UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSBA
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT
OF 1934 FOR THE QUARTER ENDED March 31, 2001
Commission File Number 0-18094
UNIVERSAL EXPRESS, INC.
-----------------------
(Exact name of Registrant as specified in its charter)
NEVADA 11-2781803
---------------------------- -------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
1230 Avenue of the Americas, Suite 771
Rockefeller Center,
New York, N.Y. 10020
-------------------------------------------- -----------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 239-2575.
Securities registered pursuant to Section 12 (g) of the Act:
Common Stock
------------
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES X NO
----- -----
State the aggregate market value of the voting stock held by non-affiliates of
the registrant on March 31, 2001: $ 4,090,633
Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the latest practicable date.
--------------------------------------------------------------------------------
Common Stock Outstanding at March 31, 2001
--------------------------------------------------------------------------------
Class "A" 56,970,206
Class "B" 1,280,000
UNIVERSAL EXPRESS, INC.
INDEX
Page
Number
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheet 3
Consolidated Statements of Operations 4
Consolidated Statements of Cash Flows 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial 6-13
Condition or Plan of Operation
PART II - OTHER INFORMATION 13
SIGNATURE 14
UNIVERSAL EXPRESS, INC. AND SUBSIDIARIES
----------------------------------------
CONSOLIDATED BALANCE SHEET (UNAUDITED)
----------------------------------------
MARCH 31, 2001
--------------
ASSETS
------
CURRENT ASSETS:
Cash $ 16,167
Accounts receivable, net of allowance for doubtful
accounts of $107,600 42,349
Other receivable 200,000
----------
Total current assets 258,516
----------
PROPERTY AND EQUIPMENT, net 11,228
----------
OTHER ASSETS:
Goodwill, net 501,662
Related party receivables 532,824
Loan to officer 924,402
Other 137,541
----------
Total other assets 2,096,429
-----------
TOTAL ASSETS $ 2,366,173
===========
LIABILITIES AND STOCKHOLDERS' DEFICIENCY
CURRENT LIABILITIES:
Accounts payable $ 638,818
Accrued expenses 1,564,720
Payroll taxes payable 133,465
Notes payable 1,046,481
Other 89,861
Convertible debentures 189,000
-----------
Total current liabilities 3,662,345
-----------
STOCKHOLDERS' DEFICIENCY:
Common stock, $0.005 par value; authorized 147,000,000
shares, 56,970,207 shares issued, and outstanding 284,851
Class B common stock, $.005 part value; authorized
3,000,000 shares 1,280,000 shares issued and outstanding 6,400
Additional paid-in capital 26,398,261
Stock rights 678,227
Common stock in treasury, at cost, 40,000 shares (12,000)
Accumulated deficit (27,270,495)
Deferred compensation related to stock issued for services (1,381,416)
-----------
Total stockholders' deficiency (1,296,172)
-----------
$ 2,366,173
===========
See notes to consolidated financial statements.
3
UNIVERSAL EXPRESS, INC. AND SUBSIDIARIES
----------------------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
-------------------------------------------------
THREE AND NINE MONTHS ENDED MARCH 31, 2001 AND 2000
----------------------------------------------------
THREE MONTHS ENDED NINE MONTHS ENDED
------------------ -----------------
MARCH 31, MARCH 31,
--------------------- -------------------
2001 2000 2001 2000
---- ---- ---- ----
INCOME:
Ticket sales $ 244,902 $ 241,664 $1,172,827 $ 1,096,770
Delivery services - 212 1,305 102,803
-------- -------- ---------- ---------
TOTAL 244,902 241,876 1,174,132 1,199,573
-------- -------- ---------- ---------
COST AND EXPENSES:
Cost of goods sold 198,700 248,512 851,801 895,276
Selling, general and administration 541,919 772,128 1,742,043 2,344,231
Depreciation and amortization 13,555 49,298 40,059 176,419
-------- -------- ---------- ---------
TOTAL 754,174 1,069,938 2,633,903 3,415,926
-------- -------- ---------- ---------
LOSS FROM OPERATIONS (509,272) (828,062) (1,459,771) (2,216,353)
INTEREST EXPENSE (19,800) (3,423) (179,097) (7,713)
-------- -------- ---------- ---------
NET LOSS FROM CONTINUING OPERATIONS (529,072) (831,485) (1,638,868) (2,224,066)
--------- --------- ----------- -----------
DISCONTINUED OPERATIONS:
Loss from discontinued operations - (349,699) (398,994) (906,891)
Gain from disposal of discontinued operations 1,684,587 - 1,684,587 -
--------- --------- ----------- -----------
GAIN OR (LOSS) FROM DISCONTINUED OPERATIONS 1,684,587 (349,699) 1,285,593 (906,891)
---------- --------- ---------- -----------
NET INCOME (LOSS) $ 1,155,515 $ (1,181,184) $ (353,275) $ (3,130,957)
=========== ============= =========== =============
BASIC INCOME (LOSS) PER SHARE:
Continuing operations $ (0.01) $ (0.10) $ (0.04) $ (0.19)
Discontinued operations - (0.04) $ (0.01) (0.08)
Gain from discontinued operations 0.03 - $ 0.04 -
--------- --------- ----------- -----------
INCOME (LOSS) PER COMMON SHARE $ 0.02 $ (0.14) $ (0.01) $ (0.27)
======== ========= =========== ===========
WEIGHTED AVERAGE
COMMON SHARES OUTSTANDING 55,749,877 8,284,736 40,720,412 11,742,676
=========== ========== =========== ==========
See notes to consolidated financial statements.
