AMERICA GREAT HEALTH Management’s Discussion and Analysis of Financial Condition and Results of Operations. (Form 10-Q/A)

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Notice of Forward-Looking Statement

Certain statements made in this Quarterly Report on Form 10-Q are “forward-looking statements” (as defined in the Private Securities Litigation Reform Act of 1995) regarding management’s plans and objectives for future operations. Such statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Crown Marketing (“we”, “us”, “our” or the “Company”) ) are materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements included herein are based on current expectations which involve numerous risks and uncertainties. The Company’s plans and objectives are based, in part, on assumptions regarding continued business expansion. Assumptions relating to the foregoing involve judgments regarding, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict with precision and many of which are beyond the Company’s control. Although the Company believes that its assumptions underlying the forward-looking statements are reasonable, each of these assumptions may prove to be incorrect and, therefore, there can be no assurance that the forward-looking statements included in this quarterly report will prove to be accurate. In light of the material uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be taken as a representation by the Company or any other person that the objectives and plans of the Company will be achieved.



History and Organization



America Great Health, formerly Crown Marketing, is a Wyoming company (the “Company”). A change of control of the Company was carried out on January 19, 2017
from Jay Hooper, the former officer and director of the Company and its former majority shareholder. Control was obtained through the sale of 16,155,746,000 ordinary shares of the Company to Mr. Hooper to a group of investors led by Mike Q.Wang. As part of the change of control, the Company sold a subsidiary to its former majority shareholder for $100 and another subsidiary in exchange for the cancellation of all debts and accrued liabilities. After December 31, 2016, the operations of the Company are determined and structured by the new group of investors. Accordingly, the Company has recognized all of its assets, liabilities and results of operations up to January 1, 2017 as discontinued operations.

At March 1, 2017, the Company has filed with the Secretary of State for the State of Wyoming articles of amendment to change the corporate name of Crown Marketing to America Great Health.

At March 9, 2017, the Company has formed a wholly-owned subsidiary, America Great Health, under the laws of the state of california.

At June 24, 2019, the Company registered a wholly-owned subsidiary in China,
Meizhong Health Industry Development Co., Ltd. The subsidiary is mainly engaged in mergers and acquisitions, investments and financings, and the marketing of medical equipment and healthcare products in China.

At June 30, 2020, the Company and Purecell Group (“Purecell”), a leading anti-aging medical institution in Australia, entered into a cooperation agreement, in which the Company undertook to acquire 51% of the capital of Purecell. In consideration for the acquisition, the Company will issue 510,000,000 common shares to the appointed trustee of Purecell. Following the acquisition transaction, Purecell will remain autonomous in its day-to-day operations, including the recruitment and retention of members of the management team. At
February 10, 2021, the Company has carried out its financial and legal due diligence. This transaction was completed in May 2021.

At December 7, 2020, the Company’s California subsidiary has entered into a cooperation agreement with Brilliant Healthcare Limited (“Brilliant”) pursuant to which the parties will establish a joint venture in China (the “JV Company“) for the purpose of promoting and developing the R & D, production, sales, raw materials, mergers and acquisitions and consulting services of stem cell products. After the formation of the JV Company is completed, the Company will invest $4.2 million in the JV Company in the next 24 months to hold 60% of the capital of JV Company. Brilliant will transfer its patented technology to JV Company in respect of its capital contribution, to hold 40% of the capital of the JV Company. In June 2021, the JV Company was established in Hainan, China like “Sijinsai (Hainan) Biological Tech Ltd.” At July 9, 2021, the Company paid the first investment of $50,000.

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  Table of Contents



Overview of Business


Our mission is to invest in innovative technologies integrated with business development in the healthcare ecosystem.

We focus on the research and development of small molecular protein and peptide drugs, diagnostic and medical devices with AI cloud computing, cell therapy and regenerative medicine, and the manufacture and sale of supplements.


Results of Operations


Results of operations for the three and nine months ended March 31, 2021
compared to the three and nine month periods ended March 31, 2020.

Sales amounted to $195,535 and $0 for the three months ended March 31, 2021 and 2020, respectively. Sales amounted to $195,671 and $0 for the nine months ended
March 31, 2021 and 2020, respectively. The increase in sales for the relevant comparative periods comes from the sale of products purchased on the open market to a customer who represented 99% of our total sales during the three months ended March 31, 2021.

The cost of goods sold was $143,905 and $0 for the three months ended March 31, 2021 and 2020, respectively. The cost of goods sold was $144,049 and $0
for the nine months ended March 31, 2021 and 2020, respectively. The increase in the cost of goods sold is due to the increase in sales.

Gross profit is $51,630 and $0 for the three months ended March 31, 2021 and 2020, respectively. Gross profit is $51,622 and $0 for the nine months ended March 31, 2021 and 2020, respectively. The increase in gross margin is due to the increase in sales.

Operating expenses incurred for the three months ended March 31, 2021 and 2020 have been $98,688 and $1,482, respectively. Operating expenses incurred for the nine months ended March 31, 2021 and 2020 have been $134,502 and $13,621, respectively. The increase during the relevant periods is mainly explained by the increase in professional fees.

Our net loss for the three months ended March 31, 2021 and 2020 was $49,215 and
$2,741, respectively. Our net loss for the nine months ended March 31, 2021 and 2020 was $88,155 and $18,052, respectively. The increase in net loss is mainly attributable to the increase in professional fees.

Cash and capital resources

Liquidity is the ability of a business to generate funds to support current and future operations, meet obligations, and otherwise operate on an ongoing basis. Important factors in managing liquidity are funds generated from operations, levels of accounts receivable and accounts payable, and capital expenditures.

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. As shown in the accompanying consolidated financial statements, the Company has incurred recurring net losses. For the nine months ended March 31, 2020, the Company recorded a net loss of $18,052, used cash to finance the operating activities of
$17,108, and cash provided by financing activities of $17,090. For the nine months ended March 31, 2021, the Company recorded a net loss of $88,155, used cash to finance the operating activities of $97,025, and cash provided by financing activities of $122,112. These factors create substantial doubt as to the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern.

Management’s plans to continue as a going concern revolve around its ability to achieve profitable operations, as well as raise the necessary capital to pay the ongoing general and administrative expenses of the Company. The Company’s ability to continue as a going concern depends on obtaining additional sources of capital and the success of the Company’s plan. There can be no assurance that the Company will be successful in raising additional capital or completing profitable transactions.

Our cash requirements for the nine months ended March 31, 2021 were mainly covered by loans and advances from the current majority shareholder. From March 31, 2021, we had a cash balance of $25,253. Our new majority shareholders will have to provide all of our working capital in the future.

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Contents

Mainly due to our recurring losses and lack of liquidity, we received a report from our independent registered accounting firm for our financial statements for the year ended June 30, 2020 which includes an explanatory paragraph describing the uncertainty about our ability to continue our business.



Financial Position



From March 31, 2021, we have had $25,253 in cash, negative working capital of
$346,654 and a cumulative deficit of $3,374,797.

Significant Accounting Policies and Estimates


Estimates


The preparation of these consolidated financial statements in accordance with generally accepted accounting principles in The United States of America
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the dates of the consolidated financial statements and the reported amounts of net sales and expenses during the reported periods . Actual results may differ from these estimates and such differences may be material to the financial statements. Management’s most significant estimates and assumptions include, among other things, the fair value of common shares issued in exchange for services. The current economic environment has increased the degree of uncertainty inherent in these estimates and assumptions.

Recent accounting pronouncements

See footnote 2 of the financial statements for a discussion of recently issued accounting standards.

Contractual obligations and off-balance sheet arrangements

We have no contractual obligations or off-balance sheet arrangements.

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