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 September 30,
2014
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 333-188152
MJP INTERNATIONAL LTD.
(Exact name of registrant as specified in its charter)
Nevada |
N/A |
(State or other jurisdiction of incorporation or
organization) |
(IRS Employer Identification No.) |
|
|
2806, 505 - 6th Street SW, Calgary, Alberta, Canada
|
T2P 1X5 |
(Address of principal executive offices) |
(Zip Code) |
(403) 237 8330
(Registrants
telephone number, including area code)
N/A
(Former name, former address and
former fiscal year, if changed since last report)
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 [ ] NO
Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such
files).
[X] YES [ ] NO
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer, or a small
reporting company. See the definitions of large accelerated filer,
accelerated filer and smaller reporting company in Rule 12b-2 of the
Exchange Act.
Large accelerated filer [ ] |
|
Accelerated
filer
[ ] |
Non-accelerated filer [ ] |
(Do not check if a smaller
reporting company) |
Smaller reporting company [X]
|
Indicate by check mark whether the registrant is a shell
company (as defined in Rule 12b-2 of the Exchange Act)
[ ]
YES [X] NO
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act
after the distribution of securities under a plan confirmed by a court.
[ ] YES [ ] NO
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the
issuers classes of common stock, as of the latest practicable date.
16,108,500 common shares issued and outstanding as of
November 7, 2014.
TABLE OF CONTENTS
2
PART I - FINANCIAL INFORMATION
Item
1. Financial
Statements
Our unaudited condensed interim consolidated financial
statements for the three month period ended September 30, 2014 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.
3
MJP International Ltd.
CONDENSED INTERIM CONSOLIDATED BALANCE SHEETS
Stated
in US Dollars
(A Development Stage Company)
|
|
September 30, |
|
|
June 30, |
|
|
|
2014 |
|
|
2014 |
|
|
|
(Unaudited) |
|
|
(Audited) |
|
ASSETS |
|
Current |
|
|
|
|
|
|
Cash and cash
equivalents |
$ |
1,707 |
|
$ |
967 |
|
Total Assets |
$ |
1,707 |
|
$ |
967 |
|
|
|
|
|
|
|
|
LIABILITIES |
|
Current |
|
|
|
|
|
|
Trades and other payables |
$ |
22,369 |
|
$ |
17,847 |
|
Due to related
parties (Note 3) |
|
68,536 |
|
|
66,035 |
|
Total Liabilities |
|
90,905 |
|
|
83,882 |
|
|
|
|
|
|
|
|
STOCKHOLDERS' DEFICIENCY |
|
Capital Stock |
|
|
|
|
|
|
Authorized
100,000,000
common stock, voting, par value $0.0001
each 90,000,000
preferred stock, non-voting, par value $0.0001
each Issued 16,108,500
(June 30, 2014 - 16,108,500) common stock (Note 4) |
|
1,611 |
|
|
1,611 |
|
Additional paid in capital (Note 4) |
|
112,195 |
|
|
112,195 |
|
Deficit accumulated during the development stage |
|
(204,090 |
) |
|
(193,568 |
) |
Accumulated other comprehensive loss |
|
1,086 |
|
|
(3,153 |
)
|
Total Stockholders' Deficiency |
|
(89,198 |
) |
|
(82,915 |
) |
Total Liabilities and Stockholders' Equity |
$ |
1,707 |
|
$ |
967 |
|
|
|
|
|
|
|
|
Going Concern (Note 1) |
|
|
|
|
|
|
The accompanying
notes are an integral part of these condensed interim consolidated
financial statements |
F-1 |
MJP International Ltd.
CONDENSED INTERIM CONSOLIDATED STATEMENT OF OPERATIONS
Stated in US Dollars
(A Development Stage Company)
For the three
months ended September 30, 2014 and 2013;
and the period from inception (July
19, 2010) to September 30, 2014
(Unaudited)
|
|
Three months |
|
|
Three months |
|
|
|
|
|
|
ended |
|
|
ended |
|
|
Since July 19, 2010 |
|
|
|
September 30, |
|
|
September 30, |
|
|
to September 30, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
|
|
|
|
|
|
|
|
|
Revenue |
$ |
2,015 |
|
$ |
2,749 |
|
$ |
96,864 |
|
|
|
|
|
|
|
|
|
|
|
Cost of goods sold |
|
(1,632 |
) |
|
(1,149 |
) |
|
(74,514 |
) |
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
383 |
|
|
1,600 |
|
|
22,350 |
|
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General &
administration |
|
8,054 |
|
|
13,061 |
|
|
100,094 |
|
Professional fees |
|
- |
|
|
792 |
|
|
66,591 |
|
Wages &
salaries |
|
2,851 |
|
|
2,983 |
|
|
58,420 |
|
|
|
(10,905 |
) |
|
(16,836 |
) |
|
(225,105 |
) |
|
|
|
|
|
|
|
|
|
|
Net loss before income tax |
|
(10,522 |
) |
|
(15,236 |
) |
|
(202,755 |
) |
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
- |
|
|
- |
|
|
1,335 |
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
(10,522 |
) |
|
(15,236 |
) |
|
(204,090 |
) |
|
|
|
|
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
Foreign currency
adjustment |
|
4,239 |
|
|
5 |
|
|
86 |
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss |
$ |
(6,283 |
) |
$ |
(15,231 |
) |
$ |
(204,004 |
) |
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss per stock |
$ |
(0.001 |
) |
$ |
(0.001 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares
outstanding |
|
16,108,500 |
|
|
16,108,500 |
|
|
|
|
The accompanying
notes are an integral part of these condensed interim consolidated
financial statements |
F-2 |
MJP International Ltd.
