Jerash Holdings(US:JRSH)2025-06-23 14:02Financial Data and Key Metrics Changes - Revenue for the fiscal 2025 fourth quarter increased by 35.6% to $29.3 million from $21.6 million in the same quarter last year [13] - Gross profit for the fiscal 2025 fourth quarter advanced nearly 250% to $5.2 million from $1.5 million in the same quarter of last year, with gross margin increasing to 17.9% from 7% [14] - Net loss was reduced to $144,000 or $0.01 per share for the fiscal 2025 fourth quarter from a net loss of $3.1 million or $0.25 per share in the same period last year [17] - Total revenue for fiscal 2025 reached a record high of $146 million [18] Business Line Data and Key Metrics Changes - The company is experiencing strong demand from existing customers and an increase in inquiries from new brands and large apparel manufacturers [4] - The joint venture with Brusena is being terminated due to limited progress, with a focus on diversifying the customer base and expanding the product mix [7] Market Data and Key Metrics Changes - Global brands are seeking manufacturing alternatives out of China and Southeast Asia due to tariff uncertainties, positioning the company favorably with its established operations in Jordan [6] - The company is actively collaborating with the Jordan Ministry of Labor to expand production capacity, targeting an increase of 5% to 10% [11] Company Strategy and Development Direction - The company aims to diversify its direct customer base and expand its product mix to increase year-round capacity utilization and reduce revenue seasonality [7] - A strategic collaboration with Hanseltexa, a major South Korean apparel group, has been secured, marking one of the largest initial orders in the company's history [5] Management's Comments on Operating Environment and Future Outlook - Management noted that revenue remains affected by logistic disruptions due to geopolitical instability, with an estimated $3 million to $4 million in finished goods not shipped until early fiscal 2026 [4] - The company expects revenue for the fiscal 2026 first quarter to be approximately $38 million to $40 million, pending outbound shipping port conditions [18] Other Important Information - The Board of Directors approved a regular quarterly dividend of $0.05 per share payable on June 6, 2025 [19] - The company is exploring additional logistic channels to ensure reliable and timely deliveries amid ongoing geopolitical tensions [12] Q&A Session Summary Question: What are the incremental costs of moving ports from Haifa to the Jordanian port? - The cost to Aqaba is lower than transporting to Haifa, with truckload costs being approximately $1,200 to Aqaba compared to $3,200 to Haifa [21] Question: Are there any order cancellations or just timing issues? - No orders have been canceled; the situation is purely a timing issue due to congestion at Haifa [25] Question: What led to the decision to dissolve the Busana joint venture? - Limited progress in the joint venture and the ability to handle customers independently led to the decision to terminate it [27][28] Question: Can you elaborate on the new opportunity with Hansel? - Hansel is a major importer in South Korea and the number one supplier for Walmart, with plans to increase business through the company [32][36] Question: How are tariffs affecting sourcing decisions? - The tariff situation has prompted brands to seek alternative suppliers, increasing demand for the company's services [41][46] Question: What is the outlook for gross margins given the increased demand? - Gross margins are expected to improve as the company shifts to more FOB business, which typically yields higher margins [58][60] Question: How does the geopolitical situation affect long-term customer relationships? - Jordan is viewed as a safe and stable country, which reassures customers about the continuity of doing business [68] Question: How is the company managing supply chain risks? - The company has established multiple alternative routes for supplies and strengthened sourcing within the region to mitigate risks [73]