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What changed in NOCERA, INC.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of NOCERA, INC.'s 2023 and 2024 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 2024 report.

+225 added−204 removedSource: 10-K (2025-05-06) vs 10-K (2024-04-01)

Top changes in NOCERA, INC.'s 2024 10-K

225 paragraphs added · 204 removed · 168 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

35 edited+12 added−4 removed48 unchanged
Biggest changeCompetition The market for aquaculture projects and services is highly competitive. Many of the producers and sellers are large entities that have significantly greater resources than we have. We also compete with small suppliers which provide smaller alternative aquaculture solutions regionally but due to the size of our projects, we believe that we should have a better price point.
Biggest changeWe also compete with small suppliers which provide smaller alternative aquaculture solutions regionally but due to the size of our projects, we believe that we should have a better price point. Trademarks and Patents We do not own any trademarks or patents. Sales and Marketing We continue to market our brand by offering unique and better incentives to the consumers.
Nocera Land-based RASs Overview Height / width 1.5m/10m Main composition of our tank Environmental-friendly PE Yield per growing season (Tilapia) 11,000 lbs. Fish farming density 100-109 lb./m3 Price per RASs Total Solution $35,000 USD 3 Our RASs can raise both freshwater and saltwater fish, as well as a variety of crustaceans.
Nocera Land-based RASs Overview Height / width 1.5m/10m Main composition of our tank Environmental-friendly PE Yield per growing season (Tilapia) 11,000 lbs. Fish farming density 100-109 lb./m3 Price per RASs Total Solution $35,000 USD Our RASs can raise both freshwater and saltwater fish, as well as a variety of crustaceans.
Our primary business operations currently consist of designing, developing and producing large scale recirculating aquaculture systems ("RASs") for fish farms along with providing consulting, technology transfer and aquaculture project management services to new and existing aquaculture management business services. RASs operate by filtering water from the fish (or shellfish) tanks so it can be reused within the tank.
Our primary business operations currently consist of designing, developing and producing large scale recirculating aquaculture systems (“RASs”) for fish farms along with providing consulting, technology transfer and aquaculture project management services to new and existing aquaculture management business services. RASs operate by filtering water from the fish (or shellfish) tanks so it can be reused within the tank.
NTB currently procures and sells eel in Taiwan and plans to trade other types of seafood, such as tilapia and milkfish, in the near future. On September 7, 2022, we entered into a series of contractual agreements with the majority stockholder of Meixin and Meixin, of which we purchased 80% controlling interest of Meixin for $4,300,000.
NTB currently procures and sells eel in Taiwan and plans to trade other types of seafood, such as tilapia and milkfish, in the near future. 3 On September 7, 2022, we entered into a series of contractual agreements with the majority stockholder of Meixin and Meixin, of which we purchased 80% controlling interest of Meixin for $4,300,000.
In addition to utilizing Meixin's distribution channel, we will move towards online marketing as well to achieve a greater market share. Manufacturing Operations Currently, we manufacture RASs through our branch office in Taiwan and may manufacture RASs through our Chinese subsidiaries. Additionally, we provide consulting services regarding RAS technology transfer and aquaculture project management services to customers in Taiwan.
In addition to utilizing Meixin’s distribution channel, we will move towards online marketing as well to achieve a greater market share. 6 Manufacturing Operations Currently, we manufacture RASs through our branch office in Taiwan and may manufacture RASs through our Chinese subsidiaries. Additionally, we provide consulting services regarding RAS technology transfer and aquaculture project management services to customers in Taiwan.
XFC Sale On December 31, 2020, we exchanged 466,667 (post-split) shares of our restricted common stock to stockholders of Xin Feng Construction Co., Ltd., a Taiwan limited liability company ("XFC"), in exchange for 100% controlling interest in XFC.
XFC Sale On December 31, 2020, we exchanged 466,667 (post-split) shares of our restricted common stock to stockholders of Xin Feng Construction Co., Ltd., a Taiwan limited liability company (“XFC”), in exchange for 100% controlling interest in XFC.
Nocera Recirculating Aquaculture System Market Overview Global fish consumption has long been on the rise at a rate higher than any other source of animal protein, and the trend is expected to continue.
Nocera Recirculating Aquaculture System 4 Market Overview Global fish consumption has long been on the rise at a rate higher than any other source of animal protein, and the trend is expected to continue.
Advertising of our products is subject to such regulation pursuant to the Federal Trade Commission Act and the regulations promulgated thereunder. We are also subject to certain health and safety regulations, including regulations issued pursuant to the Occupational Safety and Health Act.
Advertising of our products is subject to such regulation pursuant to the Federal Trade Commission Act and the regulations promulgated thereunder. 7 We are also subject to certain health and safety regulations, including regulations issued pursuant to the Occupational Safety and Health Act.
Seasonality Since the global growing demand from aquaculture production along with the decreasing production from wild fisheries and our fish farming systems provide a controlled and traceable environment for species, our business rarely suffers a seasonal impact. Human Capital Resources As of December 31, 2023, we had a total of 22 employees, including 19 full-time employees and 3 part-time employees.
Seasonality Since the global growing demand from aquaculture production along with the decreasing production from wild fisheries and our fish farming systems provide a controlled and traceable environment for species, our business rarely suffers a seasonal impact. Human Capital Resources As of December 31, 2024, we had a total of 22 employees, including 19 full-time employees and 3 part-time employees.
Also, with respect to the potential sale of eel and any other seafood into the United States, we are subject to extensive regulation, including, among other things, the Food, Drug and Cosmetic Act, as amended by the Food Safety Modernization Act ("FSMA"), the Public Health Security and Bioterrorism Preparedness and Response Act of 2002, and the rules and regulations promulgated thereunder by the U.S.
Also, with respect to the potential sale of eel and any other seafood into the United States, we are subject to extensive regulation, including, among other things, the Food, Drug and Cosmetic Act, as amended by the Food Safety Modernization Act (“FSMA”), the Public Health Security and Bioterrorism Preparedness and Response Act of 2002, and the rules and regulations promulgated thereunder by the U.S.
We are aiming for the direct wholesale option, including live hauling, restaurants, supermarkets and specialty stores. As of December 2023, we sell our food items, including our signature seafood porridge bowl, through our flagship bento box store located at the Ning Xia Night Market in the Datong District of Taipei City, Taiwan.
We are aiming for the direct wholesale option, including live hauling, restaurants, supermarkets and specialty stores. As of December 2024, we sell our food items, including our signature seafood porridge bowl, through our flagship bento box store located at the Ning Xia Night Market in the Datong District of Taipei City, Taiwan.
There are several significant benefits to our RASs: · the system provides a controlled and "traceable" environment; · the recirculating aquaculture system can be installed almost anywhere and requires minimal site preparation; and · it benefits local economies by providing fresher and, therefore, generally healthier fish. Nocera's RASs include the fish tank, circulation and filtration systems.
There are several significant benefits to our RASs: · the system provides a controlled and “traceable” environment; · the recirculating aquaculture system can be installed almost anywhere and requires minimal site preparation; and · it benefits local economies by providing fresher and, therefore, generally healthier fish. Nocera’s RASs include the fish tank, circulation and filtration systems.
Food and Drug Administration (the "FDA"). The FSMA was enacted in order to aid the effective prevention of food safety issues in the food supply. This comprehensive and evolving regulatory program impacts how food is grown, packed, processed, shipped and imported into the United States and it governs compliance with Good Manufacturing Practices regulations.
Food and Drug Administration (the “FDA”). The FSMA was enacted in order to aid the effective prevention of food safety issues in the food supply. This comprehensive and evolving regulatory program impacts how food is grown, packed, processed, shipped and imported into the United States and it governs compliance with Good Manufacturing Practices regulations.
The closing of the XFC Sale occurred on November 30, 2022 and the XFC variable interest entity ("VIE") agreements were terminated in connection with the XFC Sale.
The closing of the XFC Sale occurred on November 30, 2022 and the XFC variable interest entity agreements were terminated in connection with the XFC Sale.
We believe that the RASs, with its proven advantage in producing more fish in a more cost-effective and environmentally friendly manner while offering greater location flexibility and the potential for a "solar-fish sharing mode," is a perfect solution to address the opportunities highlighted above.
We believe that the RASs, with its proven advantage in producing more fish in a more cost-effective and environmentally friendly manner while offering greater location flexibility and the potential for a “solar-fish sharing mode,” is a perfect solution to address the opportunities highlighted above.
The reports filed with the SEC by our executive officers and directors pursuant to Section 16 under the Exchange Act are also made available, free of charge on our website, as soon as reasonably practicable after copies of those filings are provided to us by those persons. These materials can be accessed through the "Investor Relations" section of our website.
The reports filed with the SEC by our executive officers and directors pursuant to Section 16 under the Exchange Act are also made available, free of charge on our website, as soon as reasonably practicable after copies of those filings are provided to us by those persons. These materials can be accessed through the “Investor Relations” section of our website.
On November 30, 2022, we entered into a Purchase of Business Agreement with Han-Chieh Shih (the "Purchaser"), in which we sold our controlling interest of XFC, to the Purchaser for a total purchase cash price of $300,000 (the "XFC Sale").
On November 30, 2022, we entered into a Purchase of Business Agreement with Han-Chieh Shih (the “Purchaser”), in which we sold our controlling interest of XFC, to the Purchaser for a total purchase cash price of $300,000 (the “XFC Sale”).
In January 2021, we moved our operation and market focus from China to Taiwan. In 2021, we established a Nocera Taiwan Branch to focus on customers in a variety of sectors, such as individual investors, government supported or funded companies, and international customers. We have received interest from areas like Japan, Thailand, Jordan, South Africa and the United States.
In 2021, we established a Nocera Taiwan Branch to focus on customers in a variety of sectors, such as individual investors, government supported or funded companies, and international customers. We have received interest from areas like Japan, Thailand, Jordan, South Africa and the United States.
The VIE Agreements with Meixin On September 7, 2022, we entered into a series of contractual agreements (collectively, the "Meixin VIE Agreements") with the majority stockholder (the "Selling Stockholder") of Meixin Institutional Food Development Co., Ltd., a Taiwan corporation and a food processing and catering company ("Meixin"), and Meixin, of which we purchased 80% controlling interest of Meixin for $4,300,000.
The VIE Agreements with Meixin On September 7, 2022, we entered into a series of contractual agreements (collectively, the “Meixin VIE Agreements”) with the majority stockholder (the “Selling Stockholder”) of Meixin Institutional Food Development Co., Ltd., a Taiwan corporation and a food processing and catering company (“Meixin”), and Meixin, of which we purchased 80% controlling interest of Meixin for $4,300,000.
We currently provide such services in Taiwan and intend to expand into other international markets and the United States to increase revenues and operate more efficiently. 4 We provide the following service offerings: · for qualified investors or investment groups who are interested in capitalizing on the potential of the aquaculture industry and want to develop or take part in commercial fish farming or shrimp farming but lack the experience, design, installation, build and management of aquaculture projects to meet these interests; · a full range of pilot and management services to aquaculture companies and new aquaculture projects throughout Taiwan and potentially the rest of the world, providing tailored solutions to meet customer needs and to fulfill our commitment, to encourage and support clean water and clean fish products from the fish farm to the table; and · select equipment and materials from suppliers to provide unique service offerings structured to generate higher profit margins.
We provide the following service offerings: · for qualified investors or investment groups who are interested in capitalizing on the potential of the aquaculture industry and want to develop or take part in commercial fish farming or shrimp farming but lack the experience, design, installation, build and management of aquaculture projects to meet these interests; · a full range of pilot and management services to aquaculture companies and new aquaculture projects throughout Taiwan and potentially the rest of the world, providing tailored solutions to meet customer needs and to fulfill our commitment, to encourage and support clean water and clean fish products from the fish farm to the table; and · select equipment and materials from suppliers to provide unique service offerings structured to generate higher profit margins.
During the year ended December 31, 2023 and 2022, the net sales were approximately $23.9 million and approximately $14.1 million, respectively. Construction Services Prior to terminating the VIE agreements with XFC in connection with the XFC Sale, we were the only provider of RAS solar power energy sharing and construction services in Taiwan.
During the year ended December 31, 2024 and 2023, the net sales were approximately $17.01 million and approximately $23.9 million, respectively. Construction Services Prior to terminating the variable interest entity agreements with XFC in connection with the XFC Sale, we were the only provider of RAS solar power energy sharing and construction services in Taiwan.
Customers In 2023, we targeted customers in a variety of markets (e.g., Japan, Taiwan, Thailand, Jordan, South Africa and the United States), such as individual investors, government supported or funded companies and other types of international customers.
Customers In 2024, we targeted customers in a variety of markets (e.g., Japan, Taiwan, Thailand, Jordan, South Africa and the United States), such as individual investors, government supported or funded companies and other types of international customers. During the year ended December 31, 2024 and 2023, the net sales were approximately $17.01 million and approximately $23.9 million, respectively.
