AMBASSADOR FOOD SERVICE CORPORATION
P.O. BOX 419586
Kansas City, Missouri 64111
April 15, 1999
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
Pursuant to the requirements of the Securities Exchange Act of
1934, we are transmitting herewith the attached Form 10QSB.
Sincerely,
AMBASSADOR FOOD SERVICE CORP.
Richard A. Mitchell
Richard A. Mitchell, Vice President
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended February 25, 1999
Commission File Number 0-1744
Ambassador Food Services Corporation
Delaware 44-0656199
(State or other jurisdiction of (IRS Employer Identification #)
incorporation or organization)
Post Office Box 419586 3269 Roanoke Road
Kansas City, Missouri 64141-6586 Kansas City, Missouri 64111-3785
(Address of principal executive offices)
816-561-6474
(Registrant's Telephone Number, Including Area Code)
No changes
(Former Name, Former Address, and Former Fiscal Year, if Changed
Since Last Report)
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 twelve 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 ninety days.
YES NO X
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the close of the period covered by
this report:
Common Stock ($1.00 par value) 735,056 shares outstanding as of
02/25/99.
AMBASSADOR FOOD SERVICES CORPORATION
AND SUBSIDIARIES
I N D E X
Page
Number
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets
February 25, 1999 (Unaudited) and May 28, 1998 3
Consolidated Statements of Income
Nine months ended February 25, 1999
(Unaudited) and February 26, 1998 (Unaudited) 4
Condensed Consolidated Statements of Cash Flows
Nine months ended February 25, 1999 (Unaudited) 4
Notes to Condensed Consolidated
Financial Statements (Unaudited) 5
Item 2.Management's Discussion and Analysis of
Financial Condition and Results of Operations 5 - 6
Signatures 6
AMBASSADOR FOOD SERVICES CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
2/25/99 5/28/98
ASSETS
Cash $ 291,435 $ 271,709
Accounts & Notes Receivable 1,166,920 1,492,466
Inventories 596,826 483,999
Other Current 149,357 134,961
Total Current Assets 2,204,538 2,383,135
Property,Plant and Equip.-Net 1,736,740 1,810,984
Location Contracts 244,306 253,345
Other Long Term Assets 602,663 1,138,645
Total Assets 4,788,247 5,686,109
LIABILITIES AND STOCKHOLDERS' EQUITY
Trade Accounts Payable 1,908,478 1,955,896
Accrued Expenses and Other 324,859 678,243
Current Maturities of
Long-Term Debt 274,271 864,904
Line of Credit 274,756 721,929
Total Current Liabilities 2,782,364 4,220,922
Long-Term Debt 1,351,692 646,803
Other Long Term Liabilities 370,773 405,577
Stockholders' Equity:
Common Stock 1,009,230 1,009,230
Additional Paid-In Capital 718,291 718,291
Retained Earnings (1,116,648) (993,328)
610,873 734,139
Less: Treasury Stock 327,455 321,436
283,418 412,757
Total Liabilities &
Stockholders' Equity $ 4,788,247 $ 5,686,109
Note: The balance sheet at May 28, 1998 has been taken from the
audited financial statements at that date, and condensed. See
accompanying notes to consolidated condensed financial statements.
AMBASSADOR FOOD SERVICES CORPORATION
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
2/25/99
Net Cash provided (used)
by continuing operations (138,242)
Net Cash provided (used)
by investing activities 586,728
Net Cash provided (used)
by financing activities (332,917)
Net Incr (Decr) in Cash 19,726
Cash:
Beginning of period (June) 271,709
End of period (February) 291,435
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
39 Weeks 39 Weeks
Ended Ended
02/25/99 02/26/98
Total Revenues 13,174,003 14,687,148
Costs and Expenses:
Cost of Products Sold 5,591,388 6,026,744
Payroll Expense 3,612,341 3,907,319
Other Operating Expenses 1,632,995 1,893,587
Selling and Administrative 1,900,813 2,161,820
Depreciation and Amortization 350,077 389,938
Interest 224,030 289,821
Total Expenses 13,312,244 14,669,229
Income from Cont. Ops. (BIT) (138,242) 17,919
Provision for Income Taxes -0- -0-
Net (Loss) Earnings (138,242) 17,919
Earnings per Common Share (.19) .02
AMBASSADOR FOOD SERVICES CORPORATION
AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The condensed consolidated balance sheet as of February 25, 1999, the
consolidated statements of income for the nine month periods ended
February 25, 1999, and February 26, 1998, and the condensed consolidated
statements of cash flows for the nine month periods then ended have
been prepared by the company, without audit. In the opinion of
management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position, results
of operations, and cash flows at February 25, 1999 and for all periods
presented have been made.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these condensed consolidated financial statements be read in
conjunction with the financial statements and notes thereto included in
the Company's May 28, 1998 annual report to shareholders. The results
of operations for the periods ended February 25, 1999 and February 26, 1998
are not necessarily indicative of the operating results for the full year.
2. INVENTORIES
Inventories consist of raw materials and supplies.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION
Revenues for the nine months ended February 25, 1999 showed a decrease
of 10.3% compared to the same period for 1998. This decrease of $1,513,145
reflects lower sales levels in the Company's Kansas City and New York
Operations. Sales in the Kansas City operation are down $703,397 from those
recorded in the prior year. This is due to the loss of certain accounts to
competitors and the cancellation of unprofitable account locations. Sales
in the New York operation are lower by more than $520,000 compared to 1998.
1998 sales in New York reflected unusually high levels of activity due to
certain short term agreements which ended in May and June of 1998.
Management anticipates sales to continue near current levels in the short
term as management continues to eliminate unprofitable situations.
Cost of products sold and Payroll costs rose as a percentage of sales
compared to the prior year. This reflects the effects of the short term
agreements lost in the New York operation which carried very low costs
in these areas. Management has eliminated a number of operating positions
in the Iowa market and anticipates improvement in payroll costs on an
ongoing basis.
The Company's debt service obligations have been reduced through control
of capital expenditures, receipt of payments on notes receivable and debt
restructuring. This has allowed the Company to strengthen working capital
and provide available capital for unforeseen business needs.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, there-unto duly
authorized.
AMBASSADOR FOOD SERVICES CORPORATION
(Registrant)
By
Robert A. Laudicina Date
President
By
Richard A. Mitchell Date
Vice President/Secretary
[ARTICLE] 5
<TABLE>
<S> <C>
[PERIOD-TYPE] OTHER
[FISCAL-YEAR-END] MAY-28-1998
[PERIOD-END] FEB-25-1999
[CASH] 291,435
[SECURITIES] 0
[RECEIVABLES] 1,166,920
[ALLOWANCES] 0
[INVENTORY] 596,826
[CURRENT-ASSETS] 2,204,538
[PP&E] 7,436,410
[DEPRECIATION] 5,699,670
[TOTAL-ASSETS] 4,788,247
[CURRENT-LIABILITIES] 2,782,364
[BONDS] 0
[COMMON] 1,009,230
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[OTHER-SE] 0
[TOTAL-LIABILITY-AND-EQUITY] 4,788,247
[SALES] 13,174,003
[TOTAL-REVENUES] 13,174,003
[CGS] 5,591,388
[TOTAL-COSTS] 13,312,244
[OTHER-EXPENSES] 0
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 224,030
[INCOME-PRETAX] (138,242)
[INCOME-TAX] 0
[INCOME-CONTINUING] (138,242)
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] (135,242)
[EPS-BASIC] (.19)
[EPS-DILUTED] (.19)
</TABLE>
