<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[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
-------------------------------------------------
[ ] 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 1-10196
Dimensional Visions Group, Ltd.
-------------------------------
(Exact name of small business issuer as specified in its charter)
Delaware 23-2517953
-------- ----------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
8855 N. Black Canyon Hwy., Suite 2000 Phoenix, Arizona 85021
------------------------------------------------------------
(Address of principal executive offices)
(602) 997-1990
--------------
(Issuer's telephone number)
------------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 [ ].
As of March 31, 1997, the number of shares of Common Stock issued and
outstanding was 62,417,854.
<PAGE>
Dimensional Visions Group, Ltd. And Subsidiaries
INDEX
<TABLE>
<CAPTION>
Page
Number
------
PART I - FINANCIAL INFORMATION
<S> <C> <C>
Item 1. Financial Statements
Consolidated Condensed Balance Sheets - March 31, 1997
and June 30, 1996 .............................................................................. 1
Consolidated Condensed Statements of Operations - For the three and nine
months ended March 31, 1997 and 1996 ........................................................... 2
Consolidated Condensed Statements of Cash Flows - For the nine
months ended March 31, 1997 and 1996............................................................ 3
Notes to Consolidated Condensed Financial Statements................................................ 4
PART II - OTHER INFORMATION
Item 1. Legal Proceedings........................................................................ 9
Item 2. Management's Discussion and Analysis of Financial Conditions and Results of
Operations............................................................................ 9
Item 3. Changes in Securities.................................................................... N/A
Item 4. Defaults Upon Senior Securities......................................................... N/A
Item 5. Submission of Matters to a Vote of Security Holders...................................... N/A
Item 6. Other Information................................................. ...................... N/A
Item 7. Exhibits and Reports on Form 8-K......................................................... 10
.
SIGNATURES.......................................................................................... 10
</TABLE>
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
DIMENSIONAL VISIONS GROUP, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
ASSETS
March 31, June 30,
1997 1996
---- ----
(Unaudited)
Current assets
<S> <C> <C>
Cash and cash equivalents $117,542 $203,073
Accounts receivable, trade net of
allowances for bad debts of 66,055 32,608
$215,743
Inventory 14,325 89,458
Prepaid supplies and expenses 13,606 32,447
--------- ---------
Total current assets 211,528 357,586
--------- ---------
Equipment and leasehold improvements
Equipment 1,527,776 1,891,703
Furniture and fixtures 125,035 143,408
Leasehold improvements - 109,446
--------- ---------
1,652,811 2,144,557
Less accumulated depreciation and
amortization 1,550,041 2,007,317
--------- ---------
102,770 137,240
--------- ---------
Other assets
Goodwill, net of accumulated
amortization of $297,538 at
March 31, 1997; 152,790 at June 667,421 812,199
30, 1996
Deferred compensation costs 24,565 50,389
Patent right, and other assets 48,450 51,505
--------- ---------
740,436 914,093
--------- ---------
Total assets $1,054,734 $1,408,919
========== ==========
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
LIABILITIES AND STOCKHOLDERS' EQUITY
March 31, June 30,
1997 1996
---- ----
(Unaudited)
<S> <C> <C>
Current liabilities
Current portion of Long term debt $ 175,000 $ -
Accounts payable, accrued expenses and other liabilities 249,251 348,058
--------- ---------
Total current liabilities 424,251 348,058
Long term debt, net of current portion - 325,000
--------- ---------
Total liabilities 424,251 673,058
--------- ---------
Commitments and contingencies - -
Stockholders' equity
Preferred stock - $001 par value, authorized -
10,000,000 shares; issued and outstanding - 270,253
shares at March 31, 1997, 632,207 shares at June 270 632
30, 1996
Additional paid-in capital 1,057,845 3,503,161
--------- ---------
1,058,115 3,503,793
Common stock - $001 par value, authorized -
100,000,000 shares issued and outstanding -62,417,854
shares at March 31, 1997, 26,711,657 shares at
June 30, 1996 62,418 26,712
Additional paid-in capital 17,586,852 13,963,359
Deficit (18,076,902) (16,758,003)
---------- ----------
Total stockholders' equity 630,483 735,861
--------- ---------
Total liabilities and stockholders' equity $1,054,734 $1,408,919
========== ==========
</TABLE>
See notes to condensed consolidated financial statements.
