Planet Green (PLAG) - 2023 Q2 - Quarterly Report

Financial Position - As of June 30, 2023, total assets decreased to $48.83 million from $60.72 million as of December 31, 2022, representing a decline of approximately 19.7%[15] - Current assets increased to $17.65 million, up from $13.83 million, marking a growth of about 27.5%[15] - Total liabilities rose to $22.51 million, compared to $20.13 million at the end of 2022, indicating an increase of approximately 11.8%[15] - Stockholders' equity decreased significantly to $26.32 million from $40.59 million, reflecting a decline of about 35.2%[16] - Cash and cash equivalents increased to $713,196 from $93,487, showing a substantial growth of approximately 664.5%[15] - The company reported an accumulated deficit of $133.37 million as of June 30, 2023, compared to $119.88 million at the end of 2022[16] - The working capital deficit stood at $4,358,221 as of June 30, 2023[48] Revenue and Profitability - Net revenues for Q2 2023 were $4,573,443, a decrease of 70.5% compared to $15,544,255 in Q2 2022[19] - Gross profit for Q2 2023 was $42,654, down from $742,062 in Q2 2022, reflecting a significant decline in profitability[19] - The company reported a gross profit of $289,080 for the six months ended June 30, 2023, down 84.8% from $1.91 million in the same period of 2022[19] - Operating expenses for the six months ended June 30, 2023, totaled $2.70 million, a decrease of 40.4% from $4.50 million in the same period of 2022[19] - The net loss attributable to common shareholders for Q2 2023 was $12,199,648, compared to a loss of $1,484,847 in Q2 2022, indicating a substantial increase in losses[19] - The company reported a net loss attributable to common shareholders of $12.20 million for the six months ended June 30, 2023, compared to a loss of $2.71 million in the same period of 2022, indicating a significant increase in losses[19] Cash Flow and Financing - Cash used in operating activities decreased to $(2,240,110) in 2023 from $(8,200,350) in 2022, showing improved cash flow management[26] - The company reported a net cash provided by investing activities of $2,749,143 in 2023, a recovery from $(3,853,678) in 2022[26] - The cash and cash equivalents at the end of the year increased to $713,196 in 2023 from $378,697 in 2022, reflecting a positive cash position[26] - Interest paid decreased to $245,734 in 2023 from $327,695 in 2022, indicating reduced financing costs[26] - The company made no payments for short-term loans in 2023, compared to $(574,175) in 2022, suggesting a shift in financing strategy[26] - The company issued 10,000,000 shares for cash, raising $4,100,000 during the period[21] Acquisitions and Investments - The acquisition of Jingshan Sanhe Luckysky New Energy Technologies Co., Ltd. involved the issuance of 2,200,000 shares of common stock in exchange for 85% equity interest[90] - Total consideration for the acquisition of Jilin Chuangyuan Chemical Co., Ltd. was $8,085,000, with approximately $3.19 million of goodwill attributed to expected synergies[98] - The acquisition of Shandong Yunchu Supply Chain Co., Ltd. resulted in a net asset acquisition valued at $5,420,920, with goodwill of approximately $4.72 million expected from operational synergies[103] - The acquisition of Anhui Ansheng Petrochemical Equipment Co., Ltd. had a total consideration at fair value of $7,926,000, with goodwill of approximately $10.26 million arising from expected synergies[108] - The company consolidated the accounts of Jilin Chuangyuan Chemical Co., Ltd. as its Variable Interest Entity (VIE)[95] Operational Strategy - The company anticipates continued market expansion and product development in the upcoming quarters, although specific financial guidance was not provided[6] - The Company considers itself to be operating within one reportable segment based on qualitative and quantitative criteria[46] - The Company has a 100% equity interest in several subsidiaries, including Jiayi Technologies (Xianning) Co., Ltd. and Jilin Chuangyuan Chemical Co., Ltd., enhancing its operational control[29] - The company is engaged in various businesses through its subsidiaries in China, indicating a diversified operational strategy[29] - The Company has entered into exclusive VIE agreements with several entities, allowing it to consolidate their accounts as variable interest entities[39] Tax and Regulatory Matters - The U.S. corporate tax rate decreased from 34% to 21% under the "Tax Cuts and Jobs Act," effective for the fiscal year ending December 31, 2022[137] - The corporate income tax rate in the PRC is 25%, applicable to the Company's operations in that region[141] - The Company has no assessable profits derived from Hong Kong since inception, resulting in no provisions for Hong Kong profit tax[140] Other Financial Metrics - Basic and diluted loss per share for Q2 2023 was $(0.17), compared to $(0.03) in Q2 2022[19] - The weighted average shares outstanding for Q2 2023 were 72,081,930, an increase from 54,165,263 in Q2 2022[19] - The effective tax rate for the Company was 0.59% for the six months ended June 30, 2023, down from 5.25% in 2022[144] - The allowance for doubtful accounts as of June 30, 2023, was $353,060, down from $366,301 at the end of 2022[114] - The interest expense for the six months ended June 30, 2023, was $135,452, compared to $208,280 for the same period in 2022[133]