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Lakeside Announces Fiscal 2025 Third Quarter and Nine-Month Results

1. LSH's Q3 revenue declined from $4.46M to $3.80M, mainly in freight solutions. 2. New pharmaceutical distribution segment contributed $715,362 to revenue this quarter. 3. Operating expenses for Q3 increased significantly, leading to a $1.10M loss. 4. The company emphasizes expanding in China's pharmaceutical market despite freight challenges. 5. LSH raised $6.75M through an IPO to support growth strategies.

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FAQ

Why Bearish?

Recent revenue declines, increased operating losses, and a shift in market focus typically indicate financial stress, similar to other logistics firms that faced challenges during economic downturns.

How important is it?

The article highlights immediate financial results which indicate LSH's vulnerability but also its strategic shift towards pharmaceuticals.

Why Short Term?

Immediate impacts are more likely due to declining revenues and operational losses. Recovery might take longer but recent growth in pharmaceuticals provides a potential offset.

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ITASCA, IL, May 15, 2025 (GLOBE NEWSWIRE) -- Lakeside Holding Limited (“Lakeside” or the “Company”) (Nasdaq: LSH), a U.S.-based cross-border supply chain solution provider with a unique focus on the Asia-Pacific market operating through two specialized subsidiaries—American Bear Logistics and Hupan Pharmaceutical (Hubei) Co., Ltd., today announced financial results for its fiscal 2025 third quarter and nine months ended March 31, 2025. Management Commentary "The third quarter and first nine months of fiscal 2025 presented a dynamic environment for Lakeside," commented Henry Liu, Chief Executive Officer. "While our established cross-border freight solutions experienced revenue declines compared to the prior year, primarily due to shifts in global shipping demands and pricing pressures, we are encouraged by the initial contributions from our new pharmaceutical distribution segment following the Hupan Pharmaceutical acquisition. Our strategic objectives remain clear: expand our footprint in China's pharmaceutical distribution market, where significant growth opportunities exist, while continuing to optimize our cross-border logistics services. We are actively integrating Hupan Pharmaceutical into our operations to leverage synergies between business segments. Despite challenging market conditions in the freight sector, we remain committed to diversifying revenue streams and investing in high-growth areas. We believe our strategic focus on the Asia-Pacific market, coupled with our expansion into the pharmaceutical sector, positions Lakeside for long-term shareholder value creation." Highlights for the Nine Months Ended March 31, 2025, and Recent Developments: Successful Initial Public Offering (IPO): On July 1, 2024, the Company successfully closed its IPO of 1,500,000 shares of common stock at $4.50 per share, raising aggregate gross proceeds of approximately $6.75 million (net proceeds of approximately $5.4 million after deducting underwriting discounts, commissions, and other offering expenses). This milestone provided significant capital to support the Company’s growth strategies and operational expansion.Acquisition of Hupan Pharmaceutical: On November 21, 2024, Lakeside completed the acquisition of Hupan Pharmaceutical (Hubei) Co., Ltd. (“Hupan Pharmaceutical”), marking its entry into the medical logistics and pharmaceutical distribution sector in China. This strategic acquisition is aimed at diversifying revenue streams and capitalizing on the growing healthcare market in the region. Hupan Pharmaceutical contributed $715,362 to revenues for the nine months ended March 31, 2025.Convertible Debt Financing: On March 5, 2025, Lakeside announced a convertible debt financing agreement for up to $4.5 million. This financing is intended to provide additional working capital to support the growth of its pharmaceutical distribution business and for general corporate purposes, further strengthening the Company’s financial position and ability to execute its strategic initiatives.Expansion of Pharmaceutical Business: Following the acquisition, the Company has been actively working to integrate Hupan Pharmaceutical and explore new business opportunities within the Chinese pharmaceutical market. This includes efforts to secure new distribution agreements and expand its product portfolio. For instance, as noted in prior announcements, the company has been working on securing distribution agreements with major pharmaceutical producers like Kelun Pharmaceutical.Continued Focus on Cross-Border Logistics: While navigating a challenging global shipping environment, American Bear Logistics, the Company’s freight forwarding arm, continued to provide customized cross-border ocean and airfreight solutions. The company remains focused on serving its core Asia-Pacific to U.S. trade lane, adapting to market shifts and customer needs. Financial Results for the Three Months Ending March 31, 2025: Total revenues for the third quarter of fiscal 2025 were $3.80 million, a decrease compared to $4.46 million in the corresponding quarter of the previous fiscal year. This revenue comprised $2.86 million from third-party cross-border freight solutions (down from $3.82 million year-over-year), $0.45 million from related-party cross-border freight solutions (down from $0.64 million), and $0.50 million from the distribution of pharmaceutical products by third parties, a new revenue stream compared to nil in the prior year’s third quarter. The total cost of revenues for the third quarter was $3.09 million, reduced from $3.49 million in the third quarter of fiscal 2024. This resulted in a gross profit of $0.72 million for the third quarter of fiscal 2025, compared to a gross profit of $0.98 million in the same period last year. Operating expenses for the third quarter totaled $1.79 million, an increase from $0.94 million in the prior year’s third quarter. This included selling expenses of $0.10 million (nil in Q3 FY2024) and general and administrative expenses of $1.68 million (up from $0.96 million in Q3 FY2024). Consequently, the company recorded a loss from operations of $1.10 million for the third quarter of fiscal 2025, a shift from an income from operations of $0.04 million in the third quarter of fiscal 2024. After accounting for other income and income taxes, the net loss attributable to the Company for the third quarter of fiscal 2025 was $1.07 million, or a loss of $0.14 per basic and diluted share. This compares to a net income attributable to the Company of $0.01 million, or $0.00 per share, for the third quarter of fiscal 2024. Financial Results for the Nine Months Ended March 31, 2025: For the nine months ended March 31, 2025, total revenues were $11.48 million, compared to $13.53 million for the same period in fiscal 2024. Revenues from third-party cross-border freight solutions were $9.56 million (down from $12.46 million), related-party cross-border freight solutions contributed $1.21 million (up from $1.07 million), and the distribution of pharmaceutical products by third parties generated $0.72 million (compared to nil in the prior year period). The total cost of revenues for the nine-month period was $10.28 million, a decrease from $10.84 million in the prior year period. This led to a gross profit of $1.20 million for the first nine months of fiscal 2025, down from $2.69 million in the corresponding period of fiscal 2024. Operating expenses for the nine months increased to $5.60 million from $2.90 million in the prior year period. These expenses included $0.16 million in selling expenses (nil in the prior year period) and $5.43 million in general and administrative expenses (up from $2.80 million). As a result, the loss from operations for the nine months ended March 31, 2025, was $4.40 million, compared to a loss from operations of $0.21 million for the same period in fiscal 2024. The net loss attributable to the Company for the nine months ended March 31, 2025, was $4.35 million, or a loss of $0.58 per basic and diluted share. This compares to a net loss attributable to the Company of $0.23 million, or a loss of $0.04 per share, for the nine months ended March 31, 2024. Revenues by Customer Geographic Location For the three months ended March 31, 2025, revenues from Asia-based customers were $3.3 million, a decrease from $3.8 million in the same period of the prior year. Revenues from U.S.-based customers were $0.5 million for the third quarter of fiscal 2025, compared to $0.6 million in the third quarter of fiscal 2024. The shift in revenue composition reflects the dynamic nature of global trade and the company’s strategic focus. The following table presents the disaggregation of revenues by customer geographic location for the three months ended March 31, 2025 and 2024: Revenues by Customer Geographic Location (Unaudited)   For the three months ended March 31,         2025  2024       Revenues Amount  % of total Revenues  Amount  % of total Revenues  Amount Increase (Decrease)  Percentage Increase (Decrease) Revenue from cross-border freight solutions                  Asia-based customers $2,851,137   75.0%  3,822,169   85.7% $(971,032)  (25.4)%U.S.-based customers  454,727   12.0%  638,594   14.3%  (183,867)  (28.8)%   3,305,864   87.0%  4,460,763   100.0%  (1,154,899)  (25.9)%Revenue from distribution of pharmaceuticals                        Asia-based customers  497,276   13.0%  -   -   497,276   N/A Total revenues $3,803,140   100.0% $4,460,763   100.0% $(657,623)  (14.7)%                          For the nine months ended March 31, 2025, revenues from Asia-based customers totaled $9.1 million, an increase from $8.1 million in the corresponding period of fiscal 2024. This growth highlights the continued demand from our Asia-based clientele. Revenues from U.S.-based customers for the nine-month period were $2.4 million, compared to $5.4 million in the prior year period, reflecting strategic adjustments in customer focus and market conditions. The following table presents the disaggregation of revenues by customer geographic location for the nine months ended March 31, 2025 and 2024:   For the nine months ended March 31,         2025  2024       Revenues Amount  % of total Revenues  Amount  % of total Revenues  Amount Increase (Decrease)  Percentage Increase (Decrease) Revenue from cross-border freight solutions                  Asia-based customers $8,410,974   73.3% $8,119,136   60.0% $291,838   3.6%U.S.-based customers  2,353,947   20.5%  5,406,206   40.0%  (3,052,259)  (56.5)%   10,764,921   93.8%  13,525,342   100.0%  (2,760,422)  (20.4)%Revenue from distribution of pharmaceuticals                        Asia-based customers  715,362   6.2%  -   -   715,362   N/A Total revenues $11,480,283   100.0% $13,525,342   100.0% $(2,045,060)  (15.1)%                          Conference Call & Audio Webcast Lakeside's management team will hold an earnings conference call at 4:30 PM Eastern Time (3:30 PM Central Time) on Thursday, May 22 to discuss the Company's financial results and provide an overview of the Company's operations. Management will lead the conference call and be available to answer questions. To access the call by phone, please dial 1- 877-407-9716 (international callers, please dial 1- 201-493-6779) approximately 10 minutes before the start of the call. Refer to conference ID: 13753971 or LAKESIDE. **NOTE: THIS CONFERENCE ID WILL BE REQUIRED FOR ENTRY A live audio conference call webcast will be available online athttps://viavid.webcasts.com/starthere.jsp?ei=1708554&tp_key=b4f1b10725 About Lakeside Holding Limited Lakeside Holding Limited is a U.S.-based cross-border supply chain solution provider with a unique focus on the Asia-Pacific market. Through two specialized subsidiaries—American Bear Logistics and Hupan Pharmaceutical (Hubei) Co., Ltd.—Lakeside delivers tailored logistics solutions spanning general and specialized sectors. American Bear Logistics, with strategic hubs in Chicago, Dallas, Los Angeles, and New York, offers customized cross-border ocean and airfreight solutions, connecting Asia-based logistics service companies and e-commerce platforms with the U.S. market. Lakeside recently acquired Hupan Pharmaceutical (Hubei) Co., Ltd., expanding its service scope and enhancing its pharmaceutical logistics and distribution capabilities within China. This strategic move underscores Lakeside's commitment to advancing integrated cross-border logistics solutions. For more information, please visit https://lakeside-holding.com. The Company routinely updates important information on its website. Safe Harbor StatementThis press release contains forward-looking statements that reflect our current expectations and views of future events. Known and unknown risks, uncertainties and other factors may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. You can identify some of these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "is/are likely to," "potential," "continue" or other similar expressions. We have based these forward-looking statements largely on our current expectations and projections about future events that we believe may affect our financial condition, results of operations, business strategy and financial needs. These forward-looking statements involve various risks and uncertainties. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events. We qualify all of our forward-looking statements by these cautionary statements. Investor Relations Contact:Matthew Abenante, IRCPresidentStrategic Investor Relations, LLC Tel: 347-947-2093Email: matthew@strategic-ir.com (tables follow) LAKESIDE HOLDING LIMITEDCONDENSED CONSOLIDATED BALANCE SHEETSAS OF MARCH 31, 2025 AND JUNE 30, 2024(UNAUDITED)         As ofMarch 31,2025  As ofJune 30,2024   (unaudited)  (audited) ASSETS      CURRENT ASSETS      Cash $1,499,257  $123,550 Accounts receivable – third parties, net  1,397,499   2,082,152 Accounts receivable – related party, net  306,295   763,285 Prepayment and other receivable  91,426   - Contract assets  71,331   129,506 Inventories, net  216,489   - Due from related parties  856,570   441,279 Loan to a third party  573,546   - Total current assets  5,012,413   3,539,772          NON-CURRENT ASSETS        Investment in other entity  15,741   15,741 Property and equipment at cost, net of accumulated depreciation  533,993   344,883 Intangible asset, net  386,811   - Right of use operating lease assets  3,619,138   3,471,172 Right of use financing lease assets  102,398   37,476 Deferred tax asset  -   89,581 Deferred offering costs  -   1,492,798 Deposit and prepayment  269,269   202,336 Total non-current assets  4,927,350   5,653,987 TOTAL ASSETS $9,939,763  $9,193,759          LIABILITIES AND EQUITY        CURRENT LIABILITIES        Accounts payables – third parties $1,577,044  $1,161,858 Accounts payables – related parties  68,895   227,722 Accrued liabilities and other payables  1,448,588   1,335,804 Current portion of obligations under operating leases  2,389,965   1,186,809 Current portion of obligations under financing leases  48,617   37,619 Loans payable, current  617,682   746,962 Contract liabilities  42,168   - Dividend payable  -   98,850 Tax payable  106,433   79,825 Due to shareholders  -   1,018,281 Convertible notes - current  484,541     Total current liabilities  6,783,933   5,893,730          NON-CURRENT LIABILITIES        Loans payable, non-current  156,509   136,375 Loan payable to related party  124,176     Deferred tax liabilities  96,703   - Obligations under operating leases, non-current  1,815,211   2,506,402 Obligations under financing leases, non-current  72,651   17,460 Convertible note - non-current  140,792     Total non-current liabilities  2,406,042   2,660,237 TOTAL LIABILITIES $9,189,975  $8,553,967          Commitments and Contingencies                 EQUITY        Common stocks, $0.0001 par value, 200,000,000 shares authorized, 7,500,000 and 6,000,000 issued and outstanding as of March 31, 2025 and June 30, 2024, respectively  750   600 Subscription receivable  -   (600)Additional paid-in capital  5,113,511   642,639 Statutory reserve  7,014   - Deficits  (4,365,856)  (5,819)Accumulated other comprehensive income  (5,631)  2,972 Total equity  749,788   639,792          TOTAL LIABILITIES AND EQUITY $9,939,763  $9,193,759           LAKESIDE HOLDING LIMITEDCONDENSED CONSOLIDATED STATEMENT OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) FOR THE THREE MONTHS AND NINE MONTHS ENDED MARCH 31, 2025 AND 2024(UNAUDITED)         Nine Months Ended March 31,  Three Months Ended March 31,   2025  2024  2025  2024 Revenue from cross-border freight solutions – third party $9,559,567  $12,457,709  $2,857,504  $3,817,726 Revenue from cross-border freight solutions – related parties  1,205,354   1,067,633   448,360   643,037 Revenue from distribution of pharmaceutical products – third parties  715,362   -   497,276   - Total revenue  11,480,283   13,525,342   3,803,140   4,460,763                  Cost of revenue from cross-border freight solutions – third party  8,756,778   9,367,882   2,602,784   3,038,232 Cost of revenue from cross-border freight solutions – related party  1,286,380   1,469,845   365,330   446,968 Cost of revenue from pharmaceutical products – third parties  240,966   -   119,175   - Total cost of revenue  10,284,124   10,837,727   3,087,289   3,485,199 Gross profit  1,196,159   2,687,615   715,851   975,564                  Operating expenses:                Selling expenses  158,118   -   103,630   - General and administrative expenses  5,429,398   2,803,311   1,680,339   962,481 Loss from deconsolidation of a subsidiary  -   73,151   -   - Provision (reversal) of allowance for expected credit loss  8,021   22,198   6,065   (27,393)Total operating expenses  5,595,537   2,898,660   1,790,034   935,088                  (Loss) income from operations  (4,399,378)  (211,045)  (1,074,183)  40,476                  Other income                Other income, net  310,796   190,887   109,255   102,438 Interest expense  (156,266)  (79,400)  (87,274)  (25,536)Total other income  154,530   111,487   21,981   76,902                  (Loss) income before income taxes  (4,244,848)  (99,558)  (1,052,202)  117,378 Income tax expense  108,175   130,735   18,594   104,610 Net (loss) income  (4,353,023)  (230,293)  (1,070,796)  12,768 Less: net loss attributable to non-controlling interest  -   (3,025)  -   - Net (loss) income attributable to the Company  (4,353,023)  (227,268)  (1,070,796)  12,768                  Other comprehensive (loss) income:                Foreign currency translation (loss) income  (8,603)  3,122   3,583   - Comprehensive (loss) income  (4,361,626)  (227,171)  (1,067,213)  12,768 Less: comprehensive loss attributable to non-controlling interest  -   (3,119)  -   - Comprehensive (loss) income attributable to the Company $(4,361,626) $(224,052) $(1,067,213) $12,768                  Loss per share – basic and diluted $(0.58) $(0.04) $(0.14) $- Weighted Average Shares Outstanding – basic and diluted  7,500,000   6,000,000   7,500,000   6,000,000                   LAKESIDE HOLDING LIMITEDCONDENSSED CONSOLIDATED STATEMENTS OF CASH FLOWSFOR THE NINE MONTHS ENDED MARCH 31, 2025 AND 2024(UNAUDITED)      For the Nine Months Ended March 31,   2025  2024 Cash flows from operating activities:      Net loss $(4,353,023) $(230,293)Adjustments to reconcile net loss to net cash provided by operating activities:        Depreciation – G&A  86,413   53,985 Depreciation – cost of revenue  62,441   54,493 Amortization of intangible asset  32,056   - Amortization and interest expense of operating lease assets  1,515,688   658,713 Depreciation of right-of-use finance assets  24,081   22,548 Provision of allowance for expected credit loss  8,021   22,198 Interest expense of convertible note  40,541   - Deferred tax expense  81,567   36,264 Interest income  (11,645)  - Loss from derecognition of shares in subsidiary  -   73,151 Changes in operating assets and liabilities:        Accounts receivable – third parties  666,858   (283,936)Accounts receivable – related parties  466,764   (565,824)Contract assets  58,175   (58,498)Inventories, net  (216,489)  - Due from related parties  (41,230)  212,342 Due to related party  -   14,536 Prepayment and other deposit  (158,359)  2,623 Accounts payables – third parties  415,186   493,085 Accounts payables – related parties  (158,827)  57,420 Contract liabilities  42,168   - Accrued expense and other payables  393,633   111,122 Tax payable  26,608   94,471 Operating lease liabilities  (1,151,931)  (606,756)Net cash (used in) provided by operating activities  (2,171,304)  161,644          Cash flows from investing activities:        Purchase of furniture and equipment  (36,072)  - Payment for leasehold improvement  (76,456)  - Net cash payment for asset acquisition  (552,721)  - Loan to a third party  (561,901)  - Payment made for investment in other entity  -   (29,906)Net cash outflow from deconsolidation of a subsidiary (Appendix A)  -   (48,893)Net cash used in investing activities  (1,227,150)  (78,799)         Cash flows from financing activities:        Proceeds from loans  294,975   225,000 Repayment of loans  (420,765)  (200,132)Net proceeds from issuance of convertible notes  755,512   - Proceeds from a loan from a related party  124,176   - Repayment of equipment and vehicle loans  (85,591)  (89,802)Principal payment of finance lease liabilities  (22,814)  (21,485)Payment for deferring offering cost  -   (140,000)Advances from Hupan Pharmaceutical prior to acquisition  276,365   - Proceeds from initial public offering, net of share issuance costs  5,351,281   - Advances to related parties  (685,247)  - Proceeds from shareholders  -   158,455 Repayment to shareholders  (805,345)  - Net cash provided by (used in) financing activities  4,782,547   (67,964)         Effect of exchange rate changes on cash  (8,386)  3,216 Net increase in cash  1,375,707   18,097 Cash, beginning of the period  123,550   174,018 Cash, end of the period $1,499,257  $192,115          SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:        Cash paid for income tax $-  $- Cash paid for interest $67,704  $24,030          SUPPLEMENTAL SCHEDULE OF NON-CASH IN INVESTING AND FINANCING ACTIVITIES        Deferred offering costs within due to shareholders $-  $660,826 Deferred offering costs within accrued expense and other payables $-  $176,176 Property additions included in loan payable $102,235   - Additions to leasehold improvement through accounts payable and other payable $123,176   - Due to shareholder offset against due from related parties $311,185   -          NON-CASH ACTIVITIES        Right of use assets obtained in exchange for operating lease obligations $1,447,494  $- Right of use assets obtained in exchange for finance lease obligation $89,003  $19,982          APPENDIX A – Net cash outflow from deconsolidation of a subsidiary        Working capital, net     $29,812 Investment in other entity recognized      (15,741)Elimination of NCl at deconsolidation of a subsidiary      10,187 Loss from deconsolidation of a subsidiary      (73,151)Cash     $(48,893)

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