Company: FGI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001628280-25-015656
Chunk: 122

Company: FGI Industries Ltd.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 7
Chunk 122
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4 million for the year ended December 31, 2024. This change primarily reflects strategic investments and working capital fluctuations. While 2024 saw a net loss, we continue to focus on long-term growth initiatives. Increases in accounts receivable and prepayments, as well as payments of operating lease liabilities, reflect our expanding operations and commitments. At the same time, higher accounts payable and a reduction in prepayments and other current assets provided a partial offset, demonstrating improved efficiency in managing liabilities.

Net cash provided by operating activities was approximately $2.2 million for the year ended December 31, 2023. This positive cash flow was primarily driven by a reduction in inventory and other current assets, reflecting improved inventory management and efficient working capital utilization. These benefits were partially offset by an increase in prepayments and other receivables, which resulted from higher advance payments to suppliers and other operational commitments. Additionally, a decrease in operating lease liabilities contributed to lower net cash inflows. Furthermore, an increase in accounts receivable impacted cash flow, reflecting higher sales on credit terms.

Investing Activities

Net cash used in investing activities was approximately $2.9 million and $1.8 million for the years ended December 31, 2024 and 2023, respectively, which was attributable to the purchases of property and equipment and intangible assets.

Financing Activities

Net cash provided by financing activities was approximately $7.5 million for the year ended December 31, 2024 compared to net cash used in financing activities of $2.8 million for the year ended December 31, 2023. During 2023, we made net repayments on the revolving credit facility, resulting in an overall cash outflow in financing activities. The shift to net cash inflows in 2024 highlights our focus on enhancing liquidity and financial flexibility in response to evolving business needs and growth opportunities.

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Commitments and Contingencies

Capital Expenditures

Our capital expenditures were incurred primarily in connection with the acquisition of property and equipment and intangible assets. Our capital expenditures amounted to approximately $2.9 million and $1.8 million for the years ended December 31, 2024 and 2023, respectively. We do not expect to incur significant capital expenditures in the immediate future.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements including arrangements that would affect our liquidity, capital resources, market risk support and credit risk support or other benefits.

Critical Accounting Policies

The consolidated financial statements