CGA(CGA) - 2024 Q1 - Quarterly Report

Sales Performance - For the three months ended September 30, 2023, total net sales were $22,397,862, a decrease of$5,199,463 or 18.8% from $27,597,325 for the same period in 2022[135]. - Jinong's net sales decreased by$2,859,244 or 23.5% to $9,288,758, with sales volume dropping to approximately 8,036 metric tons, a decrease of 1,349 tons or 14.4$10,421,274, a decrease of $2,157,548 or 17.2$2,342,716, a decrease of $527,785 or 18.4$17,748,008, a decrease of $4,664,508 or 20.8$534,955, or 10.3%, to $4,649,854, compared to$5,184,809 in Q3 2022, with a gross profit margin of 20.8%[140]. - Jinong's gross profit decreased by $705,688, or 20.8$2,682,144 in Q3 2023, with a gross profit margin of approximately 28.9%[140]. - Gufeng's gross profit increased by $102,008, or 7.7$1,425,953 in Q3 2023, with a gross profit margin of approximately 13.7%[141]. Expenses and Losses - General and administrative expenses for Q3 2023 were $4,556,606, an increase of$1,271,491, or 38.7%, from $3,285,115 in Q3 2022[144]. - The net loss for the three months ended September 30, 2023, was$1,784,193, compared to a net loss of $528,114 for the same period in 2022, representing an increase of 237.8$(1,784,193), an increase in loss of $1,256,078, or 237.8$(528,114) in Q3 2022[146]. Cash Flow and Financial Position - Cash and cash equivalents as of September 30, 2023, were $67,285,823, a decrease of$3,856,365, or 5.4%, from $71,142,188 as of June 30, 2023[150]. - Net cash used in operating activities was$626,510 for Q3 2023, a decrease of $2,369,000, or 79.1$2,995,510 in Q3 2022[153]. - Accounts receivable increased by $3,452,398, or 21.0$19,908,132 as of September 30, 2023, compared to $16,455,734 as of June 30, 2023[156]. - The allowance for doubtful accounts decreased by$3,794,917, or 6.9%, to $50,913,569 as of September 30, 2023[156]. - As of September 30, 2023, total short-term loans payable decreased to$3,756,540 from $5,346,640 as of June 30, 2023, a reduction of 29.6$3,859,578, or 8.3%, to $42,595,553 as of September 30, 2023, primarily due to a significant reduction in Gufeng's inventory, which fell by 18.3$352,370, or 2.5%, to $14,685,085 as of September 30, 2023, indicating a potential increase in production activity[160]. - Accounts payable decreased by$120,955, or 5.8%, to $1,979,494 as of September 30, 2023, reflecting improved cash flow management[161]. - Customer deposits (unearned revenue) increased by$179,290, or 3.3%, to $5,669,071 as of September 30, 2023, driven by seasonal fluctuations in demand[161]. Other Financial Metrics - The company reported an accumulated other comprehensive loss of$28 million as of September 30, 2023, due to foreign exchange fluctuations[174]. - Short-term debt outstanding decreased from $5.3 million to$3.8 million between June 30, 2023, and September 30, 2023, indicating a reduction in leverage[175]. - The company has not entered any hedging transactions to mitigate foreign exchange or interest rate risks, exposing it to potential volatility[174][176]. - The impact of COVID-19 has led to increased credit risk, with higher overdue accounts receivable compared to pre-pandemic levels[177]. - Inflationary pressures have adversely affected operating results, with increased costs impacting gross margins and administrative expenses[178].