Renavotio 10Q 2019 Q2 Quarterly report

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 June 30, 2019

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

For the transition period from____________ to____________

Commission File Number 333-188401

SUCCESS ENTERTAINMENT GROUP INTERNATIONAL INC.

(Exact name of registrant as specified in its charter)

Nevada		99-0385424
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

215 North Jefferson, Box 591, Ossian, Indiana		46777
(Address of principal executive offices)		(Zip Code)

(260) 490-9990

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act: None

Title of each class		Trading Symbol(s)		Name of each exchange on which registered

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. x Yes ¨ No

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a small reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	¨	Non-accelerated Filer	x
Accelerated Filer	¨	Smaller reporting company	x
		Emerging growth company	¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ¨ Yes x No

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS

Check whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. ¨ Yes ¨ No

APPLICABLE ONLY TO CORPORATE ISSUERS

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

75,100,000 common shares issued and outstanding as of June 30, 2019.

SUCCESS ENTERTAINMENT GROUP INTERNATIONAL INC.

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

The unaudited financial statements of our company have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”) and are expressed in U.S. dollars.

SUCCESS ENTERTAINMENT GROUP INTERNATIONAL, INC.

CONSOLIDATED BALANCE SHEETS

	June 30			December 31
	2019			2018
	(Unaudited)
Assets
Current assets
Cash	$	43,923		$	520,772
Accounts receivable, net		87,391			436,153
Accounts receivable, net - related party		72,000			751,000
Prepayments		49,316			-
Other receivables - related party		259,942			138,230
Advance to director and Chief Executive Officer		397,124			151,759
Total Current Assets		909,696			1,997,913

Total Assets	$	909,696		$	1,997,913

Liabilities and Stockholders Equity
Current Liabilities
Accounts payable - related party	$	118,630		$	976,861
Accrued expenses		225,560			129,383
Other payables		7,631			5,145
Notes payable - related party		79,468			79,468
Loan payable- related party		138,549			143,325
Income tax payable		121,616			121,609
Total Current Liabilities		691,454			1,455,792

Total Liabilities		691,454			1,455,792

Commitments and Contingencies

Stockholders’ Equity
Common stock, $0.001 par value, 500,000,000 shares authorized:
75,100,000 and 75,000,000 shares issued and outstanding		75,100			75,000
Additional paid in capital		126,240			26,340
Retained earnings		18,019			442,240
Accumulated other comprehensive loss		(1,117	)		(1,459	)
Total stockholders’ equity		218,242			542,121
Total liabilities and stockholders’ equity	$	909,696		$	1,997,913

See Notes to Financial Statements

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SUCCESS ENTERTAINMENT GROUP INTERNATIONAL, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(UNAUDITED)

	For the Three Months Ended					For the Six Months Ended
	June 30					June 30
	2019			2018		2019			2018

Revenues	$	82,834		$	327,000	$	194,641		$	573,000
Cost of Revenues		82,858			50,000		98,858			90,000
Gross Profit		(24	)		277,000		95,783			483,000

Operating Expenses
General and Administrative		329,859			107,951		520,004			250,558

Net Income (Loss) from Operation before Income Taxes		(329,883	)		169,049		(424,221	)		232,442

Provision for Income Taxes		(1,037	)		-		-			-

Net Income (Loss)	$	(328,846	)	$	169,049	$	(424,221	)	$	232,442

Other Comprehensive Income (Loss)
Foreign currency translation adjustment		(624	)		-		342			-

Comprehensive Income (Loss)	$	(329,470	)	$	169,049	$	(423,879	)	$	232,442

Earnings (Loss) per Common Share-Basic and Diluted	$	(0.00	)	$	0.00	$	(0.00	)	$	0.00

Weighted Average Number of Common
Shares Outstanding Basic and diluted		75,059,341			75,000,000		75,029,834			75,000,000

See Notes to Financial Statements

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SUCCESS ENTERTAINMENT GROUP INTERNATIONAL, INC.

STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE SIX MONTHS ENDED JUNE 30, 2019 and 2018

(UNAUDITED)

	Common Stock				Additional Paid-In		Retained			Accumulated Other Comprehensive
	Shares		Amount		Capital		Earnings			Loss			Total
Balance, December 31, 2017		75,000,000	$	75,000	$	26,340	$	(204,937	)	$	-		$	(103,597	)

Net income for the three months ended March 31, 2018		-		-		-		63,393			-			63,393
Balance, March 31, 2018		75,000,000		75,000		26,340		(141,544	)		-			(40,204	)
Net income for the three months ended June 30, 2018		-		-		-		169,049			-			169,049
Balance, June 30, 2018		75,000,000	$	75,000	$	26,340	$	27,505		$	-		$	128,845
Balance, December 31, 2018		75,000,000	$	75,000	$	26,340	$	442,240		$	(1,459	)	$	542,121
Foreign currency translation adjustment		-		-		-		-			966			966

Net income for the three months ended March 31, 2019		-		-		-		(95,375	)		-			(95,375	)
Balance, March 31, 2019		75,000,000		75,000		26,340		346,865			(493	)		447,712
Shares issued for compensation		100,000		100		99,900								100,000
Foreign currency translation adjustment		-		-		-		-			(624	)		(624	)

Net income for the three months ended June 30, 2019		-		-		-		(328,846	)		-			(328,846	)

Balance, June 30, 2019		75,100,000	$	75,100	$	126,240	$	18,019		$	(1,117	)	$	218,242

See Notes to Financial Statements

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SUCCESS ENTERTAINMENT GROUP INTERNATIONAL, INC.

STATEMENTS OF CASH FLOWS

(UNAUDITED)

	For the Six Months Ended
	June 30
	2019			2018
Operating Activities
Net income (loss) of the period	$	(424,221	)	$	232,442
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Foreign currency translation adjustment		342			-
Stock based compensation		100,000			-
Change in assets and liabilities
Accounts receivable (increase) decrease		1,027,762			(155,000	)
Prepayments (increase) decrease		(49,316	)		-
Other receivables (increase) decrease		(121,713	)		(24,601	)
Advance to director (increase) decrease		(245,365	)		(115,361	)
Accounts payable increase (decrease)		(858,231	)		(16,000	)
Accrued expenses increase (decrease)		96,178			(10,968	)
Other payables increase (decrease)		2,486			25,000
Income tax payables increase (decrease)		7			-
Net cash used in operating activities		(472,072	)		(64,488	)

Financing Activities
Loans from related parties		(4,776	)		12,694
Net cash provided by (used in) financing activities		(4,776	)		12,694

Net decrease in cash and equivalents		(476,848	)		(51,794	)

Cash and equivalents at beginning of the period		520,772			54,742
Cash and equivalents at end of the period	$	43,923		$	2,949

Supplemental cash flow information:
Interest paid	$	-		$	-
Income taxes paid	$	-		$	-

See Notes to Financial Statements

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SUCCESS ENTERTAINMENT GROUP INTERNATIONAL, INC.

NOTES TO FINANCIAL STATEMENTS

(UNAUDITED)

NOTE 1 – ORGANIZATION AND NATURE OF BUSINESS

Success Entertainment Group International, Inc. (the “Company”, “we”, “us”, or “our”) was incorporated in the State of Nevada on January 30, 2013 under the name Altimo Group Corp and its initial business plan was to place and operate frozen yogurt making machines.

Effective July 14, 2014, there was a change in control of the Company. Pursuant to the change in ownership, the focus and direction of the Company will now be the production and development of internet movies and training films.

On December 1, 2014 the Board of Directors of the Company authorized an amendment to its Bylaws to change the Company’s fiscal year end From March 31 to December 31.

On December 2, 2014, our Board of Directors accepted the resignation of Steve Chen as the Chief Executive Officer and appointed Chris (Chi Jui) Hong as the Chief Executive Officer and a member of the Board of Directors. Following this appointment, our Board of Directors consists of three members: (i) Steve Andrew Chen; (ii) Brian Kistler; and (iii) Chris (Chi Jui) Hong.

On November 19, 2015, the Company acquired 100% shares of Double Growth Investment Ltd. On December 9, 2015, the Company acquired 100% shares of Coronet Limited, Fortunate Yields Limited, Solution Elite Limited, Ultimate Concept Limited, Viva Leader Limited. All these subsidiaries were registered in Republic of Seychelles. The Company made these acquisitions for future investment purpose. In 2016, the Company discontinued Coronet Limited, Fortunate Yields Limited, Solution Elite Limited, Ultimate Concept Limited, Viva Leader Limited by non-payment of the annual renewal fee.

On December 14, 2017, the Company acquired 100% shares of Success Events (Hong Kong) Limited, a company registered in Hong Kong Special Administrative Region. Success Events (Hong Kong) Limited holds 60% shares of Shenzhen Internet Media Co., Ltd. and 100% shares of Distribution Network Inc. Shenzhen Internet Media Co., Ltd was registered in China. Distribution Network Inc. was registered in Seychelles and its main business is holding seminar in Great China Area.

On February 28, 2018, Success Events (Hong Kong) Limited transferred 60% shares of Shenzhen Internet Media Co., Ltd. to a company in China. Shenzhen Internet Media Co., Ltd. is no longer a subsidiary of the Company.

On May 30, 2018, Success Events (Hong Kong) Limited acquire 100% shares of Success Win (Shanghai) Co., Ltd.

On February 27, 2019, SEGN Taiwan Limited was incorporated in Taiwan and the Company holds 100% of its shares.

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Interim Financial Statements

The accompanying unaudited financial statements have been prepared in accordance with the instructions from Regulation S-X and do not include all of the information and disclosures required by generally accepted accounting principles for complete financial statements. All adjustments which are, in the opinion of management, necessary for a fair presentation of the results of operations for the interim period(s), and to make the financial statements not misleading, have been made and are of a recurring nature unless otherwise disclosed herein. The results of operations for such interim period(s) are not necessarily indicative of operations for a full year.

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Basis of Presentation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America and are presented in US dollars.

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and all its majority-owned subsidiaries which require consolidation. Inter-company transactions have been eliminated in consolidation.

Reclassification

Certain amounts in the prior period financial statements have been reclassified to conform to the current period presentation. These reclassifications had no effect on reported losses.

Translation Adjustment

For the six months ended June 30, 2019, the accounts of the Success Win (Shanghai) Co., Ltd. were maintained, and its financial statements were expressed, in Chinese renmimbi (RMB). Such financial statements were translated into USD in accordance with the Foreign Currency Matters Topic of the Codification (ASC 830), with the RMB as the functional currency. According to the Codification, all assets and liabilities were translated at the current exchange rate at respective balance sheets dates, members’ capital are translated at the historical rates and income statement items are translated at the average exchange rate for the period. The resulting translation adjustments are reported under other comprehensive income in accordance with the Comprehensive Income Topic of the Codification (ASC 220), as a component of members’ capital. Transaction gains and losses are reflected in the income statement.

Comprehensive Income

The Company uses SFAS 130 “Reporting Comprehensive Income” (ASC Topic 220). Comprehensive income is comprised of net income and all changes to the statements of members’ capital, except those due to investments by members, changes in paid-in capital and distributions to members. Comprehensive income for the six months ended June 30, 2019 is included net income and foreign currency translation adjustments.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles 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 the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Cash and Cash Equivalents

The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents. The Company had $43,923 of cash as of June 30, 2019.

The Company’s bank accounts are deposited in insured institutions. At June 30, 2019, the Company’s bank deposits did not exceed the insured amounts.

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Accounts Receivable

Accounts receivable are stated at the amount management expects to collect from outstanding balances.

Management provides for probable uncollected amounts through a charge to earnings and a credit to an allowance for bad debts based on its assessment of the current status of individual accounts. Balances that are still outstanding after management has used reasonable collection efforts are written off through a charge to the allowance for bad debts and a credit to accounts receivable.

Fair Value of Financial Instruments

ASC 820 “Fair Value Measurements and Disclosures” establishes a three-tier fair value hierarchy, which prioritizes the inputs in measuring fair value. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market.

These tiers include:

Level 1: defined as observable inputs such as quoted prices in active markets;

Level 2: defined as input other than quoted market prices that are observable, either directly or indirectly, and reasonably available. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability and are developed based on market data obtained from sources independent of the Company.

