MONSTER PRODUCTS, INC.

CIK:0001675583|SEC Filings

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Income Statement [Abstract]
Net sales	$ 9,159	$ 13,133	$ 34,873	$ 60,137
Cost of sales	7,653	9,721	22,810	35,569
Gross profit	1,506	3,412	12,063	24,568
Selling, general and administrative expenses	7,159	10,558	39,482	34,523
Loss from operations	(5,653)	(7,146)	(27,419)	(9,955)
Other income (expenses)
Interest expense	(465)	(667)	(2,783)	(2,328)
Gain/(loss) from foreign currency transactions	(880)	503	(699)	279
Other, net	57	40	(277)	(75)
Loss before income taxes	(6,941)	(7,270)	(31,178)	(12,079)
Income tax expense	17	28	90	151
Net loss	$ (6,958)	$ (7,298)	$ (31,268)	$ (12,230)
Net loss per share:
Basic	$ (0.02)	$ (0.02)	$ (0.10)	$ (0.04)
Diluted	$ (0.02)	$ (0.02)	$ (0.10)	$ (0.04)
Shares used to compute net loss per share:
Basic	314,888,000	307,485,000	306,272,000	307,843,000
Diluted	314,888,000	307,485,000	306,272,000	307,843,000

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	9 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Cash flows from operating activities
Net loss	$ (31,268)	$ (12,230)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation and amortization	987	956
Loss (gain) on sale of property and equipment	(60)	(14)
Accounts receivable allowances and reserves	(11,427)	(10,695)
Cumulative translation adjustment	273	(466)
Deferred rent obligations		(364)
Changes in operating assets and liabilities
Accounts receivable	13,709	11,833
Inventories	(1,459)	13,320
Prepaid expenses and other assets	(10,238)	(1,215)
Accounts payable	(4,967)	(1,326)
Accrued liabilities	(1,442)	(6,903)
Net cash used in operating activities	(45,892)	(7,104)
Cash flows from investing activities
Acquisition of property and equipment, net	(210)	(742)
Proceeds from sale of property and equipment	60	40
Acquisition of trademarks, net	(2)	28
Change in restricted cash	(1)	208
Net cash used in investing activities	(92)	(423)
Cash flows from financing activities
Repurchases of common stock	(3)	(3)
Borrowings under accounts receivable factoring arrangement	9,068	18,487
Borrowings under notes payable to shareholders	58,955	6,236
Repayments on accounts receivable factoring arrangement	(8,290)	(23,190)
Repayments on notes payable to shareholders	(16,146)	(1,316)
Net cash provided by financing activities	43,584	214
Effect of exchange rate changes on cash and cash equivalents	(93)	(18)
Net decrease in cash and cash equivalents	(2,493)	(7,331)
Cash and cash equivalents, Beginning of period	5,386	13,007
Cash and cash equivalents, End of period	2,893	5,676
Supplemental disclosure of non-cash financing activities
Conversion of shareholder's notes payable to preferred stock	$ 92,574

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2018	Sep. 30, 2017
Current assets
Cash and cash equivalents	$ 2,893	$ 5,386
Restricted cash	502	501
Accounts receivable, net	31,951	31,729
Accounts receivable assigned	1,050	3,554
Factoring receivable		149
Inventories, net	10,142	8,683
Prepaid expenses and other current assets	14,427	3,501
Total current assets	60,965	53,503
Property and equipment, net	1,389	1,883
Trademarks, net	4,250	4,531
Related party receivable	1,944	2,005
Other assets	2,827	3,515
Total assets	71,375	65,437
Current liabilities
Accounts payable	8,254	13,221
Accrued liabilities	65,790	70,220
Notes payable to shareholders	29,382	58,465
Factoring payable	629
Total current liabilities	104,055	141,906
Notes payable to shareholders, non-current	4,641	21,044
Other liabilities	1,587	2,878
Total liabilities	110,283	165,828
Commitments and contingencies (Note 8)
Shareholders' deficit
Preferred stock and additional paid-in capital, $0.001 par value, 25,000,000 shares authorized; 10,007,981 shares issued and outstanding at June 30, 2018	92,574
Common stock and additional paid-in capital, $0.001 par value, 800,000,000 shares authorized; 317,150,001 shares issued and outstanding at June 30, 2018; 725,374,971 shares authorized; 303,054,554 shares issued and outstanding at September 30, 2017	77,761	77,764
Accumulated deficit	(200,285)	(169,017)
Accumulated other comprehensive loss	(8,958)	(9,138)
Total shareholders' deficit	(38,908)	(100,391)
Total liabilities and shareholders' deficit	$ 71,375	$ 65,437