SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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 quarterly period ended December 31, 1997
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 0-21178
UNITED TEXTILES & TOYS CORP.
(Exact name of registrant as specified in its charter)
Delaware 13-3626613
(State or other jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or organization)
448 West 16th Street, New York, New York 10011
(Address of principal executive offices)
(212) 675-6666
(Registrant's telephone number, including area code)
(Former name, former address, and former fiscal year,
if changed since last report)
Check whether the Issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 12
months (or for such shorter period that registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days. Yes [X] No [ ]
State the number of shares of each of the issuer's classes of common equity
outstanding as of the latest practicable date: Common Stock, $.001 per share:
978,807 shares outstanding as of December 31, 1997.
Transitional Small Business Disclosure Format (check one): Yes [ ] No [X]
<PAGE>
UNITED TEXTILES & TOYS CORP. AND SUBSIDIARY
CONTENTS
<TABLE>
<CAPTION>
Page
Number
PART 1- FINANCIAL INFORMATION
ITEM 1- FINANCIAL STATEMENTS
<S> <C>
Consolidated balance Sheets as of December 31, 1997 (Unaudited)
and March 31, 1997 3
Consolidated statements of Operations (Unaudited) for the three months
ended December 31, 1997 and December 31, 1996
and for the nine months ended December 31, 1997 and December 31, 1996 4
Consolidated statements of Cash Flows (Unaudited) for the three months
ended December 31, 1997 and December 31, 1996 and for the nine months
ended December 31, 1997 and December 31, 1996 5
Notes to Financial Statements (Unaudited) 6
ITEM 2- MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS 8
PART II- OTHER INFORMATION 12
Signatures 13
</TABLE>
<PAGE>
UNITED TEXTILES & TOYS CORP. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
As of December 31, 1997 and March 31, 1997
<TABLE>
<CAPTION>
December 31, March 31,
1997 1997
(Unaudited) (Note 1)
ASSETS
CURRENT ASSETS:
<S> <C> <C>
Cash and cash equivalents ....................................................... $ 2,826,080 $ 144,668
Accounts receivable-net ......................................................... 367,314 181,420
Inventories ..................................................................... 7,403,118 7,124,035
Prepaid expenses and other current assets ....................................... 169,012 252,901
Loans and advances-officer ...................................................... 170,798 123,600
------------ ------------
Total current assets .................................................... 10,936,322 7,826,624
------------ ------------
PROPERTY AND EQUIPMENT-NET ....................................................... 2,890,606 2,478,706
------------ ------------
OTHER ASSETS:
Deposits and other assets ....................................................... 185,882 332,017
------------ ------------
Total assets ............................................................ $ 14,012,810 $ 10,637,347
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Borrowings under financing agreement ............................................ $ 4,746,307 $ 4,438,875
Accounts payable ................................................................ 6,571,093 3,318,472
Accrued expenses and other current liabilities .................................. 938,600 510,447
Due to affiliates ............................................................... 1,698,935 804,000
Current portion of notes payable ................................................ 100,000 141,666
------------ ------------
Total current liabilities ............................................... 14,054,935 9,213,460
------------ ------------
LONG-TERM LIABILITIES:
Note payable, net of current portion ............................................ 25,000 100,000
Deferred rent liability ......................................................... 155,998 126,925
------------ ------------
Total long-term liabilities ............................................. 180,998 226,925
------------ ------------
Total liabilities ....................................................... 14,235,933 9,440,385
------------ ------------
MINORITY INTEREST IN SUBSIDIARY .................................................. 1,668,302 2,007,180
------------ ------------
STOCKHOLDERS' EQUITY:
Common stock, $.01 par value; 10,000,000
shares authorized, 9,788,050 shares issued
and outstanding ................................................................ 97,881 97,881
Additional paid-in capital ..................................................... 7,048,950 7,048,950
Common stock subscribed ......................................................... 150,000 150,000
Retained earnings (Deficit) ..................................................... (9,188,256) (8,107,049)
------------ ------------
Total stockholders' equity .............................................. (1,891,425 (810,218)
Total liabilities and stockholders' equity $ 14,012,810 $ 10,637,347
------------ -------------
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements
-3-
<PAGE>
UNITED TEXTILES & TOYS CORP. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
For the For the
Nine Months Ended Three Months Ended
Dec 31, Dec 31, Dec 31, Dec, 31
1997 1996 1997 1996
------ ----- ----- -----
<S> <C> <C> <C> <C>
REVENUES, net sales .......................... $ 18,189,858 $ 17,014,944 $ 10,473,363 $ 9,616,043
------------ ------------ ------------ ------------
COSTS AND EXPENSES:
Cost of sales ............................... 11,422,925 12,405,236 6,596,501 7,001,499
Operating expenses .......................... 7,501,813 7,169,456 2,948,174 3,113,530
Interest and other income -- (35,502) -- --
Interest expense 685,205 599,897 254,586 229,215
------------ ------------ ------------ ------------
19,609,943 20,139,087 9,799,261 10,344,244
------------ ------------ ------------ ------------
INCOME (LOSS) BEFORE
MINORITY INTERESTS ........................ (1,420,085) (3,124,143) 674,102 (728,201)
Minority interest in net income (loss)
of consolidated subsidiary (Note 2) ...... (338,878) (899,297) 343,851 (157,430)
------------ ------------ ------------ ------------
INCOME (LOSS) BEFORE PROVISION
FOR INCOME TAXES ........................... (1,081,207) (2,224,846) 330,251 (570,771)
------------ ------------ ------------ ------------
Provision for income taxes ................... -- -- -- --
------------ ------------ ------------ ------------
NET INCOME (LOSS) ............................ $ (1,081,207) $ (2,224,846) $ 330,251 $ (570,771)
============ ============ ============ ============
Basic earnings and diluted(loss)
per common share before minority interest .. $ (.14) $ (.65) $ .069 $ (.13)
Minority interest in net income (loss)
of consolidated subsidiary ................. (.03) (.19) .035 (.03)
------------ ------------ ------------ ------------
Basic and diluted earnings (loss)
per common share ........................... $ (.11) $ (.46) $ .034 $ (.10)
============ ============ ============ ============
Weighted average number
of common shares outstanding ............... 9,788,050 4,833,868 9,788,050 5,588,050
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements
-4-
<PAGE>
UNITED TEXTILES & TOYS CORP. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
Increase (Decrease) in Cash
<TABLE>
<CAPTION>
Nine Months Ended
December 31, December 31,
1997 1996
----- ------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net loss .................................................... $(1,081,207) $(2,224,846)
----------- -----------
Adjustments to reconcile net loss to cash (used)
provided for operating activities:
Depreciation and amortization ............................. 441,172 354,302
Deferred rent ............................................. 29,073 (12,966)
Minority interest in net loss of subsidiary ............... (338,878) (899,297)
Compensatory options and stock issued by subsidiary ....... -- 16,000
Changes in assets and liabilities:
(Increase) in Accounts receivable ........................... (185,894) 35,524
(Increase) in Merchandise inventories (279,083) 1,028,089
Decrease in prepaid expenses and other current assets ...... 83,889 (60,196)
Decrease in deposits and other assets ....................... 146,135 --
Increase in accounts payable ................................ 3,252,621 537,549
Increase in accrued expenses and other liabilities ......... 428,153 214,997
----------- -----------
Total adjustments .................................. 3,577,188 1,214,002
----------- -----------
Net cash provided by operating activities .......... 2,495,981 (1,010,844)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment ........................ (853,072) (447,951)
Advances from affiliates ................................... 894,935 24,294
----------- -----------
Net cash (used for) investing activities ........... 41,863 (123,657)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings under financing agreement ................... 307,432 --
Proceeds from sale of common stock ......................... -- 79,451
Repayment of shareholder loans ............................. -- (87,680)
Investment by minority shareholders ........................ -- 1,234,000
Repayment of notes payable ................................. (116,666)
Reduction (increase) in loans receivable-officer ........... (47,198) --
----------- -----------
Net cash provided by( used for) investing activities 143,568 1,225,771
----------- -----------
NET INCREASE (DECREASE) IN CASH ............................. 2,681,412 91,270
Cash, beginning of period ................................... 144,668 75,573
----------- -----------
Cash, end of period ......................................... $ 2,826,080 $ 166,843
=========== ===========
Supplemental disclosure of cash flow information:
Interest paid ............................................... $ 685,205 $ 599,897
Taxes paid .................................................. $ -- $ --
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements
-5-
<PAGE>
UNITED TEXTILE & TOYS CORP. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1- BASIS OF PRESENTATION:
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles
for interim financial information and the instructions to Form 10-QSB.
Accordingly, they do not include all the information and footnotes
required by generally accepted accounting principles for more complete
financial statements. In the opinion of management, the interim
financial statements include all adjustments considered necessary for a
fair presentation of the Company's financial position and the results
of its operations for the nine months ended December 31, 1997, and are
not necessarily indicative of the results to be expected for the full
fiscal year. For further information, refer to the Company's Annual
report on Form 10-KSB for the fiscal year ended March 31, 1997, as
filed with the Securities and Exchange Commission.
Note 2- DESCRIPTION OF COMPANY:
Until July 1996, the Company was the majority shareholder of
American Toys, Inc. ("American Toys") now known as U.S. Wireless
Corporation. Since American Toys was then the majority shareholder of
Play Co. Toys & Entertainment Corp. ("Play Co."), the Company
indirectly held the majority of Play Co. shares. By corporate
resolution dated June 1, 1996, the Company authorized its subsidiary,
American Toys to spin-off ("The spin-off Distribution") the Play Co.
common shares owned by American Toys to American Toy's stockholders.
The spin-off distribution was affected in August 1996.
The Company owns 2,489,581 shares or 61% of the Play Co. common
stock outstanding. The Company. The Company acquired an additional
70,000 shares of common stock in September 1997 to increase its
ownership percentage to 61% from 59%.
Note 3- MINORITY INTERESTS:
The minority interest in Play Co. Toys & Entertainment Corp.
represents the minority shareholders portion (39%) of Play Co.'s
equity at December 31, 1997. The minority interest as reflected in the
accompanying consolidated balance sheet consists of Play Co.'s Series
E Preferred Stock only. Due to operating losses of Play Co., the
minority interest in common stock has been written down to zero.
Note 4- NEW ACCOUNTING PRONOUNCEMENT:
For the quarter ended December 31, 1997, the Company adopted the
provisions of Statement of Financial Accounting Standards No. 128,
"Earnings per Share". Under this Standard, the Company is required to
report basic and diluted (loss) per share. Basic earnings (loss) per
share is calculated by dividing the net income (loss) for each period
by the weighted average number of common shares outstanding. Diluted
earnings (loss) per share is similar in calculation except that the
weighted average number of common shares is increased to reflect the
effects of potential additional shares that would result from the
exercise of stock options or other convertible instruments.
-6-
<PAGE>
UNITED TEXTILES & TOYS CORP. AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 4- NEW ACCOUNTING PRONOUNCEMENT (continued)
For the nine months ended December 31, 1997 and 1996, there is no
difference between basic and diluted earnings (loss) per share as the inclusion
of additional potential shares is anti-dilutive due to the net loss presented in
each period.
Note 5- SUBSEQUENT EVENTS:
On January 2, 1998, the Company issued 3,571,429 shares of its common
stock to Multimedia Concepts International , Inc. ("Multimedia") a company of
which the Company's President is also President, Chief Executive Officer and a
Director. The issuance of these common shares at a price of $.28 per share ($.01
above the closing price on December 31, 1997) represented payment for $1,000,000
loaned to the Company by Multimedia.
As a result of this transaction, Multimedia owns 78.5% of the
outstanding shares of common stock of the Company, effectively making the
Company a subsidiary of Multimedia. As the Company owns 61% of the outstanding
shares of common stock of Play Co., thus Multimedia and its management have
obtained beneficial voting control of Play Co.
On January 20, 1998, U.S. Stores Corp. ("U.S. Stores") acquired 1,465,000
shares of Multimedia's of common stock. U.S. Stores was incorporated on November
10, 1997. The Company's president is also President and Director of U.S. Stores.
After this transaction, U.S. Stores held an aggregate of 1,868,000 shares of
Multimedia's common stock or 63% of the outstanding shares, effectively making
Multimedia a subsidiary of U.S. Stores.
