THIS DOCUMENT IS A COPY OF THE FORM 10Q FILED ON JULY 18, 2000
PURSUANT TO A RULE 201 TEMPORARY HARDSHIP EXEMPTION.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended May 31, 2000
or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period from to
Commission File Number: 000-19320
Ag Services of America, Inc.
(Exact name of registrant as specified in its charter)
Iowa 42-1264455
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2302 West First Street, Cedar Falls, Iowa 50613
(Address of principal executive offices) (Zip Code)
(319) 277-0261
(Registrant's telephone number, including area code)
Not Applicable
(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 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
5,266,364 common shares were outstanding as of May 31, 2000.
<PAGE>
AG SERVICES OF AMERICA, INC.
INDEX
Page
PART I. FINANCIAL INFORMATION
Item 1. Financial statements:
Consolidated condensed balance sheets, May 31, 2000
(unaudited) and February 29, 2000 1
Unaudited consolidated condensed statements of income,
three months ended May 31, 2000 and 1999 2
Unaudited consolidated condensed statements of cash
flows, three months ended May 31, 2000 and 1999 3
Consolidated statement of stockholders' equity,
three months ended May 31, 2000 4
Notes to consolidated condensed financial statements
(unaudited) 5-7
Item 2. Management's discussion and analysis of
financial condition and results of operations 8-12
PART II. OTHER INFORMATION
Item 6. Exhibits and reports on form 8-K: 13
(a) Exhibits
(11) Statement re computation of earnings
per common share 14
<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AG SERVICES OF AMERICA, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Dollars in thousands)
<CAPTION>
May 31, February 29
ASSETS 20000 2000*
(Unaudited)
----------- -----------
<S> <C> <C>
CURRENT ASSETS
Cash $142 $45
Customer notes receivable, less allowance
for doubtful notes and reserve for
discounts May 31, 2000 $9,840;
February 29, 2000 $5,700 255,154 130,882
Inventory and other assets 3,898 4,863
Foreclosed assets held for sale 1,755 1,075
Prepaid income taxes - 922
Deferred income taxes, net 1,920 1,920
---------- ----------
Total current assets $262,869 $139,707
---------- ----------
LONG-TERM RECEIVABLES AND OTHER ASSETS
Customer notes receivable, less allowance
for doubtful notes May 31, 2000 $2,460;
February 29, 2000 $1,550; $26,984 $22,475
Loan origination fees, less accumulated
amortization May 31, 2000 $535;
February 29, 2000 $454; 567 647
Deferred income taxes, net 292 292
---------- ----------
$27,843 $23,414
---------- ----------
EQUIPMENT, less accumulated depreciation
May 31, 2000 $1,638; February 29, 2000
$1,546; $1,239 $1,207
---------- ----------
$291,951 $164,328
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable, including current maturities $185,096 $82,066
Outstanding checks in excess of
bank balances 11,106 9,834
Accounts payable 12,967 1,091
Accrued expenses 1,766 1,577
Income taxes payable 788 -
---------- ----------
Total current liabilities $211,723 $94,568
---------- ----------
LONG-TERM LIABILITIES
Notes payable, less current maturities $18,464 $11,324
---------- ----------
STOCKHOLDERS' EQUITY
Capital stock $23,087 $22,884
Retained earnings 38,677 35,552
---------- ----------
$61,764 $58,436
---------- ----------
$291,951 $164,328
========== ==========
<CAPTION>
*Condensed from Audited Financial Statements.
<FN>
See notes to Consolidated Condensed Financial Statements.
