Financial Performance - For the year ended December 31, 2023, the company reported a net loss of $11.5 million and negative operating cash flows of $13.5 million, primarily due to the economic downturn's impact on business operations [496]. - For the year ended December 31, 2023, the net cash used in operating activities was $(13.5 million), while net cash provided by financing activities was $(1.6 million) [500]. - The provision for inventory adjustments for the year ended December 31, 2023, was $(438,949), indicating a reduction in the carrying value of obsolete or excess inventory [506]. Liquidity and Cash Management - As of December 31, 2023, the company had cash and restricted cash of approximately $1.3 million and working capital of $17.6 million, with $1.2 million of cash held by the VIE in China [497]. - The company expects that cash on hand of approximately $1.2 million and bank borrowing will collectively provide sufficient liquidity for at least the next twelve months [498]. Accounts Receivable and Credit Losses - Approximately $1.2 million, or 47%, of accounts receivable as of December 31, 2023, were collected by March 31, 2024, and approximately $10.9 million, or 81%, of advances to suppliers were utilized [497]. - The allowance for credit losses for accounts receivable was $559,382 as of December 31, 2023, compared to $84,400 in 2022 [505]. Regulatory and Accounting Considerations - The company is required to set aside at least 10% of after-tax profits to fund statutory reserve funds until they reach 50% of registered capital, which may restrict dividend payments [495]. - The company does not expect the adoption of recently issued accounting pronouncements to have a material impact on its financial position or results of operations [494]. Foreign Currency and Risk Management - The company has not entered into any hedging transactions to reduce exposure to foreign currency exchange risk, as its operations are primarily denominated in RMB [491].
Jowell .(JWEL) - 2023 Q4 - Annual Report