# EDGAR Filing Document

**Accession Number:** 0001883835
**File Stem:** 0001520138-25-000260
**Filing Date:** 2025-8
**Character Count:** 61005
**Document Hash:** 2d6de2fe45f1d9bd922496195eedfd37
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001520138-25-000260.hdr.sgml**: 20250815

**ACCESSION NUMBER**: 0001520138-25-000260

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 48

**CONFORMED PERIOD OF REPORT**: 20250630

**FILED AS OF DATE**: 20250815

**DATE AS OF CHANGE**: 20250815

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** ESG Inc.
- **CENTRAL INDEX KEY:** 0001883835
- **STANDARD INDUSTRIAL CLASSIFICATION:** AGRICULTURE PRODUCTION - CROPS [0100]
- **ORGANIZATION NAME:** 08 Industrial Applications and Services
- **EIN:** 871918342
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-56532
- **FILM NUMBER:** 251222619

**BUSINESS ADDRESS:**
- **STREET 1:** 523 SCHOOL HOUSE RD
- **CITY:** KENNETT SQUARE
- **STATE:** PA
- **ZIP:** 19348
- **BUSINESS PHONE:** 267-467-5871

**MAIL ADDRESS:**
- **STREET 1:** 523 SCHOOL HOUSE RD
- **CITY:** KENNETT SQUARE
- **STATE:** PA
- **ZIP:** 19348

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** PLASMA INNOVATIVE INC.
- **DATE OF NAME CHANGE:** 20210920

?xml version='1.0' encoding='ASCII'?

**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 June 30, 2025**

☐ 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. 000-56532

**ESG INC.** 

(Exact name of registrant as specified in its charter)

---

| | |
|:---|:---|
| **Nevada** | **87-1918342** |
| (State or Other Jurisdiction of<br> Incorporation or Organization) | (I.R.S. Employer<br> Identification No.) |
| **433 East Hillendale Road**<br> **Chadds Ford, PA** | **19317** |
| (Address of Principal Executive Offices) | (Zip Code) |

---

**267-467-5871**

(Registrant's telephone number, including area code)

N/A

(Former Name, former address and former fiscal year, if changed since last report)

Securities registered under Section 12(b) of the Exchange Act: None

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," "non-accelerated filer," " smaller reporting company," and " emerging growth company " in Rule 12b-2 of the Exchange Act. (Check all that apply):

Large accelerated filer ☐ Accelerated filer ☐ <br> Non-accelerated filer ☒ Smaller reporting company ☒ <br> 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 ☒

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: 25,899,468 common shares issued and outstanding as of August 14, 2025

ESG INC.

QUARTERLY REPORT ON FORM 10-Q

**TABLE OF CONTENTS**<sup>1</sup>

---

| | | |
|:---|:---|:---|
|  |  | Page |
| [PART I](#a_001) | [FINANCIAL INFORMATION:](#a_001) |  |
| [Item 1.](#a_002) | [Financial Statements (Unaudited)](#a_002) | [1](#a_002) |
|  | [Consolidated Balance Sheets as of June 30, 2025 (Unaudited) and December 31, 2024](#a_003) | [1](#a_003) |
|  | [Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three and Six Months Ended June 30, 2025 and 2024 (Unaudited)](#a_004) | [2](#a_004) |
|  | [Consolidated Statements of Changes in Stockholders' Equity for the Three and Six Months Ended June 30, 2025 and 2024(Unaudited)](#a_005) | [3](#a_005) |
|  | [Consolidated Statements of Cash Flows for the Six Months ended June 30, 2025 and 2024 (Unaudited)](#a_006) | [4](#a_006) |
|  | [Notes to the Unaudited Financial Statements](#a_007) | [5](#a_007) |
| [Item 2.](#a_008) | [Management's Discussion and Analysis of Financial Condition and Results of Operations](#a_008) | [13](#a_008) |
| [Item 3.](#a_009) | [Quantitative and Qualitative Disclosures About Market Risk](#a_009) | [17](#a_009) |
| [Item 4.](#a_010) | [Controls and Procedures](#a_010) | [17](#a_010) |
| [PART II](#a_011) | [OTHER INFORMATION:](#a_011) |  |
| [Item 1.](#a_012) | [Legal Proceedings](#a_012) | [19](#a_012) |
| [Item 1A](#a_013) | [Risk Factors](#a_013) | [19](#a_013) |
| [Item 2.](#a_014) | [Unregistered Sales of Equity Securities and Use of Proceeds](#a_014) | [19](#a_014) |
| [Item 3.](#a_015) | [Defaults Upon Senior Securities](#a_015) | [19](#a_015) |
| [Item 4.](#a_016) | [Submission of Matters to a Vote of Securities Holders](#a_016) | [19](#a_016) |
| [Item 5.](#a_017) | [Other Information](#a_017) | [19](#a_017) |
| [Item 6.](#a_018) | [Exhibits](#a_018) | [19](#a_018) |
|  | [Signatures](#a_019) | [21](#a_019) |

---

<sup>1</sup> Printer to update

**PART I. FINANCIAL INFORMATION**

***Item 1. Financial Statements.***

**ESG INC.**

**Consolidated Balance Sheet**

(**Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **June 30,**<br>**2025** | **December 31,**<br>**2024** |
| **Assets** |  |  |
| Current Assets |  |  |
| Cash | $129372 | $110343 |
| Restricted cash |  | 56398 |
| Accounts receivable | 3637675 | 2917093 |
| Inventories | 2114503 | 2906383 |
| Other receivable | 277984 | 245232 |
| Advance to suppliers | 494520 | 736094 |
| Total Current Assets | 6654054 | 6971543 |
| Property, plant and equipment, net | 16815744 | 17184192 |
| Intangible assets, net | 2954995 | 2934213 |
| Value added tax receivable | 2872675 | 2704109 |
| Total Non-current Assets | 22643414 | 22822514 |
| **Total Assets** | $29297468 | $29794057 |
| **Liabilities and Shareholders' Equity** |  |  |
| Current Liabilities |  |  |
| Short-term bank loans | $6002150 | $5988024 |
| Account payable | 1494224 | 4604011 |
| Accrued expenses and other current liabilities | 4800392 | 3092953 |
| Deferred income, current | 113704 | 121897 |
| Total Current liabilities | 12410470 | 13684988 |
| Bank loans |  |  |
| Deferred income | 1051664 | 1073487 |
| Long-term payable | 1031438 | 1095690 |
| Total Non-current liabilities | 2083102 | 2169177 |
| **Total Liabilities** | 14493572 | 15854164 |
| **Commitments and Contingencies** |  |  |
| **Shareholders' Equity** |  |  |
| Common stock | 25900 | 25900 |
| Additional paid in capital | 11152388 | 11152388 |
| Accumulated comprehensive income (loss) | (289746) | (711270) |
| Accumulated deficit | 136290 | (168600) |
| Total Company stockholders' Equity | 11024832 | 10298418 |
| Noncontrolling interest | 3779064 | 3519577 |
| Total Equity | 14803896 | 13817995 |
| **Total Liabilities and Stockholders' Equity** | $29297468 | $29794057 |

