SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR
15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1998
------------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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--------------------------
Commission File Number 0-28238
GUARDIAN TECHNOLOGIES INTERNATIONAL, INC.
(Exact Name of Small Business Issuer as Specified in its Charter
DELAWARE 54-1521616
------------------- -----------------
(State or Other Jurisdiction of (I.R.S. Employer Identification
Incorporation or Organization) Number)
22570 Markey Court, Dulles, Virginia 20166
--------------------------------------------------------
(Address of Principal Executive Offices)
(703) 444-7931
--------------------------------------------------------
(Issuer's Telephone Number, Including Area Code)
--------------------------------------------------------
(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 Securities Exchange Act of 1934 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
--- ---
Number of shares of common stock, par value $.001 per share, outstanding at
November 13, 1998: 1,114,201
-----------
Transitional Small Business Disclosure Format (check one): YES NO X
--- ---
<PAGE>
GUARDIAN TECHNOLOGIES INTERNATIONAL, INC.
INDEX
Part I. Financial Information Page
Item 1. Financial Statements
Balance Sheets at September 30, 1998 and December 31, 1997 4
Statements of Income for Nine Month Periods Ended
September 30, 1998 and September 30, 1997 6
Statements of Cash Flows for Nine Month Periods Ended
September 30, 1998 and September 30, 1997 7
Notes to Financial Statements 8
Item 2. Management's Discussion and Analysis of Results of Operations 11
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K 14
Signature 15
Exhibit 11 - Statement re Computation of Per Share Earnings
Exhibit 27 - Financial Data Schedule
<PAGE>
PART I
FINANCIAL INFORMATION
Item 1. Financial Statements
GUARDIAN TECHNOLOGIES INTERNATIONAL, INC.
BALANCE SHEETS
September 30, 1998 and December 31, 1997
Unaudited
<TABLE>
<CAPTION>
September 30, December 31,
1998 1997
ASSETS ----------- -----------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents ....................... $ 461,310 $ 109,461
Accounts receivable ............................. 94,811 269,425
Notes receivable ................................ 500,000 --
Inventories ..................................... 213,825 452,335
Other current assets ............................ 56,384 59,088
----------- -----------
Total current assets ..................... 1,326,330 890,309
----------- -----------
PROPERTY AND EQUIPMENT
Land ............................................ 237,339 237,339
Building ........................................ 2,524,780 2,524,780
Manufacturing equipment ......................... 74,494 74,494
Office furniture and equipment .................. 125,192 118,763
Less accumulated depreciation ................... (233,441) (166,998)
----------- -----------
Total property and equipment ............. 2,728,364 2,788,378
----------- -----------
OTHER ASSETS ...................................... 149,239 51,185
----------- -----------
Total assets ............................ $ 4,203,933 $ 3,729,872
=========== ===========
See Notes to Financial Statements
</TABLE>
<PAGE>
GUARDIAN TECHNOLOGIES INTERNATIONAL, INC.
BALANCE SHEETS
September 30, 1998 and December 31, 1997
(continued)
Unaudited
<TABLE>
<CAPTION>
September 30, December 31,
1998 1997
----------- -----------
LIABILITIES AND STOCKHOLDERS'EQUITY
<S> <C> <C>
CURRENT LIABILITIES
Accounts payable ............................................................. $ 209,513 $ 337,615
Current portion of notes payable ............................................. 104,706 61,669
Other current liabilities .................................................... 19,633 124,652
----------- -----------
Total current liabilities ............................................. 333,852 523,936
LONG TERM PORTION OF NOTES PAYABLE ............................................. 1,834,844 927,148
----------- -----------
Total liabilities...................................................... 2,168,696 1,451,084
----------- -----------
STOCKHOLDERS' EQUITY
Preferred stock, $.20 par value, 1,000,000 shares
authorized; no shares issued and outstanding in 1998
and 1997 ................................................................... -- --
Common stock, par value $0.001, 15,000,000 shares
authorized; 1,114,201 shares issued and outstanding
in 1998 and 1997 ........................................................... 1,114 1,114
Additional paid-in capital ................................................... 4,143,924 4,107,424
Accumulated deficit since December 7, 1995, (termination of
S corporation status in which a deficit of $2,320,227 was
applied against additional paid-in capital) ................................ (2,109,801) (1,829,750)
----------- -----------
Total stockholders' equity ............................................ 2,035,237 2,278,788
----------- -----------
Total liabilities and stockholders' equity............................. $ 4,203,933 $ 3,729,872
=========== ===========
</TABLE>
See Notes to Financial Statements
<PAGE>
GUARDIAN TECHNOLOGIES INTERNATIONAL, INC.
