YHGJ Narrows Losses, Boosts Sales Amid Reverse Stock Split

TL;DR

**YHGJ is showing signs of operational improvement with narrower losses and higher sales, but the reverse stock split is a band-aid on a still-bleeding balance sheet, so stay cautious.**

AI Summary

YUNHONG GREEN CTI LTD. (YHGJ) reported a net loss of $811,000 for the three months ended September 30, 2025, a significant improvement from the $1,193,000 net loss in the same period of 2024. For the nine months ended September 30, 2025, the net loss was $1,412,000, down from $2,182,000 in the prior year. Net sales increased to $2,953,000 for the three-month period in 2025, up from $2,540,000 in 2024, and rose to $13,212,000 for the nine-month period in 2025 from $11,788,000 in 2024. Gross profit also improved, reaching $67,000 for the quarter (from a $20,000 loss) and $1,911,000 for the nine months (from $1,568,000). The company's cash and cash equivalents increased to $387,000 at September 30, 2025, from $220,000 at December 31, 2024, driven by $2,300,000 in net cash provided by operating activities. However, total assets decreased to $22,171,000 from $25,578,000, and total liabilities decreased to $11,630,000 from $14,875,000. The company executed a 1-for-10 reverse stock split effective October 1, 2025, and continues to face a cumulative net loss of approximately $27 million since inception.

Why It Matters

YHGJ's ability to significantly reduce its net loss and increase sales, particularly in a competitive manufacturing and packaging market, suggests potential operational improvements. The 1-for-10 reverse stock split, effective October 1, 2025, aims to boost share price and potentially meet Nasdaq listing requirements, which is crucial for investor confidence and market liquidity. However, the persistent cumulative net loss of $27 million and the ongoing need for additional financing highlight a challenging path to sustained profitability. Investors should weigh the improved operational metrics against the long-term financial stability and the company's ability to secure future funding in a market where competitors like CTI Industries (if related) or other packaging firms are vying for market share.

Risk Assessment

Risk Level: high — The company has a cumulative net loss of approximately $27 million from inception to September 30, 2025, indicating a history of unprofitability. Furthermore, the filing explicitly states, 'The Company's cash resources from operations may be insufficient to meet its anticipated needs during the next twelve months,' and that it 'may require additional financing to fund its future planned operations,' which are clear going concern risks.

Analyst Insight

Investors should closely monitor YHGJ's ability to secure additional financing and execute its operating plan, as stated in the 'Liquidity and Going Concern' section. While the reduced net loss and increased sales are positive, the significant cumulative deficit and potential cash insufficiency warrant a cautious approach, suggesting a 'wait and see' strategy before making new investments.

Financial Highlights

debt To Equity

0.99

revenue

$13,212,000

operating Margin

N/A

total Assets

$22,171,000

total Debt

$11,517,000

net Income

-$1,412,000

eps

-$0.58

gross Margin

14.46%

cash Position

$387,000

revenue Growth

+12.07%

Key Numbers

• $1,412,000 — Net Loss (for the nine months ended September 30, 2025, a decrease from $2,182,000 in 2024)
• $13,212,000 — Net Sales (for the nine months ended September 30, 2025, an increase from $11,788,000 in 2024)
• $27,000,000 — Cumulative Net Loss (from inception to September 30, 2025, indicating ongoing unprofitability)
• $387,000 — Cash and Cash Equivalents (at September 30, 2025, up from $220,000 at December 31, 2024)
• $2,300,000 — Net Cash Provided by Operating Activities (for the nine months ended September 30, 2025, a significant increase from $862,000 in 2024)
• 1-for-10 — Reverse Stock Split (effective October 1, 2025, impacting common stock shares and per share data)
• $0.58 — Basic Loss Per Common Share (for the nine months ended September 30, 2025, an improvement from $1.01 in 2024)
• $22,171,000 — Total Assets (at September 30, 2025, a decrease from $25,578,000 at December 31, 2024)
• $11,630,000 — Total Liabilities (at September 30, 2025, a decrease from $14,875,000 at December 31, 2024)
• $67,000 — Gross Profit (for the three months ended September 30, 2025, an improvement from a $20,000 loss in 2024)

