** **

**UNITEDSTATES****SECURITIESAND EXCHANGE COMMISSION****Washington,D.C. 20549**

 

**FORM10-QSB**

 

**(Mark One)**
| ý | **QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE  SECURITIES EXCHANGE ACT OF 1934** |
|--------|----------------------------------------------------------------------------------------|

**For thequarterly period ended September 30, 2001**
| **o** | **TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE  ACT** |
|-------|----------------------------------------------------------------------|

**For thetransition period from _________________ to _________________**

**Commissionfile number: 0-30185**

**GaselTransportation Lines, Inc.**

(Exact name of small business issuer as specified inits charter)

 

| **Ohio**                                                                            |   | **31-1239328**                    |
|-------------------------------------------------------------------------------------|--------|-----------------------------------|
| (State or other jurisdiction of incorporation or  organization)                     |   | (IRS Employer Identification No.) |
|                                                                                |   |                              |
| **County  Road 10, Route 4, Box 181A, Marietta, OH**                                |   | **45750**                         |
| (Address of principal executive offices)                                            |   | (zip code)                        |
|                                                                                |   |                              |
| **(740)  373-6479**                                                                 |
| (Issuer's telephone number)                                                         |
|                                                                                |   |                              |
| (Former name, former address and former fiscal year,  if changed since last report) |

 

**APPLICABLE ONLY TO CORPORATE ISSUERS**

State thenumber of shares outstanding of each of the issuer's classes of common equity,as of the latest practicabledate:          2,412,966 commonshares, no par value

TransitionalSmall Business Disclosure Format (Check one): Yes oNo ý

 

**PART I — FINANCIAL INFORMATION**

 

**Item 1. Financial Statements.**

INDEX
|                                                                                                                                                                                 |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| Consolidated Balance Sheet  at September 30, 2001 (Unaudited)                                                                                                                        |   |
|                                                                                                                                                                                 |   |
| Statements of  Consolidated Income (Loss) for the Three Months Ended  September 30, 2001 and 2000 (Unaudited) and for the Nine Months Ended  September 30, 2001 and 2000 (Unaudited) |   |
|                                                                                                                                                                                 |   |
| Statements of  Consolidated Cash Flows for the Nine Months Ended  September 30, 2001 and 2000 (Unaudited)                                                                            |   |
|                                                                                                                                                                                 |   |
| Notes to  Consolidated Financial Statements                                                                                                                                          |   |

 

 

 

GASELTRANSPORTATION LINES, INC.

AND ITS SUBSIDIARY

CONSOLIDATED BALANCE SHEET

 
|                                       |   | **Sept 30,********2001** |       |
|--------------------------------------------|--------|--------------------------|------------|
|                                       |   | **(Unaudited)**          |       |
| ASSETS                                     |   |                     |       |
|                                       |   |                     |       |
| Current Assets                             |   |                     |       |
| Cash and Cash Equivalents                  |   | $                        | 20,432     |   |
| Accounts Receivable-Trade                  |   | 2,271,998                |       |
| Inventory                                  |   | 181,337                  |       |
| Prepaid Expenses and Other Current  Assets |   | 231,015                  |       |
|                                       |   |                     |       |
| Total Current Assets                       |   | 2,704,782                |       |
|                                       |   |                     |       |
| Property and Equipment                     |   |                     |       |
| Land and Buildings                         |   | 1,051,842                |       |
| Tractors                                   |   | 12,084,820               |       |
| Trailers                                   |   | 5,711,290                |       |
| Shop Equipment                             |   | 405,285                  |       |
| Office Equipment                           |   | 217,400                  |       |
|                                       |   | 19,470,637               |       |
| Less Accumulated Depreciation              |   | 7,225,277                |       |
|                                       |   |                     |       |
| Net Property and Equipment                 |   | 12,245,360               |       |
|                                       |   |                     |       |
| Deferred Income Taxes                      |   | 844                      |       |
|                                       |   |                     |       |
| Other Assets                               |   |                     |       |
| Goodwill                                   |   | 344,375                  |       |
| Other                                      |   | 75,003                   |       |
|                                       |   |                     |       |
| Total Other Assets                         |   | 419,378                  |       |
|                                       |   |                     |       |
| TOTAL ASSETS                               |   | $                        | 15,370,364 |   |

 

Seeaccompanying notes to consolidated financial statements.

 

 

 

GASEL TRANSPORTATION LINES, INC.

AND ITS SUBSIDIARY

CONSOLIDATED BALANCE SHEET

 

 
|                                                                                                 |   | **Sept 30,  2001** |                 |
|------------------------------------------------------------------------------------------------------|--------|--------------------|----------------------|
|                                                                                                 |   |               |
|                                                                                                 |   | **(Unaudited)**    |                 |
| LIABILITIES AND STOCKHOLDERS' EQUITY                                                                 |   |               |                 |
|                                                                                                 |   |               |                 |
| Current Liabilities                                                                                  |   |               |                 |
| Cash Overdraft                                                                                       |   | $                  | 219,054              |   |
| Notes Payable                                                                                        |   | 1,583,480          |                 |
| Accounts Payable-Trade                                                                               |   | 508,685            |                 |
| Accrued Contract Labor, Interest and  Other Expenses                                                 |   | 382,917            |                 |
| Current Portion of Long Term Debt                                                                    |   | 3,351,242          |                 |
|                                                                                                 |   |               |                 |
| Total Current Liabilities                                                                            |   | 6,045,378          |                 |
|                                                                                                 |   |               |                 |
| Long Term Debt                                                                                       |   | 8,227,811          |                 |
|                                                                                                 |   |               |                 |
| Total Liabilities                                                                                    |   | 14,273,189         |                 |
|                                                                                                 |   |               |                 |
| Stockholders' Equity                                                                                 |   |               |                 |
| Common Stock, no par value, 3,000,000  shares authorized, 2,412,966 issued and 2,405,066 outstanding |   | 1,539,640          |       |
| Additional Paid in Capital                                                                           |   | 223,229            |                 |
| Retained Earnings (Deficit)                                                                          |   | (592,319           | )                    |
| Less: Treasury Stock, at cost, 7,900  shares                                                         |   | (17,833            | )                    |
| Less: Notes Receivable                                                                               |   | (55,542            | )                    |
|                                                                                                 |   |               |                 |
| Total Stockholders' Equity                                                                           |   | 1,097,175          |                 |
|                                                                                                 |   |               |                 |
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                           |   | $                  | 15,370,364           |   |

 

 

 

See accompanying notes to consolidatedfinancial statements.

 

GASEL TRANSPORTATION LINES, INC.

AND ITS SUBSIDIARY

STATEMENTS OF CONSOLIDATED INCOME (LOSS)

 
|                                         |   | **Three Months Ended** |      | **Nine Months Ended** |   |
|----------------------------------------------|--------|------------------------|-----------|-----------------------|--------|
|                                         |   | **Sept 30,**           |      | **Sept 30,**          |   | **Sept 30,** |   | **Sept 30,** |   |
|                                         |   | **2001**               |      | **2000**              |   | **2001** |   | **2000** |   |
|                                         |   | **(Unaudited)**        |      | **(Unaudited)**       |   | **(Unaudited)** |   | **(Unaudited)** |   |
|                                         |   |                   |      |                  |   |   |   |   |   |
| Revenues                                     |   |                   |      |                  |   |   |   |   |   |
| Freight Income                               |   | $                      | 3,922,529 |                  | $      | 3,083,723 |   | $ | 13,860,106 |   | $ | 9,480,262 |   |
| Training School Revenue                      |   | 244,986                |      | 141,651               |   | 695,775 |   | 318,408 |   |
|                                         |   | 4,167,515              |      | 3,225,374             |   | 14,555,881 |   | 9,798,670 |   |
|                                         |   |                   |      |                  |   |   |   |   |   |
| Cost of Revenue                              |   | 3,695,769              |      | 3,057,649             |   | 12,203,471 |   | 8,649,665 |   |
|                                         |   |                   |      |                  |   |   |   |   |   |
| Gross Profit                                 |   | 471,746                |      | 167,725               |   | 2,352,410 |   | 1,149,005 |   |
|                                         |   |                   |      |                  |   |   |   |   |   |
| Operating  Expenses                          |   |                   |      |                  |   |   |   |   |   |
| Garage Expenses                              |   | 75,818                 |      | 67,646                |   | 223,434 |   | 215,245 |   |
| General and Administrative Expenses          |   | 511,838                |      | 362,597               |   | 1,576,209 |   | 1,075,703 |   |
|                                         |   | 587,656                |      | 430,243               |   | 1,799,643 |   | 1,290,948 |   |
|                                         |   |                   |      |                  |   |   |   |   |
| Operating Income (Loss)                      |   | (115,910               | )         | (262,518              | )      | 552,767 |   | (141,943 | ) |
|                                         |   |                   |      |                  |   |   |   |   |   |
| Other Income (Expense)                       |   |                   |      |                  |   |   |   |   |   |
| Interest Income                              |   | 833                    |      | 419                   |   | 2,422 |   | 9,315 |   |
| Other Income                                 |   | 19,438                 |      | 4,685                 |   | 98,404 |   | 24,238 |   |
| Interest Expense                             |   | (321,832               | )         | (223,161              | )      | (929,210 | ) | (644,514 | ) |
|                                         |   | (301,561               | )         | (218,057              | )      | (828,384 | ) | (610,961 | ) |
| Income (Loss) Before Tax Provision           |   | (417,471               | )         | (480,575              | )      | (275,617 | ) | (752,904 | ) |
|                                         |   |                   |      |                  |   |   |   |   |   |
| Provision for Income Taxes                   |   | (48,000                | )         | (149,000              | )      | -- |   | (238,000 | ) |
|                                         |   |                   |      |                  |   |   |   |   |   |
| Net Income (Loss)                            |   | $                      | (369,471  | )                     | $      | (331,575 | ) | $ | (275,617 | ) | $ | (514,904 | ) |
|                                         |   |                   |      |                  |   |   |   |   |   |
| Basic Earnings Per Share                     |   | $                      | (.154     | )                     | $      | (.149 | ) | $ | (.115 | ) | $ | (.231 | ) |
|                                         |   |                   |      |                  |   |   |   |   |   |
| Diluted Earnings Per Share                   |   | $                      | (.000     | )                     | $      | (.136 | ) | $ | (.000 | ) | $ | (.214 | ) |
|                                         |   |                   |      |                  |   |   |   |   |   |
| Weighted Average Common Shares  Outstanding: |   |                   |      |                  |   |   |   |   |   |
| Basic                                        |   | 2,405,066              |      | 2,230,066             |   | 2,405,066 |   | 2,230,066 |   |
| Diluted                                      |   | 0,000,000              |      | 2,440,066             |   | 0,000,000 |   | 2,402,703 |   |

 

 

 

See accompanying notes to consolidatedfinancial statements.

GASEL TRANSPORTATION LINES, INC.

AND ITS SUBSIDIARY

STATEMENTS OF CONSOLIDATED CASH FLOWS

 

 
|                                                                           |   | **Nine Months Ended** |     |
|--------------------------------------------------------------------------------|--------|-----------------------|----------|
|                                                                           |   | **Sept 30,**          |     | **Sept 30,** |   |
|                                                                           |   | **2001**              |     | **2000** |   |
|                                                                           |   | **(Unaudited)**       |     | **(Unaudited)** |   |
|                                                                           |   |                  |     |   |   |
| Cash  Flows From Operating Activities                                          |   |                  |     |   |   |
| Net Income (Loss)                                                              |   | $                     | (275,617 | ) | $ | (514,904 | ) |
| Adjustments to reconcile net income to  cash provided by operating activities: |   |                  |     |   |   |
| Deferred Taxes                                                                 |   | --                    |     | (238,000 | ) |
| Depreciation and Amortization                                                  |   | 1,777,525             |     | 1,357,536 |   |
| (Increase) Decrease in:                                                        |   |                  |     |   |   |
| Accounts Receivable-Trade                                                      |   | (791,358              | )        | (204,708 | ) |
| Inventory                                                                      |   | (11,575               | )        | 2,062 |   |
| Prepaid Expenses and Other Assets                                              |   | (75,429               | )        | (24,462 | ) |
| Increase (Decrease) in:                                                        |   |                  |     |   |   |
| Accounts Payable and Accrued Expenses                                          |   | 472,104               |     | 490,537 |   |
| Net Cash Provided by Operating  Activities                                     |   | 1,095,650             |     | 868,061 |   |
|                                                                           |   |                  |     |   |   |
| Cash  Flows From Investing Activities                                          |   |                  |     |   |   |
| Purchases of Property and Equipment                                            |   | (240,456              | )        | (120,755 | ) |
| Repayment of Accounts Receivable-  Affiliate                                   |   | --                    |     | 61,356 |   |
| Net Cash Provided (Used) by Investing  Activities                              |   | (240,456              | )        | (59,399 | ) |
|                                                                           |   |                  |     |   |   |
| Cash Flows From Financing Activities                                           |   |                  |     |   |   |
| Increase (Decrease) in Cash Overdraft                                          |   | (523,817              | )        | -- |   |
| Line of Credit (Net)                                                           |   | 301,187               |     | 493,931 |   |
| Proceeds from Long Term Borrowing                                              |   | 655,789               |     | -- |   |
| Repayment of Notes Receivable                                                  |   | 9,377                 |     | -- |   |
| Proceeds from Capital Lease Agreements                                         |   | 142,136               |     | -- |   |
| Payment for Stock Issuance Costs                                               |   | --                    |     | (3,785 | ) |
| Principal Payments on Long Term  Borrowing                                     |   | (1,126,701            | )        | (1,203,475 | ) |
| Principal Payments Under Capital Lease  Agreements                             |   | (300,469              | )        | (115,945 | ) |
| Net Cash Provided (Used) by Financing  Activities                              |   | (842,498              | )        | (829,274 | ) |
|                                                                           |   |                  |     |   |   |
| Net Increase (Decrease)in Cash                                                 |   | 12,696                |     | (20,612 | ) |
|                                                                                |        |                       |          |  |  |  |  |

