Decent Holding Inc. Reports Full Year 2024 Financial Results
YANTAI, China, March 10, 2025 (GLOBE NEWSWIRE) -- Decent Holding Inc. (Nasdaq: DXST) (“Decent“ or the ”Company“), an established wastewater treatment services provider in China, today announced its financial results for the fiscal year ended October 31, 2024.
Full Year 2024 Financial Highlights
Total revenue for the full year of 2024 increased by 22.2% to US$11.5 million, from US$9.4 million in the prior year.
Gross profit for the full year of 2024 remained stable at $3.2 million, even though the gross profit margin declined to 27.8% from 34.0% in the prior year.
Net income for the full year of 2024 increased to $2.1 million, compared with $1.9 million in the prior year.
Operating expenses for the full year of 2024 decreased by 29.0% to $0.7 million from $1.0 million in the prior year, benefiting from improved operational efficiency.
Mr. Dingxin Sun, Chairman of the Company commented: “In fiscal year 2024, we achieved a significant 22.2% increase in total revenue, which reflects our resilience and adaptability in navigating a dynamic economic environment. This growth was driven by successful strategies across our business segments, particularly in wastewater treatment and river water quality management.”
“Despite this positive revenue trajectory, our gross profit margin approximately to about 27.8% in fiscal year 2024. This decline was largely due to a higher proportion of revenue derived from lower-margin projects. Nevertheless, we maintained a stable gross profit of $3.2 million, underscoring our commitment to profitability even in challenging conditions. We are particularly encouraged by the 121.2% increase in other related revenues, which maintained a 100% gross profit margin. This demonstrates our ability to identify and capitalize on new opportunities without incurring additional costs.”
Mr. Sun added: “Our focus on operational efficiency was reflected in the approximately 29% reduction in total operating expenses, which has been instrumental in sustaining our profitability. As a result, net income rose to $2.1 million, compared with $1.9 million in the prior year.”
“Looking ahead, we remain committed to enhancing our service offerings and optimizing our revenue mix to improve margins. We plan to invest in innovative technologies and expand our market presence, particularly in high-growth areas such as sustainable water management solutions. By fostering strategic partnerships and leveraging our expertise, we aim to drive long-term growth and create additional value for our stakeholders.”
Selected Financial Results
Total revenue
Total revenue increased by 22.2%, or $2.1 million, to $11.5 million for the fiscal year ended October 31, 2024, compared with $9.4 million for the fiscal year ended October 31, 2023, demonstrating the Company’s resilience and adaptability to maintain profitability in a fluctuating economic environment. Specifically:
Revenue from Wastewater Treatment Service for the fiscal year ended October 31, 2024 rose to $2.5 million from $2.4 million for the fiscal year ended October 31, 2023, reflecting a 4.8% increase driven by new customer acquisitions. Cost of revenue for wastewater treatment service was $1.8 million in fiscal year 2024, a 0.2% increase from 2023. This resulted in an increase in gross profit margins of 15.7% to 25.2 % for fiscal year 2024 from 21.8% for fiscal year 2023.
Revenue from River Water Quality Management for the fiscal year ended October 31, 2024 rose significantly to $6.9 million, a 54.7% increase from $4.4 million in fiscal year 2023, driven by successful bids and project completions. However, most projects involved civil works like dredging and stormwater networks, which typically yield lower margins. Consequently, the gross profit margin declined to 26.1% in fiscal year 2024 from 28.6% in fiscal year 2023.
Revenue from Product Sales for the fiscal year ended October 31, 2024, declined by 17.2% to approximately $2.2 million, down from $2.6 million in fiscal year 2023. This decrease was mainly due to reduced procurement from local enterprises, particularly in microbial inoculum used for river water quality management. Cost of revenue for this segment increased by 15.07% to about $1.4 million in fiscal year 2024, due to upgrades in pharmaceutical formulations. As a result, gross profit fell by 18.0% to approximately $0.78 million, compared with $1.4 million in fiscal year 2023, leading to a gross profit margin of 35.8%, compared with 53.8% in the prior year.
Other Related Revenues increased by 121.2% to $16,700 for the fiscal year ended October 31, 2024, compared with $7,549 in fiscal year 2023, maintaining a 100% gross profit margin with no associated costs.
