HONG KONG, Dec. 27, 2024 /PRNewswire/ — CCSC Technology International Holdings Limited (the “Company” or “CCSC”) (Nasdaq: CCTG), a Hong Kong-based company that engages in the sale, design and manufacturing of interconnect products, including connectors, cables and wire harnesses, today announced its unaudited financial results for the first six months of fiscal year 2025 ended September 30, 2024.
Mr. Kung Lok Chiu, Chief Executive Officer and Director of the Company, commented, “The first six months of fiscal year 2025 has been a remarkable period of growth for our Company. We are proud to report a 22.9% increase in revenue compared to the same period last year, while our gross margin remained stable despite a net loss of $0.74 million in a challenging environment. Furthermore, in January 2024, we successfully completed our initial public offering (IPO) and got listed on the Nasdaq Capital Market under the ticker symbol “CCTG”. Building on the momentum, we launched a plan in May 2024 to establish a new supply chain management center in Serbia, Central Europe. Once completed, this center will serve as the headquarter of our supply chain operations in Europe to support our operations across the region. As of the date of the report, we have acquired the land plot for our new center and expect to complete this project by the fourth quarter of 2025. Looking forward, we plan to strategically focus on further expanding into high-growth industries, such as new energy, robotics, and medical technologies. By continuing to invest in research and development, we aim to deliver innovative and cost-effective products that meet the evolving needs of our customers. We are committed to delivering high-quality products to our customers and generating long-term value for our shareholders.”
First Six Months of Fiscal Year 2025 Financial Highlights
Revenue increased by 22.9% to $9.2 million for the six months ended September 30, 2024, from $7.5 million for the same period of last year.
Gross profit increased by 20.5% to $2.7 million for the six months ended September 30, 2024, from $2.3 million for the same period of last year.
Gross profit margin was 29.8% for the six months ended September 30, 2024, compared to 30.4% for the same period of last year.
Net loss was $0.7 million for the six months ended September 30, 2024, compared to net income of $0.4 million for the same period of last year.
First Six Months of Fiscal Year 2025 Financial Results
Revenue
Total revenue was $9.2 million for the six months ended September 30, 2024, which increased by 22.9% from $7.5 million for the same period of last year.
The following table sets forth revenue by interconnect products:
For the six months ended September 30,
Change
2024
%
2023
%
Amount
%
(Amounts expressed in U.S. dollars)
Cable and wire harness
$
8,604,502
93.3 %
$
6,887,303
91.8 %
$
1,717,199
24.9 %
Connectors
613,957
6.7 %
616,217
8.2 %
(2,260)
(0.4) %
Total
$
9,218,459
100.0 %
$
7,503,520
100.0 %
$
1,714,939
22.9 %
Revenue generated from cables and wire harnesses increased by 24.9%, to $8.6 million for the six months ended September 30, 2024, from $6.9 million for the same period of last year. Revenue generated from connectors remained essentially unchanged compared to the same period last year.
The increase in revenue was primarily attributable to the increase in sales volume and partially offset by the decrease in the average selling price of products. The increase in demand was mainly due to that customers had utilized their inventories previously purchased and increased their orders accordingly.
The following table sets forth the disaggregation of revenue by regions:
For the six months ended September 30,
Change
2024
%
2023
%
Amount
%
(Amounts expressed in U.S. dollars)
Europe
$
5,626,272
61.0 %
$
4,336,284
57.8 %
$
1,289,988
29.7 %
Asia
2,736,289
29.7 %
2,388,511
31.8 %
347,778
14.6 %
Americas
855,847
9.3 %
778,725
10.4 %
77,122
9.9 %
Other regions
51
0.0 %
–
0.0 %
51
0.0 %
Total
$
9,218,459
100 %
$
7,503,520
100 %
$
1,714,939
22.9 %
Revenue generated from Europe increased by 29.7%, to $5.6 million for the six months ended September 30, 2024, from $4.3 million for the same period of last year. The increase was primarily due to the increase of sales in Denmark of $1.0 million and Bulgaria of $0.2 million.
Revenue generated from Asia increased by 14.6%, to $2.7 million for the six months ended September 30, 2024, from $2.4 million for the same period of last year. The increase was primarily due to sales increases in Hong Kong, China of $0.1 million, and sales increases in the Association of Southeast Asian Nations, or ASEAN, of $0.2 million.
Revenue generated from the Americas increased by 9.9%, to $0.9 million for the six months ended September 30, 2024, from $0.8 million for the same period of last year. The increase was primarily due to sales increases in Northern America of $0.08 million.
Revenue from other regions was mainly derived from Australia.
Cost of Revenue
Cost of revenue increased by 23.9%, to $6.5 million for the six months ended September 30, 2024, from $5.2 million for the same period of last year, which was in line with the increase of the total revenue.
