Company Quick10K Filing
Pismo Coast Village
Closing Price ($) Shares Out (MM) Market Cap ($MM)
$0.00 0 $-0
10-Q 2020-02-14 Quarter: 2019-12-31
10-K 2019-12-23 Annual: 2019-09-30
10-Q 2019-08-14 Quarter: 2019-06-30
10-Q 2019-05-14 Quarter: 2019-03-31
10-Q 2019-02-14 Quarter: 2018-12-31
10-K 2018-12-19 Annual: 2018-09-30
10-Q 2018-08-13 Quarter: 2018-06-30
10-Q 2018-05-15 Quarter: 2018-03-31
10-Q 2018-02-14 Quarter: 2017-12-31
10-K 2017-12-20 Annual: 2017-09-30
10-Q 2017-08-11 Quarter: 2017-06-30
10-Q 2017-05-12 Quarter: 2017-03-31
10-Q 2017-02-14 Quarter: 2016-12-31
10-K 2016-12-19 Annual: 2016-09-30
10-Q 2016-08-12 Quarter: 2016-06-30
10-Q 2016-05-13 Quarter: 2016-03-31
10-Q 2016-02-16 Quarter: 2015-12-31
10-K 2015-12-17 Annual: 2015-09-30
10-Q 2015-08-14 Quarter: 2015-06-30
10-Q 2015-05-14 Quarter: 2015-03-31
10-Q 2015-02-13 Quarter: 2014-12-31
10-K 2014-12-09 Annual: 2014-09-30
10-Q 2014-08-14 Quarter: 2014-06-30
10-Q 2014-05-15 Quarter: 2014-03-31
10-Q 2014-02-14 Quarter: 2013-12-31
10-K 2013-12-18 Annual: 2013-09-30
10-Q 2013-08-14 Quarter: 2013-06-30
10-Q 2013-05-14 Quarter: 2013-03-31
10-Q 2013-02-13 Quarter: 2012-12-31
10-K 2012-12-20 Annual: 2012-09-30
10-Q 2012-08-15 Quarter: 2012-06-30
10-Q 2012-05-14 Quarter: 2012-03-31
10-Q 2012-02-14 Quarter: 2011-12-31
10-K 2011-12-21 Annual: 2011-09-30
10-Q 2011-08-12 Quarter: 2011-06-30
10-Q 2011-05-16 Quarter: 2011-03-31
10-Q 2011-02-15 Quarter: 2010-12-31
10-K 2010-12-06 Annual: 2010-09-30
10-Q 2010-08-13 Quarter: 2010-06-30
10-Q 2010-05-17 Quarter: 2010-03-31
10-Q 2010-02-12 Quarter: 2009-12-31
8-K 2020-01-21 Shareholder Vote
8-K 2019-01-22 Officers, Shareholder Vote
8-K 2018-09-18 Enter Agreement
8-K 2018-01-22 Officers, Shareholder Vote
PCV 2019-12-31
Part I - Financial Information
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II -- Other Information
Item 1. Legal Proceedings
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Submission of Matters To A Vote of Security Holders
Item 5. Other Information
Item 6. Exhibits
Note 1 - Nature of Business
Note 2 - Summary of Significant Accounting Policies
Note 3 - Property and Equipment
Note 4 - Line of Credit
Note 5 - Capital Lease Obligations
Note 6 - Common Stock
Note 7 - Income Taxes
Note 8 - Operating Leases
Note 9 - Employee Retirement Plans
Note 10 - Subsequent Events
EX-31.1 exhibit31_1.htm
EX-31.2 exhibit31_2.htm
EX-31.3 exhibit31_3.htm
EX-32.1 exhibit32_1.htm
EX-32.2 exhibit32_2.htm
EX-32.3 exhibit32_3.htm

Pismo Coast Village Earnings 2019-12-31

PCV 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

Comparables ($MM TTM)
Ticker M Cap Assets Liab Rev G Profit Net Inc EBITDA EV G Margin EV/EBITDA ROA
NODC 0 0 0 -0 -12 -12 -0 -16% 0.0 -7,460%
GAIF 28 0 0 0 0 0 -0 -0.0 0%
REBL 2 5 0 -2 -14 -14 -0 -936% 0.0 -897%
CCAA 0 4 0 0 -0 -0 -0 0.0 -72,087%
CAVF 115 5 0 0 -12 -12 -0 0.0 -10%
MLIC 428,103 397,431 36,289 0 4,036 4,434 -7,715 0% -1.7 1%
SCGY 0 2 0 0 -0 -0 -0 0.2 -220%
TLX 14 15 14 3 -5 -3 -0 23% 0.0 -33%
SLV 0 0 -288 -288 -0 0.0 28,776,460,600%
GRCR 5 6 0 0 -12 -12 -1 47% 0.1 -256%

10-Q 1 form10q.htm FORM 10-Q Form 10Q

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

[X]

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended December 31, 2019

 

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 0-8463

 

PISMO COAST VILLAGE, INC.

(Exact name of registrant as specified in its charter)

   California                                                                                                                                                                                          95-2990441

(State or other jurisdiction of                                                                                                                                                     (IRS Employer ID No.)

incorporation or organization)

165 South Dolliver Street, Pismo Beach, CA                                                                                                                                                  93449

(Address of Principal Executive Offices)                                                                                                                                                     (Zip Code)

(805) 773-5649

Registrant’s telephone number, including area code

 

(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 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 [  ]

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web Site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Subsection 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    YES [X]            NO [  ]

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.

