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 Quarter Ended: June 30, 2002
[ ] Transition Report Under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the Transition Period from _____________ to ____________
Commission File Number: 0-26285
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AGE RESEARCH, INC.
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(Name of Small Business Issuer in its charter)
Delaware 87-0419387
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(State or other jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
31103 Rancho Viejo Road, #2102, San Juan Capistrano, CA 92675
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(Address of principal executive offices and Zip Code)
(800) 597-1970
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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 90 days.
(1) Yes [X] No [ ] (2) Yes [X] No [ ]
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Common Stock, Par Value $0.001 67,259,301
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Title of Class Number of Shares Outstanding
as of June 30, 2002
ITEM 1. FINANCIAL STATEMENTS
AGE RESEARCH, INC.
BALANCE SHEET (Unaudited)
June 30, 2002
ASSETS
2002
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Current Assets
Cash $ 345
Accounts Receivable 1,270
Inventory 95
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Total Current Assets 1,710
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Property and Equipment
Furniture and Fixtures 5,560
Machinery and Equipment 1,794
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7,354
Less: Accumulated Depreciation (7,354)
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Total Property and Equipment -
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TOTAL ASSETS $ 1,710
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable and Accrued Expenses $ 10,772
Officers' Loan 8,500
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Total Current Liabilities 19,272
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Stockholders' Equity
Common stock, $.001 par value, 100,000,000
shares authorized, 67,259,301 shares issued
and outstanding 67,259
Paid-in Capital 730,264
Accumulated Deficit (815,085)
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Total Stockholders' Deficit (17,562)
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,710
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See notes to interim unaudited financial statements.
AGE RESEARCH, INC.
STATEMENTS OF OPERATIONS (Unaudited)
Three Months ended Six Months ended
June 30, June 30,
2002 2001 2002 2001
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SALES $ 1,888 $ 2,208 $ 4,961 $ 4,330
COST OF GOODS SOLD 265 351 692 692
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GROSS PROFIT 1,623 1,857 3,638 3,638
SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES 3,881 2,458 9,065 8,901
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OPERATING (LOSS) (2,258) (601) (4,828) (5,272)
OTHER INCOME (EXPENSES)
Interest and other income - 29 - 83
Interest expense (109) - (201) -
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(109) 29 (201) 83
NET LOSS BEFORE TAXES (2,367) (572) (5,029) (5,189)
PROVISION FOR INCOME TAXES - - 800 800
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NET LOSS $ (2,367) (572) (5,829) (5,989)
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LOSS PER SHARE - BASIC AND DILUTED $ (0.00) $ (0.00) $ (0.00) $ (0.00)
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WEIGHTED AVERAGE NUMBER OF SHARES 67,259,301 67,259,301 67,259,301 67,259,301
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See notes to interim unaudited financial statements.
AGE RESEARCH, INC.
STATEMENTS OF CASH FLOWS (Unaudited)
For Six Months Ended
2002 2001
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CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) $ (5,829) (5,989)
Adjustment to reconcile net (loss) to
net cash (used in) operating
activities:
Depreciation - 32
(Increase) Decrease in:
Accounts Receivable (341) 31
Inventory 158 692
Increase (Decrease) in:
Accounts Payable and Accrued Expenses 2,087 (946)
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Net Cash Used in Operating Activities (3,925) (6,180)
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CASH FLOWS FROM INVESTING ACTIVITIES - -
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CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from Officers' Loan 2,300 5,000
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Net Cash Provided by Financing Activities 2,300 5,000
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NET (DECREASE) IN CASH AND
CASH EQUIVALENTS (1,625) (1,180)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 1,970 1,823
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CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 345 $ 643
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SUPPLEMENTARY DISCLOSURES:
Interest Paid $ - $ -
Income Taxes Paid $ - $ 800
See notes to interim unaudited financial statements.
AGE RESEARCH, INC.
NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Business
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Age Research, Inc. (the "Company") produces and sells a line of premium skin
care products to physicians and mail order. The Company has developed its own
line of dermatologist-formulated skin care products including moisturizers,
cleaners, sunscreens, and anti-aging emollients with glycolic acid. The
products are sold under the name of RejuvenAge, which is trademarked in U.S.
and U.K., and name of Bladium, which is trademarked in U.S.. The trademark in
U.K. will be expired in September, 2006.
Presentation of Interim Information
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In the opinion of the management of Age Research, Inc. (the "Company"), the
accompanying unaudited financial statements include all normal adjustments
considered necessary to present fairly the financial positions as of March 31,
2002, and the results of operations and cash flows for the three months ended
March 31, 2002 and 2001. Interim results are not necessarily indicative of
results for a full year.
The financial statements and notes are presented as permitted by Form 10-QSB,
and do not contain certain information included in the Company's audited
financial statements and notes for the fiscal year ended December 31, 2001.
New Accounting Standards:
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SFAS No. 143, "Accounting for Asset Retirement Obligations," addresses
financial accounting and reporting for obligations associated with the
retirement of tangible long-lived assets and the associated asset retirement
costs. The statement requires that the fair value of a liability for an asset
retirements obligation be recognized in the period it is incurred if a
reasonable estimate of fair value can be made. The associated retirement
costs are capitalized as a component of the carrying amount of the long-lived
asset and allocated to expense over the useful life of the asset. The
statement is effective for financial statements issued for fiscal years
beginning after June 15, 2002. Management believes the adoption of the
statement will not have a material effect on the Company's financial
statements.
