Kent Financial Services Inc. has a market cap of $4.1 million; its shares were traded at around $1.5001 with and P/S ratio of 90.
Highlight of Business Operations:Additionally, Kent International s wholly owned subsidiary, Kent Capital, Inc. (“Kent Capital”), is a securities broker-dealer. Kent Capital s membership agreement with the Financial Industry Regulatory Authority (FINRA) allows it to operate under three business lines; Private Placements, Real Estate Syndication and Trading Securities for Our Own Account. The Company intends to operate the broker dealer in an attempt to generate revenue and earnings. However, management will continue to pursue merger or acquisition opportunities that offer potentially profitable uses for the Company s available capital as discussed above. The Company s initial investment in Kent Capital was $350,000, with the potential to increase the investment to $2,500,000 or more within the next year, depending on the prospects for potential return on the investment.
The Company had a net loss of $155,747 or $.06 basic and diluted loss per share, for the three months ended March 31, 2010 compared to a net loss of $106,728, or $.04 basic and diluted loss per share for the comparable quarter in 2009. The increase in the net loss was primarily the result of a decrease in the income from discontinued operations. .
Interest and dividend revenue decreased to $859 for the three months ended March 31, 2010, from $7,557 for the three months ended March 31, 2009. A decrease in the yield on short-term investments and cash equivalents from 0.2% to 0.05% was the primary reason for the decreases.
For the three months ended March 31, 2010, other income increased to $4,875 from $2,409 for the three months ended March 31, 2009, caused primarily by the increase in administrative fees paid by an un-affiliated investment partnership. These administrative fees fluctuate based on the performance of the investment partnership and; therefore, are unpredictable
General and administrative expenses were $204,611 in the three months ended March 31, 2010 compared to $213,418 in the three months ended March 31, 2009, a decrease of $8,807. This decrease was primarily caused by activity in subsidiaries of Kent International. Specifically a decrease in marketing expenses related to ChinaUSPals.com of $6,877 and a decrease in consulting fees related to Kent Capital of $6,000. These decreases were partially offset by an increase in auditing expenses related to the audit of Kent Capital in the amount of $5,000. There were also other immaterial increases and decreases in administrative expenses at both the Company and Kent International.
At March 31, 2010, the Company had cash and cash equivalents of $10,951,543. Cash and cash equivalents consist of cash held in banks and brokerage firms and U.S. Treasury Bills with original maturities of three months. Working capital at March 31, 2010 was approximately $10.840 million. Management believes its cash and cash equivalents are sufficient for its business activities for at least the next 12 months and for the costs of starting of seeking an acquisition or an operating business.
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