Form 10Q-SB for TS&B Holdings Inc
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
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[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Quarter Ended December 31, 2002
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 333-29903
TS&B Holdings, Inc.
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(Exact name of small business issuer as specified in its charter)
Utah 30-0123229
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Citrus Center 255 South Orange Ave. Suite 1501, Orlando, Florida 32801
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(Address of principal executive offices)
Registrant's telephone no., including area code: (407) 649-8325
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the past 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 [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date.
Class Outstanding as of December 31, 2002
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Common Stock, $.001 par value 31,859,700
TS&B HOLDINGS, INC.
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CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2002
TS&B HOLDINGS, INC.
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 2002
(Unaudited)
ASSETS
CURRENT ASSETS
Cash $ 1,312
Amounts due from stockholder 223,293
Amounts due from employee 60,000
Other current assets 5,340
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TOTAL CURRENT ASSETS 289,945
OFFICE EQUIPMENT, LESS ACCUMULATED
DEPRECIATION OF $1,653 6,610
OTHER ASSETS - DEPOSITS 4,150
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$ 300,705
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts payable and accrued
expenses $ 187,873
Notes payable to stockholders 226,763
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TOTAL CURRENT LIABILITIES 414,636
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COMMITMENTS AND CONTINGENCIES -
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STOCKHOLDERS' EQUITY (DEFICIT)
Common stock $.001 par value,
100,000,000 shares authorized,
31,859,700 shares issued and
outstanding 31,860
Additional paid-in capital 14,190,720
Stock subscription receivable ( 1,250,000)
Accumulated deficit (13,086,511)
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( 113,931)
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$ 300,705
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The accompanying notes to consolidated financial
statements are an integral part of this financial statement.
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TS&B HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND SIX MONTHS ENDED
DECEMBER 31, 2002 AND 2001
(Unaudited)
Three-months ended
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2002 2001
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REVENUES $ - $ 178,031
COST OF REVENUES - 32,254
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GROSS PROFIT - 145,777
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OTHER EXPENSES
General and administrative 32,769 94,984
Professional fees 17,710 6,889
Marketing 720 14,118
Depreciation and amortization 413 39,253
Salaries and related costs - 66,687
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51,612 221,931
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NET LOSS FROM OPERATIONS ( 51,612) ( 76,154)
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OTHER INCOME (EXPENSE)
Loss on investment in equity
securities - ( 188,880)
Interest, net 15,098 4,665
Other income (expense) - 4,706
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15,098 ( 179,509)
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NET LOSS $( 36,514) $( 255,663)
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LOSS PER COMMON SHARE $( .001) $( .023)
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WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING 31,859,700 11,004,293
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The accompanying notes to consolidated financial
statements are an integral part of these financial statements.
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TS&B HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND SIX MONTHS ENDED
DECEMBER 31, 2002 AND 2001
(Unaudited)
Six-months ended
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2002 2001
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REVENUES $ - $ 195,443
COST OF REVENUES - 63,808
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GROSS PROFIT - 131,635
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OTHER EXPENSES
General and administrative 83,808 61,375
Professional fees 418,978 53,390
Marketing 5,806 23,530
Depreciation and amortization 826 78,506
Salaries and related costs 675,000 142,820
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1,184,418 359,621
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NET LOSS FROM OPERATIONS ( 1,184,418) ( 227,986)
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OTHER INCOME (EXPENSE)
Loss on investment in equity
securities - ( 288,390)
Interest, net 34,002 13,043
Other income (expense) - 41,014
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34,002 ( 234,333)
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NET LOSS $( 1,150,416) $( 462,319)
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LOSS PER COMMON SHARE $( .044) $( .042)
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WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING 26,234,700 11,007,470
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The accompanying notes to consolidated financial
statements are an integral part of these financial statements.
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TS&B HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED
DECEMBER 31, 2002 AND 2001
(Unaudited)
2002 2001
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CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from operating revenues $ - $ 103,098
Cash paid for costs of sales and
other operating expenses (162,141) (282,554)
Interest ( 3,806) 9,860
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Net cash used by operating
activities (165,947) (169,596)
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CASH FLOWS FROM INVESTING ACTIVITIES
Decrease in notes receivable 800 58,978
Increase in advance to employee ( 60,000) -
Proceeds from sale of investments - 40,610
Purchase of fixed and other assets - ( 2,489)
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Net cash (used) provided by investing
activities ( 59,200) 97,099
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CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from sale of stock - 50
Proceeds from note payable 226,763 87,863
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Net cash provided by financing
activities 226,763 87,913
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NET INCREASE IN CASH 1,616 15,416
CASH, BEGINNING OF PERIOD ( 304) 4,070
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CASH, END OF PERIOD $ 1,312 $ 19,486
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The accompanying notes to consolidated financial
statements are an integral part of these financial statements.
