1st Q of 2015 is out
posted on
Mar 01, 2016 10:29AM
Bravo Multinational Incorporated. currently being restructured to include its gaming operations along with mining interests
Form 10-Q for GOLDLAND HOLDINGS CORP.
1-Mar-2016
Quarterly Report
THE FOLLOWING DISCUSSION SHOULD BE READ TOGETHER WITH THE INFORMATION CONTAINED IN THE FINANCIAL STATEMENTS AND RELATED NOTES INCLUDED ELSEWHERE IN THIS REPORT ON FORM 10-Q.
The following discussion reflects our plan of operation. This discussion should be read in conjunction with the financial statements which are included in this Report. This discussion contains forward-looking statements, including statements regarding our expected financial position, business and financing plans. These statements involve risks and uncertainties. Our actual results could differ materially from the results described in or implied by these forward-looking statements as a result of various factors, including those discussed below and elsewhere in this Report.
Unless the context otherwise suggests, "we," "our," "us," and similar terms, as well as references to "Goldland Holdings," all refer to Goldland Holdings and its subsidiaries as of the date of this report.
Company Overview
We were originally formed as Montrose Ventures, Inc. in the State of Delaware on May 25, 1989. On April 23, 1996, our name was changed to Java Group, Inc., which tried and failed to start a chain of coffee bars. On September 1, 2004, our name was changed to Consolidated General Corp., which tried to buy tier 2 and 3 professional sports teams, including the Vancouver Ravens lacrosse team and the San Diego Soccers soccer team. On August 7, 2007, our name was changed to Goldcorp Holdings Co. On October 15, 2010, our name was changed to GoldLand Holdings Co.
Former Business
Over the years, and prior to our entry into the business of the leasing of gaming equipment described below, we have been engaged in the business of leasing mining claims. On September 14, 2007, we acquired an interest in 174.82 acres of land on War Eagle Mountain in Idaho from Bisell Investments Inc. and New Vision Financial Ltd., two of our then major stockholders, for a total of 90,000,000 shares of our common stock. We acquired a 100% interest in 103 acres, and a 29.167% interest in 76.63 acres, respectively. We also leased five placer claims on War Eagle Mountain from the U.S. Bureau of Land Management (the "BLM"), each of which covered approximately 20 acres, or approximately 100 acres in total. Subsequently, as a result of a survey we allowed our original BLM claims to lapse, and reapplied for new lode claims that are better oriented in the direction of the three veins in the mountain. As a result, we own 14 unpatented lode claims covering 262.85 acres and 76.63 acres within seven patented claims with a 29.167% ownership interest. We may look to expand on our mining claims holdings in the future.
For a complete discussion of the mining activities on our mining claims conducted by other parties, please see our previous Form 10-Ks, 10-Qs, and 8-Ks filed with the Commission. However it should be noted that at no time was Goldland Holdings a mining operator. As descried above, Goldland Holdings owns and or maintains mining claims which are leased to a third party. Since the mining operations of our lessee no longer have any relevance to our new business of the leasing of gaming equipment, we will only include financial information relating to revenues, expenses, and results of operations and other relevant information with respect to the former mining activities of the lessee of our mining properties.
Current Business
We are currently engaged in the business of the leasing of gaming equipment. On September 19, 2013, Universal Equipment SAS, Inc., our wholly-owned subsidiary, entered into an asset purchase agreement to acquire certain gaming equipment from Universal Entertainment SAS, Ltd., a corporation formed under the laws of the Country of Colombia, for 17,450,535 shares of our common stock (post reverse-split on March 6, 2014). The closing occurred on March 6, 2014. The gaming equipment includes approximately 67 video poker and slot machines; eight blackjack and miscellaneous game tables, and related furniture and equipment; roulette table and related furniture and equipment; bingo equipment and furniture; casino chips, bill acceptors, coin counter and related equipment, and miscellaneous office equipment, like chairs and tables.
Upon closing of the acquisition of the gaming equipment, through our wholly owned subsidiary Universal Entertainment SAS, Inc. on March 6, 2014, we leased the gaming equipment to Vomblom & Pomare S.A., a company formed under the laws of the Country of Colombia, and controlled by Claudia Fuentes Robales, pursuant to a lease agreement which provided for lease payments of $700,000 per year, payable in the amount of $58,333 per month, with a term of five years with one five year renewal option. The gaming equipment was to be used primarily in the operation of a casino that is owned and operated by the lessee on San Andres Isla, Colombia. However, some of the gaming equipment, such as video poker and slot machines, could have been placed in retail locations under agreements with the retail merchants to divide winnings from the machines.
