HWH International(US:HWH)2026-03-25 23:02Financial Performance - Total revenue for the years ended December 31, 2025, and 2024 was $866,926 and $1,253,577, respectively, reflecting a decrease of approximately 30.8%[102]. - The net loss for the years ended December 31, 2025, and 2024 was $2,657,929 and $2,765,767, respectively, indicating a slight improvement in loss[102]. - Revenue from food and beverage sales accounted for approximately 100% of total revenue in both years ended December 31, 2025, and 2024[103]. - The cost of revenue decreased from $651,721 in 2024 to $407,199 in 2025, a reduction of approximately 37.5% due to the cessation of café operations[114]. - Operating expenses increased from $3,186,287 in 2024 to $3,648,405 in 2025, primarily due to increased general and administrative expenses[116]. - Net loss decreased slightly from $2,765,767 in 2024 to $2,657,929 in 2025, indicating a marginal improvement in financial performance[118]. - The accumulated deficit increased from $6,317,010 in 2024 to $8,947,630 in 2025, reflecting a rise of approximately 41.4%[168]. - The company reported a total stockholders' equity of $2,684,725 in 2025, down from $2,877,199 in 2024, a decrease of about 6.7%[168]. - Basic and diluted loss per common share improved to $(0.40) in 2025 from $(0.76) in 2024, showing a decrease in loss per share of 47.4%[170]. - Total comprehensive loss attributable to common stockholders was $3,277,631 in 2025, compared to $2,810,541 in 2024, an increase of approximately 16.6%[170]. Cash Flow and Assets - Cash decreased significantly from $4,341,746 as of December 31, 2024, to $2,085,918 as of December 31, 2025, while total assets also fell from $6,408,722 to $4,567,858 during the same period[119]. - Net cash used in operating activities was $1,750,290 in 2025, a decrease from $1,819,262 in 2024, attributed to gains from the disposal of a subsidiary and foreign exchange transaction gains[126][127]. - Net cash used in investing activities was $1,188,686 in 2025, a significant decline from net cash provided of $20,452,029 in 2024, due to various payments for related party loans and marketable securities[126][128]. - Net cash provided by financing activities was $934,714 in 2025, a turnaround from net cash used of $15,597,681 in 2024, driven by common stock issuance[126][129]. - Total assets decreased from $6,408,722 in 2024 to $4,567,858 in 2025, representing a decline of approximately 28.7%[168]. - Current assets fell from $5,474,997 in 2024 to $2,972,037 in 2025, a decrease of about 45.1%[168]. - Cash reserves decreased significantly from $4,341,746 in 2024 to $2,085,918 in 2025, down by approximately 52.1%[168]. - Total liabilities decreased from $3,531,523 in 2024 to $1,883,133 in 2025, a reduction of about 46.4%[168]. Business Operations and Strategy - Hapi Marketplace, launched on November 4, 2024, features over 47 product categories and aims to expand into South Korea and Hong Kong[95]. - Hapi Wealth Builder is set to launch in selected regions later in 2026, focusing on equity investment and wealth-building strategies[100]. - The company plans to open additional Hapi Cafés globally, having already opened locations in Seoul and Singapore, but closed several due to unsustainable revenue[97]. - The company is currently developing digital content and partnerships for Hapi Marketplace and Hapi Wealth Builder, with regional infrastructure setup underway[89]. - Hapi Cafés are integral to the business model, with locations opened in Seoul and Singapore, although some cafés were closed due to unsustainable revenue[186]. - The company is focusing on expanding its product range into robotics for consumer and commercial markets as part of its growth strategy[185]. Compliance and Regulatory Matters - The company received a notice from Nasdaq regarding non-compliance with the minimum market value of listed securities, with a compliance period until September 3, 2024, to regain compliance[130][131]. - The company executed a 1-for-5 reverse stock split effective February 24, 2025, to comply with Nasdaq listing requirements[135]. - Management identified material weaknesses in internal controls over financial reporting, including limited accounting personnel and inadequate segregation of duties[151]. - The company has not opted out of the extended transition period under the JOBS Act, allowing it to adopt new accounting standards at the same time as private companies[197]. Related Party Transactions and Liabilities - The company has significant transactions with related parties, which may not be conducted at arm's length, as noted in the financial statements[159]. - The total amount due to D. Boral Capital as of December 31, 2025, is $829,182, including $710,625 in principal and $118,557 in interest[260]. - Ketomei Pte Ltd owes $22,415 to DBS Bank Limited as of December 31, 2025[261]. - The amount due to Alset Inc. at December 31, 2025, is $569,614, an increase from $209,614 in 2024[263]. - The amount due to Alset International Limited at December 31, 2025, is $4,653,037, down from $5,096,047 in 2024[268]. Impairments and Write-offs - The Company reported an impairment loss on goodwill of $116,648 in 2025, down from $323,864 in 2024, representing a decrease of approximately 64.0%[170]. - The Company recorded impairment of property and equipment of $17,686 for the year ended December 31, 2025, compared to $69,293 in 2024[255]. - The Company wrote off $5,878 in fixed assets due to the closure of Alset F&B (PLQ) Pte. Ltd. in 2024[195]. - The Company entered into a share subscription agreement for 19% of Ideal Food & Beverage Pte. Ltd. for a subscription fee of $14,010, which was impaired to $0 due to net liabilities[257].