<PAGE> 1
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(MARK ONE)
[ X ] QUARTERLY REPORT PURSUANT SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1998
[ ] TRANSITION REPORT PURSUANT SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 0-17756
-------
CONSULIER ENGINEERING, INC.
- --------------------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
FLORIDA 59-2556878
------------------------------ -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
169 TEQUESTA DRIVE - SUITE 31E, TEQUESTA, FL 33469
- --------------------------------------------------------------------------------
(Address of principal executive offices)
(561) 745-9149
- --------------------------------------------------------------------------------
(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 _
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
As of November 6, 1998, there were 4,888,918 outstanding shares of common stock,
par value $0.01 per share.
1
<PAGE> 2
CONSULIER ENGINEERING, INC. AND SUBSIDIARIES
INDEX
PART I. FINANCIAL INFORMATION
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
Item 1. Financial Statements
Consolidated Balance Sheets at
September 30, 1998 (Unaudited)
and December 31, 1997 . . . . . . . . . . . . . . . . . . 3
Consolidated Statements of Income at three
and nine month periods ended September 30,
1998 and 1997 (Unaudited) . . . . . . . . . . . . . . . . 4
Consolidated Statements of Cash Flows at
nine month periods ended September 30, 1998
and 1997 (Unaudited) . . . . . . . . . . . . . . . . . . 5
Notes to Consolidated Financial
Statements (Unaudited) . . . . . . . . . . . . . . . . . 6
Item 2. Management's Discussion and Analysis or
Plan of Operation . . . . . . . . . . . . . . . 10
PART II. OTHER INFORMATION
Item 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . 15
Item 2. Changes in Securities . . . . . . . . . . . . . . . . . . 15
Item 3. Defaults upon Senior Securities . . . . . . . . . . . . . 15
Item 4. Submission of Matters to a Vote of Security
Holders . . . . . . . . . . . . . . . . . . . . 15
Item 5. Other Information . . . . . . . . . . . . . . . . . . . . 15
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . 16
SIGNATURES . . . . . . . . . . . . . . . . . .. . . . . . . . . . 17
</TABLE>
2
<PAGE> 3
CONSULIER ENGINEERING, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
ASSETS 1998 1997
- -------------------------------------------------- -------------- ------------
(UNAUDITED)
<S> <C> <C>
CURRENT:
Cash (Note 1) $ 304,936 $ 7,013
Receivables (Note 2) 451,558 664,154
Receivables - related parties (Note 11(a)) 941,698 861,585
Notes receivable - related parties (Note 11(c)) 430,558 430,558
Inventories (Notes 1 and 3) 1,981,564 2,058,263
Other current assets 12,747 105,700
------------ ------------
TOTAL CURRENT ASSETS 4,123,061 4,127,273
Property and equipment, net (Notes 1, 4 and 6) 2,127,173 1,537,554
Limited partnership interests (Notes 1 and 5) 2,233,636 2,132,798
Notes receivable - related parties (Note 11(b)) 1,741,798 1,741,797
Non-current inventory (Notes 1 and 3) 600,000 600,000
Patents and other assets 199,423 239,366
------------ ------------
$ 11,025,091 $ 10,378,788
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
- --------------------------------------------------
LIABILITIES:
CURRENT :
Accounts payable and accruals $ 250,868 $ 250,765
Income taxes (Notes 1 and 8) 0 5,231
Notes payable - banks (Note 6(a)) 288,804 1,748,775
Note payable - related parties (Note 6(c)) 2,419,897 352,297
------------ ------------
TOTAL CURRENT LIABILITIES 2,959,569 2,357,068
Bonds payable (Note 6(b)) 1,275,000 1,275,000
Deferred income taxes (Notes 1 and 8) 17,253 14,766
------------ ------------
TOTAL LIABILITIES 4,251,822 3,646,834
------------ ------------
STOCKHOLDERS' EQUITY: (NOTES 1 AND 9)
Common stock of $.01 par value:
Authorized ---25,000,000 shares;
Issued---5,136,066 shares in 1998 and 5,124,066 in 1997 51,361 51,241
