Phoenix Rising Companies - Quarter Report: 2016 October (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2016

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission file number: 000-55319

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 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 past 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 (§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 x No o

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” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one).

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

As of December 19, 2016, there were 74,976,241 shares of the issuer’s common stock, par value $0.0001 per share, outstanding.

RESORT SAVERS, INC.

FORM 10-Q

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

Item 1. Unaudited Financial Statements.

The accompanying unaudited condensed consolidated financial statements 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 ("SEC"), and should be read in conjunction with the audited financial statements and notes thereto contained in the Company's January 31, 2016 Form 10-K filed with the Securities and Exchange Commission on May 13, 2016. 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 periods presented have been reflected herein. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year ending January 31, 2017.

RESORT SAVERS, INC.

Index to Unaudited Condensed Consolidated Financial Statements

October 31, 2016

RESORT SAVERS, INC.

Condensed Consolidated Interim Balance Sheets

The notes are an integral part of these condensed consolidated interim financial statements.

RESORT SAVERS, INC.

Condensed Consolidated Interim Statements of Operations and Comprehensive Loss

(Unaudited)

The notes are an integral part of these condensed consolidated interim financial statements. 

RESORT SAVERS, INC.

Condensed Consolidated Interim Statements of Cash Flows

(Unaudited)

The notes are an integral part of these condensed consolidated interim financial statements.

RESORT SAVERS, INC.

Notes to the Condensed Consolidated Interim Financial Statements

October 31, 2016

(Unaudited)

NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS

Resort Savers, Inc. (the “Company”) is a Nevada corporation incorporated on June 25, 2012. It is based in Shenzhen, the People’s Republic of China (the “PRC”). The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America, and the Company’s fiscal year end is January 31.

The Company makes investments and acquisitions into sound, transparent markets and industries throughout the world. The company has invested in a company principally engaged in the development and production of beverages, investment in agricultural business and import and export of products in the food and beverage industry, and a company principally engaged in the trading of oil, gas and lubricant. In Europe and worldwide, the Company is seeking to acquire and invest in global tourist and development assets that can be tailored to Chinese and American investment traveler.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company prepares its financial statements in accordance with rules and regulations of the Securities and Exchange Commission ("SEC") and accounting principles generally accepted ("GAAP") in the United States of America. The accompanying interim financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information in accordance with Article 8 of Regulation S-X and presented in US dollars.

In the opinion of management, all adjustments consisting of normal recurring entries necessary for a fair statement of the periods presented for: (a) the financial position; (b) the result of operations; and (c) cash flows, have been made in order to make the financial statements presented not misleading. The results of operations for such interim periods are not necessarily indicative of operations for a full year. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in the Company's 10-K filed with the Securities and Exchange Commission on May 13, 2016.

Principles of Consolidation

At October 31, 2016, the principal subsidiaries of the Company were listed as follows:

These consolidated financial statements include the accounts of the Company and its subsidiaries. All material intercompany balances and transactions have been eliminated.

Foreign Currency Translation and Re-measurement

The Company translates its foreign operations to U.S. dollar in accordance with ASC 830, “Foreign Currency Matters”.

The Company and its subsidiaries' functional currency and reporting currency is U.S. dollar, except Amuli and Tieshan Oil’s functional currency which is Chinese Renminbi (“RMB”).

The Company's subsidiaries, whose records are not maintained in that company's functional currency, re-measure their records into their functional currency as follows:

Gains and losses from these re-measurements were not significant and have been included in the Company's results of operations.

The Company's subsidiaries, whose functional currency is not the U.S. dollar, translate their records into U.S. dollar as follows:

Adjustments arising from such translations are included in accumulated other comprehensive income in shareholders’ equity.

Concentrations of Credit Risk

Cash includes cash at banks and demand deposits in accounts maintained with banks within the PRC. Total cash in these banks as of October 31, 2016 and January 31, 2016 amounted to $36,588 and $226,638, respectively, none of which is covered by insurance. The Company has not experienced any losses in such accounts and believes it is not exposed to any risks to its cash in bank accounts.

The Company’s financial instruments that are exposed to concentrations of credit risk primarily consist of its cash and cash equivalents, and accounts receivable. The Company places its cash and cash equivalents with financial institutions of high credit worthiness. At times, its cash and cash equivalents with a particular financial institution may exceed any applicable government insurance limits. The Company also reviews its accounts receivable on a timely manner. The Company’s management plans to assess the financial strength and credit worthiness of any parties to which it extends funds, and as such, it believes that any associated credit risk exposures are limited.

