Exhibit 99.2
WEBUY GLOBAL LTD AND SUBSIDIARIES
UNAUDITED INTERIM CONSOLIDATED BALANCE SHEETS
(Amounts expressed in US dollars (“$”) except for numbers of shares and par value)
| June 30, | December 31, | |||||||
| 2023 | 2022 | |||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable | ||||||||
| Inventories | ||||||||
| Prepaid expenses and other assets | ||||||||
| Amount due from a related party | ||||||||
| Total current assets | ||||||||
| Leasehold improvements and equipment, net | ||||||||
| Right of use assets – operating lease | ||||||||
| Intangible assets | ||||||||
| Total Assets | $ | $ | ||||||
| Liabilities and Shareholders’ (Deficit) Equity | ||||||||
| Current Liabilities | ||||||||
| Accounts payable | $ | $ | ||||||
| Deferred revenue | ||||||||
| Other current liabilities | ||||||||
| Amount due to a related party | ||||||||
| Loans payable – current | ||||||||
| Convertible notes payable | ||||||||
| Operating lease liability – current | ||||||||
| Total Current Liabilities | ||||||||
| Loans payable – non-current | ||||||||
| Operating lease liability – non-current | ||||||||
| Total Liabilities | $ | $ | ||||||
| Commitments and contingencies | ||||||||
| Shareholders’ (Deficit) Equity | ||||||||
| Ordinary stock ( | $ | $ | ||||||
| Additional paid-in capital | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Accumulated other comprehensive loss | ( | ) | ( | ) | ||||
| Total Shareholders’ Deficit to shareholders of Webuy Global Ltd | ( | ) | ( | ) | ||||
| Deficit attributable to non-controlling interests | ( | ) | ( | ) | ||||
| Total Shareholders’ Deficit | ( | ) | ( | ) | ||||
| Total Liabilities and Shareholders’ Deficit | $ | $ | ||||||
| * |
The accompanying notes are an integral part of these unaudited interim consolidated financial statements.
WEBUY GLOBAL LTD AND SUBSIDIARIES
UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Amounts expressed in US dollars (“$”) except for numbers of shares)
| Six Months Ended | ||||||||
| June 30, | ||||||||
| 2023 | 2022 | |||||||
| Revenues | $ | $ | ||||||
| Cost of revenues | ( | ) | ( | ) | ||||
| Gross profit | ||||||||
| Operating expenses | ||||||||
| Selling and distribution expenses | ( | ) | ( | ) | ||||
| General administrative expenses | ( | ) | ( | ) | ||||
| Share-based compensation | ( | ) | ||||||
| Total operating expenses | ( | ) | ( | ) | ||||
| Loss from operations | ( | ) | ( | ) | ||||
| Other (expense) income | ||||||||
| Other income | ||||||||
| Gain on disposal of a subsidiary | ||||||||
| Finance costs | ( | ) | ( | ) | ||||
| Total other (expense) income, net | ( | ) | ||||||
| Loss before income taxes | ( | ) | ( | ) | ||||
| Income taxes | ||||||||
| Net loss | ( | ) | ( | ) | ||||
| Less: Net loss attributable to non-controlling interests | ||||||||
| Net loss attributable to shareholders of Webuy Global Ltd | $ | ( | ) | $ | ( | ) | ||
| Net loss | ( | ) | ( | ) | ||||
| Foreign currency translation | ||||||||
| Comprehensive loss | ( | ) | ( | ) | ||||
| Less: Comprehensive loss attributable to non-controlling interests | ||||||||
| Comprehensive loss attributable to shareholders of Webuy Global Ltd | $ | ( | ) | $ | ( | ) | ||
| $ | ( | ) | $ | ( | )* | |||
| * | ||||||||
| * |
The accompanying notes are an integral part of these unaudited interim consolidated financial statements.