</TABLE>
-1-
<PAGE>
<TABLE>
AG SERVICES OF AMERICA, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF INCOME
Three Months Ended May 31, 2000 and 1999
(Dollars in Thousands, Except Per Share Amounts)
<CAPTION>
2000 1999
---------- ----------
<S> <C> <C>
Net revenues:
Farm inputs $149,750 $128,085
Financing income 6,052 4,792
---------- ----------
$155,802 $132,877
---------- ----------
Cost of revenues:
Farm inputs $142,123 $120,987
Financing expense 2,838 1,923
Provision for doubtful notes 2,761 2,485
---------- ----------
$147,722 $125,395
---------- ----------
Income from continuing operations
before operating expenses and
income taxes $8,080 $7,482
Operating expenses 3,110 2,541
---------- ----------
Income from continuing operations
before income taxes $4,970 $4,941
Federal and state income taxes 1,845 1,838
---------- ----------
Income from continuing operations $3,125 $3,103
Discontinued operations - (26)
---------- ----------
Net income $3,125 $3,077
========== ==========
Earnings per share: Basic
Income from continuing operations $0.59 $0.59
Discontinued operations - -
---------- ----------
Net income $0.59 $0.59
========== ==========
Earnings per share: Diluted
Income from continuing operations $0.57 $0.57
Discontinued operations - -
---------- ----------
Net income $0.57 $0.57
========== ==========
Weighted average shares
Basic 5,256 5,221
========== ==========
Diluted 5,531 5,439
========== ==========
<FN>
See Notes to Consolidated Condensed Financial Statements.
</TABLE>
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<PAGE>
<TABLE>
AG SERVICES OF AMERICA, INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
Three Months Ended May 31, 2000 and 1999
(Dollars in Thousands)
<CAPTION>
2000 1999
---------- ----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $3,125 $3,077
Adjustments to reconcile net income to
net cash (used in) operating activities:
Depreciation 92 110
Amortization 81 29
(Increase) in customer notes receivable (128,782) (123,023)
Changes in assets and liabilities 14,740 19,123
---------- ----------
Net cash (used in) operating activities ($110,744) ($100,684)
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of equipment ($124) ($253)
(Increase)decrease in foreclosed assets
held for sale (680) (2,736)
---------- ----------
Net cash (used in) investing activities ($804) ($2,989)
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable $128,479 $117,577
Principal payments on notes payable (18,309) (9,759)
Increase (decrease) in excess of outstanding
checks over bank balance 1,272 (4,173)
Proceeds from issuance of capital stock,
net 203 123
---------- ----------
Net cash provided by financing
activities $111,645 $103,768
---------- ----------
Increase in cash and cash equivalants $97 $95
CASH
Beginning 45 67
---------- ----------
Ending $142 $162
========== ==========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash payments for:
Interest $2,217 $1,562
Income taxes $135 $718
<FN>
See notes to Consolidated Condensed Financial Statements
</TABLE>
-3-
<PAGE>
<TABLE>
AG SERVICES OF AMERICA, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
Three Months Ended May 31, 2000
(Dollars in thousands)
<CAPTION>
Capital Stock
-----------------------
Shares Retained
Issued Amount Earnings Total
---------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Balance,
February 29, 2000 5,249,039 $22,884 $35,552 $58,436
Net income -- -- 3,125 3,125
Issuance of 16,825
shares of capital
stock upon the
exercise of
options 16,825 192 -- 192
Issuance of 500
shares of capital
stock under the
employee stock
purchase plan 500 11 -- 11
---------- ----------- ----------- -----------
Balance, May 31, 2000 5,266,364 $23,087 $38,677 $61,764
========== =========== =========== ===========
<FN>
See Notes to Consolidated Condensed Financial Statements
</TABLE>
-4-
<PAGE>
AG SERVICES OF AMERICA, INC.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1. Basis of Presentation
The accompanying unaudited condensed financial statements have
been prepared in accordance with the instructions of Form 10-Q and Rule 10-01 of
Regulation S-X. 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 these
interim consolidated condensed financial statements be read in conjunction
with the financial statements and notes thereto included in the Company's
Annual Report for the year ended February 29, 2000. In the opinion of
management, all adjustments (which include only normal recurring adjustments)
necessary for a fair presentation of the financial position, results of
operations and cash flows for the interim periods presented have been made.
Operating results for the three month period ended May 31, 2000 are not
necessarily indicative of the results that may be expected for the year ending
February 28, 2001.
Principles of Consolidation:
The consolidated financial statements include the accounts of Ag Services of
America, Inc. (the Company) and its wholly owned subsidiary, Ag Acceptance
Corporation. All material intercompany balances and transactions have been
eliminated in consolidation.
According to the terms related to the asset backed securitized financing
program as described in Note 3 of the consolidated condensed financial
statements, the Company formed Ag Acceptance Corporation, a wholly owned,
special purpose corporation.
Unless otherwise noted, all amounts present are in thousands except per share
amounts.
