WEB NEWS Liquidity Requirements
Our need to raise additional equity or debt financing and our ability to generate cash flow from operations
will depend on for the purchase of our products and our ability to expand to new markets outside of the PRC. If our working capital is insufficient to fund the implementation of our business plan we will be required to seek additional financing sooner than currently anticipated in order to proceed with our business goals. In the event that we need additional capital and are unable to obtain it, we could be left without sufficient liquidity.
Comments & Business Outlook
Three Months Ended September 30,
Six Months Ended September 30,
2011
2010
2011
2010
Revenue, net
$
1,375,229
$
2,897,549
$
6,940,017
$
5,832,446
Cost of revenue (inclusive of depreciation)
1,191,928
1,949,142
5,091,921
3,879,212
Gross profit
183,301
948,407
1,848,096
1,953,234
Operating expenses:
Sales and marketing
191,674
179,250
629,212
341,398
General and administrative
945,806
507,251
1,632,153
768,031
Total operating expenses
1,137,480
686,501
2,261,365
1,109,429
(Loss) income from operations
(954,179)
261,906
(413,269)
843,805
Other income (expense):
Interest income
337
247
530
372
Interest expense
(38,406)
(8,675)
(96,728)
(89,497)
Subsidy income
-
-
-
73,504
Loss on extinguishment of debt
-
-
(440,000)
Total other expense, net
(38,069)
(8,428)
(96,198)
(455,621)
(Loss) income before income taxes
(992,248)
253,478
(509,467)
388,184
Income tax benefit (expense)
37,326
49,729
(61,337)
(116,438)
Net (loss) income
(954,922)
303,207
(570,804)
271,746
Dividend on preferred stock
23,161
15,600
43,803
23,100
Net (loss) income attributable to common stockholders
(978,083)
287,607
(614,607)
248,646
Other comprehensive income:
Foreign currency translation gain
24,237
15,666
84,243
21,347
Comprehensive (loss) income
$
(953,846)
$
303,273
$
(530,364)
$
269,993
Net (loss) income per share – Basic
$
(0.02)
$
0.00
$
(0.01)
$
0.00
Net (loss) income per share – Diluted
$
(0.02)
$
0.00
$
(0.01)
$
0.00
Weighted average common stock outstanding – Basic
63,755,057
59,553,379
63,755,057
59,366,712
Weighted average common stock outstanding – Diluted
63,755,057
78,403,925
63,755,057
76,492,629
Deal Flow
On August 26, 2011 , the Registrant sold a total of 714,285 shares of Series AAA Convertible Preferred Stock (the
“ Shares
” ) in a private offering. The Shares were sold for cash for an offering price of $0.35 per Share, and there were no underwriting discounts or commissions. The total consideration received by the Registrant for sale of the shares was $250,000
Comments & Business Outlook
Agrisolar Solutions, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)
For The Three Months Ended June 30, 2011 and 2010
(Unaudited)
2011
2010
Revenue, net
$
5,564,788
$
2,934,897
Cost of revenue (inclusive of depreciation)
3,899,993
1,921,468
Gross profit
1,664,795
1,013,429
Operating expenses:
Sales and marketing
437,538
170,750
General and administrative
686,347
260,780
Total operating expenses
1,123,885
431,530
Income from operations
540,910
581,899
Other income (expense):
Subsidy income
-
73,504
Interest income
193
125
Interest expense
(58,322)
(80,822)
Loss on extinguishment of debt
-
(440,000)
Total other expense, net
(58,129)
(447,193)
Income before income taxes
482,781
134,706
Income tax expense
98,663
166,167
Net income (loss)
384,118
(31,461)
Dividend on preferred stock
20,642
7,500
Net income (loss) attributable to common stockholders
363,476
(38,961)
Other comprehensive income:
- Foreign currency translation gain
60,006
5,681
Comprehensive income (loss)
$
423,482
$
(33,280)
Net income (loss) per share – Basic
$
0.01
$
(0.00)
Net income (loss) per share – Diluted
$
0.00
$
(0.00)
Weighted average common stock outstanding – Basic
63,755,057
59,180,046
Weighted average common stock outstanding – Diluted
83,541,119
59,180,046
Comments & Business Outlook
Results For the Fourth Quarter
Revenue for three months ended December 31, 2010 was $1,790,117 , as compared to revenue of $1,051,093 for three months ended December 31, 2009, an increase of $739,024 (70.3%).
