Item
2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Forward
Looking Statement Notice
Certain
statements made in this Quarterly Report on Form 10-Q are “forward-looking statements” (within the meaning of the
Private Securities Litigation Reform Act of 1995) regarding the plans and objectives of management for future operations. Such statements
involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of Goliath
Film and Media Holdings, (“we”, “us”, “our” or the “Company”)
to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.
The forward-looking statements included herein are based on current expectations that involve numerous risks and uncertainties. The Company’s
plans and objectives are based, in part, on assumptions involving the continued expansion of business. Assumptions relating to the foregoing
involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions,
all of which are difficult or impossible to predict accurately and many of which are beyond the control of the Company. Although the
Company believes its assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate
and, therefore, there can be no assurance the forward-looking statements included in this Quarterly Report will prove to be accurate.
In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information
should not be regarded as a representation by the Company or any other person that the objectives and plans of the Company will be achieved.
Description
of Business
Background.
The
Company was incorporated in Nevada on February 16, 2010 under the name “China Advanced Technology” as the successor by merger
to Vitalcare Diabetes Treatment Centers, Inc. (“Vitalcare”). In February and March 2010, Vitalcare underwent a holding company
reorganization under Delaware law, pursuant to which it became a wholly-owned subsidiary of Vitalcare Holding Corporation, and Vitalcare,
together with its assets and liabilities, was sold to a non-affiliated third party. Vitalcare Holding Corporation subsequently reincorporated
in Nevada by merger into China Advanced.
Vitalcare
was in the business of administering medical clinics specializing in diabetes treatment. It was the successor to Network Financial Services,
Inc. (“Network”), which went public in an underwritten offering in 1987. Network was engaged in mortgage origination, and
changed its name to Westmark Group Holdings (“Westmark”) in 1993 in connection with the acquisition of Westmark Mortgage
from Primark Corporation. Westmark ceased operations at some time in 2006, and in 2006 ceased filing reports under the Securities Exchange
Act of 1934. The corporate entity was thereafter known as Viking Consolidated, Inc. (2006), Tailor Aquaponics World Wide, Inc. (2007)
and Diversified Acquisitions (2007) until it entered the medical clinic business in early 2008. The Company has no information regarding
any business activities from 2006 after the mortgage origination business closed, to early 2008.
On
October 25, 2011, Goliath Film and Media International, a Nevada corporation, entered into an Agreement and Plan of Reorganization (the
“Exchange Agreement”), pursuant to which Goliath Film and Media International was acquired by China Advanced Technology.
Prior to the acquisition, our principal operations consisted of internet marketing, and were conducted through a wholly owned subsidiary,
Live Wise, Inc. Live Wise was disposed of on October 31, 2011 for cancellation of debt and shares described below. At the Closing Date,
there were no assets or liabilities on China Advanced Technology’s balance sheets.
The
transaction closed on October 31, 2011 (the “Closing Date”). On the Closing Date China Advanced Technology acquired Goliath
Film and Media International by issuing 47,000,000 shares of its Common Stock, constituting 70.1% of the outstanding shares after giving
effect to their issuance and the cancellation of 15,619,816 shares held by China Advanced Technology’s prior control person. Immediately
following the Closing, 67,100,000 shares were issued and outstanding. On the Closing Date, the name of China Advanced Technology was
changed to Goliath Film and Media Holdings. All share numbers herein have been adjusted for an eight-for-1 forward stock split affected
as of the Closing Date. The forward stock split was reflected in the trading market on February 13, 2012.
Overview.
Goliath
Film and Media Holdings, through its wholly-owned subsidiaries Goliath Film and Media International and Goliath Movie Partners 1, LLC
(collectively, “Goliath” or the “Company”), develops, produces and licenses for distribution, domestically and
internationally, quality digital content with an emphasis on “niche” markets of the feature motion picture and television
content segments of the entertainment industry, such as, without limitation, education, faith-based, horror and socially responsible
minority content. Goliath does not intend to engage in domestic theatrical distribution of motion pictures to any significant extent.
In
qualified cases, Goliath will develop screenplays that will be outsourced to an independent entity for production, but will be licensed
for distribution through the Company. Also, in certain cases Goliath will produce content that is tied to working with an established
distributor that provides an advance or minimum guarantee for the production of a project that will be licensed by the participating
distributor. Goliath plans to produce content and to distribute domestically and internationally, through a wide distribution network
which includes major international theatrical exhibitors, and other distributors and television networks. We plan to utilize corporate
sponsorships as a means of reducing the costs of advertising and marketing in distribution. Further, we may augment our marketing efforts
with a limited and strategically focused advertising campaign in traditional “print” media with press releases targeted specifically
toward standard entertainment industry trade journals and publications on an “as needed” basis as well as the inclusion of
targeted “social media” campaigns.