 

[  ] Large accelerated filer

 

[  ] Accelerated filer

[X] Non-accelerated filer

 

[X] Smaller reporting company

[  ] Emerging growth company

 

1



If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).       YES [  ]            NO [X]

 

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

 

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13, or 15 (d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.            YES [  ]            NO [  ]

 

APPLICABLE ONLY TO CORPORATE ISSUERS:

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.            1,775

 

PART I – FINANCIAL INFORMATION

 

ITEM 1.       FINANCIAL STATEMENTS

 

The following financial statements and related information are included in this Form 10-Q, Quarterly Report.

 

1.   Accountant’s Review Report

 

2.   Balance Sheets

 

3.   Statements of Income and Retained Earnings

 

4.   Statements of Cash Flows

 

5.   Notes to Financial Statements (Unaudited)

 

The financial information included in Part I of this Form 10-Q has been reviewed by Brown Armstrong Accountancy Corporation, the Company's Certified Public Accountants, and all adjustments and disclosures proposed by said firm have been reflected in the data presented. The information furnished reflects all adjustments, which, in the opinion of management, are necessary to a fair statement of the results for the interim periods.

 

ITEM 2.       MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

STATEMENT ON FORWARD-LOOKING INFORMATION

Certain information included herein contains statements that may be considered forward-looking statements, such as statements relating to anticipated expenses, capital spending and financing sources. Such forward-looking information involves important risks and uncertainties that could significantly affect anticipated results in the future and, accordingly, such results may differ from those expressed in any forward-looking statements made herein. These risks and uncertainties include, but are not limited to, those relating to competitive industry conditions, California tourism and weather conditions, dependence on existing management, leverage and debt service, the regulation of the recreational vehicle industry, domestic or global economic conditions and changes in federal or state tax laws or the administration of such laws.

 

2



OVERVIEW

The Company continues to promote and depend upon recreational vehicle camping as the primary source of revenue. The rental of campsites to the general public provides income to cover expenses, complete capital improvements, and allow shareholders up to forty-five free nights camping annually. Additional revenues come from RV storage and spotting, RV service and repair, on-site convenience store, and other ancillary activities such as laundromat, arcade, and bike rental.

 

The RVing public actively seeks accommodations on the Central Coast despite volatile fuel prices and personal financial uncertainties. RVing offers an affordable outdoor recreational experience, and the Company provides quality facilities and services in a highly popular location. Based on advanced reservation deposits, occupancy projections are positive compared to this time last year. Revenues from ancillary operations, such as the General Store, RV Service, arcade, laundromat, and bike rental, are up 4.7% year-to-date, and management feels this trend will improve as business moves into the primary camping season. Industry projections anticipate positive business trends and reasonable fuel prices as the summer season approaches.

 

RV storage and towing continue to be a primary source of revenue for the Company. RV storage provides numerous benefits to the customer including: no stress of towing, no need to own a tow vehicle, use of RV by multiple family members, and convenience. Revenues for RV storage and towing are up 3.9% compared to the previous year due to increased RV storage occupancy and favorable weather.

 

Ongoing investment in resort improvements has assured resort guests and shareholders a top quality, up-to-date facility. This quality and pride of ownership was evident when the National Association of RV Parks and Campgrounds Park of the Year was awarded to the resort for 2007-08. In addition, in a national “My Favorite Campground” contest sponsored by Woodall’s, Pismo Coast Village was voted as one of the top ten favorite campgrounds for 2011.

 

The Company’s commitment to quality, value, and enjoyment is underscored by the business’s success due to word of mouth and referrals from guests. In addition, investment for online marketing, ads in the leading national directory, and trade magazine advertising formulates most of the business-marketing plan.

 

RESULTS OF OPERATIONS

The Company develops its income from two sources: (a) Resort Operations, consisting of revenues generated from RV site rentals, from RV storage space operations, and from lease revenues from laundry, restaurant, and arcade operations by third party lessees; and (b) Retail Operations, consisting of revenues from General Store operations and from RV parts and service operations.

 

Income from Resort Operations for the three-month period ended December 31, 2019, decreased $12,961, or 0.8%, from the same period in 2018. This decrease is primarily due to a $25,820, or 2.4%, decrease in year-to-date site revenue, partially offset by a $16,659, or 3.9%, increase in RV storage and towing activity. Vending revenue, which includes income from the arcade, restaurant, and laundromat, decreased $3,497, or 12.6%.

 

Seasonal fluctuations within this industry are expected, and management projects that income for the fourth quarter will be approximately 40% of its annual revenue. This approximation is based on historical information.

 

3



Income from retail operations increased by $16,793 for the three-month period ended December 31, 2019, 6.9% above the same period in 2018. The General Store income decreased $715, or 0.6%, while the RV Service and Repair income increased revenue by $17,507, or 14.9%, compared to the previous year.

 

The Company anticipates slight to moderate increases in both income from resort operations and in retail operations as the fiscal year progresses.