F-2
WEBUY GLOBAL LTD AND SUBSIDIARIES
UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (DEFICIT)
(Amounts expressed in US dollars (“$”) except for numbers of shares)
| Ordinary Shares | Accumulated | |||||||||||||||||||||||||||||||
| Number of Shares | Amount ($0.000000385 par) | Additional Paid-in Capital | Accumulated Deficit | Other Comprehensive (loss) Income | Deficit to Ordinary Shareholders | Non- controlling Interests | Total Deficit | |||||||||||||||||||||||||
| Balance as at December 31, 2021 | * | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||||||||||||
| Share-based compensation | - | |||||||||||||||||||||||||||||||
| Net loss | - | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||
| Foreign currency translation | - | |||||||||||||||||||||||||||||||
| Balance as at June 30, 2022 | * | $ | $ | $ | ( | ) | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||||||||||||
| Balance as at December 31, 2022 | $ | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||||||||||||||
| Net loss | - | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||
| Foreign currency translation | - | |||||||||||||||||||||||||||||||
| Balance as at June 30, 2023 | $ | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||||||||||||||
| * |
The accompanying notes are an integral part of these unaudited interim consolidated financial statements.
F-3
WEBUY GLOBAL LTD AND SUBSIDIARIES
UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts expressed in US dollars (“$”))
| Six Months Ended | ||||||||
| June 30, | ||||||||
| 2023 | 2022 | |||||||
| Cash Flows From Operating Activities: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Amortization of intangible assets | ||||||||
| Depreciation of leasehold improvements and equipment | ||||||||
| Gain on disposal of subsidiaries | ( | ) | ||||||
| Leasehold improvements and equipment written off | ||||||||
| Share-based compensation | ||||||||
| Non-cash lease costs | ||||||||
| Changes in operating assets and liabilities: | ||||||||
| Inventories | ||||||||
| Accounts receivable | ( | ) | ||||||
| Prepaid expenses and other assets | ( | ) | ( | ) | ||||
| Operating lease liability | ( | ) | ( | ) | ||||
| Accounts payable | ||||||||
| Deferred revenue | ( | ) | ||||||
| Other current liabilities | ||||||||
| Amount due from/to related parties | ( | ) | ||||||
| Net Cash used in Operating Activities | ( | ) | ( | ) | ||||
| Cash Flows From Investing Activities: | ||||||||
| Purchase of intangible assets | ( | ) | ||||||
| Purchase of leasehold improvements and equipment | ( | ) | ( | ) | ||||
| Net Cash used in Investing Activities | ( | ) | ( | ) | ||||
| Cash Flows From Financing Activities: | ||||||||
| Proceeds from issuance of convertible notes | ||||||||
| Proceeds from issuance of SAFE note | ||||||||
| Proceeds from term loan | ||||||||
| Repayment of loan payables | ( | ) | ( | ) | ||||
| Net Cash provided by Financing Activities | ||||||||
| Effect of Exchange Rate Changes on Cash | ( | ) | ||||||
| Net changes in cash | ( | ) | ||||||
| Cash at beginning of the period | ||||||||
| Cash at end of the period | $ | $ | ||||||
| Supplemental Disclosure of Cash Flow Information: | ||||||||
| Cash paid for interest | $ | $ | ||||||
| Cash paid for taxes | $ | $ | ||||||
The accompanying notes are an integral part of these unaudited interim consolidated financial statements.
F-4
WEBUY GLOBAL LTD AND SUBSIDIARIES
NOTES TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2023 AND 2022
(Amounts expressed in US dollars (“$”) except for numbers of shares)
Note 1. Organization, Description of Business and Going Concern
Webuy Global Ltd (“Webuy”) was incorporated on August 29, 2022 in the Cayman Islands as a company limited by shares.
Webuy Global Ltd and subsidiaries (“we”, “our”, “us” or collectively known as the “Company”) is an emerging Southeast Asian (“SEA”) community-oriented e-Commerce retailor (“Community E-Commerce Retailor”) with a focus on grocery and travel. Community e-commerce is a deepened extension form of e-commerce, where social media users with mutual interest and like-minded behavior are connected, forming a community group within a network through online medium. Our mission is to make social shopping a new lifestyle for consumers and to empower consumers’ purchases with an efficient cost-saving purchasing model.
Share Swap Agreement
On August 29, 2022, the Company closed a share
swap agreement (the “Share Swap”) between New Retail International Pte Ltd. (“New Retail”), which is a private
company with limited liability under Singapore law and its shareholders. Under the Share Swap, the Company acquired
Reorganization
The Share Swap between Webuy and New Retail is considered as a merger of entities under common control. Under the guidance in ASC 805, for transactions between entities under common control, the assets, liabilities and results of operations, are recognized at their carrying amounts on the date of the Share Swap, which required retrospective combination of Webuy and New Retail for all periods presented. The unaudited interim consolidated financial statements for the six months ended June 30, 2022 have been prepared as if the existing corporate structure had been in existence. This includes a retrospective presentation for all equity related disclosures, including issued shares and earnings per share, which have been revised to reflect the effects of the reorganization as of June 30, 2022.
