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EX-31 - EXHIBIT 31.1 - UNI CORE HOLDINGS CORPf311certfor10qa.htm
EX-31 - EXHIBIT 31.2 - UNI CORE HOLDINGS CORPf312certfor10qa.htm
EX-32 - EXHIBIT 32.2 - UNI CORE HOLDINGS CORPf322certfor10qa.htm
EX-32 - EXHIBIT 32.1 - UNI CORE HOLDINGS CORPf321certfor10qa.htm


 


UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________

FORM 10-Q/A


 (Mark One)


[X]

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


For the quarterly period ended:  December 31, 2012


[   ]

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


For the transition period from _________________ to ________________


Commission file number:  000-30430

Uni Core Holdings Corporation

(Exact name of registrant as specified in its charter)

Formerly known as “Intermost Corporation”


Wyoming

87-0418721

(State or other jurisdiction of

(IRS Employer Identification Number)

Incorporation or Organization)

 

 

 

Room 1207, Bank of America Tower, 12 Harcourt Road, Central, Hong Kong


000000

(Address of principal executive offices)

(Zip Code)


852-2827-6898

(Registrant’s Telephone Number, including area code)


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 ý  No o


Check whether the issuer is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer 

o

Accelerated Filer

o

Non-accelerated filer

o

Smaller reporting company

ý


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


Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 6,505,607,614 shares of common stock as of January 31, 2013.








TABLE OF CONTENTS




PART I.  Financial Information


Item 2.

Management’s Discussion and Analysis or Plan of Operation

2


PART II.  Other Information


Item 6.

Exhibits

12

Signatures

12

 


EXPLANATORY NOTE


This Amendment No. 1 on Form 10-Q/A amends the Quarterly Report on Form 10-Q of Uni Core Holdings Corporation (the “Company”) for the quarterly period ended December 31, 2012 as originally filed with the Securities and Exchange Commission (the “SEC”) on February 7, 2013 (the “Original Filing”). This Form 10-Q/A amends the Original Filing to include discussion of the Company’s current status and clarify that it is not a shell company. This Amendment No. 1 amends and restates the following section:

 

 

 

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


In addition, the Company’s principal executive officer and principal financial officer have provided new certifications in connection with this Amendment No. 1 (Exhibits 31.1, 31.2, 32.1 and 32.2).


Except as described above, no other amendments have been made to the Original Filing. This Amendment continues to speak as of the date of the Original Filing, and the Company has not updated the disclosure contained herein to reflect events that have occurred since the date of the Original Filing. Accordingly, this Amendment should be read in conjunction with the Company’s other filings made with the SEC subsequent to the filing of the Original Filing, including any amendments to those filings.



- 1 -




PART I

FINANCIAL INFORMATION


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.


Certain statements contained in this Form 10-Q/A constitute 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.  Such forward-looking statements herein are based on current expectations that involve a number of known and unknown risks and uncertainties. Such forward-looking statements are based on management’s assumptions that there will be no material adverse change in our operations or business, that we will meet success in marketing and selling our products, and that we will be able to continue to attract and retain skilled employees necessary for our business, among other things.  The foregoing assumptions are based on judgments of management with respect to, among other things, information available to our, future economic, competitive and market conditions and future business decisions.  All of these assumptions are difficult or impossible to predict accurately and many are beyond our control. Accordingly, although we believe that the assumptions underlying the forward-looking statements are reasonable, any such assumption could prove to be inaccurate and therefore there can be no assurance that the results contemplated in the forward-looking statements will be realized. There are a number of risks presented by our business and operations, which could cause our financial performance to vary markedly from prior results, or results contemplated by the forward-looking statements. Such risks include failure of the our technology or products to work as anticipated, failure to develop commercially viable products or services from our technology, delays or failure in financing efforts, delays in or lack of market acceptance, failure to recruit adequate personnel, and problems with protection of intellectual property, among others. The words “believe,” “estimate,” “expect,” “intend,” “anticipate” “should”, “could”, “may”, “plan” and similar expressions and variations thereof identify some of these forward-looking statements. Management decisions, including budgeting, are subjective in many respects and periodic revisions must be made to reflect actual conditions and business developments, the impact of which may cause us to alter our capital investment and other expenditures, which may also adversely affect our results of operations. In light of significant uncertainties inherent in forward-looking information included in this Quarterly Report on Form 10-Q/A, the inclusion of such information should not be regarded as a representation by us that our objectives or plans will be achieved. We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements.


