Form 10Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Quarterly Report Under Section 13 or 15 (d)
of the Securities Exchange Act of 1934
For Quarter Ended: May 31, 2002
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Commission File Number: 0-11050
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Mammatech Corporation
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(Exact name of registrant as specified in its charter)
Florida 59-2181303
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
930 N.W. 8th Avenue, Gainesville, Florida 32601
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(Address of principal executive offices) (Zip Code)
(352) 375-0607
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(Registrant's 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 ninety days. Yes X No
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Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:
Number of shares outstanding on
May 31, 2002
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100,352,500 shares of which
7,408,500 are treasury shares
TITLE OF EACH CLASS
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Common stock $.0001 par value
The total number of pages of this report is 11
Mammatech Corporation
INDEX
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PART I.
FINANCIAL INFORMATION PAGE NO.
Item 1. Financial Statements
Statements of Operations for Three Months
Ended May 31, 2002 and May 31, 2001...........................3
Balance Sheets for May 31, 2002
August 31, 2001...............................................4-5
Statement of Cash Flow for the Quarter
Ended May 31, 2002 ...........................................6
Statements of Cash Flow for the Quarter
Ended May 31, 2001............................................7
Notes to Financial Statements for the Quarter
Ended May 31, 2002............................................8
Item 2. Management's Discussion and Analysis of
Financial Conditions and Results of Operations............... 9
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.....................10
SIGNATURES................................................... 11
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Mammatech Corporation
Statements of Operations
(Unaudited)
Nine Months Ended Three Months Ended
May May May May
2002 2001 2002 2001
Sales, net $ 266,555 310,224 $ 113,226 102,774
Cost of sales 73,529 68,489 32,093 25,700
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Gross Profit 193,026 241,735 81,132 77,074
Selling, general and
adminstrative expense $ 263,053 357,834 79,281 112,130
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Operating Income (70,027) (116,099) 1,851 (35,056)
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(Loss)
Other income (expense) 2,400 -- -- --
Interest & Dividend Income 19,998 28,615 5,774 11,415
SBIR Grant reimb -- 38,555 -- --
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22,398 67,170 5,774 11,415
Utilization of oper.
loss carryforward -0- -0- -0- -0-
Net income before taxes (47,629) (48,929) 7,625 (23,641)
Provision for income tax -0- -0- -0- -0-
NET INCOME (LOSS) (47,629) (48,929) 7,625 (23,641)
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Net income (loss) per share .00 .00 .00 .00
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Weighted average shares 100,362,500 100,362,500 100,362,500 100,362,500
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The accompanying notes are an integral part of the financial statements.
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Mammatech Corporation
Balance Sheets
May 31, 2002 Aug. 31, 2001
(Unaudited) (Audited)
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ASSETS
Cash and Cash Equivalents $ 590,814 578,054
Marketable Securities 217,908 217 908
Accounts receivable:
Trade 64,867 128,861
Other -- -0-
Inventory 93,667 105,448
Other current assets
Deferred tax asset-
current portion 5,100 5,100
Total Current Assets 972,356 1,035,371
Property and equipment 11,781 26,488
Other assets:
Deferred tax asset-
Non current portion 164,100 161,890
Patents, trademarks, and
other intangibles, net of
accumulated amortization
of $53,080 and $46,942
respectively 16,291 18,716
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Total other assets 180,391 180,606
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TOTAL ASSETS $1,164,528 $1,242,465
The accompanying notes are an integral part of the financial statements.
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Mammatech Corporation
Balance Sheets
As of August 31, 1999
and May 31, 2001
(continued)
May 2002 Aug 2001
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LIABILITIES AND STOCKHOLDERS' EQUITY
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CURRENT LIABILITIES
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Accounts payable-trade $ 8,047 $ 24,433
Accrued payable-officer 6,630 6,630
Current portion of long term debt 6,260 6,260
Accrued salaries 413,175 416,189
Accrued royalties 71,570 71,570
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TOTAL CURRENT LIABILITIES 505,682 525,082
COMMITMENTS
Long term debt -- --
Stockholders' equity:
Common stock, par value $.0001;
200,000,000 shares authorized;
80,352,500 shares issued
and outstanding $ 10,046 $ 10,046
Additional paid-in capital 2,811,183 2,811,183
Accumulated deficit (1,949,476) (1,890,939)
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871,753 930,290
Valuation allowance for
marketable securities (64,856) (64,856)
Treasury stock at cost,
6,208,500 shares ( 148,051) ( 148,051)
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658,846 717,383
TOTAL LIABILITIES AND $ 1,164,528 $ 1,242,465
STOCKHOLDERS' EQUITY
The accompanying notes are an integral part of these statements.
