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TIAN RUIXIANG Holdings Ltd Reports Financial Results for Fiscal Year Ended October 31, 2023

TIRX

BEIJING, July 17, 2024 (GLOBE NEWSWIRE) -- TIAN RUIXIANG Holdings Ltd (Nasdaq: TIRX) (the "Company"), a China-based insurance broker conducting business through its variable interest entity in China, today announced its financial results for the fiscal year ended October 31, 2023.

Ms. Sheng Xu, the Chief Executive Officer of the Company, commented, “For the year ended October 31, 2023, the Company generated revenue of about $1.2 million, representing an 8.0% decrease compared to the prior year's revenue. This decline was primarily attributable to the lower commissions from several insurance products and loss of certain insurance company partners amid an increasingly competitive market and challenging macroeconomic environment in China.”

“However, we achieved a significant increase of approximately $612,000 in the commissions from our liability insurance products, driven by our efforts to expand our liability insurance business.”

“Despite the revenue decline, we were able to reduce the net loss by 47.6% to $2.5 million, down from $4.7 million in the prior year. Overall, while we faced headwinds in certain insurance products, we were able to drive substantial growth in the liability insurance commissions, which is a positive indicator for the Company's strategic focus. Additionally, the reduction in the net loss demonstrates improved financial performance and operational efficiency compared to the prior year.”

Selected Fiscal Year 2023 Financial Metrics

Years Ended October 31,
Changes in
($ in millions, except per share data, differences due to rounding.) 2023
2022
Percentage
Revenues $ 1.2 $ 1.4 (8.0) %
Total operating expenses 4.3 6.4 (33.6) %
Loss from operations (3.0) (5.1) (40.5) %
Net loss (2.5) (4.7) (47.6) %
Loss per share (3.87) (9.03) (55.4) %

  • Revenue decreased by 8.0% to $1.2 million for the year ended October 31, 2023, compared with $1.4 million for the same period in 2022.
  • Total operating expenses were $4.3 million for the year ended October 31, 2023, decreased from $6.4 million for the same period in 2022.
  • Loss from operations narrowed by 40.5% to $3.0 million for the year ended October 31, 2023, from $5.1 million for the same period in 2022.
  • Net loss also decreased by 47.6% to $2.5 million for the year ended October 31, 2023, from $4.7 million for the same period in 2022.

About TIAN RUIXIANG Holdings Ltd

TIAN RUIXIANG Holdings Ltd, headquartered in Beijing, China, is an insurance broker operating in China through its China-based variable interest entity. It distributes a wide range of insurance products, which are categorized into two major groups: (1) property and casualty insurance, such as commercial property insurance, liability insurance, accidental insurance, and automobile insurance; and (2) other types of insurance, such as health insurance, life insurance, and other miscellaneous insurance. For more information, visit the company's website at http://ir.tianrx.com/.

Forward-Looking Statements

Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review risk factors that may affect its future results in the Company's registration statement and in its other filings with the U.S. Securities and Exchange Commission.

For investor and media enquiries, please contact:

TIAN RUIXIANG Holdings Ltd
Investor Relations Department
Email: ir@tianrx.com

Wealth Financial Services LLC
Connie Kang
Partner
Email: ckang@wealthfsllc.com
Tel: +86 1381 185 7742 (CN)


TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(IN U.S. DOLLARS)
As of October 31,
2023 2022
ASSETS
CURRENT ASSETS:
Cash $ 2,383 $ 2,508
Restricted cash 692,692 692,734
Short-term investments 26,797,081 26,179,662
Accounts receivable 18,960 51,202
Note receivable 7,500,000
Interest receivable 262,192
Due from related party 1,369
Other current assets 107,508 168,957
Total Current Assets 27,618,624 34,858,624
NON-CURRENT ASSETS:
Note receivable 7,800,000
Property and equipment, net 6,280 8,688
Right-of-use assets, operating leases, net 54,870 143,438
Other non-current assets 20,078
Total Non-current Assets 7,861,150 172,204
Total Assets $ 35,479,774 $ 35,030,828
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Taxes payable $ 623,825 $ 466,878
Salary payable 726,330 424,987
Accrued liabilities and other payables 481,801 384,893
Due to related parties 1,173,510 126,530
Operating lease liabilities 57,402 90,800
Total Current Liabilities 3,062,868 1,494,088
NON-CURRENT LIABILITIES:
Operating lease liabilities - noncurrent portion 54,718
Total Non-current Liabilities 54,718
Total Liabilities 3,062,868 1,548,806
EQUITY:
TIAN RUIXIANG Holdings Ltd Shareholders' Equity:
Ordinary shares: $0.025 par value; 40,000,000 shares authorized;
Class A ordinary shares: $0.025 par value; 36,000,000 shares authorized; 674,949 shares issued and outstanding at October 31, 2023; 507,440 shares issued and 505,440 shares outstanding at October 31, 2022 16,874 12,636
Class B ordinary shares: $0.025 par value; 4,000,000 shares authorized; 50,000 shares issued and outstanding at October 31, 2023 and 2022 1,250 1,250
Additional paid-in capital 44,108,774 42,663,012
Less: ordinary stock held in treasury, at cost; 0 share at October 31, 2023 and 2,000 shares at October 31, 2022
Accumulated deficit (8,303,691 ) (5,800,817 )
Statutory reserve 275,150 226,253
Accumulated other comprehensive loss (3,681,845 ) (3,620,712 )
Total TIAN RUIXIANG Holdings Ltd shareholders' equity 32,416,512 33,481,622
Non-controlling interest 394 400
Total Equity 32,416,906 33,482,022
Total Liabilities and Equity $ 35,479,774 $ 35,030,828


TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(IN U.S. DOLLARS)
For the Years Ended October 31,
2023 2022 2021
REVENUES
Commissions $ 1,244,247 $ 1,324,655 $ 2,675,611
Risk management services 27,254 115,006
Total Revenues 1,244,247 1,351,909 2,790,617
OPERATING EXPENSES
Selling and marketing 2,438,248 1,764,909 2,517,497
General and administrative - professional fees 1,220,367 1,185,930 1,011,053
General and administrative - compensation and related benefits 460,791 2,691,751 948,900
General and administrative - other 141,167 654,587 566,971
Impairment loss 123,646
Total Operating Expenses 4,260,573 6,420,823 5,044,421
LOSS FROM OPERATIONS (3,016,326 ) (5,068,914 ) (2,253,804 )
OTHER INCOME (EXPENSE)
Interest income 731,961 434,406 315,070
Other (expense) income (8,278 ) (26,042 ) 18,686
Total Other Income, net 723,683 408,364 333,756
LOSS BEFORE INCOME TAXES (2,292,643 ) (4,660,550 ) (1,920,048 )
INCOME TAXES 161,339 23,639 24,529
NET LOSS $ (2,453,982 ) $ (4,684,189 ) $ (1,944,577 )
LESS: NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST (5 ) (32 ) (28 )
NET LOSS ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD ORDINARY SHAREHOLDERS $ (2,453,977 ) $ (4,684,157 ) $ (1,944,549 )
NET LOSS PER ORDINARY SHARE ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD ORDINARY SHAREHOLDERS:
Basic and diluted $ (3.87 ) $ (9.03 ) $ (5.65 )
WEIGHTED AVERAGE ORDINARY SHARES OUTSTANDING:
Basic and diluted 633,336 518,655 344,425
COMPREHENSIVE LOSS:
NET LOSS $ (2,453,982 ) $ (4,684,189 ) $ (1,944,577 )
OTHER COMPREHENSIVE (LOSS) INCOME
Unrealized foreign currency translation (loss) gain (61,134 ) (3,717,478 ) 214,123
COMPREHENSIVE LOSS (2,515,116 ) (8,401,667 ) (1,730,454 )
LESS: COMPREHENSIVE LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST (6 ) (89 ) (6 )
COMPREHENSIVE LOSS ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD ORDINARY SHAREHOLDERS $ (2,515,110 ) $ (8,401,578 ) $ (1,730,448 )


TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN U.S. DOLLARS)
For the Years Ended October 31,
2023 2022 2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (2,453,982 ) $ (4,684,189 ) $ (1,944,577 )
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation expense and amortization of intangible assets 1,631 22,853 27,447
Amortization of right-of-use assets 78,126 185,421 227,661
Impairment loss 123,646 696
Stock-based compensation and service expense 1,450,000 2,888,787
Bad debt provision 7,338
Loss on disposal of property and equipment 848
Changes in operating assets and liabilities:
Accounts receivable 25,983 254,109 969,374
Security deposit 6,726 37,853 (43,750 )
Interest receivable 262,192 (149,178 ) (113,014 )
Due from related party 1,417 (1,511 )
Other assets 91,348 495,668 (74,120 )
Taxes payable 163,500 36,553 (78,932 )
Salary payable 347,567 349,436
Accrued liabilities and other payables 99,649 304,576 (123,052 )
Due to related parties 992,277 126,228 12,025
Operating lease liabilities - related party (29,355 )
Operating lease liabilities (80,316 ) (189,012 ) (194,341 )
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 994,304 (198,760 ) (1,363,938 )
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (2,346 ) (3,411 )
Investment in note receivable (7,800,000 ) (7,500,000 )
Proceeds from note receivable 7,500,000
Purchase of short-term investments (27,779,231 ) (29,011,783 ) -
Proceeds from sale of short-term investments 27,086,514 116,663 -
NET CASH USED IN INVESTING ACTIVITIES (992,717 ) (28,897,466 ) (7,503,411 )
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from note payable 75,581
Repayment of note payable (75,581 )
Proceeds from related parties' borrowings 9,535 225,171 1,893,932
Repayments of related parties' borrowings (9,818 ) (225,171 ) (2,272,145 )
Proceeds from initial public offering 12,300,000
Disbursements for initial public offering costs (1,489,388 )
Proceeds from the June 2021 public offering 24,562,500
Disbursements for the June 2021 public offering costs (2,352,418 )
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES (283 ) 32,642,481
EFFECT OF EXCHANGE RATE ON CASH AND RESTRICTED CASH (1,471 ) (1,052,173 ) 145,014
NET (DECREASE) INCREASE IN CASH AND RESTRICTED CASH (167 ) (30,148,399 ) 23,920,146
CASH AND RESTRICTED CASH - beginning of year 695,242 30,843,641 6,923,495
CASH AND RESTRICTED CASH - end of year $ 695,075 $ 695,242 $ 30,843,641
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for:
Interest $ $ 22 $ 725
Income taxes $ 807 $ $ 2,251
NON-CASH INVESTING AND FINANCING ACTIVITIES
Reissuance of treasury stock $ 25,000 $ $
Payments made by related parties on the Company’s behalf $ 1,068,700 $ $ 119,886
RECONCILIATION OF CASH AND RESTRICTED CASH
Cash at beginning of year $ 2,508 $ 30,024,372 $ 6,137,689
Restricted cash at beginning of year 692,734 819,269 785,806
Total cash and restricted cash at beginning of year $ 695,242 $ 30,843,641 $ 6,923,495
Cash at end of year $ 2,383 $ 2,508 $ 30,024,372
Restricted cash at end of year 692,692 692,734 819,269
Total cash and restricted cash at end of year $ 695,075 $ 695,242 $ 30,843,641

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