CONDENSED INTERIM
CONSOLIDATED STATEMENT OF
STOCKHOLDERS EQUITY
Stated in US Dollars
(A Development Stage Company)
|
|
Common Stock |
|
|
|
|
|
Accumulated Other |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional Paid |
|
|
Comprehensive |
|
|
|
|
|
|
|
|
|
Shares |
|
|
Amount |
|
|
in Capital |
|
|
Income (Loss) |
|
|
Deficit |
|
|
Total |
|
Balance, July 19, 2010 |
|
12,000,000 |
|
$ |
1,200 |
|
$ |
(1,096 |
) |
$ |
- |
|
$ |
- |
|
$ |
104 |
|
Net loss for the period |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(17,693 |
) |
|
(17,693 |
) |
Other comprehensive loss for the period |
|
- |
|
|
- |
|
|
- |
|
|
(684 |
) |
|
- |
|
|
(684 |
) |
Balance, June 30, 2011 |
|
12,000,000 |
|
$ |
1,200 |
|
$ |
(1,096 |
) |
$ |
(684 |
) |
$ |
(17,693 |
) |
$ |
(18,273 |
) |
Net income for the year |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
2,863 |
|
|
2,863 |
|
Other comprehensive income for the year |
|
- |
|
|
- |
|
|
- |
|
|
936 |
|
|
- |
|
|
936 |
|
Balance, June 30, 2012 |
|
12,000,000 |
|
$ |
1,200 |
|
$ |
(1,096 |
) |
$ |
252 |
|
$ |
(14,830 |
) |
$ |
(14,474 |
) |
Recapitalization |
|
150,000 |
|
|
15 |
|
|
(6,992 |
) |
|
- |
|
|
- |
|
|
(6,977 |
) |
Stock issued for private placement |
|
3,958,500 |
|
|
396 |
|
|
120,283 |
|
|
- |
|
|
- |
|
|
120,679 |
|
Net loss for the year |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(87,533 |
) |
|
(87,533 |
) |
Other comprehensive loss for the year |
|
- |
|
|
- |
|
|
- |
|
|
(3,048 |
) |
|
- |
|
|
(3,048 |
) |
Balance, June 30, 2013 |
|
16,108,500 |
|
$ |
1,611 |
|
$ |
112,195 |
|
$ |
(2,796 |
) |
$ |
(102,363 |
) |
$ |
8,647 |
|
Net loss for the period |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(91,205 |
) |
|
(91,205 |
) |
Other comprehensive loss for the period |
|
- |
|
|
- |
|
|
- |
|
|
(357 |
) |
|
- |
|
|
(357 |
) |
Balance, June 30, 2014 |
|
16,108,500 |
|
$ |
1,611 |
|
$ |
112,195 |
|
$ |
(3,153 |
) |
$ |
(193,568 |
) |
$ |
(82,915 |
) |
Net loss for the period |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(10,522 |
) |
|
(10,522 |
) |
Other
comprehensive income for the period |
|
- |
|
|
- |
|
|
- |
|
|
4,239 |
|
|
- |
|
|
4,239 |
|
Balance, September 30, 2014 |
|
16,108,500 |
|
$ |
1,611 |
|
$ |
112,195 |
|
$ |
1,086 |
|
$ |
(204,090 |
) |
$ |
(89,198 |
) |
The accompanying
notes are an integral part of these condensed interim consolidated
financial statements |
F-3 |
MJP International Ltd.
