JRSH Jerash Holdings US Inc

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): February 8, 2024

 

Jerash Holdings (US), Inc.

(Exact name of registrant as specified in its charter)

 

Delaware		001-38474		81-4701719
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

277 Fairfield Road, Suite 338, Fairfield, NJ		07004
(Address of principal executive offices)		(Zip Code)

 

Registrant’s telephone number, including area code: (201) 285-7973

 

 

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common stock, par value $0.001 per share		JRSH		The NASDAQ Stock Market LLC

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b–2 of the Securities Exchange Act of 1934 (§ 240.12b–2 of this chapter).

 

Emerging growth company ☐

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

Item 2.02 Results of Operations and Financial Condition.

 

On February 8, 2024, Jerash Holdings (US), Inc. issued a press release to announce financial results for its fiscal year 2024 third quarter, ended December 31, 2023. The press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit Number		Exhibit
99.1		Press Release dated February 8, 2024
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	JERASH HOLDINGS (US), INC.
February 8, 2024	By:	/s/ Choi Lin Hung
		Choi Lin Hung
		Chairman of the Board of Directors, Chief Executive Officer, President, and Treasurer

 

 

2

 

Exhibit 99.1

 

 

 

Jerash Holdings Reports Fiscal 2024 Third Quarter Financial Results

 

FAIRFIELD, N.J., February 8, 2024 – Jerash Holdings (US), Inc. (“Jerash” or the “Company”) (NASDAQ: JRSH), which manufactures and exports custom, ready-made, sportswear and outerwear for leading global brands, today announced financial results for its fiscal year 2024 third quarter, ended December 31, 2023.

 

Impact of Middle East Situation 

 

The ongoing turmoil in the Middle East, including the attacks on ships in the Red Sea is causing supply chain disruptions throughout the region and affecting many companies, including Jerash. Shipments of raw materials to the Company have been delayed, which, in turn, had a transitory effect on operations and financial performance.

 

While the extent of the impact on the region remains uncertain, the Company’s operations in Jordan are fully active, and exports from Jordan at both the Aqaba and Haifa ports are open following a temporary shutdown at Haifa. Starting in December 2023, Jerash has been able to adopt an alternative route through the Port of Jebel Ali in United Arab Emirates for raw material import. The Company is in close communication with its customers and has put contingency plans in place that will enable it to fulfill customer orders.

 

Fiscal Year 2024 Third Quarter Results

 

“The ongoing tension in the region presented supply chain issues, causing delays, but not cancellations, and curtailing production during the quarter,” said Sam Choi, Jerash’s chairman and chief executive officer. “While revenue was significantly down compared with the prior year period, we achieved profitability for the quarter and continued to make good progress attracting a fresh pipeline of orders from new customers representing established global brands.

 

“We are excited about our growth opportunity in Europe, having recently attracted another European-based high-end apparel brand for which we have begun to produce several trial orders. In addition, Vans and Dickies, both VF Corporation brands, placed trial orders for both the U.S. and European markets. These are all positive indicators for the future.

 

“While our new customers and the eventual shipment of delayed orders bode well for Jerash’s longer term future performance, it would be imprudent at this time to provide formal guidance on what to expect for the current quarter because of the ongoing geopolitical uncertainty. The Ministry of Foreign Affairs of Jordan has reassured our team that the government is proactive in maintaining a safe and stable environment for businesses and providing protection export sea routes. We are grateful that day-to-day life in Jordan remains normal. Our hearts go out to the innocent victims on all sides of the crisis, and we pray for an expeditious resolution,” Choi added.

 

 

Revenue for the fiscal year 2024 third quarter was $27.5 million, compared with $43.0 million in the same quarter last year, principally reflecting the supply chain interruptions, with fewer shipments being delivered to some of the Company’s major customers in the U.S.

 

Gross profit for the fiscal year 2024 third quarter was $4.5 million, compared with $5.8 million in the same quarter last year. Gross margin improved 270 basis points to 16.2 percent in the fiscal year 2024 third quarter, from 13.5 percent in the same quarter last year. The increase was primarily due to improved product mix, with a larger proportion of shipments to the Company’s major U.S. customers that generate higher margins.

 

Operating expenses were reduced to $4.1 million in the fiscal year 2024 third quarter, from $4.5 million in the same quarter last year. Selling, general and administrative expenses also were lower, at $3.8 million in the fiscal year 2024 third quarter, compared with $4.5 million in the same quarter last year. Stock-based compensation expenses for the fiscal year 2024 third quarter were $243,000, compared with none in the same quarter last year.

 

Operating income totaled $376,000 in the fiscal year 2024 third quarter, versus $1.3 million in the same quarter last year.

 

Total other expenses were $105,000 in the fiscal year 2024 third quarter, compared with $111,000 in the same quarter last year.

 

Net income was $232,000 in the fiscal year 2024 third quarter, or $0.02 per diluted share, versus $891,000, or $0.07 per diluted share, in the same quarter last year.

 

Comprehensive income attributable to Jerash’s common stockholders totaled $320,000 in the fiscal year 2024 third quarter, compared with $929,000 in the same quarter last year.

 

Balance Sheet, Cash Flow and Dividends

 

Cash totaled $19.6 million, and net working capital was $40.5 million at December 31, 2023.

 

On February 5, 2024, Jerash approved a regular quarterly dividend of $0.05 per share on its common stock, payable on February 23, 2024 to stockholders of record as of February 16, 2024.

 

Nine-Month Fiscal Year 2024 Results

 

Revenue for the first nine months of fiscal year 2024 was $95.6 million, compared with $114.3 million in the same period last year.

 

Gross profit was $15.4 million for the first nine months of fiscal year 2024, compared with $19.3 million for the same period last year. Gross margin for the first nine months of fiscal year 2024 was 16.1 percent, compared with 16.9 percent in the same period last year.

 

 

Operating expenses for the first nine months of fiscal year 2024 were $13.0 million, slightly lower than the same period last year. Operating income was $2.4 million for the first nine months of fiscal year 2024, compared with $6.2 million for the same period last year.

 

Net income for the first nine months of fiscal year 2024 was $1.1 million, or $0.09 per diluted share, compared with $4.4 million, or $0.35 per diluted share, in the same period last year.

 

Comprehensive income attributable to Jerash’s common stockholders was $1.0 million in the first nine months of fiscal year 2024, compared with $4.1 million in the same period last year.

 

Conference Call

 

Jerash will host an investor conference call to discuss its fiscal year 2024 third quarter results today, February 8, 2024, at 9:00 a.m. Eastern Time. 

 

Phone:

888-506-0062 (domestic); 973-528-0011 (international)

Conference ID:

964050

 

A live and archived webcast will be available online in the investor relations section of Jerash’s website at www.jerashholdings.com. For those who are not able to listen to the live broadcast, the call will be archived for approximately one year on the website. 

 

About Jerash Holdings (US), Inc. 

 

Jerash manufactures and exports custom, ready-made, sportswear and outerwear for leading global brands and retailers, including VF Corporation (which owns brands such as The North Face, Timberland, and Vans), New Balance, G-III (which licenses brands such as Calvin Klein, Tommy Hilfiger, DKNY, and Guess), American Eagle, and Skechers. Jerash’s existing production facilities comprise six factory units and four warehouses, and Jerash currently employs approximately 5,000 people. Additional information is available at www.jerashholdings.com.

 

Forward-Looking Statements

 

This news release contains forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. When used in this document, the words “may”, “would”, “could”, “will”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “expect”, “seek”, “potential,” “outlook” and similar expressions are intended to identify forward-looking statements. Such statements, including, but not limited to, Jerash’s current views with respect to future events and its financial forecasts, and expansion of the customer base among high-profile global brands, are subject to such risks and uncertainties. Many factors could cause actual results to differ materially from the statements made, including those risks described from time to time in filings made by Jerash with the U.S. Securities and Exchange Commission. These and other risks and uncertainties are detailed in the Company’s filings with the U.S. Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated or expected. Statements contained in this news release regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Jerash does not intend and does not assume any obligation to update these forward-looking statements, other than as required by law.

 

Contact: 

 

PondelWilkinson Inc.  

Judy Lin or Roger Pondel  

310-279-5980

jlin@pondel.com

 

#   #   #

(tables below)

 

 

JERASH HOLDINGS (US), INC.,

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(UNAUDITED)

 

 

		For the Three Months Ended December 31,								For the Nine Months Ended December 31,
		2023				2022				2023				2022
Revenue, net		$	27,520,121			$	43,027,047			$	95,612,886			$	114,289,303
Cost of goods sold			23,057,845				37,230,421				80,211,039				94,952,523
Gross Profit			4,462,276				5,796,626				15,401,847				19,336,780
Selling, general and administrative expenses			3,843,029				4,469,967				12,318,535				12,796,749
Stock-based compensation expenses			243,448				-				727,698				294,822
Total Operating Expenses			4,086,477				4,469,967				13,046,233				13,091,571
Income from Operations			375,799				1,326,659				2,355,614				6,245,209
Other Income (Expenses):
Interest expenses			(234,971	)			(248,894	)			(983,156	)			(500,331	)
Other income, net			129,877				137,432				412,627				255,481
Total other expenses, net			(105,094	)			(111,462	)			(570,529	)			(244,850	)
Net income before provision for income taxes			270,705				1,215,197				1,785,085				6,000,359
Income tax expenses			38,535				324,379				688,856				1,596,407
Net income			232,170				890,818				1,096,229				4,403,952
Net gain attributable to noncontrolling interest			(11,457	)			-				(13,373	)			-
Net income attributable to Jerash Holdings (US), Inc.’s Common Stockholders		$	220,713			$	890,818			$	1,082,856			$	4,403,952
Net income		$	232,170			$	890,818			$	1,096,229			$	4,403,952
Other Comprehensive Income (Loss):
Foreign currency translation gain (loss)			99,171				37,804				(55,329	)			(296,066	)
Total Comprehensive Income			331,341				928,622				1,040,900				4,107,886
Comprehensive gain attributable to noncontrolling interest			(11,457	)			-				(13,373	)			-
Comprehensive Income Attributable to Jerash Holdings (US), Inc.’s Common Stockholders		$	319,884			$	928,622			$	1,027,527			$	4,107,886
Earnings Per Share Attributable to Common Stockholders:
Basic and diluted		$	0.02			$	0.07			$	0.09			$	0.35
Weighted Average Number of Shares
Basic			12,294,840				12,412,922				12,294,840				12,414,546
Diluted			12,294,840				12,412,922				12,294,840				12,467,315
Dividend per share		$	0.05			$	0.05			$	0.15			$	0.15

 

 

JERASH HOLDINGS (US), INC.,

AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

		December 31, 2023				March 31, 2023
		(Unaudited)
ASSETS
Current Assets:
Cash		$	19,617,630			$	17,801,614
Accounts receivable, net			8,472,674				2,240,537
Bills receivable			152,188				87,573
Inventories			15,937,648				32,656,833
Prepaid expenses and other current assets			2,582,886				2,964,578
Advance to suppliers, net			2,644,108				1,533,091
Total Current Assets			49,407,134				57,284,226
Restricted cash - non-current			1,608,784				1,609,989
Long-term deposits			782,697				841,628
Deferred tax assets, net			153,873				153,873
Property, plant and equipment, net			24,796,611				22,355,574
Goodwill			499,282				499,282
Right of use assets			541,612				974,761
Total Assets		$	77,789,993			$	83,719,333
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable		$	2,401,586			$	5,782,570
Accrued expenses			2,898,142				2,930,533
Income tax payable - current			1,736,484				2,846,201
Other payables			1,619,636				1,477,243
Deferred revenue			905				928,393
Operating lease liabilities - current			280,363				481,502
Total Current Liabilities			8,937,116				14,446,442
Operating lease liabilities - non-current			196,456				287,247
Income tax payable - non-current			417,450				751,410
Total Liabilities			9,551,022				15,485,099
Equity
Preferred stock, $0.001 par value; 500,000 shares authorized; none issued and outstanding		$	-			$	-
Common stock, $0.001 par value; 30,000,000 shares authorized; 12,534,318 shares issued, 12,294,840 shares outstanding			12,534				12,534
Additional paid-in capital			23,658,744				22,931,046
Treasury stock, 239,478 shares			(1,169,046	)			(1,169,046	)
Statutory reserve			410,847				410,847
Retained earnings			45,410,712				46,172,082
Accumulated other comprehensive loss			(178,558	)			(123,229	)
Total Jerash Holdings (US), Inc.’ Stockholders’ Equity			68,145,233				68,234,234
Noncontrolling interest			93,738				-
Total Equity			68,238,971				68,234,234
Total Liabilities and Equity		$	77,789,993			$	83,719,333

 

 

JERASH HOLDINGS (US), INC.,

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

 

		For the Nine Months Ended December 31,
		2023				2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net income		$	1,096,229			$	4,403,952
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			1,881,853				1,753,941
Stock-based compensation expenses			727,698				294,822
Bad debt recovery			(187,762	)			-
Amortization of operating lease right-of-use assets			601,727				784,699
Changes in operating assets:
Accounts receivable			(6,044,375	)			5,503,123
Bills receivable			(64,614	)			-
Inventories			16,719,185				1,591,135
Prepaid expenses and other current assets			350,324				424,867
Advance to suppliers			(1,111,017	)			(4,725,296	)
Changes in operating liabilities:
Accounts payable			(3,380,984	)			1,108,112
Accrued expenses			(32,390	)			(266,092	)
Other payables			142,393				(883,219	)
Deferred revenue			(927,488	)			296,985
Operating lease liabilities			(460,508	)			(661,274	)
Income tax payable, net of recovery			(1,443,317	)			232,632
Net cash provided by operating activities			7,866,954				9,858,387
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant, and equipment			(824,305	)			(587,613	)
Payments for construction of properties			(3,158,501	)			(3,414,172	)
Acquisition of Ever Winland			-				(5,100,000	)
Acquisition of Kawkab Venus			-				(2,200,000	)
Payment for long-term deposits			(281,153	)			(70,549	)
Net cash used in investing activities			(4,263,959	)			(11,372,334	)
CASH FLOWS FROM FINANCING ACTIVITIES
Dividend payments			(1,844,226	)			(1,865,241	)
Investment of noncontrolling interest			31,365				-
Share repurchase			-				(771,894	)
Repayment from short-term loan			(4,937,633	)			(1,756,360	)
Repayment to a related party			-				(300,166	)
Proceeds from short-term loan			4,937,633				6,162,743
Net cash (used in) provided by financing activities			(1,812,861	)			1,469,082
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND RESTRICTED CASH			24,677				(296,261	)
NET INCREASE (DECREASE) IN CASH AND RESTRICTED CASH			1,814,811				(341,126	)
CASH, AND RESTRICTED CASH, BEGINNING OF THE PERIOD			19,411,603				26,583,488
CASH, AND RESTRICTED CASH, END OF THE PERIOD		$	21,226,414			$	26,242,362
CASH, AND RESTRICTED CASH, END OF THE PERIOD			21,226,414				26,242,362
LESS: NON-CURRENT RESTRICTED CASH			1,608,784				1,615,353
CASH, END OF THE PERIOD		$	19,617,630			$	24,627,009
Supplemental disclosure information:
Cash paid for interest		$	983,156			$	500,331
Income tax paid		$	2,163,732			$	1,354,754
Non-cash investing and financing activities
Equipment obtained by utilizing long-term deposit		$	355,160			$	236,735
Acquisition of Kawkab Venus by utilizing long-term deposit		$	-			$	500,000
Right of use assets obtained in exchange for operating lease obligations		$	177,068			$	190,654

 

 

6

 

v3.24.0.1

Cover	Feb. 08, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Feb. 08, 2024
Entity File Number	001-38474
Entity Registrant Name	Jerash Holdings (US), Inc.
Entity Central Index Key	0001696558
Entity Tax Identification Number	81-4701719
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	277 Fairfield Road
Entity Address, Address Line Two	Suite 338
Entity Address, City or Town	Fairfield
Entity Address, State or Province	NJ
Entity Address, Postal Zip Code	07004
City Area Code	201
Local Phone Number	285-7973
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common stock, par value $0.001 per share
Trading Symbol	JRSH
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false

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