BEIJING, Sept. 27, 2019 /PRNewswire/ -- Recon
Technology, Ltd. (Nasdaq: RCON) ("Recon" or the "Company"),
a China-based independent solutions integrator in the oilfield
service and environmental protection, electric power and coal
chemical industries, today announced its financial results for the
fiscal year ended June 30, 2019.
Management Commentary
Mr. Shenping Yin, co-founder and CEO of Recon stated, "We
are delighted to announce another year with strong growth in our
business with revenue reaching a historical high since our IPO,
losses narrowed and a positive EBITDA result. With consistent
implementation of our market strategy by leveraging our knowledge
of China's energy industry and
diversifying our revenue sources, our financial results for fiscal
year 2019 increased to RMB 102.4
million in revenue from RMB 84.7
million over the same period last year. During fiscal year
2019, we have successfully accomplished our three-year performance
goals set by our management in fiscal year 2016 and achieved a
revenue Compound annual growth rate (CAGR) of 31%. We will continue
to strive for a better performance in the coming years. During
fiscal year 2019, we successfully expanded our automation business
to the power industry and coal chemical industry by serving China
Energy Investment Corporation ("China Energy") through Shenhua
Group Corporation Limited ("Shenhua Group"). Today, we have won
bids of RMB40.84 million in the
aggregate from the Shenhua Group. During this period, we also have
completed most of the construction of our comprehensive disposal
treatment project and have entered into the test-running stage. We
have signed several contracts with Yumen oilfield and its
affiliates to dispose over 2,500 tons of oily sludge, and the
revenue to be generated from those projects has not been reflected
in the results of operations of fiscal year 2019. We expect our own
operations and performance will continue to be improved to bring
our shareholders long-term benefits."
Mr. Yin continued, "During fiscal year 2019, we also made
an additional investment into Future Gas Station (Beijing) Technology, Ltd ("FGS"), a service
company focused on providing new technical applications and data
operations to gas stations and providing solutions to gas stations
to improve their operations and their customers' experience.
Currently, we hold a 43% interest of FGS. With the support of our
investment and operations, online orders in the FGS platform have
been increasing and have reached an average level of RMB 7 million per day and accumulated gross
merchandise volume (GMV) of the FGS platform has been over
RMB1.5 Billion with only 460 gas
stations officially operating. We also saw a net profit of FGS from
July 2019. We look forward to a more
rapid development of FGS in the coming months. In all, our
management is striving to seek for more valuable and profitable
assets to our shareholders."
Fiscal Year 2019 Financial Highlights (all comparable to the
prior year period):
|
|
For the Fiscal
Year Ended June 30,
|
(RMB millions,
except per share data)
|
|
2018
|
|
2019
|
|
%
Change
|
Revenue
|
|
84.7
|
|
102.4
|
|
20.9%
|
Automation
product and software
|
|
19.0
|
|
63.6
|
|
234.8%
|
Equipment and
accessories
|
|
64.0
|
|
24.0
|
|
-62.6%
|
Oilfield
environmental protection
|
|
1.8
|
|
14.9
|
|
743.3%
|
Gross
profit
|
|
4.2
|
|
29.9
|
|
619.6%
|
Gross
margin
|
|
4.9%
|
|
29.2%
|
|
24.3pp
|
Loss from
operations
|
|
-40.9
|
|
-24.2
|
|
40.8%
|
Net loss
attributable to Recon Technology, Ltd
|
|
-44.1
|
|
-25.4
|
|
42.5%
|
Loss per
share
|
|
-3.84
|
|
-1.30
|
|
-66.2%
|
Adjusted EBITDA
(Non-GAAP)
|
|
-21.6
|
|
1.04
|
|
100.4%
|
|
* Note: pp represents
percentage points
|
- Total revenues for fiscal year 2019 increased by 20.9% to
RMB102.4 million ($14.9 million).
- The revenue of automation business was a record RMB63.6 million ($9.3
million) for fiscal year 2019, increasing by 234.8% compared
to RMB19.0 million during fiscal year
2018.
- Gross profit for fiscal year 2019 was RMB29.9 million ($4.3
million). Gross profit margin for fiscal year 2019 was
29.2%, an improvement of 24.3 percentage points compared to fiscal
year 2018.
- Net loss attributable to Recon for fiscal year 2019 was
RMB25.4 million ($3.7 million), or RMB1.30 ($0.19) per
basic and diluted share, compared to RMB42.3
million, or RMB3.84 per basic
and diluted share, for fiscal year 2018.