Corporate Structure
| Name | Incorporation | Percentage | Place of Incorporation | Fiscal | Principal Activities | |||||||
| Webuy Global Ltd | ||||||||||||
| New Retail International Pte Ltd | % | |||||||||||
| PT Webuy Social Indonesia | % | |||||||||||
| The Shopaholic Bear Pte Ltd | % | |||||||||||
| Bear Bear Pte Ltd | % | |||||||||||
| Webuy Travel Pte. Ltd. | % | |||||||||||
| PT Buah Kita Retail | % | |||||||||||
| PT Webuy Travel Indonesia | % | |||||||||||
F-5
Going concern
These unaudited interim consolidated financial
statements have been prepared on a going concern basis, which assumes that the Company will be able to continue in operation for the foreseeable
future and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The Company
incurred net loss of $
In view of these circumstances, the management of the Company has given consideration to the future liquidity and performance of the Company and its available sources of finance in assessing whether the Company will have sufficient financial resources to continue as a going concern.
To sustain its ability to support the Company’s operating activities, the Company may have to consider its available sources of funds through the following sources:
| ● | Issuance
of additional convertible notes and equity to individual persons and/or corporate entities, from March 1, 2022 through the date of the
release of these financial statements, the Company has raised a total of $ |
| ● | Other available sources of financing from Singapore banks and other financial institutions; and |
| ● | Financial support from the Company’s related party and shareholders. |
| ● | On
October 19, 2023, the Company completed its initial public offering to receive $ |
No assurance can be provided that these additional financings will be available on acceptable terms or at all. If management is unable to execute this plan, there would likely be a material adverse effect on the Company’s business. The unaudited interim consolidated financial statements for the six months ended June 30, 2023 and 2022 have been prepared on a going concern basis and do not include any adjustments to reflect the possible future effects on the recoverability and classifications of assets or the amounts and classifications of liabilities that may result from the inability of the Company to continue as a going concern.
Note 2. Summary of Signification Accounting Policies
The accounting policies applied for the six months ended June 30, 2023 and 2022 are consistent with those of the audited consolidated financial statements for the years ended December 31, 2022 and, 2021, as described in those audited consolidated financial statements, except for the adoption of any new and amended accounting principles generally accepted in the United States of America (“US GAAP”) effective after the year ending December 31, 2022 which are relevant to the preparation of the June 30, 2023 unaudited interim consolidated financial statements.
Basis of presentation and consolidation
The accompanying unaudited interim consolidated financial statements have been prepared in accordance with Article 10 of Regulation S-X. These statements should be read in conjunction with the audited consolidated financial statements for the years ended December 31, 2022 and 2021, which have been prepared in accordance US GAAP. The unaudited interim consolidated financial statements have been prepared on a historical cost basis. In the opinion of management, all adjustments necessary for a fair presentation have been included in the accompanying unaudited interim consolidated financial statements. The results of operations for the six months ended June 30, 2023 are not necessarily indicative of the results that may be expected for the full year ended December 31, 2023.
The unaudited interim consolidated financial statements include the financial statements of the Company and all its majority-owned subsidiaries from the dates they were incorporated. All intercompany balances and transactions have been eliminated in consolidation.
All amounts are presented in United States dollars (“USD”) and have been rounded to the nearest USD.
F-6
Use of estimates
The preparation of the unaudited interim consolidated financial statements in conformity with US GAAP requires management of the Company to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates and judgments.
In preparing the interim condensed consolidated financial statements, the significant judgments made by management in applying the Company’s accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended December 31, 2022 and 2021.
Cash and cash equivalents
Cash is carried at cost and represents cash on hand and bank deposits. Cash equivalents consist of funds received from customers, which funds were held at the third-party platform’s fund account, and which are unrestricted and immediately available for withdrawal and use.
