<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended September 30, 2000
[ ] Transition Report pursuant to 13 or 15(d) of the Securities Exchange Act
of 1934
For the transition period ____________ to ____________
Commission File Number 0-29219
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POKER.COM INC.
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(Exact name of small Business Issuer as specified in its charter)
Florida 98-0199508
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(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
Suite 201-1166 Alberni Street V6E 3Z3
Vancouver British Columbia
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(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: 604-689-5998
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(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the issuer was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days [X] Yes [ ] No
State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date: 16,905,000 Common Shares of $.001 par
value Class A Common Stock outstanding as of September 30, 2000.
<PAGE>
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
The accompanying unaudited financial statements have been prepared in accordance
with the instructions to Form 10-QSB and Item 310 (b) of Regulation S-B, and,
therefore, do not include all information and footnotes necessary for a complete
presentation of financial position, results of operations, cash flows, and
stockholders" equity in conformity with generally accepted accounting
principles. In the opinion of management, all adjustments considered necessary
for a fair presentation of the results of operations and financial position have
been included and all such adjustments are of a normal recurring nature.
Operating results for the three months ended September 30, 2000 are not
necessarily indicative of the results that can be expected for the year ending
December 30, 2000.
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POKER.COM, INC.
FINANCIAL STATEMENTS
September 30, 2000
(Unaudited)
(Stated in U.S. Dollars)
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POKER.COM, INC.
(Formerly Thermal Ablation Technologies Corporation)
(A Development Stage Company)
Consolidated Financial Statements
September 30, 2000 and December 31, 1999
(U.S. Dollars)
(Unaudited)
INDEX Page
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Consolidated Financial Statements
Consolidated Balance Sheets 1
Consolidated Statements of Operations 2
Consolidated Statements of Stockholders' Equity 3
Consolidated Statements of Cash Flows 4
Notes to Consolidated Financial Statements 5
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POKER.COM, INC.
(Formerly Thermal Ablation Technologies Corporation)
(A Development Stage Company)
Consolidated Balance Sheets
(U.S. Dollars)
(Unaudited)
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September 30, December 31,
2000 1999
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Assets
Current
Cash $ 79,226 $ 41,132
Accounts receivable 341,933 99,405
Prepaid expenses 16,667 2,635
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Total Current Assets 437,826 143,172
Long-Term Receivable 150,000 150,000
Property and Equipment 21,417 100,822
Intangible Assets 217,965 222,812
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Total Assets $ 827,208 $ 616,806
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Liabilities
Current
Accounts payable and accrued liabilities $ 318,652 $ 195,527
Advances from related parties 5,004 95,927
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Total Liabilities 323,656 291,454
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Stockholders' Equity
Preferred Stock, $0.01 par value, 5,000,000
shares authorized, no shares issued and
outstanding
Common Stock and Paid-In Capital in Excess
of $0.01 Par Value
100,000,000 Shares authorized
16,905,000 (December 31, 1999 - 14,100,000)
shares issued and outstanding 1,445,000 510,000
Subscriptions Received 0 500,000
Other Comprehensive Income (Loss) 5,877 (14,130)
Deficit Accumulated During the Development Stage (947,325) (670,518)
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Total Stockholders' Equity 503,552 325,352
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Total Liabilities and Stockholders' Equity $ 827,208 $ 616,806
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See notes to consolidated financial statements. 1
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POKER.COM, INC.
