Gasp... ABFG says that despite all those "phenomenal" webcasts where they had to increase bandwidth to keep up with demand that they haven't produced any meaningful revenue!
B. Organization
As of December 31, 1999, the Company was considered to be in the development stage of operations. According to the Financial Accounting Standards Board of the Financial Accounting Foundation, a development stage company is defined as a company that devotes most of its activities to establishing a new business activity. In addition, planned principle activities have not commenced, or have commenced and have not yet produced significant revenue. FAS-7 requires that all development costs be expensed during the development period. The Company expensed $4,030,099 of development costs for the twenty-seven months ended December 31, 1999.
AMERICAN BENEFITS GROUP, INC. AND SUBSIDIARIES
(DEVELOPMENT STAGE COMPANIES)
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1999
(UNAUDITED)
ASSETS
<TABLE>
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 360
Accounts receivable 6,132
Refundable taxes 30,125
Inventories 6,128,090
---------------
TOTAL CURRENT ASSETS $ 6,164,707
PROPERTY AND EQUIPMENT 204,961
OTHER LONG-TERM ASSETS
Unamortized mining perimeters 4,332,041
OTHER ASSETS
Investment in joint venture - Total Gem Management 17,300
Deposits 76,874
---------------
TOTAL OTHER ASSETS 94,174
-----------
TOTAL ASSETS $10,795,883
===========
</TABLE>
<PAGE>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable
Inventory - Menavi Group $ 2,600,000
Trade 630,548
Related entities 797,070
-----------
TOTAL CURRENT LIABILITIES $ 4,027,618
MINORITY INTEREST DEFICIENCY (6,807)
SHAREHOLDERS' EQUITY
Preferred stock
Par value - $10 per share
Authorized - 10,000,000 shares
No shares are issued or outstanding
Common stock
No par value
Authorized 200,000,000 shares
Issued and outstanding - 53,824,075 shares 8,418,563
Cumulative currency translation adjustment 6,634
Retained earnings (deficit) (372,194)
Deficit accumulated during the development
stage (1,277,931)
-----------
TOTAL SHAREHOLDERS' EQUITY 6,775,072
------------
TOTAL LIABILITIES AND SHAREHOLDERS'
EQUITY $ 10,795,883
============
See Accompanying Notes and Independent Accountants' Review Report.
2
<PAGE>
AMERICAN BENEFITS GROUP, INC. AND SUBSIDIARIES
(DEVELOPMENT STAGE COMPANIES)
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS)
FOR THE SIX MONTHS ENDED DECEMBER 31, 1999 AND
FOR THE PERIOD JULY 1, 1997 (DATE OF DEVELOPMENT STAGE)
TO DECEMBER 31, 1999
(UNAUDITED)
July 1, 1997
(Date of
Six Months Development
Ended Stage) to
December 31, 1999 December 31, 1999
----------------- -----------------
NET (LOSS) $ (514,675) $ (1,277,931)
OTHER COMPREHENSIVE INCOME
Foreign currency translation adjustments (9,390) 6,634
------------ ------------
NET COMPREHENSIVE (LOSS) $ (524,065) $ (1,271,297)
============ ============
NET (LOSS) PER COMMON SHARE
Basic and diluted $ (.01)
============
AVERAGE NUMBER OF COMMON SHARES
OUTSTANDING
Basic and diluted 52,774,075
============
See Accompanying Notes and Independent Accountants' Review Report.
3
<PAGE>
AMERICAN BENEFITS GROUP, INC. AND SUBSIDIARIES
(DEVELOPMENT STAGE COMPANIES)
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED DECEMBER 31, 1999 AND
FOR THE PERIOD JULY 1, 1997 (DATE OF DEVELOPMENT STAGE)
TO DECEMBER 31, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
July 1, 1997
(Date of
Six Months (Development)
Ended Stage) to
December 31, 1999 December 31, 1999
----------------- -----------------
<S> <C> <C>
REVENUE - SALE OF GEMS FROM TESTING $ 27,706 $ 5,068,207
----------- -----------
COST AND EXPENSES
Purchases, commissions and fees for test gems 17,917 1,800,549
Development costs 524,464 4,552,400
----------- -----------
TOTAL COST AND EXPENSES 542,381 6,352,949
----------- -----------
NET (LOSS) BEFORE MINORITY INTERESTS (514,675) (1,284,742)
MINORITY INTEREST IN LOSS OF
CONSOLIDATED SUBSIDIARY 0 6,811
----------- -----------
NET (LOSS) $ (514,675) $(1,277,931)
=========== ===========
</TABLE>
See Accompanying Notes and Independent Accountants' Review Report.