In August 2001, SFAS No. 144, "Accounting for the Impairment or Disposal of
Long-Lived Assets," was issued and establishes accounting and reporting
standards for the impairment or disposal of long-lived assets. This statement
supersedes SFAS No. 121, "Accounting for the impairment of Long-Lived Assets
and for Long-Lived Assets to be Disposed." SFAS No. 144 provides one
accounting model to be used for long-lived assets to be disposed of by sale,
whether previously held for use or newly acquired and broadens the
presentation of discontinued operations to include more disposal transactions.
The provisions of SFAS No. 144 are effective for financial statements issued
for fiscal years beginning after December 15, 2001. Accordingly, the
statement was effective for the Company for the fiscal quarter beginning
January 1, 2002 and it did not have an impact on its financial position.
NOTE 2 - NET LOSS PER SHARE
Net loss per share is computed based on the weighted average number of shares
of common stock outstanding during the period. Basic net loss per share was
$0.00 for all periods for the three and six months ended June 30, 2002 and
2001. Diluted net loss per share is the same as basic net loss per share due
to the lack of dilution items in the Company.
Three Months ended Six Months ended
June 30, June 30,
2002 2001 2002 2001
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Numerator:
Net Loss $ (2,367) $ (572) $ (5,829) $ (5,989)
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Denominator:
Weighted Average Shares 67,259,301 67,259,301 67,259,301 67,259,301
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Basic and Diluted Net Loss Per Share $ (0.00) $ (0.00) $ (0.00) $ (0.00)
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NOTE 3 - SEGMENT INFORMATION
SFAS No. 131 "Disclosures about Segments of an Enterprise and Related
Information" requires that a publicly trade company must disclose information
about its operating segments when it presents a complete set of financial
statements. Since the Company has only one segment; accordingly, detailed
information of the reportable segment is not presented.
NOTE 4 - RELATED PARTY TRANSACTION
An officer is currently making payments to purchase inventory on behalf of the
Company. As of June 30, 2002, the balance due to the officer related to
purchases was $789 and is included in the Company's accounts payable and
accrued expenses. The Company also has notes payable to the officer in the
amount of $8,500, accruing interest at 6% per annum.
NOTE 5 - GOING CONCERN
As shown in the accompanying financial statements, the Company incurred a net
loss of $5,829 and $5,989 for the six months ended June 30, 2002 and 2001,
respectively, and as of June 30, 2002, the Company's current liabilities
exceeded current assets by $17,562. These factors create uncertainty about
the Company's ability to continue as a going concern.
Management is currently involved in active negotiations to obtain additional
financing and actively increasing marketing efforts to increase revenues. The
Company's continued existence depends on its ability to meet its financing
requirements and the success of its future operations. The financial
statements do not include any adjustments that might result from the outcome
of this uncertainty.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS
Cautionary Statement Regarding Forward-looking Statements
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This report may contain "forward-looking" statements. Examples of forward-
looking statements include, but are not limited to: (a) projections of
revenues, capital expenditures, growth, prospects, dividends, capital
structure and other financial matters; (b) statements of plans and objectives
of the Company or its management or Board of Directors; (c) statements of
future economic performance; (d) statements of assumptions underlying other
statements and statements about the Company and its business relating to the
future; and (e) any statements using the words "anticipate," "expect," "may,"
"project," "intend" or similar expressions.
Results of Operations
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Three and Six Months Ended June 30, 2002 compared to June 30, 2001
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Revenues and Costs of Sales. For the three and six month period ended June
30, 2002, our revenues were $1,888 and $4,961, respectively, with cost of
goods sold of $265 and $724, for a gross profit of $1,623 and $4,237,
respectively. For the three and six month period ended June 30, 2001, our
revenues were $2,208 and $4,330 with cost of goods sold of $351 and $692, for
a gross profit of $1,857 and $3,638, respectively.
Operating Expenses. Total operating expenses for three and six month period
ended June 30, 2002 were $3,881 and $9,068, respectively compared to $2,458
and $8,910 for 2001. The net losses from operations for the three and six
months ended June 30, 2002 were $2,258 and $4,828, compared to net losses from
operations of $601 and $5,272 for the three and six month period ended June
30, 2001.
Liquidity and Capital Resources
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Historically, we have financed our operations through a combination of cash
flow derived from operations and debt and equity financing. At June 30, 2002,
we had a working capital deficit of $17,562 based on current assets of $1,710
and current liabilities of $19,272.
Based on our current marketing program and sales, it is clear that we will
have to increase our sales volume significantly in order to have profitable
operations. At this time, however, we do not have any working capital to
expand our marketing efforts.
We propose to finance our needs for additional working capital through some
combination of debt and equity financing. Given our current financial
condition, it is unlikely that we could make a public sale of securities or be
able to borrow any significant sum from either a commercial or private lender.
The most likely method available to us would be the private sale of our
securities. There can be no assurance that we will be able to obtain such
additional funding as needed, or that such funding, if available, can be
obtained on terms acceptable to us.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
None.
ITEM 2. CHANGES IN SECURITIES
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.
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Exhibit 99 - CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
(b) Reports on Form 8-K.
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None.
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.
Age Research, Inc.
Dated: August 12, 2002 By:/S/Richard F. Holt, President
(Chief Executive and Financial Officer)