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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2011

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                            to                            

Commission File Number: 333-168346
 

TBSS INTERNATIONAL, INC.
(formerly Avenue South Ltd.)
(Exact name of registrant as specified in its charter)

Nevada 26-0478989
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)  

9113 Ridge Road, Suite 50  
New Port Richey, Florida 34654
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number (including area code): (855) 645-4653

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes [X]         No [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [  ] Accelerated filer [  ]
Non-accelerated filer [  ] Smaller reporting company [X]
(Do not check if a smaller reporting company)  

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes [  ]             No [X]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Date File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). [  ]

As of November 18, 2011, there were 150,460,000 shares of company common stock issued and outstanding.


TBSS INTERNATIONAL, INC.
(FORMERLY AVENUE SOUTH LTD.)

Quarterly Report on Form 10-Q

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION  
Cautionary Note Regarding Forward-Looking Statements
Item 1. Financial Statements (unaudited)
Condensed Consolidated Balance Sheets as of September 30, 2011 (unaudited) and March 31, 2011 3
Condensed Consolidated Statements of Operations (unaudited) for three and six months ended September 30, 2011 and 2010, and for the period since inception July 6, 2007 to September 30, 2011 4
Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit) (unaudited) for the period since inception to September 30, 2011 5
Condensed Consolidated Statements of Cash Flows (unaudited) for six months ended September 30, 2011 and 2010 and for the period since inception July 6, 2007 to September 30, 2011 6
  Notes to Condensed Consolidated Financial Statements (unaudited) 7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 11
Item 3. Quantitative and Qualitative Disclosures about Market Risk 15
Item 4. Controls and Procedures 15
PART II – OTHER INFORMATION  
Item 1. Legal Proceedings 15
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 16
Item 3. Defaults Upon Senior Securities 16
Item 4. Removed and Reserved 16
Item 5. Other Information 16
Item 6. Exhibits 16
SIGNATURES 17


PART I - FINANCIAL INFORMATION

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

In addition to historical information, this Quarterly Report on Form 10-Q contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected in such forward-looking statements. We cannot give any guarantee that the plans, intentions or expectations described in the forward looking statements will be achieved. All forward-looking statements involve significant risks and uncertainties, and actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including those factors described in the “Risk Factors” section of our annual report on Form 10K that was filed with the Securities & Exchange Commission on June 14, 2011. Readers should carefully review such risk factors as well as factors described in other documents that we file from time to time with the Securities and Exchange Commission.

In some cases, you can identify forward-looking statements by terminology such as “guidance,” “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “potential,” “proposed,” “intended,” or “continue” or the negative of these terms or other comparable terminology. You should read statements that contain these words carefully, because they discuss our expectations about our future operating results or our future financial condition or state other “forward-looking” information. There may be events in the future that we are not able to accurately predict or control. You should be aware that the occurrence of any of the events described in our risk factors and other disclosures could substantially harm our business, results of operations and financial condition, and that upon the occurrence of any of these events, the trading price of our securities could decline. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, growth rates, and levels of activity, performance or achievements. Factors that may cause actual results, our performance or achievements, or industry results, to differ materially from those contemplated by such forward-looking statements include, without limitation:

  • our ability to obtain sufficient working capital to support our business plans;

  • our ability to expand our product offerings;

Readers are cautioned not to place undue reliance on our forward-looking statements, which reflect management’s opinions only as of the date thereof. We undertake no obligation to revise or publicly release the results of any revision of our forward-looking statements, except as required by law.

