UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
10-Q
x
QUARTERLY REPORT UNDER TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED FEBRUARY 28, 2015
OR
o TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission File Number: 000-54482
CN RESOURCES INC.
(Exact name of registrant as specified
in its charter)
NEVADA
(State or other jurisdiction of incorporation
or organization)
255 Duncan Mill Road, Suite 203
Toronto, Ontario
Canada M3B 3H9
(Address of principal executive offices,
including zip code)
(416) 510-2991
(Registrant’s telephone number,
including area code)
Check
whether the issuer (1) 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 last 90 days. YES x NO o
Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (SS 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 o NO x
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,” “non-accelerated filer,” and “smaller reporting
company” in Rule 12b-2 of the Exchange Act.
|
Large Accelerated Filer |
o |
Accelerated Filer |
o |
|
Non-accelerated Filer |
o |
Smaller Reporting Company |
x |
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES o NO x
State the number of shares outstanding
of each of the issuer’s classes of common equity, as of the latest practicable date: 56,100,000 as of April 20, 2015.
TABLE
OF CONTENTS
PART
I - FINANCIAL INFORMATION
ITEM
1. FINANCIAL STATEMENTS.
CN RESOURCES INC.
Balance Sheets
(Unaudited)
| |
February 28,
2015 | | |
May 31,
2014 | |
Assets | |
| | |
| |
| |
| | |
| |
Current assets | |
| | |
| |
Cash and cash equivalents | |
$ | 275,556 | | |
$ | 6,052,324 | |
Accounts receivable | |
| 22,901 | | |
| 61,332 | |
Note receivable | |
| 5,364,673 | | |
| - | |
Interest receivable | |
| 41,649 | | |
| - | |
Other receivable | |
| 6,355 | | |
| 4,296 | |
Total current assets | |
$ | 5,711,134 | | |
$ | 6,117,952 | |
| |
| | | |
| | |
Oil and gas properties (successful efforts), net | |
$ | 427,767 | | |
$ | 451,043 | |
| |
| | | |
| | |
Total assets | |
$ | 6,138,901 | | |
$ | 6,568,995 | |
| |
| | | |
| | |
| |
| | | |
| | |
Liabilities and Stockholders' Equity | |
| | | |
| | |
| |
| | | |
| | |
Liabilities | |
| | | |
| | |
Current Liabilities | |
| | | |
| | |
Accounts payable | |
$ | 15,157 | | |
$ | 5,952 | |
Due to director | |
| 355,061 | | |
| 319,492 | |
Total current liabilities | |
| 370,218 | | |
| 325,444 | |
| |
| | | |
| | |
Asset retirement obligation | |
| 6,502 | | |
| 5,960 | |
| |
| | | |
| | |
Total liabilities | |
| 376,720 | | |
| 331,404 | |
| |
| | | |
| | |
Stockholders' equity | |
| | | |
| | |
Common
stock,100,000,000 of shares authorized with $0.00001 par value, 56,100,000 issued and outstanding | |
| 561 | | |
| 561 | |
Preferred stock,100,000,000 shares authorized with $0.00001par value, none issued | |
| - | | |
| - | |
Additional paid-in capital | |
| 6,514,639 | | |
| 6,514,639 | |
Accumulated deficit | |
| (753,019 | ) | |
| (277,609 | ) |
Total stockholders' equity | |
| 5,762,181 | | |
| 6,237,591 | |
| |
| | | |
| | |
Total liabilities and stockholders' equity | |
$ | 6,138,901 | | |
$ | 6,568,995 | |
The accompanying
notes are an integral part of these unaudited financial statements.
CN RESOURCES INC.
