<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _____ to _____
Commission File No. 33-55254-28
FIRST CAPITAL RESOURCES.COM, INC.
---------------------------------
(Exact name of Registrant as specified in its charter)
NEVADA 87-0438641
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
2650 McCormick Drive, Suite 185
Clearwater, Florida 33759
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (727) 791-6510
------------------
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 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
Indicate the number of shares outstanding of each of the registrant's classes
of common stock, as of the latest practicable date.
Class Outstanding as of March 31, 2000
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$.001 PAR VALUE CLASS A COMMON STOCK 11,300,000 SHARES
<PAGE> 2
FIRST CAPITAL RESOURCES.COM, INC.
INDEX
Page #
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Part I. Financial Information
Item 1. Financial Statements
Condensed consolidated balance sheet - March 31, 2000 and
December 31, 1999 3
Condensed consolidated statements of operations - Three months
ended March 31, 2000 and three months ended March 31, 1999 4
Condensed consolidated statement of cash flows - Three months
ended March 31, 2000 and three months ended March 31, 1999 5
Notes to condensed consolidated financial statements 6
Item 2. Management's Discussion and Analysis 7 - 8
Part II. Other Information 9
Signatures 10
<PAGE> 3
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
FIRST CAPITAL RESOURCES.COM, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
March 31, 2000 December 31, 1999
---------------- -----------------
(Unaudited)
<S> <C> <C>
ASSETS:
Finance receivables, net $ 1,385,044 $ 2,040,565
Cash and cash equivalents 1,420,341 596,515
Loans Receivable 521,370 522,329
Property and equipment, net 13,751 20,450
Real Estate held for Sale 171,000 171,000
Other assets 34,768 73,274
---------------- ----------------
TOTAL ASSETS $ 3,546,274 $ 3,424,133
================ ================
LIABILITIES AND DEFICIENCY IN ASSETS:
Liabilities:
Accounts payable and other liabilities 163,762 168,655
Notes payable 186,813 188,880
Due to parent company 5,433,198 5,288,832
---------------- ----------------
TOTAL LIABILITIES 5,783,773 5,646,367
---------------- ----------------
Deficiency in assets:
Common stock, par value $.001 per share; 100,000,000
shares authorized, 11,300,000
shares issued and outstanding 11,300 11,300
Additional paid-in capital 1,950,908 1,950,908
Accumulated deficit (4,199,707) (4,184,442)
---------------- ----------------
Total Deficiency in Assets (2,237,499) (2,222,234)
---------------- ----------------
TOTAL LIABILITIES AND DEFICIENCY IN
ASSETS $ 3,546,274 $ 3,424,133
================ ================
</TABLE>
See notes to condensed consolidated financial statements - unaudited.
3
<PAGE> 4
FIRST CAPITAL RESOURCES.COM, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Three months ended Three months ended
March 31, 2000 March 31, 1999
(Unaudited) (Unaudited)
------------ -----------
<S> <C> <C>
REVENUES:
Loan interest and fee income $ 313,254 $ 150,649
Less: Interest expense (129,188) --
------------ -----------
Net Interest Income 184,066 150,649
------------ -----------
Provision for credit losses -- 10,000
------------ -----------
Net interest income after provision for Credit losses 184,066 140,649
OTHER INCOME:
Automobile Sales -- 159,318
OPERATING AND OTHER EXPENSES:
Cost of automobile sales -- 124,786
Consulting fees 105,826 --
G & A expenses 93,505 159,176
------------ -----------
Total expenses 199,331 283,962
------------ -----------
Income (loss) before income taxes (15,265) 16,005
Income tax expense -- (7,350)
------------ -----------
Net income (loss) (15,265) 8,655
============ ===========
Earnings per share - basic and diluted $ 0.00 $ 0.01
============ ===========
Weighted average number of shares outstanding 11,300,000 1,000,000
</TABLE>
See notes to condensed consolidated financial statements - unaudited.
4
<PAGE> 5
FIRST CAPITAL RESOURCES.COM, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three months ended Three months ended
March 31, 2000 March 31, 1999
(Unaudited) (Unaudited)
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (15,265) 8,655
----------- -----------
Adjustments to reconcile net loss to net cash used in operating
activities:
Depreciation 6,699 --
Imputed interest on advances from Parent 129,188 --
Accretion of discount and unearned interest on finance
contracts (228,202) --
Inventory -- (295,450)
Decrease in other assets 38,506 (14,076)
Decrease in accounts payable (4,893) 89,303
----------- -----------
Total adjustments (58,702) (220,223)
----------- -----------
Net cash used in operating activities (73,967) (211,568)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property & equipment -- (28,217)
Amounts from the repayment (issuance) of loans receivable 959 (221,524)
Amounts from the repayment (purchase) of finance contracts 324,778 (349,757)
Decrease (increase) in floor plan receivables 558,945 (642,714)
----------- -----------
Net cash provided by (used in) investing activities 884,682 (1,242,212)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Amounts advanced by (repaid to) Parent Company 15,178 (6,747)
Repayments of long-term debt (2,067) --
Capital contributed by Shareholder -- 1,995,675
----------- -----------
Net cash provided by financing activities 13,111 1,988,928
----------- -----------
NET INCREASE IN CASH AND CASH EQUIVALENTS 823,826 535,148
CASH AND EQUIVALENTS - BEGINNING OF PERIOD 596,515 121,709
----------- -----------
CASH AND EQUIVALENTS - END OF PERIOD $ 1,420,341 $ 656,857
=========== ===========
Supplemental Disclosures of Non-Cash Transactions:
Property and equipment contributed to capital $ -- $ 68,476
=========== ===========
Finance contracts contributed to capital $ -- $ 134,902
=========== ===========
Interest paid $ -- $ --
=========== ===========
</TABLE>
See notes to condensed consolidated financial statements - unaudited.
5
<PAGE> 6
FIRST CAPITAL RESOURCES.COM, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The accompanying condensed consolidated (unaudited) financial statements of
First Capital Resources.Com, Inc., have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-QSB and, therefore, do not include all
information and footnotes necessary for a complete presentation of financial
position, results of operations and cash flows in conformity with generally
accepted accounting principles.
In the opinion of management, all adjustments considered necessary for a fair
presentation of the results of operations and financial position have been
included and all such adjustments are of a normal recurring nature. Operations
for the quarter ended March 31, 2000, are not necessarily indicative of the
results that can be expected for the year ended December 31, 2000.
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions
that affect the amounts reported in the financial statements and accompanying
notes. Actual results could differ from these estimates.
The financial data at December 31, 1999 is derived from audited financial
statements which are included in the Company's form 10-K and should be read in
conjunction with the audited financial statements and the notes thereto.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of consolidation - The condensed consolidated financial statements
include First Capital Resources.Com, Inc., and its subsidiaries Affordable
Dealer Services, Inc. (Affordable), Southeast Dealer Acceptance, Inc.
(Southeast), Carnet, Inc. (Carnet) and FC Holdings Corp. All material
intercompany accounts and transactions have been eliminated.
3. GOING CONCERN UNCERTAINTIES
The Company sustained substantial operating losses and negative cash flows from
operations since inception through December 31, 1999. Its majority shareholder,
First American Capital Trust ("FACT") filed for relief from creditors under
Chapter 11 of the United States Bankruptcy Code. Although the Company has not
filed for bankruptcy protection, it is reasonably possible that FACT, the
principal source of liquidity for the Company, will not provide any more
capital to the Company. Further, the creditors of FACT or the United States
Bankruptcy Court could opt to liquidate FACT's assets, including the Company
and cause the Company to cease its operations.
The management of the Company, along with the management and advisors of FACT
and the creditors of FACT are currently attempting to develop and submit a
joint plan of reorganization to the bankruptcy court (the "Plan"). If an
agreement is reached by the parties and the Plan is confirmed by the U.S.
Bankruptcy Court, it is anticipated that the Plan will address the future
organization and business of the Company. The Plan is currently in the
formative stages and whether an agreement can be reached and its ultimate
effect on the Company can not be predicted at this time.
4. EARNINGS PER SHARE
Basic and diluted earnings per share was computed by dividing the net income
(loss) by the weighted average number of shares of common stock outstanding.
5. SEGMENT INFORMATION
At March 31, 1999, the Company principally operated as a finance company and a
used car dealership. The finance segment purchased automobile finance contracts
from pre-owned automobile dealerships and financed dealership floor plans
loans, while the used car dealership segment sold used automobiles, vans and
light trucks to consumers. The used car segment was sold on July 5, 1999. At
March 31, 2000, the Company only operated in one segment.
6
<PAGE> 7
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The following discussion and analysis provides information which management
believes is relevant to an assessment and understanding of the Company's
consolidated financial condition and results of operations and cash flows. The
discussion should be read in conjunction with the condensed financial
statements and notes thereto.
RESULTS OF OPERATIONS
Net revenues
Net interest income increased by 22.2% from $150,649 for the three month period
ended March 31, 1999 to $184,066 for the three months ended March 31, 2000. The
increase is due primarily to the fact that revenues from Southeast were only
$14,029 for the period last year as Southeast only commenced operations on
January 20, 1999 and did not start earning significant revenues until the
second quarter. Southeast had net revenues of $268,141 for the three month
period this year. The interest revenue in the period ended March 31, 2000 was
offset by interest expense that was imputed on the intercompany loan owing from
the Company to FACT.
