FORM 10-Q
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: June 30, 1994
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: 33-31639
Finca Consulting, Inc.
(Exact name of registrant as specified in its Charter)
Colorado 84-1121635
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Koenigsallee 106, 40215 Duesseldorf, Germany
(Address of principal executive offices) (Zip Code)
(011-49-211) 384860
(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 filed such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes [X] No [ ]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Not applicable.
APPLICABLE ONLY TO CORPORATE ISSUERS:
As of June 30, 1994, 2,146,633 shares of Registrant's Common Stock,
$.01 par value, and 16,305 shares of Registrant's Convertible Preferred Stock,
$.00001 par value were issued and outstanding.
<PAGE>
Finca Consulting, Inc.
Index
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Notes to Consolidated Financial Statements
Item 2. Management's Discussion and Analysis
of Financial Condition and Results
of Operations
Part II OTHER INFORMATION
Item 1. Legal Proceedings.
Item 2. Changes in Securities.
Item 3. Defaults Upon Senior Securities.
Item 4. Submission of Matters to a Vote
of Security Holders.
Item 5. Other Information.
Item 6. Exhibits and Reports on Form 8-K.
<PAGE>
PART I FINANCIAL INFORMATION
ITEM 1
Finca Consulting, Inc. and Subsidiaries
Index to the Consolidated Financial Statements
June 30, 1994
Financial Statements
Consolidated Balance Sheets................................................
Consolidated Statements of Operations......................................
Consolidated Statements of Changes in Stockholders' Equity.................
Consolidated Statements of Cash Flows......................................
Notes to the Consolidated Financial Statements.............................
<PAGE>
<TABLE>
<CAPTION>
Finca Consulting, Inc. and Subsidiaries
Consolidated Balance Sheets
(Unaudited)
June 30, December 31,
1994 1993
----------- -----------
<S> <C> <C>
Assets
Current Assets
Cash .................................................................... $ 595,365 $ 351,701
Marketable securities ................................................... 43,310 --
Accounts receivable ..................................................... 6,142 --
Other current assets .................................................... 117,520 54,137
Receivable due from related parties ..................................... 261,340 293,931
----------- -----------
Total Current Assets ............................................... 1,023,677 699,769
----------- -----------
Property and Equipment, at cost
Land .................................................................... 115,563 134,949
Buildings ............................................................... 462,254 545,238
Office furniture and equipment .......................................... 258,846 252,102
Motor vehicle ........................................................... -- 9,082
----------- -----------
836,663 941,371
Less: accumulated depreciation .......................................... (179,199) (171,304)
----------- -----------
Net Property and Equipment ......................................... 657,464 770,067
----------- -----------
Other Assets
Deposits ................................................................ 14,189 53,341
Capital cost - office premium, net of accumulated amortization of $11,151 -- 15,426
Investment in Vintage Cars .............................................. 95,202 101,250
Goodwill, net of accumulated amortization of $1,577 ..................... -- 40,487
Other assets ............................................................ 67,285 136,542
----------- -----------
Total Other Assets ................................................. 176,676 347,046
----------- -----------
Total Assets ....................................................... 1,857,817 1,816,882
=========== ===========
Liabilities and Stockholders' Equity
Current Liabilities
Accounts payable and accrued expenses ................................... 206,145 196,522
Customer credit balances ................................................ 1,431,200 926,712
Note payable ............................................................ -- 19,195
----------- -----------
Total Current Liabilities .......................................... 1,637,345 1,142,429
----------- -----------
Minority interests in subsidiary ........................................ 45,632 45,632
----------- -----------
</TABLE>
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<TABLE>
<CAPTION>
Finca Consulting, Inc. and Subsidiaries
Consolidated Balance Sheets
(continued)
(Unaudited)
June 30, December 31,
1994 1993
----------- -----------
<S> <C> <C>
Stockholders' Equity
Common stock, $.01 par value, 20,000,000 shares authorized, 2,146,633
shares issued and outstanding ........................................ 21,466 21,466
Preferred stock; $.00001 par value, 20,000,000 shares authorized, 16,305
shares issued and outstanding ........................................ 1 1
Capital in excess of par value .......................................... 4,717,449 5,107,476
Accumulated deficit ..................................................... (4,520,692) (4,428,873)
Treasury Stock, 122,266 common shares ................................... (1,223) --
Cumulative translation adjustment ....................................... (42,161) (71,249)
----------- -----------
Total Stockholders' Equity ......................................... 174,840 628,821
----------- -----------
Total Liabilities and Stockholders' Equity ......................... $ 1,857,817 $ 1,816,882
=========== ===========
</TABLE>
See notes to the consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
Finca Consulting, Inc. and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
