WEB NEWS Comments & Business Outlook
HW HOLDINGS, INC. (F.K.A. HORIYOSHI WORLDWIDE, INC.)
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS
(UNAUDITED)
For the three months ended
For the six months ended
June 30,
June 30,
June 30,
June 30,
2015
2014
2015
2014
Revenue, net
85,119
117,296
88,575
224,091
Cost of sales
32,920
61,867
34,733
118,466
Gross profit
52,199
55,429
53,842
105,625
Operating Expenses
Selling expenses
312
5,190
642
15,677
General and administrative expenses
75,495
338,013
147,857
614,079
Depreciation and amortization
2,784
6,567
5,568
13,296
Total operating expenses
78,591
349,770
154,067
643,052
Loss from operations
(26,392
)
(294,341
)
(100,225
)
(537,427
)
Non-operating income (expenses)
Other income
9
—
159
—
Loss on early lease termination
—
—
(6,605
)
—
Foreign currency transaction gain
58,371
25,935
12,046
35,757
Net income (loss) before interest and taxes
31,988
(268,406
)
(94,625
)
(501,670
)
Interest expense
(835
)
(17,471
)
(2,941
)
(33,465
)
Net income (loss) before income taxes
31,153
(285,877
)
(97,566
)
(535,135
)
Income taxes
—
—
—
—
Net income (loss)
31,153
(285,877
)
(97,566
)
(535,135
)
Foreign currency translation adjustment
(63,712
)
(25,112
)
(13,544
)
(33,713
)
Comprehensive loss
(32,559
)
(310,989
)
(111,110
)
(568,848
)
Income (loss) per share of common stock
(0.00
)
(0.35
)
(0.00
)
(0.66
)
Weighted average shares of common
57,535,611
810,180
55,202,278
810,180
Management Discussion and Analysis
Revenue
We earned revenues of $85,119 for the three months ended June 30, 2015 compared to revenues of $117,296 for the three months June 30, 2014. For the six months ended June 30, 2015 we earned revenues of $88,575 compared to $224,091 for the corresponding period in 2014. Revenues decreased in the three and six months periods as a result budget constraints leading to decreased production and a lack of new season inventory.
CFO Trail
Comments & Business Outlook
HW HOLDINGS, INC. (F.K.A. HORIYOSHI WORLDWIDE, INC.)
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
For the three months ended
March 31, March 31,
2015 2014
Revenue, net $ 3.456 $ 106,795
Cost of sales 1,813 56,599
Gross profit $ 1,643 $ 50,196
Operating Expenses
Selling expenses 330 10,487
General and administrative expenses 72,362 276,066
Depreciation 2.784 6,729
Total operating expenses $ 75,476 $ 293,282
Loss from operations (73,833 ) (243,086 )
Non-operating income (expenses)
Other income 150
Loss on early lease termination (6,605 )
Foreign currency transaction gain/(loss) (46,325 ) 9,822
Net loss before interest and taxes (126,613 ) (233,264 )
Interest expense 2,106 15,994
Net loss before income taxes (128,719 ) (249,258 )
Income taxes — —
Net loss $ (128,719 ) $ (249,258 )
Foreign currency translation adjustment 50,168 (8,601 )
Comprehensive loss $ (78,551 ) $ (257,859 )
Earnings (loss) per share of common stock $ (0.00 ) $ (0.32 )
Weighted average shares of common 52,898,945 810,180
Management Discussion and Analysis
Revenue
We earned revenues of $3,456 for the three months ended March 31, 2015 compared to revenues of $106,795 for the three months March 31, 2014. Revenues decreased as a result of reduced web sales as well as the closure of our branded retail outlet.
Comments & Business Outlook
HW HOLDINGS, INC. (F.K.A. HORIYOSHI WORLDWIDE, INC.)
CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS
For the years ended
December 31, December 31,
2014 2013
Revenue, net $ 384,120 $ 862,198
Cost of sales 291,044 653,146
Gross profit 93,076 209,052
Operating Expenses
Selling expenses 20,610 61,823
General and administrative expenses 1,566,910 1,476,077
Depreciation and amortization 26,219 28,584
Loss on fixed asset disposal 13,527 9,983
Total operating expenses 1,627,266 1,576,467
Loss from operations (1,534,190 ) (1,367,415 )
Non-operating income (expenses)
Other income 1,300 2,166
Loss on employee loans (4,976 ) —
Foreign currency transaction gain/(loss) (68,260 ) 34,361
Net (loss) before interest and taxes (1,606,126 ) (1,330,888 )
Interest expense 8,238 60,092
Net (loss) before income taxes (1,614,364 ) (1,390,980 )
Income taxes — —
Net (loss) (1,614,364 ) (1,390,980 )
Foreign currency translation adjustment 68,346 (30,911 )
Comprehensive (loss) $ (1,546,018 ) $ (1,421,891 )
Earnings (loss) per share of common stock $ (0.07 ) $ (1.82 )
Weighted average shares of common 23,314,048 763,372
Management Discussion and Analysis
Revenue
We earned revenues of $384,120 for the year ended December 31, 2014 compared to revenues of $862,198 for the year ended December 31, 2013. Decreased revenues in 2014 can be attributed to our inability to produce and deliver a full collection of seasonal wholesale orders due to cash flow constraints. In addition, our branded retail outlet in London was inoperable in October and November 2014 due to the Company’s inability to pay employee wages.