4
UNIVERSAL EXPRESS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
NINE MONTHS ENDED MARCH 31, 2001 AND 2000
2001 2000
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss $ (353,275) $ (3,130,957)
--------- -----------
Adjustment to reconcile net loss to net cash (used in) provided by
operating activities:
Depreciation and Amortization 43,060 176,419
Amortization of deferred compensation 56,271 -
Common Stock issued for compensation 320,475 431,852
Common Stock issued in lieu of cash - 18,000
Loss from discontinued operations - 906,891
Gain from disposal of discontinued operations (1,684,587) -
Change in assets and liabilities:
Accounts receivable 27,473 (71,337)
Inventory - 23,916
Loan to officers (54,502) (37,350)
Other assets - (53,105)
Accounts payable and accrued expenses 553,602 260,275
Change in net assets & liabilities of discontinued operations 173,907 (840,963)
Other liabilities (34,502) 59,099
Taxes payable 7,987 4,429
------ -----
Total Adjustments (590,816) 878,126
--------- -------
NET CASH USED IN OPERATING ACTIVITIES (944,091) (2,252,831)
--------- -----------
CASH USED IN INVESTING ACTIVITIES
Purchase of property and equipment - (8,000)
Increase in related party receivable (182,565) (15,032)
Proceeds from sale of discontinued operations 200,000 -
-------- ----------
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES 17,435 (23,032)
-------- -----------
CASH FLOW FROM FINANCING ACTIVITIES
Sale of common stock 475,000 1,240,000
Repayments of notes and loans and payables - 60,000
Proceeds from Stock Rights 8,000 625,000
Proceeds from loans 439,000 518,750
-------- ----------
CASH PROVIDED BY FINANCING ACTIVITIES 922,000 2,443,750
-------- ----------
NET INCREASE(DECREASE) IN CASH (4,656) 167,887
CASH-Beginning of year 20,823 37,164
------- ------
CASH-End of period $ 16,167 $ 205,051
======= =======
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest $ 10,914 $ 7,713
======= =====
NON-CASH FINANICING AND INVESTING ACTIVITIES:
Conversion of debentures $ 810,000 $ -
============== ==============
Issuance of stock for accrued salaries $ 525,000 $ -
============== ==============
Issuance of stock for investment $ 120,000 $ -
============== ==============
See notes to consolidated financial statements.
5
UNIVERSAL EXPRESS, INC. AND SUBSIDIARIES
Notes To Financial Statements
(Unaudited)
1. Basis of Presentation
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial statements and with the instructions to Form 10-QSB. Accordingly, they
do not include all of the information and disclosures required for annual
financial statements. These financial statements should be read in conjunction
with the consolidated financial statements and related footnotes included in the
Company's annual report on Form 10-KSB for the year ended June 30, 2000.
In the opinion of the Company's management, all adjustments (consisting of
normal recurring accruals) necessary to present fairly the Company's financial
position as of March 31, 2001 and the results of operations and cash flow for
the nine-months ended March 31, 2001 have been included.
