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ACCY revoked :
http://www.sec.gov/litigation/admin/2011/34-63689.pdf
Sept 16, 2008
Form 8-K for ALTERNATIVE CONSTRUCTION TECHNOLOGIES, INC.
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16-Sep-2008
Change in Directors or Principal Officers, Financial
ITEM 5.02DEPARTURE OF CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.
On September 11, 2008, Thomas Dawe, a designee to the Board of BridgePointe Master Fund Ltd., CAMOFI Master LDC and CAMHZN Master LDC (the "Lenders") pursuant to agreements entered into between the Lenders and the Company in May 2008, resigned from the Board of Directors
Sept 11, 2008
Alternative Construction Technologies, Inc. (ACCY.OB)
Summary
Income Statement Get Income Statement for:
View: Annual Data | Quarterly Data All numbers in thousands
PERIOD ENDING 30-Jun-08 31-Mar-08 31-Dec-07 30-Sep-07
Total Revenue 1,511 2,554 3,942 3,297
Cost of Revenue 1,282 2,004 2,205 2,508
Gross Profit 228 551 1,737 789
Operating Expenses
Research Development - - - -
Selling General and Administrative 2,001 545 656 546
Non Recurring - - - -
Others - - - -
Total Operating Expenses - - - -
Operating Income or Loss (1,772) 6 1,080 243
Income from Continuing Operations
Total Other Income/Expenses Net (125) (117) (142) (213)
Earnings Before Interest And Taxes (1,903) (111) 938 29
Interest Expense - - - (86)
Income Before Tax (1,903) (111) 938 115
Income Tax Expense - - - -
Minority Interest (10) 4 (73) (18)
Net Income From Continuing Ops (1,907) (107) 865 97
Non-recurring Events
Discontinued Operations - - - -
Extraordinary Items - - - -
Effect Of Accounting Changes - - - -
Other Items - - - -
Net Income (1,907) (107) 865 97
Preferred Stock And Other Adjustments - - - -
Net Income Applicable To Common Shares ($1,907) ($107) $865 $97
Sept 11, 2008 A DAY WE WILL ALWAYS REMEMBER ( TOGETHER WE STAND )
Alternative Construction Technologies Signs Exclusive Supplier Agreement for Its ACTech Structural Insulated Panels With Alvarez Construction Group of Florida
Thursday September 11, 9:58 am ET
Alvarez Construction to Build Energy Efficient and Disaster Resistant SHIP Homes, Affordable Housing and Low Cost Communities for Elderly and Retirees On Fixed Budgets
MELBOURNE, Fla., Sept. 11, 2008 (GLOBE NEWSWIRE) -- Alternative Construction Technologies, Inc. (OTC BB:ACCY.OB - News) announced today that it has entered into an exclusive supplier agreement with Alvarez Construction Group, Inc. of Florida. Alvarez Construction Group (ACG) is an emerging developer and an ``on-site'' builder of SHIP (State Housing Initiative Partnership) homes, ``custom'' affordable housing and low cost communities for elderly and retirees on fixed budgets. ACG is a design build firm that can also provide custom commercial and/or residential general contractor services, subcontractor services or developer services. Alvarez Construction Group has contracted to use the Alternative Construction Technologies' (ACT) ACTech(r) Panel system exclusively as its structural wall and roof components in all of its non-lumber and non-block construction jobs.
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Joint marketing efforts will address many of the challenges faced by governments and consumers with various types of ``affordable'' housing needs in the Northern and Eastern coastal regions of Florida, where potential severe weather phenomena and daily or seasonal vacillations in temperature exist. The resulting benefits are that those who are forced to live under difficult budgetary constraints can enjoy confidence in the safety and security of their dwelling while also realizing significant monthly savings in utility, maintenance, and insurance expenses. Alvarez Construction Group aims to provide energy efficient and weather resilient buildings that are Class-1 fire rated and present excellent energy efficiency that often result in up to 70% less in monthly energy expenses. The constructed homes are expected to receive LEED (Leadership in Energy and Environmental Design), Florida Green Building Coalition, EnergyStar and/ or Florida BuildSmart certifications and may also provide eligibility for certain property insurance discounts of between 12-70% in Florida.
Alvarez Construction Group is a growing company in the state of Florida licensed to provide development services, underground work, and general contracting. Alvarez Construction will also offer its buildings in combination with solar and other sustainable technology options.
