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
March 31, 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's
classes of common stock, as of the last practicable date.
Class Outstanding at April 30,1997
Common Stock, one cent par value 9,297,561
NO DOCUMENTS INCORPORATED BY REFERENCE
<PAGE>
SYNERGISTICS, INC.
BALANCE SHEET
ASSETS
(UNAUDITED)
Mar 31 Dec 31
1997 1996
CURRENT ASSETS
Cash $ 233,904 $ 101,550
Accounts receivable 331,882 492,559
Inventories 300,179 239,818
Prepaid expenses 32,600 20,710
------- -------
TOTAL CURRENT ASSETS 898,565 854,637
EQUIPMENT, less allowances of $64,563
and $60,363 for depreciation 58,089 62,289
DEFERRED TAXES 817,776 817,776
--------- ---------
TOTAL ASSETS $1,774,430 $1,734,702
========= =========
LIABILITIES, PREFERRED STOCK AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Trade accounts payable $ 220,282 $ 220,275
Accrued expenses and other current 216,051 65,263
Amount due stockholder 127,547 141,297
------- -------
TOTAL CURRENT LIABLITIES 563,880 426,835
STOCKHOLDERS' EQUITY
Common Stock (9,297,561 shares issued
including shares held in Treasur 92,976 92,976
Additional paid-in capital 6,542,237 6,542,237
Retained earnings (deficit) (5,417,528) (5,320,211)
--------- ---------
1,217,685 1,315,002
Cost of Common Stock held in Treas (7,135) (7,135)
--------- ---------
1,210,550 1,307,867
TOTAL LIABILITIES, PREFERRED --------- ---------
STOCK AND SHAREHOLDERS' EQUITY $1,774,430 $1,734,702
========= =========
(UNAUDITED)
SYNERGISTICS, INC.
STATEMENT OF OPERATIONS
PERIOD OF THREE MONTHS ENDED MARCH 31,1996 AND 1995
1997 1996
Sales $ 469,309 $ 480,532
Other income 3,133 12,342
------- -------
472,442 492,874
Costs and expenses:
Cost of sales 360,602 309,594
Selling, general and administrative 208,686 197,463
Interest expense 472 0
------- -------
569,760 507,057
------- -------
Net gain (loss) $(97,318) $(14,183)
======= =======
Gain (loss) per share of Common Stock
Assuming no dilution ($0.00) $0.00
Assuming full dilution ($0.00) $0.00
(UNAUDITED)
SYNERGISTICS, INC.
STATEMENT OF CHANGES IN FINANCIAL POSITION
PERIODS OF THREE MONTHS MARCH 31, 1996 AND 1995
1997 1996
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $(97,318) $ (14,183)
Adjustments to reconcile net loss to net
cash (used) provided by operating activities:
Depreciation 4,200 3,285
(Increase) decrease in accounts
receivable 677 (17,890)
(Increase) decrease in inventories (60,361) (22,609)
(Increase) decrease in prepaid expenses
and other assets (11,889) (19,761)
Increase (decrease) in accounts
payable 7 (18,955)
Increase (decrease) in accrued expenses
and other current liabilities 150,788 ( 8,116)
Increase (decrease) in amounts due
shareholder (13,750) (13,749)
------- -------
TOTAL ADJUSTMENTS 69,672 (97,761)
------- -------
NET CASH USED BY OPERATING ACTIVITIES (27,646) (111,944)
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures 0 (6,550)
------ ------
NET CASH (USED) BY INVESTING ACTIVITIES 0 ( 6,550)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from the sale of stock 160,000 0
-------- --------
NET CASH FROM FINANCING ACTIVITIES 160,000 0
-------- ---------
NET CHANGE IN CASH 132,354 (118,494)
CASH AT BEGINNING OF YEAR 101,550 332,151
------- -------
CASH AT END OF PERIOD 233,904 213,657
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 Annual
Report Form 10-K. The results of operations for the period ended March
31, 1997 are not necessarily indicative of the operating results for the
full year.
Basis of Presentation
It is the opinion of management that all significant adjustments which are
routine recurring adjustments reflected in the accompanying March 31
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 acutally incurred.
Inventories
Inventories are comprised of the following:
* 3/31/97 12/31/96
Finished Goods & WIP 75,035 61,170
Finished Goods & WIP 225,104 177,648
------- -------
Total Inventories 300,139 239.818
*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 Three Months
Ended March 31
1997 1996
Assuming no dilution
Common Stock Outstanding April 30, 1997 9,297,561 9,297,561
Shares held in Treasury 16,445 16,445
Total Shares 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 three months ended March 31, 1997, the Company recorded sales of
$469,309 compared to $480,532. At March 31, 1997 the Company had a
backlog of approximately $64,596 compared to $73,794 at March 31, 1996.
Cost of sales as a percentage of sales increased to 76.8% from 64.4%
for the three months ended March 31, 1997 and 1996, respectively. This
increase is due to the development of product enhancements in demand by
our customers.
For the period of three months ended March 31, 1997, selling, general
and administrative expenses increased by $11,223 over the period of three
months ended March 31, 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 first
three months of calendar year 1997.
ITEM 3. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were brought to a vote of the Company;s security holders
during the first quarter.
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, the
undersigned thereunto being duly authorized.
DATE 2/28/97 BY /S/WILLIAM M. TETRICK
William M. Tetrick
Chairman of the Board
DATE 2/28/97 BY /S/DAVID S. LONGWORTH
David S. Longworth
President and Clerk
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1997
<CASH> 233,904
<SECURITIES> 0
<RECEIVABLES> 366,882
<ALLOWANCES> 35,000
<INVENTORY> 300,179
<CURRENT-ASSETS> 898,565
<PP&E> 122,652
<DEPRECIATION> 64,563
<TOTAL-ASSETS> 1,774,430
<CURRENT-LIABILITIES> 563,880
<BONDS> 0
0
0
<COMMON> 92,976
<OTHER-SE> 1,210,550
<TOTAL-LIABILITY-AND-EQUITY> 1,774,430
<SALES> 469,309
<TOTAL-REVENUES> 472,442
<CGS> 360,602
<TOTAL-COSTS> 569,760
<OTHER-EXPENSES> 208,686
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 472
<INCOME-PRETAX> (97,318)
<INCOME-TAX> 0
<INCOME-CONTINUING> (97,318)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (97,318)
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
