Magnate Ventures Inc. Files Interim, Unaudited Statement With SEDAR

Magnate Ventures Inc. [NEX: MGV.H] has filed its interim unaudited financial statements for the third quarter of fiscal year 2007, ending September 30th [PDF file]. As of that date, Magnate had $1,668,626 in cash and cash equivalents, as compared with $266,799 as of December 31, 2006, and $1,668,768 in working capital; working capital as of the end of 2006 was $231,704. Book value increased from 1.26 cents/share, as of December 31, 2006, to 5.00 cents/share as of Sept. 30/07. The statement of cash flows explains that the added cash came from the exercise of 14.51 million warrants, infusing $1,451,000 into Magnate's coffers in exchange for the issuance of 14.51 million more common shares at a price of 10 cents/share. Note 7 of the financial statements explains that a 6.5-for-1 consolidation was effected on Sept. 1st, 2006, and the financial statements were adjusted to reflect it.

There was no revenue for the third quarter of FY 2007, nor any for FY '07 so far. For 3Q FY '06, there was $24,058 in revenue, $22,240 of it in operating revenue ($93,443 and $90,327 respectively for the entire fiscal year '06.) Operating expenses were only $14,819 for 3Q '07, even though they were $362,080 for the first three quarters of FY '07. 3Q '06 expenses were $44,750, and expenses for the entire FY '06 were $152,439. $287,000 of those operating expenses were for stock-based compensation. The shrinkage in expenses was due to: a $31,303 shrink in selling, general and administrative expenses; the elimination of interest payments, which totaled $21,537 in 3Q '06; and, the elimination of amortization expense, which was $1,149 in 3Q '06.

The accompanying Management Discussion and Analysis [PDF file] explains that the operating revenue came from a network of pay-per-use Internet terminals, which Magnate got rid of in 2006. It also notes that the interest income received was worked into a $4,199 reduction of the selling, general and administrative expenses, which explains the diminishment in that item during 3Q '07. Magnate closed on Wednesday at 21 cents/share, down 1.5 cents/share from Tuesday's close. The financials and M D & A were disseminated after the close of trading.