Item 2 – Management’s Discussion and Analysis of Financial Condition and Results of Operations
First Quarter 2020 compared with First Quarter 2019
Key Financial Results
Earnings by product sales
|
|
|
Three months ended March 31,
|
|
Net sales volumes per product
|
|
|
2020
|
|
|
2019
|
|
Crude Oil Sales
|
|
|
$
|
616,000
|
|
|
$
|
1,917,178
|
|
Gas Oil Sales
|
|
|
|
1,166,000
|
|
|
|
-
|
|
Lubricants Sales
|
|
|
|
113,802
|
|
|
|
-
|
|
Hires & Freights Sales
|
|
|
|
252,080
|
|
|
|
194,500
|
|
Other Revenues/Discounts
|
|
|
|
-
|
|
|
|
11,000
|
|
Totals
|
|
|
$
|
2,147,882
|
|
|
$
|
2,122,678
|
|
Net loss attributable to Petrogress for first quarter 2020 was $(910,397) (($0.1897) per share), compared to a net income of $150,492 ($0.0393 per share) for the first quarter of 2019. (Amount of losses $494,593 related to Petrogress Inc and includes G/A expenses and derivative liabilities of the convertible notes).
Refer to the “Results of Operations” section beginning on page 14 for a discussion of our financial results.
Executive Overview
Petrogress, Inc., is based in Delaware and operates as a holding company and conducts its business through its wholly-owned subsidiaries: Petronav Carriers LLC., which manages day-to-day operations of its beneficially-owned affiliated tanker fleet; and Petrogress Int’l LLC., which is a holding company for subsidiaries currently conducting business in Greece, Cyprus and Ghana, and provides management of crude oil purchases and sales;
Business Environment and Outlook
Petrogress, is an oil energy and sea transportation company with business activities in the following countries: Greece, Cyprus and Ghana. Our earnings currently depend primarily on the profitability of our crude oil sales. The biggest factor affecting the results of operations is the price of crude oil. The price of crude oil has fallen significantly since mid-year 2019. The downturn in the price of crude oil has impacted the company's results of operations, cash flows, leverage, capital and exploratory investment program and production outlook. A sustained lower price environment could result in the impairment or write-off of specific assets in future periods. We have reacted to the downturn by effecting reductions in operating expenses, pacing and re-focusing of capital and exploratory expenditures. We anticipate that crude oil prices will increase in the future, as continued growth in demand and a reduction in supply growth should bring global markets into balance. However, the timing or sustainability of any such increase in prices is unknown. In the Company's downstream business, crude oil is the largest cost component of refined products. Nevertheless, it is our objective to deliver competitive results and shareholder value in any business environment.
Our midstream segment relies and depends on our crude oil sales contracts to keep our vessels employed. We rely primarily on the revenues generated from our business of physical supply of crude oil and marketing of refined products to our end customers.
* On November 16, 2016, Petrogress, Inc., filed Articles of Merger and Plan of Merger in Florida and Delaware to change the Company’s domicile by merging with and into a Delaware corporation formed solely for the purpose of effecting the reincorporation. On July 9, 2018, the Company filed an amendment (the "Amendment") to the Company's Certificate of Incorporation with the Delaware Secretary of State to (a) effect a reverse stock split of the Company's Common Stock at a ratio of one-for-100, (b) reduce the number of authorized shares of Common Stock from 490,000,000 to 19,000,000 and (c) reduce the number of authorized shares of Preferred Stock from 10,000,000 to 1,000,000. The Amendment took effect on July 18, 2018. There was no change in the par value of the Company's Common Stock or Preferred Stock as a result of the Amendment.
The company continually evaluates opportunities to dispose of assets that are not expected to provide sufficient long-term value or to acquire assets or operations complementary to its asset base to help augment the company’s financial performance and value growth. Asset dispositions and restructurings may result in significant gains or losses in future periods. The company continually evaluates opportunities to dispose of assets that are not expected to provide sufficient long-term value or to acquire assets or operations complementary to its asset base to help augment the company’s financial performance and value growth. Asset dispositions and restructurings may result in significant gains or losses in future periods.
