UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 for the quarterly period ended June 30, 2003.
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from _________________ to _________________
Commission file number 0-4431
AUTO-GRAPHICS, INC.
(Exact name of small business issuer as specified in its charter)
California
(State or other jurisdiction of incorporation or organization)
95-2105641
(IRS Employer Identification No.)
3201 Temple Avenue, Pomona, CA 91768
(Address of principal executive offices)
(909) 595 - 7204
(Issuer's telephone number)
Total shares of Common Stock issued and outstanding as of
August 14, 2003 is 5,525,486.
AUTO-GRAPHICS, INC.
Form 10-QSB
June 30, 2003
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Unaudited Consolidated Balance Sheet................1
Unaudited Condensed Consolidated
Statements of Operations and
Comprehensive Income for the Six
Months Ended June 30, 2003 and 2002...............2
Unaudited Condensed Consolidated
Statements of Operations and
Comprehensive Income for the Three
Months Ended June 30, 2003 and 2002...............3
Unaudited Consolidated
Statements of Cash Flows for the Six
Months Ended June 30, 2003 and 2002. .............4
Notes to the Unaudited Consolidated
Financial Statements..............................5
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations........................................9
Item 3. Controls and Procedures............................15
PART II. OTHER INFORMATION..................................16
Signatures.........................................17
Certifications.....................................18
-1-
AUTO-GRAPHICS, INC.
Form 10-QSB
PART I -- FINANCIAL INFORMATION
Item 1. Financial Statements.
Unaudited Consolidated Balance Sheet
June 30, 2003
ASSETS
Current assets:
Cash $ 44,402
Accounts receivable, less allowance
for doubtful accounts of $25,000 213,102
Unbilled production costs 732
Other current assets 182,832
-----------
Total current assets 441,068
Software, net 3,041,360
Equipment, furniture
and leasehold improvements, net 752,451
Other assets 95,540
-----------
$ 4,330,419
LIABILITIES AND STOCKHOLDERS' EQUITY ===========
Current liabilities:
Accounts payable $ 104,063
Deferred income 892,071
Other accrued liabilities 178,572
Accrued payroll and
related liabilities 199,928
Note Payable (Note 2) 600,872
Current portion of
long-term debt (Note 2) 25,236
-----------
Total current liabilities 2,000,742
Long-term debt,
less current portion 22,485
Deferred taxes based on income 73,000
-----------
Total liabilities 2,096,227
Stockholders' equity:
Common stock,
12,000,000 shares authorized,
5,525,486 shares issued and
outstanding in 2003 4,274,594
Accumulated deficit ( 2,040,679)
Other comprehensive income/(loss) 277
-----------
Total stockholders' equity 2,234,192
-----------
$ 4,330,419
===========
See Notes to Unaudited Consolidated Financial Statements.
-2-
AUTO-GRAPHICS, INC.
Form 10-QSB
Unaudited Condensed Consolidated
Statements of Operations and Comprehensive Income
For the Six Months Ended June 30,
2003 2002
---------- ----------
Net sales (See Note 3) $2,993,156 $3,232,260
Costs and expenses:
Cost of sales 1,686,188 1,804,843
Selling, general & administrative 1,069,067 1,353,498
---------- ----------
Total costs and expenses 2,755,255 3,158,341
---------- ----------
Income from operations 237,901 73,919
Interest/other income/(expense) ( 32,930) ( 30,894)
---------- ----------
Income before taxes
and minority interests 204,971 43,025
Provision for taxes
based on income (See Note 4) 3,000 3,000
Minority Interests -- ( 14,164)
---------- ----------
Net income and total
comprehensive income $ 201,971 $ 54,189
========== ==========
Basic earnings per share $ .04 $ .01
Basic weighted average
shares outstanding 5,525,486 4,997,234
Diluted earnings per share $ .04 $ .01
Diluted weighted average
shares outstanding 5,673,819 5,070,567
See Notes to Unaudited Consolidated Financial Statements.
