Jerash Holdings US Inc
For the period ended Dec 31, 2024. Filed Feb 12, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 31, 2024 · Filed Feb 12, 2025
JRSH$6.10+3.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-13.
0001213900-24-097454
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-12-31; filed 2025-02-12.
0001213900-25-012363
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 73 previous paragraphs and 74 current paragraphs.
34 unchanged; 34 reworded; 6 added; 5 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 15 previous and 15 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (6)
Current report
***Revenue.***Revenue increased by approximately $7.9 million, or 29%, to $35.4 million, for the three months ended December 31, 2024, from approximately $27.5 million for the same period in fiscal 2024. The increase was mainly due to an increase in shipments to two of our major customers and another export customer in the U.S., which is one of our major export markets.
Current report
During the three months ended December 31, 2024, aggregate sales to China and Hong Kong, Germany, Jordan, and other locations decreased by 15% from $5.1 million to $4.3 million from the same period last year. This decrease was mainly because more production capacity was allocated to U.S. export orders and less local sub-contracting orders were fulfilled in the period.
Current report
For the three months ended December 31, 2023, we purchased 17% and 14% of our total purchase in garments and raw materials from two suppliers, respectively.
Current report
Nine months ended December 31, 2024 and 2023
Current report
Nine months ended December 31, 2024 and 2023
Current report
For the nine months ended December 31, 2023, the cash provided by operating activities was primarily attributable to a decrease of $16.7 million in inventory, offsetting an increase of $6.0 million in accounts receivable and a decrease of $3.4 million in accounts payable.
Removed paragraphs (5)
Previous report
Revenue. Revenue increased by approximately $6.9 million, or 21%, to $40.2 million, for the three months ended September 30, 2024, from approximately $33.4 million for the same period in fiscal 2024. The increase was mainly due to more shipments to our two major customers in the U.S. with some customers we obtained during the past two years.
Previous report
For the three months ended September 30, 2023, we did not have a major supplier for our garments and raw materials.
Previous report
Six months ended September 30, 2024 and 2023
Previous report
During the six months ended September 30, 2024, aggregate sales to China, Germany, Jordan, and other locations increased by 55% from approximately $6.2 million to $9.6 million from the same period last year as we were diversifying our customer bases to different geographic locations.
Previous report
Six months ended September 30, 2024 and 2023
Reworded paragraphs (34)
Previous wording
The increase of approximately 18% in sales to the U.S. during the three months ended September 30, 2024, was mainly attributable to more shipments delivered to our major customers in the U.S.
Current wording
The increase of approximately 39% in sales to the U.S. during the three months ended December 31, 2024, was mainly attributable to increases in shipments to two of our major customers and another export customer in the U.S.
Previous wording
Cost of goods sold. Following the increase in sales revenue, our cost of goods sold increased by approximately $5.2 million, or 19%, to approximately $33.2 million, for the three months ended September 30, 2024, from approximately $28.0 million for the same period in fiscal 2024. As a percentage of revenue, the cost of goods sold decreased by approximately two percentage points, from 84% for the same period in fiscal 2024 to 82% for the three months ended September 30, 2024. The decrease in the cost of goods sold as a percentage of revenue was primarily attributable to economy of scale resulting from higher production volume and more shipments.
Current wording
Cost of goods sold. Following the increase in sales revenue, our cost of goods sold increased by approximately $6.9 million, or 30%, to approximately $30.0 million, for the three months ended December 31, 2024, from approximately $23.1 million for the same period in fiscal 2024. As a percentage of revenue, the cost of goods sold increased by approximately 1 percentage point, from 84% for the same period in fiscal 2024 to 85% for the three months ended December 31, 2024. The increase in the cost of goods sold as a percentage of revenue was primarily attributable to higher import costs resulted from the geopolitical turmoil in the region.
Previous wording
For the three months ended September 30, 2024, we purchased 10% of our total purchase in garments and raw materials from one major supplier.
Current wording
For the three months ended December 31, 2024, we purchased 14% of our total purchase in garments and raw materials from one major supplier.
Previous wording
Gross profit margin. Gross profit margin was approximately 18% for the three months ended September 30, 2024, which increased by two percentage points from approximately 16% for the same period in fiscal 2024. The increase in gross profit margin was primarily driven by higher production volume with more orders shipped to the U.S. that typically generate higher margin.
Current wording
Gross profit margin. Gross profit margin was approximately 15% for the three months ended December 31, 2024, which decreased by 1 percentage point from approximately 16% for the same period in fiscal 2024. The decrease in gross profit margin was primarily driven by higher logistic costs for imports arisen from the geopolitical turmoil in the region.
Previous wording
***Operating expenses.***Operating expenses increased by 32%, or approximately $1.4 million, from approximately $4.5 million for the three months ended September 30, 2023, to approximately $5.9 million for the three months ended September 30, 2024. The increase was primarily due to higher export logistic costs to catch up with garment shipment schedules of customers, higher shipment volume and more stock-based compensation expenses in the second quarter of fiscal 2025.
Current wording
Operating expenses. Operating expenses increased by 14%, or approximately $0.6 million, from approximately $4.1 million for the same period in fiscal 2024, to approximately $4.7 million for the three months ended December 31, 2024. The increase was primarily due to the increase in export logistic costs from the increase of 29% in sales and the increase of $231,000 in stock-based compensation expenses.
Previous wording
Other expenses, net. Other expenses, net were approximately $364,000 for the three months ended September 30, 2024, as compared to other expenses, net of approximately $167,000 for the same period in fiscal 2024. The increase was primarily due to higher interest expenses from customers’ supply chain financing programs and bank financing to support raw material purchases for the shipments in the latter half of the fiscal year.
Current wording
Other expenses, net. Other expenses, net were approximately $252,000 for the three months ended December 31, 2024, as compared to other expenses, net of approximately $105,000 for the same period in fiscal 2024. The increase was primarily due to an increase in interest expenses arisen from supply chain financing programs provided by our major customers.
Previous wording
***Income tax expenses.***Income tax expenses for the three months ended September 30, 2024, were approximately $106,000 compared to income tax expenses of approximately $352,000 for the same period in fiscal 2024. The decrease in the income tax expenses was mainly due to the reduced operating profit derived from our Jordan subsidiaries and improvement in Hong Kong subsidiaries. The effective tax rate declined to 13.7% for the three months ended September 30, 2024, as compared to 48.8% for the three months ended September 30, 2023.
Current wording
***Income tax expenses.***Income tax expenses for the three months ended December 31, 2024, were approximately $450,000 compared to income tax expenses of approximately $39,000 for the same period in fiscal 2024. The increase in the income tax expenses was mainly due to a tax provision adjustment of approximately $274,000 in GILTI, primarily resulting from the retroactive reinstatement of the subpart F income that was enacted for the fiscal years ended March 31, 2023 and 2022. The effective tax rate increased to 98.6% for the three months ended December 31, 2024, as compared to 14.2% for the same period in fiscal 2024.
Previous wording
Net income. Net income for the three months ended September 30, 2024, was approximately $0.7 million compared to net income of approximately $0.4 million for the same period in fiscal 2024. The increase in net income was mainly attributable to the increase in gross profit and the decrease in income tax expenses.
Current wording
Net income. Net income for the three months ended December 31, 2024, was approximately $6,000 compared to net income of approximately $232,000 for the same period in fiscal 2024. The decrease in net income was mainly attributable to the increase in stock-based compensation expenses, as well as the tax provision adjustment in GILTI offsetting the increase in gross profit.
Previous wording
The following table summarizes the results of our operations during the six-month periods ended September 30, 2024 and 2023, and provides information regarding the dollar and percentage increase or (decrease) during such periods.
Current wording
The following table summarizes the results of our operations during the nine-month periods ended December 31, 2024 and 2023, and provides information regarding the dollar and percentage increase or (decrease) during such periods.
Previous wording
Revenue. Revenue increased by approximately $13.1 million, or 19%, to $81.2 million, for the six months ended September 30, 2024, from approximately $68.1 million for the same period in fiscal 2024. The increase was mainly due to more shipments to one of our major customers in the U.S.
Current wording
Revenue. Revenue increased by approximately $20.9 million, or 22%, to $116.6 million, for the nine months ended December 31, 2024, from approximately $95.6 million for the same period in fiscal 2024. The increase was mainly due to the increase in shipments to one of our major customers in the U.S. and another export customer in the U.S., which is one of our major export markets.
Previous wording
The following table outlines the dollar amount and percentage of total sales to our customers for the six months ended September 30, 2024 and 2023, respectively.
Current wording
The following table outlines the dollar amount and percentage of total sales to our customers for the nine months ended December 31, 2024 and 2023, respectively.
Previous wording
The increase of approximately 16% in sales to the U.S. during the six months ended September 30, 2024, was mainly attributable to the increase of shipment to one of our major customers in the U.S. with some customers we obtained during the past two years.
Current wording
The increase of approximately 22% in sales to the U.S. during the nine months ended December 31, 2024, was mainly attributable to more goods being shipped to one of our major customers and another export customer in the U.S.
Previous wording
During the three months ended September 30, 2024, aggregate sales to China, Germany, Jordan, and other locations increased by 38% from $4.1 million to $5.7 million from the same period last year. This increase was mainly due to higher demands of our production facility in the period.
Current wording
During the nine months ended December 31, 2024, aggregate sales to China and Hong Kong, Germany, Jordan, and other locations increased by 23% from approximately $11.3 million to $13.9 million from the same period last year due to higher demands of our production capacities from those regions in the nine months period.
Previous wording
Cost of goods sold. Following the increase in sales revenue, our cost of goods sold increased by approximately $12.3 million, or 22%, to approximately $69.5 million, for the six months ended September 30, 2024, from approximately $57.2 million for the same period in fiscal 2024. As a percentage of revenue, the cost of goods sold increased by approximately 2% points to 86% for the six months ended September 30, 2024 from 84% for the same period in fiscal 2024. The increase in cost of goods sold as a percentage of revenue was primarily attributable to the higher import logistic costs and more overtime work incurred in the first quarter to catch up with the garment delivery schedules of customers.
Current wording
Cost of goods sold. Following the increase in sales revenue, our cost of goods sold increased by approximately $19.3 million, or 24%, to approximately $99.5 million, for the nine months ended December 31, 2024, from approximately $80.2 million for the same period in fiscal 2024. As a percentage of revenue, the cost of goods sold increased by approximately one percentage point to 85% for the nine months ended December 31, 2024 from 84% for the same period in fiscal 2024. The increase in cost of goods sold as a percentage of revenue was primarily attributable to the higher import costs for raw materials and higher labor costs in overtime work resulted from the logistic issues arisen from the geopolitical turmoil in the region.
Previous wording
For the six months ended September 30, 2024 and 2023, we purchased 11% of our garments and raw materials from one major supplier.
Current wording
For the nine months ended December 31, 2024 and 2023, we purchased 12% and 13%, respectively, of our total purchase in garments and raw materials from one major supplier.
Previous wording
Gross profit margin. Gross profit margin was approximately 14% for the six months ended September 30, 2024, which decreased by 2% points from 16% for the same period in fiscal 2024. The decrease in gross profit margin was primarily driven by higher logistic costs and over time work incurred in the first quarter to catch up with garment delivery schedules of customers.
Current wording
Gross profit margin. Gross profit margin was approximately 15% for the nine months ended December 31, 2024, which decreased by one percentage point from 16% for the same period in fiscal 2024. The decrease in gross profit margin was primarily driven by higher logistic costs for import and labor costs in overtime work arisen from the geopolitical turmoil in the region.
Previous wording
***Operating expenses.***Operating expenses for the six months ended September 30, 2024 increased by 27%, or approximately $2.4 million, to approximately $11.4 million, compared to the same period in fiscal 2024. The increase was primarily due to higher export logistic costs from more sales in the period and higher stock-based compensation expenses in fiscal 2025.
Current wording
***Operating expenses.***Operating expenses for the nine months ended December 31, 2024 increased by 23%, or approximately $3.0 million, to approximately $16.1 million, compared to the same period in fiscal 2024. The increase was primarily due to higher export logistic costs attributable to more shipments and the geopolitical turmoil in the region, and also an increase of $0.7 million in stock-based compensation expenses.
Previous wording
Other expenses, net. Other expenses, net was approximately $790,000 for the six months ended September 30, 2024, as compared to other expenses, net of approximately $466,000 for the same period in fiscal 2024. The increase was primarily due to higher interest expenses from customers’ supply chain financing programs.
Current wording
Other expenses, net. Other expenses, net was approximately $1.0 million for the nine months ended December 31, 2024, as compared to other expenses, net of approximately $571,000 for the same period in fiscal 2024. The increase was primarily due to higher interest expenses from the supply chain financing programs of our customers.
Previous wording
***Income tax expenses.***Income tax expenses for the six months ended September 30, 2024 were approximately $0.2 million compared to income tax expenses of approximately $0.7 million for the same period in fiscal 2024. The decrease in the income tax expenses was mainly due to the reduced operating profit derived from our Jordan subsidiaries. The effective tax rate was declined to (44.9%) for the six months ended September 30, 2024, as compared to 42.9% for the six months ended September 30, 2023.
Current wording
***Income tax expenses.***Income tax expenses for the nine months ended December 31, 2024 were approximately $667,000 compared to income tax expenses of approximately $689,000 for the same period in fiscal 2024. The decrease in the income tax expenses was mainly due to the reduced operating profit derived from our Jordanian subsidiaries offsetting by the tax provision adjustment of $274,000 in GILTI, primarily resulting from the retroactive reinstatement of the subpart F income that was enacted for the fiscal years ended March 31, 2023 and 2022. The effective tax rate declined to (2,339.6%) for the nine months ended December 31, 2024, as compared to 38.6% for the nine months ended December 31, 2023.
Previous wording
Net (loss)/income. Net loss for the six months ended September 30, 2024 was approximately $0.7 million compared to net income of approximately $0.9 million for the same period in fiscal 2024. The decrease in net income was mainly attributable to a decrease in profit margin due to the higher logistic costs amid the Red Sea turmoil and additional production costs to catch up with customers’ delivery schedules, as well as the higher stock-based compensation expenses during the period in fiscal 2025.
Current wording
Net (loss)/income. Net loss for the nine months ended December 31, 2024 was approximately $0.7 million compared to net income of approximately $1.1 million for the same period in fiscal 2024. The decrease in net income was mainly attributable to a decrease in profit margin due to higher logistics costs amid the Red Sea turmoil and additional production cost to catch up with customers’ delivery schedules, the higher stock-based compensation expenses during the period in fiscal 2025, as well as the tax provision adjustment in GILTI.
Previous wording
As of September 30, 2024, we had cash of approximately $16.3 million and restricted cash of approximately $1.5 million compared to cash of approximately $12.4 million and restricted cash of approximately $1.6 million as of March 31, 2024. The increase in total cash was mainly a result of more sales in the six-month period and a higher credit facility balance.
Current wording
As of December 31, 2024, we had cash of approximately $13.2 million and restricted cash of approximately $1.6 million compared to cash of approximately $12.4 million and restricted cash of approximately $1.6 million as of March 31, 2024. The increase in total cash was mainly a result of more sales in the period and a net increase in short-term bank financing.
Previous wording
Our current assets as of September 30, 2024 were approximately $51.6 million and our current liabilities were approximately $16.4 million, which resulted in a ratio of approximately 3.1 to 1. Our current assets as of March 31, 2024 were approximately $50.9 million, and our current liabilities were approximately $14.8 million, which resulted in a current ratio of approximately 3.4 to 1.
Current wording
Our current assets as of December 31, 2024 were approximately $51.1 million and our current liabilities were approximately $16.3 million, which resulted in a ratio of approximately 3.1 to 1. Our current assets as of March 31, 2024 were approximately $50.9 million, and our current liabilities were approximately $14.8 million, which resulted in a current ratio of approximately 3.4 to 1.
Previous wording
The primary drivers in the increase in current assets were the increase in cash from more sales in the six-month period. The primary driver in the increase in current liabilities was the increase in credit facilities balance.
Current wording
The primary drivers in the increase in current assets were the increase in cash from more sales in the period and an increase in short-term bank financing. The primary driver in the increase in current liabilities was an increase in short-term bank financing.
Previous wording
Total equity as of September 30, 2024 was approximately $63.5 million compared to $64.4 million as of March 31, 2024.
Current wording
Total equity as of December 31, 2024 was approximately $63.2 million compared to $64.4 million as of March 31, 2024.
Previous wording
We had net working capital of $35.2 million and $36.1 million as of September 30, 2024 and March 31, 2024, respectively. Based on our current operating plan, we believe that cash on hand and cash generated from operating activities will be sufficient to support our working capital needs for the next 12 months from the date this Quarterly Report is released.
Current wording
We had net working capital of $34.8 million and $36.1 million as of December 31, 2024 and March 31, 2024, respectively. Based on our current operating plan, we believe that cash on hand and cash generated from operating activities will be sufficient to support our working capital needs for the next 12 months from the date this Quarterly Report is released.
Previous wording
Pursuant to the DBS facility letter dated January 12, 2022, DBSHK provided a bank facility of up to $5.0 million to Treasure Success, which was amended pursuant to a facility letter dated January 4, 2024. Pursuant to the amended agreement, DBSHK agreed to finance cargo receipt, trust receipt, account payable financing, and certain types of import and export invoice financing up to an aggregate of $5.0 million, subject to certain financial covenants. The DBSHK facility bears interest at 1.5% per annum over HIBOR for HKD bills and 1.1% to 1.3% per annum over DBSHK’s cost of funds for foreign currency bills. The facility is guaranteed by Jerash Holdings and became available to the Company on June 17, 2022. As of September 30, 2024 and March 31, 2024, we had $3.6 million and $nil outstanding under this DBSHK facility, respectively.
Current wording
Pursuant to the DBS facility letter dated January 12, 2022, DBSHK provided a bank facility of up to $5.0 million to Treasure Success, which was amended pursuant to a facility letter dated January 4, 2024. Pursuant to the amended agreement, DBSHK agreed to finance cargo receipt, trust receipt, account payable financing, and certain types of import and export invoice financing up to an aggregate of $5.0 million, subject to certain financial covenants. The DBSHK facility bears interest at 1.5% per annum over HIBOR for HKD bills and 1.1% to 1.3% per annum over DBSHK’s cost of funds for foreign currency bills. The facility is guaranteed by Jerash Holdings and became available to the Company on June 17, 2022. As of December 31, 2024 and March 31, 2024, we had $5.0 million and $nil outstanding under this DBSHK facility, respectively.
Previous wording
Net cash provided by operating activities was approximately $2.4 million for the six months ended September 30, 2024, compared to cash provided by operating activities of approximately $8.2 million for the same period in fiscal 2024. The decrease in net cash provided by operating activities was primarily attributable to the following factors:
Current wording
Net cash used in operating activities was approximately $581,000 for the nine months ended December 31, 2024, compared to cash provided by operating activities of approximately $7.9 million for the same period in fiscal 2024. For the nine months ended December 31, 2024, the decrease in net cash provided by operating activities was primarily attributable to the forecasted increased shipments in the subsequent quarters, summarized with the following factors:
Previous wording
Net cash used in investing activities was approximately $0.9 million for the six months ended September 30, 2024, compared to approximately $3.5 million in the same period in fiscal 2024. The net cash used in investing activities during the six months ended September 30, 2024 was mainly for investment in property, plant, and machinery and construction of a dormitory. The net cash used in investing activities in the six months ended September 30, 2023 was mainly used in investment in property, plant, and machinery including the ongoing construction of a dormitory and factory expansion.
Current wording
Net cash used in investing activities was approximately $1.7 million for the nine months ended December 31, 2024, compared to approximately $4.3 million in the same period in fiscal 2024. The net cash used in investing activities during the nine months ended December 31, 2024 was mainly for investment in property, plant, and machinery and construction of a dormitory. The net cash used in investing activities in the nine months ended December 31, 2023 was mainly used in investment in property, plant, and machinery including the ongoing construction of a dormitory and factory expansion.
Previous wording
Net cash provided by financing activities was approximately $2.3 million for the six months ended September 30, 2024, which was the net effect of proceeds from the DBSHK facility of approximately $3.6 million and the payments of $1.2 million of dividend. Net cash used in financing activities was approximately $1.2 million for the six months ended September 30, 2023, which was dividend payments in the period.
Current wording
Net cash provided by financing activities was approximately $3.1 million for the nine months ended December 31, 2024, which was the net effect of proceeds from the DBSHK facility of approximately $5.0 million and the payments of $1.8 million of dividend. Net cash used in financing activities was approximately $1.8 million for the nine months ended December 31, 2023, which was dividend payments in the period.
Previous wording
In accordance with the corporate law in Jordan, subsidiaries of Jerash Holdings in Jordan are required to make appropriations to certain reserve funds, based on net income determined in accordance with generally accepted accounting principles of Jordan. Appropriations to the statutory reserve are required to be 10% of net income until the reserve is equal to 100% of the entity’s share capital. Jiangmen Treasure Success is required to set aside 10% of its net income as statutory surplus reserve until such reserve is equal to 50% of its registered capital. These reserves are not available for dividend distribution. The statutory reserve was $0.4 million as of September 30, 2024 and 2023.
Current wording
In accordance with the corporate law in Jordan, subsidiaries of Jerash Holdings in Jordan are required to make appropriations to certain reserve funds, based on net income determined in accordance with generally accepted accounting principles of Jordan. Appropriations to the statutory reserve are required to be 10% of net income until the reserve is equal to 100% of the entity’s share capital. Jiangmen Treasure Success is required to set aside 10% of its net income as statutory surplus reserve until such reserve is equal to 50% of its registered capital. These reserves are not available for dividend distribution. The statutory reserve was $0.4 million and $0.4 million as of December 31, 2024 and 2023, respectively.
Previous wording
Total restricted net assets accounted for approximately 0.65% of our consolidated net assets as of September 30, 2024. As our subsidiaries in Jordan are only required to set aside 10% of net profits to fund the statutory reserves, we believe the potential impact of such restricted net assets on our liquidity is limited.
Current wording
Total restricted net assets accounted for approximately 0.66% of our consolidated net assets as of December 31, 2024. As our subsidiaries in Jordan are only required to set aside 10% of net profits to fund the statutory reserves, we believe the potential impact of such restricted net assets on our liquidity is limited.
Previous wording
We had capital expenditures of approximately $0.9 million and $3.5 million for the six months ended September 30, 2024 and 2023, for plant and machinery and the construction of a dormitory in both periods. For the six months ended September 30, 2024, payments for additional plant and machinery and the construction of a dormitory amounted to approximately $0.6 million and $0.3 million respectively. For the six months ended September 30, 2023, payments for additional plant and machinery, and construction of a dormitory and factory expansion, amounted to approximately $0.9 million and $2.6 million, respectively.
Current wording
We had capital expenditures of approximately $1.7 million and $4.3 million for the nine months ended December 31, 2024 and 2023, for plant and machinery and the construction of a dormitory in both periods. For the nine months ended December 31, 2024, payments for additional plant and machinery and the construction of a dormitory amounted to approximately $1.1 million and $0.6 million respectively. For the nine months ended December 31, 2023, payments for additional plant and machinery, and construction of a dormitory and factory expansion, amounted to approximately $1.1 million and $3.2 million, respectively.
Previous wording
On August 7, 2019, we completed a transaction to acquire 12,340 square meters (approximately three acres) of land in Al Tajamouat Industrial City, Jordan, from a third party to construct a dormitory for our employees with aggregate purchase price JOD 863,800 (approximately $1,218,303). Management has revised the plan to construct both dormitory and production facilities on the land in order to capture the increasing demand for our capacity. We are conducting engineering design and study on this project with the business growth potential brought about by the new business collaboration with Busana Apparel Group. On February 6, 2020, we completed a transaction to acquire 4,516 square meters (approximately 48,608 square feet) of land in Al Tajamouat Industrial City, Jordan, from a third party to construct a dormitory for our employee with aggregate purchase price JOD 313,501 (approximately $442,162). The dormitory is completed in second quarter of fiscal year 2025. We have spent approximately $9.8 million in capital expenditures to build the dormitory. The dormitory’s kitchen is under construction at an estimated cost of approximately $0.9 million.
Current wording
On August 7, 2019, we completed a transaction to acquire 12,340 square meters (approximately three acres) of land in Al Tajamouat Industrial City, Jordan, from a third party to construct a dormitory for our employees with aggregate purchase price JOD 863,800 (approximately $1,218,303). Management has revised the plan to construct both dormitory and production facilities on the land in order to capture the increasing demand for our capacity. We are conducting engineering design and study on this project with the business growth potential brought about by the new business collaboration with Busana Apparel Group. On February 6, 2020, we completed a transaction to acquire 4,516 square meters (approximately 48,608 square feet) of land in Al Tajamouat Industrial City, Jordan, from a third party to construct a dormitory for our employee with aggregate purchase price JOD 313,501 (approximately $442,162). The dormitory was completed in second quarter of fiscal 2025. We have spent approximately $10.1 million in capital expenditures to build the dormitory. The dormitory’s kitchen is under construction at an estimated cost of approximately $0.9 million.
Previous wording
We project that there will be an aggregate of approximately $4.1 million and $8.8 million of capital expenditures in the fiscal years ending March 31, 2025 and 2026, respectively, for further enhancement of production capacity to meet future sales growth. The realization of these investments depends on the progress of our business development, including expanding our client base and securing increased commitments from existing customers. We expect that our capital expenditures will increase in the future as our business continues to develop and expand. We have used cash generated from operations of our subsidiaries to fund our capital commitments in the past and anticipate using such funds to fund capital expenditure commitments in the future.
Current wording
We project that there will be an aggregate of approximately $2.2 million and $8.8 million of capital expenditures in the fiscal years ending March 31, 2025 and 2026, respectively, for further enhancement of production capacity to meet future sales growth. The realization of these investments depends on the progress of our business development, including expanding our client base and securing increased commitments from existing customers. We expect that our capital expenditures will increase in the future as our business continues to develop and expand. We have used cash generated from operations of our subsidiaries to fund our capital commitments in the past and anticipate using such funds to fund capital expenditure commitments in the future.