EXHIBIT 99.3
LOTUS PACIFIC, INC.
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1998
(Unaudited)
ASSETS
Lotus Pacific Pro Forma
Inc. Acquisitions Adjustments Totals
------------------- --------------- ------------- ------------
Current assets:
Cash......................... $ 894,811 $ 135,417 $ 1,030,228
Cash - segregated............ 3,277,838 3,277,838
Accounts receivable.......... 10,535,359 84,627 10,619,986
Receivables from broker/dealers 13,478,805 13,478,805
Securities owned............. 18,521,542 18,521,542
Inventory.................... 13,650 13,650
Other........................ 9,036 73,846 82,882
------------- ------------ ------------
Total current assets........ 11,452,856 35,572,075 47,024,931
------------- ------------ -----------
Property and equipment:
Furniture and office equipment 92,147 452,849 544,996
Equipment..................... 1,540,222 1,540,222
Leasehold improvements........ 1,041 1,041
------------- ------------- ------------
1,633,410 452,849 2,086,259
Less: accumulated depreciation (512,154) (222,840) (734,994)
------------- -------------- ------------
1,121,256 230,009 1,351,265
------------- -------------- ----------
Other assets:
Intangible asset, net of
accumulated amortization..... 5,000,915 1,035 5,001,950
Goodwill, net of accumulated
amortization................. 25,977,016 $8,611,222 34,588,238
Deposits...................... 22,175 14,536 36,711
Deposits with clearing organizations 1,396,210 1,396,210
Other assets.................. 701,897 701,897
------------- -------------- ------------- -----------
31,000,106 2,113,678 8,611,222 41,725,006
------------- ------------- ----------- -----------
$43,574,218 $37,915,762 $8,611,222 $90,101,202
============ ============ ========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and
accrued expenses............. $ 4,017,632 $ 761,634 $ 4,779,266
Payable to brokers, dealers
and customers................ 31,195,998 31,195,998
Liabilities subject to claims. 710,000 710,000
------------- ------------- ------------
Total current liabilities.... 4,017,632 32,667,632 36,685,264
------------- ------------ ------------
Minority interest in subsidiary 6,062,483 6,062,483
------------- -----------
Commitments
Stockholders' equity:
Common stock.................. 47,499 643 48,142
Preferred stock, Series A..... 4 4
Common stock warrants......... 80,000 80,000
Additional paid-in capital.... 38,451,042 5,247,487 $10,879,819 54,578,348
Deficit....................... (5,084,442) (2,268,597) (7,353,039)
------------- ------------- -------------- -----------
33,494,103 5,248,130 8,611,222 47,353,455
------------- ------------- -------------- -----------
$43,574,218 $37,915,762 $ 8,611,222 $90,101,202
============= ============= ============= ===========
The following unaudited pro forma information represents the results of
operations for the year ended June 30, 1998 of the Company as if the
acquisitions of Professional Market Brokerage, Inc. and U.S. Securities &
Futures Corp. had taken place on July 1, 1997. These pro forma results of
operations have been prepared for comparative purposes only and do not purport
to be indicative of the results of operations which actually would have
resulted had the acquisitions occurred on the date indicated, or which may
result in the future.
The figures include amortization of goodwill as if the acquisitions had taken
place on July 1, 1998, and amounted to $906,444.
