U.S. 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 February 29, 1996
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______ to______
Commission file number 0-25702
AMWEST ENVIRONMENTAL GROUP, INC.
(Name of Small Business Issuer in its charter)
NEVADA 88-0289700
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
10701 LOS ALAMITOS BLVD.
LOS ALAMITOS, CA 90720
(Address of principal executive offices) Zip Code)
Issuer's Telephone Number: (310) 799-1888
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the 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
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date.
Transitional Small Business Disclosure Format (check one); Yes___ No_X_
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
See Part II, Item 6.
Item 2. Management's Discussion and Analysis
or Plan of Operation.
Analysis of Financial Condition and Results of Operation
The following table sets out the financial condition of the Registrant for each
of the last fiscal year and the period ended February 20, 1996:
February 29, August 31,
1996 1995
------------ ----------
Statement of Earnings:
Revenue ............................. $ 530,912 $ 1,500,375
Net Income (Loss) ............................ ($ 605,521) ($ 1,171,365)
Per Share Net Income (Loss) .................. ($ 0.03) ($ 0.07)
Number of Common Shares Outstanding .......... 18,215,913 16,599,038
Balance Sheet Data:
Total Assets ................................. $ 5,276,396 $ 545,515
Total Current Liabilities .................... $ 599,299 $ 631,217
Cash Dividends Declared per Common Share ..... $ 0 $ 0
Stockholders' Equity ......................... $ 4,394,061 $ 3,285,832
Net loss for the period ended February 29, 1996 was $605,521. Net loss for
the fiscal year ending August 31, 1995 was $1,171,365, up from the net loss of
$1,092,997 recorded in the fiscal year ended August 31, 1994. The primary
reasons for the loss during the fiscal year ended August 31, 1995 were heavy
one-time startup costs of the Registrant's subsidiaries. The
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<PAGE>
factors contributing to this loss are isolated events but may possibly occur
again in the next fiscal year.
The Registrant has experienced growth in terms of projects finished,
marketing activities, and future contracts. Continuing the activities from 1994,
the major areas of activities are in engineering, consultation, and
construction. The former includes property Phase I assessments, site Phase II
investigations, site Phase III remediations, solid wastes and wastewater
treatments. The latter includes underground storage tank (UST) removal and
installation, and construction of remediation facilities. The clients of Amwest
have been primarily in private industries. However, in this period, several
projects have been contracted with the public sector. This trend is anticipated
to continue, reaching a balance between the private and public sectors.
As of the second quarter of 1994 the Registrant had an accumulated volume
of contract completed or in progress of $2,909,081. During the most recent
fiscal year, ending the second calendar quarter of 1995, the Registrant
estimates that it procured an additional $1,643,094 in contracts bringing its
estimated volume on contracts, from inception, to $4,552,175.
Registrant has performed most of its engineering, consultation and
construction in Southern California. All projects of the Registrant have been
finished in a timely manner. The volume of work available to the Registrant and
other environmental companies in Southern California and the United States is
increasing. Management of the Registrant can not foresee change in this
condition in the near future. As a result of the aforesaid increase in available
work the Registrant should sustain its present growth for the short term (one
year) and possibly on a long term basis (more than one year).
The Registrant has entered into a joint venture with the city of Beijing,
China. The future of this contract is questionable as the Registrant has, as of
this date, been unable to locate sufficient financing. The existence of this
contract should not impact the regular operation of the Registrant.
During the last fiscal year the Registrant began operation of two of its
subsidiaries, Amwest Bluestar Corporation and Amwest Environmental Engineering
Corporation. The starting costs for these subsidiaries accounted for a
substantial part of the loss incurred by the Registrant. The Registrant
anticipates these subsidiaries, individually, will produce positive cash flow
during the next fiscal year. In addition to Bluestar and Engineering, the
Registrant incurred starting costs for three additional subsidiaries: Amwest
International Corporation, Amwest Manufacturing Corporation, and Amwest
Environmental Sciences Corporation. These subsidiaries are not presently
operating entities. Management presently cannot foresee whether these
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<PAGE>
entities may become profitable. The following chart lists the estimated startup
costs for each of the above named subsidiaries expended in the past fiscal year.
Name Estimated Startup Cost
Amwest Engineering Corporation $150,000.00
Amwest Bluestar Corporation $350,000.00
Amwest International Corporation $150,000.00
Amwest Environmental Sciences Corporation $100,000.00
Amwest Manufacturing Corporation $150,000.00
Plan of Operation
Management believes that the Registrant cannot satisfy its cash
requirements for the next twelve (12) months from its cash flow. In order to
satisfy the need for additional funds the Registrant intends to use its real
property as collateral for a line of credit. It is anticipated that this line of
credit along with funds generated from new and present contracts will be
sufficient to satisfy the financial needs of the Registrant during the next
fiscal year.
Presently the Registrant has several projects in the research and
development stage. These projects include a treatment for "oily sludge", a
process for the manufacturing of products from recycled rubber, and a cryogenic
process for the production of ultra-fine crumb rubber. Ultra-fine crumb rubber
can be used as the basis for most rubber products. As these projects are in
their initial stages, management cannot state with any certainty whether any
project will be completed or result in the generation of income.
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<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
The Company is not a party to any litigation and is not aware of any pending or
threatened litigation.
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.
None.
Item 6. Exhibits and Reports on Form 8-K.
Financial Statements of February 29, 1996......................F-1 through F-12.
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<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
AMWEST ENVIRONMENTAL GROUP, INC.
Date:__________________ _______________________________
(name and title)
Date:__________________ _______________________________
(name and title)
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