Tianci International Inc
For the period ended Apr 30, 2024. Filed Jun 14, 2024.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Apr 30, 2024 · Filed Jun 14, 2024
CIIT$2.40+54.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-01-31; filed 2024-02-27.
0001683168-24-001192
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-04-30; filed 2024-06-14.
0001683168-24-004218
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 44 previous paragraphs and 59 current paragraphs.
23 unchanged; 15 reworded; 21 added; 5 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (21)
Current report
On June 13, 2012, Freedom Petroleum Inc. was incorporated under the laws of the State of Nevada.
Current report
On July 02, 2015, Freedom Petroleum, Inc. changed its name from Freedom Petroleum to Steampunk Wizards, Inc.(“Steampunk”).
Current report
On October 26, 2016, Steampunk completed a reverse merger, with Steampunk as the public shell company. Tianci merged with and into Steampunk. This transaction was carried out in accordance with the terms set forth in the Merger Agreement which took effective On November 9, 2016, and on the same day, Steampunk changed its name to Tianci International, Inc.
Current report
On August 3, 2017, Tianci entered into a Stock Purchase Agreement (the “SPA”) with Shifang Wan (the “Seller”), the record holder of 4,397,837 common shares, or approximately 87.00% of the issued and outstanding of Common Stock of Tianci, and Chuah Su Chen and Chuah Su Mei (collectively, the “Purchasers”, and together with Tianci and the Seller, the “Parties”). Pursuant to the SPA, the Seller sold to the Purchasers and the Purchasers acquired from the Sellers the Shares for a total gross purchase price of Three Hundred Fifty Thousand Dollars ($350,000). The acquisition was consummated on August 15, 2017.
Current report
Our primary line of business is global logistics. The Company, through its subsidiary, Roshing, provides global logistics services, encompassing booking and the transportation arrangement and related logistics solutions. Roshing’s customized logistics solutions are tailored to meet the diverse needs of its customers.
Current report
As a global logistics enterprise, Roshing focuses on ocean freight forwarding services, including container shipping and bulk goods shipping service.
Current report
For the container shipping, Roshing charters cargo space from shipping suppliers (such as shipowners, non-vessel operating common carriers) and then sub-charters that space to its customers (cargo owners, cargo agents). For bulk goods shipping, Roshing issues fixture notes to customers and then arranges the booking of ships, signing of charter parties with suppliers (such as shipowners). Roshing tailors a selection of transport options and arranges to transport the goods from the port of loading to the port of destination, so as to complete the performance of the contract.
Current report
Roshing currently does not own or operate any transportation assets. By leveraging our senior management’s expertise in the global logistics industry and adopting an asset-light strategy at the early stage, Roshing has seen a significant growth in logistics revenue during the six months ended January 31, 2024. Shufang Gao, our Chief Executive Officer previously worked for a globally renowned shipping conglomerate, with over 20 years of management experience. His expertise spans shipping operation management, and logistics transportation. Leveraging this experience, he has provided the Company with the managerial framework to expand its global logistics business, as well as access to relevant customer and supplier resources in the shipping industry. Roshing’s business is primarily carried out in Hong Kong and other locations in the Asia-Pacific region, mainly in Japan, South Korea, Vietnam. Roshing’s logistics services also include the shipment of goods to African countries.
Current report
Roshing also generates revenue from the sale of electronic parts, and certain business and technical consulting services, independent from its global logistics business.
Current report
Key factors that affect operating results
Current report
Our performance of operations and financial conditions have been, and are expected to continue to be, affected by a number of factors which are set forth below.
Current report
Economic Conditions in Hong Kong
Current report
We are a Nevada company with operations conducted by our subsidiary Roshing, which is based in Hong Kong. Accordingly, if Hong Kong experiences any adverse economic, political or regulatory conditions due to events beyond our control, such as local economic downturn, natural disasters, contagious disease outbreaks, terrorist attacks, or if the government adopts regulations that place restrictions or burdens on us or on our industry in general, our business, financial condition, results of operations and prospects may be materially and adversely affected.
Current report
International Trade Environment
Current report
The demand for our shipping operation services is driven by the levels of international trade, which is in turn affected by global political, economic or social conditions. Any changes in a particular country’s trade policy could trigger retaliatory actions by affected countries, potentially eventually resulting in a trade war, which could increase the cost of goods and thus reduce customer demand for products if the parties have to pay tariffs which increase their prices or if trading partners limit their trade with the particular country. Our business is also susceptible to downturns and disruptions in the business activities of their direct customers that are beyond their control. If sales in a particular geographical market in which our direct customers target operate in decline, due to unstable regional and/or global political and economic conditions, such decline will likely lead to a corresponding plunge in the international trade volume which, in turn, could reduce the demand for freight forward and adversely affect our results of operations.
Current report
Our Ability to Source Cargo Space from Vendors on a Cost-Efficient Manner
Current report
A significant portion of our cost of revenue is the fee that we paid to our vendors. As a result, our results of operation depend on our ability to source vendors in a cost-efficient manner by obtaining a favorable price and effectively control the cost.
Current report
Comparison of the nine months ended April 30, 2024 and 2023
Current report
Net loss
Current report
Net cash of $121,476 provided by operating activities for the nine months ended April 30, 2024 was primarily the result of net income of $55,805, the decrease of the due from related party for the collection of the amount due, and $90,464 increase in accrued liabilities, which was offset by an increase of $82,021 of accounts receivable due to the increase of our new business line.
Current report
The Company realized $314,296 in net cash during the nine months ended April 30, 2023, primarily because it reduced its accounts receivable balance by $622,659. In addition, the net loss was in part attributable to $210,000 in stock compensation paid, which was a non-cash item. These cash sources were partially offset by the decrease of $301,282 in accounts payable as the Company used cash to pay its vendors.
Removed paragraphs (5)
Previous report
As a non-asset-based freight forwarder, we currently do not own or operate any transportation assets. In our role as an indirect carrier, we issue fixture notes to customers as the contract of carriage. In turn, when the freight is physically tendered to a direct carrier, we receive a contract of carriage known as a Master Ocean Bill of Lading (MOBL). By leveraging our senior management’s expertise on the global logistics industry and adopting an asset-light strategy at the early stage, we’ve seen a significant growth in logistics revenue during the six months ended January 31, 2024. Our business is primarily carried out in Hong Kong and other locations in the Asia-Pacific region.
Previous report
We are optimistic about the future of the logistics service industry. We expect that the global demand for coal, grains and iron ore, electric vehicles, and green energy equipment will continue to increase in response to changes in international trade flows and growing emerging market economies, as well as post pandemic stimulus policies in many countries, all of which should boost demand for global logistics services. Our vision is to continue exploring opportunities in the Asia-Pacific region, and other emerging markets to increase our customer base and global logistics service revenue.
Previous report
Net Income
Previous report
Net cash of $109,822 provided by operating activities for the six months ended January 31, 2024 was primarily the result of net income of $94,602. While an increase of $86,513 in accounts receivable during the period served to reduce the cash provided by our operations, we offset that item with a $89,040 increase in accrued liabilities..
Previous report
Net cash of $217,000 provided by operating activities for the six months ended January 31, 2023 was primarily the result of an decrease in accounts receivable of $540,914, which was partially offset by the decrease of $325,062 in accounts payable.
Reworded paragraphs (15)
Previous wording
During the three and six months ended January 31, 2024, our revenue increased significantly: to $2,894,128 for the three months ended January 31, 2024 from $98,730 for the three months ended January 31, 2023 and to $4,220,776 for the six months ended January 31, 2024 from $223,100 for the six months ended January 31, 2023. The increase was mainly attributable to the launch and growth of our global logistics service, which contributed 97% of our revenue in the quarter ended January 31, 2024 and 95% of our revenue during the six months ended January 31, 2024.
Current wording
During the three and nine months ended April 30, 2024, our revenue increased significantly: to $1,940,346 for the three months ended April 30, 2024 from $144,013 for the three months ended April 30, 2023 and to $6,161,122 for the nine months ended April 30, 2024 from $367,113 for the nine months ended April 30, 2023. The increase was mainly attributable to the launch and growth of our global logistics service, which contributed 99% of our revenue in the three months ended April 30, 2024 and 96% of our revenue during the nine months ended April 30, 2024.
Previous wording
Total cost of revenues increased from $78,800 to $2,555,024 for the three months ended January 31, 2024 and from $187,355 to $3,647,895 for the six months ended January 31, 2024. The increase was attributable to the growth of our global logistics services.
Current wording
Total cost of revenues increased from $260,700 to $1,695,639 for the three months ended April 30, 2024 and from $448,055 to $5,343,534 for the nine months ended April 30, 2024. The increase was attributable to the growth of our global logistics services.
Previous wording
Our cost of revenues from global logistics services represented 98% and 97% of total cost of revenues during the three and six months ended January 31, 2024, respectively. We did not have any cost of global logistics service in the same period in 2023 as this is a new service sector. Cost of global logistics services primarily include the cargo space charged by direct ocean carriers, freight forwarders and ancillary logistics services fees.
