0000898430-01-502632.txt : 20011009
0000898430-01-502632.hdr.sgml : 20011009
ACCESSION NUMBER: 0000898430-01-502632
CONFORMED SUBMISSION TYPE: 10QSB
PUBLIC DOCUMENT COUNT: 1
CONFORMED PERIOD OF REPORT: 20010831
FILED AS OF DATE: 20011001
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: DYNATEM INC
CENTRAL INDEX KEY: 0000795424
STANDARD INDUSTRIAL CLASSIFICATION: ELECTRONIC COMPUTERS [3571]
IRS NUMBER: 953627099
STATE OF INCORPORATION: CA
FISCAL YEAR END: 0531
FILING VALUES:
FORM TYPE: 10QSB
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-16250
FILM NUMBER: 1749582
BUSINESS ADDRESS:
STREET 1: 23263 MADERO SUITE C
STREET 2: STE B
CITY: MISSION VIEJO
STATE: CA
ZIP: 92691
BUSINESS PHONE: 7148553235
MAIL ADDRESS:
STREET 1: 23263 MADERO SUITE C
STREET 2: SUITE B
CITY: MISSION VIEJO
STATE: CA
ZIP: 92691
10QSB
1
d10qsb.txt
FORM 10-QSB
U. S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended August 31, 2001.
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file number 0-16250
DYNATEM, INC.
(Exact name of small business issuer as
specified in its charter)
California 95-3627099
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
23263 Madero, Suite C, Mission Viejo, California 92691
(Address of principal executive offices) (Zip Code)
Issuer's telephone number (949) 855-3235
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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
--- ---
On August 31, 2001, there were 1,418,400 shares of the issuer's Common Stock
outstanding.
Transitional Small Business Disclosure Format (check one):
Yes No X
---- ----
DYNATEM, INC.
INDEX
Part I. Financial Information
Item 1. Financial Statements
Balance Sheets at August 31, 2001
and May 31, 2001 1
Statements of Operations for the Three
Months Ended August 31, 2001
and 2000 2
Statements of Cash Flows for the Three
Months Ended August 31, 2001
and 2000 3
Notes to Financial Statements 4
Item 2. Management's Discussion and Analysis or
Plan of Operation 6
Part II. Other Information 7
PART I. FINANCIAL INFORMATION
---------------------
Item 1. Financial Statements
--------------------
DYNATEM, INC.
BALANCE SHEETS
August 31, May 31,
2001 2001
----------- -----------
(Unaudited) (Audited)
ASSETS
------
Current assets:
Cash and cash equivalents $ 675,257 $ 704,845
Accounts receivable, net 333,398 422,878
Inventories 642,121 568,975
Prepaid expenses 18,698 26,866
---------- -----------
Total current assets 1,669,474 1,723,564
Property and equipment, net 45,869 46,841
Other assets 61,338 22,350
---------- -----------
$1,776,681 $ 1,792,755
========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
Current liabilities:
Accounts payable $ 180,228 $ 224,117
Accrued expenses 163,389 215,073
---------- -----------
Total current liabilities 343,617 439,190
---------- -----------
Shareholders' equity:
Common stock, no par value, 50,000,000
authorized shares; 1,418,400 shares
issued and outstanding 2,383,385 2,383,385
Accumulated deficit (950,321) (1,029,820)
---------- -----------
Total shareholders' equity 1,433,064 1,353,565
---------- -----------
$1,776,681 $ 1,792,755
========== ===========
See accompanying notes to financial statements.
1
DYNATEM, INC.
STATEMENTS OF OPERATIONS (UNAUDITED)
Three months ended August 31, 2001 and 2000
2001 2000
---------- ----------
Net sales $ 642,346 $ 426,757
Cost of sales 331,287 270,266
---------- ----------
Gross profit 311,059 156,491
---------- ----------
Operating expenses:
Selling, general and administrative 185,231 129,417
Research and development 50,404 51,598
---------- ----------
Total operating expenses 235,635 181,015
---------- ----------
Operating income (loss) 75,424 (24,524)
Other income, net 4,875 3,600
---------- ----------
Income (loss) before income taxes 80,299 (20,924)
Provision for income taxes 800 -
---------- ----------
Net income (loss) $ 79,499 $ (20,924)
========== ==========
Net income available to common shareholders
per common share:
Basic $ 0.06 $ (0.01)
========== ==========
Diluted $ 0.05 $ (0.01)
========== ==========
Weighted average common shares outstanding:
Basic 1,418,400 1,418,400
========== ==========
Diluted 1,554,414 1,418,400
========== ==========
See accompanying notes to financial statements.
2
DYNATEM, INC.
STATEMENTS OF CASH FLOWS (UNAUDITED)
Three months ended August 31, 2001 and 2000
2001 2000
--------- ---------
Cash flows from operating activities:
Net income (loss) $ 79,499 $ (20,924)
Adjustments to reconcile net
income (loss) to net cash provided by
(used in)operating activities:
Depreciation and amortization 4,869 1,607
Changes in operating assets
and liabilities:
Accounts receivables 89,480 142,201
Inventories (73,146) (255,823)
Prepaid expenses 8,168 12,543
Accounts payable (43,889) 27,283
Accrued expenses (51,684) 2,933
--------- ---------
Net cash provided by (used in)
operating activities 13,297 (90,180)
--------- ---------
Cash flows from investing activities:
Purchases of fixed assets (3,897) -0-
Increase in other assets (38,988) (16,830)
--------- ---------
Net cash used in investing activities (42,885) (16,830)
--------- ---------
Cash flows from financing activities:
Repayment of notes receivable -0- 520
--------- ---------
Net decrease in cash and cash equivalents (29,588) (106,490)
Cash and cash equivalents, beginning balance 704,845 265,265
--------- ---------
Cash and cash equivalents, ending balance $ 675,257 $ 158,775
========= =========
Supplemental disclosures of cash flow information:
Cash paid during the quarter for:
Income taxes $ 800 $ -
========= =========
Interest $ - $ -
========= =========
See accompanying notes to financial statements.
3
DYNATEM, INC.
Notes to Financial Statements
(1) Interim Accounting Policy
-------------------------
In the opinion of the Company's management, the accompanying unaudited
statements include all adjustments including only normal recurring
adjustments necessary for a fair presentation of the financial position of
the Company as of August 31, 2001, and the results of operations and cash
flows for the three months ended August 31, 2001 and 2000. Although the
Company believes that the disclosures in these financial statements are
adequate to make the information presented not misleading, certain
information and footnote information normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to the rules and
regulations of the Securities and Exchange Commission. Results of
operations for interim periods are not necessarily indicative of results
of operations to be expected for the full year.
(2) Inventories
-----------
A summary of inventories follows:
August 31, 2001 May 31,2001
--------------- -----------
Finished goods $ 89,890 $ 76,138
Work-in-process 256,850 215,450
Raw materials 295,381 277,387
-------- --------
$642,121 $568,975
======== ========
(3) Earnings (loss) Per Share
-------------------------
Earnings (loss) per common share is computed based on the weighted average
number of common shares outstanding during the period presented. The
potential exercise of stock options and warrants is included in the
computation of net income per diluted share in the periods when net income
is reflected using the treasury stock method. Such information is not
included when net loss is reflected because the effect would be anti-
dilutive.
4
DYNATEM, INC.
Notes to Financial Statements
(4) Foreign Currency Transactions
-----------------------------
For the three months ended August 31, 2001 and 2000, transactions gains
and losses are not material to the financial statements taken as a
whole.
5
DYNATEM, INC.
Item 2. Management's Discussion and Analysis or Plan of Operation
---------------------------------------------------------
Revenues for the first quarter ended August 31, 2001 and 2000 were $642,346
and $426,757 respectively. The increase is the result of continued demand in
the market for the DRC1 product and growing sales of the third generation
Pentium III unit, the DPC2.
Cost of sales for the three months ended August 31, 2001, was $331,287 or 52%
of net sales and compares to $270,266 or 63% of net sales in the same period
a year ago. The decrease in cost of sales as a percent of net sales was the
result of improved margins of the DRC1 and other related products.
Operating expenses for the three months ended August 31, 2001 were $185,231
compared to $129,417 in the same period a year ago. The increase is the
result of personnel and payroll cost and marketing expenses.
Research and development expenses were $50,404 and $51,598 for the three
months ended August 31, 2001 and 2000, respectively.
The results of operations for the three months ended August 31, 2001 and
2000, reflect net income of $79,499 and a net loss of $20,924, respectively.
The income this quarter is the result of the increased sales of the DRC1
product.
Income tax for the three months ended August 31, 2001 and 2000 are not
considered material due to the utilization of net operating loss carry
forwards which will expire in various years through 2019.
Inventory for the three months ended August 31, 2001 was $642,121 compared to
$568,975 in the same period a year ago. The increase relates to growth of
sales and the addition of the DPC2 product.
The Company has arranged for a line of credit of $100,000 with its bank and
may consider other sources of capital should the need arise.
At August 31, 2001, the Company had a current ratio of 4.85:1 compared to a
ratio of 3.92:1 at May 31, 2001. The net worth of the Company at August 31,
2001 was $1,433,064, compared to $1,353,565 as of May 31, 2001.
6
DYNATEM, INC.
PART II. OTHER INFORMATION
-----------------
Items 1 through 5 have been omitted because there is nothing material to report
and there has been no report on Form 8-K during the quarter ended August 31,
2001.
SIGNATURES
----------
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
DYNATEM, INC.
October 1, 2001 By: /s/ Eileen DeSwert
--------------------------------
Eileen DeSwert, President and
Chief Executive Officer
October 1, 2001 By: /s/ Belen Ramos
--------------------------------
Belen Ramos, Chief Financial
Officer
7