Smart Powerr Corp.

Previous wording

Total sales for the three months ended March 31, 2025, amounted to $20,625. The company signed an Operation and Maintenance Contract for 10 years with a third party, and recognized the revenue based on the time period.

Current wording

Total sales for the six months ended June 30, 2025, amounted to $82,839. The company signed an Operation and Maintenance Contract for a power station. The contract has total amount RMB1.8 million (US$0.2 million), starting from March 1, 2025 to February 28, 2035 for 10 years with a third party. The Company recognized the revenue based on the time period.

Previous wording

Cost of sales (“COS”) for the three months ended March 31, 2025, was $11,806.

Current wording

Cost of sales (“COS”) for the six months ended June 30, 2025, was $47,418.

Previous wording

For the three months ended March 31, 2025, the gross margin was 43%.

Current wording

For the six months ended June 30, 2025, the gross margin was 43%.

Previous wording

Operating expenses consisted of general and administrative expenses (“G&A”) totaling $1,171,209 for the three months ended March 31, 2025, compared to $208,430 for the three months ended March 31, 2024. This represented an increase of $962,779.00 or 462% year-over-year. The increase was mainly attributable to an increase in financing costs of $948,648.

Current wording

Operating expenses consisted of general and administrative expenses (“G&A”) totaling $2,223,109 for the six months ended June 30, 2025, compared to $559,237 for the six months ended June 30, 2024. This represented an increase of $1,663,876 or 298% year-over-year. The increase was mainly attributable to an increase in financing costs of $948,648 and share-based compensation of $831,520.

Previous wording

Net non-operating expenses consisted of gain or loss from note conversion, interest income, interest expenses, and other miscellaneous expenses. For the three months ended March 31, 2025, net non-operating expenses were $311,849 compared to non-operating income of $57,187 for the three months ended March 31, 2024. The primary reason was the provision of financial support to other companies, which generated interest income of $98,999, coupled with the reversal of a $200,000 provision for impaired prepayments.

Current wording

Net non-operating expenses consisted of gain or loss from note conversion, interest income, interest expenses, and other miscellaneous expenses. For the six months ended June 30, 2025, net non-operating income were $93,159 compared to non-operating expenses of $116,141 for the six months ended June 30, 2024. The primary reason was the provision of financial support to other companies, which generated interest income of $98,999, coupled with the reversal of a $200,000 provision for impaired prepayments, offsetting by the interest expenses of $251,414.

Previous wording

Income tax expense was $33,919 for the three months ended March 31, 2025, compared with income tax expense of $14,180 for the three months ended March 31, 2023. The consolidated effective income tax rate for the three months ended March 31, 2025, and 2024 were 0% and 1.6%, respectively. In 2025, Management concluded that the realizability of related tax benefits from these losses was uncertain due to the continuing operating losses at the US parent company. Accordingly, a 100% valuation allowance was provided against the deferred tax asset.

Current wording

Income tax expense was $34,747 for the six months ended June 30, 2025, compared with income tax expense of $14,176 for the six months ended June 30, 2024. The consolidated effective income tax rate for the three months ended June 30, 2025, and 2024 were 0% and 1.6%, respectively. In 2025, Management concluded that the realizability of related tax benefits from these losses was uncertain due to the continuing operating losses at the US parent company. Accordingly, a 100% valuation allowance was provided against the deferred tax asset.

Previous wording

NET LOSS. Net loss for the three months ended March 31, 2025, was $884,460 compared to loss of $279,797 for the three months ended March 31, 2024, representing an increase in net loss of $604,663. The increase in net loss was mainly driven by rising operating expenses and the reversal of impairment provision, as previously discussed.

Current wording

Net loss for the six months ended June 30, 2025, was $2,129,276 compared to loss of $689,554 for the six months ended June 30, 2024, representing an increase in net loss of $1,439,722. The increase in net loss was mainly driven by rising operating expenses and the reversal of impairment provision, as previously discussed.