1
<PAGE>
DIMENSIONAL VISIONS GROUP, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
------------------ -----------------
March 31, March 31,
--------- ---------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Operating revenue $ 130,846 $ 254,899 $ 351,792 $ 777,324
Cost of Sales 38,615 256,615 150,772 642,900
------ ------- ------- -------
Gross profit 92,231 (1,716) 201,020 134,424
------ ------- ------- -------
Operating expenses
Engineering and development costs 170,963 82,868 365,802 258,725
Marketing expenses 63,002 46,280 259,649 169,767
General and administrative expenses 264,568 342,004 735,124 1,079,507
------- ------- ------- ---------
Total operating expenses 498,533 471,152 1,360,575 1,507,999
------- ------- --------- ---------
Loss before other income (expenses) (406,302) (472,868) (1,159,555) (1,373,575)
--------- --------- ----------- -----------
Other income (expenses)
Interest expense (6,202) (6,371) (20,720) (61,455)
Interest income 1,103 2,158 6,124 9,829
Gain on sale of equipment - - - 2,000
Amortization of Goodwill (48,249) (51,307) (144,748) (111,165)
-------- -------- --------- ---------
(53,348) (55,520) (159,344) (160,791)
--------- -------- --------- ---------
Net loss ($459,650) ($528,388) ($1,318,899) ($1,534,366)
============ ========== ============ ------------
Net loss per share of common stock ($.01) ($.03) ($.03) ($.09)
====== ====== ====== ======
Weighted average shares of common stock outstanding 61,509,154 18,154,565 43,614,032 17,576,663
========== ========== ========== ==========
</TABLE>
See notes to condensed consolidated financial statements.
2
<PAGE>
DIMENSIONAL VISIONS GROUP, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended March 31,
---------------------------
1997 1996
---- ----
Cash flows from operating activities
<S> <C> <C>
Net loss ($ 1,318,899) ($ 1,534,366)
Total adjustments to reconcile net loss to net cash
used in operating activities 497,098 246,040
------- -------
Net cash used in operating activities (821,801) (1,288,326)
--------- ----------
Cash flows from investing activities
Cash acquired in acquisition - 275,632
Proceeds from sale of equipment - 2,000
Repayment of advances to employees - 11,000
Property and equipment and progress payments
on equipment under construction (2,730) (29,846)
------- --------
Net cash provided by (used in) investing activities (2,730) 258,786
------- -------
Cash flows from financing activities
Proceeds from long-term borrowing 250,000 523,500
Sale of common stock, net of offering cost of 489,000 678,100
$75,000 in 1995
Net cash provided by financing activities 739,000 1,201,600
------- ---------
Net increase (decrease) in cash and cash equivalents (85,531) 172,060
Cash and cash equivalents, beginning 203,073 262,975
------- ----------
Cash and cash equivalents, ending $ 117,542 $ 435,135
========== ==========
Supplemental disclosures of cash flow information:
Cash paid during the period for interest - $ 9,726
========== ===========
Issuance of common stock in connection with
Compensation $ 51,880 $ -
========== ===========
Consulting services $ 203,675 $ -
========== ===========
Payment of an advance from Individual $ 15,000 $ -
========== ===========
</TABLE>
3
<PAGE>
DIMENSIONAL VISIONS GROUP, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATE STATEMENTS OF CASH FLOWS (Continued)
(Unaudited)
Supplemental disclosure of non-cash investing and financing activities for nine
months ended March 31, 1997 and 1996:
During the nine months ended March 31, 1997, 1,400,000 shares of the
Company's stock was issued as a result of the conversion of 35,000 shares
of Series A Convertible Preferred Stock valued at $350,000.
During the nine months ended March 31, 1997, 1,565,150 shares of the
Company's Common Stock was issued as a result of the conversion of 156,515
shares of Series P Convertible Preferred Stock valued at $391,288.
During the nine months ended March 1997, 22,284,000 shares of the
Company's Common Stock was issued as a result of the conversion of 185,700
shares of Series B Convertible Preferred Stock valued at $1,857,000.
During the nine months ended March 31, 1997, 5,307,507 shares of the
Company's Common Stock was issued as a result of the conversion of
$400,000 of Convertible Debenture issued pursuant to a Regulation S
offering.
During the nine months ended March 31, 1997, 47,390 shares of the
Company's Common Stock was issued as a result of the conversion of 4,739
shares of Series C Convertible Preferred Stock valued at $47,390.
