Item 1. Financial Statements.
US-DADI FERTILIZER INDUSTRY INTERNATIONAL,
INC.
(A Development Stage Company)
UNAUDITED FINANCIAL STATEMENTS
March 31, 2014 and 2013
Condensed Balance Sheets as of March 31, 2014 (Unaudited) and December 31, 2013
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4
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Condensed Statement of Operations for the Three Months Ended March 31, 2014 and 2013 and the Period of August 11, 2010 (Inception) to March 31, 2014 (Unaudited)
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5
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Condensed Statement of Cash Flows for the Three Months Ended March 31, 2014 and 2013 and the Period of August 11, 2010 (Inception) to March 31, 2014 (Unaudited)
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6
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Notes to Unaudited Condensed Financial Statements
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7
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3
US-DADI FERTILIZER INDUSTRY INTERNATIONAL, INC.
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(A Development Stage Company)
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Condensed Balance Sheets
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March 31, 2014
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December 31, 2013
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ASSETS
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Total assets
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$
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—
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$
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—
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LIABILITIES AND STOCKHOLDERS' DEFICIT
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Current liabilities
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Accounts payable
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$
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4,344
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$
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4,321
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Related party loans
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44,397
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36,280
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Total current liabilities
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48,741
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40,601
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Stockholders' deficit
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Common stock, no par value; 250,000,000 shares authorized; 54,365,000 issued and outstanding
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81,547
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81,547
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Accumulated deficit
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(130,288
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)
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(122,148
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)
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Total stockholders' deficit
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(48,741
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)
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(40,601
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)
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Total liabilities and stockholders' deficit
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$
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—
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$
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—
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See accompanying notes to unaudited condensed financial statements.
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4
US-DADI FERTILIZER INDUSTRY INTERNATIONAL, INC.
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(A Development Stage Company)
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Condensed Statements of Operations (Unaudited)
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Three months ended March 31,
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Period from August 11, 2010 (Inception) to March 31,
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2014
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2013
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2014
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Revenue
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$
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—
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$
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—
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$
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—
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Operating expenses
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General and administrative
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8,140
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4,712
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108,556
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Total operating expenses
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8,140
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4,712
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108,556
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Loss from operations
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(8,140
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)
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(4,712
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)
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(108,556
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)
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Other expense
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Interest expense
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—
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—
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100
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Total other expense
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—
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—
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(100
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)
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Income tax
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—
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—
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(2,400
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)
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Net loss
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$
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(8,140
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)
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$
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(4,712
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)
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$
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(111,056
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)
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Basic and diluted loss per common share
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$
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(0.00
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)
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$
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(0.00
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)
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Weighted average shares outstanding
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54,365,000
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54,457,933
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See accompanying notes to unaudited condensed financial statements.
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5
US-DADI FERTILIZER INDUSTRY INTERNATIONAL, INC.
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(A Development Stage Company)
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Condensed Statements of Cash Flows (Unaudited)
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Three months ended March 31,
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Period from August 11, 2010 (Inception) to March 31,
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2014
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2013
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2014
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Cash flows from operating activities
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Net loss
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$
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(8,140
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)
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$
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(4,712
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)
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$
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(111,056
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)
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Changes in operating liabilities:
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Accounts payable
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23
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(601
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)
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4,344
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Net cash used in operating activities
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(8,117
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)
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(5,313
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)
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(106,712
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)
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Cash flows from investing activities
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—
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—
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—
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Cash flows from financing activities
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Proceeds from bank overdraft
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—
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5,158
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—
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Proceeds from related party loans
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8,117
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—
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44,397
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Dividend
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—
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—
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(19,232
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)
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Cancellation of common shares
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—
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—
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(953
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)
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Proceeds from sale of stock
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—
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—
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82,500
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Net cash provided by financing activities
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8,117
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5,158
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106,712
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Net change in cash
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—
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(155
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)
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—
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Cash at beginning of period
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—
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155
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—
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Cash at end of period
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$
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—
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$
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—
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$
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—
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Supplemental cash flow information
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Cash paid for interest
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$
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—
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$
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—
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$
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100
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Cash paid for income taxes
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$
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—
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$
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1,700
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$
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2,400
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See accompanying notes to unaudited condensed financial statements.
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6
US-DADI FERTILIZER INDUSTRY INTERNATIONAL,
INC.
(A Development Stage Company)
Notes to Unaudited Condensed Financial
Statements
March 31, 2014 and 2013
NOTE 1 – CONDENSED FINANCIAL STATEMENTS
The accompanying financial statements have been prepared
by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary
to present fairly the financial position, results of operations, and cash flows March 31, 2014 and for all periods presented herein,
have been made.
Certain information and footnote disclosures normally included
in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have
been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial
statements and notes thereto included in the Company’s December 31, 2013 financial statements. The results of operations
for the periods ended March 31, 2014 are not necessarily indicative of the operating results for the full year.
NOTE 2 – GOING CONCERN
The Company’s financial statements are prepared using
generally accepted accounting principles in the United States of America 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 established an ongoing source
of revenues sufficient to cover its operating costs and allow it to continue as a going concern. 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.
In order to continue as a going concern, the Company will
need, among other things, additional capital resources. Management’s plan is to obtain such resources for the Company by
obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking equity
and/or debt financing. However management cannot provide any assurances that the Company will be successful in accomplishing any
of its plans.
The ability of the Company to continue as a going concern
is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other
sources of financing and attain profitable operations. 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 -3 RELATED PARTY LOAN
The Company received advances from related parties totaling
$8,117during the three months ended March 31, 2014.The advances from related parties are due on demand with no interest incurred.
Total balance owed as of March 31, 2014 was 44,397.
7
US-DADI FERTILIZER INDUSTRY INTERNATIONAL,
INC.
(A Development Stage Company)
Notes to Unaudited Condensed Financial
Statements
March 31, 2014 and 2013
NOTE 4 – SUBSEQUENT EVENTS
The Company has evaluated subsequent
events through the date of this filing and determined there are no events to disclose.
8
Item 2. Management’s Discussion and Analysis of
Financial Condition and Results of Operations
This Quarterly Report on Form 10-Q contains
forward-looking statements and involves risks and uncertainties that could materially affect expected results of operations, liquidity,
cash flows, and business prospects. These statements include, among other things, statements regarding:
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our ability to diversify our operations;
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•
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inability to raise additional financing for working capital;
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•
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the fact that our accounting policies and methods are fundamental to how we report our financial condition and results of operations, and they may require our management to make estimates about matters that are inherently uncertain;
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•
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our ability to attract key personnel;
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•
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our ability to operate profitably;
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•
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our ability to generate sufficient funds to operate the US-DADI Fertilizer Industry International, Inc. operations, upon completion of our acquisition;
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•
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deterioration in general or regional economic conditions;
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•
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adverse state or federal legislation or regulation that increases the costs of compliance, or adverse findings by a regulator with respect to existing operations;
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•
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changes in U.S. GAAP or in the legal, regulatory and legislative environments in the markets in which we operate;
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•
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the inability of management to effectively implement our strategies and business plan;
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•
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inability to achieve future sales levels or other operating results;
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•
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the unavailability of funds for capital expenditures;
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•
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other risks and uncertainties detailed in this report;
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as well as other statements regarding our future operations,
financial condition and prospects, and business strategies. These forward-looking statements are subject to certain risks and uncertainties
that could cause our actual results to differ materially from those reflected in the forward-looking statements. Factors that could
cause or contribute to such differences include, but are not limited to, those discussed in this Quarterly Report on Form 10-Q,
and in particular, the risks discussed under the heading “Risk Factors” in Part II, Item 1A and those discussed in
other documents we file with the Securities and Exchange Commission. We undertake no obligation to revise or publicly release the
results of any revision to these forward-looking statements. Given these risks and uncertainties, readers are cautioned not to
place undue reliance on such forward-looking statements.
References in the following discussion and throughout
this quarterly report to “we”, “our”, “us”, “US-DADI”, “the Company”,
and similar terms refer to US-DADI Fertilizer Industry International, Inc. unless otherwise expressly stated or the context otherwise
requires.
9
OVERVIEW AND OUTLOOK
Background
US-DADI Fertilizer Industry International,
Inc. is a development stage company incorporated in the State of California on August 11, 2010. Our stated business objective is
a fertilizer-related products and equipment exporter. Since our inception on August 11, 2010 through March 31, 2014, we generated
no revenues from that line of business.
Going Concern
The Company’s financial statements are prepared using
generally accepted accounting principles in the United States of America 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 established an ongoing source
of revenues sufficient to cover its operating costs and allow it to continue as a going concern. As of March 31, 2014 the Company
had an accumulated deficit of $130,288. 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.
The Company is currently contemplating an offering of its
equity or debt securities to finance continuing operations. There are no agreements or arrangements currently in place or under
negotiation to obtain such financing, and there are no assurances that the Company will be successful and without sufficient financing
it would be unlikely for the Company to continue as a going concern.
The ability of the Company to continue as a going concern
is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other
sources of financing and attain profitable operations.
