[ ICUT ] THE COMPLETE DD - International Cutlery, Ltd.
ICUT - International Cutlery, Ltd., 127 West 25th Street, New York,
NY 10001 PHONE: 212-924-7300 FAX: 212-627-5952
Started in 1967. Joel J. Silver was partner with brother until brother
passed away in 1975. Joel J. Silver then became CEO/CFO of private
corporation. IPO was held in September of 1994, taking International
Cutlery, Ltd. public. Stock price hit high of 10 dollars and averaged
around 8 before dropping to penny stock. Delisted from Nasdaq August
6, 1997.
FULLY REPORTING COMPANY expects next year end filing to be within 15
days of April 30, 1998. Mr. Silver says he expects this next report
to be a vast improvement over the last filing [see SEC filings] and
should show International Cutlery to be near profitability.
According to past SEC filings:
INSIDER SHARES:
Common Stock $.01 . . Joel J. Silver . . 1,014,192
/par value Plus conversion: 6,250,000 [Nov, 97]
TOTAL: 7,264,192
NOTE: 66.0% of company is held by Joel J. Silver, CEO.
. . . . . . . . . .Esther S. Silver . . . 225,564
. . . . . . . . . . .Caryn N. Silver . . . 225,564
. . . . . . . . . Lawrence N. Silver . . . 225,564
TOTAL SHARES ISSUED AND OUTSTANDING = 10,979,083
TOTAL SHARES HELD BY SILVERS: = 7,940,884 72.32%
TOTAL PUBLIC FLOAT = 3,038,199
OPERATION:
International Cutlery, Ltd. currently operates 22 retail cutlery
stores located in shopping malls located in New York, New Jersey,
Connecticut, Maryland and Florida. From a high of 33 stores, company
learned that mini-stores called kiosks were more efficient to run and
more profitable than larger mall stores, yet yielded similar results.
CEO Joel J. Silver used an example in my phone conversation with him
on April 1, 1998 that went roughly like this:
850 square foot retail stores might yield revenue of 90,000/month
month with 25,000 overhead, whereas a
120 square foot kiosk in the same mall might yield 80,000/month
with only 5,000 overhead.
So Mr. Silver is in the process of converting all of the International
Cutlery stores into the more profitable kiosks. This process is
mid-stream and has already generated excellent results. Company
currently operates 14 kiosks and 8 larger retail stores.
Christmas sales account for the majority of International Cutlery
revenue. This past Christmas season saw a 20% improvement over last
years same store sales. While many stores have yet to show a profit,
the increased revenue, coupled with the more efficient stores should
bring International Cutlery near profitability for the first time in
their 4 year public history.
PAST FINANCIAL STATEMENT AS OF OCTOBER 25, 1997:
CURRENT ASSETS:
Cash................................ $28,816
Inventories......................... 964,547
Other current assets.................. 2,327
Leasehold improvements.............1,349,206
Other assets.........................104,266
TOTAL..............................2,449,162
CURRENT LIABILITIES:
Note payable, related party .........$50,000
Accounts payables/liabilities......1,381,319
TOTAL..............................1,431,319
6 mo. ended October 25,1997......10-25-97..........10-26-96
SALES..........................$1,010,898..........$742,536
COST OF SALES ....................426,040...........246,391
GROSS PROFIT .....................584,858...........496,145
EXPENSES........................1,895,650.........1,611,285
LOSS FROM OPERATIONS ..........(1,310,792)......(1,115,140)
OTHER INCOME (EXPENSE):
Interest expense............... (10,091)...........(38,395)
Interest income ....................................60,902
NET LOSS .....................$(1,320,883)....$(1,092,633)
LOSS PER SHARE/COMMON STOCK...$.... (.28) ......$ ... (.28)
Highlights of December 9, 1997 filings:
Effective October 28, 1997, the Company changed its year end to the
period ending the Saturday closest to January 31.
During the twenty-six week period ended October 25,1997 (the "Current
Period"), the Company's revenues increased 36.1% to $1,010,898 from
$742,536 for the period from April 26, 1996 to October 26, 1996. The
increase in revenues is partially attributable to an increase in the
number of retail outlets operated by the Company during the Current
Period.
In October 1997, the Company received a line of credit from Sharp of
Florida, Inc. whereby the Company may receive advances up to
$1,300,000.
Cash requirements for the foreseeable future will include funds needed
to sustain the cash used in operations and additional capital to open
new stores to achieve a level of profitability. The Company believes
that cash from operations in addition to amounts available with the
line of credit available from Sharp of Florida, Inc. will be adequate
to meet the Company's anticipated requirements for working capital,
and capital expenditures for the next 12 months.
Effective October 10, 1997, the Certificate of Incorporation of the
Company was amended to increase the aggregate number of shares of the
Company's common stock, $0.01 par value per share, from 10,000,000
shares to 40,000,000 shares. Shareholders also approved a 1 for 20
reverse split.
NOTE: In my conversation with Mr. Silver, he stated that though he is
approved for dilution and reverse, he understands that it is "no way
to build a company" and that, being the largest shareholder, he would
be the one most affected by this action. He stated he was not
interested in diluting stock for the sake of raising money, nor would
he initiate the reverse option.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Rande Is
~~~~NOTE: Nothing presented herein constitutes a recommendation to
buy or sell any stock. The material contained herein is research
performed by a private investor, not responsible for accuracy. Before
investing in ICUT or any stock, do your own research. Penny stocks
are considered by this investor to be a gamble and not an investment.
I currently hold a small long position in ICUT. |
