10-Q: BALLY, CORP. Reports Q3 2024 Results: No Revenue, Increasing Losses, and Going Concern Uncertainty

BALLY, CORP. reports no revenue and increased net losses for the quarter ended June 30, 2024, raising substantial doubt about its ability to continue as a going concern.

Summary

• BALLY, CORP. filed its Form 10-Q for the quarter ended June 30, 2024.
• The company reported no revenue for both the three and nine months ended June 30, 2024 and 2023.
• Net loss for the three months ended June 30, 2024, was $10,297, compared to $5,235 for the same period in 2023.
• Net loss for the nine months ended June 30, 2024, was $64,894, compared to $32,375 for the same period in 2023.
• The company's working capital deficiency as of June 30, 2024, was $242,226, compared to $177,332 as of September 30, 2023.
• The accumulated deficit as of June 30, 2024, was $421,606.
• The financial statements have been prepared on a going concern basis, but the company's financial condition raises substantial doubt about its ability to continue as a going concern.
• The company is seeking new business opportunities for merger or acquisition.
• A change in control occurred on January 12, 2024, with new shareholders and officers appointed.
• The company is reliant on loans from affiliated parties to fund operations.

Sentiment

Score: 2

Explanation: The sentiment is very negative due to the lack of revenue, increasing losses, working capital deficiency, accumulated deficit, and going concern uncertainty. The company is reliant on related-party loans and has ineffective disclosure controls and procedures.

Positives

• The company is actively seeking new business opportunities through mergers or acquisitions.
• New shareholders have provided advances to cover operating expenses after the change in control.

Negatives

• The company has not generated any revenue since inception.
• The company is experiencing increasing net losses.
• The company has a significant working capital deficiency.
• The company has a substantial accumulated deficit.
• There is substantial doubt about the company's ability to continue as a going concern.
• The company is reliant on loans from affiliated parties to fund operations.
• The company's disclosure controls and procedures were not effective as of the end of the period covered by this quarterly report.

Risks

• The company's ability to continue as a going concern is uncertain.
• The company may be unable to acquire the financing necessary to pursue its plan of operation.
• The company may have difficulties raising capital from other sources.
• Shareholders may lose some or all of their investment.
• The selection of a business opportunity will be complex and without certainty of success.
• The company's disclosure controls and procedures were not effective as of the end of the period covered by this quarterly report.
• The lack of a functioning audit committee and the lack of a majority of outside directors on our board of directors results in ineffective oversight in the establishment and monitoring of required internal controls and procedures, which could result in a material misstatement in our financial statements in future periods.

Future Outlook

The company is seeking new business opportunities with established business entities for merger with or acquisition of a target business, but there is no assurance of success.

Management Comments

• Management believes that there are benefits to being a reporting company with a class of securities quoted on the OTC Markets.
• Management intends to raise additional funds through public or private placement offerings, but there are no current plans or intentions to do so.

Industry Context

Given the company's lack of revenue and reliance on related-party loans, it is difficult to compare it to industry standards. The company's current strategy of seeking a merger or acquisition is common for shell companies or companies seeking a turnaround.

Comparison to Industry Standards

• It is difficult to compare BALLY, CORP. to industry standards due to its lack of revenue and unique situation as a company seeking a merger or acquisition target.
• Many shell companies or companies seeking a turnaround strategy often pursue mergers or acquisitions to revitalize their business.
• Without specific industry comparables, it's challenging to benchmark BALLY, CORP.'s performance against industry peers.

Management Changes

Related Party Transactions

• The company's prior shareholder and sole director and officer (Haiping Hu) assigned the outstanding balance due from the Company through the change of control in the amount of $252,213 to two new shareholders (Kaichen Zheng, also the current sole director and Shitong Li, also the current sole officer) by 50% each.
• The company is obligated to the current shareholders for a total balance of $273,676 (including assigned balance of $252,213 from prior shareholder), which is unsecured, non-interest-bearing and due on demand.

Stakeholder Impact

• Shareholders face the risk of losing some or all of their investment due to the company's financial difficulties.
• The company's employees (if any) face uncertainty due to the company's going concern issues.
• The company's creditors face the risk of not being repaid due to the company's financial difficulties.

Next Steps

• The company intends to seek new business opportunities with established business entities for merger with or acquisition of a target business.
• Management intends to raise additional funds through public or private placement offerings, but there are no current plans or intentions to do so.

Key Dates

Keywords

going concern, net loss, working capital deficiency, accumulated deficit, change in control, merger, acquisition, financial statements, BALLY, CORP., 10-Q