Response to Market Conditions and COVID-19
During the first quarter of 2020, travel restrictions and other constraints on economic activity were implemented in many locations around the world to limit the spread of the COVID-19 virus. As a result, demand for our products has fallen steeply and commodity prices, including crude oil and other petroleum products, have followed suit. The drop in commodity prices is expected to negatively impact the company’s future financial and operating results. Due to the rapidly changing environment, there continues to be uncertainty and unpredictability around the impact of the COVID-19 pandemic on our results, which could be material. Petrogress, entered into this crisis with a weak balance sheet and low cash liquidity. Accordingly, to protect its long-term health and value, the company is responding to such market condition by adjusting items it can control. Additionally, the company has suspended its repayments of short-terms debts and reduced also the purchase of the crude oil from its suppliers. A number of our vessels crew dismissed to mitigate the daily non-operating expenses of our fleet. Together, these actions are consistent with our financial priorities: to protect our ongoing projects, to prioritize capital spend that drives long-term value and to maintain our position in the energy and shipping market. The company relies in its receivables in order to continue with a sufficient liquidity on its operations.
Refer to the “Cautionary Statements Relevant to Forward-Looking Information” on Page 2 and to “Risk Factors” in Part II, Item 1A, on pages 22 for a discussion of some of the inherent risks that could materially impact the company’s results of operations or financial condition.
Operating sectors
Our business operates in the downstream and midstream sectors of the energy industry, where we acquire and supply crude oil, and engage in the refining and marketing of refined products and lubricants. As a supplier, we procure crude oil from our direct sources and deliver by our tankers fleet to buyers’ destinations. With service centers in East Mediterranean and West Africa, we believe that we are one of a limited number of independent physical suppliers that owns and operates a fleet of supplying vessels and conducts physical supply operations in multiple jurisdictions.
We provide our customers with services that require sophisticated logistical operations designed to meet their strict oil quality and delivery scheduling needs. We believe that our extensive experience and management systems allow us to meet our customers' specific requirements when they purchase and take delivery of crude oil, refined products and lubricants around the areas in which we operate. We have devoted our efforts to building a global brand and believe that our customers recognize our brand as representing high quality service and products at each of our locations. We also perform our technical ship operations in-house, which helps us maintain high levels of customer service. Throughout our history, we have expanded our business capabilities through strategic alliances, select business and vessel acquisitions, and the establishment of new service centers.
The company maintain its principal marketing and operating offices at 1, Akti Xaveriou, 18538 Piraeus, Greece. Our telephone number at that address is +30 (210) 459-9741 and our corporate address and registered agent in Delaware is 1013 Centre Road, Suite 403-A, Wilmington, DE 19805 – USA.
Other Businesses
Effected as on November 2019, the company concluded the negotiations to lease three Gas refilling stations in the Mainland of South Greece. The procedures for the obtaining the operating licenses from the local authorities are in progress, simultaneously with the preparation of gas stations designs and drawings in order to commence the modernization and renovation under our brand names. We estimate to complete and have them ready for operations within three months’ time. The gas Stations shall be operated by our Hellenic branch in Greece and we expect to be ready by June 2020.
Our key business segments
The following are descriptions of our recent initiatives undertaken in each of our key business segments:
Upstream; Earnings for the upstream segment are closely aligned with industry prices for crude oil. Crude oil prices are subject to external factors over which the company has no control, including product demand connected with global economic conditions, industry production and inventory levels, technology advancements, production quotas or other actions imposed by the Organization of Petroleum Exporting Countries (OPEC) or other producers, actions of regulators, weather-related damage and disruptions, competing fuel prices, natural and human causes beyond the company's control such as the COVID-19 pandemic, and regional supply interruptions. The company is actively managing its schedule of work, contracting, procurement, and supply chain activities to effectively manage costs, ensure supply chain resiliency and continuity, and support operational goals. The spot markets for many services and materials are softening in response to the economic impact of the COVID-19 pandemic, including the drastic reductions in demand for petroleum products, including gasoline and fuel, among others, and in crude oil prices, which have resulted in significant reductions in economic activity and associated spending in the energy sector. Commodity prices have fallen below break-even levels in many regions.
Downstream: As on February 2018, our Partnership agreement with Platon Ghana Oil Refinery (PGOR) -an unrelated third party- is still ongoing and renewed on an annual basis and pursuant its terms Petrogress will feed and supply the crude oil for storage, refinement, marketing and distribution in Ghana jointly with PGOR. The storage capacity under the Partnership Agreement is 24,000 tons and the monthly processing capacity of the refinery is 10,000 tons. Petrogress and Platon both plans to invest additional funds to upgrade the processing monthly capacity into refined products of Gas Oil, Naphtha, and fuel in view of the high local demand. Under the Platon Partnership Agreement, all expenses of the partnership operations are shared by both Petrogress and Platon. After deducting the operating/processing expenses, the net profits from the sale of the products are split evenly between Petrogres and Platon. As of the date the Platon Partnership Agreement was executed, Petrogress ceased other sales of crude to third customers in West Africa. During the year the company expanded its operations to other sectors, engaging into gas-stations operator and lubricants distributor.
