TEMIR CORP. MANAGEMENT REPORT AND ANALYSIS OF FINANCIAL POSITION AND OPERATING RESULTS (Form 10-Q)

Insight



TEMIR CORP. ("Temir" or the "Company") is a corporation established under the
corporation laws in the State of Nevada on May 19, 2016. The Company commenced
operations in tourism. Temir Corp. was a travel agency that organized individual
and group tours in Kyrgyzstan, such as cultural, recreational, sport, business,
ecotours and other travel tours.



On July 15, 2019, the Company's principal office relocated to Room 1204-06,
12/F, 69 Jervois Street, Sheung Wan, Hong Kong. On January 15, 2020, the
Company's principal office has been relocated to Suite 1802-03, 18/F, Strand 50,
50 Bonham Strand, Sheung Wan, Hong Kong. The management of Temir Corp is
planning to restructure the Company's business from travel agency to a Fintech
company with major business focusing on financials services and using the
internet, mobile devices, software technology or cloud services to perform or
connect with financial services.



JTI Group


On April 2, 2020the Company has entered into a sale and purchase agreement (the “Agreement”) as buyer, by and between the Company, JTI Financial Services Group Limited (“JTI”), a hong kong company, and Ace Vantage Investments Limited (also owned by Mr. Roy Kong Hoi Chan (an executive director and president of the Company, “Mr. Roy Chan” and his father) as a seller (the “Seller”).



Under the terms and conditions of the Agreement (and supplemented by the
Amendment, the Second Amendment and the Third Amendment), the Company offered,
sold and will issue 4,118,182 shares of common stock in consideration for all
the issued and outstanding shares in JTI. The effect of the issuance is that the
Vendor now hold approximately 61.54% of the issued and outstanding shares of
common stock of the Company.



Mr. Roy Chan, the founder of JTI, and Chairman of the board of directors is the
holder of 629,350 shares of common stock of the Company prior to the
Transaction. The Company's officers and directors, Mr. Roy Chan, Mr. Mark Yip
and Mr. Brian Wong therefore, control an aggregate of 4,993,412 or 74.62% of the
outstanding common stock of the Company, on a fully diluted basis, after the
Transaction.


Following the Agreement, JTI is now a wholly owned subsidiary of the Company.

The transaction with JTI was treated as a reverse acquisition, with JTI as the
acquirer and the Company as the acquired party.  As a result of the controlling
financial interest of the former stockholders of JTI, for financial statement
reporting purposes, the merger between the Company and JTI was treated as a
reverse acquisition, with JTI deemed the accounting acquirer and the Company
deemed the accounting acquiree under the acquisition method of accounting in
accordance with the Section 805-10-55 of the FASB Accounting Standards
Codification. The reverse acquisition is deemed a capital transaction in
substance whereas the assets and liabilities of JTI. (the accounting acquirer)
are carried forward to the Company (the legal acquirer and the reporting entity)
at their carrying value before the combination and the equity structure (the
number and type of equity interests issued) of JTI is being retroactively
restated using the exchange ratio established in the Share Purchase Agreement to
reflect the number of shares of the Company issued to effect the acquisition.
The number of common shares issued and outstanding and the amount recognized as
issued equity interests in the consolidated financial statements is determined
by adding the number of common shares deemed issued and the issued equity
interests of JTI immediately prior to the business combination to the unredeemed
shares and the fair value of the Company determined in accordance with the
guidance in ASC Section 805-40-55 applicable to business combinations, i.e. the
equity structure (the number and type of equity interests issued) in the
consolidated financial statements immediately post combination reflects the
equity structure of the Company, including the equity interests the legal
acquirer issued to effect the combination.



JTI has four wholly owned operating subsidiaries, namely, JTI Finance Limited
("JF"), Concept We Mortgage Broker Limited ("CW"), JTI Property Agency Limited
("JP") and JTI Asset Management Limited ("JA"). On May 17 2021, the Company
incorporated Temir Logistics Industrial Park Limited, which is incorporated in
Hong Kong and principally engaged in investment holding. The principal
activities of JTI are provision of diversified financial services through its
wholly owned subsidiaries incorporated in Hong Kong.



