Italk Inc (OTCMKTS:TALK) fell heavily during the previous trading session, which was more or less justifiable, given the company’s quarterly performance. The company might have escaped from such a massive fall if its numbers alone were dismal, which is a normal trend in penny stocks. But, the company’s self-doubt over its ability to continue to function as a ‘going concern’ has what irked the shareholders.
‘Going Concern.’
The company posted its 10-Q for the period ended on February 28, 2015 last week that described the worsening turn of events taking place at its helm. In its report, Italk Inc (OTCMKTS:TALK) mentioned the lower revenues aggregated during the quarter, which stood at $159,000. The revenue numbers were inclusive of deferred revenue to the tune of $104,565, which were carried forward from 2014. Hence, there was hardly any gain in terms of real revenue.
At the same time, the company’s Selling, General, and Administrative expenses increased to $186,950 from $144,000 year-over-year, which accompanied the increase in other expenses as well. The working capital of the company ran into a deficit of $2.7 million from $2.2 million quarter-over-quarter. The net loss of Italk Inc (OTCMKTS:TALK) came in at $373,000 during the reported three months period.
Vulnerable plans
The company did not shy away from acknowledging the truth that it has a problem in raising finance for its operations activities. The company even boldly stated that it might be unable to function as a ‘going concern’ if its efforts to raise sufficient capital does not yield results. Other than this, the company enlisted its plans, which included offering of affordable, cost-effective broadband plan priced as low as $9.99 per month. However, such plans are vulnerable to fail if the company is out of capital, which made investors wary to remain in the stock.
The quarterly report pushed investors to sell off their holdings in Italk Inc (OTCMKTS:TALK), leading to its nearly 43% fall to $0.00040. As many as 32.20 million shares traded during the last session.
