Mdjm Ltd 6-K, filed Oct 14, 2022

Mdjm Ltd (UOKAF)

6-K 2022-10-14 For: 2022-06-30

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Added on April 06, 2026

About this 6-K

Mdjm Ltd filed this 6-K on October 14, 2022.

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	MDJM LTD

	By:	/s/ Siping Xu
		Siping Xu
		Chief Executive Officer


Exhibit No.		Description
99.1		Unaudited Condensed Consolidated Financial Statements for the Six Months Ended June 30, 2022 and 2021
101		Interactive Data Files (formatted as Inline XBRL)
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


Unaudited Condensed Consolidated Financial Statements	Page

Condensed Consolidated Balance Sheets as of June 30, 2022 and December 31, 2021	F-1
Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the six months ended June 30, 2022 and 2021	F-2
Unaudited Condensed Consolidated Statements of Changes in Shareholders’ Equity for the six months ended June 30, 2022 and 2021	F-4
Unaudited Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2022 and 2021	F-5
Notes to Condensed Consolidated Financial Statements	F-6


	June 30,		December 31,
	2022		2021
	(Unaudited)
Assets

Current Assets
Cash, cash equivalents, and restricted cash	$	5,029,611	$	5,744,078
Accounts receivable, net of allowance for doubtful accounts of $229,511 and $76,462, respectively		1,179,514		2,137,711
Prepaid expenses		3,736		29,031
Other receivables		87,170		98,594
Total Current Assets		6,300,031		8,009,414

Property and equipment, net		17,502		49,012

Other Assets
Deferred tax assets		14,413		15,382
Operating lease assets, net		—		224,127
Purchase deposit		194,791		—
Receivable from related parties		—		71,035
Total Other Assets		209,204		310,544
Total Assets	$	6,526,737	$	8,368,970

Liabilities and Equity

Current Liabilities:
Accounts payable and accrued liabilities	$	478,521	$	1,028,210
VAT and other taxes payable		28,871		136,126
Deferred income		22,209		23,091
Operating lease liabilities, current		—		162,735
Short-term loans payable		368,641		—
Total Current Liabilities		898,242		1,350,162

Long-term operating lease liabilities		—		61,392

Total Liabilities		898,242		1,411,554

Equity:
Ordinary shares: 50,000,000 shares authorized, par value: $0.001 per share, 11,675,216 and 11,675,216 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively		11,675		11,675
Additional paid in capital		6,845,394		6,845,394
Statutory reserve		327,140		327,140
Retained earnings		(1,553,440)		(282,791)
Accumulated other comprehensive (loss) income		(2,274)		62,903
Total MDJM Ltd stockholders’ equity		5,628,495		6,964,321
Noncontrolling interest		—		(6,905)
Total Liabilities and Equity	$	6,526,737	$	8,368,970


	2022		2021

Revenue	$	461,149	$	2,712,679

Operating Expenses:
Selling expenses		17,997		27,410
Payroll, payroll taxes and others		1,090,230		2,281,869
Professional fees		342,424		334,686
Operating leases expenses		—		59,658
Depreciation and amortization		12,804		12,147
Allowance for doubtful accounts, net		162,413		37,398
Other general and administrative		143,800		242,352
Total Operating Expenses		1,769,668		2,995,520

Loss from Operations		(1,308,519)		(282,841)

Other income (Expense):
Gain on sale of asset		13,934		—
Gain (loss) on foreign currency transactions		26,992		(6,229)
Interest (expense) income		(2,609)		11,236
Other income		6,601		41,392
Total other income		44,918		46,399

Loss before income tax		(1,263,601)		(236,442)
Income tax		—		5,321
Net loss		(1,263,601)		(231,121)
Net loss attributable to noncontrolling interest		—		(125)
Net loss attributable to MDJM Ltd ordinary shareholders	$	(1,263,601)	$	(230,996)

Net income (loss) per ordinary share attributable to MDJM Ltd ordinary shareholders - basic and diluted	$	(0.11)	$	(0.02)

