UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1998
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to __________
Commission File No. 33-55254-01
ARROW MANAGEMENT, INC.
(Exact name of Registrant as specified in its charter)
NEVADA 87-0467339
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
3098 SOUTH HIGHLAND DRIVE, SUITE 460
SALT LAKE CITY, UTAH 84106
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (801) 485-7775
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 such filing
requirements for the past 90 days. [X] Yes [ ] No
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date.
Class Outstanding as of November, 1998
$.001 PAR VALUE CLASS A COMMON STOCK 5,580,700 SHARES
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
BASIS OF REPRESENTATION
General
The accompanying unaudited financial statements have been prepared in
accordance with the instructions to Form 10-Q and therefore, do not include all
information and footnotes necessary for a complete presentation of financial
position, results of operations, cash flows and stockholders' equity in
conformity with generally accepted accounting principles. In the opinion of
management, all adjustments considered necessary for a fair presentation of the
results of operations and financial position have been included and all such
adjustments are of a normal recurring nature. Operating results for the quarter
ended September 30, 1998, are not necessarily indicative of the results that
can be expected for the year ending December 31, 1998.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Results of Operations
The Company had net income of $25,355 for the nine month period ended
September 30, 1998, which includes interest income of $27,965 and government
subsidy of $1,337, less general and administrative expenses of $3,947; as
compared to the nine month period ended September 30, 1997 net income of
$686,849 which includes interest income of $3,327, government subsidy of $541,
and sale of investment security of $1,013,090 less general and administrative
expenses of $4,109 and accrued income taxes of $326,000.
Liquidity and Capital Resources
Net current assets at September 30, 1998 were $712,478 as compared to
net current assets at December 31, 1997 of $683,681. The increase in net current
assets of $28,797 was due to an increase in cash.
The Company is not now, nor has it at any time, been engaged in any
regular business operations. Its activity has consisted of isolated transactions
in parcels of real estate, most of which have now been sold, and acquisition and
sale of securities, which have now also been sold. The Company presently is not
engaging in any significant or regular ongoing costs of operations or debt. It
can be said that the Company is relatively liquid under these circumstances.
However, in the event a business opportunity should become available and the
Company elects to embark on such, there is no assurance the funds of the Company
would be sufficient for such new endeavor. The Company has made no material
commitments for capital expeditures. Until the Company identifies a particular
business opportunity it wishes to pursue, it intends to continue to monitor its
investments and keep its liquid assets invested at reasonable interest rates.
<PAGE>
<TABLE>
<CAPTION>
ARROW MANAGEMENT, INC. AND SUBSIDIARY
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
9/30/98 12/31/97
Unaudited Audited
------------- ------------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash in bank $ 681,504 $ 652,707
Current portion of note receivable 23,000 23,000
Current portion of contracts receivable 9,189 9,189
------------------ --------------------
TOTAL CURRENT ASSETS 713,693 684,896
OTHER ASSETS
Real estate 30,000 30,000
Note receivable - related party 977,000 977,000
Long-term portion of contracts receivable 365,090 368,532
------------------ --------------------
TOTAL OTHER ASSETS 1,372,090 1,375,532
------------------ --------------------
$ 2,085,783 $ 2,060,428
================== ====================
LIABILITIES & EQUITY
CURRENT LIABILITIES
Accrued expenses payable $ 1,215 $ 1,215
------------------ --------------------
TOTAL CURRENT LIABILITIES 1,215 1,215
Minority interest in subsidiary 191,000 191,000
STOCKHOLDERS' EQUITY Common Stock $.001 par value:
Authorized - 50,000,000 shares
Issued and outstanding - 5,580,700 shares 5,581 5,581
Additional paid-in capital 2,380,667 2,380,667
Deficit accumulated during development stage (492,680) (518,035)
------------------ --------------------
TOTAL STOCKHOLDERS' EQUITY 1,893,568 1,868,213
------------------ --------------------
$ 2,085,783 $ 2,060,428
================== ====================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ARROW MANAGEMENT, INC. AND SUBSIDIARY
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
1/14/88
For the three months For the nine months (Date of
ended Sept 30, ended Sept 30, inception) to
1998 1997 1998 1997 9/30/98
Unaudited Unaudited Unaudited Unaudited Unaudited
-------------- ------------- ------------- -------------- ------------
<S> <C> <C> <C> <C> <C>
Net sales $ - 0 - $ - 0 - $ - 0 - $ - 0 - $ 572,561
Cost of sales - 0 - - 0 - - 0 - - 0 - 489,824
-------------- ------------- ------------- -------------- ------------
GROSS PROFIT - 0 - - 0 - - 0 - - 0 - 82,737
Loss from impairment of land value - 0 - - 0 - - 0 - - 0 - 1,955,000
General and administrative expenses 1,278 2,759 3,947 4,109 229,763
-------------- ------------- ------------- -------------- ------------
OPERATING (LOSS) (1,278) (2,759) (3,947) (4,109) (2,102,026)
Other Income
Sale of securities - 0 - 1,013,090 - 0 - 1,013,090 1,443,680
Interest income 7,544 1,828 27,965 3,327 119,039
Consulting - 0 - - 0 - - 0 - - 0 - 5,000
Government subsidy 686 280 1,337 541 41,627
-------------- ------------- ------------- -------------- ------------
TOTAL OTHER INCOME 8,230 1,015,198 29,302 1,016,958 1,609,346
-------------- ------------- ------------- -------------- ------------
NET INCOME (LOSS)
BEFORE INCOME TAXES 6,952 1,012,439 25,355 1,012,849 (492,680)
Provision for income taxes - 0 - 326,000 - 0- 326,000 - 0 -
-------------- ------------- ------------- -------------- ------------
NET INCOME (LOSS) $ 6,952 $ 686,439 $ 25,355 $ 686,849 $ (492,680)
============== ============= ============= ============== ============
Net (loss) per weighted
average common shares $ .00 $ .00 $ .00 $ .00
============== ============= ============= ==============
Weighted average number of
common shares used to compute
net (loss) 5,580,700 5,580,700 5,580,700 5,580,700
============== ============= ============= ==============
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ARROW MANAGEMENT, INC. AND SUBSIDIARY
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
Deficit
Accumulated
Common Stock Additional During
Par Value $0.001 Paid -in Development
Shares Amount Capital Stage
---------- -------------- ------------- -------------
<S> <C> <C> <C> <C>
Balance, 1/14/88
(Date of inception) - 0 - $ - 0 - $ - 0 - $ - 0 -
Issuance of common stock (restricted)
at $.002 per share, 1/14/88 1,000,000 1,000 1,000
Acquisition of subsidiary(1) 5,250,700 5,251 (3,251) (1,970)
Net loss for period (1,970)
---------- -------------- ------------- -------------
Balance at 12/31/88 6,250,700 6,251 (2,251) (3,920)
Net loss for year (20)
---------- -------------- ------------- -------------
Balance at 12/31/89 6,250,700 6,251 (2,251) (3,940)
Net loss for year (20)
---------- -------------- ------------- -------------
Balance at 12/31/90 6,250,700 6,251 (2,251) (3,970)
Assets acquired by subsidiary 4,420,000
Minority interest adjustment (12,000)
Net loss for year (20)
---------- -------------- ------------- -------------
Balance at 12/31/91 6,250,700 6,251 4,405,749 (3,980)
Debentures cancelled (2,000,000)
Assets acquired by subsidiary 1,600,000
Minority interest adjustment (8,000)
Net loss for year (891)
---------- -------------- ------------- -------------
Balance at 12/31/92 6,250,700 6,251 3,998,749 (4,871)
Minority interest adjustment (2,000)
Net loss for year (16,763)
---------- -------------- ------------- -------------
Balance at 12/31/93 6,250,700 6,251 3,995,749 (21,634)
Net loss for year (41,004)
---------- -------------- ------------- -------------
Balance at 12/31/94 6,250,700 6,251 3,995,749 (62,638)
Trade and media credits cancelled (320,000) (320) (1,446,432)
Minority interest adjustment 19,000
Net loss for year (1,970,141)
---------- -------------- ------------- -------------
Balances at 12/31/95 5,930,700 5,931 2,568,317 (2,022,779)
Reissuance of erroneously cancelled
