What changed in this filing

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Item 1. Financial Statements

2025-08-14 compared with 2025-05-09 · 328 added, 239 removed, 882 unchanged (39% of the section changed)

2 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2025 AND DECEMBER 31, 2024

AS OF JUNE 30, 2025 AND DECEMBER 31, 2024

Current Assets

1 unchanged sentence

Restricted cash

Accounts receivable (net of allowance for doubtful accounts of $ 90,730 and $ 53,111 as of March 31, 2025 and December 31, 2024, respectively)

Accounts receivable (net of allowance for doubtful accounts of $ 85,010 and $ 53,111 as of June 30, 2025 and December 31, 2024, respectively)

Prepayments and other current assets

5 unchanged sentences

Value-added tax recoverable

Deferred tax asset non-current

$ 175,162,562

15 unchanged sentences

Derivative liability

Total liabilities (including amounts of the consolidated VIE without recourse to the Company of $ 17,753,460 and $ 16,976,765 as of March 31, 2025 and December 31, 2024, respectively)

Total liabilities (including amounts of the consolidated VIE without recourse to the Company of $ 18,094,307 and $ 16,976,765 as of June 30, 2025 and December 31, 2024, respectively)

Commitments and Contingencies

Stockholders’ Equity

Common stock, 50,000,000 shares authorized, $ 0.001 par value per share, 10,065,920 shares issued and outstanding as of March 31, 2025 and December, 31, 2024.

Common stock $ 0.001 par value per share;

50,000,000 shares;

Issued and outstanding:

16,965,420 shares as of June 30, 2025 and 10,065,920 shares as of December, 31, 2024, respectively.

Additional paid-in capital

13 unchanged sentences

AND COMPREHENSIVE INCOME

FOR THE THREE MONTHS ENDED MARCH 31, 2025 AND

FOR THE THREE AND SIX MONTHS ENDED JUNE 30,

2025 AND 2024

Three Months Ended

Six Months Ended

Cost of sales

1 unchanged sentence

( 22,984,488 )

( 34,334,076 )

( 29,449,216 )

Selling, general and administrative expenses

1 unchanged sentence

( 2,717,548 )

Loss from Operations

( 6,498,096 )

( 6,618,331 )

(Loss) Income from Operations

( 1,763,030 )

( 5,140,265 )

( 2,953,918 )

Other Income (Expense):

2 unchanged sentences

Gain on derivative liability

Loss before Income Taxes

(Loss) Income before Income Taxes

( 1,904,998 )

( 5,408,783 )

Income Tax (Expenses) Benefits

( 3,370,720 )

Income Tax Expenses

( 1,951,826 )

( 5,455,611 )

( 3,824,283 )

Other Comprehensive Income (Loss)

Foreign currency translation adjustment

( 1,057,769 )

Total Comprehensive Loss

1 unchanged sentence

$ ( 833,897 )

$ ( 4,795,870 )

$ ( 4,882,052 )

Losses Per Share:

5 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2025 AND

Three Months Ended

FOR THE SIX MONTHS ENDED JUNE 30, 2025 AND 2024

Six Months Ended

Cash Flows from Operating Activities:

3 unchanged sentences

Depreciation and amortization

(Gain) Loss on derivative liability

Gain on derivative liability

Allowance for bad debts

6 unchanged sentences

( 2,694,397 )

( 1,751,011 )

Accounts payable

11 unchanged sentences

Cash Flows from Financing Activities:

Proceeds from issuance of shares

Proceeds from short term bank loans

Repayment of bank loans

Net Cash Provided by Financing Activities

Effect of Exchange Rate Changes on Cash and Cash Equivalents

Net (Decrease) Increase in Cash and Cash Equivalents

( 1,880,216 )

Net Increase in Cash and Cash Equivalents

Cash, Cash Equivalents and Restricted Cash - Beginning of Period

11 unchanged sentences

IN STOCKHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED MARCH 31, 2025 AND

FOR THE SIX MONTHS ENDED JUNE 30, 2025 AND 2024

Comprehensive

Income (loss)

Balance at December 31, 2023

4 unchanged sentences

( 1,057,769 )

Balance at March 31, 2024

( 3,824,283 )

Balance at June 30, 2024

$ ( 11,613,303 )

$ 163,454,811

Balance at December 31, 2024

1 unchanged sentence

$ 156,050,317

Issuance of shares to institutional investor

Foreign currency translation adjustment

1 unchanged sentence

( 5,455,611 )

Balance at March 31, 2025

Balance at June 30, 2025

$ ( 12,339,245 )

126 unchanged sentences

The revenue generated from Dongfang Paper and Tengsheng Paper for the

three months ended March 31, 2025 and 2024 was accounted for 100 % of the Company’s total revenue.

Dongfang Paper and Tengsheng Paper

also accounted for 96.27 % and 96.07 % of the total assets of the Company as of March 31, 2025 and December 31, 2024, respectively.

As of March 31, 2025 and December 31, 2024, details of the Company’s

three and six months ended June 30, 2025 and 2024 was accounted for 100 % of the Company’s total revenue.

Dongfang Paper and Tengsheng

Paper also accounted for 95.93 % and 96.07 % of the total assets of the Company as of June 30, 2025 and December 31, 2024, respectively.

As of June 30, 2025 and December 31, 2024, details of the Company’s

subsidiaries and variable interest entities are as follows:

30 unchanged sentences

The aggregate carrying value of Dongfang Paper’s assets and liabilities (after elimination

of intercompany transactions and balances) in the Company’s condensed consolidated balance sheets as of March 31, 2025 and December

of intercompany transactions and balances) in the Company’s condensed consolidated balance sheets as of June 30, 2025 and December

31, 2024 are as follows:

50 unchanged sentences

Such adjustments are of a normal recurring nature, unless otherwise noted.

