Item 1 is incorporated by reference to the
unaudited financial statements beginning at page F-1 of this quarterly
report.
The
accompanying unaudited financial statements have been prepared in accordance
with accounting principles generally accepted in the United States of America
for interim financial information and with the instructions to Form 10-QSB.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
The accompanying unaudited financial statements reflect all adjustments that,
in
the opinion of management, are considered necessary for a fair presentation
of
the financial position, results of operations, and cash flows for the periods
presented. The results of operations for such periods are not necessarily
indicative of the results expected for the full fiscal year or for any future
period. The accompanying unaudited financial statements should be read in
conjunction with the audited financial statements of Java Detour, Inc. included
in our Annual Report on Form 10-KSB for the fiscal year ended December 31,
2006
as filed with the Securities and Exchange Commission (the “SEC”) on April 2,
2007 and as may be amended.
JAVA
DETOUR, INC. AND SUBSIDIARIES
CONSOLIDATED
BALANCE SHEET
SEPTEMBER
30, 2007
(Unaudited)
|
ASSETS
|
||||
|
CURRENT
ASSETS:
|
||||
|
Cash
and cash equivalents
|
$
|
1,527,985
|
||
|
Accounts
receivable, net
|
36,703
|
|||
|
Inventories
|
79,550
|
|||
|
Prepaid
expenses
|
162,178
|
|||
|
Total
current assets
|
1,806,416
|
|||
|
|
||||
|
NONCURRENT
ASSETS:
|
||||
|
Notes
receivable
|
900,000
|
|||
|
Property
and equipment, net
|
3,788,069
|
|||
|
Intangibles
|
65,482
|
|||
|
Prepaid
expenses
|
12,318
|
|||
|
Deferred
tax assets
|
485,647
|
|||
|
Other
assets
|
67,104
|
|||
|
|
||||
|
TOTAL
ASSETS
|
$
|
7,125,036
|
||
|
|
||||
|
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||
|
CURRENT
LIABILITIES:
|
||||
|
Accounts
payable
|
$
|
669,174
|
||
|
Accounts
payable, related party
|
22,665
|
|||
|
Deferred
revenue
|
714,000
|
|||
|
Notes
payable, current portion
|
62,490
|
|||
|
Capital
leases, current portion
|
256,705
|
|||
|
Accrued
expenses and other current liabilities
|
402,631
|
|||
|
Total
current liabilities
|
2,127,665
|
|||
|
|
||||
|
Notes
payable, net of current portion
|
909,940
|
|||
|
Capital
lease obligations, net of current portion
|
576,116
|
|||
|
Deferred
rent
|
175,725
|
|||
|
Total
liabilities
|
3,789,446
|
|||
|
|
||||
|
COMMITMENTS
AND CONTINGENCIES
|
||||
|
STOCKHOLDERS’
EQUITY:
|
||||
|
Preferred
stock, $0.001 par value; 5,000,000 shares authorized;
|
||||
|
0
shares issued and outstanding
|
-
|
|||
|
Common
stock, $0.001 par value; 75,000,000 shares authorized;
|
||||
|
28,731,323
shares issued and outstanding
|
28,732
|
|||
|
Additional
paid in capital
|
14,634,451
|
|||
|
Accumulated
deficit
|
(11,327,593
|
)
|
||
|
Total
stockholders’ equity
|
3,335,590
|
|||
|
|
||||
|
TOTAL
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$
|
7,125,7036
|
||
The
accompanying notes are an integral part of these consolidated financial
statements.
F-1
JAVA
DETOUR, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE (LOSS)
THREE
AND NINE MONTHS ENDED SEPTEMBER 30, 2007 AND 2006
(Unaudited)
|
Sept
30, 2007
|
Sept
30, 2006
|
Sept
30, 2007
|
Sept
30, 2006
|
||||||||||
|
OPERATING
REVENUES:
|
Three
months ended
|
Three
months ended
|
Nine
months
ended
|
Nine
months ended
|
|||||||||
|
Sales
and other operating revenues, net
|
$
|
1,745,552
|
$
|
1,660,466
|
$
|
5,026,142
|
$
|
4,783,727
|
|||||
|
Cost
of sales
|
(484,083
|
)
|
(467,976
|
)
|
(1,583,248
|
)
|
(1,357,615
|
)
|
|||||
|
Gross
profit
|
1,261,469
|
1,192,490
|
3,442,894
|
3,426,112
|
|||||||||
|
|
|||||||||||||
|
OPERATING
EXPENSES:
|
|||||||||||||
|
Store
operating expenses
|
1,070,248
|
863,569
|
3,481,219
|
2,403,292
|
|||||||||
|
Selling,
general and administrative expenses
|
1,030,234
|
312,410
|
3,332,350
|
748,221
|
|||||||||
|
Acquisition
due diligence cost
|
181,808
|
-
|
181,808
|
-
|
|||||||||
|
Depreciation
|
110,410
|
116,187
|
367,532
|
310,967
|
|||||||||
|
|
|||||||||||||
|
Total
operating expenses
|
2,392,700
|
1,292,166
|
7,362,909
|
3,462,480
|
|||||||||
|
|
|||||||||||||
|
INCOME
(LOSS) FROM OPERATIONS
|
(1,131,231
|
)
|
(99,676
|
)
|
(3,920,015
|
)
|
(36,368
|
)
|
|||||
|
OTHER
INCOME/(EXPENSE):
|
|||||||||||||
|
Other
income
|
16,887
|
(183,294
|
)
|
132,389
|
38,820
|
||||||||
|
Interest
(expense)
|
(69,696
|
)
|
(252,776
|
)
|
(208,303
|
)
|
(619,014
|
)
|
|||||
|
Gain
on registration rights agreement
|
-
|
-
|
150,000
|
-
|
|||||||||
|
Other
(expenses)
|
(904,710
|
)
|
(14,001
|
)
|
(930,139
|
)
|
(47,914
|
)
|
|||||
|
Total
other income/(expense)
|
(957,519
|
)
|
(450,071
|
)
|
(856,053
|
)
|
628,108
|
||||||
|
NET
INCOME (LOSS) BEFORE INCOME TAXES
|
(2,088,750
|
)
|
(549,747
|
)
|
(4,776,068
|
)
|
(664,476
|
)
|
|||||
|
INCOME
TAX (EXPENSE) BENEFIT
|
(922
|
)
|
(3,322
|
)
|
3,996
|
||||||||
|
|
|||||||||||||
|
NET
INCOME (LOSS)
|
$
|
(2,089,672
|
)
|
$
|
(549,747
|
)
|
|||||||