Additional paid-in capital 2,955,081 2,856,202
Retained earnings 4,235,190 4,292,874
------------ ------------
7,241,632 7,200,317
Less treasury stock at cost - 247,148 shares
in 1998 and 1997
(468,363) (468,363)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 6,773,269 6,731,954
------------ ------------
$ 11,025,091 $ 10,378,788
============ ============
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
3
<PAGE> 4
CONSULIER ENGINEERING, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------------------- -----------------------------
1998 1997 1998 1997
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
REVENUES:
Net sales $ 680,188 $ 733,170 $ 2,071,744 $ 2,500,886
----------- ----------- ----------- -----------
OPERATING COSTS AND EXPENSES:
Cost of goods sold 390,757 363,818 1,158,305 1,413,177
Selling, general and
administrative 663,085 559,970 1,683,975 1,376,413
Research and development expense 3,450 42,938 41,783 123,988
----------- ----------- ----------- -----------
1,057,292 966,726 2,884,063 2,913,578
----------- ----------- ----------- -----------
Operating loss (377,104) (233,556) (812,319) (412,692)
----------- ----------- ----------- -----------
OTHER INCOME (EXPENSE):
Investment income - related party 370,655 344,502 874,439 995,150
Interest income - related parties 56,800 88,433 171,258 262,546
Interest expense - other (79,010) (63,237) (205,539) (157,536)
Other income 32,649 26,360 64,718 46,596
Loss on investment-HRO (150,242) 0 (150,242) 0
----------- ----------- ----------- -----------
230,852 396,058 754,634 1,146,756
----------- ----------- ----------- -----------
(Loss) income before income taxes (146,252) 162,502 (57,685) 734,064
Income taxes (Notes 1 and 8) (33,328) 70,293 0 276,229
----------- ----------- ----------- -----------
Net (loss) income $ (112,924) $ 92,209 $ (57,685) $ 457,835
=========== =========== =========== ===========
Basic and diluted earnings per share $ (0.02) $ 0.02 $ (0.01) $ 0.09
=========== =========== =========== ===========
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
4
<PAGE> 5
CONSULIER ENGINEERING, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Note 10)
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
-----------------------------
1998 1997
----------- -----------
<S> <C> <C>
OPERATING ACTIVITIES:
Net (loss) income $ (57,685) $ 457,835
Adjustments to reconcile net income to net
cash used in operations:
Depreciation 77,604 63,009
Amortization 18,834 14,227
Investment income - related party (856,994) (995,150)
Changes in operating assets and liabilities:
Decrease (increase) in receivables and other current assets 157,862 (84,901)
Decrease (increase) in inventories 76,699 (538,784)
Decrease (increase) in other assets 25,669 (89,741)
Increase in accounts payable and accruals 103 43,464
(Decrease) in income taxes payable (2,744) (45,342)
----------- -----------
NET CASH USED IN OPERATIONS (560,652) (1,175,383)
----------- -----------
INVESTING ACTIVITIES:
Property and equipment additions, net of dispositions (589,619) (1,326,321)
Distributions from partnership interest 968,951 884,025
Investment in BioSafe Systems, LLC (147,273) 0
Loans to related parties (80,113) (168,821)
----------- -----------
NET CASH PROVIDED (USED IN) INVESTING ACTIVITIES 151,946 (611,117)
----------- -----------
FINANCING ACTIVITIES:
Repayment of bank and other loans (1,459,971) (2,018)
Borrowings 2,067,600 1,452,329
Sales of common stock 5,250 0
Disgorgement of stock sale profits 93,750 0
Purchase of stock for treasury and stock options (Note 9(c)) 0 (166,538)
----------- -----------
NET CASH PROVIDED BY FINANCING ACTIVITIES 706,629 1,283,773
----------- -----------
INCREASE (DECREASE) IN CASH 297,923 (502,727)
CASH, BEGINNING OF PERIOD 7,013 557,639
----------- -----------
CASH, END OF PERIOD $ 304,936 $ 54,912
=========== ===========
</TABLE>
SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.
5
<PAGE> 6
CONSULIER ENGINEERING, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1. 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 instructions to Form 10-QSB and Regulation S-B.
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 (which include only normal
recurring adjustments) considered necessary for a fair presentation have been
included. For further information, refer to the consolidated financial
statements and footnotes thereto included in the Company's annual report on Form
10-KSB for the year ended December 31, 1997.
In order to maintain consistency and comparability between periods presented,
certain amounts have been reclassified from the previously reported financial
statements in order to conform with the financial statement presentation of the
current period.
The consolidated financial statements include Consulier Engineering, Inc. (the
"Company") and its wholly-owned subsidiaries, Southeast Automotive Acquisition
Corporation, Consulier Business Services, Inc., and C-6 Products Inc. All
intercompany balances and transactions have been eliminated.
All per share data and numbers of shares of the Company's common stock, par
value $.01 per share ("common stock") for all periods included in the financial
statements and notes thereto have been adjusted to reflect a two-for-one stock
split in the form of a 100% stock dividend that became effective April 15, 1998.
6
<PAGE> 7
CONSULIER ENGINEERING, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 2. INVENTORIES
Inventories are stated at the lower of cost, determined on a first-in, first-out
basis, or market. Major classes of inventory are summarized as follows:
<TABLE>
<CAPTION>
September 30, December 31,
1998 1997
------------ ------------
<S> <C> <C>
Raw materials $ 55,551 $ 26,161
CRA-Z Soap 1,000,627 1,010,561
Finished goods 969,386 1,065,541
Obsolescence reserve (44,000) (44,000)
----------- -----------
$ 1,981,564 $ 2,058,263
=========== ===========
Non-Current Inventory $ 600,000 $ 600,000
=========== ===========
</TABLE>
The non-current portion of inventory consists of $600,000 of CRA-Z soap which
the company believes will take longer than one year to sell.
7
<PAGE> 8
CONSULIER ENGINEERING, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 3. LIMITED PARTNERSHIP INTEREST
The limited partnership interest consists of Consulier's investment in Adams,
Viner & Mosler, Ltd. ("AVM") This investment is accounted for under the equity
method. Following is a summary of the operations of AVM (in thousands):
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
------- ------- ------- -------
<S> <C> <C> <C> <C>
Revenues $14,493 $10,305 $34,674 $29,556
Costs and expenses 6,520 4,561 16,843 13,403
------- ------- ------- -------
Net income $ 7,973 $ 5,744 $17,831 $16,153
======= ======= ======= =======
Company's share of
Net income $ 371 $ 340 $ 857 $ 978
======= ======= ======= =======
</TABLE>
Consulier owned approximately 7% and 9% of AVM's capital as of September 30,
1998 and 1997, respectively. Based on capital and earnings distributions
provided in the partnership agreement, Consulier was allocated approximately 5%
and 6% of AVM's earnings at September 30, 1998 and 1997, respectively.
8
<PAGE> 9
CONSULIER ENGINEERING, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 4. EARNINGS PER SHARE
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
--------------------------- ----------------------------
<S> <C> <C> <C> <C>
Numerator:
Net (loss) income,
numerator for basic and diluted
Earnings per share $ (112,924) $ 92,209 $ (57,685) $ 457,835
Denominator:
Denominator for basic Earnings
per share, weighted-average shares 4,888,918 4,956,486 4,884,962 4,981,898
Effect of dilutive securities:
Stock options 49,539 62,514 57,831 67,682
Warrants 11,045 -- 12,788 --
----------- ---------- ----------- ----------
Dilutive potential common shares 60,584 62,514 70,619 67,682
Denominator for diluted Earnings
per share, adjusted weight-
average shares 4,949,502 5,019,000 4,955,581 5,049,580
=========== ========== =========== ==========
Basic earnings per share (.02) .02 (.01) .09
Diluted earnings per share (.02) .02 (.01) .09
</TABLE>
Options to purchase 25,000 shares of common stock at prices ranging from $2.19
to $2.50 per share were not included in the computation of diluted earnings per
share because the options exercise price was greater than the average market
price of the common shares and, therefore, the effect would be antidilutive.
9
<PAGE> 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
RESULTS OF OPERATIONS
Consulier Engineering, Inc. ("Consulier") experienced a decrease in net income
for the third quarter of 1998 and also year to date. For the third quarter, net
income decreased $204,503 or 222% to a loss of $112,924 from income of $92,209
in 1997. Year to date, net income decreased $515,520 or 113% to a loss of
$57,655 from income of $457,835 in 1997.
Net sales of the Company's Southeast Automotive parts distribution segment
represent 99% of Consulier's net sales. Sales for this segment decreased
$430,934 or 17% to $2,054,224 for the nine month period in 1998 compared to
$2,485,158 in 1997. Selling, General and Administrative expenses were $961,846
for the nine months of 1998 compared to $964,528 in 1997, a decrease of $2,682.
Other Income/Expense increased $62,779 in the nine month period due to an
increase in interest expense. The automotive parts distribution segment
experienced a loss before taxes of $261,663 in the nine month period of 1998
compared to a loss before taxes of $25,504 for the same period in 1997.
In April 1997 Consulier contracted to purchase six patents for tool and ladder
related products. A wholly owned subsidiary was formed, C-6 Products, Inc., to
develop, manufacture, sell and distribute the products. The ladder Tool
Topper(TM) line of products is currently in production. The products segment had
$374,190 of expenses in the nine month period of 1998 compared to $163,366 in
1997. The products segment has not recorded any income in the nine month period
of 1998. The major expenditures have been for research and development,
marketing and travel. The first production run of 10,000 units was ready for
distribution in September.
Investment income from Consulier's AVM limited partnership interest was $856,995
in the first nine months of 1998, a 12% decrease from 1997 income of $978,978.
The High Risk Opportunities Fund Ltd. ("HRO") has been placed in liquidation
under Cayman Islands law. The objective of the Fund was to achieve substantial
capital appreciation through investment in a broad and unrestricted range of
financial instruments. HRO focused primarily on leveraged investments in
fixed-income securities and derivatives in emerging markets. HRO's Russian
position consisted of leveraged investments in ruble-denominated, short-term
Russian government securities ("GKOs") (generally
10
<PAGE> 11
accessed through total return swaps and structured notes), with the ruble/dollar
currency risk hedged through non-deliverable forward contracts ("NDFs") with
Western European and U.S. banks.
During the second half of August 1998, the Russian government announced various
emergency measures apparently designed to, among other things, improve the
Russian government's financial position and forestall the collapse of the
Russian banking system. These misguided measures included a devaluation of the
ruble, a 90 day moratorium on servicing of foreign debts including forward
foreign exchange contracts and a forced restructuring (i.e. default) on certain
sovereign local currency debt, including virtually all their GKOs. The
government ministers who announced such measures were subsequently fired by
President Yeltsin and the Russian government remains in a chaotic state to this
day.
Since the announcement of the restructuring, the official GKO market in Russia
has been closed. The Russian default and devaluation also led to substantial
declines in the value of emerging market debt worldwide as investors fled to the
safety of U.S. Treasuries. These events caused severe losses for many Western
banks and investment funds, including HRO. The liquidators now have complete
control of HRO assets and authority to pursue and settle claims. There can be no
certainty regarding the ultimate value of HRO. With that being the case, the
best current course of action is to carry the HRO fund at a zero value on the
Company's books. A loss on investment in the amount of $150,242 was recorded in
September.
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 1998, Consulier's cash totaled $304,936 as compared to $7,013
at December 31, 1997. During the nine month period Consulier's cash increased
$297,923. The Company has relied on cash flows from its limited partnership
investment in AVM supplemented, as necessary, by bank borrowings and loans from
Chairman of the Board Warren B. Mosler to finance working capital and capital
expenditures.
The ability of Consulier to continue to generate cash flow in excess of its
normal operating requirements depends almost entirely on the performance of its
limited partnership investment in AVM. Consulier cannot, with any degree of
assurance, predict whether there will be a continuation of the net return
experienced in the period that the AVM limited partnership
11
<PAGE> 12
interest has been owned. However, Consulier does not expect that the rate of
return will decline to the point where Consulier has negative cash flow.
Furthermore, although AVM has given Consulier no indication of any intention on
its part to redeem the partnership interest, there can be no assurance that AVM
will not do so in the future. Consulier believes that it may require additional
financing to complete agreements which are currently in place. The timing and
amount of Consulier's additional financing needs will depend, among other
things, upon the timing of Tool Topper(TM) manufacturing and sales.
FUTURE OUTLOOK
Based on AVM's current operations and operating results, Consulier expects
continued returns in 1998 on its limited partnership investment. However, there
is no guarantee that the returns of the past can be maintained.
Consulier's automotive parts wholesale distribution business experienced a
decrease in sales in the six months of 1998 but management is now seeing an
improvement in sales due to the introduction of new product lines. This
business, Southeast Automotive, intends to expand its business through the
development of a wider customer base. At the end of 1997 Southeast had
approximately $1,600,000 of hand cleaner CRA-Z Soap in inventory. A portion,
$600,000 of this inventory is classified as non-current because Consulier
believes it will take longer than one year to sell. Southeast's CRA-Z soap
retail presence is rapidly growing. The product is now available at Paccar
Automotives chain of 152 Al's and Grand Auto auto parts stores. These stores are
located throughout six western states. The Southeast CRA-Z Soap Web Site has
generated a substantial amount of brand recognition. In addition, retail sales
from the website have commenced and "virtual" distributors have been signed up
to sell the product worldwide.
In 1997, Consulier entered into a contract for the purchase of six patents for
tools and related products. Several are related to work platform and tool
holding attachments to ladders tentatively being called our Tool Topper(TM) line
of products. The balance of the patents are related to powered hack saws powered
by 110/220 volt AC, pneumatic and battery power sources. A Florida corporation
was established to develop, manufacture, sell and distribute the patented
products. This corporation, C-6 Products, Inc. ("C-6"), is a wholly owned
subsidiary of Consulier. During 1998, C-6 is continuing development of the Tool
Topper(TM) Workstation product. This patented product is
12
<PAGE> 13
designed so it can be easily and quickly attached to any stepladder, converting
it into a work platform. C-6 has completed design and rapid prototyping of the
Tool Topper(TM) Workstation. An agreement has been reached with a large
production plastic injection molding company to manufacture our Tool Topper(TM)
Workstation for us. Production tooling orders were placed for all required
tools. An initial order for 10,000 units was completed in September 1998.
Advertising for the ToolTopper(TM) commenced in October. This resulted in direct
sales from the ToolTopper(TM) Web site as well as the toll free order
fulfillment system. We have also begun marketing the ToolTopper(TM) to regional
as well as nationwide retail chains. The ToolTopper(TM) will be featured
nationally on the QVC Television Shopping Network in November.
In October 1997, Consulier purchased a minority equity interest in BioSafe
Systems, LLC., a New Jersey limited liability corporation ("BioSafe"). Biosafe
develops and markets environmentally safe products, alternatives to
traditionally toxic pesticides.
Recent public concern over environmental practices and the effect of toxic
chemicals on the environment are producing increasing pressure on agricultural
concerns to limit their use. BioSafe uses peroxigen chemistry as a pesticide,
algaecide and fungicide. Peroxigen chemistry uses the power of free radical
oxidation to kill all forms of micro-organisms that may be pathogenic to plants,
without causing harm to the plant. Peroxigens immediately biodegrade upon
reacting with either micro-organisms or organic material such as soil, into
components of oxygen and water leaving behind no toxic residues.
BioSafe's initial product, ZeroTol(TM), utilizes a formulation using peroxigens
as the principal active ingredients. No other company currently has or has
requested a US EPA registration for the use of peroxigens for these purposes.
BioSafe's federal EPA registration for its ZeroTol(TM) product was received in
1998 permitting its use on ornamental plants and turf applications.