The balance sheet as of March 31,

2025 and the results of operations for the three months ended March 31, 2025 are not necessarily indicative of the results to be expected

The balance sheet as of June 30,

2025 and the results of operations for the six months ended June 30, 2025 are not necessarily indicative of the results to be expected

for any future period.

8 unchanged sentences

Liquidity and Going Concern

As of March 31, 2025, the Company had current

assets of $ 29,499,038 (including a VAT （“Value Added Tax”）recoverable of Tengsheng Paper in amount of $ 13,173,067 ),

As of June 30, 2025, the Company had current assets

of $ 32,644,518 (including a VAT （“Value Added Tax”）recoverable of Tengsheng Paper in amount of $ 13,209,135 ),

and current liabilities of $ 21,341,552 , resulting in a working capital of $ 11,302,966 .

However, production of Baoding Shende has been suspended

in 2024 and the first quarter of 2025, rendering related VAT unrecoverable in the short term.

Net working capital excluding VAT recoverable

as of March 31, 2025 was a working capital deficit of $ 4,607,992 .

Baoding Shengde and Tengsheng Paper have incurred loss that there is

doubt about these subsidiaries ability to continue as going concerns.

The main reason of losses was due to high depreciation costs, decreased

market demand, and elevated material costs.

Therefore, there was a substantial doubt about the ability of the Company to continue as a

going concern that it may be unable to realize its assets and discharge its liabilities in the normal course of business as of March 31,

However, production of Baoding Shende has been

suspended in 2024 and the six months ended June 30, 2025, rendering related VAT unrecoverable in the short term.

Net working capital excluding

VAT recoverable as of June 30, 2025 was a working capital deficit of $ 1,906,169 .

Baoding Shengde and Tengsheng Paper have incurred loss

that there is doubt about these subsidiaries ability to continue as going concerns.

The main reason of losses was due to high depreciation

costs, decreased market demand, and elevated material costs.

Therefore, there was a substantial doubt about the ability of the Company

to continue as a going concern that it may be unable to realize its assets and discharge its liabilities in the normal course of business

as of June 30, 2025.

IT TECH PACKAGING, INC.

1 unchanged sentence

To address these challenges, the Company plans

to optimize its raw material structure and stabilize manufacturing capacity utilization, which will help to reduce procurement costs.

Additionally, the Company is actively exploring new products and adjusting pricing strategies in a timely manner to secure a larger market

to optimize its raw material structure and stabilize manufacturing capacity utilization, which will help to reduce procurement and production

Additionally, the Company is actively exploring new products and adjusting pricing strategies in a timely manner to secure a larger

market share.

Furthermore, the Company will maintain rigorous

34 unchanged sentences

IT TECH PACKAGING, INC.

NOTES TO CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL

Classification within the hierarchy is determined based on the lowest

4 unchanged sentences

Accordingly, the estimates of fair value may not be indicative of the amounts that the Company could realize in a current market exchange.

As of March 31, 2025 and December 31, 2024, the carrying value of the Company’s short term financial instruments, such as cash and

cash equivalents, accounts receivable, accounts and notes payable, short-term bank loans, balance due to a related party and obligation

under capital lease, approximate at their fair values because of the short maturity of these instruments;

while loans from credit union

and loans from a related party approximate at their fair value as the interest rates thereon are close to the market rates of interest

published by the People’s Bank of China.

As of June 30, 2025 and December 31, 2024, the carrying value of the Company’s short term financial instruments, such as cash and

cash equivalents, accounts receivable, accounts and short-term bank loans and balance due to a related party, approximate at their fair

values because of the short maturity of these instruments;

while loans from credit union and loans from a related party approximate at

their fair value as the interest rates thereon are close to the market rates of interest published by the People’s Bank of China.

Management determined that liabilities created

27 unchanged sentences

Restricted cash of $ 1,038,874 and $ 1,034,203 as

of March 31, 2025 and December 31, 2024 was presented for the cash deposited at the Industrial and Commercial Bank of China of Tengsheng

The deposit was restricted due to the legal proceeding against Tengsheng Paper and Jie Ping, who served as the executive director

of June 30, 2025 and December 31, 2024 was presented for the cash deposited mainly at the Industrial and Commercial Bank of China of Tengsheng

The deposits were restricted due to the legal proceeding against Tengsheng Paper and Jie Ping, who served as the executive director

and the legal representative of Tengsheng Paper.

4 unchanged sentences

and tissue paper products.

Inventories consisted of the following as of March 31, 2025 and December 31, 2024:

Inventories consisted of the following as of June 30, 2025 and December 31, 2024:

Raw Materials

8 unchanged sentences

The movement of inventory reserve was as follows:

Three Months Ended

Six Months Ended

Balance at beginning of year

6 unchanged sentences

Prepayments and other current assets consisted of the following as

of March 31, 2025 and December 31, 2024:

of June 30, 2025 and December 31, 2024:

Prepayment for purchase of materials

2 unchanged sentences

Allowance for doubtful accounts

The movement of allowance for doubtful

accounts was as follows:

Three Months Ended

The movement of allowance for doubtful accounts was as follows:

Six Months Ended

Balance at beginning of year

3 unchanged sentences

(6) Property, plant and equipment, net

As of March 31, 2025 and December 31, 2024, property, plant and equipment

As of June 30, 2025 and December 31, 2024, property, plant and equipment

consisted of the following:

9 unchanged sentences

$ 146,911,883

As of March 31, 2025 and December 31, 2024, land

use rights represented twenty three parcels of state-owned lands located in Xushui District and Wei County of Hebei Province in China,

As of June 30, 2025 and December 31, 2024, land

use rights represented twenty four parcels of state-owned lands located in Xushui District and Wei County of Hebei Province in China,

with lease terms of 50 years expiring in 2061 and 2068, respectively.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

As of March 31, 2025 and December 31, 2024, certain

As of June 30, 2025 and December 31, 2024, certain

property, plant and equipment of Dongfang Paper with net values of $ nil , have been pledged pursuant to a long-term loan from credit union

of Dongfang Paper.