 

Operating expenses for the three-month period ending December 31, 2019, increased $33,904, or 2.5%, above the same period ended December 31, 2018. This reflects an increase in labor and labor related expenses, legal, credit card expense, electricity, repairs and maintenance. Other operating costs remain consistent with the prior year and are considered well managed to create an effective operation.

 

Cost of goods sold expenses for the three-month period ended December 31, 2019, are 47.1%, compared to 49.9% for the same period in 2018, which is within the guidelines established by management for the individual category sales of RV supplies and General Store merchandise.

 

Interest expense for the three-month period ended December 31, 2019, was $6,139, compared to $2,560 for the same period ending 2018.

 

Income before provisions for income taxes for the three-month period ended December 31, 2019 decreased by $33,879 below the same period in 2018. This decrease in income before provision for income taxes is a result of increased operating expenses, cost of goods sold, and interest expense.

 

Due to the nature of business and economic cycles and trends, rates may be adjusted accordingly, if deemed necessary. Although the supply-demand balance generally remains favorable, future-operating results could be adversely impacted by weak demand. This condition could limit the Company's ability to pass through inflationary increases in operating costs as higher rates.

 

Increases in transportation and fuel costs or sustained recessionary periods could also unfavorably impact future results. However, the Company believes that its financial strength and market presence will enable it to remain extremely competitive. It is anticipated the published rates will continue to market site usage at its highest value and not negatively impact the Company's ability to capture an optimum market share.

 

LIQUIDITY

The Company's current cash position, as of December 31, 2019, is $4,986,308, which is 16.8% more than the same position in 2018. The cash balance decreased $89,716 from the fiscal year ended September 30, 2019, due to capital expenditures. The Company has maintained cash balances in anticipation for large capital expenditures necessary to upgrade the resort. The Company has also maintained a line of credit of $500,000 to insure funds will be available, if required.

 

Accounts payable and accrued liabilities decreased $2,799 below the same period last year and increased $77,874 since the 2019 fiscal year end, which reflects a timing of capital projects and accrued vacation. All undisputed payables have been paid in full according to the Company's policy.

 

Working capital increased to $3,092,649 at the end of the first quarter of fiscal year 2020, compared with $3,075,762 the end of fiscal year 2019.

 

4



CAPITAL RESOURCES AND PLANNED EXPENDITURES

The Company plans capital expenditures of approximately $650,000 in fiscal year 2020 to further enhance the resort facilities and services. These projects include completing the construction of a new RV Service Repair facility; purchase a new trailer tow truck, resort surveillance upgrade, a street sweeper, and a lift for the RV Service and Repair facility. Funding for these projects is expected to be from normal operating cash flows and, if necessary, supplemented with outside financing. These capital expenditures are expected to increase the resort’s value to its shareholders and the general public.

 

Capital expenditures are consistent with prior years and operations and are expected to provide adequate resources to support the amounts committed to complete the authorized capital projects during the fiscal year. Second quarter site occupancy and storage fill are expected to be consistent with that of the past year. Capital projects are designed to enhance the marketability of the camping sites and enhance support facilities.

 

DISCLOSURE CONCERNING WEBSITE ACCESS TO COMPANY REPORTS

The Company makes available on its website, www.pismocoastvillage.com, access to its annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the Securities and Exchange Commission (SEC).

 

The public may read and copy any materials filed with the Securities and Exchange Commission, on official business days during the hours of 10:00 a.m. to 3:00 p.m., at the SEC's Public Reference Room located at 100 F Street, N. E., Washington, D.C. 20549. Information on the operation of the Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site (http://www.sec.gov) that contains reports, proxy statements, and other information that the Company files electronically with the SEC.

 

ITEM 3.       QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not Applicable.

 

ITEM 4. CONTROLS AND PROCEDURES

 

DISCLOSURE CONTROLS AND PROCEDURES

As required by Rule 13a-15 under the Securities Exchange Act of 1934 (the “1934 Act”), as of December 31, 2019, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer/General Manager (our principal executive officer) and our Chief Financial Officer (our principal financial officer). Based upon and as of the date of that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as described in Item 8A(T) included with our Annual Report on Form 10-K for the year ended September 30, 2019.

 

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the 1934 Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the 1934 Act is accumulated and communicated to our management, including our principal executive officer and our principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

 

5



 

INTERNAL CONTROL OVER FINANCIAL REPORTING

There have not been any changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) promulgated by the SEC under the 1934 Act) during the three-months ended December 31, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

PART II -- OTHER INFORMATION

 

ITEM 1.       LEGAL PROCEEDINGS

No pending legal proceedings against the Company other than routine litigation incidental to the business.

