<PAGE> 1
- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934.
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1999
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: 0-21802
----------
N-VIRO INTERNATIONAL CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 34-1741211
(STATE OR OTHER JURISDICTION OF (IRS EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
3450 W. CENTRAL AVENUE, SUITE 328
TOLEDO, OHIO 43606
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (419) 535-6374
----------
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to the filing requirements for at least the past 90 days. Yes X No .
As of May 7, 1999, 2,579,733 shares of N-Viro International
Corporation $ .01 par value common stock were outstanding.
- --------------------------------------------------------------------------------
-1-
<PAGE> 2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
N-VIRO INTERNATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31
---------------------------
1999 1998
----------- -----------
<S> <C> <C>
Revenues $ 978,124 $ 1,032,257
Cost of revenues 486,089 462,946
----------- -----------
Gross profit 492,035 569,311
Selling, general & administrative expenses 462,442 485,076
----------- -----------
Operating income 29,593 84,235
Nonoperating income (expense):
Interest income (expense), net 2,552 (4,751)
Equity in losses of joint venture (14,190) (9,522)
Miscellaneous expense -- (2,250)
----------- -----------
Income before income tax (credits) 17,955 67,712
Federal and state income tax (credits) -- --
----------- -----------
Net income $ 17,955 $ 67,712
=========== ===========
Basic and diluted earnings per share $ 0.01 $ 0.03
=========== ===========
Weighted average common shares outstanding 2,522,483 2,448,483
=========== ===========
</TABLE>
See Notes to Consolidated Financial Statements
-2-
<PAGE> 3
N-VIRO INTERNATIONAL CORPORATION
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
1999 1998
ASSETS (Unaudited) (Audited)
------------ ------------
<S> <C> <C>
Current Assets
Cash and cash equivalents $ 359,510 $ 322,827
Securities available-for-sale 1,740 1,401
Trade receivables 872,366 802,913
Notes receivable 188,236 197,839
Related party receivables 37,194 46,790
Prepaid expenses and other assets 144,730 81,644
------------ ------------
Total current assets 1,603,776 1,453,414
Property and Equipment 547,553 577,116
Investment in Florida N-Viro, L.P. 838,320 852,510
Deferred Tax Assets 312,000 312,000
Intangibles and Other Assets 745,500 588,312
------------ ------------
TOTAL ASSETS $ 4,047,149 $ 3,783,352
============ ============
LIABILITIES & STOCKHOLDERS' EQUITY
Current Liabilities
Current maturities of long-term debt $ 136,723 $ 93,640
Accounts payable 817,439 729,427
Accrued expenses 227,738 226,790
------------ ------------
Total current liabilities 1,181,900 1,049,857
------------ ------------
Long-Term Debt, less current maturities 170,029 67,547
------------ ------------
Stockholders' Equity
Common stock, $.01 par value; authorized
7,000,000 shares; issued 2,829,733 28,298 28,298
Additional paid-in capital 13,643,829 13,632,425
Retained earnings (deficit) (9,858,930) (9,876,798)
------------ ------------
3,813,197 3,783,925
Less treasury stock, at cost, 307,250 shares 1,117,977 1,117,977
------------ ------------
2,695,220 2,665,948
------------ ------------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 4,047,149 $ 3,783,352
============ ============
</TABLE>
See Notes to Consolidated Financial Statements
-3-
<PAGE> 4
N-VIRO INTERNATIONAL CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Quarter Ended
March 31,
----------------------
1999 1998
--------- ---------
<S> <C> <C>
NET CASH PROVIDED BY OPERATING ACTIVITIES $ 102,765 $ 223,827
CASH FLOWS FROM INVESTING ACTIVITIES:
Expenditures for intangibles and other assets (171,390) (2,399)
Expenditures for property and equipment -- (1,436)
--------- ---------
NET CASH USED BY INVESTING ACTIVITIES (171,390) (3,835)
CASH FLOWS FROM FINANCING ACTIVITIES
Net repayments on revolving credit agreement -- (120,000)
Borrowings under long-term obligations 135,000 --
Repayments of long-term debt (29,692) (26,741)
--------- ---------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES 105,308 (146,741)
--------- ---------
NET INCREASE IN CASH 36,683 73,251
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 322,827 31,472
--------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 359,510 $ 104,723
========= =========
</TABLE>
See Notes to Consolidated Financial Statements
-4-
<PAGE> 5
N-VIRO INTERNATIONAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. ORGANIZATION AND BASIS OF PRESENTATION
The accompanying consolidated financial statements of N-Viro
International Corporation (the "Company") are unaudited but, in management's
opinion, reflect all adjustments (including only normal recurring accruals)
necessary to present fairly such information for the period and at the dates
indicated. The results of operations for the three months ended March 31, 1999
may not be indicative of the results of operations for the year ended December
31, 1999. Since the accompanying consolidated financial statements have been
prepared in accordance with Article 10 of Regulation S-X, they do not contain
all information and footnotes normally contained in annual consolidated
financial statements; accordingly, they should be read in conjunction with the
consolidated and combined financial statements and notes thereto appearing in
the Company's Form 10-K for the period ending December 31, 1998.
N-Viro International Corporation was incorporated in April 1993 and is
the successor to N-Viro Energy Systems, Ltd. (the "Partnership") and five
Company agents (the "Company Agents").
On October 19, 1993, the Partnership contributed to the Company all of
its assets (except certain marketable securities and accounts receivable from
certain related parties), subject to all liabilities (except certain retained
liabilities), and the shareholders of the Company Agents contributed to the
Company all of the outstanding capital stock of such entities in exchange for a
total of six million shares of Common Stock of the Company and organization
notes totaling $5,221,709 (such transactions are collectively referred to as the
"Organization"). The Organization notes were repaid out of the proceeds from an
initial public offering of two million shares of Company Common Stock. A total
of 2,112,000 new shares were issued in the initial public offering including
shares issued in the partial exercise by the Underwriters of an over-allotment
option.
The financial statements are consolidated as of March 31, 1999 and
December 31, 1998 for the Company. Adjustments have been made to eliminate all
intercompany transactions.
2. RELATED PARTY TRANSACTIONS
The Company recognized an expense to Mr. Bobby B. Carroll, a Director of
the Company and a former shareholder of Tennessee-Carolina N-Viro, Inc., of
$15,000 for the three months ended March 31, 1999, and $30,000 for the three
months ended March 31, 1998 under a contract arrangement signed in 1993 and
amended in 1998 for consulting services. The Company granted Mr. Carroll a
security interest in all present and future receivables and contract rights from
licenses in the states of Tennessee, North Carolina and South Carolina pursuant
to the contract agreement.
3. CONTINGENCIES
The Company leases office space under an agreement which requires
monthly payments of $4,812. The lease expires in December 2002. The total
minimum rental commitment at March 31, 1999 is $217,000. The total rental
expense included in the statements of operations for the periods ended March 31,
1999 and 1998 is approximately $14,435 and $14,000, respectively.
During 1994, the Company reacquired territory rights from a former
agent and issued 66,250 shares of unregistered common stock. The former
agreement stated that if the former agent elected to sell these shares, the
Company has guaranteed the former agent $6 per common share.
-5-
<PAGE> 6
In 1999 the Company reached a settlement agreement to modify its
royalty agreement with the former agent and the stock price guarantee agreement.
As part of this agreement, the former agent is required to pay royalties owed
and shall not sell any common stock issued in connection with the original
agreement until September 2000 at which time the former agent may sell up to
10,000 shares per month. The former agent has the right to offset future
royalties owing against the difference between the $6 per share guarantee and
the fair market value of the stock at the time the shares are sold.