(Formerly Thermal Ablation Technologies Corporation)
(A Development Stage Company)
Consolidated Statements of Operations for Period From Inception to
September 30, 2000
(U.S. Dollars)
(Unaudited)
<TABLE>
<CAPTION>
============================================================================================================================
Period from
May 3, 1989
(Inception)
Through
Three Months Ended September 30, Nine Months Ended September 30, September 30,
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2000 1999 2000 1999 2000
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<S> <C> <C> <C> <C> <C>
Revenues
Marketing $ 166,477 $ 0 $ 741,322 $ 0 $ 791,602
Miscellaneous 0 30 3,000 71 4,014
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Total Revenues 166,477 30 744,322 71 795,616
Cost of Goods Sold 17,141 0 111,464 0 139,257
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Gross Margin 149,336 30 632,858 71 656,359
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Expenses
Website marketing (2,777) 5,716 337,325 5,716 473,898
General corporate
expenses and recovery 8,079 8,000 73,702 8,000 85,074
Corporation promotion 36,628 1 149,060 714 190,274
Office supplies and services 33,445 259 116,775 3,902 148,174
Management and consulting fees 22,072 10,000 63,073 32,573 178,327
Professional fees 14,246 12,372 36,259 15,771 153,683
Rent (949) 0 13,577 14,228 46,138
Investment written off 0 0 0 140,297 140,297
Compensation expense 0 0 0 0 125,000
Depreciation and amortization 53,070 0 119,894 0 127,819
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Total Expenses 163,814 36,348 909,665 221,201 1,668,684
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Loss from Operations (14,478) (36,318) (276,807) (221,130) (1,012,325)
Gain on Sale of Asset 0 65,000 0 65,000 65,000
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Net Loss for Period $ (14,478) $ 28,682 $ (276,807) $ (156,130) $ (947,325)
============================================================================================================================
Net Loss Per Share $0.000 $0.002 $0.018 $0.012
============================================================================================================================
Weighted Average Number of
Common Shares Outstanding 15,860,217 12,811,956 15,655,548 12,532,968
============================================================================================================================
</TABLE>
See notes to consolidated financial statements. 2
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POKER.COM, INC.
(Formerly Thermal Ablation Technologies Corporation)
(A Development Stage Company)
Consolidated Statements of Stockholders' Equity
(U.S. Dollars)
(Unaudited)
<TABLE>
<CAPTION>
==================================================================================================================
Period from
May 3, 1989
Nine Months (Inception)
Ended Year Ended Through
September 30, December 31, September 30,
2000 1999 2000
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<S> <C> <C> <C>
Shares of Common Stock Issued
Balance, beginning of period 14,100,000 12,000,000 0
Issued for
Services 0 750,000 3,750,000
Settlement of debt 225,000 0 225,000
Cash 1,080,000 0 10,080,000
Subscriptions previously received 1,500,000 600,000 2,100,000
Intangible assets 0 750,000 750,000
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Balance, end of period 16,905,000 14,100,000 16,905,000
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Common Stock and Paid-In Capital In Excess of Par
Balance, beginning of period $ 510,000 $ 160,000 $ 0
Issued for
Services 0 125,000 135,000
Settlement of debt 175,000 0 175,000
Cash 260,000 0 410,000
Subscriptions previously received 500,000 100,000 600,000
Intangible assets 0 125,000 125,000
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Balance, end of period $ 1,445,000 $ 510,000 $ 1,445,000
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Subscriptions Received
Balance, beginning of period $ 500,000 $ 100,000 $ 600,000
Issued for subscriptions received (500,000) (100,000) (600,000)
Subscriptions received 0 500,000 0
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Balance, end of period $ 0 $ 500,000 $ 0
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Other Comprehensive Income (Loss)
Balance, beginning of period $ (14,130) $ 0 $ 0
Foreign currency translation gain (loss) 20,007 (14,130) 5,877
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Balance, end of period $ 5,877 $ (14,130) $ 5,877
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Deficit Accumulated During Development Stage
Balance, beginning of period $ (670,518) $ (158,931) $ 0
Net loss for period (276,807) (511,587) (947,325)
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Balance, end of period $ (947,325) $ (670,518) $ (947,325)
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Total Stockholders' Equity $ 503,552 $ 325,352 $ 503,552
==================================================================================================================
</TABLE>
See notes to consolidated financial statements. 3
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POKER.COM, INC.