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Mammatech Corporation
Statement of Cash Flow
For the Nine Months Ending
May 31,2002
Net income (loss)
Adjustments to reconcile net income (loss) to net $ (47,629)
cash provided by operating activities:
Depreciation and amortization 16,500
Changes in assets and liabilties:
(Increase) decrease in accounts receivable 63,994
(Increase) decrease in inventory 11,781
(Increase) decrease in other assets (2,075)
(Increase) decrease in deferred tax asset (2,210)
Increase (decrease) in accounts payable (16,386)
Increase (decrease) in accrued expenses (8,207)
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Total adjustments
Net cash provided by operating activities 15,768
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Cash flows from investing activities:
Acquisition of property and equipment (3,008)
Net cash used in investing activities -0-
Cash flows from financing activities:
Repayment of note payable
Net cash used in financing activities -0-
Increase (decrease) in cash 12,760
Cash and cash equivalents, beginning of period 578,054
Cash and cash equivalents, beginning of period 590,814
The accompanying notes are an integral part of these statements.
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Mammatech Corporation
Statement of Cash Flow
For the Six Months Ending
May 31,2001
Net income (loss)
Adjustments to reconcile net income (loss) to net $ (48,929)
cash provided by operating activities:
Depreciation and amortization 10,500
Changes in assets and liabilties:
(Increase) decrease in accounts receivable 53,360
(Increase) decrease in inventory 31,867
(Increase) decrease in deferred tax asset (800)
Increase (decrease) in accounts payable (27,585)
Increase (decrease) in accrued expenses 91,688
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Total adjustments
Net cash provided by operating activities 110,101
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Cash flows from investing activities:
Acquisition of property and equipment
Net cash used in investing activities (18,227)
Cash flows from financing activities:
Repayment of note payable
Net cash used in financing activities (476)
Increase (decrease) in cash 91,398
Cash and cash equivalents, beginning of period 541,855
Cash and cash equivalents, beginning of period 633,253
The accompanying notes are an integral part of these statements.
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Mammatech Corporation
Notes to Financial Statements
May 31, 2002
Note 1. In the opinion of the Company, the accompanying unaudited financial
statements contain all adjustments (consisting of only normal
recurring accruals) necessary to present fairly the financialposition
as of May 31, 2002, and the results of operations and changes in
financial position for the three months ended May 31, 2002.
Note 2. Loss per share is based on the weighted average number of shares
outstanding during each period.
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITIONS AND RESULTS OF OPERATION FOR MAMMATECH CORPORATION
Results for the third quarter of Fiscal 2002 were encouraging, especially in
light of general economic conditions. Sales increased 33.4% over the previous
quarter and by 10.2% relative to the third quarter of 2001.The operating income
of $7,625 compares favorably to the losses of $13,327 in the previous quarter
and $23,641 during the year earlier quarter. The positive operating income is
primarily the result of ongoing marketing effort coupled with an 8.4% reduction
in operating costs compared to the previous quarter. Compared to the third
quarter of 2001, operating costs declined by 29.3%.
The nine month figures show a 14% decline in sales for the current year compared
to last year. This is coupled with a slight increase in cost of goods but a
substantial decline (26.5%) in operating costs. As a result, the loss for the
nine month period was slightly less than that for the period a year earlier. It
is impossible to ascertain whether the current quarter marks the beginning of a
turnaround or is instead a momentary perturbation in an otherwise steady
downward trend.
One year ago, the Company was visited by our German Distributor. Extensive
discussions were held concerning the future of MammaCare in Europe and specific
plans for expansion in Germany. Now, one year later, on May 14, the Frankfurter
Rundschau newspaper carried a half-page article announcing the creation of The
European MammaCare Training Center to be located at the University Clinic of
Frankfurt, Dept.of Women's Health Breast Center. Initial funding will be from
non-profit sources.The Company expects this program to become a base for
MammaCare training throughout Europe.
Concurrently, the Company is redesigning its Professional Training Program and
is now seeking to place it in medical schools and other institutions of higher
education. A licensing agreement designed to insure the traditional quality of
MammaCare training has been prepared and the first successful placement is
imminent. There can be no assurance, however, that the Company will be
successful in placing these licenses or, if successful, that substantial revenue
will result.
Finally, the Company received notification during the quarter of its success in
competing for an SBIR Phase I award. The intent of the proposed research is to
extend the MammaCare method of manual breast examination to enable clinicians to
conduct proficient examination on women with major physical disabilities. The
research will commence early in July.
The Company remains debt free and has no immediate liquidity problems.
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PART II - OTHER INFORMATION
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Item 6. Exhibits and Reports on Form 8-K
(a.) Exhibits - None
(b.) There were no reports filed on Form 8-K during the three months
ending May 31, 2002.
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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.
MAMMATECH CORPORATION
DATE: BY: /s/ Henry S. Pennypacker
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Henry S. Pennypacker
President and Director
BY: /s/ Mary Sellers
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Mary Sellers, Treasurer
and Chief Financial
Officer
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