---

*The accompanying notes are an integral part of these consolidated financial statements.*

**ESG INC.**

**CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS**

**(Unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **June 30, 2025** | **June 30, 2024** | **June 30, 2025** | **June 30, 2024** |
| Revenues | $2490036 | $2509781 | $4077180 | $4888062 |
| Cost of goods sold | 1407670 | 2077594 | 2913882 | 4546508 |
| Gross profit | 1082366 | 432187 | 1163298 | 341554 |
| Operating expenses |  |  |  |  |
| Selling, General and administrative expense | 120934 | 147590 | 410264 | 465906 |
| Research and development cost | 155053 | 128696 | 221376 | 259784 |
| Total operating expenses | 275987 | 276286 | 631640 | 725690 |
| Income (Loss) from operations | 806379 | 155901 | 531658 | (384136) |
| Non-operating income (expense) |  |  |  |  |
| Interest expense | (133921) | (132118) | (264323) | (281605) |
| Other Income | 23944 | 80540 | 152914 | (15424) |
| Total non-operating income (expenses), net | (109977) | (51578) | (111409) | (297029) |
| Income (Loss) before income taxes | 696402 | 104323 | 420249 | (681165) |
| Income taxes | - | - | - | - |
| Net income (loss) | 696402 | 104323 | 420249 | (681165) |
| Less: income (loss) attributable to noncontrolling interest | 178848 | 22976 | 115359 | (174845) |
| Net income (loss) to ESG Inc. | $517554 | $81347 | $304890 | $(506320) |
| Other comprehensive item |  |  |  |  |
| Foreign currency translation gain (loss) attributable to the Company | 129638 | (8033) | 421524 | (167613) |
| Foreign currency translation gain (loss) attributable to noncontrolling interest | 44326 | (2746) | 144128 | (57310) |
| Comprehensive income (loss) attributable to the Company | 647192 | 73314 | 726414 | (673933) |
| Comprehensive income (loss) attributable to noncontrolling interest | 223174 | 20230 | 259487 | (232155) |
| Net income (loss) per share - basic and diluted | $0.01 | $0.00 | $0.03 | $(0.03) |
| Weighted average shares outstanding - basic and diluted | 25899468 | 25899468 | 25899468 | 25899468 |

---

*The accompanying notes are an integral part of these consolidated financial statements*.

**ESG INC.**

**CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY** 

**(Unaudited)**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Common stock** | **Common stock** | | | | | | |
|  | **Share** | **Amount** | **Additional paid aid-in**<br>**capital** | **Accumulated income**<br>**(deficit)** | **Accumulated other comprehensive**<br>**income** | **Total Company's**<br>**equity** | **Noncontrolling**<br>**interest** |<br>**Total** |
| **Balance at December 31, 2024** | 25899468 | $25900 | $11152388 | $(168600) | $(711270) | $10298418 | $3519577 | $13817995 |
| Net income |  |  |  | (212664) |  | (212664) | (63489) | (276153) |
| Foreign currency translation adjustment | - | - | - | - | 291886 | 291886 | 99802 | 391688 |
| **Balance at March 31, 2025** | 25899468 | $25900 | $11152388 | $(381264) | $(419384) | $10377640 | $3555890 | $13933530 |
| Net income |  |  |  |  | 517554 | 517554 | 178848 | 696402 |
| Foreign currency translation adjustment |  |  |  |  | $129638 | $129638 | $44326 | $173964 |
| **Balance at June 30, 2025** | 25899468 | $25900 | $11152388 | 136290 | (289746) | 11024832 | 3779064 | 14803896 |
| **Balance at December 31, 2023** | 25899468 | $25900 | $11152388 | $(1113233) | $(430206) | $9634849 | $3312459 | $12947308 |
| Net income |  |  |  | (587667) |  | (587667) | (197821) | (785488) |
| Foreign currency translation adjustment | - | - | - | - | (159580) | (159580) | (54564) | (214144) |
| **Balance at March 31, 2024** | 25899468 | $25900 | $11152388 | $(1700900) | $(589786) | $8887602 | $3060074 | $11947676 |
| Net income |  |  |  | $81347 |  | 81347 | 22976 | 104323 |
| Foreign currency translation adjustment |  | - | - | - | (8033) | (8033) | (2746) | (10779) |
| **Balance at June 30, 2024** | 25899468 | $25900 | $11152388 | $(1619553) | $(597819) | $8960916 | $3080304 | $12041220 |

---

*The accompanying notes are an integral part of these consolidated financial statements*.

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended** | **For the Six Months Ended** |
|  | **June 30, 2025** | **June 30, 2024** |
| **Cash flows from operating activities:** |  |  |
| Net income (loss) | $420249 | $(681165) |
| Adjustments to reconcile loss to net cash used in operating activities: |  |  |
| Depreciation and amortization | 922725 | 901289 |
| Changes in assets and liabilities: |  |  |
| Accounts receivable | (658000) | (70139) |
| Inventories | 835870 | (522578) |
| Accounts payables | (3156329) | 1561957 |
| Other current and non-current liabilities | 104207 | (1172556) |
| Net cash provided by (used in) operating activities | (1531277) | 16808 |
| **Cash flows from investing activities:** |  |  |
| Acquisition of fixed assets | (208253) | (264441) |
| Net cash used in investing activities | (208253) | (264441) |
| **Cash flows from financing activities:** |  |  |
| Proceeds from loans |  | 41517 |
| Payment of loans payable | (96521) | (98370) |
| proceeds from non-bank loans | 1437774 | - |
| Net cash provided by (used in) financing activities | 1341253 | (56853) |
| **Effect of exchange rate changes on cash** | 360909 | 97368 |
| **Net increase (decrease) in cash** | (37369) | (207118) |
| **Cash, beginning of year** | 166741 | 342342 |
| **Cash, end of year** | $129372 | $135223 |
| **Supplemental disclosures of cash flow information:** |  |  |
| Cash paid for interest | $(152201) | $(281605) |
| Cash paid for income tax |  |  |

---

*The accompanying notes are an integral part of these consolidated financial statements*.

**ESG INC.**

**NOTES TO CONSOLIDATED FINANCIAL STATEMENTS**

**June 30, 2025<sup>2</sup>**

**(Unaudited)**

**Note 1 – Summary of Significant Accounting Policies**

**Basis of Presentation and Preparation**

The consolidated financial statements include the accounts of ESG Inc. and its wholly owned subsidiaries (collectively "ESG" or the "Company"). In the opinion of the Company's management, the condensed consolidated financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. The preparation of these condensed consolidated financial statements and accompanying notes in conformity with U.S. generally accepted accounting principles ("GAAP") requires the use of management estimates. These consolidated financial statements and accompanying notes should be read in conjunction with the Company's annual consolidated financial statements and accompanying notes included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2024 (the "2024 Form 10-K").

**Note 2 – Going Concern**

The accompanying consolidated financial statements were prepared assuming the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As of June 30, 2025, the Company had limited cash and working capital deficiency of $5,756,417. These factors, among others, raise the substantial doubt about the Company's ability to continue as a going concern. These consolidated financial statements do not include any adjustments that may result from the outcome of these uncertainties.

The working capital deficiency was primarily caused by bank loans and payables. The bank loans had total balance of $6,002,150, and all the bank loans need to be renewed yearly and classified as current liabilities. Management is working to replace current bank loans with long-term loans to improve our capital structure. However, there is no assurance that all management's plans will be successful. In addition, the Company had $2,872,675 of value added tax receivable which was classified as non-current assets as of June 30, 2025, the Company filed application for a tax refund in May, 2025 to enhance our liquidity.

**Note 3 – Revenue**

Net sales disaggregated by significant products for the three and six months ended June 30, 2025 and 2024 were as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  | Three Month Ended | Three Month Ended | % of Total Revenue | % of Total Revenue |
| Geographic | Products | June 30, 2025 | June 30, 2024 | June 30, 2025 | June 30, 2024 |
| China, mainland | Compost III | $490980 | $992593 | 19.7% | 39.5% |
| China, mainland | White Button Mushroom | 887923 | 1517188 | 35.7% | 60.5% |
| China, Hongkong | Mushroom powder seasonings | 1111133 | - | 44.6% | - |
| Total | Total net sales | $2490036 | $2509781 | - | - |

---

**<sup>1</sup>** Printer to add.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |  | Six Month Ended | Six Month Ended | % of Total Revenue | % of Total Revenue |
| Geographic | Products | June 30, 2025 | June 30, 2024 | June 30, 2025 | June 30, 2024 |
| China, mainland | Compost III | $602758 | $1686078 | 31.4% | 34.5% |
| China, mainland | White Button Mushroom | 1281571 | 3201984 | 14.8% | 65.5% |
| China, Hongkong | Mushroom powder seasonings | 2192851 | - | 53.8% | - |
| Total | Total net sales | $4077180 | $4888062 | - | - |

---

**Note 4 – Concentration**

 

*Customer*

The Company had two customers that individually represented 10% or more of total sales, which accounted for 53.8% and 17.2% for the six months ended June 30, 2025. For the year ended December 31, 2025, there were 5 customers sales were over 10% and accounted for 31.1%, 16.0%, 14.6%, 14.0%, and 12.7%.

*Accounts Receivables*

As of June 30, 2025, the account receivable from one customer accounted for 94.9% of the total Company's accounts receivable. As of December 31, 2024, Accounts receivable from one customer accounted for 95.4% of the total Company's accounts receivable balance.

**Note 5 –Consolidated Financial Statement Details**

The following tables show the Company's consolidated financial statement details as of June 30, 2025 and December 31, 2024:

**Inventories**

---

| | | |
|:---|:---|:---|
|  | June 30, 2025 | December 31, 2024 |
| raw materials | $1514133 | $1808253 |
| Inventories in transit |  | 125917 |
| finished goods |  | 650282 |
| work in progress | 600370 | 321931 |
| Total inventories | $2114503 | $2906383 |

---

**Property, Plant and Equipment, Net**

---

| | | |
|:---|:---|:---|
|  | June 30, 2025 | December 31, 2024 |
| Gross property, plant and equipment | $25560158 | $24884609 |
| Accumulated depreciation | (8744414) | (7700417) |
| Total property, plant and equipment, net | $16815744 | $17184192 |

---

**Accrued expenses and other liabilities**

---

| | | |
|:---|:---|:---|
|  | June 30, 2025 | December 31, 2024 |
| Advances from customers | $79565 | $81153 |
| Salary payable | 176485 | 87206 |
| Tax payable | (3026) | 17235 |
| Other payable | 3382655 | 2754809 |
| Long-term payable, current portion | 164713 | 152550 |
| Total | $4800392 | $3092953 |

---

**Note 6 – Account receivables**

As of June 30, 2025 and December 31, 2024, the accounts receivable were $3,637,675 and $2,917,093, respectively. Most of the accounts receivable were from mushroom powder seasoning sales. Deposit and advances are required for Compost III and Fresh mushroom sales.

**Note 7 – Other Payables**

Other payable are primary composed of debt with private fund and accrued interest, deposit and current portion of long term debt. As of June 30, 2025 and December 31, 2024, the Company had outstanding debt with private fund and institutions recorded as other payables for an aggregate carrying amount of $3,322,120 and $2,049,011, respectively.

