Results of Operation for the Fiscal Year ended December 31, 2012
Service Revenue
Service Revenues were $4,268,379 and $847,344 for the twelve months ended December 31, 2012 and 2011, respectively. The increase is due to recognizing revenue from our customers.
Cost of Service
Cost of Service was $4,398,145 and $649,937 for the twelve months ended December 31, 2012 and 2011, respectively. The increase is due to the development, integration and hosting of e-commerce solutions for our customers.
Operating Expenses
General and administrative expenses: General and administrative expenses were $828,635 and $1,204,250 for the twelve months ended December 31, 2012 and 2011, respectively. The decrease is due to the completion of our previous corporate restructuring.
Stock-based compensation: Stock-based compensation expenses were $383,333 and $875,000 for the twelve months ended December 31, 2012 and 2011, respectively.
The decrease is due to cancellation of share options to our former CEO.
--------------------------------------------------
Interest Expense
Interest expense was $0 and $18,007 for the twelve months ended December 31, 2012 and 2011, respectively. The decrease is due to the conversion of the accrued and unpaid interest, and the principal amount of $250,000 pursuant to the convertible debenture issued by the Company on November 11, 2008.
Net Loss
The Company had a net loss of $1,338,801 for the twelve months ended December 31, 2012 as compared to a net loss of $1,899,850 for the twelve months ended December 31, 2011. The decrease is due to the completion of our previous corporate restructuring.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.