Periodically, the Company may carry cash balances
at financial institutions more than the respective subsidiaries’ government insured limits in Singapore and Indonesia ranging from
approximately $
Foreign currencies translation and transactions
The reporting currency of the Company is United States Dollar (“USD”) and the accompanying unaudited interim consolidated financial statements have been expressed in “$”. In addition, the Company’s subsidiaries are operating in Singapore, Malaysia, Indonesia and People Republic of China and maintains its books and records in its local currency, Singapore Dollar (“SGD”), Malaysia Ringgit (“MYR”), Indonesia Rupiah (“IDR”) and Chinese Yuan (“CNY”), respectively, which are the functional currency as being the primary currency of the economic environment in which their operations are conducted.
Accounts receivable
Accounts receivable are recorded in accordance with ASC 310, “Receivables.” Accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable and other receivables. The Company determines the allowance based on aging data, historical collection experience, customer specific facts and economic conditions. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company did not have any off-balance-sheet credit exposure relating to its customers, suppliers or others. For the six months ended June 30, 2023 and 2022, the Company did not record any allowances for doubtful accounts against its accounts receivable and other receivables nor did it charge off any such amounts, respectively.
Leases
A lease for which substantially all the benefits and risks incidental to ownership remain with the lessor is classified by the lessee as an operating lease. The Company records the lease expenses on a straight-line basis over the lease term.
The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, operating lease liabilities – current and operating lease liabilities – non-current on the balance sheets. Finance leases are included in leasehold improvements and equipment, loan payable – current and loan payable – non-current in the balance sheets.
F-7
Operating lease right-of-use (“ROU”) assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Generally, the implicit rate of interest (“discount rate”) in arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present value of lease payments. The Company’s incremental borrowing rate is a hypothetical rate based on its understanding of what its credit rating would be. The operating lease ROU asset includes any lease payments made and excludes lease incentives.
Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company accounts for the lease and non-lease components of its leases as a single lease component. Lease expense is recognized on a straight-line basis over the lease term.
Accounts payables and other current liabilities
Accounts payable and other current liabilities are liabilities for goods and services provided to the Company prior to the end of the financial year which are unpaid. They are recognized initially at their fair value and subsequently measured at amortized cost using the effective interest method. They are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities.
Convertible notes payable
Upon adoption of Accounting Standards Update (“ASU”) 2020-06 on January 1, 2022, the elimination of the beneficial conversion feature (“BCF”) and cash conversion models in ASC 470-20 that requires separate accounting for embedded conversion features in convertible instruments results in the convertible debt instruments being recorded as a single liability (i.e., there is no separation of the conversion feature, and all proceeds are allocated to the convertible debt instruments as a single unit of account). Unless conversion features are derivatives that must be bifurcated from the host contracts in accordance with ASC 815-15 or, in the case of convertible debt, if the instruments are issued with a substantial premium, in the latter case, ASC 470-20-25-13 requires the substantial premium to be attributable to the conversion feature and recorded in additional paid-in capital (APIC).
The Company accounted for these Notes as a single liability-classified instrument measured at amortized cost due to the adoption of ASU 2020-06. ASC Subtopic 470-20 “Debt—Debt with Conversion and Other Options” and ASC subtopic 815-40 “Hedging—Contracts in Entity’s Own Equity”. The Company has presented these Notes in current liabilities in the accompanying balance sheets. On November 27, 2023, these Note bearers signed another agreement with the Company to provide a waiver of the right of conversion of the Note into conversion shares (Note 10).
Revenue recognition
The Company adopts Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (ASC Topic 606) for all periods presented. The core principle underlying the revenue recognition of this ASU allows the Company to recognize revenue that represents the transfer of goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange. This will require the Company to identify contractual performance obligations and determine whether revenue should be recognized at a point in time or over time, based on when control of goods and services transfers to a customer.
To achieve that core principle, the Company applies five-step model to recognize revenue from customer contracts. The five-step model requires the Company to (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction price to the respective performance obligations in the contract, and (v) recognize revenue when (or as) the performance obligation is satisfied.
F-8
Product revenues
- Performance obligations satisfied at a point in time
The Company primarily sells goods through group orders directly through the Company’s mobile application. The Company accounts for the revenues generated from sales on a gross basis as the Company is acting as a principal in these transactions and is responsible for fulfilling the promise to provide the specified goods, which the Company has control of the goods and has the ability to direct the use of goods to obtain substantially all the benefits. Revenues are measured based on the amount of consideration that the Company expects to receive reduced by sales return and discount. In making this determination, the Company also assesses whether the Company is primarily obligated, subject to inventory risk, has latitude in establishing prices, or has met several but not all of these indicators in accordance with ASC 606-10-55-36 through 40. The Company recognizes the sales of goods when the control of the specified goods is transferred to customers which is upon delivery of goods to customers. Revenues also exclude any amounts collected on behalf of the third parties, including sales taxes and indirect taxes.
The Company sells goods to customers and the revenues are earned from the cash payment made by customers or customers settle their balances with “Assets”. The Company grants “Assets” upon (i) Cash collected from customers via Webuy mobile APP to top up their e-wallet balance; (ii) Refund to customers’ e-wallet due to order cancellation or products returned from customers; (iii) Commissions payable to Group Leaders for the provision of services to the Company. These “Assets” entitle the holders to offset future purchases. As such, “Assets” are initially recognized and recorded as “Advances from customers” upon the grant and when customers have yet placed the purchase orders to create an underlying sales agreement with the Company. The Company uses the term “Assets” to represent the payment procedures and balances of customers’ user accounts on the Company’s Webuy mobile APP platform.
Until “Assets” are used at the time when customers have placed the purchase orders, “Assets” of customers’ user accounts in the Company’s Webuy mobile APP will be reduced; as for the Company’s book-keeping, the Company reclassifies the “Advance from customers” balance to “Deferred revenue”. “Deferred revenue” is a contract liability that the Company is obligated to transfer goods to customers for which the Company has received consideration (or the amount is due) from customers in the form of cash or “Assets”. The balance of “Deferred revenue” represents unfulfilled performance obligations in the sales agreement, i.e. products that have not yet been delivered. Once the related products have been delivered, the amount in “Deferred revenue” account is shifted to a revenue account.
Deferred revenue recognized as revenue during
the six months ended June 30, 2023 and 2022 was $
Packaged-tour revenue
- Performance obligations satisfied at a point in time
Within each contract, the Company identify whether it is principal or agent at the performance obligation level. In arrangements where the Company has substantive control over the service before transferring it to the customer and is primarily responsible for integrating the services into the final deliverables, the Company acts as principal. The Company’s revenue on the sale of packaged-tour is reported as a gross basis, that is, the amounts billed to the customer are recorded as revenues, and amounts paid to travel supplier (such as airlines, hotels, travel buses, etc.) are recorded as cost of revenues. The Company is principal in accordance with ASC paragraphs 606-10-55-36 through 55-40 because the Company controls the packaged-tour including the underlying travel services before the services are transferred to the customer. The control is evidenced by the Company being primarily responsible to its customer and is having a level of discretion in establishing pricing.
The Company operates as a single operating segment
including product revenue from the sale of goods, which represent
F-9
| For the six months ended June 30, | ||||||||||||||||
| Product/Service Type | 2023 | Percentage of Total revenue | 2022 | Percentage of Total revenue | ||||||||||||
| Food and beverage | $ | % | $ | % | ||||||||||||
| Fresh produce | % | % | ||||||||||||||
| Lifestyle and other personal care items | % | % | ||||||||||||||
| Packaged-tour | % | % | ||||||||||||||
| Total | $ | % | $ | % | ||||||||||||
| For the six months ended June 30, | ||||||||||||||||
| Country | 2023 | Percentage of Total revenue | 2022 | Percentage of Total revenue | ||||||||||||
| Singapore | $ | % | $ | % | ||||||||||||
| Indonesia | % | % | ||||||||||||||
| Malaysia | - | % | % | |||||||||||||
| Total | $ | % | $ | % | ||||||||||||
During the years ended June 30, 2023 and 2022, all revenues were generated from third parties.
Cost of revenue
Costs are recognized when incurred. Cost of revenue consists of direct labor, materials, freight charges and other direct costs.
Recent Accounting Pronouncements
In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. This standard requires a financial asset (or group of financial assets) measured at amortized cost basis to be presented at the net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. This standard is effective for the Company on January 1, 2023.
All new standards and amendments that are effective for annual reporting period commencing January 1, 2023 have been applied by the Company for the six months ended June 30, 2023. The adoption of these new and amended standards did not have material impact on the unaudited interim consolidated financial statements of the Company. A number of new standards and amendments to standards have not come into effect for the year beginning January 1, 2023, and they have not been early adopted by the Company in preparing these unaudited interim consolidated financial statements. None of these new standards and amendments to standards is expected to have a significant effect on the unaudited interim consolidated financial statements of the Company.