Note 2. Commitments and Contingencies
Commitments:
In the normal course of business, the Company makes various commitments that
are not reflected in the accompanying consolidated condensed financial
statements. These include various commitments to extend credit to
customers. At May 31, 2000 and February 29, 2000 the Company had
approximately $119,000 and $91,000, respectively, in commitments to supply
farm inputs. No material losses or liquidity demands are anticipated as a
result of these commitments.
Contingencies:
The Company is named in lawsuits in the ordinary course of business. Counsel
for the Company has advised the Company, while the outcome of various legal
proceedings is not certain, it is unlikely that these proceedings will result
in any recovery which will materially affect the financial position or
operating results of the Company.
-5-
<PAGE>
The availability of lines of credit to finance operations and the existence of
a multi-peril crop insurance program are essential to the Company's operations.
If the federal multi-peril crop insurance program currently in existence were
terminated or negatively modified and no comparable private or government
program were established, this could have a material adverse effect on the
Company's future operations. The government has from time to time evaluated
the federal multi-peril insurance program and is likely to review the program
in the future, and there can be no assurance about the outcome of such
evaluations.
Note 3. Pledged Assets and Related Debt
The Company entered into a five-year asset backed securitized financing
program through fiscal 2004, with a maximum available borrowing amount of $325
million. Under the terms of the five-year facility, the Company sells and
may continue to sell or contribute certain notes receivable to Ag Acceptance
Corporation ("Ag Acceptance"), wholly owned, special purpose subsidiary of the
Company. Ag Acceptance pledges its interest in these notes receivable to a
commercial-paper market conduit entity on $255 million of the facility which
incurs interest at variable rates in the commercial paper market and the
remaining $70 million is a three-year term note with interest at a variable
cost of LIBOR plus 25 basis points. The agreement contains various restrictive
covenants including, among others, restrictions on mergers, issuance of stock,
declaration or payment of dividends, transactions with affiliates, and requires
the Company to maintain certain levels of equity and pretax earnings. Advances
under the facility are made subject to portfolio performance, financial
covenant restrictions and borrowing base calculations. At May 31, 2000, the
Company had a maximum amount available under the asset backed securitized
financing program of approximately $0.2 million based on borrowing base
computations as provided by the agreement.
In conjunction with the securitized financing program, the Company currently
maintains an $8.5 million revolving bank line of credit through July 2000.
The line of credit is accessible to cover any potential deficiencies in
available funds financed through the securitization program. At May 31, 2000
the Company had a maximum amount available under the agreement of
approximately $1.0 million based on the borrowing base computation as provided
by the agreement.
During 1998, the Company negotiated an additional bank line of credit with
a maximum available borrowing amount of $12 million. The line of credit is
accessible to cover the Company's funding requirements for its intermediate
loan program and extends its terms through July 2000. At May 31, 2000,
the Company had approximately $0.9 million available under the
line of credit based on the borrowing base computation as provided by the
agreement.
Subsequent to end of the first quarter of fiscal 2001, the Company received
a commitment for a $30 million term loan. The term loan will be due in
equal annual installments beginning in July of 2002 through maturity in
July 2005. In conjunction with this $30 million five-year term note,
the Company will extend the terms and increase their $8.5 million revolving
bank line of credit to $15 million dollars. Also, the Company's will use
the proceeds from the $30 million term loan to pay off and terminate the
$12 million line of credit.
-6-
<PAGE>
Note 4. Earnings Per Share
Basic earnings per share is computed by dividing net income available to
common stockholders by the weighted average number of shares outstanding.
In computing diluted earnings per share, the dilutive effect of stock options
during the periods presented as well as the effect of contingently issuable
shares also increase the weighted average number of shares.
-7-
<PAGE>
AG SERVICES OF AMERICA, INC.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
The following table sets forth percentages of net revenues represented by the
selected items in the unaudited condensed statements of income of the Company
for the three months ended May 31, 2000 and 1999. In the opinion of
management, all normal and recurring adjustments necessary for a fair
statement of the results for such periods have been included. The operating
results for any period are not necessarily indicative of results for any
future period.