On September 12, 1995, the Company acquired all of the outstanding Common
Stock of InfoPak, Inc. In exchange for 500,000 shares of Series P
Convertible Preferred Stock valued at $1,250,000, and the cancellation of
debt to certain shareholders of InfoPak, Inc. in exchange for 31,379
Series P Convertible Preferred shares valued at $78,448. The Company
acquired assets valued at $442,769, (including cash of $275,632), and the
assumption of liabilities of $103,590. In addition, certain employees
under contract and a consultant received 17,500 shares of Series P
Convertible Preferred Stock valued at $43,750 as a signing bonus.
In August, 1995 in connection with the sale of 3,000,000 shares of the
Company's Common Stock, certain stockholders, consisting mainly of
officers and directors, surrendered 3,215,000 of the Company's Common
Stock in exchange for 32,150 shares of Series S Preferred.
In September, 1995 the Company issued 1,000,000 warrants to the then Chief
Executive Officer and 500,000 warrants to the then financial consultant to
the Company to purchase the Company's Common Stock at $.25 and $.15,
respectively. The warrants issued to the financial consultant were valued
at $100,000 and was expensed. In addition, in connection with the sale of
the 3,000,000 shares of the Company's Common Stock for $675,000 net of
commissions, an additional 1,250,000 of warrants to purchase the Company's
Common Stock (750,000 at $.15 and 500,000 at $.50) were issued.
See notes to condensed consolidated financial statements.
4
<PAGE>
DIMENSIONAL VISIONS GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NINE MONTHS ENDED March 31, 1997
(Unaudited)
Note 1 Basis of Presentation of Interim Financial Statements
The interim financial statements are prepared pursuant to the
requirements for reporting on Form 10-QSB. The June 30, 1996 balance
sheet data were derived from audited financial statements but does not
include all disclosures required by generally accepted accounting
principles. The interim financial statements and notes thereto should
be read in conjunction with the financial statements and notes included
in the Company's Annual Report on Form 10-KSB for the fiscal year ended
June 30, 1996. In the opinion of management, the interim financial
statements reflect all adjustments of a normal recurring nature
necessary for a fair statement of the results for the interim periods
presented. The current period results of operations are not necessarily
indicative of results which ultimately will be reported for the full
year ending June 30, 1997.
Note 2 Accounts Payable, Accrued Expenses and Other Liabilities
<TABLE>
<CAPTION>
March 31, 1997 June 30,1996
-------------- ------------
<S> <C> <C>
Accounts payable $ 104,577 $118,525
Accrued expenses
Interest 9,309 3,684
Salaries 105,666 111,449
Consulting fees 18,000 88,000
Payroll Taxes Payable 11,699 -
Customer deposit - 26,400
--------- --------
Total $ 249,251 $348,058
========= ========
Note 3 Long-Term Debt
Long-term debt consisted of the following:
March 31,1997 June 30, 1996
5% convertible debenture due August 1, 1997 100,000(1) 250,000(1)
10% secured notes due in January and February, 1998 75,000(2) 75,000(2)
-------- -------
175,000 325,000
Less current portion 175,000 -
-------- -------
Long term portion - $325,000
======== =======
</TABLE>
5
<PAGE>
DIMENSIONAL VISIONS GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NINE MONTHS ENDED March 31, 1997
(Unaudited)
Note 3 Long-Term Debt (Continued)
(1) During July through September 30, 1996, $150,000 of the debenture
was converted to 2,063,186 shares of the Company's Common Stock at an
average per share price of $.07. This debt is convertible into the
Company's Common Stock at 50% of the price of the Company's stock on
the day prior to conversion, but at no time shall the conversion price
be greater than $.31 a share. During September and October 1996,
additional debentures for $250,000 were issued. This debt is
convertible into the Company's Common Stock at 50% of the price of the
Company's stock on the day prior to conversion, but at no time shall
the conversion price be greater than $ .145 a share. During October
1966 through January, 1997 $250,000 of the Debenture was converted to
3,244,321 shares of the Company's stock at an average price of $.07.
(2) In 1994 and 1995, the Company gave a security interest in all of
the Company's tangible and intangible assets, including all patents and
proprietary technologies as collateral for $1,982,000 of 10% secured
notes, which was evidenced by a Uniform Commercial Code of filing on
March 24, 1994.
On October 1, 1995, holders of $1,757,000 of outstanding secured notes
exercised their warrants to convert the secured notes to Series B
Convertible Preferred Stock except for the above secured note holders
and a director who subsequently, in February 1996, exercised his right
to convert a $150,000 secured note to Series B Convertible Preferred
Stock. In addition, the note holders also agreed to convert $262,750 of
interest due on the 10% secured notes into Series C Convertible
Preferred Stock. As of March 31, 1997 there remained outstanding
$75,000 of the 10% secured notes.
Note 4 Common Stock
As of March 31, 1997, there was outstanding 16,278,910 of non-public
warrants to purchase the Company's Common Stock at prices ranging from
$.10 to $.75 with a weighted average price of $.21 per share. The
Company has also agreed to issue up to 2,650,000 warrants to purchase
the Company's Common Stock, at prices ranging from $.15 to $.20 with a
weighted average price of $.19 per share, to certain employees. The
issuance of these warrants is subject to the individuals meeting
certain predetermined performance goals, which if obtained would
improve the Company's DV3DTM print products and the sales of such
products.
As of March 31, 1997, there were 270,253 shares of Convertible
Preferred Stock outstanding which can be converted to 2,239,732 shares
of common stock (see Note 5).
As of March 31, 1997, there are 7,500 Series B Warrants outstanding to
purchase Series B Convertible Preferred Stock which can be converted
into 750,000 shares of the Company's Common Stock (see Note 3).
As of March 31, 1997 there was a $100,000 5% Convertible Debenture
which can be converted into a minimum of 689,655 shares of the
Company's Common Stock depending upon the price of the Company's Common
Stock the day preceding the conversion
The total number of shares of the Company's Common Stock that would be
issuable upon the conversion of the outstanding debt, preferred stock
and the exercise of all outstanding warrants would be 85,026,151 shares
as of March 31, 1997.
6
<PAGE>
DIMENSIONAL VISIONS GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NINE MONTHS ENDED March 31, 1997
(Unaudited)
Note 4 Common Stock (Continued)
During the nine months ended March 31, 1997, 35,706,197 (net of 479,350
shares surrendered to the Company)shares of the Company's Common Stock
were issued as follows:
Conversion of 15,000 shares of Series A convertible Preferred
stock valued at $150,000 into 600,000 shares of the Company's
Common Stock.
Conversion of 185,700 shares of Series B Convertible Preferred
Stock valued at $1,857,000 into 22,284,000 shares of the Company's
Common Stock.
Conversion of 4,739 shares of Series C Convertible Preferred
Stock valued at $47,390 into 47,390 shares of the Company's
Common Stock.
Conversion of 156,515 shares of Series P Convertible Preferred
stock valued at $391,288 into 1,565,150 shares of the Company's
Common Stock.
Conversion of $400,000 of convertible debentures to 5,307,507
shares of the Company's Common Stock issued pursuant to a
Regulation S offering.
Conversion of a $15,000 advance to 150,000 shares of the Company's
Common Stock valued at $.10 per share.
Issuance of 1,727,500 shares of the Company's Common Stock to
consultants for services valued at $203,575.
Issuance of 301,500 shares of the Company's Common Stock to
employees for compensation valued at $51,880.
Conversion of $50,000 of accrued consulting fees to 312,500 shares
of the Company's Common Stock valued at $.16 per share.
The Company sold through private placement 1,390,000 shares of the
Company's Common Stock value at $.10 per share.
The Company sold through an offshore placement 2,500,000 shares of
the Company's Common Stock value at $.14 per share.
Note 5 Preferred Stock
The Company has authorized 10,000,000 shares of $.001 par value per
share Preferred Stock, of which the following were issued and
outstanding:
<TABLE>
<CAPTION>
Allocated Outstanding Outstanding
--------- ----------- -----------
March 31, 1997 June 30, 1996
-------------- -------------
<S> <C> <C> <C>
Series A Preferred 100,000 25,500 40,500
Series B Preferred 200,000 5,000 190,700
Series C Preferred 1,000,000 18,681 23,420
Series P Preferred 600,000 217,922 374,437
Series S Preferred 50,000 3,150 3,150
--------- -------- --------
Total Preferred Stock 1,950,000 270,253 632,207
========= ======== ========
</TABLE>
7
<PAGE>
DIMENSIONAL VISIONS GROUP, LTD. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NINE MONTHS ENDED March 31, 1997
(Unaudited)
Note 5 Preferred Stock (Continued)
The Company's Series A Convertible 5% Preferred Stock ("Series A
Preferred"), 100,000 shares authorized, is convertible into common
stock at the rate of 40 shares of common stock for each share of the
Series A Preferred. Dividends from date of issue, are payable from
retained earnings, and have been accumulated on June 30 each year, but
have not been declared or paid.
