What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-11-14 compared with 2024-06-11 · 397 added, 320 removed, 393 unchanged (65% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2024 (UNAUDITED) AND JUNE 30, 2023

AS OF SEPTEMBER 30, 2024 AND JUNE 30, 2024

(US$, except share data, or otherwise noted)

September 30,

Current assets

Restricted cash

Accounts receivable and other receivable, net

Other current assets

Deferred share issuance costs

Prepaid expenses

Loan receivable

Loan receivables

Total current assets

Non-current assets

Due from related parties

Restricted cash – non-current

Long-term loan receivables

Property and equipment, net

2 unchanged sentences

Right-of-use assets – finance leases

Other non-current assets

LIABILITIES AND STOCKHOLDERS’ EQUITY

1 unchanged sentence

Accounts payable and accrued liabilities

Contract liabilities

Income taxes payable

3 unchanged sentences

Finance lease liabilities – current

Customer deposits

Total current liabilities

6 unchanged sentences

Stockholders’ equity

Common stock, US$ 0.00001 par value, 100,000,000 shares authorized, 40,000,000 issued and outstanding as of March 31, 2024 and June 30, 2023, respectively

Common stock, US$ 0.00001 par value, 100,000,000 shares authorized, 41,634,000 issued and outstanding as of September 30, 2024 and June 30, 2024, respectively

Additional paid-in capital

3 unchanged sentences

The accompanying notes form an integral part

of these unaudited condensed consolidated financial statements.

of these condensed consolidated financial statements.

HOLDING CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE THREE AND NINE MONTHS ENDED MARCH 31, 2024 AND 2023 (UNAUDITED)

CONDENSED CONSOLIDATED STATEMENTS

OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023

(US$, except share data, or otherwise noted)

September 30,

Costs of sales

Gross profit (loss)

( 3,606,790 )

Operating costs and expenses:

1 unchanged sentence

Total operating costs and expenses

Income from operations

Income (loss) from operations

( 7,275,615 )

Other (income) expenses:

Other income, net

( 1,205,665 )

2 unchanged sentences

( 1,196,657 )

Income before provision for income

Current income tax expense

Deferred income tax expense

Total income tax expenses

Total comprehensive income

Income (loss) before provision for income taxes

( 6,078,958 )

Current income tax expense (recovery)

Deferred income tax expense (recovery)

( 1,373,498 )

Total income tax expenses (recovery)

( 1,431,087 )

Net income (loss)

( 4,647,871 )

Total comprehensive income (loss)

( 4,647,871 )

Basic & diluted net earnings per share

Weighted average number of shares of common stock-basic and diluted

Weighted average number of shares of common stock-basic

Weighted average number of shares of common stock-diluted

The accompanying notes form an integral part

of these unaudited condensed consolidated financial statements.

of these condensed consolidated financial statements.

HOLDING CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKOLDERS’ EQUITY

FOR THE THREE AND NINE MONTHS ENDED MARCH 31, 2024 AND 2023 (UNAUDITED)

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKOLDERS’

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023

(US$, except share data, or otherwise noted)

Nine Months Ended

Balance as of June 30, 2023

Contribution from stockholders

Balance as of March 31, 2024 (unaudited)

Three Months Ended

Balance as of December 31, 2023

Contribution from stockholders

Balance as of March 31, 2024 (unaudited)

Nine Months Ended

Balance as of June 30, 2023

Contribution from stockholders

Balance as of March 31, 2023 (unaudited)

Three Months ended

Balance as of December 31, 2022

Contribution from stockholders

Balance as of March 31, 2023 (unaudited)

Balance as of September 30, 2023 (unaudited)

Balance as of June 30, 2024

Net income (loss)

( 4,647,871 )

Balance as of September 30, 2024 (unaudited)

The accompanying notes form an integral part

of these unaudited condensed consolidated financial statements.

of these condensed consolidated financial statements.

HOLDING CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED MARCH 31, 2024 AND 2023 (UNAUDITED)

FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023 (UNAUDITED)

(US$, except share data, or otherwise noted)

Three Months Ended

September 30,

Three Months Ended

September 30,

Cash Flows from Operating Activities:

Net income (loss)

( 4,647,871 )

Adjustments for items not affecting cash:

Net loss from disposal of fixed assets

Depreciation of property and equipment and right-of-use financial assets

3 unchanged sentences

Deferred income taxes

( 1,373,498 )

Interest income

1 unchanged sentence

Accounts receivable and other receivables

( 7,685,423 )

( 2,553,582 )

Other current assets

( 1,092,348 )

Other non-current assets

Prepaid expenses

1 unchanged sentence

( 1,927,718 )

Customer deposits

( 2,130,478 )

Contract liabilities

Income tax payable

Accrued payroll liabilities

Net cash provided from operating activities

Net cash (used in) provided from operating activities

( 3,603,104 )

Cash Flows from Investing Activities:

2 unchanged sentences

( 1,145,104 )

Purchase of intangible assets

Loan receivable

Loan disbursement

( 1,000,000 )

( 1,019,559 )

Proceeds from loan repayments

Net cash used in investing activities

3 unchanged sentences

Net proceeds received from (repaid to) related parties

( 2,503,233 )

Proceeds (lend to) from related parties

3 unchanged sentences

Net cash provided by (used in) financing activities

Net increase (decrease) in cash and restricted cash

( 4,964,535 )

Net increase in cash, cash equivalents and restricted cash

Cash and cash equivalents, beginning of year

Cash and restricted cash, end of nine months period

Cash and restricted cash, beginning of year

Cash and restricted cash, end of year

The following table provides a reconciliation

of cash and restricted cash reported within the Consolidated Balance Sheets that sum to the total of the same amounts shown in the Consolidated

Statements of Cash Flows:

Restricted cash – non-current

Total cash and restricted cash shown in the Consolidated Balance Sheet

Supplemental Disclosure of Cash Flows Information:

Income taxes paid

Non-cash Transactions:

Right-of-use assets acquired in exchange for operating lease liabilities

IPO expenses paid by stockholders

The accompanying notes form an integral part

of these unaudited condensed consolidated financial statements.

