Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of the Company's financial condition and results of operations should be read in conjunction with our consolidated financial statements and the related notes included elsewhere in the report. This discussion contains forward-looking statements that involve risks and uncertainties. Actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of various factors.

Overview

The Company is an integrated logistics solution provider that was founded in 2001. On September 18, 2007, the Company merged into Sino-Global Shipping America, Ltd., a Virginia corporation. On January 3, 2022, the Company changed its corporate name from Sino-Global Shipping America, Ltd. to Singularity Future Technology Ltd. to reflect its then expanded operations into the digital assets business. Currently, the Company primarily focus on providing freight logistics services, which include shipping, and other logistical support to steel companies, through subsidiary, Trans Pacific Shipping Limited.

We have not generated any revenues to date with respect to our entry into the solar panel production and distribution business.

Recent Developments

Disposition of New Energy Tech Ltd.

On August 22, 2024, New Energy Tech Ltd., ("New Energy") a New York corporation and wholly owned subsidiary of the Company, entered into a certain joint venture agreement (the "JV Agreement") with Market One Service Corp., a corporation organized under the laws of Wyoming, ("Market One"). Pursuant to the JV Agreement, among other things and subject to the terms and conditions contained therein, New Energy and Market One agreed to establish a limited company under the laws of Ohio, SG Campbells Creek Commodities (the "JV"), to engage in the business of commodity trading.

On September 25, 2025, the Company entered into a share transfer agreement with Qingmin Sun, pursuant to which the equity ownership of New Energy was transferred to Qingmin Sun for consideration of $2,700,000 in cash. This disposition was closed on September 25, 2025.

June 2025 Private Placement

As previously disclosed, on June 19, 2025, the "Company entered into a securities purchase agreement (the "SPA") with eighteen investors, under which the Company agrees to sell to the investors an aggregate of 32,188,841 units (the "Unit"), each Unit consisting of one share of the Company's common stock, without par value (the "Common Stock") and three warrants, with each warrant initially exercisable to purchase one share of the Common Stock at an exercise price of $1.165 (the "Warrants"), in a private placement to certain "non-U.S. Persons" as defined in Regulation S of the Securities Act of 1933, as amended (the "Regulation S"), at a price of $0.932 per Unit for an aggregate purchase price of approximately $30 million.

The Warrants are exercisable immediately upon the date of issuance at an initial exercise price of $1.165, for cash. The Warrants may also be exercised cashlessly if at any time after the six-month anniversary of the issuance date, there is no effective registration statement registering, or no current prospectus available for, the resale of the shares of Common Stock underlying the Warrant. The Warrants shall expire five years from its date of issuance. The Warrants are subject to customary anti-dilution provisions reflecting capitalizations and subdivisions or other similar transactions.

The SPA is subject to various conditions to closing, including, among other things, (a) receipt of the Company's shareholders' approval and ratification of the SPA and (b) accuracy of the parties' representations and warranties.

October 2025 Private Placement

On October 15, 2025, the Company entered into a securities purchase agreement with certain investors, under which the Company agrees to sell to the investors an aggregate of 3,000,000 shares of the Company's Common Stock at a price of $0.70 per share, in a private placement to certain "non-U.S. Persons" as defined in Regulation S, for an aggregate purchase price of approximately $2.1 million.

The parties to the SPA have each made customary representations, warranties and covenants, including, among other things, (a) the Purchasers are "non-U.S. Persons" as defined in Regulation S and are acquiring the Shares for the purpose of investment, (d) the absence of any undisclosed material adverse effects, and (e) the absence of legal proceedings that affect the completion of the transaction contemplated by the Securities Purchase Agreement, except as disclosed in the Company's filings with the SEC.

On October 20, 2025, upon satisfaction of the closing conditions, the Offering was consummated, and the shares were issued in reliance on the exemption from registration provided by Regulation S. The Company currently intends to use the net proceeds from this offering for working capital and general corporate purposes.

Results of Operations

Comparison of the Three Months Ended September 30, 2025 and 2024

The following table sets forth the results of our operations for the periods indicated:

		For the Three Months Ended September 30,								Variance
		2025				2024				Amount				%
Net revenues		$	307,888			$	501,402			$	(193,514	)			(38.6	)%
Cost of revenues			(297,566	)			(773,317	)			(475,751	)			(61.5	)%
Gross profit (loss)			10,322				(271,915	)			282,237				103.8	%
Selling expenses			(47,431	)			(62,981	)			(15,550	)			(24.7	)%
General and administrative expenses			(527,737	)			(690,556	)			(162,819	)			(23.6	)%
Operating loss			(564,846	)			(1,025,452	)			(460,606	)			(44.9	)%
Gain from disposal of subsidiaries			47,359				-				47,359				100.0	%
Interest expenses			(114,392	)			-				114,392				100.0	%
Class action settlement expenses			(8,850,000	)			-				8,850,000				100.0	%
Other income, net			16				21,117				(21,101	)			(99.9	)%
Net loss before income tax expenses			(9,481,863	)			(1,004,335	)			8,477,528				844.1	%
Income tax expense			-				-				-				0.0	%
Net loss		$	(9,481,863	)		$	(1,004,335	)		$	8,477,528				844.1	%

