LEADER CAPITAL HOLDINGS CORP. The following discussion and analysis of our financial condition and results of
operations should be read together with our unaudited financial statements and
related notes appearing elsewhere in this Form 10-Q and our audited financial
statements and related notes for the year ended
Company Overview
Through LFGL, we act as the service provider for a mobile application investment platform that is owned by JFB. The platform connects investors with financial service providers in an effort to sharpen operational efficiency and seeks to address customer demands for more innovative services. It is a ready-made application created to meet the needs of financial service providers, especially trust companies and insurance companies. The platform is customizable and each financial institution can adjust the platform to better suit their client's needs.
Use of the JFB platform is currently free; however, we have an agreement with a
third party whereby we have authorized the third party to use our investment
platform and related applications until
The Company has been developing a new, more comprehensive FinMaster mobile
application ("FinMaster App"), to offer to our clients for a fee, which has been
made available for download as of
As a result of the acquisition, the Company now owns, indirectly through JFB,
100% of NPI. NPI, through its wholly-owned subsidiaries,
32
We have incurred significant operating losses. As of
Going Concern
The accompanying condensed 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.
We have suffered recurring losses from operations, and recorded an accumulated
deficit of
We expect to finance our operations primarily through cash flows from operations, loans from existing directors and shareholders and placements of capital stock for additional funding. In the event that we require additional funding to finance the growth of our current and expected future operations as well as to achieve our strategic objectives, a shareholder has indicated the intent and ability to provide additional financing. No assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to us. Even if we are able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stock holders, in the case of equity financing.
The COVID-19 pandemic has created and may continue to create significant uncertainty in macroeconomic conditions, which may cause further business slowdowns or shutdowns, depress demand for our business, and adversely impact our results of operations. We expect uncertainties around our key accounting estimates to continue to evolve depending on the duration and degree of impact associated with the COVID-19 pandemic. Our estimates may change as new events occur and additional information emerges, and such changes are recognized or disclosed in its consolidated financial statements.
These condensed consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should we be unable to continue as going concern.
Liquidity and Capital Resources
The following table sets forth a summary of our cash flows for the periods
indicated:
For the six months ended
February 28, 2021 February 29, 2020
Net cash used in operating activities $ (1,711,187 ) $ (378,264 )
Net cash used in investing activities (59,632 ) (813,323 )
Net cash provided by financing activities 1,449,707 975,818
Cash and cash equivalents, beginning of period 432,087 447,562
Effects of exchange rate changes on cash and
cash equivalents 53,037 -
Cash and cash equivalents, end of period $ 164,012 $ 231,793
33
Cash Used in Operating Activities
Net cash used in operating activities for the six months ended
Cash Used in Investing Activities
Net cash used in investing activities for the six months ended
Cash Provided by Financing Activities
Net cash provided by financing activities for the six months ended
Results of Operations
Comparison for the six months ended
For the six months ended
February 28, 2021 February 29, 2020
Revenue $ 55,252 $ 3,333
Research and development expenses (304,565 ) -
Sales and marketing expenses (170,730 ) -
General and administrative expenses (5,477,927 ) (2,484,998 )
Loss from operations (5,897,970 ) (2,481,665 )
Interest expenses (32,403 ) (30,107 )
Loss on change in fair value of convertible notes (330,288 ) -
Other income 23,025 50,282
Loss before income tax (6,237,636 ) (2,461,490 )
Income tax benefit (expense) 10,229 (30,250 )
Net loss $ (6,227,407 ) $ (2,491,740 )
Revenue
We signed an agreement with a third party whereby we authorized the third party
to use our investment platform and related applications, from
We generated revenue of
Research and Development Expenses
Research and development expenses for the six months ended
34 Sales and Marketing Expenses
Sales and marketing expenses were
General and Administrative Expenses
General and administrative expenses were
Other Income
Other income for the six months ended
Net Loss
Our net loss was
Comparison for the three months ended
For the three months ended
February 28, 2021 February 29, 2020
Revenue $ 32,389 $ 1,666
Research and development expenses (157,594 ) -
Sales and marketing expenses (61,028 ) -
General and administrative expenses (2,524,760 ) (1,246,851 )
Loss from operations (2,710,993 ) (1,245,185 )
Interest expenses (16,957 ) (15,148 )
Gain on change in fair value of convertible notes 150,755 -
Other income 1,733 28,473
Loss before income tax (2,575,462 ) (1,231,860 )
Income tax benefit (expense) 5,115 (10,250 )
Net loss $ (2,570,347 ) $ (1,242,110 )
Revenue
We signed an agreement with a third party whereby we authorized the third party
to use our investment platform and related applications, from
We generated revenue of
35
Research and Development Expenses
Research and development expenses for the three months ended
Sales and Marketing Expenses
Sales and marketing expenses were
General and Administrative Expenses
General and administrative expenses were
Other Income
Other income for the three months ended
Net Loss
Our net loss was
Off-Balance Sheet Arrangements
As of
Contractual Obligations
As a "smaller reporting company" as defined by Item 10 of Regulation S-K, the Company is not required to provide this information.
© Edgar Online, source
