UNITED STATES SECURITIES AND EXCHANGE COMMISSION
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
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Recent Developments — NYSE Delisting and Going Concern Uncertainty
On October 13, 2025, the Company received a determination notice from the NYSE stating its intent to commence proceedings to delist our common stock. Trading was suspended immediately. This event has a material impact on our financial condition and raises substantial doubt about our ability to continue as a going concern. The following discussion and analysis should be read with this critical uncertainty in mind.
Overview
We are engaged in the research, development, production, and sale of various types of fertilizers, agricultural products and Bitcoin in the PRC and United States through our wholly owned subsidiaries. Our primary business is fertilizer products, specifically humic-acid based compound fertilizer and other types of fertilizers. We also produce and sell agricultural products such as top-grade fruits, vegetables, flowers, and colored seedlings, and engage in the mining of digital assets Bitcoin.
For financial reporting purposes, our operations are organized into four business segments: fertilizer products (Jinong), fertilizer products (Gufeng), agricultural products (Yuxing), and Bitcoin (Antaeus). The fertilizer business generated approximately 86.8% and 88.8% of our total revenues for the years ended June 30, 2025 and 2024, respectively. Yuxing generated 13.0% and 9.8% of our revenues, while Antaeus generated 0.2% and 1.3% for the same periods.
Fertilizer Products
As of June 30, 2025, we had developed, produced, and sold a total of 111 different fertilizer products, of which 73 were developed and produced by Jinong and 38 by Gufeng.
The table below shows the metric tons of fertilizer sold by Jinong and Gufeng and the revenue per ton for the periods indicated:
| Year Ended June 30 | Change 2024 to 2025 | |
|---|---|---|
| 2025 | 2024 | |
| (Metric tons) | ||
| Jinong | 39,304 | 33,474 |
| Gufeng | 74,197 | 105,597 |
| Total | 113,501 | 139,070 |
| | Year Ended June 30 |
| 2025 | 2024 | |
| (Revenue per ton) | ||
| Jinong | $746 | $983 |
| Gufeng | $496 | $491 |
Our sales of fertilizer products to five provinces accounted for approximately 65.2% of our manufactured fertilizer revenue for the year ended June 30, 2025. As of June 30, 2025, we had a total of 639 distributors covering 22 provinces, 4 autonomous regions and 4 central government-controlled municipalities in China.
Agricultural Products
Through Yuxing, we develop, produce, and sell high-quality flowers, green vegetables and fruits to local marketplaces and various horticulture and planting companies. The three PRC provinces that accounted for 89.1% of our agricultural products revenue for the fiscal year ended June 30, 2025 were Shaanxi (81.9%), Beijing (4.7%), and Shanghai (2.5%).
Digital Assets Bitcoin
In March 2023, we purchased digital assets mining machines and established Antaeus Tech Inc. (“Antaeus”) in the State of Texas to mine digital assets Bitcoin.
Recent Developments
During the three months ending June 30, 2025, Jinong discontinued 8 obsolete products and terminated 2 unqualified distributors. Gufeng did not introduce any new fertilizer products or onboard new distributors.
Results of Operations
Fiscal Year ended June 30, 2025 Compared to the Year ended June 30, 2024.
| 2025 | 2024 | Change $ | Change % | |
|---|---|---|---|---|
| Sales | ||||
| Jinong | $28,803,021 | $32,954,490 | $(4,151,469) | -12.6% |
| Gufeng | $36,549,551 | $52,189,666 | $(15,640,115) | -30.0% |
| Yuxing | $9,750,553 | $9,416,451 | $334,102 | 3.5% |
| Antaeus | $181,746 | $1,285,181 | $(1,103,435) | -85.9% |
| Net sales | $75,284,871 | $95,845,788 | $(20,560,917) | -21.5% |
| Cost of goods sold | ||||
| Jinong | $17,934,458 | $21,778,141 | $(3,843,683) | -17.6% |
| Gufeng | $31,967,249 | $45,600,383 | $(13,633,134) | -29.9% |
| Yuxing | $8,057,609 | $7,816,566 | $241,043 | 3.1% |
| Antaeus | $215,773 | $928,718 | $(712,945) | -76.8% |
| Cost of goods sold | $58,175,089 | $76,123,808 | $(17,948,719) | -23.6% |
| Gross profit | $17,109,782 | $19,721,980 | $(2,612,198) | -13.2% |
| Operating expenses | ||||
| Selling expenses | $7,434,325 | $7,790,881 | $(356,556) | -4.6% |
| General and administrative expenses | $24,430,435 | $40,779,553 | $(16,349,119) | -40.1% |
| Change in fair value of Bitcoin | $- | $2,701 | $(2,701) | -100% |
| Total operating expenses | $31,864,760 | $48,573,135 | $(16,708,376) | -34.4% |
| Loss from operations | $(14,754,978) | $(28,851,155) | $14,096,178 | -48.9% |
| Other income (expense) | ||||
| Other income (expense) | $(553,312) | $132,974 | $(686,286) | -516.1% |
| Interest income | $126,918 | $194,401 | $(67,483) | -34.7% |
| Interest expense | $(470,623) | $(292,186) | $(178,437) | 61.1% |
| Total other income (expense) | $(897,017) | $35,189 | $(932,206) | -2649.1% |
| Loss before income taxes | $(15,651,995) | $(28,815,966) | $13,163,971 | -45.7% |
| Provision for income taxes | $(49,835) | $(410,651) | $360,816 | -87.9% |
| Net loss | $(15,602,160) | $(28,405,315) | $12,803,155 | -45.1% |
| Other comprehensive (loss) income | ||||
| Foreign currency translation (loss) gain | $(1,461,004) | $399,957 | $(1,860,961) | -465.3% |
| Comprehensive loss | $(17,063,164) | $(28,005,358) | $10,942,194 | -39.1% |
| Basic weighted average shares outstanding | 14,897,067 | 13,936,757 | 960,311 | 6.9% |
| Basic net loss per share | $(1.05) | $(2.04) | $0.99 | -48.6% |
| Diluted weighted average shares outstanding | 14,897,067 | 13,936,757 | 960,311 | 6.9% |
| Diluted net loss per share | $(1.05) | $(2.04) | $0.99 | -48.6% |
Net Sales
Total net sales for the fiscal year ended June 30, 2025 were $75,284,871, a decrease of $20,560,917 or 21.5%, from $95,845,788 for the fiscal year ended June 30, 2024. This decrease was principally due to Gufeng’s lower sales.
Jinong’s net sales decreased by $4,151,469, or 12.6%, to $28,803,021 from $32,954,490 for the fiscal year ended June 30, 2024, mainly due to the reduction in unit price. Jinong sold 39,304 tons of product during fiscal year 2025, an increase of 5,831 tons or 17.4% compared to 33,474 tons in fiscal year 2024. However, the revenue per ton was only $746, a decrease of $237 or 24.1% compared to $983 for the fiscal year ended June 30, 2024.
Gufeng’s net sales were $36,549,551, a decrease of $15,640,115, or 30.0% from $52,189,666, for the fiscal year ended June 30, 2024, primarily due to reduced sales volume.
Yuxing’s net sales were $9,750,553, an increase of $334,102, or 3.5%, from $9,416,451 for the fiscal year ended June 30, 2024, mainly attributable to the increase in market demand.
Antaeus’s net sales were $181,746, a decrease of $1,103,435, or 85.9%, from $1,285,181 for the fiscal year ended June 30, 2024, due to the Company’s strategic shift.
Cost of Goods Sold
The total cost of goods sold for the fiscal year ended June 30, 2025 was $58,175,089, a decrease of $17,948,719, or 23.6%, from $76,123,808 for the fiscal year ended June 30, 2024, primarily due to lower net sales.
Gross Profit
Total gross profit for the fiscal year ended June 30, 2025 decreased by $2,612,198 to $17,109,782, as compared to $19,721,980 for the fiscal year ended June 30, 2024. Gross profit margin was 22.7% and 20.6% for the fiscal years ended June 30, 2025 and 2024, respectively.
Selling Expenses
Selling expenses were $7,434,325, or 9.9%, of net sales for the fiscal year ended June 30, 2025, as compared to $7,790,881, or 8.1%, of net sales, for the fiscal year ended June 30, 2024, a decrease of $356,556, or 4.6%.
General and Administrative Expenses
General and administrative expenses were $24,430,435, or 32.5% of net sales for the fiscal year ended June 30, 2025, as compared to $40,779,553, or 42.5%, of net sales for the fiscal year ended June 30, 2024, a decrease of $16,349,119, or 40.1%. The decrease was mainly due to lower bad debts expense.
Total Other Income (Expenses)
Total other expense for the fiscal year ended June 30, 2025 was $897,017, as compared to the total other income of $35,189 for the fiscal year ended June 30, 2024, a decrease of $932,206, or 2649.1%. The decrease mainly resulted from higher non-operating expense and higher bank charge in fiscal year 2025.
Income Taxes
Jinong is subject to a preferred tax rate of 15% and has no income tax expense for the fiscal years ended June 30, 2025 and 2024. Gufeng is subject to a tax rate of 25% and has no income tax expense for the fiscal years ended June 30, 2025 and 2024. Yuxing is exempt from income tax. Antaeus is subject to a tax rate of 21% and has income tax expense of $(49,835) and $(410,651) for the fiscal years ended June 30, 2025 and 2024, respectively.
Net loss
Net loss for the fiscal year ended June 30, 2025 was $(15,602,160), a decrease of loss with amount of $12,803,155, or 45.1%, compared to $(28,405,315), for the fiscal year ended June 30, 2024. The decrease was mainly due to lower General and administrative expenses.
Discussion of Segment Profitability Measures
For Jinong, net loss increased by $5,627,748 or 188.6% to $(8,611,147) for the year ended June 30, 2025, from $(2,983,399) for the fiscal year ended June 30, 2024, due to higher general and administrative expenses.
For Gufeng, net loss decreased by $15,756,585 or 82.0% to $(3,462,990) for the year ended June 30, 2025 from $(19,219,575) for year ended June 30, 2024, primarily due to the decrease in general and administrative expenses.
For Yuxing, net loss decreased 174.9%, by $1,403,770, to net income of $601,195 for the year ended June 30, 2025 from $(802,575) for year ended June 30, 2024, mainly due to lower general and administrative expenses.
For Antaeus, the net loss decreased by $1,357,357 or 87.9% to $(187,474) for the year ended June 30, 2025 from $(1,544,831) for year ended June 30, 2024.
Liquidity and Capital Resources
The Company has historically funded operations through cash flows from operations and financing activities. However, the NYSE’s decision to delist our common stock raises substantial doubt about our ability to continue as a going concern. Management is currently evaluating options to mitigate the potential negative effects, including the potential need for additional financing.
As of June 30, 2025, cash and cash equivalents were $52,519,418, a decrease of $6,253,169, or 10.6%, from $58,772,587 as of June 30, 2024.
The following table sets forth a summary of our cash flow for the periods indicated:
| | Year Ended June 30 |
| 2025 | 2024 | |
| Net cash used in operating activities | $(2,561,222) | $(9,872,781) |
| Net cash used in investing activities | $(5,754,622) | $(6,102,903) |
| Net cash provided by financing activities | $3,185,474 | $3,274,064 |
| Effect of exchange rate change on cash and cash equivalents | $(1,122,799) | $332,020 |
| Net decrease in cash and cash equivalents | $(6,253,169) | $(12,369,600) |
| Cash and cash equivalents - beginning balance | $58,772,587 | $71,142,188 |
| Cash and cash equivalents - ending balance | $52,519,418 | $58,772,587 |
As of June 30, 2025, our loans payable was $12,610,561, including $4,720,934 in short-term loans and $7,889,627 in long-term loans.
We had accounts receivable of $19,345,061 as of June 30, 2025, an increase of $2,851,993 or 17.3% from June 30, 2024. The allowance for doubtful accounts was $30,266,093, or 61.0% of accounts receivable, as of June 30, 2025.
We had inventories of $36,975,287 as of June 30, 2025, a decrease of $851,169, or 2.3%, from June 30, 2024. Advances to suppliers were $12,367,419 as of June 30, 2025, an increase of $257,385, or 2.1%, from June 30, 2024.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements.
Critical Accounting Policies and Estimates
Our financial statements reflect the selection and application of accounting policies which require management to make significant estimates and judg