Sales Performance - For the year ended December 31, 2023, the largest selling product categories were sofas (37%), jade mats (18%), and beds (13%) from continuing operations [39]. - Sales to North America accounted for 79.1% of total sales from continuing operations in 2023, down from 94.2% in 2022 [44]. - Revenues from Diamond Bar accounted for 82.4% of total sales from continuing operations in 2023, while Nova Malaysia's revenues accounted for 17.6% [59]. - Sales to North America accounted for 79.1% of total sales from continuing operations in 2023, down from 94.2% in 2022, indicating a shift towards diversifying international sales [59]. Business Operations - The company sold its entire jade mats inventory for 2.00 million in liquidation sales in June 2023, exiting the jade mats business due to the negative impact of COVID-19 from 2020 to 2022 [45]. - The company has 27 full-time employees worldwide as of December 31, 2023, with 24 in the U.S. and 3 in Malaysia [28]. - Approximately 36% of total purchases in 2023 were from two principal suppliers, highlighting the company's reliance on a limited number of suppliers [55]. Financial Actions - A 1-for-5 reverse stock split was executed on May 22, 2023, consolidating every 5 shares into one [26]. - The company increased its authorized shares from 3,000,000 to 250,000,000 on September 5, 2023 [27]. Strategic Focus - The company focuses on integrating new sources of distribution and manufacturing to expand its customer base and drive growth [24]. - The company aims to respond to changing market conditions and take advantage of upturns in global and local economies [44]. - The company has established long-term relationships with worldwide customers by providing high-quality, cost-effective sourcing solutions [25]. - The company plans to expand the "Diamond Sofa" brand and introduce new brands for direct sales in the U.S. and international markets [50]. - The company aims to increase direct sales to a broad range of retailers and chain stores across the U.S. and international markets [50]. Product Development - The company invested $3.12 million in research and development in 2023, focusing on developing Virtual and Augmented reality software and AI systems [66]. - The company has developed over 230 products exclusively for international markets, showcasing its commitment to product diversification [48]. - The company anticipates introducing new products under the "Diamond Sofa" brand on a quarterly basis for the U.S. market [65]. Shipping and Logistics - The company experienced significant delays in shipping from Asia due to the pandemic, but shipping and related costs returned to normal by June 2022 [56]. - The company markets its products through wholesale and retail channels, as well as various online platforms worldwide [22].
Nova LifeStyle(NVFY) - 2023 Q4 - Annual Report