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 SEPTEMBER 30, 1999
( ) 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 March 31, 2000:
8,084,354 shares.
Transitional Small Business Disclosure Format (check one): Yes No X
--- ---
TABLE OF CONTENTS
-----------------
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
March 31, 2000(unaudited) and December 31, 1999
<TABLE>
December
31, March 31,
1999
2000
----------- ----------
<S> <C>
<C>
ASSETS
Current assets:
Cash $
10,812 $ 403,043
Accounts receivable
203,992 317,545
Inventories
51,847 284,000
Prepaid expenses
8,490 27,025
----------- -----------
Total current assets
275,071 1,031,613
----------- -----------
Property and equipment
Furniture and equipment, net
12,896 549,444
--------- ---------
Total property and equipment
12,896 549,444
Other assets:
Deferred offering costs
37,500 0
Goodwill
0 333,655
Security Deposit/Start up costs
1,665 77,957
----------- -----------
Total other assets
39,165 411,612
Total Assets $
327,132 $ 1,992,669
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current liabilities:
Current portion of long-term debt $
100,637 $ 0
Line-of-credit
27,256 0
Accounts payable
42,625 418,380
Taxes payable
0 16,318
Accrued wages
0 48,640
Accrued expenses
18,527 47,395
----------- -----------
Total current liabilities
189,045 530,733
----------- -----------
Long-term debt, net of current portion
0 823,648
----------- -----------
Total liabilities
189,045 1,354,381
----------- -----------
Stockholders' equity:
Preferred stock, par value $.01 per share, 500,000 shares
authorized; none issued and outstanding
0 0
Common stock, par value $.01 per share, 15,000,000 shares
authorized, 4,474,130 shares issued
and outstanding
44,741 244,741
Additional paid-in capital
2,585,369 2,585,369
Subscriptions receivable
(727,500) ( 765,000) Accumulated deficit
(1,764,523) (1,849,142)
Net income
0 422,320
----------- ----------
Total stockholders' equity
138,087 638,288
----------- -----------
Total liabilities and equity $
327,132 $1,992,669
=========== ===========
</TABLE>
<PAGE> F-2
[CAPTION]
NORTECH FOREST TECHNOLOGIES, INC.
STATEMENTS OF OPERATIONS
<TABLE>
March 31,
March 31,
1999
2000
-----------
-----------
<S> <C>
<C>
Sales $ 164,856
$ 918,704
Cost of sales 67,646
324,050
-----------
-----------
Gross profit 97,210
594,654
-----------
-----------
Operating expenses:
Administrative expenses 57,118
706,833
Sales and marketing 42,765
114,653
-----------
-----------
Total operating expenses 99,883
821,486
-----------
-----------
Income from operations (2,673)
(226,832)
Other income (expense):
Interest expense (7,059)
(21,264)
Interest income 94
0
Other income 0
7,142
Sale of Tree Guard assets 749,488
Marketing - Mall of America
(21,251)
Depreciation (25,591)
Prior year adjustments (39,370)
-----------
-----------
Total other income (expense) $ (7,153)
$ 649,154
===========
===========
Net income (loss) before income taxes (9,638)
422,322
Provision for income taxes 0
0
Net income (loss) $ ( 9,638)
$ 422,322
===========
===========
Basic and diluted earnings (loss) per common share $ (0.01)
$ .05
===========
===========
Outstanding shares of common stock 4,474,130
8,084,354
</TABLE>
[CAPTION]
NORTECH FOREST TECHNOLOGIES, INC.
STATEMENTS OF CASH FLOWS
FOR THE PERIODS ENDED MARCH 31, 1999 AND 2000
<TABLE>
March 31
-------------------------
1999 2000
--------- ---------
<S>
<C> <C>
Cash flows from operating activities:
Net income (loss) $(
9,638) $422,322
Adjustments to reconcile net income (loss) to net cash
flows from operating activities:
Depreciation
2,432 39,370
Changes in operating assets and liabilities:
Accounts receivable
(6,686) 403,043
Inventories
23,263 284,000
Prepaid expenses
0 27,025
Other assets
39,165 411,612
Accounts payable
(9,932) 418,380
Accrued expenses
(2,475) 47,395
-------------------------
Cash flows from operating activities (
920) 1,169,133
-------------------------
Cash flows from investing activities:
Purchase of furniture and equipment
0 0
Net cash flows from investing activities
0 0
--------- ---------
Cash flows from financing activities:
Net increase (decrease) in line of credit
6,152 0
Payments of long-term debt
0 0
--------- ---------
Cash flows from financing activities
6,152 0
--------- ---------
Net increase (decrease) in cash
(12,393)
Cash, beginning of period
30,874 10,812
Cash, end of period $
10,812 $ 30,874
========= =========
Supplemental cash flows information:
</TABLE>
[CAPTION]
NORTECH FOREST TECHNOLOGIES, INC.
NOTES TO FINANCIAL STATEMENTS
PERIOD ENDED MARCH 31, 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
Three months ended March 31, 1999 Compared to three months ended March 31,
2000.
The net loss for the three months ended March 31, 1999 was $9,638, compared
with a net income of $422,320 for the three months ended march 31, 2000.
The primary reasons for the increase in net income was the sale of the Tree
Guard assets.
The Company overall generated $918,704 in revenues in the three months
ended March 31, 2000, compared to revenues of $164,856 in the period ended
March 31, 1999. Management attributes this increase to the change in
business from animal repellent sales to floral sales.
Liquidity and Capital Resources
At March 31, 1999, the Company had a working capital surplus of $86,026, as
compared to a working capital surplus of $500,880 on March 31, 2000. The
increase in capital is attributed to the acquisition of FL Floral and FL
Flowers assets.
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: June 4, 2000 By: DON LINDSTEDT
---------------------------
DON LINDSTEDT, C.E.O.
[TYPE]EX-27
<SEQUENCE>2
[DESCRIPTION]FINANCIAL DATA SCHEDULE
[ARTICLE] 5
[MULTIPLIER] 1
[PERIOD-TYPE] 3-MOS
[FISCAL-YEAR-END] DEC-31-1999
[PERIOD-START] JAN-1-2000
[PERIOD-END] MAR-31-2000
[CASH] 403,043
[SECURITIES] 0
[RECEIVABLES] 317,545
[ALLOWANCES] 0
[INVENTORY] 284,000
[CURRENT-ASSETS] 1,031,613
[PP&E] 27,025
[DEPRECIATION] 25,591
[TOTAL-ASSETS] 1,992,669
[CURRENT-LIABILITIES] 530,733
[BONDS] 0
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[COMMON] 244,741
[OTHER-SE] 0
[TOTAL-LIABILITY-AND-EQUITY] 1,992,669
[SALES] 918,704
[TOTAL-REVENUES] 918,704
[CGS] 324,050
[TOTAL-COSTS] 324,050
[OTHER-EXPENSES] 649,154
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 21,264
[INCOME-PRETAX] 422,322
[INCOME-TAX] 0
[INCOME-CONTINUING] 422,322
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] 422,322
[EPS-BASIC] (.00)
[EPS-DILUTED] (.00)
