GUANGZHOU CITY, China, Aug. 18 /PRNewswire-Asia/ --
-- Third quarter revenues accelerated to 32.8% from 15.3% in 1st half of
fiscal 2010
-- Q3 video showcase revenues increased 26.6% year-over-year; paying
subscribers up 56.1% from Q2 to 34,382
-- Q3 Cloud computing revenues up 62.7% to $1.9 million; paying
subscribers up 41.5% quarter-over-quarter to 7,344
-- $15.1 million in cash flow from continuing operations for first nine
months
-- Company reaffirms previously stated guidance of $38.3 million in
revenue and net income from continuing operations of $12.5 million, or
$1.77 per common share, for fiscal year 2010. Management is confident
the stated guidance will be met but is also in the process of reviewing
the Company's financial results against the previously stated guidance.
Subaye, Inc. (Nasdaq: SBAY) ("Subaye" or the "Company") announced its financial results for the third quarter of the fiscal year ending September 30, 2010. Summary financial data is provided below:
Third quarter Nine months
Ended June 30, Ended June 30,
2010 2010
Revenue Growth from Continuing Ops 32.8% 21.5%
Gross Margin 69.7% 74.4%
Fully Diluted EPS from Continuing Ops $ 0.43 $ 1.43
Three Months Ended June 30, 2010
Revenues
Revenues for the three months ended June 30, 2010 were $9.1 million, a 32.8% increase from $6.8 million for the three months ended June 30, 2009. Revenues in Video Showcase Product (Video) and the Cloud Computing Product (CC) increased 26.6% and 62.7% from the prior year, respectively, representing 79% and 21% of total revenues. The number of paying customers for the Company's Video Showcase subscribers increased 56.1% sequentially to 34,382. The Company entered two new markets for its video showcase product in the third quarter, generating 6,944 new paying subscribers. Cloud Computing subscribers jumped 41.2% from March 31, 2010 to 7,344. Subscribers pay $117 and $100 per month of video and CC services, respectively. Revenue is recognized on a pro-rata basis, thus a significant portion of revenues resulting from this membership growth will not be recognized until the fourth quarter 2010.
Third Quarter 2010 Revenue Breakdown By Business Unit (USD in thousands)
(unaudited)
(three months ended June 30,) 2010 2009 CHNAGE
Video Showcase Product $7,164 $5,659 +26.6%
% of Sales 79.0% 82.9% --
Cloud Computing Product $1,904 $1,170 +62.7%
% of Sales 21.0% 17.1% --
"We saw healthy growth across our video showcase and cloud computing products, driven by increased penetration in existing markets and entrance into new markets such as Hainan and Hubei" said Mr. Zhiguang Cai, Chief Executive Officer of Subaye, Inc. "The 41.2% quarter-over-quarter growth in CC reflects the value we provide to Small and Medium Sized Enterprises (SMEs) and success with our renewed marketing efforts. We will continue to introduce new features and services across our online video platform to help our customers sell more products and services to their clients. With online video advertising accelerating from a small base and more Chinese consumers shopping online, we see significant opportunities to gain additional market share."
Cost of Sales
Cost of sales for the three months ended June 30, 2010 increased 94.0% to $2.7 million over the same period a year ago, with $0.6 million emanating from stock-based compensation for the Company's new agents in certain Chinese provinces compared to none in the year ago period. Depreciation and amortization of websites, software and hardware totaled $1.8 million for the three months ended June 30, 2010, up 29.1% from the third quarter of 2009 due primarily to the acquisition of six websites from CoCloud.com in the second quarter of 2010.
Gross Margin
The Company's gross margin was 69.7% and 79.3%, respectively, for the three months ended June 30, 2010 and 2009. We expect gross margin to be down year-over-year in the fourth quarter of fiscal 2010 as we recognize the costs associated with the issuance of stock-based compensation for new agents.
Share Based Compensation
Share based compensation for the quarter increased 407.7% to $1.5 million from $0.3 million in the third quarter of 2009, primarily due to stock issuances to management, consultants, and members of the Board of Directors during the first quarter of 2010 and the issuance of a stock warrant to a consultant during the second quarter of 2010, respectively.
Amortization of Software & Hardware
Amortization of software and hardware for the quarter increased 112.5% to $0.9 million from $0.4 million in the second quarter of 2009 due to additional amortization resulting from investments during the third quarter in computer software and computer hardware associated with the Cloud Product.
Amortization of Websites
Amortization of websites for the quarter decreased 8.9% to $0.9 million from $1.0 million in the second quarter of 2009. The http://www.subaye.com website was fully amortized as of December 31, 2009. Additional purchases of websites has since generated additional amortization but the amortization is not quite as significant as the amortization associated with the http://www.subaye.com website.
Operating Expenses
Operating expenses for the third quarter totaled $2.3 million, including a $1.0 million marketing promotion, as compared to $0.1 million for the three months ended June 30, 2009. The 2010 marketing promotions took place during February and June targeting new subscribers through a variety of web-based advertising promotions primarily focused on potential customers in Guangdong Province. We believe our advertising and promotion initiatives have yielded higher returns over the past five months, as reflected in the pickup in subscriber growth in video and cloud computing products. Other selling, general and administrative expenses consisted mostly of the amortization of stock based compensation to management, consultants and members of the Board of Directors that was not considered related to the direct generation of revenues. Total other selling, general and administrative expenses were $1.3 million and $0.7 million, respectively, an increase of 78.2%.
Provision for Income Taxes
Provision for income taxes was $0.8 million and $0.0 for the three months ended June 30, 2010 and 2009, respectively. The Company's continuing business operations are estimated to be subject to PRC and Hong Kong income taxes of approximately 18.0% for the three months ended June 30, 2010. For the three months ended June 30, 2009, the Company's continuing business operations were not subject to any income taxes due to a PRC tax holiday and limited operations in Hong Kong.
Net Income
Net income for the three months ended June 30, 2010 was $1.9 million as compared to $4.3 million for the three months ended June 30, 2009. Net income from continuing operations for the three months ended June 30, 2010 was $3.3 million, a decline of 28.6% from $4.6 million last year.
Net loss from discontinued operations was $(1.4) million and $(0.3) million for the three months ended June 30, 2010 and 2009, respectively. We sold our trading services business to Superb Quality Limited for $0.6 million in the third quarter. We are currently seeking buyers for our entertainment business.
Diluted Income per Share for Continuing Operations
The Company's diluted net income per share from continuing operations was $0.43 and $2.58 for the three months ended June 30, 2010 and 2009, based on weighted average common shares outstanding of 7.6 million and 1.8 million, respectively.
Diluted (Loss) Income per Share for Discontinued Operations
The Company's diluted net (loss) income per share from discontinued operations was $(0.19) and $(0.18) for the three months ended June 30, 2010 and 2009, based on weighted average common shares outstanding of 7.6 million and 1.8 million, respectively.
Adjusted Net Income and Adjusted Net Income Margin for Continuing Operations
Adjusted net income from continuing operations excluding share based compensation expenses and amortization of software & hardware, and websites (non-GAAP) for the quarter increased 5.1% to $6.6 million from $6.3 million in the third quarter of 2009. Adjusted net income margin from continuing operations (non-GAAP) for the quarter was 73.1% compared to 92.4% in the third quarter of 2009. Adjusted net income from continuing operations increased as a result of the increase in revenues during the third quarter of 2010 that also corresponded with an increase in costs of sales and operating expenses. Adjusted net margin from continuing operations decreased as a result of the substantial increase in costs of sales related to the amortization of stock based compensation issued to the Company's sales agents and an increase in advertising expenditures during the third quarter.
Adjusted Diluted EPS for Continuing Operations
Adjusted diluted earnings per share from continuing operations excluding share based compensation expenses and amortization of software & hardware, and websites (non-GAAP) for the quarter were $0.43 compared to $0.62 in the third quarter of 2009, based on weighted average common shares outstanding of 7.6 million and 5.2 million, respectively. Weighted average shares outstanding for the third quarter of 2009 were adjusted for comparison purposes to assume that the 3.4 million shares issued on November 6, 2009 for the minority interest acquisition were outstanding for the entire nine months ended June 30, 2009.
