<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ________ to __________
COMMISSION FILE NUMBER 0-23462
MY WEB INC.COM
(Exact name of Small Business Issuer as Specified in its Charter)
NEVADA 88-0207089
(State or Other Jurisdiction (IRS Employer
of Incorporation or Organization) Identification No.)
BLOCK G, UNIT 606
PHILEO DAMANSARA 1
NO. 9 JALAN 16/11
OFF JALAN DAMANSARA
46350 PETALING JAYA
SELANGOR MALAYSIA
(Address of Principal Executive Offices)
(603) 460-9282
Issuer's Telephone Number, Including Area Code
Check whether the issuer: (1) has 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 registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.
Yes X No
--- ---
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required
to be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court.
Yes X No
--- ---
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: As of August 10, 1999, the registrant
had 10,671,606 shares of Common Stock outstanding.
Transitional Small Business Disclosure Format (check one):
Yes No X
--- ---
<PAGE>
MY WEB INC.COM
FORM 10-QSB
For the Quarter Ended June 30, 1999
<TABLE>
<CAPTION>
Page
INDEX Number
<S> <C>
PART I FINANCIAL INFORMATION
Item 1 Condensed Consolidated Balance Sheets at June 30, 1999 and at December 31, 1998 3
Condensed Consolidated Statements of Operations for the three month periods
ended June 30, 1999 and June 30, 1998 and the six month periods
ended June 30, 1999 and June 30, 1998 4
Condensed Consolidated Statements of Cash Flows for the six month periods
ended June 30, 1999 and June 30, 1998 5
Notes to Condensed Consolidated Financial Statements 6
Item 2 Management's Discussion and Analysis 10
PART II
Item 1 Legal Proceedings 14
Item 2 Changes in Securities 14
Item 3 Defaults Upon Senior Securities 15
Item 4 Submission of Matters to a Vote of Security Holders 15
Item 5 Other Information 16
Item 6 Exhibits and Reports on Form 8-K 16
</TABLE>
Certain statements under the caption "Management's Discussion and Analysis" and
elsewhere in this Form 10-QSB constitute "forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
statements are typically identified by their inclusion of phrases such as "the
Company anticipates," "the Company believes" and other phrases of similar
meaning. Such forward looking statements involve known and unknown risks,
uncertainties and other factors that may cause the actual results, performance
or achievements of the company to be materially different from any future
results, performance or achievements express or implied by such forward-looking
statements. Such factors include, among others: general economic and business
conditions; competition; political changes in international markets; operating
costs; costs of capital equipment; changes in foreign currency exchange rates;
changes in business strategy or expansion plans; quality of management;
availability, terms and development of capital; fluctuating interest rates; and
other factors referenced in this Form 10-QSB.
2
<PAGE>
ITEM I. FINANCIAL STATEMENTS
MY WEB, INC.COM
(FORMERLY ASIA MEDIA COMMUNICATIONS, LTD.)
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
December
June 30 , 31, 1998
1999 (Proforma)
----------- ------------
Assets
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 3,815,517 $ 11,118
Accounts receivable, net 430,541 1,100,492
Inventories 43,338 --
Prepaid expenses and other current assets 359,163 6,176
----------- -----------
Total Current Assets 4,648,559 1,117,786
----------- -----------
Property and equipment, net 188,248 53,941
----------- -----------
$ 4,836,807 $ 1,171,727
----------- -----------
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable, trade $ 585,905 $ 419,154
Other accounts payable 288,129 355,287
Due to directors 75,162 37,271
----------- -----------
Total Current Liabilities 949,196 811,712
----------- -----------
Shareholders' Equity:
Common stock, par value $.01; authorized 100,000,000 shares; issued,
10,679,319 shares in 1999 and 8,563,069 shares in 1998; outstanding
10,671,606 shares in 1999 and 8,555,356 in 1998 106,717 85,554
Additional paid-in capital 5,558,247 885,009
Retained earnings (deficit) (1,043,576) 123,173
Currency translation adjustment (56) --
----------- -----------
4,621,332 1,093,736
Less: Treasury stock, at cost 733,721 733,721
----------- -----------
Total Shareholders' Equity 3,887,611 360,015
----------- -----------
$ 4,836,807 $ 1,171,727
=========== ===========
</TABLE>
3
<PAGE>
MY WEB, INC.COM
(FORMERLY ASIA MEDIA COMMUNICATIONS, LTD.)
