What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-02-14 compared with 2024-11-14 · 208 added, 206 removed, 416 unchanged (50% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

following discussion and analysis of our financial condition and results of operations for the three months ended September 30, 2024

and 2023 should be read in conjunction with the Financial Statements and corresponding notes included in this Report on Form 10-Q.

discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans,

objectives, expectations, and intentions.

Actual results and the timing of events could differ materially from those anticipated in these

forward-looking statements as a result of a number of factors, including those set forth under the Risk Factors and Special Note Regarding

Forward-Looking Statements in this report.

We use words such as “anticipate,” “estimate,” “plan,”

“project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,”

“may,” “will,” “should,” “could,” “target”, “forecast” and similar

expressions to identify forward-looking statements.

following discussion and analysis of our financial condition and results of operations for the three months ended December 31, 2024 and

2023 should be read in conjunction with the Financial Statements and corresponding notes included in this Report on Form 10-Q.

Our discussion

includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives,

expectations, and intentions.

Actual results and the timing of events could differ materially from those anticipated in these forward-looking

statements as a result of a number of factors, including those set forth under the Risk Factors and Special Note Regarding Forward-Looking

Statements in this report.

We use words such as “anticipate,” “estimate,” “plan,” “project,”

“continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,”

“will,” “should,” “could,” “target”, “forecast” and similar expressions to

identify forward-looking statements.

(Addentax Group Corp.) are a Nevada holding company with no material operations of our own.

30 unchanged sentences

Clothing Co., Ltd, a PRC company (“YS”), (vii) Shenzhen Yingxi Peng Fa Logistic Co., Ltd., a PRC company (“PF”);

(viii) Shenzhen Xin Kuai Jie Transportation Co., Ltd, a PRC company (“XKJ”), (ix) Zhuang Hao Jia (Dongguan) Decoration Engineering

Co.,Ltd, a PRC company (“ZHJ”), (x) Dongguan Au Te Si Garments Co., Ltd., a PRC company (“AOT”), (xi) Dongguan

Hongxiang Commercial Co., Ltd., a PRC company (“HX”).

(viii) Shenzhen Xin Kuai Jie Transportation Co., Ltd, a PRC company (“XKJ”), (ix) Dongguan Au Te Si Garments Co., Ltd., a

PRC company (“AOT”), (x) Dongguan Hongxiang Commercial Co., Ltd., a PRC company (“HX”).

Subsidiaries ” refer to, collectively, (i) Qianhai Yingxi Textile & Garments Co., Ltd.;

4 unchanged sentences

(vi) Shenzhen

Xin Kuai Jie Transportation Co., Ltd, a PRC company (“XKJ”), (vii) Zhuang Hao Jia (Dongguan) Decoration Engineering Co.,Ltd,

a PRC company (“ZHJ”), and (viii) Dongguan Aotesi Garments Co., Ltd.,, a PRC company (“AOT”), (ix) Dongguan Hongxiang

Commercial Co., Ltd., a PRC company (“HX”).

Xin Kuai Jie Transportation Co., Ltd, a PRC company (“XKJ”), (vii) Dongguan Aotesi Garments Co., Ltd.,, a PRC company (“AOT”),

and (viii) Dongguan Hongxiang Commercial Co., Ltd., a PRC company (“HX”).

refers to Qianhai Yingxi Textile & Garments Co., Ltd, a wholly foreign owned enterprise in China, which is indirectly wholly owned

6 unchanged sentences

subsidiaries, namely Dongguan Heng Sheng Wei Garments Co., Ltd (“HSW”), Dongguan Yushang Clothing Co., Ltd (“YS”)

Zhuang Hao Jia (Dongguan) Decoration Engineering Co.,Ltd (“ZHJ”), and Dongguan Aotesi

Garments Co., Ltd., (“AOT”) , which are located in the Guangdong province, China.

and Dongguan Aotesi Garments Co., Ltd., (“AOT”) , which are located in the Guangdong

province, China.

logistics business consists of delivery and courier services covering 44 cities in 10 provinces and 2 municipalities in China.

11 unchanged sentences

April 2024 and received approval from RPC authorities.

at the date of this report, the Company is in the process of dissolving another subsidiary, ZHJ.

Company dissolved another subsidiary, Zhuang Hao Jia (Dongguan) Decoration Engineering Co.,Ltd

(“ZHJ”), in August 2024 and received approval from RPC authorities.

Manufacturing Business

5 unchanged sentences

delivery and courier network in China.

As of September 30, 2024, we provide logistics services to over 44 cities in approximately 10

provinces and 2 municipalities.

