The following discussion should be read in conjunction with our financial
statements and notes to those financial statements, included elsewhere in this
prospectus. This discussion contains forward-looking statements that involve
risks and uncertainties. Our actual results and the timing of selected events
could differ materially from those anticipated in these forward-looking
statements as a result of various factors, including those set forth under "Risk
factors" and elsewhere in this prospectus.
FORWARD-LOOKING STATEMENTS:
Certain statements made in this Report may constitute "forward-looking
statements on our current expectations and projections about future events."
These forward-looking statements involve known or unknown risks, uncertainties
and other factors that may cause our actual results, performance, or
achievements to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. In some
cases you can identify forward-looking statements by some words such as "may,"
"should," "potential," "continue," "expects," "anticipates," "intends," "plans,"
"believes," "estimates," and similar expressions. These statements are based on
our current beliefs, expectations, and assumptions and are subject to a number
of risks and uncertainties. Although we believe that the expectations reflected
in the forward-looking statements are reasonable, we cannot guarantee future
results, levels of activity, performance or achievements. These forward-looking
statements are made as of the date of this Report, and we assume no obligation
to update these forward-looking statements whether as a result of new
information, future events, or otherwise, other than as required by law. In
light of these assumptions, risks, and uncertainties, the forward-looking events
discussed in this Report might not occur and actual results and events may vary
significantly from those discussed in the forward-looking statements.
Overview and Recent Developments
As a result of the Exchange, which was consummated January 23, 2023, we are no
longer a shell company. However, for the fiscal year ended as of December 31,
2022, we were a shell company and did not generate any revenues.
The Report of our independent registered public accountants on our financial
statements for the year ended December 31, 2022 states that these conditions,
among others, raise substantial doubt about our ability to continue as a going
concern.
On February 7, 2023, the Board and the holder of 121,343,700 shares of Common
Stock, representing approximately 59.98% of the Company's voting equity,
approved by written consent, in accordance with the applicable provisions of
Nevada law, the execution and filing of the Amendment with the Nevada Secretary
of State, to effect the change of the Company's name from "Joway Health
Industries Group Inc." to "Idaho Copper Corporation". On March 9, 2023, the
Company filed the Amendment with the Nevada Secretary of State, with immediate
effect.
Results of Operations
Year Ended December 31, 2022 Compared to Year Ended December 31, 2021
Revenues. During the years ended December 31, 2022 and 2021, we did not realize
any revenues from operations.
25
Operating expenses. For the year ended December 31, 2022, our total operating
expenses were $74,708, a decrease by $47,080, or 39%, from $121,788 for the year
ended December 31, 2021. This decrease was mainly due to reduction from the
professional fees related to legal services. For the year ended December 31,
2021, our total operating expenses were $121,788, decreased by $100,819, or 45%,
from $222,607 for the year ended December 31, 2020. This decrease was mainly due
to disposal of operations in 2020 and becoming a shell company as of January 1,
2021.
Loss from operations. As a result of the foregoing, our loss from operations was
$74,708 for the year ended December 31, 2022, compared to $121,788 for the year
ended December 31, 2021. This decrease was mainly due to reduction from the
professional fees related to legal services.
Income taxes. We did not incur income tax expenses for the years ended December
31, 2022 and 2021.
Net loss. For the year ended December 31, 2022, our net loss was $74,708
compared to $121,788 for the year ended December 31, 2021. The decreased loss
was primarily due to the decreased operating expenses.
Liquidity and Capital Resources
As of December 31, 2022, we had current assets of $0, we had liabilities of
$177,761, and our working capital deficit was $177,761. We anticipate that our
current liquidity is not sufficient to meet the obligations associated with
being a company that is fully reporting with the SEC.
During fiscal year ended December 31, 2022, we kept our monthly cash flow
requirement low for two reasons. First, our sole officer did not draw a salary.
Second, we were able to keep our operating expenses to a minimum by operating in
space provided at no expense by our sole officer and director.
We currently have no external sources of liquidity such as arrangements with
credit institutions or off-balance sheet arrangements that will have or are
reasonably likely to have a current or future effect on our financial condition
or immediate access to capital.
Our financial statements have been prepared in conformity with accounting
principles generally accepted in the United States of America ("GAAP"), which
contemplates our continuation as a going concern. We have not yet generated any
revenue and have incurred losses to date of approximately $7,430,676. In
addition, our current liabilities exceed our current assets by $177,761. These
factors raise substantial doubt about our ability to continue operating as a
going concern. Our ability to continue our operations as a going concern,
realize the carrying value of our assets, and discharge our liabilities in the
normal course of business is dependent upon our ability to raise capital
sufficient to fund our commitments and ongoing losses, and ultimately generate
profitable operations.
Cash Flows
Operating Activities
For the year ended December 31, 2022, net cash used in operating activities was
$0 and related to our net loss from continuing operations of $74,708, offset by
an increase in other payables of $74,708.
For the year ended December 31, 2021, net cash used in operating activities was
$70,079, related to our net loss of $121,788, reduced by an increase in other
payables of $51,709.
Investing Activities
For the year ended December 31, 2022, we reported no cash provided by our
investing activities. For the year ended December 31, 2021, we reported cash
inflow of $119,070 from investing activities due to disposal of our operating
subsidiaries.
Financing Activities
For the year ended December 31, 2022, we had no cash inflow from our financing
activities. For the year ended December 31, 2021, we reported a cash outflow of
$48,991 from our financing activities which was mainly due to distribution of
$119,070 as a special dividend to our minority shareholders and a financial
support of $70,079 received from our related party.
26
Critical Accounting Policies
Our financial statements and accompanying notes have been prepared in accordance
with United States generally accepted accounting principles ("GAAP") applied on
a consistent basis. The preparation of financial statements in conformity with
GAAP 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 periods.
We regularly evaluate the accounting policies and estimates that we use to
prepare our financial statements. A complete summary of these policies is
included in the notes to our financial statements. In general, management's
estimates are based on historical experience, on information from third party
professionals, and on various other assumptions that are believed to be
reasonable under the facts and circumstances. Actual results could differ from
those estimates made by management.
The financial statements have been prepared in conformity GAAP, which
contemplates our continuation as a going concern. The Company has no revenue
since January 1, 2020 and has incurred losses to date of approximately $7.4
million. In addition, the Company's current liabilities exceed its current
assets by $177,761. The Company intends on financing its future development
activities and its working capital needs largely from the sale of public equity
securities with some additional funding from other traditional financing
sources, including term notes until such time that funds provided by operations
are sufficient to fund working capital requirements. These factors raise
substantial doubt about the Company's ability to continue operating as a going
concern. The Company's ability to continue our operations as a going concern,
realize the carrying value of our assets, and discharge our liabilities in the
normal course of business is dependent upon our ability to raise capital
sufficient to fund its commitments and ongoing losses, and ultimately generate
profitable operations.
Contractual Obligations
We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act
and are not required to provide the information under this item.
27
Off Balance Sheet Items
Under SEC regulations, we are required to disclose off-balance sheet
arrangements that have or are reasonably likely to have a current or future
effect on our financial condition, such as changes in financial condition,
revenues or expenses, results of operations, liquidity, capital expenditures or
capital resources that are material to investors. An off-balance sheet
arrangement means a transaction, agreement or contractual arrangement to which
any entity that is not consolidated with us is a party, under which we have:
? any obligation under certain guarantee contracts,
? any retained or contingent interest in assets transferred to an unconsolidated
entity or similar arrangement that serves as credit, liquidity or market risk
support to that entity for such assets,
? any obligation under a contract that would be accounted for as a derivative
instrument, except that it is both indexed to our stock and classified in
shareholder equity in our statement of financial position, and
? any obligation arising out of a material variable interest held by us in an
unconsolidated entity that provides financing, liquidity, market risk or
credit risk support to us, or engages in leasing, hedging or research and
development services with us.
We do not have any off-balance sheet arrangements that we are required to
disclose pursuant to these regulations. In the ordinary course of business, we
enter into operating lease commitments, purchase commitments and other
contractual obligations. These transactions are recognized in our financial
statements in accordance with generally accepted accounting principles in the
United States.
Going Concern
We incurred net losses of approximately $74,708 for the year ended December 31,
2022. We had an accumulated deficit of approximately $7,430,676 and working
capital deficiency of $177,761 as of December 31, 2022. These conditions raise
substantial doubt about the Company's ability to continue as a going concern.
The continuation of us as a going concern through the next twelve months is
dependent upon the continued financial support from its stockholders or external
financing. There can be neither no assurances to that effect, nor no assurance
that we will be successful in securing sufficient funds to sustain the
operations.
These financial statements do not include any adjustments to reflect the
possible future effect on the recoverability and classification of assets or the
amounts and classifications of liabilities that may result from the outcome of
these uncertainties. We believe that the actions presently being taken to obtain
additional funding and implement its strategic plan provides the opportunity for
the Company to continue as a going concern.
28
Revenue Recognition
The Company recognizes revenue when control of promised goods or services is
transferred to the company's customers, in an amount that reflects the
consideration the Company expects to be entitled to in exchange for those goods
or services.
Prior to the Merger Agreement as of December 31, 2020, with respect to sales of
product to both franchisee and non-franchisee customers, the Company transfers
control, invoices the customer and recognizes revenue upon shipment to the
customer. Sales prices are based on fixed price lists that are different
depending on whether the price list is for franchisee customers or for
non-franchisee customers. Sales, value add and other taxes collected concurrent
with revenue-producing activities are excluded from revenue.
After the consummation of the Merger as of December 31, 2020, the Company did
not report any revenue for the year ended December 31, 2022 or December 31,
2021.
Recent Accounting Pronouncements
No accounting standards that have been issued or proposed by the FASB or other
standards-setting bodies that require adoption until a future date are expected
to have a material impact on the Company's financial statements upon adoption.
© Edgar Online, source Glimpses