10-Q 1 ndsjune10q.txt SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q [X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended June 30, 2002 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission File Number: 2-99080 NATIONAL DIVERSIFIED SERVICES, INC. --------------------------------------------------------- (Exact name of Registrant as specified in its charter) Delaware 11-2820379 --------------------------- --------------------------- (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) c/o Lester Morse P.C. 111 Great Neck Road, Suite #420 Great Neck, New York 11021 ----------------------------------- ----------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (516) 487-1419 Not Applicable (Former name, former address and former fiscal year if changed since last report) 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. Yes x . No ___. --- 6,548,870 Common Shares, $.001 par value were issued and outstanding at August 15, 2002. NATIONAL DIVERSIFIED SERVICES, INC. INDEX

NATIONAL DIVERSIFIED SERVICES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

See accompanying notes to consolidated financial statements (unaudited). 3 NATIONAL DIVERSIFIED SERVICES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)

*Less than $.01 per share See accompanying notes to consolidated financial statements (unaudited). 4 NATIONAL DIVERSIFIED SERVICES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

See accompanying notes to consolidated financial statements (unaudited). 5 NATIONAL DIVERSIFIED SERVICES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2002 (UNAUDITED) NOTE 1 - BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements do not include all disclosures required to be included in a complete set of financial statements prepared in conformity with U.S. generally accepted accounting principles. In the opinion of management, all adjustments (consisting of normal recurring accruals) that are considered necessary for a fair presentation have been included. The results for the six month period ended June 30, 2002 are not necessarily indicative of the results that may be expected for the year ending December 31, 2002. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on Form 10-K filed on March 28, 2002 for the year ended December 31, 2001. NOTE 2 - NATURE OF BUSINESS The Company was organized under the laws of the State of Delaware on May 30, 1985 and was in the development stage until 1989. During November 1989, the Company began setting up operations to import to the United States products for sale principally to the hardware and construction markets. Two wholly-owned subsidiaries were formed to conduct these operations. The Company commenced operations during the first three months of 1990 and began billing its customers in April 1990. Billings to customers ended in June 1990 and the Company terminated its import business. Currently, the Company is exploring various business opportunities that may be available to it. NOTE 3 - PRINCIPLES OF CONSOLIDATION The consolidated financial statements include the accounts of the Company and its subsidiaries, which are all wholly-owned and totally inactive. All significant intercompany accounts and transactions have been eliminated in consolidation. 6 NATIONAL DIVERSIFIED SERVICES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS JUNE 30, 2002 (UNAUDITED) NOTE 4 - USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. NOTE 5 - FAIR VALUE OF FINANCIAL INSTRUMENTS The amounts at which current assets and current liabilities are presented in the balance sheet approximate their fair value due to their short-term nature. NOTE 6 - CASH EQUIVALENTS Cash equivalents represent short-term commercial paper with maturities of less than ninety days. 7 Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations During the three months and six months ended June 30, 2002, the Company had no revenues other than interest income since the Company terminated its import and sale business operations in 1990. The Company is presently exploring various business opportunities that may be available to it. No assurances can be given that the Company will be successful in completing a transaction to acquire an operating business. During the six months ended June 30, 2002, there were no material changes in the financial condition of the Company other than a net loss of $15,083 as compared to a net loss of $5,220 for the comparable period of the prior year. Due to the Company lacking any current business activities or operations, other than searching for a new business opportunity or merger candidate, there are no trends or uncertainties that have had or reasonably expect to have a material favorable or unfavorable impact on revenues or income (loss) from continuing operations. Further, there are no unusual or infrequent events or transactions or any significant economic changes that materially effected the amount of reported income (loss) from continuing operations. Liquidity and Capital Resources Financing of the Company's activities has been provided from the public sale of its securities for cash amounting to a net of approximately $600,000. At June 30, 2002, the Company's working capital amounted to $156,077 with cash assets of $228,590. Management believes that its cash assets are adequate to meet the Company's short term and long term liquidity and cash requirements until such time, if ever, as the Company completes a transaction to establish an operating business. The Company has been unable to find a suitable business opportunity or merger candidate over the last ten years, considering the limited cash resources available to the Company and that the Company's Common Stock has no active and established trading market. Nevertheless, Management is continuing to explore various business opportunities that may be available to it. As of the filing date of this Form 10-Q, there are no known trends or any known demands, commitments, events or uncertainties that will result in or that are reasonably likely to result in the Registrant's liquidity increasing or decreasing in any material way. Further, at the present time, the Company has no commitments for capital expenditures and does not anticipate same until it establishes a business or acquires an operating business, of which there can be no assurances given. 8 NATIONAL DIVERSIFIED SERVICES, INC. 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 - 11 Statement re: computation of per share earnings-See consolidated statement of operations 99.1 Certification of Executive Officers (b) No reports on Form 8-K were filed during the quarter ended June 30, 2002. 9 NATIONAL DIVERSIFIED SERVICES, INC. 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. NATIONAL DIVERSIFIED SERVICES, INC. (Registrant) Dated: August 16, 2002 /s/Morry Rubin Morry Rubin, President, Chief Executive, Financial and Accounting Officer 10 Certification Pursuant to 18 U.S.C.ss.1350 In connection with the filing with the United States Securities and Exchange Commission of National Diversified Services, Inc.'s (the "Company") Quarterly Report on Form 10-Q for the period ended June 30, 2002 (the "Report"), the undersigned, the Chief Executive Officer and the Chief Financial Officer of the Company, hereby certify that (i) in our capacities as officers of the Company, (ii) to each of our own respective actual knowledge, and (iii) solely for the purpose of compliance with 18 U.S.C.ss.1350, that: (1) the Report fully complies with the requirements of ss.13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. The above certification is given as of the date of the Report and is limited to the periods covered by the Report. IN WITNESS WHEREOF, the undersigned have executed this Certificate on August 16, 2002. By: /s/Morry F. Rubin Chief Executive Officer By: /s/ Morry F. Rubin Chief Financial Officer

NATIONAL DIVERSIFIED SERVICES INC 10-Q