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What changed in Maison Solutions Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Maison Solutions Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+215 added−159 removedSource: 10-K (2025-08-14) vs 10-K (2024-08-13)

Top changes in Maison Solutions Inc.'s 2025 10-K

215 paragraphs added · 159 removed · 132 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

18 edited+23 added−5 removed176 unchanged
Biggest changeWe have never experienced a strike or significant work stoppage. We consider our employee relations to be good. Minimum wage rates in some states have recently increased. For example, in Los Angeles, the minimum wage rose from $13 to $14 per hour from 2020 to 2021 and increased to $15.50 per hour in 2023.
Biggest changeWe have never experienced a strike or significant work stoppage. We consider our employee relations to be good. Minimum wage rates in some states have recently increased.
Our flexible shopping options are aimed to provide customers with convenience and flexibility that best match their lifestyles and personal preferences. Currently JD.com is developing a new mobile app for our future stores. For more information, please see “ Partnership with JD.com ” below. 12 Pricing Strategy In general, our pricing strategy is to provide premium products at reasonable prices.
Our flexible shopping options are aimed to provide customers with convenience and flexibility that best match their lifestyles and personal preferences. 12 Currently JD.com is developing a new mobile app for our future stores. For more information, please see “ Partnership with JD.com ” below. Pricing Strategy In general, our pricing strategy is to provide premium products at reasonable prices.
Since our formation in July 2019, we have acquired equity interests in four traditional Asian supermarkets in Los Angeles, California and three traditional Asian supermarkets in the greater Phoenix and Tucson, Arizona metro areas.
Since our formation in July 2019, we have acquired equity interests in three traditional Asian supermarkets in Los Angeles, California and three traditional Asian supermarkets in the greater Phoenix and Tucson, Arizona metro areas.
Our Multi-Channel and Consumer Coverage 16 Partnership with JD.com In April 2021, we entered into a series of agreements with JD E-commerce America Limited (“JD US”), the U.S. subsidiary of JD.com, including the Collaboration Agreement and Intellectual Property License Agreement (each as further described below).
Our Multi-Channel and Consumer Coverage 16 Partnership with JD.com In April 2021, we entered into a series of agreements with JD E-commerce America Limited (“JD US”), the U.S. subsidiary of JD.com, Inc (“JD.com”), including the Collaboration Agreement and Intellectual Property License Agreement (each as further described below).
We have been operating these seven supermarkets as center stores, which we define as a full service store, similar to a traditional supermarket or grocery store covering a metro area, but with its own storage space to be used as a warehouse to distribute products to the satellite stores.
We have been operating these six supermarkets as center stores, which we define as a full service store, similar to a traditional supermarket or grocery store covering a metro area, but with its own storage space to be used as a warehouse to distribute products to the satellite stores.
Immediately upon formation, the Company acquired three retail Asian supermarkets in Los Angeles, California and subsequently rebranded them as “HK Good Fortune Supermarkets” or “Hong Kong Supermarkets.” In September 2021, the Company was reincorporated in the State of Delaware as a corporation registered under the laws of the State of Delaware and renamed “Maison Solutions Inc.” ● In July 2019, the Company acquired 91% of the equity interests in Maison San Gabriel and 85.25% of the equity interests in Maison Monrovia, each of which owns a HK Good Fortune Supermarket in San Gabriel, California and Monrovia, California, respectively. ● In October 2019, the Company acquired 91.67% of the equity interests in Maison El Monte, which owns a Hong Kong Supermarket in El Monte, California. ● In May 2021, the Company acquired 10% of the equity interests in Dai Cheong Trading Company, Inc.
Immediately upon formation, the Company acquired three retail Asian supermarkets in Los Angeles, California and subsequently rebranded them as “HK Good Fortune Supermarkets” or “Hong Kong Supermarkets.” In September 2021, the Company was reincorporated in the State of Delaware as a corporation registered under the laws of the State of Delaware and renamed “Maison Solutions Inc.” ● In July 2019, the Company acquired 91% of the equity interests in Maison San Gabriel and 85.25% of the equity interests in Maison Monrovia, each of which owns a HK Good Fortune Supermarket in San Gabriel, California and Monrovia, California, respectively. ● In October 2019, the Company acquired 91.67% of the equity interests in Maison El Monte, which owns a Hong Kong Supermarket in El Monte, California.
In collaboration with our suppliers and distribution agents we consistently monitor social media and assess store data to identify and subsequently offer products which are popular with our target consumers. Employees As of April 30, 2024, we had approximately 355 employees. Our employees are not unionized nor, to our knowledge, are there any plans for them to unionize.
In collaboration with our suppliers and distribution agents we consistently monitor social media and assess store data to identify and subsequently offer products which are popular with our target consumers. Employees As of April 30, 2025, we had approximately 378 employees. Our employees are not unionized nor, to our knowledge, are there any plans for them to unionize.
Additionally, the SEC maintains a website located at www.sec.gov that contains the information we file or furnish electronically with the SEC. 20
Additionally, the SEC maintains a website located at www.sec.gov that contains the information we file or furnish electronically with the SEC. 21
In the fiscal years ended on April 30, 2024 and 2023, the non-perishable grocery category contributed approximately 45.97% and 43.52%, respectively, to our total net sales and realized a markup of 35.13% and 35.09%, on average, respectively. 10 The Alhambra Store In December 2021, we acquired a 10% equity interest in a new grocery store in Alhambra, California from Grace Xu, spouse of John Xu, our chief executive officer (the “Alhambra Store”).
In the fiscal years ended on April 30, 2025 and 2024, the non-perishable grocery category contributed approximately 48.40 and 45.97%, respectively, to our total net sales and realized a markup of 35.13% and 35.09%, on average, respectively. 10 The Alhambra Store In December 2021, we acquired a 10% equity interest in a new grocery store in Alhambra, California from Grace Xu, spouse of John Xu, our chief executive officer (the “Alhambra Store”).
Having an importer as a part of our portfolio allows us the opportunity to offer a wider variety of products and to reap the benefits of preferred wholesale pricing We work with three primary suppliers. These primary suppliers accounted for approximately 48.0% and 51.5% of our total purchases in fiscal years 2024 and 2023, respectively.
Having an importer as a part of our portfolio allows us the opportunity to offer a wider variety of products and to reap the benefits of preferred wholesale pricing We work with three primary suppliers. These primary suppliers accounted for approximately 19.0% and 48.0% of our total purchases in fiscal years 2025 and 2024, respectively.
Our payroll and payroll tax expenses were $7.4 million and $6.2 million for the year ended April 30, 2024 and 2023, respectively. Our Growth Strategy Continue Building Center Satellite Stores Network Operation of Center Stores — We have a successful record of operating our existing retail supermarkets and have been able to quickly turn distressed stores into profitable assets.
Our payroll and payroll tax expenses were $15.0 million and $7.4 million for the year ended April 30, 2025 and 2024, respectively. Our Growth Strategy Continue Building Center Satellite Stores Network Operation of Center Stores — We have a successful record of operating our existing retail supermarkets and have been able to quickly turn distressed stores into profitable assets.
In fiscal years 2024 and 2023, our perishable product categories contributed approximately 54.0% and 56.5%, respectively, to our total net revenue in alignment with the space occupancy of perishables. ● Vegetables — All our stores receive daily deliveries of vegetables and are required to sell out all vegetables on a three to five day basis.
In fiscal years 2025 and 2024, our perishable product categories contributed approximately 50% and 54%, respectively, to our total net revenue in alignment with the space occupancy of perishables. ● Vegetables — All our stores receive daily deliveries of vegetables and are required to sell out all vegetables on a three to five day basis.
With Maison’s mature retail network and the fast-growing customer base in the United States, more overseas boutique products are expected to be imported to the United States for the benefit of American consumers. 17 Collaboration Agreement On April 19, 2021, JD E-commerce America Limited (“JD US”), the U.S. subsidiary of JD.com, and Maison entered into a Collaboration Agreement (the “Collaboration Agreement”).
With Maison’s mature retail network and the fast-growing customer base in the United States, more overseas boutique products are expected to be imported to the United States for the benefit of American consumers. 17 Collaboration Agreement On April 19, 2021, JD US, the U.S. subsidiary of JD.com, and Maison entered into a Collaboration Agreement (the “Collaboration Agreement”).
Our business is also marketed mainly on our official website, a third-party Mobile App “Freshdeals24”, and an applet integrated into WeChat. For the fiscal years ended April 30, 2024 and 2023, we recognized $208,000 and $73,678 for marketing and advertising expenses, respectively.
Our business is also marketed mainly on our official website, a third-party Mobile App “Freshdeals24”, and an applet integrated into WeChat. For the fiscal years ended April 30, 2025 and 2024, we recognized $79,360 and $208,000 for marketing and advertising expenses, respectively.
Maison has seven retail supermarkets in San Gabriel, California, Monrovia, California, El Monte, California, Monterey Park, California, Chandler, Arizona, Peoria, Arizona and Tucson, Arizona.
Maison has six retail supermarkets in San Gabriel, California, Monrovia, California, Monterey Park, California, Chandler, Arizona, Peoria, Arizona and Tucson, Arizona.
With four retail supermarkets located in San Gabriel, Monrovia, El Monte and Monterey Park, in the Los Angeles, California metropolitan area, and three retail supermarkets located in the Phoenix and Tucson, Arizona metro areas, we had over 1.79 million annual transactions in the year ended April 30, 2024.
With three retail supermarkets located in San Gabriel, Monrovia and Monterey Park, in the Los Angeles, California metropolitan area, and three retail supermarkets located in the Phoenix and Tucson, Arizona metro areas, we had over 3.8 million annual transactions in the year ended April 30, 2025.
We are a “smaller reporting company” as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended, or (the “Exchange Act”), and have elected to take advantage of certain aspects of the scaled disclosure available for smaller reporting companies. Available Information Our Internet website is www.maisonsolutionsinc.com .
We are a “smaller reporting company” as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended, or (the “Exchange Act”), and have elected to take advantage of certain aspects of the scaled disclosure available for smaller reporting companies. Information About Our Executive Officers Set forth below is information concerning our current executive officers and directors.
For more information on the Lee Lee Acquisition, please see Note 10 — “ Note Payable ” and Note 18 — “ Acquisition of subsidiary ” in the Notes to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K. 11 Store Renovation Program From time to time, we conduct maintenance and rennovations on our stores to enhance customer shopping experiences and optimize store designs.
For more information on the Lee Lee Acquisition, please see Note 10 — “ Note Payable ” and Note 19 — “ Acquisition of subsidiary ” in the Notes to the Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K. 11 Our Vertical Supply and Distribution Chain Our business model features a vertically integrated structure covering upstream supply and downstream retail supermarkets.
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Because our acquisition of Lee Lee (as defined below) was completed on April 8, 2024, shortly before our fiscal year-end, the description of our business throughout this Item 1 does not include a description of Lee Lee unless specifically referenced herein.
Added
The Company shut down the Maison El Monte store in June 2025. The strategic decision to close Maison El Monte store is part of the Company’s ongoing commitment to improve its profitability and support sustainable growth. ● In May 2021, the Company acquired 10% of the equity interests in Dai Cheong Trading Company, Inc.
