SBC Medical Group Holdings Incorporated(SBC) - 2024 Q2 - Quarterly Report

Financial Performance - For the three months ended June 30, 2024, the company reported a net loss of $308,266, attributed to operating and formation costs of$460,648, franchise tax of $41,073, and income tax expense of$40,507, partially offset by interest and dividend income of $233,962 from investments held in the Trust Account [150]. - For the six months ended June 30, 2024, the company had a net loss of$600,812, resulting from operating and formation costs of $923,287, franchise tax expense of$83,100, and income tax expense of $85,722, with interest and dividend income of$491,297 from investments held in the Trust Account [152]. - The company had a net income of $196,786 for the three months ended June 30, 2023, from interest and dividend income of$836,888, offset by operating and formation costs of $430,842, franchise tax expense of$42,532, and income tax expense of $166,728 [151]. - For the six months ended June 30, 2023, the company reported a net income of$810,119, driven by interest and dividend income of $2,101,363, partially offset by operating and formation costs of$805,330, franchise tax expense of $56,491, and income tax expense of$429,423 [153]. Cash Flow and Liquidity - For the six months ended June 30, 2024, net cash used in operating activities was $895,262, compared to$1,315,001 for the same period in 2023, indicating a decrease of approximately 32% [154][155]. - Net cash provided by investing activities for the six months ended June 30, 2024, was $3,260,369, a significant decrease from$100,883,237 in 2023, reflecting a decline of over 96% [157][158]. - For the six months ended June 30, 2024, net cash used in financing activities was $1,264,667, a decrease from$99,078,879 in 2023, indicating a significant reduction in financing outflows [158]. - The company expects to need additional capital to satisfy liquidity needs beyond the net proceeds from the Initial Public Offering, indicating potential financial strain [163]. Business Combination and Future Plans - The company extended the date to consummate a business combination from February 9, 2024, to November 9, 2024, with no additional amount to be paid by the Sponsor into the Trust Account [133]. - The total consideration for the Business Combination is valued at $1,200,000,000, subject to adjustments based on SBC's Net Working Capital and outstanding indebtedness at Closing [138]. - The company has until November 9, 2024, to consummate a business combination, with a mandatory liquidation if not completed by that date, raising concerns about its ability to continue as a going concern [163]. Outstanding Obligations and Financial Position - As of June 30, 2024, the outstanding balance under the Convertible Promissory Note amounted to$2,700,000, increased from $1,000,000 as of December 31, 2023 [148]. - As of June 30, 2024, the company had a working capital deficit of$1,992,535 and an accumulated deficit of $6,596,081, highlighting ongoing financial challenges [163]. - The company incurred a loss from operations of$1,006,387 for the six months ended June 30, 2024, compared to a loss of $861,821 in the same period of 2023, representing an increase in operational losses of approximately 17$115,000,000 from the sale of 11,500,000 units, including an over-allotment option [159]. - The underwriters received a cash underwriting discount of $1,955,000 upon the closing of the Initial Public Offering, with additional deferred fees of$4,025,000 contingent on a successful business combination [169]. Shareholder Activity - The company has approximately $17.9 million remaining in the trust account after stockholders redeemed an aggregate of 273,334 shares of Class A common stock during the Second Special Meeting [133]. - The company entered into a non-redemption agreement to acquire 1,500,000 to 1,700,000 shares of Class A common stock, with the Holder purchasing 1,460,771 shares as of June 30, 2024, not meeting the minimum share requirement for incentive shares [132]. Administrative Costs - The company incurred$60,000 in administrative support fees for the six months ended June 30, 2024, reflecting ongoing operational costs [167]. Revenue Generation - The company has not generated any revenues to date and does not expect to do so until after the completion of its initial business combination [149].