City Network Announces Expected Date for Filing of September 30, 2006 Quarterly Financials and Brief Update of Current Company Financials.TAIPEI Taipei (tībā`), city (1995 est. pop. 2,632,863), N Taiwan, capital of Taiwan and provisional capital of the Republic of China. Taiwan's largest city, it is the administrative, cultural, and industrial center of the island. , Taiwan Taiwan (tī`wän`), Portuguese Formosa, officially Republic of China, island nation (2005 est. pop. 22,894,000), 13,885 sq mi (35,961 sq km), in the Pacific Ocean, separated from the mainland of S China by the 100-mi-wide (161-km) Taiwan -- City Network, Inc. (Amex: CSN CSN Crosby, Stills, and Nash (band) CSN Centrala studiestödsnämnden (Swedish: state education grant and loan program) CSN Confédération des Syndicats Nationaux (French) ), a company that designs, manufactures, and markets a comprehensive line of broadband broadband Term describing the radiation from a source that produces a broad, continuous spectrum of frequencies (contrasted with a laser, which produces a single frequency or very narrow range of frequencies). and wireless Internet access See how to access the Internet. solutions and consumer electronic products, announced that it will not file its Quarterly Report on Form 10-QSB for the quarter ended September September: see month. 30, 2006 by the required filing date. The Company previously filed with the Securities and Exchange Commission a notification of late filing indicating that it will be making a late filing for its Quarterly Report on Form 10-QSB for such fiscal quarter. Chairman Alice Alice, city (1990 pop. 19,788), seat of Jim Wells co., S Tex.; inc. 1910. Long a cow town at a railroad junction, Alice remains a cattle-shipping center. Oil and natural gas are also important to its economy. Manufactures include office equipment and fishing tools. Chen has announced the Company has set the formal submission Submission Elliott, Anne reluctantly gives up her fiancé on her family’s advice. [Br. Lit.: Jane Austen Persuasion in Magill I, 734] of such financial data to the Securities and Exchange Commission within one calendar week. The Company has committed to schedule the filing for the fiscal quarter ended September 30, 2006 on Wednesday Wednesday: see week. , November November: see month. 29, 2006. The filing is being delayed as a result of management's ongoing evaluation of the Company's internal control over financial reporting for the quarter ended September 30, 2006. The basic financial information for the quarter ended September 30, 2006 is as follows: RESULTS OF OPERATIONS THREE MONTHS ENDED SEPTEMBER 30, 2006 COMPARED WITH THREE MONTHS ENDED SEPTEMBER 30, 2005 NET SALES Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight . Net sales for the three months ended September 30, 2006 were $1,394,624 compared to $3,784,392 for the three months ended September 30, 2005. The decrease in net sales for the three months ended September 30, 2006 was due to a decrease in demand for our old products and low demand for our new products . COST OF SALES. Cost of sales for the three months ended September 30, 2006 was $1,402,975 or 100.6% of net sales, as compared to $3,427,726 or 90.6% of net sales, during the three months ended September 30, 2005. The decrease was due to the decrease of net sales. The increase in the cost of sales as a percentage of revenue was due to decreased sales of higher-margin products and sale of inventory. GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses were $1,397,046 or 100.2% of net sales, for the three months ended September 30, 2006, as compared to $508,376 or 13.4% of net sales, for the three months ended September 30, 2005. The increase in general and administrative expenses and in general and administrative expenses as a percentage of net sales was due to an increase in bad debt expense. LOSS FROM OPERATIONS. Loss from operations for the three months ended September 30, 2006 was $(1,405,397), compared to loss from operations for the three months ended September 30, 2005 of $(151,170). The increase in loss from operations for the three months ended September 30, 2006 compared with loss from operations for the three months ended September 30, 2005 resulted primarily from reasons described above. OTHER (INCOME) EXPENSE. Other (income) expense was $102,215 for the three months ended September 30, 2006, as compared to $(54,594) for the three months ended September 30, 2005. This change was the result of the decrease of equity in losses in investing. NET LOSS. Net loss for three months ended September 30, 2006 was $(1,632,057) compared to net loss of $(97,277) for the three months ended September 30, 2005. The decrease in net loss was due to the reasons described above. NINE MONTHS ENDED SEPTEMBER 30, 2006 COMPARED WITH NINE MONTHS ENDED SEPTEMBER 30, 2005 NET SALES. Net sales for the nine months ended September 30, 2006 were $4,573,444 compared to $8,677,108 for the nine months ended September 30, 2005. The decrease in net sales for the nine months ended September 30, 2006 was due to a decrease in demand for our products. COST OF SALES. Cost of sales for the nine months ended September 30, 2006 was $4,255,593 or 93.1% of net sales, as compared to $8,060,736 or 92.9% of net sales, during the nine months ended September 30, 2005. The decrease in cost of sales is associated with the decrease in sales. The increase in the cost of sales as a percentage of revenue was due to decreased sales of higher-margin products and discounts to sell our stock. GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses were $2,290,515, or 50.1% of net sales, for the nine months ended September 30, 2006, as compared to $1,207,762, or 13.9% of net sales, for the nine months ended September 30, 2005. The increase was due to an increase in bad debt expense. The increase in general and administrative expenses as a percentage of net sales is also due to the increase in bad debt expense. INCOME (LOSS) FROM OPERATIONS. Loss from operations for the nine months ended September 30, 2006 was $(1,972,664), compared to income from operations for the nine months ended September 30, 2005 of $(591,390). The loss from operations for the nine months ended September 30, 2006 compared with income from operations for the nine months ended September 30, 2005 was due to a decrease in sales without a proportionate pro·por·tion·ate adj. Being in due proportion; proportional. tr.v. pro·por·tion·at·ed, pro·por·tion·at·ing, pro·por·tion·ates To make proportionate. decrease in the cost of sales and general and administrative expenses. OTHER (INCOME) EXPENSE. Other (income) expense was $(24,702) for the nine months ended September 30, 2006, as compared to $649,154 for the nine months ended September 30, 2005. This change was the result of the decrease of equity in losses in investing, commission income and other income. NET LOSS. Net loss for nine months ended September 30, 2006 was $(2,072,407) compared to income of $(1,240,883) for the nine months ended September 30, 2005. The net loss for the nine months ended September 30, 2006 compared with income for the nine months ended September 30, 2005 was due to the reasons described above. LIQUIDITY AND CAPITAL RESOURCES At September 30, 2006 and December December: see month. 31, 2005, we had cash and cash equivalents of $41,415 and $856,587, respectively. Our current assets Current Assets Appearing on a company's balance sheet, it represents cash, accounts receivable, inventory, marketable securities, prepaid expenses, and other assets that can be converted to cash within one year. totaled $7,259,443 at September 30, 2006 as compared to $9,639,735 at December 31, 2005. Our total current liabilities Current Liabilities Usually appearing on a company's balance sheet, it represents the amount owed for interest, accounts payable, short-term loans, expenses incurred but unpaid, and other debts due within one year. were $7,107,002 at September 30, 2006 as compared to $10,272,005 at December 31, 2005. Working capital at September 30, 2006 was $152,441 and $(632,270) at December 31, 2005. For the nine months ended September 30, 2006, total cash used in operations was $(1,048,903) as compared to net cash provided by operations of $(890,388) during the same period in 2005. Net cash provided by financing activities was $278,954, which consisted of loans, as compared with net cash used in financing activities of $(678,702) during the nine months ended September 30, 2005. CAPITAL EXPENDITURES. Total capital expenditures during the nine months ended September 30, 2006 were $1,688,671 compared to $0 for the nine months ended September 30, 2005. |
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