SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For The Quarter Ended March 31, 1998 Commission File No. 0-18224
Group V Corporation (formerly, NuOASIS GAMING, INC.)
(Exact name of registrant as specified in its charter)
Delaware 95-4176781
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
550 15th Street, San Francisco, California 94103
(Address of principal executive offices) (Zip Code)
(415) 575-0222
(Registrant's telephone number, including area code)
N/A N/A
(Former Address, if changed (Former Zip Code, if changed
since last report) since last report)
N/A
(Former telephone number, if changed since last report)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of1934 during the preceding 12 months (or for 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 CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's
classes of capital stock, as of the latest practicable date.
Preferred Stock $.01 par value; 170,000 shares outstanding as of May 15, 1998
Preferred Stock Series B $2.00 par value; 150,000 shares outstanding
as of May 15, 1998
Common Stock $.01 par value; 49,834,880 shares as of May 15, 1998.
<PAGE>
GROUP V CORPORATION
(formerly, NUOASIS GAMING, INC.)
INDEX
PART I
Item 1. Financial Statements
Consolidated Condensed Balance Sheet as of March 31, 1998 (unaudited).... 1
Consolidated Condensed Statements of Operations for the Three and
Nine Months Ended March 31, 1998 and 1997 (unaudited).. 2
Consolidated Condensed Statements of Cash Flows for the
Nine Months Ended March 31, 1998 and 1997 (unaudited).. 3
Notes to Consolidated Condensed Financial Statements..................... 4
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations...................................... 8
PART II
Item 1. Legal Proceedings................................................ 10
Item 2. Changes in Securities............................................ 10
Item 3. Defaults Upon Senior Securities.................................. 10
Item 4. Submission of Matters to a Vote of Security Holders.............. 10
Item 5. Other Information................................................ 10
Item 6. Exhibits and Reports on Form 8-K................................. 10
Signatures ........................................................... 11
<PAGE>
GROUP V CORPORATION
(formerly, NUOASIS GAMING, INC.)
Consolidated Condensed Balance Sheet
As of March 31, 1998 (Unaudited)
March 31,
1998
(Unaudited)
Current Assets:
Cash and cash equivalents .............................$ 291,482
Marketable securities ................................. 1,148,049
Accounts receivable.................................... 335,324
Advances............................................... 305,281
Prepaid expenses ...................................... 92,092
Total Current Assets............................. 2,172,228
Fixed assets:
Furniture and equipment......................................... 1,128,885
Less accumulated depreciation .................................. (29,931)
Total fixed assets, net....................... 1,098,954
Other assets ................................................... 10,896
TOTAL ASSETS....................................................$ 3,282,078
Current Liabilities:
Current portion of capital lease obligations ..........$ 147,711
Accounts payable....................................... 510,127
Due to affiliates ..................................... 267,878
Deferred revenue....................................... 317,439
Accrued expenses and accrued interest.................. 142,545
Total Current Liabilities..................... 1,385,700
Long Term Liabilities:
Long term capital lease obligations............................. 621,084
Notes payable .................................................. 1,200,000
Total Long Term Liabilities................... 1,821,084
Total Liabilities ..................................... 3,206,784
Commitments and Contingencies
Stockholders' Equity:
Preferred stock - par value $.01; authorized 1,000,000 shares;
14% cumulative convertible; issued and outstanding 170,000
shares (aggregate liquidation of $170,000)................... 1,700
Preferred Stock Series B - par value $2.00; authorized, issued and
outstanding 150,000 shares (aggregate liquidation of $300,000). 300,000
Common stock - par value $.01; authorized 333,000,000 shares;
49,834,880 shares issued and outstanding....................... 498,348
Additional paid-in capital....................................... 16,635,791
Stockholders' receivables........................................ (147,000)
Unrealized loss on marketable securities......................... (232,635)
Accumulated deficit.............................................. (16,980,910)
Total Stockholders' Equity.............................. 75,294
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY.......................$ 3,282,078
See accompanying notes to these consolidated condensed financial statements.
1
<PAGE>
GROUP V CORPORATION
(formerly, NUOASIS GAMING, INC.)
