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 MARCH 31, 2008
INDEX
|
|
|
Page |
|
|
|
|
|
PART I - FINANCIAL INFORMATION |
| |
|
|
|
|
|
|
Item 1 - Consolidated Financial Statements |
4 |
|
|
|
|
|
|
Consolidated Balance Sheet at March 31, 2008 (Unaudited) |
4 |
|
|
|
|
|
|
Consolidated Statements of Operations (Unaudited) |
5 |
|
|
|
|
|
|
Consolidated Statements of Cash Flows (Unaudited) |
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 |
28 |
|
|
|
|
|
PART II - OTHER INFORMATION |
| |
|
|
|
|
|
|
Item 1 - Legal Proceedings |
29 |
|
|
|
|
|
|
Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds |
29 |
|
|
|
|
|
|
Item 3 - Default upon Senior Securities |
29 |
|
|
|
|
|
|
Item 4 - Submission of Matters to a Vote of Security Holders |
29 |
|
|
|
|
|
|
Item 5 - Other Information |
29 |
|
|
|
|
|
|
Item 6 - Exhibits |
29 |
- 3 -
PART I - FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
ICEWEB, Inc.
Consolidated Balance Sheet
March 31, 2008
(Unaudited)
|
CURRENT ASSETS: |
|
|
|
|
|
Cash |
|
$ |
123,399 |
|
|
Accounts receivable, net of allowance of $9,000 |
|
|
2,523,600 |
|
|
Inventory, net of allowance of $106,541 |
|
|
464,577 |
|
|
Other current assets |
|
|
62,769 |
|
|
Prepaid expenses |
|
|
71,543 |
|
|
|
|
|
3,245,888 |
|
|
|
|
|
|
|
|
OTHER ASSETS: |
|
|
|
|
|
Property and equipment, net |
|
|
722,138 |
|
|
Deposits |
|
|
71,804 |
|
|
Intangible assets, net of accumulated amortization of $220,087 |
|
|
155,392 |
|
|
Goodwill |
|
|
1,715,450 |
|
|
Total Assets |
|
$ |
5,910,672 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
|
Accounts payable and accrued liabilities |
|
$ |
4,605,562 |
|
|
Notes payable |
|
|
2,483,145 |
|
|
Deferred revenue |
|
|
18,594 |
|
|
|
|
|
7,107,301 |
|
|
|
|
|
|
|
|
Long-Term Liabilities |
|
|
|
|
|
Notes payable |
|
|
1,036,261 |
|
|
|
|
|
|
|
|
Total Liabilities |
|
|
8,143,562 |
|
|
|
|
|
|
|
|
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; 15,800,338 shares issued and 15,637,838 shares outstanding) |
|
|
15,802 |
|
|
Additional paid in capital |
|
|
13,674,890 |
|
|
Accumulated deficit |
|
|
(15,912,415 |
) |
|
Treasury stock, at cost, (162,500 shares) |
|
|
(13,000 |
) |
|
|
|
|
|
|
|
Total stockholders’ deficit |
|
|
(2,232,890 |
) |
|
|
|
|
|
|
|
Total liabilities and stockholders’ deficit |
|
$ |
5,910,672 |
|
See accompanying notes to unaudited consolidated financial statements
- 4 -
ICEWEB, Inc.
Consolidated Statements of Operations
(Unaudited)
|
|
|
Three Months Ended |
|
Six Months Ended |
| ||||||||
|
|
|
2008 |
|
2007 |
|
2008 |
|
2007 |
| ||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales |
|
$ |
3,902,131 |
|
$ |
5,877,457 |
|
$ |
8,114,863 |
|
$ |
8,459,234 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales |
|
|
3,264,075 |
|
|
5,181,233 |
|
|
6,877,890 |
|
|
7,476,642 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
|
638,056 |
|
|
696,224 |
|
|
1,236,973 |
|
|
982,592 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marketing and selling |
|
|
59,314 |
|
|
111,013 |
|
|
88,720 |
|
|
171,229 |
|
|
Depreciation and amortization |
|
|
76,533 |
|
|
65,595 |
|
|
152,364 |
|
|
131,136 |
|
|
Research and development |
|
|
85,730 |
|
|
— |
|
|
85,730 |
|
|
— |
|
|
General and administrative |
|
|
1,811,312 |
|
|
414,518 |
|
|
2,818,260 |
|
|
1,174,883 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Operating Expenses |
|
|
2,032,889 |
|
|
591,126 |
|
|
3,145,074 |
|
|
1,477,248 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) From Operations |
|
|
(1,394,833 |
) |
|
105,098 |
|
|
(1,908,101 |
) |
|
(494,656 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expenses): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain/(loss) from sale of assets |
|
|
— |
|
|
14,733 |
|
|
— |
|
|
153,319 |
|
|
Interest income |
|
|
1,661 |
|
|
952 |
|
|
2,584 |
|
|
2,261 |
|
|
Interest expense |
|
|
(187,371 |
) |
|
(103,880 |
) |
|
(285,007 |
) |
|
(234,085 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total other (expenses): |
|
|
(185,710 |
) |
|
(88,195 |
) |
|
(282,423 |
) |
|
(78,505 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
(1,580,543 |
) |
$ |
16,903 |
|
$ |
(2,190,524 | ||||