Full Press Release Details
FRESH2 GROUP LIMITED
INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL
| Unaudited Condensed Consolidated Financial Statements | F-1 | |
| Unaudited Condensed Consolidated Balance Sheets as of December 31, 2022 and June 30, 2023 | F-2 | |
| Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss for the Six Months Ended June 30, 2022 and 2023 | F-3 | |
| Unaudited Condensed Consolidated Statements of Equity (Deficit) for the Six Months ended June 30, 2022 and 2023 | F-4 | |
| Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months ended June 30, 2022 and 2023 | F-5 | |
| Notes to Unaudited Condensed Consolidated Financial Statements | F-6 - F-33 |
FRESH2 GROUP LIMITED
(FORMERLY ANPAC BIO-MEDICAL SCIENCE CO., LTD.)
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands of Renminbi ("RMB")
and U.S. dollars ("US$"), except for number of shares and per share data)
| December 31 | June 30 | June 30 | ||||||||||
| 2022 | 2023 | 2023 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| ASSETS | ||||||||||||
| Current assets: | ||||||||||||
| Cash and cash equivalents | 16 | 495 | 68 | |||||||||
| Prepayment | 1,050 | 3,948 | 544 | |||||||||
| Accounts receivable, net | - | 270 | 37 | |||||||||
| Accounts receivable-related party | - | 11,450 | 1,579 | |||||||||
| Amounts due from related parties, net | - | 864 | 119 | |||||||||
| Inventories, net | - | 135 | 19 | |||||||||
| Other current assets, net | - | 414 | 57 | |||||||||
| Current assets held for sale | 12,633 | 9,777 | 1,348 | |||||||||
| Total current assets | 13,699 | 27,353 | 3,771 | |||||||||
| Long term -prepayment | - | 4,678 | 645 | |||||||||
| Property and equipment, net | - | 4,309 | 594 | |||||||||
| Intangible assets, net | - | 45,169 | 6,229 | |||||||||
| Goodwill | - | 36,503 | 5,034 | |||||||||
| Right of use assets | - | 223 | 31 | |||||||||
| Long-term investments, net | - | 39,783 | 5,486 | |||||||||
| Noncurrent assets held for sale | 26,770 | 20,193 | 2,785 | |||||||||
| TOTAL ASSETS. | 40,469 | 178,211 | 24,575 | |||||||||
| LIABILITIES AND EQUITY/(DEFICIT) | ||||||||||||
| Current liabilities: | ||||||||||||
| Short-term debts | 15 | 16 | 2 | |||||||||
| Accounts payable | - | 420 | 56 | |||||||||
| Advance from customers | - | 479 | 66 | |||||||||
| Amounts due to related parties | 1,214 | 592 | 82 | |||||||||
| Lease liability-current | - | 148 | 20 | |||||||||
| Accrued expenses and other current liabilities | 7,535 | 24,759 | 3,414 | |||||||||
| Current liabilities held for sale | 33,514 | 33,421 | 4,609 | |||||||||
| Total current liabilities | 42,278 | 59,835 | 8,249 | |||||||||
| Deferred tax liabilities | - | 2,938 | 405 | |||||||||
| Lease liability-non-current | - | 37 | 5 | |||||||||
| Other long-term liabilities | - | 903 | 125 | |||||||||
| Noncurrent liabilities held for sale | 7,595 | 2,434 | 336 | |||||||||
| TOTAL LIABILITIES | 49,873 | 66,147 | 9,120 | |||||||||
| Commitments and contingencies | ||||||||||||
| Shareholders' equity (deficit): | ||||||||||||
| Class A Ordinary shares ((US$ 0.01 par value per share; 2,400,000,000 shares authorized, 79,536,589 and 176,070,465 shares issued and outstanding as of December 31, 2022 and June 30, 2023, respectively) | 5,494 | 12,181 | 1,680 | |||||||||
| Class B Ordinary shares ((US$ 0.01 par value per share; 30,000,000 authorized, 3,573,100 and 3,573,100 shares issued and outstanding as of December 31, 2022 and June 30, 2023) | 240 | 240 | 33 | |||||||||
| Treasury shares (1) | ( 11,003 | ) | - | - | ||||||||
| Additional paid-in capital | 564,869 | 715,327 | 98,648 | |||||||||
| Accumulated deficit | ( 577,539 | ) | ( 648,303 | ) | ( 89,405 | ) | ||||||
| Accumulated other comprehensive income | 4,263 | 13,079 | 1,804 | |||||||||
| Total Fresh2 Group Limited shareholders' equity (deficit) | ( 13,676 | ) | 92,524 | 12,760 | ||||||||
| Non-controlling interest | 4,272 | 19,540 | 2,695 | |||||||||
| Total equity (deficit) | ( 9,404 | ) | 112,064 | 15,455 | ||||||||
| TOTAL LIABILITIES AND EQUITY (DEFICIT) | 40,469 | 178,211 | 24,575 |
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements
FRESH2 GROUP LIMITED
(FORMERLY ANPAC BIO-MEDICAL SCIENCE CO., LTD.)
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
OPERATIONS AND COMPREHENSIVE LOSS
(Amounts in thousands of RMB and US$, except
for number of shares and per share data)
| Six Months Ended June 30, | ||||||||||||
| 2022 | 2023 | 2023 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Total revenues | - | 4,936 | 681 | |||||||||
| Cost of revenues | - | ( 4,039 | ) | ( 557 | ) | |||||||
| Gross Profit | - | 897 | 124 | |||||||||
| Operating expenses: | ||||||||||||
| Selling and marketing expenses | ( 463 | ) | ( 6,070 | ) | ( 837 | ) | ||||||
| General and administrative expenses | ( 8,167 | ) | ( 35,680 | ) | ( 4,920 | ) | ||||||
| Research and development expenses | - | ( 2,303 | ) | ( 318 | ) | |||||||
| Loss from operations | ( 8,630 | ) | ( 43,156 | ) | ( 5,951 | ) | ||||||
| Non-operating income and expenses: | ||||||||||||
| Interest expense, net | ( 31 | ) | ( 309 | ) | ( 43 | ) | ||||||
| Foreign exchange loss, net | ( 513 | ) | - | - | ||||||||
| Share of net loss in equity method investments | - | ( 95 | ) | ( 13 | ) | |||||||
| Change in fair value of convertible debt | 139 | - | - | |||||||||
| Other income, net | - | 21 | 3 | |||||||||
| Loss from continuing operations before income taxes | ( 9,035 | ) | ( 43,539 | ) | ( 6,004 | ) | ||||||
| Income tax benefit | - | 79 | 11 | |||||||||
| Loss from continuing operations | ( 9,035 | ) | ( 43,460 | ) | ( 5,993 | ) | ||||||
| Loss from discontinued operations, net of taxes | ( 39,780 | ) | ( 27,945 | ) | ( 3,854 | ) | ||||||
| Net loss | ( 48,815 | ) | ( 71,405 | ) | ( 9,847 | ) | ||||||
| Net loss from discontinued operations attributable to noncontrolling interests | ( 740 | ) | ( 641 | ) | ( 88 | ) | ||||||
| Net loss attributable to ordinary shareholders | ( 48,075 | ) | ( 70,764 | ) | ( 9,759 | ) | ||||||
| Other comprehensive (loss) income, net of tax: | ||||||||||||
| Foreign currency translation differences | ( 162 | ) | 8,816 | 1,216 | ||||||||
| Total comprehensive loss | ( 48,977 | ) | ( 62,589 | ) | ( 8,631 | ) | ||||||
| Total comprehensive loss attributable to noncontrolling interests | ( 740 | ) | ( 641 | ) | ( 88 | ) | ||||||
| Total comprehensive loss attributable to ordinary shareholders | ( 48,237 | ) | ( 61,948 | ) | ( 8,543 | ) | ||||||
| Amounts attributable to ordinary shareholders: | ||||||||||||
| Net loss from continuing operations | ( 9,035 | ) | ( 43,460 | ) | ( 5,993 | ) | ||||||
| Net loss from discontinued operations | ( 39,040 | ) | ( 27,304 | ) | ( 3,766 | ) | ||||||
| Net loss attributable to ordinary shareholders | ( 48,075 | ) | ( 70,764 | ) | ( 9,759 | ) | ||||||
| Loss per Class A and B ordinary shares - basic and diluted | ||||||||||||
| Continuing operations | ( 0.38 | ) | ( 0.35 | ) | ( 0.05 | ) | ||||||
| Discontinued operations | ( 1.66 | ) | ( 0.22 | ) | ( 0.03 | ) | ||||||
| Net Loss | ( 2.04 | ) | ( 0.57 | ) | ( 0.08 | ) | ||||||
| Weighted average shares outstanding used in calculating basic and diluted loss per share | ||||||||||||
| Class A and Class B ordinary shares - basic and diluted | 23,603,709 | 124,374,140 | 124,374,140 |
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
FRESH2 GROUP LIMITED
(FORMERLY ANPAC BIO-MEDICAL SCIENCE CO., LTD.)