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
June 30, June 30, June 30, June 30,
1999 1998 1999 1998
----------- ----------- ----------- -----------
(Pro-forma) (Pro-forma)
<S> <C> <C> <C> <C>
Revenues:
Net Sales $ 1,698,326 $ 149,534 $ 2,884,634 $ 254,996
Interest and other 33,514 -- 41,701 --
------------ ------------ ------------ ------------
Total Revenues 1,731,840 149,534 2,926,335 254,996
------------ ------------ ------------ ------------
Costs and Expenses:
Cost of sales 555,630 36,434 950,823 57,173
Sales and marketing 1,675,730 29,454 2,467,256 86,250
Product development 96,502 14,670 108,367 27,705
General administration 298,496 44,319 566,639 86,180
------------ ------------ ------------ ------------
Total Costs and
Expenses 2,626,358 124,877 4,093,085 257,308
------------ ------------ ------------ ------------
Income (Loss) before
income taxes (894,518) 24,657 (1,166,750) (2,312)
Income taxes -- -- -- --
------------ ------------ ------------ ------------
Net Income (Loss) (894,518) $ 24,657 $ (1,166,750) $ (2,312)
============ ============ ============ ============
Income (Loss) per share $ (.09) $ .00 $ (.12) $ (.00)
============ ============ ============ ============
Average number of
common shares
outstanding (post split) 10,446,189 8,555,356 9,730,773 8,555,356
============ ============ ============ ============
</TABLE>
4
<PAGE>
MY WEB, INC.COM
(FORMERLY ASIA MEDIA COMMUNICATIONS, LTD.)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
For the Six Months Ended
June 30, June 30,
1999 1998
--------- ---------
(Pro-forma)
<S> <C> <C>
Cash Flows from Operating Activities:
Net income (loss) $(1,166,750) $(2,312)
Adjustments:
Depreciation 8,684 5,967
Currency exchange - unrealized 1,450 --
Common stock issuance for
consulting services 4,400 --
Disposition of equipment 3,251 --
Shareholder debt forgiveness -- --
Working Capital Adjustments:
(Increase) Decrease in inventories (43,338) --
(Increase) Decrease in accounts
receivable, trade 670,258 (90,503)
(Increase) Decrease in prepaids
and other (352,702) --
Increase in accounts payable 112,954 61,219
----------- -----------
Cash Flows from Operating Activities (761,793) (25,629)
----------- -----------
Cash Flows from Investing Activities:
Acquisition of property and equipment (146,232) (19,444)
----------- -----------
Cash Flows from Financing Activities:
Proceeds on issuance of common stock 4,690,000 210,526
Repayments on due to directors 22,424 (157,835)
----------- -----------
Cash Flows from Financing Activities 4,712,424 52,691
----------- -----------
Increase in cash and cash equivalents 3,804,399 7,618
Cash balance, beginning 11,118 55,656
----------- -----------
Cash balance, end $ 3,815,517 $ 63,274
============== ==============
Supplementary Data:
Interest income received in operations $ 40,423 $ --
============== ==============
</TABLE>
5
<PAGE>
MY WEB, INC.COM
(FORMERLY ASIA MEDIA COMMUNICATIONS, LTD.)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1: BASIS OF PRESENTATION
The accompanying financial statements report the
consolidated accounts of My Web, Inc. com (formerly
Asia Media Communications, Ltd.) and its newly
acquired subsidiary, Tecnochannel Technologies, Sdn.,
Bhd., (a Malaysian corporation). Pursuant to the
acquisition described in Note 4 hereto, the Company
has treated the transaction as a reverse acquisition
and, accordingly, has reported the pro forma effect
in the 1998 statements in order to achieve
comparability in its operations and cash flows. The
Company was incorporated on February 20, 1985
pursuant to the laws of the State of Nevada, and
presently has its principal office located in
Malaysia, and other offices in New York, New York,
San Francisco, California and Beijing, China.
