TIRX Tian Ruixiang Holdings Ltd

TIAN RUIXIANG Holdings Ltd (Nasdaq: TIRX) (the "Company"), a China-based insurance broker conducting business through its variable interest entity in China, today announced its financial results for the fiscal year ended October 31, 2023.

Ms. Sheng Xu, the Chief Executive Officer of the Company, commented, “For the year ended October 31, 2023, the Company generated revenue of about $1.2 million, representing an 8.0% decrease compared to the prior year's revenue. This decline was primarily attributable to the lower commissions from several insurance products and loss of certain insurance company partners amid an increasingly competitive market and challenging macroeconomic environment in China.”

“However, we achieved a significant increase of approximately $612,000 in the commissions from our liability insurance products, driven by our efforts to expand our liability insurance business.”

“Despite the revenue decline, we were able to reduce the net loss by 47.6% to $2.5 million, down from $4.7 million in the prior year. Overall, while we faced headwinds in certain insurance products, we were able to drive substantial growth in the liability insurance commissions, which is a positive indicator for the Company's strategic focus. Additionally, the reduction in the net loss demonstrates improved financial performance and operational efficiency compared to the prior year.”

Selected Fiscal Year 2023 Financial Metrics

		Years Ended October 31,						Changes in
($ in millions, except per share data, differences due to rounding.)		2023			2022			Percentage
Revenues		$	1.2		$	1.4		(8.0)	%
Total operating expenses			4.3			6.4		(33.6)	%
Loss from operations			(3.0)			(5.1)		(40.5)	%
Net loss			(2.5)			(4.7)		(47.6)	%
Loss per share			(3.87)			(9.03)		(55.4)	%

• Revenue decreased by 8.0% to $1.2 million for the year ended October 31, 2023, compared with $1.4 million for the same period in 2022.
• Total operating expenses were $4.3 million for the year ended October 31, 2023, decreased from $6.4 million for the same period in 2022.
• Loss from operations narrowed by 40.5% to $3.0 million for the year ended October 31, 2023, from $5.1 million for the same period in 2022.
• Net loss also decreased by 47.6% to $2.5 million for the year ended October 31, 2023, from $4.7 million for the same period in 2022.

About TIAN RUIXIANG Holdings Ltd

TIAN RUIXIANG Holdings Ltd, headquartered in Beijing, China, is an insurance broker operating in China through its China-based variable interest entity. It distributes a wide range of insurance products, which are categorized into two major groups: (1) property and casualty insurance, such as commercial property insurance, liability insurance, accidental insurance, and automobile insurance; and (2) other types of insurance, such as health insurance, life insurance, and other miscellaneous insurance. For more information, visit the company's website at http://ir.tianrx.com/.

Forward-Looking Statements

Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review risk factors that may affect its future results in the Company's registration statement and in its other filings with the U.S. Securities and Exchange Commission.

For investor and media enquiries, please contact:

TIAN RUIXIANG Holdings LtdInvestor Relations DepartmentEmail: ir@tianrx.com

Wealth Financial Services LLCConnie KangPartnerEmail: ckang@wealthfsllc.comTel: +86 1381 185 7742 (CN)

TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIESCONSOLIDATED BALANCE SHEETS(IN U.S. DOLLARS)
		As of October 31,
		2023				2022
ASSETS
CURRENT ASSETS:
Cash		$	2,383			$	2,508
Restricted cash			692,692				692,734
Short-term investments			26,797,081				26,179,662
Accounts receivable			18,960				51,202
Note receivable			—				7,500,000
Interest receivable			—				262,192
Due from related party			—				1,369
Other current assets			107,508				168,957
Total Current Assets			27,618,624				34,858,624
NON-CURRENT ASSETS:
Note receivable			7,800,000				—
Property and equipment, net			6,280				8,688
Right-of-use assets, operating leases, net			54,870				143,438
Other non-current assets			—				20,078
Total Non-current Assets			7,861,150				172,204
Total Assets		$	35,479,774			$	35,030,828
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Taxes payable		$	623,825			$	466,878
Salary payable			726,330				424,987
Accrued liabilities and other payables			481,801				384,893
Due to related parties			1,173,510				126,530
Operating lease liabilities			57,402				90,800
Total Current Liabilities			3,062,868				1,494,088
NON-CURRENT LIABILITIES:
Operating lease liabilities - noncurrent portion			—				54,718
Total Non-current Liabilities			—				54,718
Total Liabilities			3,062,868				1,548,806
EQUITY:
TIAN RUIXIANG Holdings Ltd Shareholders' Equity:
Ordinary shares: $0.025 par value; 40,000,000 shares authorized;
Class A ordinary shares: $0.025 par value; 36,000,000 shares authorized; 674,949 shares issued and outstanding at October 31, 2023; 507,440 shares issued and 505,440 shares outstanding at October 31, 2022			16,874				12,636
Class B ordinary shares: $0.025 par value; 4,000,000 shares authorized; 50,000 shares issued and outstanding at October 31, 2023 and 2022			1,250				1,250
Additional paid-in capital			44,108,774				42,663,012
Less: ordinary stock held in treasury, at cost; 0 share at October 31, 2023 and 2,000 shares at October 31, 2022			—				—
Accumulated deficit			(8,303,691	)			(5,800,817	)
Statutory reserve			275,150				226,253
Accumulated other comprehensive loss			(3,681,845	)			(3,620,712	)
Total TIAN RUIXIANG Holdings Ltd shareholders' equity			32,416,512				33,481,622
Non-controlling interest			394				400
Total Equity			32,416,906				33,482,022
Total Liabilities and Equity		$	35,479,774			$	35,030,828

TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS(IN U.S. DOLLARS)
		For the Years Ended October 31,
		2023				2022				2021
REVENUES
Commissions		$	1,244,247			$	1,324,655			$	2,675,611
Risk management services			—				27,254				115,006
Total Revenues			1,244,247				1,351,909				2,790,617
OPERATING EXPENSES
Selling and marketing			2,438,248				1,764,909				2,517,497
General and administrative - professional fees			1,220,367				1,185,930				1,011,053
General and administrative - compensation and related benefits			460,791				2,691,751				948,900
General and administrative - other			141,167				654,587				566,971
Impairment loss			—				123,646				—
Total Operating Expenses			4,260,573				6,420,823				5,044,421
LOSS FROM OPERATIONS			(3,016,326	)			(5,068,914	)			(2,253,804	)
OTHER INCOME (EXPENSE)
Interest income			731,961				434,406				315,070
Other (expense) income			(8,278	)			(26,042	)			18,686
Total Other Income, net			723,683				408,364				333,756
LOSS BEFORE INCOME TAXES			(2,292,643	)			(4,660,550	)			(1,920,048	)
INCOME TAXES			161,339				23,639				24,529
NET LOSS		$	(2,453,982	)		$	(4,684,189	)		$	(1,944,577	)
LESS: NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST			(5	)			(32	)			(28	)
NET LOSS ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD ORDINARY SHAREHOLDERS		$	(2,453,977	)		$	(4,684,157	)		$	(1,944,549	)
NET LOSS PER ORDINARY SHARE ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD ORDINARY SHAREHOLDERS:
Basic and diluted		$	(3.87	)		$	(9.03	)		$	(5.65	)
WEIGHTED AVERAGE ORDINARY SHARES OUTSTANDING:
Basic and diluted			633,336				518,655				344,425
COMPREHENSIVE LOSS:
NET LOSS		$	(2,453,982	)		$	(4,684,189	)		$	(1,944,577	)
OTHER COMPREHENSIVE (LOSS) INCOME
Unrealized foreign currency translation (loss) gain			(61,134	)			(3,717,478	)			214,123
COMPREHENSIVE LOSS			(2,515,116	)			(8,401,667	)			(1,730,454	)
LESS: COMPREHENSIVE LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST			(6	)			(89	)			(6	)
COMPREHENSIVE LOSS ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD ORDINARY SHAREHOLDERS		$	(2,515,110	)		$	(8,401,578	)		$	(1,730,448	)

TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH FLOWS(IN U.S. DOLLARS)
		For the Years Ended October 31,
		2023				2022				2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss		$	(2,453,982	)		$	(4,684,189	)		$	(1,944,577	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation expense and amortization of intangible assets			1,631				22,853				27,447
Amortization of right-of-use assets			78,126				185,421				227,661
Impairment loss			—				123,646				696
Stock-based compensation and service expense			1,450,000				2,888,787				—
Bad debt provision			7,338				—				—
Loss on disposal of property and equipment			848				—				—
Changes in operating assets and liabilities:
Accounts receivable			25,983				254,109				969,374
Security deposit			6,726				37,853				(43,750	)
Interest receivable			262,192				(149,178	)			(113,014	)
Due from related party			1,417				(1,511	)			—
Other assets			91,348				495,668				(74,120	)
Taxes payable			163,500				36,553				(78,932	)
Salary payable			347,567				349,436				—
Accrued liabilities and other payables			99,649				304,576				(123,052	)
Due to related parties			992,277				126,228				12,025
Operating lease liabilities - related party			—				—				(29,355	)
Operating lease liabilities			(80,316	)			(189,012	)			(194,341	)
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES			994,304				(198,760	)			(1,363,938	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment			—				(2,346	)			(3,411	)
Investment in note receivable			(7,800,000	)			—				(7,500,000	)
Proceeds from note receivable			7,500,000				—				—
Purchase of short-term investments			(27,779,231	)			(29,011,783	)			-
Proceeds from sale of short-term investments			27,086,514				116,663				-
NET CASH USED IN INVESTING ACTIVITIES			(992,717	)			(28,897,466	)			(7,503,411	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from note payable			—				—				75,581
Repayment of note payable			—				—				(75,581	)
Proceeds from related parties' borrowings			9,535				225,171				1,893,932
Repayments of related parties' borrowings			(9,818	)			(225,171	)			(2,272,145	)
Proceeds from initial public offering			—				—				12,300,000
Disbursements for initial public offering costs			—				—				(1,489,388	)
Proceeds from the June 2021 public offering			—				—				24,562,500
Disbursements for the June 2021 public offering costs			—				—				(2,352,418	)
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES			(283	)			—				32,642,481
EFFECT OF EXCHANGE RATE ON CASH AND RESTRICTED CASH			(1,471	)			(1,052,173	)			145,014
NET (DECREASE) INCREASE IN CASH AND RESTRICTED CASH			(167	)			(30,148,399	)			23,920,146
CASH AND RESTRICTED CASH - beginning of year			695,242				30,843,641				6,923,495
CASH AND RESTRICTED CASH - end of year		$	695,075			$	695,242			$	30,843,641
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for:
Interest		$	—			$	22			$	725
Income taxes		$	807			$	—			$	2,251
NON-CASH INVESTING AND FINANCING ACTIVITIES
Reissuance of treasury stock		$	25,000			$	—			$	—
Payments made by related parties on the Company’s behalf		$	1,068,700			$	—			$	119,886
RECONCILIATION OF CASH AND RESTRICTED CASH
Cash at beginning of year		$	2,508			$	30,024,372			$	6,137,689
Restricted cash at beginning of year			692,734				819,269				785,806
Total cash and restricted cash at beginning of year		$	695,242			$	30,843,641			$	6,923,495
Cash at end of year		$	2,383			$	2,508			$	30,024,372
Restricted cash at end of year			692,692				692,734				819,269
Total cash and restricted cash at end of year		$	695,075			$	695,242			$	30,843,641