Level 3: defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The Company’s financial instruments consist of cash, a related party loan and note payable related party. The carrying amount of these financial instruments approximates fair value due their short-term maturity.

Income Taxes

Income taxes are computed using the asset and liability method. Under the asset and liability method, deferred income tax assets and liabilities are determined based on the differences between the financial reporting and tax bases of assets and liabilities and are measured using the currently enacted tax rates and laws. A valuation allowance is provided for the amount of deferred tax assets that, based on available evidence, are not expected to be realized.

Revenue Recognition

The Company will recognize revenue in accordance with ASC. 605, “Revenue Recognition”. ASC-605 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management’s judgments regarding the fixed nature of the selling prices of the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company will defer any revenue for which the product has not been delivered or is subject to refund until such time that the Company and the customer jointly determine that the product has been delivered or no refund will be required.

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The major revenue streams of the Company are a series of human spirit stimulation training seminars. Training seminars have their agenda and speaking topics and other decoration details defined within the contract. The Company recognizes revenue when services have been provided, and collection is reasonably assured.

Advertising Costs

The Company policy regarding advertising is to expense advertising when incurred. The Company incurred advertising expense of $0 for the six months ended June 30, 2019.

Stock-Based Compensation

Stock-based compensation is accounted for at fair value in accordance with ASC Topic 718.

As of June 30, 2019, the Company has authorized a Non-Qualified Stock Incentive Plan and filed a corresponding Form S-8 on April 25, 2019. The Plan and S-8 registered 1,000,000 shares of common stock, $0.001 par value per share. Of this plan, 100,000 shares have been issued to President Brian Kistler.

Basic and Diluted Income (Loss) per Share

Per Share Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. Diluted earnings per share are the same as basic earnings per share due to the lack of dilutive items in the Company.

Recent Accounting Pronouncements

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on our financial condition or the results of its operations.

NOTE 3 – ACCOUNTS RECEIVABLE – RELATED PARTY

As of June 30, 2019, the Company has accounts receivable of $72,000, from Shanghai Kun-Xin Media Limited, under common control with the Company.

NOTE 4 – OTHER RECEIVABLES – RELATED PARTY

As of June 30, 2019, the Company has other receivables of $66,474, $46,000, $122,145, $3,000, $4,840 and $11,683 from Success Holding Group International, Inc., Success Entertainment Group Inc., Success Drink Group Inc., Success Holdings Group Corp. USA, SEGN Hong Kong Limited and Celebrity Enterprise Co., Ltd, subsidiaries under common control with the Company. The Company also has other receivables of $5,800 from Tony Chang, the Company’s Chief Operating Officer.

NOTE 5 – ADVANCE TO DIRECTOR

As of June 30, 2019, Chris (Chi Jui) Hong, (Chief Executive Officer and Director of the Company), had an outstanding payable amount of $397,124 to the Company, which the Company has advanced to him in order to pay our administrative and operating expenses.

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NOTE 6 – ACCOUNTS PAYABLE – RELATED PARTY

As of June 30, 2019, the Company has accounts payable of $78,630, to Shanghai Kun-Xin Media Limited, under common control with the Company, and $40,000 to Steve Andrew Chen who is the Company’s Chairman of the Board of Directors.

NOTE 7 – NOTES PAYABLE – RELATED PARTY

On April 24, June 7, July 5, and August 11, 2017, the Company entered into Promissory Note agreements for the outstanding amounts of $10,000, $10,000, $20,000, and $20,000, for a total of $60,000, with Hsu Wen Li, who is the wife of Chris (Chi Jui) Hong, the Company’s Chief Executive Officer and Director. The Notes matured throughout 2018 and bear no interest.

On May 15, 2017, the Company entered into a Promissory Note agreement for the outstanding amount of $24,500 with Steve Andrew Chen who is the Company’s Chairman of the Board of Directors. The maturity of the Note was May 15, 2018 and bears no interest.

On July 4, 2017, the Company entered into a Promissory Note agreement for the outstanding amount of $10,000 with Steve Andrew Chen who is the Company’s Chairman of the Board of Directors. The maturity of the Note was July 4, 2018 and bears no interest.

On October 17, 2017, the Company partially repaid Steve Andrew Chen $15,032 of the outstanding principal of the note issued on May 15, 2017.

NOTE 8 – LOAN PAYABLE – RELATED PARTY

Success Holdings Group Corp. USA, our parent company, paid certain operating costs on our behalf. The total amount owed as at June 30, 2019 is $138,549.

The loan is unsecured, non-interest bearing and due on demand.

NOTE 9 – COMMON STOCK

The Company has 500,000,000, $0.001 par value shares of common stock authorized.

On March 13, 2013, the Company issued 8,000,000 shares of common stock to a director for cash proceeds of $8,000 at $0.001.

On May 7, 2019, the Company issued 100,000 shares of common stock as compensation pursuant to the Company’s Non-Qualified Stock Incentive Plan. The compensation is valued at $100,000 based on market value of the shares on the date of issuance.

There were 75,100,000 shares of common stock issued and outstanding as of June 30, 2019.

NOTE 10 – COMMITMENTS AND CONTINGENCIES

Contractual

The Company neither owns nor leases any real or personal property. An officer has provided office services without charge. There is no obligation for the officer to continue this arrangement. Such costs are immaterial to the financial statements and accordingly are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved in other business activities in the future.

Legal

We were not subject to any legal proceedings on June 30, 2019 and no legal proceedings are pending or threatened to the best of our knowledge or belief.

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Item 2. Management’s Discussion and Analysis of Financial Condition or Plan of Operation

This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Our unaudited financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles. The following discussion should be read in conjunction with our financial statements and the related notes that appear elsewhere in this quarterly report. The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed below and elsewhere in this quarterly report.

Unless otherwise specified in this quarterly report, all dollar amounts are expressed in United States dollars and all references to “common stock” refer to shares of our common stock.

As used in this quarterly report, the terms “we”, “us”, “our” and “our company” mean Success Entertainment Group International Inc., unless otherwise indicated.

Corporate History

Our Company was incorporated in the State of Nevada on January 30, 2013 (Inception) under the name Altimo Group Corp., initially to engage in the sale of frozen yogurt machines.

In 2014, Marek Tomaszewski, our then majority shareholder, issued and sold 8,000,000 shares of our common stock, representing 77% of our outstanding common shares, to Success Holding Group Corp. USA, a Nevada corporation (“Success Holding”). Also, in 2014, we changed our name to “Success Entertainment Group International Inc.”, and the Company shifted its focus to the production and development of internet videos and training videos.

The Company signed several memorandums of understanding (“MOU”) for acquisitions in 2018:

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	·	On May 22, 2018, the Company signed an MOU with Magic Skin Technologies Company Ltd, acquiring a 20% interest; Magic Skin focuses on AI-car-detailing and data accumulation.

	·	On June 29, 2018, the Company signed an MOU with Harvest (Shanghai) Technologies Co., a company that focuses on data accumulation through a large database of customers as well as utilizing AI in on-line instruction.

	·	On July 23, 2018, signed an MOU with Beijing ZhongJu HuaDa Ltd., a company that would help establish a College of Commerce to utilize AI and education throughout Asia.

	·	On August 14, 2018, the Company signed an MOU with Taiwan EverLive Telomerase Ltd. with the objective of obtaining more patent rights for the companies.

	·	On September 19, 2018, the Company signed an MOU with Tai Fu Artificial Intelligence Co, Ltd., a large AI company located in Shenzen.

	·	On October 31, 2018, the Company signed an MOU with Taipei Artificial Intelligence (AI) Wallet Technology Co., a company focusing on a platform that allows use of virtual currencies and multi-cash in exchanges.

On February 5, 2019, the Company announced a new MOU with a Beijing AI company to establish a joint venture in Shanghai. None of the above described MOUs went into effect as of June 30, 219.

None of the MOUs described above have gone into effect as of June 30, 2019.

Current Business

Our operations are divided into three main categories. First is the “Know How” video sharing platform, which combines artificial intelligence (“AI”), short videos, social interaction, and education. Second is the production of Internet videos in China, for distribution in China, and on-line and off-line seminars conducted by Steve Chen. Specifically, we seek to produce commentary videos that will fit in internet mobile applications. In addition, we seek to sell distribution rights for these videos, and to develop and sell promotional and other products related to these videos throughout the world. Third, we are continuously seeking to make additional investments in other ventures that focus on AI and big data. Big data refers to the accumulation and analysis of large amounts of data.

