This Form 10-K contains certain forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. For this purpose, any
statements contained in this Form 10-K that are not statements of historical
fact including, without limitation, statements under "Item 7. Management's
Discussion and Analysis of Financial Condition and Results of Operations"
regarding the Company's financial position, business strategy and the plans and
objectives of management for future operations, may be deemed to be
forward-looking statements. Such forward-looking statements are based on the
beliefs of management, as well as assumptions made by, and information currently
available to, the Company's management. Actual results could differ materially
from those contemplated by the forward-looking statements as a result of certain
factors detailed in our filings with the SEC.
The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with the financial statements and the
notes thereto contained elsewhere in this Report. Certain information contained
in the discussion and analysis set forth below includes forward-looking
statements that involve risks and uncertainties.
This Annual Report contains forward-looking statements that are subject to a
number of risks and uncertainties, many of which are beyond our control, which
may include statements about our:
? business strategy;
? financial strategy;
? intellectual property;
? production;
? future operating results; and
? plans, objectives, expectations and intentions contained in this report that
are not historical.
All statements, other than statements of historical fact included in this
report, regarding our strategy, intellectual property, future operations,
financial position, estimated revenues and losses, projected costs, prospects,
plans and objectives of management are forward-looking statements. When used in
this report, the words "could," "believe," "anticipate," "intend," "estimate,"
"expect," "project" and similar expressions are intended to identify
forward-looking statements, although not all forward-looking statements contain
such identifying words. All forward-looking statements speak only as of the date
of this report. You should not place undue reliance on these forward-looking
statements. Although we believe that our plans, intentions, and expectations
reflected in or suggested by the forward-looking statements we make in this
report are reasonable, we can give no assurance that these plans, intentions or
expectations will be achieved. These statements may be found under "Management's
Discussion and Analysis of Financial Condition and Results of Operations," as
well as in this report generally. Actual events or results may differ materially
from those discussed in forward-looking statements as a result of various
factors. In light of these risks and uncertainties, there can be no assurance
that the forward-looking statements contained in this filing will in fact occur.
6
Organizational History
Creations, Inc. was incorporated in May 2019. On July 1, 2019, Creations, Inc,
acquired a 100% interest in Ocean-Yetsira Ltd (. former- Yetsira Holdings Ltd) ,
through a share swap agreement. Ocean Yetsira is an Israeli Corporation
incorporated in December 2017 which in turn owns 100% of Yetsira Investment
House ("Yetsira"), which was incorporated in November 2016.
On August 19, 2020, the Company purchased 7.5% of the outstanding and issued
shares of Ocean Partners Y.O.D.M Ltd., an Israeli corporation ("Ocean") for
total cash consideration of approximately $87,000. On September 7, 2020, the
Company entered into a share exchange agreement by and among Yetsira, Ocean, and
certain shareholders of Ocean, pursuant to which the Company acquired the
remaining 92.5% of the capital stock of Ocean in exchange for an aggregate of
1,254,498 shares of common stock of the Company, $0.001 par value, and 1,254,498
warrants to purchase shares of common stock of the Company (the "Warrants")
issued to the certain Ocean shareholders by the Company. The Warrants are
convertible into shares of our common stock over a period of three-years at an
exercise price of $1.00 per share. The Company completed the acquisition on
September 28, 2020.
Following the acquisition of Ocean, all the investment management business of
the group is managed through Ocean.
On August 31, 2020, the Company's registration statement on Form S-1 was
declared effective by the U.S. Securities and Exchange Commission. As at the
date of filing this report, the Company's shares have not begun to be quoted on
the OTCQB.
On April 17, 2022, the board of directors approved a resolution as to matters of
ongoing conduct such as signatory rights, voting etc. In addition, compensation
of officers was updated. Also, non-committal guidelines for future transactions
regarding sale of main activity to related parties and sale of holdings by those
parties were discussed, these guidelines are pursuant to completion of legal
structuring, compliance issues and more.
On February 9, 2023, the Company entered into a share exchange agreement (the
"Share Exchange Agreement") by and among Aharon Barkai & Co. Ltd. (the
"Purchasers") through its controllers Yaniv Aharon and Dan Barkai, and an
agreement for the purchase of Shares and Capital Notes (the "Purchase
Agreement"), whereby the Company sold all of the capital stock and capital notes
of Ocean Yetsira Ltd. ("Ocean") in exchange for the payment of an aggregate of
ILS 2,061,930 (approximately $586,000) and the return of 1,254,498 shares of
common stock of the Company and 1,254,498 warrants to purchase common stock
owned by the Purchasers. The transactions contemplated in the Purchase Agreement
and the Share Exchange Agreement are collectively referred to as the
"Transaction"). Mr. Aharon is a director of the Company. The Capital Notes in
the amount of ILS 2,165,800 (approximately $615,000) which are owed to the
Company by Ocean will be repaid by the Purchasers at closing as well. The
closing of the transaction was subject to the approval of the Court of Family
Affairs to allow the Executor of the Estate of Guy Nissenson to sign upon behalf
of the Estate and to approval of the Company's stockholders. On March 20, 2023,
such approval was obtained.
Recently Issued Accounting Pronouncements
Management reviewed currently issued pronouncements during the year ended
December 31, 2022, and does not believe that any recently issued, but not yet
effective, accounting standards if currently adopted would have a material
effect on the accompanying condensed financial statements.
Critical Accounting Estimates
Our financial statements and accompanying notes have been prepared in accordance
with United States generally accepted accounting principles applied on a
consistent basis. The preparation of financial statements in conformity with
U.S. generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities, the disclosure of contingent assets and liabilities as of the date
of the financial statements and the reported amounts of revenues and expenses
during the reporting periods.
We regularly evaluate the accounting policies and estimates that we use to
prepare our consolidated financial statements. Management's estimates are based
on historical experience, on information from third party professionals, and on
various other assumptions that are believed to be reasonable under the facts and
circumstances. Actual results could differ from those estimates made by
management.
Results of Operations for the Year Ended December 31, 2022 compared to Year
Ended December 31, 2021. (In Thousands)
Following the agreement described above, the company classified its investments
in Ocean Yetsira Ltd, Yetsira Investment House Ltd. and Ocean Partners Y.O.D.M
Ltd. (the sold companies) as of December 31, 2022, as an assets held for sale
valued at $1,378.
7
General and Administrative Expenses
For the year ended December 31, 2022, our general and administrative expenses
were $159 from continuing operations, compared to $23 for the year ended
December 31, 2021, those increase in expenses attributed to dividing mutual
expenses of the sold companies and the parent company, and increase in
professional fees such as attorney and CPA to accomplish the sale of the
companies.
Discontinued operations
Net loss from continuing operations for the years ended on December 31, 2022,
and 2021, amount to loss off $220 and $23 respectively, Income (loss) arising
from the sold companies for the years ended on December 31, 2022, and 2021 is
presented in the statements of operations and comprehensive as income from
discontinued operations amounted to income of $194 and loss of 80, respectively.
Net Loss
The Company realized a net loss of $26 for the year ended December 31, 2022,
compared to a net loss of $103 for the year ended December 31, 2021. The
decrease in net loss attributed to income from discontinued operations.
After taking into account foreign currency translation adjustments, which
resulted in other comprehensive loss of $179 and income of $49 for the year
ended December 31, 2022, and 2021, respectively, the Company realized a net loss
after other comprehensive expenses of $205 and $54 for the year ended December
31, 2022 and 2021, respectively.
Liquidity and capital resources
As of December 31, 2022, the Company had cash from continued operations in the
amount of $114 compared to cash in the amount of $195 as of December 31, 2022.
Stockholders' equity as of December 31, 2022 was $1,360, as compared to
stockholders' equity of $1,565 as of December 31, 2021.
The Company's accumulated deficit was $1,778 and $1,752 on December 31, 2022 and
December 31, 2021, respectively.
Off- Balance Sheet Arrangements
The Company currently does not have any off-balance sheet arrangements.
ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS
The Results of Operations of the sold companies for the Year Ended December 31,
2022, compared to Year Ended December 31, 2021. (In Thousands)
Revenue
For the year ended December 31, 2022, and 2021, the held for sale Companies
generated revenues in the amount of $2,333 and $2,030 respectively. The increase
was attributable to an increase in AUM.
8
Assets Under Management and Investment Performance
The following table reflects the changes in AUM for the year ended December 31,
2022, and 2021.
(In millions)
For the year ended For the year ended
December 31, 2022 December 31, 2021
Beginning Balance $ 282.73 $ 180.96
Gross inflows/ outflows, net 118.07 65.77
Market appreciation (depreciation) (1) (83.72 ) 35.99
End Balance $ 317.08 $ 282.73
(1) Market appreciation (depreciation) includes investment gains (losses) on
assets under management, the impact of foreign exchange rates and net
reinvested dividends.
Total AUM increased by $34.35 million during the year ended December 31, 2022,
from $282.73 million as of December 31, 2021 to $317.08 million as of December
31, 2022, or a 12.14 % increase on total AUM. The increase was a result of net
AUM inflows of $118.07 million, and market depreciation of $83.72 million.
Cost of Revenues
For the year ended December 31, 2022, and 2021, cost of revenues was $1,288 and
$1,186, respectively. The increase in these expenses was mainly attributable to
an increase in AUM.
Marketing Expenses
For the year ended 31, 2022, marketing expenses were $208, compared to $210 for
the prior-year period.
General and Administrative Expenses
For the year ended December 31, 2022, our general and administrative expenses
were $618, compared to $746 for the period ended December 31, 2021, an
approximate 17.1% decrease.
Net Loss
The sold Company realized a net income of $194 for the year ended December 31,
2022, compared to a net loss of $80 for the year ended December 31, 2021. This
attributed to increased revenue following the grows of our AUM.
After taking into account foreign currency translation adjustments, which
resulted in other comprehensive loss of $179 and income of $49 for the year
ended December 31, 2022 and 2021, respectively, the Company realized a net
income after other comprehensive income of $15 and loss of $31 for the year
ended December 31, 2022 and 2021, respectively.
© Edgar Online, source Glimpses
CHINA EDUCATION ALLIANCE, INC. 
