UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2006
o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from ____________ to____________
Commission File No. 0-30955
KENTEX PETROLEUM, INC.
(Exact name of small business issuer as specified in its charter)
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Nevada |
87-0645378 |
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(State or Other Jurisdiction of |
(I.R.S. Employer I.D. No.) |
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incorporation or organization) |
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4685 S. Highland Drive, Suite #202
Salt Lake City, Utah 84117
(Address of Principal Executive Offices)
(801) 278-9424
(Issuer’s Telephone Number)
N/A
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act 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 is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes x No o
1
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Not applicable.
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the Issuer’s classes of common equity, as of the latest practicable date: August 1, 2006 - 2,358,197 shares of common stock.
Transitional Small Business Disclosure Format (Check one): Yes o No x
FINANCIAL STATEMENTS
June 30, 2006
C O N T E N T S
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
KENTEX PETROLEUM, INC.
(A Development Stage Company)
June 30, 2006 and December 31, 2005
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6/30/2006 |
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12/31/2005 |
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[Unaudited] |
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[Audited] |
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ASSETS |
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Assets |
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— |
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— |
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Total Assets |
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— |
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— |
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LIABILITIES AND STOCKHOLDERS' DEFICIT |
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Current Liabilities: |
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Accounts Payable |
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$ |
— |
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$ |
15 |
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Loans from stockholders |
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35,600 |
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30,796 |
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Total Current Liabilities |
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35,600 |
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30,811 |
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Total Liabilities |
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35,600 |
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30,811 |
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Stockholders' Deficit: |
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Common Stock 100,000,000 shares authorized having a |
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par value of $.001 per share; 2,358,197 shares issued |
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and outstanding |
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2,358 |
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2,358 |
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Additional Paid-in Capital |
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2,073,802 |
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2,073,802 |
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Accumulated Deficit |
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(2,041,500 |
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(2,041,500 |
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Deficit accumulated during development stage |
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(70,260 |
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(65,471 |
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Total Stockholders' Deficit |
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(35,600 |
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(30,811 |
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Total Liabilities and Stockholders' Deficit |
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$ |
— |
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$ |
— |
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The accompanying notes are an integral part of these financial statements.
3
KENTEX PETROLEUM, INC.
(A Development Stage Company)
For the Three and Six Month Periods Ended June 30, 2006 and 2005 and
for the Period from Reactivation (May 8, 1999) through June 30, 2006
(Unaudited)
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From the |
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Beginning of |
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Reactivation on |
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For the Three Months Ended |
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For the Six Months Ended |
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May 8, 1999 |
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June 30, |
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June 30, |
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through |
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2006 |
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2005 |
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2006 |
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2005 |
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June 30, 2006 |
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Revenues |
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$ |
— |
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$ |
— |
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$ |
— |
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$ |
— |
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$ |
— |
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General and Administrative |
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680 |
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2,235 |
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4,789 |
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9,608 |
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95,260 |
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Operating Income (Loss) |
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(680 |
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(2,235 |
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(4,789 |
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(9,608 |
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(95,260 |
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Other Income |
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— |
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25,000 |
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— |
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25,000 |
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25,000 |
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Net (Loss) Before Income Taxes |
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(680 |
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22,765 |
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(4,789 |
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15,392 |
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(70,260 |
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Current Year Provision for Income Taxes |
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— |
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— |
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— |
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Net Income (Loss) |
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$ |
(680 |
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$ |
22,765 |
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$ |
(4,789 |
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$ |
15,392 |
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$ |
(70,260 |
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Loss Per Common Share |
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$ |
(0.01 |
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$ |
0.01 |
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$ |
(0.01 |
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$ |
0.00 |
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$ |
(0.03 |
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Weighted Average Shares Outstanding |
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2,358,197 |
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2,357,997 |
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2,358,197 |
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2,357,997 |
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2,218,645 |
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The accompanying notes are an integral part of these financial statements.
4
KENTEX PETROLEUM, INC.
(A Development Stage Company)
For the Six Month Periods Ended June 30, 2006 and 2005 and
for the Period from Reactivation (May 8, 1999) through June 30, 2006
(Unaudited)
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From the |
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Beginning of |
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Reactivation on |
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For the Six Months Ended |
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May 8, 1999 |
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June 30, |
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through |
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2006 |
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2005 |
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June 30, 2006 |
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Cash Flows Used For Operating Activities |
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Net Income (Loss) |
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(4,789 |
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15,392 |
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(70,260 |
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Adjustments to reconcile net loss to net cash |
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provided by operating activities: |
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Forgiveness of Debt |
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(25,000 |
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Increase/(Decrease) in accounts payable |
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(15 |
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(23,637 |
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25,000 |
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Increase/(Decrease) in Shareholder Loan |
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4,804 |
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8,245 |
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35,600 |
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Shares issued for services |
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— |
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— |
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34,660 |
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Net Cash (used in) Operating Activities |
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— |
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— |
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— |
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Net Increase/(Decrease) In Cash |
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— |
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— |
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— |
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Beginning Cash |
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— |
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— |
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— |
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Ending Cash |
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$ |
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$ |
— |
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$ |
— |
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Supplemental Disclosure of Cash Flow Information |
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Cash paid during the year for interest |
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$ |
— |
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$ |
— |
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$ |
— |
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Cash paid during the year for income taxes |
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$ |
— |
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$ |
— |
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$ |
— |
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The accompanying notes are an integral part of these financial statements.