Certain property, plant and equipment of Baoding Shengde with net value of $ 3,028,097 and $ 3,407,848 , repectively,

as of March 31, 2025 and December 31, 2024, have been pledged pursuant two short-term loans from credit union of Baoding Shengde.

Certain property, plant and equipment of Baoding Shengde with net value of $ 2,650,742 and $ 3,407,848 , respectively,

as of June 30, 2025 and December 31, 2024, have been pledged pursuant two short-term loans from credit union of Baoding Shengde.

property, plant and equipment of Dongfang Paper with net values of $ 159,991 was pledged for a short-term loan from Bank of Cangzhou.

2 unchanged sentences

Depreciation and amortization of property, plant

and equipment was $ 3,547,398 and $ 3,481,788 for the three months ended March 31, 2025 and 2024, respectively.

and equipment was $ 3,543,184 and $ 3,381,095 for the three months ended June 30, 2025 and 2024, respectively.

Depreciation and amortization

of property, plant and equipment was $ 7,090,582 and $ 6,862,883 for the six months ended June 30, 2025 and 2024, respectively.

Operating lease lessor

The Company has a non-cancellable agreement to

The Company had a non-cancellable agreement to

lease plant to tenant under operating lease for 1 year from November 2023 to November 2024 .

The lease does not contain contingent payments.

The lease did not contain contingent payments.

The rental income of the year was paid in advance by the tenant in December 2023.

15 unchanged sentences

IT TECH PACKAGING, INC.

NOTES TO CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL

The components of the Company’s lease expense are as follows:

Six Months Ended

Operating lease cost

1 unchanged sentence

Supplemental cash flow information related to its operating leases

was as follows for the period ended March 31, 2025:

was as follows for the period ended June 30, 2025:

Cash paid for amounts included in the measurement of lease liabilities:

Three Months Ended

March 31, 2025

Six Months Ended

Cash paid for amounts included in the measurement of lease liabilities:

1 unchanged sentence

Maturities of its lease liabilities for all operating leases are as

follows as of March 31, 2025:

follows as of June 30, 2025:

Total operating lease payments

3 unchanged sentences

The weighted average remaining lease terms and discount rates for all

of its operating leases were as follows as of March 31, 2025:

of its operating leases were as follows as of June 30, 2025:

Remaining lease term and discount rate:

2 unchanged sentences

IT TECH PACKAGING, INC.

NOTES TO CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL

(8) Loans Payable

7 unchanged sentences

Total short-term bank loans

On December 24, 2024, the Company entered into a loan agreement with

the Rural Credit Union of Xushui District, with a balance of $ 1,811,039 and $ 1,808,469 as of March 31, 2025 and December 31, 2024, respectively.

On December 24, 2024, the Company entered into

a loan agreement with the Rural Credit Union of Xushui District, with a balance of $ 1,815,998 and $ 1,808,469 as of June 30, 2025 and December

31, 2024, respectively.

The loan is secured by the equipment of Baoding Shengde as collateral for the benefit of the bank.

The loan bears a fixed rate of 6 % and

will be due by December 23, 2025 .

On December 24, 2024, the Company entered into a loan agreement with

the Rural Credit Union of Xushui District, with a balance of $ 2,228,971 and $ 2,225,808 as of March 31, 2025 and December 31, 2024, respectively.

The loan is secured by the equipment of Baoding Shengde as collateral for the benefit of the bank and guaranteed by a third party company.

The loan bears

a fixed rate of 6 % and will be due by December 23, 2025 .

On December 24, 2024, the Company entered into

a loan agreement with the Rural Credit Union of Xushui District, with a balance of $ 2,235,074 and $ 2,225,808 as of June 30, 2025 and December

31, 2024, respectively.

The loan is secured by the equipment of Baoding Shengde as collateral for the benefit of the bank and guaranteed

by a third party company.

The loan bears a fixed rate of 6 % and will be due by December 23, 2025 .

2 unchanged sentences

guaranteed by Mr.

Zhenyong Liu.

Liu Zhenyong.

The loan will be due by December 27, 2025.

2 unchanged sentences

secured by the Company’s manufacturing equipment and guaranteed by Mr.

Zhenyong Liu.

Liu Zhenyong.

The loan will be due by December 27, 2025.

3 unchanged sentences

by the Company’s manufacturing equipment and guaranteed by Mr.

Zhenyong Liu.

Liu Zhenyong.

The loan will be due by March 9, 2026.

On June 11, 2024, the Company entered into a working

capital loan agreement with the ICBC, with a balance of $ 2,786 and $ 2,782 as of March 31, 2025 and December 31, 2024, respectively.

loan bears a fixed interest rate of 3.45 % per annum.

capital loan agreement with the ICBC, with a balance of $ nil and $ 2,782 as of June 30, 2025 and December 31, 2024, respectively.

bore a fixed interest rate of 3.45 % per annum.

The loan was repaid on June 10, 2025.

On June 21, 2024, the Company entered into a working

capital loan agreement with the ICBC, with a balance of $ nil and $ 139,113 as of June 30, 2025 and December 31, 2024, respectively.

loan bore a fixed interest rate of 3.45 % per annum.

The loan is was repaid on June 3, 2025.

On June 22, 2024, the Company entered into a working

capital loan agreement with the ICBC, with a balance of $ nil and $ 139,113 as of June 30, 2025 and December 31, 2024, respectively.

loan bore a fixed interest rate of 3.45 % per annum.

The loan was repaid on June 10, 2025.