Southeast currently has approximately 247 retail car loan accounts. These
accounts are being collected and no new loans are currently being made.
Accordingly revenues will remain steady for the next 2 to 3 quarters after
which the revenues will start to decline until they ultimately reduce to $0 by
approximately the end of next year.
Revenues from Affordable Dealer Services are also slowly declining as the
amount of Dealer loans currently outstanding has fallen from approximately
$1.4M at year end to approximately $790,000 at March 31, 2000. New Dealer loans
are being made however at a declining rate. Accordingly net revenues from
Affordable will either remain the same or slowly decline over the course of the
remainder of the fiscal year.
Revenues during the period ended March 31, 1999 include $159,318 in automobile
sales that were generated by the Company's subsidiary Carnet. There are no
comparable revenues this year as Carnet is inactive.
Net expenses
Net expenses for the three months ended March 31, 2000 were $199,331 as
compared to $283,962 for the comparable three months last year. Repossession
and towing expenses have increased significantly from $0 last year to
approximately $30,960 this period as the Company tries to aggressively protect
and collect the value of the retail car loan portfolio. Other selling, general
and administrative expenses are about the same as the comparable period last
year. Included in last years operating expenses were Costs related to
automobile sales in the amount of $124,786 from its Carnet subsidiary. There
are no such expenses this year as Carnet's operations have been discontinued.
General & Administrative expenses are slightly higher than last year despite
the fact that during the three months last year the Company had only just
commenced operations and was only in a start up phase whereas during the
comparable period this year the Company has been managing a full Dealer and
retail portfolio and has also been consolidating the Fort Lauderdale office
into the Clearwater office. Additionally an inordinate amount of time has been
spent during this period correcting many of the policies and procedures of the
former management.
Expenses are likely to fall slightly in the next quarter due to much of the
consolidation work being completed and the level of repossessions also falling
slightly as compared to this quarter. Thereafter expenses should remain steady
through the end of the fiscal year.
The net loss for the period was $15,265 as compared to a small profit of $8,655
for the three month period last year. This is due to the fact that although the
increase in revenues exceeded the increase in general & administrative
expenses, the Company incurred a significant interest expense during the period
due to the size of the debt to FACT. The Company should remain around the break
even level for the remainder of the year until a Plan of Reorganization is
prepared which will determine the Company's future after that period.
7
<PAGE> 8
LIQUIDITY AND CAPITAL RESOURCES
The Company currently has $1,420,341 of cash on hand and another $1,906,414 in
other loans and receivables against approximately $351,000 in accounts and
notes payable. Additionally, the Company is currently indebted to its Parent
Company, FACT in the amount of $5,433,198. As was disclosed in the previous
Report on Form 10-K, FACT has filed a voluntary petition for relief under
Chapter 11 of the U.S. Bankruptcy Code. FACT is currently working on a Plan of
Reorganization. The Plan is not yet final however it may include among other
things, a liquidation of the assets of the Company and repayment, to the extent
possible of the loans owing to FACT and a conversion of all or part of the debt
to additional shares in the Company. Further details are not expected until the
quarter ended June 30, 2000.
8
<PAGE> 9
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities and Use of Proceeds
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits required by Item 601 of Regulation S-K
The following exhibits are followed as part of this report:
Exhibits:
27.1 Financial Data Schedule
(b) Reports on Form 8-K
None
9
<PAGE> 10
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.
FIRST CAPITAL RESOURCES.COM, INC.
Date: May 13, 2000 By: /s/ Derri Davisson
------------------------------------
Derri Davisson, President
Date: May 13, 2000 By: /s/ J. Stephen Miller
------------------------------------
J. Stephen Miller,
Chief Financial Officer
10
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 1,420,341
<SECURITIES> 0
<RECEIVABLES> 2,457,089
<ALLOWANCES> (550,675)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 19,111
<DEPRECIATION> 5,360
<TOTAL-ASSETS> 3,546,274
<CURRENT-LIABILITIES> 0
<BONDS> 186,813
0
0
<COMMON> 11,300
<OTHER-SE> (2,233,534)
<TOTAL-LIABILITY-AND-EQUITY> 3,546,274
<SALES> 0
<TOTAL-REVENUES> 184,066
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 199,331
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 129,188
<INCOME-PRETAX> (15,265)
<INCOME-TAX> 0
<INCOME-CONTINUING> (15,265)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (15,265)
<EPS-BASIC> 0.00
<EPS-DILUTED> 0.00
</TABLE>
