10QSB 1 q304.txt FORM 10-QSB [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2004 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to____________ Commission File No. 000-49652 ZALDIVA, INC. ------------- (Name of Small Business Issuer in its Charter) FLORIDA 65-0773383 ------- ---------- (State or other jurisdiction of (I.R.S. Employer I.D. No.) incorporation or organization) 2805 East Oakland Park Blvd. #376 Fort Lauderdale, FL 33306 ------------------------- (Address of Principal Executive Office) Issuer's Telephone Number, including Area Code: (877) 925-3482 Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Sections 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. (1) Yes X No (2) Yes X No --- --- --- --- APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS Not applicable. APPLICABLE ONLY TO CORPORATE ISSUERS Indicate the number of shares outstanding of each of the Registrant's classes of common stock, as of the latest practicable date: May 6, 2004 6,220,000 PART I - FINANCIAL INFORMATION Item 1. Financial Statements. The financial statements of the Registrant required to be filed with this 10-QSB Quarterly Report were prepared by management, and commence of the following page, together with Related Notes. In the opinion of management, the financial statements fairly present the financial condition of the Registrant. ZALDIVA, INC. [A Development Stage Company] Condensed Financial Statements March 31, 2004
Zaldiva, Inc. [A Development Stage Company] Condensed Balance Sheets (Unaudited) ASSETS March 31, 2004 Current Assets Current Assets Cash $ 136,684 Accounts Receivable 492 Prepaid expenses 5,833 Inventory 23,873 --------- Total Current Assets 166,882 Equipment, net 23,709 --------- TOTAL ASSETS $ 190,591 ========= LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Related party payable $ 44 Unearned revenue 1,746 Accrued liabilities 200 --------- Total Current Liabilities 1,990 Stockholders' Equity Common stock 6,220 Additional paid in capital 236,280 Net Income (Loss) (53,899) --------- Total Stockholders' Equity 188,601 --------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 190,591 =========
See accompanying notes
Zaldiva, Inc. [A Development Stage Company] Condensed Statements of Operations (Unaudited) For the Three For the Three Months Ended Months Ended March 31, 2004 March 31, 2003 Revenues Cigar and Accessories $ 74,030 $ 149,750 Internet 1,808 4,813 Memorabilia 8,717 896 Cost of sales (39,079) (66,339) ----------- ---------- Gross Profit 45,476 89,120 Operating expense 66,408 58,658 ----------- ---------- Operating income (20,932) 30,462 Other income or expense 69 0 ----------- ---------- Net income before income taxes $ (20,863) $ 30,462 Income taxes 0 5,148 ----------- ---------- Net Income $ (20,863) $ 25,314 =========== ========== Net Income per Share $ (0.01) $ 0.01 =========== ========== Weighted Average Number of Shares Outstanding 6,032,308 5,000,000 =========== ==========
See accompanying notes Zaldiva, Inc. [A Development Stage Company] Condensed Statements of Operations (Unaudited)
For the Six For the Six Months Ended Months Ended March 31, 2004 March 31, 2003 Revenues Cigar and Accessories $ 180,059 $ 260,870 Internet 2,877 11,546 Memorabilia 14,206 1,368 Cost of sales (86,682) (93,027) ----------- ---------- Gross Profit 110,460 180,757 Web site development costs 1,545 13,160 Operating expense 123,523 101,521 ----------- ---------- Operating income (14,608) 66,076 Other income/(expense) 70 0 ----------- ---------- Net income before income taxes $ (14,538) $ 66,076 Income taxes 0 5,148 ----------- ---------- Net Income $ (14,538) $ 60,928 =========== ========== Net Income per Share $ (0.01) $ 0.01 =========== ========== Weighted Average Number of Shares Outstanding 5,341,600 5,000,000 =========== ==========
See accompanying notes
Zaldiva, Inc. [A Development Stage Company] Condensed Statements of Cash Flows (Unaudited) For the Six For the Six Months Ended Months Ended March 31, 2004 March 31, 2003 Cash Flows from Operating Activities: Net Income $ (14,538) $ 60,928 Adjustments to reconcile net loss to net cash used for operating activities: Depreciation 2,855 2,204 Increase (Decrease) in current liabilities (5,444) (809) Decrease (Increase) in current assets 8,258 0 Inventory contributed and sold 0 0 Increase in inventory (7,541) (15,049) Increase in income taxes payable 0 5,148 ----------- --------- Net Cash Flows from Operating Activities (26,410) 52,422 ----------- --------- Cash Flows from Investing Activities: Equipment purchases 0 (4,665) ----------- --------- Net Cash Flows from Investing Activities 0 (4,665) Cash Flows From Financing Activities: Issued stock for cash 152,500 0 ----------- --------- Net Cash Flows from Financing Activities 152,500 0 ----------- --------- Net Increase (Decrease) in Cash 126,090 47,757 Beginning Cash Balance 10,594 4,065 ----------- --------- Ending Cash Balance $ 136,684 $ 51,822 =========== ========= Supplemental disclosure information: Cash paid for interest $ 0 $ 0 Cash paid for income taxes $ 0 $ 0 Inventory/Assets contributed in $ 0 $ 0
See accompanying notes Zaldiva, Inc. [A Development Stage Company] Notes to Condensed Financial Statements March 31, 2004 PRELIMINARY NOTE The accompanying condensed financial statements have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures normally included in financial statements prepared in accordance with U. S. generally accepted accounting principles have been condensed or omitted. These interim financial statements include all adjustments, which in the opinion of management, are necessary in order to make the financial statements not misleading. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company's Annual Report for the year ended September 30, 2003. Item 2. Management's Discussion and Analysis or Plan of operation. Results of Operations. ---------------------- For The Three Months Ended March 31, 2004 Compared to The Three Months Ended March 31, 2003 -------------------- During the quarterly period ended March 31, 2004, we received revenues of $84,555, as compared to revenues of $155,459 during the quarterly period ended March 31, 2003. In the 2004 period, $74,030 was from cigar and accessory sales, $8,717 came from memorabilia and $1,808 came from our internet sources. In the 2003 period, $149,750 was derived from sales of cigars and accessories, $896 from memorabilia and $4,813 came from our internet sources. These figures reflect the diminishing relative importance of our cigar and accessory sales operations and our internet services operations. In comparison, revenues from our online memorabilia sales operations increased by approximately 873% from the first quarter of 2003 to the first quarter of 2004. In the future, we intend to focus our efforts more on the higher gross margin aspects of our business; i.e., memorabilia and premium cigar sales. Costs of sales during the three months ended March 31, 2004, were $39,079, as compared to $66,339 in the year-ago period. This decline is due principally to the decline in overall sales in 2004. Operating expenses increased to $66,408 during the quarterly period ended March 31, 2004, from $58,658 in the year-ago period. This increase was due partly to increased internet advertising expenses. For the three months ended March 31, 2004, we had a net loss of $20,863, as compared to a net income of $25,314 during the March 31, 2003, period. For The Six Months Ended March 31, 2004 Compared to The Six Months Ended March 31, 2003 -------------------- During the six months ended March 31, 2004, total revenues were $197,142, versus total revenues of $273,784 during the six months ended March 31, 2003. In the 2004 period, $180,059 came from cigar and accessory sales, with $14,206 derived from online memorabilia sales and $2,877 coming from our internet services. In the 2003 period, $260,870 in revenue came from sales of cigars and accessories, $1,368 from memorabilia sales and $11,546 came from our internet sources. Again, these figures reflect the increased significance of our memorabilia sales operations, although cigar and accessory sales still account for approximately 91% of our total revenues. Costs of sales during the six months ended March 31, 2004, were $86,682, as compared to $93,027 in the year-ago period. Web site development costs declined significantly from the prior year period due to decreased expenses for software purchases. These costs totaled only $1,545 in the 2004 period, versus $13,160 during the six months ended March 31, 2003. Operating expenses increased by approximately 21.7% in the first half of our 2004 fiscal year. These expenses were $123,523 in the current period and $101,521 in the 2003 period. For the six months ended March 31, 2004, we had a net loss of $14,538, as compared to net income of $60,928 during the March 31, 2003, period. Liquidity. ---------- The Company had cash on hand of $136,684 at March 31, 2004. During the quarter ended March 31, 2004, a large portion of the Company's liquidity came from stock that was issued for cash. If we are not able to sustain an operating profit, we expect that we will have to raise money again by selling shares of common stock or through loans. Financing for the Company's activities to date has been primarily provided by issuance of common stock for cash and for services. The Company's ability to achieve a level of profitable operations and/or additional financing may affect its ability to continue as a going concern. Forward-Looking Information. ---------------------------- Statements made in this Form 10-QSB which are not purely historical are forward-looking statements with respect to the goals, plan objectives, intentions, expectations, financial condition, results of operations, future performance and business of the Company, including, without limitation, (i) our ability to gain a larger share of the market in our industry, our ability to continue to market products acceptable to consumers, and our ability to retain relationships with suppliers, and (ii) statements preceded by, followed by or that include the words "may", "would", "could", "should", "expects", "projects", "anticipates", "believes", "estimates", "plans", "intends", "targets" or similar expressions. Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond the Company's control) that could cause actual results to differ materially from those set forth in the forward-looking statements, including the following, in addition to those contained in the Company's reports on file with the Securities and Exchange Commission: general economic or industry conditions, nationally and/or in the communities in which the Company conducts business, changes in the interest rate environment, legislation or regulatory requirements, conditions of the securities markets, changes in the internet retailing industry, the development of products that may be superior to the products offered by the Company, competition, changes in the quality or composition of the Company's products, our ability to develop new products, our ability to raise capital, changes in accounting principals, policies or guidelines, financial or political instability, acts of war or terrorism, other economic, competitive, governmental, regulatory and technical factors affecting the Company's operations, products, services and prices. Accordingly, results actually achieved may differ materially from expected results in these statements. Forward-looking statements speak only as of the date they are made. The Company does not undertake, and specifically disclaims, any obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of such statements. Item 3. Controls and Procedures. Within 90 days prior to the date of this report, we carried out an evaluation, under the supervision and with the participation of our President and Secretary/Treasurer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our President and Secretary/Treasurer concluded that our disclosure controls and procedures are effective in timely alerting them to material information required to be included in our periodic Securities and Exchange Commission reports. It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote. In addition, we reviewed our internal controls, and there have been no significant changes in our internal controls or in other factors that could significantly affect those controls subsequent to the date of their last evaluation. PART II - OTHER INFORMATION Item 1. Legal Proceedings. The Company is not a party to any pending legal proceeding that primarily involves a claim for damages, exclusive of interest and costs, that exceeds 10% of its current assets Item 2. Changes in Securities and Small Business Issuer Purchases of Equity Securities. During the quarter ended March 31, 2004, the Company raised $152,500 from the sale of 1,220,000 Units to four "accredited" investors at a price of $0.125 per Unit. Each Unit consists of one "unregistered" and "restricted" share of common stock and one warrant to purchase an additional share of common stock for $0.25, exercisable for five years. The Units were sold to Christopher R. Ebersole; Super Distributors, Inc.; Jeffrey A. Olweean; and Cheq Industrial, in the amount of 305,000 Units each. We believe that the offer and sale of these securities was exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Sections 4(2) and 4(6) thereof, and Rule 506 of Regulation D of the Securities and Exchange Commission and pursuant to various similar state exemptions. Item 3. Defaults Upon Senior Securities. None; not applicable. Item 4. Submission of Matters to a Vote of Security Holders. No matter was submitted to a vote of the Company's security holders during the period covered by this report. Item 5. Other Information. None; not applicable. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits. None. (b) Reports on Form 8-K. None. SIGNATURES In accordance with the requirements of the Securities Exchange Act, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. ZALDIVA, INC. Date: 5-10-04 /s/ Robert B. Lees ------- ------------------ Robert B. Lees, Director and President Date: 5/11/04 /s/ John A. Palmer, Jr. ------- ----------------------- John A. Palmer, Jr., Director, Secretary and Treasurer