TDH Holdings, Inc. Reports First Half 2024 Financial Results

PR Newswire

BEIJING, Dec. 17, 2024

BEIJING, Dec. 17, 2024 /PRNewswire/ -- TDH Holdings, Inc. $(PETZ)$ ("TDH" or the "Company"), a PRC-based company that is an owner, operator and manager of commercial real estate properties, announced today its financial results for the six months ended June 30, 2024.

 
First Half 2024 Unaudited Financial Highlights: 
------------------------------------------------------------------ 
                         For the Six Months Ended June 30 
                    ------------------------------------------ 
($ millions, 
except per share 
data)                  2024            2023          % Change 
-----------------   ----------      -----------      --------- 
Revenues from 
 continuing 
 operations         $     0.10      $         -      13,399.98% 
Gross profit        $     0.04      $         -      16,235.34% 
Gross profit 
 (loss) margin           35.26%          -29.50%     64.76 pp * 
Loss from 
 operations         $   (1.08)      $    (0.66)         -63.39% 
Operating loss                                       85,471.31* 
 margin              -1,047.13%      -86,518.44%            pp 
Net income 
 attributable to 
 common 
 stockholders       $     1.32      $      0.06       1,941.12% 
Earnings per share 
 - basic and 
 diluted            $     0.13      $      0.01       1,941.12% 
 
 
  *  pp: percentage points 
 
   -- Revenues from continuing operations increased by 13,399.98% to $0.10 
      million for the first half of 2024. We discontinued our restaurant 
      business in the second quarter of 2024 and began to focus on growing our 
      commercial real estate business line. The main reason for discontinuing 
      our restaurant business was due to the recurring loss from our restaurant 
      business since 2023. We believe that discontinuing our restaurant 
      business will provide us with the opportunity to shift our focus and 
      resources toward expanding and improving our newly added commercial real 
      estate business. 
 
   -- Gross profit was $ 0.04 million for the first half of 2024, compared to 
      gross loss of $226 for the same period of the prior year. 
 
   -- Operating loss was $1.08 million for the first half of 2024, compared to 
      operating loss of $0.66 million for the same period of the prior year. 
      The increase in operating loss was primarily due to the disposal of the 
      Company's restaurant business line in the second quarter of 2024, as the 
      Company has begun to focus on its commercial real estate business and 
      efforts to control operating costs going forward. 
 
   -- Net income was $1.32 million, or earnings per share of $0.13, for the 
      first half of 2024, compared to net income of $0.06 million, or income 
      per share of $0.01, for the same period of the prior year. 

First Half 2024 Financial Results

Revenues from continuing operations

In June 2024, we discontinued our restaurant business and started to focus on owing, operating and managing commercial real estate properties going forward. Since the commercial real estate business is a newly added business line, revenue from our continuing business only amounted to $0.1 million for the six months ended June 30, 2024. because only two months of revenue was reported. We expect our revenue from the commercial real estate business will continue to grow in the near future.

Cost of revenues from continuing operations

In line with our newly added commercial real estate rental business, we reported cost of revenues from continuing operations of $0.07 million. As a percentage of revenues, cost of revenues was 64.74% for the first half of 2024, compared to 129.50% for the same period of the prior year.

Gross profit (loss) and gross profit (loss) margin from continuing operations

Gross profit from continuing operations was $0.04 million for the first half of 2024, compared to gross loss of $226 for the same period of the prior year. The increase in gross profit was due to increased sales volume of our commercial real estate business. Gross profit margin was 35.26% for the six months ended June 30, 2024, as compared to 29.50% for the six months ended June 30, 2023, which was due to higher gross profit margin for our commercial real estate business.

Operating expense from continuing operations

Operating expense consists of selling expense and general and administrative expense.

General and administrative expense increase by $0.09 million, or 14.53%, to $0.76 million for the first half of 2024 from $0.66 million for the same period of the prior year.

In connection with our commencement of the commercial real estate business, we recognized $0.36 million of goodwill as of the commencement date. However, as a result of our commercial real estate business losses in the first half 2024, goodwill of $0.36 million has been fully impaired for the six months ended June 30, 2024.

As a result, total operating expenses increased by $0.46 million, or 68.95%, to $1.12 million for the first half of 2024 from $0.66 million for the same period of the prior year.

Operating loss from continuing operations

Loss from operations was $1.08 million for the first half of 2024, compared to $0.66 million for the same period of the prior year. The increase in continuing operating loss was mainly due to increased general and administrative expense and the recognition of impairment losses on goodwill in the first half of 2024.

Other income, net

Total net other income increased by approximately $1.84 million or 205.88%, from $0.89 million in the six months ended June 30, 2023, to $2.74 million in the six months ended June 30, 2024, which is primarily attributable to an increase in investment income. We invested our available cash on hand in equity securities of certain publicly listed companies through various open market transactions. Our investments in marketable securities are accounted for pursuant to ASC 321 and reported at their readily determinable fair value as quoted by market exchanges in the consolidated balance sheets with change in fair value recognized in earnings. During the first half of 2024, the investments generated a total of $2.76 million net returns as compared to $0.92 million for the same period of 2023.

Loss from discontinued operations

We disposed of our restaurant business in June 2024 and started our new commercial real estate business line. For the six months ended June 30, 2024, total revenues from our restaurant business decreased by approximately $0.3 million, or 18.04%, to $1.27 million from $1.55 million as compared with the same period of the prior year. Our cost of revenues, decreased by approximately $0.2 million or 16.8%, to $0.89 million for the six months ended June 30, 2024, as compared to $1.07 million for the six months ended June 30, 2023. Although we disposed of our restaurant business in first half of 2024, our operating expenses and other overhead costs associated with our restaurant business were still high. As a result of the above, we reported loss from discontinued operations of our restaurant business of $444,750 and $220,958 for the six months ended June 30, 2024 and 2023, respectively.

Net income attributable to the Company and earnings per share

As a result of the above, net income attributable to the Company was $1.32 million, or earnings per share of $0.13, for the first half of 2024, compared to net income of $0.06 million, or earnings per share of $0.01, for the same period of the prior year.

Financial Conditions

As of June 30, 2024, based on the results of the continuing operations, the Company had cash and cash equivalents of $12.91 million, compared to $13.13 million at December 31, 2023. Accounts receivable and inventories were $0.02 million and $0 million, respectively, as of June 30, 2024, compared to $0 million and $0 million, respectively, at December 31, 2023. We also had short-term investments of approximately $12.49 million and $13.32 million as of June 30, 2024, and December 31, 2023, respectively, which are highly liquid and can be converted into cash and used in our operations if needed.

Net cash used in operating activities was $2.34 million for the first half of 2024, compared to net cash used in operating activities of $2.35 million for the same period of the prior year.

Net cash provided by investing activities was $1.38 million for the first half of 2024, compared to net cash used in investing activities of $2.15 million for the same period of the prior year.

There was no cash provided by or used in our financing activities during the six months ended June 30, 2024, and 2023, respectively.

Notice

Rounding amounts and percentages: Certain amounts and percentages included in this press release have been rounded for ease of presentation. Percentage figures included in this press release have not in all cases been calculated on the basis of such rounded figures, but on the basis of such amounts prior to rounding. For this reason, certain percentage amounts in this press release may vary from those obtained by performing the same calculations using the figures in the financial statements. In addition, certain other amounts that appear in this press release may not sum due to rounding.

About TDH Holdings, Inc.

Founded in April 2002, TDH Holdings, Inc. (the "Company") (NASDAQ: PETZ), a PRC-based company that is an owner, operator and manager of commercial real estate properties. More information about the Company can be found at www.tiandihui.com.

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