Removed
In January 2024, we began renovating our HK Good Fortune supermarket in El Monte, California. The renovations to the El Monte store include exterior and interior upgrades as well as product offering adjustments. Additionally, the store will use updated logos and banners, which will be used throughout Maison’s store network, for enhanced brand awareness and consistency.
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For example, in Los Angeles, the minimum wage rose from $14 per hour from 2021 to $15.50 per hour in 2023 and increased to $16 per hour starting from January 1, 2024; in Arizona, the minimum wage was $13.85 per hour in 2023, and increased to $14.35 per hour starting from January 1, 2024.
Removed
We plan to leverage and deploy our recently purchased software suite for the optimization of store design, layout and shelf display. The software system will also monitor shelf performance to better analyze the popularity and pricing of the store's product offerings.
Added
Name Age Position(s) John Xu 48 President and Chief Executive Officer and Chairman of the Board Alexandria M. Lopez 40 Chief Financial Officer and Director Mark Willis 68 Director Bin Wang 67 Director Dr. Xiaoxia Zhang 55 Director Tao Han 51 Chief Operating Officer There are no family relationships between our executive officers and members of our Board.
Removed
Once the renovations are complete, the El Monte store also will serve as a warehouse-like store with discounts for large and bulk purchases, which we believe will further improve the store's performance. The El Monte store has remained open for business during these renovations, which are expected to be completed by the end of 2024.
Added
Backgrounds of Current Executive Officers and Directors Set forth below is information concerning our current executive officers and directors identified above. John Xu has served as Director, President and Chief Executive Officer of the Company since 2019. Mr. Xu has served as Director and President of J&C International Group LLC, a cross-border investment firm since 2013.
Removed
We intend to continue to upgrade our stores to provide a more meaningful shopping experience for our customers. Our Vertical Supply and Distribution Chain Our business model features a vertically integrated structure covering upstream supply and downstream retail supermarkets.
Added
From 2009 to 2020, Mr. Xu also served as Director and President of Ideal City Realty, LLC, a real estate investment firm. Mr. Xu has extensive experience in business operations, investment and strategic management and retail enterprises, with a keen market sense and deep understanding of cross-border investment environment. We believe Mr.
Added
Xu’s qualifications to serve on our board of directors include his perspective and experience building and leading our Company as the founder and Chief Executive Officer and his extensive experience in business, strategic development and implementation. 20 Alexandria M.
Added
Lopez has served as a member of our board of directors and has been the Chief Financial Officer of the Company since 2019. Ms. Lopez previously served as Chief Financial Officer and Vice President of J&C International Group LLC, a position she has held from 2014 to 2023. Ms. Lopez has over 10 years of financial and accounting experience. Ms.
Added
Lopez received a B.A. in Accounting from the University of Phoenix. We believe Ms. Lopez’s qualifications to serve on our board of directors include her knowledge of our Company and her extensive management experience at our Company. Mark Willis has served as a member of our board of directors since June 2023. Mr.
Added
Willis is the founder and Chief Executive Officer of ParQuest Consulting, which he founded in 2015. Mr. Willis previously served as a member of the transition team of New York City Mayor Eric Adams from 2021 to 2022. Prior to these roles, Mr. Willis served in various roles at Morgan Stanley Wealth Management, from 1998 to 2015. Mr.
Added
Willis has a BBA in Finance and Investments from Baruch College and an MBA with a concentration computer methodology from the Baruch College Graduate School of Business. We believe Mr. Willis’s qualifications to serve on our board of directors include his substantial experience in business management and finance as well as his expertise and resources in financial services.
Added
Bin Wang has served as a member of our board of directors since June 2023. Mr. Wang is the Managing Director of Eon Capital International Ltd, a Hong Kong-incorporated corporate advisory service company since 2007. Mr. Wang also serves as a member of the board of directors of Fly-E Group, Inc. (NASDAQ: FLYE) since May 2024.
Added
He also acted as the Chairman and Chief Executive Officer of Alberton Acquisition Corp. (ALAC), a NASDAQ listed company from 2018 to 2020. From 2010 to 2012, he served as Independent Board Director of Sky Digital Stores Corp. (SKYC), participating in the company’s a public listing process. Mr.
Added
Wang began his financial career in 1994 with Chemical Bank, as market segment manager for developing the bank’s commercial banking business in the US domestic Asian market. He then served as Vice President and Team Leader of Chase International Financial Services after Chemical Bank’s merger into Chase in 1996 and later combination into JP Morgan Chase in 2000.
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He continued his service at JP Morgan Chase with a broad range of management responsibilities in the development and growth of the bank’s international business until 2006. Mr.
Added
Wang graduated from Northwestern Polytechnic University in 1980, received his M.S. degree in Mechanical Engineering from Xi’an Jiaotong University in 1983 and he obtained his M.A. in economics from Illinois State University in 1992. Mr.
Added
Wang has over 30 years of management experience in financial industry and has provided his financial advisory services to dozens of corporate clients in both the United States and Asia. We believe Mr. Wang’s qualifications to serve on our board of directors include his substantial experience in business management as well as his expertise and resources in financial services. Dr.
Added
Xiaoxia Zhang has served as a member of our board of directors since June 2023. Dr. Zhang serves as a consultant for a number of Chinese companies with U.S. operations, focusing on strategy, resourcing, technology and supply chain management.
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Her clients include Yangfang Shengli Catering, which she helped to grow from its origins as a street vendor to a full-industry-chain company that specializes in hala catering, food processing, packaging, central kitchen and restaurants, and to expand its footprint in the New York and California markets. Dr.
Added
Zhang also advises Shanxi Hongtong Fenghe Agroforestr, where she helped to develop its signature product, “Yulu Fragrant Pear”, which is known as the “King of Chinese Pears” and to streamline the company’s supply chain process, increasing company efficiency and profitability. Dr.
Added
Zhang also serves as Deputy Director at Renmin University of China Lifelong Learning Center, a position she has held since 2014. She previously served as Chairwoman at Zhongguancun Dongsheng New Urbanization Industry Alliance from 2016 to 2020 and Vice Dean at Tianjin Bohai Urban Development Research Institute from 2011 to 2021. Dr.
Added
Zhang received her Doctoral Degree in environment science from Peking University in 2004. We believe Dr. Zhang’s qualifications to serve on our board of directors include her substantial experience in consulting and supply chain management and development as well as her experience with growth stage companies. Tao Han has served as our Chief Operating Officer since October 2023.
Added
Since October 2020, Mr. Han has served as the general manager of our stores located in San Gabriel and Monrovia. Prior to 2020, Mr. Han has served various managerial positions in retail supermarkets for more than 10 years. From 2017 to 2020, Mr. Han was a marketing manager for Hema Fresh in Beijing. From 2011 to 2017, Mr.
Added
Han served as administrative manager of Yonghui Supermarket, a public retail company in China. From 2001 to 2011, he was the Head of Management of Iko-Yokato Beijing. Available Information Our Internet website is www.maisonsolutionsinc.com .

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

31 edited+0 added−0 removed299 unchanged
Biggest changePursuant to our Collaboration Agreement with JD US (the “Collaboration Agreement”), either party may terminate the Collaboration Agreement by giving notice in writing to the other party if the other party commits a material breach of agreement or the other party suffers an Insolvency Event (as defined in the Collaboration Agreement).
Biggest changePursuant to our Collaboration Agreement with JD US, either party may terminate the Collaboration Agreement by giving notice in writing to the other party if the other party commits a material breach of agreement or the other party suffers an Insolvency Event (as defined in the Collaboration Agreement).
The market price of our stock may be influenced by many factors, some of which are beyond our control, including those described above in “— Risks Related to Our Business ” and the following: ● actual or anticipated fluctuations in our quarterly or annual financial results; ● delays in, or our failure to provide, financial guidance; ● the financial guidance we may provide to the public, any changes in such guidance, or our failure to meet such guidance; ● the failure of securities analysts to cover our Class A common stock; ● changes in financial estimates by securities analysts; ● the inability to meet the financial estimates of analysts who follow our Class A common stock; ● strategic actions by us or our competitors; ● actual or anticipated growth rates relative to our competitors; ● various market factors or perceived market factors, including rumors, whether or not correct, involving us or our competitors; ● fluctuations in stock market prices and trading volumes of securities of similar companies; ● announcements by us or our competitors of significant contracts, acquisitions, joint marketing relationships, joint ventures or capital commitments; ● sales, or anticipated sales, of large blocks of our stock; ● short selling of our Class A common stock by investors; ● additions or departures of key personnel; ● new store openings or entry into new markets by us or by our competitors; ● regulatory or political developments; 34 ● changes in accounting principles or methodologies; ● litigation and governmental investigation; ● general financial market condition or events; ● economic, legal and regulatory factors unrelated to our performance; ● discussion of use or our stock price by the financial press and in online investor forum; ● variations in our quarterly operating results and those of our competitors; ● general economic and stock market conditions; ● risks related to our business and our industry, including those discussed above; ● changes in conditions or trends in our industry, markets or customers; ● terrorist acts; ● future sales of our Class A common stock or other securities; ● public evaluations of our business models and our revenues, earnings and growth potential; and ● investor perceptions of the investment opportunity associated with our Class A common stock relative to other investment alternatives.
The market price of our stock may be influenced by many factors, some of which are beyond our control, including those described above in “— Risks Related to Our Business ” and the following: ● actual or anticipated fluctuations in our quarterly or annual financial results; ● delays in, or our failure to provide, financial guidance; ● the financial guidance we may provide to the public, any changes in such guidance, or our failure to meet such guidance; ● the failure of securities analysts to cover our Class A common stock; ● changes in financial estimates by securities analysts; ● the inability to meet the financial estimates of analysts who follow our Class A common stock; ● strategic actions by us or our competitors; ● actual or anticipated growth rates relative to our competitors; ● various market factors or perceived market factors, including rumors, whether or not correct, involving us or our competitors; ● fluctuations in stock market prices and trading volumes of securities of similar companies; ● announcements by us or our competitors of significant contracts, acquisitions, joint marketing relationships, joint ventures or capital commitments; ● sales, or anticipated sales, of large blocks of our stock; ● short selling of our Class A common stock by investors; ● additions or departures of key personnel; ● new store openings or entry into new markets by us or by our competitors; ● regulatory or political developments; 35 ● changes in accounting principles or methodologies; ● litigation and governmental investigation; ● general financial market condition or events; ● economic, legal and regulatory factors unrelated to our performance; ● discussion of use or our stock price by the financial press and in online investor forum; ● variations in our quarterly operating results and those of our competitors; ● general economic and stock market conditions; ● risks related to our business and our industry, including those discussed above; ● changes in conditions or trends in our industry, markets or customers; ● terrorist acts; ● future sales of our Class A common stock or other securities; ● public evaluations of our business models and our revenues, earnings and growth potential; and ● investor perceptions of the investment opportunity associated with our Class A common stock relative to other investment alternatives.
Specifically, maintaining records for inbound warehouse purchases or have specialized personnel to scan goods into the warehouse on a timely basis; (iv) the lack of adequate policies and procedures in control environment and control activities to ensure that the Company’s policies and procedures have been carried out as planned; ;(v) information technology general control in the areas of: (1) Risk and Vulnerability Assessment; (2) Selection and Management/Monitoring of Critical Vendors; (3) System Development and Change Management; (4) Backup Management; (5) System Security & Access: Deficiency in the Area of Audit Trail Record Control, Password Management, Vulnerability Scanning or Penetration Testing; (6) Segregation of Duties, Privileged Access, and Monitoring Controls; and (7) System Monitoring and Incident Management; and (vi) accounting personnel have the ability in the accounting system to prepare, review, and post the same accounting journal entry. 40 Although we continue to remediate our material weakness, we may be unable to remediate it in a timely manner, or at all, and additional weaknesses in our disclosure controls and internal controls over financial reporting may be discovered in the future.