 

ITEM 2.       UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Not Applicable

 

ITEM 3.       DEFAULTS UPON SENIOR SECURITIES

Not Applicable

 

ITEM 4.       SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The annual meeting for the shareholders of Pismo Coast Village, Inc. was held Saturday, January 18, 2020, at 9:00 a.m. at the South County Regional Center, 800 West Branch Street, Arroyo Grande, California 93420. At that meeting, the following Directors were elected to serve until the annual meeting in January 2021 or until successors are elected and have qualified. Following each elected Director's name is the total number of votes cast for that Director:

 

Bessom, David

599

Blank, Sam

582

Buchaklian, Harry

592

Enns, Rodney

598

Fischer, William

575

Hardesty, Wayne

578

Hearne, Dennis

580

Hughes, Terris

597

Johnson, Marcus

602

King, Karen

650

Nelson, Garry

579

Nunlist, Ronald

579

Pappi, Jr., George

583

Plumley, Dwight

744

Roberts, Jerry

636

Skaggs, Brian

587

Willems, Gary

605

Williams, Jack

610

 

Further, the following additional matters were voted upon at the meeting, and the number of affirmative votes and negative votes cast with respect to each such matters is set forth below:

 

Proposal to approve the selection of Brown Armstrong Accountancy Corporation to serve as independent certified public accountants for the Company for Fiscal Year 2019 - 2020: 

 

Affirmative Votes

605

Negative Votes

6

Abstentions

17

 

6



Proposal to approve a non-binding advisory vote to approve the compensation of the Company’s named executive officer:

 

Affirmative Votes

529

Negative Votes

38

Abstentions

68

 

ITEM 5.       OTHER INFORMATION

The annual meeting of the shareholders of Pismo Coast Village, Inc. was held Saturday, January 18, 2020, at 9:00 a.m. at the South County Regional Center, 800 West Branch Street, Arroyo Grande, California 93420. Following that meeting, the newly elected Board held a reorganizational meeting at which the following officers were elected to serve until the next Annual Shareholders’ Meeting:

 

President

Terris Hughes

Executive Vice President

Garry Nelson

V. P. – Finance/Chief Financial Officer

Wayne Hardesty

V. P. – Operations

Rodney Enns

V. P. – Secretary

George Pappi, Jr.

Assistant Corporate Secretary

Jay Jamison

 

ITEM 6.       EXHIBITS

 

Exhibit No.

 

Description of Exhibit

 

 

31.1

Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Terris Hughes, President and Chairman of the Board)

31.2

Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Jay Jamison, Chief Executive Officer and principal executive officer)

 

 

31.3

Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Wayne Hardesty, Chief Financial Officer, principal financial officer and principal accounting officer)

 

 

32.1

Certification Pursuant to 18 U. S. C. Subsection 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(Terris Hughes, President and Chairman of the Board)

 

 

32.2

Certification Pursuant to 18 U. S. C. Subsection 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(Jay Jamison, Chief Executive Officer and principal executive officer)

 

 

32.3

Certification Pursuant to 18 U. S. C. Subsection 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(Wayne Hardesty, Chief Financial Officer, principal financial officer and principal accounting officer)

 

7



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.

 

PISMO COAST VILLAGE, INC.

(Registrant)

Date:          February 10, 2020

 

Signature:   /s/ TERRIS HUGHES                                                                

Terris Hughes, President and Chairman of the Board

 

 

Date:          February 10, 2020

 

Signature:   /s/ WAYNE HARDESTY                                                           

Wayne Hardesty, V.P. - Finance/Chief Financial Officer

(principal financial officer and principal accounting officer)

 

 

Date:          February 10, 2020

 

Signature:   /s/ JAY JAMISON                                                                     

Jay Jamison, General Manager/Chief Executive Officer

(principal executive officer)

 

8


 

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Board of Directors

and Stockholders of Pismo Coast Village, Inc.

165 South Dolliver Street

Pismo Beach, California

Results of Review of Interim Financial Information

We have reviewed the balance sheets of Pismo Coast Village, Inc. (the Company) as of December 31, 2019 and 2018, and the related statements of operations, and statement of changes in stockholders’ equity for the three-month periods ended December 31, 2019 and 2018, and statements of cash flows for the three-month periods then ended, and the related notes (collectively referred to as the interim financial statements). Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the balance sheet of the Company as of September 30, 2019, and the related statements of income and comprehensive income, and cash flows for the year then; and in our report dated November 25, 2019, we expressed an unqualified opinion on those financial statements. In our opinion, the information set forth in the accompanying condensed balance sheet as of September 30, 2019, is fairly stated, in all material respects, in relation to the balance sheet from which it has been derived.

Basis for Review Results

These interim financial statements are the responsibility of the Company’s management. We conducted our review in accordance with the standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

 

BROWN ARMSTRONG ACCOUNTANCY CORPORATION

Bakersfield, California

Bakersfield, California

February 10, 2020

 

9



PISMO COAST VILLAGE, INC.
BALANCE SHEETS

DECEMBER 31, 2019 AND 2018 AND SEPTEMBER 30, 2018

 

December 31,

2019

 

 September 30,

2019

 

 

December 31,

2018

Assets

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

$

4,986,308

 

$

5,076,024

 

$

4,269,231

Accounts receivable

 

33,759

 

 

50,412

 

 

28,768

Inventories

 

203,591

 

 

191,246

 

 

196,482

Prepaid income taxes

 

-

 

 

4,900

 

 

-  

Prepaid expenses

 

131,070

 

 

26,107

 

 

144,211

Total current assets

 

5,354,728

 

 

5,348,689

 

 

4,638,692

 

 

 

 

 

 

 

 

 

Property and equipment

 

 

 

 

 

 

 

 

Net of accumulated depreciation and amortization

 

15,401,335

 

 

15,314,959

 

 

14,606,379

 

 

 

 

 

 

 

 

 

Investments

 

-

 

 

-

 

 

83,835

 

 

 

 

 

 

 

 

 

Total assets

$

20,756,063

 

$

20,663,648

 

$

19,328,906

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Equity

Current liabilities

Accounts payable and accrued liabilities

354,245

$

276,371

$

357,044

Accrued salaries and vacation

113,658

359,910

99,153

Rental deposits

1,716,141

1,592,692

1,629,495

Income taxes payable

33,600

-

65,700

Current portion of capital lease obligations

 

44,435

 

43,954

 

36,437

Total current liabilities

2,262,079

2,272,927

2,187,829

Long-term liabilities

Deferred taxes

437,700

444,800

505,600

Capital lease obligations, net of current portion

 

186,956

 

198,247

 

160,268

Total liabilities

 

2,886,735

 

2,915,974

 

2,853,697

Stockholders' equity

 Common stock - no par value, 1,800 shares issued
     1,775 shares outstanding

5,569,268

5,569,268

        5,569,268

Retained earnings

12,300,060

12,178,406

10,847,106

Accumulated other comprehensive income

 

-

 

-

 

  58,835

Total stockholders' equity

 

      17,869,328

 

17,747,674

 

16,475,209

Total liabilities and stockholders' equity

$

20,756,063

 $

20,663,648

$

19,328,906

The accompanying notes are an integral part of these financial statements.

 

10



 

PISMO COAST VILLAGE, INC.

STATEMENTS OF OPERATIONS

(UNAUDITED)

THREE MONTHS ENDED DECEMBER 31, 2019 AND 2018

Three Months

Ended December 31,

2019

2018

Income

Resort operations

$

1,555,852

$

1,568,813

Retail operations

 

261,300

 

244,507

Total income

 

1,817,152

 

1,813,320

Cost and expenses

Operating expenses

1,412,356

1,378,452

Cost of goods sold

123,011

121,897

Depreciation

 

103,098

 

105,009

Total costs and expenses

 

1,638,465

 

1,605,358

Income from operations

178,687

207,962

Other income (expense)

Interest/dividend income

506

1,531

Interest expense

 

(6,139)

 

(2,560)

Total other income (expense)

 

(5,633)

 

(1,029)

Income before provision for income tax

173,054

206,933

Provision for income tax

51,400

 

60,000

Net income

121,654

146,933

Other comprehensive income

Change in unrealized holding gains on
  available-for-sale securities,net of change in
  applicable deferred taxes of $8,200

 

   -

 

(19,169)

Total other comprehensive loss

 

-

 

  (19,169)

Total comprehensive income

$

121,654

$

127,764

Net income per share

68.54

 

82.78

 

 

 

 

 

 

Total comprehensive income per share

$

68.54

$

71.98

The accompanying notes are an integral part of these financial statements.

 

11



 

PISMO COAST VILLAGE, INC.
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

(UNAUDITED)
MARCH 31, JUNE 30, SEPTEMBER 30, AND DECEMBER 31, 2019

Common Stock

Retained
Earnings

Accumulated
Other

Comprehensive Income

Shares

Amount

Total

Balance - March 31, 2019

1,775

$

5,569,268

$

11,027,805

$

66,861

$

16,663,934

Net Income

          - 

          - 

671,230

671,230

Other comprehensive income

 

-

 

 

-

 

 

-

 

 

(66,861)

 

 

           (66,861)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - June 30, 2019

1,775

$

5,569,268

$

11,699,035

$

-

$

17,268,303

Net Income

-

-

479,371

-

479,371

Other comprehensive income

-

-

Balance - September 30, 2019

1,775

$

5,569,268

$

12,178,406

$

-

$

17,747,674

Net Income

-  

-  

121,654

-

121,654

Other comprehensive loss

-    

-    

            -

            -

Balance - December 31, 2019

1,775

$

5,569,268

$

12,300,060

$

 -

$

17,869,328

 

The accompanying notes are an integral part of these financial statements.

 

12



 

PISMO COAST VILLAGE, INC.
STATEMENTS OF CASH FLOWS (UNAUDITED)

THREE MONTHS ENDED DECEMBER 31, 2019 AND 2018

 

 

 

 

 

 

2019

2018

Cash flows from operating activities

 

 

 

 

 

 

Net income

 

$

121,654

 

 

$

146,933

Adjustments to reconcile net income to net   
   cash provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

$

103,098

 

 

 

$

105,009

 

 

Changes in operating assets and liabilities:

  

 

 

 

 

 

 

 

Accounts receivable

16,653

 

 

 

 

 

26,641

 

 

 

Inventories

(12,345)

 

 

 

 

 

(14,045)

 

 

 

Prepaid income taxes

4,900

 

 

 

 

 

 

 

 

 

Prepaid expenses

(104,963)

 

 

 

 

 

(128,788)

 

 

 

Accounts payable and accrued liabilities

        77,874

 

 

 

 

 

105,183

 

 

 

Accrued salaries and vacation

    (246,252)

 

 

 

 

 

   (238,953)

 

 

 

Rental deposits

123,449

 

 

 

 

 

130,411

 

 

 

Income taxes payable

33,600

 

 

 

 

 

57,400

 

 

 

Deferred taxes

 

(7,100)

 

 

 

 

 

(6,500)

 

 

 

Total adjustments

 

 

 

 

(11,086)

 

 

 

 

 

36,358

Net cash provided by operating activities

 

 

 

 

110,568

 

 

 

 