NOTE 2: UNAUDITED FINANCIAL STATEMENTS
The consolidated financial statements as of June 30,
1999, and for the periods ended June 30, 1999 and
1998, included herein are unaudited; however, such
information reflects all adjustments consisting of
normal recurring adjustments, which are, in the
opinion of management, necessary for a fair
presentation of the information for such periods. The
1998 presentation as pro-forma gives effect to the
reverse acquisition in February, 1999, in order to
provide comparability in the presentation of
operations and cash flows. In addition, the results
of operations for the interim periods are not
necessarily indicative of results for the entire
year. The accompanying financial statements are in
condensed form and should be read in conjunction with
the Company's annual report filed on Form 10-KSB.
NOTE 3: STOCK SPLIT
On February 23, 1999, the Company effected a 1 (one)
for 100 (one hundred) reverse split of its
outstanding common stock. Accordingly, the Company
reduced its common stock balance by $54,802 and
transferred the amount to additional paid-in capital.
All references to common shares are based on the post
split amounts.
6
<PAGE>
MY WEB, INC.COM
(FORMERLY ASIA MEDIA COMMUNICATIONS, LTD.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 4: ACQUISITION
On February 24, 1999, the Company acquired 100% of
the issued and outstanding capital stock of
Tecnochannel Technologies, Sdn., Bhd., a Malaysian
corporation, ("TSB"), in exchange for an aggregate of
8,500,000 shares of common stock. In connection with
such acquisition, the Company issued an aggregate of
440,000 shares of its common stock to GEM Ltd. for
its services as financial advisor to the Company.
Tecnochannel, which was formed in April, 1997 and
operates under the trade name, "My Web", has
developed with Philips Consumer Electronics set-top
boxes that enable Internet access via the television
set. The boxes are marketed and sold by Philips and
include software developed by Tecnochannel.
Approximately 18,000 of the boxes are installed in
Malaysia and Singapore. In addition, Tecnochannel has
developed and provides enabling technologies to
manufacturers and Internet service providers serving
non-personal computer devices (such as the set-top
boxes), to enhance the functionalities of such
devices. Tecnochannel also operates the My Web Online
Service which is an Internet portal providing
interactive applications, such as e-commerce, to both
personal computer users and set-top box users.
The Company accounted for the acquisition as a
purchase under a reverse acquisition procedure
whereby Tecnochannel's operations and retained
earnings are reported as continuous.
7
<PAGE>
MY WEB, INC.COM
(FORMERLY ASIA MEDIA COMMUNICATIONS, LTD.)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5: CERTAIN TRANSACTIONS
Private placement completion:
In May, 1999, the Company completed a private
placement for the sale of 526,250 shares of its
common stock with aggregate proceeds amounting to
$3,780,000. The Company intends to utilize these
funds in the future development of the business
described in the acquisition above.
Exercises of option and warrant:
In May 1999, a non-qualified stock option under the
Company's 1999 Incentive Program described in Note 7
below was granted and exercised to purchase 150,000
shares of the Company's common stock at $6.00 per
share, or an aggregate of $900,000.
In February 1999, Ocean Strategic Holdings Limited
("OSHL"), exercised its right to purchase 500,000
common stock shares at $.01 per share pursuant to a
warrant to purchase up to 1,000,000 common shares
acquired in August, 1997 for an aggregate
consideration of $50,000 in cash. On April 1, 1999,
OSHL exercised its right under such warrant to
purchase an additional 400,000 common shares at $.01
per share. As discussed in Note 7 below, on August 4,
1999, OSHL exercised its right to purchase the
remaining 100,000 shares under the warrant.
