Cheetah Net Supply Chain Service Inc. Announces Second Quarter 2024 Results and Provides Corporate Update
Rhea-AI Summary
Cheetah Net Supply Chain Service Inc. (Nasdaq CM: CTNT) reported challenging Q2 2024 results due to continued adverse market conditions in the PRC. Key points include:
- Revenue declined significantly to $0.3 million from $12.2 million in Q2 2023
- Net loss of $0.6 million compared to $0.2 million income in Q2 2023
- Vehicle sales dropped to 1 unit from 93 in Q2 2023
- Company is pivoting towards integrated international trade services
- Generated $70,000+ in non-vehicle warehousing and logistics revenue
- Announced planned headquarters move from Charlotte, NC to Irvine, CA
The company aims to refocus on logistics and warehouse operations to address the declining parallel-import vehicle market. Management expects tangible results may take several quarters but is confident in future growth potential.
Positive
- Generated over $70,000 in non-vehicle warehousing and logistics revenue
- Reported cash of $6.3 million as of June 30, 2024
- Working capital amounted to approximately $12.4 million
Negative
- Revenue declined 97.5% to $0.3 million from $12.2 million in Q2 2023
- Net loss of $0.6 million compared to $0.2 million income in Q2 2023
- Vehicle sales dropped to 1 unit from 93 in Q2 2023, a 98.9% decrease
- Cost of revenue from parallel-import vehicles sold amounted to 107.8% of parallel-import vehicle revenue in Q2 2024
News Market Reaction
On the day this news was published, CTNT declined 12.17%, reflecting a significant negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
CHARLOTTE, N.C., Aug. 13, 2024 (GLOBE NEWSWIRE) -- Cheetah Net Supply Chain Service Inc. (“Cheetah” or “the Company”) (Nasdaq CM: CTNT), a provider of warehousing and logistics services and a seller of parallel-import vehicles sourced from the U.S. market and sold into the People’s Republic of China (the “PRC”), today reported results for the quarter ended June 30, 2024 and provided a corporate update.
Recent Highlights
- Challenging market conditions in the PRC, first reported with respect to the Company’s financial performance during the second half of 2023, have continued into 2024. The Company’s three- and six- month financial results were impacted by these unfavorable market conditions, resulting in a significant decline in revenue. Adverse market conditions continue to severely depress or eliminate the margin between U.S. retail prices of select luxury car models and their wholesale prices in the parallel-vehicle market.
- The Company sold one vehicle during the second quarter of 2024, compared with 93 vehicles for the same period in 2023. The vehicle sales revenue for the second quarter of 2024 amounted to
$0.2 million compared with$12.2 million for the same period in 2023. The decline in revenue resulted in a net loss of$0.6 million during the second quarter of 2024 compared with income of$0.2 million during the second quarter of 2023. - The Company is moving beyond the parallel-import vehicle business with the goal of becoming an integrated provider of international trade services and financing for small- and medium-sized traders. The Company generated more than
$70,000 in warehousing and logistics revenue from non-vehicle-related wholesalers during the second quarter of 2024 following the acquisition of Edward Transit Express Group Inc. in February 2024. - In June 2024, the Company announced its planned headquarters move from Charlotte, NC to Irvine, CA to be closer to the important Southern California market, take advantage of well-developed infrastructure and logistics networks that already exist in the region, capitalize on the area’s large consumer presence, and gain access to California’s skilled labor force.
Tony Liu, Cheetah’s Chairman and CEO commented, “The parallel-vehicle import market has continued to be significantly affected by the adverse market conditions resulting from significant price discounting by luxury import brands, and a shift in consumer interest to domestic EVs. In response, we are accelerating our efforts to grow our logistics and warehouse operations. Beginning in the second quarter, we are increasing our marketing staff to seek out new business opportunities and help concentrate our efforts on international trade flows between the PRC and U.S. markets. In addition, we recently announced our planned headquarters move from Charlotte, NC to Irvine, CA, which we believe will help intensify management focus on our logistics and warehouse business given its proximity to the important ports of Los Angeles and Long Beach. While we believe that tangible results of these efforts may not be apparent for several quarters, we have confidence that we are positioning the Company for substantial future growth in this business.”
Second Quarter 2024 Financial Results
Revenues for the quarter were
Total cost of revenue from parallel-import vehicles sold decreased by approximately
The Company reported total revenue of approximately
Selling expenses decreased significantly to approximately
Net loss was
Six Months 2024 Financial Results
Revenues for the first half of 2024 were
Total cost of revenue from parallel-import vehicles sold was
The Company reported total revenue of approximately
Selling expenses were
Net loss was
Liquidity and Cash Flow
The Company reported cash of
The Company is working to further improve its liquidity and capital sources primarily by generating cash from operations, debt financing, and, if needed, financial support from its principal stockholder. If necessary to fully implement its business plan and sustain continued growth, the Company may seek additional equity financing from outside investors. Based on the current operating plan, management believes that the aforementioned measures collectively will provide sufficient liquidity to meet the Company’s future liquidity and capital requirements for at least 12 months from the issuance date of its consolidated financial statements.
Forward-Looking Statements
This press release contains certain forward-looking statements, including statements that are predictive in nature. Forward-looking statements are based on the Company’s current expectations and assumptions. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. These statements may be identified by the use of forward-looking expressions, including, but not limited to, “anticipate,” “believe,” “continue,” “estimate,” “expect,” “future,” “intend,” “may,” “outlook,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would,” and similar expressions that predict or indicate future events or trends or that are not statements of historical matters, but the absence of these words does not mean that a statement is not forward-looking. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Important factors that could cause actual results to differ materially from those in the forward-looking statements are set forth in the Company’s filings with the U.S. Securities and Exchange Commission, including its registration statement on Form S-1, as amended, under the caption “Risk Factors.”
For more information, please contact:
Cheetah Net Supply Chain Service Inc.
Investor Relations
(704) 826-7280
ir@cheetah-net.com
| CHEETAH NET SUPPLY CHAIN SERVICE INC. | |||||||||||||||
| UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| REVENUES | |||||||||||||||
| Parallel-import Vehicles | $ | 200,297 | 12,223,026 | $ | 1,631,248 | 22,437,468 | |||||||||
| Logistics and Warehousing | 93,563 | — | 170,397 | — | |||||||||||
| Total Revenues | 293,860 | 12,223,026 | 1,801,645 | 22,437,468 | |||||||||||
| COST OF REVENUES | |||||||||||||||
| Cost of vehicles | 200,297 | 10,319,991 | 1,515,270 | 18,824,494 | |||||||||||
| Fulfillment expenses | 15,537 | 650,666 | 140,798 | 1,217,548 | |||||||||||
| Ocean freight service cost | 45,598 | — | 88,098 | — | |||||||||||
| Total cost of revenues | 261,432 | 10,970,657 | 1,744,166 | 20,042,042 | |||||||||||
| GROSS PROFIT | 32,428 | 1,252,369 | 57,479 | 2,395,426 | |||||||||||
| OPERATING EXPENSES | |||||||||||||||
| Selling expenses | 19,422 | 141,340 | 98,262 | 419,123 | |||||||||||
| General and administrative expenses | 865,354 | 565,400 | 1,632,996 | 1,146,470 | |||||||||||
| Total operating expenses | 884,776 | 706,740 | 1,731,258 | 1,565,593 | |||||||||||
| (LOSS) INCOME FROM OPERATIONS | (852,348 | ) | 545,629 | (1,673,779 | ) | 829,833 | |||||||||
| OTHER (EXPENSE) INCOME | |||||||||||||||
| Interest expense, net | (36,200 | ) | (334,855 | ) | (98,965 | ) | (771,914 | ) | |||||||
| Other income, net | 28,393 | 1,968 | 57,945 | 3,902 | |||||||||||
| Total other expense, net | (7,807 | ) | (332,887 | ) | (41,020 | ) | (768,012 | ) | |||||||
| (LOSS) INCOME BEFORE PROVISION FOR INCOME TAXES | (860,155 | ) | 212,742 | (1,714,799 | ) | 61,821 | |||||||||
| Income tax (benefit) provision | (247,275 | ) | 56,997 | (492,989 | ) | 14,009 | |||||||||
| NET (LOSS) INCOME | $ | (612,880 | ) | $ | 155,745 | $ | (1,221,810 | ) | $ | 47,812 | |||||
| (Loss) Earnings per share - basic and diluted | $ | (0.03 | ) | $ | 0.01 | $ | (0.05 | ) | $ | 0.00 | |||||
| Weighted average shares - basic and diluted | 22,375,996 | 16,666,000 | 22,375,996 | 16,666,000 | |||||||||||
| CHEETAH NET SUPPLY CHAIN SERVICE INC. | |||||
| UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET DATA | |||||
| June 30, | December 31, | ||||
| 2024 | 2023 | ||||
| ASSETS | |||||
| CURRENT ASSETS: | |||||
| Cash and cash equivalents | $ | 6,292,901 | $ | 432,998 | |
| Accounts receivable | 5,128,119 | 6,494,695 | |||
| Inventories | — | 1,515,270 | |||
| TOTAL CURRENT ASSETS | 13,621,717 | 9,820,537 | |||
| TOTAL ASSETS | $ | 16,275,899 | $ | 10,059,265 | |
| TOTAL CURRENT LIABILITIES | 1,240,967 | 2,358,791 | |||
| TOTAL LIABILITIES | 2,462,086 | 3,154,637 | |||
| TOTAL STOCKHOLDERS’ EQUITY | 13,813,813 | 6,904,628 | |||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 16,275,899 | $ | 10,059,265 | |
| CHEETAH NET SUPPLY CHAIN SERVICE INC. | |||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||
| For the Six Months Ended | |||||||||
| June 30, | |||||||||
| 2024 | 2023 | ||||||||
| Cash flows from operating activities: | |||||||||
| Net (loss) income | $ | (1,221,810 | ) | $ | 47,812 | ||||
| Net cash provided by operating activities | 827,980 | 4,145,363 | |||||||
| Cash flows from investing activities: | |||||||||
| Net cash used in investing activities | (912,617 | ) | — | ||||||
| Cash flows from financing activities: | |||||||||
| Net cash provided by (used in) financing activities | 5,944,540 | (3,611,618 | ) | ||||||
| Net increase in cash | 5,859,903 | 533,745 | |||||||
| Cash, beginning of the period | 432,998 | 58,381 | |||||||
| Cash, end of the period | $ | 6,292,901 | $ | 592,126 | |||||
FAQ
What were Cheetah Net Supply Chain Service's (CTNT) Q2 2024 financial results?
How many vehicles did Cheetah Net Supply Chain Service (CTNT) sell in Q2 2024?
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How much non-vehicle related revenue did Cheetah Net Supply Chain Service (CTNT) generate in Q2 2024?
