Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes and other financial information included elsewhere in this offering. Some of the information contained in this discussion and analysis, including information regarding the strategy and plans for our business, includes forward-looking statements that involve risks and uncertainties. You should review the "Risk Factors" section for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview

We manufacture FDA-Registered Surgical and N95 Masks in our own custom-built 45,000 square foot factory--located just outside of Austin, TX.

In less than 5 months, we built an automated factory capable of producing millions of masks per day. In 5 years, we hope to be producing over 1,000 products--all that take advantage of huge macro trends happening today like Automation, Direct to Consumer, Environmentalism, low energy costs, USA Made, and a changing US Job Market that needs a manufacturing rebirth to survive.

Milestones

Armbrust Inc. was incorporated in the State of Delaware in October 2018.

Since then, we have:

• We are proven team with several previous exits, lead by a former Y Combinator founder who has raised over $10M and built multiple companies with revenues in the tens of millions annually. 
• We took less than five months to build the second-largest mask factory in the United States, making over $6M in revenue with $14M annual run rate.
• We received FDA-Registration and ASTM Level 2 certification to sell Surgical Masks faster than anyone has before, and we are 60 days away from N95 approval.
• In the three months since launching our website, we have processed more than 3.5M  direct to consumer orders, and have direct deals with the State of Texas, the States of Illinois, and large hospital systems like Kaiser Permanente.

Historical Results of Operations

Our company was organized in October 2018 and has limited operations upon which prospective investors may base an evaluation of its performance.

• Revenues & Gross Margin. For the period ended December 31, 2019, the Company had revenues of $0 compared to the year ended December 31, 2018, when the Company had revenues of $0.
• Assets. As of December 31, 2019, the Company had total assets of -$12, including -$12 in cash. As of December 31, 2018, the Company had $90 in total assets, including $90 in cash.
• Net Loss. The Company has had net losses of -$202, and net income of -$2,532 for the fiscal years ended December 31, 2019 and December 31, 2018, respectively.
• Liabilities. The Company's liabilities totaled $2,581 for the fiscal year ended December 31, 2019 and $2,581 for the fiscal year ended December 31, 2018.

Liquidity & Capital Resources

To-date, the company has been financed with $4,542,297 in debt.

After the conclusion of this Offering, should we hit our minimum funding target, we expect to continue to be cashflow positive.

We plan to use the proceeds as set forth in this Form C under "Use of Funds". We don’t have any other sources of capital in the immediate future.

We will likely require additional financing in excess of the proceeds from the Offering in order to perform operations over the lifetime of the Company. We plan to raise capital in 24 months. Except as otherwise described in this Form C, we do not have additional sources of capital other than the proceeds from the offering. Because of the complexities and uncertainties in establishing a new business strategy, it is not possible to adequately project whether the proceeds of this offering will be sufficient to enable us to implement our strategy. This complexity and uncertainty will be increased if less than the maximum amount of securities offered in this offering is sold. The Company intends to raise additional capital in the future from investors. Although capital may be available for early-stage companies, there is no guarantee that the Company will receive any investments from investors.

Runway & Short/Mid Term Expenses

Armbrust Inc. cash in hand is $1,687,453.88, as of September 2020. Over the last three months, revenues have averaged $1,883,457.64/month, cost of goods sold has averaged $1,006,015.46/month, and operational expenses have averaged $1,095,452.02/month, for an average burn rate of $218,009.84 per month.

We started producing masks, selling direct to consumers and to governments and institutions. This has caused us to generate $7.27mm in less than six months of operation.

We hope revenues will increase to over $3mm per month breaking $36mm annual run rate before Q1 2021. These projections cannot be guaranteed.

We primarily fund the business from sales direct from over 50,000 consumer accounts and hundreds of enterprise accounts. If existing consumer sales were to evaporate we could sustain the business on current capital and enterprise contracts for the next 24 months.