Overview


We believe that the People’s Republic of China represents an exciting emerging world market whose role in the global economy is, despite recent global economic slowdown, increasing steadily.  China’s economic growth rate, measured by its gross domestic product, has consistently been higher than 7% over the past 10 years.  This economic growth is attributable to many factors, including investment in the country’s infrastructure, increased privatization of businesses and an abundant source of labor.  Currently, we offer products and services to businesses and consumers located primarily in China.  The Company’s subsidiary, APT Paper Group Limited, is divided into three independently operated facilities.  One of the Company’s paper factories located in Shenzhen recently filed for bankruptcy protection and was closed.  The other two independently operating subsidiary paper factories continue to operate normally.  Our plan is to take advantage of China’s economic growth to expand our existing businesses and, possibly, in the future, to sell our products and services outside of China.  We also have begun to acquire diverse businesses that are not dependent on, or directly related to, each other.  We believe that diversification is a good hedge against the collapse of a single industry, such as the global collapse of the technology industry that occurred in 2000.  We expect that any acquisitions we make will improve our financial condition, although we cannot guarantee any such result.


Amidst global economic slowdown we continue to diversify our business, not only so that we will no longer be dependent on one market for revenue, but also so that we will be poised to take advantage of future economic recovery.  Generally, the issuance of our common stock represents some or all of the purchase price we pay for an acquired business.  We believe that the continued active trading of our common stock will be important to the principals of target companies and future acquisitions may be dependent on the active trading of our common stock.  However, our common stock has not been actively traded and, if our common stock continues to trade with limited volume and at current levels we may not be able to make acquisitions as planned.



- 2 -




Risks Associated with Doing Business in China


There are significant risks in operating in the Peoples’ Republic of China (the “PRC”). These include risks associated with the political and economic environment, foreign currency exchange and the legal system in the PRC.  The economy of PRC differs significantly from the economies of the industrialized nations of the West in such respects as structure, level of development, gross national product, growth rate, capital reinvestment, resource allocation, self-sufficiency, rate of inflation and balance of payments position, among others. Only recently has the PRC government encouraged substantial private economic activities. The Chinese economy has experienced significant growth in the past several years, but such growth has been uneven among various sectors of the economy and geographic regions. Actions by the PRC government to control inflation have significantly restrained economic expansion in the recent past. Similar actions by the PRC government in the future could have a significant adverse effect on economic conditions there.


Many laws and regulations dealing with economic matters in general and foreign investment in particular have been enacted in the PRC.  However, the PRC still does not have a comprehensive system of laws, and enforcement of existing laws may be uncertain and sporadic.  Our primary sources of revenues and cash flows are derived from our business operations in the PRC.  The PRC economy has, for many years, been a centrally-planned economy, operating on the basis of annual, five-year and ten-year state plans adopted by central PRC governmental authorities, which set out national production and development targets. The PRC government has been pursuing economic reforms since it first adopted its "open-door" policy in 1978. There is no assurance that the PRC government will continue to pursue economic reforms or that there will not be any significant change in its economic or other policies, particularly in the event of any change in the political leadership of, or the political, economic or social conditions in, the PRC. There is also no assurance that the Company will not be adversely affected by any such change in governmental policies or any unfavorable change in the political, economic or social conditions, the laws or regulations, or the rate or method of taxation in the PRC.


