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| AMWW.OB > SEC Filings for AMWW.OB > Form 10QSB on 20-Aug-2007 | All Recent SEC Filings |
20-Aug-2007
Quarterly Report
Forward Looking Statements
This report contains certain forward-looking statements as defined by the Securities Act of 1933 and the Securities Exchange Act of 1934. AIMS™ Worldwide, Inc., cautions readers that expressions of future goals and similar expressions reflecting something other than historical fact are intended to identify forward-looking statements. Words such as "May," "Will," "Expect," "Believe," "Anticipate," "Intend," and comparable terminology are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. These forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those currently anticipated or discussed in this report. Factors that may affect our results include, but are not limited to, market acceptance of our products and technologies, our ability to secure financing, potential competition from other companies with greater technical and marketing resources, and other factors described in our filings with the Securities and Exchange Commission.
General
We incorporated in the State of Nevada on March 7, 1996, under the name B & R
Ventures, Inc. On March 28, 1999, we acquired all of the common stock of Enjoy
The Game, Inc., a Missouri corporation, and changed our name to EtG Corporation.
At that time we began operating as a media and merchandising company to promote
the positive aspects of athletic competition. EtG Corporation conducted its
operations through its subsidiary, Enjoy the Game, Inc., which had been
incorporated in the state of Missouri on May 28, 1998. Enjoy the Game, Inc.
failed to achieve profitable operations, and on November 15, 2002, we sold the
Subsidiary back to its president.
On December 17, 2002, we acquired AIMS™ Worldwide, Inc. AIMS™ Worldwide, Inc., incorporated in Nevada on October 7, 2002 as Accurate Integrated Marketing Solutions Worldwide, Inc., to act as the successor to AIMS™ Group, LLC which was organized in Virginia in November 2001. As a result of this acquisition, we changed our name to AIMS™ Worldwide, Inc.
Our principal executive offices are at 10400 Eaton Place, #203, Fairfax, VA 22030. Our telephone number is 703/621-3875, and our facsimile number is 703/621-3870. Our URL is www.AIMSWorldwide.com
Our Business
AIMS™ Worldwide, Inc., ("AIMS™") is a vertically integrated marketing communications consultancy providing organizations with its AIMSolutions branded focused marketing solutions at the lowest possible cost. AIMS™ (Accurate Integrated Marketing Solutions) increases the accuracy of the strategic direction of its client's marketing program, improves results and reduces the cost, by refocusing "mass marketing" to a more strategic "One-2-One™" relationship with the ideal customer. To further differentiate from the rest of the market, AIMS™ places intense focus on the Return on Marketing Investment, or "ROMI™." The Company's goal is to provide clients with a measurable return by first conducting an audit of the client's existing marketing strategy in order to deliver an increased return on their investment. AIMS™ is accelerating its growth by targeting and acquiring a group of core competency media and marketing communications services companies.
It is our intention to structure the Company into seven major business units ("MBUs"): AIMSolutions Consulting, Advertising Services, Strategy and Planning, Public Affairs, Public Relations, Digital Marketing and Media Properties. To this end we have entered strategic partnerships, acquired certain subsidiaries, and are in the process of acquiring additional core competency companies to achieve our desired organization.
AIMSolutions Consulting Group will focus on the use and application of the AIMS™ ROMI™ process to provide marketing strategies, plans, and manage AIMS™ marketing programs for its clients.
AIMS™ Strategy and Planning Group has teamed with its subsidiaries/strategic
partner companies Harrell Woodcock Linkletter, Streetfighter Marketing, Inc.,
and Bill Main & Associates (purchased by AIMS Worldwide, Inc., on May 16, 2007).
This group provides marketing research, strategy, planning, consulting and
training programs that provide cost effective methods and techniques to clients
in advertising their services and products, plus effective selling and
telemarketing skills.
AIMS™ Public Affairs Group and strategic partner IKON Holdings, Inc., will concentrate on bringing the best and latest information and ideas from around the United States concerning candidates, public issues, public policy, legislation, state and local ballot measures. This group will provide solutions to finding information on issues and organizations concerning local, state and national governments.
AIMS™ Public Relations Group and a strategic partner, a New York City public relations firm, will concentrate on creating public relations, publicity and special events through various media, networking, and promotions for its clients.
AIMS™ Digital Marketing Group and its strategic partners Target America, Inc., and Advocast, Inc., will focus its activities on using and applying digital technologies for improving ROMI™ for AIMSolutions Consulting Group clients.
AIMS™ Media Group includes the Company's subsidiary AIMS™ Interactive, Inc., and ATB Media, Inc., which owns a 40% participation interest in Radio Station KCAA in Loma Linda/San Bernadino, California, and minority interest in Group One Broadcasting, Inc., a Scottsdale, Arizona operator of the Talk One Radio Network. Although the Company sold Prime Time Broadband, Inc., on May 31, 2007, the Company retained marketing rights with the purchaser, Ygnition Networks, whose national subscriber base is in excess of 40,000, representing a wide demography, substantially larger and more diverse than that of Prime Time Broadband, Inc.
