FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 or 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Three Months Ended March 31, 2000 Commission File Number 0-19047
--------------
INCORPORATED IN FLORIDA IRS IDENTIFICATION NO. 59-2618503
FOOD TECHNOLOGY SERVICE, INC.
502 Prairie Mine Road, Mulberry, FL 33860
(863) 425-0039
"Indicate by check mark whether the registrant has filed all annual,
quarterly and other reports required to be filed with the Commission within
the past 90 days and in addition has filed the most recent annual report
required to be filed. Yes X . No ."
-- --
"Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the last practicable date."
Outstanding as of March 31,
Class 1999 2000
----- ---- ----
Common Stock $.01 Par Value 10,243,401 Shares 10,331,201 Shares
<PAGE>
FOOD TECHNOLOGY SERVICE, INC.
(A Development Stage Company)
BALANCE SHEET
MARCH 31, DECEMBER 31,
2000 1999
---- ----
(unaudited) *
ASSETS
------
Current Assets:
Cash $ 44,257 $ 20,937
Accounts Receivable 80,723 51,125
Due from Employees 18,176 66,175
Inventory 3,794 3,886
---------- ----------
Total Current Assets 146,950 142,123
Property and Equipment:
Cobalt 1,310,272 1,310,272
Furniture and Equipment 1,673,876 1,659,854
Building 2,883,675 2,883,675
Less Accumulated Depreciation (2,547,898) (2,482,167)
---------- ----------
Total Property & Equipment 3,319,925 3,371,634
Land 171,654 171,654
Other Assets:
Deposits 5,000 5,000
Total Assets $ 3,643,529 $ 3,690,411
=========== ==========
LIABILITIES AND STOCKHOLDERS EQUITY
-----------------------------------
Current Liabilities:
Accounts Payable $ 14,211 $ 48,513
Revolving Credit Line 250,000 250,000
---------- ----------
Total Current Liabilities 264,211 298,513
Financing Agreement and Debenture Payable 977,397 954,476
Stockholders' Equity:
Common Stock $.01 par value,
200,000,000 shares authorized
10,331,201 shares 2000 103,312
10,316,201 shares 1999 103,162
Paid in Capital 11,464,191 11,438,631
Deficit Accumulated During Development (9,165,582) (9,104,371)
---------- ----------
Total Equity 2,401,921 2,437,422
Total Liabilities and Stockholders' Equity $ 3,643,529 $ 3,690,411
========== ==========
* Condensed from audited financial statements
<PAGE>
FOOD TECHNOLOGY SERVICE, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
FOR THE QUARTER ENDED MARCH 31,
December 11, 1985
(Inception) Through
March 31, 2000 2000 1999
---------------- ---- ----
(unaudited) (unaudited) (unaudited)
Net Sales $ 2,396,743 $ 235,866 $ 72,348
Processing Costs: 2,456,720 71,939 58,675
---------- --------- --------
Profit (Loss) from Operations (59,977) 163,927 13,673
General Administrative and Development 5,323,574 126,745 148,941
Depreciation 2,553,471 65,730 67,188
Interest Expense 1,762,087 32,663 22,655
---------- --------- --------
Profit (Loss) (9,699,109) (61,211) (225,111)
Other Income (Expense):
Foreign Exchange Gain 434,719 0 0
Interest Income 188,897 0 0
Other (90,089) 0 0
---------- --------- --------
Loss Before Income Taxes (9,165,582) (61,211) (225,111)
Income Taxes 0 0 0
---------- --------- --------
Net Loss ($9,165,582) ($61,211) ($225,111)
========== ========= ========
Net Loss per Common Share ($0.89) ($0.006) ($0.02)
========== ========= ========
NOTE 1: BASIS OF PRESENTATION
The financial information included herein is unaudited; however, such
information reflects all adjustments (consisting solely of normally
recurring adjustments) which are, in the opinion of management, necessary
for a fair statement of results for the interim period.
The results of operations for the three month periods ended March 31, 2000
are not necessarily indicative of the results to be expected for the full
year.