Mike Alvarez, CEO for Alvarez Construction, stated, ``In seeking to be compliant with FEMA projectile testing and provide superior energy efficiency ratings, we believe that Alvarez Construction's ambition and expertise together with the ACTech(r) Panel system will offer an unprecedented building solution for the elderly and those in need of affordable housing. If we go beyond the disaster and energy efficient capabilities and offer renewable energy and water technologies, we feel we can provide state-of-the-art occupancy in affordable and sustainable buildings for the budget minded.''
``Alvarez Construction supports our belief that the market is moving towards lower cost green building and sustainable construction solutions,'' commented A.J. Francel, Chief Executive Officer for Alternative Construction Technologies, Mr. Francel further added, ``We expect that this will be the first of many partnerships designed to achieve that goal.''
Alternative Construction Technologies, Inc. (ACT) possesses a unique and patented construction technology called the ACTech(r) Panel System that is used in the design and erection of state-of-the-art ``green'' buildings in commercial, residential, industrial, military, pre-engineered and modular building applications, as well as patented safe rooms. Generically known as structural insulated panel (SIP), ACT's revolutionary and efficient construction solution utilizes an inherently better ``next generation'', galvanized steel ``skin'' SIP system to complete energy efficient, stronger, safer, faster, Class-1 fire rated and more economical structures than conventional wood and brick based building products or first generation SIP products. The patented ACTech(r) Panel is environmentally-friendly and easier to construct with - not only saving labor cost and cutting construction time, but also reducing recurring monthly heating and cooling energy bills consistently by 30-50% and often as much as 70%. Very importantly, the ACTech(r) Panel possesses disaster resistant strength and has tested stronger than conventional concrete block or wood frame construction. In combination with FEMA compliant hurricane projectile tests, the ACTech(r) Panel continues to meet the most stringent wind, projectile and uplift codes in the nation levied by the 2006 Florida Building Code. The ACTech(r) Panel System offers builders and consumers many competitive and comparative advantages of use due to its wide range of attributes. As severe weather phenomenon continues to intensify, needs for more energy efficient buildings amplify, this new construction technology gains awareness, or hurricane and tornado-prone states establish new building codes and rebuild from recent weather disasters, ACT believes its products will be in greater demand. ACT has recently added ancillary services, including design, consulting and construction through its various general contracting subsidiaries. When specifying the ACTech(r) Panel System as the ``green'' structural building material into any construction application, it is most probable that a LEED (Leadership in Energy & Environmental Design), Florida Green Building Coalition, FP&L (NYSE:FPL - News) BuildSmart and/or Energy Star rating will be readily achieved.
State Housing Initiative Program (SHIP): This program is designed to provide financial assistance to very-low, low and moderate income applicants/households to acquire their first home that will be used as their principal place of residence. Financial assistance will be provided in the form of a mortgage which is due upon sale, transfer or conveyance of the property. If the loan conditions are not violated at the end of 30 years, the loan is forgiven. The State's fiscal year for the SHIP Program begins on July 1, 2008 and it ends June 30, 2009. SHIP funding makes homeownership affordable for prospective very-low, low and moderate income first time home buyers. Funds may be used as gap financing to buy down purchase price, rehabilitate existing property (expending no more than $5,000) and/or closing costs.
This press release may contain forward-looking statements covered within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to, among other things, plans and timing for the introduction or enhancement of our services and products, statements about future market conditions, supply and demand conditions, and other expectations, intentions and plans contained in this press release that are not historical fact and involve risks and uncertainties. Our expectations regarding future revenues depend upon our ability to develop and supply products, which we may not produce today and that meet defined specifications. When used in this press release, the words ``plan,'' ``expect,'' ``believe,'' and similar expressions generally identify forward-looking statements. These statements reflect our current expectations. They are subject to a number of risks and uncertainties, including, but not limited to, changes in technology and changes in pervasive markets.
Sept 8, 2008
Form 8-K for ALTERNATIVE CONSTRUCTION TECHNOLOGIES, INC.
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8-Sep-2008
Change in Directors or Principal Officers, Financial
ITEM 5.02DEPARTURE OF CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.