The results of operations for the nine-months ended March 31, 2001, are not
necessarily indicative of the results to be expected for the full year ended
June 30, 2001.
2. GOING CONCERN
The accompanying financial statements have been prepared assuming that the
company will continue as a going concern. The Company incurred a net loss from
continuing operations of approximately $1,639,000 for the nine months ended
March 31, 2001. Additionally, the Company had working capital and total capital
deficiencies of approximately $3,404,000 and $1,296,000 at March 31, 2001. These
conditions raise substantial doubt about the Company's ability to continue as a
going concern. Management's plans with respect to these matters include
restructuring its existing debt, raising additional capital through future
issuances of stock and or debentures. The accompanying financial statements do
not include any adjustments that might be necessary should the Company be unable
to continue as a going concern.
3. Sale of Skynet
In January 2001, the Company sold its 51% interest in Skyworld International
Couriers, Inc. ("Skynet") for the following consideration: $200,000 cash payable
by Skynet on February 27, 2001; $200,000 cash payable by Skynet in six monthly
installments of $30,000 each and one installment of $20,000, commencing on March
29, 2001; a service credit from Skynet in the sum of $700,000, use of which is
limited to $50,000 per month; Skynet's grant to the Company of a non-exclusive
license to grant sublicenses in the use of the trademark and tradename "Skynet"
in connection with international courier service for North America; agreement
between Skynet and the Company under which Skynet will provide the Company with
international courier service; and, the assumption of all of Skynet's
6
liabilities by the purchasers. In connection with the Company's above
discontinued operations, the accompanying financial statements have been
restated to present such business as discontinued operations for all periods
presented.
4. Loan
During the six months ended December 31, 2000, the Company obtained loans
aggregating $439,000 at 18% per annum.
5. Revised Financial Statements
The accompanying financial statements have been restated for an adjustment of
$524,691 to correct the understatement of selling, general and administrative
expenses of $498,750 pertaining to the cancellation of shares and $25,941 for
the cancellation of debt. In addition, interest expense increased by $168,903
principally from due to an agreement with the lender.
As As
Statement of Operations adjustments: Reported Adjustments Restated
Nine months ended March 31,2001
Operating expenses $ 2,109,212 $ 524,691 $ 2,633,903
Interest expense $ 10,194 $ 168,903 $ 179,097
Gain from disposal of
discontinued operations 1,517,555 167,032 1,684,587
Net income (loss) $ 173,287 $ 526,562 $ (353,275)
Weighted Average 40,720,412 - 40,720,412
Net loss per common share - $ (0.01) $ (0.01)
Three months ended March 31,2001
Operating expenses $ 675,424 $ 78,750 $754,174
Interest expense $ 1,844 $ 17,956 $ 19,800
Gain from disposal of
discontinued operations 1,517,555 167,032 1,684,587
Net income $ 1,085,189 $ 70,326 $ 1,155,515
Weighted Average 55,749,877 - 55,749,877
Net Income per common share basic $ .02 - $ .02
Item 2
MANAGEMENT DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION OR PLAN OF OPERATIONS
Included in this report are forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Although the Company believes that
the expectations reflected in such forward-looking statements are reasonable, it
can give no assurance that such expectations reflected in such forward-looking
statements will prove to be correct. The Company's actual results could differ
materially from those anticipated in the forward-looking statements as a result
of certain factors, including sales levels, distribution and competition trends
and other market factors.
7
The business of Universal Express, Inc.(The "Company") has, the Company
believes, stabilized after having undergone major transitions in recent years.
The Company's web site is www.usxp.com.
Although the Company sold Skynet, the Company believes it retained most of the
benefits sought by the Company upon its acquisition of Skynet in 1999, in terms
of the granting of licenses to the Company of the Skynet trademark for North
America, franchise territory rights, shipping credits and low international
shipping rates for its PBC member stores.
The Company believes that the value to the Company of the sale of its interest
in Skynet is approximately $3,000,000 in cash, services and franchise rights. In
addition, the Company expects to market its Skynet/Worldpost territory business
opportunity throughout North America. USXP has received $700,000 in shipping
service credits to pass on to its postal store members of its trade association
(pbc network.com).
The agreement between Skynet and the Company provides for cash, services,
franchise revenues and an international discounted shipping service to PBC
Network's postal store and consumer customers.
