ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS.
The following discussion of our financial condition, changes in financial condition, plan of operations and results of operations should be read in conjunction with our unaudited interim consolidated financial statements for the three months and six months ended August 31, 2016 and 2015, together with the notes thereto included in this Form 10-Q. The discussion contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors.
OVERVIEW
Baixo Relocation Services, Inc., a Nevada corporation, was incorporated on January 7, 2014 in the State of Nevada. We previously operated a consulting business whereby we provided personalized relocation services to clients, both individual and corporate, who were relocating to the state of Goa. We assisted clients who intended to relocate to the region for temporary, long-term, and permanent periods. We offered a wide range of relocation services to our clients, including arranging and assisting with transportation in the state of Goa, India, household goods movement, appropriate immigration documentation, real estate rental and purchases, children’s’ education registration, area orientation, housekeeping, utilities connections, banking introductions, local transportation, tax compliance, and language and cultural training.
As of the date of this Quarterly Report, we are deemed to be a shell corporation as defined in Rule 230.405 of the Securities Act and, therefore, issued shares of restricted stock available for sale under Rule 144 may be affected. We must cure ourselves of our shell status by: (i) no longer fitting the definition of a shell company as defined in Rule 144(i)(1); (ii) subjecting to the reporting requirements under the Securities Exchange Act of 1934, as amended, (the "Exchange Act") and filing all reports (other than Form 8-K reports) required under the Exchange Act for the preceding twelve months; and (iii) filing current “Form 10 information” with the Securities and Exchange Commission reflecting our status as an entity that is no longer an issuer described in Rule 144(i)(1) and one year has elapsed since the filing of the "Form 10 information" with the Securities and Exchange Commission.
Change in Control
Effective October 3, 2016, Rosy Rodrigues (“Rodrigues”), the majority shareholder, sole executive officer and member of the Board of Directors of Baixo Relocation Services, Inc., a Nevada corporation (the “Company”) entered into certain stock purchase agreements (collectively, the “Stock Purchase Agreements”) with certain individuals and/or entities (collectively, the “Investors”). In accordance with the terms and provisions of the Stock Purchase Agreements, Rodrigues sold and transferred at a per share price of $0.037 the control block of the Company consisting of 5,000,000 shares of restricted common stock and representing approximately 62.5% of the total issued and outstanding shares of common stock.
RESULTS OF OPERATIONS
The following discussions are based on our consolidated financial statements, including our subsidiaries. These charts and discussions summarize our financial statements for the six months ended August 31, 2016 and August 31, 2015 and should be read in conjunction with the financial statements and notes thereto, included with our most recent Form 10-K for fiscal year ended February 29, 2016.
Balance sheet – as at August 31, 2016 and February 29, 2016
At August 31, 2016, our current assets were $32 and our current liabilities were $300. Current assets comprised $32 in cash and current liabilities comprised of $300 in accrued liabilities.
As of August 31, 2016, our total assets were $32 comprised of $32 in current assets. The decrease in total assets during the six month period ended August 31, 2016 from fiscal year ended February 29, 2016 was primarily due to the decrease in cash of $15,132.
As of August 31, 2016, our total liabilities were $300 comprised of $300 in current liabilities. The slight decrease in liabilities during the six month period ended August 31, 2016 from fiscal year ended February 29, 2016 was primarily due to the decrease in accrued liabilities of $41.
Stockholders’ equity decreased from $15,132 for fiscal year ended February 29, 2016 to $(268) for the six month period ended August 31, 2016.
Statement of Operations
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SUMMARY COMPARISON OF OPERATING RESULTS
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Six Month Period
ended August 31
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2016
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2015
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Total Operating Expenses
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$
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15,400
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$
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22,091
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Net Loss
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(15,400
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)
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(22,091
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Net Loss Per Share
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(0.00
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)
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(0.00
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For the six months ended August 31, 2016 and 2015.
Our net loss for the six month period ended August 31, 2016 was ($15,400) compared to a net loss of ($22,091) during the six month period ended August 31, 2015 (a decrease in net loss of $6,691). We did not generate any revenue during the six month periods ended August 31, 2016 and August 31, 2015, respectively.
During the six month period ended August 31, 2016, we incurred operating expenses of $15,400 compared to $22,091 incurred during the six month period ended August 31, 2015 (a decrease of $6,691). These operating expenses incurred during the six month period ended August 31, 2016 consisted of: (i) general and administrative of $5,688 (2015: $3,313); and (ii) professional fees of $9,712 (2015: $18,778). Operating expenses incurred during the six month period ended August 31, 2016 decreased compared to the six month period ended August 31, 2015 primarily due to a decrease in professional fees of $9,066, partially offset by an increase in General expenses amounting to $2,375.
Our loss from operations during the six month period ended August 31, 2016 was ($15,400) compared to a loss from operations of ($22,091) during the six month period ended August 31, 2015.
During the six month period ended August 31, 2016 and August 31, 2015, respectively, we did not incur any other expense.
Therefore, we realized a net loss of ($15,400) or ($0.002) per share for the six month period ended August 31, 2016 compared to a net loss of ($22,091) or ($0.003) per share for the six month period ended August 31, 2015. The weighted average number of shares outstanding was 8,000,000 for the six month periods ended August 31, 2016 and August 31, 2015, respectively.
For the three months ended August 31, 2016 and 2015.
Our net loss for the three month period ended August 31, 2016 was ($7,416) compared to a net loss of ($14,593) during the three month period ended August 31, 2015 (a decrease in net loss of $7,902). We did not generate any revenue during the three month periods ended August 31, 2016 and August 31, 2015, respectively.
During the three month period ended August 31, 2016, we incurred operating expenses of $7,416 compared to $14,593 incurred during the three month period ended August 31, 2015 (a decrease of $7,902). These operating expenses incurred during the three month period ended August 31, 2016 consisted of: (i) general and administrative of $1,204 (2015: $1,175); and (ii) professional fees of $6,212 (2015: $13,418). Operating expenses incurred during the three month period ended August 31, 2016 decreased compared to the three month period ended August 31, 2015 primarily due to a decrease in professional fees of $7,206.
Our loss from operations during the three month period ended August 31, 2016 was ($7,416) compared to a loss from operations of ($14,593) during the three month period ended August 31, 2015.
During the three month period ended August 31, 2016 and August 31, 2015, respectively, we did not incur any other expense.
Therefore, we realized a net loss of ($7,416) or ($0.001) per share for the three month period ended August 31, 2016 compared to a net loss of ($14,593) or ($0.002) per share for the three month period ended August 31, 2015. The weighted average number of shares outstanding was 8,000,000 for the three month periods ended August 31, 2016 and August 31, 2015, respectively.
LIQUIDITY AND CAPITAL RESOURCE
At August 31, 2016, our current assets were $32 and our current liabilities were $300, which resulted in a working capital deficit of $268. As at August 31, 2016, current assets comprised $32 in cash and current liabilities comprised of $300 in accrued liabilities.
We are actively seeking various financing operations to meet the working capital requirements.
Cash Flows from Operating Activities
We have not generated positive cash flows from operating activities. For the six month period ended August 31, 2016, net cash flows used in operating activities was ($15,441) compared to net cash flows used in operating activities of ($23,416) for the six month period ended August 31, 2015. Net cash flows used in operating activities consisted primarily of a net loss of $15,400 (2015: $22,091), which was partially adjusted by ($41) (2015: ($1,325)) in accounts payable and accrued liabilities.
Cash Flows from Investing Activities
For the six month period ended August 31, 2016 and August 31, 2015, net cash flows used in investing activities was $-0- .
Cash Flows from Financing Activities
For the six month periods ended August 31, 2016 and August 31, 2015, net cash flows provided from financing activities was $-0-.
Our cash balance at August 31, 2016 was $32. If additional funds become required before generation of revenue, the additional funding may come from debt financing or equity financing from the sale of our common stock.
Our future financial results are also uncertain due to a number of factors, some of which are outside our control. These factors include, but are not limited to:
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our ability to raise additional funding;
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interest by online users to retain us for our services which will generate revenue.
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Due to our lack of operating history and present inability to generate revenues, our auditors have stated their opinion that there currently exists a substantial doubt about our ability to continue as a going concern.
The detailed analysis of the risk factors is disclosed our Company’s registration statement Form S-1 as filed with the Securities and Exchange Commission.
Future Financings
As at August 31, 2016, we had a working capital deficit of $268 and we will require additional financing in order to enable us to proceed with our plan of operations.
When we will require additional financing, there can be no assurance that additional financing will be available to us, that it can be obtained on commercially reasonable terms. If we are not able to obtain the additional financing on a timely basis, we will not be able to meet our other obligations as they become due. We are pursuing various alternatives to meet our immediate and long-term financial requirements.
We anticipate continuing to rely on equity sales of our common stock in order to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of equity securities or arrange for debt or other financing to fund our planned business activities.
Our auditor has issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we generate sufficient revenues. There is no assurance we will ever reach that point. In the meantime the continuation of the Company is dependent upon the continued financial support from our shareholders, our ability to obtain necessary equity financing to continue operations and the attainment of profitable operations.
Our operations and financial results are subject to various risks and uncertainties that could adversely affect our business, financial condition and results of operations.
We require approximately $15,000 for the next 12 months as a reporting issuer and additional funds are required. Before generation of revenue, the additional funding may come from equity financing from the sale of our common stock or loans from management or related third parties. In the event we do not raise sufficient capital to implement its planned operations or divest, your entire investment could be lost.
Going Concern Consideration
The report of our independent registered public accounting firm for the period ended February 29, 2016 included a going concerned paragraph because of a substantial doubt about our ability to continue as a going concern based on the absence of an established source of revenue, recurring losses from operations, and our need for additional financing in order to fund our operations in fiscal 2017.
Our operations and financial results are subject to various risks and uncertainties that could adversely affect our business, financial condition and results of operations.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements including arrangements that would affect our liquidity, capital resources, market risk support and credit risk support or other benefits.