 

        183,291

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

 

 

Capital expenditures

 

 

(189,474)

 

 

 

 

 

   (104,299)

 

 

 

Net cash used in investing activities

 

 

 

 

 

      (189,474)

 

 

 

 

 

      (104,299)

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

 

 

 

 

Principal payments on capital lease obligations

 

      (10,810)

 

 

 

 

 

     (12,197)

 

 

 

Net cash used in financing activities

 

 

 

 

        (10,810)

 

 

 

 

 

        (12,197)

 

 

 

 

 

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents

 

 

 

        (89,716)

 

 

 

 

 

66,795

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents - beginning of period

 

 

 

 

5,076,024

 

 

 

 

 

    4,202,436

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents - end of period

 

 

$

4,986,308

 

 

 

 

$

4,269,231

 

 

 

 

 

 

 

 

 

 

 

 

 

Schedule of payments of interest and taxes

 

 

 

 

 

 

 

 

 

 

Cash paid for interest

 

 

$

6,139

 

 

 

 

$

2,560

 

The accompanying notes are an integral part of these financial statements.

 

13



PISMO COAST VILLAGE, INC.

NOTES TO FINANCIAL STATEMENTS

DECEMBER 31, 2019 AND 2018 AND SEPTEMBER 30, 2019

 

 

NOTE 1 – NATURE OF BUSINESS

 

Pismo Coast Village, Inc. (the Company) is a recreational vehicle camping resort.  Its business is seasonal in nature with the fourth quarter, the summer, being its busiest and most profitable.

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Revenue and Cost Recognition

The Company’s revenue is recognized on the accrual basis as earned based on the date of stay.  Expenditures are recorded on the accrual basis whereby expenses are recorded when incurred, rather than when paid.

 

Cash and Cash Equivalents

For purposes of the statements of cash flows, the Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents.  As of December 31, 2019, September 30, 2019 and December 31, 2018 the Company had $6,092, $6,088 and $6,075 of cash equivalents, respectively.

 

Allowance for Doubtful Accounts

It is the policy of management to review the outstanding accounts receivable at year-end, as well as historical bad debt write-offs, and establish an allowance for doubtful accounts for estimated uncollectible accounts.  Management did not believe an allowance for doubtful accounts was necessary as of December 31, 2019, September 30, 2019, or December 31, 2018.

 

Inventories

Inventories have been valued at the lower of cost or market on a first-in, first-out basis.  Inventories are comprised primarily of finished goods in the general store and parts in the RV shop.

 

Property and Equipment

All property and equipment are recorded at cost.  Depreciation of property and equipment is computed using the straight-line method based on the cost of the assets, less allowance for salvage value, where appropriate.  Depreciation rates are based upon the following estimated useful lives:

 

Building and park improvements

5 to 40 years

Furniture, fixtures, equipment and leasehold improvements

3 to 31.5 years

Transportation equipment

5 to 10 years

 

14



PISMO COAST VILLAGE, INC.

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2019 AND 2018 AND SEPTEMBER 30, 2019

PAGE 2

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

 

Investments

Investments in securities have been classified in the balance sheet, according to management’s intent, as securities available-for-sale under the provisions of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 320 Investments – Debt and Equity Securities.

 

Available-for-sale securities consist of investment securities not classified as trading securities nor as held-to-maturity securities.  Unrealized holding gains and losses, net of deferred taxes, on available-for-sale securities are reported as a net amount in a separate component of stockholders’ equity until realized.  Gains and losses on the sale of available-for-sale securities are determined using the specific identification method. 

 

Fair Value Measurements

The Company records its financial assets and liabilities at fair value in accordance with the Fair Value Measurements and Disclosures Topic of Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) (the Topic).  This Topic provides a framework for measuring fair value, clarifies the definition of fair value and expands disclosures regarding fair value measurements.  Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date.  The Topic also establishes a three-tier hierarchy, as follows, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

 

Level 1:  Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the Company has the ability to access.

 

Level 2:  Inputs to the valuation methodology include:

 

·         Quoted prices for similar assets and liabilities in active markets;

 

·         Quoted prices for identical or similar assets or liabilities in inactive markets;

 

·         Inputs other than quoted prices that are observable for the asset or liability;

 

·         Inputs that are derived principally from or corroborated by observable market data by correlation or other means.

 

If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.

 

15



PISMO COAST VILLAGE, INC.

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2019 AND 2018 AND SEPTEMBER 30, 2019

PAGE 3

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

 

Fair Value Measurements (continued)

Level 3:  Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

 

The following is a description of the valuation methodologies used for assets measured at fair value:

 

Investments:  Investments in common stock are recorded at fair value based upon quoted market prices using Level 1 inputs.

 

This hierarchy requires the Company to use observable market data, when available, and to minimize the use of unobservable inputs when determining fair value. 

