Golden Heaven Group Holdings Ltd. Announces Financial Results for the First Half of Fiscal Year 2023

NANPING, China, Aug. 3, 2023 /PRNewswire/ -- Golden Heaven Group Holdings Ltd. ("Golden Heaven" or the "Company") (Nasdaq: GDHG) is an offshore holding company incorporated in the Cayman Islands with no material operations of its own. Through its Chinese operating entities, the Company manages and operates six properties consisting of amusement parks, water parks and complementary recreational facilities. The Company today announced its unaudited financial results for the six months ended March 31, 2023 ("First Half 2023").

First Half 2023 Financial Highlights

• Revenue was RMB140.1 million in the First Half 2023, an increase of 6.0% from RMB132.1 million in the same period of last year.
• Gross profit was RMB101.0 million in the First Half 2023, an increase of 7.5% from RMB94.0 million in the same period of last year. Gross margin was 71.37% in the First Half 2023, an increase of 1.02 percentage points from 70.35% in the same period of last year.
• Income from operations was RMB72.9 million in the First Half 2023, an increase of 11.1% from RMB65.6 million in the same period of last year.
• Net income was RMB51.8 million in the First Half 2023, an increase of 12.0% from RMB46.3 million in the same period of last year.
• Earnings per share was RMB1.05 in the First Half 2023, an increase of 135.1% from RMB0.45 in the same period of last year.

First Half 2023 Financial Results

Revenue

Given the substantial appreciation of the United States dollar during the previous fiscal year, our financial results, when represented in USD, do not adequately capture the complete financial performance of the Company. Consequently, in order to provide a more comprehensive understanding, we will supplement our USD-based financial reporting with key financial metrics expressed in our local currency, the Renminbi (RMB).

Our revenue is derived from sales of in-park recreation and rental income. The total revenue decreased by $695,722, or 3.35%, from $20,756,934 for the six months ended March 31, 2022 to $20,061,212 for the six months ended March 31, 2023, or increased by approximately 6.0% from RMB132,119,961 to RMB140,101,486 for the corresponding period.

No other revenue from other services occurred in the first six months of fiscal year 2023.

Our revenue from each of our revenue segments is summarized as follows:

For the six months ended March 31, 2023:

For the six months ended March 31, 2022:

Sales of in-park recreation

For the six months ended March 31, 2023, revenue from sales of in-park recreation increased by approximately RMB7.9 million compared to the same period in 2022. Such increase was mainly attributable to an increase in visitors after China lessened the COVID-19 travel restrictions in late 2022. The USD amount for the period decreased by approximately $0.66 million compared to the same period last year due to the impact of exchange rate changes.

Rental income

For the six months ended March 31, 2023, rental income increased by approximately RMB0.07 million compared to the same period in 2022. Such increase was mainly due to the rental payment from the Children's Castle project, which started to generate revenue in Yueyang Amusement World on October 1, 2022. The Children's Castle project has an 18-year term that will expire on September 30, 2039, unless it is earlier terminated. The rental payment for the Children's Castle project is RMB100,000 per year and increases by 10% every three years. The rental payment from October 1, 2021 to September 30, 2022 was waived by the Company. The decrease in rental income of approximately $0.04 million for the six months ended March 31, 2023 compared to the same period last year was due to the impact of exchange rate changes.

Cost of Revenue

Cost of revenue increased by RMB0.88 million for the six months ended March 31, 2023 compared to the same period in 2022. Such increase was mainly because the number of visitors increased after China lessened the COVID-19 travel restrictions in late 2022, and the employees' wages and social security expenses increased by RMB1,091,831 compared to the same period in 2022. Our cost of revenue decreased by $395,853, or 6.60%, from $5,995,965 for the six months March 31, 2022 to US$5,600,112 for the six months ended March 31, 2023. The decrease in the USD amount of costs in the current period compared to the same period last year was due to the impact of exchange rate changes.

Gross Profit

For the six months ended March 31, 2023, gross profit from sales of in-park recreation increased by approximately RMB7.10 million compared to the same period in 2022, primarily due to increased revenue from higher visitor numbers, as the amusement park largely resumed normal operations during the period in response to the reduced COVID-19 restrictions in China. The decrease in gross profit in USD for the period compared to the same period last year was caused by the impact of exchange rate changes.

The profit margin of sales of in-park recreation remained stable, with a modest increase from 70.35% for the six months ended March 31, 2022 to 71.37% for the six months ended March 31, 2023, as a result of enhanced operations and the relatively stable cost of revenue.

Operating Expenses

Our total operating expenses decreased by $429,590, or 9.63%, from $4,458,645 for the six months ended March 31, 2022 to $4,029,055 for the six months ended March 31, 2023. This decrease was mainly attributable to (i) an increase of approximately $0.59 million in general and administrative expenses, or G&A expenses, and (ii) a decrease of approximately $1.02 million in selling expenses.

The increase of G&A expenses in this period was due to an increase of approximately $0.59 million in consulting fees, mainly consisting of attorney fees, audit fees and brokerage fees in relation to the company's recent IPO (as defined below).

The decrease in selling expenses was attributable to a decrease of approximately US$1.02 million in advertising fees. The company decided to reduce its advertising expenses around March 2022 when the company's financial performance suffered from the ongoing impact of the pandemic.

Other (expense) income, net

Our other expense decreased by $371,698, or 88.67%, from $419,188 for the six months ended March 31, 2022 to US$47,490 for the six months ended March 31, 2023. It was primarily attributable to a decrease in the disposal of property and equipment.

Income tax expense

Our income tax expense increased by $353,020, or 13.49%, from $2,616,317 for the six months ended March 31, 2022 to $2,969,337 for the six months ended March 31, 2023. We are subject to the standard income tax rate of 25% under the PRC tax laws.

Net income

Our net income increased by $148,400, or 2.04%, from $7,266,818 for the six months ended March 31, 2022 to $7,415,218 for the six months ended March 31, 2023, or increased by approximately 12.0% from RMB46,254,030 to RMB51,785,658 for the corresponding period. Such change was the result of the combination of the changes as discussed above.

Cash and Cash Equivalents

As of March 31, 2023, we had cash and cash equivalents of approximately $28.26 million, working capital of approximately negative $16.64 million and total shareholders' equity of approximately $58.80 million, compared to cash and cash equivalents of approximately $22.45 million, working capital of approximately $8.42 million and total shareholders' equity of approximately $49.61 million, respectively, as of September 30, 2022.

Recent Events

On April 14, 2023, the Company closed its initial public offering (the "IPO") of 1,750,000 ordinary shares, par value $0.0001 per share (the "Ordinary Shares"). The Ordinary Shares were priced at $4.00 per share. The Ordinary Shares were previously approved for listing on The Nasdaq Capital Market and commenced trading under the ticker symbol "GDHG" on April 12, 2023.

In connection with the IPO, the Company issued a press release on April 12, 2023, announcing the pricing of the IPO and a press release on April 14, 2023, announcing the closing of the IPO, respectively.

Conference Call Information

The Company's management team will hold a conference call to discuss its financial results at 8:00 A.M. U.S. Eastern Time on August 3, 2023 (8:00 P.M. Beijing Time on August 3, 2023). Details for the conference call are as follows:

Please dial in at least 15 minutes before the commencement of the call to ensure timely participation.

For those unable to participate, an audio replay of the conference call will be available from approximately one hour after the end of the live call until August 10, 2023. The dial-in for the replay is +1-877-344-7529 within the United States or +1-412-317-0088 internationally. The replay access code is No. 5069410. 

A live and archived webcast of the conference call will be available at the Company's investor relations website at https://ir.jsyoule.com/.

About Golden Heaven

The Company is an offshore holding company incorporated in the Cayman Islands with no material operations of its own. Through its Chinese operating entities, the Company manages and operates six properties consisting of amusement parks, water parks and complementary recreational facilities. The parks of the operating entities occupy approximately 426,560 square meters of land in the aggregate and are located in geographically diverse markets across the south of China. Due to the geographical locations of the parks and the ease of travel, the parks are easily accessible to an aggregate population of approximately 21 million people. The parks offer a broad selection of exhilarating and recreational experiences, including both thrilling and family-friendly rides, water attractions, gourmet festivals, circus performances, and high-tech facilities. As of the date of this announcement, the parks collectively contain approximately 139 rides and attractions. For more information, please visit the Company's website at https://ir.jsyoule.com/.

Forward-Looking Statements

All statements other than statements of historical fact in this announcement are forward-looking statements, within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. 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 other factors that may affect its future results in the Company's registration statement and in its other filings with the SEC.

For more information, please contact:

Golden Heaven Group Holdings Ltd.
Email: [email protected]

Ascent Investors Relations LLC
Tina Xiao
Phone: +1-917-609-0333
Email: [email protected]

SOURCE Golden Heaven Group Holdings Ltd.