UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: March 31, 2024

 

  Or

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

 

 

For the transition period from: _____________ to _____________

 

ADVANCED OXYGEN TECHNOLOGIES, INC.

(Exact name of registrant as specified in its charter)

 

Delaware

 

0-9951

 

91-1143622

(State or Other Jurisdiction

 

(Commission

 

(I.R.S. Employer

of Incorporation)

 

File Number)

 

Identification No.)

 

C/O Crossfield, Inc., 653 VT Route 12A, PO Box 189, Randolph, VT 05060

(Address of Principal Executive Offices) (Zip Code)

 

(212)727-7085

(Registrant’s telephone number, including area code)

 

Title of Class

 

Trading Symbol

 

Name of each exchange on which registered

Common Stock, $0.01 Par Value

 

AOXY

 

OTC: PINK

 

Securities registered under Section 12(g) of the Exchange Act: Common Stock, par value $0.01 per share

 

Indicate by check mark if the registrant is not required to file reports pursuant to section 13 or Section 15(d) of the Act. Yes ☐      No ☒

 

Indicate by check whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒     No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒     No ☐

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of “large accelerated filer”, “an accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large Accelerated Filer

Accelerated Filer

Non-Accelerated Filer

Smaller Reporting Company

Emerging Growth Company

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act. Yes      No ☒

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the last practicable date: As of May 10, 2024, there were 3,292,945 issued and outstanding shares of the registrant’s Common Stock, $0.01 par value.

 

 

 

 

ADVANCED OXYGEN TECHNOLOGIES, INC.

 

Table of Contents

 

 

INDEX

 

Page

 

PART I

 

 

 

 

 

Item I:

Financial Statements (unaudited)

 

3

 

 

Condensed Consolidated Balance Sheets as of March 31, 2024 (unaudited) and June 30, 2023

 

3

 

 

Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the three and nine months ended March 31, 2024 and March 31, 2023 (unaudited)

 

4

 

 

Condensed Consolidated Statements of Stockholders’ Equity for the three and nine months ended March 31, 2024 and March 31, 2023 (unaudited)

 

5

 

Condensed Consolidated Statements of Cash Flows for the nine months ended March31, 2024 and March 31, 2023 (unaudited)

 

7

 

 

Notes to the Condensed Consolidated Financial Statements

 

8

 

 

 

 

 

 

Item 2:

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

20

 

Item 3:

Quantitative and Qualitative Disclosures about Market Risk

 

21

 

Item 4:

Controls and Procedures

 

21

 

 

 

 

 

 

PART II

 

 

 

 

 

 

 

Item 1:

Legal Proceedings

 

22

 

Item 2:

Unregistered Sales of Equity Securities and Use of Proceeds

 

22

 

Item 3:

Defaults Upon Senior Securities

 

22

 

Item 4:

Mine Safety Disclosures

 

22

 

Item 5:

Other Information

 

22

 

Item 6.

Exhibits and Reports on Form 8-K

 

23

 

Signature

 

24

 

 

 

 

 

EXHIBIT 31.1, 31.2 Certifications of Officers

EX 31

 

EXHIBIT 32.1, 32.2 Certifications of Officers

EX 32

 

EXHIBIT 101.INS Inline XBRL Instance

EX 101.INS

 

EXHIBIT 101.SCH Inline XBRL Taxonomy Extension Schema Document

EX 101.SCH

 

EXHIBIT 101.CAL Inline XBRL Taxonomy Extension Calculation Document

EX 101.CAL

 

EXHIBIT 101.DEF Inline XBRL Taxonomy Extension Definition Document

EX 101.DEF

 

EXHIBIT 101.LAB Inline XBRL Taxonomy Extension Labels Document

EX 101.LAB

 

EXHIBIT 101.PRE Inline XBRL Taxonomy Extension Presentation Document

EX 101.PRE

 

 

 
2

Table of Contents

 

PART 1: FINANCIAL INFORMATION

 

ITEM I: CONDENSED CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE AND NINE MONTHS ENDING MARCH 31, 2024 (unaudited).

 

ADVANCED OXYGEN TECHNOLOGIES, INC. 

AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

March 31,

2024

 

 

June 30,

2023

 

ASSETS

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

 

Cash

 

$105,239

 

 

$104,836

 

Property tax receivable

 

 

1,152

 

 

 

1,166

 

Total Current Assets

 

 

106,391

 

 

 

106,002

 

 

 

 

 

 

 

 

 

 

Property and equipment

 

 

584,151

 

 

 

591,705

 

TOTAL ASSETS

 

$690,542

 

 

$697,707

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

 

Accounts payable

 

 

775

 

 

 

-

 

Contract liabilities

 

 

3,020

 

 

 

3,059

 

Taxes payable

 

 

69,436

 

 

 

62,253

 

Current portion of notes payable

 

 

127,029

 

 

 

6,930

 

Advances from a related party

 

 

145,530

 

 

 

147,387

 

Total Current Liabilities

 

 

345,790

 

 

 

219,899

 

 

 

 

 

 

 

 

 

 

Long Term Liabilities

 

 

 

 

 

 

 

 

Notes payable, net of current portion

 

 

-

 

 

 

127,029

 

Total Long-term Liabilities

 

 

-

 

 

 

127,029

 

 

 

 

 

 

 

 

 

 

Total Liabilities

 

 

345,790

 

 

 

346,928

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY-

 

 

 

 

 

 

 

 

Convertible preferred stock, Series 2, par value $0.01; authorized 10,000,000 shares; issued and outstanding 5,000 at March 31, 2024 and June 30, 2023

 

 

50

 

 

 

50

 

Convertible preferred stock, Series 3, par value $0.01; authorized 1,670,000 shares; zero shares issued and outstanding

 

 

 

 

 

 

Convertible preferred stock, Series 5; no par value, 1 share authorized and zero shares issued and outstanding.

 

 

 

 

 

 

Common stock, par value $0.01; At March 31, 2024 and June 30, 2023, authorized 60,000,000 shares; issued and outstanding 3,292,945 shares and 3,292,945 shares, respectively

 

 

32,929

 

 

 

32,929

 

Additional paid-in capital

 

 

21,057,116

 

 

 

21,057,116

 

Accumulated other comprehensive income

 

 

14,144

 

 

 

23,019

 

Accumulated deficit

 

 

(20,759,487 )

 

 

(20,762,335 )

TOTAL STOCKHOLDERS’ EQUITY

 

 

344,752

 

 

 

350,779

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$690,542

 

 

$697,707

 

 

See accompanying notes to condensed unaudited consolidated financial statements.