 

 

 

 

See accompanying notes to consolidatedfinancial statements.

GASEL TRANSPORTATION LINES, INC.

AND ITS SUBSIDIARY

STATEMENTS OF CONSOLIDATED CASH FLOWS

(continued)

 

 
|                                                                |   | **Nine Months Ended** |          |
|---------------------------------------------------------------------|--------|-----------------------|---------------|
|                                                                |   | **Sept 30,**          |          | **Sept 30,** |   |
|                                                                |   | **2001**              |          | **2000** |   |
|                                                                |   | **(Unaudited)**       |          | **(Unaudited)** |   |
|                                                                |   |                  |          |   |   |
| Net Increase (Decrease)in Cash                                      |   | $                     | 12,696        |   | $ | (20,612 | ) |
|                                                                |   |                  |          |   |   |
| Cash & Cash Equivalents-Beginning of Period                     |   | 7,736                 |     | 20,612 |     |
|                                                                |   |                  |          |   |   |
| Cash & Cash Equivalents-End of Period                           |   | $                     | 20,432        |     | $ | 0 |     |
|                                                                |   |                  |          |   |   |
|                                                                |   |                  |          |   |   |
| Supplemental Disclosures:                                           |   |                  |          |   |   |
|                                                                |   |                  |          |   |   |
| Interest Paid                                                       |   | $                     | 794,783       |   | $ | 644,514 |   |
|                                                                |   |                  |          |   |   |
| Non-Cash Investing and Financing  Activities                        |   |                  |     |   |     |
|                                                                |   |                  |          |   |   |
| Purchases of Property and Equipment  with Proceeds of Notes Payable |   | $                     | 1,244,530     |   | $ | 2,353,245 |   |
|                                                                |   |                  |          |   |   |
| Payoff Various Notes With Proceeds from  New Financing              |   | $                     | 4,224,110     |   | $ | 894,234 |   |

 

 

 

See accompanying notes to consolidatedfinancial statements.

GASEL TRANSPORTATION LINES, INC.

AND ITS SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIALSTATEMENTS

(Unaudited)

 

 

 

**NOTE 1 - BASIS OF PRESENTATION**

 

Theaccompanying unaudited consolidated financial statements of GaselTransportation Lines, Inc. and its subsidiary (the “Company”) have beenprepared in accordance with generally accepted accounting principles forinterim financial information and with the instructions to Form 10-QSB andArticle 10 of Regulation S-X. Accordingly, they do not include all the information and footnotesrequired by generally accepted accounting principles for complete financial statements.  In the opinion of management, alladjustments considered necessary for a fair presentation (consisting of normalrecurring accruals) have been included. The preparation of financial statements in conformity with generallyaccepted accounting principles requires management to make estimates andassumptions that affect the reported amounts of assets and liabilities anddisclosure of contingent assets and liabilities at the date of the financialstatements and the reported amounts of revenues and expenses during thereporting period.  Actual results coulddiffer from those estimates.  Operatingresults for the nine month period ended September 30, 2001 are not necessarilyindicative of the results that may be expected for the year ending December 31,2001.  For further information, refer tothe consolidated financial statements and footnotes thereto included in theCompany’s Report on Form 10-SB for the year ended December 31, 2000.