Fiscal Year 2019 Financial Results
Revenue
Total revenues for the fiscal year ended June 30, 2019 increased by RMB17.7 million, or 20.9%, to RMB102.4 million ($14.9
million) compared to RMB84.7
million for the fiscal year ended June 30, 2018. The increase in revenues was
accomplished through the automation products and software and
oilfield environmental protection segments.
Revenue from automation product and software increased by
RMB44.6 million, or 234.8%, to
RMB 63.6 million ($9.3 million) for the fiscal year ended
June 30, 2019 from RMB18.9 million for the fiscal year ended
June 30, 2018, mainly from orders
from Shenhua Group and automation control system projects for
Xinjiang East Hope New Energy Co., Ltd. ("East Hope"), a
polysilicon producer in China and
a wholly-owned subsidiary of East Hope Group, a large Chinese
conglomerate.
Revenue from equipment and accessories decreased by RMB40.0 million, or 62.6%, to RMB24.0 million ($3.5
million) for the fiscal year ended June 30, 2019 from RMB64.0
million for the fiscal year ended June 30, 2018. For the year ended June 30, 2018, we accepted some low-margin
contracts, resulting in higher revenue. We didn't continue this
type of temporary business in the same period of fiscal year 2019
and the revenue from furnaces decreased dramatically.
Revenue from oilfield environmental protection projects
increased by RMB13.1 million, or
743.3%, to RMB14.9 million
($2.2 million) for the fiscal year
ended June 30, 2019 from RMB1.8 million for the fiscal year ended
June 30, 2018. The increase was
mainly derived from our focus on oily wastewater treatment
technology. As our oily sludge treatment processing projects begin
to production later on year 2019, we believe revenue from this
segment will increase.
Cost and Margin
Total cost of revenues decreased by RMB8.0 million, or 10.0%, to RMB72.5 million ($10.6
million) for the fiscal year ended June 30, 2019. The decrease was mainly caused by
a significant decrease in cost of revenue incurred in low-margin
equipment and accessories contracts.
Cost of revenue from automation product and software increased
by RMB32.3 million ($4.7 million), or 190.8%, to RMB49.3 million ($7.2
million) for the fiscal year ended June 30, 2019 from RMB16.9 million for the fiscal year ended
June 30, 2018. The increase in cost
of revenue from automation product and software was primarily
attributable to Shenhua Group contracts with lower margins.
Cost of revenue from equipment and accessories decreased by
RMB47.1 million ($6.9 million), or 75.9%, to RMB14.9 million ($2.2
million) for the fiscal year ended June 30, 2019 from RMB62.0 million for the fiscal year ended
June 30, 2018. The decrease in cost
of revenue from equipment and accessories was primarily
attributable to our drop of furnaces to general industry
clients.
Cost of revenue from oilfield environmental protection increased
by RMB6.5 million ($1.0 million), or 492.5%, to RMB7.9 million ($1.1
million) for the fiscal year ended June 30, 2019 from RMB1.3 million for the fiscal year ended
June 30, 2018. The increase in cost
of revenue was mainly due to more orders of chemical materials used
for waste water treatment.
Gross profit increased significantly by RMB25.7 million, or 619.6%, to RMB29.9 million ($4.3
million) for the fiscal year ended June 30, 2019 from RMB4.2 million from the fiscal year ended
June 30, 2018. The improvement in
gross profit was primarily due to the increase in revenue and, to a
lesser extent, the increase in profit margins. As our business
improved with industry recovery and enhancement of our cost
control, our margins improved to normal levels. Gross margin
increased by 24.3 percentage points to 29.2% for the fiscal year
ended June 30, 2019 from 4.9% from
the fiscal year ended June 30,
2018.
Operating Expenses
Selling and distribution expenses increased by RMB1.1 million, or 13.3%, to RMB9.1 million ($1.3
million) for the fiscal year ended June 30, 2019 from RMB8.0 million for the fiscal year ended
June 30, 2018. This increase was
primarily due to an increase in salaries and related expenditures
as we expanded our market to new segments of China's energy markets, including the
electronic power and new energy segments, and beyond the oilfield
service industry into oily sludge and sewage treatments.
General and administrative expenses increased by RMB6.6 million, or 19.0%, to RMB41.3 million ($6.0
million) for the fiscal year ended June 30, 2019 from RMB34.7 million for the fiscal year ended
June 30, 2018. The increase in
general and administrative expenses was mainly due to an increase
in stock-based compensation expense.
Provision for doubtful accounts was RMB0.6 million ($0.1
million) for the fiscal year ended June 30, 2019, compared to reversal of provision
for doubtful accounts of RMB0.8
million for the fiscal year ended June 30, 2018. Management plans to continue to
monitor accounts receivable to maintain the provision at a lower
level.
