Skillful Craftsman(US:EDTK)2026-01-16 22:30Financial Performance - The company reported a net loss of $1,000,714 for the six months ended September 30, 2025, compared to a net loss of $2,936,434 for the same period in 2024, indicating an improvement of approximately 65.98%[4] - Total comprehensive loss for the six months ended September 30, 2025, was $897,031, down from $2,741,410 in 2024[133] - The Company reported a loss before income taxes of $1,000,714 for the six months ended September 30, 2025, compared to a loss of $2,717,583 for the same period in 2024[111] - Share of profit in subsidiaries for the six months ended September 30, 2025, was a loss of $151,728, compared to a loss of $2,086,395 in 2024[132] Assets and Liabilities - As of September 30, 2025, total assets decreased to $14,947,654 from $15,257,761 as of March 31, 2025, reflecting a decline of approximately 2.03%[2] - Total current liabilities increased to $2,098,710 as of September 30, 2025, from $1,511,786 as of March 31, 2025, representing a rise of approximately 38.73%[2] - The accumulated deficit increased to $5,233,002 as of September 30, 2025, compared to $4,232,288 as of March 31, 2025, reflecting a deterioration of approximately 23.63%[6] - Total liabilities increased to $1,539,415 as of September 30, 2025, from $904,512 as of March 31, 2025[131] Cash Flow - Net cash used in operating activities for the six months ended September 30, 2025, was $544,922, an increase from $236,355 in 2024[134] - Net cash provided by financing activities for the six months ended September 30, 2025, was $400,000, compared to $100,115 in 2024[134] - The company had cash and cash equivalents of $567,533 as of September 30, 2025, down from $1,217,968 as of March 31, 2025, a decrease of approximately 53.38%[2] Operating Expenses - Operating expenses for the six months ended September 30, 2025, totaled $1,242,818, compared to $922,991 for the same period in 2024, an increase of approximately 34.69%[4] - Total selling and general administrative expenses for the six months ended September 30, 2025, were $1,242,818, significantly higher than $922,991 for the same period in 2024[102] - The Company recorded employee benefit expenses of $42,023 for the six months ended September 30, 2025, compared to $34,867 for the same period in 2024, representing an increase of approximately 20%[42] Revenue Recognition - The Company recognizes revenue from technology services, including software development and cloud services, proportionally over the service period[36] - Revenue from software system sales is recognized upon customer acceptance, indicating a performance obligation is fulfilled at that point[37] - The Group's revenue recognition follows ASC 606, ensuring that revenue is recorded when control of promised goods is obtained by the customer[35] Investments and Capital Structure - The company issued 1,000,000 preferred shares as of September 30, 2025, with a par value of $0.0002 per share, reflecting a new capital structure[6] - The company has a 100% ownership in Easy Skills Technology Limited and Skillful Craftsman Network Technology (Wuxi) Co., Ltd., indicating full control over these subsidiaries[14] - The Group applies the equity method for long-term investments in privately held companies, reflecting significant influence without majority ownership[22] - Long-term investments increased to $14,187,730 as of September 30, 2025, from $13,159,074 as of March 31, 2025, reflecting a share gain of $888,398 and foreign currency translation adjustments of $140,258[83] Taxation - The effective tax rate for the six months ended September 30, 2025 was impacted by a benefit for income taxes at the statutory tax rate of 25%, amounting to $250,179[111] - The Group's PRC subsidiaries are subject to a statutory income tax rate of 25% as per the EIT Law effective since January 1, 2008[107] - The Company has no significant unrecognized uncertain tax positions as of September 30, 2025, and March 31, 2025[48] Going Concern - The Group's financial statements are prepared on a going concern basis, dependent on financial support from shareholders and the ability to obtain necessary equity financing[75] - The Company reported negative operating cash flows of $1,011,462 as of September 30, 2025, raising substantial doubt regarding its ability to continue as a going concern[75] Discontinued Operations - The Group's revenue from discontinued operations for the period from April 1, 2025, to September 30, 2025, was $0, compared to $119,018 for the same period in 2024[78] - Revenue from discontinued operations was $119,018 for the six months ended September 30, 2024, with no revenue reported for the same period in 2025[100] - The net loss from discontinued operations for the period from April 1, 2024, to September 30, 2024, was $(218,851)[78]