The Company is involved in legal proceedings and subject to claims which
have arisen in the ordinary course of business. These actions, when concluded
and determined, will not, in the opinion of management, have a material adverse
effect upon the financial position of the Company.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
OVERVIEW
The Company was incorporated in April, 1993, and became a public company
on October 12, 1993. The Company's business strategy is to market the N-Viro
Process, which produces an "exceptional quality" sludge product as defined in
the Section 503 Sludge Regulations under the Clean Water Act of 1987, with
multiple commercial uses. To date, the Company's revenues primarily have been
derived from the licensing of the N-Viro Process to treat and recycle wastewater
sludge generated by municipal wastewater treatment plants and from the sale to
licensees of the alkaline admixture used in the N-Viro Process. The Company has
also operated N-Viro facilities for third parties on a start-up basis and
currently operates one N-Viro facility on a contract management basis.
Total revenues were $978,000 for the quarter ended March 31, 1999
compared to $1,032,000 for the same period of 1998. The net decrease in revenue
is due primarily to a decrease in territorial and site license revenue,
partially offset by an increase in facility management and research and
development revenue. The Company increased its cost of revenues for the same
period of 1999. The increase in cost of revenues was due primarily to the
increase in costs in generating facility management revenue. As a result, the
gross profit percentage decreased to 50% from 55% for the quarters ended March
31, 1999 and 1998. Selling, general and administrative costs decreased for the
comparative period, and losses in the equity of a joint venture increased for
the same period of 1999. These changes collectively resulted in net income of
$18,000 for the quarter ended March 31, 1999 compared to $68,000 for the quarter
ended March 31, 1998.
On June 1, 1998, the Company filed a registration statement on Form S-3
(the "Registration Statement") with the Securities and Exchange Commission for
the registration of certain shares of Common Stock of the Company then held by
Heartland Limited Partnership I ("Heartland"). These shares were subsequently
assigned to an affiliate of Heartland. The Company's audited financial
statements were not available as of the deadline for filing the Company's Form
10-K for the year ended December 31, 1998, and the Form 10-K was correspondingly
not filed in a timely manner. As a result of such untimely filing, the Company
may not currently use Form S-3 to register its shares of Common Stock, and the
Company is thus engaged in the process of withdrawing the Registration
Statement.
COMPARISON OF THREE MONTHS ENDED MARCH 31, 1999 WITH THREE MONTHS ENDED MARCH
31, 1998
Overall revenue decreased $54,000, or 5.2%, to $978,000 for the three
months ended March 31, 1999 from $1,032,000 for the three months ended March 31,
1998. The net decrease in revenue was due primarily to the following:
-6-
<PAGE> 7
a) Licensing of the N-Viro Process, including territory fees, earned the
Company $-0- for the quarter, a decrease of $150,000 from the same period in
1998;
b) The Company's processing revenue, including facility management
revenue, showed a net increase of $72,000 over the same period ended in 1998;
c) Research and development revenue increased $22,000 from the same
period ended in 1998;
d) Testing income increased $11,000 from the same period ended in 1998;
and,
e) Commission income decreased $9,000 from the same period ended March
31, 1998.
Gross profit decreased $77,000, or 13%, to $492,000 for the three months
ended March 31, 1999 from $569,000 for the three months ended March 31, 1998.
This decrease in gross profit was primarily a result of the decrease in
territory and license fee revenue, which have no associated cost of revenue, and
an increase in alkaline admixture and direct payroll costs in generating the
processing and facility management revenue. The gross profit margin decreased to
50% from 55% for the same three month comparison.
Selling, general and administrative expenses decreased $23,000, or 5%,
to $462,000 for the three months ended March 31, 1999 from $485,000 for the
three months ended March 31, 1998. The decrease was primarily due to a decrease
in administrative overhead and outside professional fees of $23,000.
As a result of the foregoing factors, the Company recorded operating
income of $30,000 for the three months ended March 31, 1999 compared to $84,000
for the three months ended March 31, 1998.
For the quarters ended March 31, 1999 and 1998, the Company has not
fully recognized the tax benefit of the losses incurred in prior periods.
Accordingly, the effective tax rate for each period was zero.
LIQUIDITY AND CAPITAL RESOURCES
The Company had working capital of $422,000 at March 31, 1999, compared
to working capital of $404,000 at December 31, 1998. Current assets at March 31,
1999 included cash and investments of $360,000, which is an increase of $37,000
from December 31, 1998. The increase in working capital was principally due to
the income from operations for the quarter.
