The following discussion of the results of operations and financial condition
should be read in conjunction with our condensed consolidated financial
statements and notes thereto included in Item 1 of this part. This report,
including the information incorporated by reference, contains forward-looking
statements as defined in the Private Securities Litigation Reform Act of 1995.
The use of any of the words "believe," "expect," "anticipate," "plan,"
"estimate," and similar expressions are intended to identify such statements.
Forward-looking statements include statements concerning our possible or assumed
future results. The actual results that we achieve may differ materially from
those discussed in such forward-looking statements due to the risks and
uncertainties described in the Risk Factors section of this report, in
Management's Discussion and Analysis of Financial Condition and Results of
Operations, and in other sections of this report, as well as in our annual
report on Form 10-K. We undertake no obligation to update any forward-looking
statements.



Overview


Corporate History and Structure

We were incorporated on June 28, 2010 in the State of Nevada under the name "Island Radio, Inc." and changed our name to "China Herb Group Holdings Corporation" effective July 17, 2012. On December 9, 2019, the Company changed its corporate name to "Tengjun Biotechnology Corp."





On June 27, 2012, Eric R. Boyer and Nina Edstrom (collectively, the "Sellers"),
who were then the major shareholders of the Company, entered into a Share
Purchase Agreement with Chin Yung Kong, Qiuping Lu and Fumin Feng (collectively,
the "Purchasers"), pursuant to which the Sellers sold to the Purchasers an
aggregate 4,000,000 shares of the common stock of the Company, which represented
approximately 93% of the then total issued and outstanding stock of the Company,
for a total purchase price of $159,970 (the "Change in Control"). As result of
this share purchase transaction, Chin Yung Kong, Qiuping Lu and Fumin Feng
became the controlling shareholders of the Company.



Acquisitions/Business Combinations





On December 23, 2021, the Company entered into a Share Purchase/Exchange
Agreement (the "Share Exchange Agreement") with Tengjunxiang Biotechnology Ltd.
(the "Target"), a Cayman Islands corporation, and the Target's eleven
shareholders (the "Selling Shareholders"): Min Xing Biotechnolgy Ltd, Pastoral
Technology Co., Ltd., Shu Zhilin Trading Co., Ltd., Teng Rui Xiang Bio-Tech
Ltd., Aihua Trading Co., Ltd, Rock Climbing Technology, Langtaosha Trading Co.,
Ltd., Min Cheng Biotechnology Ltd, Kangfan Technology Co., Ltd., Chaorong
Technology Co., Ltd., and Shengrui Biotechnology Co., Ltd. In accordance with
the Share Exchange Agreement, on December 23, 2021, the Selling Shareholders
collectively sold and transferred 500,000,000 ordinary shares of the Target,
constituting one hundred percent (100%) of the issued and outstanding share
capital of the Target, to the Company in exchange for 19,285,714 shares of
Company's common stock, par value $0.001 per share (the "Tengjun Shares"), at an
agreed price of $0.19 per share of the Company's common stock (the "Common
Stock") for a total valuation of $3,675,000 of the Target.



In connection with the acquisition of the Target pursuant to the Share Exchange
Agreement, the Company is entering into the Chinese tea and water purifier
business through its newly acquired subsidiary the Target Company, which owns
four corporate entities: (i) Tengjunxiang Biotechnology HK Limited ("Tengjun
HK"), a company formed in Hong Kong and wholly owned by the Target, (ii)
Shandong Minfu Biotechnology Co., Ltd. ("WFOE"), a wholly foreign owned entity
formed under the laws of China and wholly owned by Tengjun HK, (iii) Shandong
Tengjunxiang Biotechnology Co., Ltd. ("Shangdong Tengjunxiang"), a company
formed under the laws of China and 94.95% owned by WFOE, and (iv) Jinxiang
County Kanglong Water Purification Equipment Co. Ltd. ("Kanglong"), a company
formed under the laws of China and wholly-owned subsidiary of Shandong
Tengjunxiang. The parties to this Agreement closed the transaction contemplated
therein on December 23, 2021.



The Target was incorporated on July 19, 2021 under the laws of the Cayman
Islands. The authorized capital stock of the Target is 500,000,000 ordinary
shares, all of which were issued and outstanding prior to the closing of the
Acquisition. Shangdong Tengjunxiang, our operating company, was formed on June
27, 2014, under the laws of China. Promptly after the Closing, the Target shall
update the shareholder registration of the Target to effect the Share Exchange
Agreement. The Share Exchange Agreement was signed and agreed by and among all
of the shareholders and/or beneficial owners of the Target, the Target and

the
Company.


As a result of the consummation of the Acquisition on December 23, 2021 as discussed above, the Target became a wholly-owned subsidiary of the Company and the business of the Target became the business of the Company.





                                       17




The diagram below illustrates our corporate structure following the Acquisition:





                               [[Image Removed]]



We had limited operations and generated limited revenues from our business
operations before the quarter ended June 30, 2022. Our independent registered
public accounting firm has issued a going concern opinion for the year ended
December 31, 2021. This means that our auditors believe there is substantial
doubt that we can continue as an on-going business for the next 12 months.
Accordingly, we may have to raise additional cash from various sources,
including operations, controlling shareholders' investments and debt and equity
financing from third party investors.



Results of Operations


Results of Operations - Three Months Ended June 30, 2022 Compared to Three Months Ended June 30, 2021.

The following table sets forth information from our statements of comprehensive income for the three months ended June 30, 2022 and 2021:





                                                Three Months Ended
                                                     June 30,                            Change
                                               2022             2021          (Amount)         (Percent)
Sales revenue                              $  51,290,462     $        -     $  51,290,462                  * %
Cost of Goods Sold                            (3,438,949 )            -        (3,438,949 )                * %
Gross Profit                                  47,851,513              -        47,851,513                  * %
Operating Expenses                           (51,341,188 )     (219,420 )     (51,121,768 )           23,299 %
Operating Income (Loss)                       (3,489,675 )     (219,420 )      (3,270,255 )            1,490 %
Interest Income (Expense)                          7,397             (4 )           7,401           (185,025 )%
Other Income (Expense)                               (74 )       (2,657 )           2,583                (97 )%
Income Tax Provision (Benefit)                   (53,366 )            -           (53,366 )                * %
Net Income (Loss)                             (3,428,986 )     (222,081 )      (3,206,905 )            1,444 %
Comprehensive Income (loss)                $  (3,228,216 )   $ (241,974 )
$  (2,986,242 )            1,234 %




                                       18





Revenues



We generated $51,290,462 and $0 in revenues for the three months ended June 30,
2022 and 2021, respectively. The Company did not generate any revenue during the
three months ended June 30, 2021 due to the impact of COVID-19.



During the three months ended June 30, 2022, sales of dandelion teas, certain
nutritional products, and water treatment accessories generated $51,444,665 in
revenue, constituting approximately 100% of the total revenue for that quarter,
and sales of water purifiers generated negative revenue of $154,203 due to sales
returns, representing approximately 0% of the total revenue for such quarter.



The following is the sales breakdown by segment during the three months ended June 30, 2022 and 2021:





                      For the three months ended
                               June 30,
                          2022                 2021
Dandelion teas   $ 51,444,665       100 %    $ -    -%
Water purifier       (154,203 )      (0 )%     -    -%
Total            $ 51,290,462       100 %    $ -    -%




Cost of Goods Sold



Our cost of goods sold was $3,438,949 and $0 for the three months ended June 30,
2022 and 2021, respectively. During the three months ended June 30, 2022, cost
of sales of dandelion teas, certain nutritional products, and water treatment
accessories was $3,456,644, constituting approximately 101% of the total cost of
goods sold, and cost of sales of water purifiers was $(17,695), representing
approximately negative 1% of the total cost of goods sold due to the cost
adjustment in connection with the sales returns. The Company did not incur any
cost in the three months ended June 30, 2021 because there were no sales during
the second quarter of 2021.



The following is the cost of goods sold breakdown by segment during the three months ended June 30, 2022 and 2021:





                      For the three months ended
                               June 30,
                          2022                 2021
Dandelion teas   $    3,456,644     101 %    $ -     - %
Water purifier          (17,695 )    (1 )%     -     - %
Total            $    3,438,949     100 %    $ -     - %




Gross Margin



Our gross margin was $47,851,513 and $0 for the three months ended June 30, 2022
and 2021, respectively. The gross profit as a percentage of net revenue for the
Dandelion teas was 100% for the three months ended June 30, 2022. The gross
profit as a percentage of net revenue for water purifiers was approximately 0%
for the three months ended June 30, 2022.



The following table presents gross margin by segment for three months ended June 30, 2022 and 2021:





                      For the three months ended
                               June 30,
                          2022                 2021
Dandelion teas   $   47,988,021     100 %    $ -     - %
Water purifier         (136,508 )    (0 )%     -     - %
Total            $   47,851,513     100 %    $ -     - %



Selling and Marketing Expenses

Our selling and marketing expenses primarily consist of sales commission, advertising and product promotion expenses.





Our selling and marketing expenses were $51,072,254 for the three months ended
June 30, 2022 as compared to $13,419 for the three months ended June 30, 2021.
Our total selling and marketing expenses increased by $51,058,835 or 380,497%
during the three months ended June 30, 2022, compared to the same period in
2021. Such increase in selling and marketing expenses was mainly due to the
significant increase in sales commission.



                                       19




General and administrative expenses





Our general and administrative expenses primarily consist of payroll and benefit
costs for corporate employees, legal, consulting, professional expenses, rental
expenses and other corporate overhead costs.



The general and administrative expenses was $268,934 for the three months ended
June 30, 2022 as compared to $206,001 for the three months ended June 30, 2021.
Our general and administrative expenses increased by $62,933 or 31% during the
three months ended June 30, 2022, compared to the same period in 2021. Such
increase in general and administrative expenses was mainly due to the increase
in legal, accounting, printing, and stock transfer agent fees that were
associated with the Company's merger and acquisition activities and SEC filings.



Interest income (expense)



Interest income (expense) was $7,397 for the three months ended June 30, 2022 as
compared to $(4) for the three months ended June 30, 2021. Our total interest
income increased by $7,401 or 185,025% during the three months ended June 30,
2022, compared to the same period in 2021. The increase in interest income was
primarily due to the interest earned from the Company's bank savings accounts.



 Net Income (Loss)

Our net loss was $3,428,986 for the three months ended June 30, 2022 as compared
to net loss of $222,081 for the three months ended June 30, 2021, increased by
$3,206,905 or 1,444 % as a result of the above factors.



Foreign Currency Translation Loss





We had $200,770 in foreign currency translation gain during the three months
ended June 30, 2022 as compared to $(19,893) in foreign currency translation
loss during the three months ended June 30, 2021, reflecting a change of
$220,663 or 1,109%. Such increase in foreign currency translation gain was
primarily caused by the currency exchange rate fluctuation.



Results of Operations - Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021.

The following table sets forth information from our statements of comprehensive income for the six months ended June 30, 2022 and 2021:





                                    Six Months Ended
                                        June 30,                          Change
                                  2022             2021          (Amount)         (Percent)
Sales revenue                 $  55,574,576     $        -     $  55,574,576               * %
Cost of Goods Sold               (3,809,013 )            -        (3,809,013 )             * %
Gross Profit                     51,765,563              -        51,765,563               * %
Operating Expenses              (54,929,500 )     (380,546 )    

(54,548,954 ) 14,334 % Operating Income (Loss) (3,163,937 ) (380,546 ) (2,783,391 )

           731 %
Interest Income (Expense)             7,421         (4,977 )          12,398            (249 )%
Other Income (Expense)                  (74 )       (2,657 )           2,583             (97 )%
Income Tax Provision                 39,589              -            39,589               * %
Net Income (Loss)                (3,196,179 )     (388,180 )      (2,807,999 )           723 %

Comprehensive Income (loss) $ (3,004,847 ) $ (401,476 ) $ (2,603,371 )

           648 %




Revenue



We generated $55,574,576 and $0 in revenues for the six months ended June 30,
2022 and 2021, respectively. The Company did not generate any revenue during the
six months ended June 30, 2021 due to the impact of COVID-19.



During the six months ended June 30, 2022, sales of dandelion teas, certain
nutritional products, and water treatment accessories generated $54,908,343 in
revenue, constituting approximately 99% of the total revenue for that period,
and sales of water purifiers generated $666,233 in revenue, representing
approximately 1% of the total revenue for such period.



The following is the sales breakdown by segment during the six months ended June
30, 2022 and 2021:



                           For the six months ended
                                   June 30,
                        2022                     2021
Dandelion teas   $ 54,908,343    99 %   $          -        -%
Water purifier        666,233     1 %              -        -%
Total            $ 55,574,576   100 %   $          -        -%




                                       20





Cost of Goods Sold



Our cost of goods sold was $3,809,013 and $0 for the six months ended June 30,
2022 and 2021, respectively. During the six months ended June 30, 2022, cost of
sales of dandelion teas, certain nutritional products, and water treatment
accessories was $3,730,491, constituting approximately 98% of the total cost of
goods sold, and cost of sales of water purifiers was $78,522, representing
approximately 2% of the total cost of goods sold. The Company did not incur any
cost in the six months ended June 30, 2021 because there were no sales during
the same period of 2021.


The following is the cost of goods sold breakdown by segment during the six months ended June 30, 2022 and 2021:





                      For the six months ended
                              June 30,
                         2022                2021
Dandelion teas   $   3,730,491      98 %   $ -     - %
Water purifier          78,522       2 %     -     - %
Total            $   3,809,013     100 %   $ -     - %




Gross Margin



Our gross margin was $51,765,563 and $0 for the six months ended June 30, 2022
and 2021, respectively. The gross profit as a percentage of net revenue for the
Dandelion teas was 99% for the six months ended June 30, 2022. The gross profit
as a percentage of net revenue for water purifiers was approximately 1% for the
six months ended June 30, 2022.



The following table presents gross margin by segment for six months ended June
30, 2022 and 2021:



                      For the six months ended
                              June 30,
                         2022                2021
Dandelion teas   $  51,177,852      99 %   $ -     - %
Water purifier         587,711       1 %     -     - %
Total            $  51,765,563     100 %   $ -     - %



Selling and Marketing Expenses

Our selling and marketing expenses primarily consist of sales commission, advertising and product promotion expenses.





Our selling and marketing expenses were $54,430,227 for the six months ended
June 30, 2022 as compared to $16,878 for the six months ended June 30, 2021. Our
total selling and marketing expenses increased by $54,413,349 or 322,392% during
the six months ended June 30, 2022, compared to the same period in 2021. Such
increase in selling and marketing expenses was mainly due to the significant
increase in sales commission.


General and administrative expenses





Our general and administrative expenses primarily consist of payroll and benefit
costs for corporate employees, legal, consulting, professional expenses, rental
expenses and other corporate overhead costs.



The general and administrative expenses was $499,273 for the six months ended
June 30, 2022 as compared to $363,668 for the six months ended June 30, 2021.
Our general and administrative expenses increased by $135,605 or 37% during the
six months ended June 30, 2022, compared to the same period in 2021. Such
increase in general and administrative expenses was mainly due to the increase
in legal, accounting, printing, and stock transfer agent fees that were
associated with the Company's merger and acquisition activities and SEC filings.



Interest income (expense)



Interest income (expense) was $7,421 for the six months ended June 30, 2022 as
compared to $(4,977) for the six months ended June 30, 2021, representing an
increase from interest expense to interest income by $12,398, or 249% during the
six months ended June 30, 2022, compared to the same period in 2021, primarily
due to the repayment of a short-term bank loan on March 17, 2021 and the
interest earned from Company's bank savings accounts.



                                       21





Net Income (Loss)



Our net loss was $3,196,179 for the six months ended June 30, 2022 as compared
to net loss of $388,180 for the six months ended June 30, 2021, increased by
$2,807,999 or 723 % as a result of the above factors.



Foreign Currency Translation Loss


We had $191,332 in foreign currency translation gain during the six months ended
June 30, 2022 as compared to $(13,296) in foreign currency translation loss
during the six months ended June 30, 2021, reflecting a change of $204,628 or
1,539%. Such increase in foreign currency translation gain was primarily caused
by the currency exchange rate fluctuation.



Liquidity and Capital Resources





Working Capital



                              June 30,        December 31,                Change
                                2022              2021            (Amount)       (Percent)
Current Assets              $   8,530,209     $   4,628,531        3,901,678             84 %
Current Liabilities         $  22,813,084     $  16,316,116        6,496,968             40 %

Working Capital (deficit) $ (14,282,875 ) $ (11,687,585 ) (2,595,290 )

           22 %




Our working capital deficit was $14,282,875 as of June 30, 2022 as compared to
$11,687,585 as of December 31, 2021, an increase of $2,595,290 or 22%. The
increase in working capital deficiency is primarily due to the increase in the
liabilities related to our operating activities during the six months ended
June
30, 2022.


Cash Flow from Operating Activities





Our net cash provided by operating activities were $7,691,850 for the six months
ended June 30, 2022 as compared to $141,967 of net cash used in operating
activities for the six months ended June 30, 2021, reflecting an increase of
$7,833,817 or 5518%. The increase was primarily due to the decrease in
inventories, prepaid taxes, and increase in accounts payable and taxes payable
during the six months ended June 30, 2022 compared to the six months ended
June
30, 2021.


Cash Flow from Investing Activities





Our net cash used in investing activities was $212,875 for the six months ended
June 30, 2022 as compared to that of $271,331 for the six months ended June 30,
2021, reflecting a decrease of $58,456 or 22%. The decrease in net cash used in
investing activities was primarily due to the decrease in payment for
construction in progress and acquisition of equipment during the six months
ended June 30, 2022 as compared to those items in the six months ended June

30,
2021.


Cash Flow from Financing Activities


Our net cash used in financing activities were $776,804 for the six months ended
June 30, 2022 as compared to $593,382 of net cash provided by financing
activities for the six months ended June 30, 2021, representing a decrease of
$1,370,186 or 231%. The decrease was primarily due to the decreased cash inflow
from loans from related parties during the six months ended June 30, 2022.

Off-Balance Sheet Arrangements





As of June 30, 2022, we did not have any off-balance sheet arrangements that
have or are reasonably likely to have a current or future effect on our
financial condition, changes in financial condition, revenues or expenses,
results of operations, liquidity, capital expenditures, or capital resources
that is material to investors.



                                       22




Critical Accounting Policies and Estimates





We prepare our financial statements in conformity with Generally Accepted
Accounting Principles ("GAAP") of the United States, which requires management
to make certain estimates and apply judgments. We base our estimates and
judgments on historical experience, current trends and other factors that
management believes to be important at the time the financial statements are
prepared. On a regular basis, we review our accounting policies and how they are
applied and disclosed in our financial statements.



While we believe that the historical experience, current trends and other factors considered support the preparation of our financial statements in conformity with GAAP, actual results could differ from our estimates and such differences could be material.





Inventories



Our inventories primarily consist of dandelion teas and water purifiers.
Inventories are valued at the lower of cost (determined on a weighted average
basis) and net realizable value. Inventories consist of raw materials, goods in
process, and finished goods. We review our inventories regularly for possible
obsolete goods and establishes reserves when determined necessary. As of June
30, 2022 and December 31, 2021, the allowance for obsolete inventories was
$0
and $0, respectively.



Construction in Progress



Construction in progress represents direct costs of construction, interest and
design fees incurred. No interest was capitalized for the three months ended
June 30, 2022 and 2021. Capitalization of these costs ceases and the
construction in progress is transferred to property, plant, and equipment when
substantially all the activities necessary to prepare the assets for their
intended use are completed. No depreciation is recognized until it is completed
and ready for intended use. Construction in progress as of June 30, 2022 and
December 31, 2021 was $8,506,821 and $8,726,299, respectively.



Revenue Recognition



The Company recognizes revenue in accordance with ASC Topic 606, Revenue from
Contracts with Customers. To determine the revenue to be recognized, the Company
applies the following five-step model:



       ?   identify arrangements with customers;

       ?   identify performance obligations;

       ?   determine transaction price;

? allocate transaction price to the separate performance obligations in


           the arrangement, if more than one exists; and

       ?   recognize revenue as performance obligations are satisfied.




The Company generates revenues mainly from sales of packaged dandelion teas and
water purifiers. During the three and six months ended June 30, 2022, the
Company also engaged in the sale of certain nutritional products and water
treatment accessories.Revenue from the sales of goods is recognized when the
control over the promised goods is transferred to customers.



Cash payments received or due from customers before revenue recognized are recorded as advances from customers. The advance from customers is recognized as revenue when the Company's performance obligation is completed.





Related parties



The Company follows ASC 850, "Related Party Disclosures," for the identification
of related parties and disclosure of related party transactions. Parties are
related if one party has the ability, directly or indirectly, to control the
other party or exercise significant influence over the other party in making
financial and operating decisions. Parties are also considered to be related if
they are subject to common control or significant influence, such as a family
member or relative, shareholder, or a related corporation.



Recent Accounting Pronouncements

See Note 3 to our unaudited consolidated financial statements for the three and six months ending June 30, 2022 and 2021.





                                       23

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