SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Form 10-Q
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended April 30, 2003.
[ ] 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: 0-16787
YOCREAM INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Oregon 91-0989395
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
5858 N.E. 87th Avenue
Portland, Oregon 97220
(Address of Principal Executive (Zip Code)
Office)
(503) 256-3754
(Registrants Telephone number, including area code)
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 X NO
The number of shares outstanding of the registrant's common stock, as of
the latest practicable date is:
Class: Common stock outstanding at
June 13, 2003: 2,252,178 shares
YOCREAM INTERNATIONAL, INC.
CONTENTS
Page
PART I FINANCIAL INFORMATION:
Item 1. Financial Statements
Balance Sheets as of April 30, 2003 3
(unaudited), and October 31, 2002
Statements of Income for the 4
Three Months ended April 30, 2003 and 2002,
and the Six Months ended April 30, 2003
and 2002(all unaudited)
Statements of Cash Flows for the 5
Six Months ended April 30, 2003 and 2002
(all unaudited)
Notes to Financial Statements 6-8
Item 2. Management's Discussion and Analysis of 8-12
Financial Condition and Results of
Operations
Item 3. Quantitative and Qualitative Disclosures 12
About Market Risk
Item 4. Controls and Procedures 12
PART II OTHER INFORMATION
Item 1. Legal Proceedings 13
Item 2. Changes in Securities 13
Item 3. Defaults upon Senior Securities 13
Item 4. Submission of Matters to a Vote of 13
Security Holders
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 14
SIGNATURES 14
CERTIFICATIONS 15-16
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
YOCREAM INTERNATIONAL, INC.
BALANCE SHEETS
April 30, October 31,
2003 2002
(Unaudited)
------------ -----------
ASSETS
Current assets
Cash and cash equivalents $1,593,691 $1,528,818
Accounts receivable, net 1,147,474 900,996
Inventories 2,346,577 2,654,432
Other current assets 526,804 311,227
Income taxes receivable 26,991 -
Deferred tax asset 34,600 34,600
----------- -----------
Total current assets 5,676,137 5,430,073
----------- -----------
Fixed assets, net 4,233,929 4,385,900
Intangible and other long-term assets, net 519,557 408,964
----------- -----------
$10,429,623 $10,224,937
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Current portion of long-term debt $ 355,264 $ 360,358
Accounts payable 1,125,307 1,083,954
Income taxes payable - 31,709
Other accrued liabilities 152,677 143,754
----------- -----------
Total current liabilities 1,633,248 1,619,775
Long-term debt, less current portion 875,000 858,167
Deferred tax liability 260,800 243,800
----------- -----------
Total liabilities 2,769,048 2,721,742
----------- -----------
Shareholders' equity
Preferred stock, no par value,
5,000,000 authorized; none issued - -
Common stock, no par value,
30,000,000 shares authorized;
2,252,178 and 2,250,178 shares
issued and outstanding 4,633,981 4,625,981
Retained earnings 3,026,594 2,877,214
----------- -----------
Total shareholders' equity 7,660,575 7,503,195
----------- -----------
$10,429,623 $10,224,937
=========== ===========
The accompanying notes are an integral part of the financial statements.
YOCREAM INTERNATIONAL, INC.
STATEMENTS OF INCOME
(Unaudited)
Three months ended Six months ended
April 30, April 30,
----------------------- -----------------------
2003 2002 2003 2002
---------- ---------- ---------- ----------
Sales $4,995,274 $4,593,568 $8,864,282 $7,955,284
Cost of sales 3,608,769 3,266,356 6,505,868 5,611,061
---------- ---------- ---------- ----------
Gross profit 1,386,505 1,327,212 2,358,414 2,344,223
Selling and marketing
expenses 555,775 460,896 1,028,931 868,679
General and administrative
expenses 600,473 492,387 1,075,287 923,269
---------- ---------- ---------- ----------
Income from operations 230,257 373,929 254,196 552,275
Other income (expenses)
Interest income 1,426 2,101 3,590 5,768
Interest expense (10,150) (12,088) (19,206) (26,000)
---------- ---------- ---------- ----------
Other, net ( 8,724) (9,987) (15,616) (20,232)
---------- ---------- ---------- ----------
Income before taxes 221,533 363,942 238,580 532,043
Income tax provision 82,800 139,700 89,200 204,300
---------- ---------- ---------- ----------
Net income $ 138,733 $ 224,242 $ 149,380 $ 327,743
========== ========== ========== ==========
Earnings per common share:
Basic $.06 $.10 $.07 $.15
========== =========== ========== ==========
Diluted $.06 $.10 $.07 $.14
========== ========== ========== ==========
The accompanying notes are an integral part of the financial statements.