Note 3. Prepaid expenses and other assets
| June 30, | December 31, | |||||||
| 2023 | 2022 | |||||||
| Prepayment | $ | $ | ||||||
| Advance to suppliers | ||||||||
| Deposits | ||||||||
| Other receivables | ||||||||
| $ | $ | |||||||
The prepayment includes payments of advertisement expenses, insurance premiums, rental expenses, travel package costs and professional fees. The deposits are mainly related to equipment, office and warehouse refundable security deposit and payment service provider rolling reserves. The other receivables are mainly related to advance to employees and non-trade receivables due from third parties.
F-10
Note 4. Leasehold improvements and Equipment
| June 30, | December 31, | |||||||
| 2023 | 2022 | |||||||
| Motor Vehicles | $ | $ | ||||||
| Office equipment | ||||||||
| Furniture and fittings | ||||||||
| Computer | ||||||||
| Warehouse equipment | ||||||||
| Leasehold improvements | ||||||||
| Accumulated depreciation | ( | ) | ( | ) | ||||
| Leasehold improvements and equipment, net of accumulated depreciation | $ | $ | ||||||
Depreciation expense of leasehold improvements
and equipment for the six months ended June 30, 2023 and 2022 were $
During the six months ended June 30, 2023 and
2022, the Company purchased assets of $
The motor vehicles with a net carrying amount
of $
Note 5. Right of use assets and operating lease liability
Operating lease
The Company has entered into commercial operating leases for the use
of offices and warehouses as lessee. These leases have varying terms, escalation clauses and renewal rights. On February 28, 2023, the
Company entered into a new lease agreement for a lease term of five years for a four-story office and warehouse facility in Singapore.
The Company is committed to pay a total rental fee of approximately $
| June 30, | December 31, | |||||||
| 2023 | 2022 | |||||||
| Leasehold buildings | $ | $ | ||||||
| Accumulated amortization | ( | ) | ( | ) | ||||
| ROU assets, net of accumulated amortization | $ | $ | ||||||
| June 30, | June 30, | |||||||
| 2023 | 2022 | |||||||
| Lease costs: | ||||||||
| Operating lease costs | $ | $ | ||||||
| Short-term lease costs | ||||||||
| Total lease costs | $ | $ | ||||||
| Supplemental cash flow information: | ||||||||
| Operating cash flows from operating leases | $ | $ | ||||||
| Right-of-use obtained in exchange for new operating lease liabilities | ( | ) | ( | ) | ||||
| Weighted-average remaining lease term (years): | ||||||||
| Operating leases | ||||||||
F-11
| Operating leases | ||||
| Periods Ended June 30, | ||||
| 2024 | $ | |||
| 2025 | ||||
| 2026 | ||||
| 2027 | ||||
| Thereafter | ||||
| Total operating lease payment | ||||
| Less: Imputed interest | ( | ) | ||
| Present value of operating lease liabilities | ||||
| Operating lease liabilities – current | $ | |||
| Operating lease liabilities – non-current | $ | |||
Note 6. Intangible assets
| June 30, | December 31, | |||||||
| 2023 | 2022 | |||||||
| Software | $ | $ | ||||||
| Application development | ||||||||
| Accumulated amortization | ( | ) | ( | ) | ||||
| Intangible assets, net of accumulated amortization | $ | $ | ||||||
| Amortization expense | ||||
| Periods Ended June 30, | ||||
| 2024 | $ | |||
| 2025 | ||||
| 2026 | ||||
| Total amortization expense | $ | |||
Amortization expense of intangible assets for
the six months ended June 30, 2023 and 2022 were $
During the six months ended June 30, 2023 and
2022, the Company acquired intangible assets of $ and $
F-12
Note 7. Other current liabilities
| June 30, | December 31, | |||||||
| 2023 | 2022 | |||||||
| Accrued expenses (a) | $ | $ | ||||||
| Advance from customers | ||||||||
| Other payables (b) | ||||||||
| $ | $ | |||||||
| (a) |
| (b) |
Note 8. Loans payable
| June 30, | December 31, | |||||||
| 2023 | 2022 | |||||||
| Hire purchases - Motor Vehicle | $ | $ | ||||||
| Term loan I | ||||||||
| Term loan II | ||||||||
| Short-term loan | ||||||||
| Less current portion | ( | ) | ( | ) | ||||
| Long-term loans payable | $ | $ | ||||||
On August 27, 2020, the Company acquired a motor vehicle pursuant to a hire purchase financing arrangement.