The Company's Series B Convertible 8% Preferred Stock ("Series B
Preferred"), is convertible at the rate of 100 shares of common stock
for each share of Series B Preferred. Dividends from date of issue are
payable on June 30 from retained earnings at the rate of 8% per annum
and have not been declared or paid.
The Company filed with the Securities and Exchange Commission form SC
13E4 on August 19, 1996 an offer to all holders of Series B Preferred
Stock to exchange each of their shares for 120 shares of the Company's
Common Stock. Substantially all of the shares, ninety-eight percent
(98% (186,700 shares)), have been tendered and 22,284,000 shares of the
Company's Common Stock was issued during December 1996.
The Company's Series C Convertible Preferred Stock ("Series C
Preferred"), is convertible at a rate of 10 shares of common stock per
share of Series C Preferred.
The Company's Series P Convertible Preferred Stock ("Series P
Preferred"), is convertible at a rate of 10 shares of common stock for
each share of Series P Preferred. The fair market value of the 548,879
shares of Series P Preferred issued relating to the merger, debt
cancellation and signing bonuses to certain employees and a consultant,
was valued at $1,372,198 ($2.50 per share) based upon the price at
which the Company was able to sell 3,000,000 shares of its common stock
on September 5, 1995 through a Regulation S offering which was $.25 per
share.
The Company's Series S Convertible Preferred Stock ("Series S
Preferred"), is convertible at the rate of 100 shares of common stock
for each share of Series S Preferred.
The Company's Series A Preferred and Series B Preferred were issued for
the purpose of increasing the capital of the Company. The Series C
Preferred was issued to certain holders of the Company's 10% Secured
Notes in lieu of accrued interest and also will be held for future
investment purposes. The Series S Preferred was issued to certain
stockholders consisting mainly of officers and directors of the Company
in exchange for such stockholders' shares of common stock. After this
exchange, common stock was sold on September 5, 1995 for the purpose of
raising additional capital.
The Series P Preferred was issued on September 12, 1995 to InfoPak
shareholders in exchange for (1) all of the outstanding capital stock
of InfoPak, (2) as signing bonuses for certain employees and a
consultant of InfoPak, and (3) to satisfy InfoPak's outstanding debt
obligations to certain shareholders.
The 190,700 shares of Series B Preferred were issued to holders of
warrants to purchase such preferred stock. The funding for the exercise
of these warrants was the exchange of $1,907,000 of principal amount of
secured and unsecured notes.
The 26,275 shares of Series C Preferred were also issued in exchange
for $262,750 of interest due under the secured and unsecured note
holders of 2,855 shares of Series C Preferred Stock have subsequently
converted their shares into the Company's Common Stock.
8
<PAGE>
PART II - OTHER INFORMATION
The following Management's Discussion and Analysis of Financial
Condition and Results of Operations contains forward-looking statements
that involve risks and uncertainties. The Company's actual results
could differ materially from those implied in these forward-looking
statements as a result of certain factors, including, but not limited
to, those set forth in this report.
Item 1. Legal Proceedings
In March 1997, a former employee filed a civil action naming the
Company, in the United States District Court for the Eastern District
of Pennsylvania. The Company's legal counsel believes the action is
totally without merit and the Company will pursue dismissal of all
charges. The Company has petitioned the Court to change the venue to
Maricopa County, Arizona.
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
Three months ended March 31, 1997 and 1996
Liquidity and Capital Resources
-------------------------------
As of March 31, 1997 the Company had a working capital deficiency of
$212,723 compared with a working capital deficiency of $320,563 as of
March 31, 1996.
The Company expects to receive approximately $ 250,000 to $300,000
during fiscal year 1997 from monthly licensing fees for the InfoPak
Portable MLS product. As of March 31, 1997, InfoPak has billed $191,692
of this amount and will continue to invoice its distributors on a
monthly basis. The majority of the fees began in January 1997 pursuant
to existing distribution agreements. The actual amount of such fees
will be determined by the number of MLS InfoReaders in service during
the year.
Results of Operations
---------------------
The net loss for the quarter ended March 31, 1997 was $459,650 compared
to a net loss of $528,388, for the quarter ended March 31, 1996. The
decrease in the loss was caused primarily by a decrease in compensation
expenses. Revenues for the quarter ended March 31, 1997 were $130,846
compared to revenues of $351,792 for the quarter ended March 31, 1996.