ARMLOGI HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

of these condensed consolidated financial statements.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL

STATEMENTS (UNAUDITED)

Organization and principal activities

5 unchanged sentences

involve arranging shipments, on behalf of its customers, of materials that are generally larger than shipments handled by integrated carriers

of primarily small parcels, such as FedEx, Trucking, and UPS, including arranging and monitoring all aspects of material flow activity

utilizing advanced information technology systems.

The Company also provides other value-added logistics services, including warehousing

services, materials management and distribution services, and customs house brokerage services, to complement its core transportation

service offering.

of primarily small parcels, such as FedEx, and UPS, including arranging and monitoring all aspects of material flow activity utilizing

advanced information technology systems.

The Company also provides other value-added logistics services, including warehousing services,

materials management and distribution services, and customs house brokerage services, to complement its core transportation service offering.

Summary of significant accounting policies

Basis of presentation

accompanying unaudited interim condensed financial statements have been prepared by the Company pursuant to the rules and regulations

Securities and Exchange Commission (the “SEC”).

Accordingly, they do not include all the information and

footnotes required by generally accepted accounting principles in the United States (“U.S.

GAAP”) for complete financial

In the opinion of the Company, all adjustments considered necessary for the fair presentation of the Company’s results

of operations, financial position and cash flows for the periods presented have been included and are of a normal, recurring nature.

results of operations for interim periods are not necessarily indicative of the results to be expected for the year ending June 30,

2024 or for any other future annual or interim period.

These financial statements should be read in conjunction with the Company’s

audited financial statements and notes thereto for the years ended June 30, 2023 and 2022, included in the Company’s

Registration Statement on Form S-1 (File No.

333-274667) .

The accompanying unaudited interim condensed consolidated financial

statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”)

for interim financial information and in accordance with the instructions to Form 10-Q and Article 8 of Regulation S-X of the SEC.

information or footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or

omitted, pursuant to the rules and regulations of the SEC for interim financial reporting.

Accordingly, they do not include all the information

and footnotes necessary for a complete presentation of financial position, results of operations, or cash flows.

The accompanying unaudited

condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included

in our annual Report on Form 10-K for the year ended June 30, 2024.

In the opinion of the Company’s

management, the unaudited interim condensed consolidated financial statements include all adjustments, which are only of a normal

and recurring nature, necessary for a fair statement of the financial position of the Company as of September 30, 2024, and its

results of operations and cash flows for the three-month period then ended.

Operating results for the three months ended September

30, 2024 are not necessarily indicative of the results that may be expected for the fiscal year ended June 30, 2025.

Principal of consolidation

The unaudited condensed consolidated financial

statements include the financial statements of the Company and its subsidiaries.

All transactions and balances among the Company and its

subsidiaries have been eliminated upon consolidation.

unaudited interim condensed consolidated financial statements include the

financial statements of the Company and its subsidiaries.

All transactions and balances among the Company and its subsidiaries have been

eliminated upon consolidation.

Principal activities Percentage of

3 unchanged sentences

Armlogi Holding Corp.

Holding company —

September 27, 2022 Nevada, U.S.

Holding company — September 27, 2022 Nevada, U.S.

Armstrong Logistic Inc.

6 unchanged sentences

Use of Estimates

The preparation of financial statements and related

disclosures in accordance with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of

assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts

preparation of financial statements and related disclosures in accordance with accounting principles generally accepted in the United

States (‘U.S.

GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets

and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts

of revenue and expenses during the reporting period.

There were no critical accounting estimates affecting the unaudited condensed consolidated

financial statements for the nine months ended March 31, 2024 and 2023.

Cash and restricted cash

Cash consist of petty cash on hand and cash held

in banks, which are highly liquid and have original maturities of three months or less and are unrestricted as to withdrawal or use.

Restricted cash represents the cash restricted for two standby letters of credit with Eastwest Bank.

The term of each of the letters of

credit is one year starting from August 1, 2023 and November 7, 2023, respectively.

financial statements for the three months ended September 30, 2024 and 2023.

HOLDING CORP.

1 unchanged sentence

Summary of significant accounting policies

Cash consists of petty cash on hand and cash held

in banks, which is highly liquid and has original maturities of three months or less and is unrestricted as to withdrawal or use.

Restricted Cash

Restricted cash represents the cash restricted

for two standby letters of credit with Eastwest Bank as collateral for certain of the Company’s lease agreements.

The terms of the

letters of credit start from August 1, 2023 and November 7, 2023, respectively.

The letters of credit are renewable on an annual basis

until the termination thereof.

Certain risks and concentration

The Company’s

financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash

and restricted cash, receivables, loan receivable and other current assets.

As of March 31, 2024 and June 30, 2023,

substantially all of the Company’s cash and restricted cash were held in financial institutions located in the U.S., which

management considers to be of high credit quality.

During the nine months ended March 31, 2024 and 2023, our five largest

customers accounted for approximately 55.0 % and 65.1 % of our total revenue, respectively.

One supplier accounted for approximately

52 % and 58 % of the total purchases during the nine months ended March 31, 2024 and 2023, respectively, and no other suppliers accounted

for more than 10% of the total purchases over the same period.

As of March 31, 2024 and June 30, 2023, the largest three accounts

receivable balances from customers accounted for 52 % and 41 % of the total balance of accounts receivable, respectively.

The Company’s financial instruments that

potentially subject the Company to significant concentrations of credit risk consist primarily of cash and restricted cash, receivables,

loan receivables and other current assets.

As of September 30, 2024 and June 30, 2024, substantially all of the Company’s cash and

restricted cash were held in EastWest Bank located in the U.S., which management considers to be of high credit quality.

Accounts receivable and other receivables

5 unchanged sentences

other receivables on a loss rate method based on historical information adjusted for current conditions and future estimated economic

The Company’s credit term generally ranged from 3 to 30 days.

If there is an approval from the board of the Company,

the credit term can extend to 180 days.

Property and equipment

18 unchanged sentences

Shorter of lease term or 15 years

Expenditures for maintenance and repairs are expensed

Gains and losses on disposals are the differences between net sales proceeds and carrying amounts of the relevant assets

and are recognized in the consolidated statements of operations and comprehensive income.

for maintenance and repairs are expensed as incurred.

Gains and losses on disposals are the differences between net sales proceeds

and carrying amounts of the relevant assets and are recognized in the unaudited condensed consolidated statements of operations and

comprehensive income (loss).

Long-Lived Assets

Long-lived assets, such as property and equipment,

and definite-lived intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount

of the assets may not be recoverable.

If circumstances require a long-lived asset or asset group to be tested for possible impairment,

the Company compares the undiscounted expected future cash flows to be generated by that asset or asset group to its carrying amount.

If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment charge

is recognized to the extent the carrying amount of the asset or asset group exceeds the fair value.

Fair values of long-lived assets are

determined through various techniques, such as applying probability weighted, expected present value calculations to the estimated future

cash flows using assumptions a market participant would utilize or through the use of a third-party independent appraiser or valuation

No impairment losses of long-lived assets were recorded during the nine months ended March 31, 2024 and 2023.

assets, such as property and equipment, and definite-lived intangible assets, right-of-use assets (operating lease and finance lease)

are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of the assets may not be recoverable.

If circumstances require a long-lived asset or asset group to be tested for possible impairment, the Company compares the undiscounted

expected future cash flows to be generated by that asset or asset group to its carrying amount.

If the carrying amount of the long-lived

asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment charge is recognized to the extent the carrying

amount of the asset or asset group exceeds the fair value.

Fair values of long-lived assets are determined through various techniques,

such as applying probability weighted, expected present value calculations to the estimated future cash flows using assumptions a market

participant would utilize or through the use of a third-party independent appraiser or valuation specialist.

No impairment losses of

long-lived assets were recorded during the three months ended September 30, 2024 and 2023.

Intangible assets consist of software and security

24 unchanged sentences

performance under the contracts with its customers.

The change in contract liabilities is due to the timing of customer deposits for orders,

offset by customer deposits recognized as revenue during the period.

We expect to recognize revenue for any performance obligations within

a twelve-month period and have elected not to provide disclosures regarding remaining performance obligations for contracts with a term

of one year or less.

The Company also provides warehousing services

25 unchanged sentences

agent on behalf of the customers are excluded from revenue.

The Company uses independent contractors and third-party

carriers in the performance of its transportation services.

The Company evaluates who controls the transportation services to determine

whether its performance obligation is to transfer services to the customer or to arrange for services to be provided by another party.

The Company determined it acts as the principal for its transportation services performance obligation since it is in control of establishing

the prices for the specified services, managing all aspects of the shipments process, and assuming the risk of loss for delivery and collection.

Such transportation services revenue is presented on a gross basis in the consolidated statements of comprehensive income.

The Company uses independent contractors and

third-party carriers in the performance of its transportation services.

The Company evaluates who controls the transportation

services to determine whether its performance obligation is to transfer services to the customer or to arrange for services to be

provided by another party.

The Company determined it acts as the principal for its transportation services performance obligation,

since it is in control of establishing the prices for the specified services, managing all aspects of the shipment process, and

assuming the risk of loss for delivery and collection.

Such transportation services revenue is presented on a gross basis in the

unaudited condensed consolidated statements of operations and comprehensive income (loss).

HOLDING CORP.

1 unchanged sentence

Summary of significant accounting policies

Revenue recognition (cont.)

A summary of the Company’s revenue disaggregated

by major service lines are as follows:

by major service lines is as follows:

September 30,

Transportation services

1 unchanged sentence

Other services

Contract liabilities

Contract liabilities represent payments received

from customers in excess of revenue recognized.

The contract liabilities are reported in a net position on a customer-by-customer basis

at the end of each reporting year.

We classify these customer deposits as short-term contract liabilities, as we expect to satisfy these

obligations within our normal operating cycle, which is generally one year.

For the three months ended September 30, 2024 and 2023, the

amounts transferred from contract liabilities at the beginning of the fiscal year to revenue were $ 276,463 and nil , respectively.

Practical Expedients

5 unchanged sentences

as this amount corresponds directly with the value provided to the customer for the Company’s performance completed to date.

