Quarterly Report (10-q)

Date : 06/10/2019 @ 7:03PM
Source : Edgar (US Regulatory)
Stock : Resort Savers, Inc. (QB) (RSSV)
Quote : 3.05  -0.15 (-4.69%) @ 4:32PM

Quarterly Report (10-q)

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

 

(Mark One)

 

x

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2019

 

or

 

¨

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from __________ to __________

 

Commission File Number 000-55319

 

Resort Savers, Inc.

(Exact name of registrant as specified in its charter)

 

Nevada

 

46-1993448

(State or other jurisdiction

of incorporation or organization)

 

(IRS Employer

Identification No.)

 

Level 11, Tower 4, Puchong Financial Corporate Centre (PFCC)

Jalan Puteri 1/2, Bandar Puteri, 47100 Puchong, Malaysia

 

47100

(Address of principal executive offices)

 

(Zip Code)

 

+60 3 8600 0313

(Registrant’s telephone number, including area code)

 

N/A

(Former name, former address and former fiscal year, if changed since last report)

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

None

 

N/A

 

N/A

 

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. x YES     o NO

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). x YES     o NO

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

o

Accelerated filer

o

Non-accelerated filer

x

Smaller reporting company

x

Emerging growth company

x

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) o YES     x NO

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

As of June 10, 2019, there were 520,976,241 shares of the issuer’s common stock, par value $0.0001 per share, outstanding.

 

 
 
 
 

TABLE OF CONTE NTS

 

PART I - FINANCIAL INFORMATION

 

Item 1.

Financial Statements

F-1

 

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

3

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

9

 

Item 4.

Controls and Procedures

9

 

PART II - OTHER INFORMATION

 

 

Item 1.

Legal Proceedings

10

 

Item 1A.

Risk Factors

10

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

10

 

Item 3.

Defaults Upon Senior Securities

10

 

Item 4.

Mine Safety Disclosures

10

 

Item 5.

Other Information

10

 

Item 6.

Exhibits

11

 

SIGNATURES

12

  

 

2

 
Table of Contents

 

PART I - FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

INDEX TO THE UNAUDITED INTERIM FINANCIAL STATEMENTS

 

PERIOD ENDED MARCH 31, 2019

 

TABLE OF CONTENTS

 

Page

 

Consolidated Balance Sheets

F-2

 

Consolidated Statements of Operations and Other Comprehensive Income (Loss)

F-3

 

Consolidated Statements of Shareholders’ Equity

F-4

 

Consolidated Statements of Cash Flows

F-5

 

Notes to the Consolidated Financial Statements

F-6

 

 
F-1
 
 

 

RESORT SAVERS, INC.

Consolidated Balance Sheets

(Unaudited)

 

 

 

March 31,

 

 

December 31,

 

 

 

2019

 

 

2018

 

ASSETS

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash and cash equivalents

 

$ 180,522

 

 

$ 257,391

 

Accounts receivable

 

 

12,185,995

 

 

 

38,165,057

 

Inventory

 

 

2,791,090

 

 

 

1,245,759

 

Other current assets

 

 

88,068

 

 

 

42,275

 

Due from related parties

 

 

945,381

 

 

 

155,075

 

Total Current Assets

 

 

16,191,056

 

 

 

39,865,557

 

Property and Equipment, net

 

 

534,492

 

 

 

551,548

 

Goodwill

 

 

3,199,594

 

 

 

3,199,594

 

TOTAL ASSETS

 

$ 19,925,142

 

 

$ 43,616,699

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

Accounts payable

 

$ 7,092,930

 

 

$ 32,593,531

 

Accrued liabilities and other payable

 

 

1,491,884

 

 

 

95,458

 

Deferred revenue

 

 

45,695

 

 

 

56,416

 

Due to related parties

 

 

1,133,817

 

 

 

1,115,705

 

Tax payable

 

 

214,956

 

 

 

229,729

 

Total Current Liabilities

 

 

9,979,282

 

 

 

34,090,839

 

 

 

 

 

 

 

 

 

 

Deferred tax liabilities

 

 

40,861

 

 

 

40,349

 

TOTAL LIABILITIES

 

 

10,020,143

 

 

 

34,131,188

 

 

 

 

 

 

 

 

 

 

COMMITMENTS AND CONTINGENCIES

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Preferred stock, $0.0001 par value; 15,000,000 shares authorized; no shares issued and outstanding

 

 

-

 

 

 

-

 

Common stock, $0.0001 par value; 1,000,000,000 shares authorized; 520,976,241 shares issued and outstanding

 

 

52,098

 

 

 

52,098

 

Additional paid-in capital

 

 

8,884,686

 

 

 

8,884,686

 

Retained earnings

 

 

1,263,014

 

 

 

991,525

 

Accumulated other comprehensive loss

 

 

(294,799 )

 

 

(442,798 )

Total equity

 

 

9,904,999

 

 

 

9,485,511

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$ 19,925,142

 

 

$ 43,616,699

 

 

The notes are an integral part of these unaudited consolidated financial statements.

 

 
F-2
 
Table of Contents

 

RESORT SAVERS, INC.

Consolidated Statements of Operations and Other Comprehensive Income (Loss)

( Unaudited )

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2019

 

 

2018

 

 

 

 

 

 

 

 

Revenue

 

$ 14,781,045

 

 

$ 211,032

 

Cost of goods sold

 

 

14,169,390

 

 

 

156,151

 

Gross Profit

 

 

611,655

 

 

 

54,881

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

General and administrative

 

 

182,744

 

 

 

190,603

 

Professional fees

 

 

26,245

 

 

 

-

 

Total Operating Expenses

 

 

208,989

 

 

 

190,603

 

 

 

 

 

 

 

 

 

 

Income (Loss) From Operations

 

 

402,666

 

 

 

(135,722 )

 

 

 

 

 

 

 

 

 

Other Income

 

 

 

 

 

 

 

 

Other income

 

 

134

 

 

 

2,071

 

Total Other Income

 

 

134

 

 

 

2,071

 

 

 

 

 

 

 

 

 

 

Income (Loss) Before Income Taxes

 

 

402,800

 

 

 

(133,651 )

Provision for income taxes

 

 

(131,311 )

 

 

20,797

 

Net Income (Loss)

 

$ 271,489

 

 

$ (112,854 )

 

 

 

 

 

 

 

 

 

Other Comprehensive Income

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

$ 147,999

 

 

$ 37,403

 

Total Comprehensive Income (Loss)

 

$ 419,488

 

 

$ (75,451 )

 

 

 

 

 

 

 

 

 

Basic and Diluted Income (Loss) per Common Share

 

$ 0.00

 

 

$ (0.00 )

Basic and Diluted Weighted Average Common Shares Outstanding

 

 

520,976,241

 

 

 

400,000,000

 

 

The notes are an integral part of these unaudited consolidated financial statements.

 

 
F-3
 
Table of Contents

 

RESORT SAVERS, INC.

Consolidated Statements of Shareholders’ Equity

( Unaudited )

 

Three Months Ended March 31, 2019

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

Common Stock

 

 

Additional

 

 

 

 

 

Other

 

 

Total

 

 

 

Number of

Shares

 

 

Amount

 

 

Paid-in

Capital

 

 

Retained

Earnings

 

 

Comprehensive

Loss

 

 

Stockholders'

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - December 31, 2018

 

 

520,976,241

 

 

$ 52,098

 

 

$ 8,884,686

 

 

$ 991,525

 

 

$ (442,798 )

 

$ 9,485,511

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

271,489

 

 

 

-

 

 

 

271,489

 

Other comprehensive income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

147,999

 

 

 

147,999

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - March 31, 2019

 

 

520,976,241

 

 

$ 52,098

 

 

$ 8,884,686

 

 

$ 1,263,014

 

 

$ (294,799 )

 

$ 9,904,999

 

 

Three Months Ended March 31, 2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

Common Stock

 

 

Additional

 

 

 

 

 

Other

 

 

Total

 

 

 

Number of

Shares

 

 

Amount

 

 

Paid-in

Capital

 

 

Accumulated

Deficit

 

 

Comprehensive

Income

 

 

Stockholders'

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - December 31, 2017

 

 

400,000,000

 

 

$ 40,000

 

 

$ 1,166,475

 

 

$ (464,343 )

 

$ 15,193

 

 

$ 757,325

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(112,854 )

 

 

-

 

 

 

(112,854 )

Other comprehensive income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

37,403

 

 

 

37,403

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance - March 31, 2018

 

 

400,000,000

 

 

$ 40,000

 

 

$ 1,166,475

 

 

$ (577,197 )

 

$ 52,596

 

 

$ 681,874

 

 

The notes are an integral part of these unaudited consolidated financial statements.

 

 
F-4
 
Table of Contents

 

RESORT SAVERS, INC.

Consolidated Statements of Cash Flows

( Unaudited )

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2019

 

 

2018

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

Net income (loss)

 

$ 271,489

 

 

$ (112,854 )

Adjustments to reconcile net loss to net cash from operating activities:

 

 

 

 

 

 

 

 

Depreciation

 

 

24,027

 

 

 

27,532

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Amount due from related parties

 

 

(784,101 )

 

 

(2,707 )

Accounts receivable

 

 

26,771,083

 

 

 

(45,847 )

Inventories

 

 

(1,525,401 )

 

 

128,628

 

Other current assets

 

 

(45,158 )

 

 

11,000

 

Accounts payable

 

 

(26,165,313 )

 

 

13,304

 

Deferred revenue

 

 

(11,413 )

 

 

604

 

Amount due to related parties

 

 

-

 

 

 

(15,528 )

Tax payable

 

 

(19,474 )

 

 

(20,797 )

Accrued liabilities and other payable

 

 

1,392,750

 

 

 

11,640

 

Net cash used in operating activities

 

 

(91,511 )

 

 

(5,025 )

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

Bank overdraft

 

 

-

 

 

 

(4,071 )

Loans from related parties

 

 

11,237

 

 

 

-

 

Repayments of loans from related parties

 

 

(2,489 )

 

 

-

 

Net cash provided by (used in) financing activities

 

 

8,748

 

 

 

(4,071 )

 

 

 

 

 

 

 

 

 

Effects on changes in foreign exchange rate

 

 

5,894

 

 

 

8,107

 

 

 

 

 

 

 

 

 

 

Net change in cash and cash equivalents

 

 

(76,869 )

 

 

(989 )

Cash and cash equivalents - beginning of period

 

 

257,391

 

 

 

989

 

Cash and cash equivalents - end of period

 

$ 180,522

 

 

$ -

 

 

 

 

 

 

 

 

 

 

Supplemental Cash Flow Disclosures

 

 

 

 

 

 

 

 

Cash paid for interest

 

$ -

 

 

$ -

 

Cash paid for income taxes

 

$ 45,485

 

 

$ -

 

 

The notes are an integral part of these unaudited consolidated financial statements.

 

 
F-5
 
Table of Contents

 

RESORT SAVERS, INC.

Notes to the Consolidated Financial Statements

March 31, 2019

Expressed in United States Dollars

( Unaudited )

 

NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS

 

Resort Savers, Inc. (“we,” “us,” “our,” the “Company,” “Resort Savers” or “RSSV”) is a Nevada corporation incorporated on June 25, 2012. It is based in Shenzhen, the People’s Republic of China (the “PRC”). The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America, and the Company’s fiscal year end is December 31.

 

The Company makes investments and acquisitions into sound, transparent markets and industries throughout the world. The Company is principally engaged in the trading of oil, gas and lubricant, as well as an agricultural business and provides nutrition consultancy services and training as well as selling health products through an online store.

 

Admall Share Exchange and Recapitalization

 

Admall Sdn. Bhd.

 

On May 16, 2018, the Company closed the acquisition of Admall Sdn. Bhd., a limited liability company incorporated in Malaysia (“Admall”) by way of share exchange (the “Admall Acquisition”). The Company effected the Admall Acquisition pursuant to the terms of that certain Share Exchange Agreement (the “Admall Agreement”), dated February 9, 2018, by and between the Company, Admall, and Mr. Boon Jin “Patrick” Tan, an individual who prior to the closing of the Admall Acquisition held 100% of the outstanding equity interests of Admall. See Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Securities Exchange Commission on February 9, 2018, which is incorporated herein by reference, for a detailed description of the Admall Agreement.

