Advanced Biomedical Technologies Inc.

Shenzhen Changhua Biomedical Engineering Company Limited (“Shenzhen Changhua”) was incorporated in the People’s Republic of China (“PRC”) on September 25, 2002 as a limited liability company with a registered capital of $724,017. Shenzhen Changhua is owned by two stockholders in the proportion of 70% and 30% respectively.

Sales for the 6 months ended 30 April 2021 amounted to US$47,328 (2019: US$60,290) were made to a company in which Mr. Chen Tie Jun has a significant equity interest.

Total other (expenses) income, for the three and six months ended April 30, 2021 and 2020 were ($75,939), ($89,318), ($159,341) and ($53,462) respectively. There was no significant changes in total other income and expenses for the three and six months ended April 30, 2021 except that during the six months ended 30 April 2020, the Company received a Biomedical Incentive Award of US$125,566 from the government of Shenzhen Longgang District where our facilities are located, in recognition of the Company’s achievement of obtaining a Class III medical device permit from China’s NMPA. The remaining other expenses comprised mainly interest expenses with no significant differences between the relevant periods of 2021 and 2020.

Net cash used in operating activities was $662,072 and $206,897 in the six months ended April 30, 2021 and 2020 respectively. This amount was attributable primarily to the net loss after adjustment for non-cash items, such as depreciation, loss on disposal of property and equipment, imputed interest on advances from directors, and stock-based compensation expenses. The change in operating assets and liabilities include inventory, other receivables and prepaid expenses and other payables and accrued expenses. In short, cash used in operating activities increased were a result of increased in operating loss, build-up of inventory, increment in other receivables and prepared expenses assets, and reduction in other payables and accrued expenses liabilities. Other items had no significant changes.

Net cash provided by financing activities in the six months ended April 30, 2021 and 2020 was $510,621 and $240,265 respectively, which represented advances from a stockholder, directors and related parties, payment to operating lease with principal and interest. The significant increase in the cash provided by financing activities was loan from related parties which was the current financing source of the Company.