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§ ARISE Technologies Corporation
§ Consolidated Balance Sheets
§ Unaudited
§ As at As at
§ March 31, December 31,
§ 2008 2007
§ ------------- -------------
§ Assets
§ Current assets
§ Cash and cash equivalents $ 6,592,757 $ 37,908,430
§ Accounts receivable 145,190 254,025
§ Inventory 27,534,870 855,588
§ Government assistance receivable 10,799,581 6,096,333
§ Other receivables 2,418,444 1,477,584
§ Prepaid expenses 2,862,552 412,270
§ --------------------------------------------------
§ 50,353,394 47,004,230
§ Capital assets, net 23,154,615 14,402,403
§ Long term deposits 12,609,913 5,181,347
§ Other assets, net 53,084 53,086
§ --------------------------------------------------
§ $ 86,171,006 $ 66,641,067
§ --------------------------------------------------
§ --------------------------------------------------
§ Liabilities
§ Current liabilities
§ Bank loans $ 17,474,418 $ 1,087,835
§ Accounts payable and accrued liabilities 14,453,328 8,980,796
§ Deferred revenue 2,320,924 47,263
§ Unearned government assistance 138,551 2,713,078
§ --------------------------------------------------
§ 34,387,221 12,828,972
§ --------------------------------------------------
§ Shareholders' Equity (Deficiency)
§ Capital stock 75,316,634 72,857,557
§ Contributed surplus 5,031,114 4,140,849
§ Deficit (28,563,963) (23,186,311)
§ --------------------------------------------------
§ 51,783,785 53,812,095
§ --------------------------------------------------
§ $ 86,171,006 $ 66,641,067
§ --------------------------------------------------
§ --------------------------------------------------
§ Approved by the board
§ (signed) Bart Tichelman ............. Director
§ (signed) Harold Alexander .......... Director
§ ARISE Technologies Corporation
§ Consolidated Statements of Loss and Comprehensive Loss
§ Unaudited
§ 3 months ended March 31,
§ 2008 2007
§ ------------- -------------
§ Sales $ 175,377 $ 186,801
§ Cost of goods sold 158,195 170,352
§ --------------------------------------------------
§ Gross profit 17,182 16,449
§ --------------------------------------------------
§ Expenses
§ Research and development 1,511,984 443,201
§ General and administrative 3,109,707 819,937
§ Selling and marketing 544,173 63,428
§ Depreciation of capital assets 114,965 866
§ --------------------------------------------------
§ 5,280,829 1,327,432
§ --------------------------------------------------
§ Operating loss (5,263,647) (1,310,983)
§ --------------------------------------------------
§ Other expenses (income)
§ Interest expense (income), net (275,560) 4,718
§ Foreign exchange loss 387,933 -
§ Other expense 1,632 -
§ --------------------------------------------------
§ 114,005 4,718
§ --------------------------------------------------
§ Net loss and comprehensive loss (5,377,652) (1,315,701)
§ --------------------------------------------------
§ Deficit, beginning of year (23,186,311) (11,579,274)
§ --------------------------------------------------
§ Deficit, end of year $(28,563,963) $(12,894,975)
§ --------------------------------------------------
§ --------------------------------------------------
§ Loss per share - basic and diluted $ (0.05) $ (0.04)
§ --------------------------------------------------
§ --------------------------------------------------
§ ARISE Technologies Corporation
§ Consolidated Statements of Cash Flows
§ Unaudited
§ 3 months ended March 31,
§ 2008 2007
§ ------------- -------------
§ Cash flows from operating activities
§ Net loss for the year $ (5,377,652) $ (1,315,701)
§ Items which do not involve cash:
§ Depreciation of capital assets 110,769 866
§ Amortization of other assets 4,224 1,788
§ Issuance of capital stock for services - 214,488
§ Employee stock-based compensation 1,395,745 166,073
§ Non-employee stock-based compensation 99,879 -
§ --------------------------------------------------
§ (3,767,035) (932,486)
§ Decrease (increase) in:
§ Accounts receivable 108,835 27,197
§ Inventory (26,679,283) 18,121
§ Other receivables (901,047) -
§ Prepaid expenses (2,490,094) (84,531)
§ Accounts payable and accrued liabilities 5,472,534 (212,326)
§ Deferred revenue 2,273,660 (11,830)
§ --------------------------------------------------
§ (25,982,430) (1,195,855)
§ --------------------------------------------------
§ Cash flows from financing activities
§ Issuance of capital stock for cash - 1,392,550
§ Exercise of warrants and options 1,853,717 473,509
§ Share subscription receivable - 1,878,600
§ Proceeds from bank loans 16,386,582 -
§ --------------------------------------------------
§ 18,240,299 3,744,659
§ --------------------------------------------------
§ Cash flows from investing activities
§ Purchase of capital assets (15,223,110) (316,101)
§ Change in other assets (4,222) (5,922)
§ Change in long term deposits (7,428,566) -
§ Government assistance (917,644) -
§ --------------------------------------------------
§ (23,573,542) (322,023)
§ --------------------------------------------------
§ Net cash flow (31,315,673) 2,226,781
§ Cash and cash equivalents, beginning of year 37,908,430 198,222
§ --------------------------------------------------
§ Cash and cash equivalents, end of year $ 6,592,757 $ 2,425,003
§ --------------------------------------------------
§ --------------------------------------------------
§ Supplemental disclosures of cash flows:
§ Interest paid $ 48,232 $ 4,718
§ --------------------------------------------------
§ Income taxes paid $ - $ -
§ --------------------------------------------------
§ --------------------------------------------------
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