Business Context and Reporting Period
This Form 10-Q covers the quarterly period ended June 30, 2009, for Xcellink International Inc. (formerly Blue Bird Exploration Company). The company is a Delaware corporation classified as a shell company and a smaller reporting company. Originally an exploration-stage entity, the company pivoted in April 2009 to acquire a global license for patented electronic payment technologies, intending to replace traditional credit and debit card systems. The company has no employees other than its President and Director.
Key Financial Metrics
| Metric | Value (Six Months Ended June 30, 2009) | Value (Three Months Ended June 30, 2009) |
|---|---|---|
| Revenue | $0 | $0 |
| Net Loss | $(14,505) | $(2,606) |
| Cash and Cash Equivalents | $624 (as of June 30, 2009) | N/A |
| Total Assets | $624 | N/A |
| Total Liabilities | $63,139 | N/A |
| Stockholders' Equity (Deficit) | $(62,515) | N/A |
| Net Cash Used in Operating Activities | $(10,196) | N/A |
| Net Cash Provided by Financing Activities | $10,133 | N/A |
| Weighted Average Shares Outstanding | 104,160,000 | 104,160,000 |
Note: The filing does not provide specific margin data as there is no revenue. The company is in an exploration/pre-revenue stage.
Material Changes vs. Prior Period
- Net Loss: The net loss for the six months ended June 30, 2009, was $(14,505), compared to $(13,543) for the same period in 2008, representing a slight increase in losses.
- Liabilities: Total liabilities increased from $48,697 at December 31, 2008, to $63,139 at June 30, 2009. This increase was driven primarily by a rise in amounts due to related parties (from $12,914 to $23,046) and accounts payable.
- Cash Position: Cash decreased slightly from $687 at the end of 2008 to $624 at June 30, 2009.
- Strategic Pivot: The company shifted focus from mineral exploration (Blue Bird Exploration) to electronic payment systems (Xcellink International) following a license agreement signed in April 2009.
Outlook, Risks, and Management Commentary
- Going Concern: The filing explicitly states that the company has not established an ongoing source of revenues sufficient to cover operating costs. The ability to continue as a going concern is dependent on obtaining adequate capital. If financing is not secured, the company may be forced to cease operations.
- Liquidity Crisis: With only $624 in cash and $63,139 in current liabilities, the company faces immediate liquidity constraints. Management notes that failure to secure funding within 30-60 days could result in a complete loss of shareholder funds.
- Plan of Operations: The company intends to generate revenue through licensing its intellectual property, servicing e-commerce sectors, and providing software support. However, management admits these plans are highly speculative and dependent on raising capital, which has historically been unsuccessful.
- Recent Corporate Actions: Post-period events include a share exchange agreement with Xcellink International Limited (BVI), a relocation of headquarters to Las Vegas, and the dismissal of the previous independent accounting firm (Moore & Associates) in favor of Seale and Beers, CPAs.
Investor Verification Checklist
- Verify the company's ability to secure immediate financing to cover the $63,139 in current liabilities and sustain operations beyond the next 60 days.
- Confirm the status and enforceability of the April 27, 2009, license agreement with Xcellink International Limited regarding the patented payment technologies.
- Investigate the reasons for the dismissal of the previous independent auditor (Moore & Associates) and the engagement of the new firm (Seale and Beers, CPAs).
- Assess the validity of the "shell company" status and the potential for reverse merger or asset acquisition activities given the recent share exchange agreement.
- Review the related party transactions, specifically the increase in amounts due to related parties, to ensure terms are arm's length.