<SUBMISSION-INFORMATION-FILE>
<TYPE> 10QSB
<DOCUMENT-COUNT> 2
<SROS> NONE
<FILER>
<CIK> 0001081751
<CCC> #MD7FUEK
</FILER>
<PERIOD> 03/31/01
<DOCUMENT>
<TYPE> 10QSB
<DESCRIPTION> Form 10QSB
<TEXT>
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the quarterly period ended March 31, 2001
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from to
Commission file number
AMERICANA PUBLISHING, INC.
---------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
COLORADO 84-1453702
------------ --------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
303 SAN MATEO NE, SUITE 104A, ALBUQUERQUE, NM 87108
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(Address of principal executive offices)
505-265-6121
(Issuer's telephone number)
--------------------------------------------------------------------------------
(Former name, former address, and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the 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 ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes_____. No_____.
APPLICABLE ONLY TO CORPORATE ISSUERS
As of March 31, 2001, there were 10,108,396 shares of common stock outstanding.
Transitional Small Business Disclosure Format (Check one): Yes_____. No_____.
<PAGE>
INDEX
PAGE
----
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets
December 31, 2000 (Audited) and
March 31, 2001 (Unaudited) 3
Condensed Statement of Income (Loss)
Three months ended March 31, 2001
and 2000 4
Condensed Statements of Cash Flows
Three months ended March 31, 2001
and 2000 5
Notes to Condensed Financial Statements 6
Independent Accountant's Report 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 8-9
Part II. OTHER INFORMATION
Item 1. Legal Proceedings 10
Item 2. Changes in Securities 10
Item 3. Defaults Upon Senior Securities 10
Item 4. Submission of Matters to a Vote of Security Holders 10
Item 5. Other Information 10
Item 6. Exhibits and Reports on Form 8-K 10
SIGNATURES
2
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial statements
Americana Publishing, Inc.
Condensed Balance Sheet
For Periods Ending
March 31, December 31,
2001 2000
Assets (unaudited) (Audited)
Current Assets
Cash $ 23,767 $ 20,027
Marketable Securities 5,000 30,000
Inventory 26,468 20,237
Accounts Receivable 58,243 24,747
Prepaid & Misc. 51,013 56,496
----------- -------------
Total Current Assets $ 164,491 $ 151,597
Property & Equipment
Audio Equipment & Production Costs 170,708 160,217
Database & Circulation 239,313 239,313
Computer Equipment 130,722 128,537
Software 19,479 15,953
Furniture & Fixtures 50,863 47,463
Website Development 43,463 43,463
Other 31,907 31,907
Less: Accumulated Depreciation
and Amortization (123,166) (92,399)
----------- -------------
Total Property & Equipment 563,289 574,902
Total Asset $ 727,780 $ 726,499
=========== =============
Liabilities & Stockholders Equity
Current Liabilities
Accounts Payables $ 63,759 19,978
Accrued Liabilities 7,055 51,296
----------- -------------
Total Current Liabilities 70,814 71,274
Stockholders Equity
Preferred Stock 20,000,000 Shares
No Par Value, Authorized, None Issued
Common stock 100,000,000 Shares Authorized
$.001 Par Value 7,812,396 & 10,108,396
Issued and outstanding for December 31,
2000 and March 31, 2001, respectively 10,118 7,822
Paid-In Capital 5,605,833 5,122,225
Accumulated Deficit (4,958,985) (4,474,822)
---------- ----------
Total Stockholders' Equity 656,966 655,225
Total Liabilities & Stockholders Equity $ 752,508 $ 726,499
============ ===========
See Accompanying Notes to Financial Statements.
3
<PAGE>
Americana Publishing, Inc.
