Latest news with #JSDA
Japan Times
3 days ago
- Business
- Japan Times
JSDA said to probe brokerages on unsuitable Japanese bond sales
A Japanese securities industry group is probing brokerages on inappropriate bond selling practices amid surging investor demand for higher-yielding corporate debt. The Japan Securities Dealers Association (JSDA), which helps oversee the sector, sent questionnaires to nine major local and foreign brokerages asking about bond selling irregularities, such as overstating to issuers how much demand there is for their debt, according to people familiar with the matter. The probe marks a step toward ridding Japan's primary bond market of opaque sales practices as rising interest rates in the nation boost investor appetite for debt with higher yields and companies rush to sell notes before borrowing costs climb further. Foreign participation in Japan's corporate and municipal bond markets is also growing, putting pressure on domestic brokerages to conduct sales in a way that follows global norms. "It's crucial for the market to function effectively as a price discovery mechanism,' said Yuuki Fukumoto, senior financial researcher at NLI Research Institute. "If it doesn't, investors will eventually pull out, and the market will face serious consequences.' Fukumoto also said that "issuers are struggling to keep up with rising interest rates,' and lead underwriters are caught "in a dilemma' between being pressured to keep issuance costs low and facing investors demanding higher yields. Steps to increase market transparency have been tried in the past. In a market where overstating demand is considered an open secret, the JSDA in 2021 required lead managers who are appointed by issuers to disclose investor demand data for corporate and municipal bonds. But some bonds aren't covered by the rule, including certain retail bonds and regional debt that are underwritten without a lead manager. The JSDA held a working group meeting in late March to discuss false reporting in such deals and began preparing a broader investigation, according to a document. The questionnaire asked securities firms whether they contacted investors about future bond offerings before official filings were submitted, or witnessed such activity, said the people, who asked not to be identified because they were discussing private matters. Responses were due by the end of May. A JSDA representative declined to comment. The association is especially interested in the scope of inappropriate practices in corporate note sales targeting individual investors, who tend to be less financially literate than institutions, the people said. Those kinds of questionable transactions were tolerated in past decades, when Japan's credit market was quiet, dominated by domestic professional investors with limited trading volume. But now with retail investors and overseas traders becoming more active in the market, increased disclosure looks necessary.
Yahoo
02-04-2025
- Business
- Yahoo
Jones Soda Co (JSDA) Q4 2024 Earnings Call Highlights: Revenue Growth Amidst Rising Expenses
Net Revenue: Increased 15% to $19.1 million in 2024 from $16.7 million in 2023. Beverage Segment Revenue: $17.8 million in 2024, a 15.6% growth from $15.4 million in 2023. Hemp-Derived HD9 Products Revenue: Generated $1.7 million in 2024, compared to nil in 2023. Cannabis THC Segment Revenue: $1.3 million in 2024, up from $1.2 million in 2023. Gross Profit Margin: 21.3% in 2024, down from 29.1% in 2023, due to a $1.2 million inventory impairment charge. Total Operating Expenses: Increased to $14 million in 2024 from $9.7 million in 2023. Selling and Marketing Expenses: $6.8 million in 2024, up from $3.7 million in 2023. General and Administrative Expenses: Increased to $5.9 million in 2024 from $5.3 million in 2023. Net Loss: Increased to $9.9 million or $0.09 per share in 2024, from $4.9 million or $0.05 per share in 2023. Adjusted EBITDA: Negative $8.7 million in 2024, compared to negative $4.6 million in 2023. Cash Position: $1.5 million at the end of 2024. Revolving Credit Facility: Entered into a new $5 million facility post-2024. Warning! GuruFocus has detected 5 Warning Signs with JSDA. Release Date: April 01, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Jones Soda Co (JSDA) reported a 15% increase in net revenue for 2024, reaching $19.1 million compared to $16.7 million in the prior year. The company saw strong growth in its hemp-derived HD9 products, generating $1.7 million in net revenues during 2024. Jones Soda Co (JSDA) expanded its distribution network to 81 partners, enhancing its presence in key national and regional retailers across 37 states. The company launched innovative products like zero colas and limited edition collaborations, such as the exclusive agreement with Crayola. Jones Soda Co (JSDA) is optimistic about the future of the functional soda segment, with new products like Popp Jones and Fiesta Jones gaining traction. Gross profit as a percentage of revenue decreased to 21.3% from 29.1% in the prior period, primarily due to a $1.2 million one-time inventory impairment charge. Total operating expenses increased significantly to $14 million in 2024 from $9.7 million in 2023, driven by higher selling and marketing expenses. The company reported a net loss of $9.9 million for 2024, up from a net loss of $4.9 million in 2023. Jones Soda Co (JSDA) faced operational challenges and poor financial discipline in the latter half of the year, impacting growth. The company experienced a decrease in adjusted EBITDA, which was negative $8.7 million compared to negative $4.6 million in the previous year. Q: With broader concerns about a slowdown in the economy, do you think you'll be able to accomplish your growth objectives if consumer spending continues to slow down or things get worse? A: Scott Harvey, CEO: We understand the concerns around the broader economy, but we have not seen a material slowdown in our operating categories. We are confident in our growth opportunities and are actively working to improve our cost bases and supply chain to enhance our margin profile and manage our P&L effectively. Q: How does Jones intend to navigate the shifting landscape of the HD9 playing field with many state attorney generals and congressional bodies taking steps to address this growing category? A: Scott Harvey, CEO: We are closely monitoring the evolving regulatory landscape of the HD9 category. We are committed to ensuring compliance with all regulations and are proactively engaging with regulatory bodies to understand potential impacts on our business, allowing us to adapt our strategy as needed. Q: What is the status of the Mary Jones launch in Michigan that was announced months ago? Are there any plans to expand into new states? A: Scott Harvey, CEO: Mary Jones launched in Michigan during Q4 2024, and our sodas launched on March 12, 2025. The launch broke our distributor's record for all KPIs except average order value. We are evaluating several other states and plan to launch in additional high-value states in 2025. Q: Where do you see the company in 5 years, and why should investors believe in this management team over the previous ones? A: Scott Harvey, CEO: In 5 years, we envision Jones evolving into a full-fledged beverage company, expanding beyond core offerings to capture new markets. Our management team is committed to financial discipline and operational excellence, ensuring smarter investments, improved margins, and long-term profitability. Q: Are you comfortable with your current liquidity position? A: Brian Meadows, CFO: We secured a new $5 million credit facility in February 2025 to support our growth initiatives. This facility allows us to borrow off a larger base of assets, providing flexibility to capitalize on growth opportunities. We will seek the best capital sources if further expansion is needed. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