CONDENSED INTERIM CONSOLIDATED STATEMENT OF OPERATIONS
Stated in US Dollars
(A Development Stage Company)
For the three
months ended September, 2014 and 2013;
and the period from inception (July
19, 2010) to September 30, 2014
(Unaudited)
|
|
Three months |
|
|
Three months |
|
|
Since July 19, |
|
|
|
ended |
|
|
ended |
|
|
2010 to |
|
|
|
September 30, |
|
|
September 30, |
|
|
September 30, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
Operating activities |
|
|
|
|
|
|
|
|
|
Net loss
for the period |
$ |
(10,522 |
) |
$ |
(15,236 |
) |
$ |
(204,090 |
) |
Changes in non-cash
working capital: |
|
|
|
|
|
|
|
|
|
Trades receivable |
|
- |
|
|
(1,021 |
) |
|
- |
|
Prepaid expenses |
|
- |
|
|
(1,458 |
) |
|
- |
|
Inventory |
|
- |
|
|
(185 |
) |
|
- |
|
Trade and other payables |
|
4,522 |
|
|
(6,734 |
) |
|
22,987 |
|
Due to related parties |
|
2,501 |
|
|
(2,914 |
) |
|
68,536 |
|
|
|
|
|
|
|
|
|
|
|
Net cash
used in operating activities |
|
(3,499 |
) |
|
(27,548 |
) |
|
(112,567 |
) |
|
|
|
|
|
|
|
|
|
|
Financing activities |
|
|
|
|
|
|
|
|
|
Cash from acquisition |
|
- |
|
|
- |
|
|
382 |
|
Common
stock issued |
|
- |
|
|
- |
|
|
113,806 |
|
|
|
|
|
|
|
|
|
|
|
Net cash
provided by financing activities |
|
- |
|
|
- |
|
|
114,188 |
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash |
|
4,239 |
|
|
5 |
|
|
86 |
|
|
|
|
|
|
|
|
|
|
|
Net cash increase (decrease)
for period |
|
740 |
|
|
(27,543 |
) |
|
1,707 |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents,
beginning of the period |
|
967 |
|
|
57,677 |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents,
end of the period |
$ |
1,707 |
|
$ |
30,134 |
|
$ |
1,707 |
|
The accompanying
notes are an integral part of these condensed interim consolidated
financial statements |
F-4 |
MJP International Ltd.
CONDENSED INTERIM CONSOLIDATED STATEMENT OF OPERATIONS
Stated in US Dollars
(A Development Stage Company)
For the three
months ended September, 2014 and 2013;
and the period from inception (July
19, 2010) to September 30, 2014
(Unaudited)
NOTE 1 NATURE AND CONTINUANCE OF OPERATIONS
MJP International Ltd. (MJP or the Corporation) was
incorporated in the state of Nevada, United States on October 24, 2012. On
December 10, 2012, the Corporation acquired MJP Lighting Solutions Ltd. (MJP
BVI) and MJP BVIs wholly owned subsidiary, MJP Holdings Ltd. (MJP Alberta)
by issuing 12,000,000 common stock in exchange for 100 percent of the
outstanding common stock of MJP BVI (the Transaction).
MJP BVI, a British Virgin Islands company, with its main office
located in Hong Kong, was incorporated on October 31, 2012. MJP Alberta was
incorporated on July 19, 2010 under the laws of the province of Alberta, Canada.
MJP BVI operating through MJP Alberta specializes in the sale and distribution
of LED lighting and technology solutions and is focused on the North American
market. MJP Alberta has set up an agency in Guangzhou, China in search of high
quality products offered by reputable manufacturers to be introduced to Canada.
These interim consolidated financial statements have been
prepared in accordance with generally accepted accounting principles applicable
to a going concern, which assumes that the Corporation and its subsidiaries will
be able to meet its obligations and continue its operations for next fiscal
year. Realization values may be substantially different from carrying values as
shown and these interim consolidated financial statements do not give effect to
adjustments that would be necessary to the carrying values and classification of
assets and liabilities should the Corporation be unable to continue as a going
concern. At September 30, 2014, the Corporation had not yet achieved profitable
operations and has accumulated losses of $204,090 since its inception. The
Corporation expects to incur further losses in the development of its business,
all of which casts substantial doubt about the Corporations ability to continue
as a going concern. The Corporations ability to continue as a going concern is
dependent upon its ability to generate future profitable operations and/or to
obtain the necessary financing to meet its obligations and repay its liabilities
arising from normal business operations when they come due. Management
anticipates that additional funding will be in the form of equity financing from
the sale of common stock. Management may also seek to obtain short-term loans
from the directors of the Corporation. There are no current arrangements in
place for equity funding or short-term loans.
NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
This summary of significant accounting policies is presented to
assist in understanding the interim consolidated financial statements. The
interim consolidated financial statements and notes are the representations of
the Corporations management, who is responsible for their integrity and
objectivity. The interim consolidated financial statements have been prepared in
accordance with the instructions to Form 10-Q, and therefore do not include all
the information necessary for a fair presentation of financial position, results
of operations and cash flows in conformity with generally accepted accounting
principles. These interim consolidated financial statements should be read in
conjunction with the annual consolidated financial statements and footnotes
thereto included in the Corporations filed Form 10-K.
MJP International Ltd.
CONDENSED INTERIM CONSOLIDATED STATEMENT OF OPERATIONS
Stated in US Dollars
(A Development Stage Company)
For the three
months ended September, 2014 and 2013;
and the period from inception (July
19, 2010) to September 30, 2014
(Unaudited)
NOTE 2 SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (continued)
Basis of Presentation
The Corporations interim consolidated financial statements
included herein are prepared under the accrual basis of accounting in accordance
with accounting principles generally accepted in the United States of America.
These interim consolidated financial statements include the Corporations wholly
owned subsidiaries MJP Lighting Solutions Ltd. and MJP Holdings Ltd. and 100
percent of their assets, liabilities and net income or loss. All inter-company
accounts and transactions have been eliminated.
While the information presented in the accompanying interim
three months consolidated financial statements is unaudited, it includes all
adjustments, which are, in the opinion of management, necessary to present
fairly the financial position, results of operation and cash flows for the
interim periods presented. All adjustments are of a normal recurring nature.
