I agree!!!!!!!!.....I love it.......And here's one for You......
USTI.....Shows a Profit!!!!!!!!!....Up over 44%....Before news came out this week.....
Psychopop
ame: Psychopop
E-Mail:
Subject: USTI ......Turns a Profit!!!!!!!!!!!!!!!!!!...............................
Body of Message:
To: +Psychopop (194 )
From: +Psychopop
Friday, Aug 14 1998 5:26PM ET
Reply # of 195
NEWS is OUT.....USTI TURNS A PROFIT!!!!!!!!!!!!!
UNITED SYSTEMS TECHNOLOGY INC
Filed on Aug 14 1998
Management's Discussion and Analysis of Financial Condition or Plan of Operation
Results of Operations - The Company derives its revenue from the licensing of its
software packages,
installation, training and customer modifications, maintenance agreements and equipment
sales and
commissions. Results of operations for the three month period ended June 30, 1998
include revenues of
$418,252 and net income of $17,012 as compared to revenues of $363,160 and a net
loss of $80,285 for
the same period in 1997. Results for the six month period ended June 30, 1998 include
revenues of
$785,831 and net income of $2,665 as compared to revenues of $821,639 and a net
loss of $86,703 in
1997.
The Company's expenses continued to be adjusted downward during 1998. The
Company is continuing its
development of its asystTM product line, a Windows product line that operates in a
single user or network
environment and is seamlessly interfaced with the other Microsoft Office products. The
asystTM product
line has been installed at over 170 locations and includes General Ledger, Accounts
Payable, Accounts
Receivable, Cash Receipts, Purchase Orders, Budgeting, Reporting, and Utility Billing
modules. The
Company believes that its asystTM product line will continue to offer its current and
prospective customers
with an attractive software solution, both from a financial and functionality standpoint
and follows the trend
of clients moving to PC networks. This trend resulted in a continued decrease in the
licensing of the
Company's DOS (QuestTM ) and mid-range (LegacyTM ) products in 1998. The
Company is offering a
Year 2000 version of certain QuestTM and LegacyTM modules and expects to begin
shipping these
products in the 4th quarter of 1998.
Three Month Period Ended June 30, 1998 and 1997 - The Company's total revenue
increased 15% from
$363,160 during the second quarter in 1997 to $418,252 in 1998. Software license
fees increased 73% in
1998 due, in part, to an increase in the licensing of the Company's asystTM products.
The Company
continues to market its products to prospective customers, which it believes are best
suited for its products.
Installation and training increased 32% in 1998 due to an increase in amount of custom
programming
requested by customers. Maintenance revenue decreased 3% during 1998, due in part,
to a decrease in the
number of the Company's QuestTM and LegacyTM customers that elected to select
maintenance coverage.
Equipment and supplies sales increased 62% in the second quarter of 1998 due, in part,
to an increase in
the volume of computer equipment sold in conjunction with its products.
Six Month Period Ended June 30, 1998 and 1997 - The Company's total revenue
decreased 4% from
$821,639 during the first six months of 1997 to $785,831 in 1998. Software license
fees remained
consistent with 1997 levels in 1998. Installation and training decreased 17% in 1998
due to a decrease in
the licensing of the Company's minicomputer products during 1998, which require a
higher amount of these
types of services. Maintenance revenue decreased 6% during 1998, due in part, to a
decrease in the
number of the Company's QuestTM and LegacyTM customers that elected to select
maintenance coverage.
Total costs and expenses decreased 13% from $906,445 in 1997 to $784,789 in
1998. Salary expense
decreased 19% in 1998 as a result of the Company's continued adjustments in staffing
to align with its
anticipated levels of revenue. Other general, administrative and selling expense costs
decreased 6% in 1998
as a result of continued efforts to control or reduce expenses. Depreciation and
amortization expense
decreased 15% in 1998. Commission expense decreased 32% in 1998 due, in part, to
a decrease in the
volume of licensing the Company's software by agents in 1998. Cost of equipment and
supplies sold
increased 15% as a result of increased sales of computer equipment during the period.
Liquidity and Capital Resources - The Company had net cash provided from operating
activities of $41,174
during the six months ended June 30, 1998, as compared to net cash used by
operations of $28,613 for the
same period in 1997. Net cash of $13,844 was utilized during 1998 for investing in
capital expenditures as
compared to $15,983 in 1997.
Management believes that the effect of its continued focus on adjusting the Company's
expenses to the level
of revenue, which management anticipates achieving, and the Company's current cash
balance will be
adequate to meet its working capital requirements in the near future. However, if the
Company is not able to
continue to generate positive cash flows in the future by achieving a level of sales
adequate to support the
Company's cost structure, additional financing may be required, of which there can be
no assurance.
The Company had a $50,000 note payable to Ventana Growth Fund ("Ventana"), a
related party. Ventana
distributed this note to its limited partners in its fund in 1997 and instructed the
Company to reissue notes,
under the same terms and conditions, to the limited partners. The maturity date of the
note was extended
from September 30, 1996 to September 30, 1998. The original maturity date of this
note was October 17,
1987. As of June 30, 1998 there was $78,156 of interest outstanding on the note.
The Company is currently in arrears in the payment of dividends to holders of its
preferred stock. As of June
30, 1998, dividends were in arrears on Series B preferred stock in the amount of
$341,155, on Series D
preferred stock in the amount of $283,045 and on Series E preferred stock in the
amount of $148,150.
Year 2000 - Until just a few years ago, most computer programs were written to define
an applicable year
by using two digits for the year instead of four. The effect on a computer program that
was written in such a
way is to define a year that is entered with the two digits "00" as 1900 rather than 2000.
When the Year
2000 arrives, any computer programs that are written in this manner will either have to
be modified to
accept a date in the 21st century or the programs will have to be replaced. This issue
not only effects the
Company's internal automated information systems but also has an effect on the
software products the
Company develops, supports and markets to its customers. The Company has
evaluated the computer
programs that it utilizes internally for its information systems and has determined that
substantially all of its
systems are currently Year 2000 compliant. The Company's asystTM product line is
Year 2000 compliant.
The Company's customers that are utilizing its LegacyTM, and QuestTM product lines
are being offered a
Year 2000 compliant version of certain packages within these product lines or are being
encouraged to
migrate to the Company's products that are Year 2000 compliant. Based on currently
available information,
the Company does not anticipate that the costs to address the issues related to the Year
2000 will have a
material adverse impact on the Company's financial condition, results of operations or
liquidity.
Forward-Looking Statements This report contains forward-looking statements, other
than historical facts,
which reflect the view of Company's management with respect to future events. Such
forward-looking
statements are based on assumptions made by and information currently available to the
Company's
management. Although management believes that the expectations reflected in such
forward-looking
statements are reasonable, it can give no assurance that such expectations will prove to
have been correct.
Important factors that could cause actual results to differ materially from such
expectations include, without
limitation, the ability of the Company i) to generate levels of revenue and adequate cash
flows from its
operations to support and maintain its current cost structure and ii) to develop and
deliver products that are
competitive, accepted by its markets and are not rendered obsolete by changing
technology. The
forward-looking statements contained herein reflect the current views of the Company's
management with
respect to future events and are subject to these factors and other risks, uncertainties
and assumptions
relating to the operations, results of operations and financial position of the Company.
The Company
assumes no obligation to update the forward-looking statements or to update the
reasons actual results
could differ from those contemplated by such forward-looking statements.
Fri Aug 14 2:40pm
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