Pump and Dump Watch
Disclosure: GeoInvesting is providing this information for your edification and in no way has any affiliation with any promoters and/or newsletters disseminating information on HHWW, nor is GeoInvesting being paid to post this information. At times, the GeoTeam may trade P&D's on a long or short basis, depending on how we feel the momentum of the stocks will be affected by the efforts of stock promoters and any ensuing dumps.
CFO Trail
Item 4.01 Changes in Registration’s Certifying Accountant
EFPR’s reports on the financial statements of the Company for each of the past two fiscal years have neither contained an adverse opinion or a disclaimer of opinion, nor been qualified or modified as to uncertainty, audit scope or accounting principles, except that, the reports included an explanatory paragraph with respect to the uncertainty as to the Company’s ability to continue as a going concern. During the past two fiscal years and in the subsequent interim period through December 23, 2014, there were (i) no disagreements with EFPR on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of EFPR, would have caused it to make reference to the subject matter of the disagreements in connection with its reports, and (ii) there were no reportable events (as that term is defined in Item 304(a)(1)(v) of Regulation S-K), except that, EFPR advised the Company that there were material weaknesses in its internal controls over financial reporting, which the Company agreed with and disclosed in its Form 10-K’s for the years ended December 31, 2013, and 2012, respectively.
Comments & Business Outlook
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS
(UNAUDITED)
For the three months ended For the nine months ended
September 30, September 30, September 30, September 30,
2014 2013 2014 2013
Revenue, net
$
141,408 $
128,084
$ 365,499 $ 652,445
Cost of sales
80,648 53,724
199,114 361,978
Gross profit
60,760 74,360
166,385 290,467
Operating Expenses
Selling expenses
2,337 3,010
18,063 59,667
General and administrative expenses
792,480 301,200
1,406,510 1,154,803
Depreciation and amortization
6,558 6,756
19,854 21,776
Total operating expenses
801,375 310,966
1,444,427 1,236,246
Loss from operations
(740,615 ) (236,606 )
(1,278,042 ) (945,779 )
Non-operating income (expenses)
Loss on fixed asset disposal
— (175 )
— (8,514 )
Foreign currency transaction gain/(loss)
(57,170 ) 57,406
(21,412 ) 11,668
Net loss before interest and taxes
(797,785 ) (179,375 )
(1,299,454 ) (942.625 )
Interest expense
(15,603 ) (13,127 )
(49,070 ) (38,694 )
Net loss before income taxes
(813,388 ) (192,502 )
(1,348,524 ) (981,319 )
Income taxes
— —
— —
Net loss
(813,388 ) (192,502 )
(1,348,524 ) (981,319 )
Foreign currency translation adjustment
52,907 (48,623 )
19,194 (3,975 )
Comprehensive loss
$ (760,481 ) $ (241,125 )
$ (1,329,330 ) $ (985,294 )
Loss per share of common stock
$ (0.02 ) $ (0.24 )
$ (0.08 ) $
(1.31 )
Weighted average shares of common
51,202,278 810,180
17,607,546 747,770
Management Discussion and Analysis
Revenue
We earned revenues of $141,408 for the three months ended September 30, 2014 compared to revenues of $128,084 for the three months September 30, 2013. For the nine months ended September 30, 2014 we earned revenues of $365,499 compared to $652,445 for the corresponding period in 2013. Revenues increased in the three month period due to decreased retail prices at our branded London store. Revenues decreased for the nine month period due to a significant decline in 2014 wholesale sales as well as decreased sales of prior season inventory to wholesale discounters.
For the three months ended September 30, 2014 expenses increased $490,409, or 158%, to $801,375 as compared to $310,966 for the corresponding period in 2013. For the nine months ended September 30, 2014 expenses increased $208,181 or 17%, to $1,444,427 as compared to $1,236,246 for the corresponding period in 2013. This increase can be attributed to a the recognition of $557,842 in stock compensation expense for the issuance of shares to directors, officers, employees and various vendors for services rendered.
