EX-99.2 3 cint052506ex992.htm PROFORMA FINANCIALS SECFiling
 
MOBILE REACH INTERNATIONAL, INC. AND SUBSIDIARIES
INTRODUCTION TO PRO-FORMA CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED OCTOBER 31, 2005
 
 

            The following unaudited pro-forma consolidated balance sheet, pro-forma income statements and the explanatory notes give effect to the acquisition of Objective Spectrum, Inc. (“OS”) by Mobile Reach International, Inc. (“MRI”) transaction resulted in MRI owning all the shares of OS. The transaction has been treated for accounting purposes as an acquisition by MRI of the net assets and liabilities of OS.

            The pro-forma consolidated balance sheet, pro-forma consolidated income statements and explanatory notes are based on the estimates and assumptions set forth in the explanatory notes.

 

            This pro-forma consolidated balance sheet and pro-forma consolidated income statements have been prepared utilizing the historical financial statements of Mobile Reach International, Inc. and Objective Spectrum, Inc. and should be read in conjunction with the historical financial statements and notes thereto included elsewhere in this filing.
 

            The pro-forma consolidated income statements have been prepared as if acquisitions had been consummated on August 1, 2004 under the purchase method of accounting and carried through to October 31, 2005.
The pro-forma consolidated balance sheet has been prepared as if the acquisition was consummated on October 31, 2005.
 

            This pro-forma consolidated financial data is provided for comparative purposes only, and does not purport to be indicative of the actual financial position or results of operations had the acquisition occurred at the beginning of the periods presented, nor are they necessarily indicative of the results of future operations.
 


 
MOBILE REACH INTERNATIONAL, INC. AND SUBSIDIARIES
PRO-FORMA CONSOLIDATED BALANCE SHEET
OCTOBER 31, 2005
(UNAUDITED)

 
Mobile Reach International, Inc. and
Subsidiaries
Objective Spectrum,
Inc.
Pro-Forma
Adjustments
 
Pro-Forma
 
 
 
 
 
 
ASSETS
 
 
 
 
 
CURRENT ASSETS:
 
 
 
 
 
Cash
19,157
774
 
-
  
 
19,931
Accounts receivable
147,172
    
-
      
-
  
 
  
147,172
Other current assets
         
450
    
- 
      
-
  
 
      
450
Total current assets
     
166,779
   
774
      
-
  
 
  
167,553
 
 
 
 
 
 
PROPERTY – Net
      
68,883
    
- 
      
-
  
 
   
68,883
 
 
 
 
 
 
 
$ 235,662
$ 774
 
-
  
 
$ 236,436
 
 
 
 
 
 
 
 
 
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
 
CURRENT LIABILTIES:
 
 
 
 
 
Accounts payable
379,523
2,043
-
  
 
381,566
Accrued expenses
832,656
65
      
-
  
 
  
832,721
Current portion long-term debt
      
70,663
   
 
-  
     
- 
 
   
70,663
Total current liabilities
   
1,282,842
  
2,108
     
- 
 
 
1,284,950
 
 
 
 
 
 
LONG-TERM DEBT
   
1,020,421
    
- 
     
- 
 
 
1,020,421
 
 
 
 
 
 
DEFERRED REVENUE
      
68,428
    
- 
      
- 
 
   
68,428
 
 
 
 
 
 
DEBENTURES
     
525,000
    
- 
     
- 
 
  
525,000
 
 
 
 
 
 
STOCKHOLDERS’ EQUITY:
 
 
 
 
 
Common stock
6,342,352
3,250
   
(3,250)
(1)
6,342,352
Retained earnings
  
(9,003,381
)
(4,584
)
   
3,250
(1)
(9,004,715
)
 
  
(2,661,029
)
(1,334
)
      
- 
 
(2,662,363
)
 
 
 
 
 
 
 
$ 235,662
$ 774
- 
 
$ 236,436
 
 
 
 
 
 
 
 
 


 
MOBILE REACH INTERNATIONAL, INC. AND SUBSIDIARIES
PRO-FORMA CONSOLIDATED INCOME STATEMENT
Three months ENDED October 31, 2005
(UNAUDITED)

 
Mobile Reach International, Inc. and
Subsidiaries
Objective Spectrum,
   Inc.  
 