-7-
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS:
Results of Operations
Statements contained in this report which are not historical facts may
be considered forward looking information with respect to plans, projections or
future performance of the Company as defined under the Private Securities
Litigation Reform Act of 1995. These forward looking statements are subject to
risks and uncertainties which could cause actual results to differ materially
from those projected.
Three months ended December 31, 1997 compared to the three months ended
December 31, 1996:
Consolidated sales for the three months ended December 31, 1997 were
$10,474,363 as compared to $9,616,043 for the three months ended December 31,
1996. This increase of $857,320 or 8.9% is directly attributable to increased
sales contributions from Play Co.'s retail stores.
Consolidated cost of sales for the three months ended December 31, 1997
were $6,596,501 or 63% of sales as compared to the three month period ended
December 31, 1996 in which cost of sales were $7,001,499 or 72.8% of sales. This
decrease of $404,998 or 5.8% is primarily due to management's efforts to better
control costs and product mix.
Consolidated operating expenses were $2,948,174 or 28.1% of sales as
compared to $3,113,530 or 32.4% of sales in the three months ended December 31,
1996. This decrease of $165.356 or 5.3% was due to better management control
over operating expenses.
During the three months ended December 31, 1997, non-cash depreciation and
amortization were $162,482 as compared to $52,197 in the three months ended
December 31, 1996. This increase of $110,285 is due primarily to depreciation on
assets new assets acquired by Play Co. in this quarter.
Consolidated interest expense was $254,586 or 2.4% of sales in the three
months ended December 31, 1997 as compared to $229,215 or 2.4% of sales in the
three months ended December 31, 1996.
For the three months ended December 31, 1997 the Company reported
consolidated net income of $330,251 (after reflecting the adjustment for the
minority interest in Play Co.) or basic earnings per share of $.034as compared
to a net loss of $570,771 or a basic loss per share of $(.10) (after reflecting
the minority interest in Play Co.) for the three months ended December 31, 1996.
The weighted average number of common shares used in the computation of basic
earnings per share was 9,788,050 for the three months ended December 31, 1997
and 5,588,050 for the three months ended December 31, 1996.
Nine months ended December 31, 1997 compared to the nine months ended
December 31, 1996:
Consolidated sales were $18,189,858 for the nine months ended December 31,
1997 as compared to $17,014,944 for the nine months ended December 31, 1996.
This increase of $1,184,914 or 7% was due to increased sales contributions from
Pay Co.'s retail stores.
-8-
<PAGE>
Consolidated cost of sales were $11,422,925 or 62.8% of sales for the nine
months ended December 31, 1997 as compared to $12,405,236 or 72.9% of sales for
the nine months ended December 31, 1996. This decrease of $982,311 or 7.9% was
due management's efforts to better control costs and product mix.
Consolidated operating expenses were $7,501,813 or 41.2% of sales for the
nine months ended December 31, 1997 as compared to $7,169,456 or 42.1% of sales
for the nine months ended December 31, 1996. This increase of 4.6% was due
primarily to increased operating expenses of Play Co., specifically rent and
payroll expenses associated with new retail store openings.
For the nine months ended December 31, 1997, non-cash depreciation and
amortization were $441,172 as compared to $354,302 for the nine months ended
December 31, 1996. This increase of $86,870 was due to depreciation on new
assets acquired by Play Co. in the nine months ended December 31, 1997.
Consolidated interest expense was $685,205 or 3.8% of sales for the nine
months ended December 31, 1997 as compared to $599,897 or 3.5% of sales for the
nine months ended December 31, 1996. This increase of $85,308 or14.2% was due to
increased borrowings by Play Co. under its financing agreement.
For the nine months ended December 31,1 997, the Company reported a
consolidated net loss of $1,081,207 (after reflecting the adjustment for the
minority interest in Play Co.) or basic loss per share of $(.11), as compared to
a loss of $2,224,846 or basic loss per share of $(.46) (after reflecting the
minority interest in Play Co.) for the nine months ended December 31, 1996. The
weighted average number of common shares used in the computation of basic
earnings (loss) per share was 9,788,050 for the nine months ended December 31,
1997 and 4,833,868 for the nine months ended December 31, 1996.
