UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the Quarterly Period Ended September 30, 2023

☐ 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 001-38308

Greenpro Capital Corp.

(Exact name of registrant issuer as specified in its charter)

Nevada

98-1146821

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

B-23A-02, G-Vestor Tower,

Pavilion Embassy, 200 Jalan Ampang,

50450 W.P. Kuala Lumpur, Malaysia

(Address of principal executive offices, including zip code)

Registrant’s phone number, including area code (603) 8408 - 1788

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Common Stock, $0.0001 par value		GRNQ		NASDAQ Capital Market

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 ☒ 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 (section 232.405 of this chapter) during the preceding twelve months (or shorter period that the registrant was required to submit and post such files).

Yes ☒ No ☐

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,” “smaller reporting company” or an “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer ☐	Accelerated Filer ☐
Non-accelerated Filer ☒	Smaller reporting company ☒
	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 ☐ No ☒

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to 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.

As of November 13, 2023, there were 7,575,813 shares of the registrant’s Common Stock, par value $0.0001, issued and outstanding.

TABLE OF CONTENTS

		Page

PART I	FINANCIAL INFORMATION	3

ITEM 1.	CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:	3

	Condensed Consolidated Balance Sheets - September 30, 2023 (Unaudited) and December 31, 2022	3

	Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - Three and Nine Months Ended September 30, 2023 and 2022	4

	Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) - Three and Nine Months Ended September 30, 2023 and 2022	5

	Condensed Consolidated Statements of Cash Flows (Unaudited) - Nine Months Ended September 30, 2023 and 2022	6

	Notes to Condensed Consolidated Financial Statements (Unaudited) - Nine Months Ended September 30, 2023 and 2022	7

ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	24

ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	31

ITEM 4.	CONTROLS AND PROCEDURES	31

PART II	OTHER INFORMATION	32

ITEM 1	LEGAL PROCEEDINGS	32

ITEM 2	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	32

ITEM 3	DEFAULTS UPON SENIOR SECURITIES	32

ITEM 4	MINE SAFETY DISCLOSURES	32

ITEM 5	OTHER INFORMATION	32

ITEM 6	EXHIBITS	32

SIGNATURES		33

PART I – FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements.

GREENPRO CAPITAL CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF SEPTEMBER 30, 2023 AND DECEMBER 31, 2022

(In U.S. dollars, except share and per share data)

	September 30, 2023			December 31, 2022
	(Unaudited)			(Audited)
ASSETS
Current assets:
Cash and cash equivalents (including $63,847 and $38,466 of restricted cash as of September 30, 2023 and December 31, 2022, respectively)	$	2,559,285		$	3,911,535
Accounts receivable, net of allowance of $24,534 and $25,677 as of September 30, 2023 and December 31, 2022, respectively (including $308,621 and $129,292 of net accounts receivable from related parties as of September 30, 2023 and December 31, 2022, respectively)		406,031			169,537
Prepaids and other current assets (including $120,000 and $80,000 of deposit paid to a related party as of September 30, 2023 and December 31, 2022, respectively)		700,221			773,040
Due from related parties		719,776			265,772
Deferred cost of revenue (including $0 and $11,640 to a related party as of September 30, 2023 and December 31, 2022, respectively)		83,479			168,605
Total current assets		4,468,792			5,288,489

Property and equipment, net		2,308,702			2,513,567
Real estate investments:
Real estate held for sale		1,659,207			1,659,207
Real estate held for investment, net		589,776			650,223
Intangible assets, net		1,357			1,900
Goodwill		82,561			82,561
Other investments (including $5,082,106 and $5,406,106 of investments in related parties as of September 30, 2023 and December 31, 2022, respectively)		5,082,106			5,406,106
Operating lease right-of-use assets, net		137,252			17,510
Finance lease right-of-use asset, net		26,363			-
Other non-current assets		-			19,643
TOTAL ASSETS	$	14,356,116		$	15,639,206

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	625,523		$	758,909
Due to related parties		436,578			448,251
Income tax payable		2,890			858
Operating lease liabilities, current portion		93,515			18,725
Finance lease liabilities, current portion		3,292			-
Deferred revenue (including $236,800 and $849,400 from related parties as of September 30, 2023 and December 31, 2022, respectively)		1,340,911			1,834,244
Derivative liabilities		-			1
Total current liabilities		2,502,709			3,060,988

Operating lease liabilities, non-current portion		43,737			-
Finance lease liabilities, non-current portion		14,190			-
Total liabilities		2,560,636			3,060,988

Commitments and contingencies		-			-

Stockholders’ equity:
Preferred stock, $0.0001 par value; 100,000,000 shares authorized; no shares issued and outstanding		-			-
Common Stock, $0.0001 par value; 500,000,000 shares authorized; 7,575,813 and 7,875,813 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively		7,576			7,876
Additional paid in capital		42,897,029			50,102,729
Accumulated other comprehensive loss		(365,087	)		(224,891	)
Accumulated deficit		(31,041,402	)		(37,622,680	)
Total Greenpro Capital Corp. stockholders’ equity		11,498,116			12,263,034
Non-controlling interest in a consolidated subsidiary		297,364			315,184

Total stockholders’ equity		11,795,480			12,578,218

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	14,356,116		$	15,639,206

See accompanying notes to the condensed consolidated financial statements.