**Note 8 – Bank Loans**

Short-term bank loans consisted of the following:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| December 31, | 2025 | Interest rate | Due date | 2024 | Interest rate | Due date |
| Agricultural Bank of China Funan Branch (1) | 697925 | 4.65% | 04/02/26 | 781047 | 3.70% | 04/02/25 |
| Anhui Funan Rural Commercial Bank (2) | 1954188 | 5.60% | 12/20/26 | 1918360 | 5.60% | 12/20/25 |
| Anhui Funan Rural Commercial Bank (3) | 1395849 | 5.60% | 03/24/26 | 1370257 | 5.60% | 03/28/25 |
| Anhui Funan Rural Commercial Bank (4) | 837509 | 5.60% | 01/15/26 | 822154 | 5.60% | 01/16/25 |
| Bank of China Funan Branch (5) | 1116689 | 3.60% | 03/13/26 | 1096206 | 3.60% | 03/12/25 |
| Total | $6002150 |  |  | $5988024 |  |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) Loans
are guaranteed by the founder of AUFP and SME Guarantee Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;(2) Loans
are guaranteed by legal representative, the founder, and one shareholder of AUFP, ESG Hainan and SME Guarantee Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;(3) Loans
are guaranteed by legal representative, and the founder of AUFP, AUFP and SME Guarantee Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;(4) Loans
was guaranteed by legal representative and the founder of AUFP, AUFP and SME Guarantee Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;(5) $1,116,689
and $1,096,206 of loans from Bank of China were pledged by buildings as of June 30, 2025, and December 31, 2024, respectively.

**Note 9 – Income Taxes**

The income taxes were zero for the three and six months ended June 30, 2025 and 2024. Compost III and white button mushroom are income tax and VAT tax free products.

**Note 10 – Segment Information**

The following table shows information by reportable segment for the three and six months ended June 30, 2025 and 2024:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | White button mushroom | Compost III | Mushroom powder seasonings | Corporate | Eliminations | Total |
| **Three Months Ended June 30, 2025** |  |  |  |  |  |  |
| Net operating revenues: |  |  |  |  |  |  |
| Third party | $887923 | $490980 | $1111133 | $- | $- | $2490036 |
| Intersegment | 2465 | 171990 |  |  | (174455) |  |
| Total net operating revenues | 890388 | 662970 | 1111133 |  |  | 2664491 |
| Cost of goods sold | 159005 | (6466) | (1560210) |  |  | (1407670) |
| Intersegment cost of goods sold | 207498 | (379488) | (766568) |  | 938558 |  |
| Total net operating cost | (629043) | (385954) | (2326778) |  |  | (3341775) |
| Selling, general administrative expenses | (41968) | (18441) | (55009) | (5515) |  | (120934) |
| Research and development | (67993) | (76391) | (10668) |  |  | (155053) |
| Operating income (loss) | 936966 | 389682 | (514754) | (5515) |  | 806379 |
| Interest income (expense) | (66227) | (8781) | (58913) |  |  | (133921) |
| Other income (loss) — net | 7913 | 1413 | 14618 | - | - | 23944 |
| Income before income taxes | $878652 | $382314 | $(559049) | $(5515) | - | $696402 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | White button mushroom | Compost III | Mushroom powder seasonings | Corporate | Eliminations | Total |
| **Six Months Ended June 30, 2025** |  |  |  |  |  |  |
| Net operating revenues: |  |  |  |  |  |  |
| Third party | $1281571 | $602758 | $2192851 | $- | $- | $4077180 |
| Intersegment | 995546 | 379488 |  |  | (1375034) |  |
| Total net operating revenues | 2277117 | $982246 | 2192851 |  |  | 5452214 |
| Cost of goods sold | (41132) | (153034) | (2719917) |  |  | (2913882) |
| Intersegment cost of goods sold | (995546) | (379488) |  |  | 1682799 |  |
| Total net operating cost | (1036678) | (532522) | (2719917) |  |  | (4288916) |
| Selling, general administrative expenses | (86726) | (24909) | (266132) | (32496) |  | (410264) |
| Research and development | (104748) | (105959) | (10668) |  |  | (221376) |
| Operating income (loss) | 1048964 | 318856 | (803666) | (32496) |  | 531658 |
| Interest income (expense) | (156157) | (18865) | (89301) |  |  | (264323) |
| Other income (loss) — net | 39107 | 85140 | 28667 |  |  | 152914 |
| Income before income taxes | $931914 | $385131 | $(864300) | $(32496) | - | $420249 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | White button mushroom | Compost III | Mushroom powder seasonings | Corporate | Eliminations | Total |
| **Three Months Ended June 30, 2024** |  |  |  |  |  |  |
| Net operating revenues: |  |  |  |  |  |  |
| Third party | $1517188 | $992593 | $- | $- | $- | $2509781 |
| Intersegment |  | 609898 |  |  | (284869) |  |
| Total net operating revenues | 1517188 | 1602491 |  |  |  | 2509781 |
| Cost of goods sold | (1354244) | (326325) | (397025) |  |  | (2077594) |
| Intersegment cost of goods sold | (609898) |  |  |  | 609898 |  |
| Total net operating cost | (1964142) | (326325) | (397025) |  |  | (2077594) |
| Selling, general administrative expenses | (4913) | (74969) | (26859) | (40849) |  | (147590) |
| Research and development | (106171) | (6255) | (16270) |  |  | (128696) |
| Operating income (loss) | 51860 | 585044 | (440155) | (40849) |  | 155901 |
| Interest income (expense) | (75606) | (10872) | (45640) |  |  | (132118) |
| Other income (loss) — net | 22202 | (8648) | 66986 | - | - | 80540 |
| Income before income taxes | $(1544) | $565524 | $(418808) | $(40849) | $- | $104323 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | White button mushroom | Compost III | Mushroom powder seasonings | Corporate | Eliminations | Total |
| **Six Months Ended June 30, 2024** |  |  |  |  |  |  |
| Net operating revenues: |  |  |  |  |  |  |
| Third party | $3201984 | $1686078 | $- | $- | $- | $4888062 |
| Intersegment |  | 894768 |  |  | (894768) |  |
| Total net operating revenues | 3201984 | 2580846 |  |  |  | 4888062 |
| Cost of goods sold | (2469565) | (1234884) | (842059) |  |  | (4546508) |
| Intersegment cost of goods sold | (894768) |  |  |  | 894768 |  |
| Total net operating cost | (3364333) | (1234884) | (842059) |  |  | (4546508) |
| Selling, general administrative expenses | (87649) | (84340) | (243128) | (50789) |  | (465906) |
| Research and development | (156000) | (43784) | (60000) |  |  | (259784) |
| Operating income (loss) | 488770 | 323070 | (1145187) | (50789) |  | (384136) |
| Interest income (expense) | (180064) | (21393) | (80979) | 831 |  | (281605) |
| Other income (loss) — net | 48077 | (154968) | 91467 | - | - | (15424) |
| Income before income taxes | $356783 | $146709 | (1134699) | $(49958) | - | $(681165) |