Specifically, maintaining records for inbound warehouse purchases or have specialized personnel to scan goods into the warehouse on a timely basis; (iv) the lack of adequate policies and procedures in control environment and control activities to ensure that the Company’s policies and procedures have been carried out as planned; ;(v) information technology general control in the areas of: (1) Risk and Vulnerability Assessment; (2) Selection and Management/Monitoring of Critical Vendors; (3) System Development and Change Management; (4) Backup Management; (5) System Security & Access: Deficiency in the Area of Audit Trail Record Control, Password Management, Vulnerability Scanning or Penetration Testing; (6) Segregation of Duties, Privileged Access, and Monitoring Controls; and (7) System Monitoring and Incident Management; and (vi) accounting personnel have the ability in the accounting system to prepare, review, and post the same accounting journal entry. 41 Although we continue to remediate our material weakness, we may be unable to remediate it in a timely manner, or at all, and additional weaknesses in our disclosure controls and internal controls over financial reporting may be discovered in the future.
Furthermore, Section 22 of the Securities Act provides for concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder, and as such, the exclusive jurisdiction clauses set forth above would not apply to such suits. 37 Although we believe the exclusive forum provision benefits us by providing increased consistency in the application of Delaware law for the specified types of actions and proceedings, this provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Company and its directors, officers, or other employees and may discourage lawsuits with respect to such claims.
Furthermore, Section 22 of the Securities Act provides for concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder, and as such, the exclusive jurisdiction clauses set forth above would not apply to such suits. 38 Although we believe the exclusive forum provision benefits us by providing increased consistency in the application of Delaware law for the specified types of actions and proceedings, this provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Company and its directors, officers, or other employees and may discourage lawsuits with respect to such claims.
Our store sales may fluctuate and a variety of factors affect comparable store sales, including: ● general economic conditions; ● the impact of new and acquired stores entering into the comparable store base; ● the opening of new stores that eroded store sales in existing areas; ● increased competitive activity; ● price changes in response to competitive factors; ● possible supply shortage; ● consumer preferences, buying trends and spending levels; ● product price inflation and deflation; ● the number and dollar amount of customer transactions in our stores; ● cycling against any year of above-average sales results; ● our ability to provide product offerings that generate new and repeat visits to our stores; ● the level of customer service that we provide in our stores; 23 ● our price optimization initiative; ● our in-store merchandising-related activities; ● our ability to source products efficiently; and ● the number of stores we open in any period.
Our store sales may fluctuate and a variety of factors affect comparable store sales, including: ● general economic conditions; ● the impact of new and acquired stores entering into the comparable store base; ● the opening of new stores that eroded store sales in existing areas; ● increased competitive activity; ● price changes in response to competitive factors; ● possible supply shortage; ● consumer preferences, buying trends and spending levels; ● product price inflation and deflation; ● the number and dollar amount of customer transactions in our stores; ● cycling against any year of above-average sales results; ● our ability to provide product offerings that generate new and repeat visits to our stores; ● the level of customer service that we provide in our stores; 24 ● our price optimization initiative; ● our in-store merchandising-related activities; ● our ability to source products efficiently; and ● the number of stores we open in any period.
For so long as we remain a controlled company under that definition, we are permitted, and intend, to elect to rely on certain exemptions from corporate governance rules, including: ● an exemption from the rule that a majority of our board of directors must be independent directors; ● an exemption from the rule that the compensation of our chief executive officer must be determined or recommended solely by independent directors; and ● an exemption from the rule that our director nominees must be selected or recommended solely by independent directors. 41 As a result, you will not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements, including that a majority of the members of our board of directors may not be independent directors, and our nominating and corporate governance and compensation committees may not consist entirely of independent directors.
For so long as we remain a controlled company under that definition, we are permitted, and intend, to elect to rely on certain exemptions from corporate governance rules, including: ● an exemption from the rule that a majority of our board of directors must be independent directors; ● an exemption from the rule that the compensation of our chief executive officer must be determined or recommended solely by independent directors; and ● an exemption from the rule that our director nominees must be selected or recommended solely by independent directors. 42 As a result, you will not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements, including that a majority of the members of our board of directors may not be independent directors, and our nominating and corporate governance and compensation committees may not consist entirely of independent directors.
The adoption or expansion of trade restrictions and tariffs, a trade war, or other governmental action related to tariffs may adversely affect our business as it may impact the cost of and demand for our products, our overall costs, our customers, our supplies, and the world economy, which in turn could have a material adverse effect on our business, operational results, financial position and cash flows. 31 Changes in and enforcement of immigration laws could increase our costs and adversely affect our ability to attract and retain qualified store-level employees.
The adoption or expansion of trade restrictions and tariffs, a trade war, or other governmental action related to tariffs may adversely affect our business as it may impact the cost of and demand for our products, our overall costs, our customers, our supplies, and the world economy, which in turn could have a material adverse effect on our business, operational results, financial position and cash flows. 32 Changes in and enforcement of immigration laws could increase our costs and adversely affect our ability to attract and retain qualified store-level employees.
The existence of an overhang, whether or not sales have occurred or are occurring, also could make more difficult our ability to raise additional financing through the sale of equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate. 38 If we are unable to continue to meet the Nasdaq Capital Market rules for continued listing, our Class A common stock could be delisted.
The existence of an overhang, whether or not sales have occurred or are occurring, also could make more difficult our ability to raise additional financing through the sale of equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate. 39 If we are unable to continue to meet the Nasdaq Capital Market rules for continued listing, our Class A common stock could be delisted.
If such financing is not available to us, or is not available to us on satisfactory terms, our ability to operate and expand our business or to respond to competitive pressures would be limited and we could be required to delay, significantly curtail or eliminate planned store openings or operations or other elements of our growth strategy. 30 We may incur additional indebtedness in the future, which could adversely affect our financial health and our ability to react to changes to our business.
If such financing is not available to us, or is not available to us on satisfactory terms, our ability to operate and expand our business or to respond to competitive pressures would be limited and we could be required to delay, significantly curtail or eliminate planned store openings or operations or other elements of our growth strategy. 31 We may incur additional indebtedness in the future, which could adversely affect our financial health and our ability to react to changes to our business.
Moreover, the FDA has the authority to administratively suspend the registration of any facility producing food, including supplements, deemed to present a reasonable probability of causing serious adverse health consequences. 32 In connection with the marketing and advertisement of products we sell, we could be the target of claims relating to false or deceptive advertising, including under the auspices of the FTC and the consumer protection statutes of some states.
Moreover, the FDA has the authority to administratively suspend the registration of any facility producing food, including supplements, deemed to present a reasonable probability of causing serious adverse health consequences. 33 In connection with the marketing and advertisement of products we sell, we could be the target of claims relating to false or deceptive advertising, including under the auspices of the FTC and the consumer protection statutes of some states.
If we were to over-order, which could result in inventory losses, or otherwise were not able to maintain inventory suitable for our business needs, it would materially and negatively impact our operating results. 25 Products we sell could cause unexpected side effects, illness, injury or death that could result in their discontinuance or expose us to lawsuits, either of which could result in unexpected costs and damage to our reputation.
If we were to over-order, which could result in inventory losses, or otherwise were not able to maintain inventory suitable for our business needs, it would materially and negatively impact our operating results. 26 Products we sell could cause unexpected side effects, illness, injury or death that could result in their discontinuance or expose us to lawsuits, either of which could result in unexpected costs and damage to our reputation.
However, there can be no assurance that our intellectual property rights will be sufficient to distinguish our products and services from those of our competitors and to provide us with a competitive advantage. 24 Our success depends upon our ability to source and market new products to meet our high standards and customer preferences and our ability to offer our customers an aesthetically pleasing shopping environment.
However, there can be no assurance that our intellectual property rights will be sufficient to distinguish our products and services from those of our competitors and to provide us with a competitive advantage. 25 Our success depends upon our ability to source and market new products to meet our high standards and customer preferences and our ability to offer our customers an aesthetically pleasing shopping environment.
Although we have been advised that there is no present intention, JSC may, in its sole discretion, release all or any portion of the shares of our Class A common stock from the restrictions in any of the lock-up agreements described above. 35 Also, in the future, we may issue shares of our Class A common stock in connection with investments or acquisitions.
Although we have been advised that there is no present intention, JSC may, in its sole discretion, release all or any portion of the shares of our Class A common stock from the restrictions in any of the lock-up agreements described above. 36 Also, in the future, we may issue shares of our Class A common stock in connection with investments or acquisitions.
If we fail to successfully implement our growth strategy, including by opening new stores, our business and financial condition and operating results may be adversely affected. 21 The terms of our debt financing arrangements may restrict our current and future operations, which could adversely affect our ability to respond to changes in our business and to manage our operations.
If we fail to successfully implement our growth strategy, including by opening new stores, our business and financial condition and operating results may be adversely affected. 22 The terms of our debt financing arrangements may restrict our current and future operations, which could adversely affect our ability to respond to changes in our business and to manage our operations.
As a result, he may take actions that you do not believe to be in our interests or your interests and that could depress the price of our Class A common stock. 36 We do not intend to pay cash dividends on our Class A common stock and, as a result, your only opportunity to achieve a return on your investment is if the price of our Class A common stock appreciates.
As a result, he may take actions that you do not believe to be in our interests or your interests and that could depress the price of our Class A common stock. 37 We do not intend to pay cash dividends on our Class A common stock and, as a result, your only opportunity to achieve a return on your investment is if the price of our Class A common stock appreciates.
Compliance with these requirements may make it more difficult for the Company’s stockholders to resell their shares of Class A common stock to third parties or to otherwise dispose of them. 39 The financial and operational projections that we may make from time to time are subject to inherent risks.
Compliance with these requirements may make it more difficult for the Company’s stockholders to resell their shares of Class A common stock to third parties or to otherwise dispose of them. 40 The financial and operational projections that we may make from time to time are subject to inherent risks.
The impact of these events can adversely affect our operations, financial condition, and results of operations or cash flows. 33 Risks Related to Ownership of Our Class A Common Stock The market for our Class A common stock is new, and we cannot assure you that an active trading market will develop for our Class A common stock.
The impact of these events can adversely affect our operations, financial condition, and results of operations or cash flows. 34 Risks Related to Ownership of Our Class A Common Stock The market for our Class A common stock is new, and we cannot assure you that an active trading market will develop for our Class A common stock.
Any of these factors may disrupt our business and materially and adversely affect our business and financial condition and result of operations . 26 Energy costs are an increasingly significant component of our operating expenses and increasing energy costs, unless offset by more efficient usage or other operational responses, may impact our profitability.
Any of these factors may disrupt our business and materially and adversely affect our business and financial condition and result of operations . 27 Energy costs are an increasingly significant component of our operating expenses and increasing energy costs, unless offset by more efficient usage or other operational responses, may impact our profitability.
