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SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549


FORM 10-Q


(Mark One)

x Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the Quarterly period ended June 30, 2002

or

¨ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from ______ to ______


Commission file number 0-14691


SENETEK PLC
(Exact name of registrant as specified in its charter)
         
England   77-0039728
 
(State or other jurisdiction of
Incorporation or organization)		   (I.R.S. Employer
Identification No.)
 
 
620 Airpark Road, Napa, California   94558
 
(Address of principal executive offices)   (Zip Code)
 
Registrant’s telephone no. including area code (707) 226-3900

  NOT APPLICABLE  
(former name, former address and former fiscal year, if changes since last report)

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 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.

  Yes x   No ¨  

Indicate number of shares outstanding of each of the issuer’s classes of common stock, as of the latest date practicable.

At July 31, 2002, there were 59,052,153 of the Registrant’s Ordinary shares outstanding

 

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SENETEK PLC AND SUBSIDIARIES

INDEX TO FORM 10-Q
QUARTER ENDED JUNE 30, 2002
     
PART I.    FINANCIAL INFORMATION Page
   
     
Item 1  -  Financial Statements  
     
  Unaudited Consolidated Statements of Operations
Three Months Ended June 30, 2002 and June 30, 2001
Six Months Ended June 30, 2002 and June 30, 2001		 1
     
  Consolidated Balance Sheets
June 30, 2002 (unaudited) and December 31, 2001		 2
     
  Unaudited Consolidated Statement of Stockholders’ Deficit
and Comprehensive Loss Six Months ended June 30, 2002		 3
     
  Unaudited Consolidated Statements of Cash Flows
Six Months Ended June 30, 2002 and June 30, 2001		 4
     
  Notes to the Unaudited Consolidated Financial Statements 6
     
  Item 2  -  Management’s Discussion and Analysis of Financial
Condition and Results of Operations		 9
    14
  Item 3 - Quantitative and Qualitative Disclosures about Market Risk
     
PART II.    OTHER INFORMATION 15
 
  Item 4 - Submission of Matters to a Vote of Security Holders 15
 
  Item 6 - Exhibits and Reports on Form 8-K 15
     
SIGNATURES 15
 

Table of Contents
Part I Financial Information
 
SENETEK PLC AND SUBSIDIARIES
   
CONSOLIDATED STATEMENTS OF OPERATIONS  
(in thousands except per share data) (Unaudited)                          
                           
  Three Months Ended   Six Months Ended
  June 30,   June 30,
 
   
 
  2002     2001   2002      2001
 
 
   
 
 
                           
Revenues:                          
           Product Sales $ 107   $ 1,111     $ 1,174   $ 1,953  
           Royalties & Licensing   3,191     1,322       4,698     2,243  
 
 
   
 
 
Total Revenue   3,298     2,433       5,872     4,196  
           Cost of Sales - Products   38     234       281     506  
           Cost of Sales - Royalty   133     122       294     285  
 
 
   
 
 
           Total Cost of Sales   171     356       575     791  
                           
           Gross Profit   3,127     2,077       5,297     3,405  
                           
                           
Operating Expenses:                          
           Research & Development   207     58       368     169  
           General & Administration   1,401     1,347       2,562     2,632  
 
 
   
 
 
           Total Operating Expenses   1,608     1,405       2,930     2,801  
 
 
   
 
 
Income from Operations   1,519     672       2,367     604  
                           
                           
Other income (expense):                          
           Interest Income   9     6       17     12  
           Interest Expense (Including amortization of debt discount)   (364 )   (532 )     (729 )   (1,048 )
           Other   2     (58 )     24     (73 )
 
 
   
 
 
           Net income(loss) before taxation   1,166     88       1,679     (505 )
                           
           Provision for Income Taxes   (4 )   —       5     —  
 
 
   
 
 
           Net Income   1,170     88       1,674     (505 )
                           
           Basic and diluted income(loss)                          
           per Ordinary share outstanding $ 0.02   $  0.00     $  0.03   $ (0.01 )
                           
                           
           Weighted average                          
           Ordinary shares                          
           Outstanding   59,052     58,473       59,052     58,452  
                           
                           
See accompanying notes to unaudited consolidated financial statements.                          

1

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SENETEK PLC AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (in thousands)  
   
   
  June 30,   December 31,
  2002   2001
  (unaudited)        
 
 
             
ASSETS            
     Current Assets:            
     Cash and Cash Equivalents $ 2,216   $ 1,814  
     Trade Receivables            
     (net of provisions of $107,000 at June 30, 2002 and $127,000 at            
     December 31, 2001)   2,134     1,892  
     Non-Trade Receivables            
     (net of provisions of $136,000 at June 30, 2002 and            
     December 31, 2001)   62     62  
     Inventory            
     (net of provisions of $72,000 at June 30, 2002 and            
     December 31, 2001)   349     312  
     Prepaids and Deposits   96     122  
 
 
 
Total Current Assets   4,857     4,202  
             
             
     Property   Equipment, net   3,260     3,299  
     Goodwill - net   1,308     1,308  
 
 
 
             
TOTAL ASSETS $ 9,425   $ 8,809  
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)            
Current Liabilities            
     Accounts Payable   657     962  
     Accrued Liabilities   739     1,189  
     Short Term Debt   —     20  
 
 
 
Total Current Liabilities   1,396     2,171  
             
             
Long Term Liabilities            
     Notes Payable            
     (net of unamortized discount of $1,550,000 at June 30, 2002            
     and $1,982,000 at December 31, 2001)   5,839     5,407  
     Deferred License Fees   1,734     2,621  
             
Commitments and Contingencies            
             
Stockholders’ Equity (Deficit):            
     Ordinary shares $0.07 (5 pence) par value:            
     Authorized shares: 100,000,000            
     Issued and outstanding shares:            
       June 30, 2002 - 59,052,153            
       December 31, 2001 - 59,052,153   4,763     4,763  
             
             
Share Premium   82,100     81,926  
Accumulated Deficit   (86,425 )   (88,099 )
Equity Adjustment from Foreign Currency Translation   18     20  
 
 
 
             
Total Stockholders’ Equity (Deficit) $ 456   $ (1,390 )
 
 
 
             
Total Liabilities and Stockholders’ Equity (Deficit) $ 9,425   $ 8,809  
 
 
 
   
   
See accompanying notes to unaudited consolidated financial statements.  

2

 

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SENETEK PLC AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY (DEFICIT) AND COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED JUNE 30, 2002
(in thousands, except shares outstanding) (unaudited)

 

                            Accumulated          
                    Other        
                    Comprehensive        
                    Income        
  Ordinary   Shares   Share   Accumulated     Currency     Net  
  Shares   Amount   Premium   Deficit     Translation (1)     Equity (Deficit)  
 
 
 
 
   
   
 
   
   
   
Balances, January 1, 2002: 59,052,153   $ 4,763   $ 81,926   $ (88,099 )   $ 20     $ (1,390 )
   
                                       
Fair value of options issued to Consultants             174                     174  
                                       
                                       
Comprehensive Income                                      
     Net Income —     —     —     1,674       —       1,674  
     Translation loss, net of tax —     —     —     —       (2 )     (2 )
 
 
 
 
   
   
 
Total Comprehensive Income                                   1,672  
 
 
 
 
   
   
 
Balances, June 30, 2002 59,052,153   $ 4,763   $ 82,100   $ (86,425 )   $ 18     $ 456  
 
 
 
 
   
   
 

(1)     For the three months ended June 30, 2002 the translation loss was $nil and and comprehensive income was $1,170.

For the six months ended June 30, 2001 the translation loss was $2 and comprehensive income was $507. For the three months ended June 30, 2001 the translation gain was $2 and the comprehensive income was $86.

See accompanying notes to unaudited consolidated financial statements.

3

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SENETEK PLC AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands) (unaudited)

    Six Months Ended
    June 30,
   
 
    2002     2001  
   
   
 
CASH FLOWS FROM OPERATING ACTIVITIES: