Delaware (State or Other Jurisdiction | ||
of Incorporation or organization) | 22-1896032 (I.R.S. Employer Identification Number) |
ADM TRONICS UNLIMITED, INC., AND SUBSIDIARIES | ||||
INDEX | ||||
Page Number | ||||
Part I - Financial Information | ||||
Item 1. | Condended Consolidated Financial Statements: | |||
Condensed Consolidated Balance Sheet - | 3 | |||
Condensed Consolidated Statements of Operations for the three and | 4 | |||
Condensed Consolidated Statements of Cash Flow for the | 5 | |||
Notes to the Condensed Consolidated Financial Statements (unaudited) | 6 | |||
Item 2. | Management's Discussion and Analysis of Financial Condition and Results of Operations | 11 | ||
Item 3. | Quantitative and Qualitative Disclosures about Market Risk | 14 | ||
Item 4. | Controls and Procedures | 15 | ||
Part II - Other Information | ||||
Item 1. | Legal Proceedings | 15 | ||
Item 1A. | Risk Factors | 15 | ||
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 15 | ||
Item 3. | Defaults Upon Senior Securities | 15 | ||
Item 4. | Other Information | 15 | ||
Item 5. | Exhibits | 15 |
September 30, 2012 | March 31, 2012 | December 31, 2012 | March 31, 2012 | |||||||||||||
ASSETS | ||||||||||||||||
Current assets: | ||||||||||||||||
Cash and cash equivalents | $ | 241,411 | $ | 299,156 | $ | 214,300 | $ | 299,156 | ||||||||
Accounts receivable, net of allowance for doubtful accounts of $500 and $329, respectively | 212,819 | 285,159 | 156,451 | 285,159 | ||||||||||||
Inventories | 241,705 | 260,632 | 280,752 | 260,632 | ||||||||||||
Prepaid expenses and other current assets | 18,235 | 26,157 | 14,114 | 26,157 | ||||||||||||
Restricted cash | 231,782 | 231,455 | 231,782 | 231,455 | ||||||||||||
Total current assets | 945,952 | 1,102,559 | 897,399 | 1,102,559 | ||||||||||||
Property and equipment, net of accumulated depreciation of $59,298 and $53,574, respectively | 18,018 | 23,742 | ||||||||||||||
Property and equipment, net of accumulated depreciation of $61,264 and $53,574, respectively | 16,052 | 23,742 | ||||||||||||||
Inventories - long-term portion | 76,248 | 42,743 | 73,319 | 42,743 | ||||||||||||
Secured convertible note receivable | 56,627 | 62,351 | 57,664 | 62,351 | ||||||||||||
Advances to related parties | 22,480 | 22,480 | 22,480 | 22,480 | ||||||||||||
Intangible assets, net of accumulated amortization of $108,074 and $101,682, respectively | 60,074 | 66,466 | ||||||||||||||
Intangible assets, net of accumulated amortization of $110,888 and $101,682, respectively | 57,260 | 66,466 | ||||||||||||||
Other assets | 16,109 | 16,109 | 16,109 | 16,109 | ||||||||||||
Total other assets | 249,556 | 233,891 | 242,884 | 233,891 | ||||||||||||
Total assets | $ | 1,195,508 | $ | 1,336,450 | $ | 1,140,283 | $ | 1,336,450 | ||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||||
Current liabilities: | ||||||||||||||||
Note payable - bank | $ | 153,990 | $ | 160,000 | $ | 150,990 | $ | 160,000 | ||||||||
Accounts payable | 149,005 | 148,832 | 213,070 | 148,832 | ||||||||||||
Customer deposit | - | 21,023 | - | 21,023 | ||||||||||||
Accrued fees | 215,305 | 197,120 | ||||||||||||||
Accrued expenses and other current liabilities | 159,930 | 188,815 | 401,620 | 385,935 | ||||||||||||
Total current liabilities | 678,230 | 715,790 | 765,680 | 715,790 | ||||||||||||
Total liabilities | 678,230 | 715,790 | 765,680 | 715,790 | ||||||||||||
Stockholders' equity: | ||||||||||||||||
Preferred stock, $.01 par value; 5,000,000 shares authorized, no shares issued and outstanding | - | - | - | - | ||||||||||||
Common stock, $.0005 par value; 150,000,000 shares authorized, 56,939,537 shares issued and outstanding at September 30, 2012 and March 31, 2012 | 28,470 | 28,470 | ||||||||||||||
Common stock, $.0005 par value; 150,000,000 shares authorized, 56,939,537 shares issued and outstanding at December 31, 2012 and March 31, 2012 | 28,470 | 28,470 | ||||||||||||||
Additional paid-in capital | 32,173,097 | 32,173,097 | 32,223,097 | 32,173,097 | ||||||||||||
Accumulated deficit | (31,684,289 | ) | (31,580,907 | ) | (31,876,964 | ) | (31,580,907 | ) | ||||||||
Total stockholders' equity | 517,278 | 620,660 | 374,603 | 620,660 | ||||||||||||
Total liabilities and stockholders' equity | $ | 1,195,508 | $ | 1,336,450 | $ | 1,140,283 | $ | 1,336,450 |
Three months ended September 30, | Six months ended September 30, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Net revenues | $ | 384,673 | $ | 472,689 | $ | 901,912 | $ | 891,751 | ||||||||
Cost of sales | 179,118 | 191,252 | 353,793 | 405,463 | ||||||||||||
Gross Profit | 205,555 | 281,437 | 548,119 | 486,288 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 9,143 | 8,697 | 18,274 | 18,001 | ||||||||||||
Selling, general and administrative | 280,652 | 230,966 | 620,063 | 466,768 | ||||||||||||
Depreciation and amortization | 4,713 | 10,693 | 12,116 | 21,460 | ||||||||||||
Total operating expenses | 294,508 | 250,356 | 650,453 | 506,229 | ||||||||||||
Income (loss) from operations | (88,953 | ) | 31,081 | (102,334 | ) | (19,941 | ) | |||||||||
Other income (expense): | ||||||||||||||||
Interest income | 1,302 | 1,599 | 2,745 | 3,240 | ||||||||||||
Interest expense | (1,904 | ) | (1,034 | ) | (3,793 | ) | (2,098 | ) | ||||||||
Total other income (expense) | (602 | ) | 565 | (1,048 | ) | 1,142 | ||||||||||
Net income (loss) | $ | (89,555 | ) | $ | 31,646 | $ | (103,382 | ) | $ | (18,799 | ) | |||||
Basic and diluted (loss) per common share: | $ | (0.00 | ) | $ | 0.00 | $ | (0.00 | ) | $ | (0.00 | ) | |||||
Weighted average shares of common stock outstanding - basic and diluted | 56,939,537 | 53,939,537 | 56,939,537 | 53,939,537 |
Three months ended December 31, | Nine months ended December 31, | |||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Net revenues | $ | 306,522 | $ | 452,943 | $ | 1,208,434 | $ | 1,344,694 | ||||||||
Cost of sales | 148,090 | 193,553 | 501,883 | 599,016 | ||||||||||||
Gross Profit | 158,432 | 259,390 | 706,551 | 745,678 | ||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | 6,999 | 8,630 | 25,273 | 26,630 | ||||||||||||
Selling, general and administrative | 338,510 | 273,329 | 958,573 | 740,098 | ||||||||||||
Depreciation and amortization | 4,780 | 11,185 | 16,896 | 32,645 | ||||||||||||
Total operating expenses | 350,289 | 293,144 | 1,000,742 | 799,373 | ||||||||||||
Loss from operations | (191,857 | ) | (33,754 | ) | (294,191 | ) | (53,695 | ) | ||||||||
Other income (expense): | ||||||||||||||||
Interest income | 1,038 | 1,484 | 3,783 | 4,724 | ||||||||||||
Interest expense | (1,856 | ) | (1,336 | ) | (5,649 | ) | (3,434 | ) | ||||||||
Total other income (expense) | (818 | ) | 148 | (1,866 | ) | 1,290 | ||||||||||
Net Loss | $ | (192,675 | ) | $ | (33,606 | ) | $ | (296,057 | ) | $ | (52,405 | ) | ||||
Basic and diluted (loss) per common share: | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.01 | ) | $ | (0.00 | ) | ||||
Weighted average shares of common stock outstanding - basic and diluted | 56,939,537 | 53,939,537 | 56,939,537 | 53,939,537 |
2012 | 2011 | 2012 | 2011 | |||||||||||||
Cash flows from operating activities: | ||||||||||||||||
Net loss | $ | (103,382 | ) | $ | (18,799 | ) | $ | (296,057 | ) | $ | (52,405 | ) | ||||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||||||||||
Depreciation and amortization | 12,116 | 21,460 | 16,896 | 32,645 | ||||||||||||
Stock based compensation | 50,000 | - | ||||||||||||||
Interest receivable | (2,276 | ) | (2,507 | ) | (3,313 | ) | (3,767 | ) | ||||||||
Bad debt expense | 171 | - | 171 | - | ||||||||||||
Increase (decrease) in cash flows as a result of changes in assets and liabilities balances: | Increase (decrease) in cash flows as a result of changes in assets and liabilities balances: | Increase (decrease) in cash flows as a result of changes in assets and liabilities balances: | ||||||||||||||
Accounts receivable | 72,169 | (108,792 | ) | 128,537 | (57,929 | ) | ||||||||||
Inventory | (14,578 | ) | (58,382 | ) | (50,696 | ) | (131,833 | ) | ||||||||
Prepaid expenses and other current assets | 2,506 | (37,010 | ) | 8,948 | (39,212 | ) | ||||||||||
Accounts payable | 5,589 | 16,073 | 67,333 | 21,593 | ||||||||||||
Accrued fees | 18,185 | - | ||||||||||||||
Customer deposit | (21,023 | ) | 150,816 | (21,023 | ) | 108,751 | ||||||||||
Accrued expenses and other current liabilities | (28,885 | ) | 63,459 | 15,685 | 112,921 | |||||||||||
Net cash provided by (used) in operating activities | (59,408 | ) | 26,318 | |||||||||||||
Net cash used in operating activities | (83,519 | ) | (9,236 | ) | ||||||||||||
Cash flows from investing activities: | ||||||||||||||||
Repayment from related party | - | 2,936 | ||||||||||||||
Payment for equipment costs | - | (2,296 | ) | |||||||||||||
Collections from secured convertible note | 8,000 | - | 8,000 | - | ||||||||||||
Payment for patents and trademark costs | - | (3,584 | ) | - | (3,584 | ) | ||||||||||
Restricted cash | (327 | ) | (543 | ) | (327 | ) | (720 | ) | ||||||||
Net cash provided by (used in) investing activities | 7,673 | (4,127 | ) | 7,673 | (3,664 | ) | ||||||||||
Cash flows from financing activities: | ||||||||||||||||
Repayments on note payable - Bank | (6,010 | ) | (6,000 | ) | (9,010 | ) | (9,000 | ) | ||||||||
Repayments on note payable - Other | - | (7,250 | ) | - | (13,900 | ) | ||||||||||
Net cash used in financing activities | (6,010 | ) | (13,250 | ) | (9,010 | ) | (22,900 | ) | ||||||||
Net increase (decrease) in cash | (57,745 | ) | 8,941 | |||||||||||||
Net decrease in cash | (84,856 | ) | (35,800 | ) | ||||||||||||
Cash and cash equivalents beginning of year | 299,156 | 155,149 | ||||||||||||||
Cash and cash equivalents beginning of period | 299,156 | 155,149 | ||||||||||||||
Cash and cash equivalents at end of year | $ | 241,411 | $ | 164,090 | ||||||||||||
Cash and cash equivalents at end of period | $ | 214,300 | $ | 119,349 | ||||||||||||
Cash paid for: | ||||||||||||||||
Interest | $ | 2,115 | $ | 2,098 | $ | 2,115 | $ | 3,056 | ||||||||
Income taxes | $ | - | $ | - | ||||||||||||
Supplemental disclosures of non-cash investing and financing activities: | Supplemental disclosures of non-cash investing and financing activities: | Supplemental disclosures of non-cash investing and financing activities: | ||||||||||||||
Accrued interest on note receivable | $ | 2,276 | $ | 2,507 | $ | 3,313 | $ | 3,767 | ||||||||
Increase in prepaid insurance and accounts payable | $ | 5,416 | $ | 8,466 | $ | 3,095 | $ | 8,466 |
Current | Long Term | Total | ||||||||||
Raw materials | $ | 196,480 | $ | 69,072 | $ | 265,552 | ||||||
Finished Goods | 45,225 | 7,176 | 52,401 | |||||||||
$ | 241,705 | $ | 76,248 | $ | 317,953 |
Current | Long Term | Total | ||||||||||
Raw materials | $ | 223,658 | $ | 68,408 | $ | 292,066 | ||||||
Finished Goods | 57,094 | 4,911 | 62,005 | |||||||||
$ | 280,752 | $ | 73,319 | $ | 354,071 |
Current | Long Term | Total | ||||||||||
Raw materials | $ | 204,367 | $ | 38,555 | $ | 242,922 | ||||||
Finished Goods | 56,265 | 4,188 | 60,453 | |||||||||
$ | 260,632 | $ | 42,743 | $ | 303,375 |
Current | Long Term | Total | ||||||||||
Raw materials | $ | 204,367 | $ | 38,555 | $ | 242,922 | ||||||
Finished Goods | 56,265 | 4,188 | 60,453 | |||||||||
$ | 260,632 | $ | 42,743 | $ | 303,375 |
September 30, 2012 | March 31, 2012 | December 31, 2012 | March 31, 2012 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cost | Weighted Average Amortization Period (years) | Accumulated Amortization | Net Carrying Amount | Cost | Weighted Average Amortization Period (years) | Accumulated Amortization | Net Carrying Amount | Cost | Weighted Average Amortization Period (years) | Accumulated Amortization | Net Carrying Amount | Cost | Weighted Average Amortization Period (years) | Accumulated Amortization | Net Carrying Amount | |||||||||||||||||||||||||||||||||||||||||||
Patents & Trademarks | $ | 82,702 | 15 | $ | (63,464 | ) | $ | 19,238 | $ | 82,702 | 15 | $ | (62,464 | ) | $ | 20,238 | $ | 82,702 | 15 | $ | (63,916 | ) | $ | 18,786 | $ | 82,702 | 15 | $ | (62,464 | ) | $ | 20,238 | ||||||||||||||||||||||||||
Formulas | 25,446 | 15 | (5,443 | ) | 20,003 | 25,446 | 15 | (4,595 | ) | 20,851 | 25,446 | 15 | (6,020 | ) | 19,426 | 25,446 | 15 | (4,595 | ) | 20,851 | ||||||||||||||||||||||||||||||||||||||
Non-Compete Agreement | 50,000 | 7 | (29,167 | ) | 20,833 | 50,000 | 7 | (25,595 | ) | 24,405 | 50,000 | 7 | (30,952 | ) | 19,048 | 50,000 | 7 | (25,595 | ) | 24,405 | ||||||||||||||||||||||||||||||||||||||
Customer List | 10,000 | 3 | (10,000 | ) | - | 10,000 | 3 | (9,028 | ) | 972 | 10,000 | 3 | (10,000 | ) | - | 10,000 | 3 | (9,028 | ) | 972 | ||||||||||||||||||||||||||||||||||||||
$ | 168,148 | $ | (108,074 | ) | $ | 60,074 | $ | 168,148 | $ | (101,682 | ) | $ | 66,466 | $ | 168,148 | $ | (110,888 | ) | $ | 57,260 | $ | 168,148 | $ | (101,682 | ) | $ | 66,466 |
2013 | $ | 5,501 | |||
2014 | 10,828 | ||||
2015 | 10,779 | ||||
2016 | 6,068 | ||||
2017 | 3,092 | ||||
Thereafter | 23,806 | ||||
$ | 60,074 |
2013 | $ | 2,512 | |||||
2014 | 10,650 | ||||||
2015 | 10,601 | ||||||
2016 | 5,890 | ||||||
2017 | 2,914 | ||||||
Thereafter | 24,693 | ||||||
$ | 57,260 |
Chemical | Electronics | Total | Chemical | Electronics | Total | |||||||||||||||||||
Three months ended September 30, 2012 | ||||||||||||||||||||||||
Three months ended December 31, 2012 | ||||||||||||||||||||||||
Revenue from external customers | $ | 258,974 | $ | 125,699 | $ | 384,673 | $ | 266,061 | $ | 40,461 | $ | 306,522 | ||||||||||||
Segment operating income (loss) | $ | 34,879 | $ | (123,832 | ) | $ | (88,953 | ) | $ | 5,716 | $ | (197,573 | ) | $ | (191,857 | ) | ||||||||
Three months ended September 30, 2011 | ||||||||||||||||||||||||
Three months ended December 31, 2011 | ||||||||||||||||||||||||
Revenue from external customers | $ | 252,232 | $ | 220,457 | $ | 472,689 | $ | 175,127 | $ | 277,816 | $ | 452,943 | ||||||||||||
Segment operating income (loss) | $ | 28,848 | $ | 2,233 | $ | 31,081 | $ | 24,381 | $ | (58,135 | ) | $ | (33,754 | ) | ||||||||||
Six months ended September 30, 2012 | ||||||||||||||||||||||||
Nine months ended December 31, 2012 | ||||||||||||||||||||||||
Revenue from external customers | $ | 548,938 | $ | 352,974 | $ | 901,912 | $ | 814,999 | $ | 393,435 | $ | 1,208,434 | ||||||||||||
Segment operating income (loss) | $ | 100,065 | $ | (202,399 | ) | $ | (102,334 | ) | $ | 105,780 | $ | (399,971 | ) | $ | (294,191 | ) | ||||||||
Six months ended September 30, 2011 | ||||||||||||||||||||||||
Nine months ended December 31, 2011 | ||||||||||||||||||||||||
Revenue from external customers | $ | 545,236 | $ | 346,515 | $ | 891,751 | $ | 720,363 | $ | 624,331 | $ | 1,344,694 | ||||||||||||
Segment operating income (loss) | $ | 53,549 | $ | (73,490 | ) | $ | (19,941 | ) | $ | 77,930 | $ | (131,625 | ) | $ | (53,695 | ) | ||||||||
Total assets at September 30, 2012 | $ | 777,374 | $ | 418,134 | $ | 1,195,508 | ||||||||||||||||||
Total assets at December 31, 2012 | $ | 737,687 | $ | 402,596 | $ | 1,140,283 | ||||||||||||||||||
Total assets at March 31, 2012 | $ | 540,349 | $ | 796,101 | $ | 1,336,450 | $ | 540,349 | $ | 796,101 | $ | 1,336,450 |
Shares | Weighted Average Exercise Price | |||||||
Outstanding - April 1, 2012 | - | $ | - | |||||
Granted | 5,000,000 | 0.005 | ||||||
Exercised | - | - | ||||||
Cancelled, Forfeited, or Expired | - | - | ||||||
Outstanding - December 31, 2012 | 5,000,000 | $ | 0.005 | |||||
Exercisable - December 31, 2012 | 5,000,000 | $ | 0.005 |
Exercise Price | Number Outstanding | Weighted Average Remaining Contractual Life (in Years) | Weighted Average Exercise Price | Number Exercisable | ||||||||||||||
$ | 0.005 | 5,000,000 | 4.97 | $ | 0.005 | 5,000,000 |
By: | /s/ Andre' DiMino | ||
Andre' DiMino, Chief Executive | |||
Officer and Chief Financial Officer | |||