The Company also applies the practical expedient

that permits the recognition of employee sales commissions related to transportation services as an expense when incurred, since the amortization

period of such costs is less than one year.

These costs are included in the consolidated statements of comprehensive income.

The Company adopted ASC 842 — Leases

for its fiscal year beginning on July 1, 2021.

There were some insignificant forklift finance leases subject to ASC 842

upon the adoption of the new standard.

Since these forklift finance leases are classified as finance leases under ASC 842 and were

also previously classified as finance leases under the legacy ASC 840, the adoption of the ASC 842 did not result in material

adjustments to these finance leases compared to ASC 840.

Company also applies the practical expedient that permits the recognition of employee sales commissions related to transportation services

as an expense when incurred, since the amortization period of such costs is less than one year.

These costs are included in the unaudited

condensed consolidated statements of operations and comprehensive income (loss).

The Company determines if an arrangement is a

1 unchanged sentence

Leases are classified as either operating leases or finance leases pursuant to ASC 842.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Summary of significant accounting policies

Leases (cont.)

i) Operating leases

Operating leases are recognized as right-of-use

13 unchanged sentences

and administrative expenses, costs of sales and other expenses.

Finance lease ROU assets are included in ROU and

current lease liabilities, and other non-current lease liabilities in the consolidated balance sheets.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Summary of significant accounting policies

Finance lease ROU assets and liabilities are recognized

at the commencement date based on the present value of lease payments over the lease term.

As most of the Company’s leases do not

provide an implicit rate, management uses the incremental borrowing rate based on the information available at the commencement date in

determining the present value of lease payments.

ii) Finance leases

lease ROU assets are included in ROU and current lease liabilities, and other non-current lease liabilities in the unaudited condensed

consolidated balance sheets.

Finance lease ROU assets and liabilities are

recognized at the commencement date based on the present value of lease payments over the lease term.

As most of the Company’s

leases do not provide an implicit rate, management uses the incremental borrowing rate based on the information available at the commencement

date in determining the present value of lease payments.

Management uses the implicit rate when readily determinable.

Finance lease ROU assets

are generally amortized over the lease term and are included in depreciation expenses.

The interest on the finance lease liabilities is

included in interest expense.

Annually, the Company performs an impairment analysis

on ROU assets, and as of March 31, 2024, there was no material impairment to ROU assets.

Finance lease ROU

assets are generally amortized over the lease term and are included in depreciation expenses.

The interest on the finance lease liabilities

is included in interest expense.

The Company has elected the accounting policy

3 unchanged sentences

expenses on a straight-line basis over the lease term.

Expenses for these short-term leases for the nine months ended March 31, 2024

and 2023 were immaterial.

Current income taxes are provided on the basis

of net profit for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for income

tax purposes, in accordance with the regulations of the relevant tax jurisdictions.

income taxes are provided on the basis of net profit or loss for financial reporting purposes, adjusted for income and expense items

which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax

jurisdictions.

Deferred income taxes are recognized for temporary

9 unchanged sentences

of changes in tax rates is recognized in the statement of operations in the period of the enactment of the change.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Summary of significant accounting policies

Taxation (cont.)

The Company considers positive and negative evidence

10 unchanged sentences

within the industry.

The Company recognizes a tax benefit associated

with an uncertain tax position when, in its judgment, it is more likely than not that the position will be sustained upon examination

by a taxing authority.

For a tax position that meets the more-likely-than-not recognition threshold, the Company initially and subsequently

measures the tax benefit as the largest amount that the Company judges to have a greater than 50 % likelihood of being realized upon ultimate

settlement with a taxing authority.

The Company’s liability associated with unrecognized tax benefits is adjusted periodically due

to changing circumstances, such as the progress of tax audits, case law developments and new or emerging legislation.

Such adjustments

are recognized entirely in the period in which they are identified.

The Company’s effective tax rate includes the net impact of

changes in the liability for unrecognized tax benefits and subsequent adjustments as considered appropriate by management.

classifies interest and penalties recognized on the liability for unrecognized tax benefits as income tax expense.

The Company did not

have any unrecognized tax benefits as of March 31, 2024 and June 30, 2023.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Summary of significant accounting policies

Company recognizes a tax benefit associated with an uncertain tax position when, in its judgment, it is more likely than not that the

position will be sustained upon examination by a taxing authority.

For a tax position that meets the more-likely-than-not recognition

threshold, the Company initially and subsequently measures the tax benefit as the largest amount that the Company judges to have a greater

than 50% likelihood of being realized upon ultimate settlement with a taxing authority.

The Company’s liability associated with

unrecognized tax benefits is adjusted periodically due to changing circumstances, such as the progress of tax audits, case law developments

and new or emerging legislation.

Such adjustments are recognized entirely in the period in which they are identified.

The Company’s

effective tax rate includes the net impact of changes in the liability for unrecognized tax benefits and subsequent adjustments as considered

appropriate by management.

The Company classifies interest and penalties recognized on the liability for unrecognized tax benefits as

income tax expense.

The Company did not have any unrecognized tax benefits as of September 30, 2024 and June 30, 2024.

Earnings per share

Basic earnings per share of commons stock is computed

Basic earnings per share of common stock are computed

by dividing net income allocable to common stockholders by the weighted average number of shares of common stock outstanding.

