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Key statistics
from XBRL data in SEC filingsAI briefing
from the latest 10-K, 10-Q and 8-K eventsNorth America Frac Sand, Inc. is a Florida-incorporated, OTC-QB traded company that currently holds frac sand mineral leases in Saskatchewan, Canada, and previously provided consulting services to aquatic farming operators in the U.S. Midwest.
What they do
The company was founded in 2007 as New Found Shrimp, Inc. and provided marketing and consulting services to independent aquatic farming operators in Indiana. In 2015, it acquired North America Frac Sand (CA) Ltd. and shifted focus to frac sand exploration on the Eagle Creek mineral leases covering approximately 30,000 acres in Saskatchewan. As of the 2018 filings, the company has no reported revenue and is not in active production.
Revenue drivers
- Frac sand mining (future) — The company holds the Eagle Creek mineral leases with indicated frac sand resources, but as of the filings has not generated revenue from sales or production.
- Consulting services (historical) — Prior to the pivot, the company provided marketing and consulting services to aquatic farming operators; annual revenue was reported as $1,750 in 2011 and $250 in 2012.
Recent performance
For the year ended December 31, 2017, the company reported a net loss of $251,514, an improvement from a net loss of $1,670,950 in 2016. Total liabilities increased to $825,444 at December 31, 2017, from $573,931 at December 31, 2016, while total assets were reported as zero. The company had an accumulated deficit of $36,421,654 as of December 31, 2017. As of March 31, 2018, total liabilities were $857,456 and shareholder equity was negative $857,456.
Strategy
Management's stated priority is to continue development and marketing of the frac sand project, which will require additional funding. The company completed an NI 43-101 report in May 2017, amended in March 2018, covering exploration on approximately 29,900 acres of the leased areas. The company intends to retain earnings to fund development and does not anticipate paying dividends. It is disputing a letter from Canadian Sandtech, Inc. regarding the legality of the NAFS-CA acquisition.
Risks
- Going concern — The company has sustained recurring losses and has an accumulated deficit of $36,421,654 as of December 31, 2017, raising substantial doubt about its ability to continue as a going concern.
- Liquidity and working capital deficit — At December 31, 2017, the company had a working capital deficit of $825,444 and stated it is presently not able to meet its obligations as they come due.
- Legal dispute — Canadian Sandtech, Inc. has disputed the legality of the acquisition of NAFS-CA from them, and the company has retained lawyers to dispute the allegation.
- No revenue and no assets — The company reported no revenue in recent years and total assets of $0 as of December 31, 2016, with no current production or sales of frac sand.
Outlook
Management states that the company will require additional funding for continuing the development and marketing of the frac sand project. The company has not announced any specific financing or production timeline. It intends to retain any earnings to fund development and does not anticipate paying dividends.