On September 4, 2008, Michael Hawkins resigned as CEO and Chairman of the Board of Directors. On that date, Anthony Francel, the Company's COO was named CEO and Chairman of the Board of Directors. Mr. Hawkins will continue as a member of the Board of Directors.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
Aug. 28, 2008
RedChip Visibility Issues Second Quarter 2008 Research Update On Alternative Construction Technologies
Thursday August 28, 3:57 pm ET
ORLANDO, Fla., Aug. 28, 2008 (GLOBE NEWSWIRE) -- RedChip Visibility, a division of RedChip Companies, Inc. has issued a second quarter 2008 research update for Alternative Construction Technologies, Inc. (OTC BB:ACCY.OB - News), a company which produces structural insulated panel systems (SIPs) used in the construction of institutional, residential and commercial buildings.
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Surya Gautam, MBA, RedChip Research Analyst, reported:
``While ACCY had been profitable for the four consecutive quarters prior to 1Q08, a year-over-year decline in gross profit of 82%, declining revenue, and obscene operating expenses contributed to the Company's $1.9 million net loss this quarter, a huge swing from the Company's $532,549 net income in same period of 2007.''
``With no guidance on future revenue by the Company, it has become very difficult for us to remain optimistic about ACCY's future revenue growth. By and large, we are seeing slimmer chances of the Company meeting the two conditions necessary for its survival: exponential growth in revenue and procurement of additional funding,'' he continued.
``We no longer accept ACCY as a going concern. The Company has been unable to make payments to its lenders, and although ACCY is working to restructure its debt, at least one lender has announced that it will commence collection efforts, to include foreclosure on assets securing the debenture. We are issuing a 'Sell' recommendation and believe the stock offers an unattractive risk/reward profile at this time,'' Gautam concluded.
To receive a complimentary copy of the RedChip Visibility Research Report for ACCY, please visit:
http://www.redchip.com/visibility/about.asp?page=vreport&reportid=132&from=08282008pr.
About RedChip Companies, Inc.
RedChip Companies is an international, small-cap research and financial public relations firm with offices in Orlando, Florida; Shanghai; and Paris, with affiliates in Atlanta and New York. RedChip delivers concrete, measurable results for its clients through its extensive national and international network of small-cap institutional and retail investors. RedChip has developed the most comprehensive platform of products and services for small-cap companies, including: RedChip Research(tm), Traditional Investor Relations, Digital Investor Relations, Institutional and Retail Conferences, RedChip Internet TV(tm), and RedChip Radio(tm). To learn more about RedChip's products and services please visit: http://www.redchip.com/visibility/productsandservices.asp.
The RedChip Companies, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=2761
``Discovering Tomorrow's Blue Chips Today''(tm)
Disclosure
None of the profiles issued by RedChip Companies, Inc., constitutes a recommendation for any investor to purchase or sell any particular security or that any security is suitable for any investor. Alternative Construction Technologies, Inc. paid RedChip Visibility, a division of RedChip Companies, Inc., $36,000 for RedChip Visibility Program services, which included the preparation of this equity research report. To the fullest extent permissible under applicable law, RedChip Companies, Inc. will not be liable to you or anyone else for the quality, accuracy, completeness, reliability, or timeliness of this information. To the fullest extent permitted by law, RedChip Companies, Inc., will not be liable to you or anyone else under any tort, contract, negligence, strict negligence, strict liability, products liability, or other theory with respect to this presentation of information.
25-Aug-2008
Form 8-K for ALTERNATIVE CONSTRUCTION COMPANY, INC.
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25-Aug-2008
Change in Directors or Principal Officers, Financial State
ITEM 5.02DEPARTURE OF CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.
On August 22, 2008, Carlton M. Johnson, a designee to the Board of BridgePointe Master Fund Ltd., CAMOFI Master LDC and CAMHZN Master LDC (the "Lenders") pursuant to agreements entered into between the Lenders and the Company in May 2008, resigned from the Board of Directors.
19-Aug-2008
Form 10-Q for ALTERNATIVE CONSTRUCTION COMPANY, INC.
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Quarterly Report
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED JUNE 30, 2008
The following Management's Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements under federal securities laws. Forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties. Our actual results could differ materially from those indicated by forward-looking statements as a result of various factors, including but not limited to those set forth under this Item, as well as those discussed in Part II - Item 1A, "Risk Factors," and elsewhere in this document and those that may be identified from time to time in our reports and registration statements filed with the Securities and Exchange Commission.
