Jerash Holdings(JRSH) - 2026 Q1 - Quarterly Results

Fiscal 2026 First Quarter Overview Jerash Holdings reported a significant turnaround in its fiscal 2026 first quarter, moving from operating and net losses to profits, driven by substantial increases in gross profit and margin Key Financial Highlights Jerash Holdings reported a significant turnaround in its fiscal 2026 first quarter, moving from operating and net losses to profits, driven by substantial increases in gross profit and margin - Operating income increased to $959,000, from an operating loss of $829,000 in the prior year quarter[7] - Net income increased to $324,000 from a net loss of $1.4 million in the prior year quarter[7] Gross Profit and Gross Margin | Metric | Q1 FY2026 | Q1 FY2025 | | :--- | :--- | :--- | | Gross Profit ($) | $6.1 million | $4.6 million | | Gross Margin (%) | 15.4% | 11.3% | - Gross profit increased 31.2 percent to $6.1 million, from $4.6 million in the prior year quarter[7] - Gross margin improved 410 basis points to 15.4 percent, from 11.3 percent in the prior year quarter[7] Management Commentary and Strategic Updates The CEO highlighted growing customer demand, enhanced operating efficiency through reduced logistics costs and better production planning, and the successful completion of the first phase of a major order. The company also completed a 15% production capacity expansion - Growing customer demand as companies diversify manufacturing away from China and Southeast Asia[4] - Enhanced operating efficiency achieved through reduced logistics costs and minimal overtime, supported by improved production planning[4] - Successful completion of the first phase of a major initial order from a large U.S.-based multinational and omnichannel retailer, with shipments scheduled from September through February 2026[5] - Expansion of existing manufacturing facilities completed in June 2025, supporting an approximate 15 percent increase in production capacity[6] - Facilities are fully booked through February 2026[8] Business Outlook Jerash Holdings projects strong revenue and gross margin for the fiscal 2026 second quarter, driven by increased capacity and demand, while remaining cautious about potential impacts from tariffs and geopolitical instability - Revenue for the fiscal 2026 second quarter is expected to be approximately $40 million-$42 million[7] - Gross margin goal for fiscal 2026 second quarter is expected to be approximately 15-16 percent[7] - Vigilance maintained regarding potential impacts of recent tariff changes and ongoing geopolitical instability in the region[8] Detailed Financial Performance (Q1 Fiscal 2026) This section details Jerash Holdings' Q1 FY2026 financial results, highlighting revenue, gross profit, operating expenses, net income, and balance sheet changes Revenue and Gross Profit Revenue experienced a slight decline due to shipment delays, but gross profit and gross margin significantly improved, primarily driven by enhanced logistics and production planning Revenue and Gross Profit Metrics | Metric | Q1 FY2026 | Q1 FY2025 | | :--- | :--- | :--- | | Revenue ($) | $39.6 million | $40.9 million | | Gross Profit ($) | $6.1 million | $4.6 million | | Gross Margin (%) | 15.4% | 11.3% | - Slight decline in revenue primarily caused by customer shipments being redirected to Aqaba Port to avoid disruptions at Haifa Port, delaying several orders[9] - Increase in gross profit and margin was primarily driven by improved logistics and production planning, with the resumption of import sea routes through Aqaba Port, providing shorter lead times and lower transportation costs[10] Operating Expenses and Income Operating expenses decreased due to lower stock-based compensation and reduced repair/maintenance costs, leading to a significant improvement from an operating loss to a profit Operating Expenses and Income Metrics | Metric | Q1 FY2026 | Q1 FY2025 | | :--- | :--- | :--- | | Operating Expenses ($) | $5.1 million | $5.5 million | | Operating Income (Loss) ($) | $959,000 | $(829,000) | - Decrease in operating expenses primarily due to lower stock-based compensation expenses and reduced expenses on repair and maintenance[11] - Improvement in operating income mainly attributable to reduced import logistics costs, decreased overtime due to improved logistics and production planning, lower stock-based compensation expenses, and reduced spending on repairs and maintenance[12] Net Income and EPS Total other expenses decreased due to lower interest rates and reduced supply chain financing usage. Despite higher income tax expenses, the company achieved a net profit of $324,000, or $0.03 per diluted share, a significant improvement from a net loss in the prior year Net Income and EPS Metrics | Metric | Q1 FY2026 | Q1 FY2025 | | :--- | :--- | :--- | | Total Other Expenses ($) | $307,000 | $426,000 | | Income Tax Expenses ($) | $329,000 | $112,000 | | Net Income (Loss) ($) | $324,000 | $(1.4 million) | | Diluted EPS ($) | $0.03 | $(0.11) | - Total other expenses decreased primarily due to lower interest rates and a decline in supply chain financing program usage[13] Balance Sheet, Cash Flow, and Dividends As of June 30, 2025, cash and restricted cash totaled $7.5 million, with net working capital at $34.6 million. Cash was reduced due to delayed order shipments. The board approved a regular quarterly dividend of $0.05 per share Balance Sheet Metrics | Metric | As of June 30, 2025 | | :--- | :--- | | Cash and restricted cash ($) | $7.5 million | | Net working capital ($) | $34.6 million | - Cash was reduced at quarter-end due to orders shipping later than expected and payments not received until the start of the following quarter[15] - Jerash's board of directors approved a regular quarterly dividend of $0.05 per share on its common stock, payable on August 29, 2025[15] Consolidated Financial Statements This section provides the unaudited condensed consolidated statements of operations, balance sheets, and cash flows for the reported periods Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) This section presents the unaudited condensed consolidated statements of operations and comprehensive income (loss) for the three months ended June 30, 2025, and June 30, 2024, detailing revenue, cost of goods sold, gross profit, operating expenses, income/loss from operations, other income/expenses, net profit/loss, and earnings per share Statements of Operations and Comprehensive Income (Loss) | | For the Three Months Ended June 30, 2025 ($) | For the Three Months Ended June 30, 2024 ($) | | :--- | :--- | :--- | | Revenue, net | $ 39,629,308 | $ 40,935,716 | | Cost of goods sold | 33,540,428 | 36,295,845 | | Gross Profit | 6,088,880 | 4,639,871 | | Selling, general, and administrative expenses | 4,907,215 | 4,999,744 | | Stock-based compensation expenses | 222,669 | 468,935 | | Total Operating Expenses | 5,129,884 | 5,468,679 | | Income (Loss) from Operations | 958,996 | (828,808) | | Interest expenses | (355,848) | (480,203) | | Other income, net | 49,314 | 54,035 | | Total other expenses, net | (306,534) | (426,168) | | Net profit (loss) before provision for income taxes | 652,462 | (1,254,976) | | Income tax expenses | 328,832 | 111,721 | | Net profit (loss) | 323,630 | (1,366,697) | | Net (profit) loss attributable to noncontrolling interest | (4,954) | 21,481 | | Net profit (loss) attributable to Jerash Holdings (US), Inc.'s Common Stockholders | $ 318,676 | $ (1,345,216) | | Basic and diluted EPS | $ 0.03 | $ (0.11) | | Dividend per share | $ 0.05 | $ 0.05 | Condensed Consolidated Balance Sheets This section provides the unaudited condensed consolidated balance sheets as of June 30, 2025, and March 31, 2025, detailing the company's assets, liabilities, and equity Consolidated Balance Sheets | | June 30, 2025 ($) | March 31, 2025 ($) | | :--- | :--- | :--- | | ASSETS | | | | Cash | $ 5,796,830 | $ 13,346,791 | | Accounts receivable, net | 9,979,463 | 3,076,074 | | Inventories | 27,317,026 | 27,704,829 | | Prepaid expenses and other current assets | 3,285,600 | 3,648,321 | | Advance to suppliers, net | 6,983,612 | 6,644,194 | | Total Current Assets | 53,362,531 | 54,420,209 | | Restricted cash - non-current | 1,704,794 | 1,717,248 | | Long-term deposits | 547,383 | 464,934 | | Property, plant, and equipment, net | 24,912,364 | 25,023,681 | | Goodwill | 499,282 | 499,282 | | Operating lease right of use assets | 712,723 | 850,172 | | Total Assets | $ 81,739,077 | $ 82,975,526 | | LIABILITIES AND EQUITY | | | | Credit facilities | $ 4,768,749 | $ 4,512,462 | | Accounts payable | 6,178,130 | 6,507,308 | | Accrued expenses | 3,655,643 | 4,342,436 | | Income tax payable - current | 1,414,329 | 1,305,386 | | Uncertain tax provision | 175,290 | 175,290 | | Other payables | 1,600,743 | 2,149,185 | | Deferred revenue | 622,099 | 487,004 | | Operating lease liabilities - current | 336,886 | 339,699 | | Total Current Liabilities | 18,751,869 | 19,818,770 | | Deferred tax liabilities, net | 120 | 120 | | Operating lease liabilities - non-current | 197,113 | 287,527 | | Total Liabilities | 18,949,102 | 20,106,417 | | Total Jerash Holdings (US), Inc. Stockholders' Equity | 62,732,240 | 62,816,328 | | Noncontrolling interest | 57,735 | 52,781 | | Total Equity | 62,789,975 | 62,869,109 | | Total Liabilities and Equity | $ 81,739,077 | $ 82,975,526 | Condensed Consolidated Statements of Cash Flows This section presents the unaudited condensed consolidated statements of cash flows for the three months ended June 30, 2025, and June 30, 2024, detailing cash flows from operating, investing, and financing activities Consolidated Statements of Cash Flows | | For the Three Months Ended June 30, 2025 ($) | For the Three Months Ended June 30, 2024 ($) | | :--- | :--- | :--- | | Net profit (loss) | $ 323,630 | $ (1,366,697) | | Net cash used in operating activities | (6,478,515) | (2,200,948) | | Net cash used in investing activities | (714,919) | (386,965) | | Net cash (used in) provided by financing activities | (378,710) | 1,516,001 | | Effect of exchange rate changes on cash and restricted cash | 9,729 | 8,917 | | Net decrease in cash and restricted cash | (7,562,415) | (1,062,995) | | Cash, and restricted cash, beginning of the period | 15,064,039 | 14,036,867 | | Cash, and restricted cash, end of the period | $ 7,501,624 | $ 12,973,872 | | Cash paid for interest | $ 355,848 | $ 480,203 | | Income tax paid | $ 219,889 | $ 726,177 | Additional Information This section provides supplementary details including company overview, conference call information, forward-looking statements disclaimer, and contact information About Jerash Holdings (US), Inc. Jerash Holdings (US), Inc. is a manufacturer and exporter of sportswear and outerwear for leading global brands, operating six factory units and four warehouses with approximately 6,000 employees - Jerash Holdings manufactures and exports custom, ready-made, sportswear and outerwear for leading global brands and retailers[17] - Key brands served include The North Face, Timberland, Vans, New Balance, DKNY, Nautica, FootJoy, American Eagle, and Skechers[17] - The company's production facilities comprise six factory units and four warehouses, employing approximately 6,000 people[17] Conference Call Information Jerash Holdings hosted an investor conference call on August 12, 2025, to discuss its fiscal 2026 first-quarter results, with details provided for phone access and webcast availability - Jerash Holdings hosted an investor conference call on August 12, 2025, at 9:00 a.m. Eastern Time[16] - A live and archived webcast is available online in the investor relations section of Jerash's website[16] Forward-Looking Statements Disclaimer This section contains a standard disclaimer regarding forward-looking statements, noting that actual results may differ materially due to various risks and uncertainties, and the company does not undertake to update these statements - This news release contains forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially[18] - Many factors could cause actual results to differ materially, including those risks described in filings made by Jerash with the U.S. Securities and Exchange Commission[18] - Jerash does not intend and does not assume any obligation to update these forward-looking statements, other than as required by law[18] Contact Information Contact details for investor relations are provided through PondelWilkinson Inc - Contact for investor relations: PondelWilkinson Inc., Judy Lin or Roger Pondel[19] - Phone: 310-279-5980; Email: jlin@pondel.com[19]