As many of the economic reforms that have been or are being implemented by the PRC government are unprecedented or experimental, they may be subject to adjustment or refinement, which may have adverse effects on the Company. Further, through state plans and other economic and fiscal measures such as the leverage of exchange rate, it remains possible for the PRC government to exert significant influence on the PRC economy. The Company's financial instruments that are exposed to concentration of credit risk consist primarily of cash and cash equivalents. Cash and cash equivalents are maintained with government-owned banks in the PRC with high credit ratings.


On January 1, 1994, the PRC government introduced a single rate of exchange of Renminbi (“Rmb”) against United States Dollar ("US$") as quoted daily by the People's Bank of China (the “Unified Exchange Rate”). On July 21, 2005, Rmb was revalued from Rmb 8.28 to Rmb8.11 for US$1 following the removal of the peg to the US dollar and pressure for the United States. The Peoples Bank of China also announced that the Renminbi would be pegged to a basket of foreign currencies, rather than being strictly tied to the US dollar and would trade within a narrow 0.3% band against this basket of currencies, which is dominated by the US dollar, Euro, Japanese Yen and South Korean Won, with a smaller proportion made up of the British pound, Thai Baht and Russian Ruble. No representation is made that the Rmb amounts have been, or could be, converted into US$ at that rate. This quotation of exchange rates does not imply free convertibility of Rmb to other foreign currencies. All foreign exchange transactions continue to take place either through the Bank of China or other banks authorized to buy and sell foreign currencies at the exchange rate quoted by the People's Bank of China. Approval of foreign currency payments by the People's Bank of China or other institutions requires submitting a payment application form together with suppliers’ invoices, shipping documents and signed contracts.


Restriction on the Payment of Dividends - PRC law requires net profits after taxes to be used to set-off any losses carried forward before any distribution of profits may be made. Furthermore, PRC law imposes a Mandatory Provident Reserve on all businesses. Under this law, a business must set aside 10% of its distributable profits as a mandatory reserve before a distribution of profits may occur. Once the business accumulates a mandatory reserve equal to 50% of its capitalization, no further accumulation of the reserve is required.


Certain Factors Affecting Future Operating Results


The Company’s operating results have been, and will continue to be, affected by a wide variety of factors that could have a material adverse effect on revenues and profitability during any particular period. Some of these factors include:



- 3 -




·

the Company's ability to successfully implement its current business plans;


·

whether the Company will be able to obtain additional capital, if necessary, to support its operations;


·

whether the Company will be able to find joint venture prospects or acquisition prospects with which to enhance its business;


·

whether the Company can successfully integrate acquisitions that it makes into its business;


·

the level and rate of acceptance of the Company's products and services by consumers in China;


·

continued economic growth in China;


·

entry of new competition (including established companies from outside China and companies with substantially greater resources) into the Company's market;


·

fluctuations in the level of demand for services or products;


·

rescheduling or cancellation of orders by customers;


·

competitive pressures on selling prices;


·

rapid changes in technology, which could result in the Company's technology becoming obsolete;


·

dependence upon key employees;


·

availability and cost of computer technicians;


·

loss of any of the Company's major customers;


·

the Company's ability to introduce new products and services on a timely basis;


·

new product and service introductions by the Company's competitors;


·

fluctuations in exchange rates; and


·

adverse changes in the general economic, social or political conditions in the PRC.


Critical Accounting Policies


Management’s discussion and analysis of results of operations and financial condition are based upon the Company’s consolidated financial statements.  These statements have been prepared in accordance with the generally accepted accounting principles as used in the United States of America.  These principles require management to make certain estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities.  On an on-going basis, we evaluate our estimates based on historical experience and various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.


The following critical accounting policies affect the more significant judgments and estimates used in the preparation of the Company's consolidated financial statements.



- 4 -



Revenue Recognition


Revenues are recognized (i) with respect to services, at the time a project (or a milestone thereof) is completed and accepted by the customer, and (ii) with respect to products, at the time products are delivered to customers and collectability for such sales is reasonably assured. We have adopted Staff Accounting Bulletin No.101, Revenue Recognition (“SAB 101”) in our financial statements. SAB 101 provides in part further interpretive guidance for public companies on the recognition, presentation, and disclosure of revenues in financial statements. The adoption of SAB 101 did not have a material impact on our revenue recognition practices.


Inventories


Inventories consist of finished goods and raw materials, and stated at the lower of cost or market value. Substantially all inventory costs are determined using the weighted average basis. Finished goods are comprised of direct materials, direct labor and an appropriate proportion of overhead. The management regularly evaluates the composition of its inventory to identify slow-moving and obsolete inventories to determine if additional write-downs are required.


Accounts Receivable


We typically extend credit to our customers.  From time to time, e-commerce solution services are provided under fixed-price contracts where the revenues and the payment of related receivable balances are due upon the achievement of certain milestones. Management estimates the probability of collection of the receivable balances and provides an allowance for doubtful accounts based upon its judgment in assessing the realization of these receivable balances taking into account aging, historical experience, the customer’s financial condition and general economic conditions.


Goodwill


Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in a business combination. In accordance with Accounting Standards Codification ASC 350 “Intangibles - Goodwill and Other” formerly Statement of Financial Accounting Standards ("SFAS") No. 142, "Goodwill and Other Intangible Assets", goodwill is no longer subject to amortization. Rather, goodwill is subject to at least an annual assessment for impairment, applying a fair-value based test. Fair value is generally determined using a discounted cash flow analysis. See Note 4 for goodwill impairment details.


Accounting for the Impairment of Long-Lived Assets and Goodwill


The Company periodically evaluates the carrying value of long-lived assets held or used whenever events and circumstances indicate that the carrying value of the asset may no longer be recoverable.  An impairment loss, measured on the fair value of the asset, is recognized if expected future undiscounted cash flows are less than the carrying value of the assets.


We evaluate goodwill, at a minimum, on an annual basis and whenever events and changes in circumstances suggest that the carrying amount may not be recoverable, in accordance with ASC 350 “Intangibles – Goodwill and Other,” formerly SFAS No. 142 “Goodwill and Other Intangible Assets.”  Impairment of goodwill is tested at the reporting unit level by comparing the reporting unit’s carrying amount, including goodwill, to the fair value of the reporting unit.  The fair values of the reporting units are estimated using discounted cash flows approach.  If the carrying amount of the reporting unit exceeds its fair value, goodwill is considered impaired and a second step is performed to measure the amount of impairment loss, if any.


Income Taxes


The Company uses the accrual method of accounting to determine and report its taxable income and tax credit in the year in which they are available.  The Company has implemented ASC 740 “Income Taxes” formerly SFAS No. 109, Accounting for Income Taxes.


- 5 -




Income tax liabilities computed according to the United States, People’s Republic of China (PRC), Taiwan (ROC) and Hong Kong SAR tax laws are provided for the tax effects of transactions reported in the financial statements and consists of taxes currently due plus deferred taxes related primarily to differences between the basis of fixed assets and intangible assets for financial and tax reporting.  The deferred tax assets and liabilities represent the future tax return consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled.  Deferred taxes also are recognized for operating losses that are available to offset future income taxes.  A valuation allowance is created to evaluate deferred tax assets if it is more likely than not that these items will either expire before the Company is able to realize that tax benefit, or that future realization is uncertain.





Results of Operations - Three Months Ended December 31, 2012 and 2011


All amounts shown below are presented in US$. As used below, the letter “K” appearing immediately after a dollar amount denotes that it has been rounded to the nearest US$1,000.


Net Revenues


Net revenues for the three months ended December 31, 2012 were derived principally from sales of paper products of APT Paper Group Limited. The term "e-commerce solutions" includes web-site design and development and web-hosting.


