August 31, 2021:
The results of our August quarter reflect the continuation of the success being
experienced in the incubation of our premier start-up subsidiary in the
Transportation Services segment of the Trucking Industry. Daniels continued to
umbrella its Subsidiary, Payless Truckers’, Inc. expansion through financing
sources expensive in nature. Parent Company Management believes the capital
costs incurred were warranted and helped produce another stellar quarter for its
key growth engine. After months of negotiations, a number of financing options
are in final review with some having very favorable terms including long term
For the nine months – December 1, 2020 through August 31, 2021 – Total Revenue
was $3,544,792 compared to $2,570,250 for the previous fiscal year. This was
comprised of $2,885,121 from the Flip business and $659,671 in fleet rental and
repairs income. While both businesses continue to produce high margins, our
program rental fleet has the potential to be scale-able and provide significant
growth because of its predictable gross cash flow / potential earnings stream.
The financing alternatives being discussed are primarily for that purpose.
During the August quarter, in-house financing potential of aged management award
shares – while available and already counted in the outstanding shares total –
continued to be held in check in favor of continuing negotiations with financing
options which continue to multiply because of proved operating results. The
grants were created for a specific purpose – for Senior oversight financial
management. operations managers and retained consultants – to participate
individually and voluntarily in the in-house control and timing of funding as
needed. The eventual use of the award shares could provide selective management
of the growth of Payless.
Negotiations with long term straight debt lenders and Preferred Stock financiers
continued through the August quarter. More creative approaches were developed
and options continue to be studied. The main objective – which continued to take
more time than expected – is to create alternatives that (a) that are repaid out
of cash flows and/or (b) with equity participation that is accretive. Daniels’
senior management believes levered financing – supported by the equity and
layered finance options mentioned – will allow Payless to achieve the first
plateau of 100 rental fleet trucks in a measured amount of time. We are
seriously considering the acquisition of a larger operating facility so we can
accelerate the build out of Payless. Current capital negotiations now include a
real estate component so we can accelerate our fleet expansion. Our current
operating facility has limited monthly capacity and can only add five to six
truck additions to our rental fleet.
The funding options being discussed will eliminate the need for the continuation
of expensive private investor funding. Blended Public market-rates for
financing, will allow Daniels / Payless to service a larger debt load and
accelerate growth prospects. Our cost of capital should drop significantly from
As used in this interim report, the terms “we”, “us”, “our”, the “Company”, the
“Registrant”, “Daniels Corporate Advisory”, “DCAC” and “Daniels” mean Daniels
Corporate Advisory Company, Inc. unless otherwise indicated.
Daniels Corporate Advisory creates and implements corporate strategy
alternatives for the mini-cap public or private company client. The addition of
new business opportunities and the location of professional talent for
implementation is anticipated through the full-time efforts of our senior
management. These efforts are to be expanded in the United States and in foreign
capitals by an expanding advisory board and through the networks of independent
consultants. Principals of the respective client company will open their
networks to augment professional access for specialties the Daniels corporate
strategy consultants believe are needed in a joint-venture, jointly-controlled
undertaking created for the client’s optimum growth.
Daniels may provide the client with multiple corporate strategies/opportunities
including joint-ventures, marketing opportunity agreements and/or potential
acquisitions structured in leveraged buyout format. One or a combination of
these strategies would allow the client to enter new market niches or expand
further into existing ones.
Recent Business Developments
The Company is operating through the corporate strategy segment of its business.
It is attempting to build its own critical mass by creation of start-up
subsidiaries it believes have promise/potential. The stated goal is for the
parent (DCAC) company to consolidate the critical mass of the
subsidiary/start-ups with that of the parent for eventually listing on a major
stock exchange. We have continued to focus our efforts on the build out of the
Daniels corporate strategy model. We adjusted our strategy as it relates to the
development of subsidiary start-ups and potential acquisitions for common stock.
We concentrate on identifying projects that have the potential to produce
significant earnings on the leveraged capital base of both the parent and the
subsidiary/start-up within an expedited time period.
As a result, we formed Payless Truckers, Inc. (“Payless”), a wholly-owned
subsidiary which was incorporated in the State of Nevada, on April 11, 2018.
Payless is a start-up, service company in the trucking industry. It has two
business segments with its launch and current results coming from the “flip”
segment, whose principal business is to acquire class 8 heavy duty trucks,
refurbish them, add location electronics, advertise and sell to independent
drivers and operators. The second segment is the “credit rebuilding segment”
where class 8 heavy duty trucks, owned by Daniels/Payless, are rented to
experienced independent drivers. These independent drivers rent for a period of
up to five years, and have the option to buy the vehicle at retail value every
six months. This segment commenced operations subsequent to the close of our
fiscal year. In an effort to grow quickly and profitably, Daniels entered into
an operating agreement with a senior operating management team in an effort to
drive the business and better realize its earnings and growth potential.
The Payless two-segment trucking model represents a streamlined Transportation
Services Company; one Daniels believes can be restructured/redirected to survive
any potential future slow-downs in the economy. The model was developed to allow
for the maximum utilization of each truck as it is put into immediate service in
numbers that are manageable without causing excess capacity. Top brand/model
Tractors with low mileage are handpicked by our operations team – a family with
three generations in automotive/trucking. Our drivers continue to be handpicked
for their driving skills and their established hauling networks. They
rent/switch trailers to meet the available work on Load Boards or haul for major
hauling companies using hauling company trailers. Due to the current
dislocations in every industry due to the Coronavirus, our independent
contractor drivers are constantly on the road.
We hope to further enhance our plan for growth beginning in our second year by
forming joint-ventures and/or partnerships with truck maintenance companies
across the United States in key traffic hubs. This will potentially afford
independent drivers and operators the opportunity to be serviced by trusted
maintenance facilities under our warranty program.
Business Strategy – Current Operational Strategy & Current Client Projects
Daniels creates and implements corporate strategy alternatives for the mini-cap
public or private company client. The addition of new business opportunities and
the location of professional talent for implementation is anticipated through
the full-time efforts of our senior management. These efforts are to be expanded
in the US and in Foreign capitals by an expanding advisory board and through the
networks of independent consultants. Principals of the respective client company
will open their networks to augment professional access for specialties the
Daniels corporate strategy consultants believe are needed in a joint venture,
(jointly-controlled) undertaking created for the client’s optimum growth.
Daniels may provide the client with…