Percentage
of Net Revenues
------------------
Three Months Ended
May 31,
------------------
2000 1999
-------- --------
Net Revenues:
Farm inputs 96.1% 96.4%
Financing Income 3.9% 3.6%
-------- --------
Total Net Revenues 100.0% 100.0%
-------- --------
Cost of Revenues:
Farm inputs 91.2% 91.1%
Financing expense 1.8% 1.4%
Provision for doubtful notes 1.8% 1.9%
-------- --------
Total Cost of Revenues 94.8% 94.4%
-------- --------
Income from continuining operaions
before operating expenses and
income taxes 5.2% 5.6%
Operating expenses 2.0% 1.9%
-------- --------
Income from continuing operations
before income taxes 3.2% 3.7%
Federal and state income taxes 1.2% 1.4%
-------- --------
Income from continuing operations 2.0% 2.3%
Discontinued operations 0.0% 0.0%
-------- --------
Net income 2.0% 2.3%
======== ========
Net Revenues:
Net revenues increased $22.9 million or 17.3% during the three months ended
May 31, 2000, compared with the three months ended May 31, 1999. The Company
reached this record level through greater market penetration with the
increased name recognition gained by the Company's Agri-Flex Credit(R) program
in its 30 state market area. Financing income as a percentage of net income
-8-
<PAGE>
increased to 3.9% for the three months ended May 31, 2000 from 3.6%
the previous year. This increase was primarily a result of an increase in the
prime lending rate by 100 basis points, which is the base rate used by the
Company to charge interest on a variable rate basis to its customers, as
compared to a year ago.
Cost of Revenues:
The total cost of revenues increased to 94.8% of net revenues for the three
months ended May 31, 2000 as compared to 94.4% for the period ended May 31,
1999. The gross margin on the sale of farm inputs decreased to 4.9% for the
three months ended May 31, 2000 compared to 5.3% for the three months ended
May 31, 1999. The decrease in gross margin on the sale of farm inputs was
the result of sales mix shift into non-traditional crops such as sugar beets
and potatoes, which results in a shift to lower margin inputs. Concerning
the gross margin on financing income alone, the percentages decreased to
53.1% for the three months ended May 31, 2000 from 59.9% for the three months
ended May 31, 1999. The decrease in gross margin percentage from last year
is the result of continued increase in leverage and financing fees associated
with changes in the commercial paper program over the same fiscal quarter on
year ago. The provision for doubtful notes decreased slightly to 1.8% of net
revenues for the three months ended May 31, 2000 as compared to 1.9% for
May 31, 1999, as a result of improved portfolio performance of the Company.
Operating Expenses:
Operating expenses increased slightly to 2.0% from 1.9% of net revenues for
the three months ended May 31, 2000 and 1999, respectively. The increase in
operating expense is a result of infrastructure development of Powerfarm,
the Company's e-commerce initiative. Operating expenses as a percentage of
net revenues exclusive of Powerfarm declined to 1.8% of net revenues as a
result of increased economies of scale. The increase in the dollar amount of
operating expenses is attributed primarily to the Company's growth. Payroll
and payroll related expenses increased to $2,047 for the three months ended
May 31, 2000 from $1,845 for the three months ended May 31, 1999.
Discontinued Operations:
During fiscal 2000 the Company decided to discontinue the operations for the
three retail service centers in Northwestern Illinois. The Company began
leasing the three retail service centers in May of 1997 as a pilot program to
increase its customer base in Northwestern Illinois, as well as create
synergies to improve margins on the sale of fertilizer and agricultural
chemicals. Due to changes in market conditions at the retail level, the
Company was not successful in developing a profitable customer base in the
area. In addition, management's long-term strategies for continued growth and
profitability are focused on services, information and technology rather than
bricks and mortar. Net operating (loss) from discontinued operations were
none and ($26), for the periods ended May 31, 2000 and 1999, respectively.
Net Income:
Net income increased 1.6% to $3,125 for the three months ended May 31, 2000
from $3,077 for the three months ended May 31, 1999. The increase in net
income is attributable to the increase in net revenues and the corresponding
increase in gross profit. The percentage increase in net income was
less than the increase in net revenue due to the expenses associated with
infrastructure development of Powerfarm.com, the Company's e-commerce
initiative, and lower farm input margins as discussed above.
-9-
<PAGE>
Powerfarm:
Powerfarm.com has compiled the most comprehensive assortment of agriculture
products, services and credit options available on the Internet today.
Products currently available include seed, fertilizer and crop protection
chemicals, along with headline ag news, market quotes and weather.