The following table reflects the total net revenues and percentage of net revenues by major category for the periods indicated:

 

3 months ended December 31

 

2012

2012

2011

2011

 

USD'000

%

USD'000

%

Sales of paper products

1,866

100%

6,334

100%

E-commerce solutions

 

 

 

 

- website design and development

0

0%

0

0%

Consulting

0

0%

4

0%

 

1,866

100%

6,337

100%

 

 

 

 

 

 

Total net revenues decreased to $1,866K during the three months ended December 31, 2012, as compared to $6,337K during the three months ended December 31, 2011. The decrease in total net revenues was primarily due to the reduction of revenue and closing down of one of the Company’s subsidiary independently operated APT Paper Group Limited paper factories located in Shenzhen.  The remaining two independently operated APT Paper Group Limited paper factories located in Suzhou and Qingdao continue to operate normally.



- 6 -



Cost of Revenues


The following table reflects the principal components of cost of revenues and the percentage of net revenues represented by each component for the periods indicated:

 

3 months ended December 31

 

2012

2012

2011

2011

 

USD'000

%

USD'000

%

Engineering/technician salaries

6

0%

23

0%

Direct materials

1,689

91%

4,685

74%

Direct labor

135

7%

300

5%

Manufacturing overhead

180

10%

520

8%

Depreciation

60

3%

99

2%

Others

2

0%

128

2%

 

2,072

111%

5,755

91%

                                           

 

The decrease in costs of revenues for the three months ended December 31, 2012 compared with 2011 was due to the decrease of sales of APT Paper Group Limited and the closing down of Shenzhen factories. Costs of revenues consist principally of the production cost of paper products for the periods ended December 31, 2012 and 2011. The costs of revenues for the period consist principally of direct material cost, direct labor, manufacturing overhead, depreciation, and other costs including travel, employee benefits, and office expenses.


Selling, General and Administrative Expense


Selling, general and administrative (“SG&A”) expense consists principally of sales commissions, advertising, other marketing expenses, rental expenses, salaries for administrative and sales staff, and corporate overhead.


The following table reflects the principal components of SG&A expense and the percentage of net sales represented by each component for the periods indicated:


 

3 months ended December 31

 

2012

2012

2011

2011

 

USD'000

%

USD'000

%

Sales & Marketing salaries & commissions

0

0%

240

4%

Other sales and marketing exp

0

0%

275

4%

Rentals

281

15%

271

4%

Administrative salaries

153

8%

275

4%

Consultancy Fee

60

3%

11

0%

Corporate overhead

66

4%

221

4%

 

560

30%

1,293

20%


The principal components of SG&A during the three months ended December 31, 2012 were rental fees, administrative salaries and benefits, consultancy fees, and other corporate expenses, which includes legal and professional fees, general office expenses, traveling expenses, general employee benefit expense, depreciation consultancy fees, and allowance for bad and doubtful accounts.


For the three months ended December 31, 2012, SG&A expenses decreased to $560K, as compared to $1,293K for the three months ended December 31, 2011.  The decrease in SG&A was mainly due to the decrease of corporate overhead and the reduction of costs associated with the closed Shenzhen factories.



- 7 -



Income Taxes


There was no income tax for both the three months ended December 31, 2012 and the three months ended December 31, 2011.


Minority Interest


Minority interest reflects the minority shareholders' proportionate interest in the net loss of the group operating losses of China Equity Platform Holding Group Limited.   Because the China Equity Platform Holding Group Ltd. was sold in February 2012, we do not have any minority interest to report at this time.  This item remains in Our balance sheet so as to comply with Regulation S-K Item 905 “Comparative Information”.


Net Income (Loss)


The Company had net loss of $5,509K during the three months ended December 31, 2012, as compared to a net loss of $737K during the three months ended December 31, 2011.   It included a material impairment loss on closing down of Shenzhen factories $4,578K.










Results of Operations - Six Months Ended December 31, 2012 and 2011


All amounts shown below are presented in US$. As used below, the letter “K” appearing immediately after a dollar amount denotes that it has been rounded to the nearest US$1,000.


Net Revenues


Net revenues for the six months ended December 31, 2012 were derived principally from sales of paper products of APT Paper Group Limited. The term "e-commerce solutions" includes web-site design and development and web-hosting.