---

**Note 11 - Correction of Immaterial Misstatement**

During the year ended December 31, 2024, the Company corrected an error that occurred in 2019. The payment of approximately $420,067 was posted under the wrong supplier account which was subsequently settled based on a settlement agreement. The Company determined that the prior year financial statements should be corrected, even though such revision previously was and continues to be immaterial to the prior year financial statements. As a result, the accompanying consolidated balance sheet for the year ended December 31, 2023 has been corrected for the following: accounts payable decreased from $1,450,405 to $1,300,676, the accumulated deficit decreased from $1,224,811 to $1,113,233 and noncontrolling interest increased from $3,274,308 to $3,312,459. The Company assessed the materiality of the misstatement quantitatively and qualitatively and has concluded that the correction of the classification is immaterial to the consolidated financials taken as a whole.

***Item 2. 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 unaudited consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q (this "Form 10-Q") for the quarterly period ended June 30, 2025, as well as the audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the year ended December 31, 2024 filed by the Company with the U.S. Securities and Exchange Commission (the "SEC") on April 15, 2025 (the "2024 Form 10-K"). Some of the information contained in this discussion and analysis or set forth elsewhere in this Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks, uncertainties and assumptions. You should read the "Forward-Looking Statements" and "Risk Factors" sections of this Form 10-Q and our 2024 Form 10-K 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.* 

 

**Forward-Looking Statements**

This Form 10-Q contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements in this report other than statements of historical fact, including statements regarding our business plans and strategies; projections of revenues, expenses, profitability or cash flows; expectations regarding plant expansions, new product development and processing capabilities; the impact of government policies, subsidies or tax incentives; and anticipated benefits of our composting and mushroom-processing initiatives, are forward-looking statements. Words such as "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "project," "seek," "target," "will," "would" and similar expressions are intended to identify forward-looking statements.

These forward-looking statements are based on management's current beliefs and assumptions and on information currently available to us, but involve a number of risks and uncertainties, many of which are beyond our control, that could cause actual results to differ materially from those set forth in or implied by such statements. Important factors that could cause actual results to differ include, but are not limited to, the following (see "Risk Factors" in Part II, Item 1A of our 2024 Form 10-K for further discussion):

&nbsp;&nbsp;&nbsp;&nbsp;· recent shifts in U.S. and international trade policies—especially those
affecting China—may increase tariffs or investment restrictions and adversely impact our supply chain, financing and operating results.

&nbsp;&nbsp;&nbsp;&nbsp;· the impact of contagious-disease outbreaks (e.g., COVID-19 or future epidemics)
on our operations, supply chains and customers;

&nbsp;&nbsp;&nbsp;&nbsp;· our dependence on a small number of large distributors and processors in
China;

&nbsp;&nbsp;&nbsp;&nbsp;· our ability to comply with PRC food-safety, environmental, composting and
export regulations and to maintain all necessary licenses and permits;

&nbsp;&nbsp;&nbsp;&nbsp;· Lack of diversification in our business via a reliance on fresh white button
mushrooms and recent processing business;

&nbsp;&nbsp;&nbsp;&nbsp;· changes to PRC or local tax incentives, farming subsidies or agricultural-development
plans;

&nbsp;&nbsp;&nbsp;&nbsp;· volatility in the cost of substrate materials, energy, labor and transportation;

&nbsp;&nbsp;&nbsp;&nbsp;· our need for and access to additional debt or equity financing on acceptable
terms;

&nbsp;&nbsp;&nbsp;&nbsp;· our common shares are currently listed on the OTCMKTS of the OTC Markets
Group, Inc. which provides shareholders with limited liquidity due to low trade volume and limits our access to the broader capital markets
which may hamper our ability to raise funds and increase share-price volatility.

&nbsp;&nbsp;&nbsp;&nbsp;· delays or cost overruns in facility expansions, equipment installations or
scaling of operations;

&nbsp;&nbsp;&nbsp;&nbsp;· losses due to mushroom diseases, pests or system malfunctions in climate-controlled
facilities;

&nbsp;&nbsp;&nbsp;&nbsp;· as a closely held corporation, a small number of shareholders control a significant
portion of our shares, which may limit trading float and influence governance decisions.

&nbsp;&nbsp;&nbsp;&nbsp;· fluctuations in the exchange rate between the Renminbi and the U.S. dollar
and PRC restrictions on currency conversion;

&nbsp;&nbsp;&nbsp;&nbsp;· our ability to protect proprietary growing, processing and composting technologies
under PRC IP laws;

&nbsp;&nbsp;&nbsp;&nbsp;· evolving PRC and U.S. data-security and privacy laws, and potential impacts
of cybersecurity reviews;

&nbsp;&nbsp;&nbsp;&nbsp;· our dependence on and ability to retain experienced executives and technical
staff;

&nbsp;&nbsp;&nbsp;&nbsp;· our capacity to integrate new operations, strengthen controls and maintain
quality and safety as we grow; and

Other risks described in our filings with the SEC, including elsewhere in this Form 10-Q and our 2024 Form 10-K.

Should any of these or other risks materialize, or should any of the underlying assumptions prove incorrect, actual results may differ materially from those expressed in or implied by forward-looking statements. Except as required by law, we undertake no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise.

**Overview** 

ESG Inc. ("ESG") was incorporated in July 2021 in the State of Nevada under the name "Plasma Innovative Inc." ("Plasma"). On November 6, 2023, Plasma Innovative Inc. entered into a share exchange agreement (the "Share Exchange Agreement") with ESG Inc. ("ESGI"), a Nevada corporation, and the shareholders of ESGI (the "ESGI Shareholders"), whereby One Hundred Percent (100%) of the ownership interest of ESGI was exchanged for 10,432,800 shares of common stock of Plasma issued to the ESGI Shareholders. On November 22, 2023, Plasma Innovative Inc. filed Articles of Merger with the State of Nevada to merge ESG Inc. into Plasma Innovative Inc. Plasma Innovative Inc. was the surviving entity with its name changed into ESG Inc.

