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 Ended Commission File Number O-6421
September 30, 1997
SYNERGISTICS, INC.
MASSACHUSETTS 04-2283157
(State of Incorporation) (IRS Employer ID Number)
9 Tech Circle, Natick, MA 01760
(Address of Principal Executive Office) (Zip Code)
Registrant's telephone number,
including area code (508) 655-1340
Securities registered pursuant to Section 12(g) of the Act.
Common Stock $0.01 Par Value
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 preceeding 12 months (or 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
There is no public market for, and thus no aggregate market value of
the registrants securities.
Indicate the number of shares outstanding of each of the registrant
classes of common stock, as of the last practicable date.
Class Outstanding at October 31,1997
Common Stock, one cent par value 9,507,561
NO DOCUMENTS INCORPORATED BY REFERENCE
- ----------------------------------------------------------
SYNERGISTICS, INC.
BALANCE SHEET
ASSETS
(UNAUDITED)
Sept 30 Dec 31
1997 1996
CURRENT ASSETS
Cash $ 55,579 $ 101,550
Accounts receivable 374,480 527,559
Allowance (7,253) (35,000)
Inventories 290,343 239,818
Prepaid expenses 18,279 20,710
------- -------
TOTAL CURRENT ASSETS 731,428 854,637
EQUIPMENT, less allowances of
$72,963 and $60,363 for depreciation 58,543 62,289
DEFERRED TAXES 817,776 817,776
---------- ---------
TOTAL ASSETS 1,607,747 1,734,702
LIABILITIES, PREFERRED STOCK AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Trade accounts payable 186,760 220,275
Accrued expenses and
other current 58,983 65,263
Amount due stockholder 100,047 141,297
------- -------
TOTAL CURRENT LIABLITIES 345,790 426,835
STOCKHOLDERS' EQUITY
Common Stock (9,507,561
shares issued including
shares held in Treasury) 95,076 92,976
Additional paid-in capital 6,750,137 6,542,237
Retained earnings (deficit) (5,576,121)(5,320,211)
----------- -----------
1,269,092 1,315,002
Cost of Common Stock held in
Treasury (7,135) (7,135)
----------- ----------
1,261,957 1,307,867
TOTAL LIABILITIES, PREFERRED STOCK ----------- ----------
AND SHAREHOLDERS' EQUITY $ 1,607,747 $ 1,734,702
=========== ==========
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SYNERGISTICS, INC.
STATEMENT OF OPERATIONS
(UNAUDITED)
Three Months Ending Nine Months ending
September 30, September 30,
1997 1996 1997 1996
Sales 537,101 527,516 1,609,146 1,668,236
Other income 7,577 7,398 8,469 2,342
-------- ------- --------- ---------
544,678 534,914 1,617,615 1,670,578
Costs and expenses:
Cost of sales 408,485 319,436 1,203,199 977,652
Selling, general and
administrative 240,048 220,655 669,362 635,816
Interest expense 90 639 965 648
-------- ------- --------- ---------
648,623 540,739 1,873,526 1,614,116
Net income (loss) (103,945) (5,825) (255,911) 56,462
Income (loss) per share of Common Stock
Assuming no dilution (.01) (.00) ($0.03) $0.01
Assuming full dilution (.01) (.00) ($0.03) $0.01
- ----------------------------------------------------------
SYNERGISTICS, INC.
STATEMENT OF CHANGES IN FINANCIAL POSITION
PERIODS OF NINE MONTHS SEPTEMBER 30, 1997 AND 1996
(UNAUDITED)
1997 1996
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) (255,911) 56,462
Adjustments to reconcile net loss
to net cash (used) provided by
operating activities:
Depreciation 12,600 10,819
(Increase) decrease in:
accounts receivable 125,332 (12,138)
inventories (50,525) (63,666)
prepaid expenses
and other assets 2,431 (18,756)
accounts payable (33,515) (39,151)
accrued expenses and
other current liabilities (6,280) (6,312)
amounts due to shareholder (41,250) (41,249)
-------- -------
TOTAL ADJUSTMENTS 8,793 (170,453)
NET CASH USED BY
OPERATING ACTIVITIES (247,118) (113,991)
CASH FLOWS FROM INVESTING
ACTIVITIES
Capital expenditures (8,853) (24,130)
Stock issued 210,000 0
-------- ---------
NET CASH PROVIDED (USED) BY
INVESTING ACTIVITIES 201,147 (24,130)
------- -------
NET CHANGE IN CASH (45,971) (138,121)
CASH AT BEGINNING OF YEAR 101,550 332,151
-------- --------
CASH AT END OF PERIOD 55,579 194,030
======== =======
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SYNERGISTICS, INC.
SELECTED INFORMATION
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these financial statements be read in conjunction with the
financial statements and notes thereto included in the Company's An
Report Form 10-K. The results of operations for the period ended September
30, 1997 are not necessarily indicative of the operating results for
full year.
Basis of Presentation
It is the opinion of management that all significant adjustments which are
routine recurring adjustments reflected in the accompanying September 30
financial statements which are necessary to present fairly such interim
financial statements.
Accounting Policy for Revenues and Costs of Sales
Revenues are recognized at the time of product shipment. Cost of sales
is computed using the "gross profit" method based upon historical
results of operations. Other cost, included in costs of sales, are
based upon such costs as actually incurred.
Inventories
Inventories are comprised of the following:
* 9/30/97 12/31/96
Raw Materials 72,585 62,170
Finished Goods & WIP 217,758 177,648
------- -------
Total Inventories 290,343 239,818
*Allocation Based Upon Estimate
(Loss) per Common Share
The weighted average number of shares of common stock outstanding
used in computing (loss) per share does not include the effect of the
conversion of the stock options as the exercise price exceeds the current
market value of the security.
The following schedule sets forth the number of shares used in
computing earnings per share:
Period of Nine Months
Ended Sept 30,
1997 1996
Assuming no dilution
Common Stock Outstanding October 31, 1997 9,507,561 9,297,561
Shares held in Treasury 16,445 16,445
Total Shares Authorized 12,000,000 12,000,000
- ----------------------------------------------------------
PART I FINANCIAL INFORMATION
ITEM 1. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
For the nine months ended September 30, 1997, the Company recorded sales of
$1,609,146 compared to $1,668,236 for the nine months ended September 30,1996
At September 30, 1997 the Company had a backlog of $88,376 compared to
$48,631 at September 30, 1996.
Cost of sales as a percentage of sales increased to 74.8% from 58.6%
for the nine months ended September 30, 1997 and 1996, respectively.
This increase is due to the development of new products demanded by
our customers
For the period of nine months ended September 30, 1997, selling, general
and administrative expenses increased by $33,546 over the period of nine
months ended September 30, 1996.
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
There are currently no pending legal proceedings to which the Company
is a party or to which any of its property is subject.
ITEM 2. CHANGE IN SECURITIES
There have been no changes in the instruments defining the rights of
holders of any class of securities of the Company during the quarter
ending September 30, 1997.
ITEM 3. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There have been no matters submitted for a vote of the security holders
during the quarter ending September 30, 1997.
ITEM 4. EXHIBITS AND FORM 8-K
None.
Pursuant to the requirements of the Securities Act of 1934, the
registrant has duly caused this report to be signed on its behalf,
undersigned thereunto being duly authorized.
DATE_Nov 15, 1997______________ BY/S/WILLIAM M.TETRICK_______________
William M. Tetrick
Chairman of the Board
DATE_Nov 15, 1997______________ BY_/S/DAVID S. LONGWORTH____________
David S. Longworth
President and Clerk
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<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
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<RECEIVABLES> 374,480
<ALLOWANCES> 7,253
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<CGS> 1,203,199
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