ITEM 1. FINANCIAL STATEMENTS
Our unaudited interim financial statements for the three month
period ended March 31, 2018 form part of this quarterly report. They are stated in United States Dollars (US$) and are prepared
in accordance with United States Generally Accepted Accounting Principles.
ORANCO,
INC.
BALANCE SHEETS
MARCH
31, 201
8 AND DECEMBER 31, 2017
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Current Assets:
|
|
|
|
|
|
|
Cash
|
|
$
|
4,023
|
|
|
$
|
70
|
|
Prepaid expenses
|
|
|
25,833
|
|
|
|
3,333
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
29,856
|
|
|
|
3,403
|
|
|
|
|
|
|
|
|
|
|
Total Assets
|
|
$
|
29,856
|
|
|
$
|
3,403
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities:
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
4,200
|
|
|
$
|
665
|
|
Notes payable, stockholder
|
|
|
40,709
|
|
|
|
|
|
Total current liabilities
|
|
|
44,909
|
|
|
|
665
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ Equity:
|
|
|
|
|
|
|
|
|
Common stock, $.001 par value 100,000,000 shares authorized, 42,191,480 and 4,269,950 issued and outstanding
|
|
|
42,192
|
|
|
|
42,192
|
|
Additional paid-in capital
|
|
|
349,898
|
|
|
|
349,898
|
|
Accumulated Deficit
|
|
|
(407,743
|
)
|
|
|
(389,352
|
)
|
|
|
|
|
|
|
|
|
|
Total Stockholders’ Equity
|
|
|
(15,053
|
)
|
|
|
2,738
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities and Stockholders’ Equity
|
|
$
|
29,856
|
|
|
$
|
3,403
|
|
The accompanying notes are an integral
part of these financial statements.
ORANCO, INC.
STATEMENTS
OF OPERATIONS
FOR
THE THREE MONTH
S ENDED
MARCH
31, 201
8
AND 201
7
(unaudited)
|
|
Three
Months Ended March 31,
2018
|
|
|
Three
Months Ended March 31,
2017
|
|
Revenues
|
|
$
|
--
|
|
|
$
|
--
|
|
|
|
|
|
|
|
|
|
|
Expenses,
general and administrative
|
|
|
18,391
|
|
|
|
2,514
|
|
|
|
|
|
|
|
|
|
|
Operating loss
|
|
|
(18,391
|
)
|
|
|
(2,514
|
)
|
|
|
|
|
|
|
|
|
|
Other income (expense):
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
--
|
|
|
|
--
|
|
Interest
expense
|
|
|
--
|
|
|
|
(100
|
)
|
|
|
|
|
|
|
|
|
|
Loss before provision
for income taxes
|
|
|
(18,391
|
)
|
|
|
(2,614
|
)
|
|
|
|
|
|
|
|
|
|
Provision
for income taxes
|
|
|
--
|
|
|
|
--
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(18,391
|
)
|
|
$
|
(2,614
|
)
|
|
|
|
|
|
|
|
|
|
Net loss per share
|
|
$
|
--
|
|
|
$
|
--
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
|
|
|
|
|
|
|
|
|
Outstanding
|
|
|
42,191,480
|
|
|
|
4,269,950
|
|
The accompanying notes are an integral
part of these financial statements.
ORANCO, INC.
STATEMENTS
OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31,
2018 AND 2017
(unaudited)
|
|
Three Months
Ended
|
|
|
Three Months
Ended
|
|
|
|
March 31,
2018
|
|
|
March 31,
2017
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
Net loss for the period
|
|
$
|
(18,391
|
)
|
|
$
|
(2,614
|
)
|
|
|
|
|
|
|
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
Expenses paid directly by stockholder
|
|
|
600
|
|
|
|
|
|
(Increase)/decrease in prepaid expenses
|
|
|
(22,500
|
)
|
|
|
2,500
|
|
Increase in accounts payable
|
|
|
3,535
|
|
|
|
--
|
|
Increase in interest payable
|
|
|
--
|
|
|
|
100
|
|
|
|
|
|
|
|
|
|
|
Net cash used in operating activities:
|
|
|
(36,756
|
)
|
|
|
(14
|
)
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
--
|
|
|
|
--
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
Proceeds from stockholder loan
|
|
|
40,709
|
|
|
|
--
|
|
|
|
|
|
|
|
|
|
|
Net increase/(decrease) in cash and cash equivalents
|
|
|
3,953
|
|
|
|
(14
|
)
|
Cash and cash equivalents, beginning of period
|
|
|
70
|
|
|
|
3,234
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period
|
|
$
|
4,023
|
|
|
$
|
3,220
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid for interest
|
|
$
|
--
|
|
|
$
|
--
|
|
|
|
|
|
|
|
|
|
|
Cash paid for income taxes
|
|
$
|
--
|
|
|
$
|
--
|
|
The accompanying notes are an integral
part of these financial statements.
ORANCO, INC.
