KINETIC GROUP INC. The following discussion should be read in conjunction with our audited financial statements and notes thereto included herein. In connection with, and because we desire to take advantage of, the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, we caution readers regarding certain forward looking statements in the following discussion and elsewhere in this report and in any other statement made by, or on our behalf, whether or not in future filings with theSecurities and Exchange Commission . Forward-looking statements are statements not based on historical information and which relate to future operations, strategies, financial results or other developments. Forward looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control and many of which, with respect to future business decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ materially from those expressed in any forward looking statements made by, or our behalf. We disclaim any obligation to update forward-looking statements.
Results of operations for the years ended
Revenue
We generate revenue from sales of our marketing and web development services directly to small and medium-sized businesses. We acquire customers through direct telemarketing, referrals and our primary website that provides a description of our company and our service offerings (www.groupkinetic.com).
Our gross revenue from the provision of services for the years endedSeptember 30, 2020 and 2019 was$0 and$10,350 respectively. Our cost of revenues for the year endedSeptember 30, 2019 was$4,200 resulting in a gross income of$6,150 . 15 Costs and Expenses
The major components of our expenses for the years ended
For the For the
Year Ended Year Ended Increase
September 30, 2020 September 30, 2019 (Decrease)
Compensation - officers $ - $ 7,000$ (7,000 ) Professional fees 31,572 17,850 13,722 General and administrative 3,797 18,541 (14,744 ) $ 35,369 $ 43,391$ (8,022 )
The decrease in our operating costs for the year ended
For the For the
Year Ended Year Ended
September 30, 2020 September 30, 2019 President, Chief Executive Officer $ - $ 5,600 Former President - Chief Financial Officer, Secretary and Treasurer -
5,600
$ - $ 11,200 *
* - During the year ended September 30, 2019 , $4,200 of these related parties
consulting services was recognized in cost of revenues and $7,000 in officers'
compensation within operating expenses.
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Accounts Payable - Related Parties
As of
Liquidity Our internal liquidity is provided by our operations. During the years endedSeptember 30, 2020 and 2019 the Company reported net loss from operations of$14,819 and$37,241 , respectively. To date we have financed our operations by cash generated from sales of our services and shares of our common stock. We were able to sustain our operations by increasing the number of our clients and providing additional services to our existing clients.
Since inception, we have sold 2,750,000 shares of common stock at
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If we are not successful in expanding our clientele base, maintaining profitability and positive cash flow, additional capital may be required to maintain ongoing operations.
We have explored and are continuing to explore options to provide additional
financing to fund future operations as well as other possible courses of action.
Such actions include, but are not limited to, securing lines of credit, sales of
debt or equity securities (which may result in dilution to existing
shareholders), loans and cash advances from our directors or other third
parties, and other similar actions. There can be no assurance that we will be
able to obtain additional funding (if needed), on acceptable terms or at all,
through a sale of our common stock, loans from financial institutions, our
directors, or other third parties, or any of the actions discussed above. If we
cannot sustain profitable operations, and additional capital is unavailable,
lack of liquidity could have a material adverse effect on our business
viability, financial position, results of operations and cash flows.
Cash Flows
The table below, for the period indicated, provides selected cash flow
information:
For the For the
Year Ended Year Ended
September 30, 2020 September 30, 2019 Net cash used in operating activities $ (19 ) $ (41,527 ) Net cash used in investing activities - - Net cash provided by financing activities - 35,798 Net increase (decrease) in cash $ (19 )
$ (5,729 ) We have generated revenues of$0 and$10,350 during the years endedSeptember 30, 2020 and 2019, respectively. In addition, we received proceeds of$0 and$0 from sale of our common stock during the years endedSeptember 30, 2020 and 2019. We had no other sources of cash inflow during the reporting periods.
Cash Flows from Operating Activities
Our cash used by operating activities as ofSeptember 30, 2020 of$19 (September 30, 2019 :$41,527 ) is a net result of cash generated from sales of our marketing and web development services, and changes in our current assets and liabilities. This portion of our cash flow represents the most significant, in addition to the offering proceeds and sale of unregistered stock, source of funding for our operations during the years endedSeptember 30, 2020 and 2019. The major uses of our operating cash include acquisition of computer equipment and software, funding general operating expenses (professional fees, consulting, travel, office expenses and office rent) and cost of revenues. 18
Cash Flows from Investing Activities
We did not generate any cash from investing activities during the year ended
Cash Flows from Financing Activities
Not applicable.
Recent Accounting Pronouncements
See Note 2 to the Financial Statements.
Off Balance Sheet Arrangements
As of
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