4
<PAGE>
AMERICAN BENEFITS GROUP, INC. AND SUBSIDIARIES
(DEVELOPMENT STAGE COMPANIES)
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED DECEMBER 31, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
Preferred Stock Common Stock Additional
-------------------------- --------------------------- Paid in
Shares Amount Shares Amount Capital
------ ------ ------ ------ ---------------
<S> <C> <C> <C> <C> <C>
BALANCE, JULY 1, 1997 1,683,000 $ 1,683 $ 475,750
CHANGE IN PAR VALUE 475,750 (475,750)
ISSUANCE OF COMMON
STOCK FOR CASH 3,300,000 60,000
ISSUANCE OF
COMMON STOCK FOR
ACQUISITION OF 90%
OF SAOWANI
DEVELOPMENT S.A.R.L.,
AT BOOK VALUE OF
SUBSIDIARY 3,000,000 36
REPAYMENT OF
SHAREHOLDER'S
RECEIVABLE
STOCK DIVIDEND 15,966,000
CUMULATIVE CURRENCY
TRANSLATION
ADJUSTMENT
ISSUANCE OF COMMON
STOCK FOR 70% OF WORLD
GEMS CORPORATION S.A.R.L. 1,000,000 1,000
NET (LOSS) FOR THE SIX
MONTHS ENDED
DECEMBER 31, 1998
------------- ------------ ----------- ------------ ---------------
BALANCE,
DECEMBER 31, 1998 0 0 24,949,000 538,469 0
</TABLE>
See Accompanying Notes and Independent Accountants' Review Report.
<PAGE>
AMERICAN BENEFITS GROUP, INC. AND SUBSIDIARIES
(DEVELOPMENT STAGE COMPANIES)
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED DECEMBER 31, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
Deficit
Cumulative Accumulated Total
Currency Retained During the Shareholders'
Translation Earnings Development Shareholder Equity
Adjustment (Deficit) Stage Receivable (Deficit)
---------------- ----------------- ---------------- --------------- -------------
<S> <C> <C> <C> <C> <C>
BALANCE, JULY 1, 1997 $ 0 $ (353,788) $ 0 $ (95,000) $ 28,645
CHANGE IN PAR VALUE
ISSUANCE OF COMMON
STOCK FOR CASH
60,000
ISSUANCE OF
COMMON STOCK FOR
ACQUISITION OF 90%
OF SAOWANI
DEVELOPMENT S.A.R.L.,
AT BOOK VALUE OF
SUBSIDIARY 36
REPAYMENT OF
SHAREHOLDER'S
RECEIVABLE 95,000 95,000
STOCK DIVIDEND
CUMULATIVE CURRENCY
TRANSLATION
ADJUSTMENT 3,860 3,860
ISSUANCE OF COMMON
STOCK FOR 70% OF WORLD
GEMS CORPORATION S.A.R.L. 1,000
NET (LOSS) FOR THE SIX
MONTHS ENDED
DECEMBER 31, 1998 (18,406) (620,244) (638,650)
---------------- ----------------- ----------------- --------------- -----------------
BALANCE,
DECEMBER 31, 1998 3,860 (372,194) (620,244) 0 (450,109)
</TABLE>
See Accompanying Notes and Independent Accountants' Review Report.