2


Item 1.     Financial Statements

TBSS INTERNATIONAL, INC.
(Formerly Avenue South Ltd.)
(A Development Stage Company)

CONDENSED CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2011
(UNAUDITED) AND MARCH 31, 2011

    September 30,     March 31,  
    2011     2011  

 

  Unaudited        

ASSETS

           

Current Assets:

           

   Cash

$  —   $  115,137  

 

           

   Total Assets

      115,137  

 

           

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

           

 

           

Current Liabilities

           

   Accrued liabilities

  18,594     5,165  

   Due to related parties

      72,210  

 

           

           Total Liabilities

  18,594     77,375  

 

           

 

           

Stockholders’ Equity (Deficit):

           

   Preferred stock, $0.001 par value; 25,000,000 shares authorized; 0 shares issued and outstanding at September 30, 2011 and March 31, 2011

       

   Common stock, $0.001 par value; 500,000,000 shares authorized; 121,800,000 shares issued and outstanding at September 30, 2011 and March 31, 2011, respectively

  121,800     121,800  

   Additional paid-in capital

       

   Deficit accumulated during the development stage

  (140,394 )   (84,038 )

 

           

Total Stockholders’ Equity (Deficit)

  (18,594 )   37,762  

 

           

Total Liabilities and Stockholders’ Equity (Deficit)

$  —   $  115,137  

See accompanying notes to unaudited consolidated financial statements

3


TBSS INTERNATIONAL, INC.
(Formerly Avenue South Ltd.)
(A Development Stage Company)

CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED) FOR THE THREE AND SIX MONTHS ENDED SEPTEMBER 30, 2011 AND 2010, AND
FOR THE PERIOD SINCE INCEPTION JULY 6, 2011 TO SEPTEMBER 30, 2011

                            Successor     Predecessor  
                            For the     For the  
                    period from     period from  
                            July 6,     February 15,  
    Successor     Successor     Successor     Successor     2007     2005  
    For the six     For the six     For the three     For the three     (Date of     (Date of  
    months ended     months ended     months ended     months ended     Inception) to     Inception) to  
    September 30,     September 30,     September 30,     September 30,     September 30,     July 5,  
    2011     2010     2011     2010     2011     2007  

Revenue

                                   

Sales

$  18,033   $  62,465   $  -   $  42,455   $  163,022   $  10,787  

Cost of Sales

  15,112     53,749     -     36,801     136,750     8,675  

Gross Profit (Loss)

  2,921     8,716     -     5,654     26,272     2,112  

Operating expenses

                                   

Other selling, general and administrative expenses

  59,277     10,406     45,815     10,291     98,866     40,024  

 

                                   

Total operating expenses

  59,277     10,406     45,815     10,291     98,866     40,024  

 

                                   

Net operating loss

  (56,356 )   (1,690 )   (45,815 )   (4,637 )   (72,594 )   (37,912 )

 

                                   

Net loss

$  (56,356 ) $  (1,690 ) $  (45,815 ) $  (4,637 )            

Loss per common share:

                                   

 

                                   

 - Basic and fully diluted -

$  -   $  -   $  -   $  -              

Weighted average number of shares

                       

 - Basic and fully diluted

  121,800,000     96,840,976     121,800,000     121,800,000              

See accompanying notes to unaudited consolidated financial statements

4


TBSS INTERNATIONAL, INC.
(Formerly Avenue South, Ltd)
(A Development Stage Company)

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDER’S EQUITY (DEFICIT)
(UNAUDITED) FOR THE PERIOD SINCE INCEPTION JULY 6, 2007 TO SEPTEMBER 30, 2011

                                  Deficit              
                                  Accumulated              
                            Additional     During the     Stock     Total  

 

  Common Stock     Capital Stock      Subscribed     Paid     Development     Subscription     Stockholders’  

Predecessor Entity

  Shares     Amount     Shares     Amount     In capital     Stage     Receivable     Equity  

Balance, February 15, 2005

                                               

(Inception of Predecessor Entity)

    $  —       $  —   $  —   $  —   $  —   $  —  

Share issued in inception

  1     100                         100  

Net loss for the period

                      (2,167 )       (2,167 )

Balance, March 31, 2005

  1     100                 (2,167 )       (2,067 )

 

                                               

Net loss for the year

                      (15,439 )       (15,439 )

Balance, March 31, 2006

  1     100                 (17,606 )       (17,506 )

 

                                               

Net loss for the year

                      (275 )       (275 )

Balance, March 31, 2007

  1     100                 (17,881 )       (17,781 )

 

                                               

Net loss for the year

                      (20,031 )       (20,031 )

Balance, July 5, 2007

  1   $  100       $  —   $  —     (37,912 ) $  —     (37,812 )

 

                                               

Successor Entity

                                               

Balance, July 6, 2007

                                               

(Inception of Successor Entity)

    $  —       $  —   $  —   $  —   $  —   $  —  

Issuance of Common Stock

  58,000,000     58,000                 (48,000 )       10,000  

Net loss for the period

                      (1,225 )       (1,225 )

Balance, March 31, 2008

  58,000,000     58,000                 (49,225 )       8,775  

 

                                               

Share issued in private placement at $0.002 per share

  13,050,000     13,050                 (4,050 )       9,000  

Net loss for the year

                      (7,773 )       (7,773 )

Balance, March 31, 2009

  71,050,000     71,050                 (61,048 )       10,002  
                                                 

Common stock subscribed in private placement at $0.002 per share

          50,750,000     35,000                 35,000  

Shares subscription receivable

                          (35,000 )   (35,000 )

Net income for the year

                      1,208         1,208  

Balance, March 31, 2010

  71,050,000   $  71,050     50,750,000   $  35,000   $  —   $  (59,840 ) $  (35,000 ) $  11,210  

 

                                               

Cash collected – stock subscriptions issued

                                               

Common stock subscribed in private placement at $0.002 per share

  50,750,000     50,750     (50,750,000 )   (35,000 )       (15,750 )   35,000     35,000  

Net loss for the year

                      (8,448 )       (8,448 )

Balance, March 31, 2011

  121,800,000   $ 121,800       $  —   $  —   $  (84,038 ) $  —   $  37,762  

 

                                               

Net loss for the period

                      (56,356 )       (56,356 )

Balance, September 30, 2011

  121,800,000   $ 121,800       $  —   $   $  (140,394 ) $  —   $  (18,594 )


See accompanying notes to unaudited consolidated financial statements

5


TBSS INTERNATIONAL, INC. (FORMERLY AVENUE SOUTH LTD.)
(A Development Stage Company)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED) FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2011 AND 2010 AND FOR THE
PERIOD SINCE INCEPTION JULY 6, 2007 TO SEPTEMBER 30, 2011

            Successor     Predecessor  
                For the period     For the period from  
    Successor     Successor     July 6, 2007     February 15, 2005  

 

  For the six     For the six     (Date of     (Date  

 

  months ended     months ended     Inception) to     of Inception) to  

 

  September 30,     September 30,     September 30,     July 5,  

 

  2011     2010     2011     2007  

Cash flows from operating activities

                       

Net loss for the period

$  (56,356 ) $ (1,690 ) $  (72,594 ) $  (37,912 )

         Amortization

              6,735  

 

                       

Changes in operating assets and liabilities:

                       

         Other current assets and current liabilities

  13,429     3,000     18,594     (74 )

         Inventories

          (10,000 )   (10,500 )

Net cash (used in) provided by operating activities

  (42,927 )   1,310     (64,000 )   (41,751 )

 

                       

Cash flows from investing activities

                       

         Acquisition of web site

              (33,000 )

 

                       

Net cash flows used in investing activities

              (33,000 )

 

                       

Cash flows from financing activities

                       

         (Repayment to)/Advance from related parties

  (72,210 )   (35,000 )   10,000     76,882  

         Proceeds from issuance of common stock

      35,000     54,000     100  

Net cash flows (used in) provided by financing activities

  (72,210 )       64,000     76,982  

Net (decrease) increase in cash

  (115,137 )   1,310         2,231  

 

                       

 

                       

Cash- beginning of period

  115,137     123,420          

Cash- end of period

$  —   $ 124,730   $  —   $  2,231  

 

                       

Supplemental disclosure of non cash financing activities:

               

   Issuance of common stock subscribed

$  —   $  35,000   $  35,000   $  —  

 

                       

Supplemental cash flow Information:

                       

   Cash paid for interest

               

   Cash paid for income taxes

               

See accompanying notes to unaudited consolidated financial statements

6


TBSS INTERNATIONAL, INC.
(Formerly Avenue South Ltd.)
(A Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
UNAUDITED

1. BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements of the TBSS International, Inc. (Formerly Avenue South Ltd.) have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission, or the SEC, including the instructions to Form 10-Q and Regulation S-X. Certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of America have been condensed or omitted from these statements pursuant to such rules and regulations and, accordingly, they do not include all the information and notes necessary for comprehensive consolidated financial statements and should be read in conjunction with our audited consolidated financial statements for the year ended March 31, 2011.

