EX-99.1 2 ea022627801ex99-1_ddcenter.htm PRESS RELEASE DATED DECEMBER 31, 2024

Exhibit 99.1

 

DDC Enterprise Limited Announces Unaudited First Half of 2024 Financial Results

 

-Reduced US$5.6 million in debt by converting debt into equity
-Shareholder equity increased by 109% to US$19.7 million compared to the year ended 31 December, 2023
-U.S. revenue increased to 15.3% of total revenue versus nil for the six months ended June 30, 2023

 

New York, New York, December 31, 2024 (GLOBE NEWSWIRE) – DDC Enterprise, Limited. (the “Company”, “we” or “DDC”) (NYSE Amex: DDC), today announced its unaudited financial results for the first six months of 2024.

 

Key Highlights for the First Half of 2024

 

Total revenues increased to US$17.2 million, up from US$12.3 million in the same period of 2023, representing a 40% increase.

 

Gross profit margin remained stable at approximately 26% compared to the same period of 2023.

 

The Company continued to expand its footprint in the Asia food space in the U.S. market. During the first six months of 2024, the Company acquired Yai’s Thai, which provides Thai-based pantry staples in the U.S. market such as curries and stir-fry sauces, making it the second wholly-owned brand in the U.S. market.

 

During the reporting period, the Company refinanced US$5.6 million of debt by converting it into Class A Ordinary shares.

 

Expanded management team in the U.S. market by hiring Malik Sadiq, who has more than 25 years of experience in the food and strategy consulting industry in China, India, and the US, as the Company’s Chief Operating Officer, and Jeffrey S. Ervin, who was the co-founded of IMAC Holdings, Inc. (NASDAQ: BACK), as the Company’s Co-Chief Financial Officer as DDC continue to invest in the Asia food space globally.

 

Norma Chu, CEO of DDC commented, “Despite the challenges we’ve faced, I am proud of our team’s relentless commitment to growth and innovation. Our strategic acquisitions and operational efficiencies position us strongly for the future as we continue to expand our footprint in the U.S. market. We are excited about the opportunities ahead and remain dedicated to delivering value to our shareholders and customers alike.”

 

 

 

 

ABOUT DAYDAYCOOK

 

DayDayCook (NYSEAM: DDC) is on a mission to share the joy of Asian cooking culture with the world, offering a suite of accessible and healthy ready-to-eat, ready-to-cook, and ready-to-heat products that cater to the global palate. DayDayCook has evolved from a culinary content authority to a multi-brand powerhouse, curating a broad range of products that champion authenticity, nutrition, and convenience. The company's growing portfolio includes DayDayCook, Nona Lim, Yai’s Thai, and Omsom.

 

Forward-Looking Statements

 

Certain statements in this press release are forward-looking statements, including, for example, statements about estimated revenue, margins, cash and growth and expansion. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company’s current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. These forward-looking statements are also based on assumptions regarding the Company’s present and future business strategies and the environment in which the Company will operate in the future. Investors can find many (but not all) of these statements by the use of words such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “likely to” or other similar expressions. The Company undertakes no obligation to update or revise publicly any 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 other factors that may affect its future results in the Company’s registration statement and other filings with the SEC.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20241022747650/en/

 

Investors:

 

Jeff Ervin
Co-Chief Financial Officer
jeffervin@daydaycook.com

 

Media:

 

Jaque Liu
jaque.liu@daydaycook.com

 

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DDC ENTERPRISE LIMITED

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

 

   For the Six Months Ended June 30， 
   2023   2024 
   RMB   RMB   US$ 
             
Revenues:            
Product revenues   89,126,070    122,513,685    17,190,560 
Service revenues   298,737    385,031    54,026 
Total revenues   89,424,807    122,898,716    17,244,586 
                
Cost of products   (65,754,556)   (91,031,202)   (12,773,083)
Cost of services   (265,392)   (81,873)   (11,488)
Total cost of revenues   (66,019,948)   (91,113,075)   (12,784,571)
                
Gross profit   23,404,859    31,785,641    4,460,015 
                
Operating expenses:               
Fulfilment expenses   (3,034,022)   (5,056,932)   (709,566)
Sales and marketing expenses   (7,277,737)   (9,669,218)   (1,356,740)
General and administrative expenses   (20,761,268)   (33,589,607)   (4,713,140)
Share based compensation   (3,121,666)   (9,240,373)   (1,296,567)
Total operating expenses   (34,194,693)   (57,556,130)   (8,076,013)
                
Loss from operations   (10,789,834)   (25,770,489)   (3,615,998)
                
Interest expenses   (9,439,287)   (8,488,238)   (1,191,031)
Interest income   1,072,886    1,419,568    199,187 
Foreign currency exchange gain/(loss), net   33,791    (7,375)   (1,035)
Other income   351,449    142,683    20,021 
Changes in fair value of financial instruments   12,651,972    -    - 
                
Loss before income tax expenses   (6,119,023)   (32,703,851)   (4,588,856)
                
Income tax expense   (2,834,095)   (4,042,618)   (567,242)
Net loss   (8,953,118)   (36,746,469)   (5,156,098)
                
Accretion of redeemable convertible preferred shares to redemption value   (59,603,833)   -    - 
Net loss attributable to ordinary shareholders   (68,556,951)   (36,746,469)   (5,156,098)
                
Net loss attributable to non-controlling interest   3,122,783    4,404,877    618,072 
                
Net loss attributable to DDC Enterprise Limited   (71,679,734)   (41,151,346)   (5,774,170)

 

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DDC ENTERPRISE LIMITED
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS – (Continued)

 

  

 

For the Six Months Ended June 30，

 
   2023   2024 
   RMB   RMB   US$ 
             
Other comprehensive loss, net of nil income taxes:            
Foreign currency translation adjustment, net of nil income taxes   (58,857,569)   (2,035,230)   (285,574)
Net unrealized gains on available-for-sale debt
Securities		   -    2,989,431    419,463 
                
Total other comprehensive (loss)/income   (58,857,569)   954,201    133,889 
                
Comprehensive loss:   (127,414,520)   (35,792,268)   (5,022,209)
Comprehensive income attributable to non-controlling interests   3,122,783    4,404,877    618,072 
                
Comprehensive loss attributable to DDC Enterprise Limited   (130,537,303)   (40,197,145)   (5,640,281)
                
Net loss per ordinary share               
— Basic and diluted – Class A   (12.71)   (1.83)   (0.26)
— Basic and diluted – Class B   -    -    - 
                
Weighted average number of ordinary shares outstanding used in computing net loss per ordinary share               
— Basic and diluted – Class A   5,638,277    22,432,700    22,432,700 
— Basic and diluted – Class B   875,000    875,000    875,000 

 

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Use of Non-GAAP Financial Measure

 

The Company used adjusted EBITDA, non-GAAP financial measures, in evaluating its operating results and for financial and operational decision-making purposes. Adjusted EBITDA represents net loss excluding changes in income tax expense, interest expenses, interest income, foreign currency exchange loss/(gain), other income, depreciation and amortization, gains arising from modification of financial instruments, and share-based compensation.

 

The Company provided adjusted EBITDA because we believe that investors and analysts may find it useful in measuring operating performance.

 

Reconciliation from net loss to adjusted EBITDA

 

   For the Six months Ended
June 30,		 
   2023   2024   2024 
   RMB   RMB   US$ 
Net loss   (8,953,118)   (36,746,469)   (5,156,097)
Add:               
Income tax expense   2,834,095    4,042,618    567,242 
Interest expenses   9,439,287    8,488,238    1,191,031 
Interest income   (1,072,886)   (1,419,568)   (199,187)
Foreign currency exchange (gain)/loss, net   (33,791)   7,375    1,035 
Other income   (351,449)   (142,683)   (20,021)
Changes in fair value of financial instruments   (12,651,972)   -    - 
Depreciation and amortization   1,418,629    1,982,413    278,163 
Share-based compensation   3,121,666    9,240,373    1,296,567 
Adjusted EBITDA   (6,249,539)   (14,547,703)   (2,041,267)

 

For the six months ended June 30, 2023 and 2024, the Company incurred an adjusted EBITDA with loss of RMB6.2 million and RMB14.5 million (US$2.0 million) respectively.

