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Friday
May 2, 10:15 am Eastern Time
Company Press Release
NORTH
AMERICAN DATACOM HALTS ITS OPERATIONS
IUKA,
Miss. – March 31, 2003 – North American DataCom,
Inc. (NADA), announced today that has halted its operations
due a lack of funding. The Company also announced its results
for the first 6 months of fiscal 2003 ending December 31,
2002.
“The
6-month delay by the Company’s auditors in completing
their 10K audit, coupled with the continued weakness of the
financial markets and telecommunications sector, have prevented
the Company from obtaining additional financing to fund Application
Service and Data Storage operations” said Robert Crawford,
President of NADA. “The unexplained delay in providing
current audited financial statements to its equity and debt
funding sources prevented the Company from obtaining continued
funding of its reduced operating losses.”
The Company’s
audit firm has been unable to complete its audit due to unexplained
and unreasonable delays. These delays have prevented the timely
filing of the Company’s 10K for the period ending June
30, 2002 and its 10Qs for the two quarterly periods ending
December 31, 2002.
For the
six months ending December 31, 2002 the Company had revenues
of $381,044, an improvement of 56% over the prior year’s
results of $244,859, and a net loss $316,752 that is 64% less
than the 2002 results. The net loss for the first 6 months
ending December 31, 2002 was $316,752 compared with $874,692
for the previous year. This 64 % reduction is directly attributable
to the continuation of expense reduction program. Selling,
general and administrative (SG&A) costs for the six months
amounted to $305,119 compared with $822,884 a year ago. Other
Income and Expenses were reduced compared to last year. These
Other Expenses are largely attributable to the Global PTX
startup net equity loss which was reduced to $30,107 for the
six month period compared to the 2002 the net equity loss
of $51,896. The Company’s unaudited financial results
for this period will be available once the Company resolves
the significant impediment caused by its auditors. The Company’s
Form10Q, when filed, will provide this detail.
The Internet
access services and digital and alphanumeric paging services
that the Company had provided are now being provided by a
local Mississippi firm. This firm in assuming the responsibilities
of the internet and paging services has assumed certain liabilities
of the Company. The Company has the right to purchase these
businesses back under reasonable conditions. The data storage
and application development businesses have been terminated.
The Company has terminated its headquarters and Data Storage
Center facilities lease with the State of Mississippi.
NADA continues
to hold a minority interest in Global PTX, LLC. Global provides
“end-to-end” vendor/customer supply-chain synchronization
systems, and is targeting Manufacturing and Retail Business
Industry Sector corporations. Global’s objective is
to reduce enterprise expenses and providing significant improvement
in operating efficiencies for the entire supply chain group.
‘‘The
Company cannot continue its strategic international partnerships
until the Company’s damages from the auditor’s
delay are addressed and favorably resolved. These multi-national
partnership relationships can still strengthen Global’s
private trade exchange market position,” said Robert
R. Crawford. “The combination of the Company’s
data storage, the communications network services and Global
PTX software and ASP expertise was planned to provide a wide
solution for global marketing and product supply requirements."
Once
the CPA audit problem is resolved and interim funding is received
the Company intends to restart its business activities. The
Company does not have any salaried employees as of this date.
Robert Crawford is continuing as a non salaried employee to
manage the Company’s affairs.
Safe Harbor Statement
Statements in this release express management's beliefs and
expectations regarding future performance. These statements
are forward-looking and involve risk and uncertainties. These
risks include, but not limited to, the ability to negotiate
venture agreements, properly identify acquisition partners,
manage and integrate acquired businesses, react to quarterly
fluctuation in results, raise working capitol and secure other
financing, respond to competition and other rapidly expanding
technology, deal with market and stock price fluctuation,
and other risks. These risks are and will be detailed, from
time to time, in North American DataCom, Inc. Securities and
Exchange Commission filings. Actual results may differ materially
from management's expectations.
North American DataCom’s principal executive offices
have been relocated at PO Box 37, Iuka, MS 38852. For further
information contact (662) 424-5051 or e-mail at investorrelations@nadata.com.
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