Previous wording

As of March 31, 2025, the Company maintained cash and equivalents of $129.60 million, other current assets (excluding cash and equivalents) of $0.26 million, current liabilities of $13.40 million, and working capital of $116.81 million, with a current ratio of 9.96:1 and a debt-to-equity ratio of 0.13:1.

Current wording

As of June 30, 2025, the Company maintained cash and equivalents of $131.11 million, other current assets (excluding cash and equivalents) of $0.23 million, current liabilities of $12.74 million, and working capital of $118.6 million, with a current ratio of 10.31:1 and a debt-to-equity ratio of 0.12:1.

Previous wording

The following is a summary of cash flows provided by or used in each of the indicated types of activities, for the three- months periods ended March 31, 2025, and 2024:

Current wording

The following is a summary of cash flows provided by or used in each of the indicated types of activities, for the six- months periods ended June 30, 2025, and 2024:

Previous wording

Net cash generated from operating activities was $64.63 million for the three months ended March 31, 2025, compared to $0.18 million for the three months ended March 31, 2024. The increase in net cash inflow for the three months ended March 31, 2025, was mainly driven by the recovery of $65.6 million in advance payments to suppliers, which generated cash inflows.

Current wording

Net cash generated from operating activities was $64.63 million for the six months ended June 30, 2025, compared to $0.18 million for the six months ended June 30, 2024. The increase in net cash inflow for the six months ended June 30, 2025, was mainly driven by the recovery of $65.6 million in advance payments to suppliers, which generated cash inflows.

Previous wording

Net cash provided by investing activities was $55.20 million and $68.56 million respectively for the three months ended March 31, 2025, and 2024. For the three months ended March 31, 2025, repayments of short-term loans decreased by $13.36 million. As of March 31, 2025, the Company had recovered a short-term loan of $55,660,131 (RMB406.3 million) from Xi’an Yingtai Energy Conservation Technology Co., Ltd (“Xi’an Yingtai”), an unrelated party of the Company.

Current wording

Net cash provided by investing activities was $55.20 million and $68.56 million respectively for the six months ended June 30, 2025, and 2024. For the six months ended June 30, 2025, repayments of short-term loans decreased by $13.36 million. As of June 30, 2025, the Company had recovered a short-term loan of $55,660,131 (RMB406.3 million) from Xi’an Yingtai Energy Conservation Technology Co., Ltd (“Xi’an Yingtai”), an unrelated party of the Company.

Previous wording

Net cash provided by financing activities was $9.87 million during the three months ended March 31, 2025, primarily attributable to proceeds from equity issuance.

Current wording

Net cash provided by financing activities was $9.87 million during the six months ended June 30, 2025, primarily attributable to proceeds from equity issuance.

Previous wording

The Company incurred an operating loss of $1.17 million, generated operating cash flows of $64.63 million, and reported net loss of $0.88 million for three months ended March 31, 2025. As the Company implements its future business plan, it may continue to incur operating losses and generate negative operating cash flows. At the end of March 31, 2025, the Company had accumulated deficit balance of $62.94 million and cash balance of $129.6 million. The Company has collected back RMB405.8 million in accounts receivable and recovered RMB 476 million in supplier advances and raised capital through of common stock issuance during the first quarter of 2025.

Current wording

The Company incurred an operating loss of $2.19 million, and reported net loss of $2.13 million for six months ended June 30, 2025. As the Company implements its future business plan, it may continue to incur operating losses and generate negative operating cash flows. In 2025, the Company collected back $65.6 million advance to supplier and had positive operating cash flow during the six months ended June 30, 2025. At the end of June 30, 2025, the Company had accumulated deficit balance of $64.19 million and cash balance of $131.1 million. The Company has collected back RMB405.8 million in accounts receivable and recovered RMB 476 million in supplier advances and raised capital through of common stock issuance during the first quarter of 2025.