Seratosa Inc (OTCMKTS:STOA) submitted its annual report on Form 10-K with the SEC. In the annual report, it stated that it can become a part of the e-commerce growth as a leading company offering e-commerce services and solutions. It expects to move forward with its efficient cost structure and efficient technology, and source engineering and technical personnel in Asia. It is looking for opportunities to acquire companies or technologies that can boost the growth of the company.
The need for capital
Seratosa mentioned that to become competitive and profitable and implement strategic transactions, it may need additional capital. If the company fails to raise additional equity capital, it would be forced to cease or suspend some of the operations, and investors would be at a risk of losing their investment. There is no assurance that financings will be available to Seratosa on acceptable terms. Also, it added that equity financing could lead to additional dilution to shareholders.
The performance
For the fiscal ended December, 2014 Seratosa reported working capital deficit of $231,768 compared to a deficit of $138,995 as on December, 2013. The decline in working capital deficit can be attributed to drop of cash balances as a result of net loss. It recorded annual net loss of $255,693 compared to a net loss of $1.2 million in the same period, a year ago. The company recorded $174,798 of cash in operating activities.
Going concern
The registered independent auditors have released a going concern opinion. It implies there is substantial uncertainty that Seratosa can continue as an on-going entity for the next 12 months. It needs to obtain additional capital to pay the existing bills. The potential revenue sources are two customers for whom Seratosa is hosting e-commerce solutions.
In last trading session, the stock price of Seratosa declined more than 18% to close the trading session at $0.00130.
