Year-to-Date 2024 Revenue Increases 20.8% YoY
to $91.2 Million
New Production, Product and Sales Initiatives
Driving Motor Vehicle Growth
GARLAND,
Texas, Nov. 15, 2024 /PRNewswire/ -- Massimo
Group (NASDAQ: MAMO) ("Massimo"), a manufacturer and
distributor of powersports vehicles and pontoon boats, has reported
its financial and operational results for the third quarter ended
September 30, 2024.
Key Financial Q3 2024 and Subsequent Operational Highlights
and Business Updates
($ millions)
|
Nine Month
Comparison
|
|
Q3
Comparison
|
|
9M
2024
|
9M
2023
|
$ Change
YoY
|
% Change
YoY
|
|
Q3
2024
|
Q3
2023
|
$ Change
YoY
|
% Change
YoY
|
Revenue
|
$91.2
|
$75.5
|
$15.7
|
20.8 %
|
|
$25.6
|
$29.9
|
($4.3)
|
(14.4 %)
|
Gross Profit
|
$28.9
|
$23.8
|
$5.1
|
21.6 %
|
|
$7.0
|
$10.1
|
($3.1)
|
(30.9 %)
|
Gross
Margin
|
31.7 %
|
31.5 %
|
21
bps
|
|
|
27.2 %
|
33.6 %
|
(647)
bps
|
|
Net Income
|
$3.5
|
$6.6
|
($3.1)
|
(46.9 %)
|
|
($2.5)
|
$4.0
|
($6.5)
|
(163.2 %)
|
- 9M 2024 revenue increased 20.8%
to $91.2 million compared to
$75.5 million in 9M 2023.
- 9M 2024 gross profit increased
21.6% to $28.9 million from
$23.8 million in 9M 2023. Gross margin increased 21 basis points
to 31.7% in 9M 2024 from 31.5% in
9M 2023.
- 9M 2024 net income decreased
46.9% to $3.5 million, or
$0.09 per basic and diluted share, as
compared to net income of $6.6
million, or $0.16 per basic
and diluted share, in 9M 2023.
- Q3 2024 revenue decreased 14.4% to $25.6
million compared to $29.9
million in Q3 2023.
- Q3 2024 gross profit decreased 30.9% to $7.0 million from $10.1
million in Q3 2023. Gross margin decreased 647 basis points
to 27.2% in Q3 2024 from 33.6% in Q3 2023.
- Q3 2024 net income decreased 163.2% to a loss ($2.5) million, or ($0.06) per basic and diluted share, as compared
to net income of $4.0 million, or
$0.10 per basic and diluted share, in
Q3 2023.
- New vehicle launches included:
- T-Boss UTV series for the winter season with cab enclosure
built to deliver complete protection from the elements.
- T-Boss 1000 UTV, the best equipped and most value-packed UTV in
its class with a perfect blend of utility, performance and
capability.
- GKD 350 All-Terrain Go Kart, combining iconic styling with
powerful performance in a rugged two-seater go-kart perfect for
conquering any terrain.
- Exhibited Massimo Motor vehicles at the Equip Exposition,
Mid-States Fall Rendezvous 2024, and Outdoor Power Equipment
Hoedown for Mid-States Distributing Company, Inc.
- Announced the adoption of a new automated vehicle assembly
robot line to be installed in the third calendar quarter at its
376,000 square foot factory in Garland,
Texas to support production of its ATV and UTV vehicles
lines.
Management Commentary
"During the third quarter we continued to leverage new product
innovation and a strong customer base to drive our strategic
business expansion and growth prospects, and solidify our brand's
position in key markets," said David
Shan, Founder, Chairman & CEO. "The third quarter was
marked by industry-wide challenges and pressure on Pontoon boat
sales, countered by expansions in motor vehicle production,
distribution and products that are supporting revenue momentum. An
ongoing cadence of new vehicle launches and marketing efforts
across the country are driving adoption from new distribution
partners and retailers to expand our national footprint. Following
the conservatism principle in accounting, we adopted a cautious
approach and recorded a one-time charge of approximately
$3.6 million in the third quarter due
to ongoing litigation, which is currently under appeal. Should
there be any favorable ruling in the future, it will result in
gains reversing the charge we took in this period. Without this
charge the net income for the quarter would have been positive.
"In the last several months we have launched several exciting
new vehicles and vehicle series as we continue to invest in our
R&D to further enhance our products, using advanced technology
to offer our UTV customers a smoother and more comfortable ride. We
launched a new feature-rich T-Boss 1000 UTV for those who are
looking for a powerful and versatile UTV that can handle any trip,
with some specific features that make it a great choice for
ranchers, hunters and more. A new series of T-Boss UTVs is equipped
with Cab Enclosure that is built to deliver complete protection
from the elements. Made with durable tempered glass, this fully
enclosed cabin shields passengers from rain, wind, and snow,
providing a comfortable environment for all outdoor tasks. Finally,
we introduced the new GKD 350 All-Terrain Go Kart, our new rugged
two-seater go-kart perfect for conquering any terrain. Built tough
with standard safety features, the GKD 350 delivers both endless
fun and a utility-driven experience with a 300cc power plant, 25
inch all terrain tires and easy-to-drive automatic transmission. We
are now ramping sales of these new products through our sales
network nationwide.
"To support these new products and our full lineup of rugged,
versatile vehicles, we showcased our vehicles to hundreds of
thousands of potential customers at several flagship expos and
events around the country. We engaged with several potential new
dealers, discussing opportunities that could enhance our
distribution network and increase market penetration. These events
also serve as an excellent opportunity for us to engage with store
partners and discuss potential collaborations, which we believe
lays the foundation for future revenue growth.
"Several production initiatives during the quarter are
positioning us to further expand output levels each month. A new
expansion has added 90,000 sq. ft. to our manufacturing facility in
Garland, Texas to support
increased production across motor and marine product verticals. At
this facility we are also launching a new automated vehicle
assembly robot line that are being installed as expected. This
automation is expected to improve efficiency by 50% and enhance
safety for production of ATV and UTV vehicles lines.
"Looking ahead, we are committed to delivering value as we scale
operations and broaden our reach in domestic and international
markets. We continue to build manufacturing capacity aimed at
enhancing flexibility and increasing annual production, including
an automated vehicle assembly robot line and the Armlogi
partnership, which are expected to allow us to meet the growing
demand of our products. We believe with increased operating
efficiencies we can further improve margins while continuing to
grow our revenue and expand our product line with new models. We
are focusing on driving sales across our existing and new
diversified product portfolio. With positive feedback on our new
vehicles, we are confident in the growth prospects for the first
half of 2025 as the introduction of new products and distribution
relationships is expected to present significant opportunities for
us to build market share and deliver long-term value to our
shareholders," concluded Mr. Shan.
Third Quarter 2024 Financial Results
For the three months ended September 30,
2024, revenues decreased by $4.3
million, or 14.4%, to $25.6
million, compared to $29.9
million in the prior year period. The decrease in revenue
was primarily due to a significant drop in Pontoon boat sales, and
a slight decrease in sales of UTV, ATV and e-bikes.
Revenue from sales of UTVs, ATVs and e-bikes decreased by
$1.9 million, or 6.9%, from
$27.0 million in the third quarter of
fiscal 2023, to $25.1 million in the
third quarter of fiscal 2024. The decrease in revenue was partially
driven by the slow industry-wide trend, and partially by the
seasonal promotions we offered in the third quarter of fiscal
2024.
Revenue from sales of Pontoon Boats decreased by $2.4 million, or 82.5%, from $3.0 million in the third quarter of fiscal 2023,
to $0.5 million in the third quarter
of fiscal 2024. The decrease in revenue was primarily attributable
to the significant industry-wide downturn due to the impact of the
high interest rates and inflation as demonstrated in the high
rejection rates dealers have encountered from floorplan financing
providers such as Northpoint. This trend aligns with the
industry-wide challenges that intensified in the third quarter of
fiscal 2024. Additionally, economic uncertainty in the U.S. has led
to reduced spending on luxury boats, further constraining our
Pontoon Boat sales.