Earnings for the downstream segment are closely tied to margins on the refining, manufacturing and marketing of products that include gasoline, diesel, fuel oil and lubricants additives, and petrochemicals. Industry margins are sometimes volatile and can be affected by the global and regional supply-and-demand balance for refined products and petrochemicals, and by changes in the price of crude oil, other refinery and petrochemical feedstocks. Industry margins can also be influenced by inventory levels, geopolitical events, costs of materials and services, refinery or chemical plant capacity utilization, maintenance programs, and disruptions at refineries resulting from unplanned outages due to severe weather, fires or other operational events. Other factors affecting profitability for downstream operations include the reliability and efficiency of the company’s refining, marketing, the effectiveness of its crude oil supply functions, and the volatility of tanker-charter rates for the company’s shipping operations, which are driven by the industry’s demand for crude oil and product tankers. Other factors beyond the company’s control include the general level of inflation and energy costs to operate the company’s refining process and marketing, including the changes in tax laws and regulations.
The company’s most significant marketing areas are the West Coast of Africa and East Mediterranean where Petrogress affiliates have significant ownership interests, representations and partnership agreements, in these areas.
Midstream; The outbreak of COVID-19 pandemic occurred the ceased of our entire fleet operations and employments which resulted the complete elimination of freight and hire incomes, while the fleet expenses remained on the same levels during and March, April and May 2020. Nevertheless, we believe the shipping industry will be rectified and return to the normal levels, therefore we still seek to expand our midstream operations in other international ocean routes by adding to our fleet larger and younger tanker vessels. We are monitoring the vessel market for opportunities while we are also working to secure the necessary funding for expansion. Our business strategy is based in part upon the expansion of our business to new, or within existing, markets. In order to fund future vessel acquisitions, expansion into new and existing markets and products, increased working capital levels, or capital expenditures, we will be required to use cash from operations, incur borrowings or raise capital through the sale of debt or equity securities in the public or private markets.
The company closely monitors developments in the financial and credit markets, the level of worldwide economic activity, and the implications for the Company of movements in prices for crude oil and refined products. Management takes these developments into account in the conduct of daily operations and for business planning.
The company continually evaluates opportunities to dispose of assets that are not expected to provide sufficient long-term value or to acquire assets or operations complementary to its asset base to help augment the company’s financial performance and value growth. Asset dispositions and restructurings may result in significant gains or losses in future periods.
Operating Developments
Noteworthy operating developments in recent months included the following:
●
|
Greece - complete the new 3 Gas/Fueling Stations and rest areas for which we estimate to be start operating by July 2020;
|
●
|
Greece – conclude the concession agreement with Gythio port authorities and take over the management of the port for the next 35 years;
|
●
|
Egypt – conclude the company’s partnership agreement with a national petroleum refinery for the sludges collection from all vessels calling the Egyptian ports;
|
●
|
Egypt – complete the final arrangements for the bunkering location at Port Said and shift-place one of our tankers in position to commence the bunkering operations in the area;
|
●
|
Ghana – conclude the partnership agreement with SONERGON, a manufacturing power-plants company and build the first Power-Plant in Ghana;
|
The said projects were interrupted due to COVID-19 outbreak as of March and during the second quarter of 2020 as a result of travel restrictions between the countries.
Results of Operations
The following section presents the results of operations and variances on a before-tax basis for the company’s business operations, as well as for “All Other.”
Our operating revenues are driven primarily of the commodities trading sales and our tankers fleet employment days during which our vessels are generating revenues, while our financial results are subject to a number of sectors and reflects to the following factors:
Cost of commodities; is the cost we purchase the oil products -mainly the crude oil- and such cost is based either on Brent Index prices or Fixed price, the quality and quantity of the product.
Commodities Operating Expenses; relates to products surveys before and after the shipment, bunkers supplied to the employment vessel, cargoes surveys, loading/unloading expenses, agency and representative services.
Shipping & Logistic Expenses; includes the sea freight and mobilization cost, the performed loading and discharging of the product, and any expenses occurred during the shipping time from the loading point up to unloading facilities.
