MARQUIE: 10-K / A – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND OPERATING RESULTS

Forward-looking statements

This report contains forward-looking statements that involve risks and uncertainties. We use words such as anticipate, believe, plan, hope, future, intend and similar expressions to identify these forward-looking statements. You should not place undue reliance on these forward-looking statements. Our actual results are likely to differ materially from those anticipated in these forward-looking statements for a number of reasons.

Overview

The Marquié Group is a direct-to-consumer sales and marketing company with an exclusive pipeline of innovative health and beauty products. The Company markets these products through its wholly owned subsidiary Music of your life, a syndicated radio network heard nationwide on land-based AM, FM and HD radio stations, and broadcast simultaneously over the Internet. This is made possible by 30- and 60-second ads that run hourly that target Music of your life listening audience. Broadcasting over 40 years, Music of your life is the oldest music radio format in syndication.

Since we have incurred losses, the income tax expense is negligible. No tax benefit has been recognized in respect of operating loss carryforwards, given our uncertainty as to the possibility of using these loss carryforwards in future years. We expect to incur additional losses in the coming year.

Results of Operations

The following is management’s discussion of the relevant items affecting the results of operations for the years ended. May 31, 2021 and 2020.

Income. The Company generated net income of $ 60 during the year ended May 31, 2021 compared to $ 552 for the year ended May 31, 2020. Revenue was generated from sales of spots, live radio programming by radio stations across the country and on the Internet.

Cost of sales. Our cost of sale was -0 $– for the two completed years May 31, 2021 and 2020. Going forward, our costs to sell will consist primarily of license costs and royalties associated with our subscribed radio network, other related services provided directly or contracted out through our affiliates, as well as and related operational and personnel costs.

Salaries and consulting fees. Salaries payable and consulting fees for the year ended May 31, 2021 were $ 305,000 compared to $ 371,500 for the year ended May 31, 2020. We expect salaries and consulting expenses, which are based on cash rather than stocks, to increase as we add staff to grow our multimedia entertainment business.

Professional fees. Professional fees for the year ended May 31, 2021 were
$ 102,924 compared to $ 81,640 for the year ended May 31, 2020. We expect professional fees to increase in future periods as we increase our business.

Other selling, general and administrative expenses. Other selling, general and administrative expenses were $ 63,398 for the year ended May 31, 2021 compared to $ 187,950 for the year ended May 31, 2020. We expect other SG&A expenses to increase as our operations increase.

  10


  Table of Contents

Other income (expenses). The Company had other net expenses of $ 2,397,922 for the year ended May 31, 2021 compared to $ 304,275 for the year ended May 31, 2020. For the year ended May 31, 2021, the company incurred interest expense of
$ 989,810, the liability income derived from $ 36,930 and loss on conversion of notes payable and accrued interest of $ 1,445,042. For the year ended May 31, 2020, the company incurred interest expense of $ 792,400, the liability income derived from $ 647,927 and loss on conversion of notes payable and accrued interest of $ 159,802.

Liquidity and capital resources

From May 31, 2021, our main source of liquidity was -0 $– in cash and cash equivalents. We hold most of our cash reserves in local checking accounts with local financial institutions. Since inception, we have funded our operations through a combination of short and long term loans and the private placement of our common shares.

We suffered significant net losses which resulted in an accumulated deficit in the May 31, 2021 of $ 11,762,237 and are currently experiencing a substantial shortfall in operating capital, which raises doubts about our ability to continue operating. We generated a net loss for the year ended May 31, 2021 of $ 2,869,184. Without additional income, working capital loans or equity investment, there is substantial doubt as to our ability to continue as a business.

We believe these conditions result from the inherent risks associated with small public companies. These risks include, without limitation, the ability to (i) generate income and sales from our products and services at levels sufficient to cover our costs and provide a return to investors, (ii) attract additional capital in order to to finance growth, and (iii) to compete successfully with other comparable companies with financial, production and marketing resources clearly superior to those of the Company.

We believe that our capital resources are insufficient for ongoing operations, with minimal current cash reserves, especially given the resources required to grow our multimedia entertainment business. We are likely to need significant amounts of funding to make significant progress in our business strategy. There is currently no agreement in place that will secure funding for our company, and we cannot assure you that we will be able to raise additional funds, or that such funds will be available on acceptable terms. Funds raised through future equity financing will likely have a significant dilutive effect on current shareholders. Lack of additional funds will significantly affect our company and operations and may cause us to significantly reduce or even cease operations. As a result, you could suffer a loss of your entire investment in the Company.

Off-balance sheet provisions

We do not have off-balance sheet arrangements.

  11


  Table of Contents

Critical accounting policies

We believe the following most critical accounting policies are used in the preparation of our financial statements:

Use of estimates. The preparation of financial statements in accordance with generally accepted accounting principles in United States of America
requires management to make estimates and assumptions that affect the amounts presented in the financial statements and accompanying notes. Actual results could differ from these estimates. Periodically, management reviews these estimates, including those related to valuation allowances, loss contingencies, income taxes and the projection of future cash flows.

Research and development. Research and development costs are charged to earnings when incurred and are included in operating expenses.

Recent accounting positions

Various accounting standards and interpretations have been published recently, none of which are expected to have a material impact on the consolidated financial position, operations or cash flows of the Company.

Forward-Looking Statements

This report contains or incorporates by reference forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 regarding our future business plans and strategies, receipt of working capital, future income and other statements which are not historical in nature. . In this report, forward-looking statements are often identified by the words “anticipate”, “plan”, “believe”, “expect”, “estimate”, etc. These forward-looking statements reflect our current beliefs, expectations and opinions regarding future events, and involve future risks and uncertainties that could cause actual results to differ materially from those expressed or implied.

Other uncertainties that could affect the accuracy of forward-looking statements include:

• the world economic situation;

• any change in interest rates or inflation;

• the willingness and ability of third parties to honor their contractual obligations

commitments;

• our ability to raise additional capital, as it may be affected by

stock market conditions and competition for venture capital;

• our capital expenditures, as they may be affected by delays or cost overruns;

• environmental and other regulations, as they currently exist or may in the future

be changed;

• our ability to identify, finance and integrate possible future acquisitions; and

• the volatility of the price of our common shares.

This list is not exhaustive of the factors that could affect any of our forward-looking statements. You should read this report in its entirety and with the understanding that our actual future results may be materially different from what we expect. These forward-looking statements represent our beliefs, expectations and opinions only as of the date of this report. We do not intend to update these forward-looking statements, except as required by law. We qualify all of our forward-looking statements with these cautionary statements.

© Edgar online, source Previews