Key Players & Entities

• YUNHONG GREEN CTI LTD. (company) — registrant
• Yunhong Technology Industry (Hubei) Co., Ltd. (company) — wholly owned subsidiary
• CTI Supply, Inc. (company) — inactive subsidiary
• Nasdaq Stock Market LLC (regulator) — exchange where common stock is registered
• $2,953,000 (dollar_amount) — net sales for three months ended September 30, 2025
• $2,540,000 (dollar_amount) — net sales for three months ended September 30, 2024
• $13,212,000 (dollar_amount) — net sales for nine months ended September 30, 2025
• $11,788,000 (dollar_amount) — net sales for nine months ended September 30, 2024
• $811,000 (dollar_amount) — net loss for three months ended September 30, 2025
• $1,193,000 (dollar_amount) — net loss for three months ended September 30, 2024

FAQ

Risk Factors

• Cumulative Net Loss and Going Concern [high — financial]: The company has a cumulative net loss of approximately $27 million since inception as of September 30, 2025. While net loss has decreased and operating cash flow has improved, the substantial historical losses raise concerns about the company's ability to continue as a going concern without further financing or improved profitability.
• Reverse Stock Split Impact [medium — financial]: A 1-for-10 reverse stock split was effective October 1, 2025. This action is often taken by companies facing delisting or to improve the marketability of their stock, but it does not address the underlying operational issues and can negatively impact investor perception if not accompanied by fundamental improvements.
• Dependence on Key Personnel [medium — operational]: The company's success may depend on the continued service of its key management personnel. The loss of any key executive could have a material adverse effect on operations and financial performance.
• Market Acceptance and Competition [medium — market]: The company operates in a competitive market. Failure to achieve market acceptance for its products or services, or to effectively compete with existing and new competitors, could adversely impact revenue and profitability.

Industry Context

YUNHONG GREEN CTI LTD. operates within a sector that likely faces pressures from evolving consumer preferences, supply chain dynamics, and potentially environmental regulations. The company's reported improvements in sales and gross profit suggest some positive traction, but the overall market context for companies with significant cumulative losses remains challenging.

Regulatory Implications

The company's financial performance, particularly its history of cumulative losses and the recent reverse stock split, may attract scrutiny from regulatory bodies like the SEC, especially concerning its continued listing on exchanges. Compliance with financial reporting standards and disclosure requirements is paramount.

What Investors Should Do

1. Monitor Operating Cash Flow Trends
2. Analyze Gross Margin Improvement
3. Evaluate Impact of Reverse Stock Split
4. Assess Debt Reduction and Asset Management

Key Dates

• 2025-09-30: End of Third Quarter 2025 — Reporting period for the 10-Q, showing reduced net loss and increased sales compared to the prior year.
• 2025-10-01: Reverse Stock Split Effective — A 1-for-10 reverse stock split was enacted, impacting share count and per-share metrics moving forward.
• 2024-09-30: End of Third Quarter 2024 — Prior year comparative period, showing a larger net loss ($1,193,000 for the quarter, $2,182,000 for nine months) and lower sales ($2,540,000 for the quarter, $11,788,000 for nine months).
• 2024-12-31: End of Fiscal Year 2024 — Previous year-end balance sheet comparison point, showing lower cash ($220,000) and higher total liabilities ($14,875,000) and assets ($25,578,000).

Glossary

Reverse Stock Split

A corporate action where a company reduces the number of its outstanding shares by consolidating them. For example, a 1-for-10 split means every 10 old shares become 1 new share. (YHGJ executed a 1-for-10 reverse stock split effective October 1, 2025, which reduces the number of shares outstanding and increases the per-share price, impacting EPS calculations.)

Net Cash Provided by Operating Activities

The amount of cash generated or used by a company's normal business operations over a period. A positive number indicates cash is being generated. (YHGJ reported $2,300,000 for the nine months ended September 30, 2025, a significant increase from $862,000 in 2024, which helped boost cash reserves.)

Cumulative Net Loss

The total net loss a company has incurred from its inception to a specific point in time. It represents the accumulated deficit. (YHGJ has a cumulative net loss of approximately $27 million as of September 30, 2025, highlighting a long-term struggle with profitability.)

Gross Profit

Revenue minus the cost of goods sold (COGS). It represents the profit a company makes after deducting the direct costs associated with producing its goods or services. (YHGJ improved its gross profit to $67,000 for the three months ended September 30, 2025, from a $20,000 loss in the prior year, indicating better cost management or pricing.)