13 unchanged sentences

All the Company’s business activities

for the nine months ended March 31, 2024 and 2023 were conducted in the U.S.

for the three months ended September 30, 2024 and 2023 were conducted in the U.S.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Summary of significant accounting policies

Fair value measurement

12 unchanged sentences

Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

The Company’s financial instruments include

cash and restricted cash, accounts receivable and other receivables, loan receivable, other current assets, due from related parties,

accounts payable and accrued liabilities, income tax payable, due to related parties, and lease liabilities.

The carrying amounts of cash

and restricted cash, accounts receivable and other receivables, loan receivable, other current assets, due from related parties, accounts

payable and accrued liabilities and income tax payable, due to related parties, and short-term lease liabilities approximate their fair

values due to the short-term nature of these instruments.

The carrying value of the Company’s long-term lease liabilities would

not differ significantly from fair value (based on Level 2 inputs) if recalculated based on current interest rates.

The Company’s financial instruments

include cash and restricted cash, accounts receivable and other receivables, loan receivables, long-term loan receivable, other

current assets, accounts payable and accrued liabilities, income tax payable, due to related parties, and lease liabilities.

carrying amounts of cash and restricted cash, accounts receivable and other receivables, loan receivables, other current assets,

accounts payable and accrued liabilities and income tax payable, due to related parties, and short-term lease liabilities

approximate their fair values due to the short-term nature of these instruments.

The carrying value of the Company’s long-term

loan receivables and long-term lease liabilities would not differ significantly from fair value (based on Level 2 inputs) if

recalculated based on current interest rates.

The Company noted no transfers between levels

1 unchanged sentence

The Company did not have any instruments that were measured at fair value on a recurring or non-recurring

basis as of March 31, 2024 and June 30, 2023.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Summary of significant accounting policies

basis as of September 30, 2024 and June 30, 2024.

Costs of sales

8 unchanged sentences

Management does not believe that any recently

issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s condensed

consolidated financial statements.

issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the Company’s unaudited

condensed consolidated financial statements.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Accounts Receivable and Other Receivables,

1 unchanged sentence

consisted of the following:

September 30,

Accounts receivable – third parties

Accounts receivable – related parties

Accounts receivable – a related party

Other receivables – third parties*

Other receivables – related parties*

Other receivables – a related party*

allowance for credit loss

* The balance is comprised primarily of accounts receivable

associated with service arrangements that are not within the scope of ASC 606.

* The balance is comprised primarily of accounts receivable associated with service arrangements that are not within the scope of ASC 606.

The movement of allowance for credit loss for the three months

ended September 30, 2024 and the fiscal year ended June 30, 2024:

September 30,

Balance as of beginning

Additional provision

Ending balance

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Property and Equipment, Net

Property and equipment, net consisted of the following:

September 30,

Furniture and fixtures

6 unchanged sentences

Property and equipment, net

Depreciation expenses are recorded in costs of sales and general and

administrative expenses.

The Company recorded depreciation expenses of US$ 1,313,684 and US$ 788,699 during the nine months ended

March 31, 2024 and 2023, respectively.

Specifically, US$ 1,091,795 and US$ 641,222 of the depreciation expenses were recorded in costs of

sales for the nine months ended March 31, 2024 and 2023, respectively.

Depreciation expenses are recorded in costs of

sales and general and administrative expenses.

The Company recorded depreciation expenses of US$ 578,432 and US$ 388,929 during the three

months ended September 30, 2024 and 2023, respectively.

Specifically, US$ 436,368 and US$ 324,849 of the depreciation expenses were recorded

in costs of sales for the three months ended September 30, 2024 and 2023, respectively.

US$ 142,064 and US$ 64,080 of the depreciation

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Property and Equipment, Net (cont.)

expenses were recorded in general and administrative

expenses for the nine months ended March 31, 2024 and 2023, respectively.

The Company recorded depreciation expenses of US$ 525,167

and US$ 289,689 during the three months ended March 31, 2024 and 2023, respectively.

Specifically, US$ 436,084 and US$ 235,478 of the depreciation

expenses was recorded in costs of sales for the three months ended March 31, 2024 and 2023, respectively.

US$ 89,083 and US$ 54,211 of the

depreciation expenses were recorded in general and administrative expenses for the three months ended March 31, 2024 and 2023, respectively.

expenses were recorded in general and administrative expenses for the three months ended September 30, 2024 and 2023, respectively.

Intangible Assets, Net

Intangible assets, net consisted of the following:

September 30,

Security Systems

Accumulated depreciation

Intangible, net

The Company recorded amortization of US$ 26,488

and US$ 22,088 , which were included in costs of sales, for the nine months ended March 31, 2024 and 2023, respectively.

Intangible assets, net

The Company recorded amortization of US$ 8,829

and US$ 8,229 , which were included in costs of sales, for the three months ended March 31, 2024 and 2023, respectively.

and US$ 8,829 , which were included in costs of sales, for the three months ended September 30, 2024 and 2023, respectively.

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Loan Receivable

The Company’s loan receivable is consisted

The Company’s loan receivables were consisted

of the following:

i) On February 8, 2023, the Company entered into a loan

agreement with Pundarika LLC for a principal of US$ 500,000 .

The loan matures on February 15, 2024 and bears interest at a rate of

3.2 % annually.

i) On February 8, 2023, the Company entered into a loan agreement with Pundarika LLC for a principal of US$ 500,000 .

The loan matured on February 15, 2024 and bore interest at an annual rate of 3.2 %.

