SLGB 6-K
Smart Logistics Global Ltd (SLGB)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of December 2025
Commission File Number: 001-42454
SMART LOGISTICS GLOBAL LIMITED
(Registrant’s Name)
Unit 702, Level 7, Core B, Cyberport 3
100 Cyberport Road
Pokfulam, Hong Kong 999077
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
EXPLANATORY NOTE
Smart Logistics Global Limited (the “Company”) is filing this Report on Form 6-K to report its financial results for the six months ended June 30, 2025 and to discuss its recent corporate developments.
On December 19, 2025, the Company issued a press release announcing its results of operations for the six months ended June 30, 2025, attached hereto as Exhibits 99.3.
Attached as exhibits to this Report on Form 6-K are:
| (1) | The unaudited condensed interim consolidated financial statements and related notes as Exhibit 99.1; |
| (2) | Management’s Discussion and Analysis of Financial Condition and Results of Operations as Exhibit 99.2; and |
| (3) | Press release dated December 19, 2025 as Exhibit 99.3. |
1
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Statements in this current report with respect to the Company’s current plans, estimates, strategies and beliefs and other statements that are not historical facts are forward-looking statements about the future performance of the Company. Forward-looking statements include, but are not limited to, those statements using words such as “believe,” “expect,” “plans,” “strategy,” “prospects,” “forecast,” “estimate,” “project,” “anticipate,” “aim,” “intend,” “seek,” “may,” “might,” “could” or “should,” and words of similar meaning in connection with a discussion of future operations, financial performance, events or conditions. From time to time, oral or written forward-looking statements may also be included in other materials released to the public. These statements are based on management’s assumptions, judgments and beliefs in light of the information currently available to it. The Company cautions investors that a number of important risks and uncertainties could cause actual results to differ materially from those discussed in the forward-looking statements, including but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in reports filed by the Company with the Securities and Exchange Commission. Therefore, investors should not place undue reliance on such forward-looking statements. Actual results may differ significantly from those set forth in the forward-looking statements.
All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.
2
Financial Statements and Exhibits.
The following exhibits are being filed herewith:
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| Smart Logistics Global Limited | ||
| Date: December 19, 2025 | By: | /s/ Hue Kwok Chiu |
| Name: | Hue Kwok Chiu | |
| Title: | Chief Executive Officer | |
4
Exhibit 99.1
INDEX TO FINANCIAL STATEMENTS
SMART LOGISTICS GLOBAL LIMITED
Unaudited Condensed Combined and Consolidated Financial Statements
F-1
Smart Logistics Global Limited
Unaudited Condensed Consolidated Balance Sheets
As of December 31, 2024 and June 30, 2025
| As of | ||||||||||||
| December 31, 2024 | June 30, 2025 | June 30, 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| ASSETS | ||||||||||||
| Current Assets | ||||||||||||
| Cash | 10,522,943 | 3,277,379 | 457,504 | |||||||||
| Accounts receivable, net | 15,742,983 | 16,367,372 | 2,284,797 | |||||||||
| Contract assets | 63,584,323 | 48,728,479 | 6,802,233 | |||||||||
| Inventories | 334,937 | 332,633 | 46,434 | |||||||||
| Prepayments and other current assets | 7,065,310 | 29,588,683 | 4,130,421 | |||||||||
| Total current assets | 97,250,496 | 98,294,546 | 13,721,389 | |||||||||
| Non-Current Assets | ||||||||||||
| Property, equipment and software, net | 39,795,125 | 39,190,918 | 5,470,841 | |||||||||
| Land use right, net | 8,271,298 | 8,175,676 | 1,141,280 | |||||||||
| Other non-current assets | 29,535,390 | 30,330,169 | 4,233,928 | |||||||||
| Operating lease right-of-use assets, net | 392,243 | 96,523 | 13,474 | |||||||||
| Total non-current assets | 77,994,056 | 77,793,286 | 10,859,523 | |||||||||
| Total assets | 175,244,552 | 176,087,832 | 24,580,912 | |||||||||
| LIABILITIES AND SHAREHOLDER’ S EQUITY | ||||||||||||
| Current Liabilities | ||||||||||||
| Accounts payable | 9,607,647 | 1,541,081 | 215,127 | |||||||||
| Accrued expenses and other current liabilities | 9,933,441 | 11,205,693 | 1,564,253 | |||||||||
| Advances from customers | 236,821 | 557,741 | 77,858 | |||||||||
| Short-term bank loans | 31,000,000 | 31,000,000 | 4,327,433 | |||||||||
| Due to controlling shareholder | 1,290,837 | 4,983,711 | 695,699 | |||||||||
| Dividend payable | 59,800 | 58,073 | 8,107 | |||||||||
| Income tax payables | 2,667,477 | 1,365,801 | 190,658 | |||||||||
| Operating lease liabilities, current | 367,798 | 90,412 | 12,621 | |||||||||
| Total current liabilities | 55,163,821 | 50,802,512 | 7,091,756 | |||||||||
| Non-Current Liabilities | ||||||||||||
| Deferred tax liability, net | 3,174,130 | 2,791,999 | 389,748 | |||||||||
| Other non-current liability | 5,840,000 | 5,840,000 | 815,233 | |||||||||
| Total non-current liabilities | 9,014,130 | 8,631,999 | 1,204,981 | |||||||||
| Total liabilities | 64, 177,951 | 59,434,511 | 8,296,737 | |||||||||
Commitments and contingencies (Note 16) | ||||||||||||
| SHAREHOLDER’S EQUITY | ||||||||||||
| Ordinary shares, 156,000,000,000 shares authorized with par value HK$0.0001 each, 40,000,000 share issued and outstanding as of June 30, 2024 and 2025 | 3,633 | 3,633 | 507 | |||||||||
| Subscription receivable | (3,633 | ) | (3,633 | ) | (507 | ) | ||||||
| Additional paid-in capital | 4,564,967 | 4,564,967 | 637,245 | |||||||||
| Accumulated other comprehensive income | (12,141,002 | ) | (12,383,778 | ) | (1,728,709 | ) | ||||||
| Statutory reserves | 23,853,066 | 24,860,883 | 3,470,445 | |||||||||
| Retained earnings | 94,789,570 | 99,611,249 | 13,905,194 | |||||||||
| Total shareholder’s equity | 111,066,601 | 116,653,321 | 16,284,175 | |||||||||
| Total liabilities and shareholder’s equity | 175,244,552 | 176,087,832 | 24,580,912 | |||||||||
The accompanying notes are an integral part of these unaudited condensed combined and consolidated financial statements.
F-2
Smart Logistics Global Limited
Unaudited Condensed Combined and Consolidated Statements of Income and Comprehensive Income
For the Six Months Ended June 30, 2024 and 2025
| For the six months ended June 30, | ||||||||||||
| 2024 | 2025 | 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| REVENUE | 298,661,805 | 332,805,659 | 46,457,879 | |||||||||
| COSTS AND EXPENSES | ||||||||||||
| Costs of revenue | 289,262,630 | 315,081,124 | 43,983,629 | |||||||||
| Selling and marketing expenses | 2,560,329 | 2,281,321 | 318,460 | |||||||||
| General and administrative expenses | 6,180,899 | 6,687,373 | 933,520 | |||||||||
| Total costs and expenses | 298,003,858 | 324,049,818 | 45,235,609 | |||||||||
| INCOME FROM OPERATIONS | 657,947 | 8,755,841 | 1,222,270 | |||||||||
| OTHER INCOMES | ||||||||||||
| Foreign exchange gain | — | 6,247 | 872 | |||||||||
| Other incomes (expenses), net | 8,557 | (29,778 | ) | (4,157 | ) | |||||||
| Interest incomes (expenses), net | 1,928,062 | (581,615 | ) | (81,190 | ) | |||||||
| Total other incomes (expenses), net | 1,936,619 | (605,146 | ) | (84,475 | ) | |||||||
| INCOME BEFORE INCOME TAXES | 2,594,566 | 8,150,695 | 1,137,795 | |||||||||
| Income tax expense | (1,318,621 | ) | (2,321,199 | ) | (324,027 | ) | ||||||
| NET INCOME | 1,275,945 | 5,829,496 | 813,768 | |||||||||
| OTHER COMPREHENSIVE INCOME | ||||||||||||
| Foreign currency translation adjustments | (2,501,035 | ) | (242,776 | ) | (33,890 | ) | ||||||
| COMPREHENSIVE (LOSS) INCOME | (1,225,090 | ) | 5,586,720 | 779,878 | ||||||||
| Earnings per share: | ||||||||||||
| Basic and diluted | 0.03 | 0.15 | 0.02 | |||||||||
| Weighted average number of ordinary shares outstanding: | ||||||||||||
| Ordinary shares – Basic and diluted* | 40,000,000 | 40,000,000 | 40,000,000 | |||||||||
The accompanying notes are an integral part of these unaudited condensed combined and consolidated financial statements.
F-3
Smart Logistics Global Limited
Unaudited Condensed Combined and Consolidated Statements of Changes in Shareholder’s Equity
For the Six Months Ended June 30, 2024 and 2025
| For the six months ended June 30, 2024 | ||||||||||||||||||||||||||||||||
| Ordinary shares | Additional | Accumulated other | ||||||||||||||||||||||||||||||
| Number issued | Amount | Subscription receivable | paid-in capital | Retained earnings | Statutory reserves | comprehensive income | Total | |||||||||||||||||||||||||
| RMB | RMB | RMB | RMB | RMB | RMB | RMB | ||||||||||||||||||||||||||
| Balance as of December 31, 2023 | 40,000,000 | 3,633 | (3,633 | ) | 4,564,967 | 137,963,073 | 17,040,428 | (6,835,607 | ) | 152,732,861 | ||||||||||||||||||||||
| Net income | — | — | — | — | 1,275,945 | — | — | 1,275,945 | ||||||||||||||||||||||||
| Statutory reserves | — | — | — | — | (401,375 | ) | 401,375 | — | — | |||||||||||||||||||||||
| Foreign currency translation adjustments | — | — | — | — | — | — | (2,501,035 | ) | (2,501,035 | ) | ||||||||||||||||||||||
| Balance as of June 30, 2024 | 40,000,000 | 3,633 | (3,633 | ) | 4,564,967 | 138,837,643 | 17,441,803 | (9,336,642 | ) | 151,507,771 | ||||||||||||||||||||||
| For the six months ended June 30, 2025 | ||||||||||||||||||||||||||||||||
| Ordinary shares | Additional | Accumulated other | ||||||||||||||||||||||||||||||
| Number issued | Amount | Subscription receivable | paid-in capital | Retained earnings | Statutory reserves | comprehensive income | Total | |||||||||||||||||||||||||
| RMB | RMB | RMB | RMB | RMB | RMB | RMB | ||||||||||||||||||||||||||
| Balance as of December 31, 2024 | 40,000,000 | 3,633 | (3,633 | ) | 4,564,967 | 94,789,570 | 23,853,066 | (12,141,002 | ) | 111,066,601 | ||||||||||||||||||||||
| Net income | — | — | — | — | 5,829,496 | — | — | 5,829,496 | ||||||||||||||||||||||||
| Statutory reserves | — | — | — | — | (1,007,817 | ) | 1,007,817 | — | — | |||||||||||||||||||||||
| Foreign currency translation adjustments | — | — | — | — | — | — | (242,776 | ) | (242,776 | ) | ||||||||||||||||||||||
| Balance as of June 30, 2025 | 40,000,000 | 3,633 | (3,633 | ) | 4,564,967 | 99,611,249 | 24,860,883 | (12,383,778 | ) | 116,653,321 | ||||||||||||||||||||||
| US$ | US$ | US$ | US$ | US$ | US$ | US$ | ||||||||||||||||||||||||||
| Balance as of June 30, 2025 | 40,000,000 | 507 | (507 | ) | 637,245 | 13,905,194 | 3,470,445 | (1,728,709 | ) | 16,284,175 | ||||||||||||||||||||||
The accompanying notes are an integral part of these unaudited condensed combined and consolidated financial statements.
