The following discussion of our financial condition and results of operations
should be read in conjunction with our financial statements and the related
notes, and other financial information included in this Form 10-Q.
Our Management's Discussion and Analysis contains not only statements that are
historical facts, but also statements that are forward-looking. Forward-looking
statements are, by their very nature, uncertain and risky. These risks and
uncertainties include international, national, and local general economic and
market conditions; our ability to sustain, manage, or forecast growth; our
ability to successfully make and integrate acquisitions; new product development
and introduction; existing government regulations and changes in, or the failure
to comply with, government regulations; adverse publicity; competition; the loss
of significant customers or suppliers; fluctuations and difficulty in
forecasting operating results; change in business strategy or development plans;
business disruptions; the ability to attract and retain qualified personnel; the
ability to protect technology; the risk of foreign currency exchange rate; and
other risks that might be detailed from time to time in our filings with the
Securities and Exchange Commission.
Although the forward-looking statements in this Report reflect the good faith
judgment of our management, such statements can only be based on facts and
factors currently known by them. Consequently, and because forward-looking
statements are inherently subject to risks and uncertainties, the actual results
and outcomes may differ materially from the results and outcomes discussed in
the forward-looking statements. You are urged to carefully review and consider
the various disclosures made by us in this report as we attempt to advise
interested parties of the risks and factors that may affect our business,
financial condition, and results of operations and prospects.
Overview
Rayont, Inc. (formerly Velt International Group Inc., or "Rayont" or the
"Company") is a Nevada corporation formed on February 7, 2011. The Company's
common stock are currently traded on the Over the Counter Pink Sheet under the
symbol "RAYT".
On November 19, 2018, the Company's former principal shareholder, Mr. Chin Kha
Foo, entered into a stock purchase agreement to transfer 60% of the Company's
issued and outstanding shares to Rural Asset Management Services, Inc., a
Malaysian company ("Rural"). On December 14, 2018, Rural became the principal
shareholder of the Company and Mr. Ali Kasa was appointed to be the Company's
President, CEO, CFO, and Secretary due to the change in control of the Company.
Rural is an equity investment company with portfolio of interest in
biotechnology, healthcare, cancer treatment research and technology, ICT and
Crypto Currency. Rural has invested to companies located in Malaysia, Australia
and the USA.
On January 22, 2019, the Company entered into an acquisition agreement with THF
Holdings Pty Ltd., an Australian corporation ("THF") and Rural, pursuant to
which the Company acquired 100% of the issued and outstanding capital stock of
THF in exchange for 4,000,000 shares of the Company's common stock, valued on
January 22, 2019 at $1,000,000. THF is an Australian Cancer treatment and
medical device company. Rural is the majority shareholder of THF. In March 2019,
the acquisition of THF was completed and THF became a subsidiary of the Company.
In addition, the acquisition was accounted for business combination under common
control of Rural.
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On January 24, 2019, the Company entered into an acquisition agreement with THF
International (Hong Kong) Ltd., a Hong Kong company ("THF Hong Kong") and the
shareholders of THF Hong Kong, pursuant to which the Company acquired 100% of
the issued and outstanding capital stock of THF Hong Kong in exchange for
8,000,000 shares of the Company's common stock, valued at $2,000,000 on January
24, 2019. On May 13, 2019, the Company executed an amendment to the acquisition
agreement, wherein the Company agreed to acquire only 85% of THF Hong Kong and
reduce the purchase price to 6,800,000 shares from 8,000,000 shares. On August
4, 2019, the Company and the THF Hong Kong agreed to terminate the acquisition.
On January 24, 2019, the Company entered into an acquisition agreement with
Natural Health Farm (Labuan) Inc. ("NHF") and the shareholders of NHF, pursuant
to which the Company acquired 100% of the issued and outstanding capital stock
of NHF in exchange for 40,000,000 shares of the Company's common stock, valued
at $10,000,000 on January 24, 2019. NHF is a Malaysian company concentrating on
clinical life sciences and holds an exclusive license for registering and
commercializing Photosoft technology for treatment of all cancers in the
Sub-Sahara African region. The technology has been licensed in Australia, New
Zealand, China, Malaysia and Sub-Sahara Africa. The human clinical trial efforts
have started in Australia and China conducted by Hudson Medical Institute,
Australia. On August 4, 2019, the Company and NHF agreed to terminate the
acquisition.
