My City Builders Reports $498K Net Loss Amidst Revenue Stagnation and Increased Operating Expenses

My City Builders, Inc. reported a net loss of $498,315 for the fiscal year ending July 31, 2025, a significant increase from a net income of $25,752 in the previous year. The company's revenue remained stagnant, with no income generated from operations in both fiscal years. However, revenue from discontinued operations saw a notable increase, totaling $391,554, compared to $59,300 in the prior year. The increase in losses was primarily attributed to higher operating expenses, which rose to $469,125 from $178,266, and a loss on the sale of subsidiaries amounting to $230,730.

The company underwent significant organizational changes, including a name change from RAC Real Estate Acquisition Corp. to My City Builders, Inc. in January 2023. This rebranding followed the acquisition of RAC, which focuses on real estate transactions, particularly in low-income housing. In March 2023, My City Builders entered into a Limited Liability Company Agreement to develop single-family homes in Gadsden, Alabama. The company also finalized the purchase of additional lots in Gadsden and Glencoe, Alabama, with plans to construct new residential homes and duplex apartments.

Operationally, My City Builders reported having 13 completed homes and one under construction in East Gadsden as of July 8, 2025. Out of the completed properties, seven are leased, and five are on the market for sale. The company aims to bolster its rental demand by constructing new homes on recently acquired lots. However, the company’s financial health remains precarious, with a working capital deficiency of $4,469 and cash reserves of only $2,189 as of July 31, 2025.

The filing also highlighted the company's ongoing legal challenges, including a lawsuit against Fix Pads Holdings, which has impacted its financial performance. The company recognized a nonmonetary gain related to the settlement of properties, but it also faced significant impairment losses. The management expressed concerns about the company's ability to continue as a going concern without additional capital resources, emphasizing the need for financing to support its operations and business development plans.

Looking ahead, My City Builders plans to focus on expanding its real estate development activities, particularly in low-income housing. However, the company faces substantial risks, including its reliance on external financing, the competitive nature of the real estate market, and the need to improve its internal controls over financial reporting. The management's ability to attract qualified personnel and secure necessary funding will be critical to the company's future success.