Current wording
Our cost of revenues from global logistics services represented 99% and 98% of total cost of revenues during the three and nine months ended April 30, 2024, respectively. We did not have any cost of global logistics service in the same period in 2023 as this is a new service sector. Cost of global logistics services primarily include the cargo space charged by direct ocean carriers, freight forwarders and ancillary logistics services fees.
Previous wording
Our cost of revenues from hardware product sales decreased by 44% and 37% for the three and six month periods ended January 31, 2024, respectively, reflecting the reduction in our revenue from hardware product sales.
Current wording
Our cost of revenues from hardware product sales decreased by 100% and 62% for the three and nine month periods ended April 30, 2024, respectively, reflecting the reduction in our revenue from hardware product sales.
Previous wording
Our gross profit increased by $319,174 to $339,104 for the three months and by $537,136 to $572,881 during the three and six months ended January 31, 2024, respectively. The increase in gross profit was primarily due to the launch and growth of our global logistics service, as discussed above. For the three and six months ended January 31, 2024, our overall gross profit margin was 11.7% and 13.6%, respectively, a reduction from gross margins of 20.2% and 16.0% during the three and six months ended January 31, 2023. Our overall gross margins fell because the gross margins from our global logistics service was 11.1% and 11.6% during the three and six months ended January 31, 2024. We anticipate that the gross margin realized from logistics services is likely to increase in the future as demand picks up post-pandemic with relatively stable global logistics supply.
Current wording
Our gross profit increased by $325,649 to $244,707 for the three months ended April 30, 2024 and by $898,530 to $817,588 for nine months ended April 30, 2024, respectively. The increase in gross profit was primarily due to the launch and growth of our global logistics service, as discussed above. For the three and nine months ended April 30, 2024, our overall gross profit margin was 12.6% and 13.3%, respectively, an increase from gross loss of 81% and 22% during the three and nine months ended April 30, 2023. Our overall gross margins increased because the gross margins from our global logistics service were 12.4% and 11.9% during the three and nine months ended April 30, 2024. The revenue contributed by the growth of our global logistics service was sufficient to cover the fixed cost of revenue, such as employee compensation, for the three months and nine months ended April 30, 2024, which revenue for the three months and nine months ended April 30, 2023 was insufficient to cover fixed costs, which resulted in a loss. We anticipate that the gross margin realized from logistics services is likely to increase in the future as demand picks up post-pandemic with relatively stable global logistics supply.
Previous wording
With the significant increase in our operations came a significant increase in our total operating expenses, which were $270,484 and $491,260 for the three and six months ended January 31, 2024, compared to $25,203 and $42,374 for the three and six months ended January 31, 2023, respectively. Our operating expenses primarily include payroll expenses, commissions, advertising, rent and professional fees relating to our obligations as a public company. The increase was mainly due to the increasing commission expense we paid to agents for referring global logistics customers, and professional fees for compliance services.
Current wording
With the significant increase in our operations came a significant increase in our total operating expenses, which were $226,423 and $717,683 for the three and nine months ended April 30, 2024, compared to $197,441 and $238,876 for the three and nine months ended April 30, 2023, respectively. Our operating expenses primarily include payroll expenses, commissions, advertising, rent and professional fees relating to our obligations as a public company. The increase was mainly due to the increasing commission expense we paid to agents for referring global logistics customers, and professional fees for compliance services.
Previous wording
Our income tax expense amounted to $7,141 and $11,972 for the three and six months ended January 31, 2024, compared to $0 and $(224) for the three and six months ended January 31, 2023, respectively. The change was due to the increase in revenue realized during the recent six month period.
Current wording
Our income tax expense amounted to $10,051 and $22,023 for the three and nine months ended April 30, 2024, compared to $1,280 and $2,219 for the three and nine months ended April 30, 2023, respectively. The change was due to the increase in revenue realized during the period.
Previous wording
The Company realized net income of $100,714 and $94,602 for the three months and six months ended January 31, 2024. However, since the Company owns only 90% of its operating subsidiary, Roshing, 10% of net income generated by Roshing was attributed to the minority interest. As a result, the net income for the three and six months ended January 31, 2024 attributable to the shareholders of Tianci International was $81,133 and $65,349, respectively. In comparison, during the three and six months ended January 31, 2023, the Company incurred net losses of $5,497 and $6,629 respectively. We believe our pivot to the logistics market gives our shareholders an opportunity to benefit from the opportunity presented by this market as the global economy recovers from the pandemic.