                                       18




JF is a licensed money lender in Hong Kong, holding a money lender license no.
1662/2021 granted by the licensing court of Hong Kong. JF offers various types
of loans including but not limited to personal loan, business loan, credit card
consolidation loan and equity pledge loan to its customers in Hong Kong.



CW is one of the active mortgage brokers in Hong Kong. Its revenue is mainly
derived from the referral fee from the banks and financial institutions for
the
mortgage referral.



JP is a licensed property agent in Hong Kong, holding an estate agent's license
granted by Estate Agents Authority of Hong Kong. Its revenue is mainly derived
from the commission provided by the landlord for facilitating the sales or
lease
of commercial properties.


JA is a consulting services company. After completion of the agreement, JA plans to apply for fund management licenses in hong kong or in another jurisdiction, aiming to provide fund management services on a global basis.

Transaction concerning Bac Giang International Logistics Co., Ltd.



On May 20, 2021, the Company, Hainan Qicheng Asset Management Joint Stock
Company ("Hainan") and Temir Logistics entered into a sale and purchase
agreement ("SPA"), pursuant to which the Company shall issue 930,233 shares of
the Company at a price of $21.5 per share, valued at $20,000,000 in exchange of
10% shareholding in Bac Giang International Logistics Co., Ltd. Bac Giang is a
company incorporated in the Socialist Republic of Vietnam, the principal
business of which is to build and run a modern international logistics park in
Bac Giang Province, Vietnam. 930,233 shares of the Company were issued to the
nominee of Hainan on June 8, 2021. Based on the SPA, 930,233 shares were issued
within one month from the signing date of SPA. The transfer of shares of Bac
Giang will be completed within 3 years from the date of SPA.



Temir Logistics is a wholly owned subsidiary of the Company, which is
incorporated in Hong Kong on May 17, 2021, principally engaged in investment
holding. It was intended to invest in Bac Giang International Logistics Co.,
Ltd.


On August 25, 2021, the Company, Hainan and Temir Logistics entered into a SPA
Termination agreement (the "Termination Agreement") to terminate all of the
rights and obligation of the SPA entered on May 20, 2021 and to cancel the
930,233 shares issued to the nominee. 930,233 shares were cancelled on September
16, 2021.



Transaction re eDDA platform


On May 5, 2021, (i) Direct Assistance Limited, a wholly owned subsidiary of EFT
Solutions Holdings Limited (a company listed on GEM of The Stock Exchange of
Hong Kong Limited), (ii) 2Go Investments Group Limited and (iii) JTI formed eDDA
Solutions Limited ("eDDA"), a company incorporated in Hong Kong with limited
liability, which will be principally engaged in the business of sales and
maintenance services for the electronic direct debit authorization ("eDDA
platform"). JTI has contributed share capital of $1 (HK$10), representing a 10%
shareholding of eDDA. eDDA has not commenced operations as of the date of
approval of this report.



Impact of COVID-19



The spread of the coronavirus ("COVID-19") around the world has caused
significant business disruption in year 2020 and 2021. In March 2020, the World
Health Organization declared the outbreak of COVID-19 as a global pandemic,
which continues to spread around the world. Our business continues to be
impacted by the COVID-19 pandemic. Significant COVID-19 related restrictions,
including those in response to the outbreak of the Delta variant and the Omicron
variant, have continued and in some instances, have been significantly
tightened, in markets in which we operate. There is significant uncertainty
around the breadth and duration of business disruptions related to COVID-19, as
well as its impact on the Hong Kong's and global economy. While it is difficult
to estimate the financial impact of COVID-19 on the Company's operations,
management believes that COVID-19 could have a material impact on its financial
results in years 2021 and 2022.



                                       19





RESULTS OF OPERATIONS


The accompanying interim condensed financial statements have been prepared using
the going concern basis of accounting, which contemplates the realization of
assets and the satisfaction of liabilities in the normal course of business.



As of May 31, 2022, we have suffered recurring losses from operations, and
record an accumulated deficit and a working capital deficit of $1,118,226 and
$666,945, respectively. These conditions raise substantial doubt about our
ability to continue as a going concern. The continuation of our company as a
going concern is dependent upon improving our profitability and the continuing
financial support from our shareholders or other debt or capital sources.
Management believes the existing shareholders or external financing will provide
the additional cash to meet our obligations as they become due.



No assurance can be given that any future financing, if needed, will be
available or, if available, that it will be on terms that are satisfactory to
us. Even if we are able to obtain additional financing, if needed, it may
contain undue restrictions on our operations, in the case of debt financing, or
cause substantial dilution for our stock holders, in the case of equity
financing.



In March 2020, the World Health Organization declared the outbreak of COVID-19
as a global pandemic, which continues to spread around the world. There is
significant uncertainty around the breadth and duration of business disruptions
related to COVID-19 (including the new variants of the virus, such as the Delta
and Omicron variants), the travel or quarantine policies implemented, as well as
its impact on the Hong Kong's and global economy. While it is difficult to
estimate the financial impact of COVID-19 on our operations, management believes
that COVID-19 could have a material impact on our financial results at this
time.



Our condensed interim consolidated financial statements do not include any adjustments to reflect possible future effects on the recoverability and classification of assets and liabilities that could prevent our company from continuing as a going concern.


Results of operations


The following table shows the key elements of our operating results for the nine months ended May 31, 2022 and 2021:


                                          Nine months ended
                                               May 31
                                         2022           2021

REVENUE                               $  206,723     $  120,260

Cost of revenue                         (195,904 )     (113,867 )

GROSS PROFIT                              10,819          6,393

General and administrative expenses (171,971) (146,669)

LOSS FROM OPERATIONS                    (161,152 )     (140,276 )

Other income                               5,256            965

Loss before income tax                  (155,896 )     (139,311 )

Income tax expense                             -              -

NET LOSS                              $ (155,896 )   $ (139,311 )




                                       20





Revenue and cost of revenue


During the nine months ended May 31, 2022, the Company generated revenue of
$206,723 compared to $120,260 for the nine months ended May 31, 2021,
representing a significant increase of approximately 71.90%. Cost of revenue was
$195,904 for the nine months ended May 31, 2022 compared to $113,867 for the
nine months ended May 31, 2021, representing a significant increase of
approximately 72.05%. The revenue generated and cost of revenue were derived
from our mortgage referral fee for both years. The significant increase of
income and cost of revenue benefit from the increasing demand of mortgage.

General and administrative expenses



During the nine months period ended May 31, 2022, we incurred $171,971 general
and administrative expenses compared to $146,669 during the nine months ended
May 31, 2021, representing an increase of approximately 17.25%. General and
administrative expenses incurred generally related to corporate overhead,
financial and administrative contracted services, such as legal and accounting
costs.



Net loss



As a result of the cumulative effect of the factors described above, our net
loss for the nine months period ended May 31, 2022 was $155,896 compared to net
loss of $139,311 during the nine months ended May 31, 2021.



The following table shows the key elements of our operating results for the three months ended May 31, 2022 and 2021:


                                        Three months ended
                                              May 31
                                        2022          2021

REVENUE                               $  85,610     $  36,476

Cost of revenue                         (81,950 )     (33,113 )

GROSS PROFIT                              3,660         3,363

General and administrative expenses (51,928 ) (44,110 )

LOSS FROM OPERATIONS                    (48,268 )     (40,747 )

Other income                                128             -

Loss before income tax                  (48,140 )     (40,747 )

Income tax credit                             -           402

NET LOSS                              $ (48,140 )   $ (40,345 )




Revenue and cost of revenue



During the three months ended May 31, 2022, the Company generated revenue of
$85,610 compared to $36,476 for the three months ended May 31, 2021. Cost of
revenue was $81,950 for the three months ended May 31, 2022 compared to $33,113
for the three months ended May 31, 2021. The revenue generated and cost of
revenue were derived from our mortgage referral fee for both years. The increase
of income and cost of revenue benefit from the increasing demand of mortgage.



                                       21




General and administrative expenses



During the three months period ended May 31, 2022, we incurred $51,928 general
and administrative expenses compared to $44,110 during the three months ended
May 31, 2021. General and administrative expenses incurred generally related to
corporate overhead, financial and administrative contracted services, such as
legal and accounting costs. The increase of general and administrative expenses
was due to an increase in professional fees.



Net loss



As a result of the cumulative effect of the factors described above, our net
loss for the three months period ended May 31, 2022 was $48,140 compared to net
loss of $40,345 during the three months ended May 31, 2021.



