<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended May 2, 1999
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from __________ to __________
Commission file number 33-42701
PREMIER CONCEPTS, INC.
----------------------
(Exact Name of Small Business Issuer as
Specified in its Charter)
Colorado 84-1186026
---------------------------- ---------------------
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification Number
3033 South Parker Road, Suite 120, Aurora, Colorado 80014
--------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(303) 338-1800
---------------
(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 Exchange Act during the last 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 [ ]
As of June 14, 1999, the Registrant had 1,064,128 shares of its $.002 par
value Common Stock outstanding.
Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]
<PAGE>
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INDEX
PART I. FINANCIAL INFORMATION Page
Item 1. Financial Statements 3
Balance Sheet as of May 2, 1999 and January 31, 1999 4
Statement of Operations and Comprehensive Income for the
Three Months Ended May 2, 1999 and April 26, 1998 5
Statement of Cash Flows for the Three Months Ended May 2, 1999
and April 26, 1998 6
Notes to Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial
Conditions and Results of Operations 9
Liquidity and Capital Resources 9
Results of Operations 12
PART II. OTHER INFORMATION 15
Item 1. Legal Proceedings 15
Item 2. Changes in Securities 15
Item 3. Defaults Upon Senior Securities 15
Item 4. Submission of Matters to a Vote of Security Holders 15
Item 5. Other Information 15
Item 6. Exhibits and Reports on Form 8-K 15
<PAGE>
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
-------------------
The method of financial reporting is a fifty-two - fifty-three (52-53)
week fiscal year ending on the last Sunday in January of each year. The
accompanying Balance Sheet at May 2, 1999, Statement of Operations and
Comprehensive Income for the Three Months Ended May 2, 1999 and April 26,
1998, and Statement of Cash Flows for the Three Months Ended May 2, 1999 and
April 26, 1998 are unaudited but reflect all adjustments which are, in the
opinion of management, necessary to a fair statement of the financial position
and results of operations for the interim period presented. The Balance Sheet
as of January 31, 1999 is derived from the audited financial statements, but
does not include all disclosures required by generally accepted accounting
principles. As a result, these financial statements should be read in
conjunction with the Company's Form 10-KSB for the year ended January 31,
1999.
FORWARD-LOOKING STATEMENTS
In addition to historical information, this Quarterly Report contains
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995, and are thus prospective. The forward-looking
statements contained herein are subject to certain risks and uncertainties
that could cause actual results to differ materially from those reflected in
the forward-looking statements. Factors that might cause such a difference
include, but are not limited to, competitive pressures, changing economic
conditions, those discussed in the Section entitled "Management's Discussion
and Analysis of Financial Condition and Results of Operations," and other
factors, some of which will be outside the control of the Company. Readers
are cautioned not to place undue reliance on these forward-looking statements,
which reflect management's analysis only as of the date hereof. The Company
undertakes no obligation to publicly revise these forward-looking statements
to reflect events or circumstances that arise after the date hereof. Readers
should refer to and carefully review the information in future documents the
Company files with the Securities and Exchange Commission.
<PAGE>
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PREMIER CONCEPTS, INC.
