SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2003
OR
[ ] TRANSACTION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission File No. 0-17629
ADM TRONICS UNLIMITED, INC.
(Exact name of registrant as specified in its Charter)
Delaware 22-1896032
(State or Other Jurisdiction (I.R.S. Employer Identifi-
of Incorporation or organization) cation Number)
224-S Pegasus Ave., Northvale, New Jersey 07647
(Address of Principal Executive Offices)
Issuer's Telephone Number, including area code: (201) 767-6040
Check whether the Issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for
Such shorter period that the Issuer was required to file such reports),
And (2) has been subject to the filing requirements for the past 90 days:
YES X NO ______
State the number of shares outstanding of each of the Issuer's classes of
common equity, as of the latest practicable date:
50,382,037 shares of Common Stock, $.0005 par value,
as of October 22, 2003
ADM TRONICS UNLIMITED, INC.
INDEX
Page Number
Part I. Financial Information
Item 1. Consolidated Financial Statements:
Consolidated Balance Sheets - September 30, 2003
and March 31, 2003 2
Consolidated Statements of Operations - For the
three months and six months ended September
30, 2003 and 2002 3
Consolidated Statement of Changes in Stockholders'
Equity - For the six months ended September 30, 2003 3
Consolidated Statements of Cash Flows - For the
six months ended September 30, 2003 and 2002 4
Notes to Consolidated Financial Statements 5
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 6-7
1
ADM TRONICS UNLIMITED, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
SEPTEMBER MARCH
ASSETS 30, 2003 31, 2003
Current assets:
Cash and equivalents $ 75,719 $ 49,765
Accounts receivable - trade, less allowance
for doubtful accounts of $4,593 87,323 75,622
Inventories:
Raw materials and supplies 142,069 201,409
Finished goods 45,101 46,928
Equipment held for sale 390,831 404,771
Other current assets 57,948 57,348
Total current assets 798,991 835,843
Property and equipment 10,151 24,155
Equipment in use and under lease agreements -
At cost net of accumulated depreciation of
$587,207 and $631,365 respectively 243,359 306,860
Loan receivable from officer, bearing
interest at 3% per annum, unsecured 49,188 49,891
Other assets 92,817 95,621
Total assets 1,194,506 1,312,370
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable - trade 184,335 200,631
Accrued expenses 38,890 59,579
Total current liabilities 223,225 260,210
Note payable, long-term portion 135,000 135,000
Stockholders' equity 836,281 917,160
Total liabilities and
stockholders' equity $1,194,506 $1,312,370
2
ADM TRONICS UNLIMITED, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
2003 2002 2003 2002
Revenues $321,475 $175,131 $593,783 $ 428,741
Costs and expenses:
Cost of sales 172,321 75,592 331,574 154,227
Selling, general and
Administrative 182,621 274,589 343,254 523,566
Total costs and expenses 354,942 350,181 674,828 677,793
Operating loss (33,467) (175,050) (81,045) (249,052)
Other income:
Interest and other income 77 63,550 166 69,443
Net loss (33,390) (111,500) (80,879) (179,609)
Net loss per share $(0.001) $(0.002) $(0.002) $(0.004)
ADM TRONICS UNLIMITED, INC.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2003
(UNAUDITED)
Preferred Common
Shares Shares Capital
5,000,000 150,000,000 in
Authorized Authorized excess
$.01 Par $.0005 Par of Par Accumulated
Value Par Value Value Value Deficit Total
Balances -
March 31,
2003 - 50,382,037 $25,191 $6,792,118 $(5,900,149) $917,160
Net loss for
the period
ended
September 30,
2003 (80,879) (80,879)
Balances -
September 30,
2003 - 50,382,037 $25,191 $6,792,118 $(5,981,028) $836,281
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ADM TRONICS UNLIMITED, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
SIX MONTHS ENDED
SEPTEMBER 30,
2003 2002
Cash flows from Operating activities:
Net loss $( 80,881) $(179,609)
Adjustments to reconcile net income (loss)
to net cash from operating activities:
Depreciation and amortization 14,003 84,761
Changes in operating assets and liabilities:
Accounts receivable - trade (10,405) 82,476
Inventories 62,049 48,272
Other current assets (600) 5,009
Equipment in use or under lease 63,502 (18,195)
Equipment held for sale 13,940 64,200
Other assets 3,469 (4,324)
Accounts payable - trade (22,980) (7,134)
Accrued expenses and other (16,143) (21,314)
Net cash flows provided by
operating activities 25,954 54,142
Cash flows from Investing activities:
Purchases of property and equipment - (68,843)
Repayments of loan to officer - 2,600
Net cash flows provided by (used in)
investing activities - (66,243)
Cash flows from Financing activities:
Payments on notes payable - -
Net change in cash and cash equivalents $ 25,954 $(12,101)
Cash and cash equivalents--beginning of year $ 49,765 $ 51,565
Cash and cash equivalents--end of period $ 75,719 $ 39,464
Supplemental disclosure of cash flow activities:
Interest paid - -
4
ADM TRONICS UNLIMITED, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1-Basis of Presentation:
The consolidated balance sheet at the end of the preceding fiscal year has
been derived from the audited consolidated balance sheet contained in the
Company's annual report on Form 10-KSB for the fiscal year ended March 31,
2003 (the "Form 10-KSB") and is presented for comparative purposes. All
other financial statements are unaudited. In the opinion of management,
all adjustments which include only normal recurring adjustments necessary
to present fairly the financial position, results of operations and changes
in financial positions for all periods presented have been made. The
results of operations for interim periods are not necessarily indicative of
the operating results for the full year.
