Planet Green (PLAG) - 2024 Q2 - Quarterly Report

PART I - FINANCIAL INFORMATION Financial Statements Presents unaudited condensed consolidated financial statements for Planet Green Holdings Corp. as of June 30, 2024, including balance sheets, statements of operations, changes in equity, and cash flows Condensed Consolidated Balance Sheets Total assets slightly decreased to $42.24 million while liabilities increased to $25.71 million, resulting in a $2.91 million reduction in stockholders' equity and an $8.09 million working capital deficit Condensed Consolidated Balance Sheet Highlights (in USD) | Account | June 30, 2024 (Unaudited) | December 31, 2023 | | :--- | :--- | :--- | | Total Current Assets | $13,328,293 | $12,510,477 | | Total Assets | $42,238,506 | $42,629,996 | | Total Current Liabilities | $21,420,765 | $19,185,697 | | Total Liabilities | $25,708,042 | $23,189,784 | | Total Stockholders' Equity | $16,530,464 | $19,440,212 | - The company reported a working capital deficit of $8.09 million as of June 30, 2024[50] Statements of Operations and Comprehensive (Loss) Income Net income reached $4.61 million for the six months ended June 30, 2024, a significant turnaround from a $13.49 million loss in 2023, primarily due to income from discontinued operations despite a 73% revenue decline Six Months Ended June 30, Performance Summary (in USD) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Net Revenues | $3,475,978 | $13,107,735 | | Gross Profit | $430,110 | $289,080 | | Loss from Continuing Operations | $(3,156,608) | $(13,485,019) | | Income from Discontinued Operations | $7,762,377 | $0 | | Net Income (Loss) | $4,605,769 | $(13,485,019) | | Basic and Diluted EPS (Continuing) | $(0.43) | $(1.85) | | Basic and Diluted EPS (Discontinued) | $1.07 | $0 | Three Months Ended June 30, Performance Summary (in USD) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | Net Revenues | $1,945,211 | $4,573,443 | | Gross Profit | $67,305 | $42,654 | | Net Income (Loss) | $5,686,673 | $(12,199,648) | Statements of Changes in Stockholders' Equity Stockholders' equity decreased by $2.91 million to $16.53 million as of June 30, 2024, mainly due to a $7.42 million reduction from deconsolidated operations, partially offset by net income - Total stockholders' equity decreased by $2.91 million to $16.53 million for the six months ended June 30, 2024[26] - Deconsolidation of discontinued operations significantly reduced Additional Paid-in Capital by $7.42 million[26] Statements of Cash Flows Net cash used in operating activities was $0.66 million, while financing activities provided $0.94 million, resulting in a net increase of $0.12 million in cash and cash equivalents for the six months ended June 30, 2024 Cash Flow Summary for the Six Months Ended June 30 (in USD) | Activity | 2024 | 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(660,867) | $(2,240,110) | | Net cash (used in) provided by investing activities | $(160,383) | $2,749,143 | | Net cash provided by financing activities | $941,170 | $33,905 | | Net increase (decrease) in cash | $119,920 | $542,938 | Notes to Financial Statements Notes detail accounting policies, 'Going Concern' warning due to recurring losses and working capital deficit, Variable Interest Entity structure, and significant transactions including a reverse stock split - The company completely disposed of Allinyson Ltd. and its subsidiary Baokuan Technology (Hongkong) Limited on April 1, 2024[38] - A net loss of $3.16 million from continuing operations, an accumulated deficit of $136.12 million, and a working capital deficit of $8.09 million raise substantial doubt about the company's ability to continue as a going concern[50][51] - The company consolidates Jilin Chuangyuan Chemical Co., Ltd. as a Variable Interest Entity (VIE) through contractual agreements, granting control without direct equity ownership[92] - A reverse stock split was executed on May 31, 2024, converting every ten shares of Common Stock into one new share[136] Management's Discussion and Analysis (MD&A) Management discusses financial results for the three and six months ended June 30, 2024, highlighting revenue