YOCREAM INTERNATIONAL, INC.
STATEMENTS OF CASH FLOWS
For the six months ended April 30, 2003 and 2002
(Unaudited)
2003 2002
---------- ----------
Cash flows from operating activities:
Net income $ 149,380 $ 327,743
Adjustments to reconcile net
income to net cash provided by
operating activities:
Depreciation and amortization 255,319 303,235
Deferred income taxes 17,000 45,000
Change in assets and liabilities
Accounts receivable (246,478) (284,565)
Inventories 307,856 (117,692)
Other assets (352,177) (136,355)
Accounts payable 41,353 11,286
Income taxes payable (31,709) (122,175)
Other accrued liabilities 5,179 (26,329)
--------- ---------
Net cash provided by
operating activities 145,723 148
--------- ---------
Cash flows from investing activities:
Expenditures for fixed assets (100,590) (440,342)
--------- ---------
Net cash used in investing
activities (100,590) (440,342)
--------- ---------
Cash flows from financing activities:
Proceeds from issuance of long-term debt 168,500 156,500
Proceeds from exercise of stock options 8,000 232,780
Principal payments on long term debt (156,760) (171,902)
Repurchase of common stock - (375,441)
--------- ---------
Net cash provided by (used in)
financing activities 19,740 (158,063)
--------- ---------
Net increase(decrease) in cash and
cash equivalents 64,873 (598,257)
Cash and cash equivalents, beginning of period 1,528,818 1,161,661
---------- ---------
Cash and cash equivalents, end of period $1,593,691 $ 563,404
========== =========
The accompanying notes are an integral part of the financial statements.
YOCREAM INTERNATIONAL, INC.
NOTES TO FINANCIAL STATEMENTS
Note A - Basis of Presentation
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Rule 10-01 of Regulation
S-X. 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, which consist of
normal recurring accruals, considered necessary for a fair presentation have
been included. Operating results for the second quarter and six months ended
April 30, 2003 are not necessarily indicative of the results that may be
expected for the year ending October 31, 2003. For further information, refer
to the financial statements, and footnotes thereto, included in the
Corporations annual report on Form 10-K for the year ended October 31, 2002.
Note B - Change in Accounting Policy
In July 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) SFAS No. 142, Goodwill
and Other Intangible Assets. SFAS No. 142 changes the accounting for
goodwill and other identifiable intangibles with indefinite lives from an
amortization method to an impairment-only approach. The Company adopted SFAS
No. 142 and, as a result, amortization of intangibles ceased in the first
quarter of fiscal 2003. Had SFAS No. 142 been adopted at the beginning of
fiscal 2002, depreciation and amortization of approximately $2,400 and $4,900
would not have been recorded, and net income would have been approximately
$225,700 and $330,700 for the three and six-month periods ended April 30, 2002,
respectively, with no effect on earnings per share.
In October 2001, the FASB issued SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets, which addresses financial
accounting and reporting for the impairment or disposal of long-lived
assets. SFAS No. 144 becomes effective for fiscal years beginning after
December 15, 2001. The adoption of SFAS No. 144 in the first quarter of
fiscal 2003 did not have any effect on the Companys financial position,
cash flows or results of operations.
Note C - Inventories
April 30, October 31,
2003 2002
---------- ----------
Inventories consist of
Finished goods $1,781,756 $1,996,415
Raw materials 322,477 412,345
Packaging materials and supplies 242,344 245,672
---------- ----------
$2,346,577 $2,654,432
========== ==========
NOTES TO FINANCIAL STATEMENTS - Continued
Note D - Note Payable to Bank
The Company has an uncollateralized bank line of credit which permits
borrowings of up to $2,000,000. The line bears interest at the banks
commercial lending rate. The line is subject to renewal by July 2003.
There were no borrowings outstanding at April 30, 2003, or October 31, 2002.