Statements of Operations
(Unaudited)
| |
For the Three Months Ended | | |
For the Nine Months Ended | |
| |
February 28 | | |
February 28 | | |
February 28 | | |
February 28 | |
| |
2015 | | |
2014 | | |
2015 | | |
2014 | |
| |
| | |
| | |
| | |
| |
Revenue, net of royalty | |
$ | 11,837 | | |
$ | 83,336 | | |
$ | 151,693 | | |
$ | 114,371 | |
| |
| | | |
| | | |
| | | |
| | |
Operating expenses | |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | |
Bank service charge and bad debt | |
| 79 | | |
| 98 | | |
| 176 | | |
| 234 | |
Depreciation and depletion | |
| 19,754 | | |
| 3,770 | | |
| 63,334 | | |
| 6,283 | |
Management fee | |
| 6,000 | | |
| 6,000 | | |
| 18,000 | | |
| 18,000 | |
Production cost | |
| 19,510 | | |
| 30,069 | | |
| 32,383 | | |
| 36,639 | |
Professional fees | |
| 39,396 | | |
| 3,200 | | |
| 59,456 | | |
| 13,378 | |
Regulatory filing | |
| 3,200 | | |
| 2,859 | | |
| 16,447 | | |
| 2,859 | |
General and administrative expenses | |
| 8,845 | | |
| 9,274 | | |
| 31,608 | | |
| 27,824 | |
Total operating expenses | |
| 96,784 | | |
| 55,270 | | |
| 221,404 | | |
| 105,217 | |
| |
| | | |
| | | |
| | | |
| | |
Foreign Exchange Gain/(Loss) | |
| (449,752 | ) | |
| (713 | ) | |
| (449,752 | ) | |
| (713 | ) |
| |
| | | |
| | | |
| | | |
| | |
Interest income | |
$ | 44,058 | | |
$ | - | | |
$ | 44,058 | | |
$ | - | |
| |
| | | |
| | | |
| | | |
| | |
Net income (loss) for the period | |
$ | (490,642 | ) | |
$ | 27,354 | | |
$ | (475,405 | ) | |
$ | 8,441 | |
| |
| | | |
| | | |
| | | |
| | |
Income (Loss) per common share - basic and diluted | |
$ | (0.01 | ) | |
$ | 0.00 | | |
$ | (0.01 | ) | |
$ | 0.00 | |
| |
| | | |
| | | |
| | | |
| | |
| |
| | | |
| | | |
| | | |
| | |
Weighted
average common shares outstanding - basic and diluted | |
| 56,100,000 | | |
| 26,100,000 | | |
| 56,100,000 | | |
| 26,100,000 | |
The accompanying notes are an integral part of these unaudited interim financial statements.
CN RESOURCES INC.
Statements of Cash Flows
Unaudited
| |
For the nine months | | |
For the nine months | |
| |
ended | | |
ended | |
| |
February 28, 2015 | | |
February 28, 2014 | |
| |
| | |
| |
Cash Flows From Operating Activities | |
| | |
| |
Net Income (loss) for the period | |
$ | (475,410 | ) | |
$ | 8,441 | |
Adjustments to reconcile net loss to net cash in operating activities | |
| | | |
| | |
Depreciation and depletion | |
| 63,334 | | |
| 6,283 | |
Unrealized loss on foreign currency | |
| 449,752 | | |
| - | |
Changes in operating assets and liabilities | |
| | | |
| | |
Accounts receivable | |
| 38,430 | | |
| (24,128 | ) |
Accounts payable | |
| 9,205 | | |
| (97,940 | ) |
Interest receivable | |
| (41,648 | ) | |
| - | |
Other receivable | |
| (75,441 | ) | |
| (4,142 | ) |
Net cash used in operating activities | |
| (31,778 | ) | |
| (111,486 | ) |
| |
| | | |
| | |
Cash Flows from Financing Activities | |
| | | |
| | |
Due to Director | |
| 60,133 | | |
| 107,449 | |
Payment to Director for advances | |
| (24,564 | ) | |
| (9,412 | ) |
Net cash provided by financing activities | |
| 35,569 | | |
| 98,037 | |
| |
| | | |
| | |
Cash Flows used in Investing Activities | |
| | | |
| | |
Oil and Gas properties | |
| (39,516 | ) | |
| - | |
Note receivable | |
| (5,741,043 | ) | |
| - | |
Net cash used in financing activities | |
| (5,780,559 | ) | |
| - | |
| |
| | | |
| | |
| |
| | | |
| | |
Net increase (decrease) in cash and cash equivalents | |
| (5,776,768 | ) | |
| (13,449 | ) |
Cash and cash equivalents, beginning of the period | |
| 6,052,324 | | |
| 25,468 | |
Cash and cash equivalents, end of the period | |
| 275,556 | | |
| 12,019 | |
| |
| | | |
| | |
Supplemental disclosure | |
| | | |
| | |
Due to Director for equipment purchased | |
| - | | |
| 91,837 | |
Cash paid for interest: | |
| - | | |
| - | |
Cash paid for taxes | |
| - | | |
| - | |
The accompanying notes are an integral part of these unaudited
interim financial statements.
CN
RESOURCES INC.
Notes to
the Financial Statements
(Unaudited)
February
28, 2015
1. BUSINESS
OPERATIONS
CN Resources
Inc. is an independent energy company engaged in the exploration, development, production, and sale of crude oil. Our operations
are conducted through a 100% wholly owned Ontario Corporation (also named CN Resources Inc.) which owns a producing joint venture
oil well in the Redwater area in Alberta, Canada.
2. BASIS
OF PRESENTATION
The accompanying
unaudited interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted
in the United States of America and the rules of the Securities and Exchange Commission, and should be read in conjunction with
the audited financial statements and notes thereto contained in the Company’s most recent Annual Financial Statements filed
with the SEC on Form 10-K. In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary
for a fair presentation of financial position and the results of operations for the interim period presented have been reflected
herein. The results of operations for the interim period are not necessarily indicative of the results to be expected for the
full year. Notes to the financial statements which would substantially duplicate the disclosures contained in the audited financial
statements for the most recent fiscal period, as reported in the Form 10-K, have been omitted. Certain prior period balances have
been reclassified to conform to current period presentation.
3. NOTES
RECEIVABLE
On November
13, 2014, the Company provided a loan in the amount of $1,281,280 (CAD $1,600,000) to a third party with an interest of 7% per
annum. On January 12, 2015 and January 21, 2015, the Company provided a further $4,084,080(CAD $5,100,000) to the same third party
with an interest of 7% per annum. These loans are unsecured and due on demand. Interest payment is due quarterly in arrears. As
of February 28, 2015, we have received $44,058 in interest income. Management intends to earn an interest on the funds on hand
and will call the notes as soon as it deem desirable to do so. These Notes are in Canadian dollars, and due to significant devaluation
of the Canadian dollars against United States dollars, as at February 28, 2015, we have a material unrealized foreign currency
exchange loss in the amount of $449,752.
4. DUE
TO DIRECTOR
The
director loans the company money from time to time on an interest-free due-on-demand basis. As of February 28, 2015, the total
amount advanced and unpaid is $355,061.
The
Company is currently using the office space from its President and CEO and on rent free basis.
ITEM
2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION.
This
section of this annual report includes a number of forward-looking statements that reflect our current views with respect to future
events and financial performance. Forward-looking statements are often identified by words like: believe, expect, estimate, anticipate,
intend, project and similar expressions, or words which, by their nature, refer to future events. You should not place undue certainty
on these forward-looking statements, which apply only as of the date of this report. These forward-looking statements are subject
to certain risks and uncertainties that could cause actual results to differ materially from historical results or our predictions.
The
following discussion and analysis presents management's perspective of our business, financial condition, and overall performance.
This information is intended to provide investors with an understanding of our past performance, current financial condition,
and outlook for the future, and should be read in conjunction with our Audited Annual Financial Statements Form 10-K.
OVERVIEW
OF THE COMPANY
CN
Resources Inc. is an independent energy company engaged in the exploration, development, production, and sale of crude oil. Our
operations are conducted through a 100% wholly owned Ontario Corporation (also named CN Resources Inc.) which owns a producing
joint venture oil well in the Redwater area in Alberta, Canada.
The
Company’s immediate core strategy is to create and enhance shareholder value by acquiring proved developed and producing
light oil assets, optimize the producing assets to increase production and fully develop the assets potential for reserves. Management
believes that this is the best approach to create shareholder value based on risk and rewards analysis.
Results
of Operations
The
following is a discussion of our results of operations, financial condition and capital resources. You should read this discussion
in conjunction with our Financial Statements and the Notes thereto contained elsewhere in this Form 10-Q.
Oil
and gas industry has experienced a substantial decline in crude oil prices, as a result, many small leveraged oil and gas companies
are struggling in meeting its lenders demand. For the past Quarter ended February 28, 2015, the Company has taken the opportunity
of low oil price to perform the necessary maintenance and repair works for the joint venture well. As a result, the production
is significantly reduced and resulted in a small loss.
For
the Quarter ended February 28, 2015, the company only produced 420 barrels of crude oil, and resulted in an operating loss $7,673.
For the nine months ended February 28, 2015, we achieved an operating income of $119,305. Due to significant decrease in Canadian
dollar against United States dollars and all our operations are in Canadian dollars, we had an unrealized foreign currency loss
of $449,752.
Liquidity
and Capital Resources
On
May 28, 2014, we closed an equity financing of $6,000,000 and as at February 28, 2015, we have cash on hand of $275,556, notes
receivables on demand of $5,364,673, and oil revenue receivable of $22,901. We have no material third party debt other than debt
owed to our Director and Officer.