Additionally, the U.S. Patent Office granted a patent for ZeroTol(TM).
Consulier has an agreement to purchase up to a 40% equity interest in BioSafe.
During 1998 management has continued to increase its investment in BioSafe.
BioSafe sales have improved in 1998 as new distributors and product users have
been added and advertising in trade magazines initiated. BioSafe has
13
<PAGE> 14
established a national distribution with over 20 distributors in 50 individual
locations. Additionally a distributor has been added in South America.
Advertising is continuing in periodicals focused on the greenhouse industry and
is continuing to identify potential new users.
In August BioSafe completed the move of its headquarters from New Jersey to
Glastonbury, CT. Their new facility will provide larger quarters for product
development and evaluation and will provide necessary warehouse space and
distribution facilities.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
Except for the historical information contained in this report, certain matters
discussed in Management's Discussion and Analysis or Plan of Operation are
forward looking statements which involve risks and uncertainties including, but
not limited to statements regarding Consulier's planned capital expenditure
requirements, cash and working capital requirements, Consulier's expectations
regarding the adequacy of current financing arrangements, product demand and
market growth, other statements regarding future plans and strategies,
anticipated events or trends, and similar expressions concerning matters that
are not historical facts. It should be noted that Consulier's actual results
could differ materially from those contained in such forward looking statements
mentioned above due to adverse changes in any number of factors that affect
Consulier's business including, without limitation, risks associated with
investing in and the marketing of Consulier's Tool Topper(TM) and CRA-Z Soap
products, manufacturing and supply risks, risks concerning the protection of
Consulier's patents, reliance upon distributors, regulatory risks, risks of
expansion, product liability and other risks described herein.
14
<PAGE> 15
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
As of September 30, 1998, there were no legal proceedings pending against the
Company or its subsidiaries nor did the Company have any knowledge of any
proceedings which were being contemplated.
ITEM 2. CHANGES IN SECURITIES
During the third quarter of 1998 there were no changes in the instruments
defining the rights of the holders of any class of registered securities, nor
were the rights evidenced by any class of registered securities limited or
qualified by the issuance or modification of any other class of securities.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
During the third quarter of 1998, there have been no material defaults in the
payment of principal, interest, or any other material default with respect to
any indebtedness, nor has there been any arrearage in the payment of dividends
of any class of stock.
ITEM 4. SUBMISSION OF MATTERS tO A VOTE OF SECURITY HOLDERS
During the third quarter of 1998, the Company did not submit any matters to a
vote of security holders.
ITEM 5. OTHER INFORMATION
The Company has no other information to report which might otherwise be reported
under Form 8-K.
15
<PAGE> 16
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) EXHIBITS REQUIRED BY ITEM 601 OF REGULATION S-K
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
------- -----------
<S> <C>
27 Financial Data Schedule (for SEC use
only)
</TABLE>
(B) CURRENT REPORTS ON FORM 8-K
The Company did not file any reports on Form 8-K during the three month period
ended September 30, 1998.
16
<PAGE> 17
SIGNATURE
In accordance with the requirements of the Exchange Act, the registrant, has
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
CONSULIER ENGINEERING, INC.
---------------------------
(Registrant)
/s/ Ralph D. Butler
----------------------
Date: November 11, 1998 Ralph D. Butler
Secretary/Treasurer
Chief Financial Officer
17
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 305
<SECURITIES> 0
<RECEIVABLES> 1,868
<ALLOWANCES> 44
<INVENTORY> 1,982
<CURRENT-ASSETS> 4,123
<PP&E> 2,779
<DEPRECIATION> 652
<TOTAL-ASSETS> 11,025
<CURRENT-LIABILITIES> 2,960
<BONDS> 1,275
0
0
<COMMON> 51
<OTHER-SE> 6,773
<TOTAL-LIABILITY-AND-EQUITY> 11,025
<SALES> 2,072
<TOTAL-REVENUES> 2,072
<CGS> 1,158
<TOTAL-COSTS> 1,158
<OTHER-EXPENSES> 1,726
<LOSS-PROVISION> 0
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