GREENPRO CAPITAL CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME (LOSS)

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022

(In U.S. dollars, except share and per share data)

(Unaudited)

	2023			2022			2023			2022
	Three months ended September 30,						Nine months ended September 30,
	2023			2022			2023			2022

REVENUES:
Service revenue (including $648,377 and $41,431 of service revenue from related parties for the three months ended September 30, 2023, and 2022, respectively, and $1,232,526 and $548,602 of service revenue from related parties for the nine months ended September 30, 2023, and 2022, respectively)	$	1,043,360		$	628,295		$	2,239,354		$	1,760,880
Sale of real estate properties		-			652,788			-			839,661
Rental revenue		27,612			25,356			70,238			89,686
Total revenue		1,070,972			1,306,439			2,309,592			2,690,227

COST OF REVENUES:
Cost of service revenue (including $23,280 and $0 of cost of service revenue to related party for the three months ended September 30, 2023 and 2022, respectively, and $23,280 and $0 of cost of service revenue to related party for the nine months ended September 30, 2023 and 2022, respectively)		(219,865	)		(103,093	)		(374,048	)		(239,437	)
Cost of real estate properties sold		-			(445,746	)		-			(573,087	)
Cost of rental revenue		(9,629	)		(10,489	)		(28,315	)		(33,189	)
Total cost of revenues		(229,494	)		(559,328	)		(402,363	)		(845,713	)

GROSS PROFIT		841,478			747,111			1,907,229			1,844,514

OPERATING EXPENSES:
General and administrative (including $13,687 and $17,461 of general and administrative expense to related parties for the three months ended September 30, 2023, and 2022, respectively, and $90,407 and $53,689 of general and administrative expense to related parties for the nine months ended September 30, 2023 and 2022, respectively)		(978,023	)		(977,457	)		(2,686,846	)		(2,910,231	)

LOSS FROM OPERATIONS		(136,545	)		(230,346	)		(779,617	)		(1,065,717	)

OTHER INCOME (EXPENSES):
Other income (including $3,425 and $1,123 of other income from related parties for the three months ended September 30, 2023, and 2022, respectively, and $10,158 and $1,123 of other income from related parties for the nine months ended September 30, 2023, and 2022, respectively)		9,953			15,297			37,207			90,993
Interest income		8,853			7,865			30,859			11,441
Fair value gains of derivative liabilities associated with warrants		-			479			1			9,884
(Impairment) reversal of impairment of other investment (including reversal of impairment of $0 and impairment of $246,100 of related party investment for the three months ended September 30, 2023 and 2022, respectively, and reversal of impairment of $6,882,000 and impairment of $1,459,900 of related party investment for the nine months ended September 30, 2023 and 2022, respectively)		-			(246,100	)		6,882,000			(1,459,900	)
Reversal of write-off notes receivable		-			-			400,000			-
Interest expense		(318	)		-			(429	)		-
Total other income (expenses)		18,488			(222,459	)		7,349,638			(1,347,582	)

(LOSS) INCOME BEFORE INCOME TAX		(118,057	)		(452,805	)		6,570,021			(2,413,299	)
Income tax expense		(2,937	)		-			(6,563	)		(1,536	)
NET (LOSS) INCOME		(120,994	)		(452,805	)		6,563,458			(2,414,835	)
Net loss (income) attributable to non-controlling interest		3,865			(78,675	)		17,820			(96,107	)

NET (LOSS) INCOME ATTRIBUTED TO COMMON SHAREHOLDERS OF GREENPRO CAPITAL CORP.		(117,129	)		(531,480	)		6,581,278			(2,510,942	)
Other comprehensive loss:
- Foreign currency translation loss		(8,407	)		(143,440	)		(140,196	)		(295,309	)
COMPREHENSIVE (LOSS) INCOME	$	(125,536	)	$	(674,920	)	$	6,441,082		$	(2,806,251	)

NET (LOSS) INCOME PER SHARE, BASIC AND DILUTED (1)	$	(0.02	)	$	(0.07	)	$	0.85		$	(0.32	)

WEIGHTED AVERAGE NUMBER OF COMMON STOCK OUTSTANDING, BASIC AND DILUTED (1)		7,575,813			7,873,276			7,764,032			7,868,708

(1)	Weighted average shares outstanding and per share amounts have been adjusted for the periods shown to reflect the 10-for-1 reverse stock split effected on July 28, 2022 on a retroactive basis as described in Note 1.

See accompanying notes to the condensed consolidated financial statements.

GREENPRO CAPITAL CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022

(In U.S. dollars, except share data)

(Unaudited)

	Number of Shares		Amount		Additional Paid-in Capital		Accumulated Other Comprehensive Loss			Accumulated Deficit			Non- Controlling Interest			Total Stockholders’ Equity
	Three months ended September 30, 2023 (Unaudited)
	Common Stock
	Number of Shares		Amount		Additional Paid-in Capital		Accumulated Other Comprehensive Loss			Accumulated Deficit			Non- Controlling Interest			Total Stockholders’ Equity
Balance as of June 30, 2023 (Unaudited)		7,575,813	$	7,576	$	42,897,029	$	(356,680	)	$	(30,924,273	)	$	301,229		$	11,924,881
Foreign currency translation		-		-		-		(8,407	)		-			-			(8,407	)
Net loss		-		-		-		-			(117,129	)		(3,865	)		(120,994	)
Balance as of September 30, 2023 (Unaudited)		7,575,813	$	7,576	$	42,897,029	$	(365,087	)	$	(31,041,402	)	$	297,364		$	11,795,480

Nine months ended September 30, 2023 (Unaudited)
	Common Stock									Accumulated
	Number of Shares			Amount			Additional Paid-in Capital			Other Comprehensive Loss			Accumulated Deficit			Non- Controlling Interest			Total Stockholders’ Equity
Balance as of December 31, 2022		7,875,813		$	7,876		$	50,102,729		$	(224,891	)	$	(37,622,680	)	$	315,184		$	12,578,218
Cancellation of shares resulting from termination of investment		(300,000	)		(300	)		(7,205,700	)		-			-			-			(7,206,000	)
Foreign currency translation		-			-			-			(140,196	)		-			-			(140,196	)
Net income (loss)		-			-			-			-			6,581,278			(17,820	)		6,563,458
Balance as of September 30, 2023 (Unaudited)		7,575,813		$	7,576		$	42,897,029		$	(365,087	)	$	(31,041,402	)	$	297,364		$	11,795,480

Three months ended September 30, 2022 (Unaudited)
	Common Stock (1)							Accumulated
	Number of shares		Amount		Additional Paid-in Capital			Other Comprehensive Loss			Accumulated Deficit			Non- Controlling Interest		Total Stockholders’ Equity
Balance as of June 30, 2022 (Unaudited)		7,867,169	$	7,867	$	50,102,738		$	(178,732	)	$	(33,251,270	)	$	243,932	$	16,924,535
Roundup of fractional shares upon reverse stock split		8,644		9		(9	)		-			-			-		-
Foreign currency translation		-		-		-			(143,440	)		-			-		(143,440	)
Net (loss) income		-		-		-			-			(531,480	)		78,675		(452,805	)
Balance as of September 30, 2022 (Unaudited)		7,875,813	$	7,876	$	50,102,729		$	(322,172	)	$	(33,782,750	)	$	322,607	$	16,328,290

Nine months ended September 30, 2022 (Unaudited)
	Common Stock (1)							Accumulated
	Number of shares		Amount		Additional Paid-in Capital			Other Comprehensive Loss			Accumulated Deficit			Non- Controlling Interest		Total Stockholders’ Equity
Balance as of December 31, 2021		7,867,169	$	7,867	$	50,102,738		$	(26,863	)	$	(31,271,808	)	$	226,500	$	19,038,434
Roundup of fractional shares upon reverse stock split		8,644		9		(9	)		-			-			-		-
Foreign currency translation		-		-		-			(295,309	)		-			-		(295,309	)
Net (loss) income		-		-		-			-			(2,510,942	)		96,107		(2,414,835	)
Balance as of September 30, 2022 (Unaudited)		7,875,813	$	7,876	$	50,102,729		$	(322,172	)	$	(33,782,750	)	$	322,607	$	16,328,290

(1)	Share activity (number of shares or both number and amount of shares) has been adjusted for the periods shown to reflect the 10-for-1 reverse stock split effected on July 28, 2022 on a retroactive basis as described in Note 1.

See accompanying notes to the condensed consolidated financial statements.

