------
$ 432,799 $ 254,091
------------- ------------
------------- ------------
</TABLE>
7
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
For the first nine months ended September 30, 1995, the Company had revenues of
$1,355,392, a 47% increase from revenues of $919,083 for the comparable period
in 1994. During the quarter ended September 30, 1995, the Company had revenues
of $576,672, a 324% increase over revenues of $136,146 for the comparable
period in 1994.
The loss for the nine months ended September 30, 1995 was $91,107, compared
with a loss of $235,292 for the comparable period in 1994. The loss for the
quarter was $3,316 compared to a loss of $144,991 in 1994. Working capital,
although limited, is expected to be adequate to fund operations and order
backlogs. Third quarter 1995 revenues were offset by higher development costs
of the new depaneling products, precipitating higher warranty expense. Rising
prices of vendor parts, higher inventories, rising prices of air travel for
scheduled equipment installation and sales activities, and added staff for
quality control and customer service also contributed to increases in costs.
Management has continued focused marketing efforts in the depaneling
application, with participation in the Surface Mount International trade show
in August 1995 and completion of a depaneling product video in July 1995. As of
November 7, 1995, the Company had a backlog of current open orders of
approximately $625,000. The Company's new depaneling products account for 78%
of the current backlog.
8
<PAGE>
PART II - OTHER INFORMATION
---------------------------
OZO Diversified Automation, Inc.
Items 1-5 Not Applicable.
Item 6 Exhibits and Reports on Form 8-K
--------------------------------
a) Exhibits - none.
b) No Reports on Form 8-K were filed during the quarter
ending September 30, 1995
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.
OZO DIVERSIFIED AUTOMATION, INC.
By: Marjorie Zimdars-Orthman
--------------------------------
Marjorie Zimdars-Orthman
Principal Executive Officer
Principal Financial Officer
Dated: November 9, 1995
9
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 37,546
<SECURITIES> 0
<RECEIVABLES> 293,495
<ALLOWANCES> 0
<INVENTORY> 432,799
<CURRENT-ASSETS> 773,537
<PP&E> 352,068
<DEPRECIATION> 310,816
<TOTAL-ASSETS> 814,426
<CURRENT-LIABILITIES> 513,449
<BONDS> 240,000
<COMMON> 45,261
0
0
<OTHER-SE> 15,716
<TOTAL-LIABILITY-AND-EQUITY> 814,426
<SALES> 1,355,392
<TOTAL-REVENUES> 1,355,392
<CGS> 699,164
<TOTAL-COSTS> 699,164
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (91,107)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (91,107)
<EPS-PRIMARY> (.20)
<EPS-DILUTED> 0
</TABLE>
