Form 10-Q - Quarterly report [Sections 13 or 15(d)]

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________________________________

FORM 10-Q

_____________________________________________

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended:

September 30, 2024


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-41207

_____________________________________________

FGI Industries Ltd.

(Exact name of registrant as specified in its charter)

_____________________________________________


Cayman Islands			98-1603252
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

906 Murray Road

East Hanover, New Jersey 07936

(Address of principal executive offices)

(Zip Code)

(973) 428-0400

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Ordinary Shares, $0.0001 par value

FGI

Nasdaq Capital Market

Warrants to purchase Ordinary Shares, $0.0001 par value

FGIWW

Nasdaq Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging Growth Company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

The number of shares outstanding of the registrant's common stock on November 5, 2024 was 9,563,914.

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TABLE OF CONTENTS


		Page

Special Note Regarding Forward-Looking Statements		3

General		4

PART I- FINANCIAL INFORMATION		5

Item 1.	Financial Statements.	5

	Condensed Consolidated Balance Sheets as of September 30, 2024 (Unaudited) and December 31, 202 3 (Audited).	6

	Unaudited Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income for the three and nine months ended September 30, 2024 and 2023.	7

	Unaudited Condensed Consolidated Statements of Changes in Shareholders’ Equity for the three and nine months ended September 30, 2024 and 2023.	8

	Unaudited Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023.	9

	Notes to Unaudited Condensed Consolidated Financial Statements.	11

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	35

Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	44

Item 4.	Controls and Procedures.	44

PART II- OTHER INFORMATION		45

Item 1.	Legal Proceedings.	45

Item 1A.	Risk Factors.	45

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	46

Item 3.	Defaults Upon Senior Securities.	46

Item 4.	Mine Safety Disclosures.	46

Item 5.	Other Information.	46

Item 6.	Exhibits.	47

SIGNATURES		48

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this Quarterly Report on Form 10-Q are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. All statements contained in this Quarterly Report on Form 10-Q other than statements of historical facts, including statements regarding our future results of operations and financial position, our business strategy and plans and our objectives for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “aim,” “anticipate,” “assume,” “believe,” “contemplate,” “continue,” “could,” “design,” “due,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective,” “plan,” “predict,” “positioned,” “potential,” “seek,” “should,” “target,” “will,” “would” and other similar expressions that are predictions of or indicate future events and future trends, or the negative of these terms or other comparable terminology. In addition, statements that “we believe” or similar statements reflect our beliefs and opinions on the relevant subject. We have based these forward- looking statements on our current expectations about future events. While we believe these expectations are reasonable, such forward-looking statements are inherently subject to risks and uncertainties, many of which are beyond our control. Risks and uncertainties that could cause our actual results to differ from those expressed in, or implied by, our forward- looking statements include, but are not limited to:

•the levels of residential repair and remodel activity, and to a lesser extent, new home construction;

•the effects of inflationary pressures, financial market uncertainty and rising interest rates on the demand for our products, our costs and our ability to access capital;

•our ability to maintain our strong brands and reputation and to develop innovative products;

•our ability to maintain our competitive position in our industries;

•our reliance on key suppliers and customers;

•the occurrence of public health emergencies, such as the COVID-19 pandemic, including the impact on domestic and international economic activity, consumer confidence, our production capabilities, our employees and our supply chain;

•the cost and availability of materials and the imposition of tariffs;

•risks associated with our international operations and global strategies;

•our ability to achieve the anticipated benefits of our strategic initiatives;

•our ability to successfully execute our acquisition strategy and integrate businesses that we may acquire;

•our ability to obtain additional capital to finance our planned operations and to maintain our listing on Nasdaq;

•risks associated with our reliance on information systems and technology, and our ability to achieve the anticipated benefits from our investments in new technology;

•our ability to attract, develop and retain talented and diverse personnel;

•our ability to obtain additional capital to finance our planned operations;

•regulatory developments in the United States and internationally;

•our ability to establish and maintain intellectual property protection for our products, as well as our ability to operate our business without infringing the intellectual property rights of others; and

•other risks and uncertainties, including those listed under the caption “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023, as well as subsequent reports we file from time to time with the U.S. Securities and Exchange Commission (the “SEC”) (available at www.sec.gov).

These forward-looking statements are based on management’s current expectations, estimates, forecasts and projections about our business and the industry in which we operate, and management’s beliefs and assumptions are not

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guarantees of future performance or development and involve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. In light of the significant uncertainties in these forward-looking statements, you should not rely upon forward-looking statements as predictions of future events. Although we believe the expectations reflected in the forward-looking statements are reasonable, the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements may not be achieved or occur at all. You should read this Quarterly Report on Form 10-Q and the documents that we reference and have filed as exhibits to this Quarterly Report on Form 10-Q completely and with the understanding that our actual future results may be materially different from what we expect. These forward-looking statements speak only as of the date of this Quarterly Report on Form 10-Q. Except as required by law, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

GENERAL

Unless the context otherwise requires, all references in this Quarterly Report on Form 10-Q to the “Company,” “FGI,” “we,” “us” or “our” refer to FGI Industries Ltd.

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PART I —FINANCIAL INFORMATION

Item 1. Financial Statements.

FGI INDUSTRIES LTD.

INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


Condensed Consolidated Balance Sheets as of September 30, 2024 (Unaudited) and December 31, 2023 (Audited)			6

Unaudited Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income for the three and nine months ended September 30, 2024 and 2023			7

Unaudited Condensed Consolidated Statements of Changes in Shareholders’ Equity for the three and nine months ended September 30, 2024 and 2023			8

Unaudited Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2024 and 2023			9

Notes to Unaudited Condensed Consolidated Financial Statements			11-34

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FGI INDUSTRIES LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS


	As of September 30, 2024		As of December 31, 2023
	USD		USD
	(Unaudited)
ASSETS

CURRENT ASSETS
Cash	$	3,044,662	$	7,777,241
Accounts receivable, net	19,009,238		16,195,543
Inventories, net	13,785,509		9,923,852
Prepayments and other current assets	2,590,207		4,617,751
Prepayments and other receivables – related parties	13,969,963		7,600,283
Total current assets	52,399,579		46,114,670

PROPERTY AND EQUIPMENT, NET	2,957,231		1,910,491

OTHER ASSETS
Intangible assets	1,927,330		102,227
Operating lease right-of-use assets, net	13,488,342		15,203,576
Deferred tax assets, net	2,019,657		1,168,833
Other noncurrent assets	1,872,787		1,245,133
Total other assets	19,308,116		17,719,769
Total assets	$	74,664,926	$	65,744,930

LIABILITIES AND SHAREHOLDERS’ EQUITY

CURRENT LIABILITIES
Short-term loans	$	12,485,497	$	6,959,175
Accounts payable	20,228,128		14,524,607
Accounts payable – related parties	5,053		735,308
Income tax payable	64,750		189,119
Operating lease liabilities – current	1,785,996		1,595,998
Accrued expenses and other current liabilities	5,134,193		4,039,499
Total current liabilities	39,703,617		28,043,706

OTHER LIABILITIES
Operating lease liabilities – noncurrent	12,057,751		13,674,452
Total liabilities	51,761,368		41,718,158

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS’ EQUITY
Preference Shares ($0.0001 par value, 10,000,000 shares authorized, no shares issued and outstanding as of September 30, 2024 and December 31, 2023)	—		—
Ordinary shares ($0.0001 par value, 200,000,000 shares authorized, 9,563,914 and 9,547,607 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively)	956		955
Additional paid-in capital	21,414,428		20,877,832
Retained earnings	3,614,763		4,413,524
Accumulated other comprehensive loss	(1,511,788)		(1,111,499)
FGI Industries Ltd. shareholders’ equity	23,518,359		24,180,812
Non-controlling interests	(614,801)		(154,040)
Total shareholders’ equity	22,903,558		24,026,772
Total liabilities and shareholders’ equity	$	74,664,926	$	65,744,930

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The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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FGI INDUSTRIES LTD.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Revenue	$	36,099,179	$	29,932,612	$	96,223,647	$	86,284,791

Cost of revenue	26,790,957		22,103,325		69,538,640		63,242,944

Gross profit	9,308,222		7,829,287		26,685,007		23,041,847

Operating expenses
Selling and distribution	6,284,932		4,572,593		18,676,665		14,084,200
General and administrative	2,637,141		2,351,307		7,542,019		6,746,055
Research and development	451,975		423,697		1,303,445		1,152,554
Total operating expenses	9,374,048		7,347,597		27,522,129		21,982,809

(Loss) income from operations	(65,826)		481,690		(837,122)		1,059,038

Other income (expenses)
Interest income	584		1,102		5,251		6,524
Interest expense	(366,420)		(16,382)		(893,721)		(559,730)
Other income, net	951		49,598		457,481		19,357
Total other (expenses) income, net	(364,885)		34,318		(430,989)		(533,849)

(Loss) income before income taxes	(430,711)		516,008		(1,268,111)		525,189

Provision for (benefit of) income taxes
Current	518,585		225,127		857,293		539,681
Deferred	(251,048)		(52,611)		(865,882)		(143,090)
Total provision for (benefit of) income taxes	267,537		172,516		(8,589)		396,591

Net (loss) income	(698,248)		343,492		(1,259,522)		128,598
Less: net loss attributable to non-controlling shareholders	(148,111)		(66,043)		(460,761)		(66,043)
Net (loss) income attributable to FGI Industries Ltd. shareholders	(550,137)		409,535		(798,761)		194,641

Other comprehensive income (loss)
Foreign currency translation adjustment	47,269		(44,497)		(400,289)		(19,501)

Comprehensive (loss) income	(650,979)		298,995		(1,659,811)		109,097
Less: comprehensive loss attributable to non-controlling shareholders	(148,111)		(66,043)		(460,761)		(66,043)
Comprehensive (loss) income attributable to FGI Industries Ltd. shareholders	$	(502,868)	$	365,038	$	(1,199,050)	$	175,140

Weighted average number of ordinary shares
Basic	9,563,914		9,500,000		9,565,587		9,500,000
Diluted	9,563,914		9,786,522		9,565,587		9,822,847

(Loss) earnings per share
Basic	$	(0.06)	$	0.04	$	(0.08)	$	0.02
Diluted	$	(0.06)	$	0.04	$	(0.08)	$	0.02

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The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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FGI INDUSTRIES LTD.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’

EQUITY


	Preference Shares			Ordinary Shares			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total FGI Industries Ltd. Shareholders' Equity		Non- Controlling Interests		Total Shareholders' Equity
	Shares	Amount		Shares	Amount
Balance at December 31, 2023	—	$	—	9,547,607	$	955	$	20,877,832	$	4,413,524	$	(1,111,499)	$	24,180,812	$	(154,040)	$	24,026,772
Share-based compensation	—	—		—	—		119,586		—		—		119,586		—		119,586
Net loss	—	—		—	—		—		(412,189)		—		(412,189)		(125,670)		(537,859)
Foreign currency translation adjustments	—	—		—	—		—		—		(22,578)		(22,578)		—		(22,578)
Balance at March 31, 2024	—	$	—	9,547,607	$	955	$	20,997,418	$	4,001,335	$	(1,134,077)	$	23,865,631	$	(279,710)	$	23,585,921
Share-based compensation	—	—		16,307	1		208,504		—		—		208,505		—		208,505
Net income (loss)	—	—		—	—		—		163,565		—		163,565		(186,980)		(23,415)
Foreign currency translation adjustments	—	—		—	—		—		—		(424,980)		(424,980)		—		(424,980)
Balance at June 30, 2024	—	$	—	9,563,914	$	956	$	21,205,922	$	4,164,900	$	(1,559,057)	$	23,812,721	$	(466,690)	$	23,346,031
Share-based compensation	—	—		—	—		208,506		—		—		208,506		—		208,506
Net loss	—	—		—	—		—		(550,137)		—		(550,137)		(148,111)		(698,248)
Foreign currency translation adjustments	—	—		—	—		—		—		47,269		47,269		—		47,269
Balance at September 30, 2024	—	$	—	9,563,914	$	956	$	21,414,428	$	3,614,763	$	(1,511,788)	$	23,518,359	$	(614,801)	$	22,903,558


	Preference Shares			Ordinary Shares			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total FGI Industries Ltd. Shareholders' Equity		Non- Controlling Interests		Total Shareholders' Equity
	Shares	Amount		Shares	Amount
Balance at December 31, 2022	—	$	—	9,500,000	$	950	$	20,459,859	$	3,679,920	$	(1,396,319)	$	22,744,410	$	—	$	22,744,410
Share-based compensation	—	—		—	—		119,721		—		—		119,721		—		119,721
Net loss	—	—		—	—		—		(303,375)		—		(303,375)		—		(303,375)
Foreign currency translation adjustments	—	—		—	—		—		—		20,099		20,099		—		20,099
Balance at March 31, 2023	—	$	—	9,500,000	$	950	$	20,579,580	$	3,376,545	$	(1,376,220)	$	22,580,855	$	—	$	22,580,855
Share-based compensation	—	—		—	—		152,835		—		—		152,835		—		152,835
Net income	—	—		—	—		—		88,481		—		88,481		—		88,481
Foreign currency translation adjustments	—	—		—	—		—		—		4,897		4,897		—		4,897
Balance at June 30, 2023	—	$	—	9,500,000	$	950	$	20,732,415	$	3,465,026	$	(1,371,323)	$	22,827,068	$	—	$	22,827,068
Share-based compensation	—	—		—	—		59,337		—		—		59,337		—		59,337
Net income (loss)	—	—		—	—		—		409,535		—		409,535		(66,043)		343,492
Foreign currency translation adjustments	—	—		—	—		—		—		(44,497)		(44,497)		—		(44,497)
Balance at September 30, 2023	—	$	—	9,500,000	$	950	$	20,791,752	$	3,874,561	$	(1,415,820)	$	23,251,443	$	(66,043)	$	23,185,400

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The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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FGI INDUSTRIES LTD.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


	For the Nine Months Ended September 30,
	2024		2023
	USD		USD
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income	$	(1,259,522)	$	128,598
Adjustments to reconcile net (loss) income to net cash used in operating activities
Depreciation	324,683		135,256
Amortization	1,818,366		1,247,096
Share-based compensation	536,597		331,893
Provision for credit losses	79,762		31,324
Provision for defective return	489,975		(710,643)
Foreign exchange transaction loss	(225,317)		(23,875)
Deferred income tax benefit	(850,825)		(143,090)
Changes in operating assets and liabilities
Accounts receivable	(3,792,409)		(1,627,547)
Inventories	(3,861,657)		3,658,593
Prepayments and other current assets	785,879		(1,250,806)
Prepayments and other receivables – related parties	(5,960,704)		(5,360,839)
Other noncurrent assets	(627,654)		568,820
Income taxes	(124,369)		188,964
Accounts payable	5,703,521		(666,122)
Accounts payable - related parties	(730,254)		2,381,322
Operating lease liabilities	(1,443,510)		(946,208)
Accrued expenses and other current liabilities	1,094,693		70,300
Net cash used in operating activities	(8,042,745)		(1,986,964)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment	(1,374,500)		(274,971)
Purchase of intangible assets	(669,764)		(608,083)
Net cash used in investing activities	(2,044,264)		(883,054)

CASH FLOWS FROM FINANCING ACTIVITIES
Net proceeds from (repayments of) revolving credit facility	5,526,322		(1,832,849)
Net cash provided by (used in) financing activities	5,526,322		(1,832,849)

EFFECT OF EXCHANGE RATE FLUCTUATION ON CASH	(171,892)		5,386

NET CHANGES IN CASH	(4,732,579)		(4,697,481)
CASH, BEGINNING OF PERIOD	7,777,241		10,067,428
CASH, END OF PERIOD	$	3,044,662	$	5,369,947

SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid during the period for interest	$	(881,759)	$	(560,314)
Cash paid during the period for income taxes	$	(961,890)	$	(350,500)

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NON-CASH INVESTING AND FINANCING ACTIVITIES
New addition on Right-of-use assets	$	(16,807)	$	(7,644,734)
Acquisition of intangible asset partially through prior period advanced payment	$	(1,241,664)	$	—

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The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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FGI INDUSTRIES LTD.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1 — Nature of business and organization

FGI Industries Ltd. (“FGI” or the “Company”) is a holding company organized on May 26, 2021, under the laws of the Cayman Islands. The Company has no substantive operations other than holding all of the outstanding equity of its operating subsidiaries as described below. The Company is a supplier of global kitchen and bath products and currently focuses on the following categories: sanitaryware (primarily toilets, sinks, pedestals and toilet seats), bath furniture (vanities, mirrors and cabinets), shower systems, customer kitchen cabinetry and other accessory items. These products are sold primarily for repair and remodeling (“R&R”) activity and, to a lesser extent, new home or commercial construction. The Company sells its products through numerous partners, including mass retail centers, wholesale and commercial distributors, online retailers and independent dealers and distributors.

The accompanying unaudited condensed consolidated financial statements reflect the activities of FGI and each of the following entities after the Reorganization, as described below:

Name

Background

Ownership

FGI Industries Inc.

•A New Jersey corporation

100% owned by FGI

(formerly named Foremost Groups, Inc.)

•Incorporated on January 5, 1988

•Sales and distribution in the United States

FGI Europe Investment Limited

•A British Virgin Islands holding company

100% owned by FGI

•Incorporated on January 1, 2007

FGI International, Limited

•A Hong Kong company

100% owned by FGI

•Incorporated on June 2, 2021

•Sales, sourcing and product development

FGI Canada Ltd.

•A Canadian company

100% owned by FGI Industries Inc.

•Incorporated on October 17, 1997

•Sales and distribution in Canada

FGI Germany GmbH & Co. KG

•A German company

100% owned by FGI Europe Investment Limited

•Incorporated on January 24, 2013

•Sales and distribution in Germany

FGI China, Ltd.

•A PRC limited liability company

100% owned by FGI International, Limited

•Incorporated on August 19, 2021

•Sourcing and product development

FGI United Kingdom Ltd

•An UK company

100% owned by FGI Europe Investment Limited

•Incorporated on December 10, 2021

•Sales and distribution in UK

FGI Australasia Pty Ltd

•An Australian company

100% owned by FGI

•Incorporated on September 8, 2022

•Sales and distribution in Australia

Covered Bridge Cabinetry Manufacturing Co., Ltd

•A Cambodian company

100% owned by FGI

•Incorporated on April 21, 2022

•Manufacturing in Cambodia

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Isla Porter LLC

•A New Jersey company

60% owned by FGI Industries Inc.

•Formed on June 2, 2023

•Sales and distribution in the United States

FGI Industries India Private Limited

•An Indian company

100% owned by FGI

•Incorporated on June 11, 2024

•Sales and distribution in India

Reorganization

On January 27, 2022, the following reorganization steps were collectively completed: (i) the incorporation of FGI International, Limited (“FGI International”) and FGI China, Ltd., (ii) FGI Industries Inc. (formerly Foremost Groups, Inc.) (“FGI Industries”), which operates the kitchen and bath (“K&B”) sales and distribution business in the United States and, through its wholly-owned Canadian subsidiary, Foremost International Limited, in Canada, distributed 100% of the outstanding shares of stock of Foremost Kingbetter Food Equipment Inc. (“FKB”), which operates a separate furniture line of business, to Foremost Groups Ltd. (“Foremost”), FGI Industries’ sole shareholder; (iii) Foremost contributed the FKB shares to Foremost Home Inc. (“FHI”), a newly-formed wholly-owned subsidiary of Foremost; and (iv) Foremost contributed 100% of the outstanding shares of stock of each of FGI Industries, FGI Europe Investment Limited (“FGI Europe”), which, directly and, through its wholly-owned German subsidiary, FGI Germany GmbH & Co., operates the K&B sales and distribution business in Europe, and FGI International, which, directly and through its wholly-owned Chinese subsidiary, FGI China, Ltd., operates the K&B sales and distribution business in the remainder of the world, K&B product development and sourcing of K&B products in China, to the Company (collectively, the “Reorganization”), such that, immediately following the Reorganization, (x) Foremost owns 100% of the equity interests in each of the Company and FHI, (y) the Company owns 100% of the equity interests in each of FGI Industries, FGI Europe and FGI International, which collectively, and through subsidiaries, operate the K&B business worldwide (the “K&B Business”), and (z) FHI owns 100% of the equity interests in FKB.

On January 14, 2022 FGI Industries, a wholly-owned subsidiary of the Company, entered into a shared services agreement (the “FHI Shared Services Agreement”) with Foremost Home Inc., a newly-formed wholly-owned subsidiary of Foremost (“FHI”). Pursuant to the FHI Shared Services Agreement, FGI Industries provides FHI with general and administrative services, information technology systems services and human resources services, as well as warehouse space services and supply chain services in the United States. Under the FHI Shared Services Agreement, FHI will reimburse any reasonable and documented out-of-pocket fees incurred by FGI Industries as well as pay a service fee for each service. For warehouse services, FHI will pay FGI Industries a $500,000 annual fee as well as a fee equal to 4% of gross product sales of all products stored in such warehouses. For all other services provided, FHI will pay a service fee equal to the total costs incurred by FGI Industries for such service generally divided by the number of FHI employees relative to FGI Industries employees. The FHI Shared Services Agreement will have an initial term of one year and will renew automatically unless cancelled by either party upon the giving of at least 60 days in advance of the expiration of the then-current term.

On January 14, 2022, the Company entered into a shared services agreement (the “Worldwide Shared Services Agreement”) with Foremost Worldwide Co., Ltd. (“Foremost Worldwide”) pursuant to which Foremost Worldwide provides FGI Industries with general and administrative services, information technology system services and human resources services, in Taiwan. The terms of the Worldwide Services Agreement as between the service provider and recipient are substantially identical to those of the FHI Shared Services Agreement, including calculation of service fees and termination provisions, with Foremost Worldwide providing services and FGI Industries paying Foremost Worldwide for such services. On January 1, 2023, the Worldwide Services Agreement was amended and restated to include additional digital online and related services.

The assets and liabilities have been stated at historical carrying amounts. Only those assets and liabilities that are specifically identifiable to the K&B Business are included in the Company’s unaudited condensed consolidated balance sheets. The Company’s unaudited condensed consolidated statements of operations and comprehensive (loss) income consist of all the revenue, costs and expenses of the K&B Business, including allocations to selling and distribution expenses, general and administrative expenses, and research and development expenses, and which were incurred by FGI but related to the K&B Business prior to the Reorganization.

All revenue and cost of revenue attributable to selling of K&B products were allocated to the Company. Operating expenses were allocated to the Company based on employees and activities that are involved in the K&B Business. Any

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expenses that were not directly attributable to any specific business were allocated to the Company based on the proportion of the number of employees of the K&B Business to the total number of employees of both the K&B Business and FHI.

Since December 2023, the books and records of FHI have been completely separated from FGI Industries. The following table sets forth the revenue, cost of revenue and operating expenses that were irrelevant to the K&B Business allocated from FGI Industries to Foremost Home, Inc. for the three and nine months ended September 30, 2024 and 2023, respectively.


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Revenue	$	—	$	—	$	—	$	991,919
Cost of revenue	—		—		—		(768,065)
Gross profit	—		—		—		223,854
Selling and distribution expenses	—		—		—		45,979
General and administrative expenses	—		—		—		—
Research and development expenses	—		—		—		—
Income from operations	$	—	$	—	$	—	$	269,833

Since October 2022, the books and records of FGI International have been completely separated from Foremost Worldwide Co., Ltd., a wholly-owned subsidiary of Foremost.

Income tax liability is calculated based on a separate return basis as if the K&B Business had filed separate tax returns before the completion of the Reorganization. Immediately following the Reorganization, the K&B Business began to file separate tax returns and report taxation based on the actual tax return of each legal entity.

Management believes the basis and amounts of these allocations are reasonable. While the expenses allocated to the Company for these items are not necessarily indicative of the expenses that would have been incurred if the Company had been a separate, stand-alone entity, the Company does not believe that there is any significant difference between the nature and amounts of these allocated expenses and the expenses that would have been incurred if the Company had been a separate, stand-alone entity.

Note 2 — Summary of significant accounting policies

Liquidity

Historically, the Company finances its operations through internally generated cash, short-term loans and payables. As of September 30, 2024, the Company had approximately $3.0 million in cash and cash equivalents, which primarily consists of cash on hand and bank deposits, which are unrestricted as to withdrawal and use.

If the Company is unable to realize its assets within the normal operating cycle of a twelve (12) month period, the Company may have to consider supplementing its available sources of funds through the following sources:

•other available sources of financing from other banks and financial institutions;

•sales of additional securities to the public or other investors; and

•financial support from the Company’s shareholders.

Based on the above considerations, the Company’s management is of the opinion that it has sufficient funds to meet the Company’s working capital requirements and debt obligations as they become due over the next twelve (12) months.

Basis of presentation

The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commissions (the “SEC”), regarding financial reporting, and include all normal and recurring adjustments that management of the Company considers necessary for a fair presentation of its financial position and operation results.

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Principles of consolidation

The unaudited condensed consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant intercompany transactions and balances between the Company and its subsidiaries are eliminated upon consolidation.

Subsidiaries are those entities which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to govern the financial and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at a meeting of directors.

Use of estimates and assumptions

The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenue and expenses during the periods presented. Significant accounting estimates reflected in the Company’s consolidated financial statements include the useful lives of property and equipment, allowance for credit losses, inventory reserve, accrued defective return, provision for contingent liabilities, revenue recognition, deferred taxes and uncertain tax position. Actual results could differ from these estimates.

Foreign currency translation and transaction

The functional currencies of the Company and its subsidiaries are the local currency of the country in which the subsidiaries operate, except for FGI International, which is incorporated in Hong Kong and adopted the United States Dollar (“U.S. Dollar” or “USD”) as its functional currency. The reporting currency of the Company is the U.S. Dollar. Assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the applicable rates of exchange in effect at that date. The equity denominated in the functional currencies is translated at the historical rates of exchange at the time of capital contributions. The results of operations and the cash flows denominated in foreign currencies are translated at the average rates of exchange during the reporting period. Because cash flows are translated based on the average translation rates, amounts related to assets and liabilities reported on the unaudited condensed consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on the unaudited condensed consolidated balance sheets. Translation adjustments arising from the use of different exchange rates from period to period are included as a separate component of accumulated other comprehensive income included in the unaudited condensed consolidated statements of changes in shareholders’ equity. Transaction gains and losses arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency in the unaudited condensed consolidated statements of operations and comprehensive (loss) income.

For the purpose of presenting the financial statements of subsidiaries using the Renminbi (“RMB”) as their functional currency, the Company’s assets and liabilities are expressed in U.S. Dollars at the exchange rate on the balance sheet date, which was 6.9939 and 7.1006 as of September 30, 2024 and December 31, 2023, respectively; shareholders’ equity accounts are translated at historical rates, and income and expense items are translated at the average exchange rate during the period, which was 7.2080 and 7.2414 for the three months ended September 30, 2024 and 2023, respectively, and 7.2111 and 7.0384 for the nine months ended September 30, 2024 and 2023, respectively.

For the purpose of presenting the financial statements of the subsidiary using the Canadian Dollar (“CAD”) as its functional currency, the Company’s assets and liabilities are expressed in U.S. Dollars at the exchange rate on the balance sheet date, which was 1.3700 and 1.3246 as of September 30, 2024 and December 31, 2023, respectively; shareholders’ equity accounts are translated at historical rates, and income and expense items are translated at the average exchange rate during the period, which was 1.3700 and 1.3541 for the three months ended September 30, 2024 and 2023, respectively, and 1.3448 and 1.3541 for the nine months ended September 30, 2024 and 2023, respectively.

For the purpose of presenting the financial statements of the subsidiary using the Euro (“EUR”) as its functional currency, the Company’s assets and liabilities are expressed in U.S. Dollars at the exchange rate on the balance sheet date, which was 0.8956 and 0.9059 as of September 30, 2024 and December 31, 2023, respectively; shareholders’ equity accounts are translated at historical rates, and income and expense items are translated at the average exchange rate during the period, which was 0.9207 and 0.9143 for the three months ended September 30, 2024 and 2023, respectively, and 0.9220 and 0.9227 for the nine months ended September 30, 2024 and 2023, respectively.

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Reclassification

Certain prior year amounts have been reclassified to conform with the current year presentation, specifically the depreciation and amortization in the unaudited condensed consolidated statements of cash flows. These reclassifications have no effect on the condensed consolidated balance sheets and the unaudited condensed consolidated statements of operations and comprehensive loss previously reported.

Cash

Cash consists of cash on hand and demand deposits placed with banks or other financial institutions that have original maturities of three months or less. The Company did not have any cash equivalents as of September 30, 2024 and December 31, 2023.