IT TECH PACKAGING, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL

On June 24, 2024, the Company entered into a working

capital loan agreement with the ICBC, with a balance of $ nil and $ 136,331 as of as of June 30, 2025 and December 31, 2024, respectively.

The loan bore a fixed interest rate of 3.45 % per annum.

The loan was repaid on June 9, 2025.

On June 10, 2025, the Company entered into a working

capital loan agreement with the ICBC, with a balance of $ 2,794 as of June 30, 2025.

The loan bears a fixed interest rate of 3.00 % per

The loan is due for repayment by June 10, 2026.

On June 3, 2025, the Company entered into a working

capital loan agreement with the ICBC, with a balance of $ 139,311 and $ 139,113 as of March 31, 2025 and December 31, 2024, respectively.

The loan bears a fixed interest rate of 3.45 % per annum.

capital loan agreement with the ICBC, with a balance of $ 139,692 as of June 30, 2025.

The loan bears a fixed interest rate of 3.00 % per

The loan is due for repayment by June 3, 2026.

On June 10, 2025, the Company entered into a working

capital loan agreement with the ICBC, with a balance of $ 139,311 and $ 139,113 as of March 31, 2025 and December 31, 2024, respectively.

The loan bears a fixed interest rate of 3.45 % per annum.

capital loan agreement with the ICBC, with a balance of $ 139,692 as of June 30, 2025.

The loan bears a fixed interest rate of 3.00 % per

The loan is due for repayment by June 10, 2026.

IT TECH PACKAGING, INC.

NOTES TO CONDENSED CONSOLIDATED

FINANCIAL STATEMENTS

On June 9, 2025, the Company entered into a working

capital loan agreement with the ICBC, with a balance of $ 136,524 and $ 136,331 as of as of March 31, 2025 and December 31, 2024, respectively.

The loan bears a fixed interest rate of 3.45 % per annum.

capital loan agreement with the ICBC, with a balance of $ 136,898 as of June 30, 2025.

The loan bears a fixed interest rate of 3.00 % per

The loan is due for repayment by June 9, 2026.

As of March 31, 2025, there were guaranteed short-term

As of June 30, 2025, there were guaranteed short-term

borrowings of $ 2,821,781 and unsecured bank loans of $ 419,076 .

2 unchanged sentences

The average short-term borrowing rates for the

three months ended March 31, 2025 and 2024 were approximately 5.74 % and 4.48 %, respectively.

three months ended June 30, 2025 and 2024 were approximately 5.72 % and 4.45 %, respectively.

The average short-term borrowing rates for

the six months ended June 30, 2025 and 2024 were approximately 5.73 % and 4.46 %, respectively.

Long-term loans

As of March 31, 2025 and December 31, 2024, long-term

As of June 30, 2025 and December 31, 2024, long-term

loans were $ 4,692,258 and $ 4,672,806 , respectively.

5 unchanged sentences

Long-term loans

As of March 31, 2025, the Company’s long-term

As of June 30, 2025, the Company’s long-term

debt repayments for the next coming years were as follows:

Remainder of 2025

On July 15, 2013, the Company entered into a

loan agreement with the Rural Credit Union of Xushui District for a term of 5 years, which was originally due and payable in various

installments from December 21, 2013 to July 26, 2018.

On June 21, 2018, the loan was extended for additional 5 years and was due and

payable in various installments from December 21, 2018 to June 20, 2023.

On August 24, 2023, the loan was extended for another 3 years

and will be due and payable on August 24, 2026 .

The loan is secured by certain of the Company’s manufacturing equipment with net

book value of $ nil as of March 31, 2025 and December 31, 2024.

On July 15, 2013, the Company entered into a loan

agreement with the Rural Credit Union of Xushui District for a term of 5 years, which was originally due and payable in various installments

from December 21, 2013 to July 26, 2018.

On June 21, 2018, the loan was extended for additional 5 years and was due and payable in various

installments from December 21, 2018 to June 20, 2023.

On August 24, 2023, the loan was extended for another 3 years and will be due and

payable on August 24, 2026 .

The loan is secured by certain of the Company’s manufacturing equipment with net book value of $ nil

as of June 30, 2025 and December 31, 2024.

Interest payment is due monthly and bore a rate of 7.68 % per annum.

from November 15, 2022, the interest rate was reduced to 7 % per annum.

As of March 31, 2025 and December 31, 2024, the total outstanding

loan balance was $ 3,481,375 and $ 3,476,434 .

Out of the total outstanding loan balance, current portion amounted was $ 2,645,510 and $ 2,641,756 ,

which is presented as current liabilities in the consolidated balance sheet and the remaining balance of $ 835,865 and $ 834,678 is presented

as non-current liabilities in the consolidated balance sheet as of March 31, 2025 and December 31, 2024, respectively.

Effective from November

15, 2022, the interest rate was reduced to 7 % per annum.

Effective from December 3, 2024, the interest rate was reduced to 6 % per annum.

As of June 30, 2025 and December 31, 2024, the total outstanding loan balance was $ 3,490,906 and $ 3,476,434 .

Out of the total outstanding

loan balance, current portion amounted was $ 2,652,753 and $ 2,641,756 , which is presented as current liabilities in the consolidated balance

sheet and the remaining balance of $ 838,153 and $ 834,678 is presented as non-current liabilities in the consolidated balance sheet as

of June 30, 2025 and December 31, 2024, respectively.

IT TECH PACKAGING, INC.

1 unchanged sentence

On December 5, 2023, the Company entered into

a loan agreement with the Rural Credit Union of Xushui District for a term of 3 years, which was due in various installments from June

a loan agreement with the Rural Credit Union of Xushui District for a term of 3 years, which is due in various installments from June

21, 2024 to December 5, 2026 .

2 unchanged sentences

7 % per annum.

As of March 31, 2025 and December 31, 2024, total outstanding loan balance was $ 1,198,072 and $ 1,196,372 , respectively.

Out of the total outstanding loan balance, current portion amounted $ 919,451 and $ 918,146 , which is presented as current liabilities and

the remaining balance of $ 278,621 and $ 278,226 is presented as non-current liabilities in the consolidated balance sheet as of March 31,

2025 and December 31, 2024, respectively.

Effective from December 3, 2024, the interest rate was reduced to 6 % per annum.

As of June 30, 2025 and December 31, 2024,

total outstanding loan balance was $ 1,201,352 and $ 1,196,372 , respectively.

Out of the total outstanding loan balance, current portion

amounted $ 921,968 and $ 918,146 , which is presented as current liabilities and the remaining balance of $ 279,384 and $ 278,226 is presented

as non-current liabilities in the consolidated balance sheet as of June 30, 2025 and December 31, 2024, respectively.

Total interest expenses for the short-term bank

loans and long-term loans for the three months ended March 31, 2025 and 2024 were $ 132,847 and $ 209,586 , respectively.

loans and long-term loans for the three months ended June 30, 2025 and 2024 were $ 143,971 and $ 211,551 , respectively.

Total interest expenses

for the short-term bank loans and long-term loans for the six months ended June 30, 2025 and 2024 were $ 276,818 and $ 421,841 , respectively.

(9) Related Party Transactions

Zhenyong Liu has loaned money to Dongfang

Liu Zhenyong had loaned money to Dongfang

Paper for working capital purposes over a period of time.

On January 1, 2013, Dongfang Paper and Mr.

Zhenyong Liu renewed the three-year

Liu Zhenyong renewed the three-year

term loan previously entered on January 1, 2010, and extended the maturity date further to December 31, 2015 .

1 unchanged sentence

Company paid off the loan of $ 2,249,279 , together with interest of $ 391,374 for the period from 2013 to 2015.

Approximately $ 357,100

and $ 356,594 of interest were outstanding to Mr.

Zhenyong Liu, which were recorded in other payables and accrued liabilities as part

of the current liabilities in the consolidated balance sheet as of March 31, 2025 and December 31, 2024, respectively.

Approximately $ 358,078 and

$ 356,594 of interest were outstanding to Mr.

Liu Zhenyong, which were recorded in other payables and accrued liabilities as part of the

current liabilities in the consolidated balance sheet as of June 30, 2025 and December 31, 2024, respectively.

On December 10, 2014, Mr.

Zhenyong Liu provided

Liu Zhenyong provided

a loan to the Company, amounted to $ 8,742,278 to Dongfang Paper for working capital purpose with an interest rate of 4.35 % per annum,

3 unchanged sentences

During the year of 2016, the Company repaid $ 6,012,416 to Mr.

Zhenyong Liu, together with

Liu Zhenyong, together with

interest of $ 288,596 .

In February 2018, the company paid off the remaining balance, together with interest of $ 20,400 .

As of March 31,

As of June 30,

2025 and December 31, 2024, approximately $ 41,908 and $ 41,734 of interest were outstanding to Mr.

Zhenyong Liu, which was recorded in

Liu Zhenyong, which was recorded in

other payables and accrued liabilities as part of the current liabilities in the consolidated balance sheet.

On March 1, 2015, the Company entered an agreement

Zhenyong Liu which allows Dongfang Paper to borrow from the CEO an amount up to $ 17,201,342 (RMB 120,000,000 ) for working capital

Liu Zhenyong which allows Dongfang Paper to borrow from the CEO an amount up to $ 17,201,342 (RMB 120,000,000 ) for working capital

The advances or funding under the agreement are due three years from the date each amount is funded.

5 unchanged sentences

In February 2018, the company repaid $ 1,507,432 to Mr.

Zhenyong Liu.

Liu Zhenyong.

The loan would be originally due on

July 12, 2018 .

Zhenyong Liu agreed to extend the loan for additional 3 years and the remaining balance will be due on July 12, 2021.

Liu Zhenyong agreed to extend the loan for additional 3 years and the remaining balance will be due on July 12, 2021.

On November 23, 2018, the company repaid $ 3,768,579 to Mr.

Zhenyong Liu, together with interest of $ 158,651 .

Liu Zhenyong, together with interest of $ 158,651 .

In December 2019, the Company

paid off the remaining balance, together with interest of 94,636 .

As of March 31, 2025 and December 31, 2024, the outstanding interest

As of June 30, 2025 and December 31, 2024, the outstanding interest

was $ 191,989 and $ 191,193 , respectively, which was recorded in other payables and accrued liabilities as part of the current liabilities

in the consolidated balance sheet.

As of March 31, 2025 and December 31, 2024, total

As of June 30, 2025 and December 31, 2024, total

amount of loans due to Mr.

Zhenyong Liu were $ nil .

Liu Zhenyong were $ nil .

The interest expense incurred for such related party loans were $ nil for the three

months ended March 31, 2025 and 2024.

and six months ended June 30, 2025 and 2024.

The net interest owed to Mr.

Zhenyong Liu was approximately $ 305,033 and $ 304,600 , as of March 31,

2025 and December 31, 2024, respectively, which was recorded in other payables and accrued liabilities.

Liu Zhenyong was approximately $ 305,868 and $ 304,600 , as of

June 30, 2025 and December 31, 2024, respectively, which was recorded in other payables and accrued liabilities.

In October 2022 and November 2022, the Company

1 unchanged sentence

Zhenyong Liu, which allowed Mr.

Zhenyong Liu to borrow from the Company an amount of $ 7,059,455 (RMB 50,000,000 )

Liu Zhenyong to borrow from the Company an amount of $ 7,059,455 (RMB 50,000,000 )

The loans were unsecured and carried a fixed interest rate of 4.35 % per annum.

$ 4,235,673 (RMB 30,000,000 ) was repaid by Mr.

Zhengyong Liu in August 2023 and the remaining balance was repaid in December 2023.

Interest income of the loan for the three months ended

March 31, 2025 and 2024 were $ nil .

As of March 31, 2025 and December 31, 2024, amount

due to shareholder was $ 10,000 and $ nil , respectively, which represents funds from shareholders to pay for various expenses incurred in

Liu Zhengyong in August 2023 and the remaining balance was repaid in December 2023.

Interest income of the loan for the three and six

months ended June 30, 2025 and 2024 were $ nil .

As of June 30, 2025 and December 31, 2024, amount

Liu Zhenyong was $ 119,974 and $1,242 , respectively, which mainly represents funds from Mr.

Liu Zhenyong to pay for various

expenses incurred in the U.S.

The amount is due on demand with interest free.

18 unchanged sentences

The Company determined its derivative liabilities

to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the fair value as of March 31, 2025.

Black-Scholes model requires six basic data inputs:

the exercise or strike price, time to expiration, the risk-free interest rate, the

current stock price, the estimated volatility of the stock price in the future, and the dividend rate.

Changes to these inputs could produce

a significantly higher or lower fair value measurement.

The fair value of each warrant is estimated using the Black-Scholes valuation

The following weighted-average assumptions were used in the March 31, 2025:

March 31, 2025

to be a Level 3 fair value measurement and used the Black-Scholes pricing model to calculate the fair value as of June 30, 2025.

The Black-Scholes

model requires six basic data inputs:

the exercise or strike price, time to expiration, the risk-free interest rate, the current stock

price, the estimated volatility of the stock price in the future, and the dividend rate.

Changes to these inputs could produce a significantly

higher or lower fair value measurement.

The fair value of each warrant is estimated using the Black-Scholes valuation model.

The following

weighted-average assumptions were used in the June 30, 2025:

Expected term

4 unchanged sentences

The following table summarizes the changes in

the derivative liabilities during the three months ended March 31, 2025:

the derivative liabilities during the six months ended June 30, 2025:

Fair Value Measurements Using Significant Observable Inputs (Level

1 unchanged sentence

Change in fair value of derivative liability

Balance at March 31, 2025

Balance at June 30, 2025

IT TECH PACKAGING, INC.

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Issuance of common stock to investors

On January 20, 2021, the Company offered and sold

to certain institutional investors an aggregate of 2,618,182 shares of common stock and 2,618,182 warrants to purchase up to 2,618,182

shares of common stock in a best-efforts public offering for gross proceeds of approximately $ 14.4 million.

The purchase price for each

share of common stock and the corresponding warrant was $ 5.5 .

The exercise price of the warrant was $ 5.5 per share.

On March 1, 2021, the Company offered and sold

to the public investors an aggregate of 2,927,786 shares of common stock and 1,463,893 warrants to purchase up to 1,463,893 shares of

common stock in a firm commitment underwritten public offering for gross proceeds of approximately $ 21.9 million.

The purchase price for

each share of common stock and accompanying warrant was $ 7.5 .

The exercise price of the warrant was $ 7.5 per share.

On May 13, 2025, the Company entered into a securities purchase agreement

with an institutional investor (the “Purchaser”), pursuant to which the Company agreed to sell and issue to the Purchaser,

in a public offering that included certain additional other purchasers, an aggregate of 6,899,500 shares of common stock, par value $ 0.001 ,

at a purchase price of $ 0.20 per share, for aggregate gross proceeds to the Company of approximately $ 1.4 million, before deducting the

placement agent fees and estimated offering expenses payable by the Company.

(13) Warrants

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88,000 May 2020 Warrants were exercised in February 2021 at the exercise price of $ 7.425 per share and

352,000 May 2020 Warrants were outstanding as of March 31, 2025.

352,000 May 2020 Warrants were outstanding as of June 30, 2025.

On January 20, 2021, the Company offered and sold

5 unchanged sentences

of 2021 at the exercise price of $ 5.5 per share.

1,207,492 January 2021 Warrants were outstanding as of March 31, 2025.

1,207,492 January 2021 Warrants were outstanding as of June 30, 2025.

On March 1, 2021, the Company offered and sold

4 unchanged sentences

6,750 March 2021 Warrants were exercised in January and March 2021 at the exercise price of

$ 7.5 per share and 1,457,143 March 2021 Warrants were outstanding as of March 31, 2025.

$ 7.5 per share and 1,457,143 March 2021 Warrants were outstanding as of June 30, 2025.

The Company classified warrants as liabilities and accounted for the

3 unchanged sentences

A summary of stock warrant activities is as below:

Three months ended

March 31, 2025

Six months ended

Weight average

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The following table summarizes information relating to outstanding

and exercisable warrants as of March 31, 2025:

and exercisable warrants as of June 30, 2025:

Warrants Outstanding Warrants Exercisable

7 unchanged sentences

Aggregate intrinsic value is the sum of the amounts

by which the quoted market price of the Company’s stock exceeded the exercise price of the warrants at March 31, 2025 for those

warrants for which the quoted market price was in excess of the exercise price (“in-the-money” warrants).

The intrinsic value

of the warrants as of March 31, 2025 and December 31, 2024 are nil .

by which the quoted market price of the Company’s stock exceeded the exercise price of the warrants at June 30, 2025 for those warrants

for which the quoted market price was in excess of the exercise price (“in-the-money” warrants).

The intrinsic value of the

warrants as of June 30, 2025 and December 31, 2024 are nil .

(14) Earnings Per Share

For the three months ended March 31, 2025 and 2024, basic and diluted

For the three months ended June 30, 2025 and 2024, basic and diluted

net loss per share are calculated as follows:

3 unchanged sentences

$ ( 1,951,826 )

$ ( 3,746,536 )

Weighted average common stock outstanding - denominator

Net loss per share

Diluted income per share

Net income for the period- numerator

$ ( 3,503,785 )

Diluted loss per share

Net loss for the period- numerator

$ ( 1,951,826 )

5 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the six months ended June 30, 2025 and 2024, basic and diluted

net loss per share are calculated as follows:

Six Months Ended

Basic loss per share

Net loss for the period - numerator

$ ( 5,455,611 )

$ ( 3,824,283 )

Weighted average common stock outstanding - denominator

Net loss per share

Diluted loss per share

Net loss for the period - numerator

$ ( 5,455,611 )

$ ( 3,824,283 )

Weighted average common stock outstanding - denominator

Effect of dilution

Weighted average common stock outstanding - denominator

Diluted loss per share

(15) Income Taxes

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No provision for the US federal income taxes has been made as the Company had no US taxable

income for the first quarter ended March 31, 2025, and management believes that its earnings are permanently invested in the PRC.

income for the second quarter ended June 30, 2025, and management believes that its earnings are permanently invested in the PRC.

Dongfang Paper and Baoding Shengde are PRC operating

3 unchanged sentences

The provisions for income taxes for three months

ended March 31, 2025 and 2024 were as follows:

ended June 30, 2025 and 2024 were as follows:

Three Months Ended

4 unchanged sentences

Total Income Tax Expenses (Benefits)

IT TECH PACKAGING, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The provisions for income taxes for six months ended June 30, 2025

and 2024 were as follows:

Six Months Ended

Provision for Income Taxes

Current Tax Provision U.S.

Current Tax Provision PRC

Deferred Tax Provision PRC

Total Income Tax Expenses (Benefits)

In addition to the reversible future PRC income

5 unchanged sentences

These carry forwards would expire, if not utilized, during the period of 2030 through 2035.

As of March 31, 2025, management believed that the realization of all the U.S.

income tax benefits from these losses, which generally

would generate a deferred tax asset if it can be expected to be utilized in the future, appears not more than likely due to the Company’s

As of June 30, 2025, management believed that the realization of all the U.S.

income tax benefits from these losses, which generally would

generate a deferred tax asset if it can be expected to be utilized in the future, appears not more than likely due to the Company’s

limited operating history and continuing losses for United States income tax purposes.

Accordingly, As of March 31, 2025 and December

Accordingly, as of June 30, 2025 and December 31,

2024, the Company provided a 100 % valuation allowance on the U.S.

deferred tax asset benefit to reduce the total deferred tax asset

to the amount realizable for the PRC income tax purposes.

deferred tax asset benefit to reduce the total deferred tax asset to

the amount realizable for the PRC income tax purposes.

Management reviews this valuation allowance periodically and will make adjustments

as warranted.

A summary of the otherwise deductible (or taxable) deferred tax items is as follows:

A summary of the otherwise deductible (or taxable) deferred

tax items is as follows:

Deferred tax assets (liabilities)

13 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

During the three months ended March 31, 2025 and

During the three months ended June 30, 2025 and

2024, the effective income tax rate was estimated by the Company to be -2.5% and 122.9 %, respectively.

5 unchanged sentences

Effective income tax rate

As of March 31, 2025, except for the one-time

transition tax under the 2017 TCJA which imposes a U.S.

tax liability on all unrepatriated foreign E&Ps, the Company does not believe

that its future dividend policy and the available U.S.

tax deductions and net operating losses will cause the Company to recognize any

other substantial current U.S.

During the six months ended June 30, 2025 and

2024, the effective income tax rate was estimated by the Company to be - 0.9 % and - 13.5 %, respectively.

Six Months Ended

PRC Statutory rate

Effect of different tax jurisdiction

Effect of tax and book difference

Change in valuation allowance

Effective income tax rate

As of June 30, 2025, except for the one-time transition

tax under the 2017 TCJA which imposes a U.S.

tax liability on all unrepatriated foreign E&Ps, the Company does not believe that its

future dividend policy and the available U.S.

tax deductions and net operating losses will cause the Company to recognize any other substantial

federal or state corporate income tax liability in the near future.

Nor does it believe that the amount

of the repatriation of the VIE’s earnings and profits for purposes of paying dividends will change the Company’s position

that its PRC subsidiary Baoding Shengde and the VIE, Dongfang Paper are considered or are expected to be indefinitely reinvested offshore

to support our future capacity expansion.

Nor does it believe that the amount of the repatriation

of the VIE’s earnings and profits for purposes of paying dividends will change the Company’s position that its PRC subsidiary

Baoding Shengde and the VIE, Dongfang Paper are considered or are expected to be indefinitely reinvested offshore to support our future

capacity expansion.

If these earnings are repatriated to the U.S.

resulting in U.S.

taxable income in the future,

or if it is determined that such earnings are to be remitted in the foreseeable future, additional tax provisions would be required.

taxable income in the future, or if it is determined

that such earnings are to be remitted in the foreseeable future, additional tax provisions would be required.

The Company has adopted ASC Topic 740-10-05, Income

8 unchanged sentences

part, upon the results of operations for the given period.

As of March 31, 2025 and December 31, 2024, management considered that the

Company had no uncertain tax positions affecting its consolidated financial position and results of operations or cash flows, and will

continue to evaluate for any uncertain position in future.

As of June 30, 2025 and December 31, 2024, management considered that the Company

had no uncertain tax positions affecting its consolidated financial position and results of operations or cash flows, and will continue

to evaluate for any uncertain position in future.

There are no estimated interest costs and penalties provided in the Company’s

consolidated financial statements for the three months ended March 31, 2025 and 2024, respectively.

consolidated financial statements for the three and six months ended June 30, 2025 and 2024, respectively.

The Company’s tax positions

10 unchanged sentences

All shares of common stock under the 2023 ISP,

including shares originally authorized by equity holders and shares remaining for future issuance as of March 31, 2025, have been reserved.

including shares originally authorized by equity holders and shares remaining for future issuance as of June 30, 2025, have been reserved.

(17) Commitments and Contingencies

17 unchanged sentences

The lease was recorded in lease assets and liabilities in the consolidated balance sheet as

of March 31, 2025.

of June 30, 2025.

IT TECH PACKAGING, INC.

1 unchanged sentence

Capital commitment

As of March 31, 2025, the Company has entered

into several contracts for the purchase of paper machine of a new tissue paper production line PM10 and the improvement of Industrial

Total outstanding commitments under these contracts were $ 3,443,760 and $ 3,436,091 as of March 31, 2025 and December 31, 2024,

respectively.

As of June 30, 2025, the Company has entered into

several contracts for the purchase of paper machine of a new tissue paper production line PM10 and the improvement of Industrial Buildings.

Total outstanding commitments under these contracts were $ 3,453,189 and $ 3,436,091 as of June 30, 2025 and December 31, 2024, respectively.

The Company expected to pay off all the balances within 1 - 3 years.

1 unchanged sentence

The Company agreed with

Baoding Huanrun Trading Co., a major supplier of raw materials, to guarantee certain obligations of this third party, and as of March

Baoding Huanrun Trading Co., a major supplier of raw materials, to guarantee certain obligations of this third party, and as of June 30,

2025 and December 31, 2024, the Company guaranteed its long-term loan from financial institutions amounting to $ 4,330,456 (RMB 31,000,000 )

2 unchanged sentences

Pending legal proceeding of Jie Ping

In November 2023, an individual plaintiff involved in a civil loan

dispute filed a lawsuit against the defendants including Tengsheng Paper and Jie Ping, who served as the executive director and the legal

representative of Tengsheng Paper, at the Lianchi District People’s Court of Baoding City, China (the “PRC Court”).

In November 2023, an individual plaintiff involved

in a civil loan dispute filed a lawsuit against the defendants including Tengsheng Paper and Jie Ping, who served as the executive director

and the legal representative of Tengsheng Paper, at the Lianchi District People’s Court of Baoding City, China (the “PRC Court”).

From December 2023 through 2024, the plaintiff sought property preservation measures, requesting the PRC Court to freeze totaling RMB 6.70

5 unchanged sentences

for repayment.

Accrued litigation costs of $ 462,511 was recorded as current liabilities of consolidated balance sheet as of March 31,

Accrued litigation costs of $ 463,778 was recorded as current liabilities of consolidated balance sheet as of June 30, 2025.

(18) Segment Reporting

17 unchanged sentences

Three Months Ended

March 31, 2025

Not Attributable

June 30, 2025

Elimination of

Enterprise-wide,

Inter-segment

2 unchanged sentences

Interest expense

Income tax expense (benefit)

( 1,048,107 )

Income tax expense

Net income (loss)

( 2,218,151 )

1 unchanged sentence

Three Months Ended

March 31, 2024

June 30, 2024

Not Attributable

Elimination of

Enterprise-wide,

Inter-segment

3 unchanged sentences

Income tax expense

Net income (loss)

( 2,111,359 )

Six Months Ended

June 30, 2025

Elimination of

Inter-segment

Depreciation and amortization

Interest income

Interest expense

Income tax expense

( 4,414,021 )

( 5,455,611 )

As of March 31, 2025

Not Attributable

IT TECH PACKAGING, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Six Months Ended

June 30, 2024

Elimination of

Enterprise-wide,

Inter-segment

Depreciation and amortization

Interest income

Interest expense

Income tax expense

Net income (loss)

( 4,234,116 )

( 3,824,283 )

As of June 30, 2025

Elimination of

Inter-segment

As of December 31, 2024

Not Attributable

Elimination of

Enterprise-wide,

Inter-segment

2 unchanged sentences

(19) Concentration and Major Customers and Suppliers

For the three months ended March 31, 2025 and

For the three and months ended June 30, 2025 and

2024, the Company had no single customer contributed over 10% of total sales.

For the three months ended March 31, 2025, the

For the three months ended June 30, 2025, the

Company had two major suppliers accounted for 74 % and 17 % of total purchases.

For the three months ended March 31, 2024, the Company had

two major suppliers accounted for 75 % and 15 % of total purchases.

For the three months ended June 30, 2024, the Company had

three major suppliers accounted for 76 %, 16 % and 7 % of total purchases.

For the six months ended June 30, 2025, the Company had two major suppliers

accounted for 75 % and 17 % of total purchases.

For the six months ended June 30, 2024, the Company had three major suppliers accounted

for 76 %, 16 % and 7 % of total purchases.

(20) Concentration of Credit Risk

5 unchanged sentences

China in the event of bank failure, there is no deposit insurance system in China that is similar to the protection provided by the Federal

Deposit Insurance Corporation (“FDIC”) of the United States as of as of March 31, 2025 and December 31, 2024.

Deposit Insurance Corporation (“FDIC”) of the United States as of as of June 30, 2025 and December 31, 2024.

On May 1, 2015,

3 unchanged sentences

the United States, the Company’s U.S.

bank accounts are all fully covered by the FDIC insurance as of March 31, 2025 and December

bank accounts are all fully covered by the FDIC insurance as of June 30, 2025 and December

31, 2024, while for the cash placed in financial institutions in the PRC, the balances exceeding the maximum coverage of RMB 500,000 amounted

to RMB 34,751,252 ($ 4,841,221 ) as of March 31, 2025.

to RMB 51,146,683 ($ 7,144,789 ) as of June 30, 2025.

(21) Risks and Uncertainties

4 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 1. Financial Statements