Operating results for the period ended September 30, 2014 are not necessarily
indicative of the results that can be expected for the year ended June 30,
2015.
New Accounting Pronouncements
In May 2014, the Financial Accounting Standards Board issued
Accounting Standards Update (ASU) 2014-9,
Revenue from Contracts with Customers: Topic 606 (ASU
2014-9). ASU 2014-9 is intended to enhance comparability of revenue recognition
practices across entities, industries, jurisdictions, and capital markets,
improve disclosure to help users of financial statements better understand the
nature, amount, timing, and uncertainty of revenue that is recognized, and
provide guidance for transactions that are not currently addressed
comprehensively. The standard is effective for fiscal years beginning after
December 15, 2016, and interim periods therein, and does not allow for early
adoption. Entities have the option of using either a full retrospective or
modified retrospective approach for the adoption of the standard. The
Corporation has begun the evaluation of the impact that the standard will have
on its consolidated financial statements but has not yet selected a transition
method.
NOTE 3 DUE TO RELATED PARTIES
During the period ended September 30, 2014, the Corporation
incurred wages and related expense of $2,851 (September 30, 2013 - $2,983) to an
officer and shareholder of the Corporation. Of this amount, $2,851 (June 30,
2013 - $2,983) is included in trade and other payables.
As at September 30, 2014 the Corporation was obligated to
shareholders for funds advanced to the Corporation for working capital. The
advances are unsecured and no interest rate or payback schedule has been
established.
NOTE 4 CAPITAL STOCK
As at September 30, 2014, there were no warrants or options
outstanding (2013 - $nil).
Item
2. Managements
Discussion and Analysis of Financial Condition and Results of Operations
FORWARD-LOOKING STATEMENTS
This quarterly report on Form 10-Q contains forward-looking
statements that involve risks and uncertainties. These statements relate to
future events or our future financial performance. In some cases, you can
identify forward-looking statements by terminology including could, may,
will, should, expect, plan, anticipate, believe, estimate,
predict, potential and the negative of these terms or other comparable
terminology. These statements are only predictions. Actual events or results may
differ materially.
While these forward-looking statements, and any assumptions
upon which they are based, are made in good faith and reflect our current
judgment regarding the direction of our business, actual results will almost
always vary, sometimes materially, from any estimates, predictions, projections,
assumptions or other future performance suggested in this report.
In this quarterly report, unless otherwise specified, all
dollar amounts are expressed in United States dollars. All references common
shares refer to the common shares in our capital stock.
As used in this quarterly report, the terms we, us, our
and our company, mean MJP International Ltd. and our wholly owned
subsidiaries, MJP Lightings Solutions Ltd., a British Virgin Islands corporation
and MJP Holdings Ltd., an Alberta, Canada corporation.
General Overview
Our company was incorporated in the State of Nevada on October
24, 2012. We are a development stage company; having entered into the
development stage on October 24, 2012. Founded in Calgary, Canada, we aim to
capitalize on new opportunities found in the North American market for
light-emitting diode (LED) lighting. With China as the manufacturing backbone
of future LED products, we have set up office in Guangzhou, China in search of
high quality products offered by reputable manufacturers to be introduced to
Canada, the United States, and abroad. Our president, chief executive officer
and director, Chris Tong Tang spends more than 50% of his time in the Southern
China region, including Guangzhou and Hong Kong. While there, he operates from
our Guangzhou office. In addition to seeing suppliers and sourcing and
inspecting products at factories, he is also actively seeking to develop a
market for our products in that region.
Our executive offices are located at Suite 2806, 505 - 6th
Street SW, Calgary, Alberta, Canada T2P 1X5. Our telephone number is (403) 237
8330.
Current Business
On December 10, 2012, we entered into a share exchange
agreement with MJP Lighting Solutions Ltd. and the shareholders of MJP Lighting
Solutions pursuant to which we acquired MJP Lighting Solutions and MJP Holdings
Ltd., as our wholly owned subsidiaries. As a result of the acquisition, we
issued 12,000,000 shares of common stock in exchange for 100% of the outstanding
common shares of MJP Lighting Solutions and MJP Holdings.
MJP Lighting Solutions, a British Virgin Islands company, with
its main office located in Hong Kong, was incorporated in October 31, 2012. MJP
Lighting Solutions operated through its then wholly owned subsidiary, MJP
Holdings, of Alberta, Canada. MJP Holdings was incorporated on July 19, 2010
under the laws of the province of Alberta, Canada. MJP Holdings specializes in
the sale and distribution of LED lighting and technology solutions.
5
On January 1, 2012 we received a letter of authorization from
Gysun Opto-Electronic Co. Ltd. pursuant to which we were designated as an
authorized dealer in Canada for all LED products produced by Gysun
Opto-Electronic. The letter of authorization entitles us to market and
distribute products of Gysun Opto-Electronic in Canada. All purchase orders made
by us are negotiated and determined on a case by case basis. The letter of
authorization has no fixed term and is valid until revoked.