-3-
AUTO-GRAPHICS, INC.
Form 10-QSB
Unaudited Condensed Consolidated
Statements of Operations and Comprehensive Income
For the Three Months Ended June 30,
2003 2002
---------- ----------
Net sales (See Note 3) $1,475,111 $1,596,254
Costs and expenses:
Cost of sales 835,792 866,361
Selling, general & administrative 526,442 682,771
---------- ----------
Total costs and expenses 1,362,234 1,549,132
---------- ----------
Income from operations 112,877 47,122
Interest/other income/(expense) ( 12,236) ( 19,781)
---------- ----------
Income before taxes
and minority interests 100,641 27,341
Provision for taxes
based on income (See Note 4) -- 3,000
Minority Interests -- ( 2,605)
---------- ----------
Net income and total
comprehensive income $ 100,641 $ 26,946
========== ==========
Basic earnings per share $ .02 $ .01
Basic weighted average
shares outstanding 5,525,486 4,997,234
Diluted earnings per share $ .02 $ .01
Diluted weighted average
shares outstanding 5,822,153 5,143,900
See Notes to Unaudited Consolidated Financial Statements.
-4-
AUTO-GRAPHICS, INC.
Form 10-QSB
Unaudited Consolidated
Statements of Cash Flows
For the Six Months Ended June 30,
Increase (Decrease) in Cash
2003 2002
---------- ----------
Cash flows from operating activities:
Net income $ 201,971 $ 54,189
Adjustments to reconcile
net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 577,316 583,374
Minority Interests -- ( 14,163)
Changes in operating assets
and liabilities:
Accounts receivable 119,065 365,714
Unbilled production costs 2,666 ( 6,155)
Other current assets ( 7,685) ( 36,399)
Other assets ( 16,093) 8,672
Accounts payable ( 150,506) ( 116,231)
Deferred income ( 489,674) ( 457,216)
Other accrued liabilities ( 206,657) 41,846
Accrued payroll and
related liabilities ( (36,870) ( 191,697)
---------- ----------
Net cash provided by (used in)
operating activities ( 6,467) 231,934
Cash flows from investing activities:
Capital expenditures ( 273,717) ( 258,492)
Cash flows from financing activities:
Principal borrowings/(payments)
under notes, net 280,284 13,095
Exercise of Warrants 12,425 --
Receipts from notes receivable - stock -- 2,067
Net Cash provided by ---------- ----------
financing activities 292,709 15,162
---------- ----------
Net increase (decrease) in cash 12,525 ( 11,396)
Foreign currency effect on cash -- 13,946
Cash at beginning of period 31,877 122,029
---------- ----------
Cash at end of period $ 44,402 $ 124,579
========== ==========
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 39,618 $ 55,873
Income taxes 1,983 2,435
See Notes to Unaudited Consolidated Financial Statements.
-5-
AUTO-GRAPHICS, INC.
Form 10-QSB
Notes to
Unaudited Consolidated Financial Statements
June 30, 2003
NOTE 1. Basis of Presentation
The unaudited consolidated financial statements included herein
have been prepared by Registrant and include all normal and
recurring adjustments which are, in the opinion of management,
necessary for a fair presentation of the financial position at
June 30, 2003, the results of operations and the statement of cash
flows for the three months ended June 30, 2003 and 2002 pursuant to
the rules and regulations of the Securities and Exchange Commission.
The consolidated financial statements include the accounts of
Auto-Graphics, Inc. and its wholly-owned owned subsidiaries. All
material intercompany accounts and transactions have been eliminated.
The results of operations for the subject periods are not necessarily
indicative of the results for the entire year.
This Quarterly Report on Form 10-QSB is qualified in its entirety by
the information included in the Company's Annual Report to the SEC on
Form 10-K for the period ending December 31, 2003 including, without
limitation, the financial statements and notes therein.