 

At the closing of the Admall Acquisition, the Company acquired 100% of the outstanding equity interests of Admall from Mr. Tan, and the Company issued 400,000,000 shares of its common stock, par value $0.0001 per share (“Common Stock”) to Mr. Tan, which at the time of closing represented approximately 81.47% of the Company’s issued and outstanding Common Stock. As a result, Mr. Tan became a stockholder of the Company and Admall became a wholly-owned subsidiary of the Company. For federal income tax purposes, the Admall Acquisition was intended to qualify as a tax-free reorganization under the provisions of Section 368(a) of the Internal Revenue Code of 1986, as amended.

 

For financial accounting purposes, the Admall Agreement has been accounted for as a reverse acquisition by Admall and resulted in a recapitalization of the Company, with Admall being the accounting acquirer and the Company as the acquired entity. The consummation of the Admall Agreement resulted in a change of control of RSSV. Accordingly, the historical financial statements prior to the acquisition are those of the accounting acquirer, Admall, and have been prepared to give retroactive effect to the reverse acquisition completed on May 16, 2018 and represent the operations of Admall.

 

As a result of the above, these consolidated financial statements represent Admall as the accounting acquirer (legal acquiree) and RSSV, from May 16, 2018 forward, as the accounting acquiree (legal acquirer), and the legal capital stock (number and type of equity interests issued) is that of RSSV, the legal parent, in accordance with guidance on reverse acquisitions accounted for as a business combination. Therefore, the Company recognized goodwill of $3,199,594.

 

 
F-6
 
Table of Contents

 

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of Presentation

 

The Company prepares its financial statements in accordance with rules and regulations of the U.S. Securities and Exchange Commission (SEC) and generally accepted accounting principles (“GAAP”) in the United States of America. The accompanying consolidated financial statements have been prepared in accordance with GAAP for interim financial information in accordance with Article 8 of Regulation S-X and presented in United States dollars.

 

The amounts shown in these financial statements for periods prior to May 16, 2018 are those of Admall.

 

In the opinion of the company’s management, the accompanying unaudited interim consolidated financial statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present the financial position of the company as of March 31, 2019 and the results of operations and cash flows for the periods presented. The results of operations for the three months ended March 31, 2019 are not necessarily indicative of the operating results for the full fiscal year or any future period. These unaudited interim consolidated financial statements should be read in conjunction with the financial statements and related notes thereto included in the company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the SEC on May 17, 2018.

 

Principles of Consolidation

 

At March 31, 2019, the principal subsidiaries of the Company were listed as follows:

 

Entity Name

 

Acquisition

Date

 

Ownership

 

 

Jurisdiction

 

Investments

Held By

 

Nature of

Operation

 

Fiscal

Year

 

Admall Sdn. Bhd.

 

May 16,

2018

 

 

100 %

 

Malaysia

 

RSSV

 

Nutritional Services

 

December 31

 

Xing Rui International Investment Holding Group Co., Ltd. (“Xing Rui”)

 

December 22,

2014

 

 

100 %

 

Seychelles

 

RSSV

 

Holding

Company

 

January 31

 

Xing Rui International Investment Group Ltd. (“Xing Rui HK”)

 

December 22,

2014

 

 

100 %

 

Hong Kong,

the PRC

 

Xing Rui

 

Holding

Company

 

January 31

 

Huaxin Changrong (Shenzhen) Technology Service Co., Ltd. (“Huaxin”) *

 

August 27, 

2015

 

 

100 %

 

the PRC

 

Xing Rui

 

Holding

Company

 

December 31

 

Beijing Yandong Tieshan Oil Products Co., Ltd. (“Tieshan Oil”) *

 

January 29,

2016

 

 

51 %

 

the PRC 

 

Huaxin

 

Trading of oil products

 

December 31

 

 

 

May 16,

2018

 

 

49 %

 

 

 

 

 

 

 

 

__________

*

The English names used are translated only.

 

These consolidated financial statements include the accounts of the Company and its subsidiaries. All material intercompany balances and transactions have been eliminated.

 

Use of Estimates and Assumptions

 

The preparation of financial statements in conformity with GAAP 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. The estimates and judgments will also affect the reported amounts for certain revenues and expenses during the reporting period. Actual results could differ from these good faith estimates and judgments.

 

Foreign Currency Translation and Re-measurement

 

The Company translates its foreign operations to U.S. dollars in accordance with ASC 830, “ Foreign Currency Matters ”.

 

 
F-7
 
Table of Contents

 

The Company’s functional currency and reporting currency is the U.S. dollar, and our subsidiaries’ functional currency is the Chinese Yuan Renminbi (“CNY”), Malaysian Ringgit (“MYR”) and Hong Kong Dollar (“HKD”).

 

The translate its records into U.S. dollar as follows:

 

 

· Assets and liabilities at the rate of exchange in effect at the balance sheet date

 

· Equities at historical rate

 

· Revenue and expense items at the average rate of exchange prevailing during the period

 

Concentrations of Credit Risk

 

The Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents, and accounts receivable. The Company places its cash and cash equivalents with financial institutions of high credit worthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits. The Company also reviews its accounts receivable in a timely manner. The Company’s management plans to assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposures are limited.

 

Tieshan Oil

 

During the three months ended March 31, 2019, one customer, who is a related party, accounted for 99% of revenues from related party.

 

As of March 31, 2019 and December 31, 2018, one customer accounted for approximately 94% and 98% of accounts receivable, one vendor accounted for approximately 88% and two vendors for approximately 96% of accounts payable, respectively.

 

Earnings Per Share of Common Stock

 

The Company has adopted ASC Topic 260, ”Earnings per Share,” (“EPS”) which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying financial statements, basic earnings per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.

 

The Company has no potentially dilutive securities, such as options or warrants, currently issued and outstanding.

 

Recent Accounting Pronouncements

 

Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.

 

NOTE 3 - GOING CONCERN

 

The Company’s consolidated financial statements are prepared using GAAP applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet had sufficient revenues to cover its operating cost, and requires additional capital to commence its operating plan. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about its ability to continue as a going concern.

 

In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan to obtain such resources for the Company include: sales of equity instruments; traditional financing, such as loans; and obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.

 

 
F-8
 
Table of Contents

 

There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. In addition, profitability will ultimately depend upon the level of revenues received from business operations. However, there is no assurance that the Company will attain profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

 

NOTE 4 – ACCOUNTS RECEIVABLE

 

The Company has performed an analysis on all of its accounts receivable and determined that all amounts are collectible by the Company. As such, all accounts receivable are reflected as a current asset and no allowance for bad debt has been recorded as of March 31, 2019 and December 31, 2018. As at March 31, 2019 and December 31, 2018, the Company had accounts receivable of $12,185,995 and $38,165,057, respectively and trade receivables from customers which are related to the Company of $11,478,115 and $37,055,058 are included in accounts receivable.

 

NOTE 5 – INVENTORIES

 

Inventories at March 31, 2019 and December 31, 2018 consist of the following:

 

 

 

March 31,

 

 

December 31,

 

 

 

2019

 

 

2018

 

 

 

 

 

 

 

 

Finished goods

 

$ 2,791,090

 

 

$ 1,245,759

 

 

NOTE 6 – PROPERTYAND EQUIPMENT

 

Plant and equipment at March 31, 2019 and December 31, 2018 consist of the following:

 

 

 

March 31,

 

 

December 31,

 

 

 

2019

 

 

2018

 

Cost:

 

 

 

 

 

 

Computer and software

 

$ 78,138

 

 

$ 77,157

 

Furniture and fittings

 

 

4,376

 

 

 

4,322

 

Office equipment

 

 

5,252

 

 

 

5,186

 

Plant and machinery

 

 

784,031

 

 

 

773,618

 

 

 

 

871,797

 

 

 

860,283

 

Less: accumulated depreciation

 

 

(337,305 )

 

 

(308,735 )

Property and Equipment, net

 

$ 534,492

 

 

$ 551,548

 

 

During the three months ended March 31, 2019 and 2018, the Company recorded depreciation of $24,027 and $27,532, respectively.

 

NOTE 7 –ACCRUED LIABILITIES AND OTHER PAYABLE

 

The Company’s accounts payable and accrued liabilities consist of the followings:

 

 

 

March 31,

 

 

December 31,

 

 

 

2019

 

 

2018

 

Accrued expenses

 

$ 70,613

 

 

$ 45,000

 

Deposit received

 

 

4,524

 

 

 

-

 

Other payables

 

 

1,414,842

 

 

 

50,458

 

Credit Card

 

 

1,905

 

 

 

-

 

 

 

$ 1,491,884

 

 

$ 95,458

 

 

 
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Table of Contents

 

NOTE 8 - STOCKHOLDERS’ EQUITY

 

The capitalization of the Company consists of the following classes of capital stock as of March 31, 2019:

 

Preferred Stock

 

The Company has authorized 15,000,000 shares of preferred stock with a par value of $0.0001 per share. The Board of Directors are authorized to divide the authorized shares of Preferred Stock into one or more series, each of which shall be so designated as to distinguish the shares thereof from the shares of all other series and classes. No shares of preferred stock have been issued.

 

Common Stock

 

The Company has authorized 1,000,000,000 shares of common stock with a par value of $0.0001 per share. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.

 

During the three months ended March 31, 2019, there were no issuances of common stock.

 

As at March 31, 2019 and December 31, 2018, the Company had 520,976,241 common shares issued and outstanding.

 

The Company has no stock option plan, warrants or other dilutive securities.

 

NOTE 9 – RELATED PARTY TRANSACTIONS

 

Revenue and Expense

 

During the three months ended March 31, 2019 and 2018, the Company recorded revenue from related party of $14,664,803 and $0 and cost of goods sold from a related party of $14,154,294 and $0 and general and administrative expense from a related party of $4,446 and $0, respectively. As of March 31, 2019 and December 31, 2018, the Company had accounts receivable from related party of $11,478,115 and $37,055,058 and account payable to related party of $6,210,968 and $31,536,276, which is included in accounts payable, respectively

 

Due from related party

 

As of March 31, 2019 and December 31, 2018, the Company recorded due from related parties as follows. The loan is non-interest bearing and due on demand.

 

 

 

March 31,

 

 

December 31,

 

 

 

2019

 

 

2018

 

Prepayment

 

$ 788,334

 

 

$ -

 

Loan to related parties

 

 

157,047

 

 

 

155,075

 

 

 

$ 945,381

 

 

$ 155,075

 

 

Due to related party

 

As of March 31, 2019 and December 31, 2018, the Company recorded due to related parties as follows. The loan is non-interest bearing and due on demand.

 

March 31,

December 31,

2019

2018

Loan from director

$ 1,013,557 $ 1,022,775

Loan from related parties

120,260 92,930
$ 1,133,817 $ 1,115,705

 

 
F-10
 
Table of Contents

 

NOTE 10 - SEGMENTED INFORMATION

 

At March 31, 2019, the Company operates in two industry segments, health beverage and oil and gas, and two geographic segments, Malaysia and China, where majority current assets and equipment are located.

 

Segment assets and liabilities as of March 31, 2019 and December 31, 2018 were as follows:

 

March 31, 2019

 

Holding

Company

 

 

Oil

and gas

 

 

Nutritional

Services

 

 

Total

Consolidated

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

$ 3,190

 

 

$ 13,080,332

 

 

$ 3,107,534

 

 

$ 16,191,056

 

Non-current assets

 

 

3,199,594

 

 

 

-

 

 

 

534,492

 

 

 

3,734,086

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

172,275

 

 

 

7,234,096

 

 

 

2,572,911

 

 

 

9,979,282

 

Long term liabilities

 

 

-

 

 

 

-

 

 

 

40,861

 

 

 

40,861

 

Net assets

 

$ 3,030,509

 

 

$ 5,846,236

 

 

$ 1,028,254

 

 

$ 9,904,999

 

  

December 31, 2018

 

Holding

Company

 

 

Oil

and gas

 

 

Nutritional

Services

 

 

Total

Consolidated

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Current assets

 

$ 3,545

 

 

$ 38,020,730

 

 

$ 1,841,282

 

 

$ 39,865,557

 

Non-current assets

 

 

1,219,807

 

 

 

1,981,195

 

 

 

550,140

 

 

 

3,751,142

 

Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current liabilities

 

 

167,010

 

 

 

32,703,644

 

 

 

1,220,185

 

 

 

34,090,839

 

Long term liabilities

 

 

-

 

 

 

-

 

 

 

40,349

 

 

 

40,349

 

Net assets

 

$ 1,056,342

 

 

$ 7,298,281

 

 

$ 1,130,888

 

 

$ 9,485,511

 

 

Segment revenue and net income (loss) for the three and three months ended March 31, 2019 and 2018 were as follows:

 

Three Months Ended March 31, 2019

 

Holding

Company

 

 

Oil

and gas

 

 

Nutritional

Services

 

 

Total

Consolidated

 

Revenue

 

$ -

 

 

$ 14,664,803

 

 

$ 116,242

 

 

$ 14,781,045

 

Cost of goods sold

 

 

-

 

 

 

(14,118,726 )

 

 

(50,664 )

 

 

(14,169,390 )

Operating expenses

 

 

(5,687 )

 

 

(20,834 )

 

 

(182,468 )

 

 

(208,989 )

Other income

 

 

-

 

 

 

-

 

 

 

134

 

 

 

134

 

Provision for income taxes

 

 

-

 

 

 

(131,311 )

 

 

-

 

 

 

(131,311 )

Net income (loss)

 

$ (5,687 )

 

$ 393,932

 

 

$ (116,756 )

 

$ 271,489

 

 

Three Months Ended March 31, 2018

 

Holding

Company

 

 

Oil

and gas

 

 

Nutritional

Services

 

 

Total

Consolidated

 

Revenue

 

$ -

 

 

$ -

 

 

$ 211,032

 

 

$ 211,032

 

Cost of goods sold

 

 

-

 

 

 

-

 

 

 

(156,151 )

 

 

(156,151 )

Operating expenses

 

 

-

 

 

 

-

 

 

 

(190,603 )

 

 

(190,603 )

Other income

 

 

-

 

 

 

-

 

 

 

2,071

 

 

 

2,071

 

Provision for income taxes

 

 

-

 

 

 

-

 

 

 

20,797

 

 

 

20,797

 

Net loss

 

$ -

 

 

$ -

 

 

$ (112,854 )

 

$ (112,854 )

 

 

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Table of Contents

 

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

 

FORWARD-LOOKING STATEMENTS

 

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Because they discuss future events or conditions, forward-looking statements may include words such as “anticipate,” “believe,” “estimate,” “intend,” “could,” “should,” “would,” “may,” “seek,” “plan,” “might,” “will,” “pursue,” “expect,” “predict,” “project,” “goals,” “strategy,” “future,” “likely,” “forecast,” “potential,” “continue,” negatives thereof or similar references to future periods. Examples of forward-looking statements include, among others, statements we make regarding future acquisition or merger targets, business strategies, macro-economic and sector-specific trends, future cash flows, financing plans, plans and objectives of management and any other statements which are not statements of historical facts.

 

Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual future results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, inability to successfully conclude acquisitions of target companies or assets which are reasonably capable of generating positive cash flow in the near future, legal and regulatory changes in the jurisdictions in which we operate, volatility or decline in our stock price, mismanagement of our subsidiaries by local managers, potential fluctuation of our quarterly and annual financial and operational results, rapid adverse changes in markets, decline in demand for our goods and services, insufficient revenues to cover our operating costs and such other factors as discussed throughout this Part I, Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations of this Quarterly Report on Form 10-Q.

 

Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

 

Overview

 

Resort Savers, Inc. was incorporated in the State of Nevada on June 25, 2012. At formation, the Company was authorized to issue 100,000,000 shares of common stock, par value $0.0001 per share (“Common Stock”), and 15,000,000 shares of preferred stock, par value $0.0001 per share (“Preferred Stock”). On July 3, 2018, the Company’s board of directors (the “Board of Directors”) approved a change in our fiscal year end from January 31 to December 31. The Company now operates on a fiscal year ending on December 31. Resort Savers has limited cash on hand. We have sustained losses since inception and have relied solely upon the sale of our securities and loans for funding. Resort Savers has never declared bankruptcy, been in receivership, or been involved in any kind of legal proceeding.

 

On August 1, 2014, a change of control of the Company occurred, whereby a controlling interest in the Company was sold by Michelle LaCour, our former President, Chief Executive Officer, Chief Financial Officer, Treasurer and Director and a former 5% stockholder, and James LaCour, our former Secretary and Director and a former 5% stockholder, to the following: (1) Zhou Gui Bin (236,733 shares at a purchase price of $0.20 per share); (2) Zhou Wei (236,733 shares at a purchase price of $0.20 per share); and (3) Zong Xin International Investment Holdings Co. LTD (“Zong Xin”) (1,636,734 shares at a purchase price of $0.20 per share). On August 11, 2014, in connection with the transfer of shares described in this paragraph, Ms. LaCour and Mr. LaCour resigned from each of their roles as officers and Directors of the Company, and they were replaced by Zhou Gui Bin as President, CEO and Director, and Zhou Wei as Treasurer, CFO, Secretary and Director.

 

On September 25, 2014 the Company effected a forward ten-for-one (10-for-1) stock split on its Common Stock, having the equivalent effect of issuing an additional nine shares of Common Stock for each share of Common Stock outstanding immediately prior to the effective date of the forward stock split. All share and per share information has been retroactively restated for financial presentation of prior periods.

 

 
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Worx America, Inc.

