UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended March 31, 2024

☐	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: 001-41494

YOSHIHARU GLOBAL CO.

(Exact name of Registrant as specified in its charter)

Delaware

5812

87-3941448

(State or other jurisdiction of

incorporation or organization)

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer

Identification Number)

6940 Beach Blvd., Suite D-705

Buena Park, CA 90621

(714) 694-2403

(Address, including zip code, and telephone number, including

area code, of Registrant’s principal executive offices)

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:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Class A Common Stock, $0.0001 par value per share

YOSH

The Nasdaq Stock Market LLC

(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 every Interactive Data File required to be submitted 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 such files). ☒ Yes ☐ No

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

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

The registrant has 1,242,722 shares of class A common stock outstanding, and 100,000 shares of class B common stock outstanding as of March 31, 2024.

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION		1

Item 1	Unaudited Consolidated Financial Statements	1

	Consolidated Balance Sheets as of March 31, 2024 and December 31, 2023	1

	Consolidated Statements of Operations for the Three Months Ended March 31, 2024 and 2023	2

	Consolidated Statements of Stockholders’ Equity for the Three Months Ended March 31, 2024 and 2023	3

	Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2024 and 2023	4

	Notes to Consolidated Financial Statements	5

Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

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 6	Exhibits	32

Signature		33

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are based on our management’s beliefs and assumptions and on information currently available to management, and which statements involve substantial risk and uncertainties. All statements contained in this Quarterly Report on Form 10-Q other than statements of historical fact, including statements regarding our future operating results and financial position, our business strategy and plans, market growth and trends, and objectives for future operations such as our ability to achieve in excess of 100% annual unit growth rate over the next three to five years, our hope to generate future comparable restaurant sales growth, our plan to drive high profitability, and our intention to heighten brand awareness are forward-looking statements. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions.

These risks and uncertainties include, among other things, the risk that we may not be able to successfully implement our growth strategy if we are unable to identify appropriate sites for restaurant locations, expand in existing and new markets, obtain favorable lease terms, attract guests to our restaurants or hire and retain personnel; the risk that we may not be able to maintain or improve our comparable restaurant sales growth; that the restaurant industry is a highly competitive industry with many competitors; that our limited number of restaurants, the significant expense associated with opening new restaurants, and the unit volumes of our new restaurants makes us susceptible to significant fluctuations in our results of operations; that we have incurred operating losses and may not be profitable in the future; the risk that our plans to maintain and increase liquidity may not be successful; that we depend on our senior management team and other key employees, and the loss of one or more key personnel or an inability to attract, hire, integrate and retain highly skilled personnel could have an adverse effect on our business, financial condition or results of operations; that our operating results and growth strategies will be closely tied to the success of our future franchise partners and we will have limited control with respect to their operations; the risk that we may face negative publicity or damage to our reputation, which could arise from concerns regarding food safety and foodborne illness or other matters; that minimum wage increases and mandated employee benefits could cause a significant increase in our labor costs; that events or circumstances could cause the termination or limitation of our rights to certain intellectual property critical to our business that is licensed from Yoshiharu Holdings Co., or that we could face infringements on our intellectual property rights and be unable to protect our brand name, trademarks and other intellectual property rights; that challenging economic conditions may affect our business by adversely impacting numerous items that include, but are not limited to: consumer confidence and discretionary spending, the future cost and availability of credit and the operations of our third-party vendors and other service providers; the risk that we, or our point of sale and restaurant management platform partners, may fail to secure guests’ confidential, personally identifiable, debit card or credit card information or other private data relating to our employees or us; and the impact of the COVID-19 pandemic, or a similar public health threat, on global capital and financial markets, general economic conditions in the United States, and our business and operations.

You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations and projections about future events and trends that we believe may affect our business, financial condition, results of operations, and prospects. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties, and other factors described elsewhere in this Quarterly Report on Form 10-Q and in the section titled “Risk Factors” in the Company’s recently filed registration statement on Form S-1 (File No. 333-262330). We undertake no obligation to update any forward-looking statements after the date of this Quarterly Report on Form 10-Q or to conform such statements to actual results or revised expectations, except as required by law.

