Elite Express Holding Inc.
10/14/2025 | Press release | Distributed by Public on 10/14/2025 04:20
Quarterly Report for Quarter Ending August 31, 2025 (Form 10-Q)
Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis should be read in conjunction with the consolidated financial statements and the related notes included elsewhere in this quarterly report on Form 10-Q.
Forward-Looking Statements
This quarterly report on Form 10-Q contains "forward-looking statements." All statements other than statements of historical fact are "forward-looking statements" for purposes of federal and state securities laws, including, but not limited to: any projections of earnings, revenue, or other financial items; any statements regarding the adequacy, availability, and sources of capital, any statements of the plans, strategies, and objectives of management for future operations; any statements concerning proposed new products, services, or developments; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. Forward-looking statements may include the words "may," "will," "estimate," "intend," "continue," "believe," "expect," "plan," "project," or "anticipate," and other similar words. In addition to any assumptions and other factors and matters referred to specifically in connection with such forward-looking statements, factors that could cause actual results or outcomes to differ materially from those contained in the forward-looking statements include those factors set forth in the "Risk Factors" section included in our registration statement on Form S-1 (File No. 333-286965), as amended, which was initially filed with the SEC on May 5, 2025 and declared effective by the SEC on August 20, 2025.
Although we believe that the expectations reflected in our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and to inherent risks and uncertainties, such as those disclosed in this quarterly report. We do not intend, and undertake no obligation, to update any forward-looking statement, except as required by law.
The information included in this Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our unaudited condensed consolidated financial statements and the notes included in this quarterly report on Form 10-Q.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
We are a holding company incorporated in Delaware. Through our wholly owned subsidiary, JAR, a California-based operating entity, we specialize in last-mile delivery services within California. Our core business focuses on retrieving packages from distribution hubs and ensuring their prompt and secure delivery to recipients' doorsteps. Committed to innovation and efficiency, our mission is to optimize last-mile logistics by providing efficient, reliable, and innovative delivery solutions.
As of the date of this quarterly report, we employ approximately 31 full-time staff, including approximately 24 drivers. Our fleet consists of approximately 23 trucks and trailers. We provide exclusive pickup and delivery services within our designated service area, covering approximately 1,665.28 square miles. We utilize GroundCloud, a leading logistics software, during our course of business, for route optimization, driver management, and compliance monitoring. Additionally, we are actively expanding our investment in advanced technologies to enhance our scalability, automate our operations, and drive our data-driven decision-making. On an average day, we complete between 1,000 to 1,700 stops, facilitating the pickup and delivery of approximately 1,200 to 2,000 packages. During peak seasons, our daily stops rise to an estimated 2,000, allowing us to meet heightened demand with efficiency and reliability.
Currently, we pick up packages from the distribution hubs of FedEx and deliver them to recipients within designated service areas. While FedEx has been our only customer under an Independent Service Provider ("ISP") agreement, we are actively exploring opportunities to expand our customer base, diversify our revenue streams and strengthen our market presence.
The holding company, prior to the acquisition of JAR on October 25, 2024 (the "Acquisition Date"), did not have any active business operations.
Key Factors Affecting Our Results of Operations
Our results of operations are influenced by several interrelated factors that reflect the dynamic nature of our business environment. The following are the key factors that impact our performance:
| ● | E-Commerce Growth: We believe the rapid growth of e-commerce is a driving force behind the increased demand for last-mile delivery services. As consumer habits continue to shift toward online shopping, we anticipate benefiting from rising delivery volumes. Meeting customer expectations for fast and reliable service requires ongoing investments in technology and operational capacity. |
| ● | Labor Costs and Workforce Management: Labor costs are one of the largest components of our cost structure, accounting for approximately 50% or more of our total costs through August 31, 2025. Retaining a skilled and motivated workforce is critical to maintaining service quality. We strive to mitigate these challenges by optimizing staffing models, including employing part-time and gig workers during peak demand periods, and investing in workforce training and retention programs to improve driver efficiency and reduce turnover. |
| ● | Fuel Costs and Operational Efficiency: Fuel costs are another significant component of our cost of revenue and fluctuations in fuel prices can directly affect our profitability. We managed fuel expenses through standard route planning and operational adjustments on or prior to the Acquisition Date. To further enhance efficiency, we have implemented route optimization strategies aimed at reducing mileage and improving fuel efficiency. In addition, we are exploring the integration of electric vehicles to reduce our reliance on traditional fuel sources and align with our sustainability objectives. |
| ● | Seasonal Demand and Resource Scaling: Peak seasons, such as the holiday period, account for a substantial portion of our annual revenue. Managing this demand requires precise planning and execution, including the temporary hiring of additional drivers, flexible routing strategies, and leveraging the FedEx DRO system, a predictive tool to anticipate delivery patterns. Successfully navigating these high-demand periods is essential to maintaining our reputation and customer relationships. |
| ● | Technology Investments: We utilize GroundCloud, a leading logistics software, for route optimization, driver management, and compliance monitoring. While continuing to leverage this system, we are also expanding our investments in advanced technologies to enhance operational scalability, data-driven decision-making, and automation. By continuously evaluating and adopting innovative solutions, we aim to enhance efficiency, improve service reliability, and optimize operational costs. These |
| ongoing investments in logistics technology are expected to strengthen our capacity to manage growing delivery volumes and position us for long-term success. |
| ● | Customer and Geographic Concentration: As of the date of this quarterly report, 100% of our revenue is derived from FedEx. While this relationship provides a stable source of revenue, it also results in a significant concentration of our business with a single customer. In addition, our operations are currently conducted exclusively within the State of California, which subjects us to regional economic conditions, regulatory requirements, and market dynamics specific to that jurisdiction. This geographic concentration, together with our customer concentration, exposes us to additional risks that could materially and adversely affect our business, financial condition, and results of operations. We are actively seeking to broaden our customer relationships and expand our operational presence beyond California in order to reduce such concentration risks over time. |
| ● | Capital Investments in Infrastructure: Sustained growth depends on strategic investments in vehicles, the transition to electric vehicle, and operational infrastructure, which includes tools and software that support our operations. We focused primarily on maintaining existing operations prior to the Acquisition Date. Following the Acquisition Date, we are adopting a more proactive investment strategy to expand capacity, enhance efficiency, and integrate advanced logistics solutions. These investments support our ability to scale operations, meet customer expectations, and enhance operational efficiency. While these expenditures may impact short-term profitability, they are essential for long-term success. |
Results of Operations
Comparison of Results of Operations for the Three and Nine Months Periods ended August 31, 2025 (Successor) and August 31, 2024 (Predecessor):
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For the Three Months |
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For the Nine Months |
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Ended August 31, |
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Ended August 31, |
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2025 |
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2024 |
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2025 |
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2024 |
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(Successor) |
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(Predecessor) |
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Change |
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(Successor) |
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(Predecessor) |
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Change |
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Amount |
% |
Amount |
% |
Amount |
% |
Amount |
% |
Amount |
% |
Amount |
% |
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Revenue |
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$ |
633,865 |
100.0 |
% |
$ |
590,375 |
100.0 |
% |
$ |
43,490 |
7.4 |
% |
$ |
1,956,258 |
100.0 |
% |
$ |
1,814,315 |
100.0 |
% |
$ |
141,943 |
7.8 |
% |
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Cost of Revenue |
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Cost of service |
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56,974 |
9.0 |
% |
54,602 |
9.2 |
% |
2,372 |
4.3 |
% |
176,984 |
9.0 |
% |
141,665 |
7.8 |
% |
35,319 |
24.9 |
% |
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Cost of labor |
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347,945 |
54.9 |
% |
330,747 |
56.0 |
% |
17,198 |
5.2 |
% |
1,085,885 |
55.5 |
% |
971,560 |
53.5 |
% |
114,325 |
11.8 |
% |
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Fuel |
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94,654 |
14.9 |
% |
102,614 |
17.4 |
% |
(7,960) |
(7.8) |
% |
304,600 |
15.9 |
% |
318,477 |
17.6 |
% |
(13,877) |
(4.4) |
% |
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Maintenance and repairs |
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63,143 |
10.0 |
% |
71,583 |
13.1 |
% |
(8,440) |
(11.8) |
% |
207,709 |
10.9 |
% |
216,647 |
11.9 |
% |
(8,938) |
(4.1) |
% |
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Depreciation and amortization |
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64,332 |
10.1 |
% |
60,618 |
10.3 |
% |
3,714 |
6.1 |
% |
188,668 |
9.6 |
% |
180,445 |
9.9 |
% |
8,223 |
4.6 |
% |
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Total cost of revenue |
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627,048 |
98.9 |
% |
620,614 |
105.0 |
% |
6,884 |
1.1 |
% |
1,963,846 |
100.3 |
% |
1,828,794 |
100.7 |
% |
135,052 |
7.4 |
% |
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Gross Profit (Loss) |
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6,817 |
1.1 |
% |
(29,789) |
(5.0) |
% |
36,606 |
122.9 |
% |
(7,588) |
(0.3) |
% |
(14,479) |
(0.7) |
% |
6,891 |
47.6 |
% |
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General and administrative expenses |
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151,600 |
23.9 |
% |
39,280 |
6.7 |
% |
112,320 |
285.9 |
% |
576,981 |
29.5 |
% |
108,299 |
6.0 |
% |
468,682 |
432.8 |
% |
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Total operating expenses |
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151,600 |
23.9 |
% |
39,280 |
6.7 |
% |
112,320 |
285.9 |
% |
(576,981) |
29.5 |
% |
108,299 |
6.0 |
% |
468,682 |
432.8 |
% |
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Loss from Operations |
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(144,783) |
(22.8) |
% |
(69,069) |
(11.7) |
% |
(75,714) |
109.6 |
% |
(584,569) |
(29.8) |
% |
(122,778) |
(6.7) |
% |
(461,791) |
376.1 |
% |
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Other Income (Expense) |
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Interest income (expense), net |
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2,248 |
0.4 |
% |
(7,236) |
(1.2) |
% |
9,484 |
131.1 |
% |
2,248 |
0.1 |
% |
(23,907) |
(1.3) |
% |
26,155 |
(109.4) |
% |
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Other income (expense), net |
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- |
- |
% |
(221) |
0.0 |
% |
221 |
100.0 |
% |
21,285 |
1.1 |
% |
2,964 |
0.2 |
% |
18,321 |
618.1 |
% |
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Total other income (expense), net |
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2,248 |
0.4 |
% |
(7,457) |
1.2 |
% |
9,705 |
130.1 |
% |
23,533 |
1.2 |
% |
(20,943) |
(1.1) |
% |
44,476 |
(212.4) |
% |
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Loss before Income Tax Provision |
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(142,535) |
(22.4) |
% |
(76,526) |
(12.9) |
% |
(66,009) |
(86.3) |
% |
(561,036) |
(28.6) |
% |
(143,721) |
(7.8) |
% |
(417,315) |
(290.4) |
% |
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Income Tax Provision (Benefit) |
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43,346 |
6.8 |
% |
- |
- |
% |
43,346 |
100.0 |
% |
(62,552) |
(3.2) |
% |
800 |
0.0 |
% |
(63,352) |
(7,919.0) |
% |
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Net Loss |
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$ |
(185,881) |
(29.2) |
% |
$ |
(76,526) |
(12.9) |
% |
$ |
(109,355) |
(142.9) |
% |
$ |
(498,484) |
(25.4) |
% |
$ |
(144,521) |
(7.8) |
% |
$ |
(353,963) |
244.9 |
% |
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Revenue
Our revenue is structured into two main categories: (i) fixed revenue, which includes weekly service charges, branding-related reimbursements, and peak season surcharges, and (ii) activity-based revenue, which includes charges based on the number of stops, packages delivered, e-commerce orders, fuel surcharges, and other variable components.
For the three months ended August 31, 2025 (Successor), we generated total revenue of $633,865, representing an increase of $43,490, or 7.4%, compared with $590,375 for the three months ended August 31, 2024 (Predecessor). For the nine months ended August 31, 2025 (Successor), we generated total revenue of $1,956,258, representing an increase of $141,943, or 7.8%, compared with $1,814,315 for the nine months ended August 31, 2024 (Predecessor). These increases were primarily attributable to higher volume-based activity revenue, particularly from e-commerce deliveries, which offset the decline in fixed weekly service fees. This growth also reflects our
ongoing improvements in operational execution, including optimized route allocation and enhanced workforce scheduling under the FedEx ISP framework.
The table below sets forth a breakdown of revenue components for the periods indicated:
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For the Three Months |
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For the Nine Months |
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Ended August 31, |
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Ended August 31, |
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2025 |
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2024 |
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2025 |
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2024 |
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(Successor) |
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(Predecessor) |
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Change |
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(Successor) |
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(Predecessor) |
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Change |
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Amount |
% |
Amount |
% |
Amount |
% |
Amount |
% |
Amount |
% |
Amount |
% |
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Fixed: |
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Weekly service charges |
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$ |
146,221 |
23.1 |
% |
$ |
164,709 |
27.9 |
% |
$ |
(18,488) |
(11.2) |
% |
$ |
438,182 |
22.4 |
% |
$ |
490,920 |
27.1 |
% |
$ |
(52,738) |
(10.7) |
% |
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Branding-related |
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9,423 |
1.5 |
% |
11,088 |
1.9 |
% |
(1,665) |
(15.0) |
% |
26,729 |
1.4 |
% |
31,108 |
1.7 |
% |
(4,379) |
(14.1) |
% |
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Subtotal: |
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155,644 |
24.6 |
% |
175,797 |
29.8 |
% |
(20,153) |
(11.5) |
% |
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464,911 |
23.8 |
% |
522,028 |
88.4 |
% |
(57,117) |
(10.9) |
% |
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Activity-based: |
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Stops |
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102,705 |
16.2 |
% |
93,102 |
15.8 |
% |
9,603 |
10.3 |
% |
306,607 |
15.7 |
% |
287,877 |
15.9 |
% |
18,730 |
6.5 |
% |
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Packages |
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15,795 |
2.5 |
% |
15,305 |
2.6 |
% |
490 |
3.2 |
% |
45,509 |
2.3 |
% |
47,718 |
2.6 |
% |
(2,209) |
(4.6) |
% |
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E-Commerce |
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269,965 |
42.6 |
% |
240,583 |
40.8 |
% |
29,382 |
12.2 |
% |
836,884 |
42.8 |
% |
724,130 |
39.9 |
% |
112,754 |
15.6 |
% |
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Large packages |
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19,543 |
3.1 |
% |
17,989 |
3.0 |
% |
1,554 |
8.6 |
% |
55,583 |
2.8 |
% |
49,489 |
2.7 |
% |
6,094 |
12.3 |
% |
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Fuel Surcharge |
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69,697 |
11.0 |
% |
47,466 |
8.0 |
% |
22,231 |
46.8 |
% |
212,816 |
10.9 |
% |
153,806 |
8.5 |
% |
59,010 |
38.4 |
% |
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Surge Stops |
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- |
0.0 |
% |
- |
- |
% |
- |
- |
% |
29,983 |
1.5 |
% |
26,844 |
1.5 |
% |
3,139 |
11.7 |
% |
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Subtotal: |
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477,705 |
75.4 |
% |
414,445 |
70.2 |
% |
63,260 |
15.3 |
% |
1,487,382 |
76.0 |
% |
1,289,864 |
71.1 |
% |
197,518 |
15.3 |
% |
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Other Pickup and Delivery (P&D) |
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516 |
0.0 |
% |
133 |
0.0 |
% |
383 |
288.0 |
% |
3,965 |
0.2 |
% |
2,423 |
0.4 |
% |
1,542 |
63.6 |
% |
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Total Revenue |
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$ |
633,865 |
100.0 |
% |
$ |
590,375 |
100.0 |
% |
$ |
43,490 |
7.4 |
% |
$ |
1,956,258 |
100.0 |
% |
$ |
1,814,315 |
100.0 |
% |
$ |
141,943 |
7.8 |
% |
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Activity-based revenue accounted for $477,705, or 75.4% of total revenue, during the three months ended August 31, 2025, compared with $414,445, or 70.2% of total revenue, for the same period in the prior year. This increase primarily attributable to our continued focus on operational throughput under the FedEx ISP structure, driven by higher E-Commerce Stop Charge and Per-Stop Fuel Surcharge rates, resulting in a $29,382, or 12.2%, increase in E-Commerce charges and a $22,231, or 46.8%, increase in fuel surcharges. In contrast, fixed revenue, including weekly service charges and branding-related revenue, declined from $175,797 to $155,644, a decrease of $20,153, or 11.5%, primarily due to a reduction in baseline weekly compensation from $164,709 to $146,221. Pursuant to our agreement with FedEx dated October 12, 2024, our weekly fixed service fees will remain unchanged from October 2024 through January 2026.
Activity-based revenue accounted for $1,487,382, or 76.0% of total revenue, during the nine months ended August 31, 2025, compared with $1,289,864, or 71.1% of total revenue, for the same period in the prior year. This increase primarily reflected higher E-Commerce Stop Charge and Per-Stop Fuel Surcharge rates instituted by FedEx, which resulted in a $112,754, or 15.6%, increase in E-Commerce charges and a $59,010, or 38.4%, increase in fuel surcharges, as well as our continued emphasis on operational throughput under the FedEx ISP structure. Fixed revenue, including weekly service charges and branding-related revenue, declined by $57,117, or 10.9%, primarily due to reduced baseline compensation under our updated service contract.
Among all revenue categories, e-commerce deliveries and weekly service charges remained the two largest contributors to our total revenue for both the three and nine months ended August 31, 2025 (Successor) and August 31, 2024 (Predecessor).
| ● | E-commerce deliveries generated $269,965 in revenue during the three months ended August 31, 2025 (Successor), or 42.6% of total revenue, compared with $240,583, or 40.8%, during the three months ended August 31, 2024 (Predecessor). E-commerce deliveries generated $836,884 in revenue during the nine months ended August 31, 2025 (Successor), or 42.8% of total revenue, compared with $724,130, or 39.9%, during the nine months ended August 31, 2024 (Predecessor).The increases in both periods, $29,382, or 12.2% during the third quarter of 2025 and $112,754, or 15.6% during the nine-month period of 2025, were primarily driven by increased standard pricing, sustained residential delivery demand and route density improvements within our assigned FedEx service areas. E-commerce deliveries represented the largest revenue component in both periods. |
| ● | Weekly service charges totaled $146,221, or 23.1% of total revenue, for the three months ended August 31, 2025 (Successor), compared with $164,709, or 27.9%, during the three months ended August 31, 2024 (Predecessor), and totaled $438,182, or 22.4% of total revenue, for the nine months ended August 31, 2025 (Successor), compared with $490,920, or 27.1%, during the nine months ended August 31, 2024 (Predecessor). The declines of $18,488, or 11.2% during the third quarter of 2025, and |
| $52,738, or 10.7% during the nine-month period of 2025, respectively, were primarily attributable to the decrease in the baseline contractual rates under our updated ISP agreement with FedEx. Although the dollar amounts decreased, these fixed service charges continued to provide a stable recurring revenue base that provided some predictability in our operating model. Our weekly service charges are expected to remain stable through January 2026. |
Cost of Revenue
The table below summarizes the total cost of revenue and its components for the interim periods presented:
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For the Three Months |
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For the Nine Months |
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Ended August 31, |
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Ended August 31, |
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2025 |
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2024 |
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2025 |
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2024 |
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(Successor) |
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(Predecessor) |
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Change |
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(Successor) |
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(Predecessor) |
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Change |
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Amount |
% |
Amount |
% |
Amount |
% |
Amount |
% |
Amount |
% |
Amount |
% |
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Cost of service |
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$ |
56,974 |
9.1 |
% |
$ |
54,602 |
8.8 |
% |
$ |
2,372 |
4.3 |
% |
$ |
176,984 |
9.0 |
% |
$ |
141,665 |
7.7 |
% |
$ |
35,319 |
24.9 |
% |
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Cost of Labor |
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347,945 |
55.5 |
% |
330,747 |
53.4 |
% |
17,198 |
5.2 |
% |
1,085,885 |
55.3 |
% |
971,560 |
53.2 |
% |
114,325 |
11.8 |
% |
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Fuel |
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94,654 |
15.1 |
% |
102,614 |
16.6 |
% |
(7,960) |
(7.8) |
% |
304,600 |
15.5 |
% |
318,477 |
17.4 |
% |
(13,877) |
(4.4) |
% |
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Maintenance and repairs |
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63,143 |
10.0 |
% |
71,583 |
11.5 |
% |
(8,440) |
(11.8) |
% |
207,709 |
10.6 |
% |
216,647 |
11.8 |
% |
(8,938) |
(4.1) |
% |
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Depreciation and amortization |
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64,332 |
10.3 |
% |
60,618 |
9.7 |
% |
3,714 |
6.1 |
% |
188,668 |
9.6 |
% |
180,445 |
9.9 |
% |
8,223 |
4.6 |
% |
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Total Cost of Revenue |
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$ |
627,048 |
100.0 |
% |
$ |
620,164 |
100.0 |
% |
$ |
6,884 |
1.1 |
% |
$ |
1,963,846 |
100.0 |
% |
$ |
1,828,794 |
100.0 |
% |
$ |
135,052 |
7.4 |
% |
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For the three months ended August 31, 2025 (Successor), our cost of revenue was $627,048, or 98.9% of total revenue, compared with $620,164, or 105.0%, for the three months ended August 31, 2024 (Predecessor). Cost of revenue was nominally higher in the 2025 period versus the comparable 2024 period due primarily to higher labor costs, partially offset by lower fuel prices and maintenance and repair fees, but were sufficiently well controlled to generate a first time gross profit.
For the nine months ended August 31, 2025 (Successor), our cost of revenue was $1,963,846, or 100.3% of total revenue, compared with $1,828,794, or 100.7%, for the nine months ended August 31, 2024 (Predecessor), representing an increase of $135,052, or 7.4%. This increase was mainly driven by higher labor and service costs.
The cost of revenue consists of labor, fuel, depreciation and amortization, service and maintenance related expenses. Each component of our cost of revenue impacted the overall cost structure during the three and nine months ended August 31, 2025 (Successor) and the three months and nine months ended August 31, 2024 (Predecessor), as discussed below:
| ● | Service: Service expenses totaled $56,974,or 9.1% of total cost of revenue, during the three months ended August 31, 2025 (Successor), compared with $54,602during the three months ended August 31, 2024 (Predecessor). For the nine months ended August 31, 2025 (Successor) and August 31, 2024 (Predecessor), service expenses totaled $176,984, or 9.0% of total cost of revenue, and $141,665or 7.7% of total cost of revenue respectively. These increases were primarily attributable to higher insurance premiums and technology-related upgrades, including route management software and the replacement and data usage of handheld scanner devices. |
| ● | Labor: Labor expenses remained the largest component of our costs of revenue, totaling $347,945, or 55.5% during the three months ended August 31, 2025 (Successor), an increase of $17,198, or 5.2%, compared with the three months ended August 31, 2024 (Predecessor). Labor expenses for the nine months ended August 31, 2025 (Successor) totaled $1,085,885, or 55.3% of total cost of revenues, compared with $971,560, or 53.2%, of total cost of revenues for the nine months ended August 31, 2024 (Predecessor). These increases reflected higher service volume and staffing adjustments driven by increased activity-based service. |
| ● | Maintenance and Repair: Maintenance and repair expense decreased by $8,440, or 11.8%, to $63,143 during the three months ended August 31, 2025 (Successor), compared with $71,583 for the three months ended August 31, 2024 (Predecessor). This decrease occurred primarily as a result of route and scheduling improvements achieved since the Acquisition Date, as well as enhanced "gentle driving" training and performance-based incentives that encourage drivers to properly maintain their vehicles. Maintenance and repair expense decreased by $8,938, or 4.1% to $207,709 during the nine months ended August 31, 2025 (Successor), compared with $216,647 for the nine months ended August 31, 2024 (Predecessor). Maintenance and repair |
| expense reflected higher deferred maintenance activities performed during the JAR post-acquisition period in the first fiscal quarter of 2025, partially offset by decreased daily maintenance expenditures in the second and third fiscal quarters of 2025. |
| ● | Depreciation and Amortization: Depreciation and amortization expenses totaled $64,332 during the three months ended August 31, 2025 (Successor), an increase of $3,714, or 6.1%, over the comparable Predecessor period. For the nine months ended August 31, 2025 (Successor), depreciation and amortization expense totaled $188,668, up $8,223 or 4.6%, over the comparable Predecessor period. Amortization of intangible assets, which we recorded after the JAR acquisition, accounted for the increase while depreciation remained relatively unchanged. |
| ● | Fuel: Fuel expense decreased by $7,960, or 7.8%, to $94,654 for the three months ended August 31, 2025 (Successor). The decrease of fuel, compared with the activity-based increase of revenue, was primarily driven by improved route planning and enhanced driver operations, which contributed to more efficient fuel utilization and lower average mileage per route, and the introduction of new electric trucks into operations beginning this fiscal quarter. For the nine months ended August 31, 2025 (Successor), fuel expense decreased by $13,877, or 4.4%, to $304,600 primarily due to improved energy management and route planning over the comparable Predecessor period. |
Gross Profit (Loss)
For the three months ended August 31, 2025 (Successor), we recorded our first gross profit of $6,817, or 1.1% of total revenue, compared with a gross loss of $29,789, or (5.0)%, for the three months ended August 31, 2024 (Predecessor). The increase of $36,606 was primarily driven by increased revenue.
For the nine months ended August 31, 2025 (Successor), we recorded a gross loss of $7,588, or (0.3)% of total revenue, compared with a gross loss of $14,479, or (0.7)% of total revenue for the nine months ended August 31, 2024 (Predecessor). The increase of $6,891 was primarily driven by an increase in revenue.
General and Administrative Expenses
The following table sets forth the breakdown of our general and administrative expenses for the periods presented.