Cost of Revenue
Total cost of revenue for the fiscal years ended October 31, 2024, and 2023, was $8.3 million and $6.2 million, respectively. The increase was driven by higher revenues and the reclassification of maintenance guarantee expenses for wastewater treatment and river water quality management projects from selling expenses to cost of revenue.
Gross Profit and Margin
Gross profit for the year ended October 31, 2024, was $3.2 million, remaining relatively stable compared with fiscal year 2023. Gross margin declined to 27.8% in fiscal year 2024 from 34.0% in fiscal year 2023, primarily due to a greater proportion of revenue coming from lower-margin wastewater treatment and river water quality management projects.
Operating Expenses
Total operating expenses decreased by 29.0% to $0.7 million for the fiscal year ended October 31, 2024, from $1.0 million in fiscal year 2023. The decrease is primarily attributed to a decrease in selling expenses due to reduced marketing costs from improved reputation, the reclassification of maintenance guarantee expenses to costs of revenue, and a decrease in both general and administrative expenses and research and development expenses.
Net income
As a result of the factors described above, net income for the fiscal years ended October 31, 2024 and 2023 was $2.1 million and $1.9 million, respectively.
About Decent Holding Inc.
Decent Holding Inc. specializes in the provision of wastewater treatment by cleansing the industrial wastewater, ecological river restoration and river ecosystem management by enhancing the water quality, as well as microbial products primarily used for pollutant removal and water quality enhancement, through the Company’s subsidiary, Shandong Dingxin Ecology Environmental Co., Ltd. For more information, please visit: https://ir.dxshengtai.com.
Forward-Looking Statement
This press release contains forward-looking statements. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as “may,” “will,” “intend,” “should,” “believe,” “expect,” “anticipate,” “project,” “estimate“ or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company's expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the uncertainties related to market conditions and all other factors discussed in the ”Risk Factors“ section of the Company’s latest Annual Report on Form 20-F filed with the SEC, available for review at www.sec.gov. For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.
For investor and media inquiries, please contact:
Wealth Financial Services LLC
Connie Kang, Partner
Email: ckang@wealthfsllc.com
Tel: +86 1381 185 7742 (CN)
DECENT HOLDING INC. AND SUBSIDIARIES | ||||||||
As of | As of | |||||||
ASSETS | ||||||||
CURRENT ASSETS | ||||||||
Cash | $ | 407,031 | $ | 1,325,458 | ||||
Accounts receivable, net | 8,702,303 | 2,178,923 | ||||||
Prepayment, net | 7,699 | 530,215 | ||||||
Other receivables | 11,410 | 22,741 | ||||||
Contract assets | 603,979 | 144,876 | ||||||
Due from related parties | 40,154 | 514 | ||||||
Inventories | 134 | 187 | ||||||
Total current assets | 9,772,710 | 4,202,914 | ||||||
NON-CURRENT ASSETS | ||||||||
Deferred IPO costs | 967,793 | 531,491 | ||||||
Other long-term assets | — | 15,888 | ||||||
Operating lease assets, net | 67,934 | 118,181 | ||||||
Finance lease assets, net | 43,520 | 56,853 | ||||||
Property and equipment, net | 242,185 | 266,987 | ||||||
Intangible assets, net | 6,088 | 6,264 | ||||||
Deferred tax asset | 136,799 | 142,957 | ||||||
Total non-current assets | 1,464,319 | 1,138,621 | ||||||
TOTAL ASSETS | $ | 11,237,029 | $ | 5,341,535 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
CURRENT LIABILITIES | ||||||||
Accounts payable | $ | 1,851,723 | $ | 87,591 | ||||
Due to related parties | 63,222 | 106,789 | ||||||