Year-Over-Year Comparison

Compared to the prior year's comparable periods, YUNHONG GREEN CTI LTD. has demonstrated positive momentum. Net sales for the nine months ended September 30, 2025, increased by 12.07% to $13,212,000 from $11,788,000, and the net loss narrowed significantly to $1,412,000 from $2,182,000. Gross profit also saw a substantial improvement, turning a loss into a profit. Furthermore, cash and cash equivalents have increased, supported by a robust rise in operating cash flow, despite a decrease in total assets and liabilities.

Key Financial Figures

• $000 — ounded to the nearest thousand dollars ($000), which is in accordance with our polic

Filing Documents

• form10-q.htm (10-Q) — 822KB
• ex31-1.htm (EX-31.1) — 14KB
• ex31-2.htm (EX-31.2) — 14KB
• ex32.htm (EX-32) — 9KB
• 0001493152-25-022194.txt ( ) — 3876KB
• yhgj-20250930.xsd (EX-101.SCH) — 32KB
• yhgj-20250930_cal.xml (EX-101.CAL) — 49KB
• yhgj-20250930_def.xml (EX-101.DEF) — 142KB
• yhgj-20250930_lab.xml (EX-101.LAB) — 280KB
• yhgj-20250930_pre.xml (EX-101.PRE) — 211KB
• form10-q_htm.xml (XML) — 438KB

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 12 Item No. 3

Quantitative and Qualitative Disclosures Regarding Market Risk

Quantitative and Qualitative Disclosures Regarding Market Risk 16 Item No. 4

Controls and Procedures

Controls and Procedures 16

– OTHER INFORMATION

PART II – OTHER INFORMATION Item No. 1

Legal Proceedings

Legal Proceedings 17 Item No. 1A

Risk Factors

Risk Factors 17 Item No. 2 Unregistered Sales of Equity Securities and Use of Proceeds 17 Item No. 3 Defaults Upon Senior Securities 17 Item No. 4 Mine Safety Disclosures 17 Item No. 5 Other Information 17 Item No. 6 Exhibits 18

Signatures

Signatures 19 Exhibit 31.1 Exhibit 31.2 Exhibit 32 Table of Contents Yunhong Green CTI, Ltd Unaudited Condensed Consolidated Balance Sheets September 30, December 31, 2025 2024 ASSETS Current assets: Cash and cash equivalents $ 387,000 $ 220,000 Accounts receivable, net 2,691,000 5,403,000 Inventories 8,680,000 8,493,000 Prepaid expenses 184,000 412,000 Total current assets 11,942,000 14,528,000 Property, plant and equipment: Machinery and equipment 22,347,000 22,246,000 Office furniture and equipment 2,122,000 2,084,000 Intellectual property 783,000 783,000 Leasehold improvements 39,000 39,000 Fixtures and equipment 518,000 518,000 Projects under construction 125,000 196,000 Property, plant and equipment gross 25,934,000 25,866,000 Less: accumulated depreciation and amortization ( 21,436,000 ) ( 20,958,000 ) Total property, plant and equipment, net 4,498,000 4,908,000 Other assets: Operating lease right-of-use 3,539,000 3,950,000 Prepaid expenses, noncurrent 2,192,000 2,192,000 Total other assets 5,731,000 6,142,000 TOTAL ASSETS $ 22,171,000 $ 25,578,000 LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Trade payables $ 1,749,000 $ 1,537,000 Line of credit 4,579,000 6,578,000 Notes payable – current portion 183,000 606,000 Notes payable – related party 344,000 344,000 Notes payable 344,000 344,000 Operating lease liabilities – current portion 564,000 480,000 Advance investor deposit 100,000 1,050,000 Accrued liabilities 722,000 810,000 Total current liabilities 8,241,000 11,405,000 Long-term liabilities: Note payable – noncurrent 357,000 - Operating lease liabilities – noncurrent 3,032,000 3,470,000 Total long-term liabilities 3,389,000 3,470,000 TOTAL LIABILITIES $ 11,630,000 $ 14,875,000 SHAREHOLDERS' EQUITY Series E Preferred Stock — no par value, 130,000 shares authorized, issued and outstanding

View Full Filing

View this 10-Q filing on SEC EDGAR