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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-KSB/A
[X] Annual Report under Section 13 or 15(d) of the Securities
Exchange Act of 1934 (Fee required) for the fiscal year ended May
31, 1996
Commission file number 0-17642
CREATIVE LEARNING PRODUCTS, INC.
--------------------------------
(Name of Small Business Issuer in its Charter)
New Jersey 22-2930106
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
150 Morris Avenue, Springfield, NJ 07081
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(Address of Principal Executive Offices)(Zip Code)
(201) 467-0266
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(Issuer's Telephone Number, Including Area Code)
Securities registered under Section 12(b) of the Exchange Act:
NONE
Securities registered under Section 12(g) of the Act:
Common Stock, no par value
--------------------------
(Title of Class)
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
--- ---
Check if there is no disclosure of delinquent filers in
response to Item 405 of Regulation S-B contained in this form, and
no disclosure will be contained, to the best of registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ ]
The issuer's revenues for its most recent fiscal year were
$1,461,906.
The aggregate market value of the voting stock held by non-
affiliates of the registrant as of September 10, 1996 was
$17,296,533.
The number of shares outstanding of each of the registrant's
classes of common equity on September 10, 1996 was 16,637,383
shares of Common Stock, no par value, and no shares of Preferred
Stock, $1.00 par value.
DOCUMENTS INCORPORATED BY REFERENCE
NONE
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Item 6. Management's Discussion and Analysis or Plan of Operations
The following discussion and analysis should be read in
conjunction with the Consolidated Financial Statements included
in Item 7 to this Report.
RESULTS OF OPERATIONS
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SALES
Sales for fiscal 1996 decreased by $26,531 or 2% as compared
with sales for fiscal 1995. The sales decrease was principally
due to an increase in the sales of video products offset by a
larger decrease in children's products and writing instruments.
GROSS PROFIT
Gross profit for fiscal 1996 decreased by $143,719 or 18% as
compared with gross profit for fiscal 1995. The gross profit
margin for fiscal 1996 was 46% as compared with 55% for fiscal
1995. The decline was principally due to sales of videos with
lower gross margins and the adjustment of inventory of children's
products to the lower of cost or market and net realizable
values.
SELLING EXPENSE
Selling expense decreased for fiscal 1996 by $79,417 or 14% as
compared with this expense in fiscal 1995. The decrease was
principally due to a shift in expenses from marketing current
products to emphasis on gaming projects.
GENERAL AND ADMINISTRATIVE EXPENSES
General and administrative expenses decreased for fiscal 1996
by $165,884 or 8% as compared with these expenses in fiscal 1995,
principally due to a reduction in legal and accounting fees.
RESERVE FOR GAMING PROJECTS
Reserve for gaming projects decreased by $2,614,737 or 89% as
compared with reserve for gaming projects in fiscal 1995,
primarily due to the termination of the proposed joint venture
and
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the related theater and play production projects (see the
section "Branson Project" in Item 1 to this Report).
OFFICERS' STOCK OPTION EXPENSE
Officers' stock option expense of $904,688 for fiscal 1995 was
due to options granted to officers during the year to reflect the
excess of the then current market values of the Common Stock over
the transaction prices when issued. No officers' stock option
expense was recorded for fiscal 1996.
DEBT CONVERSION EXPENSE
Debt conversion expense of $398,749 for fiscal 1995 was
attributable to debt converted to the Common Stock during the
year to reflect the excess of the then current market values of
the Common Stock over the transaction prices when issued. No debt
conversion expense was recorded for fiscal 1996.
INTEREST EXPENSE
Interest expense for fiscal 1996 decreased by $9,510 or 13% as
compared with interest expense for fiscal 1995. The interest
expense decrease was principally due to interest on lower
balances of short-term debt in fiscal 1996 offset by interest on
the mortgage on property purchased in fiscal 1996.
NAFTA
The North American Free Trade Act does not have a significant
effect on the consolidated operations.
INFLATION
Inflation does not have an impact on the consolidated
operations.
LIQUIDITY AND CAPITAL RESOURCES
CLP's cash position was $541,610 as of May 31, 1996 as compared
with $122,249 as of May 31, 1995 or an increase of $419,361. Cash
flows from operating activities during fiscal 1996 used cash of
$912,046 due to the net loss of $2,008,478 adjusted primarily for
depreciation and amortization of $273,849, reserve for gaming
projects of $332,424 and an increase in accounts payable of
$476,290 offset by a decrease in prepaid expenses and other
assets of $102,180.
During fiscal 1996, CLPI expended $332,423 for gaming projects
and $1,491,605 for purchases of property resulting in net cash
used in investing activities of $1,824,028.
The net cash provided by financing activities during fiscal
1996 was $3,155,435, consisting of proceeds of long-term
borrowings of $1,072,475, net proceeds of short-term borrowings
of $551,000 and proceeds of $1,531,960 from issuances of stock.
These proceeds funded operational requirements, gaming project
costs and costs of property purchased. Short-term borrowings and
operating liabilities of $1,417,902 were converted to Common
Stock during fiscal 1996.
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Management believes that, as a result of the cash flow from
current operations and the aggregate of $1,400,000 raised through
September 10, 1996 in recent offerings pursuant to Regulation S
under the Securities Act and the exercise of warrants, CLP has
sufficient funds to meet its cash requirements during the next 12
months based on its current level of commitments. Management also
believes that such funds will be supplemented by cash realized
from the sales of equity through private placements and the
exercise of outstanding Common Stock purchase warrants and stock
options.
The Company intends to file a registration statement under the
Securities Act that will register shares of the Common Stock as
soon as practicable after the filing of this Report. It is
management's position that the filing of the registration will
encourage the exercise of some of the underlying outstanding
Common Stock purchase warrants. There can be no assurance that
the Company will be able to raise this additional financing.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
CREATIVE LEARNING PRODUCTS, INC.
Registrant
By: /s/ Peter J. Jegou
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Peter J. Jegou, President
Dated: March 17, 1997
Pursuant to the requirements of the Securities Act of 1933,
this Report has been signed below by the following persons on
behalf of the Registrant on March 14, 1997 in the capacities
indicated:
Signatures Title
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/s/ Peter J. Jegou Principal Executive
-------------------- Officer and Director
(Peter J. Jegou)
/s/ Walter J. Krzanowski Chief Financial Officer
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(Walter J. Krzanowski)
/s/ Carol A. Kulina-Jegou Director
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(Carol A. Kulina-Jegou)