In addition, it is possible that certain governments may seek to block or limit our products and services or otherwise impose other restrictions that may affect the accessibility or usability of any or all of our products and services for an extended period of time or indefinitely. 6 Our properties and operations are subject to a number of environmental, health and safety laws and regulations in each of the jurisdictions in which we operate.
In addition, it is possible that certain governments may seek to block or limit our products and services or otherwise impose other restrictions that may affect the accessibility or usability of any or all of our products and services for an extended period of time or indefinitely.
We believe that we have skills to help our customers obtain all necessary licenses, registrations and permits to comply with all requirements necessary to allow our customers and investors to conduct aquaculture business in Taiwan.
We believe that we have skills to help our customers obtain all necessary licenses, registrations and permits to comply with all requirements necessary to allow our customers and investors to conduct aquaculture business in Taiwan. Listing on The Nasdaq Capital Market Our common stock is listed on The Nasdaq Capital Market under the symbol “NCRA” since August 11, 2022.
We may from time to time become a party to various legal or administrative proceedings arising in the ordinary course of our business. Property We own 229 contiguous acres of land located in Montgomery County, Alabama up to the date of this Annual Report on Form 10-K.
Property We own 229 contiguous acres of land located in Montgomery County, Alabama up to the date of this Annual Report on Form 10-K.
Both GSI and GZ GZT are currently dormant and do not conduct any operations. We currently do not conduct any operations in China or Hong Kong. In December 2020, we added XFC as a VIE in order to obtain a Class A construction license to construct indoor RASs and solar sharing fish farms.
In December 2020, we added XFC as a VIE in order to obtain a Class A construction license to construct indoor RASs and solar sharing fish farms.
We are not directly involved in the production or manufacturing of readily available equipment, and we do not take a risk in the repair and maintenance of the equipment because of the manufacturer's maintenance policy. We have identified and sourced multiple suppliers in Taiwan, and our relationships with suppliers are generally good.
Suppliers We purchase raw materials and parts and equipment from third parties locally in Taiwan and build and sell them to customers. We are not directly involved in the production or manufacturing of readily available equipment, and we do not take a risk in the repair and maintenance of the equipment because of the manufacturer’s maintenance policy.
We expect that our suppliers will be able to meet the anticipated demand for our products in the foreseeable future. There can be no assurance that our suppliers will continue to meet our needs, particularly as we ramp up our expansion into the U.S. and other markets around the world.
There can be no assurance that our suppliers will continue to meet our needs, particularly as we ramp up our expansion into the U.S. and other markets around the world. Competition The market for aquaculture projects and services is highly competitive. Many of the producers and sellers are large entities that have significantly greater resources than we have.
Listing on The Nasdaq Capital Market Our common stock is listed on The Nasdaq Capital Market under the symbol "NCRA" since August 11, 2022. 7 Legal Proceedings We are currently not a party to any legal or administrative proceedings and are not aware of any pending or threatened legal or administrative proceedings against us in all material aspects.
Legal Proceedings We are currently not a party to any legal or administrative proceedings and are not aware of any pending or threatened legal or administrative proceedings against us in all material aspects. We may from time to time become a party to various legal or administrative proceedings arising in the ordinary course of our business.
During the year ended December 31, 2023 and 2022, the net sales were approximately $23.9 million and approximately $141 million, respectively. ______________________ ] Ranganathan et al, How to Sustainably Feed 10 Billion People by 2050, in 21 Charts , WORLD RESOURCES INSTITUTE (Dec. 5, 2018); https://www.wri.org/insights/how-sustainably-feed-10-billion-people-2050-21-charts#:~:text= How%20to%20Sustainably%20Feed%2010%20Billion%20People%20by%202050%2C%20in%2021%20Charts,-December%205%2C%202018&text=There%20is%20a%20big%20shortfall,than%20there%20were%20in%202010. 5 Suppliers We purchase raw materials and parts and equipment from third parties locally in Taiwan and build and sell them to customers.
We plan to go global through building demo sites promoting our RASs and selling our price-competitive systems in these countries to meet their demand for food and to satisfy their desire for a greener environment. ______________________ ] Ranganathan et al, How to Sustainably Feed 10 Billion People by 2050, in 21 Charts , WORLD RESOURCES INSTITUTE (Dec. 5, 2018); https://www.wri.org/insights/how-sustainably-feed-10-billion-people-2050-21-charts#:~:text= How%20to%20Sustainably%20Feed%2010%20Billion%20People%20by%202050%2C%20in%2021%20Charts,-December%205%2C%202018&text=There%20is%20a%20big%20shortfall,than%20there%20were%20in%202010. 5 In January 2021, we moved our operation and market focus from China to Taiwan.
The Meixin VIE Agreements essentially confer control and management of Meixin as well as substantially all of the economic benefits of the Selling Stockholder in Meixin to us.
The Meixin VIE Agreements essentially confer control and management of Meixin as well as substantially all of the economic benefits of the Selling Stockholder in Meixin to us. The VIE Agreements with Xinca On January 31, 2024, we entered into a Variable Interest Entity Purchase Agreement (“Xinca Purchase Agreement”) with Zhejiang Xinca Mutual Entertainment Culture Media Co., Ltd.
Prior to the merger, we were a "shell company" as defined under Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the "Exchange Act). GSI is the parent holding company of GZ GST, which was incorporated on November 13, 2018, as a wholly foreign-owned enterprise established in the PRC.
GSI is the parent holding company of GZ GST, which was incorporated on November 13, 2018, as a wholly foreign-owned enterprise established in the PRC. Both GSI and GZ GZT are currently dormant and do not conduct any operations. We currently do not conduct any operations in China or Hong Kong.
Our equipment enhances the management of fish farms by reducing the incidence of disease among the fish populations, while reducing water pollution from inland fish farms.
Our equipment enhances the management of fish farms by reducing the incidence of disease among the fish populations, while reducing water pollution from inland fish farms. We currently provide such services in Taiwan and intend to expand into other international markets and the United States to increase revenues and operate more efficiently.
Like Taiwan, there are also many countries with a growing population and growing demand for high-protein food. We plan to go global through building demo sites promoting our RASs and selling our price-competitive systems in these countries to meet their demand for food and to satisfy their desire for a greener environment.
Like Taiwan, there are also many countries with a growing population and growing demand for high-protein food.
Therefore, in accordance with ASC 810 "Consolidation," we are considered the primary beneficiary of Meixin and have consolidated Meixin's assets, liabilities, results of operations, and cash flows in the accompanying consolidated financial statements. Significant Products & Services We manufacture, sell, and install RASs for land-based fish farms. Originally, our systems were designed and constructed from used marine shipping containers.
Therefore, in accordance with ASC 810 “Consolidation,” we are considered the primary beneficiary of Meixin and have consolidated Meixin’s assets, liabilities, results of operations, and cash flows in the accompanying consolidated financial statements. On January 4, 2024 we established Shanghai Nocera Culture Co., Ltd. (“Shanghai Nocera”) and combined Xinca for the e-commerce business in China.
Removed
Business Developments The following highlights recent material developments in our business: · On November 1, 2023, we announced that the Board appointed Yiwen Zhang and Song-Yuan Teng to the Board, with Yiwen Zhang serving on the Audit Committee of the Board and the Nominating and Corporate Governance Committee of the Board, as well as Chairman of the Audit Committee of the Board.
Added
(“Xinca”), a domestic funded limited liability company registered in the PRC. The Xinca Purchase Agreement was entered into by our wholly-owned subsidiary and foreign enterprise, Shanghai Nocera Culture Co., Ltd. (“WFOE”), through a series of contractual agreements (“Xinca VIE Agreements”), in which we exchanged 1,800,000 shares of our restricted common stock for a 100% controlling interest in Xinca.
Removed
Recent Developments · On July 5, 2023, issued 325,708 shares of common stock in response to the exercise of 162,854 shares of warrants issued to our representative in our uplisting in August 2022 with gross proceeds of $626,987. 2 Corporate Structure We conduct our operations through (i) Meixin; and (ii) Nocera Taiwan Branch, an unincorporated division of the Company ("NTB").
Added
As a result, the Company has been determined to be the primary beneficiary of Xinca and Xinca became a variable interest entity of the Company. The Equity Purchase Agreements with SY Culture On April 14, 2024, we entered into an Equity Purchase Agreement with Hangzhou SY Culture Media Co. Ltd.
Removed
Our other subsidiaries, GSI, which wholly-owns GZ GST, are dormant and currently do not have any operations. However, GZ GST may be involved with RASs manufacturing in the near future. We acquired GSI in a reverse merger on December 31, 2018.
Added
(“SY Culture Purchase Agreement”), a domestic funded limited liability company registered in the PRC.
Removed
Trademarks and Patents We do not own any trademarks or patents. Sales and Marketing We continue to market our brand by offering unique and better incentives to the consumers.
Added
The SY Culture Purchase Agreement was entered into by our wholly-owned subsidiary and foreign enterprise, Gui Zhou Grand Smooth Technology Ltd., in which we issued 600,000 shares of our restricted common stock for a 100% equity in SY Culture. 2 Nasdaq We received a deficiency letter (the “Nasdaq Letter”) from Nasdaq notifying us that, for the 30 consecutive business days from November 29, 2024 through January 14, 2025, the closing bid price of our common stock had not been maintained at the minimum required closing bid price of at least $1.00 per share, as required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”).
Added
In accordance with the listing rules of Nasdaq, we have been given 180 calendar days, or until July 14, 2025 (the “Compliance Date”), to regain compliance with the Bid Price Rule. If we are unable to regain compliance prior to the Compliance Date, we may be eligible for an additional 180 calendar days to satisfy the Bid Price Rule.
Added
To qualify, we will be required to meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for The Nasdaq Capital Market with the exception of the Bid Price Rule, and will need to provide written notice of our intention to cure the deficiency during such additional compliance period, by effecting a reverse stock split, if necessary.
Added
The Nasdaq Letter does not result in the immediate delisting of our common stock and our common stock will continue to trade uninterrupted on The Nasdaq Capital Market under the symbol “NCRA.” Business Developments The following highlights recent material developments in our business: · On January 4, 2024, we announced that the Board appointed Feng-Hua Chen as the Chief Operating Officer. · On January 31, 2024, we entered into the Xinca VIE Agreements with the majority shareholder of Xinca. · On April 14, 2024, we entered into Equity Purchase Agreement with SY Culture. · On October 16, 2024, we engaged with Enrome LLP and appoint the New Auditor as our independent registered public accounting firm.
Added
Corporate Structure We conduct our operations through (i) Nocera Taiwan Branch; (ii) Meixin; (iii) Xinca; and (iv) SY Culture, an unincorporated division of the Company (“NTB”). Our other subsidiaries, Meixin, located in Taipei City, Taiwan, Shanghai Nocera Culture Co., Ltd. , which wholly owns Xinca, and GSI, which wholly-owns GZ GST and SY Culture.
Added
Both Xinca and SY Culture are located in Hangzhou, China. We acquired GSI in a reverse merger on December 31, 2018. Prior to the merger, we were a “shell company” as defined under Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the “Exchange Act).
Added
On April 14, 2024, GZ GST entered into Equity Purchase Agreement with SY Culture to expend the e-commerce business, specifically with foods and kitchen goods retail channel. Significant Products & Services We manufacture, sell, and install RASs for land-based fish farms. Originally, our systems were designed and constructed from used marine shipping containers.
Added
We have identified and sourced multiple suppliers in Taiwan, and our relationships with suppliers are generally good. We expect that our suppliers will be able to meet the anticipated demand for our products in the foreseeable future.
Added
Our properties and operations are subject to a number of environmental, health and safety laws and regulations in each of the jurisdictions in which we operate.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

65 edited+17 added−19 removed175 unchanged
Biggest changeThe trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. Several analysts may cover our stock. If one or more of those analysts downgrade our stock or publish inaccurate or unfavorable research about our business, our stock price would likely decline.
Biggest changeIf securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline. The trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. Several analysts may cover our stock.
However, in the event the equity holders of our VIE breach the terms of these contractual arrangements and voluntarily liquidate our VIE, or our VIE declares bankruptcy and all or part of its assets become subject to liens or rights of third-party creditors, or are otherwise disposed of without our consent, we may be unable to operate some or all of our business or otherwise benefit from the assets held by our VIE, which could have a material adverse effect on our business, financial condition, and results of operations.
However, in the event the equity holders of our applicable VIE breach the terms of these contractual arrangements and voluntarily liquidate our VIE, or our VIE declares bankruptcy and all or part of its assets become subject to liens or rights of third-party creditors, or are otherwise disposed of without our consent, we may be unable to operate some or all of our business or otherwise benefit from the assets held by our VIE, which could have a material adverse effect on our business, financial condition, and results of operations.
In 2019, we did not have a corporate bank account established in Hong Kong or the U.S., and certain funds that were supposed to be deposited into such corporate bank account were instead deposited into the personal bank account of our former Chairman of the Board of Directors of the Company ("Board"), President, Chief Executive Officer and Director, Yin-Chieh Cheng, which was considered to be a personal loan made by us to Yin-Chieh Cheng and may have violated Section 13(k) of the Exchange Act.