Tieshan Oil

During the nine-month period ended October 31, 2016, one customer accounted for approximately 51% of revenues of Tieshan Oil. During the year ended January 31, 2016, one customer accounted for approximately 80% of revenues of Tieshan Oil.

As of October 31, 2016, two customers accounted for approximately 86% of accounts receivable. As of January 31, 2016, two customers accounted for approximately 90% of accounts receivable. There was no significant changes of such concentrations of credit risk between October 31, 2016 and January 31, 2016.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. The estimates and judgments will also affect the reported amounts for certain revenues and expenses during the reporting period. Actual results could differ from these good faith estimates and judgments.

Financial Instruments

The Company follows ASC 820, "Fair Value Measurements and Disclosures", which defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity's own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3).

The three levels of the fair value hierarchy are described below:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

Property, plant and equipment

Property, plant and equipment are recorded at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of the term of the related lease or the estimated useful life of the asset. The useful lives are as follows:

Maintenance and repairs are charged to operations as incurred. Expenditures which substantially increase the useful lives of the related assets are capitalized. When properties are disposed of, the related costs and accumulated depreciation are removed from the accounts and any gain or loss is reported in the period the transaction takes place.

Investments in Companies Accounted for Using the Equity or Cost Method

In accordance with ASC 320-10, “Investments – Debit and Equity Securities,” investments in other non-consolidated entities are accounted for using the equity method or cost basis depending upon the level of ownership and/or the Company's ability to exercise significant influence over the operating and financial policies of the investee. When the equity method is used, investments are recorded at original cost and adjusted periodically to recognize the Company's proportionate share of the investees' net income or losses after the date of investment. When net losses from an investment accounted for under the equity method exceed its carrying amount, the investment balance is reduced to zero and additional losses are not provided for as the Company is not obligated to provide additional capital. The Company resumes accounting for the investment under the equity method if the entity subsequently reports net income and the Company's share of that net income exceeds the share of net losses not recognized during the period the equity method was suspended.

When an investment accounted for using the equity method issues its own shares, the subsequent reduction in the Company's proportionate interest in the investee is reflected in equity as an adjustment to paid-in-capital. The Company evaluates its investments in companies accounted for by the equity or cost method for impairment when there is evidence or indicators that a decrease in value may be other than temporary.

Goodwill

The Company tests goodwill for impairment on an annual basis, or more frequently if circumstances, such as material deterioration in performance or a significant number of store closures, indicate reporting unit carrying values may exceed their fair values. When evaluating goodwill for impairment, the Company may first perform a qualitative assessment to determine if the fair value of the reporting unit is more likely than not greater than its carrying amount. If the Company does not perform a qualitative assessment or if the fair value of the reporting unit is not more likely than not greater than its carrying amount, the Company calculates the implied estimated fair value of the reporting unit. If the carrying amount of goodwill exceeds the implied estimated fair value, an impairment charge to current operations is recorded to reduce the carrying value to the implied estimated fair value. During the nine months ended October 31, 2016, no impairment is considered to be required for goodwill. During the year ended January 31, 2016, $4,005,224 goodwill on Amuli was considered fully impaired and written off by the Company.

Accounting for the impairment of long-lived assets

The long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. It is reasonably possible that these assets could become impaired as a result of technology or other industry changes. Determination of recoverability of assets to be held and used is by comparing the carrying amount of an asset to future net undiscounted cash flows to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. During the nine months ended October 31, 2016 and the year ended January 31, 2016, the Company did not impair any long-lived assets except goodwill on Amuli mentioned above.

Revenue Recognition

The Company will recognize revenue from the sale of products and services in accordance with ASC 605, “Revenue Recognition.” Revenue will be recognized only when all of the following criteria are met: persuasive evidence for an agreement exists, delivery has occurred or services have been provided, the price or fee is fixed or determinable, and collection is reasonably assured.

Deferred Income Taxes and Valuation Allowance

The Company accounts for income taxes under ASC 740, “Income Taxes.” Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations. No deferred tax assets or liabilities were recognized as at October 31, 2016 and January 31, 2016.

Net Loss Per Share of Common Stock

The Company has adopted ASC Topic 260, “Earnings per Share,” (“EPS”) which requires presentation of basic EPS on the face of the income statement for all entities with complex capital structures and requires a reconciliation of the numerator and denominator of the basic EPS computation. In the accompanying financial statements, basic earnings (loss) per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.

The Company has no potentially dilutive securities, such as options or warrants, currently issued and outstanding.

