What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-04-19 compared with 2022-01-18 · 209 added, 109 removed, 4 unchanged (99% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

LOOKING STATEMENTS

made in this Form 10-Q that are not historical or current facts are “forward-looking statements” made pursuant to the safe

harbor provisions of Section 27A of the Securities Act of 1933 (the “Act”) and Section 21E of the Securities Exchange Act

These statements often can be identified by the use of terms such as “may,” “will,” “expect,”

“believe,” “anticipate,” “estimate,” “approximate” or “continue,” or the

negative thereof.

We intend that such forward-looking statements be subject to the safe harbors for such statements.

We wish to caution

readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made.

Any forward-looking

statements represent management’s best judgment as to what may occur in the future.

However, forward-looking statements are subject

to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from

historical results of operations and events and those presently anticipated or projected.

We disclaim any obligation subsequently to

revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence

of anticipated or unanticipated events.

Unex Holdings Inc.

was incorporated in the State of Nevada on February 17, 2017 and established the fiscal year end of August 31.

We have no revenues, have

minimal assets and have incurred losses since inception.

We were formed to provide geodesy services, and we are still in the development

Upon completion of the Transactions (defined in Note 7), the Company will be principally involved in the sale of HVAC

Our business office is located at 31-A2, Jalan 5/23A, 6 ½ Miles off Jalan Kepong, 52000 Kuala Lumpur, Malaysia.

Our telephone number is +603 6243 3379.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

FORWARD-LOOKING

quarterly report contains forward-looking statements relating to future events or our future financial performance.

In some cases, you

can identify forward-looking statements by terminology such as “may”, “should”, “intends”, “expects”,

“plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential”,

or “continue” or the negative of these terms or other comparable terminology.

These statements are only predictions and involve

known and unknown risks, uncertainties and other factors which may cause our or our industry’s actual results, levels of activity

or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking

we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels

of activity or performance.

You should not place undue reliance on these statements, which speak only as of the date that they were made.

These cautionary statements should be considered with any written or oral forward-looking statements that we may issue in the future.

Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking

statements to conform these statements to actual results, later events or circumstances or to reflect the occurrence of unanticipated

this report unless otherwise specified, all dollar amounts are expressed in United States dollars and all references to “common

shares” refer to the common shares of our capital stock.

management’s discussion and analysis of our financial condition and results of operations are based upon our financial statements,

which have been prepared in accordance with U.S.

was incorporated in the State of Nevada on February 17, 2017 and was formed to provide geodesy services.

On December 20, 2021, EvoAir

International transferred its HVAC business to Unex, the Company through its subsidiaries upon completion of the Transactions (defined

hereunder), is engaged in the sale of (“HVAC”) products in Asia.

International is a company incorporated in the BVI on November 17, 2021 and the parent company of WKL Eco Earth Holdings, WKL Eco Earth,

WKL Green Energy, EvoAir Manufacturing, WKL EcoEarth Indochina, WKL Guanzhe and Evo Air Marketing (M) Sdn.

(“Evo Air Marketing”)

(together with Unex, EvoAir International, to be referred to as the “WKL Group” or “the Group”).

The WKL Group

is principally engaged in the research and development, manufacturing sale and marketing of HVAC products for residential, commercial

and industrial uses.

WKL Group operates manufacturing plants and assembly lines in China and Malaysia in order to develop and manufacture its HVAC products,

totaling approximately 60,000 square feet of manufacturing space.

With the rise of the Covid-19 pandemic, the Group has been engaged

as an authorized exclusive distributor of the INCU branded Ionic Nano Copper Solution Technology (“INCU Technology”).

Group partners with various original equipment manufacturers (“OEMs”) in producing air purifier products that incorporate

the INCU Technology under the brand e-Cond Life , as well as distributes the INCU Technology to other brands for incorporation

into their products.

of Operations

financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments

relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable

to continue in operation.

expect we will require additional capital to meet our long-term operating requirements.

We expect to raise additional capital through,

among other things, the issuance of equity or debt securities.

Our total assets were zero as of November 30,2021

and August 31, 2021 respectively.

The accrued expenses reported at $12,000 and $9,500 as of November 30, 2021 and August 31,2021

respectively.

The accrued expenses mainly were independent auditor fees for financial year ended August 31,

2021 and financial period ended November 30, 2021.

As of November 30, 2021 and August 31,2021 amounts

due to a related party amounting $45,134 and $44,134 were advances from a company related to the Company’s majority

stockholder, officer and director, Dr.

Low to pay for operating expenses.

Those expenses were professional fee, filling fee

and audit fee.

Stockholders’

deficit stood at $57,134 as of November 30, 2021, compared to $53,634 as of August 31, 2021.

months ended November 30, 2021 compared to three months November, 2020.

