Saw that, no news that I can find. Aug 6 filing, maybe they are ready to catch up filings.
August 6, 1999
JR CONSULTING INC (JRCI)
Quarterly Report (SEC form 10QSB)
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
The gross margin for the Issuer for the quarter ended March 31, 1998, is substantially higher than the gross margin for the
corresponding period in the previous year ($509,000 compared with $312,000). Also the operating loss is significantly lower
for the quarter ended March 31, 1998 compared with the operating loss for the corresponding period in the previous year
($214,000 compared with $257,000).
The gross margin for the nine months ended March 31, 1999, is higher than the gross margin for the corresponding period in
the previous fiscal year ($1,305,000 compared with $1,113,000). The operating loss is also higher by a material margin for the
nine months ended March 31, 1998, compared with the operating loss for the corresponding period in the previous fiscal year
($685,000 compared with $536,000). Since Que was not in existence for the first six months of the nine months ended March
31, 1998, any comparison of the consolidated results of the Issuer between the two periods of nine months is not indicative of
the real performance of the Issuer.
The exceptional items in the nine months to March 31, 1998 make any comparison of the Issuer's net losses for the nine months
ended March 31, 1999 and 1998 meaningless. The nine months to March 31, 1998 have much better results because of the
exceptional items.
The performance of Benatone in both the last quarter and the nine months ended March 31, 1998 revealed no clear direction
when compared with the corresponding periods in the previous year with losses being increased for the quarter by $8,000 and
reduced by $19,000 for the nine months. However these results are not indicative of the real performance of the company.
Benatone ceased trading at the beginning of calendar year 1999. This was necessary because of the damage done to the
company (in both sales and financial terms) in two consecutive years by allegations that the fuses used in its Simplug were faulty
and dangerous. In both years these allegations were proven to be wrong. Nevertheless as a result of recommendations to the
industry not to use any electrical appliance using the fuses made by the company's manufacturer, Benatone was unable to make
any sales of its product during the peak period of its annual business cycle. No alternative suppliers of fuses were viable despite
checking the market and evaluating the alternatives. Believing that the problem created in the quarter ended December 31,
1997 would not be repeated, management continued operating throughout calendar year 1998. When the problem was
repeated in the fiscal quarter ended December 31, 1998, and again the allegations were proven to be wrong, management
decided that it could not continue to subsidise the lost sales that were not of its own making. Thus the only change to the
financial position of Benatone during the quarter ended March 31, 1999 is the fixed and overhead SG&A expenses that the
company could not avoid during the quarter. These amounted to $38,000 but will be lower in subsequent quarters. Thus sales
have declined in the quarter ended March 31, 1999 compared with the corresponding period in the previous fiscal year by a
very large amount (no sales compared with $99,000). Similarly sales have declined in the nine months ended December 31,
1998 compared with the corresponding period in the previous fiscal year ($97,000 compared with $465,000). The SG&A
expenses in the quarter ended March 31, 1999 have declined compared with the corresponding period in the previous fiscal
year ($38,000 compared with $46,000 - including the reversal of an over provision of $38,000 in the previous year). Similarly
SG&A expenses have declined in the nine months
ended March 31, 1999 compared with the corresponding period in the previous fiscal year ($150,000 compared with
$239,000). Nevertheless, management is continuing to discuss production of a new plug, approved by the British Standards
Institution, in commercial quantities with the current manufacturers and other possible manufacturers at a significantly lower
cost. Providing this can be achieved and the market improves, management will restart the business. There can be no guarantee
that these conditions will be met in the future in which case alternative strategies will need to be found to avoid all ongoing
expenses.
The performance of Prima in the quarter ended March 31, 1999, showed a small decline on the corresponding period in the
previous year (an operating loss of $12,000 compared with $8,000). The improvement in the nine months ended March 31,
1999 compared with corresponding period in the previous year was significant (an operating loss of $17,000 compared with
$107,000). The quarter ended March 31, 1999 is different from the previous two fiscal quarters in that the sales increased
compared with the corresponding period in the previous year ($251,000 compared with $228,000). However sales remained
significantly lower for the nine months ended March 31, 1999 compared with the corresponding period in the previous year
($703,000 compared with $953,000). Prima appears to have reached a plateau where the SG&A expenses are no longer
declining. With higher sales there will be the inevitable increase in SG&A expenses. The SG&A expenses were $224,000 for
the quarter ended March 31, 1999 compared with $225,000 for the corresponding period in the previous year. The SG&A
expenses for the nine months ended March 31, 1999 were $616,000 which is significantly lower than the $1,025,000 for the
corresponding period in the previous year. During the quarter ended March 31, 1999, the premises were moved to Suite 710,
6100 Wilshire Boulevard, Los Angeles, California 90048. Even with this disruption, during this quarter, sales were maintained
at the levels of the previous year and SG&A expenses did not rise compared with the previous year. Maintaining the lower
SG&A expenses and at the same time expanding sales remains the main task of management.
The talent agency, Que Management, Inc., was started on January 5, 1998 in New York and therefore a proper comparison of
the nine months ende March 31, 1999 with the previous year is not possible. For the quarter ended March 31, 1999 the
company has shown continued improvement compared with the previous year. The sales have increased from $62,000 to
$259,000. The SG&A expenses have also increased but by proportionately less than the sales increase. The SG&A expenses
for the quarter ended March 31, 1999 were $279,000 compared with $183,000 in the previous year. Although this
improvement in the SG&A expenses would be partly expected because there were some start-up costs in the previous year,
the overall result is very close to the forecast made by management. The loss for the quarter ended March 31, 1999 is $32,000
compared with $121,000 in the previous year. For the nine months ended March 31, 1999 the sales were $578,000, the
SG&A expenses were $838,000 and the net loss after interest charges was $247,000. Management of Que is continuing to
expand the sales while keeping the expenses under control. |
