JIU FENG INVESTMENT HONG KONG LTD - 10-Q - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Edgar Glimpses Via Acquire Media NewsEdge)
The following discussion should be read in conjunction with the financial
statements and the notes to those statements included elsewhere in this
Quarterly Report on Form 10-Q. This Quarterly Report on Form 10-Q contains
certain statements that are forward-looking within the meaning of the Private
Securities Litigation Reform Act of 1995. Certain statements contained in the
MD&A are forward-looking statements that involve risks and uncertainties. The
forward-looking statements are not historical facts, but rather are based on
current expectations, estimates, assumptions and projections about our industry,
business and future financial results. Our actual results could differ
materially from the results contemplated by these forward-looking statements due
to a number of factors, including those discussed in other sections of this
Quarterly Report on Form 10-Q.
Jiu Feng Investment Hong Kong, Ltd., (the "Company", "the "Registrant", "we",
"us" or "our") was formed on September 29, 2009 under the name Liberty Vision,
Inc. The Company provided web development and marketing services for clients. On
December 5, 2012 the Company disposed of its subsidiary corporation to a
shareholder for a nominal sum, as well as other management operations. On
December 16, 2012, the Company changed its name to Jiu Feng Investment Hong
Kong, Inc. On January 27, 2013, the Company announced the change of their ticker
symbol from "LBYV" to "JFIL." On July 24, 2013, the Company changed its business
sector to the medical sector. On September 30, 2013, the Company entered into a
world-wide five year licensing agreement with BioMark Technologies (Asia)
Limited ("BioMark") whereby the Company is licensed to sell, market, and, or,
distribute certain products pertaining to the health care industry; and to
conduct research and development of BioMark's cancer detection scanning
The Company develops and markets medical products under license from BioMark.
The products currently marketed include Bone-Induction Artificial Bone (BIAB)
products and Vacuum Sealing Drainage (VSD) products. The Company is also
licensed to conduct research and development of BioMark's cancer detection
scanning technology. In the event that the research and development of BioMark's
cancer detection scanning technology provides marketable technology, the Company
shall have the right of first refusal to a license to market, sell and
distribute such cancer detection scanning technology.
Results of Operations
For the three months ended May 31, 2014 compared to the three months ended May
We recognized no revenue in the three months ended May 31, 2014 and 2013 as we
have not commenced operations as yet.
The major components of our operating expenses for the three months ended May
31, 2014 and 2013 are outlined in the table below:
Three Months Three Months Increase
Ended May 31, Ended May 31, (Decrease)
2014 2013 %
Professional fees $ 10,377 $ 7,069 46.8 %
Officer compensation $ 39,000 $ 0 100.00 %
Other $ 1,700 $ 1,072 58.58 %
Total operating expenses $ 51,077 $ 8,141 (527.40 %)
During the three months ended May 31, 2014, we accrued $39,000 in officer
compensation while during the three months ended May 31, 2013 we made no accrual
for director compensation. We incurred $10,377 in professional fees for the
period ended May 31, 2014 compared to $7,069 for the same period in fiscal 2013.
During the three months ended May 31, 2014 we incurred $1,700 in other expenes
compared to $1,058 in the three months ended May 31, 2013. These increases in
our operating costs for the three months ended May 31, 2014, compared to the
same period in our fiscal 2013, were due to the accelerated implementation of
our business plan in the three months ended May 31, 2014 as compared to the
three months ended May 31, 2013.
Other expenses represent bank charges, filing fees, office and travel expenses.
The increase in these costs was attributable to changes in our business plan and
general corporate activities.
For the three months ended May 31, 2014, we recognized a net loss of $51,075
compared to a net loss of $8,141 for the corresponding period in 2013 due to the
factors discussed above.
Liquidity and Capital Resources
May 31, February 28,
Current Assets $ 4,988 $ 4,986
Current Liabilities $ 341,145 $ 290,068
Working Capital Deficit $ (336,157 ) $ (285,082 )
Cash Flow for the three months ended May 31, 2014 compared to the three months
ended May 31, 2013
The table below, for the periods indicated, provides selected cash flow
Three Months Three Months
May 31, 2014 May 31, 2013
Cash provided by (used in) operating activities $ (13,536 ) $ (8,141 )
Cash used in investing activities $ - $ -
Cash provided by financing activities $ 13,538 $ 8,127
Net increase (decrease) in cash $ 2 $ (14 )
The Company may raise additional capital through the sale of its equity
securities, through an offering of debt securities, or through borrowings from
financial institutions or related parties. By doing so, the Company hopes to
generate sufficient capital to execute its new business plan in the medical
sector on an ongoing basis. Management believes that actions presently being
taken to obtain additional funding provide the opportunity for the Company to
continue as a going concern. There is no guarantee the Company will be
successful in achieving these objectives.
Cash Flows from Operating Activities
Our net cash used in operating activities increased by $5,395 in the three
months ended May 31, 2014 compared to that in the three months ended May 31,
2013, representing an increase of 66.27%. The increase in net cash used in
operating activities was primarily the result of the increase in our net loss
from $8,141 in the three months ended May 31, 2013 to $51,075 during the three
months ended May 31, 2014, a reduction of $1,461 in our balance of accounts
payable during the three months ended May 31, 2014 and a $39,000 increase in our
accrued officer compensation during the three months ended May 31, 2014.
Cash Flows from Investing Activities
We did not generate or use any cash from investing activities during the three
months ended May 31, 2014 and 2013.
Cash Flows from Financing Activities
Our cash provided by financing activities increased from $8,127 for the three
months ended May 31, 2013 to $13,538 for the three months ended May 31, 2014. In
both periods, cash was provided by way of loan from related party. The increased
advance during the three months ended May 31, 2014 reflected the additional
funding required by the Company to finance its cash used in operating
activities.in the quarter.
We anticipate that additional funding will be required in the form of equity
financing from the sale of our common stock. However, we cannot provide
investors with any assurance that we will be able to raise sufficient funding
from the sale of our common stock or through a loan from our directors to meet
our obligations over the next twelve months. We do not have any arrangements in
place for any future equity financing.
Recent Accounting Pronouncements
See Note 2 to the Financial Statements.
Off Balance Sheet Arrangements
As of May 31, 2014, we did not have any significant off-balance-sheet
arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K.
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