Company did not generate revenue for the three months ended November 30, 2021 and three months ended November 30, 2020.

Company registered net loss of $3,500 for the three months ended November 30, 2021 compared to $5,773 for the three months

ended November 30, 2020.

Flows used by Operating Activities

cash flows used in operating activities for the

three months ended November 30, 2021 and 2020 were zero and $5,927 respectively.

Flows used by Investing and Financing Activities

were no investing and financing activities during three months ended November 30, 2021 and 2020

OF OPERATION AND FUNDING

With the injection of a the New Business contemplated

under the Transaction (defined in Note 7), the New Management will implement the business plans for the HVAC business including expansion

in product offerings, geographical expansion, generate revenue through expansion of revenue streams and customer base (retail, commercial

and industrial as well as private label and licensing clientele), improvement of profitability by achieving economies of scale provide

the opportunity for the Company to continue as a going concern.

expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances

of securities.

Our working capital requirements are expected to increase in line with the growth of our business.

working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations

over the next twelve months.

We have no lines of credit or other bank financing arrangements.

Generally, we have financed operations

to date through the proceeds of the private placement of equity and debt instruments.

In connection with our business plan, management

anticipates additional increases in operating expenses and capital expenditures relating to:

(i) working capital;

(ii) research

and development expenditure for new invention and improvement of existing product range;

and (iii) marketing expenses;

We intend to finance these expenses with existing funding, internally generated funds, issuances of equity and

debt securities.

Additional issuances of equity or convertible debt securities will result in dilution to our current stockholders.

Further, such securities might have rights, preferences or privileges senior to our common stock.

Additional financing may not be

available upon acceptable terms, or at all.

If adequate funds are not available or are not available on acceptable terms, we may not

be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our

business operations.

following summary of our operations should be read in conjunction with our unaudited condensed consolidated financial statements

for the three and six months ended February 28, 2022, as compared to the three and six months ended February 28, 2021.

months Quarter Ended February 28, 2022, versus Three months Quarter Ended February 28, 2021

Cost of revenue

profit / (loss)

from operation

income/ (expense) income

Company generated revenues of $302,884 in the three months ended February 28,2022 as compared to $27,568 in the same financial period

for 2021, a change in revenue of $275,316.

The sales increases in the 2022 are attributable to the expansion of customer base, increase

sales to existing customers as well as expansion of product offering.

of revenue was $194,585 or 64% of revenue in the three months ended February 28 as compared to $67,730 or 246% of revenue in the same

financial period for 2021.

Cost of revenues includes production cost and purchases of goods.

profit was $108,299 or 36% of revenue for the three months ended February 28 ,2022 as compared to gross loss of $40,162 in the same financial

period in 2021 or 146% of revenues.

The improvement in gross profit in the corresponding period in 2022 is attributable to the economies

of scale resulting in higher level of sales

Operating expenses were $1,303,079 for the three months ended February 28, 2022 compared to $558,986 in the corresponding period in 2021,

an increase of $744,093.

The increase of operating expenses were in line with the growth in business operations and business development,

professionals fee and compliance cost in relation to our financial reporting, patent and trademark filings.

net loss from operations for the three months ended February 28,2022 was $2,188,398 as compared to $598,526 for the corresponding period

The continuous operating loss is attributable to the Group’s focused effort in creating the infrastructure and resource

to meet the business expansion needs of the Group’s as well as lack of economies of scale.

Months Ended February 28, 2022, versus Six

months Ended February 28, 2021

Six Months Ended

Cost of revenue

Operating expenses

Loss from operation

Other income /(expense)

$ (2,571,730 )

Company generated revenue of $1,111,763 for the six months ended February 28, 2022 as compared to $221,231 in the corresponding financial

period in 2021, an increase in revenues of $890,532 which is attributable to the expansion of customers base, increase of sales from

existing customers and expansion of product offerings as well as increased sales to existing customers.

of revenues was $901,999 or 81% of revenues in the six months ended February 28, 2022 as compared to $117,226 or 53% of revenue in the

corresponding period in 2021.

Cost of revenues includes production cost and purchases of goods.

profit was $209,764 or 19% of revenue for the six months ended February 28, 2022 as compared to $104,005 in the corresponding period

in 2021 or 47% of revenues.

The improvement of gross income in the corresponding period in 2022 is attributable to the increase in sales

of higher margin products and economy of scale resulting from higher level of sales.

expenses were $1,813,136 for the six months ended February 28, 2022 compared to $739,376 in the corresponding period in 2021, an increase

of $1,073,760.

