Forward-Looking Statements

Certain statements, other than purely historical information, including estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified by the words, "believes," "project," "expects," "anticipates," "estimates," "intends," "strategy," "plan," "may," "will," "would," "will be," "will continue," "will likely result," and similar expressions. We intend such forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement for purposes of complying with those safe-harbor provisions. Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on our operations and future prospects include, but are not limited to: changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.





Company Overview

We share the same business plan as that of our subsidiaries and we also act as a holding company for our subsidiaries. Through Next Meats Co., Ltd., Next Meats USA, Inc., Next Meats HK Co. Limited, Next Meats (S) Pte. Ltd., we develop and sell alternative meat products, with ingredients derived from predominantly, plant based materials.

At present, our principal focus is on the creation of plant-based food products to replace traditional animal products, while retaining the taste and texture of the original.





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  Table of Contents

Assets

As of January 31, 2023, we had cash and cash equivalents of $62,222. As of April 30, 2022, we had cash and cash equivalents of $620,297. We believe that our cash and cash equivalents are less as of January 31, 2023, when compared to April 30, 2022, because our revenues have decreased since April 30, 2022, resulting in less available cash on hand. We believe this primarily results from our decision to no longer wholesale rice, coupled with what we believe to be a global downtrend in consumer spending. Information regarding our revenue is detailed below in the section titled, "Revenue".

Our total current assets were $2,515,286 as of January 31, 2023, and $3,842,764 as of April 30, 2022. As of January 31, 2023 we had $165,897 in short terms loans receivable, compared to none as of April 30, 2022. As of January 31, 2023, we had $1,304,071 in advance payments and prepaid expenses, compared to $1,335,832 as of April 30, 2022. In addition to a decrease in available cash and cash equivalents, we believe a decrease in advance payments was a primary contributor to our lesser current assets as of January 31, 2023 when compared to April 30, 2022.

Our non-current assets were $1,502,555 as of January 31, 2023 and $1,885,836 as of April 30, 2022. As of January 31, 2023, we had fewer non-current assets, when compared to April 30, 2022, which we attribute to various factors which include, but are not limited to, lesser net depreciation, construction in progress, land and improvements, no deferred assets, lesser security deposits, and no stock (invested securities) held.

Our cash balance is likely not sufficient to fund our limited levels of operations for any substantive period of time. In order to implement our plan of operations for the next twelve-month period, we will likely require further funding. We may need to rely on the sale of our common stock or other means to raise capital, should our cash balance be insufficient to further our business agenda. After a twelve-month period we may need additional financing but currently do not have any arrangements for such financing. If we need additional cash and cannot raise it, we will either have to scale back or suspend operations until we do raise the cash we need, or we may need to materially alter our business objectives.





Revenue

For the three-month period ended January 31, 2023 we realized revenues of $221,567, cost of revenues of $209,841 and gross profits of $11,726. For the three-month period ended January 31, 2022 we realized revenues of $1,110,497, cost of revenues of $703,454 and gross profits of $407,043. For the three-month period ended January 31, 2023, when compared to the three-month period ended January 31, 2022, we realized significantly less revenue, cost of revenue, and gross profits over the same period, which we attribute primarily to our decision to stop selling wholesale rice, and what we believe to be a global economic downtrend, but we also believe our gross profit was significantly decreased because we sold our products at decreased prices for the three months ended January 31, 2023.

For the nine-month period ended January 31, 2023 we also realized a dramatic decrease in revenue over the same period for the year prior. For the nine-month period ended January 31, 2023 we realized revenues of $1,092,882, cost of revenues of $977,302 and a gross profit of $115,581. For the nine-month period ended January 31, 2022 we realized revenues of $6,294,577, cost of revenues of $5,778,596 and a gross profit of $515,981.

Globally speaking, many markets, industries, and nations have been affected by rising costs, inflation, and a decreased demand for products. We believe the products we offer, and continue to offer, to be a 'premium' alternative to traditional food options, which typically coincides with increased costs. Given the condition of the global economy, we believe there is likely less demand for premium alternatives to traditional food products, such as those we currently offer. Over the course of the last year, we believe we have been affected by decreased demand for our products, our decision to no longer wholesale rice, and the decreased price at which we have offered our products, resulting in less revenue for the three and nine months ended January 31, 2023.

Previously, we also had a wider selection of food options and other facets of our business which we believe drove revenues. Specifically, from time to time we would engage in the wholesale sale of rice, however we no longer engage in the wholesale sale of rice because our previous sole supplier is no longer in business. We believe that due to the current downtrend in the global economy, that such efforts should not recommence, if at all, until the global economy recovers to pre-pandemic levels.

At this time, we also no longer offer "Next Milk" which we believed would gain popularity in the near term. Various components of the products we offered, or seek to continue to offer, are either not available, or available at price points that are not as attractive. As a result, at this time, it is difficult for us to produce cost effective products that we believe would rival the cost of generic food products, and thus bolster our revenues. We believe many consumers are purchasing more cost-effective options. Because of this, we are exploring means to lessen the cost of our product lineup while maintaining what we believe to be the same quality products, but we cannot forecast with any level of certainty if such efforts will be successful. Much of these endeavors rely on our ability to source ingredients at a lesser cost, which, at this time, is a challenge.

If we need additional cash and cannot raise it, we will either have to scale back or suspend operations until we do raise the cash we need, or we may need to materially alter our business objectives. Given our revenue is not sufficient to cover our operating expenses we have and expect to continue to rely on funding from the sales of our common stock, and or related party contributions by our officers and directors. Our officers and directors however, have no obligations time to loan or provide the company with capital infusions.





Expenses

For the three-month period ended January 31, 2023 we incurred total operating expenses of $327,708, which was comprised of $12,534 in depreciation and $315,174 in general and administrative expenses. For the three-month period ended January 31, 2022 we incurred total operating expenses of $1,619,804, which was comprised of $14,033 in depreciation and $1,605,771 in general and administrative expenses. As a result of, primarily, a significant decrease in general and administrative expenses, our total operating expenses for the three months ended January 31, 2023 have decreased compared to our total operating expenses for the three months ended January 31, 2022.

For the nine-month period ended January 31, 2023 we incurred total operating expenses of $2,078,554, which was comprised of $30,516 in depreciation and $2,048,038 in general and administrative expenses. For the nine-month period ended January 31, 2022 we incurred total operating expenses of $4,019,823, which was comprised of $38,782 in depreciation and $3,981,041 in general and administrative expenses. We also believe that as a result of, primarily, a significant decrease in general and administrative expenses, our total operating expenses for the nine months January 31, 2023 have decreased compared to our total operating expenses for the nine months ended January 31, 2022. In large part, we believe our general and administrative expenses have decreased by such a significant margin because Next Meats Co., Ltd. decreased its staff from approximately 94 employees to 13 employees. The decision to decrease staff is in part due to a general decline in the level of our operations.

Going forward, we believe we may be able to improve our financial condition if we can also consolidate the number of our suppliers. At this time we have various suppliers who create the products we offer for resale.

We intend for Mama Foods Co., Ltd. ("Mama Foods") to handle increased levels of production going forward. For the nine months ended January 31, 2023 Mama Foods was responsible for manufacturing approximately 28.83% of our inventory.

Mama Foods is a food company founded in Japan in 1958, currently offering customers in Japan wholesale and retail products centering on Japanese side dishes, from chilled foods to packed and sterilized food. It is also manufacturer of various food products for third parties.

In 2021, White Knight Co., Ltd., a Japan entity controlled exclusively by Koichi Ishizuka, acquired 100% of Mama Foods Co., Ltd. from its prior controller.

The sole shareholder of Mama Foods is currently White Knight Co., Ltd. Koichi Ishizuka, is Chief Executive Officer, Chief Financial Officer, and Director of Mama Foods Co., Ltd.





Net Loss

For the three months ended January 31, 2023, we incurred a net loss of $89,435, whereas for the three-month period ended January 31, 2022 we incurred a net loss of $1,209,849. For the nine months ended January 31, 2023 we incurred a net loss of $1,818,674, whereas for the nine months ended January 31, 2022, we incurred a net loss of $3,543,229. For both of the aforementioned periods, the variance in net loss is a result of our decreased business activity.





Corporate Plans

To remediate some of the above issues, notably those regarding decreased revenue, we intend to continue to roll out new products which we believe may have a broader appeal and more attractive price points. We are currently exploring a few new products based upon "Oats". We believe such products might appeal to a wider audience and result in an ability to offer such products at a lower price point.

It should be emphasized that we currently offer, and intend to offer, products that are plant based. Not all products we offer, or intend to continue to offer, are strictly replacements or substitutes to traditional meat products.

Additionally, we intend to focus on increasing our business operations in the European and US markets through various methods which, as of this time, have not been fully determined.

Additional information regarding the Company, its products, and its mission can be found on its website: www.nextmeats.co.jp





Other Corporate Updates

In December of 2022, we dissolved NextMeats France, a French Entity. We do not believe there to be a great enough demand for our products in France and surrounding areas, although we do still intend to offer our products in areas of Europe in the future.

We have also paused efforts to pursue selling products in Hong Kong under our wholly owned subsidiary, Next Meats HK Co. Limited ("Next Meats HK"), a Hong Kong Company. We do not believe the current market would be conducive to our business objectives in this area at this point in time. However, we will reassess this decision in the future, although we cannot specifically identity when that may be. Next Meats HK Co. Limited remains a wholly owned subsidiary of the Company.

Beginning March of 2023, Costco Wholesale Japan, Ltd. will stock and sell our newest Non-GMO soybean protein based alternative meat product, "Next Short Rib 2.1 (Marinated Japanese BBQ)", also called Next Kalbi 2.1, at Costco Wholesale locations in Japan. We believe that potential profits from this arrangement will will have a positive impact on our financial condition moving forward. However, at this time we cannot forecast with any level of specificity the financial impact this may have on our business going forward. We are only compensated by Costco Wholesale Japan, Ltd. on a case by case basis as they issue us purchase orders and we supply them with the products they have ordered. Costco Wholesale Japan, Ltd. can decide at any time to no longer purchase our products.





Going Concern

The Company demonstrates adverse conditions that raise substantial doubt about the Company's ability to continue as a going concern for one year following the issuance of these financial statements for the period ending January 31, 2023. These adverse conditions are negative financial trends, specifically operating loss, working capital deficiency, and other adverse key financial ratios.

The Company has not recorded enough revenue to cover its operating costs. Currently, management plans to fund some operating expenses with related party contributions to capital, or through the sale of equity, until there is sufficient revenue to cover all operating expenses. There is no assurance that management's plans will be successful. The financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that might be necessary in the event that the Company cannot continue as a going concern.

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