The Company, its directors, and certain officers are currently subject to certain litigation, including securities class actions and shareholder derivative actions, as further described in Note 17 — “ Commitments and Contingencies ” to the consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
The Company, its directors, and certain officers are currently subject to certain litigation, including securities class actions and shareholder derivative actions, as further described in Note 18 — “ Commitments and Contingencies ” to the consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
We do not maintain key person insurance on any employee. In addition, none of our key employees are subject to non-competition or non-solicitation obligations. 29 If we are unable to attract, train and retain employees, we may not be able to grow or successfully operate our business.
We do not maintain key person insurance on any employee. In addition, none of our key employees are subject to non-competition or non-solicitation obligations. 30 If we are unable to attract, train and retain employees, we may not be able to grow or successfully operate our business.
As of April 30, 2024, there were 17,450,476 shares of Class A common stock issued and outstanding. The sale of substantial amounts of shares of our Class A common stock in the public market, or the perception that such sales could occur, could harm the prevailing market price of shares of our Class A common stock.
As of April 30, 2025, there were 17,450,476 shares of Class A common stock issued and outstanding. The sale of substantial amounts of shares of our Class A common stock in the public market, or the perception that such sales could occur, could harm the prevailing market price of shares of our Class A common stock.
The price may increase in doing business through these suppliers which could adversely affect our business, financial condition and results of operations. 27 Our reliance on relatively few vendors for the majority of our inventory could adversely affect our ability to operate.
The price may increase in doing business through these suppliers which could adversely affect our business, financial condition and results of operations. 28 Our reliance on relatively few vendors for the majority of our inventory could adversely affect our ability to operate.
While the economic rights of our common stock are the same, the Class A common stock has one (1) vote per share, while Class B common stock has ten (10) votes per share. As of April 30, 2024, our Class B common stockholders represent approximately 56.2% of our voting power.
While the economic rights of our common stock are the same, the Class A common stock has one (1) vote per share, while Class B common stock has ten (10) votes per share. As of April 30, 2025, our Class B common stockholders represent approximately 56.2% of our voting power.
See “ Certain Relationships and Related Party Transactions ” for specific information about our related party transactions. 22 Security incidents and attacks on our information technology systems could lead to significant costs and disruptions that could harm our business, financial results, and reputation.
See “ Certain Relationships and Related Party Transactions ” for specific information about our related party transactions. 23 Security incidents and attacks on our information technology systems could lead to significant costs and disruptions that could harm our business, financial results, and reputation.
We and our independent registered public accounting firm identified certain material weaknesses in our internal control over financial reporting in connection with the audited consolidated financial statements for the years ended April 30, 2024 and 2023.
We and our independent registered public accounting firm identified certain material weaknesses in our internal control over financial reporting in connection with the audited consolidated financial statements for the years ended April 30, 2025 and 2024.
Our competition varies and includes national, regional and local conventional supermarkets, national superstores, alternative food retailers, natural foods stores, smaller specialty stores, farmers’ markets, supercenters, online retailers, mass or discount retailers and membership warehouse clubs. Our principal competitors include 99 Ranch Market and HMart for traditional supermarkets and Weee! for online groceries.
Our competition varies and includes national, regional and local conventional supermarkets, national superstores, alternative food retailers, natural foods stores, smaller specialty stores, farmers’ markets, supercenters, online retailers, mass or discount retailers and membership warehouse clubs. Our principal competitors include 99 Ranch Market and H Mart for traditional supermarkets and Weee! for online groceries.
Any or all of these factors and conditions could negatively impact our growth and profitability. 28 Legal proceedings could materially impact our business, financial condition and results of operations.
Any or all of these factors and conditions could negatively impact our growth and profitability. 29 Legal proceedings could materially impact our business, financial condition and results of operations.
As a result, potential investors may be less likely to invest in our securities. 42 ITEM 1B. UNRESOLVED STAFF COMMENTS Not applicable.
As a result, potential investors may be less likely to invest in our securities. 43 ITEM 1B. UNRESOLVED STAFF COMMENTS Not applicable.
We currently rely on a relatively small number of vendors to provide us with the majority of our inventory, with three of our vendors providing approximately 34% of our total inventory in the year ended April 30, 2024 and three of our vendors providing approximately 33% of our total inventory in the year ended April 30, 2023.
We currently rely on a relatively small number of vendors to provide us with the majority of our inventory, with three of our vendors providing approximately 40% of our total inventory in the year ended April 30, 2025 and three of our vendors providing approximately 34% of our total inventory in the year ended April 30, 2024.
We are a borrower under certain bank loans and loans from the U.S. Small Business Administration (the “SBA”) in the aggregate amount of approximately $2.56 million as of April 30, 2024.
We are a borrower under certain bank loans and loans from the U.S. Small Business Administration (the “SBA”) in the aggregate amount of approximately $2.62 million as of April 30, 2025.
Our stores rely heavily on sales of perishable products, and product supply disruptions may have an adverse effect on our profitability and operating results. We have a significant focus on perishable products. Sales of perishable products accounted for approximately 54.0% and 56.5% of our total sales in fiscal years 2024 and 2023, respectively.
Our stores rely heavily on sales of perishable products, and product supply disruptions may have an adverse effect on our profitability and operating results. We have a significant focus on perishable products. Sales of perishable products accounted for approximately 51.4% and 54.0% of our total sales in fiscal years 2025 and 2024, respectively.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe have not encountered cybersecurity threats or incidents that have had a material impact on our business. Governance Our Board of Directors has specific oversight responsibility for cybersecurity, which also oversees our general risk management. The Board of Directors reviews and discusses with management our policies, practices and risks related to information security and cybersecurity.
Biggest changeWe have not encountered cybersecurity threats or incidents that have had a material impact on our business. Governance Our Board of Directors, which also oversees our general risk management, has specific oversight responsibility for cybersecurity. The Board of Directors reviews and discusses with management our policies, practices and risks related to information security and cybersecurity.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeDuarte Road, Monrovia, CA, 91016 25,320 8/31/2055 Super HK of El Monte, Inc. 11850 Valley Boulevard, El Monte, CA, 91732 62,000 7/14/2028 GF Supermarket of MP, Inc. (Acquisition on 6/30/2022) 127 N. Garfield Avenue, Monterey Park, CA 91732 31,716 5/1/2028 Lee Lee – Peoria Store 7575 W.
Biggest changeDuarte Road, Monrovia, CA, 91016 25,320 8/31/2055 GF Supermarket of MP, Inc. (Acquisition on 6/30/2022) 127 N. Garfield Avenue, Monterey Park, CA 91732 31,716 5/1/2028 Lee Lee – Peoria Store 7575 W. Cactus Road, Peoria, AZ 85381 60,080 1/31/2044 Lee Lee – Chandler Store 2025 N.
ITEM 2. PROPERTIES The Company leases its current executive office, which is located at 127 N. Garfield Avenue, Monterey Park, California 91732, and is also the location of the Maison Monterey Park store. All of our retail supermarkets lease operating space from various third parties with which we maintain long-term leases.
ITEM 2. PROPERTIES The Company leases its current executive office, which is located at 127 N. Garfield Avenue, Monterey Park, California 91732, which is also the location of the Maison Monterey Park store. All of our retail supermarkets lease operating space from various third parties with which we maintain long-term leases.
The list below details the information related to our leases: Store Name Location Gross Sq. Ft. Lease End Date (including all renewal options) Good Fortune Supermarket of San Gabriel, LP 137 S. San Gabriel Blvd., San Gabriel, CA, 91776 25,638 11/30/2030 Hong Kong Supermarket Monrovia, LP 935 W.
The list below details the information related to our leases: Store Name Location Gross Sq. Ft. Lease End Date (including all renewal options) Good Fortune Supermarket of San Gabriel, LP 137 S. San Gabriel Blvd., San Gabriel, CA, 91776 25,638 11/30/2030 Good Fortune Supermarket of Monrovia, LP 935 W.
Cactus Road, Peoria, AZ 85381 60,080 1/31/2044 Lee Lee – Chandler Store 2025 N. Dobson Road, Chandler, AZ 85224 52,224 2/8/2049 Lee Lee – Tucson Store 1990 Orange Grove Road, Tucson, AZ 85704 51,422 12/31/2050 We believe that our facilities are sufficient for our current needs and operations.
Dobson Road, Chandler, AZ 85224 52,224 2/8/2049 Lee Lee – Tucson Store 1990 Orange Grove Road, Tucson, AZ 85704 51,422 12/31/2050 We believe that our facilities are sufficient for our current needs and operations.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS Information regarding our legal proceedings can be found in Note 17 — “ Commitments and Contingencies ” to the consolidated financial statements included in this Annual Report on Form 10-K and is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 43 PART II
Biggest changeITEM 3. LEGAL PROCEEDINGS Information regarding our legal proceedings can be found in Note 18 — “ Commitments and Contingencies ” to the consolidated financial statements included in this Annual Report on Form 10-K and is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 44 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeRecent Sales of Unregistered Securities There were no sales of unregistered securities during fiscal year 2024 other than those transactions previously reported to the SEC on our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
Biggest changeRecent Sales of Unregistered Securities There were no sales of unregistered securities during the fiscal year ended April 30, 2025 other than those transactions previously reported to the SEC on our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our Class A common stock is listed on the Nasdaq Stock Market LLC under the trading symbol “MSS.” Stockholders As of August 6, 2024, we had six stockholders of record of our Class A common stock.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our Class A common stock is listed on the Nasdaq Stock Market LLC under the trading symbol “MSS.” Stockholders As of August 12, 2025, we had six stockholders of record of our Class A common stock.
Issuer Purchases of Equity Securities The Company did not repurchase any of its outstanding shares of Class A common stock during the fourth quarter of the fiscal year ended April 30, 2024. ITEM 6. [RESERVED] 44
Issuer Purchases of Equity Securities The Company did not repurchase any of its outstanding shares of Class A common stock during the fourth quarter of the fiscal year ended April 30, 2025. ITEM 6. [RESERVED] 45

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeGeneral and administrative expenses primarily consist of costs for corporate functions, including payroll and related expenses; facilities and equipment expenses, such as depreciation and amortization expense and rent; and professional fees and litigation costs. 49 Results of Operations for the Years Ended April 30, 2024 and 2023 Years ended April 30, 2024 2023 Change Percentage Change Net revenues $ 58,043,161 $ 55,399,112 $ 2,644,049 4.8 % Cost of revenues 46,422,064 42,947,952 3,474,112 8.1 % Gross profit 11,621,097 12,451,160 (830,063 ) (6.7 )% Operating expenses Selling expenses 10,155,828 8,479,578 1,676,250 19.8 % General and administrative expenses 4,169,275 3,887,935 281,340 7.2 % Total operating expenses 14,325,103 12,367,513 1,957,590 15.8 % Income (loss) from operations (2,704,006 ) 83,647 (2,787,653 ) (3,332.6 )% Other income (expenses), net (118,201 ) 1,849,534 (1,967,735 ) (106.4 )% Interest income (expense),net (124,260 ) 42,606 (166,866 ) (391.6 )% Income (loss) before income taxes (2,946,467 ) 1,975,787 (4,922,254 ) (249.1 )% Income tax provisions 440,562 336,486 104,076 30.9 % Net income (loss) (3,387,029 ) 1,639,301 (5,026,330 ) (306.6 )% Net income (loss) attributable to noncontrolling interests (46,823 ) 387,498 (434,321 ) (112.1 )% Net income (loss) attributable to Maison Solutions Inc. $ (3,340,206 ) $ 1,251,803 $ (4,592,009 ) (366.8 )% Revenues Years ended April 30, 2024 2023 Change Percentage Change Perishables $ 31,358,590 $ 31,291,786 $ 66,804 0.2 % Non-perishables 26,684,571 24,107,326 2,577,245 10.7 % Net revenue $ 58,043,161 $ 55,399,112 $ 2,644,049 4.8 % Our net revenues were approximately $58.0 million for the year ended April 30, 2024, an increase of approximately $2,644,049 or 4.8%, from approximately $55.4 million for the year ended April 30, 2023.
