The following discussion and analysis should be read in conjunction with the
balance sheet as of June 30,2021 and December 31,2021 and the financial
statements for the six months period ended December 31, 2021 included herein.
The results shown herein are not necessarily indicative of the results to be
expected for any future periods.
This discussion contains forward-looking statements, based on current
expectations with respect to future events and financial performance and
operating results, which statements are subject to risks and uncertainties,
including but not limited to those discussed below and elsewhere in this
Prospectus that could cause actual results to differ from the results
contemplated by this forward-looking statement. We urge you to carefully
consider the information set forth in our S1form under the heading "Note
Regarding Forward Looking Statements" and "Risk Factors".
We are an emerging growth company incorporated in the State of Nevada on June
23, 2017. The United Express Inc. was developed to provide a comprehensive
management service for long and short distance logistics for clients in the
Company's target market area. The Company will offer its clients the
transportation ability to all of their hauling needs through one business which
will provide them with the ability to manage their shipments in a cost and time
effective manner. Also, we develop our dispatch service, logistics and selling
used appliances.
Forward-Looking Statements
The Securities and Exchange Commission ("SEC") encourages companies to disclose
forward-looking information so that investors can better understand future
prospects and make informed investment decisions. Our registration statement
contains these types of statements. Words such as "may," "expect," "believe,"
"anticipate," "estimate," "project," or "continue" or comparable terminology
used in connection with any discussion of future operating results or financial
performance identify forward-looking statements. You are cautioned not to place
undue reliance on the forward-looking statements, which speak only as of the
date of this prospectus. All forward-looking statements reflect our present
expectation of future events and are subject to a number of important factors
and uncertainties that could cause actual results to differ materially from
those described in the forward-looking statements. The factors listed in the
"Risk Factors" section in our S1 form, as well as any cautionary language in
this prospectus, provide examples of these risks and uncertainties. The safe
harbor for forward-looking statements is not applicable to this offering
pursuant to Section 27A of the Securities Act of 1933.
Business Overview
We are an Emerging growth company with strong revenue generating operations. We
were formed on June 23, 2017 and have more than four years of business
experience.
The United Express intends to operate as a general company of transportation and
delivery of merchandise, household goods, and other items for companies and
individuals across the United State. As such, it is difficult to determine the
average customer of the Company as the business will have the licensure and the
ability to effectively arrange for the transportation any type of merchandise.
Management anticipates that the business will receive orders for service from
companies seeking to move merchandise, as well as, people relocating to
different areas of the target regional market area. A primary concern for the
Company is its ability to quickly respond to customer request, give affordable
price for the services, and carry the full responsibility from pick up to drop
off. In this quarter, the price of oil and its associated refined energy
products has been within a reasonable, steady range. Lack of major volatile in
oil prices has caused the freight and logistic industries costs to be on a
straight level during last 3 months. In the event of an increase in the price of
fuel, we will also reasonably increase prices (at a standardized rate of markup)
to ensure the profitability of the business.
For the 3 months ended December 31, 2021 our business activities have focused on
dispatch service, logistics and selling used appliances. As of December 31,2021,
we had income $149,127 from CVK Express LLC., for dispatch, $14,577 from ARI
Logistics for the logistic service, $136,860 we received from companies for
appliances. Our three months revenues for the period ended December 31,2021 was
$300,564.
As of December 31,2020, mostly we generated income from CVK Express LLC.
$146,500 for dispatch, $22,150 from companies for logistic service and 219,370
from companies who bought from us used appliances.
Our three months revenues for the period ended December 31,2020 was $388,020.
We also cooperate with private people and companies when they ask about
transportation service, up in coming move, relocation, and other's needs.
11
Working in logistics industry we observe desire truck owner operators or drivers
get paid right after Bill of lading signed and cargo unloaded, instead of
waiting 30-40 days. Factoring service can be solutions in this situation. In the
simplest terms, invoice factoring is how get paid fast in the trucking industry.
It's a way to get consistent cash flow for unpaid invoices.
Drivers agree get pay 4% (factoring fees) less than original earnings. Based on:
1 driver generates earnings somewhere about $40,000 in a month and 4% is $1,600.
We can operate with 100 drivers at the same time during a month. So, our
earnings with 100 drivers will be $4,000,000 and 4% is $160,000.
Consistent cash flow is a key in being successful in the transportation
industry. It's always good to have that safety net to know you will always get
paid within 24-48 hours when you use a factoring service.
Another direction in which we are going to excel is directly working with
Hyundai manufacturing located in Baja California, Tijuana, Mexico. It's very
close to US border and we see a great potential in this. They build over 150
containers per day and we want to delivery their Hyundai dry van containers to
US customers. Based on our research they pay $700 per container and allowed to
download cargo to deliver it to the final destination. The other dealers who
already work with Hyundai can pay us only half of this price for the same route.
In this activity we plan to generate extra $15,000-$20,000 in a month net
income.
In addition, given the high demand for these containers, we can also buy them at
the production price and resell them at a premium or even rent them out. For
this activity we need at least $30,000 for one dry van. We can give trailer for
rent $800-$1000 in a month with full payback in 3 years. We are planning begin
with 40-50 trailers and we need about 1,3-1,5 millions of attracted capital.
Repairs and maintenance will be calculated additionally if necessary.
Base on the above we need around $5,5-6 millions for these new activities.
Our fees are count based on our expenses, spending time, shipments size and type
of shipment, distance, route, gas price and other customer needs.
For the three months period ended December 31,2021, we
• continue develop our business plan;
• selected business partners;
• Continue work with ARI Logistics LLC, Alabama company and serve for them as
freight agency;
• found the cargo brokers;
• continue to provide dispatch service;
• created a list of potential customers and their requirements;
• found service company for van maintenance and repairs;
• chose optimal routes of traffic continue selling used appliances
Because our revenues are concentrated in a few customers and if should one or
more of them decrease their orders or cease to use our services, or if we are
unable to expand our customer base, our revenues and results of operations will
be negatively impacted.
Our revenue for the 3 months ended December 31, 2021 was $300,564. It is a
little lower than in similar period year ago. Our three months revenues for the
period ended December 31,2020 was $388,020.
Liquidity
At December 31, 2021, we had $49,334 in cash for our operations and $16,000 in
capital. For the period ended December 31,2020 we had 12,252 in cash for our
operations. We will attempt to fund from our future operations, which may be
insufficient to fund such amounts. There is no assurance our estimates of these
costs are accurate.
Capital resources
We have the fixed assets on our balance Mercedes Sprinter as of December 31,
2021. Total stockholders' equity $65,334.
12
Results of Operations for the six months period ended December 31, 2021 and for
the six months period ended December 31, 2020
As an emerging growth company, we have received $643,422 operating revenues for
the six months period ended December 31,2021 and 496,470 for the six months
period ended December 31,2020. Recorded revenues were generated from customers'
payments. The Company is currently devoting substantially of its present efforts
to customer network and establishing the dispatch, transportation and used
appliances business.
For the six months period ended December 31, 2021 our revenue was generated from
our existing and new customers for the transportation, dispatch and used
appliances service. Our cash balance was $49,334.
For this period, we had Logistic and Dispatcher Service Expenses $356,630 and
used appliances expenses $248,850.
Also, for this period, we had $13,152 general and administration expense, $7,500
Expenses related OTC Market requirements, $2,500 Equipment Rental Expenses. Our
net income from operations was $ 14,784 in compare with our net income of $9,527
in similar period year ago.
For the six months period ended December 31, 2020 our revenue was generated from
our existing and new customers for the transportation, dispatch and used
appliances service. Our cash balance was $12,252.
For this period, we had Logistic and Dispatcher Service Expenses $253,723 and
used appliances Expenses $205,800.
Also, for this period, we had $20,920 general and administration expense, $6,500
Expenses related OTC Market requirements. Our net income from operations was $
9,527.
Our cash balances were not sufficient to fund our limited levels of operations
for any period of time without further revenue or proceeds. During start up
period, our operations will be limited due to the limited amount of funds on
hand. At the present time, we are working to raise additional cash, increase
the activities and generate more revenue.
If we unable to raise additional cash, we will either have to suspend operations
until we do raise the cash, or cease operations entirely.
Off Balance Sheet Arrangements
None
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