Statement of Income (Loss)
For the Period
Three Months Three Months
Ended Ended
March 31, 2001 March 31, 2000
Revenues
Audio Book Sales $ 94,781 $ 14,165
Shipping Revenue - 698
Advertising Revenue - 1,235
Other Revenue 30 -
---------- -----------
Total Revenue $ 94,811 $ 16,098
Cost of Goods 30,428 2,583
---------- -----------
Gross Profit $ 64,383 $ 13,515
Administrative Expenses
Compensation Expense $ 458,423 $ 665,881
Marketing Fees 18,510 67,441
Professional Fees 17,999 13,896
Management Fees 9,000 9,000
Depreciation 30,763 6,904
Other Operating Expenses 13,980 43,059
---------- -----------
Total Expenses $ 548,675 $ 806,181
---------- -----------
Net Operating Income (Loss) (484,292) (792,666)
Other Income/Expense
Income Tax Expense-Deferred $ - $ -
Interest Income 129 8,160
---------- -----------
Total Other Income/Expense $ 129 $ 8,160
Net Income (Loss) (484,163) (784,506)
Weighted Average Number of Common
Shares Outstanding 8,893,952 4,428,527
Income (Loss) per share Basic &
Diluted (0.05) (.18)
Dividends per Common Share - -
See Accompanying Notes to Financial Statements.
4
<PAGE>
Americana Publishing, Inc.
Condensed Statement of Cash Flows
(Unaudited)
Three Months Three Months
Ended Ended
March 31, 2001 March 31, 2000
Cash Flows From Operating Activities:
Net Loss $ (484,163) $ (784,506)
Adjustments to Reconcile Net Income(Loss)
To Net Cash Provided by Operating
Activities:
Depreciation 30,762 6,905
Capital Transactions 373,402 560,995
Increase (Decrease)in Accounts Receivable (33,496) 51,878
Increase (Decrease)in Prepaids 5,483 (70,866)
Increase (Decrease)in Accounts Payable (460) 28,312
Increase (Decrease)in Inventory (6,141) (3,894)
-------- -----------
Total Adjustments 369,551 573,330
-------- -----------
Net Cash Used by Operating Activities (114,612) (211,176)
Cash Flows From Financing Activities:
Proceeds From Sale of Common Stock 112,500 310,000
-------- -----------
Net Cash Provided by Financing 112,500 310,000
Cash Flows From Investing Activities:
Purchase of Property and Equipment (19,148) (163,863)
Purchase of Marketable Securities - (98,855)
Sale of Marketable Securities 25,000 -
--------- -----------
Net Cash Used in Investing Activities 5,852 (262,718)
Net Increase (Decrease) in Cash 3,740 (163,894)
Cash and Cash Equivalents at
Beginning of Period 20,027 308,376
-------- -----------
Cash and Cash Equivalents at
End of Period $ 23,767 144,482
============= ===========
See Accompanying Notes to Financial Statements.
5
<PAGE>
AMERICANA PUBLISHING, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1.
The unaudited internal condensed financial statements and related notes have
been prepared by Americana Publishing, Inc. (the “Company”), and not
subject to an audit pursuant to the rules and regulations of the Securities and
Exchange Commission. In the opinion of management, all adjustments (which
include only normal recurring adjustments) necessary to present fairly the
financial position, results of operations and cash flows at March 31, 2001 and
for all periods presented, have been made. Certain reclassifications have been
made to the prior year to conform with the current years presentation.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been omitted. It is suggested that these condensed financial statements be
read in conjunction with the Company´s audited financial statements and
notes thereto for the fiscal year ended December 31, 2000. The results of
operations for the three months ended March 31, 2001 are not necessarily
indicative of the operating results for the full year.
NOTE 2. LIQUIDITY
The Company has historically financed its operations through the sale of common
stock. Since inception the Company has raised $1.6 million in equity capital.
The proceeds were used for start-up activities including website development as
well as other start-up activities. The Company has a working capital surplus of
approximately $93,677. The Company´s revenues have average $30,000 per month for
2001. This revenue has not been adequate to cover current monthly cash
expenditures thus requiring the Company to raise additional capital infusions to
support operations. Currently management believes revenues will increase to
adequate levels to support cash expenditures. In addition management has
implemented a plan to lower cash expenditures and is actively pursuing
additional capital infusions. There is no assurance that adequate revenues will
be achieved to support operations, however, management believes it will be able
to raise additional capital, lower cash expenditures or a combination of both to
maintain operations for the next twelve months.
The Company will require future financing in various forms. The Company proposes
to finance working capital timing differences with an asset-based line of
credit. Capital improvements should be financed by intermediate-term debt. The
Company is not in possession of any commercial bank commitment letters or a
letter of intent from a capable underwriter at this time.
Note 3. Stock Transactions
During the first three months of 2001 the Company issued 1,736,000 shares of
common stock to various employees and consultants. The fair value of this stock
was booked as compensation expense and consulting expense.
During the first three months of 2001 the Company sold 560,000 of common shares
for $112,500 under regulation 4(2). Regulation 4(2) provides for the sale of
restricted shares of common stock without the preparation of a prospectus. The
share offered in the first quarter cannot be sold for a period of one year.
6
<PAGE>
Independent Accountant's Report
We have reviewed the accompanying condensed balance sheet of Americana
Publishing, Inc. as of March 31, 2001 and the related condensed statement of
operations for the three and six month periods ending March 31, 2001 and 2000
and of cash flows for the three month periods ending March 31, 2001 and 2000.
These financial statements are the responsibility of the Company´s
management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with auditing standards generally accepted in the United States of America, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of material modifications that should be
made to the accompanying financial statements for them to be in conformity with
generally accepted accounting principles.
/s/ Null Lairson
Houston, Texas
May 14, 2001
7
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
GENERAL
All phases of the Company's operations are subject to influences outside of the
Company's control. Any one, or a combination, of these factors could materially
affect the results of the Company's operations. These factors include
competition pressures, inflation, trade restrictions, interest rate fluctuations
and other capital market conditions, weather, future and options trading or
paper commodities, and the availability of natural resources and services from
other sources. Forward-looking statements are made by or on behalf of the
Company's knowledge of its business and the environment in which it operates,
but because of the factors listed above, as well as other environmental factors
over which the Company has no control, actual results may differ from those in
the forward-looking statements. Consequently, all of the forward-looking
statements made are qualified in their entirety by these cautionary statements
and there can be no assurance that the actual results or developments
anticipated by the Company will be realized, or even if substantially realized,
that they will have the expected effect on the business and/or operations of the
Company.
The Company currently has limited internal and external sources of liquidity. At
this time, the Company has no material commitment for capital expenditures.
There are no known trends, events or uncertainties that are expected to have a
material impact on the net sales and income from continuing operations.
Americana Publishing is not subject to seasonal aspects.
The fiscal year ended December 31, 2000, was marked by a number of events, which
in the opinion of management will strengthen the Company and ensure a continuous
growth pattern.
Site Development
The americanatextbooks.com website design and operating pages have been
completed. The site was fully operational on August 15th, 2000, but was
determined that the existing website was inadequate due to its limited database.
Therefore, a project to prepare and install a new database was undertaken and
completed in February, 2001.
Audio Book Development
Americana has purchased the audio production rights to over sixty (60) books. In
cooperation with John Wagner Studios, Americana is currently producing recording
and duplicating these books in preparation for sale to some 17,000 retail stores
and 3,000 libraries around the United States. Americana has completed production
and duplicated for inventory forty-five (45) audio books and is in various
stages of production on an additional seventeen (17) Additionally, the results
are beginning to show from the catalog mailing completed during the last
quarter. Total amount of approximately $ in invoiced sales have been achieved to
date. All forty five (45) titles are available for sale as a download from the
americanabooks.com website in addition to sales of audio tapes.
Liquidity and Capital Resources
The Company has historically financed its operations through the sale of common
stock. Since inception the Company has raised $1.6 million in equity capital.
The proceeds were used for start-up activities including website development as
well as other start-up activities. The Company has a working capital surplus of
approximately $93,677. The Company´s revenues have average $30,000 per month for
2001. This revenue has not been adequate to cover current monthly cash
expenditures thus requiring the Company to raise additional capital infusions to
support operations. Currently management believes revenues will increase to
adequate levels to support cash expenditures. In addition management has
implemented a plan to lower cash expenditures and is actively pursuing
additional capital infusions. There is no assurance that adequate revenues will
be achieved to support operations, however, management believes it will be able
to raise additional capital, lower cash expenditures or a combination of both to
maintain operations for the next twelve months.
The Company will require future financing in various forms. The Company proposes
to finance working capital timing differences with an asset-based line of
credit. Capital improvements should be financed by intermediate-term debt. The
Company is not in possession of any commercial bank commitment letters or a
letter of intent from a capable underwriter at this time.
8
<PAGE>
Capital Expenditure
During the first quarter of 2001, Americana made approximately $25,400 in
capital expenditures. The expenditures were for audio equipment, computer
equipment, computer software, and furnishings.
Acquisition
As part of the "Integrated Publishing Plan" the Company anticipates it will
acquire small sponsored book publishing companies and list their book titles on
its website as well as list book titles they do not own, that complement and
enhance the consumer appeal of the catalogue overall. These enterprises will
account for the majority of revenue of the Company in the future. The Company
has identified hundreds of potential targets. These acquisitions will be
transacted with the use of the Company's common stock. Americana executed a
direct mail campaign to over 4,000 book publishers nationwide to encourage
responses concerning interest in selling their companies to Americana. As of
April 15, 2000, Americana had received 12 communications from various quality
publishing enterprises that had expressed interest in a potential sale
transaction. Americana has been actively evaluating these businesses and has
issued five letters of intent. These letters of intent indicate to the
interested party that Americana is interested in pursuing negotiations and
entering into a formal purchase and sale agreement. Although on June 30, 2000
formal purchase agreements were sent to two publishers which did not mature into
executed purchase agreements, at the close of the fourth quarter, Americana had
outstanding an agreement to purchase selected assets in Hollis Books, LLC. As of
December 15, 2000, negotiations had been completed and a definitive Purchase and
Sale of Assets had been agreed upon with Hollis Books, LLC. This acquisition was
completed during the first quarter of the calendar year 2001. Additionally, a
contract was entered between Trine Publications, Inc., and Americana for the
purchase of selected assets of Trine by Americana. This acquisition was also
completed in the first quarter of 2001.
The Company intends to acquire a heat set web press company, and book binding
company. These enterprises will vertically integrate production and control of
quality audio books as well as re-print books for its family of over 100
publishers now supplying books through americanabooks.com. The Company currently
has upgraded its existing recording studio to accommodate digital equipment.
This currently serves as an additional facility to record audio books.
Results of Operations
Quarter Ended March 31, 2001 Compared to Quarter March 31, 2000
Revenue increased from $16,098 to $94,811 as a result of additional audio book
sales. Compensation expense decreased $458,422 due to the reduction of staff and
the issuance of common stock to employees and directors. Cost of goods increased
to $30,428 from $2,583 due to the increase in tape duplication. Marketing and
other expenses combined decreased $78,010 as a result of management cost
reduction program. Depreciation expense increased to $30,163 from $6,904
primarily as a result of higher property, professional and management fees
remained relatively unchanged.
9
<PAGE>
Part II. Other Information
Item 1. Legal Proceedings
During the first quarter of 2001, Americana Publishing, Inc. filed suit for
breach of contract against its former securities counsel, Mr. Raul Rodriguez, to
recover 50,000 shares of Rule 144 stock which had been issued to Mr. Rodriguez
in 1999 as a fee for his representation of the Corporation in SEC matters. As a
result of Mr. Rodriguez’ actions, Americana Publishing, Inc. has filed suit
to recover the stock remaining in Mr. Rodriguez’ possession in addition to
any profits which he attained through sale of the stock.
Item 2. Changes in Security
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
None
(b) Reports on Form 8-K
None
SIGNATURES
In accordance with 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 hereunto duly authorized.
Americana Publishing, Inc.
(Registrant)
By: /s/ George Lovato, Jr.
-----------------------------------
Date: May 9, 2001 George Lovato, Jr., CEO/Chairman
10