NOTES TO FINANCIAL STATEMENTS
|
1.
|
Summary of Business and Significant Accounting Policies
|
The Company was incorporated
under the laws of the State of Nevada on June 16, 1977. The Company has been in the business of the development of mineral deposits.
During 1983 all activities were abandoned and the Company has remained inactive since that time. The Company has not commenced
principal operations. The Company is looking to pursue business opportunities.
The accompanying financial statements have been
prepared in accordance with generally accepted accounting principles (“GAAP”) as promulgated in the United States of
America.
For purposes of the statement of cash flows,
the Company considers all highly liquid investments purchased with a maturity of three months or less to be cash or cash equivalents.
The net loss per share calculation is based on the
weighted average number of shares outstanding during the period.
The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported
amounts and disclosures. Accordingly, actual results could differ from those estimates.
|
f.
|
Fair Value of Financial Instruments
|
ASC 820-10 requires entities
to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized on the balance sheet,
for which it is practicable to estimate fair value. ASC 820-10 defines the fair value of a financial instrument as the amount at
which the instrument could be exchanged in a current transaction between willing parties. As of March 31, 2018 and December 31,
2017, the carrying value of certain financial instruments approximates fair value due to the short-term nature of such instruments.
|
g.
|
Risks and Uncertainties
|
The Company's operations
are subject to significant risk and uncertainties including financial, operational, technological, and regulatory risks including
the potential risk of business failure. See Note 2 regarding going concern matters.
|
h.
|
Cash and Cash Equivalents
|
For purposes of the statement
of cash flows, the Company considers all highly liquid investments with maturities of three months or less to be cash equivalents.
|
i.
|
Fair Value of Financial Instruments
|
ASC
820-10 requires entities to disclose the fair value of financial instruments, both assets and liabilities recognized and not recognized
on the balance sheet, for which it is practicable to estimate fair value. ASC 820-10 defines the fair value of a financial instrument
as the amount at which the instrument could be exchanged in a current transaction between willing parties. As of March 31, 2018
and December 31, 2017, the carrying value of certain financial instruments approximates fair value due to the short-term nature
of such instruments.
|
2.
|
Notes Payable, Stockholder
|
Stockholder notes payable consist
of the following at March 31, 2018 and December 31, 2017:
|
|
|
March 31,
2018
|
|
|
December 31,
2017
|
|
|
Notes payable to an individual also a stockholder and director of the Company, interest is being charged at -0-%, the note is unsecured and payable on demand.
|
|
$
|
40,709
|
|
|
$
|
--
|
|
|
3.
|
Warrants and Stock Options
|
No options or warrants are outstanding
to acquire the Company's common stock.
The Company has had no taxable
income under Federal or State tax laws. The Company has loss carryforwards totaling $389,352 that may be offset against future
federal income taxes. If not used, the carryforwards will expire 20 years after they are incurred. Due to the Company being in
the development stage and incurring net operating losses, a valuation allowance has been provided to reduce the deferred tax assets
from the net operating losses to zero. Therefore, there are no tax benefits recognized in the accompanying statement of operations.
As shown in the accompanying
financial statements, the Company incurred a net loss of $18,391 during the three months ended March 31, 2018 and accumulated losses
of $407,743 since inception at June 15, 1977. The Company’s current liabilities exceed its current assets by $15,053 at March
31, 2018. These factors create an uncertainty as to the Company’s ability to continue as a going concern. The ability of
the Company to continue as a going concern is dependent upon the success of raising additional capital through the issuance of
common stock and the ability to generate sufficient operating revenue. The financial statements do not include any adjustments
that might be necessary should the Company be unable to continue as a going concern.
|
6.
|
Subsequent Events - Date of Management Evaluation
|
Management has evaluated events subsequent to the
date on which the financial statements were available to be issued.
ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATION
The following discussion and analysis
of financial condition and results of operations relates to the operations and financial condition reported in the unaudited condensed
consolidated financial statements of the Company for the three months ended March 31, 2018 and 2017, and should be read in conjunction
with such financial statements and related notes included in this report. Except for the historical information contained herein,
the following discussion, as well as other information in this report, contain “forward-looking statements,” within
the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, and are subject to the “safe harbor” created by those sections. 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 “Forward-Looking Statements” set forth elsewhere in this Quarterly Report on Form 10-Q.
Overview
Oranco, Inc., or the Company, was incorporated
under the laws of the State of Nevada, on June 10, 1977. The purposes for which the corporation was organized were: (1) to engage
in any lawful business from time to time authorized by the board of directors, (2) to act as principal, agent, partner or joint
venturer or in any other capacity in any transaction, (3) to do business anywhere in the world, and (4) to have and exercise all
rights and powers from time to time granted to the corporation by law.
