Gross Profit
Increased 13.2% Year-Over-Year to
$7.7 Million
Gross Margins increased to 19.5%, up
from 16.0% in Fiscal Q1 2024
Expanded Global Reach through 5-Year
Master Distributor Agreement with ANDS for MENA and Global
Duty-Free Markets
LOS
ANGELES, Nov. 11, 2024
/PRNewswire/
-- Ispire Technology Inc.
(NASDAQ:
ISPR) ("Ispire," the "Company," "we," "us,"
or "our"), an innovator in vaping technology and precision dosing,
today reported results for the fiscal first quarter 2025, which
ended on September 30, 2024, and
anticipates filing its annual report on Form 10-Q with the U.S.
Securities and Exchange Commission (the "SEC") on November 12, 2024.
Fiscal First Quarter 2025 Financial
Results
- Revenue was $39.3
million as compared to $42.9 million in the fiscal
first quarter of 2024.
- Gross
profit increased 13.2% to $7.7
million compared to $6.8
million in the fiscal first quarter of 2024.
- Gross margin increased to 19.5%
as compared to 16.0% in the fiscal first quarter of
2024
- Total operating
expenses increased 67.0% to $12.9
million as compared to $7.7 million in the fiscal
first quarter of 2024.
- Net loss of ($5.6)
million as compared to net loss of ($1.3) million in
the fiscal first quarter of 2024.
Michael
Wang, Co-Chief Executive Officer of Ispire,
commented, "Our results from the fiscal
first quarter of 2025 reflect our commitment to our growth strategy
of becoming the leading innovative vaping technology
and precision dosing solutions company worldwide. While our
financial results were slightly impacted due to the strategic
shifts we have made in our US business to focus on high quality
customers and to improve payment terms and gross profit, I am
pleased with our team's overall performance given the challenging
macroeconomic environment and look forward to the remainder of
fiscal 2025 and the opportunities that lay ahead."
Mr. Wang continued,
"Additionally, we have continued to make progress with
the point-of-use age-gating technology and have begun the initial
phase of commercialization worldwide. Also, our recently
launched 'I-80' is set to revolutionize the cannabis industry given
its production efficiency and cost effectiveness and we continue to
see increased adoption of our machine from leading players in the
industry. Lastly, we are excited to have recently expanded our
global reach through a landmark 5-year master distributor agreement
with ANDS for the Middle East and
North Affrica region and Global Duty-Free markets. This partnership
will enable us to bring our Hidden Hills Club nicotine portfolio to
new markets, offering adult consumers innovative, harm-reduced
alternatives to combustible cigarettes. We believe that the recent
advancements we have made, combined with our solid financial
performance, positions Ispire for continued growth and success as
we proceed with our mission of providing industry-leading vaping
technology worldwide."
Jim
McCormick, Chief Financial Officer of Ispire, stated, "The
results from our fiscal first quarter were in line with our
internal projections as we shifted our U.S. strategy while we also
had a few delayed shipments which impacted our quarterly results.
Despite the obstacles we've faced, our first quarter financial
performance was still strong, including our gross profit increasing
13.2% year-over-year and our gross margins improving from 16.0% in
the fiscal first quarter of 2024 to 19.5% in the fiscal first
quarter of 2025. As we head into the remainder of fiscal 2025, we
are confident that we are well-positioned to continue delivering
value to our shareholders as we advance our mission of becoming a
global leading provider of innovative vaping technology and
precision dosing solutions."
Financial Results for the Fiscal First Quarter Ended
September 30, 2024
For the fiscal first quarter ended
September 30, 2024, Ispire reported
revenue of $39.3 million compared to
$42.9 million during the same period
last year, a decrease of 8.2%. The
decrease in revenue is the combined effect
of decreases in product sales in
the United States of
$8.1 million from
$17.8 million for the fiscal
first quarter ended September
30, 2023, to $9.7 million for
the three months ended
September 30, 2024, offset
by increases in sales of vaping products in
Europe of $2.1
million from $19.9 million for
the three months ended
September 30, 2023 to approximately
$22.0 million for the fiscal
first quarter ended September
30, 2024, and increases in sales to other
regions of $3.7 million
from $0.06
million for the three
months ended September 30,
2023 to approximately $3.8 million for
the fiscal first quarter ended
September 30, 2024, mainly contributed by
increase in sales to South Africa
of $2.9 million.
Gross profit for the fiscal first quarter
ended September 30, 2024, was
$7.7 million compared to $6.8 million for the fiscal first quarter 2024
ended September 30, 2023. Over this
same period, our gross margin grew to 19.5%, from 16.0%. The
increase in gross profit and gross margin was primarily due to
changes in product mix with an increase in higher margin products
being sold during the fiscal first quarter ended September 30, 2024.
Total operating expenses for the fiscal
first quarter ended September 30,
2024 were $12.9 million as
compared to $7.7 million for fiscal
first quarter ended September 30,
2023. The increase in operating expenses is due to an
increase in our marketing activities, marketing campaign and trade
shows of $0.7 million, stock-based
compensation expense related to selling personnel of $1.0 million for the three months ended
September 30, 2024 and headcount and
payroll expense for Aspire Science of $0.1
million. The Company also had an increase in stock-based
compensation expense of $1.0 million
for the three months ended September 30,
2024, as compensation and incentive for management,
employees and service providers, and an increase in bad debt
expense as an allowance for credit losses of $1.9 million from accounts resulted from
management's assessment on Company's account receivables
balances.
For the fiscal first quarter ended
September 30, 2024, net loss was
($5.6) million or ($0.10) per share, compared to a net loss of
($1.3) million, or ($0.02) per share for fiscal first quarter
ended September 30,
2023.
As of September 30,
2024, Ispire had $37.7
million in cash and cash equivalents and working capital of
$16.6 million.
Conference Call
The Company will conduct a conference call
at 8:00 am Eastern Time on Monday, November 11, 2024, to discuss the
results. Ispire management will host the conference call, followed
by a question-and-answer period.
Please call the conference call dial-in
5-10 minutes prior to the start time and ask for the "Ispire
Technology Call." An operator will register your name and
organization.
- Date: Monday, November 11,
2024
- Time: 8:00 am ET
- Dial-In Numbers: United States
844-826-3033 or International +1 412-317-5185
This conference call will be broadcast live on the
Internet and can be accessed by all interested parties
at
https://viavid.webcasts.com/starthere.jsp?ei=1693594&tp_key=0c7f927f41
Please access the link at least fifteen
minutes prior to the start of the call to register, download, and
install any necessary audio software.
A playback will be available from
11:00 am ET on November 11, 2024 through November 25, 2024. To listen, please dial
1-844-512-2921 or 1-412-317-6671. Use the passcode
10193803 to access the replay.
About Ispire Technology Inc.
Ispire is
engaged in the research and development, design, commercialization,
sales, marketing, and distribution of branded e-cigarettes and
cannabis vaping products. The Company's operating subsidiaries own
or license more than 200 patents received or filed globally.
Ispire's tobacco products are marketed under the Aspire brand name
and are sold worldwide (except in the U.S., People's Republic of China and Russia) primarily through its global
distribution network. The Company's cannabis products are marketed
under the Ispire brand name primarily on an original design
manufacturer (ODM) basis to other cannabis vapor companies. Ispire
sells its cannabis vaping hardware only in the U.S., and it
recently commenced its marketing activities in Canada and Europe. For more information, visit
www.ispiretechnology.com or follow Ispire
on Instagram,
LinkedIn,
Facebook, Twitter
and YouTube. Any information
contained on, or that can be accessed through, the Company's
website, any other website or any social media, is not a part of
this press release.
Forward Looking Statements
This
press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended
("Securities Act") as well as Section 21E of the Securities
Exchange Act of 1934, as amended, and the Private Securities
Litigation Reform Act of 1995, as amended, that are intended to be
covered by the safe harbor created by those sections.
Forward-looking statements, which are based on certain assumptions
and describe the Company's future plans, strategies and
expectations, can generally be identified by the use of
forward-looking terms such as "believe," "expect," "may," "will,"
"should," "would," "could," "seek," "intend," "plan," "goal,"
"project," "estimate," "anticipate," "strategy," "future," "likely"
or other comparable terms, although not all forward-looking
statements contain these identifying words. All statements other
than statements of historical facts included in this press release
regarding the Company's strategies, prospects, financial condition,
operations, costs, plans and objectives are forward-looking
statements. Important factors that could cause the Company's actual
results and financial condition to differ materially from those
indicated in the forward-looking statements. Such forward-looking
statements include, but are not limited to, risks and uncertainties
including those regarding: whether the Company may be successful in
re-entering the U.S. ENDS market; the approval or rejection of any
PMTA submitted by the Company; whether the Company's joint venture
with Touch Point Worldwide Inc. d/b/a/ Berify and Chemular Inc.
(the "Joint Venture") may be successful in achieving its goals as
currently contemplated, with different terms, or at all, the Joint
Venture's ability to innovate in the e-cigarette technology space
or develop age gating or age verification technologies for nicotine
vaping devices, the Company's ability to collect its accounts
receivable in a timely manner, the Company's business strategies,
the ability of the Company to market to the Ispire ONE™, Ispire
ONE™'s success if meeting its goals, the ability of its customers
to derive the anticipated benefits of the Ispire ONE™ and the
success of its products on the markets, the Ispire ONE™ proving to
be safe, and the risk and uncertainties described in "Risk
Factors," "Management's Discussion and Analysis of Financial
Condition and Results of Operations," "Cautionary Note on
Forward-Looking Statements" and the additional risk described in
Ispire's Annual Report on Form 10-K for the year ended September 30, 2023 and any subsequent filings
which Ispire makes with the SEC. You should not rely upon
forward-looking statements as predictions of future events. The
forward-looking statements made in this press release relate only
to events or information as of the date on which the statements are
made in this press release. We undertake no obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, after the date on which
the statements are made or to reflect the occurrence of
unanticipated events except as required by applicable law. You
should read this press release with the understanding that our
actual future results may be materially different from what we
expect.
|
ISPIRE TECHNOLOGY
INC.
|
|
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(In $USD, except
share and per share data)
|
|
|
|
September 30,
2024
|
|
|
June 30,
2024
|
|
|
Assets
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash
|
|
$
|
37,731,954
|
|
|
$
|
35,071,294
|
|
|
Restricted
cash
|
|
|
24,280
|
|
|
|
-
|
|
|
Accounts receivable,
net
|
|
|
62,359,322
|
|
|
|
59,734,765
|
|
|
Inventories,
net
|
|
|
6,992,025
|
|
|
|
6,365,394
|
|
|
Prepaid expenses and
other current assets
|
|
|
1,406,822
|
|
|
|
1,400,152
|
|
|
Total current
assets
|
|
|
108,514,403
|
|
|
|
102,571,605
|
|
|
Other
assets:
|
|
|
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
|
2,662,714
|
|
|
|
2,582,457
|
|
|
Intangible assets,
net
|
|
|
2,015,805
|
|
|
|
1,375,666
|
|
|
Right-of-use assets –
operating leases
|
|
|
3,295,952
|
|
|
|
3,579,140
|
|
|
Other
investment
|
|
|
2,000,000
|
|
|
|
2,000,000
|
|
|
Equity method
investment
|
|
|
10,172,075
|
|
|
|
10,248,048
|
|
|
Other non-current
assets
|
|
|
291,699
|
|
|
|
284,050
|
|
|
Total other
assets
|
|
|
20,438,245
|
|
|
|
20,069,361
|
|
|
Total
assets
|
|
$
|
128,952,648
|
|
|
$
|
122,640,966
|
|
|
Liabilities and stockholders'
equity
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
4,341,642
|
|
|
$
|
3,779,723
|
|
|
Accounts payable –
related party
|
|
|
76,001,622
|
|
|
|
67,046,472
|
|
|
Contract
liabilities
|
|
|
2,245,505
|
|
|
|
2,218,166
|
|
|
Accrued liabilities
and other payables
|
|
|
12,139,232
|
|
|
|
11,738,339
|
|
|
Income tax
payable
|
|
|
399,995
|
|
|
|
-
|
|
|
Operating lease
liabilities – current portion
|
|
|
1,240,726
|
|
|
|
1,207,832
|
|
|
Total current
liabilities
|
|
|
96,368,722
|
|
|
|
85,990,532
|
|
|
|
|
|
|
|
|
|
|
|
Other
liabilities:
|
|
|
|
|
|
|
|
|
|
Operating lease
liabilities – net of current portion
|
|
|
1,869,951
|
|
|
|
2,194,094
|
|
|
Total
liabilities
|
|
|
98,238,673
|
|
|
|
88,184,626
|
|
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
|
|
|
Common stock, par value
$0.0001 per share; 140,000,000 shares authorized;
56,641,041 and 56,470,636 shares issued and outstanding as of
September 30,
2024 and June 30, 2024
|
|
|
5,664
|
|
|
|
5,647
|
|
|
Preferred stock, par
value $0.0001 per share, 10,000,000 shares authorized, no
shares issued at September 30, 2024 and June 30,
2024
|
|
|
-
|
|
|
|
-
|
|
|
Additional paid-in
capital
|
|
|
45,224,962
|
|
|
|
43,217,391
|
|
|
Accumulated
deficit
|
|
|
(14,420,057)
|
|
|
|
(8,825,041)
|
|
|
Accumulated other
comprehensive (loss) income
|
|
|
(96,594)
|
|
|
|
58,343
|
|
|
Total stockholders'
equity
|
|
|
30,713,975
|
|
|
|
34,456,340
|
|
|
Total liabilities and
stockholders' equity
|
|
$
|
128,952,648
|
|
|
$
|
122,640,966
|
|
|
ISPIRE TECHNOLOGY
INC.
|
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS
|
|
(In $USD, except
share and per share data)
|
|
|
|
Three Months Ended
September 30,
|
|
|
|
2024
|
|
|
2023
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
39,338,313
|
|
|
$
|
42,864,647
|
|
|
Cost of
revenue
|
|
|
31,663,935
|
|
|
|
36,019,799
|
|
|
Gross
profit
|
|
|
7,674,378
|
|
|
|
6,844,848
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Sales and marketing
expenses
|
|
|
2,992,247
|
|
|
|
1,025,219
|
|
|
General and
administrative expenses
|
|
|
9,904,539
|
|
|
|
6,697,874
|
|
|
Total operating
expenses
|
|
|
12,896,786
|
|
|
|
7,723,093
|
|
|
Loss from
operations
|
|
|
(5,222,408)
|
|
|
|
(878,245)
|
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
86
|
|
|
|
72,246
|
|
|
Exchange gain,
net
|
|
|
117,585
|
|
|
|
3,661
|
|
|
Other income
(expenses), net
|
|
|
6,935
|
|
|
|
(43,204)
|
|
|
Total other income,
net
|
|
|
124,606
|
|
|
|
32,703
|
|
|
Loss before income
taxes
|
|
|
(5,097,802)
|
|
|
|
(845,542)
|
|
|
Income taxes -
current
|
|
|
(497,214)
|
|
|
|
(496,045)
|
|
|
Net loss
|
|
$
|
(5,595,016)
|
|
|
$
|
(1,341,587)
|
|
|
Other comprehensive
(loss) income
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
|
|
(154,937)
|
|
|
|
44,463
|
|
|
Comprehensive
loss
|
|
|
(5,749,953)
|
|
|
|
(1,297,124)
|
|
|
Net loss per
share
|
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
$
|
(0.10)
|
|
|
$
|
(0.02)
|
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
|
|
56,601,320
|
|
|
|
54,246,212
|
|
|
ISPIRE
TECHNOLOGY INC.
|
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(In $USD, except
share and per share data)
|
|
|
|
Three Months ended
September 30,
|
|
|
|
2024
|
|
|
2023
|
|
|
Net loss:
|
|
$
|
(5,595,016)
|
|
|
$
|
(1,341,587)
|
|
|
Adjustments to
reconcile net income from operations to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
204,807
|
|
|
|
29,161
|
|
|
Credit loss
expenses
|
|
|
3,102,081
|
|
|
|
225,487
|
|
|
Right-of-use assets
amortization
|
|
|
283,188
|
|
|
|
287,481
|
|
|
Stock-based
compensation expenses
|
|
|
2,007,588
|
|
|
|
967,560
|
|
|
Inventory
impairment
|
|
|
73,692
|
|
|
|
-
|
|
|
Loss from equity
method investment
|
|
|
75,973
|
|
|
|
-
|
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
|
|
(5,726,638)
|
|
|
|
(14,710,476)
|
|
|
Inventories
|
|
|
(700,323)
|
|
|
|
1,863,080
|
|
|
Other current and
non-current assets
|
|
|
(14,319)
|
|
|
|
1,603,180
|
|
|
Accounts
payable
|
|
|
9,517,069
|
|
|
|
(2,449,276)
|
|
|
Contract
liabilities
|
|
|
(87,402)
|
|
|
|
281,529
|
|
|
Accrued liabilities
and other payables
|
|
|
360,697
|
|
|
|
(124,950)
|
|
|
Income tax
payable
|
|
|
399,995
|
|
|
|
496,138
|
|
|
Lease
liabilities
|
|
|
(291,249)
|
|
|
|
(249,753)
|
|
|
Net cash provided by
(used in) operating activities
|
|
$
|
3,610,143
|
|
|
$
|
(13,122,426)
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
|
Purchase of property, plant
and equipment
|
|
|
(268,781)
|
|
|
|
(533,122)
|
|
|
Acquisition of
intangible assets
|
|
|
(656,422)
|
|
|
|
(255,650)
|
|
|
Net cash used in
investing activities
|
|
$
|
(925,203)
|
|
|
$
|
(788,772)
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
|
Repayments of
advances from a related party
|
|
|
-
|
|
|
|
(703,323)
|
|
|
Net cash used in
financing activities
|
|
$
|
-
|
|
|
$
|
(703,323)
|
|
|
|
|
|
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
|
2,684,940
|
|
|
|
(14,614,521)
|
|
|
Cash and cash
equivalents - beginning of period
|
|
|
35,071,294
|
|
|
|
40,300,573
|
|
|
Cash and cash
equivalents - end of period
|
|
$
|
37,756,234
|
|
|
$
|
25,686,052
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental non-cash investing and financing
activities
|
|
|
|
|
|
|
|
|
|
Leased assets
obtained in exchange for operating lease liabilities
|
|
|
-
|
|
|
|
537,307
|
|
For more information, kindly contact:
IR Contacts:
Investor Relations
Sherry Zheng
718-213-7386
ir@ispiretechnology.com
KCSA Strategic Communications
Phil Carlson
212-896-1233
ispire@kcsa.com
PR Contact:
Ellen
Mellody
570-209-2947
EMellody@kcsa.com
View original
content:https://www.prnewswire.com/news-releases/ispire-technology-inc-reports-financial-results-for-fiscal-first-quarter-2025-302300568.html
SOURCE Ispire Technology Inc.