During the year ended March 31, 2010, three models of our line of solar insect killers were approved by the Ministry of Agriculture of the People’s Republic of China (“PRC”) and successfully became items which are subsidized by the PRC government, thus the sales amount increased significantly. Moreover, we employed more sales agent to promote our products in different provinces that have approved our products. The PRC government has extended the program under which the Company’s products have been approved for subsidy until 2020.
As of December 31, 2010, we had working capital of $3,120,396 as compared to a working capital deficit of $200,578 at March 31, 2010. The improved working capital results from an increase in sales activity in the nine month period ended December 31, 2010.
We anticipate that we will require additional working capital for various purposes, including payment of expenses associated with production and sale of our line of solar insect killer under the subsidy program of the PRC Ministry of Agriculture. Based on initial purchase plan estimates received, management is expecting significant orders of its solar insect killer in 2011 and beyond. The expenses associated with a rapid increase in production include purchase of raw materials, payment of costs associated with hiring additional staff, and payment of costs associated with an increase in inventory. We also intend to use working capital to improve the efficiency of the our production line and to pay marketing and development costs related to seeking to establish distribution channels for our products in markets outside of China, including particularly the US and South America.
Liquidity Requirements
We anticipate Based on initial purchase plan estimates received from 26 provinces, management is expecting significant orders of its solar insect killer in 2010 and beyond . The expenses associated with a rapid increase in production include purchase of raw materials, payment of costs associated with hiring additional staff, and payment of costs associated with an increase in inventory. We also intend to use working capital to improve the efficiency of the our production line and to pay marketing and development costs related to seeking to establish distribution channels for our products in markets outside of China, including particularly the US and South America.
The Company does not currently have any commitments to obtain working capital. However, we believe that the Company’s best option for raising working capital is through an equity offering and sale of our equity securities .
Deal Flow
We are currently offering subscriptions of Series AA Preferred Stock up to a maximum of 17,142,857 shares at a price of $0.35 per share, on a “best efforts” basis . The Series AA Preferred Stock has a stated value of $0.35 per share and is entitled to one vote for each share held. The holders of AA Series Preferred Stock also are entitled to an annual dividend rate of 4% and payable in cash, semi-annually, in arrears. In the event of liquidation, the holders of AA Series Preferred Stock are entitled to a preference of $0.35 per share, in cash, equal to 100% of the stated value for each share outstanding, plus an amount equal to all accrued but unpaid dividends thereon, whether or not declared. At the option of the holders, AA Series Preferred Stock will be converted into one (1) common stock of the Company and one-half (1/2) warrant to purchase an additional share of common stock at a price of $0.7 per share in a period of 5 years, together with the payment of all accrued but unpaid dividends in the form of common stock at a price of $0.35 per share.
Reverse Merger Activity
Fuwaysun was formed via a reverse merger with Agrisolar Solutions, completed on January 8, 2010
Company Snap Shot : Fuwaysun is primarily engaged in the development, production and sale of solar products.
The audited consolidated financial statements of Fuwaysun are not currently available . Such financial statements will be filed not later than March 26, 2010 by amendment to this Current Report on Form 8-K.
Post Merger Share Calculation :
298,397: Pre reverse merger outstanding shares
58,055,000: Newly issued shares of Common Stock
GeoTeam® best effort calculation of total post reverse merger outstanding shares assuming full conversions: 58,353,397
Source: 8K January 8, 2010
