U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] Quarterly report under Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended June 30, 2000
[ ] Transition report under Section 13 or 15(d) of the Exchange Act OF 1934
For the transition period from _________________ to ____________________.
Commission file number 333-18439
MOBILE AREA NETWORKS, INC.
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(Exact Name of Small Business User as Specified in its Charter)
FLORIDA 59-3482752
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(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization Identification No.)
1275 LAKE HEATHROW LANE, SUITE 115, HEATHROW, FLORIDA 32746
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(Address of Principal Executive Offices) (Zip Code)
407-333-2350
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(Issuer's telephone Number, including area code)
Check whether the issuer: (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes [X] No [ ]
Shares of Common Stock outstanding at June 30, 2000 - 33,514,353
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MOBILE AREA NETWORKS, INC.
INDEX
PAGE
NUMBER
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets
June 30, 2000 (Unaudited)
and December 31, 1999 2
Statements of Operations
Three and six months ended
June 30, 2000 (Unaudited) and
June 30, 1999 (Unaudited) 3
Statements of Cash Flows
Six months ended
June 30, 2000 (Unaudited) and
June 30, 1999 (Unaudited) 4
Notes to Financial Statements (Unaudited) 5
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations 6
PART II. OTHER INFORMATION 7
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MOBILE AREA NETWORKS, INC.
(A Development Stage Company)
BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
JUNE 30,
DECEMBER 31, 2000
1999 (UNAUDITED)
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<S> <C> <C>
Current assets:
Cash $ 216,185 62,899
Inventory 23,947 25,792
Other current assets 5,671 23,503
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Total current assets 245,803 112,194
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Property and equipment, net 132,347 135,672
Intangible assets, net of accumulated amortization of
$9,150 and $10,674
6,108 4,584
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$ 384,258 252,450
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 15,771 11,558
Accrued expenses 240,000 243,763
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Total current liabilities 255,771 255,321
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Stockholders' equity:
Common stock, no par value, authorized 50,000,000 shares,
issued and outstanding 33,486,035 and 33,514,353 shares 1,742,541 1,868,679
Deficit accumulated during the development stage (1,614,054) (1,871,550)
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Total stockholders' equity 128,487 (2,871)
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$ 384,258 252,450
=========== ===========
</TABLE>
See accompanying notes to financial statements.
2
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MOBILE AREA NETWORKS, INC.
(A Development Stage Company)
STATEMENTS OF OPERATIONS
Three and six months ended June 30, 2000 and 1999
(unaudited)
<TABLE>
<CAPTION>
THREE MONTHS THREE MONTHS SIX MONTHS SIX MONTHS
ENDED ENDED ENDED ENDED
JUNE 30, 2000 JUNE 30, 1999 JUNE 30, 2000 JUNE 30, 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues $ 48,492 8,253 80,642 20,661
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Cost and expenses:
Product development and marketing 118,837 87,947 219,790 158,273
General and administrative 51,045 69,723 118,348 127,281
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Total costs and expenses 169,882 157,670 338,138 285,554
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Interest income -- -- -- --
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Net loss $ (121,390) (149,417) (257,496) (264,893)
=========== =========== =========== ===========
Weighted average shares outstanding 33,511,903 33,242,509 33,500,194 33,164,302
=========== =========== =========== ===========
Net loss per share $ (0.004) (0.004) (0.008) (0.008)
=========== =========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
3
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MOBILE AREA NETWORKS, INC.
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
For the six months ended June 30, 2000 and 1999
(Unaudited)
<TABLE>
<CAPTION>
SIX MONTHS SIX MONTHS
ENDED ENDED
JUNE 30, 2000 JUNE 30, 1999
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<S> <C> <C>
Cash flows from operating activities:
Net loss $(257,496) (264,893)
Adjustments to reconcile net loss to net cash used
Depreciation and amortization 20,524 9,812
Change in operating assets and liabilities:
Accounts payable (4,213) (50,837)
Accrued expenses 3,763 43,218
Inventory (1,845) (1,307)
Other current assets (17,832) (4,142)
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Net cash used in operating activities (257,099) (268,149)
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Cash flows from investing activities:
Purchase of property and equipment (22,325) (39,645)
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Net cash used in investing activities (22,325) (39,645)
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Cash flows from financing activities:
Proceeds from issuance of common stock 130,903 388,830
Stock issuance cost (4,765) (8,516)
Proceeds from issuance of note payable -- --
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Net cash provided by financing activities 126,138 380,314
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Net increase (decrease) in cash (153,286) 72,520
Cash at beginning of period 216,185 54,971
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Cash at end of period $ 62,899 127,491
========= =========
Supplemental disclosure of cash flow information
Cash paid for:
Taxes $ -- --
========= =========
Interest $ -- --
========= =========
</TABLE>
See accompanying notes to financial statements.
