20-F/A: New Century Logistics Reports Fiscal Year 2025 Results

New Century Logistics (BVI) Limited filed an amended annual report detailing a significant revenue decrease and a substantial net loss for the fiscal year ended September 30, 2025, primarily due to reduced orders from major customers.

Summary

• New Century Logistics (BVI) Limited filed an amended annual report for the fiscal year ended September 30, 2025.
• The company reported a significant decrease in revenue, down 15.51% to $44.08 million from $52.18 million in the prior year.
• This revenue decline was mainly attributed to reduced orders from several major customers experiencing business downturns.
• The company incurred a net loss of $10.73 million for the fiscal year, a substantial decrease from a net income of $0.22 million in the previous year.
• General and administrative expenses increased significantly by 191.54% to $11.0 million, largely due to share-based compensation expenses of $6.4 million.
• The company regained compliance with Nasdaq's minimum bid price requirement in December 2025.

Sentiment

Score: 2

Explanation: StockSavvy.ai views this filing as negative due to a significant revenue decline, a substantial net loss, and a sharp decrease in gross profit margin, despite regaining Nasdaq compliance.

Positives

• The company regained compliance with Nasdaq's minimum bid price requirement in December 2025, having had its closing bid price at or above $1.00 for 12 consecutive business days.
• The company's cash and cash equivalents increased to $966,425 as of September 30, 2025, from $659,320 in the prior year.
• The company has a robust network and experienced management team with over 20 years of expertise in the freight forwarding industry.

Negatives

• Revenue decreased by 15.51% to $44.08 million for the year ended September 30, 2025, from $52.18 million in the prior year.
• The company reported a net loss of $10.73 million for the fiscal year ended September 30, 2025, compared to a net income of $0.22 million in the prior year.
• Gross profit margin significantly decreased to 0.37% from 8.13% in the prior year.
• General and administrative expenses increased by 191.54% to $11.0 million, primarily due to $6.4 million in share-based compensation expenses.
• The company identified a material weakness in its internal control over financial reporting due to a lack of adequately skilled staff possessing U.S. GAAP knowledge.

Risks

• Fluctuations in revenue, operating income, and cash flows are likely due to the volatile demand and supply in the cargo space market.
• Reliance on a limited number of vendors poses a risk, as the top five suppliers accounted for approximately 51.9% of the total cost of sales in fiscal year 2025.
• The company is subject to cyber-attacks and data breaches.
• The highly competitive nature of the freight forwarding industry could adversely affect customer base and market share.
• The company's operations are heavily influenced by the socio-economic landscape of Hong Kong.
• As a holding company, the company relies on dividends from its subsidiaries.
• Failure to comply with Nasdaq's continued listing requirements could lead to delisting.
• The company faces risks related to the political instability and regulatory environment in Hong Kong and potential PRC government intervention.
• The company may be required to recognize impairment charges for its long-lived assets.
• Increases in labor costs in Hong Kong may adversely affect the business and results of operations.
• The company's principal shareholders have substantial influence over the Company, and their interests may not align with other shareholders.
• The company may be affected by currency peg system changes in Hong Kong.
• The company's ability to obtain additional funding may be hindered if it cannot secure financing on favorable terms.

Future Outlook

The company anticipates that its overall general and administrative expenses, particularly payroll and professional expenses for consulting services, will increase in the foreseeable future due to plans to hire additional personnel and incur expenses related to business expansion. Professional fees for legal, audit, and advisory services are also expected to rise following the company's transition to a public entity.

Management Comments

• The logistics industry is expanding rapidly as online shopping fuels the need for faster and more secure deliveries.
• Meeting consumer expectations for flexible delivery options requires tight integration between inventory control, warehousing, and fulfillment operations.
• To overcome challenges like increasing transportation costs, labor gaps, and supply chain disruptions, logistics providers are relying more on advanced technologies and smarter workforce strategies.
• The company anticipates that its overall general and administrative expense, especially payroll and professional expenses for consulting service, to increase in the foreseeable future, as we plan to hire additional personnel and incur additional expenses in connection with the expansion of our business operations.
• We expect our professional fees for legal, audit, and advisory services to increase since we became a public company upon the effectiveness of our registration statement in November 2024.

Industry Context

StockSavvy.ai notes that the logistics industry is experiencing rapid growth driven by e-commerce, leading to increased demand for integrated supply chain solutions. However, the sector faces challenges from rising costs and labor shortages, prompting a shift towards technology adoption and optimized workforce strategies.

Corporate Governance

Legal Proceedings

• The company received a letter from Craft Capital alleging breach of an engagement agreement and demanding compensation, which was subsequently resolved through a new engagement agreement and reimbursement of legal fees.
• The company is not aware of any pending or threatened claims and litigation as of September 30, 2024 and 2025.

Related Party Transactions

• As of September 30, 2025, there were no outstanding balances with related parties.
• As of September 30, 2024, there was a loan payable to Asia International Securities Exchange Co., Limited of $2.43 million and amounts due from directors (Lam Shing Kwan Henry, Ngan Ching Shun, Ng Yi To Peter) totaling $0.78 million.
• These related party balances were fully repaid in December 2024.
• Guarantees for bank loans and overdrafts were provided by directors Mr. Lam Shing Kwan Henry and Mr. Ngan Ching Shun, including a second legal mortgage on a property owned by Mr. Lam.

Stakeholder Impact

• Shareholders may face less protection due to reliance on BVI corporate governance practices.
• The material weakness in internal controls could affect investor confidence and the market price of Ordinary Shares.
• The company's ability to raise future funds could be impacted if it fails to satisfy Nasdaq's continued listing requirements.
• The significant increase in general and administrative expenses, particularly share-based compensation, impacts profitability and potentially shareholder returns.

Next Steps

• Implement measures to address the material weakness in internal controls, including hiring additional accounting personnel and establishing a financial and system control framework.
• Initiate regular U.S. GAAP and SEC financial reporting training programs for accounting and financial personnel.
• Develop and implement policies and procedures for period-end financial reporting.
• Continue to monitor and manage cybersecurity risks.
• The company has plans to enhance its Asian presence and advance its global logistics ecosystem through potential acquisitions, such as the intended acquisition of 51% of Asiatic Logistics Limited.

Key Dates

Recommendation

While the company has regained Nasdaq compliance, the significant decline in revenue, substantial net loss, and sharp decrease in gross profit margin indicate a challenging financial performance for the fiscal year. The increase in G&A expenses, driven by share-based compensation, further pressures profitability. The company's ability to recover and execute its expansion plans will be critical for future performance. Therefore, a 'hold' recommendation is appropriate pending signs of operational improvement and stabilization.

Keywords

New Century Logistics, Form 20-F/A, SEC Filing, Freight Forwarding, Logistics Services, Hong Kong, Financial Results, Annual Report, Nasdaq Listing