Gross profit decreased by $3.1
million, or 30.9%, from $10.1
million in the third quarter of fiscal 2023, to $7.0 million in the third quarter of fiscal 2024.
The gross profit margin was 27.2% in the third quarter of fiscal
2024, compared with 33.6% in the same period last year. The
decrease of 6.5% in the gross profit margin is consistent with (i)
reduced sale prices aimed at clearing slow-moving inventory, and
(ii) the decline in sales of Pontoon Boats, without a corresponding
reduction in fixed overhead costs, such as rent and salaries.
The cost of revenue on UTVs, ATVs and e-bikes increased by
$0.6 million, or 3.7%, from
$17.5 million in the third quarter of
fiscal 2023 to $18.1 million in the
third quarter of fiscal 2024, and gross profit decreased by
$2.5 million, or 26.5%, from
$9.4 million in the third quarter of
fiscal 2023 to $6.9 million in the
third quarter of fiscal 2024. The gross margin decreased by 7.4%,
from 35.1% in the third quarter of fiscal 2023 to 27.7% in the
third quarter of fiscal 2024. The increase in the cost of revenue
was largely due to higher overhead costs, mainly from research and
design input and the additional rent expense as we expand our
warehouse space in fiscal 2024. The slight decrease in gross margin
was primarily a result of selling some inventory at lower price at
our seasonal promotions in the third quarter of fiscal 2024.
The cost of revenue on Pontoon Boats decreased by $1.9 million, or 78.3%, from $2.4 million in the third quarter of fiscal 2023
to $0.5 million in the third quarter
of fiscal 2024, and gross profit decreased by $0.6 million, or 98.9%, from $0.6 million in the third quarter of fiscal 2023
to $6,619 in the third quarter of
fiscal 2024. The gross margin decreased by 19.1%, from 20.4% in the
third quarter of fiscal 2023 to 1.3% in the third quarter of fiscal
2024. The decrease in gross margin was primarily a result of a
decline in sales of Pontoon Boats, without a corresponding
reduction in fixed overhead costs, such as rent, utilities, and
salaries.
Selling expenses increased by $0.5
million, or 24.9%, from $2.1
million in the third quarter of fiscal 2023 to $2.6 million in the third quarter of fiscal 2024.
The increase in selling expenses was mainly due to an increase in
shipping and handling fees. The increase was partly offset by a
decrease in warranty expense of approximately $0.4 million, due to enhanced quality control and
customer service measures. The adoption of a traveling technician
team has enabled timely responses to customer requests, reducing
repair costs.
General and administrative expenses increased by $1.2 million, or 43.4%, from $2.7 million in the third quarter of fiscal 2023
to $3.9 million in the third quarter
of fiscal 2024. The increase was mainly due to increased salaries
and benefits, travel expense and rent expense.
Total operating expenses increased 37.9% to $6.6 million for the three months ended
September 30, 2024, compared to
$4.8 million in the prior year third
quarter.
Net loss for the three months ended September 30, 2024, was ($2.5) million, or ($0.06) per basic and diluted share, as compared
to net income of $4.0 million, or
$0.10 per basic and diluted share, in
the three months ended September 30,
2023. Without the one-time charge of approximately
$3.6 million due to litigation, net
income for the quarter would have been positive.
Nine Months 2024 Financial Results
Revenues increased by $15.7
million, or 20.8%, from $75.5
million for the nine months ended September 30, 2023, to $91.2 million for the nine months ended
September 30, 2024. The increase in
revenue was primarily due to combined effects of rising demand in
the U.S. ATV and UTV market and our modified sales strategy. In
2024, we continued to expand our distribution network with various
retailers to increase our products' market penetration. We
strategically focused our efforts on large retail stores in the
U.S. (the "big box stores") that offer their own financing plans,
while moving away from retailers that have liberal return
policies.
Revenue from sales of UTVs, ATVs and e-bikes increased by
$22.2 million, or 33.8%, from
$65.8 million for the nine months
ended September 30, 2023 to
$88.0 million for the nine months
ended September 30, 2024. The
increase in revenue was primarily attributed to the expansion into
more big box stores. This surge is consistent with the increasing
ranch/farm-work utilization of UTVs across the 1.89 million farms
in the U.S. with an average size of 464 acres and the new
customer's rural lifestyle focus. The increase in sales is also due
to a shift in our sales strategy, focusing mostly on in-store sales
to this retail chain store customer, which generally involve larger
volumes and no returns. In addition, sales to this new customer
consist of high-turnover inventory products that are of high
quality and have a strong customer reputation. This enhances the
efficiency of our capital utilization.
Revenue from sales of Pontoon Boats decreased by $6.6 million, or 67.6%, from $9.7 million for the nine months ended
September 30, 2023 to $3.1 million for the nine months ended
September 30, 2024. The revenue
decrease was primarily due to an industry-wide downturn driven by
high interest rates and inflation, which are impacting the
consumption of non-essential goods. In addition, the fact that the
dealers have experienced high rejection rates at the floorplan
financing providers such as Northpoint has directly affected the
inventory level the dealers maintain and therefore our sales in
this category. This is consistent with the industry-wide trend. The
challenging economic environment and economic uncertainty in the
U.S. has led to reduced spending on luxury boats directly impacting
the sales of luxury boats such as our yacht.
Gross profit increased by $5.1
million, or 21.6%, from $23.8
million for the nine months ended September 30, 2023 to $28.9 million for the nine months ended
September 30, 2024. Gross margin was
31.7% for the nine months ended September
30, 2024, compared with 31.5% in the same period last year.
Our gross margin for the nine months ended September 30, 2024 remained constant when
compared with the same period in 2023.
Cost of revenue on UTVs, ATVs and e-bikes increased by
$16.1 million, or 36.9%, from
$43.5 million for the nine months
ended September 30, 2023, to
$59.6 million for the nine months
ended September 30, 2024 and gross
profit increased by $6.2 million, or
27.9%, from $22.2 million for the
nine months ended September 30, 2023,
to $28.4 million for the nine months
ended September 30, 2024. Gross
margin slightly decreased by 1.5%, from 33.8% for the nine months
ended September 30, 2023 to 32.3% for
the nine months ended September 30,
2024. The increase in the cost of revenue was in line with
the increase in sales. The slight decrease in gross profit margin
was mainly due to reduced sales prices to clear out slow-moving
inventory in the recent quarter.
Cost of revenue on Pontoon Boats decreased by $5.5 million, or 67.5%, from $8.2 million for the nine months ended
September 30, 2023, to $2.7 million for the nine months ended
September 30, 2024, and gross profit
decreased by $1.1 million, or 68.5%,
from $1.6 million for the nine months
ended September 30, 2023, to
$0.5 million for the nine months
ended September 30, 2024. Gross
margin decreased by 0.4%, from 16.0% for the nine months ended
September 30, 2023, to 15.6% for the
nine months ended September 30, 2024.
Our gross margin for the nine months ended September 30, 2024 remained constant compared to
the nine months ended September 30,
2023.
Selling expenses increased by $1.4
million, or 21.3%, from $6.5
million for the nine months ended September 30, 2023, to $7.9 million for the nine months ended
September 30, 2024, representing 8.7%
and 8.7% of total revenue in both periods. The increase was mainly
due to higher shipping and handling fees, partly offset by a
reduction in warranty expense of approximately $0.5 million, due to enhanced quality control and
customer service.
General and administrative expenses increased by $3.1 million, or 33.8%, from $9.0 million for the nine months ended
September 30, 2023, to $12.1 million for the nine months ended
September 30, 2024. The increase was
mainly due to higher rent expense, salaries and benefit, and
insurance expense.
