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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 2000
COMMISSION FILE NUMBER: 0-27735
ASIA 4 SALE.COM, INC.
(Exact name of registrant as specified in its charter)
STATE OF INCORPORATION OR ORGANIZATION:
NEVADA
I.R.S. EMPLOYER IDENTIFICATION NO: 77-0438927
ADDRESS OF PRINCIPAL EXECUTIVE OFFICES:
2465 West 12th Street, Suite 2
Tempe AZ 85281-6935
REGISTRANT'S TELEPHONE NUMBER:
(480) 505-0070
FORMER NAME, FORMER ADDRESS AND FORMER FISCAL YEAR, IF CHANGED SINCE
LAST REPORT:
H&L Investments Inc.
9160 East Deer Trail
Tucson, AZ 85710
INDICATE BY CHECK MARK WHETHER THE REGISTRANT HAS FILED ALL REPORTS TO
BE FILED BY SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
DURING THE PROCEEDING 12 MONTHS:
Yes [ ] No [X]
APPLICABLE ONLY TO CORPORATE ISSUERS:
INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER'S
CLASSES OF COMMON STOCK, AS OF THE LAST PRACTICABLE DATE:
10,800,000 shares of common stock, par value of $.001 per share, were
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outstanding as of March 31, 2000.
ASIA 4 SALE.COM INC.
FORM 10QSB
INDEX
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PART 1. FINANCIAL STATEMENTS
----------------------------
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
Consolidated balance sheets for December 31, 1999 and March 31, 2000
(attached).
Consolidated statements of income for three months ended March 31,
2000 (attached).
Consolidated statements of cash flow for three months ended March 31,
2000 (attached).
Notes to Consolidated Financial Statements
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATION
PART II. OTHER INFORMATION
--------------------------
ITEM 1. LEGAL PROCEEDINGS
ITEM 2. CHANGES IN SECURITIES
ITEM 3. DEFAULTS IN SECURITIES
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
ITEM 5. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
SIGNATURES
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ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
ASIA4SALE.COM INC.
Consolidated Balance Sheet
As of March 31, 2000
ASSETS
<TABLE>
<CAPTION>
CURRENT ASSETS MAR 31, DEC 31,
2000 1999
<S> <C> <C>
Cash or Cash Equivalents $ 1,776,879 16,893
Accounts Receivable 47,690 69,588
Inventory 264,460 0
------------- -------------
Total Current Assets 2,089,029 86,481
FIXED ASSETS
Computer Equipment 10,344 5,486
Office Furniture 2,617 0
Accumulated Depreciation (1,296) (115)
------------- -------------
Total Fixed (Net) Assets 11,665 5,371
OTHER ASSETS
Note Receivable 27,550 100,000
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TOTAL ASSETS $ 2,128,244 191,852
============= =============
</TABLE>
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LIABILITIES AND STOCKHOLDER'S EQUITY
<TABLE>
<S> <C> <C>
CURRENT LIABILITIES
Accounts Payable $ 6,991 8,086
Accrued Expenses 44,000 0
Commissions Payable 72,941 40,752
Notes Payable 150,000 150,000
------------- -------------
Total Current Liabilities 273,932 198,838
STOCKHOLDER'S EQUITY
COMMON STOCK: 100,000,000 SHARES
AUTHORIZED AT PAR VALUE OF $.001
PER SHARE, 10,800,000 SHARES
ISSUED AND OUTSTANDING. 10,800 10,000
Paid-In Capital in Excess of Par Value 6,989,200 4,990,000
Accumulated Deficit (5,145,688) (5,006,986)
------------- -------------
Total Stockholder's Equity 1,854,312 (6,986)
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 2,128,244 191,852
============= =============
</TABLE>
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ASIA4SALE.COM INC.
Consolidated Statements of Operations
<TABLE>
<CAPTION>
THREE MONTHS ENDING
MARCH MARCH
2000 1999
------------- -------------
<S> <C> <C>
REVENUES $ 60,446 0
Less Cost of Sales 4,907 0
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Gross Profit 55,540 0
OPERATING EXPENSES
Depreciation and Amortization 1,181 0
General & Administrative Expense 195,811 0
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Total Operating Expenses 196,992 0
INCOME (LOSS) FROM OPERATIONS (141,453) 0
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OTHER INCOME
Interest Income 2,750 0
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Total Other Income 2,750 0
NET INCOME $ (138,702) 0
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NET INCOME (LOSS) PER SHARE $ (0) 0
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WEIGHTED AVERAGE SHARES OUTSTANDING 10,275,556 1,000,000
============= =============
</TABLE>
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ASIA4SALE.COM INC.