Goliath’s
revenue model includes receiving revenue from distribution fees. A limited number of its content properties include projects developed
and produced by Goliath and those produced by an independent third party production companies.
Production
Agreements
On
March 4, 2016, we signed a distribution agreement with Mar Vista Entertainment, LLC (“Mar Vista”) to distribute a feature
length motion picture currently completed. Per the agreement, we received $125,000 in advance payments per an agreed delivery schedule
for providing distribution rights on the motion picture “Bridal Bootcamp” a romantic comedy movie produced by Goliath for
delivery to Mar Vista for distribution. Additionally, Mar Vista will receive 35% of the gross proceeds for a period of 25 years on the
motion picture. As of October 31, 2016, the Company has received $125,000 of the advance payments. Bridal Boot Camp was completed in
October 2016 resulting in the recognition of the advance payments as revenue of $125,000 in October 2016. Mar Vista is distributing this
film. The Company had no revenue for the three and six months ended October 31, 2022 and 2021, respectively.
On
September 18, 2015, we signed a distribution agreement with Mar Vista to distribute a feature length motion picture currently completed.
Per the agreement, we received $125,000 in advance payments per an agreed delivery schedule for providing distribution rights on the
motion picture “Merry Exes” retitled “Girlfriends of Christmas Past” a Christmas holiday movie produced by Goliath
and delivered to Mar Vista. for distribution. Additionally, Mar Vista will receive 35% of the gross proceeds for a period of 25 years
on the motion picture. As of October 31, 2016, we have received $125,000 of the advance payments. “Merry Exes” “Girlfriends
of Christmas Past was completed June 6, 2016 resulting in the recognition of the advance payments as revenue of $125,000 in June 2016.
Mar Vista distributed this movie to UPTV. The Company had no revenue for the three and six months ended October 31, 2022 and 2021, respectively.
On
May 20, 2015, we signed a distribution agreement with Mar Vista to distribute a feature length motion picture currently completed by
us and being licensed by Mar Vista. Per the agreement, we received $175,000 in advance payments per an agreed delivery schedule for providing
distribution rights on the motion picture “Terror Birds” a science fiction movie produced by Goliath and delivered to Mar
Vista. for distribution. Additionally, Mar Vista will receive 30% of the gross proceeds for a period of 25 years on the film. As of April
30, 2016, the Company had received $175,000 of the advance payments. Terror Birds was completed December 14, 2015 resulting in the recognition
of the advance payments as revenue of $175,000 in February 2016. Mar Vista is continuing to distribute this film. The Company had no
revenue for the three and six months ended October 31, 2022 and 2021, respectively.
Questions
and Answers
What
is your business?
We
develop, produce and distribute motion pictures and digital content. At this time, we do not intend to engage in theatrical releases
of motion pictures, due to the high up- front costs of advertising and marketing theatrically. However, in some specific cases the company
will consider theatrical releases based upon a “four wall”, limited release delivery that will be focused on targeted niche
audiences.
What
is the timeline for your activities during the next 12 months?
Over
the next 90 days to one year, our efforts will be concentrated on developing and producing content with distributors for licensing by
them of at least three projects.
What
is this going to cost you?
We
expect that producing the aforementioned content will cost approximately $150,000 per project, however licensing and distribution will
be handled by an experienced distributor for a fee of anywhere from 30 – 35% and the costs of advertising and marketing will be
handled by them and charged against gross distribution licensing proceeds.
Why
are these motion pictures not being distributed already?
The
motion pictures that are being produced by the Company and distributed by Mar Vista take anywhere from six to nine months from completion
of production and delivery to obtain licensing agreements.
Generally,
the main reason why good, quality motion pictures are not distributed is that the production of a motion picture requires money and creativity,
and marketing a motion picture requires an entirely different set of skills. Many people dream of making a movie; few aspire to distribute
them. We estimate that there are in excess of 10,000 such motion pictures “gathering dust.” There also have been and continue
to be substantial tax incentives for motion picture production in many States and international Territories, so that many producers do
not need to depend on successful marketing in order to find investors for their projects. A secondary factor is the difficulty of finding
a reputable distributor. We think that our management has an excellent reputation in the industry and we will be able to obtain distribution
rights for content. Finally, many distributors as well as buyers do not have an interest in niche market films, because they see the
market as limited. Goliath sees the problem to be, rather, there is no market merely because no one has assembled a critical mass of
films for these niches. Most participants in the motion picture industry are based in “Hollywood” and the major coastal metropolitan
areas. As an example, our “faith-based” films especially are targeted toward the “Bible Belt” and the “Flyover
Country”: places that the industry has consistently overlooked.