Research and development expenses maintained the same level of
RMB3.1 million ($0.5 million) for the fiscal year ended
June 30, 2019 compared to the same
period of last year. The Company was focusing on the
commercialization of advanced R&D results into projects, which
were undertaken by Gan Su BHD.
Net Loss
Loss from operations was RMB24.2
million ($3.5 million) for the
year ended June 30, 2019, compared to
a loss of RMB40.9 million for the
same period of 2018. This RMB16.7
million ($2.4 million)
decrease in loss from operations was primary due to an increase in
gross profit, partial offset by an increase in general and
administrative expenses and selling and distribution expenses as
discussed above.
Net loss was RMB25.8 million
($3.8 million) for the year ended
June 30, 2019, a decrease of
RMB19.6 million ($2.9 million) from net loss of RMB45.4 million for the same period of 2018. Net
loss attributable to Recon for the fiscal year ended June 30, 2018 was RMB44.1 million ($6.7
million), or RMB3.84 per
basic and diluted share, compared to RMB25.4
million, or RMB1.30
($0.19) per basic and diluted share
for the fiscal year ended June 30,
2019.
EBITDA
Adjusted EBITDA income was RMB1.0
million for the year ended June 30,
2019, compared to an adjusted EBITDA loss of RMB 21.6 million for the same period last year.
Please see the section titled "Non-GAAP Financial Measures" below
for a discussion of this metric, which we believe may be
informative for investors but which is not a GAAP financial
measure.
Financial Condition
As of June 30, 2019, the Company
had cash of RMB4.5 million
($0.7 million), compare to
RMB45.3 million as of June 30, 2018. As of June
30, 2019, the Company had working capital of RMB55.7 million ($8.1
million) while as of June 30,
2018, the Company had working capital of RMB74.8 million. The decrease in working capital
was mainly due to use of cash on construction of new product
capabilities and the equity investment of FGS.
Net cash used in operating activities was RMB32.2 million ($4.7
million) for the fiscal year ended June 30, 2019, compared to net cash used in
operating activities of approximately RMB19.6 million for the fiscal year ended
June 30, 2018. Net cash used in
investing activities was RMB13.5
million ($2.0 million) for the
fiscal year ended June 30, 2019,
compared to RMB17.6 million for the
fiscal year ended June 30, 2018. Net
cash provided by financing activities was RMB3.5 million ($0.5
million) for the fiscal year ended June 30, 2019, compared to net cash provided by
financing activities of RMB76.9
million for the fiscal year ended June 30, 2018.
Exchange Rate
The translation of RMB amounts into U.S. dollars are included
solely for the convenience of readers and have been made at the
rate of RMB6.8668 to $1.00, the
approximate exchange rate prevailing on June
30, 2019.
Non-GAAP Financial Measures
In addition to the Company's U.S. GAAP results, this press
release includes a discussion of adjusted EBITDA and adjusted
earnings (loss) per share, which are non-GAAP financial measures.
The Company's management defines adjusted EBITDA as earnings before
interest expense, income taxes, depreciation, and amortization
expense, and non-recurring expenses. All of the omitted items are
either (i) non-cash items or (ii) items that the Company does
not consider in assessing the Company's ongoing operating
performance. Because adjusted EBITDA omits non-cash items, the
Company's management believes that adjusted EBITDA is less
susceptible to variances in actual performance resulting from
depreciation, amortization, and other non-cash charges and more
reflective of other factors that affect its operating performance.
The Company's management defines adjusted earnings per share by
eliminating from earnings (loss) per share the impact of a number
of non-recurring items the Company does not consider indicative of
its ongoing performance. Recon's management believes that the use
of these non-GAAP financial measures provides an additional tool
for investors to use in evaluating ongoing operating results and
trends and in comparing the Company's financial measures with other
competitors, many of which present similar non-GAAP financial
measures to investors.
|
For the year Ended
June 30,
|
|
2018
|
|
2019
|
|
RMB
|
|
RMB
|
Reconciliation of
adjusted EBITDA to net loss
|
|
|
|
Net
loss
|
(45,375,234)
|
|
(25,782,406)
|
Provision
(benefit) for income taxes
|
16,230
|
|
398,477
|
Interest
expense and foreign currency adjustment
|
901,589
|
|
1,532,442
|
Provision for
(reversal of) slow moving inventories
|
65,245
|
|
65,380
|
Restricted
shares issued for services
|
3,050,896
|
|
845,781
|
Provision for
(net recovery of) doubtful accounts
|
(841,242)
|
|
610,776
|
Loss from
investment in unconsolidated entity
|
-
|
|
959,905
|
Impairment of
investment loss in unconsolidated entity
|
4,037,736
|
|
-
|
Share based
compensation
|
840,286
|
|
9,647,863
|
Restricted
shares issued for management
|
14,621,838
|
|
11,640,341
|
Depreciation
and amortization
|
1,119,049
|
|
1,124,011
|
Adjusted
EBITDA
|
(21,563,607)
|
|
1,042,570
|
About Recon Technology, Ltd.
