Forward Looking Statement Notice
Certain statements made in this Quarterly Report on Form 10-Q
are "forward-looking statements" (within the meaning of the Private Securities
Litigation Reform Act of 1995) regarding the plans and objectives of management
for future operations. Such statements involve known and unknown risks,
uncertainties and other factors that may cause actual results, performance or
achievements of Crown Marketing, ("we", "us", "our" or the "Company") to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. The forward-looking
statements included herein are based on current expectations that involve
numerous risks and uncertainties. The Company's plans and objectives are based,
in part, on assumptions involving the continued expansion of business.
Assumptions relating to the foregoing involve judgments with respect to, among
other things, future economic, competitive and market conditions and future
business decisions, all of which are difficult or impossible to predict
accurately and many of which are beyond the control of the Company. Although
the Company believes its assumptions underlying the forward-looking statements
are reasonable, any of the assumptions could prove inaccurate and, therefore,
there can be no assurance the forward-looking statements included in this
Quarterly Report will prove to be accurate. In light of the significant
uncertainties inherent in the forward-looking statements included herein, the
inclusion of such information should not be regarded as a representation by the
Company or any other person that the objectives and plans of the Company will be
achieved.
History and Organization
America Great Health, formerly Crown Marketing, is a Wyoming corporation (the
"Company"). A change of control of the Company was completed on January 19, 2017
from Jay Hooper, the former officer and director of the Company and its former
majority shareholder. Control was obtained by the sale of 16,155,746,000 shares
of Company common stock from Mr. Hooper to an investor group led by Mike Q.
Wang. In connection with the change of control, the Company sold to its former
majority shareholder a subsidiary for $100 and another subsidiary in exchange
for the cancellation of all payables and accrued expenses. After December 31,
2016, the Company's operations are determined and structured by the new investor
group. As such, the Company accounted for all of its assets, liabilities and
results of operations up to January 1, 2017 as discontinued operations.
On March 1, 2017, the Company filed with the Secretary of State of the State of
Wyoming an Articles of Amendment to change the corporate name from Crown
Marketing to America Great Health.
On March 9, 2017, the Company formed a wholly owned subsidiary, America Great
Health, under the laws of the State of California.
On June 24, 2019, the Company registered a wholly owned subsidiary in China,
Meizhong Health Industry Development Co., Ltd. The subsidiary is mainly engaged
in mergers and acquisitions, investments and financings, and marketing of
medical equipment and health products in China.
On June 30, 2020, the Company and Purecell Group ("Purecell"), a leading
anti-aging medical institution in Australia, entered into a Cooperation
Agreement, in which the Company agreed to acquire 51% of the equity of Purecell.
As consideration for the acquisition, the Company shall issue 510,000,000 shares
of common stock to Purecell's nominated trustee. Upon completion of the
acquisition transaction, Purecell shall remain autonomous in its day to day
operation, including recruiting and retaining management team members. On
February 10, 2021, the Company completed its financial and legal due diligence.
This transaction was completed in May 2021.
On December 7, 2020, the Company's Californian subsidiary entered into a
Cooperation Agreement with Brilliant Healthcare Limited ("Brilliant") pursuant
to which the parties will establish a joint venture in China (the "JV Company")
for the purpose of promoting and developing stem cell related product's R&D,
production, sales, row material procumbent, mergers and acquisitions, and
consulting services. After the formation of the JV Company is completed, the
Company shall invest US$4.2 million in the JV Company within the next 24 months
for 60% equity ownership of the JV Company. Brilliant shall transfer its
patented technology to the JV Company as its capital contribution, to account
for 40% equity ownership in the JV Company. In June 2021, the JV Company was
established in Hainan, China as "Sijinsai (Hainan) Biological Tech Ltd." On July
9, 2021, the Company paid the first investment of $50,000.
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Overview of Business
Our mission is to invest in innovative technologies intergrated with business
development in the healthcare ecosystem.
We are focused on protein and peptide small molecular drugs research and
development, diagnostic and medical devices with AI cloud computing, cell
therapy and regenerational medicine and supplements manufacturing and sales.
Results of Operations
Results of Operations for the three and nine months ended March 31, 2021
compared to the three and nine months ended March 31, 2020.
Sales amounted to $195,535 and $0 for the three months ended March 31, 2021 and
2020, respectively. Sales amounted to $195,671 and $0 for the nine months ended
March 31, 2021 and 2020, respectively. The increase is of sales for the
comparative relevant periods is from the sale of products purchased from the
open market to a customer who accounted for 99% of our total sales in the three
months ended March 31, 2021.
Cost of goods sold amounted to $143,905 and $0 for the three months ended March
31, 2021 and 2020, respectively. Cost of goods sold amounted to $144,049 and $0
for the nine months ended March 31, 2021 and 2020, respectively. The increase of
cost of goods sold is due to increased sales.
Gross profit amounted to $51,630 and $0 for the three months ended March 31,
2021 and 2020, respectively. Gross profit amounted to $51,622 and $0 for the
nine months ended March 31, 2021 and 2020, respectively. The increase of gross
profit is due to increased sales.
Operating expenses incurred for the three months ended March 31, 2021 and 2020
were $98,688 and $1,482, respectively. Operating expenses incurred for the nine
months ended March 31, 2021 and 2020 were $134,502 and $13,621, respectively.
The increase over the relevant periods was mainly due to increased professional
fees.
Our net loss for the three months ended March 31, 2021 and 2020 was $49,215 and
$2,741, respectively. Our net loss for the nine months ended March 31, 2021 and
2020 was $88,155 and $18,052, respectively. The increase in net loss was mainly
due to increased professional fees.
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 an
ongoing basis. Significant factors in the management of liquidity are funds
generated by operations, levels of accounts receivable and accounts payable and
capital expenditures.
The accompanying consolidated financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and the settlement
of liabilities and commitments in the normal course of business. As reflected in
the accompanying consolidated financial statements, the Company has incurred
recurring net losses. For the nine months ended March 31, 2020, the Company
recorded a net loss of $18,052, used cash to fund operating activities of
$17,108, and cash provided by financing activities of $17,090. For the nine
months ended March 31, 2021, the Company recorded a net loss of $88,155, used
cash to fund operating activities of $97,025, and cash provided by financing
activities of $122,112. These factors create substantial doubt about the
Company's ability to continue as a going concern. The financial statements do
not include any adjustments that might be necessary if the Company is unable to
continue as a going concern.
The management's plans to continue as a going concern revolve around its ability
to achieve profitable operations, as well as raise necessary capital to pay
ongoing general and administrative expenses of the Company. The ability of the
Company to continue as a going concern is dependent on securing additional
sources of capital and the success of the Company's plan. There is no assurance
that the Company will be successful in raising the additional capital or in
achieving profitable operations.
Our cash needs for the nine months ended March 31, 2021 were primarily met by
loans and advances from current majority shareholder. As of March 31, 2021, we
had a cash balance of $25,253. Our new majority shareholders will need to
provide all of our working capitals going forward.
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Primarily as a result of our recurring losses and our lack of liquidity, we
received a report from our independent registered public accounting firm for our
financial statements for the year ended June 30, 2020 that includes an
explanatory paragraph describing the uncertainty as to our ability to continue
as a going concern.
Financial Position
As of March 31, 2021, we had $25,253 in cash, negative working capital of
$346,654 and an accumulated deficit of $3,374,797.
Critical Accounting Policies and Estimates
Estimates
The preparation of these consolidated financial statements in accordance with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosures of contingent assets and
liabilities at the dates of the consolidated financial statements and the
reported amounts of net sales and expenses during the reported periods. Actual
results may differ from those estimates and such differences may be material to
the financial statements. The more significant estimates and assumptions by
management include among others, the fair value of shares of common stock issued
for services. The current economic environment has increased the degree of
uncertainty inherent in these estimates and assumptions.
Recent Accounting Pronouncements
See Footnote 2 of the financial statements for a discussion of recently issued
accounting standards.
Contractual Obligations and Off-Balance Sheet Arrangements
We do not have any contractual obligations or off balance sheet arrangements.
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