STATEMENTS OF INCOME
For the Nine Months Ended September 30, 1998 and 1997
Unaudited
<TABLE>
<CAPTION>
Three Month Periods Nine Month Periods
Ended September 30, Ended September 30,
-------------------------- --------------------------
1998 1997 1998 1997
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net sales ....................................... $ 100,579 $ 293,651 $ 1,292,939 $ 749,464
Cost of goods sold .............................. 99,706 308,116 1,077,921 850,061
----------- ----------- ----------- -----------
Gross profit (loss) ............................. 873 (14,465) 215,018 (100,597)
Operating expenses:
Selling expenses .............................. 25,038 65,619 90,897 198,441
General and admin expenses .................... 92,649 113,886 407,547 464,127
----------- ----------- ----------- -----------
Total operating expenses ........................ 117,687 179,505 498,444 662,568
----------- ----------- ----------- -----------
Operating income (loss) ......................... (116,814) (193,970) (283,426) (763,165)
Other income (expense):
Net interest expense .......................... (16,087) (33,426) (74,520) (66,331)
Other income .................................. 40,458 25,628 131,818 72,647
Acquisition expense ........................... (53,923) -- (53,923) --
----------- ----------- ----------- -----------
Total other income (expense) .................... (29,552) (7,798) 3,375 6,316
----------- ----------- ----------- -----------
Income (loss) before income taxes ............... (146,366) (201,768) (280,051) (756,849)
Income taxes .................................... -- -- -- --
----------- ----------- ----------- -----------
Net income (loss) ............................... $ (146,366) $ (201,768) $ (280,051) $ (756,849)
=========== =========== =========== ===========
Primary income (loss) per common and common
equivalent shares ............................... $ (.13) $ (.18) $ (.25) $ (.68)
Fully diluted income (loss) per common and
common equivalent shares ........................ $ (.13) $ (.18) $ (.25) $ (.68)
Weighted Average
Shares Outstanding .............................. 1,114,201 1,114,201 1,114,201 1,114,201
No dividends were paid
See Notes to Financial Statements
</TABLE>
<PAGE>
GUARDIAN TECHNOLOGIES INTERNATIONAL, INC.
STATEMENTS OF CASH FLOWS
For the Nine months Ended September 30, 1998 and 1997
Unaudited
<TABLE>
<CAPTION>
September 30, September 30,
1998 1997
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss ............................................ $ (280,051) $ (756,849)
Adjustments to reconcile net loss to cash used
by operating activities:
Depreciation ...................................... 66,443 62,073
Amortization ...................................... 6,149 6,149
Compensation expense .............................. 36,500
Change in assets and liabilities:
(Increase) decrease in accounts receivable ...... 174,614 (58,377)
Decrease in interest receivable ................. -- 56,774
Decrease in inventories ......................... 238,510 202,267
(Increase) decrease in prepaid expenses
and deposits .................................. (100,199) 31,572
(Decrease) in accounts payable................... (85,065) (599,631)
(Decrease) in other liabilities ................. (105,019) 731
----------- -----------
Net cash used in operating activities ........... (48,118) (1,055,291)
----------- -----------
CASH FLOW FROM INVESTING ACTIVITIES
Purchase of property and equipment .................. (6,429) (258,203)
Acquisition of patent rights and certification ...... (1,300) (5,303)
Issuance of note receivable ......................... (500,000) --
Proceeds from redemption of marketable securities ... -- 2,491,017
Purchase of securities available for sale ........... -- (996,257)
----------- -----------
Net cash provided by/used in
investing activities ........................ (507,729) 1,231,254
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from short-term borrowings ................. -- 498,535
Principal payments on short-term borrowings ......... -- (1,595,496)
Proceeds from long-term borrowings .................. 1,900,000 900,000
Principal payments on long-term debt ................ (992,304) (45,795)
----------- -----------
Net cash provided by financing activities ...... 907,696 (242,756)
----------- -----------
Net increase (decrease) in cash and cash equivalents 351,849 (66,793)
Cash and cash equivalents at beginning of period ...... 109,461 114,006
----------- -----------
Cash and cash equivalents at end of period ............ $ 461,310 $ 47,213
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the period for:
Interest ....................................... $ 110,405 $ 156,014
=========== ===========
Income taxes ................................... $ -- $ --
=========== ===========
See Notes to Financial Statements
</TABLE>
<PAGE>
Notes to Financial Statements
Note 1 ORGANIZATION AND BUSINESS
Guardian Technologies International, Inc. (The Company) was reincorporated in
the State of Delaware in February, 1996, as part of a plan of Agreement and
Merger between Guardian Technologies International, Inc., a Virginia
corporation, and Guardian Technologies International, Inc., a Delaware
corporation. The Company manufactures and distributes soft armor products,
primarily superior quality ballistic protective vests, for law enforcement
officers, armed forces personnel, and other legitimate individuals or groups
requiring protective equipment.
