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Quotes & Info
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| ADNW.OB > SEC Filings for ADNW.OB > Form 10QSB on 15-Jul-2004 | All Recent SEC Filings |
15-Jul-2004
Quarterly Report
During the first quarter ended May 31, 2004, work continued on productdevelopment programs as planned and the individual items are detailed below. Inthe quarter ended May 31, 2004, compared to the quarter ended May 31, 2003:General and administrative expenses increased from $531,378 in the quarter endedMay 31, 2003, to $1,764,487 in the corresponding quarter for 2003. The mainreason for the increase was the further development of the Company'sinfrastructure to support its planned growth.
In the quarter ended May 31, 2004 the Company reported an increase in revenuesto $16,080,235, up from $3,322,289 in the corresponding quarter from theprevious year, reflecting the continuing impact of our acquisition program.
The company made a net profit of $1,113,743 in the quarter ended May 31, 2004which compares with a net profit of $354,404 for the corresponding quarter in2003. The Company's performance in this quarter is reflective of its ongoingexpansion. It is anticipated that the company will be able to meet its financialobligations through internal net revenue in the foreseeable future. Total assetshave increased to $62,098,306.
Liquidity & Capital Resources - Between February 12, 2004, and March 30, 2004,the Company sold an aggregate total of 5,105,881 shares of Series B-1 PreferredStock Convertible Notes, of which 764,581 Series B-1 Preferred Shares were soldto those preferred stockholders who elected to exercise their preemption rights,and between March 31, 2004 and May 20, 2004 the Company sold an aggregate totalof 272,526 shares of Series B-2 Preferred Stock Convertible Notes ("Series BPreferred Stock"). All of these sales were made in reliance upon exemptions fromregistration under the Securities Act of 1933, as amended (the "Act"). TheCompany sold all of the Series B Preferred Stock for $3.80 per share. Each ofthe Series B Preferred Stock shares is currently convertible into two (2) sharesof our common stock. For each five (5) shares of Series B Preferred Stockpurchased, subscribing investors received warrants to purchase two (2) shares ofthe Company's common stock at an initial exercise price equal to $2.50 pershare. In addition, the Company issued warrants to purchase up to 1,068,085shares of our common stock to various investment advisors and consultants. Thesewarrants are exercisable at the price of $1.90 per share. The Company used thesefunds primarily to complete its investment in DCS Automotive Limited and workingcapital to accelerate the development of its lead products. We believe thisfunding will be sufficient to support our business plan. Should we come upagainst any unforeseen problems, the Company will revisit its budget and adjust
its costs to allow the Company to operate until sufficient long term funding isachieved. However, a key element of our business strategy is to continue toacquire and develop new technologies and products that we believe offer uniquemarket opportunities and/or complement our existing product lines.
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