Consolidated Condensed Statements of Operations
For the Three and Nine Month Periods Ended March 31, 1998 and 1997 (Unaudited)
Three Months Ended Nine Months Ended
March 31, March 31,
------------------------ ----------------------
1998 1997 1998 1997
--------- --------- --------- ---------
(Unaudited) (Unaudited)(Unaudited) (Unaudited)
Revenues $ 152,761 $ -- $ 152,761 $ --
---------- ---------- --------- ----------
Costs and expenses:
Operating costs 157,103 -- 157,103 --
General and administrative 242,877 90,468 610,370 123,604
Professional services 222,789 167,099 818,139 401,910
Depreciation and amortization 14,348 13,329 36,006 13,329
Interest expense, net 5,036 63,344 43,485 63,344
Write off of excess cost over
basis of net assets acquired 37,740 -- 37,740 3,318,107
Reduction in previously written off
excess cost over basis of net
assets acquired (187,200) -- (187,200) --
---------- ---------- --------- ----------
Total costs and expenses 492,693 334,240 1,515,643 3,920,294
---------- ---------- --------- ----------
Net (loss) from
continuing operations (339,932) (334,240) (1,362,882) (3,920,294)
Net (loss) from
discontinued operations -- (49,027) -- (181,591)
---------- ---------- --------- ----------
Net (loss) $ (339,932) $ (383,267)$(1,362,882)$(4,101,885)
========== ========== ========= ==========
Net (loss) applicable to
common stock $ (345,882) $ (389,217)$(1,380,732)$(3,718,618)
========== ========== ========== ==========
Basic and diluted net (loss)
per common share $ (.01) $ (.01)$ (.03) $ (.12)
========== ========== ========== ==========
Weighted average common
shares outstanding 49,834,880 30,000,000 47,032,690 30,000,000
========== ========== ========== ==========
See accompanying notes to these consolidated condensed financial statements.
2
<PAGE>
GROUP V CORPORATION
(formerly, NUOASIS GAMING, INC.)
Consolidated Condensed Statements of Cash Flows
For the Nine Months Ended March 31, 1998 and 1997 (Unaudited)
Nine Months Ended
March 31,
--------------------------
1998 1997
----------- -----------
(Unaudited) (Unaudited)
Operating activities:
Net Loss $(1,362,883) $(4,101,885)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation and amortization 36,006 13,329
Services for stock 454,748 --
Loss on sale of securities 43,224 --
Interest on stockholder receivable (23,781) --
Write down of excess cost over basis of
net assets acquired 37,740 3,318,107
Reduction in previously written off
excess cost (187,200) --
Increase (decrease) from changes in:
Accounts receivable and advances (268,615) --
Prepaid expenses (7,091) (2,254)
Accounts payable, accrued
expenses and interest 171,939 88,463
Deferred revenue 317,439 --
Due to affiliate (45,191) 531,097
------------ -----------
Net cash used in operating activities (833,665) 153,143)
------------ ----------
Investing activities:
Proceeds from sales of securities 554,306 --
Purchase of equipment (352,598) --
Acquisitions of other assets (1,486) --
------------- ----------
Net cash provided in investing activities 200,222 --
------------- ----------
Financing activities:
Proceeds from stockholders'
receivables 247,400 121,259
Proceeds from stockholders' loans -- 37,550
------------- -----------
Net cash provided from
financing activities 247,400 158,809
------------- ----------
Net (decrease) increase in cash (386,043) 5,666
Cash and cash equivalents, beginning of period 677,525 84
------------- ----------
Cash and cash equivalents, end of period $ 291,482 $ 5,750
============= ==========
Supplemental Disclosure of Cash Flow Information:
Cash paid during the period for:
Income taxes $ 5,291 $ --
Interest $ -- $ --
Non-cash investing and financing activities:
Preferred Stock Series B converted
to common stock $ 200,000 $ --
Purchase of equipment via
assumption of capital leases $ 768,796 $ --
Purchase of NPC for Notes payable $ -- $1,200,000
Purchase of NPC for Accrued liability $ -- $ 125,000
See accompanying notes to these consolidated condensed financial statements.
