Cheetah Net Supply Chain Service (CTNT) - 2024 Q4 - Annual Report

Financial Performance - The company reported a net loss of $5.2 million for the year ended December 31, 2024, primarily due to the wind-down of the discontinued parallel-import vehicle operations and increased operating expenses associated with the transition to logistics and warehousing services [195]. - Total revenue from continuing operations was $455,805 in 2024, reflecting the company's shift to logistics and warehousing services after discontinuing the parallel-import vehicle business [194]. - The company experienced a 95.7% drop in revenue from parallel-import vehicle sales, decreasing from $38.3 million in 2023 to $1.6 million in 2024 [183]. - The company recorded a loss from discontinued operations of approximately $2.0 million in 2024, compared to income of $1.8 million in 2023 [196]. - The net loss from continuing operations was $3.2 million in 2024, compared to a net loss of $1.7 million in 2023 [207]. - Revenue from discontinued operations fell to $1.6 million in 2024, a decrease of 95.7% from $38.3 million in 2023, due to the exit from the parallel-import vehicle business [210]. - Total cost of revenue for discontinued operations decreased by 95.0% to $1.7 million in 2024, down from $34.1 million in 2023 [211]. - Gross loss for discontinued operations was $24,820 in 2024, compared to a gross profit of $4.2 million in 2023, reflecting a decline of 100.6% [212]. - Total selling, general, and administrative expenses for discontinued operations increased by 175.8% to $1.8 million in 2024, driven by credit losses and forfeited vehicle deposits [213]. - Net cash provided by operating activities from discontinued operations was $3.7 million in 2024, down from $7.2 million in 2023 [225]. Operational Changes - The company relocated its headquarters from Charlotte, NC, to Irvine, CA, to enhance focus on logistics and warehousing operations [186]. - The company acquired TWEW in December 2024 to further expand its logistics services [186]. - The company is actively integrating TWEW's operations to strengthen its position in the logistics sector [187]. - The Company depleted its inventory of vehicles by the first quarter of 2024, with the entire inventory balance of $1,515,270 as of December 31, 2023, reclassified to discontinued operations [263]. - As of December 31, 2023, the Company operated as a single reportable segment focused on parallel-import vehicles, but transitioned back to a single segment focused on logistics and warehousing services by December 31, 2024 [257]. Expenses and Income - General and administrative expenses increased by $1.4 million (66.3%) to $3.6 million in 2024, driven by higher personnel-related expenses and costs associated with the acquisitions [200]. - Interest income from continuing operations increased to $320,472 in 2024, up from $9,938 in 2023, representing a growth of 3,124.7% [204]. - Total interest expenses decreased by 14.2% to $35,951 in 2024, down from $41,883 in 2023, primarily due to reduced credit card interest [205]. - General and administrative expenses for continuing operations were $3,641,713 in 2024, compared to $2,190,513 in 2023 [243]. - For the year ended December 31, 2024, total selling expenses for the discontinued parallel-import vehicle business were $117,819, down from $668,172 in 2023 [242]. Acquisitions and Intangible Assets - The Company recorded intangible assets from the acquisitions of Edward and TWEW during the year ended December 31, 2024 [264]. - There was no impairment recognized for intangible assets for the year ended December 31, 2024 [265]. - Goodwill is tested for impairment at the reporting unit level, with no impairment recorded as of December 31, 2024 [272]. Future Plans and Reporting - The Company intends to adopt ASU 2023-07 regarding segment reporting in its Annual Report for the year ending December 31, 2025 [276]. - The Company plans to adopt ASU 2023-09 concerning income tax disclosures in its Annual Report for the year ending December 31, 2025 [277]. Fair Value and Impairment - The Company applies a three-level fair value hierarchy for measuring fair value, with Level 1 being quoted prices for identical assets in active markets [269]. - The Company reviews its intangible assets for impairment whenever events indicate that the carrying amount may not be recoverable [264]. - The Company recognizes lease liabilities and right-of-use assets in accordance with FASB ASC No. 842 [271]. - The fair value of the Company's financial instruments approximated the fair value of the respective assets and liabilities as of December 31, 2024 and 2023 [266]. - The Company did not record any impairment for long-lived assets for the years ended December 31, 2024 and 2023 [275].