Biggest changeResults of Operations for the Years Ended April 30, 2025 and 2024 Years Ended April 30, 2025 2024 Change Percentage Change increase (decrease) Net revenues $ 124,217,480 $ 58,043,161 $ 66,174,319 114.0 % Cost of revenues 97,874,929 46,422,064 51,452,865 110.8 % Gross profit 26,342,551 11,621,097 14,721,454 126.7 % Operating expenses Selling expenses 19,718,836 10,155,828 9,563,008 94.2 % General and administrative expenses 7,888,721 4,169,275 3,719,446 89.2 % Total operating expenses 27,607,557 14,325,103 13,282,454 92.7 % Loss from operations (1,265,006 ) (2,704,006 ) 1,439,000 53.2 % Other income (expenses), net 3,527,799 (118,201 ) 3,646,000 3,084.6 % Interest expense, net (1,167,895 ) (124,260 ) 1,043,635 839.9 % Income (loss) before income taxes 1,094,898 (2,946,467 ) 4,041,365 137.2 % Income tax provisions 173,989 440,562 (266,573 ) (60.5 )% Net income (loss) before noncontrolling interests 920,909 (3,387,029 ) 4,307,938 127.2 % Net loss attributable to noncontrolling interests (248,364 ) (46,823 ) (201,541 ) (430.4 )% Net income (loss) attributable to Maison Solutions Inc. $ 1,169,273 $ (3,340,206 ) $ 4,509,479 135.0 % 51 Revenues Years Ended April 30, 2025 2024 Change Percentage Change Perishables $ 63,789,150 $ 31,358,590 $ 32,430,560 103.4 % Non-perishables 60,428,330 26,684,571 33,743,759 126.5 % Net revenue $ 124,217,480 $ 58,043,161 $ 66,174,319 114.0 % Our net revenues were approximately $124.2 million for the year ended April 30, 2025, an increase of approximately $66.2 million or 114.0%, from approximately $58.0 million for the year ended April 30, 2024.
Pursuant to the Securities Purchase Agreements, we sold an aggregate of 1,190,476 shares of the Company’s Class A common stock, par value $0.0001 per share, to the Investors at a per share purchase price of $4.20 (the “PIPE Offering”). The PIPE Offering closed on November 22, 2023.
Pursuant to the Securities Purchase Agreements, we sold an aggregate of 1,190,476 shares of the Company’s Class A common stock, par value $0.0001 per share, to the PIPE Investors at a per share purchase price of $4.20 (the “PIPE Offering”). The PIPE Offering closed on November 22, 2023.
This is based on management’s best estimate as of the date of this Report. We used part of the proceeds from our IPO to support our business expansion described above. We may also seek additional financing, to the extent needed, and there can be no assurance that such financing will be available on favorable terms, or at all.
This is based on the management’s best estimate as of the date of this Report. We used part of the proceeds from our IPO to support our business expansion described above. We may also seek additional financing, to the extent needed, and there can be no assurance that such financing will be available on favorable terms, or at all.
On April 12, 2024, another derivative complaint was filed by Arnab Baral in the United States District Court Central District of California, Case No. 2:24-cv-03018. The two cases have since been consolidated, with the Azad case taking lead.
On April 12, 2024, another derivative complaint was filed by Arnab Baral in the United States District Court Central District of California, Case No. 2:24-cv-03018. The two cases have since been consolidated, with the Azad case taking the lead.
Our ability to continue to fund these items may be affected by general economic, competitive, and other factors, many of which are outside of our control. 52 On October 4, 2023, we entered into an Underwriting Agreement with Joseph Stone Capital, LLC in connection with the Company’s initial public offering (the “IPO”) of 2,500,000 shares of Class A common stock, par value $0.0001, at a price of $4.00 per share, less underwriting discounts and commissions.
Our ability to continue to fund these items may be affected by general economic, competitive, and other factors, many of which are outside of our control. 54 On October 4, 2023, we entered into an Underwriting Agreement with Joseph Stone Capital, LLC in connection with the Company’s initial public offering (the “IPO”) of 2,500,000 shares of Class A common stock, par value $0.0001, at a price of $4.00 per share, less underwriting discounts and commissions.
Additionally, pursuant to the terms and conditions of the senior secured note agreement, the principal amount may be adjusted to include certain Premium Guarantees (as defined in the senior secured note agreement) if certain conditions, as set forth in the senior secured note agreement and the purchase agreement, are not met.
Additionally, pursuant to the terms and conditions of the Senior Secured Note Agreement, the principal amount may be adjusted to include certain Premium Guarantees (as defined in the Senior Secured Note Agreement) if certain conditions, as set forth in the Senior Secured Note Agreement and the Stock Purchase Agreement, are not met.
It is reasonably possible that a loss may be incurred; however, the possible range of losses is not reasonably estimable given the pending status of both cases.
It is reasonably possible that a loss may be incurred; however, the possible range of losses is not reasonably estimable given the pending status of the cases.
Also on April 8, 2024, in connection with the execution of the Senior Secured Note Agreement, and pursuant to the Purchase Agreement, John Jun Xu, Chairman, Chief Executive Officer and controlling stockholder of the Company, and Grace Xu, spouse of John Jun Xu (together with John Jun Xu, the “Xu Guarantors”), entered into a guarantee (the “Xu Guarantee” and, together with the Purchaser Guarantee, the “Guarantees”) to and for the benefit of the Sellers, pursuant to which the Xu Guarantors unconditionally guarantee the payment by Lee Lee of the Principal Amount, as adjusted pursuant to the Secured Note and the faithful and prompt performance by Lee Lee of the conditions and covenants of the Secured Note.
Also on April 8, 2024, in connection with the execution of the Senior Secured Note Agreement, and pursuant to the Stock Purchase Agreement, John Jun Xu, Chairman, Chief Executive Officer and controlling stockholder of the Company, and Grace Xu, spouse of John Jun Xu (together with John Jun Xu, the “Xu Guarantors”), entered into a guarantee (the “Xu Guarantee” and, together with the AZLL Guarantee, the “Guarantees”) to and for the benefit of the Sellers, pursuant to which the Xu Guarantors unconditionally guarantee the payment by Lee Lee of the principal amount of the Secured Note, as adjusted pursuant to the Secured Note and the faithful and prompt performance by Lee Lee of the conditions and covenants of the Secured Note.
Significant maintenance or renovation would affect our operations and operating results. Meanwhile, improving the store environment can also attract more customers and lead to an increase in sales. Maison focused on improving and renovating our stores for the years ended April 30, 2024 and 2023.
Significant maintenance or renovation would affect our operations and operating results. Meanwhile, improving the store environment can also attract more customers and lead to an increase in sales. Maison focused on improving and renovating our stores for the years ended April 30, 2025 and 2024.
The IPO closed on October 10, 2023, and the Company received net proceeds of approximately $8.72 million, after deducting underwriting discounts and commissions and estimated IPO offering expenses payable by the Company. On November 22, 2023, we entered into certain securities purchase agreements (the “Securities Purchase Agreements”) with certain investors (the “Investors”).
The IPO closed on October 10, 2023, and the Company received net proceeds of approximately $8.72 million, after deducting underwriting discounts and commissions and estimated IPO offering expenses payable by the Company. On November 22, 2023, we entered into certain securities purchase agreements (the “Securities Purchase Agreements”) with certain investors (the “PIPE Investors”).
Senior Secured Note Payable On April 8, 2024, AZLL closed an acquisition transaction and purchased 100% of the equity interests in Lee Lee for an aggregate purchase price of approximately $22.2 million, consisting of: (i) $7.0 million in cash paid immediately at the closing of the Transaction, and (ii) a senior secured note agreement with an original principal amount of approximately $15.2 million entered on April 8, 2024.
Senior Secured Note Payable On April 8, 2024, AZLL closed an acquisition transaction and purchased 100% of the equity interests in Lee Lee for an aggregate purchase price of approximately $22.2 million, consisting of: (i) $7.0 million in cash paid immediately at the closing of the transaction, and (ii) the Secured Note with an original principal amount of approximately $15.2 million pursuant to the Senior Secured Note Agreement.
The Company records inventory shrinkage based on historical data and management’s estimates and provided a reserve for inventory shrinkage for the fiscal years ended April 30, 2024 and 2023.
The Company records inventory shrinkage based on historical data and management’s estimates and provided a reserve for inventory shrinkage for the fiscal years ended April 30, 2025 and 2024.
Small Business Administration (the “SBA”) On June 15, 2020, Maison Monrovia entered into a $150,000 Business Loan Agreement with the SBA at 3.75% annual interest rate and the maturity date on June 15, 2050.
Debt U.S. Small Business Administration (the “SBA”) On June 15, 2020, Maison Monrovia entered into a $150,000 Business Loan Agreement with the SBA at 3.75% annual interest rate and the maturity date on June 15, 2050.
To accomplish such expansion plan, we estimate the total related capital investment and expenditures to be approximately $35 million to $40 million, among which approximately $13 million to $16 million will be required within the next 12 months to support our preparation and opening of new stores in Southern and Northern California and acquiring additional supermarkets on the East Coast.
To accomplish such expansion plan, we estimate the total related capital investment and expenditures to be approximately $35 million to $40 million, among which approximately $13 million to $16 million will be required within the next 12 months to support our preparation and opening of new stores and acquiring additional supermarkets on the East Coast and additional regions near California.
Financing Activities Net cash provided by financing activities was approximately $13.1 million for the year ended April 30, 2024, which mainly consisted of net proceeds from issuance of common stock of approximately $13.3 million, bank overdraft of $97,445 and borrowing from related parties $250,000, which was partially offset by repayment on loans payable of approximately $370,825 million, and repayment for a note payable of $150,000.
Net cash provided by financing activities was approximately $13,140,512 for the year ended April 30, 2024, which mainly consisted of net proceeds from issuance of common stock of approximately $13,313,892, bank overdraft of $97,445 and borrowing from related parties $250,000, which was partially offset by repayment on loans payable of $370,825 million, and repayment for a note payable of $150,000.
The following table summarizes our cash flow data for the years ended April 30, 2024 and 2023.
The following table summarizes our cash flow data for the years ended April 30, 2025 and 2024.
The seafood and meat departments have a low allowance rate because the non-fresh products can freeze and sell for the same price or even higher price after being cut. The cost of revenues increased by $3.5 million, from $42.9 million for the year ended April 30, 2023, to approximately $46.4 million for the year ended April 30, 2024.
The seafood and meat departments have a low allowance rate because the non-fresh products can freeze and sell for the same price or even higher price after being cut. The cost of revenues increased by $51.5 million, from $46.4 million for the year ended April 30, 2024, to approximately $97.9 million for the year ended April 30, 2025.
For the year ended April 30, 2024, other expenses mainly consisted of investment loss from equity method investment of $538,542, which was partly offset by $383,161 employee retention credit (“ERC”) received in 2024 and other income of $37,180. For the year ended April 30, 2023, other income mainly consisted of $1.9 million ERC received for the year ended April 30,2023.
For the year ended April 30, 2024, other expenses mainly consisted of investment loss from equity method investment of $538,542, which was partly offset by $383,161 employee retention credit (“ERC”) received in 2024 and other income of $37,180.
The Company also offers discounts on the gift cards sold to its customers. The discounts are recorded as sales discount when gift card been redeemed. The Company’s contract liability related to gift cards was $965,696 and $449,334 as of April 30, 2024 and 2023, respectively.
The Company also offers discounts on the gift cards sold to its customers. The discounts are recorded as sales discount when gift card been redeemed. The Company’s contract liability related to gift cards was $701,929 and $965,696 as of April 30, 2025 and 2024, respectively.
The increase in net revenues was driven by the inclusion of revenues from our newly acquired subsidiary (acquired in April 2024) Lee Lee of $4.6 million, and increased sales of Maison Monterey Park supermarket (acquired in July 2023) by $4.4 million, which was partly offset by decreased sales of Maison San Gabriel by $3.3 million, decreased sales of Maison Monrovia by $1.6 million and decreased sales of Maison El Monte by $1.5 million, as compared to the year ended April 30, 2023.
The increase in net revenues was driven by the inclusion of revenues from our newly acquired subsidiary, Lee Lee (acquired in April 2024), of $78.2 million, which was partly offset by decreased sales of Maison Monterey Park by $2.3 million, decreased sales of Maison San Gabriel by $2.9 million, decreased sales of Maison Monrovia by $1.5 million and decreased sales of Maison El Monte by $0.6 million, as compared to the year ended April 30, 2024.
Lee Lee holds three supermarkets specializing on South-East groceries in Arizona. 45 Collaboration with JD.com On April 19, 2021, JD E-commerce America Limited (“JD US”), the U.S. subsidiary of JD.com, and Maison entered into a Collaboration Agreement (the “Collaboration Agreement”) pursuant to which JD.com will provide services to Maison focused on updating in store technology through the development of a new mobile app, the updating of new in-store technology, and revising store layouts to promote efficiency.
Collaboration with JD.com On April 19, 2021, JD E-commerce America Limited (“JD US”), the U.S. subsidiary of JD.com, and Maison entered into a Collaboration Agreement (the “Collaboration Agreement”) pursuant to which JD.com will provide services to Maison focused on updating in store technology through the development of a new mobile app, the updating of new in-store technology, and revising store layouts to promote efficiency.
We received net proceeds of approximately $4.60 million, after deducting investment banker’s discounts and commissions and offering expenses payable by the Company. We plan to acquire and open additional supermarkets with a portion of the proceeds of our IPO and the PIPE Offering to expand our footprint to both the West Coast and the East Coast.
We received net proceeds of approximately $4.60 million, after deducting investment banker’s discounts and commissions and offering expenses payable by the Company. We plan to acquire and open additional supermarkets, satellite stores and warehouses to expand our footprint to both the West Coast and the East Coast.
Payroll expense increased by $1.2 million in the year ended April 30, 2024, as compared to the year ended April 30, 2023 due to the increase of hourly rate and increased number of employees due to the acquisition of Lee Lee.
Payroll expense increased by $7.6 million in the year ended April 30, 2025, as compared to the year ended April 30, 2024 due to the increase of hourly rate and increased number of employees due to the acquisition of Lee Lee.
Total operating expenses as a percentage of revenues were 24.7% and 22.3% for the years ended April 30, 2024 and 2023, respectively. The increase in operating expenses was primarily attributable to the increase in selling expenses, which included the increase in payroll expense, utility expense, advertising and promotion expense, postage & delivery expense and merchant service charges.
Total operating expenses as a percentage of revenues were 22.3% and 24.7% for the years ended April 30, 2025 and 2024, respectively. The increase in operating expenses was primarily attributable to the increase in selling expenses, which included the increase in payroll expense, utility expense, and merchant service charges as result of the acquisition of Lee Lee.
Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests. 47 Use of Estimates The preparation of consolidated financial statements in conformity with U.S.
Related parties also include principal owners of the Company, its management, members of the immediate families of principal owners of the Company and its management and other parties with which the Company may deal with if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests.
GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented.
Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented.
On April 8, 2024, in connection with the execution of the Senior Secured Note Agreement, and pursuant to the Stock Purchase Agreement, AZLL entered into a guarantee (the “Purchaser Guarantee”) to and for the benefit of the Sellers, pursuant to which AZLL unconditionally guarantees the payment by Lee Lee of the Principal Amount, as adjusted pursuant to the Secured Note and the faithful and prompt performance by Lee Lee of the conditions and covenants of the Secured Note.
The Company is required to repay the full amount before May 11, 2026. 58 On April 8, 2024, in connection with the execution of the Senior Secured Note Agreement, and pursuant to the Stock Purchase Agreement, AZLL entered into a guarantee (the “AZLL Guarantee”) to and for the benefit of the Sellers, pursuant to which AZLL unconditionally guarantees the payment by Lee Lee of the principal amount of the Secured Note, as adjusted pursuant to the Secured Note and the faithful and prompt performance by Lee Lee of the conditions and covenants of the Secured Note.
Liquidity and Capital Resources Cash Flows for the Year Ended April 30, 2024 Compared to the Year Ended April 30, 2023 As of April 30, 2024, we had cash, cash equivalents and restricted cash of approximately $1,101.
Liquidity and Capital Resources Cash Flows for the Year Ended April 30, 2025 Compared to the Year Ended April 30, 2024 As of April 30, 2025, we had cash and cash equivalents of approximately $775,360.
The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that it will exercise such options. 48 A short-term lease is defined as a lease that, at the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise.
A short-term lease is defined as a lease that, at the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise.
On June 15, 2020, Maison San Gabriel entered into a $150,000 Business Loan Agreement with the SBA at 3.75% annual interest rate and the maturity date on June 15, 2050. On June 15, 2020, Maison El Monte, entered into a $150,000 Business Loan Agreement with the SBA at 3.75% annual interest rate and the maturity date on June 15, 2050.
On June 15, 2020, Maison El Monte entered into a $150,000 Business Loan Agreement with the SBA at 3.75% annual interest rate and the maturity date on June 15, 2050. On January 6, 2022, Maison El Monte received an extra $350,000 loan from the SBA at 3.75% annual interest rate and the maturity date on June 15, 2050.
Operating Cost Increase After Initial Public Offering We historically have operated our business as a private company. We completed our initial public offering on October 10, 2023.
Inflation increased our purchase costs, occupancy costs, and payroll costs. 47 Operating Cost Increase After Initial Public Offering We historically have operated our business as a private company. We completed our initial public offering on October 10, 2023.
Gross margin represents gross profit as a percentage of net revenues. Occupancy costs include store rental costs. The components of our cost of revenues and occupancy costs may not be identical to those of our competitors. As a result, our gross profit and gross margin may not be comparable to similar data made available by our competitors.
Gross Profit We calculate gross profit as net revenues less cost of revenues and occupancy costs. Gross margin represents gross profit as a percentage of net revenues. Occupancy costs include store rental costs. The components of our cost of revenues and occupancy costs may not be identical to those of our competitors.
Payroll As of April 30, 2024, we had approximately 355 employees including employees from our newly acquired subsidiary Lee Lee. Our employees are not unionized nor, to our knowledge, are there any plans for them to unionize. We have never experienced a strike or significant work stoppage. We consider our employee relations to be good.
Payroll As of April 30, 2025, we had approximately 378 employees including employees from our newly acquired subsidiary, Lee Lee, which is based in the State of Arizona. Our employees are not unionized nor, to our knowledge, are there any plans for them to unionize. We have never experienced a strike or significant work stoppage.
Our payroll and payroll tax expenses were $7.4 million and $6.2 million for the years ended April 30, 2024 and 2023, respectively. 46 Vendor and Supply Management Maison believes that a centralized and efficient vendor and supply management system is the key to profitability. Maison has major vendors, including ONCO Food Corp., GF Distribution, Inc., and XHJC Holding Inc.
Our payroll and payroll tax expenses were $15.0 million and $7.4 million for the years ended April 30, 2025 and 2024, respectively. Vendor and Supply Management Maison believes that a centralized and efficient vendor and supply management system is the key to profitability. Maison has major vendors, including Lawrence Wholesale, BRC International Inc, XHJC Holding Inc, K.C.
Key Factors that Affect Operating Results Inflation The inflation rate for the United States was 3.4% for the year ended April 30, 2024, 4.9% for the year ended April 30, 2023 and 8.3% for the year ended April 30, 2022 according to Bureau of Labor Statistics. Inflation increased our purchase costs, occupancy costs, and payroll costs.
Key Factors that Affect Operating Results Inflation The inflation rate for the United States was 2.3% for the year ended April 30, 2025, 3.4% for the year ended April 30, 2024 according to Bureau of Labor Statistics.
Minimum wage rates in some states have recently increased. For example, in California, the minimum wage was $15.50 per hour in 2023, and increased to $16 per hour starting from January 1, 2024.
For example, in California, the minimum wage was $15.50 per hour in 2023 and increased to $16.50 per hour starting from January 1, 2025; in Arizona, the minimum wage was $13.85 per hour in 2023, and increased to $14.35 per hour starting from January 1, 2024.
Cost of Revenues Years ended April 30, 2024 2023 Change Percentage Change Total cost of revenues $ 46,422,064 $ 42,947,952 $ 3,474,112 8.1 % 50 Cost of revenues includes cost of supermarket product sales and occupancy costs, which are store rent expense, depreciation for store property and equipment, inventory shrinkage costs and store supplies.
Cost of Revenues Years Ended April 30, 2025 2024 Change Percentage Change Total cost of revenues $ 97,874,929 $ 46,422,064 $ 51,452,865 110.8 % Cost of revenues includes cost of supermarket product sales and occupancy costs, which are store rent expense, depreciation for store property and equipment, inventory shrinkage costs and store supplies.
Gross margin was 20.0% and 22.5% for the years ended April 30, 2024 and 2023, respectively. Our supermarkets’ sales profit margins decreased by 2.5% for the year ended April 30, 2024 compared to the year ended April 30, 2023.
Gross margin was 21.3% and 20.0% for the year ended April 30, 2025 and 2024, respectively. Our supermarkets’ sales profit margins increased by 1.3% for the year ended April 30, 2025 compared to the year ended April 30, 2024.
Our ability to repay our current expenses and obligations will depend on the future realization of our current assets. Management has considered the historical experience, the economy, trends in the retail grocery industry, the expected collectability of our accounts receivable and the realization of the inventories as of April 30, 2024 and 2023.
Management has considered the historical experience, the economy, trends in the retail grocery industry, the expected collectability of our accounts receivable and the realization of the inventories as of April 30, 2025 and 2024.
We had net loss attributable to us of $3,340,206 for the year ended April 30, 2024, and had a working capital deficit of approximately $16.9 million as of April 30, 2024.
We had net income attributable to us of $1,169,273 for the year ended April 30, 2025, and had a working capital deficit of approximately $9.82 million as of April 30, 2025.
Net Income (Loss ) Net loss attributable to the Company was $3,340,206 for the year ended April 30, 2024, an increase of $4,592,009, or 366.8%, from a $1,251,803 net income attributable to the Company for the year ended April 30, 2023.
Net Income (Loss ) Net income attributable to the Company was $1,169,273 for the year ended April 30, 2025, an increase of $4,509,479, or 135.0%, from a $3,340,206 net loss attributable to the Company for the year ended April 30, 2024.
On April 8, 2024, AZLL closed an acquisition transaction and purchased 100% of the equity interests in Lee Lee Oriental Supermart, Inc (“Lee Lee”) for an aggregate purchase price of approximately $22.2 million, consisting of: (i) $7.0 million in cash paid immediately at the closing of the Transaction, and (ii) a senior secured note agreement with an original principal amount of approximately $15.2 million.
(“Lee Lee”) for an aggregate purchase price of approximately $22.2 million, consisting of: (i) $7.0 million in cash paid immediately at the closing of the transaction, and (ii) a senior secured promissory note (the “Secured Note”) with an original principal amount of approximately $15.2 million pursuant to a senior secured note agreement dated April 8, 2024 and amended on October 21, 2024 (as amended, the “Senior Secured Note Agreement”).
Years ended April 30, 2024 2023 Net cash provided by (used in) operating activities $ (3,503,146 ) $ 484,191 Net cash provided by (used in) investing activities (12,207,132 ) 1,860,882 Net cash provided by financing activities 13,140,512 (746,637 ) Net change in cash and restricted cash $ 1,101 $ 2,570,867 Operating Activities Net cash used by operating activities was approximately $3.5 million for the year ended April 30, 2024, which mainly comprised of net loss of $3,387,029, add-back of non-cash adjustment to net loss including depreciation expense of $461,868, and investment loss from 49% equity investee HKGF Arcadia store of $538,542.
Net cash used in operating activities was approximately $3.5 million for the year ended April 30, 2024, which mainly comprised of net loss of $3,387,029, add-back of non-cash adjustment to net loss including depreciation expense of $461,868, and investment loss from 49% equity investee HKGF Arcadia store of $538,542.
Postage and delivery expenses increased by $55,884 in the year ended April 30, 2024, as compared to the year ended April 30, 2023. Merchant eservice charges increased by $0.1 million in the year ended April 30, 2024, as compared to the year ended April 30, 2023 due to increased sales as describe above.
Utility expenses increased by $0.9 million in the year ended April 30, 2025, as compared to the year ended April 30, 2024. Merchant service charges increased by $1.1 million in the year ended April 30, 2025, as compared to the year ended April 30, 2024 due to increased sales from Lee Lee as describe above.
Per the SBA loan agreement, all these three loans’ interest payments were deferred to December 2022. On January 12, 2022, Maison San Gabriel received an extra $1,850,000 fund from the SBA at 3.75% annual interest rate and the maturity date on June 15, 2050.
On June 15, 2020, Maison San Gabriel entered into a $150,000 Business Loan Agreement with the SBA at 3.75% annual interest rate and the maturity date on June 15, 2050. On January 12, 2022, Maison San Gabriel received an extra $1,850,000 loan from the SBA at 3.75% annual interest rate and the maturity date on June 15, 2050.
Revenue Recognition The Company adopted ASC Topic 606, Revenue from Contracts with Customers (“ASC Topic 606”), from May 1, 2020 using the modified retrospective transition approach to all contracts that did not have an impact on the beginning retained earnings on May 1, 2020.
The Company provided a reserve (reversal) for inventory shrinkage of $276,900 and $(5,961) for the years ended April 30, 2025 and 2024, respectively . 49 Revenue Recognition The Company adopted ASC Topic 606, Revenue from Contracts with Customers (“ASC Topic 606”), from May 1, 2020 using the modified retrospective transition approach to all contracts that did not have an impact on the beginning retained earnings on May 1, 2020.
Our existing four (4) supermarkets contributed $53.4 million in revenue during the year ended April 30, 2024, a decrease of approximately $2.0 million, as compared to the year ended April 30, 2023.
Our four California-based supermarkets contributed $46.1 million in revenue during the year ended April 30, 2025, a decrease of approximately $7.3 million, as compared to the year ended April 30, 2024.
For the year ended April 30, 2024, these three suppliers accounted for 15%, 7% and 26% of the Company’s total purchases, respectively. For the year ended April 30, 2023, three suppliers accounted for 20%, 14%, and 18% of the Company’s total purchases, respectively.
Produce and GF Distribution, Inc. For the year ended April 30, 2025, these five suppliers accounted for 11%, 7%, 7%, 5%, and 4% of the Company’s total purchases, respectively. For the year ended April 30, 2024, three suppliers accounted for 26%, 15% and 7% of the Company’s total purchases, respectively.
Net Revenue Our net revenues comprise gross revenues net of returns and discounts. We do not record sales taxes as a component of retail revenues as it is considered a pass-through conduit for collecting and remitting sales taxes. Gross Profit We calculate gross profit as net revenues less cost of revenues and occupancy costs.
The key measures that we use to evaluate the performance of our business are set forth below. Net Revenue Our net revenues comprise gross revenues net of returns and discounts. We do not record sales taxes as a component of retail revenues as it is considered a pass-through conduit for collecting and remitting sales taxes.
Additionally, if an “Event of Default” occurs, the outstanding principal amount will bear interest at the simple interest rate of 10 percent (10%) per annum, from the date of such Event of Default until all such sum are fully paid.
Additionally, if an “Event of Default” occurs, the outstanding principal amount will bear interest at the simple interest rate of 10 percent (10%) per annum, from the date of such Event of Default until all such sum are fully paid. 57 On June 10, 2024, Lee Lee filed a Statement of Conversion with the Arizona Corporation Commission (the “ACC”) converting Lee Lee Oriental Supermart, Inc. into Lee Lee Oriental Supermart, LLC, an Arizona limited liability company (the “Conversion”).
The Company collects security deposits and rent from these sub-lease tenants. The rent income collected from sub-lease tenants recognized as rental income and deducted occupancy cost. Recently Issued Accounting Pronouncements Please refer to Note 2 — “ Summary of significant accounting policies ” for details.
The Company collects security deposits and rent from these sub-lease tenants. The rent income collected from sub-lease tenants recognized as rental income and deducted occupancy cost.
Investing Activities Net cash used in investing activities was approximately $12.2 million for the year ended April 30, 2024, which mainly consisted of store renovation and purchase of equipment of $382,132, payment of intangible assets of $2.95 million, payment for investment into TMA Liquor Inc of $75,000, payment for 49% investment into Good Fortune Arcadia supermarket of approximately $1.8 million, and payment for acquisition of subsidiary Lee Lee of $7,000,000.
Net cash used in investing activities was approximately $10,132,834 for the year ended April 30, 2024, which mainly consisted of store renovation and purchase of equipment of $382,132, payment of intangible assets of $2,950,000, payment for investment into TMA Liquor Inc of $75,000, payment for 49% investment into Good Fortune Arcadia supermarket of $1,800,000, and payment for acquisition of subsidiary Lee Lee of $7,000,000, which was partly offset by cash acquired from acquisition of Lee-Lee of $2,074,298. 56 Financing Activities Net cash used in financing activities was approximately $5,818,814 for the year ended April 30, 2025, which mainly consisted of repayment for a note payable arising from the acquisition of Lee Lee of $9,484,005, which was partially offset by increase of bank overdraft of $1,349,202 and proceeds from a convertible note of $2,335,000.
Interest Income (Expense), Net Interest expense was $124,260 for the year ended April 30, 2024, an increase of $166,866, from interest income of $42,606 for the year ended April 30, 2023. For the year ended April 30, 2024, the interest expense was for the SBA Loans and the AFNB Loans.
Interest Income (Expense), Net Interest expense was $1,167,895 for the year ended April 30, 2025, an increase of $1,043,635 from $124,260 for the year ended April 30, 2024. For the year ended April 30, 2025, the interest expense was for the SBA loans and note payable arising from the acquisition of Lee Lee.
Cost of revenue includes the purchase price of consumer products, inbound and outbound shipping costs, including costs related to our sorting and delivery center, which is the warehouse attached to the El Monte store, and where we are the transportation service provider.
As a result, our gross profit and gross margin may not be comparable to similar data made available by our competitors. Cost of revenue includes the purchase price of consumer products, inbound and outbound shipping costs, including costs related to our sorting and delivery center, and where we are the transportation service provider.
Maison San Gabriel filed a genal denial in November 2023, and case management conference is scheduled for November 21, 2024. Off-Balance Sheet Arrangements The Company has guaranteed all of the loans described above, and Mr. John Xu, the Company’s CEO, Chairman and President, has personally guaranteed the loans with the SBA.
The management is not able to estimate the outcome of the case due to early stage of the case. Off-Balance Sheet Arrangements The Company has guaranteed all of the loans described above, and Mr. John Xu, the Company’s CEO, Chairman and President, has personally guaranteed the loans with the SBA.
By adding Dai Cheong to our portfolio, we will take the first step toward creating a vertically integrated supply-retail structure. Having an importer as a part of our portfolio will allow us the opportunity to offer a wider variety of products and to reap the benefits of preferred wholesale pricing.
By adding Dai Cheong to our portfolio, we will take the first step toward creating a vertically integrated supply-retail structure.
On June 27, 2023, we invested $1,440,000 for 40% equity interest in HKGF Market of Arcadia, LLC (“HKGF Arcadia”), a supermarket in the city of Arcadia, California, to further expands our footprint to new neighborhood. On December 6, 2023, we invested additional $360,000 for another 10% equity interest in HKGF Arcadia.
Having an importer as a part of our portfolio will allow us the opportunity to offer a wider variety of products and to reap the benefits of preferred wholesale pricing . 46 On June 27, 2023, we invested $1,440,000 for 40% equity interest in HKGF Market of Arcadia, LLC (“HKGF Arcadia”), a supermarket in the city of Arcadia, California, to further expand our footprint to new neighborhood.
ROU assets also include any lease payments made prior to commencement and are recorded net of any lease incentives received.
ROU assets also include any lease payments made prior to commencement and are recorded net of any lease incentives received. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that it will exercise such options.
How to Assess Our Performance In assessing performance, management considers a variety of performance and financial measures, including principal growth in net revenue, gross profit and selling, and general and administrative expenses. The key measures that we use to evaluate the performance of our business are set forth below.
Recently Issued Accounting Pronouncements Please refer to Note 2 — “ Summary of significant accounting policies ” for details. 50 How to Assess Our Performance In assessing performance, management considers a variety of performance and financial measures, including principal growth in net revenue, gross profit and selling, and general and administrative expenses.
Selling expenses mainly consist of advertising costs, promotion expenses, and payroll and related expenses for personnel engaged in selling and marketing activities.
Selling expenses mainly consist of advertising costs, promotion expenses, and payroll and related expenses for personnel engaged in selling and marketing activities. General and administrative expenses primarily consist of costs for corporate functions, including payroll and related expenses; facilities and equipment expenses, such as depreciation and amortization expense and rent; and professional fees and litigation costs.