As of December 31, 2024, we provide logistics services to over 44 cities in approximately 10 provinces

and 2 municipalities.

We expect to develop 20 additional logistics routes in existing serving cities and improve the Company’s

4 unchanged sentences

The Company conduct the business

through a wholly owned subsidiary acquired in September 2023, namely Dongguan Hongxiang Commercial Co., Ltd., a PRC company (“HX”).

through a wholly owned subsidiary acquired in December 2023, namely Dongguan Hongxiang Commercial Co., Ltd., a PRC company (“HX”).

Manufacturing Business

133 unchanged sentences

a significant impact on the Company’s consolidated financial statements.

of Operations for the three months ended September 30, 2024 and 2023

following table summarize our results of operations for the three months ended September 30, 2024 and 2023.

of Operations for the three months ended December 31, 2024 and 2023

following table summarize our results of operations for the three months ended December 31, 2024 and 2023.

The table and the discussion

below should be read in conjunction with our consolidated financial statements and the notes thereto appearing elsewhere in this report.

Three Months Ended September 30,

Changes in 2024

compared to 2023

Months Ended December 31,

dollars, except for percentages)

7 unchanged sentences

$ (1,085,721 )

revenue for the three months ended September 30, 2024 was nearly the same as compared with the three months ended September 30, 2023.

$ (2,607,662 )

revenue for the three months ended December 31, 2024 decreased by approximately $0.4 million, or 27.9%, as compared with the three months

ended December 31, 2023.

The decrease was mainly due to the decrease of $0.4 million in logistics services business.

generated from our garment manufacturing business contributed approximately $0.03 million, or 3.2%, of our total revenue for the three

months ended September 30, 2024.

months ended December 31, 2024.

Revenue generated from garment manufacturing business contributed approximately $0.03 million or 1.8%

of our total revenue for the three months ended September 30, 2023, respectively.

of our total revenue for the three months ended December 31, 2023, respectively.

The low level of sales was mainly due to factory facilities

3 unchanged sentences

generated from our logistics services business contributed approximately $0.8 million, or 78.5%, of our total revenue for the three months

ended September 30, 2024.

ended December 31, 2024.

Revenue generated from our logistic business contributed approximately $1.2 million or 81.0% of our total revenue

for the three months ended September 30, 2023.

for the three months ended December 31, 2023.

generated from our property management and subleasing business was 0.2 million, or 18.4%, of our total revenue for the three months ended

September 30, 2024.

The revenue from this business segment was $0.06 million or 4.3% of our total revenue for the three months ended

September 30, 2023.

Three months ended September 30,

Increase (decrease) in

December 31, 2024.

The revenue from this business segment was $0.3 million or 17.2% of our total revenue for the three months ended December

months ended December 31,

(decrease) in

compared to 2023

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Gross Profit for property management and subleasing

Net revenue for corporate and others

Merchandise/Finished goods/Raw materials

Total cost of revenue for corporate and others

Gross (loss) income for corporate and others

Total cost of revenue

1 unchanged sentence

material costs for our garment manufacturing business were approximately 35.3% of our total garment manufacturing business revenue for

the three months ended September 30, 2024, as compared with 28.9% for the three months ended September 30, 2023.

the three months ended December 31, 2024, as compared with 15.7% for the three months ended December 31, 2023.

The increase in percentage

1 unchanged sentence

costs for our garment manufacturing business was approximately 38.1% of our total garment manufacturing business revenue for the three

months ended September 30, 2024, as compared with 50.9% for the three months ended September 30, 2023.

months ended December 31, 2024, as compared with 25.8% for the three months ended December 30, 2023.

We maintained a sustainable level

1 unchanged sentence

and other expenses for our garment manufacturing business accounted for approximately 10.0% of our total garment business revenue for

the three months ended September 30, 2024, as compared with 2.9% of total garment business revenue for the three months ended September

the three months ended December 31, 2024, as compared with (4.8)% of total garment business revenue for the three months ended December

our logistic business, we outsourced some of the business to our contractors.

We relied on a few subcontractors, of which the

subcontracting fees to our largest contractor represented approximately nil% and 35.1% of total cost of revenues for our service

segment for the three months ended September 30, 2024 and 2023, respectively.

The decrease was attributed to an increase in usage of

our own logistics as compared to the subcontractor.

We have not experienced any disputes with our subcontractors and we believe we

maintain good relationships with our contract logistics services providers.

toll and other costs for our service business for the three months ended September 30, 2024 were approximately $0.5 million as compared

with $0.5 million for the three months ended September 30, 2023.

We relied on a few subcontractors, of which the subcontracting

fees to our largest contractor represented approximately % and 53.1% of total cost of revenues for our service segment for the three

months ended December 31, 2024 and 2023, respectively.