This discussion should be read in conjunction with the Consolidated Financial Statements and related Notes included in Part I - Item 1 of this Quarterly Report on Form 10-Q and the Consolidated Financial Statements and related Notes and the Management's Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K as filed with the Securities and Exchange Commission on March 7, 2008.
DESCRIPTION OF COMPANY:
Our corporate headquarters is located at 2910 Bush Drive, Melbourne, Florida 32935. Its website address is http://www.actechpanel.com. In addition, Alternative Construction by Revels, Inc., a subsidiary of ACCY maintains a website at www.acbyrevels.com. The website is not incorporated in this Form 10-Q.
ACCY operates under three divisions; a (i) Alternative Construction Manufacturing Division, (ii) Alternative Construction Development Division, and
(iii) Alternative Construction Ancillary Services Division. The Manufacturing Division currently contains two subsidiaries, ACMT, which manufactures the ACTech� Panel System, and ACMF, which will provide manufacturing services in Florida. The Development Division contains three subsidiaries; Alternative Construction by ProSteel Builders, Inc., Alternative Construction by Ionian, Inc., and Alternative Construction by Revels, Inc. The Alternative Construction Ancillary Services Division contains five subsidiaries; Alternative Construction Design, Inc., Alternative Construction Consulting Services, Inc., Alternative Construction Safe Rooms, Inc., Modular Rental and Leasing Corporation, and Solar 18 ACTech Panel, Inc. Future of Building Institute, Inc., as a non-profit entity, functions separately.
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OVERVIEW:
Alternative Construction Technologies, Inc., formerly known as Alternative Construction Company, Inc. (the "Company" or "ACCY"), is a Florida corporation organized in 2004 with corporate offices located in Melbourne, Florida. The Company's common stock is traded on the NASDAQ OTC Bulletin Board under the symbol "ACCY.OB."
The Company is a manufacturing company engaged in the research, development and marketing of proprietary products for the construction industry. We manufacture and distribute the ACTech� Panel, a structural insulated panel (SIP), throughout the United States. Our products are marketed through our internal sales staff and by manufacturer representatives.
The Company's primary product and service is the manufacturing, research, development and marketing of proprietary products for the construction industry. We manufacture and distribute the ACTech� Panel, a structural insulated panel (SIP), throughout the United States, with concentration in the southeast region. The Company has delivered its products and services internationally and believes that a huge portion of its future growth will be derived from those markets. The marketing of our products is through our internal sales staff and the use of manufacturer representatives. The Company currently licenses 21 manufacturer sales representatives.
Our corporate headquarters is located at 2910 Bush Drive, Melbourne, Florida 32935. Its website address is http://www.actechpanel.com. The website is not incorporated in this Form 10-Q.
In 2007, the Company experienced a 50.1% growth in sales to $12,960,008, as compared to 2006 sales of $8,634,349. Net income of $1,603,261, represents an increase of $3,642,555 in net income from 2006. The Company earned $0.22 per basic share in 2007. The potential dilutive effects of convertible debt and securities warrants and options in 2007, while providing a significant increase in available cash, would have had a negative effect on earnings by $0.08 per share outstanding during 2007. The Company performance is indicative of the management decisions made in 2006.
The growth of the Company was negatively impacted by the inability to obtain new financing in January 2008. As part of its financing in June 2007, the Company stated to its lenders that additional capital would be required within a short period of time to maintain the growth levels that the Company expected to achieve. The Company began negotiating with its financiers in December 2007 and January 2008 to secure such additional financing. Simultaneously with these discussions, the Company obtained commitments for additional equity and secured financing from third parties. In each case, such third parties required the debenture holders to waive or amend the terms of the "Green Shoe" option which they were granted in connection with the June 2007 debenture financing. A waiver or satisfactory amendment could not be agreed upon and the Company's cash needs were not met.
In May 2008 the Company entered into a $3,000,000 line of credit financing with the existing financiers. The line of credit is secured by "eligible" contracts and drawn down there under with interest at 13%. On June 30, 2008 the outstanding balance was $2,014,491, and there is currently $1,981,750 outstanding under this facility and $1,018,250 available for funding. On August 6, 2008 the Company provided the lenders with a notice of draw-down from the line of credit in the amount of $1,018,250 to maximize the line of credit. The Company provided the lenders with copies of existing contracts and purchase orders totaling an approximate $5.4 million. The Company authorized the lenders to apply $467,560 of the funding request against the outstanding debenture principal and interest, which would bring the Company current in all payments.
On July 19, 2008 BridgePointe Master Fund, one of the lenders, notified the Company that it did not intend to fund any additional draw-downs under the line of credit until all current defaults had been corrected and a "field audit" conducted. On July 31, 2008 BridgePointe Master Fund notified the Company that it was in default in its debenture and that it must cure such defaults within five (5) days. On August 1, 2008 BridgePointe Master Fund notified the Company that it was in default in its line of credit and had five (5) days to cure it. The terms of the debentures called for principal amortization there under to commence on July 1, 2008, and monthly thereafter at a rate of 1/24 per month with a balloon payment due July 1, 2009 for any outstanding remaining balance. The Company is unable to make these payments without access to additional outside funding or in connection with draw-downs under the line of credit. The Company is working with its lenders and outside parties to reach agreement upon a satisfactory restructuring of this debt or payments to cure any defaults. While the Company is hopeful that a resolution can be achieved in the short term, if it is not, at least one lender has notified the Company that it will commence collection efforts, to include foreclosure on assets securing the debenture. On August 12, 2008 the lender requested additional information in order to consider the outstanding financing obligation. The Company responded on August 14, 2008.
The following Management Discussion and Analysis should be read in conjunction with the financial statements and accompanying notes included in this Form 10-Q.
COMPARISON OF THE THREE MONTHS ENDED JUNE 30, 2008 TO THE THREE MONTHS
ENDED JUNE 30, 2007
Manufacturing Division Ancillary Division Development Division ACT Corporate Eliminations Consolidated
For the
Three Months
Ended June
30: 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007
Revenue $ 1,047,836 $ 1,630,801 $ - $ - $ 477,726 $ 2,478,931 $ - $ - $ (14,832 ) $ (111,959 ) $ 1,510,730 $ 3,997,773
Cost of
Sales 799,601 1,045,400 13 - 497,661 1,798,992 - - (14,832 ) (148,329 ) 1,282,443 2,696,063
Gross Profit 248,235 585,401 (13 ) - (19,935 ) 679,939 - - - 36,370 228,287 1,301,710
Operating
Expenses 98,359 187,427 2,285 585 86,074 236,972 1,814,011 167,347 - - 2,000,729 592,331
Income
(Loss) from
Operations $ 149,876 $ 397,974 $ (2,298 ) $ (585 ) $ (106,009 ) $ 442,967 $ (1,814,011 ) $ (167,347 ) $ - $ 36,370 $ (1,772,442 ) $ 709,379
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Total revenues decreased to $1,510,730 for the three months ended June 30, 2008 from $3,997,773 for the three months ended June 30, 2007. The decrease of $2,522,793 or 62.2% resulted primarily from the Company's inability to reach financing terms and the lack of capital it needed to move forward with the contracts it had in place. The Company believes it lost significant business because of its inability to reach financing terms with its financing partners. Once financing was achieved, May 8, 2008, the Company began moving forward with its remaining contracts, currently valued at $5.4 million, of which approximately $372,000 was recognized this quarter.
Total revenues and as a percent of consolidated revenues for the three months ended June 30, 2008, were provided as follows: Manufacturing Division - $1,047,836 (62.8%) and Development Division - $477,726 (31.6%). The difference between the reported revenue and the individual subsidiaries is the result of consolidating eliminations and the cost associated with the Ancillary Division.
Cost of sales was $1,282,443 and $2,696,063, respectively for the three months ended June 30, 2008 and 2007. As a percent of revenue, the cost of sales increased from 77.0% to 84.9%, for the three months ended June 30, 2007 as compared to the three months ended June 30, 2008. The Manufacturing Division recognizes a lower cost of sales percent, 76.3%, than the consolidated total of the developing division at 104.2%, therefore, when the Development Division recognizes a greater percentage of the overall revenue, the cost of sales increase. In addition, the pricing of raw materials has had substantial increases during this reporting period, which create a negative impact on cost of sales.
