AQLS 10-Q Quarter ended June 30, 2021

U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

Mark One

For the quarterly period ended June 30, 2021

For the transition period from ______ to _______

Commission File No. 333-252535

Nevada

(State or other jurisdiction of incorporation)

5099

(Primary Standard Industrial Classification Code Number)

98-1511882

(IRS Employer Identification No.)

V Osikách, 24, Dolni Mecholupy

Prague, Czechia 10900

Tel: (702) 703-6003

(Address and telephone number of registrant's principal executive offices)

Indicate by checkmark whether the issuer: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 is a large accelerated filed, an accelerated filer, a non-accelerated filer, or a smaller reporting 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 to Section 7(a)(2)(B) of the Securities Act: ☐ 

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

Applicable Only to Issuer Involved in Bankruptcy Proceedings During the Preceding Five Years. N/A

Indicate by checkmark whether the issuer has filed all documents and reports required to be filed by Section 12, 13 and 15(d) of the Securities Exchange Act of 1934 after the distribution of securities under a plan confirmed by a court. Yes ☐     No ☐

Applicable Only to Corporate Registrants

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the most practicable date:

PART I. FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS (UNAUDITED)

The accompanying notes are an integral part of these financial statements.

AZZURRO SOLUTIONS CORP.

STATEMENTS OF OPERATIONS (UNAUDITED)

The accompanying notes are an integral part of these financial statements.

AZZURRO SOLUTIONS CORP.

STATEMENT OF STOCKHOLDER’S EQUITY (UNAUDITED)

FOR THE PERIOD FROM INCEPTION (OCTOBER 4, 2019) TO JUNE 30, 2020 & NINE MONTHS ENDED JUNE 30, 2021

The accompanying notes are an integral part of these financial statements.

AZZURRO SOLUTIONS CORP.

STATEMENTS OF CASH FLOWS (UNAUDITED)

The accompanying notes are an integral part of these financial statements.

AZZURRO SOLUTIONS CORP.

NOTES TO THE UNAUDITED FINANCIAL STATEMENTS

FOR THE PERIOD FROM INCEPTION (OCTOBER 4, 2019) TO JUNE 30, 2021

Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

FORWARD LOOKING STATEMENTS

Statements made in this Form 10-Q that are not historical or current facts are "forward-looking statements" made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 (the "Act") and Section 21E of the Securities Exchange Act of 1934. These statements often can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "approximate" or "continue," or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

DESCRIPTION OF OUR BUSINESS

Azzurro Solutions Corp. was incorporated in the State of Nevada on October 4, 2019 and established a fiscal year end of September 30. We have no revenues, have minimal assets and have incurred losses since inception. We are still in the development stage and as of today we have generated no revenue. Our business is the distribution of Bohemian crystal chandeliers produced in Czech Republic. We will distribute our chandeliers in the North American market to both retail and wholesale customers.

Bohemian glass, chiefly referred to as Bohemia crystal, is glass produced in the regions of Bohemia and Silesia, now parts of the Czech Republic. It has a centuries long history of being internationally recognized for its high quality, craftsmanship, beauty and often innovative designs. All our Bohemian crystal chandeliers come with a manufacturer's warranty and are guaranteed against any factory defects. We plan on purchasing products only from reliable and established suppliers with excellent reputation.

RESULTS OF OPERATION

As of June 30, 2021, we had deficit of $7,287. Our financial statements have been prepared assuming that we will continue as a going concern. We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.

Three Month Period Ended June 30, 2021 compared to the Three Month Period Ended June 30, 2020

Revenue

During the three month periods ended June 30, 2021 and 2020, the Company did not generate any revenue.

Operating Expenses

During the three month period ended June 30, 2021, we incurred total expenses and professional fees of $1,346 compared to $51 for the three month period ended June 30, 2020. General and administrative and professional fee expenses incurred generally related to corporate overhead, financial and administrative contracted services, such as legal and accounting.

Net Loss

Our net loss for the three month period ended June 30, 2021 was $1,346 compared to $51 for the three month period ended June 30, 2020.

Nine Month Period Ended June 30, 2021 compared to the Period from Inception (October 4, 2019) to June 30, 2020

Revenue

During the nine month period ended June 30, 2021 and for the period from inception (October 4, 2019) to June 30, 2020, the Company did not generate any revenue.

Operating Expenses

During the nine month period ended June 30, 2021, we incurred total expenses and professional fees of $6,255 compared to $867 for the period from inception (October 4, 2019) to June 30, 2020. General and administrative and professional fee expenses incurred generally related to corporate overhead, financial and administrative contracted services, such as legal and accounting.

Net Loss

Our net loss for the nine month period ended June 30, 2021 was $6,255 compared to $867 for the period from inception (October 4, 2019) to June 30, 2020.

LIQUIDITY AND CAPITAL RESOURCES

As at June 30, 2021 our total assets were $18,578 compared to $4,788 in total assets at September 30, 2020. As at June 30, 2021, our current liabilities were $1,770 compared to $1,020 as of September 30, 2020.

Stockholders' equity was $16,808 as of June 30, 2021 compared to $3,768 as of September 30, 2020.

Cash Flows from Operating Activities

For the nine-month period ended June 30, 2021, net cash flows used in operating activities was $6,255, consisting entirely of net loss of $6,255. For the period from inception (October 4, 2019) to June 30, 2020, net cash flows used in operating activities was $867 consisting entirely of net loss of $867.

Cash Flows from Financing Activities

Cash flows provided by financing activities during the nine-month period ended June 30, 2021 were $20,045, consisting of loan from shareholder of $750 and proceeds from issuance of common shares of $19,295 compared to $1,020 for the period from inception (October 4, 2019) to June 30, 2020, consisting entirely of loan from shareholder.

PLAN OF OPERATION AND FUNDING

We expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business.

Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next twelve months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) acquisition of inventory; (ii) developmental expenses associated with a start-up business; and (iii) marketing expenses. We intend to finance these expenses with further issuances of securities, and debt issuances. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations.

OFF-BALANCE SHEET ARRANGEMENTS

As of the date of this Quarterly Report, 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 are material to investors.

GOING CONCERN

The independent auditors' report accompanying our September 30, 2020 financial statements contained an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared "assuming that we will continue as a going concern," which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

Item 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Our disclosure controls and procedures are designed to ensure that information required to be disclosed in reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission. Our principal executive officer and principal financial and accounting officer have reviewed the effectiveness of our "disclosure controls and procedures" (as defined in the Securities Exchange Act of 1934 Rules 13(a)-15(e) and 15(d)-15(e)) within the end of the period covered by this Quarterly Report on Form 10-Q. Based on that evaluation, our management concluded that as a result of material weaknesses related to lack of segregation of duties and multiple levels of review over the financial reporting process, our disclosure controls and procedures were not effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms.

Changes in Internal Controls over Financial Reporting

There have been no changes in the Company's internal control over financial reporting during the last quarterly period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

Management is not aware of any legal proceedings contemplated by any governmental authority or any other party involving us or our properties. As of the date of this Quarterly Report, no director, officer or affiliate is (i) a party adverse to us in any legal proceeding, or (ii) has an adverse interest to us in any legal proceedings. Management is not aware of any other legal proceedings pending or that have been threatened against us or our properties.

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

No equity securities were sold during the nine-month period ended June 30, 2021.

Item 3. DEFAULTS UPON SENIOR SECURITIES

No senior securities were issued and outstanding during the nine-month period ended June 30, 2021.

Item 4. MINE SAFETY DISCLOSURES

Not applicable to our Company.

Item 5. OTHER INFORMATION

None.

Item 6. Exhibits

Exhibits:

SIGNATURES

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