Cheetah Net Supply Chain Service Inc. Announces Third Quarter 2024 Results and Provides Corporate Update
Rhea-AI Summary
Cheetah Net Supply Chain Service reported Q3 2024 results, showing significant revenue decline to $61,208 from $10.0 million in Q3 2023, primarily due to downturn in parallel-import vehicle business. The company relocated headquarters to Irvine, CA, completed a public offering raising $1.1 million, and implemented a 1-for-16 reverse stock split. The company is transitioning from parallel-import vehicles to logistics and warehousing operations. Q3 2024 resulted in a net loss of $1.8 million compared to net income of $0.1 million in Q3 2023. Cash position stands at $5.3 million with working capital of $11.6 million as of September 30, 2024.
Positive
- Strong liquidity position with $5.3 million cash and $11.6 million working capital
- Improved gross margin from 11.6% to 48.8% in Q3 2024
- Successfully raised $1.1 million through public offering
Negative
- Revenue declined 99.4% to $61,208 in Q3 2024 from $10.0 million in Q3 2023
- Net loss of $1.8 million in Q3 2024 compared to net income of $0.1 million in Q3 2023
- $1.1 million allowance for credit loss on aged accounts receivable
- General and administrative expenses increased 108% to $1.1 million
News Market Reaction
On the day this news was published, CTNT declined 4.86%, reflecting a moderate negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
IRVINE, Calif., Nov. 13, 2024 (GLOBE NEWSWIRE) -- Cheetah Net Supply Chain Service Inc. (“Cheetah” or the “Company”) (Nasdaq CM: CTNT), a provider of warehousing and logistics, today reported results for the quarter ended September 30, 2024 and provided a corporate update.
Recent Highlights*
- On July 23, 2024, the Company relocated its headquarters from Charlotte, NC to Irvine, CA, in order to implement its business model transformation, be closer to the important Southern California market, take advantage of the region’s well-developed infrastructure and logistics networks, capitalize on the area’s large consumer presence, and gain access to California’s skilled labor force.
- On July 26, 2024, the Company closed a public offering of 404,979 shares of its Class A common stock at an offering price of
$3.68 per share, pursuant to an effective registration statement on Form S-1 (SEC File No. 333-280743), which was filed with the U.S. Securities and Exchange Commission on July 10, 2024 and declared effective on July 15, 2024, generating net proceeds of$1.1 million after deducting underwriting discounts and other related expenses. The Company intends to use the net proceeds for working capital and general corporate purposes. - On August 16, 2024, the Company’s board of directors (the “Board”) approved the adoption of the Company’s Amended and Restated 2024 Stock Incentive Plan (the “Plan”). Subsequently, on September 30, 2024, the Company’s stockholders approved the Plan and the compensation committee of the Board granted stock awards of 118,750 shares of Class A common stock and 31,250 shares of Class B common stock. Share-based compensation expenses of
$261,666 were recognized during the quarter ended September 30, 2024. - At a special stockholders’ meeting held on September 30, 2024, the Company’s stockholders approved the Company’s Fourth Amended and Restated Articles of Incorporation to authorize a reverse stock split. Subsequently, on October 7, 2024, the Board approved the a reverse stock split of the Company’s common stock at a ratio of 1-for-16 (the “Reverse Stock Split”). The Reverse Stock Split took effect on October 21, 2024. Starting on October 24, 2024, the Company’s Class A common stock began trading on the Nasdaq Capital Market on a post-split basis.
*All share numbers are retrospectively adjusted for the Reverse Stock Split.
Tony Liu, Cheetah’s Chairman and CEO commented, “Since the second quarter of this year, the Company has been undergoing a business transformation from the previous parallel-import vehicle business, which had shrunk substantially due to the deteriorating Chinese macroeconomy conditions since the second half of 2022, to the logistics and warehousing business, which utilizes more the international trade flows between the PRC and U.S. markets. Additionally, our headquarters relocation to Irvine, CA will enable a stronger management focus on our new business line due to Irvine’s proximity to the important ports of Los Angeles and Long Beach. Management will continue to take initiatives to seek out new business opportunities. 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.”
Third Quarter 2024 Financial Results
During the third quarter of 2024, the Company generated
Gross profit from the combined business segments in the third quarter of 2024 decreased by approximately
General and administrative expenses were
Allowance of credit loss of accounts receivable was
Share-based compensation expenses was
Net loss was
Nine Months 2024 Financial Results
Revenues for the nine months ended September 30, 2024 were
Gross profit decreased by approximately
Selling expenses decreased to approximately
Allowance of credit loss of accounts receivable was
Share-based compensation expenses was
Interest expenses decreased by approximately
Net loss was
Liquidity and Cash Flow
As of September 30, 2024, the Company had cash and cash equivalents of
The Company also reported cash provided by operating activities of
The Company’s working capital cushion is supported by its financing activities and its ability to borrow under its existing credit facilities.
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
(949) 418 7804
ir@cheetah-net.com
| CHEETAH NET SUPPLY CHAIN SERVICE INC. UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| REVENUES | ||||||||||||||||
| Parallel-import Vehicles | $ | — | 10,038,246 | $ | 1,631,248 | 32,475,714 | ||||||||||
| Logistics and Warehousing | 61,208 | — | 231,605 | — | ||||||||||||
| Total Revenues | 61,208 | 10,038,246 | 1,862,853 | 32,475,714 | ||||||||||||
| COST OF REVENUES | ||||||||||||||||
| Cost of vehicles | — | 8,365,730 | 1,515,270 | 27,190,224 | ||||||||||||
| Fulfillment expenses | — | 505,156 | 140,798 | 1,722,704 | ||||||||||||
| Ocean freight service cost | 31,339 | — | 119,437 | — | ||||||||||||
| Total cost of revenues | 31,339 | 8,870,886 | 1,775,505 | 28,912,928 | ||||||||||||
| GROSS PROFIT | 29,869 | 1,167,360 | 87,348 | 3,562,786 | ||||||||||||
| OPERATING EXPENSES | ||||||||||||||||
| Selling expenses | 19,557 | 184,061 | 117,819 | 603,184 | ||||||||||||
| General and administrative expenses | 1,102,454 | 530,089 | 2,735,450 | 1,676,559 | ||||||||||||
| Allowance of credit loss of accounts receivable | 1,095,094 | — | 1,095,094 | — | ||||||||||||
| Share-based compensation expenses | 261,666 | — | 261,666 | — | ||||||||||||
| Total operating expenses | 2,478,771 | 714,150 | 4,210,029 | 2,279,743 | ||||||||||||
| (LOSS) INCOME FROM OPERATIONS | (2,448,902 | ) | 453,210 | (4,122,681 | ) | 1,283,043 | ||||||||||
| OTHER INCOME (EXPENSES) | ||||||||||||||||
| Interest income | 88,459 | 107 | 145,631 | 4,009 | ||||||||||||
| Interest expenses | (14,865 | ) | (286,197 | ) | (113,830 | ) | (1,058,111 | ) | ||||||||
| Other income | 36 | — | 809 | — | ||||||||||||
| OTHER INCOME (EXPENSES), NET | 73,630 | (286,090 | ) | 32,610 | (1,054,102 | ) | ||||||||||
| (LOSS) INCOME BEFORE PROVISION FOR INCOME TAXES | (2,375,272 | ) | 167,120 | (4,090,071 | ) | 228,941 | ||||||||||
| Income tax (benefits) provision | (559,980 | ) | 44,217 | (1,052,969 | ) | 58,226 | ||||||||||
| NET (LOSS) INCOME | $ | (1,815,292 | ) | $ | 122,903 | $ | (3,037,102 | ) | $ | 170,715 | ||||||
| (Loss) Earnings per share - basic and diluted* | $ | (1.06 | ) | $ | 0.11 | $ | (1.78 | ) | $ | 0.16 | ||||||
| Weighted average shares - basic and diluted* | 1,709,610 | 1,091,727 | 1,709,610 | 1,058,509 | ||||||||||||
* Retrospectively adjusted for the Reverse Stock Split.
| CHEETAH NET SUPPLY CHAIN SERVICE INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS DATA | ||||||
| September 30, | December 31, | |||||
| 2024 | 2023 | |||||
| ASSETS | (Unaudited) | |||||
| CURRENT ASSETS: | ||||||
| Cash and cash equivalents | $ | 5,287,376 | $ | 432,998 | ||
| Accounts receivable, net | 3,291,450 | 6,494,695 | ||||
| Loans receivable | 3,058,295 | 672,500 | ||||
| Inventory | — | 1,515,270 | ||||
| TOTAL CURRENT ASSETS | 12,418,881 | 9,820,537 | ||||
| TOTAL ASSETS | $ | 16,828,155 | $ | 10,059,265 | ||
| TOTAL CURRENT LIABILITIES | 835,885 | 2,358,791 | ||||
| TOTAL LIABILITIES | 2,874,412 | 3,154,637 | ||||
| TOTAL STOCKHOLDERS’ EQUITY* | 13,953,743 | 6,904,628 | ||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY* | $ | 16,828,155 | $ | 10,059,265 | ||
* Retrospectively adjusted for the Reverse Stock Split
| CHEETAH NET SUPPLY CHAIN SERVICE INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| For the Nine Months Ended | ||||||||||||||
| September 30, | ||||||||||||||
| 2024 | 2023 | |||||||||||||
| Cash flows from operating activities: | ||||||||||||||
| Net (loss) income | $ | (3,037,102 | ) | $ | 170,715 | |||||||||
| Net cash provided by operating activities | 601,526 | 2,871,734 | ||||||||||||
| Cash flows from investing activities: | ||||||||||||||
| Net cash used in investing activities | (2,970,912 | ) | — | |||||||||||
| Cash flows from financing activities: | ||||||||||||||
| Net cash provided by (used in) financing activities | 7,223,764 | (2,225,246 | ) | |||||||||||
| Net increase in cash | 4,854,378 | 646,488 | ||||||||||||
| Cash, beginning of the period | 432,998 | 58,381 | ||||||||||||
| Cash, end of the period | $ | 5,287,376 | $ | 704,869 | ||||||||||
FAQ
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