Financial Performance - Total revenue for the six months ended March 31, 2023, was $10,253,163, representing a 8.3% increase from $9,467,621 in the same period of 2022[7] - Gross profit for the six months ended March 31, 2023, was $3,530,873, up 12.7% from $3,132,522 in the prior year[7] - Net income for the six months ended March 31, 2023, increased to $1,766,347, a 44.4% rise compared to $1,225,864 in the same period of 2022[7] - For the six months ended March 31, 2023, net revenue was $10,253,163, up from $9,467,621 for the same period in 2022, indicating a year-over-year increase of about 8.3%[28] - The net income for the six months ended March 31, 2023, was $1,766,347, compared to $1,225,864 for the same period in 2022, reflecting a growth of approximately 44.4%[28] - Revenue and net income (excluding foreign currency translation impact) increased by 18.7% and 57.9% in RMB for the six months ended March 31, 2023, compared to the same period last year[65] - The increase in revenue and net income in USD was 12.7% and 44.1%, respectively, due to an 8.7% depreciation of RMB against USD[65] Assets and Liabilities - Total current assets as of March 31, 2023, were $29,089,100, a significant increase from $18,903,147 as of September 30, 2022[4] - Total liabilities as of March 31, 2023, were $7,475,978, an increase from $5,703,843 as of September 30, 2022[4] - As of March 31, 2023, total assets amounted to $24,235,276, an increase from $20,939,534 as of September 30, 2022, representing a growth of approximately 15.5%[28] - The Company had short-term investments of $4,696,503 as of March 31, 2023, compared to $2,276,158 as of September 30, 2022, marking an increase of about 106.5%[34] - Total shareholders' equity rose to $23,546,519 as of March 31, 2023, compared to $15,235,691 as of September 30, 2022, reflecting a growth of 54.5%[5] Cash Flow - The Company reported net cash provided by operating activities of $2,743,493 for the six months ended March 31, 2023, compared to a cash outflow of $(51,274) for the same period in 2022[28] - Cash and cash equivalents at the end of the period increased to $8,684,188 from $4,792,632 at the end of the previous period[12] Shareholder Activities - The company issued 1,000,000 ordinary shares in an initial public offering, raising gross proceeds of $8,000,000[9] - The Company closed its initial public offering on March 30, 2023, selling 1,000,000 ordinary shares at a price of $8.00 per share, with an additional 47,355 shares sold under the over-allotment option[29] - The company closed its initial public offering on March 30, 2023, raising total gross proceeds of $8,000,000 from the sale of 1,000,000 ordinary shares[113] Research and Development - Research and development expenses for the six months ended March 31, 2023, were $631,034, down 29.3% from $892,524 in the same period of 2022[7] - The company recorded VAT tax refunds associated with export sales amounting to $526,779 for the six months ended March 31, 2023[58] Accounts Receivable - Accounts receivable from third-party customers amounted to $4,054,688 as of March 31, 2023, with a net balance of $3,869,399 after an allowance for doubtful accounts of $185,289[75] - Approximately 88.8% of the accounts receivable balance as of March 31, 2023, or $3.4 million, has been subsequently collected[76] - Total accounts receivable from related parties increased to $291,883 as of March 31, 2023, up 15.2% from $253,473 on September 30, 2022[87] - Approximately 72.1% of the accounts receivable from related parties as of March 31, 2023, have been collected, with the remaining expected to be collected before September 30, 2023[87] Taxation - The impact of tax holidays decreased the company's income taxes by $195,135 for the six months ended March 31, 2023, compared to $149,628 for the same period in 2022[101] - For the six months ended March 31, 2023, the total income tax provision was $204,053, compared to $50,408 for the same period in 2022, representing a significant increase[102] - The effective tax rate for the six months ended March 31, 2023, was 10.4%, up from 3.9% in 2022, influenced by a 25% statutory rate and various adjustments[105] - The company reported an increase in income tax payable to $289,427 as of March 31, 2023, compared to $170,887 as of September 30, 2022[106] Market Performance - Revenue from the China domestic market was $1,634,219, up 29.2% from $1,264,539 in the prior year[52] - Revenue from the overseas market increased to $8,618,944, compared to $8,203,082, reflecting a growth of 5.1%[52] - Revenue from wheelchairs was $8,381,323, a rise of 5.4% from $7,949,623 in the previous year[53] - One customer accounted for approximately 70.3% of total revenue for the six months ended March 31, 2023, compared to 76.1% in the same period of 2022[109] Operational Insights - The Company has not provided any financial support to the VIE and its subsidiaries during the six months ended March 31, 2023, and 2022[27] - The VIE's net profits after tax payments are to be paid as service fees to Erhua Med, but no such fees were paid as of March 31, 2023[27] - The Company has not experienced losses from political, economic, and legal uncertainties in the PRC but acknowledges potential future impacts[63] - The ongoing military conflict between Russia and Ukraine has not yet impacted the Company's operations, but uncertainties remain regarding future developments[66] Asset Management - The company did not recognize any impairments of long-lived assets as of March 31, 2023[45] - The company offers a 10-year warranty for wheelchair frames and a one-year warranty for other parts, with warranty costs historically being immaterial[49] - The company signed a loan agreement with Bank of Jiangsu for RMB 10.0 million ($1,456,000) at a fixed interest rate of 3.65% per annum, maturing on March 28, 2024[85] - The restricted net assets as of March 31, 2023, totaled $1,914,531, compared to $1,737,982 as of September 30, 2022[116] - The company has not experienced any losses in cash accounts held at financial institutions, totaling $6,787,221 outside of PRC and $1,890,435 within PRC as of March 31, 2023[108] Depreciation and Amortization - As of March 31, 2023, net property, plant, and equipment amounted to $1,582,650, a decrease of 2.8% from $1,627,962 on September 30, 2022[80] - The company reported a depreciation expense of $111,964 for the six months ended March 31, 2023, down 21.6% from $142,954 for the same period in 2022[80] - Land use rights, net, increased to $166,476 as of March 31, 2023, compared to $163,213 on September 30, 2022, reflecting a growth of 2.0%[82] Company Structure - The Company completed a reorganization on November 26, 2020, establishing Jin Med, Zhongjin HK, and Erhua Med, with Erhua Med becoming the primary beneficiary of the Variable Interest Entity (VIE), Changzhou Zhongjin[17] - The company has only one reporting segment, focusing on the design and manufacture of wheelchair and other living aids products[119]
Jin Med(ZJYL) - 2023 Q3 - Quarterly Report