Gross profit was $228,287 and $1,301,710, respectively for the three months ended June 30, 2008 and 2007. As a percent of revenue, gross profit was 15.1% and 23.0%, respectively for the three months ended June 30, 2008 and 2007. One cause of the decline in gross profit is a direct correlation to the revenue split between the Manufacturing Division and the Development Division as defined in cost of sales above. In addition, the loss of revenue caused by the lack of funding, had a direct impact on the gross profit as the Company's management had to consider the implications of laying off qualified staff that would look for work elsewhere. The Company elected to maintain the staff and as such gross profit declined.
Total operating expenses increased to $2,000,729 for the three months ended June 30, 2008 from $592,331 for the three months ended June 30, 2007. This $1,408,398 or 70.4% increase was attributed mostly to the write-off of financing fees associated with the debenture agreement of June 30, 2007 and the financing fees and costs associated with the Line of Credit agreement of May 9, 2008 of $1,403,055.
The operating expenses and the percent of consolidated operating expenses for the three months ended June 30, 2008, were contributed as follows: Manufacturing Division $98,359 (4.9%); Development Division $86,074 (4.3%); the Ancillary Division $2,285 (0.1%); and Corporate, $1,814,011(90.7%).
Adjusted Earnings Before Depreciation, Interest, Taxes, and Amortization
The Company presents Adjusted EBITDA as a financial measure as management believes it provides useful information to investors regarding the Company's liquidity and financial condition and because management, as well as the Company's lenders, uses this measure in evaluating the performance of the Company.
Management uses Adjusted EBITDA as a supplement to GAAP measures to further evaluate the Company's period-to-period operating performance and evaluate the Company's ability to meet future capital expenditure and working capital requirements. Management believes the exclusion of non-cash charges, including stock-based compensation, is useful in measuring the Company's cash available to operations and the performance of the Company. Management also believes that financing fees associated with the raising of capital is a one time fee that does not accurately reflect the overall performance of the Company. Because the Company finds Adjusted EBITDA useful, the Company believes its investors will also find Adjusted EBITDA useful in evaluating the Company's performance.
Adjusted EBITDA should not be considered in isolation or as a substitute for net income, cash flows, or other consolidated income or cash flow data prepared in accordance with GAAP in the United States or as a measure of the Company's profitability or liquidity. Adjusted EBITDA is not in accordance with or an alternative for GAAP, and may be different from non-GAAP measures used by other companies. Unlike EBITDA which may be used by other companies or investors, Adjusted EBITDA does not include stock-based compensation charges and income from minority interest in the Company's subsidiaries, ACP, ACI, and ACSR. The Company believes that Adjusted EBITDA is of limited use in that it does not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP and does not accurately reflect real cash flow. In addition, other companies may not use Adjusted EBITDA or may use other non-GAAP measures, limiting the usefulness of Adjusted EBITDA. Therefore, Adjusted EBITDA should only be used to evaluate the Company's results of operations in conjunction with the corresponding GAAP measures. The presentation of Adjusted EBITDA is not meant to be considered in isolation or as a substitute for the most directly comparable GAAP measures. The Company compensates for the limitations of Adjusted EBITDA by relying upon GAAP results to gain a complete picture of the Company's performance. Since Adjusted EBITDA is a non-GAAP financial measure as defined by the Securities and Exchange Commission, the Company includes in the tables below reconciliations of Adjusted EBITDA to the most directly comparable financial measures calculated and presented in accordance with accounting principles generally accepted in the United States.
Three Months Ended Six Months Ended
June 30, June 30,
2008 2007 2008 2007
Net Income (Loss) $ (1,942,600 ) $ 532,548 $ (2,050,021 ) $ 641,320
Minority Interest in
Income (Loss) of
Subsidiary (9,824 ) 126,525 (5,947 ) 149,737
Provision for Income
Taxes - - - -
Interest 124,583 50,306 241,556 85,510
Income from Operations (1,827,841 ) 709,379 (1,814,412 ) 876,567
Depreciation and
Amortization 56,425 45,038 111,406 96,319
Non-Cash Stock Based
Compensation 41,800 - 56,100 -
Financing Fees 1,403,055 - 1,403,055 -
1 Adjusted EBIDTA $ (326,561 ) $ 754,417 $ (243,851 ) $ 972,886
2 Adjusted EBIDTA Margin (21.6%) 18.90% (5.99%) 17.00%
Adjusted EBIDTA is defined as net income before minority interest in income of subsidiaries, interest expense and financing fees, provisions for income taxes, depreciation, amortization, and other non-cash
1 stock-based compensation.