Accounts receivable, net

Bills and trade receivables include trade accounts due from customers. In establishing the required allowance for expected credit losses, management considers historical collection experience, aging of the receivables, the economic environment, industry trend analysis, and the credit history and financial conditions of the customers. Management reviews its receivables on a regular basis to determine if the expected credit losses are adequate and adjusts the allowance when necessary. Delinquent account balances are written off against allowance for credit losses after management has determined that the likelihood of collection is not probable.

Inventories, net

Inventories are stated at the lower of cost and net realizable value. Cost consists of purchase price and related shipping and handling expenses, and is determined using the weighted average cost method, based on individual products. The methods of determining inventory costs are used consistently from year to year. A provision for slow-moving items is calculated based on historical experience. Management reviews this provision annually to assess whether, based on economic conditions, it is adequate.

Prepayments

Prepayments are cash deposited or advanced to suppliers for the purchase of goods or services that have not been received or provided. This amount is refundable and bears no interest. Prepayments and deposits are classified as either current or non-current based on the terms of the respective agreements. These advances are unsecured and are reviewed periodically to determine whether their carrying value has become impaired.

Property and equipment, net

Property and equipment are stated at cost net of accumulated depreciation and impairment. Depreciation is provided over the estimated useful lives of the assets using the straight-line method from the time the assets are placed in service. Estimated useful lives are as follows:


			Useful Life
Building			20 years
Leasehold Improvements			Lesser of lease term and expected useful life
Machinery and equipment			3 – 5 years
Furniture and fixtures			3 – 5 years
Vehicles			5 years
Molds			3 – 5 years

Intangible assets, net

The Company’s intangible assets with definite useful lives primarily consist of software acquired for internal use. The Company amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets

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for impairment. The Company typically amortizes its intangible assets with definite useful lives on a straight-line basis over the estimated useful lives of ten years.

Impairment for long-lived assets

Long-lived assets, including property and equipment and intangible assets with definite useful lives, are reviewed for impairment whenever material events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset group may not be recoverable. The Company assesses the recoverability of an asset group based on the undiscounted future cash flows the asset group is expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset group plus net proceeds expected from disposition of the asset group, if any, are less than the carrying value of the asset group. If an impairment is identified, the Company would reduce the carrying amount of the asset group to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. As of September 30, 2024 and December 31, 2023, no impairment of long-lived assets was recognized.

Leases

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use assets, net (“ROU assets”), operating lease liabilities — current and operating lease liabilities — noncurrent on the condensed consolidated balance sheets.

ROU assets represent our right to use an underlying asset for the duration of the lease term while lease liabilities represent the Company’s obligation to make lease payments in exchange for the right to use an underlying asset. ROU assets and lease liabilities are measured based on the present value of fixed lease payments over the lease term at the commencement date. The ROU asset also includes any lease payments made prior to the commencement date and initial direct costs incurred, and is reduced by any lease incentives received. The Company reviews its ROU assets as material events occur or circumstances change that would indicate the carrying amount of the ROU assets are not recoverable and exceed their fair values. If the carrying amount of an ROU asset is not recoverable from its undiscounted cash flows, then the Company would recognize an impairment loss for the difference between the carrying amount and the current fair value.

As most of the Company’s leases do not provide an implicit rate, the Company generally uses its incremental borrowing rate on the commencement date of the lease as the discount rate in determining the present value of future lease payments. The Company determines the incremental borrowing rate for each lease by using the incremental borrowing rate based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date. The Company’s lease terms may include options to extend or terminate the lease when there are relevant economic incentives present that make it reasonably certain that the Company will exercise that option. The Company accounts for any non- lease components separately from lease components.

Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Fair Value Measurement

The accounting standard regarding fair value of financial instruments and related fair value measurements defines financial instruments and requires disclosure of the fair value of financial instruments held by the Company.

The accounting standards define fair value, establish a three-level valuation hierarchy for disclosures of fair value measurement and enhance disclosure requirements for fair value measures. The three levels of the fair value hierarchy are as follows:

•Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

•Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments.

•Level 3 inputs to the valuation methodology are unobservable and significant to the fair value.

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Financial instruments included in current assets and current liabilities are reported in the consolidated balance sheets at face value or cost, which approximate fair value because of the short period of time between the origination of such instruments and their expected realization and their current market rates of interest.

Revenue recognition

The Company recognized revenue in accordance with Accounting Standards Codification (“ASC”) 606 – Revenue from Contracts with Customers. Revenue is recognized when control of the promised goods or performance obligations for services is transferred to the Company’s customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for the goods or services.

The Company generates revenue from sales of kitchen and bath products, and recognizes revenue as control of its products is transferred to its customers, which is generally at the time of shipment or upon delivery based on the contractual terms with the Company’s customers. The Company’s customers’ payment terms generally range from 15 to 60 days of fulfilling its performance obligations and recognizing revenue.

The Company provides customer programs and incentive offerings, including co-operative marketing arrangements and volume-based incentives. These customer programs and incentives are considered variable consideration. The Company includes in revenue variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the variable consideration is resolved. This determination is made based upon known customer program and incentive offerings at the time of sale, and expected sales volume forecasts as it relates to the Company’s volume- based incentives. This determination is updated on a monthly basis.

Certain product sales include a right of return. The Company estimates future product returns at the time of sale based on historical experience and records a corresponding reduction in accounts receivable.

The Company records receivables related to revenue when it has an unconditional right to invoice and receive payment.

The Company’s disaggregated revenue is summarized as follows:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Revenue by product line
Sanitaryware	$	21,451,387	$	20,740,380	$	59,303,663	$	54,949,082
Bath Furniture	4,162,291		2,531,430		11,282,623		12,304,688
Shower System	7,143,283		4,931,437		18,793,999		14,248,679
Others	3,342,218		1,729,365		6,843,362		4,782,342
Total	$	36,099,179	$	29,932,612	$	96,223,647	$	86,284,791


	Total Revenue								Total Assets
	For the Three Months Ended September 30,				For the Nine Months Ended September 30,				As of September 30,		As of December 31,
	2024		2023		2024		2023		2024		2023
	USD		USD		USD		USD		USD		USD

Revenue/ total assets by geographic location
United States	$	22,195,976	$	18,356,278	$	59,833,465	$	54,921,572	$	48,881,570	$	38,401,665
Canada	9,916,907		9,081,571		26,391,317		23,120,014		15,049,656		17,850,709
Europe	3,418,826		2,460,762		9,273,872		8,209,204		1,176,616		528,068
Rest of World	567,470		34,001		724,993		34,001		9,557,084		8,964,488
Total	$	36,099,179	$	29,932,612	$	96,223,647	$	86,284,791	$	74,664,926	$	65,744,930

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Shipping and Handling Costs

Shipping and handling costs are expensed as incurred and are included in selling and distribution expenses on the accompanying statement of operations. For the three months ended September 30, 2024 and 2023, shipping and handling expense was $288,657 and $176,077, respectively. For the nine months ended September 30, 2024 and 2023, shipping and handling expense was $804,388 and $490,161, respectively.

Share-based compensation

The Company accounts for share-based compensation in accordance with ASC 718, Compensation — Stock Compensation (“ASC 718”). In accordance with ASC 718, the Company determines whether an award should be classified and accounted for as a liability award or an equity award. All the Company’s share-based awards were classified as equity awards and are recognized in the consolidated financial statements based on their grant date fair values.

The Company has elected to recognize share-based compensation using the straight-line method for all share-based awards granted over the requisite service period, which is the vesting period. The Company accounts for forfeitures as they occur in accordance with ASC 718. The Company, with the assistance of an independent third-party valuation firm, determines the fair value of the stock options granted to employees. The Black Scholes Model is applied in determining the estimated fair value of the options granted to employees and non-employees. The Company recognized share-based compensation of $208,506 and $59,337 for the three months ended September 30, 2024 and 2023, respectively, and $536,597 and $331,893 for the nine months ended September 30, 2024 and 2023, respectively.

Income Taxes

Deferred taxes are recognized based on the future tax consequences of the differences between the carrying value of assets and liabilities and their respective tax bases. The future realization of deferred tax assets depends on the existence of sufficient taxable income in future periods. Possible sources of taxable income include taxable income in carryback periods, the future reversal of existing taxable temporary differences recorded as a deferred tax liability, tax-planning strategies that generate future income or gains in excess of anticipated losses in the carryforward period and projected future taxable income.

If, based upon all available evidence, both positive and negative, it is more likely than not (i.e., more than 50 percent likely) that such deferred tax assets will not be realized, a valuation allowance is recorded. Significant weight is given to positive and negative evidence that is objectively verifiable. A company’s three- year cumulative loss position is significant negative evidence in considering whether deferred tax assets are realizable, and the accounting guidance restricts the amount of reliance we can place on projected taxable income to support the recovery of the deferred tax assets.

The current accounting guidance allows the recognition of only those income tax positions that have a greater than 50 percent likelihood of being sustained upon examination by the taxing authorities. The Company believes that there is an increased potential for volatility in its effective tax rate because this threshold allows for changes in the income tax environment and, to a greater extent, the inherent complexities of income tax law in a substantial number of jurisdictions, which may affect the computation of its liability for uncertain tax positions.

The Company records interest and penalties on our uncertain tax positions in income tax expense.

As of September 30, 2024, the tax years ended December 31, 2020 through December 31, 2022 for FGI Industries remain open for statutory examination by tax authority.

We record the tax effects of Foreign Derived Intangible Income (FDII) and Global Intangible Low-Taxed Income (GILTI) related to our foreign operations as a component of income tax expense in the period in which the tax arises.

Non-controlling interests

The Company’s non-controlling interests represent the minority shareholders’ ownership interests related to the Company’s subsidiary, including 40% in Isla Porter LLC. The non-controlling interests are presented in the unaudited consolidated balance sheets, separate from equity attributable to the shareholders of the Company. Non-controlling interests in the results of operations of the Company are presented on the unaudited condensed consolidated statement of income and comprehensive income (loss) as allocations of the net income or loss for the period between non-controlling shareholders and the shareholders of the Company.

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Comprehensive income (loss)

Comprehensive income (loss) consists of two components: net income and other comprehensive income. Other comprehensive income (loss) refers to revenue, expenses, gains and losses that under U.S. GAAP are recorded as an element of equity but are excluded from net income. Other comprehensive income consists of a foreign currency translation adjustment resulting from the Company not using the U.S. Dollar as its functional currencies.

Earnings (loss) per share

The Company computes earnings (loss) per share (“EPS”) in accordance with ASC 260, “Earnings per Share” (“ASC 260”). ASC 260 requires companies to present basic and diluted EPS. Basic EPS is measured as net income divided by the weighted average ordinary shares outstanding for the period. Diluted EPS presents the dilutive effect on a per share basis of the potential ordinary shares (e.g., convertible securities, options and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential ordinary shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS.

The following table sets forth the computation of basic and diluted earnings per share for the three months ended September 30, 2024 and 2023:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Numerator:
Net (loss) income attributable to FGI Industries Ltd. shareholders	$	(550,137)	$	409,535	$	(798,761)	$	194,641

Denominator:
Weighted-average number of ordinary shares outstanding — basic	9,563,914		9,500,000		9,565,587		9,500,000
Potentially dilutive shares from outstanding options/warrants	—		286,522		—		322,847
Weighted-average number of ordinary shares outstanding — diluted	9,563,914		9,786,522		9,565,587		9,822,847

Earnings (loss) per share — basic	$	(0.06)	$	0.04	$	(0.08)	$	0.02
Earnings (loss) per share — diluted	$	(0.06)	$	0.04	$	(0.08)	$	0.02

Segment reporting

ASC 280, “Segment Reporting,” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for detailing the Company’s business segments.

Recently adopted accounting pronouncements

In November 2023, the Financial Accounting Standards Board (“FASB”) issued ASU 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures,” which requires additional disclosures regarding an entity’s reportable segments, particularly regarding significant segment expenses, as well as information relating to the chief operating decision maker. The amendments in this update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Company is currently evaluating the impact of this guidance and will adopt this guidance for the fiscal year ending December 31, 2024.

The Company considers the applicability and impact of all ASUs. ASUs not listed above were assessed and determined not to be applicable.

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Note 3 — Accounts receivable, net

Accounts receivable, net consisted of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Accounts receivable	$	20,377,488	$	17,184,706
Allowance for credit losses	(133,991)		(244,879)
Accrued defective return and discount	(1,234,259)		(744,284)
Accounts receivable, net	$	19,009,238	$	16,195,543

Movements of allowance for credit losses are as follows:


	For the Nine Months Ended September 30,		For the Year Ended December 31,
	2024		2023
	USD		USD

Beginning balance	$	244,879	$	438,843
Provision (recovery)	79,762		78,640
Write-off	(190,650)		(272,604)
Ending balance	$	133,991	$	244,879

Movements of accrued defective return and discount accounts are as follows:


	For the Nine Months Ended September 30,		For the Year Ended December 31,
	2024		2023
	USD		USD

Beginning balance	$	744,284	$	1,595,838
Provision (recovery)	489,975		(851,554)
Ending balance	$	1,234,259	$	744,284

Note 4 — Inventories, net

Inventories, net consisted of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Finished product	$	14,514,881	$	10,565,858
Reserves for slow-moving inventories	(729,372)		(642,006)
Inventories, net	$	13,785,509	$	9,923,852

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Movements of inventory reserves are as follows:


	For the Nine Months Ended September 30,		For the Year Ended December 31,
	2024		2023
	USD		USD

Beginning balance	$	642,006	$	663,530
Provision (recovery)	87,366		(21,524)
Ending balance	$	729,372	$	642,006

Note 5 — Prepayments and other assets

Prepayments and other assets consisted of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Prepayments	$	2,333,839	$	3,953,340
Others	256,368		664,411
Total prepayments and other assets	$	2,590,207	$	4,617,751

Note 6 — Property and equipment, net

Property and equipment, net consist of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Building	$	946,066	$	946,066
Leasehold Improvements	2,951,116		1,695,361
Machinery and equipment	1,694,957		1,613,439
Furniture and fixtures	278,578		259,449
Vehicles	147,912		147,912
Molds	26,377		26,377
Subtotal	6,045,006		4,688,604
Less: accumulated depreciation	(3,133,593)		(2,778,113)
Prepayment for purchase of equipment and construction-in-progress	45,818		—
Total	$	2,957,231	$	1,910,491

Depreciation expenses amounted to $125,244 and $56,497 for the three months ended September 30, 2024 and 2023 respectively, and $324,683 and $135,256 for the nine months ended September 30, 2024 and 2023, respectively. Depreciation expenses were included in general and administrative expenses on the unaudited condensed consolidated statements of operations and comprehensive (loss) income.

Note 7 — Leases

The Company has operating leases primarily for corporate offices, warehouses and showrooms. As of September 30, 2024, the Company’s leases have remaining lease terms up to 10.5 years.

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The Company also purchased an operating lease land from a common control affiliate for manufacturing, which has a remaining lease term up to 47.75 years and can be extended for another 50 years for $1.

For the three months ended September 30, 2024 and 2023, total lease expenses were $699,646 and $697,205, respectively. For the nine months ended September 30, 2024 and 2023, total lease expenses were $2,099,500 and $1,862,939, respectively.

The table below presents the operating lease related assets and liabilities recorded on the Company’s consolidated balance sheets:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Operating lease right-of-use assets	$	13,488,342	$	15,203,576
Operating lease liabilities – current	$	1,785,996	$	1,595,998
Operating lease liabilities – noncurrent	12,057,751		13,674,452
Total operating lease liabilities	$	13,843,747	$	15,270,450

Information relating to the lease term and discount rate are as follows:


	As of September 30, 2024		As of December 31, 2023

Weighted-average remaining lease term
Operating leases	9.0 years		9.4 years
Weighted-average discount rate
Operating leases	5.7	%	5.7	%

As of September 30, 2024, the maturities of operating lease liabilities were as follows:


For the 12 months ending September 30,
2025	$	2,538,099
2026	2,635,492
2027	2,650,249
2028	2,301,432
2029	1,682,400
Thereafter	5,765,659
Total lease payments	17,573,331
Less: imputed interest	(3,729,584)
Present value of lease liabilities	$	13,843,747

Note 8 — Short-term loans

Bank loan

Our wholly-owned subsidiary FGI Industries has a line of credit agreement (the “Credit Agreement”) with East West Bank, which is collateralized by all assets of FGI Industries and personally guaranteed by Liang Chou Chen, who holds approximately 49.89% of the voting control of Foremost. The current amount of maximum borrowings is $18,000,000 and the Credit Agreement has a maturity date of December 21, 2024. This is an assets-based line of credit, the borrowing limit is calculated based on certain percentage of accounts receivable and inventory balances.

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Pursuant to the Credit Agreement, FGI Industries is required to maintain (a) a debt coverage ratio (defined as earnings before interest, taxes, depreciation and amortization divided by current portion of long-term debt plus interest expense) of not less than 1.25 to 1, tested at the end of each fiscal quarter; (b) an effective tangible net worth (defined as total book net worth plus minority interest, less amounts due from officers, shareholders and affiliates, minus intangible assets and accumulated amortization, plus debt subordinated to East West Bank) of not less than $10,000,000, tested at the end of each fiscal quarter, on a consolidated basis; and (c) a total debt to tangible net worth ratio (defined as total liabilities divided by tangible net worth, which is defined as total book net worth plus minority interest, less loans to officers, shareholders, and affiliates minus intangible assets and accumulated amortization) not to exceed 4.0 to 1, tested at the end of each fiscal quarter, on a consolidated basis. As of September 30, 2024, FGI Industries was in compliance with these financial covenants.

The loan bears interest at rate equal to, at the Company’s option, either (i) 0.25 percentage points less than the Prime Rate quoted by the Wall Street Journal or (ii) the SOFR Rate (as administered by CME Group Benchmark Administration Limited and displayed by Bloomberg LP) plus 2.20% per annum (in either case, subject to a minimum rate of 4.500% per annum). The interest rate as of September 30, 2024, and December 31, 2023 was 7.75% and 8.25%, respectively.

Each sum of borrowings under the Credit Agreement is deemed due on demand and is classified as a short-term loan. The outstanding balance of such loan was $9,161,641 and $6,959,175 as of September 30, 2024, and December 31, 2023, respectively.

HSBC Canada Bank Loan / Foreign Exchange Facility

FGI Canada Ltd. has a line of credit agreement with HSBC Canada (the “Canadian Revolver”). The revolving line of credit with HSBC Canada allows for borrowing up to CAD7,500,000 (USD5,474,453 as of the September 30, 2024 exchange rate). This is an assets-based line of credit, the borrowing limit is calculated based on certain percentage of accounts receivable and inventory balances. Pursuant to the Canadian Revolver, FGI Canada Ltd. is required to maintain (a) a debt to tangible net worth ratio of no more than 3.00 to 1.00; and (b) a ratio of current assets to current liabilities of at least 1.25 to 1.00. The loan bears interest at a rate of Prime rate plus 0.50%. As of September 30, 2024, FGI Canada Ltd. was not in compliance with certain financial covenants in the Canadian Revolver related to its debt to tangible net worth ratio. As of the date of this quarterly report, FGI Canada Ltd. has requested a waiver from the lender, which is being processed by the lender. In the absence of an executed waiver, the Company has classified the outstanding balance of the loan as a current liability on the unaudited condensed consolidated balance sheet as of September 30, 2024. The Company has sufficient liquidity to repay the loan in full if immediate settlement were required.

Borrowings under this line of credit amounted to $1,026,392 and $0 as of September 30, 2024, and December 31, 2023, respectively. The facility matures at the discretion of HSBC Canada upon 60 days’ notice.

FGI Canada Ltd. also has a revolving foreign exchange facility with HSBC Canada of up to a permitted maximum of USD3,000,000. The advances are available to purchase foreign exchange forward contracts from time to time up to six months, subject to an overall maximum aggregate USD Equivalent outstanding face value not exceeding $3,000,000.

CTBC Credit Facility

On January 25, 2024, FGI International entered into an omnibus credit line (the “CTBC Credit Line”) with CTBC Bank Co., Ltd. (“CTBC”). Under the CTBC Credit Line, FGI International may borrow, from time to time, up to $2.3 million, with borrowings limited to 90% of FGI International’s export “open account” trade receivables. The CTBC Credit Line will bear interest at a rate of “Base Rate”, which is based on monthly or quarterly Taipei Interbank Offered in effect from time to time, plus 120 base points and handling fees, unless otherwise agreed to by the parties. The CTBC Credit Line is unsecured and is fully guaranteed by the Company and partially guaranteed by Liang Chou Chen. Borrowings under this line of credit amounted to $2,297,464 and $0 as of September 30, 2024 and December 31, 2023, respectively.

Note 9 — Shareholders’ Equity

FGI was incorporated in the Cayman Islands on May 26, 2021 in connection with the planned Reorganization, as described in Note 1. The Company is authorized to issue 50,000,000 ordinary shares with a par value of $0.001 per share.

On January 27, 2022, the Company completed the Reorganization upon the consummation of the initial public offering (“IPO”). After the Reorganization and the IPO, the Company’s authorized share capital is $21,000 divided into (i) 200,000,000 Ordinary Shares of par value of $0.0001 each, and (ii) 10,000,000 Preference Shares of par value of $0.0001 each; 9,500,000 ordinary shares were issued and outstanding accordingly. The Company believes it is appropriate to reflect

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these share issuances as nominal share issuances on a retroactive basis similar to a stock split pursuant to ASC 260. The Company has retroactively adjusted all shares and per share data for all the periods presented.

Initial Public Offering

On January 27, 2022, the Company consummated its IPO of 2,500,000 units (“Units”), each consisting of (i) one ordinary share, $0.0001 par value per share, of the Company (the “Shares”), and (ii) one warrant of the Company (the “Warrants”) entitling the holder to purchase one Share at an exercise price of $6.00 per Share. The Shares and Warrants were issued separately in the offering, and may be transferred separately immediately upon issuance. The Units were sold at a price of $6.00 per Unit. The Warrants included in the units were immediately exercisable following the consummation of the offering, have an exercise price equal to the initial public offering price, and expire five years from the date of issuance.

For the purposes of covering any over-allotments in connection with the distribution and sale of the Units, the Company granted a 45-day option to the underwriters to purchase (the “Over-allotment Option”), in the aggregate, up to 375,000 ordinary shares (the “Option Shares”) and Warrants to purchase up to 375,000 ordinary shares (the “Option Warrants”), which was exercisable in any combination of Option Shares and/or Option Warrants at the per Share purchase price and/or the per Warrant purchase price, respectively. On January 25, 2022, the underwriters exercised in full their option to purchase up to an additional 375,000 Warrants at the price of $0.01 per Option Warrant. Management determined that these Warrants meet the definition of a derivative under ASC 815-40; however, they fall under the scope exception, which states that contracts issued that both a) indexed to its own stock; and b) classified in shareholders' equity are not considered derivatives. The Warrants were recorded at their fair value on the date of grant as a component of equity.

The aggregated fair value of these Warrants on January 27, 2022 was $4.16 million. The fair value has been estimated using the Black-Scholes pricing model with the following weighted-average assumptions: market value of underlying stock of $1.448; risk free rate of 1.66%; expected term of five years; exercise price of the warrants of $6.00; volatility of 44.00%; and expected future dividends of $0. As of the date of this report, 2,875,000 warrants were issued and outstanding; and none of the warrants has been exercised.

The gross proceeds from the IPO were approximately $15.0 million with net proceeds of approximately $12.4 million, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by the Company. Immediately following the consummation of the IPO, there were an aggregate of 9,500,000 ordinary shares issued and outstanding. As a result of the IPO, the ordinary shares and Warrants now trade on the Nasdaq Capital Market under the symbol “FGI” and “FGIWW”, respectively.

Public Offering Warrants

In connection with and upon the closing of the IPO on January 27, 2022, the Company issued warrants equal to 2% of the Shares issued in the IPO, or 50,000 ordinary shares, to the representative of the underwriters for the IPO. The warrants carry a term of five years, shall not be exercisable for a period of 180 days from the closing of the IPO and shall be exercisable at a price equal to the IPO price per share. Management determined that these warrants meet the definition of a derivative under ASC 815-40; however, they fall under the scope exception, which states that contracts issued that are both a) indexed to its own stock; and b) classified in shareholders' equity are not considered derivatives. The warrants were recorded at their fair value on the date of grant as a component of equity.

The aggregated fair value of these IPO warrants on January 27, 2022 was $0.1 million. The fair value has been estimated using the Black-Scholes pricing model with the following weighted-average assumptions: market value of underlying stock of $1.448; risk free rate of 1.66%; expected term of five years; exercise price of the warrants of $6.00; volatility of 44.00%; and expected future dividends of $0. As of the date of this report, warrants exercisable for 50,000 shares were issued and outstanding; and none of the warrants have been exercised.

Note 10 — Stock-based compensation

2021 Equity Plan and Employee Stock Purchase Plan

On October 7, 2021, the board of directors adopted the 2021 Equity Incentive Plan (the “2021 Equity Plan”). The 2021 Equity Plan permits the grant of equity and equity-based incentive awards, including non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock awards, stock unit awards and other stock-based awards. The purpose of the 2021 Equity Plan is to attract and retain the best available personnel for positions of responsibility within the

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Company, to provide additional incentives to them to align their interests with those of the Company’s shareholders and to thereby promote the Company’s long-term business success.

On October 7, 2021, the board approved the adoption of the FGI Industries Ltd. Employee Stock Purchase Plan (the “ESPP”). The ESPP was approved by the Company’s shareholders on October 7, 2021, and became effective on the effective date of the Company’s consummation of the IPO of its ordinary shares. The ESPP offers eligible employees the opportunity to acquire a stock ownership interest in the Company through periodic payroll deductions that will be applied towards the purchase of ordinary shares at a discount from the then-current market price.

The board set the maximum aggregate number of ordinary shares reserved and available pursuant to the 2021 Equity Plan at 1,500,000 shares. The number of ordinary shares reserved for issuance under our 2021 Equity Plan will automatically increase on the first day of each year, commencing on January 1, 2022 and ending on (and including) January 1, 2031, in an amount equal to the lesser of (a) 4.5% of the total number of ordinary shares outstanding on December 31 of the immediately preceding calendar year, (b) 600,000 ordinary shares, or (c) such lesser number of shares as determined by the Board. The Equity Plan became effective on September 28, 2021.

The Company believes the options or awards granted contain an explicit service condition and/or performance condition. Under ASC 718-10-55-76, if the vesting (or exercisability) of an award is based on the satisfaction of both a service and performance condition, the entity must initially determine which outcomes are probable and recognize the compensation cost over the longer of the explicit or implicit service period. Because an initial public offering generally is not considered to be probable until the initial public offering is effective, no compensation cost was recognized until the IPO occurred.

Restricted shares units (“RSU”)

In January 2022, the Company issued 183,750 restricted share units (“RSUs”) to certain officers and employees under the 2021 Equity Plan as compensation awards. The fair value for these RSUs was $716,625 based on the closing share price of $3.90 as of January 27, 2022. These awards will vest in three equal installments on each anniversary of the grant date over three years. As of September 30, 2024, 122,500 of these granted RSUs were vested.

In April 2022, the Company issued 8,750 RSUs to an employee under the 2021 Equity Plan as compensation awards. The fair value for these RSUs was $22,050 based on the closing share price of $2.52 as of April 13, 2022. These awards will vest as to one-third of the shares on the one-year anniversary of the grant date. The remaining shares will vest in a series of 24 successive equal monthly installments upon completion of each additional month of service, commencing on the grant date. As of September 30, 2024, 7,049 of these granted RSUs were vested.

In May 2022, the Company issued 87,611 RSUs under the 2021 Equity Plan to Company officers to incentivize their performance and continue to align their interests with the Company’s shareholders. All these awards are subjected to performance conditions through December 31, 2024. The grant date fair value for these RSUs was $198,000 based on the closing share price of $2.26 as of May 11, 2022. If the maximum performance is met, the Company will issue an additional 43,805 RSUs under these awards with a grant date fair value of $99,000. As of September 30, 2024, all RSUs were canceled and none of them were vested.

In May 2022, the Company issued 16,363 RSUs to its independent directors under the 2021 Equity Plan as compensation award. All these awards are subjected to performance conditions through December 31, 2024. The fair value for these RSUs was $36,000 based on the closing share price of $2.20 as of May 17, 2022. As of September 30, 2024, none of these RSUs were vested.