In 2019, we did not have a corporate bank account established in Hong Kong or the U.S., and certain funds that were supposed to be deposited into such corporate bank account were instead deposited into the personal bank account of our former Chairman of the Board of Directors of the Company (“Board”), President, Chief Executive Officer and Director, Yin-Chieh Cheng, which was considered to be a personal loan made by us to Yin-Chieh Cheng and may have violated Section 13(k) of the Exchange Act.
Since the laws of Taiwan limit foreign equity ownership in certain businesses in Taiwan, we operate such business in Taiwan through our VIE (variable interest entity), Meixin Institutional Food Development Co., Ltd., a Taiwan corporation ("Meixin"), in which we have no ownership interest and rely on a series of contractual arrangements with Meixin and its respective equity holders to control and operate the VIE.
Since the laws of Taiwan limit foreign equity ownership in certain businesses in Taiwan, we operate such business in Taiwan through our VIE (variable interest entity), Meixin Institutional Food Development Co., Ltd., a Taiwan corporation (“Meixin”), in which we have no ownership interest and rely on a series of contractual arrangements with Meixin and its respective equity holders to control and operate the VIE.
As a result, the value of your investment in us may fluctuate. The trading prices of our common stock could be volatile and could decline following this offering at a time when you want to sell your holdings. Numerous factors, many of which are beyond our control, may cause the trading prices of our common stock to fluctuate significantly.
As a result, the value of your investment in us may fluctuate. 22 The trading prices of our common stock could be volatile and could decline following this offering at a time when you want to sell your holdings. Numerous factors, many of which are beyond our control, may cause the trading prices of our common stock to fluctuate significantly.
We will be delisted and our securities will be prohibited from being traded on The Nasdaq Stock Market LLC ("Nasdaq") or any other national securities exchange or the over-the-counter trading market if we remain identified as a Commission-Identified Issuer for three consecutive years (or two if the AHFCAA is enacted).
We will be delisted and our securities will be prohibited from being traded on The Nasdaq Stock Market LLC (“Nasdaq”) or any other national securities exchange or the over-the-counter trading market if we remain identified as a Commission-Identified Issuer for three consecutive years (or two if the AHFCAA is enacted).
Furthermore, if our VIE undergoes a voluntary or involuntary liquidation proceeding, its equity holders or unrelated third-party creditors may claim rights to some or all of the assets of our VIE, thereby hindering our ability to operate our business as well as constrain our growth.
Furthermore, if our applicable VIE undergoes a voluntary or involuntary liquidation proceeding, its equity holders or unrelated third-party creditors may claim rights to some or all of the assets of our VIE, thereby hindering our ability to operate our business as well as constrain our growth.
On December 2, 2021, the SEC adopted final amendments implementing the disclosure and submission requirements under the HFCAA, pursuant to which the SEC will identify a "Commission-Identified Issuer" if an issuer has filed an annual report containing an audit report issued by a registered public accounting firm that the PCAOB has determined it is unable to inspect or investigate completely because of a position taken by an authority in the foreign jurisdiction, and will then impose a trading prohibition on an issuer after it is identified as and remains a Commission-Identified Issuer for three consecutive years.
On December 2, 2021, the SEC adopted final amendments implementing the disclosure and submission requirements under the HFCAA, pursuant to which the SEC will identify a “Commission-Identified Issuer” if an issuer has filed an annual report containing an audit report issued by a registered public accounting firm that the PCAOB has determined it is unable to inspect or investigate completely because of a position taken by an authority in the foreign jurisdiction, and will then impose a trading prohibition on an issuer after it is identified as and remains a Commission-Identified Issuer for three consecutive years.
Our Articles of Incorporation and our amended and restated bylaws ("Bylaws") eliminate the personal liability of our directors and officers to us and our stockholders for damages for breach of fiduciary duty as a director or officer to the extent permissible under Nevada law.
Our Articles of Incorporation and our amended and restated bylaws (“Bylaws”) eliminate the personal liability of our directors and officers to us and our stockholders for damages for breach of fiduciary duty as a director or officer to the extent permissible under Nevada law.
Without our VIE, and if we are unable to maintain the license that is necessary for us to conduct our operations in Taiwan or fail to obtain any other required licenses, we will be unable to operate in Taiwan.
Without our applicable VIE, and if we are unable to maintain the license that is necessary for us to conduct our operations in Taiwan or fail to obtain any other required licenses, we will be unable to operate in Taiwan.
While we have no specific plan to issue preferred stock in different series, our amended and restated articles of incorporation, as amended ("Articles of Incorporation") authorizes us to issue, without the approval of our stockholders, one or more series of preferred stock having such designation, relative powers, preferences (including preferences over our common stock respecting dividends and distributions), voting rights, terms of conversion or redemption, and other relative, participating, optional, or other special rights, if any, of the shares of each such series of preferred stock and any qualifications, limitations, or restrictions thereof, as our Board may determine.
While we have no specific plan to issue preferred stock in different series, our amended and restated articles of incorporation, as amended (“Articles of Incorporation”) authorizes us to issue, without the approval of our stockholders, one or more series of preferred stock having such designation, relative powers, preferences (including preferences over our common stock respecting dividends and distributions), voting rights, terms of conversion or redemption, and other relative, participating, optional, or other special rights, if any, of the shares of each such series of preferred stock and any qualifications, limitations, or restrictions thereof, as our Board may determine.
The contractual arrangements contain terms that specifically obligate the equity holders of our VIE to ensure the valid existence of our VIE and restrict the disposition of material assets or any equity interest of our VIE.
The contractual arrangements contain terms that specifically obligate the equity holders of our applicable VIE to ensure the valid existence of our VIE and restrict the disposition of material assets or any equity interest of our VIE.
Even if these matters do not result in litigation or are resolved in our favor or without significant cash settlements, these matters, and the time and resources necessary to litigate or resolve them, could harm our business, results or operations and reputation. 15 Third parties may assert that our employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets.
Even if these matters do not result in litigation or are resolved in our favor or without significant cash settlements, these matters, and the time and resources necessary to litigate or resolve them, could harm our business, results or operations and reputation. 14 Third parties may assert that our employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets.
The SEC may propose additional rules or guidance that could impact us if our auditor is not subject to PCAOB inspection. For example, on August 6, 2020, the President's Working Group on Financial Markets (the "PWG"), issued the Report on Protecting United States Investors from Significant Risks from Chinese Companies to the then President of the United States.
The SEC may propose additional rules or guidance that could impact us if our auditor is not subject to PCAOB inspection. For example, on August 6, 2020, the President’s Working Group on Financial Markets (the “PWG”), issued the Report on Protecting United States Investors from Significant Risks from Chinese Companies to the then President of the United States.
Section 404 of the Sarbanes-Oxley Act of 2002 ("Section 404") requires that we maintain internal control over financial reporting that meets applicable standards. We may err in the design or operation of our controls, and all internal control systems, no matter how well designed and operated, can provide only reasonable assurance that the objectives of the control system are met.
Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”) requires that we maintain internal control over financial reporting that meets applicable standards. We may err in the design or operation of our controls, and all internal control systems, no matter how well designed and operated, can provide only reasonable assurance that the objectives of the control system are met.
A substantial downturn in market demand for such seafood may have a material adverse effect on our business and on our results of operations. 12 A portion of our revenues are derived from a single product, eel and therefore we are highly susceptible to changes in market demand, which may be affected by factors over which we have limited or no control.
A substantial downturn in market demand for such seafood may have a material adverse effect on our business and on our results of operations. 11 A portion of our revenues are derived from a single product, eel and therefore we are highly susceptible to changes in market demand, which may be affected by factors over which we have limited or no control.
A company that qualifies only for initial listing under Nasdaq's alternative listing standard could become a "penny stock" if it later fails the net tangible assets and revenue tests after listing and does not satisfy any of the other exclusions from being a penny stock contained in Rule 3a51-1 under the Exchange Act.
A company that qualifies only for initial listing under Nasdaq’s alternative listing standard could become a “penny stock” if it later fails the net tangible assets and revenue tests after listing and does not satisfy any of the other exclusions from being a penny stock contained in Rule 3a51-1 under the Exchange Act.
As a result, the SEC has informed us that we are restricted from filing a registration statement on Form S-3, which is commonly used for investment activities, until the time the financial information for Meixin is no longer required to be included in a registration statement on Form S-3 (i.e., when the 2022 financials are no longer needed to be included in a registration statement).
As a result, the SEC informed us that we were restricted from filing a registration statement on Form S-3, which is commonly used for investment activities, until the time the financial information for Meixin is no longer required to be included in a registration statement on Form S-3 (i.e., when the 2022 financials are no longer needed to be included in a registration statement).
These factors could also make it more difficult for us to attract and retain qualified members of our Board. 16 Relations between the PRC and Taiwan could negatively affect our business and financial status and therefore the market value of your investment. Taiwan has a unique international political status. The PRC does not recognize the sovereignty of Taiwan.
These factors could also make it more difficult for us to attract and retain qualified members of our Board. 15 Relations between the PRC and Taiwan could negatively affect our business and financial status and therefore the market value of your investment. Taiwan has a unique international political status. The PRC does not recognize the sovereignty of Taiwan.
If this were to occur, it would be difficult for us to challenge this type of use, especially since we do not own any patents or other intellectual property rights with respect to our technologies and products. 13 We are subject to certain risks by virtue of our international operations.
If this were to occur, it would be difficult for us to challenge this type of use, especially since we do not own any patents or other intellectual property rights with respect to our technologies and products. 12 We are subject to certain risks by virtue of our international operations.
Andy Jin, our Chief Executive Officer, or any failure on our part to hire, train and retain a sufficient number of qualified professionals could impair our business. 11 We rely on the performance of highly skilled personnel, and if we are unable to attract, retain and motivate well-qualified employees, our business could be harmed.
Andy Jin, our Chief Executive Officer, or any failure on our part to hire, train and retain a sufficient number of qualified professionals could impair our business. 10 We rely on the performance of highly skilled personnel, and if we are unable to attract, retain and motivate well-qualified employees, our business could be harmed.
Decreased demand from a discrete event impacting a specific asset type, customer, industry, or region in which we have a concentrated exposure could negatively impact our results of operations. 19 In February 2022, Russia initiated significant military action against Ukraine.
Decreased demand from a discrete event impacting a specific asset type, customer, industry, or region in which we have a concentrated exposure could negatively impact our results of operations. 18 In February 2022, Russia initiated significant military action against Ukraine.
The occurrence of any of these circumstances may adversely affect our financial condition and results of operation. 14 The primary substantial portion of our revenues will be derived from Taiwan. We anticipate that sales of our services in Taiwan will represent our primary revenues in the near future.
The occurrence of any of these circumstances may adversely affect our financial condition and results of operation. 13 The primary substantial portion of our revenues will be derived from Taiwan. We anticipate that sales of our services in Taiwan will represent our primary revenues in the near future.
We will remain an "emerging growth company" until the last day of the fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement under the Securities Act, although we will lose that status sooner if our revenues exceed $1.235 billion, if we issue more than $1 billion in non-convertible debt in a three year period, or if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last day of our most recently completed second fiscal quarter.
We will remain an “emerging growth company” until the last day of the fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement under the Securities Act, although we will lose that status sooner if our revenues exceed $1.235 billion, if we issue more than $1 billion in non-convertible debt in a three year period, or if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last day of our most recently completed second fiscal quarter.
We may maintain our cash assets at certain financial institutions in the U.S. in amounts that may be in excess of the Federal Deposit Insurance Corporation ("FDIC") insurance limit of $250,000.
We may maintain our cash assets at certain financial institutions in the U.S. in amounts that may be in excess of the Federal Deposit Insurance Corporation (“FDIC”) insurance limit of $250,000.
Because there are inherent limitations in all control systems, there can be no assurance that all control issues have been or will be detected. As of December 31, 2023, we did not maintain effective controls over the control environment.
Because there are inherent limitations in all control systems, there can be no assurance that all control issues have been or will be detected. 20 As of December 31, 2024, we did not maintain effective controls over the control environment.
Subsequent to this acquisition, the SEC inquired about the financial information of Meixin as part of our regulatory filings. Despite our efforts to comply with these inquiries, we have been unable to provide complete financial information regarding Meixin due to the inability to locate Meixin's financial information.
The SEC inquired about the financial information of Meixin as part of our regulatory filings. Despite our efforts to comply with these inquiries, we have been unable to provide complete financial information regarding Meixin due to the inability to locate Meixin’s financial information.
There were five customers (Sano Morio, Handou Syuji, Ming-Chi Chen, Kai-Ling Chen and Sano Morimoto) who represented approximately 80.8% of our total revenue for the year ended December 31, 2023 of our total revenue for the prior year period. These customers are not located in mainland China or Hong Kong.
There were five customers (Sano Morio, Handou Syuji, Ming-Chi Chen, Kai-Ling Chen and Sano Morimoto) who represented approximately 81.8% of our total revenue for the year ended December 31, 2024 of our total revenue for the prior year period. These customers are not located in mainland China or Hong Kong.
We may lose the ability to use, or otherwise benefit from licenses and assets held by our VIE, which could render us unable to conduct some or all of our business operations and constrain our growth.