**         Item 2.  Management’sDiscussion and Analysis of Financial Condition and Results of Operations.**

 

Overview.

 

The following discussion should be read inconjunction with the Financial Statements, including footnotes, containedherein.  The discussion is qualified inits entirety by the foregoing. Historical results of operations and the percentage relationships amongany amounts in the Financial Statements, and any trends that may appear to beinferable therefrom, should not be taken as necessarily indicative of trends ofoperations or results of operations for any future periods.

The discussion contains forward-lookingstatements.  These forward-lookingstatements involve risks and uncertainties, and the cautionary statements setforth below identify important factors that could cause actual results todiffer materially from those predicted in the forward-looking statements.  These factors include, but are not limitedto, adverse changes in general economic conditions, including adverseconditions to the companies that are the Company’s core of shippers, fuelprices, driver costs, the ability to have enough drivers to utilize the Companyequipment, the ability to finance equipment, interest rates, the ability toborrow working capital, and other factors.

The interim financial information for thequarters and nine months periods ended September 30, 2001, and September 30,2000, are unaudited.  The statementsincluded reflect all adjustments that the Company considers necessary for afair presentation of the results of operations for the interim periods coveredand of the financial condition of the Company at the date of the interimbalance sheet.  The results of theinterim periods are not necessarily indicative of the results for the entireyear.

Three Months Ended September 30, 2001.

Freight revenues for the three months endedSeptember 30, 2001, were $3,922,529, an increase of $838,806 (27.2%) from the$3,083,723 in revenues for the third quarter of 2000, but a decrease from the$4,989,226 in revenues for the prior quarter. The increase in freight revenues from the prior year was basicallyattributable to the Company having acquired Eagle Transportation Services, Inc.("Eagle") effective January 2001, which included the purchase of 10tractors, and its brokerage and logistics business, including 8 owner-operatorswho formerly worked for Eagle.  Revenuesincreased from all of these sources, plus better utilization of Company ownedequipment on business generated from the Eagle customer base.

Training school revenues for the thirdquarter of 2001 were $244,986, a 73.0% increase from the third quarter 2000revenues of $141,651.   Training school revenue increases were due tohaving opened a school in Lima, Ohio since the same period last year, increasedtuition costs to the students and an overall increase in the number of students.

Equipment operating expenses increased in thethird quarter of 2001 to $3,695,769 from $3,057,649 for the third quarter of2000 but less than the $4,222,765 for the prior quarter, which is expectedsince these expenses are a function of the amount of revenues and the equipmentrequired to generate them and revenues were down from the prior quarter.  However, this amount was an increase of$638,120 (20.9%) from the prior year. The increase in expenses was primarily due to the increase in the amountof equipment being operated and the added costs associated with operating theformer Eagle operations as a division of the Company.  Operating expenses were also up, going to $587,656 for the thirdquarter of 2001 compared to $430,243 for the like period of 2000, which is anincrease of $157,413 (36.6%).

Operatingincome for the third quarter of 2001 was a loss of ($115,910), an improvementof $146,608 from the loss of ($262,518) for the same period of 2000, but asignificant decrease from the operating income of$385,179 for the prior quarter. Operating income as a percentage of total revenues went down from anegative 8.5% in the quarterly period ended September 30, 2000, to a negative3.0% for the same period in 2001. Contributing factors to the improvement were primarily the reduced costof diesel fuel resulting from various cost control measures and increasedrevenues per tractor, which were partially offset by increased general andadministrative costs on both an absolute basis and as a percentage of totalrevenue.

The net results were that the Company had anet loss after provision for income taxes for the third quarter of 2001 of($369,471) compared to a net loss of ($331,575) for the third quarter of 2000,which is an increase of $37,896 (11.4%) from the prior year.  This net loss for the quarter is in contrastto the $47,799 of net income for the prior quarter of 2001.

The results for the three month period endingSeptember 30, 2001, were primarily due to a decrease in the rates from theCompany’s lead customer and a significant decline in the Marietta, Ohiooutbound freight volume.  An additionalcontributing factor to the loss was the shutdown of the freight brokeragebusiness and the loss of its attendant higher profit margins; the shutdown wasthe result of the Company’s continuing cash flow problems and the consequentialinability to pay for the brokerage operation in a timely manner.

Nine months Ended September 30, 2001.