From 1977 until 1981 the Company was dormant
and undertook no activities. Beginning in 1982 the Company explored the option of entering into a joint venture to develop a mercury
mining property at Mercury Mountain, Nevada. As a part of these activities the Company, through the sale of its common stock, raised
funds to engage the services of an independent mining engineer to prepare a report on the feasibility of the project. By late 1983
it had been determined that the project did not warrant any further investment. From that time until 1997 the Company's activities
concentrated on maintaining its corporate existence and looking for other opportunities for the Company. In May of 1997 new management
was appointed, a shareholders' meeting was held, amendments to the Company's articles of incorporation were approved, and additional
effort was made by new management to make the Company a viable merger candidate. These efforts included engaging the services of
a certified Public Accounting firm to audit the Company's financial statements, obtaining an Opinion of Counsel as to the tradability
of the Company's outstanding shares, preparation of the information required by Rule 15c2-11, and applying to the OTC Bulletin
Board for trading on the medium.
By September of 1999, no viable acquisitions
or merger candidates had been located for the Company and management became aware that the Company would be required to register
its shares under the Securities Exchange Act of 1934 in order to maintain its stock on the OTC Bulletin Board. Management determined
that the Company needed new management which might be better positioned to find a suitable acquisition or merger candidate and
which would be in a position of funding the upcoming expenses of the Company. On September 1, 1999 management of the Company resigned
and Claudio Gianascio was appointed as sole director and officer. On November 9, 1999 the Company sold 700,000 of its shares of
common stock to Mr. Gianascio for $.05 per share, netting a total of $35,000. On November 18, 1999 the Company filed a registration
statement on Form 10SB which became effective sixty days thereafter.
The Company had an initial authorized capital
of $25,000 consisting of 100,000 shares of $.25 par value common stock. On June 10, 1997 the shareholders approved an amendment
to the Articles of Incorporation of The Company changing the authorized capital to 100,000,000 shares at a par value of $.001 and
providing for a 10 to 1 share forward split of the outstanding shares. The Articles of Amendment were filed with the State of Nevada
on August 6, 1998.
In the summer of 2000, the Company completed
a private placement of 2,500,000 units for which it received $250,000. Each unit consisted of one share of common stock; one “a”
warrant giving the holder thereof the right to purchase, upon a minimum of 60 days prior notice of exercise, one share of common
stock at $.10 per share within two years of the date of issuance; and one “b” warrant giving the holder thereof the
right to purchase, upon a minimum of 60 days prior notice of exercise, one share of common stock at $.25 per share within two years
of the date of issuance. Both “a” & “b” warrants expired without exercise.
On December 26, 2017, Million Success Business
Limited, a British Virgin Islands corporation (“Buyer”) entered into a Share Purchase Agreement (“Purchase Agreement”)
with the then largest shareholder of the Company, Mr. Claudio Gianascio, who owned 90.4% of the total outstanding shares of the
Company (“Seller”). Pursuant to the terms of the Purchase Agreement, the Seller sold to the Buyer all of his shares of
common stock of the Company, par value $0.001 per share (the “Common Stock”), or 38,121,530 shares of the Common Stock
for $340,000 (such transaction, the “Share Purchase”). The Share Purchase closed on December 29, 2017.
At the closing of the Share Purchase, there
was a change in our board and executive officers. Mr. Claudio Gianascio, sole director, President, Treasurer and Secretary of the
Company appointed Mr. Peng Yang to serve as sole director, President, Treasurer and Secretary of the Company, with such appointment
effective on January 5, 2018, being ten days from the date the Information Statement on Schedule 14F-1 (the “Schedule 14F-1”)
reporting the change in control as a result of the Share Purchase was mailed to all the stockholders of the Company. Mr. Gianascio
resigned from all his positions with the Company effective on January 5, 2018.
The Company did not generate any revenue
during the three months ended March 31, 2018 and 2017.
General and administrative expenses were
$18,391 and $2,514 for the three months ended March 31, 2018 and 2017. The increase in expenses for the three months ended March
31, 2018 were largely due to increased professional fees and office expense. As a result of the foregoing, the Company realized
net losses of $18,391 and $2,614 for the three months ended March 31, 2018 and 2017. The Company's increased net loss is attributable
to increased professional fees and office expense.
At March 31, 2018, assets consisted of
$4,023 in cash and $25,833 in prepaid expenses compared to $70 in cash and $3,333 in prepaid expenses on December 31, 2017. As
of March 31, 2018, the Company had $4,200 in accounts payable and $40,709 in notes payable to stockholder.
Currently, the Company has no material
commitments for capital expenditures. Management understands that it does not have sufficient cash to meet its immediate operational
needs and will require additional capital to cover ongoing operating expenses. Management may attempt to raise additional capital
for its current operational needs through loans from its officers or shareholders, debt financing, equity financing or a combination
of financing options. However, there are no existing understandings, commitments or agreements for such an infusion; nor can there
be assurances to that effect.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Control 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,
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, principal financial officer and principle accounting officer) to allow for timely decisions regarding required
disclosure.
As of the end
of the quarter covered by this report, 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. Based on the foregoing, our president (our principal executive officer,
principal financial officer and principle accounting officer) concluded that our disclosure controls and procedures were effective
as of the end of the period covered by this quarterly report.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal
control over financial reporting during the three months ended March 31, 2018, that have materially affected, or are reasonably
likely to materially affect, our internal control over financial reporting.