Recon Technology,
Ltd. (RCON) is China's first non-state-owned oil and gas field
service company listed on NASDAQ. Recon
supplies China's largest oil exploration companies,
Sinopec (SNP) and CNPC, with advanced automated technologies,
efficient gathering and transportation equipment and reservoir
stimulation measure for increasing petroleum extraction levels,
reducing impurities and lowering production costs. Since 2017, the
Company has expanded its business operations into other segments of
the broader energy industry including electric power, coal
chemical, renewable energy and environmental protection in the
energy and chemical industries, Through the years, Recon has taken
leading positions on several market segments of the oil and gas
field service industry. Recon also has developed stable long-term
cooperation relationship with its major clients, and its products
and service are well accepted by clients. For additional
information please visit: www.recon.cn.
Safe Harbor
This news release contains forward-looking statements as defined
by the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include statements concerning plans,
objectives, goals, strategies, future events or performance, and
underlying assumptions and other statements that are other than
statements of historical facts. These statements are subject to
uncertainties and risks including, but not limited to, product and
service demand and acceptance, changes in technology, economic
conditions, the impact of competition and pricing, government
regulation, and other risks contained in reports filed by the
company with the Securities and Exchange Commission. All such
forward-looking statements, whether written or oral, and whether
made by or on behalf of the company, are expressly qualified by the
cautionary statements and any other cautionary statements which may
accompany the forward-looking statements. In addition, the company
disclaims any obligation to update any forward-looking statements
to reflect events or circumstances after the date hereof.
For more information, please contact:
In China:
Ms. Liu Jia
Chief Financial Officer
Recon Technology, Ltd.
Phone: +86 (10) 8494-5799
Email: info@recon.cn
RECON TECHNOLOGY,
LTD
|
BALANCE
SHEETS
|
|
|
As of June
30
|
|
As of June
30
|
|
As of June
30
|
|
2018
|
|
2019
|
|
2019
|
|
RMB
|
|
RMB
|
|
U.S.
Dollars
|
ASSETS
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
|
|
Cash
|
Â¥
|
45,340,578
|
|
Â¥
|
4,521,325
|
|
$
|
658,433
|
Notes
receivable
|
|
3,995,962
|
|
|
3,073,680
|
|
|
447,615
|
Trade accounts
receivable, net
|
|
24,254,007
|
|
|
68,535,282
|
|
|
9,980,673
|
Trade accounts
receivable- related party, net
|
|
-
|
|
|
3,409,912
|
|
|
496,579
|
Inventories,
net
|
|
6,758,841
|
|
|
1,270,523
|
|
|
185,024
|
Other receivables,
net
|
|
5,360,953
|
|
|
5,665,593
|
|
|
825,070
|
Loans to third
parties
|
|
1,960,000
|
|
|
4,960,000
|
|
|
722,316
|
Purchase advances,
net
|
|
12,654,546
|
|
|
1,343,576
|
|
|
195,663
|
Contract assets,
net
|
|
-
|
|
|
4,633,940
|
|
|
674,833
|
Prepaid
expenses
|
|
509,682
|
|
|
192,837
|
|
|
28,083
|
Prepaid expenses -
related parties
|
|
-
|
|
|
217,600
|
|
|
31,689
|
Total current
assets
|
|
100,834,569
|
|
|
97,824,268
|
|
|
14,245,978
|
|
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
3,171,109
|
|
|
3,661,321
|
|
