The following discussion and analysis of our results of operations and financial
condition should be read together with our unaudited condensed financial
statements and the notes thereto, which are included elsewhere in this report
and our Annual Report on Form 10-K for the year ended December 31, 2019 (the
"Annual Report") filed with SEC. Our financial statements have been prepared in
accordance with U.S. GAAP. In addition, our financial statements and the
financial information included in this report reflect our organizational
transactions and have been prepared as if our current corporate structure had
been in place throughout the relevant periods
Exent Corp. (the "Company," "we" or similar terminology) was incorporated in the
state of Nevada on February 15, 2017. Our original business was manufacturing
and selling steel drywall studs in the Kyrgyz market to wholesale customers.
During the fiscal year of 2019, we sold machine for studs manufacturing as it
was outdated. Production thereafter was temporarily on hold until new equipment
was to be purchased.
On February 3, 2020, pursuant to a stock purchase agreement dated on January 21,
2020, an individual investor (Mr. Weining Zheng) purchased 1,500,000 shares of
our common stock from our then majority shareholder, Marat Asylbekov,
representing 74% of the voting securities of the Company (the "Change of
Control").
Following the Change of Control, we changed our business plan to engage in
smart-home business in the People's Republic of China.
We plan to conduct "smart-home" business in the People's Republic of China, with
a focus on developing, promoting and executing a business aimed at providing
high quality integrated technologies and solutions like sensors, Internet and
automation control to create a centralized, digital system for homes. We are
presently evaluating the optimal corporate and legal structures in China
necessary to establish our business or to acquire and/or invest in existing
smart home businesses. Given the impact of the novel coronavirus epidemic on the
general economy of China and the smart-home industry in particular, we have
decided to delay our plan to start our smart-home business until 2021. We expect
that the funds to finance the commencement of this new business or acquisition
of and/or investment in existing smart home businesses in China will primarily
come from our major shareholder.
However, our plan to operate in the smart-home industry may be adversely
impacted by the novel coronavirus epidemic, which was first reported to have
surfaced in Wuhan, China, in December 2019, and is now continuing to affect the
world. Although China has made great efforts to contain the spread of the virus
and has appeared to bring the outbreak under control, the economy, financial
market and businesses in China have suffered from the pandemic. As a result of
the epidemic and its socioeconomic impact in China, we may change our plan to do
business in other industries in China should we determine that it is no longer
in the best interest of our stockholders and the Company to proceed with our
original plan.
13
Results of Operations
There was no revenue generated for the three and six months ended June 30, 2020
and 2019.
During the three months ended June 30, 2020, we incurred operating expenses of
$16,300 as compared to $4,578 during the same period of 2019. The increase in
2020 was due to the increase in professional fees after the Change of Control.
During the six months ended June 30, 2020, we incurred operating expenses of
$30,057 as compared to $11,227 during the same period of 2019. The increase in
2020 was due to the increase in professional fees after the Change of Control.
There were no other expenses incurred during the three months ended June 30,
2020 and 2019.
During the six months ended June 30, 2020, we had other expense of $4,623
relating to the write-off of the Company's property & equipment after the Change
of Control.
As a result of the foregoing, our net loss for the three and six months ended
June 30, 2020 was $16,300 and $34,680, respectively, as compared to the net loss
of $4,578 and $11,227 for the three and six months ended June 30, 2019,
respectively .
Liquidity and Capital Resources
As of June 30, 2020, our total assets were nil compared to $7,380 in total
assets at December 31, 2019. As of June 30, 2020, our total liabilities were
$8,850 compared to $26,524 at December 31, 2019. Stockholders' deficit was
$8,850 as of June 30, 2020 compared to the shareholders' deficit of $19,144 as
of December 31, 2019.
Cash Flows from Operating Activities
We have not generated positive cash flows from operating activities.
For the six months ended June 30, 2020, net cash flows used in operating
activities was $18,460 due to:
· net loss of $34,680;
· non-cash write-off of fixed assets of $4,623;
· Increase of prepaid expenses of $2,747;
· Increase of accounts payable of $8,850.
Net cash flows used in operating activities was $22,247 for the same period of
2019 due to:
· net loss of $11,227;
· non-cash depreciation expenses of $1,178;
· Decrease of accounts receivable of $10,000;
· Decrease of accounts payable of $2,198.
Cash Flows from Investing Activities
There were no investing activities for the six months ended June 30, 2020. For
the six months ended June 30, 2019, we received $15,000 proceeds from sales of
fixed assets.
Cash Flows from Financing Activities
We have financed our operations primarily from either advances from stockholders
or financing through the sales of securities. For the six months ended June,
2020, we received capital contributions of $18,450 from our major shareholder
for working capital uses. For the same period of 2019, we received loan proceeds
of $6,094 from our then sole officer and director.
Plan of Operation and Funding
Our future capital requirements will depend on numerous factors including, but
not limited to, the establishment and development of our new smart-home business
opportunities in China. We expect to depend on financing from our majority
shareholder to meet our current minimal operating expenses. As we are a start-up
company, our operating expenses are limited and discretional based on the
availability of its funds. Management believes that the financing from our
majority shareholder will support our planned operations over the next 12
months.
We do not have lines of credit or other bank financing arrangements. In
connection with our new business plan after the Change of Control, management
anticipates operating expenses and capital expenditures relating to: (i)
developmental expenses associated with a start-up business and (ii) marketing
expenses will be funded primarily by debt or equity financings from our majority
shareholder. However, there is no assurance that such funds will be available or
available on acceptable terms. 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.
14
Material Commitments
Since February 15, 2017 (inception) through December 31, 2019, our former sole
officer and director loaned us $26,524 to pay for incorporation costs and
operating expenses. As of December 31, 2019, the amount outstanding was $26,524.
The loan was non-interest bearing, due upon demand and unsecured. In connection
with the Change of Control in January 2020, the loan in the aggregate principal
of $26,524 was forgiven by the former officer and director in full.
Off-Balance Sheet Arrangements
As of the date of this 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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