ESG is a Nevada holding company, headquartered in Kennett Square, Pennsylvania. Through the deep agricultural and food-industry experience of its management team, ESG develops and operates sustainable, plant-based food-ingredient and production businesses, initially focusing on high-quality mushroom composting, cultivation and processing with plans to expand into broader food-related ventures.

At the top of its corporate structure, ESG holds its Chinese operations through two intermediate entities—ESG China Limited in Hong Kong and Hainan ESG Technology Co., Ltd. ("Hainan ESG") in the PRC. On September 28, 2023, Hainan ESG acquired a 74.52% equity interest in Funan Allied United Farmer Products Co., Ltd. ("AUFP") via a share-exchange transaction. AUFP in turn directly owns two Chinese operating subsidiaries:

&nbsp;&nbsp;&nbsp;&nbsp;· **Anhui Allied United Mushroom Technology Co., Ltd. ("AUMT")** – manufactures Phase III compost using locally sourced straw and manure, with capacity of up to 90,000
tons per year.

&nbsp;&nbsp;&nbsp;&nbsp;· **Anhui Allied United Mushroom Co., Ltd. ("AUM")** – operates mushroom-growing facilities covering roughly 335,000 sq. ft., producing up to 20 million pounds of fresh white button
mushrooms annually.

All of ESG's operations are conducted through these wholly-foreign-owned entities in China (including a WFOE structure), each duly organized under PRC law and holding all required governmental authorizations. The Company exercises full managerial control over its subsidiaries and complies with applicable overseas-listing filing requirements under CSRC Trial Measures and related PRC regulations.

Leveraging its vertically integrated platform, ESG combines advanced composting technology, climate-controlled cultivation and emerging processing capabilities—such as the launch of dried mushroom seasoning powder for export—to meet growing global demand for sustainable, plant-based foods. Guided by our principles, the Company aims to deliver high-quality products while driving innovation, environmental stewardship and long-term value creation.

During the second quarter, the Company initiated a temporary scale-down of production at its China facility to allow for the installation of new equipment and completion of facility construction necessary to comply with China's Environmental Protection Agency (EPA) regulations in order to integrate operations between the existing facility and the planned expansion. While the scale-down of production reduces revenues in 2025, management expects improved operational efficiency and compliance benefits upon completion.

**Available Information**

The Company periodically provides certain information to investors on its corporate website, www.esgfood.net. This includes press releases and other information about financial performance, information on environmental, social and governance matters. The information contained on the websites referenced in this Form 10-Q is not incorporated by reference into this filing. Further, the Company's references to website URLs are intended to be inactive textual references only.

**Results of Operations**

***Comparison of the three months ended June 30, 2025 and 2024***

*Revenue*

 

For the three months ended June 30, 2025, we had revenues of $2,490,036 and $2,509,781, respectively, a $19,745 or 0.8% decrease. The decrease was primarily due to the reduced input and production of Compost III and fresh mushroom, as efforts were prioritized on building an additional environmental protection facility.

*Cost of Goods Sold*

 

For the three months ended June 30, 2025 and 2024 total cost of goods sold was $1,407,670 and $2,077,594, respectively, a decrease of $669,924 or 32.2%. This decrease was primarily due to the reduced input.

*Gross Profit*

 

Gross profit for the three months ended June 30, 2025 was $650,179, compared to $432,187 for the three months ended June 30, 2024. The increase was primarily attributable to a favorable increase in our gross margin to 43.5% from 17.2% for the three months ended June 30, 2025 compared to the same period in 2024.

*Research and Development Expenses*

 

Research and Development expenses increased $26,357, or 20.5% from $128,696 to $155,053 for the three months ended June 30, 2025 compared to the same period in 2024.

*Selling, General and Administrative Expenses*

 

Selling, general and administrative expenses for the three months ended June 30, 2025 decreased $26,656, or 18.1%, from $147,590 to $120,934, compared to the same period in 2024. The decrease was driven primarily by reducing labor costs and tightening control over discretionary spending, like replacing non-essential travel with virtual meetings

*Interest Expenses*

 

Interest expenses increased $1,803, or 1.4 %, to $133,921 for the three months ended June 30, 2025 compared to the same quarter in 2024 due to the decrease of the currency exchange rate.

*Other Income (expenses)*

 

Other income decreased $56,596, or 70.3% from $80,540 to $23,944 for the three months ended June 30, 2025, compared to $80,540 for the same quarter in 2024. The decrease was mainly due to a decrease in the amount of grant received.

***Comparison of the six months ended June 30, 2025 and 2024***

*Revenue*

 

For the six months ended June 30, 2025, we had revenues of $4,077,180 compared to $4,888,062 for the same quarter in 2024, a $810,882 or 16.6% decrease. The decrease was primarily due to the reduced input and production of Compost III and fresh mushroom, as efforts were prioritized on building an additional environmental protection facility.

*Cost of Goods Sold*

 

For the six months ended June 30, 2025 the total cost of goods sold was $2,913,882 compared to the same period in $4,546,508, a decrease of $1,632,626 or 35.9% compared to the same period in 2024. This decrease was primarily due to the reduced production input and efficiency of the production and quality control.

*Gross Profit*

 

Gross profit for the six months ended June 30, 2025 was $1,163,298, compared to $341,554 for the six months ended June 30, 2024. The increase was primarily attributable to a favorable increase in our gross margin to 28.5% from 7.0% for the six months ended June 30, 2025.

*Research and Development Expenses*

 

Research and Development expenses decreased $38,408, or 14.8% from $259,784 to $221,376 for the six months ended June 30, 2025 compared to the same period in 2024.

*Selling, General and Administrative Expenses*

 

Selling, general and administrative expenses for the six months ended June 30, 2025 and 2024 decreased $55,642, or 11.9%, from $465,906 to $410,264, for the same period in 2024. The decrease was driven primarily by reducing labor costs and tightening control over discretionary spending, like replacing non-essential travel with virtual meetings.

*Interest Expenses*

 

Interest expenses decreased $17,282, or 6.1%, to $264,323 for the six months ended June 30, 2025 compared to $281,605 in the same period in 2024. The decrease was primarily due to the impact of currency exchange rate change.

*Other Income (expenses)*

 

Other income increased $168,338, or 1091.4% to $152,914 for the six months ended June 30, 2025, compared to $15,424 of expense for the same period in 2024. The increase was mainly due to the one time written-off of $162,069 in 2024.

