Tianci International Inc

Previous wording

RQS United is a holding company incorporated in the Republic of Seychelles. RQS United has no operations other than holding 90% of the outstanding share capital of its subsidiary, Roshing International Co., Ltd., a company organized under the laws of Hong Kong (“Roshing”). Roshing was incorporated on June 22, 2011 and is primarily engaged in logistics solutions, including sea freight forwarding, and logistic software development and maintenance. We also generate revenue from the sale of electronic parts, and certain technical consulting services.

Current wording

RQS United is a holding company incorporated in the Republic of Seychelles. RQS United has no operations other than holding 90% of the outstanding share capital of its subsidiary, Roshing International Co., Limited, a company organized under the laws of Hong Kong (“Roshing”). Roshing was incorporated on June 22, 2011 and is primarily engaged in logistics solutions, including shipping operation management. We also generate a small portion of our revenue from our non-core businesses that we carry on through Roshing, including software development services, consulting services, and the sale of electronic parts.

Previous wording

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 wording

For the container shipping service, Roshing charters cargo space from shipping suppliers (such as shipowners, ship carrier or non-vessel operating common carriers) and then sub-charters that space to its customers (cargo owners or cargo agents). For the bulk goods shipping service, Roshing issues fixture notes to customers, and then arranges the booking of ships, and signs chartering contracts with suppliers (such as shipowners). Roshing also tailors the 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.

Previous wording

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 wording

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 year ended July 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.

Previous wording

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 wording

Economic Conditions in Hong Kong. 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.

Previous wording

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 wording

International Trade Environment. 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.

Previous wording

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 wording

Our Ability to Source Cargo Space from Vendors on a Cost-Efficient Manner. 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.

Previous 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.

Current wording

For the three months ended October 31, 2024 and 2023

Previous 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.

Current wording

Total cost of revenues increased from $1,092,871 to $2,752,509 for the three months ended October 31, 2024. The increase was in line with the growth of our global logistics services.

Previous 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.

Current wording

Our cost of revenues from global logistics services represented 94% of total cost of revenues for the three months ended October 31, 2024. Cost of global logistics services primarily includes the cargo space charged by direct ocean carriers, fees charged by freight forwarders, fees charged for ancillary logistics services, and compensation we paid to our logistics employees.

Previous 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.

Current wording

As our business grew, there was a significant increase in our total operating expenses, which were $345,581 for the three months ended October 31, 2024 as compared to $220,776 for the three months ended October 31, 2023. Our operating expenses primarily include payroll expenses, commissions, marketing, rent and professional fees relating to our obligations as a public company. The increase was mainly due to the increase in general and administrative expenses from $118,705 for the three months ended October 31, 2023 to $260,363 for the three months ended October 31, 2024, partially offset by a $16,883 decrease in selling and marketing expenses in the same period. The increase in general and administrative expenses was attributable to increasing payroll expenses necessitated by the expansion of our logistics operations, as well as expenses incurred in anticipation of a securities offering as we prepare the Company to list on Nasdaq. The decrease in selling expenses during this period is attributable to decreasing commission expenses that we paid to third-parties as we became less dependent on brokers for new businesses.

Previous 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.

Current wording

Our income tax expense amounted to $2,189 for the three months ended October 31, 2024 as compared to $19,113 for the three months ended October 31, 2023. The change was due to the decrease in operating income generated by Roshing during this period.

Previous 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.

Current wording

As a result of the foregoing, we incurred a net loss of $91,948 for the three months ended October 31, 2024. As the Company owns only 90% shares of its operating subsidiary, Roshing, 10% of the net income realized by Roshing was attributed to the minority interest. Therefore, the net loss for the three months ended October 31, 2024 attributable to the shareholders of the Company was $93,056. In comparison, during the three months ended October 31, 2023, the Company incurred a net loss of $6,112.

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 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).

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 October 31, 2024, we had working capital of $696,406, as our cash amounted to $323,793, our current assets were $894,314 and our current liabilities were $197,908. To date, we have financed our operations primarily through capital contributions and advances from shareholders, as well as private investors. At October 31, 2024 we owed $2,271 to our related parties (See Note 4 to the financial statements).

Previous wording

We started providing shipping & freight forwarding services during the quarter ended October 31, 2023. Although the business grew quickly during its first six months, it may occur that to continue to take advantage of the opportunity offered by this business, we may require significant capital expenditure for developing our position in the market. If we determine that our cash requirements exceed the amount of cash and cash equivalents we have on hand at the time, we may seek to issue equity or debt securities or obtain credit facilities. The issuance and sale of additional equity may result in dilution to our shareholders. The incurrence of indebtedness would result in increased fixed obligations and could result in operating covenants that would restrict our operations. Our obligation to bear credit risk for certain financing transactions we facilitate may also strain our operating cash flow. We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all.

Current wording

We started providing logistics services during the quarter ended October 31, 2023. Although the business grew rapidly during the fiscal year ended July 31, 2024, we may require significant capital expenditure in order to obtain additional market share. If we determine that our cash requirements exceed the amount of cash and cash equivalents we have on hand at the time, we may seek to issue equity or debt securities or obtain credit facilities. The issuance and sale of additional equity may result in dilution to our shareholders. The incurrence of indebtedness would result in increased fixed obligations and could result in operating covenants that would restrict our operations. Our obligation to bear credit risk for certain financing transactions we facilitate may also strain our operating cash flow. We cannot assure you that financing will be in place or on terms acceptable to us, if at all.

Previous wording

The following table summarizes the key components of our cash flows for the nine months ended April 30, 2024 and 2023.

Current wording

The following table summarizes the key components of our cash flows for the three months ended October 31, 2024 and 2023.

Previous wording

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 wording

Net cash of $124,524 provided by operating activities for the three months ended October 31, 2023 was primarily the result of an increase in accounts payable of $195,232 and an increase in accrued liabilities and other payables of $140,354 which was partially offset by the increase of $ 195,629 in accounts receivable.

Previous wording

The company has no investing activities during either of the nine month periods ended April 30, 2024 and 2023.

Current wording

The company had no investing activities during the three months ended October 31, 2024 and 2023.

Previous 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.

Current wording

In connection with the preparation of our financial statements for the three months ended October 31, 2024, there was one accounting estimate we made that was subject to a high degree of uncertainty and was critical to our results. This was the accrual as “deferred offering costs” of amounts we have paid to professionals and others for services rendered and to be rendered in connection with a public offering of the Company’s securities. We will realize the value of these assets (and offset them against proceeds of the offering) only if the offering is placed successfully. We have accrued the payments as assets because we anticipate a successful offering. If, however, the offering fails to close, we will be required to amortize the asset as an expense.