 

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DDC ENTERPRISE LIMITED

UNAUDITED CONSOLIDATED BALANCE SHEETS

 

   December 31,   June 30, 
   2023   2024 
   RMB   RMB   US$ 
             
ASSETS            
Current assets            
Cash and cash equivalents   78,790,697    79,941,616    11,217,042 
Restricted cash   497,108    53    7 
Short-term investment   104,086,826    124,888,519    17,523,786 
Accounts receivable, net   29,508,542    54,921,678    7,706,359 
Inventories   9,984,100    10,084,426    1,415,001 
Prepayments and other current assets   97,589,397    117,032,618    16,421,482 
                
Total current assets   320,456,670    386,868,910    54,283,677 
                
Non-current assets               
Long-term investments   14,136,050    14,136,050    1,983,506 
Property, plant and equipment, net   603,035    481,501    67,562 
Operating lease Right-of-use assets   6,169,983    5,015,252    703,717 
Intangible assets, net   9,426,569    31,912,386    4,477,800 
Goodwill   46,999,355    100,699,401    14,129,680 
Other non-current assets   43,150,129    41,366,390    5,804,343 
                
Total non-current assets   120,485,121    193,610,980    27,166,608 
                
Total assets   440,941,791    580,479,890    81,450,285 

 

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DDC ENTERPRISE LIMITED
UNAUDITED CONSOLIDATED BALANCE SHEETS – (Continued)

 

   December 31,   June 30, 
   2023   2024 
   RMB   RMB   US$ 
             
LIABILITIES AND SHAREHOLDERS’ EQUITY            
Current liabilities            
Short-term bank borrowings   19,500,000    43,500,000    6,103,721 
Current portion of long-term bank borrowings   1,993,168    1,853,791    260,115 
Accounts payable   20,793,699    39,793,134    5,583,591 
Contract liabilities   13,773,974    31,568,757    4,429,584 
Shareholder loans, at amortized cost   26,150,243    81,406,491    11,422,587 
Amounts due to related parties   17,605,694    21,191,036    2,973,429 
Accrued expenses and other current liabilities   168,952,161    174,081,709    24,426,349 
Current portion of lease liabilities   2,590,785    1,957,352    274,647 
Current portion of finance lease liabilities   103,310    86,111    12,083 
Convertible loans, at fair value   6,372,830    8,807,788    1,235,869 
Convertible loans, at amortized cost   3,541,350    7,041,350    988,010 
                
Total current liabilities   281,377,214    411,287,519    57,709,985 
                
Non-current liabilities               
Long-term bank borrowings   5,519,461    4,700,394    659,538 
Operating lease liabilities   4,045,089    3,545,569    497,498 
Finance lease liabilities   37,411    -    - 
Warrant liabilities   87,279    87,279    12,247 
Shareholder loans, at amortized cost   56,928,815    -    - 
Convertible loans, at fair value   7,964,014    1,068,651    149,948 
Convertible loans, at amortized cost   3,500,000    -    - 
Deferred tax liabilities   3,827,489    8,694,628    1,219,990 
Other non-current liabilities   10,405,554    10,405,554    1,460,060 
                
Total non-current liabilities   92,315,112    28,502,075    3,999,281 
                
Total liabilities   373,692,326    439,789,594    61,709,266 

 

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DDC ENTERPRISE LIMITED
UNAUDITED CONSOLIDATED BALANCE SHEETS – (Continued)

 

   December 31,   June 30, 
   2023   2024 
   RMB   RMB   US$ 
             
Shareholders’ equity            
Class A ordinary shares (US$0.016 par value per share, 55,248,154 shares and 200,000,000 shares authorized as of December 31, 2023 and June 30, 2024, respectively; 20,028,168 shares and 31,168,607 shares issued and outstanding as of December 31, 2023 and June 30, 2024, respectively)   2,230,296    3,500,627    491,192 
Class B ordinary shares (US$0.016 par value per share, 875,000 shares and 1,700,000 shares authorized as of December 31, 2023 and June 30, 2024, respectively; 875,000 shares issued and outstanding as of December 31, 2023 and June 30, 2024, respectively)   96,589    96,589    13,553 
Additional paid-in-capital   1,816,654,303    1,924,617,071    270,053,470 
Accumulated deficit   (1,637,790,086)   (1,678,941,432)   (235,581,388)
Accumulated other comprehensive loss   (135,581,744)   (134,627,543)   (18,890,321)
Total shareholders’ equity attributable to DDC Enterprise Limited   45,609,358    114,645,312    16,086,506 
                
Non-controlling interest   21,640,107    26,044,984    3,654,513 
                
Total shareholders’ equity   67,249,465    140,690,296    19,741,019 
                
Total liabilities and shareholders’ equity   440,941,791    580,479,890    81,450,285 

 

 

 

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