The loan was fully paid on May 29, 2024.

ii) On February 27, 2023, the Company entered into a loan

agreement with Pundarika LLC for a principal of US$ 1,000,000 .

The loan matures on March 25, 2024 and bears interest at a rate of

3.2 % annually.

ii) On February 27, 2023, the Company entered into a loan agreement with Pundarika LLC for a principal of US$ 1,000,000 .

The loan matured on March 25, 2024 and bore interest at an annual rate of 3.2 %.

The loan was fully paid on May 29, 2024.

March 24, 2023, the Company entered into a loan agreement with Pundarika LLC for a principal of US$ 925,000 .

The loan matures on

April 30, 2024 and bears interest at a rate of 3.2 % annually.

The loan was fully paid on June 6, 2024.

iv) On July 10, 2023, the Company entered into a loan agreement

with Pundarika LLC for a principal of US$ 1,000,000 .

The loan matures on August 31, 2024 and bears interest at a rate of 3.2 % annually.

v) On January 24, 2024, the Company entered into a loan agreement

with Paul Tam for a principal of US$ 150,000 .

iii) On March 24, 2023, the Company entered into a loan agreement with

Pundarika LLC for a principal of US$ 925,000 .

The loan matured on April 30, 2024 and bore interest at an annual rate of 3.2 %.

loan was fully paid on June 6, 2024.

iv) On July 10, 2023, the Company entered into a loan agreement with

Pundarika LLC for a principal of US$ 1,000,000 .

The loan matured on August 31, 2024 and bore interest at a rate of 3.2 % annually.

The loan was fully paid on August 30, 2024

v) On January 24, 2024, the Company entered into a loan agreement with

Paul Tam for a principal of US$ 150,000 .

The loan matures on January 24, 2025 and bears interest at a rate of 3.2 % annually.

loan has been fully paid on February 13, 2024.

vi) On January 24, 2024, the Company entered into a loan agreement

with Athena Home Inc.

fully paid on February 13, 2024.

vi) On January 24, 2024, the Company entered into a loan agreement with

Athena Home Inc.

for a principal of US$ 600,000 .

The loan matures on January 24, 2025 and bears interest at a rate of 3.2 % annually.

As of March 31, 2024, the Company recorded a loan

receivable balance of US$ 4,135,179 , including accrued interest income of US$ 110,179 .

Company expects to repay the loan upon maturity.

vii) On May 22, 2024, the Company entered into a loan agreement with MYJW LLC.

for a principal of US$ 400,000 .

The loan matures on December 31, 2025 and bears interest at a rate of 3.2 % annually.

The Company expects to repay the loan upon maturity.

viii) On May 28, 2024, the Company entered into a loan agreement with Pundarika LLC.

for a principal of US$ 1.5 million.

The loan matures on December 31, 2025 and bears interest at a rate of 3.2 % annually.

The Company expects to repay the loan upon maturity.

ix) On June 6, 2024, the Company entered into a loan agreement with Pundarika LLC.

for a principal of US$ 1.0 million.

The loan matures on December 31, 2025 and bears interest at a rate of 3.2 % annually.

The Company expects to repay the loan upon maturity.

x) On June 13, 2024, the Company entered into a loan agreement with Bacalar Enterprise Freight Inc.

for a principal of US$ 250,000 .

The loan matures on June 13, 2025 and bears interest at a rate of 3.2 % annually.

The Company expects to repay the loan upon maturity.

xi) On August 29, 2024, the Company entered into a loan agreement with Pundarika LLC.

for a principal of US$ 1.0 million.

The loan matures on December 31, 2025 and bears interest at a rate of 3.2 % annually.

The Company expects to repay the loan upon maturity.

As of September 30, 2024, the Company recorded

a loan receivable balance of US$ 861,554 and long-term loan receivable of US$ 3,921,243 , including accrued interest income of US$ 32,797 .

As of June 30, 2024, the Company recorded a loan

receivable balance of US$ 1,877,131 and long-term loan receivable of US$ 2,908,636 , including accrued interest income of US$ 35,767 .

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

As of March 31, 2024, the Company had operating

and finance leases for office space, warehouse space, and forklifts.

Lease terms expire at various dates through April 2026 to November

2034 with options to renew for varying terms at the Company’s sole discretion.

The Company has not included these options to extend

or terminate in the calculation of right-of-use assets or lease liabilities, as there is no reasonable certainty, as of the date of this

report, that these options will be exercised.

The Company has certain sublease contracts and recognized US$ 2,133,436 and US$ 198,000 lease

income during the nine months ended March 31, 2024 and 2023, respectively.

During the three months ended March 31, 2024 and 2023, the

Company recognized US$ 970,898 and US$ 69,000 lease income, respectively.

As of March 31, 2024, the Company recognized additional

operating lease liabilities of US$ 73,306,806 , compared to the balance of US$ 49,852,679 as of June 30, 2023, as the result of entering

into three new operating lease agreements.

The ROU assets were recognized at the discount rate range from 10.50 % to 10.75 %, resulting

in US$ 81,927,507 on the commencement dates.

As of March 31, 2024, maturities of lease liabilities

for each of the following fiscal years ending June 30 and thereafter were as follows:

As of September 30, 2024, the Company had operating and finance leases

for office space, warehouse space, and forklifts.

Lease terms expire at various dates from February 2025 through July 2034 with options

to renew for varying terms at the Company’s sole discretion.

The Company has not included these options to extend or terminate in

the calculation of ROU assets or lease liabilities, as there is no reasonable certainty, as of the date of this Quarterly Report, that

these options will be exercised.