|
533,192
|
Construction in
progress
|
|
11,779,784
|
|
|
21,524,994
|
|
|
3,134,647
|
Land use right,
net
|
|
1,335,126
|
|
|
1,307,887
|
|
|
190,465
|
Investment in
unconsolidated entity
|
|
-
|
|
|
31,078,971
|
|
|
4,525,976
|
Long-term trade
accounts receivable, net
|
|
4,212,829
|
|
|
-
|
|
|
-
|
Long-term other
receivables, net
|
|
-
|
|
|
440,015
|
|
|
64,079
|
Prepayments for
construction in progress
|
|
474,100
|
|
|
1,144,098
|
|
|
166,613
|
Total
Assets
|
Â¥
|
121,807,517
|
|
Â¥
|
156,981,554
|
|
$
|
22,860,950
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
|
Short-term bank
loan
|
Â¥
|
-
|
|
Â¥
|
2,500,000
|
|
$
|
364,071
|
Trade accounts
payable
|
|
8,754,347
|
|
|
14,089,293
|
|
|
2,051,799
|
Other
payables
|
|
3,255,810
|
|
|
2,366,410
|
|
|
344,617
|
Other payable-
related parties
|
|
3,211,457
|
|
|
2,290,873
|
|
|
333,616
|
Accrued payroll and
employees' welfare
|
|
600,434
|
|
|
1,384,529
|
|
|
201,628
|
Investment
payable
|
|
-
|
|
|
6,400,000
|
|
|
932,021
|
Taxes
payable
|
|
431,913
|
|
|
2,180,847
|
|
|
317,592
|
Short-term
borrowings
|
|
-
|
|
|
1,081,096
|
|
|
157,438
|
Short-term borrowings
- related party
|
|
9,018,065
|
|
|
9,010,525
|
|
|
1,312,187
|
Long-term borrowings
- related party - current portion
|
|
719,895
|
|
|
780,797
|
|
|
113,706
|
Total Current
Liabilities
|
|
25,991,921
|
|
|
42,084,370
|
|
|
6,128,675
|
|
|
|
|
|
|
|
|
|
Long-term borrowings
- related party
|
|
8,943,834
|
|
|
8,196,204
|
|
|
1,193,599
|
Total
Liabilities
|
|
34,935,755
|
|
|
50,280,574
|
|
|
7,322,274
|
|
|
|
|
|
|
|
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
Common stock, ($
0.0185 U.S. dollar par value, 100,000,000 shares
authorized; 21,799,301 shares and 18,380,349 shares issued and
outstanding as of June 30, 2019 and June 30, 2018,
respectively)
|
|
2,279,510
|
|
|
2,712,773
|
|
|
395,056
|
Additional paid-in
capital
|
|
207,490,280
|
|
|
250,624,798
|
|
|
36,498,048
|
Statutory
reserve
|
|
4,148,929
|
|
|
4,148,929
|
|
|
604,201
|
Accumulated
deficit
|
|
(139,424,980)
|
|
|
(164,780,885)
|
|
|
(23,996,750)
|
Accumulated other
comprehensive gain
|
|
1,516,093
|
|
|
2,909,936
|
|
|
423,769
|
Total
stockholders' equity
|
|
76,009,832
|
|
|
95,615,551
|
|
|
13,924,324
|
Non-controlling
interests
|
|
10,861,930
|
|
|
11,085,429
|
|
|
1,614,352
|
Total
equity
|
|
86,871,762
|
|
|
106,700,980
|
|
|
15,538,676
|
Total Liabilities
and Equity
|
Â¥
|
121,807,517
|
|
Â¥
|
156,981,554
|
|
$
|
22,860,950
|
|
The accompanying
notes are an integral part of these consolidated financial
statements
|
RECON TECHNOLOGY,
LTD
|
CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
|
|
|
For the years
ended
|
|
June
30,
|
|
2017
|
|
2018
|
|
2019
|
|
2019
|
|
RMB
|
|
RMB
|
|
RMB
|
|
USD
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
Revenues - third
party
|
Â¥
|
60,054,462
|
|
Â¥
|
84,135,037
|
|
Â¥
|
98,657,433
|
|
$
|
14,367,308
|
Revenues - related
party
|
|
-
|
|
|
577,009
|
|
|
3,726,894
|
|
|
542,741
|
Revenues
|
|
60,054,462
|
|
|
84,712,046
|
|
|
102,384,327
|
|
|
14,910,049
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues and
related tax - third party
|
|
44,090,960
|
|
|
80,097,834
|
|
|
70,316,198
|
|
|
10,240,024
|
Cost of revenues and
related tax - related party
|
|
-
|
|
|
464,027
|
|
|
2,202,765
|
|
|
320,785
|
Cost of revenues
and related tax
|
|
44,090,960
|
|
|
80,561,861
|
|
|
72,518,963
|
|
|
10,560,809
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
15,963,502
|
|
|
4,150,185
|
|
|
29,865,364
|
|
|
4,349,240
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling and
distribution expenses
|
|
4,458,218
|
|
|
8,013,353
|
|
|
9,076,266
|
|
|
1,321,761
|
General and
administrative expenses
|
|
32,751,142
|
|
|
34,687,317
|
|
|
41,288,351
|
|
|
6,012,751
|
Provision for (net
recovery of) doubtful accounts
|
|
1,766,286
|
|
|
(841,242)
|
|
|
610,776
|
|
|
88,945
|
Research and
development expenses
|
|
7,599,340
|
|
|
3,215,653
|
|
|
3,133,545
|
|
|
456,333
|
Operating
expenses
|
|
46,574,986
|
|
|
45,075,081
|
|
|
54,108,938
|
|
|
7,879,790
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
|
(30,611,484)
|
|
|
(40,924,896)
|
|
|
(24,243,574)
|
|
|
(3,530,550)
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expenses)
|
|
|
|
|
|
|
|
|
|
|
|
Subsidy
income
|
|
132,791
|
|
|
371,650
|
|
|
1,149,016
|
|
|
167,329
|
Interest
income
|
|
73,990
|
|
|
68,028
|
|
|
40,391
|
|
|
5,882
|
Interest
expense
|
|
(548,878)
|
|
|
(897,521)
|
|
|
(1,589,045)
|
|
|
(231,410)
|
Loss from investment
in unconsolidated entity
|
|
-
|
|
|
-
|
|
|
(959,905)
|
|
|
(139,789)
|
Impairment loss of
investment in unconsolidated entity
|
|
-
|
|
|
(4,037,736)
|
|
|
-
|
|
|
-
|
Foreign exchange
transaction gain (loss)
|
|
21,502
|
|
|
(4,068)
|
|
|
56,603
|
|
|
8,243
|
Other
income
|
|
36,178
|
|
|
65,539
|
|
|
162,585
|
|
|
23,677
|
Other expense,
net
|
|
(284,417)
|
|
|
(4,434,108)
|
|
|
(1,140,355)
|
|
|
(166,068)
|
Loss before income
tax
|
|
(30,895,901)
|
|
|
(45,359,004)
|
|
|
(25,383,929)
|
|
|
(3,696,618)
|
Income tax
expenses
|
|
307,900
|
|
|
16,230
|
|
|
398,477
|
|
|
58,030
|
Net
loss
|
|
(31,203,801)
|
|
|
(45,375,234)
|
|
|
(25,782,406)
|
|
|
(3,754,648)
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net (loss)
income attributable to non-controlling
interests
|
|
241,346
|
|
|
(1,302,913)
|
|
|
(426,501)
|
|
|
(62,111)
|
Net loss
attributable to Recon Technology, Ltd
|
Â¥
|
(31,445,147)
|
|
Â¥
|
(44,072,321)
|
|
Â¥
|
(25,355,905)
|
|
$
|
(3,692,537)
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
loss
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
(31,203,801)
|
|
|
(45,375,234)
|
|
|
(25,782,406)
|
|
|
(3,754,648)
|
Foreign currency
translation adjustment
|
|
(30,116)
|
|
|
1,765,249
|
|
|
1,393,843
|
|
|
202,983
|
Comprehensive
loss
|
|
(31,233,917)
|
|
|
(43,609,985)
|
|
|
(24,388,563)
|
|
|
(3,551,665)
|
Less: Comprehensive
(loss) income attributable to non-
controlling interests
|
|
241,346
|
|
|
(1,302,913)
|
|
|
(426,501)
|
|
|
(62,111)
|
Comprehensive loss
attributable to Recon Technology,
Ltd
|
Â¥
|
(31,475,263)
|
|
Â¥
|
(42,307,072)
|
|
Â¥
|
(23,962,062)
|
|
$
|
(3,489,554)
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per common
share - basic and diluted
|
Â¥
|
(4.90)
|
|
Â¥
|
(3.84)
|
|
Â¥
|
(1.30)
|
|
$
|
(0.19)
|
Weighted - average
shares - basic and diluted
|
|
6,417,305
|
|
|
11,483,464
|
|
|
19,544,164
|
|
|
19,544,164
|
|
The accompanying
notes are an integral part of these consolidated financial
statements
|
RECON TECHNOLOGY,
LTD
|
STATEMENTS OF CASH
FLOWS
|
|
|
For the years
ended June 30,
|
|
2017
|
|
2018
|
|
2019
|
|
2019
|
|
RMB
|
|
RMB
|
|
RMB
|
|
U.S.