Since then the Company has undertaken a number of research activities to
identify the current state of cancer treatments in Sub-Sahara Africa, approval
process for cancer treatment technologies by the respective medical boards of
various countries and cancer treatment technologies for acquisitions.
The Company has identified suitable sites to establish the pilot treatment
center in South Africa to utilize the current medical equipment it owns. The
Company has not made any financial commitments as of now to rent and equip
suitable sites.
Current Operational Activities
With acquisition of THF Holdings Pty Ltd, the Company has decided to embark in
life science as a sector to operate and cancer treatment as an area that it will
develop its expertise and business. Prior to the change in the control, the
Company was to focus on the development and designs of a mobile application for
a third-party company in Hong Kong.
Results of Operations
For the six months ended March 31, 2020 and 2019
Revenue
The Company did not generate any revenue for the six months ended March 31, 2020
and 2019 and continues to look for other business opportunities.
Cost of Goods Sold
There was nil cost of goods sold incurred for the six months ended March 31,
2020 and 2019 due to no material business operations during the periods.
Operating Expense
Our expenses mainly consist of professional service expenses, depreciation
expense and bad debt expense. For the six months ended March 31, 2020 and 2019,
there was a total of $288,857 and $726,885 operating expenses, respectively.
Decreases in the operating expense were primarily resulted from that the
share-based compensation of $631,000 granted to the Company's officer and
consultants during the six-months ended March 31, 2019.
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Net Loss
We incurred net loss of $288,391 and $726,810 for the six months ended March 31,
2020 and 2019, respectively.
For the three months ended March 31, 2020 and 2018
Revenue
The Company did not generate any revenue for the three months ended March 31,
2020 and 2019 and continues to look for other business opportunities.
Cost of Goods Sold
There was nil cost of goods sold incurred for the three months ended March 31,
2020 and 2019 due to no material business operations during the periods.
Operating Expense
Our expenses primarily consist of professional service expenses and depreciation
expense. For the three months ended March 31, 2020 and 2019, there was a total
of $51,133 and $718,380 operating expenses, respectively. Decreases in the
operating expense were primarily resulted from that the share-based compensation
of $631,000 granted to the Company's officer and consultants during the
three-months ended March 31, 2019.
Net Loss
We incurred net loss of $47,461 and $717,555 for the three months ended March
31, 2020 and 2019, respectively.
Taxation
The Company recorded no income tax expense during the six and three months ended
March 31, 2020 and 2019 since the Company incurred net operating losses and
recorded a full valuation allowance against net deferred tax assets for all
periods presented.
Equity and Capital Resources
We continued incurring losses for the six months ended March 31, 2020 and had an
accumulated deficit of $2,794,819 as of March 31, 2020. During the six months
ended March 31, 2020, we had negative cash flows from operating activities of
$56,292, compared to negative cash flows from operating activities of $106,085
for the six months ended March 31, 2019.
We had no material commitments for capital expenditures as of March 31, 2020. We
expect our expenses will continue to increase during the foreseeable future as a
result of increased operational expenses and the development of potential
business opportunities. However, we do not anticipate that the Company will
generate revenue sufficient to cover its planned operating expenses in the
foreseeable future, and we are dependent on the proceeds from future debt or
equity investments to sustain our operations and implement our business plan. If
we are unable to raise sufficient capital, we will be required to delay or
forego some portion of our business plan, which would have a material adversely
effect on our anticipated results from operations and financial condition. There
is no assurance that we will be able to obtain necessary amounts of additional
capital or that our estimates of our capital requirements will prove to be
accurate. As of the date of this Report, we did not have any commitments from
any source to provide such additional capital. Even if we are able to secure
outside financing, it may not be available in the amounts or the times when we
require. Furthermore, such financing would likely take the form of bank loans,
private placement of debt or equity securities or some combination of these. The
issuance of additional equity securities would dilute the stock ownership of
current investors while incurring loans, leases or debt would increase our
capital requirements and possible loss of valuable assets if such obligations
were not repaid in accordance with their terms.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that we are required to
disclose pursuant to these regulations.
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VELT INTERNATIONAL GROUP INC 