Footnote disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been omitted
in accordance with the published rules and regulations of the Securities and
Exchange Commission. These consolidated financial statements should be read
in conjunction with the financial statements and notes thereto included in
the Form 10-KSB.
Note 2. Segment Information
Information about segment information is as follows:
Six Months Ended September 30, 2003: CHEMICAL MEDICAL TOTAL
Revenues from external customers 466,747 127,036 593,783
Segment profit (loss) (58,317) (22,502) (80,879)
Six Months Ended September 30, 2002:
Revenues from external customers 385,644 43,097 428,741
Segment profit (loss) 94,576 (274,185) (179,609)
Three Months Ended September 30, 2003:
Revenues from external customers 225,530 95,945 175,132
Segment profit (loss) (35,222) 1,832 (33,390)
Three Months Ended September 30, 2002:
Revenues from external customers 149,589 25,543 321,475
Segment profit (loss) (97,359) (208,859) (111,500)
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Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Liquidity and Capital Resources
At September 30, 2003 the Company had cash and equivalents of $75,719 as
compared to $49,765 at March 31, 2003. This increase was the result of net
cash flows provided by operating activities of $25,954.
Operating Activities
Net cash flows provided by operating activities decreased $28,188 to $25,954
for the six months ended September 30, 2002 as compared to net cash flow
of $54,142 for the six months ended September 30, 2002. This decrease was
primarily the result of a net decrease in operating assets offset primarily
by a reduced loss for the six months ended September 30, 2003 of $80,879 as
compared to a net loss of $179,609 for the six months ended September 30,
2002.
Investing Activities
There were no investing activities during the period.
Financing Activities
There were no financing activities during the period.
The Company does not have any material external sources of liquidity or
unused sources of funds.
Results of Operations
Quarter Ended September 30, 2003
Revenues
Revenues were $321,475 in 2003 as compared to $175,131 in 2002 representing
an increase of $146,344 or 84%. This increase was the result of an increase
in revenues from the Company's medical electronic activities of $70,403 and
an increase in chemical revenues of $75,941.
Gross Profit
Gross profit of $149,154 in 2003 was $49,615 or 50% above the gross profit
of 99,539 in 2002. Gross profit was 46% of revenues in 2003 as compared
with 57% of revenues in 2002. The decrease in gross profit margin was
primarily due to the product mix of sales with higher sales of products with
a lower gross margin.
Operating Loss
Operating loss in 2003 was $33,467 compared to $175,050 in 2002. Selling,
general and administrative expenses decreased by $91,968 or 50% in 2003
primarily due to decreases in personnel and overhead expenses offset by
legal and professional fees incurred in the period due to litigation.
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Other Income
Other income in 2003 was $77 as compared to $63,550 in 2002. The decrease
was primarily due to reduced income from a joint venture and reduced interest
income.
Results of Operations
Six Months Ended September 30, 2003
Revenues
Revenues were $593,783 in 2003 as compared to $428,741 in 2002 representing
an increase of $165,042 or 39%. Revenues from the Company's medical
electronics activities increased $83,939 and chemical revenues increased
$81,103.
Gross Profit
Gross profit of $262,209 in 2003 was $12,305 or 4% lower than the gross profit
of $274,514 in 2002. Gross profit was 44% of revenues in 2003 and 64% in
2002. The decrease in gross profit margin is due to the mix in product sales
with higher sales of products with a lower gross margin.
Operating Income (Loss)
Operating loss was $81,045 in 2003 compared to $249,052 in 2002. Selling,
general and administrative expenses decreased by $180,312 or 53% in 2003
primarily due to a reduction in personnel and overhead expenses offset by
increases in legal and professional fees incurred in the period due to
litigation.
Other Income
Other income of $166 in 2003 decreased $69,277 from $69,443 in 2002 primarily
due to reduced income from a joint venture and reduced interest income.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
ADM Tronics Unlimited, Inc.
By:\s\ Andre' DiMino
Andre' DiMino
Principal Financial Officer
Dated: Northvale, New Jersey
November 11, 2003
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