------------------------------ -------------------------------
1994 1993 1994 1993
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Revenues ............................... $ 4,624,915 $ 2,805,320 $ 11,733,436 $ 6,372,014
Cost of Shares and Options ............. 2,984,555 1,988,473 7,790,911 3,858,584
------------ ------------ ------------ ------------
Gross Profit ........................... 1,640,360 816,847 3,942,525 2,513,430
Selling, general and administrative
expenses ............................... 1,768,404 1,528,361 4,010,618 3,016,785
------------ ------------ ------------ ------------
(Loss) From Operations ....... (128,044) (711,514) (68,093) (503,355)
------------ ------------ ------------ ------------
Other Income (Expense)
Interest income ..................... -- 4 -- 398
Interest expense .................... (23,726) (13,017) (23,726) (13,840)
------------ ------------ ------------ ------------
Total Other Income (Expense) ... (23,726) (13,013) (23,726) (13,442)
------------ ------------ ------------ ------------
Net (Loss) ............................. $ (151,770) $ (724,527) $ (91,819) $ (516,797)
============ ============ ============ ============
Net (Loss) Per Share ................... $ (0.071) $ (0.35) $ (0.43) $ (0.25)
============ ============ ============ ============
Weighted Average Number of Common
Shares Outstanding...................... 2,146,633 2,040,937 2,146,633 2,040,937
============ ============ ============ ============
</TABLE>
See notes to the consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
Finca Consulting, Inc. and Subsidiaries
Consolidated Statements of Changes in Stockholders' Equity
From December 31, 1993 Through June 30, 1994
(Unaudited)
Preferred Stock Common Stock Treasury Stock
-------------------------- --------------------------- ----------------------------
Capital
in Excess
Par Par of Par
Shares Value Shares Value Value Shares
----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Balance - December 31, 1993 ....... 16,305 $ 1 2,146,633 $ 21,466 $ 5,107,476 --
Acquisition of treasury shares .... -- -- -- -- (390,027) (122,266)
Foreign currency transition gain .. -- -- -- -- -- --
Net (Loss) for the six month period
ended June 30, 1994 ............. -- -- -- -- -- --
----------- ----------- ----------- ----------- ----------- -----------
16,305 $ 1 2,146,633 $ 21,466 $ 4,717,449 (122,266)
Balance - June 30, 1994
=========== =========== =========== =========== =========== ===========
<CAPTION>
Cumulative
Par (Accumulated Translation
Value Deficit) Adjustment
----------- ----------- -----------
<S> <C> <C> <C>
Balance - December 31, 1993 ....... $ -- $(4,428,873) $ (71,249)
Acquisition of treasury shares .... (1,223)
Foreign currency transition gain .. -- -- 29,088
Net (Loss) for the six month period
ended June 30, 1994 ............. -- (91,819) --
----------- ----------- -----------
$ (1,223) $(4,520,692) $ (42,161)
Balance - June 30, 1994
=========== =========== ===========
</TABLE>
See notes to the consolidated financial statements.
<PAGE>
<TABLE>
<CAPTION>
Finca Consulting, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(Unaudited)
Six Months Ended June 30,
--------------------------
1994 1993
--------- ---------
<S> <C> <C>
Cash Flows From Operating Activities
Net (Loss) ........................................................... $ (91,819) $(516,797)
Adjustments to Reconcile Net (Loss) to Net Cash Provided by (Used for)
Operating Activities
Depreciation and amortization ..................................... 65,456 59,261
(Increase) decrease in marketable securities ...................... (43,310) 940
(Increase) in accounts receivable ................................. (6,142) --
Decrease (increase) in receivable due from related parties ........ 32,591 (473,284)
Decrease in prepaid expenses ..................................... -- 4,369
(Increase) decrease in other current assets ....................... (63,383) 23,854
Decrease in sales tax refunds receivable .......................... -- 98,216
Decrease in note payable .......................................... (19,195) --
Decrease (increase) in other assets ............................... 69,257 (97,454)
Decrease in goodwill .............................................. 40,487 --
Decrease in capital cost - office premium ......................... 15,426 --
Decrease in deposits .............................................. 39,152 3,024
Increase in accounts payable and accrued expenses ................. 9,623 107,385
Increase in customer credit balances .............................. 504,488 857,538
--------- ---------
Net Cash Provided by Operating Activities ....................... 552,631 67,052
--------- ---------
Cash Flows From Investing Activities
Disposition (purchase) of property and equipment ..................... 53,195 (14,733)
Investment in real estate - Spain .................................... -- (26,554)
--------- ---------
Net Cash Provided by (Used in) Investing Activities ............. 53,195 (41,287)
--------- ---------
Cash Flows from Financing Activities
Acquisition from treasury shares ..................................... (391,250) --
--------- ---------
Net Cash Used in Financing Activities ........................... (391,250) --
--------- ---------
Effect on Exchange Rate Changes on Cash ................................. 29,088 8,487
--------- ---------
Net Increase in Cash .................................................... 243,664 34,252
Cash at Beginning of the Period ......................................... 351,701 374,915
--------- ---------
Cash at the End of the Period ........................................... $ 595,365 $ 409,167
========= =========
SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Issuance of common stock ............................................. $ -- $ 798,232
========= =========
</TABLE>
See notes to the consolidated financial statements.
