Maison Solutions Reports Full Year 2024 Financial Results

About this update from Maison Solutions Inc.

MONTEREY PARK, CA / ACCESSWIRE / August 13, 2024 / Maison Solutions Inc. ("Maison Solutions" or the "Company"), (NASDAQ:MSS) , a U.S. -based specialty grocery retailer offering traditional Asian and international food and merchandise, today announced financial results for full year ended April 30, 2024 . Management Commentary "Following the successful IPO last October, we have made significant strides in expanding our footprint and enhancing our operational capabilities," said John Xu , President, Chairman and Chief Executive Officer of Maison Solutions . "The accretive acquisition of Lee Lee this past April was a pivotal step in fueling our growth strategy, allowing us to extend the Maison brand beyond the California border and into the state of Arizona . The three acquired stores have seamlessly merged under the Maison umbrella and are expected to more than double our current top-line figures while maintaining their profitability. We believe this acquisition will serve as the cornerstone of our growth in the coming year, as we look forward to reaping the financial benefits while exploring synergistic opportunities between our HK Good Fortune stores in California and the Lee Lee stores." "We also remain committed to the organic growth of our HK Good Fortune stores, specifically the renovation and digital transformation initiatives starting with our El Monte store, which is scheduled to be completed by the end of 2024. We are very confident in the outlook of our business and importantly, maximizing shareholder value." Full Year 2024 and Recent Operational Highlights Held a post-acquisition webinar detailing the Lee Lee International Supermarkets ("Lee Lee") acquisition Acquired Lee Lee , a three-store supermarket chain operating in the greater Phoenix and Tucson, Arizona metro areas Launched a Store Renovation Program that integrated a new software program and included exterior and interior upgrades to the HK Good Fortune supermarket in El Monte, California Presented at the Emerging Growth Conference Completed a $10 million IPO on the Nasdaq Capital Market Full Fiscal Year 2024 Financial Results Total net revenues for fiscal year 2024 increased 4.8% to $58.0 million compared to $55.4 million last fiscal year. The increase was primarily driven by the inclusion of revenues from the newly acquired subsidiary, Lee Lee , of $4.6 million and increased sales of Maison Monterey Park supermarket by $4.4 million . Perishable goods revenues for fiscal year 2024 increased 0.2% to $31.4 million compared to $31.3 million last fiscal year. Non-perishable goods revenues for fiscal year 2024 increased 10.7% to $26.7 million compared to $24.1 million last fiscal year. Total cost of revenues for fiscal year 2024 was $46.4 million compared to $42.9 million last fiscal year. The increase was primarily due to a corresponding increase in revenue, an increase in write-off inventory from the Lee Lee acquisition, and increased occupancy costs of existing supermarkets and Lee Lee . Gross profit for fiscal year 2024 was $11.6 million , while gross margin was 20.0%. Gross profit for fiscal year 2023 was $12.5 million , while gross margin was 22.5%. The decrease was primarily due to an increase in write-off inventory from the Lee Lee acquisition, and increased occupancy costs of existing supermarkets and Lee Lee . Net loss for fiscal year 2024 was approximately $3.3 million , compared to net income of approximately $1.3 million last fiscal year. The net loss was primarily due to a decrease in gross profit and other income, and an increase in investment loss from equity method investment, operating expenses, and income tax expense. Fiscal Year 2025 Guidance The Company is reiterating the following guidance for fiscal year 2025: Revenues between $120 million and $125 million Net income positive About Maison Solutions Inc. Maison Solutions Inc. is a U.S. -based specialty grocery retailer offering traditional Asian food and merchandise, particularly to members of Asian-American communities. The Company