Inventory costs amounted to $4.4 million for the six months ended September 30, 2024, compared to $3.5 million for the same period of last year. The increase of inventory costs was primarily due to a 47.5% increase in the total sales volume and a 13.6% decrease in the inventory cost per unit.
Labor costs amounted to $1.5 million for the six months ended September 30, 2024, compared to $1.2 million for the same period of last year. The increase of labor costs was primarily due to the increase in production volume as a result of an increase in sales volume.
Gross Profit and Gross Margin
Gross profit increased by 20.5%, to $2.7 million for the six months ended September 30, 2024, from $2.3 million for the same period of last year.
Gross profit margin was 29.8% for the six months ended September 30, 2024, compared with 30.4% for the same period of last year. The gross profit margin was basically consistent with the same period of 2023. The Company recruited more workers to cope with the increased sales volume, and the increased labor costs eroded profits, resulting in a decrease in gross profit margin.
Operating Expenses
Operating expenses increased by 38.5%, to $3.6 million for the six months ended September 30, 2024, from $2.6 million for the same period of last year. The expense increase was mainly due to the increases in the selling expenses of $0.3 million, inclusive of $0.2 million in costs relating to market development and expansion to ASEAN market, and general and administrative expenses of $0.7 million, inclusive of $0.6 million in agent and professional fees for expenses related to compliance requirements as a public company following the IPO in the U.S..
Other Income/(Expenses)
Other income/(expenses) decreased by $0.8 million, to other expenses of $0.1 million for the six months ended September 30, 2024, from other income of $0.6 million for the same period of last year, primarily due to the decrease in foreign exchange gain.
Income tax benefit
Income tax benefit increased by 170.7%, to $0.2 million for the six months ended September 30, 2024, from $0.1 million for the same period of last year, which was due to the loss of CCSC Technology Group for the six months ended September 30, 2024.
Net (Loss)/Income
Net income decreased by 280.0%, to net loss of $0.7 million for the six months ended September 30, 2024, from net income of $0.4 million for the same period of last year.
Basic and Diluted (Loss)/Earnings per Share
Basic and diluted loss per share was $0.06 for the six months ended September 30, 2024, compared to basic and diluted earnings per share of $0.04 for the same period of last year.
About CCSC Technology International Holdings Limited
CCSC Technology International Holdings Limited, is a Hong Kong-based company that engages in the sale, design and manufacturing of interconnect products. The Company specializes in customized interconnect products, including connectors, cables and wire harnesses that are used for a range of applications in a diversified set of industries, including industrial, automotive, robotics, medical equipment, computer, network and telecommunication, and consumer products. The Company produces both OEM (“original equipment manufacturer”) and ODM (“original design manufacture”) interconnect products for manufacturing companies that produce end products, as well as electronic manufacturing services (“EMS”) companies that procure and assemble products on behalf of such manufacturing companies. The Company has a diversified global customer base located in more than 25 countries throughout Asia, Europe and the Americas. For more information, please visit the Company’s website: http://ir.ccsc-interconnect.com.
Forward-Looking Statements
Certain statements in this announcement are forward-looking statements, including, but not limited to, the Company’s proposed Offering. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company’s current expectations and projections about future events that may affect its financial condition, results of operations, business strategy and financial needs. Investors can find many (but not all) of these statements by the use of words such as “may,” “will,” “could,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “is/are likely to,” “propose,” “potential,” “continue”, or other similar expressions in this press release. The Company undertakes no obligation to update or revise publicly any 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 other factors that may affect its future results in the Company’s registration statement and other filings with the U.S. Securities and Exchange Commission.