We may lose the ability to use, or otherwise benefit from licenses and assets held by one of our VIEs, which could render us unable to conduct some or all of our business operations and constrain our growth.
Our VIE, Meixin, holds assets, approvals and licenses that are necessary for the operation of a certain portion of our business to which foreign investments are typically restricted or prohibited under the laws of Taiwan.
One of our VIEs, Meixin, holds assets, approvals and licenses that are necessary for the operation of a certain portion of our business to which foreign investments are typically restricted or prohibited under the laws of Taiwan.
Our future plan of operations is to shift away from general construction services to the construction of fish farms and fish trading business. There can be no guarantee that such shift in operations will generate the same levels of revenues previously generated through our VIE. There is no assurance that we will be profitable.
Our future plan of operations is to shift away from general construction services to the construction of fish farms and fish trading business. There can be no guarantee that such shift in operations will generate the same levels of revenues previously generated through our variable interest entities. There is no assurance that we will be profitable.
In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We are choosing to take advantage of the extended transition period for complying with new or revised accounting standards.
In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We are choosing to take advantage of the extended transition period for complying with new or revised accounting standards.
The inability to use Form S-3 for securities offerings could adversely affect our ability to access capital in the markets and may hinder our growth strategies by limiting our funding options . In 2022, we acquired Meixin, a strategic addition to our portfolio aimed at enhancing market position and broadening our product offerings.
The inability to use Form S-3 for securities offerings could adversely affect our ability to access capital in the markets and may hinder our growth strategies by limiting our funding options . In 2024, we acquired SY Culture, a strategic addition to our portfolio aimed at enhancing market position and broadening our product offerings.
If we remain identified as a Commission-Identified Issuer and have a "non-inspection" year, there is no assurance that we will be able to take remedial measures in a timely manner.
If we remain identified as a Commission-Identified Issuer and have a “non-inspection” year, there is no assurance that we will be able to take remedial measures in a timely manner.
We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as (i) the market value of our common stock held by non-affiliates is equal to or less than $250 million as of the last business day of the most recently completed second fiscal quarter, and (ii) our annual revenues is equal to or less than $100 million during the most recently completed fiscal year and the market value of our common stock held by non-affiliates is equal to or less than $700 million as of the last business day of the most recently completed second fiscal quarter.
We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as (i) the market value of our common stock held by non-affiliates is equal to or less than $250 million as of the last business day of the most recently completed second fiscal quarter, and (ii) our annual revenues is equal to or less than $100 million during the most recently completed fiscal year and the market value of our common stock held by non-affiliates is equal to or less than $700 million as of the last business day of the most recently completed second fiscal quarter. 25 We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions.
We have a large number of authorized but unissued shares of our common stock which will dilute your ownership position when issued. Our authorized capital stock consists of 200,000,000 shares of common stock, of which approximately 187,043,013 shares are available for issuance.
We have a large number of authorized but unissued shares of our common stock which will dilute your ownership position when issued. Our authorized capital stock consists of 200,000,000 shares of common stock, of which approximately 178,232,053 shares are available for issuance.
These factors include: · quarterly variations in our results of operations or those of our competitors; · delays in end-user deployments of products; · fluctuations in related commodities prices; · announcements by us or our competitors of acquisitions, new products, significant contracts, commercial relationships or capital commitments; · intellectual property infringements; · our ability to develop and market new and enhanced products on a timely basis; · commencement of, or our involvement in, litigation; · major changes in our Board or management; · changes in governmental regulations; · changes in earnings estimates or recommendations by securities analysts; · the impact of any future COVID-19 outbreak or similar epidemic on capital markets; · our failure to generate material revenues; · our public disclosure of the terms of this financing and any financing which we consummate in the future; · any acquisitions we may consummate; · short selling activities; · changes in market valuations of similar companies; · changes in our capital structure, such as future issuances of securities or the incurrence of debt; · changes in the prices of commodities associated with our business; and · general economic conditions and slow or negative growth of end markets. 23 Additionally, the global economy and financial markets may be adversely affected by geopolitical events, including Russia's invasion of Ukraine and the conflicts in the Middle East.
These factors include: · quarterly variations in our results of operations or those of our competitors; · delays in end-user deployments of products; · fluctuations in related commodities prices; · announcements by us or our competitors of acquisitions, new products, significant contracts, commercial relationships or capital commitments; · intellectual property infringements; · our ability to develop and market new and enhanced products on a timely basis; · commencement of, or our involvement in, litigation; · major changes in our Board or management; · changes in governmental regulations; · changes in earnings estimates or recommendations by securities analysts; · our failure to generate material revenues; · our public disclosure of the terms of this financing and any financing which we consummate in the future; · any acquisitions we may consummate; · short selling activities; · changes in market valuations of similar companies; · changes in our capital structure, such as future issuances of securities or the incurrence of debt; · changes in the prices of commodities associated with our business; and · general economic conditions and slow or negative growth of end markets.
In the event that a claim for indemnification against such liabilities (other than payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. 26 If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.
In the event that a claim for indemnification against such liabilities (other than payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
Our ability to obtain additional capital on acceptable terms is subject to a variety of uncertainties, including: · investors' perception of, and demand for, our securities; · conditions of the U.S. and other capital markets in which we may seek to raise funds; and · our future results of operations, financial condition and cash flow.
If adequate funds are not obtained, we may be required to reduce, curtail or discontinue operations. 9 Our ability to obtain additional capital on acceptable terms is subject to a variety of uncertainties, including: · investors’ perception of, and demand for, our securities; · conditions of the U.S. and other capital markets in which we may seek to raise funds; and · our future results of operations, financial condition and cash flow.
Any debt financing secured in the future could involve restrictive covenants relating to capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital or to pursue business opportunities, including potential acquisitions. If adequate funds are not obtained, we may be required to reduce, curtail or discontinue operations.
Any debt financing secured in the future could involve restrictive covenants relating to capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital or to pursue business opportunities, including potential acquisitions.
Risks Related to Our Business There is substantial doubt of our ability to continue as a going concern. We have incurred net losses since our inception. In the twelve months ended December 31, 2023 and 2022, we incurred operating losses of $2,030,672 and $5,180,208, respectively.
Risks Related to Our Business There is substantial doubt of our ability to continue as a going concern. We have incurred net losses since our inception. In the twelve months ended December 31, 2024 and 2023, we incurred operating losses of $2,393,803 and $4,159,354, respectively.
As at December 31, 2023, we have working capital of $87,409 and had an accumulated deficit of $16,780,124. In their audit report for the fiscal year ended December 31, 2023 included in this report, our auditors have expressed their concern as to our ability to continue as a going concern.
As at December 31, 2024, we have working capital of $641,256 and had an accumulated deficit of $21,238,881. In their audit report for the fiscal year ended December 31, 2024 included in this report, our auditors have expressed their concern as to our ability to continue as a going concern.
If we fail to promote and maintain our brand or incur substantial expenses in an attempt to promote and maintain our brand or if our existing or future strategic relationships fail to promote our brand or increase brand awareness, our business, results of operations and financial condition would be materially adversely affected. 10 We may not generate the same level of revenues from general construction projects.
If we fail to promote and maintain our brand or incur substantial expenses in an attempt to promote and maintain our brand or if our existing or future strategic relationships fail to promote our brand or increase brand awareness, our business, results of operations and financial condition would be materially adversely affected.
In addition, the inability of the PCAOB to conduct inspections or full investigations of auditors would make it more difficult to evaluate the effectiveness of our independent registered public accounting firm's audit procedures or quality control procedures as compared to auditors that are subject to the PCAOB inspections, which could cause investors and potential investors to lose confidence in the audit procedures and reported financial information and the quality of our financial statements.
In addition, the inability of the PCAOB to conduct inspections or full investigations of auditors would make it more difficult to evaluate the effectiveness of our independent registered public accounting firm’s audit procedures or quality control procedures as compared to auditors that are subject to the PCAOB inspections, which could cause investors and potential investors to lose confidence in the audit procedures and reported financial information and the quality of our financial statements. 17 Our contractual arrangements may not be as effective in providing operational control as direct ownership and our VIE shareholders may fail to perform their obligations under our contractual arrangements.
Since our auditor is located in Hong Kong, it is included on a list of audit firms the PCAOB determined it is unable to inspect or investigate completely because of a position taken by one or more authorities in Hong Kong, and is therefore subject to the PCAOB's determination and currently not inspected by the PCAOB. 17 On March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCAA.
Since our auditor is located in Hong Kong, it is included on a list of audit firms the PCAOB determined it is unable to inspect or investigate completely because of a position taken by one or more authorities in Hong Kong, and is therefore subject to the PCAOB’s determination and currently not inspected by the PCAOB.
We are an "emerging growth company" and a "smaller reporting company" as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" and "smaller reporting companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. 25 In addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards.
We are an “emerging growth company” and a “smaller reporting company” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” and “smaller reporting companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
An inactive market may also impair our ability to raise capital by selling our securities and may impair our ability to acquire other businesses, applications, or technologies using our securities as consideration, which, in turn, could materially adversely affect our business and the market prices of your shares of common stock.
An inactive market may also impair our ability to raise capital by selling our securities and may impair our ability to acquire other businesses, applications, or technologies using our securities as consideration, which, in turn, could materially adversely affect our business and the market prices of your shares of common stock. 21 Shares of our common stock may continue to be subject to illiquidity because our shares may continue to be thinly traded and may never become eligible for trading on a national securities exchange.
We have a limited operating history in an evolving industry, which makes it difficult to evaluate our future prospects and may increase the risk that we will not be successful. We have a limited operating history on which to base an evaluation of its business and prospects.
There can be no assurance that the steps management is taking will be successful. We have a limited operating history in an evolving industry, which makes it difficult to evaluate our future prospects and may increase the risk that we will not be successful.
If our management determines to issue shares of our common stock from the large pool of authorized but unissued shares for any purpose in the future and is not required to obtain stockholder approval, your ownership position would be diluted without your further ability to vote on that transaction. 21 Sales of our currently issued and outstanding shares of common stock and shares of common stock underlying warrants may become freely tradable pursuant to Rule 144 and may dilute the market for your shares and have a depressive effect on the price of the shares of our common stock.
If our management determines to issue shares of our common stock from the large pool of authorized but unissued shares for any purpose in the future and is not required to obtain stockholder approval, your ownership position would be diluted without your further ability to vote on that transaction.
The market valuations of smaller reporting companies, such as us, frequently fluctuate due to factors unrelated to the past or present operating performance of such companies.
The market valuation of our business may fluctuate due to factors beyond our control and the value of your investment may fluctuate correspondingly. The market valuations of smaller reporting companies, such as us, frequently fluctuate due to factors unrelated to the past or present operating performance of such companies.
We are subject to all the risks inherent in a small company seeking to develop, market and distribute new services, particularly companies in evolving markets.
We have a limited operating history on which to base an evaluation of its business and prospects. We are subject to all the risks inherent in a small company seeking to develop, market and distribute new services, particularly companies in evolving markets.
There are continuing eligibility requirements for Nasdaq-listed companies. If we are unable to satisfy the continuing eligibility requirements of Nasdaq, our common stock could be delisted.
While our common stock is listed on The Nasdaq Capital Market, we cannot assure you that we will be able to maintain listing on Nasdaq. There are continuing eligibility requirements for Nasdaq-listed companies. If we are unable to satisfy the continuing eligibility requirements of Nasdaq, our common stock could be delisted.
Approximately 58% of the shares of common stock are "restricted securities" within the meaning of Rule 144 under the Securities Act ("Rule 144").
Approximately 7,520,408 of the shares of common stock are “restricted securities” within the meaning of Rule 144 under the Securities Act (“Rule 144”).
We are an "emerging growth company" and a "smaller reporting company" under the JOBS Act, and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies and smaller reporting companies will make our common stock less attractive to investors.
The Nasdaq Letter does not result in the immediate delisting of our common stock and our common stock will continue to trade uninterrupted on The Nasdaq Capital Market under the symbol “NCRA.” We are an “emerging growth company” and a “smaller reporting company” under the JOBS Act, and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies and smaller reporting companies will make our common stock less attractive to investors.
This restriction effectively limits our ability to engage in certain securities offerings under a Form S-3 registration statement until after the financials for the period ended September 30, 2024 go stale.
This restriction effectively limited our ability to engage in certain securities offerings under a Form S-3 registration statement during that period, specifically until after February 2025.
Also, such a delisting could significantly affect our ability to raise capital on acceptable terms, or at all, which would have a material adverse effect on our business, financial condition and prospects. 18 Inspections of other audit firms that the PCAOB has conducted outside the PRC have identified deficiencies in those firms' audit procedures and quality control procedures, which may be addressed as part of the inspection process to improve future audit quality.
Inspections of other audit firms that the PCAOB has conducted outside the PRC have identified deficiencies in those firms’ audit procedures and quality control procedures, which may be addressed as part of the inspection process to improve future audit quality.
In May 2021, the PCAOB issued a proposed rule 6100, Board Determinations Under the Holding Foreign Companies Accountable Act , for public comment.
The SEC is assessing how to implement other requirements of the HFCAA, including the listing and trading prohibition requirements described above. 16 In May 2021, the PCAOB issued a proposed rule 6100, Board Determinations Under the Holding Foreign Companies Accountable Act , for public comment.
The failure to receive research coverage or support in the market for our shares will have an adverse effect on our ability to develop a liquid market for our common stock. 24 Because we were a shell company before we conducted a reverse merger, holders of restricted shares will not be able to rely on exemption Rule 144 to resell their shares unless we comply with Rule 144(i).
The failure to receive research coverage or support in the market for our shares will have an adverse effect on our ability to develop a liquid market for our common stock. 24 We may not be able to satisfy the continued listing requirements of Nasdaq to maintain a listing of our common stock.
The terms of one or more classes or series of preferred stock could dilute the voting power or reduce the value of our common stock.
The terms of one or more classes or series of preferred stock could dilute the voting power or reduce the value of our common stock. For example, the repurchase or redemption rights or liquidation preferences we could assign to holders of a specific preferred stock class could affect the residual value of the common stock.
Further, any such interruption, security breach, loss or disclosure of confidential information could result in financial, legal, business and reputational harm to us and could have a material adverse effect on our business, financial position, results of operations and/or cash flow. 20 Risks Related to our Securities Our common stock has been listed on Nasdaq under the alternative initial listing standard which could suppress the trading price of our securities and the liquidity of your investment.
Further, any such interruption, security breach, loss or disclosure of confidential information could result in financial, legal, business and reputational harm to us and could have a material adverse effect on our business, financial position, results of operations and/or cash flow. 19 Evolving U.S. trade regulations and policies with China may in the future have a material and adverse effect on our business, financial condition and results of operations.
We would be required to comply with these rules if the SEC identifies it as having a "non-inspection" year under a process to be subsequently established by the SEC. The SEC is assessing how to implement other requirements of the HFCAA, including the listing and trading prohibition requirements described above.
On March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCAA. We would be required to comply with these rules if the SEC identifies it as having a “non-inspection” year under a process to be subsequently established by the SEC.
In addition, taking advantage of reduced disclosure obligations may make comparison of our financial statements with other public companies difficult or impossible.
If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile. In addition, taking advantage of reduced disclosure obligations may make comparison of our financial statements with other public companies difficult or impossible.
Our revenues for the year ended December 31, 2023 and for the year ended December 31, 2022 were approximately $23.9 million and $14.1 million, respectively.
We may not generate the same level of revenues from general construction projects. Our revenues for the year ended December 31, 2024 and for the year ended December 31, 2023 were approximately $17.01 million and $23.9 million, respectively.
The inability to use Form S-3 for securities offerings could adversely affect our ability to access capital in the markets and may hinder our growth strategies by limiting our funding options. These restrictions may place us at a competitive disadvantage relative to our peers who have greater access to capital in the markets.
These restrictions may place us at a competitive disadvantage relative to our peers who have greater access to capital in the markets and may potentially affect the confidence of investors and ultimately affect our stock price.
Securities class action litigation is often instituted against companies following periods of volatility in their stock price. This type of litigation could result in substantial costs to us and divert our management's attention and resources.
This type of litigation could result in substantial costs to us and divert our management’s attention and resources. Future sales or perceived sales of our common stock could depress the trading prices of our common stock.
Removed
There can be no assurance that the steps management is taking will be successful. Our business may be materially adversely affected by any future coronavirus (COVID-19) outbreak or similar global epidemic.
Added
Also, such a delisting could significantly affect our ability to raise capital on acceptable terms, or at all, which would have a material adverse effect on our business, financial condition and prospects.
Removed
A significant outbreak, epidemic or pandemic of contagious diseases in any geographic area in which we operate or plan to operate could result in a health crisis adversely affecting the economies, financial markets and overall demand for our services in such areas.
Added
The U.S. government has recently imposed multiple rounds of tariffs on imports from China, among others, and there is an increasing risk of further tariff increases.
Removed
In addition, any preventative or protective actions that governments implement or that we take in response to a health crisis, such as travel restrictions, quarantines or site closures, may interfere with the ability of our employees, suppliers and customers to perform their responsibilities. Such results could have a material adverse effect on our business.
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Any restrictions or tariffs imposed on products that we or our suppliers import for sale or production in the United States would adversely and directly impact our cost of goods sold and could force us to seek alternative suppliers, which may not be as cost effective or readily available.
Removed
COVID-19 created significant volatility, uncertainty and economic disruption. COVID-19 has affected nearly all regions around the world. In the United States, businesses as well as federal, state and local governments implemented significant actions to mitigate this public health crisis.
Added
In addition, changes in U.S. trade regulations and policies could have an adverse impact on trade relations between the United States and certain foreign countries, which could materially and adversely affect our relationships with our international suppliers and reduce the supply of goods available to us.
Removed
While we cannot predict the duration or scope of any future COVID-19 outbreak, it may negatively impact our business and such impact could be material to our financial results, condition and outlook related to: · disruption to our operations or the operations of our suppliers, through the effects of business and facilities closures, worker sickness and COVID-19 related inability to work, social, economic, political or labor instability in affected areas, transportation delays, difficulty in enrolling patients, travel restrictions and changes in operating procedures, including for additional cleaning and safety protocols; · increased volatility or significant disruption of global financial markets due in part to any future COVID-19 outbreak, which could have a negative impact on our ability to access capital markets and other funding sources, on acceptable terms or at all and impede our ability to comply with debt covenants; and · the further spread of COVID-19, and the requirements to take action to mitigate the spread of any future COVID-19 outbreak (e.g., hygiene requirements or social distancing or other measures), will impact our ability to carry out our business as usual and may materially adversely impact global economic conditions, our business, results of operations, cash flows and financial condition. 9 To the extent COVID-19 or a similar public health threat has an impact on our business, it is likely to also have the effect of heightening many of the other risks described in this " Risk Factors " section.
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Further, we cannot predict the extent to which the United States will adopt changes to existing trade regulations and policies, which creates uncertainties in planning our sourcing strategies and forecasting our margins.
Removed
Our contractual arrangements may not be as effective in providing operational control as direct ownership and our VIE shareholders may fail to perform their obligations under our contractual arrangements.
Added
If additional tariffs are imposed on our products, or other retaliatory trade measures are taken, our costs could increase, and we may be required to raise our prices, which could materially and adversely affect our results.
Removed
Shares of our common stock may continue to be subject to illiquidity because our shares may continue to be thinly traded and may never become eligible for trading on a national securities exchange. While our common stock is listed on The Nasdaq Capital Market, we cannot assure you that we will be able to maintain listing on Nasdaq.
Added
In addition, extended trade tensions and regulatory uncertainties may disrupt our supply chain, delay production or negatively impact our ability to compete in the market. Risks Related to our Securities Our common stock has been listed on Nasdaq under the alternative initial listing standard which could suppress the trading price of our securities and the liquidity of your investment.
Removed
For example, the repurchase or redemption rights or liquidation preferences we could assign to holders of a specific preferred stock class could affect the residual value of the common stock. 22 The market valuation of our business may fluctuate due to factors beyond our control and the value of your investment may fluctuate correspondingly.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeFor a discussion of potential cybersecurity risks affecting us, please refer to the following risk factor in the " Risk Factors " section in this Annual Report on Form 10-K titled " Risks Related to Our Business—We are increasingly dependent on information technology, and our systems and infrastructure face certain risks, including cybersecurity and data leakage risks. "
Biggest changeFor a discussion of potential cybersecurity risks affecting us, please refer to the following risk factor in the “ Risk Factors ” section in this Annual Report on Form 10-K titled “ Risks Related to Our Business—We are increasingly dependent on information technology, and our systems and infrastructure face certain risks, including cybersecurity and data leakage risks. ” 27
Such events could potentially lead to unauthorized access to, or disclosure of, sensitive information, disrupt our business operations, result in regulatory fines or litigation costs and negatively impact our reputation among customers and partners. 27 We are in the process of evaluating our cybersecurity needs and developing appropriate measures to enhance our cybersecurity posture.
Such events could potentially lead to unauthorized access to, or disclosure of, sensitive information, disrupt our business operations, result in regulatory fines or litigation costs and negatively impact our reputation among customers and partners. We are in the process of evaluating our cybersecurity needs and developing appropriate measures to enhance our cybersecurity posture.
ITEM 1C. CYBERSECURITY We acknowledge the increasing importance of cybersecurity in today's digital and interconnected world. Cybersecurity threats pose significant risks to the integrity of our systems and data, potentially impacting our business operations, financial condition and reputation.
ITEM 1C. CYBERSECURITY Risk Management and Strategy We acknowledge the increasing importance of cybersecurity in today’s digital and interconnected world. Cybersecurity threats pose significant risks to the integrity of our systems and data, potentially impacting our business operations, financial condition and reputation.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeCheng sub-leases this space to us, which is free of charge. As of March 31 2023, we own 229 contiguous acres of land located in Montgomery County, Alabama. We intend to build RASs on the land for fish farming.
Biggest changeCheng sub-leases this space to us, which is free of charge. Since March 31, 2023, we have owned 229 contiguous acres of land located in Montgomery County, Alabama. We intend to build RASs on the land for fish farming.
ITEM 2. PROPERTIES Our headquarter is located at 3F (Building B), No. 185, Sec. 1, Datong Rd., Xizhi Dist., New Taipei City 221, Taiwan (R.O.C.). The office is rented by Taiwan Grand Smooth Enterprise Co., Ltd., a company 100% controlled by Yin-Chieh Cheng, our former President, former Chief Executive Officer, and former Chairman of the Board. Mr.
ITEM 2. PROPERTIES Our headquarter is located at 3F (Building B), No. 185, Sec. 1, Datong Rd., Xizhi Dist., New Taipei City 221, Taiwan (R.O.C.). The office is rented by Taiwan Grand Smooth Enterprise Co., Ltd., a company 100% controlled by Yin-Chieh Cheng, our former President, former Chief Executive Officer, and former Chairman of the Board. The estate of Mr.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeCheng, our former Chief Executive Officer, former President, former Chairman of the Board, and former director, as a result of the exercise of Series A warrants. 29 The foregoing securities were issued in reliance on the exclusion from registration provided by either (i) Rule 701 of the Securities Act because the issuance was made pursuant to a compensatory benefit plan, (ii) Rule 903 of Regulation S under the Securities Act of the Securities Act because the recipient was a non-U.S.
Biggest changeThe foregoing securities were issued in reliance on the exclusion from registration provided by either (i) Rule 701 of the Securities Act because the issuance was made pursuant to a compensatory benefit plan, (ii) Rule 903 of Regulation S under the Securities Act of the Securities Act because the recipient was a non-U.S.
Person (as defined under Rule 902 Section (k)(2)(i) of Regulation S), or (iii) Section 4(a)(2) of the Securities Act due to the fact the issuance did not involve a public offering of securities to a U.S. Person.
Person (as defined under Rule 902 Section (k)(2)(i) of Regulation S), or (iii) Section 4(a)(2) of the Securities Act due to the fact the issuance did not involve a public offering of securities to a U.S.
EQUITY PLAN INFORMATION Plan Category: Number of securities to be issued upon exercise of outstanding options, warrants and rights: Weighted average exercise price of outstanding options, warrants and rights: Number of securities remaining available for future issuance: 2018 Equity Incentive Plan: Equity compensation plans approved by security holders – $ – 5,956,667 Equity compensation plans not approved by security holders – – – Total – $ – 5,956,667 Purchases of Equity Securities by the Issuer and Affiliated Purchasers None.
Person. 29 EQUITY PLAN INFORMATION Plan Category: Number of securities to be issued upon exercise of outstanding options, warrants and rights: Weighted average exercise price of outstanding options, warrants and rights: Number of securities remaining available for future issuance: 2018 Equity Incentive Plan: Equity compensation plans approved by security holders – $ – 5,956,667 Equity compensation plans not approved by security holders – – – Total – $ – 5,956,667 Purchases of Equity Securities by the Issuer and Affiliated Purchasers None.
The decision whether to pay cash dividends on our common stock will be made by our Board, at its discretion, and will depend on our financial condition, operating results, capital requirements and other factors that the Board considers significant. We did not pay cash dividends in the years ended December 31, 2023 or 2022.
The decision whether to pay cash dividends on our common stock will be made by our Board, at its discretion, and will depend on our financial condition, operating results, capital requirements and other factors that the Board considers significant. We did not pay cash dividends in the years ended December 31, 2024 or 2023.
Transfer Agent The transfer agent and registrar for our common stock is Mountain Share Transfer, LLC. Securities Authorized for Issuance under Equity Compensation Plans In 2018, the Board and stockholders adopted Nocera, Inc.'s 2018 Stock Option and Award Incentive Plan, effective December 31, 2018 (the "2018 Plan").
Transfer Agent The transfer agent and registrar for our common stock is Mountain Share Transfer, LLC. Securities Authorized for Issuance under Equity Compensation Plans In 2018, the Board and stockholders adopted Nocera, Inc.’s 2018 Stock Option and Award Incentive Plan, effective December 31, 2018 (the “2018 Plan”).
The Board reserved 6,666,667 (post-split) shares of common stock under the 2018 Plan. No awards have been granted to any employees or consultants pursuant to the 2018 Plan. As of December 31, 2023, a total of 5,956,667 shares of common stock are available for future issuance pursuant to the 2018 Plan.
The Board reserved 6,666,667 (post-split) shares of common stock under the 2018 Plan. No awards have been granted to any employees or consultants pursuant to the 2018 Plan. As of December 31, 2024, a total of 4,333,334 shares of common stock are available for future issuance pursuant to the 2018 Plan.
ITEM 5. MARKET FOR REGISTRANT'S COMMON STOCK, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock, par value $0.001, is listed on The Nasdaq Capital Market under the symbol "NCRA." Stockholders As of April 1, 2024, we had approximately 508 stockholders of record of our common stock, not including shares held in street name.
ITEM 5. MARKET FOR REGISTRANT’S COMMON STOCK, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock, par value $0.001, is listed on The Nasdaq Capital Market under the symbol “NCRA.” On May 5, 2025, the closing price for our common stock as reported on The Nasdaq Capital Market was $1.06 per share.
Removed
Unregistered Sales of Equity Securities Issuance of Common Stock · On March 22, 2023, we issued 450,000 shares of our common stock to our investor relation company, Hanover One International, Inc. · On July 31, 2023, we entered into an Employment Agreement with Andy Ching-An Jin, our Chief Executive Officer, in which, among other things, we issued a total of 240,000 shares of restricted stock, of which 60,000 shares vest at the end of every three months for a period of one year starting from July 31, 2023.
Added
Stockholders As of May 6, 2025, we had approximately 442 stockholders of record of our common stock, not including shares held in street name.
Removed
As of December 31, 2023, a total of 60,000 shares vested. · On October 11, 2023, we issued 20,000 shares of our common stock to our consultant, Yu-Hao Chang. · On December 27, 2023, we issued a total of 1,057,692 shares of common stock to the estate of Mr.
Added
Unregistered Sales of Equity Securities Issuance of Common Stock · On February 20, 2024, we entered into VIE Agreement with Xinca and issued 1,800,000 shares of our common stock in exchange of 100% controlling of Xinca; · On April 14, 2024, we entered into an Equity Purchase Agreement with SY Culture and issued 600,000 shares of our common stock in exchange of 100% equity of SY Culture; and · On November 11, 2024, our Chief Financial Officer, Shun-Chih Chuang, exercised 20,000 Class A warrants with an exercise price of $0.75 per share in exchange for 20,000 shares of common stock.

Item 7. Management's Discussion & Analysis

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

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Biggest changeConsolidated Statements of Operations For the years ended December 31, 2023 2022 Net Sales $ 23,915,926 $ 14,102,138 Cost of sales (23,720,967 ) (13,846,172 ) Gross profit 194,959 255,966 Operating expenses Impairment of goodwill (2,250,553 ) – General and administrative expenses (2,225,323 ) (2,772,102 ) Total operating expenses (4,475,876 ) (2,772,102 ) Other income (expense) (40,386 ) 417,999 Net loss from continuing operations before income taxes (4,321,303 ) (2,098,137 ) Income tax (expense) benefit (22,703 ) 23,808 Net loss from continuing operations (4,344,006 ) (2,074,329 ) Net loss from discontinued operations Loss on disposal – (2,569,975 ) (Loss) income from discontinued operations – (92,285 ) Net (loss) income from discontinued operations – (2,662,260 ) Net loss (4,344,006 ) (4,736,589 ) Less: Net income attributable to non-controlling interests 54,395 (76,319 ) Net loss attributable to Nocera Shareholders $ (4,289,611 ) $ (4,812,908 ) Other Comprehensive loss Net loss (4,344,006 ) (4,736,589 ) Foreign currency translation income (loss) 4,688 (89,688 ) Total comprehensive loss (4,339,318 ) (4,826,257 ) Less: Net income attributable to non-controlling interest 6,060 (76,319 ) Less: Foreign currency translation loss attributable to non-controlling interest – – Comprehensive loss attributable to Nocera Shareholders $ (4,333,258 ) $ (4,902,596 ) Loss per share - basic and diluted $ (0.4383 ) $ (0.6111 ) Net loss per share from continuing operations – basic and diluted (1) (0.4383 ) (0.2731 ) Net (loss) income per share from discontinued operations – basic and diluted (1) $ – $ (0.3380 ) Weighted Average Shares Outstanding - Basic and Diluted 9,814,000 7,876,367 (1) On August 11, 2022, the Company effected a 2:3 reverse stock split for each share of common stock issued and outstanding.
Biggest changeConsolidated Statements of Operations For the years ended December 31, 2024 2023 Net Sales $ 17,013,132 $ 23,915,926 Cost of sales (16,678,871 ) (23,720,967 ) Gross profit 334,261 194,959 Operating expenses Impairment of goodwill (1,159,172 ) (2,250,553 ) General and administrative expenses (2,135,336 ) (2,346,343 ) Total operating expenses (3,294,508 ) (4,596,876 ) Other income 690,514 265,266 Net loss from continuing operations before income taxes (2,269,733 ) (4,136,651 ) Income tax expense (124,070 ) (22,703 ) Net loss from continuing operations (2,393,803 ) (4,159,354 ) Net loss (2,393,803 ) (4,159,354 ) Less: Net income attributable to non-controlling interests 39,342 54,395 Net loss attributable to Nocera Shareholders $ (2,354,461 ) $ (4,104,959 ) Other Comprehensive loss Net loss (2,393,803 ) (4,159,354 ) Foreign currency translation income 86,491 4,688 Total comprehensive loss (2,307,312 ) (4,159,666 ) Less: Net income attributable to non-controlling interest 39,342 54,395 Less: Foreign currency translation loss attributable to non-controlling interest 4,549 (48,335 ) Comprehensive loss attributable to Nocera Shareholders $ (2,263,461 ) $ (4,148,606 ) Loss per share - basic and diluted $ (0.1807 ) $ (0.4238 ) Net loss per share from continuing operations – basic and diluted (1) $ (0.1807 ) $ (0.4238 ) Weighted Average Shares Outstanding - Basic and Diluted 13,249,705 9,814,000 (1) On August 11, 2022, the Company effected a 2:3 reverse stock split for each share of common stock issued and outstanding.
Where there is evidence that the utility of inventories, in their disposal in the ordinary course of business, will be less than cost, whether due to physical deterioration, obsolescence, changes in price levels or other causes, the inventories are written down to net realizable value. Property and Equipment, Net Property and equipment are stated at cost less accumulated depreciation.
Where there is evidence that the utility of inventories, in their disposal in the ordinary course of business, will be less than cost, whether due to physical deterioration, obsolescence, changes in price levels or other causes, the inventories are written down to net realizable value. Property and Equipment Property and equipment are stated at cost less accumulated depreciation.
The subscription was completed on August 10, 2021 · In August 2021, we issued 80,000 shares of preferred shares of $0.001 each at an issue price of $2.50 per share to certain investors credited as fully paid. · On September 27, 2021, we entered into securities purchase agreements with investors, pursuant to which we issued in a registered direct offering, an aggregate of 32,000 shares of our common stock at a per share purchase price of $3.75.
The subscription was completed on August 10, 2021 · In August 2021, we issued 80,000 shares of preferred shares of $0.001 each at an issue price of $2.50 per share to certain investors credited as fully paid. 44 · On September 27, 2021, we entered into securities purchase agreements with investors, pursuant to which we issued in a registered direct offering, an aggregate of 32,000 shares of our common stock at a per share purchase price of $3.75.
Set forth below is a brief discussion of the key factors impacting our results of operations. 31 Known Trends and Uncertainties Inflation Prices of certain commodity products, including raw materials, are historically volatile and are subject to fluctuations arising from changes in domestic and international supply and demand, labor costs, competition, market speculation, government regulations, trade restrictions and tariffs.
Set forth below is a brief discussion of the key factors impacting our results of operations. Known Trends and Uncertainties Inflation Prices of certain commodity products, including raw materials, are historically volatile and are subject to fluctuations arising from changes in domestic and international supply and demand, labor costs, competition, market speculation, government regulations, trade restrictions and tariffs.
In addition, as of December 2022, we sell food items, including our signature seafood porridge bowl, through our flagship bento box store located at the Ning Xia Night Market in the Datong District of Taipei City, Taiwan. 30 In October 2020, the government of Taiwan began supporting the Green Power and Solar Sharing Fish Farms initiative.
In addition, as of December 2022, we sell food items, including our signature seafood porridge bowl, through our flagship bento box store located at the Ning Xia Night Market in the Datong District of Taipei City, Taiwan. In October 2020, the government of Taiwan began supporting the Green Power and Solar Sharing Fish Farms initiative.
Revenue is measured at the transaction price which is based on the amount of consideration that we expect to receive in exchange for transferring the promised goods and providing maintenance service to the customer. Contracts with customers are comprised of invoices, and written contracts. 39 We do not have arrangements for returns from customers. We have no sales incentive programs.
Revenue is measured at the transaction price which is based on the amount of consideration that we expect to receive in exchange for transferring the promised goods and providing maintenance service to the customer. Contracts with customers are comprised of invoices, and written contracts. We do not have arrangements for returns from customers. We have no sales incentive programs.
We analyze the aging of the customer accounts, coverage of credit insurance, customer concentrations, customer credit-worthiness, historical and current economic trends and changes in its customer payment patterns when evaluating the adequacy of the allowance for doubtful accounts. 36 Prepaid Expenses and Other Assets, Net Prepaid expense and other assets, net consist of receivable from prepaid rent, etc.
We analyze the aging of the customer accounts, coverage of credit insurance, customer concentrations, customer credit-worthiness, historical and current economic trends and changes in its customer payment patterns when evaluating the adequacy of the allowance for doubtful accounts. Prepaid Expenses and Other Assets, Net Prepaid expense and other assets, net consist of receivable from prepaid rent, etc.
Bad debts are written off against the allowance after all collection efforts have ceased. Inventories Inventories are stated at lower of cost or net realizable value. Cost is determined using the weighted average method. Inventories include raw materials, work in progress and finished goods.
Bad debts are written off against the allowance after all collection efforts have ceased. 35 Inventories Inventories are stated at lower of cost or net realizable value. Cost is determined using the weighted average method. Inventories include raw materials, work in progress and finished goods.
Advance payments from customers are expected to be recognized as revenue within 12 months. Deferred revenue is expected to be recognized as revenue within 12 months. Cost of Sales Cost of sales consists primarily of purchase cost of merchandise goods, material costs, labor costs, depreciation, and related expenses, which are directly attributable to the production of the product.
Advance payments from customers are expected to be recognized as revenue within 12 months. Deferred revenue is expected to be recognized as revenue within 12 months. 38 Cost of Sales Cost of sales consists primarily of purchase cost of merchandise goods, material costs, labor costs, depreciation, and related expenses, which are directly attributable to the production of the product.
For additional information regarding these and other risks and uncertainties, please see the items listed above under the section captioned " Risk Factors ", as well as any other cautionary language contained in this Annual Report on Form 10-K.
For additional information regarding these and other risks and uncertainties, please see the items listed above under the section captioned “ Risk Factors ”, as well as any other cautionary language contained in this Annual Report on Form 10-K.
However, on derecognition of an investment in an equity instrument at FVTOCI, the cumulative gain or loss that had been recognized in other comprehensive income is transferred directly to retained earnings, without recycling through profit or loss. 35 Fair Value Measurement We apply ASC Topic 820, Fair Value Measurements and Disclosures which defines fair value, establishes a framework for measuring fair value and expands financial statement disclosure requirements for fair value measurements.
However, on derecognition of an investment in an equity instrument at FVTOCI, the cumulative gain or loss that had been recognized in other comprehensive income is transferred directly to retained earnings, without recycling through profit or loss. 34 Fair Value Measurement We apply ASC Topic 820, Fair Value Measurements and Disclosures which defines fair value, establishes a framework for measuring fair value and expands financial statement disclosure requirements for fair value measurements.
Significant items subject to such estimates and assumptions include, but are not limited to, the allowance for doubtful receivables; the useful lives of property and equipment and intangible assets; impairment of long-lived assets; recoverability of the carrying amount of inventory; fair value of financial instruments; provisional amounts based on reasonable estimates for certain income tax effects of the Tax Cuts and Jobs Act (the "Tax Act") and the assessment of deferred tax assets or liabilities.
Significant items subject to such estimates and assumptions include, but are not limited to, the allowance for doubtful receivables; the useful lives of property and equipment and intangible assets; impairment of long-lived assets; recoverability of the carrying amount of inventory; fair value of financial instruments; provisional amounts based on reasonable estimates for certain income tax effects of the Tax Cuts and Jobs Act (the “Tax Act”) and the assessment of deferred tax assets or liabilities.