The decrease was attributed to an increase in usage of our own logistics as compared

to the subcontractor.

We have not experienced any disputes with our subcontractors and we believe we maintain good relationships with

our contract logistics services providers.

toll and other costs for our service business for the three months ended December 31, 2024 were approximately $0.5 million as compared

with $0.5 million for the three months ended December 31, 2023.

Fuel, toll and other costs for our service business accounted for approximately

53.0% of our total service revenue for the three months ended September 30, 2024, as compared with 43.3% for the three months ended September

63.6% of our total service revenue for the three months ended December 31, 2024, as compared with 41.6% for the three months ended December

The increase was primarily attributable to a decrease of usage of subcontractors during the quarter.

Subcontracting

fees for our service business for the three months ended September 30, 2024 decreased approximately 100.0% to $nil from $0.3 million

for the three months ended September 30, 2023.

Subcontracting fees accounted for nil% and 28.6% of our total service business revenue

in the three months ended September 30, 2024 and 2023, respectively.

The decrease was primarily attributable to a decrease of usage of

subcontractors during the quarter.

fees for our service business for the three months ended December 31, 2024 decreased approximately 79.0% to $0.1 from $0.6 million for

the three months ended December 31, 2023.

Subcontracting fees accounted for 14.2% and 47.2% of our total service business revenue in

the three months ended December 31, 2024 and 2023, respectively.

The decrease was primarily attributable to a decrease of usage of subcontractors

during the quarter.

property management and subleasing business, the cost of revenue was mainly the amortization of operating lease assets for the subleasing

The cost of revenue for property management and subleasing business for the three months ended September 30, 2024 was $371,019,

The cost of revenue for property management and subleasing business for the three months ended December 31, 2024 was $301,834,

approximately 155.2% of our total property management and subleasing business revenue, as compared with $236,291, or 93.6% of the total

property management and subleasing business revenue for the three months ended September 30, 2023.

manufacturing business gross profit for the three months ended September 30, 2024 was $17,679, as compared with $15,767 for the three

months ended September 30, 2023.

Gross profit accounted for 11.9% of our total garment manufacturing business revenue for the three months

ended September 30, 2024, as compared to 17.3% for the three months ended September 30, 2023.

The decrease of gross profit ratio was

mainly due to the increased raw material costs.

profit in our logistics services business for the three months ended September 30, 2024 was approximately $453,406 and gross margin was

Gross profit in our logistics services business for the three months ended September 30, 2023 was approximately $333,667 and gross

property management and subleasing business revenue for the three months ended December 31, 2023.

manufacturing business gross profit for the three months ended December 31, 2024 was $5,620, as compared with $17,113 for the three months

ended December 31, 2023.

Gross profit accounted for 16.6% of our total garment manufacturing business revenue for the three months ended

December 31, 2024, as compared to 63.3% for the three months ended December 31, 2023.

The decrease of gross profit ratio was mainly due

to the increased raw material costs.

profit in our logistics services business for the three months ended December 31, 2024 was approximately $184,545 and gross margin was

Gross profit in our logistics services business for the three months ended December 31, 2023 was approximately $132,917 and gross

margin was 11.2%.

The increase of gross profit ratio was mainly because the Company re-allocated the orders received and reduced fuel

loss in our property management and subleasing business for the three months ended September 30, 2024 was $142,440.

loss in our property management and subleasing business for the three months ended December 31, 2024 was $107,346.

Gross profit was $16,186

$53,453 for the three months ended September 30, 2023.

Gross loss accounted for (62.3)% of our total property management and subleasing

business revenue for the three months ended September 30, 2024, as compared to 92.1% for the three months ended September 30, 2023.

decrease of gross profit ratio was mainly because the property management and subleasing business are still in preliminary stage.

Three months ended September 30,

for the three months ended December 31, 2023.

Gross loss accounted for (55.2)% of our total property management and subleasing business

revenue for the three months ended December 31, 2024, as compared to 6.4% for the three months ended December 31, 2023.

of gross profit ratio was mainly because the property management and subleasing business are still in preliminary stage.

Three months ended December 31,

Increase (decrease) in

6 unchanged sentences

General and administrative expenses

selling expenses for our garment manufacturing business for the three months ended September 30, 2024 and 2023 was approximately $13,400

and nil, respectively.

The selling expenses for property management and subleasing business for the three months ended September 30,

selling expenses for our garment manufacturing business for the three months ended December 31, 2024 and 2023 was approximately $28,818

and $13,504, respectively.

The selling expenses for property management and subleasing business for the three months ended December 31,

2024 and 2023 was approximately $83,127 and $81,817, respectively.

1 unchanged sentence

unloading charges and product inspection charges.

general and administrative expenses in our garment manufacturing business segment for the three months ended September 30, 2024 and 2023

general and administrative expenses in our garment manufacturing business segment for the three months ended December 31, 2024 and 2023

was approximately $8,021 and $34,007, respectively.

Our general and administrative expenses in our logistics services segment for the

three months ended September 30, 2024 and 2023 was approximately $223,375 and $160,700, respectively.

The general and administrative

expenses in our property management and subleasing business was approximately $50,473 and nil for the three months ended September 30,

three months ended December 31, 2024 and 2023 was approximately $175,837 and $174,618, respectively.

The general and administrative expenses

in our property management and subleasing business was approximately $43,790 and $132,336for the three months ended December 31, 2024

and 2023, respectively.

Our general and administrative expenses in our corporate office for the three months ended September 30,

Our general and administrative expenses in our corporate office for the three months ended December 31, 2024

and 2023 was approximately $124,279 and $175,636, respectively.

2 unchanged sentences

costs and other expenses that are not directly attributable to our revenues.

general and administrative expenses for the three months ended September 30, 2024 decreased by approximately 4.2% to $1.1 million from

$1.2 million for the three months ended September 30, 2023.

general and administrative expenses for the three months ended December 31, 2024 decreased by approximately 31.9% to $0.4 million from

$0.5 million for the three months ended December 31, 2023.

from operations

from operations for the three months ended September 30, 2024 and 2023 was approximately $245,066 and $304,932, respectively.

from operations of approximately $1,622 and loss from operation of $19,000 for the three months ended September 30, 2024 and 2023, respectively,

from operations for the three months ended December 31, 2024 and 2023 was approximately $381,054 and $449,592, respectively.

operations of approximately $31,220 and loss from operation of $30,398 for the three months ended December 31, 2024 and 2023, respectively,

which was attributed from our garment manufacturing segment.

Income from operations of approximately $229,558 and $172,300 was attributed

from our logistics services segment for the three months ended September 30, 2024 and 2023, respectively.

Loss from operations of approximately

$201,865 and $13,400for the three months ended September 30, 2024 and 2023, respectively, which was attributed from our property management

and subleasing business.

We incurred expenses from operations in corporate office of approximately $274,381 and $444,900 for the three

months ended September 30, 2024 and 2023, respectively.

tax expense for the three months ended September 30, 2024 and 2023 was approximately $1,062 and $3,237, respectively.

Income from operations of approximately $8,707 and loss from operation of

$41,699 was attributed from our logistics services segment for the three months ended December 31, 2024 and 2023, respectively.

from operations of approximately $234,264 and $168,012 for the three months ended December 31, 2024 and 2023, respectively, which was

attributed from our property management and subleasing business.

We incurred expenses from operations in corporate office of approximately

$124,277 and $209,483 for the three months ended December 31, 2024 and 2023, respectively.

tax expense for the three months ended December 31, 2024 and 2023 was approximately $3,116 and $3,225, respectively.

Yingxi primarily

4 unchanged sentences

No provision for income taxes

in Hong Kong has been made as Yingxi HK had no taxable income for the three months ended September 30, 2024 and 2023.

in Hong Kong has been made as Yingxi HK had no taxable income for the three months ended December 31, 2024 and 2023.

and YX were incorporated in the PRC and is subject to the PRC Enterprise Income Tax (EIT) rate is 25%.

No provision for income taxes

in the PRC has been made as QYTG and YX had no taxable income for the three months ended September 30, 2024 and 2023.

in the PRC has been made as QYTG and YX had no taxable income for the three months ended December 31, 2024 and 2023.

majority of our subsidiaries are governed by the Income Tax Laws of the PRC.

5 unchanged sentences

has been made as Addentax Group Corp.

had no United States taxable income for the three months ended September 30, 2024 and 2023.

incurred net loss of approximately $0.7 million and net income of $1.4 million for the three months ended September 30, 2024 and 2023,

respectively.

Our basic and diluted earnings per share were ($0.13) and $0.837 for the three months ended September 30, 2024 and 2023,

respectively.

of Operations for the six months ended September 30, 2024 and 2023

following table summarize our results of operations for the six months ended September 30, 2024 and 2023.

had no United States taxable income for the three months ended December 31, 2024 and 2023.

incurred net loss of approximately $1.1 million and $2.6 million for the three months ended December 31, 2024 and 2023, respectively.

Our basic and diluted earnings per share were ($0.19) and ($0.66) for the three months ended December 31, 2024 and 2023, respectively.

of Operations for the nine months ended December 31, 2024 and 2023

following table summarize our results of operations for the nine months ended December 31, 2024 and 2023.

The table and the discussion

below should be read in conjunction with our consolidated financial statements and the notes thereto appearing elsewhere in this report.

Six Months Ended September 30,

Changes in 2024

compared to 2023

Months Ended December 31,

dollars, except for percentages)

8 unchanged sentences

$ (3,973,983 )

revenue for the six months ended September 30, 2024 decreased by approximately $0.2 million, or 8.2%, as compared with the six months

ended September 30, 2023.

The decrease was mainly due to the decrease of $0.7 million in logistics services, increase of $0.1 million

revenue for the nine months ended December 31, 2024 decreased by approximately $0.6 million, or 15.7%, as compared with the nine months

ended December 31, 2023.

The decrease was mainly due to the decrease of $1.1 million in logistics services, decrease of $0.1 million

in garment manufacturing business and increase of $0.4 million in property management and subleasing business.

generated from our garment manufacturing business contributed approximately $0.2 million, or 10.7%, of our total revenue for the six

months ended September 30, 2024.

generated from our garment manufacturing business contributed approximately $0.3 million, or 8.3%, of our total revenue for the nine

months ended December 31, 2024.

Revenue generated from garment manufacturing business contributed approximately $0.2 million or 4.5%

of our total revenue for the six months ended September 30, 2023, respectively.

of our total revenue for the nine months ended December 31, 2023, respectively.

The low level of sales was mainly due to factory facilities

2 unchanged sentences

at the fiscal year ending 2025.

generated from our logistics services business contributed approximately $1.5 million, or 66.2%, of our total revenue for the six months

ended September 30, 2024.

generated from our logistics services business contributed approximately $2.3 million, or 70.2%, of our total revenue for the nine months

ended December 31, 2024.

Revenue generated from our logistic business contributed approximately $3.4 million or 87.5% of our total revenue

for the six months ended September 30, 2023.

generated from our property management and subleasing business was 0.5 million, or 23.1%, of our total revenue for the six months ended

September 30, 2024.

The revenue from this business segment was $0.06 million for the six months ended September 30, 2023.

Six months ended September 30,

Increase (decrease) in

for the nine months ended December 31, 2023.

generated from our property management and subleasing business was 0.7 million, or 21.6%, of our total revenue for the nine months ended

December 31, 2024.

The revenue from this business segment was $0.3 million or 8.1% of our total revenue for the nine months ended December

months ended December 31,

(decrease) in

compared to 2023

13 unchanged sentences

Gross Profit for property management and subleasing

Net revenue for supplies corporate and others

Other and Overhead

Total cost of revenue for corporate and others

Gross (loss) income for corporate and others

Total cost of revenue

1 unchanged sentence

material costs for our garment manufacturing business were approximately 50.9% of our total garment manufacturing business revenue for

the six months ended September 30, 2024, as compared with 17.9% for the six months ended September 30, 2023.

the nine months ended December 31, 2024, as compared with 17.5% for the nine months ended December 31, 2023.

The increase in percentage

was mainly due to the increased order received.

costs for our garment manufacturing business was approximately 23.2% of our total garment manufacturing business revenue for the six

months ended September 30, 2024, as compared with 64.2% for the six months ended September 30, 2023.

costs for our garment manufacturing business was approximately 25.1% of our total garment manufacturing business revenue for the nine

months ended December 31, 2024, as compared with 58.2% for the nine months ended December 31, 2023.

We maintained a sustainable level

1 unchanged sentence

and other expenses for our garment manufacturing business accounted for approximately 5.2% of our total garment business revenue for

the six months ended September 30, 2024, as compared with 1.8% of total garment business revenue for the six months ended September 30,

the nine months ended December 31, 2024, as compared with 0.8% of total garment business revenue for the nine months ended December 31,

our logistic business, we outsourced some of the business to our contractors.

We relied on a few subcontractors, which the

subcontracting fees to our largest contractor represented approximately nil% and 36.1% of total cost of revenues for our service

segment for the six months ended September 30, 2024 and 2023, respectively.

The decrease was attributed to an increase in usage of

our own logistics as compared to the subcontractor.

We have not experienced any disputes with our subcontractors and we believe we

maintain good relationships with our contract logistics services providers.

toll and other costs for our service business for the six months ended September 30, 2024 were approximately $0.8 million as compared

with $1.0 million for the six months ended September 30, 2023.

We relied on a few subcontractors, which the subcontracting

fees to our largest contractor represented approximately nil% and 36.1% of total cost of revenues for our service segment for the nine

months ended December 31, 2024 and 2023, respectively.

