TDH Holdings, Inc. Reports Full Year 2021 Audited Financial Results

ETC

QINGDAO, China, April 30, 2022 /PRNewswire/ — TDH Holdings, Inc. (NASDAQ: PETZ) (“TDH” or the “Company”), a PRC-based company that specializes in the development, manufacturing and sales of pet food products in China and beyond, announced today its financial results for the twelve months ended December 31, 2021.

Full Year 2021 Financial Highlights:

 For the Twelve Months Ended December 31, 

 ($ millions, except per share data) 

2021

2020

 % Change 

 Revenues 

$1.09

$0.82

33.94%

 Gross loss 

($0.02)

($0.04)

50.82%

 Gross loss margin 

-1.88%

-5.13%

3.19 pp*

 Loss from operations

($4.61)

($1.93)

121.11%

 Operating loss margin 

-422.58%

-236.25%

-153.76 pp*

 Net loss attributable to
common stockholders 

($6.12)

($0.87)

-498.21%

 Loss per share – basic and
diluted 

($0.10)

($0.02)

-150.00%

 * pp: percentage points 

 

  • Revenues increased by 33.94% from $0.82 million in fiscal year 2020 to $1.09 million in fiscal year 2021, our sales of pet food decreased from approximately $0.82 million in fiscal year 2020 to approximately $0.49 million in fiscal year 2021, or by approximately 40.5%, which was offset by an increase in revenue from our newly acquired restaurant business in Kansas by approximately $0.61 million. The decrease of pet food revenue in 2021 was mainly due to: (1) the continuous development of COVID-19, we had to close a factory and stop production for a period of time again in 2021, which caused the delay of orders and some customers canceled their orders, decreasing our pet food sales revenue and sales volume; (2) the cost of raw materials required for pet food production has risen to a certain extent due to the COVID-19 pandemic and general inflation, which led to our reduced production and sales of pet food products during 2021; and (3) we declined taking orders that were historically unprofitable. As a result, our pet food sales volume significantly decreased in 2021 as compared to 2020. On the other side, on October 31, 2021, we acquired a 51% equity interests of Far Ling’s Inc. and 100% equity interests of Bo Ling’s Chinese Restaurant, Inc. This resulted in an increase of $0.6 million in revenue from our restaurant business operations segment.
  • Gross loss was $0.02 million in fiscal year 2021 as compared to gross loss of $0.04 million in fiscal year 2020. The decrease in gross loss was a result of declining to take historically unprofitable orders, and new profits generated from our restaurant business operations segment.
  • Operating loss was $4.61 million in fiscal year 2021 as compared to an operating loss of $1.93 million in fiscal year 2020. The continuous deficit from operations was mainly due to the fact that our pet food sales revenue continued to decrease, while we continued to incur fixed overhead costs and high operating expenses during fiscal year 2021.
  • Net loss attributable to common stockholders was $6.12 million, or a loss per share of $0.10, for the fiscal year 2021 as compared to net loss of $0.87 million, or a loss per share of $0.02, for fiscal year 2020.

Full Year 2021 Financial Results

Revenues

The Company’s revenue sources include pet food sales and restaurant business operations.  Pet food sales mainly include sales for pet chews, dried pet snacks and wet canned pet foods in overseas markets, domestic markets and by e-commerce. We started to generate revenue from restaurant business operations in the last quarter of fiscal year 2021. Total revenues increased by 33.94% from $0.82 million in fiscal year 2020 to $1.09 million in fiscal year 2021, our sales of pet food have decreased from approximately $0.82 million in fiscal year 2020 to $0.49 million in fiscal year 2021, or by approximately 40.5%, offset by an increase in revenue from our newly acquired restaurant business by approximately $0.61 million. The decrease of pet food revenue in fiscal year 2021 was mainly due to: (1) the continuous development of COVID-19, as we had to close a factory and stop production again for a period of time in 2021, which caused the delay of orders and some customers canceled their orders, decreasing our pet food sales revenue and sales volume; (2) the cost of raw materials required for pet food production has risen to a certain extent due to the COVID-19 pandemic and general inflation, which led to our reduced production and sales of pet food products during fiscal year 2021; and (3) we declined taking orders that were historically unprofitable.  As a result, our pet food sales volume significantly decreased in 2021 as compared to 2020. On the other side, on October 31, 2021, we acquired 51% equity interests of Far Ling’s Inc. and 100% equity interests of Bo Ling’s Chinese Restaurant, Inc., located in Kansas. This resulted in an increase of $0.6 million in food service revenue from our restaurant business operations segment.

