Japan Food Tech Holdings, Inc. (formerly Dr. Foods, Inc.) reported significant financial developments for the three months ended June 30, 2024, reflecting a notable increase in revenue but continued net losses. Total revenues surged to $5.5 million, up from $616, driven primarily by increased sales of plant-based food products through its subsidiary, Dr. Foods Co., Ltd. The gross profit for the same period was also reported at $5.5 million, compared to $616 in the prior year.

Despite the revenue growth, the company recorded a net loss of $81,311 for the quarter, compared to a loss of $68,362 in the same period of 2023. This increase in net loss was attributed to higher general and administrative expenses. The basic and diluted loss per share was $(0.02), compared to $(0.01) in the previous year.

The company’s financial position showed total current assets decreasing to $17,324 as of June 30, 2024, from $21,606 as of March 31, 2024. Current liabilities slightly decreased to $49,347, down from $50,019. A significant increase in accounts payable was noted, rising from $1,017 to $14,668. Stockholders’ equity reflected a deficit, worsening from $(28,413) to $(32,023).

Cash flow analysis indicated net cash used in operating activities increased to $(75,921) from $(18,330) year-over-year, while net cash provided by financing activities decreased to $76,251 from $209,546. The ending cash balance as of June 30, 2024, was $8,116, a significant drop from $82,295 a year earlier.

Strategically, the company has been focusing on the development of plant-based food products, including "Dr. Foie Gras," which has seen limited sales due to marketing challenges. A proposed acquisition of Mama Foods Co., Ltd. for $500,000 and shares of preferred stock was not completed due to the lack of required audited financials, and the acquisition is now considered highly improbable.

The company has also faced challenges regarding its ability to continue as a going concern, citing negative cash flows, minimal revenues, and recurring net losses. Management plans to fund operating expenses through related party contributions, although there is no assurance of success. Additionally, the company reported material weaknesses in its internal controls, particularly in accounting and financial reporting functions.