ARVANA INC. FORWARD LOOKING STATEMENTS
This Management's Discussion and Analysis of Financial Condition and Results of Operations and other parts of this quarterly report contain forward-looking statements that involve risks and uncertainties. Forward-looking statements can also be identified by words such as "anticipates," "expects," "believes," "plans," "predicts," and similar terms. Forward-looking statements are not guarantees of future performance and our actual results may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such differences include but are not limited to those discussed in the subsection entitled Forward-Looking Statements and Factors That May Affect Future Results and Financial Condition below. The following discussion should be read in conjunction with our financial statements and notes thereto included in this report. Our fiscal year end isDecember 31 . All information presented herein is based on the three and six months endedJune 30, 2022 , andJune 30, 2021 . Overview The Company was incorporated in theState of Nevada onJune 16, 1977 , as "Turinco, Inc. " OnJuly 24, 2006 , the Company's changed its name toArvana Inc. on closing the acquisition ofArvana Networks, Inc. , a telecommunications business. We discontinued efforts related to that business as ofDecember 31, 2009 . Our present activities are focused on evaluating business opportunities that are sufficient to support operations and increase stockholder value. Our office is located at299 S. Main Street , 13th Floor,Salt Lake City, Utah 84111, and our telephone number is (801) 232-7395. AA Registered Agents,4869 Nightwood Court ,Las Vegas, Nevada 89149, is our registered agent in theState of Nevada . The Company is registered with the Commission and traded on the OTC Markets Group, Inc.'s Pink Sheets Current Information over the counter market platform under the symbol "AVNI."
The Company is a shell company as that term is defined in Rule 12b-2 of the Exchange Act.
Company
On May 10, 2022 , certain of our affiliated and unaffiliated stockholders sold
31,102,882 shares of the Company's common stock in a private transaction that
transferred 91.08% of our outstanding common stock on a fully diluted basis,
that resulted in a change in control of the Company. Shortly thereafter, we
announced a non-brokered private placement to finance a business development
strategy focused on the acquisition and redevelopment of undervalued commercial
properties that could be repurposed to realize latent value. The intention being
to purchase vacant shopping malls, big box stores and otherwise underused
commercial real estate at a fraction of replacement cost to be remediated for
specific targeted industries that offer goods or services not otherwise
available online. We recently expanded our intended business development
strategy to include a plan to form a brokerage division to facilitate
international transactions in the delivery of oil and gas products to match
sellers with buyers in the energy sector. The brokerage division would be tasked
with securing crude oil from sellers in the Middle East through purchase orders
and letters of credit from buyers in the Asia Pacific region to facilitate the
procurement, payment and delivery of energy. We would expect to earn fees on
completed transactions.
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While we are in the process of conducting the private placement and evaluating
specific opportunities in the sectors of interest described above, though the
Company is yet to enter into any definitive agreements attendant to its stated
business development strategy.
The Company entered into a non-binding term sheet on May 21, 2021 , intended to
facilitate the acquisition of a multi-media platform and related businesses. Due
to disagreement over the structure of the intended transaction, the parties
thereto signed a recission agreement and mutual release on October 26, 2021 .
On March 17, 2016 , the Company entered into a non-binding memorandum of
understanding with the intention to acquire a fresh foods manufacturing and
distribution business. The target loaned the Company $174,610 over nearly five
years but was unable to deliver the information necessary to complete the
transaction. We notified the target on November 11, 2020 , that the Company would
no longer pursue the intended acquisition of its business. Amounts due to the
target were extinguished effective April 1, 2020 , in exchange for shares of
our
common stock.
Plan of Operation
Our present activities are focused on realizing the Company's business development strategy to build stockholder value.
Results of Operations
During the three and six-months ended
Operations for the three and six-months ended
Three months Three months
ended ended Six months ended Six months ended
June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021
Operating Expenses
General and administrative $ 10,720 $ 3,754 $ 16,856 $ 7,114
Professional fees 5,061 13,894 7,561 21,207
Loss from Operations (15,781 ) (17,648 ) (24,417 ) (28,321 )
Interest (393 ) (6,823 ) (587 ) (19,122 )
Foreign exchange gain - (14,254 ) - 6,459
Other income 15,000 458,833 15,000 458,833
Net loss for the period $ (1,174 ) $ 420,108 $ (10,004 ) $ 417,849
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Net Loss/Income
Net loss for the three months ended June 30, 2022 , was $1,174 as compared to net
income of $420,108 for the three months ended June 30, 2021 . Net loss for the
six months ended June 30, 2022 , was $10,004 as compared to net income of
$417,849 for the six months ended June 30, 2021 . While general and
administrative fees increases were offset by decreases in professional fees in
the three and six-month comparative periods, the transition from net income to
net loss can be primarily attributed to the decreases in other income in the
current periods. Other income in the three and six-month periods ended June 30,
2022 , was the result of a non-interest bearing loan due on demand from our
controlling stock holder, while other income in the three and six-month periods
ended June 30, 2021 , was the result of debt forgiveness and the extinguishment
of debt.
We did not generate revenue during this period and expect to continue to incur losses until such time as our business development strategy is implemented.
Capital Expenditures
The Company expended no amounts on capital expenditures for the three and
six-month periods ended
Liquidity and Capital Resources
Since inception, we have experienced significant changes in liquidity, capital resources, and stockholders' deficiency.
The Company had assets of$13,195 in cash as ofJune 30, 2022 , and a working capital deficit of$111,589 as compared to assets of$3,340 in cash as ofDecember 31, 2021 , and a working capital deficit of$101,585 . Net stockholders' deficit was$111,589 as ofJune 30, 2022 , as compared to a net stockholder's deficit of$101,585 as ofDecember 31, 2021 .
Cash Used in Operating Activities
Net cash flow used in operating activities for the six-month period endedJune 30, 2022 , was$11,061 as compared to net cash flow used in operating activities of$5,517 for the six-month period endedJune 30, 2021 . Net cash used in operating activities can be attributed to a number of book expense items that do not affect the total amount relative to actual cash used, such as unrealized foreign exchange loss and interest expense. Balance sheet accounts that affect cash but are not income statement related items that are added or deducted to arrive at net cash used in operating activities, include accounts payable and amounts due to related parties. We expect to continue to use net cash flow in operating activities over the next twelve months or until such time as the Company generates sufficient income to offset the cost of operating activities.
Cash Used in Investing Activities
Net cash used in investing activities for the six-month periods ended
We do not expect to use net cash in investing activities until such time as our business development strategy is implemented.
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Cash Flows from Financing Activities
Net cash provided by financing activities for the six-month period endedJune 30, 2022 , was$20,916 as compared to net cash provided by financing activities of$16,125 for the six-month period endedJune 30, 2021 . Net cash provided by financing activities in both six-month periods consisted of proceeds from a credit agreement with one of our stockholders.
We expect to continue to rely on net cash provided by financing activities in future periods to support operations and implement our business development strategy.
The Company's assets were insufficient as ofJune 30, 2022 , to conduct its plan of operation. Management estimates that it will need at least$50,000 to sustain operations and another$200,000 to implement its business development strategy. We are currently conducting a private equity offering in an effort to meet our objectives, and will continue to look to stockholders or third-parties to secure necessary financing. Management is confident that its efforts to realize sufficient funding will be successful and looks forward to first steps in building the Company's business.
The Company does not intend to pay cash dividends in the foreseeable future.
The Company had no lines of credit or other bank financing arrangements as of
The Company had no commitments for future capital expenditures as of
The Company has no defined benefit plan or contractual commitment with any of its officers or directors.
The Company has no current plans for the purchase or sale of any plant or equipment.
The Company has no current plans to make any changes in the number of employees.
Off-Balance Sheet Arrangements
As ofJune 30, 2022 , we have no significant 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 stockholders.
Critical Accounting Policies
In Note 2 to the audited financial statements for the years endedDecember 31, 2021 , and 2020, included in our Form 10-K, the Company discusses those accounting policies that are considered to be significant in determining the results of operations and its financial position. The Company believes that accounting principles utilized by it conform to accounting principles generally accepted inthe United States . The preparation of financial statements requires Company management to make significant estimates and judgments that affect the reported amounts of assets, liabilities, revenues, and expenses. By their nature, these judgments are subject to an inherent degree of uncertainty. On an on-going basis, the Company evaluates estimates. The Company bases its estimates on historical experience and other facts and circumstances that are believed to be reasonable, and the results form the basis for making judgments about the carrying value of assets and liabilities. The actual results may differ from these estimates under different assumptions or conditions.
Going Concern
Management has expressed an opinion as to the Company's ability to continue as a going concern despite an accumulated deficit of$36,098,976 since inception and negative cash flows from operating activities as ofJune 30, 2022 . The Company's ability to continue as a going concern requires that it procure funding from outside sources. Management's plan to address the Company's ability to continue as a going concern includes obtaining funding from the private placement of equity and building value through its business development strategy. Management believes that the Company will remain a going concern through implementing its plan, though it can provide no assurances that such plan will prove successful.
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