BALANCE SHEET
AS OF MAY 2, 1999 AND JANUARY 31, 1999
(May 2, 1999 UNAUDITED)
<TABLE>
<CAPTION>
May 2, January 31,
1999 1999
------------ -----------
<S> <C> <C>
ASSETS
Current Assets:
Cash & Cash Equivalents $ 273,720 $ 221,273
Merchandise Inventories 1,832,073 1,975,595
Prepaid Expenses & Other Current Assets 129,396 97,295
------------ -----------
Total Current Assets 2,235,189 2,294,163
Property and Equipment, net 2,588,329 2,699,376
Trademarks, net 59,933 63,033
Other Assets 71,133 80,132
------------ -----------
Total Assets $ 4,954,584 $5,136,704
============ ===========
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities:
Notes Payable and Current Portion of
Long Term Debt $ 172,520 $ 683,110
Accounts Payable 847,464 965,189
Accrued Liabilities 659,930 584,461
------------ -----------
Total Current Liabilities 1,679,914 2,232,760
Long-Term Debt, Less Current Portion 428,623 49,032
Other Liabilities 220,023 201,244
------------ -----------
Total Liabilities 2,328,560 2,483,036
------------ -----------
Shareholders' Equity:
Preferred Stock, $.10 par value, 20,000,000
shares authorized; none issued and
outstanding at May 2, 1999 and
January 31, 1999 - -
Common Stock, $.002 par value; 850,000,000
shares authorized; 1,164,128 shares
issued and outstanding at May 2, 1999,
and 887,513 shares issued and
outstanding at January 31, 1999 2,128 1,775
Additional Paid-in Capital 5,871,454 5,660,263
Accumulated Deficit (3,247,558) (3,008,370)
------------ -----------
Total Stockholders' Equity 2,626,024 2,653,668
------------ -----------
Total Liabilities & Equity $ 4,954,584 $5,136,704
============ ===========
</TABLE>
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<PAGE>
PREMIER CONCEPTS, INC.
STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME
FOR THE PERIOD ENDED MAY 2, 1999 AND APRIL 26, 1998
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended
May 2, 1999 April 26, 1998
------------- --------------
<S> <C> <C>
Revenues:
Retail Sales $ 2,808,967 $ 2,912,619
Wholesale Sales 6,131 1,670
------------ ------------
Total Revenues 2,815,098 2,914,289
Cost of Goods Sold 865,035 936,970
------------ ------------
Gross Margin 1,950,063 1,977,319
Operating Expenses:
Personnel 931,500 1,017,604
Occupancy 716,324 725,069
Other Selling, General and
Administrative 411,282 441,082
Depreciation and Amortization 124,138 123,499
------------ ------------
Total Operating Expenses 2,183,244 2,307,254
Operating Profit (Loss) (233,181) (329,935)
Other Income (Expenses):
Interest, net (10,716) (9,844)
Other 4,709 8,201
------------ ------------
Other, net (6,007) (1,643)
------------ ------------
Net Profit (Loss) and Comprehensive
Profit (Loss) $ (239,188) $ (331,578)
============ ============
Net Profit (Loss) Available to Common
Shareholders $ (239,188) $ (331,578)
============ ============
Net Profit (Loss) Per Common Share
(Basic and Diluted): $ (0.24) $ (0.37)
============ ============
Weighted Average Shares Outstanding 990,377 887,513
============ ============
</TABLE>
<PAGE>
<PAGE>
PREMIER CONCEPTS, INC.
STATEMENT OF CASH FLOWS
FOR THE PERIODS ENDED MAY 2, 1999 AND APRIL 26, 1998
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended
May 2, 1999 April 26, 1998
------------- -------------
<S> <C> <C>
Cash Flows From Operating Activities:
Net Profit (Loss) $ (239,188) $ (331,578)
Adjustments to reconcile net profit
(loss) to net cash from operating
activities:
Depreciation and amortization 124,138 123,499
Changes in operating assets and
liabilities:
(Increase) decrease in:
Merchandise inventories 143,522 279,036
Other assets (23,102) 90,603
Increase (decrease) in:
Accounts payable and accrued
liabilities (42,256) 7,294
Other liabilities 18,779 16,891
------------ ------------
Net cash provided (used) by operating
activities (18,107) 185,745
Cash Flows From Investing Activities:
Capital expenditures for property and
equipment (9,991) (505,490)
Cash Flows From Financing Activities:
Deferred Offering Costs (9,225) -
Proceeds from issuance of common stock 220,769 -
Payments on notes payable (130,999) (81,548)
------------ ------------
Net cash provided (used) by financing
activities 80,545 (81,548)
------------ ------------
Increase (Decrease) in Cash 52,447 (401,293)
Cash & Cash Equivalents, beginning of
period 221,273 806,049
Cash & Cash Equivalents, end of period $ 273,720 $ 404,756
============ ============
Supplemental Schedule of Cash Flow
Information:
Cash paid for interest $ 14,081 $ 21,873
============ ============
</TABLE>
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<PAGE>
PREMIER CONCEPTS, INC.