Payroll payable | 23,401 | 5,724 | ||||||
Tax payables | 821,010 | 434,631 | ||||||
Other payables | 3,353,963 | 1,749,615 | ||||||
Finance lease liabilities – current | 21,893 | 23,235 | ||||||
Operating lease liabilities – current | 6,382 | 52,094 | ||||||
Estimated warranty liabilities | 64,576 | 26,513 | ||||||
Total current liabilities | 6,206,170 | 2,486,192 | ||||||
NON-CURRENT LIABILITIES | ||||||||
Finance lease liabilities – non-current | — | 21,299 | ||||||
Operating lease liabilities – non-current | 13,550 | 19,390 | ||||||
Total non-current liabilities | 13,550 | 40,689 | ||||||
TOTAL LIABILITIES | 6,219,720 | 2,526,881 | ||||||
SHAREHOLDERS’ EQUITY | ||||||||
Ordinary shares, US$0.0001 par value, authorized 500,000,000 shares as of October 31, 2024 and 2023; 15,000,000 shares issued and outstanding as of October 31, 2024 and 2023, respectively | 1,500 | 1,500 | ||||||
Subscription receivable | (1,500 | ) | (1,500 | ) | ||||
Additional paid-in capital | 1,210,094 | 1,210,094 | ||||||
Statutory reserve | 402,621 | 188,144 | ||||||
Retained earnings | 3,551,019 | 1,662,139 | ||||||
Accumulated other comprehensive loss | (146,425 | ) | (245,723 | ) | ||||
Total shareholders’ equity | 5,017,309 | 2,814,654 | ||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 11,237,029 | $ | 5,341,535 | ||||
DECENT HOLDING INC. AND SUBSIDIARIES | ||||||||||||
For The Years Ended | ||||||||||||
2024 | 2023 | 2022 | ||||||||||
REVENUE | ||||||||||||
Wastewater treatment revenue | $ | 2,468,097 | $ | 2,355,126 | $ | 650,308 | ||||||
River water quality management revenue | 6,864,631 | 4,436,214 | 1,910,425 | |||||||||
Product sales revenue | 2,192,864 | 2,648,445 | 1,008,042 | |||||||||
Others | 16,700 | 7,549 | 24,927 | |||||||||
TOTAL REVENUE | 11,542,292 | 9,447,334 | 3,593,702 | |||||||||
COST OF REVENUE | ||||||||||||
Wastewater treatment revenue | 1,845,434 | 1,841,604 | 482,554 | |||||||||
River water quality management revenue | 5,075,552 | 3,165,712 | 1,227,365 | |||||||||
Product sales revenue | 1,408,894 | 1,224,396 | 229,894 | |||||||||
TOTAL COST OF REVENUE | 8,329,880 | 6,231,712 | 1,939,813 | |||||||||
GROSS PROFIT | 3,212,412 | 3,215,622 | 1,653,889 | |||||||||
OPERATING EXPENSES | ||||||||||||
Selling expenses | 16,489 | 70,128 | 32,517 | |||||||||
General and administrative expenses | 662,158 | 851,130 | 1,061,967 | |||||||||
Research and development expenses | 28,981 | 122,441 | 60,883 | |||||||||
Impairment loss | 33,841 | — | — | |||||||||
Total operating expenses, net | 741,469 | 1,043,699 | 1,155,367 | |||||||||
NET PROFIT FROM OPERATIONS | 2,470,943 | 2,171,923 | 498,522 | |||||||||
OTHER INCOME (EXPENSES) | ||||||||||||
Interest income | 12,343 | 5,420 | 1,341 | |||||||||
Interest expense | — | (6,017 | ) | (86,671 | ) | |||||||
Other income | 851 | 5,214 | 18,257 | |||||||||
Other expense | (13 | ) | — | — | ||||||||
Total other income (expenses), net | 13,181 | 4,617 | (67,073 | ) | ||||||||
NET INCOME BEFORE TAXES | 2,484,124 | 2,176,540 | 431,449 | |||||||||
Income tax expenses | (380,767 | ) | (316,927 | ) | (59,014 | ) | ||||||
NET INCOME | 2,103,357 | 1,859,613 | 372,435 | |||||||||
OTHER COMPREHENSIVE INCOME (LOSS) | ||||||||||||
Foreign currency translation adjustment | 99,298 | (67,065 | ) | (131,378 | ) | |||||||
COMPREHENSIVE INCOME | $ | 2,202,655 | $ | 1,792,548 | 241,057 | |||||||
Weighted average number of shares outstanding during the year – basic and diluted | 15,000,000 | 15,000,000 | 15,000,000 | |||||||||
Earnings per Ordinary Share – basic and diluted | $ | 0.14 | $ | 0.12 | 0.02 | |||||||
DECENT HOLDING INC. AND SUBSIDIARIES | ||||||||||||
For The Years Ended | ||||||||||||
2024 | 2023 | 2022 | ||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||||
Net income | $ | 2,103,357 | $ | 1,859,613 | $ | 372,435 | ||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||
Provision for credit losses and bad debts | (95,193 | ) | 132,561 | 400,411 | ||||||||
Provision for inventory obsolescence | 185 | 26,585 | — | |||||||||
Gain from the disposal of property and equipment | — | (5,214 | ) | (18,236 | ) | |||||||
Depreciation and amortization | 76,594 | 45,455 | 19,527 | |||||||||
Impairment of property and equipment | 33,841 | — | — | |||||||||
Amortization of finance lease assets | 14,781 | 15,098 | 1,271 | |||||||||
Non-cash operating lease expenses | 53,044 | 49,446 | 45,574 | |||||||||
Deferred income tax effect | 10,054 | (27,991 | ) | (53,400 | ) | |||||||
Estimated warranty expenses | 36,971 | 27,462 | — | |||||||||
Changes in operating assets and liabilities: | ||||||||||||
Accounts receivable | (6,318,575 | ) | (626,233 | ) | 130,082 | |||||||
Prepayment - third parties | 544,461 | 1,626,312 | (2,311,240 | ) | ||||||||
Prepayment - related party | — | — | 101,708 | |||||||||
Other receivables | 12,393 | (15,197 | ) | 13,402 | ||||||||
Contract assets | (450,769 | ) | (150,063 | ) | — | |||||||
Due from related party | 96 | 7,995 | (7,752 | ) | ||||||||
Inventories | (127 | ) | 1,775,773 | 479,331 | ||||||||
Deferred expenses | 16,178 | (16,457 | ) | — | ||||||||
Tax payables | 370,714 | 344,918 | 112,414 | |||||||||
Other payables | 1,540,827 | 1,015,988 | 401,304 | |||||||||
Accounts payable | 1,745,087 | 87,085 | (371,389 | ) | ||||||||
Contract liabilities | — | (4,591,413 | ) | 2,397,667 | ||||||||
Operating lease liabilities | (53,044 | ) | (52,396 | ) | (52,580 | ) | ||||||
Amount due to related parties | (20,643 | ) | 56,628 | (271,800 | ) | |||||||
Payroll payable | 17,446 | (1,709 | ) | 2,193 | ||||||||
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | (362,322 | ) | 1,584,246 | 1,390,922 | ||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||||||
Purchase of property and equipment | (78,133 | ) | (153,794 | ) | (241,211 | ) | ||||||
Proceed of disposal of property and equipment | — | — | 21,995 | |||||||||
Purchase of intangible assets | — | — | (7,559 | ) | ||||||||
Payment to acquire finance lease assets | — | — | (13,615 | ) | ||||||||
Loan made to related parties | (39,348 | ) | — | (1,472,562 | ) | |||||||
Repayment from related parties | — | 10,759 | 2,312,566 | |||||||||
CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES | (117,481 | ) | (143,035 | ) | 599,614 | |||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||
Deferred IPO costs | (417,487 | ) | (207,969 | ) | (365,786 | ) | ||||||
Proceeds of bank loans | — | — | 1,510,204 | |||||||||
Repayment of bank loans | — | (1,867,293 | ) | (1,637,652 | ) | |||||||
Principal payment for obligation under finance leases | (23,659 | ) | (24,067 | ) | (2,142 | ) | ||||||
Proceeds from related parties | — | 132,084 | 29,630 | |||||||||
Repayment to related parties | (25,468 | ) | (133,924 | ) | (78,609 | ) | ||||||
CASH USED IN FINANCING ACTIVITIES | (466,614 | ) | (2,101,169 | ) | (544,355 | ) | ||||||
EFFECT OF EXCHANGE RATE ON CASH | 27,990 | 20,058 | (228,683 | ) | ||||||||
NET CHANGE IN CASH | (918,427 | ) | (639,900 | ) | 1,217,498 | |||||||
CASH AT BEGINNING OF YEAR | 1,325,458 | 1,965,358 | 747,860 | |||||||||
CASH AT END OF YEAR | $ | 407,031 | $ | 1,325,458 | 1,965,358 | |||||||
SUPPLEMENTAL CASH FLOW INFORMATION | ||||||||||||
Cash paid during the year for: | ||||||||||||
Income taxes | $ | — | $ | — | — | |||||||
Interest | $ | — | $ | 6,017 | 86,671 | |||||||
NON-CASH TRANSACTIONS | ||||||||||||
Operating lease assets obtained in exchange for lease obligations | $ | — | $ | 32,742 | 152,632 | |||||||
Finance lease assets obtained in exchange for lease obligations | — | — | 77,098 | |||||||||