**Liquidity and Capital Resources**

As of June 30, 2024, the Company had limited cash and a working capital deficiency of $5,756,417. These factors, among others, raise the substantial doubt about the Company's ability to continue as a going concern. The working capital deficiency was primarily caused by short-term bank loans and payables. The bank loans had total balance of $6,002,150, and all the bank loans need to be renewed yearly and classified as current liabilities.

The management is working to finance our cash needs through a combination of equity offerings, debt financings and collaboration agreements. However, there is no assurance that all management's plans will be successful.

.

***Cash Flows from Operating Activities***

Net cash used in operating activities during the six months ended June 30, 2025 was $1,531,277 and generated $16,808 by operating activities for the six months ended June 30, 2024, a decrease of $1,548,085, or 9210.4%. This increase was primarily due to $3,156,329 of net accounts payable paid.

***Cash Flows from Investing Activities***

Net cash used in investing activities during the six months ended June 30, 2025 and 2024 was $208,253 compared to $264,441 during the same period in 2024, a decrease of $56,188, or 21.2%. The investing activities were PPE purchases both in 2025 and 2024.

 

***Cash Flows from Financing Activities***

Net cash provided in financing activities during the six months ended June 30, 2025 was $1,341,253 and -$56,853 compared to the same period in 2024, an increase of $1,398,106, or 2459.2%. The Company borrowed $1,437,774 and made a payment of $96,521 during the six months ended June 30, 2025. The Company borrowed $41,517 and made a payment of $98,370 toward debt during the six months ended June 30, 2024.

 

***Off-Balance Sheet Arrangements***

There were no off-balance sheet arrangements as of June 30, 2025, or that in the opinion of management that are likely to have, a current or future material effect on our financial condition or results of operations.

**Contractual Obligations**

Our long-term debt obligations as of June 30, 2025 were $1,031,438. $164,713 was included in accrued expenses and other current labilities as current portion of long-term liabilities and expected to be paid within 12 months. Our long-term debt obligations are related to assets acquisition. Refer to "Note 11 - Assets Acquisition and Long-term Payable" in our Annual Report on Form 10-K filed with the SEC on April 15, 2025.

**Recently Issued Accounting Pronouncements**

*Disaggregation of Income Statement Expenses*

In November 2024, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") No. 2024-03, *Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses* ("ASU 2024-03") and in January 2025, the FASB issued ASU No. 2025-01, *Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date*, which clarified the effective date of ASU 2024-03. ASU 2024-03 will require the Company to disclose the amounts of purchases of inventory, employee compensation, depreciation and intangible asset amortization, as applicable, included in certain expense captions in the Consolidated Statements of Operations, as well as qualitatively describe remaining amounts included in those captions. ASU 2024-03 will also require the Company to disclose both the amount and the Company's definition of selling expenses. The Company is currently evaluating the effect ASU 2024-03 may have on its consolidated financial statements and related disclosures.

*Income Taxes*

In December 2023, the FASB issued ASU No. 2023-09, *Income Taxes (Topic 740): Improvements to Income Tax Disclosures* ("ASU 2023-09"), which will require the Company to disclose specified additional information in its income tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. ASU 2023-09 will also require the Company to disaggregate its income taxes paid disclosure by federal, state and foreign taxes, with further disaggregation required for significant individual jurisdictions. The Company is currently evaluating the effect ASU 2023-09 may have on its consolidated financial statements and related disclosures.

**Critical Accounting Policies and Estimates**

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates, assumptions, and judgments that affect the amounts reported in the financial statements, including the notes thereto. For a description of the Company's critical accounting policies and estimates, refer to "Part II—Item 7—Management's Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates" in our Annual Report on Form 10-K filed with the SEC on April 15, 2025. There were no significant changes to our critical accounting policies during the six months ended June 30, 2025.

***Item 3. Quantitative and Qualitative Disclosures about Market Risk****.*

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

***Item 4. Controls and Procedures.***

**Evaluation of Disclosure Controls and Procedures**

In connection with the preparation of this Form 10-Q, an evaluation was carried out by the Company's management, with the participation of the principal executive officer, of the effectiveness of the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act ("Exchange Act") as of June 30, 2025. Disclosure controls and procedures are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Commission's rules and forms, and that such information is accumulated and communicated to management, including the principal executive officer, to allow timely decisions regarding required disclosures.

Based on that evaluation, the Company's management concluded, as of the end of the period covered by this report, that the Company's disclosure controls and procedures were not effective in recording, processing, summarizing, and reporting information required to be disclosed, within the time periods specified in the Commission's rules and forms, and that such information was not accumulated and communicated to management, including the principal executive officer and the principal financial officer, to allow timely decisions regarding required disclosures.

**Change in Internal Control over Financial Reporting**

During the six months ended June 30, 2025, there have been no changes in internal control over financial reporting that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

**Limitations of the Effectiveness of Internal Controls**

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the internal control system are met. Because of the inherent limitations of any internal control system, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected.

**PART II. Other Information**

***Item 1. Legal Proceedings***

From time to time, we may be involved in litigation that arises through the normal course of business. As of the date of this filing, we are not aware of any material legal proceedings to which we or any of our subsidiaries is a party or to which any of our property is subject, nor are we aware of any such threatened or pending litigation or any such proceedings known to be contemplated by governmental authorities.

***Item 1A. Risk Factors***

As a "smaller reporting company" as defined by Item 10 of Regulation S-K, the Company is not required to provide information required by this Item.

During the second quarter, the Company initiated a temporary scale-down of production at its China facility to allow for the installation of new equipment and completion of facility construction necessary to comply with China's Environmental Protection Agency (EPA) regulations in order to integrate operations between the existing facility and the planned expansion. The Scale-down of production will become the suspension of production if it is necessary by the construction and installation. The suspension is expected to last approximately three months if any, during which time production will be reduced or nothing. While the scale-down and the suspension if any is anticipated to temporarily reduce revenues in 2025, management expects improved operational efficiency and compliance benefits upon completion.

Our decision to temporarily scale down or suspend production if necessary at our China facility to complete China's EPA compliance upgrades and integrate expansion may result in decreased revenue and increased costs in the near term. Delays in construction, equipment Installation, or regulatory approvals could extend the shutdown period, adversely affecting our financial results.

***Item 2. Unregistered Sale of Equity Securities and Use of Proceeds***

None.

***Item 3. Defaults Upon Senior Securities***

None.

