Company: AGCC
Filing Date: 2025-06-03
Form Type: DRS/A
Source: 0001213900-25-050599
Chunk: 26

Company: Agencia Comercial Spirits Ltd.
Filing Date: 2025-06-03
Form: DRS/A
Chunk 26
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 orders for additional products, which would also unfavorably impact our sales and adversely affect our operating results. If our inventory is lost due to theft, fire, or other damage, or becomes obsolete, our results of operations would be negatively impacted. We expect our inventory levels to fluctuate to meet customer delivery requirements for our products. There is always a risk of loss of this inventory due to theft, fire or other damage, and any such loss, whether insured or not, could cause us to fail to meet our orders and harm our sales and operating results. In addition, our inventory may become obsolete as we introduce new products, cease to produce old products, or modify the design of our products’ packaging, which would increase our operating losses and negatively impact our results of operations. For example, in the whisky industry, the aging process can result in losses known as the “angel’s share,” in which a portion of the liquid evaporates through the porous wood of the barrel. This natural loss, along with potential obsolescence due to changes in consumer preferences or packaging updates, can affect our inventory levels and profitability. Our business is subject to seasonality related to sales of our products. The whisky market experiences considerable seasonal fluctuations. Historically, a significant portion of net sales and earnings in the whisky industry occurs during the holiday season, particularly in November and December. This period is marked by increased social gatherings, family parties, and gift -giving, which drive higher demand for whisky. Additionally, the summer months, particularly June through August, also see a rise in sales due to outdoor activities and social events where whisky is a popular choice. As a result, our operating results may fluctuate significantly from quarter to quarter, and the outcomes for any given quarter are not necessarily indicative of results for other periods. If our sales were to decline substantially below these seasonal norms for any reason, our annual revenues and earnings could be materially and adversely affected. 18 Our two largest customers accounted for a significant portion of our total revenue for the year ended Dece mber 31, 202 4. We derive a substantial portion of our revenue from a limited number of major customers. For the year ended December31, 2024, our two largest customers in aggregate accounted for approximately 59.1% of our total revenue for the year, of which Customer A accounting for over 41.4% of our sales volume in 2024 and Customer B accounting for over 17.7% of our sales volume in 2024. There is no assurance