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): August 9, 2023

 

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 August 9, 2023, Jerash Holdings (US), Inc. issued a press release to announce financial results for its fiscal year 2024 first quarter, ended June 30, 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 August 9, 2023
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.
August 9, 2023	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 Financial Results

for Fiscal 2024 First Quarter

 

FAIRFIELD, N.J., August 9, 2023 – Jerash Holdings (US), Inc. (NASDAQ: JRSH) (the “Company” or “Jerash”), which manufactures and exports custom, ready-made, sportswear and outerwear for leading global brands, today announced financial results for its fiscal 2024 first quarter, ended June 30, 2023.

 

“Our first quarter demonstrated the Company’s resiliency in a challenging retail environment. Revenue was up slightly, although, as expected, profitability was impacted, principally caused by a product mix shift to lower margin items,” said Sam Choi, Jerash’s chairman and chief executive officer. “We are beginning to see improvement in the retail market and are receiving new inquiries from global brands, including orders to produce sample products.

 

“The Initial marketing efforts by our joint venture partner, Busana Apparel Group, to its global customers are being well received. Jerash has begun working on pricing and sample development for more than ten new brands. We anticipate receiving meaningful orders for the joint venture during the fourth quarter of the current fiscal year.

 

“Additionally, we have been in discussion with one of the global leaders in sustainable textile dyeing technology to form a joint venture to provide vertical integration for our customers. The plan is to bring about a new era of sustainable and innovative textile dyeing process in Jordan, with a proprietary technology that, according to the presentation and information from the potential partner, could result in more than 80 percent water usage reduction and 50 percent carbon footprint reduction from traditional textile dyeing process. The proposed joint venture is expected to benefit our customers through shortening fabric sourcing lead times and will further reduce dependency on suppliers in South East and Eastern Asia,” Choi added.

 

Fiscal 2024 First Quarter Results

 

Fiscal 2024 first quarter revenue advanced to $34.7 million, up 3.9 percent, from $33.4 million in the same period last year, reflecting an increase in shipments to some of the Company’s major U.S. customers.

 

Gross profit was $5.6 million for the fiscal 2024 first quarter, compared with $6.6 million in the same quarter last year. Gross margin for the most recent first quarter decreased to 16.0 percent, from 19.8 percent in the same period last year, principally due to a shift in product mix.

 

Operating expenses totaled $4.5 million in the fiscal 2024 first quarter, compared with $4.3 million in the same period last year.

 

 

Operating income totaled $1.1 million in the fiscal 2024 first quarter, versus $2.3 million in the same period last year.

 

Total other expenses were $299,000 in the fiscal 2024 first quarter, compared with $28,000 in the same quarter last year. The increase was primarily due to higher interest expenses that occurred from participating in supply chain financing programs of certain customers. Interest expenses were $389,000 in the fiscal 2024 first quarter, compared with $88,000 a year ago.

 

The effective tax rate amounted to 38 percent for the three months ended June 30, 2023, compared with 25 percent for the three months ended June 30, 2022. The increase primarily resulted from a higher corporate income tax rate in Jordan, higher proportion of the operating loss of the Company’s holding company and Hong Kong subsidiary.

 

Net income was $495,000, or $0.04 per share, in the fiscal 2024 first quarter, compared with $1.7 million, or $0.14 per share, in the same period last year. Comprehensive income attributable to the Company’s common stockholders totaled $402,000 in the fiscal 2024 first quarter, versus $1.6 million in the same period last year.

 

Balance Sheet, Cash Flow, and Dividends

 

Cash and restricted cash totaled $20.1 million, and net working capital was $41.5 million as of June 30, 2023. Net cash provided by operating activities was approximately $25,000 for the quarter ended March 30, 2023, compared with net cash used in operating activities of $473,000 for the same period last year.

 

On August 4, 2023, Jerash approved a regular quarterly dividend of $0.05 per share on its common stock, payable on August 23, 2023 to stockholders of record as of August 16, 2023.

 

Outlook

 

●

Revenue for the full fiscal 2024 year is expected to be approximately the same as fiscal 2023.

 

●

Gross margin goal for the full fiscal 2024 year is expected to be approximately 15-16 percent.

 

Conference Call

 

Jerash Holdings will host an investor conference call to discuss its fiscal 2024 first quarter results today, August 9, 2023, at 9:00 a.m. Eastern Time. 

 

Phone:	888-506-0062 (domestic); 973-528-0011 (international)
Conference ID:	666417

 

 

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 Securities and Exchange Commission. In addition, there is uncertainty about the further spread of the COVID-19 virus or the occurrence of another wave of cases and the impact it may have on the Company’s operations, the demand for the Company’s products, global supply chains and economic activity in general. These and other risks and uncertainties are detailed in the Company’s filings with the 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

 

		For the Three Months Ended June 30,
		2023				2022
Revenue, net		$	34,735,657			$	33,436,561
Cost of goods sold			29,168,117				26,814,194
Gross Profit			5,567,540				6,622,367
Selling, general and administrative expenses			4,234,918				4,018,698
Stock-based compensation expenses			240,802				294,822
Total Operating Expenses			4,475,720				4,313,520
Income from Operations			1,091,820				2,308,847
Other Income (Expenses)
Interest expenses			(388,951	)			(87,842	)
Other income, net			90,227				60,242
Total other expenses, net			(298,724	)			(27,600	)
Net income before provision for income taxes			793,096				2,281,247
Income tax expenses			297,981				559,865
Net income			495,115				1,721,382
Net loss attributable to noncontrolling interest			1,411				-
Net income attributable to Jerash Holdings (US), Inc.’s Common Stockholders		$	496,526			$	1,721,382
Net income		$	495,115			$	1,721,382
Other Comprehensive Loss
Foreign currency translation loss			(94,659	)			(117,660	)
Total Comprehensive Income			400,456				1,603,722
Comprehensive loss attributable to noncontrolling interest			1,411				-
Comprehensive Income Attributable to Jerash Holdings (US), Inc.’s Common Stockholders		$	401,867			$	1,603,722
Earnings Per Share Attributable to Common Stockholders
Basic and diluted		$	0.04			$	0.14
Weighted Average Number of Shares
Basic			12,294,840				12,336,516
Diluted			12,294,840				12,502,378
Dividend per share		$	0.05			$	0.05

