Networm, it looks like IGII booked a chunk of rev in Q4 related to a South Africa contract, roughly 3.2MM. They said they were allowed to book 75% of the contract up front:
"Our licenses for Industrial Development Corporation of South Africa Initiative were sold for $4.25 million dollars for the first year of license. The Company recognizes 75% of the license fee or $3,187,500 as revenue upon the activation of the license. The balance of 25% is amortized on a straight line basis over a one year period."
Deferred revenues actually dropped slightly during FY05, so they recognized this contract and don't appear to have much left in backlog/def rev.
Plus, they issue shares for services because they have such poor cash flow. They just recently issued nearly 9MM more shares for debt:
"NOTE 10 - SUBSEQUENT EVENTS:
On March 17, 2006, IBSG International, Inc. (the “Company”) executed an agreement And Plan Of Merger And Reorganization with A-Division IT, Ltd. a corporation incorporated under the laws of the United Kingdom, London (primarily an IT International Technology Consultant). A-Division IT, Ltd. is engaged in international business development and consultancy in the Technology sector and is a subcontractor for BAE System's offset credit projects around the world.
Effective March 18, 2006, Galaxy Five (PTY) Ltd, a South African entity which operates as a business consultant firm designed to improve vendor capabilities and produce vendor opportunities for the South African market with multi-national firms in specific vertical industries beginning with the mining industry of South Africa, acquired selected Company assets, specifically the Company’s right, title and interest in and to the asset known as the CAC contract in Nigeria and all associated assets (the “Asset”) as disclosed on the Asset Purchase Agreement between the parties.
On January 11, 2006 the Company issued 8,347,336 common stock for debt.
On January 6, 2006 the Company issued 110,000 common stock for cash.
On January 27, 2006 the Company issued 100,000 common stock for services
---------------------
Because this occurred after the quarter, these aren't in the FD totals. Weighted avg fd shares totalled 48.3MM for FY05. As of the end of FY05, there are 60.4MM fd shares which don't include the above share amounts.
The stock certainly looks undervalued based upon a quick perusal of the numbers. Bobwins and I remember this outfit from way back when they were doing a reverse merger into a shell company....with assets (IBSG) that were not what Rivers represented them as being in numerous PRs. They had a good quarter, but timing of contract recognition played a major role in that. If you back out this lump-sum, they appear to have lost money in the quarter. I think its fair to say that they will NOT be as profitable next quarter, but of course miracles could happen.
AI