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2024 |
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2025 |
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2024 |
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(Predecessor) |
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Change |
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(Predecessor) |
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Change |
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Amount |
% |
Amount |
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Amount |
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Amount |
% |
Amount |
% |
Amount |
% |
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General and administrative expenses |
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Professional fees |
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$ |
53,449 |
35.3 |
% |
$ |
22,390 |
57.0 |
% |
$ |
31,059 |
138.7 |
% |
$ |
314,655 |
54.5 |
% |
$ |
66,978 |
61.8 |
% |
$ |
247,677 |
369.8 |
% |
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Payroll Expense |
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76,853 |
50.7 |
% |
- |
- |
% |
76,853 |
100.0 |
% |
228,542 |
39.6 |
% |
- |
- |
% |
228,542 |
100.0 |
% |
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Others |
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21,298 |
14.0 |
% |
16,890 |
43.0 |
% |
4,408 |
26.1 |
% |
33,784 |
5.9 |
% |
41,321 |
38.2 |
% |
(7,537) |
(18.2) |
% |
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Total general and administrative expenses |
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$ |
151,600 |
100.0 |
% |
$ |
39,280 |
100.0 |
% |
$ |
112,320 |
285.9 |
% |
$ |
576,981 |
100.0 |
% |
$ |
108,299 |
100.0 |
% |
$ |
468,682 |
432.8 |
% |
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For the three months ended August 31, 2025 (Successor), general and administrative expenses were $151,600, compared with $39,280 for the three months ended August 31, 2024 (Predecessor), representing an increase of $112,320, or 285.9%. The current period included $53,449 in legal and accounting fees, primarily for audit services, financial reporting, and regulatory compliance related to our successful IPO and subsequent status as a public company. We also recorded $76,853 in payroll expenses associated with personnel supporting corporate governance, internal controls, and administrative operations that were not incurred in the comparable Predecessor period. Other categories, such as systems support and general office expenses, remained stable relative to the current operational scope.
For the nine months ended August 31, 2025 (Successor), general and administrative expenses were $576,981, compared with $108,299 for the nine months ended August 31, 2024 (Predecessor), representing an increase of $468,682, or 432.8%. The current period included $314,655 in legal and accounting fees, primarily for audit services, financial reporting, and regulatory compliance related to the JAR acquisition. We also recorded $228,542 in payroll expenses associated with personnel supporting corporate governance, internal
controls, and administrative operations that were not incurred in the comparable Predecessor period. Other categories, such as systems support and general office expenses, remained stable relative to the current operational scope.
Other Income (Expenses)
Interest income (expense), net
Interest income was $2,248 for the three and nine months ended August 31, 2025 (Successor), compared with an interest expense of $7,236 and $23,907, respectively, for the three and nine months ended August 31, 2024 (Predecessor). This improvement was primarily attributable to investing the proceeds from the IPO and that we assumed no debt obligations as part of the JAR acquisition and therefore incurred no interest expense.
Other Income (expense), net
Other income (expense), net for the three months ended August 31, 2025 (Successor) was nil and was insignificant for the three months ended August 31, 2024 (Predecessor). Other income, net for the nine months ended August 31, 2025 (Successor) was $21,285, compared with $2,964 for the nine months ended August 31, 2024 (Predecessor), Other income, net recorded in the nine months period of 2025 consisted mainly of net commission income during the effective periods of stock purchase agreements with two independent last-mile delivery service providers. On January 18, 2025, we entered into separate stock purchase agreements with two last-mile delivery service providers, Wandun Enterprise Inc ("Wandun") and WJ Management Inc ("WJ"), along with all of their respective stockholders, to acquire the 100% equity interest in each company. The purchases became effective on February 7, 2025 and were terminated on March 28, 2025. The terminations were primarily driven by the fact that, following our assumption of operational control, the financial performance of the target businesses did not meet our expectations. The income we earned under these agreements during the time they were in force was recognized as other income.
Income Tax Provision
Our income tax provision was $43,346 for the three months ended August 31, 2025 (Successor), compared with an income tax provision of $0 for the three months ended August 31, 2024 (Predecessor) due to the tax provision adjustment in Q3 2025 related to nondeductible IPO-related costs.
We recorded a tax benefit of $62,552, for the nine months ended August 31, 2025 (Successor), compared with a provision of $800 for the nine months ended August 31, 2024 (Predecessor). The realization of a tax benefit was mainly driven by the loss before income taxes we incurred during the nine months ended August 31, 2025 (Successor).
Net Loss
As a result of the above factors, for the three months ended August 31, 2025 (Successor), we reported a net loss of $185,881, compared with a net loss for the three months ended August 31, 2024 (Predecessor) of $76,526. For the nine months ended August 31, 2025 (Successor), we reported a net loss of $498,484, compared with a net loss for the nine months ended August 31, 2024 (Predecessor) of $144,521.
Cash Flows for the Nine Months ended August 31, 2025(Successor) and August 31, 2024(Predecessor)
The following table summarizes our cash flows for the periods presented:
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Successor |
Predecessor |
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For the Nine Months |
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For the Nine Months |
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Ended August 31, 2025 |
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Ended August 31, 2024 |
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Net cash (used in) provided by operating activities |
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$ |
(640,210) |
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$ |
157,921 |
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Net cash used in investing activities |
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(79,908) |
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- |
||
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Net cash provided by (used in) financing activities |
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14,103,098 |
|
(165,878) |
||
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Net increase (decrease) in cash |
|
$ |
13,382,980 |
|
$ |
(7,957) |
Operating Activities
Net cash used in operations was $640,210 for the nine months ended August 31, 2025 (Successor) compared with net cash provided by operations of $157,921 during the nine months ended August 31, 2024 (Predecessor). The change was primarily due to the increase in net loss, the reduction in our tax benefit as the result of incurring an income tax provision in the third fiscal quarter, and a reduction in accounts payable as we paid the remaining costs related to our IPO.
Investing Activities
Net cash used in investing activities was $79,908 for the nine months ended August 31, 2025 (Successor) due to the purchase of new electronic delivery vehicles.
Financing Activities
Net cash provided by financing activities of $14,103,098 for the nine months ended August 31, 2025 (Successor), was mainly contributed by the proceeds from our IPO.
Net cash used in financing activities amounted to $165,878 for the nine months ended August 31, 2024 (Predecessor), mainly consisted of repayments of long-term borrowings of $176,335.
Contractual Obligations and Other Commitments
We have no long-term fixed contractual obligations or commitments as of August 31, 2025.
Liquidity and Capital Resources
We have incurred net losses and negative cash flows since inception. For the nine months ended August 31, 2025, we reported a net loss of $0.5 million and used $0.6 million of cash in operating activities. As of August 31, 2025, we had an accumulated deficit of $0.8 million. On August 20, 2025, we completed our initial public offering ("IPO") resulting in net proceeds of approximately $13.7 million, after deducting underwriting discounts and commissions and offering expenses payable by us. Management believes that the current cash, including the net proceeds from the IPO, will be sufficient to fund its operating and capital expenditure requirements in excess of the next 12 months from the issuance date of these financial statements.
In February 2025, we obtained two separate $2.0 million revolving credit facilities from major stockholders providing an additional liquidity buffer of $4.0 million (see Note 12(f)). Borrowings under these facilities are repayable at the end of the 24-month term but may be extended for an additional 12 month term. As of August 31, 2025, we had not drawn under these revolving credit facilities.
Our future capital requirements will depend on many factors, including the rate of revenue growth, the timing and amount of cash received from customers, the expansion of sales and marketing activities, the timing and cost of new service efforts, and the success of its efforts to expand business with its current client and to acquire additional businesses. We may require additional equity or debt financing to fund its future operations. There can be no assurance that such financing will be available on acceptable terms, or at all. If we are unable to raise additional capital when needed, it could be forced to delay, reduce, or eliminate its research and development programs or future commercialization efforts, which could adversely affect its business prospects.
Critical Accounting Policies and Estimates
We prepare our financial statements in conformity with the accounting principles generally accepted in the U.S. ("U.S. GAAP"), which require us to make judgments, estimates, and assumptions that affect our reported amount of assets, liabilities, revenue, costs and expenses, and any related disclosures. Although there were no material changes made to the accounting estimates and assumptions in the past fiscal year, we continually evaluate these estimates and assumptions based on the most recently available information, our own historical experience and various other assumptions that we believe to be reasonable under the circumstances. Since the use of estimates is an integral component of the financial reporting process, actual results could differ from our expectations as a result of changes in our estimates.
As of the date of this quarterly report, there have been no material changes to our critical accounting policies as discussed under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations-Critical Accounting Policies" in our registration statement on Form S-1 (File No. 333-286965), as amended, which was initially filed with the SEC on May 5, 2025 and declared effective by the SEC on August 20, 2025.
Elite Express Holding Inc. published this content on October 14, 2025, and is solely responsible for the information contained herein. Distributed via EDGAR on October 14, 2025 at 10:21 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]