MBK Public : Report on the results of the exercise of MBK-W1, MBK-W2 and MBK-W3 (F53-5)

Special Note Regarding Forward-Looking Statements

The Private Securities Litigation Reform Act of 1995 (the “Act”) provides a safe haven for forward-looking statements made by or on behalf of our company. Our company and our representatives may, from time to time, make written or oral statements that are “forward-looking,” including statements contained in this annual report and other filings with the Securities and Exchange Commission and reports to our company’s stockholders. Management believes that all statements that express expectations and projections regarding future matters and developments outside of our Company’s control, including changes in global economic conditions, are forward-looking statements within the meaning of the law. These statements are based on management’s views and assumptions at the time the statements are made about future events and business developments. However, there can be no assurance that management’s expectations will necessarily be met. Factors that may affect forward-looking statements include a variety of factors that could materially affect future developments and performance, including the following:

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changes in company-wide strategies, which may result in changes in the type or mix of companies in which our company is involved or seeks to invest;

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changes in US, global or regional economic conditions;

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changes in US and global financial and stock markets, including significant fluctuations in interest rates, which may make it difficult for our company to access, or increase the cost of, external financing for our operations and investments;

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Increased competitive pressure at home and abroad;

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Legal and regulatory developments, such as B. Regulatory actions affecting environmental activities;

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The imposition of trade restrictions by foreign countries and changes in international tax laws or exchange controls;

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Adverse weather conditions or natural disasters such as hurricanes and earthquakes, labor disputes that may result in increased costs or business disruption.

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This list of factors that may affect future performance and the accuracy of forward-looking statements is illustrative but not exhaustive. Accordingly, all forward-looking statements should be evaluated with an understanding of the inherent uncertainty.

Critical Accounting Policies and Estimates

The preparation of the financial statements and related disclosures in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the unaudited financial statements and accompanying notes. Management bases its estimates on historical experience and various other assumptions that it believes are reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. The Company is of the opinion that during the three months ended March 31, 2022 there were no other significant changes to the items disclosed as significant accounting policies in management’s notes to the financial statements on the Company’s Form 10 for the year ended December 31, 2021 year are indicated.

Operation plan and business growth

Our efforts remain focused on increasing sales of our life science supplies while working to improve the design of our liquid nitrogen refrigeration products. Of these liquid nitrogen refrigeration products, the ultra-low freezer takes top priority. We have had positive feedback on the improvements and enhancements made to the ULT freezer design. We are also continuing to work on the refrigerated trailer or “reefer”.

We’re getting a lot of interest in our latest launch, an ultra-cold cooler used in the production of CBD oil. This unit improves the efficiency of the manufacturing process and allows for a higher purity of the CBD oil produced.

Simultaneously with the development and commercialization of the above products, we have completed our online catalog and are making progress in registering new distributors for our consumables.

The following is an analysis of results of operations for the three months ended March 31, 2022 and 2021.

operating results

Three months ended March 31, 2022 and 2021

For the three months ended March 31, 2022 2021 Change Revenue $753,576 $562,362 $191,214 Cost of Goods Sold 234,289 143,795 90,494 Gross Profit 519,287 418,567 100,720. ————————————————– —————————–

Revenue increased to $753,576 for the three month period ended March 31, 2022 from $562,362 for the three month period ended March 31, 2021, an increase of $191,214. The increase in sales is primarily due to a $167,865 increase in sales of freezers and refrigerators. Cost of goods increased to $234,289 for the quarter ended March 31, 2022 compared to March 31, 2021 from $143,795, an increase of $90,494. We achieved a gross profit percentage of 69% for the three months ended March 31, 2022 compared to 74% for the three months ended March 31, 2021. Gross profit percentage is dependent on the mix of product sales, which varies from quarter to quarter quarter. Increased sales of freezers and refrigerators in 2022 were slightly offset by higher costs, resulting in slightly lower margins. We continue to actively work to obtain more favorable prices from our suppliers in order to increase the achieved margins for all product lines.

Operating expenses for the three months ended March 31, 2022 were $312,782, an increase of $30,718 over expenses of $282,064 incurred for the three months ended March 31, 2021. The increase resulted from a $33,675 increase in salaries and wages, as we hired additional staff to meet demand for freezers and refrigerators, and a $16,628 increase in research and development expenses, partially offset by a $19,585 reduction in general and administrative expenses. While we continue to monitor and minimize operational costs, we also recognize that certain expenses are required to commercialize the products and achieve market penetration.

Research and development expenses for the three months ended March 31, 2022 were $25,325, an increase of $16,628 in expenses for the same period in 2021 as improvements continue to be made to the Ultra Cold CBD Oil Cooler.

Salaries and wages for the three months ended March 31, 2022 were $170,279, an increase of $33,675 compared to expenses for the three months ended March 31, 2021. Additional personnel were hired to allow the Company to meet sales demand after our refrigerators and freezers.

General and administrative expenses for the three months ended March 31, 2022 were $117,178, a decrease of $19,585 from $136,763 for the same period in 2021.

The lower spending level was not the result of significant savings in any one spending category, but rather is the cumulative result of small savings across multiple spends.

Net income for the three months ended March 31, 2022 was $206,506, a decrease of $41,263 from net income of $282,064 for the three months ended March 31, 2021. Management continues to look for opportunities to increase sales to improve gross margins and control of ongoing operating costs.

Net income of $206,506 for the three months ended March 31, 2022 represents earnings per share of $0.00. This compares to net income of $282,064 or $0.00 per share for the three months ended March 31, 2021.

seasonality and cyclicality

We don’t believe our business is cyclical.

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liquidity and capital resources

Our cash position at March 31, 2022 was $1,579,533 with accounts receivable of $233,329, net of allowance, and inventories of $695,607, net of allowance. Our working capital as of March 31, 2022 was $2,281,502. Working capital as of December 31, 2021 was $2,063,516.

For the three months ended March 31, 2022, net cash provided by operations was $105,609, a decrease of $158,664 from the $264,273 in net cash provided by operations for the three months ended March 31, 2021 .

Off-Balance Sheet Arrangements

none.

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