2024 Q3 Form 10-Q Financial Statement

#000149315224033173 Filed on August 19, 2024

View on sec.gov

Income Statement

Concept 2024 Q3 2024 Q2 2023 Q2
Revenue $672.1K $460.6K
YoY Change 45.9% 115.05%
Cost Of Revenue $180.3K $64.88K
YoY Change 177.85% -38.56%
Gross Profit $491.8K $395.8K
YoY Change 24.26% -26.3%
Gross Profit Margin 73.18% 85.92%
Selling, General & Admin $776.3K $1.655M
YoY Change -53.09% 34.82%
% of Gross Profit 157.85% 418.16%
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $21.16K $15.36K
YoY Change 37.73% 90.37%
% of Gross Profit 4.3% 3.88%
Operating Expenses $776.3K $1.655M
YoY Change -53.09% 34.82%
Operating Profit -$284.5K -$1.259M
YoY Change -77.41% 82.35%
Interest Expense
YoY Change
% of Operating Profit
Other Income/Expense, Net -$1.087K -$10.23K
YoY Change -89.37% -2022.93%
Pretax Income -$285.6K -$1.269M
YoY Change -77.5% 83.97%
Income Tax $2.665K
% Of Pretax Income
Net Earnings -$292.5K -$1.269M
YoY Change -76.96% 98.45%
Net Earnings / Revenue -43.53% -275.57%
Basic Earnings Per Share $0.00 $0.00
Diluted Earnings Per Share $0.00 $0.00
COMMON SHARES
Basic Shares Outstanding 400.0M shares 400.0M shares 400.0M shares
Diluted Shares Outstanding 400.0M shares 400.0M shares

Balance Sheet

Concept 2024 Q3 2024 Q2 2023 Q2
SHORT-TERM ASSETS
Cash & Short-Term Investments
YoY Change
Cash & Equivalents $294.7K $540.3K
Short-Term Investments
Other Short-Term Assets
YoY Change
Inventory $17.64K
Prepaid Expenses $130.0K $309.4K
Receivables
Other Receivables $309.4K
Total Short-Term Assets $765.5K $1.256M
YoY Change -39.04% 29.25%
LONG-TERM ASSETS
Property, Plant & Equipment $579.0K $86.95K
YoY Change 565.9% -21.71%
Goodwill
YoY Change
Intangibles $2.550K $2.913K
YoY Change -12.46% 27.99%
Long-Term Investments
YoY Change
Other Assets $69.69K $4.489K
YoY Change 1452.55% -91.24%
Total Long-Term Assets $932.7K $653.8K
YoY Change 42.67% -15.5%
TOTAL ASSETS
Total Short-Term Assets $765.5K $1.256M
Total Long-Term Assets $932.7K $653.8K
Total Assets $1.698M $1.909M
YoY Change -11.06% 9.41%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $1.799M
YoY Change 141.62%
Accrued Expenses
YoY Change
Deferred Revenue $938.9K
YoY Change
Short-Term Debt
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $7.752M $7.666M
YoY Change 1.12% 78.38%
LONG-TERM LIABILITIES
Long-Term Debt
YoY Change
Other Long-Term Liabilities
YoY Change
Total Long-Term Liabilities $410.8K $164.2K
YoY Change 150.17% -48.82%
TOTAL LIABILITIES
Total Short-Term Liabilities $7.752M $7.666M
Total Long-Term Liabilities $410.8K $164.2K
Total Liabilities $8.163M $7.830M
YoY Change 4.25% 69.54%
SHAREHOLDERS EQUITY
Retained Earnings -$7.193M -$6.276M
YoY Change 14.62% 130.42%
Common Stock $40.00K $40.00K
YoY Change 0.0% 900.0%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity -$6.154M -$5.640M
YoY Change
Total Liabilities & Shareholders Equity $1.698M $1.909M
YoY Change -11.06% 9.41%

Cashflow Statement

Concept 2024 Q3 2024 Q2 2023 Q2
OPERATING ACTIVITIES
Net Income -$292.5K -$1.269M
YoY Change -76.96% 98.45%
Depreciation, Depletion And Amortization $21.16K $15.36K
YoY Change 37.73% 90.37%
Cash From Operating Activities
YoY Change
INVESTING ACTIVITIES
Capital Expenditures
YoY Change
Acquisitions
YoY Change
Other Investing Activities
YoY Change
Cash From Investing Activities
YoY Change
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities
YoY Change
NET CHANGE
Cash From Operating Activities
Cash From Investing Activities
Cash From Financing Activities
Net Change In Cash
YoY Change
FREE CASH FLOW
Cash From Operating Activities
Capital Expenditures
Free Cash Flow
YoY Change

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CY2024Q2 us-gaap Other Nonoperating Income Expense
OtherNonoperatingIncomeExpense
-1110 usd
CY2024Q2 us-gaap Nonoperating Income Expense
NonoperatingIncomeExpense
-1087 usd
CY2024Q2 us-gaap Income Loss From Continuing Operations Before Income Taxes Extraordinary Items Noncontrolling Interest
IncomeLossFromContinuingOperationsBeforeIncomeTaxesExtraordinaryItemsNoncontrollingInterest
-285571 usd
CY2024Q2 us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
2665 usd
us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
16029 usd
CY2024Q2 us-gaap Profit Loss
ProfitLoss