3
<PAGE>
GROUP V CORPORATION
(formerly, NUOASIS GAMING, INC.)
Notes to Consolidated Condensed Financial Statements
March 31, 1998
(Unaudited)
Note 1. General
PRINCIPLES OF CONSOLIDATION
Incorporated in Delaware in 1987, Group V Corporation ("Group V") and its wholly
owned subsidiaries (collectively, the "Company" or "Registrant") are primarily
engaged in the sale and marketing of pre-paid long distance telecommunication
services and related products. Prior to the quarter ended March 31, 1998, the
Company and its wholly owned subsidiaries were engaged in gaming and investment
development activities. The activities of the Company's subsidiaries are
primarily in the United States.
The accompanying unaudited consolidated condensed financial statements include
the accounts of Group V Corporation (formerly, NuOasis Gaming, Inc.) and its
wholly owned subsidiaries. All material intercompany accounts and transactions
have been eliminated in consolidation.
In the opinion of management, the accompanying unaudited consolidated condensed
financial statements reflect all adjustments, consisting of normal recurring
accruals, necessary to present fairly the Registrant's financial position as of
March 31, 1998, and its results of operations and cash flows for the three month
and nine month periods then ended. The accompanying unaudited consolidated
condensed financial statements should be read in conjunction with the
consolidated financial statements and other information in the Company's Annual
Report on Form 10-KSB for the year ended June 30, 1997. The unaudited results of
operations for the three month and nine month periods ended March 31, 1998, are
not necessarily indicative of the operating results for the full year.
MANAGEMENT ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
CASH EQUIVALENTS
Cash equivalents are highly liquid investments with maturity of three months of
less when acquired.
FAIR VALUE OF FINANCIAL INSTRUMENTS
Statement of Financial Accounting Standards ("SFAS") No. 107 requires disclosure
about fair value for all financial instruments whether or not recognized, for
financial statement purposes. Disclosure about fair value of financial
instruments is based on pertinent information available to management as of
March 31, 1998. Considerable judgment is necessary to interpret market data and
develop estimated fair value. The Company has determined that the fair value of
all financial instruments approximated their carrying value as of March 31,
1998.
MARKETABLE SECURITIES
SFAS No. 115, "Accounting for Certain Investments in Debt and Equity
Securities", requires that management classify investments in equity securities
that have readily determinable fair values as held-to-maturity,
available-for-sale, or trading securities.
4
<PAGE>
GROUP V CORPORATION
(formerly, NUOASIS GAMING, INC.)
Notes to Consolidated Condensed Financial Statements
March 31, 1998
(Unaudited)
As of March 31, 1998, the Company owns, in the aggregate, 2,977,100 unrestricted
common shares of NuOasis Resorts, Inc "(NuOasis Resorts"). Management has
classified these equity securities as available-for-sale based on its intent to
continue to exchange the equity securities for other assets. In accordance with
SFAS No. 115, these equity securities are presented in the accompanying
consolidated condensed balance sheet as current assets at their estimated fair
market value. At March 31, 1998, the Company has an unrealized loss of $235,200,
which is based on the closing stock price of NuOasis Resorts on March 31, 1998,
and which has been accounted for as a reduction of shareholders' equity.
EQUIPMENT
Equipment is recorded at cost. Depreciation is provided using the straight-line
method over the estimated useful lives of the related assets, which are five to
ten years. Maintenance and repairs are charged to operations as incurred.
INCOME TAXES
The Company accounts for income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes," which requires the use of the "liability method"
of accounting for income taxes. Accordingly, deferred tax liabilities and assets
are determined based on the difference between the financial statement and tax
bases of assets and liabilities, using enacted tax rates in effect for the year
in which the differences are expected to reverse. Current income taxes are based
on the year's income taxable for federal and state income tax reporting
purposes.
ACCOUNTING FOR EMPLOYEE STOCK OPTIONS
In October 1995, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 123, "Accounting for Stock-based Compensation." In conformity with the
provisions of SFAS No. 123, the Company has determined that it will not change
to the fair value method presented by SFAS No. 123 and will continue to follow
Accounting Principle Board Opinion ("APB") No. 25 for measurement and
recognition of employee stock- based transactions.
ISSUANCE OF STOCK FOR SERVICES
Shares of the Company's common stock issued for services are recorded in
accordance with APB No. 16 at the fair market value of the stock issued or the
fair market value of the services provided, whichever value is more clearly
evident. The value of the services is typically stipulated by contractual
agreements. There were 1,950,000 common shares of the Company issued for
services during the nine months ended March 31, 1998.
LOSS PER COMMON SHARE
The Company has adopted the provisions of SFAS No. 128, "Earnings per Share".
Under this standard the Company is required to report basic and diluted earnings
(loss) per share. Basic loss per share is calculated by dividing the net loss
for each period, as adjusted for dividends required on preferred stock ($5,950
and $17,850 for each of the three and nine month periods, respectively, ended
March 31, 1998 and 1997), by the weighted average number of common shares
outstanding. Diluted loss per share is similar in calculation except that the
weighted average number of common shares is increased to reflect the effects of
potential additional shares that would result from the exercise of stock options
or other convertible instruments. For the three and nine month periods ended
March 31, 1998 and 1997, there is
5
<PAGE>
GROUP V CORPORATION
(formerly, NUOASIS GAMING, INC.)
Notes to Consolidated Condensed Financial Statements
March 31, 1998
(Unaudited)
no difference between basic and diluted loss
per share as the inclusion of additional potential shares is anti-dilutive due
to the net loss presented in each period.
REVENUE RECOGNITION
The Company records the sale of prepaid long distance services as current
deferred income and recognizes revenue related thereto as the service is
consumed over the useful life of the prepaid card, which is generally six months
to one year.
RECLASSIFICATION OF PRIOR YEAR AMOUNTS
To enhance comparability, the fiscal 1997 consolidated condensed financial
statements have been reclassified, where appropriate, to conform to the
financial statement presentation used in fiscal 1998.
NOTE 2. ACQUISITIONS
NATIONAL POOLS CORPORATION
On June 13, 1996, NuOasis Resorts, Inc. (formerly, Nona Morelli's II, Inc.)
("NuOasis Resorts"), the then controlling parent of Group V, granted an option
(the "Option") to Joseph Monterosso, the current President of the Company, to
acquire 250,000 Series B Preferred Shares of Group V (the "Series B Shares")
owned by NuOasis Resorts. The Option is exercisable at a price of $13 per share.
On December 19, 1996, Group V entered into Stock Purchase Agreements with each
of the shareholders of National Pools Corporation ("NPC") pursuant to which
Group V agreed to issue a series of Secured Promissory Notes (the "Notes") in
the aggregate principal amount of $1,200,000 and 1,000,000 shares of Group V's
restricted common stock to the NPC shareholders in exchange for all of the
issued and outstanding shares of capital stock of NPC. The Notes are convertible
into a maximum of 241,900,000 shares of Group V common stock. The conversion of
the Notes is contingent upon NPC's operations achieving certain financial goals
over the next several fiscal years. The terms of the conversion are, for every
$250,000 of net annual operating income achieved by NPC, $7,500 in principal
amount of the Notes may be converted in 1,511,875 shares of restricted Group V
common stock. The Notes are non-recourse to Group V, secured by the assets of
NPC, bear interest at 8% per annum, and are due and payable on May 31, 1999. As
part of this acquisition, NuOasis Resorts and Group V agreed to a debt
assumption agreement, whereby all of Group V debt in excess of $20,000 on
December 24, 1996, except for amounts owned to certain affiliates, which have
been converted into shares of Group V common stock, was assumed by NuOasis
Resorts. The NPC Stock Purchase Agreements closed on December 24, 1996.
On June 13, 1997, Mr. Monterosso exercised the Option to purchase 128,041 Series
B Shares, at $13 per share, by payment to NuOasis Resorts of
approximately$1,665,000. The 128,041 Series B Shares acquired may be immediately
converted into 8,987,198 shares of restricted Group V common stock. Additionally
on June 13,1997, Group V sold its wholly owned subsidiary, CMA, to NuOasis
Resorts for cash of $1,140,000, notes receivable from NPC aggregating $245,836,
and a credit against the NuOasis Resorts intercompany account of $95,000.
On August 22, 1997, and effective June 13, 1997, the Option was amended (the
"Amended Option") to increase the exercise price for 21,959 of the Series B
Shares from $13 per share to $72.20 per share, or approximately $1,585,000 for
the 21, 959 shares of Series B Preferred Stock. The option to purchase the
remaining 100,000 shares of Series B shares was terminated. Concurrently,
NuOasis Resorts granted Mr. Monterosso a new option to purchase the remaining
100,000 Series B Shares at an exercise price of
6
<PAGE>
GROUP V CORPORATION
(formerly, NUOASIS GAMING, INC.)
Notes to Consolidated Condensed Financial Statements
March 31, 1998
(Unaudited)
$11.70 per share. Additionally,
as consideration for granting the new option, NuOasis Resorts acquired the right
to require Mr. Monterosso to purchase all or any remaining unexercised shares of
the 100,000 Series B Shares in its entirety by September 1, 1998.
Closing on September 2, 1997, but effective June 30, 1997, Mr. Monterosso
exercised the Amended Option to purchase 21,959 Series B Shares, at $72.20 per
share, by payment to NuOasis Resorts of approximately$1,585,000. The 21,959
Series B Shares acquired may be immediately converted into 1,712,803 shares of
restricted Group V common stock. Concurrent with the exercise of the Amended
Option, Group V released NuOasis Resorts from liability, if any, arising from
any events while NuOasis Resorts controlled Group, in exchange for
approximately$1,585,000 of marketable securities ("Marketable Securities").
Subsequent to June 30, 1997, the Marketable Securities have been delivered from
escrow and, accordingly, the consideration received by the Company has been
presented in the accompanying unaudited consolidated condensed balance sheet as
marketable securities. Additionally, such consideration has been accounted for
as a capital contribution.
On September 2, 1997, NuOasis Resorts sold to Mr. Monterosso 6,000,000 New Class
D Warrants in consideration for a $1,800,000 promissory note secured by the New
Class D Warrants, due in September 1998. Each New Class D Warrant is exercisable
at $1 per share and entitles Mr. Monterosso to receive, upon exercise, two
shares of common stock, or a total of 12,000,000 common shares if all the New
Class D Warrants have been exercised.
On September 2, 1997, NuOasis Resorts granted to Mr. Monterosso an option to
purchase 7,800,000 common shares of the Company exercisable at $0.15 per share
after NuOasis Resorts converted its remaining 100,000 shares of Series B
Preferred Stock into 7,800,000 common shares.
On January 20, 1998, the Company agreed with NuOasis Resorts to exchange the
Marketable Securities for cash payment of $441,801, 3,600,000 unrestricted
common shares of NuOasis Resorts, the offset of $392,748 in shareholder
receivables from affiliates of NuOasis Resorts, and the offset of certain
payments due to NuOasis Resorts by Mr. Monterosso. Mr. Monterosso has placed
certain marketable securities in escrow to secure the payments offset on his
behalf.
As a result of the Company's acquisition of NPC and the sales and purchases of
the Series B Preferred Stock, as discussed above, a change in control of the
Registrant has occurred and the Registrant is now no longer a controlled
subsidiary of NuOasis Resorts.
UNIVERSAL NETWORK SERVICES, INC.
In September 1997, the Company agreed in principle to acquire a 50% convertible
net profits interest ("Net Profits Interest") in Universal Network Services,
Inc. ("UNSI"). NPC's Chief Operating Officer is a shareholder and officer of
UNSI. The Net Profits Interest will provide the Company with up to 50% of UNSI's
net operating profit and grant the Company the option to convert its Net Profits
Interest into and equity interest of up to 100% of UNSI's issued and outstanding
common stock. During the quarter ended March 31, 1998, the Company abandoned its
acquisition of the Net Profits Interest in UNSI and recorded $22,500 in related
professional services expense.
MAGNET TELECOM, INC.
In October 1997, the Company agreed in principle to purchase a fifty percent net
profits interest in MagNet Telecom, Inc. ("MTI") a privately held
telecommunications network marketing company and
7
<PAGE>
GROUP V CORPORATION
(formerly, NUOASIS GAMING, INC.)
Notes to Consolidated Condensed Financial Statements
March 31, 1998
(Unaudited)
an affiliate of UNSI. During
the quarter ended March 31, 1998, the Company abandoned its acquisition of an
interest in MTI and recorded $19,066 in related general and administrative
expense.
LOTTOWORLD, INC.
Also in October 1997, the Company and Lottoworld, Inc. agreed in principle to
form a new joint venture company whereby Lottoworld will assign all of its
publishing assets, including the Lottoworld Magazine, to the new joint venture
company. As of the date of this report no agreements have been finalized.
ARK-TEL ASSET ACQUISITION
On May 15, 1998, and effective March 1, 1998, the Company acquired the telephone
switching and platform assets and office equipment (the "Ark-Tel Assets") of
Ark-Tel, Inc., a wholly owned subsidiary of UNSI, for total consideration of
$323,940 in cash and the assumption of certain equipment leases. The leases
expire over various periods through April 2003.
Based upon the lease terms, management has classified certain of the leases as
capital leases and recorded $768,796 in related capital lease obligations.
Management has estimated the fair market value of the Ark-Tel Assets at
$1,054.996. The excess of the total consideration paid over the fair market
value of the assets, $37,740, was recorded as goodwill and charged to expense
during the quarter ended March 31, 1998. Management intends to continue to
review its estimates regarding the assets acquired and may record adjustments
thereto in the final quarter of the fiscal year.
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONSLIQUIDITY AND CAPITAL RESOURCES
The Registrant has incurred net losses and negative cash flows from operating
activities since its inception in 1988. The Registrant had cash and cash
equivalents of approximately $291,482 and $677,525 as of March 31, 1998, and
June 30, 1997, respectively, and working capital of $786,528 and $1,926,180 as
of March 31, 1998, and June 30, 1997, respectively. The decrease in working
capital is a direct result of cash used for operating activities. As of the date
of this Report, the Registrant has no material commitments for capital
expenditures.
Prior to the acquisition of NPC and sale of CMA, the Registrant received
financial support from NuOasis Resorts, and was dependent upon NuOasis Resorts
for future working capital. NuOasis Resorts is no longer a controlling parent
and will no longer fund the Registrant. The Registrant's plan is to continue
searching for additional sources of equity and working capital and new operating
opportunities. In the interim, the Registrant's existence is dependent upon the
success of NPC's HitLoTTo(TM) product, which has only recently begun to be
marketed. The Registrant may need to utilize its working capital of $786,528 at
March 31, 1998, and continue to utilize its common stock to support its
financial obligations until sales of the HitLoTTo(TM) product reach profitable
levels, if any. The Registrant is also pursuing other joint venture, merger or
acquisition opportunities, which may provide additional capital resources during
fiscal 1998.
ACQUISITIONS
During the quarter ended March 31, 1998, the Company terminated its agreements
in principle with UNSI and MTI and acquired certain assets of an UNSI subsidiary
(see Note 2 of the footnotes to accompanying unaudited consolidated condensed
financial statements included elsewhere herein at Item 1).
8
<PAGE>
GROUP V CORPORATION
(formerly, NUOASIS GAMING, INC.)
Notes to Consolidated Condensed Financial Statements
March 31, 1998
(Unaudited)
RESULTS OF OPERATIONS
COMPARISON OF THE THREE MONTHS ENDED MARCH 31, 1998 TO THE THREE MONTHS ENDED
MARCH 31, 1997
As a result of the acquisition of the Ark-Tel assets effective March 1, 1998,
the Company reported revenues of $ 152,761 compared to no revenues in the same
period last year.
Total general and administrative expenses increased by $152,409 or 168% during
the quarter ended March 31, 1998, compared to the same period last year, as the
Company began to staff its newly formed operating subsidiaries.
Professional services increased by $55,690 or 33% during the current quarter
compared to the same period last year due to the increased services of
attorneys, accountants and other advisors relating to acquisitions (see Note 2
of the footnotes to accompanying unaudited consolidated condensed financial
statements included elsewhere herein at Item 1).
Net interest expense decreased by $58,307 during the current quarter resulting
from the retirement of NPC pre-acquisition debt, interest on shareholder
receivables, and interest earnings on the Company's money market bank accounts.
COMPARISON OF THE NINE MONTHS ENDED MARCH 31, 1998, TO THE NINE MONTHS ENDED
MARCH 31, 1997
As a result of the acquisition of the Ark-Tel assets effective March 1, 1998,
the Company reported revenues of $ 152,761 compared to no revenues in the same
period last year.
Total general and administrative expenses increased by $486,766 or 394% during
the nine months ended March 31, 1998, compared to the same period last year,
primarily due to the inclusion of activities of NPC for the full current period
compared to three months of the comparable prior period. Additionally, during
the final month of the current period, the Company began to staff its new
operations.
Professional services increased by $416,229 or 104% compared to the same period
last year due to the increased services of attorneys, accountants and other
advisors relating to (see Note 2 of the footnotes to accompanying unaudited
consolidated condensed financial statements included elsewhere herein at Item
1).
Depreciation and amortization expense increased by $22,677 during the period
resulting directly from the acquisition of depreciable assets of NPC and the
Ark-Tel Assets.
Net interest expense decreased by $19,859 during the period resulting from the
retirement of NPC pre-acquisition debt, interest on shareholder receivables, and
interest earnings on the Company's money market bank accounts.
Cash used in operating activities increased to $833,665 for the nine months
ended March 31, 1998, from $153,143 for the same period last year, which was
primarily attributable to the acquisition of NPC (discussed above). Cash
provided by financing activities of $247,400 for the nine months ended March 31,
1998, decreased from $158,809 for the same period last year, due to the
collection of previously unrecorded receivables from NPC shareholders, resulting
in a $187,200 reduction in amounts previously written off As excess cost over
basis of net assets acquired.
9
<PAGE>
GROUP V CORPORATION
(formerly, NUOASIS GAMING, INC.)
Notes to Consolidated Condensed Financial Statements
March 31, 1998
(Unaudited)
PART II: OTHER INFORMATION
Item 1. Legal Proceedings
On December 12, 1997, the Company received notice of a law suit filed by John D.
Desbrow, former Officer and Director, against the Company for past services
allegedly due in the amount of approximately $13,000.
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
EXHIBIT NO. DESCRIPTION
27 Financial Data Schedule
10
<PAGE>
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.
GROUP V CORPORATION (formerly, NUOASIS GAMING, INC.)
Dated: May 29, 1998 By: /S/ JOSEPH MONTEROSSO
Joseph Monterosso, President and Chairman
Dated: May 29, 1998 By: /S/ DENNIS D. HOUSTON
Dennis D. Houston, Director
11
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1998
<PERIOD-END> MAR-31-1998
<CASH> 291,482
<SECURITIES> 1,148,049
<RECEIVABLES> 335,324
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,172,228
<PP&E> 1,128,885
<DEPRECIATION> (29,931)
<TOTAL-ASSETS> 3,282,078
<CURRENT-LIABILITIES> 1,385,700
<BONDS> 0
0
301,700
<COMMON> 498,348
<OTHER-SE> (875,342)
<TOTAL-LIABILITY-AND-EQUITY> 3,282,078
<SALES> 152,761
<TOTAL-REVENUES> 152,761
<CGS> 157,103
<TOTAL-COSTS> 157,103
<OTHER-EXPENSES> 330,554
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 5,036
<INCOME-PRETAX> (339,932)
<INCOME-TAX> 0
<INCOME-CONTINUING> (339,932)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (339,932)
<EPS-PRIMARY> (.01)
<EPS-DILUTED> (.01)
</TABLE>