Commitments and Contingencies

The Company follows ASC 450-20, “Loss Contingencies,” to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. There were no commitments or contingencies as of October 31, 2016 and January 31, 2016.

Recent Accounting Pronouncements

In May 2014 and again in August 2015, the Financial Accounting Standards Board issued amended accounting guidance on revenue recognition that will be applied to all contracts with customers. The objective of the new guidance is to improve comparability of revenue recognition practices across entities and to provide more useful information to users of financial statements through improved disclosure requirements. This guidance is effective for annual and interim periods beginning in 2019. Early adoption is permitted, but only beginning in 2018. The Company is currently assessing the impact of adoption on its consolidated financial statements.

Management has considered all recent accounting pronouncements issued since the last audit of our financial statements. The Company's management believes that these recent pronouncements will not have a material effect on the Company's financial statements.

NOTE 3 – GOING CONCERN

The Company's financial statements are prepared using accounting principles generally accepted in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet had sufficient revenues to cover its operating cost, and requires additional capital to commence its operating plan. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about its ability to continue as a going concern.

In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management's plan to obtain such resources for the Company include: sales of equity instruments; traditional financing, such as loans; and obtaining capital from management and significant stockholders sufficient to meet its minimal operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing any of its plans.

There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. In addition, profitability will ultimately depend upon the level of revenues received from business operations. However, there is no assurance that the Company will attain profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

NOTE 4 – CASH AND CASH EQUIVALENTS

Cash and cash equivalents include cash in banks, money market funds, and certificates of term deposits with maturities of less than three months from inception, which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of loss in value. The Company had $36,588 and $226,638 in cash and cash equivalents as at October 31, 2016 and January 31, 2016, respectively.

NOTE 5 – ACCOUNTS RECEIVABLES

The Company has performed an analysis on all of its accounts receivable and determined that all amounts are collectible by the Company. As such, all accounts receivable are reflected as a current asset and no allowance for bad debt has been recorded as of October 31, 2016. No bad debts were written off for the nine months ended October 31, 2016 and 2015. The Company’s accounts receivable consists of only trade receivables. As at October 31, 2016 and January 31, 2016, the Company had accounts receivable of $17,307,641 and $25,047,810, respectively.

Aging analysis of accounts receivable is as follows:

NOTE 6 – PREPAYMENTS

The prepayments of $23,274 and $1,678,461 as at October 31, 2016 and January 31, 2016, respectively, were made to the major suppliers of the Company to secure the supply of the raw materials of the oil segment.

NOTE 7 – EQUIPMENT

During the nine-month period ended October 31, 2016 and 2015, the Company recorded depreciation of $69,799 and $0, respectively.

NOTE 8 – INVESTMENT

On December 30, 2014, a stock purchase agreement was concluded between Worx America, Inc.("Worx"), and Xing Rui, giving RSSV 20% common equity interest in Worx, a Houston, TX based Research and Development Company. The acquisition was closed on March 20, 2015.

This investment was accounted for under equity method initially with cost of $2,000,000. During March 20, 2015 to April 30, 2015, the Company recognized $30,692 loss from its investment in Worx based on its proportionate share of Worx’s net loss during March 20, 2015 to April 30, 2015. The Company also had a proportionate unrealized loss from Worx’s investment held for sale of $62,000, as indicated in the statement of other comprehensive income. On May 1, 2015, the Company lost significant influence on Worx. Therefore, equity method was suspended and the cost method was applied. Accordingly, the $62,000 unrealized loss was removed from accumulated other comprehensive income and realized as equity loss on unconsolidated affiliate investment on May 1, 2015.

During the nine-month period ended October 31, 2016, the Company did not receive any investment income from Worx.

On June 6, 2016, Worx sold all of its assets (“Asset Sale”), including, but not limited to, its technologies and intellectual property, to Bay WorxRail, LLC (“Bay WorxRail”) for $1,000,000 (“Purchase Price”), subject to a holdback of $250,000 of the Purchase Price, pursuant to the terms set forth in that certain Asset Purchase Agreement, dated June 6, 2016, among Worx, Bay WorxRail, and Michael Zilai, as majority stockholder of Worx. The Company reviewed Worx's financial condition at July 31, 2016 and concluded that as a result of the Asset Sale there is a 100% impairment loss related to the Company’s investment in Worx, and recorded an impairment loss of $1,907,308, for the period ended October 31, 2016. As at October 31, 2016 and January 31, 2016, the Company’s carrying value of its Worx investment was $0 and $1,907,308, respectively.

