Form 8-K - Current report

 

 

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 13, 2024

 

Maison Solutions Inc. 
(Exact name of registrant as specified in its charter)

 

Delaware		001-41720		84-2498787
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

 

127 N Garfield Ave, Monterey Park, California 91754
(Address of principal executive offices) (Zip Code) 

 

Registrant’s telephone number, including area code: [phone]

 

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
Class A common stock, $0.0001 par value per share		MSS		The Nasdaq Stock Market LLC

 

Indicate by check mark whether the registrant is an emerging growth company as defined in 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 checkmark 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 13, 2024, Maison Solutions Inc. (the “Company”) issued a press release reporting its financial results for the year ended April 30, 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

 

The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date of this Current Report on Form 8-K, regardless of any general incorporation language in the filing.

 

Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits

 

Exhibit No.		Description
99.1		Press Release, dated August 13, 2024
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

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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.

 

Date: August 14, 2024	MAISON SOLUTIONS INC.
	By:	/s/ John Xu
		John Xu
		Chief Executive Officer, Chairman and President

 

 

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Exhibit 99.1

 

 

Maison Solutions Reports Full Year 2024 Financial Results

 

MONTEREY PARK, Calif. / ACCESSWIRE / August 13, 2024 / Maison Solutions Inc. (“Maison Solutions” or the “Company”), (NASDAQ: MSS), a U.S.-based specialty grocery retailer offering traditional Asian and international food and merchandise, today announced financial results for full year ended April 30, 2024.

 

Management Commentary

 

“Following the successful IPO last October, we have made significant strides in expanding our footprint and enhancing our operational capabilities,” said John Xu, President, Chairman and Chief Executive Officer of Maison Solutions. “The accretive acquisition of Lee Lee this past April was a pivotal step in fueling our growth strategy, allowing us to extend the Maison brand beyond the California border and into the state of Arizona. The three acquired stores have seamlessly merged under the Maison umbrella and are expected to more than double our current top-line figures while maintaining their profitability. We believe this acquisition will serve as the cornerstone of our growth in the coming year, as we look forward to reaping the financial benefits while exploring synergistic opportunities between our HK Good Fortune stores in California and the Lee Lee stores.”

 

“We also remain committed to the organic growth of our HK Good Fortune stores, specifically the renovation and digital transformation initiatives starting with our El Monte store, which is scheduled to be completed by the end of 2024. We are very confident in the outlook of our business and importantly, maximizing shareholder value.”

 

Full Year 2024 and Recent Operational Highlights

 

●

Held a post-acquisition webinar detailing the Lee Lee International Supermarkets (“Lee Lee”) acquisition

 

●

Acquired Lee Lee, a three-store supermarket chain operating in the greater Phoenix and Tucson, Arizona metro areas

 

●

Launched a Store Renovation Program that integrated a new software program and included exterior and interior upgrades to the HK Good Fortune supermarket in El Monte, California

 

●

Presented at the Emerging Growth Conference

 

●

Completed a $10 million IPO on the Nasdaq Capital Market

 

Full Fiscal Year 2024 Financial Results

 

Total net revenues for fiscal year 2024 increased 4.8% to $58.0 million compared to $55.4 million last fiscal year. The increase was primarily driven by the inclusion of revenues from the newly acquired subsidiary, Lee Lee, of $4.6 million and increased sales of Maison Monterey Park supermarket by $4.4 million.

 

 

 

 

 

Perishable goods revenues for fiscal year 2024 increased 0.2% to $31.4 million compared to $31.3 million last fiscal year. Non-perishable goods revenues for fiscal year 2024 increased 10.7% to $26.7 million compared to $24.1 million last fiscal year.

 

Total cost of revenues for fiscal year 2024 was $46.4 million compared to $42.9 million last fiscal year. The increase was primarily due to a corresponding increase in revenue, an increase in write-off inventory from the Lee Lee acquisition, and increased occupancy costs of existing supermarkets and Lee Lee.

 

Gross profit for fiscal year 2024 was $11.6 million, while gross margin was 20.0%. Gross profit for fiscal year 2023 was $12.5 million, while gross margin was 22.5%. The decrease was primarily due to an increase in write-off inventory from the Lee Lee acquisition, and increased occupancy costs of existing supermarkets and Lee Lee.

 

Net loss for fiscal year 2024 was approximately $3.3 million, compared to net income of approximately $1.3 million last fiscal year. The net loss was primarily due to a decrease in gross profit and other income, and an increase in investment loss from equity method investment, operating expenses, and income tax expense.

 

Fiscal Year 2025 Guidance

 

The Company is reiterating the following guidance for fiscal year 2025:

 

●

Revenues between $120 million and $125 million

 

●

Net income positive

 

About Maison Solutions Inc.

 

Maison Solutions Inc. is a U.S.-based specialty grocery retailer offering traditional Asian food and merchandise, particularly to members of Asian-American communities. The Company is committed to providing Asian fresh produce, meat, seafood, and other daily necessities in a manner that caters to traditional Asian-American family values and cultural norms, while also accounting for the new and faster-paced lifestyle of younger generations and the diverse makeup of the communities in which the Company operates. Since its formation in 2019, the Company has acquired equity interests in four traditional Asian supermarkets in the Los Angeles, California area, operating under the brand name HK Good Fortune, and three supermarkets in the Phoenix and Tucson, Arizona metro areas, operating under the brand name Lee Lee International Supermarket. To learn more about Maison Solutions, please visit the Company’s website at www.maisonsolutionsinc.com. Follow us on LinkedIn and X.

 

Cautionary Note Concerning Forward-Looking Statements

 

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. We caution readers that forward-looking statements are predictions based on our current expectations about future events. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict. Our actual results, performance, or achievements could differ materially from those expressed or implied by the forward-looking statements as a result of a number of factors, including the risks discussed under the heading “Risk Factors” discussed under the caption “Item 1A. Risk Factors” in Part I of our most recent Annual Report on Form 10-K or any updates discussed under the caption “Item 1A. Risk Factors” in Part II of our Quarterly Reports on Form 10-Q and in our other filings with the SEC, copies of which are available on the SEC’s website at www.sec.gov. Maison Solutions undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise that occur after the date of this release, except as required by law.

 

Investor Relations and Media Contact:

 

Gateway Group, Inc.

[phone]

[e-mail]

 

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MAISON SOLUTIONS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

 

		Years Ended April 30,
		2024				2023
Revenue		$	58,043,161			$	55,399,112
Cost of goods sold			46,422,064				42,947,952
Gross profit			11,621,097				12,451,160
Operating expenses:
Selling expenses			10,155,828				8,479,578
General and administrative expenses			4,169,275				3,887,935
Total operating expenses			14,325,103				12,367,513
Income (loss) from operations			(2,704,006	)			83,647
Non-operating income (expenses):
Interest income (expense), net			(124,260	)			42,606
Investment loss from equity method investment			(538,542	)
Other income, net			420,341				1,849,534
Non-operating income (expenses), net			(242,461	)			1,892,140
Income (loss) before income tax			(2,946,467	)			1,975,787
Income tax provisions			440,562				336,486
Net income (loss) before noncontrolling interest			(3,387,029	)			1,639,301
Net income (loss) attributable to noncontrolling interest			(46,823	)			387,498
Net income (loss) attributable to Maison Solutions Inc.		$	(3,340,206	)		$	1,251,803
Net income (Loss) per share attributable to Maison Solutions, Inc.
- basic and diluted		$	(0.19	)		$	0.08
Weighted average number of common stock outstanding – basic and diluted			17,913,869				16,000,000

 

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MAISON SOLUTIONS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

 

		April 30, 2024				April 30, 2023
ASSETS
Current assets:
Cash and cash equivalents		$	—			$	2,569,766
Accounts receivable			111,874				315,356
Accounts receivable – related parties			459,647				289,615
Inventories, net			6,802,255				2,978,986
Prepayments			3,263,711				1,547,243
Other receivables and other current assets			1,240,786				550,836
Other receivable – related parties			33,995				33,995
Total current assets			11,912,268				8,285,797
Non-current assets:
Restricted cash			1,101				1,101
Property and equipment, net			2,334,963				671,463
Intangible assets, net			7,978,911				197,329
Security deposits			946,208				457,491
Investment under cost method			75,000				—
Investment under cost method – related parties			203,440				203,440
Investment in equity securities			1,261,458				—
Operating lease right-of-use assets, net			40,726,647				22,545,190
Goodwill			16,957,147				2,222,211
Total non-current assets			70,484,875				26,298,225
Total assets		$	82,397,143			$	34,584,022
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Bank overdraft		$	97,445			$	—
Accounts payable			5,394,423				3,105,592
Accounts payable – related parties			470,605				465,310
Accrued expenses and other payables			1,627,082				867,796
Other payables – related parties			491,586				241,585
Income tax payable			442,518				961,034
Contract liabilities			965,696				449,334
Operating lease liabilities, current			4,088,678				1,761,182
Loan payables, current			65,098				370,828
Notes payable, current			15,126,065				150,000
Total current liabilities			28,769,196				8,372,661
Non-current liabilities:
Long-term loan payables			2,496,201				2,561,299
Security deposit from sub-tenants			125,114				105,637
Operating lease liabilities, non-current			39,015,252				22,711,760
Deferred tax liability, net			1,272,260				40,408
Total non-current liabilities			42,908,827				25,419,104
Total Liabilities			71,678,023				33,791,765
Commitment and contingencies (Note 17)
Stockholders’ Equity:
Class A Common stock, $0.0001 par value, 97,000,000 shares authorized; 17,450,476 and 13,760,000 shares issued and outstanding as of April 30, 2024 and 2023, respectively			1,745				1,376
Class B Common stock, $0.0001 par value, 3,000,000 shares authorized; 2,240,000 shares issued and outstanding			224				224
Additional paid in capital			13,313,523				—
Retained earnings (accumulated deficit)			(2,817,495	)			522,710
Total Maison Solutions, Inc. stockholders’ equity			10,497,997				524,310
Noncontrolling interests			221,123				267,947
Total stockholders’ equity			10,719,120				792,257
Total liabilities and stockholders’ equity		$	82,397,143			$	34,584,022

 

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MAISON SOLUTIONS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

		Years Ended April 30,
		2024				2023
Cash flows from operating activities
Net income (loss) before noncontrolling interest		$	(3,387,029	)		$	1,639,301
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization expense			461,868				371,696
Inventory impairment			(5,961	)			(130,056	)
Bad debt expense			(60,000	)			225,766
Investment loss			538,542				—
Change in deferred taxes			(11,698	)			(3,125	)
Changes in operating assets and liabilities:
Accounts receivable			203,481				(258,309	)
Accounts receivable - related parties			(271,461	)			243,881
Inventories			914,356				343,513
Prepayments			(1,716,468	)			(819,592	)
Other receivables and other current assets			(474,943	)			(504,758	)
Security deposits			(488,717	)			5,654
Accounts payable			(59,633	)			(589,651	)
Accounts payable - related parties			106,725				(161,677	)
Accrued expenses and other payables			342,592				(503,338	)
Income tax payable			(518,516	)			334,622
Contract liabilities			503,326				68,037
Operating lease liabilities			400,913				203,940
Other long-term payables			19,477				18,287
Net cash provided by (used in) operating activities			(3,503,146	)			484,191
Cash flows from investing activities
Payments of equipment purchase			(382,132	)			(49,388	)
Payments for intangible assets purchase			(2,950,000	)			—
Investment into TMA Liquor Inc.			(75,000	)			—
Investment into HKGF Market of Arcadia, LLC			(1,800,000	)			—
Payment for acquisition of subsidiaries			(7,000,000	)			(2,500,000	)
Loans repaid from third parties			—				4,410,270
Net cash provided by (used in) investing activities			(12,207,132	)			1,860,882
Cash flows from financing activities
Bank overdraft			97,445				(281,941	)
Repayments (to) borrowings from related parties			250,000				(101,965	)
Repayments of loan payables			(370,825	)			(362,731	)
Repayment of notes payable			(150,000	)			—
Net proceeds from issuance of common stock			13,313,892				—
Net cash provided by (used in) financing activities			13,140,512				(746,637	)
Net changes in cash and restricted cash			(2,569,766	)			1,598,436
Cash and restricted cash at the beginning of the year			2,570,867				972,431
Cash and restricted cash at the end of the year		$	1,101			$	2,570,867
Supplemental disclosure of cash and restricted cash
Cash		$	—			$	2,569,766
Restricted cash			1,101				1,101
Total cash and restricted cash		$	1,101			$	2,570,867
Supplemental disclosure of cash flow information
Cash paid for interest		$	104,451			$	70,795
Cash paid for income taxes		$	973,656			$	8,481
Supplemental disclosure of non-cash investing and financing activities
Increase of right-of-use assets and lease liabilities		$	10,196			$	8,454,300

 

 

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Cover	Aug. 13, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Aug. 13, 2024
Entity File Number	001-41720
Entity Registrant Name	Maison Solutions Inc.
Entity Central Index Key	0001892292
Entity Tax Identification Number	84-2498787
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	127 N Garfield Ave
Entity Address, City or Town	Monterey Park
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	91754
City Area Code	626)
Local Phone Number	737-5888
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Class A common stock, $0.0001 par value per share
Trading Symbol	MSS
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false

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