Pro-Forma
Adjustments
 
 
Pro-Forma
 
 
 
 
 
 

 
 
 
 
 
 
REVENUE
$
   
155,941
 
$
    
-  
 
$
    
-  
 
 
$
 
155,941
 
 
 
 
 
 
 
COST AND EXPENSES:
 
 
 
 
 
Cost of goods sold
30,009 
-   
-   
 
30,009 
Warehouse expenses
-   
-   
-   
 
-   
Selling expenses
-   
-   
-   
 
-   
General and
 
 
 
 
 
 
administrative expenses
    
317,634 
   
  
460
 
     
-  
 
 
 
 
318,094
 
 
    
347,643
 
    
 
460
 
     
-  
 
 
   
348,103
 
 
 
 
 
 
 
OPERATING INCOME
(191,702)
(460)
      
-   
 
(192,162)
 
 
 
 
 
 
OTHER INCOME (EXPENSES)
    
(52,356
)
   
  
-  
 
     
-  
 
 
 
 
(52,356
)
 
 
 
 
 
 
NET LOSS
$
  
(244,058
)
$
   
(460
)
$
    
-  
 
 
$
(244,518
)
 
 
 
 
 
 
NET LOSS PER SHARE -
 
 
 
 
 
BASIC AND DILUTED
 
 
 
 
$
    
(0.08
)
 
 
 
 
 
 
WEIGHTED AVERAGE NUMBER
 
 
 
 
 
OF SHARES OUTSTANDING
 
 
 
 
3,119,373
 
 
 
 
 
 
 
 
 
 
 


 
MOBILE REACH INTERNATIONAL, INC. AND SUBSIDIARIES
PRO-FORMA CONSOLIDATED INCOME STATEMENT
YEAR ENDED JULY 31, 2005
(UNAUDITED)

 
 
Mobile Reach International, Inc. and
Subsidiaries
Objective Spectrum,
   Inc.  
 
Pro-Forma
Adjustments
 
 
Pro-Forma
 
 
 
 
 
 

 
 
 
 
 
 
REVENUE
607,374
 
-  
 
 
-  
 
 
607,374
 
 
 
 
 
 
 
COST AND EXPENSES:
 
 
 
 
 
Cost of goods sold
68,419 
-   
-   
 
68,419 
Warehouse expenses
-   
-   
-   
 
-   
Selling expenses
-   
-   
-   
 
-   
General and
 
 
 
 
 
 
administrative expenses
  
1,545,935
 
   
1,692
 
     
-  
 
 
1,547,627
 
 
  
1,614,354
 
   
1,692
 
     
-  
 
 
1,616,046
 
 
 
 
 
 
 
OPERATING INCOME
(1,006,980)
(1,692)
-   
 
(1,008,672)
 
 
 
 
 
 
OTHER INCOME (EXPENSES)
     
36,100
 
     
-  
 
     
-  
 
 
    
36,100
 
 
 
 
 
 
 
NET LOSS
$ (970,880
)
$ (1,692
)
$
    
-  
 
 
$ (972,572
)
 
 
 
 
 
 
NET LOSS PER SHARE -
 
 
 
 
 
BASIC AND DILUTED
 
 
 
 
$ (0.71
)
 
 
 
 
 
 
WEIGHTED AVERAGE NUMBER
 
 
 
 
 
OF SHARES OUTSTANDING
 
 
 
 
1,379,140
 
 
 
 
 
 
 
 
 


 
MOBILE REACH INTERNATIONAL, INC. AND SUBSIDIARIES
NOTES AND ASSUMPTIONS TO THE UNAUDITED CONSUMATED PRO-FORMA
BALANCE SHEET AND PRO-FORMA INCOME STATEMENTS
THREE MONTHS ENDED OCTOBER 31, 2005 and
Year ended July 31, 2005
 
 

ORGANIZATION AND BASIS OF PRESENTATION:
 

The unaudited pro-forma consolidated balance sheet and consolidated income statements have been based on historical financial information, using generally accounting principles in the
United States
, of MRI and OS for the three months ended October 31, 2005 and the fiscal year August 1, 2004 to July 31, 2005.
 

ASSUMPTION:
 

The number of shares used in the calculation of the pro-forma net loss per share data is based on the weighted average number of shares outstanding during the period adjusted to give effect to shares assumed to be issued, had the transactions referred to above been consummated August 1, 2004.
 
 

PRO-FORMA ADJUSMENTS:
 

Record the acquisition of OS by MRI.