Note 2 BASIS OF PRESENTATION
The accompanying financial statements have been prepared by the Company and are
unaudited. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted. In the opinion of the Company's
management, the disclosures are adequate to make the information presented not
misleading, and the financial statements contain all adjustments necessary to
present fairly in all material respects the financial position as of September
30, 1998 and December 31, 1997, results of operations for the nine months ended
September 30, 1998 and 1997 and cash flows for the nine months ended September
30, 1998 and 1997. The results of operations for the nine months ended September
30, 1998 are not necessarily indicative of the results to be expected for the
full year.
Note 3 REVERSE STOCK SPLIT
Effective on May 23, 1997 the Company's Common Stock and Class A Warrants were
split on a reverse basis 1 for 3. For each three shares of Common Stock
outstanding prior to the reverse split, one new share of Common stock was
issued. For each three Class A warrants outstanding prior to the reverse split,
one new Class A Warrant was issued. Each new Class A Warrant entitled the
registered holder thereof to purchase one new share of Common Stock until May
13, 1999 at a new exercise price of $15.00 per share.
Note 4 GENERAL SERVICES ADMINISTRATION (GSA) CONTRACT
The Company negotiated a new contract with the General Services Adminstration
(GSA), the purchasing agent for the U.S. Government. On June 1, 1997 the Company
began its listing on the new GSA Schedule which allows the Company to market its
product lines directly to new federal government and U.S. military customers
rather than through a third-party vendor. The Company recorded $258,612 in sales
through its contract with the GSA during the first nine months of 1998 compared
to $49,199 for the same period in 1997.
Note 5 INVENTORY
Inventory is comprised of the following as of:
9/30/98 12/31/97
--------- ---------
Raw materials 168,530 352,410
Work in progress -- 7,497
Finished goods 45,295 92,428
--------- ---------
213,825 452,335
========= =========
<PAGE>
Note 6 STOCK COMPENSATION
On January 28, 1998, at a special meeting of the Board of Directors, options to
purchase common stock were granted to officers and employees of the Company with
an exercise price of $2.50. Also at the meeting, common stock options were
granted to directors of the Company. All options granted expire January 28,
2000. Compensation expense for the directors' options granted using the Black
Scholes pricing model is approximately $36,500 with the following assumptions: a
risk-free interest rate of 5.63 percent, no estimated dividend yield, an
expected volatility of 36 percent and an expected holding period of two years.
The amount of compensation expense associated with the directors' options has
been reflected in the accompanying financial statements as an increase to
general and admin expenses and an increase to additional paid-in capital. No
compensation expense was recognized for the employee options granted, which are
valued using the intrinsic value method. However, for disclosure purposes,
compensation expense would be $36,500 for the employee stock options.
Note 7 FACILITIES LEASES
The Company has executed lease agreements with three tenants, effective February
1, 1997 and one tenant effective February 1, 1998 for approximately 18,800
square feet of office space (representing all available space) in the Company's
facility located in Dulles, Virginia. The leases are from five to seven years,
provide for monthly payments of base rent and operating expenses, and include a
2 to 3.5 percent increase in base rent annually. These leases provide estimated
annual rental income of $196,500 which is sufficient to service the related
mortgage on the facility (see Note 8).
Note 8 MORTGAGE NOTE PAYABLE
On March 25, 1998, the Company secured a mortgage on its office and
manufacturing facility located in Dulles, Virginia in the amount of $1,900,000.
The mortgage provides for monthly payments of principal and interest of $15,306,
including interest at a rate of 7.5 percent per annum. The mortgage is being
amortized over a twenty year period with a ten year balloon and is
collateralized by a first deed of trust on the facility as well as by an
assignment of all tenant occupancy leases. The purpose of the mortgage was to
payoff an outstanding note payable of $900,000 as of December 31, 1997 bearing
interest at a rate of 15 percent per annum as well as to provide approximately
$1,000,000 of excess funding available for working capital purposes.