Why
are you able to identify and acquire these motion pictures and educational videos?
After
attending all the major content acquisition markets around the world over the last three years, our Staff has developed relationships
with numerous quality filmmakers who need assistance in marketing and distributing their product. Goliath has also developed vital relationships
with many of the major content buyers, distributors, networks and sales agents. Many of the filmmakers have requested the Company’s
assistance in marketing and distributing their product. Goliath will continue to pursue the marketing and distribution of product that
is demanded in the marketplace and desired by major aggregators, distributors, networks and studios.
So
how are you different than Amazon, Netflix, and Hulu, to name a few? How can you compete with them? They have a lot of money and name
recognition. Why wouldn’t they jump into your niches?
As
a content provider we are not competing with these entities but rather are working on providing them with quality content. As an example,
NETFLIX using its “streaming platform” has such a high demand for programming content, they are spending in excess of $8
billion this year for the acquisition of completed programming as well as for the development of original content by them. Therefore,
as is mentioned, part of their resources are directed toward acquiring content and part is targeting “in-house” and joint
venture productions of quality content. This content will be targeted to their subscription base on a domestic and international level.
There
are a number of quality content producers that work with the major networks and content distributors, Goliath is moving toward becoming
one of these content providers. We believe there exists significant opportunities for our company in that the demand for programming
is increasing almost exponentially. Irrespective of the platform for viewing by the consumer/subscriber, the demand for quality content
is continuing to expand. The upward trend is ongoing, which is where we see an opportunity for Goliath to provide product to reach many
components of the overall market.
Don’t
cable and satellite networks already offer specialty channels like TBN (for faith based) and BET (Black Entertainment Television (for
the African-American Community)?
As
mentioned above about NETFLIX, even though these channels maybe in niche markets they must expand the type, genre and format of the content
that they are showing in order to remain viable, therefore the opportunity to assist them by providing quality programming is ongoing
and expanding.
What
other niches are you looking at entering?
We
believe that there is an increasing and ongoing trend in home entertainment in servicing niches. Many viewers have cable or satellite
service with hundreds of channels, but view only a few channels that cater to their particular interests. The significant type of niche
we are targeting are the numerous immigrant groups in the United States. Other than Spanish speaking immigrants, coverage is scarce.
There
are many interest groups that might be interested in specialty movies or programming. As an example, in Hawaii and Southern California,
for instance, surfing is quite popular, and there exists a huge body of surfing films which would be of interest.
What
about ancillary markets?
We
plan to incorporate advertising and marketing through social media and traditional outlets to the highest degree possible.
How
do these distribution rights work?
We
enter into a Distribution Agreement for each motion picture. Terms may be perpetual or limited by years. The motion pictures that we
are acquiring will have a term of five years. We will generally obtain a fee of 20% to 30% of gross revenues. Licensing will be flexible
for usage applications on a yearly or multi-year basis. Most markets, especially foreign territories have a tendency to continuously
renew content licensing.
How
many employees do you have? Do you have an office?
We
have no employees. Our administrative office is in Carson City, Nevada.
Do
you have a website?
Our
website is www.goliathfilmandmediainternational.com. We have a mirror site at www.goliathfilmandmedia.com
Recent
Accounting Pronouncements
We
have evaluated new accounting pronouncements that have been issued and are not yet effective for us and determined that there are no
such pronouncements expected to have an impact on our future financial statements.
Plan
of Operations
We
had a net loss of $8,404 and $25,460 for the three months and six months ended October 31, 2022, respectively, and historical losses
totaling $1,174233 as of October 31, 2022. These factors create substantial doubt about the Company’s ability to continue as a
going concern. The Company’s management plan to continue as a going concern revolves around its ability to execute its business
strategy of digital content, as well as raising the necessary capital to pay ongoing general and administrative expenses of the Company.
Results
of Operations
Three
Ended October 31, 2022 Compared to Three Months Ended October 31, 2021
Film
Production Revenue
For
the three months ended October 31, 2022 and 2021, and we had no revenues.
Cost
of Sales
During
the three months ended October 31, 2022 and 2021, we had no cost of sales.
