41,514,739 common shares at June 30, 2007
Capital Stock
Authorized:
125,000,000 common shares par value $0.0002 per share
15,000,000 preferred shares, par value $0.0001 per share
Issued and outstanding:
41,514,739 common shares at June 30, 2007
and 30,558,352 at September 30, 2006
No Series A preferred shares at June 30, 2007,
and 792,592 at September 30, 2006
3,000,750 Series B preferred shares at June 30, 2007,
and at September 30, 2006
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
FORWARD-LOOKING STATEMENTS
Except for the historical information and discussions contained herein, statements contained in this Form 10-QSB may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially, including any projections of earnings, revenues, or other financial items; any statements of the plans, strategies, and objectives of management for future operation; any statements concerning proposed new products, services, or developments, any statements regarding future economic conditions or performance, statements of belief, statements of assumptions underlying any of the foregoing and other risks, uncertainties and factors discussed elsewhere in this Form 10-QSB or in the Company’s other filings with the Securities and Exchange Commission
OVERVIEW
Paivis Corp.’s (“Paivis”, the “Company” or the “Registrant”) business operations commenced June 2000 and consist of telecommunications switching services. Paivis is facility-based wholesale telecommunications carrier that delivers many application/value-added services within the prepaid services space. The Company operates and maintains a robust switching facility, offering over 16,000 ports with connectivity to most of the tier 1 carriers in the US and manages an extensive international (A-Z) network. In addition to the wholesale business, Paivis maintains a large retail distribution network for direct to consumer services. Our products are sold through approximately 5,000 retail outlets in the United States and our distribution is rapidly expanding.
The future growth of the Company is focused on implementing a plan of growth of our current business operations, and also growth through acquisitions. The Company is currently in discussions with several acquisition candidates.
The following analysis discusses changes in the financial condition and results of operations at and for the three months periods ended on June 30, 2007 and June 30, 2006 and should be read in conjunction with our unaudited consolidated financial statements and the notes thereto. This subsection of MD&A is an overview of the important factors that management focuses on in evaluating our businesses, financial condition and operating performance, our overall business strategy and our earnings, if any, for the periods covered.
OUR COMPANY HISTORY
Paivis,Corp, (formerly known as APO Health, Inc., Internetfinancialcorp.com, Caribbean Ventures Inc., and Dom Caribe Ltd.) was originally incorporated in the State of Nevada in April 1997. From mid 2001 until mid 2006, our predecessor, APO Health, Inc. was primarily engaged in the business of wholesale medical products. In May of 2006 the Registrant completed a Merger transaction (details below) where effectively Jupiter Global Holdings, Corp. became a wholly owned subsidiary of the Registrant. With completion of the Merger transaction the Registrant effected a sale of the APO Health subsidiary (“APO Health NY”) responsible for the business of wholesale medical products (details below). Furthermore, due to the Merger transaction and subsequent sale of APO Health NY the Registrants business will be primarily engaged in the core operating business of Jupiter, prepaid technologies and telecom-based services.
Headquartered in Atlanta, Georgia, the Company is publicly traded and Paivis, Corp. presently conducts its business operations through its operating subsidiaries located in the United States.
OUR BUSINESS OPERATIONS
Paivis’ present business operations commenced June 2000 and involve providing prepaid long distance services. We generate revenues through the domestic and foreign sale of a variety of telecommunications products and services, such as prepaid calling cards, prepaid wireless service and international wholesale termination. Our products are sold through approximately 5,000 retail outlets in the United States and our distribution is rapidly expanding.
The discussion below of our performance is based upon our consolidated financial statem ents as of and for the three months periods ended June 30, 2007 and June 30, 2006.
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RESULTS OF OPERATIONS
FOR THE THREE MONTH PERIOD ENDED JUNE 30, 2007
For the three month period ended June 30, 2007, the Company earned revenues of $1,322,439. The revenues were from sales of airtime related to telephone calling cards.
During the three month period ended June 30, 2007, the Company incurred operational expenses of $616,255. These operating expenses included: consulting fees of $95,171, wages and benefits of $171,246, and professional fees of $212,561 for the three month period ending June 30, 2007.
During the three month period ended June 30, 2007, the Company incurred a net loss from operations of $730,408.
FOR THE THREE MONTH PERIOD ENDED JUNE 30, 2007, COMPARED TO THE THREE MONTH PERIOD ENDED JUNE 30, 2006.
For the three month period ended June 30, 2007, the Company earned revenues of $1,322,439 as compared to revenues of $1,417,623 for the same period ended June 30, 2006. The changes in revenues in 2007 are a result of the Company’s continued efforts to restructure its business and product offerings, and its efforts to minimize the sale of products with lower margins.
For the three month period ended June 30, 2007, the Company incurred operational expenses of $616,255 as compared to $1,045,323 during the same period in the previous year. These operating expenses included: consulting fees of $95,171 and $103,000, wages & benefits of $171,246 and $178,495, and professional fees of $212,561 and $118,834 for the three month period ended June 30, 2007 and 2006, respectively. The variation in expenses from June 30, 2007 as compared to the same period in the previous year is due to the continued efforts to restructure its business operations and reduction of debt.
The Company incurred a net loss from operations of $730,408 for the fiscal quarter ended June 30, 2007, as compared to $1,054,734 for the same period in the previous year.
SIGNIFICANT ACCOUNTING POLICIES
Our significant accounting policies have been outlined in our 10KSB filing for the year ending September 30, 2006, and are thus incorporated by reference. We have had no significant changes to our accounting policies or assumptions in the three month period ending June 30, 2007.
Liquidity and Financial Condition As Of June 30, 2007
We had cash-on hand totaling $ 4,469 as of June 30, 2007.
We believe that our currently available working capital provided by operating activities may be insufficient to meet our operations at our current level and working capital and capital expenditure needs over the next 12 months. Our future capital requirements will depend on many factors, including our rate of revenue growth, the expansion of our marketing and sales activities, the timing and extent of spending to support product development efforts and expansion into new territories, the timing of introductions of new products or services, the timing of enhancements to existing products and services and the timing of capital expenditures. Also, we may make investments in, or acquisitions of, complementary businesses, services or technologies which could also require us to seek additional equity or debt financing. To the extent that available funds are insufficient to fund our future activities, we may need to raise additional funds through public or private equity or debt financing. Additional funds may not be available on terms favorable to us or at all.
