Lakeside Holding Limited: A Comprehensive Review of the 2024 10-K Filing

Introduction

Lakeside Holding Limited, a U.S.-based integrated cross-border supply chain solution provider, has recently filed its 10-K for the fiscal year ending June 30, 2024. This review delves into the company's business operations, financial performance, risk factors, and overall investment potential. With a strategic focus on the Asian market, particularly China and South Korea, Lakeside Holding Limited offers a variety of services, including cross-border ocean and air freight solutions, customs clearance, warehousing, and U.S. domestic ground transportation.

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Business Overview

Core Services

Lakeside Holding Limited provides customized cross-border ocean and air freight solutions tailored to the needs of its customers. The company's services include:

1. Cross-border Freight Consolidation and Forwarding Services: As a licensed non-vessel operating common carrier (NVOCC) and indirect air carrier, the company offers both ocean and air freight consolidation and forwarding services.
2. Customs Clearance Services: Collaborating with licensed customs brokerage experts, the company assists in clearing shipments importing into the U.S.
3. Warehousing and Distribution Services: Operating two regional warehousing and distribution centers in Illinois and Texas, the company offers storage, packaging, and distribution services.
4. U.S. Domestic Ground Transportation Services: Providing flexible, cost-competitive ground transportation services through an extensive network of domestic carriers.

Market Opportunity

The cross-border supply chain solutions industry is highly fragmented, with significant growth potential. According to McKinsey, the market size of cross-border e-commerce is expected to expand to around $1 trillion in merchandise value by 2030, from a current value of approximately $300 billion. Asia is expected to account for 57% of the growth of the global e-commerce logistics market between 2020 and 2025.

Financial Performance

Revenue and Profitability

For the fiscal year ended June 30, 2024, Lakeside Holding Limited reported total revenues of $18.3 million, a 42.3% increase from $12.9 million in the previous fiscal year. The company's gross profit also saw a significant increase, rising by 44.9% to $3.7 million from $2.6 million in the prior year. However, the company reported a net loss of $225,252 for the fiscal year ended June 30, 2024, compared to a net income of $983,602 in the previous year.

Revenue Breakdown

• Cross-border Ocean Freight Solutions: Revenues decreased by 2.5% to $7.9 million.
• Cross-border Airfreight Solutions: Revenues increased by 117.6% to $10.4 million.

Cost of Revenues

The cost of revenues increased by 41.6% to $14.6 million, primarily due to higher transportation and delivery costs, warehouse service charges, and custom declaration and terminal charges.

General and Administrative Expenses

General and administrative expenses increased by 77.5% to $4.1 million, primarily due to higher salary and employee benefit expenses, office expenses, and professional fees.

Risk Factors

Key Risks

1. Competitive Environment: The company operates in a highly competitive and rapidly changing environment.
2. Regulatory Compliance: Compliance with various laws and regulations, particularly in the U.S. and Asia, is crucial for the company's operations.
3. Economic Conditions: Fluctuations in currency exchange, interest, or inflation rates could impact the company's financial condition.
4. Cybersecurity: The company has not experienced any material cybersecurity incidents but acknowledges the importance of robust cybersecurity measures.

Investment Potential

Strengths

1. Strategic Focus on the Asian Market: The company's deep understanding of the Asian market provides a competitive edge.
2. Extensive Service Provider Network: Collaboration with major global ocean and air carriers and U.S. domestic ground transportation carriers.
3. Strong Customer Base: Serving over 300 customers, including large e-commerce platforms and manufacturers.
4. Technological Advancements: Investment in a proprietary technology platform to streamline operations and enhance service quality.

Weaknesses

1. Net Loss: The company reported a net loss for the fiscal year ended June 30, 2024.
2. High Operating Costs: Significant increase in general and administrative expenses.
3. Dependence on Key Markets: Heavy reliance on the Asian market, particularly China and South Korea.

Conclusion

Lakeside Holding Limited shows strong growth potential, particularly in the rapidly expanding cross-border e-commerce market. However, the company faces challenges, including high operating costs and a competitive environment. With a strategic focus on the Asian market and significant investments in technology, the company is well-positioned for future growth. Based on the analysis, Lakeside Holding Limited receives an investment score of 7.5 out of 10.

Summary

Lakeside Holding Limited, a U.S.-based integrated cross-border supply chain solution provider, reported total revenues of $18.3 million for the fiscal year ended June 30, 2024, a 42.3% increase from the previous year. The company reported a net loss of $225,252, compared to a net income of $983,602 in the prior year. The company's strengths include a strategic focus on the Asian market, an extensive service provider network, a strong customer base, and technological advancements. However, challenges include high operating costs and a competitive environment. The company receives an investment score of 7.5 out of 10.