The following discussion should be read in conjunction with our audited
financial statements and the related notes that appear elsewhere in this Annual
Report. The following discussion contains forward-looking statements that
reflect our plans, estimates and beliefs. Our actual results could differ
materially from those discussed in the forward-looking statements. Factors that
could cause or contribute to such differences include but are not limited to
those discussed below and elsewhere in this Annual Report. Our audited financial
statements are stated in United States Dollars and are prepared in accordance
with United States Generally Accepted Accounting Principles.
Plan of Operation
The Company, through its subsidiaries, SilverLight Aviation, LLC and Silverlight
Electric Vehicle Inc. is actively engaged in the design, development,
manufacturing, distribution and marketing of reverse trikes and gyrocopters.
To continue operations for the next 12 months we will have a cash need of
approximately $500,000. The Company expects to fulfill our cash needs through
revenue. Should this not be sufficient we will need to raise money through
outside investors through convertible notes, debt or similar instrument(s), the
Company has no committed external source of funds, and there is no guarantee we
would be able to raise such funds. The Company plans to pay off current
liabilities through sales and increasing revenue through sales of Company
services and or products, or through financing activities as mentioned above.
Results from Operations - For the year ended December 31, 2022 as compared to
December 31, 2021
The following discussion reflects consolidated financial statements for the year
ended December 31, 2022 as compared to the consolidated financial statements for
the year ended December 31, 2021.
Revenue
The Company had sales of $424,462 for the year ended December 31, 2022 and
$608,524 for the year ended December 31, 2021. The decrease is primarily due to
fewer gyrocopter sales during the year ended December 31, 2022.
Operating Expenses
The Company had operating expenses of $422,325 for the year ended December 31,
2022 and $429,839 for the year ended December 31, 2021.
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Loss From Operations
As a result of the foregoing, loss from operations was $683,690 for the year
ended December 31, 2022 and $280,194 for the year ended December 31, 2021. The
increase in our overall loss from operations was a result of an increase in the
cost of goods sold, specifically an increase in purchases.
Net Income (Loss)
The Company had a net loss of $404,926 for the year ended December 31, 2022 and
$213,996 for the year ended December 31, 2021. The decrease is primarily due to
an increase in cost of goods sold.
Liquidity and Capital Resources
As of December 31, 2022 and 2021 the Company had $1,999,941 and $2,409,333 in
total assets respectively.
As of December 31, 2022, the Company has yet to achieve profitable operations,
and while the Company hopes to achieve profitable operations in the future, if
not it may need to raise capital from stockholders or other sources to sustain
operations and to ultimately achieve viable operations. These factors raise
substantial doubt about the Company's ability to continue as a going concern.
The Company's principal sources of liquidity have been cash provided by
operating activities, as well as its ability to raise capital. The Company's
operating results for future periods are subject to numerous uncertainties and
it is uncertain if the Company will be able to become profitable and continue
growth for the foreseeable future. If management is not able to increase revenue
and/or manage operating expenses, the Company may not be able to achieve
profitability. The Company's ability to continue in existence is dependent on
the Company's ability to achieve profitable operations.
To continue operations for the next 12 months we will have a cash need of
approximately $500,000. Should we not be able to fulfill our cash needs through
the increase of revenue we will need to raise money through outside investors
through convertible notes, debt or similar instrument(s), the Company has no
committed external source of funds, and there is no guarantee we would be able
to raise such funds. the Company plans to pay off current liabilities through
sales and increasing revenue through sales of Company services and or products,
or through financing activities as mentioned above.
Net Cash Used in Operating Activities
For the year ended December 31, 2022 $718,467 net cash used in operating
activities was primarily due to a loss from continued operations financed by
loans from related parties. For the year ended December 31, 2021 $1,118,976 net
cash used in operations was primarily due to a loss from continued operations
and a large increase in inventory during 2021.
Net Cash Used by Investing Activities
For the year ended December 31, 2022 net cash used by investing activities was
$25,339 as compared to $657,594. The decrease was due to the purchase of a
subsidiary, net of working capital of $306,858 and purchase of assets and molds
of $350,736 during the year ended December 31, 2021.
Net Cash Provided by Financing Activities
For the year ended December 31, 2022 net cash used by financing activities was
$316,252 compared to $2,260,800 provided by financing activities for the year
ended December 31, 2021. The change was due to the investment by the Company in
the year 2021 financed by related party loans.
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Liquidity and Capital Resources
As of December 31, 2022, the Company had $1,999,941 in total assets, consisting
of $877,310 in inventory, $693,141 in goodwill, $68,536 in intangible assets,
and $287,278 in property plant and equipment. The Company had total liabilities
of $2,699,034 as of December 31, 2022.