Comments & Business Outlook
HORIYOSHI WORLDWIDE, INC.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS
(UNAUDITED)
For the three months ended
For the six months ended
June 30,
June 30,
June 30,
June 30,
2014
2013
2014
2013
Revenue, net 117,296
208,001
224,091
524,361
Cost of sales 61,867
158,791
118,466
308,254
Gross profit 55,429
49,210
105,625
216,107
Operating Expenses
Selling expenses 5,190
5,854
15,677
56,657
General and administrative expenses 338,013
371,102
614,079
853,603
Depreciation and amortization 6,567
7,383
13,296
15,020
Total operating expenses 349,770
384,339
643,052
925,280
Loss from operations (294,341)
(335,129)
(537,427)
(709,173)
Non-operating income (expenses)
Loss on fixed asset disposal -
(8,339)
-
(8,339)
Foreign currency transaction gain/(loss) 25,935
4,400
35,757
(45,738)
Net loss before interest and taxes (268,406)
(339,068)
(501,670)
(763,250)
Interest expense (17,471)
(12,994)
(33,465)
(25,567)
Net loss before income taxes (285,877)
(352,062)
(535,135)
(788,817)
Income taxes -
-
-
-
Net loss (285,877)
(352,062)
(535,135)
(788,817)
Foreign currency translation adjustment (25,112)
(118)
(33,713)
44,648
Comprehensive loss (310,989)
(352,180)
(568,848)
(744,169)
Loss per share of common stock (0.35)
(0.43)
(0.66)
(1.10)
Weighted average shares of common stock outstanding 810,180
810,180
810,180
716,564
Management Discussion and Analysis
Revenue
We earned revenues of $117,296 for the three months ended June 30, 2014 compared to revenues of $208,001 for the three months June 30, 2013. For the six months ended June 30, 2014 we earned revenues of $224,091 compared to $524,361 for the corresponding period in 2013. Revenues decreased in the three and six months periods due to a significant decrease in spring/summer 2014 wholesale sales as well as decreased sales of prior season inventory to wholesale discounters.
Deal Flow
Item 1.01 Entry into Material Definitive Agreement Item 3.02 Unregistered Sales of Equity Securities
Also on July 24, 2014 we entered into subscription agreements with 14 subscribers for the issuance of 27,892,098 common shares at deemed price of $0.01 per share ($27,892.10 in the aggregate). The 27,892,098 shares were issued in partial compensation for consulting services rendered to our company by the subscribers. 15,672,098 of these shares issued were issued to 11 non-US persons in an offshore transaction relying on Regulation S of the Securities Act of 1933, as amended.
The balance of 12,220,000 shares were issued to 3 US persons relying on the exemptions from registration provided by Section 4(2) of the Securities Act of 1933 and upon Rule 506 of Regulation D of the Securities Act of 1933. Of these, 200,000 were issued to our Director, Raymond Catroppa, 5,820,000 were issued to our Director and Chief Financial Officer, Darren Takemoto, and 6,200,000 were issued to our Director, President and Chief Executive Officer, Kerry Chung.
Comments & Business Outlook
HORIYOSHI WORLDWIDE, INC.
CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE LOSS
For the years ended
December 31,
December 31,
2013
2012
Revenue, net
862,198
1,017,108
Cost of sales
653,146
660,783
Gross profit
209,052
356,325
Operating Expenses
Selling expenses
61,823
127,845
General and administrative expenses
1,476,077
2,453,303
Depreciation and amortization
28,584
102,084
Total operating expenses
1,566,484
2,683,232
Loss from operations
(1,357,432
)
(2,326,907
)
Non-operating income (expenses)
Other income
2,166
1,729
Loss on fixed asset disposal
(9,983
)
(2,904
)
Loss on asset impairment
—
(631,250
)
Foreign currency transaction gain/(loss)
34,361
(13,860
)
Net (loss) before interest and taxes
(1,330,888
)
(2,973,192
)
Interest expense
60,092
34,614
Net (loss) before income taxes
(1,390,980
)
(3,007,806
)
Income taxes
—
—
Net (loss)
(1,390,980
)
(3,007,806
)
Foreign currency translation adjustment
(30,911
)
(13,446
)
Comprehensive (loss)
(1,421,891
)
(3,021,252
)
Earnings (loss) per share of common stock
(1.82
)
(5.68
)
Weighted average shares of common
763,372
529,333
Management Discussion and Analysis
Revenue
We earned revenues of $862,198 for the year ended December 31, 2013 compared to revenues of $1,017,108 for the year ended December 31, 2012. Decreased revenues in 2013 can be attributed to our inability to produce and deliver a full collection for our fall/winter 2013 seasonal wholesale orders due to cash flow constraints. These decreases were offset by increased direct to consumer sales from our branded retail store in London and our branded website.