Consolidated Statements of Cash Flow
<TABLE>
<CAPTION>
THREE MONTHS ENDING
MARCH MARCH
2000 1999
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ (138,702) 0
ADJUSTMENTS TO RECONCILE NET INCOME
TO NET CASH PROVIDED BY OPERATING
ACTIVITIES
Depreciation Expense 1,181 0
Accounts Receivable 21,[???] 0
Inventory (264,460) 0
Accounts Payable 1,095 0
Accrued Expenses 44,000 0
Commission Payable 32,189 0
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Net Cash Flow Used by Operations (304,989) 0
------------- -------------
CASH FLOWS FROM INVESTING ACTIVITIES
Computer Equipment 4,858 0
Office Furniture 2,617 0
Note Receivable 27,550 0
------------- -------------
Net Cash Used In Investing 64,975 0
============= =============
CASH FLOWS FROM FINANCING ACTIVITIES
Common Stock Issued For Cash 2,000,000 0
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Net Cash Used In Financing 2,000,000 0
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NET INCREASE (DECREASE) IN CASH $ 1,759,986 0
============== =============
Cash at Beginning of Period $ 16,893 0
Cash at End of Period 1,776,879 0
SUPPLEMENTAL CASH FLOW INFORMATION
Cash Paid For: 0 0
Interest Income Taxes 0 0
</TABLE>
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. Basis of Presentation
The consolidated balance sheet as of March 31, 2000, the consolidated
statements of income for the period ended March 31, 2000, and the
consolidated statements of cash flows for the period ended March 31, 2000
have been prepared by the Company without audit. The consolidated balance
sheet as of December 31, 1999 was derived from audited consolidated financial
statements. In the opinion of management, all adjustments (which include only
normally recurring adjustments) necessary to present fairly the financial
position, changes in income, results of operations and cash flows at
March 31, 2000(and for all periods presented) have been made.
Certain information and footnote disclosures, normally included in financial
statements prepared in accordance with generally accepted accounting
principles, have been condensed or omitted. It is suggested that these
consolidated financial statements be read in conjunction with the financial
statements and notes thereto included in the fiscal 1999 Annual Report on
Form 10-K. The results of operations for the periods ended March 31, 2000 and
March 31, 1999 (see NOTE 2.) are not indicative of the operating results for
the respective full years.
NOTE 2. Principles of consolidation.
The condensed consolidated financial statements include the accounts of Asia
4 Sale.Com Inc., Asia 4 Sale.Com Ltd. and its wholly-owned subsidiary Asia
Sales Phils. It should be noted that Asia4Sale.Com Ltd. was incorporated in
Hong Kong under the Companies Ordinance on March 24, 1999. Aside from the
statutory provision of authorized capital, as detailed in the company's
Articles of Incorporation, there was no significant business activity
conducted between the date of Incorporation and March 31, 1999.
NOTE 3. Acquisitions
On February 7, 2000, the Company acquired Asia 4 Sale.Com Ltd. in exchange
for 9,000,000 restricted common shares of Asia 4 Sale Com.Inc. Asia4Sale.Com
Ltd. is headquartered in Hong Kong and was registered and incorporated under
the Companies Ordinance of Hong Kong on March 24, 1999. Accordingly, all
financial information included herein has been restated to reflect the
combined operations of Asia 4 Sale.Com Inc., the acquired company Asia 4
Sale.Com Ltd and its wholly-owned Philippines subsidiary, Asia Sales Phils.
Inc.
NOTE 4. Inventory
Inventory is stated at cost and is comprised of 1) items acquired for resale
by auction and
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valued at $254,560 and 2) undistributed promotional items valued at $9,900.
NOTE 5. Property, Plant and Equipment
Property, plant and equipment are carried at historical cost. Accumulated
depreciation is calculated by the straight-line method.
NOTE 6. Other Assets
Other Assets consists of a short-term loan for $27,550 plus 10% interest due
and payable within 12 months. The loan has a maturity value of $30,305.
NOTE 7. Short-Term Debt
As of March 31, 2000 short-term debt consists of two promissory notes
($100,000 and $50,000 respectively) each of which is due and payable within
12 months. The Company has no other significant current liabilities.
NOTE 8. Long-Term Debt
As of March 31, 2000 the Company has no long-term debt.
NOTE 9. Shareholder's Equity
Between February 7 and March 31, 2000 the Company issued 800,000 new
restricted shares of its Common Stock at an offering price of $2.50 per
share. The proceeds of this offering are to be used to fund future
expansion, planned capital and operating expenditures and other financial
contingencies.
NOTE 10. Revenue recognition
Revenues were primarily derived from two sources: Asia 4 Sale.Com Ltd. and
its subsidiary Asia Sales Phils. Inc.
Asia 4 Sale.Com Ltd operates a network of approximately 1,000 Internet-based
storefronts, each of which function as an Asia4Sale sales agency. Asia4Sale's
revenues from these stores consists entirely of manufacturer's commissions on
goods sold. All product procurement costs, shipping costs, and sales
commissions are deducted from revenues for the purposes of calculating Gross
Profit.
Asia Sales Phils. Inc. as incorporated as a trading and investment company.
NOTE 11. Basic (Loss) Per Share
Basic (Loss) per Common Share is based on the weighted average number of
shares of
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Common Stock outstanding as of the respective dates: 10,275,556 as of
March 31, 2000 and 1,000,000 as of March 31, 1999.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATION
THE COMPANY
Asia 4 Sale.Com Inc. is the US-registered parent of Asia 4 Sale.com Ltd, a
Hong Kong registered company acquired in February, 2000. Asia4Sale.com Ltd.
was founded as a joint marketing venture between ZiaSun Technologies, Inc., a
publicly held U.S. Internet holding company and Cable & Wireless HKT, Hong
Kong's primary full-service communications provider and owner/operator of
Asia's largest commercial teleport.
Asia 4 Sale is the first major e-commerce venture to specialize in linking
Asia's producers of high quality, high value goods and services with buyers
and markets around the world. With e-commerce offerings to date dominated by
U.S. companies, the Asian emphasis allows Asia 4 Sale to offer highly
competitive prices for Asian products with strong brand recognition. Asia 4
Sale's three-part structure allows the company to exploit both the
business-to-consumer and business-to-business markets. Asia4Sale derives its
revenues from three principal sources:
ShoppingAsia (www.asia4sale.com) is an e-commerce home shopping portal
offering a variety of affiliate marketing services. ShoppingAsia makes Asian
products directly available to consumers worldwide. Any web user can open a
store, stocked with products sourced by Asia 4 Sale, at no cost to the store
operator. Asia 4 Sale's revenues from these stores consist entirely of
commissions on goods sold. ShoppingAsia is currently in the process of
introducing two new fee-based premium versions of this service which are
expected to generate substantial additional revenues.
AuctionAsia (www.auctionasia.net) provides Internet-based auction services to
businesses and consumers in the Asia region. Asia 4 Sale has also invested in
physical auction companies and sites around Asia, combining this profitable
business with its Internet auction business. Having establishing a base in
the Asian industrial auction market, AuctionAsia is expanding to exploit the
huge potential market offered by the sale of industrial-sized lots of
Asian-made components and products. AuctionAsia feels that this is a niche
with enormous growth potential; U.S. businesses, who are among the largest
consumers of Asian-made components and raw materials, are familiar with the
web auction process and will be natural customers for Asian businesses that
wish to sell in this efficient and practical way. AuctionAsia will also
continue its current strategy of investing in and providing Internet support
for physical auctions of industrial equipment throughout Asia. This business
is currently yielding solid revenues and earnings, which
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will be reinvested so as to develop the capacity to hold direct Internet
auctions of Asian-made components, raw materials, and finished goods.
BarterAsia was organized to develop and exploit the barter potential of Asian
economies. It functions as a third party record keeper for a group of
businesses that trade goods and services instead of paying cash. Barter
allows them to buy what they need and pay for it with otherwise unsold
products and services, reducing cash outflow and converting unused assets to
productive use. BarterAsia maintains an intricate barter system, achieving
the same flexibility in barter trades that is offered through traditional
cash transactions.
RESULTS OF OPERATIONS
- ---------------------
Revenues for the three months ended March 31, 2000 were $60,446. No
comparison with the corresponding period in 1999 is possible since there are
no revenues reported for this period. The increase is wholly attributable to
the acquisition of Asia 4 Sale.Com Ltd. on February 7, 2000. (See NOTES TO
CONSOLIDATED FINANCIAL STATEMENTS: NOTE 3. Acquisitions).
Gross profit for the period was $55,540 or 92% of net revenues. These high
gross margins are expected to approximate industry norms as more 'low margin'
online stores are added and the current composition of revenues changes.
Total Operating Expenses for the period were $196,992. The increase is
attributable to the acquisition of Asia 4 Sale.Com Ltd. in February, 2000.
There were no operating expenses reported for the comparable period in 1999.
Income (Loss) from Operations for the period was $(141,453). Substantial
improvement is anticipated by the end of the current fiscal year with the
introduction of two new fee-based 'premium' store services and the addition
of approximately 12,000 new 'free' stores.
FINANCIAL CONDITION, CAPITAL RESOURCES AND LIQUIDITY
- ----------------------------------------------------
As of March 31, 2000 the Company had working capital of approximately
$1.8 million. This compares with working capital of approximately $65,000 at
the end of the corresponding period in 1999. Increases in cash flow
attributable to financing activities were partially offset by decreases
attributable to operating and investing activities. The overall increase is
largely due to capital contributions made during the period ending March 31,
2000. Liquidity in future periods will be contingent upon internally
generated cash flows, the ability to obtain adequate financing for capital
expenditures and financing when needed, and the amount of increased working
capital necessary to support expected growth. Based on current
capitalization, it is believed that future cash flows from operations and the
availability of alternative sources of external financing is sufficient to
meet all anticipated requirements for planned operating and capital
expenditures and should provide adequate liquidity for the foreseeable future.
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FORWARD LOOKING STATEMENTS
- --------------------------
This Form 10-QSB contains certain forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended (the
"Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), which are intended to be covered by the safe
harbors created thereby. Investors are cautioned that all forward-looking
statements involve risks and uncertainty, including without limitation, the
ability of the Company to develop its products, as well as general market
conditions, competition and pricing. Although the Company believes that the
assumptions underlying the forward-looking statements contained herein are
reasonable, any of the assumptions could be inaccurate, and therefore, there
can be no assurance that the forward-looking statements included in this Form
10-QSB will prove to be accurate. In light of the significant uncertainties
inherent in the forward-looking statements included herein, the inclusion of
such information should not be regarded as a representation by the Company or
any other person that the objectives and plans of the Company will be achieved.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company is not party to any legal proceedings.
ITEM 2. CHANGES IN SECURITIES
ITEM 3. DEFAULTS IN SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
Not applicable.
ITEM 5 OTHER INFORMATION
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A) EXHIBITS:
Review of Public Accountant.
B) REPORTS ON FORM 8-K
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No reports on Form 8-K were filed during the quarter ended March 31, 2000.
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1934, THE REGISTRANT
HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED
THEREUNTO DULY AUTHORIZED.
JAMES EMBERTON
CHIEF FINANCIAL OFFICER
/s/ JAMES EMBERTON
- -------------------------
FOR: ASIA 4 SALE.COM INC.
(REGISTRANT)
DATE: MAY 19, 2000
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> DEC-31-1999
<CASH> 16,893
<SECURITIES> 0
<RECEIVABLES> 69,588
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 86,481
<PP&E> 5,486
<DEPRECIATION> 115
<TOTAL-ASSETS> 191,852
<CURRENT-LIABILITIES> 198,838
<BONDS> 0
0
0
<COMMON> 10,000
<OTHER-SE> (16,986)
<TOTAL-LIABILITY-AND-EQUITY> 191,852
<SALES> 70,024
<TOTAL-REVENUES> 70,024
<CGS> 1,212
<TOTAL-COSTS> 5,078,025
<OTHER-EXPENSES> (2,227)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (5,006,986)
<INCOME-TAX> 0
<INCOME-CONTINUING> (5,006,986)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (5,006,986)
<EPS-BASIC> (0.50)
<EPS-DILUTED> (0.50)
</TABLE>