During the three months ended January 31, 2003, the Company borrowed the
remaining $168,500 under a $350,000 term loan facility with its bank. The
agreement provides for level principal payments over five years, with interest
payable at a rate equal to the 30-day LIBOR rate plus 200 basis points (3.32%
at April 30, 2003), and is secured by the related equipment. The agreement
also provides the option to swap for a fixed rate.
Note E - Earnings Per Share
Earnings per share is calculated as follows for the three months ended
April 30, 2003 and 2002:
Three Months Ended April 30, 2003
----------------------------------------
Net Earnings Shares Per-Share
(Numerator) (Denominator) Amount
------------ ------------- ---------
Basic earnings per share:
Net earnings $138,733 2,252,178 $ .06
Effect of dilutive securities - 25,973 -
-------- --------- -------
Diluted earnings per share $138,733 2,278,151 $ .06
======== ========= =======
Three Months Ended April 30, 2002
----------------------------------------
Net Earnings Shares Per-Share
(Numerator) (Denominator) Amount
------------ ------------- ---------
Basic earnings per share:
Net earnings $224,242 2,255,015 $ .10
Effect of dilutive securities - 14,264 -
-------- ---------- -------
Diluted earnings per share $224,242 2,269,279 $ .10
======== ========== =======
NOTES TO FINANCIAL STATEMENTS - Continued
Earnings per share is calculated as follows for the six months ended
April 30, 2003 and 2002:
Six Months Ended April 30, 2003
-----------------------------------------
Net Earnings Shares Per-Share
(Numerator) (Denominator) Amount
------------ ------------- ---------
Basic earnings per share:
Net earnings $149,380 2,251,245 $ .07
Effect of dilutive securities - 31,541 -
-------- --------- -------
Diluted earnings per share $149,380 2,282,786 $ .07
======== ========= =======
Six Months Ended April 30, 2002
-----------------------------------------
Net Earnings Shares Per-Share
(Numerator) (Denominator) Amount
------------ ------------- ---------
Basic earnings per share:
Net earnings $327,743 2,257,058 $ .15
Effect of dilutive securities - 9,722 (.01)
-------- --------- -------
Diluted earnings per share $327,743 2,266,780 $ .14
======== ========= =======
Item 2. Managements Discussion and Analysis of Financial Condition and
Results of Operations.
The following discussion includes forward-looking statements within the meaning
of the "safe-harbor" provisions of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements are based on the beliefs of the
Company's management and on assumptions made by and information currently
available to management. All statements other than statements of historical
fact, regarding the Companys financial position, business strategy and plans
and objectives of management for future operations of the Company are forward-
looking statements. When used herein, the words "anticipate," "believe,"
"estimate," "expect," and "intend" and words or phrases of similar meaning, as
they relate to the Company or management, are intended to identify forward-
looking statements. Although the Company believes that the expectations
reflected in such forward-looking statements are reasonable, it can give no
assurance that such expectations will prove to have been correct. Forward-
looking statements are subject to certain risks and uncertainties, which could
cause actual results to differ materially from those indicated by the forward-
looking statements. These risks and uncertainties include the Companys
ability to maintain or expand its distribution abilities, including the risk of
disruptions in the transportation system and relationships with brokers and
distributors. Further, actual results may be affected by the Companys ability
to compete on price and other factors with other manufacturers and distributors
of frozen dessert products; customer acceptance of new products; general trends
in the food business as they relate to customer preferences for the Companys
products; and the Companys ability to obtain raw materials and produce
finished products in a timely manner, as well as its ability to develop and
maintain its co-packing relationships and strategic alliances. In addition,
there are risks inherent in dependence on key customers, the loss of which
could materially adversely affect the Companys operations. The reader is
advised that this list of risks is not exhaustive and should not be construed
as any prediction by the Company as to which risks would cause actual results
to differ materially from those indicated by the forward-looking statements.
Results of Operations
Sales
The primary business of the Company is the manufacture, marketing and sales of
superior quality frozen yogurt, frozen custard, sorbet, smoothie, coffee latte
and ice cream products in a variety of premium, low-fat, and nonfat flavors in
either non-organic or organic formulations. The Company also copacks similar
products for other companies. Because of the nature of these products, sales
are subject to seasonal fluctuations, with the summer months normally being the
busiest season. The introduction and roll out of new products has tended to
level the seasonal fluctuations.
