CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

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





Overview

Arion Group Corp. was incorporated in the State of Nevada on November 7, 2016 and established a fiscal year end of January 31. We are currently a start-up company exploring various manufacturing and distribution business opportunities in the dietary ingredient and nutritional supplement industry. However, as of the filing of this statement 10-Q no definitive agreement has been entered into in connection with our business plan related to the above targeted industry.

On Nov 21, 2018 (the "Closing Date"), a change in control of the Company occurred, pursuant to which Mr. Mingyong Huang acquired a total of 5,000,000 shares of the Company's common stock (or approximately 65.53% of the total issued and outstanding shares of the Company as of the date of acquisition) from Ms. Nataliia Kriukova, the previous principal shareholder of the Company. Pursuant to the SPA and other related agreements, Ms. Nataliia Kriukova resigned from all management and Board positions. The Company also paid off the shareholder loan owed to Ms. Kriukova in the amount of $2,663 with cash and inventory on hand pursuant to the SPA on November 21, 2018.

Prior to November 21, 2018, we distributed an assortment of cedar phyto barrels in the USA and Europe. Our products were offered at prices marked-up from 80% to 100% of our cost. Our customers were asked to pay us 100% in advance. We filled placed orders and supplied the products within a period of thirty days (30) days or less following receipt of any written order. Customers were responsible for the custom duties, taxes, insurance or any other additional charges that might incur. The business of distribution of cedar phyto barrels was discontinued after November 21, 2018.

Concurrent with the change of control, we have changed our business plan to focus on medical & health care industry, including consulting services provided to third parties for planning, design and compliance of cannabis cultivation in the USA. As of October 31, 2019, we have generated $6,000 of revenue for the 9-months ended October 31, 2019 from consulting services. No consulting service revenue was generated for the 3-month period ending October 31, 2019.





RESULTS OF OPERATIONS

Three Months Ended October 31, 2019 compared to Three Months Ended October 31, 2018





Revenue

For the three months ended October 31, 2019 and October 31, 2018, we generated $0 and $0 in revenue, respectively. We discontinued cedar phyto barrel business activities in the year ended January 31, 2019, following the change in control of November 21, 2018. We were unable to generate any cedar phyto barrel sales in the three months ended October 31, 2018.





Operating Expenses

During the three-month period ended October 31, 2019, we incurred $10,232 in general and administrative expenses compared to $3,907 in the same period of 2018, which represents an increase in the amount of $6,325. General and administrative expenses incurred are mostly related to corporate compliance services.





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Net Loss

Our net loss for the three months ended October 31, 2019 was $10,232, which is an increase of $6,325 compared to net loss of $3,907 for the three months ended October 31, 2018. The increase in net loss is primarily due to the increase in the Company's operating expenses during the three-month period ended October 31, 2019.

Nine Months Ended October 31, 2019 compared to Nine Months Ended October 31, 2018





Revenue

For the nine months ended October 31, 2019 and October 31, 2018, we generated $6,000 and $0 in revenue, respectively. We discontinued cedar phyto barrel business activities in the year ended January 31, 2019, following the change in control of November 21, 2018. The $6,000 revenue was generated in the three-months ended April 30, 2019 by providing consulting services to a third party for planning, design and compliance of cannabis cultivation in the USA. We were unable to generate any cedar phyto barrel sales nor consulting services income in the three months ended October 31, 2018.





Operating Expenses

During the nine-month period ended October 31, 2019, we incurred $47,021in general and administrative expenses compared to $30,783 in the same period of 2018, which represents an increase in the amount of $16,238. General and administrative expenses incurred are mostly related to corporate compliance services.





Net Loss

Our net loss for the nine months ended October 31, 2019 was $41,021, which is an increase of $10,238 compared to net loss of $30,783 for the nine months ended October 31, 2018. The increase in net loss is primarily due to the increase in the Company's operating expenses during the nine-month period ended October 31, 2019.

LIQUIDITY AND CAPITAL RESOURCES

At October 31, 2019, we had cash in bank of $11,957 , an increase by $2,867 from the cash in bank balance of $9,090 at January 31, 2019. We received a net $20,432 loan from our major shareholder during the year ended January 31, 2019. We were able to borrow an additional $40,000 from the same shareholder to pay operating expenses during the nine-month period ended October 31, 2019.

The cash in bank of $11,957 was our only current assets as of October 31, 2019. We had $66,200 in total current liabilities as of October 31, 2019, including $5,768 in accounts payable and $60,432 for loan from related parties. The October 31, 2019 current liabilities are an increase in the amount of $43,656 as compared to the total current liabilities of $22,544 at January 31, 2019.

We have a working capital deficit as of October 31, 2019 in the amount of $54,243. For the period from inception (November 7, 2016) to October 31, 2019, we had an accumulated net loss of $85,265. Our net worth was a negative $53,965 as of October 31, 2019. This raises substantial doubt about our ability to continue as a going concern within one year after the date that the financial statements are issued.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and has incurred an accumulated deficit and working capital deficit as of October 31, 2019. These factors raise substantial doubt about its ability to continue as a going concern.

Our independent auditor's report accompanying our January 31, 2019 and 2018 audited financial statements contains an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. These financial statements have been prepared "assuming that we will continue as a going concern," which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business. This assumption may, however, not hold true for a variety of reasons, many of which are out of our control.





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Our principal shareholder has informally agreed to lend us some of the funds needed for some of our operating expenses, but he has no legal obligation to do so and may discontinue making any such loans at any time. Our failure to achieve the necessary levels of profitability or obtain the additional significant funding required to meet our expenses and other financial obligations would be detrimental to us.

Cash Flows from Operating Activities

For the nine months ended October 31, 2019, net cash used by operating activities was $37,133, consisting of a net loss of $41,021, a non-cash expense of depreciation of $232, and an increase in accounts payable for $3,656 (which decreased the cash basis net loss).

Cash flows from Investing Activities

Cash flows used in investing activities for the nine months ended October 31, 2019 and 2018 were $0 and $0, respectively.

Cash flows from Financing Activities

Cash flows provided by financing activities for the nine months ended October 31, 2019 and 2018 were $40,000 and $0, respectively. We were able to borrow an additional $20,000 loan from one of our major shareholders in April and May 2019 to pay operating expenses. In the month of August 2019, we were able to borrow a total of $10,000 from one of our major shareholders. In the month of September 2019, we were able to borrow a total of $10,000 from one of our major shareholders to pay operating expenses.

PLAN OF OPERATION AND FUNDING

We have no lines of credit or other bank financing arrangements. Currently we are financed by our major shareholders. Our working capital requirements for the next 12 months are expected to increase if and when we are able to execute on our current business plan.

We also intend to finance our operating expenses and business development costs with further issuances of securities and debt issuances. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.





MATERIAL COMMITMENTS

As of the date of this Quarterly Report, we do not have any material commitments.

PURCHASE OF SIGNIFICANT EQUIPMENT

We do not intend to purchase any significant equipment during the next twelve months.

OFF-BALANCE SHEET ARRANGEMENTS

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





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