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Contact us: luckyhdcn AT proton.me
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| Contact us: luckyhdcn AT proton.me |
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FOR IMMEDIATE RELEASE - IN ATTENTION TO ALL CREDITORS!
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Insolvency, en Procedure Collective (Nesostoyatelnost) Announcement
Dear Valued Creditors,
We regret to inform you that our company has entered into an insolvency, en procedure collective (Nesostoyatelnost). This decision was not made lightly and comes after exhaustive efforts to sustain our operations amidst challenging financial circumstances.
The purchase of a new platform has been followed by numerous issues, significantly exacerbating our financial difficulties. The technology associated with the new platform was outdated and incompatible with our existing systems, resulting in substantial additional costs for upgrades and integration. Furthermore, the platform's performance has been unreliable, leading to frequent outages and customer dissatisfaction. These technical challenges have also strained our relationship with key partners, many of whom have chosen to terminate their agreements, further impacting our revenue streams.
Our business model relies heavily on advertising revenue generated from ads placed on partner streams. As partners left, the number of streams decreased, reducing ad impressions and revenue. While advertising on streams can provide a steady revenue stream without upfront costs from partners, it also exposes us to market volatility and advertiser demand fluctuations. The decreasing ad rates despite securing better deals have compounded these issues.
The operational disruptions have necessitated increased expenditure on customer support and technical assistance, diverting funds from other critical areas of our business. The negative publicity surrounding these issues has also tarnished our brand reputation, making it harder to attract new customers and retain existing ones. Consequently, our projected revenues have significantly decreased, compounding our already precarious financial situation.
Additionally, we must acknowledge the tragic passing of a previous employee from the acquired organization, in a special operation, as well as another incident that has created further instability. The administration is actively seeking solutions to address these challenges and stabilize operations.
Nonetheless, the management is confident that through the staggered payment of the debtor's debts, with installments set in accordance with the real capacity of the ongoing activities, based on a reorganization plan and the attraction of additional funding from shareholders and/or banking institutions, it is possible to maintain the company's operations and avoid bankruptcy.
We are exploring various strategic alternatives, including potential sales to investors in the advertising sector and other investors in computing equipment. These measures aim to stabilize our financial standing and ensure the continuation of our business operations.
We would also like to note that this situation is also faced by our competitors, some which have been affected worse than us, and other partners which have went out of business. We assure you that we are committed to fulfilling our obligations to all creditors. Every effort will be made to repay the debts owed. However, we must be transparent in acknowledging that while we are optimistic about settling our liabilities, there remains a possibility that not all debts may be fully repaid.
We appreciate your understanding and patience during this difficult time. For any inquiries or further information, please do not hesitate to contact us.
Sincerely,
GDS INTERNET SERVICES & DS ENTERPRISE TELECOM SERVICES
Consortium & international business alliance
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Economic-Financial Analysis
The current financial situation of our company is dire. Below is a detailed list of all assets owned:
| Asset |
Value (USD) |
| Fixed Assets |
3,000 |
| IT Equipment |
5,000 |
| Company Vehicles |
2,000 |
| Furniture and Fixtures |
1,000 |
| Accounts Receivable |
3,000 |
| Inventory |
500 |
| Cash |
2,000 |
| Computing Equipment, Networking, and Others * |
5,000 |
| Total Assets |
21,500 |
* CPUs, GPUs and long term fiber contracts which are paid upfront
Despite owning assets valued at $21,500, our liabilities far exceed this amount. The substantial financial challenges we face have led to this unfortunate situation.
Table of Debts
| Debt Type |
Amount (USD) |
| LTO (Lease-to-Own) Servers |
5,000 |
| Bandwidth* |
20,000 |
| Domains |
1,000 |
| Licensing Fees |
500 |
| Staff Salaries |
2,000 |
| Amount unpaid to operator of the previous enterprise |
4,000 |
| Miscellaneous Expenses |
1,500 |
| Total Debts |
34,000 |
* The debts accrued to bandwidth providers have been made over the course of 2 months in which our main provider was doing maintenance on the systems. This is not representative of normal cost
Risks Associated with IT Systems
The dependency on IT systems for the operations of our platform poses significant risks. Any failure or breach in these systems could result in severe disruptions, data loss, and potential legal liabilities.
Seasonal Sales Risk
Sales may fluctuate significantly due to seasonal variations, impacting our revenue stream. These fluctuations could pose risks to our financial stability, especially during off-peak periods.
Benefit of Regulation of Gambling Advertisements
The regulation of gambling advertisements, which prohibits physical advertisements in large cities, means sports sites like ours receive additional advertising budgets. This presents an opportunity to capture a larger audience, although the advertisement rates are currently bad and getting worse despite this.
Ad Rates and Financial Challenges
Despite securing better deals, the advertisement rates have been deteriorating, further exacerbating our financial challenges. This trend poses a significant risk to our revenue generation capabilities.
Sources of Financing
Our Reorganization Plan is based on:
- Accelerating the collection of receivables accumulated before the insolvency procedure started, as well as during the observation period;
- Resizing and correlating payment terms for debts and receivables that will be generated from the company's current activities;
- Liquidity generated from the continuation of the company's activities during the Reorganization Plan;
- Additional liquidity resources generated from increasing the volume of activity through media products and development perspectives.
Nonetheless, the management is confident that through the staggered payment of the debtor's debts, with installments set in accordance with the real capacity of the ongoing activities, based on a reorganization plan and the attraction of additional funding from shareholders and/or banking institutions, it is possible to maintain the company's operations and avoid bankruptcy.
We are exploring various strategic alternatives, including potential sales to investors in the advertising sector and other investors in computing equipment. These measures aim to stabilize our financial standing and ensure the continuation of our business operations.
Additional Financial Strains
We have recently encountered unforeseen financial strains. An unanticipated increase in the cost of computing equipment used in our operations has further stressed our already fragile financial situation. Additionally, our primary data center experienced a critical hardware failure, necessitating emergency repairs and replacement of key components, which incurred significant unexpected expenses.
Our reorganization plan focuses on stabilizing our current operations and gradually paying off our debts. We are actively seeking additional funding from shareholders and banking institutions to support this plan. Administratio nis dedicated to navigating these turbulent times and steering the company back to financial health.
Recent Positive Developments
We are pleased to share some positive developments that bode well for our future. Recently, we have signed agreements with several prominent Spanish (Latam, not Spain) websites, which are expected to significantly boost our advertising reach and revenue. Additionally, we have diversified our ad networks, with an ad-bid system, made in-house, leading to higher CPM rates that have positively impacted our earnings.
Our server costs, while remaining constant, have become more efficient, allowing us to handle greater traffic without additional expenses. These improvements have bolstered our capacity to serve our customers better and more reliably.
The management is optimistic about these new opportunities and confident that they will contribute to stabilizing our financial position. We remain dedicated to exploring further avenues for growth and enhancing our service offerings to ensure long-term success.
We appreciate your continued support and understanding as we work through these challenges. For any further inquiries or updates, please do not hesitate to contact us.
Sincerely,
GDS INTERNET SERVICES & DS ENTERPRISE TELECOM SERVICES
Consortium & international business alliance
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