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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q
 
 x
Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended March 31, 2005
 
    o
Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
For the transition period from                         to                      
 
Commission File No.: 0-22693
 
InfoTech USA, Inc.
(Exact name of registrant as specified in its charter)
 
Delaware
(State or other jurisdiction of
incorporation or organization) 
11-2889809
(I.R.S. Employer
Identification No.)
 
7 Kingsbridge Road, Fairfield, New Jersey  07004
(Address, including zip code, of registrant’s principal executive offices)
 
Registrant’s telephone number, including area code: (973) 227-8772
 
 
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  o
 
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).  Yes  o  No  x
 
As of May 13, 2005, 4,895,998 shares of our common stock were outstanding.
 
 

 




 
InfoTech USA, Inc.
 
Table of Contents
 
 

 
Item
Page
     
Part I
Financial Information
3
 
Item 1  Consolidated Condensed Financial Statements
3
 
Item 2  Management’s Discussion and Analysis of Financial Condition and Results of Operations
10
 
Item 3  Quantitative and Qualitative Disclosures About Market Risk
15
 
Item 4  Controls and Procedures
15
     
Part II
Other Information
16
 
Item 1  Legal Proceedings
16
 
Item 4  Submission of Matters to a Vote of Security Holders
16
 
Item 6  Exhibits
16
 
Signature
    
Exhibits
    
 

 
 

 


2
 
Part I  Financial Information
Item 1  Consolidated Condensed Financial Statements
 
 
InfoTech USA, Inc. and Subsidiaries
Consolidated Condensed Balance Sheets
(in thousands, except par value)
   
March 31, 2005
  
September 30, 2004
  
   
(unaudited)
      
Assets
          
Current assets:
          
Cash and cash equivalents
  
$
442
  
$
291
  
Accounts receivable, net of allowance for doubtful accounts
of $85 and $97
    
2,692
    
3,377
  
Inventories
    
287
    
113
  
Note receivable - Parent Company
    
1,000
    
1,000
  
Other current assets
    
290
    
414
  
Total current assets
    
4,711
    
5,195
  
Property, equipment and improvements, net
    
159
    
183
  
Goodwill, net
    
1,453
    
1,453
  
Other assets
    
191
    
174
  
Total assets
  
$
6,514
  
$
7,005
  
               
Liabilities and Stockholders’ Equity
              
Current liabilities:
              
Line of credit - Wells Fargo
  
$
-
  
$
812
  
Amounts due to Parent Company
    
104
    
95
  
Accounts payable
    
481
    
264
  
Accrued expenses and other liabilities
    
1,002
    
921
  
Total liabilities
    
1,587
    
2,092
  
               
Commitments and contingencies
    
−
    
−
  
               
Stockholders’ equity:
              
Preferred shares:
              
Authorized 5,000 shares, no par value; none issued
    
−
    
−
  
Common shares:
              
Authorized 80,000 shares, $.01 par value; 5,757 shares issued; 4,896 shares outstanding
    
58
    
58
  
Additional paid-in capital
    
6,653
    
6,653
  
Accumulated deficit
    
(866
)
  
(880
)
Treasury stock, 861 shares, carried at cost
    
(918
)
  
(918
)
Total stockholders’ equity
    
4,927
    
4,913
  
Total liabilities and stockholders’ equity
  
$
6,514
$
7,005
 
See the accompanying notes to consolidated condensed financial statements.
 

3

 
InfoTech USA, Inc. and Subsidiaries
Consolidated Condensed Statements of Operations
(in thousands, except per share data)
(unaudited)
   
For the three months ended
March 31
  
For the six months ended
March 31
  
     
2005
 
 
2004
 
 
2005
 
 
2004
  
Revenue:
                          
Product revenue
  
$
3,190
  
$
3,613
  
$
7,525
  
$
6,534
  
Service revenue
    
532
    
907
    
1,241
    
1,714
  
Total revenue
    
3,722
    
4,520
    
8,766
    
8,248
  
                           
Cost of sales:
                          
Cost of products sold
    
2,601
    
3,131
    
6,137
   
5,618
  
Cost of services sold
    
453
    
610
    
867
    
1,151
  
Total cost of products and services sold
    
3,054
    
3,741
    
7,004
    
6,769
  
                           
Gross profit
    
668
    
779
    
1,762
    
1,479
  
                           
Selling, general and administrative expenses
    
692
    
748
    
1,685
    
1,603
  
Depreciation and amortization
    
23
    
46
    
45
    
92
  
                           
Income (loss) from operations
    
(47
)
  
(15
)
  
32
    
(216
)
Other expense
   
−
    
13
    
−
    
19
  
Interest expense (income)
    
16
    
(37
)
  
28
    
(78
)
                           
(Loss) income before income tax (benefit) expense
    
(63
)
  
9
    
4
    
(157
)
Income tax (benefit) expense
    
(15
)
  
4
    
(10
)
  
(52
)