The Companys sales increased 8.7% to $4,995,000 for the second quarter, and
increased 11.4% to $8,864,000 for the six months ended April 30, 2003, compared
to the corresponding periods in 2002. The increases resulted primarily from
sales of new products, which include a soft frozen custard, a gourmet ice
cream, and an aseptic coffee latte` freeze product. The breakdown of sales by
product for the six months ended April 30, 2003 and 2002 are as follows:
% % Dollar %
Category 2003 Total 2002 Total Increase Increase
-------- ---------- ----- ---------- ----- --------- --------
Yogurt $4,443,000 50.1% $4,291,000 53.9% $ 152,000 3.6%
Smoothies 2,950,000 33.3% 3,082,000 38.7% (132,000) (4.3)%
Coffee Latte 826,000 9.3% 372,000 4.7% 454,000 122.1%
Custard and 565,000 6.4% 56,000 .7% 509,000 913.4%
Ice Cream
Copacking 80,000 .9% 154,000 2.0% (74,000) (47.7)%
---------- ----- ---------- ----- -------- ------
Total $8,864,000 100% $7,955,000 100% $909,000 11.4%
========== ===== ========== ===== ======== ======
Coffee latte freeze is an aseptic product that was developed for Costco
Wholesale. The dramatic increase in sales of this product relates to gains
since the Company introduced the aseptic packaging for this product. The
Company first introduced this product as a frozen liquid mix. Because of the
significant demand for this product, the Company responded to the needs of its
customer and developed its current aseptically packaged product in the third
quarter 2002. In addition to the expensive ingredients in this high quality
product, the Company has also incurred a significant level of additional
production costs to provide the aseptic product, without the ability to pass
these costs on to the customer. To improve operating results, the Company is
currently analyzing its costs to identify savings opportunities. Furthermore,
the Company is identifying other potential customers for this outstanding
product at prices consistent with historical margins.
Soft frozen custard and gourmet-softened ice cream represent the indulgent line
of products that were introduced last year. In June 2002, the Company began
shipments of a new soft frozen custard product to a Nebraska-based chain of 64
restaurants. In the third quarter of 2002, the Company also began supplying
gourmet softened ice cream, which was developed especially for a Seattle based
chain of specialty coffee shops. To respond to the demand for frozen novelty
products, the Company has also developed a line of custard cups available in a
4-ounce hard pack single serving size. In the first quarter of 2003, the
Company began initial distribution of this new product to distributors that
supply the military, which are expected to augment sales to military
installations during fiscal 2003.
In October 2001, the Company announced that the alliance with The Dannon
Company was expanded, beyond merely selling yogurt to Dannons foodservice
customers, to include a co-branded line of soft serve frozen yogurt. This top-
quality product line carries the Dannon / YoCream label and includes more than
forty flavors of soft serve frozen yogurt. This co-branded line using YoCream
formulas that include nonfat, lowfat, and no-sugar-added flavors, was made
available through food service distributors in mid-2002. The strength of the
Dannon name along with YoCreams concentration on the foodservice or on-premise
marketplace is expected to offer significant opportunities for increased sales
and market share. Management believes that the two companies are similar in
philosophy, and both companies yogurt products are known for their high live
culture count, with an emphasis on product quality and appeal to consumers with
concerns for health and nutrition. The companies are currently cooperating on
national and regional account sales.
Following the Companys historical trend of developing innovative, high quality
products that are designed to delight the consumer, the Company recently
announced its newest product line of soy based frozen desserts. These unique
products are dairy free, all natural, vegan and cultured. The positive
response to sampling has been outstanding, and initial distribution began in
June.
Gross Profit
The Company's gross profit margin decreased from 28.9% to approximately 27.8%
for the second quarter and from 29.5% to 26.6% for the six-month periods in
both years.
The decreased margins in the fiscal 2003 periods are primarily due to the
change in sales mix and the increased costs related to the coffee latte
product. Management expects that its cost saving measures along with increased
sales will result in increased margins.
Selling and Marketing Expenses
Selling and marketing expenses increased, as a percentage of sales, from 10.0%
to 11.1% for the second quarter, and increased from 10.9% to 11.6% for the six
months. Sales and marketing expenses in total have increased due to
promotional expenses, payroll, and travel expenses. Management believes that
the opportunities merit the intensified sales and marketing activities.
