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 September 30, 1996
OR
[ ] TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______ to ______
Commission File No. 0-17629
ADM TRONICS UNLIMITED, INC.
(Exact name of registrant as specified in its Charter)
Delaware 22-1896032
(State or Other Jurisd- (I.R.S. Employer Identifi-
iction of Incorporation cation Number)
or organization)
224-S Pegasus Avenue, Northvale, New Jersey 07647
(Address of Principal Executive Offices)
Registrant's Telephone Number, including
Area Code: (201) 767-6040
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
the filing requirements for at least the past 90 days:
YES X NO______
Indicate the number of shares outstanding of each of the Registrant's
classes of common stock, as of the latest practicable date:
42,474,907 shares of Common Stock, $.0005 par value,
as of November 8, 1996
ADM TRONICS UNLIMITED, INC.
INDEX
Part I. Financial Information Page Number
Item 1. Consolidated Financial Statements:
Consolidated Balance Sheets - September 30, 1996 and
March 31, 1996 2
Consolidated Statements of Operations - For The Three
Months Ended September 30, 1996 and 1995 and For The
Six Months Ended September 30, 1996 and 1995 3
Consolidated Statements of Changes in Stock holders'
Equity - For The Six Months Ended September 30, 1996 4
Consolidated Statements of Cash Flows - For The Six
Months Ended September 30, 1996 and 1995 5
Notes To Consolidated Financial Statements 6-7
Item 2. Management's Discussion And Analysis of Financial
Condition and Results of Operations 6
1
ADM TRONICS UNLIMITED, INC.
CONSOLIDATED BALANCE SHEETS
September 30, March 31,
1996 1996
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash $ 1,050,760 1,113,626
Certificates of Deposit 107,000 105,390
Securities held to maturity 100,531 100,297
Accounts receivable--trade less allowance
for doubtful accounts of $20,500 365,704 200,758
Inventories:
Raw materials and supplies 162,432 129,809
Finished goods--chemicals 91,425 60,094
Other current assets 176,000 172,282
Total Current Assets 2,053,852 1,882,256
Property and Equipment 49,123 48,629
Equipment held for sale or lease, net of
accumulated depreciation of $50,306 and
$49,599, respectively 390,695 463,500
Note Receivable 85,307 82,306
Equity securities available for sale 20,000 20,000
Loan receivable from officers, bearing
interest at 3% per annum 68,252 68,252
Other Assets 379,279 340,030
Total Assets $ 3,046,508 $2,904,973
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable--trade 111,107 58,426
Accrued expenses and other 21,765 27,431
Prepayments from customer 81,982 124,943
Total Current Liabilities 214,854 210,800
Deferred Sales Revenue 65,860 65,860
Stockholders' Equity 2,765,794 2,628,313
Total Liabilities & Stockholders' Equity $3,046,508 $2,904,973
See accompanying notes to consolidated financial statements
2
ADM TRONICS UNLIMITED, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended SIX MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1996 1995 1996 1995
Revenues:
Net sales $ 467,301 $ 588,124 $907,232 $1,119,138
Costs And Expenses:
Cost of sales 191,471 248,551 332,611 410,656
Selling, general and 261,545 168,891 464,582 486,625
administrative
Total cost and expenses 453,016 417,442 797,193 897,281
Operating Income $ 14,285 $ 170,682 110,039 221,857
Other Income:
Interest,net of expense and 13,990 20,720 27,442 41,589
other income
Net income $ 28,275 $ 191,402 137,481 263,446
Net Income per 0.001 0.005 0.003 0.006
common share
See accompanying notes to consolidated financial statements.
3
ADMTRONICS UNLIMITED, INC.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 1996
(Unaudited)
Common Capital In
Stock Par Excess Of Accumulated
Shares Value Par Value Deficit Total
Balance,
March 31, 1996 42,474,907 21,237 4,819,436 (2,212,360) 2,628,313
Net income
Six months ended
September 30, 1996 137,481 137,481
Balance
September 30, 1996 42,474,907 21,237 4,819,436 (2,074,879) 2,765,794
See accompanying notes to consolidated financial statements
4
ADM TRONICS UNLIMITED, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Six Months Ended September 30,
1996 1995
Cash Flows From Operating Activities:
Net income $ 137,481 $ 263,446
Adjustments to reconcile net income
to net cash flows from operating activities:
Depreciation and amortization 9,788 18,005
Changes in operating assets and liabilities:
Accounts receivable--trade (164,946) (42,478)
Inventories (63,954) 18,771
Other current assets (3,718) (25,845)
Other assets (39,249) (23,743)
Equipment held for sale or lease 72,805 13,637
Accounts payable--trade 52,681 57,178
Customer deposits payable (42,961) 158,039
Accrued expenses and other (5,666) (9,438)
Net cash flows provided by (used in)
operating activities (47,739) 427,572
Cash Flows From Investing Activities:
Investment in treasury notes (100,531) 0
Maturities of treasury notes 100,297 0
Purchase of property and equipment (10,283) (2,579)
Principal payments on advances to
notes receivable (3,000) 28,768
Net changes in certificates of deposit (1,610) (1,743)
Net cash flows provided by (used in)
investing activities (15,127) 24,446
Cash Flows From Financing Activities:
Repayments of notes and leases payable 0 (1,265)
Net change in cash and cash equivalents (62,866) 450,753
Cash--Beginning of year 1,113,626 286,546
Cash--End of period 1,050,760 737,299
Supplemental cash flow information:
Interest paid 567 1,368
Income taxes paid 250 400
See accompanying notes to consolidated financial statements.