The following table reflects the total net revenues and percentage of net revenues by major category for the periods indicated:

 

6 months ended December 31

 

2012

2012

2011

2011

 

USD'000

%

USD'000

%

Sales of paper products

6,772

100%

12,601

100%

E-commerce solutions

 

 

 

 

- website design and development

0

0%

0

0%

Consulting

0

0%

47

0%

 

6,772

100%

12,648

100%

 

 

 

 

 

 

Total net revenues decreased to $6,772K during the six months ended December 31, 2012, as compared to $12,648K during the six months ended December 31, 2011.  The decrease in total net revenues was primarily due to the reduction in sales of paper products caused by the bankruptcy and closing of the independently operated Shenzhen factories.  The remaining two independently operated APT Paper Group Limited factories located in Suzhou and Qingdao continue to operate normally.



- 8 -




Cost of Revenues


The following table reflects the principal components of cost of revenues and the percentage of net revenues represented by each component for the periods indicated:

 

6 months ended December 31

 

2012

2012

2011

2011

 

USD'000

%

USD'000

%

Engineering/technician salaries

24

0%

45

0%

Direct materials

5,341

79%

9,590

77%

Direct labor

423

6%

620

5%

Manufacturing overhead

590

9%

1,065

8%

Depreciation

197

3%

249

2%

Others

4

0%

130

1%

 

6,579

97%

11,699

93%

                                           

 

The decrease in costs of revenues for the six months ended December 31, 2012 compared with 2011 was due to the decrease of sales of APT Paper Group Limited and the closing down of Shenzhen factories.  Costs of revenues consist principally of the production cost of paper products for the periods ended December 31, 2012 and 2011.  The costs of revenues for the period consist principally of direct material cost, direct labor, manufacturing overhead, depreciation, and other costs including travel, employee benefits, and office expenses.



Selling, General and Administrative Expense


Selling, general and administrative (“SG&A”) expense consists principally of sales commissions, advertising, other marketing expenses, rental expenses, salaries for administrative and sales staff, and corporate overhead.


The following table reflects the principal components of SG&A expense and the percentage of net sales represented by each component for the periods indicated:


 

6 months ended December 31

 

2012

2012

2011

2011

 

USD'000

%

USD'000

%

Sales & Marketing salaries & commissions

99

2%

427

3%

Other sales and marketing exp

94

1%

568

5%

Rentals

562

8%

542

4%

Administrative salaries

400

6%

591

5%

Consultancy Fee

82

1%

61

0%

Corporate overhead

412

6%

631

5%

 

1,649

24%

2,820

22%


The principal components of SG&A during the six months ended December 31, 2012 were sales and marketing salaries and commissions, other marketing expenditures, administrative salaries and benefits, and other corporate expenses, which includes legal and professional fees, general office expenses, traveling expenses, general employee benefit expense, depreciation consultancy fees, and allowance for bad and doubtful accounts.



- 9 -




For the six months ended December 31, 2012, SG&A expense decreased by 42% to $1,649K, as compared to $2,820K for the six months ended December 31, 2011.  The decrease in SG&A was mainly due to the decrease of corporate overhead and the reduction of costs associated with the closed Shenzhen factories.  The remaining two independently operated APT Paper Group Limited factories located in Suzhou and Qingdao continue to operate normally.


Income Taxes


There was no income tax for both the six months ended December 31, 2012 and the six months ended December 31, 2011.


Minority Interest


Minority interest reflects the minority shareholders' proportionate interest in the net loss of the group operating losses of China Equity Platform Holding Group Limited.   Because the China Equity Platform Holding Group Ltd. was sold in March 2012, we do not have any minority interest to report at this time.  This item remains in Our balance sheet so as to comply with Regulation S-K Item 905 “Comparative Information”.


Net Income (Loss)


The Company had net loss of $6,525K during the six months ended December 31, 2012, as compared to a net loss of $1,917K during the six months ended December 31, 2011. It included a material impairment loss on closing down of Shenzhen factories $4,578K.

