<PAGE>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarter ended June 30, 1997
-------------------------------
[___] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from __________ to ___________
Commission File Number: 0-20528
--------------------------
Austin's International, Inc.
----------------------------
(Exact name of small business issuer as specified in its charter)
Delaware 65-0322000
-------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2400 E. Commercial Boulevard, Suite 800, Fort Lauderdale, Florida 33308
-----------------------------------------------------------------------
(Address of Principal Executive Office)
(305) 772-0980
--------------
(Issuer's Telephone Number)
Not Applicable
-----------------------------------------------------------------------
(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 Exchange Act 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
------- -------
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes No
------- -------
Not Applicable
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the Issuer's classes of
common equity, as of the latest practical date:
Common Stock $.01 Par Value - 10,003,550 shares as of June 30, 1997
--------------------------------------------------------------------
Transitional Small Business Disclosure Format (check one) Yes X No
--- ---
<PAGE>
Part I. FINANCIAL INFORMATION
- ------------------------------
ITEM 1. FINANCIAL STATEMENTS
The following unaudited financial statements and documents required by Item
310(b) of Regulation S-B are attached hereto as Exhibits "A - D":
Consolidated Balance Sheet - As of
June 30, 1997, and March 31, 1997 Exhibit "A"
Consolidated Statement of Changes
in Shareholders' Equity - For the
Period from March 31, 1997
through June 30,1997 Exhibit "B"
Consolidated Statement of Operations -
For the three months ended
June 30, 1997 and June 30, 1996 Exhibit "C"
Consolidated Statements of Cash Flows -
For the three months ended
June 30, 1997, and June 30, 1996 Exhibit "D"
Notes to Consolidated Financial Statements
2
<PAGE>
AUSTIN'S CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
EXHIBIT A
YEAR END
06/30/97 3/31/97
***************************************************************************
(UNAUDITED) (AUDITED)
ASSETS
<S> <C> <C>
CURRENT ASSETS:
CASH AND EQUIVALENTS $68,082 $171,724
ACCOUNTS RECEIVABLE $107,781 $111,023
INVENTORIES $127,131 $120,785
OTHER CURRENT ASSETS $127,134 $83,563
----------- -----------
TOTAL CURRENT ASSETS $430,128 $487,095
PROPERTY AND EQUIP
LEASEHOLD IMPROVEMENTS $1,251,411 $2,544,992
RESTAURANT & EQUIP $1,296,119 $1,009,254
OTHER EQUIPMENT $1,211,057 $133,642
----------- -----------
$3,758,587 $3,687,888
LESS ACCUM DEPR & AMORT ($1,421,150) ($1,332,756)
----------- -----------
$2,337,437 $2,355,132
SECURITY DEPOSITS & OTHER ASSETS $53,782 $71,394
----------- -----------
TOTAL ASSETS $2,821,347 $2,913,621
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
ACCOUNTS PAYABLE $395,433 $233,608
NOTES PAYABLE $1,218,000 $1,068,000
ACCRUED EXPENSES $87,695 $108,239
----------- -----------
TOTAL CURRENT LIABILITIES $1,701,128 $1,409,847
NOTES PAYABLE, LESS CURRENT PORTION
OTHER NON-CURRENT LIABILITIES $120,709 $122,209
----------- -----------
TOTAL LIABILITIES $1,821,837 $1,532,056
SHAREHOLDERS' EQUITY:
COMMON STOCK, $.01 PAR, 50,000,000 $100,035 $100,035
ADDITIONAL PAID-IN CAPITAL $8,471,553 $8,471,553
ACCUMULATED DEFICIT ($7,572,078) ($7,190,023)
----------- -----------
TOTAL SHAREHOLDERS' EQUITY $999,510 $1,381,565
----------- -----------
TOTAL LIABILITIES AND EQUITY $2,821,347 $2,913,621
</TABLE>
3
<PAGE>
AUSTIN'S CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
EXHIBIT B
<TABLE>
<CAPTION>
ADDITIONAL
PAID-IN ACCUMULATED SHAREHOLDERS'
SHARES PAR VALUE CAPITAL DEFICIT EQUITY
****************************************************************************************************************
<S> <C> <C> <C> <C> <C>
BALANCE MARCH 31, 1997 (AUDITED) 10,003,550 $100,035 $8,471,553 ($7,190,023) $1,381,565
CONVERSION OF DEBT TO COMMON STOCK $0 $0
NET LOSS ($382,055) ($382,055)
------------ ------------ ------------ ------------ ------------
BALANCE JUNE 30, 1997 (UNAUDITED) 10,003,550 $100,035 $8,471,553 ($7,572,078) $999,510
============ ============ ============ ============ ============
</TABLE>
4
<PAGE>
AUSTIN'S CONSOLIDATED STATEMENT OF OPERATIONS
EXHIBIT C
<TABLE>
<CAPTION>
3 MO ENDED 3 MO ENDED
06/30/97 06/30/96
***********************************************************************
(UNAUDITED) (UNAUDITED)
<S> <C> <C>
REVENUES:
NET SALES $972,979 $1,904,096
OTHER REVENUES $958 $10,706
INTEREST $4,120 $2,811
------------ ------------
TOTAL REVENUES $978,057 $1,917,613
COSTS AND EXPENSES:
FOOD AND BEVERAGE COSTS $357,504 $700,026
PAYROLL AND RELATED COSTS $392,517 $667,899
OTHER RESTAURANT OPERATING EXP $381,989 $543,353
GENERAL AND ADMIN EXPENSES $97,903 $154,868
DEPRECIATION AND AMORTIZATION $106,006 $102,783
INTEREST EXPENSE $24,193 $28,350
------------ ------------
TOTAL EXPENSES $1,360,112 $2,197,279
------------ ------------
NET LOSS ($382,055) ($279,666)
NET LOSS PER SHARE ($0.038) ($0.033)
WEIGHTED AVE SHARES OUTSTANDING 10,003,550 8,593,550
</TABLE>
5
<PAGE>
AUSTIN'S CONSOLIDATED STATEMENT OF CASH FLOW
<TABLE>
<CAPTION>
EXHIBIT D
3 MO ENDED 3 MO ENDED
06/30/97 06/30/96
********************************************************************************************
(UNAUDITED) (UNAUDITED)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (loss) ($382,055) ($279,666)
Adjustments to reconcile net income to net cash from operations:
Depreciation and amortization $106,006 $102,783
Changes in assets and liabilities:
Accounts receivable $3,242 $21,202
Inventories ($6,346) ($24,751)
Other current assets ($43,570) $10,356
Security deposits and other assets $0 ($4,301)
Pre-opening costs $0 ($106,393)
Accounts payable and accrued expenses $141,280 ($150,661)
Other non-current liabilities ($1,500) $463
--------- ---------
Net cash used by operating activities ($182,943) ($430,968)
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for property and equipment ($70,699) ($148,332)
--------- ---------
Net cash used by investing activities ($70,699) ($148,332)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of notes payable $150,000 $500,000
Repayment of long-term borrowings
Proceeds from sale of stock options & warrants $0 $0
--------- ---------
Net cash provided by financing activities $150,000 $500,000
--------- ---------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ($103,642) ($79,300)
CASH, CASH EQUIVALENTS, AND MKTBLE SECURITIES, BEGINNING OF PERIOD $171,724 $446,497
--------- ---------
CASH, CASH EQUIVALENTS, AND MKTBLE SECURITIES, AT END OF PERIOD $68,082 $367,197
========= =========
</TABLE>
6
<PAGE>
AUSTIN'S INTERNATIONAL, INC.
Notes to Financial Statements
-----------------------------
(Unaudited)
-----------
Note 1 - Financial Statements
- -----------------------------
In the opinion of the Company's management, the accompanying unaudited
consolidated financial statements contain all adjustments necessary to present
fairly the financial position as of June 30, 1997, and March 31, 1997, and the
results of operations and the cash flows for the period ending June 30, 1997 and
June 30, 1996.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. These statements should be read in conjunction
with the audited consolidated financial statements for the fiscal year ended
March 31, 1997, and notes thereto contained in the Company's 1997 Form 10-KSB
filed with the Securities and Exchange Commission on June 27, 1997. The results
of operations for the nine months ended June 30, 1997 are not necessarily
indicative of operating results to be expected for the full fiscal year.
Note 2 - Initial Public Offering
- --------------------------------
In July, 1992, the Company completed its initial public offering of common
stock. The offering consisted of the sale of 950,000 shares of the Company's
common stock and provided net proceeds to the Company of $4,125,939. The
Company utilized approximately $305,000 of the proceeds for the repayment of
debt and used the remainder for expansion and working capital.
