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, 1996
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 No x
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 30,1996
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
1996 1995
CURRENT ASSETS
Cash $ 213,657 $ 332,151
Accounts receivable 364,685 346,795
Inventories 224,155 201,546
Prepaid expenses 42,907 23,180
------- -------
TOTAL CURRENT ASSETS 845,404 903,672
EQUIPMENT, less allowances of $48,985
and $45,700 for depreciation 56,060 52,795
DEFERRED TAXES 817,776 817,776
--------- ---------
TOTAL ASSETS $1,719,240 $1,774,243
========= =========
LIABILITIES, PREFERRED STOCK AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Trade accounts payable $ 144,819 $ 163,774
Accrued expenses and other current 59,517 67,633
Amount due stockholder 182,547 196,296
------- -------
TOTAL CURRENT LIABLITIES 386,883 427,703
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) (5,295,721) (5,281,538)
--------- ---------
1,339,492 1,353,675
Cost of Common Stock held in Treas (7,135) (7,135)
--------- ---------
1,332,357 1,346,540
TOTAL LIABILITIES, PREFERRED --------- ---------
STOCK AND SHAREHOLDERS' EQUITY $1,719,240 $1,774,243
========= =========
(UNAUDITED)
SYNERGISTICS, INC.
STATEMENT OF OPERATIONS
PERIOD OF THREE MONTHS ENDED MARCH 31,1996 AND 1995
1996 1995
Sales $ 480,532 $ 547,568
Other income 4,635 3,906
------- -------
485,167 551,474
Costs and expenses:
Cost of sales 240,910 252,559
Selling, general and administrative 258,440 210,183
Interest expense 0 46,357
------- -------
499,350 509,099
------- -------
Net gain (loss) $(14,183) $ 42,375
======= =======
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
1996 1995
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $(14,183) $ 42,375
Adjustments to reconcile net loss to net
cash (used) provided by operating activities:
Depreciation 3,285 1,636
(Increase) decrease in accounts re (17,890) 41,884
(Increase) decrease in inventories (22,609) (19,652)
(Increase) decrease in prepaid expenses
and other assets (19,727) 206
Increase (decrease) in accounts pa (18,955) 98,557
Increase (decrease) in accrued expenses
and other current liabilities (8,116) (109,931)
Increase (decrease) in amounts due
shareholder (13,749) 0
------- -------
TOTAL ADJUSTMENTS (97,761) 12,700
------- -------
NET CASH USED BY OPERATING ACTIVITIES (111,944) 55,075
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (6,550) (13,409)
------ ------
NET CASH (USED) BY INVESTING ACTIVITIES (6,550) (13,409)
------- ------
NET CHANGE IN CASH (118,494) 41,666
CASH AT BEGINNING OF YEAR 332,151 149,909
------- -------
CASH AT END OF PERIOD 213,657 191,575
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, 1996 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:
* 3/31/96 12/31/95
Finished Goods & WIP 100,000 90,000
Finished Goods & WIP 124,155 111,546
------- -------
Total Inventories 224,155 201,546
*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
1996 1995
Assuming no dilution
Common Stock Outstanding April 30, 1996 9,297,561
Shares held in Treasury 16,445
Total Shares 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, 1996, the Company recorded sales of
$480,532 compared to $547,568. At March 31, 1996 the Company had a
backlog of approximately $73,794.
Cost of sales as a percentage of sales increased to 50.1% from 46.1%
for the three months ended March 31, 1996 and 1995, respectively.
For the period of three months ended March 31, 1996, selling, general
and administrative expenses increased by $48,257 over the period of three
months ended March 31, 1995. Development expenses approximated $60,975
and $50,260 for the period three months ended March 31, 1996 and 1995
respectively.
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 1996.
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-31-1996
<CASH> 213,657
<SECURITIES> 0
<RECEIVABLES> 399,685
<ALLOWANCES> 35,000
<INVENTORY> 224,155
<CURRENT-ASSETS> 845,404
<PP&E> 105,045
<DEPRECIATION> 48,985
<TOTAL-ASSETS> 1,719,240
<CURRENT-LIABILITIES> 386,883
<BONDS> 0
0
0
<COMMON> 92,976
<OTHER-SE> 1,239,381
<TOTAL-LIABILITY-AND-EQUITY> 1,719,240
<SALES> 480,532
<TOTAL-REVENUES> 485,167
<CGS> 240,910
<TOTAL-COSTS> 240,910
<OTHER-EXPENSES> 258,440
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (14,183)
<INCOME-TAX> 0
<INCOME-CONTINUING> (14,183)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (14,183)
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