In March 2023, the Company issued 96,635 RSUs under the 2021 Equity Plan to Company officers to incentivize their performance and continue to align their interests with the Company’s shareholders. All these awards are subjected to performance conditions through December 31, 2025. The grant date fair value for these RSUs was $201,000 based on the closing share price of $2.08 as of March 29, 2023. If the maximum performance is met, the Company will issue an additional 48,317 RSUs under these awards with a grant date fair value of $100,500. As of September 30, 2024, none of these RSUs were vested.

In March 2023, the Company issued 17,349 RSUs to its independent directors under the 2021 Equity Plan as compensation award. All these awards are subjected to performance conditions through December 31, 2025. The grant date fair value for these RSUs was $36,000 based on the closing share price of $2.08 as of March 29, 2023. As of September 30, 2024, 8,675 of these RSUs were vested.

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In March 2024, the Company issued 413,354 RSUs under the 2021 Equity Plan to the Company’s directors, officers and employees. All these awards are subjected to performance conditions through December 31, 2026. The grant date fair value for these RSUs was $620,031 based on the closing share price of $1.50 as of March 22, 2024. If the maximum performance is met, the Company will issue an additional 206,677 RSUs under these awards with a grant date fair value of $310,016. As of September 30, 2024, none of these RSUs were vested.

In April 2024, the Company issued 13,333 RSUs under the 2021 Equity Plan to one of the Company’s employees. This award is subject to performance obligations through December 31, 2024. The grant date fair value for these RSUs was $20,000 based on the closing share price of $1.50 as of April 1, 2024. If the maximum performance is met, the Company will issue an additional 6,667 RSUs under these awards with a grant date fair value of $10,000. As of September 30, 2024, none of these RSUs were vested.

The following is a summary of the restricted shares granted:


Restricted shares grants						Shares
Non-vested as of January 1, 2023						296,474
Granted						113,984
Vested						(66,111)
Canceled						(87,611)
Non-vested as of December 31, 2023						256,736
Granted						426,687
Vested						(72,112)
Canceled						—
Non-vested as of September 30, 2024						611,311

The following is a summary of the status of restricted shares as of September 30, 2024:


Outstanding Restricted Shares
Fair Value per share		Number	Average Remaining Amortization Period (Years)
$	3.90	61,250	0.33
$	2.52	1,701	0.50
$	2.20	16,363	0.25
$	2.08	96,635	1.50
$	2.08	8,675	1.50
$	1.50	413,354	2.50
$	1.50	13,333	0.25
		611,311

Share options (“Options”)

In March 2022, the Company issued 98,747 share options under the 2021 Equity Plan with an exercise price per share of $3.07 and a contractual life of 10 years to the Company’s executive officers and directors to incentivize their performance and continue to align their interests with the Company’s shareholders. The grant date fair value for these options was $141,401 determined using the Black-Scholes simplified method at the per option fair value of $1.43. All these options will vest as to one-third of the options on the one-year anniversary of the grant date. The remaining options will vest in a series of 24 successive equal monthly installments upon completion of each additional month of service. As of September 30, 2024, 82,289 of these granted options were vested.

In April 2022, the Company issued 97,371 share options under the 2021 Equity Plan with an exercise price per share of $2.52 and a contractual life of 10 years to the Company’s employees to incentivize their performance and continue to align their interests with the Company’s shareholders. The grant date fair value for these options was $114,972 determined using the Black-Scholes simplified method at the per option fair value of $1.18. All these options will vest as to one-third of the shares on the one-year anniversary of the grant date. The remaining options will vest in a series of 24 successive

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equal monthly installments upon completion of each additional month of service. As of September 30, 2024, 78,438 of these granted options were vested.

In May 2022, the Company issued 159,881 share options under the 2021 Equity Plan with an exercise price per share of $2.26 and a contractual life of 10 years to Company officers to incentivize their performance and continue to align their interests with the Company’s shareholders. The fair value for these options was $171,462 determined using the Black-Scholes simplified method at the per option fair value of $1.07. The number of options granted were subject to performance conditions through December 31, 2022, which could result in additional options awarded if maximum performance metrics were met. In addition to the performance criteria, the options vest as to one-third of the shares on the one-year anniversary of the grant date. The remaining options will vest in a series of 24 successive equal monthly installments upon completion of each additional month of service, commencing on the grant date. The options paid out at threshold under the performance metrics, and no additional options were awarded. As of September 30, 2024, 124,352 of these granted options were vested.

In March 2023, the Company issued 158,976 share options under the 2021 Equity Plan with an exercise price per share of $2.08 and a contractual life of 10 years to Company officers to incentivize their performance and continue to align their interests with the Company’s shareholders. The grant date fair value for these options was $201,000 determined using the Black-Scholes simplified method at the per option fair value of $1.26. All these options are subjected to performance conditions through December 31, 2023, which could result in additional options awarded if maximum performance metrics are met. In addition to the performance criteria, the options will vest as to one-third of the shares on the one-year anniversary of the grant date. The remaining options will vest in a series of 24 successive equal monthly installments upon completion of each additional month of service, commencing on the grant date. As of September 30, 2024, all options were canceled and none of them were vested.

In March 2024, the Company issued 529,635 share options under the 2021 Equity Plan with an exercise price per share of $1.50 and a contractual life of 10 years to Company officers to incentivize their performance and continue to align their interests with the Company’s shareholders. The grant date fair value for these options was $447,000 determined using the Black-Scholes simplified method at the per option fair value of $0.84. All these options are subjected to performance conditions through December 31, 2024, which could result in additional options awarded if maximum performance metrics are met. In addition to the performance criteria, the options will vest as to one-third of the shares on the one-year anniversary of the grant date. The remaining options will vest in a series of 24 successive equal monthly installments upon completion of each additional month of service, commencing on the grant date. As of September 30, 2024, none of these granted options were vested.

In April 2024, the Company issued 167,994 share options under the 2021 Equity Plan with an exercise price per share of $1.32 and a contractual life of 10 years to the Company’s employees to incentivize their performance and continue to align their interests with the Company’s shareholders. The grant date fair value for these options was $126,163 determined using the Black-Scholes simplified method at the per option fair value of $0.75. All these options will vest as to one-third of the shares on the one-year anniversary of the grant date. The remaining options will vest in a series of 24 successive equal monthly installments upon completion of each additional month of service. As of September 30, 2024, none of these granted options were vested.

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The options granted to employees are measured based on the grant date fair value of the equity instrument. They are accounted for as equity awards and contain service or performance vesting conditions. The following table summarizes the Company’s employee share option activities:


	Number of Options	Weighted Average Exercise Price	Weighted Average Grant Date Fair Value	Weighted Average Remaining Contractual Term	Average Intrinsic Value
		USD	USD	Years	USD
Share options outstanding at December 31, 2023	355,999	2.56	1.20	9.35	—
Granted	697,629	1.46	0.82	10.00	—
Forfeited	—	N/A	N/A	N/A	N/A
Exercised	—	N/A	N/A	N/A	N/A
Expired	—	N/A	N/A	N/A	N/A
Share options outstanding at September 30, 2024	1,053,628	1.83	0.95	8.84	—
Vested and exercisable at September 30, 2024	285,079	2.57	1.21	7.54	—

For the nine months ended September 30, 2024 and 2023, the total fair value of options awarded was $573,163 and $201,000, respectively.

The aggregate intrinsic value in the table above represents the difference between the exercise price of the awards and the fair value of the underlying Ordinary Shares at each reporting date, for those awards that had exercise price below the estimated fair value of the relevant Ordinary Shares.

Fair value of options

The Company used the Black-Scholes simplified method for the nine months ended September 30, 2024 and 2023. The assumptions used to value the options granted to employees were as follows:


	April 2024		March 2024		March 2023

Risk-free interest rate (%)	4.54		4.21		3.65
Expected volatility range (%)	55.32		55.11		63.36
Fair market value per ordinary share as at grant dates	$	1.32	$	1.50	$	2.08

The risk-free interest rate for periods within the contractual life of the options is based on the U.S. Treasury yield curve in effect at the time of grant for a term consistent with the contractual term of the awards. Expected volatility is estimated based on the volatility of ordinary shares or common stock of several comparable companies in the same industry. The expected exercise multiple is based on management’s estimation, which the Company believes is representative of the future.

The Company has elected to recognize share-based compensation expense using a straight-line method for all the employee equity awards granted with graded vesting based on service conditions, provided that the amount of compensation cost recognized at any date is at least equal to the portion of the grant date fair value of the equity awards that are vested at that date.

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The following table sets forth the amount of share-based compensation expense included in each of the relevant financial statement line items:


	For the Nine Months Ended September 30,
	2024		2023
	USD		USD
Selling and distribution expenses	$	116,584	$	93,746
General and administrative expenses	420,013		238,147
Total share-based compensation expenses	$	536,597	$	331,893

As of September 30, 2024, there was $1,280,193 in total unrecognized employee share-based compensation expense related to unvested options and RSUs, which may be adjusted for actual forfeitures occurring in the future. Total unrecognized compensation cost may be recognized over a weighted-average period of 2.14 years.

Note 11 — Income taxes

The source of pre-tax income and the components of income tax expense are as follows:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Income components
United States	$	(1,614,080)	$	(239,835)	$	(3,455,011)	$	(641,733)
Outside United States	1,183,369		755,843		2,186,900		1,166,922
Total pre-tax (loss) income	$	(430,711)	$	516,008	$	(1,268,111)	$	525,189
Provision for income taxes
Current
Federal	$	(12,757)	$	(6,062)	$	(12,219)	$	4,562
State	29,128		7,210		37,553		10,343
Foreign	502,214		223,979		831,959		524,776
	518,585		225,127		857,293		539,681
Deferred
Federal	(154,816)		(42,497)		(572,163)		(135,172)
State	(96,232)		(10,114)		(149,646)		(3,930)
Foreign	—		—		(144,073)		(3,988)
	(251,048)		(52,611)		(865,882)		(143,090)
Total provision for income taxes	$	267,537	$	172,516	$	(8,589)	$	396,591

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Reconciliations between taxes at the U.S. federal income tax rate and taxes at the Company’s effective income tax rate on earnings before income taxes are as follows:


	For the Nine Months Ended September 30,
	2024	2023
	%	%
Federal statutory rate	21.0	21.0
Increase (decrease) in tax rate resulting from:
State and local income taxes, net of federal benefit	6.1	(1.7)
Foreign operations	(16.2)	21.5
Permanent items	(10.8)	0.7
Deferred adjustments	(0.1)	2.1
Others	0.7	0.1
Effective tax rate	0.7	43.7

The following is a summary of the components of the net deferred tax assets and liabilities recognized in the consolidated balance sheets:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Deferred tax assets
Allowance for credit losses	$	31,996	$	58,476
Other reserve	108,814		61,371
Accrued expenses	146,771		143,823
Lease liability	1,541,398		1,769,328
Charitable contributions	8,306		8,181
Business interest limitation	519,320		242,862
Net operating loss – federal	602,265		310,099
Net operating loss – state	102,852		27,337
Other	195,389		66,063
Total deferred tax assets	3,257,111		2,687,540
Less: valuation allowance	—		—
Net deferred tax assets	3,257,111		2,687,540
Deferred tax liabilities
Fixed assets	1,471,219		1,728,364
Intangibles	(233,765)		(209,657)
Total deferred tax liabilities	1,237,454		1,518,707
Deferred tax assets, net of deferred tax liabilities	$	2,019,657	$	1,168,833

The deferred tax assets related to the Company’s net operating losses of $4,520,993 (Federal $2,867,922 and States $1,653,071) and $1,836,077 (Federal $1,476,655 and States $359,422) as of September 30, 2024 and December 31, 2023, respectively. The Federal Net Operating losses have no expiration date. The States Net Operating losses have either 20 years or no expiration date. The Company had no material unrecognized tax benefits at September 30, 2024 or, December 31, 2023. The Company has not taken any tax positions for which it is reasonably possible that unrecognized tax benefits will significantly increase within the next 12 months.

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Inflation Reduction Act of 2022

On August 16, 2022, the Inflation Reduction Act of 2022 (the “IR Act”) was signed into federal law. The IR Act provides for, among other things, a new U.S. federal 1% excise tax on certain repurchases of stock by publicly traded U.S. domestic corporations and certain U.S. domestic subsidiaries of publicly traded foreign corporations occurring on or after January 1, 2023. The excise tax is imposed on the repurchasing corporation itself, not its shareholders from which shares are repurchased. The amount of the excise tax is generally 1% of the fair market value of the shares repurchased at the time of the repurchase. However, for purposes of calculating the excise tax, repurchasing corporations are permitted to net the fair market value of certain new stock issuances against the fair market value of stock repurchases during the same taxable year. In addition, certain exceptions apply to the excise tax. The U.S. Department of the Treasury (the “Treasury”) has been given authority to provide regulations and other guidance to carry out and prevent the abuse or avoidance of the excise tax. There was no material impact of the IR Act on the Company’s consolidated financial statements.

Note 12 — Related party transactions and balances

Sales to a related party


Name of Related Party	Relationship	Nature of Transactions	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
			2024		2023		2024		2023
			USD		USD		USD		USD
Foremost Worldwide Co., Ltd.	An entity under common control	Sales	$	408,977	$	—	$	408,977	$	—
			$	408,977	$	—	$	408,977	$	—

Purchases from related parties


Name of Related Party	Relationship	Nature of Transactions	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
			2024		2023		2024		2023
			USD		USD		USD		USD
Focal Capital Holding Limited	An entity under common control	Purchase	$	1,903,797	$	980,910	$	4,658,602	$	5,950,640
Foremost Worldwide Co., Ltd.	An entity under common control	Purchase	1,883,192		717,188		5,837,250		1,755,577
Rizhao Foremost Woodwork Manufacturing Co., Ltd.	An entity under common control	Purchase	15,874		—		39,943		—
F.P.Z. Furniture (Cambodia) Co., Ltd.	An entity under common control	Purchase	—		575,060		—		575,060
Foremost Australasia Pty Ltd	An entity under common control	Purchase	—		413,339		—		413,339
			$	3,802,863	$	2,686,497	$	10,535,795	$	8,694,616

The ending balance of such transactions as of September 30, 2024 and December 31, 2023 are listed of the following:

Prepayments — related parties


Name of Related Party	As of September 30, 2024		As of December 31, 2023
	USD		USD

Focal Capital Holding Limited	$	12,043,142	$	6,658,498
Rizhao Foremost Woodwork Manufacturing Co., Ltd.	24,364		9,181
	$	12,067,506	$	6,667,679

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Accounts Payables — related parties


Name of Related Party	As of September 30, 2024		As of December 31, 2023
	USD		USD

Foremost Worldwide Co., Ltd.	$	5,053	$	735,308
	$	5,053	$	735,308

Shared Service and Miscellaneous expenses – related party

FGI Industries is party to the FHI Shared Services Agreement with FHI. Total amounts provided to FHI under the FHI Share Services Agreement were $189,081 and $178,249 for the three months ended September 30, 2024 and 2023, respectively, and $552,043 and $655,230 for the nine months ended September 30, 2024 and 2023, respectively, which were booked under selling and distribution expenses and administration expenses.

FGI is party to the Worldwide Shared Services Agreement with Foremost Worldwide. Total amounts provided from Foremost Worldwide under the Worldwide Shared Services Agreement were $82,908 and $72,408 for the three months ended September 30, 2024 and 2023, respectively, and $217,504 and $217,650 for the nine months ended September 30, 2024 and 2023, respectively.

Other Receivables (Payables) — related parties

Name of Related Party

Relationship

Nature of
Transactions

As of
September 30,
2024

As of
December 31,
2023

USD

Foremost Home Inc. (“FHI”)

An entity under common control

Shared services and Miscellaneous expenses

2,215,919

1,183,612

Foremost Worldwide Co., Ltd.

An entity under common control

Shared services and Miscellaneous expenses

(45,026)

(251,008)

Focal Capital Holding Limited

An entity under common control

Shared services and Miscellaneous expenses

(11,306)

—

F.P.Z. Furniture (Cambodia) Co., Ltd.

An entity under common control

Shared services and Miscellaneous expenses

(257,130)

—

1,902,457

932,604

Loan guarantee by a related party

Liang Chou Chen holds approximately 49.89% of the voting control of Foremost, the Company’s majority shareholder and is a guarantor of the loans under the Credit Agreement and under the CTBC Credit Line. See Note 8 for details.

Note 13 — Concentrations of risks

Credit risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash. The Federal Deposit Insurance Corporation pays compensation up to a limit of USD250,000 if the bank with which a depositor holds its eligible deposit fails. As of September 30, 2024, a cash balance of USD372,731 was maintained at financial institutions in the United States, of which USD93,835 was subject to credit risk. The Canadian Deposit Insurance Corporation pays compensation up to a limit of CAD100,000 (approximately USD73,000) if the bank with

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which an individual/a company holds its eligible deposit fails. As of September 30, 2024, a cash balance of CAD205,760 (USD150,190) was maintained at financial institutions in Canada, of which CAD105,760 (USD77,197) was subject to credit risk. The Taiwan Central Deposit Insurance Corporation pays compensation up to a limit of New Taiwan Dollar 3,000,000 (approximately USD93,000) if the bank with which an individual/a company holds its eligible deposit fails. As of September 30, 2024, an aggregated cash balance of USD1,535,430 was maintained at financial institutions in Taiwan, of which USD1,221,203 was subject to credit risk. The European Banking Authority pays compensation up to a limit of EUR100,000 (approximately USD112,000) if the bank with which an individual/a company holds its eligible deposit fails. As of September 30, 2024, cash balance of EUR366,827 (USD409,588) was maintained at financial institutions in Europe, of which EUR266,827 (USD297,931) was subject to credit risk. As of September 30, 2024, cash balance of USD142,166 was maintained at financial institutions in Kingdom of Cambodia, all of which was subject to credit risk. The Australian Prudential Regulation Authority pays compensation up to a limit of AUD250,000 (approximately USD172,592) if the bank with which an individual/a company holds its eligible deposit fails. As of September 30, 2024, cash balance of AUD292,986 (USD202,269) was maintained at financial institutions in Australia, of which AUD42,986 (USD29,676) was subject to credit risk. The Reserve Bank of India pays compensation up to a limit of INR500,000 (approximately USD5,973) if the bank with which an individual/a company holds its eligible deposit fails. As of September 30, 2024, cash balance of INR1,566,366 (USD18,712) was maintained at financial institutions in India, of which INR1,066,366 (USD12,739) was subject to credit risk. While management believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness.

The Company is also exposed to risk from its accounts receivable and other receivables. These assets are subjected to credit evaluations. An allowance has been made for estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment.

Customer concentration risk

For the three months ended September 30, 2024, two customers accounted for 19.5% and 15.1% of the Company’s total revenue, respectively. For the three months ended September 30, 2023, three customers accounted for 14.5%, 14.3% and 13.9% of the Company’s total revenue, respectively. No other customer accounted for more than 10% of the Company’s revenue for the three months ended September 30, 2024 and 2023.

For the nine months ended September 30, 2024, two customers accounted for 17.5% and 16.8% of the Company’s total revenue, respectively. For the nine months ended September 30, 2023, two customers accounted for 17.4% and 16.6% of the Company’s total revenue, respectively. No other customer accounted for more than 10% of the Company’s revenue for the nine months ended September 30, 2024 and 2023.

As of September 30, 2024, three customers accounted for 27.6%, 15.0% and 10.8% of the total balance of accounts receivable, respectively. As of December 31, 2023, four customers accounted for 27.2%, 19.0%, 12.0% and 11.1% of the total balance of accounts receivable, respectively. No other customer accounted for more than 10% of the Company’s accounts receivable as of September 30, 2024 and December 31, 2023.

Vendor concentration risk

For the three months ended September 30, 2024, Tangshan Huida Ceramic Group Co., Ltd (“Huida”) accounted for 57.3% of the Company’s total purchases, respectively. For the three months ended September 30, 2023, Huida accounted for 55.8% of the Company’s total purchases, respectively. No other supplier accounted for more than 10% of the Company’s total purchases for the three months ended September 30, 2024 and 2023.

For the nine months ended September 30, 2024, Tangshan Huida Ceramic Group Co., Ltd (“Huida”) accounted for 55.6% of the Company’s total purchases. For the nine months ended September 30, 2023, Huida and another vendor accounted for 54.5% and 10.1% of the Company’s total purchases, respectively. No other supplier accounted for more than 10% of the Company’s total purchases for the nine months ended September 30, 2024 and 2023.

As of September 30, 2024, Huida accounted for 72.0% of the total balance of accounts payable. As of December 31, 2023, Huida accounted for 71.4% of the total balance of accounts payable. No other supplier accounted for more than 10% of the Company’s accounts payable as of September 30, 2024 and December 31, 2023.

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Note 14 — Commitments and contingencies

Litigation

From time to time, the Company is involved in legal and regulatory proceedings that are incidental to the operation of its businesses. These proceedings may seek remedies relating to matters including environmental, tax, intellectual property, acquisitions or divestitures, product liability, property damage, personal injury, privacy, employment, labor and pension, government contract issues and commercial or contractual disputes. Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on present information, including management’s assessment of the merits of the particular claims, the Company does not believe it is reasonably possible that any asserted or unasserted legal claims or proceedings, individually or in aggregate, will have a material adverse effect on its results of operations or financial condition.

Note 15 — Segment information

The Company follows ASC 280, “Segment Reporting,” which requires that companies disclose segment data based on how management makes decisions about allocating resources to each segment and evaluating their performances. The Company has one reporting segment. The Company’s chief operating decision maker has been identified as the chief executive officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company, and hence the Company has only one reportable segment.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The disclosures in this Quarterly Report on Form 10-Q are complementary to those made in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 26, 2024 (the “2023 Form 10-K”). You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and related notes appearing in this Quarterly Report on Form 10-Q as well as our audited financial statements, notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our 2023 Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” section of this Quarterly Report on Form 10-Q and of our 2023 Form 10-K, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. All amounts in Management’s Discussion and Analysis of Financial Condition and Results of Operations are approximate.

Overview

FGI is a global supplier of kitchen and bath products. Over the course of 30 years, we have built an industry-wide reputation for product innovation, quality, and excellent customer service. We are currently focused on the following product categories: sanitaryware (primarily toilets, sinks, pedestals and toilet seats), bath furniture (vanities, mirrors and cabinets), shower systems, customer kitchen cabinetry and other accessory items. These products are sold primarily for R&R activity and, to a lesser extent, new home or commercial construction. We sell our products through numerous partners, including mass retail centers, wholesale and commercial distributors, online retailers and specialty stores.

Consistent with our long-term strategic plan, we intend to drive value creation for our shareholders through a balanced focus on product innovation, organic growth, and efficient capital deployment. The following initiatives represent key strategic priorities for us:

•Commitment to product innovation. We have a history of being an innovator in the kitchen and bath markets and developing “on-trend” products and bringing them to market ahead of the competition. We have developed deep marketing skills, leading design capabilities, and product development expertise. A recent example of our innovative product development includes the Jetcoat shower wall systems, which offer a stylized design option without the fuss of messy grout. We expect to continue to invest in research and development to drive product innovation in 2024.

•“BPC” (Brands, Products, Channels) strategy to drive above-market organic growth. We have continued to invest in our BPC strategy despite the market challenges, which is expected to drive improved organic growth in the longer term. We recently announced that we entered into a 5-year licensing agreement that will provide us access to an industry leading overflow toilet technology. We will continue to market this technology as FlushGuard Overflow Technology. During the fourth quarter of 2023, we were awarded product placements at several large customers, including two of the largest commercial distributors in North America. In addition, we continue to focus on our initiatives to expand geographically, with recently signed agreements providing entry into India, Eastern Europe and the UK.

•Enhanced margin performance. We generated gross margin of 27.7% in the first nine months of 2024, up from 26.7% in the same period last year, owing to the ongoing shift to higher margin products. During the remainder of 2024, we expect gross margins to remain consistent with those generated during fiscal year 2023.

•Efficient capital deployment. We will continue to prioritize capital deployment in support of organic growth opportunities, while continuing to evaluate strategic M&A opportunities. With total liquidity of $16.3 million as of September 30, 2024, the Company believes it has sufficient financial flexibility to fund its organic growth strategy.

•Deep manufacturing partners and customer relationships. We have developed strong manufacturing and sourcing partners over the last 30+ years, which we believe will continue to give us a competitive advantage in the markets we serve. We also have deep relationships with an established global customer base, offering end-to-end solutions to support category growth. While recent supply chain and inflation pressures have been a headwind, our durable partnerships with manufacturing and sourcing partners have helped to mitigate these challenges.

We were incorporated in the Cayman Islands on May 26, 2021 in connection with a reorganization (the “Reorganization”) of our parent company, Foremost Groups Ltd. (“Foremost”), and its affiliates, pursuant to which, among other actions, Foremost contributed all of its equity interests in FGI Industries Inc. (“FGI Industries”), FGI Europe

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Investment Limited, an entity formed in the British Virgin Islands, and FGI International, Limited, an entity formed under the laws of Hong Kong, each a wholly-owned subsidiary of Foremost, to the newly formed FGI Industries Ltd. Foremost was established in 1987 and has become a global leader in kitchen and bath design, indoor and outdoor furniture, food service equipment, and manufacturing. This discussion, and any financial information and results of operations discussed herein, refers to the assets, liabilities, revenue, expenses and cash flows that are directly attributable to the kitchen and bath business of Foremost before the completion of the Reorganization and are presented as if we had been in existence and the Reorganization had been in effect for the entirely of each of the periods presented.

Results of Operations

The following table summarizes the results of our operations for the three and nine months ended September 30, 2024 and 2023 and provides information regarding the dollar and percentage increase (decrease) during such periods.

For the Three and Nine Months Ended September 30, 2024 and 2023


	For the Three Months Ended September 30,				Change
	2024		2023		Amount		Percentage
					USD		%
Revenue	$	36,099,179	$	29,932,612	$	6,166,567	20.6
Cost of revenue	26,790,957		22,103,325		4,687,632		21.2
Gross profit	9,308,222		7,829,287		1,478,935		18.9
Selling and distribution expenses	6,284,932		4,572,593		1,712,339		37.4
General and administrative expenses	2,637,141		2,351,307		285,834		12.2
Research and development expenses	451,975		423,697		28,278		6.7
Income from operations	(65,826)		481,690		(547,516)		(113.7)
Operating margins (%)	(0.2)		1.6		(180)		bps
Total other (expenses) income, net	(364,885)		34,318		(399,203)		(1163.2)
Provision for income taxes	267,537		172,516		95,021		55.1
Net (loss) income	(698,248)		343,492		(1,041,740)		(303.3)
Net (loss) income attributable to FGI Industries Ltd. shareholders	(550,137)		409,535		(959,672)		(234.3)
Adjusted income from operations(1)	55,663		603,179		(547,516)		(90.8)
Adjusted operating margins (%)(1)	0.2		2.0		(180)		bps
Adjusted net (loss) income attributable to FGI Industries Ltd. shareholders(1)	$	(105,451)	$	588,791	$	(694,242)	(117.9)

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	For the Nine Months Ended September 30,				Change
	2024		2023		Amount		Percentage
	USD		USD		USD		%
Revenue	$	96,223,647	$	86,284,791	$	9,938,856	11.5
Cost of revenue	69,538,640		63,242,944		6,295,696		10.0
Gross profit	26,685,007		23,041,847		3,643,160		15.8
Selling and distribution expenses	18,676,665		14,084,200		4,592,465		32.6
General and administrative expenses	7,542,019		6,746,055		795,964		11.8
Research and development expenses	1,303,445		1,152,554		150,891		13.1
Income from operations	(837,122)		1,059,038		(1,896,160)		(179.0)
Operating margins (%)	(0.9)		1.2		(210)		bps
Total other expenses, net	(430,989)		(533,849)		102,860		(19.3)
(Benefit of) provision for income taxes	(8,589)		396,591		(405,180)		(102.2)
Net (loss) income	(1,259,522)		128,598		(1,388,120)		(1079.4)
Net (loss) income attributable to FGI Industries Ltd. shareholders	(798,761)		194,641		(993,402)		(510.4)
Adjusted (loss) income from operations(1)	(472,655)		1,473,506		(1,946,161)		(132.1)
Adjusted operating margins (%)(1)	(0.5)		1.7		(220)		bps
Adjusted net (loss) income attributable to FGI Industries Ltd. shareholders(1)	$	(280,227)	$	836,562	$	(1,116,789)	(133.5)

_________________________________________________

(1)See “Non-GAAP Measures” below for more information on our use of these adjusted figures and a reconciliation of these financial measures to their closest U.S. generally accepted accounting principles (“GAAP”) comparators.

Revenue

Our revenue increased by $6.2 million, or 20.6%, to $36.1 million for the three months ended September 30, 2024, from $29.9 million for the three months ended September 30, 2023. For the nine months ended September 30, 2024, our revenue increased by $9.9 million, or 11.5%, to $96.2 million from $86.3 million for the same period last year. The increase in our revenue was primarily driven by increases in sales of shower system, bath furniture and custom kitchen cabinetry.

Revenue categories by product are summarized as follow:


	For the Three Months Ended September 30,						Change
	2024		Percentage	2023		Percentage	Percentage
	USD		%	USD		%	%
Sanitaryware	$	21,451,387	59.4	$	20,740,380	69.3	3.4
Bath Furniture	4,162,291		11.5	2,531,430		8.5	64.4
Shower System	7,143,283		19.8	4,931,437		16.5	44.9
Others	3,342,218		9.3	1,729,365		5.7	93.3
Total	$	36,099,179	100.0	$	29,932,612	100.0	20.6

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	For the Nine Months Ended September 30,						Change
	2024		Percentage	2023		Percentage	Percentage
	USD		%	USD		%	%
Sanitaryware	$	59,303,663	61.6	$	54,949,082	63.7	7.9
Bath Furniture	11,282,623		11.7	12,304,688		14.3	(8.3)
Shower System	18,793,999		19.5	14,248,679		16.5	31.9
Others	6,843,362		7.2	4,782,342		5.5	43.1
Total	$	96,223,647	100.0	$	86,284,791	100.0	11.5

We derive the majority of our revenue from sales of sanitaryware, which accounted for 59.4% and 61.6% of our total revenue for the three and nine months ended September 30, 2024, compared to 69.3% and 63.7% for the comparable periods of 2023. Revenue generated from the sales of sanitaryware increased by 3.4% to $21.5 million for the three months ended September 30, 2024 from $20.7 million for same period of 2023. For the nine months ended September 30, 2024, this revenue increased by 7.9% to $59.3 million from $54.9 million for the same period of 2023. The increase in revenue was due, in part, by a reversal of delayed shipments in the prior quarter stemming from our transition to a new enterprise software system and ocean freight disruptions.

Our revenue from bath furniture sales accounted for 11.5% and 11.7% of our total revenue for the three and nine months ended September 30, 2024, compared to 8.5% and 14.3% for the comparable periods of 2023. Bath Furniture sales increased by 64.4% to $4.2 million for the three months ended September 30, 2024, compared to $2.5 million for the same period of 2023. For the nine months ended September 30, 2024, revenue from Bath Furniture sales decreased by 8.3% to $11.3 million from $12.3 million for the same period of 2023. Our recently launched mid-tier products to better address the current demand environment of trading down to lower priced offering is gaining traction.

Revenue from sales of Shower Systems made up approximately 19.8% and 19.5% of our total revenue for the three and nine months ended September 30, 2024, compared to 16.5% and 16.5% for the comparable periods of 2023. Revenue from sales of shower systems increased by 44.9% to $7.1 million for the three months ended September 30, 2024, compared to $4.9 million for the comparable period of 2023. For the nine months ended September 30, 2024, revenue from sales of shower systems increased by 31.9% to $18.8 million from $14.2 million for the same period of 2023. Our recently launched programs continue to have a positive impact during the third quarter.

Our revenue from sales of other products (custom kitchen cabinetry and other small offerings) increased by 93.3% to $3.3 million for the three months ended September 30, 2024, compared to $1.7 million for the same period of 2023. For the nine months ended September 30, 2024, other revenue increased by 43.1% to $6.8 million from $4.8 million for the same period of 2023. The increase was primarily driven by volume growth resulting from continued strength in sales of the Covered Bridge custom-kitchen cabinetry businesses.

Revenue Categories by Geographic Location

We derive our revenue primarily from the United States, Canada and Europe. Revenue categories by geographic location are summarized as follows:


	For the Three Months Ended September 30,						Change
	2024		Percentage	2023		Percentage	Percentage
	USD		%	USD		%	%
United States	$	22,195,976	61.5	$	18,356,278	61.3	20.9
Canada	9,916,907		27.5	9,081,571		30.3	9.2
Europe	3,418,826		9.5	2,460,762		8.2	38.9
Rest of World	567,470		1.5	34,001		0.2	1569.0
Total	$	36,099,179	100.0	$	29,932,612	100.0	20.6

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	For the Nine Months Ended September 30,						Change
	2024		Percentage	2023		Percentage	Percentage
	USD		%	USD		%	%
United States	$	59,833,465	62.2	$	54,921,572	63.7	8.9
Canada	26,391,317		27.4	23,120,014		26.8	14.1
Europe	9,273,872		9.6	8,209,204		9.5	13.0
Rest of World	724,993		0.8	34,001		—	2032.3
Total	$	96,223,647	100.0	$	86,284,791	100.0	11.5

We generated the majority of our revenue in the United States market, which amounted to $22.2 million for the three months ended September 30, 2024, compared to $18.4 million for the three months ended September 30, 2023, representing a 20.9% increase for the three-month periods. For the nine months ended September 30, 2024, however, revenue from United States market increased by 8.9% to $59.8 million, compared to $54.9 million for the same period of 2023. Such revenue accounted for 61.5% and 62.2% of our total revenue for the three and nine months ended September 30, 2024, respectively, compared to 61.3% and 63.7% for the three and nine months ended September 30, 2023, respectively. The increase in revenue was due, in part, by a reversal of delayed shipments in the prior quarter stemming from our transition to a new enterprise software system and ocean freight disruptions.

Our second largest market is Canada. Our revenue generated in the Canadian market was $9.9 million for the three months ended September 30, 2024, compared to $9.1 million for the three months ended September 30, 2023, representing a 9.2% increase. For the nine months ended September 30, 2024, revenue from Canadian market increased by 14.1% to $26.4 million, compared to $23.1 million for the same period in 2023. The increased sales in the Canada market were primarily driven by stabilized demand from wholesale customers.

We also derive revenue from Europe, which consists primarily of sales in Germany. This amounted to $3.4 million and $9.3 million for the three and nine months ended September 30, 2024, compared to $2.5 million and $8.2 million for the three and nine months ended September 30, 2023, representing a 38.9% and 13.0% increase for the three-month and nine-month periods, respectively.

Gross Profit

Gross profit was $9.3 million and $26.7 million for the three and nine months ended September 30, 2024, an increase of 18.9% and 15.8% compared to the same periods of 2023. Gross profit margin was 25.8% and 27.7% for the three and nine months ended September 30, 2024, down 40 and up 100 basis points from 26.2% and 26.7% for the three and nine months ended September 30, 2023, respectively.

Operating Expenses

Selling and distribution expenses primarily consisted of personnel costs, marketing and promotion costs, commission, and freight and leasing charges. Our selling and distribution expenses increased by $1.7 million, or 37.4%, to $6.3 million for the three months ended September 30, 2024, from $4.6 million for the three months ended September 30, 2023, and increased by $4.6 million, or 32.6%, to $18.7 million for the nine months ended September 30, 2024, from $14.1 million for the nine months ended September 30, 2023. The increase in selling and distribution expenses was largely attributable to increased personnel costs, marketing and promotion expenses and warehouse expenses as a result of inflation and our initiatives to drive sales growth.

General and administrative expenses primarily consisted of personnel costs, professional service fees, depreciation, travel, and office supply expenses. Our general and administrative expenses increased by $0.3 million, or 12.2%, to $2.6 million for the three months ended September 30, 2024, from $2.4 million for the three months ended September 30, 2023, and increased by $0.8 million, or 11.8%, to $7.5 million for the nine months ended September 30, 2024, from $6.7 million for the nine months ended September 30, 2023. The increase was primarily attributable to inflation and expenses incurred in connection with newly formed subsidiaries.

Research and development expenses mainly consisted of personnel costs and product development costs. Our research and development activities remained stable and are relatively immaterial to our unaudited condensed consolidated statements of operations and comprehensive (loss) income.

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Other Income (Expenses)

Other income (expenses) represents interest income and expenses, as well as non-recurring non-operating gains and losses. Other expenses, net decreased as a result of proceeds received from a settlement agreement and gains from foreign currency transactions.

Provision for Income Taxes

We recorded provision for income taxes of $0.3 million and benefit of income taxes of approximately $9,000 for the three and nine months ended September 30, 2024, and provision for income taxes of $0.2 million and $0.4 million for the three and nine months ended September 30, 2023. The fluctuation in effective tax rate was primarily driven by foreign operations with various tax rates and non-deductible items.

Net (Loss) Income

We incurred net loss of $0.7 million and net income of $0.3 million for the three months ended September 30, 2024 and 2023, respectively, and net loss of $1.3 million and net income of $0.1 million for the nine months ended September 30, 2024 and 2023, respectively. These changes had resulted from the combination of the changes discussed above.

Liquidity and Capital Resources

Our principal sources of liquidity are cash generated from operating activities and cash borrowed under credit facilities, which we believe provides sufficient liquidity to support our financing needs. As of September 30, 2024, we had cash and working capital of $3.0 million and $12.7 million, respectively. During the nine months ended September 30, 2024, we drew an aggregate of approximately $5.5 million on the Credit Agreement, the Canadian Revolver and the CTBC Credit Line for working capital replenishment.

We believe our revenue and operations will continue to grow and the current working capital is sufficient to support our operations and debt obligations well into the foreseeable future. However, we may need additional cash resources in the future if we experience changes in business conditions or other developments, such as rising interest rates, inflation and increased costs, and may also need additional cash resources in the future if we wish to pursue opportunities for investment, acquisition, strategic cooperation or other similar actions. For example, from time to time we may provide loans or other operational support to Foremost to assist Foremost in capital expenditures or other efforts related to the manufacturing services that Foremost provides to us, which could limit the assets available for other corporate purposes or require additional resources. If it is determined that the cash requirements exceed our amount of cash on hand, we may seek to issue debt or equity securities, and there can be no assurances that additional financing will be available on acceptable term, if at all.

As of September 30, 2024, FGI’s total outstanding debt consisted of the Credit Agreement with East West Bank and the CTBC Credit Line with CTBC Bank (each discussed below).

East West Bank Credit Facility

Our wholly owned subsidiary, FGI Industries, has a line of credit with East West Bank pursuant to a Business Loan Agreement (the “Credit Agreement”) with East West Bank, which is collateralized by all of the assets of FGI Industries and personally guaranteed by Liang Chou Chen, who holds approximately 49.89% of the voting control of Foremost. On November 25, 2022, the Credit Agreement was amended and restated with a maximum borrowing amount of $18,000,000 and a maturity date of December 21, 2024.

Pursuant to the Credit Agreement, FGI Industries is required to maintain (a) a debt coverage ratio (defined as earnings before interest, taxes, depreciation and amortization divided by current portion of long-term debt plus interest expense) of not less than 1.25 to 1, tested at the end of each fiscal quarter; (b) an effective tangible net worth (defined as total book net worth plus minority interest, less amounts due from officers, shareholders and affiliates, minus intangible assets and accumulated amortization, plus debt subordinated to East West Bank) of not less than $10,000,000 for the quarter ended June 30, 2021 and thereafter, on a consolidated basis; and (c) a total debt to tangible net worth ratio (defined as total liabilities divided by tangible net worth, which is defined as total book net worth plus minority interest, less loans to officers, shareholders, and affiliates minus intangible assets and accumulated amortization) not to exceed 4.0 to 1, tested at the end of each fiscal quarter, on a consolidated basis. As of September 30, 2024, FGI Industries was in compliance with this financial covenant. As described in Item 1. Note 8, FGI Industries is also required to provide the lender with certain

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periodic financial information, including annual audited financial statements of FGI Industries on a non-consolidated basis. As of the date of this report, FGI Industries has obtained a waiver for such Corporate Borrower’s Audited Annual Statements, a U.S. standalone reporting obligation under the Credit Agreement, which were due by April 30, 2024.

The loan bears interest rate equal to, at the Company’s option, either (i) 0.25 percentage points less than the Prime Rate quoted by the Wall Street Journal or (ii) the SOFR Rate (as administered by CME Group Benchmark Administration Limited and displayed by Bloomberg LP) plus 2.20% per annum (in either case, subject to a minimum rate of 4.500% per annum). The interest rate as of September 30, 2024 and December 31, 2023 was 7.75% and 8.25%, respectively.

HSBC Canada Bank Loan

FGI Canada Ltd. has a line of credit agreement with HSBC Canada (the “Canadian Revolver”). The revolving line of credit with HSBC Canada allows for borrowing up to CAD7,500,000 (USD5,474,453 as of September 30, 2024). This is an assets-based line of credit, the borrowing limit is calculated based on certain percentage of accounts receivable and inventory balances. Pursuant to the Canadian Revolver, FGI Canada Ltd. is required to maintain (a) a debt to tangible net worth ratio of no more than 3.00 to 1.00; and (b) a ratio of current assets to current liabilities of at least 1.25 to 1.00. The loan bears interest at a rate of Prime rate plus 0.50%. As of September 30, 2024, FGI Canada Ltd. was not in compliance with certain financial covenants in the Canadian Revolver related to its debt to tangible net worth ratio. As of the date of this quarterly report, FGI Canada Ltd. has requested a waiver from the lender, which is being processed by the lender. In the absence of an executed waiver, the Company has classified the outstanding balance of the loan as a current liability on the unaudited condensed consolidated balance sheet as of September 30, 2024. The Company has sufficient liquidity to repay the loan in full if immediate settlement were required.

Borrowings under this line of credit amounted to $1,026,392 and $0 as of September 30, 2024 and December 31, 2023, respectively. The facility matures at the discretion of HSBC Canada upon 60 days’ notice.

FGI Canada Ltd. also has a revolving foreign exchange facility up to a permitted maximum of USD3,000,000. The advances are available to purchase foreign exchange forward contracts from time to time up to six months, subject to an overall maximum aggregate USD Equivalent outstanding face value not exceeding the Foreign Exchange Facility Limit.

CTBC Credit Facility

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The following table summarizes the key components of our cash flows for the nine months ended September 30, 2024 and 2023.


	For the Nine Months Ended September 30,
	2024		2023
	USD		USD
Net cash used in operating activities	$	(8,042,745)	$	(1,986,964)
Net cash used in investing activities	(2,044,264)		(883,054)
Net cash provided by (used in) financing activities	5,526,322		(1,832,849)
Effect of exchange rate fluctuation on cash	(171,892)		5,386
Net changes in cash	(4,732,579)		(4,697,481)
Cash, beginning of period	7,777,241		10,067,428
Cash, end of period	$	3,044,662	$	5,369,947

Operating Activities

Net cash used in operating activities was approximately $8.0 million for the nine months ended September 30, 2024 and was primarily attributable to an increase in prepayments and other receivables - related parties of approximately $6.0 million, an increase in inventories of approximately $3.9 million, an increase in accounts receivable of approximately $3.8 million, a decrease in operating lease liabilities of approximately $1.4 million, net loss of $1.3 million, a decrease in accounts payable - related parties of approximately $0.7 million, and an increase in other noncurrent assets of approximately $0.6 million. These drivers were partially offset by non-cash items of $2.2 million, an increase in accounts payable of approximately $5.7 million, an increase in accrued expenses and other current liabilities of approximately $1.1 million, and a decrease in prepayments and other current assets of approximately $0.8 million.

Net cash used in operating activities was approximately $2.0 million for the nine months ended September 30, 2023 and was primarily attributable to an increase in prepayments and other receivables - related parties of approximately $5.4 million, an increase in accounts receivable of approximately $1.6 million, an increase in prepayments and other current assets of approximately $1.3 million, a decrease in operating lease liabilities of approximately $0.9 million, and a decrease in accounts payable of approximately $0.7 million. These drivers were partially offset by non-cash items of $0.9 million, a decrease in inventories of approximately $3.7 million, an increase in accounts payable - related parties of approximately $2.4 million, and a decrease in other noncurrent assets of $0.6 million.

Investing Activities

Net cash used in investing activities was $2.0 million and $0.9 million for the nine months ended September 30, 2024 and 2023, respectively, which was attributable to the purchases of property and equipment and intangible assets.

Financing Activities

Net cash provided by financing activities was approximately $5.5 million for the nine months ended September 30, 2024 which represents net proceeds from bank loans.

Net cash used in financing activities was approximately $1.8 million for the nine months ended September 30, 2023, which represents net repayment of bank loans.

Commitments and Contingencies

Capital Expenditures

Our capital expenditures were incurred primarily in connection with the acquisition of property and equipment. Our capital expenditures amounted to $2.0 million and $0.9 million for the nine months ended September 30, 2024 and 2023, respectively. We do not expect to incur significant capital expenditures in the immediate future.

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Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements including arrangements that would affect our liquidity, capital resources, market risk support and credit risk support or other benefits.

Critical Accounting Policies and Significant Accounting Estimates

A discussion of our critical accounting policies and significant accounting estimates is included in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2023 Form 10-K. The preparation of the unaudited condensed consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of some assets and liabilities and, in some instances, the reported amounts of revenue and expenses during the applicable reporting period. Actual results could differ materially from these estimates. Changes in estimates are recorded in results of operations in the period that the events or circumstances giving rise to such changes occur. Within the context of these critical accounting estimates, we are not currently aware of any reasonably likely events or circumstances that would result in different policies or estimates being reported for the nine months ended September 30, 2024.

Recently Issued Accounting Pronouncements

See Note 2, “Summary of significant accounting policies” in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Non-GAAP Measures

In addition to the measures presented in our unaudited condensed consolidated financial statements, we use the following non-GAAP measures to evaluate our business, measure our performance, identify trends affecting our business and assist us in making strategic decisions. Our non-GAAP measures are: Adjusted Income from Operations, Adjusted Operating Margins and Adjusted Net Income. These non-GAAP financial measures are not prepared in accordance with GAAP. They are supplemental financial measures of our performance only, and should not be considered substitutes for net income, income from operations or any other measure derived in accordance with GAAP and may not be comparable to similarly titled measures reported by other entities.

We define Adjusted Income from Operations as GAAP income from operations excluding the impact of certain non-recurring expenses, including IPO-related compensation (cash and stock-based), legal fees and business expansion expenses. We define Adjusted Net Income as GAAP income before income taxes excluding the impact of certain non-recurring expenses and income, such as IPO-related compensation, legal fees and business expansion expenses, income taxes at historical average effective rate, as well as net income attributable to non-controlling shareholders. We define Adjusted Operating Margins as adjusted income from operations divided by revenue.

We use these non-GAAP measures, along with GAAP measures, to evaluate our business, measure our financial performance and profitability and our ability to manage expenses, after adjusting for certain one-time expenses, identify trends affecting our business and assist us in making strategic decisions. We believe these non-GAAP measures, when reviewed in conjunction with GAAP financial measures, and not in isolation or as substitutes for analysis of our results of operations under GAAP, are useful to investors as they are widely used measures of performance and the adjustments we make to these non-GAAP measures provide investors further insight into our profitability and additional perspectives in comparing our performance over time on a consistent basis.

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The following table reconciles Income from Operations to Adjusted Income from Operations and Adjusted Operating Margins, as well as Net income to Adjusted Net Income for the periods presented.


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
(Loss) income from operations	$	(65,826)	$	481,690	$	(837,122)	$	1,059,038
Adjustments:
Non-recurring IPO-related stock-based compensation	59,719		59,719		179,157		179,156
IPO and arbitration legal fee	—		—		—		50,000
Business expansion expense	61,770		61,770		185,310		185,312
Adjusted (loss) income from operations	$	55,663	$	603,179	$	(472,655)	$	1,473,506
Revenue	$	36,099,179	$	29,932,612	$	96,223,647	$	86,284,791
Adjusted operating margins (%)	0.2		2.0		(0.5)		1.7


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
(Loss) income before income taxes	$	(430,711)	$	516,008	$	(1,268,111)	$	525,189
Adjustments:
Non-recurring IPO-related stock-based compensation	59,719		59,719		179,157		179,156
IPO and arbitration legal fee	—		—		—		50,000
Business expansion expense	61,770		61,770		185,310		185,312
Adjusted (loss) income before income taxes	(309,222)		637,497		(903,644)		939,657
Less: income taxes at 18% rate	(55,660)		114,749		(162,656)		169,138
Less: net loss attributable to non-controlling shareholders	(148,111)		(66,043)		(460,761)		(66,043)
Adjusted net (loss) income	$	(105,451)	$	588,791	$	(280,227)	$	836,562

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not required for smaller reporting companies.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), means our controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by our company in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officer, to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)) under the Exchange Act, as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, our Chief

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Executive Officer and Chief Financial Officer have concluded that as of September 30, 2024, our disclosure controls and procedures were not effective.

Evaluation of the Effectiveness of Internal Control over Financial Reporting

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) or 15d-15(e) of the Exchange Act) as of September 30, 2024. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were not effective as of September 30, 2024 because of the material weakness in our internal control over financial reporting described below.

Identified Material Weakness

Management noted that there is an inadequate segregation of duties related to certain accounting functions due to the size of the Company’s subsidiaries. In addition, the Company lacks evidence of management review controls activity taking place, such as but not limited to, the review and approval of journal entries and account reconciliations.

Accordingly, the Company concluded that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis by the Company’s internal controls.

Management’s Remediation Initiatives

As of September 30, 2024, and through the date of this filing we are in the process of implementing segregation of duties and are determining further initiatives to undertake in order to remediate this remaining material weakness and anticipate that these initiatives will be implemented by the end of fiscal year 2024.

Changes in Internal Control over Financial Reporting

Other than as described above, there have been no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II- OTHER INFORMATION

Item 1. Legal Proceedings.

We may be subject to legal proceedings and claims in the ordinary course of business. We cannot predict the results of any such disputes, and despite the potential outcomes, the existence thereof may have an adverse material impact on us due to diversion of management time and attention as well as the financial costs related to resolving such disputes.

Ayers Bath Litigation

As previously disclosed, FGI Industries (formerly known as Foremost Groups, Inc.), our wholly-owned subsidiary, was involved in litigation arising from its efforts to protect an exclusivity agreement with sanitaryware manufacturer Tangshan Huida Ceramic Group Co., Ltd. (“Huida”) through the second quarter of 2024. In June 2024, the parties entered into a settlement agreement with a mutual release of all claims related to the litigation. The settlement amount is reflected in other income (expenses), net.

Item 1A. Risk Factors.

Our Annual Report on Form 10-K for the year ended December 31, 2023, includes a detailed discussion of our risk factors. At the time of this filing, except as provided below, there have been no material changes to the risk factors that were included in the Form 10-K.

If we fail to meet Nasdaq’s continued listing requirements, it could result in a delisting of our ordinary shares.

If we fail to satisfy the continued listing requirements of Nasdaq, such as the corporate governance requirements or the minimum closing bid price requirement, Nasdaq may take steps to delist our common stock. Under the Nasdaq Marketplace Rules, if the bid price of our common stock were to close below the required minimum $1.00 per share for 30 consecutive business days, we may receive a deficiency notice from Nasdaq regarding our failure to comply with Nasdaq

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Marketplace Rule 5550(a)(2). If we receive such a notice, pursuant to Marketplace Rule 5810(c)(3)(A), we may become subject to a period of 180 calendar days to regain compliance with Rule 5550(a)(2). If at any time the bid price of our common stock closes at $1.00 per share or more for a minimum of 10 consecutive business days, we will regain compliance with Rule 5550(a)(2).

The per share price of our ordinary shares has fluctuated significantly and has been below $1.00 per share. Our stock price may not close at or above $1.00 per share and if the price remains below $1.00 per share, our stock could become subject to delisting. Such a delisting would likely have a negative effect on the price of our common stock and would impair your ability to sell or purchase our common stock when you wish to do so. In the event of a delisting, we can provide no assurance that any action taken by us to restore compliance with listing requirements would allow our common stock to become listed again, stabilize the market price or improve the liquidity of our common stock, prevent our common stock from dropping below the Nasdaq minimum bid price requirement or prevent future non-compliance with the listing requirements of Nasdaq.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Use of Proceeds from Initial Public Offering

On January 27, 2022, we closed our initial public offering (“IPO”) of 2,500,000 units (“Units”), each consisting of (i) one ordinary share, $0.0001 par value per share (the “Shares”), and (ii) one warrant (the “Warrants”) entitling the holder to purchase one Share at an exercise price of $6.00 per Share. The Warrants are immediately exercisable upon issuance and are exercisable for a period of five years after the issuance date. The Shares and Warrants were issued separately in the IPO, and may be transferred separately immediately upon issuance. The underwriters exercised in full their option to purchase up to an additional 375,000 Warrants. The Units were sold at a price of $6.00 per Unit, and the net proceeds from the IPO were approximately $12.4 million, after deducting underwriting discounts and commissions of approximately $1.1 million and offering expenses of approximately $1.5 million payable by us. No payments for such expenses were made directly or indirectly to (i) any of our officers or directors or their associates, (ii) any persons owning 10% or more of any class of our equity securities or (iii) any of our affiliates.

In connection with the IPO, we issued to the representative of the underwriters a warrant to purchase an aggregate of 50,000 Shares. The Benchmark Company acted as lead book-running manager, and Northland Capital Markets acted as joint book-running manager. The offer and sale of the shares were registered under the Securities Act of 1933, as amended (the “Securities Act”) on a Registration Statement on Form S-1 (File No. 333-259457), which was declared effective on January 24, 2022.

There has been no material change in the expected use of the net proceeds from our IPO as described in our final prospectus, dated January 24, 2022, filed with the SEC on January 26, 2022, pursuant to Rule 424(b) of the Securities Act and our Post-Effective Amendment No.1 to Form S-1 filed on April 7, 2022.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

Trading Plans

During the nine months ended September 30, 2024, no director or executive officer adopted, modified or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement", as each term is defined in Item 408(a) of Regulation S-K.

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Item 6. Exhibits.


Exhibit Number						Description

3.1						Second Amended and Restated Memorandum and Articles of Association of FGI Industries Ltd., effective January 27, 2022 (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K filed on January 27, 2022).

31.1						Rule 13(a)-14(a)/15(d)-14(a) Certification of Principal Executive Officer.

31.2						Rule 13(a)-14(a)/15(d)-14(a) Certification of Principal Financial Officer.

32.1						Section 1350 Certification of Principal Executive Officer and Principal Financial Officer.

101						The following material from FGI Industries Ltd.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024, formatted in Inline XBRL (Inline Extensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheets; (ii) the Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income; (iii) the Condensed Consolidated Statements of Changes in Shareholders’ Equity; (iv) the Condensed Consolidated Statements of Cash Flows; and (v) Notes to Unaudited Condensed Consolidated Financial Statements. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

104						Cover Page Interactive Data File formatted in Inline XBRL and contained in Exhibit 101.

_________________________________________________

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Dated: November 13, 2024


FGI Industries Ltd.

