UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 2003
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to .
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Commission file number 0-19000
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JLM COUTURE, INC.
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(Exact name of small business issuer as specified in its charter)
Delaware 13-3337553
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
225 West 37th Street, New York, New York 10018
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(Address of principal executive offices)
(212) 921-7058
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(Issuer's telephone number)
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(Former name, former address and former fiscal year, if changed
since last report)
The number of shares outstanding of the issuer's common stock,
par value $.0002 per share, as of June 19, 2003 was 1,903,360.
Transitional Small Business Disclosure Format (check one):
Yes [ ] No [X]
Page 1 of 20
The Exhibit Index is located on page 15.
JLM COUTURE, INC. AND SUBSIDIARIES
INDEX
Page
PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements.
Condensed consolidated Balance Sheets at April 30,
2003 (unaudited) and October 31, 2002 3-4
Condensed consolidated Statements of Income for
the Three and Six Months ended April 30,
2003 and 2002 (unaudited) 5
Condensed consolidated Statements of Cash
Flows for the Six Months ended April 30, 2003
and 2002 (unaudited) 6-7
Notes to Condensed consolidated Financial
Statements 8-11
Item 2. Management's Discussion and Analysis
or Plan of Operation. 11-12
PART II. OTHER INFORMATION:
Item 6. Exhibits and Reports on Form 8-K. 15
Signature 16
Certifications 17-20
PART I. FINANCIAL INFORMATION
JLM COUTURE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
April 30, October 31,
2003 2002
------------ -----------
(Unaudited)
Current assets:
Cash and cash equivalents $ 229,322 $ 958,810
Accounts receivable, net of allowances
for doubtful accounts and trade
discounts - $501,000 at April 30,
2003 and $451,000 at October 31, 2002 5,134,117 3,596,205
Inventories 3,642,311 3,747,357
Prepaid expenses and other current
assets 378,754 531,712
--------- ---------
Total current assets 9,384,504 8,834,084
Equipment and leasehold improvements
net of accumulated depreciation and
amortization of $456,638 at April 30, 2003
and $412,053 at October 31, 2002 570,501 460,264
Goodwill 211,272 211,272
Samples, net of accumulated amortization
of $192,435 at April 30, 2003 and
$132,493 at October 31, 2002 261,579 261,037
Other assets 94,415 49,540
---------- ---------
$10,522,271 $9,816,197
========== =========
See accompanying notes to condensed consolidated financial statements.
JLM COUTURE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' EQUITY
April 30, October 31,
2003 2002
------------ -----------
(Unaudited)
Current liabilities
Accounts payable $ 1,644,489 $1,014,241
Accrued expenses and
other current liabilities 566,896 786,099
Deferred income taxes - 73,000
Income taxes payable 55,089 157,289
---------- ---------
Total current liabilities 2,266,474 2,030,629
---------- ---------
Deferred income taxes 664,000 664,000
Total liabilities 2,930,474 2,694,629
--------- ---------
Shareholders' equity
Preferred stock - $.0001 par value,
authorized 1,000,000 shares; issued
and outstanding - none
Common stock - $.0002 par value,
authorized 10,000,000 shares;
issued 2,330,530 at April 30, 2003
and 2,330,530 at October 31, 2002;
Outstanding 1,903,360 at April 30,
2003 and 1,964,360 at October 31, 2002 465 465
Additional paid-in capital 3,653,642 3,653,642
Retained earnings 5,665,718 5,072,228
--------- ---------
9,319,825 8,726,335
Less: Deferred compensation (291,875) (335,000)
Notes receivable and accrued
interest (317,390) (365,265)
Treasury stock at cost:
427,170 shares at April 30,
2003 and 366,170 at October
31, 2002 (1,118,763) (904,502)
---------- ---------
Total shareholders' equity 7,591,797 7,121,568
----------- ---------
$10,522,271 $9,816,197
=========== ==========
See accompanying notes to condensed consolidated financial statements.
JLM COUTURE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE AND SIX MONTHS
ENDED APRIL 30, 2003 AND 2002
(Unaudited)
Three Months Ended Six Months Ended
April 30, April 30,
2003 2002 2003 2002
----------- ---------- ---------- -----------
Net sales $7,834,684 $7,608,472 $13,316,517 $12,108,748
Cost of goods sold 4,713,779 4,808,220 7,954,475 7,493,040
--------- --------- ---------- ----------
Gross profit 3,120,905 2,800,252 5,362,042 4,615,708
Selling, general and
administrative ex-
penses 2,434,051 2,132,581 4,327,550 3,656,891
--------- --------- --------- ---------
Operating income 686,854 667,671 1,034,492 958,817
Interest Income
(expense), net 1,131 (6,712) 3,998 (10,014)
--------- --------- --------- --------
Income before provision
for income taxes 687,985 660,959 1,038,490 948,803
Provision for income
taxes 295,000 280,000 445,000 400,000
--------- --------- --------- ---------
Net income $ 392,985 $ 380,959 $ 593,490 $ 548,803
========= ========= ========= =========
Net income per weighted
average number of common
shares
Basic $ 0.21 $ 0.19 $ 0.31 $ 0.27
========= ========= ========= =========
Diluted $ 0.19 $ 0.19 $ 0.29 $ 0.27
========= ========= ========= =========
Weighted average number
of common shares
Basic 1,908,999 2,027,333 1,920,708 2,063,359
========= ========= ========= =========
Diluted 2,060,727 2,035,560 2,069,912 2,070,741
========= ========= ========= =========
See accompanying notes to condensed consolidated financial statements.
JLM COUTURE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED
APRIL 30, 2003 and 2002
2003 2002
----------- ----------
Cash Flows from Operating Activities
Net income $ 593,490 $ 548,803
Adjustments to reconcile net income
to net cash (used in) provided by
operating activities:
Depreciation and goodwill amortization 44,585 47,206
Amortization of deferred compensation 43,125 50,626
Provision for doubtful accounts
and trade discounts 50,000 125,000
Changes in operating assets and liabilities
(Increase) in accounts receivable (1,587,912) (1,703,215)
Decrease (increase) in inventories 105,046 (261,786)
Decrease in prepaid expenses
and other current assets 152,958 106,359
(Increase) decrease in samples (542) 43,069
(Increase) in other assets (44,875) -
Increase in accounts payable 630,248 916,599
(Decrease) in accrued expenses and
other current liabilities (219,203) (10,045)
(Decrease) increase in taxes payable (175,200) 256,000
(Decrease) in long term liabilities - (8,239)
--------- ---------
Net cash (used in) provided by
Operating Activities (408,280) 110,377
--------- ---------
Cash Flows From Investing Activities
Purchase of property and equipment (154,822) (168,930)
Net payments of notes receivable 47,875 -
----------- ----------
Net cash used in Investing Activities (106,947) (168,930)
---------- ---------
Cash Flows from Financing Activities
Net proceeds from short term borrowing - 200,000
Purchase of treasury stock (214,261) (167,266)
---------- ---------
Net cash (used in) provided by Financing
Activities (214,261) 32,734
---------- ---------
Net (decrease) in cash (729,488) (25,819)
Cash, beginning of period 958,810 204,647
---------- ---------
Cash, end of period $ 229,322 $ 178,828
========== =========
See accompanying notes to condensed consolidated financial statements.
JLM COUTURE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED
APRIL 30, 2003 and 2002
(Unaudited)
Supplemental Disclosures of Cash Flow Information;
2003 2002
-------- --------
Cash paid during the period for:
Interest $ 9,360 $ 27,257
======== ========
Income taxes $520,000 $140,000
======== ========
See accompanying notes to condensed consolidated financial
statements.
JLM COUTURE, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1. Basis of Presentation
The condensed consolidated balance sheet as of April 30, 2003,
the condensed consolidated statements of income for the three and
six month periods ended April 30, 2003 and 2002 and the condensed
consolidated statements of cash flows for the six month periods
ended April 30, 2003 and 2002 have been prepared by the Company,
without audit. In the opinion of management, all adjustments
necessary to present fairly the financial position, results of
operations and cash flows, as of April 30, 2003 and for all periods
presented have been made. The results of operations are not
necessarily indicative of the results to be expected for the full
year.
Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally
accepted accounting principles have been omitted. It is suggested
that these financial statements be read in conjunction with the
financial statements and notes thereto included in the Company's
Form 10-KSB for its fiscal year ended October 31, 2002, which was
filed with the Securities and Exchange Commission.