Growers can shop at their convenience day or night for products and sign
up for additional services like crop insurance, grain marketing programs,
crop scouting and soil sampling services. Within the Powerfarm Community,
growers can post questions for the Company's agronomists and Certified Crop
Advisors. The Company continues discussions with additional suppliers
serving the $250 billion agriculture industry.
Powerfarm's impact on first quarter earnings resulted in a decline of
approximately $0.04 per share on diluted basis. Powerfarm's results
included revenues of approximately $400,000 and expenses related to
infrastructure and web site development and the ongoing operations
of Powerfarm of $354,000 resulting in a net loss of $221,000 for
Powerfarm operations in the first quarter of fiscal 2001. The Company
expects Powerfarm operations to operate at a loss during fiscal 2001.
Inflation:
The Company does not believe the Company's net revenues and income from
continuing operations were significantly impacted by inflation or changing
prices in fiscal 2000 or the first quarter of fiscal 2001.
Seasonality:
The Company's revenues and income are directly related to the growing cycle
for crops. Accordingly, quarterly revenues and income vary during each fiscal
year. The following table shows the Company's quarterly net revenues and net
income for fiscal 2000 and the first quarter of fiscal 2001. This information
is derived from unaudited consolidated financial statements which include, in
the opinion of management, all normal and recurring adjustments which
management consider necessary for a fair statement of results of those
periods. The operating results for any quarter are not necessarily indicative
of the results for any future period.
Fiscal 2001 Quarter Ended
May 31 August 31 November 30 February 28
----------- ----------- ----------- -----------
(Dollars in thousands)
Net revenues $155,802
Net income $3,125
Fiscal 2000 Quarter Ended
May 31 August 31 November 30 February 29
----------- ----------- ----------- -----------
(Dollars in thousands)
Net revenues $132,877 $88,703 $26,794 $46,210
Net income $3,077 $2,727 $1,615 $191
Liquidity and Capital Resources:
At May 31, 2000 the Company had working capital of $53,099 an increase of
$7,038 over a year ago and an increase of $7,960 since February 29, 2000.
-10-
<PAGE>
The components of this net increase, since February 29, 2000, were (i) $7,881
resulting from operating activities, consisting of approximately, $3,125 in
net income, $92 in depreciation, $81 in amortization, and the remainder from
a net change in other working capital items, (ii) capital expenditures of
approximately $124 related to the acquisition of equipment and furniture, and
(iii) net proceeds of $203 from the issuance of common stock upon exercise of
options and sales of stock through the employee stock purchase plan.
The Company entered into a five-year asset backed securitized financing
program through fiscal 2004 with a maximum available borrowing amount of $325
million. Under the terms of the five-year facility, the Company sells and
may continue to sell or contribute certain notes receivable to Ag Acceptance
Corporation ("Ag Acceptance"), wholly owned, special purpose subsidiary of the
Company. Ag Acceptance pledges its interest in these notes receivable to a
commercial paper market conduit entity on $255 million of the facility which
incurs interest at variable rates in the commercial paper market and the
remaining $70 million is a three-year term note with interest at a variable
cost of LIBOR plus 25 basis points. The agreement contains various
restrictive covenants, including, among others, restrictions on mergers,
issuance of stock, declaration or payment of dividends, transactions with
affiliates, and requires the Company to maintain certain levels of equity and
pretax earnings. Advances under the facility are made subject to portfolio
performance, financial covenant restrictions and borrowing base calculations.
At May 31, 2000, the Company had a maximum amount available under the asset
backed securitized financing program of approximately $0.2 million, based on
borrowing base computations as provided by the agreement.
In conjunction with the securitized financing program, the Company currently
maintains an $8.5 million bank line of credit through July 2000. The line of
credit is accessible to cover any potential deficiencies in available funds
financed through the securitization program. All borrowings are
collateralized by substantially all assets of the Company. The agreement
also requires that the total outstanding borrowings be repaid in full for 10
consecutive days during the Company's second fiscal quarter. The agreement
contains various restrictive covenants, including, among others, restrictions
on mergers, issuance of stock, declaration or payment of dividends, loans to
stockholders, and requires the Company to maintain certain levels of equity
and pretax earnings. At May 31, 2000, the Company had a maximum amount
available under the agreement of approximately $1.0 million based on the
borrowing base computation as provided by the agreement.
During 1998, the Company negotiated an additional bank line of credit with
a maximum available borrowing amount of $12 million. The line of credit is
accessible to cover the Company's funding requirements for its intermediate
loan program. All borrowings are collateralized by substantially all assets
of the Company. The agreement contains various restrictive covenants,
including, among others, restrictions on mergers, issuance of stock,
declaration or payment of dividends, loans to stockholders, and requires the
Company to maintain certain levels of equity and pretax earnings.
Advances under the line of credit agreement are also subject to portfolio
performance, financial covenant restrictions, and borrowing base calculations.
At May 31, 2000, approximately $0.9 million was available based on the
borrowing base computation as provided by the agreement.
Subsequent to end of the first quarter of fiscal 2001, the Company received
a commitment for a $30 million term loan. The term loan will be due in equal
annual installments beginning in July of 2002 through maturity in July 2005.
In conjunction with this $30 million five-year term note, the Company will
extend the terms and increase their $8.5 million revoloving bank line of credit
to $15 million dollars. Also, the Company's will use the proceeds from the
$30 million term loan to pay off and terminate the $12 million line of credit.
Management believes that the financial resources available to it, including
its bank lines of credit, asset backed securitization program, five-year term
-11-
<PAGE>
note, trade credit, its equity and internally generated funds, will be
sufficient to finance the Company and its operations in the foreseeable
future. The Company currently has no significant capital commitments.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995
Information contained in this report, other than historical information,
should be considered forward looking which reflect Management's current views
of future events and financial performance that invlove a number of risks and
uncertainties. The factors that could cause actual results to differ
materially include, but are not limited to, the following: general economic
conditions within the agriculture industry; competitive factors and pricing
pressures; changes in product mix; changes in the seasonality of demand
patterns; changes in weather conditions; changes in agricultural regulations;
technological problems; the amount and availability under its asset backed
securitization program; unkown risks; and other risks detailed in the
Company's Securities and Exchange Commission filings.
-12-
<PAGE>
AG SERVICES OF AMERICA, INC.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
(11) Statement re computation of earnings per common share is
attached.
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the period covered by
this report.
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.
AG SERVICES OF AMERICA, INC.
----------------------------
(Registrant)
/s/ Brad D. Schlotfeldt
----------------------------
Brad D. Schlotfeldt
Vice President of Finance & Treasurer
(Principal Financial & Accounting Officer)
Date: July 17, 2000
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<TABLE>
AG SERVICES OF AMERICA, INC.
EXHIBIT 11
STATEMENT RE: COMPUTATION OF EARNINGS PER SHARE
<CAPTION>
Three Months Ended
May 31
----------------------
2000 1999
---------- ----------
<S> <C> <C>
Computation of weighted average number
of basic shares:
Basic:
Common shares outstanding at
beginning of the period 5,249,039 5,212,604
Weighted average number of shares
issued during the period 6,583 8,426
---------- ----------
Weighted average shares outstanding
(basic) 5,255,622 5,221,030
========== ==========
Net income available to shareholders:
Income from continuing operations $3,125,303 $3,102,866
Discontinued operations - (26,312)
---------- ----------
Net income available to stockholders: $3,125,303 $3,076,554
========== ==========
Basic earnings per share:
Income from continuing operations $0.59 $0.59
Discontinued operations - -
---------- ----------
Basic earnings per share $0.59 $0.59
========== ==========
Diluted:
Common shares outstanding at
beginning of the period 5,249,039 5,212,604
Weighted average number of shares
issued during the period 6,583 8,426
Weighted average of potential dilutive
shares computed using the treasury
stock method using average market
price during the period:
Options (1) 275,205 218,045
---------- ----------
Weighted average shares outstanding
(diluted) 5,530,827 5,439,075
========== ==========
Net income
Income from continuing operations $3,125,303 $3,102,866
Discontinued operations - (26,312)
---------- ----------
Net income available to stockholders $3,125,303 $3,076,554
========== ==========
Diluted earnings per share
Income from continuing operations $0.57 $0.57
Discontinued operations - -
---------- ----------
Diluted earnings per share $0.57 $0.57
========== ==========
<CAPTION>
(1) Some of the stock options have been excluded because they are
antidilutive.
</TABLE>
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<PAGE>
