UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2004
OR
o TRANSITION REPORT PURSUANT TO 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
COMMISSION FILE NUMBER 000-32621
INTAC INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
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NEVADA |
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98-0336945 |
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(State or other jurisdiction of |
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(IRS Employer Identification No.) |
Unit 6-7, 32/F., Laws Commercial Plaza
788 Cheung Sha Wan Road
Kowloon, Hong Kong
(Address of principal executive offices)
011 (852) 2385.8789
(Issuer’s telephone number)
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. ý Yes o No.
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes o No ý
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 20,989,455 shares of $.001 par value Common Stock outstanding as of May 17, 2004.
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
INTAC INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(expressed in U.S. Dollars)
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March 31, |
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December 31, |
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(Unaudited) |
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Assets |
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Current assets |
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Cash and cash equivalents |
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$ |
1,451,928 |
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$ |
2,810,574 |
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Restricted cash |
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2,500,000 |
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2,800,000 |
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Trade accounts receivable (net of allowance for doubtful accounts of $0, respectively) |
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3,186,775 |
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4,000,286 |
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Inventories |
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776,258 |
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232,371 |
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Foreign sales tax receivable |
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10,900 |
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335,993 |
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Advances to officers of subsidiaries and employees |
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876,276 |
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— |
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Deposits paid |
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355,092 |
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250,133 |
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Total current assets |
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9,157,229 |
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10,429,357 |
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Equipment, net |
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979,685 |
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883,061 |
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Other assets |
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656,622 |
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499,682 |
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Advances to officers of subsidiaries and employees |
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— |
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346,090 |
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Internet portal database gateway, net |
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289,263 |
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304,487 |
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Goodwill |
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59,021 |
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59,021 |
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Total assets |
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$ |
11,141,820 |
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$ |
12,521,698 |
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Liabilities and Stockholders’ Equity |
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Current liabilities |
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Trade accounts payable |
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$ |
1,157,716 |
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$ |
1,577,408 |
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Short-term note payable to bank |
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2,435,895 |
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2,728,202 |
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Accrued expenses |
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438,199 |
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480,069 |
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Due to shareholder |
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98,665 |
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99,084 |
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Deposits received |
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222,746 |
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221,389 |
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Total current liabilities |
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4,353,221 |
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5,106,152 |
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Minority interest in consolidated joint venture |
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581,749 |
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695,408 |
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Stockholders’ Equity |
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Preferred stock, $0.001 par value, 10,000,000 shares authorized; none issued and outstanding |
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— |
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— |
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Common stock, $0.001 par value, 100,000,000 shares authorized; 20,189,455 shares issued and outstanding |
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20,189 |
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20,189 |
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Additional paid-in capital |
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8,121,133 |
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8,062,801 |
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Accumulated deficit |
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(2,082,376 |
) |
(1,563,505 |
) |
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Accumulated other comprehensive income |
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147,904 |
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200,653 |
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Total stockholders’ equity |
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6,206,850 |
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6,720,138 |
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Total liabilities and stockholders’ equity |
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$ |
11,141,820 |
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$ |
12,521,698 |
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The accompanying notes are an integral part of these consolidated financial statements.
2
INTAC INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(expressed in U.S. Dollars)
(Unaudited)
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Three Months Ended March 31, |
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2004 |
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2003 |
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Revenues |
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$ |
8,435,170 |
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$ |
8,012,092 |
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Cost of goods sold |
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8,075,767 |
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7,784,824 |
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Gross profit |
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359,403 |
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227,268 |
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Operating expenses |
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Distribution expenses |
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130,412 |
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68,507 |
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Selling, general and administrative expenses |
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871,087 |
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651,437 |
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Total operating expenses |
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1,001,499 |
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719,944 |
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Loss from operations |
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(642,096 |
) |
(492,676 |
) |
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Other income (expenses) |
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Foreign currency exchange gain (loss) |
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29,760 |
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(4,397 |
) |
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Interest expense, net |
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(25,549 |
) |
(3,418 |
) |
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Minority interest in loss of consolidated joint venture |
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113,659 |
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— |
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Other income, net |
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5,355 |
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8,295 |
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Total other income (expenses) |
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123,225 |
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480 |
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Loss before income taxes |
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(518,871 |
) |
(492,196 |
) |
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Income taxes |
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— |
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— |
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Net loss |
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$ |
(518,871 |
) |
$ |
(492,196 |
) |
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Net loss per share – basic and diluted |
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$ |
(0.03 |
) |
$ |
(0.03 |
) |
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Weighted average number of shares outstanding - basic and diluted |
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20,189,455 |
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19,189,455 |
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The accompanying notes are an integral part of these consolidated financial statements.
3
INTAC INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(expressed in U.S. Dollars)
(Unaudited)
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Three Months Ended March 31, |
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2004 |
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2003 |
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Cash flow from operating activities: |
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&nb | ||||