F-4
Smart Logistics Global Limited
Unaudited Condensed Combined and Consolidated Statements of Cash Flows
For the Six Months Ended June 30, 2024 and 2025
| For the Six Months Ended June 30, | ||||||||||||
| 2024 | 2025 | 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Cash flows from/(for) operating activities: | ||||||||||||
| Net income | 1,275,945 | 5,829,496 | 813,768 | |||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
| Depreciation and amortization of property, equipment and software | 879,121 | 822,290 | 114,787 | |||||||||
| Loss on disposal | — | 235 | 33 | |||||||||
| Amortization of land use right | 95,622 | 95,622 | 13,348 | |||||||||
| Amortization of right-of-use assets | 332,165 | 290,373 | 40,535 | |||||||||
| Deferred income tax | (122,778 | ) | (382,131 | ) | (53,343 | ) | ||||||
| Foreign exchange gain | 33,206 | — | — | |||||||||
| Change in operating assets and liabilities: | ||||||||||||
| Inventories | 64,416 | 2,304 | 322 | |||||||||
| Accounts receivable | (2,763,941 | ) | (624,389 | ) | (87,161 | ) | ||||||
| Prepaid expenses and other current assets | 789,611 | (22,523,373 | ) | (3,144,142 | ) | |||||||
| Interest receivable | 2,472,447 | — | — | |||||||||
| Other non-current assets | (30,000 | ) | 574,479 | 80,194 | ||||||||
| Contract assets | 15,466,650 | 14,855,844 | 2,073,796 | |||||||||
| Advances from customers | 5,508 | 320,921 | 44,799 | |||||||||
| Accounts payable | (9,964,727 | ) | (8,066,566 | ) | (1,126,049 | ) | ||||||
| Accrued expenses and other current liabilities | (394,605 | ) | 1,272,251 | 177,596 | ||||||||
| Lease liabilities | (312,163 | ) | (277,386 | ) | (38,722 | ) | ||||||
| Other non-current liabilities | 30,000 | — | — | |||||||||
| Income tax payable | 678,878 | (1,301,676 | ) | (181,707 | ) | |||||||
| Net cash provided by (used in) operating activities | 8,535,355 | (9,111,706 | ) | (1,271,946 | ) | |||||||
| Cash flows for investing activities: | ||||||||||||
| Purchase of property, equipment and software | (129,874 | ) | (235,282 | ) | (32,844 | ) | ||||||
| Repayment from loans provided to third-party suppliers | 7,650,995 | — | — | |||||||||
| Loans provided to third-party suppliers | (25,000,000 | ) | — | — | ||||||||
| Net cash used in investing activities | (17,478,879 | ) | (235,282 | ) | (32,844 | ) | ||||||
| Cash flows from financing activities: | ||||||||||||
| Loan received from the bank | 21,000,000 | 21,000,000 | 2,931,487 | |||||||||
| Repayment of bank loan | (13,000,000 | ) | (21,000,000 | ) | (2,931,487 | ) | ||||||
| Amount received from due to the controlling shareholder | 4,554,492 | 3,733,955 | 521,240 | |||||||||
| Amount repaid to the controlling shareholder | (1,258,351 | ) | — | — | ||||||||
| Repayment of long-term loan to a third-party customer | (1,596,691 | ) | — | — | ||||||||
| Payment of deferred issuance cost | — | (1,369,258 | ) | (191,141 | ) | |||||||
| Net cash provided by financing activities | 9,699,450 | 2,364,697 | 330,099 | |||||||||
| Effect of exchange rate changes | (114,353 | ) | (263,273 | ) | (36,751 | ) | ||||||
| Net increase (decrease) in cash | 641,573 | (7,245,564 | ) | (1,011,442 | ) | |||||||
| Cash, beginning of period | 13,700,510 | 10,522,943 | 1,468,946 | |||||||||
| Cash, end of period | 14,342,083 | 3,277,379 | 457,504 | |||||||||
| Supplemental non-cash information: | ||||||||||||
| Settlement of the balance due from and due to the controlling shareholder | 123,270,408 | — | — | |||||||||
| Supplemental disclosures of cash flow information: | ||||||||||||
| Income tax paid | 762,522 | 4,005,006 | 559,077 | |||||||||
| Interest paid | 521,336 | 585,225 | 81,694 | |||||||||
The accompanying notes are an integral part of these unaudited condensed combined and consolidated financial statements.
F-5
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
1. Organization and Description of Business
Smart Logistics Global Limited (“SLG Cayman” or the “Company”) is a company incorporated in the Cayman Islands with limited liability on October 8, 2020. SLG Cayman is 100% owned by ASL Ventures Limited, a company incorporated in the British Virgin Islands (“BVI”) which is owned by the sole shareholder, Mr. Hue, Kwok Chiu.
Amelia Global Limited (“Amelia”), a wholly-owned subsidiary of SLG Cayman, is a company incorporated in the British Virgin Islands with limited liability on January 8, 2021. Amelia has no substantial operations other than holding all of the outstanding share capital of Jiabin Logistics Network Limited (“Jiabin HK”), which is a company incorporated in Hong Kong with limited liability on May 10, 2017.
Jiabin HK is an investment holding company with no operations and established its wholly-owned subsidiary, Jiangxi Jiabin Logistics Network Co., Limited (“Jiangxi JB”), a company incorporated in the People’s Republic of China (“PRC”). Jiangxi JB established two wholly-owned subsidiaries in PRC, Fuzhou Jiabin Modern Logistics Park Limited (“Fuzhou JB”) and Fuzhou Feiyi Automobile Service Co., Limited (“Fuzhou Feiyi”), on July 26, 2017 and October 22, 2020, respectively.
SLG Cayman together with its subsidiaries (collectively, the “Group”) is primarily engaged in providing industrial raw materials line-haul transportation services to a wide range of customers in PRC.
F-6
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies
Basis of presentation and principle of consolidation
The accompanying unaudited condensed combined and consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and applicable rules and regulations of the Securities and Exchange Commission. Operating results for the six months ended June 30, 2024 and 2025 are not necessary indicative of the results that may be expected for the full year. These unaudited condensed combined and consolidated financial statements should be read in conjunction with the Group’s audited combined and consolidated financial statements and the notes thereto as of and for the year ended December 31, 2024.
The accompanying unaudited condensed combined and consolidated financial statements reflect the activities of SLG Cayman and the following entities:
|
Subsidiaries |
Date of Incorporation |
Jurisdiction of Formation |
Percentage of direct/indirect Economic Ownership |
Principal Activities | |||||
| Amelia Global Limited (“Amelia”) | January 8, 2021 | BVI | 100% | Investment holding | |||||
| Jiabin Logistics Network Limited (“Jiabin HK”) | May 10, 2017 | Hong Kong | 100% | Investment holding | |||||
| Jiangxi Jiabin Logistics Network Co., Limited (“Jiangxi JB”) | July 25, 2017 | PRC | 100% | Investment holding | |||||
| Fuzhou Jiabin Modern Logistics Park Co., Limited (“Fuzhou JB”) | July 26, 2017 | PRC | 100% | Industrial raw materials line-haul transportation services | |||||
| Fuzhou Feiyi Automobile Service Co., Limited (“Fuzhou Feiyi”) | October 22, 2020 | PRC | 100% | Vehicle repair and maintenance services |
F-7
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies (cont.)
Emerging Growth Company
The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to optout is irrevocable. The Group has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Group, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Group’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
Use of estimates and assumptions
The preparation of unaudited condensed combined and consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates and judgments are based on historical information, information that is currently available to the Group and on various other assumptions that the Group believes to be reasonable under the circumstances. The accounting estimates required to be made by management include, but not limited to, allowance for expected credit losses of receivables, determination of the useful lives of long-lived assets, impairment of long-lived assets, operating lease right-of-use assets, and operating lease liabilities. Actual results could differ from the estimates, and as such, differences could be material to the unaudited condensed combined and consolidated financial statements.
Cash
Cash comprises of cash at banks. The Group considers all highly liquid investments purchased and cash deposits with financial institutions with original maturities of three months or less to be cash equivalents.
Inventories
Inventories primarily comprise tires and spare parts. Inventories are measured at the lower of cost or net realizable value under the first-in, first-out method.
F-8
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies (cont.)
Accounts receivable and allowance for expected credit losses of receivables
In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments—Credit Losses (Topic 326), which replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to estimate credit losses. The Group’s adoption of ASU 2016-13 on January 1, 2023 did not have a material impact on the unaudited condensed combined and consolidated financial statements and disclosures.
Accounts receivables are stated and carried at original invoiced amount less an allowance for credit losses. Accounts are considered overdue after 90 days. In establishing the required allowance for credit losses, management considers historical collection experience, aging of the receivables, and the credit history and financial conditions of the customers. Management also considers external factors, including current and forecasts of economic conditions, and industry trends. Management reviews its receivables on a regular basis to determine if the credit loss allowance is adequate and adjusts the allowance when necessary. Delinquent account balances are written-off against allowance for credit losses of receivables after all means of collection have been exhausted and that the likelihood of collection is not probable.
Deferred offering costs
Deferred direct offering costs were capitalized and consisted of fees and professional expenses incurred and directly attributable to the sale of the Company’s common stock in the Initial Public Offering (“IPO”), including the legal, printing and other offering related costs. The deferred offering costs will be charged to shareholder’s equity upon the completion of the proposed IPO. If the proposed IPO proves to be unsuccessful, these deferred offering costs, as well as additional expenses incurred, will be charged to operations.
Prepayments
Prepayments are advanced to suppliers for future services or purchases to be rendered or completed. For any advances to suppliers that management determines will not be converted into purchases or be refunded, the Group will recognize an allowance for such balances. Management reviews its advances to suppliers on a regular basis to determine if the allowance is adequate and adjusts the allowance when necessary. As of December 31, 2024 and June 30, 2025, no allowance for the credit losses were deemed necessary for prepayments.
F-9
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies (cont.)
Other current assets
Other current assets primarily include estimated value-added-tax deductible in the future, and other receivables which consisted of rental deposits and security deposits. Management reviews the pools of other receivables and changes in payment trends and records allowances when management believes the collection of amounts due is at risk. Accounts considered uncollectable are written off against allowances after exhaustive efforts at collection are made. As of December 31, 2024 and June 30, 2025, no allowance for the credit losses were deemed necessary for other receivables.
Leases
The Group is a lessee of non-cancellable operating leases. The Group determines if an arrangement is a lease at inception. A lease for which substantially all the benefits and risks incidental to ownership remain with the lessor is classified by the lessee as an operating lease. All leases of the Group are currently classified as operating leases. The Group accounts operating lease under FASB Accounting Standards Codification (“ASC”) 842, Leases, and recognizes operating lease right-of-use (“ROU”) assets, and operating lease liabilities on the balance sheets for its operating leases accordingly.
ROU assets represent the Group’s right to use an underlying asset for the lease term and operating lease liabilities represent its obligation to make lease payments arising from the lease. ROU assets and operating lease liabilities are recognized at lease commencement date based on the present value of lease payments over the lease term.
When determining the lease term, at lease commencement date, the Group considers options to extend or terminate the lease when it is reasonably certain that it will exercise or not exercise that option. The interest rate used to determine the present value of future lease payments is the Group’s incremental borrowing rate based on the information available at the lease commencement date.
The lease standard (ACS 842) provides practical expedients for an entity’s ongoing accounting. The Group elected to apply the short-term lease exception for leases with a lease term of 12 months or less at commencement. Accordingly, ROU assets and operating lease liabilities do not include leases with a lease term of 12 months or less.
The Group evaluates the impairment of its ROU assets consistently with the approach applied for its other long-lived assets. The Group reviews the recoverability of its long-lived assets when events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. The assessment of possible impairment is based on its ability to recover the carrying value of the assets from the expected undiscounted future cash flows of the related operations. As of December 31, 2024 and June 30, 2025, the Group did not recognize any impairment loss against its ROU assets.
F-10
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies (cont.)
Property, equipment and software, net
Property, equipment and software are stated at cost less accumulated depreciation or accumulated amortization, and impairment losses, if applicable. Depreciation and amortization are provided over the estimated useful lives of the assets using the straight-line method from the time the assets are placed in service, after considering the estimated residual value which is 5% of costs. The estimated useful lives of property, equipment and software are as follows:
| Building | 20 years | |
| Leasehold improvements | Shorter of remaining lease term or useful life | |
| Computer equipment | 3 years | |
| Office equipment | 5 years | |
| Transportation equipment | 5 years | |
| Licensed software | 3 to 10 years |
Expenditures for repairs and maintenance, which do not materially extend the useful lives of the assets, are expensed as incurred. Expenditures for major renewals and betterments which substantially extend the useful life of assets are capitalized. The cost and related accumulated depreciation of assets disposed of or retired are removed from the accounts, and any resulting gain or loss is reflected in the unaudited condensed combined and consolidated statements of income and comprehensive income under other income or expenses.
Construction-in-progress is stated at cost, which relates to construction cost of our office building. No depreciation expense is recorded on construction-in-progress until such time as the relevant assets are completed and put into use.
Land use right, net
Land use right, net, represents amounts paid for the right to use land in the PRC and is recorded at cost less accumulated amortization. Amortization is provided on a straight-line basis over the terms of the agreement, which is 50 years.
Land in the PRC is owned by the PRC government. The government in the PRC, according to PRC Law, may sell the right to use the land for a specific period of time. Thus, all of the Group’s land purchases in the PRC are considered to be leasehold land and are classified as land use rights.
Impairment of long-lived assets
The Group reviews long-lived assets, including property, equipment and software, ROU assets and land use right, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the undiscounted future cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Fair value is generally determined by discounting the cash flows expected to be generated by the asset (asset group), when the market prices are not readily available. The adjusted carrying amount of the asset is the new cost basis and is depreciated over the asset’s remaining useful life. Long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. As of December 31, 2024 and June 30, 2025, no impairment of long-lived assets were recognized.
F-11
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies (cont.)
Revenue recognition
The Group follows the rules and guidance set out under ASC 606, Revenue from Contracts with Customers (“ASC 606”) for revenue recognition. The core principle of ASC 606 requires an entity to recognize revenues to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. In according with ASC 606, revenues are recognized when the Group satisfies the performance obligations by delivering the promised services to the customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those services. The following five steps are applied to achieve that core principle:
Step 1: Identify the contract with the customer
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the performance obligations in the contract
Step 5: Recognize revenue when the company satisfies a performance obligation.