shares during 1995 110,000 110 (110)
Cancellation of previously issued
shares related to acquisition of
subsidiary (460,000) (460) 460
Minority interest adjustment (54,000)
Net income for year 11,826
---------- -------------- ------------- -------------
Balance at 12/31/96 5,580,700 $ 5,581 $ 2,514,667 $ (2,010,953)
Minority interest adjustment (134,000)
Net income for period 1,492,918
---------- -------------- ------------- -------------
Balance at 12/31/97 5,580,700 $ 5,581 $ 2,380,667 $ (518,035)
Net income for period 25,355
---------- -------------- ------------- -------------
Balances at 9/30/98 5,580,700 $ 5,581 $ 2,380,667 $ (492,680)
========== ============== ============= =============
(1) Acquisition actually occurred on September 30, 1993, but is reflected
earlier under the pooling-of-interests method of accounting.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
ARROW MANAGEMENT, INC. AND SUBSIDIARY
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
1/14/88
For the nine months (Date of
ended Sept 30, inception) to
1998 1997 6/30/98
-------------- -------------- --------------
<S> <C> <C> <C>
OPERATING ACTIVITIES
Net (loss) $ 25,355 $ 686,849 $ (492,680)
Adjustments to reconcile net
(loss) to cash provided (required)
by operating activities:
Amortization - 0 - - 0 - 100
Cost of land sold - 0 - - 0 - 470,000
Cost of securities sold - 0 - 69,498 100,000
Non-cash income - 0 - - 0 - (5,000)
Itex Trade Dollars used - 0 - - 0 - 8,248
Loss from impairment of land value - 0 - - 0 - 1,955,000
Changes in operating assets and liabilities:
Contracts receivable 3,442 21,247 (374,279)
Accrued expenses - 0 - 1,000 1,215
Accrued income tax - 0 - 326,000 - 0 -
-------------- -------------- --------------
NET CASH PROVIDED (REQUIRED)
BY OPERATING ACTIVITIES 28,797 1,104,595 1,662,604
INVESTING ACTIVITIES
Purchase of real estate - 0 - - 0 - (105,000)
Loan to related party - 0 - - 0 - (1,000,000)
Organization costs - 0 - - 0 - (100)
-------------- -------------- --------------
NET CASH (USED) BY
INVESTING ACTIVITIES - 0 - - 0 - (1,105,100)
FINANCING ACTIVITIES
Proceeds from sale of common stock(1) - 0 - - 0 - 124,000
Loans - 0 - - 0 - 10,417
Repayments - 0 - - 0 - (10,417)
-------------- -------------- --------------
NET CASH PROVIDED (REQUIRED)
BY FINANCING ACTIVITIES - 0 - - 0 - 124,000
INCREASE (DECREASE) IN CASH
AND CASH EQUIVALENTS 28,797 1,104,594 681,504
Cash and cash equivalents
at beginning of period 652,707 21,844 - 0 -
-------------- -------------- --------------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 681,504 $ 1,126,438 $ 681,504
============== ============== ==============
SUPPLEMENTAL INFORMATION
Cash paid for interest $ - 0 - $ - 0 - $ 676
============== ============== ==============
</TABLE>
SUPPLEMENTAL INVESTING ACTIVITY DISCLOSURE
In July, 1992, Panorama issued 320,000 shares of stock for assets with a cost of
$1,600,000. These shares were returned to the Company in December, 1995 in
connection with the rescission agreement.
(1) Stock of subsidiary was $122,000.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ARROW MANAGEMENT, INC.
Dated: November 10, 1998 s\Krista Nielson
-------------------------------------------------
Krista Nielson, President CEO and Director
Dated: November 10, 1998 s\Sasha Belliston
-------------------------------------------------
Sasha Belliston, Secretary/Treasurer and Director
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from ARROW
MANAGEMENT, INC. September 30, 1998 financial statements and is qualified
in its entirety by reference to such financial statements.
</LEGEND>
<CIK> 0000860401
<NAME> ARROW MANAGEMENT, INC.
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 681,504
<SECURITIES> 0
<RECEIVABLES> 9,189
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 713,693
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 2,085,783
<CURRENT-LIABILITIES> 1,215
<BONDS> 0
0
0
<COMMON> 5,581
<OTHER-SE> 1,887,987
<TOTAL-LIABILITY-AND-EQUITY> 2,085,783
<SALES> 0
<TOTAL-REVENUES> 27,965
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 3,947
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 25,355
<INCOME-TAX> 0
<INCOME-CONTINUING> 25,355
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 25,355
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
