Armlogi Holding Corp (BTOC) 2024 Q3 法說會逐字稿

Thank you for standing by and welcome to the Armlogi Holding Corp third quarter, 2024 earnings call. Please note that today's call is being recorded. I will now turn the meeting over to Matthew Abenante, Investor Relations for Armlogi Holding Corp.

Thank you and thanks to everyone for joining us today for Armlogi's inaugural earnings call to discuss the third quarter of 2024. Please note that our earnings press release was issued earlier today and our quarterly report on Form 10-Q was filed with the Securities and Exchange Commission. Both are available on the Investor Relations section of our website at ir.armlogi.com.

Joining us on the call today are Aidy Chou, Chairman and Chief Executive Officer of Armlogi and Ian Zhou, Chief Financial Officer. The format of our call will consist of comments provided by management followed by a question and answer session addressing the questions that were submitted by investors. We thank everyone for submitting these questions. Before we get started, I am going to review the Safe Harbor statement.

Please note that today's discussion will contain forward-looking statement. In addition, from time to time, we are or our representatives may make forward-looking statements orally or in writing. We base these forward-looking statements on our expectations and projections about future events, which we derive from the information currently available to us.

Such forward-looking statements relate to future events or our future operating performance, including our financial performance and projections, our growth in revenue and earnings, and our business prospects and opportunities.

You can identify forward-looking statements by those that are not historical in nature, particularly those that use terminology such as may, should, expect, anticipate, contemplate, estimates, intends, beliefs, plans, projected, predict, potential or hold, or the negative of these or similar terms.

In evaluating these forward-looking statements, you should consider various factors including our ability to change the direction of the company, our ability to keep pace with new technologies and changing market needs, and the competitive environment of our business. These and other factors may cause our actual results to differ materially from any forward-looking statement.

Forward-looking statements are only predictions. We're not obligated to publicly update or revise any forward-looking statement. Whether as a result of uncertainties and assumptions. The forward-looking events discussed on this call and other statements made from time to time by us or our representatives may not occur and actual events and results may differ materially and are subject to risks, uncertainties, and assumptions about us.

And with that, I would like to hand the call to our first speaker, Aidy Chou, Chairman and CEO of Armlogi.

Good afternoon, Aidy.

Yeah, good afternoon, Matt and thank you all for joining us for our first earnings call as a public company following the closing of our initial public offering and the listing of a share on the Nasdaq in May. Our public listing was a synergic milestone but it was just one step in our vision to establish Armlogi as a leader in the global cross border logistics and warehousing space.

At Armlogi, our comprehension, warehousing and logistics service backed by cutting edge technology and its specializing equipment ensure that every delivery in the expectation of our global clientele, our innovation, dependability, and scalability. We are a expanding US based provider offering a complete sort of a supply chain solution in compensation, warehousing management, and order development.

The search in ecommerce and the digital technologies couples with the evolution of a global supply chain has led to growing demand from merchants to expanding their reach in the national platform like Amazon and eBay.

However, navigating the logistic complexities of a cross-border shipping was a challenger including mainly delivering time, high damaged risk and the congestion especially during peak season.

One solution to address this issue is the established of overseas warehouse typically located in foreign markets with its market selling goods. By pre-stocking inventory in these facilities, cross-border, e-commerce merchants can expect or document and reducing delivery time thereby handling the overall customer experience.

We're specializing in providing comprehensive warehousing and logistics support to cross-border e-commerce merchants targeting in the US market. With a network of 11 warehousing spend in the country and totaling more than 2.5 million square feet of space, we offer state of the first equipment with the (inaudible) system, heavy duty machinery and specializing in storage solution coming for handling, logic and [booey] items.

Our service customer first transportation in the US warehouse and efficient warehousing management and order fulfillment. Moreover, we extended our warehousing and logistics space to domestic e-commerce merchants with the US. Our offering of a domestic customer mirrored those provided to international client, unable to deliver similar integrated solution regarding of a geography scope.

In addition, the market we're offering in a significantly large and really growing, to put it into perspective, it is estimated that the market size for the global cross-border e-commerce in $2 trillion in 2022. And it's expected to reach over $4.3 trillion in 2027, the compound annual growth of 17% more.

Moreover, our business is supported by numerous internal caring including increased online shopping. There is breaking more in shopping cover and more business shipping to online platform as a way to increase delivery higher value.

Armlogi, our quality warehousing and logistics service, our ability to charge reasonable service and delivery fee and using advanced warehouse and management technology set up a part of a competition.

This digited advantage paved the way for our continued business growth. Our security will not be possible without our hardworking employer and a very big holder.

I would like to thank you partners and customers as we are loyal shareholders for your continued support. And a brief in our vision, we're looking forward to updating you on our business during the future earnings call. Now, I will turn it over to Ian Zhou, Chief Financial Officer of Armlogi for providing our overview of our operational and financial performance.

Perfect. Thank you, Aidy, and good afternoon everyone. For further information regarding our third quarter, 2024 financial resource and disclosures, please refer to our earnings release and our quarterly report on Form 10-Q that we filed with the SEC. Total revenue for the three months ended March 31, 2024 were $38.4 million up 28% from $30.1 million in the same period in 2023. Our transportation service segment reported revenue of $25 million, an increase of 18.2% from $21.2 million in the same period in 2023. This increase was driven by the rapid expansion of our business in 2023 as we expanded our warehouses operation capacity in California and New Jersey.

Our warehousing service segment generates $13.4 million, a 50.5% increase from the $8.9 million over the same period in 2023.

This growth was driven largely by the growth in our transportation service. This segment compress inventory management and source offering. Our other service segment generate revenue of $43,000 compared to the $82,000. In the same period in 2023. This segment is primarily comprised of the customer brokerage service.

Our net income was $0.4 million and $2.2 million for the three months and ended on March 31 2024 and 2023 respectively. Turning to our nine months resort total revenue for the nine months ended March 31, 2024 were $121.7 million, up 39.9% from $87 million in the same period in 2023. Our transportation service segment report the revenue of $84.7 million an increase of 36.6% from $62 million in the same period in 2023. The increase was driven by the rapid expansion of our business in 2023. And as we expand our warehouse operational capacity in California and New Jersey.

Our warehouse service segment generates $36.6 million, a 49.2% increase from $24.5 million over the same period in 2023. This increase was driven by the significant growth in our transportation service.

Our other service segment generate revenue of $0.4 million which were in line with those in the same period in 2023. Our net income was $7.2 million and $9 million dollars for the nine months ending March 31, 2024 and 2023 respectively.

Turning to our material development currently sub-sequentially to the end of the third quarter of 2024, as Aidy mentioned, we closed our initial public offering on the Nasdaq global market in May. That process for the offering allow us to expand our warehouse network and develop warehousing and logistics services. Develop international ocean freight service and develop poor trucking service among other things. We recently announced the expansion of our operation in the port of Savannah in Georgia, a critical hub for logistics and supply chain solution in the United States by signing a list for a new 733,000 square foot warehouse located close to the port.

The port of Savannah is home to the largest single terminal container facility of its kind in the North America and is the services container port gateway in the nation serving 33 weekly services. The most in the US, this new warehouse will significantly enhance our capacity to serve new clients with even greater efficiency and speed. We expect this strategy location of the port of Savannah will allow us to connect seamlessly with the global market and provide unparalleled assets to the large portion of the US population with two day transit.

Our continuous expansion is intended to meet growing demand and foster the delivery of expectational service to our clients.

Even more, earlier this month, we announced that we have become an authorized warehouse provider for seller on the TMU marketplace.

A major development for Armlogi, this agreement will enable the seller to asset Armlogi's advanced order management technology and warehouse services decided to optimize the supply chain process from warehouse to the doorstep. This enhancement will allow team sellers to leverage Armlogi's logistic expertise to improve the delivery speed, reduce the operational cost and enhance the overall customer experience.

We anticipate that this collaboration with a major ecommerce platform will further expand our capacity to serve more ecommerce sellers, offering re-boost support system on the global platform, helping them excel in this competitive ecommerce marketplace.

It enlighted well with our mission and empower the ecommerce business through the cutting edge logistics and warehousing solution and should positive impact our near term growth success while to strengthen our position as an emerging leader in the logistics industry.

Well, in conclusion, the third quarter of 2024 marked a period of notable advancement and expansion of for Armlogi. Positioned favorably, we are poised in the substantial of our moment and capacity on the opportunity in front of us. We will now transition to the question and answer portion of the call. Thank you to everyone who has submitted the questions.

Our first question is, can you discuss what makes your customers choose Armlogi over your competitors?

Definitely, that's a really good question. Our customer continue to work with us due to our longstanding relationship with them, which include our ability to meet their needs and earn their trust. Well, it's a highly competitive marketplace. This customer relationship has stood the rest of the time, pandemic and global supply chain issue, and we continue to deliver for them.

Our next question, with your recent announcement of the warehouse in Savannah, Georgia, are you looking at further warehouse expansion in the region and throughout the United States?

Yes, definitely. We eventually want to have more warehouse location in all the major ports of the entries throughout the US. And we believe that over time we'll get there. We will expand as our customer grows and volume grows.

Thank you. And our last question. Do you expect to continue to see growth in the transportation services segment leading to revenue growth in warehousing services?

Yes. That's a for sure question. As our transportation service segment which mostly entirely feathers as ocean fridge and truck delivery continue to grow, this should lead to expanding our warehouse services which include the inventory management, all the fulfillment, and storage services.

Thank you Ian and thanks to everyone for participating on today's call. We look forward to providing additional updates in the near future. And in the meantime, we can be reached at info@armlogi.com or you can contact me directly at matthew@strategic/ir.com.

Ladies and gentlemen, that concludes our conference for today. Thank you for your participation. You may now disconnect.