NOTES TO FINANCIAL STATEMENTS
May 2, 1999
Commitments and Contingencies
- -----------------------------
LITIGATION. The Company is subject to legal proceedings, claims and
liabilities, which arise in the ordinary course of its business. In the
opinion of management, the disposition of these actions will not have a
material adverse effect upon the Company's financial position or results of
operations. (See PART II. OTHER INFORMATION--Item 1. Legal Proceedings.)
Seasonality and Quarterly Fluctuations
- --------------------------------------
The Company's faux jewelry chain, operating under the trade names
Impostors and Elegant Pretenders, historically has realized lower sales during
the first three quarters which has resulted in the Company incurring losses
during those quarters. To this end, the Company generated an operating loss
during the three months ended May 2, 1999, of $233,181, as compared to an
operating loss of $329,935 for the three months ended April 26, 1998.
The Company's business is highly seasonal with its mall locations
generating approximately 20% of revenues during the December holiday season.
The Company's 12 tourist locations experience fluctuations, based upon such
factors as seasonality, economic conditions and other factors affecting
tourism in their particular locations.
Common Shares
- -------------
In January 1999, the Company's stockholders approved a 1 for 2 reverse
stock split at a future date at the discretion of the Company. In April 1999,
the Company's Board of Directors approved the reverse split immediately.
Accordingly, all common stock reflected in the accompanying financial
statements and in Management's discussion and analysis reflect this reverse
split for all periods presented.
Proforma Financial Information
- ------------------------------
On June 16, 1999, the Company's shareholders ratified and approved the
sale of 223,385 shares of the Company's Series A Preferred Stock for $279,231.
Each share of Series A Preferred Stock is convertible to one share of the
Company's common stock. The following Proforma Balance Sheet sets forth the
Company's Balance Sheet of May 2, 1999 giving retroactive effect to the equity
financing.
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<PAGE>
PREMIER CONCEPTS, INC.
PROFORMA BALANCE SHEET
FOR THE PERIOD ENDED MAY 2, 1999
<TABLE>
<CAPTION>
Proforma at
May 2, 1999 Proforma May 2, 1999
(Unaudited) Adjustments (Unaudited)
----------- ----------- -----------
<S> <C> <C> <C>
ASSETS
Current Assets:
Cash & Cash Equivalents $ 273,720 $ 279,231 $ 552,951
Merchandise Inventories 1,832,073 1,832,073
Prepaid Expenses & Other Current
Assets 129,396 129,396
----------- -----------
Total Current Assets 2,235,189 2,514,420
Property and Equipment, net 2,588,329 2,588,329
Trademarks, net 59,933 59,933
Other Assets 71,133 71,133
----------- -----------
Total Assets $4,954,584 $5,233,815
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities:
Notes Payable and Current Portion
of Long Term Debt $ 172,520 $ 172,520
Accounts Payable 847,464 847,464
Accrued Liabilities 659,930 659,930
----------- -----------
Total Current Liabilities 1,679,914 1,679,914
Long-Term Debt, Less Current
Portion 428,623 428,623
Other Liabilities 220,023 220,023
----------- -----------
Total Liabilities 2,328,560 2,328,560
----------- -----------
Shareholders' Equity:
Series A Preferred Stock, $1.25
stated value, 250,000 shares
authorized; none issued and
outstanding at May 2, 1999,
223,385 shares issued and
outstanding - proforma 0 279,231 279,231
Common Stock, $.002 par value;
850,000,000 Shares authorized;
1,164,128 shares issued
and outstanding at May 2, 1999 2,128 2,128
Additional Paid-in Capital 5,871,454 5,871,454
Accumulated Deficit (3,247,558) (3,247,558)
----------- -----------
Total Stockholders' Equity 2,626,024 2,905,255
----------- -----------
Total Liabilities & Equity $4,954,584 $5,233,815
=========== ===========
</TABLE>
<PAGE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with
the Financial Statements and Notes thereto appearing elsewhere in this report.