<PAGE>
FOOD TECHNOLOGY SERVICE, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
December 11, 1985 Three Months Three Months
(Inception) Through Ended Ended
March 31, 2000 March 31, 2000 March 31, 1999
------------------ -------------- --------------
(unaudited) (unaudited) (unaudited)
Cash Flows from Operations:
Sales Income Received $ 2,357,528 $ 254,267 $ 70,593
Interest Received 188,897 0 0
Interest Paid (40,661) (9,742) (3,894)
Cash Paid for Operating
Expenses (7,407,965) (232,894) (240,267)
---------- --------- ---------
(4,902,201) 11,631 (173,568)
Cash Flows from Investing:
Property & Equipment Purchase (6,058,428) (14,021) 0
Deposits (5,000) 0 0
Collection of Notes Receivable 489,300 0 0
Sale of Equipment 10,500 0 0
---------- ---------- ----------
(5,563,628) (14,021) 0
Cash Flows from Financing Activities:
Proceeds from Sale of Common
Stock 6,381,845 25,710 295,475
Offering Cost (483,959) 0 0
Short Term Loan (52,450) 0 0
Financing Agreement 4,684,650 0 0
Purchase of Common Stock (20,000) 0 0
---------- ---------- ----------
10,510,086 25,710 295,475
Net Increase (Decrease) in Cash 44,257 23,320 121,907
Cash at Beginning of Period 0 20,937 6,045
---------- ---------- ----------
Cash at End of Period $44,257 $44,257 $127,952
========== ========== ==========
_______________________________________________________________________________
Reconciliation of Net Loss to Net Cash
Net (Loss) Gain ($9,165,582) ($61,211) ($225,111)
Adjustments to Reconcile Net Loss to
Cash Used:
Imputed Interest on Finance
Agreement 432,199 0 0
Depreciation 2,553,471 65,730 67,188
Foreign Exchange (Gain) Loss (434,719) 0 0
(Increase) Decrease in
Receivables (80,723) 18,401 (5,649)
Increase (Decrease) in Payables 183,483 (34,302) (31,351)
Equity in Net (Gain) Loss of
Affiliate 104,489 0 0
Value of Stock Issued for
Services & Interest 1,506,098 22,921 18,761
(Gain) Loss on Sale of
Equipment 2,877 0 0
(Increase) Decrease in
Inventory (3,794) 92 2,594
---------- ---------- ----------
Net Cash Used by Operating
Activities ($4,902,201) $11,631 ($173,568)
========== ========== ==========
<PAGE>
FOOD TECHNOLOGY SERVICE, INC.
(A Development Stage Company)
STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE THREE MONTH PERIOD ENDED MARCH 31,
Common Stock Paid-In Capital Deficit
------------ --------------- -------
1999 (unaudited)
----
Balance, January 1, 1999 $ 100,900 $10,982,963 ($8,216,342)
Sale of 153,400 Shares of Stock
for $295,475 1,534 293,941 0
Offering Cost to Sell Stock 0 0 0
Net Loss for Period 0 0 (225,111)
---------- ----------- -----------
Balance, March 31, 1999 $ 102,434 $11,276,904 ($8,441,453)
========== ========== ==========
___________________________________________________________________
2000(unaudited)
----
Balance, January 1, 2000 $ 103,162 $11,438,631 ($9,104,371)
Sale of 15,000 Shares of Stock
for $25,710 150 25,560 0
Net Loss for Period 0 0 (61,211)
---------- ---------- ----------
Balance, March 31, 2000 $ 103,312 $11,464,191 ($9,165,582)
========== ========== ==========
(a) Earnings per common share, assuming no dilution, are based on the
number of shares outstanding on March 31 of each year: 10,243,401 (1999)
and 10,331,201 (2000).
(b) The foregoing information is unaudited, but, in the opinion of
Management, includes all adjustments, consisting of normal accruals,
necessary for a fair presentation of the results for the period
reported.
<PAGE>
Management's Analysis of Quarterly Income Statements
Operations
- ----------
Results for the first quarter were up over the same period last year; sales
of $235,378 vs. $72,378, an increase of $163,488, or 225%. Losses for the
period were $61,211 compared to $222,777 for the first quarter last year and
decrease of $161,566.
It is managements belief that the manufacturers, processors, foodservice
operators and retailers will embrace the much needed food safety tool
irradiation offers. We have every reason to believe that during the second
quarter of this year you will see irradiated ground beef and poultry in the
market place. Consumer education remains a significant challenge that will
result in a successful launce of this category. The result of all major studies
supports that as consumer knowledge about irradiation increases, their desire
for the products increases.
Liquidity and Capital Resources
- -------------------------------
As of March 31, 2000, the Company has cash on hand of $44,258 and accounts
receivable of $80,723. The special alliance that the Company has with Nordion
should guarantee the Company's survival as a going entity until the food
irradiation industry develops based upon the recent government approvals.
OTHER INFORMATION
None applicable to this report and are, therefore, omitted.
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.
Date: April 30, 2000 FOOD TECHNOLOGY SERVICE, INC.
/S/ E. W. (Pete) Ellis
---------------------------------
E.W. (Pete) Ellis, President and
Chief Executive Officer
/S/ Dana S. Carpenter
----------------------------------
Dana S. Carpenter, Asst. Corporate Secretary
<PAGE>
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<ARTICLE> 5
<MULTIPLIER> 1
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<CASH> 44,257
<SECURITIES> 0
<RECEIVABLES> 98,898
<ALLOWANCES> 0
<INVENTORY> 3,794
<CURRENT-ASSETS> 146,949
<PP&E> 5,867,823
<DEPRECIATION> 2,547,898
<TOTAL-ASSETS> 6,191,426
<CURRENT-LIABILITIES> 264,211
<BONDS> 977,397
0
0
<COMMON> 103,312
<OTHER-SE> 2,298,609
<TOTAL-LIABILITY-AND-EQUITY> 3,643,529
<SALES> 235,866
<TOTAL-REVENUES> 235,866
<CGS> 0
<TOTAL-COSTS> 71,939
<OTHER-EXPENSES> 126,745
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 32,663
<INCOME-PRETAX> (61,211)
<INCOME-TAX> 0
<INCOME-CONTINUING> (61,211)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (61,211)
<EPS-BASIC> (.006)
<EPS-DILUTED> (.006)
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