CAUTIONARY STATEMENT REGARDING FORWARD LOOKING INFORMATION

 

This quarterly report contains forward-looking statements. These forward-looking statements are subject to risks and uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from the results, performance or achievements expressed or implied by the forward-looking statements. You should not unduly rely on these statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They use words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “project,” “contemplate,” “would,” “should,” “could,” or “may.” With respect to any forward-looking statement that includes a statement of its underlying assumptions or bases, we believe such assumptions or bases to be reasonable and have formed them in good faith, assumed facts or bases almost always vary from actual results, and the differences between assumed facts or bases and actual results can be material depending on the circumstances. When, in any forward-looking statement, we express an expectation or belief as to future results, that expectation or belief is expressed in good faith and is believed to have a reasonable basis, but there can be no assurance that the stated expectation or belief will result or be achieved or accomplished. All subsequent written and oral forward-looking statements attributable to us, or anyone acting on our behalf, are expressly qualified in their entirety by the cautionary statements.

 

OTHER PERTINENT INFORMATION

 

When used in this quarterly report, the terms “IceWEB,” the “Company,” “ we,” “our,” and “us” refers to IceWEB, Inc., a Delaware corporation, and our subsidiaries. The information which appears on our web site at www.iceweb.com is not part of this quarterly report.

 

- 2 -


ICEWEB, INC. AND SUBSIDIARIES

FORM 10-QSB

QUARTERLY PERIOD ENDED December 31, 2007

 

INDEX

 

 

 

Page

 

 

 

PART I - FINANCIAL INFORMATION

 

 

 

 

 

Item 1 - Consolidated Financial Statements

4

 

 

 

 

Consolidated Balance Sheet at December 31, 2007 (Unaudited)

4

 

 

 

 

Consolidated Statements of Operations (Unaudited)
     For the Three months Ended December 31, 2007 and 2006

5

 

 

 

 

Consolidated Statements of Cash Flows (Unaudited)
     For the Three months Ended December 31, 2007 and 2006

6

 

 

 

 

Notes to Unaudited Consolidated Financial Statements

7-18

 

 

 

 

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

19-27

 

 

 

 

Item 3 - Controls and Procedures

27

 

 

 

PART II - OTHER INFORMATION

 

 

 

 

 

Item 1 - Legal Proceedings

28

 

 

 

 

Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds

28

 

 

 

 

Item 3 - Default upon Senior Securities

28

 

 

 

 

Item 4 - Submission of Matters to a Vote of Security Holders

28

 

 

 

 

Item 5 - Other Information

28

 

 

 

 

Item 6 - Exhibits

28

 

- 3 -


PART I - FINANCIAL INFORMATION

 

Item 1. Consolidated Financial Statements

 

ICEWEB, Inc.

Consolidated Balance Sheet

December 31, 2007

(Unaudited)

 

CURRENT ASSETS:

 

 

 

 

Cash

 

$

658,697

 

Accounts receivable, net of allowance of $9,000

 

 

2,935,795

 

Inventory, net of allowance of $106,541

 

 

503,024

 

Prepaid expenses

 

 

111,254

 

 

 

 

4,208,770

 

 

 

 

 

 

OTHER ASSETS:

 

 

 

 

Property and equipment, net

 

 

743,596

 

Deposits

 

 

74,456

 

Intangible assets, net of accumulated amortization of $192,131

 

 

183,348

 

Goodwill

 

 

1,575,945

 

Total Assets

 

$

6,786,115

 

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

Accounts payable and accrued liabilities

 

$

4,962,452

 

Notes payable

 

 

2,732,821

 

Notes payable-related party

 

 

100,296

 

Deferred revenue

 

 

22,069

 

 

 

 

7,817,638

 

 

 

 

 

 

Long-Term Liabilities

 

 

 

 

Notes payable

 

 

65,221

 

 

 

 

 

 

Total Liabilities

 

 

7,882,859

 

 

 

 

 

 

Stockholders’ Deficit

 

 

 

 

Preferred stock ($.001 par value; 10,000,000 shares authorized)

 

 

 

 

Series A convertible preferred stock ($.001 par value; 0 shares issued and outstanding)

 

 

—

 

Series B convertible preferred stock ($.001 par value; 1,833,334 shares issued and outstanding)

 

 

1,833

 

Common stock ($.001 par value; 1,000,000,000 shares authorized; 15,000,338 shares issued and 14,837,838 shares outstanding)

 

 

15,002

 

Additional paid in capital

 

 

13,231,294

 

Accumulated deficit

 

 

(14,331,873

)

Treasury stock, at cost, (162,500 shares)

 

 

(13,000

)

 

 

 

 

 

Total stockholders’ deficit

 

 

(1,096,744

)

 

 

 

 

 

Total liabilities and stockholders deficit

 

$

6,786,115

 

 

See accompanying notes to unaudited consolidated financial statements

 

- 4 -


ICEWEB, Inc.

Consolidated Statements of Operations

 

 

Three Months Ended
December 31

 

 

2007

 

2006

 

 

 

 

 

 

 

 

Sales

$

4,212,732

 

$

2,581,777

 

 

 

 

 

 

 

 

Cost of sales

 

3,613,816

 

 

2,295,410

 

 

 

 

 

 

 

 

Gross profit

 

598,916

 

 

286,367

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

Marketing and selling

 

29,405

 

 

60,216

 

Depreciation and amortization

 

75,831

 

 

65,541

 

General and administrative

 

1,006,948

 

 

760,366

 

 

 

 

 

 

 

 

Total Operating Expenses

 

1,112,184

 

 

886,123

 

 

 

 

 

 

 

 

Loss From Operations

 

(513,268

)

 

(599,756

)

 

 

 

 

 

 

 

Other income (expenses):

 

 

 

 

 

 

Gain/(loss) from sale of assets

 

—

 

 

138,586

 

Interest income

 

924

 

 

1,309

 

Interest expense

 

(97,636

)

 

(130,205

)

 

 

 

 

 

 

 

Total other income (expenses):

 

(96,712

)

 

9,690

 

 

 

 

 

 

 

 

Net loss

$

(609,980

)

$

(590,066

)

 

 

 

 

 

 

 

Basic and diluted loss per common share

$

(0.05

)

$

(0.06

)

 

 

 

 

 

 

 

Weighted average common shares outstanding – basic and diluted

 

13,305,466

 

 

9,423,344

 

 

See accompanying notes to unaudited consolidated financial statements

 

- 5 -


ICEWEB, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

 

 

 

Three Months Ended
December 31,

 

 

 

2007

 

2006

 

 

 

 

 

 

 

 

 

NET CASH PROVIDED/(USED) IN OPERATING ACTIVITIES

 

$

724,231

 

$

(391,006

)

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

Purchase of property and equipment

 

 

(9,892

)

 

(1,874

)

Net cash received from sale of net assets

 

 

—

 

 

138,000

 

Cash used in acquisitions, net

 

 

(1,538,407

)

 

(250,000

)

NET CASH USED IN INVESTING ACTIVITIES

 

 

(1,548,299

)

 

(113,874

)

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES: