10-K: Elvictor Group Reports Net Income for 2024, Citing Revenue Increase and Cost Reductions

Sentiment:

Annual Report 14 April 2025 2:18 PM

Elvictor Group, Inc. announces a net income of $199,780 for the year ended December 31, 2024, a significant turnaround from the previous year's net loss, driven by increased revenues and reduced operating expenses.

Capital raiseThe company has entered into an engagement agreement with CIM Securities, LLC to raise up to $7,000,000 in a Regulation D, Rule 506(c) offering.The financing would be used to purchase a bulker vessel, most likely a Handy size type of vessel with a deadweight tonnage ranging from 30,000 to 40,000 tons with an age of approximately five to eight years.The estimated total vessel cost will range between $20,000,000 to $22,000,000 while the overall equity participation would be between $5,500,000 and $6,500,000, including initial working capital costs.

Better than expectedThe company reported a net income of $199,780 compared to a net loss of $222,727 in the previous year.

Summary

Elvictor Group, Inc. reported a net income of $199,780 for the year ended December 31, 2024, compared to a net loss of $222,727 in 2023.
The company's revenue increased by 2.5% to $2,421,308 in 2024, primarily due to an increase in fees such as allotment and communication fees.
Operating expenses decreased by 21.1% to $1,691,050 in 2024, mainly due to salary reductions and restructuring of operational costs.
The company manages over 2,300 seafarers of ten different nationalities across seven different ship types.
Elvictor Group is planning to purchase a bulker vessel with a deadweight tonnage ranging from 30,000 to 40,000 tons with an age of approximately five to eight years.
The estimated total vessel cost will range between $20,000,000 to $22,000,000 while the overall equity participation would be between $5,500,000 and $6,500,000, including initial working capital costs.
The company intends to continue funding its business through equity and debt financing, either alone or through strategic alliances.
The company has identified material weaknesses in its internal controls over financial reporting.
The company has a net operating loss carryforward of approximately $941,795 available for federal income tax purposes.
The company's professional fees have decreased from $677,420 for the year ended December 31, 2022, to $337,547 for the year ended December 31, 2023, representing a decrease of 50.2%.

Sentiment

Score: 7

Explanation: The document presents a mixed sentiment. While the company reports a positive net income and revenue increase, there are concerns about internal control weaknesses, geopolitical risks, and competitive pressures. The planned capital raise and vessel purchase indicate growth potential, but also increased risk.

Positives

The company achieved a net income of $199,780 in 2024, a significant improvement from the previous year.
Revenue increased by 2.5% to $2,421,308.
Operating expenses decreased by 21.1% to $1,691,050 due to cost-saving measures.
The company is expanding its services by integrating ship ownership to diversify revenue streams.
The company has over 65 years of combined experience in the shipping sector.
The company's smaller size and simpler internal structure allows for flexibility and tailor-made solutions for clients.

Negatives

The company identified material weaknesses in its internal controls over financial reporting.
The company is subject to numerous laws and regulations in the United States, Europe and other jurisdictions in which it operates.
The company faces increasing pressures due to residual impacts from the COVID-19 pandemic, in addition to continued geopolitical instability related to the Ukraine conflict and the Red Sea crisis.
The company's competitors have significantly greater financial and operational resources, longer operating histories, greater marketing and advertising capabilities, and broader geographic presence.

Risks

Significant geopolitical risks, such as the Red Sea crisis, could escalate operational and security challenges, impacting shipping routes and insurance costs.
Rising inflation could materially affect the business due to increases in seafarer salaries and costs to customers.
Fluctuations in global economic conditions may reduce demand for services and adversely impact the business.
The war in Ukraine or civil unrests could impact crewing and the global shipping industry.
Increasing threat of AI-driven cyberattacks and data breaches in the maritime industry may affect operations.
Reliance on technology and cybersecurity procedures to effectively collect, protect and store sensitive and confidential information poses a risk.
Increased regulatory cost of compliance, including data privacy regulations, could impact the business.

Future Outlook

The shipping industry and crew management segments will likely continue to face increasing pressures due to the COVID-19 pandemic, geopolitical instability, and inflationary pressures.

Management Comments

Our management team is assessing alternative plans to mitigate potential challenges arising from the ongoing war in the Ukraine, among other things.
The demand for our services depends on the demand for maritime shipping services which are subject to normal economic cycles affecting the general economy including the effect of increased inflation.

Industry Context

The report acknowledges the challenges in the shipping industry due to geopolitical events like the Ukraine conflict and the Red Sea crisis, which impact the safety and security of seafarers and shipping in the area.

Comparison to Industry Standards

The document does not provide specific comparisons to industry standards or comparable companies.
The document mentions that many of the company's competitors have significantly greater financial and operational resources, longer operating histories, greater marketing and advertising capabilities, and broader geographic presence.

Related Party Transactions

The company has related party transactions with companies that are owned or controlled by either Mr. Stavros Galanakis, the Vice-President and Chairman of the Board of Directors, and Mr. Konstantinos Galanakis, the CEO and Director.
The company has entered into an agreement in October 2020 with related party Elvictor Crew Management Services Ltd in Cyprus to provide human resources services as well as to perform the running and management of the Companys contracts with third parties and provide key personnel for these services.
On September 11, 2020, the Company entered into a Manning Agency Agreement with Elvictor Crew Management Service Ltd in Georgia.
On September 1, 2020, the Company signed an agreement with Qualship Georgia Ltd for the latter to provide training of the qualified personnel.
On September 11, 2020, the Company entered into a Manning Agency Agreement with Elvictor Odessa.
As disclosed in Note 4 above, the company entered into an agreement with Seatrix Software Production Single Member S.A. to provided software development services.
On July 10, 2020, the Company entered into a rental lease agreement with the wife of Mr. Stavros Galanakis for its subsidiary, Elvictor Group Hellas Single Member S.A., in Vari, Greece.
Then on October 1, 2021, the Company entered into a second lease agreement with the wife of Mr. Stavros Galanakis for its new subsidiary, Elvictor Group Hellas Single Member S.A., in Vari, Greece.

Stakeholder Impact

Shareholders may be impacted by the potential dilution from the equity financing.
Employees may be impacted by the cost-saving measures and restructuring of operational costs.
Customers may be impacted by the company's ability to provide services in light of geopolitical risks and inflationary pressures.
Seafarers may be impacted by the company's ability to attract and retain qualified personnel due to the war in Ukraine and other factors.

Next Steps

The company plans to continue its crew and ship management services and expand in Turkey and other countries.
The company plans to purchase a bulker vessel with the funds raised from the Regulation D offering.
The company intends to continue to address the material weaknesses in its internal controls over financial reporting.

Key Dates

Date	Description
November 3, 2017	Elvictor Group, Inc. was incorporated in Nevada as Thenablers, Inc.
October 2019	New directors were appointed to promote and expand the business with specific knowledge of crew management services.
November 5, 2019	Konstantinos Galanakis was appointed as Chief Executive Officer and Stavros Galanakis as Chairman of the Board of Directors.
December 13, 2019	The company's name was changed from Thenablers, Inc. to Elvictor Group, Inc.
February 27, 2020	The company's trading symbol in the OTC Pink Open Market was changed to ELVG.
July 7, 2020	The company entered into a Settlement Agreement and Release with the holders of the Series A Preferred Stock.
August 8, 2020	Elvictor Group Hellas Single Member SA., a wholly owned subsidiary in Vari, Greece, was formed.
September 2020	The company began its business operations to provide crew management services to vessels around the world.
October 1, 2021	The Company entered into a second lease agreement with the wife of Stavros Galanakis for its then new subsidiary in Vari, Greece for Ultra Ship Management.
October 2021	The company acquired 100% of the outstanding equity interests of Ultra Shipmanagement, Inc.
January 10, 2022	ELVG Crew Management Limited, a wholly owned subsidiary in Cyprus, was formed.
January 2022	ELVG Crew Management Ltd, a wholly owned subsidiary, was established in Cyprus.
December 23, 2024	The company announced an engagement agreement with CIM Securities, LLC to raise up to $7,000,000 in a Regulation D offering.
April 14, 2025	Date of the report.

Keywords

crew management, ship management, seafarers, shipping, maritime, recruitment, vessel, crewing, ELVG, Elvictor

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