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SURFACE COATINGS, INC. - 10-Q - MANAGEMENT'S DISCUSSION AND ANALYSIS

May 14, 2014



This report contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. The Company's actual results could differ materially from those set forth on the forward looking statements as a result of the risks set forth in the Company's filings with the Securities and Exchange Commission, general economic conditions, and changes in the assumptions used in making such forward looking statements.

General



The Company has no operations and is currently evaluating business options which may include, but not be limited to, pursuing an asset acquisition, merger, exchange of capital stock or other business combination with a domestic or foreign business.

RESULTS FOR THE QUARTER ENDED MARCH 31, 2014

Our first quarter ended on March 31, 2014. Any reference to the end of the fiscal quarter refers to the end of the first quarter for the period discussed herein.

REVENUE. There was no revenue from continuing operations for the three months ended March 31, 2014 and 2013.

OPERATING EXPENSES. Total operating expenses for the three months ended March 31, 2014 and 2013 were $5,912 and $6,295, respectively. The expenses relate to the continuing operations related audit fees and other services. There was no depreciation expense incurred.

NET INCOME (LOSS). The net income (loss) for the three months ended March 31, 2014 and 2013 was a loss of $5,912 and $6,295, respectively.

LIQUIDITY AND CAPITAL RESOURCES. Our cash balance was zero at March 31, 2014. As discussed in Note 5 to the financial statements, the Company has recurring losses and an accumulated deficit. We now have minimal cash flow requirements as we have to cover the costs of public company requirements, while we search for a suitable acquisition candidate.

In addition to the preceding, the Company plans for liquidity needs on a short term and long term basis as follows:

Short Term Liquidity:

The company currently relies on short-term financing of working capital from shareholder advances, when necessary, to fund operations.

Long Term Liquidity:

The company has no long term liquidity plans as it is searching for a suitable acquisition partner.

Capital Resources



We do not expect any significant change to our debt structure and do not anticipate entering into any off-balance sheet arrangements.

Material Changes in Financial Condition

WORKING CAPITAL: Working Capital decreased from December 31, 2013 to March 31, 2014 by $5,912, to negative $90,356. This reduction is due to the net loss discussed above.

STOCKHOLDER'S EQUITY: Stockholder's Equity decreased by $5,912, as a result of the loss for the period.

Employees



At March 31, 2014, the Company had one employee, unpaid.

Management Advisors



Yorkdale Capital, LLC advises and assists the President with many aspects related to the regulatory filings including assistance with the consolidation of financial statements for audit. Yorkdale Capital, LLC or its principals are shareholders and are owed $85,542 and $65,186 as March 31, 2014 and December 31, 2013, respectively, for operating expenses.

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Source: Edgar Glimpses


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