Huayue Electronics, Inc.

CIK:0001315756|SEC Filings

Consolidated Statements of Operations and Comprehensive Income - USD ($)	3 Months Ended		9 Months Ended
	Feb. 29, 2016	Feb. 28, 2015	Feb. 29, 2016	Feb. 28, 2015
Revenue	$ 312,163	$ 0	$ 313,803	$ 0
Cost of revenue	244,509	0	245,793	0
Gross profit	67,654	0	68,010	0
Operating expenses:
Salaries and other compensation	315,092	0	725,092	0
Professional fees	757,162	0	1,254,458	0
Depreciation and amortization	40,482	0	40,482	0
General and administrative	129,318	0	166,617	0
Total operating expenses	1,242,054	0	2,186,649	0
Loss from operations	(1,174,400)	0	(2,118,639)	0
Other income (expenses):
Gain on change in fair value of derivative liability	49	0	49	0
Interest expense	(11,497)	0	(12,130)	0
Amortization of debt discount and deferred financing costs	(196,178)	0	(282,155)	0
Loss before income taxes	(1,382,026)	0	(2,412,875)	0
Income tax provision	0	0	0	0
Net loss from continuing operations	(1,382,026)	0	(2,412,875)	0
Net income from discontinued operations, net of taxes (Note 4)	0	1,296,819	0	1,637,840
Net (loss) income	(1,382,026)	1,296,819	(2,412,875)	1,637,840
Foreign currency translation loss	0	(304,594)	0	(67,784)
Net comprehensive (loss) income	$ (1,382,026)	$ 992,225	$ (2,412,875)	$ 1,570,056
Basic and diluted (loss) from continuing operations	$ (0.05)	$ 0	$ (0.09)	$ 0
Basic and diluted income from discontinued operations	0	0.04	0	0.05
Basic and diluted (loss) income per share	$ (0.05)	$ 0.04	$ (0.09)	$ 0.05
Weighted average number of common shares	27,339,865	31,325,241	25,795,593	31,325,241

Consolidated Statements of Cash Flows - USD ($)	9 Months Ended
Consolidated Statements of Cash Flows - USD ($)	Feb. 29, 2016	Feb. 28, 2015
Cash flows from operating activities:
Net (loss) income	$ (2,412,875)	$ 1,637,840
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
Net (income) from discontinued operations	0	(1,637,840)
Depreciation and amortization	40,482	0
Gain on change in fair value of derivative liability	(49)	0
Amortization of debt discount and deferred financing costs	282,155	0
Shares issued to employees, consultants and board of directors	1,005,400	0
Options issued to employees	54,058	0
Services received in exchange for issuance of note payables	80,000	0
Changes in operating assets and liabilities:
Accounts receivable	(34,518)	0
Other receivable	(15,000)
Accounts payable and accrued expenses	388,947	0
Net cash used in operating activities - continuing operations	(611,399)	0
Net cash used in operating activities - discontinued operations	0	(1,758,715)
Net cash used in operating activities	(611,399)	(1,758,715)
Cash flows from investing activities:
Net cash used in investing activities - continuing operations	0	0
Discontinued operations cash sold in sale of subsidiary	(48,161)	0
Net cash used in investing activities	(48,161)	0
Cash flows from financing activities:
Proceeds from convertible promissory note agreements	456,750
Deferred financing costs paid in connection with convertible note	(81,700)
Repayments of convertible notes	(50,000)
Proceeds from promissory note agreements	218,000	0
Due to shareholder	84,545	0
Net cash provided by financing activities - continuing operations	627,595	0
Net cash used in financing activities - discontinued operations	0	1,496,441
Net cash provided by financing activities	627,595	1,496,441
Effect of exchange rate on cash and cash equivalents - discontinued operations	0	(24,289)
Net decrease in cash and cash equivalents	(31,965)	(286,563)
Cash at beginning of period - discontinued operations	48,161	344,636
Less: Cash at end of period - discontinued operations	0	(58,073)
Cash at end of period - continuing operations	16,196	0
Supplemental schedule of non-cash investing and financing activities:
Sale of discontinued entity	598,573	0
Common shares issued with promissory notes and recorded as debt discounts	96,037	0
Convertible promissory note issued in connection with asset purchase agreement	450,000	0
Accrued debt issuance costs	5,000,000	0
Supplemental cash flow disclosure:
Income tax paid	0	0
Interest paid	$ 4,598	$ 6,949

Consolidated Balance Sheets - USD ($)	Feb. 29, 2016	May. 31, 2015
Current Assets:
Cash and cash equivalents	$ 16,196	$ 0
Accounts receivable	34,519	0
Assets from discontinued operations (Note 4)	0	8,703,090
Total Current Assets	50,715	8,703,090
Computer software and equipment	931,081	0
Goodwill	928,437	0
Other receivable	15,000
Assets from discontinued operations (Note 4)	0	4,161,668
Total Assets	1,925,233	12,864,758
Current Liabilities:
Accounts payable and accrued expenses	409,969	48,750
Accrued debt issuance costs, net	98,583	0
Due to shareholder	84,545	0
Notes payable, net	295,730	0
Convertible notes payable, net	833,774	0
Derivative liability	45,262	0
Liabilities from discontinued operations (Note 4)	0	11,928,595
Total Current Liabilities	1,767,863	11,977,345
Liabilities from discontinued operations (Note 4)	0	337,590
Total Liabilities	1,767,863	12,314,935
Stockholders' Equity:
Preferred stock, $0.001 par value, 10,000,000 shares authorized; 9,500,000 and 0 shares designated as Series A at February 29, 2016 (unaudited) and May 31, 2015, respectively	0	0
Common stock, $0.001 par value, 150,000,000 shares authorized; 28,921,403 and 34,325,241 shares issued and outstanding at February 29, 2016 (unaudited) and May 31, 2015, respectively	28,921	34,325
Additional paid-in capital	8,892,182	6,866,355
Accumulated deficit	(8,763,733)	(6,350,857)
Total Stockholders' Equity	157,370	549,823
Total Liabilities and Stockholders' Equity	$ 1,925,233	$ 12,864,758