Astrata Group, Inc - These unaudited condensed consolidated...

Astrata Group, Inc - Recent Material Event

Item 1 Financial Statements (Unaudited)

Condensed Consolidated Balance Sheet as of November 30, 2007	F-1

Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and nine months ended November 30, 2007 and 2006	F-2

Condensed Consolidated Statements of Cash Flows for the nine months ended November 30, 2007 and 2006	F-3

Notes to Condensed Consolidated Financial Statements	F-4

Item 2 Management’s Discussion and Analysis or Plan of Operation

Item 3 Controls and Procedures

Part II - Other Information

Item 1 Legal Proceedings

Item 2 Unregistered Sales of Equity Securities and Use of Proceeds

Item 6 Exhibits and Reports on Form 8-K

PART I – FINANCIAL INFORMATION

Item 1: Condensed Consolidated Financial Statements (Unaudited)

These unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and the Securities and Exchange Commission (the “SEC”) instructions to Form 10-QSB. In the opinion of management, all adjustments considered necessary for a fair presentation, which (except where stated otherwise) consisted only of normal recurring adjustments, have been included. Operating results for the interim period ended November 30, 2007 are not necessarily indicative of the results anticipated for the entire fiscal year ending February 28, 2008. This report should be read in conjunction with the Company’s February 28, 2007 annual report on Form 10-KSB filed with the SEC on May 30, 2007.

ASTRATA GROUP INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
NOVEMBER 30, 2007

ASSETS

Current Assets:
Cash and cash equivalents	$	1,161,881
Trade and other receivables, net		1,312,683
Inventories		296,355
Other assets		410,643
Discontinued operations - current assets		90,576
Total current assets		3,272,138
Property and equipment, net		679,491
Certificate of deposit-restricted		412,987
Goodwill		300,000
Discontinued operations - other assets		69,666
Total assets	$	4,734,282
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
Accounts payable	$	6,183,212
Salaries and benefits payable to officers and directors		2,027,827
Registration rights penalties		599,241
Interest payable		1,402,338
Income taxes and related penalties payable		508,765
Convertible notes payable to stockholders		1,884,000
Advances from stockholders		142,568
Discontinued operations - current liabilities		241,466
Current portion of long-term liabilities		800,377
Billings in excess of costs and estimated earnings on uncompleted contract		611,972
Other current liabilities		400,354
Total current liabilities		14,802,120
Long-term liabilities		11,377
Total liabilities		14,813,497
Minority interest		40,114

Stockholders' deficit
Preferred stock, Series A convertible, $0.0001 par value, 10,000,000 shares
authorized, 4,550,000 shares issued and outstanding with a liquidation
preference of $2,800,000
Common stock, $0.0001 par value, 100,000,000 shares
authorized, 28,921,315 shares issued		2,566
and 25,649,891 shares outstanding
Additional paid-in-capital		34,321,430
Accumulated deficit		(43,497,916	)
Accumulated other comprehensive loss		(945,864	)
Total stockholders' deficit		(10,119,329	)
Total liabilities and stockholders' deficit	$	4,734,282


See accompanying notes to these condensed consolidated financial statements.

F-1

ASTRATA GROUP INCORPORATED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
FOR THE THREE AND NINE MONTHS ENDED NOVEMBER 30, 2007 AND 2006
(UNAUDITED)


	THREE MONTHS						NINE MONTHS

Net sales	$	4,718,503		$	758,035		$	10,350,895		$	2,097,241
Cost of goods sold		3,502,922			423,667			7,446,564			1,399,243
Gross profit		1,215,581			334,368			2,904,331			697,998
Selling, general and administrative expenses		1,529,072			2,106,828			7,776,890			6,073,663
Research and development		-			119,331			-			119,331
Operating loss		(313,491	)		(1,891,791	)		(4,872,559	)		(5,494,996	)
Other income (expense):
Interest expense		(749,330	)		(1,529,043	)		(964,137	)		(1,964,632	)
Change in fair value of derivative warrant liability		-			1,501,800			-			1,808,796
Loss on debt extinguishment		-			(4,419,250	)		-			(4,419,250	)
Other income		81,376			(30,048	)		83,013
Total other income (expense)		(667,954	)		(4,476,541	)		(881,124	)		(4,574,376	)