Sibannac, Inc. - Quarter Report: 2014 May (Form 10-Q)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
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x
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QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACTOF 1934
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For the quarterly period ended May 31, 2014
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o
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TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from ____________ to ______________
Commission File Number: 333-122009
NAPRODIS, INC.
(Exact Name of Registrant as Specified in its Charter)
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Nevada
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33-0903494
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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13250 Gregg St., Suite F, Poway, CA 92064
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number including area code: (858) 486-8655
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N/A
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Former name, former address, and former fiscal year, if changed since last report
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Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities 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 o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
Indicate by check mark whether registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 4,990,000 shares outstanding as of May 31, 2014.
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NAPRODIS, INC.
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BALANCE SHEETS
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(Unaudited)
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May 31,
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August 31,
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2014
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2013
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| ASSETS | ||||||||
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Current Assets
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Cash
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$ | 10,896 | $ | 3,542 | ||||
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Accounts Receivable
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39,140 | 22,431 | ||||||
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Inventories, net
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17,794 | 19,923 | ||||||
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Total Current Assets
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67,830 | 45,896 | ||||||
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Property and equipment, net
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17,319 | 25,959 | ||||||
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Long-Term Inventories
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71,175 | 119,534 | ||||||
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Other Assets
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10,159 | 10,159 | ||||||
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TOTAL ASSETS
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$ | 166,483 | $ | 201,548 | ||||
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TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT
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Current Liabilities
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Accounts Payable and accrued expenses
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$ | 356,583 | $ | 239,757 | ||||
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Accrued payroll and payroll taxes
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2,108 | 1,783 | ||||||
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Accrued Interest
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43,761 | 52,517 | ||||||
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Customer Deposits
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1,250 | 2,319 | ||||||
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Payables to related party
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139,308 | 139,586 | ||||||
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Officer Loans
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202,101 | 216,737 | ||||||
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Total Liabilities
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745,111 | 652,699 | ||||||
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Stockholders' Deficit
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Preferred stock, $0.001 par value,
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10,000,000 shares authorized, 0 shares issued
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- | - | ||||||
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Common Stock, $0.001 par value,
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60,000,000 shares authorized;
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4,990,000 isssued and outstanding at
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May 31, 2014 and August 31, 2013
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4,990 | 4,990 | ||||||
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Additional paid-in capital
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131,260 | 131,260 | ||||||
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Deficit
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(714,878 | ) | (587,401 | ) | ||||
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Total Stockholders's Deficit
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(578,628 | ) | (451,151 | ) | ||||
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TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT
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$ | 166,483 | $ | 201,548 | ||||
The accompanying notes are an integral part of these unaudited financial statements
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NAPRODIS INC.
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STATEMENT OF OPERATIONS
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(unaudited)
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For the three months ended
May 31,
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For the nine months ended
May 31,
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2014
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2013
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2014 | 2013 | |||||||||||||
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Revenues
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$ | 66,091 | $ | 37,913 | $ | 161,853 | $ | 156,414 | ||||||||
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Cost of sales, (exclusive of depreciation, included ingeneral & administrative expenses)
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9,699 | 15,238 | 64,693 | 29,911 | ||||||||||||
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Gross profit
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56,392 | 22,675 | 97,160 | 126,503 | ||||||||||||
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Selling expenses
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2,661 | 246 | 7,573 | 6,828 | ||||||||||||
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General and administrative expenses
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Occupancy costs
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34,509 | 33,880 | 102,843 | 100,492 | ||||||||||||
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Salaries and wages
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2,537 | 2,802 | 7,913 | 7,145 | ||||||||||||
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Other general and administrative expenses
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18,027 | 14,439 | 94,293 | 65,570 | ||||||||||||
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Total general and administrative expenses
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55,073 | 51,121 | 205,049 | 173,207 | ||||||||||||
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Net Loss before other income and expenses
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Interest expense
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(4,112 | ) | (630 | ) | $ | (12,015 | ) | (9,525 | ) | |||||||
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Net Loss
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$ | (5,454 | ) | $ | (29,322 | ) | $ | (127,477 | ) | $ | (63,057 | ) | ||||
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Net Loss per share - basic and diluted
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$ | (0.00 | ) | $ | (0.01 | ) | $ | (0.03 | ) | $ | (0.01 | ) | ||||
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Weighted average common shares
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outstanding - basic and diluted
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4,990,000 | 4,990,000 | $ | 4,990,000 | 4,990,000 | |||||||||||
The accompanying notes are an integral part of these unaudited financial statements
3
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NAPRODIS, INC.