Liquidity and Capital Resources
At December 31, 1997, the Company reported cash and cash equivalents of
$2,826,080, negative working capital of $(3,118,613) and stockholders' equity of
$(1,891,425) reflecting the net loss of $1,081,207 for the nine months ended
December 31, 1997..
At March 31, 1997, the Company reported cash and cash equivalents of
$144,668, negative working capital of $(1,386,836) and stockholders' equity of
$(810,218).
On December 29, 1997, Play Co. completed a public offering of Series E
preferred shares and Series E warrants. The offering was managed by West America
Securities. The offering raised $3,150,000 in gross proceeds. Play Co. estimates
that the net proceeds of the offering were $2,378,978 after discounts and
commissions, legal expenses, Blue Sky fees, accounting fees,printing expenses,
other investment banking fees and other miscellaneous costs and expenses. Play
Co. will finalize the net proceeds of the offering during the audit process on
its March 31, 1998 year end financial statement.
-9-
<PAGE>
On January 21, 1997, Play Co. entered into a $7.1 million secured,
revolving Loan and Security Agreement with FINOVA Capital Corporation ("FINOVA"
or "FINOVA AGREEMENT"). The FINOVA Agreement replaces the $7 million credit
arrangement Play Co. had with Congress Financial Corporation("Congress
Arrangement"). The FINOVA Agreement is secured by substantially all of the Play
Co.'s assets and it expires on July 21, 1000. The interest rate of floating
prime plus one and one-half percent is the same in both credit arrangements.
Under the FINOVA Agreement, Play Co. will be able to borrow $2.4 million
against a combination of $3 million in standby letters of credit and restricted
cash provided by a subordinated loan compared to a $2 million advance against $3
million in additional borrowing support from the standby letters of credit under
the Congress Arrangement. $1.5 million of the $3 million in additional borrowing
support from the standby letters of credit was provided by an institutional
investor in the form of a subordinated loan, $1.o million was provided in the
form of a standby letter of credit by the Company. The other $500,000 was
provided by Play Co.. Under both agreements, Play Co. is able to borrow against
the cost value of eligible inventory. Play Co. believes that its credit
availability against the cost value of its inventory under the FINOVA Agreement
will be comparable to its availability under the Congress Arrangement.
The toy industry is seasonal with approximately 45% to 49% of Play Co.'s
annual sales occurring during the months of October through December. As a
result, source of funds to repay amounts due under inventory finance
arrangements with financial institutions and manufacturers are typically
generated from sales during the peak selling season.
United Textiles & Toys Corp.'s business is not seasonal with women's
apparel being sold throughout the year.
Play Co. plans to open additional stores and the cost of opening will be a
significant capital expenditure. Play Co. plans to partially finance these
capital expenditures through a combination of landlord tenant improvement
contributions, borrowings on its new credit line and from capital leases. The
remainder will be paid out of Play Co.'s working capital.
Trends affecting liquidity, capital resources and operations
Play Co.'s sales efforts are focused primarily on a defined geographic
consisting of the Southern California area and the Southwestern United States.
Play co.'s future financial performance will depend upon the continued demand
for toys and hobby items and on general economic conditions within that
geographic market area, Play co.'s ability to choose locations for new stores,
its ability to purchase at favorable prices and the effects of increased
competition and changes in consumer preferences.
The toy and hobby retail industry faces a number of potentially adverse
business conditions including price and gross margin pressures and market
consolidation. The domination of the toy industry by Toys R Us has resulted in
increased price competition among various toy retailers and declining gross
margins for such retailers, Moreover, the domination by Toys R Us has resulted
in the liquidation or bankruptcy of many toy retailers in the United States,
including some in the Southern California market. There can be no assurance that
Play Co.'s business strategy will enable it to compete effectively in the retail
toy industry.