The Group generates revenues mainly from providing transportation services. The following table identifies the disaggregation of the Group’s revenue for the six months ended June 30, 2024 and June 30, 2025, respectively:
| For the Six Months Ended June 30, | ||||||||||||
| Revenue Categories | 2024 | 2025 | 2025 | |||||||||
| RMB | RMB | US$ | ||||||||||
| Transportation services | ||||||||||||
| Paper | 165,080,865 | 152,961,843 | 21,352,650 | |||||||||
| Steel | 20,023,390 | 28,157,677 | 3,930,660 | |||||||||
| Coal | 52,067,267 | 58,100,750 | 8,110,552 | |||||||||
| Food and others | 61,490,283 | 93,585,389 | 13,064,017 | |||||||||
| Total | 298,661,805 | 332,805,659 | 46,457,879 | |||||||||
The following table presents revenue classified by timing of revenue recognition for the six months ended June 30, 2024 and June 30, 2025, respectively.
| For the Six Months Ended June 30, | ||||||||||||
| Revenue Categories | 2024 | 2025 | 2025 | |||||||||
| RMB | RMB | US$ | ||||||||||
| Point in time | 4,484 | 2,218 | 310 | |||||||||
| Over time | 298,657,321 | 332,803,441 | 46,457,569 | |||||||||
| Total | 298,661,805 | 332,805,659 | 46,457,879 | |||||||||
Transportation services
The Group derives its transportation service revenue by providing transportation services based on customers’ orders. The performance obligation specified in customer orders is to transport customer’s goods on a shipment-by-shipment basis. The transaction price is predetermined mainly according to the distance of the transportation as well as the volume of the goods. The transportation revenue is recognized over time, which generally represents the transit period from origin to a destination by a trucker. The transit period can vary based on origin and destination, but usually can be fulfilled within one day to three days. Contracts still in transit at period end are not material. Generally, the credit term is within three months. There is no other obligation in our contracts, such as return, refund or warranties.
Fuzhou Feiyi also provides vehicle repair and maintenance services and sales of tires or spare parts to its customers and recognizes revenue at point in time as the Group completes the services or control transferred to the customers. These revenues were less than 1% and insignificant and were not separately presented in the unaudited condensed combined and consolidated statements of income.
F-12
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies (cont.)
Principal and Agent Considerations
In the Group’s transportation business, the Group utilizes independent contractors and third-party carriers in the performances of transportation services as and when needed. GAAP requires us to evaluate, using a control model, whether the Group itself promises to provide services to the customers (as a principal) or to arrange for services to be provided by another party (as an agent). Based on the Group’s evaluation using a control model, the Group determined that in all of its major business activities, it serves as a principal rather than an agent within their revenue arrangements. Revenue and the associated purchased transportation costs are both reported on a gross basis within the unaudited condensed combined and consolidated statements of income and comprehensive income.
Contract assets
A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If a company performs by transferring goods or services to a customer before the customer pays consideration or before a payment is due, a contract asset is recognized for the earned consideration that is unbilled. Contract assets are subject to impairment assessment.
The Group generally bills their customers in the following months. The Group’s contract assets contain earned but unbilled revenue associated with contract work that has been completed but not paid by customers, that are generally due once the transportation services are confirmed by both parties and VAT invoice is issued. As of December 31, 2024 and June 30, 2025 the balance of contract assets was RMB63,584,323 and RMB48,728,479, respectively.
| As of, | ||||||||||||
| Contract Assets | December 31, 2024 | June 30, 2025 | June 30, 2025 | |||||||||
| RMB | RMB | US$ | ||||||||||
| Balance at beginning of the year/period | 67,565,629 | 63,584,323 | 8,876,029 | |||||||||
| Reversal during the year/period | (67,565,629 | ) | (63,584,323 | ) | (8,876,029 | ) | ||||||
| Recognized to revenue during the year/period | 63,584,323 | 48,728,479 | 6,802,233 | |||||||||
| Impairment during the year/period | - | - | - | |||||||||
| Ending balance | 63,584,323 | 48,728,479 | 6,802,233 | |||||||||
Contract liabilities
A contract liability is recognized when a payment is received or a payment is due (whichever is earlier) from a customer before the Group transfers the related services. Contract liabilities are recognized as revenue when the Group performs the services under the contract. As of December 31, 2024 and June 30, 2025, contract liabilities amounted to RMB236,821 and RMB557,741, respectively, which were presented as “Advances from customers”. All contract liabilities were recognized as revenue in the following year.
F-13
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies (cont.)
Interest income and other income
Other income, net primarily consists of government subsidies.
The Company’s PRC-based subsidiaries received government subsidies from certain local governments. The receipt of such subsidy income for the six months ended June 30, 2024 and 2025 is not contingent upon any further actions or performance of the Company’s PRC subsidiaries and the amounts do not have to be refunded under any circumstances. Subsidies are recognized as other income which is included in the unaudited condensed combined and consolidated statements of income upon receipt as further performance by the Company’s PRC subsidiaries is not required.
Interest income, net, consisted of accrued interest income from loans provided to two suppliers (See Note 5) and interest earned on bank deposits, offset by interest expense for short-term bank loans (see Note 11).
Value-added tax (“VAT”)
The Company’s subsidiaries in PRC are subject to VAT and related surcharges on revenue generated from providing services. Revenue from providing services including transportation service is generally subject to VAT at applicable tax rates and subsequently paid to PRC tax authorities after netting input VAT on purchase. The excess of output VAT over input VAT is reflected as VAT tax payable which was included in other current liabilities.
The PRC VAT rate is 9% for taxpayers providing transportation services for the six months ended June 30, 2024 and 2025.
Cost of revenues
The Group’s cost of revenue is primarily comprised of the transportation service costs paid to truckers through third-party management and administrative companies, fuel costs, depreciation of self-owned trucks, and other miscellaneous costs include taxes and charges, insurance fees and maintenance fees.
Selling and marketing expenses
Selling and marketing expenses consist primarily of employee related expenses for business development, rental and travel expenses.
General and administrative
General and administrative expenses consist primarily of employee related expenses for general corporate functions, including accounting, finance, tax, legal and human relations; costs associated with these functions including depreciation and amortization expenses, rental and other general corporate related expenses.
Research and development costs
The Group generally expenses research and development costs as incurred and are included as part of general and administrative expenses. Research and development expenses for the six months ended June 30, 2024 and 2025 were not significant.
The Group defers certain costs related to the software development activities associated with certain software which the Group has determined have future economic benefit. Management periodically reviews and revises, when necessary, its estimate of future benefit of these costs and expenses them if it deems there no longer is a future benefit. The Group has one software for internal use, Transportation Management System (TMS) As of December 31, 2024 and June 30, 2025, software development cost capitalized net of amortization was RMB 286,389 and RMB 282,550, respectively, which is included as property, equipment and software, net.
F-14
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies (cont.)
Income taxes
The Group accounts for income taxes under ASC 740, Income Taxes. Provision for income taxes consists of current taxes and deferred taxes.
Current tax is recognized based on the results for the year as adjusted for items which are non-assessable or disallowed. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.
Deferred tax is recognized in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax basis. Deferred tax is calculated using tax rates that are expected to apply to the period when the asset is realized, or the liability is settled. Deferred tax is charged or credited in the income statement, except when it is related to items credited or charged directly to equity. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.
An uncertain tax position is recognized as a benefit only if it is “more likely than not” that the tax position would be sustained in a tax examination, with a tax examination being presumed to occur. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. The Group does not consider that there were any uncertain tax positions as of December 31, 2024 and June 30, 2025.
Segment reporting
ASC 280, “Segment Reporting”, establishes standards for reporting information about operating segments on a basis consistent with the Group’s internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for details on the Group’s business segments.
The Group uses the management approach to determine reportable operating segments. The management approach considers the internal organization and reporting used by the Group’s chief operating decision maker (“CODM”), i.e. the Group’s chief executive officer, for making decisions, allocating resources and assessing performance. As a result of the assessment made by CODM, the Group has only one reportable segment. The Group does not distinguish revenues, costs and expenses between segments in its internal reporting, but instead reports costs and expenses by nature as a whole.
Earnings per share
The Group computes earnings per share (“EPS”) in accordance with ASC 260, Earnings per Share (“ASC 260”). ASC 260 requires companies to present basic and diluted EPS. Basic EPS is computed by dividing net earnings attributable to ordinary shareholders by the weighted-average number of ordinary shares outstanding during the period. Diluted EPS further takes into account of the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised and converted into ordinary shares. For the six months ended June 30, 2024 and 2025, the Group had no dilutive securities.
F-15
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies (cont.)
Foreign currency translation and transactions
The functional currencies of the Group are the local currency of the country in which the subsidiaries operate. The reporting currency of the Group is the Renminbi (“RMB”). The results of operations and the unaudited condensed combined and consolidated statements of cash flows denominated in foreign currencies are translated at the average rates of exchange during the reporting period. Assets and liabilities denominated in foreign currencies at the balance sheet date are translated at the applicable rates of exchange in effect at that date. The equity denominated in the functional currencies is translated at the historical rates of exchange at the time of capital contributions. Because cash flows are translated based on the average translation rates, amounts related to assets and liabilities reported on the unaudited condensed combined and consolidated statements of cash flows will not necessarily agree with changes in the corresponding balances on the unaudited condensed consolidated balance sheets. Translation adjustments arising from the use of different exchange rates from period to period are included as a separate component of accumulated other comprehensive income included in unaudited condensed combined and consolidated statements of changes in shareholder’s equity. Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency in the unaudited condensed combined and consolidated statement of income and comprehensive income.
The functional currency of entities incorporated in Cayman and BVI is the U.S. dollar. The functional currency of entities incorporated in Hong Kong is the Hong Kong dollar (“HKD”). The Company’s subsidiaries with operations in PRC use the local currency, Renminbi (“RMB”), as their functional currencies. An entity’s functional currency is the currency of the primary economic environment in which it operates, normally that is the currency of the environment in which the entity primarily generates and expends cash. Management’s judgment is essential to determine the functional currency by assessing various indicators, such as cash flows, sales price and market, expenses, financing and inter-company transactions and arrangements.
Convenience translation
Translations of amounts in the unaudited condensed consolidated balance sheet, and the related unaudited condensed combined and consolidated statements of income and comprehensive income, changes in shareholder’s equity and cash flows from RMB into US$ as of and for the six months ended June 30, 2025 are solely for the convenience of the reader and were calculated at the noon buying rate of US$1 = RMB7.1636 on June 30, 2025, as published in H.10 statistical release of the United States Federal Reserve Board. No representation is made that the RMB amounts could have been, or could be, converted, realized or settled into US$ at such rate or at any other rate. The US$ convenience translation is not required under U.S. GAAP and all US$ convenience translation amounts in the accompanying unaudited condensed combined and consolidated financial statements are unaudited.
F-16
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies (cont.)
Fair value of financial instruments
The fair value of a financial instrument is defined as the exchange price that would be received from an asset or paid to transfer a liability (as exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:
Level 1 — Quoted prices in active markets for identical assets and liabilities.
Level 2 — Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.
Unless otherwise disclosed, the fair value of the Group’s financial instruments, including cash, accounts receivable, prepayments and other receivables, accounts and other payables, due to related parties, short-term bank borrowings, taxes payable and current operating lease liabilities, approximates their recorded values due to their short-term maturities.
Related parties
Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject to common control or significant influence of the same party, such as a family member or relative, shareholder, or a related corporation.
Commitments and contingencies
In the normal course of business, the Group is subject to contingencies, such as legal proceedings and claims arising out of its business, which cover a wide range of matters. Liabilities for contingencies are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.
If the assessment of a contingency indicates that it is probable that a material loss is incurred and the amount of the liability can be estimated, then the estimated liability is accrued in the Group’s unaudited condensed combined and consolidated financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed.
Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed.
The adoption of accounting policy and recent accounting pronouncements
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures intended to enhance transparency and decision usefulness of income tax disclosures. This guidance is effective for public entities for annual periods beginning after December 15, 2024 and for annual periods beginning after December 15, 2025 for all other entities, and the guidance should be applied prospectively. The Group are permitted to early adopt and can choose to apply the guidance retrospectively. When adopted, The Group expects the guidance to have an impact on disclosures only and to not have a material effect on our financial position or results of operations. The Group are still considering if the Group will apply the standard prospectively or retrospectively.
F-17
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
2. Summary of Significant Accounting Policies (cont.)
In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures intended to improve reportable segment disclosures and to enhance disclosures about significant reportable segment expenses. This guidance is effective for public entities fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, and is required to be applied retrospectively to all prior periods presented. Because the amendments do not change the methodology for the identification of operating segments, the aggregation of those operating segments or the application of the quantitative thresholds to determine reportable segments, the Group do not expect the guidance to have a material effect on our financial position or results of operations.
The Group considers the applicability and impact of all accounting standards updates. Management does not believe that any other recently issued, but not yet effective, accounting pronouncements, if currently adopted, would have a material effect on the Group’s unaudited condensed combined and consolidated financial statements.
Subsequent Events
The Group evaluates all events and transactions that occur after June 30, 2025 up through to the date when the Group issued the unaudited condensed combined and consolidated financial statements. Other than the event disclosed elsewhere and in Note 16 in the unaudited condensed combined and consolidated financial statements, there is no other subsequent event occurred that would require adjustment or disclosure in the Group’s unaudited condensed combined and consolidated financial statements.
3. Specific Risks
Currency risk
A majority of the Group’s transactions are denominated in RMB and a significant portion of the Group’s assets and liabilities are denominated in RMB. The RMB is not freely convertible into foreign currencies. In the PRC, certain foreign exchange transactions are required by law to be transacted only by authorized financial institutions at exchange rates set by the People’s Bank of China (“PBOC”). It is difficult to predict how market forces or PRC or U.S. government policy may impact the exchange rate between the RMB and the U.S. dollar in the future. Remittances in currencies other than RMB by the companies in China must be processed through the PBOC or other China foreign exchange regulatory bodies which require certain supporting documentation in order to affect the remittance.
The Group has not entered into any hedging transactions in an effort to reduce its exposure to foreign exchange risk.
Concentration and credit risks
Financial instruments that potentially subject the Group to credit risks consist of cash, receivables from customers. The maximum exposures of such assets to credit risk are their carrying amounts as of the balance sheet dates.
The Group deposits its cash with banks located in Hong Kong and the PRC. As of December 31, 2024 and June 30, 2025, RMB10,522,943 and RMB3,277,379 were deposited with these banks, respectively. Balances maintained with banks in Hong Kong are insured under the Deposit Protection Scheme introduced by the Hong Kong Government for a maximum amount of RMB 730,400 (HK$ 800,000) for each depositor at one bank, while the balances maintained by the Group may at times exceed the insured limits. Cash balances maintained with banks in the PRC are not otherwise insured. The Group has not experienced any losses in these bank accounts and management believes that the Group is not exposed to any significant credit risk on cash.
For the credit risk related to receivables from customers, the Group performs regular and ongoing credit assessments of the counterparts’ financial conditions and credit histories. The Group also assesses historical collection trends and aging of receivables. The Group considers that it has adequate controls over these receivables in order to minimize the related credit risk. As of December 31, 2024 and June 30, 2025, allowance for credit losses were recorded at RMB89,688, respectively. The adoption of ASU 2016-13 on January 1, 2023 did not have a material impact on our consolidated financial statements and disclosures
F-18
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
3. Specific Risks (cont.)
For the six months ended June 30, 2024 and 2025, most of the Group’s assets were located in PRC. At the same time, the Group considers that it is exposed to the following concentrations of risk:
| (a) | Major customers |
For the six months ended June 30, 2024 and 2025, customer A with its subsidiaries accounted for 14% and 12% of the Group’s total revenues, respectively.
Total balance of accounts receivable and contract assets generated from customer A accounted for 19% and 30% of the Group’s total balances of accounts receivable and contract assets, as of December 31, 2024 and June 30, 2025 respectively.
| (b) | Major suppliers |
For the six months ended June 30, 2024, supplier A and supplier B from which the Group’s purchases of transportation services accounted for 76% and 20% of the Group’s total costs of transportation service respectively. For the six months ended June 30, 2025, supplier A and supplier B from which the Group’s purchase of transportation services accounted for 96% and 1% of the Group’s total costs of services respectively.
As of June 30, 2025, balance of accounts payable generated from supplier A and supplier B are accounted for nil of the Group’s total balances of accounts payable. As of December 31, 2024, balance of accounts payable generated from supplier A accounted to 84% and supplier B accounted for nil of the Group’s total balances of accounts payable.
Supplier A and supplier B primarily assist the Group to manage and coordinate with the independent truckers for payments and administrative services. The transportation service fees are paid to truckers through the supplier A and supplier B’s services.
Interest rate risk
Fluctuations in market interest rates may negatively affect the Group’s financial conditions and results of operations. The Group is exposed to floating interest rate risk on bank deposits and floating rate borrowings, and the risks due to changes in interest rates is not material. The Group has not used any derivative financial instruments to manage the interest risk exposure.
Business and economic risk
The Group participates in the dynamic and competitive contract logistics industry and believes that changes in any of the following areas could have a material adverse effect on the Group’s future financial position, results of operations and cash flows: changes in the overall demand for services; changes in global fuel fee; changes in business offerings; competitive pressures due to existing and new service providers; changes in certain strategic relationships or customer relationships; risks associated with the Group’s ability to attract and retain employees and independent truckers necessary to support its growth and risks related to health epidemics; severe weather conditions and other outbreaks.
The Group’s operations could be adversely affected by significant political, economic and social uncertainties and epidemic in mainland China.
F-19
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
4. Accounts receivable, net
As of December 31, 2024 and June 30, 2025, accounts receivable, net consist of the following:
| As of | ||||||||||||
| December 31, 2024 | June 30, 2025 | June 30, 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Accounts receivable | 15,832,671 | 16,457,060 | 2,297,317 | |||||||||
| Allowance for credit losses | (89,688 | ) | (89,688 | ) | (12,520 | ) | ||||||
| Total accounts receivable, net | 15,742,983 | 16,367,372 | 2,284,797 | |||||||||
5. Prepayments and other current assets
As of December 31, 2024 and June 30, 2025, prepayment and other current assets consist of the following:
| As of | ||||||||||||
| December 31, 2024 | June 30, 2025 | June 30, 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Deposit and other receivables (a) | 328,837 | 326,084 | 45,520 | |||||||||
| Deductible input VAT –estimated (b) | 5,400,771 | 4,390,048 | 612,827 | |||||||||
| Prepayment to suppliers (c) | 1,335,702 | 24,872,551 | 3,472,074 | |||||||||
| Total prepayment and other current assets | 7,065,310 | 29,588,683 | 4,130,421 | |||||||||
| (a) | Deposit and other receivables included rent deposits, staff advances and other miscellaneous receivables |
| (b) | Deductible input VAT - estimated represented the input VAT tax on transportation services completed but not being issued of VAT invoice at the end of the year/period |
| (c) | Prepayment to suppliers mainly represented the prepaid diesel fuel cost and other miscellaneous prepayments |
F-20
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
6. ROU assets and operating lease liabilities
As of December 31, 2024 and June 30, 2025, the Group has operating leases recorded on its unaudited condensed consolidated balance sheets for office spaces that expire on various dates through 2026. The locations are mainly in mainland China and Hong Kong. The Group does not plan to cancel the existing lease agreements for its existing facilities prior to their respective expiration dates. When determining the lease term, the Group considers options to extend or terminate the lease when it is reasonably certain that it will exercise or not exercise that option, if any. Payments under the Group’s lease arrangements are fixed.
Information related to operating lease activities during the six months ended June 30, 2024 and 2025 are as follows:
| For the period ended June 30, | ||||||||||||
| 2024 | 2025 | 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Operating lease expense from fixed payment | 351,695 | 344,555 | 48,098 | |||||||||
| Short-term lease expenses | 287,378 | 307,264 | 42,892 | |||||||||
| Total operating lease expenses | 639,073 | 651,819 | 90,990 | |||||||||
| Cash paid for amounts included in the measurement of lease liabilities | 312,163 | 277,386 | 38,722 | |||||||||
F-21
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
6. ROU assets and operating lease liabilities (cont.)
The following table summarizes the remaining contractual maturities of lease liabilities under operating lease as of June 30, 2025:
| RMB | ||||
| From July 1 to December 31, 2025 | 90,604 | |||
| For the year ending December 31, 2026 | - | |||
| Thereafter | - | |||
| Total future lease payments | 90,604 | |||
| Less: imputed interest | (192 | ) | ||
| Present value of lease obligations | 90,412 | |||
The weighted-average discount rate used to determine the operating lease liabilities as of December 31, 2024 and June 30, 2025 was 5.00% and 5.00%, respectively, and the weighted-average remaining lease term as of December 31, 2024 and June 30, 2025 was 0.67 years and 0.17 years, respectively.
7. Property, equipment and software, net
As of December 31, 2024 and June 30, 2025, property, equipment and software, net, consisted of the following:
| As of | ||||||||||||
| December 31, 2024 | June 30, 2025 | June 30, 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Building and improvements | 19,426,359 | 19,426,359 | 2,711,815 | |||||||||
| Leasehold improvements | 364,349 | 359,430 | 50,175 | |||||||||
| Computer equipment | 1,797,728 | 1,792,632 | 250,242 | |||||||||
| Office equipment | 855,129 | 852,639 | 119,024 | |||||||||
| Transportation equipment | 12,690,712 | 12,686,018 | 1,770,900 | |||||||||
| Licensed software | 1,213,491 | 1,272,359 | 177,614 | |||||||||
| Construction-in-progress | 22,288,563 | 22,464,975 | 3,135,990 | |||||||||
| Property, equipment and software | 58,636,329 | 58,854,412 | 8,215,760 | |||||||||
| Less: accumulated depreciation and amortization | (18,841,204 | ) | (19,663,494 | ) | (2,744,919 | ) | ||||||
| Total property, equipment and software, net | 39,795,125 | 39,190,918 | 5,470,841 | |||||||||
Depreciation and amortization expense was RMB879,121 and RMB822,290 (US$114,787) for the six months ended June 30, 2024 and 2025, respectively. The Group’s building and construction-in-progress with an aggregate carrying amount of RMB 13,441,292 and RMB13,234,160 (US$1,847,417) were pledged to bank to secure the bank loan as of December 31, 2024 and June 30, 2025 respectively, reference to short-term bank loan.
Among the construction-in-progress, there are three buildings which have been completed but are not ready for internal use and amounting to RMB13,981,477 and RMB14,157,888 (US$1,939,623) in aggregate as of December 31, 2024 and June 30, 2025, respectively. However, the property certificates have not yet been issued due to the absence of a final inspection by local authorities in China. Hence, the use of the three buildings is currently restricted.
F-22
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
8. Land use rights, net
The following table summarizes the components of land use right balances.
| As of, | ||||||||||||
| December 31, 2024 | June 30, 2025 | June 30, 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Land use right | 9,562,194 | 9,562,194 | 1,334,830 | |||||||||
| Less: accumulated amortization | (1,290,896 | ) | (1,386,518 | ) | 193,550 | ) | ||||||
| Land use right, net | 8,271,298 | 8,175,676 | 1,141,280 | |||||||||
Amortization expenses of the land use right for the year ended December 31, 2024 and six months ended June 30, 2025 amounted to approximately RMB 95,622 and RMB 95,622 (US$ 13,348), respectively. The Group’s land with an aggregate carrying amount of 8,271,298 and RMB 8,175,676 (US$1,141,280) were pledged to bank to secure the bank loan as of December 31, 2024 and June 30, 2025 respectively.
| Description of land use right | Jinxi County Xiaxiao Highway intersection No.206 Guo Road West Yuan Gua Industrial Park | |
| Useful life | 50 years from March 5, 2018 to March 4, 2068 | |
| Area | 108,823.20 square meters | |
| Cost | RMB 9,562,194 (including 1% transaction service fee) |
The future amortization for the land use right is expected to be as follows:
| For the year ending December 31, | Estimated amortization expense | ||||
| RMB | |||||
| From July 1 to December 31, 2025 | 95,622 | ||||
| 2026 | 191,244 | ||||
| 2027 | 191,244 | ||||
| 2028 | 191,244 | ||||
| Thereafter | 7,506,322 | ||||
| Total | 8,175,676 | ||||
9. Other non-current assets and non-current liabilities
| As of | ||||||||||||
| December 31, 2024 | June 30, 2025 | June 30, 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Prepayment for long-lived assets (1) | 13,101,375 | 13,101,375 | 1,828,881 | |||||||||
| Customer deposits (2) | 7,409,000 | 7,009,000 | 978,419 | |||||||||
| Deferred offering costs (3) | 9,025,015 | 10,219,794 | 1,426,628 | |||||||||
| Other non-current assets | 29,535,390 | 30,330,169 | 4,233,928 | |||||||||
| Security deposits (4) | 5,840,000 | 5,840,000 | 815,233 | |||||||||
| Other non-current liabilities | 5,840,000 | 5,840,000 | 815,233 | |||||||||
| (1) | Prepayments for long-lived assets primarily consisted of prepayments for construction as of June 30, 2025. The status of the construction is still under progress. |
| (2) | Customer deposits represent the refundable deposits with certain customers as requested for business security purposes. |
| (3) | Deferred offering costs represented the IPO-related professional fees, mainly consisting of legal service fee, financial advisory fee, and underwriter fee. |
| (4) | Security deposits represented the deposits received from the driver for business security purposes. |
F-23
Smart Logistics Global
Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
10. Short-term bank loans
| As of, | ||||||||||||
| December 31, 2024 | June 30, 2025 | June 30, 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Guaranteed by Jiangxi JB and the couple of Ms. Gong Su Fang (the legal representative of Jiangxi JB)(1) | 5,000,000 | 5,000,000 | 697,973 | |||||||||
| Credit loan, no guarantee(2) | 3,000,000 | 3,000,000 | 418,784 | |||||||||
| Collateralized by real estate properties of Fuzhou JB and guaranteed by Ms. Gong Su Fang (the legal representative of Jiangxi JB)(3) | 13,000,000 | 13,000,000 | 1,814,730 | |||||||||
| Guaranteed by Jiangxi JB, a third-party financing guarantee company and Mr. Hue, Kwok Chiu(4) | 5,000,000 | 5,000,000 | 697,973 | |||||||||
| Guaranteed by Jiangxi JB, Ms. Gong Su Fang (the legal representative of Jiangxi JB) and a third-party financing guarantee company(5) | 5,000,000 | 5,000,000 | 697,973 | |||||||||
| Total | 31,000,000 | 31,000,000 | 4,327,433 | |||||||||
| (1) | This bank loan will be due in December 2025. |
| (2) | In March 2025, the Group fully repaid RMB 3,000,000 to the bank. In the same month, the Group entered into another loan agreement with the same bank of RMB 3,000,000 (fixed interest rate of 3.3% per annum) with a term of one-year and without any guarantee. |
| (3) | In June 2025, the Group fully repaid RMB 13,000,000 to the bank. In the same month, the Group entered into another loan agreement with the same bank of RMB 13,000,000 (fixed interest rate of 3.3675% per annum) with a term of one-year and same guarantee terms as above. |
| (4) | In August 2025, the Group fully repaid RMB 5,000,000 to the bank. In the same month, the Group entered into another loan agreement with the same bank of RMB 4,900,000 (fixed interest rate of 4.9% per annum) with a term of one-year and guaranteed by Jiangxi JB, third-party supplier A and Mr. Hue Kwok Chiu. |
| (5) | In April 2025, the Group entered into a revolving loan agreement of RMB 5,000,000 (fixed interest rate of 3.1% per annum) with a term of one-year with a new bank. |
The short-term bank loans outstanding as of December 31, 2024 and June 30, 2025 carried a weighted average interest rate of approximately 3.94% and 3.60%, respectively. The interest expenses of the short-term bank loans for the six months ended June 30, 2024 and 2025 were RMB538,644 and RMB 585,225 (US$81,694) respectively, which were included as an item under interest income, net.
F-24
Smart Logistics Global
Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
11. Accrued expenses and other current liabilities
Accrued expenses and other current liabilities consisted of the following:
| As of, | ||||||||||||
| December 31, 2024 | June 30, 2025 | June 30, 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Other tax payables (1) | 8,757,388 | 8,193,320 | 1,143,743 | |||||||||
| Salary and welfare payables | 605,694 | 1,017,882 | 142,091 | |||||||||
| Others (2) | 570,359 | 1,994,491 | 278,418 | |||||||||
| Total | 9,933,441 | 11,205,693 | 1,564,252 | |||||||||
| (1) | Other tax payable primarily included VAT output tax payable related to transportation service revenue after deducting VAT input tax paid for purchases, land value-added tax, and other related surcharges and fees. |
| (2) | Others included amounts due for legal fee, statutory audit fee, and operating expenses incurred in Jiabin HK. |
12. Shareholder’s equity
Ordinary shares
The Company was established under the laws of Cayman Islands on October 8, 2020. The authorized and outstanding number of ordinary shares were 38,000,000 shares and 1 share, with a par value of HK$ 0.01 each, at both December 31, 2022 and 2023, respectively.
On February 19, 2024, a Board of Directors meeting was held regarding the increase of authorized capital. According to the approval of the Board of Directors, the authorized capital of the Company increased from HK$380,000 to HK$15,600,000, with the corresponding authorized shares increased from 38,000,000 shares to 1,560,000,000 shares.
On September 24, 2024, it was resolved in a meeting of the Board of Directors of the Company (i) that the amended and restated memorandum and articles of association of the Company be adopted to effectuate that the Company’s issued and outstanding shares be sub-divided on the basis of 1 share being divided into 100 shares, resulting in the authorized share capital of the Company be changed from HK$15,600,000 divided into 1,560,000,000 shares with a nominal or par value of HK$0.01 each to HK$15,600,000 divided into 156,000,000,000 shares with a nominal or par value of HK$0.0001 each (the “Stock Split”). As a result of the Stock Split but before the Share Subscription (as defined below), ASL Ventures Limited held 100 shares of the Company; (ii) and that the Company will issue and ASL Ventures Limited will subscribe for 39,999,900 shares of the Company with a par value of HK$0.0001 each for a cash consideration of HK$3,999.99 (the “Share Subscription”). On September 24, 2024, the resolutions of the sole shareholder of the Company, ASL Ventures Limited, was also passed to effectuate the amended and restated memorandum and articles of association of the Company, the Stock Split and Share Subscription. Accordingly, the amended and restated memorandum and articles of association of the Company was deemed adopted and the Stock Split and Share Subscription were deemed completed on September 24, 2024, and ASL Ventures Limited held 40,000,000 shares of the Company immediately afterward.
According to ASC 260, the Company has retroactively restated all shares, share associated amounts, and per share data for all periods presented. In addition, the proceeds from the Share Subscription in the amount of HK$3,999 (approximately US$500) remained outstanding and presented as subscription receivable, a contra-equity account in the unaudited condensed combined and consolidated financial statements.
Statutory reserves and restricted net assets
The Company’s PRC subsidiaries are required to make appropriations to certain reserve funds, comprising the statutory surplus reserve and the discretionary surplus reserve, based on after-tax net income determined in accordance with PRC accounting standards and regulations. Appropriations to the statutory surplus reserve are required to be at least 10% of the after-tax net income until the reserve is equal to 50% of the entity’s registered capital. Appropriations to the discretionary surplus reserve are made at the discretion of the Board of Directors. The statutory reserve as determined pursuant to PRC statutory laws totaled approximately RMB 23,853,066 and RMB 24,860,883 (US$ 3,470,445) as of December 31, 2024 and June 30, 2025, respectively. Furthermore, registered share capital and capital reserve accounts are also restricted from distribution. Such restriction amounted to approximately RMB 108 million (US$ 14.8 million) and RMB 108 million (US$15.1 million) as of December 31, 2024 and June 30, 2025, respectively. As a result of the restrictions described above and elsewhere under PRC laws and regulations, the Company’s subsidiaries incorporated in the PRC are restricted in their ability to transfer a portion of their net assets to the Company in the form of dividends. Except for the above or disclosed elsewhere, there is no other restriction on the use of proceeds generated by the Company’s subsidiaries to satisfy any obligations of the Group.
F-25
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
13. Income taxes
(a) Corporate Income Taxes (“CIT”)
Cayman Islands
The Company was incorporated in the Cayman Islands and is not subject to tax on income or capital gains under the laws of Cayman Islands. Additionally, the Cayman Islands does not impose a withholding tax on payments of dividends to shareholder.
British Virgin Islands
Amelia is incorporated in the British Virgin Islands and is not subject to tax on income or capital gains under current British Virgin Islands law. In addition, upon payments of dividends by these entities to their shareholder, no British Virgin Islands withholding tax will be imposed.
Hong Kong
Jiabin HK is incorporated in Hong Kong and is subject to Hong Kong Profits Tax rate at 16.5%, and foreign-derived income is exempted from income tax. The Group did not make any provisions for Hong Kong profit tax as there were no assessable profits derived from or earned in Hong Kong since inception.
PRC
The Company’s PRC subsidiaries are governed by the income tax laws of the PRC and the income tax provision in respect to operations in the PRC is calculated at the applicable tax rates on the taxable income for the periods based on existing legislation, interpretations and practices in respect thereof. Under the Enterprise Income Tax Lawes of the PRC (the “EIT Laws”), Chinese enterprises are subject to income tax rate of 25% after appropriate tax adjustments.
The current and deferred portions of the income tax expenses included in the unaudited condensed combined and consolidated statements of income and comprehensive income as determined in accordance with ASC 740 are as follows:
| For the Six Months Ended June 30, | ||||||||||||
| 2024 | 2025 | 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Current taxes | 1,441,400 | 2,703,330 | 377,370 | |||||||||
| Deferred taxes | (122,779 | ) | (382,131 | ) | (53,343 | ) | ||||||
| Income tax expenses | 1,318,621 | 2,321,199 | 324,027 | |||||||||
F-26
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
13. Income taxes (cont.)
A reconciliation between the Group’s actual provision for income taxes and the provision at the PRC, mainland statutory rate is as follows:
| For the Six Months Ended June 30, | ||||||||||||
| 2024 | 2025 | 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Profit before income taxes | 2,594,566 | 8,150,695 | 1,137,795 | |||||||||
| Applicable income tax rate | ||||||||||||
| - Statutory income tax rate in PRC | 25.0 | % | 25.0 | % | 25.0 | % | ||||||
| Income tax expenses at applicable income tax rate | 648,642 | 2,037,674 | 284,448 | |||||||||
| Non-deductible expenses | (14,472 | ) | 72,731 | 10,153 | ||||||||
| Tax effect for offshore entity’s net loss | 651,414 | 179,668 | 25,081 | |||||||||
| Change in valuation allowance | 33,037 | 31,126 | 4,345 | |||||||||
| Income tax expense | 1,318,621 | 2,321,199 | 324,027 | |||||||||
As of December 31, 2024 and June 30, 2025, the income tax payable was RMB 2,667,477 and RMB 1,365,801 (US$ 190,658), respectively.
(b) Deferred tax
Deferred income tax assets and liabilities are comprised the following as of December 31, 2024 and June 30, 2025:
| As of | ||||||||||||
| December 31, 2024 | June 30, 2025 | June 30, 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Unbilled transportation costs accrued | 14,319,915 | - | - | |||||||||
| Contract assets | - | 3,839,915 | 536,031 | |||||||||
| Net operating losses | 556,429 | 588,118 | 82,098 | |||||||||
| Other | 1,986 | 1,423 | 199 | |||||||||
| Deferred tax assets | 14,878,330 | 4,429,456 | 618,328 | |||||||||
| Less: Valuation allowance | (558,415 | ) | (589,541 | ) | (82,297 | ) | ||||||
| Deferred tax assets, net | 14,319,915 | 3,839,915 | 536,031 | |||||||||
| Contract assets | (15,733,957 | ) | - | - | ||||||||
| Right-of use assets | (6,112 | ) | (1,528 | ) | (213 | ) | ||||||
| Accrued interest income | (1,753,976 | ) | (1,753,977 | ) | (244,846 | ) | ||||||
| Accrued Cost and expense | - | (4,876,409 | ) | (680,720 | ) | |||||||
| Deferred tax liabilities | (17,494,045 | ) | (6,631,914 | ) | (925,779 | ) | ||||||
| Deferred tax liabilities, net | (3,174,130 | ) | (2,791,999 | ) | (389,748 | ) | ||||||
The Group evaluated the recoverable amounts of deferred tax assets, and provided a valuation allowance to the extent that future taxable profits will be available against which the net operating loss and temporary difference can be utilized. The Group considers both positive and negative factors when assessing the future realization of the deferred tax assets and applied weight to the relative impact of the evidence to the extent it could be objectively verified.
As of December 31, 2024 and June 30, 2025, there were approximately RMB 2,218,078 and RMB 2,329,743 (US$325,219) net operating loss carry-forward, respectively, from Fuzhou Feiyi and Jiangxi JB. The net loss can be carried forward for 5 years and deduct the future profit in PRC. The Group believed that it was more likely than not that Jiangxi JB and Fuzhou Feiyi will be unable to fully utilize its deferred tax assets related to the net operating loss carry-forward in PRC. As a result, the valuation allowance of RMB 558,415 and RMB589,541 (US$82,297) was recorded against the gross deferred tax asset balance as of December 31, 2024 and June 30, 2025, respectively.
As of December 31, 2024 and June 30, 2025, the Group did not provide deferred income taxes and withholding taxes on the undistributed earnings of the PRC subsidiaries during the years presented on the basis of its at that point to permanently reinvest its PRC subsidiaries’ earnings.
F-27
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
14. Related Party Transaction and Balance
(1) Due to controlling shareholder
| Name of Related Party | Relationship | Nature | December 31, 2024 |
June 30, 2025 |
June 30, 2025 |
|||||||||||
| RMB | RMB | US$ | ||||||||||||||
| Mr. Hue Kwok Chiu | Sole and ultimate shareholder, Chairman and Chief Executive Officer | Advances for operational purposes | 1,290,837 | 4,983,711 | 695,699 | |||||||||||
The balance represented advances from the ultimate shareholder. The balances were unsecured, non-interest bearing and repayable on demand.
On May 31, 2024, Fuzhou JB, Jiabin HK and Mr. Hue Kwok Chiu entered into a tripartite deed (the “Deed”). Upon the completion of the Deed (see below Note (2)), Jiabin HK assumes to repay RMB123.27 million and the balance was reduced to RMB11 million.
During the period ended June 30, 2025, Jiabin HK borrowed approximately RMB 3.8 million from Mr. Hue Kwok Chiu and made no repayments during the period. As of October 31, 2025, the balance payable to Mr. Hue Kwok Chiu had increased to approximately RMB 7.0 million.
(2) Shareholder borrowing
On December 14, 2023, Fuzhou JB, Mr. Hue, Kwok Chiu and Jiabin HK entered into a supplemental agreement pursuant to which it is agreed that, among other things, Mr. Hue, Kwok Chiu’s loans due to Fuzhou JB in the aggregate amount of RMB120,000,000 (US$ 16,901,647) and the carrying interests at a simple rate of 3.55% per annum will become repayable before December 31, 2024.
On May 31, 2024, Fuzhou JB, Jiabin HK and Mr. Hue Kwok Chiu entered into the Deed. Pursuant to the Deed, (i) Mr. Hue Kwok Chiu transfers his obligation under the Debt agreement to Jiabin HK, and Jiabin HK agrees to assume and repay any and all of liabilities of Mr. Hue Kwok Chiu under the Debt Agreements between Mr. Hue Kwok Chiu and Fuzhou JB in the aggregate amount of RMB120 million (US$16.5 million) and all accrued interest thereunder amounting to RMB3.27 million and (ii) Fuzhou JB agrees to seek repayment of these liabilities exclusively from Jiabin HK and not to seek repayment of any such liability from Mr. Hue Kwok Chiu. After completion of such transactions, Mr. Hue Kwok Chiu shall be deemed to have discharged his liabilities under the Debt Agreement.
On December 24, 2024, Fuzhou JB entered into a supplemental agreement pursuant to which it is agreed that, among other things, Jiabin HK’s loans due to Fuzhou JB in the aggregate amount of RMB120,000,000 (US$16,439,933) and the carrying interests at a simple rate of 3.55% per annum will become repayable before December 30, 2025.
F-28
Smart Logistics Global Limited
Notes to Unaudited Condensed Combined and Consolidated Financial Statements
15. Commitments and Contingencies
Commitments
As of December 31, 2024 and June 30, 2025, the Group had a contractual commitment of RMB 20.50 million and RMB 20.50 million, respectively under a building construction agreement with a total contractual amount of RMB 39.3 million.
| December 31, 2024 | June 30, 2025 | June 30, 2025 | ||||||||||
| RMB million | RMB million | US$ million | ||||||||||
| Within 1 year | 5.0 | 5.0 | 0.7 | |||||||||
| 1 - 3 years | 15.5 | 15.5 | 2.1 | |||||||||
| 20.5 | 20.5 | 2.8 | ||||||||||
Contingencies
As of December 31, 2024 and June 30, 2025, the Group was not a party to any material legal or administrative proceedings. From time to time, the Group is involved in various other legal and regulatory proceedings arising in the normal course of business. While the Group cannot predict the occurrence or outcome of these proceedings with certainty, it does not believe that an adverse result in any pending legal or regulatory proceeding, individually or in the aggregate, would be material to the Group’s combined and consolidated financial condition or cash flows; however, an unfavorable outcome could have a material adverse effect on the Group’s results of operations.