Note 3 - Restaurant Operations
- ------------------------------
The Company currently operates three restaurants, one in Coral Springs,
Florida, one in Orlando, Florida, and one in Merritt Island, Florida, about five
miles from the Kennedy Space Center.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
The Issuer has developed, and owns and operates a chain of full service
restaurants specializing in Texas-style American cuisine. It currently offers a
wide variety of appetizers, salads and award-winning baby back ribs, as well as
a wide variety of steaks.
On July 18, 1997, the company's operating subsidiary, Austin's
International, Inc. A Florida corporation, filed for relief under chapter 11,
of the U.S. Bankruptcy code. (see 8-K, filed July 25, 1997).
NET SALES
Net sales for the three months ended June 30, 1997, were $972,979, as
compared to $1,904,096, for the three months ended June 30, 1996, or a 48.9%
decrease. The decline in sales is attributed to closing each restaurant for
lunch and discontinuing most promotions, discounts, and advertising.
FOOD AND BEVERAGE COSTS
Food and beverage costs for the three months ended June 30,1997, were
$357,504, or 36.7% of sales, as compared to $700,026, or 36.8% of sales, for the
period ending June 30, 1996.
PAYROLL AND RELATED COSTS
Payroll and related costs for the three months ended June 30, 1997, were
$392,517, or 40.3% of sales, as compared to $667,899 or 35.1% of sales, for the
period ending June 30, 1996. The operating increase is due to the fixed expense
ratios in a period of declining revenues.
8
<PAGE>
OTHER RESTAURANT OPERATING EXPENSES
Other restaurant operating expenses for the three months ended June 30,
1997, were $381,987, or 39.3% of sales, as compared to $543,353, or 28.5% of
sales, for the period ending June 30, 1996. This percentage increase is
attributable to the fixed overhead costs in this category during a period of
declining revenues.
GENERAL AND ADMINISTRATIVE EXPENSES
General and Administrative expenses for the three months ended June 30,
1997, were $97,903, or 10.1% of sales, as compared to $154,868, or 8.1% of
sales, for the period ending June 30, 1996.
NET PROFIT/LOSS
The Company's net loss per share for the three months ended June 30, 1997,
was 3.8 cents as compared to 3.3 cents per share for the three-months ended June
30, 1996.
9
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
a. Exhibits.
--------
23.1 Consent of independent accounts for Form S-8.
Incorporated by reference from Registrants
Form 10-KSB filed with the Commission on
June 27, 1997
*27 (1) Financial Data Schedule
*Filed as an exhibit to this report.
10
<PAGE>
b. Reports on Form 8-K.
-------------------
The Company filed an 8-K dated July 18, 1997, with the Commission on July,
25, 1997. The report covered the wholly owned subsidiary Austin's
International, Inc. A Florida Corporation, filing for relief under Chapter 11,
of the U.S. Bankruptcy Code.
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.
AUSTIN'S INTERNATIONAL, INC.
DATED: /s/ Larry E. Graybill
----------------------------
Larry E. Graybill, President
August 13, 1997
11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S UNAUDITED FINANCIAL STATEMENTS FOR THE FIRST QUARTER ENDED JUNE
30, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 68,082
<SECURITIES> 0
<RECEIVABLES> 107,781
<ALLOWANCES> 0
<INVENTORY> 127,131
<CURRENT-ASSETS> 443,652
<PP&E> 3,758,587
<DEPRECIATION> 1,421,150
<TOTAL-ASSETS> 2,821,347
<CURRENT-LIABILITIES> 833,128
<BONDS> 868,000
0
0
<COMMON> 100,035
<OTHER-SE> 899,476
<TOTAL-LIABILITY-AND-EQUITY> 2,821,347
<SALES> 972,979
<TOTAL-REVENUES> 978,057
<CGS> 357,504
<TOTAL-COSTS> 1,132,010
<OTHER-EXPENSES> 203,909
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 24,193
<INCOME-PRETAX> (382,055)
<INCOME-TAX> 0
<INCOME-CONTINUING> (382,055)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (382,055)
<EPS-PRIMARY> 0.04
<EPS-DILUTED> (0.04)<F1>
<FN>
<F1>SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS FOR FISCAL YEAR ENDED MARCH
31, 1997 - NOTE 3. - LOSS PER COMMON SHARE.
</FN>
</TABLE>
