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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 December 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 February 9, 1998 12,214,632 shares of registrant's common stock (par value,
$.01) were outstanding.
Transitional small business disclosure format YES NO X
<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 December 31, 1997 (Unaudited)
and September 30, 1997 (Audited) 3
Condensed Income Statements (Unaudited) for the Three-Months
ended December 31, 1997 and December 31, 1996 4
Condensed Statements of Cash Flows (Unaudited) for the Three-
Months ended December 31, 1997 and December 31, 1996 5
Notes to Condensed Financial Statements (Unaudited) 6
Item 2. Management's Discussion and Analysis or
Plan of Action 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>
W-J International, Ltd.
Balance Sheet
<TABLE>
<CAPTION>
December 31, September 30,
1997 1997
(Unaudited) (Audited)
----------- -----------
A S S E T S
<S> <C> <C>
Current Assets:
Cash / Cash Equivalents $ 181,732 $ 188,593
----------- -----------
Total current assets 181,732 188,593
----------- -----------
Property and equipment:
Land 30,648 30,648
Buildings 374,266 374,266
----------- -----------
404,914 404,914
Less: accumulated depreciation (114,453) (110,655)
----------- -----------
Net property and equipment 290,461 294,259
----------- -----------
Total Assets $ 472,193 $ 482,852
=========== ===========
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 $ 26,400 $ 23,782
Accrued liabilities 396 396
----------- -----------
Total current liabilities 26,796 24,178
----------- -----------
Long-term debt, net of current portion 50,882 56,200
----------- -----------
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 (2,002,471) (1,994,512)
----------- -----------
Total stockholders equity 394,515 402,474
----------- -----------
Total liabilities and stockholders equity $ 472,193 $ 482,852
=========== ===========
</TABLE>
See notes to financial statements
3
<PAGE>
W-J International, Ltd.
Statement of Operations
<TABLE>
<CAPTION>
Three Months Ended
December 31,
1997 1996
(Unaudited) (Unaudited)
<S> <C> <C>
Rental Income: $ 3,000 $ 28,200
Expenses:
General & Administrative 11,373 9,852
Interest (414) 2,214
------------ ------------
10,959 12,066
------------ ------------
Income (loss) from continuing operations
before discontinued operations (7,959) 16,134
Discontinued Operations:
Loss from discontinued operations 0 (2,587)
Net Income (loss) (7,959) 13,547
============ ============
Weighted average common shares outstanding during period 12,214,632 12,214,632
============ ============
Net (loss) per share ($ 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
December 31,
CASH FLOWS FROM OPERATING ACTIVITIES 1997 1996
(Unaudited) (Unaudited)
-----------------------
<S> <C> <C>
Net (Loss) ($ 7,959) $ 13,547
Adjustments to reconcile net (loss) to net cash
flows from operating activities:
Depreciation 3,798 3,798
Changes in:
Accounts receivables - Trade
Accounts receivables - Related parties 0 0
Prepaid expenses 6,300 0
Notes payables - Trade 0 27,323
Notes payables - Related parties 0 (38,600)
Accrued expenses 0 0
--------- ---------
Net cash flows from operating activities (10,461) 6,068
--------- ---------
Cash flows from investing activities:
Purchase of property and equipment 0 0
Net cash flows from investing activities 0 0
--------- ---------
Cash flows from financing activities:
Gain on extinguishment of debt 0 0
Principal payments on long-term debt (2,700) (4,051)
--------- ---------
Net cash flows from financing activities (2,700) (4,051)
--------- ---------
Net increase (decrease) in cash (13,161) 2,017
Cash, beginning of year 188,593 209,841
--------- ---------
Cash, end of year $ 175,432 $ 211,858
========= =========
</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 December 31, 1997 (Unaudited) and
September 30, 1997 (Audited) and the related statement of operations
and cash for the three-month period ended December 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-Q 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:
December 31, September 30,
1997 1997
---------- ----------
Parts and Components $ 0 $ 0
Finished Units 0 0
---------- ----------
========== ==========
Total $ 0 $ 0
========== ==========
Note 3. STOCKHOLDERS' EQUITY
(Audited) Equity Changes (Unaudited)
September 30, Due to Operation December 31,
1997 1997
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) (1,994,512) (7,959) (2,002,471)
Total 402,474 (7,959) 394,515
6
<PAGE>
Item 2 - Management's Discussion and Analysis or Plan of Operation
RESULTS OF OPERATIONS
Rental Income for the first three month period December 31,
1997 decreased to $3,000 from $28,200 for the three-month period
December 31, 1996. The decrease in rent for the first quarter for
fiscal 1997 as compared to the same quarter of fiscal 1996 was
primarily due to the fact that the one-year lease agreement that the
Company had with one of its lessees was not extended beyond its March
31, 1997 termination date. The Company has not yet replaced this
renter, and rental income is the Company's only source of income at
this time.
Expenses for the first three-month period ended December 31,
1997 decreased 9.1% to $10,959 from $12,066 for the three-month period
ended December 31, 1996.
The Company experienced no loss or gain from discontinued
operations for the three-month period ended December 31, 1997 as
compared to a loss of $2,587 in the three-month period ended December
31, 1996.
The Company's net deficit for the three-month period ended
December 31, 1997 was $7,959 as compared to a net profit of $13,547 for
the same period ended December 31, 1996. This significant change from
1996 arises from the Company's inability to secure a renter for its
building.
LIQUIDITY AND CAPITAL RESOURCES AND PLAN OF OPERATION
The Company's working capital decreased to $154,936 as of
December 31, 1997 from $164,415 at September 30, 1997. The Company
intends to continue to seek and evaluate alternatives in order to begin
operations again and to improve the Company's financial condition,
including merger and acquisition opportunities. In the interim, the
Company will seek a renter or purchaser for its building. Because the
Company will not restart operations of any type until a business
opportunity arises for such, it does not anticipate raising additional
funds and believes it has sufficient means to meet its capital
requirements for fiscal year 1998.
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 December 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 December 31, 1997.
(b) Reports on Form 8-K.
No report on Form 8-K was filed during the three-month period
ended December 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: February 13, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> DEC-31-1997
<EXCHANGE-RATE> 1
<CASH> 175,432
<SECURITIES> 0
<RECEIVABLES> 6,300
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 181,732
<PP&E> 404,914
<DEPRECIATION> 114,453
<TOTAL-ASSETS> 472,193
<CURRENT-LIABILITIES> 26,796
<BONDS> 0
0
0
<COMMON> 122,146
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 472,193
<SALES> 0
<TOTAL-REVENUES> 3,000
<CGS> 0
<TOTAL-COSTS> 10,959
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (414)
<INCOME-PRETAX> (7,959)
<INCOME-TAX> 0
<INCOME-CONTINUING> (7,959)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (7,959)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
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