In 1999 the Company's operating cash flow continued to be positive, and
the Company improved its payments to unsecured trade vendors. The Company
maintains a $250,000 certificate of deposit with a bank and held as collateral
on the Company's working capital line of credit.
In 1997 the Company obtained a working capital line of credit of
$200,000. In the third quarter of 1998 the line was increased to $500,000.
Borrowings against the line bear interest at prime minus .50% for amounts
borrowed up to $250,000, and prime plus 1% on the excess amount borrowed over
$250,000. This debt is collateralized by a certificate of deposit with the
lender of $250,000, accounts receivable, inventories and equipment, and are due
on demand. Also, the Company must maintain certain financial covenants. In
April, 1999, the bank waived a violation of a financial covenant in light of the
Company's net loss for the year ended December 31, 1998. In exchange, the
Company has agreed to not borrow more than $350,000 outstanding at any one time,
until further notice. The Company expects this borrowing limitation to be lifted
during the second quarter of 1999. The balance owed on the line of credit at
March 31, 1999 was $-0-.
-7-
<PAGE> 8
The Company believes that its working capital together with the line of
credit, will provide sufficient cash to meet the Company's cash requirements
through 1999.
SEGMENT INFORMATION
EARNINGS VARIATION DUE TO BUSINESS CYCLES AND SEASONAL FACTORS. Our
operating results can experience quarterly or annual variations due to business
cycles, seasonality and other factors. The market price for our common stock may
decrease if our operating results do not meet the expectations of the market.
Sales of the N-Viro technology are affected by general fluctuations in the
business cycles in the United States and worldwide, instability of economic
conditions and interest rates, as well as other factors. In addition, operating
results of some of our business segments are influenced, along with other
factors such as interest rates, by particular business cycles and seasonality.
COMPETITION. We compete against companies in a highly competitive
market and we have fewer resources than most of those companies. Our business
competes within and outside the United States principally on the basis of price,
product quality, custom design, technical support, reputation, equipment
financing assistance and reliability. Competitive pressures and other factors
could cause us to lose market share or could result in decreases in prices,
either of which could have a material adverse effect on our financial position
and results of operations.
RISKS OF DOING BUSINESS IN OTHER COUNTRIES. We conduct business in
markets outside the United States, and we expect to continue to do so. In
addition to the risk of currency fluctuations, the risks associated with
conducting business outside the United States include: social, political and
economic instability; slower payment of invoices; underdeveloped infrastructure;
underdeveloped legal systems; and nationalization. The Company has not entered
into any currency swap agreements which may reduce these risks. The Company may
enter into such agreements in the future if it is deemed necessary to do so.
The Company has determined that its reportable segments are those that
are based on the Company's method of internal reporting, which segregates its
business by product category and service lines. Fixed assets generating specific
revenue are identified with their respective segments as they are accounted for
as such in the internal accounting records. All other assets, including cash and
other current assets and all long-term assets, other than fixed assets, are
identified with the Corporate segment. The Company does not allocate any
selling, general, and administrative expenses to any specific segments. All of
the other income (expense) costs or income are non-apportionable and not
allocated to a specific segment. The Company accounts and analyzes the operating
data for its segments generally by geographic location, with the exception of
the Management segment, as this revenue accounts for over 10% of the total
revenue of the Company. This segment represents both a significant amount of
business generated as well as a specific location and unique type of revenue.
The other two segments are divided between domestic and foreign sources, as
these segments differ in terms of environment and municipal legal issues, nature
of the waste disposal infrastructure, political climate, and availability of
funds for investing in the Company's technology. These factors have not changed
significantly over the past two years and are not expected to do so in the near
term.
-8-
<PAGE> 9
The table below presents information about the segment profits and
segment identifiable assets used by the chief operating decision makers of the
Company for the quarters ended March 31, 1999 and 1998 (dollars in thousands).