GREENPRO CAPITAL CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022

(In U.S. dollars)

(Unaudited)

	2023			2022
	Nine months ended September 30,
	2023			2022

Cash flows from operating activities:
Net income (loss)	$	6,563,458		$	(2,414,835	)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization		107,827			119,084
Amortization of right-of-use assets		66,617			62,110
Amortization of finance lease right-of-use asset		1,950			-
Reversal of write-off notes receivable		(400,000	)		-
(Reversal of impairment) impairment of other investment-related party		(6,882,000	)		1,459,900
Loss on forfeiture of other investment		-			1,650
Provision for bad debts		-			784
Gain on sale of real estate held for sale		-			(266,574	)
Fair value gains of derivative liabilities associated with warrants		(1	)		(9,884	)
Changes in operating assets and liabilities:
Accounts receivable, net		(236,494	)		(39,411	)
Prepaids and other current assets		92,462			(625,718	)
Deferred cost of revenue		85,126			(82,424	)
Accounts payable and accrued liabilities		(133,386	)		(429,321	)
Operating lease liabilities		(67,832	)		(66,597	)
Income tax payable		2,032			(2,342	)
Deferred revenue		(493,333	)		136,198
Net cash used in operating activities		(1,293,574	)		(2,157,380	)

Cash flows from investing activities:
Purchase of property and equipment		(4,993	)		(2,244	)
Proceeds from disposal of other investment		500			-
Purchase of other investments		(500	)		(1,250	)
Initial payment of finance lease right-of-use asset		(9,717	)		-
Proceeds from real estate held for sale		-			839,661
Net cash (used in) provided by investing activities		(14,710	)		836,167

Cash flows from financing activities:
Principal payment of finance lease liabilities		(1,086	)		-
Advances to related parties		(465,677	)		(416,382	)
Collection of notes receivable		400,000			-
Net cash used in financing activities		(66,763	)		(416,382	)

Effect of exchange rate changes in cash and cash equivalents		22,797			45,190
NET CHANGE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH		(1,352,250	)		(1,692,405	)
CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, BEGINNING OF PERIOD		3,911,535			5,338,571

CASH, CASH EQUIVALENTS, AND RESTRICTED CASH, END OF PERIOD	$	2,559,285		$	3,646,166

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for income tax	$	4,423		$	3,495
Cash paid for interest	$	429		$	-

SUPPLEMENTAL NON-CASH INVESTING AND FINANCING ACTIVITIES:
Balance payment of finance lease right-of-use asset by finance lease liabilities	$	18,530		$	-

See accompanying notes to the condensed consolidated financial statements.

GREENPRO CAPITAL CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022

(In U.S. dollars, except share and per share data)

(Unaudited)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Greenpro Capital Corp. (the “Company” or “GRNQ”) was incorporated on July 19, 2013 in the state of Nevada. The Company currently provides a wide range of business consulting and corporate advisory services, including cross-border listing advisory services, tax planning, advisory and transaction services, record management services, and accounting outsourcing services. Our focus is on companies located in Asia and Southeast Asia, including Hong Kong, Malaysia, China, Thailand, and Singapore. As part of our business consulting and corporate advisory business segment, Greenpro Venture Capital Limited provides a business incubator for start-up companies and focuses on investments in select start-up and high growth potential companies. In addition to our business consulting and corporate advisory business segment, we operate another business segment that focuses on the acquisition and rental of real estate properties held for investment and the acquisition and sale of real estate properties held for sale.

Basis of presentation and principles of consolidation

The accompanying unaudited condensed consolidated financial statements as of and for the nine months ended September 30, 2023 and 2022 have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) that permit reduced disclosure for interim periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) have been condensed or omitted. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the period ended September 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. The Condensed Consolidated Balance Sheet information as of December 31, 2022 was derived from the Company’s audited Consolidated Financial Statements as of and for the year ended December 31, 2022 included in the Company’s Annual Report on Form 10-K filed with the SEC on March 31, 2023. These financial statements should be read in conjunction with that report.

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries and majority-owned subsidiaries which the Company controls and entities for which the Company is the primary beneficiary. For those consolidated subsidiaries where the Company’s ownership is less than 100%, the outside shareholders’ interests are shown as noncontrolling interests in equity. Acquired businesses are included in the consolidated financial statements from the date on which control is transferred to the Company. Subsidiaries are deconsolidated from the date that control ceases. All inter-company accounts and transactions have been eliminated in consolidation.

Going concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. During the nine months ended September 30, 2023, the Company recorded net cash used in operations of $1,293,574, and as of September 30, 2023, the Company incurred accumulated deficit of $31,041,402. These factors raise substantial doubt about the Company’s ability to continue as a going concern within one year of the date that the financial statements are issued. In addition, the Company’s independent registered public accounting firm, in its report on the Company’s December 31, 2022 financial statements, has expressed substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

The Company’s ability to continue as a going concern is dependent upon profitable future operations, positive cash flows and additional financing. Despite the amount of funds that we have raised in the past, no assurance can be given that any future financing, if needed, will be available or, if available, that it will be on terms that are satisfactory to the Company. Even if the Company is able to obtain additional financing, if needed, it may contain undue restrictions on its operations, in the case of debt financing, or cause substantial dilution for its stockholders, in the case of equity financing.

SEC Form 10-Q filed by Greenpro Capital Corp.