For more information, please contact:
CCSC Technology International Holdings Limited
Investor Relations Department
Email: ir@ccsc-interconnect.com
Ascent Investor Relations LLC
Tina Xiao
Phone: +1-646-932-7242
Email: investors@ascent-ir.com
CCSC TECHNOLOGY INTERNATIONAL HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Amount in U.S. dollars, except for number of shares)
As of September 30,
2024
As of March 31,
2024
(Unaudited)
Assets
Current assets:
Cash
$
3,789,806
$
5,525,430
Restricted cash
209,622
209,317
Accounts receivable
3,256,687
2,750,214
Inventories
1,967,824
2,023,456
Prepaid expenses and other current assets
1,737,454
1,474,405
Total current assets
10,961,393
11,982,822
Non-current assets:
Property, plant and equipment, net
681,342
198,901
Intangible asset, net
103,768
38,183
Operating right-of-use assets, net
1,441,593
1,659,297
Finance lease right-of-use asset
15,915
17,788
Deferred tax assets, net
488,190
287,394
Other non-current assets
3,733,073
3,753,646
Total non-current assets
6,463,881
5,955,209
TOTAL ASSETS
$
17,425,274
$
17,938,031
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable
$
2,567,890
$
2,175,974
Advance from customers
151,594
207,293
Accrued expenses and other current liabilities
1,333,630
1,523,843
Taxes payable
27,248
24,974
Operating lease liabilities – current
517,985
506,061
Finance lease liabilities – current
4,682
4,454
Total current liabilities
4,603,029
4,442,599
Non-current liabilities:
Operating lease liabilities – non current
961,965
1,184,056
Finance lease liabilities – non current
11,739
13,709
Total non – current liabilities
973,704
1,197,765
TOTAL LIABILITIES
$
5,576,733
$
5,640,364
Commitments and Contingencies
—
—
Shareholders’ equity
Class A ordinary shares, par value of US$0.0005 per share; 495,000,000 shares authorized,
6,581,250 shares issued and outstanding as of September 30, 2024 and March 31, 2024*
3,291
3,291
Class B ordinary shares, par value of US$0.0005 per share; 5,000,000 shares authorized,
5,000,000 shares issued and outstanding as of September 30, 2024 and March 31, 2024*
2,500
2,500
Additional paid-in capital
4,855,795
4,855,795
Statutory reserve
813,235
813,235
Retained earnings
7,747,463
8,491,783
Accumulated other comprehensive loss
(1,573,743)
(1,868,937)
Total shareholders’ equity
11,848,541
12,297,667
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
$
17,425,274
$
17,938,031
*Retrospectively reflect the changes in class of shares effective on September 10, 2024
CCSC TECHNOLOGY INTERNATIONAL HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
AND COMPREHENSIVE LOSS
(Amount in U.S. dollars, except for number of shares)
For the six months ended September 30,
2024
2023
Net revenue
$
9,218,459
$
7,503,520
Cost of revenue
(6,470,715)
(5,223,159)
Gross profit
2,747,744
2,280,361
Operating expenses:
Selling expenses
(752,926)
(473,636)
General and administrative expenses
(2,468,416)
(1,753,179)
Research and development expenses
(332,155)
(338,038)
Total operating expenses
(3,553,497)
(2,564,853)
Loss from operations
(805,753)
(284,492)
Other (expenses)/income:
Other non-operating (expenses)/income, net
(34,766)
51,628
Government subsidies
138,845
–
Foreign currency exchange (losses)/gains
(241,996)
539,844
Financial and interest expenses, net
7,530
35,783
Total other (expenses)/income
(130,387)
627,255
(Loss)/income before income tax expense
(936,140)
342,763
Income tax benefit
191,820
70,851
Net (loss)/income
(744,320)
413,614
Other comprehensive income/(loss)
Foreign currency translation adjustment
295,194
(636,978)
Total comprehensive loss
$
(449,126)
$
(223,364)
(Loss)/earnings per share
Basic and Diluted
$
(0.06)
$
0.04
Weighted average number of ordinary shares
Basic and Diluted
11,581,250
10,000,000
CCSC TECHNOLOGY INTERNATIONAL HOLDINGS LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amount in U.S. dollars, except for number of shares)
For the six months ended
September 30,
2024
2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss)/income
$
(744,320)
$
413,614
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Inventories write-down
108,257
73,643
Depreciation and amortization
108,167
114,208
Amortization of right-of-use asset
259,582
251,865
Loss from disposal of fixed assets
1,497
595
Deferred tax benefits
(191,820)
(79,198)
Foreign currency exchange losses/(gains)
189,653
(539,844)
Changes in operating assets and liabilities:
Accounts receivable
(479,077)
(47,683)
Inventories
(10,449)
164,072
Prepaid expenses and other current assets
(221,742)
(223,354)
Other non-current assets
54,925
–
Accounts payable
336,256
418,473
Advance from customers
(56,965)
(60,075)
Taxes payable
1,453
(4,408)
Accrued expenses and other current liabilities
(223,442)
(39,341)
Operating lease liabilities
(250,801)
(244,763)
Financing lease liabilities
(2,208)
–
Net cash (used in)/provided by operating activities
(1,121,034)
197,804
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment
(44,006)
(52,025)
Purchase of land
(539,513)
–
Purchase of intangible asset
(83,346)
(19,217)
Net cash used in investing activities
(666,865)
(71,242)
CASH FLOWS FORM FINANCING ACTIVITIES
Repayments of long-term bank loans
–
(39,817)
Payment for deferred initial public offering costs
–
(366,094)
Capital contribution by shareholder
–
5,000
Net cash used in financing activities
–
(400,911)
Effect of exchange rate changes on cash and restricted cash
52,580
(63,670)
Net change in cash and restricted cash
(1,735,319)
(338,019)
Cash and restricted cash, beginning of the year
5,734,747
7,717,615
Cash and restricted cash, end of the year
$
3,999,428
$
7,379,596
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for income tax
$
–
$
(39,402)
Cash paid for interest
$
–
$
(228)
Cash paid for operating lease
$
(287,263)
$
(288,667)
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SOURCE CCSC Technology International Holdings Limited
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