LOTUS PACIFIC, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED JUNE 30, 1998
(Unaudited)
Lotus Pacific Pro Forma
Inc. Acquisitions Adjustments Totals
----------------- ---------------- ------------- ------------
Sales............................. $6,159,000 $ 6,159,000
Cost of sales..................... 3,412,500 3,412,500
----------- -----------
Gross profit...................... 2,746,500 2,746,500
----------- -----------
Commission income................. $19,142,319 19,142,319
Royalty income.................... 1,800,000 1,800,000
Trading gain - realized........... 268,832 268,832
------------ ------------- -----------
1,800,000 19,411,151 21,211,151
----------- ----------- -----------
Operating expenses:
Selling, general and
administrative expenses........ 8,794,938 19,620,049 $ 906,444 29,321,431
Research and development......... 2,264,801 2,264,801
------------ ------------ ----------- -----------
11,059,739 19,620,049 906,444 31,586,232
------------ ----------- ----------- -----------
Operating loss.................... (6,513,239) (208,898) (906,444) (7,628,581)
----------- ----------- ----------- -----------
Other income (expense):
Interest income.................. 30,475 686,382 716,857
Other income..................... 3,073 203,255 206,328
------------ ------------ -----------
33,548 889,637 923,185
----------- ---------- ----------
Net loss before income taxes,
minority interest in income of
consolidated subsidiaries and
discontinued operations......... (6,479,691) 680,739 (906,444) (6,705,396)
Income tax benefit................ 122,824 71,827 194,651
Minority interest in loss of
consolidated subsidiaries........ 318,200 318,200
Loss from discontinued operations. (565,916) (565,916)
------------ ----------- ------------ ------------
Income (loss) .................... $(6,604,583) $ 752,566 $(906,444) $(6,758,461)
============ ============= ============ =============
Income (Loss) per share:
Basic............................ $ (.14) $ .02 $ (.02) $ (.14)
============== ============= ============ =============
The following unaudited pro forma information represents the results of
operations for the six months ended December 31, 1998 of the Company as if the
acquisitions of Professional Market Brokerage, Inc. and U.S. Securities
& Futures Corp. had taken place on July 1, 1998. These pro forma results of
operations have been prepared for comparative purposes only and do not purport
to be indicative of the results of operations which actually would have
resulted had the acquisitions occurred on the date indicated, or which may
result in the future.
The figures include amortization of goodwill as if the acquisitions had taken
place on July 1, 1998, and amounted to $453,222.
LOTUS PACIFIC, INC.
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED DECEMBER 31, 1998
(Unaudited)
Lotus Pacific Pro Forma
Inc. Acquisitions Adjustments Totals
---------------- --------------- -------------- -----------
Sales.......................... $8,846,693 $ 8,846,693
Cost of sales.................. 7,227,033 7,227,033
------------ -----------
Gross profit................... 1,619,660 1,619,660
------------ -----------
Commission income.............. $10,720,588 10,720,588
Royalty income................. 124,125 124,125
Trading gain - realized........ 19,771 19,771
Trading loss - unrealized...... (1,253,173) (1,253,173)
------------- ------------- ------------
124,125 9,487,186 9,611,311
------------ ------------ ------------
Operating expenses:
Selling, general and
administrative expenses..... 2,667,840 11,792,738 $ 453,222 14,913,800
Research and development...... 1,049,738 1,049,738
------------- ------------ ------------ -----------
3,717,578 11,792,738 453,222 15,963,538
------------ ------------ ----------- -----------
Operating loss................. (1,973,793) (2,305,552) (453,222) (4,732,567)
------------ ------------ ----------- -----------
Other income (expense):
Interest income............... 13,440 434,997 448,437
Interest expense.............. (25,492) (25,492)
Other income.................. 114,160 114,160
Foreign exchange loss......... (54,042) (54,042)
-------------- ------------- -----------
13,440 469,623 483,063
------------- ------------- ----------
Net loss before income taxes,
minority interest in income of
consolidated subsidiaries and
discontinued operations....... (1,960,353) (1,835,929) (453,222) (4,249,504)
Income tax benefit............. 20,554 20,554
Minority interest in loss of
consolidated subsidiaries..... 66,836 66,836
Loss from discontinued operations (53,017) (53,017)
Loss on sale of subsidiaries... (590,641) (590,641)
------------- ------------ -------------- -----------
Income (loss).................. $(2,537,175) $(1,815,375) $(453,222) $(4,805,772)
============= ============ ============= ============
Income (Loss) per share:
Basic......................... $ (.06) $ (.04) $ (.02) $ (.12)
============= ============== ============= ===========