16. Subsequent Events
The Group evaluated subsequent events and transactions that occurred after the balance sheet date through the date that the unaudited condensed combined financial statements are available to be issued.
New underwriter assignment
On August 14, 2025, the Company, Revere Securities LLC (the “Assignor”) and Craft Capital Management, LLC (the “Assignee”) entered into an assignment and assumption agreement (the “Assignment”) pursuant to which the Assignor irrevocably and absolutely assigns and transfers to Assignee all of Assignor’s rights and obligations as the exclusive lead and managing underwriter, as set forth in the engagement letter between the Company and the Assignor in connection with the Company’s initial public offering. Upon the effectiveness of the Assignment, the Assignee became the exclusive lead and managing underwriter while the Assignor continued to be an underwriter in connection with the Company’s initial public offering.
Completed initial public offering (IPO)
On October 16, 2025, the Company completed its initial public offering of 1,000,000 ordinary shares, at an offering price of $5.00 per share, raising gross proceeds of US$5 million. As this transaction occurred after the reporting period ended June 30, 2025, it is treated as a non-adjusting subsequent event in accordance with ASC 855. Accordingly, no adjustments have been made to the financial statements as of June 30, 2025.
Incentive Securities Plan
On October 14, 2025, the Company’s sole shareholder approved the Smart Logistics Global Limited 2025 Incentive Securities Plan (the “2025 Incentive Securities Plan”) to promote the success of the Company. Under the 2025 Equity Incentive Plan, the maximum aggregate number of ordinary shares which may be issued is 8,200,000. As of the date of this Interim Report, the Company has issued 2,000,000 ordinary shares under the 2025 Incentive Securities Plan.
On November 25, 2025, to the Company filed a Registration Statement on Form S-8 to register 8,200,000 shares reserved and available for issuance pursuant to the 2025 Incentive Securities Plan.
Share Award Agreement
On December 4, 2025, the Company issued 2,000,000 ordinary shares, par value HK$0.0001 each, to third-party consultant, under the 2025 Incentive Securities Plan.
F-29
Exhibit 99.2
MANAGEMENT’S DISCUSSION AND ANALYSIS
OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes included elsewhere in this prospectus. This discussion contains forward-looking statements reflecting our current expectations that involve risks and uncertainties. See “Disclosure Regarding Forward-Looking Statements” for a discussion of the uncertainties, risks and assumptions associated with these statements. Actual results and the timing of events could differ materially from those discussed in our forward-looking statements as a result of many factors, including those set forth under “Risk Factors” and elsewhere in this prospectus. Additionally, unless otherwise stated, the terms “SLG Cayman,” “the Company” and “our Company” in the following discussion and analysis of our financial condition and results of operations refer to Smart Logistics Global Limited. The terms “we,”, “us,” “Group,” “our Group” and “our” refer to Smart Logistics Global Limited and its subsidiaries.
Overview
We are a well-established, reputable and innovative business-to-business contract logistics solution provider in the PRC focusing on industrial raw materials line-haul transportation business. We offer our customers cost-efficient, flexible and reliable logistic solutions with optimized transportation methods and routes tailored to their varying needs. For instance, we suggest to our customers the most suitable trucks and transportation equipment for the job, and the most cost- and time-saving routes to lower cost. We primarily provide land-only transportation as of the date of this prospectus.
We are able to offer comprehensive, customized logistic solutions to our customers because since the first day of our operation, we have been collecting and accumulating intelligence on the macro-logistics landscape of our targeted markets. We have developed our self-owned proprietary digitized system, including the Transportation Management System, during 2017 to 2019 through software companies which stores logistics data such as truck load data on each completed order, for our use and analysis. Leveraging on our experience, we are able to advise our customers the shortest, fastest and/or most cost-efficient transportation method, mode and routes with the aim to achieve cost-savings for our customers and in turn enhance our customers’ price competitiveness.
We strategically aim at serving customers in four major sectors in the PRC, namely paper, steel, coal and food, as we believe these are core sectors driving the PRC economies which are relatively immune to cyclical economic changes, and therefore we can also lower our risk to suffer from cyclical economic fluctuations by targeting the customers in these industries. A significant portion of our customers are large institutional customers, with whom we have maintained long-term relationships and typically enter into contracts for our provision of logistic solutions on a yearly basis. It is our strategy to prioritize these large customers because they usually demand high volume and long distance transportations between certain designated locations, which is generally more favourable for our operational efficiency, cost management and pricing, and provides more stable recurring revenue stream.
We generate revenue from the provision of transportation services under our contract logistics business. Our total revenue was approximately RMB298.7 million and RMB332.8 million (USD46.5 million) for the six months ended June 30, 2024 and 2025, respectively, representing an increase of approximately 11.4%. We recorded net income of approximately RMB1.3 million and RMB5.8 million (USD0.8 million) for the six months ended June 30, 2024 and 2025, respectively.
Key Factors Affecting our Results of Operations
General economic conditions in the PRC and developments in the industry
Our business and operating results are affected by a number of general factors in the PRC’s logistics industry, including, but not limited to:
| ● | The PRC’s overall economic growth, level of industrialization and level of logistics developments; |
| ● | Developments of the industrial raw materials and necessities industry in the PRC in which our major customers were engaged in, especially within the primary regions in the PRC we typically operate in; and |
| ● | Overall market competition in the PRC’s logistics industry. |
Unfavorable changes in any of these general factors could materially and adversely affect our business and our results of operations.
Our ability to retain major customers and obtain new customers
For the six months ended June 30, 2024 and 2025, one customer with its subsidiaries accounted for 14% and 12% of the Group’s total revenues, respectively. Our ability to maintain stable business relationships with our customers, especially our major ones, will affect our revenue generated from our provision of contract logistics solutions to them. If we are unable to enter into new service contracts with our customers upon expiry of the current contracts, or there is a reduction or cessation of demands from these customers for whatever reasons and we are unable to enter into service contracts of comparable size and terms in substitution, our business, financial conditions and results of operation may be materially and adversely affected. We also develop new customers in our FTL centres located in strategic locations in PRC through referral of our existing customers and our own efforts. Therefore, our ability to expand our network of FTL centres into new geographic regions also affects our ability to secure new customers, and thus our business performance and results of operations.
Our ability to maintain and expand our truckers pool
Our ability to fulfil our customers’ transportation needs and to thus earn our revenue depends on our ability to secure suitable truckers for each job. Therefore, our ability to maintain and expand our truckers pool affects our ability to maintain and grow our business scale and results of operations. In carrying out our contract logistics business, while we select the best fitting truckers and trucks for our customers, we also establish steady and reciprocal relationships with truckers through repeated transactions with us through our suppliers. The number of truckers registered in our TMS increased from approximately 130,000 as at December 31, 2024 and over 140,000 as at the date of this prospectus, and it is our strategy to continue expanding such pool.
Strategic acquisitions and investments
We may selectively pursue acquisitions and investments that we believe are strategic and complementary to our operations and technology. The business or financial performance of the companies we have invested in as well as our ability to successfully integrate these investments with our existing business would impact our results of operations and financial conditions. We believe that a solid investment strategy in smart logistics parks and logistics information and communications technology are essential for scaling up our business operation as they are needed as logistics hubs to deepen our logistics network laid across PRC and that is critical for us to accelerate our growth and strengthen our competitive position in the future.
2
Critical Accounting Policies and Accounting Estimates
Revenue recognition
The Group follows the rules and guidance set out under ASC 606, Revenue from Contracts with Customers (“ASC 606”), since January 1, 2020 when recognizing revenue from contracts with customers. The core principle of ASC 606 requires an entity to recognize revenues to depict the transfer of goods or services to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods or services recognized as performance obligations are satisfied. In according with ASC 606, revenues are recognized when the Group satisfies the performance obligations by delivering the promised services to the customers, in an amount that reflects the consideration the Group expects to be entitled to in exchange for those services. The following five steps are applied to achieve that core principle:
Step 1: Identify the contract with the customer
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the performance obligations in the contract
Step 5: Recognize revenue when the company satisfies a performance obligation.
The Group generates revenues mainly from providing transportation services. The Group has elected to apply the practical expedient to apply ASC 606 at a portfolio level according to ASU 2014-09. Revenue recognition policies are as follow:
Transportation services
The Group derives its transportation service revenue by providing transportation services based on customers’ order. The performance obligation specified in customer orders is to transport customer’s goods on a shipment-by-shipment basis. The transaction price is predetermined mainly according to the distance of the transportation as well as the volume of the goods. The transportation revenue is recognized over time, which generally represents the transit period from origin to a destination by a trucker. The transit period can vary based on origin and destination, but usually can be fulfilled within one day to three days. Contracts still in transit at period end are not material. Generally, the credit term is within three months. There is no other obligation in our contracts, such as return, refund or warranties.
Fuzhou Feiyi also provides vehicle repair and maintenance services and sales of tires or spare parts to its customers and recognizes revenue at point in time as the Group completes the services or control transferred to the customers. These revenues were less than 1% and insignificant and were not separately presented in the combined statements of income.
Principal and Agent Considerations
In the Group’s transportation business, the Group utilizes independent contractors and third-party carriers in the performances of transportation services as and when needed. GAAP requires us to evaluate, using a control model, whether the Group itself promises to provide services to the customers (as a principal) or to arrange for services to be provided by another party (as an agent). Based on the Group’s evaluation using a control model, the Group determined that in all of its major business activities, it serves as a principal rather than an agent within their revenue arrangements. Revenue and the associated purchased transportation costs are both reported on a gross basis within the combined statements of income and comprehensive income.
3
Contract assets
A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If a company performs by transferring goods or services to a customer before the customer pays consideration or before a payment is due, a contract asset is recognized for the earned consideration that is unbilled. Contract assets are subject to impairment assessment.
The Group generally bills their customers in the following months. The Group’s contract assets contains earned but unbilled revenue associated with contract work that has been completed but not paid by customers, that are generally due once the transportation services are confirmed by both party and VAT invoice is issued. As of December 31, 2024 and June 30, 2025, the balance of contract assets was approximately RMB63.6 million and RMB48.7 million (US$6.8 million), respectively.
Contract liabilities
A contract liability is recognized when a payment is received or a payment is due (whichever is earlier) from a customer before the Group transfers the related services. Contract liabilities are recognized as revenue when the Group the services under the contract. As of December 31, 2024 and June 30, 2025, the balance of contract liabilities was RMB236,821 and RMB557,741 (US$77,858), respectively which were presented as “Advance from customers”. All contract liabilities were recognized as revenue in the following year/period.
Accounts receivable and allowance for expected credit loss of receivables
ASU 2016-13 replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to estimate credit losses. The adoption of ASU 2016-13 on January 1, 2023 did not have a material impact on our combined and consolidated financial statements and disclosures.
Accounts receivable are stated at their original invoiced amounts, net of an allowance for credit losses. Accounts are considered overdue after 90 days. The Group estimates credit losses on accounts receivable using the CECL model, considering factors such as historical collection experience, aging of receivables, customer credit history and financial condition, as well as current and forecasted economic and industry conditions. The adequacy of the allowance is reviewed regularly and adjusted when necessary. Account balances are written off against the allowance when collection is deemed remote and all collection efforts have been exhausted.
Loans that the Group has the intent and ability to hold for the foreseeable future or until maturity or payoff are carried at amortized cost, net of an allowance for credit losses, if any. Amortized cost includes the principal balance outstanding, net of any deferred loan fees and costs. Interest income is accrued on the unpaid principal balance, and accrued interest receivable is presented within “Loan and interest receivable from third-party suppliers” and “Loan receivable from controlling shareholder,” respectively, on the consolidated balance sheet. Credit losses on loans are estimated using the CECL model based on relevant internal and external factors, including borrower creditworthiness and macroeconomic conditions.
Impairment of long-lived assets
The Group reviews long-lived assets, including property, equipment and software, ROU assets and land use right, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the undiscounted future pre-tax cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Fair value is generally determined by discounting the cash flows expected to be generated by the asset (asset group), when the market prices are not readily available. The adjusted carrying amount of the asset is the new cost basis and is depreciated over the asset’s remaining useful life. Long-lived assets are grouped with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. For the year ended December 31, 2024 and the six months ended June 30, 2025, no impairment of long-lived assets were recognized.
The preparation of the financial statements requires the management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses, and related disclosures.
Critical accounting estimates are those estimates made in accordance with generally accepted accounting principles that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on the financial condition or results of operations of the Company.
For the year ended December 31, 2024 and the six months ended June 30, 2024 and 2025, respectively, the Company did not have any critical accounting estimates.
4
Results of Operations
Six months ended June 30, 2025 compared with six months ended June 30, 2024
The following table summarizes our combined results of operations of the Company and its wholly owned subsidiaries for the periods presented.
| For the six months ended June 30, | ||||||||||||
| 2024 | 2025 | 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| REVENUE | 298,661,805 | 332,805,659 | 46,457,879 | |||||||||
| COSTS AND EXPENSES | ||||||||||||
| Costs of revenue | 289,262,630 | 315,081,124 | 43,983,629 | |||||||||
| Selling and marketing expenses | 2,560,329 | 2,281,321 | 318,460 | |||||||||
| General and administrative expenses | 6,180,899 | 6,687,373 | 933,520 | |||||||||
| Total costs and expenses | (298,003,858 | ) | (324,049,818 | ) | (45,235,609 | ) | ||||||
| INCOME FROM OPERATIONS | 657,947 | 8,755,841 | 1,222,270 | |||||||||
| OTHER INCOMES | ||||||||||||
| Foreign exchange gain | - | 6,247 | 872 | |||||||||
| Other income (expenses) , net | 8,557 | (29,778 | ) | (4,157 | ) | |||||||
| Interest income (expenses), net | 1,928,062 | (581,615 | ) | (81,190 | ) | |||||||
| Total other income (expenses), net | 1,936,619 | (605,146 | ) | (84,475 | ) | |||||||
| INCOME BEFORE INCOME TAXES | 2,594,566 | 8,150,695 | 1,137,795 | |||||||||
| Income tax expense | (1,318,621 | ) | (2,321,199 | ) | (324,027 | ) | ||||||
| NET INCOME | 1,275,945 | 5,829,496 | 813,768 | |||||||||
| OTHER COMPREHENSIVE INCOME | ||||||||||||
| Foreign currency translation adjustments | (2,501,035 | ) | (242,776 | ) | (33,890 | ) | ||||||
| COMPREHENSIVE (LOSS) INCOME | (1,225,090 | ) | 5,586,720 | 779,878 | ||||||||
5
Revenue
We provide transportation services pursuant to our contract logistics business. Our major customers are usually based in the PRC and in the paper manufacturing, steel, coal and food industries.
