The following information should be read in conjunction with (i) the financial
statements of New Momentum Corporation, a Nevada corporation (the "Company"),
and the notes thereto appearing elsewhere in this Form 10-Q together with (ii)
the more detailed business information and the December 31, 2019 audited
financial statements and related notes included in the Company's Form 10-K (File
No. 000-52273; the "Form 10-K"), as filed with the Securities and Exchange
Commission on March 30, 2020. Statements in this section and elsewhere in this
Form 10-Q that are not statements of historical or current fact constitute
"forward-looking" statements.
OVERVIEW
The Company was incorporated in the State of Nevada on July 1, 1999, and
established a fiscal year end of December 31.
Going Concern
To date the Company has little operations or revenues and consequently has
incurred recurring losses from operations. No revenues are anticipated until we
complete the financing we endeavor to obtain, as described in the Form 10-K, and
implement our initial business plan. The ability of the Company to continue as a
going concern is dependent on raising capital to fund our business plan and
ultimately to attain profitable operations. Accordingly, these factors raise
substantial doubt as to the Company's ability to continue as a going concern.
Our activities have been financed from related-party loans and the proceeds of
share subscriptions. During October 2015, the Company raised a total of $300,500
in cash from offerings of our common stock. We have no outstanding loans.
The Company plans to raise additional funds through debt or equity offerings.
There is no guarantee that the Company will be able to raise any capital through
this or any other offerings.
PLAN OF OPERATION
We are an early stage corporation and have generated revenues of $5,872 from our
business during the nine months ended September 30, 2020. We have developed and
operate an online ticketing platform named Gagfare.com, which provides a
ticketing system for individuals and agencies to search, book and issue flight
tickets and other services. During the 12 months following the date of filing of
this Quarterly Report on Form 10-Q, will be focused on attempting to raise
$750,000 of funds to expand our business. We have no assurance that future
financing will materialize. If that financing is not available, we may be unable
to continue. Management believes that if we are successful in raiding $750,000,
we will be able to generate sales revenue within the following twelve months
thereof. However, if such public financing is not available, we could fail to
satisfy our future cash requirements. We have no assurance that future financing
will materialize. If that financing is not available we may be unable to
continue. Management believes that if subsequent private placements are
successful, we will be able to generate sales revenue within the following
twelve months thereof. However, additional equity financing may not be available
to us on acceptable terms or at all, and thus we could fail to satisfy our
future cash requirements.
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If we are unsuccessful in raising the additional proceeds through a private
placement offering we will then have to seek additional funds through debt
financing, which would be highly difficult for an early-stage company to secure.
Therefore, the Company is highly dependent upon the success of the anticipated
private placement offering and failure thereof would result in the Company
having to seek capital from other sources such as debt financing, which may not
even be available to the Company. However, if such financing were available,
because we are an early stage company, it would likely have to pay additional
costs associated with high risk loans and be subject to an above market interest
rate. At such time these funds are required, management would evaluate the terms
of such debt financing and determine whether the business could sustain
operations and growth and manage the debt load. If we cannot raise additional
proceeds via a private placement of its common stock or secure debt financing it
would be required to cease business operations. As a result, investors in our
common stock would lose all of their investment.
With new investors joining, the Company will develop a travel services
businesses, which includes an online ticketing platform Gagfare, which provides
to travelers a "Book Now, Pay Later" business model, for travelers to secure the
best fares and reserve flights well ahead of time. The Company will also become
the driving force behind a bold new hospitality concept that takes nature lovers
and intrepid travelers to exciting new and established destinations. The curated
collection of boutique properties, each with a focus on diving, sustainability,
conservation, and cultural authenticity, offers a thoroughly contemporary travel
experience that is intrinsically linked to the destination, its heritage and its
culture.
RESULTS OF OPERATIONS
Comparison of the three months ended September 30, 2020 and 2019
As of September 30, 2020, we suffered from a working capital deficit of
$108,530. As a result, our continuation as a going concern is dependent upon
improving our profitability and the continuing financial support from our
stockholders or other capital sources. Management believes that the continuing
financial support from the existing shareholders and external financing will
provide the additional cash to meet our obligations as they become due. Our
financial statements do not include any adjustments to reflect the possible
future effects on the recoverability and classification of assets and
liabilities that may result in the Company not being able to continue as a going
concern.
The following table sets forth certain operational data for the three months
ended September 30, 2020 and 2019:
Three Months Ended September 30,
2020 2019
Revenues $ 5,872 $ 44
Cost of revenue (5,214 ) -
Gross profit 658 44
Total operating expenses (13,414 ) (4,347 )
Other income 1 1
Loss before Income Taxes (12,755 ) (4,302 )
Income tax expense - -
Net loss (12,755 ) (4,302 )
Revenue. We generated revenues of $5,872 and $44 for the three months ended
September 30, 2020 and 2019. The significant increase is due to the increase in
business volume in booking services.