Note 9 NOTE RECEIVABLE
On June 2, 1998, the Company issued a note receivable to a commercial entity in
the amount of $500,000. The note is for a twelve month period and provides for
monthly interest payments at a rate of 8.0 percent per annum plus minimum
additional principal payments of $50,000 per month beginning November 1, 1998.
The entire balance is due and payable no later than June 2, 1999.
Note 10 THE YEAR 2000 ISSUE
The Year 2000 Issue (Y2K) is the result of computer programs being written using
two digits rather than four to define the applicable year. Any the the Company's
computer programs that have date sensitive software may recognize a date using
"00" as the year 1900 rather than the year 2000. This could result in a system
failure or miscalculations causing disruptions of operations, including, among
other things, a temporary inability to process transactions, send invoices, or
engage in similar normal business activities. Based upon a recent assessment,
the Company has made a preliminary determination that it may be required to
upgrade or replace certain portions of its software so that its computer systems
will properly utilize dates beyond December 31, 1999. The Company presently
believes that, with upgrades of existing software and conversions to new
software at an estimated cost of , Y2K can be mitigated. However, the Y2K
solutions have not been implemented and are not scheduled to be completed until
1999. If such upgrades and conversions are not made, or are not completed or
available timely, the Year 2000 Issue could have a material impact on the
operations of the Company. Furthermore, the Company has yet to initiate formal
communications with its significant suppliers and large customers to determine
the extent to which the Company is vulnerable to those third parties' failure to
remediate their own Year 2000 Issue. As a result, there can be no guarantee that
the systems of other companies on which the Company's business relies will be
timely converted, or that a failure to convert by another company, or a
conversion that is incompatible with the Company's systems, would not have a
material adverse effect on the Company. In the view of the foregoing, there can
be no assurance that the Year 2000 Issue will not have a material adverse effect
upon the Company.
<PAGE>
Note 11 ACQUISITION EXPENSE
On September 30, 1998, the Company announced that a previous agreement to
acquire News/Sports Microwave Rental, Inc. (NS Microwave) headquartered in San
Diego, California was terminated by mutual agreement. The principal problem with
the agreement centered around accounting issues. It was initially believed that
the transaction would qualify for treatment as a Pooling of Interests. However,
it became apparent that the transaction would have to be treated as a Purchase
which would have resulted in the recognition of Goodwill in excess of $1 million
dollars. The Company felt that this was not in the best interest of its
shareholders. Costs of $53,923 associated with the proposed acquisition were
expensed by the Company during the quarter ended September 30, 1998.
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
OVERVIEW
The following is a discussion of the consolidated financial condition and
results of operations of the Company as of and for the two fiscal periods ended
September 30, 1998 and 1997. This discussion should be read in conjunction with
the Consolidated Financial Statements of the Company and the Notes related
thereto included in the Company's Form 10-KSB for the fiscal year ended December
31, 1997.
The forward-looking statements included in Management's Discussion and Analysis
of Financial Condition and Results of Operations, which reflect management's
best judgement based on factors currently known, involve risks and
uncertainties. Actual results could differ materially from those anticipated in
the forward-looking statements as a result of a number of factors, including but
not limited to those discussed herein.
RESULTS OF OPERATIONS
THREE MONTHS ENDED SEPTEMBER 30, 1998 COMPARED TO THREE MONTHS ENDED SEPTEMBER
30, 1997.
Net sales for the three months ended September 30, 1998 were $100,579 compared
to $293,651 for the same period in 1997, a decrease of $193,072 or 66%. The
decrease in sales was primarily attributable to two factors. First, the Company
secured an extension to a contract which provided for a $329,432 order during
the second quarter of 1998. The extension provides for a $275,000 order, but
will not be produced until the fourth quarter of 1998. Second, the recently
enacted Bulletproof Vest Partnership Grant Act of 1998 provides grants for the
purchase of body armor for law enforcement officers. The Company believes that
the normal level of armor orders has been pushed into future quarters as police
departments wait for the participation program to become fully operational.
The Company's gross profit for the three months ended September 30, 1998 was
$873 compared to a gross loss of ($14,465) for the same period in 1997. Gross
profit increased due to improved labor efficiencies and reductions in fixed
manufacturing costs.
