SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
+---+
| x | QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
+---+ SECURITIES EXCHANGE ACT OF 1934
For the quarterly period MARCH 31, 2003
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 no. 0-3677
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DATATAB, INC.
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(Exact name of registrant as specified in its charter)
NEW YORK 13-1917838
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
49 EAST 21ST STREET, NEW YORK, NEW YORK 10010
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 228-6800
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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
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COMMON SHARES $1.00 PAR VALUE - 705,836 SHARES OUTSTANDING AS OF
May 14, 2003 (EXCLUSIVE OF 83,119 SHARES IN TREASURY)
DATATAB, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
ASSETS
MARCH 31 DECEMBER 31,
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2003 2002
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(UNAUDITED)
Current assets:
Cash ............................................ $ 597 $ 2,203
Accounts receivable ............................. 2,327 3,960
Inventories of work in process .................. 1,000 1,000
Miscellaneous receivables ....................... - 200
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Total current assets .......... 3,924 7,363
Furniture, fixtures, equipment and
improvements (at cost, less
accumulated depreciation of
$126,535 in 2003 and $126,517
in 2002) .............................. 145 163
Other assets .................................... 150 150
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Total ......................... $ 4,219 $ 7,676
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(Continued)
DATATAB, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
LIABILITIES
MARCH 31, DECEMBER 31,
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2003 2002
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(UNAUDITED)
Current liabilities:
Accounts payable ........................ $ 14,316 $ 13,167
Accrued expenses and taxes .............. 188,342 167,361
Customer advances ....................... 70,000 70,000
Payable to Data Probe, Inc. ........ 35,123 89,186
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Total current liabilities .......... 307,781 339,714
Other liabilities ................................ 10,600 10,600
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Total liabilities .................. 318,381 350,314
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STOCKHOLDERS' EQUITY
Preferred shares - authorized 500,000
shares, par value $1 a share;
none issued ............................ -- --
Common shares - authorized 2,000,000 shares, par
value $1 a share; issued
788,955 (including
shares held in treasury) ................ 788,955 788,955
Additional paid in capital ....................... 2,490,471 2,490,471
Deficit .......................................... (3,462,131) (3,490,607)
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(182,705) (211,181)
Less cost of 83,119 common shares
held in treasury ........................ 131,457 131,457
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Total Shareholders' Equity ............ (314,162) (342,638)
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TOTAL ............................................ $ 4,219 $ 7,676
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See accompanying notes to financial statements
DATATAB, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(NOTES A AND B)
(UNAUDITED)
THREE MONTHS ENDED
MARCH 31,
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2003 2002
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Sales ............................................ $ 17,679 $ 38,041
Cost of sales .................................... 31,433 85,424
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Gross (Loss)/Profit .............................. $ (13,754) $ (47,383)
Selling and administrative
expenses .................................... 36,319 36,402
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(Loss) Profit from operations .................... $ (50,073) $ (83,785)
Interest (Expense)/income ........................ (1,451) 989
Payment received due to business interruption .... - 8,953
Payment received for relinquishing the office
lease 2 years prior to its expiration date .. 80,000 -
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Profit (Loss) before
provision for income taxes .................. $ 28,476 $ (73,843)
Income tax provision ............................. -- --
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Net Profit (Loss) ................................ $ 28,476 $ (73,843)
========= =========
Profit/(Loss) per share........................... $ .04 $ (.10)
========= =========
Weighted average number
of shares outstanding ....................... 705,836 705,836
========= =========
Dividends per share .............................. NONE NONE
========= =========
The attached notes are made a part hereof.
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Management's discussion and analysis of financial condition and results
of operations is included on the following page.
DATATAB, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Revenue for the three months period ended March 31, 2003 decreased to
$17,679 as compared to $38,041 for the corresponding period of 2002. The
decrease in revenue during the first quarter of the current fiscal year was due
to the loss of two clients. One client ceased operations and second client
decided to perform its data processing internally. The reduction was also due to
a general decrease in volume because of a severe slow down in the market
research industry. The September 11 terrorist attack in New York was the
dominant catalyst and contributor to this slow down.
Cost of sales in the three months period ended March 31, 2003 decreased by
$53,991 or 63%. The decrease in revenue forced the Registrant to institute cuts
in labor and other costs. During the first quarter costs were lowered to a
minimum required to meet anticipated demand for market research services. In
past years demand for market research services was always higher in the first
quarter of a calendar year. This year it did not materialized.
Selling and Administrative (S&A) expenses were maintained at previous
year's level.
