UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10QSB
(X) Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended June 30, 2000
( ) Transition report pursuant of Section 13 or 15(d) of the Securities
Exchange Act of 1939 for the transition period ____ to______
COMMISSION FILE NUMBER 0-832975
NORTECH FOREST TECHNOLOGIES, INC.
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(Exact name of registrant as specified in its charter)
DELAWARE 06-1342912
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(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
2233 University Ave, Suite 225
St Paul, MN 55114
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(Address of Principal Executive Offices, including Registrant's zip code
and telephone number)
NONE
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Former name, former address and former fiscal year, if changed
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
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The number of shares of the registrant's common stock as of June 30, 2000:
8,084,354 shares.
Transitional Small Business Disclosure Format (check one): Yes No X
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TABLE OF CONTENTS
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
(a) Balance Sheet
(b) Statement of Income
(c) Statement of Cashflows
(d) Statement of Shareholders' Equity
(e) Notes to Financial Statements
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of Operations
Item 3. Risks
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Item 2. Changes in Securities and Use of Proceeds
Item 3. Defaults On Senior Securities
Item 4. Submission of Items to a Vote
Item 5. Other Information
Item 6
(a) Exhibits
(b) Reports on Form 8K
March 31, 2000
April 13, 2000 (amended)
SIGNATURES
FINANCIAL DATA SCHEDULE
[CAPTION]
Nortech Forest Technologies, Inc.
Balance Sheets - Unaudited
June 30, 2000 and December 31, 1999
Current Assets June 30, 2000 December 31, 1999
Cash in Bank 138,137 10,812
Accounts Receivable 220,813 203,922
Inventory for Resale 247,500 51,847
Prepaid Insurance and Expense 24,170 8,490
-------------- --------------
Total Current Assets 630,620 275,071
Fixed and Other Assets
Security Deposits 18,843 1,665
Equipment/Start Up Costs 711,615 64,283
Goodwill 748,655
Less Acc Depreciation/Amortization (232,947) (51,386)
Deferred Offering Costs 0 37,500
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Total Fixed and Other Assets 1,246,166 14,561
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Total Assets 1,876,786 327,132
============== ==============
Current Liabilities
Line of Credit
100,637
Accounts Payable 544,404 42,625
Accrued Expenses 119,663 18,527
-------------- --------------
664,067 161,789
Long Term Liabilities
N/P - Bank Financing 84,921 0
N/P - Equipment 671,009 27,256
N/P - Shareholders 145,100 0
-------------- --------------
Total Long Term Liabilities 901,030 27,256
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Total Liabilities 1,565,097 189,045
Equity
Common Stock 244,741 244,741
Subscription Receivable (727,500) (727,500)
Paid In Capital 2,547,869 2,585,369
Accumulated Deficit (1,753,421) (1,764,523)
-------------- --------------
Total Equity 311,689 138,087
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Total Liabilities and Equity 1,876,786 327,132
============== ==============
<TABLE>
<CAPTION>
NORTECH FOREST TECHNOLOGIES, INC.
STATEMENTS OF OPERATIONS
<S> <C> <C>
Six Months ended June 30
1999 2000
-------------------------
Sales $ 399,112 2,013,622
Cost of sales 139,310 680,138
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Gross profit 259,802 1,333,484
------------
Operating expenses:
Administrative expenses 111,718 728,023
Sales and marketing 97,980 -0-
------------
Total operating expenses 215,698 1,000,439
------------
Income from operations (76,388) 1,728,462
Other income and expense
interest income $ 780 544,641
interest expense $(12,077) $ (0)
------------ --------
Net profit (loss) $38,807 $149,663
Net profit (loss) per common share $0.011 $ 0.02
Outstanding shares of common stock 3,519,130 $ 8,084,354
</TABLE>
[CAPTION]
NORTECH FOREST TECHNOLOGIES, INC.
STATEMENTS OF CASH FLOWS
FOR THE PERIODS ENDED MARCH 31, 1999 AND 2000
<TABLE>
<S> <C> <C>
Six Months ended June 30
1999 2000
-------------------------
Cash flows from operating activities:
Net income (loss) (4) $48,446 $ 149,663
Adjustments to reconcile net income (loss) to net cash
flows from operating activities:
Amortization/Depreciation 2,431 181,560
Changes in operating assets and liabilities:
Accounts receivable (4,517) 16,891
Inventories 2,133 195,653
Prepaid expenses 0 27,025
Other assets 0 765,833
Accounts payable 12,454 501,779
Accrued expenses 8,797 101,136
Other expenses (1,179) 15,680
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Cash flows from operating activities 68,565 (209,582)
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Cash flows from investing activities: (1,605) -0-
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Cash flows from financing activities:
Net increase (decrease) in line of credit (27,502) (100,637)
Sale of Stock for Cash 0 61,439
Note payable other: (19,258) 873,774
Deferred offering costs: (4,430) -0-
Cash flows from financing activities (51,190)
-0-
--------
---------
Net increase (decrease) in cash (15,770)
127,326
Cash, beginning of period 18,479
10,812
Cash, end of period $34,249
$ 138,138
</TABLE>
NORTECH FOREST TECHNOLOGIES, INC.
NOTES TO FINANCIAL STATEMENTS
PERIOD ENDED JUNE 30 2000
1. CONDENSED FINANCIAL STATEMENTS
The financial statements included herein have been prepared by Nortech Forest
Technologies, Inc., without audit, pursuant to the rules and regulations of the
Securities Exchange Commission. Certain information and note disclosures
normally included in financial statements have been prepared in accordance with
generally accepted accounting principles have been condensed or omitted as
allowed by such rules and regulations. Nortech Forest Technologies, Inc.
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 December 31, 1999 audited financial statements and the
accompanying notes thereto.
Management of Nortech Forest Technologies, Inc. believes that the accompanying
financial statements contain all adjustments necessary to present fairly the
operations and cash flows for the periods presented.
2. SALE OF TREE GUARD ASSETS AND ACQUISITION OF FLORAL BUSINESS ASSETS
Sale of Tree Guard(R) Assets - On February 3, 2000, the Company sold all of the
assets, net of certain liabilities associates with its Tree Guard brand deer
repellant, including accounts receivable, inventories and certain prepaid
expenses for $850,000.
Acquisition of FL Floral, Inc. and FL Flowers, Inc. - On February 4, 2000, the
Company acquired 100% of the outstanding stock of FL Floral, Inc. and FL
Flowers, Inc. The Company issued 3,206,245 shares of common stock for these
acquisitions. The purchase agreement contains stock incentives based on future
sales up to a maximum of 6,412,474 shares of common stock. In conjunction with
the purchase, the Company entered into employment agreements with the two
previous owners of the Fl Floral, Inc. and FL Flowers, Inc. and a current
officer of the Company. The agreements require annual compensation ranging
between $36,000 and $87,500 expiring through December 2002.
PART I. FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
THIS ANALYSIS CONTAINS FORWARD-LOOKING COMMENTS WHICH ARE BASED ON CURRENT
INFORMATION. ACTUAL RESULTS IN THE FUTURE MAY DIFFER MATERIALLY.
The Company is engaged in the business of retail floral and gift sales from its
12 retail locations and its Internet web site. The Company discontinued a non-
profitable business of sales of animal repellent during the last quarter.
Results of Operations
Six months ended June 30, 1999 Compared to six months ended June 30, 2000
The net income for the six months ended June 30, 1999 was $149,663, compared
with a net income of $38,807 for the six months ended June 30, 2000. The primary
reasons for the increase in net income was the change of business of the
company.
The Company overall generated $2,013,622 in revenues in the six months ended
June 30, 2000, compared to revenues of $399,112 in the period ended June 30,
1999. Management attributes this increase to the change in business from animal
repellent sales to floral sales.
Liquidity and Capital Resources
At June 30, 1999, the Company had a working capital surplus of $86,026, as
compared to a working capital surplus of $12,553 on June 30, 2000. The increase
in capital is attributed to the acquisition of additional retail outlets.
The Company does not anticipate that it will have any problems in meeting its
obligations for continuing fixed expenses, materials procurement or
operating labor.
PART II. OTHER INFORMATION
Item 1. Legal proceedings NONE
Item 2. Changes in securities and use of proceeds NONE
Item 3. Defaults on senior securities NONE
Item 4. Submission of items to a vote NONE
Item 5. Other information NONE
Item 6.
a) Exhibits NONE
b) Reports on 8K
March 31, 2000
April 13, 2000
SIGNATURES
In accordance with the requirements of the Securities and Exchange Act of 1934,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Nortech Forest Technologies, Inc.
Dated: August 28, 2000 By: DON LINDSTEDT
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DON LINDSTEDT, C.E.O.
[TYPE]EX-27
<SEQUENCE>2
[DESCRIPTION]FINANCIAL DATA SCHEDULE
[ARTICLE] 5
[MULTIPLIER] 1
[PERIOD-TYPE] 6-MOS
[FISCAL-YEAR-END] DEC-31-1999
[PERIOD-START] JAN-1-2000
[PERIOD-END] JUN-31-2000
[CASH] 138,137
[SECURITIES] 0
[RECEIVABLES] 220,813
[ALLOWANCES] 0
[INVENTORY] 293,500
[CURRENT-ASSETS] 676,620
[PP&E] 602,724
[DEPRECIATION] 181,560
[TOTAL-ASSETS] 1,876,786
[CURRENT-LIABILITIES] 664,067
[BONDS] 0
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[COMMON] 244,741
[OTHER-SE] 0
[TOTAL-LIABILITY-AND-EQUITY] 1,876,786
[SALES] 2,013,622
[TOTAL-REVENUES] 2,013,622
[CGS] 680,138
[TOTAL-COSTS] 680,138
[OTHER-EXPENSES] 1,728,462
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 0
[INCOME-PRETAX] 149,663
[INCOME-TAX] 0
[INCOME-CONTINUING] 149,663
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] 149,663
[EPS-BASIC] .02
[EPS-DILUTED] .02