<PAGE>
Finca Consulting, Inc. and Subsidiaries
Notes to the Consolidated Financial Statements
(Unaudited)
BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and
Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management,
all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. Operating results for
the six month period ended June 30, 1994 are not necessarily indicative of
the results that may be expected for the year ended December 31, 1994. For
further information, refer to the consolidated financial statements and
footnotes thereto included in the Registrant Company and Subsidiaries' annual
report on Form 10-K for the year ended December 31, 1993.
The balance sheet at December 31, 1993 has been derived from the audited
financial statements of that date but does not include all of the information
and footnotes required by generally accepted accounting principles for
complete financial statements.
<PAGE>
Finca Consulting, Inc. and Subsidiaries
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with the Financial
Statements and Notes thereto included herein.
Results of Operations
Substantially all of the Company's revenues during the quarter ended June 30,
1994, were generated by its subsidiary, Opti-Wert-Interest AG ("OWI-AG") through
sales commissions derived from its retail securities brokerage activities.
Revenues for the quarter totaled $4,624,915 as compared to $2,805,320 during the
second quarter a year ago. Revenues for the six months ended June 30, 1994,
amounted to $11,733,436 - an increase of 84% over the same period last year.
Selling, general and administrative expenses for the quarter totaled $1,768,404
which is in line with the changes in revenues.
For the quarter ended June 30, 1994, the Company suffered a net loss of
$151,770 compared to a loss of $724,527 during the second quarter last year. The
six months' results were losses of $91,819 and $516,797 for 1994 and 1993,
respectively.
Liquidity and Capital Resources
The Company had total assets as of June 30, 1994 of $1,857,817, of which
$1,023,677 were current assets. Despite efforts by Management to streamline
operations and reduce expenses, the working capital deficit at June 30, 1994,
increased further, to $613,668. The Company is in need of further equity capital
to augment working capital and improve liquidity, and is investigating several
funding alternatives.
<PAGE>
PART II - OTHER INFORMATION
ITEM 1.Legal Proceedings.
There were no pending or threatened legal proceedings during this period.
ITEM 2.Changes In Securities.
Not Applicable.
ITEM 3.Defaults Upon Senior Securities.
Not Applicable.
ITEM 4.Submission of Matters to a Vote of Securities.
Not Applicable.
ITEM 5.Other Information
Not Applicable.
ITEM 6.Exhibits and Reports on Form 8-K
(a) (3)(i) Articles of Incorporation: incorporated by reference to the
Company's Form S-18 Registration Statement, filed with the Securities and
Exchange Commission on October 17, 1989, and declared effective on June 29,
1990.
(3)(i) Articles of Amendment to Articles of Incorporation: incorporated
by reference to the Exhibit to the Company's Form 10-K for the fiscal year ended
December 31, 1991 filed on June 4, 1992 with the Securities and Exchange
Commission.
(3)(ii) Bylaws:incorporated by reference to the Company's Form S-18
Registration Statement, filed with the Securities and Exchange Commission on
October 17, 1989, and declared effective on June 29, 1990.
(21) Subsidiaries of the Company:
(i) Finca Consulting Costa Brava, S.A. - is a corporation formed under
the laws of the Country of Spain and is the name under which it conducts
business.
(ii) Finca Consulting, GmbH - is a corporation formed under the laws of
the Country of Germany and is the name under which it conducts business.
(iii)Opti-Wert-Interest AG - is a corporation formed under the laws of
the Country of Switzerland and conducts its retail securities and options
business in Germany.
(27) Financial Data Schedule
(b) Reports on Form 8-K
The Company filed no reports on Form 8-K during the period covered by this
report on Form 10-Q.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
FINCA CONSULTING, INC.
(Registrant)
Date: December 20, 1997 By: /s/Volker Montag
----------------
Volker Montag, President
Principal Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FINANCIAL
STATEMENTS OF FINCA CONSULTING, INC. AND SUBSIDIARIES AT AND FOR THE SIX MONTHS
ENDED JUNE 30, 1994 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> JUN-30-1994
<CASH> 595,365
<SECURITIES> 43,310
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,023,677
<PP&E> 836,663
<DEPRECIATION> 179,199
<TOTAL-ASSETS> 1,857,817
<CURRENT-LIABILITIES> 1,637,345
<BONDS> 0
0
1
<COMMON> 21,466
<OTHER-SE> 153,373
<TOTAL-LIABILITY-AND-EQUITY> 1,857,817
<SALES> 0
<TOTAL-REVENUES> 11,733,436
<CGS> 0
<TOTAL-COSTS> 7,790,911
<OTHER-EXPENSES> 4,010,618
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 23,726
<INCOME-PRETAX> (68,093)
<INCOME-TAX> 0
<INCOME-CONTINUING> (68,093)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (91,819)
<EPS-PRIMARY> (0.43)
<EPS-DILUTED> (0.43)
</TABLE>