<TABLE>
<CAPTION>
Management Domestic Foreign
Operations Operations Operations Total
-------------- -------------- ------------ -------------
1999
--------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues $ 420 $ 521 $ 37 $ 978
Cost of revenues 229 257 -0- 486
Segment profits 191 264 37 492
Identifiable assets 75 261 -0- 336
Depreciation 3 12 -0- 15
1998
---------------------------------------------------------
Revenues $ 353 $ 592 $ 87 $ 1,032
Cost of revenues 221 245 (3) 463
Segment profits 132 347 90 569
Identifiable assets 83 220 -0- 303
Depreciation 3 11 -0- 14
</TABLE>
A reconciliation of total segment revenues, cost of revenues, and segment
profits sales to consolidated revenues, cost of revenues, and segment
information to the consolidated financial statements for the quarters ended
March 31, 1999 and 1998 is as follows (dollars in thousands):
<TABLE>
<CAPTION>
1999 1998
------- -------
<S> <C> <C>
Revenues
Total revenues for reportable segments $ 978 $ 1,032
======= =======
Cost of revenues:
Total cost of revenues for reportable segments $ 486 $ 463
Other -0- -0-
------- -------
Consolidated cost of revenues $ 486 $ 463
======= =======
Segment profits:
Segment profits for reportable segments $ 492 $ 569
Corporate selling, general, and adminis-
trative expenses (462) (485)
Other income (expense) (12) (16)
------- -------
Consolidated EBIT $ 18 $ 68
======= =======
Depreciation and amortization:
Depreciation for reportable segments $ 15 $ 14
Corporate depreciation and amortization 29 25
------- -------
Consolidated depreciation $ 44 $ 39
======= =======
</TABLE>
-9-
<PAGE> 10
EFFECT OF YEAR 2000 ISSUE ON THE COMPANY'S MANAGEMENT AND INFORMATION SYSTEMS
The Company has prepared its systems and applications to operate
properly after the year 2000 (Y2K). The issue is whether computer systems will
properly recognize date-sensitive information when the year changes to 2000.
Systems that do not properly recognize such information could generate erroneous
data or cause a system to fail. The potential for failures and errors affects
all aspects of our business, including computers and their backup systems,
office equipment and building components. We are also addressing our
interdependencies with our customers and suppliers, all of whom must address the
same problem.
N-Viro's Y2K Program is focused on four inter-related categories which
are crucial to maintaining uninterrupted service to our customers: the Company
local area network (LAN) and wide-area network (WAN), software applications, and
the external hardware that supports the applications. Additionally, the Company
will include an assessment of its non-computer based equipment and office
infrastructure, which is less significant to serving the needs of the Company's
customers. The milestones within each category are: assessment, repair, testing
and approval. The Company has a target of September 30, 1999 for the completion
of all phases for all systems affecting the Company.
CURRENT STATUS
The Company has approximately 20 computers in use or available for use,
all connected via a LAN. Of these, all but four are run under Macintosh
operating systems, which do not have a Y2K problem. The other four are Windows
95 operating systems, and support the financial accounting and financial
administration of the Company. All are important to the administration and
maintenance related to our direct N-Viro product support activities, and support
our sales and marketing department and other company services and internal
administrative functions. As of March 31, 1999, the Company has completed 100%
of the assessment, 100% of the repair and 100% of the application testing. All
are Y2K compliant.
The Company WAN helps provide quality service to the Company's
customers. All of the boxes, switches, routers and network control points have
been assessed: 100% are Y2K compliant. Additional Y2K testing will be conducted
to independently verify supplier claims of compliance. At March 31, 1999, the
assessment of the supplier applications was 15% complete. The Company expects to
complete all phases of network certification by July 31, 1999.
With respect to customer and supplier (third party) assessment, letters
have been sent to about 400 companies to request information on their Y2K plans
and targets for compliance. The Company has identified no existing types of
third party interfaces. At March 31, 1999, the Company received approximately
13% of third party requests and approximately 100% of these indicated they were
or expected to be Y2K compliant. The Company expects to complete Y2K
certification for third parties by August 31, 1999, with 100% expected to be
complete by Fall 1999.
