TIAN RUIXIANG Holdings Ltd Reports Fiscal Year 2021 Financial Results
Tian Ruixiang Holdings Ltd (NASDAQ: TIRX) reported a 14.1% decrease in revenue for fiscal year 2021, totaling $2.79 million, down from $3.25 million in 2020. This revenue decline was mainly due to reduced commissions from individual accidental insurance and a drop in risk management services. Operating expenses surged by 87.6% to $5.04 million, leading to a net loss of $1.94 million compared to net income of $0.63 million in the previous year. Despite challenges, the company opened a new branch and plans to expand its insurance offerings.
- Established a new branch in Yunnan in November 2021 to enhance service coverage.
- Plans to focus on growing property and group insurance business.
- Revenue decreased by 14.1% to $2.79 million due to loss of insurance company partner.
- Operating expenses increased by 87.6% to $5.04 million.
BEIJING, March 7, 2022 /PRNewswire/ -- TIAN RUIXIANG Holdings Ltd (Nasdaq: TIRX) (the "Company"), a China-based insurance broker conducting business through its variable interest entity in China, announced today its financial results for the fiscal year ended October 31, 2021.
Mr. Zhe Wang, Chairman of the board of the directors and Chief Executive Officer of the Company, commented, "In fiscal year 2021, our revenue was down by
Fiscal Year 2021 Financial Highlights
For the Fiscal Years Ended October 31, | |||||
($ in millions, except per share data) | 2021 | 2020 | % Change | ||
Revenue | 2.79 | 3.25 | - | ||
Operating expenses | 5.04 | 2.69 | |||
(Loss) income from operations | (2.25) | 0.56 | NM | ||
Operating margin | (80.8)% | NM | |||
Net (loss) income | (1.94) | 0.63 | NM | ||
(Loss) income per share | (0.23) | 0.13 | NM | ||
Note: NM refers to "Not Meaningful" | |||||
- Revenue decreased by
14.1% to$2.79 million for fiscal year 2021, from$3.25 million for fiscal year 2020, primarily attributable to a decrease in commissions from individual accidental insurance of approximately$0.36 million resulting from the loss of an insurance company partner and a decrease in our risk management services revenue from the provision of insurance related risk management services of approximately$0.18 million . - Operating expenses increased by
87.6% to$5.04 million for fiscal year 2021, from$2.69 million for fiscal year 2020. - Operating margin was (80.8)% for fiscal year 2021, compared to
17.2% for fiscal year 2020. - Net loss was
$1.94 million for fiscal year 2021, compared to net income of$0.63 million for fiscal year 2020. - Loss per share was
$0.23 for fiscal year 2021, compared to income per share of$0.13 for fiscal year 2020.
Fiscal Year 2021 Financial Results
Revenue
Revenue decreased by
Operating Expenses
Third-party and related-party selling and marketing expenses increased by
Third-party and related-party general and administrative expenses increased by
Total operating expenses increased by
(Loss) Income from Operations
Loss from operations was
The operating margin was (80.8)% for fiscal year 2021, compared to an operating margin of
Other Income (Expense)
Other income (expense) primarily included interest income from third-party and related-party notes receivable and bank deposits, interest expense incurred from our third-party and related-party borrowings, and miscellaneous income. Other income was
(Loss) Income before Income Tax
Loss before income tax was
Income tax expense was
Net (Loss) Income and (Loss) Income per Share
Net loss was
Financial Conditions
As of October 31, 2021, the Company had cash and cash equivalents of
Net cash used in operating activities was
Net cash used in investing activities was
Net cash provided by financing activities was
About TIAN RUIXIANG Holdings Ltd
TIAN RUIXIANG Holdings Ltd, headquartered in Beijing, China, is an insurance broker operating in China through its China-based variable interest entity. It distributes a wide range of insurance products, which are categorized into two major groups: (1) property and casualty insurance, such as automobile insurance, commercial property insurance, liability insurance; and (2) life insurance, such as individual and group life insurance. Additionally, the Company also provides risk management services to institutional customers. For more information, visit the company's website at http://ir.tianrx.com/.