 

From January 2015 through March 2015, the Company, by and through its wholly owned subsidiary, Xing Rui International Investment Holding Group Co., Ltd. (“Xing Rui”), acquired 20,068,750 shares of common stock (representing 20% of the issued and outstanding common stock) of Worx America, Inc. (“Worx”), a private company based in Houston, Texas, in exchange for $1,650,000 cash and 1,000,000 shares of common stock of Borneo Resource Investments Ltd. (“BRNE”) with a value of $350,000. Specifically, on January 28, 2015, the Company paid $350,000 cash in exchange for 5,403,728 common shares of Worx, on March 20, 2015, the Company paid $1,300,000 cash and transferred 1,000,000 shares of common stock of BRNE in exchange for 14,665,022 common shares of Worx. The Company accounted for this investment using the equity method, with an initial cost of $2,000,000.

 

Worx designs automated solutions for industrial, environmental and energy industries to improve efficiency and systems output. The Worx automated robotic tank cleaning system reduces tank cleaning time, reduces or eliminates the need for personnel to enter tanks, and may reduce the volume of solvents used to clean a tank.

 

A description of the products, services, principal market and distribution methods of Worx can be found within this Part I, Item 1 under the heading “Principal Products, Services and Their Markets.”

 

Shenzhen Amuli Industrial Development Co. Ltd.

 

On October 1, 2015, the Company issued 3,033,926 shares of its Common Stock to Xu Xiao Yun in exchange for sixty percent (60%) of Shenzhen Amuli Industrial Development Co. Ltd., a PRC corporation (“Amuli”). The equity of Amuli that was transferred by Xu Xiao Yun was held by Huaxin Changrong (Shenzhen) Technology Service Co., Ltd. (“Huaxin”), which was formed by Xing Rui for the purpose of holding the equity of Amuli and other PRC subsidiaries. The purchase price was valued $2,400,000.

 

On November 19, 2018, the Company disposed of its partial ownership interest in Amuli by causing Huaxin and Amuli to enter into a Share Purchase Agreement (the “Amuli Disposition Agreement”) with Ms. An Wenhui, a citizen of the PRC and minority shareholder of Amuli (the “Purchaser”), pursuant to which, among other things and subject to the terms and conditions contained therein, Huaxin sold its sixty percent (60%) Amuli equity stake (the “Amuli Shares”) to the Purchaser (the “Amuli Disposition”). Pursuant to the Amuli Disposition Agreement, in exchange for the Amuli Shares, the Purchaser paid to Huaxin a cash price of $1 or the equivalent thereof in Chinese Yuan (the “Purchase Price”). Our Board of Directors approved the Amuli Disposition Agreement, the Amuli Disposition and the Purchase Price, because among other reasons the Board of Directors believed that Amuli would not produce significant future income or cash flow. The Amuli Disposition Agreement contains substantially fewer representations and warranties in comparison to other agreements entered into by the Company and its subsidiaries. Additionally, the closing of the Amuli Disposition occurred contemporaneously with the signing of the Amuli Disposition Agreement, which resulted in little or no covenants or closing conditions imposed on the parties. As a result, Amuli is no longer a partially-owned subsidiary of the Company.

 

Amendment to Articles of Incorporation

 

On October 9, 2015, we amended our Articles of Incorporation to increase the maximum number of authorized shares of Common Stock to 1,000,000,000 shares. We did not amend the amount of authorized shares of Preferred Stock or par values for Common Stock or Preferred Stock.

  

Beijing Yandong Tieshan Oil Products Co., Ltd.

 

On January 29, 2016, the Company entered into an exchange agreement (the “Tieshan Oil Exchange Agreement”) with Mr. Yang Baojin (“Mr. Yang”), a citizen of the PRC, and the Company’s subsidiary Huaxin. Mr. Yang was the president and majority owner of Beijing Yandong Tieshan Oil Products Co., Ltd. (“Tieshan Oil”). Pursuant to the Tieshan Oil Exchange Agreement, the Company issued 4,800,000 shares of its Common Stock to Mr. Yang, who delivered to Huaxin an ownership interest in Tieshan Oil such that Huaxin at the time of closing owned 51% of all ownership interests in Tieshan Oil (the “Tieshan Oil Exchange”). The Company held 1,200,000 shares of its Common Stock in escrow (the “Escrow Shares”) to issue to Mr. Yang twelve months following the closing of the Tieshan Oil Exchange, in connection with the successful performance of certain covenants by Mr. Yang. The Company did not issue the Escrow Shares to Mr. Yang in connection with the Tieshan Oil Exchange.

 

 
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Table of Contents

 

On May 16, 2018, the Company completed its acquisition of Tieshan Oil by entering into a second share exchange agreement (the “Second Tieshan Oil Exchange Agreement”) with Mr. Yang. Pursuant to the Second Tieshan Oil Exchange Agreement, the Company, through Huaxin, agreed to acquire the remaining 49% of Tieshan Oil held by Mr. Yang, in exchange for the issuance to Mr. Yang of 16,000,000 shares of the Company’s Common Stock (the “Tieshan Oil Acquisition”). The Tieshan Oil Acquisition closed simultaneously with the execution of the Second Tieshan Oil Exchange Agreement.

 

Apart from the Tieshan Oil Acquisition, neither the Company nor Huaxin has a material relationship with either Mr. Yang or Tieshan Oil.

 

A description of the products, services, principal market and distribution methods of Tieshan Oil can be found within this Part I, Item 1 under the heading “Principal Products, Services and Their Markets.”

 

Abandonment of Plans to Acquire Dusun Eco Resort (2005) Sdn. Bhd.

 

On December 7, 2017, the Company entered into a Share Exchange Agreement (the “Dusun Exchange Agreement”) with Dusun Eco Resort (2005) Sdn. Bhd., a limited liability company registered under the laws of Malaysia (“Dusun Eco”), and the shareholders of Dusun Eco (the “Dusun Sellers”), by which the Company agreed to acquire all of the issued and outstanding stock of Dusun Eco in exchange for the issuance of 400,000,000 shares of the Company’s Common Stock. After further review of the due diligence materials related to the Exchange, our Board of Directors felt that it was in the Company’s best interest to terminate the Dusun Exchange Agreement. On February 9, 2018, the Company, Dusun Eco and the Dusun Sellers entered into a Termination of Share Exchange Agreement (the “Dusun Termination Agreement”), by which the Company, Dusun Eco and the Dusun Sellers agreed to terminate the Dusun Exchange Agreement with no legal consequence to any of the parties to the Dusun Exchange Agreement.