Other changes in the carrying amount of these debt instruments are recognized in other comprehensive income and will be reclassified to profit or loss when these debt instruments are disposed. 34 3) Investments in equity instruments at FVTOCI On initial recognition, the Company may irrevocably designate investments in equity investments that is not held for trading as at FVTOCI.
Other changes in the carrying amount of these debt instruments are recognized in other comprehensive income and will be reclassified to profit or loss when these debt instruments are disposed. 33 3) Investments in equity instruments at FVTOCI On initial recognition, the Company may irrevocably designate investments in equity investments that is not held for trading as at FVTOCI.
We consider the policies discussed below to be critical to an understanding of our financial statements. 33 The SEC defines critical accounting policies as those that are, in management's view, most important to the portrayal of our financial condition and results of operations and those that require significant judgments and estimates.
We consider the policies discussed below to be critical to an understanding of our financial statements. 32 The SEC defines critical accounting policies as those that are, in management’s view, most important to the portrayal of our financial condition and results of operations and those that require significant judgments and estimates.
Recently Issued Accounting Pronouncements Please refer to the Note 3 to the Consolidated Financial Statements included herewith. 45
Recently Issued Accounting Pronouncements Please refer to the Note 3 to the Consolidated Financial Statements included herewith.
On August 11, 2022, the shares of our common stock began trading on The Nasdaq Stock Market LLC under the symbol "NCRA." The Shares and the Warrants comprising the units were immediately separable and issued separately in the Public Offering, which closed on August 15, 2022.
On August 11, 2022, the shares of our common stock began trading on The Nasdaq Stock Market LLC under the symbol “NCRA.” The Shares and the Warrants comprising the units were immediately separable and issued separately in the Public Offering, which closed on August 15, 2022.
Each unit consisted of one share of the Company's common stock and an "equity kicker" of one share of our common stock, for a total of 557,334 shares of common stock. · On August 10, 2022, our Registration Statement relating to the Public Offering was declared effective by the SEC.
Each unit consisted of one share of the Company’s common stock and an “equity kicker” of one share of our common stock, for a total of 557,334 shares of common stock. · On August 10, 2022, our Registration Statement relating to the Public Offering was declared effective by the SEC.
On September 23, 2022, the underwriters exercised their option to purchase an additional 282,000 warrants from us for gross proceeds of $2,820.
On September 23, 2022, the underwriters exercised their option to purchase an additional 282,000 warrants from us for gross proceeds of $2,820. The warrants were issued to the underwriters on September 26, 2022.
The annual average exchange rates for the year ended December 31, 2023 and 2022 are 7.1162 and 6.7208, respectively. (Loss) Earnings per Share Basic (loss) earnings per share is computed by dividing net (loss) income attributable to holders of common stock by the weighted average number of common shares outstanding during the year.
The annual average exchange rates for the year ended December 31, 2024, and 2023 are 7.2391 and 7.1162, respectively. (Loss) Earnings per Share Basic (loss) earnings per share is computed by dividing net (loss) income attributable to holders of common stock by the weighted average number of common shares outstanding during the year.
Translation adjustments are reported as foreign currency translation adjustments and are shown as a separate component of other comprehensive income or loss in the consolidated statements of changes in equity and comprehensive (loss) income. The exchange rates as of December 31, 2023 and 2022 are 7.1258 and 6.9646, respectively.
Translation adjustments are reported as foreign currency translation adjustments and are shown as a separate component of other comprehensive income or loss in the consolidated statements of changes in equity and comprehensive (loss) income. The exchange rates as of December 31, 2024, and 2023 are 7.3512and 7.1258, respectively.
Net loss attributable Net loss attributable to us (excluding net loss attributable to non-controlling interest) for the year ended December 31, 2023 was approximately $2 million compared to net loss attributable to us (excluding net income attributable to non-controlling interest) approximately of $4.8 million for the comparable period in 2022.
Net loss attributable Net loss attributable to us (excluding net loss attributable to non-controlling interest) for the year ended December 31, 2024 was approximately $2.3 million compared to net loss attributable to us (excluding net income attributable to non-controlling interest) approximately of $4.1 million for the comparable period in 2023.
Commitments and Contingencies In the normal course of business, we are subject to contingencies, including legal proceedings and claims arising out of its business that relate to a wide range of matters, such as government investigations and tax matters.
We account for forfeitures as they occur. 37 Commitments and Contingencies In the normal course of business, we are subject to contingencies, including legal proceedings and claims arising out of its business that relate to a wide range of matters, such as government investigations and tax matters.
In view of the opportunities resulting from this initiative, in October 2020, Nocera ceased all of its operations in China and moved all of its technology and back-office operations to Taiwan. We now only operate out of Taiwan.
In view of the opportunities resulting from this initiative, in October 2020, Nocera ceased all of its operations in China and moved all of its technology and back-office operations to Taiwan.
We have never paid and do not anticipate paying any cash dividends in the foreseeable future and, therefore, we use an expected dividend yield of zero in the pricing model. We account for forfeitures as they occur.
We have never paid and do not anticipate paying any cash dividends in the foreseeable future and, therefore, we use an expected dividend yield of zero in the pricing model.
Net cash (used in) provided by financing activities Net cash provided by financing activities amounted to $449,898 for the year ended December 31, 2023, which were primarily arising from proceeds from issuance of common stock during the year.
Net cash provided by financing activities amounted to $463,533 for the year ended December 31, 2023, which were primarily arising from proceeds from issuance of common stock during the year.
Our current mission is to provide consulting services and solutions in aquaculture projects to reduce water pollution and decrease the disease problems of fisheries. Our goal is to become a global leader in the land-based aquaculture business.
We now only operate out of Taiwan. 30 Our current mission is to provide consulting services and solutions in aquaculture projects to reduce water pollution and decrease the disease problems of fisheries. Our goal is to become a global leader in the land-based aquaculture business.
Cash and Cash Equivalents Cash and cash equivalents include all cash on hand and cash in bank with no restrictions. The balance of cash as of December 31, 2023 and 2022 were $1,229,580 and $2,906,074, respectively.
Cash and Cash Equivalents Cash and cash equivalents include all cash on hand and cash in bank with no restrictions. The balance of cash as of December 31, 2024, and 2023 were $484,161 and $1,229,580, respectively.
The decrease was primarily due to the decrease of General and administrative expenses for the year ended December 31, 2023. 43 Liquidity and Capital Resources; Going Concern We had net cash provided by operating activities for the year ended December 31, 2023 and the cash balance was approximately $1.2 million as of December 31, 2023.
The decrease was primarily due to the decrease of General and administrative expenses for the year ended December 31, 2024. 43 Liquidity and Capital Resources; Going Concern We had net cash used in operating activities for the year ended December 31, 2024 and the cash balance was approximately $0.48 million as of December 31, 2024.
Assets not subject to amortization are tested for impairment at least annually. The estimates of fair value are based on the best information available as of the date of the assessment, which primarily incorporates management assumptions about expected future cash flows.
Assets not subject to amortization are tested for impairment at least annually. The estimates of fair value are based on the best information available as of the date of the assessment, which primarily incorporates management assumptions about expected future cash flows. Although these assets are not currently impaired, there can be no assurance that future impairments will not occur.
The revenue for the year ended December 31, 2023 was mostly generated from Meixin catering business and the fish trading business from NTB with the revenue of $8.9 million and $14.9 million, respectively. The revenue for the year ended December 31, 2022 was mostly made from the catering business from Meixin and the fish trading business from NTB.
The revenue for the year ended December 31, 2024, was mostly decreased from Meixin catering business and the fish trading business from NTB with the revenue of $4.8 million and $11.8 million, respectively.
We are confident that profitability can be achieved by optimizing management expenses and enhancing profit margins. General and administrative expenses General and administrative expenses were $2.2 million, for the year ended December 31, 2023, compared to $2.7 million for the comparable period in 2022.
We are confident that profitability can be achieved by optimizing management expenses and enhancing profit margins. 42 General and administrative expenses General and administrative expenses were $900,395, for the three months ended December 31, 2024, compared to approximately $583,537 for the comparable period in 2023.
Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted into common shares.
Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted into common shares. Recently Issued Accounting Standards See Note 3 to the Consolidated Financial Statements included herewith.
All shares and associated amounts have been retroactively restated to reflect the stock split. 42 Comparison of Results of Operations for the years ended December 31, 2023 and December 31, 2022 Revenue Revenue of the Company for the year ended December 31, 2023 was approximately $23.9 million compared to approximately $14.1 million for the comparable period in 2022.
All shares and associated amounts have been retroactively restated to reflect the stock split. 41 Comparison of Results of Operations for the years ended December 31, 2024, and December 31, 2023 Revenue Revenue of the Company for the three months ended December 31, 2024 was approximately $3 ,997,039 million compared to approximately $ 7,467,601 million for the comparable period in 2023.
To the extent the U.S. dollar strengthens against foreign currencies, the translation of these foreign currencies denominated transactions results in reduced revenue, operating expenses and net income for our international operations.
To the extent the U.S. dollar strengthens against foreign currencies, the translation of these foreign currencies denominated transactions results in reduced revenue, operating expenses and net income for our international operations. We are also exposed to foreign exchange rate fluctuations as we convert the financial statements of our foreign subsidiaries into U.S. dollars in consolidation.
Although these assets are not currently impaired, there can be no assurance that future impairments will not occur. 38 Share-Based Compensation We determine our share-based compensation in accordance with ASC 718, Compensation—Stock Compensation (ASC 718), which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees based on the grant date fair value of the award.
Share-Based Compensation We determine our share-based compensation in accordance with ASC 718, Compensation—Stock Compensation (ASC 718), which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees based on the grant date fair value of the award.
The decrease in general and administrative expenses was mainly due to the decrease expenses of XFC in 2023. Other income (expense ) Other expense was $40,386 for the year ended December 31, 2023, compared to other income of $417,999 for the comparable period in 2022.
The decrease in general and administrative expenses was mainly due to the decrease of consulting fees, legal fees, miscellaneous expenses in 2024. Other income (expense) Other income was $690,514 for the year ended December 31, 2024, compared to other expense of $265,266 for the comparable period in 2023.
Net cash provided by financing activities amounted to $6,288,391 for the year ended December 31, 2022, which were primarily arising from proceeds from issuance of common stock and other borrowings during the year.
Net cash used in investing activities was $1,057,870 for the year ended December 31, 2023, which were primarily attributable to the purchase of property. 45 Net cash provided by financing activities Net cash provided by financing activities amounted to $597,053 for the year ended December 31, 2024, which were primarily arising from proceeds from issuance of common stock and other borrowings during the year.
As of December 31, 2023, we had an accumulated deficit of $16,780,128. In their audit report for the fiscal year ended December 31, 2023 included in this report, our auditors have expressed their concern as to our ability to continue as a going concern.
As of December 31, 2024, we had an accumulated deficit of $21,238,881, a net loss of $2,393,803, and net cash used in operating activities of $1,574,709. In their audit report for the fiscal year ended December 31, 2024 included in this report, our auditors have expressed their concern as to our ability to continue as a going concern.
As a result of the adoption, we recognized a lease liability and right-of-use asset for each of our existing lease arrangement.
As a result of the adoption, we recognized a lease liability and right-of-use asset for each of our existing lease arrangement. The adoption of the new lease standard does not have a material impact on our consolidated income statement or our consolidated statement of cash flow.
There are no uncertain tax positions as of December 31, 2023 and 2022, and we have no accrued interest or penalties related to uncertain tax positions. We do not believe that the unrecognized tax benefits will change over the next twelve months.
There are no uncertain tax positions as of December 31, 2024 and 2023, and we have no accrued interest or penalties related to uncertain tax positions.
Key Factors Affecting our Performance As a result of a number of factors, our historical results of operations may not be comparable to our results of operations in future periods, and our results of operations may not be directly comparable from period to period.
By integrating social commerce with our seafood resources, we enhance pricing advantages and optimize margins, strengthening our position in the evolving retail landscape. 31 Key Factors Affecting our Performance As a result of a number of factors, our historical results of operations may not be comparable to our results of operations in future periods, and our results of operations may not be directly comparable from period to period.
Deferred tax liability and assets are recognized for the deferred tax consequences of differences between the tax bases and the recognized values of assets acquired and liabilities assumed in a business combination in accordance with Accounting Standards Codification ("ASC") Topic 740-10.
Deferred tax liability and assets are recognized for the deferred tax consequences of differences between the tax bases and the recognized values of assets acquired and liabilities assumed in a business combination in accordance with Accounting Standards Codification (“ASC”) Topic 740-10. 36 Variable Interest Entity A variable interest entity is an entity (investee) is an entity in which the investor has obtained a controlling interest even if it has less than a majority of voting rights, according to the Financial Accounting Standards Board (FASB).
The functional currency of our VIE in Taiwan is Taiwan New Dollar ("TWD"), and the functional currency of our Hong Kong subsidiary is Hong Kong dollars ("HK$"). The functional currency of PRC companies is the Renminbi ("RMB"). In the consolidated financial statements, the financial information of our subsidiary and the consolidated VIE has been translated into US$.
In the consolidated financial statements, the financial information of our subsidiary and the consolidated VIE has been translated into US$.
We plan to enhance market penetration through the establishment of our own fish farms and diversify revenue streams through various sales channels.
We plan to enhance market penetration through the establishment of our own fish farms and diversify revenue streams through various sales channels. In 2024, we initiated the e-commerce business in China, utilizing platforms like Douyin to expand our retail reach, utilizing interactive content and livestream shopping to drive engagement and sales.
Comprehensive (Loss) Income Comprehensive income or loss is comprised of our net (loss) income and other comprehensive income or loss. The component of other comprehensive income or loss consists solely of foreign currency translation adjustments, net of the income tax effect. Foreign Currency Translation and Transactions Our reporting currency is the United States dollar ("US$").
We do not believe that the unrecognized tax benefits will change over the next twelve months. 39 Comprehensive (Loss) Income Comprehensive income or loss is comprised of our net (loss) income and other comprehensive income or loss. The component of other comprehensive income or loss consists solely of foreign currency translation adjustments, net of the income tax effect.
Useful life Leasehold improvements Shorter of the remaining lease terms and estimated useful lives Land Indefinite, as per land titles Furniture and fixture 5 years Equipment 3 years Machinery 5 years Vehicle 5 years Upon sale or disposal, the applicable amounts of asset cost and accumulated depreciation are removed from the accounts and the net amount less proceeds from disposal is charged or credited to income. 37 Business Combination For a business combination, the assets acquired, the liabilities assumed and any noncontrolling interest in the acquiree are recognized at the acquisition date and measured at their fair values as of that date.
Useful life Land Indefinite, as per land titles Equipment 3 years Upon sale or disposal, the applicable amounts of asset cost and accumulated depreciation are removed from the accounts and the net amount less proceeds from disposal is charged or credited to income.
The adoption of the new lease standard does not have a material impact on our consolidated income statement or our consolidated statement of cash flow. 40 Uncertain Tax Positions We account for uncertainty in income taxes using a two-step approach to recognizing and measuring uncertain tax positions.
Uncertain Tax Positions We account for uncertainty in income taxes using a two-step approach to recognizing and measuring uncertain tax positions.
Recently Issued Accounting Standards See Note 3 to the Consolidated Financial Statements included herewith. 41 Results of Operations The following table sets forth our consolidated statements of operations for the years ended December 31, 2023 and 2022.
These corrections are reflected in the accompanying consolidated financial statements and related disclosures, and supersede the previously filed interim financial results. See Note 3 to the consolidated financial statements for further detail. 40 Results of Operations The following table sets forth our consolidated statements of operations for the years ended December 31, 2024, and 2023.
To date, we have funded our operations through revenues, loans from our officers, and the issuance of equity securities. We obtained a financial support letter from shareholders. · On April 1, 2021, we entered in a securities purchase agreement with certain investors for an aggregate of 80,000 shares of its preferred stock at a per share purchase price of $2.50.
Management believes that the anticipated financing arrangements will provide sufficient liquidity to meet our obligations as they come due and to fund the Company’s ongoing and planned strategic initiatives over the next twelve months. · On April 1, 2021, we entered in a securities purchase agreement with certain investors for an aggregate of 80,000 shares of its preferred stock at a per share purchase price of $2.50.
Net cash (used in) provided by investing activities Net cash used in investing activities was $1,057,870 for the year ended December 31, 2023 which were primarily attributable to the purchase of equipment and intangible asset. Net cash used in investing activities was $4,030,834 for the year ended December 31, 2022 which were primarily cash paid for acquisition of a subsidiary.
Net cash (used in) provided by investing activities Net cash provided by investing activities was $211,801 for the year ended December 31, 2024, which were primarily attributable to the available-for-sale financial assets.
The gross profit for the year ended December 31, 2022 was mostly generated from Meixin catering business and the fish trading business from NTB with the revenue of approximately $110,000 and $82,000, respectively.
Gross profit for the year ended December 31, 2024 was approximately $334,261, compared to approximately $194,959 for the comparable period in 2023. The gross profit for the year ended December 31, 2024 was mostly generated from Meixin catering business and Xinca e-commerce business with the gross profit of approximately $63,554 and $183,358, respectively.
The warrants were issued to the underwriters on September 26, 2022. 44 The following table provides detailed information about our net cash flows for the periods indicated: For the years ended December 31, 2023 2022 Net cash provided by (used in) provided by operating activities $ (1,061,851 ) $ (1,771,551 ) Net cash (used in) provided by investing activities (1,057,870 ) (4,030,834 ) Net cash (used in) provided by financing activities 463,533 6,288,391 Effect of the exchange rate change on cash and cash equivalents (20,306 ) (23,941 ) (Decrease) Increase in cash and cash equivalents $ (1,676,494 ) $ 462,065 Net cash provided by (used in) operating activities Net cash used in operating activities amounted to $1,061,851 for the year ended December 31, 2023 This reflected a net loss of $4,321,303, as adjusted for non-cash items primarily including depreciation of $171,312, share-based compensation of $163,621, consultancy services settled by equities of $657,900.
The following table provides detailed information about our net cash flows for the periods indicated: For the years ended December 31, 2024 2023 Net cash used in operating activities $ (1,574,709 ) $ (1,084,595 ) Net cash provided by (used in) investing activities 211,801 (1,057,870 ) Net cash provided by financing activities 597,053 449,898 Effect of the exchange rate change on cash and cash equivalents 20,435 16,074 Decrease in cash and cash equivalents $ (745,420 ) $ (1,676,493 ) Net cash used in operating activities Net cash used in operating activities amounted to $ 1,574,709 for the year ended December 31, 2024.
For the year ended December 31, 2023 and 2022, our foreign currency translation gain was $27,079 and foreign currency translation loss was $89,688 of sales and income, respectively. Gross profit Gross profit for the year ended December 31, 2023 was approximately $194,959, compared to approximately $255,966 for the comparable period in 2022.
For the year ended December 31, 2024 and 2023, our foreign currency translation gain was $86,491 and foreign currency translation gain was $4,688 of sales and income, respectively. The decrease in revenue from $7.4 million in 2023 to $3.9 million in 2024 is primarily attributed to a downturn in the fish market in Taiwan.
The income for the year ended December 31, 2022 was mainly due to the waiver of payables. During the year ended December 31, 2022, we recorded an income tax benefit of $23,808 as compared to income tax expense of $0 for the comparable period in 2023.
The income for the year ended December 31, 2023 was mainly due to the waiver of payables. During the year ended December 31, 2024, the Company recorded a fair value adjustment related to its outstanding warrant liabilities, resulting in a non-cash gain of $797,269 for the year.
This reflected a net loss of $4,736,589, as adjusted for non-cash items primarily including loss on disposal of XFC of $2,569,975, depreciation of $66,907 and share-based compensation of $413,453, and offset by effect of changes in working capital including an decrease of $1,221,285 of inventories.
This reflected a net loss of $4,159,354, as adjusted for non-cash items primarily including depreciation of $171,312 and share-based compensation of $163,621, and Consultancy services settled by equities of $657,900.
The decrease of gross profit margin was mainly because in 2023, we had increased the fish trading business and decrease the revenue of the catering business of Meixin that leads to the decrease of revenue recognition. The operating loss incurred in NTB fish trading business is primarily attributed to administrative expenses, amounting to approximately $288,331.
The increase was primarily because there was an increase in demands of the sales through e-commerce business for the year ended December 31, 2024. The operating loss incurred in NTB fish trading business is primarily attributed to administrative expenses, amounting to approximately $2,042,581.
Removed
We are also exposed to foreign exchange rate fluctuations as we convert the financial statements of our foreign subsidiaries into U.S. dollars in consolidation. 32 Effects of COVID-19 COVID-19 has globally resulted in the loss of life, business closures, restrictions on travel and widespread cancellation of social gatherings.
Added
Business Combination For a business combination, the assets acquired, the liabilities assumed and any noncontrolling interest in the acquiree are recognized at the acquisition date and measured at their fair values as of that date.
Removed
The initial spread of COVID-19 in Asia caused some business disruption resulting in reduced net revenue in December 2019. Even though the COVID-19 pandemic has ended, there continues to be considerable uncertainty around any future COVID-19 outbreak and its resultant economic effects.
Added
Foreign Currency Translation and Transactions Our reporting currency is the United States dollar (“US$”). The functional currency of our VIE in Taiwan is Taiwan New Dollar (“TWD”), and the functional currency of our Hong Kong subsidiary is Hong Kong dollars (“HK$”). The functional currency of PRC companies is the Renminbi (“RMB”).
Removed
Therefore, we expect this matter to negatively impact our operating results for the foreseeable future if there is any future COVID-19 outbreak.
Added
Restatement of Previously Issued Interim Financial Statements In connection with the preparation of this Annual Report for the year ended December 31, 2024, we identified and corrected certain errors in our previously issued unaudited condensed consolidated financial statements for the quarters ended March 31, June 30, and September 30, 2024.
Removed
The extent to which any future COVID-19 outbreak impacts our business will depend on future developments, which are highly uncertain and cannot be predicted at this time, including: · new information which may emerge concerning the severity of the disease; · the duration and spread of the outbreak; · the severity of travel restrictions imposed by geographic areas in which we operate, mandatory or voluntary business closures; · regulatory actions taken in response to the pandemic, which may impact merchant operations, consumer and merchant pricing and our product offerings; · other business disruptions that affect our workforce; · the impact on capital and financial markets; and · actions taken throughout the world, including in markets in which we operate, to contain any future COVID-19 outbreak or treat its impact.
Added
Specifically, we inadvertently failed to perform the required fair value remeasurement of our warrant liabilities at the end of each of the first three quarters of 2024, as required by applicable accounting guidance. Additionally, certain assets and liabilities were misclassified between non-current assets and current liabilities during those periods, which required correction and reversal.
Removed
In addition, COVID-19 has adversely affected global economies and financial markets, and similar public health threats could do so in the future. Substantially all our revenues were concentrated in Taiwan pending expansion into other international markets.
Added
The impact of the fair value adjustment was material and resulted in a change from a net loss to net income in the affected quarters, along with a corresponding change from a loss per share to positive earnings per share. The impact of the misclassification of assets and liabilities reduced both total assets and total liabilities by $368,504.
Removed
Consequently, our results of operations will likely be adversely, and may be materially affected, to the extent that any future COVID-19 outbreak or any epidemic harms Taiwan's economy and society and the global economy in general.
Added
For the three months ended December 31, 2024, SY Culture and Xinca generated $27,631 and $40,936, respectively. Revenue of the Company for the year ended December 31, 2024 was approximately $17.01 million compared to approximately $23.9 million for the comparable period in 2023.
Removed
Any potential impact to our results will depend on, to a large extent, future developments and new information that may emerge regarding the duration and severity of any future COVID-19 outbreak and the actions taken by government authorities and other entities to contain any future COVID-19 outbreak or treat its impact, almost all of which are beyond our control.
Added
For the year ended December 31, 2024, SY Culture and Xinca generated $93,041 and $251,992, respectively. · Fish Trading Business: For the year ended December 31, 2024, the fish trading business decreased in volume, but the selling price increased, the volume decreased from 1083 tons to 770 tons for the comparable period in 2023 and 2024.
Removed
If the disruptions posed by any future COVID-19 outbreak or other matters of global concern continue for an extensive period of time, the operations of our business may be materially adversely affected.
Added
The average selling price of eels increased from $13.79 to $15.31 per kilogram for the comparable period in 2023 and 2024. · Catering Business: For the year ended December 31, 2024, the catering business separated into two lines of operations.
Removed
To the extent any future COVID-19 outbreak or a similar public health threat has an impact on our business, it is likely to also have the effect of heightening many of the other risks described in the “ Risk Factors ” section of Part I Item 1A.
Added
The bento box business volume decreased from 80,640 to 65,376 boxes with average price decreased from $3.85 to $3.74 per box for the comparable period in 2023 and 2024.
Removed
Variable Interest Entity A variable interest entity ("VIE") is an entity (investee) is an entity in which the investor has obtained a controlling interest even if it has less than a majority of voting rights, according to the Financial Accounting Standards Board (FASB).
Added
The fruit and vegetable processing service and sales volume decreased from 438,310 kilograms to 310,302 kilograms in volume with average prices decreased from $15.85 to $14.47 per kilograms for the comparable period in 2023 and 2024.
Removed
Net cash used in operating activities amounted to $1,771,551 for the year ended December 31, 2022.
Added
Specifically, the significantly low eel fry catch in 2022 and 2023 has led to a substantial reduction in the availability of market-size eels, impacting overall sales performance. Also, during the third quarter of 2024, Taiwan experienced a significant number of typhoons and other natural disasters.
Added
These adverse events negatively impacted the fish farming industry, leading to a decline in overall market production. We believe these environmental factors are critical to understanding the fluctuations in production during the period. To address this challenge and improve revenue, we are actively developing the cultivation of alternative aquaculture species to diversify our product offerings.
Added
Additionally, we are expanding and strengthening various sales channels to enhance market reach and drive revenue growth. Looking ahead, we anticipate that these adverse factors may continue to impact our operating results in the near term.

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