10-Q/A: United Express Inc. Reports Q2 2024 Results, Includes $13 Million Acquisition of Fighting Leagues

United Express Inc.'s Q2 2024 report details a $13 million acquisition of Jebour Two Ltd and its subsidiary, Fighting Leagues LV Inc., alongside financial results showing a net loss of $1.99 million for the six-month period.

Summary

• United Express Inc. filed an amended 10-Q report for the quarter ended December 31, 2023, which includes an update on the $13 million acquisition of Jebour Two Ltd and its subsidiary, Fighting Leagues LV Inc.
• The company's financial statements show a net loss of $1,988,662 for the six months ended December 31, 2023, compared to a net loss of $624 for the same period in 2022.
• Revenue for the six months ended December 31, 2023, was $163,635, while the revenue for the same period in 2022 was $179,537.
• The company issued 12,380,951 shares of common stock for the acquisition of Jebour Two Ltd and 1,400,000 shares for consultancy fees.
• As of December 31, 2023, the company had $27,947 in cash and 29,372,951 shares of common stock outstanding.
• The company's operations include transportation, logistics, and combat sports promotion.

Sentiment

Score: 3

Explanation: The document highlights significant losses, low cash reserves, and a going concern issue, overshadowing the positive acquisition. The overall sentiment is negative due to financial instability.

Positives

• The acquisition of Fighting Leagues LV Inc. provides the company with a license to produce live combat sports events in Nevada, a key asset.
• The company has expanded its business operations to include combat sports promotion and media rights sales.
• The company has a new director, Ralph White, with extensive experience in the fintech industry.

Negatives

• The company experienced a significant net loss of $1,988,662 for the six months ended December 31, 2023.
• The company's revenue decreased from $179,537 in 2022 to $163,635 in 2023 for the six-month period.
• The company's cash balance is low at $27,947 as of December 31, 2023.
• The company's financial statements raise substantial doubt about its ability to continue as a going concern.

Risks

• The company's financial statements raise substantial doubt about its ability to continue as a going concern.
• The company's revenues are concentrated in a few customers, which poses a risk if those customers reduce their orders or cease to use the company's services.
• The company needs to raise additional capital for working purposes, and there is no assurance that such financing will be available.
• The company is still in the process of allocating the purchase price of the acquisition to the acquired assets, which needs to be completed within 12 months.
• Fluctuations in oil prices can impact the company's transportation and logistics costs.

Future Outlook

The company's future capital requirements will depend on the success of its development efforts and its ability to raise capital, with no assurance that such financing will be available.

Management Comments

• Management anticipates that the business will receive orders for service from companies seeking to move merchandise, as well as, people relocating to different areas of the target regional market areas.
• Management believes the Company needs to raise additional capital for working purposes.
• Management is working to allocate the purchase price of the acquisition within 12 months.

Industry Context

The company's expansion into combat sports promotion diversifies its revenue streams beyond transportation and logistics, potentially capitalizing on the growing popularity of combat sports events and media rights.

Comparison to Industry Standards

• The company's revenue of $163,635 for the six months ended December 31, 2023, is relatively low compared to established logistics and transportation companies.
• The net loss of $1,988,662 for the same period is significant and indicates the company is not yet profitable.
• The acquisition of a combat sports promotion company is a unique move and difficult to compare to standard industry benchmarks.
• The company's cash balance of $27,947 is very low compared to industry standards for companies with similar operations.

Management Changes

Legal Proceedings

• The Company is not currently a party to any material legal proceedings.

Related Party Transactions

• There were no related party transactions for the three months period ended December 31, 2023 or December 31, 2022.

Stakeholder Impact

• Shareholders face increased risk due to the company's financial instability and going concern issue.
• Employees may be impacted by the company's financial challenges and potential need for restructuring.
• Customers may experience changes in service due to the company's financial situation.
• Suppliers and creditors face increased risk due to the company's financial instability.

Next Steps

• The company needs to complete the allocation of the purchase price for the acquisition within 12 months.
• The company needs to raise additional capital for working purposes.
• The company needs to conduct an audit on the financial statements for both Jebour Two Ltd and Fighting Leagues LV Inc.

Key Dates

Keywords

acquisition, fighting leagues, combat sports, logistics, transportation, financial results, share issuance, consulting, going concern