NOTE 9 – GOODWILL

On January 29, 2016, the Company recognized goodwill of $1,979,787 on the acquisition of Tieshan Oil. The Company tests goodwill for impairment on an annual basis, or more frequently if circumstances, such as material deterioration in performance, indicate reporting unit carrying values may exceed their fair values. The Company recognized a goodwill impairment of $0 and $4,005,224 during the nine-month period ended October 31, 2016 and 2015, respectively.

NOTE 10 – ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

At October 31, 2016, the Company had trade payables of $28,435,945. At January 31, 2016, the Company had trade payables of $5,629,306, and $59,230 payable to third-party service providers.

NOTE 11 – SHORT-TERM LOAN

There are no provisions in the Company’s bank borrowings that would accelerate repayment of debt as a result of a change in credit ratings or a material adverse change in the Company’s business.

The Industrial and Commercial Bank of China is the lender of the loan. The interest rate is the interbank offered rate announced by the PRC authority on the business day just before the release of the loan, plus 51 basis point, which is 5.06% per annum. The term of borrowing is 1 year, which was drawn down as at December 31, 2015. The amount is denominated in Renminbi of RMB 20,000,000. The loan is secured by the personal guarantee of one of the shareholders and of his wife in an unlimited amount.

25% of the principal of the loan is to be repaid in the eleventh month of the term. The remaining is to be repaid on the maturity of the loan. The loan agreement contains provisions requiring payment of default interest in the event of default, and without specific financial covenants. Management of the Company believes the Company is in material compliance with the terms of the loan agreement.

During the nine months ended October 31, 2016, the Company fully repaid the loan of $3,080,000 (RMB 20,000,000).

During the nine-month period ended October 31, 2016 and 2015, the Company incurred interest of $100,425 and $0, respectively. On October 31, 2016 and January 31, 2016, the Company had a short-term loan balance of $0 and $3,080,000, respectively.

NOTE 12 – DEPOSITS RECEIVED

At October 31, 2016 and January 31, 2016, the deposits received from customers, who were unrelated to the Company, was $0 and $13,496,941 respectively.

NOTE 13 – STOCKHOLDERS’ EQUITY

The capitalization of the Company consists of the following classes of capital stock:

Preferred Stock

The Company has authorized 15,000,000 shares of preferred stock with a par value of $0.0001 per share. The Board of Directors are authorized to divide the authorized shares of Preferred Stock into one or more series, each of which shall be so designated as to distinguish the shares thereof from the shares of all other series and classes. No shares of preferred stock have been issued.

Common Stock

The Company has authorized 1,000,000,000 shares of common stock with a par value of $0.0001 per share. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the corporation is sought.

During the nine-month period ended October 31, 2016, no shares were issued by the Company.

During the year ended January 31, 2016, the Company issued the following shares:

As at October 31, 2016 and January 31, 2016, the Company had 74,976,241 common shares issued and outstanding.

The Company has no stock option plan, warrants or other dilutive securities.

Contingently Issuable Common Stock

On January 29, 2016, the Company entered into an exchange agreement with Mr. Yang Baojin (the “Agreement”), a citizen of the PRC, and Huaxin. Mr. Baojin is the president and majority owner of Tieshan Oil. The exchange was closed on January 29, 2016.

Pursuant to the Agreement, the Company issued 6,000,000 shares of its common stock, par value $0.0001, to Mr. Baojin, and Mr. Baojin delivered to Huaxin an ownership interest in Tieshan Oil such that Huaxin owns 51% of all ownership interests in Tieshan Oil, provided that 1,200,000 shares of the Company’s common stock (20% of the common stock to be delivered to Mr. Baojin) will be withheld by the Company for a period of 12 months in order to secure against breach, if any, by Mr. Baojin of his representations and warranties contained in the agreement, as well as to secure the fulfillment of his covenants and further obligations under the agreement. Accordingly, the Company excludes these shares from the calculation of common stock outstanding.

Additional Paid-In Capital

During the nine-month period ended October 31, 2016, related parties contributed additional paid-in capital in the amount of $141,509, to fund operating expenses.

During the year ended January 31, 2016, related parties contributed additional paid-in capital in the amount of $95,669, to fund operating expenses.

NOTE 14 – RELATED PARTY TRANSACTIONS

In support of the Company's efforts and cash requirements, it may rely on advances from related parties until such time that the Company can support its operations or attains adequate financing through sales of its equity or traditional debt financing. There is no formal written commitment for continued support by shareholders or directors. Amounts represent advances or amounts paid in satisfaction of liabilities. The advances were considered temporary in nature and were not formalized by a promissory note.

During the nine-month period ended October 31, 2016, related parties, who are shareholders of the Company, forgave debt, in the amount of $141,509 for payments made on behalf of the Company for operating expenses. The amount has been recognized as a contribution to capital.

During the nine-month period ended October 31, 2016, the Company received $68,865 advances from various directors and repaid $65,078. At October 31, 2016, the Company owed $12,695 to a director of the Company, $5,203 to a director of Xin Rui HK, $8,782 to directors of Huaxin, and $212,674 to directors of Amuli, for vendor payments made by those directors.

At October 31, 2016, the Company had amount due from related party of $15,617,989, who is the shareholder of the Company.

At January 31, 2016, the Company owed $12,773 to a director of Xin Rui HK, $12,695 to a director of the Company, $198,258 to a director of Amuli, and $18,168 to a relative of a director of Xin Rui HK for vendor payments made by those directors.

The Company does not have employment contracts with its key employees, including the controlling shareholders who are officers of the Company.

The amounts and terms of the above transactions may not necessarily be indicative of the amounts and terms that would have been incurred had comparable transactions been entered into with independent third parties.

NOTE 15 – COMMITMENTS AND CONTINGENCIES

The Company has no commitments or contingencies as of October 31, 2016 and January 31, 2016.

From time to time the Company may become a party to litigation matters involving claims against the Company. Management believes that it is adequately insured for its operations and there are no current matters that would have a material effect on the Company’s financial position or results of operations.

NOTE 16 – SEGMENTED INFORMATION

At October 31, 2016 and January 31, 2016, the Company operates in two industry segments, health beverage and oil and gas, and one geographic segment, China, where majority current assets and equipment are located.

Segment assets and liabilities at October 31, 2016 and January 31, 2016 were as follows:

Segment revenue and net loss for nine months ended October 31, 2016 and 2015 were as follows:

Segment revenue and net loss for three months ended October 31, 2016 and 2015 were as follows:

NOTE 17 – SUBSEQUENT EVENTS

Management has evaluated subsequent events through the date these financial statements were available to be issued. Based on our evaluation no material events have occurred that require disclosure.

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations.

Forward-Looking Statements

Except for historical information, this report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements involve risks and uncertainties, including, among other things, statements regarding our business strategy, future revenues and anticipated costs and expenses. Such forward-looking statements include, among others, those statements including the words "expects," "anticipates," "intends," "believes" and similar language. Our actual results may differ significantly from those projected in the forward-looking statements. Factors that might cause or contribute to such differences include, but are not limited to, those discussed in the sections "Business," "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations." You should carefully review the risks described in this Annual Report on Form 10-K and in other documents we file from time to time with the Securities and Exchange Commission ("SEC"). You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this report. We undertake no obligation to publicly release any revisions to the forward-looking statements or reflect events or circumstances after the date of this document.

Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements.

All references in this Form 10-Q to the "Company," "Resort Savers," "we," "us," or "our" are to Resort Savers, Inc.

Corporate Overview

Resort Savers, Inc. (the “Company” or “Resort Savers” or “RSSV”) was incorporated in the State of Nevada on June 25, 2012.  The Company was authorized to issue 1,000,000,000 shares of common stock, par value $0.0001 per share, and 15,000,000 shares of preferred stock, par value $0.0001 per share.  Our fiscal year end is January 31.  Resort Savers has limited cash on hand.  We have sustained losses since inception and have relied solely upon the sale of our securities for funding.  Resort Savers has never declared bankruptcy, been in receivership, or been involved in any kind of legal proceeding.

During the year ended January 31, 2016, the Company issued the following shares:

Worx America, Inc.

From January 2015 through March 2015, the Company, by and through its wholly owned subsidiary, Xing Rui International Investment Holding Group Co., Ltd., a Seychelles corporation (“Xing Rui”), acquired 20,068,750 common shares of Worx America, Inc. (“Worx”), a private company based in Houston, Texas, in exchange for $1,650,000 cash and 1,000,000 shares of common stock of BRI with a value of $350,000 were paid by the Company to Worx in exchange of 20,068,750 common shares of Worx, representing 20% of Worx's the then issued and outstanding voting common stock on a fully converted and diluted basis.  More specifically, (i) on January 28, 2015, $350,000 cash was paid by the Company to Worx in exchange of 5,403,728 common shares of Worx and (ii) on March 20, 2015, $1,300,000 cash and 1,000,000 shares of common stock of BRI with a value of $350,000 were paid by the Company to Worx in exchange of 14,665,022 common shares of Worx. This investment was accounted for under equity method with initial cost of $2,000,000.

