On December 28, 2010, We acquired certain commercial property located at 3898 Lafayette Road, Indianapolis, Indiana 46224. The property currently houses a 14 movie theatre complex, which is owned and operated by us and a grocery store, which is owned and operated by an independent third party, who has an existing lease with us.
As a “smaller reporting company” we are not required to respond to this item.
In recent years we reorganized into three holding companies, for our entertainment, insurance agency and prescription operations. In 2010 we purchased our first property in Indianapolis, Indiana that contains the Georgetown 14 Theater. Revenues for 2011 for FullCircle Registry, Inc. were predominately from those operations. FullCircle Insurance Agency, Inc. and FullCircle Prescriptions, Inc. are currently awaiting funding to begin operations.
Revenues during the twelve months ended December 31, 2011 were $1,288,330 with cost of sales of $616,484 yielding a gross profit of $671,846 compared to revenues of $1,283 with cost of sales of $95 yielding a gross profit of $1,188 for the same period in 2010.
Operating expenses and other costs during the twelve-month period ending December 31, 2011 were $929,244 resulting in an operating loss of $257,398 compared to the operating expenses of $276,101 resulting in an operating loss of $274,913 for the twelve months ending December 31, 2010.
In 2011 we began to experience revenues from our acquisition in Indianapolis. Our 2012 revenues are expected to be significantly higher because the road construction was completed in December 2011. Additional revenues may also occur in 2012 from anticipated acquisitions.
Revenues from FullCircle Prescription Services, Inc. are minimal because those marketing efforts are on hold because of the lack of funding. We are not able to develop operational materials, brochures, mailings, training materials and additional web pages until additional capital is available.
A large portion of our 2011 operating expenses were the result of SEC compliance requirements for our 2011 10K and three 10Q SEC filings. In addition, in 2011, we expensed $86,040 for the amortization of our database, and $161,786 was expensed for the depreciation of our Georgetown 14 property, which was included in our total operating expenses.
During 2010 we incurred expenses of $79,182 in professional fees including auditing, database assessment, legal, accounting, IT services and web design fees.
As of December 31, 2011, the Company had assets in the amount of $5,579,290 compared to assets in the amount of $5,731,840 at December 31, 2010. The Company had total assets principally consisting of $19,731 in cash, $10,000 note receivable, $5,881 accounts receivable, $5,414,616 in property and equipment related to the acquired movie theatre and $129,062 investment in the 68,000 name database. Total assets at December 31, 2010 consisted of $6,738 in cash, a $10,000 note receivable, $215,102 investment in the customer database and $5,500,000 in property and equipment.
On December 31, 2011 our net worth was $223,795 as compared to a net worth of $531,824 on December 31, 2010.
The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.
The current expansion of the Company’s business demands that significant financial resources be raised to fund capital expenditures, working capital needs, debt service and the cash flow deficits expected to occur once we continue our acquisition program. Current cash balances and the realization of accounts receivable will cover our operations at Georgetown 14 but will not be sufficient to fund planned mergers. Consequently, the Company is pursuing funding using our common stock. Upon the state of Kentucky approving our request to issue preferred shares we will resume the process of locating investors for those preferred shares.