The above referred to lease agreement was cancelled by Universal Equipment SAS, Inc., on June 18, 2015, due to non-payment of the lease payments. We are now assessing new opportunities for the leasing of the gaming equipment. A new agreement would better reflect current economic and business conditions and is anticipated to have an effective start date within the first quarter of 2016.
Risks Related to Our Gaming Equipment Operations
We are affected by the risks faced by foreign casino owners who we expect will be our future customers. Our prospective gaming machine customers are engaged in economically sensitive and competitive businesses. As a result, we will be indirectly affected by all the risks facing foreign casino owners, which are beyond our control. Our results of operations will depend, in part, on the financial strength of our customers and our customers' ability to compete effectively in the marketplace and manage their risks. Many of these risks are discussed below.
Reductions in Consumer and Corporate Spending. Consumer demand for hotel/casino resorts, trade shows and conventions, and for luxury amenities is particularly sensitive to downturns in the economy and the corresponding impact on discretionary spending on leisure activities. Changes in discretionary consumer spending or corporate spending on conventions and business travel could be driven by many factors, such as perceived or actual general economic conditions; any further weaknesses in the job or housing market; additional credit market disruptions; high energy, fuel and food costs; the increased cost of travel; the potential for bank failures; perceived or actual disposable consumer income and wealth; fears of recession and changes in consumer confidence in the economy; or fears of war and future acts of terrorism. These factors could reduce consumer and corporate demand for the luxury amenities and leisure activities of our customers, thus imposing additional limits on pricing and harming our operations.
Regulations Affecting Casinos. Casinos are subject to extensive regulation and the cost of compliance or failure to comply with such regulations may have an adverse effect on their business, financial condition, results of operations or cash flows. Casinos are required to obtain and maintain licenses from the jurisdictions in which they operate, and are subject to extensive background investigations and suitability standards. In some cases, a casino license may be subject to revocation at any time by government officials. There can be no assurance that our prospective casino customers will be able to obtain new licenses or renew any of their existing licenses, or that if such licenses are obtained, that such licenses will not be conditioned, suspended or revoked. The loss, denial or non-renewal of any of their licenses could have a material adverse effect on their and our business, financial condition, results of operations or cash flows.
Casinos are Subject to Anti-Money Laundering Laws. Our prospective casino customers will deal with significant amounts of cash in their operations and will be subject to various reporting and anti-money laundering regulations. Any violation of anti-money laundering laws or regulations, or any accusations of money laundering or regulatory investigations into possible money laundering activities, by any of the properties, employees, or customers of our prospective casino customers could have a material adverse effect on their financial condition, results of operations or cash flows.
Travel Concerns. Casinos are sensitive to the willingness of customers to travel. Only a small amount of our potential casino customers' business will be generated by local residents. Most of their customers travel to reach their properties. Acts of terrorism may severely disrupt domestic and international travel, which would result in a decrease in customer visits to our potential customers' properties. Regional conflicts could have a similar effect on domestic and international travel. We cannot predict the extent to which disruptions in air or other forms of travel as a result of any further terrorist act, outbreak of hostilities or escalation of war would have on our potential casino customers' financial condition, results of operations or cash flows.
Win Rates. Win rates for casinos gaming operations depend on a variety of factors, some beyond their control. Consequently, the winnings of a casino's gaming customers could exceed the casino's winnings. The gaming industry is characterized by an element of chance. In addition to the element of chance, win rates are also affected by other factors, including the players' skill and experience, the mix of games played, the financial resources of the players, the spread of table limits, the volume of bets placed and the amount of time played.
Our potential casino customers' gaming profits are expected to mainly derive from the difference between their casino winnings and the casino winnings of their gaming customers. Since there is an inherent element of chance in the gaming industry, our potential casino customers will not have full control over their winnings or the winnings of their gaming customers. If the winnings of their gaming customers exceed their winnings, they may record a loss from gaming operations, which could have a material adverse effect on their (and our) business, financial condition, results of operations and cash flows.
Fraud and Cheating Issues. Casinos face the risk of fraud and cheating. Our potential casino customers' will most likely face attempts by some of their customers to commit fraud or cheat in order to increase winnings. Acts of fraud or cheating could involve the use of counterfeit chips or other tactics, possibly in collusion with a casino's employees. Internal acts of cheating could also be conducted by employees through collusion with dealers, surveillance staff, floor managers or other casino or gaming area staff.
Failure to discover such acts or schemes in a timely manner could result in losses to our potential casino customers gaming operations. In addition, negative publicity related to such schemes could have an adverse effect on our potential casino customers' reputations, likely causing a material adverse effect on their (and our) business, financial condition, results of operations and cash flows.
Limited Markets. Because we expect to be dependent primarily upon gaming operations in two markets, Central and South America, initially in Columbia, for all of our cash flow, we will be subject to greater risks than competitors with more casino customers or which operate in more markets. We do not currently have any casino equipment leasing operations. As a result, we do not have any current cash flow from operations.
Given that our operations are initially expected to be conducted only in Columbia, we will be subject to greater degrees of risk than competitors with more operating properties or that operate in more markets. The risks to which we will have a greater degree of exposure will include the following:
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Local economic and competitive conditions;
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Inaccessibility due to inclement weather, road construction or closure of primary access routes;
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Decline in air passenger traffic due to higher ticket costs or fears concerning air travel;
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Changes in local and state governmental laws and regulations, including gaming laws and regulations;
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Natural or man-made disasters, or outbreaks of infectious diseases;
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A decline in the number of visitors to San Andres Isla, Columbia, where we expect to commence operations.
Tax Laws and Regulations. Changes in tax laws and regulations could impact our financial condition and results of operations. We will be subject to taxation and regulation by various governmental agencies, primarily in Columbia, and other Central and South American countries, and the United States (federal, state and local levels). From time to time, U.S. federal, state, local and foreign governments make substantive changes to tax rules and the application of these rules, which could result in higher taxes than would be incurred under existing tax law or interpretation. In particular, governmental agencies may make changes that could reduce the profits that we can effectively realize from our non-U.S. operations. Like most U.S. companies, our effective income tax rate will reflect the fact that income earned and reinvested outside the U.S. is taxed at local rates, which are often lower than U.S. tax rates. If changes in tax laws and regulations were to significantly increase the tax rates on non-U.S. income, these changes could increase our income tax expense and liability, and therefore, could have an adverse effect on our effective income tax rate, financial condition and results of operations.
Financial Markets Financing Concerns. Disruptions in the financial markets could have an adverse effect on our ability to raise additional financing. To expand our casino equipment leasing business, we will need to finance the purchase of new casino equipment. We currently do not have any arrangements to obtain debt or equity capital to finance new equipment purchases, and if we do not obtain such capital we may be unable to expand our anticipated operations.
Severe disruptions in the commercial credit markets in the recent past have resulted in a tightening of credit markets worldwide. Liquidity in the global credit markets was severely contracted by these market disruptions, making it difficult and costly to obtain new lines of credit or to refinance existing debt. The effect of these disruptions was widespread and difficult to quantify.
While economic conditions have recently improved, that trend may not continue and the extent of the current economic improvement is unknown. Any future disruptions in the commercial credit markets may impact liquidity in the global credit market as greatly, or even more, than in recent years.
Our business and financing plan may be dependent upon completion of future financings. If the credit environment worsens, it may be difficult to obtain any additional financing on acceptable terms, which could have an adverse effect on our ability to complete our planned projects, and as a consequence, our results of operations and business plans. Should general economic conditions not improve, if we are unable to obtain sufficient funding or applicable government approvals such that completion of planned projects is not probable, or should management decide to abandon certain projects, all or a portion of our investment to date in our planned projects could be lost and would result in an impairment charge.
Currency Risks. Our potential casino customers will be subject to currency risks. Our gaming equipment lease provides for lease payments in U.S. dollars, while our lessees will conduct business in the currency of the country where the lessee is located. Accordingly, our lessees' ability to make lease payments will be subject to our lessees' ability to convert the foreign currency into U.S. dollars. As a result, our lessee's ability to make lease payments will be subject to fluctuations in the exchange rate of the applicable foreign currency against the U.S. dollar, as well as local laws and regulations which may limit or impair a foreign person or entity's ability to convert the subject foreign currency to U.S. dollars.
Our Legal Rights and Remedies are Uncertain in the Event of a Default by a Lessee. In the event we are required to take any legal action under a lease of our casino equipment, such as to repossess our equipment, we would be required to do so in the courts, and under the laws, of the country where the equipment is located. The legal systems of foreign countries may not allow for the repossession of equipment as quickly and as cost-effectively as in the U.S., with the result that we may face greater delays and expenses in exercising any rights under our leases. Consequently, losses due to a default by a lessee may be greater than otherwise would be the case.
Conflict of Interest. Paul Parliament, our chairman, president, chief executive officer, and director, has an indirect conflict of interest inasmuch as he has a private business relationship with Game Touch Technologies Inc., a company controlled by one of our consultants and current major stockholder, Julios Kosta, from whom Mr. Parliament purchased gaming equipment. Game Touch has no business relationship with Goldland Holdings.