(Formerly Thermal Ablation Technologies Corporation)
(A Development Stage Company)
Consolidated Statements of Cash Flows
(U.S. Dollars)
(Unaudited)
<TABLE>
<CAPTION>
===============================================================================================================
Period from
May 3, 1989
(Inception)
Through
Nine Months Ended September 30, September 30,
2000 1999 2000
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<S> <C> <C> <C>
Operating Activities
Net loss $ (276,807) $ (156,130) $ (947,325)
Adjustments to reconcile net loss to
net cash used by operating activities
Depreciation and amortization 119,894 0 127,819
Compensation expense 0 0 125,000
Write-down of investment 0 140,297 140,297
Changes in non-cash working capital (49,357) 210,579 (9,943)
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Net Cash Used By Operating Activities (206,270) 194,746 (564,152)
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Investing Activities
Acquisition of investment 0 (50,000) (140,297)
Purchase of property, equipment
and intangible assets (35,643) (127,440) (242,202)
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Net Cash Used By Investing Activities (35,643) (177,440) (382,499)
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Financing Activities
Proceeds from issuance of common
stock 0 0 260,000
Subscriptions received 260,000 0 860,000
Reduction of subscriptions received
by issuance of shares 0 0 (100,000)
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Net Cash Provided By Financing Activities 260,000 0 1,020,000
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Effect of Foreign Currency Translation on Cash 20,007 (2,776) 5,877
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Inflow of Cash 38,094 14,530 79,226
Cash, Beginning of Period 41,132 5,898 0
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Cash, End of Period $ 79,226 $ 20,428 $ 79,226
===============================================================================================================
Supplemental Disclosure of Non-Cash Transactions
Reduction of subscriptions previously received
by issuance of shares $ 360,000 $ (100,000) $ (600,000)
Issue of common shares for settlement of debt $ 175,000 $ 0 $ 175,000
Issue of common stock for intangible assets $ 0 $ 0 $ 250,000
===============================================================================================================
</TABLE>
See notes to consolidated financial statements. 4
<PAGE>
POKER.COM, INC.
(Formerly Thermal Ablation Technologies Corporation)
(A Development Stage Company)
Notes to Consolidated Financial Statements
Three Month and Nine Month Period Ended September 30, 2000
(U.S. Dollars)
(Unaudited)
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1. BASIS OF PRESENTATION
These unaudited financial statements have been prepared in accordance with
generally accepted accounting principles in the United States for interim
financial information. These financial statements are condensed and do not
include all disclosures required for annual financial statements. The
organization and business of the Company, accounting policies followed by
the Company and other information are contained in the notes to the
Company's audited consolidated financial statements filed as part of the
Company's December 31, 1999 Form 10-SB.
In the opinion of the Company's management, these financial statements
reflect all adjustments necessary to present fairly the Company's
consolidated financial position at September 30, 2000 and the consolidated
results of operations and the consolidated statement of cash flows for the
three months and nine months then ended. The results of operations for the
three months and nine months ended September 30, 2000 are not necessarily
indicative of the results to be expected for the entire fiscal year.
2. STOCK SPLIT
On August 16, 2000, the Company split its stock on a 3 for 1 basis. All of
the shares and per share amounts presented in these financial statements
are as if the stock split had occurred prior to the beginning of the
periods presented.
5
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ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
(All figures are in thousands of US dollars)
The Company's much anticipated Poker software is expected to be released in
early October 2000. Due to this rescheduling the expected sales have been
delayed. The delivery of the new software program will allow the sales
department to increase revenues from the sale of new Poker card room licenses.
The company is also negotiating with Starnet Systems International Inc. to
acquire licensing rights to resell the Starnet system software. The Starnet
software will provide the company with the ability to sell a Sports Book and a
full suite of state of the art Casino games in both Java script and in a
downloadable format. If an agreement can be completed by the end of October
2000, the first sub-license utilizing the Starnet systems should be ready for
operation by November 2000.
Revenues from banner advertising have been gradually increasing and are expected
to continue to generate increased revenues in the fourth quarter.
The company is currently working on the redesign of the company's online portal.
Improved traffic will result in increased revenues from both advertising in
casino and card room sales.
Resignations of Directors
None
RESULTS OF CONTINUING OPERATIONS
The following table sets forth for the periods indicated selected information
from Poker.com's consolidated statement of operations:
<TABLE>
<CAPTION>
Three Months Three Months
Ended Sept 30, Ended Sept 30,
2000 1999
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(IN THOUSANDS)
<S> <C> <C>
Net Sales 166 0
Gross Margin 149 0
Operating Expenses 164 36
Income (loss) from continuing (14) (36)
operations
Net (loss) Income (14) 29
</TABLE>
<PAGE>
Liquidity and Capital Resources.
Three-month period ended September 30, 2000 and 1999.
NET SALES. Net sales for the three-months ended September 30, 2000 were $166
compared to $0 for the three-months ended September 30, 1999 as the Company had
just begun operations at that time. Sub-license revenues were $7, banner
advertising revenues were $90 and royalty fees were $69 for the three months
ended September 30, 2000 respectively.
The Company believes that royalty revenues from casinos and the new Poker card
room software will substantially improve the gross revenues for the next
quarter. These are forward-looking statements, particularly as related to the
business plan of the company, within the meaning of Section 27A of the
Securities Act of 1993 and Sections 21E of the Securities Exchange Act of 1934
and are subject to the safe harbor created by these sections. Actual results may
differ materially from the company's expectations and estimates.
GROSS MARGIN. Gross margin was 90% of net sales for the three months ended
September 30, 2000. Management believes the margin is consistent with licensing
and marketing of turnkey Internet gaming systems. Poker.com's gross margin may
be affected by several factors including (i) the mix of revenue streams, (ii)
the price of products sold and (iii) other components of cost of sales.
OPERATING EXPENSES. Operating expenses were $164 and $36 for the three-month
period ended September 30, 2000 and 1999 respectively and $910 and $221 for the
nine-month period ended September 30, 2000 and 1999, respectively. The increase
in the 2000 periods is mainly due to website marketing and corporate promotion
that was consistent with Poker's aggressive marketing campaign.
DEPRECIATION AND AMORTIZATION EXPENSE. Depreciation and amortization expense
was $53 and $0 for the three-month period ended September 30, 2000 and 1999
respectively and $120 and $0 for the nine-month periods ended September 30, 2000
and 1999, respectively. The increase in expenses for the three-month period
ended September 30, 2000 is due to an accelerated write down of $46 for casino
software the Company believes to be obsolete.
PROVISION FOR INCOME TAXES. No tax provision was made for the three-month
period ended September 30, 2000. The Company, at December 31, 1999 has available
a net operating loss carry forward of approximately $400 that may be used to
offset future United States federal taxable income. The net operating loss carry
forward if not utilized will begin to expire in 2018.
<PAGE>
FINANCIAL CONDITION AND LIQUIDITY
LIQUIDITY AND CAPITAL RESOURCES. At September 30, 2000 the Company had cash and
cash equivalents totaling $79 compared to $61 at June 30, 1999. Poker.com's
principal source of liquidity is $79 in cash and cash equivalents.
Approximately $206 of the $342 accounts receivable and long term receivable was
due from Antico Holdings S.A. for the purchase of a Poker sub-license and
royalty fees. The amount due from Antico Holdings for their License fee is
payable in equal installments over a period of three years. Antico Holdings has
assigned to Poker.com Inc the 15% credit card hold back which started to be
released on a monthly basis, which began July 15th 2000.
Net cash (used) by operating activities for the nine-month period ended
September 30, 2000 was ($206). The decrease in cash was mainly due to increase
in accounts receivable of $99 to $342 from December 31, 2000. This is due to
royalty revenue, banner advertising and sale of casino license fees being
accrued.
Net cash (used) for investing activities for the six-month period ended
September 30, 2000 was ($36). The cash was used for the purchase of additional
capital assets and casino software.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
360,000 unissued common shares were issued
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
Exhibit No. Description
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27 Financial Data Schedule
(b) Reports on Form 8-K
None.
<PAGE>
Signatures
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In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
Poker.com Inc
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(Registrant)
Date 9 Nov 2000 /s/ M. Jackson
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(Signature)* Secretary
Date 9 Nov 2000 /s/ C. Taylor
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(Signature)*
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* Print the name and title of each signing officer under his signatures.
Form 10-QSB
13
