UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Quarter: December 31, 1998 Commission File Number:33-22264-FW
TIME FINANCIAL SERVICES, INC.
_________________________________________________________________
(Exact name of registrant as specified in its charter)
NEVADA 33-0840184
_________________________________________________________________
(State or other jurisdiction (I.R.S. Employer incorporation
of organization) or Identification No.)
1182 N. Tustin Street, Orange, CA 92806
_________________________________________________________________
(Address of principal executive offices)
(714) 288-5901
_________________________________________________________________
(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.
X Yes No
_____ _____
The number of shares outstanding of each of the issuer's
classes of stock, as of September 30, 1998, are as follows:
Class of Securities: Shares Outstanding:
Common Stock, $.001 par value 1,235,744
INDEX
TIME FINANCIAL SERVICES, INC.
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets (Unaudited): 3
As of December 31, 1998
Statements of Operation (Unaudited): 5
For the Three Months and Six months ended
December 31, 1998
Statement of Cash Flows (Unaudited): 6
For the Three Months and Six months
Ended December 31, 1998
Article 5 of Regulation S-X, Financial Data Schedule 7
Note to Financial Statements: 8
As of December 31, 1998 (Unaudited)
Item 2. Management's Discussion and Analysis of 9
Financial Condition and Results of Operations
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 2. Change in Securities 11
Item 3. Defaults Upon Senior Securities 11
Item 4. Submission of Matters to a Vote of Security 11
Holders
Item 5. Other Information 11
Signatures 12
TIME FINANCIAL SERVICES, INC.
BALANCE SHEET
Consolidated
(Unaudited)
<TABLE>
<S> <C> <C>
December 31, December 31,
1998 1997
_____________ _____________
ASSETS:
Current Assets:
Cash and cash equivalents $ 102,930 $ 76,682
Accounts receivable 0 0
Inventory 0 0
Prepaid expenses 800 6,950
_____________ _____________
Total Current Assets 103,730 83,632
Property and Equipment, net of
accumulated depreciation 7,489 10,102
Other Assets:
Investment in equity securities 0 150
Employee Advances 5,000 0
Real Property at acquisition cost 491,699 786,699
_____________ _____________
Total Other Assets 496,699 786,849
_____________ _____________
TOTAL ASSETS $ 607,918 $ 880,583
_____________ _____________
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current Liabilities:
Notes payable to bank 0 0
Accounts payable 11,245 41,548
Accrued expenses 5,432 4,416
Current Portion Long Term Debt 5,255 0
_____________ _____________
Total Current Liabilities $ 21,932 $ 45,964
Long Term Liabilities
Long Term Debt $ 442,063 639,321
_____________ _____________
Total Liabilities $ 463,995 $ 685,285
Stockholders' Equity:
Common stock, .001 par value;
50,000,000 shares authorized,
989,230 shares issued
and outstanding at
December 31, 1998 83,000 16,756
Additional paid-in capital 298,642 298,642
Stock for real estate 156,000 156,000
Retained earnings (deficit) (393,719) (276,100)
_____________ _____________
Total Stockholders' Equity 143,923 195,298
_____________ _____________
TOTAL LIABILITIES
AND STOCKHOLDERS' EQUITY $ 607,918 $ 880,583
============= =============
</TABLE>
TIME FINANCIAL SERVICES, INC.
STATEMENT OF OPERATIONS
FOR THE QUARTER ENDED DECEMBER 31, 1997
(Unaudited)
<TABLE>
<S> <C> <C> <C> <C>
Quarter Ending Six Months Ending
Dec. 31 Dec. 31 Dec. 31 Dec. 31
1998 1997 1998 1997
___________ ___________ ___________ ___________
REVENUES:
Loan origination
fees $ 57,213 $ 54,962 $ 166,395 $ 84,752
Rental income 10,948 13,612 19,355 13,612
Marketing Income 30,283 144,325 81,792 144,325
Product and
Software sales 29,934 60,370 67,036 110,470
Other fees and
income 81,209 38 111,209 5,164
___________ ___________ ___________ ___________
Total Revenue 209,586 273,307 445,786 358,323
___________ ___________ ___________ ___________
OPERATING EXPENSES:
Loan officer
commissions 64,521 76,050 153,794 103,468
Loan Processing
costs 4,814 4,925 29,873 9,343
Other general and
administrative 39,356 31,888 77,656 42,581
Operating costs 76,081 75,666 163,916 116,221
___________ ___________ ___________ ___________
Total Operating
Expenses 184,772 188,529 425,239 271,613
___________ ___________ ___________ ___________
OPERATING (LOSS)
Profit 24,814 84,778 20,547 86,710
NET (LOSS)
PER COMMON SHARE
Before
extraordinary loss 0.0201 0.0857 0.015 0.088
=========== =========== =========== ===========
Weighted Average
Shares
Outstanding 1,235,744 989,230 1,235,744 989,230
=========== =========== =========== ===========
</TABLE>
TIME FINANCIAL SERVICES, INC.