RESULTS OF OPERATIONS
During the three months ended March 31,
2014, we generated revenue of $0. During the three months ended March 31, 2013, we generated revenue of $0.
Operating expenses during the three months
ended March 31, 2014 were $8,140 all of which consisted of general and administrative expenses such as accounting, professional
and miscellaneous office expenditures. In comparison, operating expenses for the period ended March 31, 2013 were $4,712 all of
which consisted of general and administrative expenses such as accounting, professional and miscellaneous office expenditures.
We have not been profitable from our
inception in 2010 through March 31, 2014, and our accumulated deficit amounts to $130,288. There is significant uncertainty projecting
future profitability due to our history of losses and lack of revenues. In our current state we have no recurring or guaranteed
source of revenues and cannot predict when, if ever, we will become profitable. There is significant uncertainty projecting future
profitability due to our minimal operating history and lack of guaranteed ongoing revenue streams.
Liquidity and Capital Resources
As of March 31, 2014, we had $0 in cash
and did not have any other cash equivalents. The following table provides detailed information about our net cash flow for all
financial statement periods presented in this Quarterly Report. To date, we have financed our operations through the issuance of
stock and borrowings.
10
The following table sets forth a summary of our cash flows
for the three months ended March 31, 2014 and the period ending March 31, 2013:
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Three Months Ended
March 31, 2013
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Three Months Ended
March 31, 2014
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Net cash used in operating activities
|
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$
|
(5,313
|
)
|
|
$
|
(8,117
|
)
|
Net cash used in investing activities
|
|
|
—
|
|
|
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—
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Net cash provided by financing activities
|
|
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5,158
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|
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8117
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Net increase (decrease) in Cash
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(155
|
)
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—
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Cash, beginning
|
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155
|
|
|
|
—
|
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Cash, ending
|
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$
|
—
|
|
|
$
|
—
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|
Since inception, we have financed our
cash flow requirements through issuance of common stock. As we expand our activities, we may, and most likely will, continue to
experience net negative cash flows from operations, pending receipt of listings or some form of advertising revenues. Additionally
we anticipate obtaining additional financing to fund operations through additional common stock offerings, to the extent available,
or to obtain additional financing to the extent necessary to augment our working capital.
We anticipate that we will incur operating
losses in the next twelve months. Our lack of operating history makes predictions of future operating results difficult to ascertain.
Our prospects must be considered in light of the risks, expenses and difficulties frequently encountered by companies in their
early stage of development, particularly companies in new and rapidly evolving markets. Such risks for us include, but are not
limited to, an evolving and unpredictable business model and the management of growth. To address these risks, we must, among other
things, obtain a customer base, implement and successfully execute our business and marketing strategy, continually develop and
upgrade our website, provide national and regional industry participants with an effective, efficient and accessible website on
which to promote their products and services through the Internet, respond to competitive developments, and attract, retain and
motivate qualified personnel. There can be no assurance that we will be successful in addressing such risks, and the failure to
do so can have a material adverse effect on our business prospects, financial condition and results of operations.
Operating activities
Net cash used in operating activities
was $8,117 for the period ended March 31, 2014, as compared to $5,313 used in operating activities for the period ended March 31,
2013. The increase in net cash used in operating activities was primarily due to a increase in professional fees.
Investing activities
Net cash used in investing activities
was $0 for the period ended March 31, 2014, as compared to $0 used in investing activities for the same period in 2013.
Financing activities
Net cash provided by financing activities
for the period ended March 31, 2014 was $8,117 as compared to $5,158 for the same period of 2013. The increase is related to loans
form related parties to fund the operating expenses of the company .
11
We believe that cash flow from operations
will not meet our present and near-term cash needs and thus we will require additional cash resources, including the sale of equity
or debt securities, to meet our planned capital expenditures and working capital requirements for the next 12 months. We will require
additional cash resources due to changed business conditions, implementation of our strategy to expand our sales and marketing
initiatives, increase brand awareness, or acquisitions we may decide to pursue. If our own financial resources and then current
cash-flows from operations are insufficient to satisfy our capital requirements, we may seek to sell additional equity or debt
securities or obtain additional credit facilities. The sale of additional equity securities will result in dilution to our stockholders.
The incurrence of indebtedness will result in increased debt service obligations and could require us to agree to operating and
financial covenants that could restrict our operations or modify our plans to grow the business. Financing may not be available
in amounts or on terms acceptable to us, if at all. Any failure by us to raise additional funds on terms favorable to us, or at
all, will limit our ability to expand our business operations and could harm our overall business prospects.
Off-Balance Sheet Arrangements
We did 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.