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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: December 31, 1998
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
Commission File Number: 0-24682
WORLDWIDE PETROMOLY, INC.
(Exact name of registrant as specified in its charter)
Colorado 84-1125214
(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
1300 Post Oak Boulevard, Suite 1985
Houston, Texas 77056
(Address of principal executive offices, including zip code)
(713) 892-5823
(Registrant's telephone number, including area code)
_________________
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes [x] No [
]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to
be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution
of securities under a plan confirmed by court. Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
At January 1, 1999, 17,347,500 shares of common stock, no par value, were
outstanding.
Transitional Small Business Disclosure Format (check one); Yes [ ] No [x]
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WORLDWIDE PETROMOLY, INC.
CONTENTS
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Page(s)
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets as of December 31, 1998
(unaudited) and June 30, 1998. . . . . . . . . . . . . . . . . . 3
Consolidated Statements of Operations for the three months
ended December 31, 1998 and 1997 ( both unaudited) . . . . . . . 4
Consolidated Statements of Cash Flows for the three months
ended December 31, 1998 and 1997 ( both unaudited) . . . . . . . 5
Notes to Consolidated Financial Statements . . . . . . . . . . . . 6 - 8
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations. . . . . . . . . . . . . . . . . . . . 8 - 11
PART II - OTHER INFORMATION
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Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . 12
(a) Exhibits
(b) Reports on Form 8-K
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
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2
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WORLDWIDE PETROMOLY, INC.
CONSOLIDATED BALANCE SHEETS
December 31, June 30,
1998 1998
-------------- ------------
(Unaudited)
<S> <C> <C>
ASSETS
- -----------------------------------------------------
Current Assets:
Cash and Cash Equivalents . . . . . . . . . . . . . . . $ 45,524 $ 34,375
Certificates of Deposit-Restricted. . . . . . . . . . . - 276,579
Accounts Receivable:
Trade . . . . . . . . . . . . . . . . . . . . . . . . 103,072 107,720
Affiliated Companies. . . . . . . . . . . . . . . . . 61,934 38,807
Notes Receivable-Related Parties. . . . . . . . . . . . 99,151 111,151
Inventories . . . . . . . . . . . . . . . . . . . . . . 60,003 45,394
Prepaid Expense and Other . . . . . . . . . . . . . . 28,469 10,840
-------------- ------------
Total Current Assets. . . . . . . . . . . . . . . . . . 398,153 624,866
-------------- ------------
Property and Equipment, Net (Note 3). . . . . . . . . . 114,412 121,419
-------------- ------------
Total Assets. . . . . . . . . . . . . . . . . . . . . . $ 512,565 $ 746,285
============== ============
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------------------------
Current Liabilities:
Accounts Payable and Accrued Expenses . . . . . . . . . $ 413,883 $ 173,592
Notes Payable . . . . . . . . . . . . . . . . . . . . . - 160,000
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Total Current Liabilities . . . . . . . . . . . . . . . 413,883 333,592
Advances From Stockholder . . . . . . . . . . . . . . . 400,636 116,263
-------------- ------------
Total Liabilities . . . . . . . . . . . . . . . . . . . 814,519 449,855
-------------- ------------
Stockholders' Equity:
Preferred stock, no par value, 10,000,000 shares
authorized, none issued . . . . . . . . . . . . . . . . -- --
Common stock, no par value, 800,000 shares
authorized; 17,347,500 issued and outstanding;
3,000,000 reserved for stock options. . . . . . . . . . 7,512,828 7,493,228
Accumulated Deficit . . . . . . . . . . . . . . . . . . (7,814,782) (7,196,798)
Total Stockholders' Equity. . . . . . . . . . . . . . . (301,954) 296,430
-------------- ------------
Total Liabilities and Stockholders' Equity. . . . . . . $ 512,565 $ 746,285
============== ============
</TABLE>
See accompanying notes to consolidated financial statements
3
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<TABLE>
<CAPTION>