5
<PAGE>
AMERICAN BENEFITS GROUP, INC. AND SUBSIDIARIES
(DEVELOPMENT STAGE COMPANIES)
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY(CONTINUED)
FOR THE SIX MONTHS ENDED DECEMBER 31, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
Preferred Stock Common Stock
-------------------------- ---------------------------
Shares Amount Shares Amount
------ ------ ------ ------
<S> <C> <C> <C> <C>
CUMULATIVE CURRENCY
TRANSLATION
ADJUSTMENT $ $
ISSUANCE OF COMMON
STOCK FOR
CASH 6,477,075 1,134,423
SHAREHOLDER'S LOANS 5,358,000 416,100
SERVICES 10,795,000 2,768,702
DEPOSIT ON EQUIPMENT 23,000 23,055
ACQUISITION OF STONES
AND WOOD CORPO-
RATION S.A.R.L. 4,997,000 3,500,000
LESS COSTS TO ACQUIRE
FINANCING (39,621)
NET (LOSS) FOR YEAR
ENDED JUNE 30, 1999
------------- ------------- ---------- -------------
BALANCE, JUNE 30, 1999 0 0 52,599,075 8,341,128
ISSUANCE OF COMMON
STOCK FOR SERVICES 1,225,000 77,435
CUMULATIVE CURRENCY
TRANSLATION
ADJUSTMENT
NET (LOSS) FOR THE
SIX MONTHS ENDED
DECEMBER 31, 1999
------------- ------------- ---------- -------------
BALANCE,
DECEMBER 31, 1999 0 $ 0 53,824,075 $ 8,418,563
============= ============= ========== =============
</TABLE>
See Accompanying Notes and Independent Accountants' Review Report.
<PAGE>
AMERICAN BENEFITS GROUP, INC. AND SUBSIDIARIES
(DEVELOPMENT STAGE COMPANIES)
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY(CONTINUED)
FOR THE SIX MONTHS ENDED DECEMBER 31, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
Deficit
Cumulative Accumulated
Additional Currency Retained During the
Paid in Translation Earnings Development
Capital Adjustment (Deficit) Stage
--------------- ---------------- ---------------- --------------
<S> <C> <C> <C> <C>
CUMULATIVE CURRENCY $ $ 12,164 $ $
TRANSLATION
ADJUSTMENT
ISSUANCE OF COMMON
STOCK FOR
CASH
SHAREHOLDER'S LOANS
SERVICES
DEPOSIT ON EQUIPMENT
ACQUISITION OF STONES
AND WOOD CORPO-
RATION S.A.R.L.
LESS COSTS TO ACQUIRE
FINANCING
NET (LOSS) FOR YEAR
ENDED JUNE 30, 1999 (143,012)
--------------- ---------------- ---------------- --------------
BALANCE, JUNE 30, 1999 0 16,024 (372,194) (763,256)
ISSUANCE OF COMMON
STOCK FOR SERVICES
CUMULATIVE CURRENCY
TRANSLATION
ADJUSTMENT (9,390)
NET (LOSS) FOR THE
SIX MONTHS ENDED
DECEMBER 31, 1999 (514,675)
--------------- ---------------- ---------------- --------------
BALANCE,
DECEMBER 31, 1999 $ 0 $ 6,634 $ (372,194) $ (1,277,931)
=============== ================ ================ ==============
</TABLE>
See Accompanying Notes and Independent Accountants' Review Report.
<PAGE>
AMERICAN BENEFITS GROUP, INC. AND SUBSIDIARIES
(DEVELOPMENT STAGE COMPANIES)
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY(CONTINUED)
FOR THE SIX MONTHS ENDED DECEMBER 31, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
Total
Shareholders'
Shareholder Equity
Receivable (Deficit)
--------------- -----------------
<S> <C> <C>
CUMULATIVE CURRENCY $ $ 12,164
TRANSLATION
ADJUSTMENT
ISSUANCE OF COMMON
STOCK FOR
CASH 1,134,423
SHAREHOLDER'S LOANS 416,100
SERVICES 2,768,702
DEPOSIT ON EQUIPMENT 23,055
ACQUISITION OF STONES
AND WOOD CORPO-
RATION S.A.R.L. 3,500,000
LESS COSTS TO ACQUIRE
FINANCING (39,621)
NET (LOSS) FOR YEAR
ENDED JUNE 30, 1999 (143,012)
--------------- -----------------
BALANCE, JUNE 30, 1999 0 7,221
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