See accompanying notes to the condensed consolidated financial statements.
See accompanying notes to the condensed consolidated financial statements.
See accompanying notes to the condensed consolidated financial statements.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
NOTE 1 – ORGANIZATION AND BUSINESS BACKGROUND
BioNexus Gene Lab Corp. (the “Company”) was incorporated in the State of Wyoming on May 12, 2017. On August 23, 2017, the Company acquired all the outstanding capital stock of BGS Lab Sdn. Bhd., a Malaysian corporation (“BioNexus Malaysia”). BioNexus Malaysia was incorporated in Malaysia on April 7, 2015 which it then subsequently changed its name to Bionexus Gene Lab Sdn. Bhd.
The principal office address is Unit 02 Level 10, Tower B, Vertical Business Suite, No. 8 Jalan Kerinchi, Bangsar South, 59200 Kuala Lumpur, Malaysia, our lab is located at Lab 353, Chemical Science Centre, University Science Malaysia, George Town, Penang, Malaysia. We also have a blood collection center located at 1st floor, Lifecare Medical Centre, Kuala Lumpur, Malaysia.
On December 31, 2020, the Company consummated its acquisition of Chemrex Corporation Sdn. Bhd. (“Chemrex”), pursuant to a Share Exchange Agreement by and among the Company, Chemrex and the Chemrex shareholders wherein the Company acquired all the issued and outstanding shares of capital stock of Chemrex from the Chemrex shareholders in exchange for 68,487,261 shares of common stock of the Company.
The acquisition of Chemrex has been accounted for as a common control transaction as there is no change in the control over the assets acquired and liabilities assumed. The net assets are derecognized by the transferring entity (i.e. Chemrex) and recognized by the receiving entity (i.e. the Company). The difference between the consideration transferred and the carrying amounts of the net assets is recognized in equity.
The financial statements of the receiving entity report the results of operations for the period in which the transfer occurs as though the transfer of net assets or exchange of equity interests had occurred at the beginning of the period. Results of operations for that period will thus comprise those of the previously separate entities combined from the beginning of the period to the date the transfer is completed and those of the combined operations from that date to the end of the period. The comparative financial statements were not adjusted retrospectively as Chemrex was not under common control during the comparative period.
The corporate structure as at March 31, 2023 is depicted below:
| | BioNexus Gene Lab Corp. (a Wyoming company) | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| 100% | | | | 100% |
| | | | | |
Bionexus Gene Lab Sdn Bhd (a Malaysia company) | | | Chemrex Corporation Sdn Bhd (a Malaysia Company) |
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying unaudited condensed consolidated financial statements reflect the application of certain significant accounting policies as described in this note and elsewhere in the accompanying consolidated financial statements and notes.
The accompanying condensed consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”).
The condensed consolidated financial statements include the accounts of Bionexus Gene Lab Corp. and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.
In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheets and revenues and expenses during the periods reported. Actual results may differ from these estimates. |
· | Cash and cash equivalents |
Cash and cash equivalents represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of Three months or less as of the purchase date of such investments.
Trade receivables are recorded at the invoiced amount and do not bear interest. Management reviews the adequacy of the allowance for impairment on an ongoing basis, using historical collection trends and aging of receivables. Management also periodically evaluates individual customer’s financial condition, credit history, and the current economic conditions to adjust in the allowance when it is considered necessary. Trade balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote.
Inventories consisting of products available for sell, are stated at the lower of cost or market value. Cost of inventory is determined using the first-in, first-out (FIFO) method. Inventory reserve is recorded to write down the cost of inventory to the estimated market value due to slow-moving merchandise and damaged goods, which is dependent upon factors such as historical and forecasted consumer demand, and promotional environment. The Company takes ownership, risks and rewards of the products purchased. Write downs are recorded in cost of revenues in the Statement of Operations and Comprehensive Income.
Prior to January 1, 2019, the Company accounted for leases under ASC 840, Accounting for Leases. Effective January 1, 2019, the Company adopted the guidance of ASC 842, Leases, which requires an entity to recognize a right-of-use asset and a lease liability for virtually all leases. The Company adopted ASC 842 using a modified retrospective approach. As a result, the comparative financial information has not been updated and the required disclosures prior to the date of adoption have not been updated and continue to be reported under the accounting standards in effect for those periods.