In the opinion of the management of the Company, all adjustments, which are of a normal recurring nature, necessary for a fair statement of the results for the three-month period have been made. Results for the interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year. When used in these notes, the terms "Company", "we", "us" or "our" mean TBSS International, Inc. (Formerly Avenue South Ltd. and its subsidiary) included in these consolidated financial statements.

2. ORGANIZATION AND NATURE OF BUSINESS

On July 6, 2007, our then principal stockholder acquired 100% of the equity of Avenue South, Inc., a North Carolina corporation. On July 6, 2007, Avenue South Ltd., a Nevada corporation was formed by our then principal stockholder and our then principal stockholder entered into a share exchange agreement, pursuant to which all the common stock held by our principal stockholder in Avenue South, Inc. was acquired by Avenue South Ltd. by issuing 2 million common shares to our then principal stockholder. On September 27, 2011, the Company filed a Certificate of Amendment to the Articles of Incorporation with the Nevada Secretary of State. The Articles had the effect of changing the Company’s name from Avenue South Ltd. to TBSS International, Inc. An 8-K was filed on October 14, 2011.

Going Concern

The Company’s success will depend on its ability to pursue clients and sign lucrative contracts and perform under those contracts. There can be no assurance that the company will secure these contracts. The Company does not currently have sufficient cash and financing commitments to meet its funding requirements over the next year. The Company may expect to seek to obtain additional funding through debt or equity transactions. There can be no assurance as to the availability or terms upon which such financing and capital might be available.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of the TBSS International, Inc. (Formerly Avenue South Ltd.) and its wholly-owned subsidiary Avenue South, Inc., after elimination of all material intercompany accounts, transactions, and profits.

A summary of significant accounting policies of TBSS International, Inc. (Formerly Avenue South Ltd.) (A Development Stage Company) (the “Company” or “Successor”) is presented to assist in understanding the Company’s financial statements. The accounting policies presented in these footnotes conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the accompanying financial statements. The Company has not realized any significant revenues from its planned principal business purpose and is considered to be in a development stage in accordance with ASC 915.

7


TBSS International Inc.
(Formerly Avenue South Ltd.)
(A Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
UNAUDITED

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Inventory

Inventories consist of finished goods of home furnishing products. Cost is stated at the lower of cost or market on a first-in, first-out (FIFO) basis. The Company has not recorded an allowance for slow-moving or obsolete inventory. There was no inventory on hand at September 30, 2011.

Income Taxes

The Company uses the liability approach to financial accounting and reporting for income taxes. The differences between the financial statement and tax basis of assets and liabilities are determined annually. Deferred income tax assets and liabilities are computed for those differences that have future tax consequences using the currently enacted tax laws and rates that apply to the period in which they are expected to affect taxable income. Valuation allowances are established, if necessary, to reduce deferred tax asset accounts to the amounts that will more likely than not be realized. Income tax expense is the current tax payable or refundable for the period, plus or minus the net change in the deferred tax asset and liability accounts.

Revenue Recognition

The Company recognizes revenue in accordance with ASC 605, which specifies that revenue is realized or realizable and earned when four criteria are met:

  • Persuasive evidence of an arrangement exists;

  • Delivery has occurred or services have been rendered;

  • The seller’s price to the buyer is fixed or determinable; and

  • Collectability of payment is reasonably assured.

The Company recognizes revenue when the goods are accepted by the customer and title has passed or when the service is performed.

The Company did not provide for an allowance for return products since the Company has not experienced any sales returns.

Certain customer arrangements require evaluation of the criteria outlined in the accounting standards of reporting revenue “Gross” as a Principal Versus “Net” as an Agent in determining whether it is appropriate to record the gross amount of revenue and related costs or the net amount earned as agent fees. Generally, when we are primarily obligated in a transaction, revenue is recorded on a gross basis. Other factors that we consider in determining whether to recognize revenue on a gross versus net basis include our assumption of credit risk, our latitude in establishing prices, our determination of service specifications and our involvement in the provision of services. When we conclude that we are not primarily obligated as a principal, we record the net amount earned as agent fees within net sales.

Basic Income/Loss Per Common Share

The computation of income / loss per share is based on the weighted average number of shares outstanding during the period presented in accordance with ASC 260. At September 30, 2011 and March 31, 2011, the Company did not have any stock equivalents.

8


TBSS International, Inc.
(Formerly Avenue South Ltd.)
(A Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
UNAUDITED

Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates.

Foreign Currency Transactions

For the three months ended September 30, 2011 and 2010, there are no gain and loss on foreign currency transaction as all transactions are denominated in US dollars.

Cash and cash equivalents

The Company considers all cash on hand and in banks, certificates of deposit and other highly-liquid investments with original maturities of three months or less, when purchased, to be cash and cash equivalents.

4. RECENT CHANGES IN ACCOUNTING STANDARDS

Recent Accounting Pronouncements

The Company does not expect that adoption of recently issued accounting pronouncements will have a material impact on its financial position, results of operations or cash flows.

5. DUE TO RELATED PARTIES

As of September 30, 2011, there were no amounts due to related parties. As of March 31, 2011, the amount due to related parties of $72,210 included $72,210 due to the President, Principal Accounting Officer, Secretary and Director. The amounts due are unsecured, non-interest bearing, and due on demand.

6. INCOME TAXES

The Company adopted the provisions of ASC 740, at inception. As a result of the implementation of ASC 740, the Company recognized no increase in the liability for unrecognized tax benefits. The Company has no uncertain tax positions at September 30, 2011 and 2010 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility

At September 30, 2011, the Company had accumulated deficit during the development stage of $72,594 to offset future taxable income. The Company has established a valuation allowance equal to the full amount of this deferred tax asset due to the uncertainty of the utilization of the operating losses in future periods.

9


TBSS International, Inc
(Formerly Avenue South Ltd)
(A Development Stage Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
UNAUDITED

7. STOCKHOLDER’S’ EQUITY (DEFICIT)

The Company’s Articles of Incorporation authorize 500,000,000 shares of $0.001 par value common stock. On December 17, 2008, the Company issued 13,050,000 shares of its Common Stock to the Company’s sole stockholder for total proceeds of $9,000.

On March 28, 2010 the Company had received stock subscriptions to issue 50,750,000 shares of its common stock to 28 non-US investors at $0.001 per share. The Company completed the private placement offering for gross proceeds of $35,000 to non-US persons in reliance of Regulation S promulgated under the Securities Act of 1933 in June 2010. The total amount of common stock subscribed at March 31, 2010 was $35,000.

On June 16, 2010 the Company collected all stock subscriptions receivable totaling $35,000 and issued the 50,750,000 shares that were subscribed in the offering.

Effective the close of business on September 2, 2011, we effected a 29:1 forward stock split in the form of which shareholders of record at the close of business on September 2, 2011 receive an additional 29 shares of our common stock for each share of common stock held by them. All references in this report to our issued and outstanding common stock give retroactive effect to the forward stock split and as such has resulted in negative Additional Paid in Capital. Additional Paid in Capital has been reduced to zero with the effect recorded in Deficit Accumulated During the Development Stage. As the result of the stock split, the total number of the Company’s issued and outstanding shares were increased from 4,200,000 shares to 121,800,000 shares.

8. SUBSEQUENT EVENTS

On October 12, 2011 the Board of Directors decided to exit the web-based retail business of selling home décor and will focus its efforts as an international service company to assist companies that have begun gold mining, drilling, as well as work on water well drilling, trenching and construction. The company believes the costs associated with the discontinuance will be nominal. On October 14, 2011 the SIC code was changed to 1600 – Heavy Construction and Building Constructions.

On October 13, 2011 the Company issued 100,000,000 shares of its $.001 par value Common Stock in exchange for services that have been and will be provided by consultants of the Company. Also on October 13, 2011, the Company’s former President, Secretary, Principal Accounting Officer & Director cancelled 71,050,000 shares of common stock as adjusted for the Company’s 29 to 1 forward stock split that became effective on September 2, 2011. Majority control is not in the hands of any one person.

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Item 2.     Management’s Discussion and Analysis of Financial Conditions of Operations.

The following discussion and analysis of financial condition and results of operations relates to the operations and financial condition reported in our unaudited condensed consolidated financial statements for the three months ended September 30, 2011 and 2010 and should be read in conjunction with such financial statements and related notes included in this report. Those statements in the following discussion that are not historical in nature should be considered to be forward looking statements that are inherently uncertain. Actual results and the timing of the events may differ materially from those contained in these forward looking statements due to a number of factors, including those discussed in the “Cautionary Note on Forward Looking Statements” set forth elsewhere in this Report.

Overview

We are a visionary development firm with a management team representing over 50 years of collective experience in winning competitive contracts on the strength of incorporating proprietary technologies from a network of venture partners. Prior to going public, our management team has won key construction and service contracts in the following industries:

Construction

Oil Drilling

Gold Mining

Water Well Drilling

Sonic and Horizontal Drilling

We have experience and expertise working with a number of Fortune 500 companies requiring an emphasis on environmentally sound practices, in addition to smaller companies operating domestically and internationally.

Principal Factors Affecting our Financial Performance

Our operating results are primarily affected by the following factors:

  •  
  • Our auditors have issued a going concern opinion. This means that there is substantial doubt that we can continue as an ongoing business for the next 12 months.

         
  •  
  • Our ability to achieve and maintain profitability and positive cash flow is dependent upon:

         
  •  
  • our ability to sign lucrative contracts and perform under those contracts;

         
  •  
  • our ability to expand our intellectual property portfolio and take advantage of new technologies presented to us;

         
  •  
  • our ability to maintain sizeable credit lines and buying power from our supplies, which gives us an edge over the competition;

         
  •  
  • our ability to identify and pursue mediums through which we will be able to market our services;

         
  •  
  • our ability to attract new customers to our website who are interested in our services;

         
  •  
  • our ability to manage our costs and maintain low overhead.

         
  •  
  • Based upon current plans, we expect to incur operating losses in future periods because we will continue to be in the development stage and will be incurring expenses and not generating significant revenues.

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    Results of Operations for the three months ended September 30, 2011 and September 30, 2010 (successor).

    Revenues

    We generated no revenues during the three months ended September 30, 2011 and $42,455 during the same period in 2010. This decrease in revenue is due to our decision to exit the web-based retail business of selling home décor. We intend to focus our efforts as an international service company to assist companies that are in the business of gold mining and water well drilling.

    Cost of Sales

    Our cost of sales was $0 for the three months ended September 30, 2011 compared to $36,801 for the three months ended September 30, 2010. The decrease in the cost of sales for the three months ended September 30, 2011 was due to our decrease in revenue for the three months ended September 30, 2011.

    Gross Profit

    Our gross profit (loss) was $0 for the three months ended September 30, 2011 compared to $5,654 for the three months ended September 30, 2010. The decrease in the gross profit for the three months ended September 30, 2011 was due to our decrease in revenue for the three months ended September 30, 2011. We expect our future gross profit margins to be in the range of 13% to 20% as we seek new business and customers in the area of assisting companies with gold mining, drilling, trenching and construction.

    Expenses

    Our expenses were $45,815 for the three months ended September 30, 2011 compared to $10,291 for the three months ended September 30, 2010. The increase in the expenses for the three months ended September 30, 2011 was due to our increased costs incurred for professional fees related to making changes to our business plan, Articles of Incorporation and other costs associated with being a public company. We expect our general and administrative costs to increase later in 2011 as we begin operating under the new business plan and name TBSS International. We may also increase our general and administrative expenses if we are able to raise money through a combination of debt financing and equity financing by way of doing another private placement.

    Net Loss

    We had net loss of $45,815 during the three months ended September 30, 2011 and a net loss of $4,637 during the same period in 2010. This increase in net loss for the three months ended September 30, 2011 is due to an increase in other general and administrative expenses for the three months ended September 30, 2011 and decline in revenue due to our decision to exit the web-based retail industry.

    Results of Operations for the six months ended September 30, 2011 and September 30, 2010 (successor).

    Revenues

    We generated revenues of $18,033 during the six months ended September 30, 2011 and $62,465 during the same period in 2010. This decrease in revenue is due to our decision to exit the web-based retail business of selling home décor. We intend to focus our efforts as an international service company to assist companies that are in the business of gold mining and water well drilling.

    Cost of Sales

    Our cost of sales was $15,112 for the six months ended September 30, 2011 compared to $53,749 for the six months ended September 30, 2010. The decrease in the cost of sales for the six months ended September 30, 2011 was due to our decrease in revenue for the six months ended September 30, 2011.

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    Gross Profit

    Our gross profit was $2,921 for the six months ended September 30, 2011 compared to $8,716 for the six months ended September 30, 2010. The decrease in the gross profit for the six months ended September 30, 2011 was due to our decrease in revenue for the six months ended September 30, 2011. We expect our future gross profit margins to be in the range of 13% to 20% as we seek new business and customers in the area of assisting companies with gold mining, drilling, trenching and construction.

    Expenses

    Our expenses were $59,277 for the six months ended September 30, 2011 compared to $10,406 for the six months ended September 30, 2010. The increase in the expenses for the six months ended September 30, 2011 was due to our increase costs incurred for professional fees related to making changes to our business plan, Articles of Incorporation and other costs associated with being a public company. We expect our general and administrative costs to increase later in 2011 as we begin operating under the new business plan and name TBSS International. We may also increase our general and administrative expenses if we are able to raise money through a combination of debt financing and equity financing by way of doing another private placement.

    Net Loss

    We had net loss of $56,356 during the six months ended September 30, 2011 and a net loss of $1,690 during the same period in 2010. This increase in net loss for the six months ended September 30, 2011 is due to an increase in other general and administrative expenses for the six months ended September 30, 2011 and decline in revenue due to our decision to exit the web-based retail industry.

    Results of Operations from July 6, 2007 (successor inception) to September 30, 2011.

    Revenues

    We generated revenues of $163,022 during the period from our inception on July 6, 2007 to September 30, 2011.

    This revenue is primarily due to our sales to our major customer, a Hong Kong based wholesale distributor of home furnishings. Our inability to generate significant revenues was a leading force in our decision to exit the web-based retail industry and focus our efforts on heavy construction and other building construction. We will continue to be a development stage company.

    Cost of Sales

    Our cost of sales from our inception on July 6, 2007 to September 30, 2011 was $136,750. The cost of sales was due to our revenue from our merchandise sales to our major customer.

    Gross Profit

    Our gross profit from our inception on July 6, 2007 to September 30, 2011 was $26,272. Substantially all of our gross profit is generated from our major customer.

    Expenses

    From our inception on July 6, 2007 to September 30, 2011, our total expenses were $98,866. These total expenses since inception to September 30, 2011 were for general and administrative expenses which consisted of professional fees, credit card fees and other general and administrative expenses.

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    Net Loss

    We have a net loss of $72,594 during the period from our inception on July 6, 2007 to September 30, 2011. Our net loss is due to the reasons described above.

    Liquidity and Capital Resources as of September 30, 2011 and March 31, 2011

    As of September 30, 2011, we had zero cash and no accounts receivable, total assets of $0 and working capital of ($18,594) compared to $115,137 in cash, $115,137 in total assets and working capital of $37,762 as of March 31, 2011. As of September 30, 2011, we have an accumulated deficit of $140,394.

    During the six months ended September 30, 2011 we had the net cash of $42,927 used in operating activities compared to $1,310 of net cash provided by our operating activities for the six months ended September 30, 2010, an increase in cash used in operating activities of $44,237. This is due to an increase in our net loss for the six months ended September 30, 2011. From our inception on July 6, 2007 to September 30, 2011, we have a total amount of $64,000 in cash through financing activities.

    From our inception on July 6, 2007 to September 30, 2011, we had net cash of $64,000 used in our operating activities. Our total future cash requirements exceed our current cash balances. Currently, we do not have sufficient cash in our bank accounts to cover our estimated expenses for the next 12 months if we expand our future operations. If we lost our one major customer we may not have been able to continue our business that is why we decide to change business plans and focus our efforts towards assisting companies that have begun gold mining, drilling, as well as work on water well drilling, trenching and construction. We anticipate meeting our future cash requirements through a combination of equity and debt financing.

    It may take several years for us to fully realize our business plan.

    We estimate that our expenses over the next 12 months (beginning July 1, 2011) will be approximately $140,000 as described in the table below. These estimates may change significantly depending on the nature of our future business activities and our ability to raise capital from shareholders or other sources.

      Target completion Estimated
    Description date or period expenses
    Legal and accounting fees 12 months 10,000
    Marketing and advertising 12 months 65,000
    Salaries and consulting fees 12 months 55,000
    General and administrative 12 months 10,000
    Total   140,000

    We intend to meet our cash requirements for the next 12 months through a combination of debt financing and equity financing by way of private placements. We currently do not have any arrangements in place for the completion of any further private placement financings and there is no assurance that we will be successful in completing any further private placement financings. There is no assurance that any financing will be available or if available, on terms that will be acceptable to us. We may not raise sufficient funds to fully carry out any business plan.

    We will also incur certain legal and accounting costs associated with the public reporting obligations in conjunction with being a public reporting company.

    Off-Balance Sheet Arrangements

    As of the date of this Report, we have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our stockholders.

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    Inflation

    The effect of inflation on our revenues and operating results has not been significant.

    Critical Accounting Policies

    Our financial statements are impacted by the accounting policies used and the estimates and assumptions made by management during their preparation. A complete listing of these policies is included in Note 2 of the notes to our financial statements for the three months ended September 30, 2011 and 2010 and from date of inception (July 6, 2007) to September 30, 2011. We have identified below the accounting policies that are of particular importance in the presentation of our financial position, results of operations and cash flows, and which require the application of significant judgment by management.

    Estimates

    The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. Actual results could differ from those estimates.

    Recent Accounting Pronouncements

    The Company does not expect that adoption of recently issued accounting pronouncements will have a material impact on its financial position, results of operations or cash flows.

    Item 3.     Quantitative And Qualitative Disclosures About Market Risk.

    Not Applicable

    Item 4.     Controls And Procedures.

    Evaluation of Disclosure Controls and Procedures

    We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Disclosure controls and procedures refer to controls and other procedures designed to ensure that information required to be disclosed in the reports we file or submit under the Securities Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

    As required by Rule 13a-15(e), our management has carried out an evaluation, with the participation and under the supervision of Todd Spinelli, our President and Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as of September 30, 2011. Based upon, and as of the date of this evaluation, Mr. Spinelli, determined that our disclosure controls and procedures were effective.

    Changes in Internal Control over Financial Reporting

    During the fiscal quarter ended September 30, 2011 there were no changes in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

    PART II - OTHER INFORMATION

    Item 1.     Legal Proceedings

    From time to time, we may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm business. We are currently not aware of any such legal proceedings or claims that will have, individually or in the aggregate, a material adverse affect on our business, financial condition or operating results.

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    Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds

    None.

    Item 3.     Defaults Upon Senior Securities

    None.

    Item 4.     Removed and Reserved

    Item 5.     Other Information

    None

    Item 6.     Exhibits

    (a) Exhibits

    Exhibit  
    Number       Description of Exhibit
    31* Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14 and Rule 15d-14(a), promulgated under the Securities and Exchange Act of 1934, as amended.
    32* Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002.

                                        
    * Filed herewith

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    SIGNATURES

    In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

      TBSS International, Inc. (Formerly Avenue South Ltd.)
       
    November 18, 2011 By: /s/ Todd Spinelli                                     
        Todd Spinelli
        President, Chief Executive Officer and
        Chief Financial Officer

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