***Item 4. Mine Safety Disclosures***

Not applicable.

***Item 5. Other Information***

As reported by the Company on a Current Report on Form 8-K filed with the SEC on August 8, 2025, on August 8, 2025, the Company terminated Prager Metis CPAs, LLC ("Former Auditor") as its independent registered public accounting firm and engaged Boladale Lawal & Co. ("New Auditor") as its independent registered public accounting firm which was approved by the Company's Board of Directors.

***Item 6. Exhibits***

**Item 6. Exhibits.**

---

| | |
|:---|:---|
| **Exhibit** | **Description** |
| 3.1 | [Articles of Incorporation (incorporated by reference to Exhibit 3.1(a) to the Registration Statement on Form S-1 filed with the SEC on September 24, 2021)](https://www.sec.gov/Archives/edgar/data/1883835/000152013821000572/plasma-09222021_s1ex3z1.htm) |
| 3.2 | [Agreement and Plan of Merger, dated effective as of November 16, 2023, by and between Plasma Innovative Inc. and ESG Inc. (incorporated by reference herein to Exhibit 2.1 to the Current Report on Form 8-K filed with the SEC on December 1, 2023)](https://www.sec.gov/Archives/edgar/data/1883835/000152013823000520/pmin-20231129_8kex2z1.htm) |
| 3.3 | [Articles of Merger between Plasma Innovative Inc. and ESG Inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the SEC on December 1, 2023)](http://www.sec.gov/Archives/edgar/data/1883835/000152013823000520/pmin-20231129_8kex3z1.htm) |
| 3.4 | [Bylaws of the Company (incorporated by reference to Exhibit 3.2(a) to the Registration Statement on Form 10-Q filed with the SEC on September 21, 2021).](https://www.sec.gov/Archives/edgar/data/1883835/000152013821000572/plasma-09222021_s1ex3z2.htm) |
| 10.1 | [Technology Assignment Agreement, dated August 6, 2021, by and between Plasma Innovative Inc. and Hanliang Shao, (incorporated by reference herein to Exhibit 10.1 to the Registration Statement on Form 10-Q filed with the SEC on September 21, 2021)](https://www.sec.gov/Archives/edgar/data/1883835/000152013821000572/plasma-09222021_s1ex10z1.htm) |
| 10.2 | [Investment and Cooperation Agreement, dated January 4, 2021, between the company and Funan Agricultural Reclining Investment Co. Ltd (incorporated by reference to Exhibit 10.2 to the Registration Statement on Form S-1/A filed with the SEC on September 19, 2024)](https://www.sec.gov/Archives/edgar/data/1883835/000152013824000304/esgh-20240918_s1aex10z2.htm) |
| 10.3 | [Share Exchange Agreement between ESG Inc. and Funan Allied United Farmer Products Co., Ltd, dated September 28, 2023 (incorporated by reference to Exhibit 10.1 to the Curent Report on Form 8-K filed with the SEC on November 9, 2023)](http://www.sec.gov/Archives/edgar/data/1883835/000152013823000479/pmin-20231108_8kex10z1.htm) |
| 10.4 | [Share Exchange Agreement between Plasma Innovative Inc. with ESG Inc. dated November 6, 2023 (incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K filed with the SEC on November 9, 2023)](http://www.sec.gov/Archives/edgar/data/1883835/000152013823000479/pmin-20231108_8kex99z1.htm) |
| 16.1 | [Letter from RH CPA, dated March 23, 2025 (incorporated by reference to Exhibit 16.01 to the Current Report on Form 8-K filed with the SEC on March 26, 2025).](https://www.sec.gov/Archives/edgar/data/1883835/000152013825000083/esg-20250323_8kex16z1.htm) |
| 31.1\* | [Certification of the Principal Executive and Financial Officer pursuant to Rule 13(a)-14(a) of the Securities Exchange Act of 1934](esgh-20250630_10qex31z1.htm) |
| 32.1\* | [Certification of the Principal Executive Officer and Principal Financial pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](esgh-20250630_10qex32z1.htm) |
| 101.INS\* | XBRL INSTANCE DOCUMENT |
| 101.SCH\* | XBRL TAXONOMY EXTENSION SCHEMA DOCUMENT |
| 101.CAL\* | XBRL TAXONOMY CALCULATION LINKBASE DOCUMENT |
| 101.DEF\* | XBRL TAXONOMY DEFINITION LINKBASE DOCUMENT |
| 101.LAB\* | XBRL TAXONOMY LABEL LINKBASE DOCUMENT |
| 101.PRE\* | XBRL TAXONOMY PRESENTATION LINKBASE DOCUMENT |

---

\* Filed herewith.

**SIGNATURES**

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **ESG INC.** | **ESG INC.** |
| Date: August [ ], 2025 | By: | /s/ Zhi Yang |
|  | Name: | Zhi Yang |
|  | Title: | President and CEO |
|  |  | (Principal Executive, Financial and Accounting Officer) |

---

## Ex-31

**CERTIFICATION OF THE PRINCIPAL EXECUTIVE OFFICER**

**PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Zhi Yang, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. I
have reviewed this Quarterly Report on Form 10-Q (this "report") of ESG Inc. (the "registrant");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Based
on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered
by this report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Based
on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects
the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. As
the registrant's sole certifying officer, I are responsible for establishing and maintaining disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act
Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. Designed
such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Designed
such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision,
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. Evaluated
the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. Disclosed
in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's
most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected,
or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The
registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing
the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. All
significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Any
fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal
control over financial reporting.

---

| |
|:---|
| /s/ *Zhi Yang* |
| Zhi Yang |
| President and CEO |
| (Principal Executive Officer, Principal Financial Officer, and Principal Accounting Officer) |

---

Date: August [ ], 2025

## Ex-32

**CERTIFICATION PURSUANT TO**

**18 U.S.C.** §**1350, AS ADOPTED PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Quarterly Report on Form 10-Q of ESG Inc. (the "Company") for the period ended June 30, 2025, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned President and Chief Executive Officer of the Company, certifies, to the best knowledge and belief of the signatory, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The
Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The
information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Company.

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

---

| |
|:---|
| /s/ *Zhi Yang* |
| Zhi Yang |
| President and CEO |
| (Principal Executive Officer, Principal Financial Officer, and Principal Accounting Officer) |

---

Date: August [ ], 2025