Total operating expenses for the three months ended September 30, 1998 were
$117,687 compared to $179,505 for the same period in 1997. Selling expenses for
the three months ended September 30, 1998 were $25,038 compared to $65,619 for
the same period in 1997, a decrease of $40,581 or 62%. The decrease was
primarily attributable to decreases in sales consultant costs of $15,532, sales
salaries of $6,481 and sales commissions of $4,999. General and administrative
costs for the three months ended September 30, 1998 were $92,649 compared to
$113,886 for the same period in 1997, a decrease of $21,237 or 19%. The decrease
was primarily attributable to a decrease in legal and professional costs of
$5,460, a decrease in research and development costs of $11,802 and an overall
decrease in salaries for management personnel.
Other expense for the three months ended September 30, 1998 was ($29,552)
compared to other expense of ($7,798) for the same period in 1997. Net interest
expense for the three months ended September 30, 1998 was $16,087 compared to
$33,426 for the same period in 1997, a decrease of $17,339 or 52%. Other income
for the three months ended September 30, 1998 was $40,458 compared to $25,628
for the same period in 1997, an increase of $14,830 or 58%. The increase was
primarily attributable to an increase in rental income of $24,043 due to the
Company leasing out the remaining unoccupied space in its Dulles, Virginia
facility. As of February 1, 1998, all non-essential manufacturing and corporate
office space has been fully leased to four third party tenants for terms ranging
from five to seven years. Acquisition expense for the three months ended
September 30, 1998 was $53,923 compared to nil for the same period in 1997 (see
Note 11).
Net loss for the three month period ended September 30, 1998 was ($146,366) or
($.13) per share compared to a net loss of ($201,768) or ($.18) per share for
the same period in 1997.
<PAGE>
NINE MONTHS ENDED SEPTEMBER 30, 1998 COMPARED TO NINE MONTHS ENDED SEPTEMBER 30,
1997.
Net sales for the nine months ended September 30, 1998 were $1,292,939 compared
to $749,464 for the same period in 1997, an increase of $543,475 or 73%. The
increase in sales was primarily attributable to increased sales through the
Company's contract with the General Services Administration (GSA) of $258,612
for the nine months ended September 30, 1998 compared to nil for the same period
in 1997 and the completion of a $329,432 order during the second quarter of
1998.
The Company's gross profit for the nine months ended September 30, 1998 was
$215,018 compared to a gross loss of ($100,597) for the same period in 1997.
Gross profit increased due to higher production volume which resulted in
improved labor efficiencies coupled with reductions in fixed manufacturing
costs.
Total operating expenses for the nine months ended September 30, 1998 were
$498,444 compared to $662,568 for the same period in 1997. Selling expenses for
the nine months ended September 30, 1998 were $90,897 compared to $198,441 for
the same period in 1997, a decrease of $107,544 or 54%. The decrease was
primarily attributable to a decrease in sales consultant costs of $41,417 and a
decrease in advertising and promotion of $36,453. General and administrative
costs for the nine months ended September 30, 1998 were $407,547 compared to
$464,127 for the same period in 1997, a decrease of $56,850 or 12%. The decrease
was primarily attributable to a decrease in legal and professional costs of
$43,001 and an overall decrease in salaries for management personnel.
Other income for the nine months ended September 30, 1998 was $3,375 compared to
$6,316 for the same period in 1997. Net interest expense for the nine months
ended September 30, 1998 was $74,520 compared to $66,331 for the same period in
1997, an increase of $8,189 or 12%. The increase was primarily attributable to a
reduced amount of funds available to invest due to operating losses sustained
during 1997. Other income for the nine months ended September 30, 1998 was
$131,818 compared to $72,647 for the same period in 1997, an increase of $59,171
or 81%. The increase was primarily attributable to an increase in rental income
of $70,618 due to the Company leasing out the remaining unoccupied space in its
Dulles, Virginia facility. As of February 1, 1998, all non-essential
manufacturing and corporate office space has been fully leased to four third
party tenants for terms ranging from five to seven years. Acquisition expense
for the nine months ended September 30, 1998 was $53,923 compared to nil for the
same period in 1997 (see Note 11).
Net loss for the nine month period ended September 30, 1998 was ($280,051) or
($.25) per share compared to ($756,849) or ($.68) per share for the same period
in 1997.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 1998 the Company had total assets of $4,203,933 compared to
total assets of $3,729,872 as of December 31, 1997, an increase in assets of
$474,061. Total liabilities increased from $1,451,084 as of December 31, 1997 to
$2,168,696 as of September 30, 1998. Total stockholders' equity decreased
$243,551 to $2,035,237 as of September 30, 1998.