Vessels Operating Expenses; includes crew wages and bonuses, their medical support and travelling, maintenance and repairs to the vessels hull and their machineries, expenses for supplies of spare-parts and consumable stores, paints, lubricants, fresh water, bunkers, agency services, etc.
General and Administrative Expenses; relates to our directors, officers and managers salaries and compensations, shore staff wages, employee’s federal insurance, offices lease and utilities, telecommunications, travelling and representations of our officers, our agency fees we pay to our branch’s offices in Greece, Cyprus, Ghana and Nigeria.
Corporate Expenses; are all company’s expenses and includes, our executive’s compensations, attorney’s fee, Auditors and accountant fees, Consultant’s and P/R fees, Transfer agents of our stock, miscellaneous.
Other factors may affect our Results of Operations; In addition to the said expenses there are factors beyond of our control which may affect seriously our operations results. Inasmuch as we trade also West Africa, which is considered as high risky area, we are expose in a serious amount of risks, such as piracies and hijacks, civil wars, stolen of properties, economy distress, and credit risks.
EBITDA and Adjustment; EBITDA represents net income before expenses, taxes and depreciation. Adjusted EBITDA represents net income before expense, taxes, taxes, depreciation and amortization of dry-docking.
|
|
Three months ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
Operating Earnings/ (losses)
|
|
$
|
(543,019
|
)
|
|
$
|
145,259
|
|
Operating losses of $(543,019) during the first quarter of 2020, compared to operating earnings of $205,024 for the same period in 2019. The decrease was primarily due to lower crude oil sales prices and the cease of operations as of March 31, 2020.
Consolidated Statement of Income
Sales of products provided in the below table:
|
|
|
Three Months Ended
March 31,
|
|
Net sales volumes per product
|
|
|
2020
|
|
|
2019
|
|
Crude Oil Sales
|
|
|
$
|
616,000
|
|
|
$
|
1,917,178
|
|
Gas Oil Sales
|
|
|
|
1,166,000
|
|
|
|
-
|
|
Lubricants Sales
|
|
|
|
113,802
|
|
|
|
-
|
|
Hires & Freights Sales
|
|
|
|
252,080
|
|
|
|
194,500
|
|
Other Revenues/Discounts
|
|
|
|
-
|
|
|
|
11,000
|
|
Totals
|
|
|
$
|
2,147,882
|
|
|
$
|
2,122,678
|
|
Cost of Goods Sold provided in the below table:
|
|
|
Three Months Ended
March 31,
|
|
Cost of goods sold
|
|
|
2020
|
|
|
2019
|
|
Crude Oil purchased costs
|
|
|
$
|
(572,000
|
)
|
|
$
|
(1,165,752
|
)
|
Gas Oil purchased costs
|
|
|
|
(745,513
|
)
|
|
|
-
|
|
Lubricants purchased costs
|
|
|
|
(35,697
|
)
|
|
|
-
|
|
Totals
|
|
|
$
|
(1,353,210
|
)
|
|
$
|
(1,165,752
|
)
|
●
|
Sales: Total operating sales for the three months ended March 31, 2020 and 2019, were $2,147,882 and $2,122,678, respectively, a decrease of $52 796 or approximately 2%.
|
●
|
Cost of goods sold: for the three months ended March 31, 2020 and 2019, cost of goods sold were $(1,353,210) and $(1,165,752), respectively, an increase of $187,458 or approximately 16%.
|
●
|
Corporate expenses: Corporate expenses mainly include the expenses incurred by Petrogress, Inc. Our Corporate expenses for the three months ended March 31, 2020 and 2019 were $75,748 and $5,063, respectively, an increase of $70,685 or approximately 1496%.
|
●
|
General and administrative expenses: For the three months ended March 31, 2020, General and administrative expenses increased to $1,098,716 compared to $542,872 for the three months ended March 31, 2019, an increase of $555,844 or approximately 202%.
|
●
|
Net income/ (loss) attributable PGI: For the three months ended March 31, 2020, the Company had a net loss of $(910,397) while for the three months ended March 31, 2019, the Company had a net income of $150,492, a decrease of $1,060,889 or approximately 605%.
|
●
|
EBITDA: For the three months ended March 31, 2020 amounted to $(922,744) compared to $145,259 to the three months ended March 31, 2019.
