Lakeside Holding Limited

Thank you for standing by and welcome to the Lakeside Holding Limited Fiscal 2025 Third Quarter and Nine Month Earnings Conference Call. Please note that today's call is being recorded. I will now turn the meeting over to Matthew Abinante, Investor Relations for Lakeside Holding Limited.

Thank you and thanks to everyone joining us today for Lakeside Holding Limited's Earnings Conference Call. to discuss our financial results for the third quarter and nine months of fiscal year 2025. Please note that our earnings press release was issued last week, and our quarterly report on Form 10Q was filed with the Securities and Exchange Commission. Both documents are available in the Investor Relations section of our website at lakeside-holding.com. Joining me on the call today is Henry Liu, Chief Executive Officer of Lakeside Holding Limited. Before we begin, I would like to review the Safe Harbor Statement. Please be aware that today's discussion will contain forward-looking statements that reflect our current expectations and views of future events. These statements are subject to known and unknown risks, uncertainties, and other factors that may cause our actual results performance, or achievements to be materially different from those expressed or implied by the forward-looking statements. You can identify some of these forward-looking statements by words or phrases, such as may, will, expect, anticipate, aim, estimate, intend, plan, believe, is, are likely to, potential, continue, or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, and financial needs. These forward-looking statements involve various risks and uncertainties. For a detailed discussion of these risks and uncertainties, please refer to our filings with the SEC, including our annual report on Form 10-K and our quarterly reports on Form 10-Q. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events, or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. We qualify all of our forward-looking statements by these cautionary statements. And with that, I would like to hand the call over to Henry Liu, Chief Executive Officer of Lakeside. Henry, please go ahead.

Good afternoon, Matt, and thank you, everyone, for joining us today. We appreciate you taking the time to participate in our physical 2025 third quarter and nine-month earnings conference call. This period has been a dynamic one for Lixite, marked by challenges in our established markets and existing progress in our new strategic ventures. We are navigating a shifting global landscape with a clear focus on long-term growth and shareholder value. and I'm pleased to share our progress and outlook with you, our valued shareholders. Reflecting on the first nine months of fiscal 2025, we reported total revenues of $11.48 million for the nine months ended March 31.25, while this represents a decrease from the 13.53 million record in the same period of last year, it's important to contextualize these figures. Our traditional cross-border free solutions operated through American Bear Logistics saw revenue of 10.76 million for the nine months. compared to the $13.53 million in the premier year. This decline is primarily attributable to the normalization of global shipping demands and the persistent pricing pressures with the freight sector, a trend observed across the industry. For the third quarter specifically, total revenues were $3.8 million compared to the full $246 million in the third quarter of fiscal 2024, with our cross-border freight solutions contributing $3.31 million. Despite these headwinds in the freight segment, we are particularly encouraged by the initial performance and the strategic importance of our recent expansion into the pharmaceutical distribution sector. Following our acquisition of Hupan Pharmaceutical Hubei Company in November, 2024, this new segment has already begun to contribute our top line generating 715 362 in revenue for the nine months is ended march 31.25 and 497 276 in the third quarter alone this is a testament to the significant growth opportunities we see in Chinese pharmaceutical market. We are actively working to integrate Hupan Pharmaceutical into our border operations, aiming to unlock synergies and expand our service offerings. Our gross profit for nine months stood at 1.20 million, And for the third quarter, it was $0.72 million. The decrease from pre-year periods reflects the ephemeral pressure in freight market. Operating expense for the nine months totaled $5.60 million. And for the third quarter, $1.80 million. These figures include investment related to our expansion, such as selling expense of 158,117 for nine months, period like 103 and 629 for the third quarter, which were not present in the pre-year, as well as increase the general and administrative expense associated with our growth initiatives and the public company operations. Consequently, we record a loss from operation of 4.40 million from the nine months and 1.10 million for the third quarter. Our net loss attributable to the company for the nine months was 4.35 million or 0.58 per share. And for the third quarter, it was 1.07 million or 0.14 per share. Well, these results reflect the current market conditions and our ongoing investments. We are taking proactive steps to manage costs, optimize our existing operations, and drive towards Profitably, the successful completion of our initial public offering on July 1, 2024, which raised the growth process of approximately $6.75 million, has provided us with the necessary capital to fulfill our strategy initiatives. Furthermore, The convertible debit financing agreement for up to $4.5 million announced in March 2025 will provide additional working capital to support the growth of our pharmaceutical distribution business and for general corporate purpose, further strengthening our financial flexibility. Looking at the border macroeconomic environment, we are closely monitoring developments in international trade relations, particularly the ongoing tariff discussions between the United States and China. Recent signals suggest a potential easing of tensions with the tariff choose offering a degree of cautious optimism for the global markets. Well, the situation remains fluid and the current agreement is more opposed than a comprehensive resolution. Any execution is a positive sign for global trade flows. As a company with significant focus on the Asian Pacific market, particularly the U.S.-China trade line, we will this development with hopefully a more stable and predictable trade environment would undoubtedly benefit our cross-border logistics operations and create a more favorable back job for our extension efforts in China. We remain agile and prepared to adapt our strategies as the situation evolves, always with the goal of mitigating risk and capitalizing our emerging opportunities. Our strategic objectives for the remainder of FY2025 and beyond are clear. First, we are committed to aggressively expanding our footprint in China from a surgical distribution market. This involves integrating coupon firmware suitable seamlessly, actively purchasing new distribution agreements and boarding our product portfolio. We are already progressing in discussion with major pharmaceutical procedures such as Kulin Pharmaceutical and are excited about the potential in this high-growth sector. Second, we will continue to optimize our cross-border logistics service. While the market is challenging, American Bear Logistics has a strong reputation and a resilient customer base. We will focus on providing high volume customized solutions and adapting the involving needs of our clients in Asian Pacific to US trade line. Third, we will diligently manage our capital and resources, ensuring that our investments are directed towards initiatives that promise the highest return and contribute to suitable long-term shareholder value. In condition, while the past nine months have presented a complex operating environment, we are confident in our strategic direction. Diversifying into the pharmaceutical sector, coupled with our established expertise in cross-border logistics and our strategy and financial position post-IPO, positions Lakeside for a promising future. We are building a more resilient and diversified business, post to capitalize on growth opportunities in key markets. We remain optimistic about navigating the current challenges and delivering value to our shareholders. I want to thank our dedicated team for their hard work and commitment during this transformative period. I also want to thank our shareholders for your continued support and confidence in Lakeside. With that, I will now turn the call over to the operator to begin the question and answer session.