-288326 usd
CY2024Q2 us-gaap Net Income Loss Attributable To Noncontrolling Interest
NetIncomeLossAttributableToNoncontrollingInterest
4297 usd
us-gaap Net Income Loss Attributable To Noncontrolling Interest
NetIncomeLossAttributableToNoncontrollingInterest
-30009 usd
CY2024Q2 us-gaap Net Income Loss
NetIncomeLoss
-292533 usd
CY2024Q2 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
OtherComprehensiveIncomeLossForeignCurrencyTransactionAndTranslationAdjustmentNetOfTax
22608 usd
CY2024Q2 us-gaap Comprehensive Income Net Of Tax Including Portion Attributable To Noncontrolling Interest
ComprehensiveIncomeNetOfTaxIncludingPortionAttributableToNoncontrollingInterest
-265628 usd
CY2024Q2 us-gaap Comprehensive Income Net Of Tax Attributable To Noncontrolling Interest
ComprehensiveIncomeNetOfTaxAttributableToNoncontrollingInterest
4297 usd
us-gaap Comprehensive Income Net Of Tax Attributable To Noncontrolling Interest
ComprehensiveIncomeNetOfTaxAttributableToNoncontrollingInterest
-30009 usd
CY2024Q2 us-gaap Comprehensive Income Net Of Tax
ComprehensiveIncomeNetOfTax
-269925 usd
CY2024Q2 us-gaap Earnings Per Share Basic
EarningsPerShareBasic
-0.0007
CY2024Q2 us-gaap Earnings Per Share Diluted
EarningsPerShareDiluted
-0.0007
CY2023Q2 us-gaap Earnings Per Share Diluted
EarningsPerShareDiluted
-0.0032
us-gaap Earnings Per Share Basic
EarningsPerShareBasic
-0.0035
us-gaap Earnings Per Share Diluted
EarningsPerShareDiluted
-0.0035
us-gaap Earnings Per Share Basic
EarningsPerShareBasic
-0.007
us-gaap Earnings Per Share Diluted
EarningsPerShareDiluted
-0.007
CY2024Q2 us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
400000000 shares
CY2024Q2 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
400000000 shares
CY2023Q2 us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
400000000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
400000000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
400000000 shares
us-gaap Weighted Average Number Of Shares Outstanding Basic
WeightedAverageNumberOfSharesOutstandingBasic
400000000 shares
us-gaap Weighted Average Number Of Diluted Shares Outstanding
WeightedAverageNumberOfDilutedSharesOutstanding
400000000 shares
CY2023Q3 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
-5019621 usd
us-gaap Net Income Loss
NetIncomeLoss
-1390047 usd
us-gaap Net Income Loss Attributable To Noncontrolling Interest
NetIncomeLossAttributableToNoncontrollingInterest
-30009 usd
us-gaap Other Comprehensive Income Foreign Currency Translation Adjustment Tax Portion Attributable To Parent
OtherComprehensiveIncomeForeignCurrencyTranslationAdjustmentTaxPortionAttributableToParent
-25245 usd
CY2024Q2 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
-6464924 usd
CY2022Q3 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
-3655583 usd
CY2022Q3 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
-3655583 usd
us-gaap Net Income Loss
NetIncomeLoss
-2621745 usd
us-gaap Adjustments To Additional Paid In Capital Other
AdjustmentsToAdditionalPaidInCapitalOther
204085 usd
us-gaap Other Comprehensive Income Foreign Currency Translation Adjustment Tax Portion Attributable To Parent
OtherComprehensiveIncomeForeignCurrencyTranslationAdjustmentTaxPortionAttributableToParent
152425 usd
CY2023Q2 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
-5920818 usd
CY2023Q2 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest
-5920818 usd
CY2022Q4 us-gaap Stockholders Equity Note Stock Split
StockholdersEquityNoteStockSplit
forward stock split effected on October 18, 2022
KPEA Profit Losses
ProfitLosses
-1404027 usd
KPEA Profit Losses
ProfitLosses
-2621745 usd
us-gaap Depreciation And Amortization
DepreciationAndAmortization
87880 usd
us-gaap Depreciation And Amortization
DepreciationAndAmortization
46525 usd
us-gaap Operating Lease Right Of Use Asset Amortization Expense
OperatingLeaseRightOfUseAssetAmortizationExpense
242219 usd
us-gaap Increase Decrease In Prepaid Expense
IncreaseDecreaseInPrepaidExpense
113014 usd
us-gaap Increase Decrease In Other Receivables
IncreaseDecreaseInOtherReceivables
256820 usd
us-gaap Increase Decrease In Security Deposits
IncreaseDecreaseInSecurityDeposits
-1385 usd
us-gaap Increase Decrease In Inventories
IncreaseDecreaseInInventories
-93253 usd
us-gaap Increase Decrease In Accounts Payable
IncreaseDecreaseInAccountsPayable
175126 usd
us-gaap Increase Decrease In Accounts Payable
IncreaseDecreaseInAccountsPayable
1052509 usd
us-gaap Increase Decrease In Other Accounts Payable And Accrued Liabilities
IncreaseDecreaseInOtherAccountsPayableAndAccruedLiabilities
520387 usd
us-gaap Increase Decrease In Other Accounts Payable And Accrued Liabilities
IncreaseDecreaseInOtherAccountsPayableAndAccruedLiabilities
161547 usd
us-gaap Increase Decrease In Deferred Revenue
IncreaseDecreaseInDeferredRevenue
-955853 usd
us-gaap Increase Decrease In Deferred Revenue
IncreaseDecreaseInDeferredRevenue
1370302 usd
us-gaap Increase Decrease In Employee Related Liabilities
IncreaseDecreaseInEmployeeRelatedLiabilities
26746 usd
us-gaap Increase Decrease In Employee Related Liabilities
IncreaseDecreaseInEmployeeRelatedLiabilities
10930 usd
us-gaap Increase Decrease In Due To Related Parties
IncreaseDecreaseInDueToRelatedParties
1531003 usd
us-gaap Increase Decrease In Due To Related Parties
IncreaseDecreaseInDueToRelatedParties
-12020 usd
us-gaap Increase Decrease In Accrued Income Taxes Payable
IncreaseDecreaseInAccruedIncomeTaxesPayable
-14670 usd
us-gaap Increase Decrease In Accrued Income Taxes Payable
IncreaseDecreaseInAccruedIncomeTaxesPayable
124620 usd
us-gaap Increase Decrease In Operating Lease Liability
IncreaseDecreaseInOperatingLeaseLiability
-111502 usd
us-gaap Increase Decrease In Operating Lease Liability
IncreaseDecreaseInOperatingLeaseLiability
-187951 usd
us-gaap Net Cash Provided By Used In Operating Activities
NetCashProvidedByUsedInOperatingActivities
-206462 usd
us-gaap Net Cash Provided By Used In Operating Activities
NetCashProvidedByUsedInOperatingActivities
142789 usd
us-gaap Payments To Acquire Intangible Assets
PaymentsToAcquireIntangibleAssets
1177 usd
us-gaap Net Cash Provided By Used In Investing Activities
NetCashProvidedByUsedInInvestingActivities
-1177 usd
us-gaap Proceeds From Contributions From Parent
ProceedsFromContributionsFromParent
200327 usd
us-gaap Net Cash Provided By Used In Financing Activities
NetCashProvidedByUsedInFinancingActivities
200327 usd
us-gaap Effect Of Exchange Rate On Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents
EffectOfExchangeRateOnCashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents
43557 usd
us-gaap Effect Of Exchange Rate On Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents
EffectOfExchangeRateOnCashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents
-33281 usd
us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents Period Increase Decrease Including Exchange Rate Effect
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsPeriodIncreaseDecreaseIncludingExchangeRateEffect
-162905 usd
us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents Period Increase Decrease Including Exchange Rate Effect
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsPeriodIncreaseDecreaseIncludingExchangeRateEffect
308658 usd
CY2023Q3 us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents
457580 usd
CY2022Q3 us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents
267131 usd
CY2024Q2 us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents
294675 usd
CY2023Q2 us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents
CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents
575789 usd
CY2022Q4 us-gaap Common Stock Shares Authorized
CommonStockSharesAuthorized
200000000 shares
CY2022Q4 us-gaap Common Stock Par Or Stated Value Per Share
CommonStockParOrStatedValuePerShare
0.0001
CY2022Q4 us-gaap Common Stock Shares Authorized
CommonStockSharesAuthorized
1000000000 shares
CY2022Q4 us-gaap Common Stock Par Or Stated Value Per Share
CommonStockParOrStatedValuePerShare
0.0001
CY2022Q4 us-gaap Common Stock Shares Issued
CommonStockSharesIssued
400000000 shares
CY2022Q4 us-gaap Common Stock Shares Outstanding
CommonStockSharesOutstanding
400000000 shares
us-gaap Use Of Estimates
UseOfEstimates
<p id="xdx_840_eus-gaap--UseOfEstimates_zkhNRDqyliq" style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><span style="text-decoration: underline"><span id="xdx_86F_zYjDaHKoTON5">Use of Estimates and Assumptions</span></span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The preparation of the condensed consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that impact the presented amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the presented amounts of revenues and expenses during the period. Actual results may differ from those estimates. Significant estimates during the nine months ended June 30, 2024 and 2023 include the collectability of receivables, the valuation of inventory, the useful lives of long-lived assets and intangibles, the assumptions used in assessing impairment of long-lived assets, the valuation of accruals for expenses and tax due.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p>
us-gaap Net Cash Provided By Used In Operating Activities
NetCashProvidedByUsedInOperatingActivities
-206462 usd
KPEA Net Income Losses
NetIncomeLosses
-1131821 usd
CY2024Q2 KPEA Working Capital Deficit
WorkingCapitalDeficit
6986827 usd
us-gaap Proceeds From Related Party Debt
ProceedsFromRelatedPartyDebt
1500000 usd
CY2024Q2 us-gaap Accumulated Other Comprehensive Income Loss Net Of Tax
AccumulatedOtherComprehensiveIncomeLossNetOfTax
401292 usd
CY2023Q3 us-gaap Accumulated Other Comprehensive Income Loss Net Of Tax
AccumulatedOtherComprehensiveIncomeLossNetOfTax
426741 usd
CY2024Q2 us-gaap Inventory Gross
InventoryGross
17644 usd
us-gaap Selling Expense
SellingExpense
1174826 usd
us-gaap Selling Expense
SellingExpense
2323347 usd
KPEA Sales Commissions Expense
SalesCommissionsExpense
791232 usd
KPEA Sales Commissions Expense
SalesCommissionsExpense
1506180 usd
us-gaap Concentration Risk Credit Risk
ConcentrationRiskCreditRisk
<p id="xdx_84D_eus-gaap--ConcentrationRiskCreditRisk_zkMKkBHXFW77" style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"><span style="text-decoration: underline"><span id="xdx_860_zgZdSmrp2IFa">Concentration of Risk</span></span></span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Credit risk</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents and other receivables. As of June 30, 2024 and September 30, 2023, $<span id="xdx_90F_eus-gaap--Deposits_iI_c20240630_zrCm9Ni7oSe8" title="Deposits">604,045</span> (RMB<span id="xdx_90C_eus-gaap--Deposits_iI_uRMB_c20240630_zXkYkFmYFaDe" title="Deposits">4,389,715</span>) and $<span id="xdx_903_eus-gaap--Deposits_iI_c20230930_zfleu5KRb4ch" title="Deposits">449,946</span> (RMB <span id="xdx_902_eus-gaap--Deposits_iI_uRMB_c20230930_zzjQgVp8SwIi" title="Deposits">3,123,333</span>), respectively, were deposited with various major financial institutions located in the PRC. While management believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Historically, deposits in Chinese banks are secure due to state policy to protect depositor interests. However, China promulgated a Bankruptcy Law in August 2006 that came into effect on June 1, 2007, which contains a separate article expressly stating that the State Council may promulgate implementation measures to provide for the bankruptcy of Chinese banks based on the Bankruptcy Law. Under the current Bankruptcy Law, a Chinese bank may file bankruptcy if it deems itself to be insolvent. In addition, since China’s concession to the World Trade Organization, foreign banks have been gradually permitted to operate in China and have intensified competition in many aspects, especially since the opening of the Renminbi business to foreign banks in late 2006. Therefore, the risk of bankruptcy at the institutions that the Company maintains deposits has increased. In the event of bankruptcy, the Company is unlikely to reclaim its deposits in full since it is unlikely to be classified as a secured creditor under PRC laws.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0.05pt; text-align: justify; text-indent: -0.05pt"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Risks of variable interest entity structure</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0.05pt; text-align: justify; text-indent: -0.05pt"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">As of the date of this report, King Eagle (Tianjin) has established five subsidiaries, King Eagle (Beijing) Technology Co., Ltd, King Eagle (Huai’an) Health Management Co., Ltd., Kun Zhi Jian (Huai’an) Technology Co., Ltd<b>.