<PAGE>
EXHIBIT 99.A
A.C.L.N. Limited
Consolidated Financial Statements
Quarter Ended June 30, 2000
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A.C.L.N. LIMITED
CONTENTS
CONSOLIDATED FINANCIAL STATEMENTS:
Balance sheets 3
Statements of income 4
Statements of shareholders' equity 5
Statements of cash flows 6
Notes to financial statements 7-8
<PAGE>
A.C.L.N. LIMITED
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, 2000 December 31, 1999
(Unaudited) (Audited)
----------------------------------------------------------------------------------------------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 43,527,960 $13,944,855
Cash restricted as to withdrawal 25,506,147 63,630,117
Accounts receivable 29,993,816 2,400,864
Deferred expenses 709,067 261,762
FIXED ASSETS:
Advance for vessels' construction 10,000,000 --
Sea vessels 5,970,000 --
Furniture and fittings 4,970 5,474
Deposits 5,391 5,702
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$115,717,351 $80,248,774
====================================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accruals $ 16,025,984 $ 884,541
Amounts due to related parties 34,297 36,272
Income taxes payable 3,879,503 3,012,615
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19,939,784 3,933,428
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COMMITMENTS
SHAREHOLDERS' EQUITY:
Ordinary shares, stated value of C(pound) 0.008 (1999: C(pound)
0.010) each 11,040,865 (1999:8,832,692) shares
issued and outstanding 170,112 170,112
Paid-in capital 20,763,972 20,763,972
Retained earnings 74,778,100 55,320,409
Accumulated other comprehensive income 65,383 60,853
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TOTAL SHAREHOLDERS' EQUITY 95,777,567 76,315,346
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$115,717,351 $80,248,774
====================================================================================================
</TABLE>
3
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A.C.L.N. LIMITED
CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------
Three month period Six month period
ended June 30, ended June 30,
---------------------------------------------------------
(Unaudited) (Unaudited)
2000 1999 2000 1999
<S> <C> <C> <C> <C>
---------------------------------------------------------------------------------------------------------------
SALES
Sales of automobiles 19,800,000 -- 40,200,000 --
Shipping revenues 20,013,876 24,461,700 28,239,168 44,175,420
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TOTAL REVENUES $ 39,813,876 $ 24,461,700 $ 68,439,168 $ 44,175,420
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COST OF SALES
Cost of automobiles 13,680,000 -- 27,680,000 --
Cost of shipping revenues 14,073,200 17,595,998 18,494,022 32,058,666
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TOTAL COST OF SALES 27,753,200 17,595,998 46,174,022 32,058,666
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GROSS PROFIT 12,060,676 6,865,702 22,265,146 12,116,754
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 1,077,463 1,166,992 2,066,979 2,010,874
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INCOME FROM OPERATIONS 10,983,213 5,698,710 20,198,167 10,105,880
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OTHER INCOME (EXPENSE)
Interest income 298,125 -- 298,125 --
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298,125 -- 298,125 --
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INCOME BEFORE INCOME TAXES 11,281,338 5,698,710 20,496,292 10,105,880
INCOME TAXES 568,987 268,284 1,038,601 476,189
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NET INCOME 10,712,351 5,430,426 19,457,691 9,629,691
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OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:
FOREIGN CURRENCY TRANSLATION ADJUSTMENTS 528 2,394 4,530 (41,365)
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COMPREHENSIVE INCOME $ 10,712,879 $ 5,432,820 $ 19,462,221 $ 9,588,326
===============================================================================================================
NET INCOME PER SHARE - BASIC $ 0.97 $ 0.53 $ 1.76 $ 0.94
===============================================================================================================
NET INCOME PER SHARE - DILUTED $ 0.93 $ 0.53 $ 1.69 $ 0.93
===============================================================================================================
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC 11,040,865 10,250,000 11,040,865 10,250,000
===============================================================================================================
WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED 11,513,865 10,306,838 11,480,664 10,306,838
===============================================================================================================
</TABLE>
4
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A.C.L.N. LIMITED
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
(UNAUDITED)
