Liquidity, Financial Condition and Management's Plans
|6 Months Ended|
Jun. 30, 2018
|Liquidity, Financial Condition and Management's Plans [Abstract]|
|Liquidity, Financial Condition and Management's Plans||
2. Liquidity, Financial Condition and Management’s Plans
At June 30, 2018, the Company’s principal sources of liquidity were its cash and cash equivalents and the net proceeds from the sales of shares of common stock in the first six months of 2018.
The Company had an accumulated deficit of approximately $73,796,000 at June 30, 2018. During the six months ended June 30, 2018, the Company generated a net loss from continuing operations of approximately $3,665,000, used cash in continuing operations of approximately $3,226,000, and the Company expects that it will continue to generate operating losses for the foreseeable future. At June 30, 2018, the Company had a cash balance of approximately $2,667,000. Total revenues were approximately $2,119,000 and $3,659,000 for the three months ended June 30, 2018 and 2017, respectively, and approximately $4,432,000 and $7,570,000 for the six months ended June 30, 2018 and 2017, respectively. The Company had working deficit of approximately $692,000 and $1,140,000 at June 30, 2018 and December 31, 2017, respectively.
The Company is closely monitoring operating costs and capital requirements and has developed an operating plan for 2018. Management of the Company also made efforts in 2017 and first half of 2018 to contain and reduce cost, including implementing a new approval process over travel and other expenses, significantly reducing the cash compensation for independent board directors, terminating non-performing employees and eliminating certain positions, and replacing and negotiating with certain vendors. We also sold certain assets of our Noble Voice business on May 25, 2018 to reduce operating losses and cash burns. If we are not successful in sufficiently reducing our costs, we may then need to dispose of certain of our assets or discontinue certain business lines.
On January 29, 2018, the Company sold 380,295 shares of common stock at a price of $3.91 per share for gross proceeds of $1,486,953. The per share purchase price reflected the closing price of the Company’s shares of common stock on January 24, 2018. The purchaser is Mr. Shengqi Cai, an individual and a resident of the People’s Republic of China.
On June 25, 2018, the Company sold 496,510 shares of common stock at a price of $2.89 per share for gross proceeds of $1,434,914. The purchaser is China EWI International Finance Group Co., Limited, a limited liability company based in the People’s Republic of China.
Management believes that its available funds will be sufficient to meet its working capital requirements through August 2019. However, there can be no assurances that the plans and actions proposed by management will be successful, that the Company will generate anticipated revenues, or that unforeseen circumstances will not require additional funding sources in the future or effectuate plans to conserve liquidity. Future efforts to raise additional funds may not be successful or they may not be available on acceptable terms, if at all. Due to China’s foreign currency control, the Company cannot move money between China and the U.S. freely. The People’s Bank of China (PBOC) and State Administration of Foreign Exchange (SAFE) regulate the flow of foreign exchange in and out of the country. We need to get approval from the Chinese government to move money from China to the U.S. which might take extra time. As of June 30, 2018 we had $2,732,000 cash balance in China.
The entire disclosure relating to liquidity, financial condition, and management's plans.
No definition available.