NOTE 6: COMMITMENTS AND CONTINGENCIES
Option agreement:
Pursuant to a proposed acquisition in 1996 which was
never completed, the Company had granted its then
subsidiary, AMC Holdings, an option to convert
certain preference shares in the acquisition
agreement to 125,000 shares of the Company's common
stock. The proposed acquired company executed an
agreement of forbearance whereby it was agreed to
never exercise such option. As management is
presently uncertain as to the legal binding effect of
such an agreement upon an innocent purchaser for
value, and although management believes that no
shares will be required to be issued, an aggregate of
125,000 shares are reserved in the event that the
Company may be forced to issue such shares in the
future.
8
<PAGE>
Marketing Agreement:
The Company executed a public relations consulting
agreement which has a six month term to provide such
services defined therein. The Company is charging
approximately $327,000 of advanced fee over the
agreement term. Approximately $109,000 is deferred as
of June 30, 1999 and will be charged to operations
over the two remaining months. Such fees included the
preparation of product and corporate literature, as
well as services related to media distribution.
1999 Incentive Program:
In February 1999, the Company's stockholders approved
the adoption of the Company's 1999 Incentive Program
(the "Program") pursuant to which various types of
awards may be made. The aggregate number of common
stock shares that may be issued or transferred under
the Program is 1,000,000 subject to certain
adjustments, provided that no award may be made under
the Program that would bring the total of all
outstanding awards under the Program to more than 15%
of the total number of common stock shares at the
time outstanding. An award was made and exercised in
May 1999. See Note 6 above. In addition, in May 1999,
two options were granted for 125,000 shares each, one
exercisable in May 1999 at $17.10 per share (120% of
bid price) and the second option is exercisable in
November 1999 at 120% of the then bid price. The May
1999 option has not been exercised.
1999 Non-Qualified Stock Option Plan:
In June 1999, the directors of the Company adopted
the 1999 Non-Qualified Stock Option Plan (the "Plan")
pursuant to which only non-qualified stock option may
be granted. The aggregate number of common stock
shares that may be issued or transferred under the
Plan is 1,000,000 subject to certain adjustments,
provided that no option may be granted under the plan
that would bring the total of all outstanding options
under the Plan to more than 15% of the total of
common shares at the time outstanding. As of the
current date, no options have been granted under this
Plan.
NOTE 7: SUBSEQUENT EVENT
On August 4, 1999, OSHL exercised its right to
purchase the remaining 100,000 common stock shares at
$.01 per share under a warrant to purchase up to
1,000,000 common stock shares acquired in August,
1997 for an aggregate consideration of $50,000 in
cash.
9
<PAGE>
ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS
THE FOLLOWING ANALYSIS OF THE OPERATIONS AND FINANCIAL
CONDITION OF THE COMPANY SHOULD BE READ IN CONJUNCTION WITH THE CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS, INCLUDING THE NOTES THERETO, OF THE COMPANY
CONTAINED ELSEWHERE IN THIS FORM 10-QSB.
Overview
The Company was inactive during 1998 and until February 1999,
when it acquired all of the capital stock of Tecnochannel Technologies Sdn.,
Bhd., a Malaysian corporation ("TSB").
TSB, which was formed in April, 1997 and operates under the
trade name, "My Web," has developed with Philips Consumer Electronics set-top
boxes that enable Internet access via the television set. The boxes are marketed
and sold by Philips and include software developed by TSB. Approximately 18,000
of the boxes have been installed in Malaysia and Singapore. In addition, TSB has
developed and provides enabling technologies to manufacturers and Internet
service providers serving non-personal computer devices (such as the set-top
boxes) to enhance the functionalities of such devices. TSB also operates the My
Web Online Service which is an Internet portal providing interactive
applications, such as e-commerce, to users of both personal computers (PCs) and
set-top boxes.
The Company's current business plan is to devote all of its
resources to the development and expansion of TSB's business in China and other
emerging market countries where the cost of PCs, the principal alternative
connection to the Internet, is substantially higher than the Company's set-top
boxes.