CASH AND CAPITAL RESOURCES


Working Capital



                              May 31,        August 31,
                               2022             2021
Cash and cash equivalents   $    13,867     $      9,727
Total current assets             57,583           51,908
Total assets                     57,584           51,909
Total liabilities               724,528          562,957
Accumulated deficit           1,118,226          962,330
Total deficit                   666,945          511,048



The following table provides detailed information about our free cash flow for all financial statement periods presented in this report:


                                                   Nine months ended
                                                        May 31,
                                                   2022         2021

Net cash used in operating activities            $ (2,920 )   $ (58,250 )
Net cash from investing activities                      -             -
Net cash provided by financing activities           7,060        60,381

Net increase in cash and cash equivalents           4,140         2,131

Cash and cash equivalents, beginning of period 9,727 2,580 CASH AND CASH EQUIVALENTS, END OF PERIOD $13,867 $4,711

Cash flow from operating activities



For the nine months period ended May 31, 2022, net cash flows used in operating
activities were $2,920, primarily resulted from net loss of $155,896 with a
decrease of accounts payable of $10,105 and an increase of accounts receivable
of $1,535 offset by an increase of rental and expenses payable to a related
company of $164,616. For the nine months period ended May 31, 2021, net cash
flows used in operating activities were $58,250, primarily resulted from the net
loss of $139,311 partially offset by the rental and expenses payable to a
related company of $80,868.



Cash flow from financing activities



Cash flows generated from financing activities during the nine months period
ended May 31, 2022 was $7,060, consisting of advances from a shareholder of
$19,845, advances from a related company of $8,077 and repayment to a related
company of $20,862. Cash flows generated from financing activities during the
nine months period ended May 31, 2021 was $60,381, consisting of advances from a
shareholder of $298,638, repayment to a shareholder of $232,103 and repayment to
a related company of $6,154.



                                       22




ADDITIONAL CAPITAL REQUIREMENT

We are looking to grow our business in the future. We intend to acquire other companies. We have targeted and located certain companies that we believe are suitable and likely to create synergy through acquisitions.

We anticipate that additional funding, if required, will be in the form of
equity financing from the sale of shares of our common stock. However, we cannot
provide investors with any assurance that we will be able to raise sufficient
funding from the sale of shares to fund additional expenditures. We do not
currently have any arrangements in place for any future equity financing. Our
limited operating history and our lack of significant tangible capital assets
makes it unlikely that we will be able to obtain significant debt financing in
the near future. If such financing is not available on satisfactory terms, we
may be unable to continue or expand our business. Equity financing could result
in additional dilution to existing shareholders.



OFF-BALANCE SHEET ARRANGEMENTS



As of the date of this Quarterly Report, we do not have any off-balance sheet
arrangements that have or are reasonably likely to have a current or future
effect on our financial condition, changes in financial condition, revenues or
expenses, results of operations, liquidity, capital expenditures or capital
resources that are material to investors.



CONTRACTUAL OBLIGATIONS



We had the following contractual obligations and commercial commitments as of
May 31, 2022:



                                                          Payment Due by Period
                                                Less than                                     More than
                                    Total         1 Year       1-3 Years      3-5 Years        5 Years
Amount due to a shareholder       $ 335,965     $  335,965     $        -     $        -     $         -
Amount due to a related company     315,819        315,819              -  
           -               -
Lease                                18,000         18,000              -              -               -
Total                             $ 669,784     $  669,784     $        -     $        -     $         -




We believe that our current cash and financing from our existing stockholders
are adequate to support operations for at least the next 12 months. We may,
however, in the future, require additional cash resources due to changed
business conditions, implementation of our strategy to expand our business or
other investments or acquisitions we may decide to pursue. If our own financial
resources are insufficient to satisfy our capital requirements, we may seek to
sell additional equity or debt securities or obtain additional credit
facilities. The sale of additional equity securities could result in dilution to
our stockholders. The incurrence of indebtedness would result in increased debt
service obligations and could require us to agree to operating and financial
covenants that would restrict our operations. Financing may not be available in
amounts or on terms acceptable to us, if at all. Any failure by us to raise
additional funds on terms favorable to us, or at all, could limit our ability to
expand our business operations and could harm our overall business prospects.

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