This quarterly report on Form 10-Q includes "forward-looking statements" as
defined by the Securities and Exchange Commission. These statements may involve
known and unknown risks, uncertainties and other factors which may cause actual
results, performance or achievements to be materially different from future
results, performance or achievements expressed or implied by any forward-looking
statements. Forward-looking statements, which involve assumptions and describe
future plans, strategies and expectations, are generally identifiable by use of
the words "may," "will," "could", "should," "expect," "anticipate," "estimate,"
"believe," "intend" or "project" or the negative of these words or other
variations on these words or comparable terminology. These forward-looking
statements are based on assumptions that may be incorrect. Actual results could
differ materially from those expressed or implied by the forward-looking
statements as a result of various factors. The company undertakes no obligation
to update publicly any forward-looking statements for any reason, even if new
information becomes available or other events occur in the future.
The following discussion should be read in conjunction with the Company's Form
10-K for the fiscal year ended June 30, 2022.
OVERVIEW
The Company's inflight connectivity technology is targeted at two distinct
markets. BizjetMobile and CrewX are designed for business jets and has been sold
in North America, Europe and the Middle East. The Company's fflya system is
designed for, and marketed to, low-cost airlines in Europe and Asia. Further
details of BizjetMobile and fflya are included in the Form10-K for the year
ended June 30, 2022.
As noted above, the Company's arrangements in regard to BizjetMobile have been
re-negotiated and as a result, revenue has re-commenced in the six months ended
December 31, 2022.
The Company has continued investing in the development and marketing of the
airline versions of its fflya and CrewX technology. As previously noted, the
Company has secured its launch fleet, Wizz Air Hungary Airlines Limited, to
provide its fflya system for 19 of its United Kingdom based A320 and A321
aircraft for a minimum three years under a previously agreed revenue sharing
arrangement.
RESULTS OF OPERATIONS
THREE MONTHS ENDED DECEMBER 31, 2022 COMPARED TO THREE MONTHS ENDED DECEMBER 31,
2021
In the three months period ended December 31, 2022, the Company recorded revenue
of $29,982, compared to revenue of $0 in the corresponding three-month period
ended December 31, 2021, from commissions under the new license arrangements
with ASiQ Pty. Ltd.
The Company incurred operating costs of $205,770 in the three months ended
December 31, 2022 and $494,678 in the three months ended December 31, 2021. Main
components are engineering, installation, technical support and marketing
expenses. In the three months ended December 31, 2022, the Company recorded an
Operating Loss of $175,788 compared to an Operating Loss of $494,678 in the
three months ended December 31, 2021.
The development and marketing costs have been funded in part through interest
bearing convertible notes. As a result, the Company's Other Expenses, included
interest of $74,797 in the three months ended December 31, 2022, compared to
interest cost of $214,778 in the three months ended December 31, 2021. The
decreased expense was a result of some of the convertible notes being replaced
with shares of the Company's common stock, effective June 30, 2022. After
interest costs, the Company recorded a Net Losses of $250,585 and $739,831 in
the three months ended December 31, 2022 and 2021 respectively.
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SIX MONTHS ENDED DECEMBER 31, 2022 COMPARED TO SIX MONTHS ENDED DECEMBER 31,
2021
In the six months period ended December 31, 2022, the Company recorded revenue
of $53,876, compared to revenue of $0 in the corresponding six-month period
ended December 31, 2021, as the Company received the first commissions under the
new license arrangements with ASiQ Pty. Ltd.
The Company incurred operating costs of $436,827 in the six months ended
December 31, 2022 and $697,985 in the six months ended December 31, 2021. Main
components are engineering, installation, technical support and marketing
expenses. In the six months ended December 31, 2022, the Company recorded an
Operating Loss of $382,951 compared to an Operating Loss of $697,985 in the six
months ended December 31, 2021.
The development and marketing costs have been funded in part through interest
bearing convertible notes. As a result, the Company's Other Expenses, included
interest of $147,157 in the six months ended December 31, 2022, compared to
interest cost of $301,798 in the six months ended December 31, 2021. The
decreased expense was a result of some of the convertible notes being replaced
with shares of the Company's common stock, effective June 30, 2022. After
interest costs, the Company recorded a Net Losses of $530,108 and $1,030,158 in
the six months ended December 31, 2022 and 2021 respectively.
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary sources of liquidity are cash received from issue of
common stock and accounts payable for expenses incurred with related parties.
Without the continuation of these sources of funding, as stated in Note 2 above,
the Company's ability to continue as a going concern is in substantial doubt.
This will continue until the company is able to generate sufficient cash flow
from its operations.
The cash and cash equivalents balance was $17,380 at December 31, 2022. The
Company reported revenue of $53,876 in the six months ended December 31, 2022
compared to $0 in the six month period ended December 31, 2021 as a result of
revenue from BizjetMobile re-commencing. The Company incurred a loss of $530,108
from operating activities for the six months to December 31, 2022, compared to
a loss of $1,030,158 from operating activities for the six months to December
31, 2021. Net cash used in operating activities for the six months ended
December 31, 2022 was $218,801 compared to $808,746 during the six months ended
December 31, 2021. Operating cash requirement in the six months ended December
31, 2022 decreased mainly through higher related party payables and decreased
directors fees and prepaid expenses.
The cash flow of the Company from financing activities for the six months ended
December 31, 2022 was $128,083 as a result of funds received for issuance of
common stock. In the six months ended December 31, 2021, the cash flow from
financing activities was $1,001,715 mainly from funds received for issuance of
common stock and shares issued in lieu of interest.
The Company may raise additional capital by the sale of its equity securities,
through an offering of debt securities, or from borrowing from a financial
institution or other funding sources. The Company does not have a policy on the
amount of borrowing or debt that the Company can incur. There are no guarantees
on the company's ability to raise additional capital and hence its ability to
continue as a going concern.
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