Current wording
The Company realized net loss of $(38,797) and net income $55,805 for the three months and nine months ended April 30, 2024. However, since the Company owns only 90% of its operating subsidiary, Roshing, 10% of net income generated by Roshing was attributed to the minority interest. As a result, the net income (loss) for the three and nine months ended April 30, 2024 attributable to the shareholders of Tianci International was $(49,974) and $15,375, respectively. In comparison, during the three and nine months ended April 30, 2023, the Company incurred net losses of $315,408 and $322,037 respectively. We believe our pivot to the logistics market gives our shareholders an opportunity to benefit from the opportunity presented by this market as the global economy recovers from the pandemic.
Previous wording
In assessing our liquidity, we monitor and analyze our cash on-hand and our operating expenditure commitments. Our liquidity needs are to meet our working capital requirements and operating expenses obligations. As of January 31, 2024, we had working capital of $692,636, as our cash amounted to $799,377, our current assets were $886,140 and our current liabilities were $193,504. To date, we have financed our operations primarily through capital contributions and advances from shareholders and by private placement of securities. At January 31, 2024 we owed $30,215 to related parties (See Note 3 to the financial statements).
Current wording
In assessing our liquidity, we monitor and analyze our cash on-hand and our operating expenditure commitments. Our liquidity needs are to meet our working capital requirements and operating expenses obligations. As of April 30, 2024, we had working capital of $733,839, as our cash amounted to $646,031, our current assets were $975,652 and our current liabilities were $241,813. To date, we have financed our operations primarily through capital contributions and advances from shareholders and by private placement of securities. At April 30, 2024 we owed $30,354 to related parties (See Note 4 to the financial statements).
Previous wording
The following table summarizes the key components of our cash flows for the six months ended January 31, 2024 and 2023.
Current wording
The following table summarizes the key components of our cash flows for the nine months ended April 30, 2024 and 2023.
Previous wording
The company has no investing activities during either of the six month periods ended January 31, 2024 and 2023.
Current wording
The company has no investing activities during either of the nine month periods ended April 30, 2024 and 2023.
Previous wording
Net cash provided by financing activities for the six months ended January 31, 2024 was $433,213. This was attributable to proceeds received from private offering of common stock in that amount.
Current wording
Net cash provided by financing activities for the nine months ended April 30, 2024 was $268,213. This was attributable to proceeds of $513,213 received from private offering of preferred stock which was offset by the $245,000 fees paid to various service vendors which was directly related to the proposed public offering of stock.
Previous wording
Net cash of $63,305 used in financing activities during the six months ended January 31, 2023 was primarily attributable to our repayment of a working capital loan of $296,884 during that period. Other than existing cash resources, the funds used to repay the loan were derived from a capital contribution received amounting to $65,650, collection of a subscription receivable amounting to $50,000, and a working capital advance from a related party amounting to $61,490. Our cash balance was also aided by reason of the direct payment of operating expenses by shareholders amounting to $47,360, and the payments of rent for our premises in Shenzhen China by related parties amounting to $9,079.
Current wording
Net cash used in financing activities during the nine months ended April 30, 2023 was of $72,463, which primarily attributable to our repayment of a working capital loan of $341,885 during that period. Other than existing cash resources, the funds used to repay the loan were derived from a capital contribution received amounting to $65,650, collection of a subscription receivable amounting to $50,000, and a working capital advance from a related party amounting to $61,490. Our cash balance was aided by reason of the direct payment of operating expenses by shareholders amounting to $73,369, and the payments of rent for our premises in Shenzhen China by related parties amounting to $14,727.
Previous wording
In connection with the preparation of our financial statements for the three and six months ended January 31, 2024, there was no accounting estimate we made that was subject to a high degree of uncertainty and was critical to our results.
Current wording
In connection with the preparation of our financial statements for the three and nine months ended April 30, 2024, there was no accounting estimate we made that was subject to a high degree of uncertainty and was critical to our results.
Previous wording
The Company considers the applicability and impact of all accounting standards updates (“ASUs”). Management periodically reviews new accounting standards that are issued. The Company does not believe that any recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated balance sheets, statements of operations and comprehensive income and statements of cash flows.
Current wording
The Company considers the applicability and impact of all accounting standards updates (“ASUs”). Management periodically reviews new accounting standards that are issued. The Company does not believe that any recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company’s consolidated balance sheets,
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Comparison of the six months ended January 31, 2024 and 2023