News Column

THERMAL TENNIS INC. - 10-Q - Management's Discussions and Analysis of Financial Condition and Results of Operations.

July 24, 2014

Forward-looking Statements

Statements made in this Quarterly Report which are not purely historical are forward-looking statements with respect to the goals, plan objectives, intentions, expectations, financial condition, results of operations, future performance and our business, including, without limitation, (i) our ability to raise capital, and (ii) statements preceded by, followed by or that include the words "may," "would," "could," "should," "expects," "projects," "anticipates," "believes," "estimates," "plans," "intends," "targets" or similar expressions.

Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond our control) that could cause actual results to differ materially from those set forth in the forward-looking statements, including the following, general economic or industry conditions, nationally and/or in the communities in which we may conduct business, changes in the interest rate environment, legislation or regulatory requirements, conditions of the securities markets, our ability to raise capital, changes in accounting principles, policies or guidelines, financial or political instability, acts of war or terrorism, other economic, competitive, governmental, regulatory and technical factors affecting our current or potential business and related matters.

Accordingly, results actually achieved may differ materially from expected results in these statements. Forward-looking statements speak only as of the date they are made. We do not undertake, and specifically disclaim, any obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of such statements.

Plan of Operations

Our business is to develop tennis management programs, tennis training programs, sales of tennis equipment and general services related to tennis. Thermal Tennis has devoted substantially all of their time and effort to organizational and financing matters during the past few years. Through the date hereof, we have not yet generated material service revenue during this period and we have realized a net loss from operations. We generated revenues during the three months ended June 30, 2014 in the amount of $0 versus $24 generated during the three months ended June 30, 2013. This was a decrease of $24 for the quarter due to the Company terminating its main contract with a facility in Reno and no programs being offered in early 2014. The Company's net loss during the three months ended June 30, 2014 was $12,659 and for the three months ended June 30, 2013 the loss was $10,568. The gross revenues decreased due to the reasons stated above, the net loss increased by $2,091. This was due to an increase in the interest expense from the increase in the amount of short term debt and a small increase in administrative costs. These changes caused a fairly substantial difference in the loss between the two quarters. The Company expects that it will continue to generate operating losses. The Company is pursuing other contracts and is seeking other business opportunities that would generate revenues and profitability for the Company.

In March 2013 the Company terminated its contract that represented over ninety percent of its gross revenues. The Company will be conducting and expanding the High School summer camps with additional focus on High School and College training. The Company is hoping to provide these programs on a national level and that the revenues generated from the sales of these programs will eventually lead to sufficient profitability and associated cash flows from operations.

- 11 - --------------------------------------------------------------------------------



The Company signed a letter of intent on June 20, 2014 to purchase 100% of the ownership interests of CannaSys, LLC. The Company hopes that this business opportunity will generate revenues and profitability for the Company.

The Company expects even if it closes the LOI mentioned above, it will have to continue to borrow money to sustain its operations in the next twelve months. We do not anticipate the performance of any research and development during the next 12 months.

There can be no assurance that we will achieve commercial acceptance for any of our proposed tennis services in the future; that future service revenue will materialize or be significant; that any sales will be profitable; or that we will have sufficient funds available for further development of our proposed services. The likelihood of our success will also depend upon our ability to raise additional capital from equity and/or debt financing to overcome the problems and risks described herein; to absorb the expenses and delays frequently encountered in the operation of a new business; and to succeed in the competitive environment in which we will operate. Although management intends to explore all available alternatives for equity and/or debt financing, including, but not limited to, private and public securities offerings, there can be no assurance that we will be able to generate additional capital. Our continuation as a going concern is dependent on our ability to generate sufficient cash flow to meet our obligations on a timely basis and, ultimately, to achieve profitability.

Financial Condition, Capital Resources and Liquidity

As of June 30, 2014, we had total cash assets of $2,939, which decreased $209 during 2014 even with the Company borrowing $25,000 in the first quarter. We had total assets of $2,930 as of June 30, 2014. We had total current liabilities of $228,734 and working deficit and stockholders' deficit of $225,804 as of June 30, 2014. Deficits accumulated during the history of the Company have totaled $272,308. Our financial statements are presented on the basis that Thermal Tennis is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable length of time. However, our independent accountants have noted that the Company has accumulated losses from operations and has the need to raises additional financing in order to satisfy its vendors and other creditors and execute its business plan. These factors raise substantial doubt about our ability to continue as a going concern. Our future success will be dependent upon our ability to provide effective and competitive tennis services that meet customers' changing requirements. Additionally, the Company signed a letter of intent on June 20, 2014 to purchase 100% of the ownership interests of CannaSys, LLC. The Company hopes that this business opportunity will generate revenues and profitability for the Company. Should Thermal Tennis' efforts to raise additional capital through equity and/or debt financing fail, Robert Deller, our President/Secretary/Treasurer, is expected to provide the necessary working capital so as to permit Thermal Tennis to continue as a going concern.

- 12 - --------------------------------------------------------------------------------



At June 3, 2014 the Company has been generating revenues from operations that began in early 2009 and was still seeking capital through obtaining of additional debt in order to continue its operations. The business activities the Company has are seasonal and it receives a majority of the revenues and earnings in the second and third quarters of the calendar year. Even with the acquisition mentioned above, the Company does not know if the revenues will provide sufficient earnings to cover the cost of its operations. The Company expects the gross revenues will not be sufficient to cover all of its current operations. The Company will have to obtain additional revenues to become profitable. At June 30, 2014 and through the date of this filing, the Company has yet to obtain any other commitments for additional funding. The Company expects it will have to borrow additional monies to provide enough working capital to continue its operations during the next twelve months and to execute its business plan. In the quarter ended June 30, 2014, the Company had not received any additional funding and supported its operations through the borrowings during the prior quarter from notes payable in the amount of $25,000. In the year ended December 31, 2013 the Company received $25,000 from borrowings. The Company expects it will have to borrow additional funds against its credit lines to sustain operations to continue its current operations.

In March 2013 the Company terminated its contract that represented over ninety percent of its gross revenues. The Company will be conducting and expanding the High School summer camps with additional focus on High School and College training. The Company is hoping to provide these programs on a national level and that the revenues generated from the sales of these programs will eventually lead to sufficient profitability and associated cash flows from operations.

Additionally, the Company signed a letter of intent on June 20, 2014 to purchase 100% of the ownership interests of CannaSys, LLC. The Company hopes that this business opportunity will generate revenues and profitability for the Company.

Until the Company obtains the capital required to develop any properties or businesses and obtains the revenues needed from its future operations to meet its obligations, the Company will depend on sources other than operating revenues to meet its operating and capital needs. Operating revenues may never satisfy these needs.

- 13 -



--------------------------------------------------------------------------------


For more stories on investments and markets, please see HispanicBusiness' Finance Channel



Source: Edgar Glimpses


Story Tools






HispanicBusiness.com Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters