|3 Months Ended|
Mar. 31, 2019
NOTE 2 LIQUIDITY
As reflected in the accompanying unaudited consolidated financial statements, the Company had a net income of $44,169 for the three months ended March 31, 2019. During the same period, cash used in operating activities was $1,500,159. The positive working capital and accumulated deficit as of March 31, 2019 were $1,002,673 and $30,225,664, respectively. In previous financial reports, the Company had raised substantial doubt about continuing as a going concern. This was principally due to a lack of working capital prior to the raise of approximately $11 million closed in late 2017. In addition, the Company was carrying significant debt obligations including a senior secured note with cash interest payments.
After the 2017 raise, management paid down all debt which eliminated monthly obligations for interest payments other than for normal course of business financing, secured sufficient working capital for ongoing operations and was successful in closing business and establishing a backlog such that we were breakeven or profitable in two of the last four quarters including the current quarter. The Company has been successful in increasing its working capital cushion with $1,650,000 in warrant executions during the current quarter and has secured another approximately $475,000 in further warrant conversions.
Management now believes that these actions have alleviated the substantial doubt for the Company to continue as a going concern and will continue to grow its business and achieve profitability without the requirement to raise additional capital for existing operations. Ultimately the continuation of the Company as a going concern is dependent upon the ability of the Company to execute the plan described above, generate sufficient revenue and to attain consistently profitable operations. Additionally, the Company expects that with the current financial plan, further warrant executions can be expected and in conjunction with this, a number of existing shareholders have requested the opportunity to invest further money to build shareholder equity by a further $3.5 million. Management will continue to evaluate these plans in future filings.
The entire disclosure when substantial doubt is raised about the ability to continue as a going concern. Includes, but is not limited to, principal conditions or events that raised substantial doubt about the ability to continue as a going concern, management's evaluation of the significance of those conditions or events in relation to the ability to meet its obligations, and management's plans that alleviated or are intended to mitigate the conditions or events that raise substantial doubt about the ability to continue as a going concern.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef