The following discussion of our financial condition and results of operations
should also be read in conjunction with our unaudited consolidated financial
statements and the notes to those financial statements appearing elsewhere in
this report. The following discussion contains forward-looking statements
relating to future events or our future performance. Actual results may
materially differ from those projected in the forward-looking statements as a
result of certain risks and uncertainties set forth in this report. Although
management believes that the assumptions made and expectations reflected in the
forward-looking statements are reasonable, there is no assurance that the
underlying assumptions will, in fact, prove to be correct or that actual results
will not be different from expectations expressed in this report.



Business Overview




We are a holding company incorporated in Nevada. As a holding company with no
material operations of our own, we conduct a substantial majority of our
operations through our subsidiaries established in the People's Republic of
China, or "PRC" or "China," and the variable interest entity, or "VIE." We
control and receive the economic benefits of the VIE's business operations
through certain contractual arrangements. Because of our corporate structure, we
are subject to risks due to uncertainty of the interpretation and the
application of the PRC laws and regulations, including but not limited to a
limitation on foreign ownership of internet technology companies and regulatory
review of overseas listing of PRC companies through a special purpose vehicle,
and the validity and enforcement of the VIE Agreements. We are also subject to
the risks of uncertainty about any future actions of the PRC government in this
regard. In addition, the VIE Agreements may not be effective in providing
control over VIE. If we fail to comply with their rules and regulations, we may
also be subject to sanctions imposed by PRC regulatory agencies, including the
Chinese Securities Regulatory Commission.

We primarily engage in the manufacturing and distribution of organic fertilizer and the sales of agricultural products in the PRC. Our organic fertilizer products are sold under our brand names "Zongbao," "Fukang," and "Muliang."





We process crop straw (including corn, rice, wheat, cotton, and other crops)
into high-quality organic, nutritious fertilizers that are easily absorbed by
crops in three hours through our patented technology. Straws are common
agricultural by-products. In PRC, farmers usually remove the straw stubble that
remains after grains by burning them to continue farming on the same land. These
activities have resulted in significant air pollution, and they damage the
surface structure of the soil with a loss of nutrients. We turn waste into
treasure by transforming the straws into organic fertilizer, effectively
reducing air pollution. The straw organic fertilizer we produce does not contain
the heavy metals, antibiotics, and harmful bacteria common in the traditional
manure fertilizer. Our fertilizers also provide optimum levels of primary plant
nutrients, including multi-minerals, proteins, and carbohydrates that promote
the healthiest soils capable of growing healthy crops and vegetables. In
addition, it can effectively reduce the use of chemical fertilizers and
pesticides and reduce the penetration of large chemical fertilizers and
pesticides into the soil, thus avoiding water pollution. Therefore, our
fertilizer can effectively improve soil fertility and the quality and safety of
agricultural products.



We generated our revenue mainly from our organic fertilizers, which accounted
for approximately 67.2% and 88.3% of our total revenue for the three months
ended March 31, 2022, and 2021, respectively. We currently have two integrated
factories in Weihai City, Shandong Province, PRC, to produce our organic
fertilizers, which have been in operation since August 2015. We plan to improve
the technology for our existing straw organic fertilizer production lines in the
following aspects: (i) adopt more advanced automatic control technology for raw
material feed to shorten the processing time of raw material, and (ii)
manufacture powdered organic fertilizer instead of granular organic fertilizer
production in order to avoid the drying and cooling process, as such will
increase our production capacity.



With the focus on producing organic fertilizers, we also sell agriculture food
products, including apples, and as a sales agent for other large agriculture
companies in the PRC. In 2014, we rented 350 mu (about 57.66 acres) of
mountainous land as an apple orchard. The sales of apples generated less than 1%
of our total revenue for the three months ended March 31, 2022, and 2021. We
expect to generate more revenues from the sales of apples as the apple orchards
become more mature in the next few years.



                                       30






In addition, we plan to engage in the processing and distribution of black goat
products, with business commencing at the end of 2022. We are currently
constructing a deep-processing slaughterhouse and processing plant that is
expected to slaughter 200,000 black goats per year in Chuxiong City, Yunnan
Province, in China. Our black goat processing products include goat rib lets,
goat loin roast, goat loin chops, goat rack, goat leg, goat shoulder, goat leg
shanks, ground goat, goat stew meat, whole goat, half-goat, lamb viscera, etc.
We expect to start generating revenue from the black goat products at the end of
2022.



We have sold our industrial land and buildings in Shanghai through an
administratively organized private sale before the end of the fiscal year ended
December 31, 2021. We have cleared all liens and legal claims attached to our
subsidiary Zongbao and improved our cash position through the sale. We have
completed the sale in April 2021.



Viagoo Solutions




Viagoo logistic platform aims to provide a solution for shippers to easily
optimize the logistics resources by either listing their assets in the platform
for other shippers to book or requesting the logistic services via the platform.
Furthermore, the flexible sharing model ensures shippers and carriers can get
the best deals to reduce costs by maximizing unused resources.



Viagoo platform provides full online tracking, route optimization, and capacity
planning options to help the carriers efficiently manage their operations. Using
the Internet of Things (IoT), GPS, mobile integration, document and data
integration services, the Viagoo platform can empower shippers and carriers with
an up-to-date digital platform to support their digital transformations.
Furthermore, with a ready Application Programming Interface (API) to various
eCommerce platforms, shippers and carriers can plan their digital strategies and
grow their businesses.




Viagoo platform is built on a secured cloud environment tested and approved by
some key corporate users in the healthcare and logistics sectors. Viagoo is
seeking investments to expand its digital capability with advanced technology in
its plans, particularly in Artificial Intelligence, machine learning, blockchain
in transaction handling, data analytics in resource distribution, and cold chain
management. Also, using document automation and data integration technologies,
the Viagoo platform will offer value-added services such as insurance on the go,
vehicle lease financing, link up to rest stop, fuel, vehicle workshop services.



The acquisition of Viagoo Pte Ltd, a Singapore-based online logistic platform,
will enable the Muliang group of companies to optimize the transport logistics
to lower the cost of delivery and increase efficiency. The platform will connect
truck drivers to Muliang and provide end-to-end tracking of the delivery status.
With this platform, it is expected to reduce delivery costs by 30%.



Viagoo platform is expected to be opened to the China market where other
companies and merchants can book delivery services, and transporters can sign on
to list and provide their services. Development work began in August 2020 to
provide localization and support for map and address services in China. The
development and testing are expected to be completed in June 2022 and ready

for
launch in July 2022.



                                       31





Viagoo Business Model

Viagoo business model has three main revenue streams.

Viagoo Transport Marketplace (VTM) is the transaction platform for shippers and
carriers to list and accept delivery jobs. In addition, the platform provides
sharing functions where shippers can share the transport fleet to some common
places (e.g., shopping malls in the city). This service will reduce the waiting
time and fuels and result in huge cost savings.

? VTM provides single job and bulk orders or API connections for a job posting.

The fees are pre-calculated based on distance, areas, volume matric weight,

type of goods, delivery options, and time.

? Task tracking - Shippers can track the delivery status if the option for

tracking is required.

? eWallet option - eWallet will be used for the service purpose, and payment

will be deducted from the eWallet stored value.

? Reports - Delivery reports are available for shippers to track the performance


    and status of the delivery operation.




VTM is charged to carriers based on a certain percentage of the freight charges.
In addition, other add-on services like online insurance, rest stop services
will be an additional percentage charged to the service providers.



Viagoo Enterprise Services (VES) - is a cloud-based service that provides the
operation management to support the Transport and Logistics team. Through
various modules, the carrier's transport management can greatly optimize the
resources and achieve higher efficiency.

? Automatic Scheduling - Delivery / Invoice data will be pushed to the VES for

an automatic schedule to the driver via VES mobile app. The criteria of

automatic scheduling are based on location, time preference, and route zoning.

These criteria can be configured and fine-tuned as the business progresses.

? Route Optimisation - The system can automatically calculate the best routes

based on various delivery points and constraints such as "time window." With

route optimization, the transport planner can handle new delivery addresses

dynamically. Also, if there is a change in delivery plans due to various

unforeseen circumstances such as vehicle breakdown and customer last-minute


    cancellation, the system can re-optimize quickly by pushing a button.

? VES Driver app - Task tracking - Once the tasks are started, they will be

tracked until they are completed. If e-sign is accepted, customers can

sign and acknowledge the acceptance of goods using VES' mobile sign

feature built into the app or by taking a photo of the signed invoices or


        delivering orders (usually the last page of the document).




  ? Customer Notification - Customers will be notified via email upon the

completion of the delivery. A copy of the invoice/delivery order and the

signed copies will be sent to customers (customer email list to be maintained


    in the system) via email.

? Reports - Delivery reports are available for operations managers to track


        the performance and status of the delivery operations.

? VES Temperature Sensor Tracking Services - This is an additional module

for real-time tracking of temperature control (via a GPS temperature

tracking device installed in the truck) trucks to prevent food waste and


        ensure food safety.

VES is charged based on a monthly subscription by vehicles and by users. It is integrated with VTM and jobs received via VTM can be assigned and tracked automatically by VES.





Enterprise Systems - This is a project-based system integration. The enterprise
system is charged based on project price and annual maintenance service fees. As
Viagoo's smart logistics platform gains acceptance in local markets, we expect
business opportunities to arise for us to custom-build enterprise solutions in
the healthcare and logistics sectors. For example, Parkway Pantai Singapore uses
us to custom build the online logistic job assignment and track lab sample
collection/delivery between clinics/hospitals and labs. This is to facilitate
efficient deployment of the delivery resources and to ensure compliance is
achieved in a tightly controlled fashion.



                                       32





Recent Development



Impact of COVID-19




Started in December 2019, the outbreak of COVID-19 caused by a novel strain of
the coronavirus has become widespread in China and in the rest of the world,
including in each of the areas in which the Company, its suppliers and its
customers operate. In order to avoid the risk of the virus spreading, the
Chinese government enacted various restrictive measures, including suspending
business operations and quarantines, starting from the end of January 2020. We
followed the requirements of local health authorities to suspend operation and
production and have employees work remotely in February and March 2020. Since
April 2020, we gradually resumed production and are now operating at full
capacity.



As a result of the COVID-19 outbreak in December 2019 and continuing in the
first quarter of 2020, the Company's businesses, results of operations,
financial position and cash flows were adversely affected in 2020 with potential
continuing impacts on subsequent periods, including but not limited to the
material adverse impact on the Company's revenues as result of the suspension of
operations and decline in demand by the Company's customers.



We are monitoring the global outbreak and spread of the novel strain of
coronavirus (COVID-19) and taking steps in an effort to identify and mitigate
the adverse impacts on, and risks to, our business (including but not limited to
our employees, customers, other business partners, our manufacturing
capabilities and capacity and our distribution channels) posed by its spread and
the governmental and community reactions thereto. We continue to assess and
update our business continuity plans in the context of this pandemic, including
taking steps in an effort to help keep our workforces healthy and safe. The
spread of COVID-19 has caused us to modify our business practices (including
employee travel, employee work locations in certain cases, and cancellation of
physical participation in certain meetings, events and conferences), and we
expect to take further actions as may be required or recommended by government
authorities or as we determine are in the best interests of our employees,
customers and other business partners. We are also working with our suppliers to
understand the existing and future negative impacts to our supply chain and take
actions in an effort to mitigate such impacts. Due to the speed with which the
COVID-19 situation is developing, the global breadth of its spread and the range
of governmental and community reactions thereto, there is uncertainty around its
duration and ultimate impact; therefore, any negative impact on our overall
financial and operating results (including without limitation our liquidity)
cannot be reasonably estimated at this time, but the pandemic could lead to
extended disruption of economic activity and the impact on our financial and
operating results could be material.



Critical Accounting Policies



Our discussion and analysis of our financial condition and results of operations
are based on our consolidated financial statements, which have been prepared in
accordance with U.S. generally accepted accounting principles. Preparing these
financial statements requires us to make estimates and judgments that affect the
reported amounts of assets, liabilities, revenues, and expenses. On an ongoing
basis, we evaluate our estimates for reasonableness as changes occur in our
business environment. We base our estimates on experience, the use of
independent third-party specialists, and various other assumptions that are
believed to be reasonable under the circumstances, the results of which form the
basis for making judgments about the carrying values of assets and liabilities
that are not readily apparent from other sources. Accordingly, actual results
may differ from these estimates under different assumptions or conditions.



Critical accounting policies are those that reflect significant judgments,
estimates, and uncertainties, and potentially result in materially different
results under different assumptions and conditions. We believe the following are
our critical accounting policies:



Basis of Presentation



The accompanying consolidated financial statements have been prepared in
conformity with US GAAP. The basis of accounting differs from that used in the
statutory accounts of the Company, which are prepared in accordance with the
accounting principles of the PRC ("PRC GAAP"). The differences between US GAAP
and PRC GAAP have been adjusted in these consolidated financial statements. The
Company's functional currency is the Chinese Renminbi ("RMB") and Singapore
dollar("SGD"); however, the accompanying consolidated financial statements have
been translated and presented in United States Dollars ("USD").



                                       33





Principles of Consolidation



The consolidated financial statements include the financial statements of the
Company, its subsidiaries and consolidated VIE, including the VIE' subsidiaries,
for which Muliang Viagoo is the primary beneficiary.

All transactions and balances among the Company, its subsidiaries, the VIE and the VIE' subsidiaries have been eliminated upon consolidation.





As PRC laws and regulations welcome to invest in organic fertilizer industry
businesses, Muliang Viagoo operates its fertilizer business in the PRC through
Muliang Industry and its subsidiaries, which are collectively referred as the
"WFOEs".



By entering into a series of agreements (the "VIE Agreements"), Muliang Viagoo,
through WFOEs, obtained control over Muliang Industry and its subsidiaries
(collectively referred as "VIE"). The VIE Agreements enable Muliang Viagoo to
(1) have power to direct the activities that most significantly affect the
economic performance of the VIE, and (2) receive the economic benefits of the
VIE that could be significant to the VIE. Accordingly, Muliang Viagoo is
considered the primary beneficiary of the VIE and has consolidated the VIE'
financial results of operations, assets and liabilities in Muliang Viagoo's
consolidated financial statements. In making the conclusion that Muliang Viagoo
is the primary beneficiary of the VIE, Muliang Viagoo's rights under the Power
of Attorney also provide Muliang Viagoo's abilities to direct the activities
that most significantly impact the VIE' economic performance. Muliang Viagoo
also believes that this ability to exercise control ensures that the VIE will
continue to execute and renew the Master Exclusive Service Agreement and pay
service fees to Muliang Viagoo. By charging service fees to be determined and
adjusted at the sole discretion of Muliang Viagoo, and by ensuring that the
Master Exclusive Service Agreement is executed and remains effective, Muliang
Viagoo has the rights to receive substantially all of the economic benefits

from
the VIE.

Details of the VIE financials, are set forth below:





                                          As of             As of
                                        March 31,       December 31,
                                           2022             2021

Current assets                         $ 18,739,702     $  18,972,383
Non-current assets                        8,846,612         8,995,363
Total Assets                             27,586,314        27,967,746
Current liabilities                      12,230,072        12,794,076
Non-current liabilities                     152,821           422,480
Total liabilities                        12,382,893        13,216,556

Total shareholders' equity (deficit) $ 15,203,421 $ 14,751,190






                                                         For three months ended
                                                                March 31,
                                                          2022            2021
Net income                                             $   412,526     $   359,484

Net cash provided by (used in) operating activities 261,920 1,007,986 Net cash provided by (used in) investment activities

             -

-

Net cash provided by (used in) financing activities $ (265,213 ) $ 14,251






                                       34

VIE Agreements that were entered to give Muliang Viagoo effective control over the VIE include:

Voting Rights Proxy Agreement and Irrevocable Power of Attorney





Under which each shareholder of the VIE grant to any person designated by WFOEs
to act as its attorney-in-fact to exercise all shareholder rights under PRC law
and the relevant articles of association, including but not limited to,
appointing directors, supervisors and officers of the VIE as well as the right
to sell, transfer, pledge and dispose all or a portion of the equity interest
held by such shareholders of the VIE. The proxy and power of attorney agreements
will remain effective as long as WFOEs exist. The shareholders of the VIE do not
have the right to terminate the proxy agreements or revoke the appointment of
the attorney-in-fact without written consent of the WFOEs.



Exclusive Option Agreement



Under which each shareholder of the VIE granted 9F or any third party designated
by 9F the exclusive and irrevocable right to purchase from such shareholders of
the VIE, to the extent permitted by PRC law and regulations, all or part of
their respective equity interests in the VIE for a purchase price equal to the
registered capital. The shareholders of the VIE will then return the purchase
price to 9F or any third party designated by 9F after the option is exercised.
9F may transfer all or part of its option to a third party at its own option.
The VIE and its shareholders agree that without prior written consent of 9F,
they may not transfer or otherwise dispose the equity interests or declare any
dividends. The restated option agreement will remain effective until 9F or any
third party designated by 9F acquires all equity interest of the VIE.



Spousal Consent



The spouse of each shareholder of the VIE has entered into a spousal consent
letter to acknowledge that he or she consents to the disposition of the equity
interests held by his or her spouse in the VIE in accordance with the exclusive
option agreement, the power of attorney and the equity pledge agreement
regarding VIE structure described above, and any other supplemental
agreement(s) may be consented by his or her spouse from time to time. Each such
spouse further agrees that he or she will not take any action or raise any claim
to interfere with the arrangements contemplated under the mentioned agreements.
In addition, each such spouse further acknowledges that any right or interest in
the equity interests held by his or her spouse in the VIE do not constitute
property jointly owned with his or her spouse and each such spouse
unconditionally and irrevocably waives any right or interest in such equity

interests.



Loan Agreement



Pursuant to the loan agreements between WFOEs and each shareholder of the VIE,
WFOEs extended loans to the shareholders of the VIE, who had contributed the
loan principal to the VIE as registered capital. The shareholders of VIE may
repay the loans only by transferring their respective equity interests in VIE to
9F Inc. or its designated person(s) pursuant to the exclusive option agreements.
These loan agreements will remain effective until the date of full performance
by the parties of their respective obligations thereunder.

VIE Agreements that enables Muliang Viagoo to receive substantially all of the economic benefits from the VIE include:

Equity Interest Pledge Agreement





Pursuant to equity interest pledge agreement, each shareholder of the VIE has
pledged all of his or her equity interest held in the VIE to WFOEs to secure the
performance by VIE and their shareholders of their respective obligations under
the contractual arrangements, including the payments due to WFOEs for services
provided. In the event that the VIE breach any obligations under these
agreements, WFOEs as the pledgees, will be entitled to request immediate
disposal of the pledged equity interests and have priority to be compensated by
the proceeds from the disposal of the pledged equity interests. The shareholders
of the VIE shall not transfer their equity interests or create or permit to be
created any pledges without the prior written consent of WFOEs. The equity
interest pledge agreement will remain valid until the master exclusive service
agreement and the relevant exclusive option agreements and proxy and power of
attorney agreements, expire or terminate.

Master Exclusive Service Agreement


Pursuant to exclusive service agreement, WFOEs have the exclusive right to
provide the VIE with technical support, consulting services and other services.
WFOEs shall exclusively own any intellectual property arising from the
performance of the agreement. During the term of this agreement, the VIE may not
accept any services covered by this agreement provided by any third party. The
VIE agree to pay service fees to be determined and adjusted at the sole
discretion of the WFOEs. The agreement will remain effective unless WFOEs
terminate the agreement in writing.



