UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
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(Mark One) |
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ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended September 30, 2002
Or
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o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from To
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MFIC CORPORATION |
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(Exact name of registrant as specified in its charter) |
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Delaware |
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04-2793022 |
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(State or Other
Jurisdiction |
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(I.R.S. Employer |
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30 Ossipee Road, P.O. Box 9101, Newton, Massachusetts 02464 |
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(Address of principal Executive Offices) (Zip Code) |
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617-969-5452 |
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(Registrant’s Telephone Number, Including Area Code) |
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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 ý No o
Registrant had 7,444,618 shares of common stock, par value $.01 per share, outstanding on November 8, 2002.
INDEX
2
MFIC CORPORATION
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September
30, |
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December
31, |
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(unaudited) |
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ASSETS |
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Current Assets: |
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Cash and cash equivalents |
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$ |
166,682 |
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$ |
87,386 |
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Accounts receivable (less allowance for doubtful accounts of $55,136 and $38,248 at September 30, 2002 and at December 31, 2001, respectively) |
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2,178,511 |
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2,707,136 |
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Other receivables |
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60,975 |
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50,798 |
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Inventories |
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4,100,558 |
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3,962,745 |
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Prepaid expenses |
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206,389 |
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180,687 |
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Other current assets |
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49,535 |
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134,190 |
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Note receivable – current |
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16,429 |
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17,798 |
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Total current assets |
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6,779,079 |
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7,140,740 |
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Property |
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Furniture, fixtures and office equipment |
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266,410 |
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194,365 |
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Machinery and equipment |
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431,576 |
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459,880 |
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Leasehold improvements |
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126,849 |
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126,849 |
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Total property |
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824,835 |
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781,094 |
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Less: accumulated depreciation & amortization |
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(337,177 |
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(221,331 |
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Net property and equipment |
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487,658 |
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559,763 |
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Note receivable – long term |
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75,297 |
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88,988 |
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Goodwill (net of accumulated amortization of $4,064,459 and $1,403,050 at September 30, 2002 and December 31, 2001, respectively and a charge for Goodwill impairment of $2,661,409 at March 31, 2002) |
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2,100,000 |
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4,761,409 |
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Patents, licenses and other intangible assets (net of accumulated amortization of $729,284 at September 30, 2002 and $662,085 at December 31, 2001) |
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60,728 |
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88,491 |
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Total assets |
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$ |
9,502,762 |
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$ |
12,639,391 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Line of credit |
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$ |
2,345,210 |
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$ |
2,535,792 |
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Accounts payable and accrued expenses |
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1,846,213 |
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1,989,148 |
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Accrued interest – related party |
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19,292 |
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44,635 |
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Accrued compensation and vacation pay |
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81,442 |
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109,619 |
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Customer advances |
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383,818 |
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536,867 |
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Current portion of long term debt—related party |
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75,000 |
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75,000 |
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Current portion of note payable |
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95,004 |
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95,004 |
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Notes payable – other |
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350,000 |
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350,000 |
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Total current liabilities – |
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5,195,979 |
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5,736,065 |
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Term note – net of current portion |
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82,486 |
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153,739 |
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Long term debt – net of current portion – related party |
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100,000 |
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162,500 |
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Stockholders’ equity |
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Common stock, par value $.01 per share, 20,000,000 shares authorized; 7,705,064 and 7,643,981 shares issued and outstanding at September 30, 2002 and December 31, 2001, respectively |
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77,050 |
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76,440 |
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Additional paid-in capital |
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12,945,521 |
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12,916,876 |
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Accumulated deficit |
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(8,210,573 |
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(5,718,528 |
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Less: Treasury stock, at cost, 260,446 shares at both September 30, 2002 and December 31, 2001, respectively |
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(687,701 |
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(687,701 |
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Total stockholders’ equity |
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4,124,297 |
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6,587,087 |
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Total liabilities and stockholders’ equity |
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$ |
9,502,762 |
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$ |
12,639,391 |
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See notes to condensed consolidated financial statements.
3
MFIC CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
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Three
months |
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Three
months |
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Nine months |
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Nine
months |
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(unaudited) |
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(unaudited) |
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(unaudited) |
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(unaudited) |
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Revenues |
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$ |
3,599,687 |
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$ |
3,753,750 |
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$ |
10,825,761 |
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$ |
11,640,123 |
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Cost of goods sold |
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2,029,248 |
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2,104,513 |
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6,033,361 |
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6,291,412 |
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Gross profit |
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1,570,439 |
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1,649,237 |
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4,792,400 |
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5,348,711 |
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Operating expenses: |
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Selling |
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733,427 |
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833,926 |
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2,236,210 |
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2,298,093 |
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Research and development |
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202,465 |
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249,323 |
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644,921 |
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620,705 |
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General and administrative |
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575,398 |
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655,039 |
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1,607,082 |
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1,885,927 |
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Amortization of goodwill |
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— |
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105,000 |
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— |
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317,000 |
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Total operating expenses |
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1,511,290 |
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1,843,288 |
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4,488,213 |
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5,121,725 |
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Other: |
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Loss on sale of Ball Mill operation |
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— |
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— |
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— |
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