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TS&B HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED
DECEMBER 31, 2002 AND 2001
(Unaudited)
2002 2001
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RECONCILIATION OF NET LOSS TO
CASH FLOWS FROM OPERATING ACTIVITIES
NET LOSS $(1,150,416) $(462,319)
RECONCILING ADJUSTMENTS
Depreciation and amortization 826 78,506
Loss on investment in equity securities - 288,390
Increase in accounts receivable, net ( 37,808) ( 92,345)
Decrease in inventory - 48,602
Increase in other assets ( 4,240) ( 13,129)
Decrease in accounts payable
and accrued expenses ( 809) ( 49,555)
Stock issued for compensation and
consulting services 1,026,500 32,254
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CASH FLOWS FROM OPERATING ACTIVITIES $( 165,947) $(169,596)
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NONCASH INVESTING AND FINANCING ACTIVITIES
ISSUANCE OF STOCK FOR SERVICES $ 1,026,500 $ 507,800
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The accompanying notes to consolidated financial
statements are an integral part of these financial statements.
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TS&B HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2002
The information presented herein as of December 31, 2002, and for the six months
and three months ended December 31, 2002 and 2001, is unaudited.
NOTE A - BASIS OF PRESENTATION
The accompanying consolidated financial statements of TS&B Holdings,
Inc.(formerly known as Ammonia Hold, Inc.) (the Company) have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to the Securities and Exchange
Commission's Form 10-QSB and item 310(b) of Regulation S-B. Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, all adjustments (consisting of normal required adjustments)
considered necessary for a fair presentation have been included.
Operating results for the six month period ended December 31, 2002, are not
necessarily indicative of the results that may be expected for the year ending
June 30, 2003. For further information, refer to the June 30, 2002, financial
statements and footnotes included in the Company's annual filing with the
Securities and Exchange Commission.
NOTE B -NET LOSS PER COMMON SHARE
Net loss per common share is computed in accordance with the requirements of
Statement of Financial Accounting Standards No. 128.
NOTE C - BUSINESS ACQUISITIONS
The Company is in process of negotiating purchases of operating companies. In
some cases, letters of intent to purchase have been executed between the Company
and seller. Generally, each of these letters of intent contain provisions which
detail closing requirements. Further, each acquisition is subject to regulations
of the Securities and Exchange Commission.
Through February 16, 2003, the Company has not closed nor met the requirements
to close, on the purchase of any operating companies.
NOTE D - OPERATING RESULTS
As noted in the accompanying financial statements, the Company has sustained
substantial net operating losses. Its ability to continue as a going concern and
realize its assets is dependent upon generating sufficient profitable revenues
and obtaining funding to support operations and fund acquisitions.
Management is in process of seeking funds to support continuing operations and
fund acquisitions. Management is confident they will be successful in their
negotiations and will obtain the necessary funding.
Through February 16, 2003, the Company has not obtained the funding necessary to
support acquisitions.
The accompanying financial statements have been prepared on the basis the
Company will continue as a going concern and will realize its assets.
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TS&B HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2002
NOTE E - STOCK ISSUED FOR COMPENSATION AND CONSULTING SERVICES
During the six month period ended December 31, 2002, the Company issued
11,250,000 shares of common stock for employee and officer compensation and for
consulting services as follows:
Employee and officer compensation $ 675,000
Consulting services 351,500
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$1,026,500
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The quoted fair market value of the Company's stock was used to value the shares
issued above.
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Management's Discussion and Analysis or Plan of Operations
The following information should be read in conjunction with the consolidated
financial statements and notes thereto appearing elsewhere in this Form 10-QSBA.
TS&B Holdings, Inc. continues to undergo a general restructuring which commenced
last year. It has faced several delays due to many upheavals, including the
September 11, 2001 terrorist attack. Management's goal has been and continues to
be the transformation of the Company into a holding company with three operating
subsidiaries. The Company currently has one subsidiary, TS&B Financial Services,
Inc.
Management;s goal is to develop the Company into a real estate development and
financial services firm.
Management will continue to look at explore other acquisition opportunities as
they present themselves.
Planned Acquisition
On April 15, 2002, the Company entered into an acquisition agreement, subject to
final audit, with PDG LLC ("PDG"), a Florida LLC, which provides and engages in
real estate development and management. PDG currently has two developments in
Naples, Florida known as The Chase Preserve at Lily Resort and Sunstone on the
Fairways at Lily Resort.
The Chase Preserve at Lily Resort is located along a 34+- acre natural Cypress
Preserve surrounded by shimmering lakes and emerald fairways. Because this land
is deeded specifically as a Preserve, it will never be developed. The developers
have exercised caution to maintain the natural beauty of The Chase Preserve at
Lily Resort. The Chase Preserve at Lily Resort has been designed so homeowners
can enjoy two of life's most precious commodities, privacy and beauty.
All twin villas have beautifully laid out floor plans on first and second living
floors. These spacious floor plans provide comfort, convenience and the same
luxury of a single-family home. All villas are three bedrooms; three baths and
the innovative designs feature large master suites, unique master baths with
luxurious appointments, open kitchens, great rooms, dining and two-car garages
with separate storage.
Chase Preserve residents enjoy a neighborhood recreation area with a 20-by-40
foot heated swimming pool surrounded by an expansive sundeck and a poolside
cabana with facilities including a wet bar, a perfect spot for neighborhood
gatherings and special events.
Sunstone on the Fairways at Lily Resort is located surrounded by emerald
fairways. All units have beautifully laid out floor plans on first or second
floors. These floor plans provide comfort, convenience and the same luxury of a
single-family home. Units are either two or three bedrooms with two baths.
Innovative designs features include comfortable master suites with master baths,
open kitchens, great rooms, dining and one-car garages with separate storage.
Sunstone on the Fairways residents enjoy a neighborhood recreation area with a
20-by-40 foot heated swimming pool and a poolside cabana with facilities
including a wet bar, a perfect spot for neighborhood gatherings and special
events.
PDG LLC competes against mid-sized real estate and land developers.
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Results of Operation
Gross profit for the second quarter ended December 31, 2002 ("second quarter" of
fiscal 2003) decreased 100% compared to the same 2002 fiscal period, due to
divesture of Ammonia Hold and Super Dry. General and Administrative expenses
decreased by 67% from the same quarter last year due to general restructuring of
the Company's operations. Professional fees increased by 157% from the previous
fiscal years quarter due to outside consulting fees. Marketing expense decreased
by 95% from the previous fiscal years quarter due to restructuring and
redirection of the Company's marketing efforts. Salaries and related cost
decreased by 100% from the previous fiscal years quarter due to general
restructuring of the Company's operations.
The Company recorded a net loss for the quarter of $36,514 or $0.001 per share
as compared to a net loss of $255,663 or $0.023 per share for the same quarter
last year. The Company continues to hold securities. When the securities are
sold, the company will record the appropriate gain, if any. It is uncertain if
the value of these securities will increase.
Liquidity and Capital Resources
For the past two fiscal years, the Company's working capital needs have been
satisfied by sales revenues and from the sale of securities. At December 31,
2002 the Company had a net working capital deficit of $124,691, a 41% increase
from the deficit of $88,590 at September 30, 2002. The increase in the working
capital deficit is primarily attributed to an increase in short-term debt. At
December 31, 2002, the Company had total assets of $305,720 and total
stockholders' deficit of ($113,931), compared to total assets of 277,920 and
total stockholders' equity of ($77,417) at September 30, 2002.
Net cash used by operating activities through the second quarter of fiscal year
2003 was $165,947 compared to $169,596 for the corresponding 2002 period. The
Company used $59,200 of cash for investing activities through the second quarter
of fiscal year 2003 as compared to $97,099 provided by investing activities in
the corresponding period of fiscal year 2002. The Company realized $226,763 cash
from financing activities through the second quarter of fiscal year 2003,
compared to $87,913 in the corresponding period of fiscal year 2002.
The Company anticipates meeting its working capital needs during 2003 fiscal
year primarily with revenues and debt financing.
In the opinion of management, inflation has not had a material effect on the
operations of the Company.
Risk Factors and Cautionary Statements
Forward-looking statements in this report are made pursuant to the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995. The Company
wishes to advise readers that actual results may differ substantially from such
forward-looking statements. Forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially from those
expressed in or implied by the statements, including, but not limited to, the
following: the ability of the Company to generate working capital, the
development of the Company's existing and new products, the potential market for
the Company's products, competitive factors, and other risks detailed in the
Company's periodic report filings with the Securities and Exchange Commission.
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SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
TS&B Holdings, Inc.
Date: February 19, 2003 By: /s/ JAMES E. JENKINS
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JAMES E. JENKINS
Chief Executive Officer