BEIJING, Aug. 16, 2024 (GLOBE NEWSWIRE) -- TIAN RUIXIANG Holdings Ltd (Nasdaq: TIRX) (the "Company"), a China-based insurance broker conducting business through its variable interest entity in China, today announced its financial results for the half year ended April 30, 2024.
Ms. Sheng Xu, the Chief Executive Officer of the Company, commented, "The Company reported a net loss of approximately $2.6 million for the six months ended April 30, 2024, primarily due to a significant decline in revenue caused by the loss of a few key insurance company partners. However, we are encouraged by the increase in the commissions from liability insurance of approximately $24,000 compared to the same period in 2023, indicating our success in expanding our liability insurance business.”
“We are actively pursuing strategies, such as expanding into the Hong Kong insurance brokerage market and diversifying our client base, to mitigate the impact of the lost partnerships and improve the Company’s financial performance in the future.”
Selected Half Year 2024 Financial Metrics
Six Months Ended April 30,
Changes in
($ in millions, except per share data, differences due to rounding.)
2024
2023
Percentage
Revenues
$
0.2
$
0.7
(75.4)
%
Total operating expenses
3.1
2.7
18.4
%
Loss from operations
(3.0)
(1.9)
53.7
%
Net loss
(2.6)
(1.5)
75.3
%
Revenue
Revenue for the six months ended April 30, 2024 totaled $0.2 million, a decrease of $0.5 million, or 75.4%, compared with $0.7 million for the six months ended April 30, 2023. This significant decrease was primarily attributable to the loss of certain insurance company partners.
Operating Expenses
During the six months ended April 30, 2024 and 2023, operating expenses included selling and marketing expenses and general and administrative expenses.
Selling and marketing expenses amounted to $1.2 million for the six months ended April 30, 2024, as compared to $1.6 million for the six months ended April 30, 2023, a decrease of $0.4 million, or 26.5%. The decrease was mainly attributable to a decrease in advertising costs and other miscellaneous items.
General and administrative expenses amounted to $2.0 million for the six months ended April 30, 2024, as compared to $1.1 million for the six months ended April 30, 2023, an increase of $0.9 million, or 83.0%.
Loss from Operations
As a result of the foregoing, for the six months ended April 30, 2024, loss from operations amounted to $3.0 million, as compared to $1.9 million for the six months ended April 30, 2023.
Net Loss
As a result of the factors described above, net loss was $2.6 million for the six months ended April 30, 2024, as compared to $1.5 million for the six months ended April 30, 2023, a change of $1.1 million, or 75.3%.
About TIAN RUIXIANG Holdings Ltd
TIAN RUIXIANG Holdings Ltd, headquartered in Beijing, China, is an insurance broker operating in China through its China-based variable interest entity. It distributes a wide range of insurance products, which are categorized into two major groups: (1) property and casualty insurance, such as commercial property insurance, liability insurance, accidental insurance, and automobile insurance; and (2) other types of insurance, such as health insurance, life insurance, and other miscellaneous insurance. For more information, visit the company's website at http://ir.tianrx.com/.
Forward-Looking Statements
Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review risk factors that may affect its future results in the Company's registration statement and in its other filings with the U.S. Securities and Exchange Commission.
For investor and media enquiries, please contact:
TIAN RUIXIANG Holdings Ltd Investor Relations Department Email: ir@tianrx.com
TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (IN U.S. DOLLARS)
As of
April 30, 2024
October 31, 2023
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash
$
27,456,502
$
2,383
Restricted cash
700,530
692,692
Short-term investments
—
26,797,081
Accounts receivable
7,844
18,960
Other current assets
90,333
107,508
Total Current Assets
28,255,209
27,618,624
NON-CURRENT ASSETS:
Right-of-use assets, operating leases, net
61,518
54,870
Note receivable
7,800,000
7,800,000
Interest receivable
78,000
—
Property and equipment, net
5,605
6,280
Intangible assets, net
1,766,961
—
Total Non-current Assets
9,712,084
7,861,150
Total Assets
$
37,967,293
$
35,479,774
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Acquisition payable
$
1,875,002
$
—
Operating lease liabilities
24,892
57,402
Taxes payable
626,150
623,825
Salary payable
815,449
726,330
Accrued liabilities and other payables
932,295
481,801
Due to related parties
1,310,545
1,173,510
Total Current Liabilities
5,584,333
3,062,868
NON-CURRENT LIABILITIES:
Operating lease liabilities - noncurrent portion
39,872
—
Total Non-current Liabilities
39,872
—
Total Liabilities
5,624,205
3,062,868
EQUITY:
TIAN RUIXIANG Holdings Ltd Shareholders' Equity:
Ordinary shares: $0.025 par value; 40,000,000 shares authorized;
Class A ordinary shares: $0.025 par value; 36,000,000 shares authorized; 1,372,949 and 674,949 shares issued and outstanding at April 30, 2024 and October 31, 2023, respectively
34,324
16,874
Class B ordinary shares: $0.025 par value; 4,000,000 shares authorized; 50,000 shares issued and outstanding at April 30, 2024 and October 31, 2023
1,250
1,250
Additional paid-in capital
46,361,339
44,108,774
Accumulated deficit
(10,909,039
)
(8,303,691
)
Statutory reserve
275,150
275,150
Accumulated other comprehensive loss
(3,420,333
)
(3,681,845
)
Total TIAN RUIXIANG Holdings Ltd shareholders' equity
32,342,691
32,416,512
Non-controlling interest
397
394
Total Equity
32,343,088
32,416,906
Total Liabilities and Equity
$
37,967,293
$
35,479,774
TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES UNAUDITED CONDESNSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (IN U.S. DOLLARS)
(IN U.S. DOLLARS)
For the Six Months Ended April 30,
2024
2023
REVENUES
$
178,345
$
724,859
OPERATING EXPENSES
Selling and marketing
1,149,083
1,564,353
General and administrative - professional fees
390,503
735,314
General and administrative - compensation and related benefits
1,521,846
290,810
General and administrative - other
79,743
62,368
Total Operating Expenses
3,141,175
2,652,845
LOSS FROM OPERATIONS
(2,962,830
)
(1,927,986
)
OTHER INCOME (EXPENSE)
Interest income
348,639
468,200
Other income (expense)
22,940
(6,464
)
Total Other Income, net
371,579
461,736
LOSS BEFORE INCOME TAXES
(2,591,251
)
(1,466,250
)
INCOME TAXES
14,098
20,003
NET LOSS
$
(2,605,349
)
$
(1,486,253
)
LESS: NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST
(1
)
—
NET LOSS ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD ORDINARY SHAREHOLDERS
$
(2,605,348
)
$
(1,486,253
)
NET LOSS PER ORDINARY SHARE ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD ORDINARY SHAREHOLDERS:
Basic and diluted
$
(2.68
)
$
(2.50
)
WEIGHTED AVERAGE ORDINARY SHARES OUTSTANDING:
Basic and diluted
970,721
594,901
COMPREHENSIVE LOSS:
NET LOSS
$
(2,605,349
)
$
(1,486,253
)
OTHER COMPREHENSIVE INCOME
Unrealized foreign currency translation gain
261,516
1,485,978
COMPREHENSIVE LOSS
(2,343,833
)
(275
)
LESS: COMPREHENSIVE INCOME ATTRIBUTABLE TO NON-CONTROLLING INTEREST
3
23
COMPREHENSIVE LOSS ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD ORDINARY SHAREHOLDERS
$
(2,343,836
)
$
(298
)
TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (IN U.S. DOLLARS)
For the Six Months Ended April 30,
2024
2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss
$
(2,605,349
)
$
(1,486,253
)
Adjustments to reconcile net loss to
net cash provided by operating activities:
Depreciation expense and amortization of intangible assets
30,896
1,017
Amortization of right-of-use assets
36,835
55,334
Stock-based compensation and service expense
2,270,015
1,068,000
Bad debt provision
18,073
25
Loss on disposal of property and equipment
—
735
Changes in operating assets and liabilities:
Accounts receivable
11,423
(60,321
)
Security deposit
—
4,402
Interest receivable
(78,000
)
262,192
Due from related party
—
1,444
Other assets
397
55,340
Taxes payable
(4,086
)
24,428
Salary payable
91,969
204,189
Accrued liabilities and other payables
518,567
(8,959
)
Due to related parties
3,611
683,003
Operating lease liabilities
(36,141
)
(42,993
)
NET CASH PROVIDED BY OPERATING ACTIVITIES
258,210
761,583
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from note receivable
—
7,500,000
Cash acquired on acquisition
77,893
—
Proceeds from sale of short-term investments
27,336,938
27,615,075
NET CASH PROVIDED BY INVESTING ACTIVITIES
27,414,831
35,115,075
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from related parties' borrowings
93,794
—
Repayments of related parties' borrowings
(35,807
)
—
NET CASH PROVIDED BY FINANCING ACTIVITIES
57,987
—
EFFECT OF EXCHANGE RATE ON CASH AND RESTRICTED CASH
(269,071
)
84,307
NET INCREASE IN CASH AND RESTRICTED CASH
27,461,957
35,960,965
CASH AND RESTRICTED CASH - beginning of period
695,075
695,242
CASH AND RESTRICTED CASH - end of period
$
28,157,032
$
36,656,207
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for:
Interest
$
—
$
—
Income taxes
$
1,423
$
—
NON-CASH INVESTING AND FINANCING ACTIVITIES
Reissuance of treasury stock
$
—
$
25,000
Payments made by related parties on the Company's behalf
$
75,333
$
—
Accrued purchase price related to acquisition
$
1,875,002
$
—
RECONCILIATION OF CASH AND RESTRICTED CASH
Cash at beginning of period
$
2,383
$
2,508
Restricted cash at beginning of period
692,692
692,734
Total cash and restricted cash at beginning of period