Weighted-average shares outstanding, basic and diluted		11,675,216		11,675,216
Comprehensive income (loss):
Net Income (loss)	$	(1,263,601)	$	(231,121)
Other comprehensive income (loss), net of tax:
Change in foreign currency translation adjustments		(65,320)		51,087
Total other comprehensive income (loss)		(1,328,921)		(180,034)
Comprehensive income (loss) attributable to non-controlling interest		—		11,466
Comprehensive income (loss) attributable to MDJM Ltd ordinary shareholders	$	(1,328,921)	$	(191,500)


										Accumulated
	Ordinary Shares							Retained		Other
	Number of	Amount of		Additional Paid in				Earnings		Comprehensive		Noncontrolling
For the Six Months Ended June 30, 2022	Ordinary Shares	Ordinary Shares		Capital		Statutory Reserve		(Deficits)		Income (Loss)		Interest		Total Equity
Balance - December 31, 2021	11,675,216	$	11,675	$	6,845,394	$	327,140	$	(282,791)	$	62,903	$	(6,905)	$	6,957,416
Comprehensive income (loss):
Acquired noncontrolling interest	—		—		—		—		(7,048)		143		6,905		—
Net loss	—		—		—		—		(1,263,601)		—		—		(1,263,601)
Other comprehensive income (loss), net of tax:
Change in foreign currency translation adjustment	—		—		—		—		—		(65,320)		—		(65,320)
Balance - June 30, 2022	11,675,216	$	11,675	$	6,845,394	$	327,140	$	(1,553,440)	$	(2,274)	$	—	$	5,628,495


										Accumulated
	Ordinary Shares									Other
	Number of	Amount of		Additional Paid in				Retained		Comprehensive		Noncontrolling
For the Six Months Ended June 30, 2021	Ordinary Shares	Ordinary Shares		Capital		Statutory Reserve		Earnings		Income (Loss)		Interest			Total Equity
Balance - December 31, 2020	11,675,216	$	11,675	$	6,845,394	$	327,140	$	2,142,657	$	(37,558)	$	(173,820)	$	9,115,488
Comprehensive income (loss):
Net loss	—		—		—		—		(230,996)		—		(125)		(231,121)
Other comprehensive income (loss), net of tax:
Change in foreign currency translation adjustment	—		—		—		—		—		39,621		11,466		51,087
Balance - June 30, 2021	11,675,216	$	11,675	$	6,845,394	$	327,140	$	1,911,661	$	2,063	$	(162,479)	$	8,935,454


	2022		2021

Cash Flows from Operating Activities:
Net loss	$	(1,263,601)	$	(231,121)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		12,804		12,147
Changes in allowance for doubtful accounts		162,413		37,398
(Gain) loss on foreign currency transactions		(26,992)		6,229
Gain on sale of asset		(13,934)		—
Non cash operating lease expense		—		51,022
Non cash interest expense (income)		14		(1,885)
Changes in deferred tax assets		—		(5,321)
Changes in operating assets and liabilities:
Decrease in accounts receivables		712,438		404,396
Decrease (increase) in other receivables		5,698		(38,533)
Decrease (increase) in prepaid expense		92,828		(22,204)
Decrease in accounts payable and accrued expenses		(511,624)		(764,222)
Decrease in VAT and other tax payable		(100,955)		(43,221)
Increase in operating lease liabilities		—		5,795
Increase in deferred income		548		—
Net Cash Used in Operating Activities		(930,363)		(589,520)

Cash Flows from Investing Activities:
Purchase of office equipment and software		—		(3,351)
Proceeds from disposal of asset		31,037		—
Purchase deposit paid		(194,791)		—
Loan repayment received		771		7,730
Net Cash (Used in) Provided by Investing Activities		(162,983)		4,379

Cash Flows from Financing Activities:
Proceeds from short term loans		381,233		—
Net Cash Provided by Financing Activities		381,233		—
Effect of exchange rate changes on cash, cash equivalents, and restricted cash		(2,354)		6,964

Net decrease in cash, cash equivalents and restricted cash		(714,467)		(578,177)
Cash, cash equivalents, and restricted cash - beginning of the period		5,744,078		6,110,693
Cash, cash equivalents, and restricted cash - end of the period	$	5,029,611	$	5,532,516