The Company has elected to apply Accounting Principles Board
("APB") Opinion No. 25, Accounting for Stock Issued to Employees,
and related interpretations in accounting for its stock options
issued to employees (intrinsic value) and has adopted the
disclosure-only provisions of Statement of Financial Accounting
Standards ("SFAS") No. 123, Accounting for Stock-Based
Compensation. Had the Company elected to recognize compensation
cost based on the fair value of the options granted at the grant
date as prescribed by SFAS No. 123, the Company's net income and
income per common share would have been as follows:
Six months ended April 30, 2003 2002
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Net income - as reported $593,490 $548,803
Add: Stock based employee compensation
expense included in reported net income,
net of related tax effects 125,132 -
Deduct: Total stock-based employee
compensation expense determined
under fair value based method for
all awards, net of related tax effects 62,063 59,483
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JLM COUTURE, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Six months ended April 30, 2003 2002
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Net income pro forma $656,559 $489,320
================================================================
Basic income per share as reported $ 0.31 $ 0.27
================================================================
Basic income per share pro forma $ 0.34 $ 0.24
================================================================
Diluted income per share as reported $ 0.29 $ 0.27
================================================================
Diluted income per share pro forma $ 0.32 $ 0.24
================================================================
Three months ended April 30, 2003 2002
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Net income - as reported $392,985 $380,959
Add: Stock based employee compensation
expense included in reported net income,
net of related tax effects 125,132 -
Deduct: Total stock-based employee
compensation expense determined
under fair value based method for
all awards, net of related tax effects 20,167 -
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Net income pro forma $497,950 $380,959
================================================================
Basic income per share as reported $ 0.21 $ 0.19
================================================================
Basic income per share pro forma $ 0.26 $ 0.19
================================================================
Diluted income per share as reported $ 0.19 $ 0.19
================================================================
Diluted income per share pro forma $ 0.24 $ 0.19
================================================================
Note 2. Inventories
Inventories are stated at the lower of cost (first in, first
out) or market and include material, labor and overhead.
Inventories consisted of the following:
April 30, 2003 October 31, 2002
-------------- ----------------
Raw materials $2,493,539 $2,782,515
Work-in-process 483,301 354,114
Finished Goods 665,471 610,728
--------- ---------
$3,642,311 $3,747,357
========= =========
Raw materials are shown net of $260,000 obsolescence reserve at
April 30, 2003 and October 31, 2002.
JLM COUTURE, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 3. Goodwill
Effective November 1, 2002, the Company adopted Statement of
Financial Accounting Standards ("SFAS") No. 142, Goodwill and Other
Intangible Assets. SFAS No. 142 requires that an intangible asset
with a definite life be amortized over its useful life and that
goodwill and intangible assets with indefinite lives are not to be
amortized but are to be evaluated for impairment.
The Company concluded, as of April 30, 2003, that there was no
impairment to goodwill, and, pursuant to SFAS 142, goodwill is no
longer being amortized.
The following pro-forma information reconciles net income
reported for the three month and six month periods ended April 30,
2003 and 2002 to adjusted net income reflecting the adoption of
SFAS No. 142.
Three Months Ended Six Months Ended
April 30, April 30,
2003 2002 2003 2002
------- ------- ------- -------
Reported net income $392,985 $380,959 $593,490 $548,803
Addback: Goodwill
amortization - 3,521 - 7,042
Adjusted net income $392,985 $384,480 $593,490 $555,845
Basic income per share:
Reported net income $.21 $.19 $.31 $.27
Addback: Goodwill
amortization - - - -
Adjusted net income $.21 $.19 $.31 $.27
Diluted income per share:
Reported net income $.19 $.19 $.29 $.27
Addback: Goodwill
and amortization - - - -
Adjusted net income $.19 $.19 $.29 $.27
JLM COUTURE, INC. AND SUBSIDIARIES
Note 4. Revolving Line of Credit
The Company had an available line of credit of up to $500,000
with a financial institution. Borrowings are collateralized by the
Company's cash, accounts receivable, securities, deposits and
general intangibles. At April 30, 2003 and October 31, 2002 the
Company had no outstanding balances under the revolving line of
credit.
Note 5. Treasury Stock
During the six month period ended April 30, 2003 the Company
purchased 61,000 shares of Common Stock at a total cost of
$214,261. Treasury stock is reflected on the balance sheet as a
reduction of shareholder equity.