NOTE 2. Notes Payable
The Company was in compliance with its financial loan covenants as of
June 30, 2003 under its bank credit agreement. The outstanding loan
balance of the line of credit was $601,000 ($474,000 available) out of a
total commitment of $1,075,000 at June 30, 2003. The interest rate on
the line of credit is the bank prime rate plus 4.5 percentage points (8.50%
at June 3, 2003). The Company's bank line of credit facility matures each
year in June (June 30, 2004) and is therefore reported as a current liability
in the Company's balance sheet for quarter ended June 30, 2003. The credit
line is secured by all of the assets of the Company and its subsidiaries. It
also requires that the Company maintain certain minimum financial covenant
ratios, restricts the payment of cash dividends, and limits the amount of
certain types of equity investments, the repurchase of Company stock and
loans to third parties and subsidiaries.
In February 2003, A-G Canada, Ltd. a wholly-owned Canadian subsidiary of the
Company, pledged a Guaranteed Income Certificate in the amount of $45,000 to
Toronto Dominion Bank as collateral for a four-year Letter of Credit in the
amount of $45,000.
-6-
AUTO-GRAPHICS, INC.
Form 10-QSB
Notes to
Unaudited Consolidated Financial Statements
June 30, 2003
Note 3. Operating Segments
Statement of Financial Accounting Standards No. 131, "Disclosures
about Segments of an Enterprise and Related Information" establishes
standards for reporting information about operating segments in interim and
annual financial statements.
The following table summarizes sales based on the location of the customers
and assets based on the location of the asset presented on the basis of
generally accepted accounting principles for the six months ended June
30, 2003, and 2002:
2003 2002
----------- -----------
Geographic areas
Net sales
United States $ 2,493,879 $ 2,784,022
Foreign - Canada/Other 499,277 448,238
Long-lived assets, net
United States 3,787,452 4,310,544
Foreign - Canada 6,359 34,746
Note 4. Income Taxes
Deferred tax assets and liabilities are recognized for the expected
future tax consequences of events that have been reported in the Company's
financial statements or tax returns. At December 31, 2002, the Company had
available net operating loss carryforwards for federal income tax purposes of
$3,151,000, $1,115,000 for state income tax purposes and $1,055,000 for
foreign income tax purposes. A valuation allowance reflects the unrecognized
U.S. and foreign tax loss carryforward. These net operating loss
carryforwards may be used to offset federal income taxes through 2022, state
income taxes through 2010 and foreign income taxes through 2007.
Note 5. Earnings Per Share
Statement of Financial Accounting Standards No. 128, "Earnings per Share"
requires the presentation of basic earnings per share and diluted earnings
per share. Basic and diluted earnings per share computations presented by
the Company conform to the standard and are based on the weighted average
number of shares of Common Stock outstanding during the year.
-7-
AUTO-GRAPHICS, INC.
Form 10-QSB
Notes to
Unaudited Consolidated Financial Statements
June 30, 2003
Note 5. Earnings Per Share(continued)
On May 3, 2002, July 17, 2002 and June 18, 2003, Company's Board of Directors
granted stock options for a total of 380,000 shares of the Company's
"restricted" Common Stock to directors and certain employees.
In February, 2003, the Company issued 621,252 warrants (at an exercise price
of $0.01 per warrant) to two directors to purchase 621,252 shares of the
Company's "restricted" common stock at an exercise price of $0.01 per share.
In May and June 2003, all of these warrants were exercised and the stock was
purchased and issued.
The following is a reconciliation of the numerators and denominators of the
basic and diluted earnings per share computations:
Net Income Shares Per Share
Six months ended June 30, 2003 ---------- --------- ----------
Basic earnings per share
Net income available to
common stockholders $ 201,970 5,525,486 $ 0.04
Effect of dilutive securities
Stock options 148,333
Diluted earnings per share ---------- --------- ----------
Net income available to
common stockholders $ 201,970 5,673,819 $ 0.04
Six months ended June 30, 2002
Basic earnings per share
Net income available to
common stockholders $ 54,189 4,997,234 $ 0.01
Effect of dilutive securities
Stock options 73,333
Diluted earnings per share ---------- --------- ----------
Net income available to
common stockholders $ 54,189 5,070,567 $ 0.01
-8-
AUTO-GRAPHICS, INC.