WORLDWIDE PETROMOLY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended Six Months Ended
December 31, December 31,
1998 1997 1998 1997
------------ ------------ ------------ ------------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Net Sales . . . . . . . . . $ 139,610 $ 65,467 $ 192,746 $ 156,740
Cost of Sales . . . . . . . 92,338 52,114 129,460 117,277
------------ ------------ ------------ ------------
Gross Profit. . . . . . . . 47,272 13,353 63,286 39,463
Selling, Administrative
and General Expenses. . . . 214,173 534,540 950,598 673,225
------------ ------------ ------------ ------------
(Loss) From Operations. . . (166,901) (521,187) (523,150) (911,135)
Other Income, Net . . . . . -0- 35,812 -0- 38,921
------------ ------------ ------------ ------------
Net (Loss). . . . . . . . . $ (166,901) $ (485,375 (523,150) $ (872,214)
============ ============ ============ ============
Net (Loss) per Share. . . . $ (.01) $ (.03) $ (.03) $ (.05)
============ ============ ============ ============
Weighted Average Number of
Common Shares Outstanding . 17,347,500 16,747,500 17,347,500 16,747,500
============ ============ ============ ============
</TABLE>
See accompanying notes to consolidated financial statements
4
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<TABLE>
<CAPTION>
WORLDWIDE PETROMOLY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
Six Months Ended
December 31,
1998 1997
-------------- -----------
(Unaudited) (Unaudited)
<S> <C> <C>
Cash Flows from Operating Activities:
Net Loss. . . . . . . . . . . . . . . . . . . . . . $ (523,150) $ (872,214)
Adjustments to reconcile
Net Loss to Net Cash used in Operating Activities
Depreciation. . . . . . . . . . . . . . . . . . . . 12,283 11,000
Changes in Assets and Liabilities
Accounts Receivable . . . . . . . . . . . . . . . . (18,479) (3,010)
Inventories . . . . . . . . . . . . . . . . . . . . (14,609) 38,804
Prepaid Expense and Other Assets. . . . . . . . . . 17,629 (3,692)
Accounts Payable and Accrued Expenses . . . . . . . 110,209 (46,947)
-------------- -----------
Net Cash used in Operating Activities . . . . . . . . (416,117) (876,059)
-------------- -----------
Cash Flows from Investing Activities:
Certificates of Deposit . . . . . . . . . . . . . . 276,579 (23,940)
Capital Expenditures. . . . . . . . . . . . . . . . (5,286) (18,468)
Related Party Loan-Repayments . . . . . . . . . . . 12,000 141,726
-------------- -----------
Net Cash provided by Investing Activities . . . . . 283,293 99,318
Cash Flows from Financing Activities:
Proceeds from options exercised . . . . . . . . . . 19,600 --
Borrowing/repayment of shareholder loans. . . . . . . 284,373 (25,000)
Borrowing of Notes Payable. . . . . . . . . . . . . (160,000) 55,000
-------------- -----------
Net Cash provided by Financing Activities . . . . . 143,973 30,000
Net increase (decrease) in Cash and Cash Equivalents. 11,149 (746,741)
Cash and Cash Equivalents, Beginning of Period. . . . 34,375 864,555
-------------- -----------
Cash and Cash Equivalents, End of Period. . . . . . . $ 45,524 $ 117,814
============== ===========
</TABLE>
See accompanying notes to consolidated financial statements
5
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WORLDWIDE PETROMOLY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - ORGANIZATION AND BUSINESS
Worldwide PetroMoly, Inc. (the "Company"), a publicly-held Colorado
corporation, is engaged in the marketing and distribution of a line of engine
lubrication products under the tradename "PetroMoly". The Company was formed as
a result of a reverse merger on July 22, 1996, between Ogden, McDonald & Company
("Ogden McDonald" the former name of the Registrant with the Securities and
Exchange Commission) and Worldwide PetroMoly Corporation ("WPC"). Ogden McDonald
was incorporated in the state of Colorado on October 13,1989, and became a
public "shell" company for the purpose of engaging in selected mergers and
acquisitions. WPC was incorporated in the state of Texas on April 1, 1993, and
prior to the reverse acquisition, was engaged in the same line of business as
the Company. In connection with the reverse merger, Ogden McDonald acquired all
of the outstanding common stock of WPC, and subsequently changed its name to
Worldwide PetroMoly, Inc. WPC is now a wholly owned subsidiary of the Company.
The Company contracts with independent parties for the blending of its lubricant
products.
