Chenghe Acquisition I Co. (formerly LatAmGrowth SPAC) reported its financial results for the three and nine months ended September 30, 2024, highlighting significant changes in revenue, profitability, and strategic developments compared to the previous fiscal period.

As of September 30, 2024, the company held $45.8 million in its Trust Account, an increase from $43.6 million at the end of 2023. Total assets also rose to $45.9 million from $43.6 million. However, total current liabilities surged to $4.5 million from $2.1 million, contributing to a total shareholders’ deficit of $(4.9 million), up from $(2.3 million) at the end of 2023.

For the three months ended September 30, 2024, Chenghe reported a net income of $224,112, a decline from $1.0 million in the same period of 2023. The nine-month results showed a net loss of $(408,688), a stark contrast to a net income of $3.96 million for the same period last year. The decrease in profitability was attributed to higher formation and operating costs, which increased to $1.57 million for the nine months ended September 30, 2024, compared to $1.02 million in 2023. Trust interest income also fell significantly, from $3.07 million in 2023 to $1.45 million in 2024.

The company experienced a notable shift in cash flows, with net cash used in operating activities rising to $(1.09 million) for the nine months ended September 30, 2024, compared to $(438,469) in the prior year. Cash used in investing activities was $(788,375) in 2024, while the previous year saw a net cash inflow of $77.02 million due to a significant redemption from the Trust Account.

Strategically, Chenghe has undergone management changes, with new appointments following the resignation of former CEO Gerard Cremoux and CFO Gerardo Mendoza in October 2023. The company also extended its deadline to complete a business combination from April 27, 2023, to November 27, 2023, and subsequently entered into a Business Combination Agreement with Femco Steel Technology Co., Ltd. (FST) on December 22, 2023. The agreement stipulates that FST will cover certain fees related to the extension of the company’s Termination Date.

The company’s financial health remains uncertain, with management expressing substantial doubt about its ability to continue as a going concern if a business combination is not consummated by the required date. As of September 30, 2024, the company had no cash on hand and a working capital deficit of $4.47 million, indicating a challenging financial position as it seeks to finalize its initial business combination.