Nine months Ended June 30, 2010
Revenues
Revenues for the nine months ended June 30, 2010 increased to $23.4 million, 21.5% over the same period last year, driven by a 16.6% and 43.5% increase in Video Showcase and Cloud Computing revenues, respectively. Video Showcase subscription revenues for the nine months ended June 30, 2010 increased 16.6% to $18.3 million as compared to $15.7 million for the three months ended June 30, 2009, while Cloud Computing Product revenues increased 43.5% to $5.0 million. The number of paying customers for the Company's Video Showcase subscribers increased 112.1% year-over-year while CC subscribers were up 41.2%.
Year-to-date 2010 Revenue Breakdown By Business Unit (USD in thousands)
(unaudited)
(nine months ended June 30,) 2010 2009 CHANGE
Video Showcase Product $18,330 $15,716 +16.6%
% of Sales 78.4% 81.7% --
Cloud Computing Product $5,038 $3,510 +43.5%
% of Sales 21.6% 18.3% --
Cost of Sales
Cost of sales for the nine months ended June 30, 2010 was $6.0 million versus $4.3 million last year. Stock based compensation included in cost of sales was $1.3 million and $0.0 for the nine months ended June 30, 2010 and 2009, respectively. Depreciation and amortization of websites, software and hardware totaled $4.0 million and $4.7 million for the nine months ended June 30, 2010 and 2009, respectively.
Gross Margin
The Company's gross margin was 74.4% and 77.9%, respectively, for the nine months ended June 30, 2010 and 2009.
Share Based Compensation
Share based compensation for the nine months ending June 30, 2010 increased 327.1% to $4.0 million from $0.9 million in the same period last year.
Amortization of Software & Hardware
Amortization of software and hardware for the quarter decreased 8.1% to $2.2 million from $2.3 million in the same period last year.
Amortization of Websites
Amortization of websites for the quarter decreased 1.8% to $1.8 million from $1.9 million in the same period last year.
Operating Expenses
Operating expenses for the nine months ended June 30, 2010 dropped by 39.4% to $5.7 million due primarily to lower advertising and promotion costs during the nine months ended June 30, 2010 while the prior year period included approximately $6.7 million for a one-time marketing promotion. Other selling, general and administrative expenses consisted mostly of stock based compensation to management, consultants and members of the Board of Directors and totaled $3.7 million compared to $2.3 million in the same period last year, a 61.8% increase.
Provision for Income Taxes
Provision for income taxes was $2.2 million and $0.0 for the nine months ended June 30, 2010 and 2009, respectively. The Company's continuing business operations are estimated to be subject to PRC and Hong Kong income taxes of approximately 18.0% for the nine months ended June 30, 2010. For the nine months ended June 30, 2009, the Company's continuing business operations were not subject to any income taxes due to a PRC tax holiday and limited operations in Hong Kong.
Net Income
Net income for the nine months ended June 30, 2010 was $4.5 million as compared to $7.4 million for the nine months ended June 30, 2009. Net income from continuing operations was $9.5 million, up approximately 70% from $5.6 million for the nine months ended June 30, 2009. Net (loss) income from discontinued operations was $(5.0) million and $1.8 million for the nine months ended June 30, 2010 and 2009, respectively.
Diluted Income per Share for Continuing Operations
The Company's diluted net income per share from continuing operations was $1.43 and $3.28 for the nine months ended June 30, 2010 and 2009, based on weighted average common shares outstanding of 6.6 million and 1.7 million, respectively.
Diluted (Loss) Income per Share for Discontinued Operations
The Company's diluted net (loss) income per share from discontinued operations was $(0.77) and $1.06 for the nine months ended June 30, 2010 and 2009, based on weighted average common shares outstanding of 6.6 million and 1.7 million, respectively.
Adjusted Net Income and Adjusted Net Income Margin for Continuing Operations
Adjusted net income from continuing operations excluding share based compensation expenses and amortization of software & hardware, and websites (non-GAAP) for the nine months ending June 30, 2010 increased 62.9% to $17.6 million from $10.8 million in the same period last year. Adjusted net income margin from continuing operations (non-GAAP) for the nine months ending June 30, 2010 was 75.2% compared to 56.1% in the third quarter of 2009, primarily due to a significant increase in revenues and a significant decrease in advertising expenses during the nine months ended June 30, 2010 as compared to the nine months ended June 30, 2009.
Adjusted Diluted EPS for Continuing Operations
Adjusted diluted earnings per share from continuing operations excluding share based compensation expenses and amortization of software & hardware, and websites (non-GAAP) for the nine months ending June 30, 2010 were $2.64 compared to $2.11 in the same period last year, based on weighted average common shares outstanding of 6.6 million and 5.1 million, respectively. Weighted average shares outstanding for the nine months ended June 30, 2009 were adjusted for comparison purposes to assume that the 3.4 million shares issued on November 6, 2009 for the minority interest acquisition were outstanding for the entire nine months ended June 30, 2009.
Liquidity and Capital Resources
As of June 30, 2010, the Company had $38.9 million of working capital and a current ratio of 8.6. Cash and cash equivalents totaled $2.1 million as of June 30, 2010 while shareholders equity was approximately $65 million. The Company generated $15.1 million of cash flows from operation in the nine months ended June 30, 2010. During the nine months ended June 30, 2010, the Company incurred $6.9 million in fees paid to a contractor to begin development work on a video search software application, and an additional $6.9 million was paid for new computer servers and software licenses, all of which will be amortized over 3 years. The Company had net cash from (used) discontinued operations of $1.0 million and $(2.6) million for the nine months ended June 30, 2010 and 2009, respectively.
2010 and 2011 Guidance
Adjusting for the sale of its trade services and entertainment media businesses as discontinued operations effective March 16, 2010, Subaye reaffirms guidance for fiscal year 2010 of revenue of $38.3 million and net income from continuing operations of $12.5 million, or $1.77 per share, for the fiscal year ending September 30, 2010. For fiscal year 2011 the Company expects growth in revenue and net income from continuing operations of 86.3% and 133.5% over fiscal year 2010 guidance, respectively, resulting in revenue of $71.3 million and net income from continuing operations of $29.2 million, or $3.69 per share. The chart below provides key statistics for the Company's continuing operations, consisting solely of its on-line video advertising business.
Results From Continuing Operations FY2009 FY2010 FY2011
(On-line Video Advertising Business) (Actual) (Projected) (Projected)
Revenue Growth 180.3% 43.5% 86.3%
Net Income Growth 61.5% 126.1% 133.5%
Gross Margin 77.6% 82.0% 80.3%
Net Margin 32.2% 32.7% 41.0%
The preceding projections include assumptions based on the acquisition of new members in various provinces within Greater China. The projections do not include any revenues or profits potentially generated by the Company's on-line 3D shopping portal.
Management is confident the stated guidance will be met but is also in the process of reviewing the Company's financial results against the previously stated guidance.
Business Outlook
Subaye's goal for 2010 is to rapidly expand its video advertising and cloud computing businesses throughout Greater China by introducing new products and entering new markets. Since Subaye launched its video advertising business in Guangdong Province in October 2006, it has entered 10 new markets, collectively adding over 22,000 new customers. The Company has seen robust customer growth in both new and existing markets, as recent marketing and promotional activities have helped increase awareness and sales productivity. Subaye is on target to meet its goal of offering video showcase in 15 provinces by the end of the fiscal year ending September 30, 2010. The Company plans to increase its sales force from approximately 300 individuals to over 1,500 by December 31, 2010.
Cloud Computing is quickly becoming a second high margin source of growth of Subaye. Since refocusing our sales and marketing efforts in March 2010, we have witnessed explosive growth in new subscribers, up over 41% in the past three months. SMEs are seeing the value provided by our enhanced online tools for video, content and customer relationship management.
Adding to Subaye's opportunity in this segment is its recent acquisition of 6 websites from CoCloud.com.cn (CIL) that provides the Company with 12,200 new members that are affiliated with the 6 largest wholesale distribution centers in Guangzhou City, China. In the third quarter, we began integrating CIL's services into our core online video platform. We expect these networks to complement our existing video and CC services and drive additional new subscribers to our website, http://www.subaye.com . Additionally, the Company's online 3D mall is on track to be operational by November 30, 2010.
About Subaye, Inc.
Subaye, Inc. is a leading outsourced marketing services provider in China engaged in on-line video advertising and cloud computing business solutions. Subaye's on-line video advertising platform provides production, upload, storage, and publishing onto video sharing websites. Subaye also offers cloud computing business solutions and is in the process of developing an on-line mall to with 3D imaging throughout the on-line customer interface. Visitors of Subaye's websites, namely, http://www.subaye.com , view video showcases of Subaye members, primarily small to mid-size enterprises ("SMEs"), and select products or services they wish to purchase. The Company previously conducted a trade services and an entertainment media business. For further information on Subaye, Inc., please visit http://www.subaye.net .
Forward-Looking Statements
Certain statements contained herein constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations, estimates and projections about Subaye, Inc.'s industry, management's beliefs and certain assumptions made by management. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Because such statements involve risks and uncertainties, the actual results and performance of the Company may differ materially from the results expressed or implied by such forward-looking statements. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Subaye, Inc.'s operations are conducted in the People's Republic of China ("PRC") and, accordingly, are subject to special considerations and significant risks not typically associated with companies in North America. These include risks associated with, among others, the political, economic and legal environment and foreign currency exchange. The Company's results may be adversely affected by changes in the political and social conditions in the PRC and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation. Other potential risks and uncertainties include but are not limited to the ability to procure, properly price, retain and successfully complete projects, and changes in products and competition. Unless otherwise required by law, the Company also disclaims any obligation to update its view of any such risks or uncertainties or to announce publicly the result of any revisions to the forward-looking statements made here. Readers should review carefully reports or documents the Company files periodically with the Securities and Exchange Commission.
About Non-GAAP Financial Measures
To supplement our consolidated financial statements, which statements are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures: adjusted net income, adjusted net-income margin, and adjusted EPS. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. We use these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. Our management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenses and expenditures that may not be indicative of our recurring core business operating results. These non-GAAP financial measures exclude from our operating performance not only non-cash charges, such as stock-based compensation, but also discrete cash charges that are infrequent in nature. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting and analyzing future periods. These non-GAAP financial measures also facilitate management's internal comparisons to our historical performance and liquidity as well as comparisons to our competitors' operating results. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision making and (2) they are used by our institutional investors and the analyst community to help them analyze the health of our business. The accompanying tables have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures.
Financial Statements Follow
SUBAYE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
June 30, September 30,
2010 2009
(In Thousands)
(Unaudited) (Audited)
Assets
Current Assets
Cash $2,082 $2
Accounts Receivable, Net of Allowance
for Doubtful
Accounts of $363 as of June 30, 2010
and September 30, 2009, Respectively 11,328 8,266
Prepaid Expenses 1,133 370
Deposit for Purchase of Inventoriable
Assets 6,254 8,152
Assets Held for Sale 23,170 29,360
Total Current Assets 43,967 46,150
Property and Equipment, Net of
Accumulated
Depreciation of $17,758 and $12,863
as of June 30, 2010 and September
30, 2009 26,099 10,580
Total Assets $70,066 $56,730
Liabilities and Equity
Current Liabilities
Accounts Payable and Accrued Expenses $2,884 $566
Taxes Payable 2,221 --
