LIQUIDITY AND CAPITAL RESOURCES
During the three months ended March 31, 2001 the Company had a net loss
from continuing operations of $(732,608) compared to $(92,272) in the prior
year. Cash used by operating activities of continuing operations was $(755,570)
during the three months ended March 31, 2001 compared to $(56,426) in the prior
year. The Company had working capital of $391,067 at March 31, 2001 compared to
$132,540 in the prior year. The increase in cash used by operating activities of
continuing operations during the three months ended March 31, 2001 compared to
the same period the prior year was primarily due to it's Myrtle Beach operation.
Investing activities used $75,500 during three months ended March 31,
2001 compared to $40,000 during the same period the prior year. The increase
resulted primarily from an increase in the level of spending for its wireless
(SWOMI) systems in the Myrtle Beach area.
Financing activities generated $581,000 during the three months ended
March 31, 2001 compared to $319,246 during the same period the prior year. The
increase primarily results from the sale of stock and loans from its major
shareholders.
The Company's short-term and long-term liquidity is primarily dependant
on its ability to continue its various capital raising along with the successful
implementation of its acquisition and expansion plans.
The Company has various ventures in the start up, acquisition and
developmental stages that should create a positive impact on the Company's
future financially.
On January 26, 2001, the Company purchased 55% of the outstanding stock
of GPS Integrators, Inc., a Texas corporation, which provides products to
improve winter operations at airports. Currently, GPS is selling equipment and
software associated with proprietary ice monitoring system used on airport
runways.
The purchase price of this acquisition was 2,000,000 shares of the
Company's restricted common stock. This stock, which was valued at $477,700, was
recorded at the stocks average simple traded value over a defined period less a
15% discount because of its restricted nature. Goodwill, amounting to $477,700
was recorded in connection with this transaction.
The Company believes that it's capital raising efforts will continue
successfully until it's operating segments (with the new ventures) begin to
generate a positive internal cash flow.
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