Synergy Empire Limited: A Comprehensive Review of the 2024 10-K Filing

Introduction

Synergy Empire Limited, a Nevada corporation, has undergone significant changes in its business operations over the past year. This review will delve into the company's 10-K filing for the fiscal year ending March 31, 2024, to assess its investment potential. We'll explore the company's business model, financial performance, risk factors, and overall investment desirability.

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Business Overview

Synergy Empire Limited was incorporated in Nevada on October 17, 2018. The company initially engaged in the production and sale of food products, specifically desserts, through various restaurants in Malaysia under the brand name "Sweet Hut." However, the company has recently shifted its focus to providing consultancy services to restaurant owners, specializing in restaurant and kitchen management.

The company's strategic pivot is aimed at leveraging the director's extensive experience in the food and beverage industry. By offering expert guidance on various aspects of restaurant operations, the consultancy aims to help restaurant owners optimize their business performance. This new direction broadens the company's service portfolio and positions it as a valuable consultant for restaurant owners seeking to enhance their operational effectiveness and profitability.

Financial Performance

Revenue and Profitability

For the fiscal year ending March 31, 2024, Synergy Empire Limited reported a total revenue of $5,000, a significant decrease from $122,381 in the previous year. This decline is primarily due to the company's transition from a food and beverage business to a consultancy service provider. The company earned a consultancy revenue of $5,000, while lease, dine-in, and delivery revenues were non-existent due to the termination of all tenancy agreements.

The company's gross profit margin increased from 43.28% in 2023 to 100% in 2024, as there were no costs associated with dine-in and delivery services. However, the company incurred a net loss from continuing operations of $671,075, compared to a net loss of $534,676 in the previous year.

Cash Flow and Liquidity

Synergy Empire Limited's cash and cash equivalents decreased from $9,868 in 2023 to $82 in 2024. The company used $132,747 in operating activities, primarily due to the net loss and increases in accounts receivable and prepaid expenses. The company did not invest in any plant and equipment during the year.

The company had net proceeds from financing activities of $132,735, primarily consisting of advances from subsidiaries, directors, and related parties, as well as the issuance of new common shares.

Risk Factors

The company's 10-K filing highlights several risk factors that could impact its operations and financial performance. These include:

• Economic and Competitive Conditions: The company operates in a highly competitive industry with low barriers to entry, which could affect its market position and profitability.
• Regulatory Changes: Changes in laws, regulations, or taxes in the industry could impact the company's operations.
• Dependence on Key Personnel: The company's success is heavily reliant on the expertise and experience of its director, H'sien Loong Wong.
• Financial Stability: The company's financial position is precarious, with a significant accumulated deficit and negative working capital.

Legal Proceedings

As of the date of the 10-K filing, Synergy Empire Limited is not involved in any material legal proceedings. However, the company acknowledges that it may be subject to various claims, legal actions, and regulatory proceedings arising in the ordinary course of business.

Conclusion

Synergy Empire Limited's transition from a food and beverage business to a consultancy service provider marks a significant shift in its business model. While the company has potential in its new direction, its financial performance and liquidity position raise concerns about its ability to sustain operations in the long term.

The company's reliance on key personnel, coupled with the competitive and regulatory challenges in the industry, further complicates its investment potential. As such, potential investors should carefully consider these factors before making an investment decision.

Overall, Synergy Empire Limited's 10-K filing presents a mixed picture, with opportunities for growth in consultancy services but significant financial and operational challenges to overcome.