SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter July 30, 1994 Commission File no. 1-6914
SUN CITY INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 59-0950777
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5545 N.W. 35 Ave. Fort Lauderdale, FL 33309
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (305) 730-3333
Same Name; Former Address-8600 Doral Blvd., #304, Miami, FL 33166
Former name, former address and former fiscal year, if changed
since last report.
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 such filing
requirements for the past 90 days.
Yes X No_____
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FINANCIAL INFORMATION
The consolidated financial statements included herein have been
prepared by the Company, without audit, according to the rules and
regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted
accounting principles have been omitted pursuant to such rules and
regulations. The financial statements reflect, in the opinion of
management, all adjustments (which include only normal recurring
adjustments) necessary to present fairly the financial position and
results of operations as of and for the periods indicated. The
statements should be read in conjunction with the financial
statements and the notes thereto included in the Company's Annual
Report on Form 10-K for the year ended January 29, 1994.
The results of operations for the six-month period ended July 30,
1994, are not necessarily indicative of results to be expected for
the entire year ending January 28, 1995.
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SUN CITY INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<CAPTION>
ASSETS July 30, 1994 January 29,1994
<S> <C> <C>
CURRENT ASSETS:
Cash and equivalents $ 550,981 $ 531,608
Accounts and trade notes receivable, less allowance for doubtful
accounts-$195,000 and $178,800, respectively 4,685,680 6,285,576
Inventories 2,059,116 2,345,759
Notes receivable - current portion 12,951 12,384
Prepaid expenses 485,768 367,771
Investment in joint ventures 864,000 670,000
Total Current Assets 8,658,496 10,213,098
Property, Plant and Equipment:
Land and improvements 159,058 150,072
Buildings and improvements 950,405 880,495
Machinery and equipment 4,268,768 4,082,595
5,378,231 5,113,162
Less accumulated depreciation 3,459,035 3,228,898
1,919,196 1,884,264
Properties held for sale 415,740 470,000
Long Term Notes Receivable 127,672 134,292
Excess of Purchase Price Over Fair Market Value of Net Assets 434,987 450,053
Other Assets 1,246,337 859,537
Total $12,802,428 $14,011,244
LIABILITIES AND STOCKHOLDERS' EQUITY July 30, 1994 January 29, 1994
CURRENT LIABILITIES:
Accounts payable $ 2,140,029 $4,118,900
Accrued expenses 1,074,581 507,714
Current portion of long-term debt 568,992 551,667
Income Taxes Payable 7,290 16,000
Total Current Liabilities 3,790,892 5,194,281
Deferred Compensation Payable 386,960 329,760
Long-Term Debt 5,311,719 5,400,235
Stockholders' Equity:
Preferred stock, no par value; authorized 300,000 shares; issued - none
Common stock, $.10 par value; 3,000,000 shares authorized:
2,276,116 shares issued, respectively 227,612 227,612
Capital in excess of par value 1,070,286 1,070,286
Retained earnings 5,025,179 4,852,290
6,323,077 6,150,188
Less, Treasury Stock at cost 840,414 shares (2,692,220) (2,692,220)
Loan Receivable for Common Stock sold to ESOP (318,000) (371,000)
3,312,857 3,086,968
TOTAL $12,802,428 $14,011,244
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SUN CITY INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<CAPTION>
Six Months Ended Three Months Ended
July 30, July 31, July 30, July 31,
1994 1993 1994 1993
<S> <C> <C> <C> <C>
Sales $35,020,582 $31,857,710 $15,349,194 $14,532,293
Costs and Expenses
Costs of sales 32,141,426 29,722,758 13,940,866 13,525,707
Selling, general and administrative expenses 2,427,943 1,838,355 1,173,205 856,243
Interest expense 286,794 196,816 152,337 101,510
Other (income), net (15,760) (29,376) ( 6,595) (16,551)
Total Costs and Expenses 34,840,403 31,728,553 15,259,813 14,466,909
Earnings Before Income Taxes $ 180,179 $ 129,157 $ 89,381 $ 65,384
Provision For Income Taxes 7,290 14,000 3,140 7,000
Net Earnings $ 172,889 $ 115,157 $ 86,241 $ 58,384
Earnings Per Common And Common Equivalent Share $ .12 $ .08 $ .06 $ .04
Earnings Per Common Share Assuming Full Dilution $ .11 $ .08 $ .06 $ .04
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SUN CITY INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
Six Months Ended
<S> <C> <C>
July 30, July 31,
1994 1993
Cash Flows From Operating Activities:
Net Earnings $ 172,889 $ 115,157
Adjustments To Reconcile Net Earnings
To Net Cash Provided By Or (Used In)
Operating Activities:
Depreciation 240,137 210,486
Amortization of excess of purchase price
over fair market value of net assets
acquired 15,066 744
Provision for losses on accounts
receivable 81,307 69,056
Change In Assets And Liabilities:
Decrease (increase) in accounts and
trade notes receivables 1,524,642 (239,924)
Decrease (increase) in inventory 286,643 (90,605)
(Increase) in prepaid expenses (117,997) (231,530)
(Increase) in investment in joint ventures (194,000) (362,000)
(Increase) in other assets (386,800) (46,531)
(Decrease) in accounts payable (1,978,871) (463,301)
Increase in accrued expenses 566,867 252,088
(Decrease) in income taxes payable ( 8,710) (26,412)
Increase in deferred compensation payable 57,200 60,002
Total Adjustments 85,484 (867,927)
Net Cash Provided By Or (Used In)
Operating Activities $ 258,373 $(752,770)
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SUN CITY INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Continued)
<CAPTION>
Six Months Ended
<S> <C> <C>
July 30, July 31,
1994 1993
Net Cash Provided By Or (Used In)
Operating Activities $ 258,373 $(752,770)
Cash Flow From Investing Activities:
Capital expenditures (220,809) (145,125)
Net Cash (Used In) Investing Activities: (220,809) (145,125)
Cash Flows From Financing Activities:
Principal payments on Long-term Debt (803,935) (529,777)
Proceeds from Long-term Debt 732,744 1,229,400
Proceeds from loan to ESOP 53,000 53,000
Net Cash (Used In) Or Provided By
Financing Activities (18,191) 752,623
Net Increase (decrease) In Cash
And Equivalents 19,373 (145,272)
Cash And Equivalents, Beginning of year 531,608 616,524
Cash And Equivalents, End of Year $ 550,981 $ 471,252
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<CAPTIONS>
Sun City Industries, Inc. and Subsidiaries
RESULTS OF OPERATIONS
During the six months ended July 30, 1994 sales revenues increased $3.2 million or 9.9% to $35,020,582 versus
$31,857,710 reported for the like period a year ago. Sales rose $5,846,754, an increase of 37.7% in the
foodservice division, while sales in the egg division decreased $2,638,475 or 16.3% to $ 13,519,237. The
decrease in egg division sales results primarily from a 9.1% reduction in egg market prices.
