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| PRBL.OB > SEC Filings for PRBL.OB > Form 10QSB on 11-May-2004 | All Recent SEC Filings |
11-May-2004
Quarterly Report
Cautionary Statement Regarding Forward-looking Statements - This report may contain "forward-looking" statements. Examples of forward- looking statements include, but are not limited to: (a) projections of revenues, capital expenditures, growth, prospects, dividends, capital structure and other financial matters; (b) statements of plans and objectives of our management or Board of Directors; (c) statements of our future economic performance; (d) statements of assumptions underlying other statements and statements about us and our business relating to the future; and (e) any statements using the words "anticipate," "expect," "may," "project," "intend" or similar expressions.
General - We have completed the construction of our pilot sodium plant in Salt Lake City, Utah. The pilot plant has successfully produced small quantities of metallic sodium. Plans for demonstration projects for our Hydrogen On Demand generators are on hold pending funding. We are engaged in discussions with a fuel cell manufacturer regarding a possible joint venture arrangement but such discussions having been in process for some time with no results to date due to funding problems and no agreements have been reached. We are considering looking for alternative business combinations with entities who may not be involved in related industries but have not identified any prospects to date.
Results of Operations - Three Months Ended March 31, 2004 compared with 2003 - Revenues. We expect that our initial revenues may be derived from the licensing of the Technology and/or manufacturing and sale of hydrogen generation systems. We had no revenues for the three months ended March 31, 2004 and have had no revenues since July 9, 1997 ("Inception").
Operating Expenses. For the three months ended March 31, 2004, we had total operating expenses of $41,336, compared to $141,955 for the three months ended March 31, 2003. The decrease in operating expenses in 2004 compared to 2003 is attributable to decreases general and administrative expenses, professional fees, and in research and development expenses. The decreases are consistent with our plans to keep operating expenses to a minimum while we are engaged in seeking a business partner or business combination opportunity.
Other Income. Other income for the three months ended March 31, 2004 consisted of $41 in interest income. Other income for the three months ended March 31, 2003 consisted of $1,250 of interest income.
We experienced a net loss of $41,295 for the three months ended March 31, 2004 compared to a net loss of $140,705 for the prior year period. Our net loss since inception has been $3,224,792. The net loss per share for the three months ended March 31, 2004 was $0.01, compared to a net loss per share for the three months ended March 31, 2003 of $0.03. The net loss per share since inception has been $1.23.
Liquidity and Capital Resources - At March 31, 2004, we had current assets of $6,047 and current liabilities of $18,224 for a working capital deficit of $12,177. At March 31, 2003, we had property and equipment of $4,725, net of depreciation, and patents and license agreements net of amortization, of $37,922.
Our cash used in operations for the three months ended March 31, 2004 was $37,512, compared to $121,455 for the same period the prior year. Since inception, our operations have been funded primarily by cash received from capital contributions and the issuance of common stock for cash.
We did not engage in investing activities for the three months ended March 31, 2004 or 2003.
We did not engage in financing activities for the three months ended March 31, 2004. Cash flows from financing activities during the three months ended March 31, 2003 totaled $209,000, from the issuance of common stock.
Our working capital has come mainly through the sale of our securities. Proceeds generated from the sale of our securities have funded our operations, including continued research and development activities.
Because no definitive agreements to utilize our technology have been reached, management is considering all options for developing revenues, including joint ventures, licensing arrangements and business combinations, although no potential business partners have been identified to date.
We expect that during the next year our primary expenditures will be for maintaining existing operations and for exploring projects and possibilities for the commercialization of our hydrogen generation equipment and powerball production, as well as expenses and professional and related fees associated with our ongoing reporting obligations. We hope to raise additional capital in fiscal 2004 through a private placement of our securities and/or through a licensing of our technology to an industrial partner. However, at this filing date we do not have any agreements for funding through such a private placement or any immediate prospects for a licensing agreement.
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