5
KENTEX PETROLEUM, INC.
(A Development Stage Company)
NOTES TO UNAUDITED FINANCIAL STATEMENTS
June 30, 2006
NOTE 1 BASIS OF PRESENTATION
The accompanying financial statements have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. The interim financial statements reflect all adjustments, consisting of normal recurring adjustments, which, in the opinion of management, are necessary to present a fair statement of the results for the period.
Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10KSB for the year ended December 31, 2005. The results of operation for the period ended June 30, 2006 are not necessarily indicative of the operating results for the full years.
NOTE 2 LIQUIDITY/GOING CONCERN
The Company does not have significant assets, nor has it established operations and has accumulated losses since inception. These factors raise substantial doubt about the Company’s ability to continue as a going concern. It is the intent of the Company to seek a merger with an existing, well-capitalized operating company. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
NOTE 3 RELATED PARTY TRANSACTIONS
The Company has recorded a related party liability of $35,600 as of June 30, 2006. The unsecured loan bears no interest and is due on demand. For the six months ended June 30, 2006, a shareholder paid $4,804 on behalf of the Company.
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Item 2. Management’s Discussion and Analysis or Plan of Operation.
Plan of Operation
Our Company’s plan of operation for the next 12 months is to:(i) consider guidelines of industries in which our Company may have an interest; (ii) adopt a business plan regarding engaging in business in any selected industry; and (iii) to commence such operations through funding and/or the acquisition of a “going concern” engaged in any industry selected
Our Company’s only foreseeable cash requirements during the next 12 months will relate to maintaining our Company in good standing in the State of Nevada, as well as legal and accounting fees. Management does not anticipate that our Company will have to raise additional funds during the next 12 months.
As of the filing of this report we have not identified any operations nor are we in discussions with any potential operations.
Results of Operations
Three Months Ended June 30, 2006 Compared to Three Months Ended June 30, 2005
The Company has had no operations during the quarterly period ended June 30, 2006, nor do we have operations as of the date of this filing. In the quarterly period ended June 30, 2006, we had sales of $0, compared to the quarterly period ended June 30, 2005, with sales of $0. General and administrative expenses were $680 for the June 30, 2006 period compared to $2,235 for the June 30, 2005 period. General and administrative expenses for the three months ended June 30, 2006 were comprised mainly of accounting fees. We had net loss of $680 for the June 30, 2006 period compared to a net income of $22,765, resulting from forgiveness of debt, for the June 30, 2005 period.
Six Months Ended June 30, 2006 Compared to Six Months Ended June 30, 2005
The Company has had no operations during the six month period ended June 30, 2006, nor do we have operations as of the date of this filing. General and administrative expenses were $4,789 for the June 30, 2006 period compared to $9,608 for the June 30, 2005 period. General and administrative expenses for the six months ended June 30, 2006 were comprised mainly of accounting and filing fees. We had net loss of $4,789 for the June 30, 2006 period compared to a net income of $15,392, resulting from forgiveness of debt, for the June 30, 2005 period.
Liquidity and Capital Resources
Our total assets as of June 30, 2006, were $0, and we have no assets as of the date of this filing. We do depend on a shareholder being able to loan us money to fund our attempt to get and maintain our Company current in its filings and if this shareholder is not able to loan us the money our ability to continue in our attempt to get and maintain our Company current would be substantially reduced.
Forward-Looking Statements
The foregoing discussion contains forward-looking statements that discuss, among other things, future expectations and projections regarding future developments, operations and financial conditions. All forward-looking statements are based on management’s existing beliefs about present and future events outside of management’s control and on assumptions that may prove to be incorrect. If any underlying assumptions prove incorrect, Kentex Petroleum, Inc.’s actual results may vary materially from those anticipated, estimated, projected or intended.
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Item 3. Controls and Procedures.
As of the end of the period covered by this Quarterly Report, we carried out an evaluation, under the supervision and with the participation of our President and Secretary, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our President and Secretary concluded that information required to be disclosed is recorded, processed, summarized and reported within the specified periods and is accumulated and communicated to management, including our President and Secretary, to allow for timely decisions regarding required disclosure of material information required to be included in our periodic Securities and Exchange Commission reports. Our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives and our President and Secretary have concluded that our disclosure controls and procedures are effective to a reasonable assurance level of achieving such objectives. However, it should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote. In addition, we reviewed our internal controls over financial reporting, and there have been no changes in our internal controls or in other factors in the last fiscal quarter that has materially affected our internal controls over financial reporting.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None; not applicable.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
None; not applicable.
Item 3. Defaults Upon Senior Securities.
None; not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
None; not applicable.
Item 5. Other Information.
None; not applicable.
Item 6.Exhibits.
(a) Exhibits
31.1 302 Certification of Sarah Jenson
31.2 302 Certification of Lisa Howells
32 906 Certification
(b) Reports on Form 8-K
None; not applicable.
8
SIGNATURES
In accordance with the requirements of the Exchange Act, the Registrant has caused this Quarterly Report to be signed on its behalf by the undersigned, thereunto duly authorized.
KENTEX PETROLEUM, INC.
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Date: |
08/01/06 |
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By: |
/s/Sarah E. Jenson |
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Sarah E. Jenson, President and Director |
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Date: |
08/01/06 |
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By: |
/s/Lisa Howells |
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Lisa Howells, Secretary, Treasurer and Director |
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