Dollars
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
Â¥
|
(31,203,801)
|
|
Â¥
|
(45,375,234)
|
|
Â¥
|
(25,782,406)
|
|
$
|
(3,754,648)
|
Adjustments to
reconcile net loss to net cash used in
operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
856,735
|
|
|
1,119,049
|
|
|
1,124,011
|
|
|
163,688
|
Gain from disposal of
equipment
|
|
(35,919)
|
|
|
(78,285)
|
|
|
-
|
|
|
-
|
Provision for (net
recovery of) doubtful accounts
|
|
1,766,286
|
|
|
(841,242)
|
|
|
610,776
|
|
|
88,945
|
Provision for slow
moving inventories
|
|
-
|
|
|
65,245
|
|
|
65,380
|
|
|
9,521
|
Share based
compensation
|
|
2,039,446
|
|
|
840,286
|
|
|
9,647,863
|
|
|
1,405,001
|
Restricted shares
issued for management
|
|
12,904,723
|
|
|
14,621,838
|
|
|
11,640,341
|
|
|
1,695,162
|
Loss from investment
in unconsolidated entity
|
|
-
|
|
|
-
|
|
|
959,905
|
|
|
139,789
|
Impairment loss of
investment in unconsolidated entity
|
|
-
|
|
|
4,037,736
|
|
|
-
|
|
|
-
|
Restricted shares
issued for services
|
|
8,399,240
|
|
|
3,050,896
|
|
|
845,781
|
|
|
123,170
|
Changes in
operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
Notes
receivable
|
|
(1,452,783)
|
|
|
2,116,998
|
|
|
922,282
|
|
|
134,310
|
Trade accounts
receivable
|
|
(245,190)
|
|
|
11,972,175
|
|
|
(40,461,376)
|
|
|
(5,892,319)
|
Trade accounts
receivable-related party
|
|
-
|
|
|
-
|
|
|
(3,409,912)
|
|
|
(496,579)
|
Inventories
|
|
3,597,832
|
|
|
(4,196,110)
|
|
|
4,013,314
|
|
|
584,452
|
Other
receivable
|
|
4,579,480
|
|
|
(1,717,096)
|
|
|
(928,882)
|
|
|
(135,271)
|
Purchase
advance
|
|
(10,534,132)
|
|
|
(1,241,102)
|
|
|
8,128,571
|
|
|
1,183,749
|
Prepaid
expense
|
|
(718,130)
|
|
|
318,759
|
|
|
316,845
|
|
|
46,142
|
Prepaid expense -
related parties
|
|
-
|
|
|
-
|
|
|
(217,600)
|
|
|
(31,689)
|
Trade accounts
payable
|
|
812,440
|
|
|
(2,706,304)
|
|
|
(400,034)
|
|
|
(58,256)
|
Other
payables
|
|
(189,302)
|
|
|
(151,751)
|
|
|
(899,476)
|
|
|
(130,989)
|
Other
payables-related parties
|
|
(366,225)
|
|
|
(102,563)
|
|
|
(920,584)
|
|
|
(134,063)
|
Deferred
revenue
|
|
853,044
|
|
|
(1,174,585)
|
|
|
-
|
|
|
-
|
Accrued payroll and
employees' welfare
|
|
1,633,405
|
|
|
140,828
|
|
|
784,095
|
|
|
114,186
|
Taxes
payable
|
|
(78,700)
|
|
|
(269,358)
|
|
|
1,748,934
|
|
|
254,694
|
Net cash used in
operating activities
|
|
(7,381,551)
|
|
|
(19,569,820)
|
|
|
(32,212,172)
|
|
|
(4,691,005)
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
Investment in
unconsolidated entity
|
|
-
|
|
|
(4,037,736)
|
|
|
(4,205,080)
|
|
|
(612,378)
|
Purchases of property
and equipment
|
|
(638,119)
|
|
|
(1,503,410)
|
|
|
(1,735,956)
|
|
|
(252,804)
|
Proceeds from
disposal of equipment
|
|
51,900
|
|
|
32,000
|
|
|
-
|
|
|
-
|
Payments for land use
right
|
|
-
|
|
|
(1,361,969)
|
|
|
-
|
|
|
-
|
Repayments from loans
to third parties
|
|
14,182,624
|
|
|
435,250
|
|
|
1,000,000
|
|
|
145,628
|
Payments made for
loans to third parties
|
|
(1,130,000)
|
|
|
(1,960,000)
|
|
|
(4,000,000)
|
|
|
(582,513)
|
Payments and
prepayments for construction in progress
|
|
-
|
|
|
(9,157,103)
|
|
|
(4,606,823)
|
|
|
(670,884)
|
Net cash provided
by (used in) investing activities
|
|
12,466,405
|
|
|
(17,552,968)
|
|
|
(13,547,859)
|
|
|
(1,972,951)
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from
short-term bank loans
|
|
-
|
|
|
45,000
|
|
|
2,500,000
|
|
|
364,071
|
Repayments of
short-term bank loans
|
|
-
|
|
|
(45,000)
|
|
|
-
|
|
|
-
|
Proceeds from
short-term borrowings
|
|
1,100,000
|
|
|
4,600,000
|
|
|
1,081,096
|
|
|
157,438
|
Repayments of
short-term borrowings
|
|
(1,330,000)
|
|
|
(4,900,000)
|
|
|
-
|
|
|
-
|
Proceeds from
short-term borrowings-related party
|
|
13,103,718
|
|
|
20,188,318
|
|
|
5,000,000
|
|
|
728,141
|
Repayments of
short-term borrowings-related party
|
|
(15,950,682)
|
|
|
(21,332,036)
|
|
|
(5,000,000)
|
|
|
(728,141)
|
Proceeds from
long-term borrowings-related party
|
|
-
|
|
|
10,000,000
|
|
|
-
|
|
|
-
|
Repayments of
long-term borrowings-related party
|
|
-
|
|
|
(371,975)
|
|
|
(684,191)
|
|
|
(99,638)
|
Proceeds from sale of
common stock, net of issuance
costs
|
|
-
|
|
|
65,004,531
|
|
|
-
|
|
|
-
|
Refund of capital
contribution by a non-controlling
shareholder
|
|
-
|
|
|
-
|
|
|
(200,000)
|
|
|
(29,126)
|
Capital contribution
by non-controlling shareholders
|
|
-
|
|
|
3,700,000
|
|
|
850,000
|
|
|
123,784
|
Net cash provided
by (used in) financing activities
|
|
(3,076,964)
|
|
|
76,888,838
|
|
|
3,546,905
|
|
|
516,529
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate fluctuation on cash
|
|
(16,231)
|
|
|
1,765,249
|
|
|
1,393,873
|
|
|
202,991
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase
(decrease) in cash
|
|
1,991,659
|
|
|
41,531,299
|
|
|
(40,819,253)
|
|
|
(5,944,436)
|
Cash at beginning
of year
|
|
1,817,620
|
|
|
3,809,279
|
|
|
45,340,578
|
|
|
6,602,869
|
Cash at end of
year
|
Â¥
|
3,809,279
|
|
Â¥
|
45,340,578
|
|
Â¥
|
4,521,325
|
|
$
|
658,433
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental cash
flow information
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid during
the year for interest
|
Â¥
|
571,037
|
|
Â¥
|
868,042
|
|
Â¥
|
1,542,381
|
|
$
|
224,614
|
Cash paid during
the year for taxes
|
Â¥
|
284,487
|
|
Â¥
|
(22,671)
|
|
Â¥
|
2,002
|
|
$
|
292
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash investing
and financing activities
|
|
|
|
|
|
|
|
|
|
|
|
Shares issued to
settle salary payable
|
Â¥
|
-
|
|
Â¥
|
1,554,908
|
|
Â¥
|
-
|
|
$
|
-
|
Issuance of common
stock in exchange of shares of FGS,
net of issuance costs
|
Â¥
|
|
|
Â¥
|
-
|
|
Â¥
|
21,433,796
|
|
$
|
3,121,366
|
Investment payable in
exchange of interest of FGS
|
Â¥
|
-
|
|
Â¥
|
-
|
|
Â¥
|
6,400,000
|
|
$
|
932,021
|
Payable for
Construction in Progress
|
Â¥
|
-
|
|
Â¥
|
3,096,781
|
|
Â¥
|
5,694,980
|
|
$
|
829,350
|
Non-cash payment for
property and equipment purchase
|
Â¥
|
87,265
|
|
Â¥
|
-
|
|
Â¥
|
-
|
|
$
|
-
|
Issuance of unvested
common stock to senior managers
|
Â¥
|
55,685
|
|
Â¥
|
-
|
|
Â¥
|
-
|
|
$
|
-
|
Receivable for
disposal of property and equipment
|
Â¥
|
-
|
|
Â¥
|
81,900
|
|
Â¥
|
-
|
|
$
|
-
|
|
The accompanying
notes are an integral part of these consolidated financial
statements
|
View original
content:http://www.prnewswire.com/news-releases/recon-technology-reports-financial-results-for-fiscal-year-2019-with-revenue-reaching-a-new-historical-high-and-losses-narrowed-300926799.html
SOURCE Recon Technology, Ltd.