The decrease was attributed to an increase in usage of our own logistics as compared

to the subcontractor.

We have not experienced any disputes with our subcontractors and we believe we maintain good relationships with

our contract logistics services providers.

toll and other costs for our service business for the nine months ended December 31, 2024 were approximately $1.3 million as compared

with $1.5 million for the nine months ended December 31, 2023.

Fuel, toll and other costs for our service business accounted for approximately

52.4% of our total service revenue for the six months ended September 30, 2024, as compared with 45.8% for the six months ended September

56.5% of our total service revenue for the nine months ended December 31, 2024, as compared with 44.4% for the nine months ended December

The increase was primarily attributable to a decrease of usage of subcontractors during the quarter.

Subcontracting

fees for our service business for the six months ended September 30, 2024 decreased approximately 100.0% to $nil from $0.6 million for

the six months ended September 30, 2023.

Subcontracting fees accounted for nil% and 28.4% of our total service business revenue in the

six months ended September 30, 2024 and 2023, respectively.

fees for our service business for the nine months ended December 31, 2024 decreased approximately 90.0% to $0.1 million from $1.2 million

for the nine months ended December 31, 2023.

Subcontracting fees accounted for 5.2% and 35.0% of our total service business revenue in

the nine months ended December 31, 2024 and 2023, respectively.

The decrease was primarily attributable to a decrease of usage of subcontractors

1 unchanged sentence

property management and subleasing business, the cost of revenue was mainly the amortization of operating lease assets for the subleasing

The cost of revenue for property management and subleasing business for the six months ended September 30, 2024 was $0.7 million,

approximately 140.3% of our total property management and subleasing business revenue, as compared with $$4,610 for the six months ended

September 30, 2023.

manufacturing business gross profit for the six months ended September 30, 2024 was $44,942, as compared with $23,300 for the six months

ended September 30, 2023.

Gross profit accounted for 19.1% of our total garment manufacturing business revenue for the six months ended

September 30, 2024, as compared to 16.1% for the six months ended September 30, 2023.

The cost of revenue for property management and subleasing business for the nine months ended December 31, 2024 was $1.0 million,

approximately 144.5% of our total property management and subleasing business revenue, as compared with $0.2 million, approximately 77.6%

of our total property managemet for the nine months ended December 31, 2023.

manufacturing business gross profit for the nine months ended December 31, 2024 was $50,562, as compared with $40,433 for the nine months

ended December 31, 2023.

Gross profit accounted for 18.8% of our total garment manufacturing business revenue for the nine months ended

December 31, 2024, as compared to 23.5% for the nine months ended December 31, 2023.

The increase of gross profit ratio was mainly due

to increased sales.

profit in our logistics services business for the six months ended September 30, 2024 was approximately $690,617 and gross margin was

Gross profit in our logistics services business for the six months ended September 30, 2023 was approximately $563,000 and gross

profit in our logistics services business for the nine months ended December 31, 2024 was approximately $875,162 and gross margin was

Gross profit in our logistics services business for the nine months ended December 31, 2023 was approximately $695,940 and gross

margin was 20.6%.

The increase of gross profit ratio was mainly because the Company re-allocated the orders received and reduced fuel

loss in our property management and subleasing business for the six months ended September 30, 2024 was $204,323.

loss in our property management and subleasing business for the nine months ended December 31, 2024 was $311,669.

Gross profit was $69,639

$53,500 for the six months ended September 30, 2023.

Gross loss accounted for (40.3)% of our total property management and

subleasing business revenue for the six months ended September 30, 2024, as compared to gross profit of 16.7% for the six months

ended September 30, 2023.

The decrease of gross profit ratio was mainly because the property management and subleasing business are

still in preliminary stage.

Six months ended September 30,

for the nine months ended December 31, 2023.

Gross loss accounted for (44.5)% of our total property management and subleasing business

revenue for the nine months ended December 31, 2024, as compared to gross profit of 22.4% for the nine months ended December 31, 2023.

The decrease was due to disposal of DY.

Nine months ended December 31,

Increase (decrease) in

7 unchanged sentences

(Loss) Income from operations

$ (1,131,136 )

$ (1,015,473 )

General and administrative expenses

selling expenses for our garment manufacturing business for the six months ended September 30, 2024 and 2023 was approximately $96,002

and nil, respectively.

The selling expenses for property management and subleasing business for the six months ended September 30, 2024

selling expenses for our garment manufacturing business for the nine months ended December 31, 2024 and 2023 was approximately $124,821

and $13,857, respectively.

The selling expenses for property management and subleasing business for the nine months ended December 31,

2024 and 2023 was approximately $148,836 and $118,676, respectively.

1 unchanged sentence

unloading charges and product inspection charges.

general and administrative expenses in our garment manufacturing business segment for the six months ended September 30, 2024 and 2023

general and administrative expenses in our garment manufacturing business segment for the nine months ended December 31, 2024 and 2023

was approximately $18,984 and $98,117, respectively.

Our general and administrative expenses in our logistics services segment for the

six months ended September 30, 2024 and 2023 was approximately $439,625 and $388,100, respectively.

nine months ended December 31, 2024 and 2023 was approximately $615,462 and $562,696, respectively.

The general and administrative expenses

in our property management and subleasing business was approximately $136,266 and nil for the six months ended September 30, 2024 and

2023, respectively.

Our general and administrative expenses in our corporate office for the six months ended September 30, 2024 and 2023

in our property management and subleasing business was approximately $180,056 and $132,336 for the nine months ended December 31, 2024

and 2023, respectively.

Our general and administrative expenses in our corporate office for the nine months ended December 31, 2024 and

2023 was approximately $657,032 and $891,914, respectively.

General and administrative expenses consisted primarily of administrative salaries,

office expense, certain depreciation and amortization charges, repairs and maintenance, legal and professional fees, warehousing costs

and other expenses that are not directly attributable to our revenues.

general and administrative expenses for the six months ended September 30, 2024 decreased by approximately 4.2% to $1.1 million from

$1.2 million for the six months ended September 30, 2023.

General and administrative expenses consisted primarily of administrative

salaries, office expense, certain depreciation and amortization charges, repairs and maintenance, legal and professional fees, warehousing

costs and other expenses that are not directly attributable to our revenues.

general and administrative expenses for the nine months ended December 31, 2024 decreased by approximately 12.7% to $1.5 million from

$1.7 million for the nine months ended December 31, 2023.

from operations

from operations for the six months ended September 30, 2024 and 2023 was approximately $750,082 and $565,881, respectively.

operations of approximately $62,023 and $41,100 for the six months ended September 30, 2024 and 2023, respectively, which was attributed

from our garment manufacturing segment.

Income from operations of approximately $250,437 and $174,200 was attributed from our logistics

services segment for the six months ended September 30, 2024 and 2023, respectively.

from operations for the nine months ended December 31, 2024 and 2023 was approximately $1.1 and $1.0, respectively.

Loss from operations

of approximately $93,243 and $71,541 for the nine months ended December 31, 2024 and 2023, respectively, which was attributed from our

garment manufacturing segment.

Income from operations of approximately $259,144 and $132,530 was attributed from our logistics services

segment for the nine months ended December 31, 2024 and 2023, respectively.

Loss from operations of approximately $640,562 and $181,372

$13,400 for the six months ended September 30, 2024 and 2023, respectively, which was attributed from our property management and subleasing

We incurred expenses from operations in corporate office of approximately $532,198 and $685,600 for the six months ended September

for the nine months ended December 31, 2024 and 2023, respectively, which was attributed from our property management and subleasing

We incurred expenses from operations in corporate office of approximately $656,475 and $895,090 for the nine months ended December

31, 2024 and 2023, respectively.

tax expense for the six months ended September 30, 2024 and 2023 was approximately $1,546 and $4,501, respectively.

tax expense for the nine months ended December 31, 2024 and 2023 was approximately $4,662 and $7,726, respectively.

Yingxi primarily

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No provision for income taxes

in Hong Kong has been made as Yingxi HK had no taxable income for the six months ended September 30, 2024 and 2023.

in Hong Kong has been made as Yingxi HK had no taxable income for the nine months ended December 31, 2024 and 2023.

and YX were incorporated in the PRC and is subject to the PRC Enterprise Income Tax (EIT) rate is 25%.

No provision for income taxes

in the PRC has been made as QYTG and YX had no taxable income for the six months ended September 30, 2024 and 2023.

in the PRC has been made as QYTG and YX had no taxable income for the nine months ended December 31, 2024 and 2023.

majority of our subsidiaries are governed by the Income Tax Laws of the PRC.

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has been made as Addentax Group Corp.

had no United States taxable income for the six months ended September 30, 2024 and 2023.

incurred net loss of approximately $1.9 million and $1.4 million for the six months ended September 30, 2024 and 2023, respectively.

Our basic and diluted earnings per share were ($0.36) and ($0.37) for the six months ended September 30, 2024 and 2023, respectively.

had no United States taxable income for the nine months ended December 31, 2024 and 2023.

incurred net loss of approximately $3.0 million and $4.0 million for the nine months ended December 31, 2024 and 2023, respectively.

Our basic and diluted earnings per share were ($0.53) and ($1.0) for the nine months ended December 31, 2024 and 2023, respectively.

of cash flows

cash flows information for the three months ended September 30, 2024 and 2023 is as follow:

Six months ended

September 30,

cash flows information for the three months ended December 31, 2024 and 2023 is as follow:

Nine months ended

Net cash provided by (used in) operating activities

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Net cash (used in) provided by financing activities

cash provided by operating activities in the six months ended September 30, 2024 was approximately $0.5 million as compared to net cash

used in operating activities of $1.6 million in the six months ended September 30, 2023, which was approximately $2.1 million more than

that of the six months ended September 30, 2023.

cash provided by operating activities in the nine months ended December 31, 2024 was approximately $0.8 million as compared to net cash

used in operating activities of $1.5 million in the nine months ended December 31, 2023, which was approximately $2.3 million more than

that of the nine months ended December 31, 2023.

The increase was mainly due to (i) net loss adjusted to operating cash flow for the

six months ended September 30, 2024 was $0.8 million less than that of the six months ended September 30, 2023;

nine months ended December 31, 2024 was $0.6 million less than that of the nine months ended December 31, 2023;

(ii) the movement of

operating assets and liabilities of the three months ended September 30, 2024 resulted in cash inflow of approximately $0.1 million,

which was $1.2 million more than that of 2023;.

cash used in investing activities for the six months ended September 30, 2024 was approximately $0.1 million, which was mainly due to

purchase of property, plant and equipment.

cash used in financing activities for the three months ended September 30, 2024 was approximately $0.4 million as compared to $1.0 million

in the three months ended September 30, 2023, which was approximately $2.7 million net cash provided by financing activities in the six

months ended September 30, 2023.

In the six months ended September 30, 2024, the Company received proceeds of $0.7 million from a private

placement and paid $1.0 million cash advance to related parties, while the Company had release of restricted cash of $3.85 million in

the six months ended September 30, 2023.

operating assets and liabilities of the three months ended December 31, 2024 resulted in cash outflow of approximately $0.1 million,

which was $1.1 million less than that of 2023;.

cash used in investing activities for the nine months ended December 31, 2024 was approximately $0.2 million, which was $0.3 million

less than the nine months ended December 31, 2023.

cash used in financing activities for the three months ended December 31, 2024 was approximately $1.0 million as compared to cash provided

by financing activities of $1.3 million in the three months ended December 31, 2023.

In the nine months ended December 31, 2024, the

Company received proceeds of $0.2 million from bank borrowings, $0.6 million of proceeds from issue of ordinary shares, loan to related

parties of $1.3 million, payment for redemption of convertible debts, and proceeds of $0.7 million from a private placement, while the

Company had release of restricted cash of $3.85 million in the nine months ended December 31, 2023.

Condition, Liquidity and Capital Resources

of September 30, 2024, we had cash on hand of approximately $0.8 million, total current assets of approximately $28.3 million and current

of December 31, 2024, we had cash on hand of approximately $0.5 million, total current assets of approximately $27.8 million and current

liabilities of approximately $3.2 million.

We currently finance our operations from revenue, fund raising from public offering

and private placement proceeds and capital contributions from our chief executive officer, Mr.

We currently finance our operations from revenue, fund raising from public offering and private

placement proceeds and capital contributions from our chief executive officer, Mr.

Hong Zhida (the “CEO”).

the event that the Company requires additional funding to finance the growth of the Company’s current and expected future

operations as well as to achieve our strategic objectives, the CEO has indicated the intent and ability to provide additional debt

or equity financing.

the event that the Company requires additional funding to finance the growth of the Company’s current and expected future operations

as well as to achieve our strategic objectives, the CEO has indicated the intent and ability to provide additional debt or equity financing.

Currency Translation Risk

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years, RMB continued to appreciate against the U.S.

As of September 30, 2024, the market foreign exchange rate was RMB 7.02 to

As of December 31, 2024, the market foreign exchange rate was RMB 7.30 to

Our financial statements are translated into U.S.

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All translation adjustments are included in accumulated other comprehensive income in the statement of

The foreign currency translation gain (loss) for the six months ended September 30, 2024 and 2023 was approximately $(0.05) million

The foreign currency translation gain (loss) for the nine months ended December 31, 2024 and 2023 was approximately $0.06 million

and $0.05 million, respectively.

Sheet Arrangements

have no off-balance sheet arrangements (as that term is defined in Item 303(a)(4)(ii) of Regulation S-K) as of September 30, 2024 that

have no off-balance sheet arrangements (as that term is defined in Item 303(a)(4)(ii) of Regulation S-K) as of December 31, 2024 that

have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues

3 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis