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UNITED STATES
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, 2004
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: 0-30709
POWERCOLD CORPORATION
(Exact name of registrant as specified in its charter)
NEVADA
23-2582701
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
PO Box 1239
115 CANFIELD ROAD
LA VERNIA, TEXAS
78121
(Address of principal executive offices)
(Zip Code)
830-779-5213
(Registrant's telephone number, including area code)
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. [X] Yes [ ] No
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. [ ] Yes [ ] No
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Common Stock, par value $0.001 – 22,367,792 shares outstanding at June 30, 2004.
SEC 1296 (1-04) Potential persons who are required to respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB number.
POWERCOLD CORPORATION AND SUBSIDIARIES
FORM 10Q
JUNE 30, 2004
INDEX
Page
PART I. FINANCIAL INFORMATION
Item 1:
Consolidated Financial Statements
Consolidated Balance Sheets
3
Consolidated Statements of Operations
4
Consolidated Statements of Cash Flows
6
Condensed Notes to Consolidated Financial Statements
8
Item 2:
Management's Discussion and Analysis of
Financial Condition and Results of Operations.
11
Item 3:
Quantitative and Qualitative Disclosures About Market Risk.
18
Item 4.
Controls and Procedures.
18
PART II. OTHER INFORMATION
Item 1.
Legal Proceedings.
21
Item 2.
Changes in Securities.
21
Item 3.
Defaults Upon Senior Securities.
21
Item 4.
Submission of Matters to a Vote of Security Holders.
21
Item 5.
Other Information.
21
Item 6.
Exhibits and Reports on Form 8-K.
21
Signature
22
Certifications
23
POWERCOLD CORPORATION AND SUBSIDIARIES
FORM 10Q
JUNE 30, 2004
PART I - FINANCIAL INFORMATION
ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS
POWERCOLD CORPORATION | ||||||||||||||
CONSOLIDATED BALANCE SHEETS |
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June 30, | December 31, | |||||||||||||
2004 | 2003 | 2002 | ||||||||||||
(Unaudited) |
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ASSETS | ||||||||||||||
CURRENT ASSETS | ||||||||||||||
Cash | $ | 454,431 | $ | 374,678 | $ | 88,613 | ||||||||
Trade accounts receivable, net of allowance | 4,984,880 | 2,388,495 | 296,179 | |||||||||||
Costs and estimated earnings in excess | ||||||||||||||
on contracts in progress | - | 245,535 | - | |||||||||||
Inventory | 135,345 | 11,156 | 180,433 | |||||||||||
Prepaid expenses | 161,382 | 100,118 | 3,875 | |||||||||||
Total Current Assets | 5,736,038 | 3,119,982 | 569,100 | |||||||||||
OTHER ASSETS | ||||||||||||||
Property and equipment, net | 239,449 | 135,858 | 130,598 | |||||||||||
Patent rights and related technology, net | 1,266,113 | 1,306,731 | 926,716 | |||||||||||
Securities available for sale | 19,317 | 19,317 | 38,800 | |||||||||||
Deposits | 10,828 | 10,828 | 5,661 | |||||||||||
Total Other Assets | 1,535,707 | 1,472,734 | 1,101,775 | |||||||||||
NET ASSETS FROM DISCONTINUED OPERATIONS | - | - | 13,675 | |||||||||||
TOTAL ASSETS | $ | 7,271,745 | $ | 4,592,716 | $ | 1,684,550 | ||||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||||||||
CURRENT LIABILITIES | ||||||||||||||
Accounts payable and accrued expenses | $ | 1,202,625 | $ | 1,253,030 | $ | 335,250 | ||||||||
Billings in excess of costs and estimated earnings | ||||||||||||||
on contracts in progress | 1,888,120 | 947,807 | - | |||||||||||
Commissions and royalty payable | 8,180 | 8,180 | 55,066 | |||||||||||
Accounts payable, related party | 389,236 | 417,236 | 196,760 | |||||||||||
Convertible debt, net of discounts | 1,684,014 | 334,014 | 34,014 | |||||||||||
Current portion of capital lease payable | - | 632 | 3,321 | |||||||||||
Total Current Liabilities | 5,172,175 | 2,960,899 | 624,411 | |||||||||||
CAPITAL LEASE PAYABLE, net of current portion | - | - | 600 | |||||||||||
COMMITMENTS AND CONTINGENCIES | 69,417 | 69,417 | 277,903 | |||||||||||
STOCKHOLDERS' EQUITY | ||||||||||||||
Convertible preferred stock, Series A, $0.001 | ||||||||||||||
par value; 5,000,000 shares authorized, no | ||||||||||||||
shares issued and outstanding | - | - | - | |||||||||||
Common stock, $0.001 par value; 200,000,000 | ||||||||||||||
shares authorized, 22,367,792, 21,576,750 and 18,442,066, | ||||||||||||||
shares issued and outstanding, respectively | 22,368 | 21,578 | 18,442 | |||||||||||
Additional paid-in capital | 17,753,788 | 16,795,953 | 13,644,780 | |||||||||||
Stock options and warrants | 898,213 | 588,507 | 504,998 | |||||||||||
Accumulated deficit | (16,663,533) | (15,862,955) | (13,425,384) | |||||||||||
Accumulated other comprehensive income | 19,317 | 19,317 | 38,800 | |||||||||||
Total Stockholders' Equity | 2,030,153 | 1,562,399 | 781,636 | |||||||||||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 7,271,745 | $ | 4,592,716 | $ | 1,684,550 | ||||||||
The accompanying notes are an integral part of these financial statements.
POWERCOLD CORPORATION | ||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||||||||
Three Months Ended June 30, | ||||||||
2004 | 2003 | 2002 | ||||||
(Unaudited) | (Unaudited) | (Unaudited) | ||||||
REVENUES | ||||||||
Contracts including equipment | $ | 2,125,955 | - | - | ||||
Equipment | 235,155 | 2,138,976 | 495,740 | |||||
Total Revenues | 2,361,110 | 2,138,976 | 495,740 | |||||
COST OF REVENUES | ||||||||