Total operating expenses increased 35.2% to $21.1 million for the nine months ended
September 30, 2024, compared to
$15.6 million in the prior year
period.
Net income for the nine months ended September 30, 2024, was $3.5 million, or $0.09 per basic and diluted share, as compared to
net income of $6.6 million, or
$0.16 per basic and diluted share, in
the nine months ended September 30,
2023.
Cash and cash equivalents totaled $1.7
million at September 30, 2024,
as compared to $1.2 million at
September 30, 2023.
Net cash used in operating activities was approximately
$2.4 million during the nine months
ended September 30, 2024, compared to
net cash provided by operating activities of approximately
$5.8 million during the nine months
ended September 30, 2023,
representing an increase in the net cash used in operating
activities of $8.2 million during the
nine months ended September 30, 2024
compared with the same period in 2023. This is consistent with the
Company using part of the IPO proceeds as working capital to grow
sales.
About Massimo Group
Massimo Group (NASDAQ: MAMO) is a manufacturer and distributor
of powersports vehicles and pontoon boats. Founded in 2009, Massimo
Motor believes it offers some of the most value packed UTV's,
off-road, and on-road vehicles in the industry. The company's
product lines include a wide selection of farm and ranch tested
utility UTVs, recreational ATVs, and Americana style mini-bikes.
Massimo Marine manufacturers and
sells Pontoon and Tritoon boats with a dedication to innovative
design, quality craftsmanship, and great customer service. Massimo
is also developing electric versions of UTVs, golf-carts and
pontoon boats. The company's 376,000 square foot factory is in the
heart of the Dallas / Fort Worth
area of Texas in the city of
Garland. For more information,
visit massimomotor.com, massimomarine.com and
www.massimoelectric.com.
Forward-Looking Statements
This press release contains statements that constitute
"forward-looking statements," including with respect to the initial
public offering and the use of proceeds thereof. In some cases, you
can identify forward-looking statements because they contain words
such as "anticipate," "believe," "estimate," "expect," "intend,"
"may," "predict," "project," "target," "potential," "seek," "will,"
"would," "could," "should," "continue," "contemplate," "plan," and
other words and terms of similar meaning. These forward-looking
statements include information concerning statements regarding
future cash needs, future operations, business plans and future
financial results; and any other statements that are not historical
facts. No assurance can be given that the proceeds of the offering
will be used as indicated. Forward-looking statements are subject
to numerous conditions, many of which are beyond the control of
Massimo, including those set forth in the "Risk Factors" section of
Massimo's Registration Statement on Form S-1 for the initial public
offering filed with the SEC. Copies are available on the SEC's
website, www.sec.gov. Massimo undertakes no obligation to
update these statements for revisions or changes after the date of
this release, except as required by law.
MASSIMO GROUP AND
SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
|
|
|
|
|
|
September
30,
2024
(Unaudited)
|
|
|
December
31,
2023
(Audited)
|
|
|
|
As of
|
|
|
|
September
30,
2024
(Unaudited)
|
|
|
December
31,
2023
(Audited)
|
|
ASSETS
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
1,723,783
|
|
|
$
|
765,814
|
|
Accounts receivable,
net
|
|
|
11,557,733
|
|
|
|
9,566,445
|
|
Inventories,
net
|
|
|
30,913,746
|
|
|
|
25,800,912
|
|
Advance to
suppliers
|
|
|
323,268
|
|
|
|
1,589,328
|
|
Other current
assets
|
|
|
567,485
|
|
|
|
637,509
|
|
Total current
assets
|
|
|
45,086,015
|
|
|
|
38,360,008
|
|
|
|
|
|
|
|
|
|
|
NON-CURRENT
ASSETS
|
|
|
|
|
|
|
|
|
Property and equipment
at cost, net
|
|
|
600,034
|
|
|
|
399,981
|
|
Right of use operating
lease assets, net
|
|
|
10,125,587
|
|
|
|
1,478,221
|
|
Right of use financing
lease assets, net
|
|
|
82,410
|
|
|
|
113,549
|
|
Deferred offering
assets
|
|
|
-
|
|
|
|
1,457,119
|
|
Other non-current
assets
|
|
|
49,500
|
|
|
|
-
|
|
Deferred tax
assets
|
|
|
1,109,292
|
|
|
|
134,601
|
|
Total non-current
assets
|
|
|
11,966,823
|
|
|
|
3,583,471
|
|
TOTAL
ASSETS
|
|
$
|
57,052,838
|
|
|
$
|
41,943,479
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
|
|
|
Short-term
loans
|
|
$
|
-
|
|
|
$
|
303,583
|
|
Accounts
payable
|
|
|
9,764,284
|
|
|
|
12,678,077
|
|
Other payable, accrued
expenses and other current liabilities
|
|
|
4,007,780
|
|
|
|
98,097
|
|
Accrued return
liabilities
|
|
|
163,666
|
|
|
|
283,276
|
|
Accrued warranty
liabilities
|
|
|
608,644
|
|
|
|
619,113
|
|
Contract
liabilities
|
|
|
1,167,161
|
|
|
|
1,835,411
|
|
Current portion of
obligations under operating leases
|
|
|
2,075,541
|
|
|
|
847,368
|
|
Current portion of
obligations under financing leases
|
|
|
42,970
|
|
|
|
41,647
|
|
Income tax
payable
|
|
|
2,031,571
|
|
|
|
2,121,083
|
|
Loan from a related
party
|
|
|
6,416,525
|
|
|
|
-
|
|
Total current
liabilities
|
|
|
26,278,142
|
|
|
|
18,827,655
|
|
|
|
|
|
|
|
|
|
|
NON-CURRENT
LIABILITIES
|
|
|
|
|
|
|
|
|
Obligations under
operating leases, non-current
|
|
|
8,186,938
|
|
|
|
630,853
|
|
Obligations under
financing leases, non-current
|
|
|
44,629
|
|
|
|
77,024
|
|
Loan from a related
party
|
|
|
-
|
|
|
|
7,920,141
|
|
Total non-current
liabilities
|
|
|
8,231,567
|
|
|
|
8,628,018
|
|
TOTAL
LIABILITIES
|
|
$
|
34,509,709
|
|
|
$
|
27,455,673
|
|
|
|
|
|
|
|
|
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
|
|
|
Common shares, $0.001
par value, 100,000,000 shares authorized,
41,329,235 and 40,000,000 issued and outstanding as of
September
30, 2024 and December 31, 2023, respectively
|
|
|
41,329
|
|
|
|
40,000
|
|
Preferred shares, $0.01
par value, 5,000,000 preferred shares
authorized, no shares were issued and outstanding as of
September
30, 2024 and December 31, 2023, respectively
|
|
|
-
|
|
|
|
-
|
|
Subscription
receivable
|
|
|
-
|
|
|
|
(832,159)
|
|
Additional
paid-in-capital
|
|
|
5,720,756
|
|
|
|
1,994,000
|
|
Retained
earnings
|
|
|
16,781,044
|
|
|
|
13,285,965
|
|
Total
equity
|
|
|
22,543,129
|
|
|
|
14,487,806
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES
AND EQUITY
|
|
$
|
57,052,838
|
|
|
$
|
41,943,479
|
|
MASSIMO GROUP AND
SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHESIVE
INCOME
(UNAUDITED)
|
|
|
|
|
|
Three Months
Ended
|
|
|
Nine Months
Ended
|
|
|
|
September
30,
|
|
|
September
30,
|
|
|
|
2024
|
|
|
2023
|
|
|
2024
|
|
|
2023
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
25,602,310
|
|
|
$
|
29,907,697
|
|
|
$
|
91,156,640
|
|
|
$
|
75,483,811
|
|
Cost of
revenues
|
|
|
18,649,995
|
|
|
|
19,850,258
|
|
|
|
62,253,681
|
|
|
|
51,706,682
|
|
Gross
profit
|
|
|
6,952,315
|
|
|
|
10,057,439
|
|
|
|
28,902,959
|
|
|
|
23,777,129
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling
expense
|
|
|
2,628,915
|
|
|
|
2,104,505
|
|
|
|
7,936,761
|
|
|
|
6,541,244
|
|
General and
administrative
|
|
|
3,895,232
|
|
|
|
2,716,733
|
|
|
|
12,096,874
|
|
|
|
9,038,488
|
|
Impairment loss on
supplier deposit
|
|
|
29,883
|
|
|
|
-
|
|
|
|
772,780
|
|
|
|
-
|
|
Research and
development
|
|
|
94,771
|
|
|
|
-
|
|
|
|
257,021
|
|
|
|
-
|
|
Total operating
expenses
|
|
|
6,648,801
|
|
|
|
4,821,238
|
|
|
|
21,063,436
|
|
|
|
15,579,732
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
|
|
303,514
|
|
|
|
5,236,201
|
|
|
|
7,839,523
|
|
|
|
8,197,397
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income,
net
|
|
|
210,701
|
|
|
|
41,133
|
|
|
|
590,538
|
|
|
|
113,001
|
|
Loss on
litigation
|
|
|
(3,573,651)
|
|
|
|
-
|
|
|
|
(3,573,651)
|
|
|
|
-
|
|
Interest
expense
|
|
|
(64,462)
|
|
|
|
(213,901)
|
|
|
|
(268,803)
|
|
|
|
(494,011)
|
|
Total other
(expense) income, net
|
|
|
(3,427,412)
|
|
|
|
(172,768)
|
|
|
|
(3,251,916)
|
|
|
|
(381,010)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) income before
income taxes
|
|
|
(3,123,898)
|
|
|
|
5,063,433
|
|
|
|
4,587,607
|
|
|
|
7,816,387
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Recovery of )
provision for income
taxes
|
|
|
(621,665)
|
|
|
|
1,106,046
|
|
|
|
1,092,528
|
|
|
|
1,236,551
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
and comprehensive
(loss) income
|
|
$
|
(2,502,233)
|
|
|
$
|
3,957,387
|
|
|
$
|
3,495,079
|
|
|
$
|
6,579,836
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) Earnings per
Share – basic
|
|
$
|
(0.06)
|
|
|
$
|
0.10
|
|
|
$
|
0.09
|
|
|
$
|
0.16
|
|
Weighted average shares
outstanding –
basic *
|
|
|
41,325,388
|
|
|
|
40,000,000
|
|
|
|
40,863,370
|
|
|
|
40,000,000
|
|
(Loss) Earnings per
Share –diluted
|
|
$
|
(0.06)
|
|
|
$
|
0.10
|
|
|
$
|
0.09
|
|
|
$
|
0.16
|
|
Weighted average shares
outstanding –
diluted*
|
|
|
41,325,388
|
|
|
|
40,000,000
|
|
|
|
41,005,556
|
|
|
|
40,000,000
|
|
|
|
*
Retroactively restated for effect of
reorganization
|
|
MASSIMO GROUP AND
SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
|
|
|
|
Nine Months Ended
September 30,
|
|
|
|
2024
|
|
|
2023
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
3,495,079
|
|
|
$
|
6,579,836
|
|
Adjustments to
reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
98,111
|
|
|
|
109,765
|
|
Non-cash operating
lease expense
|
|
|
1,342,402
|
|
|
|
793,577
|
|
Accretion of finance
lease liabilities
|
|
|
3,672
|
|
|
|
5,610
|
|
Amortization of finance
lease right-of-use assets
|
|
|
31,139
|
|
|
|
31,733
|
|
Written-off of account
receivables
|
|
|
-
|
|
|
|
420,967
|
|
Provision of (Reversal
of) allowance for excepted credit loss, net
|
|
|
223,051
|
|
|
|
(118,144)
|
|
Gain on disposal of
fixed asset
|
|
|
(36,001)
|
|
|
|
-
|
|
Impairment loss of
asset
|
|
|
772,780
|
|
|
|
-
|
|
Loss on
litigation
|
|
|
3,573,651
|
|
|
|
-
|
|
RSU
compensation
|
|
|
426,666
|
|
|
|
-
|
|
Share-based
compensation for services
|
|
|
131,699
|
|
|
|
-
|
|
Deferred tax
assets
|
|
|
(974,691)
|
|
|
|
(65,158)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(2,214,339)
|
|
|
|
(1,631,919)
|
|
Inventories
|
|
|
(5,002,834)
|
|
|
|
(36,157)
|
|
Reversal of inventory
impairment
|
|
|
(110,000)
|
|
|
|
-
|
|
Advance to
suppliers
|
|
|
493,280
|
|
|
|
(130,580)
|
|
Other current
assets
|
|
|
20,524
|
|
|
|
(818,397)
|
|
Related party
payable
|
|
|
-
|
|
|
|
398,700
|
|
Accounts
payables
|
|
|
(2,913,793)
|
|
|
|
(373,314)
|
|
Other payable, accrued
expense and other current liabilities
|
|
|
336,032
|
|
|
|
(154,530)
|
|
Tax payable
|
|
|
(89,512)
|
|
|
|
1,237,709
|
|
Accrued warranty
liabilities
|
|
|
(10,469)
|
|
|
|
205,868
|
|
Accrued return
liabilities
|
|
|
(119,610)
|
|
|
|
(341,317)
|
|
Contract
liabilities
|
|
|
(668,250)
|
|
|
|
457,936
|
|
Lease liabilities –
operating lease
|
|
|
(1,205,510)
|
|
|
|
(793,577)
|
|
Net cash (used in)
provided by operating activities
|
|
|
(2,396,923)
|
|
|
|
5,778,608
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Proceed from sales of
property and equipment
|
|
|
162,001
|
|
|
|
-
|
|
Acquisition of property
and equipment
|
|
|
(424,164)
|
|
|
|
(68,871)
|
|
Net cash used in
investing activities
|
|
|
(262,163)
|
|
|
|
(68,871)
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Repayment of other
loans
|
|
|
(303,583)
|
|
|
|
(1,600,000)
|
|
Repayment of finance
lease liabilities
|
|
|
(34,744)
|
|
|
|
(35,469)
|
|
Proceed from common
share issuances
|
|
|
80,000
|
|
|
|
-
|
|
Deferred offering
costs
|
|
|
-
|
|
|
|
(263,162)
|
|
Proceeds from initial
public offering, net of share issuance costs
|
|
|
4,458,667
|
|
|
|
-
|
|
Repayment of loan from
a related party
|
|
|
(1,503,616)
|
|
|
|
(3,982,876)
|
|
Proceeds from
subscription deposits
|
|
|
920,331
|
|
|
|
381,841
|
|
Net cash provided by
(used in) financing activities
|
|
|
3,617,055
|
|
|
|
(5,499,666)
|
|
|
|
|
|
|
|
|
|
|
Net increase in cash
and cash equivalents
|
|
|
957,969
|
|
|
|
210,071
|
|
Cash and cash
equivalents, beginning of the period
|
|
|
765,814
|
|
|
|
947,971
|
|
Cash and cash
equivalents, end of the period
|
|
$
|
1,723,783
|
|
|
$
|
1,158,042
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW
INFORMATION:
|
|
|
|
|
|
|
|
|
Cash paid for
interest
|
|
$
|
244,173
|
|
|
$
|
494,011
|
|
Cash paid for income
taxes
|
|
$
|
2,156,731
|
|
|
$
|
64,000
|
|
|
|
|
|
|
|
|
|
|
NON-CASH
ACTIVITIES
|
|
|
|
|
|
|
|
|
Right of use assets
obtained in exchange for operating lease
obligations
|
|
$
|
9,758,345
|
|
|
$
|
1,113,140
|
|
Right of use assets
obtained in exchange for finance lease
|
|
$
|
-
|
|
|
$
|
60,805
|
|
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SOURCE Massimo Group