Cash and cash equivalents	$	4,516,882	$	4,923,114
Restricted foreign currency		512,729		609,402
Total cash, cash equivalents, and restricted cash	$	5,029,611	$	5,532,516

Supplemental Disclosure Cash Flow Information:
Cash paid for:
Interest	$	2,306	$	—
Income taxes	$	—	$	—


	Date of	Place of	Percentage of
Name of the Company	Incorporation	Incorporation	Ownership
MDJM Hong Kong	February 9, 2018	Hong Kong	100%
MDJM UK	October 28, 2020	England and Wales	100%
Mansions Estate	June 15, 2021	England and Wales	100%
MD Japan	January 14, 2022	Japan	100%
MD German	February 16, 2022	Germany	100%
Mingda Beijing	March 9, 2018	PRC	100%
Mingda Tianjin	September 25, 2002	PRC	VIE


			Percentage
	Date of	Place of	of
Name of the Branch Offices of the VIE	Incorporation	Incorporation	Ownership
Mingda Jiahe (Tianjin) Co. Ltd. Suzhou Branch	October 13, 2017	Suzhou, China	N/A
Mingda Jiahe (Tianjin) Co. Ltd. Chengdu Branch	June 24, 2019	Chengdu, China	N/A


Office Equipment and Fixtures		3 or 5 years
Computers		3 years
Software		2 or 10 years
Vehicles		4 years


	Total Disposed				Office
	Assets		Auto		Equipment
Cost	$	79,330	$	47,412	$	31,918
Accumulated depreciation		(62,226)		(31,904)		(30,322)
Cash received		(31,038)		(30,857)		(181)
Net (gain) loss	$	(13,934)	$	(15,349)	$	1,415


	June 30,		December 31,
Deferred tax items	2022		2021
Accounts receivable, net	$	18,116	$	19,115
Net operating loss - UK		2,968		3,305
Valuation allowance		(6,671)		(7,038)
Deferred tax assets, net	$	14,413	$	15,382


	June 30,		June 30,
China	2022		2021
Hong Kong statutory income tax rate	16.50	%	16.50	%
Valuation allowance recognized with respect to the loss in Hong Kong Company	-16.50	%	-16.50	%
PRC statutory income tax rate	25.00	%	25.00	%
Effect of income tax exemptions and reliefs in the PRC companies	-25.00	%	-25.00	%
Effect of valuation and deferred tax adjustments	0.00	%	3.14	%
Effective rate	0.00	%	3.14	%

United Kingdom
UK statutory income tax rate	19.00	%	NA
Valuation allowance recognized with respect to the loss in UK	-19.00	%	NA
Effect of valuation and deferred tax adjustments	0.00	%	NA
Effective rate	0.00	%	0.00	%


Operating Lease Assets	June 30,		December 31,
	2022		2021
Main offices operating lease assets - initial measurement	$	—	$	479,744
Less: accumulated amortization		—		(275,382)
Foreign exchange effects		—		19,765
Operating Lease Assets, net	$	—	$	224,127

Operating Lease Liabilities
Total operating lease liabilities - initial measurement	$	—	$	479,744
Accrued interest		—		41,124
Accumulated payment to liabilities		—		(316,506)
Foreign exchange effects		—		19,765
Total operating lease liabilities		—		224,127
Less: operating lease liabilities, current		—		(162,735)
Long-term Operating Lease Liabilities	$	—	$	61,392


	Amount
Non-controlling interest at December 31, 2019	$	(178,806)
Net loss attributable to non-controlling interest - 2020		(4,146)
Foreign currency translation adjustment attributable to non-controlling interest		9,132
Noncontrolling interest at December 31, 2020	$	(173,820)
Deconsolidated non-controlling interest in 2021		173,820
Net loss attributable to non-controlling interest - 2021		(7,048)
Foreign currency translation adjustment attributable to non-controlling interest		143
Non-controlling interest at December 31, 2021	$	(6,905)
Reclassified to retained deficits - January 1, 2022		7,048
Reclassified to accumulated other comprehensive income - January 1, 2022		(143)
Non-controlling interest at June 30, 2022	$	—