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~~June 3130, 2021

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

For the transition period from ____________ to ___________

Commission File No. 000-55319

~~PHOENIX~~Phoenix ~~RISING~~Rising ~~COMPANIES~~Companies, Inc. (Exact name of registrant as specified in its charter)

Nevada		46-1993448
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

~~Level~~641 ~~11,~~10th ~~Tower 4~~Street, ~~Puchong Financial Corporate Centre (PFCC) Jalan Puteri 1/2~~Cedartown, ~~Bandar Puteri, 47100~~

~~Puchong~~Georgia 30125, ~~Malaysia~~USA

(Address of principal executive offices, zip code)

+60 3 8600 0313

(Registrant’s telephone number, including area code)

~~________________________________________________________~~Level 11, Tower 4, Puchong Financial

Corporate Centre (PFCC)

Jalan Puteri 1/2, Bandar Puteri, 47100

Puchong, Malaysia

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered

Indicate by check mark whether the issuer (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, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (check one):

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 Exchange Act Rule 12b-2 of the Exchange Act): Yes ☐ No ☒

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ☐ No ☐

APPLICABLE ONLY TO CORPORATE ISSUERS

As of ~~May~~August 813, 2021, there were ~~136~~139,~~960~~926,~~636~~076 shares of common stock, $0.0001 par value per share, outstanding.

PHOENIX RISING COMPANIES

QUARTERLY REPORT ON FORM 10-QFOR THE PERIOD ENDED ~~MARCH~~JUNE 3130, 2021

INDEX

Index		Page
PART I. FINANCIAL INFORMATION
Item 1.	~~Condensed~~ Financial Statements.	4
	Condensed Consolidated Balance Sheets as of March 31, 2021 (unaudited) and December 31, 2020.	4
	Condensed Consolidated Balance Sheets as of June 30, 2021 (unaudited) and December 31, 2020.		4
	Condensed Consolidated Statements of Operations and Other Comprehensive Income (Loss) for the Three Months Ended March 31, 2021 and 2019 (unaudited)	5
	Condensed Consolidated Statements of Operations and Other Comprehensive Income (Loss) for the Three Months and Six Months Ended June 30, 2021 and 2020 (unaudited)		5
	Condensed Statements of Shareholders’ Equity (Deficit) for Three Months ended March 31, 2021 and 2020, and the year ended December 31, 2020 (unaudited).	6
	Condensed Consolidated Statements of Shareholders’ Equity (Deficit) for Six Months ended June 30, 2021 and 2020, and the year ended December 31, 2020 (unaudited).		6
	Condensed Consolidated Statements of Cash Flows for the Three Months ended March 31, 2021 and 2020 (unaudited).	7
	Condensed Consolidated Statements of Cash Flows for the Six Months ended June 30, 2021 and 2020 (unaudited).		7
	Notes to Condensed Financial Statements (unaudited).	8	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	16	17
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	18	21
Item 4.	Controls and Procedures.	18	21
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings.	19	22
Item 1A.	Risk Factors.	19	22
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	19	22
Item 3.	Defaults Upon Senior Securities.	19	22
Item 4.	Mine Safety Disclosures.	19	22
Item 5.	Other Information.	19	22
Item 6.	Exhibits.	20	23
Signatures		21	24

2 Table of Contents

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q of Phoenix Rising Companies, a Nevada corporation (the “Company”), contains “forward-looking statements,” as defined in the United States Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “could”, “expects”, “plans”, “intends”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of such terms and other comparable terminology. These forward-looking statements include, without limitation, statements about our market opportunity, our strategies, competition, expected activities and expenditures as we pursue our business plan, and the adequacy of our available cash resources. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Actual results may differ materially from the predictions discussed in these forward-looking statements. The economic environment within which we operate could materially affect our actual results. Additional factors that could materially affect these forward-looking statements and/or predictions include, among other things to fluctuations in commodities prices, the ability to obtain additional financing, the ability to obtain permits, licenses and approvals, as well as general industry and market conditions and growth rates and general economic conditions; and other factors discussed in the Company’s filings with the Securities and Exchange Commission (“SEC”).

Our management has included projections and estimates in this Form 10-Q, which are based primarily on management’s experience in the industry, assessments of our results of operations, discussions and negotiations with third parties and a review of information filed by our competitors with the SEC or otherwise publicly available. We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

PHOENIX RISING COMPANIES

Condensed Consolidated Balance Sheets

(Unaudited)

	March 31,			December 31,
	June 30,			December 31,
	2021			2020
ASSETS
Current Assets
Cash and cash equivalents	$	~~175~~388,~~347~~977		$	185,948
Accounts receivable, net		27,~~417~~143,~~245~~980			-
Inventory		129,~~649~~277,~~967~~703			5,309,894
Purchase deposit for inventory		1931,~~494,632~~037			4,610,015
Other current assets		10173,~~000~~801			23,349
Total Current Assets		1617,~~747~~915,~~191~~498			10,129,206
Goodwill		1,979,787			1,979,787
TOTAL ASSETS	$	1819,~~726~~895,~~978~~285		$	12,108,993
LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current Liabilities
Accounts payable	$	910,~~741~~655,~~442~~114		$	2,282,395
Accrued liabilities and other payables		~~184~~218,~~172~~691			118,994
Advance payment		-			834,595
Convertible notes, net of unamortized discounts		~~366~~536,~~820~~833			287,298
Due to related parties		~~107~~99,~~538~~588			107,538
Derivative liabilities		2311,~~282~~914,~~709~~091			16,614,368
Tax payable		3,~~472~~732			-
Total Current Liabilities		3323,~~686~~428,~~153~~049			20,245,188
Convertible notes non-current, net of unamortized discounts		~~185~~276,~~943~~466			182,057
TOTAL LIABILITIES		3323,~~872~~704,~~096~~515			20,427,245
Commitment and contingencies		-			-
COMMITMENTS AND CONTINGENCIES		-			-
SHAREHOLDERS’ DEFICIT
Preferred stock, $0.0001 par value; 15,000,000 shares authorized; no shares issued and outstanding		-			-
Series A Preferred stock, $0.0001par value; 1,500,000 shares designated; 1,500,000 shares issued and outstanding,		150			150
Series A Preferred stock, $0.0001 par value; 1,500,000 shares designated; 1,500,000 and 0 shares issued and outstanding, respectively		150			150
Common stock, $0.0001 par value; 1,000,000,000 shares authorized; 136,960,636 and 121,169,368 shares issued and outstanding, respectively		13,696			12,117
Common stock, $0.0001 par value; 1,000,000,000 shares authorized; 139,926,076 and 121,169,368 shares issued and outstanding, respectively		13,993			12,117
Additional paid-in capital		44,~~372~~580,~~041~~156			42,434,390
Subscription receivable		(24,522,000	)		(24,522,000	)
Accumulated deficit		(3423,~~830~~798,~~564~~970	)		(26,145,758	)
Accumulated other comprehensive loss		(~~178~~82,~~441~~559	)		(97,151	)
Total shareholders' deficit		(153,~~145~~809,~~118~~230	)		(8,318,252	)
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT	$	1819,~~726~~895,~~978~~285		$	12,108,993

The notes are an integral part of these unaudited consolidated financial statements.

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PHOENIX RISING COMPANIES

Condensed Consolidated Statements of Operations and Other Comprehensive Loss

(Unaudited)

	Three Months Ended
	Three months ended						Six Months Ended
	March 31,
	June 30,						June 30,
	2021			2020			2021			2020
Revenue	$	4,~~272~~192,~~841~~154		$	~~925~~4,~~657~~439,890		$	8,464,995		$	5,365,547
Cost of goods sold		4,~~254~~165,~~731~~831			~~857~~4,~~567~~369,059			8,420,562			5,226,626
Gross Profit		1826,~~110~~323			6870,~~090~~831			44,433			138,921
Operating Expenses
General and administrative		8878,~~250~~059			~~107~~2,~~408~~166,617			166,309			2,274,025
Professional fees		47132,~~885~~578			~~175~~389,~~444~~363			180,463			564,807
Total Operating Expenses		~~136~~210,~~135~~637			~~282~~2,~~852~~555,980			346,772			2,838,832
Loss from Operations		(~~118~~184,~~025~~314	)		(~~214~~2,~~762~~485,149	)		(302,339	)		(2,699,911	)
Other Income (Expense)
Other income		-			~~64,799~~-			-			64,799
Other loss		(110,~~820~~981	)		-			(12,801	)		-
Interest expense		(~~331~~288,~~840~~837	)		(75210,~~973~~504	)		(620,677	)		(286,477	)
Change in fair value of derivative liabilities		(811,~~233~~515,~~121~~726	)		(882,~~918~~870,558	)		3,282,605			(2,959,476	)
Total Other Expense		(8,566,781	)		(100,092	)
Total Other Income (Expense)		11,215,908			(3,081,062	)		2,649,127			(3,181,154	)
Loss Before Income Taxes		(8,684,806	)		(314,854	)
Income (Loss) Before Income Taxes		11,031,594			(5,566,211	)		2,346,788			(5,881,065	)
Provision for income taxes		-			(313,~~396~~138	)		-			(16,534	)
Net Loss	$	(8,684,806	)	$	(318,250	)
Net Income (Loss)	$	11,031,594		$	(5,579,349	)	$	2,346,788		$	(5,897,599	)
Other Comprehensive Loss
Dividend on Series A Preferred Stock		-			(1,999,373	)		-			(1,999,373	)
Foreign currency translation adjustments		(81,290	)		(170,808	)
Net income (loss) attributable to common stockholders	$	11,031,594		$	(7,578,722	)	$	2,346,788		$	(7,896,972	)
Total Comprehensive Loss	$	(8,766,096	)	$	(489,058	)
Other Comprehensive Income (Loss)
Basic and Diluted Loss per Common Share	$	(0.07	)	$	(0.06	)
Foreign currency translation adjustments		95,882			25,661			14,592			(145,147	)
Basic and Diluted Weighted Average Common Shares Outstanding	$	128,338,538		$	5,209,881
Total Comprehensive Income (Loss)	$	11,127,476		$	(7,553,061	)	$	2,361,380		$	(8,042,119	)
Basic Income (Loss) per Common Share	$	0.08		$	(0.33	)	$	0.02		$	(0.56	)
Diluted Loss per Common Share	$	(0.00	)	$	(0.33	)	$	(0.00	)	$	(0.56	)
Basic Weighted Average Common Shares Outstanding		136,634,606			23,070,367			136,330,560			14,140,124
Diluted Weighted Average Common Shares Outstanding		533,842,925			23,070,367			534,597,354			14,140,124

The notes are an integral part of these unaudited consolidated financial statements.

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PHOENIX RISING COMPANIES

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

(Unaudited)

~~Three~~Six ~~Months~~months ~~Ended~~ended ~~March~~June 3130, 2021

																		Accumulated
	Series A Preferred Stock				Common Stock				Additional									Other			Total
	Number of Shares		Amount		Number of Shares		Amount		Paid-in Capital			Subscriptionreceivable			AccumulatedDeficit			ComprehensiveLoss			Stockholders' Deficit
Balance - December 31, 2020		1,500,000	$	150		121,169,368	$	12,117	$	42,434,390		$	(24,522,000	)	$	(26,145,758	)	$	(97,151	)	$	(8,318,252	)
Common stock issued for conversion of debt		-		-		9,900,730		990		253,460			-			-			-			254,450
Common stock issued for exercised cashless warrant		-		-		5,890,538		589		(589	)		-			-			-			-
Resolution of derivative liabilities		-		-		-		-		1,684,780			-			-			-			1,684,780
Net loss		-		-		-		-		-			-			(8,684,806	)		-			(8,684,806	)
Other comprehensive loss		-		-		-		-		-			-			-			(81,290	)		(81,290	)
Balance - March 31, 2021		1,500,000	$	150		136,960,636	$	13,696	$	44,372,041		$	(24,522,000	)	$	(34,830,564	)	$	(178,441	)	$	(15,145,118	)
Common stock issued for conversion of debt		-		-		2,965,440		297		96,723			-			-			-			97,020
Resolution of derivative liabilities		-		-		-		-		111,392			-			-			-			111,392
Net income		-		-		-		-		-			-			11,031,594			-			11,031,594
Other comprehensive income		-		-		-		-		-			-			-			95,882			95,882
Balance - June 30, 2021		1,500,000	$	150		139,926,076	$	13,993	$	44,580,156		$	(24,522,000	)	$	(23,798,970	)	$	(82,559	)	$	(3,809,230	)

~~Three~~Six Months Ended ~~March~~June 3130, 2020

										~~Accumulated~~									Accumulated
	Common Stock				Additional					Other			Total
	Series A Preferred Stock				Common Stock					Additional						Retained			Other			Total
	Number of Shares		Amount		~~Paid-inCapital~~Number of Shares		~~RetainedEarnings~~Amount			~~ComprehensiveLoss~~Paid-inCapital			~~Stockholders’Equity~~Subscriptionreceivable			Earnings(Deficit)			ComprehensiveLoss			Stockholders'Equity
Balance - December 31, 2019		~~5,209,881~~-	$	~~521~~-	$	85,~~936~~209,~~263~~881	$	~~1,654,947~~521		$	~~(505~~8,~~976~~936,263	)	$	~~10,085,755~~-		$	1,654,947		$	(505,976	)	$	10,085,755
Net loss		-		-		-		~~(318,250~~-	)		-			~~(318,250~~	)		(318,250	)		-			(318,250	)
Other comprehensive loss		-		-		-		-			~~(170,808~~-	)		~~(170,808~~	)		-			(170,808	)		(170,808	)
Balance - March 31, 2020		~~5,209,881~~-	$	~~521~~-	$	85,~~936~~209,~~263~~881	$	~~1,336,697~~521		$	~~(676~~8,~~784~~936,263	)	$	~~9,596,697~~-		$	1,336,697		$	(676,784	)	$	9,596,697
Common stock issued for acquisition of Wandi		-		-		60,000,000		6,000			24,516,000			(24,522,000	)		-			-			-
Common stock issued for conversion of debt		-		-		1,291,868		129			394,393						-			-			394,522
Common stock issued for services		-		-		9,150,000		915			222,510						-			-			223,425
Common stock issued for services - related party		1,500,000		150		4,700,000		470			2,058,754						-			-			2,059,374
Common stock issued for Settlement of debt		-		-		2,206,619		221			110,110						-			-			110,331
Beneficial conversion feature		-		-		-		-			1,999,373						-			-			1,999,373
Deemed dividend on amortization of beneficial conversion feature on Series A Preferred shares		-		-		-		-									(1,999,373	)		-			(1,999,373	)
Net loss		-				-		-			-						(5,579,349	)		-			(5,579,349	)
Other comprehensive income		-				-		-			-						-			25,661			25,661
Balance - June 30, 2020		1,500,000	$	150		82,558,368	$	8,256		$	38,237,403		$	(24,522,000	)	$	(6,242,025	)	$	(651,123	)	$	6,830,661

The notes are an integral part of these unaudited consolidated financial statements.

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PHOENIX RISING COMPANIES

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	Three Months Ended
	Six Months Ended
	March 31,
	June 30,
	2021			2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(8,684,806	)	$	(318,250	)
Net income (loss)	$	2,346,788		$	(5,897,599	)
Adjustments to reconcile net loss to net cash used in operating activities:
Adjustments to reconcile net income (loss) to net cash from operating activities:
Depreciation		-			2349,~~513~~457
Amortization of debt discount		304,064			66,794
Stock based compensation		-			2,282,799
Change in fair value of derivative liabilities		8,233,121			88,918
Amortization of debt discount		537,600			248,678
Change in fair value of derivative liabilities		(3,282,605	)		2,959,476
Penalty interest		31,500			15,000
Changes in operating assets and liabilities:
Accounts receivable		(27,~~444~~134,~~173~~750	)		(~~888~~5,~~423~~903,391	)
Inventories		(7388,~~439,398~~461	)		(1890,~~781~~918	)
Other current assets		357,~~148,919~~631			~~797~~(69,~~182~~246	)
Accounts payable		78,~~549~~337,~~594~~298			716,~~281~~056,625
Amount due to related parties		-			24,068
Deferred revenue		(842,772	)		-
Advance payment		(841,137	)		-
Amount due to related party		-			31,568
Tax payable		3,~~511~~727			(138,~~275~~640	)
Accrued liabilities and other payable		3470,~~772~~955			6338,~~361~~019
Net cash used in operating activities		(~~135~~263,~~533~~089	)		(~~228~~418,~~612~~172	)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment		-			(9283,~~342~~032	)
Net cash used in investing activities		-			(9283,~~342~~032	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from convertible notes		125,000			90,000
Repayment of loan		-			(1,177	)
Loans from related parties		-			110,765
Proceeds from convertible notes		473,500			150,000
Repayments of loans from related parties		-			(47,545	)
Loans from related parties		-			222,298
Net cash provided by financing activities		125,000			153,220
Repayments of loans from related parties		(7,950	)		(70,574	)
Effects on changes in foreign exchange rate		(68	)		(1,182	)
Net cash provided by financing activities		465,550			300,547
Net change in cash and cash equivalents		(10,601	)		(168,916	)
Effects on changes in foreign exchange rate		568			(2,073	)
Net change in cash and cash equivalents		203,029			(202,730	)
Cash and cash equivalents - beginning of period		185,948			277,627
Cash and cash equivalents - end of period	$	~~175~~388,~~347~~977		$	~~108~~74,~~711~~897
Supplemental Cash Flow Disclosures
Cash paid for interest	$	~~27,777~~-		$	-203
Cash paid for income taxes	$	-1,824		$	~~136~~149,~~424~~500
Non-Cash Investing and Financing Activity:
Common stock issued for conversion of debt	$	1,216,276		$	-
Common stock issued for settlement of debt - related party	$	-		$	110,331
Common stock issued for exercised cashless warrant	$	589		$	-
Common stock issued for conversion of debt	$	1,425,678		$	394,393
Beneficial conversion feature	$	-		$	-
Common stock issued for exercised cashless warrant	$	721,964		$	-
Derivative liability recognized as debt discount	$	120,000		$	245,000
Beneficial conversion feature	$	-		$	1,999,373
Derivative liability recognized as debt discount	$	378,500		$	245,000
Acquisition of Motor Vehicle for hire purchase loan	$	-		$	49,424
Subscription receivable for acquisition of Wandi	$	-		$	24,522,000

The notes are an integral part of these unaudited consolidated financial statements.

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PHOENIX RISING COMPANIES

Notes to the Condensed Consolidated Financial Statements

~~March~~June 3130, 2021

Expressed in United States Dollars

(Unaudited)

NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS

Phoenix Rising Companies. (“we,” “us,” “our,” the “Company “PRCX”) is a Nevada corporation incorporated on June 25, 2012 under the name Resort Savers, Inc. On May 28, 2020, the Company’s corporate name was changed to Phoenix Rising Companies. It is based in Puchong, Malaysia. The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America, and the Company’s fiscal year end is December 31.

The Company makes investments and acquisitions into sound, transparent markets and industries throughout the world. The Company is principally engaged in the trading of oil, gas and lubricant. From January 1, 2020, the Company deconsolidated the operations in nutrition and health products.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company prepares its condensed consolidated financial statements in accordance with rules and regulations of the U.S. Securities and Exchange Commission (SEC) and generally accepted accounting principles (“GAAP”) in the United States of America. The accompanying consolidated financial statements have been prepared in accordance with GAAP for interim financial information in accordance with Article 8 of Regulation S-X and presented in United States dollars.

In the opinion of the Company’s management, the accompanying unaudited interim consolidated financial statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present the financial position of the Company as of ~~March~~June 3130, 2021 and the results of operations and cash flows for the periods presented. The results of operations for the ~~three~~six months ended ~~March~~June 3130, 2021 are not necessarily indicative of the operating results for the full fiscal year or any future period. These unaudited interim consolidated financial statements should be read in conjunction with the financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on June 1, 2021.

Principles of Consolidation

At ~~March~~June 3130, 2021, the principal subsidiaries of the Company were listed as follows:

Entity Name

AcquisitionDate

Ownership

Jurisdiction

InvestmentsHeld By

Nature ofOperation

FiscalYear

Xing Rui International Investment Holding Group Co., Ltd. (“Xing Rui”)

December 22, 2014

100

Seychelles

PRCX

Holding Company

~~December~~January 31

Xing Rui International Investment Group Ltd. (“Xing Rui HK”)

December 22, 2014

100

Hong Kong, the PRC

Xing Rui

Holding Company

~~December~~January 31

Huaxin Changrong (Shenzhen) Technology Service Co., Ltd. (“Huaxin”) *

August 27, 2015

100

the PRC

Xing Rui

Holding Company

December 31

Beijing Yandong Tieshan Oil Products Co., Ltd. (“Tieshan Oil”) *

January 29, 2016

the PRC

Huaxin

Trading of oil products

December 31

May 16, 2018

~~____________~~_______

*	The English names used are translated only.

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These condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All material intercompany balances and transactions have been eliminated upon the consolidation.

Use of Estimates and Assumptions

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. The estimates and judgments will also affect the reported amounts for certain revenues and expenses during the reporting period. Actual results could differ from these good faith estimates and judgments.

Foreign Currency Translation and Re-measurement

The Company translates its foreign operations to U.S. dollars in accordance with ASC 830, “Foreign Currency Matters”.

The Company’s functional currency and reporting currency is the U.S. dollar, and our subsidiaries’ functional currency is the Chinese Yuan Renminbi (“CNY”), and Hong Kong Dollar (“HKD”).

The Company translates the foreign subsidiaries’ records into U.S. dollar as follows:

	·	Assets and liabilities at the rate of exchange in effect at the balance sheet date
	·	Equities at historical rate
	·	Revenue and expense items at the average rate of exchange prevailing during the period

Concentrations of Credit Risk

The Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents, and accounts receivable. The Company places its cash and cash equivalents with financial institutions of high credit worthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits. The Company also reviews its accounts receivable in a timely manner. The Company’s management plans to assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposures are limited.

Tieshan Oil

During the ~~three~~six months ended ~~March~~June 3130, 2021 and 2020, two customers accounted for 100% of revenues (86% and 16%) and one customer accounted for 100% of revenues.

During the ~~three~~six months ended ~~March~~June 3130, 2021 and 2020, one vendor accounted for 100% of total purchases.

As of ~~March~~June 3130, 2021 and December 31, 2020, ~~one~~two ~~customer~~customers accounted for ~~approximately~~ 100% (82% and 18%) and 0% of accounts receivable, and ~~one~~two ~~vendor~~vendors accounted for approximately ~~100~~ 99% and ~~two vendors for~~ 96% of accounts payable, respectively.

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Earnings Per Share of Common Stock

The Company has adopted ASC Topic 260, “Earnings per Share,” (“EPS”) which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying consolidated financial statements, basic earnings per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.

~~For~~NOTE ~~the~~3 ~~three~~- ~~months~~GOING ~~ended March 31, 2021 and 2020, the following common stock equivalents were included in the computation of diluted net income per share.~~CONCERN

	Three Months Ended March 31,
	2021		2020
	(Shares)		(Shares)
Convertible notes		12,841,294		2,061,429
Warrant		240,155,431		333,398
Total		252,996,725		2,394,827

The Company’s condensed consolidated financial statements are prepared using GAAP applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet had sufficient revenues to cover its operating cost, and requires additional capital to commence its operating plan. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about its ability to continue as a going concern.

~~NOTE~~In 3order -to ~~GOING~~continue ~~CONCERN~~as a going concern, the Company will need, among other things, additional capital resources. Management’s plan to obtain such resources for the Company include: sales of equity instruments; traditional financing, such as loans; and obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.

~~The~~There ~~Company’s~~is ~~condensed~~no ~~consolidated~~assurance ~~financial~~that ~~statements~~the ~~are~~Company ~~prepared~~will ~~using~~be ~~GAAP~~able ~~applicable~~ to aobtain ~~going~~sufficient ~~concern~~additional ~~which~~funds ~~contemplates~~when ~~the~~needed ~~realization~~or ofthat ~~assets~~such ~~and~~funds, ~~liquidation~~if ofavailable, ~~liabilities~~will inbe ~~the~~obtainable ~~normal~~on ~~course~~terms ofsatisfactory ~~business.~~to ~~The~~the Company. ~~has~~In ~~not~~addition, ~~yet~~profitability ~~had~~will ~~sufficient~~ultimately ~~revenues~~depend toupon ~~cover~~the ~~its~~level ~~operating~~of ~~cost,~~revenues ~~and~~received ~~requires~~from ~~additional~~business ~~capital~~operations. toHowever, ~~commence~~there ~~its~~is ~~operating~~no ~~plan.~~assurance ~~The~~that ~~ability of~~ the Company towill ~~continue~~attain asprofitability. aThe ~~going~~accompanying ~~concern~~financial isstatements ~~dependent~~do onnot ~~the~~include ~~Company~~any ~~obtaining~~adjustments ~~adequate~~that ~~capital~~might tobe ~~fund~~necessary ~~operating~~if ~~losses until it becomes profitable. If~~ the Company is unable to ~~obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about its ability to~~ continue as a going concern.

InNOTE ~~order~~4 to– ~~continue~~ACCOUNTS as a going concern, the Company will need, among other things, additional capital resources. Management’s plan to obtain such resources for the Company include: sales of equity instruments; traditional financing, such as loans; and obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.RECEIVABLE

~~There~~The ~~is no assurance that the~~ Company ~~will~~has beperformed ~~able~~an toanalysis ~~obtain~~on ~~sufficient~~all ~~additional~~of ~~funds~~its ~~when~~accounts ~~needed~~receivable orand determined that ~~such~~all ~~funds,~~amounts ifare ~~available,~~collectible ~~will~~by ~~be obtainable on terms satisfactory to~~ the Company. InAs ~~addition~~such, ~~profitability~~all ~~will~~accounts ~~ultimately~~receivables ~~depend~~are ~~upon~~reflected ~~the~~as ~~level~~a ofcurrent ~~revenues~~asset ~~received~~and ~~from~~no ~~business~~allowance ~~operations.~~for ~~However,~~bad ~~there~~debt ishas nobeen ~~assurance~~recorded ~~that~~as ~~the~~of ~~Company~~June ~~will~~30, ~~attain~~2021 ~~profitability.~~and ~~The~~December ~~accompanying~~31, ~~financial~~2020. ~~statements~~As doat ~~not~~June ~~include~~30, ~~any~~2021 ~~adjustments~~and ~~that~~December ~~might~~31, be2020, ~~necessary if~~ the Company ishad ~~unable~~accounts toreceivable ~~continue~~of as$7,143,980 and a$0, ~~going concern~~respectively.

NOTE 45 – ~~ACCOUNTS RECEIVABLE~~INVENTORIES

~~The~~Inventories Company has performed an analysis on all of its accounts receivable and determined that all amounts are collectible by the Company. As such, all accounts receivables are reflected as a current asset and no allowance for bad debt has been recorded as of March 31, 2021 and December 31, 2020. As at ~~March~~June 3130, 2021 and December 31, 2020, ~~the~~consist ~~Company had accounts receivable~~ of ~~$2,417,245~~the ~~and $0, respectively.~~following:

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	June 30,		December 31,
	2021		2020

Finished goods	$	9,277,703	$	5,309,894

~~NOTE~~10 5Table –of ~~INVENTORIES~~Contents

~~Inventories~~NOTE at6 ~~March~~– ~~31,~~CONVERTIBLE ~~2021 and December 31, 2020 consist of the following:~~NOTE

	March 31,		December 31,
	2021		2020
Finished goods	$	12,649,967	$	5,309,894

At June 30, 2021 and December 31, 2020, convertible loans consisted of the following:

NOTE 6 – CONVERTIBLE NOTE

	June 30,			December 31,
	2021			2020
Convertible Notes - originated in November 22, 2019	$	4,064		$	4,064
Convertible Notes - issued during fiscal year 2020		605,000			893,656
Convertible Notes - issued during fiscal year 2021		513,500			-
Total convertible notes payable		1,122,564			897,720
Less: Unamortized debt discount		(309,265	)		(428,365	)
Total convertible notes		813,299			469,355
Less: current portion of convertible notes		536,833			287,298
Long-term convertible notes	$	276,466		$	182,057

AtFor ~~March~~the six months ended June 30, 2021 and 2020, the interest expense on convertible notes was $51,578 and $37,599, penalty of $31,500 and $15,000, and amortization of discount, including interest expense, of $537,600 and $248,678, respectively. As of June 30, 2021 and December 31, 2020, ~~convertible~~the ~~loans~~accrued ~~consisted~~interest ofwas ~~the~~$74,562 and ~~following:~~$54,299, respectively.

	March 31,			December 31,
	2021			2020
Convertible Notes - originated in November 22, 2019	$	4,064		$	4,064
Convertible Notes - issued during fiscal year 2020		668,000			893,656
Convertible Notes - issued during fiscal year 2021		131,000			-
Total convertible notes payable		803,064			897,720
Less: Unamortized debt discount		(250,301	)		(428,365	)
Total convertible notes		552,763			469,355
Less: current portion of convertible notes		366,820			287,298
Long-term convertible notes	$	185,943		$	182,057

Conversion

~~For~~During the ~~three~~six months ended ~~March~~June 3130, 2021 ~~and 2020~~, the ~~interest~~Company ~~expense~~converted ~~on convertible~~ notes ~~was~~with ~~$27,777~~principal ~~and~~amounts ~~$9,179,~~ and ~~amortization~~accrued ~~of discount, including~~ interest ~~expense,~~ of $~~304~~351,~~063 and $66~~470 into 12,~~794~~866,170 shares ~~respectively. As~~ of ~~March~~common ~~31,~~stock. ~~2021~~The ~~and~~corresponding ~~December~~derivative ~~31,~~liability ~~2020,~~at the ~~accrued~~date ~~interest~~of ~~was~~conversion ~~$53,281~~of ~~and~~ $541,~~299~~074,208 was ~~respectively~~credited to additional paid in capital.

~~Conversion~~Convertible Notes – Issued during the six months ended 30 June 2021

During the ~~three~~six months ended ~~March~~June 3130, 2021, the Company ~~converted~~issued ~~notes~~a ~~with~~total principal ~~amounts~~amount ~~and accrued interest~~ of $~~254~~513,~~450~~500 convertible ~~into~~note ~~9,900,730~~for ~~shares~~cash proceeds of ~~common stock~~$473,500. The ~~corresponding~~terms ~~derivative liability at the date~~ of ~~conversion~~convertible ofnote ~~$962,816~~are ~~was~~summarized ~~credited~~as ~~to additional paid in capital.~~follows:

• Term: 12 months - 18 months; • Annual interest rates: 8%; • Convertible ~~Notes~~at –the ~~Issued~~option ~~during~~of the ~~three~~holders ~~months~~at ~~ended~~any ~~March~~time ~~31,~~or ~~2021~~180 days from issuance • Conversion prices are based on discounted (35% - 40% discount) lowest trading prices of the Company’s shares during various periods prior to conversion.

~~During~~Convertible ~~the~~Notes ~~three~~– ~~months~~Issued ~~ended~~during ~~March 31, 2021,~~ the ~~Company~~year ~~issued~~ended aDecember ~~total principal amount of $131~~31,~~000 convertible~~ ~~note for cash proceeds of $125,000. The terms of convertible note are summarized as follows:~~2020

·During ~~Term:~~the 18year ~~months;~~ended ·December ~~Annual~~31, ~~interest~~2020, ~~rates:~~the ~~8%;~~Company ·issued ~~Convertible~~a attotal ~~the~~principal ~~option~~amount of ~~the~~$1,034,750 convertible ~~holders~~note atfor ~~any~~cash ~~time~~proceeds ~~after~~of ~~180~~$912,000. ~~days~~The ~~from~~terms ~~issuance;~~of ·convertible ~~Conversion~~note ~~prices~~ are ~~based~~summarized onas ~~discounted (35% discount) lowest trading prices of the Company’s shares during various periods prior to conversion.~~follows:

• Term: a range from 9 months to 18 months; • Annual interest rates: 8% - 13%; • Convertible ~~Notes~~at –the ~~Issued~~option of the holders at any time or 180 days from issuance; • Conversion prices are based on discounted (10% - 50% discount) lowest trading prices of the Company’s shares during various periods prior to conversion. • Certain note allows the ~~three~~principal ~~months~~amount ~~ended~~will ~~March~~increase 31by $15,000 ~~2020~~and the discount rate of conversion price will decrease by 20% if the conversion price is less than $0.10 or $0.01. As a result, the discount rate of conversion price changed from 50% to 70% and the Company recognized the penalty of $15,000 and recorded principal amount of $15,000.

~~During~~The ~~the~~Company ~~three~~determined ~~months~~that ~~ended~~the ~~March~~conversion ~~31,~~feature ~~2020,~~met the ~~Company~~definition ~~issued~~of a ~~total~~liability ~~principal~~in ~~amount~~accordance ofwith ~~$112~~ASC Topic No. 815-40,~~750~~ ~~convertible~~“Derivatives and Hedging - Contracts in Entity’s Own Stock” and therefore bifurcated the embedded conversion option once the note becomes convertible and accounted for ~~cash~~it ~~proceeds~~as ofa ~~$90,000~~derivative liability. The ~~terms~~fair value of ~~convertible~~the ~~note~~conversion ~~are~~feature ~~summarized~~was recorded as ~~follows:~~a debt discount and amortized to interest expense over the term of the note.

·The ~~Term:~~Company 10valued ~~months;~~the ·conversion ~~Annual~~feature ~~interest~~and ~~rates:~~warrant ~~12%;~~using ·the ~~Convertible~~Black atScholes ~~the~~valuation ~~option~~model. The fair value of the ~~holders~~derivative atliability ~~any~~for ~~time;~~all ·warrant ~~Conversion~~and ~~prices~~the ~~are~~notes ~~based~~that onbecame ~~discounted~~convertible, ~~(35%~~including -the ~~50%~~notes ~~discount)~~issued ~~lowest~~in ~~trading~~prior ~~prices~~years, during the six months ended June 30, 2021 amounted to $702,157. $378,500 of the ~~Company’s~~value ~~shares~~assigned ~~during~~to ~~various~~the ~~periods~~derivative ~~prior~~liability was recognized as a debt discount to ~~conversion~~the notes while the balance of $323,657 was recognized as a “day 1” derivative loss.

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~~The~~NOTE ~~Company~~7 ~~determined~~– that the conversion feature met the definition of a liability in accordance with ASC Topic No. 815-40, “Derivatives and Hedging - Contracts in Entity’s Own Stock” and therefore bifurcated the embedded conversion option once the note becomes convertible and accounted for it as a derivative liability. The fair value of the conversion feature was recorded as a debt discount and amortized to interest expense over the term of the note.WARRANTS

~~The~~A ~~Company~~summary ~~valued the conversion feature and warrant using the Black Scholes valuation model. The fair value~~ of ~~the~~activity ~~derivative~~regarding ~~liability~~warrants ~~for all warrant and the notes that became convertible, including the notes~~ issued ~~in prior years, during the three months ended March 31, 2021 amounted to $248,396. $120,000 of the value assigned to the derivative liability was recognized~~ as ~~a debt discount to the notes while the balance of $128,396 was recognized as a “day 1” derivative loss.~~follows:

NOTE 7 – WARRANTS

	Warrants Outstanding
				Weighted Average		Contractual life
	Shares			Exercise Price		(in years)

Outstanding, December 31, 2020		245,232,491		$	0.0069		4.35
Granted		-			-		-
Reset feature		-			-		-
Exercised		(5,077,060	)		0.0072		-
Forfeited/canceled		-			-		-
Outstanding, June 30, 2021		240,155,431		$	0.0070		3.89

Exercisable warrant at June 30, 2021		240,155,431		$	0.0069		3.89

AThe ~~summary~~Company ofdetermined ~~activity~~that ~~regarding~~the warrants ~~issued~~qualify asfor ~~follows:~~derivative accounting due to the reset feature of warrants, which led to no explicit limit to the number of shares to be delivered upon future settlement of the exercised warrants.

	Warrants Outstanding
				Weighted Average		Contractual life
	Shares			Exercise Price		(in years)
Outstanding, December 31, 2020		245,232,491		$	0.0069		4.35
Granted		-			-		-
Reset feature		-			-		-
Exercised		(5,077,060	)		0.0079		-
Forfeited/canceled		-			-		-
Outstanding, March 31, 2021		240,155,431		$	0.0068		4.14

Aggregate intrinsic value is the sum of the amounts by which the quoted market price of the Company’s stock exceeded the exercise price of the warrants at June 30, 2021 for those warrants for which the quoted market price was in excess of the exercise price (“in-the-money” warrants). The intrinsic value of the warrants as of June 30, 2021 is $9,494,256.

~~The~~NOTE ~~Company~~8 ~~determined~~– DERIVATIVE that the warrants qualify for derivative accounting due to the reset feature of warrants, which led to no explicit limit to the number of shares to be delivered upon future settlement of the exercised warrants.LIABILITIES

~~Aggregate~~The ~~intrinsic~~Company ~~value~~analyzed is the ~~sum~~conversion ofoption ~~the~~for ~~amounts~~derivative byaccounting ~~which~~consideration ~~the~~under ~~quoted~~ASC ~~market~~815, ~~price~~“Derivatives ofand ~~the~~Hedging, ~~Company’s~~and ~~stock~~hedging,” and ~~exceeded~~determined ~~the~~that ~~exercise price of~~ the ~~warrants~~instrument atshould ~~March~~be ~~31,~~classified ~~2021~~as ~~for~~a ~~those~~liability ~~warrants~~since ~~for~~the ~~which~~conversion ~~the~~option ~~quoted~~becomes ~~market~~effective ~~price~~at ~~was~~issuance resulting in ~~excess~~there ofbeing ~~the~~no ~~exercise~~explicit ~~price~~limit ~~(“in-~~to the~~-money”~~ ~~warrants).~~number ~~The~~of ~~intrinsic~~shares ~~value~~to ofbe ~~the~~delivered ~~warrants~~upon assettlement of ~~March~~the ~~31,~~above ~~2021~~conversion ~~is $22,433,306~~options.

~~NOTE~~ASC 8815 –requires ~~DERIVATIVE~~we ~~LIABILITIES~~assess the fair market value of derivative liability at the end of each reporting period and recognize any change in the fair market value as other income or expense item.

The Company ~~analyzed~~determined ~~the~~our ~~conversion~~derivative ~~option~~liabilities ~~for~~to ~~derivative~~be ~~accounting~~a ~~consideration~~Level ~~under~~3 ~~ASC~~fair ~~815,~~value ~~“Derivatives~~measurement and ~~Hedging,~~used ~~and~~the ~~hedging,”~~Black-Scholes ~~and~~pricing ~~determined~~model ~~that~~to calculate the ~~instrument~~fair ~~should~~value beas ~~classified~~of asJune a30, ~~liability~~2021. ~~since~~The Black-Scholes model requires six basic data inputs: the ~~conversion~~exercise ~~option~~or ~~becomes~~strike ~~effective~~price, attime ~~issuance~~to ~~resulting~~expiration, inthe ~~there~~risk-free ~~being~~interest norate, ~~explicit~~the ~~limit~~current tostock price, the ~~number~~estimated volatility of ~~shares~~the stock price in the future, and the dividend rate. Changes to bethese ~~delivered~~inputs ~~upon~~could ~~settlement~~produce a significantly higher or lower fair value measurement. The fair value of each convertible note and warrant is estimated using the ~~above~~Black-Scholes ~~conversion~~valuation ~~options~~model. The following weighted-average assumptions were used in the six months ended June 30, 2021 and the year ended December 31, 2020:

ASC 815 requires we assess the fair market value of derivative liability at the end of each reporting period and recognize any change in the fair market value as other income or expense item.

	Six Months Ended			Year ended
	June 30,			December 31,
	2021			2020
Expected term		0.09 - 4.47 years			0.04 - 5.00 years
Expected average volatility		166% - 363	%		175% - 494	%
Expected dividend yield		-			-
Risk-free interest rate		0.02% - 0.92	%		0.08% - 1.47	%

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The ~~Company~~following ~~determined~~table ~~our~~summarizes ~~derivative liabilities to be a Level 3 fair value measurement and used~~ the ~~Black-Scholes~~changes pricing model to calculate the fair value as of March 31, 2021. The Black-Scholes model requires six basic data inputs: the exercise or strike price, time to expiration, the risk-free interest rate, the current stock price, the estimated volatility of the stock price in the ~~future,~~derivative ~~and~~liabilities ~~the~~during ~~dividend rate. Changes to these inputs could produce a significantly higher or lower fair value measurement. The fair value of each convertible note and warrant is estimated using~~ the ~~Black-Scholes~~six ~~valuation model. The following weighted-average assumptions were used in the three~~ months ended ~~March~~June 3130, 2021 ~~and the year ended December 31, 2020~~:

	Three Months Ended			Year ended
Fair Value Measurements Using Significant Observable Inputs (Level 3)
	March 31, 2021			December 31, 2020
Balance - December 31, 2020	$	16,614,368
Expected term	0.14 - 4.47 years			0.04 - 5.00 years
Addition of new derivatives recognized as debt discounts		378,500
Expected average volatility	222% - 363%			175% - 494%
Addition of new derivatives recognized as loss on derivatives		323,657
Expected dividend yield		-			-
Settled on issuance of common stock		(1,796,172	)
Risk-free interest rate	0.01% - 0.92%			0.08% - 1.47%
Gain on change in fair value of the derivative		(3,606,262	)
Balance - June 30, 2021	$	11,914,091

The following table summarizes the ~~changes~~(gain) loss on derivative liability included in the ~~derivative~~income ~~liabilities~~statement ~~during~~for the ~~three~~six months ended ~~March~~June 3130, 2021 and 2020:, respectively.

Fair Value Measurements Using Significant Observable Inputs (Level 3)
	Six Months Ended
Balance - December 31, 2020	$	16,614,368
	June 30,
Addition of new derivatives recognized as debt discounts		120,000
	2021			2020
Addition of new derivatives recognized as loss on derivatives		128,396
Day one loss due to derivative liabilities on convertible notes	$	323,657		$	88,918
Settled on issuance of common stock		(1,684,780	)
Change in fair value of the derivative liabilities		(3,606,262	)		2,870,558
Loss on change in fair value of the derivative		8,104,725
	$	(3,282,605	)	$	2,959,476
Balance - March 31, 2021	$	23,282,709

~~The~~NOTE ~~following~~9 ~~table~~- ~~summarizes~~STOCKHOLDERS’ ~~the loss on derivative liability included in the income statement for the three months ended March 31, 2021 and 2020, respectively.~~DEFICIT

	Three Months Ended
	March 31,
	2021		2020
Day one loss due to derivative liabilities on convertible notes	$	128,396	$	88,918
Change in fair value of the derivative liabilities		8,104,725		-
	$	8,233,121	$	88,918

The capitalization of the Company consists of the following classes of capital stock as of June 30, 2021:

~~NOTE~~Preferred ~~9 - STOCKHOLDERS’ DEFICIT~~Stock

The ~~capitalization~~Company has authorized 15,000,000 shares of ~~the~~preferred ~~Company~~stock ~~consists~~with a par value of $0.0001 per share. The Board of Directors are authorized to divide the ~~following~~authorized ~~classes~~shares of ~~capital~~Preferred ~~stock~~Stock into one or more series, each of which shall be so designated as to distinguish the shares thereof from the shares of ~~March~~all ~~31,~~other ~~2021:~~series and classes. No shares of preferred stock have been issued.

Series A Preferred Stock

The Company ~~has~~is ~~authorized~~designated 15to issue 1,~~000~~500,000 shares of ~~preferred~~Series ~~stock~~A ~~with~~Preferred Stock at a par value of $0.0001 ~~per share~~. The ~~Board~~Series ofA ~~Directors~~Preferred ~~are~~Stock ~~authorized~~shall tohave ~~divide~~liquidation ~~the~~preference ~~authorized~~over ~~shares~~any ofother ~~Preferred~~class ~~Stock~~of ~~into~~stock ~~one~~and orvoting ~~more~~rights ~~series,~~on ~~each~~the basis of ~~which~~one ~~shall~~hundred bevotes sofor ~~designated~~each asshares toof ~~distinguish~~Series ~~the~~A ~~shares~~Preferred ~~thereof~~Stock. ~~from~~The ~~the~~Preferred ~~shares~~Stock ofcan ~~all~~be ~~other~~converted ~~series~~to ~~and~~common ~~classes.~~stock, Noat ~~shares~~a conversion rate of 100 common ~~preferred~~shares ~~stock~~for ~~have~~each ~~been~~preferred ~~issued~~stock.

~~Series~~As Aat ~~Preferred~~June ~~Stock~~30, 2021 and December 31, 2020, the Company had 1,500,000 preferred shares issued and outstanding.

~~The~~Common ~~Company is designated to issue 1,500,000 shares of Series A Preferred~~ Stock at a par value of $0.0001. The Series A Preferred Stock shall have liquidation preference over any other class of stock and voting rights on the basis of one hundred votes for each shares of Series A Preferred Stock. The Preferred Stock can be converted to common stock, at a conversion rate of 100 common shares for each preferred stock.

AsThe atCompany ~~March~~has 31authorized 1,000,000,000 shares ~~2021~~of ~~and~~common ~~December~~stock ~~31,~~with ~~2020,~~a par value of $0.0001 per share. Each common share entitles the ~~Company~~holder ~~had~~to 1one vote,~~500~~ in person or proxy,~~000~~ ~~preferred~~on ~~shares~~any ~~issued~~matter ~~and~~on ~~outstanding~~which action of the stockholders of the corporation is sought.

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~~Common~~During ~~Stock~~the six months ended June 30, 2021, the Company issued 18,756,708 shares of common stock as follows;

The Company has authorized 1,000,000,000 shares of common stock with a par value of $0.0001 per share. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.

	·	12,866,170 shares of common stock issued for conversion of debt of $351,470.

	·	5,890,538 shares of common stock issued for cashless exercise of warrant.

~~During~~As ~~the~~at ~~three~~June ~~months~~30, ~~ended~~2021 ~~March~~and December 31, ~~2021~~2020, the Company ~~issued 15~~had 139,~~791~~926,~~268~~ 076 shares of and 121,169,368 common ~~stock~~shares asissued ~~follows;~~and outstanding.

	·	9,900,730 shares of common stock issued for conversion of debt of $254,450.
	·	5,890,538 shares of common stock issued for cashless exercise of warrant.

Subscription receivable

AsOn atFebruary ~~March~~24, 312020, ~~2021~~the ~~and~~Company ~~December~~entered 31into a Purchase Agreement (the “Agreement”) with Mr. Liu FaKuan (“Seller”), ~~2020~~the sole owner of Henan Wandi Mining Product Development Co., Ltd. (“Wandi”), a corporation organized in the People’s Republic of China (“PRC”), pursuant to which the Company ~~had~~will ~~136~~effect an acquisition of Wandi by acquiring from the Seller all outstanding equity interests of Wandi. Wandi owns 49% of a coal mine known as You Zhou Shenhuo Kuanfa Mining Company Ltd.,~~960~~ (the “Mine”),~~636~~ ~~shares~~with ~~and~~Zhengshou ~~121~~Yshong Coal Industry Co.,~~169,368~~ ~~common~~Ltd. ~~shares~~(a ~~issued~~State-owned ~~and~~enterprise) ~~outstanding~~owning the remaining 51% of the Mine.

~~Subscription~~Pursuant ~~receivable~~to the Agreement, the Company issued 60,000,000 restricted common shares of stock of the Company to the Seller, valued at $24,522,000. The obligations of the parties to complete the acquisition is subject to the fulfillment (or, in some cases waiver) of due diligence and certain closing conditions. Upon closing of the acquisition Seller shall transfer to Company 100% of the issued and outstanding equity interests of Wandi, which will then become a wholly owned subsidiary of the Company.

OnAs ~~February~~of 24June 30, ~~2020~~2021, the Company ~~entered~~does ~~into~~not ahave ~~Purchase~~control ~~Agreement (the “Agreement”) with Mr. Liu FaKuan (“Seller”), the sole owner~~ of ~~Henan~~ Wandi ~~Mining Product Development Co~~., ~~Ltd.~~As ~~(“Wandi”),~~ a ~~corporation organized in the People’s Republic of China (“PRC”)~~result, ~~pursuant to which~~ the Company ~~will~~determined ~~effect~~not anto ~~acquisition~~consolidate of Wandi byand ~~acquiring~~recorded ~~from~~share ~~the~~issuance ~~Seller~~for ~~all~~acquisition ~~outstanding equity interests~~ of Wandi. ~~Wandi~~as ~~owns 49% of~~ a ~~coal~~subscription ~~mine~~receivable ~~known~~for ~~as You Zhou Shenhuo Kuanfa Mining Company Ltd.~~$24, ~~(the “Mine”)~~522, ~~with Zhengshou Yshong Coal Industry Co.~~000, ~~Ltd.~~until ~~(a State-owned enterprise) owning~~ the ~~remaining51%~~common shares of ~~the~~Wandi ~~Mine~~are delivered.

~~Pursuant~~NOTE to10 ~~the~~– ~~Agreement,~~RELATED ~~the~~PARTY Company issued 60,000,000 restricted common shares of stock of the Company to the Seller, valued at $24,522,000. The obligations of the parties to complete the acquisition is subject to the fulfillment (or, in some cases waiver) of due diligence and certain closing conditions. Upon closing of the acquisition Seller shall transfer to Company 100% of the issued and outstanding equity interests of Wandi, which will then become a wholly owned subsidiary of the Company.TRANSACTIONS

AsDuring ~~of March 31, 2021,~~ the ~~Company~~six ~~does~~months ~~not~~ended ~~have~~June ~~control~~30, of2021 ~~Wandi.~~and ~~As a result~~2020, the Company ~~determined~~borrowed ~~not~~$0 ~~to consolidate Wandi~~ and ~~recorded~~$222,298 ~~share~~from ~~issuance~~our ~~for~~related ~~acquisition~~parties ofand ~~Wandi~~repaid as$7,950 aand ~~subscription receivable for~~ $2470,~~522,000,~~574 ~~until~~to ~~the~~our ~~common~~related ~~shares~~parties, ~~of Wandi are delivered~~respectively.

~~NOTE~~As 10of –June ~~RELATED~~30, ~~PARTY~~2021 ~~TRANSACTIONS~~and December 31, 2020, the Company recorded amounts due to related parties of $99,588 and $107,538, respectively. The loan is non-interest bearing and due on demand.

AsNOTE of11 ~~March 31, 2021 and December 31, 2020, the Company recorded due to related parties of $107,538. The loan is non~~-~~interest~~ ~~bearing~~SEGMENTED ~~and due on demand.~~INFORMATION

~~NOTE~~At 11June -30, ~~SEGMENTED~~2021, ~~INFORMATION~~the Company operates in one industry segment, oil and gas, and two geographic segments with China being where majority current assets and equipment are located.

At ~~March~~June 3130, 2021, ~~the Company operates in one industry segment, oil~~ and ~~gas,~~December ~~and two geographic segments~~31, ~~China~~2020, ~~where~~segment ~~majority current~~ assets and ~~equipment~~liabilities ~~are~~were ~~located.~~as follows:

At March 31, 2021 and December 31, 2020, segment assets and liabilities were as follows:

June 30, 2021	Holding Company			Oil and gas		Total Consolidated
Assets
Current assets	$	1,433,754		$	16,481,744	$	17,915,498
Non-current assets		1,979,787			-		1,979,787
Liabilities
Current liabilities		12,766,858			10,661,191		23,428,049
Long term liabilities		276,466			-		276,466
Net assets	$	(9,629,783	)	$	5,820,553	$	(3,809,230	)

March 31, 2021	Holding Company			Oil and gas		Total Consolidated
Assets
Current assets	$	345,658		$	16,401,533	$	16,747,191
Non-current assets		1,979,787			-		1,979,787
Liabilities
Current liabilities		23,935,597			9,750,556		33,686,153
Long term liabilities		185,943			-		185,943
Net assets	$	(21,796,095	)	$	6,650,977	$	(15,145,118	)

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14 Table of Contents

December 31, 2020	Holding Company			Oil and gas		Total Consolidated
Assets
Current assets	$	355,490		$	9,773,716	$	10,129,206
Non-current assets		1,979,787			-		1,979,787
Liabilities
Current liabilities		17,138,155			3,107,033		20,245,188
Long term liabilities		182,057			-		182,057
Net assets	$	(14,984,935	)	$	6,666,683	$	(8,318,252	)

December 31, 2020	HoldingCompany			Oil and gas		TotalConsolidated
Assets
Current assets	$	355,490		$	9,773,716	$	10,129,206
Non-current assets		1,979,787			-		1,979,787
Liabilities
Current liabilities		17,138,155			3,107,033		20,245,188
Long term liabilities		182,057			-		182,057
Net assets	$	(14,984,935	)	$	6,666,683	$	(8,318,252	)

For the six months ended June 30, 2021 and 2020, segment revenue and net income (loss) were as follows:

For the three months ended March 31, 2021 and 2020, segment revenue and net income (loss) were as follows:

Six Months Ended June 30, 2021	Holding Company			Oil and gas			Total Consolidated
Revenue	$	-		$	8,464,995		$	8,464,995
Cost of goods sold		-			(8,420,562	)		(8,420,562	)
Operating expenses		(326,025	)		(20,747	)		(346,772	)
Other income (expenses)		2,661,928			(12,801	)		2,649,127
Provision for income taxes		-			-			-
Net income	$	2,335,903		$	10,885		$	2,346,788

Three Months Ended March 31, 2021	Holding Company			Oil and gas			Total Consolidated
Six Months Ended June 30, 2020	HoldingCompany			Oil andgas			NutritionalServices			TotalConsolidated
Revenue	$	-		$	45,~~272~~303,~~841~~166		$	462,~~272,841~~381		$	5,365,547
Cost of goods sold		-			(45,~~254~~166,~~731~~080	)		(460,~~254,731~~546	)		(5,226,626	)
Operating expenses		(~~126~~2,~~001~~659,638	)		(1022,~~134~~509	)		(~~136~~156,~~135~~685	)		(2,838,832	)
Other expenses		(8,564,961	)		(1,820	)		(8,566,781	)
Other income (expenses)		(3,245,753	)		-			64,599			(3,181,154	)
Provision for income taxes		-			-(16,534	)		-			(16,534	)
Net income (loss)	$	(85,~~690~~905,~~962~~391	)	$	698,~~156~~043		$	(890,~~684,806~~251	)	$	(5,897,599	)

Three Months Ended March 31, 2020	Holding Company			Oil and gas			Nutritional Services			Total Consolidated
Revenue	$	-		$	882,911		$	42,746		$	925,657
Cost of goods sold		-			(804,044	)		(53,523	)		(857,567	)
Operating expenses		(175,588	)		(10,946	)		(96,318	)		(282,852	)
Other income (expenses)		(164,891	)		-			64,799			(100,092	)
Provision for income taxes		-			(3,396	)		-			(3,396	)
Net income (loss)	$	(340,479	)	$	64,525		$	(42,296	)	$	(318,250	)

For the three months ended June 30, 2021 and 2020, segment revenue and net income (loss) were as follows:

NOTE 12- SUBSEQUENT EVENTS

Three Months Ended June 30, 2021	Holding Company			Oil and gas			Total Consolidated
Revenue	$	-		$	4,192,154		$	4,192,154
Cost of goods sold		-			(4,165,831	)		(4,165,831	)
Operating expenses		(200,024	)		(10,613	)		(210,637	)
Other income (expenses)		11,226,889			(10,981	)		11,215,908
Provision for income taxes		-			-			-
Net income	$	11,026,865		$	4,729		$	11,031,594

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, the Company has evaluated all events or transactions that occurred after March 31, 2021, up through the date the Company issued the unaudited condensed consolidated financial statements. During the period, the Company did not have any material recognizable subsequent events.

Three Months Ended June 30, 2020	Holding Company			Oil and gas			Nutritional Services			Total Consolidated
Revenue	$	-		$	4,420,255		$	19,635		$	4,439,890
Cost of goods sold		-			(4,362,036	)		(7,023	)		(4,369,059	)
Operating expenses		(2,484,050	)		(11,563	)		(60,367	)		(2,555,980	)
Other expenses		(3,080,862	)		-			(200	)		(3,081,062	)
Provision for income taxes		-			(13,138	)		-			(13,138	)
Net income (loss)	$	(5,564,912	)	$	33,518		$	(47,955	)	$	(5,579,349	)

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~~ITEM~~NOTE 2.12 ~~MANAGEMENT’S~~– ~~DISCUSSION~~EARNINGS ~~AND~~(LOSS) ~~ANALYSIS~~PER ~~OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.~~SHARES

~~Results~~Basic net income per common share is computed by dividing net income by the weighted average number of ~~Operations~~common shares outstanding during the periods. Diluted net income per common share is computed using the weighted average number of common and dilutive common equivalent shares outstanding during the periods. Common equivalent shares consist of convertible preferred stock and convertible notes that are computed using the if-converted method, and outstanding warrants that are computed using the treasury stock method.

Our operations for the three months ended March 31, 2021 and 2020 are outlined below:

	Three months ended						Six Months Ended
	June 30,						June 30,
	2021			2020			2021			2020
Numerator:
Net income (loss)	$	11,031,594		$	(7,578,722	)	$	2,346,788		$	(7,896,972	)
Change in fair value of derivative liabilities		(11,515,726	)		-			(3,282,605	)		-
Interest on convertible debts		(285,800	)		-			(265,803	)		-
Net income (loss) - diluted	$	(769,932	)	$	(7,578,722	)	$	(1,201,620	)	$	(7,896,972	)

Denominator:
Weighted average common shares outstanding		136,634,606			23,070,367			136,330,560			14,140,124
Effect of dilutive shares
Series A Preferred Stock		150,000,000			-			150,000,000			-
Convertible notes		30,563,831			-			27,083,110			-
Warrants		216,644,488			-			221,183,684			-
Diluted		533,842,925			23,070,367			534,597,354			14,140,124

Net income per common share:
Basic	$	0.08		$	(0.33	)	$	0.02		$	(0.56	)
Diluted	$	(0.00	)	$	(0.33	)	$	(0.00	)	$	(0.56	)

~~Three~~For the three and six months ended ~~March~~June 3130, ~~2021~~2020, ~~compared~~the toconvertible ~~three~~instruments ~~months~~are ~~ended~~anti-dilutive ~~March~~and 31therefore, ~~2020~~have been excluded from earnings (loss) per share.

	Three Months Ended
	March 31,				Change
	2021		2020		Amount
Revenue	$	4,272,841	$	925,657	$	3,347,184
Cost of Goods Sold	$	4,254,731	$	857,567	$	3,397,164
Gross profit	$	18,110	$	68,090	$	(49,980	)
Operating expenses	$	136,135	$	282,852	$	(146,717	)
Other expense	$	8,566,781	$	100,092	$	8,466,689
Provision for income taxes	$	-	$	3,396	$	(3,396	)
Net loss	$	8,684,806	$	318,250	$	8,366,556

Table of Contents

~~The~~ITEM ~~revenue for the three months ended March 31, 2021 increased by $3,347,184 to $4,272,841 compared with the same period in 2020~~2. ~~The~~MANAGEMENT’S ~~increase~~DISCUSSION isAND ~~mainly~~ANALYSIS ~~due~~OF toFINANCIAL ~~the~~CONDITION ~~effects~~AND ofRESULTS ~~COVID-19~~OF ~~causing a decrease in demand and consequently the pricing in prior period~~OPERATIONS.

~~Cost~~Results of goods sold for the three months ended March 31, 2021 increased by $3,397,164 to $4,254,731 compared with the same period in 2020. The increase is mainly due to the effects of COVID-19 causing a decrease in revenue in prior period.Operations

~~Operating~~Our ~~expenses~~operations for the three and six months ended ~~March~~June 3130, 2021 ~~decreased~~and ~~by $146,717 to $136,135 compared with the same period in~~ 2020. ~~The~~are ~~decrease~~outlined ~~is mainly due to cost control under pandemic period in operating and management expenses.~~below:

~~Other~~Three ~~expense for the three~~ months ended ~~March~~June 3130, 2021 ~~increased by $8,466,689 to $8,566,781~~ compared ~~with the same period in 2020. The increase is mainly due~~ to ~~change~~three inmonths ~~fair~~ended ~~value~~June of30, ~~derivative liabilities related to convertible notes.~~2020

Net loss for the three months ended March 31, 2021 was $8,684,806 compared to $318,250 in the same period in 2020. The change is mainly due to an increase in other expense.

	Three months ended
	June 30,					Change
	2021		2020			Amount
Revenue	$	4,192,154	$	4,439,890		$	(247,736	)
Cost of goods sold	$	4,165,831	$	4,369,059		$	(203,228	)
Gross profit (loss)	$	26,323	$	70,831		$	(44,508	)
Operating expenses	$	210,637	$	2,555,980		$	(2,345,343	)
Other income (expense)	$	11,215,908	$	(3,081,062	)	$	14,296,970
Provision for income taxes	$	-	$	13,138		$	(13,138	)
Net income (loss)	$	11,031,594	$	(5,579,349	)	$	16,610,943

~~For~~The revenue for the three months ended ~~March~~June 3130, 2021 ~~and~~decreased ~~2019~~by ~~our~~$247,736 ~~results~~to of$4,192,154 ~~operations~~compared ~~segment,~~with ~~are~~the assame ~~follows:~~period in 2020.

Three Months Ended March 31, 2021	Holding Company			Oil and gas			Total Consolidated
Revenue	$	-		$	4,272,841		$	4,272,841
Cost of goods sold		-			(4,254,731	)		(4,254,731	)
Operating expenses		(126,001	)		(10,134	)		(136,135	)
Other expenses		(8,564,961	)		(1,820	)		(8,566,781	)
Provision for income taxes		-			-			-
Net income (loss)	$	(8,690,962	)	$	6,156		$	(8,684,806	)

Cost of goods sold for the three months ended June 30, 2021 decreased by $203,228 to $4,165,831 compared with the same period in 2020.

16Operating ~~Table~~expenses offor ~~Contents~~the three months ended June 30, 2021 decreased by $2,345,343 to $210,637 compared with the same period in 2020. The decrease is mainly due to stock-based compensation for management fee in 2020.

Three Months Ended March 31, 2020	Holding Company			Oil and gas			Nutritional Services			Total Consolidated
Revenue	$	-		$	882,911		$	42,746		$	925,657
Cost of goods sold		-			(804,044	)		(53,523	)		(857,567	)
Operating expenses		(175,588	)		(10,946	)		(96,318	)		(282,852	)
Other income (expenses)		(164,891	)		-			64,799			(100,092	)
Provision for income taxes		-			(3,396	)		-			(3,396	)
Net income (loss)	$	(340,479	)	$	64,525		$	(42,296	)	$	(318,250	)

Other income for the three months ended June 30, 2021 mainly consisted of gain on change in fair value of derivative liabilities of $11,515,726, whereas other expenses for the three months ended June 30, 2020 mainly consisted of loss on change in fair value of derivative liabilities of $2,870,558. The change in fair value of derivative liabilities is related to convertible notes.

~~Holding~~Net ~~Company~~income for the three months ended June 30, 2021 was $11,031,594 compared to net loss of $5,579,349 in the same period in 2020. The change is mainly due to other income.

	Three Months Ended
	March 31,						Change
	2021			2020			Amount
Revenue	$	-		$	-		$	-
Operating expenses	$	126,001		$	175,588		$	(49,587	)
Other expense	$	8,564,961		$	164,891		$	8,400,070
Provision for income taxes	$	-		$	-		$	-
Net loss	$	(8,690,962	)	$	(340,479	)	$	(8,350,483	)

For the three months ended June 30, 2021 and 2020 our results of operations segment, are as follows:

Operating expense mainly consists of professional fees for ongoing regulatory requirements and compensation for our management.

Three Months Ended June 30, 2021	Holding Company			Oil and gas			Total Consolidated
Revenue	$	-		$	4,192,154		$	4,192,154
Cost of goods sold		-			(4,165,831	)		(4,165,831	)
Operating expenses		(200,024	)		(10,613	)		(210,637	)
Other income (expenses)		11,226,889			(10,981	)		11,215,908
Provision for income taxes		-			-			-
Net income (loss)	$	11,026,865		$	4,729		$	11,031,594

~~Other~~17 ~~expense~~Table ~~mainly consists~~ of ~~interest expense and change in fair value of derivative liability from convertible notes.~~Contents

Oil and Gas

Three Months Ended June 30, 2020	Holding Company			Oil and gas			Nutritional Services			Total Consolidated
Revenue	$	-		$	4,420,255		$	19,635		$	4,439,890
Cost of goods sold		-			(4,362,036	)		(7,023	)		(4,369,059	)
Operating expenses		(2,484,050	)		(11,563	)		(60,367	)		(2,555,980	)
Other income (expenses)		(3,080,862	)		-			(200	)		(3,081,062	)
Provision for income taxes		-			(13,138	)		-			(13,138	)
Net income (loss)	$	(5,564,912	)	$	33,518		$	(47,955	)	$	(5,579,349	)

	Three Months Ended
	March 31,				Change
	2021		2020		Amount
Revenue	$	4,272,841	$	882,911	$	3,389,930
Cost of goods sold	$	4,254,731	$	804,044	$	3,450,687
Gross profit	$	18,110	$	78,867	$	(60,757	)
Operating expenses	$	10,134	$	10,946	$	(812	)
Other expense	$	1,820	$	-	$	1,820
Provision for income taxes	$	-	$	3,396	$	(3,396	)
Net income	$	6,156	$	64,525	$	(58,369	)

Holding Company

The increase in revenue is primarily due to the COVID-19 lockdown in 2020. The increase in cost of goods sold is primarily due to an increase in revenue. The percentage of gross profit decreased from 8.9% in 2020 to 0.4% in 2020.

	Three months ended
	June 30,					Change
	2021		2020			Amount
Revenue	$	-	$	-		$	-
Cost of goods sold	$	-	$	-		$	-
Gross profit	$	-	$	-		$	-
Operating expenses	$	200,024	$	2,484,050		$	(2,284,026	)
Other income (expense)	$	11,226,889	$	(3,080,862	)	$	14,307,751
Provision for income taxes	$	-	$	-		$	-
Net income (loss)	$	11,026,865	$	(5,564,912	)	$	(16,591,777	)

17Operating ~~Table~~expense mainly consists of ~~Contents~~professional fees for ongoing regulatory requirements and compensation for our management. The decrease in operating expenses is primarily due to stock-based compensation for management fee in 2020.

~~Liquidity~~Other income (expense) mainly consists of interest expense and ~~Capital~~change ~~Resources~~in fair value of derivative liability from convertible notes.

~~The~~Oil ~~following table provides selected financial data about our Company as of March 31, 2021~~ and ~~December 31, 2020, respectively.~~Gas

Working Capital

	Three months ended
	June 30,					Change
	2021			2020		Amount
Revenue	$	4,192,154		$	4,420,255	$	(228,101	)
Cost of goods sold	$	4,165,831		$	4,362,036	$	(196,205	)
Gross profit	$	26,323		$	58,219	$	(31,896	)
Operating expenses	$	10,613		$	11,563	$	(950	)
Other income (expense)	$	(10,981	)	$	-	$	(10,981	)
Provision for income taxes	$	-		$	13,138	$	(13,138	)
Net income	$	4,729		$	33,518	$	(28,789	)

The ~~following~~decrease ~~table~~in ~~provides~~cost ~~selected~~of ~~financial~~goods ~~data~~sold ~~about~~is ~~our~~primarily ~~Company~~due asto a decrease in revenue. The percentage of ~~March~~gross ~~31,~~profit ~~2021~~decreased ~~and~~from ~~December~~1.3% ~~31,~~in 2020, ~~respectively~~to 0.6% in 2021.

	March 31,			December 31,			Change
	2021			2020			Amount
Cash	$	175,347		$	185,948		$	(10,601	)
Current Assets	$	16,747,191		$	10,129,206		$	6,617,985
Current Liabilities	$	33,686,153		$	20,245,188		$	13,440,965
Working Capital Deficiency	$	(16,938,962	)	$	(10,115,982	)	$	(6,822,980	)

Table of Contents

~~The~~ Six ~~increase~~months inended ~~working~~June ~~capital~~30, ~~deficiency~~2021 ~~was~~compared ~~primarily attributed~~ to ansix ~~increase~~months inended ~~current~~June ~~liabilities~~30, offset by an increase in current assets. The increase in current assets was primarily attributed to an increase in accounts receivable and inventories. The increase in current liabilities was primarily attributed to an increase in accounts payable and derivative liabilities.2020

Cash Flow

	Six Months Ended
	June 30,					Change
	2021		2020			Amount
Revenue	$	8,464,995	$	5,365,547		$	3,099,448
Cost of Goods Sold	$	8,420,562	$	5,226,626		$	3,193,936
Gross profit	$	44,433	$	138,921		$	(94,488	)
Operating expenses	$	346,772	$	2,838,832		$	(2,492,060	)
Other income (expense)	$	2,649,127	$	(3,181,154	)	$	5,830,281
Provision for income taxes	$	-	$	(16,534	)	$	16,534
Net income (loss)	$	2,346,788	$	(5,897,599	)	$	8,244,387

	Three Months Ended
	March 31,						Change
	2021			2020			Amount
Cash Flows used in operating activities	$	(135,533	)	$	(228,612	)	$	93,079
Cash Flows used in investing activities	$	-		$	(92,342	)	$	92,342
Cash Flows provided by financing activities	$	125,000		$	153,220		$	(28,220	)
Effects on changes in foreign exchange rate	$	(68	)	$	(1,182	)	$	1,114
Net change in cash during period	$	(10,601	)	$	(168,916	)	$	158,315

The revenue for the six months ended June 30, 2021 increased by $3,099,448 to $8,464,995 compared with the same period in 2020. The increase is mainly due to the effects of COVID-19 causing a decrease in demand and consequently the pricing in prior period.

~~Cash~~Cost ~~Flow~~of goods sold for the six months ended June 30, 2021 increased by $3,193,936 to $8,420,562 compared with the same period in 2020. The increase is mainly due to the effects of COVID-19 causing a decrease in revenue in prior period. The gross profit, nevertheless, has decreased due to the reduction in margin from ~~Operating~~2.6% ~~Activities~~for the six month period ended June 30, 2020 to 0.5% for the same period in 2021.

~~During~~Operating expenses for the ~~three~~six months ended ~~March~~June 3130, 2021, ~~our~~decreased ~~Company~~by ~~used~~ $~~135~~2,~~533 in operating activities~~492,060 ~~compared~~ to $~~228~~346,~~612~~772 ~~during~~compared with the ~~three~~same ~~months~~period ~~ended~~in ~~March 31,~~ 2020. The decrease inis ~~cash~~mainly ~~used~~due into ~~operation~~stock-based ~~activities~~compensation isfor ~~primarily~~management ~~due~~fee toin a2020 ~~decrease~~and cost control under pandemic period in operating ~~expenses~~.

~~Cash~~Other ~~Flow~~income ~~from~~for ~~Investing~~the ~~Activities~~six months ended June 30, 2021 mainly consisted of gain on change in fair value of derivative liabilities of $3,282,605 offset by interest expense of $620,677, whereas other expenses for the six months ended June 30, 2020 mainly consisted of loss on change in fair value of derivative liabilities of $2,959,476 and interest expense of $286,477. The change in fair value of derivative liabilities is related to convertible notes.

~~During~~Net income for the ~~three~~six months ended ~~March~~June 3130, 2021, wewas ~~did~~$2,346,788 ~~not~~compared ~~have~~to ~~any~~net ~~investing~~loss ~~activities.~~of ~~For~~$5,897,599 in the ~~three~~same ~~months~~period ~~ended~~in ~~March~~2020. ~~31,~~The ~~2020,~~change weis ~~used~~mainly ~~$92,342~~due ~~for~~to ~~purchase~~an ofincrease ~~property~~in other income and ~~equipment.~~a decrease in operating expenses.

~~Cash~~For ~~Flow~~the ~~from~~six ~~Financing~~months ~~Activities~~ended June 30, 2021 and 2019 our results of operations segment, are as follows:

During the three months ended March 31, 2021 and 2020, our Company received $125,000 and $153,220 from financing activities, respectively. For the three months ended March 31, 2021, the Company received $125,000 from the issuance of convertible notes. For the three months ended March 31, 2020, the Company received $90,000 from the issuance of convertible notes and $110,765 from loans from related parties, and repaid loans from related parties for $47,545.

Six Months Ended June 30, 2021	Holding Company			Oil and gas			Total Consolidated
Revenue	$	-		$	8,464,995		$	8,464,995
Cost of goods sold		-			(8,420,562	)		(8,420,562	)
Operating expenses		(326,025	)		(20,747	)		(346,772	)
Other income (expenses)		2,661,928			(12,801	)		2,649,127
Provision for income taxes		-			-			-
Net income	$	2,335,903		$	10,885		$	2,346,788

Critical Accounting Policies and Estimates

Six Months Ended June 30, 2020	Holding Company			Oil and gas			Nutritional Services			Total Consolidated
Revenue	$	-		$	5,303,166		$	62,381		$	5,365,547
Cost of goods sold		-			(5,166,080	)		(60,546	)		(5,226,626	)
Operating expenses		(2,659,638	)		(22,509	)		(156,685	)		(2,838,832	)
Other income (expenses)		(3,245,753	)		-			64,599			(3,181,154	)
Provision for income taxes		-			(16,534	)		-			(16,534	)
Net income (loss)	$	(5,905,391	)	$	98,043		$	(90,251	)	$	(5,897,599	)

~~The~~19 ~~preparation~~Table of condensed consolidated financial statements and related disclosures in conformity with U.S. generally accepted accounting principles and the Company’s discussion and analysis of its financial condition and operating results require the Company’s management to make judgments, assumptions and estimates that affect the amounts reported. Management bases its estimates on historical experience and on various other assumptions it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates, and such differences may be material.Contents

~~Off-Balance~~Holding ~~Sheet Arrangements~~Company

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

	Six Months Ended
	June 30,					Change
	2021		2020			Amount
Revenue	$	-	$	-		$	-
Cost of goods sold	$	-	$	-		$	-
Gross profit	$	-	$	-		$	-
Operating expenses	$	326,025	$	2,659,638		$	(2,333,613	)
Other income (expense)	$	2,661,928	$	(3,245,753	)	$	5,907,681
Provision for income taxes	$	-	$	-		$	-
Net income (loss)	$	2,335,903	$	(5,905,391	)	$	8,241,294

~~ITEM~~Operating 3expense mainly consists of professional fees for ongoing regulatory requirements and compensation for our management. ~~QUANTITATIVE~~The ~~AND~~decrease ~~QUALITATIVE~~in ~~DISCLOSURES~~operating ~~ABOUT~~expenses ~~MARKET~~is ~~RISK~~primarily due to stock-based compensation for management fee in 2020.

AsOther aincome ~~smaller reporting company~~ (asexpense) ~~defined~~mainly inconsists ~~Rule 12b-2~~ of ~~the~~interest ~~Exchange~~expense ~~Act),~~and wechange ~~are~~in ~~not~~fair ~~required~~value toof ~~provide~~derivative ~~the~~liability ~~information~~from ~~called~~convertible ~~for by this Item 3~~notes.

~~ITEM~~Oil 4.and ~~CONTROLS AND PROCEDURES.~~Gas

Evaluation of Disclosure Controls and Procedures

	Six Months Ended
	June 30,				Change
	2021		2020		Amount
Revenue	$	8,464,995	$	5,303,166	$	3,161,829
Cost of goods sold	$	8,420,562	$	5,166,080	$	3,254,482
Gross profit	$	44,433	$	137,086	$	(92,653	)
Operating expenses	$	20,747	$	22,509	$	(1,762	)
Other expense	$	12,801	$	-	$	12,801
Provision for income taxes	$	-	$	16,534	$	(16,534	)
Net income	$	10,885	$	98,043	$	(87,158	)

~~Our~~The ~~management,~~increase ~~with the participation of our Chief Executive Officer and out Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as defined~~ in ~~Rule~~revenue ~~13a-15(e)~~is ~~under~~primarily ~~the~~due ~~Exchange~~to ~~Act as of~~ the ~~end of the period covered by this Quarterly Report on Form 10~~COVID-Q.19 Inlockdown ~~designing~~in and evaluating the disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives2020. InThe ~~addition,~~increase ~~the~~in ~~design~~cost of ~~disclosure~~goods ~~controls~~sold ~~and procedures must reflect the fact that there are resource constraints and that management~~ is ~~required~~primarily due to ~~apply~~an ~~its~~increase ~~judgment~~ in ~~evaluating the benefits of possible controls and procedures relative to their costs~~revenue. The ~~design~~percentage of ~~any~~gross ~~disclosure~~profit ~~controls~~decreased ~~and~~from ~~procedures~~2.6% ~~also is based~~ in ~~part~~2020 ~~upon~~to ~~certain~~0.5% ~~assumptions about the likelihood of future events and there can be no assurance that any design will succeed~~ in ~~achieving its stated goals under all potential future conditions~~2021.

~~Based~~Liquidity ~~on that evaluation, our Chief Executive Officer~~ and ~~our~~Capital Chief Financial Officer concluded that, as of March 31, 2021, our disclosure controls and procedures were not effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is (i) recorded, processed, summarized and reported within the time periods specified in SEC rules, regulations and forms, and (ii) that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Resources

~~Changes~~The infollowing ~~Internal~~table ~~Control~~provides ~~Over~~selected ~~Financial~~financial ~~Reporting~~data about our Company as of June 30, 2021 and December 31, 2020, respectively.

~~Our~~Working management, with the participation of our Chief Executive Officer and our Chief Financial Officer, has concluded there were no significant changes in our internal controls over financial reporting that occurred during this quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.Capital

18The ~~Table~~following table provides selected financial data about our Company as of ~~Contents~~June 30, 2021 and December 31, 2020, respectively.

PART II. OTHER INFORMATION

	June 30,			December 31,			Change
	2021			2020			Amount
Cash	$	388,977		$	185,948		$	203,029

Current Assets	$	17,915,498		$	10,129,206		$	7,786,292
Current Liabilities	$	23,428,049		$	20,245,188		$	3,182,861
Working Capital Deficiency	$	(5,512,551	)	$	(10,115,982	)	$	4,603,431

~~ITEM~~The 1decrease in working capital deficiency was primarily attributed to an increase in current assets offset by an increase in current liabilities. ~~LEGAL~~The ~~PROCEEDINGS~~increase in current assets was primarily attributed to an increase in accounts receivable and inventories. The increase in current liabilities was primarily attributed to an increase in accounts payable offset by a decrease in derivative liabilities.

~~The~~20 ~~Company~~Table is not currently subject to any legal proceedings. From time to time, the Company may become subject to litigation or proceedings in connection with its business, as either a plaintiff or defendant. There are no such pending legal proceedings to which the Company is a party that, in the opinion of ~~management, is likely to have a material adverse effect on the Company’s business, financial condition or results of operations.~~Contents

~~ITEM~~Cash ~~1A. RISK FACTORS~~Flow

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 1A.

	Six Months Ended
	June 30,						Change
	2021			2020			Amount
Cash Flows used in operating activities	$	(263,089	)	$	(418,172	)	$	155,083
Cash Flows used in investing activities	$	-		$	(83,032	)	$	83,032
Cash Flows provided by financing activities	$	465,550		$	300,547		$	165,003
Effects on changes in foreign exchange rate	$	568		$	(2,073	)	$	2,641
Net change in cash during period	$	203,029		$	(202,730	)	$	405,759

~~ITEM~~Cash 2.Flow ~~UNREGISTERED~~from ~~SALES~~Operating ~~OF EQUITY SECURITIES AND USE OF PROCEEDS.~~Activities

~~None~~During the six months ended June 30, 2021, our Company used $263,089 in operating activities, compared to $418,172 during the six months ended June 30, 2020. The decrease in cash used in operation activities is primarily due to a decrease in operating expenses.

~~ITEM~~Cash 3.Flow ~~DEFAULTS~~from ~~UPON~~Investing ~~SENIOR SECURITIES.~~Activities

~~None~~During the six months ended June 30, 2021, we did not have any investing activities. For the six months ended June 30, 2020, we used $83,032 for purchase of property and equipment.

~~ITEM~~Cash 4.Flow ~~MINE~~from ~~SAFETY~~Financing ~~DISCLOSURES.~~Activities

~~None~~During the six months ended June 30, 2021 and 2020, our Company received $465,550 and $300,547 from financing activities, respectively. For the six months ended June 30, 2021, the Company received $473,500 from the issuance of convertible notes and repaid loans from related parties of $7,950. For the six months ended June 30, 2020, the Company received $150,000 from the issuance of convertible notes and $222,298 from loans from related parties, and repaid loans from related parties for $70,574 and hire purchase loan of $1,177.

~~ITEM~~Critical 5.Accounting ~~OTHER~~Policies ~~INFORMATION.~~and Estimates

~~None~~The preparation of condensed consolidated financial statements and related disclosures in conformity with U.S. generally accepted accounting principles and the Company’s discussion and analysis of its financial condition and operating results require the Company’s management to make judgments, assumptions and estimates that affect the amounts reported. Management bases its estimates on historical experience and on various other assumptions it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates, and such differences may be material.

19Off-Balance ~~Table~~Sheet ~~of Contents~~Arrangements

~~ITEM~~We 6.do ~~EXHIBITS~~not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

~~(a)~~ITEM ~~The~~3. ~~following~~QUANTITATIVE ~~Exhibits,~~AND asQUALITATIVE ~~required~~DISCLOSURES byABOUT ~~Item~~MARKET ~~601 of Regulation SK, are attached or incorporated by reference, as stated below~~RISK.

Number		Description
3.1.1		Articles of Incorporation (1)
3.1.2		Certificate of Amendment (2)
3.1.2		Certificate of Amendment (4)
3.2		Amended and Restated Bylaws (3)
31.1		Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1		Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
32.2		Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
101.INS		XBRL Instance Document*+
101.SCH		XBRL Taxonomy Extension Schema Document*+
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document*+
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document*+
101.LAB		XBRL Taxonomy Extension Label Linkbase Document*+
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document*+

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 3.

~~_______________~~ITEM 4. CONTROLS AND PROCEDURES.

(1)	Incorporated by reference to the Registrant’s Registration Statement on Form S-1 (File No. 333-187437), filed with the Securities and Exchange Commission on March 22, 2019.
(2)	Incorporated by reference to the Registrant’s Annual Report on Form 10-K (File No. 001-55319), filed with the Securities and Exchange Commission on May 13, 2016.
(3)	Incorporated by reference to the Registrant’s Current Report on Form 8-K (File No. 001-55319), filed with the Securities and Exchange Commission on July 9, 2018.
(4)	Incorporated by reference to the Registrant’s Annual Report on Form 10-K (File No. 001-55319), filed with the Securities and Exchange Commission on June 1, 2021.

Evaluation of Disclosure Controls and Procedures

*FiledOur ~~herewith~~management, with the participation of our Chief Executive Officer and out Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15(e) under the Exchange Act as of the end of the period covered by this Quarterly Report on Form 10-Q. In designing and evaluating the disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

+Based ~~XBRL~~on ~~(Extensible~~that ~~Business~~evaluation, ~~Reporting~~our ~~Language)~~Chief ~~information~~Executive isOfficer ~~furnished~~and our Chief Financial Officer concluded that, as of June 30, 2021, our disclosure controls and procedures were not ~~filed~~effective orto aprovide ~~part~~reasonable ofassurance athat ~~registration~~information ~~statement~~we orare ~~prospectus~~required ~~for~~to ~~purposes~~disclose ofin ~~Sections~~reports 11that we file or 12submit ofunder the ~~Securities~~Exchange Act ofis ~~1933~~(i) recorded, ~~as amended~~processed, issummarized ~~deemed~~and ~~not~~reported ~~filed~~within ~~for~~the ~~purposes~~time ofperiods ~~Section~~specified 18in ofSEC ~~the~~rules, ~~Securities~~regulations ~~Exchange~~and ~~Act~~forms, ofand ~~1934,~~(ii) asthat ~~amended~~such information is accumulated and communicated to our management, including our Chief Executive Officer and ~~otherwise~~Chief isFinancial ~~not~~Officer, ~~subject~~as appropriate, to ~~liability~~allow ~~under~~timely ~~these~~decisions ~~sections~~regarding required disclosure.

20Changes ~~Table~~in ofInternal ~~Contents~~Control Over Financial Reporting

~~SIGNATURES~~Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, has concluded there were no significant changes in our internal controls over financial reporting that occurred during this quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

~~Pursuant~~21 toTable ~~the requirements~~ of ~~the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.~~Contents

	PHOENIX RISING COMPANIES
Date: June 9, 2021	By:	/s/ Ding-Shin “DS” Chang
	Name:	Ding-Shin “DS” Chang
	Title:	President and Chief Executive Officer(principal executive officer)

PART II. OTHER INFORMATION

Date: June 9, 2021	By:	/s/ Boon Jin “Patrick” Tan
	Name:	Boon Jin “Patrick” Tan
	Title:	Chief Financial Officer (principal accounting officer and principal financial officer)

ITEM 1. LEGAL PROCEEDINGS.

21The Company is not currently subject to any legal proceedings. From time to time, the Company may become subject to litigation or proceedings in connection with its business, as either a plaintiff or defendant. There are no such pending legal proceedings to which the Company is a party that, in the opinion of management, is likely to have a material adverse effect on the Company’s business, financial condition or results of operations.

ITEM 1A. RISK FACTORS

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 1A.

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.

Table of Contents

ITEM 6. EXHIBITS.

(a) The following Exhibits, as required by Item 601 of Regulation SK, are attached or incorporated by reference, as stated below.

Number		Description

3.1.1		Articles of Incorporation (1)
3.1.2		Certificate of Amendment (2)
3.1.2		Certificate of Amendment (4)
3.2		Amended and Restated Bylaws (3)
31.1		Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
31.2		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*
32.1		Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
32.2		Certification of Principal Financial Officer 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).*+

_______________

(1)	Incorporated by reference to the Registrant’s Registration Statement on Form S-1 (File No. 333-187437), filed with the Securities and Exchange Commission on March 22, 2019.
(2)	Incorporated by reference to the Registrant’s Annual Report on Form 10-K (File No. 001-55319), filed with the Securities and Exchange Commission on May 13, 2016.
(3)	Incorporated by reference to the Registrant’s Current Report on Form 8-K (File No. 001-55319), filed with the Securities and Exchange Commission on July 9, 2018.
(4)	Incorporated by reference to the Registrant’s Annual Report on Form 10-K (File No. 001-55319), filed with the Securities and Exchange Commission on June 1, 2021.

*Filed herewith.

+ XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	PHOENIX RISING COMPANIES

Date: August 17, 2021	By:	/s/ Ding-Shin “DS” Chang
	Name:	Ding-Shin “DS” Chang
	Title:	President and Chief Executive Officer (principal executive officer)

Date: August 17, 2021

By:

/s/ Boon Jin “Patrick” Tan

Name:

Boon Jin “Patrick” Tan

Title:

Chief Financial Officer

(principal accounting officer and principal financial officer)

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