By:			/s/ David Bruce
			David Bruce
			Chief Executive Officer
			(Principal Executive Officer)

By:			/s/ Perry Lin
			Perry Lin
			Chief Financial Officer
			(Principal Financial and Accounting Officer)

EXHIBIT 31.1

RULE 13a-14(a)/15d-14(a) CERTIFICATION

I, David Bruce, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of FGI Industries Ltd.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

(a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)N/A;

(c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: November 13, 2024						/s/ David Bruce
						David Bruce
						Chief Executive Officer
						(Principal Executive Officer)

EXHIBIT 31.2

RULE 13a-14(a)/15d-14(a) CERTIFICATION

I, Perry Lin, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of FGI Industries Ltd.;

(b)N/A;

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: November 13, 2024						/s/ Perry Lin
						Perry Lin
						Chief Financial Officer
						(Principal Financial Officer and Principal Accounting Officer)

EXHIBIT 32.1

CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(18 U.S.C. SECTION 1350)

In connection with the Quarterly Report of FGI Industries Ltd. (the “Company”) on Form 10-Q for the period ended September 30, 2024, to which this certification is being filed as of the date hereof as an exhibit thereto (the “Report”), I, David Bruce, Chief Executive Officer of the Company, and I, Perry Lin, Chief Financial Officer of the Company, each certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(a)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (15 U.S.C. 78m or 78o(d)); and

(b)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: November 13, 2024


/s/ David Bruce
David Bruce
Chief Executive Officer
(Principal Executive Officer)


/s/ Perry Lin
Perry Lin
Chief Financial Officer
(Principal Financial Officer and Principal Accounting Officer)

Cover - shares	9 Months Ended
Cover - shares	Sep. 30, 2024	Nov. 05, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2024
Document Transition Report	false
Entity File Number	001-41207
Entity Registrant Name	FGI Industries Ltd.
Entity Incorporation, State or Country Code	E9
Entity Tax Identification Number	98-1603252
Entity Address, Address Line One	906 Murray Road
Entity Address, City or Town	East Hanover
Entity Address, State or Province	NJ
Entity Address, Postal Zip Code	07936
City Area Code	973
Local Phone Number	428-0400
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		9,563,914
Entity Central Index Key	0001864943
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q3
Amendment Flag	false
Ordinary Shares
Document Information [Line Items]
Title of 12(b) Security	Ordinary Shares, $0.0001 par value
Trading Symbol	FGI
Security Exchange Name	NASDAQ
Warrant
Document Information [Line Items]
Title of 12(b) Security	Warrants to purchase Ordinary Shares, $0.0001 par value
Trading Symbol	FGIWW
Security Exchange Name	NASDAQ

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Sep. 30, 2024	Dec. 31, 2023
CURRENT ASSETS
Cash	$ 3,044,662	$ 7,777,241
Accounts receivable, net	19,009,238	16,195,543
Inventories, net	13,785,509	9,923,852
Total current assets	52,399,579	46,114,670
PROPERTY AND EQUIPMENT, NET	2,957,231	1,910,491
OTHER ASSETS
Intangible assets	1,927,330	102,227
Operating lease right-of-use assets, net	13,488,342	15,203,576
Deferred tax assets, net	2,019,657	1,168,833
Other noncurrent assets	1,872,787	1,245,133
Total other assets	19,308,116	17,719,769
Total assets	74,664,926	65,744,930
CURRENT LIABILITIES
Short-term loans	12,485,497	6,959,175
Income tax payable	64,750	189,119
Operating lease liabilities – current	1,785,996	1,595,998
Accrued expenses and other current liabilities	5,134,193	4,039,499
Total current liabilities	39,703,617	28,043,706
OTHER LIABILITIES
Operating lease liabilities – noncurrent	12,057,751	13,674,452
Total liabilities	51,761,368	41,718,158
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY
Preference Shares ($0.0001 par value, 10,000,000 shares authorized, no shares issued and outstanding as of September 30, 2024 and December 31, 2023)	0	0
Ordinary shares ($0.0001 par value, 200,000,000 shares authorized, 9,563,914 and 9,547,607 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively)	956	955
Additional paid-in capital	21,414,428	20,877,832
Retained earnings	3,614,763	4,413,524
Accumulated other comprehensive loss	(1,511,788)	(1,111,499)
FGI Industries Ltd. shareholders’ equity	23,518,359	24,180,812
Non-controlling interests	(614,801)	(154,040)
Total shareholders’ equity	22,903,558	24,026,772
Total liabilities and shareholders’ equity	74,664,926	65,744,930
Nonrelated Party
CURRENT ASSETS
Prepayments and other current assets	2,590,207	4,617,751
CURRENT LIABILITIES
Accounts payable	20,228,128	14,524,607
Related Party
CURRENT ASSETS
Prepayments and other current assets	13,969,963	7,600,283
CURRENT LIABILITIES
Accounts payable	$ 5,053	$ 735,308

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2024	Dec. 31, 2023
Preference shares
Preference shares, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preference shares, authorized (in shares)	10,000,000	10,000,000
Preferred shares, shares issued (in shares)	0	0
Preferred shares, shares outstanding (in shares)	0	0
Ordinary shares
Ordinary shares, par value (in dollars per share)	$ 0.0001	$ 0.0001
Ordinary shares, authorized (in shares)	200,000,000	200,000,000
Ordinary shares, issued (in shares)	9,563,914	9,547,607
Ordinary shares, outstanding (in shares)	9,563,914	9,547,607

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Statement of Comprehensive Income [Abstract]
Revenue	$ 36,099,179	$ 29,932,612	$ 96,223,647	$ 86,284,791
Cost of revenue	26,790,957	22,103,325	69,538,640	63,242,944
Gross profit	9,308,222	7,829,287	26,685,007	23,041,847
Operating expenses
Selling and distribution	6,284,932	4,572,593	18,676,665	14,084,200
General and administrative	2,637,141	2,351,307	7,542,019	6,746,055
Research and development	451,975	423,697	1,303,445	1,152,554
Total operating expenses	9,374,048	7,347,597	27,522,129	21,982,809
(Loss) income from operations	(65,826)	481,690	(837,122)	1,059,038
Other income (expenses)
Interest income	584	1,102	5,251	6,524
Interest expense	(366,420)	(16,382)	(893,721)	(559,730)
Other income, net	951	49,598	457,481	19,357
Total other (expenses) income, net	(364,885)	34,318	(430,989)	(533,849)
(Loss) income before income taxes	(430,711)	516,008	(1,268,111)	525,189
Provision for (benefit of) income taxes
Current	518,585	225,127	857,293	539,681
Deferred	(251,048)	(52,611)	(865,882)	(143,090)
Total provision for (benefit of) income taxes	267,537	172,516	(8,589)	396,591
Net (loss) income	(698,248)	343,492	(1,259,522)	128,598
Less: net loss attributable to non-controlling shareholders	(148,111)	(66,043)	(460,761)	(66,043)
Net (loss) income attributable to FGI Industries Ltd. shareholders	(550,137)	409,535	(798,761)	194,641
Other comprehensive income (loss)
Foreign currency translation adjustment	47,269	(44,497)	(400,289)	(19,501)
Comprehensive (loss) income	(650,979)	298,995	(1,659,811)	109,097
Less: comprehensive loss attributable to non-controlling shareholders	(148,111)	(66,043)	(460,761)	(66,043)
Comprehensive (loss) income attributable to FGI Industries Ltd. shareholders	$ (502,868)	$ 365,038	$ (1,199,050)	$ 175,140
Weighted average number of ordinary shares
Basic (in shares)	9,563,914	9,500,000	9,565,587	9,500,000
Diluted (in shares)	9,563,914	9,786,522	9,565,587	9,822,847
(Loss) earnings per share
Basic (in dollars per share)	$ (0.06)	$ 0.04	$ (0.08)	$ 0.02
Diluted (in dollars per share)	$ (0.06)	$ 0.04	$ (0.08)	$ 0.02

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY - USD ($)	Total	Total FGI Industries Ltd. Shareholders' Equity	Preference Shares	Ordinary Shares	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Loss	Non- Controlling Interests
Beginning balance (in shares) at Dec. 31, 2022			0	9,500,000
Beginning balance at Dec. 31, 2022	$ 22,744,410	$ 22,744,410	$ 0	$ 950	$ 20,459,859	$ 3,679,920	$ (1,396,319)	$ 0
Increase (Decrease) in Stockholders' Equity
Share-based compensation	119,721	119,721			119,721
Net income (loss)	(303,375)	(303,375)				(303,375)
Foreign currency translation adjustment	20,099	20,099					20,099
Ending balance (in shares) at Mar. 31, 2023			0	9,500,000
Ending balance at Mar. 31, 2023	22,580,855	22,580,855	$ 0	$ 950	20,579,580	3,376,545	(1,376,220)	0
Beginning balance (in shares) at Dec. 31, 2022			0	9,500,000
Beginning balance at Dec. 31, 2022	22,744,410	22,744,410	$ 0	$ 950	20,459,859	3,679,920	(1,396,319)	0
Increase (Decrease) in Stockholders' Equity
Net income (loss)	128,598
Foreign currency translation adjustment	(19,501)
Ending balance (in shares) at Sep. 30, 2023			0	9,500,000
Ending balance at Sep. 30, 2023	23,185,400	23,251,443	$ 0	$ 950	20,791,752	3,874,561	(1,415,820)	(66,043)
Beginning balance (in shares) at Mar. 31, 2023			0	9,500,000
Beginning balance at Mar. 31, 2023	22,580,855	22,580,855	$ 0	$ 950	20,579,580	3,376,545	(1,376,220)	0
Increase (Decrease) in Stockholders' Equity
Share-based compensation	152,835	152,835			152,835
Net income (loss)	88,481	88,481				88,481
Foreign currency translation adjustment	4,897	4,897					4,897
Ending balance (in shares) at Jun. 30, 2023			0	9,500,000
Ending balance at Jun. 30, 2023	22,827,068	22,827,068	$ 0	$ 950	20,732,415	3,465,026	(1,371,323)	0
Increase (Decrease) in Stockholders' Equity
Share-based compensation	59,337	59,337			59,337
Net income (loss)	343,492	409,535				409,535		(66,043)
Foreign currency translation adjustment	(44,497)	(44,497)					(44,497)
Ending balance (in shares) at Sep. 30, 2023			0	9,500,000
Ending balance at Sep. 30, 2023	23,185,400	23,251,443	$ 0	$ 950	20,791,752	3,874,561	(1,415,820)	(66,043)
Beginning balance (in shares) at Dec. 31, 2023			0	9,547,607
Beginning balance at Dec. 31, 2023	24,026,772	24,180,812	$ 0	$ 955	20,877,832	4,413,524	(1,111,499)	(154,040)
Increase (Decrease) in Stockholders' Equity
Share-based compensation	119,586	119,586			119,586
Net income (loss)	(537,859)	(412,189)				(412,189)		(125,670)
Foreign currency translation adjustment	(22,578)	(22,578)					(22,578)
Ending balance (in shares) at Mar. 31, 2024			0	9,547,607
Ending balance at Mar. 31, 2024	23,585,921	23,865,631	$ 0	$ 955	20,997,418	4,001,335	(1,134,077)	(279,710)
Beginning balance (in shares) at Dec. 31, 2023			0	9,547,607
Beginning balance at Dec. 31, 2023	24,026,772	24,180,812	$ 0	$ 955	20,877,832	4,413,524	(1,111,499)	(154,040)
Increase (Decrease) in Stockholders' Equity
Net income (loss)	(1,259,522)
Foreign currency translation adjustment	(400,289)
Ending balance (in shares) at Sep. 30, 2024			0	9,563,914
Ending balance at Sep. 30, 2024	22,903,558	23,518,359	$ 0	$ 956	21,414,428	3,614,763	(1,511,788)	(614,801)
Beginning balance (in shares) at Mar. 31, 2024			0	9,547,607
Beginning balance at Mar. 31, 2024	23,585,921	23,865,631	$ 0	$ 955	20,997,418	4,001,335	(1,134,077)	(279,710)
Increase (Decrease) in Stockholders' Equity
Share-based compensation (in shares)				16,307
Share-based compensation	208,505	208,505		$ 1	208,504
Net income (loss)	(23,415)	163,565				163,565		(186,980)
Foreign currency translation adjustment	(424,980)	(424,980)					(424,980)
Ending balance (in shares) at Jun. 30, 2024			0	9,563,914
Ending balance at Jun. 30, 2024	23,346,031	23,812,721	$ 0	$ 956	21,205,922	4,164,900	(1,559,057)	(466,690)
Increase (Decrease) in Stockholders' Equity
Share-based compensation	208,506	208,506			208,506
Net income (loss)	(698,248)	(550,137)				(550,137)		(148,111)
Foreign currency translation adjustment	47,269	47,269					47,269
Ending balance (in shares) at Sep. 30, 2024			0	9,563,914
Ending balance at Sep. 30, 2024	$ 22,903,558	$ 23,518,359	$ 0	$ 956	$ 21,414,428	$ 3,614,763	$ (1,511,788)	$ (614,801)

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	3 Months Ended				9 Months Ended		12 Months Ended
	Sep. 30, 2024	Mar. 31, 2024	Sep. 30, 2023	Mar. 31, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net (loss) income	$ (698,248)	$ (537,859)	$ 343,492	$ (303,375)	$ (1,259,522)	$ 128,598
Adjustments to reconcile net (loss) income to net cash used in operating activities
Depreciation	125,244		56,497		324,683	135,256
Amortization					1,818,366	1,247,096
Share-based compensation					536,597	331,893
Provision for credit losses					79,762	31,324	$ 78,640
Provision for defective return					489,975	(710,643)	(851,554)
Foreign exchange transaction loss					(225,317)	(23,875)
Deferred income tax benefit					(850,825)	(143,090)
Changes in operating assets and liabilities
Accounts receivable					(3,792,409)	(1,627,547)
Inventories					(3,861,657)	3,658,593
Other noncurrent assets					(627,654)	568,820
Income taxes					(124,369)	188,964
Operating lease liabilities					(1,443,510)	(946,208)
Accrued expenses and other current liabilities					1,094,693	70,300
Net cash used in operating activities					(8,042,745)	(1,986,964)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment					(1,374,500)	(274,971)
Purchase of intangible assets					(669,764)	(608,083)
Net cash used in investing activities					(2,044,264)	(883,054)
CASH FLOWS FROM FINANCING ACTIVITIES
Net proceeds from (repayments of) revolving credit facility					5,526,322	(1,832,849)
Net cash provided by (used in) financing activities					5,526,322	(1,832,849)
EFFECT OF EXCHANGE RATE FLUCTUATION ON CASH					(171,892)	5,386
NET CHANGES IN CASH					(4,732,579)	(4,697,481)
CASH, BEGINNING OF PERIOD		$ 7,777,241		$ 10,067,428	7,777,241	10,067,428	10,067,428
CASH, END OF PERIOD	$ 3,044,662		$ 5,369,947		3,044,662	5,369,947	$ 7,777,241
SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid during the period for interest					(881,759)	(560,314)
Cash paid during the period for income taxes					(961,890)	(350,500)
NON-CASH INVESTING AND FINANCING ACTIVITIES
New addition on Right-of-use assets					(16,807)	(7,644,734)
Acquisition of intangible asset partially through prior period advanced payment					(1,241,664)	0
Nonrelated Party
Changes in operating assets and liabilities
Prepayments and other current assets					785,879	(1,250,806)
Accounts payable					5,703,521	(666,122)
Related Party
Changes in operating assets and liabilities
Prepayments and other current assets					(5,960,704)	(5,360,839)
Accounts payable					$ (730,254)	$ 2,381,322

Nature of business and organization

9 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Nature of business and organization

The accompanying unaudited condensed consolidated financial statements reflect the activities of FGI and each of the following entities after the Reorganization, as described below:

Name

Background

Ownership

FGI Industries Inc.

•A New Jersey corporation

100% owned by FGI

(formerly named Foremost Groups, Inc.)

•Incorporated on January 5, 1988

•Sales and distribution in the United States

FGI Europe Investment Limited

•A British Virgin Islands holding company

100% owned by FGI

•Incorporated on January 1, 2007

FGI International, Limited

•A Hong Kong company

100% owned by FGI

•Incorporated on June 2, 2021

•Sales, sourcing and product development

FGI Canada Ltd.

•A Canadian company

100% owned by FGI Industries Inc.

•Incorporated on October 17, 1997

•Sales and distribution in Canada

FGI Germany GmbH & Co. KG

•A German company

100% owned by FGI Europe Investment Limited

•Incorporated on January 24, 2013

•Sales and distribution in Germany

FGI China, Ltd.

•A PRC limited liability company

100% owned by FGI International, Limited

•Incorporated on August 19, 2021

•Sourcing and product development

FGI United Kingdom Ltd

•An UK company

100% owned by FGI Europe Investment Limited

•Incorporated on December 10, 2021

•Sales and distribution in UK

FGI Australasia Pty Ltd

•An Australian company

100% owned by FGI

•Incorporated on September 8, 2022

•Sales and distribution in Australia

Covered Bridge Cabinetry Manufacturing Co., Ltd

•A Cambodian company

100% owned by FGI

•Incorporated on April 21, 2022

•Manufacturing in Cambodia

Isla Porter LLC

•A New Jersey company

60% owned by FGI Industries Inc.

•Formed on June 2, 2023

•Sales and distribution in the United States

FGI Industries India Private Limited

•An Indian company

100% owned by FGI

•Incorporated on June 11, 2024

•Sales and distribution in India

Reorganization


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Revenue	$	—	$	—	$	—	$	991,919
Cost of revenue	—		—		—		(768,065)
Gross profit	—		—		—		223,854
Selling and distribution expenses	—		—		—		45,979
General and administrative expenses	—		—		—		—
Research and development expenses	—		—		—		—
Income from operations	$	—	$	—	$	—	$	269,833

Since October 2022, the books and records of FGI International have been completely separated from Foremost Worldwide Co., Ltd., a wholly-owned subsidiary of Foremost.

Summary of significant accounting policies

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

Summary of significant accounting policies

Liquidity

•other available sources of financing from other banks and financial institutions;

•sales of additional securities to the public or other investors; and

•financial support from the Company’s shareholders.

Basis of presentation

Principles of consolidation

Use of estimates and assumptions

Foreign currency translation and transaction

Reclassification

Cash

Accounts receivable, net

Inventories, net

Prepayments

Property and equipment, net


			Useful Life
Building			20 years
Leasehold Improvements			Lesser of lease term and expected useful life
Machinery and equipment			3 – 5 years
Furniture and fixtures			3 – 5 years
Vehicles			5 years
Molds			3 – 5 years

Intangible assets, net

for impairment. The Company typically amortizes its intangible assets with definite useful lives on a straight-line basis over the estimated useful lives of ten years.

Impairment for long-lived assets

Leases

Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Fair Value Measurement

•Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

•Level 3 inputs to the valuation methodology are unobservable and significant to the fair value.

Revenue recognition

The Company records receivables related to revenue when it has an unconditional right to invoice and receive payment.

The Company’s disaggregated revenue is summarized as follows:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Revenue by product line
Sanitaryware	$	21,451,387	$	20,740,380	$	59,303,663	$	54,949,082
Bath Furniture	4,162,291		2,531,430		11,282,623		12,304,688
Shower System	7,143,283		4,931,437		18,793,999		14,248,679
Others	3,342,218		1,729,365		6,843,362		4,782,342
Total	$	36,099,179	$	29,932,612	$	96,223,647	$	86,284,791


	Total Revenue								Total Assets
	For the Three Months Ended September 30,				For the Nine Months Ended September 30,				As of September 30,		As of December 31,
	2024		2023		2024		2023		2024		2023
	USD		USD		USD		USD		USD		USD

Revenue/ total assets by geographic location
United States	$	22,195,976	$	18,356,278	$	59,833,465	$	54,921,572	$	48,881,570	$	38,401,665
Canada	9,916,907		9,081,571		26,391,317		23,120,014		15,049,656		17,850,709
Europe	3,418,826		2,460,762		9,273,872		8,209,204		1,176,616		528,068
Rest of World	567,470		34,001		724,993		34,001		9,557,084		8,964,488
Total	$	36,099,179	$	29,932,612	$	96,223,647	$	86,284,791	$	74,664,926	$	65,744,930

Shipping and Handling Costs

Share-based compensation

Income Taxes

The Company records interest and penalties on our uncertain tax positions in income tax expense.

As of September 30, 2024, the tax years ended December 31, 2020 through December 31, 2022 for FGI Industries remain open for statutory examination by tax authority.

Non-controlling interests

Comprehensive income (loss)

Earnings (loss) per share

The following table sets forth the computation of basic and diluted earnings per share for the three months ended September 30, 2024 and 2023:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Numerator:
Net (loss) income attributable to FGI Industries Ltd. shareholders	$	(550,137)	$	409,535	$	(798,761)	$	194,641

Denominator:
Weighted-average number of ordinary shares outstanding — basic	9,563,914		9,500,000		9,565,587		9,500,000
Potentially dilutive shares from outstanding options/warrants	—		286,522		—		322,847
Weighted-average number of ordinary shares outstanding — diluted	9,563,914		9,786,522		9,565,587		9,822,847

Earnings (loss) per share — basic	$	(0.06)	$	0.04	$	(0.08)	$	0.02
Earnings (loss) per share — diluted	$	(0.06)	$	0.04	$	(0.08)	$	0.02

Segment reporting

Recently adopted accounting pronouncements

The Company considers the applicability and impact of all ASUs. ASUs not listed above were assessed and determined not to be applicable.

Accounts receivable, net

9 Months Ended

Sep. 30, 2024

Receivables [Abstract]

Accounts receivable, net

Accounts receivable, net consisted of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Accounts receivable	$	20,377,488	$	17,184,706
Allowance for credit losses	(133,991)		(244,879)
Accrued defective return and discount	(1,234,259)		(744,284)
Accounts receivable, net	$	19,009,238	$	16,195,543

Movements of allowance for credit losses are as follows:


	For the Nine Months Ended September 30,		For the Year Ended December 31,
	2024		2023
	USD		USD

Beginning balance	$	244,879	$	438,843
Provision (recovery)	79,762		78,640
Write-off	(190,650)		(272,604)
Ending balance	$	133,991	$	244,879

Movements of accrued defective return and discount accounts are as follows:


	For the Nine Months Ended September 30,		For the Year Ended December 31,
	2024		2023
	USD		USD

Beginning balance	$	744,284	$	1,595,838
Provision (recovery)	489,975		(851,554)
Ending balance	$	1,234,259	$	744,284

Inventories, net

9 Months Ended

Sep. 30, 2024

Inventory Disclosure [Abstract]

Inventories, net

Inventories, net consisted of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Finished product	$	14,514,881	$	10,565,858
Reserves for slow-moving inventories	(729,372)		(642,006)
Inventories, net	$	13,785,509	$	9,923,852

Movements of inventory reserves are as follows:


	For the Nine Months Ended September 30,		For the Year Ended December 31,
	2024		2023
	USD		USD

Beginning balance	$	642,006	$	663,530
Provision (recovery)	87,366		(21,524)
Ending balance	$	729,372	$	642,006

Prepayments and other assets

9 Months Ended

Sep. 30, 2024

Prepaid Expense and Other Assets, Current [Abstract]

Prepayments and other assets

Prepayments and other assets consisted of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Prepayments	$	2,333,839	$	3,953,340
Others	256,368		664,411
Total prepayments and other assets	$	2,590,207	$	4,617,751

Property and equipment, net

9 Months Ended

Sep. 30, 2024

Property, Plant and Equipment [Abstract]

Property and equipment, net

Property and equipment, net consist of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Building	$	946,066	$	946,066
Leasehold Improvements	2,951,116		1,695,361
Machinery and equipment	1,694,957		1,613,439
Furniture and fixtures	278,578		259,449
Vehicles	147,912		147,912
Molds	26,377		26,377
Subtotal	6,045,006		4,688,604
Less: accumulated depreciation	(3,133,593)		(2,778,113)
Prepayment for purchase of equipment and construction-in-progress	45,818		—
Total	$	2,957,231	$	1,910,491

Leases

9 Months Ended

Sep. 30, 2024

Leases [Abstract]

Leases

The Company has operating leases primarily for corporate offices, warehouses and showrooms. As of September 30, 2024, the Company’s leases have remaining lease terms up to 10.5 years.

The table below presents the operating lease related assets and liabilities recorded on the Company’s consolidated balance sheets:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Operating lease right-of-use assets	$	13,488,342	$	15,203,576
Operating lease liabilities – current	$	1,785,996	$	1,595,998
Operating lease liabilities – noncurrent	12,057,751		13,674,452
Total operating lease liabilities	$	13,843,747	$	15,270,450

Information relating to the lease term and discount rate are as follows:


	As of September 30, 2024		As of December 31, 2023

Weighted-average remaining lease term
Operating leases	9.0 years		9.4 years
Weighted-average discount rate
Operating leases	5.7	%	5.7	%

As of September 30, 2024, the maturities of operating lease liabilities were as follows:


For the 12 months ending September 30,
2025	$	2,538,099
2026	2,635,492
2027	2,650,249
2028	2,301,432
2029	1,682,400
Thereafter	5,765,659
Total lease payments	17,573,331
Less: imputed interest	(3,729,584)
Present value of lease liabilities	$	13,843,747

Short-term loans	9 Months Ended
Short-term loans	Sep. 30, 2024
Debt Disclosure [Abstract]
Short-term loans	Short-term loans Bank loan Our wholly-owned subsidiary FGI Industries has a line of credit agreement (the “Credit Agreement”) with East West Bank, which is collateralized by all assets of FGI Industries and personally guaranteed by Liang Chou Chen, who holds approximately 49.89% of the voting control of Foremost. The current amount of maximum borrowings is $18,000,000 and the Credit Agreement has a maturity date of December 21, 2024. This is an assets-based line of credit, the borrowing limit is calculated based on certain percentage of accounts receivable and inventory balances. Pursuant to the Credit Agreement, FGI Industries is required to maintain (a) a debt coverage ratio (defined as earnings before interest, taxes, depreciation and amortization divided by current portion of long-term debt plus interest expense) of not less than 1.25 to 1, tested at the end of each fiscal quarter; (b) an effective tangible net worth (defined as total book net worth plus minority interest, less amounts due from officers, shareholders and affiliates, minus intangible assets and accumulated amortization, plus debt subordinated to East West Bank) of not less than $10,000,000, tested at the end of each fiscal quarter, on a consolidated basis; and (c) a total debt to tangible net worth ratio (defined as total liabilities divided by tangible net worth, which is defined as total book net worth plus minority interest, less loans to officers, shareholders, and affiliates minus intangible assets and accumulated amortization) not to exceed 4.0 to 1, tested at the end of each fiscal quarter, on a consolidated basis. As of September 30, 2024, FGI Industries was in compliance with these financial covenants. The loan bears interest at rate equal to, at the Company’s option, either (i) 0.25 percentage points less than the Prime Rate quoted by the Wall Street Journal or (ii) the SOFR Rate (as administered by CME Group Benchmark Administration Limited and displayed by Bloomberg LP) plus 2.20% per annum (in either case, subject to a minimum rate of 4.500% per annum). The interest rate as of September 30, 2024, and December 31, 2023 was 7.75% and 8.25%, respectively. Each sum of borrowings under the Credit Agreement is deemed due on demand and is classified as a short-term loan. The outstanding balance of such loan was $9,161,641 and $6,959,175 as of September 30, 2024, and December 31, 2023, respectively. HSBC Canada Bank Loan / Foreign Exchange Facility FGI Canada Ltd. has a line of credit agreement with HSBC Canada (the “Canadian Revolver”). The revolving line of credit with HSBC Canada allows for borrowing up to CAD7,500,000 (USD5,474,453 as of the September 30, 2024 exchange rate). This is an assets-based line of credit, the borrowing limit is calculated based on certain percentage of accounts receivable and inventory balances. Pursuant to the Canadian Revolver, FGI Canada Ltd. is required to maintain (a) a debt to tangible net worth ratio of no more than 3.00 to 1.00; and (b) a ratio of current assets to current liabilities of at least 1.25 to 1.00. The loan bears interest at a rate of Prime rate plus 0.50%. As of September 30, 2024, FGI Canada Ltd. was not in compliance with certain financial covenants in the Canadian Revolver related to its debt to tangible net worth ratio. As of the date of this quarterly report, FGI Canada Ltd. has requested a waiver from the lender, which is being processed by the lender. In the absence of an executed waiver, the Company has classified the outstanding balance of the loan as a current liability on the unaudited condensed consolidated balance sheet as of September 30, 2024. The Company has sufficient liquidity to repay the loan in full if immediate settlement were required. Borrowings under this line of credit amounted to $1,026,392 and $0 as of September 30, 2024, and December 31, 2023, respectively. The facility matures at the discretion of HSBC Canada upon 60 days’ notice. FGI Canada Ltd. also has a revolving foreign exchange facility with HSBC Canada of up to a permitted maximum of USD3,000,000. The advances are available to purchase foreign exchange forward contracts from time to time up to six months, subject to an overall maximum aggregate USD Equivalent outstanding face value not exceeding $3,000,000. CTBC Credit Facility On January 25, 2024, FGI International entered into an omnibus credit line (the “CTBC Credit Line”) with CTBC Bank Co., Ltd. (“CTBC”). Under the CTBC Credit Line, FGI International may borrow, from time to time, up to $2.3 million, with borrowings limited to 90% of FGI International’s export “open account” trade receivables. The CTBC Credit Line will bear interest at a rate of “Base Rate”, which is based on monthly or quarterly Taipei Interbank Offered in effect from time to time, plus 120 base points and handling fees, unless otherwise agreed to by the parties. The CTBC Credit Line is unsecured and is fully guaranteed by the Company and partially guaranteed by Liang Chou Chen. Borrowings under this line of credit amounted to $2,297,464 and $0 as of September 30, 2024 and December 31, 2023, respectively.