 

 

JERASH HOLDINGS (US), INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

 

		June 30, 2023				March 31, 2023
		(Unaudited)
ASSETS
Current Assets:
Cash		$	18,459,939			$	17,801,614
Accounts receivable, net			6,410,457				2,240,537
Bills receivable			-				87,573
Tax recoverable			-				16,763
Amount due from a related party			31,365				-
Inventories			23,800,407				32,656,833
Prepaid expenses and other current assets			2,885,651				2,947,815
Advance to suppliers, net			3,212,701				1,533,091
Total Current Assets			54,800,520				57,284,226
Restricted cash - non-current			1,611,294				1,609,989
Long-term deposits			1,105,790				841,628
Deferred tax assets, net			153,873				153,873
Property, plant and equipment, net			23,255,357				22,355,574
Goodwill			499,282				499,282
Right of use assets			940,800				974,761
Total Assets		$	82,366,916			$	83,719,333
LIABILITIES AND  EQUITY
Current Liabilities:
Accounts payable		$	3,571,002			$	5,782,570
Accrued expenses			2,444,811				2,930,533
Credit facilities			3,117,337				-
Income tax payable - current			1,892,181				2,846,201
Other payables			1,273,690				1,477,243
Deferred revenue			625,132				928,393
Operating lease liabilities - current			413,412				481,502
Total Current Liabilities			13,337,565				14,446,442
Operating lease liabilities - non-current			319,786				287,247
Income tax payable - non-current			417,450				751,410
Total Liabilities			14,074,801				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			23,171,848				22,931,046
Treasury stock, 239,478 shares			(1,169,046	)			(1,169,046	)
Statutory reserve			410,847				410,847
Retained earnings			46,053,866				46,172,082
Accumulated other comprehensive loss			(217,888	)			(123,229	)
Total Jerash Holdings (US), Inc. Stockholders’ Equity			68,262,161				68,234,234
Noncontrolling interest			29,954				-
Total Equity			68,292,115				68,234,234
Total Liabilities and Equity		$	82,366,916			$	83,719,333

 

 

JERASH HOLDINGS (US), INC. AND SUBSIDIARIES

 

		For the Three Months Ended June 30,
		2023				2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net income		$	495,115			$	1,721,382
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization			608,776				630,999
Stock-based compensation expenses			240,802				294,822
Amortization of operating lease right-of-use assets			205,112				238,758
Changes in operating assets:
Accounts receivable			(4,169,920	)			(30,644	)
Bills receivable			87,573				-
Inventories			8,856,426				(717,470	)
Prepaid expenses and other current assets			62,161				369,709
Advance to suppliers			(1,679,610	)			(2,166,500	)
Changes in operating liabilities:
Accounts payable			(2,211,568	)			(649,556	)
Accrued expenses			(485,721	)			139,879
Other payables			(203,553	)			(620,436	)
Deferred revenue			(303,261	)			137,982
Operating lease liabilities			(206,702	)			(207,923	)
Income tax payable, net of recovery			(1,270,858	)			386,262
Net cash provided by (used in) operating activities			24,772				(472,736	)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant and equipment			(61,258	)			(151,263	)
Payments for construction of properties			(1,434,965	)			(1,810,075	)
Acquisition deposit			-				(1,267,407	)
Payments for long-term deposits			(276,498	)			(151,967	)
Net cash used in investing activities			(1,772,721	)			(3,380,712	)
CASH FLOWS FROM FINANCING ACTIVITIES
Dividend payment			(614,742	)			(616,716	)
Repayment to a related party			-				(300,166	)
Proceeds from short-term loan			3,117,337				-
Net proceeds from issuance of common stock			-				1,130,046
Net cash provided by financing activities			2,502,595				213,164
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND RESTRICTED CASH			(95,016	)			(117,852	)
NET INCREASE (DECREASE) IN CASH AND RESTRICTED CASH			659,630				(3,758,136	)
CASH, AND RESTRICTED CASH, BEGINNING OF THE PERIOD			19,411,603				26,583,488
CASH, AND RESTRICTED CASH, END OF THE PERIOD		$	20,071,233			$	22,825,352
CASH, AND RESTRICTED CASH, END OF THE PERIOD			20,071,233				22,825,352
LESS: NON-CURRENT RESTRICTED CASH			1,611,294				1,328,033
CASH, END OF THE PERIOD		$	18,459,939			$	21,497,319
Supplemental disclosure information:
Cash paid for interest		$	388,951			$	87,842
Income tax paid		$	1,585,961			$	531,493
Non-cash investing and financing activities
Equipment obtained by utilizing long-term deposit		$	25,464			$	244,667
Investment of noncontrolling interest		$	31,365			$	-
Right of use assets obtained in exchange for operating lease obligations		$	177,068			$	68,932

 

 

-6-

v3.23.2

Cover	Aug. 09, 2023
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Aug. 09, 2023
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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