                                       35

Risks in relation to the VIE structure

Muliang Viagoo believes that the contractual arrangements with the VIE and their
current shareholders are in compliance with PRC laws and regulations and are
legally enforceable. However, uncertainties in the PRC legal system could limit
Muliang Viagoo's ability to enforce the contractual arrangements. If the legal
structure and contractual arrangements were found to be in violation of PRC laws
and regulations, the PRC government could:



  ? Revoke the business and operating licenses of Muliang Viagoo's PRC
    subsidiaries or consolidated affiliated entities;

? Discontinue or restrict the operations of any related-party transactions among

Muliang Viagoo's PRC subsidiaries or consolidated affiliated entities;

? Impose fines or other requirements on Muliang Viagoo's PRC subsidiaries or


    consolidated affiliated entities;

? Require Muliang Viagoo's PRC subsidiaries or consolidated affiliated entities

to revise the relevant ownership structure or restructure operations; and/or;

? Restrict or prohibit Muliang Viagoo's use of the proceeds of the additional

public offering to finance Muliang Viagoo's business and operations in China;






  ? Shut down Muliang Viagoo's servers or blocking Muliang Viagoo's online
    platform;

? Discontinue or place restrictions or onerous conditions on Muliang Viagoo's


    operations; and/or

? Require Muliang Viagoo to undergo a costly and disruptive restructuring.

Muliang Viagoo's ability to conduct its business may be negatively affected if
the PRC government were to carry out any of the aforementioned actions. As a
result, Muliang Viagoo may not be able to consolidate the VIE in its
consolidated financial statements as it may lose the ability to exert effective
control over the VIE and its shareholders, and it may lose the ability to
receive economic benefits from the VIE. Muliang Viagoo currently does not
believe that any penalties imposed or actions taken by the PRC government would
result in the liquidation of the Company, WFOEs, or the VIE.



The following table sets forth the assets, liabilities, results of operations
and cash flows of the VIE and their subsidiaries, which are included in Muliang
Viagoo's consolidated financial statements after the elimination of intercompany
balances and transactions:



Under the VIE Arrangements, Muliang Viagoo has the power to direct activities of
the VIE and can have assets transferred out of the VIE. Therefore, Muliang
Viagoo considers that there is no asset in the VIE that can be used only to
settle obligations of the VIE, except for assets that correspond to the amount
of the registered capital and PRC statutory reserves, if any. As the VIE are
incorporated as limited liability companies under the Company Law of the PRC,
creditors of the VIE do not have recourse to the general credit of Muliang
Viagoo for any of the liabilities of the VIE.



Currently there is no contractual arrangement which requires Muliang Viagoo to
provide additional financial support to the VIE. However, as Muliang Viagoo
conducts its businesses primarily based on the licenses held by the VIE, Muliang
Viagoo has provided and will continue to provide financial support to the VIE.



Revenue-producing assets held by the VIE include certain internet content
provision ("ICP") licenses and other licenses, domain names and trademarks. The
ICP licenses and other licenses are required under relevant PRC laws, rules and
regulations for the operation of internet businesses in the PRC, and therefore
are integral to Muliang Viagoo's operations. The ICP licenses require that core
PRC trademark registrations and domain names are held by the VIE that provide
the relevant services.



                                       36





Muliang Viagoo consolidates the following entities, including wholly-owned
subsidiaries, Muliang HK, Shanghai Mufeng, Viagoo, and its wholly controlled
variable interest entities, Muliang Industry, and Zhongbao, 60% controlled
Agritech Development, 99% controlled Fukang, 65% controlled Zhonglian, 80%
controlled Yunnan Muliang and 51% controlled Heilongjiang. Accordingly, the 40%
equity interest holder of Agritech Development, 1% equity interest holders in
Fukang, 35% equity interest holders in Zhonglian, 20% interest in Yunnan
Muliang, and 49% equity interest in Heilongjiang are accounted as
non-controlling interest in the Company's consolidated financial statements.



The variable interest entities consolidated for which the Company is deemed the
primary beneficiary. All significant inter-company accounts and transactions
have been eliminated in consolidation.



Use of Estimates




In preparing financial statements in conformity with U.S. GAAP, management makes
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities at the dates of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Significant estimates required by management
include the recoverability of long-lived assets and the valuation of
inventories. Accordingly, actual results could differ from those estimates.




Accounts Receivable



We state accounts receivable at cost, net of allowance for doubtful accounts.
Based on our experience and current practice in the PRC, management provides a
100% allowance for doubtful accounts equivalent to those not collected within
one year and 50% for receivables outstanding for longer than six months.
Management believes that the current bad debt allowance adequately reflects an
appropriate estimate based on management's judgment.



Inventory Valuation



We value our fertilizer inventories at the lower of cost, determined on a
weighted average basis, and net realizable value (the estimated market price).
Substantially all inventory expenses, packaging, and supplies are valued by

the
weighted average method.



Revenue Recognition



On January 1, 2018, the Company adopted ASC 606 using the modified retrospective
method. Results for the reporting period beginning after January 1, 2018, are
presented under ASC 606, while prior period amounts have not been adjusted and
continue to be reported in accordance with the Company's historic accounting
under Topic 605.

Management has determined that the adoption of ASC 606 did not impact the Company's previously reported financial statements in any prior period, nor did it result in a cumulative-effect adjustment to opening retained earnings.





                                       37






Revenue for the sale of products is derived from contracts with customers, which
primarily include the sale of fertilizer products and environmental protection
equipment. The Company's sales arrangements do not contain variable
considerations. The Company recognizes revenue at a point in time based on
management's evaluation of when performance obligations under the terms of a
contract with the customer are satisfied and control of the products has been
transferred to the customer. For vast majority of the Company's product sales,
the performance obligations and control of the products transfer to the customer
when products are delivered, and customer acceptance is made.