 

At December 31, 2019, the following sets forth by level, within the fair value hierarchy, the Company’s assets at fair value:

Level 1

 

Level 2

 

Level 3

Investment in common stock

 

$

-

 

$

-

 

 

 

 

 

 

 

 

 

Total assets at fair value

$

-

 

$

-

 

$

-

 

At September 30, 2019, the following sets forth by level, within the fair value hierarchy, the Company’s assets at fair value:

 

Level 1

 

Level 2

 

Level 3

Investment in common stock

 

$

-

 

$

-

 

 

 

 

 

 

 

 

 

Total assets at fair value

$

-

 

$

-

 

$

-

 

At December 31, 2018, the following sets forth by level, within the fair value hierarchy, the Company’s assets at fair value:

 

Level 1

 

Level 2

 

Level 3

Investment in common stock

$

83,835

 

$

-

 

$

-

 

 

 

 

 

 

 

 

 

Total assets at fair value

$

83,835

 

$

-

 

$

-

 

16



PISMO COAST VILLAGE, INC.

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2019 AND 2018 AND SEPTEMBER 30, 2019

PAGE 4

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

 

Earnings per Share

The earnings per share are based on the 1,775 shares outstanding.  The financial statements report only basic earnings per share, as there are no potentially dilutive shares outstanding.

 

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Company to make estimates and assumptions that affect certain reported amounts and disclosures.  Accordingly, actual results could differ from those estimates.

 

Advertising

The Company follows the policy of charging the costs of non-direct response advertising as incurred.  Advertising expense was $4,384 and $24,334 for the three months ended December 31, 2019 and 2018, respectively.  Advertising expense was included in operating expenses on the statement of operations. 

 

Concentration of Credit Risk

At December 31, 2019, September 30, 2019, and December 31, 2018 the Company had cash deposits of $3,179,725, $3,239,568, and $2,405,870, respectively, in excess of the $250,000 federally insured limit with Pacific Premier Bank.  However, because Pacific Premier Bank is a member of the Certificate of Deposit Account Registry Service (CDARS), large deposits are divided into smaller amounts and placed with other FDIC insured banks which are also members of the CDARS network.  Then, those member banks issue CDs in amounts under $250,000, so that the entire deposit balance is eligible for FDIC insurance.

 

Reclassifications

Certain reclassifications have been made to prior year balances to conform to current year presentation.  These reclassifications had no effect on the Company’s results of operations or financial position.

 

Income Taxes

The Company uses the asset-liability method of computing deferred taxes in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Income Taxes topic.  ASC 740 requires, among other things, that if income is expected for the entire year, but there is a net loss to date, a tax benefit is recognized based on the annual effective tax rate. 

 

17



PISMO COAST VILLAGE, INC.

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2019 AND 2018 AND SEPTEMBER 30, 2019

PAGE 5

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

 

Income Taxes (continued)

FASB ASC 740 also requires, among other things, the recognition and measurement of uncertain tax positions based on a "more likely than not" (likelihood greater than 50%) approach.  As of December 31, 2019, management has considered its tax positions and believes that the Company did not maintain any uncertain tax positions under this approach and, accordingly, all tax positions have been fully recorded in the provision for income taxes.  It is the policy of the Company to consistently classify interest and penalties associated with income tax expense separately from the provision for income taxes, and accordingly no interest or penalties associated with income taxes have been included in this calculation, or separately in the Statement of Operations and Retained Earnings.  The Company does not expect any material changes through December 31, 2020.  Although the Company does not maintain any uncertain tax positions, tax returns remain subject to examination by the Internal Revenue Service for fiscal years ending on or after September 30, 2017 and by the California Franchise Tax Board for fiscal years ending on or after September 30, 2016.

 

NOTE 3 – PROPERTY AND EQUIPMENT

 

At December 31, 2019, September 30, 2019, and December 31, 2018, property and equipment included the following:

 

December 31,

2019

 

September 30,

2019

 

December 31,

2018

Land

$

10,394,746

$

10,394,746

$

10,394,746

Building and resort improvements

11,342,501

11,342,501

11,353,001

Furniture, fixtures, equipment and leasehold improvements

703,255

703,255

666,768

Transportation equipment

768,755

768,755

741,437

Construction in progress

 

1,510,569

 

1,321,095

 

397,466

24,719,826

24,530,352

23,553,418

Less accumulated depreciation and amortization

 

(9,318,491)

 

(9,215,393)

 

(8,947,039)

$

15,401,335

$

15,314,959

$

14,606,379

 

Total depreciation and amortization expense for the three months ended December 31, 2019 and 2018 was $103,098 and $105,009, respectively.

 

18



PISMO COAST VILLAGE, INC.

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2019 AND 2018 AND SEPTEMBER 30, 2019

PAGE 6

 

NOTE 3 – PROPERTY AND EQUIPMENT (continued)

 

At December 31, 2019, September 30, 2019, and December 31, 2018, the cost of assets under capital lease was $398,770, $398,770, and $317,401, respectively, and related accumulated amortization was $217,554, $201,335, and $152,714, respectively.  Amortization expense on assets under capital lease was $16,209 and $12,140 for the three months ended December 31, 2019 and 2018, respectively.

 

NOTE 4 – LINE OF CREDIT

 

The Company has a revolving line of credit with Pacific Premier Bank (formerly Heritage Oaks Bank) for $500,000, expiring April 1, 2020.  There currently is a Letter of Credit written in favor of the County of San Luis Obispo (the County), California for $416,062 to cover a bond requirement relating to public improvements as part of the Company’s construction of a new RV service facility.  If the Company fails to complete the required public improvements, monies will be drawn from the credit line to satisfy the County.  A balance of $83,938 is available if the Company requires additional funding from the line of credit.  The Company expects the RV service facility project to be completed and bond satisfied by March 31, 2020.

 

NOTE 5 – CAPITAL LEASE OBLIGATIONS

 

At December 31, 2019, September 30, 2019, and December 31, 2018, capital lease obligations consisted of the following:

 

19



PISMO COAST VILLAGE, INC.

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2019 AND 2018 AND SEPTEMBER 30, 2019

PAGE 6

 

NOTE 5 – CAPITAL LEASE OBLIGATIONS (continued)

 

 

December 31,

2019

 

September 30,

2019

 

December 31,

2018

A 2013 Hino truck leased from Donahue Transportation Services Corp, payable in monthly installments of $1,046, including interest at 4.751% per annum, through April 2019.

$

4,144

A 2016 Hino truck leased from Donahue Transportation Services Corp, payable in monthly installments of $1,116, including interest at 4.532% per annum, through January 2023.

                 38,470 

41,360

49,837

A 2018 Hino truck leased from Donahue Transportation Services Corp, payable in monthly installments of $1,116, including interest at 4.644% per annum, through September 2024.

56,986

59,652

67,467

A 2019 Hino truck leased from Donahue Transportation Services Corp, payable in monthly installments of $1,116, including interest at 4.181% per annum, through May 2025.

64,812

67,465

75,257

A 2019 Hino truck leased from Donahue Transportation Services Corp, payable in monthly installments of $1,116, including interest at 4.101% per annum, through December 2025.

 

71,123

 

73,724

 

 

231,391

242,201

196,705

Less current portion

 

(44,435)

 

(43,954)

 

(36,437)

Total capital lease obligations

$

186,956

198,247

160,268

 

20



PISMO COAST VILLAGE, INC.

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2019 AND 2018 AND SEPTEMBER 30, 2019

PAGE 7

 

NOTE 5 – CAPITAL LEASE OBLIGATIONS (continued)

 

At December 31, 2019, future minimum payments on capital lease obligations were as follows:

 

For the Twelve Months Ending December 31,

2020

$

53,568

2021

53,568

2022

53,568

2023

41,292

2024

36,828

Thereafter

 

18,972

Present value of future minimum payments

257,796

Less amount representing interest

 

(26,405)

231,391

Less current portion of capital lease obligations

 

(44,435)

Total capital lease obligations, net of current portion

$

186,956

 

NOTE 6 – COMMON STOCK

 

Each share of stock is intended to provide the shareholder with free use of the resort for a maximum of 45 days per year.  If the Company is unable to generate sufficient funds from the public, the Company may be required to charge shareholders for services.

 

A shareholder is entitled to a pro rata share of any dividends as well as a pro rata share of the assets of the Company in the event of its liquidation or sale.  The shares are personal property and do not constitute an interest in real property.  The ownership of a share does not entitle the owner to any interest in any particular site or camping period.

 

NOTE 7 – INCOME TAXES

 

The provision for income taxes for the three months ended December 31, 2019 and 2018 is as follows:

Three Months Ended December 31,

2019

2018

Income tax expense

$

51,400

$

60,000

 

The Company uses the asset-liability method of computing deferred taxes in accordance with FASB ASC Topic 740.  The difference between the effective tax rate and the statutory tax rates is due primarily to the effects of state taxes net of the federal tax benefit and nondeductible variable costs of shareholder usage.

 

21


 

PISMO COAST VILLAGE, INC.

NOTES TO FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2019 AND 2018 AND SEPTEMBER 30, 2019

PAGE 8

 

NOTE 7 – INCOME TAXES (continued)

 

As of December 31, 2019, September 30, 2019, and December 31, 2018, the Company’s deferred tax liability was $437,700, $444,800, and $505,600, respectively.  Deferred income taxes arise from temporary differences between the tax basis of assets and liabilities and their reported amounts in the financial statements, which will result in taxable or deductible amounts in the future.  The majority of the balance is due to timing differences of depreciation expense, caused by the use of accelerated depreciation methods for tax calculations. 

 

NOTE 8 – OPERATING LEASES

 

The Company leases a lot which is located in Oceano and is leased at $3,302 per month.  The lease has converted to a month-to-month lease. As of the period ending December 31, 2019, the County is working on the lot. As a result, this lease payment is not being made at this time and will be resumed once the County completes their work.

 

The company has a five-year lease obligation for a copier.  Rental expense under this operating lease is $384 per month.  Future minimum lease payments under this obligation are as follows:

 

For the Twelve Months Ending December 31,

2020

$

4,608

2021

4,608

2022

 

768

$

9,984

 

Rent expense under these agreements was $1,242 and $11,149 for the three months ended December 31, 2019 and 2018, respectively.

 

NOTE 9 – EMPLOYEE RETIREMENT PLANS

 

The Company is the sponsor of a 401(k) profit sharing pension plan, which covers substantially all full-time employees.  Employer contributions are discretionary and are determined on an annual basis.  The Company's matching portion of the 401(k) safe harbor plan was $23,140 and $24,087 for the three months ended December 31, 2019 and 2018, respectively.

 

NOTE 10 – SUBSEQUENT EVENTS

 

Events subsequent to December 31, 2019 have been evaluated through February 10, 2020, which is the date the financial statements were available to be issued.  Management did not identify any subsequent events that required disclosure.

 

22