decline, increased gross profit from advertising, and reiterating 'Going Concern' risk due to operating losses and working capital deficit - Primary business activities include selling tea products, synthetic fuels, chemicals, and providing online advertising services[159] Results of Operations Net revenues for the six months ended June 30, 2024, fell 73% to $3.48 million, primarily due to reduced food and synthetic fuel sales, while gross profit rose 49% to $0.43 million driven by advertising revenue, leading to a net income of $4.61 million Six Months Ended June 30, 2024 vs 2023 (in Thousands USD) | Metric | 2024 | 2023 | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net revenues | 3,476 | 13,108 | (9,632) | (73) | | Gross profit | 430 | 289 | 141 | 49 | | Operating loss | (2,149) | (2,410) | 261 | (11) | | Net (loss) income | 4,605 | (13,485) | 18,090 | (134) | - The six-month revenue decrease was primarily due to food product sales declining from $7.30 million to $1.00 million and synthetic fuel sales decreasing from $4.28 million to $0.06 million[168] - Gross profit increase is attributed to a significant rise in advertising revenue from the Fast branch, which has an approximate 100% gross profit rate[169] Liquidity and Capital Resources As of June 30, 2024, the company had $558,933 in cash, facing a 'Going Concern' issue due to a $3.16 million net loss from continuing operations, a $136.1 million accumulated deficit, and an $8.09 million working capital deficit, with management planning to rely on operations and external funding - Cash and cash equivalents totaled $558,933 as of June 30, 2024, an increase from $436,383 at December 31, 2023[174] - The debt-to-assets ratio increased to 60.86% as of June 30, 2024, from 54.40% as of December 31, 2023[174] - Management acknowledges substantial doubt about the company's ability to continue as a going concern, with future existence dependent on business plan execution and additional funding[175][176] Cash Flows Net cash used in operating activities decreased to $0.66 million, while investing activities used $0.16 million, and financing activities provided $0.94 million, primarily from new loans, for the first six months of 2024 Net Cash Flow Summary (in thousands USD) | Activity | June 30, 2024 | June 30, 2023 | | :--- | :--- | :--- | | Net cash flows used in operating activities | (661) | (2,240) | | Net cash flows (used in) provided by investing activities | (160) | 2,749 | | Net cash flows provided by financing activities | 941 | 34 | Quantitative and Qualitative Disclosures About Market Risk This item was not addressed in the report Controls and Procedures This item was not addressed in the report PART II - OTHER INFORMATION Legal Proceedings The company is involved in a legal proceeding with former employee Daqi Cui, who seeks $609,145.05 in damages for breach of employment contract, with the company filing a motion to dismiss - Former employee Daqi Cui filed a complaint in the Supreme Court of New York, claiming breach of employment contract and seeking $609,145.05 in damages[184] Risk Factors No material changes to risk factors previously disclosed in the company's Form S3/A registration statement filed on April 18, 2023 - As of this report's date, no material changes to risk factors disclosed in the company's Form S3/A registration statement filed on April 18, 2023[185] Unregistered Sales of Equity Securities and Use of Proceeds Not applicable - Not applicable[185] Defaults Upon Senior Securities Not applicable - Not applicable[186] Mine Safety Disclosures Not applicable - Not applicable[186] Other Information None - None[186] Exhibits This section lists exhibits filed with the quarterly report, including officer certifications and Inline XBRL documents - Exhibits filed include Certifications of Principal Executive and Financial Officers pursuant to Sarbanes-Oxley Act Sections 302 and 906, along with Inline XBRL data files[187] Signatures Signatures The report was signed and authorized on August 14, 2024, by Bin Zhou, CEO and Chairman, and Lili Hu, CFO - The report is signed by Bin Zhou (CEO and Chairman) and Lili Hu (CFO) on August 14, 2024[190]