Additionally, during the six month period ended April 30,
2003, the Company, in conjunction with its stock repurchase
program, repurchased 206,000 stock options from employees for
$208,554. These costs were reflected as a charge to income in the
current period.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Critical Accounting Policies
----------------------------
The preparation of our condensed consolidated financial
statements in conformity with accounting principles generally
accepted in the United States of America requires us to make
estimates and judgments that affect the reported amounts of assets
and liabilities, net sales and expenses, and the related
disclosures. We base our estimates on historical experience, our
knowledge of economic and market factors and various other
assumptions that we believe to be reasonable under the
circumstances. Actual results may differ from these estimates under
different assumptions or conditions. We believe the following
critical accounting policies are affected by significant estimates,
assumptions and judgments used in the preparation of our condensed
consolidated financial statements.
JLM COUTURE, INC. AND SUBSIDIARIES
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
(Continued)
Allowances for Doubtful Accounts
--------------------------------
We maintain an allowance for doubtful accounts for losses that
we estimate will arise from our customers inability to make
required payments. We make our estimates of the uncollectability of
our accounts receivable by analyzing historical bad debts, specific
customer creditworthiness and current economic trends. At April
30, 2003 the allowance for doubtful accounts was $501,000 and at
October 31, 2002 it was $451,000.
Inventory Valuation
-------------------
We regularly assess the valuation of our inventories and write
down those inventories which are obsolete or in excess of our
forecasted usage to their estimated realizable value. Our estimates
of realizable value are based upon our analyses and assumptions
including, but not limited to, forecasted sales levels by product,
expected product lifecycle, product development plans and future
demand requirements. If market conditions are less favorable than
our forecasts or actual demand from our customers is lower than our
estimates, we may be required to record additional inventory write-
downs. If demand is higher than expected, we may sell our
inventories that had previously been written down. At April 30,
2003 and October 31, 2002 we maintained an obsolescence reserve of
$260,000.
Impairment of Goodwill
----------------------
In determining the recoverability of goodwill, assumptions
must be made regarding estimated future cash flows and other
factors to determine the fair value of the asset. If these
estimates or their related assumptions change in the future, the
Company may be required to record charges not previously recorded.
Effective November 1, 2002, the Company adopted Statement of
Financial Accounting Standards No. 142, "Goodwill and Other
Intangible Assets". Under the provisions of SFAS No. 142, the cost
of certain intangibles will no longer be subject to amortization
but was reviewed for potential impairment during the first six
months of Fiscal 2003 and on an annual basis thereafter. The
Company concluded, as of April 30, 2003, that there was no
impairment to goodwill, and, pursuant to SFAS 142, goodwill is no
longer being amortized.
Results of Operations
---------------------
Six months ended April 30, 2003 as compared to six months
ended April 30, 2002 and three months ended April 30, 2003 as
compared to three months ended April 30, 2002.
For the first six months of the Company's fiscal year ending
October 31,2003 ("Fiscal 2003"), revenues increased to $13,316,517
from $12,108,748, an increase of 10% over the same period a year
ago. This increase was due to increased market penetration of the
Company's products. Gross profit as a percentage of sales increased
to 40.3% from 38.1% as a larger percent of sales was from higher
margin products. Net income was $593,490, an increase of 8% from
net income of $548,803 in the first six months of Fiscal 2002. The
increase in net income, due to the increase in sales, was tempered
by a pre-tax expense of $208,554 for the repurchase of stock
options from employees. Per share earnings for the current six
months was $0.31 per basic share and $0.29 per diluted share as
compared to $0.27 a basic and diluted share a year ago. Selling,
general and administrative expenses as a percentage of sales
increased to 32.5% of sales as compared to 30.2% in fiscal 2002
largely due to the expense relating to the payment made to cancel
certain stock options.
For the quarter ended April 30, 2003, revenues increased to
$7,834,684 from $7,608,472, an increase of 3% over the same period
a year ago. Gross profit as a percentage of sales increased to
39.8% from 36.8% as a larger percent of sales was from higher
margin products. Net income was $392,985, an increase of 3% from
net income of $380,959 in the second quarter of Fiscal 2002. The
increase in net income, due to the increase in sales and gross
margin, was tempered by a pre-tax expense of $208,554 for the
repurchase of stock options from employees. Per share earnings
for the current quarter was $0.21 per basic share and $0.19 per
diluted share as compared to $ 0.19 a basic and diluted share
a year ago. Selling, general and administrative expenses as a
percentage of sales increased to 31.1% of sales as compared to
28% in Fiscal 2002 largely due to the expense relating to the
payment made to cancel certain stock options.
