Chenghe Acquisition II Co. Reports Q1 2025 Financial Results with Net Income of $226,423

Chenghe Acquisition II Co. reported its financial results for the first quarter of 2025, revealing a net income of $226,423, a significant improvement compared to a net loss of $96,056 for the same period in the previous year. The company generated this income primarily from interest earned on cash and marketable securities held in its Trust Account, amounting to $928,162. Operating costs for the quarter were reported at $701,739, reflecting the company's ongoing expenses related to its formation and public company obligations.

The company's balance sheet as of March 31, 2025, showed total current assets of $141,287, a decrease from $321,714 at the end of 2024. This decline was largely due to a reduction in cash, which fell to $110,699 from $251,105. The Trust Account, which holds proceeds from the company's Initial Public Offering (IPO), contained $89,563,833, slightly up from $88,635,671 at the end of the previous year. Current liabilities increased to $6,903,094, up from $6,381,782, primarily due to higher accounts payable and accrued expenses.

Chenghe Acquisition II Co. has not yet commenced operations but is actively pursuing a business combination. The company entered into a Business Combination Agreement with Polibeli Group Ltd on September 16, 2024, which is expected to be finalized within the stipulated 24-month period following the IPO. The company has until June 12, 2026, to complete this initial business combination, or it will face mandatory liquidation. As of the end of the first quarter, the company had a working capital deficit of $3,311,807, raising concerns about its liquidity and ability to execute its business strategy.

In terms of operational metrics, the company has 8,625,000 Class A ordinary shares subject to possible redemption, reflecting the units sold during its IPO. The weighted average shares outstanding for Class A ordinary shares was 8,625,000, with a basic and diluted net income per share of $0.02. The company has also maintained a stable employee headcount, with no significant changes reported in staffing levels.

Looking ahead, Chenghe Acquisition II Co. aims to utilize the funds held in the Trust Account to complete its business combination and pursue growth strategies. However, management has expressed concerns regarding the potential inability to complete the business combination within the required timeframe, which could lead to liquidation. The company continues to monitor market conditions and is prepared to adapt its strategies as necessary to achieve its objectives.