FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
-------------------- ---------------------
Commission File Number 0-17345
W-J International, Ltd.
(Exact name of small business issuer as specified in its charter)
Delaware 41-1578316
(State of other jurisdiction of (I.R.S. Employer
organization) Identification No.)
23 Washburne Avenue
Paynesville, Minnesota 56362
(Address of principal executive offices)
612-243-3311
(Registrant's telephone number, including area code)
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 [ ]
At May 1, 1997 12,214,632 shares of registrant's common stock (par value, $.01)
were outstanding.
Transitional Small Business Disclosure Format: Yes [ ] No [ X ]
This report contains 8 pages.
<PAGE>
W-J International, Ltd.
QUARTERLY REPORT ON FORM 10-QSB
INDEX
Page Number
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets as of March 31, 1997 (Unaudited)
and September 30, 1996 3
Condensed Income Statements (Unaudited)
Three and Six-Months ended March 31, 1997 and March 31, 1996 4
Condensed Statements of Cash Flows (Unaudited)
Three and Six-Months ended March 31, 1997 and March 31, 1996 5
Notes to Condensed Financial Statements (Unaudited) 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 7
Item 6. Exhibits and Reports on Form 8-K 7
SIGNATURES 8
<PAGE>
Part I. Financial Information
Item 1. Financial Statements
W-J International, Ltd.
Balance Sheet
<TABLE>
<CAPTION>
March 31, September 30,
1997 1996
(Unaudited) (Audited)
----------- -----------
A S S E T S
<S> <C> <C>
Current Assets:
Cash and Cash equivalents $ 31,761 $ 19,708
Certificates of Deposit $ 165,897 $ 190,133
Receivables $ 2,007 $ 0
----------- -----------
Total current assets 199,665 209,841
----------- -----------
Property and equipment:
Land 30,648 30,648
Buildings 374,266 374,266
----------- -----------
404,914 404,914
Less: accumulated depreciation (106,178) (98,582)
----------- -----------
Net property and equipment 298,736 306,332
----------- -----------
Total Assets $ 498,401 $ 516,173
=========== ===========
L I A B I L I T I E S A N D E Q U I T Y
Current liabilities:
Current portion of long-term debt $ 16,200 $ 20,936
Accrued expenses 91 3,638
Due to related parties 0 26,400
Notes payable - related parties 0 9,647
----------- -----------
Total current liabilities 16,291 60,621
----------- -----------
Long-term debt, net of current portion 75,630 78,994
----------- -----------
Stockholders equity:
Common stock, $.01 par value; 20,000,000
shares authorized, 12,214,632
shares issued and outstanding 122,146 122,146
Additional paid-in capital 2,274,840 2,274,840
Accumulated deficit (1,990,506) (2,020,428)
----------- -----------
Total stockholders equity 406,480 376,558
----------- -----------
Total liabilities and
stockholders equity $ 498,401 $ 516,173
=========== ===========
</TABLE>
See notes to financial statements
3
<PAGE>
W-J International, Ltd.
Statements of operations
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
March 31, March 31,
1997 1996 1997 1996
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Rental Income: $ 28,200 $ 20,489 $ 56,400 $ 40,978
Expenses:
General & Administrative 3,819 (1,342) 13,671 4,124
Interest 1,237 1,989 3,451 4,897
------------ ------------ ------------ ------------
5,056 647 17,122 9,021
------------ ------------ ------------ ------------
Income from continuing operations before
discontinued operations 23,144 19,842 39,278 31,957
Discontinued Operations:
Discontinued Operations (6,769) (11,065) (9,356) (17,551)
Loss from discontinued operations and extraordinary item (6,769) (11,065) (9,356) (17,551)
Net Income 16,375 8,777 29,922 14,406
============ ============ ============ ============
Weighted average common shares outstanding
during period 12,214,632 12,214,632 12,214,632 12,214,632
============ ============ ============ ============
Net Income per share $ 0.00 $ 0.00 $ 0.00 $ 0.00
============ ============ ============ ============
</TABLE>
See notes to financial statements
4
<PAGE>
W-J International, Ltd.
Statement of Cash Flows
Increase (Decrease) in Cash
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
March 31, March 31,
CASH FLOWS FROM OPERATING ACTIVITIES 1997 1996 1997 1996
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
---------------------- ----------------------
<S> <C> <C> <C> <C>
Net Income $ 16,375 $ 8,777 $ 29,922 $ 14,405
Adjustments to reconcile net income to net cash flows
from operating activities:
Depreciation 3,798 3,798 $ 7,596 7,596
Changes in:
Notes payables - Trade (2,007) 0 25,316 0
Notes payables - Related parties (993) (2,654) (39,593) (31,926)
Accrued expenses (27,323) (4,620) (27,323) (923)
--------- --------- --------- ---------
Net cash flows from operating activities (10,150) 5,301 (4,082) (10,848)
--------- --------- --------- ---------
Cash flows from investing activities:
Purchase of property and equipment 0 0 0 0
Net cash flows from investing activities 0 0 0 0
--------- --------- --------- ---------
Cash flows from financing activities:
Principal payments on long-term debt (4,050) (6,000) (8,101) (10,426)
--------- --------- --------- ---------
Net cash flows from financing activities (4,050) (6,000) (8,101) (10,426)
--------- --------- --------- ---------
Net increase (decrease) in cash (14,200) (699) (12,183) (21,274)
Cash, beginning of year 211,858 317,783 209,841 338,358
--------- --------- --------- ---------
Cash, end of year $ 197,658 $ 317,084 $ 197,658 $ 317,084
========= ========= ========= =========
</TABLE>
See notes to financial statements
5
<PAGE>
W-J International, Ltd.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The condensed balance sheet as of March 31, 1997 (Unaudited) and
September 30, 1996 (Audited) and the related statement of operations
and cash flow for the three and six-month periods ended March 31,
1997 (Unaudited) are enclosed. In the opinion of management, all
adjustments necessary for a fair presentation of such financial
statements have been included. Such adjustments consisted only of
normal recurring items.