Shareholders' Equity	9 Months Ended
Shareholders' Equity	Sep. 30, 2024
Equity [Abstract]
Shareholders' Equity	Shareholders’ Equity FGI was incorporated in the Cayman Islands on May 26, 2021 in connection with the planned Reorganization, as described in Note 1. The Company is authorized to issue 50,000,000 ordinary shares with a par value of $0.001 per share. On January 27, 2022, the Company completed the Reorganization upon the consummation of the initial public offering (“IPO”). After the Reorganization and the IPO, the Company’s authorized share capital is $21,000 divided into (i) 200,000,000 Ordinary Shares of par value of $0.0001 each, and (ii) 10,000,000 Preference Shares of par value of $0.0001 each; 9,500,000 ordinary shares were issued and outstanding accordingly. The Company believes it is appropriate to reflect these share issuances as nominal share issuances on a retroactive basis similar to a stock split pursuant to ASC 260. The Company has retroactively adjusted all shares and per share data for all the periods presented. Initial Public Offering On January 27, 2022, the Company consummated its IPO of 2,500,000 units (“Units”), each consisting of (i) one ordinary share, $0.0001 par value per share, of the Company (the “Shares”), and (ii) one warrant of the Company (the “Warrants”) entitling the holder to purchase one Share at an exercise price of $6.00 per Share. The Shares and Warrants were issued separately in the offering, and may be transferred separately immediately upon issuance. The Units were sold at a price of $6.00 per Unit. The Warrants included in the units were immediately exercisable following the consummation of the offering, have an exercise price equal to the initial public offering price, and expire five years from the date of issuance. For the purposes of covering any over-allotments in connection with the distribution and sale of the Units, the Company granted a 45-day option to the underwriters to purchase (the “Over-allotment Option”), in the aggregate, up to 375,000 ordinary shares (the “Option Shares”) and Warrants to purchase up to 375,000 ordinary shares (the “Option Warrants”), which was exercisable in any combination of Option Shares and/or Option Warrants at the per Share purchase price and/or the per Warrant purchase price, respectively. On January 25, 2022, the underwriters exercised in full their option to purchase up to an additional 375,000 Warrants at the price of $0.01 per Option Warrant. Management determined that these Warrants meet the definition of a derivative under ASC 815-40; however, they fall under the scope exception, which states that contracts issued that both a) indexed to its own stock; and b) classified in shareholders' equity are not considered derivatives. The Warrants were recorded at their fair value on the date of grant as a component of equity. The aggregated fair value of these Warrants on January 27, 2022 was $4.16 million. The fair value has been estimated using the Black-Scholes pricing model with the following weighted-average assumptions: market value of underlying stock of $1.448; risk free rate of 1.66%; expected term of five years; exercise price of the warrants of $6.00; volatility of 44.00%; and expected future dividends of $0. As of the date of this report, 2,875,000 warrants were issued and outstanding; and none of the warrants has been exercised. The gross proceeds from the IPO were approximately $15.0 million with net proceeds of approximately $12.4 million, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by the Company. Immediately following the consummation of the IPO, there were an aggregate of 9,500,000 ordinary shares issued and outstanding. As a result of the IPO, the ordinary shares and Warrants now trade on the Nasdaq Capital Market under the symbol “FGI” and “FGIWW”, respectively. Public Offering Warrants In connection with and upon the closing of the IPO on January 27, 2022, the Company issued warrants equal to 2% of the Shares issued in the IPO, or 50,000 ordinary shares, to the representative of the underwriters for the IPO. The warrants carry a term of five years, shall not be exercisable for a period of 180 days from the closing of the IPO and shall be exercisable at a price equal to the IPO price per share. Management determined that these warrants meet the definition of a derivative under ASC 815-40; however, they fall under the scope exception, which states that contracts issued that are both a) indexed to its own stock; and b) classified in shareholders' equity are not considered derivatives. The warrants were recorded at their fair value on the date of grant as a component of equity. The aggregated fair value of these IPO warrants on January 27, 2022 was $0.1 million. The fair value has been estimated using the Black-Scholes pricing model with the following weighted-average assumptions: market value of underlying stock of $1.448; risk free rate of 1.66%; expected term of five years; exercise price of the warrants of $6.00; volatility of 44.00%; and expected future dividends of $0. As of the date of this report, warrants exercisable for 50,000 shares were issued and outstanding; and none of the warrants have been exercised.

Stock-based compensation

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Stock-based compensation

2021 Equity Plan and Employee Stock Purchase Plan

Company, to provide additional incentives to them to align their interests with those of the Company’s shareholders and to thereby promote the Company’s long-term business success.

Restricted shares units (“RSU”)

The following is a summary of the restricted shares granted:


Restricted shares grants						Shares
Non-vested as of January 1, 2023						296,474
Granted						113,984
Vested						(66,111)
Canceled						(87,611)
Non-vested as of December 31, 2023						256,736
Granted						426,687
Vested						(72,112)
Canceled						—
Non-vested as of September 30, 2024						611,311

The following is a summary of the status of restricted shares as of September 30, 2024:


Outstanding Restricted Shares
Fair Value per share		Number	Average Remaining Amortization Period (Years)
$	3.90	61,250	0.33
$	2.52	1,701	0.50
$	2.20	16,363	0.25
$	2.08	96,635	1.50
$	2.08	8,675	1.50
$	1.50	413,354	2.50
$	1.50	13,333	0.25
		611,311

Share options (“Options”)

equal monthly installments upon completion of each additional month of service. As of September 30, 2024, 78,438 of these granted options were vested.


	Number of Options	Weighted Average Exercise Price	Weighted Average Grant Date Fair Value	Weighted Average Remaining Contractual Term	Average Intrinsic Value
		USD	USD	Years	USD
Share options outstanding at December 31, 2023	355,999	2.56	1.20	9.35	—
Granted	697,629	1.46	0.82	10.00	—
Forfeited	—	N/A	N/A	N/A	N/A
Exercised	—	N/A	N/A	N/A	N/A
Expired	—	N/A	N/A	N/A	N/A
Share options outstanding at September 30, 2024	1,053,628	1.83	0.95	8.84	—
Vested and exercisable at September 30, 2024	285,079	2.57	1.21	7.54	—

For the nine months ended September 30, 2024 and 2023, the total fair value of options awarded was $573,163 and $201,000, respectively.

Fair value of options

The Company used the Black-Scholes simplified method for the nine months ended September 30, 2024 and 2023. The assumptions used to value the options granted to employees were as follows:


	April 2024		March 2024		March 2023

Risk-free interest rate (%)	4.54		4.21		3.65
Expected volatility range (%)	55.32		55.11		63.36
Fair market value per ordinary share as at grant dates	$	1.32	$	1.50	$	2.08

The following table sets forth the amount of share-based compensation expense included in each of the relevant financial statement line items:


	For the Nine Months Ended September 30,
	2024		2023
	USD		USD
Selling and distribution expenses	$	116,584	$	93,746
General and administrative expenses	420,013		238,147
Total share-based compensation expenses	$	536,597	$	331,893

Income taxes

9 Months Ended

Sep. 30, 2024

Income Tax Disclosure [Abstract]

Income taxes

The source of pre-tax income and the components of income tax expense are as follows:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Income components
United States	$	(1,614,080)	$	(239,835)	$	(3,455,011)	$	(641,733)
Outside United States	1,183,369		755,843		2,186,900		1,166,922
Total pre-tax (loss) income	$	(430,711)	$	516,008	$	(1,268,111)	$	525,189
Provision for income taxes
Current
Federal	$	(12,757)	$	(6,062)	$	(12,219)	$	4,562
State	29,128		7,210		37,553		10,343
Foreign	502,214		223,979		831,959		524,776
	518,585		225,127		857,293		539,681
Deferred
Federal	(154,816)		(42,497)		(572,163)		(135,172)
State	(96,232)		(10,114)		(149,646)		(3,930)
Foreign	—		—		(144,073)		(3,988)
	(251,048)		(52,611)		(865,882)		(143,090)
Total provision for income taxes	$	267,537	$	172,516	$	(8,589)	$	396,591

Reconciliations between taxes at the U.S. federal income tax rate and taxes at the Company’s effective income tax rate on earnings before income taxes are as follows:


	For the Nine Months Ended September 30,
	2024	2023
	%	%
Federal statutory rate	21.0	21.0
Increase (decrease) in tax rate resulting from:
State and local income taxes, net of federal benefit	6.1	(1.7)
Foreign operations	(16.2)	21.5
Permanent items	(10.8)	0.7
Deferred adjustments	(0.1)	2.1
Others	0.7	0.1
Effective tax rate	0.7	43.7

The following is a summary of the components of the net deferred tax assets and liabilities recognized in the consolidated balance sheets:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Deferred tax assets
Allowance for credit losses	$	31,996	$	58,476
Other reserve	108,814		61,371
Accrued expenses	146,771		143,823
Lease liability	1,541,398		1,769,328
Charitable contributions	8,306		8,181
Business interest limitation	519,320		242,862
Net operating loss – federal	602,265		310,099
Net operating loss – state	102,852		27,337
Other	195,389		66,063
Total deferred tax assets	3,257,111		2,687,540
Less: valuation allowance	—		—
Net deferred tax assets	3,257,111		2,687,540
Deferred tax liabilities
Fixed assets	1,471,219		1,728,364
Intangibles	(233,765)		(209,657)
Total deferred tax liabilities	1,237,454		1,518,707
Deferred tax assets, net of deferred tax liabilities	$	2,019,657	$	1,168,833

Inflation Reduction Act of 2022

Related party transactions and balances

9 Months Ended

Sep. 30, 2024

Related party transactions and balances

Sales to a related party


Name of Related Party	Relationship	Nature of Transactions	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
			2024		2023		2024		2023
			USD		USD		USD		USD
Foremost Worldwide Co., Ltd.	An entity under common control	Sales	$	408,977	$	—	$	408,977	$	—
			$	408,977	$	—	$	408,977	$	—

Purchases from related parties


Name of Related Party	Relationship	Nature of Transactions	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
			2024		2023		2024		2023
			USD		USD		USD		USD
Focal Capital Holding Limited	An entity under common control	Purchase	$	1,903,797	$	980,910	$	4,658,602	$	5,950,640
Foremost Worldwide Co., Ltd.	An entity under common control	Purchase	1,883,192		717,188		5,837,250		1,755,577
Rizhao Foremost Woodwork Manufacturing Co., Ltd.	An entity under common control	Purchase	15,874		—		39,943		—
F.P.Z. Furniture (Cambodia) Co., Ltd.	An entity under common control	Purchase	—		575,060		—		575,060
Foremost Australasia Pty Ltd	An entity under common control	Purchase	—		413,339		—		413,339
			$	3,802,863	$	2,686,497	$	10,535,795	$	8,694,616

The ending balance of such transactions as of September 30, 2024 and December 31, 2023 are listed of the following:

Prepayments — related parties


Name of Related Party	As of September 30, 2024		As of December 31, 2023
	USD		USD

Focal Capital Holding Limited	$	12,043,142	$	6,658,498
Rizhao Foremost Woodwork Manufacturing Co., Ltd.	24,364		9,181
	$	12,067,506	$	6,667,679

Accounts Payables — related parties


Name of Related Party	As of September 30, 2024		As of December 31, 2023
	USD		USD

Foremost Worldwide Co., Ltd.	$	5,053	$	735,308
	$	5,053	$	735,308

Shared Service and Miscellaneous expenses – related party

Other Receivables (Payables) — related parties

Name of Related Party

Relationship

Nature of
Transactions

As of
September 30,
2024

As of
December 31,
2023

USD

Foremost Home Inc. (“FHI”)

An entity under common control

Shared services and Miscellaneous expenses

2,215,919

1,183,612

Foremost Worldwide Co., Ltd.

An entity under common control

Shared services and Miscellaneous expenses

(45,026)

(251,008)

Focal Capital Holding Limited

An entity under common control

Shared services and Miscellaneous expenses

(11,306)

—

F.P.Z. Furniture (Cambodia) Co., Ltd.

An entity under common control

Shared services and Miscellaneous expenses

(257,130)

—

1,902,457

932,604

Loan guarantee by a related party

Concentrations of risks	9 Months Ended
Concentrations of risks	Sep. 30, 2024
Risks and Uncertainties [Abstract]
Concentrations of risks	Concentrations of risks Credit risk Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash. The Federal Deposit Insurance Corporation pays compensation up to a limit of USD250,000 if the bank with which a depositor holds its eligible deposit fails. As of September 30, 2024, a cash balance of USD372,731 was maintained at financial institutions in the United States, of which USD93,835 was subject to credit risk. The Canadian Deposit Insurance Corporation pays compensation up to a limit of CAD100,000 (approximately USD73,000) if the bank with which an individual/a company holds its eligible deposit fails. As of September 30, 2024, a cash balance of CAD205,760 (USD150,190) was maintained at financial institutions in Canada, of which CAD105,760 (USD77,197) was subject to credit risk. The Taiwan Central Deposit Insurance Corporation pays compensation up to a limit of New Taiwan Dollar 3,000,000 (approximately USD93,000) if the bank with which an individual/a company holds its eligible deposit fails. As of September 30, 2024, an aggregated cash balance of USD1,535,430 was maintained at financial institutions in Taiwan, of which USD1,221,203 was subject to credit risk. The European Banking Authority pays compensation up to a limit of EUR100,000 (approximately USD112,000) if the bank with which an individual/a company holds its eligible deposit fails. As of September 30, 2024, cash balance of EUR366,827 (USD409,588) was maintained at financial institutions in Europe, of which EUR266,827 (USD297,931) was subject to credit risk. As of September 30, 2024, cash balance of USD142,166 was maintained at financial institutions in Kingdom of Cambodia, all of which was subject to credit risk. The Australian Prudential Regulation Authority pays compensation up to a limit of AUD250,000 (approximately USD172,592) if the bank with which an individual/a company holds its eligible deposit fails. As of September 30, 2024, cash balance of AUD292,986 (USD202,269) was maintained at financial institutions in Australia, of which AUD42,986 (USD29,676) was subject to credit risk. The Reserve Bank of India pays compensation up to a limit of INR500,000 (approximately USD5,973) if the bank with which an individual/a company holds its eligible deposit fails. As of September 30, 2024, cash balance of INR1,566,366 (USD18,712) was maintained at financial institutions in India, of which INR1,066,366 (USD12,739) was subject to credit risk. While management believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness. The Company is also exposed to risk from its accounts receivable and other receivables. These assets are subjected to credit evaluations. An allowance has been made for estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment. Customer concentration risk For the three months ended September 30, 2024, two customers accounted for 19.5% and 15.1% of the Company’s total revenue, respectively. For the three months ended September 30, 2023, three customers accounted for 14.5%, 14.3% and 13.9% of the Company’s total revenue, respectively. No other customer accounted for more than 10% of the Company’s revenue for the three months ended September 30, 2024 and 2023. For the nine months ended September 30, 2024, two customers accounted for 17.5% and 16.8% of the Company’s total revenue, respectively. For the nine months ended September 30, 2023, two customers accounted for 17.4% and 16.6% of the Company’s total revenue, respectively. No other customer accounted for more than 10% of the Company’s revenue for the nine months ended September 30, 2024 and 2023. As of September 30, 2024, three customers accounted for 27.6%, 15.0% and 10.8% of the total balance of accounts receivable, respectively. As of December 31, 2023, four customers accounted for 27.2%, 19.0%, 12.0% and 11.1% of the total balance of accounts receivable, respectively. No other customer accounted for more than 10% of the Company’s accounts receivable as of September 30, 2024 and December 31, 2023. Vendor concentration risk For the three months ended September 30, 2024, Tangshan Huida Ceramic Group Co., Ltd (“Huida”) accounted for 57.3% of the Company’s total purchases, respectively. For the three months ended September 30, 2023, Huida accounted for 55.8% of the Company’s total purchases, respectively. No other supplier accounted for more than 10% of the Company’s total purchases for the three months ended September 30, 2024 and 2023. For the nine months ended September 30, 2024, Tangshan Huida Ceramic Group Co., Ltd (“Huida”) accounted for 55.6% of the Company’s total purchases. For the nine months ended September 30, 2023, Huida and another vendor accounted for 54.5% and 10.1% of the Company’s total purchases, respectively. No other supplier accounted for more than 10% of the Company’s total purchases for the nine months ended September 30, 2024 and 2023. As of September 30, 2024, Huida accounted for 72.0% of the total balance of accounts payable. As of December 31, 2023, Huida accounted for 71.4% of the total balance of accounts payable. No other supplier accounted for more than 10% of the Company’s accounts payable as of September 30, 2024 and December 31, 2023.

Commitments and contingencies	9 Months Ended
Commitments and contingencies	Sep. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
Commitments and contingencies	Commitments and contingencies Litigation From time to time, the Company is involved in legal and regulatory proceedings that are incidental to the operation of its businesses. These proceedings may seek remedies relating to matters including environmental, tax, intellectual property, acquisitions or divestitures, product liability, property damage, personal injury, privacy, employment, labor and pension, government contract issues and commercial or contractual disputes. Although the ultimate outcome of any legal matter cannot be predicted with certainty, based on present information, including management’s assessment of the merits of the particular claims, the Company does not believe it is reasonably possible that any asserted or unasserted legal claims or proceedings, individually or in aggregate, will have a material adverse effect on its results of operations or financial condition.

Segment information	9 Months Ended
Segment information	Sep. 30, 2024
Segment Reporting [Abstract]
Segment information	Segment information The Company follows ASC 280, “Segment Reporting,” which requires that companies disclose segment data based on how management makes decisions about allocating resources to each segment and evaluating their performances. The Company has one reporting segment. The Company’s chief operating decision maker has been identified as the chief executive officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company, and hence the Company has only one reportable segment.

Pay vs Performance Disclosure - USD ($)	3 Months Ended		9 Months Ended
Pay vs Performance Disclosure - USD ($)	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Pay vs Performance Disclosure
Net Income (Loss) Attributable to Parent	$ (550,137)	$ 409,535	$ (798,761)	$ 194,641

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

Summary of significant accounting policies (Policies)

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

Liquidity

•other available sources of financing from other banks and financial institutions;

•sales of additional securities to the public or other investors; and

•financial support from the Company’s shareholders.

Basis of presentation

Principles of consolidation

Use of estimates and assumptions

Foreign currency translation and transaction

Reclassification

Cash

Accounts receivable, net

Inventories, net

Prepayments

Property and equipment, net


			Useful Life
Building			20 years
Leasehold Improvements			Lesser of lease term and expected useful life
Machinery and equipment			3 – 5 years
Furniture and fixtures			3 – 5 years
Vehicles			5 years
Molds			3 – 5 years

Intangible assets, net

for impairment. The Company typically amortizes its intangible assets with definite useful lives on a straight-line basis over the estimated useful lives of ten years.

Impairment for long-lived assets

Leases

Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Fair Value Measurement

•Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

•Level 3 inputs to the valuation methodology are unobservable and significant to the fair value.

Revenue recognition

The Company records receivables related to revenue when it has an unconditional right to invoice and receive payment.

Shipping and Handling Costs

Shipping and handling costs are expensed as incurred and are included in selling and distribution expenses on the accompanying statement of operations.

Share-based compensation

Income Taxes

The Company records interest and penalties on our uncertain tax positions in income tax expense.

As of September 30, 2024, the tax years ended December 31, 2020 through December 31, 2022 for FGI Industries remain open for statutory examination by tax authority.

Non-controlling interests

Comprehensive income (loss)

Earnings (loss) per share

Segment reporting

Recently adopted accounting pronouncements

The Company considers the applicability and impact of all ASUs. ASUs not listed above were assessed and determined not to be applicable.

Nature of business and organization (Tables)

9 Months Ended

Sep. 30, 2024

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Ownership Interests

The accompanying unaudited condensed consolidated financial statements reflect the activities of FGI and each of the following entities after the Reorganization, as described below:

Name

Background

Ownership

FGI Industries Inc.

•A New Jersey corporation

100% owned by FGI

(formerly named Foremost Groups, Inc.)

•Incorporated on January 5, 1988

•Sales and distribution in the United States

FGI Europe Investment Limited

•A British Virgin Islands holding company

100% owned by FGI

•Incorporated on January 1, 2007

FGI International, Limited

•A Hong Kong company

100% owned by FGI

•Incorporated on June 2, 2021

•Sales, sourcing and product development

FGI Canada Ltd.

•A Canadian company

100% owned by FGI Industries Inc.

•Incorporated on October 17, 1997

•Sales and distribution in Canada

FGI Germany GmbH & Co. KG

•A German company

100% owned by FGI Europe Investment Limited

•Incorporated on January 24, 2013

•Sales and distribution in Germany

FGI China, Ltd.

•A PRC limited liability company

100% owned by FGI International, Limited

•Incorporated on August 19, 2021

•Sourcing and product development

FGI United Kingdom Ltd

•An UK company

100% owned by FGI Europe Investment Limited

•Incorporated on December 10, 2021

•Sales and distribution in UK

FGI Australasia Pty Ltd

•An Australian company

100% owned by FGI

•Incorporated on September 8, 2022

•Sales and distribution in Australia

Covered Bridge Cabinetry Manufacturing Co., Ltd

•A Cambodian company

100% owned by FGI

•Incorporated on April 21, 2022

•Manufacturing in Cambodia

Isla Porter LLC

•A New Jersey company

60% owned by FGI Industries Inc.

•Formed on June 2, 2023

•Sales and distribution in the United States

FGI Industries India Private Limited

•An Indian company

100% owned by FGI

•Incorporated on June 11, 2024

•Sales and distribution in India

Schedule of Net Results of Reorganized Operations

The following table sets forth the revenue, cost of revenue and operating expenses that were irrelevant to the K&B Business allocated from FGI Industries to Foremost Home, Inc. for the three and nine months ended September 30, 2024 and 2023, respectively.


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Revenue	$	—	$	—	$	—	$	991,919
Cost of revenue	—		—		—		(768,065)
Gross profit	—		—		—		223,854
Selling and distribution expenses	—		—		—		45,979
General and administrative expenses	—		—		—		—
Research and development expenses	—		—		—		—
Income from operations	$	—	$	—	$	—	$	269,833

Summary of significant accounting policies (Tables)

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

Schedule of Property and Equipment, Net

Estimated useful lives are as follows:


			Useful Life
Building			20 years
Leasehold Improvements			Lesser of lease term and expected useful life
Machinery and equipment			3 – 5 years
Furniture and fixtures			3 – 5 years
Vehicles			5 years
Molds			3 – 5 years

Property and equipment, net consist of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Building	$	946,066	$	946,066
Leasehold Improvements	2,951,116		1,695,361
Machinery and equipment	1,694,957		1,613,439
Furniture and fixtures	278,578		259,449
Vehicles	147,912		147,912
Molds	26,377		26,377
Subtotal	6,045,006		4,688,604
Less: accumulated depreciation	(3,133,593)		(2,778,113)
Prepayment for purchase of equipment and construction-in-progress	45,818		—
Total	$	2,957,231	$	1,910,491

Schedule of Disaggregated Revenues by Product Line

The Company’s disaggregated revenue is summarized as follows:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Revenue by product line
Sanitaryware	$	21,451,387	$	20,740,380	$	59,303,663	$	54,949,082
Bath Furniture	4,162,291		2,531,430		11,282,623		12,304,688
Shower System	7,143,283		4,931,437		18,793,999		14,248,679
Others	3,342,218		1,729,365		6,843,362		4,782,342
Total	$	36,099,179	$	29,932,612	$	96,223,647	$	86,284,791

Schedule of Revenues and Assets by Geographic Location


	Total Revenue								Total Assets
	For the Three Months Ended September 30,				For the Nine Months Ended September 30,				As of September 30,		As of December 31,
	2024		2023		2024		2023		2024		2023
	USD		USD		USD		USD		USD		USD

Revenue/ total assets by geographic location
United States	$	22,195,976	$	18,356,278	$	59,833,465	$	54,921,572	$	48,881,570	$	38,401,665
Canada	9,916,907		9,081,571		26,391,317		23,120,014		15,049,656		17,850,709
Europe	3,418,826		2,460,762		9,273,872		8,209,204		1,176,616		528,068
Rest of World	567,470		34,001		724,993		34,001		9,557,084		8,964,488
Total	$	36,099,179	$	29,932,612	$	96,223,647	$	86,284,791	$	74,664,926	$	65,744,930

Schedule of Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share for the three months ended September 30, 2024 and 2023:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Numerator:
Net (loss) income attributable to FGI Industries Ltd. shareholders	$	(550,137)	$	409,535	$	(798,761)	$	194,641

Denominator:
Weighted-average number of ordinary shares outstanding — basic	9,563,914		9,500,000		9,565,587		9,500,000
Potentially dilutive shares from outstanding options/warrants	—		286,522		—		322,847
Weighted-average number of ordinary shares outstanding — diluted	9,563,914		9,786,522		9,565,587		9,822,847

Earnings (loss) per share — basic	$	(0.06)	$	0.04	$	(0.08)	$	0.02
Earnings (loss) per share — diluted	$	(0.06)	$	0.04	$	(0.08)	$	0.02

Accounts receivable, net (Tables)

9 Months Ended

Sep. 30, 2024

Receivables [Abstract]

Schedule of Accounts Receivable, Net

Accounts receivable, net consisted of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Accounts receivable	$	20,377,488	$	17,184,706
Allowance for credit losses	(133,991)		(244,879)
Accrued defective return and discount	(1,234,259)		(744,284)
Accounts receivable, net	$	19,009,238	$	16,195,543

Schedule of Movements of Allowance for Doubtful Accounts

Movements of allowance for credit losses are as follows:


	For the Nine Months Ended September 30,		For the Year Ended December 31,
	2024		2023
	USD		USD

Beginning balance	$	244,879	$	438,843
Provision (recovery)	79,762		78,640
Write-off	(190,650)		(272,604)
Ending balance	$	133,991	$	244,879

Schedule of Movements of Accrued Defective Return and Discount Accounts

Movements of accrued defective return and discount accounts are as follows:


	For the Nine Months Ended September 30,		For the Year Ended December 31,
	2024		2023
	USD		USD

Beginning balance	$	744,284	$	1,595,838
Provision (recovery)	489,975		(851,554)
Ending balance	$	1,234,259	$	744,284

Inventories, net (Tables)

9 Months Ended

Sep. 30, 2024

Inventory Disclosure [Abstract]

Schedule of Inventories, Net

Inventories, net consisted of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Finished product	$	14,514,881	$	10,565,858
Reserves for slow-moving inventories	(729,372)		(642,006)
Inventories, net	$	13,785,509	$	9,923,852

Movements of inventory reserves are as follows:


	For the Nine Months Ended September 30,		For the Year Ended December 31,
	2024		2023
	USD		USD

Beginning balance	$	642,006	$	663,530
Provision (recovery)	87,366		(21,524)
Ending balance	$	729,372	$	642,006

Prepayments and other assets (Tables)

9 Months Ended

Sep. 30, 2024

Prepaid Expense and Other Assets, Current [Abstract]

Schedule of Prepayments and Other Assets

Prepayments and other assets consisted of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Prepayments	$	2,333,839	$	3,953,340
Others	256,368		664,411
Total prepayments and other assets	$	2,590,207	$	4,617,751

Property and equipment, net (Tables)

9 Months Ended

Sep. 30, 2024

Property, Plant and Equipment [Abstract]

Schedule of Property and Equipment, Net

Estimated useful lives are as follows:


			Useful Life
Building			20 years
Leasehold Improvements			Lesser of lease term and expected useful life
Machinery and equipment			3 – 5 years
Furniture and fixtures			3 – 5 years
Vehicles			5 years
Molds			3 – 5 years

Property and equipment, net consist of the following:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Building	$	946,066	$	946,066
Leasehold Improvements	2,951,116		1,695,361
Machinery and equipment	1,694,957		1,613,439
Furniture and fixtures	278,578		259,449
Vehicles	147,912		147,912
Molds	26,377		26,377
Subtotal	6,045,006		4,688,604
Less: accumulated depreciation	(3,133,593)		(2,778,113)
Prepayment for purchase of equipment and construction-in-progress	45,818		—
Total	$	2,957,231	$	1,910,491

Leases (Tables)

9 Months Ended

Sep. 30, 2024

Leases [Abstract]

Schedule of Leases

The table below presents the operating lease related assets and liabilities recorded on the Company’s consolidated balance sheets:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Operating lease right-of-use assets	$	13,488,342	$	15,203,576
Operating lease liabilities – current	$	1,785,996	$	1,595,998
Operating lease liabilities – noncurrent	12,057,751		13,674,452
Total operating lease liabilities	$	13,843,747	$	15,270,450

Information relating to the lease term and discount rate are as follows:


	As of September 30, 2024		As of December 31, 2023

Weighted-average remaining lease term
Operating leases	9.0 years		9.4 years
Weighted-average discount rate
Operating leases	5.7	%	5.7	%

Schedule of Maturities of Operating Lease Liabilities

As of September 30, 2024, the maturities of operating lease liabilities were as follows:


For the 12 months ending September 30,
2025	$	2,538,099
2026	2,635,492
2027	2,650,249
2028	2,301,432
2029	1,682,400
Thereafter	5,765,659
Total lease payments	17,573,331
Less: imputed interest	(3,729,584)
Present value of lease liabilities	$	13,843,747