Liabilities Held for Sale 8 5,275
Total Current Liabilities 5,113 5,841
Total Liabilities 5,113 5,841
Commitments and Contingencies
Shareholders' Equity
Preferred Stock, $0.001 Par Value,
50,000,000 Shares Authorized, 0
Shares Issued and Outstanding as
of June 30, 2010 and September 30,
2009 -- --
Common Stock, $0.001 Par Value;
150,000,000 Shares Authorized;
7,444,931 and 2,479,243 Shares
Issued and Outstanding as of June
30, 2010 and September 30, 2009 7 3
Additional Paid in Capital 58,949 32,452
Deferred Stock Based Compensation (8,945) (2,908)
Accumulated Other Comprehensive
Income (149) 54
Retained Earnings 15,091 11,108
Total Shareholders' Equity 64,953 40,709
Noncontrolling Interest in
Subsidiaries -- 10,180
Total Equity 64,953 50,889
Total Liabilities and Equity $70,066 $56,730
SUBAYE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF OPERATIONS
AND OTHER COMPREHENSIVE INCOME
For the Three Months For the Nine Months
Ended Ended
June 30, June 30,
2010 2009 2010 2009
In Thousands, Except per Share Amounts
Net Sales $9,068 $6,829 $23,368 $19,226
Cost of Sales 2,745 1,415 5,971 4,258
Gross Profit 6,323 5,414 17,397 14,968
Operating Expenses
Advertising 1,003 110 2,031 7,123
Other Selling, General and
Administrative 1,269 712 3,652 2,257
Total Operating Expenses 2,272 822 5,683 9,380
Income From Continuing
Operations Before
Income Tax Expense 4,051 4,592 11,714 5,588
Income Tax Expense (772) -- (2,221) --
Income From Continuing
Operations 3,279 4,592 9,493 5,588
(Loss) Income From
Discontinued
Operations (1,411) (326) (5,038) 1,807
Net Income 1,868 4,266 4,455 7,395
Net Income Attributable to the
Noncontrolling Interest -- (1,525) (472) (1,388)
Net Income Attributable to
Subaye $1,868 $2,741 $3,983 $6,007
Net Income From Continuing
Operations
Per Common Share:
Basic $0.44 $2.58 $1.45 $3.28
Diluted $0.43 $2.58 $1.43 $3.28
Net (Loss) Income From
Discontinued
Operations Per Common Share:
Basic $(0.19) $(0.18) $(0.77) $1.06
Diluted * $(0.19) $(0.18) $(0.77) $1.06
Net Income Per Common Share:
Basic $0.25 $2.40 $0.68 $4.34
Diluted * $0.25 $2.40 $0.67 $4.34
Weighted Average Common Shares
Outstanding:
Basic 7,444,931 1,781,089 6,561,121 1,702,010
Diluted 7,615,131 1,781,089 6,646,013 1,702,010
Comprehensive Income:
Net Income $1,868 $4,266 $4,455 $7,395
Foreign Currency Translation
Adjustment,
Net of Tax (88) 2 (203) 23
Comprehensive Income 1,780 4,268 4,252 7,418
Comprehensive Income
Attributable to the
Noncontrolling Interest -- (1,525) (436) (1,395)
Comprehensive Income
Attributable to
Subaye $1,780 $2,743 3,816 $6,023
SUBAYE, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED UNAUDITED STATEMENTS OF CASHFLOWS
For the Nine Months
Ended June 30,
2010 2009
(In Thousands)
Cash Flows From Operating Activities
of Continuing
Operations:
Net Income $4,455 $7,395
Adjustments to Reconcile Net Income
to Net Cash Provided by
Operating Activities-
Depreciation and Amortization 4,021 4,247
Amortization of Stock Based
Compensation 4,053 949
Bad Debt Expense -- 332
(Increase) Decrease in Assets-
Accounts Receivable (3,062) (880)
Prepaid Expenses (763) (1,672)
Deposits on Inventoriable Assets 1,882 (8,152)
Increase in Liabilities -
Accounts Payable and Accrued Expenses 2,323 492
Income Taxes Payable 2,221 --
Net Cash Provided By Operating
Activities 15,130 2,711
Cash Flows From Investing Activities
of Continuing
Operations:
Purchase of Property and Equipment (13,803) --
Net Cash Used in Investing Activities (13,803) --
Cash Flows From Financing Activities
of Continuing
Operations:
Cash Proceeds From Sale of Common
Stock -- 394
Net Cash Provided by Financing
Activities -- 394
Cash Flows From Discontinued
Operations:
Net Cash Provided By (Used in)
Operating Activities 956 (2,598)
Net Cash Provided By (Used in)
Discontinued Operations 956 (2,598)
Effect of Exchange Rate Changes in
Cash
(203) (55)
Increase in Cash
2,080 452
Cash, Beginning of Period
2 49
Cash, End of Period $2,082 $501
Supplemental Cash Flow Information:
Cash Paid During the Period for
Interest, Net of Amounts Capitalized $-- $--
Income Taxes $-- $--
Supplemental Schedule of Noncash
Investing and Financing
Activities:
Issuance of Stock for Services,
Deferred Compensation $10,115 $1,180
Issuance of Stock for Acquisition of
Websites and Related
Assets $5,760 $--
Adjustment of additional paid-in-
capital and non-controlling interests
from investment in Subaye Inc, by
non-controlling interests $10,652 $--
Source: Subaye, Inc.
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