Revenue for logistics-related services is derived from Viagoo subsidiaries.
Through an online service platform, the company provides the operation
management service to support customers. For VTM service, revenue is charged to
carriers based on a certain percentage of the freight charges. For VES service,
revenue is recognized based on monthly subscriptions by vehicles and by users.
For system integration service, revenue is recognized over time based on the
progress of the project and annual maintenance service.



Pursuant to the guidance of ASC Topic 840, rent shall be reported as income by
lessors over the lease term as it becomes receivable. The Company currently
leased part of the building of the Shanghai new plant to third parties as a
warehouse. Accordingly, the Company recognizes building leasing revenue over the
beneficial period described by the agreement, as the revenue is realized or

realizable and earned.



Income Taxes



The Company accounts for income taxes under the provision of FASB ASC 740-10,
which requires the recognition of deferred tax assets and liabilities for the
expected future tax consequences of events that have been included in the
financial statements or tax returns. Under this method, deferred income taxes
are recognized for the tax consequences in future years of differences between
the tax bases of assets and liabilities and their financial reporting amounts at
each period end based on enacted tax laws and statutory tax rates applicable to
the periods in which the differences are expected to affect taxable income.
Valuation allowances are established, when necessary, to reduce deferred tax
assets to the amount expected to be realized.



New Accounting Standards



In February 2016, the FASB issued Accounting Standards Update No. 2016-02 (ASU
2016-02) "Leases (Topic 842)". ASU 2016-02 requires a lessee to recognize in the
statement of financial position a liability to make lease payments (the lease
liability) and a right-of-use asset representing its right to use the underlying
asset for the lease term. ASU 2016-02 is effective for interim and annual
reporting periods beginning after December 15, 2018. Early adoption is
permitted. For finance leases, a lessee is required to do the following:

? Recognize a right-of-use asset and a lease liability, initially measured at

the present value of the lease payments, in the statement of financial

position

? Recognize interest on the lease liability separately from amortization of the

right-of-use asset in the statement of comprehensive income

? Classify repayments of the principal portion of the lease liability within

financing activities and payments of interest on the lease liability and

variable lease payments within operating activities in the statement of cash


    flows.

For operating leases, a lessee is required to do the following:

? Recognize a right-of-use asset and a lease liability, initially measured at

the present value of the lease payments, in the statement of financial

position

? Recognize a single lease cost, calculated so that the cost of the lease is

allocated over the lease term on a generally straight-line basis

? Classify all cash payments within operating activities in the statement of


    cash flows.




                                       38






In July 2018, the FASB issued Accounting Standards Update No. 2018-11 (ASU
2018-11), which amends ASC 842 so that entities may elect not to recast their
comparative periods in transition (the "Comparatives Under 840 Option"). ASU
2018-11 allows entities to change their date of initial application to the
beginning of the period of adoption. In doing so, entities would:



  ? Apply ASC 840 in the comparative periods.

? Provide the disclosures required by ASC 840 for all periods that continue to

be presented in accordance with ASC 840.

? Recognize the effects of applying ASC 842 as a cumulative-effect adjustment to


    retained earnings for the period of adoption.




In addition, the FASB also issued a series of amendments to ASU 2016-02 that
address the transition methods available and clarify the guidance for lessor
costs and other aspects of the new lease standard.

The management has reviewed the accounting pronouncements and adopted the new standard on January 1, 2019, using the modified retrospective method of adoption.





In December 2019, the FASB issued ASU 2019-12 - Income Taxes (Topic 740):
Simplifying the Accounting for Income Taxes. This ASU provides an exception to
the general methodology for calculating income taxes in an interim period when a
year-to-date loss exceeds the anticipated loss for the year. This update also
(1) requires an entity to recognize a franchise tax (or similar tax) that is
partially based on income as an income-based tax and account for any incremental
amount incurred as a non-income-based tax, (2) requires an entity to evaluate
when a step-up in the tax basis of goodwill should be considered part of the
business combination in which goodwill was originally recognized for accounting
purposes and when it should be considered a separate transaction, and (3)
requires that an entity reflect the effect of an enacted change in tax laws or
rates in the annual effective tax rate computation in the interim period that
includes the enactment date. The standard is effective for the Company for
fiscal years beginning after December 15, 2020, with early adoption permitted.
The Company is currently in the process of evaluating the impact of the adoption
on its consolidated financial statements.



