BGM Group Ltd 20-F/A, filed May 8, 2025
BGM Group Ltd. (BGM)
About this 20-F/A
BGM Group Ltd filed this 20-F/A on May 8, 2025, covering the fiscal year ended September 30, 2024.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
(Amendment No. 3)
OR
For the fiscal year ended
OR
OR
Date of event requiring this shell company report:
For the transition period from _________ to _____________.
Commission file number:
| (Exact name of Registrant as Specified in its Charter) |
| N/A |
(Translation of Registrant’s name into English)
| (Jurisdiction of Incorporation or Organization) |
|
+86-028-64775180 |
| (Address of Principal Executive Offices) |
|
+ Email:
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| (Name, Telephone, E-mail and/or Facsimile Number and Address of Company Contact Person) |
Securities registered or to be registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Securities registered or to be registered pursuant to Section 12(g) of the Act:
None
(Title of Class)
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:
None
(Title of Class)
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.
An aggregate of ordinary shares, consisting of Class A ordinary shares, par value US$0.00833335 per share, and Class B ordinary shares, par value US$0.00833335 per share, as of September 30, 2024.
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ¨
If
this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13
or 15(d) of the Securities Exchange Act of 1934. Yes ¨
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days.
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405
of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
| Large accelerated filer | ¨ | Accelerated filer | ¨ |
| x | Emerging growth company |
If an emerging growth
company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not
to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to
Section 13(a) of the Exchange Act.
Indicate by check
mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal
control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public
accounting firm that prepared or issued its audit report.
If securities are
registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included
in the filing reflect the correction of an error to previously issued financial statements.
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ¨
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
| International Financial Reporting Standards as issued by the International Accounting Standards Board ¨ | Other ¨ |
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow: Item 17 ¨ Item 18 ¨
If
this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act). Yes ¨
Indicate
by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the
Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes
| Auditor Name | Auditor Location | Auditor Firm ID | ||
EXPLANATORY NOTE
BGM Group Ltd (the “Company”) is filing this Amendment No. 3 on Form 20-F/A (this “Amendment No. 3”) to amend its Amendment No. 2 to its annual report on Form 20-F/A for the fiscal year ended December 31, 2024 as filed with the Securities and Exchange Commission (the “SEC”) on April 3, 2025 (the “Amendment No. 2”), to address certain comments from the Staff of the SEC in relation to the Amendment No. 2. Accordingly, the Company is replacing and restating in their entirety the following sections of the Amendment No. 2: (i) “Part I — Item 4. Information on the Company — B. Business Overview — Facilities”; and (ii) “Part I — Item 5. Operating and Financial Reviews and Prospects — A. Operating Results — Results of Operations for the years ended September 30, 2024 and 2023 — Net Revenue — Heparin Products and Sausage Casings.”
Except as specifically noted herein, this Amendment No. 3 does not amend, update or restate any of the information previously included in the Amendment No. 2, the Amendment No.1 on Form 20-F/A (the “Amendment No. 1”) and the Form 20-F originally filed on January 27, 2025 (the “Original Filing”), nor does this Amendment No. 3 reflect any event that has occurred after the filing date of the Amendment No. 2, Amendment No. 1 and the Original Filing. This Amendment No. 3 should be read in conjunction with the Amendment No. 2, Amendment No. 1 and the Original Filing.
In addition, as required by Rule 12b-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), new certifications by the Company’s principal executive officer and principal financial officer are filed herewith as exhibits to this Amendment No. 3 pursuant to Rule 13a-14(a) of the Exchange Act.
PART I
ITEM 4. INFORMATION ON THE COMPANY
B. Business Overview
Facilities
The VIE and its subsidiaries own our premises located at Jiuquan Economic and Technological Development Zone (formerly named No. 2 Dadeli Road, Nanjiao Industrial Park), Jiuquan City, Gansu, China. The VIE and its subsidiaries use the premises not only for corporate and administrative purposes, but also for manufacturing the oxytetracycline products and licorice TCMD products.
The VIE and its subsidiaries also currently own the following land use rights and properties for its operations:
| Area in | ||||||||
| Land Use Right | Square | |||||||
| Holder | Address | Legal Use | Meters | Terms of Use | ||||
| Gansu Qilianshan Pharmaceutical Co., Ltd. | No. 71, Jiujindong Road, Suzhou, Jiuquan, Gansu | Industrial | 40456.33 | Until June 28, 2057 | ||||
| Gansu Qilianshan Pharmaceutical Co., Ltd. | No. 71, Jiujindong Road, Suzhou, Jiuquan, Gansu | Industrial | 29519.37 | June 28, 2057 | ||||
| Gansu Qilianshan Pharmaceutical Co., Ltd. | No.2, Da Deli Road, Industrial Park, Jiuquan, Gansu | Industrial | 30610.14 | Until January 7, 2043 | ||||
| Gansu Qilianshan Pharmaceutical Co., Ltd. | No.2, Da Deli Road, Industrial Park, Jiuquan, Gansu | Industrial | 24464.59 | Until January 7, 2043 | ||||
| Gansu Qilianshan Pharmaceutical Co., Ltd. | No.2, Da Deli Road, Industrial Park, Jiuquan, Gansu | Industrial | 61972.6 | Until January 7, 2043 | ||||
| Chengdu Qilianshan Biotechnology Co., Ltd. | No. 8, Yujian Road, Linqiong Town Industrial Park, Qiong Lai City, Chengdu | Industrial | 14008.00 | Until January 1, 2059 | ||||
| Chongqing Shengfu Biological Technology Co., Ltd. | 102A Zone, 1st Floor, Building 1, East District, Tianjia Town Industrial Park, Tongnan District, Chongqing City | Industrial | 31335.05 | Until February 9, 2073 |
| Property Title | Area in Square | |||||
| Holder | Address | Legal Use | Meters | |||
| Gansu Qilianshan Pharmaceutical Co., Ltd. | No. 71, Jiujin East Road, Suzhou District, Jiuquan City, Gansu | Industrial | 20243.26 | |||
| Gansu Qilianshan Pharmaceutical Co., Ltd. | No. 71, Jiujin East Road, Suzhou District, Jiuquan City, Gansu | Industrial | 11836.27 | |||
| Gansu Qilianshan Pharmaceutical Co., Ltd. | No.2, Da Deli Road, Industrial Park, Jiuquan, Gansu | Industrial | 1669.33 | |||
| Gansu Qilianshan Pharmaceutical Co., Ltd. | No.2, Da Deli Road, Industrial Park, Jiuquan, Gansu | Industrial | 63.44 | |||
| Gansu Qilianshan Pharmaceutical Co., Ltd. | No.2, Da Deli Road, Industrial Park, Jiuquan, Gansu | Industrial | 9845.25 | |||
| Chengdu Qilianshan Biotechnology Co.,Ltd. | No. 8, Yujian Road, Linqiong Town Industrial Park, Qiong Lai City, Chengdu(1) | Industrial | 1082.84 | |||
| Chengdu Qilianshan Biotechnology Co., Ltd. | No. 8, Yujian Road, Linqiong Town Industrial Park, Qiong Lai City, Chengdu(1) | Industrial | 664.08 | |||
| Chengdu Qilianshan Biotechnology Co., Ltd. | No. 8, Yujian Road, Linqiong Town Industrial Park, Qiong Lai City, Chengdu(1) | Industrial | 168.34 | |||
| Chengdu Qilianshan Biotechnology Co., Ltd. | No. 8, Yujian Road, Linqiong Town Industrial Park, Qiong Lai City, Chengdu(1) | Industrial | 738.09 | |||
| Chengdu Qilianshan Biotechnology Co., Ltd. | No. 8, Yujian Road, Linqiong Town Industrial Park, Qiong Lai City, Chengdu(1) | Industrial | 40.77 | |||
| Chengdu Qilianshan Biotechnology Co., Ltd. | No. 8, Yujian Road, Linqiong Town Industrial Park, Qiong Lai City, Chengdu(1) | Industrial | 1130.03 | |||
| Chongqing Shengfu Biological Technology Co., Ltd. | 102A Zone, 1st Floor, Building 1, East District, Tianjia Town Industrial Park, Tongnan District, Chongqing City(2) | Industrial | 5953.76 | |||
| Chongqing Shengfu Biological Technology Co., Ltd. | 102A Zone, 1st Floor, Building 1, East District, Tianjia Town Industrial Park, Tongnan District, Chongqing City(2) | Industrial | 1701.40 | |||
|
Chongqing Shengfu Biological Technology Co., Ltd. |
102A Zone, 1st Floor, Building 1, East District, Tianjia Town Industrial Park, Tongnan District, Chongqing City(2) | Industrial | 9787.24 |
| (1) | Chengdu Qilianshan Biotechnology Co., Ltd. obtained its current property from judicial auctions. It has yet to receive a property ownership certificate for this property. Chengdu Qilianshan Biotechnology Co., Ltd. can still legally use this property even without a property ownership certificate. |
| (2) | Chongqing Shengfu Biological Technology Co., Ltd. obtained the land use right certificate, but it has yet to receive a property ownership certificate for this property. Chongqing Shengfu Biological Technology Co., Ltd. can still legally use this property even without a property ownership certificate. |
In addition, as of September 30, 2024, the WFOE and the VIE and its subsidiaries leased two properties as employee housing with a total area of approximately 226 square meters, all of which are in Sichuan Province. As of September 30, 2024, we had leased employee dormitories with a total area of approximately 226 square meters, all of which are in Sichuan Province. As of September 30, 2024, Chengdu QLS leases a production facility from a third-party lessor with an aggregate area of approximately 6,000 square meters for an annual rent of RMB200,000 (US$30,969), which Chengdu QLS sublet to Rugao for an annual rent of RMB200,000 (US$30,969). We believe that our, the VIE and its subsidiaries’ current facilities are adequate and suitable for their operations, but we or our affiliated entities may seek additional space as needed to accommodate future growth.
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
| A. | Operating Results |
Results of Operations for the years ended September 30, 2024 and 2023
Net Revenue
Heparin Products and Sausage Casings
Sales from heparin products and sausage casing decreased by $13.1 million, or 85%, from $15.3 million for the year ended September 30, 2023, to $2.2 million for the year ended September 30, 2024. The decrease of $10 million in sales of heparin products is mainly due to four reasons: 1) Our country issued a centralized procurement policy for heparin products in hospitals, and the procurement price decreased by 50-70% compared to before. This news has reduced the purchasing volume of heparin products for customers in February 2023; 2) At the same time, the price of heparin products has also entered a downward trend, with the sales unit price dropping from 48,000 yuan in April 2023 to 12,000 yuan in December 2023, and now reaching 15,800 yuan; 3) The customer had a relatively large inventory of heparin products purchased in the early stage, and in order to reduce losses, the customer had to digest the inventory. Therefore, the decrease in customer procurement was the main reason for the Company’s sales decline; and 4) The Company went from a profitable state to a loss state, with more production resulting in greater losses.
Therefore, the Company shut down the production factory of Chengdu Qilianshan Biotechnology Co., Ltd., which occupied 78% of the Company’s total Heparin products to reduce losses. Chengdu Qilianshan Biotechnology Co., Ltd. has been shut down since September 2023, only entrusted for processing. The sales of sausage casing decreased by $2 million mainly due to the impact of the national centralized procurement policy, resulting in a decrease in the Company’s production.
In 2020, the Qionglai Municipal Government proposed a new urban planning project to establish the “Qionglai Green Food Industrial Functional Zone” and the production area of Chengdu Qilianshan Biotechnology Co., Ltd. was situated within the urban renewal area of this project. Thus, the management committee of Qionglai Green Food Industrial Functional Zone has requested the Company to relocate. To ensure the sustainable development of our business and upon conducting thorough research and due diligence, the Company decided to move its production facility to Chongqing. This specific location was chosen with the purpose to reduce production costs, improve operational efficiency, and leverage the geographical and resource advantages of the raw materials supply of pig small intestine, as well as attaining the benefits from the tax incentives offered to high-tech enterprises in the Chongqing High-Tech Zone.
Chongqing Shengfu Biological Technology Co., Ltd. initiated trial production in October 2024 and is currently under regular production operations, which coincides with the emerging recovery of the heparin industry.
PART III
ITEM 19. EXHIBITS
| * | Filed herewith. |
| ** | Furnished herewith. |
SIGNATURES
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F/A and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.
| BGM Group Ltd | ||
| By: | /s/ Chen Xin | |
| Name: | Chen Xin | |
| Title: |
Chief Executive Officer (Principal Executive Officer) | |
| Date: May 8, 2025 | ||
Exhibit 12.1
Certification by the Principal Executive Officer pursuant to Securities Exchange Act Rules 13a-14(a) and
15d-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Chen Xin, certify that:
| 1. | I have reviewed this annual report on Form 20-F, as amended by Amendment No. 3 thereto, of BGM Group Ltd; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; |
| 4. | The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| c. | Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and |
| 5. | The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting. |
| Date: | May 8, 2025 | |
| /s/ Chen Xin | ||
| Name: | Chen Xin | |
| Title: | Chief Executive Officer | |
| (Principal Executive Officer) |
Exhibit 12.2
Certification by the Principal Financial Officer pursuant to Securities Exchange Act Rules 13a-14(a) and 15d-
14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
I, Yaxuan Zhai, certify that:
| 1. | I have reviewed this annual report on Form 20-F, as amended by Amendment No. 3 thereto, of BGM Group Ltd; |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; |
| 4. | The company’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
| c. | Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and |
| 5. | The company’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting. |
| Date: | May 8, 2025 | |
| /s/ Yaxuan Zhai | ||
| Name: | Yaxuan Zhai | |
| Title: | Chief Financial Officer | |
| (Principal Financial Officer and Principal Accounting Officer) |
Exhibit 13.1
Certification by the Principal Executive Officer
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Pursuant to U.S.C. Section 1350 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), I, Chen Xin, Chief Executive Officer of BGM Group Ltd (the “Company”), hereby certify to my knowledge that:
The Annual Report on Form 20-F for the year ended September 30, 2024, as amended by Amendment No. 3 thereto, of the Company fully complies, in all material respects, with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 20-F fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: May 8, 2025
| /s/ Chen Xin | |
| Chen Xin | |
| Chief Executive Officer | |
| (Principal Executive Officer) |
Exhibit 13.2
Certification by the Principal Financial Officer
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
Pursuant to U.S.C. Section 1350 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), I, Yaxuan Zhai, Chief Financial Officer of BGM Group Ltd (the “Company”), hereby certify to my knowledge that:
The Annual Report on Form 20-F for the year ended September 30, 2024, as amended by Amendment No. 3 thereto, of the Company fully complies, in all material respects, with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 20-F fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: May 8, 2025
| /s/ Yaxuan Zhai | |
| Yaxuan Zhai | |
| Chief Financial Officer | |
| (Principal Financial Officer and Principal Accounting Officer) |