 

 
3

Table of Contents

 

ADVANCED OXYGEN TECHNOLOGIES, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(Unaudited) 

 

 

 

For the three months ended

March 31,

 

 

For the nine months ended

March 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

Rent Revenues

 

$10,770

 

 

$10,447

 

 

$31,904

 

 

$28,805

 

Total Revenues

 

 

10,770

 

 

 

10,447

 

 

 

31,904

 

 

 

28,805

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and Administrative

 

 

1,379

 

 

 

4,559

 

 

 

4,949

 

 

 

7,631

 

Professional fees

 

 

4,000

 

 

 

3,500

 

 

 

17,500

 

 

 

15,500

 

Total Operating Expenses

 

 

5,379

 

 

 

8,059

 

 

 

22,451

 

 

 

23,131

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

5,391

 

 

 

2,388

 

 

 

9,453

 

 

 

5,674

 

Other income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income (expense)

 

 

-

 

 

 

(183 )

 

 

285

 

 

 

(668 )

Gain on Tax Settlement

 

 

-

 

 

 

-

 

 

 

10

 

 

 

-

 

FX Transaction Income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

34

 

Total Other Income (Expenses)

 

 

-

 

 

 

(183 )

 

 

296

 

 

 

(634 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Before Income Taxes

 

 

5,391

 

 

 

2,205

 

 

 

9,749

 

 

 

5,040

 

Income Taxes Expense

 

 

2,871

 

 

 

2,058

 

 

 

6,902

 

 

 

5,894

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME (LOSS)

 

$2,520

 

 

$147

 

 

$2,848

 

 

$(854 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average number of common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

3,292,945

 

 

 

3,292,945

 

 

 

3,292,945

 

 

 

3,292,945

 

Dilutive

 

 

3,302,945

 

 

 

3,302,945

 

 

 

3,302,945

 

 

 

3,292,945

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per Share

 

$0.00

 

 

$0.00

 

 

$0.00

 

 

$(0.00 )

Dilutive earnings per Share

 

$0.00

 

 

$0.00

 

 

$0.00

 

 

$(0.00 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER COMPREHENSIVE INCOME (LOSS)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET INCOME (LOSS)

 

$2,520

 

 

$147

 

 

$2,848

 

 

$(854 )

Foreign Currency Translation Adjustments

 

$(18,265 )

 

$14,039

 

 

$(8,875 )

 

$27,982

 

TOTAL COMPREHENSIVE INCOME (LOSS)

 

$(15,745 )

 

$14,186

 

 

$(6,022 )

 

$27,128

 

 

See accompanying notes to condensed unaudited consolidated financial statements.

 

 
4

Table of Contents

 

 

ADVANCED OXYGEN TECHNOLOGIES INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Nine-Month Period Ending March 31, 2024 and 2023

(Unaudited)

 

 

 

Preferred Stock Convertible

Series 2

 

 

Common

Stock

 

 

Additional

Paid In

 

 

Accumulated

 

 

Accumulated Other Comprehensive

 

 

Total Stockholders’

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

Income

 

 

Equity

 

Balance at June 30, 2022

 

 

5,000

 

 

 

50

 

 

 

3,292,945

 

 

 

32,929

 

 

 

21,057,116

 

 

 

(20,764,606 )

 

 

(5,820 )

 

 

319,669

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(854 )

 

 

 

 

 

(854 )

Foreign Currency Translation Adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

27,982

 

 

 

27,982

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at March 31, 2023

 

 

5,000

 

 

 

50

 

 

 

3,292,945

 

 

 

32,929

 

 

 

21,057,116

 

 

 

(20,765,460 )

 

 

22,162

 

 

 

34,697

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at June 30, 2023

 

 

5,000

 

 

 

50

 

 

 

3,292,945

 

 

 

32,929

 

 

 

21,057,116

 

 

 

(20,762,335 )

 

 

23,019

 

 

 

350,779

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,848

 

 

 

 

 

 

2,848

 

Foreign Currency Translation Adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(8,875 )

 

 

(8,875 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at March 31, 2024

 

 

5,000

 

 

 

50

 

 

 

3,292,945

 

 

 

32,929

 

 

 

21,057,116

 

 

 

(20,759,487 )

 

 

14,144

 

 

 

344,752

 

 

See accompanying notes to condensed unaudited consolidated financial statements.

 

 
5

Table of Contents

 

ADVANCED OXYGEN TECHNOLOGIES INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Three-Month Period Ending March 31, 2024 and 2023

(Unaudited)

 

 

 

Preferred Stock Convertible

Series 2

 

 

Common

Stock

 

 

Additional

Paid In

 

 

Accumulated

 

 

Accumulated Other Comprehensive

 

 

Total Stockholders’

 

 

 

Shares

 

 

Amount

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Deficit

 

 

Income

 

 

Equity

 

Balance at December 31, 2022

 

 

5,000

 

 

 

50

 

 

 

3,292,945

 

 

 

32,929

 

 

 

21,057,116

 

 

 

(20,765,607 )

 

 

8,123

 

 

 

332,611

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

147

 

 

 

 

 

 

147

 

Foreign Currency Translation Adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14,039

 

 

 

14,039

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at March 31, 2023

 

 

5,000

 

 

 

50

 

 

 

3,292,945

 

 

 

32,929

 

 

 

21,057,116

 

 

 

(20,765,460 )

 

 

22,162

 

 

 

34,697

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at December 31, 2023

 

 

5,000

 

 

 

50

 

 

 

3,292,945

 

 

 

32,929

 

 

 

21,057,116

 

 

 

(20,762,007 )

 

 

32,409

 

 

 

360,497

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,520

 

 

 

 

 

 

2,520

 

Foreign Currency Translation Adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(18,265 )

 

 

(18,265 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at March 31, 2024

 

 

5,000

 

 

 

50

 

 

 

3,292,945

 

 

 

32,929

 

 

 

21,057,116

 

 

 

(20,759,487 )

 

 

14,144

 

 

 

344,752

 

 

See accompanying notes to condensed unaudited consolidated financial statements.

 

 
6

Table of Contents

 

ADVANCED OXYGEN TECHNOLOGIES, INC. 

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

 

 

For the Nine Months

Ended March 31,

 

 

 

2024

 

 

2023

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (loss)

 

$2,848

 

 

 

(854 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities

 

 

 

 

 

 

 

 

Expenses paid on behalf of the company by a related party

 

 

20,850

 

 

 

13,550

 

Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

Accounts payable and accrued liabilities

 

 

775

 

 

 

5,825

 

Taxes payable

 

 

7,690

 

 

 

4,296

 

Accrued Expenses

 

 

-

 

 

 

-

 

Net cash provided by operating activities

 

 

31,358

 

 

 

22,817

 

 

 

 

 

 

 

 

 

 

Cash flow from financing activities:

 

 

 

 

 

 

 

 

Repayment of related party debt

 

 

(23,478 )

 

 

(8,866 )

Repayment of long-term debt

 

 

(6,930 )

 

 

(13,439 )

Net cash used in financing activities

 

 

(29,637 )

 

 

(22,305 )

Change due to Foreign Currency Translation

 

 

(1,353 )

 

 

5,055

 

NET CHANGE IN CASH

 

 

403

 

 

 

5,567

 

 

 

 

 

 

 

 

 

 

Cash at beginning of period

 

$104,836

 

 

$94,216

 

Cash at end of period

 

$105,239

 

 

$99,783

 

Supplemental Disclosures of Cash Flow Information

 

 

 

 

 

 

 

 

Cash paid for Interest

 

$285

 

 

$668

 

Cash paid for Income taxes

 

$-

 

 

$-

 

 

See accompanying notes to condensed unaudited consolidated financial statements.

 

 
7

Table of Contents

 

ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

NOTE 1 - ORGANIZATION AND LINE OF BUSINESS:

 

Organization:

 

Advanced Oxygen Technologies Inc., (“Advanced Oxygen Technologies”, “AOXY”, or the “Company”), was incorporated in Delaware in 1981 under the name Aquanautics Corporation and was, from 1985 until May 1995, a startup stage specialty materials company producing new oxygen control technologies. From May of 1995 through December of 1997 the Company had minimal operations and was seeking funding for operations and companies to which it could merge or acquire. In March of 1998 the Company began operations again in California. From 1998 through 2000, the business produced and sold CD- ROMS for conference events, advertisement sales on the CD’s, database management and event marketing all associated with conference events. From 2000 through March of 2003, the business consisted solely of database management. From 2003 through April 2005, the business operations were derived totally from the Company’s wholly owned business, IP Service, ApS, a Danish IP security vulnerability company (“IP Service”). Since then, business operations have been solely derived from its wholly owned subsidiaries Anton Nielsen Vojens, ApS (“ANV”), Sharx Inc. and its wholly owned subsidiary Sharx DK ApS (collectively “Sharx”).

 

Lines of Business:

 

Advanced Oxygen Technologies, Inc. operations are derived from its wholly owned subsidiaries Anton Nielsen Vojens, ApS (“ANV”), Sharx Inc. and its wholly owned subsidiary Sharx DK ApS (collectively “Sharx”).

 

ANV is a Danish company that owns commercial real estate in Vojens, Denmark. ANV’s revenues are derived solely from the lease revenue from its real estate. Circle K Denmark A/S, formerly StatOil A/S, leases the facility from ANV. The lease expires in 2026.

 

Sharx Inc. is a Wyoming corporation incorporated in 2020 that owns Sharx DK ApS. Sharx Inc. operations are derived from its wholly owned subsidiary Sharx DK ApS. Sharx Inc. has no other operations and performs administrative functions for itself and its subsidiary.

 

Sharx DK ApS is a Danish company, incorporated in 2020. On June 30, 2020, Sharx DK ApS, entered into a Distribution Agreement (the “Distribution Agreement” Exhibit 10.1) with a third-party vendor, Cleaver ApS, a Danish corporation (“Cleaver”), whereby Cleaver has appointed the Company as Cleaver’s nonexclusive distributor of its products in Europe, South America and North America. Cleaver is a manufacturer of a line of products for the logistics and cargo industry. Sharx had no activity for the period ending March 31, 2024.

 

Other Risk and Uncertainties:

 

In May 2023, the World Health Organization determined that COVID-19 no longer fit the definition of a public health emergency and the U.S. government announced its plan to let the declaration of a public health emergency associated with COVID-19 expire on May 11, 2023. COVID-19 is expected to remain a serious endemic threat for an indefinite future period and may continue to adversely affect the global economy, and we are unable to predict the full extent of potential delays or impacts on our business, our clinical studies, our research programs, the recoverability of our assets, and our manufacturing. The effects of the COVID-19 endemic may continue to disrupt or delay our business operations, including but not limited to with respect to efforts relating to potential business development transactions and our ability to deploy staffing workforce effectively during social distancing and shelter-in-place directives, and it could continue to disrupt the marketplace which could have an adverse effect on our operations. As such, it is uncertain as to the full magnitude that the COVID-19 and its ongoing effects will have on the Company’s financial condition, liquidity, and future results of operations. Management is actively monitoring the impact of the global situation on its financial condition, liquidity, operations, industry, and workforce. The Company is not able to estimate the effects of the COVID-19 endemic on its results of operations, financial condition, or liquidity for fiscal year 2023.

 

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

 

Principles of Consolidation:

 

The accompanying consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries (ANV and Sharx), after elimination of all intercompany accounts, transactions, and profits.

 

Basis of Presentation:

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The Company’s fiscal year end is June 30.

 

 
8

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ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

The accompanying condensed consolidated financial statements are unaudited. In the opinion of management, all adjustments of a normal recurring nature, considered necessary for a fair presentation of financial position, results of operations, and cash flows at the dates and for the periods presented have been included. The results of operations of any interim period are not necessarily indicative of the results of operations for the full year. All intercompany balances are eliminated in consolidation.

 

Certain information and note disclosures normally included in annual financial statements have been condensed or omitted from these interim financial statements; these financial statements should be read in conjunction with the financial statements and notes thereto included in our Form 10-K for the year ended June 30, 2023.

 

Use of Estimates

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

 

Revenue Recognition:

 

Revenue from Contracts with Customers 

 

For our rental revenue and commission revenue, we recognize revenue under the five steps in Topic 606, which are as follows: 1) identify the contract with the customer; 2) identify the performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance obligations; and 5) recognize revenue when (or as) performance obligations are satisfied.

 

Rental Revenue

 

Rental revenue is derived from the Commercial Property lease in which quarterly payments are received pursuant to the property lease which is in effect until 2026. We recognize revenue when we have satisfied a performance obligation by transferring control over a product or delivering a service to a client. We measure revenue based upon the consideration set forth in an arrangement or contract with a client. We recognize revenue from these services when the services are completed. If we are paid in advance for these services, we record such payment as a contract liability until we complete the services. As of March 31, 2024, the Company recorded $3,020 of contract liabilities in connection to rental revenues.

 

The Company leases land to a customer. We, as a lessor, retain substantially all of the risks and benefits of ownership of the investment properties and account for our leases as operating leases. We accrue fixed lease income on a straight-line basis over the terms of the leases when we believe substantially all lease income, including the related straight-line rent receivable, is probable of collection. For our leases, we receive a fixed payment from the customer which is recognized as lease income on a straight-line basis over the term of the lease beginning with the adoption of ASC 842.

 

In April 2020, the Financial Accounting Standards Board (“FASB”) staff released guidance focused on treatment of concessions related to the effects of COVID-19 on the application of lease modification guidance in Accounting Standards Codification (ASC) 842, “Leases.” The guidance provides a practical expedient to forgo the associated reassessments required by ASC 842 when changes to a lease result in similar or lower future consideration. We have elected to generally account for rent abatements as negative variable lease consideration in the period granted, or in the period we determine we expect to grant an abatement. Further abatements granted in the future will reduce lease income in the period we grant, or determine we expect to grant, an abatement. We have not agreed to any deferral or abatement arrangements with any of our customers.

 

The Company has elected to exclude short-term leases from the recognition requirements of ASC 842. A lease is short-term if, at the commencement date, it has a term of less than or equal to one year. Lease expense related to short-term leases is recognized on a straight-line basis over the lease term.

 

Commission revenue

 

For our commission revenue, we recognize revenue under the five steps in Topic 606, which are as follows: 1) identify the contract with the customer; 2) identify the performance obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance obligations; and 5) recognize revenue when (or as) performance obligations are satisfied.

