PR Newswire | Apr 26, 2021 06:00PM EDT

04/26 17:00 CDT

DH Holdings, Inc. Reports Full Year 2020 Audited Financial Results QINGDAO, China, April 26, 2021

QINGDAO, China, April 26, 2021 /PRNewswire/ -- TDH Holdings, Inc. (NASDAQ: PETZ) ("TDH" or the "Company"), a PRC-based company that specializes in the development, manufacturing and sales of pet food products in China and beyond, announced today its financial results for the twelve months ended December 31, 2020.

Full Year 2020 Financial Highlights:

For the Twelve Months Ended December 31,

($ millions, except per share data) 2020 2019 % Change

Revenues $0.82 $12.65 -93.55%

Gross loss ($0.04) ($1.52) 97.25%

Gross loss margin -5.13% -12.04% 6.91 pp*

Loss from operations ($1.93) ($6.96) 72.32%

Operating loss margin -236.25% -55.02% -181.23 pp*

Net loss attributable to ($0.87) ($8.63) 89.86%common stockholders

Loss per share - basic and ($0.02) ($0.41) 95.35%diluted

* pp: percentage points

* Revenues decreased by 93.55% from $12.65 million in fiscal year 2019 to $0.82 million in fiscal year 2020, with decrease in sales from overseas markets, domestic market and E-commerce platform. The decrease in total revenues in 2020 was mainly due to: (1) decrease in sales orders due to our uncompetitive sales prices for our products which made them less attractive to our customers; (2) partially suspension of our overseas E-commerce business due to the estimated gross loss; (3) suspension of our production and operations commencing in November 2019 and ending in May 2020 due to our defaults on loan repayments to financial institutions, claims from our suppliers and creditors and labor arbitration derived from our cutting down certain employees. The COVID-19 outbreak and spread further caused disruption in our supply chain, transportation and our sales activities from the beginning of 2020 to May 2020. As a result, we had the inability to fulfill customer orders on a timely manner and we received reduced sales orders from our customers and our sales volume significantly decreased in 2020 as compared to 2019. * Gross loss was $0.04 million in fiscal year 2020 as compared to gross loss of $1.52 million in fiscal year 2019. The decrease in gross loss was a result of stop taking unprofitable orders, and the slightly improvement of our cost management. * Operating loss was $1.93 million in fiscal year 2020 as compared to operating loss of $6.96 million in 2019. The continuous deficit from operation was mainly due to the fact that our sales revenue continued to decrease, while we continued to incur fixed overhead costs and high operating expenses during 2020. The decrease in loss from operations was the combined result of improvement in gross margin and decrease in our total operating expenses in 2020 as compared to 2019. * Net loss attributable to common stockholders was $0.87 million, or a loss per share of $0.02, for the year of 2020 as compared to net loss of $8.63 million, or a loss per share of $0.41, for 2019.

Full Year 2020 Financial ResultsRevenuesThe Company generates its revenues from product sales, mainly including sales for pet chews, dried pet snacks and wet canned pet foods in oversea markets, domestic markets and by e-commerce platform. Revenue consists of the invoiced value for the sales, net of value-added tax ("VAT"), business tax, and applicable local government levies. For the year of 2020, total revenues decreased by $11.83 million, or 93.55%, to $0.82 million from $12.65 million in 2019. The decrease in total revenues in 2020 was mainly due to: (1) decrease in sales orders due to the uncompetitive selling prices of our products which made our products less attractive to our customers; (2) partial suspension of our overseas E-commerce business due to the estimated gross loss; (3) suspension of our production and operations commencing in November 2019 and ending in May 2020 due to our defaults on loan repayments to financial institutions, claims from our suppliers and creditors and labor arbitration derived from our cutting down certain employees. The COVID-19 outbreak and spread further caused disruption in our supply chain, transportation and our sales activities from the beginning of 2020 to May 2020. As a result, we had the inability to fulfill customer orders on a timely manner and we received reduced sales orders from our customers and our sales volume significantly decreased in 2020 as compared to 2019.

For the Twelve Months Ended December 31,

2020 2019 Y/Y Change

Revenues % of Revenues % of Amount % ($'000) Total ($'000) Total ($'000)

Overseas $ 226 27.77% $ 9,995 79.02% $ -9,769 -97.74%

Domestic 575 70.52% 2,711 21.44% -2,137 -78.80%

E-commerce 17 2.05% 84 0.66% -67 -80.06%

less: salestax and -3 -0.34% -142 -1.12% 139 -98.04%additionalsurcharge

Total $ 815 100.00% $ 12,648 100.00% $ -11,833 -93.55%

Overseas sales decreased by $9.77 million, or 97.74%, to $0.23 million for the year of 2020 from $10.00 million for 2019. Domestic sales decreased by $2.14 million, or 78.80%, to $0.57 million for the year of 2020 from $2.71 million for 2019. The decrease was due to the decrease in sales orders due to our uncompetitive sales price, the COVID-19 outbreak and spread further caused disruption in our supply chain, transportation and our sales activities from the beginning of 2020 to May 2020. Sales from the e-commerce channel decreased by $0.07 million, or 80.06%, to $0.02 million for the year of 2020 from $0.08 million for 2019, due to suspension of our overseas E-commerce business as the losses continue to grow.

For the Twelve Months Ended December 31,

2020 2019 Y/Y Change

Revenues % of Revenues % of Amount % ($'000) Total ($'000) Total ($'000)

Pet chews $ 59 7.25% $ 6,470 51.15% $ -6,411 -99.09%

Dried pet snacks 318 38.94% 4,618 36.51% -4,301 -93.13%

Wet canned pet food 84 10.32% 1,310 10.36% -1,226 -93.58%

Dental health snacks 20 2.44% 305 2.41% -285 -93.48%

Baked pet biscuits 3 0.38% 87 0.69% -84 -96.42%

Others 334 41.01% - 0% 334 100.00%

Less: sales tax and -3 -0.34% -142 -1.12% 139 -98.04%additional surcharge

Total $ 815 100.00% $ 12,648 100.00% $ -11,833 -93.55%

Sales of pet chews decreased by $6.41 million, or 99.09%, to $0.06 million for the year 2020 from $6.47 million for 2019. Sales of dried pet snacks decreased by $4.3 million, or 93.13%, to $0.32 million for the year 2020 from $4.62 million for 2019. Sales of wet canned pet food decreased by $1.23 million, or 93.58%, to $0.08 million for the year 2020 from $1.31 million for 2019. Sales of dental health snacks decreased by $0.29 million, or 93.48%, to $0.02 million for the year 2020 from $0.31 million for 2019. These decreases were due to the decrease in sales orders due to our uncompetitive selling prices, the COVID-19 outbreak and spread further caused disruption in our supply chain, transportation and our sales activities from the beginning of 2020 to May 2020. Sales of pet chews, dried pet snacks, wet canned pet food, and dental health snacks accounted for 7.25%, 38.93%, 10.32%, and 2.44%, respectively, for the year of 2020, compared to 51.15%, 36.51%, 10.36%, and 2.41%, respectively, for 2019.

Cost of revenuesCost of revenues consists primarily of raw materials, labor and factory overhead. Cost of revenues decreased by $13.31 million, or 93.95%, to $0.86 million for the year of 2020 from $14.17 million for 2019. This decrease in cost of revenues was mainly due to the 93.55% decrease in our total net revenue for the year ended December 31, 2020. As a percentage of revenues, cost of revenues was 105.13% for the year 2020, compared to 112.04% for 2019.

Gross loss and gross loss marginGross loss was $0.04 million for the year of 2020, compared to gross profit of $1.52 million for 2019. Gross loss margin was 5.13% for the year 2019, compared to gross loss margin of 12.04% for 2020.

Operating expenseOperating expense consists of selling expenses, general and administrative expenses and research and development expenses.

Selling expenses decreased by $0.8 million, or 87.18%, to $0.12 million for the year 2020 from $0.92 million for 2019. The decrease in our selling expense was in line with our reduced sales activities and decreased revenue in 2020.

General and administrative expenses decreased by $1.94 million, or 52.29%, to $1.77 million for the year 2020 from $3.70 million for 2019. The main reason for the decrease was because we have cut-down number of employees as a result of our business strategy adjustment when our business scale reduced in 2020, as a result, our salary paid to employees, office expenses incurred and business consulting expenses all decreased in 2020 as compared to 2019.

Impairment of long-lived assets other than goodwill charge was $Nil in 2020, as compared to $0.81 million in 2019.

As a result, total operating expenses decreased by $3.55 million, or 65.34%, to $1.88 million for the year of 2020 from $5.44 million for 2019. As a percentage of total revenues, total operating expenses was 231.11% for the year of 2020, compared to 42.98% for 2019.

Operating loss and operating loss marginLoss from operations was $1.93 million for the year of 2020, compared to operating loss of $6.96 million for 2019. The continuous loss from operation was mainly due to decreased sales revenue.

Net loss and loss per shareNet loss was $0.87 million for the year of 2020, compared to net loss of $8.63 million for 2019. Net loss attributable to common stockholders was $0.87 million, or loss per share of $0.02, for the year of 2020. This is compared to net loss attributable to common stockholders of $8.63 million, or loss per share of $0.41, for 2019.

Financial ConditionsAs of December 31, 2020, the Company had cash, cash equivalents and restricted cash of $6.75 million, compared to $6.50 million at December 31, 2019. Accounts receivable and inventories were $0.17 million and $0.25 million, respectively, as of December 31, 2020, compared to $0.02 million and $0.47 million, respectively, at the end of 2019. Total working capital deficit was $8.55 million as of December 31, 2020, as compared to working capital deficit of $7.27 million at the end of 2019.

Net cash used in operating activities was $2.63 million for the year of 2020, compared to $5.63 million for 2019. Net cash provided by investing activities was $3.36 million for the year of 2020, compared to $0.11 million for 2019. Net cash used in financing activities was $0.59 million for the year of 2020, compared to $9.52 million net cash provided by financing activities in 2019.

Going ConcernAs reflected in our consolidated financial statements, our revenue decreased by approximately $11.83 million from approximately $12.65 million in 2019 to approximately $0.82 million in 2020. Net cash used in operating activities amounted to approximately $2.63 million for the year ended December 31, 2020. As of December 31, 2020, we had working capital deficit of approximately $8.55 million as compared to working capital deficit of approximately $7.3 million as of December 31, 2019. In addition, starting from November 2019, we temporarily suspended our manufacturing activities due to operating inefficiency, the suspension of our manufacturing activities led to reduced sales and operating cash flows, and consequently caused our inability to make the payments to settle vendor bills and repay the bank loans upon maturity. As a result, in late 2019, some of our vendors and several financial institutions initiated lawsuits against us for payment. Our inability to resolve these matters satisfactorily had material adverse effect on the Company's financial condition in 2020. Furthermore, in December 2019, a novel strain of coronavirus (COVID-19) surfaced. COVID-19 spread rapidly throughout China and worldwide, which caused significant volatility in the PRC and international markets. There has been significant uncertainty around the breadth and duration of business disruptions related to COVID-19, as well as its impact on the PRC and international economies. To reduce the spread of the COVID-19, the Chinese government has employed measures including city lockdowns, quarantines, travel restrictions, suspension of business activities and school closures. Due to difficulties resulting from the COVID-19 outbreak and all the other aspects of our operating challenges, including, but not limited to, the extending temporary closure of our facilities and operations to until the middle of May 2020, pending lawsuits for supplier arrears, bank loans and employee compensation, limited support from the Company's employees, delayed access to raw material supplies, reduced customer sales orders, and our inability to promote the sales to customers on a timely basis, our revenue for the year ended December 31, 2020 decreased significantly. Furthermore, certain premises including factory building and warehouse have been frozen for a period of three years following a court order issued in April 2020. These facts raised substantial doubt about our ability to continue as a going concern for the next 12 months from the date of this report.