The Company had certain sublease contracts and recognized US$ 727,498 and US$ 239,478 lease income, recorded

in other income, during the three months ended September 30, 2024 and 2023, respectively.

As of September 30, 2024, the Company does not

recognize any additional operating lease liabilities.

The components of lease expenses were as follows:

September 30,

Operating lease expenses

Amortization – included in costs of sales

The Company recorded operating lease expenses

of US$ 8,111,425 and US$ 5,218,558 during the three months ended September 30, 2024 and 2023, respectively.

Specifically, US$ 7,621,771 and

US$ 5,119,738 of operating lease expenses were recorded in costs of sales for the three months ended September 30, 2024 and 2023, respectively.

US$ 93,000 and US$ 98,820 of operating lease expenses were recorded in general and administrative expenses for the three months ended September

30, 2024 and 2023, respectively.

US$ 396,654 and nil of operating lease expenses were recorded in other expenses for the three months ended

September 30, 2024 and 2023, respectively.

As of September 30, 2024, maturities of lease

liabilities for each of the following fiscal years ending June 30 and thereafter were as follows:

2029 and beyond

8 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Accounts Payable

and Accrued Liabilities

Leases (cont.)

Weighted average remaining lease term:

Operating leases 5.06 years

Finance leases 2.11 years

Weighted average discount rate:

Operating leases

Finance leases

Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities consisted

of the following:

September 30,

Accounts payable

1 unchanged sentence

Other liabilities

Other liabilities as of March 31, 2024 mainly

consisted of tenant’s deposit.

Other liabilities as of September 30, 2024 and

June 30, 2024 mainly consisted of tenant’s deposit.

Other Income (Expenses)

Other income and expenses consisted of the following:

September 30,

Rental income

Rental expense

Interest income

Credit card rebate income

HOLDING CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Stockholders’ Equity

The Company is authorized to issue 100,000,000

shares of common stock, par value US$ 0.00001 per share, and 40,000,000 shares were issued and outstanding as of March 31, 2024 and June

shares of common stock, par value US$ 0.00001 per share, 41,634,000 shares were issued and outstanding as of September 30, 2024 and June

30, 2024, respectively.

No additional shares were issued during the nine months ended March 31, 2024 and 2023.

During the nine months ended March 31, 2024,

the Company’s stockholders made a total of US$ 766,156 (2023:

US$ 350,000 ) of capital contributions to the Company.

On May 15, 2024, the Company closed its initial

public offering (the “IPO”) of 1,600,000 shares of common stock, par value of US$ 0.00001 per share, for a price of US$ 5.00

per share for aggregate gross proceeds of $ 8 million from the offering.

The total net proceeds to the Company from the IPO, less certain

underwriting discounts and expenses, were approximately $ 5.2 million.

In connection with the IPO, the Company entered into an underwriting

agreement (the “Underwriting Agreement”) with EF Hutton LLC, and granted a 45 -day option to purchase up to 240,000 additional

shares of common stock from the Company at the offering price of US$ 5.00 per share.

As of June 30, 2024, the underwriter had exercised

the option to purchase 34,000 additional shares of common stock from the Company.

The remaining options have expired as of the date of

this Quarterly Report.

On May 15, 2024, the Company issued to the Representative

and its affiliates warrants, exercisable during the five-year period from the commencement of sales of this offering, entitling the Representative

to purchase an aggregate of up to 80,000 shares of common stock at a per share price equal to 125.0 % of the public offering price per

share in the IPO, or US$ 6.25 (the “Representative’s Warrants”).

The fair value of US$ 268,430 of the Representative’s

Warrants, using the Black Scholes Model with the following weighted-average assumptions:

market value of underlying share of $ 4.62 , risk

free rate of 4.46 %, expected term of five years ;

exercise price of the warrants of $ 6.25 , volatility of 100 %;

and expected future dividends

of nil , was recorded in the Additional Paid-in Capital.

Earnings per Share

Basic and diluted net earnings per share for the

nine months ended March 31, 2024 and 2023 were as follows:

Net income attributable to stockholders – basic and diluted

Weighted average number of shares of common stock outstanding – basic and diluted

Earnings per share attributable to stockholders – basic and diluted

three months ended September 30, 2024 and 2023 were as follows:

September 30,

Net income (loss) attributable to stockholders – basic and diluted

( 4,647,871 )

Weighted average number of shares of common stock outstanding – basic

Earnings per share attributable to stockholders – basic

Weighted average number of shares of common stock outstanding – diluted

Earnings per share attributable to stockholders – diluted

Basic earnings per share is computed using the

6 unchanged sentences

Other commitments

Other than the standby letter of credit (note

2) and the operating and finance leases (note 7), the Company did not have other significant commitments, long-term obligations, or guarantees

as of March 31, 2024 and June 30, 2023.

Other than the standby letters of credit with

Eastwest Bank in the aggregate amount of $ 2,061,673 (see Note 2) and the operating and finance leases (See Note 7), the Company did not

have other significant commitments, long-term obligations, or guarantees as of September 30, 2024 and June 30, 2024.

Contingencies

4 unchanged sentences

financial position, cash flows or results of operations taken as a whole.

As of March 31, 2024, the Company was not a party to any material

legal or administrative proceedings.

As of September 30, 2024 and 2023, the Company was not a party

to any material legal or administrative proceedings.