Total current assets as of September 30, 1998 were $1,326,330 and consisted of
cash and equivalents of $461,310, net accounts receivable of $94,811, a note
receivable of $500,000, inventory of $213,825 and other assets of $56,384. Total
current liabilities as of September 30, 1998 were $333,852 and consisted of
trade accounts payable of $209,513, the current portion of notes payable of
$104,706 and other liabilities of $19,633. Working capital as of September 30,
1998 was $992,478 representing an increase in working capital since December 31,
1997 of $626,105. Working capital increased during the nine months ended
September 30, 1998 primarily due to the the receipt of approximately $1,000,000
in excess funds from a mortgage placed on the Company's office and manufacturing
facility offset by operating losses sustained during the period of $280,051.
As of September 30, 1998 the Company reported total assets of $4,203,933
including net property and equipment of $2,728,364 (comprised primarily of costs
associated with the Company's acquisition of land and the subsequent
construction of executive offices and a manufacturing facility thereon) and
other assets of $149,239.
As of September 30, 1998 the Company reported total liabilities of $2,168,696
including, in addition to the current liabilities of $333,852 discussed above,
the long term portion of notes payable of $1,834,844. The long term portion of
notes payable is comprised of a mortgage received from a commercial entity
bearing interest at 7.5% per annum. Long term debt as of December 31, 1997 was
$927,148 comprised of $900,000 in long term debt received from a commercial
entity bearing interest at a rate of 15% per annum and $27,148 associated with
an insurance premium finance agreement.
As of September 30, 1998 the Company reported stockholders' equity of
$2,035,237. This represents a decrease of $243,551 from the December 31, 1997
stockholders' equity of $2,278,788. The decrease is attributable to the
Company's net loss during the period of $280,051 offset by $36,500 associated
with common stock options awarded to directors of the Company during the first
quarter of 1998. This amount is reflected as an increase to additional paid-in
capital.
<PAGE>
PART II
OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
Exhibit
Number Description
---------- ---------------
11 Statement re Computation of Per Share Earnings
27 Financial Data Schedule
(b) Reports on Form 8-K.
<PAGE>
SIGNATURE
In accordance with the requirements of the Exchange Act, the registrant
has duly caused this Report to be signed on its behalf by the undersigned,
thereunto duly authorized.
GUARDIAN TECHNOLOGIES INTERNATIONAL, INC.
-----------------------------------------
(Registrant)
Date: November 13, 1998 By: /s/Joseph F. Fernandez
--------------------------------------
Joseph F. Fernandez Vice
President, Chief Financial Officer, Chief
Accounting Officer and Treasurer
<PAGE>
GUARDIAN TECHNOLOGIES INTERNATIONAL, INC.
INDEX TO EXHIBITS
Exhibit
Number Description
- ---------- --------------
11 Statement re Computation of Per Share Earnings
27 Financial Data Schedule
<PAGE>
EXHIBIT 11
COMPUTATION OF EARNINGS PER SHARE
THREE MONTHS ENDED 9/30/98
<TABLE>
<S> <C>
Actual shares outstanding at 1/1/98 ..................................... 1,114,201
Common and common equivalent shares outstanding at 9/30/98 .............. 1,114,201
Weighted average shares outstanding for the nine months ended 9/30/98.... 1,114,201
</TABLE>
<TABLE>
<CAPTION>
Three months Nine months
ended ended
9/30/98 9/30/98
------------ ------------
<S> <C> <C>
Net Income (Loss) .......................................... $ (146,366) $ (280,051)
Net Income (Loss) per common and common equivalent shares .. $ (.1314) $ (.2513)
Rounded .................................................... $ (.13) $ (.25)
</TABLE>
<PAGE>
COMPUTATION OF EARNINGS PER SHARE
NINE MONTHS ENDED 9/30/97
<TABLE>
<S> <C>
Actual shares outstanding at 1/1/97 ..................................... 1,114,201
Common and common equivalent shares outstanding at 9/30/97 .............. 1,114,201
Weighted average shares outstanding for the nine months ended 9/30/97.... 1,114,201
</TABLE>
<TABLE>
<CAPTION>
Three months Nine months
ended ended
9/30/97 9/30/97
------------ ------------
<S> <C>
Net Income (Loss) ...................................... $ (201,768) $ (756,849)
Net Loss per common and common equivalent shares ....... $ (0.1811) $ (0.6793)
Rounded ................................................ $ (0.18) $ (0.68)
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 461,310
<SECURITIES> 0
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0
0
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</TABLE>