Freight revenues for the nine months endedSeptember 30, 2001, increased $4,379,844 (46.2%) to $13,860,106 from $9,480,262at the end of the nine months period ending September 30, 2000.  Training school revenues for the nine monthsended September 30, 2001, increased $377,367 to $695,775 (118.6%) from $318,408for the nine months period ended September 30, 2000.  The increase in freight revenues was, as stated for the quarterlyresults, basically attributable to the Eagle acquisition and the attendantincreases in operating equipment, brokerage revenues from Eagle’s brokerageoperation, and increased revenues per mile resulting from better rates obtainedfrom Eagle’s customer base and increased revenues from the contract customerbase of Company prior to the Eagle acquisition resulting from anacross-the-board increase in freight rates that was instituted in January 2001.

Training school revenue increases were due tothe additional school, increased tuition costs and increased numbers ofstudents.

Equipment operating expenses increased in thenine months period ended September 30, 2001, by $3,553,806 (41.1%) to $12,203,471 from $8,649,665 for the same period in 2000.  The increase in expenses was basicallyproportional to the increase in revenues, which as stated for the 3rd quarterresults, was primarily due to the increase in the amount of equipment beingoperated, and increased operations with the attendant expenses associatedtherewith.  Operating expenses increased$508,695 (39.4%) to $1,799,643 for the nine months ended September 30, 2001,compared to $1,290,948 for the same period of 2000.  The increase was almost entirely attributable to the increases inthe general and administrative costs, most of which is due to adding theoperation of the Eagle division in 2001.

Operatingincome for the nine months ended September 30, 2001, was$552,767, an increase of $694,710 (489.4%) from a loss of ($141,943) for thesame period in 2000.  Operating incomeas a percentage of total revenues went up from a negative (1.4%) for the ninemonths ending September 30, 2000, to 3.8% for the same period in 2001.  The factors for the increase for this periodwere basically increased fuel efficiency, increased revenues per mile, andhigher profit margins from brokering freight, reduced in part by the increased generaland administrative costs.

The net results were that the Company had anet loss after provision for income taxes for the nine months period endedSeptember 30, 2001, of ($275,617) compared to a net loss of ($514,904) for thesame period of 2000, which is a decrease of $239,287 from the prior year’sloss.

Capital and Liquidity.

Although improved from the end of last year,the Company continues to carry a negative working capital position.

In its efforts to offset the deficit workingcapital position resulting from last year's losses, the Company obtainedworking capital from new borrowings, negotiated a decrease in its monthlyequipment payments to its major equipment lenders and instituted measures tooperate more profitably.

The Company posted positive earnings throughthe 2nd quarter of 2001 and earnings continue to be significantly better thanlast year.  However, profits slippedinto a negative position year-to-date after posting a loss for the thirdquarter this year-which was the first quarter this year without a profit.

Largely, the declining financial performanceduring the third quarter of 2001 was a result of weak freight demand, rate cutsfrom a major customer, and rising industry costs following the nation's furtherslide into an economic decline, exacerbated by the events of September 11,2001.

Corrective actions including increasingrates, improving equipment productivity, and decreasing General &Administrative expenses continue, with the expectation to improve the Company'scash flow from these actions and from earnings in the fourth quarter of thisyear.

The Company continues efforts to seekpermanent working capital in the form of equity to recapitalize its existingoperations and fund future growth plans. Recently, the Company engaged the services of an investment banking firmexperienced in transportation transactions to assist in this effort.  Further, the Company continues its effortsto seek means of providing permanent working capital, including privateplacement of securities to investors, seeking additional acquisitions or growthstrategies, and considering other strategic alternatives.

**PART II — OTHER INFORMATION**

**Item 6. Exhibits and Reports on Form 8-K**

(B)Reports on Form 8-K

 

There were no reports filed on Form 8-K during thequarter ending September 30, 2001.

**SIGNATURES**

Inaccordance with the requirements of the Exchange Act, the registrant causedthis report to be signed on its behalf by the undersigned, thereunto dulyauthorized.
|   |                   | Gasel  Transportation Lines, Inc        |
|--------|------------------------|-----------------------------------------|
|   |                   | (Registrant)                            |
|   | Date  November 8, 2001 | /s/  Michael J. Post                    |
|   |                   |                                    |
|   |                   | (Signature)*Michael  J. Post, President |
|   | Date                   |                                    |
|   |                   |                                    |
|   |                   | (Signature)*                            |
|   |                   |                                    |