Stock-based compensation (Tables)

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Schedule of Restricted Share Units

The following is a summary of the restricted shares granted:


Restricted shares grants						Shares
Non-vested as of January 1, 2023						296,474
Granted						113,984
Vested						(66,111)
Canceled						(87,611)
Non-vested as of December 31, 2023						256,736
Granted						426,687
Vested						(72,112)
Canceled						—
Non-vested as of September 30, 2024						611,311

The following is a summary of the status of restricted shares as of September 30, 2024:


Outstanding Restricted Shares
Fair Value per share		Number	Average Remaining Amortization Period (Years)
$	3.90	61,250	0.33
$	2.52	1,701	0.50
$	2.20	16,363	0.25
$	2.08	96,635	1.50
$	2.08	8,675	1.50
$	1.50	413,354	2.50
$	1.50	13,333	0.25
		611,311

Schedule of Share Option Activities

The following table summarizes the Company’s employee share option activities:


	Number of Options	Weighted Average Exercise Price	Weighted Average Grant Date Fair Value	Weighted Average Remaining Contractual Term	Average Intrinsic Value
		USD	USD	Years	USD
Share options outstanding at December 31, 2023	355,999	2.56	1.20	9.35	—
Granted	697,629	1.46	0.82	10.00	—
Forfeited	—	N/A	N/A	N/A	N/A
Exercised	—	N/A	N/A	N/A	N/A
Expired	—	N/A	N/A	N/A	N/A
Share options outstanding at September 30, 2024	1,053,628	1.83	0.95	8.84	—
Vested and exercisable at September 30, 2024	285,079	2.57	1.21	7.54	—

Schedule of Assumptions Used to Value Options Granted

The assumptions used to value the options granted to employees were as follows:


	April 2024		March 2024		March 2023

Risk-free interest rate (%)	4.54		4.21		3.65
Expected volatility range (%)	55.32		55.11		63.36
Fair market value per ordinary share as at grant dates	$	1.32	$	1.50	$	2.08

Schedule of Share-Based Compensation Expense

The following table sets forth the amount of share-based compensation expense included in each of the relevant financial statement line items:


	For the Nine Months Ended September 30,
	2024		2023
	USD		USD
Selling and distribution expenses	$	116,584	$	93,746
General and administrative expenses	420,013		238,147
Total share-based compensation expenses	$	536,597	$	331,893

Income taxes (Tables)

9 Months Ended

Sep. 30, 2024

Income Tax Disclosure [Abstract]

Schedule of Source of Pre-Tax Income

The source of pre-tax income and the components of income tax expense are as follows:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Income components
United States	$	(1,614,080)	$	(239,835)	$	(3,455,011)	$	(641,733)
Outside United States	1,183,369		755,843		2,186,900		1,166,922
Total pre-tax (loss) income	$	(430,711)	$	516,008	$	(1,268,111)	$	525,189
Provision for income taxes
Current
Federal	$	(12,757)	$	(6,062)	$	(12,219)	$	4,562
State	29,128		7,210		37,553		10,343
Foreign	502,214		223,979		831,959		524,776
	518,585		225,127		857,293		539,681
Deferred
Federal	(154,816)		(42,497)		(572,163)		(135,172)
State	(96,232)		(10,114)		(149,646)		(3,930)
Foreign	—		—		(144,073)		(3,988)
	(251,048)		(52,611)		(865,882)		(143,090)
Total provision for income taxes	$	267,537	$	172,516	$	(8,589)	$	396,591

Schedule of the Components of Income Tax Expense

The source of pre-tax income and the components of income tax expense are as follows:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2024		2023		2024		2023
	USD		USD		USD		USD
Income components
United States	$	(1,614,080)	$	(239,835)	$	(3,455,011)	$	(641,733)
Outside United States	1,183,369		755,843		2,186,900		1,166,922
Total pre-tax (loss) income	$	(430,711)	$	516,008	$	(1,268,111)	$	525,189
Provision for income taxes
Current
Federal	$	(12,757)	$	(6,062)	$	(12,219)	$	4,562
State	29,128		7,210		37,553		10,343
Foreign	502,214		223,979		831,959		524,776
	518,585		225,127		857,293		539,681
Deferred
Federal	(154,816)		(42,497)		(572,163)		(135,172)
State	(96,232)		(10,114)		(149,646)		(3,930)
Foreign	—		—		(144,073)		(3,988)
	(251,048)		(52,611)		(865,882)		(143,090)
Total provision for income taxes	$	267,537	$	172,516	$	(8,589)	$	396,591

Schedule of Reconciliation of Effective Income Tax Rate on Earnings Before Income Taxes

Reconciliations between taxes at the U.S. federal income tax rate and taxes at the Company’s effective income tax rate on earnings before income taxes are as follows:


	For the Nine Months Ended September 30,
	2024	2023
	%	%
Federal statutory rate	21.0	21.0
Increase (decrease) in tax rate resulting from:
State and local income taxes, net of federal benefit	6.1	(1.7)
Foreign operations	(16.2)	21.5
Permanent items	(10.8)	0.7
Deferred adjustments	(0.1)	2.1
Others	0.7	0.1
Effective tax rate	0.7	43.7

Summary of Components of Net Deferred Tax Assets and Liabilities

The following is a summary of the components of the net deferred tax assets and liabilities recognized in the consolidated balance sheets:


	As of September 30, 2024		As of December 31, 2023
	USD		USD

Deferred tax assets
Allowance for credit losses	$	31,996	$	58,476
Other reserve	108,814		61,371
Accrued expenses	146,771		143,823
Lease liability	1,541,398		1,769,328
Charitable contributions	8,306		8,181
Business interest limitation	519,320		242,862
Net operating loss – federal	602,265		310,099
Net operating loss – state	102,852		27,337
Other	195,389		66,063
Total deferred tax assets	3,257,111		2,687,540
Less: valuation allowance	—		—
Net deferred tax assets	3,257,111		2,687,540
Deferred tax liabilities
Fixed assets	1,471,219		1,728,364
Intangibles	(233,765)		(209,657)
Total deferred tax liabilities	1,237,454		1,518,707
Deferred tax assets, net of deferred tax liabilities	$	2,019,657	$	1,168,833

Related party transactions and balances (Tables)

9 Months Ended

Sep. 30, 2024

Sales to a related party


Name of Related Party	Relationship	Nature of Transactions	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
			2024		2023		2024		2023
			USD		USD		USD		USD
Foremost Worldwide Co., Ltd.	An entity under common control	Sales	$	408,977	$	—	$	408,977	$	—
			$	408,977	$	—	$	408,977	$	—

Purchases from related parties


Name of Related Party	Relationship	Nature of Transactions	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
			2024		2023		2024		2023
			USD		USD		USD		USD
Focal Capital Holding Limited	An entity under common control	Purchase	$	1,903,797	$	980,910	$	4,658,602	$	5,950,640
Foremost Worldwide Co., Ltd.	An entity under common control	Purchase	1,883,192		717,188		5,837,250		1,755,577
Rizhao Foremost Woodwork Manufacturing Co., Ltd.	An entity under common control	Purchase	15,874		—		39,943		—
F.P.Z. Furniture (Cambodia) Co., Ltd.	An entity under common control	Purchase	—		575,060		—		575,060
Foremost Australasia Pty Ltd	An entity under common control	Purchase	—		413,339		—		413,339
			$	3,802,863	$	2,686,497	$	10,535,795	$	8,694,616

The ending balance of such transactions as of September 30, 2024 and December 31, 2023 are listed of the following:

Prepayments — related parties


Name of Related Party	As of September 30, 2024		As of December 31, 2023
	USD		USD

Focal Capital Holding Limited	$	12,043,142	$	6,658,498
Rizhao Foremost Woodwork Manufacturing Co., Ltd.	24,364		9,181
	$	12,067,506	$	6,667,679

Accounts Payables — related parties


Name of Related Party	As of September 30, 2024		As of December 31, 2023
	USD		USD

Foremost Worldwide Co., Ltd.	$	5,053	$	735,308
	$	5,053	$	735,308

Other Receivables (Payables) — related parties

Name of Related Party

Relationship

Nature of
Transactions

As of
September 30,
2024

As of
December 31,
2023

USD

Foremost Home Inc. (“FHI”)

An entity under common control

Shared services and Miscellaneous expenses

2,215,919

1,183,612

Foremost Worldwide Co., Ltd.

An entity under common control

Shared services and Miscellaneous expenses

(45,026)

(251,008)

Focal Capital Holding Limited

An entity under common control

Shared services and Miscellaneous expenses

(11,306)

—

F.P.Z. Furniture (Cambodia) Co., Ltd.

An entity under common control

Shared services and Miscellaneous expenses

(257,130)

—

1,902,457

932,604

Nature of business and organization - Ownership by Parent (Details)	Sep. 30, 2024	Jan. 27, 2022
FGI Industries Inc.
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%
FGI Europe Investment Limited
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%	100.00%
FGI International, Limited
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%	100.00%
FGI Australasia Pty Ltd
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%
Covered Bridge Cabinetry Manufacturing Co., Ltd
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%
FGI Industries India Private Limited
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%
FGI Industries Inc. \| FGI Canada Ltd.
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%
FGI Industries Inc. \| Isla Porter LLC
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	60.00%
FGI Europe Investment Limited \| FGI Germany GmbH & Co. KG
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%
FGI Europe Investment Limited \| FGI United Kingdom Ltd
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%
FGI International, Limited \| FGI China, Ltd.
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%

Nature of business and organization - Reorganization - General Information (Details)	Jan. 27, 2022	Sep. 30, 2024
Noncontrolling Interest [Line Items]
Percentage of outstanding stock expected to be distributed (as a percent)	100.00%
Percentage of outstanding stock expected to be contributed (as a percent)	100.00%
FGI Industries Ltd.
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%
FGI Europe Investment Limited
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%	100.00%
FGI International, Limited
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%	100.00%
Foremost Groups Ltd. \| FGI Industries Ltd.
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%
Foremost Groups Ltd. \| Foremost Australasia Pty Ltd
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%
Foremost Australasia Pty Ltd \| Foremost Kingbetter Food Equipment Inc.
Noncontrolling Interest [Line Items]
Ownership percentage (as a percent)	100.00%

Nature of business and organization - Reorganization - Shared Services Agreement (Details)	Jan. 14, 2022 USD ($)
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Annual fee	$ 500,000
Annual fee percent (as a percent)	4.00%
Term of shared service agreement	1 year
Notice period for renewal of agreement	60 days

Nature of business and organization - Reorganization - Schedule of Revenue, Cost of Revenue and Operating Expenses (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Schedule of Reorganization, Net Results [Line Items]
Revenue	$ 36,099,179	$ 29,932,612	$ 96,223,647	$ 86,284,791
Cost of revenue	(26,790,957)	(22,103,325)	(69,538,640)	(63,242,944)
Gross profit	9,308,222	7,829,287	26,685,007	23,041,847
Selling and distribution expenses	6,284,932	4,572,593	18,676,665	14,084,200
General and administrative expenses	2,637,141	2,351,307	7,542,019	6,746,055
Research and development expenses	451,975	423,697	1,303,445	1,152,554
(Loss) income from operations	(65,826)	481,690	(837,122)	1,059,038
Business Allocated from FGI Industries to Foremost Home, Inc.
Schedule of Reorganization, Net Results [Line Items]
Revenue	0	0	0	991,919
Cost of revenue	0	0	0	(768,065)
Gross profit	0	0	0	223,854
Selling and distribution expenses	0	0	0	45,979
General and administrative expenses	0	0	0	0
Research and development expenses	0	0	0	0
(Loss) income from operations	$ 0	$ 0	$ 0	$ 269,833

Summary of significant accounting policies - Liquidity (Details) $ in Millions	Sep. 30, 2024 USD ($)
Accounting Policies [Abstract]
Cash and cash equivalents	$ 3.0

Summary of significant accounting policies - Foreign Currency Translation and Transaction (Details)	3 Months Ended						9 Months Ended
	Sep. 30, 2024 ¥ / $	Sep. 30, 2024 ¥ / $ $ / $	Sep. 30, 2024 ¥ / $ € / $	Sep. 30, 2023 ¥ / $	Sep. 30, 2023 $ / $	Sep. 30, 2023 € / $	Sep. 30, 2024 ¥ / $	Sep. 30, 2024 ¥ / $ $ / $	Sep. 30, 2024 ¥ / $ € / $	Sep. 30, 2023 ¥ / $	Sep. 30, 2023 $ / $	Sep. 30, 2023 € / $	Sep. 30, 2024 $ / $	Sep. 30, 2024 € / $	Dec. 31, 2023 ¥ / $	Dec. 31, 2023 $ / $	Dec. 31, 2023 € / $
Accounting Policies [Abstract]
Exchange rate on the balance sheet date	6.9939	6.9939	6.9939				6.9939	6.9939	6.9939				1.3700	0.8956	7.1006	1.3246	0.9059
Average exchange rate	7.2080	1.3700	0.9207	7.2414	1.3541	0.9143	7.2111	1.3448	0.9220	7.0384	1.3541	0.9227

Summary of significant accounting policies - Cash (Details) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Accounting Policies [Abstract]
Cash equivalents	$ 0	$ 0

Summary of significant accounting policies - Property and Equipment, Net (Details)	Sep. 30, 2024
Building
Property, Plant and Equipment [Line Items]
Useful Life	20 years
Leasehold Improvements
Property, Plant and Equipment [Line Items]
Estimated useful life	Useful Life, Shorter of Lease Term or Asset Utility [Member]
Machinery and equipment \| Minimum
Property, Plant and Equipment [Line Items]
Useful Life	3 years
Machinery and equipment \| Maximum
Property, Plant and Equipment [Line Items]
Useful Life	5 years
Furniture and fixtures \| Minimum
Property, Plant and Equipment [Line Items]
Useful Life	3 years
Furniture and fixtures \| Maximum
Property, Plant and Equipment [Line Items]
Useful Life	5 years
Vehicles
Property, Plant and Equipment [Line Items]
Useful Life	5 years
Molds \| Minimum
Property, Plant and Equipment [Line Items]
Useful Life	3 years
Molds \| Maximum
Property, Plant and Equipment [Line Items]
Useful Life	5 years

Summary of significant accounting policies - Intangible Assets, Net (Details)	Sep. 30, 2024
Accounting Policies [Abstract]
Useful lives of intangible assets	10 years

Summary of significant accounting policies - Impairment for Long-lived Assets (Details) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Accounting Policies [Abstract]
Impairment of long-lived assets	$ 0	$ 0

Summary of significant accounting policies - Revenues - General Information (Details)	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Customer payment term, low end of range	15 days
Customer payment term, high end of range	60 days

Summary of significant accounting policies - Revenues - Disaggregation by Product Line (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Disaggregation of Revenue [Line Items]
Revenue	$ 36,099,179	$ 29,932,612	$ 96,223,647	$ 86,284,791
Sanitaryware
Disaggregation of Revenue [Line Items]
Revenue	21,451,387	20,740,380	59,303,663	54,949,082
Bath Furniture
Disaggregation of Revenue [Line Items]
Revenue	4,162,291	2,531,430	11,282,623	12,304,688
Shower System
Disaggregation of Revenue [Line Items]
Revenue	7,143,283	4,931,437	18,793,999	14,248,679
Others
Disaggregation of Revenue [Line Items]
Revenue	$ 3,342,218	$ 1,729,365	$ 6,843,362	$ 4,782,342

Summary of significant accounting policies - Revenues - Disaggregation by Geographic Location (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 36,099,179	$ 29,932,612	$ 96,223,647	$ 86,284,791
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	22,195,976	18,356,278	59,833,465	54,921,572
Canada
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	9,916,907	9,081,571	26,391,317	23,120,014
Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	3,418,826	2,460,762	9,273,872	8,209,204
Rest of World
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 567,470	$ 34,001	$ 724,993	$ 34,001

Summary of significant accounting policies - Assets by Geographic Location (Details) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Assets	$ 74,664,926	$ 65,744,930
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Assets	48,881,570	38,401,665
Canada
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Assets	15,049,656	17,850,709
Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Assets	1,176,616	528,068
Rest of World
Revenues from External Customers and Long-Lived Assets [Line Items]
Total Assets	$ 9,557,084	$ 8,964,488

Summary of significant accounting policies - Shipping and Handling Costs (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Accounting Policies [Abstract]
Shipping and handling expense	$ 288,657	$ 176,077	$ 804,388	$ 490,161

Summary of significant accounting policies - Share-based Compensation (Details) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended
	Jan. 26, 2022	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Accounting Policies [Abstract]
Total share-based compensation expenses	$ 0	$ 208,506	$ 59,337	$ 536,597	$ 331,893

Summary of significant accounting policies - Income Taxes (Details)	9 Months Ended
	Sep. 30, 2024
Accounting Policies [Abstract]
Open tax year	2020 2021 2022

Summary of significant accounting policies - Non-controlling Interests (Details)	Sep. 30, 2024
Isla Porter LLC
Noncontrolling Interest [Line Items]
Percentage of non-controlling interests	40.00%

Summary of significant accounting policies - Earnings (Loss) Per Share (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Numerator:
Net (loss) income attributable to FGI Industries Ltd. shareholders - basic	$ (550,137)	$ 409,535	$ (798,761)	$ 194,641
Net (loss) income attributable to FGI Industries Ltd. shareholders - diluted	$ (550,137)	$ 409,535	$ (798,761)	$ 194,641
Denominator:
Weighted-average number of ordinary shares outstanding - basic (in shares)	9,563,914	9,500,000	9,565,587	9,500,000
Potentially dilutive shares from outstanding options/warrants (in shares)	0	286,522	0	322,847
Weighted-average number of ordinary shares outstanding - diluted (in shares)	9,563,914	9,786,522	9,565,587	9,822,847
(Loss) earnings per share
Earnings (loss) per share - basic (in dollars per share)	$ (0.06)	$ 0.04	$ (0.08)	$ 0.02
Earnings (loss) per share - diluted (in dollars per share)	$ (0.06)	$ 0.04	$ (0.08)	$ 0.02

Accounts receivable, net - Composition (Details) - USD ($)	Sep. 30, 2024	Dec. 31, 2023	Dec. 31, 2022
Receivables [Abstract]
Accounts receivable	$ 20,377,488	$ 17,184,706
Allowance for credit losses	(133,991)	(244,879)	$ (438,843)
Accrued defective return and discount	(1,234,259)	(744,284)	$ (1,595,838)
Accounts receivable, net	$ 19,009,238	$ 16,195,543

Accounts receivable, net - Allowance for Doubtful Accounts Roll Forward (Details) - USD ($)	9 Months Ended		12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	$ 244,879	$ 438,843	$ 438,843
Provision (recovery)	79,762	$ 31,324	78,640
Write-off	(190,650)		(272,604)
Ending balance	$ 133,991		$ 244,879

Accounts receivable, net - Accrued Defective Return and Discount Accounts Roll Forward (Details) - USD ($)	9 Months Ended		12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Accounts Receivable, Accrued Defective Return and Discount, Current [Roll Forward]
Beginning balance	$ 744,284	$ 1,595,838	$ 1,595,838
Provision (recovery)	489,975	$ (710,643)	(851,554)
Ending balance	$ 1,234,259		$ 744,284

Inventories, net - Composition (Details) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Inventory Disclosure [Abstract]
Finished product	$ 14,514,881	$ 10,565,858
Reserves for slow-moving inventories	(729,372)	(642,006)
Inventories, net	$ 13,785,509	$ 9,923,852

Inventories, net - Inventory Reserves Roll Forward (Details) - SEC Schedule, 12-09, Reserve, Inventory - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward]
Beginning balance	$ 642,006	$ 663,530
Provision (recovery)	87,366	(21,524)
Ending balance	$ 729,372	$ 642,006

Prepayments and other assets (Details) - Nonrelated Party - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Prepaid Expenses and Other Assets [Line Items]
Prepayments	$ 2,333,839	$ 3,953,340
Others	256,368	664,411
Total prepayments and other assets	$ 2,590,207	$ 4,617,751

Property and equipment, net - Schedule of Property and Equipment, net (Details) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Gross property and equipment, net	$ 6,045,006	$ 4,688,604
Less: accumulated depreciation	(3,133,593)	(2,778,113)
Prepayment for purchase of equipment and construction-in-progress	45,818	0
Total	2,957,231	1,910,491
Building
Property, Plant and Equipment [Line Items]
Gross property and equipment, net	946,066	946,066
Leasehold Improvements
Property, Plant and Equipment [Line Items]
Gross property and equipment, net	2,951,116	1,695,361
Machinery and equipment
Property, Plant and Equipment [Line Items]
Gross property and equipment, net	1,694,957	1,613,439
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Gross property and equipment, net	278,578	259,449
Vehicles
Property, Plant and Equipment [Line Items]
Gross property and equipment, net	147,912	147,912
Molds
Property, Plant and Equipment [Line Items]
Gross property and equipment, net	$ 26,377	$ 26,377

Property and equipment, net - Depreciation Expense (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 125,244	$ 56,497	$ 324,683	$ 135,256

Leases - Narrative (Details) - USD ($)	3 Months Ended		9 Months Ended
Leases - Narrative (Details) - USD ($)	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Related Party Transaction [Line Items]
Total lease expenses	$ 699,646	$ 697,205	$ 2,099,500	$ 1,862,939
Building
Related Party Transaction [Line Items]
Leases, remaining lease terms	10 years 6 months		10 years 6 months
Land
Related Party Transaction [Line Items]
Leases, remaining lease terms	47 years 9 months		47 years 9 months
Lessee, operating lease, renewal term	50 years		50 years
Lessee, operating lease, renewal term, purchase amount	$ 1		$ 1

Leases - Assets and Liabilities (Details) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Leases [Abstract]
Operating lease right-of-use assets	$ 13,488,342	$ 15,203,576
Operating lease liabilities – current	1,785,996	1,595,998
Operating lease liabilities – noncurrent	12,057,751	13,674,452
Total operating lease liabilities	$ 13,843,747	$ 15,270,450

Leases - Lease Term and Discount Rate (Details)	Sep. 30, 2024	Dec. 31, 2023
Leases [Abstract]
Weighted-average remaining lease term, Operating leases	9 years	9 years 4 months 24 days
Weighted-average discount rate, Operating leases	5.70%	5.70%

Leases - Maturities of Operating Lease Liabilities (Details) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Leases [Abstract]
2025	$ 2,538,099
2026	2,635,492
2027	2,650,249
2028	2,301,432
2029	1,682,400
Thereafter	5,765,659
Total lease payments	17,573,331
Less: imputed interest	(3,729,584)
Present value of lease liabilities	$ 13,843,747	$ 15,270,450

Short-term loans (Details) $ in Millions		9 Months Ended
Short-term loans (Details) $ in Millions	Jan. 25, 2024 USD ($)	Sep. 30, 2024 USD ($)	Sep. 30, 2024 CAD ($)	Dec. 31, 2023 USD ($)
Short-Term Debt [Line Items]
Short-term loans		$ 12,485,497		$ 6,959,175
Line of Credit \| Non-discretionary Line of Credit
Short-Term Debt [Line Items]
Maximum borrowing capacity		$ 18,000,000
Debt coverage ratio		1.25
Tangible net worth		$ 10,000,000
Tangible net worth ratio		4.0
Interest rate (as a percent)		7.75%	7.75%	8.25%
Short-term loans		$ 9,161,641		$ 6,959,175
Line of Credit \| Non-discretionary Line of Credit \| Minimum
Short-Term Debt [Line Items]
Interest rate (as a percent)		4.50%	4.50%
Line of Credit \| Non-discretionary Line of Credit \| Secured Overnight Financing Rate (SOFR)
Short-Term Debt [Line Items]
Basis spread (as a percent)		2.20%
Line of Credit \| Non-discretionary Line of Credit \| Prime Rate
Short-Term Debt [Line Items]
Basis spread (as a percent)		(0.25%)
Line of Credit \| Discretionary Line of Credit
Short-Term Debt [Line Items]
Maximum borrowing capacity		$ 5,474,453	$ 7.5
Tangible net worth ratio		3.00
Short-term loans		$ 1,026,392		0
Current ratio		1.25	1.25
Line of credit facility, expiration, notice period		60 days
Line of Credit \| Discretionary Line of Credit \| Prime Rate
Short-Term Debt [Line Items]
Basis spread (as a percent)		0.50%
Line of Credit \| Revolving Foreign Exchange Facility
Short-Term Debt [Line Items]
Maximum borrowing capacity		$ 3,000,000
Line of Credit \| CTBC Bank Co, Ltd Omnibus Credit Line
Short-Term Debt [Line Items]
Maximum borrowing capacity	$ 2,300,000
Basis spread (as a percent)	1.20%
Short-term loans		$ 2,297,464		$ 0
Borrowing limit, percentage of export "open account" trade receivables (as a percent)	90.00%
Mr. Liang Chou Chen \| Foremost Groups Ltd.
Short-Term Debt [Line Items]
Ownership percentage (as a percent)		49.89%	49.89%

Shareholders' Equity - General Information (Details) - USD ($) $ / shares in Units, $ in Thousands	Sep. 30, 2024	Dec. 31, 2023	Jan. 27, 2022	May 26, 2021
Equity [Abstract]
Ordinary shares, authorized (in shares)	200,000,000	200,000,000	200,000,000	50,000,000
Ordinary shares, par value (in dollars per share)	$ 0.0001	$ 0.0001	$ 0.0001	$ 0.001
Authorized amount			$ 21
Preference shares, authorized (in shares)	10,000,000	10,000,000	10,000,000
Preference shares, par value (in dollars per share)	$ 0.0001	$ 0.0001	$ 0.0001
Ordinary shares, issued (in shares)	9,563,914	9,547,607	9,500,000
Ordinary shares, outstanding (in shares)	9,563,914	9,547,607	9,500,000

Shareholders' Equity - Offerings (Details)	Jan. 27, 2022 USD ($) $ / shares yr shares	Jan. 25, 2022 $ / shares shares	Sep. 30, 2024 $ / shares shares	Dec. 31, 2023 $ / shares shares	May 26, 2021 $ / shares
Subsidiary, Sale of Stock [Line Items]
Ordinary shares, par value (in dollars per share) \| $ / shares	$ 0.0001		$ 0.0001	$ 0.0001	$ 0.001
Gross proceeds from the IPO \| $	$ 15,000,000.0
Net proceeds from issuance of ordinary shares in IPO \| $	$ 12,400,000
Ordinary shares, issued (in shares)	9,500,000		9,563,914	9,547,607
Ordinary shares, outstanding (in shares)	9,500,000		9,563,914	9,547,607
IPO
Subsidiary, Sale of Stock [Line Items]
Stock issued during period, shares, new issues (in shares)	2,500,000
Issuance of ordinary shares per unit upon Initial Public Offering ("IPO") (in shares)	1
Share price (in dollars per share) \| $ / shares	$ 6.00
Over-Allotment Option
Subsidiary, Sale of Stock [Line Items]
Underwriters' option period		45 days
Number of shares issuable (in shares)		375,000
Initial Public Offering Warrants to Purchase Ordinary Shares
Subsidiary, Sale of Stock [Line Items]
Number of shares called warrants (in shares)	1
Number of shares called by each warrant (in shares)	1
Exercise price of warrants (in dollars per share) \| $ / shares	$ 6.00
Term of warrants	5 years
Initial Public Offering Option Warrants to Purchase Ordinary Shares
Subsidiary, Sale of Stock [Line Items]
Number of shares called warrants (in shares)		375,000
Exercise price of warrants (in dollars per share) \| $ / shares		$ 0.01
Public Offering Warrants to Purchase Ordinary Shares
Subsidiary, Sale of Stock [Line Items]
Number of shares called warrants (in shares)	50,000
Term of warrants	5 years
Warrants, fair value \| $	$ 100,000
Warrants outstanding (in shares)			50,000
Warrants exercised (in shares)			0
Public Offering Warrants to Purchase Ordinary Shares \| Measurement Input, Share Price
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input \| $ / shares	1.448
Public Offering Warrants to Purchase Ordinary Shares \| Measurement Input, Risk Free Interest Rate
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input	0.0166
Public Offering Warrants to Purchase Ordinary Shares \| Measurement Input, Expected Term
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input \| yr	5
Public Offering Warrants to Purchase Ordinary Shares \| Measurement Input, Exercise Price
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input \| $ / shares	6.00
Public Offering Warrants to Purchase Ordinary Shares \| Measurement Input, Price Volatility
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input	0.4400
Public Offering Warrants to Purchase Ordinary Shares \| Measurement Input, Expected Dividend Payment
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input \| $	0
Initial Public Offering Warrants and Option Warrants to Purchase Ordinary Shares
Subsidiary, Sale of Stock [Line Items]
Warrants, fair value \| $	$ 4,160,000
Warrants outstanding (in shares)			2,875,000
Warrants exercised (in shares)			0
Initial Public Offering Warrants and Option Warrants to Purchase Ordinary Shares \| Measurement Input, Share Price
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input \| $ / shares	1.448
Initial Public Offering Warrants and Option Warrants to Purchase Ordinary Shares \| Measurement Input, Risk Free Interest Rate
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input	0.0166
Initial Public Offering Warrants and Option Warrants to Purchase Ordinary Shares \| Measurement Input, Expected Term
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input \| yr	5
Initial Public Offering Warrants and Option Warrants to Purchase Ordinary Shares \| Measurement Input, Exercise Price
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input \| $ / shares	6.00
Initial Public Offering Warrants and Option Warrants to Purchase Ordinary Shares \| Measurement Input, Price Volatility
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input	0.4400
Initial Public Offering Warrants and Option Warrants to Purchase Ordinary Shares \| Measurement Input, Expected Dividend Payment
Subsidiary, Sale of Stock [Line Items]
Warrants and rights outstanding, measurement input \| $	0

