Jerash Holdings(US:JRSH)2025-08-12 14:00Financial Data and Key Metrics Changes - Revenue for the fiscal 2026 first quarter was $39.6 million, a slight decline from $40.9 million in the same quarter last year, primarily due to shipment delays [12] - Gross profit increased by 31.2% to $6.1 million from $4.6 million in the same quarter last year, with gross margin rising to 15.4% from 11.3% [12][13] - Operating income improved to $959,000 from an operating loss of $829,000 in the prior year quarter [13] - Net income for the fiscal 2026 first quarter was $324,000, recovering from a net loss of $1.4 million in the same quarter last year [14] - Cash and restricted cash totaled $7.5 million, with net working capital at $34.6 million [15] Business Line Data and Key Metrics Changes - The company successfully completed production of the first phase of a major order from a U.S.-based multinational retailer, indicating strong operational performance [5] - The expansion of manufacturing facilities in Amman was completed in June, with an estimated 15% increase in production capacity expected to contribute to performance starting in the second fiscal quarter [10][11] Market Data and Key Metrics Changes - The company is experiencing increased inquiries from global brands seeking to diversify their manufacturing away from Asia, particularly in light of the 15% U.S. tariff on products from Jordan [3][9] - Shipping logistics have improved significantly since mid-July 2025, allowing for more reliable shipping routes to support global customers [9] Company Strategy and Development Direction - The company is focused on diversifying its customer base and product mix to optimize production capacity and improve margins [10] - Future expansion plans are being evaluated, with a cautious approach due to geopolitical instability and tariff uncertainties [23][24] - The company aims to enhance operational efficiency while exploring larger-scale expansion plans for the coming year [16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about growing customer demand and the potential impacts of tariff changes and geopolitical instability [6] - The company is consulting with international tax experts to optimize its tax structure, which is currently affected by local taxes in Jordan and Hong Kong [14][36] Other Important Information - The company declared a quarterly regular dividend of $0.05 per share, payable on August 29, 2025 [17] - The company is booked through February 2026, with additional capacity expected to be gradually integrated [37] Q&A Session Summary Question: Are there now tariffs being paid for products from Jordan? - Yes, currently there is a 15% tariff [19] Question: Was there a sales shift from the first quarter into the second quarter? - Yes, a few orders were shifted to July, but it was not significant [21] Question: Can you provide details on longer-term expansion plans? - The company is planning a longer-term expansion but is cautious due to geopolitical uncertainties and tariffs, focusing on training new workers and expanding existing facilities for now [23][24] Question: Can you elaborate on the relationship with Hansel and order activity? - The company has secured two significant orders from Hansel, with ongoing discussions for further collaboration [28][29] Question: What is the effective tariff rate compared to other countries? - The current tariff for Jordan is 15%, which is competitive compared to other countries like Bangladesh and Vietnam [46][50] Question: How is the joint venture with Busana performing? - The joint venture has been terminated as the company can directly deal with customers [56]