MSGI appears to be standing on shaky financial ground. For the nine months ended March 30, the company posted a net loss of $4 million, or $1.22 a share, compared with a loss of $2.1 million, or 95 cents, in the same period a year earlier. And more than half that loss, or $2.2 million, came in the March quarter alone. Revenue for the three months and nine months ended March 30 was $345,500 and $496,500, respectively. The company posted no sales for the nine months ended March 30, 2004. At the end of March the company had $1.8 million in cash and was burning through an average of $86,500 per month.
According to an April 22 filing with the Securities and Exchange Commission, the company said the SEC had requested detailed disclosures about management's analysis of its financial condition, capital resources and liquidity controls. Because of this, the company needs to revise its cash flow statements for the fiscal years ended June 30, 2002, 2003 and 2004.
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