 For the Twelve Months Ended December 31, 

2021

2020

 Y/Y Change 

Revenues
($’000)

% of
Total

Revenues
($’000)

% of
Total

Amount
($’000)

%

 Overseas 

$

135

12.35%

$

226

27.77%

$

(91)

-40.41%

 Domestic 

319

29.22%

575

70.52%

(256)

-44.50%

 E-commerce 

35

3.17%

17

2.05%

18

107.03%

Restaurant 
revenue

606

55.54%

606

100.00%

 less: sales
tax and
additional
surcharge 

(3)

-0.29%

(3)

-0.34%

11.90%

 Total 

$

1,092

100.0%

$

815

100.0%

$

277

-33.94%

Overseas sales decreased by $0.09 million, or 40.41%, to $0.14 million for the fiscal year 2021 from $0.23 million for fiscal year 2020. Domestic sales decreased by $0.25 million, or 44.50%, to $0.32 million for the fiscal year 2021 from $0.57 million for fiscal year 2020. The decrease of pet food revenue in fiscal year 2021 was mainly due to (1) the continuous development of COVID-19, as we had to close a factory and stop production again for a period of time in 2021, which caused the delay of orders and some customers canceled their orders, decreasing our pet food sales revenue and sales volume; (2) the cost of raw materials required for pet food production has risen to a certain extent due to the COVID-19 pandemic and general inflation, which led to our reduced production and sales of pet food products during 2021; and (3) we declined taking orders that were historically unprofitable. Sales from the e-commerce channel increased by $0.01 million, or 107.03%, to $0.03 million for the year of 2021 from $0.02 million for 2020, due to the increased promotion of our products through e-commerce channels. In addition, on October 31, 2021, we acquired 51% equity interests of Far Ling’s Inc. and 100% equity interests of Bo Ling’s Chinese Restaurant, Inc. This resulted in an increase of $0.61 million in restaurant business operations revenue.

 For the Twelve Months Ended December 31, 

2021

2020

 Y/Y Change 

Revenues
($’000)

% of
Total

Revenues
($’000)

% of
Total

Amount
($’000)

%

 Pet chews 

$

46

4.22%

$

59

7.25%

$

(13)

-21.97%

 Dried pet
snacks 

293

26.86%

318

38.94%

(24)

-7.58%

 Wet canned pet
food 

11

0.99%

84

10.32%

(73)

-87.21%

 Dental health
snacks 

6

0.56%

20

2.44%

(14)

-69.23%

 Baked pet
biscuits 

3

0.38%

(3)

-100.00%

Restaurant
revenue

606

55.54%

606

100.00%

 Others 

132

12.11%

334

41.01%

(202)

-60.46%

 Less: sales tax
and additional
surcharge 

(3)

-0.29%

(3)

-0.34%

11.90%

 Total 

$

1,092

100.00%

$

815

100.00%

$

(277)

33.94%

Sales of pet chews decreased by $0.01 million, or 21.97%, to $0.05 million for fiscal year 2021 from $0.06 million for fiscal year 2020. Sales of dried pet snacks decreased by $0.03 million, or 7.58%, to $0.29 million for fiscal year 2021 from $0.32 million for fiscal year 2020. Sales of wet canned pet food decreased by $0.07 million, or 87.21%, to $0.01 million for fiscal year 2021 from $0.08 million for fiscal year 2020. Sales of dental health snacks decreased by $0.01 million, or 69.23%, to $0.01 million for fiscal year 2021 from $0.02 million for fiscal year 2020. The decrease of pet food revenue in fiscal year 2021 was mainly due to:

(1) the continuous development of COVID-19, we had to close a factory and stop production again for a period of time in 2021, which caused the delay of orders and some customers canceled their orders, decreasing our pet food sales revenue and sales volume; (2) the cost of raw materials required for pet food production has risen to a certain extent due to the COVID-19 pandemic and general inflation, which led to our reduced production and sales of pet food products during 2021; and (3) we declined taking orders that were historically unprofitable. Sales from the e-commerce channel increased by $0.01 million, or 107.03%, to $0.03 million for the fiscal year of 2021 from $0.02 million for fiscal year 2020, due to the increased promotion of our products through e-commerce channels.  In addition, on October 31, 2021, we acquired 51% equity interests of Far Ling’s Inc. and 100% equity interests of Bo Ling’s Chinese Restaurant, Inc. This resulted in an increase of $0.61 million in restaurant business operations revenue.

Cost of revenues

Cost of revenues of our pet food business consists primarily of direct raw materials, direct payroll of workshop staff, utility and supply costs consumed in the manufacturing process, manufacturing labor, depreciation expense and overhead expenses necessary to manufacture finished goods as well as distribution costs such as inbound freight charges. Cost of revenues of our restaurant business consist primarily of food and packaging costs, payroll and employee benefit costs, store lease and occupancy costs and depreciation and amortization costs. Cost of revenues increased by $0.25 million, or 29.80%, to $1.11 million for fiscal year 2021 from $0.86 million for fiscal year 2020. The increase in our costs was in line with the increased revenue in fiscal year 2021.

Gross loss and gross loss margin

Gross loss was $0.02 million for fiscal year 2021, compared to gross loss of $0.04 million for fiscal year 2020. Gross loss margin was 1.88% for fiscal year 2021, compared to gross loss margin of 5.13% for fiscal year 2020.

Operating expense

Operating expense consists of selling expenses and general and administrative expenses.

Selling expenses consist primarily of advertising, salaries and shipping and handling costs incurred during the selling activities. Advertising and transportation expenses are charged to expenses as incurred. Selling expenses decreased by $0.08 million, or 35.64%, to $0.08 million for fiscal year 2021 from $0.12 million for fiscal year 2020.

General and administrative expenses increased by $2.18 million, or 123.36%, to $3.94 million for fiscal year 2021 from $1.77 million for fiscal year 2020. The main reason for the increase was due to the company’s payment of certain legal costs, an increase in consulting service fees and increased depreciation and amortization expenses related to our restaurant business segment.

In connection with our acquisition of restaurant business, we recognized a goodwill of $355,570 as of the acquisition date. However, due to our significant net loss in fiscal year 2021, goodwill of $355,570 has been fully impaired for the year ended December 31, 2021.

Impairment of long-lived assets other than goodwill charge was $0.22 million in fiscal year 2021, as compared to $0 in fiscal year 2020.

As a result, total operating expenses increased by $2.71 million, or 143.80%, to $4.59 million for fiscal year 2021 from $1.88 million for fiscal year 2020. As a percentage of total revenues, total operating expenses was 420.69% for the fiscal year 2021, compared to 231.11% for fiscal year 2020.

Operating loss and operating loss margin

Loss from operations was $4.61 million for fiscal year 2021, compared to operating loss of $1.93 million for fiscal year 2020. The continuous loss from operations was mainly due to increased operating expenses in fiscal year 2021.

Net loss and loss per share

Net loss was $6.72 million for fiscal year 2021, compared to net loss of $0.87 million for fiscal year 2020. Net loss attributable to common stockholders was $6.12 million, or loss per share of $0.10, for the fiscal year 2021. This is compared to net loss attributable to common stockholders of $0.87 million, or loss per share of $0.02 for fiscal year 2020.

Financial Conditions

As of December 31, 2021, the Company had cash, cash equivalents and restricted cash of $19.51 million, compared to $6.75 million as of December 31, 2020. Accounts receivable and inventories were $0.04 million and $0.05 million, respectively, as of December 31, 2021, compared to $0.17 million and $0.25 million, respectively, as of December 31, 2020. As of December 31, 2021, we had working capital of approximately $11.42 million, as compared to working capital deficit of $8.55 million as of December 31, 2020.

Net cash used in operating activities was $3.45 million for the fiscal year 2021, compared to $2.63 million for fiscal year 2020. Net cash used in investing activities was $1.64 million for fiscal year 2021, compared to $3.35 million net cash provided by investing activities in fiscal year 2020. Net cash provided by financing activities was $18.10 million for the fiscal year 2021, compared to $0.59 million net cash used in financing activities in fiscal year 2020.

