Third thing that caught my eye.
For the couple of years ANC has had a very bad cash crunch. At the start of 1998 the company had a working capital deficit of $1,133,205 and only one real money making piece of software. It is no wonder that the stock traded down to the .10-.07 range for a while and kept investors away for fears of a rollback or bankruptcy.
However this has all changed as of the last quarter. As of Nov 30, 1998 (last financial report) the company had cash of 1,377,905 and accounts receivable of 492,253. In the year end report (March 2 1999) they mention that 100% of the cash receivables have been collected giving them a cash balance of $1,870,000. They also have an additional $700,000 in listed assets.
The cash crunch has really made these guys clean up their act and tighten up their business.
In 1998 expenses decreased 34.3% over 1997. They also outsourced there technical support for SmartWare to a third party since it wasn't their cash cow software.
As of Nov 30, 1998 they had $2,368,000 in liabilities. However this dept. is being handled very well in my opinion. Of this liability $167,000 has since been repaid and $490,000 is being converted to shares (see News March 24 1999). Bring this number down to $1,711,000.
Out of this liability they have $419,661 in royalties and license fees payments due. However from the March 26 1999 annual report "as of Nov 30, 1998 the corporation has accured the maximum amounts owing to firstmark and no further royalties will accure to Firstmark on the sale of KnowledgeSEEKER". This means they will not have to pay anymore royalities on their main software which will boost gross margin.
The only really liability at this point is $900,000 for accounts payable and accured liabilities. They have been paying this off steadily for the past 3 years and have reduced this amount by 13% since last year.
From a asset/liabilites standpoint this company is in the best situation it has been in for years. However that is only a small piece of the puzzle.
Best Regards
KEITH
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