 

The Company’s source of commission revenue is from the Company’s subsidiary Sharx in which quarterly payments are received when the customer pre-pays or pays upon the date products are drop shipped from the manufacturer pursuant to a non-exclusive distribution agreement. At such time the products are drop shipped, the Company’s performance obligation has been satisfied and revenue is recorded. The Company has determined that it is an agent of the manufacturer and collects commission revenue at or before the delivery of product (See Note 3 for further details). 

 

 
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ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

Cash and Cash Equivalents:

 

For purposes of the statement of cash flows, the Company considers all highly-liquid investments purchased with original maturities of three months or less to be cash equivalents.

 

The Company maintains its cash in bank deposit accounts which, at March 31, 2024 did not exceed federally insured limits. The Company has not experienced any losses in such accounts and believes that it is not exposed to any significant credit risk on such amounts.

 

Property and Equipment:

 

Land is recognized at cost. Land is carried at cost less accumulated impairment losses.

 

Foreign currency translation:

 

Foreign currency transactions are translated applying the current rate method. Assets and liabilities are translated at current rates. Stockholders’ equity accounts are translated at the appropriate historical rates and revenue and expenses are translated at weighted average rates for the year.

 

Foreign currency transactions:

 

The Company applies the guidelines as set out in Section 830-20-35 of the FASB Accounting Standards Codification (“Section 830-20-35”) for foreign currency transactions. Pursuant to Section 830-20-35 of the FASB Accounting Standards Codification, foreign currency transactions are transactions denominated in currencies other than U.S. Dollar, the Company’s reporting currency. Foreign currency transactions may produce receivables or payables that are fixed in terms of the amount of foreign currency that will be received or paid. A change in exchange rates between the reporting currency and the currency in which a transaction is denominated increases or decreases the expected amount of reporting currency cash flows upon settlement of the transaction. That increase or decrease in expected reporting currency cash flows is a foreign currency transaction gain or loss that generally shall be included in determining net income for the period in which the exchange rate changes. Likewise, a transaction gain or loss (measured from the transaction date or the most recent intervening balance sheet date, whichever is later) realized upon settlement of a foreign currency transaction generally shall be included in determining net income for the period in which the transaction is settled. The exceptions to this requirement for inclusion in net income of transaction gains and losses pertain to certain intercompany transactions and to transactions that are designated as, and effective as, economic hedges of net investments and foreign currency commitments. Pursuant to Section 830-20-25 of the FASB Accounting Standards Codification, the following shall apply to all foreign currency transactions of an enterprise and its investees: (a) at the date the transaction is recognized, each asset, liability, revenue, expense, gain, or loss arising from the transaction shall be measured and recorded in the functional currency of the recording entity by use of the exchange rate in effect at that date as defined in section 830-10-20 of the FASB Accounting Standards Codification; and (b) at each balance sheet date, recorded balances that are denominated in currencies other than the functional currency or reporting currency of the recording entity shall be adjusted to reflect the current exchange rate.

 

The Company’s wholly owned subsidiary ANV uses the Danish Krone, DKK as its reporting currency as well as its functional currency.

 

The wholly owned subsidiary Sharx DK ApS uses the US Dollar as its reporting currency as well as its functional currency and from time to time has transactions in foreign currencies. The change in exchange rates between the U.S. Dollar, the Company’s reporting and functional currency and the foreign currency, the currency in which a transaction is denominated increases or decreases the expected amount of reporting currency cash flows upon settlement of the transaction. That increase or decrease in expected reporting currency cash flows is a foreign currency transaction gain or loss that generally is included in determining net income (loss) for the period in which the exchange rate changes. 

 

 
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ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

 Income Taxes:

 

The Company accounts for income taxes under the asset and liability method of accounting. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is required when it is less likely than not that the Company will be able to realize all or a portion of its deferred tax assets. Because it is doubtful that the net operating losses of recent years will ever be used, a valuation allowance has been recognized equal to the tax benefit of net operating losses generated.

 

Earnings per Share:

 

Basic earnings per share is computed by dividing income available to common shareholders by the weighted-average number of common shares available. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive.

 

As of March 31, 2024, and March 31, 2023 there were 10,000 and 10,000, potential dilutive shares that need to be considered as common share equivalents and because of the net income, the effect of these potential common shares is dilutive for the nine-months ended March 31, 2024 and anti-dilutive for nine-months ended March 31, 2023. For the three-months ended March 31, 2024 and three-months March 31, 2023 the effect of these potential common shares is dilutive.

 

 
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ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

Stock-Based Compensation:

 

The Company records stock-based compensation in accordance with ASC 718, Compensation. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. Equity instruments issued to employees and the cost of the services received as consideration are measured and recognized based on the fair value of the equity instruments issued and are recognized over the employees required service period, which is generally the vesting period.

 

Concentrations of Credit Risk:

 

Financial instruments that potentially subject the Company to major credit risk consist principally of a single subsidiary of Anton Nielsen Vojens ApS. ANV’s rent revenues are derived from one customer. The Company’s commission revenues are subject to concentration risk as the commission revenues are derived from one product.

 

New Accounting Pronouncements Already Adopted

 

None.

 

New Accounting Pronouncements Not Yet Adopted

 

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280). The amendments in this ASU require disclosures, on an annual and interim basis, of significant segment expenses that are regularly provided to the chief operating decision maker (CODM), as well as the aggregate amount of other segment items included in the reported measure of segment profit or loss. This ASU requires that a public entity disclose the title and position of the CODM and an explanation of how the CODM uses the reported measure(s) of segment profit or loss. Public entities will be required to provide all annual disclosures currently required by Topic 280 in interim periods, and entities with a single reportable segment are required to provide all the disclosures required by the amendments in the update and existing segment disclosures in Topic 280. ASU 2023-07 is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, and requires retrospective adoption. Early adoption is permitted. The Company will adopt this standard beginning with our fiscal year ending June 30, 2025. The Company is currently evaluating these new disclosure requirements and does not expect the adoption to have a material impact.

 

Other recent accounting pronouncements issued by the FASB did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

 

 
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ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

NOTE 3 - REVENUE:

 

The Company’s subsidiary, Anton Nielsen Vojens, ApS has one customer who is a non-related party and leases property from the Company. Rent revenues related to the operating lease are recognized as incurred. The Company’s subsidiary Sharx DK ApS had zero retail customers for the three and nine month period ending March 31, 2024 and zero for the three and nine month period ending March 31, 2023. The Company has determined that is an agent of the manufacturer and collects commission revenue at or before the delivery of product.

 

The Company disaggregates revenues by revenue type and geographic location. See the below tables:

 

 

 

Three Months Ended March 31,

 

Revenue Type

 

2024

 

 

2023

 

Real Estate Rental

 

$10,770

 

 

$10,447

 

Commission Revenues

 

 

 

 

 

 

Total Sales by Revenue Type

 

$10,770

 

 

$10,447

 

 

 

 

Nine Months Ended March 31,

 

Revenue Type

 

2024

 

 

2023

 

Real Estate Rental

 

$31,904

 

 

$28,805

 

Commission Revenues

 

 

 

 

 

 

Total Sales by Revenue Type

 

$31,904

 

 

$28,805

 

 

The Company’s derives revenues from 100% of foreign revenues. For the period ending March 31, 2024 and March 31, 2023 the major geographic concentrations were as follows:

 

 

 

Geographic Regions

 

 

 

for the Three Months

Ended March 31,

 

Revenue Type

 

2024

 

 

2023

 

International

 

$10,770

 

 

$10,447

 

Domestic

 

 

 

 

 

 

Total Sales by Geographic Location

 

$10,770

 

 

$10,447

 

 

 

 

Geographic Regions

 

 

 

for the Nine Months

Ended March 31,

 

Revenue Type

 

2024

 

 

2023

 

International

 

$31,904

 

 

$28,805

 

Domestic

 

 

 

 

 

 

Total Sales by Geographic Location

 

$31,904

 

 

$28,805

 

 

 
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ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

NOTE 4 - PROPERTY AND EQUIPMENT:

 

The Land owned by the Company’s wholly owned subsidiary constitutes the largest asset of the Company. During the nine-month period ending March 31, 2024 the Company recorded a decrease in the carrying value of the Land of $(7,554), due to the currency translation difference. The carrying value of the Land of the Company was as follows:

 

 

 

 Carrying Value of Land at

 

 

 

March 31,

2024

 

 

June 30,

2023

 

US Dollars

 

$584,151

 

 

$591,705

 

 

NOTE 5 - RELATED PARTY TRANSACTIONS:

 

Crossfield, Inc., a company of which the CEO, Robert Wolfe is an officer and director, has made advances to the Company which are not collateralized, non-interest bearing, and payable upon demand. At March 31, 2024 and June 30, 2023, the Company had a balance of $145,530 and $147,387 respectively. During the nine-month period ended March 31, 2024 and 2023 expenses paid on behalf of the Company were $20,850 and $13,550 respectively. The Company repaid $23,478 of the advancement during the nine-month period ending March 31, 2024.

 

NOTE 6 - NOTES PAYABLE:

 

During 2006, the Company issued a promissory note (“Note”) for $650,000, payable to the Borkwood Development Ltd, a previous shareholder of the Company (“Seller”), payable and amortized monthly and carrying an interest at 5% per year. The Company has the right to prepay the note at any time with a notice of 14 days. To secure the payment of principal and interest the Sellers will receive a perfect lien and security interest in the Shares in the company ANV until the note with accrued interest is paid in full, and, 2) In the case that the Note has not been repaid within 12 months from the day of closing the Sellers have the right to convert the debt to common stock of Advanced Oxygen Technologies, Inc. in an amount of non-diluted shares calculated on the conversion Date, equal to the lesser of : a) Six hundred and Fifty thousand (650,000) or the Purchase Price minus the principal payments made by the buyer, whichever is greater, divided by the previous ten day closing price of AOXY as quoted on the national exchange, or b) Fifteen million shares, whichever is lesser. The Note has been extended until July 1, 2024, prior to period end and interest waived through the period ending June 30, 2024. As of March 31, 2024, the unpaid balance was $127,029.

 

The Company had a note payable with a bank (“Note B”). The original amount of Note B was kr1,132,000 Danish Krone (kr). Note B was secured by the subsidiary’s real estate, witha2.00% interest rate and matured at December 31,2023. The balance on the note as of March 31, 2024 was $0.

 

The Company’s commitments and contingencies are $127,029 for 2024. See below table for the years 2024 through 2025 with total principal payments due on outstanding notes payable of $127,029. The amounts stated reflect the Company’s commitments in the currencies that those commitments were made and the amounts are an estimate of what the US dollar amount would be if the currency rates did not change.

 

Fiscal Year Ending

 

Amount

 

2024

 

 

127,029

 

Total

 

 

127,029

 

Less: Long-term portion of notes payable

 

$-

 

 

 

 

 

 

Notes payable, current portion

 

$127,029

 

 

The amounts stated reflect the Company’s commitments in the currencies that those commitments were made and the amounts are an estimate of what the US dollar amount would be if the currency rates did not change going forward.

 

 
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ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

NOTE 7 - STOCKHOLDERS’ EQUITY:

 

Common Stock:

 

The Company is authorized to issue 60,000,000 shares of Common stock, par value $0.01; At March 31, 2024 and June 30, 2023 there were 3,292,945 and 3,292,945 shares issued and outstanding, respectively.

 

Preferred Stock:

 

Series 2 Convertible Preferred Stock:

 

The Company is authorized to issue 10,000,000 shares of $0.01 par value of series 2 convertible preferred stock. Each Series 2 preferred share also includes one warrant to purchase two common shares for $5.00. The warrants are exercisable over a three-year period. In the event of the liquidation of the Company, holders of Series 2 preferred stock would be entitled to receive $5.00 per share, plus any unpaid dividends declared on the Series 2 preferred stock from the funds remaining after the Company’s creditors, including directors, have been paid. There have been no dividends declared. There are 177,000 Series 2 Convertible Preferred shares designated. As of March 31, 2024, and June 30, 2023 there are 5,000 shares issued, which are convertible into 10,000 common shares. There are no warrants outstanding that have been issued in connection with these preferred shares.

 

 
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ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

Series 3 Convertible Preferred Stock:

 

The Company has designated1,670,000 shares of series 3 convertible preferred stock with a par value $0.01Each share automatically converts on March 2, 2000 into either (a) one (1) share of the Company’s common stock if the average closing price of the common stock during the ten trading days immediately prior to March 1, 2000 is equal to or greater than sixty-six cents ($0.66) per share, or (b) one and one-half (1 1/2) shares of common stock if the average closing price of the common stock during the ten trading days immediately prior March 1, 2000 is less than sixty-six cents ($0.66) per share. There were zero shares of Series 3 Convertible Preferred Stock converted to common stock.  There are zero shares issued and outstanding at March 31, 2024 and 2023.

 

Series 5 Convertible Preferred Stock:

 

The Company has designated1 share of series 5 convertible preferred stock, no par value.  There is 1 Series 5 Convertible Preferred shares designated. The shares are collectively convertible to common stock of the Company on March 5, 2004, in an amount equal to the greater of a.) 290,000 shares divided by the ten-day closing price, prior to the date of acquisition of IPS, of the Company’s common stock as quoted on the national exchange and not to exceed twenty million shares, or b.) six million shares. There were zero shares of Series 5 Convertible Preferred Stock converted to common stock.  There are zero shares issued and outstanding at March 31, 2024 and 2023.

 

NOTE 8 - SEGMENT AND GEOGRAPHIC INFORMATION

 

Segment Performance

 

We have three reporting segments:

 

The ANV lease segment which leases land in Denmark by long term leases.

The Sharx’s segment which generate commissions for the sale cargo security products.

The Corporate segment, Advanced Oxygen Technologies, Inc. which does not generate revenues, but has administrative expenses.

 

 
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ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

The following table summarizes financial information regarding each reportable segment’s results of operations for the periods presented:

 

 

 

Nine Months Ending

March 31,

 

 

 

2024

 

 

2023

 

 

 

 

 

 

 

 

Revenue by segment

 

 

 

 

 

 

Lease revenues

 

$31,904

 

 

$28,805

 

Commission revenues from security product sales

 

 

 

 

 

 

Corporate revenues

 

 

 

 

 

 

Total revenue

 

$31,904

 

 

$28,805

 

 

 

 

 

 

 

 

 

 

Segment profitability

 

 

 

 

 

 

 

 

Lease income (loss)

 

$24,473

 

 

$28,899

 

Commission income (loss)from security product sales

 

 

-

 

 

 

(2,378 )

Corporate income (loss)

 

 

21,625

 

 

 

(19,375 )

Total segment profitability

 

$2,848

 

 

$(854 )

 

 

 

Three Months Ending

March 31,

 

 

 

2024

 

 

2023

 

 

 

 

 

 

 

 

Revenue by segment

 

 

 

 

 

 

Lease revenues

 

$10,770

 

 

$10,447

 

Commission revenues from security product sales

 

 

 

 

 

 

Corporate revenues

 

 

 

 

 

 

Total revenue

 

$10,770

 

 

$10,447

 

 

 

 

 

 

 

 

 

 

Segment profitability

 

 

 

 

 

 

 

 

Lease income

 

$7,799

 

 

$7,300

 

Commission income (loss) from security product sales

 

 

(4 )

 

 

(2,378 )

Corporate income (loss)

 

 

2,575

 

 

 

(4,775 )

Total segment profitability

 

$2,520

 

 

$147

 

 

 
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ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

The following table presents net sales, based on the location in which the sale originated, and long-lived assets, representing property, plant and equipment, net of related depreciation, by geographic region. All of the assets are land that are held by the Company’s subsidiary, ANV.

 

Three Months Ending March 31:

 

2024

 

 

2023

 

Net Sales

 

 

 

 

 

 

United States

 

$-

 

 

$-

 

Denmark

 

 

10,770

 

 

 

10,447

 

Total

 

$10,770

 

 

$10,447

 

 

As of March 31, 2024 and June 30, 2023

 

Mar 31, 2024

 

 

June 30, 2023

 

Long-Lived Assets

 

 

 

 

 

 

United States

 

$-

 

 

$-

 

Denmark

 

 

584,151

 

 

 

591,705

 

Total

 

$584,151

 

 

$591,705

 

 

Nine Months Ending March 31:

 

2024

 

 

2023

 

Net Sales

 

 

 

 

 

 

United States

 

$-

 

 

$-

 

Denmark

 

 

31,904

 

 

 

28,805

 

Total

 

$31,904

 

 

$28,805

 

 

 
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ADVANCED OXYGEN TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

 

Three Months Ending March 31, 2024

 

 

ANV

 

 

Sharx

 

 

Corporate

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$10,770

 

 

$

 

 

$

 

 

$10,770

 

Operating income (loss)

 

$10,666

 

 

$

 

 

$(5,275 )

 

$5,391

 

Interest expense

 

$

 

 

$

 

 

$

 

 

$

 

Total assets

 

$690,392

 

 

$

 

 

$150

 

 

$690,542

 

 

Three Months Ending March 31, 2023

 

 

ANV

 

 

Sharx

 

 

Corporate

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$10,447

 

 

$

 

 

$

 

 

$10,447

 

Operating (loss) income

 

$9,541

 

 

$(2,378 )

 

$(4,775 )

 

$2,388

 

Interest expense

 

$(183 )

 

$

 

 

$

 

 

$(183 )

Total assets

 

$691,782

 

 

$34

 

 

$150

 

 

$691,966

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ending March 31, 2024

 

 

ANV

 

 

Sharx

 

 

Corporate

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$31,904

 

 

$

 

 

$

 

 

$31,904

 

Operating income (loss)

 

$31,086

 

 

$(8 )

 

$(21,625 )

 

$9,453

 

Interest expense

 

$285

 

 

$

 

 

$

 

 

$285

 

Total assets

 

$690,392

 

 

$

 

 

$150

 

 

$690,542

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ending March 31, 2023

 

 

ANV

 

 

Sharx

 

 

Corporate

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$28,805

 

 

$

 

 

$

 

 

$28,805

 

Operating income (loss)

 

$27,461

 

 

$(2,412 )

 

$(19,375 )

 

$5,674

 

Interest expense

 

$(668 )

 

$

 

 

$

 

 

$(668 )

Total assets

 

$691,782

 

 

$34

 

 

$150

 

 

$691,966

 

 

NOTE 9 - SUBSEQUENT EVENTS:

 

In accordance with ASC 855-10, Company management reviewed all material events through the date of this report.

 

 
19

Table of Contents

 

ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

 

The following should be read in conjunction with our Consolidated Financial Statements and the notes thereto included in the Financial Statements.

 

FORWARD LOOKING STATEMENTS:

 

Certain statements contained in this report, including statements concerning the Company’s future and financing requirements, the Company’s ability to obtain market acceptance of its products and the competitive market for sales of small production business and other statements contained herein regarding matters that are not historical facts, are forward looking statements; actual results may differ materially from those set forth in the forward looking statements, which statements involve risks and uncertainties, including without limitation to those risks and uncertainties set forth in any of the Company’s Registration Statements and Annual reports on form 10K under the heading “Risk Factors” or any other such heading. In addition, historical performance of the Company should not be considered as an indicator for future performance, and as such, the future performance of the Company may differ significantly from historical performance.

 

REVENUES: Revenues from operations for the three-month period ending March 31, 2024 and March 31, 2023 were $10,770 and $10,447 respectively, and for the nine-month period ending March 31, 2024 and March 31, 2023 were $31,904 and $28,805 respectively. The increases are attributable to lease revenues and currency fluctuations.

 

GENERAL AND ADMINISTRATIVE EXPENSES: G&A expenses for the three-month period ending March 31, 2024 and March 31, 2023 were $1,379 and $4,559 respectively, and for the nine-month period ending March 31, 2024 and March 31, 2023 were $4,949 and $7,631 respectively. The expenses are mainly attributable to ANV’s normal operations and the Company’s SEC compliance.

 

PROFESSIONAL EXPENSES: Professional expenses for the three-month period ending March 31, 2024 and March 31, 2023 were $4,000 and $3,500 respectively, and for the nine-month period ending March 31, 2024 and March 31, 2023 were $17,500 and $15,500 respectively. The expenses were attributable to the ordinary auditing fees for 2024 and 2023.

 

OTHER INCOME (EXPENSES): Other income (expenses) for the three-month period ending March 31, 2024 and March 31, 2023 were $0, and $(183) respectively, and for the nine-month period ending March 31, 2024 and March 31, 2024 were $295and $634 respectively. The fluctuations are mainly attributable to interest expenses.

 

NET INCOME (LOSS): Net income attributed to common stockholders was $2,520 or $0.00 per basic and diluted share for the three-month period ending March 31, 2024 as compared to $147 or $0.00 per basic and diluted share for March 31, 2023. Net income (loss) attributed to common stockholders was $2,848 or $0.00 per basic and diluted share for the nine-month period ending March 31, 2024 as compared to $(854) or $(0.00) per basic and diluted share for March 31, 2023. The fluctuations are mainly attributable to lease revenues.

 

LIQUIDITY AND CAPITAL RESOURCES: At March 31, 2024 and June 30, 2023, the Company had cash and cash equivalents of $105,239 and $104,836 respectively. At March 31, 2024 and June 30, 2023, the Company had a working capital deficit of $239,399 and $113,179 respectively. The change in cash is primarily due to currency translation. The increase in the working capital deficit is primarily related to the reduction of the long term debt and an increase in the current portion of notes payable.

 

Net cash provided by operating activities for nine-month period ending March 31, 2024 and March 31, 2023 was $32,163 and $22,817, respectively. The increase was primarily due to expenses paid on behalf of related party and taxes payable.

 

Net cash (used-in) financing activities for nine-month period ending March 31, 2024 and March 31, 2023 was $(30,408) and $(22,305) respectively. Net cash used in financing activities for both periods is related to the company’s borrowings from banks, officers and directors, and the repayment of debt.

 

OFF BALANCE SHEET ARRANGEMENTS:

 

We do not currently have any off-balance sheet arrangements.

 

ACQUISITION EFFORTS:

 

The Company continues its efforts to raise capital to support operations and growth and is actively searching acquisition or merger with another company that would complement AOXY or increase its earnings potential. During this period, the Company has been in discussion with Companies looking to be acquired. AOXY has not negotiated any terms nor proposed any acquisitions of any of these companies that have been accepted. In addition, the Company is in discussion with potential lending institutions to assist in financing any proposed acquisition. The Company expects difficulty in financing the growth of the increased business or acquisition and has been concentrating on raising capital and/or obtaining a line of credit.

 

 
20

Table of Contents

 

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK:

 

Smaller reporting companies are not required to provide the information required by this Item.

 

ITEM 4. CONTROLS AND PROCEDURES

 

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

 

We conducted an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer who is also our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. The term “disclosure controls and procedures”, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as amended (“Exchange Act”), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by the company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures also include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Based on this evaluation, our Chief Executive Officer and Acting Chief Financial Officer concluded as of March 31, 2024 that our disclosure controls and procedures were not effective at ensuring that the material information required to be disclosed in the Exchange Act reports is recorded, processed, summarized and reported as required in applicable SEC rules and the Company’s filed 10-K.

 

Changes in Internal Control over Financial Reporting

 

During the three and nine month period ended March 31, 2024, there were no changes in our internal control over financial reporting identified in connection with managements evaluation of the effectiveness of our internal control over the financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act.

 

 
21

Table of Contents

 

 

PART II

 

ITEM 1: LEGAL PROCEEDINGS

 

During the period ending March 31, 2024, there were pending or threatened legal actions as follows:

 

None

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

None

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None

 

ITEM 4. MINE SAFETY DISCLOSURES

 

None

 

ITEM 5. OTHER INFORMATION

 

None

 

 
22

Table of Contents

 

ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K

 

During three and nine month period ending March 31, 2024, the Company filed no reports on Form 8-K for events occurring during the periods.

 

Exhibit

Number

 

Description of the Document

3.1

 

Certificate of Incorporation as Amended and filed with the Secretary of State of Delaware effective on December 5, 2014(1)

3.2

 

Bylaws(2)

31.1*

 

Certification of Chief Executive Officer pursuant to Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*

 

Certification of Chief Financial Officer pursuant to Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*

 

Certification of Chief Executive Officer in accordance with 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2*

 

Certification of Chief Financial Officer in accordance with 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS

 

Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).

101.SCH

 

Inline XBRL Taxonomy Extension Schema Document

101.CAL

 

Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

 

Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

 

Inline XBRL Taxonomy Extension Labels Linkbase Document

101.PRE

 

Inline XBRL Taxonomy Extension Presentation Linkbase Document

104

 

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

 

*Filed herewith

(1) Filed as an exhibit to the Company’s 8-K filed with the SEC on December 9, 2014 and incorporated herein by reference.

(2) Filed as an exhibit to the Company’s 10-K filed with the SEC on September 28, 2022 and incorporated herein by reference.

 

 
23

Table of Contents

 

 

SIGNATURE

 

In accordance with the requirements of the Exchange Act, the Registrant has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date: May 10, 2024

By:

/s/ Robert E. Wolfe

 

 

 

Robert E. Wolfe

 

 

 

Chairman of the Board and

Chief Executive Officer and

Principal Financial Officer

 

 

 
24

 

nullnullnullnullv3.24.1.1.u2
Cover - shares
9 Months Ended
Mar. 31, 2024
May 10, 2024
Cover [Abstract]    
Entity Registrant Name ADVANCED OXYGEN TECHNOLOGIES, INC.  
Entity Central Index Key 0000352991  
Document Type 10-Q  
Amendment Flag false  
Current Fiscal Year End Date --06-30  
Entity Small Business true  
Entity Shell Company false  
Entity Emerging Growth Company false  
Entity Current Reporting Status Yes  
Document Period End Date Mar. 31, 2024  
Entity Filer Category Non-accelerated Filer  
Document Fiscal Period Focus Q3  
Document Fiscal Year Focus 2024  
Entity Common Stock Shares Outstanding   3,292,945
Entity File Number 0-9951  
Entity Incorporation State Country Code DE  
Entity Tax Identification Number 91-1143622  
Entity Address Address Line 1 C/O Crossfield, Inc.  
Entity Address Address Line 2 653 VT Route 12A  
Entity Address Address Line 3 PO Box 189  
Entity Address City Or Town Randolph  
Entity Address State Or Province VT  
Entity Address Postal Zip Code 05060  
City Area Code 212  
Local Phone Number 727-7085  
Security 12b Title Common Stock, $0.01 Par Value  
Trading Symbol AOXY  
Document Quarterly Report true  
Document Transition Report false  
Entity Interactive Data Current Yes  
v3.24.1.1.u2
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)
Mar. 31, 2024
Jun. 30, 2023
CURRENT ASSETS    
Cash $ 105,239 $ 104,836
Property tax receivable 1,152 1,166
Total Current Assets 106,391 106,002
Property and equipment 584,151 591,705
TOTAL ASSETS 690,542 697,707
CURRENT LIABILITIES    
Accounts payable 775 0
Contract liabilities 3,020 3,059
Taxes payable 69,436 62,253
Current portion of notes payable 127,029 6,930
Advances from a related party 145,530 147,387
Total Current Liabilities 345,790 219,899
Long Term Liabilities    
Notes payable, net of current portion 0 127,029
Total Long-term Liabilities 0 127,029
Total Liabilities 345,790 346,928
STOCKHOLDERS' EQUITY-    
Common stock, par value $0.01; At March 31, 2024 and June 30, 2023, authorized 60,000,000 shares; issued and outstanding 3,292,945 shares and 3,292,945 shares, respectively 32,929 32,929
Additional paid-in capital 21,057,116 21,057,116
Accumulated other comprehensive income 14,144 23,019
Accumulated deficit (20,759,487) (20,762,335)
TOTAL STOCKHOLDERS' EQUITY 344,752 350,779
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY 690,542 697,707
Series 5 Convertible Preferred Stock [Member]    
STOCKHOLDERS' EQUITY-    
Convertible preferred stock, value 0 0
Series 3 Convertible Preferred Stock [Member]    
STOCKHOLDERS' EQUITY-    
Convertible preferred stock, value 0 0
Series 2 Convertible Preferred Stock [Member]    
STOCKHOLDERS' EQUITY-    
Convertible preferred stock, value $ 50 $ 50
v3.24.1.1.u2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares
Mar. 31, 2024
Jun. 30, 2023
Common Stock, Par Value $ 0.01 $ 0.01
Common Stock, Shares Authorized 60,000,000 60,000,000
Common Stock, Shares Issued 3,292,945 3,292,945
Common Stock, Shares Outstanding 3,292,945 3,292,945
Series 5 Convertible Preferred Stock [Member]    
Preferred Stock, Par Value $ 0 $ 0
Preferred Stock, Shares Authorized 1 1
Preferred Stock, Shares Issued 0 0
Preferred Stock, Shares Outstanding 0 0
Series 3 Convertible Preferred Stock [Member]    
Preferred Stock, Par Value $ 0.01 $ 0.01
Preferred Stock, Shares Authorized 1,670,000 1,670,000
Preferred Stock, Shares Issued 0 0
Preferred Stock, Shares Outstanding 0 0
Series 2 Convertible Preferred Stock    
Preferred Stock, Par Value $ 0.01 $ 0.01
Preferred Stock, Shares Authorized 10,000,000 10,000,000
Preferred Stock, Shares Issued 5,000 5,000
Preferred Stock, Shares Outstanding 5,000 5,000
v3.24.1.1.u2
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($)
3 Months Ended 9 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Mar. 31, 2024
Mar. 31, 2023
Revenues        
Rent Revenues $ 10,770 $ 10,447 $ 31,904 $ 28,805
Total Revenues 10,770 10,447 31,904 28,805
Operating Expenses        
General and Administrative 1,379 4,559 4,949 7,631
Professional fees 4,000 3,500 17,500 15,500
Total Operating Expenses 5,379 8,059 22,451 23,131
Income from operations 5,391 2,388 9,453 5,674
Other income (expense)        
Interest income (expense) 0 (183) 285 (668)
Gain on Tax Settlement 0 0 10 0
FX Transaction Income 0 0 0 34
Total Other Income (Expenses) 0 (183) 296 (634)
Income Before Income Taxes 5,391 2,205 9,749 5,040
Income Taxes Expense 2,871 2,058 6,902 5,894
NET INCOME (LOSS) $ 2,520 $ 147 $ 2,848 $ (854)
Weighted Average number of common shares outstanding        
Basic 3,292,945 3,292,945 3,292,945 3,292,945
Dilutive 3,302,945 3,302,945 3,302,945 3,292,945
Basic earnings per Share $ 0.00 $ 0.00 $ 0.00 $ (0.00)
Dilutive earnings per Share $ 0.00 $ 0.00 $ 0.00 $ (0.00)
OTHER COMPREHENSIVE INCOME (LOSS)        
NET INCOME (LOSS) $ 2,520 $ 147 $ 2,848 $ (854)
Foreign Currency Translation Adjustments (18,265) 14,039 (8,875) 27,982
TOTAL COMPREHENSIVE INCOME (LOSS) $ (15,745) $ 14,186 $ (6,022) $ 27,128
v3.24.1.1.u2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY (Unaudited) - USD ($)
Total
Preferred StockConvertible Stock 2 [Member]
Common Stock
Additional Paid-In Capital
Retained Earnings (Accumulated Deficit)
Accumulated other comprehensive loss
Balance, shares at Jun. 30, 2022   5,000 3,292,945      
Balance, amount at Jun. 30, 2022 $ 319,669 $ 50 $ 32,929 $ 21,057,116 $ (20,764,606) $ (5,820)
Net loss (854) 0 0 0 (854) 0
Foreign Currency Translation Adjustment 27,982 $ 0 $ 0 0 0 27,982
Balance, shares at Mar. 31, 2023   5,000 3,292,945      
Balance, amount at Mar. 31, 2023 34,697 $ 50 $ 32,929 21,057,116 (20,765,460) 22,162
Balance, shares at Dec. 31, 2022   5,000 3,292,945      
Balance, amount at Dec. 31, 2022 332,611 $ 50 $ 32,929 21,057,116 (20,765,607) 8,123
Net loss 147 0 0 0 147 0
Foreign Currency Translation Adjustment 14,039 $ 0 $ 0 0 0 14,039
Balance, shares at Mar. 31, 2023   5,000 3,292,945      
Balance, amount at Mar. 31, 2023 34,697 $ 50 $ 32,929 21,057,116 (20,765,460) 22,162
Balance, shares at Jun. 30, 2023   5,000 3,292,945      
Balance, amount at Jun. 30, 2023 350,779 $ 50 $ 32,929 21,057,116 (20,762,335) 23,019
Net loss 2,848 0 0 0 2,848 0
Foreign Currency Translation Adjustment (8,875) $ 0 $ 0 0 0 (8,875)
Balance, shares at Mar. 31, 2024   5,000 3,292,945      
Balance, amount at Mar. 31, 2024 344,752 $ 50 $ 32,929 21,057,116 (20,759,487) 14,144
Balance, shares at Dec. 31, 2023   5,000 3,292,945      
Balance, amount at Dec. 31, 2023 360,497 $ 50 $ 32,929 21,057,116 (20,762,007) 32,409
Net loss 2,520 0 0 0 2,520 0
Foreign Currency Translation Adjustment (18,265) $ 0 $ 0 0 0 (18,265)
Balance, shares at Mar. 31, 2024   5,000 3,292,945      
Balance, amount at Mar. 31, 2024 $ 344,752 $ 50 $ 32,929 $ 21,057,116 $ (20,759,487) $ 14,144
v3.24.1.1.u2
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)
9 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Cash flows from operating activities:    
Net Income (loss) $ 2,848 $ (854)
Adjustments to reconcile net income (loss) to net cash provided by operating activities    
Expenses paid on behalf of the company by a related party 20,850 13,550
Changes in operating assets and liabilities    
Accounts payable and accrued liabilities 775 5,825
Taxes payable 7,690 4,296
Accrued Expenses 0 0
Net cash provided by operating activities 31,358 22,817
Cash flow from financing activities:    
Repayment of related party debt (23,478) (8,866)
Repayment of long-term debt (6,930) (13,439)
Net cash used in financing activities (29,637) (22,305)
Change due to Foreign Currency Translation (1,353) 5,055
NET CHANGE IN CASH 403 5,567
Cash at beginning of period 104,836 94,216
Cash at end of period 105,239 99,783
Supplemental Disclosures of Cash Flow Information    
Cash paid for Interest 285 668
Cash paid for Income taxes $ 0 $ 0