Shareholders' Equity - Warrants - General Information (Details) - Public Offering Warrants to Purchase Ordinary Shares	Jan. 27, 2022 USD ($) $ / shares yr shares	Sep. 30, 2024 shares
Class of Warrant or Right [Line Items]
Warrants issued, percentage of IPO shares (as a percent)	2.00%
Number of shares called warrants (in shares)	50,000
Term of warrants	5 years
Date from which warrants exercisable, period from IPO closing	180 days
Warrants, fair value \| $	$ 100,000
Warrants outstanding (in shares)		50,000
Warrants exercised (in shares)		0
Measurement Input, Share Price
Class of Warrant or Right [Line Items]
Warrants and rights outstanding, measurement input \| $ / shares	1.448
Measurement Input, Risk Free Interest Rate
Class of Warrant or Right [Line Items]
Warrants and rights outstanding, measurement input	0.0166
Measurement Input, Expected Term
Class of Warrant or Right [Line Items]
Warrants and rights outstanding, measurement input \| yr	5
Measurement Input, Exercise Price
Class of Warrant or Right [Line Items]
Warrants and rights outstanding, measurement input \| $ / shares	6.00
Measurement Input, Price Volatility
Class of Warrant or Right [Line Items]
Warrants and rights outstanding, measurement input	0.4400
Measurement Input, Expected Dividend Payment
Class of Warrant or Right [Line Items]
Warrants and rights outstanding, measurement input \| $	0

Stock-based compensation - General Information (Details) - USD ($)		1 Months Ended	3 Months Ended		9 Months Ended
	Oct. 07, 2021	Jan. 26, 2022	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Compensation cost recognized		$ 0	$ 208,506	$ 59,337	$ 536,597	$ 331,893
Equity Plan 2021
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Shares reserved (in shares)	1,500,000
Threshold percentage (as a percent)	4.50%
Threshold number of shares (in shares)	600,000

Stock-based compensation - Restricted Share Units - General Information (Details) - Restricted Stock Units (RSUs)	1 Months Ended						9 Months Ended	12 Months Ended
	Apr. 30, 2024 USD ($) shares	Mar. 31, 2024 USD ($) shares	Mar. 31, 2023 USD ($) shares	May 31, 2022 USD ($) shares	Apr. 30, 2022 USD ($) installment shares	Jan. 31, 2022 USD ($) shares	Sep. 30, 2024 shares	Dec. 31, 2023 shares	Apr. 01, 2024 $ / shares	Mar. 22, 2024 $ / shares	Mar. 29, 2023 $ / shares	May 17, 2022 $ / shares	May 11, 2022 $ / shares	Apr. 13, 2022 $ / shares	Jan. 27, 2022 $ / shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted (in shares)							426,687	113,984
RSU Vested							72,112	66,111
Awards Issued 27 January 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted (in shares)						183,750
Fair value of awards granted \| $						$ 716,625
Share price (in dollars per share) \| $ / shares															$ 3.90
Vesting period						3 years
RSU Vested							122,500
Awards Issued 27 January 2022 \| Share-Based Payment Arrangement, Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Percentage of award						33.33%
Awards Issued 13 April 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted (in shares)					8,750
Fair value of awards granted \| $					$ 22,050
Share price (in dollars per share) \| $ / shares														$ 2.52
Vested (in shares)							7,049
Awards Issued 13 April 2022 \| Share-Based Payment Arrangement, Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Percentage of award					33.33%
Vesting period					1 year
Awards Issued 13 April 2022 \| Share-Based Payment Arrangement, Tranche Two
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights, successive equal monthly installments \| installment					24
Awards Issued 11 May 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted (in shares)				87,611
Fair value of awards granted \| $				$ 198,000
Share price (in dollars per share) \| $ / shares													$ 2.26
Vested (in shares)							0
Potential award (in shares)				43,805
Potential award, fair value \| $				$ 99,000
Awards Issued 17 May 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted (in shares)				16,363
Fair value of awards granted \| $				$ 36,000
Share price (in dollars per share) \| $ / shares												$ 2.20
Vested (in shares)							0
Awards Issued 29 March 2023, Officers
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted (in shares)			96,635
Fair value of awards granted \| $			$ 201,000
Share price (in dollars per share) \| $ / shares											$ 2.08
Vested (in shares)							0
Potential award (in shares)			48,317
Potential award, fair value \| $			$ 100,500
Awards Issued 29 March 2023, Independent Directors
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted (in shares)			17,349
Fair value of awards granted \| $			$ 36,000
Share price (in dollars per share) \| $ / shares											$ 2.08
Vested (in shares)							8,675
Awards Issued 22 March 2024
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted (in shares)		413,354
Fair value of awards granted \| $		$ 620,031
Share price (in dollars per share) \| $ / shares										$ 1.50
Vested (in shares)							0
Potential award (in shares)		206,677
Potential award, fair value \| $		$ 310,016
Awards Issued April 2024
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Granted (in shares)	13,333
Fair value of awards granted \| $	$ 20,000
Share price (in dollars per share) \| $ / shares									$ 1.50
Vested (in shares)							0
Potential award (in shares)	6,667
Potential award, fair value \| $	$ 10,000

Stock-based compensation - Restricted Share Units - Activity (Details) - Restricted Stock Units (RSUs) - shares	9 Months Ended	12 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Shares
Non-vested, beginning balance (in shares)	256,736	296,474
Granted (in shares)	426,687	113,984
Vested (in shares)	(72,112)	(66,111)
Canceled (in shares)	0	(87,611)
Non-vested, ending balance (in shares)	611,311	256,736

Stock-based compensation - Restricted Share Units - Summary (Details) - Restricted Stock Units (RSUs) - $ / shares	9 Months Ended
	Sep. 30, 2024	Dec. 31, 2023	Dec. 31, 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Outstanding Number (in shares)	611,311	256,736	296,474
Awards Issued 27 January 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair Value per share (in dollars per share)	$ 3.90
Outstanding Number (in shares)	61,250
Average Remaining Amortization Period (Years)	3 months 29 days
Awards Issued 13 April 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair Value per share (in dollars per share)	$ 2.52
Outstanding Number (in shares)	1,701
Average Remaining Amortization Period (Years)	6 months
Awards Issued 17 May 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair Value per share (in dollars per share)	$ 2.20
Outstanding Number (in shares)	16,363
Average Remaining Amortization Period (Years)	3 months
Awards Issued 29 March 2023, Officers
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair Value per share (in dollars per share)	$ 2.08
Outstanding Number (in shares)	96,635
Average Remaining Amortization Period (Years)	1 year 6 months
Awards Issued 29 March 2023, Independent Directors
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair Value per share (in dollars per share)	$ 2.08
Outstanding Number (in shares)	8,675
Average Remaining Amortization Period (Years)	1 year 6 months
Awards Issued 22 March 2024
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair Value per share (in dollars per share)	$ 1.50
Outstanding Number (in shares)	413,354
Average Remaining Amortization Period (Years)	2 years 6 months
Awards Issued April 2024
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair Value per share (in dollars per share)	$ 1.50
Outstanding Number (in shares)	13,333
Average Remaining Amortization Period (Years)	3 months

Stock-based compensation - Options - General Information (Details)	1 Months Ended							9 Months Ended
	Apr. 30, 2024 USD ($) installment $ / shares shares	Mar. 31, 2024 USD ($) installment $ / shares shares	Mar. 31, 2023 USD ($) installment $ / shares shares	May 31, 2022 USD ($) installment $ / shares shares	Apr. 30, 2022 USD ($) installment $ / shares shares	Mar. 31, 2022 USD ($) installment $ / shares shares	Jan. 31, 2022 USD ($)	Sep. 30, 2024 USD ($) $ / shares shares	Sep. 30, 2023 USD ($)
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options issued (in shares) \| shares								697,629
Options issued, exercise price (in dollars per share)								$ 1.46
Weighted average grant date fair value, granted (in dollars per share)								$ 0.82
Awards Issued 24 March 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options issued (in shares) \| shares						98,747
Options issued, exercise price (in dollars per share)						$ 3.07
Weighted average grant date fair value, granted (in dollars per share)						$ 1.43
Awards Issued 13 April 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options issued (in shares) \| shares					97,371
Options issued, exercise price (in dollars per share)					$ 2.52
Weighted average grant date fair value, granted (in dollars per share)					$ 1.18
Awards Issued 11 May 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options issued (in shares) \| shares				159,881
Options issued, exercise price (in dollars per share)				$ 2.26
Weighted average grant date fair value, granted (in dollars per share)				$ 1.07
Awards Issued 29 March 2023, Officers
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options issued (in shares) \| shares			158,976
Options issued, exercise price (in dollars per share)			$ 2.08
Weighted average grant date fair value, granted (in dollars per share)			$ 1.26
Awards Issued 22 March 2024
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options issued (in shares) \| shares		529,635
Options issued, exercise price (in dollars per share)		$ 1.50
Weighted average grant date fair value, granted (in dollars per share)		$ 0.84
Awards Issued April 2024
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Options issued (in shares) \| shares	167,994
Options issued, exercise price (in dollars per share)	$ 1.32
Weighted average grant date fair value, granted (in dollars per share)	$ 0.75
Vested (in shares) \| shares								0
Employee Stock Option
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of awards granted \| $								$ 573,163	$ 201,000
Employee Stock Option \| Awards Issued 24 March 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Contractual life						10 years
Fair value of awards granted \| $						$ 141,401
Vested (in shares) \| shares								82,289
Employee Stock Option \| Awards Issued 24 March 2022 \| Share-Based Payment Arrangement, Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)						33.33%
Vesting period						1 year
Employee Stock Option \| Awards Issued 24 March 2022 \| Share-Based Payment Arrangement, Tranche Two
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights, successive equal monthly installments \| installment						24
Employee Stock Option \| Awards Issued 24 March 2022 \| Share-Based Payment Arrangement, Tranche Two Through Twenty-Five
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)						2.78%
Employee Stock Option \| Awards Issued 13 April 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Contractual life					10 years
Fair value of awards granted \| $					$ 114,972
Vested (in shares) \| shares								78,438
Employee Stock Option \| Awards Issued 13 April 2022 \| Share-Based Payment Arrangement, Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)					33.33%
Vesting period					1 year
Employee Stock Option \| Awards Issued 13 April 2022 \| Share-Based Payment Arrangement, Tranche Two
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights, successive equal monthly installments \| installment					24
Employee Stock Option \| Awards Issued 13 April 2022 \| Share-Based Payment Arrangement, Tranche Two Through Twenty-Five
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)					2.78%
Employee Stock Option \| Awards Issued 11 May 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Contractual life				10 years
Fair value of awards granted \| $				$ 171,462
Vested (in shares) \| shares								124,352
Employee Stock Option \| Awards Issued 11 May 2022 \| Share-Based Payment Arrangement, Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)				33.33%
Vesting period				1 year
Employee Stock Option \| Awards Issued 11 May 2022 \| Share-Based Payment Arrangement, Tranche Two
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights, successive equal monthly installments \| installment				24
Employee Stock Option \| Awards Issued 11 May 2022 \| Share-Based Payment Arrangement, Tranche Two Through Twenty-Five
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)				2.78%
Employee Stock Option \| Awards Issued 29 March 2023, Officers
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Contractual life			10 years
Fair value of awards granted \| $			$ 201,000
Vested (in shares) \| shares								0
Employee Stock Option \| Awards Issued 29 March 2023, Officers \| Share-Based Payment Arrangement, Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)			33.33%
Vesting period			1 year
Employee Stock Option \| Awards Issued 29 March 2023, Officers \| Share-Based Payment Arrangement, Tranche Two
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights, successive equal monthly installments \| installment			24
Employee Stock Option \| Awards Issued 29 March 2023, Officers \| Share-Based Payment Arrangement, Tranche Two Through Twenty-Five
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)			2.78%
Employee Stock Option \| Awards Issued 22 March 2024
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Contractual life		10 years
Fair value of awards granted \| $		$ 447,000
Vested (in shares) \| shares								0
Employee Stock Option \| Awards Issued 22 March 2024 \| Share-Based Payment Arrangement, Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)		33.33%
Vesting period		1 year
Employee Stock Option \| Awards Issued 22 March 2024 \| Share-Based Payment Arrangement, Tranche Two
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights, successive equal monthly installments \| installment		24
Employee Stock Option \| Awards Issued 22 March 2024 \| Share-Based Payment Arrangement, Tranche Two Through Twenty-Five
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)		2.78%
Employee Stock Option \| Awards Issued April 2024
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Contractual life	10 years
Fair value of awards granted \| $	$ 126,163
Employee Stock Option \| Awards Issued April 2024 \| Share-Based Payment Arrangement, Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)	33.33%
Vesting period	1 year
Employee Stock Option \| Awards Issued April 2024 \| Share-Based Payment Arrangement, Tranche Two
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights, successive equal monthly installments \| installment	24
Employee Stock Option \| Awards Issued April 2024 \| Share-Based Payment Arrangement, Tranche Two Through Twenty-Five
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights (as a percent)	2.78%
Restricted Stock Units (RSUs) \| Awards Issued 13 April 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of awards granted \| $					$ 22,050
Restricted Stock Units (RSUs) \| Awards Issued 13 April 2022 \| Share-Based Payment Arrangement, Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting period					1 year
Percentage of award					33.33%
Restricted Stock Units (RSUs) \| Awards Issued 13 April 2022 \| Share-Based Payment Arrangement, Tranche Two
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Vesting rights, successive equal monthly installments \| installment					24
Restricted Stock Units (RSUs) \| Awards Issued 13 April 2022 \| Share-Based Payment Arrangement, Tranche Two Through Twenty-Five
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Percentage of award					2.78%
Restricted Stock Units (RSUs) \| Awards Issued 11 May 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of awards granted \| $				$ 198,000
Restricted Stock Units (RSUs) \| Awards Issued 29 March 2023, Officers
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of awards granted \| $			$ 201,000
Restricted Stock Units (RSUs) \| Awards Issued 22 March 2024
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of awards granted \| $		$ 620,031
Restricted Stock Units (RSUs) \| Awards Issued April 2024
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of awards granted \| $	$ 20,000
Restricted Stock Units (RSUs) \| Awards Issued 27 January 2022
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of awards granted \| $							$ 716,625
Vesting period							3 years
Restricted Stock Units (RSUs) \| Awards Issued 27 January 2022 \| Share-Based Payment Arrangement, Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Percentage of award							33.33%
Restricted Stock Units (RSUs) \| Awards Issued 27 January 2022 \| Share-Based Payment Arrangement, Tranche Two Through Twenty-Five
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Percentage of award							2.78%

Stock-based compensation - Options - Activity (Details) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Number of Options
Number of options, beginning of period (in shares)	355,999
Granted (in shares)	697,629
Forfeited (in shares)	0
Exercised (in shares)	0
Expired (in shares)	0
Number of options, end of period (in shares)	1,053,628	355,999
Number of options, vested and exercisable (in shares)	285,079
Weighted Average Exercise Price
Weighted average exercise price, beginning of period (in dollars per share)	$ 2.56
Granted (in dollars per share)	1.46
Weighted average exercise price, end of period (in dollars per share)	1.83	$ 2.56
Weighted Average Grant Date Fair Value
Weighted average grant date fair value, beginning of period (in dollars per share)	1.20
Weighted average grant date fair value, granted (in dollars per share)	0.82
Weighted average grant date fair value, end of period (in dollars per share)	$ 0.95	$ 1.20
Weighted Average Remaining Contractual Term
Weighted average remaining contractual term, outstanding	8 years 10 months 2 days	9 years 4 months 6 days
Weighted average remaining contractual term, granted	10 years
Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Vested and Expected to Vest [Abstract]
Weighted average exercise price, vested and exercisable (in dollars per share)	$ 2.57
Weighted average grant date fair value - vested and exercisable (in dollars per share)	$ 1.21
Weighted average remaining contractual term, vested and exercisable	7 years 6 months 14 days
Average Intrinsic Value
Aggregate Intrinsic Value, Beginning balance	$ 0
Aggregate Intrinsic Value, Granted	0
Aggregate Intrinsic Value, Ending balance	0	$ 0
Aggregate Intrinsic Value, Vested and exercisable	$ 0

Stock-based compensation - Options - Fair Value (Details) - USD ($)	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Employee Stock Option
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Fair value of options awarded	$ 573,163	$ 201,000

Stock-based compensation - Options - Fair Value Assumptions (Details) - Employee Stock Option - $ / shares	1 Months Ended
	Apr. 30, 2024	Mar. 31, 2024	Mar. 31, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Risk-free interest rate (%)	4.54%	4.21%	3.65%
Expected volatility range (%)	55.32%	55.11%	63.36%
Fair market value per ordinary share as at grant dates (in dollars per share)	$ 1.32	$ 1.50	$ 2.08

Stock-based compensation - Share-based Compensation Expense (Details) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended
	Jan. 26, 2022	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total share-based compensation expenses	$ 0	$ 208,506	$ 59,337	$ 536,597	$ 331,893
Selling and distribution expenses
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total share-based compensation expenses				116,584	93,746
General and administrative expenses
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total share-based compensation expenses				$ 420,013	$ 238,147

Stock-based compensation - Unrecognized Share-based Compensation Expense (Details)	9 Months Ended
	Sep. 30, 2024 USD ($)
Share-Based Payment Arrangement [Abstract]
Unrecognized employee share-based compensation expense	$ 1,280,193
Unrecognized employee share-based compensation expense related to unvested awards, weighted-average period for recognition	2 years 1 month 20 days

Income taxes - Pre-tax Income (Loss) (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Income components
United States	$ (1,614,080)	$ (239,835)	$ (3,455,011)	$ (641,733)
Outside United States	1,183,369	755,843	2,186,900	1,166,922
(Loss) income before income taxes	$ (430,711)	$ 516,008	$ (1,268,111)	$ 525,189

Income taxes - Components of Income Tax Expense (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Current
Federal	$ (12,757)	$ (6,062)	$ (12,219)	$ 4,562
State	29,128	7,210	37,553	10,343
Foreign	502,214	223,979	831,959	524,776
Current, Total	518,585	225,127	857,293	539,681
Deferred
Federal	(154,816)	(42,497)	(572,163)	(135,172)
State	(96,232)	(10,114)	(149,646)	(3,930)
Foreign	0	0	(144,073)	(3,988)
Deferred, Total	(251,048)	(52,611)	(865,882)	(143,090)
Total provision for (benefit of) income taxes	$ 267,537	$ 172,516	$ (8,589)	$ 396,591

Income taxes - Effective Income Tax Rate Reconciliation (Details)	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Effective Income Tax Rate Reconciliation, Percent [Abstract]
Federal statutory rate (as a percent)	21.00%	21.00%
State and local income taxes, net of federal benefit (as a percent)	6.10%	(1.70%)
Foreign operations (as a percent)	(16.20%)	21.50%
Permanent items (as a percent)	(10.80%)	0.70%
Deferred adjustments (as a percent)	(0.10%)	2.10%
Others (as a percent)	0.70%	0.10%
Effective tax rate (as a percent)	0.70%	43.70%

Income taxes - Deferred Tax Assets and Liabilities (Details) - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Deferred tax assets
Allowance for credit losses	$ 31,996	$ 58,476
Other reserve	108,814	61,371
Accrued expenses	146,771	143,823
Lease liability	1,541,398	1,769,328
Charitable contributions	8,306	8,181
Business interest limitation	519,320	242,862
Net operating loss – federal	602,265	310,099
Net operating loss – state	102,852	27,337
Other	195,389	66,063
Total deferred tax assets	3,257,111	2,687,540
Less: valuation allowance	0	0
Net deferred tax assets	3,257,111	2,687,540
Deferred tax liabilities
Fixed assets	1,471,219	1,728,364
Intangibles	(233,765)	(209,657)
Total deferred tax liabilities	1,237,454	1,518,707
Deferred tax assets, net of deferred tax liabilities	$ 2,019,657	$ 1,168,833

Income taxes - Operating Loss Carryforwards (Details) - USD ($)	9 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	$ 4,520,993	$ 1,836,077
Unrecognized tax benefits	0	0
Domestic Tax Jurisdiction
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	2,867,922	1,476,655
State and Local Jurisdiction
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	$ 1,653,071	$ 359,422
Net operating loss carryforwards, subject to expiration, period	20 years

Related party transactions and balances - Sales to a related party (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Related Party Transaction [Line Items]
Revenue	$ 36,099,179	$ 29,932,612	$ 96,223,647	$ 86,284,791
Related Party
Related Party Transaction [Line Items]
Revenue	408,977	0	408,977	0
Foremost Worldwide Co., Ltd. \| Related Party
Related Party Transaction [Line Items]
Revenue	$ 408,977	$ 0	$ 408,977	$ 0

Related party transactions and balances - Purchases of a related party (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Related Party Transaction [Line Items]
Purchases from a related parties	$ 3,802,863	$ 2,686,497	$ 10,535,795	$ 8,694,616
Focal Capital Holding Limited
Related Party Transaction [Line Items]
Purchases from a related parties	1,903,797	980,910	4,658,602	5,950,640
Foremost Worldwide Co., Ltd.
Related Party Transaction [Line Items]
Purchases from a related parties	1,883,192	717,188	5,837,250	1,755,577
Rizhao Foremost Woodwork Manufacturing Co., Ltd.
Related Party Transaction [Line Items]
Purchases from a related parties	15,874	0	39,943	0
F.P.Z. Furniture (Cambodia) Co., Ltd.
Related Party Transaction [Line Items]
Purchases from a related parties	0	575,060	0	575,060
Foremost Australasia Pty Ltd
Related Party Transaction [Line Items]
Purchases from a related parties	$ 0	$ 413,339	$ 0	$ 413,339

Related party transactions and balances - Prepayments - related parties (Details) - Related Party - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Related Party Transaction [Line Items]
Prepayments - related parties	$ 12,067,506	$ 6,667,679
Focal Capital Holding Limited
Related Party Transaction [Line Items]
Prepayments - related parties	12,043,142	6,658,498
Rizhao Foremost Woodwork Manufacturing Co., Ltd.
Related Party Transaction [Line Items]
Prepayments - related parties	$ 24,364	$ 9,181

Related party transactions and balances - Accounts Payables (Details) - Related Party - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Related Party Transaction [Line Items]
Accounts payable	$ 5,053	$ 735,308
Foremost Worldwide Co., Ltd.
Related Party Transaction [Line Items]
Accounts payable	$ 5,053	$ 735,308

Related party transactions and balances - Shared Service and Miscellaneous Expenses - General Information (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Shared Services Agreement and Miscellaneous Expenses, Provide Services \| Foremost Australasia Pty Ltd
Related Party Transaction [Line Items]
Related party transaction, amounts of transaction	$ 189,081	$ 178,249	$ 552,043	$ 655,230
Shared Services Agreement and Miscellaneous Expenses, Receive Services \| Foremost Worldwide Co., Ltd.
Related Party Transaction [Line Items]
Related party transaction, amounts of transaction	$ 82,908	$ 72,408	$ 217,504	$ 217,650

Related party transactions and balances - Shared Service and Miscellaneous Expenses - Tabular Disclosure (Details) - Related Party - USD ($)	Sep. 30, 2024	Dec. 31, 2023
Related Party Transaction [Line Items]
Other receivables	$ 1,902,457	$ 932,604
Foremost Australasia Pty Ltd
Related Party Transaction [Line Items]
Other receivables	2,215,919	1,183,612
Foremost Worldwide Co., Ltd.
Related Party Transaction [Line Items]
Other liabilities	(45,026)	(251,008)
Focal Capital Holding Limited
Related Party Transaction [Line Items]
Other liabilities	(11,306)	0
F.P.Z. Furniture (Cambodia) Co., Ltd.
Related Party Transaction [Line Items]
Other liabilities	$ (257,130)	$ 0

Related party transactions and balances - Loan Guarantee by Related Party (Details)	Sep. 30, 2024
Mr. Liang Chou Chen \| Foremost Groups Ltd.
Related Party Transaction [Line Items]
Ownership percentage (as a percent)	49.89%

Concentrations of risks - Credit Risk (Details)	Sep. 30, 2024 USD ($)	Sep. 30, 2024 CAD ($)	Sep. 30, 2024 EUR (€)	Sep. 30, 2024 AUD ($)	Sep. 30, 2024 INR (₨)	Dec. 31, 2023 USD ($)
Concentration Risk [Line Items]
Cash	$ 3,044,662					$ 7,777,241
Cash, amount uninsured by canadian deposit insurance corporation	77,197	$ 105,760
Cash, amount uninsured by taiwan central deposit insurance corporation	1,221,203
Cash, amount uninsured by european banking authority	297,931		€ 266,827
Cash, amount uninsured by Kingdom of Cambodia banking authority	142,166
Cash, amount uninsured by australian banking authority	29,676			$ 42,986
Cash, amount uninsured by indian banking authority	12,739				₨ 1,066,366
United States
Concentration Risk [Line Items]
Cash	372,731
Cash, amount uninsured by FDIC	93,835
Canada
Concentration Risk [Line Items]
Cash	150,190	$ 205,760
TAIWAN
Concentration Risk [Line Items]
Cash	1,535,430
European Union
Concentration Risk [Line Items]
Cash	409,588		€ 366,827
CAMBODIA
Concentration Risk [Line Items]
Cash	142,166
AUSTRALIA
Concentration Risk [Line Items]
Cash	202,269			$ 292,986
INDIA
Concentration Risk [Line Items]
Cash	$ 18,712				₨ 1,566,366

Concentrations of risks - Customer Concentration Risk (Details) - Customer Concentration Risk	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Revenue from Contract with Customer Benchmark \| Largest Customer
Concentration Risk [Line Items]
Concentration risk (as a percent)	19.50%	14.50%	17.50%	17.40%
Revenue from Contract with Customer Benchmark \| Customer, Second Largest
Concentration Risk [Line Items]
Concentration risk (as a percent)	15.10%	14.30%	16.80%	16.60%
Revenue from Contract with Customer Benchmark \| Customer, Third Largest
Concentration Risk [Line Items]
Concentration risk (as a percent)		13.90%
Accounts Receivable \| Largest Customer
Concentration Risk [Line Items]
Concentration risk (as a percent)			27.60%		27.20%
Accounts Receivable \| Customer, Second Largest
Concentration Risk [Line Items]
Concentration risk (as a percent)			15.00%		19.00%
Accounts Receivable \| Customer, Third Largest
Concentration Risk [Line Items]
Concentration risk (as a percent)			10.80%		12.00%
Accounts Receivable \| Customer, Fourth Largest
Concentration Risk [Line Items]
Concentration risk (as a percent)					11.10%

Concentrations of risks - Vendor Concentration Risk (Details) - Supplier Concentration Risk	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Cost of Goods and Service Benchmark \| Tangshan Huida Ceramic Group Co., Ltd
Concentration Risk [Line Items]
Concentration risk (as a percent)	57.30%	55.80%	55.60%	54.50%
Cost of Goods and Service Benchmark \| Supplier, Second Largest
Concentration Risk [Line Items]
Concentration risk (as a percent)				10.10%
Accounts Payable \| Tangshan Huida Ceramic Group Co., Ltd
Concentration Risk [Line Items]
Concentration risk (as a percent)			72.00%		71.40%

Segment Information (Details) - segment	3 Months Ended		9 Months Ended
Segment Information (Details) - segment	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract]
Number of reportable segment	1	1	1	1

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