Our plan to alleviate the substantial doubt about our ability to continue as a going concern include attempting to improve our business profitability, our ability to generate sufficient cash flow from our operations to meet our operating needs on a timely basis, obtain additional working capital funds through debt and equity financings to eliminate inefficiencies in order to meet our anticipated cash requirements. We also plan to evaluate and identify suitable strategic or acquisition opportunities, complete such transactions on commercially favorable terms, or successfully integrate business operations, infrastructure and management philosophies of acquired businesses and companies. Given the operating difficulties and the COVID-19 outbreak, we resumed our business activities on May 18, 2020, with the support of the local government. We believe the negative impact of the COVID-19 coronavirus outbreak on our business to be temporary and for our sales activities have started to run as normal, which will help us to increase our sales in the near future. Due to the effects discussed above, to the extent that we experience a more adverse operating environment, incur unanticipated capital expenditures, or if we decide to accelerate our growth, then additional financing may be required. Currently, we are working to improve our liquidity and capital sources primarily through financial support from our principal shareholder and explore debt or equity financing possibilities. In order to fully implement our business plan and sustain continued growth, we may also need to raise capital from outside investors. On December 2, 2020, we entered into subscription agreements with four accredited investors for the sale of 9,100,000 of the Company's common shares at the price $0.30 per share for the gross proceeds of approximately $2.73 million. We received the $2.73 million proceeds in April 2021. Our expectation, therefore, is that we will seek to access the capital markets in both the U.S. and China to obtain additional funds as needed. At the present time, however, we do not have commitments of funds from any third party. No assurance can be given that additional financing, if required, would be available on favorable terms or at all. If we do not secure capital needed for our operations, we may have to temporarily suspend or cease our operations.

NoticeRounding amounts and percentages: Certain amounts and percentages included in this press release have been rounded for ease of presentation. Percentage figures included in this press release have not in all cases been calculated on the basis of such rounded figures, but on the basis of such amounts prior to rounding. For this reason, certain percentage amounts in this press release may vary from those obtained by performing the same calculations using the figures in the financial statements. In addition, certain other amounts that appear in this press release may not sum due to rounding.

About TDH Holdings, Inc.Founded in April 2002, TDH Holdings, Inc. (the "Company") (NASDAQ: PETZ), is a developer, manufacturer and distributer of a variety of pet food products under multiple brands that are sold in the China, Asia and Europe. More information about the Company can be found at www.tiandihui.com.

Safe Harbor StatementThis news release contains forward-looking statements. Without limiting the generality of the foregoing, words such as "may," "will," "expect," "believe," "anticipate," "intend," "could," "estimate" or "continue" or the negative or other variations thereof or comparable terminology are intended to identify forward-looking statements. These statements are only predictions, uncertainties and other factors may cause the Company's actual results, levels of activity, performance or achievements to be materially different from any future results, levels or activity, performance or achievements expressed or implied by these forward-looking statements. Specifically, the Company's statements regarding, among others, its growth and business outlook, the Company's ability to execute on its business plan, secure necessary capital to sustain and maintain its operations, its ability to resume its operations at the previous levels, its ability to successfully resolve various legal proceedings in which it is involved, are forward-looking statements. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict and many of which are beyond the control of the Company. Actual results may differ from those projected in the forward-looking statements due to risks and uncertainties that are described more fully in the Company's public reports filed with the U.S. Securities and Exchange Commission. Although the Company believes that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate and, therefore, there can be no assurance that the results contemplated in forward-looking statements will be realized. In light of the significant uncertainties inherent in the forward-looking information included herein, the inclusion of such information should not be regarded as a representation by TDH or any other person that their objectives or plans will be achieved. The Company does not undertake any obligation to revise the forward-looking statements contained herein to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

TDH HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

December 31, December 31,

2020 2019

ASSETS

CURRENT ASSETS:

Cash and cash equivalents $ 6,566,549 $ 5,114,175

Restricted cash 182,515 1,390,403

Short-term investments 3,138,578 -

Accounts receivable, net 168,499 21,657

Advances to suppliers, net 41,088 39,806

Inventories, net 247,245 473,216

Prepayments and other current assets, 172,481 153,633net

Total current assets 10,516,955 7,192,890

NON-CURRENT ASSETS:

Property, plant and equipment, net 6,636,995 6,562,669

Land use rights, net 1,009,005 973,224

Long-term investments - 71,757

Operating lease right-of-use assets 19,103 -

Operating lease right-of-use assets - 270,852 286,670related parties

Total non-current assets 7,935,955 7,894,320

Total assets $ 18,452,910 $ 15,087,210

LIABILITIES ANDSTOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:

Accounts payable $ 3,209,763 $ 3,436,939

Accounts payable - related parties 124,715 116,834

Notes payable - 908,008

Advances from customers 90,834 116,155

Bank overdrafts 78,320 78,320

Short-term loans 8,391,323 7,624,061

Short-term loans - related parties 985,883 892,510

Taxes payable 60,729 57,521

Due to related parties 42,021 39,387

Operating lease liabilities, current 9,913 -

Operating lease liabilities - related 195,231 137,347parties, current

Other current liabilities 5,882,164 1,054,818

Total current liabilities 19,070,896 14,461,900

NON-CURRENT LIABILITIES:

Deferred tax liabilities - 1,036

Operating lease liabilities - related 274,794 286,875party, non-current

Total liabilities 19,345,690 14,749,811

STOCKHOLDERS' EQUITY (DEFICIT):

Common stock ($0.001 par value;200,000,000 shares authorized;45,849,995 shares issued and 45,850 45,850outstanding at December 31, 2020 and2019)

Additional paid-in capital 21,963,570 21,963,678

Statutory reserves 160,014 160,014

Accumulated deficit -22,849,319 -21,974,651

Accumulated other comprehensive -212,895 142,516income (loss)

Total TDH Holdings, Inc. -892,780 337,407stockholders' equity (deficit)

Noncontrolling interest - -8

Total stockholders' equity (deficit) -892,780 337,399

Total liabilities and stockholders' $ 18,452,910 $ 15,087,210equity (deficit)

TDH HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

For The Years Ended December 31,

2020 2019 2018

Net revenue $ 815,225 $ 12,455,414 $ 22,154,506

Net revenue -related parties - 192,841 1,519,531

Total revenue 815,225 12,648,255 23,674,037

Cost of revenue 857,060 13,992,499 26,278,300

Cost of revenue - related parties - 178,636 1,448,533

Total cost of revenue 857,060 14,171,135 27,726,833

Gross loss -41,835 -1,522,880 -4,052,796

Operating expenses: -

Selling expense 117,993 920,237 4,535,945

General and administrative expense 1,766,109 3,702,035 2,792,858

Research and development expense - - 1,062,582

Impairment of long-lived assets other - 813,344 -than goodwill

Impairment of goodwill - - 1,599,591

Total operating 1,884,102 5,435,616 9,990,976expenses

Loss from operations -1,925,937 -6,958,496 -14,043,772

Interest expense -1,180,489 -1,378,755 -233,101

Government subsidies 8,651 129,255 81,882

Other income 137,163 1,189 20,242

Other expense -35,197 -290,655 -26,992

Investment income, net 2,120,241 - -

Loss from equity method investment - -127,965 -17,524

Total other income (expenses) 1,050,369 -1,666,931 -175,493

Loss before income tax benefit -875,568 -8,625,427 -14,219,265

Income tax benefit -900 - -

Net loss -874,668 -8,625,427 -14,219,265

Less: Net loss attributable to - -8 -40noncontrolling interest

Net loss attributable to TDH $ -874,668 $ -8,625,419 $ -14,219,225Holdings, Inc.

Comprehensive loss

Net loss $ -874,668 $ -8,625,427 $ -14,219,265

Other comprehensive loss

Foreign currency translation -355,411 -100,954 -65,123adjustment

Total comprehensive loss $ -1,230,079 $ -8,726,381 $ -14,284,388

Less: Comprehensive loss attributable - -8 -347to noncontrolling interest

Comprehensive loss attributable to $ -1,230,079 $ -8,726,373 $ -14,284,041TDH Holdings, Inc.

Loss per common share attributable toTDH Holdings, Inc.

Basic $ -0.02 $ -0.41 $ -1.49

Diluted $ -0.02 $ -0.41 $ -1.49

Weighted average common sharesoutstanding

Basic 45,849,995 21,022,598 9,558,493

Diluted 45,849,995 21,022,598 9,558,493

TDH HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

For The Years Ended December 31,

2020 2019 2018

Cash flows fromoperating activities

Net loss $ -874,668 $ -8,625,427 $ -14,219,265

Adjustments to reconcile net loss tonet cash used in operatingactivities:

Depreciation and amortization 391,351 571,528 395,355expense

Fair value change of short-term -2,120,241 - -investments

Loss from equity method investment - 127,965 17,524

Loss on disposal of subsidiaries - 5,018 -

Impairment of goodwill - - 1,599,591

Impairment of long-lived assets - 813,344 -other than goodwill

Inventory write-down 42,241 518,119 1,668,508

Allowance for credit losses 74,190 659,569 -

Deferred income taxes -1,106 -3,861 -591

Loss (gain) on disposal of property, -16,870 308,003 -plant and equipment

Non-cash lease expense 33,944 89,176 -

Gain on forgiveness of short-term $ -6,265 $ - $ -loan

Changes in operating assets andliabilities:

Accounts receivable, net -112,177 329,042 1,302,573

Accounts receivable - related - 306,301 -778,516parties, net

Inventories, net 201,730 2,009,862 4,203,927

Operating lease liabilities -9,382 - -

Operating lease liabilities - 16,262 16,404 -related parties

Due from related parties, net - -2,206 -

Due to related parties - 14,387 18,142

Advances to suppliers, net -12,179 36,322 569,723

Prepayments and other current -29,363 516,018 -291,336assets, net

Accounts payable -416,506 -2,775,356 1,870,157

Accounts payable - related parties - -6,703 19,848

Interest payable 1,065,277 260,417 119,712

Interest payable - related parties 43,835 - -

Notes payable - -1,046,257 1,204,910

Taxes payable - 13,797 32,733

Advances from customers -31,366 -42,923 -60,254

Advances from customer - related - - -7,397party

Other current liabilities -866,962 280,843 160,914

Net cash used in operating $ -2,628,255 $ -5,626,618 $ -2,173,742activities

Cash flows from investing activities

Payments to acquire property, plant -47,086 -121,560 -5,627,422and equipment

Proceeds from disposal of property, - 233,747 -plant and equipment

Payments to acquire land use rights - - -854,221

Acquisition of businesses, net of - - 19,888cash acquired

Disposal of subsidiaries - 83 -

Loans to related parties - - -132,147

Repayments from related parties - 1,282 235,049

Payments for long-term investments - - -235,605

Purchase of short-term investments -38,743,908 - -

Proceeds from sale of short-term 42,146,183 - -investments

Net cash provided by (used in) $ 3,355,189 $ 113,552 $ -6,594,458investing activities

Cash flows from financing activities

Proceeds from issuance of common - 6,760,000 -shares

Purchase of noncontrolling interest -100 - -

Collection of stock subscription - - 100,000receivable

Proceeds from related parties - - 5,306

Repayments to related parties - -1,000 -385,420

Proceeds from bank overdrafts - 78,162 -

Proceeds from short-term loans 107,829 1,046,275 8,400,090

Repayments of short-term loans -746,437 -2,073,177 -1,508,056

Proceeds from short-term loans - 49,350 4,791,403 1,176,690related parties

Repayments of short-term loans - - -1,080,947 -60,490related parties

Net cash provided by (used in) $ -589,358 $ 9,520,716 $ 7,728,120financing activities

Effect of exchange rate changes oncash, cash equivalents and 106,910 -203,577 96,808restricted cash

Net change in cash, cash equivalents 244,486 3,804,073 -943,272and restricted cash

Cash, cash equivalents andrestricted cash, beginning of the 6,504,578 2,700,505 3,643,777year

Cash, cash equivalents and $ 6,749,064 $ 6,504,578 $ 2,700,505restricted cash, end of the year

Supplemental cash flow information

Interest paid $ 38,362 $ 1,118,338 $ 113,389

Income taxes paid $ 146 $ - $ -

Non-cash investing and financialactivities

Accrued interest added to short-term $ - $ 126,697 $ -loan - related party

Operating expenses paid by related $ - $ - $ 157,094parties

Liabilities assumed in connectionwith purchase of property, plant and $ 14,592 $ 51,196 $ 38,636equipment

Notes payable reclassified to $ 908,850 $ 479,724 $ -short-term loans

Receivables from related partiessettled with payables to related $ - $ 28,694 $ 114,707parties

Receivables from common stocksubscription settled with loan $ - $ 4,240,000 $ -payables to a related party

Shares issuance in connection with $ - $ - $ 1,053,020acquisition of subsidiaries

Short-term loans settled bytransferring an equity investment to $ 70,708 $ - $ -the creditor

Reconciliation of cash, cashequivalents, and restricted cash tothe consolidated balance sheets

Cash and cash equivalents $ 6,566,549 $ 5,114,175 $ 893,020

Restricted cash $ 182,515 $ 1,390,403 $ 1,807,485

Total cash, cash equivalents, and $ 6,749,064 $ 6,504,578 $ 2,700,505restricted cash

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SOURCE TDH Holdings, Inc.