Financial Performance - Total revenue for the six months ended December 31, 2024, was $7.7 million, a decrease of 15.5% compared to $9.1 million for the same period in 2023[228] - Gross profit for the six months ended December 31, 2024, was $0.5 million, down from $1.7 million in the same period of 2023, representing a decline of 70.6%[228] - The company reported a net loss of $3.3 million for the six months ended December 31, 2024, compared to a net loss of $0.24 million in the same period of 2023[244] - Total revenues decreased by $1.3 million, or 26.9%, from $4.9 million in Q4 2023 to $3.6 million in Q4 2024[248] - The company reported a loss before income taxes of $1.9 million in Q4 2024, compared to income of $92,408 in Q4 2023[269] - Net loss increased to $3.3 million for the six months ended December 31, 2024, compared to a net loss of $0.2 million in the same period in 2023[298] Revenue Breakdown - Revenue from cross-border freight solutions to third parties for the six months ended December 31, 2024, was $6.7 million, compared to $8.6 million in 2023, reflecting a decrease of 22.4%[244] - Revenue from cross-border airfreight solutions fell by $1.1 million, or 35.5%, from $3.1 million in Q4 2023 to $2.0 million in Q4 2024, with volume dropping from approximately 8,217 tons to 4,459 tons[249] - Revenue from cross-border ocean freight solutions decreased by $0.4 million, or 24.2%, from $1.8 million in Q4 2023 to $1.4 million in Q4 2024, with TEU volume declining from 1,330 to 1,046[250] - Revenues from cross-border airfreight solutions fell by $1.3 million, or 23.4%, from $5.5 million in the six months ended December 31, 2023, to $4.2 million in the same period of 2024[277] - Revenues from cross-border ocean freight solutions decreased by $0.3 million, or 8.7%, from $3.5 million in the six months ended December 31, 2023, to $3.2 million in the same period of 2024[278] - Revenue from Asia-based customers increased by $0.1 million, or 5.7%, from $2.6 million in Q4 2023 to $2.8 million in Q4 2024[253] - Revenue from Asia-based customers increased by $1.3 million, or 29.4%, from $4.3 million in the six months ended December 31, 2023, to $5.6 million in the same period of 2024[280] - The company established a new revenue stream in Q4 2024 with $0.2 million from the distribution of pharmaceutical products, compared to no revenue in the same period last year[251] - The company established a new revenue stream from pharmaceutical product distribution, generating $0.2 million in revenue for the six months ended December 31, 2024[279] Expenses and Costs - The cost of revenue from cross-border freight solutions for third parties was $6.2 million for the six months ended December 31, 2024, compared to $6.3 million in 2023, indicating a slight decrease of 2.8%[244] - Cost of revenues decreased by $0.3 million, or 8.7%, from $3.9 million in Q4 2023 to $3.6 million in Q4 2024[257] - Total cost of revenue decreased by $0.2 million, or 2.1%, from $7.4 million in the six months ended December 31, 2023, to $7.2 million in the six months ended December 31, 2024[284] - General and administrative expenses increased by $0.9 million, or 94.1%, from $1.0 million in Q4 2023 to $1.9 million in Q4 2024, representing 53.2% of total revenues[263] - General and administrative expenses increased by $1.9 million, or 103.7%, from $1.8 million in the six months ended December 31, 2023, to $3.7 million in the six months ended December 31, 2024, representing 48.8% of total revenues[289] - Selling expenses amounted to $54,488 in Q4 2024, driven by salaries for the sales team related to the new pharmaceutical product business[262] - Selling expenses amounted to $54,488 for the six months ended December 31, 2024, compared to nil for the same period in 2023, driven by salaries for the new pharmaceutical product business[288] - Salaries and employee benefits expenses increased by $0.4 million, or 64.1%, from $0.6 million in Q4 2023 to $1.1 million in Q4 2024, representing 66.0% of total general and administrative expenses[264] - Professional fees surged by $0.2 million, or 1,359.3%, from $14,802 in Q4 2023 to $216,012 in Q4 2024, accounting for 11.3% of total general and administrative expenses[265] - Traveling and entertainment expenses rose by $0.2 million, or 224.8%, from $87,900 in Q4 2023 to $285,541 in Q4 2024, representing 14.9% of total general and administrative expenses[266] Cash Flow and Financial Position - Net cash used in operating activities was $1,933,000 in the six months ended December 31, 2024, including a net loss of $3,282,227[303] - Cash and cash equivalents at the end of the period were $1.1 million, compared to $340,733 at the end of the same period in 2023[302] - Cash used in operating activities increased by $2,190,836 for the six months ended December 31, 2024, primarily due to a net loss increase of $3,039,166 compared to the prior year[305] - Net cash used in investing activities was $1,350,498 for the six months ended December 31, 2024, primarily due to a net cash payment of $552,721 for intangible assets and a loan of $686,697 to a third party[306] - Net cash provided by financing activities was $4,295,361 for the six months ended December 31, 2024, compared to a net cash used of $15,538 in the same period of the prior year, driven by net proceeds of $5,351,281 from an offering[307] - Current ratio as of December 31, 2024, was 0.81:1, with current assets of $4.4 million and current liabilities of $5.4 million, resulting in negative working capital of $1.1 million[299] Business Expansion and Operations - The company fulfilled over 48,000 cross-border supply chain solution orders with an aggregate assessed value of $1.0 billion as of December 31, 2024[226] - The company acquired 100% equity interest in Hupan Pharmaceutical, expanding its business segment into pharmaceutical distribution and supply chain services[227] - The company operates three regional warehousing and distribution centers with a total area of approximately 142,484 square feet and 52 docks[225] - As of December 31, 2024, the company collaborated with over 200 domestic ground transportation carriers to enhance its service offerings[224] - The company aims to improve service quality and expand its customer base to achieve sustainable business growth[229] Future Outlook and Accounting Standards - The company expects capital expenditures to increase in the future, funded by existing cash balances and loans[309] - The company does not anticipate that recently issued accounting standards will have a material effect on its financial statements[320] - The company is evaluating the impact of ASU No. 2023-07, effective for annual periods beginning after December 15, 2023, which will require additional disclosures regarding reportable segment expenses[318] - The company plans to adopt ASU No. 2023-09 regarding income tax disclosures, effective after December 15, 2024, which will require disaggregated information about effective tax rate reconciliation[319] Contractual Obligations - Total contractual obligations as of December 31, 2024, amounted to $6,141,765, with $3,203,278 due within one year[310] - There were no off-balance sheet arrangements that could materially affect the financial condition or results of operations as of December 31, 2024[311]
Lakeside Holding Limited(LSH) - 2025 Q2 - Quarterly Report