UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OF 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period September 30, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OF 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________ to ________________.
Commission file number 0-27240
-------
ECOTYRE TECHNOLOGIES, INC.
--------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
Delaware 11-3234026
-------- ----------
(State of other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
895 Waverly Avenue, Holtsville, New York 11742
---------------------------------------------
(Address of principal executive offices)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 of 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 [ ]
As of November 19, 1997, 3,492,430 shares of $.001 par value Common Stock of the
registrant were outstanding.
Index schedule found on Page No. 2
- 1 -
<PAGE>
ECOTYRE TECHNOLOGIES, INC.
-------------------------
INDEX
-----
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets - September 30, 1997 and March 31, 1997 3
Condensed Statements of Operations - Six Months and Three Months
Ended September 30, 1997 and 1996 4
Condensed Statements of Cash Flows - Six Months Ended September
30, 1997 and 1996 5
Notes to Condensed Financial Statements 6 - 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9 - 12
Part II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 13
SIGNATURES 14
</TABLE>
- 2 -
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
ECOTYRE TECHNOLOGIES, INC.
CONDENSED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
As of As of
September 30, 1997 March 31, 1997
(Unaudited)
------------------ --------------
<S> <C> <C>
ASSETS
Current:
Cash $ 30,853 $ 127,392
Account receivable net of allowance for
doubtful accounts of $17,000 1,379,679 958,798
Inventories 944,342 431,561
Prepaid expenses 446,281 241,087
Other current assets 106,203 120,999
---------- ----------
Total current assets 2,907,358 1,879,837
Property, plant and equipment, less accum depr. 2,342,561 2,295,089
Security deposits 232,420 244,815
Other assets 280,545 396,003
---------- ----------
$5,762,884 $4,815,744
LIABILITIES AND STOCKHOLDERS' EQUITY
Current:
Current maturities of long-term debt $ 74,223 $ 115,000
Accounts payable 1,188,867 1,003,386
Accrued expenses 230,495 149,687
Preferred stock dividends payable 60,139 120,277
Current maturities of capitalized leases 5,160 7,979
Current maturities of machinery loan 236,144 150,011
---------- ----------
Total current liabilities 1,795,028 1,546,340
Long-term debt, less current maturities 132,381 150,000
Capitalized leases, less current maturities - 16,711
Machinery loan, less current maturities 669,559 849,989
Deferred rent credits 319,799 313,169
---------- ----------
Total liabilities 2,916,767 2,876,209
---------- ----------
Class A Redeemable Convertible Preferred - 2,000,000 shares authorized;
issued and outstanding - 1,202,775 (redemption amount of
$1,202,775) 1,193,090
Stockholders' equity (Note 4):
Serial Preferred Stock, $.001 par value, 1,325,000 shares authorized;
none issued - -
Class A Preferred Stock, $.001 par value, 2,000,000 authorized;
494,000 issued and outstanding (liquidation value of $494,756) 494,756 -
Class B Preferred, $.001 par value, 675,000 shares authorized;
450,000 issued and outstanding (liquidation value $450,000) 450,000 0
Common Stock, $.001 par value 30,000,000 shares authorized;
issued and outstanding - 2,957,752 and 908,143 2,958 908
Paid in capital 10,532,577 7,852,407
Deficit (8,634,174) (7,106,870)
---------- ----------
$2,846,117 $ 746,445
---------- ----------
Total stockholder's equity $5,762,884 $4,815,744
========== ==========
<FN>
See accompanying notes to financial statements
</FN>
</TABLE>
- 3 -
<PAGE>
ECOTYRE TECHNOLOGIES, INC.