Going Concern

As reflected in our consolidated financial statements, for the year ended December 31, 2021, we have incurred a net loss of approximately $6.12 million and our cash used in operating activities amounted to approximately $3.45 million. Our business operations may be further affected by the ongoing COVID-19 pandemic. Although we received approximately $20.2 million net proceeds from issuance of common shares and warrants to certain investors during fiscal year 2021, there can be no assurances that future revenue or capital infusion will be sufficient to enable us to develop our business to a level where it will be profitable or to generate positive cash flows. These factors raise substantial doubt about the Company’s ability to continue as a going concern for the next twelve months from the date that our consolidated financial statements are issued.

As of December 31, 2021, we had cash and cash equivalents and restricted cash of approximately $19.51 million. We also had short-term investments of approximately $4.43 million, which are highly liquid and can be converted into cash and used in our operations if needed. We also had approximately an aggregate of $5.99 million of loans (including approximately $5.44 million short-term loans and approximately $0.55 million short-term loans from related parties). For legal proceedings since December 31, 2019 regarding our delayed repayment of certain bank loans upon maturity, in March and April 2020, we received court rulings requiring us to make an aggregate RMB 54.54 million (approximately $8.35 million) of payments to the financial institutions. On March 13, 2021, the land and factory buildings on the land owned by our subsidiary, were auctioned by the court for $5,098,461 (RMB 33.14 million), among which, $3,192,827 (RMB 21.14 million) has been used to repay loan principal and accrued interest to a financial institution based on the court order. The repayment has been completed as of the date of this press release.  On March 16, 2022, the People’s Court of Huangdao District, Qingdao City, Shandong Province made a civil ruling and announced the acceptance of creditors’ application of bankruptcy liquidation of our subsidiary, Qingdao Tiandihui Foodstuffs Co., Ltd., and it entered into bankruptcy proceedings. Accordingly, these legal claims relating to the bank loans are now subject to the bankruptcy proceedings.

Based on our current financial conditions, our cash balance and revenues generated from our business operations may not be currently sufficient and cannot be projected to cover our future operating expenses and meet our obligations as they become due for the next twelve months after the date that our financial statements are issued.

We face substantial challenges in our effort to resume normal business activities. Our future growth will place a significant strain on our sales and marketing capacities, administrative and operating infrastructure, manufacturing facilities and other resources. To effectively manage additional challenges brought on by COVID-19, we need to evaluate and identify suitable strategic or acquisition opportunities, complete such transactions on commercially favorable terms, or successfully integrate business operations, infrastructure and management philosophies of acquired businesses and companies, resolve the substantial litigation and judgements to which we are subject and raise substantial capital. There may be particular complexities, regulatory or otherwise, associated with our expansion into new markets, and our strategies may not succeed beyond our current markets. If we are unable to effectively address these challenges, our ability to execute acquisitions as a component of our long-term strategy will be impaired, which could have an adverse effect on our growth or our ability to function as a going concern. We also need to expand our customer base, refine our operational, financial and management controls and reporting systems and procedures. If we fail to efficiently manage this expansion of our business, our costs and expenses may increase more than anticipated and we may not successfully attract a sufficient number of customers in a cost-effective manner, respond to competitive challenges, or otherwise execute our business plans. In addition, we may, as part of carrying out our growth strategies, adopt new initiatives to implement new pricing models and strategies. We cannot assure you that these initiatives may achieve the anticipated results.

Notice

Rounding amounts and percentages: Certain amounts and percentages included in this press release have been rounded for ease of presentation. Percentage figures included in this press release have not in all cases been calculated on the basis of such rounded figures, but on the basis of such amounts prior to rounding. For this reason, certain percentage amounts in this press release may vary from those obtained by performing the same calculations using the figures in the financial statements. In addition, certain other amounts that appear in this press release may not sum due to rounding.

About TDH Holdings, Inc.

Founded in April 2002, TDH Holdings, Inc. (the “Company”) (NASDAQ: PETZ), is a developer, manufacturer and distributer of a variety of pet food products under multiple brands that are sold in the China, Asia and Europe. The Company also started the restaurant business operation since late 2021. More information about the Company can be found at www.tiandihui.com.

Forward-Looking Statements

This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as “may,” “will,” “intend,” “should,” “believe,” “expect,” “anticipate,” “project,” “estimate” or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Specifically, the Company’s statements regarding, among others: its growth and business outlook; its ability to execute on its business plan, secure necessary capital to sustain and maintain its operation; its ability to resume its operations at the previous level; its ability to successfully resolve various legal proceedings and judgments in which it is involved or have been obtained against it; its ability to expand its market and customer base; its ability to refine its operational, financial and management controls and reporting systems and procedures, are forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the following:  the Company’s goals and strategies; the ability to identify, execute and integrate strategic or acquisition opportunities, the Company’s future business development; product and service demand and acceptance; changes in technology; economic conditions; the growth of the petfood industry in China and internationally; reputation and brand; the impact of competition and pricing; government regulations; fluctuations in general economic and business conditions in China and internationally and assumptions underlying or related to any of the foregoing and other risks contained in reports filed by the Company with the Securities and Exchange Commission.  For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company’s filings with the U.S. Securities and Exchange Commission, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

TDH HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

December 31,

December 31,

2021

2020

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$

18,027,322

$

6,566,549

Restricted cash

1,483,653

182,515

Short-term investments

4,428,446

3,138,578

Accounts receivable, net

39,512

168,499

Advances to suppliers, net

10,986

41,088

Inventories, net

51,423

247,245

Prepayments and other current assets, net

1,205,695

172,481

Total current assets

25,247,037

10,516,955

NON-CURRENT ASSETS

Property, plant and equipment, net

1,543,430

6,636,995

Land use rights, net

653,125

1,009,005

Operating lease right-of-use assets

4,604,365

19,103

Operating lease right-of-use assets – related parties

270,852

Total non-current assets

6,800,920

7,935,955

Total assets

$

32,047,957

$

18,452,910

LIABILITIES AND STOCKHOLDERS’
EQUITY (DEFICIT)

CURRENT LIABILITIES:

Accounts payable

$

3,065,387

$

3,209,763

Accounts payable – related parties

127,688

124,715

Advances from customers

109,959

90,834

Bank overdrafts

79,851

78,320

Short-term loans

5,440,350

8,391,323

Short-term loans – related parties

555,096

985,883

Taxes payable

82,614

60,729

Due to related parties

307,509

42,021

Operating lease liabilities, current

268,403

9,913

Operating lease liabilities – related parties, current

195,231

Other current liabilities

3,793,140

5,882,164

Total current liabilities

13,829,998

19,070,896

NON-CURRENT LIABILITIES:

Deferred tax liabilities

1,132

Operating lease liabilities – related party, non-current

4,846,760

274,794

Total liabilities

18,677,890

19,345,690

STOCKHOLDERS’ EQUITY (DEFICIT):

Common stock ($0.001 par value; 200,000,000
shares authorized; 104,373,621 and 45,849,995
shares issued and outstanding at December 31, 2021
and 2020, respectively)

104,374

45,850

Additional paid-in capital

42,151,658

21,963,570

Statutory reserves

160,014

160,014

Accumulated deficit

-28,969,627

-22,849,319

Accumulated other comprehensive loss

-460,702

-212,895

Total TDH Holdings, Inc. stockholders’ equity
(deficit)

12,985,717

-892,780

Non-controlling interest

384,350

Total stockholders’ equity (deficit)

13,370,067

892,780

Total liabilities and stockholders’ equity (deficit)

$

32,047,957

$

18,452,910

TDH HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

For The Years Ended December 31,

2021

2020

2019

Net revenue

$

1,091,889

$

815,225

$

12,455,414

Net revenue – related parties

192,841

Total revenue

1,091,889

815,225

12,648,255

Cost of revenue

1,112,463

857,060

13,992,499

Cost of revenue – related parties

178,636

Total cost of revenue

1,112,463

857,060

14,171,135

Gross loss

-20,574

-41,835

-1,522,880

Operating expenses:

Selling expense

75,944

117,993

920,237

General and administrative expense

3,944,709

1,766,109

3,702,035

Impairment of long-lived assets other
than goodwill

217,257

813,344

Impairment of goodwill

355,570

Total operating expenses

4,593,480

1,884,102

5,435,616

Loss from operations

-4,614,054

-1,925,937

-6,958,496

Interest expense

-957,548

-1,180,489

-1,378,755

Government subsidies

8,651

129,255

Other income

215,858

137,163

1,189

Other expense

-1,636,080

-35,197

-290,655

Investment income, net

275,866

2,120,241

Loss from equity method investment

-127,965

Total other income (expenses)

-2,101,904

1,050,369

-1,666,931

Loss before income tax benefit

-6,715,958

-875,568

-8,625,427

Income tax benefit

-900

Net loss

-6,715,958

-874,668

-8,625,427

Less: Net loss attributable to non-controlling
interest

-595,650

-8

Net loss attributable to TDH Holdings,
Inc.

$

-6,120,308

$

-874,668

$

-8,625,419

Comprehensive loss

Net loss

$

-6,120,308

$

-874,668

$

-8,625,427

Other comprehensive loss

Foreign currency translation adjustment

-247,807

-355,411

-100,954

Total comprehensive loss

-6,368,115

-1,230,079

-8,726,381

Less: Comprehensive loss attributable to
noncontrolling interest

-8

Comprehensive loss attributable to TDH
Holdings, Inc.

$

-6,368,115

$

-1,230,079

$

-8,726,373

Loss per common share attributable to
TDH Holdings, Inc.

Basic

$

-0.10

$

-0.02

$

-0.41

Diluted

$

-0.10

$

-0.02

$

-0.41

Weighted average common shares
outstanding

Basic

59,185,891

45,849,995

21,022,598

Diluted

59,185,891

45,849,995

21,022,598

TDH HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

For The Years Ended December 31,

2021

2020

2019

Cash flows from operating activities

Net loss

$

-6,120,308

$

-874,668

$

-8,625,427

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization expense

408,740

391,351

571,528

Fair value change of short-term investments

-495,265

-2,120,241

Loss from equity method investment

0

127,965

Loss on disposal of subsidiaries

0

5,018

Impairment of goodwill

355,570

Impairment of long-lived assets other than goodwill

217,257

813,344

Inventory write-down

191,026

42,241

518,119

Allowance for credit losses

2,168

74,190

659,569

Deferred income taxes

0

-1,106

-3,861

Loss (gain) on disposal of property, plant and equipment

955,428

-16,870

308,003

Amortization of operating lease right-of-use assets

280,610

Non-cash lease expense

-4,595,020

33,944

89,176

Gain on forgiveness of short-term loan

$

0

$

-6,265

$

Changes in operating assets and liabilities:

0

Accounts receivable, net

128,987

-112,177

329,042

Accounts receivable – related parties, net

0

306,301

Inventories, net

4,796

201,730

2,009,862

Operating lease liabilities

4,830,456

-9,382

Operating lease liabilities – related parties

-195,231

16,262

16,404

Due from related parties, net

0

-2,206

Due to related parties

393,176

14,387

Advances to suppliers, net

30,102

-12,179

36,322

Prepayments and other current assets, net

1,006,351

-29,363

516,018

Accounts payable

-144,376

-416,506

-2,775,356

Accounts payable – related parties

123,184

-6,703

Interest payable

0

1,065,277

260,417

Interest payable – related parties

0

43,835

Notes payable

0

-1,046,257

Taxes payable

21,855

13,797

Advances from customers

0

-31,366

-42,923

Advances from customer – related party

19,125

Deferred income tax liability

1,132

Other current liabilities

861,109

-866,962

280,843

Net cash used in operating activities

$

-3,445,819

$

-2,628,255

$

-5,626,618

Cash flows from investing activities

Payments to acquire property, plant and equipment

-47,086

-121,560

Proceeds from disposal of property, plant and equipment

233,747

Disposal of subsidiaries

83

Repayments from related parties

1,282

Cash obtained from business acquisition

171,827

Payment for business acquisition

-1,020,000

Purchase of short-term investments

-4,372,809

-38,743,908

Proceeds from sale of short-term investments

3,578,206

42,146,183

Net cash (used in) provided by investing activities

-1,642,776

3,355,189

113,552

Cash flows from financing activities

Proceeds from issuance of common shares

20,222,188

6,760,000

Purchase of noncontrolling interest

-100

(100

Repayments to related parties

-1,000

Proceeds from bank overdrafts

78,162

Proceeds from short-term loans

107,829

1,046,275

Repayments of short-term loans

-1,692,988

-746,437

-2,073,177

Proceeds from short-term loans – related parties

49,350

4,791,403

Repayments of short-term loans – related parties

-430,787

-1,080,947

Net cash provided by (used in) financing activities

$

18,098,313

$

-589,358

$

9,520,716

Effect of exchange rate changes on cash, cash equivalents and restricted
cash

-247,807

106,910

-203,577

Net change in cash, cash equivalents and restricted cash

12,761,911

244,486

3,804,073

Cash, cash equivalents and restricted cash, beginning of the year

6,749,064

6,504,578

2,700,505

Cash, cash equivalents and restricted cash, end of the year

$

19,510,975

$

6,749,064

$

6,504,578

Supplemental cash flow information

Interest paid

$

$

38,362

$

1,118,338

Income taxes paid

$

$

146

$

Non-cash investing and financing activities

Accrued interest added to short-term loan – related party

$

$

$

126,697

Liabilities assumed in connection with purchase of property, plant and
equipment

$

$

14,592

$

51,196

Notes payable reclassified to short-term loans

$

$

908,850

$

479,724

Receivables from related parties settled with payables to related parties

$

$

$

28,694

Receivables from common stock subscription settled with loan payables
to a related party

$

$

$

4,240,000

Short-term loans settled by transferring an equity investment to the
creditor

$

$

70,708

$

Cashless exercise of warrants

$

24,424

$

$

Right of use assets obtained in exchange for operating lease obligations

$

5,158,944

$

$

Reconciliation of cash, cash equivalents, and restricted cash to the
consolidated balance sheets

Cash and cash equivalents

$

18,027,322

$

6,566,549

$

5,114,175

Restricted cash

$

1,483,653

$

182,515

$

1,390,403

Total cash, cash equivalents, and restricted cash

$

19,510,975

$

6,749,064

$

6,504,578

TDH HOLDINGS, INC. AND SUBSIDIARIES

 CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

 Number of
Shares

 Common
Shares

 Additional
Paid-in
Capital

 Stock
Subscription
Receivable

 Statutory
Reserves

 Retained
Earnings
(Deficit)

 Accumulated
Other
Comprehensive Income
(Loss)

 Noncontrolling
Interest

 Total
Stockholders’
Equity
(Deficit)

Balance, December 31, 2017

9,423,750

$

9,424

$

9,947,084

$

-100,000

$

160,014

$

869,993

$

308,286

$

$

11,194,801

 Net loss

-14,219,225

-40

-14,219,265

 Issuance of common shares for business acquisition

1,092,912

1,093

1,051,927

1,053,020

 Collection of stock subscription receivable

100,000

100,000

 Liabilities assumed in connection with acquisition of a
subsidiary

 Statutory Reserve

 Foreign currency translation adjustment

-64,816

-307

-65,123

Balance, December 31, 2018

10,516,662

$

10,517

$

10,999,011

$

$

160,014

$

-13,349,232

$

243,470

$

-347

$

-1,936,567

Net Loss

-8,625,419

-8

-8,625,427

Issuance of common stock

35,333,333

35,333

10,964,667

11,000,000

Disposal of noncontrolling interest

347

347

Foreign currency translation adjustment

-100,954

-100,954

Balance, December 31, 2019

45,849,995

$

45,850

$

21,963,678

$

$

160,014

$

-21,974,651

$

142,516

$

-8

$

337,399

Net Loss

-874,668

-874,668

Foreign currency translation adjustment

-355,411

-355,411

Purchase of noncontrolling interest

-108

8

-100

Balance, December 31, 2020

45,849,995

$

45,850

$

21,963,570

$

$

160,014

$

-22,849,319

$

-212,895

$

$

-892,780

Net Loss

-6,120,308

-595,650

-6,715,958

Issuance of common stock

34,100,000

34,100

20,188,088

20,222,188

Warrants exercised for cashless

24,423,626

24,424

24,424

Foreign currency translation adjustment

-247,807

-247,807

Acquisition of restaurant business

980,000

980,000

Balance, December 31, 2021

104,373,621

$

104,374

$

42,151,658

$

$

160,014

$

-28,969,627

$

-460,702

$

384,350

$

13,370,067

Cision View original content:https://www.prnewswire.com/news-releases/tdh-holdings-inc-reports-full-year-2021-audited-financial-results-301536587.html

Source: TDH Holdings, Inc.

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