-10-
<PAGE>
Management knows of no other trends reasonably expected to have a material
impact upon Play Co.'s operations or liquidity in the foreseeable future. Play
Co.'s operating history has been characterized by narrow profit margins and
accordingly, Play Co.'s earnings will depend significantly on its ability to
purchase its product on favorable terms, retail a large volume and variety of
products and to provide quality support services. Play Co.'s prices are, in part
based on market surveys of its competitors' prices, primarily of Toys R Us. As a
result, aggressive pricing policies, such as those used by Toys R Us, have
resulted in Play Co. reducing its retail prices on many items, thereby reducing
the available profit margin. Moreover, increases in expenses or other charges to
income may have a material effect on Play Co.'s results of operations. There can
be no assurance that Play Co. will be able to generate sufficient revenues or
have sufficient controls over expenses and other charges to increase
profitability.
Other
The Company believes that its present financial resources as well as funds
it anticipates generating from operations and Play Co.'s line of credit will be
adequate to meet its needs for at least the ensuing twelve month period.
Inflation and seasonality
During the past few years, inflation in the United States has been
relatively stable in management's opinion, this is expected to continue for the
foreseeable future. However, should the American economy again experience double
digit inflation rates,as was the case in the past, the impact upon prices could
adversely affect the Company's operations.
-11-
<PAGE>
PART II - OTHER INFORMATION
ITEM 1 - Legal Proceedings: None
ITEM 2 - Changes in Securities: None
ITEM 3 - Defaults Upon Senior Securities: None
ITEM 4 - Submission of Matters to a Vote of Security Holders: None
ITEM 5 - Other Information:
On January 2, 1998, the Company issued 3,571,429 shares of its common stock
to Multimedia Concepts International , Inc. ("Multimedia") a company of which
the Company's President is also President, Chief Executive Officer and a
Director. The issuance of these common shares at a price of $.28 per share ($.01
above the closing price on December 31, 1997) represented payment for $1,000,000
loaned to the Company by Multimedia.
As a result of this transaction, Multimedia owns 78.5% of the outstanding
shares of common stock of the Company, effectively making the Company a
subsidiary of Multimedia. As the Company owns 61% of the outstanding shares of
common stock of Play Co., thus Multimedia and its management have obtained
beneficial voting control of Play Co.
On January 20, 1998, U.S. Stores Corp. ("U.S. Stores") acquired 1,465,000
shares of Multimedia's of common stock. U.S. Stores was incorporated on November
10, 1997. The Company's president is also President and Director of U.S. Stores.
After this transaction, U.S. Stores held an aggregate of 1,868,000 shares of
Multimedia's common stock or 63% of the outstanding shares, effectively making
Multimedia a subsidiary of U.S. Stores.
ITEM 6 - Exhibits and Reports on Form 8-K:
Exhibits: None
Reports on Form 8-K: None
-12-
<PAGE>
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.
Dated: February 27, 1998
United Textiles & Toys Corp.
(Registrant)
/s/Ilan Arbel
Ilan Arbel
President
/s/Allean Goode
Allean Goode
Treasurer
-13-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
UNITED TEXTILES & TOYS CORP. AND SUBSIDIARIES
EXHIBIT
FINANCIAL DATA SCHEDULE
ARTICLE 5 OF REGULATION S-X
The schedule contains summary financial information extracted from the
financial statements for the year ended December 31, 1997 and is qualified in
its entirety by reference to such statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> mar-31-1997
<PERIOD-END> dec-31-1997
<CASH> 2,826,080
<SECURITIES> 0
<RECEIVABLES> 367,314
<ALLOWANCES> 0
<INVENTORY> 7,403,118
<CURRENT-ASSETS> 10,936,322
<PP&E> 6,195,787
<DEPRECIATION> (3,305,181)
<TOTAL-ASSETS> 14,012,810
<CURRENT-LIABILITIES> 14,054,935
<BONDS> 0
0
0
<COMMON> 97,881
<OTHER-SE> (1,989,306)
<TOTAL-LIABILITY-AND-EQUITY> 14,012,810
<SALES> 18,189,858
<TOTAL-REVENUES> 18,189,858
<CGS> 11,422,295
<TOTAL-COSTS> 7,501,813
<OTHER-EXPENSES> 7,501,813
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 685,205
<INCOME-PRETAX> (1,081,207)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,081,207)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,081,207)
<EPS-PRIMARY> (.11)
<EPS-DILUTED> (.11)
</TABLE>
