10-Q: Yong Bai Chao New Retail Corporation Reports Minimal Activity and Ongoing Losses in Q3 2024

Yong Bai Chao New Retail Corporation reported no revenue and a net loss for the third quarter of 2024, as it continues to seek a new operating business.

Summary

• Yong Bai Chao New Retail Corporation, formerly known as Environmental Control Corp., reported its financial results for the quarter ended September 30, 2024.
• The company did not generate any revenue during the three and nine months ended September 30, 2024.
• Operating expenses for the three months ended September 30, 2024 were $7,653, compared to $9,970 for the same period in 2023.
• The company's net loss for the three months ended September 30, 2024 was $7,653, compared to a net loss of $9,970 for the same period in 2023.
• For the nine months ended September 30, 2024, operating expenses totaled $34,889, a decrease from $53,767 in the same period of 2023.
• The net loss for the nine months ended September 30, 2024 was $34,889, compared to a net loss of $53,767 for the same period in 2023.
• As of September 30, 2024, the company had no cash, total liabilities of $141,548, and a working capital deficit of $141,548.
• The company is currently a shell company with no substantial business operations and is focused on finding a new operating business.
• The company's management believes that its current cash and other sources of liquidity are adequate to support operations for at least the next 12 months.

Sentiment

Score: 2

Explanation: The document paints a negative picture due to the lack of revenue, ongoing losses, and the company's status as a shell company with no substantial business operations. The going concern warning and material weaknesses in internal controls further contribute to the low sentiment.

Positives

• Operating expenses decreased for both the three and nine month periods ended September 30, 2024.
• The net loss decreased for both the three and nine month periods ended September 30, 2024.
• The company's management believes that its current cash and other sources of liquidity are adequate to support operations for at least the next 12 months.

Negatives

• The company generated no revenue for both the three and nine months ended September 30, 2024.
• The company has a working capital deficit of $141,548 as of September 30, 2024.
• The company is currently a shell company with no substantial business operations.
• The company has an accumulated deficit of $3,710,597 as of September 30, 2024.
• The company has a payable amount owed to its former CEO of $127,393 as of September 30, 2024.
• There are material weaknesses in the company's internal controls over financial reporting.

Risks

• The company's ability to continue as a going concern is in doubt due to its accumulated deficit and lack of operating activities.
• The company is dependent on raising additional capital to fund its operations and there is no assurance that it can do so on satisfactory terms.
• The company's success is dependent on acquiring a new and profitable operating business, which is not guaranteed.
• The company has material weaknesses in its internal controls over financial reporting.
• The company has a history of changes in management and business focus, which could create instability.

Future Outlook

The company's management is focused on seeking out a new and profitable operating business with strong growth potential and expects expenses to mainly consist of legal, accounting, and filing fees until a successful acquisition is made. The company anticipates continuing to rely on equity sales of its common shares and shareholder advances to fund its operations.

Management Comments

• The company's management efforts are focused on seeking out a new and profitable operating business with rapid growth potential.
• Management intends to fund the ongoing operations of the Company while seeking potential business acquisition opportunities.
• The company's management believes that its current cash and other sources of liquidity are adequate to support operations for at least the next 12 months.

Industry Context

The company's situation is not uncommon for shell companies that are seeking a new business direction. The lack of revenue and ongoing losses are typical for such entities, and the focus on finding a new operating business is a common strategy. The company's challenges highlight the risks associated with investing in shell companies.

Comparison to Industry Standards

• It is difficult to compare Yong Bai Chao New Retail Corporation to industry standards due to its status as a shell company with no current operations.
• The company's financial metrics, such as zero revenue and a significant accumulated deficit, are not comparable to established companies in the retail or technology sectors.
• The company's situation is more akin to other shell companies or special purpose acquisition companies (SPACs) that are actively seeking a merger or acquisition target.
• Unlike established companies, Yong Bai Chao New Retail Corporation does not have a track record of revenue generation or profitability to compare against industry benchmarks.
• The company's reliance on equity sales and shareholder advances for funding is also typical of shell companies, which are not comparable to companies with established revenue streams and access to traditional financing.

Management Changes

Legal Proceedings

• The company is not currently a party to any lawsuit or proceeding which, in the opinion of management, is likely to have a material adverse effect on us or our business.

Related Party Transactions

• The company has a payable amount owed to its former CEO, Fei Wang, of $127,393 as of September 30, 2024.

Stakeholder Impact

• Shareholders face significant risk due to the company's lack of revenue, ongoing losses, and going concern issues.
• Employees are not directly impacted as the company has minimal operations.
• Customers and suppliers are not impacted as the company has no current business operations.
• Creditors are at risk due to the company's liabilities and lack of cash.

Next Steps

• The company will continue to seek a new and profitable operating business with strong growth potential.
• The company will continue to fund its operations through equity sales and shareholder advances.
• The company will need to address the material weaknesses in its internal controls over financial reporting.

Key Dates

Keywords

New Retail, Financial Results, Shell Company, Operating Expenses, Net Loss, Working Capital, Going Concern, Capital Resources, Reverse Stock Split, SEC Reporting