In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement (Topic
820), - Disclosure Framework - Changes to the Disclosure Requirements for Fair
Value Measurement," which makes a number of changes meant to add, modify or
remove certain disclosure requirements associated with the movement amongst or
hierarchy associated with Level 1, Level 2 and Level 3 fair value measurements.
The amendments in this Update modify the disclosure requirements on fair value
measurements based on the concepts in FASB Concepts Statement, Conceptual
Framework for Financial Reporting-Chapter 8: Notes to Financial Statements,
including the consideration of costs and benefits. The amendments on changes in
unrealized gains and losses, the range and weighted average of significant
unobservable inputs used to develop Level 3 fair value measurements, and the
narrative description of measurement uncertainty should be applied prospectively
for only the most recent interim or annual period presented in the initial
fiscal year of adoption. All other amendments should be applied retrospectively
to all periods presented upon their effective date. The amendments are effective
for all entities for fiscal years beginning after December 15, 2019, and interim
periods within those fiscal years, with early adoption permitted. The Company is
currently evaluating the potential impacts of ASU 2018-13 on its consolidated
financial statements.



In February 2020, the FASB issued ASU 2020-02, "Financial Instruments - Credit
Losses (Topic 326) and Leases (topic 842) Amendments to SEC Paragraphs Pursuant
to SEC Staff Accounting Bulletin No. 119 and Update to SEC Section on Effective
Date Related to Accounting Standards Update No. 2016-02, Leases (topic 842)".
This ASU provides guidance regarding methodologies, documentation, and internal
controls related to expected credit losses. This ASU is effective for interim
and annual periods beginning after December 15, 2019, and early adoption is
permitted. The Company is evaluating the impact of this guidance on its
consolidated financial statements.



The Company believes that no other accounting standards were recently issued
that had or are expected to have a material impact on our financial position or
results of operations.



Results of Operations

We are principally engaged in the organic fertilizer manufacture and distribution business in the PRC, which account for 67.2% of our total revenue for the three months ended March 31, 2022.


As a result of the COVID-19 outbreak in December 2019 and continuing in the year
of 2020, the Company's businesses, results of operations, financial position and
cash flows were adversely affected in 2020. However, the COVID-19 was under
control for the three months ended March 31, 2022 in China. And we are growing
our revenue steadily currently and will keep growing through 2022.



                                       39

Results of Operations for the Three Months Ended March 31, 2022 and 2021





                                               Three Months Ended
                                                    March 31,
                                              2022            2021          Fluctuation
                                                $               $                $               %
Revenues-fertilizer                          1,545,208       1,384,814     

     160,394          11.6 %
Reveues-logistic                               754,867         184,154           570,713         309.9 %
Reveues-others                                       -             119              (119 )      -100.0 %

Subtoal of revenue                           2,300,075       1,569,087     

     730,988          46.6 %
Cost-fertilizer                                871,690         803,229            68,461           8.5 %
Cost- logistic                                 318,582          97,523           221,059         226.7 %
Cost- others                                         -              89               (89 )      -100.0 %
Subtotal of cost                             1,190,272         900,841           289,431          32.1 %
Gross profit                                 1,109,803         668,246           441,557          66.1 %
Gross margin                                     48.25 %         42.59 %
Operating expenses:
General and administrative expenses            689,571         328,692     

     360,879         109.8 %
Selling expenses                                37,608          71,520           (33,912 )       -47.4 %
Total operating expenses                       727,179         400,212           326,967          81.7 %
Income(loss) from operations                   382,624         268,034           114,590          42.8 %
Other income (expense):
Interest expense                               (43,267 )       (16,838 )         (26,429 )       157.0 %
Other income (expense), net                     23,758           9,308            14,450         155.2 %
Total other income (expense)                   (19,509 )        (7,530 )         (11,979 )       159.1 %
Income before income taxes                     363,115         260,504           102,611          39.4 %
Income taxes                                     5,466               -             5,466           N/A
Net income (loss)                              357,649         260,504            97,145          37.3 %




Revenue




Total revenue for fertilizer increased from $1,384,814 for the three months
ended March 31, 2021, to $1,545,208 for the three months ended March 31, 2021,
which represented an increase of $160,394, or approximately 11.6%. The increase
in revenue was mainly due to the restoring confidence in the future economic
growth for most of our customers. Traditionally, we experience some seasonality
in our sales. We tend to sell more fertilizer products in the second half of the
year. Additionally, there has been a general recovery in the economy after the
height of the pandemic. We expect to see a trend of improving sales as the
epidemic moves further into the past.



Our revenue for logistic also increased from $184,154 for the three months ended
March 31, 2021, to $754,867 for the three months ended March 31, 2021, which
represented an increase of $570,713, or approximately 309.9%.



Cost of sales



Cost of sales for fertilizer increased from $803,229 for the three months ended
March 31, 2021, to $871,690 for the three months ended March 31, 2022, which
represented an increase of approximately $68,461, or 8.5%. The increase in the
cost of revenue for fertilizer was in line with the increase in revenue.



Cost of sales for logistic increased from $97,523 for the three months ended
March 31, 2021, to $318,582 for the three months ended March 31, 2022, which
represented an increase of approximately $221,059, or 226.7%. The increase in
the cost of revenue for logistic was in line with the increase in revenue.




                                       40





Gross profit



The gross profit for fertilizer increased from $581,585 for the three months
ended March 31, 2021, to a gross profit of $673,518 for the three months ended
March 31, 2022. And the gross margin for fertilizer slightly increased from
42.0% for the three months ended March 31, 2021, to 43.6% for the three months
ended March 31, 2022.




