We are an international telecommunications carrier that utilizes the Internet to provide economical international telecommunications services. Our current operations consist of providing digital voice communications over data networks and the Internet using Voice-over-Internet-Protocol ("VoIP"). We provide high quality voice and enhanced telecommunication services to carriers, telephony resellers and others through various agreements with local service providers in the United States, Mexico, Asia, the Middle East and Latin America utilizing VoIP telephony services.
We have had operating losses for almost every quarter since we began operations in 1994. Our operating losses from continuing operations were approximately $8,529,000 and $5,780,000, for the years ending July 31, 2004 and 2003, respectively. Additionally, we had a working capital deficit of approximately $18,948,000 at July 31, 2004. We have experienced difficulty in paying our vendors and lenders on time in the past, and we expect this trend to continue over the next 12 months as we continue to rebuild our operations. Moreover, we are currently pursuing various alternatives including equity offerings, exchanging some portion or all of our debt for equity, and restructuring our debt to extend the maturity. However, in the event we fail to execute on our current plan or that circumstances currently unknown or unforeseen by us arise, we may not succeed in re-capitalizing the Company or be able to obtain additional funding to allow us to meet our obligations.
Two of our subsidiaries, ATSI (Texas), Inc. ("ATSI Texas") and TeleSpan, Inc. ("TeleSpan"), filed for protection under Chapter 11 of the U.S. Bankruptcy Code on February 4, 2003 and February 18, 2003 respectively. The court ordered joint administration of these cases on April 9, 2003 and on May 14, 2003 converted the cases to a Chapter 7 proceeding. The two bankrupt subsidiaries were our two primary operating companies and they have ceased operations. These bankruptcies did not include the reporting entity ATSI Communications, Inc. (the "Company").
We have had operating losses for almost every quarter since we began operations in 1994. Our operating losses from continuing operations were approximately $8,529,000 and $5,780,000, for the years ending July 31, 2004 and 2003, respectively. Additionally, we had a working capital deficit of approximately $18,948,000 at July 31, 2004. We have experienced difficulty in paying our vendors and lenders on time in the past, and we expect this trend to continue over the next 12 months as we continue to rebuild our operations. Moreover, we are currently pursuing various alternatives including equity offerings, exchanging some portion or all of our debt for equity, and restructuring our debt to extend the maturity. However, in the event we fail to execute on our current plan or that circumstances currently unknown or unforeseen by us arise, we may not succeed in re-capitalizing the Company or be able to obtain additional funding to allow us to meet our obligations.
Two of our subsidiaries, ATSI (Texas), Inc. ("ATSI Texas") and TeleSpan, Inc. ("TeleSpan"), filed for protection under Chapter 11 of the U.S. Bankruptcy Code on February 4, 2003 and February 18, 2003 respectively. The court ordered joint administration of these cases on April 9, 2003 and on May 14, 2003 converted the cases to a Chapter 7 proceeding. The two bankrupt subsidiaries were our two primary operating companies and they have ceased operations. These bankruptcies did not include the reporting entity ATSI Communications, Inc. (the "Company").