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
· | Property, plant and equipment |
Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis to write off the cost over the following expected useful lives of the assets concerned.
The principal annual rates used are as follows:
Categories | | Principal Annual Rates | |
Air conditioner | | | 20 | % |
Buildings | | | 2 | % |
Computer and software | | | 33 | % |
Equipment | | | 20 | % |
Furniture and fittings | | 10% to 20 | % |
Lab Equipment | | | 10 | % |
Motor vehicle | | 10% to 20 | % |
Office equipment | | | 20 | % |
Renovation | | 10% to 20 | % |
Signboard | | | 10 | % |
Leasehold lands are depreciated over the period of lease term. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Company will obtain ownership by the end of the lease term. Freehold land is not depreciated. Property, plant and equipment under construction are not depreciated until the assets are ready for their intended use.
Maintenance and repairs are charged to operations as incurred. Expenditures which substantially increase the useful lives of the related assets are capitalized. When properties are disposed, the related costs and accumulated depreciation are removed from the accounts and any gain or loss is reported in the period the transaction takes place.
Fully depreciated plant and equipment are retained in the financial statements until they are no longer in use.
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
· | Impairment of long-lived assets |
Long-lived assets primarily include goodwill, intangible assets and property, plant and equipment. In accordance with the provision of ASC Topic 360, “Impairment or Disposal of Long-Lived Assets”, the Company generally conducts its annual impairment evaluation to its long-lived assets, usually in the fourth quarter of each fiscal year, or more frequently if indicators of impairment exist, such as a significant sustained change in the business climate. The recoverability of long-lived assets is measured at the lowest level group. If the total of the expected undiscounted future net cash flows is less than the carrying amount of the asset, a loss is recognized for the difference between the fair value and carrying amount of the asset. There has been no impairment charge for the years presented.
Revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services.
The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:
Revenues are recognized when control of the promised goods or services are transferred to a customer, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services.
The Company applies the following five steps in order to determine the appropriate amount of revenue to be recognized as it fulfills its obligations under each of its agreements:
· | identify the contract with a customer; |
· | identify the performance obligations in the contract; |
· | determine the transaction price; |
· | allocate the transaction price to performance obligations in the contract; and |
· | recognize revenue as the performance obligation is satisfied. |
The Company records revenue at point in time which is recognized upon goods delivered or services rendered.
· | Shipping and handling fees |
Shipping and handling fees, if billed to customers, are included in revenue. Shipping and handling fees associated with inbound and outbound freight are expensed as incurred and included in selling and distribution expenses.
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
ASC Topic 220, “Comprehensive Income” establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying statements of stockholders’ equity consists of changes in unrealized gains and losses on foreign currency translation and cumulative net change in the fair value of available-for-sale investments held at the balance sheet date. This comprehensive income is not included in the computation of income tax expense or benefit.
Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC Topic 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.
ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclosed in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.
The Company conducts major businesses in Malaysia and is subject to tax in their own jurisdictions. As a result of its business activities, the Company will file separate tax returns that are subject to examination by the foreign tax authorities.
· | Net earnings or loss per share |
The Company calculates net earnings or loss per share in accordance with ASC Topic 260 “Earnings per share”. Basic earnings or loss per share is computed by dividing the net earnings or loss by the weighted average number of common shares outstanding during the period. Diluted earnings or loss per share is computed similar to basic earnings or loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive.
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
· | Foreign currencies translation |
Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.
The functional currency of the Company is the United States Dollars (“US$”) and the accompanying financial statements have been expressed in US$. In addition, the subsidiaries maintain its books and record in a local currency, Malaysian Ringgit (“MYR” or “RM”), which is functional currency as being the primary currency of the economic environment in which the subsidiaries operate.
In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income.
Translation of amounts from MYR into US$1.00 has been made at the following exchange rates for the respective period and year:
| | March 31, | | | December 31, | |
| | 2023 | | | 2022 | |
Period ended March 31, 2023 /Year-ended December 31, 2022 US$1: MYR exchange rate | | | 4.4170 | | | | 4.3900 | |
| | | | | | | | |
| | January 1, 2023 to March 31, 2023 | | | January 1, 2022 to March 31, 2022 | |
3 months average US$1: MYR exchange rate | | | 4.3968 | | | | 4.1938 | |
Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence.
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
· | Fair value of financial instruments |
The carrying value of the Company’s financial instruments: cash and cash equivalents, trade receivable, deposits and other receivables, amount due to related parties and other payables approximate at their fair values because of the short-term nature of these financial instruments.
The Company also follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” (“ASC 820-10”), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a six-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:
· | Level 1: Observable inputs such as quoted prices in active markets; |
| |
· | Level 2: Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and |
· | Level 3: Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions |
As of March 31, 2023, and December 31, 2022, the Company did not have any nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements, at least annually, on a recurring basis, nor did the Company have any assets or liabilities measured at fair value on a non-recurring basis.
· | Recent accounting pronouncements |
The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.
In May 2019, the FASB issued ASU 2019-05, which is an update to ASU Update No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which introduced the expected credit losses methodology for the measurement of credit losses on financial assets measured at amortized cost basis, replacing the previous incurred loss methodology. The amendments in Update 2016-13 added Topic 326, Financial Instruments—Credit Losses, and made several consequential amendments to the Codification. The amendments in this Update address those stakeholders’ concerns by providing an option to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost basis. For those entities, the targeted transition relief will increase comparability of financial statement information by providing an option to align measurement methodologies for similar financial assets. Furthermore, the targeted transition relief also may reduce the costs for some entities to comply with the amendments in Update 2016-13 while still providing financial statement users with decision-useful information. In November 2019, the FASB issued ASU No. 2019-10, which to update the effective date of ASU No. 2016-13 for private companies, not-for-profit organizations and certain smaller reporting companies applying for credit losses, leases, and hedging standard. The new effective date for these preparers is for fiscal years beginning after December 15, 2022. ASU 2019-05 is effective for the Company for annual and interim reporting periods beginning January 1, 2023 as the Company is qualified as a smaller reporting company. The Company is currently evaluating the impact ASU 2019-05 may have on its consolidated financial statements.
FASB issues various Accounting Standards Updates relating to the treatment and recording of certain accounting transactions. On June 10, 2014, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) No. 2014-10, Development Stage Entities (Topic 915) Elimination of Certain Financial Reporting Requirements, including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation, which eliminates the concept of a development stage entity (DSE) entirely from current accounting guidance. The Company has elected adoption of this standard, which eliminates the designation of DSEs and the requirement to disclose results of operations and cash flows since inception.
NOTE 3 - TRADE RECEIVABLES
The Company has performed an analysis on all its trade receivables and determined that all amounts are collectible by the Company. As such, trade receivables are reflected as a current asset and no allowance for impairment has been recorded as of March 31, 2023 and December, 31, 2022. The Company’s trade receivables consist of receivable from customers which are unrelated to the Company. The account receivables are interest bearing at a rate of 6% per annum on a case to case basis for customers that exceeded credit term. The normal trade credit term is generally on 30 days to 90 days term.
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
NOTE 4 - INCOME TAXES
The Company provides for income taxes under ASC 740, “Income Taxes. ASC 740 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statements and tax basis of assets and liabilities and the tax rates in effect when these differences are expected to reverse. It also requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.
Provision for income taxes consisted of the following:
United States of America
The Company is registered in the State of Wyoming and is subject to the tax laws of the United States of America.
Malaysia
BioNexus Malaysia and Chemrex are both subject to Malaysia Corporate Tax, which is charged at the statutory income tax rate range is 24% on its assessable income. Under the amendment of Income Tax Act 1967 by the Finance Act 2020 and with effect from year of assessment 2020, companies with paid-up capital of RM2.5 million or less, and with annual business income of not more than RM50 million are subject to Small and Medium Enterprise Corporate Tax at 17% on chargeable income up to RM600,000 (2021: RM600,000) except for companies with investment holding nature or companies does not have gross income from business sources are subject to corporate tax at 24% on chargeable income.
| | As of | |
| | March 31, | | | December 31, | |
| | 2023 | | | 2022 | |
Tax Recoverable | | | | | | |
Local | | $ | - | | | $ | - | |
Foreign, representing Malaysia | | | (27,823 | ) | | | (31,551 | ) |
Tax Recoverable | | | (27,823 | ) | | | (31,551 | ) |
| | | | | | | | |
Income tax liabilities: | | | | | | | | |
Local | | $ | - | | | $ | - | |
Foreign, representing Malaysia | | | - | | | | - | |
Income tax payables | | | - | | | | - | |
| | | | | | | | |
Deferred tax liabilities: | | | | | | | | |
Local | | $ | - | | | $ | - | |
Foreign, representing Malaysia | | | 30,678 | | | | 30,866 | |
Deferred tax liabilities | | | 30,678 | | | | 30,866 | |
Total | | | 2,855 | | | | (685 | ) |
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
NOTE 5 – OPERATING LEASE RIGHT OF USE ASSET AND LEASE LIABILITIES
Lease liabilities are measured at present value of the sum of remaining rental payment as of recognition with discount rate of 6.40% per annum adopted from Malayan Banking (Maybank) Berhad's base rate as a reference for discount rate, as this bank is the largest bank and national bank of Malaysia.
A single lease cost is recognized over the lease term on a generally straight-line basis. All cash payments of operating lease cost are classified within operating activities in the statement of cash flows.
Operating lease right of use assets as follows: | | As of | |
| | March 31, | | | December 31, | |
| | 2023 | | | 2022 | |
Balance as of beginning of the year | | $ | 55,730 | | | $ | 41,090 | |
Add: Addition of lease liabilities | | | - | | | | 32,281 | |
Less: Amortization | | | (3,954 | ) | | | (15,534 | ) |
Foreign translation differences | | | (341 | ) | | | (2,106 | ) |
Balance | | $ | 51,436 | | | $ | 55,730 | |
Operating lease liabilities as follows: | | | |
| | March 31, | | | December 31, | |
| | 2023 | | | 2022 | |
Balance as of beginning of the year | | $ | 56,775 | | | $ | 42,909 | |
Add: Addition of lease liabilities | | | - | | | | 30,770 | |
Less: gross repayment | | | (4,875 | ) | | | (19,618 | ) |
Add: imputed interest | | | 855 | | | | 4,913 | |
Foreign translation differences | | | (346 | ) | | | (2,199 | ) |
Balance as of end of the year | | | 52,409 | | | | 56,775 | |
Less: lease liability current portion | | | (16,733 | ) | | | (16,569 | ) |
Lease liability non-current portion | | $ | 35,676 | | | $ | 40,206 | |
The amortization of the right of use asset for the three months’ period ended March 31, 2023 and the three months’ period ended March 31, 2022 were $3,972 and $4,341 respectively.
Other information: | | As of | |
| | March 31, 2023 | | | December 31, 2022 | |
Cash paid for amounts included in the measurement of lease liabilities: | | | | | | |
Operating cash flow from operating lease | | $ | (4,366 | ) | | $ | (126,686 | ) |
Right of use assets obtained in exchange for operating lease liabilities | | | 51,436 | | | | 55,730 | |
Remaining lease term for operating lease (years) | | | 3.75 | | | | 4 | |
Weighted average discount rate for operating lease | | $ | 6.40 | % | | $ | 6.40 | % |
Lease expenses for the three months’ period ended March 31, 2023 and the year ended December 31, 2022 were $855 and $4,913, respectively.
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
NOTE 6 - PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment consisted of the following:
| | As of | |
| | March 31, | | | December 31, | |
| | 2023 | | | 2022 | |
Air conditioner | | $ | 1,124 | | | $ | 1,124 | |
Computer and software | | | 2,516 | | | | 2,516 | |
Equipment | | | 60,525 | | | | 60,525 | |
Furniture and fittings | | | 87,122 | | | | 87,122 | |
Lab equipment | | | 320,102 | | | | 320,102 | |
Land and buildings | | | 1,506,969 | | | | 1,506,969 | |
Motor vehicle | | | 137,914 | | | | 137,914 | |
Office equipment | | | 38,213 | | | | 38,213 | |
Renovation | | | 107,414 | | | | 107,414 | |
Signboard | | | 806 | | | | 704 | |
| | | 2,262,705 | | | | 2,262,603 | |
(Less): Accumulated depreciation | | | (611,214 | ) | | | (590,317 | ) |
Add: Foreign translation differences | | | (169,724 | ) | | | (133,982 | ) |
Property, plant and equipment, net | | $ | 1,481,767 | | | $ | 1,511,708 | |
Depreciation expense for the three months’ period ended March 31, 2023 and 2022 were $20,897 and $22,307 respectively.
NOTE 7 - OTHER INVESTMENTS
| | As of | |
| | March 31, | | | December 31, | |
| | 2023 | | | 2022 | |
As of beginning of the year | | $ | 1,150,898 | | | $ | 749,027 | |
Addition during the year | | | 13,646 | | | | 511,706 | |
Disposal during the year | | | - | | | | (1,776 | ) |
Fair value loss | | | 37,399 | | | | (70,628 | ) |
Foreign exchange translation | | | (7,268 | ) | | | (37,431 | ) |
As of end of the year | | $ | 1,194,675 | | | $ | 1,150,898 | |
The other investments consist of the following shares:
| | As of | |
| | March 31, | | | December 31, | |
| | 2023 | | | 2022 | |
Investment in quoted shares: | | | | | | |
Malaysia | | | 689,531 | | | | 659,970 | |
Singapore | | | 94,757 | | | | 101,426 | |
Hong Kong | | | 410,387 | | | | 389,502 | |
| | $ | 1,194,675 | | | $ | 1,150,898 | |
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
NOTE 8 - TRADE PAYABLES
Trade payables are amounts billed to the Company by suppliers for goods and services in the ordinary course of business. All amounts have short-term repayment terms and vary by supplier.
NOTE 9 - CONCENTRATION OF RISKS
a) Major customers
During the period, the Company did not have any material recognizable major customers accounted for 10% or more of the Company’s revenue for the financial period ended March 31, 2023 and 2022.
b) Major suppliers
For month ended March 31, 2023 and 2022, the suppliers who accounted for 10% or more of the Company’s cost of sales and their balances at year ended are presented as follows:
| | 2023 | | | 2022 | | | 2023 | | | 2022 | | | 2023 | | | 2022 | |
| | Purchase | | | Percentage of purchases | | | | Accounts payable trade | |
Vendor A | | $ | 410,208 | | | $ | 504,906 | | | | 20.43 | % | | | 18.89 | % | | $ | 408,334 | | | $ | 502,559 | |
Vendor B | | $ | 314,739 | | | $ | 333,751 | | | | 15.67 | % | | | 12.49 | % | | $ | 313,300 | | | $ | 332,200 | |
Vendor C | | $ | 213,965 | | | $ | 449,494 | | | | 10.65 | % | | | 16.82 | % | | $ | 199,312 | | | $ | 178,749 | |
| | $ | 938,912 | | | $ | 1,288,151 | | | | 46.75 | % | | | 48.20 | % | | $ | 920,946 | | | $ | 1,013,508 | |
NOTE 10 - STOCK HOLDERS’ EQUITY
As at March 31, 2023 and 2022, the Company issued and outstanding common stock is 173,718,152 and 171,218,152 shares respectively.
NOTE 11 - SEGMENTED INFORMATION
At March 31, 2023, the Company (“BGLC”) operates in the biochemical industry segment through its two Malaysian subsidiaries, BioNexus Malaysia and Chemrex.
| | BioNexus Gene Lab Corp. (a Wyoming company) | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| 100% | | | | 100% |
| | | | | |
Bionexus Gene Lab Sdn Bhd (a Malaysia company) | | | Chemrex Corporation Sdn Bhd (a Malaysia Company) |
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
For the quarter ended March 31, 2023, segmented (unaudited) revenue and net profit/(loss) (Currency expressed in United States Dollars (“US$”) are as follows:
| | BioNexus Malaysia | | | Chemrex | | | BGLC | | | Total | |
| | Three months ended March 31, 2023 | |
| | | | | | | | | | | | |
REVENUE | | $ | 7,436 | | | $ | 2,369,769 | | | $ | - | | | $ | 2,377,205 | |
| | | | | | | | | | | | | | | | |
COST OF REVENUE | | | (5,347 | ) | | | (2,002,961 | ) | | | - | | | | (2,008,308 | ) |
| | | | | | | | | | | | | | | | |
GROSS /PROFIT | | | 2,089 | | | | 366,808 | | | | - | | | | 368,897 | |
| | | | | | | | | | | | | | | | |
OTHER INCOME | | | 1,126 | | | | 116,218 | | | | - | | | | 117,344 | |
| | | | | | | | | | | | | | | | |
OPERATING EXPENSES | | | | | | | | | | | | | | | | |
General and administrative | | | (46,255 | ) | | | (383,177 | ) | | | (107,440 | ) | | | (536,872 | ) |
| | | | | | | | | | | | | | | | |
(LOSS)/PROFIT FROM OPERATIONS | | | (43,040 | ) | | | 99,849 | | | | (107,440 | ) | | | (50,631 | ) |
| | | | | | | | | | | | | | | | |
FINANCE COSTS | | | (666 | ) | | | (1,779 | ) | | | - | | | | (2,445 | ) |
| | | | | | | | | | | | | | | | |
(LOSS)/PROFIT BEFORE TAX | | | (43,706 | ) | | | 98,070 | | | | (107,440 | ) | | | (53,076 | ) |
| | | | | | | | | | | | | | | | |
Tax expense | | | - | | | | (15,990 | ) | | | - | | | | (15,990 | ) |
| | | | | | | | | | | | | | | | |
NET (LOSS)/PROFIT | | $ | (43,706 | ) | | $ | 82,080 | | | $ | (107,440 | ) | | $ | (69,066 | ) |
BIONEXUS GENE LAB CORP.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2023
(Currency expressed in United States Dollars (“US$”))
(Unaudited)
| | BioNexus Malaysia | | | Chemrex | | | BGLC | | | Total | |
| | Three months ended March 31, 2022 | |
REVENUE | | $ | 24,269 | | | $ | 3,004,676 | | | $ | - | | | $ | 3,028,945 | |
| | | | | | | | | | | | | | | | |
COST OF REVENUE | | | (8,038 | ) | | | (2,664,574 | ) | | | - | | | | (2,672,612 | ) |
| | | | | | | | | | | | | | | | |
GROSS PROFIT | | | 16,231 | | | | 340,102 | | | | - | | | | 356,333 | |
| | | | | | | | | | | | | | | | |
OTHER INCOME | | | 2,076 | | | | 44,306 | | | | 12 | | | | 46,394 | |
| | | | | | | | | | | | | | | | |
OPERATING EXPENSES | | | | | | | | | | | | | | | | |
General and administrative | | | (44,042 | ) | | | (297,769 | ) | | | (26,225 | ) | | | (368,036 | ) |
| | | | | | | | | | | | | | | | |
(LOSS)/PROFIT FROM OPERATIONS | | | (25,735 | ) | | | 86,639 | | | | (26,213 | ) | | | 34,691 | |
| | | | | | | | | | | | | | | | |
FINANCE COSTS | | | (799 | ) | | | (2,527 | ) | | | - | | | | (3,326 | ) |
| | | | | | | | | | | | | | | | |
PROFIT/(LOSS) BEFORE TAX | | | (52,269 | ) | | | 170,751 | | | | (52,426 | ) | | | 31,365 | |
| | | | | | | | | | | | | | | | |
Tax expense | | | - | | | | (14,299 | ) | | | - | | | | (14,299 | ) |
| | | | | | | | | | | | | | | | |
NET PROFIT/(LOSS) | | $ | (52,269 | ) | | $ | 502,730 | | | $ | (52,426 | ) | | $ | 17,066 | |
| | As of March 31, 2023 and December 31, 2022 | |
| | Total Assets | | | Total Liabilities | |
| | 2023 | | | 2022 | | | 2023 | | | 2022 | |
| | | | | | | | | | | | |
BGLC & Bionexus | | $ | 509,574 | | | $ | 677,477 | | | $ | 93,034 | | | $ | 108,390 | |
Chemrex | | | 7,677,067 | | | | 8,062,685 | | | | 1,536,699 | | | | 1,966,759 | |
TOTAL | | | 8,186,641 | | | | 8,740,162 | | | | 1,629,733 | | | | 2,075,149 | |
NOTE 12 - SUBSEQUENT EVENTS
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, 2023 up through May 7, 2023 of these consolidated financial statements.