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Microcap & Penny Stocks : AMGV - David and Goliath of the box makers? -- Ignore unavailable to you. Want to Upgrade?

To: JohnO who wrote (441)	10/27/1998 1:30:00 PM
From: JohnO	Read Replies (1) \| Respond to of 509

October 27, 1998 AMERICAN GENERAL VENTURES INC (AMGV) Quarterly Report (SEC form 10QSB) - MANAGEMENT DISCUSSION AND ANALYSIS Results of Operations During the period from July 1, 1998 through September 30, 1998 the Company revenues were $385,961 compared with $109,385 for the same period in 1997. The increase in revenues was due to the Company's subsidiary ACI Micro Systems, Inc. restructuring its strategy by concentrating on online sales. In addition to selling its products through Wal-Mart Online, the Company developed its own web site offering its branded computers at extremely competitive price points. The combination of sales through Wal-Mart Online and the Company's web site increased it computer sales by more than 350 percent. Net income for this period was $35,856 compared to a loss of ($50,401) for the same period in 1997. The increase in income was due to the increase in sales generated through Wal-Mart Online and the Company's web site. During this current period Wal-Mart Online introduced the Company's build to order (BTO) computer. The BTO accounted for an eighty percent increase in sales generated by Wal-Mart Online. The increase in profits was also due to the Company reducing its costs incurred by returns from Wal-Mart retail outlets. The company's strategy of marketing its product solely through the internet has proven effective in reducing returns. The Company's sales through its own web site were nearly sixty percent of its revenues. The Company's success in online sales is directly correlated to its banner ads that ran on Hotmail, the world's largest free e-mail company that was recently acquired by Microsoft. The Company continues to use Hotmail to advertise its products, but plans to expand its banner ads on additional web site promoters and expects that the additional exposure will result in increased revenues and profits. Working Capital and Capital Resources Working capital at September 30, 1998 (current assets less current liabilities) totaled $8,834 compared to $163,634 at June 30, 1997. The decrease in working capital was due to a decrease in inventory and an increase in short term debt to its President Steven H. Walker. In 1997, Dr. Walker converted $500,000 of the Company's debt owed to him to equity. He accepted the Company's common stock at $1.00 per share to reduce the debt. In 1998, Dr. Walker deferred his salary and loaned the company additional funds to pay off debts owed to vendors reducing the Company's accounts payable to vendors by more than $80,000. The Company has adopted a "just in time" method of inventory that has resulted in the need for using capital to purchase products before they are sold. This strategy allows the Company to increase its cash position and reduces the cost of inventory that depreciates rapidly in the computer industry. The Company has determined that its working capital is sufficient to continue operations and that no significant adjustments were necessary during this current quarter.