</b>, Kun Zhi Jian (Shandong) Health Management Co., Ltd, and Chengdu Wenjiang Pengrun Internet Healthcare Co., Ltd on December 1, 2022, September 19, 2023, October 26, 2023, January 31, 2024, and February 1, 2024, respectively, in the PRC. King Eagle (Tianjin) is the controlling shareholder under the company laws of the PRC. The binding rights over the VIE’s subsidiaries in the contractual arrangements between King Eagle (China) and King Eagle (Tianjin) are implicit and indirect and the company laws and regulations in the PRC governing the business operations of the VIE’s subsidiaries are uncertain.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">In the opinion of management, (i) the corporate structure of the Company is in compliance with existing PRC laws and regulations; (ii) the VIE Agreements are valid and binding and do not result in any violation of PRC laws or regulations currently in effect; and (iii) the business operations of the foreign-invested enterprise and the VIE are in compliance with existing PRC laws and regulations in all material respects.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">However, there are substantial uncertainties regarding the interpretation and application of current and future PRC laws and regulations. Accordingly, the Company cannot be assured that PRC regulatory authorities will not ultimately take a contrary view to the foregoing opinion of its management. If the current corporate structure of the Company or the VIE Agreements is found to be in violation of any existing or future PRC laws and regulations, the Company may be required to restructure its corporate structure and operations in the PRC to comply with changing and new PRC laws and regulations. In the opinion of management, the likelihood of loss in respect of the Company’s current corporate structure or the VIE Agreements is remote based on current facts and circumstances.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Foreign currency exchange risk</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">The value of the RMB against the U.S. dollar and other currencies may fluctuate and is affected by, among other things, changes in political and economic conditions and the foreign exchange policy adopted by the PRC government. It is difficult to predict how market forces or PRC or U.S. government policy may impact the exchange rate between the RMB and the U.S. dollar in the future. There remains significant international pressure on the PRC government to adopt a more flexible currency policy, which could result in greater fluctuation of the RMB against the U.S. dollar. The Company is a holding company and it relies on dividends paid by the Company’s operating subsidiaries in China for its cash needs. Any significant revaluation of the RMB may materially and adversely affect its liquidity and cash flows. To the extent that the Company needs to convert U.S. dollars into RMB for its operations, appreciation of the RMB against the U.S. dollar would have an adverse effect on the RMB amount the Company would receive. Conversely, if the Company decides to convert RMB into U.S. dollars for other business purposes, appreciation of the U.S. dollar against the RMB would have a negative effect on the U.S. dollar amount the Company would receive.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Liquidity risk</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Liquidity risk is the risk that the Company will encounter difficulty raising liquid funds to meet commitments as they fall due. See our commitments and contingencies in Note 16, Financial Statements and Supplementary Data. In meeting its liquidity requirements, the Company continues to focus on increasing its revenue through the sale of consumer health care products through its Kun Zhi Jian Mini Program and promoting its own brand of preventive health care related products on its new online platform to reduce its costs of goods sold, streamlining its overhead costs, or obtaining financing from its stockholders or directors.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 7.25pt; text-align: justify; text-indent: -7.3pt"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">Concentration of customers and vendors</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">There was no revenue from customers that individually represent greater than <span id="xdx_905_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20231001__20240630__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomersMember_z083q2zFblad" title="Concentration risk percentage"><span id="xdx_90B_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20221001__20230630__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--CustomersMember_zjzcTh9pZnka" title="Concentration risk percentage">10</span></span>% of the total revenues for the nine months ended June 30, 2024 and 2023.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">For the nine months ended June 30, 2024, one major vendor accounted for <span id="xdx_904_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20231001__20240630__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--VendorOneMember_zohhHrAeFFz1">10.7</span>% of the Company’s total cost of sales.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt; text-align: justify; text-indent: 0.5in"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt">For the nine months ended June 30, 2023, one major vendor accounted for <span id="xdx_903_eus-gaap--ConcentrationRiskPercentage1_pid_dp_uPure_c20221001__20230630__us-gaap--ConcentrationRiskByBenchmarkAxis__us-gaap--SalesRevenueNetMember__us-gaap--ConcentrationRiskByTypeAxis__us-gaap--CustomerConcentrationRiskMember__srt--MajorCustomersAxis__custom--VendorOneMember_zvKjEGVYTtK7">30.9</span>% of the Company’s total cost of sales.</span></p> <p style="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0pt 0pt 0; text-align: justify"><span style="font-family: Times New Roman, Times, Serif; font-size: 10pt"> </span></p>
CY2024Q2 us-gaap Deposits
Deposits
604045 usd
CY2024Q2 us-gaap Deposits
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CY2024Q2 us-gaap Property Plant And Equipment Net
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Depreciation
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us-gaap Depreciation
Depreciation
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us-gaap Depreciation
Depreciation
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CY2024Q2 us-gaap Finite Lived Intangible Assets Accumulated Amortization
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CY2023Q3 us-gaap Finite Lived Intangible Assets Accumulated Amortization
FiniteLivedIntangibleAssetsAccumulatedAmortization
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CY2024Q2 us-gaap Finite Lived Intangible Asset Useful Life
FiniteLivedIntangibleAssetUsefulLife
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CY2024Q2 us-gaap Amortization Of Intangible Assets
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CY2023Q2 us-gaap Amortization Of Intangible Assets
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us-gaap Amortization Of Intangible Assets
AmortizationOfIntangibleAssets
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us-gaap Amortization Of Intangible Assets
AmortizationOfIntangibleAssets
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CY2024Q2 KPEA Advance Payments From Customers
AdvancePaymentsFromCustomers
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AdvancePaymentsFromCustomers
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CommonStockSharesOutstanding
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CY2023Q3 us-gaap Common Stock Shares Outstanding
CommonStockSharesOutstanding
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KPEA Percentage Of After Tax Profits
PercentageOfAfterTaxProfits
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RevenueFromContractWithCustomerExcludingAssessedTax
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CY2023Q2 us-gaap Cost Of Revenue
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us-gaap Cost Of Revenue
CostOfRevenue
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us-gaap Cost Of Revenue
CostOfRevenue
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CY2024Q2 us-gaap Cost Of Revenue
CostOfRevenue
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CY2023Q2 us-gaap Cost Of Revenue
CostOfRevenue
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us-gaap Cost Of Revenue
CostOfRevenue
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us-gaap Cost Of Revenue
CostOfRevenue
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CurrentForeignTaxExpenseBenefit
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CurrentIncomeTaxExpenseBenefit
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us-gaap Income Tax Expense Benefit
IncomeTaxExpenseBenefit
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us-gaap Effective Income Tax Rate Reconciliation At Federal Statutory Income Tax Rate
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us-gaap Effective Income Tax Rate Reconciliation Change In Deferred Tax Assets Valuation Allowance
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us-gaap Effective Income Tax Rate Reconciliation Change In Deferred Tax Assets Valuation Allowance
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us-gaap Effective Income Tax Rate Continuing Operations
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CY2024Q2 us-gaap Operating Lease Right Of Use Asset
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CY2024Q2 us-gaap Operating Lease Liability
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CY2023Q3 us-gaap Operating Lease Liability
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CY2024Q2 us-gaap Lease Cost
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us-gaap Lease Cost
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CY2024Q2 us-gaap Lessee Operating Lease Liability Payments Remainder Of Fiscal Year
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CY2024Q2 us-gaap Lessee Operating Lease Liability Payments Due Next Twelve Months
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CY2024Q2 us-gaap Lessee Operating Lease Liability Payments Due
LesseeOperatingLeaseLiabilityPaymentsDue
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CY2024Q2 us-gaap Lessee Operating Lease Liability Undiscounted Excess Amount
LesseeOperatingLeaseLiabilityUndiscountedExcessAmount
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CY2024Q2 KPEA Operating Lease Liabilities
OperatingLeaseLiabilities
328813 usd
CY2023Q3 us-gaap Lessee Operating Lease Liability Payments Due Next Twelve Months
LesseeOperatingLeaseLiabilityPaymentsDueNextTwelveMonths
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CY2023Q3 us-gaap Lessee Operating Lease Liability Payments Due Year Two
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CY2023Q3 us-gaap Lessee Operating Lease Liability Payments Due
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CY2023Q3 us-gaap Lessee Operating Lease Liability Undiscounted Excess Amount
LesseeOperatingLeaseLiabilityUndiscountedExcessAmount
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CY2023Q3 KPEA Operating Lease Liabilities
OperatingLeaseLiabilities
250018 usd
CY2024Q2 us-gaap Operating Lease Lease Income Lease Payments
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14398 usd
CY2023Q2 us-gaap Operating Lease Lease Income Lease Payments
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us-gaap Operating Lease Lease Income Lease Payments
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111469 usd
us-gaap Operating Lease Lease Income Lease Payments
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CY2024Q2 us-gaap Right Of Use Asset Obtained In Exchange For Operating Lease Liability
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us-gaap Right Of Use Asset Obtained In Exchange For Operating Lease Liability
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us-gaap Right Of Use Asset Obtained In Exchange For Operating Lease Liability
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CY2024Q2 us-gaap Other Depreciation And Amortization
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us-gaap Other Depreciation And Amortization
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216678 usd
us-gaap Other Depreciation And Amortization
OtherDepreciationAndAmortization
237538 usd
CY2024Q2 us-gaap Other Commitment
OtherCommitment
25044 usd
CY2023Q3 us-gaap Other Commitment
OtherCommitment
15327 usd

Files In Submission

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