The information contained in this Form 10-Q is intended to update the
information contained in our Annual Report on Form 10-K for the year ended July
31, 2022 filed with the Securities and Exchange Commission on October 31, 2022
(the "Form 10-K") and presumes that readers have access to, and will have read,
the "Management's Discussion and Analysis of Financial Condition and Results of
Operations" and other information contained in such Form 10-K. The following
discussion and analysis also should be read together with our financial
statements and the notes to the financial statements included elsewhere in this
Form 10-Q.
Certain statements in this Report constitute forward-looking statements. These
forward-looking statements include statements, which involve risks and
uncertainties, regarding, among other things, (a) our projected sales,
profitability, and cash flows, (b) our growth strategy, (c) anticipated trends
in our industry, (d) our future financing plans, and (e) our anticipated needs
for, and use of, working capital. They are generally identifiable by use of the
words "may," "will," "should," "anticipate," "estimate," "plan," "potential,"
"project," "continuing," "ongoing," "expects," "management believes," "we
believe," "we intend," or the negative of these words or other variations on
these words or comparable terminology. In light of these risks and
uncertainties, there can be no assurance that the forward-looking statements
contained in this filing will in fact occur. You should not place undue reliance
on these forward-looking statements.
The forward-looking statements speak only as of the date on which they are made,
and, except to the extent required by federal securities laws, we undertake no
obligation to update any forward-looking statements to reflect events or
circumstances after the date on which the statements are made or to reflect the
occurrence of unanticipated events.
Company Overview
MU Global Holding Limited, the US Company, operates through its wholly owned
subsidiary, MU Worldwide Group Limited, a Seychelles Company; which operates
through its wholly owned subsidiary, MU Global Holding Limited, a Hong Kong
Company; which operates through its wholly owned subsidiary, MU Global Health
Management (Shanghai) Limited, a Shanghai Company. The US, Seychelles and Hong
Kong Companies act solely for holding purposes whereas all current and future
operations in China are planned to be carried out via MU Global Health
Management (Shanghai) Limited, the Shanghai Company. The purpose of the Hong
Kong Company is to function as the current regional hub of the Company.
At present, we have a physical office in Shanghai with address of Room 1510,
Building 5, Ark Times Square, 3148 Chengliu Middle Road, Jiading District,
Shanghai. In the future, we do not have definitive plans for which markets
intend to expand to, but we base our operations in Shanghai, as we prepare for
future unidentified expansion efforts.
All of the previous entities share the same exact business plan with the goal of
developing and providing wellness and beauty services to our future clients. We
aim to promote improved overall health and beauty in our clients through a
holistic detoxification method. We will, at least initially, primarily focus our
efforts on attracting customers in China. We have intentions, but no definitive
plans or timelines, to expand to Singapore, Malaysia, Hong Kong, and Middle
Eastern countries in the coming years, and subsequently we intend to make
efforts to expand throughout Asia. We anticipate spending a substantial amount
in marketing and advertising in the coming year.
3
Results of Operation
For the six months ended January 31, 2023 and 2022
Revenues
For the six months ended January 31, 2023 and 2022, the Company has generated
revenue of $128,241 and $38,787 respectively. The revenue represented income
from wellness and beauty services provided to customers, sales of products and
sharing of revenue from leasable equipment with business alliance and
franchisee.
Cost of Revenue and Gross Margin
For the six months ended January 31, 2023 and 2022, cost incurred arise in
providing wellness and beauty services and selling of essential oil is $108,844
and $17,396 respectively, and generate a gross profit the for the six months
ended January 31, 2023 and 2022 of $19,397 and $21,391.
Selling and marketing expenses
For the six months ended January 31, 2023 and 2022, we had incurred marketing
expenses in the amount of $278 and $579 respectively. The expense comprised of
travelling expenses.
General and administrative expenses
For the six months ended January 31, 2023 and 2022, we had incurred general and
administrative expenses in the amount of $72,628 and $168,560 respectively.
These expenses are comprised of salary, allowance, professional fees,
consultancy fee for IT and system management, office and outlet operation
expenses and depreciation.
Other Income
The Company recorded an amount of $2,358 and $26,933 as other income for the six
months ended January 31, 2023 and 2022. This income is derived from the interest
income, foreign exchange gain, gain on disposal and gain on measurement of
long-term liabilities.
Net Loss
Our net loss for six months ended January 31, 2023 and 2022 were $51,151 and
$120,815. The net loss mainly derived from the general and administrative
expenses incurred. The decrease in net loss of $69,664 as a result of higher
revenue generated during the period ended January 31, 2023.
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Liquidity and Capital Resources
As of January 31, 2023 and 2022, we had cash and cash equivalents of $7,785 and
$28,398 respectively. We expect increased levels of operations going forward
will result in more significant cash flow and in turn working.
We depend substantially on financing activities to provide us with the liquidity
and capital resources we need to meet our working capital requirements and to
make capital investments in connection with ongoing operations. During the
period ended January 31, 2023, the Company had met these requirements primarily
from the financial support from director and related company.
Cash Used in Operating Activities
For the six months ended January 31, 2023, net cash used in operating activities
was $28,629 as compared to net cash used in operating activities of $7,768 for
the six months ended January 31, 2022. The cash used in operating activities was
mainly for the payment of general and administrative expenses.
Cash Provided in Investing Activities
For the six months ended January 31, 2023 and 2022, the net cash used in
investing activities was $3,470 and net cash generated from investing activities
was $29,659. The investing cash flow performance primarily reflects the purchase
of property, plant and equipment and trademark and disposal of property, plant
and equipment.
Cash Provided in Financing Activities
For the six months ended January 31, 2023 and 2022, net cash provided by
financing activities was $37,452 and net cash used in financing activities was
$13,510 respectively. The financing cash flow performance primarily reflects the
provision of long-term loan by director and third party.
Credit Facilities
We do not have any credit facilities or other access to bank credit.
Off-balance Sheet Arrangements
We have no significant 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 as of January 31, 2023.
Recent Accounting Pronouncements
The Company has implemented all new accounting pronouncements that are in
effect. These pronouncements did not have any material impact on the financial
statements unless otherwise disclosed, and the Company does not believe that
there are any other new accounting pronouncements that have been issued that
might have a material impact on its financial position or results of operations.
5
For the three months ended January 31, 2023 and 2022
Revenues
For the three months ended January 31, 2023 and 2022, the Company has generated
revenue of $7,247 and $38,194 respectively. The revenue represented income from
wellness and beauty services provided to customers, sales of products and
sharing of revenue from leasable equipment with business alliance and
franchisee.
Cost of Revenue and Gross Margin
For the three months ended January 31, 2023 and 2022, cost incurred arise in
providing wellness and beauty services and selling of essential oil is $0 and
$17,209 respectively, and generate a gross profit the for the three months ended
January 31, 2023 and 2022 of $7,247 and $20,985.
Selling and marketing expenses
For the three months ended January 31, 2023 and 2022, we had incurred marketing
expenses in the amount of $3 and $435 respectively. The expense comprised of
travelling expenses.
General and administrative expenses
For the three months ended January 31, 2023 and 2022, we had incurred general
and administrative expenses in the amount of $26,200 and $97,462 respectively.
These expenses are comprised of salary, allowance, professional fees,
consultancy fee for IT and system management, office and outlet operation
expenses and depreciation.
Other Income
The Company recorded an amount of $617 and $5,387 as other income for the three
months ended January 31, 2023 and 2022. This income is derived from the interest
income, foreign exchange gain, gain on disposal and gain on measurement of
long-term liabilities.
Net Loss
Our net loss for three months ended January 31, 2023 and 2022 were $18,339 and
$71,525. The net loss mainly derived from the general and administrative
expenses incurred. The decrease in net loss of $53,186 was mainly due to lower
spend in general and administrative expenses during the period ended January 31,
2023.
6
Credit Facilities
We do not have any credit facilities or other access to bank credit.
Off-balance Sheet Arrangements
We have no significant 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 as of January 31, 2023.
Recent Accounting Pronouncements
The Company has implemented all new accounting pronouncements that are in
effect. These pronouncements did not have any material impact on the financial
statements unless otherwise disclosed, and the Company does not believe that
there are any other new accounting pronouncements that have been issued that
might have a material impact on its financial position or results of operations.
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