Forward-Looking Statements
Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review risk factors that may affect its future results in the Company's registration statement and in its other filings with the SEC.
For investor and media enquiries, please contact:
TIAN RUIXIANG Holdings Ltd
Investor Relations Department
Email: ir@tianrx.com
Ascent Investor Relations LLC
Tina Xiao
Phone: +1 917-609-0333
Email: tina.xiao@ascent-ir.com
TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES | ||||||
CONSOLIDATED BALANCE SHEETS | ||||||
(IN U.S. DOLLARS) | ||||||
As of October 31, | ||||||
2021 | 2020 | |||||
ASSETS | ||||||
CURRENT ASSETS: | ||||||
Cash and cash equivalents | $ | 30,024,372 | $ | 6,137,689 | ||
Restricted cash | 819,269 | 785,806 | ||||
Accounts receivable | 320,848 | 1,247,059 | ||||
Deferred offering costs | — | 895,567 | ||||
Prepaid expenses and other current assets | 465,650 | 494,476 | ||||
Total Current Assets | 31,630,139 | 9,560,597 | ||||
NON-CURRENT ASSETS: | ||||||
Note receivable | 7,500,000 | — | ||||
Interest receivable | 113,014 | — | ||||
Property and equipment, net | 11,265 | 15,097 | ||||
Intangible assets, net | 147,538 | 160,219 | ||||
Right-of-use assets, operating leases, net | 760,229 | 317,141 | ||||
Other non-current assets | 188,281 | 7,419 | ||||
Total Non-current Assets | 8,720,327 | 499,876 | ||||
Total Assets | $ | 40,350,466 | $ | 10,060,473 | ||
LIABILITIES AND EQUITY | ||||||
CURRENT LIABILITIES: | ||||||
Taxes payable | $ | 493,196 | $ | 548,630 | ||
Salary payable | 103,168 | 129,711 | ||||
Accrued liabilities and other payables | 95,664 | 180,394 | ||||
Due to related parties | 2,564 | 241,097 | ||||
Operating lease liabilities | 423,124 | 170,082 | ||||
Operating lease liabilities - related party | — | 18,737 | ||||
Total Current Liabilities | 1,117,716 | 1,288,651 | ||||
NON-CURRENT LIABILITIES: | ||||||
Operating lease liabilities - noncurrent portion | 237,848 | 123,404 | ||||
Operating lease liabilities - related party - noncurrent portion | — | 9,705 | ||||
Total Non-current Liabilities | 237,848 | 133,109 | ||||
Total Liabilities | 1,355,564 | 1,421,760 | ||||
Commitments and Contingencies - (Note 17) | ||||||
EQUITY: | ||||||
TIAN RUIXIANG Holdings Ltd Shareholders' Equity: | ||||||
Ordinary shares: | ||||||
Class A ordinary shares: | 10,100 | 3,750 | ||||
Class B ordinary shares: | 1,250 | 1,250 | ||||
Additional paid-in capital | 39,776,761 | 7,696,468 | ||||
(Accumulated deficit) retained earnings | (1,090,060) | 884,076 | ||||
Statutory reserve | 199,653 | 170,066 | ||||
Accumulated other comprehensive income (loss) | 96,709 | (117,392) | ||||
Total TIAN RUIXIANG Holdings Ltd shareholders' equity | 38,994,413 | 8,638,218 | ||||
Non-controlling interest | 489 | 495 | ||||
Total Equity | 38,994,902 | 8,638,713 | ||||
Total Liabilities and Equity | $ | 40,350,466 | $ | 10,060,473 | ||
TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES | |||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME | |||||||||
(IN U.S. DOLLARS) | |||||||||
For the Years Ended October 31, | |||||||||
2021 | 2020 | 2019 | |||||||
REVENUES | |||||||||
Commissions | $ | 2,675,611 | $ | 2,954,798 | $ | 2,002,217 | |||
Risk management services | 115,006 | 294,546 | — | ||||||
Total Revenues | 2,790,617 | 3,249,344 | 2,002,217 | ||||||
OPERATING EXPENSES | |||||||||
Selling and marketing | 2,516,368 | 1,519,783 | 773,650 | ||||||
Selling and marketing - related parties | 1,129 | 38,426 | 23,922 | ||||||
General and administrative - professional fees | 1,011,053 | 94,363 | 123,512 | ||||||
General and administrative - compensation and related benefits | 948,900 | 743,062 | 651,490 | ||||||
General and administrative - related parties | 20,391 | 14,215 | 19,180 | ||||||
General and administrative - other | 546,580 | 279,353 | 307,793 | ||||||
Total Operating Expenses | 5,044,421 | 2,689,202 | 1,899,547 | ||||||
(LOSS) INCOME FROM OPERATIONS | (2,253,804) | 560,142 | 102,670 | ||||||
OTHER INCOME (EXPENSE) | |||||||||
Interest income | 315,070 | 88,948 | 275,168 | ||||||
Interest income - related party | — | 102,074 | — | ||||||
Interest expense | (725) | — | (18,218) | ||||||
Interest expense - related parties | — | — | (613) | ||||||
Other income | 19,411 | 8,991 | 54,988 | ||||||
Total Other Income, net | 333,756 | 200,013 | 311,325 | ||||||
(LOSS) INCOME BEFORE INCOME TAXES | (1,920,048) | 760,155 | 413,995 | ||||||
INCOME TAXES | 24,529 | 126,055 | 238,208 | ||||||
NET (LOSS) INCOME | $ | (1,944,577) | $ | 634,100 | $ | 175,787 | |||
LESS: NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST | (28) | (3) | — | ||||||
NET (LOSS) INCOME ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD ORDINARY | $ | (1,944,549) | $ | 634,103 | $ | 175,787 | |||
COMPREHENSIVE (LOSS) INCOME: | |||||||||
NET (LOSS) INCOME | (1,944,577) | 634,100 | 175,787 | ||||||
OTHER COMPREHENSIVE INCOME (LOSS) | |||||||||
Unrealized foreign currency translation gain (loss) | 214,123 | 420,719 | (70,429) | ||||||
COMPREHENSIVE (LOSS) INCOME | $ | (1,730,454) | $ | 1,054,819 | $ | 105,358 | |||
LESS: COMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO NON-CONTROLLING | (6) | 21 | (4) | ||||||
COMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD | $ | (1,730,448) | $ | 1,054,798 | $ | 105,362 | |||
NET (LOSS) INCOME PER ORDINARY SHARE ATTRIBUTABLE TO TIAN RUIXIANG | |||||||||
Basic and diluted * | $ | (0.23) | $ | 0.13 | $ | 0.04 | |||
WEIGHTED AVERAGE ORDINARY SHARES OUTSTANDING: | |||||||||
Basic and diluted * | 8,610,615 | 5,000,000 | 5,000,000 | ||||||
* The shares and per share amounts are presented on a retroactive basis. | |||||||||
TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES | |||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||
(IN U.S. DOLLARS) | |||||||||
For the Years Ended October 31, | |||||||||
2021 | 2020 | 2019 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||
Net (loss) income | $ | (1,944,577) | $ | 634,100 | $ | 175,787 | |||
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | |||||||||
Depreciation expense and amortization of intangible assets | 27,447 | 27,829 | 34,713 | ||||||
Amortization of right-of-use assets | 227,661 | 199,709 | — | ||||||
Impair loss | 696 | — | — | ||||||
Changes in operating assets and liabilities: | |||||||||
Accounts receivable | 969,374 | (1,021,727) | 91,432 | ||||||
Security deposit | (43,750) | 2,837 | (3,963) | ||||||
Prepaid expenses and other current assets | (74,120) | (8,582) | (356,117) | ||||||
Interest receivable | (113,014) | — | 16,745 | ||||||
Due from related parties | — | — | 447,778 | ||||||
Insurance premiums payable | — | — | (198,717) | ||||||
Taxes payable | (78,932) | 204,532 | (56,272) | ||||||
Accrued liabilities and other payables | (123,052) | 108,765 | 40,826 | ||||||
Due to related parties | 12,025 | (6,970) | 36,841 | ||||||
Operating lease liabilities - related party | (29,355) | (25,834) | — | ||||||
Operating lease liabilities | (194,341) | (162,828) | — | ||||||
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES | (1,363,938) | (48,169) | 229,053 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||
Purchase of property and equipment | (3,411) | (3,457) | (12,012) | ||||||
Purchase of intangible asset | — | — | (183,115) | ||||||
Investment in note receivable | (7,500,000) | — | — | ||||||
Payments of notes receivable - related party | — | (17,158,967) | — | ||||||
Proceed received from repayments of notes receivable - related party | — | 17,158,967 | 232,133 | ||||||
NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES | (7,503,411) | (3,457) | 37,006 | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||
Proceeds received from note payable | 75,581 | — | — | ||||||
Repayment of note payable | (75,581) | — | — | ||||||
Repayments made for borrowings | — | — | (369,483) | ||||||
Proceeds received from related parties' borrowings | 1,893,932 | 1,987,256 | — | ||||||
Repayments made for related parties' borrowings | (2,272,145) | (2,099,420) | (8,400) | ||||||
Proceeds received from initial public offering | 12,300,000 | — | — | ||||||
Disbursements for initial public offering costs | (1,489,388) | — | — | ||||||
Proceeds received from the June 2021 public offering | 24,562,500 | — | — | ||||||
Disbursements for the June 2021 public offering costs | (2,352,418) | (371,081) | (493,899) | ||||||
Capital contribution from shareholders | — | 5,000 | 464 | ||||||
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 32,642,481 | (478,245) | (871,318) | ||||||
EFFECT OF EXCHANGE RATE ON CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 145,014 | 486,780 | (55,593) | ||||||
NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 23,920,146 | (43,091) | (660,852) | ||||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH - beginning of year | 6,923,495 | 6,966,586 | 7,627,438 | ||||||
CASH, CASH EQUIVALENTS AND RESTRICTED CASH - end of year | $ | 30,843,641 | $ | 6,923,495 | $ | 6,966,586 | |||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | |||||||||
Cash paid for: | |||||||||
Interest | $ | 725 | $ | — | $ | 33,675 | |||
Income taxes | $ | 2,251 | $ | — | $ | 283,267 | |||
NON-CASH INVESTING AND FINANCING ACTIVITIES | |||||||||
Payments made by related parties on the Company's behalf | $ | 119,886 | $ | 141,449 | $ | — | |||
RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH | |||||||||
Cash and cash equivalents at beginning of year | $ | 6,137,689 | $ | 6,243,029 | $ | 6,712,880 | |||
Restricted cash at beginning of year | 785,806 | 723,557 | 914,558 | ||||||
Total cash, cash equivalents and restricted cash at beginning of year | $ | 6,923,495 | $ | 6,966,586 | $ | 7,627,438 | |||
Cash and cash equivalents at end of year | $ | 30,024,372 | $ | 6,137,689 | $ | 6,243,029 | |||
Restricted cash at end of year | 819,269 | 785,806 | 723,557 | ||||||
Total cash, cash equivalents and restricted cash at end of year | $ | 30,843,641 | $ | 6,923,495 | $ | 6,966,586 | |||
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SOURCE TIAN RUIXIANG Holdings Ltd
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