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
SHAREHOLDERS' EQUITY/(DEFICIT)
(Amounts in thousands of RMB and US$, except
for number of shares and per share data)
| Class A Ordinary Shares | Class B Ordinary Shares | Treasury shares | Additional Paid-in | Accumulated | Accumulated Other (Loss) | Total Fresh2 Group Limited Shareholders' Equity | Non-controlling | Total Equity | ||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Income | (Deficit) | interest | (Deficit) | |||||||||||||||||||||||||||||||||||||
| Balance at January 1, 2022 | 16,604,402 | 1,096 | 2,773,100 | 185 | - | - | 465,334 | ( 475,646 | ) | 4,532 | ( 4,499 | ) | 5,817 | 1,318 | ||||||||||||||||||||||||||||||||||
| Net loss | - | - | - | - | - | - | - | ( 48,075 | ) | - | ( 48,075 | ) | ( 740 | ) | ( 48,815 | ) | ||||||||||||||||||||||||||||||||
| Issuance of shares in private placements, net of offering costs | 14,382,693 | 961 | - | - | - | - | 30,028 | - | - | 30,989 | - | 30,989 | ||||||||||||||||||||||||||||||||||||
| Issuance shares for exercise of share option | 417,702 | 27 | - | - | - | - | ( 27 | ) | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Issuance shares reserved for convertible loan | 6,000,000 | 381 | - | - | - | - | ( 381 | ) | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Issuance shares for service | 187,094 | 13 | - | - | - | - | ( 13 | ) | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Conversion of convertible loans | - | - | - | - | - | - | 27,739 | - | - | 27,739 | - | 27,739 | ||||||||||||||||||||||||||||||||||||
| Share based compensation | - | - | - | - | - | - | 4,528 | - | - | 4,528 | - | 4,528 | ||||||||||||||||||||||||||||||||||||
| Foreign currency translation differences | - | - | - | - | - | - | - | - | ( 162 | ) | ( 162 | ) | - | ( 162 | ) | |||||||||||||||||||||||||||||||||
| Balance at June 30, 2022 (unaudited) | 37,591,891 | 2,478 | 2,773,100 | 185 | - | - | 527,208 | ( 523,721 | ) | 4,370 | 10,520 | 5,077 | 15,597 |
| Class A Ordinary Shares | Class B Ordinary Shares | Treasury shares | Additional Paid-in | Accumulated | Accumulated Other (Loss) | Total Fresh2 Group Limited Shareholders' Equity | Non-controlling | Total Equity | ||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Capital | Deficit | Income | (Deficit) | interest | (Deficit) | |||||||||||||||||||||||||||||||||||||
| Balance at January 1, 2023 | 79,536,589 | 5,494 | 3,573,100 | 240 | ( 12,492,283 | ) | ( 11,003 | ) | 564,869 | ( 577,539 | ) | 4,263 | ( 13,676 | ) | 4,272 | ( 9,404 | ) | |||||||||||||||||||||||||||||||
| Net loss | - | - | - | - | - | - | - | ( 70,764 | ) | - | ( 70,764 | ) | ( 641 | ) | ( 71,405 | ) | ||||||||||||||||||||||||||||||||
| Issuance of shares in private placements, net of offering costs | 62,885,707 | 4,355 | - | - | - | - | 77,541 | - | - | 81,896 | - | 81,896 | ||||||||||||||||||||||||||||||||||||
| Issuance shares for exercise of share options | 663,900 | 46 | - | - | - | - | 182 | - | - | 228 | - | 228 | ||||||||||||||||||||||||||||||||||||
| Issuance shares for exercise of warrants | 7,584,900 | 528 | - | - | - | - | 6,383 | - | - | 6,911 | - | 6,911 | ||||||||||||||||||||||||||||||||||||
| Issuance shares for acquisition | 31,891,652 | 2,174 | - | - | - | - | 66,788 | - | - | 68,962 | - | 68,962 | ||||||||||||||||||||||||||||||||||||
| Issuance shares for service | 3,500,000 | 243 | - | - | - | - | 6,142 | - | - | 6,385 | - | 6,385 | ||||||||||||||||||||||||||||||||||||
| Shares issued in private placement, cancelled subsequently | 2,500,000 | 178 | - | - | - | - | ( 178 | ) | - | - | - | - | - | |||||||||||||||||||||||||||||||||||
| Canceled treasure shares | ( 12,492,283 | ) | ( 837 | ) | - | - | 12,492,283 | 11,003 | ( 10,166 | ) | - | - | - | - | - | |||||||||||||||||||||||||||||||||
| Share based compensation | - | - | - | - | - | - | 3,766 | - | - | 3,766 | - | 3,766 | ||||||||||||||||||||||||||||||||||||
| Disposition of Changwei | - | - | - | - | - | - | - | - | - | - | 15,909 | 15,909 | ||||||||||||||||||||||||||||||||||||
| Foreign currency translation differences | - | - | - | - | - | - | - | - | 8,816 | 8,816 | - | 8,816 | ||||||||||||||||||||||||||||||||||||
| Balance at June 30, 2023 (unaudited) | 176,070,465 | 12,181 | 3,573,100 | 240 | - | - | 715,327 | ( 648,303 | ) | 13,079 | 92,524 | 19,540 | 112,064 | |||||||||||||||||||||||||||||||||||
| Balance at June 30, 2023 (US$) | 176,070,465 | 1,680 | 3,573,100 | 33 | - | - | 98,648 | ( 89,405 | ) | 1,804 | 12,760 | 2,695 | 15,455 |
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
FRESH2 GROUP LIMITED
(FORMERLY ANPAC BIO-MEDICAL SCIENCE CO., LTD.)
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
(Amounts in thousands of RMB and US$, except
for number of shares and per share data)
| Six Months Ended June 30, | ||||||||||||
| 2022 | 2023 | 2023 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Operating activities: | ||||||||||||
| Net loss | ( 48,815 | ) | ( 71,405 | ) | ( 9,847 | ) | ||||||
| Less: net loss from discontinued operations | ( 39,780 | ) | ( 27,945 | ) | ( 3,854 | ) | ||||||
| Net loss from continuing operations | ( 9,035 | ) | ( 43,460 | ) | ( 5,993 | ) | ||||||
| Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||||||
| Depreciation and amortization | - | 2,960 | 408 | |||||||||
| Share of net loss in equity method investments | - | 95 | 13 | |||||||||
| Share-based compensation | - | 2,872 | 396 | |||||||||
| Amortization of right of use assets | - | 68 | 9 | |||||||||
| Change in fair value of convertible debt | ( 139 | ) | - | - | ||||||||
| Deferred tax benefits | - | ( 79 | ) | ( 11 | ) | |||||||
| Changes in operating assets and liabilities: | ||||||||||||
| Prepayment | ( 9,034 | ) | ( 699 | ) | ( 96 | ) | ||||||
| Accounts receivable | - | ( 154 | ) | ( 21 | ) | |||||||
| Accounts receivable-related party | - | 962 | 133 | |||||||||
| Inventories | - | ( 129 | ) | ( 18 | ) | |||||||
| Other current assets | 658 | 742 | 102 | |||||||||
| Accounts payable | - | ( 569 | ) | ( 78 | ) | |||||||
| Advance from customers | - | 458 | 63 | |||||||||
| Accrued expenses and other current liabilities | ( 155 | ) | 1,384 | 191 | ||||||||
| Lease liabilities | - | ( 60 | ) | ( 8 | ) | |||||||
| Net cash used in operating activities - continuing operations | ( 17,705 | ) | ( 35,609 | ) | ( 4,910 | ) | ||||||
| Net cash used in operating activities -discontinued operations | ( 13,497 | ) | ( 1,669 | ) | ( 230 | ) | ||||||
| Net cash used in operating activities | ( 31,202 | ) | ( 37,278 | ) | ( 5,140 | ) | ||||||
| Investing activities: | ||||||||||||
| Purchases of property and equipment | - | ( 2,355 | ) | ( 325 | ) | |||||||
| Purchases of intangible assets | - | ( 8,980 | ) | ( 1,238 | ) | |||||||
| Cash acquired from acquisition | - | 1,130 | 156 | |||||||||
| Long-term investment | - | ( 38,106 | ) | ( 5,255 | ) | |||||||
| Net cash used in investing activities - continuing operations | - | ( 48,311 | ) | ( 6,662 | ) | |||||||
| Net cash provided by investing activities -discontinued operations | ( 817 | ) | 2,095 | 289 | ||||||||
| Net cash used in investing activities | ( 817 | ) | ( 46,216 | ) | ( 6,373 | ) | ||||||
| Financing activities: | ||||||||||||
| Proceeds from private placement | 30,989 | 81,643 | 11,259 | |||||||||
| Proceeds from exercising of warrants | - | 6,911 | 953 | |||||||||
| Proceeds from exercising of options | - | 228 | 31 | |||||||||
| Other long-term liabilities | - | 982 | 135 | |||||||||
| Payment to related parties | ( 160 | ) | ( 549 | ) | ( 76 | ) | ||||||
| Net cash provided by financing activities - continuing operations | 30,829 | 89,215 | 12,302 | |||||||||
| Net cash used in financing activities -discontinued operations | ( 1,589 | ) | ( 2,799 | ) | ( 386 | ) | ||||||
| Net cash provided by financing activities | 29,240 | 86,416 | 11,916 | |||||||||
| Effect of exchange rate changes on cash and cash equivalents | ( 362 | ) | ( 2,443 | ) | ( 337 | ) | ||||||
| Net increase (decrease) in cash and cash equivalents | ( 3,141 | ) | 479 | 66 | ||||||||
| Cash and cash equivalents at beginning of period | 3,152 | 16 | 2 | |||||||||
| Cash and cash equivalents at end of period | 11 | 495 | 68 | |||||||||
| Supplemental disclosure of non-cash activities: | - | - | - | |||||||||
| Conversion of convertible loans | 27,739 | - | - | |||||||||
| Right of use assets obtained in exchange for lease liabilities | 8,954 | - | - | |||||||||
| Receivable from issuance shares for private placement | - | 253 | 35 | |||||||||
| Issuances of shares for services | - | 6,385 | 881 | |||||||||
| Issuances of shares for acquisitions | - | 68,962 | 9,510 | |||||||||
| Additions to intangible assets through accrued expenses and other current liabilities | - | 1,851 | 255 |
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
FRESH2 GROUP LIMITED
(FORMERLY ANPAC BIO-MEDICAL SCIENCE CO., LTD.)
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
(Amounts in thousands of RMB and US$, except
for number of shares and per share data)
1. ORGANIZATION AND PRINCIPAL ACTIVITIES
Fresh2 Group Limited (Formerly AnPac Bio-Medical
Science Co., Ltd., the "Company") was incorporated in the British Virgin Islands ("the BVI") in January 2010.
The Company incorporated a new subsidiary, Fresh2 Technology Inc. ("Fresh2") on October 4, 2022. On February 1, 2023, the
Group acquired GISN (HK) LIMITED ("GISN"), a technical solution and outsourcing consulting services provider focused on the
digital, internet and Web 3 business transformation for start-ups and traditional enterprises. This acquisition is a critical initiative
for the Company to improve the efficiency of its e-commerce operations. On February 8, 2023, the Group acquired Fresh 2 Ecommerce Inc.
("Fresh2 Ecommerce"), a business-to-business e-commerce platform focused on connecting Asian food suppliers and restaurants
and other retail customers in the U.S. Fresh2 Ecommerce provides an online direct selling platform for food suppliers such as food companies,
manufacturers, agents, importers, and wholesalers to restaurants and other retail customers. On March 31, 2023, the Group closed an asset
purchase with Easy Hundred Inc. ("Easy Hundred"), a U.S.-based e-commerce startup company in the foodservice industry. On
July 17, 2023, the Group entered into a definitive Share Purchase Agreement to purchase 51% of Roxe Holding Inc. ("Roxe").
On July 27, 2023, Roxe entered into a Share Purchase Agreement with SpeedIn INC ("SpeedIn") to purchase 100% of the shares
of SpeedIn. Due to its poor operating results, on October 9, 2023, Roxe sold SpeedIn to Immensus LLC, a company owned by our CEO. On
November 4, 2023 the Company and Fresh2 Technology entered into a definitive Share Purchase Agreement to purchase 38.61% of the common
The Company and its subsidiaries (collectively,
the "Group") provides a business-to-business e-commerce platform focused on connecting Asian food suppliers and restaurants
and other retail customers in the U.S.
Effective on July 28, 2023, the Group disposed
its multi-cancer screening and detection test business (the "CDA Business") in the People's Republic of China (the "PRC"
or "China"). The Group determined that the disposal of the CDA Business met the criteria to be classified as a discontinued
operation (see Note 4) and, as a result, the CDA business's historical financial results are reflected in the Group's unaudited condensed
consolidated financial statements as a discontinued operation.
As of June 30, 2023, the details of the Group's
principal subsidiaries are as follows:
| Major subsidiaries | Percentage of Ownership | Date of Incorporation/ Acquisition | Place of Incorporation | Major Operation | ||||||
| Changhe Bio-Medical Technology (Yangzhou) Co., Ltd. | 100 | % | March 2010 | the PRC | Cancer screening and detection tests | |||||
| AnPac Bio-Medical Technology (Lishui) Co., Ltd. ("AnPac Lishui") * | 100 | % | October 2012 | the PRC | Cancer screening detection tests and device manufacturing | |||||
| AnPac Bio-Medical Technology (Shanghai) Co., Ltd.* | 100 | % | April 2014 | the PRC | Cancer screening and detection tests | |||||
| AnPac Technology USA Co., Ltd. ("AnPac US") * | 100 | % | September 2015 | the U.S. | Clinical trials for research on cancer screening and detection tests | |||||
| Lishui AnPac Medical Laboratory Co., Ltd.* | 100 | % | July 2016 | the PRC | Cancer screening and detection tests | |||||
| Shiji (Hainan) Medical Technology Ltd.* | 100 | % | March 2013 | the PRC | Cancer screening and detection research | |||||
| Shanghai Muqing AnPac Health Technology Co., Ltd. ("AnPac Muqing") (i)* | 51 | % | March 2019 | the PRC | Cancer screening and detection tests | |||||
| Anpai (Shanghai) Healthcare Management and Consulting Co., Ltd.* | 60 | % | August 15, 2021 | the PRC | Cancer screening and detection tests | |||||
| Fresh 2 Group Inc | 100 | % | December 27, 2022 | the U.S. | B2B e-commerce | |||||
| Fresh 2 Technology Inc ("Fresh2") | 100 | % | October 4, 2022 | the U.S. | B2B e-commerce | |||||
| Fresh 2 Logistics Inc. | 100 | % | February 22, 2023 | the U.S. | B2B e-commerce | |||||
| Fresh 2 HF Inc | 100 | % | February 21, 2023 | the U.S. | B2B e-commerce | |||||
| Foodbase Group Inc | 100 | % | January 19, 2023 | the U.S. | B2B e-commerce | |||||