Competition
To the extent we expand leasing our casino equipment to more than one operator we will face competition from casino equipment suppliers, leasing affiliates of casino equipment suppliers, and independent leasing companies. Most of our potential competitors have far greater resources than we have and have far greater experience in the casino industry than we possess.
Markets and Major Customers
While all casinos need casino equipment, we define our market as casinos in Central and South America, which we believe is an underserved market.
Currently, we do not have any customers.
Going Concern
As of March 31, 2015, the registrant had an accumulated deficit during development stage of $22,306,945. During the three months ended March 31,, 2015, the registrant used net cash of $3,604 for operating activities. These factors raise substantial doubt about the registrant's ability to continue as a going concern.
While the registrant is attempting to commence operations and generate revenues, the registrant's cash position may not be significant enough to support the registrant's daily operations. Management intends to raise additional funds by way of a public or private offering. Management believes that the actions presently being taken to further implement our business plan and generate revenues provide the opportunity for the registrant to continue as a going concern. While the registrant believes in the viability of its strategy to generate revenues and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the registrant to continue as a going concern is dependent upon the registrant's ability to further implement its business plan and generate revenues.
Three Months Ended March 31, 2015, Compared to Three Months Ended March 31, 2014 Liquidity and Capital Resources Liquidity is the ability of a company to generate adequate amounts of cash to meet its needs for cash. The following table provides certain selected balance sheet comparisons between March 31, 2015, and December 31, 2014: March 31, 2015 December 31, 2014 Due (to) from related parties $ 9,715 $ (6,429) Accounts payable $ 123,442 $ 162,974 Notes payable $ 186,146 $ 68,500 Director's loan $ 39,783 $ 56,847 |
Operating activities
There was no revenue during this reporting period
Investing activities
None that have not already been reported.
Financing Activities
On January 8, 2015 Pierre Quilliam the then CEO authorized without Board of Directors approval or knowledge, a company loan in the amount of $53,500 from KBM Worldwide, Inc. A convertible promissory note was issued at an interest rate of 8% per annum and the note was due on October 12, 2015. The loan currently has a principle balance of $25,000 and arrangements to pay out the loan in full have been made with KBM to do so as soon as Golding Holdings has excess funds.
The loan in favor of KBM Worldwide Inc. advanced on Dec. 4, 2014 in the amount of $68,500 was fully repaid in May 2015.
Seasonality of Business
Because we intend to lease our gaming equipment pursuant to master leases, we do not expect that our revenues and earnings from our casino equipment line of business will be affected by seasonal factors. However, casino lessees may be located in resort or vacation locations, which make their operations subject to seasonal fluctuations, which may affect our cash flows.
Impact of Inflation
We are affected by inflation along with the rest of the economy. Specifically, our costs to operate a company whose shares are publicly traded.
Adequacy of Working Capital
We will apply great efforts to raise though equity or debt offerings what we feel is sufficient working capital for our intended business plan by various means. If we are not able to raise additional capital, we would not be able to continue operations and our business may fail.
Our Financial Results May Be Affected by Factors Outside of Our Control
Our future operating results may vary significantly from quarter to quarter due to a variety of factors, many of which are outside our control. Our anticipated expense levels are based, in part, on our estimates of future revenues and may vary from projections. We may be unable to adjust spending rapidly enough to compensate for any unexpected revenues shortfall. Accordingly, any significant shortfall in revenues in relation to our planned expenditures would materially and adversely affect our business, operating results, and financial condition.
Further, we believe that period-to-period comparisons of our operating results are not necessarily a meaningful indication of future performance.
Adequacy of Working Capital
We hope to generate sufficient capital to fund our business plan through investments in our securities, revenues from operations, or borrowings. If we are not able to raise additional capital as described above, we would not be able to continue and our business would fail. As of the date of this report, we do not have any commitments for financing.
Critical Accounting Policies
Our financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles in the United States. Preparing financial statements requires management to make estimates and assumptions that impact the reported amounts of assets, liabilities, revenue, and expenses.
These estimates and assumptions are affected by management's application of accounting policies. Critical accounting policies include revenue recognition and impairment of long-lived assets.
We recognize revenue in accordance with Staff Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements." Sales are recorded when products are shipped to customers. Provisions for discounts and rebates to customers, estimated returns and allowances and other adjustments are provided for in the same period the related sales are recorded.
We evaluate our long-lived assets for financial impairment on a regular basis in accordance with Statement of Financial Accounting Standards No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets" which evaluates the recoverability of long-lived assets not held for sale by measuring the carrying amount of the assets against the estimated discounted future cash flows associated with them. At the time such evaluations indicate that the future discounted cash flows of certain long-lived assets are not sufficient to recover the carrying value of such assets, the assets are adjusted to their fair values.