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Educational Development Corporation (EDUC+1.72%) has submitted its 10-Q filing for the quarterly period ended November 30, 2024.
The filing includes financial statements for the quarter, showing a decrease in net revenues to $11,052,100 from $16,944,800 in the same quarter the previous year. The decline in revenues is attributed to a decrease in the average number of active brand partners and increased discounts.
Cost of goods sold for the quarter was $4,148,300, leading to a gross margin of $6,903,800, compared to $11,142,400 in the previous year. The gross margin percentage decreased due to higher discounts offered during the period.
Operating expenses for the quarter were $8,102,400, down from $12,083,500 in the previous year. This decrease was primarily due to reductions in labor and freight expenses.
The company reported an operating loss of $1,111,900 for the quarter, compared to an operating income of $2,696,000 in the previous year.
Interest expense decreased to $575,400 from $726,200, reflecting reduced borrowings.
Other income was $662,100, down from $4,363,300, primarily due to the absence of gains from asset sales recorded in the prior year.
Net loss for the quarter was $835,700, compared to a net income of $1,972,100 in the previous year. The effective tax rate for the quarter was 24.8%, compared to 26.8% in the previous year.
Cash provided by operating activities was $4,778,300, while cash used in investing and financing activities was $298,500 and $2,532,300, respectively.
The company reported a working capital of $41,806,700 as of November 30, 2024. The filing notes concerns about the company's ability to continue as a going concern due to the short-term duration of the revolving loan and recurring operating losses.
The filing also details various amendments to the credit agreement with BOKF, NA, including changes to the revolving loan commitment and maturity dates.
Educational Development Corporation continues to focus on reducing inventory levels and increasing the number of active brand partners to improve financial performance.
This content was summarized by generative artificial intelligence using public filings retrieved from SEC.gov. The original data was derived from the Educational Development Corporation quarterly 10-Q report dated January 13, 2025. To report an error, please email earnings@qz.com.