The gross profit for logistic significantly increased from $86,631 for the three
months ended March 31, 2021, to a gross profit of $436,285 for the three months
ended March 31, 2022. And the gross margin for logistic increased from 47.0% for
the three months ended March 31, 2021, to 57.8% for the three months ended
March
31, 2022



Expenses



We incurred $37,608 in selling expenses for the three months ended March 31,
2022, compared to $71,520 for the three months ended March 31, 2021. We incurred
$689,571 in general and administrative expenses for the three months ended March
31, 2022, compared to $328,692 for the three months ended March 31, 2021. Total
selling, general and administrative expenses increased by $326,967, or 81.7% for
the three months ended March 31, 2022, as compared to the same period in 2021.
Our selling expenses decreased by $33,912, and our general and administrative
expenses increased by $360,879. We expect our general and administrative
expenses to increase in the near future if we successfully complete our public
offering.



Interest income (expense)




We incurred $43,267 in interest expense during the three months ended March 31,
2022, compared with interest expense of $16,838 for the three months ended
March
31, 2021.



Net income

Our net income was $357,649 for the three months ended March 31, 2022, compared with a net income of $260,504 for the three months ended March 31, 2021, representing an increase of $97,145.

Liquidity and Capital Resources





Liquidity is the ability of a company to generate funds to support its current
and future operations, satisfy its obligations and otherwise operate on a going
concern basis. At March 31, 2022 and December 31, 2021 our net current assets
(working capital) were $6,007,632 and $5,403,720, respectively.

We have financed our operations over the three months ended March 31, 2022 and 2021 primarily through proceeds from net cash inflow from operations.

The components of cash flows are discussed below:





                                                         Three Months Ended
                                                              March 31,
                                                         2022           2021

Net cash provided by (used in) operating activities $ 28,794 $ 904,657 Net cash provided by (used in) investing activities

            -

-


Net cash used in financing activities                   (265,213 )      (19,879 )
Exchange rate effect on cash                             234,094       (25,158)
Net cash inflow (outflow)                             $   (2,325 )   $  859,620




                                       41

Cash Provided by Operating Activities


Net cash provided by operating activities was $28,794 for the three months ended
March 31, 2022. The net cash inflow consisted primarily of net income of
$357,649, depreciation and amortization of $164,556, a decrease of $1,770,405 in
account receivable, a bad debt provision of $358,551, which were offset by an
increase of $1,675,200 in prepayment, a decrease of $483,260 in accounts payable
and accrued payables, and a decrease of $362,096 in other payable.



Net cash provided by operating activities was $904,657 for the three months
ended March 31, 2021. The net cash inflow consisted primarily of net income of
$260,504, depreciation and amortization of $132,737, a decrease of $4,404,317 in
account receivable, an increase of $354,191 in other payable, a decrease of
$187,446 in prepayment, which were offset by a decrease of $4,290,253 in
Accounts payable and accrued payables, an increase of $18,521 in inventory.

Cash used in Investing Activities

There is no cash flow in investing activities for the three months ended March 31, 2021 and 2020.

Cash Used in Financing Activities





Net cash used in financing activities was $265,213 for the three months ended
March 31, 2022. During the period, cash used in financing activities mainly
consisted of the repayment to related parties of $273,426 and offset by proceeds
from short-term loan of $ 8,213.

Net cash used in financing activities was $19,879 for the three months ended March 31, 2021. During the period, cash used in financing activities mainly consisted of the proceeds from related parties of $16,547, and repayment of short-term loan of $36,426.





We anticipate that our current cash reserves plus cash from our operating
activities will not be sufficient to meet our ongoing obligations and fund our
operations for the next twelve months. As a result, we will need to seek
additional funding in the near future. We currently do not have a specific plan
of how we will obtain such funding; however, we anticipate that additional
funding will be in the form of equity financing from the sale of shares of our
common stock or renewing our current obligations with lenders. We may also seek
to obtain short-term loans from our directors or unrelated parties. Additional
funding may not be available, or at acceptable terms, to us at this time. If we
are unable to obtain additional financing, we may be required to reduce the
scope of our business development activities, which could harm our business
plans, financial condition and operating results.

Contractual Commitments and Commitments for Capital Expenditure





Contractual Commitments



The following table summarizes our contractual obligations at March 31, 2022 and
the effect those obligations are expected to have on our liquidity and cash

flow
in future periods.



                                     Payments Due by Period as of March 31, 2022
                                           Less than        2 - 3       4 - 5        Over
                             Total          1 Year          Years       Years       5 Years
Contractual obligations
Loans                     $ 1,188,937     $ 1,170,803     $ 18,134,     $    -     $       -
Others                              -               -             -          -             -
                          $ 1,188,937     $ 1,170,803     $  18,134     $    -     $       -




                                       42

Commitments for Capital Expenditure

There were no non-cancelable commitments for capital expenditure as of March 31, 2022.





Off Balance Sheet Items



We do not have any off-balance sheet arrangements that we are required to
disclose pursuant to these regulations. In the ordinary course of business, we
enter into operating lease commitments, purchase commitments and other
contractual obligations. These transactions are recognized in our financial
statements in accordance with generally accepted accounting principles in the
United States.

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