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STATEMENT OF CASH FLOWS
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(Unaudited)
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For the nine months ended
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May 31,
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2014
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2013
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Operating Activities
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Net loss
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$ | (127,477 | ) | $ | (63,057 | ) | ||
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Adjustments to reconcile net loss to net cash used in operations:
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Depreciation
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10,923 | 10,305 | ||||||
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Changes in operating assets and liabilities:
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Accounts Receivable
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(16,709 | ) | (16,317 | ) | ||||
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Inventory
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50,488 | 5,766 | ||||||
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Accounts Payable and accrued expenses
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116,826 | 63,472 | ||||||
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Accrued payroll and payroll taxes
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325 | - | ||||||
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Accrued Interest
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(8,756 | ) | - | |||||
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Customer Deposits
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(1,069 | ) | 7,335 | |||||
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Net Cash provided by operating activities
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24,551 | 7,504 | ||||||
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Investing Activities
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Cash paid for purchase of fixed assets
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(2,283 | ) | - | |||||
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Net cash provided by investing activities
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(2,283 | ) | - | |||||
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Financing Activities
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Proceeds (repayment) from officer loans
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(14,636 | ) | 3,372 | |||||
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Proceeds (repayment) of payable to related party
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(278 | ) | (422 | ) | ||||
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Net Cash provided by financing activities
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(14,914 | ) | 2,950 | |||||
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Net Increase (Decrease) in cash
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7,354 | 10,454 | ||||||
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Cash, beginning of period
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3,542 | 648 | ||||||
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Cash, end of period
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$ | 10,896 | $ | 11,102 | ||||
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Supplemental disclosures of cash flow information
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Cash paid for
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Interest
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$ | - | $ | - | ||||
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Income taxes
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- | - | ||||||
The accompanying notes are an integral part of these unaudited financial statements
4
NOTE 1 – BASIS OF PRESENTATION AND NATURE OF BUSINESS
Nature of Business
Naprodis, Inc. (the “Company”) is a pharmaceutical manufacturer, supplying natural raw materials and natural health care products to the health supplement and beauty product industry. The Company also markets its own line of beauty products from its offices and laboratory in Poway, California.
Basis of Presentation
The financial statements presented include all adjustments which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows for the period presented in accordance with the accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature
These unaudited interim financial statements as of and for the three and nine months ended May 31, 2014 reflect all adjustments which, in the opinion of management, are necessary to fairly state the Company’s financial position and the results of its operations for the periods presented, in accordance with the accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature.
These unaudited interim financial statements should be read in conjunction with the Company’s financial statements and notes thereto included in the Company’s fiscal year end August 31, 2013 report on Form 10-K. The Company assumes that the users of the interim financial information herein have read, or have access to, the audited financial statements for the preceding period, and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The results of operations for the nine month period ended May 31, 2014 are not necessarily indicative of results for the entire year ending August 31, 2014.
NOTE 2 – GOING CONCERN
As shown in the financial statements, the Company incurred a net loss of $127,477 during the nine months ended May 31, 2014, and as of that date, the Company’s current liabilities exceeded its current assets by $677,281. The Company has an accumulated deficit of $714,878. These factors create an uncertainty regarding the Company’s ability to continue as a going co concern. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
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NOTE 3 – PAYABLES TO RELATED PARTIES
The following payables to companies that are related by common ownership are payable on demand and have no terms of repayment or maturity date. The payables to Solde Naprodis and Phybiosis accrue interest at 5% per annum, while the amount due to Loresys is non-interest-bearing:
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May 31,
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August 31,
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2014
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2013 | |||||||
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Solde Naprodis, Inc.
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$ | 3,198 | $ | 3,198 | ||||
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Phybiosis, Inc.
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120,105 | 120,105 | ||||||
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Loresys
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16,005 | 16,283 | ||||||
| $ | 139,308 | $ | 139,586 | |||||
NOTE 4 – OFFICER LOANS
Loans from the following officers of the Company have no terms of repayment or maturity, are payable on demand and bear interest at 5% per annum.
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May 31,
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August 31,
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2014
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2013 | |||||||
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Paul Petit
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$ | 82,829 | $ | 106,378 | ||||
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Alain Petit
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32,854 | 23,973 | ||||||
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Kelley Thompson
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67,459 | 67,427 | ||||||
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Jean-Phillipe Petit
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5,000 | 5,000 | ||||||
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Antoine Lagomarsino
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6,459 | 6,459 | ||||||
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Guillaume Petit
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7,500 | 7,500 | ||||||
| $ | 202,101 | $ | 216,737 | |||||
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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
This report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties and are based on the beliefs and assumptions of management and information currently available to management. The use of words such as “believes”, “expects”, “anticipates”, “intends”, “plans”, “estimates”, “should”, “likely” or similar expressions, indicates a forward-looking statement.
The identification in this report of factors that may affect our future performance and the accuracy of forward-looking statements is meant to be illustrative and by no means exhaustive. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty.
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operation
General
The Company was incorporated in Nevada in June 1999.
Since September 2000 the Company has been in the business of selling dietary and personal care products. The Company distributes its products primarily through private label resellers and through spas, beauty salons, health professionals, and health and beauty stores. As of the date of this report the Company’s products were being sold in the United States and Canada along with several foreign countries. The Company relies upon referrals from its customers and it website to market its products.
Material changes of certain items in the Company’s Statement of Operations for the three and nine months ended May 31, 2014, as compared to the same periods last year, are discussed below.
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Increase (I)
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Item
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or Decrease (D)
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Reason
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Revenue
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I |
Addition of new customers.
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Gross profit, as a percent of total revenue (three month period)
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I |
Increased prices for products.
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| Gross profit, as a percent of total revenue (nine month period) | D |
Increased cost of raw materials.
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| General and Administrative expenses | I | New purchases due to new clients | |||
7
The Company does not know of any trends, events or uncertainties that have had, or are reasonably expected to have, a material impact on sales, revenues or income from continuing operations, or liquidity and capital resources.
Research and Development
During the past two years the Company research and development expenses have been less than $1,500. However, the Company believes that in order to be competitive it will need to commit to continuous product innovation and improvement through research. Research efforts will combine in-house research, published research, and clinical studies and will involve the following:
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Investigation of the in vitro activity of new natural extracts,
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Identification and research of combinations of nutrients that may be suitable for new products,
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Analysis of the benefits of existing and newly identified nutritional supplements,
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Improvement of existing products following new discoveries in nutrition, and
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Improvements to manufacturing processes.
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Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
An evaluation was carried out under the supervision and with the participation of our management, including our Principal Executive Officer and Principal Financial Officer, of the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report on Form 10-Q. Disclosure controls and procedures are procedures designed with the objective of ensuring that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, such as this Form 10-Q, is recorded, processed, summarized and reported, within the time period specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and is communicated to our management, including our Principal Executive Officer and Principal Financial Officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Based on that evaluation, our management concluded that, as of May 31, 2014, our disclosure controls and procedures were effective.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting during the quarter ended May 31, 2014, that materially affected or are reasonably likely to materially affect our internal control over financial reporting.
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PART II
Item 6. Exhibits
a. Exhibits
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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.
| NAPRODIS, INC. | |||
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Date: June 30, 2014
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By:
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/s/ Paul Petit | |
| Paul Petit, President, Principal Executive, | |||
| Financial and Accounting Officer | |||
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