Prior to June 6, 2016, Worx designed automated solutions for industrial, environmental and energy industries to improve efficiency and systems output.  The Worx automated robotic tank cleaning system reduced tank cleaning time, reduced or eliminated the need for personnel to enter tanks, and attempted to reduce the volume of solvents used to clean a tank. Actual results varied from tank to tank and involved variables including the product in the tank, physical condition of the tank such as corrosion, or amount of sludge accumulated. Prior to June 6, 2016, Worx was refining its product line to improve speed and efficiency.  Our investment in Worx had facilitated such development. We had hoped that our investment into what we believed was an important technology would give us early access to the technology, establish relationships in the industry, and allow us to assist Worx with the launch of its commercial products in China and other parts of Asia. However, on June 6, 2016, Worx sold all of its assets (“Asset Sale”), including, but not limited to, its technologies and intellectual property, to Bay WorxRail, LLC (“Bay WorxRail”) for $1,000,000 (“Purchase Price”), subject to a holdback of $250,000 of the Purchase Price, pursuant to the terms set forth in that certain Asset Purchase Agreement, dated June 6, 2016, among Worx, Bay WorxRail, and Michael Zilai, as majority stockholder of Worx. The Asset Sale by Worx resulted in the full impairment of our investment in Worx at the end of our second fiscal quarter of 2016.

Shenzhen Amuli Industrial Development Co. Ltd.

On October 1, 2015, the Company’s wholly-owned subsidiary, Xing Rui, by and through a newly formed People’s Republic of China (the “PRC”) corporation subsidiary HuaxinChangrong (Shenzhen) Technology Service Company Limited (“Huaxin”), completed a purchase from Xu Xiao Yun of sixty percent (60%) of the shares of Shenzhen Amuli Industrial Development Co. Ltd., a PRC corporation (“Amuli”), for 3,033,926 shares of the Company’s common stock.  The purchase price was valued $2,400,000.

Apart from the transactions described above, neither the Company nor any of its subsidiaries has a material relationship with either Mr. Xu Xiao Yun or Amuli.

Amuli is in development to become a large producer of the health beverage drink Kvass. Amuli has purchased equipment and is currently expanding its production facilities that are forecasted to generate sales and profits in 2016.

On October 9, 2015, we amended our certificate of incorporation to increase the maximum number of shares of common stock that the Company shall be authorized to have outstanding at any time to 1,000,000,000 shares.

Beijing YandongTieshan Oil Products Co., Ltd.

On January 29, 2016, the Company entered into an Exchange Agreement (the “Exchange Agreement”) with Mr. Yang Baojin, a citizen of the PRC, and Huaxin, which is a wholly owned subsidiary of Xing Rui, whereas Xing Rui itself is a wholly owned subsidiary of the Company. Mr. Baojin is the president and majority owner of Beijing YandongTieshan Oil Products Co., Ltd., a corporation organized under the laws of the PRC (“BYTOC”).

The Exchange Agreement provides that the Company will issue 6,000,000 shares of its common stock to Mr. Baojin, and Mr. Baojin will deliver to Huaxin an ownership interest in BYTOC such that Huaxin will own 51% of all ownership interests in BYTOC, provided that 1,200,000 shares of the Company’s common stock (20% of the common stock to be delivered to Mr. Baojin) will be withheld by the Company for a period of 12 months in order to secure against breach by Mr. Baojin of his representations and warranties contained in the Agreement, as well as to secure the fulfillment of his covenants and further obligations under the Exchange Agreement (the “Exchange”).  Therefore, pursuant to the terms of the Exchange Agreement, on January 29, 2016, the Company issued 4,800,000 shares of its common stock to Mr. Baojin.

BYTOC is principally engaged in the trading of oil, gas and lubricant products within the PRC. Apart from the transactions pursuant to the Exchange Agreement, neither the Company nor any of its subsidiaries has a material relationship with either Mr. Baojin or BYTOC.

Under the Exchange Agreement, Mr. Baojin guarantees, for five years, that BYTOC will have an annual net income of Renminbi (the currency of the PRC – “RMB”) 10 million.  To the extent that in any year the actual net income of BYTOC is less than RMB 10 million, then Mr. Baojin will pay Huaxin a cash payment equal to 51% of the shortfall.

The Exchange Agreement was approved by a written consent of the Board of Directors of the Company on January 29, 2016 and the closing of the transactions under the Exchange Agreement occurred concurrently with the execution and delivery of the Exchange Agreement.