An increased operating expense was in line with the growth in business operations and business development, professionals

fee and compliance cost in relation to our financial reporting, patent and trademark filings.

net loss from operations for the six month first half of fiscal 2022 was $1,603,372 as compared to $635,371for the comparable period

of the prior year.

The continuous operating loss is attributable to the infrastructure and resource to meet the business expansion needs

of the Group’s as well as lack of economies of scale.

and Capital Resources

Current Assets

Current Liabilities

Working Capital

at February 28, 2022, our company’s liabilities stood at $1,279,058, which included account payable and accruals of $17,694, other

payable of $655,946, hire purchase creditor $34,372, amount due to related party $22,204 and current portion operating lease liabilities

of $49,070, and the non-current portion operating lease liabilities of $499,772.

at February 28, 2022 our company had a positive working capital of $1,886,958 compared with the positive working capital of $1,558,893

as at August 31, 2021.

The increase in working capital was primarily due to a decrease in convertible bonds balance at current period

Cash flows (used in)/ generated from operating activities

Cash flows used in investing activities

Cash flows provided by financing activities

Net changes in cash

Company’s cash and cash equivalents stood at $508,490 as of February 28, 2022.

Cash used in operating activities for the six months

ended February 28, 2022, was $881,506.

This resulted from primarily from a net loss of $2,571,730 which was offset by depreciation of

$18,375, operating lease $23,460, increase in inventories of $335,183, decrease in account receivable of $96,277 and $116,416 decrease

in other receivables, decrease in account payable and accruals of $520,255, increase in other payable of $622,868 and decrease in amount

due to related party of $30,277.

used in investing activities resulted from purchase of fixed assets amounting to $524,148 for the six months ended February

Company’s business is not subject to seasonality.

Sheet Arrangements.

of the date of this Quarterly Report, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a

current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity,

capital expenditures or capital resources that are material to investors.

Company’s financial statements as of November 30, 2021, is prepared using generally accepted accounting principles in the United

States of America applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal

Company has no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on its financial

condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Accounting Policies

revenue recognition policy is in compliance with ASC 606, Revenue from Contracts with Customers that revenue is recognized when

a customer obtains control of promised goods and is recognized in an amount that reflects the consideration that we expect to receive

in exchange for those goods.

In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue

and cash flows arising from contracts with customers.

The amount of revenue that is recorded reflects the consideration that we expect

to receive in exchange for those goods.

We apply the following five-step model in order to determine this amount:

identification

of the promised goods and services in the contract;

determination

of whether the promised goods and services are performance obligations, including whether they are distinct in the context of the

of the transaction price, including the constraint on variable consideration;

of the transaction price to the performance obligations;

of revenue when (or as) the Company satisfies each performance obligation.

only apply the five-step model to contracts when it is probable that we will collect the consideration it is entitled to in exchange

for the goods or services it transfers to the customer.

Once a contract is determined to be within the scope of ASC 606 at contract inception,

we review the contract to determine which performance obligations we must deliver and which of these performance obligations are distinct.

We recognize as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance

obligation is satisfied or as it is satisfied.

Generally, our performance obligations are transferred to customers at a point in time,

typically upon delivery for local sales and upon shipment of the products for export sale.

all reporting periods, we have not disclosed the value of unsatisfied performance obligations for all product revenue contracts with

an original expected length of one year or less, which is an optional exemption that is permitted under the adopted rules.

and Assumptions

preparing our condensed consolidated financial statements, we use estimates and assumptions that affect the reported amounts and

Our estimates are often based on complex judgments, probabilities and assumptions that we believe to be reasonable, but

that are inherently uncertain and unpredictable.

We are also subject to other risks and uncertainties that may cause actual results to

differ from estimated amounts.

Significant estimates in 2022 and 2021 include the assumptions used to value tax liabilities, derivative

financial instruments, the estimates of the allowance for deferred tax assets, and the accounts receivable allowance, and impairment

of long-lived assets and inventory write-offs.

to the COVID-19 pandemic, there has been uncertainty and disruption in the global economy and financial markets which could impact our

estimates and assumptions.

We have assessed the impact and are not aware of any specific events or circumstances that required an update

to our estimates and assumptions or materially affected the carrying value of our assets or liabilities as of the date of issuance of

this Quarterly Report on Form 10-Q.

These estimates may change as new events occur and additional information is obtained.

Actual results

could differ materially from these estimates under different assumptions or conditions.

of February 28, 2022 and August 31, 2021, the accumulated deficit stood at $4,613,553 and $2,233,496 respectively, which included a net

loss of $2,571,730 and $633,918 for six months ended February 28, 2022 and February 28, 2021, respectively.

The cash used in operating

activities for the six months ended February 28, 2022, was $881,506.

