Company: RETO
Filing Date: 2025-05-09
Form Type: 20-F
Source: 0001213900-25-041195
Chunk: 63

Company: ReTo Eco-Solutions, Inc.
Filing Date: 2025-05-09
Form: 20-F
Item: Item 19
Chunk 63
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 approximately $1.8million, or16,865%,
from approximately $10,781in the year ended December 31, 2023 to approximately $1.8million in the year ended December 31, 2024; its
gross profit from continuing operations increased by approximately $0.8million, or53,450%, from approximately $1,541in the year ended
December 31, 2023 to approximately $0.8million for the year ended December 31, 2024; and its gross margin for the year ended December
31, 2024 increased to45% from14% for the prior year. For the years ended December 31, 2024 and 2023, the Company incurred significant
impairment losses on bad debt expenses on uncollectible accounts receivable and advance payments due to changes in the market conditions
of its customers and suppliers. As a result, for the years ended December 31, 2024, 2023 and 2022, the Company reported a net loss of
approximately $8.4million, $16.1million and $15.4million, respectively. As of December 31, 2024, the Company had a working deficit
of approximately $2.6million.

As of December 31, 2024, the Company had cash
of approximately $0.7million. In addition, the Company had outstanding accounts receivable of approximately $0.1million, of which approximately
$0.1million, or100%, were subsequently collected and became available for use as working capital. As of December 31, 2024, the Company
had no outstanding bank loans.

The Company is working to improve its liquidity and capital source
mainly through cash flow from its operations, renewal of bank borrowings, and borrowing from related parties. In order to fully implement
its business plan and sustain operations, the Company may also seek equity financing from outside investors. At the present time, however,
the Company does not have commitments of funds from any potential investors. No assurance can be given that additional financing, if required,
would be available on favorable terms or at all.

Based on above reasons, there is substantial doubt
about the Company’s ability to continue as a going concern for the next 12 months from the issuance of these consolidated financial
statements.

NOTE 4 - DISCONTINUED OPERATIONS

The Company’s subsidiary REIT Holdings (China) Limited (“ REIT