During the three months period ending March 31, 2003 the Registrant
incurred some interest expense due to advances made to it by Data Probe, Inc. In
the past, the majority of interest income earned was recognized from Data Probe,
Inc. and it's receivable to the Registrant. (See NOTE F of "Notes to Form 10-Q"
contained in this report for additional information)
During the first quarter of fiscal year 2003 Registrant's loss from
operations was ($50,073) or ($.07) per share as compared to a loss from
operations of ($83,785) or ($0.12) per share during the corresponding period in
fiscal year 2002. Overall, the registrant is reporting a profit of $28,476, or
$.04 per share, during the three months period ending March 31, 2003 as compared
to a loss of ($73,843), or ($.10) per share, in the similar period of 2002. This
profit was due to the receipt of $80,000 from Data Probe, Inc. as Registrant's
share in a one-time payment received for relinquishing the office lease two
years earlier than its expiration date. The Registrant will be moving with
(Continued)
DATATAB, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Data Probe, inc., its parent, to a new, smaller office space at the Empire State
Building, 350 Fifth Avenue, New York, New York. Rent costs at the new office
space will be lower than Registrant's current costs.
CAPITAL EXPENDITURES.
The Registrant did not incur any capital expenditure in the first three
months of 2003.
LIQUIDITY AND CAPITAL RESOURCES.
Working capital increased by $28,494 in the first three months of 2003 from
a deficit of $332,351 at December 31, 2002 to a deficit of $303,857 at March 31,
2003.
The Registrant receives cash deposits from clients in association with
various projects. There is no assurance that the stream of sales and revenue
from the Registrant's major clients will continue. If additional revenues cannot
be sustained and the Registrant once again realizes losses, the Registrant's
ability to continue to operate would be severely affected in the absence of
securing some type of supplemental financing, the availability of which there
can be no assurance.
DATATAB, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT
CASH FLOWS
(NOTES A AND B)
(UNAUDITED)
THREE MONTHS ENDED
MARCH 31,
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2003 2002
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Cash flows provided (used) from operating activities:
Net Income/(Loss) .................................. $ 28,476 $(73,843)
Adjustments to reconcile net (loss) to net
cash provided by operating
activities:
Depreciation and amortization .................... 18 18
Decrease/(Increase) in accounts receivable ....... 1,833 15,343
Decrease/(Increase) in prepaid expenses and
other assets ................................. - 50
Increase/(Decrease) in accounts payable .......... 1,149 (6,308)
Increase/(Decrease) in accrued expenses
and taxes .................................... 20,981 12,611
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Net cash flow provided from (used by)
operating activities .......................... 52,457 (52,129)
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Cash flows provided (used) by investing activities:
Payments (to) from an affiliate .................. (54,063) 50,034
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Net cash flow provided (used) by
investing activities ................... (54,063) 50,034
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Net (Decrease)/Increase in cash .................... (1,606) (2,095)
Cash at beginning of period ........................ 2,203 9,483
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Cash at end of period .............................. $ 597 $ 7,388
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The notes to financial statements are made a part hereof.
DATATAB, INC. AND SUBSIDIARIES
NOTES TO FORM 10-Q
(UNAUDITED)
(NOTE A):
The financial information contained in this Form 10-Q represents
condensed financial data and, therefore, does not include all footnote
disclosures required to be included in financial statements prepared in
conformity with generally accepted accounting principles. Such footnote
information was included in the Registrant's annual 10K report to the SEC for
the year ended December 31, 2002; the condensed financial data included herein
should be read in conjunction with that report.
(NOTE B):
(1) In management's opinion, all necessary adjustments have been made
in order to present fairly the consolidated results of operations for the
interim periods.
(2) The results of operations for the interim period ending March 31,
2003 are not necessarily indicative of the results of operations for the year
ending December 31, 2003.
(NOTE C):
Profit and loss per share is based on the average number of shares of
common stock outstanding during each period after deducting treasury shares and
taking into consideration the dilutive effect of outstanding stock options when
applicable.
(NOTE D):
At December 31, 2003, for financial accounting and income tax
purposes, the Registrant has available net operating loss carry forwards in
excess of $1,023,000 of which $120,000 expires in 2003, $87,000 in 2004, $94,000
in 2005, $84,000 in 2006, $99,000 in 2007, and the balance in 2008 and
thereafter.
(NOTE E):
Inventories are summarized as follows:
March 31, 2003 December 31, 2002
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Work in process ...................... $1,000 $1,000
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(NOTE F:)
Data Probe, Inc., the majority stockholder, has made advances to the
Registrant. At March 31, 2003 Registrant's indebtedness to Data Probe was
$35,123 and was evidenced by a demand note bearing interest at 2% above the
prime rate.
For the three months ended March 31, 2003, Data Probe, Inc. charged
the Registrant $4,169 for services rendered and $17,602 in rent related
expenses. In addition, Data Probe, Inc. charged Registrant during the first
three months $1,451 for interest.
During the first quarter of fiscal year 2003 the Registrant
charged Data Probe $11,005 for services rendered.
PART II
ITEM 1. LEGAL PROCEEDINGS.
NONE
SIGNATURES
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Pursuant to the requirements of Section 13 or 15(d) 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.
DATATAB, INC.
Dated: May 14, 2003 By: /S/ YITZHAK N. BACHANA
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Yitzhak N. Bachana,
President
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated:
Dated: May 14, 2003 /S/ YITZHAK N. BACHANA
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Yitzhak N. Bachana, President,
Treasurer, Principal Executive
Officer, Principal Financial
Officer, Director