STATEMENT OF CASH FLOWS
FOR THE QUARTER ENDED DECEMBER 31, 1997 and 1998
(Unaudited)
<TABLE>
<S> <C> <C>
For the three months ending
December 31, December 31,
1998 1997
______________ ____________
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) $ 24,814 $ 86,711
Adjustments to reconcile net (loss) to
net cash (used in) operating
activities:
Depreciation and amortization 0 0
(Increase) Decrease in:
Accounts receivable 0 0
Officer receivable 0 0
Federal Income tax receivables 0 0
Inventory 0 0
Prepaid expense (24,198) (6,950)
Other Assets 0 0
Accounts payable and accrued expenses 2,992 (15,153)
Net cash provided (used in)
operating activities 3,608 (22,103)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment 295,000 0
Purchase of Goodwill 0 0
Investment Securities 4,630 64,608
Net Cash (used in) investing activities 299,630 12,074
Net cash provided by Financing Activities
Proceeds from issuance of stock 0 0
Mortgage Debt (217,636) 0
Net increase (decrease) in cash or
cash equivalents 85,602 64,608
Beginning of the period 17,327 12,074
Cash and Cash Equivalents -
End of Period $ 102,929 $ 76,682
</TABLE>
TIME FINANCIAL SERVICES, INC.
NOTE TO FINANCIAL STATEMENTS
December 31, 1998
(Unaudited)
The financial information included herein is unaudited; however,
such information reflects all adjustments (consisting solely of
normal recurring adjustments) which are, in the opinion of
management, necessary for a fair statement of results for the
interim period. Such results are not necessarily indicative of a
full year's operation.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Liquidity and Capital Resources
During the quarter ending December 31, 1998, the company sold its
first property that it had acquired the year before. The
property (Bellinger) was a single family residence located in
Huntington Beach, California. It was acquired for $295,000 with
stock given for the owners equity, with the property rented back
to the owner until June of 1998. Upon the owner vacating the
property, management spent three months repairing, painting and
making the property ready to market. It was sold for $365,000
and closed in November 1998.
The sale added significantly to the company's cash and liquidity
as evidenced by the cash flow statement with cash increasing
$85,602 for the quarter to an ending balance of $102,929. This
is 34% increase over the same period last year.
The sale reduced assets by $295,000 and reduced debt by $222,000,
and made the quarter profitable in the amount of $24,814. This
brought profit for the six months ending December 31, 1998 to
$20,547. With the company's loss carry forward there is no tax
accrual.
Results of Operations
Text Services Division
Management continues to search for a buyer for this
publication,"Wall Street Whispers." It's revenue was $29,934 for
the quarter. This is down 55% from the same period last year.
The text division lost ($8,425) for the quarter compared to a
profit of $12,464 for the same quarter a year ago. This is why
management continues to search for a buyer who will be able to
replace the declining sales of Prodigy with new markets. This
sale will improve profitability and liquidity by cutting losses
and selling assets that are not on the balance sheet.
Mortgage Lending Division
The lending revenue was $57,207 for the quarter ended. December
31, 1998, compared to $54,540 for the quarter ended December 31,
1997, an increase of $2,667 or 5%. Revenues were down 46% from
the quarter ended September 30, 1998 due to seasonal trends and
managements focus on the real estate division.
Real Estate Division
The real estate division sold one of the seven single family
homes it acquired in August 1997. Management's goal is to sell
one of these properties each quarter, subject to the real estate
market trends. In addition, management will acquire additional
properties for stock as the opportunity presents itself.
The rental income for the period ending December 31, 1998 was
$10,947 up 30% over the period ended December 31, 1997. Rental
income will decline due to the sale of Bellinger. The California
and Nevada real estate market continues to show strength, so the
company's properties are growing in value 3% to 10% per year.
Direct Mail Division
The Company's joint venture with Signature Marketing Inc.,
continued to decline due to the decline in the marketing of 125%
equity loans which made up the significant marketing volume the
prior year. Revenue for Direct Mail was $30,283 down 41% from
the quarter ended September 30, 1998 and down 79% from the
quarter ended December 31, 1997.
As the mortgage industry adjusts to new mortgage products the
revenue volume for direct mail will return in future quarters.
Subsequent Events:
A letter of intent has been signed with Lela Elliot of Houston to
sell the assets that make up the company's Houston Office, which
are used exclusively to produce the Publication, "Wall Street
Whispers." The letter of intent is dated May 14, 1999. Closing
of the sale took place on June 1, 1999. The company was given a
note for $120,000 repayable over 24 months.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
There has been no significant change in other legal matters at
this time.
Item 2. Changes in Securities
None
Item 3. Submission of Matters to a Vote of Securities Holders
None
Item 4. Defaults upon Senior Securities
None
Item 5. Other Information
Director and President Michael F. Pope filed a personal Chapter
7. This had no direct effect on the company.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act
of 1934, as amended, the Registrant has caused this report to be
signed on its behalf by the undersigned duly authorized persons.
Time Financial Services, Inc.
(Registered)
06/16/99 Michael F. Pope
(Date) (Signature)
06/16/99 Philip C. LaPuma
(Date) (Signature)
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1999
<PERIOD-END> DEC-31-1998
<CASH> 102,930
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 103,730
<PP&E> 7,489
<DEPRECIATION> 0
<TOTAL-ASSETS> 607,918
<CURRENT-LIABILITIES> 21,932
<BONDS> 0
0
0
<COMMON> 83,000
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 607,918
<SALES> 209,586
<TOTAL-REVENUES> 209,586
<CGS> 0
<TOTAL-COSTS> 184,772
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 24,814
<INCOME-TAX> 0
<INCOME-CONTINUING> 24,814
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 24,814
<EPS-BASIC> .201
<EPS-DILUTED> .201
</TABLE>