As a result of the closing of the transactions under the Exchange Agreement, Huaxin now owns a majority of the ownership interest of BYTOC.  Pursuant to the Exchange Agreement, as soon as reasonably practicable following the closing, the parties will amend the articles of association and bylaws of BYTOC so as to require a vote of the majority of the ownership interests in BYTOC to (i) approve the acquisition of BYTOC by means of a merger, (ii) approve the sale of substantially all assets of BYTOC, (iii) liquidate, dissolve or wind-up the business and affairs of BYTOC, (iv) amend, alter or repeal any provision of the articles of association or bylaws of BYTOC, (v) create any class or series of capital stock of BYTOC, (vi) pay or declare any dividend or make any distribution on any shares of capital stock of BYTOC, (vii) issue any debt security, and/or (viii) elect each member of the board of directors of BYTOC.

The total value of the exchange, based on the value of the Company’s common stock as of the close of trading on January 28, 2016, was $3,435,000.

Kashi Jinju Colour Printing Packaging Co. LTD.

On May 12, 2015, the Company, by and through its wholly-owned subsidiary, Xing Rui signed a definitive Letter of Intent with the stockholders of Kashi Jinju Colour Printing Packaging Co. LTD., a PRC corporation ("Kashi Jinju") which manufactures cardboard boxes. The stockholders of Kashi Jinju and the Company intend to enter into a share exchange, wherein the stockholders of Kashi Jinju will exchange 80% of the issued and outstanding shares of stock of Kashi Jinju for 32,000,000 shares of the Company’s common stock.  As of October 31, 2016, the Company and Kashi Jinju are still working towards satisfying conditions of the Letter of Intent, including regulatory approvals and licensing in the PRC, which are required to close the transaction.

Our Board of Directors will be primarily responsible for investigating combination opportunities. However, we believe that business opportunities may also come to our attention from various sources, including professional advisors such as attorneys, accountants, securities broker-dealers, venture capitalists, members of the financial community and others who may present unsolicited proposals. We have no plan, understanding, agreements or commitments with any individual for such person to act as a finder of opportunities for us.

We do not propose to restrict our search for business opportunity to any particular geographical area or industry, and, therefore, we are unable to predict the nature of our future business operations. Our management's discretion in the selection of business opportunities is unrestricted, subject to the availability of such opportunities, economic conditions, and other factors.

The following discussion of our financial condition and results of operations should be read in conjunction with our financial statements for the period ended October 31, 2016, together with notes thereto, which are included in this report.

Results of Operations

During the three-month period ended October 31, 2016, the Company generated revenues of $15,712,231 with $15,616,456 cost of goods sold, incurred operating expenses of $175,973, other income of $77,528 and other expenses of $22,371, and had a net loss of $25,041. During the nine-month period ended October 31, 2016, the Company generated revenues of $62,824,020 with $62,419,608 cost of goods sold, incurred operating expenses of $575,844, other income of $77,528 and other expenses of $2,011,691, and had a net loss of $2,107,941.

The following table provides selected financial data about our company for the period ended October 31, 2016 and the year ended January 31, 2016.

For the three months ended October 31, 2016 and October 31, 2015

The following summary of our results of operations, for the three-months ended October 31, 2016 and 2015.

The following summary of comprehensive loss, for the three-months ended October 31, 2016 and 2015.

Revenues

The Company generated revenues of $15,712,231, and $0 during the three months ended October 31, 2016 and October 31, 2015, respectively. The increase in revenue was attributed to BYTOC acquired by the Company during the three months ended October 31, 2016.

Operating expenses

For the three months ended October 31, 2016, total operating expenses were $175,973, which included professional fees in the amount of $15,011 and general and administrative expenses of $160,962. For the three months ended October 31, 2015, total operating expenses were $21,166, which included professional fees in the amount of $21,166. The increase in general and administrative expenses was primarily related to increase in the scale of operation of the Company.

Other income

During the three months ended October 31, 2016 and 2015, the Company recognized other income of $77,528 and $0, respectively.

Interest expense

During the three months ended October 31, 2016 and 2015, the Company recognized interest expense of $22,371 and $0, respectively.

Goodwill impairment

During the three months ended October 31, 2016 and 2015, the Company recognized a goodwill impairment of $0 and $4,005,224, respectively.

Net loss

For the three months ended October 31, 2016, the Company had a net loss of $25,041, as compared to a net loss for the three months ended October 31, 2015 of $4,026,390.