4
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MOBILE AREA NETWORKS, INC.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
(1) PRESENTATION OF UNAUDITED FINANCIAL STATEMENTS
The unaudited financial statements have been prepared in accordance with
rules of the Securities and Exchange Commission and, therefore, do not
include all information and footnotes necessary for a fair presentation of
financial position, results of operations and cash flows, in conformity
with generally accepted accounting principles. The information furnished,
in the opinion of management, reflects all adjustments (consisting only of
normal recurring accruals) necessary to present fairly the financial
position as of June 30, 2000 and results of operations and cash flows for
three and six month periods ended June 30, 2000 and 1999. The results of
operations are not necessarily indicative of results which may be expected
for any other interim period, or for the year as a whole.
(2) REVENUE RECOGNITION
The Company recognizes revenue upon shipment of product and upon provision
of related consulting and installation services.
(3) INVENTORIES
Inventories at June 30, 2000 and December 31, 1999 consist of finished
products and equipment.
(4) REGISTRATION OF SECURITIES
On February 16, 1999 the Company's registration statement covering the
registration of 5,000,000 shares of common stock was declared effective by
the United States Securities and Exchange Commission. Provisions of the
registration statement include a maximum offering price of $6.00 per unit
resulting in maximum gross proceeds of $30,000,000.
The Securities are being sold on a best efforts, no minimum amount basis.
The offering will expire nine months after the effective date unless
updated or terminated sooner. The proceeds from the offering will be used
primarily to fund the deployment of its communications network
infrastructure.
5
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
Working capital amounted to $(143,127) at June 30, 2000 compared to
$(9,968) at December 31, 1999. Cash amounted to $62,899 at June 30, 2000,
as compared to $216,185 at December 31, 1999. As more fully described under
the Company's statements of cash flows in the accompanying financial
statements, net cash used in operating activities for the six months ended
June 30, 2000 and 1999 was $(257,099) and $(268,149), respectively,
primarily as a result of the Company's net losses. For the six months ended
June 30, 2000 and 1999, cash was provided primarily by additional stock
issuances. During the six months ended June 30, 2000 and 1999, cash was
used in investing activities to acquire additional property and equipment.
As indicated herein, the Company's short term liquidity needs have been
satisfied primarily from the continuing sale of Company stock.
RESULTS OF OPERATIONS
The Company's operations to date have been devoted primarily to product
development and marketing, raising capital and administrative activities.
However, revenues through June 30, 2000 increased substantially over the
same period in 1999. For the six months ended June 30, 2000, product
development and marketing expenses have increased approximately 38% over
the corresponding period of the prior year as the Company's products are
now more aggressively marketed and sold to an increasing customer base. As
expected, general and administrative expenses have decreased over this
period as a percentage of total costs and expenses. Management's primary
goal for the remainder of 2000 is to focus on providing increased
consulting services and consummating product sales and service agreements
with the Company's customer base.
Operations for the six months ended June 30, 2000 resulted in a net loss of
$257,496 as compared to a net loss of $264,893 for the corresponding period
of the prior year. Since inception, the Company has incurred research and
development costs equal to approximately 50% of total product development
and marketing costs.
6
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PART II - OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS: None
Item 2. CHANGES IN SECURITIES: None
Item 3. DEFAULTS UPON SENIOR SECURITIES: None
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS: None
Item 5. OTHER INFORMATION: None
Item 6. Exhibits and Reports on Form 8-K:
(a) Exhibits:
27 Financial Data Schedule (SEC use only)
(b) During the quarter ended June 30, 2000 no report on Form 8-K
was filed or required to be filed.
7
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereto duly authorized.
MOBILE AREA NETWORKS INC.
AUGUST 13, 2000 /s/ GEORGE WIMBISH
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Date George Wimbish
Director, Chairman and President
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EXHIBIT LIST
EXHIBIT
NUMBER DESCRIPTION
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27 Financial Data Schedule (for SEC use only)