is committed to providing Asian fresh produce, meat, seafood, and other daily necessities in a manner that caters to traditional Asian-American family values and cultural norms, while also accounting for the new and faster-paced lifestyle of younger generations and the diverse makeup of the communities in which the Company operates. Since its formation in 2019, the Company has acquired equity interests in four traditional Asian supermarkets in the Los Angeles, California area, operating under the brand name HK Good Fortune, and three supermarkets in the Phoenix and Tucson, Arizona metro areas, operating under the brand name Lee Lee International Supermarket . To learn more about Maison Solutions , please visit the Company's website at www.maisonsolutionsinc.com . Follow us on LinkedIn and X . Cautionary Note Concerning Forward-Looking Statements This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. We caution readers that forward-looking statements are predictions based on our current expectations about future events. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Our actual results, performance, or achievements could differ materially from those expressed or implied by the forward-looking statements as a result of a number of factors, including the risks discussed under the heading "Risk Factors" discussed under the caption "Item 1A. Risk Factors" in Part I of our most recent Annual Report on Form 10-K or any updates discussed under the caption "Item 1A. Risk Factors" in Part II of our Quarterly Reports on Form 10-Q and in our other filings with the SEC , copies of which are available on the SEC's website at www.sec.gov . Maison Solutions undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise that occur after the date of this release, except as required by law. Investor Relations and Media Contact: Gateway Group, Inc. +1-949-574-3860 [email protected] MAISON SOLUTIONS INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME Years Ended April 30 , 2024 2023 Revenue $ 58,043,161 $ 55,399,112 Cost of goods sold 46,422,064 42,947,952 Gross profit 11,621,097 12,451,160 Operating expenses: Selling expenses 10,155,828 8,479,578 General and administrative expenses 4,169,275 3,887,935 Total operating expenses 14,325,103 12,367,513 Income (loss) from operations (2,704,006 ) 83,647 Non-operating income (expenses): Interest income (expense), net (124,260 ) 42,606 Investment loss from equity method investment (538,542 ) Other income, net 420,341 1,849,534 Non-operating income (expenses), net (242,461 ) 1,892,140 Income (loss) before income tax (2,946,467 ) 1,975,787 Income tax provisions 440,562 336,486 Net income (loss) before noncontrolling interest (3,387,029 ) 1,639,301 Net income (loss) attributable to noncontrolling interest (46,823 ) 387,498 Net income (loss) attributable to Maison Solutions Inc. $ (3,340,206 ) $ 1,251,803 Net income (Loss) per share attributable to Maison Solutions, Inc. - basic and diluted $ (0.19 ) $ 0.08 Weighted average number of common stock outstanding - basic and diluted 17,913,869 16,000,000 MAISON SOLUTIONS INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS April 30 , 2024 April 30 , 2023 ASSETS Current assets: Cash and cash equivalents $ - $ 2,569,766 Accounts receivable 111,874 315,356 Accounts receivable - related parties 459,647 289,615 Inventories, net 6,802,255 2,978,986 Prepayments 3,263,711 1,547,243 Other receivables and other current assets 1,240,786 550,836 Other receivable - related parties 33,995 33,995 Total current assets 11,912,268 8,285,797 Non-current assets: Restricted cash 1,101 1,101 Property and equipment, net 2,334,963 671,463 Intangible assets, net 7,978,911 197,329 Security deposits 946,208 457,491 Investment under cost method 75,000 - Investment under cost method - related parties 203,440 203,440 Investment in equity securities 1,261,458 - Operating lease right-of-use assets, net 40,726,647 22,545,190 Goodwill 16,957,147 2,222,211 Total non-current assets 70,484,875 26,298,225 Total assets $ 82,397,143 $ 34,584,022 LIABILITIES AND STOCKHOLDERS' DEFICIT Current liabilities: Bank overdraft $ 97,445 $ - Accounts payable 5,394,423 3,105,592 Accounts payable - related parties 470,605 465,310 Accrued expenses and other payables 1,627,082 867,796 Other payables - related parties 491,586 241,585 Income tax payable 442,518 961,034 Contract liabilities 965,696 449,334 Operating lease liabilities, current 4,088,678 1,761,182 Loan payables, current 65,098 370,828 Notes payable, current 15,126,065 150,000 Total current liabilities 28,769,196 8,372,661 Non-current liabilities: Long-term loan payables 2,496,201 2,561,299 Security deposit from sub-tenants 125,114 105,637 Operating lease liabilities, non-current 39,015,252 22,711,760 Deferred tax liability, net 1,272,260 40,408 Total non-current liabilities 42,908,827 25,419,104 Total Liabilities 71,678,023 33,791,765 Commitment and contingencies (Note 17) Stockholders' Equity: Class A Common stock, $0.0001 par value, 97,000,000 shares authorized; 17,450,476 and 13,760,000 shares issued and outstanding as of April 30, 2024 and 2023, respectively 1,745 1,376 Class B Common stock, $0.0001 par value, 3,000,000 shares authorized; 2,240,000 shares issued and outstanding 224 224 Additional paid in capital 13,313,523 - Retained earnings (accumulated deficit) (2,817,495 ) 522,710 Total Maison Solutions, Inc. stockholders' equity 10,497,997 524,310 Noncontrolling interests 221,123 267,947 Total stockholders' equity 10,719,120 792,257 Total liabilities and stockholders' equity $ 82,397,143 $ 34,584,022 MAISON SOLUTIONS INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS Years Ended April 30 , 2024 2023 Cash flows from operating activities Net income (loss) before noncontrolling interest $ (3,387,029 ) $ 1,639,301 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization expense 461,868 371,696 Inventory impairment (5,961 ) (130,056 ) Bad debt expense (60,000 ) 225,766 Investment loss 538,542 - Change in deferred taxes (11,698 ) (3,125 ) Changes in operating assets and liabilities: Accounts receivable 203,481 (258,309 ) Accounts receivable - related parties (271,461 ) 243,881 Inventories 914,356 343,513 Prepayments (1,716,468 ) (819,592 ) Other receivables and other current assets (474,943 ) (504,758 ) Security deposits (488,717 ) 5,654 Accounts payable (59,633 ) (589,651 ) Accounts payable - related parties 106,725 (161,677 ) Accrued expenses and other payables 342,592 (503,338 ) Income tax payable (518,516 ) 334,622 Contract liabilities 503,326 68,037 Operating lease liabilities 400,913 203,940 Other long-term payables 19,477 18,287 Net cash provided by (used in) operating activities (3,503,146 ) 484,191 Cash flows from investing activities Payments of equipment purchase (382,132 ) (49,388 ) Payments for intangible assets purchase (2,950,000 ) - Investment into TMA Liquor Inc. (75,000 ) - Investment into HKGF Market of Arcadia, LLC (1,800,000 ) - Payment for acquisition of subsidiaries (7,000,000 ) (2,500,000 ) Loans repaid from third parties - 4,410,270 Net cash provided by (used in) investing activities (12,207,132 ) 1,860,882 Cash flows from financing activities Bank overdraft 97,445 (281,941 ) Repayments (to) borrowings from related parties 250,000 (101,965 ) Repayments of loan payables (370,825 ) (362,731 ) Repayment of notes payable (150,000 ) - Net proceeds from issuance of common stock 13,313,892 - Net cash provided by (used in) financing activities 13,140,512 (746,637 ) Net changes in cash and restricted cash (2,569,766 ) 1,598,436 Cash and restricted cash at the beginning of the year 2,570,867 972,431 Cash and restricted cash at the end of the year $ 1,101 $ 2,570,867 Supplemental disclosure of cash and restricted cash Cash $ - $ 2,569,766 Restricted cash 1,101 1,101 Total cash and restricted cash $ 1,101 $ 2,570,867 Supplemental disclosure of cash flow information Cash paid for interest $ 104,451 $ 70,795 Cash paid for income taxes $ 973,656 $ 8,481 Supplemental disclosure of non-cash investing and financing activities Increase of right-of-use assets and lease liabilities $ 10,196 $ 8,454,300 SOURCE: Maison Solutions, Inc View the original press release on accesswire.com

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