As of December 31, 2022, the Company has yet to achieve profitable operations,
and while the Company hopes to achieve profitable operations in the future, if
not it may need to raise capital from stockholders or other sources to sustain
operations and to ultimately achieve viable operations. These factors raise
substantial doubt about the Company's ability to continue as a going concern.
The Company's principal sources of liquidity have been cash provided by
operating activities, as well as its ability to raise capital. The Company's
operating results for future periods are subject to numerous uncertainties and
it is uncertain if the Company will be able to become profitable and continue
growth for the foreseeable future. If management is not able to increase revenue
and/or manage operating expenses, the Company may not be able to achieve
profitability. The Company's ability to continue in existence is dependent on
the Company's ability to achieve profitable operations.
Our cash flows for the period ended December 31, 2022 and 2021 are summarized
below:
Twelve Twelve Months
Months Ended Ended
December 31, December 31,
2022 2021
Net cash provided by (used by) operating activities (718,468 ) (1,118,976 )
Net cash provided by (used by) investing activities (25,339 ) (657,594 )
Net cash provided by financing activities
316,252 2,260,800
NET CHANGE IN CASH (427,555 ) 484,230
CASH, Beginning 484,230 -
CASH, Ending $ 56,675 $ 484,230
Advances from Officer
During the year ended December 31, 2022, an Officer loaned the company $9,545 to
pay operating expenses.
Critical Accounting Policies
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities of the date
of the financial statements and the reported amounts of revenues and expenses
during the reporting period. Notes to the Consolidated Financial Statements
describes the significant accounting policies and methods used in the
preparation of the Consolidated Financial Statements. Estimates are used for,
but not limited to, contingencies and taxes. Actual results could differ
materially from those estimates. The following critical accounting policies are
impacted significantly by judgments, assumptions, and estimates used in the
preparation of the Consolidated Financial Statements.
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Loss Contingencies
The Company is subject to various loss contingencies arising in the ordinary
course of business. The Company considers the likelihood of loss or impairment
of an asset or the incurrence of a liability, as well as its ability to
reasonably estimate the amount of loss in determining loss contingencies. An
estimated loss contingency is accrued when management concludes that it is
probable that an asset has been impaired or a liability has been incurred and
the amount of the loss can be reasonably estimated. The Company regularly
evaluates current information available to us to determine whether such accruals
should be adjusted.
Income Taxes
The Company recognizes deferred tax assets (future tax benefits) and liabilities
for the expected future tax consequences of temporary differences between the
book carrying amounts and the tax basis of assets and liabilities. The deferred
tax assets and liabilities represent the expected future tax return consequences
of those differences, which are expected to be either deductible or taxable when
the assets and liabilities are recovered or settled.
Recent Accounting Pronouncements
See Note 2 of the consolidated financial statements for discussion of Recent
Accounting Pronouncements.
Off-Balance Sheet Arrangements
We are not currently a party to, or otherwise involved with, any off-balance
sheet arrangements that have or are reasonably likely to have a current or
future material effect on our financial condition, changes in financial
condition, revenues or expenses, results of operations, liquidity, capital
expenditures or capital resources.
Recently Adopted Accounting Standards
In May 2014, the FASB issued Accounting Standards Update ("ASU") No.
2014-09, Revenue from Contracts with Customers: Topic 606, or ASU 2014-09. ASU
2014-09 establishes the principles for recognizing revenue and develops a common
revenue standard for U.S. GAAP. The standard outlines a single comprehensive
model for entities to use in accounting for revenue arising from contracts with
customers and supersedes most current revenue recognition guidance, including
industry-specific guidance. In applying the new revenue recognition model to
contracts with customers, an entity: (1) identifies the contract(s) with a
customer; (2) identifies the performance obligations in the contract(s); (3)
determines the transaction price; (4) allocates the transaction price to the
performance obligations in the contract(s); and (5) recognizes revenue when (or
as) the entity satisfies a performance obligation. The accounting standards
update applies to all contracts with customers except those that are within the
scope of other topics in the FASB Accounting Standards Codification. The
accounting standards update also requires significantly expanded quantitative
and qualitative disclosures regarding the nature, amount, timing and uncertainty
of revenue and cash flows arising from contracts with customers. This guidance
is effective for fiscal years and interim periods within those years beginning
after December 15, 2017. The Company adopted ASU 2014-09 effective January 1,
2018. The adoption of this standard had no material impact on the Company's
financial statements.
Purchase of Significant Equipment
We have not previously, nor do we intend to purchase any significant equipment
during the next twelve months.
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