We derived our revenue primarily from the provision of transportation services during the six months ended June 30, 2024 and 2025, respectively. Our revenue from the provision of transportation services increased from approximately RMB298.7 million for the six months ended June 30, 2024 to approximately RMB332.8 million (USD46.5 million) for the six months ended June 30, 2025, representing an increase of approximately 11.4%. The increase in our revenue from the provision of transportation services was primarily attributed to the increased needs and demands from customers, which in turn was generally attributed to the economic growth in the PRC during the period.
Revenue disaggregation
The Group primarily derives its transportation service revenue by providing transportation services based on customers’ order.
In respect of the Group’s revenues generated from providing transportation service, a substantial part of them were recognized from providing through third-party truckers to provide industrial raw materials or necessities line-haul transportation services for industrial customers, and there were no substantial difference in the nature, amount, timing and uncertainty of the revenues and cash flows among different industrial customers, regions, or between third-party truckers and the self-owned fleet.
Costs of Revenue
Our costs of revenue mainly consisted of cost of transportation services. The cost of transportation services comprises payments made to truck drivers through the payment and administrative service suppliers, depreciation expenses, employee wages and benefits, fuel cost and maintenance or insurance costs of vehicles.
Our costs of revenue increased from approximately RMB289.3 million to approximately RMB315.1 million (USD44.0 million) for the six months ended June 30, 2024 and 2025, respectively, representing an increase of approximately 8.9%. Over 96% of such costs of revenue for the six months ended June 30, 2024 and 2025, respectively, were logistics service charges incurred by using third-party truckers or self-owned fleet to provide transportation services to the Group’s customers, and in general, the amount of such logistics service charges was in line with the level of the Group’s transportation services. Therefore, the increase in the Group’s costs of revenue, which mainly consisted of the aforesaid logistics service charges, during the six months ended June 30, 2025 was generally in line with the increase in our revenue from the provision of transportation services during the same period. The remaining less than 4% of the Group’s costs of revenue for the six months ended June 30, 2024 and 2025, respectively, were primarily depreciation, fuel cost, maintenance or insurance costs of vehicles and others, and were insignificant.
Gross profit margin
Our gross profit margin increased from approximately 3.1% for the six months ended June 30, 2024 to approximately 5.3% for the six months ended June 30, 2025. The improvement was primarily attributable to both pricing and cost factors. In response to continued economic growth, the Company implemented targeted pricing strategies that resulted in higher margins for certain customers, supported by stronger demand and favorable market conditions. Although total cost of revenue increased during the period, the average rates charged by service suppliers declined, reflecting heightened competition among third-party truckers in the market. These factors, in combination, contributed to the overall improvement in gross profit margin for the current reporting period.
Selling and marketing expenses
Our selling and marketing expenses consist primarily of employee wages, rental expenses and benefits for sales staff, rental expense, depreciation expenses and other daily expenses which are related to the sales and marketing functions.
Our selling and marketing expenses decreased from approximately RMB2.6 million to approximately RMB2.3 million (US$0.3 million) for the six months ended June 30, 2024 and 2025, respectively, representing a decrease of approximately 10.9%. As we primarily targeted large institutional customers instead of retail ones, our selling expenses were insignificant in terms of amount and relative to our revenue. Its decrease over the said periods was primarily attributable to less business travels and social networking with existing or potential customers during 2025.
6
General and Administrative Expenses
Our general and administrative expenses consisted primarily of employee wages and benefits for corporate employees, office expenses, rental expenses, depreciation charge and other expenses which are related to the general corporate functions.
Our general and administrative expenses amounted to approximately RMB6.2 million and approximately RMB6.7 million (USD0.9 million) for the six months ended June 30, 2024 and 2025, respectively. For the six months ended June 30, 2024, our general and administrative expenses generally consisted of (i) salaries, employee benefits and travelling fees of approximately RMB2.8 million in aggregate; (ii) audit fees of approximately RMB1.6 million; (iii) depreciation costs and amortization of approximately RMB0.8 million in aggregate; (iv) general and office expenses of RMB0.9 million; and (v) others of RMB0.1 million. For the six months ended June 30, 2025, our general and administrative expenses generally consisted of (i) salaries, employee benefits and travelling fees of approximately RMB2.8 million in aggregate; (ii) audit fees of approximately RMB2.3 million; (iii) depreciation costs and amortization of approximately RMB0.6 million in aggregate; (iv) general and office expenses of RMB0.5 million; and (v) others of RMB0.5 million.
Income from operations
As a result of the foregoing, our income from operations increased from approximately RMB0.7 million to approximately RMB8.8 million (USD1.2 million) for the six months ended June 30, 2024 and 2025, respectively. It was mainly a combined effect of the increase in our revenue and increase in our general and administrative expenses over the said periods.
Total other income, net
Our total other income, net consisted of (i) foreign exchange gain; (ii) other expenses or income, net; and (iii) interest expenses or income, net for the six months ended June 30, 2024 and 2025, respectively. Our total other income, net decreased from approximately RMB1.9 million to approximately -RMB0.6 million (USD0.1 million) for the six months ended June 30, 2024 and 2025, respectively.
For the six months ended June 30, 2024 and 2025, respectively, (i) our foreign exchange gain was nil and RMB6,247; (ii) we recorded other income, net of approximately RMB8,557 and other expenses, net of approximately RMB29,778 (USD4,157); and (iii) our interest income, net decreased from approximately RMB1.9 million to approximately -RMB0.6 million (USD0.08 million) which primarily represented the loan interest income from our loans to our payment and administrative service suppliers and our controlling shareholder and both loans principal had fully repaid in 2024..
Income Tax Expense
Our income tax expenses increased from approximately RMB1.3 million to approximately RMB2.3 million (USD0.3 million) for the six months ended June 30, 2024 and 2025, respectively. This was primarily attributable to the increase in our taxable income. Our effective tax rate was approximately 50.8% and 28.5% for the six months ended June 30, 2024 and 2025, respectively. The lower effective tax rate for the six months ended June 30, 2025 was because while our income before income taxes was significantly higher for the six months ended June 30, 2024, and therefore the resulting income tax expense was proportionally lower when divided by our income before income taxes (which represented our effective tax rate) for the six months ended June 30, 2025.
Net Income
As a result of the foregoing, our net income increased from approximately RMB1.3 million to approximately RMB5.8 million (USD0.8 million) for the six months ended June 30, 2024 and 2025, respectively. Net profit margin was approximately 0.4% and 1.8% for the six months ended June 30, 2024 and 2025, respectively, due to the aforesaid reasons.
7
Liquidity, assets and liabilities
The following table set forth our current assets and current liabilities as of the dates indicated:
| As of | ||||||||||||
| December 31, 2024 | June 30, 2025 | June 30, 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Current Assets | ||||||||||||
| Cash | 10,522,943 | 3,277,379 | 457,504 | |||||||||
| Accounts receivable, net | 15,742,983 | 16,367,372 | 2,284,797 | |||||||||
| Contract assets | 63,584,323 | 48,728,479 | 6,802,233 | |||||||||
| Inventories | 334,937 | 332,633 | 46,434 | |||||||||
| Prepayments and other current assets | 7,065,310 | 29,588,683 | 4,130,421 | |||||||||
| Total current assets | 97,250,496 | 98,294,546 | 13,721,389 | |||||||||
| Current Liabilities | ||||||||||||
| Accounts payable | 9,607,647 | 1,541,081 | 215,127 | |||||||||
| Accrued expenses and other current liabilities | 9,933,441 | 11,205,693 | 1,564,253 | |||||||||
| Advances from customers | 236,821 | 557,741 | 77,858 | |||||||||
| Short-term bank loans | 31,000,000 | 31,000,000 | 4,327,433 | |||||||||
| Due to Controlling Shareholder | 1,290,837 | 4,983,711 | 695,699 | |||||||||
| Dividend payable | 59,800 | 58,073 | 8,107 | |||||||||
| Income tax payables | 2,667,477 | 1,365,801 | 190,658 | |||||||||
| Operating lease liabilities, current | 367,798 | 90,412 | 12,621 | |||||||||
| Total current liabilities | 55,163,821 | 50,802,512 | 7,091,756 | |||||||||
| Net current assets | 42,086,675 | 47,492,034 | 6,629,633 | |||||||||
Since its establishment, the Group has been generally financed by our net cash provided by operating activities, supported by bank loans and advances from our ultimate shareholder, Mr. Hue Kwok Chiu, when necessary.
As of June 30, 2025, our current assets exceed our current liabilities by approximately RMB47.5 million (USD6.6 million). We achieved net income of RMB5.8 million (USD0.8 million) for the six months ended June 30, 2025. Net cash used in operating activities was approximately RMB9.1 million (USD1.3 million) for the six months ended June 30, 2025. Historically, we have been able to generate sufficient operating cash to cover the current liabilities.
Subsequent to the reporting period ended 30 June 2025, the Company successfully completed its initial public offering and listed its shares on the Nasdaq Stock Market on October 15, 2025. The offering resulted in the issuance of 1,000,000 new ordinary shares and generated gross proceeds of USD5.0 million. This transaction represents a significant milestone in the Company’s development, enhancing its capital structure and providing additional liquidity to support future growth. Management intends to utilize the proceeds to strengthen the Company’s balance sheet, fund ongoing infrastructure investments, and pursue expansion into new markets. The IPO has also increased the Company’s visibility among global investors, which is expected to facilitate access to capital markets for future financing needs.
8
Short-term bank loans
| As of December 31, 2024 | As of June 30, 2025 | As of June 30, 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Guaranteed by Jiangxi JB and the couple of Ms. Gong Su Fang (the legal representative of Jiangxi JB)(1) | 5,000,000 | 5,000,000 | 697,973 | |||||||||
| Credit loan, no guarantee(2) | 3,000,000 | 3,000,000 | 418,784 | |||||||||
| Collateralized by real estate properties of Fuzhou JB and guaranteed by Ms. Gong Su Fang (the legal representative of Jiangxi JB)(3) | 13,000,000 | 13,000,000 | 1,814,730 | |||||||||
| Guaranteed by Jiangxi JB, a third-party financing guarantee company and Mr. Hue Kwok Chiu(4) | 5,000,00 | 5,000,000 | 697,973 | |||||||||
| Guaranteed by Jiangxi JB, Ms. Gong Su Fang (the legal representative of Jiangxi JB) and a third-party financing guarantee company(5) | 5,000,000 | 5,000,000 | 697,973 | |||||||||
| Total | 31,000,000 | 31,000,000 | 4,327,433 | |||||||||
| (1) | This bank loan will be due in December 2025. |
| (2) | In March 2025,, the Group fully repaid RMB 3,000,000 to the bank. In the same month, the Group entered into another loan agreement with the same bank of RMB 3,000,000 (fixed interest rate of 3.3% per annum) with a term of one-year and without any guarantee. |
| (3) | In June 2025, the Group fully repaid RMB 13,000,000 to the bank. In the same month, the Group entered into another loan agreement with the same bank of RMB 13,000,000 (fixed interest rate of 3.3675% per annum) with a term of one-year and same guarantee terms as above. |
| (4) | In August 2025, the Group fully repaid RMB 5,000,000 to the bank. In the same month, the Group entered into another loan agreement with the same bank of RMB 4,900,000 (fixed interest rate of 4.9% per annum) with a term of one-year and guaranteed by Jiangxi JB, third-party supplier A and Mr. Hue Kwok Chiu . |
| (5) | In April 2025, the Group entered into a revolving loan agreement of RMB 5,000,000 (fixed interest rate of 3.1% per annum) for one-year with a new bank guaranteed by Jiangxi JB, Ms. Gong Su Fang (the legal representative of Jiangxi JB) and a third-party financing guarantee company. |
The short-term bank loans outstanding as of December 31, 2024 and June 30, 2025 carried a weighted average interest rate of approximately 3.94% and 3.60%, respectively. The interest expenses of the short-term bank loans for the six months ended June 30, 2024 and 2025 were RMB 538,644 and RMB 585,225 (US$81,694) respectively, which were included as an item under interest income, net.
9
Shareholder borrowings and settlement
(1) Due to controlling shareholder
| Name of Related Party | Relationship | Nature | December 31, 2024 |
June 30, 2025 |
June 30, 2025 |
|||||||||||
| RMB | RMB | US$ | ||||||||||||||
| Mr. Hue Kwok Chiu | Sole and ultimate shareholder, Chairman and Chief Executive Officer | Advances for operational purposes | 1,290,837 | 4,983,711 | 695,699 | |||||||||||
The balance represented advances from the ultimate shareholder. The balances were unsecured, non-interest bearing and repayable on demand.
On May 31, 2024, Fuzhou JB, Jiabin HK and Mr. Hue Kwok Chiu entered into a tripartite deed (the “Deed”). Upon the completion of the Deed (see below Note (2)), Jiabin HK assumes to repay RMB123.27 million and the balance was reduced to RMB11 million.
During the period ended June 30, 2025, Jiabin HK borrowed approximately RMB 3.8 million from Mr. Hue Kwok Chiu and made no repayments during the period. As of October 31, 2025, the balance payable to Mr. Hue Kwok Chiu had increased to approximately RMB 7.0 million.
(2) Shareholder borrowing
During the year ended December 31, 2023, Mr. Hue, Kwok Chiu, our Chief Executive Officer and Chairman of the board of directors, borrowed RMB 120,000,000 in aggregate, from Fuzhou JB, our wholly owned subsidiary, which was for his personal use. All of such loans were secured by Jiabin HK’s balance due to Mr. Hue, Kwok Chiu from time to time, which was disclosed above, all carry interests at a simple rate of 3.55% per annum, and all repayable on December 31, 2023 under the original debt agreements (the “Debt Agreements”). As of December 31, 2023 and June 30, 2024, the balance of due from shareholder was RMB 121,471,741 and nil, respectively.
On December 14, 2023, Fuzhou JB, Mr. Hue, Kwok Chiu and Jiabin HK entered into a supplemental agreement pursuant to which it is agreed that, among other things, Mr. Hue, Kwok Chiu’s loans due to Fuzhou JB in the aggregate amount of RMB120,000,000 (US$ 16,901,647) and the carrying interests at a simple rate of 3.55% per annum will become repayable before December 31, 2024.
On May 31, 2024, Fuzhou JB, Jiabin HK and Mr. Hue Kwok Chiu entered into the Deed. Pursuant to the Deed, (i) Mr. Hue Kwok Chiu transfers his obligation under the Debt agreement to Jiabin HK, and Jiabin HK agrees to assume and repay any and all of liabilities of Mr. Hue Kwok Chiu under the Debt Agreements between Mr. Hue Kwok Chiu and Fuzhou JB in the aggregate amount of RMB120 million (US$16.5 million) and all accrued interest thereunder amounting to RMB3.27 million and (ii) Fuzhou JB agrees to seek repayment of these liabilities exclusively from Jiabin HK and not to seek repayment of any such liability from Mr. Hue Kwok Chiu. After completion of such transactions, Mr. Hue Kwok Chiu shall be deemed to have discharged his liabilities under the Debt Agreement.
On December 24, 2024, Fuzhou JB entered into a supplemental agreement pursuant to which it is agreed that, among other things, Jiabin HK’s loans due to Fuzhou JB in the aggregate amount of RMB120,000,000 (US$16,439,933) and the carrying interests at a simple rate of 3.55% per annum will become repayable before December 30, 2025.
10
Cash Flows
Comparison of six months ended June 30, 2024 and 2025
Our use of cash primarily related to operating activities and capital expenditure. We have historically financed our operations primarily through our cash flow generated from our operations. The following table sets forth a summary of our cash flows information for the years indicated:
| For the six months ended June 30, | ||||||||||||
| 2024 | 2025 | 2025 | ||||||||||
| RMB | RMB | US$ | ||||||||||
| Net cash provided by (used in) operating activities | 8,535,355 | (9,111,706 | ) | (1,271,946 | ) | |||||||
| Net cash (used in) investing activities | (17,478,879 | ) | (235,282 | ) | (32,844 | ) | ||||||
| Net cash provided by financing activities | 9,699,450 | 2,364,697 | 330,099 | |||||||||
| Effect of exchange rate changes | (114,353 | ) | (263,273 | ) | (36,751 | ) | ||||||
| Net increase / (decrease) in cash | 641,573 | (7,245,564 | ) | (1,011,442 | ) | |||||||
| Cash, beginning of period | 13,700,510 | 10,522,943 | 1,468,946 | |||||||||
| Cash, end of period | 14,342,083 | 3,277,379 | 457,504 | |||||||||
Operating activities
Our cash inflow from operating activities was principally from the revenue from transportation services, while our cash outflow used in operating activities principally consisted of payments for logistics services, maintenance service, staff costs, and other costs and expenses.
Net cash provided by operating activities reflects our net profit adjusted for (i) non-cash item, namely depreciation and amortization of our property, equipment and software, amortization of land use right and right-of-use assets, deferred income tax, foreign exchange loss or gain; and (ii) the effects of changes in operating assets and liabilities, which mainly comprised our accounts receivable, interest receivable, contract assets and accounts payable, for the six months ended June 30, 2024 and 2025, respectively.
11
Net cash provided by operating activities was approximately RMB8.5 million for the six months ended June 30, 2024 which comprised our net income of approximately RMB1.3 million (US$0.2 million) and primary adjustments and changes of (i) depreciation and amortization of property, equipment and software of approximately RMB0.9 million (US$0.1 million); (ii) an increase in accounts receivable of approximately RMB2.8 million (US$0.4 million); (iii) a decrease in interest receivable of approximately RMB2.5 million (US$0.3 million); (iv) a decrease in contract assets of approximately RMB15.5 million (US$2.1 million); and (v) a decrease in accounts payable of approximately RMB10.0 million (US$1.4 million), among other things.
Net cash used in operating activities was approximately RMB9.1 million for the six months ended June 30, 2025 which comprised our net income of approximately RMB5.8 million and primary adjustments and changes of (i) depreciation and amortization of property, equipment and software of approximately RMB0.8 million; (ii) an increase in accounts receivable of approximately RMB0.6 million; (iii) an increase in prepaid expenses and other current assets of approximately RMB22.5 million; (iv) a decrease in accounts payable of approximately RMB8.1 million; (v) a decrease in contract assets of approximately RMB14.9 million; and (vi) an increase in accrued expenses and other current liabilities of approximately RMB1.3 million, among other things.
Investing activities
Our cash used in investing activities was principally for the purchase of property, equipment and software, and loan to third parties.
Net cash used in investing activities was approximately RMB17.5 million (US$2.4 million) for the six months ended June 30, 2024, which mainly consisted of loan provided to third-party suppliers of RMB25.0 million (US$3.4 million), offset with repayment of loans from third-party suppliers of approximately RMB7.7 million (US$1.1 million).
Net cash used in investing activities was approximately RMB0.2 million (US$0.03 million) for the six months ended June 30, 2025, which mainly consisted of purchasing property, equipment and software.
Financing activities
Net cash provided by financing activities was approximately RMB9.7 million for the six months ended June 30, 2024, which was primarily attributable loan received from the bank of RMB21.0 million and to amount received from the controlling shareholder of approximately RMB4.6 million being offset by repayment of bank loan of RMB13.0 million, payment of deferred issuance cost of approximately RMB1.6 million and amount repaid to the controlling shareholder of approximately RMB1.3 million .
Net cash provided by financing activities was approximately RMB2.4 million (US$0.3 million) for the six months ended June 30, 2025, which was primarily attributable to loan received from the bank of approximately RMB21.0 million (US$2.9 million) and amount received from the controlling shareholder of approximately RMB3.7 million (US$0.5 million)being offset by repayment of bank loan of approximately RMB21.0 million (US$2.9 million), and payment of deferred issuance cost of approximately RMB1.3 million (US$0.2 million).
Cash
The Company’s subsidiaries in PRC conduct their businesses in the local currency, Renminbi (RMB), as their functional currency and reporting currency.
We had cash of RMB10.5 million and RMB3.3 million as of December 31, 2024 and June 30, 2025, respectively. The cash disaggregated by currency denomination are as follow:
| As of December 31, 2024 | As of June 30, 2025 | |||||||||||||||
| Amount | RMB equivalent | Amount | RMB equivalent | |||||||||||||
| Cash: | ||||||||||||||||
| HK$ | 167,410 | 157,315 | 51,385 | 46,915 | ||||||||||||
| US$ | 116 | 772 | 111 | 775 | ||||||||||||
| RMB | 10,364,856 | 10,364,856 | 3,229,689 | 3,229,689 | ||||||||||||
| Total | 10,522,943 | 3,277,379 | ||||||||||||||
12
In managing our liquidity risk, we monitor and maintain a level of cash and cash equivalents deemed adequate by our management to finance our operations and mitigate the effects of unexpected fluctuations in cash flows. We regularly monitor the repayment dates of financial liabilities, including accounts payable, other payables and accrued charges, etc. to match with financial resources available to us from time to time. We manage liquidity risk by maintaining adequate financial resources, including existing cash and bank balances and operating cash flows.
We currently expect that there will not be any material change in the sources and uses of cash, except that we would have additional cash outflow for payment of listing expenses.
Accounts Receivable and contract assets
Accounts receivable is recognized and carried at original invoiced amount less an estimated allowance for credit losses. We determine the adequacy of reserves for doubtful accounts based on individual account analysis and historical collection trend. We establish a provision for doubtful receivables when there is objective evidence that we may not be able to collect amounts due. The allowance is based on management’s best estimate of specific losses on individual exposures, as well as a provision on historical trends of collections. Actual amounts received may differ from management’s estimate of credit worthiness and the economic environment. Delinquent account balances are written-off against the allowance for credit losses after management has determined that the likelihood of collection is not probable.
A contract asset is the right to consideration in exchange for goods or services transferred to the customer. If a company performs by transferring goods or services to a customer before the customer pays consideration or before a payment is due, a contract asset is recognized for the earned consideration that is unbilled. Contract assets are subject to impairment assessment. The Group generally bills their customers in the following months. The Group’s contract assets contain earned but unbilled revenue associated with contract work that has been completed but not paid by customers, that are generally due once the transportation services are confirmed by both parties and VAT invoice is issued.
As of June 30, 2025, the balances of accounts receivable and contract assets increased by 4.0% and decreased by 23.4%, respectively, compared with that as of December 31, 2024. As of June 30, 2024, the aging of all accounts receivable balance is within one year, and there was no allowance recorded as the Company considers all of the accounts receivable fully realizable.
As of the date of this report, approximately RMB16.4 million or approximately 98.2% of the Group’s accounts receivable, net as of June 30, 2025 has been collected by the Group.
13
Exhibit 99.3
Smart Logistics Global Limited Reports First Half of 2025 Financial Results
Hong Kong, December 19, 2025 (GLOBE NEWSWIRE) -- Smart Logistics Global Limited (Nasdaq: SLGB) (the “Company”), a Hong Kong-based business-to-business contract logistics solution provider, today reported its financial results for the six months ended June 30, 2025.
Financial highlights
| ● | Revenues for the six months ended June 30, 2025 increased 11.4% to RMB332.8 million (US$46.5 million), compared to RMB298.7 million for the same period in 2024. The increase in the Company’s revenue from the provision of transportation services was primarily attributed to the increased needs and demands from customers, which in turn was generally attributed to the economic growth in the PRC during the period. |
| ● | Income from operations for the six months ended June 30, 2025 was RMB8.8 million (US$1.2 million), compared to RMB0.7 million for the same period in 2024. The increase in income from operations was mainly a combined effect of the increase in our revenue and increase in our general and administrative expenses over the said periods. |
| ● | Net Income for the six months ended June 30, 2025 was RMB5.8 million (US$0.8 million) or RMB0.15 a share, compared to RMB1.3 million or RMB0.03 a share for the same period in 2024. |
Recent Operational Highlights
| ● | Subsequent to the reporting period ended June 30, 2025, the Company listed its ordinary shares on the Nasdaq Stock Market on October 15, 2025 and completed its initial public offering on October 16, 2025. The offering resulted in the issuance of 1,000,000 new ordinary shares and generated gross proceeds of $5.0 million. This transaction represents a significant milestone in the Company’s development, enhancing its capital structure and providing additional liquidity to support future growth. |
| ● | The Company’s gross profit margin increased to approximately 5.3% for the six months ended June 30, 2025, compared to 3.1% for the six months ended June 30, 2024. The improvement was primarily attributable to both pricing and cost factors. In response to continued economic growth, the Company implemented targeted pricing strategies that resulted in higher margins for certain customers, supported by stronger demand and favorable market conditions. |
Hue Kwok Chiu, Chief Executive Officer and Chairman of the Company, stated, “This is a very exciting time for us, given this is our first financial report since becoming a publicly traded company. I want to thank our dedicated employees and partners for their efforts which contributed to our top and bottom line growth and increasing our profit margins.”
“We are focusing our efforts on growing our contract logistics business by selecting the good truckers and trucks for our customers and establishing steady and reciprocal relationships with truckers through repeated transactions with us through our suppliers. The number of truckers registered in our TMS increased from approximately 130,000 in December 2024 to over 140,000 now and we continue to expand,” concluded Hue Kwok Chiu.
About Smart Logistics Global Limited
Since 2018, the Company has been a business-to-business (B2B) contract logistics provider in China, focusing on industrial raw materials transportation. The Company offers tailored, cost-efficient logistics solutions primarily through land-only transportation services for large institutional clients with long-term contracts. By leveraging its proprietary Transportation Management System to optimize routes and equipment, the Company also commits to a scalable model via investments in advanced logistics infrastructure, including its 110,000-square-meter smart logistics park in Jiangxi Province and 7 full-truck load centres strategically located in China, which effectively enhances its operations and growth potential. For more information, please visit: https://www.smartlogisticsglobal.com/.
Forward-Looking Statement
This press release contains forward-looking statements. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as “may, “will, “intend,” “should,” “believe,” “expect,” “anticipate,” “project,” “estimate” or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company’s expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the uncertainties related to market conditions, and other factors discussed in the “Risk Factors” section of the registration statement filed with the SEC. For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company’s filings with the SEC, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.
Investor Relations Contact
Andrew Barwicki
516-662-9461 / [email protected]