Company: HFFG
Filing Date: 2025-08-11
Form Type: 10-Q
Source: 0001628280-25-039583
Chunk: 79

Company: HF Foods Group Inc.
Filing Date: 2025-08-11
Form: 10-Q
Item: Item 8
Chunk 79
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Denominator:Weighted-average common shares outstanding52,969,037 52,585,715 52,853,982 52,370,842 Effect of dilutive securities445,678 75,404 — — Weighted-average dilutive shares outstanding53,414,715 52,661,119 52,853,982 52,370,842 Earnings (Loss) per common share:Basic$0.02 $— $(0.01)$(0.01)Diluted$0.02 $— $(0.01)$(0.01)

Note 10 - Income Taxes

The determination of the Company’s overall effective income tax rate requires the use of estimates. The effective income tax rate reflects the income earned and taxed in U.S. federal and various state jurisdictions based on enacted tax law, permanent differences between book and tax items, tax credits and the Company’s change in relative income in each jurisdiction. Changes in tax laws and rates may affect recorded deferred tax assets and liabilities and the Company’s effective income tax rate in the future. As of June 30, 2025, the Company had one subsidiary outside the U.S. that generated an insignificant amount of activity. As such, no foreign income tax was recorded.For the three and six months ended June 30, 2025, the Company’s effective income tax rate of 50.5% and 28.7%, respectively, differed from the federal statutory tax rate primarily as a result of permanent differences and state income taxes, partially offset 

13

by tax credits. The company’s tax provision for the three and six months ended June 30, 2025 includes a discrete tax expense of $500 related to stock-based compensation shortfalls. For the three and six months ended June 30, 2024, the Company’s effective income tax rate of 87.2% and 129.6%, respectively, differed from the federal statutory tax rate primarily as a result of discrete tax items, permanent differences and state income taxes. The Company’s tax provision for the three and six months ended June 30, 2024 included a discrete tax expense of $1.0 million related to the Company’s SEC settlement and $0.1 million tax expense related to stock-based compensation shortfalls. Absent the discrete items, the estimated annual effective income tax rate from continuing operations for the three and six months ended June 30, 2024 was 25.