Comprehensive income loss

For the three months ended October 31, 2016, the Company had other comprehensive loss of $92,757 as foreign currency translation adjustment. For the three months ended October 31, 2015, the Company had other comprehensive loss of $1,575 as foreign currency translation adjustment.

For the nine months ended October 31, 2016 and October 31, 2015

The following summary of our results of operations, for the nine months ended October 31, 2016 and 2015.

The following summary of comprehensive loss, for the nine-months ended October 31, 2016 and 2015.

Revenues

The Company generated revenues of $62,824,020 and $0 during the nine months ended October 31, 2016 and October 31, 2015, respectively. The increase in revenue was attributed to BYTOC acquired by the Company during the nine months ended October 31, 2016.

Operating expenses

For the nine months ended October 31, 2016, total operating expenses were $575,844, which included professional fees in the amount of $72,565 and general and administrative expenses of $503,279. For the nine months ended October 31, 2015, total operating expenses were $79,082, which included professional fees in the amount of $71,932 and general and administrative expenses of $7,150. The increase in general and administrative expenses was primarily related to increase in the scale of operation of the Company while the increase in professional fees was primarily related to the Company’s ongoing regulatory requirements. 

Other income

During the nine months ended October 31, 2016 and 2015, the Company recognized other income of $77,528 and $0, respectively.

Interest expense

During the nine months ended October 31, 2016 and 2015, the Company recognized interest expense of $100,425 and $0, respectively.

Loss on investment

During the nine months ended October 31, 2016, the Company recognized an impairment loss on investment of $1,907,308. During the period ended October 31, 2016, the Company determined the investment in Worx did not have value and completely wrote down the investment. During the nine months ended October 31, 2015, the Company recognized $30,692 loss from its investment in Worx based on its proportionate share of Worx’s net loss during March 20, 2015 to April 30, 2015. Investment loss from May 1, 2015 to October 31, 2015 was not recognized since on May 1, 2015, the Company lost significant influence on Worx and equity method was suspended and the cost method was applied.

Goodwill impairment

During the nine months ended October 31, 2016 and 2015, the Company recognized a goodwill impairment of $0 and $4,005,224, respectively.

Net loss

For the nine months ended October 31, 2016, the Company had a net loss of $2,107,941, as compared to a net loss for the nine months ended October 31, 2015 of $4,114,998.

Comprehensive loss

For the nine months ended October 31, 2016, the Company had other comprehensive loss of $194,634 as foreign currency translation adjustment. For the nine months ended October 31, 2015, the Company also had a proportionate unrealized loss from Worx’s investment held for sale of $62,000, as indicated in the statement of other comprehensive income and other comprehensive loss of $1,575 as foreign currency translation adjustment.

Limited Operating History; Need for Additional Capital

There is limited historical financial information about us on which to base an evaluation of our performance since we were formed in June 2012.  We have only began to generate revenues since the beginning of this fiscal year 2016. We cannot guarantee we will be successful in our business operations.  Our business is subject to risks inherent in the establishment of a new business enterprise, including limited capital resources and possible cost overruns due to the price and cost increases in supplies and services.

If we are unable to meet our needs for cash from either our operations, or possible alternative sources, then we may be unable to continue, develop, or expand our operations.

Liquidity and Capital Resources

Working Capital

Cash Flows

As at October 31, 2016, the Company's cash balance was $36,588 compared to $226,638 as at January 31, 2016. The decrease in cash was primarily due to operating losses associated with the business operations of BYOTC during the nine months ended October 31, 2016.

As at October 31, 2016, the Company had current assets of $32,996,331 compared with current assets of $26,957,038 as at January 31, 2016 and as at October 31, 2016, the Company had current liabilities of $28,730,004 compared with current liabilities of $22,519,828 as at January 31, 2016. The increase was primarily attributed from the increase in receivables and payables of BYTOC.

As at October 31, 2016, our company had a working capital of $4,266,327 compared with working capital of $4,437,210 as at January 31, 2016. The decrease in working capital was primarily attributed to the decrease in accounts receivable of $7,740,169 and increase in accounts payable and accrued liabilities of $22,747,409 and the decrease in prepaid expense and deposits of $1,655,187 and decrease deposits received of $13,496,941.

Cash Flow from Operating Activities

During the nine months ended October 31, 2016, our company provided $2,932,539 in cash from operating activities compared to cash used by operating activities of $2,801 during the nine months ended October 31, 2015.

Cash Flow from Investing Activities

During the nine months ended October 31, 2016, our company used $0 cash for investing activities compared to $1,300,000 cash used for investment of Worx during the nine months ended October 31, 2015.