General and Administrative Expenses
General and administrative expenses increased, as a percentage of sales, from
10.7% to 12.0% of sales for the quarter, and increased from 11.6% to 12.1% for
the six months. General and administrative expenses have increased in total
primarily due to personnel related expenses.
Income from Operations
Income from operations of $230,000 for the second quarter was 4.6% of sales
compared to 8.1% for the corresponding quarter last year. The results for the
six months were $254,000, or 2.9% of sales, while last year it represented 6.9%
of sales. The decrease in income from operations was primarily due to the
effect on margins from the sales of the coffee latte product.
Provision for Income Taxes
The effective tax rate was 37.4% and 38.4% for the first six months of 2003 and
2002, respectively. The effective rate in 2003 is the same as the rate for the
full year 2002, and reflects a similar level of research and development
activity.
Net Income
Net income for the quarter was approximately $139,000, or 2.8% of sales,
compared to $224,000, or 4.9% for last year. The net income for the six months
was $149,000, or 1.7% of sales, compared to $328,000, or 4.1% for last year.
Historically, net income as a percentage of sales has been higher in the second
half of the fiscal year because the summer months are the prime selling season
for the Companys frozen deserts and beverage products. Coupled with historical
results, management anticipates that net income, as a percentage of sales, will
be higher for the balance of the fiscal year.
Liquidity and Capital Resources.
In recent years, the Company has financed its operations and expansion from
bank loans, operating leases, capital leases, stock sales, and internally
generated funds.
As of April 30, 2003, there were no borrowings under the Companys $2 million
bank line of credit. The line of credit remains in place and permits
borrowings subject to the Company being in compliance with certain ratios and
negative covenants. Interest on the line of credit is at the bank's basic
commercial lending rate.
During the first quarter of 2003, the Company completed borrowings of $168,500
under the terms of a secured term loan agreement to finance certain production
equipment.
EBITDA (earnings before interest, taxes and depreciation) was approximately
$510,000 in the six months ended April 30, 2003 compared with $856,000 in the
same period of 2002, as a result of the decrease in income from operations
explained above.
Expenditures for plant and equipment of approximately $101,000 in the six
months ended April 30, 2003 compared to $440,000 spent in the same period last
year.
The Company has recently approved plans for a $2.5 million high acid aseptic
packaging system for the smoothie product that the Company is currently
producing. Expenditures will occur over the next three quarters and are
expected to be financed with cash and a bank term loan.
The Company follows the practice of repurchasing its common stock from time to
time. There were no repurchases in the six months ended April 30, 2003, while
repurchases during the same period in 2002 amounted to approximately $375,000.
During the six months ended April 30, 2002, the Company purchased 61,413 shares
of its common stock.
The Company believes its existing assets, bank lines, and revenues from
operations will be sufficient to fund the Companys operations for at least the
next twelve months.
New Accounting Pronouncements
See Note B of Notes to Financial Statements for a discussion of the adoption of
new accounting pronouncements.
Critical Accounting Policies and Estimates
The critical accounting policies and the use of estimates as reported in the
Companys Form 10-K for the year ended October 31, 2002 are reaffirmed.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Ingredients used in the Companys products are agricultural products subject to
price risk. The Company attempts to minimize this risk by entering into
contracts to cover its annual production requirements. Historically, there
have been situations that when the contracts matured, and cost increases were
experienced, competitive conditions limited the Companys ability to pass on the
additional costs. Currently, the Company has embarked upon an aggressive
program to reduce costs and create efficiencies, which management believes will
be successful in improving margins.
At April 30, 2003, borrowings outstanding under secured term loan facilities
with its bank amounted to approximately $1,230,000. The facilities bear
interest at a rate equal to the 30-day LIBOR rate plus 200 basis points (3.32%
at April 30, 2003), with the option to fix the rate during the term. A
hypothetical increase of 200 basis points in the interest rate would increase
interest expense by approximately $21,000 in the next year, if the rate were
not fixed by entering into an interest rate swap.
The Company does not currently use derivative securities.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
The Companys Chief Executive Officer and Chief Financial Officer have
reviewed and evaluated the effectiveness of our disclosure controls and
procedures, as defined in Rules 240.13a-14(c) and 15d-14(c) under the
Securities Exchange Act of 1934 (Exchange Act), as of a date within ninety
days before the filing date of this quarterly report. Based on that
evaluation, the Chief Executive Officer and the Chief Financial Officer have
concluded that the Companys disclosure controls and procedures are adequate
and effective to ensure that information that the Company is required to
disclose under the Exchange Act is recorded, processed, summarized and
reported on a timely basis.
