Blue Star(US:BSFC)2021-05-16 16:00Revenue and Profitability - Revenue for the three months ended March 31, 2021 decreased 45.6% to $2,485,891 compared to $4,571,614 for the same period in 2020 due to the impact of the COVID-19 pandemic [93]. - Gross profit margin for the three months ended March 31, 2021 decreased to $302,779 compared to $423,216 for the same period in 2020, directly attributable to reduced overall revenue [94]. - Net loss for the three months ended March 31, 2021 was $478,104, a decrease from a net loss of $853,647 for the same period in 2020, primarily due to reductions in salaries, wages, interest, and other expenses [102]. Costs and Expenses - Cost of goods sold for the three months ended March 31, 2021 decreased to $2,183,112 from $4,148,398 in the same period of 2020, reflecting the revenue decline [94]. - Other operating expenses decreased by 28.9% to $317,398 for the three months ended March 31, 2021 from $446,433 for the same period in 2020, reflecting overhead reduction efforts [98]. - Interest expense decreased to $110,534 for the three months ended March 31, 2021 from $276,655 for the same period in 2020, due to a reduction in loans outstanding [101]. Cash Flow and Financing - Cash provided by operating activities during the three months ended March 31, 2021 was $462,624, down from $1,857,853 for the same period in 2020, mainly due to reductions in inventory and other current assets [106]. - Cash utilized in financing activities for the three months ended March 31, 2021 was $653,675, down from $1,998,594 for the same period in 2020, due to reduced loan payments [108]. - The Company issued a four-month unsecured promissory note of $100,000 to Lobo Holdings, bearing an interest rate of 18% per annum [118]. Loans and Financial Assistance - On March 2, 2021, the Company received $371,944 from a Paycheck Protection Program Loan, with a 1.0% interest rate and a five-year maturity [120]. - The PPP Loan is fully guaranteed by the SBA and may be forgiven if certain criteria are met [120]. - Monthly payments of approximately $8,500 for the PPP Loan are expected to begin on June 2, 2022 [120]. Other Financial Information - The company had cash of $146,636 as of March 31, 2021, with a working capital deficit of $2,581,653, including $1,299,712 in subordinated stockholder loans [103]. - The Company currently has no off-balance sheet arrangements [121]. - The Company is classified as a smaller reporting company and is not required to provide certain market risk disclosures [122].