Form 10-QSB
Notes to
Unaudited Consolidated Financial Statements
June 30, 2003
Note 5. Earnings Per Share(continued)
Net Income Shares Per Share
Three months ended June 30, 2003 ---------- --------- ----------
Basic earnings per share
Net income available to
common stockholders $ 100,641 5,525,486 $ 0.02
Effect of dilutive securities
Stock options 296,667
Diluted earnings per share ---------- --------- ----------
Net income available to
common stockholders $ 100,641 5,822,153 $ 0.02
Three months ended June 30, 2002
Basic earnings per share
Net income available to
common stockholders $ 26,946 4,997,234 $ 0.01
Effect of dilutive securities
Stock options 146,666
Diluted earnings per share ---------- --------- ----------
Net income available to
common stockholders $ 26,946 5,143,900 $ 0.01
Note 6. Recently Issued Accounting Pronouncements
In May, 2003, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standard (SFAS) No. 150, Accounting for Certain
Financial Instruments with Characteristics of both Liabilities and Equity.
The Statement establishes standards for how an issuer classifies and measures
certain financial instruments with characteristics of both liabilities and
equity. The Company believes the adoption of this Statement will have no
material impact on its financial statements.
-9-
AUTO-GRAPHICS, INC.
Form 10-QSB
June 30, 2003
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
CRITICAL ACCOUNTING POLICIES
The Company maintains its accounting books and records in accordance with
accounting principles generally accepted in the United States of America. The
preparation of the financial statements of the Company in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect reported amounts of assets and
liabilities and sales and expenses during the reporting period. These
estimates are based on information available as of the date of the financial
statements. Actual results may materially differ from those estimated. The
Company's critical accounting policies include the following:
* Capitalized software development costs
* Amortization of software development costs
* Revenue Recognition
The Company accounts for internally developed software in accordance with
Statement of Financial Accounting Standard (SFAS) No. 86, "Accounting for the
Costs of Computer Software to Be Sold, Leased or Otherwise Marketed." After
technical feasibility has been established, the Company capitalizes the
average cost per billable hour of its software development process including
payroll and payroll benefits, training and recruiting costs. The Company
collects and records the software development hours invested in software
development projects. Annually, the Company evaluates these accumulated
costs for recoverability against estimated future revenues and determines
the amount, which will be capitalized. The Company generally capitalizes
approximately one-half of the annual software development costs and
expenses the remainder. To the extent that more development costs are
capitalized, the Company's current net income will improve, and, to the
extent that more software development costs are expensed instead of
capitalized, the Company's current net income will decline. Because of
the effect on earnings, the Company endeavors to capitalize a relatively
consistent amount year-to-year to minimize the fluctuation in earnings.
-10-
AUTO-GRAPHICS, INC.
Form 10-QSB
June 30, 2003
The Company amortizes its software development costs in accordance with the
estimated economic life of the software, which generally is seven years.
The Company's typical product lifecycle has been about 15 years, which was
true for its prior film/fiche product line, CD-ROM product line and current
Internet/Web product line, which has now been deployed for nine years and
is still growing. To the extent the average actual useful life varies
significantly from the estimated useful life, amortization expense may be
understated or overstated. Generally, amortization expense averages less
than 15% of the corresponding revenue stream.
Revenue recognition policies vary according to the nature of the revenue.
The Company's primary revenue stream is outsourced web hosting services
which are sold on a subscription basis. Services are billed in advance
on an annual or quarterly basis. Revenue is recognized monthly on a pro-
rata basis i.e., for a twelve month contract, one-twelfth of the revenue
is recognized each month as services are rendered. Revenues which have
been billed and collected in advance are booked as deferred income until
the services are provided and revenues earned. Certain insignificant
annual subscriptions for databases and software support typically are
recognized as revenue in the month they are billed. Certain cost of sales
and overhead costs for providing future software support services are accrued
as expense in accordance with SOP 97-2, "Software Revenue Recognition," as
amended by SOP 98-9. Certain contract job processing services are progress
billed and revenues recognized as the processing services are performed on
a monthly basis. Certain software and hardware sales are billed when the
product is shipped and title passes to the customer.
-11-
AUTO-GRAPHICS, INC.
Form 10-QSB
June 30, 2003
LIQUIDITY AND CAPITAL RESOURCES
The working capital deficit decreased by $678,000 to a negative $1,560,000
from $2,238,000 in 2002, primarily as a result of a repayment of $667,000 in
borrowing on the bank line of credit and other term debt. Working capital
is being adversely affected by the requirement to report the $601,000 bank
line of credit as a current liability under generally accepted accounting
principles since it matures on June 30, 2004 (see below). Net cash used in
operating activities was approximately $6,000 in 2003 down from net cash
provided by operating activities of $232,000 in 2002 due to reductions in
accounts receivable and accrued liabilities. The Company's primary ASP
product lines are sold on an annual subscription basis with fees for services
billed to the customer and paid annually or quarterly in advance. This cash
is received and booked to deferred income on the balance sheet to be applied
as the monthly sales revenues are earned and recognized on a pro-rata basis.
As the actual cash is received, it is used to pay down the line of credit.
A growing percentage of sales (currently over 65%) of the Company's sales
revenues are now being paid through customer advances without flowing through
accounts receivable. The average accounts receivable balance is therefore
lower (approximately one-third) what it would otherwise historically be and
there is a substantial deferred income balance in current liabilities
representing revenues to be earned from future services to customers who
have paid in advance.
At December 31, 2002, the Company's principal financial commitments, other
than its bank line of credit, involved the lease of corporate facilities in
Pomona, California and in Toronto, Canada. Total commitments over next five
years total approximately $1.0 million.
The Company's principal uses of cash for investing activities during 2003 and
2002 were directed primarily towards continuing development of the Company's
AGent(TM), VERSO(TM) and Impact/ONLINE(TM) software. The amounts invested
in software development were $250,000 in both 2003 and 2002. The remainder
of the investing activities were to acquire hardware and software used to
expand and enhance online services to the Company's current and prospective
Internet/Web customers. Total capital expenditures were up to $274,000 in 2003
compared to $259,000 in 2002.
-12-
AUTO-GRAPHICS, INC.
Form 10-QSB
June 30, 2003
Management believes that liquidity and capital resources should be adequate
to fund operations and expected reductions in bank debt in 2003. As of
June 30, 2003, the Company was in compliance with all of its loan covenants.
In May 2003, the Company's primary bank, Wells Fargo Bank, renewed and
extended the terms of its credit agreement for an additional 13 months to
June 30, 2004. The credit facility is a $1.075 million revolving line of
credit, which decreases by $175,000 on October 1, 2003 and by $500,000 on
January 1, 2004. The total borrowing was $601,000 at June 30, 2003 with
$474,000 in additional credit availability. Because the Company's bank line
of credit facility matures on June 30, 2004, it is reported as a current
liability in the Company's balance sheet for the quarter ended June 30, 2003.
The Company has no so-called special purpose entities, off-balance sheet or
derivative financing of any kind. All entities have been consolidated and all
material intercompany accounts and transactions have been eliminated.
Management remains concerned about the effect that the current economic
slump is having on state and local government budgets. Management expects
that the reduced availability of government funding for existing and new
library automation projects could reduce sales in 2003 by up to 10% from
2002 sales, although management expects the Company to be profitable for
the year 2003.
This Report includes forward-looking statements which reflect the
Company's current views with respect to future events and financial
performance. The Company undertakes no obligation to publicly update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
-13-
AUTO-GRAPHICS, INC.
Form 10-QSB
June 30, 2003
RESULTS OF OPERATIONS
First Six Months of 2003 as Compared to First Six Months of 2002
Net sales decreased $239,000 or 7% to $2,993,000 in 2003 from $3,232,000
in 2002 due primarily to declines in sales to publishing customers. The
Company is focusing on its core business of library services and not
soliciting new publishing customers.
Cost of sales decreased $119,000 or 7% to $1,686,000 in 2003 from
$1,805,000 in 2002 as a result of cost reductions in publishing production
payroll and office rent. Gross margins were unchanged at 44% of sales in
2003 and 2002.
Selling, general and administrative expenses decreased $284,000 or 21% to
$1,069,000 in 2003 from $1,353,000 in 2002 as a result of a substantial
decrease in legal expenses in 2003 compared to 2002. The substantial legal
fees in 2002 were due primarily to the lawsuits initiated by the Company's
former general counsel, Robert H. Bretz. The Company settled with Mr. Bretz
in January of 2003 ending the litigation.
Income from operations more than doubled to $238,000 in 2003 up from $74,000
in 2002 due to the above expense reductions.
Interest/other income/expense was essentially unchanged in 2003 from 2002.
Provision for taxes based on income in 2003 and 2002 reflects the minimum
state income taxes and the federal and state net operating loss carryforward
(See Note 4 of Notes to Unaudited Consolidated Financial Statements).
Minority interests of $14,000 reflects the minority owners' share of the
losses realized by the majority-owned Dataquad subsidiary in 2002. In
December 2002, both majority-owned subsidiaries, Dataquad and LibraryCard
were merged with Auto-Graphics, Inc.
Net income quadrupled to $202,000 in 2003 compared to $54,000 in 2002 due
to the above expense reductions.
Both basic and diluted earnings per share were $0.04 in 2003 compared to
$0.01 in 2002.
-14-
AUTO-GRAPHICS, INC.
Form 10-QSB
June 30, 2003
Second Quarter of 2003 as Compared to Second Quarter of 2002
Net sales decreased $121,000 or 8% to $1,475,000 in 2003 from $1,596,000
in 2002 due primarily to declines in sales to publishing customers. The
Company is focusing on its core business of library services and not
soliciting new publishing customers.
Cost of sales decreased $30,000 or 3% to $836,000 in 2003 from $866,000 in
2002 as a result of cost reductions in publishing production payroll and
office rent. Gross margins decreased from 46% in 2002 to 43% of sales in
2003.
Selling, general and administrative expenses decreased $156,000 or 23% to
$526,000 in 2003 from $683,000 in 2002 as a result of a substantial decrease
in legal expenses in 2003 compared to 2002. The substantial legal fees in
2002 were due primarily to the lawsuits initiated by the Company's former
general counsel, Robert H. Bretz. The Company settled with Mr. Bretz in
January of 2003 ending the litigation.
Income from operations more than doubled to $113,000 in 2003 up $66,000
from $47,000 in 2002.
Interest/other income/expense was an expense of $12,000 in 2003 down from an
expense of $20,000 in 2002 due to lower average borrowings and lower
interest rates.
Provision for taxes based on income in 2003 and 2002 reflects the federal
and state net operating loss carryforward and the minimum state income taxes
in 2002 (See Note 4 of Notes to Unaudited Consolidated Financial Statements).
Minority interests of $3,000 reflects the outside minority owners'
share of the losses realized by the majority-owned Dataquad subsidiary
in 2002. In December 2002, both majority-owned subsidiaries, Dataquad
and LibraryCard were merged with Auto-Graphics, Inc.
Net income quadrupled to $101,000 in 2003 compared to $27,000 in 2002 due
to the above expense reductions.
Both basic and diluted earnings per share were $0.02 in 2003 compared to
$0.01 in 2002.
-15-
AUTO-GRAPHICS, INC.
Form 10-QSB
June 30, 2003
ITEM 3. CONTROLS AND PROCEDURES
As of June 30, 2003, an evaluation was performed, under the supervision
and with the participation of the President and Chief Financial Officer, of
the effectiveness of the design and operation of our disclosure controls and
procedures. Based on that evaluation, the President and Chief Financial
Officer, concluded that our disclosure controls and procedures were effective
as of June 30, 2003. No significant changes in internal controls or in
other factors have occurred that could significantly affect controls
subsequent to June 30, 2003.
-16-
AUTO-GRAPHICS, INC.
Form 10-QSB
PART II - OTHER INFORMATION
Item 1. Legal Proceedings. None.
Item 2. Changes in Securities and Use of Proceeds. 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:
10.58 Third Amendment to Amended and Restated Credit Agreement
dated May 14, 2003.
10.59 Reducing Revolving Note dated May 14, 2003.
99.1 Certification by the Chief Executive Officer
99.2 Certification by the Chief Financial Officer
(b) None.
-17-
AUTO-GRAPHICS, INC.
Form 10-QSB
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.
AUTO-GRAPHICS, INC.
Date: August 14, 2003 /s/ Robert S. Cope
----------------------------
Robert S. Cope, President
Date: August 14, 2003 /s/ Daniel E. Luebben
----------------------------
Daniel E. Luebben,
Chief Financial Officer
-18-
AUTO-GRAPHICS, INC.
Form 10-QSB
CERTIFICATIONS
I, Robert S, Cope, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of
Auto-Graphics, Inc.;
2. Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light
of the circumstances under which such statements were made,
not misleading with respect to the period covered by this
quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly
present in all material respects the financial condition,
results of operations and cash flows of the registrant as of,
and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are
responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules
13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure
that material information relating to the registrant,
including its consolidated subsidiaries, is made known to
us by others within those entities, particularly during the
period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior
to the filing date of this quarterly report (the "Evaluation
Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures
based on our evaluation as of the Evaluation Date;
-19-
AUTO-GRAPHICS, INC.
Form 10-QSB
CERTIFICATIONS
5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the
registrant's ability to record, process, summarize and
report financial data and have identified for the
registrant's auditors any material weaknesses in internal
controls; and
b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the
registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated
in this quarterly report whether or not there were significant
changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date
of our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.
Date: August 14, 2003
/s/ Robert S. Cope
----------------------------
Robert S. Cope
Chairman of the Board
and President
-20-
AUTO-GRAPHICS, INC.
Form 10-QSB
CERTIFICATIONS
I, Daniel E. Luebben, certify that:
1. I have reviewed this quarterly report on Form 10-QSB of
Auto-Graphics, Inc.;
2. Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light
of the circumstances under which such statements were made,
not misleading with respect to the period covered by this
quarterly report;
3. Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly
present in all material respects the financial condition,
results of operations and cash flows of the registrant as of,
and for, the periods presented in this quarterly report;
4. The registrant's other certifying officers and I are
responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules
13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure
that material information relating to the registrant,
including its consolidated subsidiaries, is made known to
us by others within those entities, particularly during the
period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure
controls and procedures as of a date within 90 days prior
to the filing date of this quarterly report (the "Evaluation
Date"); and
c) presented in this quarterly report our conclusions about the
effectiveness of the disclosure controls and procedures
based on our evaluation as of the Evaluation Date;
-21-
AUTO-GRAPHICS, INC.
Form 10-QSB
CERTIFICATIONS
5. The registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the registrant's
auditors and the audit committee of registrant's board of
directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of
internal controls which could adversely affect the
registrant's ability to record, process, summarize and
report financial data and have identified for the
registrant's auditors any material weaknesses in internal
controls; and
b) any fraud, whether or not material, that involves management
or other employees who have a significant role in the
registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated
in this quarterly report whether or not there were significant
changes in internal controls or in other factors that could
significantly affect internal controls subsequent to the date
of our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.
Date: August 14, 2003
/s/ Daniel E. Luebben
----------------------------
Daniel E. Luebben
Chief Financial Officer
and Secretary