.




Liquidity and Capital Resources – December 31, 2012


At December 31, 2012, the Company had cash and cash equivalents of $188K and net current liabilities of $6,181K, as compared to $1,219K of cash and cash equivalents and $4,619K of net current liabilities capital at December 31, 2011. The accounts receivable was decreased by $5,035K to $2,272K in 2012 as compared to $7,307K in 2011. The main reason of such decrease was due to the decrease in sales and closing down the Shenzhen factories.   The remaining two independently operated APT Paper Group Limited factories located in Suzhou and Qingdao continue to operate normally.  The deposits, prepayments and other receivables were decreased $2,085K to $534K in 2012 as compared to $2,619K in 2011. The decrease was mainly from the closing down of Shenzhen factories and decrease of trade deposits paid to suppliers. The accounts payable was decreased by $4,812K to $1,460K in 2012 as compared to $6,272K in 2011. The decrease was mainly from the decrease of turnover resulting in a decrease in the amount of materials purchased and the closing down of the Shenzhen factories. The accrued liabilities and other payable were also decreased by $611K to $2,916K in 2012 as compared to $3,527K in 2011. The decrease was due to the decrease of trade deposits from customers. In the quarter ended December 31, 2012, the Company had raised convertible loan stocks of $369K which will mature in six months. The loan from a shareholder and the bank loans were also decreased in 2012 as compared to 2011.  These loaned funds were used for the payment of daily operating expenses.  


Net cash used in operating activities was $1,073K for the six months ended December 31, 2012, as compared to net cash used in operating activities of $1,897K for the six months ended December 31, 2011.  While one of the independently operating paper factories in Shenzhen has closed, the remaining two independently operated APT Paper Group Limited factories located in Suzhou and Qingdao continue to operate normally.


Net cash used in investing activities was $0.4K and $79K for the six months ended December 31, 2012 and December 31, 2011 respectively, mainly consisting of a decrease in expenses for fixed assets.

 

Net cash used in financing activities was $1,471K for six months ended December 31, 2012, was mainly the bank loans and the convertible loan stock. Net cash generated from financing activities was $1,473K for the six months ended December 31, 2011.

 

The Company continues to evaluate various opportunities to improve the operating performance of the Company’s businesses and to invest in or acquire other types of businesses.  The remaining two independently operated APT Paper Group Limited factories located in Suzhou and Qingdao continue to operate normally.



- 10 -



Principal Commitments


At December 31, 2012, the Company has operating lease agreements for office premises, which are expiring in June 2035. The Company does not have any material commitments for capital expenditures, or have any transactions, obligations or relationships that could be considered off-balance sheet arrangements.


The Company has no long-term debt at December 31, 2012.



Subsequent Event


The investment cooperation agreement with the shareholders of Shaanxi Prosperous Agriculture Company Limited to acquire 51% equity of Shaanxi Prosperous Agriculture Company Limited has not yet finished.


From July to December, 2012, an investor exercised and converted a total of $221,701 out of $578,180 convertible loan balance for 2,628,238,857 shares of ordinary common stock.


The Company has evaluated all other subsequent events through January 31, 2013 the date these consolidated financial statements were issued, and determined that there were no other subsequent events or transactions that require recognition or disclosures in the financial statements except the above- mentioned matters.



- 11 -




PART II

OTHER INFORMATION


Item 6.  Exhibits


Exhibit

 

Number

Description of Exhibit

 

 

31.1

Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) and 15d-14(a)

31.2

Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) and 15d-14(a)

32.1

Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2

Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002











SIGNATURES


Pursuant to requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


Date:  3rd May, 2013

UNI CORE HOLDINGS CORPORATION

          




By:

___/s/ Chia Hsun Wu_____________________

Chia Hsun Wu

Chief Executive Officer

                                  

     




By:

__/s/ Thomas Lee________________________

Thomas Lee

Chief Financial Officer




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