Comments & Business Outlook
HORIYOSHI WORLDWIDE, INC.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
For the three months ended For the six months ended
June 30, June 30, June 30, June 30,
2013 2012 2013 2012
Unaudited
Unaudited
Unaudited
Unaudited
Revenue, net
208,001
146,283
524,361
462,844
Cost of sales
158,791
86,574
308,254
262,685
Gross profit
49,210
59,709
216,107
200,159
Operating Expenses
Selling expenses
5,854
34,946
56,657
92,720
General and administrative expenses
371,102
564,258
853,603
1,216,148
Depreciation and amortization
7,383
25,456
15,020
50,884
Total operating expenses
384,339
624,660
925,280
1,359,752
Income (loss) from operations
(335,129
)
(564,951
)
(709,173
)
(1,159,593
)
Non-operating income (expenses)
Other income
—
1
—
84
Loss on fixed asset disposal
(8,339
)
—
(8,339
)
—
Foreign currency transaction gain/(loss)
4,400
(7,969
)
(45,738
)
(3,601
)
Net (loss) before interest and taxes
(339,068
)
(572,919
)
(763,250
)
(1,163,110
)
Interest expense
(12,994
)
—
(25,567
)
—
Net (loss) before income taxes
(352,062
)
(572,919
)
(788,817
)
(1,163,110
)
Income taxes
—
—
—
—
Net (loss)
(352,062
)
(572,919
)
(788,817
)
(1,163,110
)
Foreign currency translation adjustment
(118
)
2,541
44,648
(988
)
Comprehensive (loss)
(352,180
)
(570,378
)
(744,169
)
(1,164,098
)
Earnings (loss) per share of common stock
(0.43
)
(1.08
)
(1.10
)
(2.20
)
Weighted average shares of common
810,180
529,333
716,564
529,333
Comments & Business Outlook
HORIYOSHI WORLDWIDE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
Three Months
Three Months
Ended
Ended
March 31,
March 31,
2012
2011
Revenue, net
$
316,561
228,828
Cost of sales
176,111
102,847
Gross profit
140,450
125,981
Operating Expenses
Selling expenses
57,774
49,163
General and administrative expenses
651,890
454,691
Depreciation and amortization
25,428
2,699
Total operating expenses
735,092
506,553
Income (loss) from operations
(594,642
)
(380,572
)
Non-operating income
Other income
83
-
Foreign currency transaction gain
4,368
-
Net (loss) before income taxes
(590,191
)
(380,572
)
Income taxes
-
-
Net (loss)
$
(590,191
)
(380,572
)
Foreign currency translation adjustment
(3,529
)
-
Comprehensive loss
$
(593,720
)
$
(380,572
)
Basic and diluted earnings (loss) per share
$
(0.09
)
$
(0.06
)
Weighted average shares of common stock
6,351,416
6,351,416
CFO Trail
On January 1, 2011 we entered in a
consulting agreement with Raymond A. Catroppa as the company’s chief financial officer and corporate development executive on an interim basis. The consulting agreement provides for the basic remuneration of Mr. Catroppa at the rate of US$60,000 per annum payable in equal monthly installments. The term of the agreement shall begin on January 1, 2011 and continue through January 1, 2012 at which time the employment contract will be re-negotiated unless terminated by either party.
Deal Flow
LOS ANGELES, CA - Horiyoshi Worldwide Inc. is pleased to provide an update on the financing activities of the Company. As previously announced, the Company entered into a $5,000,000 equity financing agreement with Milan based investment group, Zyndy Trade Corp.
We are pleased to announce that we have received funds in the amount of $2,000,000 under the terms of the agreement, leaving a balance of $3,000,000 that the Company can call upon to fund our business and expansion strategies. Under the terms of the agreement, the closing of this initial drawdown consisted of the issuance of 1,933,395 restricted shares of common stock at the issuance price of $1.03445 , pursuant to the pricing provisions of the agreement.
Reverse Merger Activity
On November 5, 2010 Horiyoshi Worldwide became a public entity via a
reverse merger transaction .
Company Snapshot:
Design and fashion house that produces menswear, womanswear, accessories and jewelry
Post Merger Share Calculation :
94,866,525: Pre reverse merger outstanding shares
64,866,000: Shares cancelled as part of the Share Exchange
30,000,000: Newly issued shares of Common Stock
GeoTeam® best effort calculation of total post reverse merger shares assuming full conversions: 60,000,000
Financial Snapshot:
HHWW sales are negligible.
Liquidity Requirements
Growth of our operations will be based on our ability to internally finance from cash flow,
raise equity and/or debt to increase sales and production.