AIMSolutions during the past four years has been a research and development
consulting practice refining its accurate integrated marketing solutions
processes to "go to market" and sell the marketing solution product to fee-paid
clients. AIMSolutions has undertaken a number of client beta-tests in the
on-going development of its vertically integrated marketing solution process.
Beta-test clients have been in a number of applications industries including
but not limited to public policy issues, political campaign marketing, consumer
electronics, medical and health care, distribution services, consumer package
goods, restaurant, food service, and hospitality, etc. The scope of these
industry development activities has established a platform of knowledge,
processes, and intellectual properties, sufficient as a proof-of-concept to
introduce AIMSolutions and "go to market" in 2007. Based on the aforementioned,
management believes that we have completed our research and development stage,
and AIMSolutions will be entering its going-concern revenue-driven consulting
practice.
Trademarks and Licenses
We hold common law trademarks on AIMS™ and ROMI™, and One-2-One™. AIMS™ is a unique doctrine, process, intellectual property, delivery system and corporate development method integrated into what we believe is a powerful client/customer centric professional service model.
AIMS™ is an audio-logical-acronym for Accurate Integrated Marketing Solutions.
AIMS™ is a proprietary marketing service, process, and delivery system designed
to improve the aim, reduce the cost and focus the reach to target a market on a
"one-to-one" basis. We believe AIMS™ and its consultancy brand AIMSolutions
will achieve a client company's goals and objectives, maximizing the client's
Return On Marketing Investment ("ROMI™").
Myaims.com is an intellectual property for our online business and delivery service of our products. Our websites, www.myaims.com and www.aimsworldwide.com are registered internet domain names owned and controlled by AIMS™ Worldwide, Inc.
We also hold a technology license agreement with Advocast, Inc., a proprietary public issues digital marketing application service provider.
Streetfighter Marketing, Inc., holds a common law trademark which is "Street Fighter Marketing" as well as the url for www.streetfightermarketing.com.
Subsidiaries
As part of its corporate development core competency acquisition strategy, AIMS™ Worldwide, Inc., owns the following subsidiaries:
Bill Main and Associates, Inc.
On May 16, 2007, we acquired 100% of the outstanding common stock of Barbara Overhoff, Inc., (a California corporation) d/b/a Bill Main and Associates, in exchange for 825,500 shares of our own common stock and $175,000. We recorded this acquisition as a purchase and include operations of this company in our consolidated financial statements from the date of acquisition. Bill Main and Associates specializes in restaurant, food service, hospitality and retail industry market research, strategies, planning, training, and advisory services that assist client businesses with marketing and promotion that lead to increasing top line revenues at the lowest possible cost.
Streetfighter Marketing, Inc.
On October 26, 2006, we acquired 100% of the outstanding common stock of Streetfighter Marketing, Inc. (an Ohio Corporation), d/b/a Street Fighter Marketing, in exchange for 722,222 shares of our own common stock. We recorded this acquisition as a purchase and include operations of this company in our consolidated financial statements from the date of acquisition. Streetfighter Marketing, Inc., specializes in training businesses how to market, promote and increase sales on a shoestring budget.
Harrell, Woodcock, & Linkletter, Inc.
HWL was a strategy and planning company that, at the time of purchase, had letters of intent to acquire Bill Main and Associates and Streetfighter Marketing. The acquisition by AIMS assigned the letters of intent to AIMS.
ATB Media, Inc.
On April 19, 2004, we acquired ATB Media, Inc. ("ATB"). ATB was formed to acquire radio broadcast properties and/or invest in companies that had previously acquired radio broadcast properties in small and medium-sized markets and to use innovative techniques and low cost, engineering-driven strategies to upgrade these properties into successful radio stations by relocating such properties to larger markets, increasing authorized power and/or authorized hours of operation. ATB owns rights to receive income participation from one or more radio stations and other businesses.
ATB currently owns a 40% participating interest in Radio Station KCAA in Loma Linda/San Bernadino, California and owns rights to receive income participation from one or more radio stations if and when acquired.
ATB holds a minority interest in Group One Broadcasting, Inc. that was organized to, among other matters, meet the needs and demands for quality radio programming. Group One Broadcasting, Inc. is the operator of the Talk One Radio Network in Scottsdale, Arizona.
AIMS™ continues to work its broadcast partners to upgrade its radio station KCAA-AM in Loma Linda, California. Last year the station was listed for sale but it is not listed at this time. Upon a successful completion of a sale, AIMS™ anticipates elimination of most of its debt resulting from its acquisition of ATB on April 19, 2004.
Stock Purchase Agreements
In addition to the completed acquisitions, AIMS™ had, as of June 30, 2007, issued two definitive purchase agreements to acquire a public affairs company and a digital marketing company; and the Company anticipated completing the purchases in the third quarter, which subsequently occurred. The Company had presented Stock Purchase Agreements to IKON Holdings, Inc., of Washington D.C., and Target America, Inc. of Fairfax, Va. In addition, the Company had presented a Letter of Intent to a Washington, D.C.-based public relations firm. The Company had anticipated purchasing 100% of Target America for cash and stock and 55% controlling interest in IKON Holdings, Inc., for cash and stock, both of which occurred as planned.
Competition
Marketing and Media services in its various forms are one of the most competitive segments of business, commerce and enterprise management. With its recent introduction, changes and dynamics caused by new online/ interactive communication technologies to the traditional/offline communications mediums (broadcast, satellite cast, print, post and telephone) the marketing landscape has become one of the most complex competitive tapestries in the world.
Our internal research indicates that an estimated worldwide $1 trillion dollars is spent annually on the full range of marketing, marketing communications, marketing services and delivery systems this is a massive, diverse and fragmented service industry.
As such, globally there can be little doubt as to the competition in the marketing services space in which the leading companies, agencies and firms are better established, positioned, branded, staffed and capitalized than our Company.
AIMS™ management has undertaken comprehensive industry research including evaluation of the full scope of marketing services including, but not limited to, advertising (Top 100), direct marketing (Top 20), sales promotion (Top 20), public relations (Top 20), market research (Top 25) and marketing support services (Top 200). Based on our analysis, AIMS™ believes that traditional media and marketing services, while with far greater financial and human resources than the company, do not currently offer the integrated solutions AIMS™ provides.
Employees
AIMS™ Worldwide, Inc., corporate headquarters has five employees, and including our wholly-owned and operating subsidiaries, has a total of approximately fifteen employees. We plan to hire additional personnel on an as-needed basis as our operations expand.
Description of Property
Our corporate headquarter is at 10400 Eaton Place, Suite 203, Fairfax, Virginia 22030. We have an additional office in Tampa, Florida at a cost of $303 per month under a month-to-month arrangement. Our subsidiary Streetfighter Marketing, Inc., leases office space in Gahanna, Ohio, and our subsidiary Bill Main and Associates leases office space in Chico, Calif.
We had $26,223 in revenue for the three months ended June 30, 2007, compared with $322,165 in revenue for the same three month period of 2006; a reason for the drop in revenue was due to the sale of Prime Time Broadband, Inc. If accounting policy were to permit the Company to include revenue from Prime Time Broadband for April and May, 2007, our revenues for the quarter would have increased by $100,000+. In addition, activity generated from AIMSolutions contracts during the same period in 2006 contributed to the quarter revenue substantially. Cost of sales was $10,745, leaving a gross profit of $15,478 for the three month period of 2007 compared to cost of sales of $16,730 and a gross profit of $305,435 for the same three month period of 2006.
Our general and administrative expenses were $727,113 for three months ended June 30, 2007 compared to general and administrative expense of $567,697 for the same period in 2006. The primary reason for the increase is attributed to acquisition and disposition costs along with normal G&A expenses added by including the new subsidiary, Streetfighter Marketing, Inc. Our operating loss for the three months ended June 30, 2007, was $711,635 compared to $262,262 for the same period in 2006; the primary reason for the increase in the operating loss was the activity generated from major AIMSolutions contracts during the same period in 2006.
Six Month Periods Ended June 30, 2007 and 2006
We had $135,551 in revenue for the six months ended June 30, 2007, compared with $368,692 in revenue for the same six month period of 2006. Cost of sales was $36,975, leaving a gross profit of $98,576 for the first six month period of 2007 compared with cost of sales of $42,132 and a gross profit of $326,560 for the same six month period of 2006.
Our general and administrative expenses were $1,183,010 for the six months ended June 30, 2007 compared to general and administrative expense of $1,057,593 for the same period in 2006. Our operating loss for the six months ended June 30, 2007, was $1,084,434 compared to $731,033 for the same period in 2006.
Liquidity and Capital Resources
At June 30, 2007, we had total current assets of $443,778 consisting of $150,061 in cash, $170,052 in accounts receivable, $5,500 of inventory and $118,165 in prepaid expenses. Equipment, net of accumulated depreciation was $81,604 and other assets included $290,000 in loans and deposits on acquisition targets and $1,267,311 in net intangible assets which includes non-compete employment agreements, the Street Fighter and Bill Main brand and copyrights, and letters of intent.
Our liabilities at June 30, 2007, totaled $4,816,926 and consisted of $711,063 in accounts payable, $46,800 in deferred revenue, $975,971 in notes payable to related parties, $804,742 in accrued interest payable to related parties, $1,409,736 in notes payable and $868,614 in accrued interest.
We are still a relatively new company and have not yet fully implemented our business plan. Due to our lack of profitable operations, our auditors have expressed substantial doubt about our ability to continue as a going concern. We do not have any long-term capital commitments and we believe that our immediate needs can be met with a combination of cash on hand and through ongoing operations. However, we will require additional capital to fully implement our business plan. We are currently negotiating to acquire other media providers and estimate that we will have to raise approximately $10,000,000 during the coming year for operating expenses and acquisition costs. We will also have ongoing legal and auditing expenses as well as office and lease expenses. If we cannot generate sufficient capital through ongoing operations, we will likely sell common stock, seek advances from officers or explore other debt financing strategies.
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