5
ADM TRONICS UNLIMITED, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1 - Basis of Presentation:
The consolidated balance sheet at the end of the preceding fiscal year has
been derived from the audited consolidated balance sheet contained in the
Company's annual report on Form 10-KSB for the fiscal year ended March 31,
1996 (the "Form 10-KSB") and is presented for comparative purposes. All
other financial statements are unaudited. In the opinion of management, all
adjustments which include only normal recurring adjustments necessary to
present fairly the financial position, results of operations and changes in
financial positions for all periods presented have been made. The results of
operations for interim periods are not necessarily indicative of the operating
results for the full year.
Footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been omitted in
accordance with the published rules and regulations of the Securities and
Exchange Commission. These consolidated financial statements should be read in
conjunction with the financial statements and notes thereto included in the
Form 10-KSB.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Liquidity and Capital Resources
At September 30, 1996 the Company had cash, and certificates of deposit of
$1,157,760 as compared to $1,219,016 at March 31, 1996. This decrease was the
result of net cash flows used in operating activities and for investing
activities.
Operating Activities
Net cash flows have decreased $470,533 to ($47,739) for the six months ended
September 30, 1996 as compared to net cash flows of $427,572 for six months
ended September 30, 1995. This decrease was primarily the result of reduction
in net income coupled with a major customer deposit received in 1995.
Investing Activities
Capital expenditures consisted of $10,283 for the purchase of property and
equipment coupled with an increase in certificates of deposit of $1,610.
Financing Activities
The Company did not have any cash activities with relation to financing
activities in 1996.
The Company does not have any material external sources of liquidity or unused
sources of funds.
6
Results of Operations
Quarter Ended September 30, 1996
Revenues
Revenues were $467,301 in 1996 as compared to $588,124 in 1995 representing a
decrease of $120,823 or 20%. Revenues from the Company's Sonotron Medical
activities decreased $181,307 offset by an increase in chemical revenues of
$60,484.
Gross Profit
Gross profit of $275,830 in 1996 as compared to $339,573 in 1995 it was
$63,743, or 18.7%, below the gross profit in 1995. Gross profit was 59% of
revenues in 1996 as compared with 58% of revenues in 1995. The gross profit
margin between 1996 and 1995 was comparable.
Operating Income
Operating income in 1996 was $14,285 compared to $170,682 in 1995. Selling
general and administrative expenses increased by $92,654 due to increased legal
and administrative expenses.
Other Income
Other income of $13,990 in 1996 decreased $6,730,from $20,720 in 1995,
principally due to a decrease in interest income.
Results of Operations
Six Months Ended September 30, 1996
Revenues
Revenues were $907,232 in 1996 as compared to $1,119,138 in 1995 representing
a decrease of $211,906 or 18.9%. Revenues from the Company's Sonotron Medical
activities decreased by $280,211 offset by an increase in chemical revenues of
$68,305.
Gross Profit
Gross profit of $574,621 in 1996 as compared to $708,482 in 1995 was $133,861,
or 18.8% below the gross profit in 1995. Gross profit was 63% of revenues in
1996 and 1995. The gross profit margin between 1996 and 1995 was comparable.
Operating Income
Operating income was $110,039 in 1996 compared to an operating income of
$221,8857 in 1995. Selling, general and administrative expenses decreased by
$22,043 due to increased legal and administrative expenses.
Other Income
Other income of $27,442 in 1996 decreased $14,147 from $41,589 in 1995,
principally due to a decrease in interest income.
7
SIGNATURES
Pursuant to the requirements 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.
ADM Tronics Unlimited, Inc.
By:\s\Alfonso DiMino
Dr. Alfonso DiMino
President
And By:\s\Andre' DiMino
Andre' DiMino
Principal Financial Officer
Dated: Northvale, New Jersey
November 7, 1996