Retail Fiscal Year
- ------------------
The method of financial reporting is a fifty-two to fifty-three (52-53)
week fiscal year ending on the last Sunday in January of each year. Likewise,
reporting quarters end on the Sunday closest to the calendar end of April,
July and October. Each reporting quarter contains 13 weeks of operations.
Liquidity and Capital Resources - May 2, 1999 Compared to January 31, 1999
- --------------------------------------------------------------------------
At May 2, 1999 the cash balance of $273,720 was approximately 23% greater
than the cash balance of $221,273 at January 31, 1999.
On March 11, 1999 approximately $221,000 of equity capital was received
from the sale of 176,615 shares of common stock. These funds were used for
the development of our e-commerce business, and for the reduction of the
principal balance of the Bank Note as discussed below. A commitment for an
additional funding of approximately $279,000 has been obtained from the same
investment group. This additional funding was dependent upon shareholder
approval, which was obtained in a meeting of the shareholders on June 16,
1999. The proceeds from the second funding will provide funds for possible
retail expansion, and for general working capital.
During the quarter ended May 2, 1999, the Company initiated negotiations
to renew a note payable (Bank Note) with a Colorado financial institution.
The Bank Note had a maturity date of May 28, 1999. On April 1, 1999, the
principal reduction of $112,000, which was due December 30, 1998, was paid to
the Bank, and on May 28, 1999, the Bank Note was renewed. The renewed note
bears interest at the Bank's prime lending rate plus 1.5%, and requires
monthly payments of $1,000 plus accrued interest, beginning in June, 1999 and
continuing until the maturity date of June 20, 2000. A one time principal
payment of $37,000 is due on December 20, 1999. All fees and financial
covenants have been waived until maturity on June 20, 2000. The Bank Note
principal balance of $448,000, less the current portion of $47,000, is
classified as long-term debt at May 2, 1999.
On January 31, 1999, $122,000 of accounts payable relating to the spring
1998 construction of the store at Palisades Center in West Nyack, New York was
converted to a long-term note. The note requires monthly installments of
$5,000 including principal and interest at 10%, with a single payment of
$35,000 due January 1, 2000. Of the total principal balance of $109,950 at
May 2, 1999, approximately $27,600 is classified as long-term debt.
During the three months ended May 2, 1999, merchandise inventories
decreased $143,522, or approximately 7% from $1,975,595 at January 31, 1999 to
$1,832,073 at May 2, 1999. This decrease reflects our first quarter efforts
to reduce merchandise levels remaining after the holiday shopping season, and
our ongoing efforts to increase our inventory turn ratio.
Prepaid expenses and other current assets increased $32,101 from $97,295
at January 31, 1999 to $129,396 at May 2, 1999. The increase is primarily the
result of $20,000 paid with respect to a Management Services Agreement
associated with the equity funding noted above. The agreement provides for
certain consulting services including arrangement of the first and second
equity fundings as discussed above, and to provide strategic, operational and
investment banking advice. The total amount of the consulting agreement will
reach $50,000 upon completion of the second funding as discussed above. The
cost of the agreement is being amortized over one year.
As a result of the foregoing, current assets decreased by $58,974, from
$2,294,163 at January 31, 1999, to $2,235,189 at May 2, 1999.
During the three months ended May 2, 1999 approximately $10,000 was
invested in minor equipment and fixture improvements at the Company's
corporate offices in Aurora, Colorado. This compares to the $505,490 invested
in property and equipment for the three months ended April 26, 1998. These
investments consisted of leasehold improvements in connection with the
remodeling of the stores in Palm Desert, California, and in Menlo Park, New
Jersey, as well as three new locations at the Riverwalk in New Orleans,
Louisiana, Franklin Mills in Philadelphia, Pennsylvania, and Palisades Center
in West Nyack, New York.