Gross Profit and Gross Margin Years ended April 30, 2024 2023 Change Percentage Change Gross Profit $ 11,621,097 $ 12,451,160 $ (830,063 ) (6.7 )% Gross Margin 20.0 % 22.5 % (2.5 )% Gross profit was approximately $11.6 million and $12.5 million for the years ended April 30, 2024 and 2023, respectively.
Gross Profit and Gross Margin Nine Months Ended January 31, 2025 2024 Change Percentage Change Gross Profit $ 26,342,551 $ 11,621,097 $ 14,721,454 126.7 % Gross Margin 21.3 % 20.0 % - 1.3 % Gross profit was approximately $26.3 million and $11.6 million for the years ended April 30, 2025 and 2024, respectively.
On July 19, 2024, the Court ordered the Azad case stayed until a motion to dismiss is heard in the class action securities action. In May 2020, Maison El Monte was named as a co-defendant in a complaint filed by a consumer advocacy group alleging violations of a California health and safety regulation.
On July 19, 2024, the Court ordered the Azad case stayed until a motion to dismiss is heard in the class action securities action.
We have funded our working capital, operations and other capital requirements in the past primarily by equity contributions from shareholders, cash flow from operations, government grants, and bank loans. Cash is required to pay purchase costs for inventory, rental expenses, salaries, income taxes, other operating expenses and to repay debts.
In assessing its liquidity, management monitors and analyzes the Company’s cash on-hand, its ability to generate sufficient revenue sources in the future, and its operating and capital expenditure commitments. We have funded our working capital, operations and other capital requirements in the past primarily by equity contributions from shareholders, cash flow from operations, government grants, and bank loans.
As a result of the settlement agreement, the Company accrued $245,000 as a loss relating to the case as of April 30, 2024. On September 8, 2023, a complaint was filed by former employee against Maison San Gabriel for wrongful termination and labor law violation.
The Company is not able to make a reasonable estimate about the amount of contingent loss of these cases at current stage. 60 On September 8, 2023, a complaint was filed by former employee against Maison San Gabriel for wrongful termination and labor law violation. Maison San Gabriel filed a general denial in November 2023.
Total Operating Expenses Years ended April 30, 2024 2023 Change Percentage Change Selling Expenses $ 10,155,828 $ 8,479,578 $ 1,676,250 19.8 % General and Administrative Expenses 4,169,275 3,887,935 281,340 7.2 % Total Operating Expenses $ 14,325,103 $ 12,367,513 $ 1,957,590 15.8 % Percentage of revenue 24.7 % 22.3 % 2.4 % Total operating expenses were approximately $14.3 million for the year ended April 30, 2024, an increase of approximately $1.9 million, compared to approximately $12.4 million for the year ended April 30, 2023.
The increase in our gross profit was mainly due to the higher gross profit from our new acquired subsidiary Lee Lee. 52 Total Operating Expenses Years Ended April 30, 2025 2024 Change Percentage Change Selling Expenses $ 19,718,836 $ 10,155,828 $ 9,563,008 94.2 % General and Administrative Expenses 7,888,721 4,169,275 3,719,446 89.2 % Total Operating Expenses $ 27,607,557 $ 14,325,103 $ 13,282,454 92.7 % Percentage of revenue 22.3 % 24.7 % (2.3 )% Total operating expenses were approximately $27.6 million for the year ended April 30, 2025, an increase of approximately $13.3 million, compared to approximately $14.3 million for the year ended April 30, 2024.
On November 3, 2023, we incorporated a wholly-owned subsidiary AZLL LLC (“AZLL”) in Arizona.
On November 3, 2023, we incorporated a wholly-owned subsidiary, AZLL LLC (“AZLL”), in Arizona. On April 8, 2024, AZLL closed an acquisition transaction and purchased 100% of the equity interests in Lee Lee Oriental Supermart, Inc.
In addition, for the year ended April 30, 2024, we had cash outflow from 1) increased outstanding accounts receivable from related parties of $271,461, 2) increased prepayment to vendors of $1,716,468, 3) increased outstanding other receivables and other current assets of $474,943, 4) increased cash outflow on security deposit of $488,717, 5) payment for accounts payable of $59,633, and 6) payment of income tax payable of $518,516. 53 However, our net cash used in operating activities for the year ended April 30, 2024 was mainly offset by subtracting a non-cash adjustment from net loss for reversal of bad debt of $60,000, and increased cash inflow from 1) payment collected from accounts receivable of $203,481, 2) decrease of inventories of $0.9 million, 3) an increase of accounts payable to related parties of $106,725, 4) an increase of operating lease liabilities of $400,913, 5) an increase of accrued expenses and other payables of $342,592, 6) an increase of contract liabilities of $503,326 and 7) an increase of other long-term payables of $19,477.
In addition, for the year ended April 30, 2024, we had cash outflow from i) increased outstanding accounts receivable from related parties of $271,461, ii) increased prepayment to vendors of $1,716,468, iii) increased outstanding other receivables and other current assets of $474,943, iv) increased cash outflow on security deposit of $488,717, v) payment for accounts payable of $59,633, and vi) payment of income tax payable of $518,516.
Income Taxes Provisions Income tax expense was $440,562 for the year ended April 30, 2024, an increase of $104,076, from income taxes expense of $336,486 for the year ended April 30, 2023.
The AFNB loans were repaid in full as of April 30, 2024. 53 Income Taxes Provisions Income tax expense was $173,989 for the year ended April 30, 2025, a decrease of $266,573 from income taxes expense of $440,562 for the year ended April 30, 2024.
Maison El Monte received an extra $350,000 from the SBA at 3.75% annual interest rate and the maturity date on June 15, 2050. As of April 30, 2024 and 2023, the Company’s aggregate balance on the three SBA loans was $2,561,299 and $2,624,329, respectively.
As of April 30, 2025 and 2024, the Company’s aggregate balance on the three SBA loans was $2,616,050 and $2,561,299, respectively.
As of April 30, 2024, the Company had outstanding loan facilities of approximately $2.56 million SBA loan and $15.1 million secured senior note payable due to acquisition of Lee Lee. In assessing its liquidity, management monitors and analyzes the Company’s cash on-hand, its ability to generate sufficient revenue sources in the future, and its operating and capital expenditure commitments.
As of April 30, 2025, the Company had outstanding loan facilities of approximately $2.62 million SBA loans, $5.64 million secured senior note payable due to the acquisition of Lee Lee, and $3.00 million convertible note payable.
This was mainly attributable to the reasons discussed above, which included a decrease in gross profit by $830,063, decreased other income by $1,429,193, increased investment loss from equity method investment by $538,542, increased operating expenses by $1,957,590 and increased income tax expense by $104,076, which was partly offset by increased net loss attribute to noncontrolling interest by $434,321.
This was mainly attributable to the reasons discussed above, which included an increase in gross profit by $14,721,454 mainly from Lee Lee store, and increased other income by $3,623,198, which was partly offset by increased interest expenses by $1,043,635, and increased operating expenses by $13,282,454.
The increase in general and administrative expenses during the year ended April 30, 2024 was primarily due to increased office expenses of approximately $459,270, increased professional fee by $231,645 and increased amortization expense of $156,475 due to the new trademark acquired through the acquisition of Lee Lee, which was partly offset by decreased bad debt expenses by $359,035, decreased insurance expense by $31,609, decreased repair and maintenance expense by $71,797, and decrease other miscellaneous expenses by $103,611. 51 Other Income (Expenses), Net Other expenses was $118,201 for the year ended April 30, 2024 compare to other income of $1,849,534 for the year ended April 30, 2023.
The increase in general and administrative expenses during the year ended April 30, 2025 was primarily due to increased office expenses of approximately $554,386, increased professional fees by $1.2 million, increased amortization expense by $390,681 due to the new trademark acquired through the acquisition of Lee Lee, increased insurance expense by $403,442, increased repair and maintenance expense by $648,967, and increased office expenses and supplies by $582,033.
Commitments and Contractual Obligations The following table presents the Company’s material contractual obligations as of April 30, 2024: Contractual Obligations Total Less than 1 year 1–3 years 3–5 years Thereafter Senior secured note payable $ 15,126,065 $ 15,126,065 $ — $ — $ — SBA loan 2,561,299 65,098 136,714 145,969 2,213,518 Operating lease obligations and others 43,103,930 2,153,850 4,889,153 4,099,512 31,961,415 $ 60,791,294 $ 17,345,013 $ 5,025,867 $ 4,245,481 $ 34,174,933 55 Contingencies The Company is otherwise periodically involved in various legal proceedings that are incidental to the conduct of its business, including, but not limited to, employment discrimination claims, customer injury claims, and investigations.
During any such period, the Company will not be in default of satisfying the Effectiveness Deadline. 59 Commitments and Contractual Obligations The following table presents the Company’s material contractual obligations as of January 31, 2025: Contractual Obligations Total Less than 1 year 1–3 years 3–5 years Thereafter Senior secured note payable $ 5,642,060 $ 4,887,094 $ 754,966 $ — $ — SBA loans 2,616,050 62,212 124,424 124,424 2,304,990 Convertible note payable 3,000,000 — 3,000,000 — — Operating lease obligations and others * 38,648,721 3,471,193 7,009,955 5,431,238 22,736,335 $ 49,906,831 $ 8,420,499 $ 10,889,345 $ 5,555,662 $ 25,041,325 * exclude the lease of Maison El Monte as a result of the lease early termination on June 7, 2025 Contingencies The Company is otherwise periodically involved in various legal proceedings that are incidental to the conduct of its business, including, but not limited to, employment discrimination claims, customer injury claims, and investigations.
Net cash provided by operating activities was approximately $0.5 million for the year ended April 30, 2023 and was mainly comprised of net income of approximately $1.6 million, add-back of non-cash adjustments to net income including depreciation and amortization expense of approximately $0.4 million, and bad debt expense of $0.2 million.
However, our net cash used in operating activities for the year ended April 30, 2024 was partly offset by deducting non-cash adjustments from net loss for reversal of bad debt of $60,000 and reversal of inventory impairment of $5,961.
Removed
We spent $201,608 for the year ended April 30, 2024 for repairs and maintenance and supermarket renovation, a decrease of $71,797 compared to $273,405 for the year ended April 30, 2023.
Added
On December 6, 2023, we invested an additional $360,000 for another 10% equity interest in HKGF Arcadia.
Removed
Going concern The accompanying consolidated financial statements were prepared assuming the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. For the year ended April 30, 2024, the Company had a net loss of approximately $3.34 million.
Added
Lee Lee is a three-store supermarket chain operating in Arizona under the name Lee Lee International Supermarkets and specializing in ethnic groceries.
Removed
The Company had an accumulated deficit of approximately $2.82 million as of April 30, 2024, and negative cash flow from operating activities of approximately $3.50 million for the year ended April 30, 2024. The historical operating results including recurring losses from operations raise substantial doubt about the Company’s ability to continue as a going concern.
Added
On June 7, 2025, Maison EL Monte, Inc. entered into a lease termination agreement the lessor, pursuant to the agreement, the lessee Maison El Monte agreed to pay the lessor a total sum of One Hundred Thousand Dollars ($100,000) as consideration for the lessor’s agreement to terminate the lease and release the lessee from all obligations and liabilities under the lease, including, but not limited to, any outstanding rent.

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