10-Q: Yong Bai Chao New Retail Corporation Reports Minimal Activity and Ongoing Losses in Q2 2024

Yong Bai Chao New Retail Corporation reported no revenue and continued losses for the second quarter of 2024, as it focuses on identifying a new operating business.

Summary

• Yong Bai Chao New Retail Corporation, formerly known as Environmental Control Corp., reported no revenue for both the three and six months ended June 30, 2024.
• The company incurred a net loss of $9,403 for the three months ended June 30, 2024, and a net loss of $27,236 for the six months ended June 30, 2024.
• Operating expenses decreased to $9,403 for the three months and $27,236 for the six months ended June 30, 2024, primarily due to reduced legal and audit fees.
• The company's accumulated deficit stood at $3,702,944 as of June 30, 2024, with a working capital deficit of $133,895.
• The company has no current operating activities and is focused on seeking a new and profitable operating business.
• Management acknowledges substantial doubt about the company's ability to continue as a going concern for the next twelve months.
• The company's financial statements are unaudited and prepared in accordance with SEC rules and regulations.

Sentiment

Score: 2

Explanation: The sentiment is very negative due to the lack of revenue, ongoing losses, substantial doubt about the company's ability to continue as a going concern, and reliance on equity sales for funding. The company is essentially a shell company with no current operations and significant financial challenges.

Positives

• Operating expenses decreased significantly compared to the same periods in the previous year, indicating cost control efforts.
• The company is actively seeking a new and profitable operating business, which could lead to future growth.

Negatives

• The company has no revenue and continues to incur losses.
• There is substantial doubt about the company's ability to continue as a going concern.
• The company has a significant accumulated deficit and a working capital deficit.
• The company is currently a shell company with no substantial business operations.

Risks

• The company's ability to continue as a going concern is uncertain due to its accumulated deficit and lack of revenue.
• The company's success depends on its ability to acquire a new and profitable operating business.
• The company may need to raise additional capital, which could dilute existing shareholders.
• There is no assurance that the company will be able to find a suitable acquisition target or secure additional funding.

Future Outlook

The company anticipates continuing to rely on equity sales and shareholder advances to fund operations while seeking a new business acquisition.

Management Comments

• Management is focused on seeking out a new and profitable operating business with strong growth potential.
• Management intends to fund the ongoing operations of the Company while seeking potential business acquisition opportunities.
• Management believes that the 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 new business opportunities. The lack of revenue and ongoing losses are typical during this phase, and the focus on finding a new operating business is a common strategy.

Comparison to Industry Standards

• It is difficult to compare Yong Bai Chao New Retail Corporation to industry standards due to its current status as a shell company with no operating activities.
• The company's financial metrics are not comparable to companies with ongoing operations and revenue generation.
• The company's focus on seeking a new business acquisition is a common strategy for shell companies, but the success of this strategy is highly variable and dependent on the specific acquisition target and market conditions.
• The company's lack of cash and significant accumulated deficit are not unusual for shell companies in this stage of development.

Management Changes

Legal Proceedings

• The company may become involved in various lawsuits and legal proceedings in the ordinary course of business.
• The company is not currently a party to any lawsuit or proceeding that is likely to have a material adverse effect on the company or its business.

Related Party Transactions

• The company owes $119,073 to its former CEO, Fei Wang, as of June 30, 2024, for expenses paid on behalf of the company.

Stakeholder Impact

• Shareholders face the risk of dilution due to potential equity sales.
• 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 financial difficulties and going concern issues.

Next Steps

• The company will continue to seek a new and profitable operating business with strong growth potential.
• The company will continue to rely on equity sales and shareholder advances to fund operations.
• The company will evaluate the impact of new accounting pronouncements on its financial statements.

Key Dates

Keywords

financial results, quarterly report, net loss, operating expenses, going concern, shell company, acquisition, capital resources, reverse stock split, SEC filing