Cost of Revenue. Cost of revenue for the three months ended September 30, 2020,
was $5,214. Cost of revenue increased primarily as a result of the increase in
our business volume.
Gross Profit. We achieved a gross profit of $658 and $44 for the three months
ended September 30, 2020 and 2019, respectively. The increase in gross profit is
primarily attributable to the increase in our business volume.
General and Administrative Expenses ("G&A"). We incurred G&A expenses of $13,414
and $4,347 for the three months ended September 30, 2020 and 2019, respectively.
The increase in G&A is primarily attributable to the increase in our business
volume.
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Income Tax Expense. Our income tax expenses for the quarters ended September 30,
2020 and 2019 were $0.
Net Loss. During the three months ended September 30, 2020, we incurred a net
loss of $12,755, as compared to $4,302 for the same period ended September 30,
2019.
Comparison of the nine months ended September 30, 2020 and 2019
The following table sets forth certain operational data for the nine months
ended September 30, 2020 and 2019:
Nine Months Ended September 30,
2020 2019
Revenues $ 16,202 $ 315
Cost of revenue (5,214 ) -
Gross profit 10,988 315
Total operating expenses (33,773 ) (20,889 )
Other income 1 4
Loss before Income Taxes (22,782 ) (20,570 )
Income tax expense - -
Net loss (22,782 ) (20,570 )
Revenue. We generated revenues of $16,202 and $315 for the nine months ended
September 30, 2020 and 2019.
Cost of Revenue. Cost of revenue for the nine months ended September 30, 2020,
was $5,214. Cost of revenue increased primarily as a result of the increase in
our business volume.
Gross Profit. We achieved a gross profit of $10,988 and $315 for the nine months
ended September 30, 2020 and 2019, respectively. The increase in gross profit is
primarily attributable to the increase in our business volume.
General and Administrative Expenses ("G&A"). We incurred G&A expenses of $16,131
and $20,889 for the nine months ended September 30, 2020, and 2019,
respectively. The increase in G&A is primarily attributable to the increase in
our business volume.
Income Tax Expense. Our income tax expenses for the nine months ended September
30, 2020 and 2019 were $0.
Net Loss. During the nine months ended September 30, 2020, we incurred a net
loss of $22,782, as compared to $20,570 for the same period ended September 30,
2019.
Liquidity and Capital Resources
As of September 30, 2020, we had cash and cash equivalents of $34,067, accounts
receivable of $6,163, deposits, prepayments and other receivables of $11,778.
We believe that our current cash and other sources of liquidity discussed below
are adequate to support general operations for at least the next 12 months.
Nine Months Ended September
30,
2020 2019
Net cash provided used in operating activities $ (20,171 ) $ (14,803 )
Net cash provided by (used in) investing activities - -
Net cash provided by financing activities 45,061 15,443
Net Cash Used In Operating Activities.
For the nine months ended September 30, 2020, net cash used in operating
activities was $20,171, which consisted primarily of a net loss of $22,782,
offset by an decrease in accounts receivables of $5,660, a decrease in deposits,
prepayments and other receivables of $307 and an increase in accrued expenses
and other payables of $8,578.
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For the nine months ended September 30, 2019, net cash used in operating
activities was $14,803, which consisted primarily of a net loss of $20,570,
non-cash items, offset by an increase in accounts receivables of $4,238, an
increase in deposits, prepayments and other receivables of $7,447 and a decrease
in accrued expenses and other payable of $5,916.
We expect to continue to rely on cash generated through financing from our
existing shareholders and private placements of our securities, however, to
finance our operations and future acquisitions.
Net Cash Provided By Investing Activities.
For the nine months ended September 30, 2020, there is no net cash provided by
investing activities.
For the nine months ended September 30, 2019, there is no net cash provided by
investing activities.
Net Cash Provided By Financing Activities.
For the nine months ended September 30, 2020, net cash provided by financing
activities was $45,061 consisting primarily of $22,840 repayment to related
companies of the Company and offset by $67,901 advances from a director.
For the nine months ended September 30, 2019, net cash provided by financing
activities was $15,443, consisting primarily of $38,589 repayment to related
companies of the Company and offset by $54,032 advances from the Company's
related parties.
Off-Balance Sheet Arrangements
We had no off-balance sheet arrangements for the nine months ended September 30,
2020.
Subsequent Events
None through date of this filing.
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