The Company has booked interest expense on the
loans of $
On September 23, 2021, the Company entered
into an unsecured term loan agreement (“Term loan I”) with a third party and obtained a loan facility in the amount of $
On January 6, 2022, the Company entered into an
unsecured term loan agreement (“Term loan II”) with a third party and obtained a loan facility in the amount of $
On December 12, 2022, the Company entered into a loan agreement (“Short-term
loan”) with a third party whereby the Company borrowed $
F-13
Hire Purchases
| Finance leases | ||||
| Periods Ended June 30, | ||||
| 2024 | $ | |||
| 2025 | ||||
| 2026 | ||||
| 2027 | ||||
| 2028 | ||||
| Thereafter | ||||
| $ | ||||
| Less: Imputed interest | ( | ) | ||
| Hire purchases liabilities | $ | |||
| Hire purchases liabilities – current | $ | |||
| Hire purchases liabilities – non-current | $ | |||
Note 9. Related Party Transactions
Amount due from a related party
As of June 30, 2023 and December 31, 2022, the
Company recorded amount due from GBuy Global Pte Ltd, a shareholder of the Company of $
As of June 30, 2023 and December 31, 2022, the
Company recorded amount due from Webuy Talent Ltd (“Webuy Talent”) of $
Amount due to a related party
| June 30, 2023 | June 30, 2022 | |||||||
| Beginning of the years January 1 | $ | $ | ||||||
| Advances for operation and administration expenses | ||||||||
| Payments made to a director | ( | ) | ||||||
| Exchange difference | ( | ) | ||||||
| Periods ended June 30 | $ | $ | ||||||
As of June 30, 2023 and December 31, 2022, the
Company recorded amount due to Mr. Bin Xue, Chief Executive Officer and Chairman of the Board of Director of the Company of $
Note 10. Convertible Notes Payables
During the year ended December 31, 2022, the Company
issued a series of Convertible Loan Note (“Note”) in aggregate principal amount of $
During the six months ended June 30, 2023, the
Company issued a series of Convertible Loan Note (“Note”) in aggregate principal amount of $
F-14
On August 2, 2023, the Company issued a Convertible
Loan Note in principal amount of $
These Notes will mature in 12 months to 18 months from the
funding date and bear interest at a rate of
Note 12. Equity
On May 2, 2023,
Authorized Shares
As of June 30, 2023, the Company has
Ordinary Shares
No shares were issued during the six months ended
June 30, 2023. As of June 30, 2023, the Company has
Note 13. Disposal of a subsidiary
On June 29, 2022, the Company completed the disposal
of its
Note 14. Income tax
Income tax expense comprises current and deferred taxes. Current taxes and deferred taxes are recognized in profit or loss except to the extent that it relates to a business combination, or items recognized directly in equity or in other comprehensive loss.
Enterprise income tax
Cayman Islands
The Company is incorporated in the Cayman Islands. Under the current laws of the Cayman Islands, the Company is not subject to income or capital gains taxes. In addition, dividend payments are not subject to withholdings tax in the Cayman Islands.
Singapore
Subsidiaries incorporated in Singapore are subject
to the Singapore corporate income tax rate of
Indonesia
Subsidiaries incorporated in Indonesia are subject
to Indonesia corporate income tax rate of
Malaysia
Subsidiaries incorporated in Malaysia are subject
to Malaysia corporate income tax rate of
F-15
China
Subsidiaries incorporated in China are subject
to the China corporate income tax rate of
Current taxes are the expected tax receivable or payable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax receivable or payable in respect of previous years. Deferred taxes are recognized in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
Deferred taxes are not recognized for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss, and differences relating to investments in subsidiaries and jointly controlled entities to the extent that it is probable that they will not reverse in the foreseeable future.
A deferred tax asset is recognized for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future taxable profits will be available against which they can be utilized. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realized.
The Company considers positive and negative evidence to determine whether some portion or all of the deferred tax assets will more likely than not be realized. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carry forward periods, the Company’s experience with tax attributes expiring unused and tax planning alternatives. Valuation allowances have been established for deferred tax assets based on a more-likely-than-not threshold. The Company’s ability to realize deferred tax assets depends on its ability to generate sufficient taxable income within the carry forward periods provided for in the tax law.
| June 30, | June 30, | |||||||
| 2023 | 2022 | |||||||
| Net loss before income taxes | $ | ( | ) | $ | ( | ) | ||
| Income tax expenses attributable to net income at Singapore statutory rate of | ( | ) | ( | ) | ||||
| Effect of different tax rates in other jurisdictions | ( | ) | ( | ) | ||||
| Non-deductible expenses | ||||||||
| Singapore tax exemption or non-taxable income | ( | ) | ||||||
| Unrecognized deferred tax asset | ||||||||
| Total tax provision | $ | $ | ||||||
| (*) |
| June 30, | December 31, | |||||||
| 2023 | 2022 | |||||||
| Tax loss carry forwards | $ | $ | ||||||
| Deferred tax assets | ||||||||
| Valuation allowance | ( | ) | ( | ) | ||||
| Total deferred tax assets, net | $ | $ | ||||||
According to Singapore Income Tax Act, due to
change of ownership in New Retail, the tax losses carry forwards of $
F-16
Note 15. Government Grants
During the six months ended June 30, 2023 and
2022, these government grants in aggregate amount of $
Note 16. Concentrations and Risks
Concentrations
Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of accounts receivable. The Company conducts credit evaluations of its customers, and generally does not require collateral or other security from them. The Company evaluates its collection experience and long outstanding balances to determine the need for an allowance for doubtful accounts. The Company conducts periodic reviews of the financial condition and payment practices of its customers to minimize collection risk on accounts receivable.
There was no single customer who represent
There was no single supplier who represent
| June 30, 2023 | %
| December 31, 2022 | %
| |||||||||||||
| Company A | $ | % | $ | % | ||||||||||||
F-17
| June 30, 2023 | % accounts receivable | December 31, 2022 | % accounts receivable | ||||||||||||||
| Company A | % | % | |||||||||||||||
| Company B | % | % | |||||||||||||||
| Company C | % | % | |||||||||||||||
| Company D | % | ||||||||||||||||
| Company E | % | $ | % | ||||||||||||||
| $ | % | $ | % | ||||||||||||||
Credit Risk
Credit risk is the potential financial loss to the Company resulting from the failure of a customer or a counterparty to settle its financial and contractual obligations to the Company, as and when they fall due. As the Company does not hold any collateral, the maximum exposure to credit risk is the carrying amounts of trade and other receivables (exclude prepayments) and cash and bank deposits presented on the consolidated balance sheets. The Company has no other financial assets which carry significant exposure to credit risk.
Foreign Currency Risk
The Company operates in multiple markets, which exposes it to the effects of fluctuations in currency exchange rates as it reports its financials and key operational metrics in USD. The Company earns revenue denominated in local currencies of Southeast Asia. The Company generally incur expenses for employee compensation and other operating expenses in the local currencies in the markets in which it operates. Fluctuations in the exchange rates among the various currencies that the Company uses could cause fluctuations in its operational and financial results.
Note 17. Commitments and Contingencies
In the normal course of business, we are subject to loss contingencies, such as legal proceedings and claims arising out of our business, that cover a wide range of matters, including, among others, government investigations and tax matters. In accordance with ASC No. 450-20, “Loss Contingencies”, we will record accruals for such loss contingencies when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. In the opinion of management of the Company, there were no pending or threatened claims and litigation as of June 30, 2023 and through the date of the release of these financial statements.
Note 18. Subsequent Events
The Company completed its initial public offering
of
On August 2, 2023, the Company entered into a
Convertible Loan Note amounting to $
On October 19, 2023, the Convertible Loan Note bearers signed the lock-up
agreements to agree that their Notes will be converted after 180 days from the date of closing of the Initial Public Offering (the “Lock-Up
Period”). The anticipated conversion date is
On November 3, 2023, the Representative exercised
the Over-Allotment Option partially to purchase an additional
On November 9, 2023, a third party issued an unsecured
promissory note to the Company, pursuant to which the Company lent a principal amount of $
The Company incorporated PT Buah Kita Retail and PT Webuy Travel Indonesia on October 23, 2023.
The Company evaluated all events or transactions that occurred subsequent to June 30, 2023, through the date of the release of these financial statements, apart from the subsequent events discussed above, management of the Company has determined that there are no subsequent events that require disclosure or recognition in the financial statements.
F-18