Adjusted EBIDTA Margin is calculated as Adjusted EBIDTA divided by total revenues for
2 the period.
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Manufacturing Division
Manufacturing Division
ACMT ACMF Eliminations Consolidated
For the Three
Months Ended June
30: 2008 2007 2008 2007 2008 2007 2008 2007
Sales $ 674,086 $ 1,630,801 $ 373,750 $ - $ (14,832 ) $ (111,959 ) $ 1,033,004 $ 1,518,842
Cost of Sales 556,241 1,045,400 243,360 - (14,832 ) (148,329 ) 784,769 897,071
Gross Profit 117,845 585,401 130,390 - - 36,370 248,235 621,771
Operating
Expenses: 98,359 187,427 - - - - 98,359 187,427
Income From
Operations $ 19,486 $ 397,974 $ 130,390 $ - $ - $ 36,370 $ 149,876 $ 434,344
ACMF recognized $373,750 (33.9%) in revenue directly associated with the facilities for GulfStream Aerospace. As ACMF was incorporated in 2008 it has no historical financials in which to compare revenue. ACMT's revenue decreased from $1,630,801 to $674,086 (58.7%) for the three months ended June 30, 2007 and 2008, respectively. ACMT revenue decrease was directly associated with the inability of the Company to receive financing, which delayed the delivery of our raw materials. The cycle for obtaining raw materials, especially our steel requirements, has created shortfalls in production and our lack of performance on outstanding orders. All steel suppliers now require cash payment before delivery scheduling, which often can take up to two weeks for delivery. As the Company has been sporadically funded under the line of credit, and never on the schedule in which it was promised, the Company must often shut down production for weeks at a time while waiting on raw materials.
The manufacturing facility, ACMT, recognizes a cost of sales percent, 82.5%, (37.7% of the overall cost of sales), while ACMF recognizes a cost of sales percent, 65.1%, (29% overall cost of sales), respectively which represents an increase of 17.6% which is caused by two factors, (i) the increase cost of raw materials, and (ii) the Company is required to maintain certain levels of staffing and facility operations that increase overall cost of sales as a percentage when production levels decline. ACMT's cost of sales decreased from 1,045,400 to 556,241 (46.8%) for the three months ended June 30, 2007 and 2008, respectively as a direct result in the reduction of gross sales.
ACMT represents 4.9% of the overall operating expenses of the Company. Payroll, insurance, maintenance and marketing represent the majority cost of operations.
Development Division
Development Division
ACP ACI ACR Eliminations Consolidated
For the Three Months
Ended June 30: 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007
Sales $ - $ 1,196,756 $ 216,691 $ 1,282,175 $ 261,035 $ - $ - $ - $ 216,691 $ 2,478,931
Cost of Sales 30 783,981 117,564 1,015,011 380,067 - - - 117,594 1,798,992
Gross Profit (30 ) 412,775 99,127 267,164 (119,032 ) - - - 99,097 679,939
Operating Expenses: 16,519 220,784 26,421 16,188 43,134 - - - 42,940 236,972
Income From
Operations $ (16,549 ) $ 191,991 $ 72,706 $ 250,976 $ (162,166 ) $ - $ - $ - $ 56,157 $ 442,967
The revenue attributed by ACI and ACR for the period was $216,691 (14.3% of the overall revenue) and $261,035 (17.7% of the overall revenue), respectively. ACPSB's revenue decreased from $1,196,756 to $0 for the three months ended June 30, 2007 and 2008, respectively, as the office has been closed.
ACI and ACR, have a higher cost of sales percent (54.3% and 145.6%, respectively) as compared to the consolidated percent. The increase of cost of sales is directly related to the delays caused by the lack of financing. ACI cost of sales represents 9.2% of the overall cost of sales, and ACR represents 29.6% of the overall cost of sales, The cost of sales for ACR relates to cost overruns on a project that was inherited with the acquisition. The overrun cost was approximately $135K. The additional increase, as a percentage, of the cost of sales was directly related to the slow building process, caused by constant delays in cash availability.