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------------
Capital Stock Paid-in Retained Cumulative Total
Capital Earnings Translation
Adjustment
Number Amount
--------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Balance December 31, 1999 8,832,692 $170,112 $20,763,972 $55,320,409 $60,853 $76,315,346
Stock split (5:4) on May 18, 2000 2,208,173 - - - - -
Net income - - 19,457,691 - 19,457,691
Cumulative translation adjustment - - - 4,530 4,530
--------------------------------------------------------------------------------------------------------------------------------
Balance June 30, 2000 11,040,865 $170,112 $20,763,972 $74,778,100 $65,383 $95,777,567
================================================================================================================================
</TABLE>
5
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A.C.L.N. LIMITED
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------------------
Six month period
ended June 30,
----------------------------------------------
(Unaudited)
2000 1999
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<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $19,457,691 $9,629,691
Adjustments to reconcile net income to net cash provided by (used in)
operating activities
Depreciation 30,504 171
Changes in assets and liabilities:
Cash restricted as to withdrawal 38,123,970 (16,006,304)
Accounts receivable (27,588,111) 21,341
Deferred expenses (447,305) (578,333)
Accounts payable and accruals 15,141,443 308,866
Amounts due to related parties (1,975) (4,703)
Income taxes payable 866,888 476,189
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NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 45,583,105 (6,073,082)
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CASH FLOWS FROM INVESTING ACTIVITIES:
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Payment of advance for vessel construction (10,000,000) --
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Purchase of fixed assets (6,000,000) (6,347)
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NET CASH USED IN INVESTING ACTIVITIES (16,000,000) (6,347)
---------------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 29,583,105 (6,079,429)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 13,944,855 11,264,950
---------------------------------------------------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $43,527,960 $5,185,521
=================================================================================================================================
SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes $ 76,967 $ --
Interest paid $ -- $ --
Interest received $298,125 $ --
=================================================================================================================================
</TABLE>
6
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A.C.L.N. LIMITED
NOTES TO FINANCIAL STATEMENTS
(INFORMATION WITH RESPECT TO JUNE 30, 2000 AND THE SIX MONTHS ENDED JUNE 30,
2000 AND 1999 IS UNAUDITED)
1. INCEPTION AND PRINCIPAL ACTIVITIES
A.C.L.N. Limited was incorporated on February 16, 1993 in Cyprus as Hemswell
Holdings Co Limited and later changed its name to A.C.L.N. Limited. It
remained dormant until January 1, 1995, when it acquired Compagnie Labiad de
Navigation S.A.M., a Company incorporated in Monaco. The principal activity
of the group is the operation of liner services for the transport of cargo.
During the year the Company commenced a new line of business of selling new
automobiles to markets in North Africa.
2. SIGNIFICANT ACCOUNTING POLICIES
UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
In the opinion of the Company's management, the consolidated balance sheet as of
June 30, 2000, the consolidated statements of operations for the three and six
months ended June 30, 1999 and 2000, the consolidated statements of cash flows
and the consolidated statement of shareholders' equity for the six months ended
June 30, 2000 contain all adjustments (consisting of only normal recurring
adjustments) necessary to present fairly the information set forth therein. The
results of operations for the three and six months ended June 30, 2000 are not
necessarily indicative of the results for any other period. These financial
statements should be read in conjunction with the Company's audited financial
statements as of and for the year ended December 31, 1999.
BASIS OF PRESENTATION
The accompanying consolidated financial statements include the accounts of ACLN
Limited and its wholly-owned subsidiary, Compagnie Labiad de Navigation S.A.M.
(collectively the Company). All significant intercompany transactions have been
eliminated. The financial statements have been prepared on the basis of
accounting principles generally accepted in the United States.
STOCK SPLIT
On May 18, 2000, the Company effected a 5 for 4 stock split of its ordinary
shares. All per share amounts have been retroactively restated to reflect the
effect of this stock split.
REVENUE RECOGNITION
The Company is a facilitator of cargo transport and a seller of automobiles,
which are shipped to destinations abroad, and sales are recorded at the time the
shipment in completed.
7
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A.C.L.N. LIMITED
NOTES TO FINANCIAL STATEMENTS
(INFORMATION WITH RESPECT TO JUNE 30, 2000 AND THE SIX MONTHS ENDED JUNE 30,
2000 AND 1999 IS UNAUDITED)
CONCENTRATIONS OF CREDIT RISK/CASH RESTRICTED AS TO WITHDRAWAL
The Company's credit risk with respect to the trade receivables arising as a
result of sales of new automobiles is evaluated on a specific customer basis and
is considered to be very low.
The Company's trade accounts receivable with respect to the liner services for
the transport of cargo are collected on its behalf by shipping agents in the
port of destination prior to the release of the automobile to the customer.
Accordingly, the credit risk from individual automobile shippers is considered
to be minimal. The shipping agents deposit the proceeds for the benefit of the
Company with the local central banking system. These amounts are classified as
Cash Restricted as to Withdrawal in the accompanying balance sheet. The funds
are transferred to the Company's bank accounts at the completion of processing
by the central banking system in accordance with local currency exchange
regulations. Cash Restricted as to Withdrawal deposited with the central banks
on behalf of the Company by country are as follows:
COUNTRY June 30, 2000 December 31, 1999
----------------------------------------------------------------------------
Angola $ 2,403,576 $ 7,608,132
Egypt 0 6,707,988
Guinea 5,234,569 13,536,832
Benin 1,948,004 1,594,867
Nigeria 1,993,812 8,708,277
Tunisia 13,926,186 25,474,021
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$25,506,147 $63,630,117
----------------------------------------------------------------------------
SEGMENTAL REPORTING
The Company has two reportable segments: operation of liner services for the
transport of cargo and selling of new cars. Required disclosure information with
respect to each segment for the three and the six months ended June 30, 2000 is
as follows:
THREE MONTHS ENDED JUNE 30, 2000:
<TABLE>
<CAPTION>
LINER SERVICES AUTOMOBILE SALES TOTAL
US$ US$ US$
<S> <C> <C> <C>
Sales 20,013,876 19,800,000 39,813,876
========== ========== ==========
Gross profit 5,940,676 6,120,000 12,060,676
========= ========= ==========
Total assets 95,917,351 19,800,000 115,717,351
========== ========== ===========
</TABLE>
8
<PAGE>
A.C.L.N. LIMITED
NOTES TO FINANCIAL STATEMENTS
(INFORMATION WITH RESPECT TO THE QUARTER AND SIX MONTHS ENDED JUNE 30, 2000
AND THE QUARTER AND SIX MONTHS ENDED JUNE 30, 1999 IS UNAUDITED)
SEGMENTAL REPORTING (CON'D)
SIX MONTHS ENDED JUNE 30, 2000:
<TABLE>
<CAPTION>
LINER SERVICES AUTOMOBILE SALES TOTAL
US$ US$ US$
<S> <C> <C> <C>
Sales 28,239,168 40,200,000 68,439,168
========== ========== ==========
Gross profit 9,745,146 12,520,000 22,265,146
========= ========== ==========
Total assets 95,917,351 19,800,000 115,717,351
========== ========== ===========
</TABLE>
Comparative information for the three and the six months ended June 30, 1999 is
not applicable because the automobile sales segment began operations in March
2000.
3. PURCHASE OF VESSEL
During the period the Company acquired M/V Emerald Bay, a second hand vessel,
which was later renamed to M/V Sea Atef, for a total purchase price of
US$6,000,000. The depreciation rate used to write-off the cost of this vessel is
6% per annum. In addition the Company has paid US$10,000,000 as an advance
towards the purchase of two more new vessels.
9
