TMD Energy Ltd(TMDE) - 2025 Q4 - Annual Report

FORM 20-F Filing Information Filing Details This Transition Report on Form 20-F for TMD Energy Limited covers January 1 to June 30, 2025, with shares listed on NYSE American - The report is a Transition Report on Form 20-F for the period from January 1, 2025, to June 30, 2025[2] - TMD Energy Limited is incorporated in the Cayman Islands[3] Securities Registration Details | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | :------------------------------ | :---------------- | :---------------------------------------- | | Ordinary Shares, par value $0.0001 per share | TMDE | NYSE American LLC | - 23,565,000 ordinary shares were outstanding as of June 30, 2025[5] - The registrant is a non-accelerated filer and an emerging growth company, preparing financial statements in accordance with U.S. GAAP[7][8] Table of Contents Conventions and Definitions Definitions This section defines key terms and abbreviations used in the Transition Report, including financial periods, legal entities, and currencies - Key financial periods defined include 6M2024, 6M2025, FY2022, FY2023, and FY2024[11] - The company is referred to as TMD Energy Limited, incorporated in the Cayman Islands on October 17, 2023, and 'our Group' refers to the Company and its subsidiaries[11] - Currencies used are RM (Malaysian Ringgit), SGD (Singapore Dollar), and USD (U.S. dollars)[11] Special Note Regarding Forward-Looking Statements Forward-Looking Statements Disclaimer This section highlights forward-looking statements subject to risks and uncertainties under the 'safe harbor' provision, with no obligation to update - The report contains forward-looking statements made under the 'safe harbor' provision of the Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995[13] - These statements involve known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially[13] - Key areas of forward-looking statements include future business development, economic performance, market competition, legal changes, and managing growth[15] - The company operates in an evolving environment and undertakes no obligation to update forward-looking statements, except as required by law[14] PART I ITEM 5. Operating and Financial Review and Prospects This section analyzes the Group's financial condition and results, covering recent developments, performance, liquidity, capital resources, and critical accounting estimates 5.A. Operating Results The company, a holding entity in oil trading and bunkering, completed an IPO and changed its fiscal year-end, with operations affected by market and geopolitical risks - The company is a holding company primarily engaged in oil trading and bunkering in Malaysian waters, with plans for regional expansion[18][20] - The company completed its IPO on NYSE American on April 22, 2025, raising $11.59 million in gross proceeds[21] - The fiscal year-end was changed from December 31 to June 30 on May 16, 2025, to align with the holding company[22] - Key operational factors include reliance on key customers and limited suppliers, senior management retention, oil supply disruptions, and cyclical shipping industry conditions[23][24][25][26][28] - Geopolitical conflicts and trade tensions have impacted oil prices, supply chains, and shipping activity, leading to revenue declines in 6M2025[30][34][36][37][38] Six Months Ended June 30, 2025 Compared to Six Months Ended June 30, 2024 In 6M2025, total revenue decreased by 22.7% to $276.3 million, leading to a $4.5 million net loss due to lower volume, prices, and higher operating expenses Consolidated Results of Operations (6M2025 vs 6M2024) | Metric | 6M2025 (Millions $) | 6M2024 (Millions $) | Variance (Millions $) | Variance (%) | | :------------------------------ | :------------- | :------------- | :--------------- | :----------- | | Total revenues | 276.34 | 357.53 | (81.19) | (22.7) | | Total cost of revenues | (272.36) | (351.98) | (79.62) | (22.6) | | Gross profit | 3.98 | 5.55 | (1.56) | (28.2) | | Total operating expenses | (5.93) | (5.41) | 0.51 | 9.5 | | (Loss) Income from operations | (1.94) | 0.13 | (2.08) | (1,561.7) | | Total other (expenses) income, net | (3.57) | 1.27 | (4.84) | (380.6) | | (Loss) Income before income taxes | (5.51) | 1.40 | (6.91) | (492.5) | | Income tax benefits (expenses) | 0.99 | (0.28) | 1.27 | 456.7 | | Net (loss) income | (4.52) | 1.13 | (5.65) | (501.2) | | Net (loss) income attributable to controlling interest | (4.31) | 0.84 | (5.15) | (613.1) | - Overall revenue decreased by 22.7% to $276.3 million, driven by an 11.2% decrease in oil cargo bunkered volume and a 17.9% decrease in average oil prices[46][47] - Gross profit decreased by 28.2% to $4.0 million, with gross profit margin marginally decreasing from 1.55% to 1.44%, reflecting increased operational expenses and declining bunkering demand[55][56][57][58] - General and administrative expenses increased by 8.8% to $3.3 million, mainly due to higher staff costs and increased management fees to a related party[62][63] - Sundry income shifted to a net expense of $0.8 million from a $3.2 million gain, primarily due to a $1.5 million net foreign currency loss as RM and SGD strengthened against USD[70] - The company recorded an income tax benefit of $1.0 million, mainly due to an over-provision in FY2024 income tax expenses and a net loss in 6M2025[76][77] Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 In FY2024, total revenue increased by 8.8% to $688.6 million, gross profit rose by 32.7% to $16.0 million, but net income decreased by 30.9% to $2.0 million Consolidated Results of Operations (FY2024 vs FY2023) | Metric | FY2024 (Millions $) | FY2023 (Millions $) | Variance (Millions $) | Variance (%) | | :------------------------------ | :------------- | :------------- | :--------------- | :----------- | | Total revenues | 688.61 | 633.08 | 55.53 | 8.8 | | Total cost of revenues | (672.56) | (620.99) | 51.57 | 8.3 | | Gross profit | 16.05 | 12.09 | 3.96 | 32.7 | | Total operating expenses | (10.05) | (9.49) | 0.56 | 5.9 | | Income from operations | 6.00 | 2.61 | 3.39 | 130.2 |