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

Yoshiharu Global Co.

Unaudited Consolidated Balance Sheets

As of	March 31, 2024			December 31, 2023

ASSETS
Current Assets:
Cash	$	1,355,738		$	1,462,326
Accounts receivable		94,135			-
Inventories		77,151			73,023
Total current assets		1,527,024			1,535,349

Non-Current Assets:
Property and equipment, net		4,278,910			4,092,950
Operating lease right-of-use asset		5,322,909			5,459,708
Other assets		1,584,395			1,931,357
Total non-current assets		11,186,214			11,484,015

Total assets	$	12,713,238		$	13,019,364

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Accounts payable and accrued expenses	$	674,989		$	647,811
Line of credit		1,000,000			1,000,000
Current portion of operating lease liabilities		589,561			572,230
Current portion of bank notes payables		685,978			414,378
Current portion of loan payable, EIDL		7,931			10,536
Loans payable to financial institutions		365,470			534,239
Due to related party		81,097			24,176
Other payables		65,700			65,700

Total current liabilities		3,470,726			3,269,060
Operating lease liabilities, less current portion		5,534,934			5,689,535
Bank notes payables, less current portion		1,450,826			991,951
Loan payable, EIDL, less current portion		415,329			415,329
Total liabilities		10,871,815			10,365,885

Commitments and Contingencies		-			-

Stockholders’ equity
Class A Common Stock - $0.0001 par value; 49,000,000 authorized shares; 1,242,722 shares issued and outstanding at March 31, 2024 and 1,230,246 shares issued and outstanding at December 31, 2023		124			123
Class B Common Stock - $0.0001 par value; 1,000,000 authorized shares; 100,000 shares issued and outstanding at March 31, 2024 and December 31, 2023		10			10
Common Stock, value		10			10

Additional paid-in capital		12,058,267			11,994,119
Accumulated deficit		(10,216,978	)		(9,340,773	)
Total stockholders’ equity		1,841,423			2,653,479

Total liabilities and stockholders’ equity	$	12,713,238		$	13,019,364

See accompanying notes to unaudited consolidated financial statements.

Yoshiharu Global Co.

Unaudited Consolidated Statements of Operations

	2024			2023
	Three Months Ended March 31,
	2024			2023

Revenue:
Food and beverage	$	2,811,609		$	2,479,574
Total revenue		2,811,609			2,479,574

Restaurant operating expenses:
Food, beverages and supplies		667,892			651,446
Labor		1,286,534			1,138,067
Rent and utilities		318,568			298,463
Delivery and service fees		143,361			147,837
Depreciation		170,682			128,270
Total restaurant operating expenses		2,587,037			2,364,083

Net operating restaurant operating income (loss)		224,572			115,491

Operating expenses:
General and administrative		920,401			1,060,453
Related party compensation		42,154			112,048
Advertising and marketing		33,904			26,342
Total operating expenses		996,459			1,198,843

Loss from operations		(771,887	)		(1,083,352	)

Other income (expense):
Interest		(104,318	)		(61,137	)
Total other income (expense), net		(104,318	)		(61,137	)

Loss before income taxes		(876,205	)		(1,144,489	)

Income tax provision		-			-

Net income (loss)	$	(876,205	)	$	(1,144,489	)

Income (loss) per share:
Basic and diluted		(0.65	)		(1.01	)

Weighted average number of common shares outstanding:
Basic and diluted		1,341,488			1,136,274

See accompanying notes to unaudited consolidated financial statements.

Yoshiharu Global Co.

Unaudited Consolidated Statements of Stockholders’ Equity (Deficit)

	Shares		Amount		Shares		Amount		Capital		Deficit			Equity
	Class A Shares				Class B Shares				Additional Paid-In		Accumulated			Total Stockholders’
	Shares		Amount		Shares		Amount		Capital		Deficit			Equity
Balance at December 31, 2023		1,230,246	$	123		100,000	$	10	$	11,994,119	$	(9,340,773	)	$	2,653,479

Issuance of Class A Common Stock		12,476		1		-		-		64,148		-			64,149

Net loss		-		-		-		-		-		(876,205	)		(876,205	)

Balance at March 31, 2024 (unaudited)		1,242,722	$	124		100,000	$	10	$	12,058,267	$	(10,216,978	)	$	1,841,423

	Class A Shares				Class B Shares				Additional Paid-In		Accumulated			Total Stockholders’
	Shares		Amount		Shares		Amount		Capital		Deficit			Deficit
Balance at December 31, 2022		1,228.846	$	123		100,000	$	10	$	11,938,119	$	(6,300,409	)	$	5,637,843
Balance		1,228.846	$	123		100,000	$	10	$	11,938,119	$	(6,300,409	)	$	5,637,843

Net loss		-		-		-		-		-		(1,144,489	)		(1,144,489	)

Balance at March 31, 2023 (unaudited)		1,228,846	$	123		100,000	$	10	$	11,938,119	$	(7,445,871	)	$	4,493,354
Balance		1,228,846	$	123		100,000	$	10	$	11,938,119	$	(7,445,871	)	$	4,493,354

See accompanying notes to unaudited consolidated financial statements.

Yoshiharu Global Co.

Unaudited Consolidated Statements of Cash Flows

	2024			2023
	For the three months ended March 31,
	2024			2023

Cash flows from operating activities:
Net loss	$	(876,205	)	$	(1,144,489	)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		170,682			128,270
Changes in assets and liabilities:
Accounts receivable		(94,135	)		-
Inventories		(4,128	)		6,337
Other assets		346,962			(709,109	)
Accounts payable and accrued expenses		26,707			41,684
Due to related party		56,921			(155,753	)
Other payables		-			64,258
Net cash used in operating activities		(373,196	)		(1,768,802	)

Cash flows from investing activities:
Purchases of property and equipment		(356,642	)		(938,984	)
Net cash used in investing activities		(356,642	)		(938,984	)

Cash flows from financing activities:
Advance from line of credit		-			500,000
Proceeds from borrowings		812,000			-
Repayments on bank notes payables		(84,130	)		(87,215	)
Repayment of loan payable to financial institutions		(168,769	)		-
Proceeds from sale of common shares		64,149			-
Net cash provided by financing activities		623,250			412,785

Net decrease in cash		(106,588	)		(2,295,001	)

Cash – beginning of period		1,462,326			6,138,786

Cash – end of period	$	1,355,738		$	3,843,785

Supplemental disclosures of non-cash financing activities:

Supplemental disclosures of cash flow information
Cash paid during the periods for:
Interest	$	104,318		$	61,137
Income taxes	$	-		$	-

See accompanying notes to unaudited consolidated financial statements.

YOSHIHARU GLOBAL CO.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

1. NATURE OF OPERATIONS

Yoshiharu Global Co. (“Yoshiharu”) was incorporated in the State of Delaware on December 9, 2021. Yoshiharu has the following wholly owned subsidiaries:

SCHEDULE OF WHOLLY OWNED SUBSIDIARIES

Name	Date of Formation	Description of Business
Global JJ Group, Inc. (“JJ”)	January 8, 2015	Ramen stores located in Orange, California and Buena Park, California.
Global AA Group, Inc. (“AA”)	July 21, 2016	Ramen store located in Whittier, California.
Global BB Group, Inc. (“BB”)	May 19, 2017	Ramen store located in Chino Hills, California.
Global CC Group, Inc. (“CC”)	September 23, 2019	Ramen stores located in Eastvale, California and Corona, California.
Global DD Group, Inc. (“DD”)	December 1

SEC Form 10-Q filed by Yoshiharu Global Co.