Fuss Brands Corp. (formerly China Botanic Pharmaceutical Inc.) reported significant financial developments in its 10-Q filing for the period ending July 31, 2024. The company’s total assets increased to $236.7 million from $139.4 million as of October 31, 2023. However, total liabilities also rose sharply to $895.1 million from $588.0 million, resulting in a total stockholders’ deficit of $(658.4 thousand), up from $(448.6 thousand) in the previous fiscal period.
The company experienced a substantial increase in administrative expenses, which totaled $2.7 million for the nine months ended July 31, 2024, compared to $361.8 thousand for the same period in 2023. This rise in expenses contributed to a net loss of $(2.7 million) for the nine months, compared to a loss of $(362.7 thousand) in the prior year. The loss from operations for the same period was $(2.7 million), a significant increase from $(361.8 thousand) in the previous year.
Despite these losses, Fuss Brands reported a decrease in operating expenses for the three months ended July 31, 2024, which were $45.1 thousand, down from $115.0 thousand in the same quarter of 2023. The income (loss) before provision for income taxes also improved slightly, with a loss of $(46.4 thousand) compared to $(115.8 thousand) in the prior year.
The company has not generated any revenue to date but is in the process of fulfilling a purchase order from a luggage retailer valued at $925.0 thousand, marking its exit from shell status. As of July 31, 2024, Fuss Brands had deferred revenue of $176.7 thousand, consistent with the previous period.
Fuss Brands has faced challenges in funding, relying on related party loans, which increased to $483.7 thousand from $98.4 thousand as of October 31, 2023. The company received $385.3 thousand in financing from its new CEO, Cheskel Meisels, during the nine months ended July 31, 2024.
Strategically, the company appointed a new CEO on March 20, 2024, and dismissed its independent auditor on May 9, 2024, amid concerns about its ability to continue as a going concern due to significant operating losses. Management is exploring business opportunities, including potential acquisitions, but acknowledges that limited capital resources may restrict its options.
Fuss Brands continues to face operational and financial challenges, including a negative working capital of $(658.4 thousand) and an accumulated deficit of $(15.4 million) as of July 31, 2024. The company is actively seeking alternative financing sources to support its operations and growth initiatives.
About Fuss Brands Corp.
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