Bigduke7
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Monday, February 20, 2012 4:52:04 PM
Re: None
Post # of 14527
-=* My Forensic Report *=-
I have just visited the SEC website and looked at their last 10Q (again). I have decided to go ahead and present some of my findings. I am also an accounting major as a forensic accountant.
I will highlight and simplify some items I think are of interest.
Net income = 3,251,575 (This is not a loss!)
Basic income per common share = $.03
Weighted average common shares outstanding - diluted= 353,118,938
As the audited opinion confirms: “The accompanying financial statements have been prepared on a going concern basis, which assumes the Company will realize its assets and discharge its liabilities in the normal course of business. As reflected in the accompanying financial statements, the Company had insignificant revenues for the six months period ended September 30, 2011, a working capital deficit of $9,721,641 as of September 30, 2011 and has incurred losses to date resulting in an accumulated deficit of $19,115,631, including derivative income and expense.”
(Note the accumulated deficit, I’ll get back to that in a second). Okay now read the second part of the audit opinion carefully.
“These factors create substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or to obtain the necessary financing to meet its obligations and pay its liabilities when they come due. Management’s plan includes obtaining additional funds by debt and/or equity financings; however, there is no assurance of additional funding being available.”
Ooohh. Substantial doubt… Scary!!!
Folks, the audit understood this is going from development to “profitable operations”. Simply meaning they better start selling or else.. Ok.. Looks to me like their selling… JMO ahh wait, it’s not my opinion, it’s a FACT their selling..
Income (Loss) Per Common Share:
The basic income (loss) per common share is computed by dividing the income (loss) applicable to common stockholders by the weighted average number of common shares outstanding during the reporting period. Diluted income (loss) per common share is computed similar to basic income (loss) per common share except that diluted income per common share includes dilutive common stock equivalents, using the treasury stock method, and assumes that the convertible debt instruments were converted into common stock upon issuance, if dilutive. For the six months ended September 30, 2011, potential common shares arising from the Company’s stock warrants, stock options and convertible debt and preferred stock amounting to 250,805,447 shares were included in the computation of diluted income per share.
(thought I read someone saying the convertible notes amounted to 500K shares or something crazy like that. If you note above it is just around 250M. Most likely much of the shares have already been diluted, perhaps in the past month or so. This was also confirmed today by Smoke em. Thanks for calling Roy about that Smoke!)
Also, yes there are also about 30 pages of the descriptions of the various debts (convertible notes, derivatives, etec). Show me any startup company without something like that… But you do not need to go through and look at all of that. For now, let’s look at revenue. For the six months ended Sept. 2011 the total revenue was 91,455. Clearly this an inadequate figure to achieve a profit. However, we would do well to remember this was and is still a startup, as meaning “in progress”.
Getting back to the working capital deficit of $9,721,641 as of September 30, 2011 and incurred losses to date resulting in an accumulated deficit of $19,115,631, including derivative income and expense. Indeed, these are hefty sums. But let’s put this into perspective. How much is Phase III worth? That’s the question you should be asking and that’s where we are right now. Yesterday’s PR may be an indication that things will go very well. It could also take much of the year to really get a feel for the market, but so far there has been nothing but positive news. This is especially true in terms of distribution. Remember the positive net income? Yes, that is a reflection of ATTD’s ability to pay its bills! Nuff said.. Right?..
Now comes the easy part.. In your average 53 foot truck you can fit 26 pallets. Now assume every pallet contains 5000 bottles of (this could be a conservative number so do your own DD). That is 5000 x 26 = 130000 bottles of Phase III. To calculate revenue is speculation at this point but as 12 pack cases are known to be selling at $36.50 (yes right now,,, check it if you want) a case on Supplement Warehouse.com, (that’s roughly $3.00 a bottle market). Suppose, ATTD wholesales for $2.00 a bottle and that’s conservatively $260,000.00 revenue in just one truckload and that would more than double the total revenue for all of last year…. See where I am going with this? Do I really need to keep writing?
IMO Roy is not charging out of the gate and is taking a methodical approach in terms of the market. This will ensure the company can react and respond to consumer demands when it does the gradual (and most likely substantial increase). I expect the next quarter report to be not much better but this is already understood to those of us here on the ground floor.
Something to think about:
5 truckloads = 1.3M in revenue (conservatively).
GO ATTD
Bigduke7