Planned
Capital Expenditures
The
Company is evaluating its various options in its development strategies, have not committed to any specific capital expenditure
at this time.
Off
Balance Sheet Arrangements
We
have no off-balance sheet arrangements.
ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
We
are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information under
this item.
ITEM
4. CONTROLS AND PROCEDURES.
Under
the supervision and with the participation of our management, including the Principal Executive Officer and Principal Financial
Officer, we have evaluated the effectiveness of our disclosure controls and procedures as required by Exchange Act Rule 13a-15(b)
as of the end of the period covered by this report. Based on that evaluation, the Principal Executive Officer and Principal Financial
Officer have concluded that these disclosure controls and procedures are not effective due to limited segregation of duties, lack
of independent directors, and no written internal control procedure manual. The Company plans to address the weakness in control
as soon as the Company considers that the financial situation allows the Company to spend the limited resources to mitigate the
weakness in control.
There
were no material changes in our internal control over financial reporting during the quarter ended February 28, 2015, that have
materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART
II. OTHER INFORMATION
ITEM
1. LEGAL PROCEEDINGS
We
are not aware of any pending or threatened litigation against us or our officers and director in their capacity as such.
ITEM
1A. RISK FACTORS
We
are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide
the information under this item.
ITEM
2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
There
is no change in securities in the three-month period ended February 28, 2015.
ITEM
6. EXHIBITS
Exhibit |
|
Description |
31.01 |
|
Certification
of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
32.01 |
|
Certification
of Chief Executive Officer and Chief 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 |
SIGNATURE
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.
|
CN Resources Inc. |
|
|
|
Date: April 20, 2015 |
By: |
/s/ Oliver
Xing |
|
|
Oliver Xing |
|
|
President,
Principal Executive Officer,
Principal
Accounting Officer,
Principal
Financial Officer,
Secretary/Treasurer
and sole member of the Board of Directors |
9
Exhibit
31.01
SARBANES-OXLEY
SECTION 302(a) CERTIFICATION
I,
Oliver Xing, certify that:
1. |
I have
reviewed this Form 10-Q for the period ended February 28, 2015 of CN Resources Inc.; |
|
|
2. |
Based
on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect
to the period covered by this report; |
|
|
3. |
Based
on my knowledge, the financial statements, and other financial information included in this report, fairly present in all
material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods
presented in this report; |
|
|
4. |
I am
responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)
and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for
the registrant and have: |
|
|
|
a. |
Designed
such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision,
to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to
us by others within those entities, particularly during the period in which this report is being prepared; |
|
|
|
|
b. |
Designed such internal
control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision,
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting principles; |
|
|
|
|
c. |
Evaluated the effectiveness
of the registrant’s disclosure controls and procedures and presented in this report my conclusions about the effectiveness
of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and, |
|
|
|
|
d. |
Disclosed in this
report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s
most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially
affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;
and |
|
|
|
5. |
I have
disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant’s auditors
and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
|
|
|
a. |
All significant
deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant’s ability to record, process, summarize and report financial information;
and |
|
|
|
|
b. |
Any fraud, whether
or not material, that involves management or other employees who have a significant role in the registrant’s internal
control over financial reporting. |
Date: April 20, 2015 |
/s/ Oliver Xing |
|
Oliver Xing |
|
Principal Executive Officer and
Principal Financial Officer |
Exhibit
32.01
CERTIFICATION
PURSUANT TO
18
U.S.C. Section 1350,
AS
ADOPTED PURSUANT TO
SECTION
906 OF THE SARBANES-OXLEY ACT OF 2002
In
connection with the Quarterly Report of CN Resources Inc. (the “Company”) on Form 10-Q for the period ended February
28, 2015, as filed with the Securities and Exchange Commission on the date hereof (the “report”), I, Oliver Xing,
Chief Executive Officer and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002, that:
|
(1) |
The
Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
|
(2) |
The
information contained in this Report fairly presents, in all material respects, the financial condition and results of operations
of the Company. |
Dated: April 20, 2015 |
/s/ Oliver Xing |
|
Oliver Xing |
|
Chief Executive Officer and
Chief Financial Officer |
CN Resources (GM) (USOTC:CNRR)
과거 데이터 주식 차트
부터 5월(5) 2024 으로 6월(6) 2024
CN Resources (GM) (USOTC:CNRR)
과거 데이터 주식 차트
부터 6월(6) 2023 으로 6월(6) 2024