Changes in Internal Controls
There have not been any significant changes in the Companys internal
controls or in other factors that could significantly affect these controls
subsequent to the date of their evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not involved in any material pending legal proceedings.
Item 2. Changes in Securities
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to Vote of Security Holders
The annual meeting of shareholders was held on April 16, 2003, at which
time the following actions were taken:
A. The amendment to the Articles of Incorporation was approved to (1)
classify the Board of Directors into three classes to be elected at the
2003 Annual Shareholders Meeting to serve terms of one, two and three
years, with each class of director thereafter to serve a three-year term,
and (2) prohibit the removal of a director mid-term except for cause as
defined in the amendment.
Shares voted for 1,095,613
Shares voted against 413,060
Shares abstained 3,300
B. The amendment to the Companys 2000 Stock Option Plan increasing the
number of shares authorized for grants of options under that plan from
200,000 to 400,000 was approved. The voting results were as follows:
Shares voted for 1,100,322
Shares voted against 406,201
Shares abstained 5,450
C. The six nomimees for election as directors were elected. The voting
results were as follows:
Shares Shares
Voted For Abstained
--------- ---------
John N. Hanna 2,118,809 5,903
David J. Hanna 2,118,809 5,903
James S. Hanna 2,118,809 5,903
Joseph J. Hanna 2,118,709 6,003
William J. Rush 2,118,804 5,908
Carl G. Behnke 2,118,809 5,908
David J. Hanna and Joseph J. Hanna, Jr. were elected as Class I
directors to serve for a term of one year, or until their successor
shall have been elected and qualified.
Carl G. Behnke and William J. Rush were elected as Class II directors
to serve for a term of two years, or until their successor shall have
been elected and qualified.
James S. Hanna and John N. Hanna were elected as Class III directors
to serve for a term of three years, or until their successor shall
have been elected and qualified.
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
A. Exhibits
99.1 Certification of John N. Hanna pursuant to Section 906
of the Sarbanes-Oxley Act of 2002.
99.2 Certification of W. Douglas Caudell pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.
B. Reports on Form 8-K - not applicable
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.
Registrant:
YOCREAM INTERNATIONAL, INC.
Date: June 13, 2003 By: /s/ John N. Hanna
John N. Hanna, Chairman of the
Board, and Chief Executive
Officer
Date: June 13, 2003 By: /s/ W. Douglas Caudell
W. Douglas Caudell, Chief
Financial Officer
CERTIFICATION PURSUANT TO
SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002
I, John N. Hanna, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Yocream
International, Inc.;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to the
period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
we have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly
report is being prepared;
b) evaluated the effectiveness of the registrants disclosure
controls and procedures as of a date within 90 days prior to the
filing date of this quarterly report (the Evaluation Date); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrants other certifying officer and I have disclosed, based
on our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent functions):
a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrants
ability to record, process, summarize and report financial data and
have identified for the registrants auditors any material weaknesses
in internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrants
internal controls; and
6. The registrants other certifying officer and I have indicated in this
quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant deficiencies
and material weaknesses.
Date: June 13, 2003 By: /s/ John N. Hanna
John N. Hanna, Chairman of the
Board, and Chief Executive Officer
CERTIFICATION PURSUANT TO
SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002
I, W. Douglas Caudell, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Yocream
International, Inc.;
2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to the
period covered by this quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and
we have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly
report is being prepared;
b) evaluated the effectiveness of the registrants disclosure
controls and procedures as of a date within 90 days prior to the
filing date of this quarterly report (the Evaluation Date); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures based on our
evaluation as of the Evaluation Date;
5. The registrants other certifying officer and I have disclosed, based
on our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent functions):
a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the registrants
ability to record, process, summarize and report financial data and
have identified for the registrants auditors any material weaknesses
in internal controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrants
internal controls; and
6. The registrants other certifying officer and I have indicated in this
quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent evaluation,
including any corrective actions with regard to significant deficiencies
and material weaknesses.
Date: June 13, 2003 By: /s/ W. Douglas Caudell
W. Douglas Caudell,
Chief Financial Officer