It was brought to the attention of the Management to assess going

concern considering all facts and circumstances about the foreseeable future of the Company as well as its assets and liabilities on

the basis that it will be able to realize and discharge them in the normal course of business.

was brought to the attention of the Management to assess going concern considering all facts and circumstances about the foreseeable

future of the Company as well as its assets and liabilities on the basis that it will be able to realize and discharge them in the normal

course of business.

The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow

it to continue as a going concern.

The Company incurred net loss of $3,500 and $5,773 for three months ended November 30, 2021

and 2020, respectively.

As of November 30, 2021 and August 31, 2021, the company recorded net current liability and deficit on

total equity of 57,134 and $53,634, respectively and stockholders’ deficit of $57,134 and $53,634, respectively These

conditions raise substantial doubt about the Company’s ability to continue as a going concern.

the injection of the New Business contemplated under the Transaction (defined in Note 7), the Management believes that the actions to

be taken by the new Management to further implement the business plans for the New Business including expansion in product offerings,

geographical expansion, generate revenue through expansion of revenue streams and customer base (retail, commercial and industrial as

well as private label and licensing clientele), improvement of profitability by achieving economies of scale provide the opportunity

for the Company to continue as a going concern.

In addition, the Company is also working on raising additional funding to finance the

operations as well as business expansion.

ability to continue as a going concern is dependent upon our capability to further implement our business plan and generate revenues.

These financial statements do not include any adjustments

related to the recoverability and classification of assets or the amounts and classification of liabilities that might be necessary should

the Company be unable to continue as a going concern.

the injection of a viable business into the Company (“New Business”) contemplated under the Transactions (defined in Note

1), the Management believes that the actions to be taken by the Management to further implement the business plans for the New Business

including expansion in product offerings, geographical expansion, generate revenue through expansion of revenue streams and customer

base (retail, commercial and industrial as well as private label and licensing clientele), improvement of profitability by achieving

economies of scale provide the opportunity for the Company to continue as a going concern.

In addition, the Company is also working on

raising additional funding to finance the operations as well as business expansion.

consolidated financials have been prepared assuming that the Company will continue as a going concern and, accordingly financial statements

do not include any adjustments related to the recoverability and classification of assets or the amounts and classification of liabilities

that might be necessary should the Company be unable to continue as a going concern.

March 22, 2021, the Group entered into a tenancy agreement to lease the premise at No 31-2A, Jalan 5/32A, 6 ½ Miles, Off Jalan

Kepong, 52000 Kuala Lumpur, Malaysia for 2 years from 1 May 2021 to 30 April 2023.

The lease may be terminated by either party with 3

month notice.

Monthly rental is RM 23,000.

This tenancy agreement has a renewal option of 2 years plus2 years with the agreed month rental

of RM25,000 for the first term of two (2) years, and RM27,000 for the second term of two (2) years.

February 5, 2021, the Group entered into a lease agreement to lease a factory at 3rd Floor, No.

1, Depin Road, Xingtan Town, Shunde District,

Foshan City for a 5 year period from April 1, 2021 to April 30, 2026 for a monthly rental of RMB54,578.

December 22, 2020, the Group entered into a lease agreement to lease the premise at No 65 Floor 1, 2 & 3, Street 123, Phum 4, Sangkat

Toul Tumpong I, Khan Chamkarman, Phnom Penh at a monthly of $4,500 from December 1, 2020 to November 30, 2022.

the monthly rental will

be increased to $6,000 per month from December 1, 2022 to November 30, 2024.

Sheet Arrangements

of the date of this Quarterly Report, we do not have any off-balance sheet arrangements that have or are reasonably likely

to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations,

liquidity, capital expenditures or capital resources that are material to investors.

Accounting Pronouncements

for rules and interpretive releases of the SEC under the authority of federal securities laws and a limited number of grandfathered standards,

the FASB Accounting Standards Codification™ (“ASC”) is the sole source of authoritative US GAAP literature recognized

by the FASB and applicable to the Company.

Management has reviewed the aforementioned rules and releases and believes any effect will

not have a material impact on the Company’s present or future financial statements.

December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), which enhances and simplifies various aspects of the income tax

accounting guidance, including requirements such as tax basis step-up in goodwill obtained in a transaction that is not a business combination,

ownership changes in investments, and interim-period accounting for enacted changes in tax law.

The amendment will be effective for public

companies with fiscal years beginning after December 15, 2020;

early adoption is permitted.

There is no material impact on the Company’s

financial statements.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

a “smaller reporting company” as defined by Item 10 of Regulation S-K, the Company is not required to provide information

required by this Item.

a “smaller reporting company”, we are not required to provide the information required by this Item.

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 2. Management’s Discussion and Analysis