Form Tyoe: 10-K-A

Analyst Summary

• Revenue increased from $158.7 million in 2023 to $175.6 million in 2024, indicating positive growth momentum.
• Net loss decreased from $49.8 million in 2023 to $31.0 million in 2024, showing progress towards profitability.
• Cash and cash equivalents decreased from $137.0 million in 2023 to $111.8 million in 2024, reflecting cash usage in operations and share repurchases.
• Gross Profit Margin decreased from 89.9% to 85.0%, indicating a negative trend.
• Operating Profit Margin improved from -35.6% to -21.2%, indicating improvement in operational efficiency.
• Net Profit Margin improved from -31.3% to -17.7%, indicating improvement in overall profitability.
• Current Ratio decreased from 5.63 to 4.11, indicating a negative trend.
• Cash Ratio decreased from 4.73 to 3.40, indicating a negative trend.
• Debt-to-Equity Ratio increased from 0.28 to 0.35, indicating a negative trend.
• Asset Turnover increased from 0.78 to 1.10, indicating a positive trend.
• Revenue Growth was 10.64%.
• Net Income Growth was -37.61%.
• EPS Growth was -38.18%.

Potential Implications

Company Performance

• Continued revenue growth and improved operational efficiency could lead to future profitability.
• Managing costs effectively is crucial for achieving sustainable profitability.
• Efficient asset utilization and shareholder return are areas that need improvement.
• The company’s future performance hinges on its ability to execute its strategic initiatives and navigate the evolving automotive retail landscape.

Stock Price

• Improved profitability metrics could positively impact the stock price.
• Continued losses and negative ROA/ROE could negatively impact investor sentiment.
• The company’s ability to achieve sustainable profitability will be a key factor in determining the stock price.

Analyst Summary

• The company’s amended 10-K filing addresses wording errors but does not change the underlying financial concerns.
• KEEMO Fashion faces a going concern risk due to operating losses, negative cash flow, and reliance on director funding.
• Material weaknesses exist in internal controls, including a lack of a functioning audit committee and inadequate segregation of duties.
• Revenue increased slightly from $16,945 in 2023 to $21,522 in 2024, but the net loss significantly widened from ($22,196) to ($42,275).
• The company’s current liabilities far exceed its current assets, indicating a severe liquidity problem; the current ratio decreased from 0.87 in 2023 to 0.37 in 2024.
• Gross profit margin remained relatively stable at around 49%.
• The company’s business model relies heavily on the sole officer and director’s network.
• Customer and supplier concentration pose additional risks.
• The debt-to-assets ratio increased significantly from 1.16 in 2023 to 2.72 in 2024, indicating higher leverage.

Opportunities and Risks

• Risk: Liquidity risk due to negative working capital and reliance on director funding.
• Risk: Operational risk due to dependence on a single individual and a nascent marketing strategy.
• Risk: Competitive risk in the highly competitive apparel industry in China.
• Risk: Internal control risk due to material weaknesses.
• Risk: Regulatory risk associated with operating in China.
• Opportunity: Potential for expansion in the growing apparel market in Asian countries.
• Opportunity: Targeting small e-commerce retailers as a viable strategy.

Potential Implications

Company Performance

• Continued operating losses and negative cash flow will likely hinder the company’s ability to invest in growth initiatives.
• Reliance on director funding may create conflicts of interest and unsustainable financial practices.
• Internal control weaknesses increase the risk of financial misstatements and fraud, potentially damaging the company’s reputation and investor confidence.
• The company’s ability to continue as a going concern is highly uncertain.

Stock Price

• The going concern warning and internal control deficiencies are likely to negatively impact the stock price.
• The company’s weak financial performance and high debt levels may deter potential investors.
• Negative investor sentiment could lead to a further decline in the stock price.

Analyst Summary

• Jingbo Technology, Inc. reported a 53.78% decrease in revenue, from $3,426,492 to $1,583,637.
• The company experienced a net loss of $5,482,077, a 22.87% improvement compared to the previous year’s net loss of $7,107,559.
• Total assets decreased by 44.26%, from $23,081,187 to $12,866,660, while total liabilities decreased by 14.77%, from $37,037,567 to $31,568,840.
• The company’s cash and cash equivalents decreased by 55.15%, from $331,073 to $148,505.
• Management attributes the revenue decrease to a reduction in the number of parking lots due to contract non-renewals.
• The auditor’s report includes an explanatory paragraph regarding the company’s ability to continue as a going concern, citing substantial losses and negative working capital.
• The company relies on VIE agreements to operate in China, which introduces regulatory risks.
• The company identifies material weaknesses in internal control over financial reporting, including the lack of a functioning audit committee and inadequate segregation of duties.
• The Gross Profit Margin has improved slightly from -34.4% to -34.0%.
• The Operating Profit Margin has worsened from -206.5% to -322.6%.
• The Net Profit Margin has worsened from -207.5% to -346.2%.
• The ROA has worsened from -30.8% to -42.6%.
• The ROE has decreased from 50.9% to 29.3%.
• EPS has increased from -$6.42 to -$1.00.
• The Current Ratio has decreased from 2.24 to 0.15.
• The Quick Ratio has decreased from 2.22 to 0.147.
• The Cash Ratio has decreased from 0.054 to 0.005.
• The Debt-to-Equity Ratio has increased from -2.65 to -1.69.
• The Debt-to-Assets Ratio has increased from 1.60 to 2.45.
• The Interest Coverage Ratio has decreased from N/A to -188.86.
• The Inventory Turnover has decreased from 74.51 to 12.99.
• The DSO has increased from 65.7 days to 115.3 days.
• The DPO has increased from 64.7 days to 110.5 days.
• The Asset Turnover has decreased from 0.297 to 0.088.
• The P/E = $38,005,216 / (-$5,482,077) = -6.93
• The P/B = $38,005,216 / (-$18,702,180) = -2.03
• The P/S ratio is relatively high, suggesting the company is overvalued relative to its sales.
• The EV/EBITDA = $69,431,622 / (-$4,640,458) = -14.96
• Revenue Growth: (Current Revenue – Previous Revenue) / Previous Revenue = ($1,583,637 – $3,426,492) / $3,426,492 = -53.8%
• Net Income Growth: (Current Net Income – Previous Net Income) / Previous Net Income = (-$5,482,077 – (-$7,107,559)) / (-$7,107,559) = -22.9%
• EPS Growth: (Current EPS – Previous EPS) / Previous EPS = (-$1.00 – (-$6.42)) / (-$6.42) = -84.4%

Opportunities and Risks

• Regulatory Risks: The company faces significant regulatory risks due to its VIE structure and operations in China, including potential changes in laws and regulations related to foreign investment, data security, and cybersecurity.
• Financial Risks: The company’s financial performance is weak, with declining revenue, net losses, and a high level of debt.
• Operational Risks: The company’s reliance on key personnel and potential conflicts of interest with VIE shareholders pose operational risks.
• HFCA Act Risks: The company is subject to the Holding Foreign Companies Accountable Act (HFCA Act), which could lead to delisting if the PCAOB is unable to inspect the company’s auditors.
• Smart Parking Market: The smart parking market in China has growth potential, driven by increasing urbanization and demand for efficient parking solutions.
• Platform Development: The company’s Any-e Life platform has the potential to generate revenue through parking operations, hardware sales, and e-commerce.
• Franchising Policies: The company’s franchising policies could drive expansion and user acquisition.

Potential Implications

Company Performance

• Improve Financial Performance: Focus on increasing revenue and improving operational efficiencies to achieve profitability.
• Strengthen Internal Controls: Address the identified material weaknesses in internal control over financial reporting.
• Ensure Regulatory Compliance: Closely monitor and comply with evolving regulations in China, particularly those related to foreign investment, data security, and cybersecurity.
• Monitor HFCA Act Compliance: Ensure continued compliance with the HFCA Act to avoid potential delisting.
• Evaluate VIE Structure: Assess the long-term viability of the VIE structure and explore alternative operational models if necessary.