NOTE 2 - BASIS OF PRESENTATION
The accompanying unaudited financial statements of the Company and its
wholly-owned subsidiary WPC have been prepared in accordance with the
instructions and requirements of Form 10-QSB and, therefore, do not include all
information and footnotes necessary for a fair presentation of financial
position, results of operations, and cash flows in conformity with generally
accepted accounting principles. In the opinion of management, such financial
statements reflect all adjustments (consisting only of normal recurring
accruals) necessary for a fair presentation of the results of operations and
financial position for the interim periods presented. Operating results for the
interim periods are not necessarily indicative of the results that may be
expected for the full year. These financial statements should be read in
conjunction with the Company's annual report on Form 10-KSB.
NOTE 3 - PROPERTY AND EQUIPMENT
Property and equipment consists of the following as of December 31, 1998
and June 30, 1998:
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December 31 June 30
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Office furnishings and equipment $ 137,177 $134,536
Machinery and equipment. . . . . 16,370 13,735
Vehicles . . . . . . . . . . . . 12,062 12,062
------------- ---------
165,609 160,333
Less accumulated depreciation. . (51,197) (38,914)
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Net property and equipment . . . $ 114,412 $121,419
============= =========
</TABLE>
6
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WORLDWIDE PETROMOLY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 4 - INCOME TAXES
Deferred taxes are determined based on temporary differences between the
financial statement and income tax basis of assets and liabilities as measured
by the enacted tax rates which will be in effect when these differences reverse.
Deferred tax assets are comprised of the following at December 31, 1998:
Net operating loss carryforwards $ 2,006,000
Stock options granted to non-employees 567,000
Amortization expense 25,500
Bad debt expense 7,000
------------
Gross deferred tax asset 2,605,500
------------
Valuation allowance (2,605,500)
------------
Net deferred tax asset $ -
============
The Company has recorded a full valuation allowance against all deferred
tax assets because it could not determine whether it was more likely than not
that the deferred tax asset would be realized against future income.
At December 31, the Company had net operating loss carryforwards totaling
approximately $5,900,000 available to reduce future taxable income through the
year 2014 (see table).
The net operating loss carryforwards expire as follows:
<TABLE>
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Years ended December 31, Amount
----------------------------------- -----------
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2008 $ 70,000
2009 263,000
2010 112,000
Eighteen months ended June 30, 2012 2,753,000
Year ended June 30 2013 2,202,000
Year ended June 30, 2014 500,000
-----------
Total $ 5,900,000
===========
</TABLE>
7
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WORLDWIDE PETROMOLY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 5 - LOSS PER SHARE
Using the principles set forth in SFAS 128, basic earnings per share
includes no dilution and is computed by dividing income available to common
stockholders by the weighted average number of common shares outstanding for the
period. Dilutive earnings per share reflects the potential dilution of
securities that could share in the earnings of the company. The company was
required to adopt this standard in the second fiscal quarter of 1998. Using the
principles set forth in SFAS 128, basic and diluted earnings per share are
identical.
ITEM 2
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
RESULTS OF OPERATIONS -WORLDWIDE PETROMOLY INC. ("THE COMPANY")
The following discussion should be read in conjunction with the Company's
consolidated financial statements and related notes. See Consolidated Financial
Statements. Certain statements contained herein are not based on historical
facts, but are forward looking statements that are based upon assumptions about
future conditions that could prove not to be accurate. Actual events,
transaction and results may materially differ from the anticipated events,
transactions or results described in such statements. The Company's ability to
consummate such transactions and achieve such events or results is subject to
certain risks and uncertainties. Such risks and uncertainties include, but are
not limited to, the existence of demand for and acceptance of the Company's
products and services, regulatory approvals and developments, economic
conditions, the impact of competition and pricing, results of financing efforts
and other factors affecting the Company's business that are beyond the Company's
control. The Company undertakes no obligation and does not intend to update,
revise or otherwise publicly release the result of any revisions to these
forward-looking statements that may be made to reflect events or circumstances.
RESULTS OF OPERATIONS -GENERAL
During the fiscal quarter ended December 31, 1998 (also referred to as the
second fiscal quarter or the fourth calendar quarter), the Company invested in
Customer field product testing, additional research and development for new
products, printing retail sales brochures, purchasing lab equipment, and web
site modifications. The Company also did additional extensive field-testing in
an effort to expand the Company's industrial customer base, while continuing to
ascertain specific avenues and alliances for launching a retail campaign by
using an infomercial format that will feature the Company's additive lubricant.
