Company: AGSS
Filing Date: 2025-05-12
Form Type: 10-K
Source: 0001829126-25-003553
Chunk: 242

Company: AMERIGUARD SECURITY SERVICES, INC.
Filing Date: 2025-05-12
Form: 10-K
Item: Item 3
Chunk 242
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    Oct 2024 through Sep 2029
    Annual Revenue of approx. $720K

    ●
    Veterans Administration – Loma Linda CA
    
    -
    
    Oct 2024 through Sep 2029
    Annual Revenue of approx. $2.1M

As with all professional service industries, most
of the expense is direct labor and expenses associated with that labor. We are not an exception. Our direct expenses average around 89%
of revenues. Total direct cost of services was approximately $23,400,000 in 2024 and approximately $19,160,000 in 2023.

The total direct cost of services saw an increase
of approximately $4,300,000, or 22%. This increase was expected due to the direct expenses of labor and vehicles of including a full year
of TUS direct expenses. The Company acquired TUS in the fourth quarter of 2023, so there were only 2 months of expenses reflected in 2023.
The increase is the net result of an increase in direct labor expenses in the amount of $2,700,000, an increase of approximately $2,000,000
in vehicle expenses. These increases were offset by a decrease in total subcontractor expenses of approximately $483,000. The gross margin increased approximately $1,200,000, a 66% increase. As a percentage, the gross margin percentage increased to
11.3% in 2024 from 8.6% in 2023.

9

Operating Expenses and Other Expense

Operation expenses increased in 2024 over 2023
by approximately $2,168,000. The largest category of increase was in loan interest, of approximately $1,220,000, resulting from utilizing
several high-interest loans necessary to cover the operational capital needs. Professional services experienced an increase of approximately
$529,000. Approximately $250,000 of this increase resulted from a class action lawsuit filed alleging labor law violations. Additionally,
there was an increase in the general and administrative expenses of approximately $157,000. Within the general and administrative expenses,
outside services expenses increased approximately $100,000. Advertising and marketing experience and increase of approximately $120,000.
TUS expenses the graphics put on the vans in this category and added 41 vans in 2024, total cost $90,235. AGC redesigned its website
and added social media advertising to increase guard services revenue. This program ended in October.