Products and Services
Light-Emitting Diodes (LEDs)
Light-emitting diode, commonly known as LED, is a solid-state
semiconductor technology that is rapidly gaining momentum in the lighting
industry. Early market for LEDs was driven by specific niche markets, mainly
backlighting, that optimized on the products coloured light and small package
size. From backlighting, the product slowly made inroads into the automotive
industry. Today, the focus of the industry has largely been shifted towards
general lighting. LED applications are evolving quickly into viable sources for
general illumination as they promise many benefits over conventional lighting.
Within the past few years, LED technology has improved significantly with
respect to brightness, energy efficiency, and colour quality and consistency.
Branded as a disruptive technology, LED has played a tremendous role in
revolutionizing the lighting industry. LEDs have the following attributes:
- Efficiency. LEDs have exceptionally high theoretical energy
efficiency. They can produce much higher lumen per watt than conventional
technologies, thus providing energy savings up to 50 to 70%.
- Lifespan. The materials used in making LEDs are inherently stable.
High quality LEDs may last for 50,000 to 100,000 hours or more. Unlike
conventional lighting technologies, lifespan of an LED is unaffected by rapid
cycling, its lifespan actually increases when the average current flowing
through it is reduced.
- Controllability. LEDs have superior control over light colour,
intensity, and direction. Newer white LEDs bring the potential to illuminate
public spaces, homes and offices with light that mimics daylight. The
controllability of LED- generated light enables intelligent light systems,
making them better suited to smart controls than any previous light
technology.
- Durability. LEDs are extremely durable; and are resistant to
vibration, mechanical stress, and extreme weather conditions whereby
conventional lighting solutions are at a disadvantage.
- Environmentally Friendly. LEDs do not contain toxic materials such
as mercury, a necessary component of fluorescent bulbs.
Todays LEDs boast many benefits over conventional
technologies. In addition to the many objective advantages mentioned above, they
also provide social benefits that play an important role in enhancing human
emotions, motivation, abilities, health, and perception of public safety.
MJP Internationals LED Products
Through our Canadian subsidiary, MJP Holdings, we currently
sell LED products in Canada primarily to retail clients (end users) or through
agents. To date, the majority of our products sold in Canada have been sold
through two independent agents, ECCOS Lifestyle Ltd. and PSL Enterprises Ltd.,
both of Calgary, Alberta. In June, 2013, through our wholly owned British Virgin
Island subsidiary, MJP Lighting Solutions, we made a sale to an end user in Hong
Kong. Our company has established relationships with and has purchased most of
our products from two suppliers in Southern China, Gysun Opto-Electronic Co.
Ltd. and Odin Optoelectronics Technology Co., Limited. To date, our sales have
consisted primarily of LED tube lights, LED PAR (parabolic aluminized reflector)
lamps for spot lights, and LED down lights. These products are certified for
sale in North America with UL® (Underwriters Laboratories) or CSA® (Canadian
Standards Association). All of these products have numerous applications in both
commercial and residential structures and offer a number of benefits over both
incandescent and fluorescent lighting products.
6
PAR Series
The LED PAR Series bulb is a replacement bulb for traditional
PAR 30/38 lamps, where typically halogen bulbs are used. Diameter and length are
identical to traditional lighting products; however, the mid-section is wider to
allow necessary thermal management. Normally this difference is accommodated by
the standard fixtures. The LED bulb is available with either a spot or wide beam
lens and can be used in recessed, track and pendant lighting. Traditionally, the
PAR light series has two product alternatives: halogen lamps and compact
fluorescent lamps (CFLs). LED PAR Series are superior in many ways over these
two product alternatives. Both the halogen and CFL bulbs operate at higher
wattages resulting in higher yearly power consumption and heat emissions.
Furthermore, halogen and CFL lighting products are also deficient in luminosity
(light intensity) and longevity.
Down Light
The LED Down Light series is a complete lighting fixture with
bulb and installation housing. The model has three variations: recessed, narrow
spot, and wide beam; allowing for a wide range of applications. The LED Down
Light series lack of heat output and spot capabilities make this product ideal
for display lighting. However the fixtures can also be used in any commercial
office space or residential dwelling.
The Down Light series bulb is superior in many ways over the
halogen and CFL lighting products. However, a feature that truly sets the LED
Down Light product apart from its alternatives is that the bulb is available in
both a wide and narrow beam model; allowing the product a greater amount of
versatility over alternative lighting products.
Tube Series
The LED Tube series products are designed to replace
fluorescent lamps and fit into existing light fixtures. The new LED lighting
products are easy to install and require only some minor wiring adjustments,
which includes removing the now obsolete ballasts. As well, the LED Tube series
pins can be configured for horizontal or vertical lighting and are available in
either clear or frosted lenses.
The LED Tube series contains many advantages over traditional
fluorescent tube lighting. Overall product performance is far superior; they are
capable of starting at much colder temperatures, and do not flicker or hum like
traditional fluorescent tubes tend to do. Quality of light is also much better,
and both wattage and yearly power consumption is much lower. LED Tube series
products also do not require a ballast like traditional fluorescent tubes do,
and last significantly longer resulting in a substantial decrease in
installation and maintenance costs.
7
Results of Operations
Operating Expenses
Our operating expenses for the three month periods ended
September 30, 2014 and 2013 are outlined in the table below:
|
|
Three |
|
|
Three |
|
|
|
Months |
|
|
Months |
|
|
|
Ended |
|
|
Ended |
|
|
|
September 30, |
|
|
September 30, |
|
|
|
2014 |
|
|
2013 |
|
Revenues |
$ |
2,015 |
|
$ |
2,749 |
|
Cost of Goods Sold |
$ |
(1,632 |
) |
$ |
(1,149 |
) |
Operating Expenses |
$ |
(10,905 |
) |
$ |
(16,836 |
) |
Income Tax Expense |
$ |
Nil |
|
$ |
Nil |
|
Net Loss |
$ |
(10,522 |
) |
$ |
(15,236 |
)
|
Revenues
We earned revenues of $2,015 for the three month period ended
September 30, 2014 compared to $2,749 for the three month period ended September
30, 2013 for a decrease of $734 or approximately 26.7% . The decrease in sales
for the three month period ended September 30, 2014 is primarily due to
increases in competition as more and more sellers entering the market during the
past few years and the slow development of LED lighting in the building
industry. Our gross profit for three month period ended September 30, 2014 was
$383 compared to $1,600 for the three month period ended September 30, 2013 for
a decrease of $1,217 or approximately 76.1% due to a decrease in sale revenues
and higher cost of goods sold.
Operating Expenses
Our consolidated expenses for the three month periods ended
September 30, 2014 and 2013:
|
|
Three Months |
|
|
Three Months |
|
|
|
Ended |
|
|
Ended |
|
|
|
September 30, |
|
|
September 30, |
|
|
|
2014 |
|
|
2013 |
|
General and administrative
expenses |
$ |
8,054 |
|
$ |
13,061 |
|
Professional fees |
$ |
Nil |
|
$ |
792 |
|
Salaries and wages |
$ |
2,851 |
|
$ |
2,983 |
|
Total Expenses |
$ |
10,905 |
|
$ |
16,836 |
|
Our general and administrative expenses include rent, telephone
and internet services, banking changes and miscellaneous office supply costs.
Our professional fees include legal and accounting fees. The decrease in
expenses for the three month period ended September 30, 2014 is primarily due to
cost reduction as we experienced lower sale revenues.
Earnings after Taxes
The net loss for the three month period ended September 30,
2014 was $10,522 compared to a net loss of $15,236 during the three month period
ended September 30, 2013. The decrease in net loss for the three month period
ended September 30, 2014 is primarily due to lower operating expenses.
8
Liquidity and Capital Resources
|
|
At |
|
|
At |
|
|
|
September 30, |
|
|
June 30 |
|
|
|
2014 |
|
|
2014 |
|
Current Assets |
$ |
1,707 |
|
$ |
967 |
|
Current Liabilities |
$ |
90,905 |
|
$ |
83,882 |
|
Working Capital (Deficit) |
$ |
(89,198 |
) |
$ |
(82,915 |
)
|
As at September 30, 2014, we were obligated to related parties,
Tong Tang, our president, chief executive officer and director and a number of
shareholders, for $68,536 in funds advanced to us for working capital. The
advances are unsecured and no interest rate or payback schedule has been
established.
At September 30, 2014, our company had a cash balance and total
assets of $1,707 and $1,707 compared with cash balance and total assets of $967
and $967 as at June 30, 2014. The increase in cash and total assets were
attributed primarily to receipt of sales revenue from the sale of products
before making payment to supplier.
As at September 30, 2014, our company had total liabilities of
$90,905 compared with $83,882 as at June 30, 2014. The increase$7,032 was
attributed to increases in payables and due to related parties.
As at September 30, 2014, our company had a working capital
deficit of $89,198 compared with a working capital deficit of $82,915 as at June
30, 2014.
|
|
Three Months |
|
|
Three Months |
|
|
|
Ended |
|
|
Ended |
|
|
|
September 30, |
|
|
September 30, |
|
|
|
2014 |
|
|
2013 |
|
Net Cash Provided by (Used
in) Operating Activities |
$ |
(3,499 |
) |
$ |
(27,548 |
) |
Net Cash Provided by Financing Activities |
$ |
Nil |
|
$ |
Nil |
|
Net Cash Provided by (Used
In) Investing Activities |
$ |
Nil |
|
$ |
Nil |
|
Net Increase (Decrease) In Cash During The
Period |
$ |
740 |
|
$ |
(27,543 |
) |
Cash Flow from Operating Activities
During the three months ended September 30, 2014, our company
used $3,499 of cash for operating activities compared with $27,548 used during
the three months ended September 30, 2013. The decrease in the use of cash for
operating activities was primarily due to decrease in activities related to
listing application and ongoing company expenses.
Cash Flow from Financing Activities
During the three months ended September 30, 2014, our company
did not receive any cash for financing activities compared with $Nil received
during the three months ended September 30, 2013. There were no financing
activities during the last three month period.
Cash Flow from Investing Activities
We have not engaged in any investing activities since
inception.
9
Going Concern
We incurred a net loss of $10,522 during the three month period
from to September 30, 2014. We have commenced limited operations, raising
substantial doubt about our ability to continue as a going concern. We will seek
additional sources of capital through the issuance of debt or equity financing,
but there can be no assurance that we will be successful in accomplishing our
objectives.
Our ability to continue as a going concern is dependent on
additional sources of capital and the success of our plan. The financial
statements do not include any adjustments relating to the recoverability and
classification of recorded asset amounts, or amounts and classification of
liabilities that might result from the outcome of this uncertainty.
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.
Estimated Expenses
Our expenses for the twelve month period beginning from October
1, 2014 are estimated to be approximately $70,000. With our working capital
deficit of $89,198 as at September 30, 2014, we will need to raise additional
capital to cover our expenses for this twelve month period beginning from
October 1, 2014. We plan to raise additional funding either from new share
issuance or from loans from shareholders.
Estimated
Expenses For the Twelve Month Period Beginning October 1, 2014 |
General, Administrative, and Corporate Expenses |
$ |
60,000 |
|
Operating Expenses |
$ |
10,000 |
|
Total |
$ |
70,000 |
|
At present, our cash requirements for the next 12 months
(beginning October 1, 2014) outweigh the funds available to maintain or develop
our business. Of the $70,000 that we require for the next 12 months, we have
$1,707 in cash as of September 30, 2014 and a working capital deficit of
$89,198. In order to improve our liquidity, we plan to pursue additional equity
financing from private investors or possibly a registered public offering. We do
not currently have any definitive arrangements in place for the completion of
any further private placement financings and there is no assurance that we will
be successful in completing any further private placement financings. If we are
unable to achieve the necessary additional financing, then we plan to reduce the
amounts that we spend on our business activities and administrative expenses in
order to be within the amount of capital resources that are available to us.
We have not investigated the availability of commercial loans
or other debt financing to supplement or meet our cash requirements. In the
uncertain event that any such debt financing alternatives were available to us
on acceptable terms, they would increase our liabilities and future cash
commitments.
If we are able to raise the required funds to fully implement
our business plan, we plan to implement the business actions in the order
provided below. If we are not able to raise all required funds, we will
prioritize our corporate activities as chronologically as follows:
10
January 1, 2014 to December 31, 2014:
- Maintain companys filing requirements.
- Carry out marketing activities.
- Participate at trade shows.
- Market our services to our various contacts.
- Establish a partnership or strategic relationship with other distribution
companies.
Future Financings
We will continue to rely on equity sales of our common shares
and funding from directors and shareholders in order to continue to fund our
business operations. Issuances of additional shares will result in dilution to
existing stockholders. There is no assurance that we will achieve any additional
sales of the equity securities or arrange for debt or other financing to fund
our operations and other activities.
Critical Accounting Policies
The summary of significant accounting policies is presented to
assist in understanding the interim consolidated financial statements. The
interim consolidated financial statements and notes are the representations of
our companys management, who is responsible for their integrity and
objectivity. The interim consolidated financial statements have been prepared in
accordance with the instructions to Form 10-Q, and therefore do not include all
the information necessary for a fair presentation of financial position, results
of operations and cash flows in conformity with generally accepted accounting
principles. These interim consolidated financial statements should be read in
conjunction with the annual consolidated financial statements and footnotes
thereto included in our companys filed Form 10-K.
Basis of Presentation
Our companys interim consolidated financial statements
included herein are prepared under the accrual basis of accounting in accordance
with accounting principles generally accepted in the United States of America.
These interim consolidated financial statements include our companys wholly
owned subsidiaries MJP Lighting Solutions Ltd. and MJP Holdings Ltd. and 100
percent of their assets, liabilities and net income or loss. All inter-company
accounts and transactions have been eliminated.
While the information presented in the accompanying interim
three months consolidated financial statements is unaudited, it includes all
adjustments, which are, in the opinion of management, necessary to present
fairly the financial position, results of operation and cash flows for the
interim periods presented. All adjustments are of a normal recurring nature.
Operating results for the period ended September 30, 2014 are not necessarily
indicative of the results that can be expected for the year ended June 30,
2015.
Recent Accounting Pronouncements
In May 2014, the Financial Accounting Standards Board issued
Accounting Standards Update (ASU) 2014-9,
Revenue from Contracts with Customers: Topic 606 (ASU
2014-9). ASU 2014-9 is intended to enhance comparability of revenue recognition
practices across entities, industries, jurisdictions, and capital markets,
improve disclosure to help users of financial statements better understand the
nature, amount, timing, and uncertainty of revenue that is recognized, and
provide guidance for transactions that are not currently addressed
comprehensively. The standard is effective for fiscal years beginning after
December 15, 2016, and interim periods therein, and does not allow for early
adoption. Entities have the option of using either a full retrospective or
modified retrospective approach for the adoption of the standard. Our company
has begun the evaluation of the impact that the standard will have on its
consolidated financial statements but has not yet selected a transition method.
11
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
Evaluation of 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, is recorded,
processed, summarized and reported within the time periods specified in the
Securities and Exchange Commissions 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 principal
accounting officer) to allow for timely decisions regarding required disclosure.
