FORWARD-LOOKING STATEMENTS
This quarterly report contains forward-looking statements. These statements
relate to future events or our future financial performance. In some cases, you
can identify forward-looking statements by terminology such as "may", "should",
"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 that may cause our or our industry's
actual results, levels of activity, performance or achievements to be materially
different from any future results, levels of activity, performance or
achievements expressed or implied by these forward-looking statements. Although
we believe that the expectations reflected in the forward-looking statements are
reasonable, we cannot guarantee future results, levels of activity, performance
or achievements. 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.
Our financial statements are prepared in accordance with United States Generally
Accepted Accounting Principles. The following discussion should be read in
conjunction with our financial statements and the related notes that appear
elsewhere in this quarterly report. The following discussion contains
forward-looking statements that reflect our plans, estimates and beliefs. Our
actual results could differ materially from those discussed in the
forward-looking statements. Factors that could cause or contribute to such
differences include, but are not limited to, those discussed below and elsewhere
in this quarterly report.
In this quarterly report, unless otherwise specified, all dollar amounts are
expressed in United States dollars and all references to "common shares" refer
to the common shares in our capital stock.
As used in this quarterly report, the terms "we", "us", "our" and "our company"
mean Lingerie Fighting Championships, Inc., unless otherwise indicated.
General Overview
We were incorporated under the laws of the State of Nevada on November 29, 2006
under the name "Sparking Events, Inc.". Our name was changed to Xodtec Group
USA, Inc. in June 2009, Xodtec LED, Inc. in May 2010, Cala Energy Corp. in
September 2013 and Lingerie Fighting Championships, Inc. on April 1, 2015.
We are a media company focused on the development, production, promotion and
distribution of original entertainment which we plan to make commercially
available predominantly through live entertainment events, as well as through
digital home video, broadcast television networks, video-on-demand and digital
media channels.
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Our business and corporate address is 6955 North Durango Drive, Suite 1115-129,
Las Vegas NV 89149. Our corporate website is http://lingeriefc.com/.
We do not have any subsidiaries.
We have never declared bankruptcy nor have we ever been in receivership.
Our Current Business
Our LFC business and brand is focused on building and establishing a sports
entertainment league that utilizes wrestling and mixed martial arts ("MMA")
fighting techniques for purposes of providing entertainment. We seek to promote
and market our brand, our programming, our events and our products.
Our mission is to establish the popularity of our LFC league and brand based on
holding live events and to promote our athletes via a reality series and
merchandise such a t-shirts and calendars. Our uniqueness is derived from our
predominantly all female league structure, where a vast array of beautiful,
attractive and unique women engage in wrestling and MMA fighting techniques
against one another for purposes of delivering high quality entertainment to
mature audiences.
Our management believes that the LFC league and our unique approach in applying
a predominantly all female league structure to wrestling and mixed martial arts
gives us a substantial competitive advantage to build the popularity of the LFC
league in general.
Recent Business Development
On May 5, 2021, we have been booked to perform three events at the Sturgis
Buffalo Chip during the closing weekend of the 2021 Sturgis Motorcycle Rally in
Sturgis, SD.
On May 17, 2021, we have inked a deal with Johnny Cafarella who will oversee the
creation of a brand new television series about the controversial MMA league.
Cafarella is best known as the co-founder and producer of GLOW which saw a
resurgence in popularity recently with the success of the GLOW series on
Netflix.
On June 15, 2021, we have added Christopher Crotte (aka The SuperBeast) to their
ranks as a trainer and coach for the upcoming events at the Sturgis Motorcycle
Rally.
On June 21, 2021, we have partnered with Agape Impetus Dunamis Ministries (AIDM)
as one of the league's principal sponsors at their 3 upcoming events at the
Sturgis Motorcycle Rally. The California-based ministry created an inspirational
design which will adorn the LFC ring during the league's events on the closing
weekend of the Rally which is expected to draw as many as 750,000 bike
enthusiasts.
In July 2021, we were approached by a company called Scuffle LLC who specialize
in launching Roku channels. We have partnered with them to launch our own
channel we'll be calling "LFC Network". The channel will carry our past events,
our reality series and several new series we plan to create. It will be similar
in scope to WWE Network. It will be funded by a combination of subscription
fees, advertisers and sponsors, both self generated and placed by Roku itself.
On August 27, 2021, we announced LFC35: Booty Camp 3D which would take place
Halloween in Las Vegas and would be shot using 360 degree virtual reality
cameras.
On September 1, 2021, we announced the launch of LFC Madness 2, a follow-up to
our first LFC Madness bracket style virtual tournament. Once again the two
prospects with the most votes would fight each other at LFC35 and each would
receive a $1200 diamond bracelet courtesy Boston Diamonds & Bling.
On October 1, 2021, LFC Network was launched on schedule on Roku.
On October 19, 2021, we launched our own branded CBD pain relief cream called
'LFC True Relief'. The product is available for sale on our site.
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Results of Operations
Three months ended June 30, 2022 as compared to the three months ended June 30,
2021
Our operating results for the three months ended June 30, 2022 and 2021, and the
changes between those periods for the respective items are summarized as
follows:
Three Months Ended
June 30, Changes
Statement of Operations Data: 2022 2021 Amount %
Revenue $ 32,273 $ 27,426 $ 4,847 18 %
Cost of Services (14,957 ) (5,027 ) (9,930 ) 198 %
Total operating expenses (49,700 ) (72,897 ) 23,197 (32 %)
Other income (expense) 972,705 705,052 267,653 38 %
Net Income (loss) $ 940,322 $ 654,554 $ 285,768 44 %
Revenues
We generated revenues of $32,273 and $27,426 for the three ended June 30, 2022
and 2021, respectively. The Company's revenue derives from the development,
promotion and distribution of our live events, televised entertainment
programming and site subscription. The increase in revenues was attributed to an
increase in live event revenue.
Cost of Services
We incurred total cost of services of $14,957 and $5,027 for the three months
ended June 30, 2022 and 2021, respectively. The cost of services incurred
consist of labor, material, equipment and subcontractor expenses.
Operating Expenses
We incurred total operating expenses of $49,700 and $72,897 for the three months
ended June 30, 2022 and 2021, respectively. The decrease in operating expenses
was primarily due to the decrease in e-commerce and travel expense.
Other Income (Expenses)
We recognized total other income of $972,705 and $705,052 for the three months
ended June 30, 2022 and 2021, respectively. The increase in other income was
mainly attributed to an increase in gain on changes in fair value of derivatives
from the convertible notes and warrants and a decrease in accrued interest
expenses from convertible notes and promissory notes during the three months
ended June 30, 2022.
Net Income (Loss)
We recognized net income of $940,322 and $654,554 during the three months ended
June 30, 2022 and 2021, respectively. The increase in our net income was mainly
attributed to the increase in other income and the decrease in operating expense
during the three months ended June 30, 2022.
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Six months ended June 30, 2022 as compared to the six months ended June 30, 2021
Our operating results for the six months ended June 30, 2022 and 2021, and the
changes between those periods for the respective items are summarized as
follows:
Six Months Ended
June 30, Changes
Statement of Operations Data: 2022 2021 Amount %
Revenue $ 53,438 $ 34,502 $ 18,936 55 %
Cost of services (14,957 ) (26,032 ) 11,075 (43 %)
Gross profit (loss) 38,481 8,470 30,011 354 %
Total operating expenses (130,512 ) (132,704 ) 2,192 (2 %)
Other income (expense) 1,836,338 (6,768,252 ) 8,604,590 (127 %)
Net income (loss) $ 1,744,308 $ (6,892,486 ) $ 8,636,794 (125 %)
Revenues
We generated revenues of $53,438 and $34,502 for the six ended June 30, 2022 and
2021, respectively. The Company's revenue derives from the development,
promotion and distribution of our live events, televised entertainment
programming and site subscription. The increase in revenues was attributed to an
increase in live event revenue.
Cost of Services
We incurred total cost of services of $14,957 and $26,032 for the six months
ended June 30, 2022 and 2021, respectively. The cost of services incurred
consist of labor, material, equipment and subcontractor expenses.
Operating Expenses
We incurred total operating expenses of $130,512 and $132,704 for the six months
ended June 30, 2022 and 2021, respectively. The decrease in operating expenses
was primarily due to the decrease in e-commerce and travel expense.
Other Income (Expenses)
We recognized total other income of $1,836,338 and incurred other expenses of
$6,768,252 for the six months ended June 30, 2022 and 2021, respectively. The
increase in other income was mainly attributed to an increase in gain on changes
in fair value of derivatives during the six months ended June 30, 2022.
Net Income (Loss)
We recognized net income of $1,744,308 and incurred net loss of $6,892,486
during the six months ended June 30, 2022 and 2021, respectively. The increase
in our net income was mainly attributed to an increase in gross profit, the
decrease in operating expense and the increase in other income during the six
months ended June 30, 2022.
Liquidity and Capital Resources
June 30, December 31, Changes
Working Capital Data: 2022 2021 Amount %
Current Assets $ 33,170 $ 41,981 $ (8,811 ) (21 %)
Current Liabilities $ 5,087,672 $ 6,840,790 (1,753,118 ) (26 %)
Working Capital Deficiency $ (5,054,502 ) $ (6,798,809 ) 1,744,307 (26 %)
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At June 30, 2022 we had a working capital deficiency of $5,054,502 and an
accumulated deficit of $9,976,835. The Company intends to fund future operations
through equity financing arrangements, which may be insufficient to fund its
capital expenditures, working capital and other cash requirements for the year
ending December 31, 2022.
The ability of the Company to realize its business plan is dependent upon, among
other things, obtaining additional financing to continue operations, and
development of its business plan. In response to these problems, management
intends to raise additional funds through public or private placement offerings.
These factors, among others, raise substantial doubt about the Company's ability
to continue as a going concern. The accompanying financial statements do not
include any adjustments that might result from the outcome of this uncertainty.
The following table sets forth certain information about our cash flow during
the six months ended June 30, 2022 and 2021:
Six Months Ended
June 30, Changes
Cash Flows Data: 2022 2021 Amount %
Cash Flows used in Operating %)
Activities $ (53,811 ) $ (139,593 ) $ 85,782 (61
Cash Flows provided by Financing ) %)
Activities 45,000 265,000 (220,000 (83
Net increase (decrease) in cash during ) %)
period $ (8,811 ) $ 125,407 $ (134,218 (107
Cash Flows from Operating Activities
We have not generated positive cash flows from operating activities.
During the six months ended June 30, 2022, net cash flows used in operating
activities was $53,811, consisting of a net income of $1,744,308, decreased by
gain on change in fair value of derivative liabilities of $2,017,446, increased
by amortization of debt discount of $78,170 and net changes in operating assets
and liabilities of $141,157.
During the six months ended June 30, 2021, net cash flows used in operating
activities was $139,593, consisting of a net loss of $6,892,486, decreased by
loss on change in fair value of derivative liabilities of $6,472,595,
amortization of debt discount of $224,201, note conversion fee of $500 and net
changes in operating assets and liabilities of $55,597.
Cash Flows from Investing Activities
There was no investing activities during the six months ended June 30, 2022 and
2021.
Cash Flows from Financing Activities
During the six months ended June 30, 2022, net cash provided by financing
activities was $45,000 through proceeds from issuance of a convertible note.
During the six months ended June 30, 2021, net cash provided by financing
activities was $265,000 through the proceeds from issuance of promissory notes.
Off-Balance Sheet Arrangements
As of June 30, 2022, we had no off-balance sheet arrangements.
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