Revenues from Freight Logistics Services

Freight logistics services primarily consist of cargo forwarding, brokerage, warehouse and other freight services. Revenues from freight logistics services decreased by approximately $0.2 million, or approximately 38.6%, to $0.3 million for the quarter ended September 30, 2025 from $0.5 million for the quarter ended September 30, 2024. The decrease was mainly caused by shipping revenue declined from our PRC subsidiaries as the tariff wars caused significant decline in business volume. For the quarter ended September 30, 2025, the Company generated all of its revenue in PRC.

Cost of Revenues

Cost of revenues for our freight logistics services mainly consisted of freight costs to various freight carriers, cost of labor, warehouse rent and other overhead and sundry costs. Cost of revenues for our freight logistics services decreased by approximately $0.5 million, or 61.5%, to approximately $0.3 million for the quarter ended September 30, 2025 from approximately $0.8 million for the same period of last year. The closure of U.S. subsidiary, Brilliant Warehouse in fiscal 2024 which significant reduced cost of revenue by $3.0 million. The cost from our PRC subsidiaries declined by $0.2 million mainly contributed by decline in business volume as a result of tariff wars.

Our gross margin was 3.4% from our PRC subsidiaries for the quarter ended September 30, 2025 which declined by 3.2% from 6.5% for the quarter ended September 30, 2024 due to marginal increase in freight costs. Our gross margin was (54.2%) for the quarter ended September 30, 2024, which was mainly due to decreased revenue from our freight logistics business and ceased to sell crypto-mining equipment since January 1, 2023.

Selling Expenses

Our selling expenses consisted primarily of salaries, meals and entertainment and travel expenses for our sales representatives. Our selling expenses decreased by approximately $15,550, or 24.7%, to $47,431 for the quarter ended September 30, 2025 from $62,981 for the same period of last year. The decrease was mainly attributable in the decrease in freight volume which, in turn, reduced selling activities and the related selling expenses.

General and Administrative Expenses

Our general and administrative expenses consist primarily of salaries and benefits, travel expenses for our administration department, office expenses, and regulatory filing and professional service fees for auditing, and legal services. Our general and administrative expenses decreased by approximately $0.2 million, or 23.6%, to $0.5 million for the quarter ended September 30, 2025 from $0.7 million for the same period of last year. Since closure of business operation in U.S., the management undertook significant cost cutting initiatives reducing all categories of general administrative expenses across the board.

Gain from disposal of subsidiaries

On August 6, 2025, the Company dissolved its subsidiary, Brilliant Warehouse Service Inc. On September 25, 2025, the Company entered into a share transfer agreement with a third party and disposed its subsidiary, New Energy Tech Limited, for a consideration of $2.7 million. Total gain from these disposals was $47,359 for the quarter ended September 30, 2025. No such disposal for the quarter ended September 30, 2024.

Interest expenses

Interest expenses increased to $0.1 million, or 100%, to approximately $0.1 million for the quarter ended September 30, 2025 from nil for the same period of last year. As of September 30, 2025, loans from third parties amounted to $1.1 million with a weighted average interest rate of 12% per annum and a weighted average maturity of 0.9 year.

Class action settlement expenses

We recorded approximately $8.9 million in class action settlement expenses for the quarter ended September 30, 2025, compared to nil in such expenses for the same period of last year. On December 9, 2022, Piero Crivellaro, purportedly on behalf of the persons or entities who purchased or acquired the publicly traded common stock of the Company between February 2021 and November 2022, brought a putative class action, Crivellaro v. Singularity Future Technology Ltd., 22-cv-7499-BMC, against the Company and a dozen related person and entities in the United States District Court for the Eastern District of New York (the "Court"). Plaintiffs alleged violations of the U.S. federal securities laws by the Company. Plaintiffs seek damages, plus interest, costs, fees, and attorneys' fees. The Company filed a motion to dismiss on November 20, 2023.

On December 17, 2024, the Court issued an order that partially denied the motions to dismiss filed by the Company and its former chief executive officer, Yang Jie, arising from various statements made by Yang Jie about two allegedly fraudulent transactions. The rest of the motions are granted. On January 2, 2025, the Company filed an answer to the Second Amended Class Action complaint.

On May 29, 2025, the Company and the lead plaintiffs in the class action executed a binding term sheet (the "Settlement Term Sheet") setting forth the material terms of their proposed settlement on a class wide basis. On July 13, 2025, the parties executed a Stipulation and Agreement of Settlement ("Settlement Agreement"). Pursuant to the Settlement Agreement, in exchange for the Settlement payment and subject to final approval by the Court, all plaintiffs in the Class Action will release the Company and the other defendants on all claims. The Settlement Payment include cash payment of $3,000,000 and 6,500,000 freely tradable shares of the Company's Common Stock (the "Settlement Shares"), which shall be issued pursuant to Section 3(a)(10) of the Securities Act of 1933, subject to the Court's approval of the Settlement. In the event of a reverse stock split prior to the effectiveness of the Settlement, the number of Settlement Shares and/or the put option purchase price (described below) shall be reformulated so that the value of the Settlement Shares/put option shall not be less than $5,850,0000 as of the effectiveness of the Settlement. The settlement class has the right to sell all or a portion of the unsold Settlement Shares back to the Company at $0.85 per share if the 10-trading day average closing price immediately prior to the exercise of the put option falls below $0.85 before the class lead counsel sells the Settlement Shares. The Company agreed to maintain a cash balance $3,250,000 in a dedicated escrow account to mitigate the risk that it is unable to satisfy the put option.

As of and for the quarter ended September 30, 2025, the class action settlement liability and expenses amounted to $8,850,000, respectively, being a total of $3,000,000 in cash and 6,500,000 common shares which has a value of $5,850,000. On October 9, 2025, the Company has wired $2,000,000, which are loans from unrelated parties, as part of the settlement cash payment to the Escrow Account set forth in the Settlement Agreement in the class action lawsuit.

Income tax expenses

Our income tax expenses amounted to nil and nil for the quarter ended September 30, 2025 and 2024, respectively.

Net Loss

As a result of the foregoing, we had a net loss of approximately $9.5 million and $1.0 million for the quarter ended September 30, 2025 and 2024, respectively.

Liquidity and Capital Resources

Cash Flows and Working Capital

As of September 30, 2025, we had $17.1 million in cash (including cash on hand and cash in bank). The majority of our cash is in banks located in the Djibouti a country in East Africa and the restricted cash is in banks located in U.S.

The following table sets forth a summary of our cash flows for the periods as indicated:

		For the Three Months Ended
		September 30,
		2025				2024
Net cash used in operating activities		$	(1,257,803	)		$	(9,145	)
Net cash provided by investing activities			108,331				-
Net cash provided by financing activities			724,862				-
Effect of changes of foreign exchange rate on cash and restricted cash			190				13,994
Cash and restricted cash, beginning of period			17,651,896				17,736,059
Cash and restricted cash, end of period		$	17,227,476			$	17,740,908

Operating Activities

Our net cash used in operating activities was approximately $1.3 million for the three months ended September 30, 2025. The operating cash outflow for the three months ended September 30, 2025 was primarily attributable to our net loss of approximately $9.5 million, payment of approximately $0.3 million to accounts payable and payment of approximately $0.3 million to judgment debt payable, as partially offset by class action settlement of approximately $8.9 million.

Our net cash used in operating activities was approximately $9,145 for the three months ended September 30, 2024. The operating cash outflow for the three months ended September 30, 2024 was primarily attributable to our net loss of approximately $1.0 million. We had an increase in accounts payable of approximately $585,260, and an increase in accrued expenses and other current liabilities of approximately $666,166 offset by an increase in accounts receivable of approximately $355,203.

Investing Activities

Net cash provided by investing activities was approximately $0.1 million for the three months ended September 30, 2025 due to proceeds from disposal of subsidiaries, net of cash.

We did not have any investing activities for the three months ended September 30, 2024.

Financing Activities

Net cash used in financing activities for the three months ended September 30, 2025 was approximately $0.7 million due to advance of $69,862 from a related party for payment of expenses and approximately $0.7 million of loans from third parties.

We did not have any financing activities for the three months ended September 30, 2024.

Critical Accounting Estimates

The preparation of financial statements and related disclosures in conformity with U.S. generally accepted accounting principles and the Company's discussion and analysis of its financial condition and operating results require the Company's management to make judgments, assumptions and estimates that affect the amounts reported. Note 2, "Summary of Significant Accounting Policies" of the Notes to consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended June 30, 2025 (describe the significant accounting policies and methods used in the preparation of the Company's consolidated financial statements. There have been no material changes to the Company's critical accounting estimates since the 2023 Form 10-K.

Off-Balance Sheet Arrangements

None.