The Company believes this affords the Company the Skynet services with the
franchise revenue that will be made available to entrepreneurs. The Company
plans to further develop its programs along with now its renamed international
business opportunity - Worldpost.
Through its new partnership with Skynet, the Company's franchise and postal
store experience, the Company believes, should allow it to further penetrate
into the International shipping business of North America. Skynet is a 20-year
trade association of independently owned and operated local courier companies in
over 230 cities in 120 countries. Skynet's competitive rates coupled with being
the fifth largest international courier network sets the stage for the North
American expansion of the Skynet/WorldPost network through the efforts of the
Company.
The Company plans to price the first 2,000 territories at an average of $80,000
for each location. Training will be done in Miami, Florida and the Company
believes that potential market opportunities co-exist very nicely with the
territories presently occupied by PBC Network's private postal store members
throughout the United States. WorldPost territory partners can work closely with
the postal stores in their area.
The sale of these territories in North America by the Company and the royalty
income to the Company from this International shipping network as it penetrates
into North America will, the Company believes, enhance its net income and value
for the coming years. In addition, the Company believes that the cross over
values between the Company's two subsidiaries, PBC and WorldPost, should offer
many more perceived opportunities than those that existed before. The shipping
services provided by the WorldPost members will, the Company believes, provide
increased earnings for those members.
8
The Company believes its strategy of developing PBCNetwork is unique to the
private postal industry. The Company believes that PBCNetwork has established
itself as a provider of quality products and services that benefit the owners of
private postal businesses (see page 11).
The Company purchased its Entertainment division in 1997. The division consisted
mainly of: Downtown Theatre Ticket Agency, Inc., or Advance Entertainment (now
known as "Manhattan Concierge"), which provides theater, sports and special
events tickets and concierge services. These services are marketed through
toll-free phone numbers (1-888-NYSHOWS, 1-800-NYSHOWS AND 1-800-THE-SHOW) and
Manhattan Concierge's web site (www.manhattanconcierge.com).
Management continues to concentrate on the raising of new capital and focusing
on new ventures, including the PBC Network and WorldPost.
Management views this fiscal year as a period of anticipated growth based upon
the Company's decision to develop only core business through the PBC Network and
SkyNet/WorldPost.
The Company's principal subsidiaries and divisions include:
o The Postal Business Center Network.com
o Manhattan Concierge
o WorldPost Network.com
Private Postal Network.com and WorldPost.com
---------------------------------------------
On May 15, 1999, the name of the Association of Packagers and Carriers, APAC was
changed to the Private Postal Network.com (PPN), with two divisions, Postal
Business Center Network.com (PBC network.com) and an international shipping
division, WorldPost Network.com. In future reports, the names of these new
entities will be used to cover and describe the present functions and programs
of these networks as well as future programs and functions of this electronic
network of retail, mail, parcel, and business centers, which the Company
believes are positioned to provide goods and services needed to support
E-commerce, as well as the international shipping division, including support
from WorldPost.
Marketplace
-----------
A true global economy has surfaced and grown over the past decade. With
Internet, Catalog and Infomercial sales transcending all boundaries, an
inexpensive and responsive final mile Domestic and International delivery
network coupled with warehouse and shipping capabilities has been, the Company
believes, inexpensively created by the Company.
The business of the Company has undergone major changes in the last decade that
should, the Company believes, support its growing private postal network
utilizing the 20,000 postal retail stores doing $7 billion in sales. Strong
relationships are currently being established with E-commerce auction houses and
other manufacturers for quality assurance and localized shipping which the
Company believes will empower present and future PBC Network members.
9
Members of its Private Postal System (PBC Network) provide the public with a
complement to the U.S. Post Offices for many retail postal services. In
addition, these Postal Service Centers offer individuals and business customers
a variety of personal, business and communications services and even
merchandise.
Business
--------
Private postal and business service centers form a highly fragmented cottage
industry. The Company believes that this industry generates over $7 billion in
sales and presently consists of more than 20,000 independent operators. The
Company believes there is a market opportunity for the development of an
association with the goal of unifying and organizing independent and franchised
postal stores nationwide. PBC Network members are connected to other members and
to the PBC Network Headquarters via the PBC Web Site (PBCNetwork.com). The PBC
Web Site is utilized not only by members but also will be used in the future by
the general public. Only one PBC Network store per Zip Code has been
recommended, thus creating internal quality control standards.
As E-commerce and a global economy grow, someone must deliver the purchased
goods to the consumer. The Company believes that many companies will eventually
need an affordable distribution system to deliver nearly anything that the
customers purchase on-line.
The PBC Network is an association formed to create a long overdue and needed
profitable partnership between previously unconnected packaging store owners.
Similar in theory to the floral industry's FTD, the PBC Network provides
storeowners with a variety of cost-effective services and products to increase
their profitability; while they still maintain their local identities or
franchise loyalties. The PBC Network's goal is to provide consumers worldwide
with a feeling of branded quality assurance when they frequent a PBC Network
location.
SkyWorld International Couriers, Inc. is the U.S. member of the SkyNet Worldwide
Express Network, an alliance of independently owned and operated express courier
services operating in 268 cities in 120 countries. SkyWorld developed and owns
the SkyNet Trademark in the U.S. and most countries in Latin America. The SkyNet
Network provides global delivery and logistics service to multinational firms.
The Network currently delivers over 400,000 packages per month. It is the
world's largest independently owned courier network and the 5th largest express
courier network behind the integrated U.S. express carriers such as FedEx, UPS
and DHL.
Unlike the major integrators who operate their own aircraft and thus offer rigid
standardized pick up and delivery schedules, SkyNet Network members offer
flexible, customized International services to meet the clients' specific
distribution needs. Instead of operating its own fleet, SkyNet offers express
International air courier service and expedited air cargo through regularly
scheduled commercial airlines to transport time sensitive documents, parcels,
freight and mail. SkyNet provides on demand and scheduled pick up and delivery
10
courier and freight services in the U.S. and in foreign countries. SkyNet uses
available cargo and baggage space on scheduled passenger and cargo airlines
throughout the world. SkyNet operates its own facilities in Miami, New York, Los
Angeles, San Francisco, Venezuela and Costa Rica. Using licensees in most
countries in Latin America and the Caribbean, it provides 24 to 48 hour delivery
throughout the region. Hubs operated by SkyNet Network Members in London, Dubai,
Johannesburg, Brussels, Singapore and Sydney allow the swift delivery of
documents and parcels to almost any destination in the world within 72 hours.
The Company purchased and then one year later sold SkyWorld still retaining
discounted international rates for its members and customers along with the
coveted rights to sell territory business opportunities throughout North
America.
The strategic partnership with SkyNet Worldwide Express as part of the Company's
contracted International shipping network, also supports, the Company believes,
the PBC Network's postal store members needs. The strength of SkyNet
International's network is today primarily geared towards Central and South
America, although it has reciprocity delivery partners in 120 other countries
worldwide.
Universal Express' strategy of developing the PBC Network, a subsidiary of its
Private Postal Network (PPN) and SkyNet together is, the Company believes,
unique to the private postal industry. The PBC Network has established itself,
the Company believes, as a provider of quality products and services that
benefit all of the owners of private postal businesses. Private postal and
business centers previously formed a highly fragmented cottage industry within
the transportation industry.
These locations are individually owned and yet can create an inexpensive
localized International and domestic delivery network for themselves rather than
the traditional carriers that utilize these locations.
Revenue Sources
---------------
Our initial revenues sources, the Company believes, will combine SkyNet
Worldwide delivery and territory sales, along with our other subsidiaries. Based
upon marketing and branding monies, PBC's strategic alliances today include
numerous additional income sources:
International Shipping Internet Postage
Worldpost.com (SkyNet) E-Stamps
---------------------- ---------
Corrugated & Packaging Customized Corrugated
Packaging Technologies Cactus Corrugated
----------------------- ------------------
Lamination and Photo ID's Business and Office
D&K Laminex Supplies
------------ PBCNBizSupplies.com
--------------------
Customized Rubber Stamps Parcel Insurance
TheStampMaker.com Universal Parcel
---------------- ----------------
Insurance Co.
-------------
11
Equipment Leasing Credit Card rocessing
Advantage Leasing Nova Information Systems
----------------- ------------------------
Promotional Items Check Processing
International Promotion Group Echeck2000.com
----------------------------- ---------------
Key Machines and Supplies Payroll and Tax Processing
PayChex
LV Sales --------
--------
Discounted Phone Cards Video Conferencing
Saratoga Telecom Talk Visual
---------------- -----------
Secure Document Delivery Air Miles Incentive Program
American Airlines
NetEx ------------------
------
Moving Supplies Travel and Entertainment
Reslinx
All Boxes Direct --------
-----------------
Car Rental Shredder Cushioning Systems
Hertz Rent-A-Car Pac-Mate
---------------- ---------
Insurance
AFLAC Insurance
---------------
Competition
------------
The company further believes that the maturation of the PBC Network will
strengthen the profitable atmosphere of this cottage private postal industry.
Lack of financial strength and market penetration has prevented some excellent
franchisers and independent stores from properly promoting their services. The
ability of the PBC Network to create a nationally accepted private postal
industry that the American public will embrace and trust should re-create a
viable industry. The Company feels it can convince the independent and
nationwide franchisers that they must self-regulate for consumer acceptance and
seize this opportunity to become part of this new cooperative partnership within
the global economy.
Qualifications and Relationships
---------------------------------
The company's key people have years of experience in all aspects of delivery,
marketing and postal service related programs.
International Opportunity
-------------------------
The Company believes that opportunities to expand the scope of the PBC Network
and WorldPost are limitless due to shipping, distribution and growth of services
virtually throughout its market.
12
Results of Operations - Three and Nine Months
---------------------------------------------
Universal Express, Inc. (USXP), is an integrated business services conglomerate.
Its principal subsidiaries and divisions include the Private Postal Network.com
(with two divisions, Postal Business Center Network.com (PBC Network)and
WorldPost. Network.com)and Manhattan Concierge.
Revenues, principally from ticket sales, for the nine-month period
ended March 31, 2001 was $1,174,132 as compared to revenues of $1,199,573 for
the nine-month period ended March 31, 2000. The decrease is $25,441 or 2%.
Total operating expenses for the nine-month period ended March 31, 2001
were $2,633,903 as compared to total operating expenses of $3,415,926 for the
nine-month period ended March 31, 2000. The decrease of $782,023, or 23% for the
nine-month period is primarily attributable to the reduced administrative costs
due to office consolidations and decreased advisory costs. In addition, the
Company has incurred interest expense of $179,097 compared to $7,713 in the
prior year's nine month period.
Accordingly, the net loss from continuing operations for the nine-month period
ended March 31, 2001 was $1,638,868 as compared to a net loss of $2,224,066 for
the nine-month period ended March 31, 2000. In addition, a gain of $1,684,587
has been recognized from sale of the Company's Skynet subsidiary. Loss from
discontinued operations was $398,994 for the nine-months ended March 31, 2001.
Net loss from continuing operations was $529,072 for the three months
ended March 31, 2001 as compared to a net loss of $831,485 for the three months
ended March 31, 2000.
Ticket sales for Manhattan Concierge for the second quarter of 2001
were $244,902 as compared with $241,664 for the same period of 2000. Total
operating expense decreased approximately $316,000 for the comparable three
month period.
Liquidity and Capital Resources
---------------------------------
The Company had $16,167 cash at March 31, 2001 and a 3.4 million working capital
deficiency. The net proceeds from new loans to the Company were $439,000 and
$483,000 from the sale of common stock, all of which was used in its operating
activities except for $182,565 which was used for advances to related parties.
Until the PBC Network and WorldPost are fully operational, the Company faces a
situation whereby it needs to raise additional cash in the near future.
Management is continuing efforts to raise cash by arranging lines of credit and
obtaining additional equity. The Company's future business operation will
require additional capital.
Management continues to explore methods to increase working capital through debt
and additional equity infusions, as well as possible acquisitions.
13
PART II -- OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
The Company is involved in a small number of three lawsuits with vendors or
suppliers and claims for fees of certain professionals. The Company disputes of
all these claims. The Company believes that the disposition of these matters
will not have a material adverse effect on the Company's financial position.
Item 2. CHANGES IN SECURITIES -- NONE
---------------------
Item 3. DEFAULTS ON SENIOR SECURITIES -- NONE
-----------------------------
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS - NONE
---------------------------------------------------
Item 5. OTHER INFORMATION -- NONE
-------------------------
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
--------------------------------
None
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
UNIVERSAL EXPRESS, INC.
/s/Richard A. Altomare
---------------------------
Richard A. Altomare,
President and Chairman
Of the Board.
Dated: October 24, 2001
14