Liquidity and Capital Resources
------------------------------
The Company's working capital increased to $7,118,030 at April
30, 2003 from $6,803,455 at October 31, 2002. The Company's current
ratio decreased to 4.1 to 1 at April 30, 2003 from 4.4 to 1 at
October 31,2002.
During the six months ended April 30, 2003, the Company used
$408,280 in operations as compared to being provided $110,377 of
cash in the year earlier as the Company was more prompt with
payments to vendors in the current period. The Company also made
$520,000 in tax payments in the current period as compared to
$140,000 last year. The Company used $106,947 in investing activities
in the current year compared to $168,930 a year earlier. The Company
used $214,261 in financing activities during the six months ended April
30, 2003 as compared being provided $32,734 a year earlier. Last
year the Company borrowed funds during the six months ended April
30, 2002 as compared to this year.
On December 22, 1998, the Company issued an executive of the
Company 200,000 shares of Common Stock at a price of $2.25 per
share, which was the fair value on the issuance date. The
executive executed a ten-year promissory note due to the Company in
the amount of $450,000, with $45,000 principal and accrued interest
payments due annually on December 22, until repaid. The promissory
note bears interest at 5% per annum. The outstanding principal and
interest balance at April 30, 2003 and October 31, 2002 was
$271,500 and $319,375 respectively. The annual principal payment
of $45,000 due on December 22, 2002 was paid.
Safe Harbor Statement
---------------------
Statements which are not historical facts, including
statements about the Company's confidence and strategies and its
expectations about new and existing products, technologies and
opportunities, market and industry segment growth, demand and
acceptance of new and existing products are forward looking
statements that involve risks and uncertainties. These include,
but are not limited to, product demand and market acceptance risks;
the impact of competitive products and pricing; the results of
financing efforts; the loss of any significant customers of any
business; the effect of the Company's accounting policies; the
effects of economic conditions and trade, legal, social, and
economic risks, such as import, licensing, and trade restrictions;
the results of the Company's business plan and the impact on the
Company of its relationship with its lenders.
Item 3. Controls and Procedures.
Within the 90 days prior to the date of this report, the Company
carried out an evaluation, under the supervision and with the
participation of the Company's management, including the Company's
Chief Executive Officer and Chief Financial Officer, of the
effectiveness of the design and operation of the Company's
disclosure controls and procedures pursuant to Exchange Act Rule
13a-14. Based upon the evaluation, the Chief Executive Officer and
Chief Financial Officer concluded that the Company's disclosure
controls and procedures are effective. There were no significant
changes in the Company's internal controls or in other factors that
could significantly affect these controls subsequent to the date of
their evaluation.
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
3.1 Certificate of Incorporation of the Company as
amended dated December 30, 1994, incorporated by
reference to Exhibit 3.1 of the Company's annual
Report on Form 10-KSB filed for its fiscal year
ended October 31, 1995 ("1995 10-K").
3.2 The Company's By-Laws are incorporated by reference
to Exhibit 3.03 of Registration Statement No. 33-
10278 NY filed on Form S-18 ("Form S-18").
99.1 Certification pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002.
99.2 Certification pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002.
(b) Reports on Form 8-K.
None.
SIGNATURE
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.
JLM COUTURE, INC.,
Registrant
Dated: June 19, 2003 By:/s/Joseph L. Murphy
---------------------
Joseph L. Murphy
President (Authorized officer
and Principal Financial
Officer)
CERTIFICATION PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Joseph L. Murphy, certify that:
1. I have reviewed this quarterly report on Form 10-
QSB of JLM Couture, 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 have:
(a) designed such disclosure controls and
procedures to ensure that material information relating to the
registrant, including its condensed 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 filling 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.
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 functions):
(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.
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: June 19, 2003
/s/Joseph L. Murphy
Name: Joseph L. Murphy
Title: Chief Executive Officer
(Principal Executive Officer)
CERTIFICATION PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Jerrold Walkenfeld, certify that:
1. I have reviewed this quarterly report on Form 10-
QSB of JLM Couture, 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 have:
(a) designed such disclosure controls and
procedures to ensure that material information relating to the
registrant, including its condensed 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 filling 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.
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 functions):
(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.
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: June 19, 2003
/s/Jerrold Walkenfeld
-----------------------------
Name: Jerrold Walkenfeld
Title: Principal Accounting Officer
(Principal Financial Officer)