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    WETG   US9618841038

WETRADE GROUP INC.

(WETG)
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WETRADE : MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-Q)

12/02/2020 | 03:55pm EDT

The following discussion and analysis of financial condition and results of operations should be read in conjunction with our financial statements and related notes included elsewhere in this report. This discussion contains forward-looking statements that involve risks, uncertainties and assumptions. See "Cautionary Note Regarding Forward-Looking Statements." Our actual results could differ materially from those anticipated in the forward-looking statements as a result of certain factors discussed elsewhere in this report.



Overview


WeTrade Group Inc. is in the business of providing technical services and solutions via its membership-based social e-commerce platform and the Group is target to provided technical and auto-billing management services for 100 million micro-business online stores in China.

In January 2020, WeTrade have appointed 3rd party software company to develop an auto-billing management system ("Wepay System") at the cost of RMB 400,000 in order to provide online payment services for its online store customers in PRC.

The main functions of Wepay System is an online payment services, CPS profit management services, multi-channels App and data analysis, which is developed to provide payment and auto-billing services for online store customers from retail, tourism industry, hospitality and beauty industry.

As at September 30, 2020, the auto-billing management system of WeTrade group has more than 12 million micro-business users, 60,000 blog users and more than 2000 hotels direct booking suppliers in China. It is expected will be more than 12% of 100 million micro-business users in China by end of 2020.



Results of Operations


The following tables provide a comparison of a summary of our results of operations for the nine months period ended September 30, 2020 and 2019.

Results of Operations for the Nine months period Ended September 30, 2020 and

                                      2019



                                                                       From the period
                                                                          March 28,
                                                                            2019
                                                   For the Period      (Inception) to
                                                   September 30,        September 30,
                                                        2020                2019
Revenue:
Service revenue, non-related party                $        518,269     $             -
Service revenue, related party                           2,370,192                   -
                                                         2,888,461                   -
Cost of Revenue                                           (515,195 )                 -
Gross Profit                                             2,373,266
Operating Expenses:
General and Administrative                                (617,216 )          (255,010 )
Operations Profit/ (Loss)                               (1,756,050 )          (255,010 )
Other revenue                                               39,060                   -
Net Income/ (Loss) before income tax                     1,795,110            (255,010 )
Income tax expense                                        (487,984 )                 -
Net Income/ (loss)                                $      1,307,126     $      (255,010 )





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Revenue from Operations

For the nine-month period ended September 30, 2020 and 2019, total revenue was $2,888,461 and $0, respectively. The increase was mainly from the service revenue generated from auto-billing management system from customers.

Cost of revenue

Cost of revenue is mainly consists of staff payroll, PRC central provident fund ("CPF") and other staff benefits, the increase is mainly due to more staffs were recruited during the period. The increase is in line with the increase in revenue during the period.

General and Administrative Expenses

For the nine months period ended September 30, 2020 and 2019, general and administrative expenses were $617,216 and 255,010, respectively. The increase is mainly due to increase in the payroll expenses as a result of 77 new staffs were recruited during the period.

Net Income (Loss)

As a result of the factors described above, there was a net profit of $1,307,126 and net loss of $255,010 for the nine months period ended September 30, 2020 and 2019, respectively, the increase mainly due to revenue generated from auto-billing management system from related party.

Results of Operations for the Three months period ended September 30, 2020 and

                                     2019.



                                           2020            2019
Revenue

Service revenue, non-related party $ 518,269 $ - Service revenue, related party

            1,493,829               -
                                          2,012,098               -
Cost of Revenue                            (427,647 )             -
Gross Profit                              1,584,451               -

General and Administrative Expense (407,067 ) (110,921 ) Profit/ (Loss) from Operations

            1,177,384        (110,921 )
Other revenue                                38,939               -
Net Income/ (Loss) before income tax      1,216,323        (110,921 )
Income tax expenses                        (475,431 )             -
Net Income/ (loss)                     $    740,893     $  (110,921 )




Revenue from Operations

For the three-month period ended September 30, 2020 and 2019, total revenue was $2,012,098 and $0, respectively. The increase was mainly due to increase in service revenue generated from auto-billing management system from micro-business users.




Cost of revenue

Cost of revenue is mainly consists of staff payroll, PRC central provident fund ("CPF") and other staff benefits, the increase is mainly due to more staffs were recruited during the period. The increase is in line with the increase in revenue during the period.

General and Administrative Expenses

For the three months period ended September 30, 2020 and 2019, general and administrative expenses were $407,067 and $110,921, respectively. The increase is mainly due to increase in the payroll expenses as a result of 77 new staffs were recruited during the period.

Net Income (Loss)

As a result of the factors described above, there was a net profit of $740,893 and net loss of $110,921 for the three months period ended September 30, 2020 and 2019, respectively. The increase mainly due to increase in revenue generated from auto-billing management system from customers.




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Liquidity and Capital Resources

As of September 30, 2020, we had cash on hand of $6,787,535. The increase is mainly due to the increase in revenue from auto-billing management services from customers. The increase is mitigated by the repayment of related party loan of $650,000 and $710,000 in January 21, 2020 and March 2, 2020 respectively as compare to the bank balance of $6,591,128 in December 31, 2019.

Operating activities

Our continuing operating activities used cash of $1,042,610 and $509 for the periods ended September 30, 2020 and 2019, respectively. The increase was mainly due to loan repayment of approximately $1.6 million to related parties.

Financing activities

Cash provided in our financing activities was increased to $835,500 and $220,020 for the periods ended September 30, 2020 and 2019, respectively. The increase was due to additional 1,896,166 shares issued to new 307 shareholders for cash in total amount of $757,500 during the period.



Inflation


Inflation does not materially affect our business or the results of our operations.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements.



Critical Accounting Policies


We prepare our financial statements in accordance with generally accepted accounting principles of the United States ("GAAP"). GAAP represents a comprehensive set of accounting and disclosure rules and requirements. The preparation of our financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Our actual results could differ from those estimates. We use historical data to assist in the forecast of our future results. Deviations from our projections are addressed when our financials are reviewed on a monthly basis. This allows us to be proactive in our approach to managing our business. It also allows us to rely on proven data rather than having to make assumptions regarding our estimates.

Recent Accounting Pronouncements

We have reviewed all the recently issued, but not yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Company financial statements.




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© Edgar Online, source Glimpses

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Financials (USD)
Sales 2020 6,27  - -
Net income 2020 2,68 M - -
Net cash 2020 1,46 M - -
P/E ratio 2020 688x
Yield 2020 -
Capitalization 1 008 M 1 008 M -
EV / Sales 2019 -
EV / Sales 2020 294 427 741x
Nbr of Employees 89
Free-Float 27,5%
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Managers and Directors
Pi Jun Liu Chief Executive Officer & Director
Kean Tat Che CFO, Secretary & Executive Director
Dai Zheng Chairman
Li Zhuo Chief Operating Officer & Executive Director
Yu Xing Ye Independent Director & Compliance Officer
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