COMPARISON OF THE SIX MONTHS ENDED JUNE 30, 2008 TO THE SIX MONTHS ENDED JUNE
30, 2007
Results of Operations
Manufacturing Division Ancillary Division Development Division ACT Corporate Eliminations Consolidated
For the Six
Months Ended
June 30: 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007 2008 2007
Revenue $ 2,553,529 $ 2,651,492 $ - $ - $ 1,526,291 $ 3,298,693 $ - $ - $ (14,832 ) $ (228,472 ) $ 4,064,988 $ 5,721,713
Cost of Sales 1,885,895 1,749,918 813 - 1,414,257 2,350,802 - - (14,832 ) (228,472 ) 3,286,133 3,872,248
Gross Profit 667,634 901,574 (813 ) - 112,034 947,891 - - - - 778,855 1,849,465
Operating
Expenses 234,091 364,717 3,319 1,885 209,035 387,853 2,099,178 218,443 - - 2,545,623 972,898
Income (Loss)
from
Operations $ 433,543 $ 536,857 $ (4,132 ) $ (1,885 ) $ (96,999 ) $ 560,038 $ (2,099,178 ) $ (218,443 ) $ - $ - $ (1,766,766 ) $ 876,567
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Total revenues decreased to $4,064,988 for the six months ended June 30, 2008 from $5,721,713 for the six months ended June 30, 2007. The decrease of $1,656,725 or 28.9% resulted primarily from the Company's inability to reach financing terms and the lack of capital it needed to move forward with the contracts it had in place. The Company lost $19 million in contracts due to its inability to reach financing terms with its financing partners. Once financing was achieved, May 8, 2008, the Company began moving forward with its remaining contracts, currently valued at $5.3M, of which approximately $1.1 million was recognized during the six month period.
Total revenues and as a percent of consolidated revenues for the three months ended June 30, 2008, were provided as follows: Manufacturing Division - $2,553,529 (62.8), and Development Division - $1,526,291 (37.5%). The difference between the reported revenue and the individual subsidiaries is the result of consolidating eliminations and the cost associated with the Ancillary Division.
Cost of sales was $3,286,132 and $3,872,248, respectively for the six months ended June 30, 2008 and 2007. As a percent of revenue, the cost of sales increased from 67.7% to 80.8%, for the six months ended June 30, 2007 as compared to the six months ended June 30, 2008. The manufacturing division recognizes a lower cost of sales percent, 73.9%, than the consolidated total of the developing division at 92.7%, therefore, when the developing division recognizes a greater percentage of the overall revenue, the cost of sales increase. In addition, the pricing of raw materials has had substantial increases during this reporting period, which create a negative impact on cost of sales.
Gross profit was $743,107 and $1,849,465, respectively for the six months ended June 30, 2008 and 2007. As a percent of revenue, gross profit was 19.2% and 32.3%, respectively for the six months ended June 30, 2008 and 2007. One cause of the decline in gross profit is a direct correlation to the revenue split between the Manufacturing Division and the Development Division as defined in cost of sales above. In addition, the loss of revenue caused by the lack of funding, had a direct impact on the gross profit as the Company's management had to consider the implications of laying off qualified staff that would look for work elsewhere. The Company elected to maintain the staff and as such, gross profit declined.
Total operating expenses increased to $2,545,623 for the six months ended June 30, 2008 from $972,898 for the six months ended June 30, 2007. This $1,572,725 or 61.8% increase was mainly attributable to the write-off of financing fees associated with the debenture agreement of June 30, 2007 and the Line of Credit agreement of May 9, 2008 of $1,403,055. The additional expenses represent stock-based compensation, and an increase in marketing expenses and legal fees.
The operating expenses and the percent of consolidated operating expenses for the six months ended June 30, 2008, were contributed as follows: Manufacturing Division $234,091 (9.20%); Development Division $209,035 (8.20%); the Ancillary Division $1,034 (0.1%); and Corporate, $2,099,178 (82.4%).
Manufacturing Division
Manufacturing Division
ACMT ACMF Eliminations Consolidated
For the Six Months
Ended June 30: 2008 2007 2008 2007 2008 2007 2008 2007
. . .
Momentumtrader,
I've been eyeing this stock for a while now. I purchased LPPI about 7 years ago (Same consept however a loser). This company seems to have better fundimentals and better management. Your thoughts.
Bugsy....
Welcome everyone.
This company is the future for Green Building
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