%Increase
Division Sales 1994 1993 (Decrease)
Foodservice $21,361,007 $15,514,253 37.7%
Eggs 13,519,237 16,157,712 (16.3%)
Other 140,338 185,745 (24.4%)
----------- ----------- ---------
$35,020,582 $31,857,710 9.9%
=========== =========== =========
Sun City's six months earnings jumped 50.1% to $172,889 or $.12 per share versus $115,157 or $.08 per share for
the six month period a year ago. Earnings for the second quarter improved 47.7% to $86,241 or $.06 per share
compared to $58,384 or $.04 per share reported for the same quarter last year.
The company's solid second quarter was led by a sharp improvement in the egg division's operating profits as
compared to a relatively weaker first quarter. The foodservice division also continued its significant
improvement in its operating results. Overall, profit from operations jumped 43% to $466,293, up $140,320 from
a year earlier.
To help fund the company's growth, borrowings have increased over the prior year and when coupled with higher
interest rates, interest expense rose from $196,816 to $286,114 for the first half of the fiscal year.
OTHER DISCLOSURES:
INCOME TAXES
Effective February 1, 1993, the Company adopted Statement of Financial Accounting Standards No. 109 (SFAS109)
"Accounting for Income Taxes" which supersedes Statement of Financial Accounting Standards No. 96 "Accounting
for Income Taxes". Statement No. 109 requires the recognition of deferred tax assets and liabilities based on
differences between financial reporting and tax bases of assets and liabilities measured using enacted tax rates
and laws that will be in effect when the differences are expected to reverse. The adoption of Statement No.
109 had no impact on the Company's financial statements.
SALES OF UNREGISTERED SECURITIES (DEBT OR EQUITY)
On March 18,1994 the Company completed a private placement offering by raising $700,000 in five year Senior
Subordinated Convertible Debentures carrying a fixed rate of 8%. The debentures are convertible in common stock
at $3.25 per share.
<\CAPTIONS>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM SUN CITY INDUSTRIES, INC. FINANCIAL STATEMENTS F.P.E 07-30-94
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
Item Number Item Description
5-02(1) Cash and cash items 550,981
5-02(2) Marketable securities -0-
5-02(3)(a)(1) Notes and accounts receivable-trade 4,893,631
5-02(4) Allowances for doubtful accounts 195,000
5-02(6) Inventory 2,059,116
5-02(9) Total current assets 8,658,496
5-02(13) Property, plant and equipment 5,378,231
5-02(14) Accumulated depreciation 3,459,035
5-02(18) Total asset 12,802,428
5-02(21) Total current liabilities 3,790,892
5-02(22) Bonds, mortgages and similar debt 5,311,790
5-02(28) Preferred stock mandatory redemption -0-
5-02(29) Preferred stock-no mandatory redemption -0-
5-02(30) Common stock 227,612
5-02(31) Other stockholders' equity 3,085,245
5-02(32) Total liabilities and stockholders' equity 12,802,428
5-02(b)1(a) Net sales of tangible products 35,020,582
5-03(b)1 Total revenues 35,020,582
5-03(b)2(a) Cost of tangible goods sold 32,141,426
5-03(b)2 Total costs and expenses applicable to sales and revenue 34,840,403
5-03(b)3 Other costs and expenses 2,698,977
5-03(b)5 Provision for doubtful accounts and notes 81,307
5-03(b)(8) Interest and amortization of debt discount 286,794
5-03(b)(10) Income before taxes and other items 180,179
5-03(b)(11) Income tax expense 7,290
5-03(b)(14) Income/loss continuing operations 172,889
5-03(b)(15) Discontinued operations -0-
5-03(b)(17) Extraordinary items -0-
5-03(b)(18) Cumulative effect-changes in accounting principles -0-
5-03(b)(19) Net income or loss 172,889
5-03(b)(20) Earnings per share-primary .12
5-03(b)(20) Earnings per share-fully diluted .11
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.
SUN CITY INDUSTRIES, INC.
REGISTRANT
DATE: Sept 13, 1994 Malvin Avchen
Malvin Avchen, C.E.O.
DATE: Sept 13, 1994 Syed Jafri
Syed Jafri, Treasurer
The financial statements for the six months ended July 30, 1994 and July
31, 1993, respectively, are unaudited but are prepared in conformity with
accounting principles used at our last fiscal year end and include all
adjustments which the Company considers necessary for a fair presentation.
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