Bemax Inc


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04/21/2017 | 09:28 pm

Forward Looking Statements

This report on Form 10-Q contains certain forward-looking statements. All
statements other than statements of historical fact are "forward-looking
statements" for purposes of these provisions, including any projections of
earnings, revenues, or other financial items; any statements of the plans,
strategies, and objectives of management for future operation; any statements
concerning proposed new products, services, or developments; any statements
regarding future economic conditions or performance; statements of belief; and
any statement of assumptions underlying any of the foregoing. Such
forward-looking statements are subject to inherent risks and uncertainties, and
actual results could differ materially from those anticipated by the
forward-looking statements.

Business Overview

Bemax Inc. is a Nevada -based company focusing on the distribution of disposable
baby diapers made in North America and Asia by quality producers to wholesalers
and retailers in Europe and the emerging markets. We are a development stage
corporation and have generated or realized minimal revenues from our business

Liquidity and Capital Resources

Cash Flows

Nine Months Nine Months
Ended Ended
February 28, 2017 February 29, 2016
$ $

Net Cash Provided By (Used In) Operating
Activities (256,132) (12,821 )
Net Cash Used by Investing Activities - -
Net Cash Provided By (Used In) Financing
Activities 141,000 40,000

We currently have minimal cash reserves. To date, the Company has covered
operating deficits primarily through loans from the sole director and third
party convertible notes. Accordingly, our ability to pursue our plan of
operations is contingent on our being able to obtain funding for the
development, marketing and commercialization of our products and services.
However, as a result of its lack of operating success, the Company may not be
able to raise additional funding to cover operating deficits.

The financial statements have been prepared assuming that the Company will
continue as a going concern. The Company has accumulated deficit of $1,427,971
since inception (November 28, 2012) to the period ended February 28, 2017 and is
dependent on its ability to raise capital from shareholders or other sources to
sustain operations. However, these conditions raise substantial doubt about the
Company's ability to continue as a going concern. The financial statements do
not include any adjustments that might result from the outcome of this


Management's Fiscal Quarter Report on Internal Control over Financial Reporting.

Our management is responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in Rules 13a-15(f) and
15d-15(f) of the Exchange Act. Our internal control system was designed 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 in the United States of America.
Our internal control over financial reporting includes those policies and
procedures that (i) pertain to the maintenance records that, in reasonable
detail, accurately and fairly reflect the transactions and dispositions of the
assets of the Company; (ii) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in
accordance with accounting principles generally accepted in the United States of
, and that receipts and expenditures of the Company are being made only
in accordance with authorizations of management of the Company; and (iii)
provide reasonable assurance regarding prevention or timely detection of
unauthorized acquisition, use, or disposition of the Company's assets that could
have a material effect on the financial statements. Management has determined
that internal control are not effective.

Because of inherent limitations, a system of internal control over financial
reporting may not prevent or detect misstatements. Also, projections of any
evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate due to change in conditions, or that the degree
of compliance with the policies or procedures may deteriorate.

Results of Operations


The Company had $24,960 in sales for the three months ended February 28, 2017
compared to $246,119 for period ended February 29, 2016. This reduction is due
to inability to secure viable and less dilutive financing to effectively finance
purchase orders.

Sales for the nine months ended February 28, 2017 is $140,113 compared to
$306,419 for the nine months ended February 29, 2016. The reduction is due to
less purchase order received from the Company's distributors during this period.

Operating Expense

The total operating expense for the three months ended February 28, 2017 is
$79,558 compared to $10,859 for the three months ended February 29, 2016 and
$102,542 compared to the nine months ended February 28, 2017. The increase is
due to increase in general and administrative expenses relating to product
bagging, packaging and consulting.

The total costs of goods for the nine month period ended February 28, 2017 is
$106,200 compared to $266,864 for the same nine month period ending February 29,
. The reason for the decrease is due to reduction in sales.


Interest Expenses

Total interest expense and loan fees for the nine months ended February 28, 2017
is $53,001 compared to $1,714 interest on loan during the nine month period
ended February 29, 2016.


The amounts presented in the financial statements do not provide for the effect
of inflation on our operations or financial position. The net operating losses
shown would be greater than reported if the effects of inflation were reflected
either by charging operations with amounts that represent replacement costs or
by using other inflation adjustments.

Off-Balance Sheet Arrangements

As of February 29, 2017, we had no off-balance sheet transactions that have or
are reasonably likely to have a current or future effect on our financial
condition, changes in our financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital resources.

The Company is working toward the introduction of new products including Diapers
with wet indicators, wipes and newer version of pull -ups. The company will
introduce better pricing including reduced shipping cost to accommodate larger
segment of online customers.

The Company continue working on several business development projects to
increase sales and generate revenues, including introducing the Company's
private label brands to other broad online market platforms such as Shopify and
Amazon prime. The Company will continue to expand both manufacturing and
distribution network with quality manufacturers and established distributors to
enhance regional and global expansion strategy.

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