Business Expansion and Acquisitions - As of September 30, 2021, the company launched its first RAS demo site in Taiwan and is promoting RASs while seeking cooperation with the local solar energy industry[101] - The company plans to sell over 5,000 tanks in the next five years, with production facilities to be established in Taiwan for sales into the Americas and European countries[106] - The company completed the acquisition of 229 acres of land in Montgomery County, Alabama, intending to build RASs for fish farming by the end of 2024[107] - On September 7, 2022, the company purchased an 80% controlling interest in Meixin Institutional Food Development Co., Ltd. for $4,300,000, gaining control and management of Meixin[101] - The company entered into a Variable Interest Entity Purchase Agreement with Zhejiang Xinca Mutual Entertainment Culture Media Co., Ltd., exchanging 1,800,000 shares for a 100% controlling interest[104] - The company plans to expand fish farming demo sites in Taiwan by adding 20 units of RAS eel farming equipment and build a catfish farm in the U.S.[107] - The company has ceased all operations in China and moved its technology and back-office operations to Taiwan, focusing on becoming a global leader in land-based aquaculture[99] Financial Performance - Revenue for the three months ended June 30, 2024, was $6,753,112, a 26.8% increase from $5,327,181 in the same period of 2023[177] - Gross profit for the three months ended June 30, 2024, was $45,787, up 23.1% from $37,235 in the comparable period in 2023[178] - General and administrative expenses decreased to $308,795 for the three months ended June 30, 2024, from $368,667 in the same period of 2023, a reduction of 16.2%[179] - Other income for the three months ended June 30, 2024, was $16,136, compared to an expense of $880 in the same period of 2023[180] - Income tax expense for the six months ended June 30, 2024, was $122,380, compared to $0 in the same period of 2023[181] - Net loss attributable to the company for the three months ended June 30, 2024, was $354,278, compared to a loss of $331,374 in the same period of 2023[176] - Comprehensive loss attributable to the company for the six months ended June 30, 2024, was $596,762, compared to a loss of $1,291,494 in the same period of 2023[176] - Revenue for the six months ended June 30, 2024, was $11,652,992, a 27.2% increase from $9,165,044 in the same period of 2023[177] - Gross profit for the six months ended June 30, 2024, was $129,748, up 22.5% from $105,891 in the comparable period in 2023[178] - The foreign currency translation gain for the six months ended June 30, 2024, was $244,941[177] - Net loss attributable to the Company for the three months ended June 30, 2024 was $354,278, compared to a net loss of $311,374 for the same period in 2023, indicating a worsening of approximately 13.8%[183] - For the six months ended June 30, 2024, the net loss attributable to the Company was $840,698, a significant improvement from a net loss of $1,299,022 in the comparable period in 2023, reflecting a decrease of approximately 35.3%[183] Cash Flow and Financial Position - Cash and cash equivalents as of June 30, 2024, were $586,424, down from $1,116,183 in 2023, representing a decrease of approximately 47.4%[143] - Net cash used in operating activities for the six months ended June 30, 2024 was $658,042, compared to $649,888 for the same period in 2023, showing a slight increase of approximately 1.8%[186] - The Company had a cash balance of $586,424 as of June 30, 2024, with stockholders' equity amounting to $803,618, indicating a stable financial position[184] - Net cash provided by investing activities was $212,007 for the six months ended June 30, 2024, a recovery from a net cash outflow of $1,057,870 in the same period in 2023[188] - The Company plans to build land-based fish farming demo sites in Taiwan, the U.S., and Brazil, which will require additional capital for construction, marketing, and operations[189] - The Company is focused on growing its existing product offerings and customer base to increase revenues, while also controlling cash expenses as a percentage of expected revenue[184] - Future business demands may lead to cash utilization at levels greater than recently experienced, indicating potential liquidity challenges[184] - The Company may need to raise additional capital in the future, but there is no assurance that it will be able to do so on acceptable terms[184] Accounting and Financial Reporting - Accounts receivable are stated at the original amount less an allowance for doubtful accounts, which is assessed based on various factors including aging and economic trends[144] - Inventories are valued at the lower of cost or net realizable value, with costs determined using the weighted average method[147] - Property and equipment are recorded at cost less accumulated depreciation, with depreciation calculated using the straight-line method over estimated useful lives[148] - Goodwill is tested for impairment annually, with the last assessment date being October 1st, and is recognized when the estimated fair value of a reporting unit is less than its carrying amount[153] - Share-based compensation is measured based on the grant date fair value, utilizing the Black-Scholes pricing model, which incorporates various subjective assumptions[155] - The company recognizes an impairment loss for long-lived assets when the carrying amount exceeds the estimated undiscounted future cash flows expected from the assets[159] - Financial assets are classified into categories such as FVTPL, FVTOCI, and amortized cost, with specific measurement criteria for each category[129] - The loss allowance for accounts receivable is measured at an amount equal to lifetime expected credit losses, reflecting the credit risk since initial recognition[135] - The company applies ASC Topic 820 for fair value measurements, establishing a hierarchy based on observable and unobservable inputs[139] - The acquisition method of accounting requires the Company to make estimates and assumptions regarding fair values, which could materially impact its results of operations and financial position[191] Operational Challenges - The company’s operations are significantly impacted by geopolitical conditions, trade disputes, and inflation, which may affect profit margins and operational stability[110] - The company is actively working to resolve complexities related to the Zhe Jiang Acquisition and will file a Current Report on Form 8-K upon consummation[103]
Nocera (NCRA) - 2024 Q2 - Quarterly Report