The non-information technology infrastructure focuses on the
utilities-based systems (e.g., electric) that support the computer systems, as
well as the need to continue security and operations. The effort to date for Y2K
compliance within the non-IT infrastructure is in inventory and assessment. At
March 31, 1999, approximately 25% of all sites completed inventory, 25%
completed assessment and 25% are Y2K compliant. The Company expects to complete
the remaining sites by mid-year 1999.
COSTS
The Company has expended approximately $7,000 since inception in late
1997 on the Y2K project. Total costs for the quarter ended March 31, 1999 were
$-0-. The Company anticipates the total cost of the project to be approximately
$10,000 through December of 1999, which includes approximately $7,000 of
capitalized fixed assets and $3,000 of additional assessment and compliance
costs.
-10-
<PAGE> 11
CONTINGENCY PLANS
The Company is in the process of establishing Y2K contingency plans,
which include the following:
- - Data retention and recovery procedures to be in place for customer and
business data to provide pre-millennium backups with on-site (primary
backup) and off-site (2nd backup) data copies.
- - Alternative processes to be developed to support all customer functions in
the event information systems or mechanical processes experience
disruptions.
- - Alternative suppliers and plans to be in place for third-party
products/services that do not meet Y2K compliance commitment schedules.
RISK ASSESSMENT
The Company has assessed our business exposure that would result from a
failure of our Y2K Program, as well as those of our suppliers and customers.
Such failures would result in business consequences that could include failure
to be able to serve customers, loss of network functionality, inability to
render accurate bills, lost revenue, harm to the Company trademark, legal
exposure and failure of management controls.
Although the Company believes that internal Y2K compliance will be
achieved by December 31, 1999, there can be no assurance that the Y2K problem
will not have a material adverse affect on the Company's business, financial
condition and results of operations.
The Company cautions that words used in this document such as
"expects," "anticipates," "believes," "may," and "optimistic," as well as
similar words and expressions used herein, identify and refer to statements
describing events that may or may not occur in the future. These forward-looking
statements and the matters to which they refer are subject to considerable
uncertainty that may cause actual results to be materially different from those
described herein. Some, but not all, of the factors that could cause actual
results to be different than those anticipated or predicted by the Company
include: (i) a deterioration in economic conditions in general; (ii) a decrease
in demand for the Company's products or services in particular; (iii) the
Company's loss of a key employee or employees; (iv) regulatory changes,
including changes in environmental regulations, that may have an adverse affect
on the demand for the Company's products or services; (v) increases in the
Company's operating expenses resulting from increased costs of labor and/or
consulting services; and (vi) a failure to collect upon or otherwise secure the
benefits of existing contractual commitments with third parties, including
customers of the Company.
-11-
<PAGE> 12
PART II - OTHER INFORMATION
Item 5. Other Information
(a) None.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
27 Financial Data Schedule
(b) Reports on Form 8-K:
A Form 8-K was filed on January 19, 1999, regarding the
employment agreements with J. Patrick Nicholson and
Terry J. Logan.
-12-
<PAGE> 13
N-VIRO INTERNATIONAL CORPORATION
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.
N-VIRO INTERNATIONAL CORPORATION
Date: May 14, 1999 /s/ J. Patrick Nicholson
---------------- -----------------------------------------------
J. Patrick Nicholson
Chairman, President and Chief Executive Officer
(Principal Executive Officer)
Date: May 14, 1999 /s/ James K. McHugh
---------------- ------------------------------------------
James K. McHugh
Chief Financial Officer
(Principal Financial & Accounting Officer)
-13-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q
FIRST QUARTER AND 1999 (3/31/99) AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000904896
<NAME> N-VIRO INTERNATIONAL CORP.
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 359,510
<SECURITIES> 1,740
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,603,776
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 4,047,149
<CURRENT-LIABILITIES> 1,181,900
<BONDS> 0
0
0
<COMMON> 28,298
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 4,047,149
<SALES> 0
<TOTAL-REVENUES> 978,124
<CGS> 0
<TOTAL-COSTS> 486,089
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 17,955
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 17,955
<EPS-PRIMARY> 0
<EPS-DILUTED> $.01
</TABLE>