In the past, the two areas of focus have been primarily the commercial and
industrial market, and secondarily the retail/passenger car market. The focus
has shifted this quarter to balance all markets. A specially formulated moly
racing-oil designed for NASCAR and INDY style motors is presently being tested
by world class INDY racecar drivers. These tests have shown significant
benefits to race engines, and the Company is presently negotiating a sponsorship
to promote company and brand awareness, as well as create a retail demand and
customer pull for the Company's products. Although on December 31, 1998, the
Company had not allocated a budget for Internet advertising, it had enjoyed a
number of web purchases with out advertising its web site. Because of this,
Management has begun to take action on exploiting the commerce activity that the
Internet can offer. Management believes that with a professional campaign the
Company will enjoy significant a sales volume increase.
During this quarter, the Company has added to and expanded the purchasing of its
customer base, including a co-generation power servicing company based in
Kansas, with the facility operated in Los Angeles. The Company also performed
more due diligence on the direct marketing infomercial format for its oil
additive called "PetroMoly Oil Treatment" and has determined that similar
products in this category have achieved tremendous success. Bringing a new
technology to a proven category, with what the Company believes to be a superior
product with an environmental impact, is expected to increase the Company's
revenues. Additionally, the infomercial format will also give the Company an
opportunity to educate the general public about its patent-approved lubrication
technology. The same technology for suspending and stabilizing molybdenum is
used in both PetroMoly Oil Treatment and PetroMoly. As The Company is now
entering the retail arena, this format can help build a demand for prospective
customers and increase sales for both products.
8
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QUARTER ENDED DECEMBER 31, 1998 COMPARED TO QUARTER ENDED DECEMBER 31, 1997
Total net sales for the quarter ended December 31, 1998, was $139,610 compared
to $65,467 for the quarter ended December 31, 1997, a 113% increase. This
increase by comparison is due to expanded purchasing of the Company's customer
base as well as new incentive programs designed to enhance higher volume orders.
Additionally, the positive change in cost of sales is also notable. Cost of
sales as a percentage of net sales decreased from 80% for the quarter ended
December 31, 1997, to 66% for the year ended December 31, 1998. This percentage
change resulted from improved agreements with suppliers, freight carriers and
toll blenders, along with continual streamlining procedures in manufacturing.
YEAR TO DATE ENDED DECEMBER 31, 1998 COMPARED TO YEAR TO DATE ENDED DECEMBER 31,
1997
Total net sales for the year to date ended December 31, 1998, was $192,746
compared to $156,740 for the year to date ended December 31, 1997, a 23%
increase. This increase by comparison is due to expanded purchasing of the
Company's customer base, as well as this quarter's incentive programs designed
to enhance higher volume orders. Additionally, the improvement in cost of sales
is also notable. Cost of sales as a percentage of net sales decreased from 75%
for the year to date ended December 31, 1997, to 66% for the year to date ended
December 31, 1998.
The Company is continuing its testing of various new products and interviewing
various vendors to see if the products can be made more cost effectively, thus
reducing the cost of sales in the future. Additionally, the projected increase
in sales volume will also reduce cost of sales due to economies of scale.
Management expects the following quarters to continue a greater trend that
reflects the retail campaign sales, along with the maturing marketing efforts,
scheduled to begin at the beginning of the 1999 calendar year. In the past, the
sales focus has been on securing commitments and endorsements from several large
national and multinational corporations that are considered leaders in their
various industries. As the analysis of the product utilization by these various
customers continues to be extremely positive and resolute, the sales volume and
relative margins remain low due to the promotional prices and practices allowed
by management. The Company expects sales volume to increase significantly during
in the first or second calendar quarter of 1999 as the promotional activities
and advertising campaigns come to fruition.
SELLING, GENERAL AND ADMINISTRATIVE
Selling, General and Administrative expenses decreased from $534,540 for the
quarter ended December 31, 1997, and for the year to date ended December 31,
1997 at $950,598 to $214,173 for the quarter ended December 31, 1998 and
$586,436 for the year to date ended December 31, 1998; a 149% and 62% decrease
respectively from quarter, to year to date accounting. The primary reason for
the decreases in expenses for the compared quarters and year to date endings
were the downsizing of the corporate structure, and relocating of the some of
the company's offices in both Houston and Florida. Management expects that next
quarter Selling, General and Administrative will continue to show the benefits
of the continued practices of expense cutting where ever possible, with out
sacrificing quality or the Company's image.
9
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LIQUIDITY AND CAPITAL RESOURCES
On December 31, 1998, the Company had booked a working capital of $(15,730),
compared to $291,274 at June 30,1998. The change in working capital was
primarily due to the booking of several large orders that were shipped out at
the very end of the quarter, and the suppliers' billings that totaled over
$93,000, associated with most of these sales and some inventory that is on
order. It was necessary to show these liabilities in order to accurately
reflect the cost of goods for this quarter. These customer orders have 30-day
net terms, and will show a significant change in working capital in January
1999. In addition to inventory orders included in the year end liabilities
there also are the normal general and administrative expenses, year end payroll
tax liabilities. Net cash used in Operating activities for yearly compared
quarters was $416,117 for ended December 31, 1998 a significant drop compared to
$876,059 for ended December 31, 1997, being a 110% decrease. From time to time,
the Company's Chairman, Gilbert Gertner, has loaned money and continues to
provide capital to the Company as needed. At this time there has not been a
formal agreement on how Mr. Gertner will be reimbursed and awarded for his
contribution, but it is understood that when the Company has the ability to pay
him back and award his support, it will do so; however, there are no demands for
repayment at this time.
Also, at December 31,1998, the Company possessed 150,000 warrants of Citadel
Technology Inc. that were awarded through a related party transaction in 1996.
These warrants were valued at $1.89 at year-end and have a strike price of
$0.59. As the Company has plans to liquidate these warrants, they can not be
added to the Company's balance sheet until they are exercised into shares.
Management expects to liquidate these warrants at a value well over $200,000.
At December 31, 1998, the Company had net operating loss carryforwards totaling
approximately $5,900,000 available to reduce future income through the year 2012
as described in note 4 to the consolidated financial statements.
Management has been reviewing various financial vehicles and the possibilities
for a capital infusion through equity or debt financing and will consummate an
agreement in January 1999, around the time of this filing. The Company may
consummate a series of financial arrangements in the next quarter for additional
expansion. Some structures that have been presented by outside parties are more
attractive than others, and Management wants to ensure that the chosen vehicle
is the most beneficial one for the Company's long and short term goals. These
goals consider the need for corporate developments through implementation of its
business plan as well as Shareholder benefits and market conditions. Assuming
the Company does not find agreeable financing in the foreseeable future, the
Company's significant operating losses and working capital deficit raise
substantial doubt about its ability to continue as a going concern. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
YEAR 2000 COMPLIANCE
Many currently installed computer systems and software products are coded to
accept only two digit entries in the date code field. These date code fields
will need to accept four digit entries to distinguish 21st century dates from
20th century dates. As a result, in less than one year, computer systems and/or
software used by many companies will need to be upgraded to comply with such
"Year 2000" requirements. Systems that do not properly recognize such
information could generate erroneous data or cause a system to fail. Significant
uncertainty exists in most industries concerning the potential effects
associated with such compliance. Management does not anticipate that the Company
will incur significant operating expenses or be required
10
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to invest heavily in computer systems improvements to be Year 2000 compliant.
Although the Company believes the software and hardware it utilizes for
operations comply with Year 2000 requirements, there can be no assurances that
the Company will not experience serious, unanticipated negative consequences
and/or material costs caused by undetected errors or defects in the technology
used in its internal systems. The occurrence of any of the foregoing could have
a material adverse effect on the Company's business, operating results or
financial condition. The Company has taken additional steps in sending out
questionnaires to its vendors and major customers concerning their respective
Year 2000 compliance status. So far all major accounts, both vendors and
customers have reported that they are all within acceptable areas, and they do
not anticipate any material adverse effect on the Company's on-going servicing
relationships. There can be no assurances that the Company will not experience
serious, unanticipated negative consequences and/or material costs caused by
undetected errors or defects in the technology used by its venders or customers.
OUTLOOK
In the year ended June 30 1998,the Company's strategic focus was on both
consummating relationships with a group of leaders in the industrial and retail
markets, which are known as opinion leaders of new technologies or have a high
visibility in the market. Management foresees the "testing periods" that the
Company has invested with these groups coming to a natural end during fiscal
1999, followed by significant revenue producing contracts, and testimonials that
will attract other companies in the similar industries for a greater market
share. Any one of the substantial customers that the Company is presently
working with is capable of increasing the volume production to a much greater
economies of scale. These savings will decrease cost of sales, and possibly
decrease the cost to the customers as well.
In 1998, the Company trademarked the name "molytech" that embodies the Company's
proprietary technology that the US patent office accepted and is ready to be
patented. Management is actively pursuing licensing agreements with major oil
companies to utilize molytech in their existing lines, where the Company would
receive royalty income with pre-negotiated minimum volumes.
At the time of this filing, The Company has recently consummated an agreement
with an Internet marketing company that has committed over $500,000 to Company,
in which $250,000 is reserved for a direct marketing campaign. Management is
extremely eager to begin marketing the newly developed oil additive, PetroMoly
Oil Treatment, which uses the same proprietary technology to suspend molybdenum
in motor oil for cars and light trucks. An advertising campaign is planned for
this particular product beginning with an infomercial to create consumer
awareness and educate the general public about the Company's new technology.
This exposure will possibly facilitate a demand for the other PetroMoly products
as well. During this campaign, distribution will be maintained through
fulfillment houses. Later a full-scale retail campaign is planned as the
product is sold in the auto after-market stores and retail chains. Reports to
management show this oil additive product, being a new technology in a proven
direct response category, is projected to carry an enormous demand.
With a proper financing in place, along with the progressing sales relationships
maturing and the new product lines being marketed, the Company expects operating
margins and revenues to improve appreciably during fiscal 1999.
11
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NEW ACCOUNTING PRONOUNCEMENTS
In June 1997, the Financial Accounting Standards Board issued two new disclosure
standards. Results of operations and financial position are unaffected by
implementation of these new standards.
Statement of Financial Accounting Standards (SFAS) 130, "Reporting Comprehensive
Income", establishes standards for reporting and display of comprehensive
income, its components and accumulated balances. Among other disclosures, SFAS
130 requires that all items that are required to be recognized under current
accounting as components of comprehensive income be reported in a financial
statement that is displayed with the same prominence as other financial
statements.
SFAS 131, "Disclosure about Segments of a Business Enterprise", establishes
standards for the way that public enterprises report information about operating
segments in annual financial statements and requires reporting of selected
information about operating segments in interim financial statements issued to
the public. It also establishes standards for disclosures regarding products
and services, geographic areas and major customers. The Company only operates in
one segment of business, the marketing and distribution of engine lubrication
products.
In February 1998, the Financial Accounting Standards Board issued SFAS No. 132,
Employers' Disclosures about Pensions and Other Postretirement Benefits, which
standardizes the disclosure requirements for pensions and other Postretirement
benefits. The adoption of SFAS No. 132 is not expected to impact the Company's
current disclosures.
In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
Accounting for Derivative Investments and Hedging Activities Income, which
requires the recording of all derivative instruments as assets or liabilities
measured at fair value. Among other disclosures, SFAS 133 requires that all
derivatives be recognized and measured at fair value regardless of the purpose
or intent of holding the derivative.
SFAS 133 is effective for financial statements for periods beginning after June
15, 1999. Because of the recent issuance of this standard, management has been
unable to evaluate fully the impact, if any, the standard will have on future
financial statements.
12
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PART II
OTHER INFORMATION
Item 6.
Exhibits and Reports on Form 8-K
(a) Exhibits -- Financial Data Schedule
(b) Reports on Form 8-K -- None
13
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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 hereunto duly authorized.
WORLDWIDE PETROMOLY, INC.
Date: February 16, 1999 By: /s/ Gilbert Gertner
-----------------------
Gilbert Gertner, Chairman, and Chief
Executive Officer
By: /s/ Lance Rosmarin
-------------------------
Lance Rosmarin, President, and Chief
Financial and Accounting Officer
14
<PAGE>
<TABLE> <S> <C>
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