The decrease in revenues was the result of there being no recorded
sales of DV3D(R) print products through December 31,1996. However, in
January 1997 there were sales of the DV3D(R) print products of
$45,000. Also during the period there were decreased sales of the
InfoPak products. InfoPak changed its distribution system by changing
its distributor base. The Company has combined its DV3D(R) stereoscopic
print technology with its Animotion(TM) print products. The Company
expects that the DV3D(R) Animotion(TM) print products will be the
primary print products to be sold during the quarter ended June 30,
1997.
Nine months ended March 31, 1997 and 1996
Liquidity and Capital Resources
-------------------------------
For the nine months ended March 31, 1997 the Company raised $739,000
through private placement of its securities. The Company needs
additional funding in order to maintain current operations. The Company
is not to the point of generating sufficient revenues from operations
to cover its cost structure. The Company has been funding its
operations by selling its securities in private placements, offshore
transactions, short-term borrowing, accruing compensation to certain
employees, and sale of its products. The Company continues to discuss
with outside shareholders and other third parties the raising of
additional funds. The amount of third party funding, depends to some
extent on the Company's revenues and cash flow from operations. No
assurance can be given that the Company will be able to obtain
additional funds in the long term necessary to maintain its existing
operations. In the event the Company is not able to secure sufficient
funds in a timely basis necessary to maintain its current operations,
it may cease all or part of its existing operations.
9
<PAGE>
Results of Operations
---------------------
The net loss for the nine month period ending March 31, 1997 was
$1,318,899 compared with a net loss of $1,534,366 for the period ended
March 31, 1996. The decrease in the loss was caused primarily by a
decrease in compensation expenses such as consulting fees and salaries.
Revenues for the nine months ended March 31, 1997 were $351,792
compared to $777,324 for the nine months ended March 31, 1996. The
decrease in revenues was the result of InfoPak not generating revenues
on the sale of its products comparable to the nine months ended March
31, 1996 primarily because it changed its distributor base and such
change has not produced revenues as anticipated. Also the Company
ceased doing business with a major distributor for the DV3D(R) print
product on account of said distributor not paying for a order worth
approximately $213,000. The Company is in the process of broadening its
customer and distributor base for the DV3D(R) print products.
The Company expects to incur operating losses through the quarter
ending June 30, 1997. However, the Company continues to implement a
program for reducing its operating expenses and controlling its
internal costs. The Company has consolidated its corporate offices and
production facilities in Phoenix, Arizona. The Company has decreased
its use of consultants and continues to lower other non-operating
expenses. The Company has introduced three new products, the
Animotion(TM) print product, the InfoPak(TM) Electronic Auto Pricing
Guide product and the InfoPunch(TM) Electronic Construction Checklist.
The Company incorporated its DV3D(R) stereoscopic technology into its
Animotion(TM) print products and has developed its internal production
capabilities, such that it has only to use third party printing
companies for the completion of its print products. The Company's sales
and marketing activities have lead to a number of requests for price
quotations which management believes will result in significant orders
for the Company's DV3D(R) print products.
Item 7. Exhibits and Reports on Form 8-K
The following documents are filed as part of this report:
<TABLE>
<CAPTION>
<S> <C> <C>
1. The following Exhibits are filed herein: 27.0 Financial Data Schedule
2. Reports on Form 8-K filed None
</TABLE>
Signatures
In accordance with the Exchange Act, the registrant caused this report to
be signed on its behalf by the undersigned, duly authorized.
DIMENSIONAL VISIONS GROUP, LTD.
DATED: May 20, 1997 By: /s/ George S. Smith
-------------------
George S. Smith, Chairman and
Chief Executive Officer
10
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000836809
<NAME> DIMENSIONAL VISIONS GROUP, LTD.
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 0
<CASH> 117,542
<SECURITIES> 0
<RECEIVABLES> 281,798
<ALLOWANCES> 215,743
<INVENTORY> 14,325
<CURRENT-ASSETS> 211,528
<PP&E> 1,652,811
<DEPRECIATION> 1,550,041
<TOTAL-ASSETS> 1,054,734
<CURRENT-LIABILITIES> 424,251
<BONDS> 0
0
1,058,115
<COMMON> 62,418
<OTHER-SE> (490,050)
<TOTAL-LIABILITY-AND-EQUITY> 1,054,734
<SALES> 351,792
<TOTAL-REVENUES> 351,792
<CGS> 150,772
<TOTAL-COSTS> 150,772
<OTHER-EXPENSES> 1,360,575
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 6,124
<INCOME-PRETAX> (1,318,899)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,318,899)
<EPS-PRIMARY> (.03)
<EPS-DILUTED> 0
</TABLE>
