ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION
FORWARD LOOKING STATEMENTS
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 of 1934. 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.
General
Umax Group Corp. was incorporated in the State of Nevada as a for-profit company on March 21, 2011 and established a fiscal year end of April 30. We do not have revenues, have minimal assets and have incurred losses since inception. We are a development-stage company formed to develop and distribute our product to the arcade and entertainment industry. To date, we have had limited operations. We have developed our business plan, and executed Exclusive Distribution Contract "GEO" a private enterprise, where we engage "GEO” as an independent contractor for the specific purpose of developing, manufacturing and supplying games for us.
Product
We plan to distribute the product line which consists of:
- Rocket Launch:
Strength testing game which allows players to test their pushing/ throwing strength. Simple deign, easy servicing and diagnostics.
- Space Hockey:
Two player hockey game - each player must score as many as possible goals. Exchangeable electronics with Rocket Launch which makes it cost-effective to manufacture because one set of electronics can be used. This game is designed for all ages.
- Boxer:
Simple punch testing game: insert coin/token/bill, press start button, hit the punch bag, wait for result, and try to beat opponent’s score or high score. Simple deign, easy servicing and diagnostics
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RESULTS OF OPERATION
We are a development stage company and have not generated any revenue to date. We have incurred recurring losses to date. Our 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. We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.
NINE MONTH PERIOD ENDED JANUARY 31, 2013 COMPARED TO THE NINE MONTH PERIOD ENDED JANUARY 31, 2012
Our net loss for the nine month period ended January 31, 2013 was $31,071 compared to a net loss of $2,300 for the nine month period ended January 31, 2012. During the nine month period ended January 31, 2013, we did not generate any revenue.
During the nine month period ended January 31, 2013, we incurred general and administrative expenses $31,071 compared to $2,300 incurred for the nine month period ended January 31, 2012. General and administrative and professional fee expenses incurred during the nine month period ended January 31, 2013 were generally related to corporate overhead, financial and administrative contracted services, such as legal and accounting, developmental costs, and marketing expenses.
The weighted average number of shares outstanding was 154,592,754 for the nine month period ended January 31, 2013.
LIQUIDITY AND CAPITAL RESOURCES
NINE MONTH PERIOD ENDED JANUARY 31, 2013
As at January 31, 2013, our current assets were $2,011 compared to $19,115 in current assets at April 30, 2012. Current assets were comprised of $161 in cash and $1,850 in prepaid expenses. As at January 31, 2013, our current liabilities were $18,519. Current liabilities were comprised of $18,319 in loan from Director and $200 in accounts payable.
Stockholders’ deficit was $16,508 as of January 31, 2013 compare to stockholders’ equity of $14,563 as of April 30, 2012.
CASH FLOWS FROM OPERATING ACTIVITIES
We have not generated positive cash flows from operating activities. For the nine month period ended January 31, 2013, net cash flows used in operating activities was $24,504 consisting of a net loss of $31,071, decrease in accounts payable of $733 and decrease in prepaid expenses of $7,300. Net cash flows used in operating activities was $46,458 for the period from inception (MARCH 21, 2011) to January 31, 2013.
CASH FLOWS FROM FINANCING ACTIVITIES
We have financed our operations primarily from either advancements or the issuance of equity and debt instruments. For the nine month period ended January 31, 2013 cash flows provided by financing activities was$14,700 received from loan from Director. For the period from inception (MARCH 21, 2011) to January 31, 2013, net cash provided by financing activities was $46,619 received from proceeds from issuance of common stock and loan from Director.
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PLAN OF OPERATION AND FUNDING
Our cash reserves are not sufficient to meet our obligations for the next twelve month period. As a result, we will need to seek additional funding in the near future. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of equity financing from the sale of shares of our common stock. We may also seek to obtain short-term loans from our directors or unrelated parties, although no such arrangements have been made. We do not have any arrangements in place for any future equity financing.
MATERIAL COMMITMENTS
As of January 31, 2013, we had no material commitments.
PURCHASE OF SIGNIFICANT EQUIPMENT
We do not intend to purchase any significant equipment during the next twelve months.
OFF-BALANCE SHEET ARRANGEMENTS
As 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.
GOING CONCERN
The independent auditors' audit report accompanying our April 30, 2012 financial statements contained an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared "assuming that we will continue as a going concern," which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.