As discussed below, the three month period ended June 30, 1999
was characterized by increased revenues offset by increased expenses incurred in
connection with the Company's entry into China. The Company believes it is well
placed to capture a portion of the Internet users in China through the
deployment of the set-top boxes, as they offer easy and affordable Internet
access compared to PCs whose prices remain high relative to average income
levels. The Company has entered into strategic alliances with local Chinese
partners, i.e., manufacturers, content providers and Internet Service Providers,
for the deployment of the set-top boxes, and for MyWeb's localized portal site
in China. The Company has also embarked on an aggressive brand building strategy
in China that has resulted in an increase in expenses primarily relating to the
cost of acquiring Internet users in China and advertising and promoting the My
Web brand. The Company expects to continue to incur losses during the roll out
of its products and services in China.
10
<PAGE>
COMPARISON OF THE THREE MONTHS PERIOD ENDED JUNE 30, 1999 TO THE THREE MONTH
PERIOD ENDED JUNE 30, 1998 AND THE THREE MONTH PERIOD ENDED MARCH 31, 1999
Total Revenue
Revenues were $1,731,840, including $33,514 of interest and other income, in the
three month period ended June 30, 1999 (the "1999 Second Quarter") compared to
$1,194,409, including $8,101 of interest income, in the three month period ended
March 31, 1999 (the "1999 First Quarter"), and $149,534 in the three months
period ended June 30, 1998 (the "1998 Second Quarter"). The increase in revenues
in the 1999 Second Quarter as compared to the 1999 First Quarter was primarily
due to revenue from a software licensing agreement. The increase in revenues in
the 1999 Second Quarter as compared to the 1998 Second Quarter was primarily due
to software licensing revenue and e-commerce transactions, which commenced in
1999. No customer accounted for more than 10% of total revenues during the 1999
Second Quarter except for Net China and HKNet, which accounted for approximately
43% and 29%, respectively, of total revenues during such quarter. No customer
accounted for more than 10% of total revenues during the 1998 Second Quarter
except for Phillips Consumer Electronics (and subsidiaries thereof), which
accounted for approximately 56% of total revenues during such quarter.
Cost Of Revenue
Cost of revenues were $555,630 in the 1999 Second Quarter compared to $395,193
in the 1999 First Quarter, and $36,434 in the 1998 Second Quarter. The increase
in cost of revenue of 41% in the 1999 Second Quarter compared to the 1999 First
Quarter was due to an increase in software licensing costs. The increase in cost
of revenue of 1,425% in the 1999 Second Quarter compared to the 1998 Second
Quarter was primarily due to the cost of goods for e-commerce transactions and
the increase in software licensing costs.
Total Operating Expenses
Total operating expenses were $2,070,728 in the 1999 Second Quarter compared to
$1,055,101 in the 1999 First Quarter and $88,443 in the 1998 Second Quarter. The
increase was primarily attributable to an increase in sales and marketing
expenses to $1,675,730 in the 1999 Second Quarter from $791,526 in the 1999
First Quarter, an increase of 112%, and from $29,454 in the 1998 Second Quarter,
an increase of 5,589%.
Sales and marketing expenses consisted primarily of employee compensation, the
cost of acquiring internet users in Hong Kong and China, and advertising and
other promotion/marketing related expenses. The increase in absolute dollars
from the 1999 First Quarter and 1998 Second Quarter is primarily attributable to
an increase in personnel, the costs associated with the Company's aggressive
brand-building strategy in China and an increase in advertising and
promotion/marketing related expenses.
Product development expenses increased 713% from $11,865 in the 1999 First
Quarter to $96,502 in the 1999 Second Quarter, and increased 558% from $14,670
in the 1998 Second
11
<PAGE>
Quarter. Product development expenses consist primarily of employee compensation
relating to developing and enhancing features of the MyWeb online service
properties. The increase in absolute dollars is primarily a result of the
increase in the number of engineers responsible for the product development. The
Company has expensed, as incurred, all internal product development costs and
expects to incur increased product development costs in absolute dollars in
future periods to remain competitive.
General administration expenses increased 19% from $251,710 in the 1999 First
Quarter to $298,496 in the 1999 Second Quarter, and increased 574% from $44,319
in the 1998 Second Quarter. General administration expenses consist primarily of
employee compensation and fees for professional services, and the increase in
absolute dollars is primarily a result of an increase in personnel and increased
fees for professional services during the 1999 Second Quarter.
Net Profit (Loss)
The Company recorded a net loss of $894,518 or $0.09 per share for the 1999
Second Quarter compared to a net loss of $255,885 or $0.03 per share for the
1999 First Quarter. The increase in net loss was primarily attributable to the
increase in cost of revenues, advertising and promotion/marketing related
expenses, and investments in the Company's brand-building strategy in China.
This was offset by the increase in revenue in the 1999 Second Quarter compared
to the 1999 First Quarter.
Similarly, compared to the net profit of $24,657 in the 1998 Second Quarter, the
increase in net loss was primarily attributable to the increase in cost of
revenues, advertising and promotion/marketing related expenses, investments in
the Company's brand-building strategy in China and the roll out of MyWeb
services in China. This was offset by the increase in revenues in the 1999
Second Quarter compared to the 1998 Second Quarter.
12
<PAGE>
COMPARISON OF THE SIX MONTHS PERIOD ENDED JUNE 30, 1999 TO THE SIX MONTHS PERIOD
ENDED JUNE 30, 1998
Total Revenue
Revenues increased from $254,996 in the six months period ended June 30, 1998
(the "1998 Period") to $2,926,335 in the six month period ended June 30, 1999
(the "1999 Period"), an increase of 1,048%. This increase was attributable to
software licensing revenue and e-commerce transactions which commenced in 1999.
Two customers, Net China and HKNet, accounted for approximately 51% and 17%,
respectively, of revenues during the 1999 Period while one customer, Phillips
Consumer Electronics (and subsidiaries thereof), accounted for approximately 33%
of revenue during the 1998 Period.
Cost Of Revenue
Cost of revenue increased from $57,173 in the 1998 Period to $950,823 in the
1999 Period, an increase of 1,563%. The increase in cost of revenue was
primarily due to the cost of goods for the e-commerce transactions and software
licensing costs in the 1999 Period.
Total Operating Expenses
Total operating expenses increased 1,470% from $200,135 in the 1998 Period to
$3,142,262 in the 1999 Period. The increase was primarily attributable to an
increase in sales and marketing expenses from $86,250 in the 1998 Period to
$2,467,256 in the 1999 Period, an increase of 2,760%.
The sales and marketing expenses consists primarily of the cost of acquiring
internet users in Hong Kong and China, and advertising and other
promotion/marketing related expenses. The increase in absolute dollars from the
1998 period is primarily attributable to the costs associated with the Company's
brand-building strategy in China and an increase in advertising and
promotion/marketing related expenses.
Product development expenses increased 291% from $27,705 in the 1998 Period to
$108,367 in the 1999 Period. Product development expenses consist primarily of
employee compensation relating to developing and enhancing features of the MyWeb
online service properties. The increase in absolute dollars is primarily a
result of the increase in the number of engineers responsible for the product
development. The Company has expensed, as incurred, all internal product
development costs and expects to incur increased product development costs in
absolute dollars in future periods to remain competitive.
General administration expenses increased 558% from $86,180 in the 1998 Period
to $566,639 in the 1999 Period. General administration expenses consist
primarily of employee compensation and fees for professional services. The
increase in absolute dollars is primarily a result of an increase in personnel
and increased fees for professional services during the 1999 Period.
13
<PAGE>
Net Loss
The Company recorded a net loss of $1,166,750 or $0.12 per share for the 1999
Period compared to a net loss of $2,312 or $0.00 per share for the 1998 Period.
The increase in net loss was primarily attributable to the increase in cost of
revenues, general administration expenses, advertising and promotion/marketing
related expenses, investments in the Company's brand-building strategy in China.
This was offset by the increase in revenue in the 1999 period compared to the
1998 Period.
Liquidity and Capital Resources
At June 30, 1999, the Company had cash and cash equivalents totaling $3,815,517
compared to $63,724 at June 30, 1998. For the six months ended June 30, 1999,
cash used in operating activities of $761,793 was primarily due to the net loss
of $1,166,750 for the 1999 period.
Cash used in investing activities was $146,232 for the 1999 Period compared to
$19,444 for the 1998 Period. The capital expenditure of $146,232 for the 1999
Period consisted of the purchase of computer hardware and software, and other
office equipment.
For the 1999 Period, cash provided by financing activities of $4,712,424 was
derived primarily from the private placement of shares of common stock in the
amount of $3,780,000 and the issuance of common stock pursuant to the exercise
of a stock option in the amount of $900,000. As the Company experienced negative
cash flow from operations in the 1999 Period and anticipates that it will
continue to incur negative cash flow during the roll out of its products and
services in China, the Company may require additional capital. The sale of
additional equity or convertible debt securities, if required, may result in
additional dilution to the holders of the Company's common stock. There can be
no assurance that additional financing, if required, will be available on terms
and conditions acceptable to the Company, if available at all.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
1. On April 1, 1999, Registrant issued an aggregate of 400,000 shares
of its common stock to Ocean Strategic Holdings Limited ("OSHL") pursuant to the
exercise of a warrant acquired by OSHL in August 1997, for an aggregate
consideration of $4,000. The warrant and the shares issued upon exercise thereof
were issued in reliance upon Regulation S.
14
<PAGE>
2. In May, 1999, Registrant completed a private placement of its common
stock to 13 accredited investors. Registrant issued an aggregate 526,250 of its
common stock for aggregate cash proceeds of $3,780,000. The shares were issued
to the following investors:
<TABLE>
<CAPTION>
Number of
Name of Investor Shares Purchased Amount Invested
- -------------------------- ---------------------- --------------------
<S> <C> <C>
Tao Ying 500 $ 3,000
Alvin Granof 14,000 84,000
Jonathan A. Kaye 1,000 6,000
Ah Kee Tay 10,000 60,000
John Lim Kok Min 20,000 120,000
PT Portola Konsultindo 204,250 1,528,000
Tee-Jin Gan 50,000 420,000
Micheal Tee-Kian Gan 50,000 500,000
Soo Keok Ong 50,000 300,000
Cheah Meng Fui 77,000 462,000
Lee Wai Ping 10,000 60,000
Zhang Hui Quan 1,500 9,000
Xu Hui 38,000 228,000
</TABLE>
The foregoing issuances were deemed exempt from registration under the
Securities Act of 1933, as amended (the "Act"), in reliance on Section 4(2) of
the Act and Rule 506 of Regulation D, as transactions by an issuer not involving
any public offering. The foregoing investors represented that they were
accredited investors and that they were acquiring the shares for investment only
and not with a view to or for sale in connection with any distribution thereof.
Appropriate legends were affixed to the certificates and all investors had
adequate access to information about Registrant.
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security holders
(a) On April 7, 1999, the Company mailed an information statement to
shareholders advising them that holders of not less than 50.1% of the Company's
then outstanding shares of common stock had approved an amendment to the
Company's Articles of Incorporation to effect a change in the Company's name
from Asia Media Communications, Ltd. to My Web Inc.com. Such action was taken on
April 28, 1999.
Item 5. Other Information
None
15
<PAGE>
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27.1 Financial Data Schedule
(b) Reports on form 8-K
(i) On March 11, 1999, the Company filed a report on
Form 8-K reporting the acquisition of all of the capital stock of
Tecnochannel Tecnologies Sdn. Bhd., a Malaysian corporation, and the
related change in control.
(ii) On May 10, 1999, the Company filed a report on
Form 8-K/A containing the financial statements required in connection
with the acquisition described in item (i) above.
SIGNATURES
In accordance with 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, hereunto duly authorized.
MY WEB INC.COM
(Registrant)
By: s/s T.S. Wong
-----------------
T.S. Wong
President
Date: August 13, 1999
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