The Financial statements and notes are presented as permitted by Form
10-QSB and contain certain information included in the Company's
annual financial statements and notes of W-J International, Ltd., a
Delaware Corporation ("W-J" or the "Company").
Note 2. INVENTORIES
Inventories consist of the following:
March 31, September 30,
1997 1996
---------- -----------
Parts and Components $ 0 $ 0
Finished Units 0 0
---------- -----------
========== ===========
Total $ 0 $ 0
========== ===========
Note 3. STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
(Audited) Equity Changes (Unaudited)
September 30, Due to Operation March 31,
1996 1997
<S> <C> <C> <C>
Number of Shares 12,214,632 0 12,214,632
Common Stock 122,146 0 122,146
Additional Paid-In Capital 2,274,840 0 2,274,840
Retained Earnings
(Accumulated Deficit) (2,020,428) 29,922 (1,990,506)
Total 376,558 29,922 406,480
</TABLE>
6
<PAGE>
Item 2 - Management's Discussion and Analysis of Results of Operations and
Financial Condition.
RESULTS OF OPERATIONS
Rental Income for the six-month period ended March 31, 1997
increased 38% to $56,400 from $40,978 for the six-month period March
31, 1996. Rental Income for the three-month period ended March 31, 1997
increased 38% to $28,200 from $20,489 for the three-month period ended
March 31, 1996. The increase in rent for the three-month and six-month
periods ended March 31, 1997 as compared to the three-month and
six-month periods ended March 31, 1996 was primarily due to the tenant
renting additional square footage.
Expenses for the six-month period ended March 31, 1997
increased 90% to $17,122 from $9,021 for the six-month period March 31,
1996. Expenses for the three-month period ended March 31, 1997
increased 680% to $5,056 from $647 for the three-month period ended
March 31, 1996. The increase in expenses for the six-month and
three-month periods ended March 31, 1997 as compared to the same
periods in 1996 was related to a reclassification of expenses in the
three-month period ended March 31, 1996.
Discountinued Operation expenses for the six-month period
ended March 31, 1997 was $9,356 while expenses for the three-month
period ended March 31, 1997 was $6,769.
Net Income for the six-month period ended March 31, 1997
increased 107% to $29,922 from $14,405 for the six-month period March
31, 1996. Net Income for the three-month period ended March 31, 1997
increased 87% to $16,375 from $8,777 for the three-month period ended
March 31, 1996. The increase in Net Income for the three-month and
six-month periods ended March 31, 1997 as compared to the three-month
and six-month periods ended March 31, 1996 was primarily related to
decreasing discontinued operation expenses.
LIQUIDITY AND CAPITAL RESOURCES
The Company's working capital increased to $183,374 at March
31, 1997 from $149,220 as of September 30, 1996.
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders.
No matters were submitted to a vote of security holders during the
quarter ended March 31, 1997.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
No exhibits are required to be filed for the three-month
period ended March 31, 1997, except Exhibit 27 (Financial Data Schedule) has
been included in the electronic version only.
(b) Reports on Form 8-K.
No report on Form 8-K was filed during the three-month
period ended March 31, 1997.
7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Issuer
has duly caused this report to be signed on its behalf by the undersigned
hereunto duly authorized.
W-J International, Ltd.
("Small Business Issuer")
By /s/ Edward H. Webb
Edward H. Webb
President
Date: May 1, 1997
8
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from
second quarter Form 10-QSB and is qualified in its entirety by reference
to such financial statements.
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> OCT-01-1996
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 1
<CASH> 197,658
<SECURITIES> 0
<RECEIVABLES> 2,007
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 199,665
<PP&E> 404,914
<DEPRECIATION> 106,178
<TOTAL-ASSETS> 498,401
<CURRENT-LIABILITIES> 16,291
<BONDS> 0
0
0
<COMMON> 122,146
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 498,401
<SALES> 0
<TOTAL-REVENUES> 28,200
<CGS> 0
<TOTAL-COSTS> 3,819
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,237
<INCOME-PRETAX> 23,144
<INCOME-TAX> 0
<INCOME-CONTINUING> 23,144
<DISCONTINUED> 6,769
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 16,375
<EPS-PRIMARY> .00
<EPS-DILUTED> .00
</TABLE>