 

Entry into Share Exchange Agreement with Admall Sdn. Bhd.

 

On February 9, 2018, the Company entered into a Share Exchange Agreement (the “Admall Exchange Agreement”) with Admall Sdn. Bhd., a limited liability company incorporated in Malaysia (“Admall”), and each of Admall’s shareholders (collectively, the “Admall Sellers”), pursuant to which, among other things and subject to the terms and conditions contained therein, the Company will effect an acquisition of Admall by acquiring from the Sellers all outstanding equity interests of Admall in exchange for 400,000,000 shares of Common Stock of the Company (the “Admall Acquisition”). On May 16, 2018, the Company closed the Admall Acquisition.

 

Concurrently with the execution of the Admall Exchange Agreement, our Board of Directors appointed Mr. Boon Jin “Patrick” Tan to be the treasurer, CFO and Director of the Company. Mr. Tan is the founder and director of Admall. Apart from the appointment of Mr. Tan as Director and officer of the Company, and the transactions pursuant to the Admall Exchange Agreement, the Company did not have a prior material relationship with Admall or any of the Admall Sellers.

 

A description of the products, services, principal market and distribution methods of Admall can be found within this Part I, Item 1 under the heading “Principal Products, Services and Their Markets.”

 

Change of Management

 

On February 9, 2018, concurrently with the execution of the Admall Exchange Agreement and the Dusun Termination Agreement, Zhou Gui Bin resigned from his positions as President, CEO, Secretary and Director of the Company, and Zhou Wei resigned from his positions as Treasurer, CFO and Director of the Company. The departing Directors approved, by written consent in lieu of special meeting of the Board of Directors, the appointment of Mr. Ding-Shin “DS” Chang and Mr. Boon Jin “Patrick” Tan as the new Directors of the Company and submitted such appointment for approval and ratification by the Company’s stockholders. The Company’s departing Directors also appointed Mr. Ding-Shin “DS” Chang as the Company’s President and CEO, Mr. Boon Jin “Patrick” Tan as the Company’s Treasurer and CFO, and Mr. Liang-Yu “Jacky” Chang as the Company’s Secretary, all of whom are to serve on an at-will basis until their resignation or removal by the Board of Directors.

 

 
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Table of Contents

 

Change in Fiscal Year End; Change to Bylaws; Reverse Stock Split; Corporate Name Change

 

On July 3, 2018, our Board of Directors approved a change in our fiscal year end from January 31 to December 31. The Company now operates on a fiscal year ending on December 31. The Company changed its bylaws to reflect the change in fiscal year end.

 

Contemporaneously with the change in fiscal year end, our Board of Directors approved a reverse one-for-thirty (1-for-30) stock split (the “Reverse Split”) of the Company’s issued and outstanding Common Stock and a change of corporate name from “Resort Savers, Inc.” to “SCGI Group Holding, Inc.” (the “Name Change”).

 

However, after further consideration of the business needs of the Company, the Board of Directors delayed the implementation of the Reverse Split and Name Change indefinitely.

 

Results of Operations

 

Our operations for the three months ended March 31, 2019 and 2018 are outlined below:

 

Due to reverse acquisition accounting, the Results of operations are not comparable for 2018. Due to acquisition accounting, Admall Sdn. Bhd. (“Admall”) is the accounting acquirer on May 16, 2018 (“acquisition date”), and all operating results prior to May 16, 2018, are those of Admall only. For periods after the acquisition date, results of operations are those of the Company on a consolidated basis.

 

Three months ended March 31, 2019 compared to three months ended March 31, 2018

 

 

 

Three Months Ended

 

 

 

 

 

March 31,

 

 

Change

 

 

 

2019

 

 

2018

 

 

Amount

 

Revenue

 

$ 14,781,045

 

 

$ 211,032

 

 

$ 14,570,013

 

Cost of Goods Sold

 

$ 14,169,390

 

 

$ 156,151

 

 

$ 14,013,239

 

Gross Profit

 

$ 611,655

 

 

$ 54,881

 

 

$ 556,774

 

Operating expenses

 

$ 208,989

 

 

$ 190,603

 

 

$ 18,386

 

Other Income

 

$ 134

 

 

$ 2,071

 

 

$ (1,937 )

Net income (loss)

 

$ 271,489

 

 

$ (112,854 )

 

$ 384,343

 

 

For the three months ended March 31, 2019 and 2018 our results of operations segment, are as follows:

 

Three Months Ended March 31, 2019

 

Holding

Company

 

 

Oil and gas

 

 

Nutritional

Services

 

 

Total

Consolidated

 

Revenue

 

$ -

 

 

$ 14,664,803

 

 

$ 116,242

 

 

$ 14,781,045

 

Cost of goods sold

 

 

-

 

 

 

(14,118,726 )

 

 

(50,664 )

 

 

(14,169,390 )

Operating expenses

 

 

(5,687 )

 

 

(20,834 )

 

 

(182,468 )

 

 

(208,989 )

Other income

 

 

-

 

 

 

-

 

 

 

134

 

 

 

134

 

Provision for income taxes

 

 

-

 

 

 

(131,311 )

 

 

-

 

 

 

(131,311 )

Net income (loss)

 

$ (5,687 )

 

$ 393,932

 

 

$ (116,756 )

 

$ 271,489

 

 

 
6
 
Table of Contents

  

Three Months Ended March 31, 2018

 

Holding

Company

 

 

Oil and gas

 

 

Nutritional

Services

 

 

Total

Consolidated

 

Revenue

 

$ -

 

 

$ -

 

 

$ 211,032

 

 

$ 211,032

 

Cost of goods sold

 

 

-

 

 

 

-

 

 

 

(156,151 )

 

 

(156,151 )

Operating expenses

 

 

-

 

 

 

-

 

 

 

(190,603 )

 

 

(190,603 )

Other income

 

 

-

 

 

 

-

 

 

 

2,071

 

 

 

2,071

 

Provision for income taxes

 

 

-

 

 

 

-

 

 

 

20,797

 

 

 

20,797

 

Net loss

 

$ -

 

 

$ -

 

 

$ (112,854 )

 

$ (112,854 )

 

Liquidity and Capital Resources

 

The following table provides selected financial data about our company as of March 31, 2019 and December 31, 2018, respectively.