| Fresh 2 EZ Inc | 100 | % | March 3, 2023 | the U.S. | B2B e-commerce | |||||
| Fresh 2 information Inc (ii) | 100 | % | April 12, 2023 | the U.S. | B2B e-commerce | |||||
| Fresh 2 Ecommerce ("Fresh2 Ecommerce") | 100 | % | February 8, 2023 | the U.S. | B2B e-commerce | |||||
| GISN (HK) Limited ("GISN") | 100 | % | February 1, 2023 | Hongkong, PRC, | B2B e-commerce | |||||
| Hua You Sheng Future (Beijing) Technology Co., Ltd. | 100 | % | February 1, 2023 | PRC | B2B e-commerce | |||||
| Guanshi Technology (Beijing) Co., Ltd. | 100 | % | February 1, 2023 | PRC | Software development |
| * | Subsidiaries that were sold subsequent to June 30, 2023. |
| (i) | AnPac Muqing closed business in March 2023 |
| (ii) | On April 12, 2023, the Company, through its subsidiary, Fresh 2 EZ Inc to acquire 100 % of equity interest in Fresh 2 information Inc from Roxe Holding Inc, a company controlled by Mr. Haohan Xu, with a nominal price. Fresh 2 information Inc has not begun operation yet. |
2. LIQUIDITY AND GOING CONCERN UNCERTAINTIES
The Group's principal sources of liquidity
have been cash generated from financing and operating activities. As of June 30, 2023, the Group had RMB495 (US$68) of cash and cash equivalents
and a working capital deficit of RMB34,148 (US$4,710). For the six months ended June 30, 2023, the Group incurred a loss from continuing
operations of RMB43,460(US$5,993). For the six months ended June 30, 2023, net cash used in continuing operating activities was RMB35,609
(US$4,910). The above-mentioned facts raise substantial doubt about the Group's ability to continue as a going concern. In assessing
its liquidity, management monitors and analyzes the Group's cash on-hand, its ability to generate sufficient revenue sources in
the future, and its operating and capital expenditure commitments. With respect to capital funding requirements, the Group budgeted capital
spending based on ongoing assessments of needs to maintain adequate cash. The Group intends to finance its future working capital requirements
and capital expenditures from financing activities until the Group's operating activities generate positive cash flows, if ever.
Management expects continued capital financing through debt or equity issuances to support its working capital requirements.
On September 25, 2023, the Company entered into
an agreement with an institutional investor to purchase up to US$2,000 of convertible notes, the convertible notes will be sold in two
tranches (i) US$400 (original principal amount) of convertible notes, Series C warrants to purchase 258,065 ADSs (or 5,161,300 Class A
ordinary shares) at an exercise price equal to 125% of the lower of (a) $1.86 and (b) the lowest daily volume-weighted average price ("VWAP")
for the 10 trading days prior to the exercise date and Series D warrants to purchase up to 283,688 ADSs (or 5,673,760 Class A ordinary
shares) at an exercise price equal to the lower of (x) $1.41 and (y) 75.83% of the lowest daily VWAP for the ten (10) trading days immediately
prior to the exercise date, subject to adjustment, and (ii) US$1,600 (original principal amount) of convertible notes, 20,645,160 Series
C warrants and 22,695,040 Series D warrants. The Company received the first payment of RMB1,697(US$234) from this offering, excluding
related financing costs.
The Group can make no assurances that required
financings will be available for the amounts needed, or on terms commercially acceptable to the Group, if at all. If one or all of these
events does not occur or subsequent capital raises are insufficient to bridge financial and liquidity shortfall, there would likely be
a material adverse effect on the Group and its financial statements.
The unaudited condensed consolidated financial
statements have been prepared assuming that the Group will continue as a going concern and, accordingly, do not include any adjustments
that might result from the outcome of this uncertainty.
3. SUMMARY OF PRINCIPAL ACCOUNTING POLICIES
(a) Basis of presentation