Based on the foregoing, property and equipment, net of accumulated
depreciation, decreased $111,047, from $2,699,376 at January 31, 1999, to
$2,588,329 at May 2, 1999.
The Company's trademark assets, representing the goodwill of the
Impostors trademark and other intellectual property, was acquired as part of
the Company's acquisition of Impostors in 1994. This asset is being amortized
over a 10-year period, and had an amortized book value of $59,933 at May 2,
1999.
As of May 2, 1999, the Company had total outstanding liabilities of
$2,328,560 compared to $2,483,036 at January 31, 1999, a decrease of $154,476.
Current liabilities decreased $552,846, from $2,232,760 at January 31, 1999 to
$1,679,914 at May 2, 1999, primarily reflecting the $112,000 principal
reduction of the Bank Note as discussed above and the reclassification of the
Bank Note as long-term debt reflecting the June 20, 2000 maturity date.
In addition to the Bank Note and the store construction note payable,
both as discussed above, the current portion of long-term includes notes that
were part of the Impostors retail chain acquisition in February 1994. The
total debt related to these notes was reduced by $6,950 as the result of
normal scheduled payments from $50,142 at January 31, 1999, to $43,192 at May
2, 1999.
Accounts payable decreased by $117,725 or approximately 12%, from
$965,189 at January 31, 1999 to $847,464 at May 2, 1999. Other accrued
liabilities increased by $75,469 from $584,461 at January 31, 1999 to $659,930
at May 2, 1999, or approximately 13%. Accounts payable and accrued liabilities
represent expenses incurred in the ordinary course of business in connection
with the operation of the Impostors retail chain.
Working capital increased by $493,872, from $61,403 at January 31, 1999,
to $555,275 at May 2, 1999, primarily as the result of the equity funding as
discussed above, the decrease in merchandise inventories of $143,522, and the
reclassification of the Bank Note.
Other liabilities increased $18,779 from $201,244 at January 31, 1999, to
$220,023 at May 2, 1999, resulting from the recognition of rental expense on a
straight line basis on leases that contain predetermined fixed escalations of
the minimum rents during the initial term of the lease.
The increase in common stock of $353 from $1,775 at January 31, 1999 to
$2,128 at May 2, 1999, and the increase in additional paid-in capital of
$211,191 from $5,660,263 to $5,871,454 at January 31, 1999 and May 2, 1999,
respectively, reflects the proceeds received from the equity funding as
discussed above, net of direct costs of the offering of $9,991.
As a result of the net loss for the three months ended May 2, 1999 of
$239,188, the accumulated deficit increased from $3,008,370 at January 31,
1999 to a deficit of $3,247,558 at May 2, 1999. As a result, total
stockholders' equity decreased from $2,653,668 at January 31, 1999, to
$2,626,024 at May 2, 1999.
Net cash used by operating activities for the three months ended May 2,
1999 was $18,107, compared with cash provided by operating activities of
$185,745 for the three months ended April 26, 1998, which primarily reflects
the effect of the reduction of merchandise inventories and the decrease in
accounts payable and accrued liabilities as discussed above.
Cash used in investing activities of $9,991, primarily represents minor
equipment and fixture improvements at the corporate offices in Aurora,
Colorado. This compares with net cash used by investing activities of
$505,490 during the three months ended April 26, 1998 which primarily
represents investments in new retail stores and remodeling efforts as
discussed above.
Net cash provided by financing activities for the three months ended May
2, 1999, was $80,545, and represents the net proceeds of the equity funding,
and payments on notes payable, both as discussed above. This compares to net
cash used by financing activities of $81,548 for the three months ended April
26, 1998, representing payments on notes payable.
The foregoing resulted in an increase in the cash position of $52,447,
from $221,273 at January 31, 1999 to $273,720 at May 2, 1999.
The Company has not executed leases to open additional locations.
However, possible new locations are currently being evaluated. Depending on
location and size, the opening of a new retail location represents an
aggregate capital requirement of approximately $75,000-$150,000, including the
lease build-outs, fixtures, equipment and inventory. As discussed above, the
funding received in March, 1999 provided new capital to meet current
obligations, and the additional funding expected to be completed by June 30,
1999 will provide additional capital to further the Company's business plan.
Additional sources of capital are currently being evaluated to meet plans for
future capital investment and working capital needs. However there can be no
assurance that such financing will be secured.
Results of Operations - Three Months Ended May 2, 1999 Compared to Three
Months Ended April 26, 1998
- ------------------------------------------------------------------------
Set forth below is selected summary financial data derived from the
financial statements and financial records.
<TABLE>
<CAPTION>
Three Months Three Months
Ended Ended
May 2, 1999 April 26, 1998
----------- -------------
<S> <C> <C>
Statements of Operations Data:
Total Revenues $2,815,098 $ 2,914,289
Operating income (loss) (233,181) (329,935)
Net income (loss) (239,188) (331,578)
Net income (loss) available to
common shareholders (239,188) (331,578)
Net income (loss) per common share (.24) (.37)
Weighted average shares outstanding 990,377 887,513
Statistical Data:
Store revenues $2,803,997 $ 2,912,619
Store gross margin 1,948,354 1,980,856
Store operating expenses 1,761,262 1,905,171
Store operating profit 187,092 75,685
Corporate overhead operating expenses 421,444 391,518
Gross margin percentage 69.3% 67.9%
Comparable same store sales
(33 stores) 2,554,364 2,689,125
Comparable same store sales growth -5.0% N/A
</TABLE>
Total revenues for the three months ended May 2, 1999 were $2,815.098 as
compared to $2,914,289 for the comparable period ended April 26, 1998, a
decrease of $99,191, or 3.4%. Comparable same store sales were $2,554,364 for
the three months ended May 2, 1999 as compared to $2,689,125 for the
comparable period ended April 26, 1998, a decrease of approximately $135,000,
or 5%. The majority of the decrease was attributable to less promotional
activity during the quarter ending May 2, 1999, to enhance the gross margin.
Sales from wholesale and non-store retail operations, including direct
catalog and Internet sales of $11,100 and $1,670 are included in total
revenues for the three months ended May 2, 1999 and April 26, 1998,
respectively.
For the three months ended May 2, 1999, cost of goods sold was $865,035
and the gross margin was $1,950,063, or 69.3%. For the three months ended
April 26, 1998, cost of goods sold was $936,970 and the gross margin was
$1,977,319, or 67.8%. The 1.5% improvement in gross margin is attributed to a
more focused merchandise mix, and less promotional activity during the three
months ended May 2, 1999 as compared to the same period during 1998.
Total operating expenses were $2,183,244 for the three months ended May
2, 1999, compared to $2,307,254 for the period ended April 26, 1998, or 77.6%
and 79.2% of revenues, respectively, and representing a decrease of
approximately $124,000 for the comparable period. The majority of these
expenses were comprised of personnel expenses, which amounted to $931,500 and
$1,017,604 for the three months ended May 2, 1999, and April 26, 1998,
respectively, a decrease of approximately $86,000. Occupancy costs of
$716,324, and $725,069, and general administrative costs of $411,282 and
$441,082 are included in total operating expenses for the three months ended
May 2, 1999 and April 26, 1998, respectively.
Included in operating expenses are corporate overhead expenses of
$421,444, or 15.0% of total revenues, for the three months ended May 2, 1999,
as compared to $391,518, or 13.4% of total revenues, for the three months
ended April 26, 1998, representing an increase of approximately $30,000 for
the comparable period. The increase is attributable to the addition of a
Chief Operating Officer in November 1998. It is expected that corporate
overhead will decrease as a percentage of sales as new retail stores and
additional distribution is added. Efforts to continue to improve and utilize
technological resources and control administrative costs are ongoing.
Also included in total operating expenses are depreciation and
amortization expenses that were $124,138 and $123,499 for the three months
ended May 2, 1999 and April 26, 1998, respectively.
As a result of the foregoing, the loss from operations for the three
months ended May 2, 1999 was $233,181, as compared with a loss from operations
for the three months ended April 26, 1998 of $329,935, an improvement of
$96,754.
Interest expense was $14,081 and $16,709 for the three months ended May
2, 1999, and April 26, 1998, respectively, and is comprised primarily of
interest charged on the Bank Note discussed above. Interest income was $3,365
and $6,865 for the three months ended May 2, 1999, and April 26, 1998,
respectively, and results from the daily investing of available cash balances.
Other income was $4,709 and $8,201 for the three months ended May 2,
1999, and April 26, 1998, respectively, and consists almost entirely of
license fees associated with extension agreements that will allow certain
former franchisees to use the Impostors trademark. The license agreements have
a one-year term expiring in January 2000, and are renewable at our option.
Based on the foregoing, the net loss for the three months ended May 2,
1999 was $239,188, which translates to a net loss per share of $(0.24) based
on 990,377 weighted average shares outstanding. This compares with a net loss
for the three months ended April 26, 1998 of $331,578, or $(0.37) per share,
based on 887,513 weighted average shares outstanding as of that date.
Other than the foregoing, no trends, or other demands, commitments,
events or uncertainties are known that will result in, or that are reasonably
likely to result in, a material impact on the income and expenses of the
Company.
Year 2000
- ---------
The Year 2000 Issue is the result of computer programs being written
using two digits rather than four to define the applicable year. Any of 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. The Company
is working to resolve the potential impact of the year 2000 by upgrading
certain aspects of its computer hardware and software systems, and presently
believes that these efforts will mitigate the year 2000 issue. A timeline has
been established to complete the project prior to any potential impact and
completion of the project is expected to occur timely. However, 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. The Company has also initiated 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 remedy their own Year
2000 Issue. Expenditures in fiscal 1999 for the year 2000 project were
nominal and management expects that completion of the project may result in
additional expenditures which should not be material. In view of the
foregoing, there is reasonable assurance that the Year 2000 Issue will not
have a material adverse effect upon the Company. However, there can be no
guarantee that the systems of other companies on which the Company's business
relies will be timely converted, or that 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.
<PAGE>
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Default Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of security holders during the
quarter ended May 2, 1999.
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
Exhibits:
Exhibit 27 - Financial Data Schedule
Reports on Form 8-K:
None
<PAGE>
<PAGE>
SIGNATURE
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 hereunto duly authorized.
PREMIER CONCEPTS, INC.
Dated: June 18, 1999 By: /s/ Sissel Greenberg
------------- -----------------------------
Sissel Greenberg, President
Dated: June 18, 1999 By: /s/ Todd Huss
------------- -----------------------------
Todd Huss, Chief Financial
Advisor, Principal Accounting
Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEETS AND CONSOLIDATED STATEMENT OF OPERATIONS AND
COMPREHENSIVE INCOME FOUND ON PAGES 4 AND 5 OF THE COMPANY'S FORM 10-QSB FOR THE
THREE MONTHS ENDED MAY 2, 1999, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-31-1999
<PERIOD-END> MAY-02-1999
<CASH> 273,720
<SECURITIES> 0
<RECEIVABLES> 66,589
<ALLOWANCES> (35,698)
<INVENTORY> 1,832,073
<CURRENT-ASSETS> 2,235,189
<PP&E> 4,184,991
<DEPRECIATION> (1,596,662)
<TOTAL-ASSETS> 4,954,584
<CURRENT-LIABILITIES> 1,679,914
<BONDS> 0
0
0
<COMMON> 2,128
<OTHER-SE> 2,623,896
<TOTAL-LIABILITY-AND-EQUITY> 4,954,584
<SALES> 2,815,098
<TOTAL-REVENUES> 2,815,098
<CGS> 865,035
<TOTAL-COSTS> 2,183,244
<OTHER-EXPENSES> (4,709)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 14,081
<INCOME-PRETAX> (239,188)
<INCOME-TAX> 0
<INCOME-CONTINUING> (239,188)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (239,188)
<EPS-BASIC> (0.242)
<EPS-DILUTED> (0.242)
</TABLE>