Currently, our management is seeking and evaluating opportunities for our company to produce an internet video or participate in the production of an internet video as a financial partner, development partner, or production partner. In that regard we are seeking and evaluating video concepts, screenplays, financing opportunities, branding opportunities, and prospective creative and financial partners. We anticipate an operational budget of between $300,000 to $1,000,000 depending on the nature of our involvement, production costs, and available funding.

Results of Operations

Three months ended in June 30, 2019 compared to the three months ended in June 30, 2018.

Our operating revenue and expenses for the three-month periods ended June 30, 2019 and 2018 are outlined in the table below:

	Three months ended June 30, 2019			Three months ended June 30, 2018
Revenues	$	82,384		$	327,000
Cost of Revenues	$	82,858		$	50,000
General and administrative expenses	$	229,859		$	107,951
Net Income (Loss)	$	(228,846	)	$	169,049

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Revenues

For the three months ended June 30, 2019, we recorded $82,384 in revenues. During the same three-month period in 2018, we recorded $327,000 in revenue. The decrease in revenue was mainly due to a severe slowdown of economy in China, coupled with tightened control by the government particularly impacting seminar related industries which began late fourth quarter of 2018.and and into first half of 2019.

Cost of Revenues

For the three months ended June 30, 2019, we recorded $82,858 in cost of revenues. During the same three-month period in 2018, we recorded $50,000 in cost of revenue. The increase in cost of revenues was mainly due to additional costs of developing “Know-How” video sharing platform.

Operating Expenses and Net Loss

We had a net loss of $228,846 for the three months ended June 30, 2019. This is compared with net income of $169,049 for the same period in 2018. Operating expenses for the three months ended June 30, 2019 were $229,859 compared with $107,951 for the three months ended June 30, 2018. Our operating expenses during both periods consist primarily of general and administrative expenses which include professional fees (legal, accounting, audit), filing fees associated with the electronic filing of our public disclosure documents, travel expense, communications expenses (telephone, internet), and incidental office expenses (mail, courier, etc.). The increase in general and administrative expenses during the second three months in 2019 is mainly due to a series of business development trips in New York and San Francisco, transfer of staff from our sister company, Success Holding Group International, Inc., due to its dissolution, and change of commission structure which did not exist in 2018.

Liquidity and Capital Resources

Working Capital

	As at		As at
	June 30,		December 31,
	2019		2018
Current Assets	$	909,696	$	1,997,913
Current Liabilities	$	691,454	$	1,455,792
Working Capital	$	218,242	$	542,121

Cash Flows

	Six Months Ended June 30, 2019			Six Months Ended June 30 2018
Net cash used in operating activities	$	472,072		$	64,488

Net cash used in investing activities	$	-		$	-

Net cash provided by (used in) financing activities	$	(4,776	)	$	12,694

Net decrease in cash	$	476,848		$	51,794

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As of June 30, 2019, our total assets and liabilities were $909,696 and $691,454 compared to $1,997,913 and $1,455,792 as at December 31, 2018. Increase in cash used in operating activities for the six months ended June 30, 2019 is due to net loss and decrease in accounts payable.

As of June 30, 2019, we had working capital of $218,242 compared with working capital of $542,121 as of December 31, 2018. The decrease in our working capital is primarily due to much lower cash and accounts receivable.

Cashflow from Operating Activities

During the six months ended June 30, 2019, we used cash for operating activities of $472,072 compared to $64,488 during the six months ended Jun 30, 2018. This increase in cash used in operating expenses is primarily due to net loss and decrease in accounts payable.

Cashflow from Investing Activities

During the three months ended June 30, 2019, and 2018, we did not have any cash flow from investing activities.

Cashflow from Financing Activities

During the six months ended June 30, 2019, we repaid $4,776 for loans from related parties. During the six months ended June 30, 2018, we received proceeds of $12,694 from financing activities from related party loans.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to stockholders.

Future Financings

We will continue to rely on equity sales of our common shares in order to continue to fund our business operations. Issuances of additional shares will result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of the equity securities or arrange for debt or other financing to fund our operations and other activities.

Critical Accounting Policies

Use of Estimates

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Cash and Cash Equivalents

The Company considers all highly liquid investments with the original maturities of three months or less to be cash equivalents. The Company had $43,923 and $520,772 of cash as of June 30, 2019 and December 31, 2018, respectively.

The Company’s bank accounts are deposited in insured institutions. The funds are insured up to $250,000 each account. At June 30, 2019, and December 31, 2018, the Company’s bank deposits individually did not exceed the insured amounts.

Fair Value of Financial Instruments

These tiers include:

Level 1: defined as observable inputs such as quoted prices in active markets;

Level 2: defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and

Level 3: defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

Income Taxes

Revenue Recognition

The Company will recognize revenue in accordance with ASC-605, “Revenue Recognition”. ASC-605 requires that four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred; (3) the selling price is fixed and determinable; and (4) collectability is reasonably assured. Determination of criteria (3) and (4) are based on management’s judgments regarding the fixed nature of the selling prices of the products delivered and the collectability of those amounts. Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded. The Company will defer any revenue for which the product has not been delivered or is subject to refund until such time that the Company and the customer jointly determine that the product has been delivered or no refund will be required.

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Basic and diluted Income (Loss)

Recent Accounting Pronouncements

Recently Issued Accounting Pronouncements

Our company has implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and our company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

As a “smaller reporting company”, we are not required to provide the information required by this Item.

Item 4. Controls and Procedures

Management’s Report on Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our president (our principal executive officer, principal financial officer and principal accounting officer) to allow for timely decisions regarding required disclosure.

As of the end of our quarter covered by this report, we carried out an evaluation, under the supervision and with the participation of our president (our principal executive officer, principal financial officer and principal accounting officer), of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our president (our principal executive officer, principal financial officer and principal accounting officer) concluded that our disclosure controls and procedures were not effective in providing reasonable assurance in the reliability of our reports as of the end of the period covered by this quarterly report.

Changes in Internal Control over Financial Reporting

During the period covered by this report there were no changes in our internal control over financial reporting that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings

We know of no material, existing or pending legal proceedings against our company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which our director, officer or any affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

Item 1A. Risk Factors

As a “smaller reporting company”, we are not required to provide the information required by this Item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not Applicable.

Item 5. Other Information

None.

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Item 6. Exhibits

Exhibit Number		Description
(3)		Articles of Incorporation and Bylaws

3.1		Articles of Incorporation of the Registrant (1)

3.2		Bylaws of the Registrant (1)

(10)		Material Contracts

10.1		Sales Agreement (1)

10.2		Lease Agreement dated March 20, 2013 (1)

10.3		Amended and Restated Lease Agreement dated September 26, 2013 (2)

(31)		Rule 13a-14 (d)/15d-14d) Certifications

31.1*		Section 302 Certification by the Principal Executive Officer

31.2*		Section 302 Certification by the Principal Financial Officer and Principal Accounting Officer

(32)		Section 1350 Certifications

32.1*		Section 906 Certification by the Principal Executive Officer

32.2*		Section 906 Certification by the Principal Financial Officer and Principal Accounting Officer

101*		Interactive Data File

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

__________

(1)	Incorporated by reference to the same exhibit of our registration statement on Form S-1 filed with the Securities and Exchange Commission on May 7, 2013.
(2)	Incorporated by reference to the exhibit 10.3 of Amendment No. 1 to our Registration Statement on Form S-1 filed with the Securities and Exchange Commission on July 15, 2013.
*	Filed herewith

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SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	SUCCESS ENTERTAINMENT GROUP INTERNATIONAL INC.
	(Registrant)

Dated: August 14, 2019	By:	/s/ Chris Hong
		Chris Hong
		Chief Executive Officer and Director (Principal Executive Officer)

Dated: August 14, 2019	By:	/s/ Frank Tseng
		Frank Tseng
		Chief Financial Officer and Treasurer
		(Principal Financial Officer and Principal Accounting Officer)

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Renavotio (RIII) 10-Q2019 Q2 Quarterly report

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