Operating
expenses
Operating
expenses increased by $285, or 3.5%, to $8,404 in the three months ended October 31, 2022 from $8,119 in the three months ended October
31, 2021 primarily due to an increase in rent of $796, offset primarily by the decrease in professional fees of $515.
Operating
expenses for the three months ended October 31, 2022 were comprised primarily of professional fees of $4,513, consulting costs of $3,000,
rent of $796, and $95 of other operating expenses.
Operating
expenses for the three months ended October 31, 2021 were comprised primarily of professional fees of $5,028, consulting costs of $3,000,
and $91 of other operating expenses.
Net
loss before income taxes
Net
loss before income taxes for the three months ended October 31, 2022 totaling $8,404 is primarily due to professional fees, consulting
services, rent, and other operating expenses compared to a net loss for the three months ended October 31, 2021 totaling $8,119 is primarily
due to professional fees, consulting services, and other operating expenses.
Assets
and Liabilities
Total
assets were $445 as of October 31, 2022 compared to $497 as of April 30, 2022, or a decrease of $52, primarily the result of a decrease
in cash. Total liabilities were $202,680 as of October 31, 2022 compared to $177,272 as of April 30, 2022, or an increase of $25,408,
primarily the result of an increase in accounts payable – related party of $28,075, offset partially by accounts payable and accrued
expenses of $2,667.
Six
Months Ended October 31, 2020 Compared to Six Months Ended October 31, 2019
Film
Production Revenue
For
the six months ended October 31, 2022 and 2021, we had no revenues.
Cost
of Sales
For
the six months ended October 31, 2020 and 2019, we had no cost of sales.
Operating
expenses
Operating
expenses increased by $3,786, or 17.5%, to $25,460 in the six months ended October 31, 2022 from $21,674 in the six months ended October
31, 2021 primarily due to an increase in professional fees of $6,126, offset primarily by a decrease in consulting services of $3,000.
Operating
expenses for the six months ended October 31, 2022 were comprised primarily of professional fees of $21,070, office rent of $1,194, consulting
services of $3,000, and $196 of other operating expenses.
Operating
expenses for the six months ended October 31, 2021 were comprised primarily of professional fees of $14,944, office rent of $1,194, and
consulting services of $6,000.
Net
loss before income taxes
Net
loss before income taxes for the six months ended October 31, 2022 totaling $25,460 is primarily due to consulting services costs, professional
fees, and rent compared to net loss for the six months ended October 31, 2021 totaling $21,674 primarily due to professional fees, consulting
services, and rent.
Liquidity
and Capital Resources
General
– Overall, we had a decrease in cash of $52 in the six months ended October 31, 2022 resulting from cash used in operating
activities of $4,302.
The
following is a summary of our cash flows provided by (used in) operating, investing, and financing activities during the periods indicated:
| | |
Six Months Ended October 31, | |
| | |
2022 | | |
2021 | |
| | |
| | |
| |
| Cash at beginning of period | |
$ | 198 | | |
$ | 14,534 | |
| Net cash used in operating activities | |
| (4,302 | ) | |
| (17,747 | ) |
| Net cash used in investing activities | |
| — | | |
| — | |
| Net cash provided by financing activities | |
| 4,250 | | |
| 4,000 | |
| Cash at end of period | |
$ | 146 | | |
$ | 787 | |
Net
cash used in operating activities was $4,302 for the six months ended October 31, 2022 compared to net cash used in operations for the
six months ended October 31, 2021 of $17,747. Cash used in operations for the six months ended October 31, 2022 consisted of a net loss
of $25,460 and the change in accounts payable and accrued expenses of $2,667, offset partially by expenses paid on behalf of Company
– related party of $23,825. Cash used in operations for the six months ended October 31, 2021 consisted of a net loss of $21,674,
the change in accounts payable and accrued expenses of $1,352, and the expenses paid on behalf of Company – related party of $5,575,
and a decrease in accounts payable – related party of $3,000.
Net
cash provided by investing activities was $0 for the six months ended October 31, 2022 and October 31, 2021.
Net
cash provided by financing activities was $4,250 for the six months ended October 31, 2022 consisting of advances from a related party.
Net cash provided by financing activities was $4,000 for the six months ended October 31, 2021 consisting of advances from a related
party.
Our
cash needs for the year ending April 30, 2023 are estimated to be $35,000 based on the assumption that we will need general and administrative
expenses for the costs related to being public, and miscellaneous office expenses. We sold no shares during the three and six months
ended October 31, 2022 and 2021. As we move forward with our business plan, we will need to raise additional capital either through the
sale of stock or funding from shares and or officers and directors to cover our cash needs through the end of the 2021 fiscal year.