In designing and evaluating our disclosure controls and procedures, our
management recognizes that any controls and procedures, no matter how well
designed and operated, can provide only reasonable assurance of achieving the
desired control objectives, and our management is required to apply its judgment
in evaluating the cost-benefit relationship of possible controls and
procedures.
As of the end of our quarter covered by this report, we carried
out an evaluation, under the supervision and with the participation of our
management, including our president (our principal executive officer, principal
financial officer and principal 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 principal accounting officer) concluded that our disclosure controls
and procedures were not effective as of the end of the period covered by this
quarterly report.
Changes in Internal Control
During the period covered by this report there were no changes
in our internal control over financial reporting that materially affected, or
are reasonably likely to materially affect, our internal control over financial
reporting.
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.
12
Item
4. Mine Safety
Disclosures
Not applicable.
Item
5. Other
Information
None.
Item
6. Exhibits
* |
Filed herewith. |
|
|
** |
Furnished herewith. Pursuant to Rule 406T of
Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are
deemed not filed or part of any registration statement or prospectus for
purposes of Sections 11 or 12 of the Securities Act of 1933, are deemed
not filed for purposes of Section 18 of the Securities and Exchange Act of
1934, and otherwise are not subject to liability under those
sections. |
13
SIGNATURES
In accordance with the requirements of the Securities Exchange
Act of 1934, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
|
|
MJP INTERNATIONAL LTD.
|
|
|
|
|
|
|
|
|
|
Dated: November 7, 2014 |
By: |
/s/Chris Tong Tang |
|
|
Chris Tong Tang |
|
|
President, Chief Executive
Officer and Director |
|
|
(Principal Executive Officer,
Principal Financial |
|
|
Officer and Principal Accounting
Officer) |
14
EXHIBIT 31.1
CERTIFICATION PURSUANT TO
18 U.S.C. ss 1350, AS
ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Chris Tong Tang, certify that:
1. |
I have reviewed this quarterly report on Form 10-Q of MJP
International Ltd.; |
|
|
2. |
Based on my knowledge, this report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances under
which such statements were made, not misleading with respect to the period
covered by this report; |
|
|
3. |
Based on my knowledge, the financial statements, and
other financial information included in this report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
report; |
|
|
4. |
The registrant's other certifying officer(s) and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and
internal control over financial reporting (as defined in Exchange Act
Rules 13a-15(f) and 15d-15(f)) for the registrant and
have: |
|
(a) |
Designed such disclosure controls and procedures, or
caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to us
by others within those entities, particularly during the period in which
this report is being prepared; |
|
|
|
|
(b) |
Designed such internal control over financial reporting,
or caused such internal control over financial reporting to be designed
under our supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted
accounting principles; |
|
|
|
|
(c) |
Evaluated the effectiveness of the registrant's
disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls and
procedures, as of the end of the period covered by this report based on
such evaluation; and |
|
|
|
|
(d) |
Disclosed in this report any change in the registrant's
internal control over financial reporting that occurred during the
registrant's most recent fiscal quarter (the registrant's fourth fiscal
quarter in the case of an annual report) that has materially affected, or
is reasonably likely to materially affect, the registrant's internal
control over financial reporting; and |
5. |
The registrant's other certifying officer(s) and I have
disclosed, based on our most recent evaluation of internal control over
financial reporting, to the registrant's auditors and the audit committee
of the registrant's board of directors (or persons performing the
equivalent functions): |
|
(a) |
All significant deficiencies and material weaknesses in
the design or operation of internal control over financial reporting which
are reasonably likely to adversely affect the registrant's ability to
record, process, summarize and report financial information; and |
|
|
|
|
(b) |
Any fraud, whether or not material, that involves
management or other employees who have a significant role in the
registrant's internal control over financial
reporting. |
Date: November 7, 2014 |
|
|
|
|
|
/s/ Chris Tong
Tang |
|
Chris Tong Tang |
|
President, Chief Executive Officer and Director |
|
(Principal Executive Officer, Principal Financial |
|
Officer and Principal Accounting Officer) |
|
EXHIBIT 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350, AS ADOPTED
PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Chris Tong Tang, hereby certify, pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002, that:
(1) |
the Quarterly Report on Form 10-Q of MJP International
Ltd. for the period ended September 30, 2014 (the Report) fully complies
with the requirements of Section 13(a) or 15(d) of the Securities Exchange
Act of 1934; and |
|
|
(2) |
the information contained in the Report fairly presents,
in all material respects, the financial condition and results of
operations of MJP International Ltd. |
Dated: November 7, 2014
|
/s/
Chris Tong Tang |
|
Chris Tong Tang |
|
President, Chief Executive Officer and Director
|
|
(Principal Executive Officer, Principal
Financial Officer and |
|
Principal Accounting Officer) |
|
MJP International Ltd. |
A signed original of this written statement required by Section
906, or other document authenticating, acknowledging, or otherwise adopting the
signature that appears in typed form within the electronic version of this
written statement required by Section 906, has been provided to MJP
International Ltd. and will be retained by MJP International Ltd. and furnished
to the Securities and Exchange Commission or its staff upon request.
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