 

Working Capital

 

The following table provides selected financial data about our company as of March 31, 2019 and December 31, 2018, respectively.

 

 

 

March 31,

 

 

December 31,

 

 

Change

 

 

 

2019

 

 

2018

 

 

Amount

 

Cash

 

$ 180,522

 

 

$ 257,391

 

 

$ (76,869 )

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Assets

 

$ 16,191,056

 

 

$ 39,865,557

 

 

$ (23,674,501 )

Current Liabilities

 

$ 9,979,282

 

 

$ 34,090,839

 

 

$ (24,111,557 )

Working Capital

 

$ 6,211,774

 

 

$ 5,774,718

 

 

$ 437,056

 

 

The increase in working capital was primarily attributed to a decrease in current liabilities offset by a decrease in current assets.  The decrease in current assets was primarily attributed to a decrease in accounts receivable offset by an increase in inventory. The decrease in current liabilities was primarily attributed to a decrease in accounts payable offset by an increase in accrued liabilities and other payable.

 

Cash Flow

 

 

 

Three Months Ended

 

 

 

 

 

 

March 31,

 

 

Change

 

 

 

2019

 

 

2018

 

 

Amount

 

Cash Flows used in operating activities

 

$ (91,511 )

 

$ (5,025 )

 

$ (86,486 )

Cash Flows provided by (used in) financing activities

 

$ 8,748

 

 

$ (4,071 )

 

$ 12,819

 

Effects on changes in foreign exchange rate

 

$ 5,894

 

 

$ 8,107

 

 

$ (2,211 )

Net change in cash during period

 

$ (76,869 )

 

$ (989 )

 

$ (75,880 )

 

 
7
 
Table of Contents

  

Cash Flow from Operating Activities

 

During the three months ended March 31, 2019, our Company used $91,511 in operating activities, compared to $5,025 during the three months ended March 31, 2018. During the three months ended March 31, 2019, we generated net income of $271,489 and increased by $24,027 in depreciation and we used cash flow of $387,027 from the net change in current assets and liabilities. During the three months ended March 31, 2018, we incurred a net loss of $112,854 of which $27,532 arose from non-cash expenses and we generated cash flow of $80,297 from the net change in current assets and liabilities.

 

Cash Flow from Investing Activities

 

During the three months ended March 31, 2019 and 2018, we did not have any investing activities.

  

Cash Flow from Financing Activities

 

During the three months ended March 31, 2019, our Company received $8,748 in financing activities. For the three months ended March 31, 2019, the Company received $11,237 from loans from related parties and repaid loans from related parties for $2,489.

 

For the three months ended March 31, 2018, our Company used $4,071 for a bank overdraft.

 

Limited Operating History; Need for Additional Capital

 

We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to the price and cost increases in supplies and services.

 

If we are unable to meet our needs for cash from either our operations, or possible alternative sources, then we may be unable to continue, develop, or expand our operations.

 

Critical Accounting Policies and Estimates

 

The preparation of financial statements and related disclosures in conformity with U.S. generally accepted accounting principles and the Company’s discussion and analysis of its financial condition and operating results require the Company’s management to make judgments, assumptions and estimates that affect the amounts reported. Management bases its estimates on historical experience and on various other assumptions it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates, and such differences may be material.

 

Revenue Recognition

 

Revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:

 

 

·

identify the contract with a customer;

 

·

identify the performance obligations in the contract;

 

·

determine the transaction price;

 

·

allocate the transaction price to performance obligations in the contract; and

 

·

recognize revenue as the performance obligation is satisfied.

 

 
8
 
Table of Contents

  

Off-Balance Sheet Arrangements

 

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

 

As a “smaller reporting company,” we are not required to provide the information required by this Item.

 

Item 4. Controls and Procedures

 

Management’s Report on Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our president (our principal executive officer and principal financial officer) to allow for timely decisions regarding required disclosure.

 

As of the end of the quarter covered by this Quarterly Report on Form 10-Q, we carried out an evaluation, under the supervision and with the participation of our president (our principal executive officer, principal financial officer and principle accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Our management’s communication with staff and outside professional advisors is a source of substantial concern and risk, and considering all components of our assessment, our president (our principal executive officer and principal financial officer) concluded that our disclosure controls and procedures were not effective as of the end of the period covered by this Quarterly Report on Form 10-Q.

 

Changes in Internal Controls

 

There have been no changes in our internal controls over financial reporting that occurred during the quarter ended March 31, 2019, that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.

 

 
9
 
Table of Contents

  

PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings

 

We know of no material, existing or pending legal proceedings against our Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

 

Item 1A. Risk Factors

 

As a “smaller reporting company,” we are not required to provide the information required by this Item.

 

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

 

None.

 

Item 3. Defaults Upon Senior Securities

 

None.

 

Item 4. Mine Safety Disclosures

 

Not Applicable.

 

Item 5. Other Information

 

None.

 

 

 
10
 
Table of Contents

  

Item 6. Exhibits

 

Exhibit

Number

 

Description

31.1*

 

Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2*

 

Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1**

 

Certification of the Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2**

 

Certification of the Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS*

 

XBRL Instance Document

101.SCH*

 

XBRL Taxonomy Extension Schema Document

101.CAL*

 

XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF*

 

XBRL Taxonomy Extension Definition Linkbase Document

101.LAB*

 

XBRL Taxonomy Extension Label Linkbase Document

101.PRE*

 

XBRL Taxonomy Extension Presentation Linkbase Document

_________ 

*

Filed herewith.

**

Deemed furnished and not filed.

 

 
11
 
Table of Contents

 

SIGNATURES

 

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

RESORT SAVERS, INC.

 

(Registrant)

 

Dated: June 10, 2019

/s/ DS Chang

 

Ding-Shin “DS” Chang

 

President, Chief Executive Officer and Director

 

(Principal Executive Officer)

 

 

 
12

 

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