Information
included in this report includes forward looking statements, which can be identified by the use of forward-looking terminology such as
may, expect, anticipate, believe, estimate, or continue, or the negative thereof or other variations thereon or comparable terminology.
The statements in “Risk Factors” and other statements and disclaimers in this report constitute cautionary statements identifying
important factors, including risks and uncertainties, relating to the forward-looking statements that could cause actual results to differ
materially from those reflected in the forward-looking statements.
Equity
Financing
During
the three and six months ended October 31, 2022 and October 31, 2021, the Company did not enter into any private placement memorandums.
During
the three and six months ended October 31, 2022 and 2021, the Company has not issued a total of 38,153,269 common shares (6,000,000 common
shares due to a third party and 32,153,269 common shares due to related party affiliates). These shares are reflected in the above disclosures.
Advances
from related party
The
Company borrows funds from the Company’s affiliates for working capital purposes from time to time. The Company has recorded the
principal balance due of $12,735 and $8,485 included under accounts payable - related party in the accompanying Balance Sheets at October
31, 2022 and April 30, 2022, respectively. The Company received advances of $400 (from C&R Films, C&R Films is controlled by
Lamont Roberts, CEO and acting CFO of the Company) and $4,250 ($500 from C&R Films and $3,750 from Mike Criscione, Director on the
Company’s Board of Directors), respectively, and no repayments for the three and six months ended October 31, 2022, respectively.
The Company received advances of $0 and $4,000 (from Mike Criscione), respectively, and no repayments for the three and six months ended
October 31, 2021, respectively.
Other
During
the three and six months ended October 31, 2022 and 2021, the Company made no payments to Lamont Roberts, CEO and acting CFO of the Company,
and Mr. Roberts incurred no expenses on behalf of the Company. The Company has a balance owed to Mr. Roberts of $250 at October 31, 2022.
During
the three and six months ended October 31, 2022 and 2021, the Company made no payments to C&R Films for film production costs and
reimbursement of various expenses. C&R Films paid expenses totaling $199 and $597, and $0 and $0 in the three and six months ended
October 31, 2022 and 2021, respectively, in operating expenses including rent, filing expenses, and accounting costs on behalf of the
Company. The Company received advances of $400 and $500, and $0 and $0 and had no repayments during the three and six months ended October
31, 2022 and 2021, respectively. C&R Films is controlled by Lamont Roberts, CEO and acting CFO of the Company. The Company has a
balance owed to C&R Films of $39,423 at October 31, 2022.
During
the three and six months ended October 31, 2022 and 2021, the Company made no payments to Dos Cabezas for film production costs and reimbursement
of various expenses. Dos Cabezas paid expenses totaling $0 and $0, and $0 and $0 in the three and six months ended October 31, 2022 and
2021, respectively, in operating expenses including accounting costs on behalf of the Company. Dos Cabezas is controlled by Lamont Roberts,
CEO and acting CFO of the Company. The Company has a balance owed to Dos Cabezas of $14,394 at October 31, 2022.
During
the three and six months ended October 31, 2022 and 2021, Kevin Frawley, an affiliate, paid expenses totaling $0 and $2,228, and $0 and
$0, respectively, in operating expenses, including audit fees, on behalf of the Company. The Company has a balance owed to Mr. Frawley
of $23,468 at October 31, 2022.
During
the three months ended July 31, 2022 and 2021, the Company made no payments to Mike Criscione, Director, for reimbursement of various
expenses. During the three and six months ended October 31, 2022 and 2021, Mr. Criscione paid expenses totaling $6,000 and $24,750, and
$5,575 and $9,575, respectively, in operating expenses, including audit fees, on behalf of the Company. The Company received advances
of $3,750 and $0 and had no repayments during the three months ended July 31, 2022 and 2021, respectively. The Company has a balance
owed to Mr. Criscione of $56,650 at July 31, 2022.
Motion
Picture Residual Payments
The
Company is obligated to pay motion picture residual payments of 3.6% of gross licensing revenues collected by Mar Vista for residual
earnings to the pension and health benefit plans on behalf of the actors that performed in the motion pictures. During the three and
six months ended October 31, 2022, the Company made payments totaling $0 and $3,750 and has a balance owed of $52,222 as of October 31,
2022 which is included in accounts payable and accrued expenses.
Contractual
Obligations and Off-Balance Sheet Arrangements
We
do not have any contractual obligations or off balance sheet arrangements.