CONDENSED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
For the Six Months Ended For the Three Months Ended
September 30, September 30,
----------------------------- ---------------------------
1997 1996 1997 1996
---- ---- ---- ----
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
----------------------------- --------------------------
<S> <C> <C> <C> <C>
Net sales $2,137,237 $ 801,337 $1,015,976 $ 582,535
Cost of sales 2,212,851 1,688,378 1,108,661 1,047,724
---------- ---------- ---------- ----------
Gross (loss) (75,614) (887,041) (92,685) (465,189)
---------- ---------- ---------- ----------
Operating expenses:
Selling and shipping 367,610 312,251 205,270 142,559
General and administrative 575,590 570,987 290,999 287,918
---------- ---------- ---------- ----------
Total operating expenses 943,200 883,238 496,269 430,477
---------- ---------- ---------- ----------
Loss from Operations (1,018,814) (1,770,279) (588,954) (895,666)
---------- ---------- ---------- ----------
Other Expenses, income
Interest expense, net of
interest income 68,077 14,975 24,795 16,728
Loss on Marketable
Securities 93,783 - - -
----------- ------------ --------- ---------
Total Other Expenses 161,860 14,975 24,795 16,728
Loss Before Taxes (1,180,674) (1,785,254) (613,749) (912,394)
Income Taxes 10,355 3,197 (102) (552)
----------- ------------ --------- ---------
Net loss $(1,191,029) $ (1,788,451) $(613,647) $(911,842)
----------- ------------ ---------
Preferred stock dividends
(Note 3) 521,198 125,076 184,923 33,062
Net loss attributable to common
stockholders $(1,712,227) $ (1,913,527) $(798,570) $(944,904)
=========== ============ ========= =========
Net loss per share
(Notes 3 and 4) $ (1.09) $ (4.27) $ (0.37) $ (2.10)
=========== ============ ========= =========
<FN>
See accompanying notes to financial statements.
</FN>
</TABLE>
- 4 -
<PAGE>
ECOTYRE TECHNOLOGIES, INC.
CONDENSED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Six Months Ended
September 30,
--------------------------
1997 1996
--------------------------
<S> <C> <C>
Cash flows from operating expenses:
Net loss $(1,191,029) $(1,788,451)
Adjustments to reconcile net loss to net cash used
in operating activities:
Depreciation and amortization 103,330 109,570
Deferred rent 6,630 20,504
Loss on sale of marketable securities 93,783 -
Decrease (increase) in assets:
Accounts receivable (420,881) (132,625)
Inventory (512,781) (194,860)
Other assets (75,822) (51,766)
Increase (decrease) in liabilities:
Accounts payable 185,481 192,761
Accrued expenses 80,808 (25,631)
---------- ----------
Net cash used in operating activities: (1,730,481) (1,870,498)
---------- ----------
Cash flows from investing activities:
Proceeds from sale of marketable securities: 356,217 -
Capital expenditures - net (150,802) (550,895)
---------- ----------
Net cash provided by (used in) investing activities 205,415 (550,895)
---------- ----------
Cash flows from financing activities:
Proceeds from sale of capital stock 1,600,750 -
Repayment of working capital loan (58,396) -
Repayment of bank loan - (200,000)
Proceeds from bank loan - 396,333
Repayment of capitalized lease obligations and
equipment loans (113,827) (51,311)
Repayment of IPO expense 0 (1,600)
---------- ----------
Net cash provided by financing activities 1,428,527 143,422
---------- ----------
Net decrease in cash (96,539) (2,277,971)
Cash and cash equivalents, beginning of period 127,392 2,782,952
---------- ----------
Cash and cash equivalents, end of period $ 30,853 $ 504,981
========== ==========
<FN>
See accompanying notes to financial statements
</FN>
</TABLE>
- 5 -
<PAGE>
ECOTYRE TECHNOLOGIES, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
Note 1. Basis of Presentation
The accompanying unaudited condensed financial statements included herein have
been prepared in accordance with generally accepted accounting principles for
interim period reporting in conjunction with the instructions to Form 10-QSB.
Accordingly, these statements do not include all of the information required by
generally accepted accounting principles for annual financial statements, and
are subject to year-end adjustments. In the opinion of management, all known
adjustments (consisting of normal accruals and reserves) necessary to present
fairly the interim financial results for the period have been included. It is
suggested that these interim statements be read in conjunction with the
financial statements and related notes included in the Company's 10-KSB for the
year ended March 31, 1997.
The operating results for the six months ended September 30, 1997 are not
necessarily indicative of the results to be expected for the year ended March
31, 1998.
Note 2. Inventories
Inventories have been valued at the lower of cost or market. The components
of inventory at September 30, 1997 and March 31, 1997 consist of:
<TABLE>
<CAPTION>
September 30, March 31,
1997 1997
---------------------------------------
<S> <C> <C>
Raw materials $ 311,616 $ 252,221
Work in process 44,688 9,765
Finished goods 588,038 169,575
------------ --------------
$ 944,342 $ 431,561
============ ==============
</TABLE>
Note 3. Net Loss Per Share
Net loss per share is based on the weighted average number of Common Stock
outstanding during each period. Common Stock equivalents and other potentially
dilutive securities are antidilutive. Net loss has been adjusted for accretion
of preferred dividends. (See Note 4)
- 6 -
<PAGE>
ECOTYRE TECHNOLOGIES, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
(Continued)
Note 4. Private Placements
In July 1997, the Company completed a private placement of its common stock
which provided net proceeds of $1,037,250 by issuing 829,800 shares of its
common stock at a price of $1.25 per share.
On September 26, 1997, the Company commenced a private placement of its common
stock which provided net proceeds through September 1997 of $63,000 by issuing
42,000 shares of its common stock at a price of $1.50 per share. Subsequent to
September 30, 1997, the Company received an additional $500,000 by issuing
333,333 shares of its Common Stock in connection with this private placement.
Class A Redeemable Convertible Preferred Stock.
Effective April 17, 1997, the Certificate of Incorporation of the Company
was amended upon approval from its redeemable Convertible Preferred shareholders
to modify their existing stock. The redemption provision has been eliminated and
the conversion rate of Preferred Stock into Common Stock has been reduced. The
Class A Convertible Preferred Stock is now convertible by multiplying the number
of shares to be converted by the sum of $1.00 plus all accrued and unpaid
dividends divided by the lesser of $21.00 per share or 75% of the closing bid
price for a five day trading period immediately prior to the conversion date.
Commencing July 15, 1997, each holder of Class A Convertible Preferred Stock
shall be entitled to convert up to 25% of their shares per month. Through
September 30, 1997, 830,244 shares have been converted to Common Stock.
The discount in the conversion rate of the convertible preferred stock to
common is required to be reflected as additional dividends ratably over the
conversion period. Accordingly, the Company recorded accredited preferred stock
dividends related to this discount of $521,198 or ($.33) per share (attributable
to the common stockholders) for the six months ended September 30, 1997 and
$184,923 or ($.09) per share (attributable to the common stockholders) for
the three months ended September 30, 1997.
Class B Convertible Preferred Stock.
Effective April 17, 1997, the Certificate of Incorporation of the Company was
amended upon approval from its Board of Directors to authorize 675,000 shares of
Class B Convertible Preferred Stock, with a par value of $.001 per share
(liquidation preference $1.00 per share; cumulative dividend of 10%).
In April 1997, a principal stockholder of the Company purchased 450,000 shares
of Class B Convertible Preferred Stock for $450,000. Such preferred stock is
convertible into common stock by multiplying the number of shares to be
converted by the sum of $1.00 plus all accrued unpaid dividends divided by $2.45
per share. The holder of the Class B Convertible Preferred Stock has agreed not
to convert or sell said stock until May 22, 1998.
Reverse Stock Split.
On June 2, 1997, the Company, with the approval of its shareholders,
effectuated a one-for-seven reverse stock split. All share and per share
information in the financial statements reflects the effects of the reverse
stock split.
- 7 -
<PAGE>
Note 5. Income Taxes
Income taxes are based on annualized statutory federal and state income tax
rates. The provision for income taxes exclude a benefit for net operating loss
carryforwards.
Note 6. Supplemental Cash Flow Information
Non-cash investing and financing activities during the three months period
ending September 30, 1997 was as follows:
<TABLE>
<S> <C>
Exchange of Class A Convertible
Preferred shares for Common Stock $ 830,244
</TABLE>
- 8 -
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operation
General
The Company operated as a wholesale distributor of remolded automobile tires
since its inception in April 1993. In accordance with its business plan, the
Company has substantially curtailed distribution operations, concentrating its
efforts on its manufacturing operations. In its distribution operations, the
Company resold its products primarily to retail tire replacement centers and
tire distributors.
The Company commenced limited manufacturing operations in December 1995 at its
65,000 square foot leased facility in Holtsville, New York. See "Properties". To
commence manufacturing, the Company had purchased 20 mold presses, molds, one
extruder, one buffing machine and related ancillary equipment. Additional
equipment was purchased in 1996 to increase the Company's production capacity
and limit down time due to machinery failures and maintenance. The Company
ordered new molds from Italy in November 1996 to be utilized in its current
presses which should allow the Company to increase its production of popular
high performance and light truck tires with anticipated higher profit margins,
decreasing its production of smaller tire sizes which are sold at lower margins.
The molds have arrived at the Company's facility and have been placed in
production. Also, in March 1997, the Company acquired certain of the assets of
Butler Retreading, Inc., a private 18 year old high performance retreading
Company based in Marietta, Georgia. Butler's equipment is expected to increase
the Company's present press capacity and position the Company to increase sales,
with intended higher gross profit margins from the new mix of tires it will
produce. The asset acquisition, which includes Butler's client base, machinery,
equipment and inventory, was financed principally by the proceeds of a
$1,000,000 loan from PhoenixCor. Inc., a wholly owned subsidiary of Sumitoma
Bank.
On October 22, 1997, the Company entered into an Acquisition Agreement with Tire
Group International, Inc. ("TGI"), a wholesale tire distributor. The closing of
this transaction is subject to Board of Directors approval and the securing of
necessary financing.
- 9 -
<PAGE>
Results of Operations
Six Months Ended September 30, 1997 Compared to Six Months Ended September 30,
1996.
Net Sales. The Company's net sales of $2,137,237 for the six months ended
September 30, 1997 represent an increase of $1,335,900 compared to net sales for
the six months ended September 30, 1996. The increase is attributable to the
Company's operations of its manufacturing facility for the entire six months
ending September 30, 1997 as compared to limited operations during the six
months ending September 30, 1996.
Cost of Sales. The Company's cost of sales for the six months ended
September 30, 1997 was $2,212,851 as compared to $1,688,378, representing an
increase of $524,473. This increase was due primarily as a result of increased
manufacturing costs to support the increase in sales. During the six months
ended September 30, 1996, the Company was primarily in its initial stages of
manufacturing, operating at an average plant capacity of 20%. The Company
believes that its gross margin will continue to improve with increased sales.
Gross Loss. The Company's gross loss for the six months ended September 30,
1997 was ($75,614) as compared to a gross loss of ($887,041) for the six months
ended September 30, 1996. The decrease in gross loss is directly related to the
Company operating its facility at a higher percentage of capacity during the six
months ended September 30, 1997 than during the six month period ended September
30, 1996.
Operating Expenses. The Company incurred selling, shipping, general and
administrative expenses of $943,200 in the six months ended September 30, 1997
as compared to $883,238 in the six months ended September 30, 1996. Such
expenses represent 44% and 110% of net sales for the six months ended September
30, 1997 and September 30, 1996, respectively. The decline of such expenses as a
percentage of sales represents the Company's continuing efforts to contain such
expenses as it expands its operations. The increase of selling and shipping
expenses is a result of the increased sales and the additional selling costs
incurred therein.
- 10 -
<PAGE>
Other Expenses. The Company incurred net interest expense of $68,077 for the
six months ended September 30, 1997 compared to net interest expense of $14,795
for the six months ended September 30, 1996. The increase in interest expense
for the six months ending September 30, 1997 is the result of the borrowing
principally related to the machinery loan.
Net Loss. As a result of the foregoing factors, the Company's net loss
decreased from ($1,788,451) for the six months ended September 30, 1996 to a net
loss of ($1,191,029) for the six months ended September 30, 1997. The net loss
attributable to common stockholders decreased from ($1,913,527) or $4.27 per
share (adjusted for reverse split) to ($1,712,227) or $(1.09) per share. As
further explained in Note 4, the principal component of the increase in the
preferred stock dividends relates to preferred dividends accredited of $521,198.
Three Months Ended September 30, 1997 Compared to Three Months Ended September
30, 1996.
Net Sales. The Company's net sales of $1,015,976 for the three months ended
September 30, 1997 represents an increase of $433,441 compared to net sales for
the three months ended September 30, 1996. The increase was attributable to the
Company's operations of its manufacturing facility for the entire three months
ending September 30, 1997 as compared to limited operations during the three
months ended September 30, 1996.
Cost of Sales. The Company's cost of sales for the three months ended
September 30, 1997 was $1,108,661 as compared to $1,047,724, representing an
increase of $60,937. This increase was due primarily to increased purchases of
raw materials required as the result of increased sales. The Company believes
that its gross margin will continue to improve with increased sales.
Gross Loss. The Company's gross loss for the three months ended September 30,
1997 was ($92,685) as compared to a gross loss of ($465,189) for the three
months ended September 30, 1996, a decrease of ($372,504). The decrease in gross
loss is directly related to the Company operating its facility at a higher
percentage of capacity during the three months ended September 30, 1997 than
during the three months ended September 30, 1996.
Operating and Other Expenses. The Company incurred selling, shipping, general
and administrative expenses of $496,269, and net interest expense of $24,795 in
the three months ended September 30, 1997 as compared to $430,477 of selling,
shipping, general and administrative expenses and $16,728 of net interest
expense in the three months ended September 30, 1996. The increase in selling,
shipping, general and administrative expenses were attributable primarily to an
increase in costs related to the increase in sales during the three months ended
September 30, 1997. The interest expenses is primarily due to the Company's
higher outstanding borrowing principally related to the machinery loan.
Net Loss. The Company sustained a net loss of ($613,647) in the three months
ended September 30, 1997 as compared to a net loss of ($911,842) in the three
months ended September 30, 1996, a decreased loss of $298,195. The net loss
attributable to common stockholders decreased from ($944,904) or ($2.10) per
share (adjusted for reverse split) to ($798,570) or ($.37) per share.
Liquidity and Capital Resources
As indicated in the Company's annual report on Form 10-KSB, the Company's
financial statements have been prepared assuming that the Company will continue
operating as a going concern. The Company has sustained losses since inception
and requires additional working capital. These factors raise substantial doubt
about the Company's ability to continue as a going concern. The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
- 11 -
<PAGE>
The Company used cash in operating activities in the amount of $1,730,481 for
the six months ended September 30, 1997 and $1,870,498 for the six months ended
September 30, 1996 which was primarily related to the loss from operations. The
Company purchased machinery and equipment in the amounts of $254,132 and
$128,656 for the six months ending September 30, 1997 and 1996, respectively.
Financing provided to fund operating activities and fixed asset purchases for
the six months ended September 30, 1997 was provided by the proceeds from a
private placement of common stock of $1,600,750 and proceeds from the sale of
marketable securities of $356,217. Operating and investing activities for the
six months ended September 30, 1996 were funded from a bank line of credit of
$396,333.
Accounts Receivable - At September 30, 1997, the net account receivable
balance was $1,379,679, an increase of $420,881. The increase is due to the
additional sales realized during the six month period ended September 30, 1997.
Payment terms range from cash payment to various net terms in accordance with
industry practice. During the current fiscal year, the Company has not incurred
any significant write-offs.
On March 21, 1997, the Company acquired certain assets of Butler Retreading,
Inc. The aggregate purchase price was approximately $939,000 consisting of
$750,000 in cash provided by long term financing and 42,857 shares of common
stock of the Company valued at $189,000, or $4.41 per share, the quoted market
price of the Company's shares as of March 21, 1997. During September, 1997, the
Company received and installed substantially all equipment purchased from
Butler.
In connection with the acquisition, the Company entered into a new loan
agreement with PhoenixCor, Inc., a wholly owned subsidiary of Sumitoma Bank.
PhoenixCor, Inc. assumed the balance of the previous loan in the amount of
$139,589 and provided financing in the amount of $860,411, for a total new loan
of $1,000,000. The loan is payable in 3 monthly installments of $11,205 from
April 1997 through June 1997, 3 monthly installments of $19,609 from July 1997
through September 1997 and 42 monthly installments of $28,012 thereafter,
including interest at 11.4% per annum. PhoenixCor, Inc. has a security interest
in all of the Company's equipment.
The Company has entered into a 10-year, 9-month lease with one five year
renewal option for approximately 65,000 square feet of manufacturing, warehouse
and office space in Holtsville, New York during fiscal 1995, which provides for
minimum annual rental obligations of approximately $282,750, plus utilities and
maintenance, subject to 5% annual increases. As long as the Company is in
substantial compliance with its obligations under this Lease, it has an option
to purchase these premises for $2,500,000. If this option has not been exercised
by October 1, 1997, the purchase price will increase by 5% of that date and on
each anniversary thereof up to and including October 1, 2004. If the Company
elects to purchase these premises, it will be required to tender a deposit equal
to 10% of the purchase price and consummate the purchase within sixty (60) days
thereafter, whereupon the balance of the purchase price will be due. This option
may be exercised at any time up to July 31, 2005. The Company is utilizing this
facility for its manufacturing operations, as well as for warehousing its
inventory and as its corporate offices. The Company's capital requirements may
change depending upon numerous factors and the Company may require additional
financing from time to time, particularly in order to effectuate expansion
activities, if any. As of September 30, 1997, the Company has no significant
commitments for additional capital expenditures, nor has the Company exercised
the purchase option.
At September 30, 1997, the Company had cash and cash equivalents of $30,853
and working capital of $1,112,330. As further discussed in Note 4, through
September 30, 1997, the Company raised approximately $1,600,750 from the private
placement of common stock and has effectuated an amendment to its Class A
Convertible Preferred stock removing the requirement to pay approximately
$1,325,000 on January 15, 1998. The Company believes that it will be required to
raise additional working capital to meet its continuing obligations. If the
Company is unsuccessful in achieving positive cash flow from its operations or
generating additional working capital, the Company's business will be materially
and adversely affected.
- 12 -
<PAGE>
Seasonality
While there is a year-round demand for automobile tires, automobile tire sales
in the Northeastern United States are generally strongest during the second and
third calendar quarters of the year. Seasonality may have an impact on the
Company's operations including cash flow, insofar as the Company is required to
control inventory levels to reflect projected quarterly sales. However, since
the Company anticipates that approximately 50% of its sales will be in the
Western United States and other regions where all purpose automobile tires are
used year round, it does not believe that seasonality will have a material
adverse impact on its operations.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of
1995: The statements which are not historical facts contained in this report are
forward-looking statements that involve certain risks and uncertainties
including but not limited to, risks associated with the uncertainty of future
financial results, additional financing requirements, development of new
products, regulatory approval processes, the impact of competitive products or
pricing, unpredictability of patent protection, technological changes, the
effect of economic conditions and other uncertainties detailed in the Company's
filings with the Securities and Exchange Commission.
- 13 -
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits
---------
27 - Financial Data Schedule (for electronic submission only)
(b) Reports on Form 8-K
-------------------
None
- 14-
<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 : November 19, 1997 ECOTYRE TECHNOLOGIES, INC.
--------------------------
(Registrant)
By: /s/ Vito F. Alongi
-----------------------
Vito F. Alongi,
President, Treasurer and Principal
Financial Officer
- 15-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements for the six months ended September 30, 1997 and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-END> SEP-30-1997
<CASH> 30,853
<SECURITIES> 0
<RECEIVABLES> 1,379,679
<ALLOWANCES> 17,000
<INVENTORY> 944,342
<CURRENT-ASSETS> 2,907,358
<PP&E> 2,342,561
<DEPRECIATION> 103,330
<TOTAL-ASSETS> 5,762,884
<CURRENT-LIABILITIES> 1,795,028
<BONDS> 0
944,756
0
<COMMON> 2,958
<OTHER-SE> 1,898,403
<TOTAL-LIABILITY-AND-EQUITY> 5,762,884
<SALES> 2,137,237
<TOTAL-REVENUES> 2,137,237
<CGS> 2,212,851
<TOTAL-COSTS> 2,212,851
<OTHER-EXPENSES> 161,860
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 68,077
<INCOME-PRETAX> (1,180,674)
<INCOME-TAX> 10,355
<INCOME-CONTINUING> (1,191,029)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,527,304)
<EPS-PRIMARY> (0.97)
<EPS-DILUTED> (0.97)
</TABLE>