|
Consolidated results of Operation (after eliminations)
|
|
|
Three Months Ended
March 31,
|
|
|
|
|
2020
|
|
|
2019
|
|
Total Operating Revenues
|
|
|
$
|
2,147,882
|
|
|
$
|
2,122,678
|
|
Total Operating Expenses & Cost of Goods Sold*
|
|
|
$
|
(2,612,901
|
)
|
|
$
|
(1,977,419
|
)
|
* Operating expenses includes, corporate expenses, shipping & logistic, commodities purchase cost, fleet expenses, General and Administrative expenses, and Depreciation expense;
Summarized Financial Data – Subsidiaries
The management and operation of our business is performed directly and independently by each subsidiary. Assets, inventories, partnership interests, joint venture interests and contracts are held by the subsidiaries. Petrogress, Inc., the parent company, does not have revenues while it suffers all the necessary operating and general and administrative expenses in order to comply with the regulatory requirements of the SEC.
Petrogress Int’l LLC. (PIL)
Petrogress Int’l LLC. (PIL), performs most of the trading of the oil products. PIL, is the company which serves as a holding company for conducting business across the world through its affiliates and subsidiaries.
Summarized financial information is presented in the following table:
|
|
|
Three Months Ended
|
|
|
|
|
March 31
|
|
|
|
|
2020
|
|
|
2019
|
|
Sales and other operating revenues
|
|
|
$
|
1,381,501
|
|
|
$
|
1,951,538
|
|
Cost and other expenses
|
|
|
|
(1,321,908
|
)
|
|
|
(1,384,724
|
)
|
Net income attributable to Petrogress Int’l LLC.*
|
|
|
$
|
59,593
|
|
|
$
|
566,814
|
|
________
* 100% Net income attributable to Petrogress, Inc.
Petronav Carriers LLC. (PCL)
Petronav Carriers LLC., (PCL) is the company that serves as the manager and operator of our tanker fleet of four vessels wholly owned by its five subsidiaries. PCL operates and charter the tankers fleet to PIL and third-party charterers.
Summarized financial information is presented in the following table:
|
|
|
Three Months Ended
|
|
|
|
|
March 31
|
|
|
|
|
2020
|
|
|
2019
|
|
Sales and other operating revenues
|
|
|
$
|
447,080
|
|
|
$
|
367,333
|
|
Cost and other expenses
|
|
|
|
(778,817
|
)
|
|
|
(632,751
|
)
|
Net income/ (loss) attributable to Petronav Carriers LLC. *
|
|
|
$
|
(331,737
|
)
|
|
$
|
(265,418
|
)
|
________
* 100% Net income/ (loss) attributable to Petrogress, Inc.
Petrogress Africa Co. Ltd. (PGAF)
Petrogres Africa Co. Ltd., (PGAF) is the company that holds a Ghanaian permit and is authorized to conduct local sales of oil trade and servicing as a ship agent within Ghana ports. PGAF, provides the agency and the attendance of our fleet in all Ghanaian ports, including the support of any repairs and supplies to our vessels. In addition, PGAF is the distributor of our lubricants.
Summarized financial information is presented in the following table:
|
|
|
Three Months Ended
|
|
|
|
|
March 31
|
|
|
|
|
2020
|
|
|
2019
|
|
Sales and other operating revenues
|
|
|
$
|
1,194,252
|
|
|
$
|
15,000
|
|
Cost and other expenses
|
|
|
|
(1,317,724
|
)
|
|
|
(67,331
|
)
|
Net income/ (loss) attributable to Petrogres Africa Co. Ltd.*
|
|
|
$
|
(132,472
|
)
|
|
$
|
(52,331
|
)
|
_______
* 90% Net income/ (loss) attributable to Petrogress Int’l LLC.
Petrogress Hellas Branch (PGH)
Petrogress Hellas (PGH) is the branch of PIL in Greece and operates-monitoring and managed the entire day-to-day activities of the company’s subsidiaries. Through PGH, PIL has commenced the Gas-Fueling Stations in Greece.
Summarized financial information is presented in the following table:
|
|
|
Three Months Ended
|
|
|
|
|
March 31
|
|
|
|
|
2020
|
|
|
2019
|
|
Sales and other operating revenues
|
|
|
$
|
37,368
|
|
|
$
|
23,360
|
|
Cost and other expenses
|
|
|
|
(69,903
|
)
|
|
|
(40,392
|
)
|
Net income/ (loss) attributable to Petrogress Hellas Co.*
|
|
|
$
|
(32,535
|
)
|
|
$
|
(17,032
|
)
|
_______
100% Net income/ (loss) attributable to Petrogress Int’l LLC.
Petrogress, Inc. (PGI)
Petrogress, Inc. (PGI) is the parent holding company of the group and doesn’t make any revenues from operations while it suffers all the necessary operating and general and administrative expenses in order to comply with the regulatory requirements of SEC. The following table presents the results of equity interest PGI has into the subsidiaries:
|
|
|
Three Months Ended
|
|
|
|
|
March 31
|
|
|
|
|
2020
|
|
|
2019
|
|
Sales and other operating revenues
|
|
|
$
|
-
|
|
|
$
|
-
|
|
Corporate, Administrative and other expenses
|
|
|
|
(494,593
|
)
|
|
|
(101,267
|
)
|
Net income/ (loss) attributable to Petrogress, Inc.*
|
|
|
$
|
(494,593
|
)
|
|
$
|
(101,267
|
)
|
_______
Net income/ (loss) attributable from ownership interest of the subsidiaries.
Revenue Concentrations
The following table is a summary of customers who accounted for more than ten percent (10%) of the Company’s revenues for the three months ended March 31, 2020 and 2019:
Customer
|
|
|
March 31, 2020
|
|
|
March 31, 2019
|
|
A
|
|
|
|
29
|
%
|
|
|
94
|
%
|
B
|
|
|
|
25
|
%
|
|
|
*
|
|
C
|
|
|
|
18
|
%
|
|
|
*
|
|
D
|
|
|
|
11
|
%
|
|
|
*
|
|
Summary of customers who accounted for more than ten percent (10%) of the Company’s accounts receivable for the periods ended March 31, 2020 and December 31, 2019 is showing on the below table:
Customer
|
|
|
March 31, 2020
|
|
|
December 31, 2019
|
|
A
|
|
|
|
29
|
%
|
|
|
55
|
%
|
B
|
|
|
|
25
|
%
|
|
|
*
|
|
C
|
|
|
|
13
|
%
|
|
|
23
|
%
|
D
|
|
|
|
11
|
%
|
|
|
*
|
|
|
●
|
None of the balances listed in the table above have become overdue as of March 31, 2020.
|
|
●
|
Amounts indicated with an * denote amounts less than 10%.
|
Liquidity & Capital Resources
Our main sources of liquidity are cash and cash equivalents, accounts receivable and internally generated cash flow from operations. At March 31, 2020, we had a working capital of $2,336,944 consisting of $387,622 in cash and cash equivalents, $2,049,256 in accounts receivable, $378,545 in claims receivable, $1,235,963 in inventories and $2,191,023 in prepaid expenses and other current assets.
For the three months ended March 31, 2020, net cash provided by operating activities was $344,086 compared to $605,215 of net cash used in operating activities for the three months ended March 31, 2019.
Assets included in the calculation of the Company’s working capital have decreased by $988,714 mainly from the decrease in inventories which have decreased by $648,649. This decrease has been financed mainly by our net income and the increase of our liabilities included in working capital, namely the increase in Convertible promissory notes and Derivative liabilities which have increased by $59,750 and $256,808 respectively, during the three months ended March 31, 2020.
The company’s future debt level is dependent primarily on results of operations, cash that may be generated from asset dispositions, the capital program, lending commitments to affiliates, and shareholder contributions. Our need for capital resources is driven by our expansion plans, ongoing maintenance and improvement of our vessels, support of our operational expenses, corporate overhead and the expenses we suffer in order to comply with the regulatory requirements of SEC. Specifically, Petrogress, Inc., the parent company, does not have revenues while it suffers all the necessary operating and general and administrative expenses to comply with the regulatory requirements of the SEC.
Cash and Cash Equivalents; The following table presents sources and use of cash and cash equivalents:
|
|
Three Months Ended March 31,
|
|
Sources of cash and cash equivalents
|
|
2020
|
|
|
2019
|
|
Operating activities
|
|
$
|
344,086
|
|
|
$
|
605,215
|
|
Borrowing
|
|
|
-
|
|
|
|
-
|
|
Others
|
|
|
-
|
|
|
|
-
|
|
Total sources of cash and cash equivalents
|
|
$
|
344,086
|
|
|
$
|
605,215
|
|
Management seeks to secure the necessary financing for the expansion of Company’s operations. Based on our current plan, we believe our expected cash flows from operations will be sufficient to finance our present activities and capital expenditures only for a period of the next 6 months. The company needs to raise a reasonable finance in order to expand its operations, increase the oil sales and support its projects-operations.