Related Party Transactions and Balances

10 unchanged sentences

The Company had the following related party transactions:

(i) During the nine months ended March 31, 2024, the Company’s

related parties, Jacky Chen, Aidy Chou and Tong Wu advanced an aggregate of US$ 1,000 to support the Company’s working capital needs.

(ii) During the nine months ended March 31, 2024, Junchu Inc.,

a company wholly owned by Tong Wu, repaid the loan with a principal of US$ 500,000 and interest expense of US$ 11,353 .

(iii) DNA Motor Inc., the landlord of five of the Company’s

operating leases is owned by Jacky Chen.

During the nine months ended March 31, 2024, for these operating leases, US$ 302,537 (2023:

US$ 1,361,857 ) lease expense was recorded in general administrative expenses and US$ 8,724,422 (2023:

US$ 8,772,503 ) was recorded in costs

of sales and US$ 829,563 (2023:

(i) During the three months ended September 30, 2024, the Company’s related parties, Jacky Chen, Aidy Chou and Tong Wu, together advanced $ nil (2023:

US$ 491,978 ) to support the Company’s working capital needs.

(ii) DNA Motor Inc.

(“DNA”), the landlord of five of the Company’s operating leases, is owned by Jacky Chen.

During the three months ended September 30, 2024, for these operating leases, US$ 94,829 (2023:

US$ 116,988 ) lease expense was recorded in general and administrative expenses, US$ 2,989,368 (2023:

US$ 3,180,657 ) was recorded in costs of sales and US$ 408,098 (2023:

nil ) was recorded in other expenses.

The aggregate lease liability associated with these operating leases

as of March 31, 2024 was US$ 34,714,898 .

(iii) During the nine months ended March 31, 2024, the Company

generated revenue of US$ 1,362,898 for providing logistic services to DNA Motor Inc.

(iv) During the nine months ended March 31, 2024, the Company incurred

operating expenses that totaled US$ 52,000 for outside services provided by DNA Motor Inc.

(v) On January 22, 2024, the Company entered into a loan agreement

with Tony Wu for a principal of US$ 700,000 .

The loan matures on January 24, 2025 and bears interest at a rate of 3.2 % annually.

6, 2024, the loan was repaid with the principal and interest expense of US$ 2,700 .

The aggregate lease liability associated with these operating leases as of September 30, 2024 and June 30, 2024 was US$ 31,063,361 and US$ 32,853,612 , respectively.

(iii) During the three months ended September 30, 2024, the Company generated revenue of US$ 553 (2023:

US$ 140,959 ) for providing logistic services to DNA.

During the three months ended September 30, 2024, the Company generated revenue of US$ 884,700 (2023:

US$ 125,813 ) for providing warehouse services to DNA.

During the three months ended September 30, 2024, the Company paid expenses in the total amount of US$ 716,789 on behalf of DNA.

The amount due from DNA is included in accounts receivable and other receivables from a related party as disclosed in Note 3.

HOLDING CORP.

1 unchanged sentence

Related Party Transactions and Balances

Due from related party balance

The Company’s balances due from related

parties as of March 31, 2024 and June 30, 2023 were as follows:

The due from related party balances as of June 30,

2023 are unsecured, bear interest at a rate of 3.2 %, and are due on demand.

Related Party transactions (cont.)

the three months ended September 30, 2024, the Company incurred general and administrative expenses of US$ 607 for outside services, warehouse

supplies, freight expenses and operating expenses provided by DNA.

During the three months ended September 30, 2023, the Company

incurred operating expenses that totaled US$ 15,000 for outside service provided by DNA.

Due to related party balance

The Company’s balances due to related parties

as of March 31, 2024 and June 30, 2023 were as follows:

The due to related party balances as of March

as of September 30, 2024 and June 30, 2024 were as follows:

September 30,

The due to related party balances as of September

30, 2024 and June 2024 are unsecured, interest-free, and are due on demand.

Subsequent Events

On May 13, 2024, the Company entered into an underwriting

agreement (the “Underwriting Agreement”) with EF Hutton LLC, as representative of the several underwriters listed on Schedule

A to the Underwriting Agreement (the “Representative”), relating to the Company’s initial public offering (the “IPO”)

of 1,600,000 shares of common stock, par value US$ 0.00001 per share, for a price of US$ 5.00 per share, less certain underwriting discounts.

The Company also granted the underwriters a 45-day option to purchase up to 240,000 additional shares of common stock on the same terms

and conditions for the purpose of covering any over-allotments in connection with the IPO.

On May 15, 2024, the Company closed the IPO.

Company completed the IPO pursuant to its registration statement on Form S-1 (File No.

333-274667), which was initially filed with the

SEC on September 25, 2023, as amended, and declared effective by the SEC on May 13, 2024.

The offering was conducted on a firm commitment

The Company’s shares of common stock were previously approved for listing on the Nasdaq Global Market and commenced trading

under the ticker symbol “BTOC” on May 14, 2024.

On May 15, 2024, the Company issued to the Representative and its affiliates

warrants, exercisable during the five-year period from the commencement of sales of the offering, entitling the Representative to purchase

an aggregate of up to 80,000 shares of common stock at a per share price equal to 125.0 % of the public offering price per share in the

IPO, or US$ 6.25 .

Company has evaluated the impact of events that have occurred subsequent to September 30, 2024, through the date the consolidated financial

statements were available to issue, and concluded that no subsequent events have occurred that would require recognition in the consolidated

financial statements or disclosure in the notes to the unaudited interim condensed consolidated financial statements.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements