SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.
FORM 6-K
Report of Foreign Issuer
Pursuant to Rule 13a- 16 or 15d-16 of the
Securities Exchange Act of 1934
3rd Quarter Financials ending June 30, 1999
Alexa Ventures Inc.
818 Erie St.
Stratford, ON
N4Z 1A2
[Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F]
Form 20-F |X| Form 40-F |_|
[Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information by the
Commission pursuant to Rule 12g3-2(b) under the Securities Act of 1934.]
Yes |X| No |_|
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, thereunto duly authorized.
Alexa Ventures Inc.
Date: August 25, 1999 Mr. Gerry A. Racicot
President
<PAGE>
MANAGEMENT REVIEW
- --------------------------------------------------------------------------------
STRATFORD, ONTARIO, CANADA, AUGUST 1999--Gerry Racicot, President of Alexa
Ventures Inc., (ALEXA), a leading computer and energy-efficiency electronic
products company, reported continued growth and plans to further consolidate its
structure by incorporating its Lexatec subsidiary into the Eiger Labs operation
on completion of the acquisition.
"Once again, Alexa Ventures Inc. is pleased to announce continued financial
capital growth and implementation of its growth strategy through careful
acquisition," said Racicot.
On July 10, 1999, Alexa entered into a letter of intent to purchase 64% of Eiger
Labs Inc. and 64% of its manufacturing company Point Multimedia Systems Inc.
Eiger Labs is a distributor of fax/modems Ethernet, PNA and MP3 players in the
USA, operating out of the Silicon Valley. Point Multimedia Systems (POINT) is
based in South Korea and is a circuit board assembler and distributor of
electronic products. Point manufactures fax/modems, PNA, PCMCIA and other
products for both Eiger and Point to distribute in South Korea.
"Eiger is #2 in the US PCMCIA modem retail market with a 14 % market share and
strong relationships with major retailers including Comp USA, Best Buy, Computer
City, Ingram-Micro, Micro Centre & others," said Racicot.
"Overall sales decreased during the quarter from $16,413,000 to $7,426,000 due
to the re-organization of Lexatec VR Systems, Inc., and by the elimination of
lower margin high risk sales. It is anticipated that Lexatec's revenue will be
enhanced by the Eiger aquisition,with more profitable revenue growth being
expected to ensue in the future months. Net loss for the period of $66,000 vis a
vis a profit of $71,000 recognizes the cost of raising capital and the lack of
business being done prior to the equity financing and the consequence of the
lack of capital.
"The balance sheet has been strengthened with cash increasing by $2,050,000, the
inventory and accounts receivable reducing by $3,296,000, the debt has reduced
by $4,546,000, share capital increasing by $5,000,000 and shareholder equity
increased to 8,033,000 from 2,674,000 " continued Racicot.
K-Troniks International Corp. (K-Tronik) is enjoying increased sales with
monthly sales increases resulting in a profit of $25,000 in June. Sales are
expected to increase substantially over the next 12 months.
"Alexa has never been stronger, both financially and operationally. We look
forward to a future growth and prosperity from our diligence and hard work,"
concluded Racicot.
ALEXA VENTURES INC.
G.A. Racicot K. Attoe, C.A.
Chief Executive Officer Chief Financial Officer
<PAGE>
Alexa Ventures Inc.
Unaudited Consolidated Balance Sheet
June 30 1999 1998
- --------------------------------------------------------------------------------
Assets
Current
Cash 2,050,000
Accounts Receivable 2,007,000 4,131,000
Inventories 2,619,000 3,791,000
Prepaid Expenses 78,000 105,000
Due from Related Party 24,000 18,000
----------- -----------
6,778,000 8,045,000
Capital (Net of Amortiaztion) 2,543,000 2,550,000
Long - Term Investments 2,368,000 342,000
Other 630,000 419,000
----------- -----------
12,319,000 11,356,000
- --------------------------------------------------------------------------------
Liabilities and Shareholder's Equity
Current
Bank Loan 1,235,000 660,000
Accounts Payable and Accrued Liabilities 1,224,000 5,382,000
Current Portion of lease obligation 48,000 107,000
Current Portion of Long Term Debt 87,000 87,000
Provision for Income Taxes (171,000) 55,000
----------- -----------
2,423,000 6,291,000
----------- -----------
Long Term
Obligation under capital lease 17,000 41,000
Long - Term Debt 1,504,000 2,172,000
----------- -----------
1,521,000 2,213,000
----------- -----------
Deferred Income Taxes 176,000 143,000
----------- -----------
Non - controlling Interest 166,000 35,000
Shareholder's Equity
Share Capital 7,176,000 2,176,000
Contributed Surplus 642,000 264,000
Retained Earnings 215,000 234,000
----------- -----------
8,033,000 2,674,000
----------- -----------
12,319,000 11,356,000
<PAGE>
Alexa Ventures Inc.
Unaudited Statement of Consolidated Operations and Retained Earings
For the nine months ended June 30
1999 1998
- --------------------------------------------------------------------------------
Sales 7,426,000 16,413,000
Cost of Sales
Work in Process, beginning 40,000 46,000
Cost of Goods Manufactured 5,821,000 14,623,000
----------- -----------
5,861,000 14,669,000
Work in Process, end 40,000 46,000
----------- -----------
Cost of Sales 5,821,000 14,623,000
----------- -----------
Gross Margin 1,605,000 1,790,000
Administrative Expenses 1,968,000 1,652,000
----------- -----------
Net Income (loss) for the period (363,000) 138,000
Provision for Income Taxes (171,000) 55,000
----------- -----------
Net Income for the Period (192,000) 83,000
Non-controlling Interest (126,000) 12,000
----------- -----------
Net Income for the Period (66,000) 71,000
Retained Earnings, Beginning of Year 247,000 163,000
Prior Period Adjustment 35,000
Retained Earings, End of Year 215,000 234,000
=========== ===========
<PAGE>
Alexa Ventures Inc.
Unaudited Statement of Consolidated Changes in Financial Position
<TABLE>
<CAPTION>
For the nine months ended June 30
1999 1998
- ---------------------------------------------------------------------------------------
<S> <C> <C>
Cash provided by (used in)
Operating Activities
Net Income (loss) for the period (66,000) 71,000
Items not involving cash Amortization 159,000 104,000
---------- ----------
93,000 175,000
Changes in non-cash working capital balances
Accounts Receivable 86,000 (3,357,000)
Inventories 603,000 (1,947,000)
Prepaid Expenses (35,000) (80,000)
Accounts payable and accrued (1,138,000) 4,861,000
Other 0 110,000
Non-controlling Interest (126,000) 109,000
Provision for Income Taxes (218,000) 55,000
---------- ----------
Total Cash provided by (used in) operating activities (735,000) (74,000)
---------- ----------
Investment Activities
Purchase of Capital Assets (840,000) (652,000)
Purchase of Long Term Investment (1,157,000) (150,000)
---------- ----------
(1,997,000) (802,000)
---------- ----------
Financing Activities
Lease Obligation (55,000) (80,000)
Increase in Long-Term Debt (96,000) 965,000
Common Shares Issued 5,000,000 47,000
---------- ----------
4,849,000 932,000
---------- ----------
Increase (decrease) in cash during period 2,117,000 56,000
Bank indebtedness,beginning (1,302,000) (716,000)
---------- ----------
Bank indebtedness,end 815,000 660,000)
=======================================================================================
Represented by
Bank Loan 815,000 (660,000)
---------- ----------
815,000 (660,000)
</TABLE>
<PAGE>
Alexa Ventures Inc.
Supplementary Information
As at June 30, 1999
Schedule A:
Financial Information - see unaudited consolidated financial statements
Schedule B:
#1 - See attached schedule of Administrative Expenses
- During the period, the company has had transactions with directors and
other related parties. The
#2 a) Options Exercised - October 1st to December 31,1998
- Nil
- January 1st to March 31, 1999
- Nil
- April 1st, 1999 to June 30, 1999
- Nil
#2 b) Options Granted - October 1st to December 31,1998
- Nil
- January 1st to March 31, 1999
- Nil
- April 1st to June 30, 1999
- Nil
#3 a) 18,815,001 shares issued and outstanding
#3 b) Outstanding Options:
NAME # OF SHARES PRICE EXPIRY DATE
Ken Rampersad 50,000 .55 05/01/00
Keith Attoe 50,000 .60 09/08/00
Keith Attoe 100,000 .90 11/11/00
Walter Keyser 50,000 .70 09/30/00
Beverly Boorsma 15,000 .85 11/07/00
James E. Lalonde 50,000 .85 09/17/99
Ken Rampersad 50,000 .85 04/17/00
Keith Attoe 100,000 .85 04/17/00
Dingerman Kleppe 30,000 .85 04/17/00
Walter Keyser 100,000 .85 04/17/00
Robert Kim 200,000 .60 04/02/01
Steve Kim 50,000 .60 04/02/01
Robert Kim 350,000 .60 04/02/01
Cheon Hong Kim 25,000 .80 06/25/00
Robert Hoegler 25,000 .75 05/01/00
#3 c) Total number of shares in escrow - nil
#3 d) List of Directors
Gerry Racicot Walter Keyser
Robert Hoegler Keith Attoe
Ernest Kolenda Morden C. Lazarus
Sidney Harkema
<PAGE>
Alexa Ventures Inc.
Unaudited Schedule of Consolidated Administrative Expenses
For the nine months ended June 30, 1999 1999 1998
- ------------------------------------------- ---------- ----------
Selling salaries and benefits 40,153 71,054
Administration salaries and benefits 21,653 21,932
Engineering salaries and benefits 76,368 73,776
Consulting fees 78,967 145,777
Professional fees 53,954 1,020,638
Bad debts 14,950 34,000
Interest and bank charges 165,910 147,070
Office supplies 8,674 10,425
Telephone 12,064 15,437
Advertising and promotion 6,000 10,312
Lex. Administrative Expense 460,922 --
K-T Administrative Expense 939,697 --
Business taxes -- 24,750
Amortization of goodwill and
organizational costs 26,873 5,636
Miscellaneous 4,843 2,488
Filing fees 20,600 15,117
Relocation -- 12,701
Repairs and Maintenance 1,442 1,972
Exchange losses(gains) (1,532) (12,694)
Capital tax 12,962 28,042
Building Amort 23,526 23,526
---------- ----------
1,968,027 1,651,959
<PAGE>
ALEXA VENTURES INC.
NOTES to the FINANCIAL STATEMENTS
June 30, 1999
Reconciliation to U.S. GAAP:
Relevant difference between accounting principles generally accepted in Canada
("Cdn. GAAP") compared to those principles generally accepted in the United
States of America ("U.S. GAAP") are as follows:
1) Product development costs, which may be capitalized and amortized under
Cdn GAAP, are to be expensed as incurred under U.S. GAAP;
2) Negotiated loan reduction, added to contributed surplus under Cdn.
GAAP, is to be treated as income under U.S. GAAP.
Following is a reconciliation which summarizes the effects of the differences
discussed above.
1999 1998
---- ----
$ $
Net Income per Cdn.GAAP (66,000) 71,000
Net Income Per U.S. GAAP (66,000) 71,000
Retained Earnings ( Deficit)
End of Quarter per Cdn. GAAP 215,000 234,000
Negotiated Loan Reduction 424,000 --
Adjustment re Depreciable Life of
Computer Equipment (30,000) (30,000)
Defeffed Tax Adjustment 12,000 12,000
Retained Earnings (Deficit)
End of Period per U.S. GAAP 621,000 216,000
----------- -----------
Total Assets per Cdn. GAPP 12,319,000 11,356,000
Adjustments re Depreciable Life of
Computer Equipment (30,000) (30,000)
Deferred Tax Adjustments 12,000 12,000
Total Assets per U.S. GAAP 12,301,000 11,338,000
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