BEIJING, May 18, 2015 /PRNewswire/ -- Recon Technology,
Ltd. (NASDAQ: RCON), ("Recon"
or the "Company"), a leading independent oilfield services provider
operating primarily in China,
today reported its financial results for the third
quarter of fiscal year 2015, which ended March 31, 2015.
Q3 FY2015 Financial Highlights:
- Total revenues for the third quarter of FY2015 were RMB20.0 million ($3.3
million), an increase of 9.8% from the same period of
FY2014.
- Gross profit for the third quarter of FY2015 was RMB6.2 million ($1.0
million), an increase of 19.1% from the same period of
FY2014. Gross margin also expanded by 2.4 points to 31.2% for the
third quarter of FY2015 from 28.8% for the same period of
FY2014.
- Operating income was RMB0.4
million ($0.1 million) for the third
quarter of FY2015, compared to an operating loss of RMB0.6 million for the same period of
FY2014.
- Net loss attributable to Recon for the third quarter of FY2015
was RMB1.5 million ($0.2 million), or RMB0.32 ($0.05) loss per diluted share, compared to
RMB1.9 million, or RMB0.43 loss per diluted share, for the same
period of FY2014.
- Adjusted EBITDA (non-GAAP) was RMB1.7 million ($0.3
million) for the third quarter of FY2015, compared to
RMB0.5 million for the same period
of FY2014.
- Adjusted net income attributable to Recon was RMB1.3 million ($0.2
million), or RMB0.28
($0.05) per diluted shares, for the
third quarter of FY2015, compared to adjusted net loss attributable
to Recon of RMB0.1 million, or
RMB0.03 loss per diluted share, for
the same period of FY2014.
Mr. Shenping Yin, Chairman and
CEO of Recon stated, "It has been a challenging quarter for the oil
and gas industry with the plunge in oil and gas prices continuing
to put severe pressure on China's already-weak growth momentum,
forcing many of our major customers to cut their CAPEX budget and
to cancel or delay projects and thus hampering our efforts to carry
out business plan. Despite these challenges, revenues increased by
9.8% from the same quarter last year while both gross and operating
margins also improved from a year ago, thanks to solid contribution
from our automation business as a result of our heightened sales
and marketing effort."
Mr. Yin continued, "While we continue to face significant
headwinds in the near term, we believe challenges can turn into
potential opportunities for us as our competitors also struggle to
stay afloat. With relatively light in assets, strong R&D
capability, and deep industry connections forged by years of
providing a wide range of hardware, software and service solutions
to leading SOEs such as Sinopec and Petro
China, in our view Recon is well prepared to withstand the
challenges ahead."
Third Quarter FY2015 Financial Results
|
|
For the Three
Months Ended March 31,
|
|
|
2014
|
|
2015
|
|
2015
|
|
%
|
(thousands)
|
|
RMB
|
|
RMB
|
|
USD
|
|
Change
|
Revenues
|
|
|
18,232
|
|
|
20,019
|
|
|
3,277
|
|
9.8%
|
Hardware and
software
|
|
|
17,998
|
|
|
18,359
|
|
|
3,005
|
|
2.0%
|
Service
|
|
|
80
|
|
|
-
|
|
|
-
|
|
-100.0%
|
Hardware and software
- related parties
|
|
|
154
|
|
|
1,660
|
|
|
272
|
|
979.0%
|
Gross
margin
|
|
|
28.8%
|
|
|
31.2%
|
|
|
31.2%
|
|
2.4%
|
Operating (loss)
margin
|
|
|
-3.1%
|
|
|
2.0%
|
|
|
2.0%
|
|
5.1%
|
Net income (loss)
attributable to RCON
|
|
|
(1,931)
|
|
|
(1,527)
|
|
|
(250)
|
|
NM
|
Diluted earnings per
share
|
|
|
(0.43)
|
|
|
(0.32)
|
|
|
(0.05)
|
|
NM
|
Revenues
For the three months ended March 31,
2015, total revenues increased by RMB1.8 million, or 9.8%, to RMB20.0 million ($3.3
million) from RMB18.2
million for the same period of last fiscal year. The increase in
total revenues was mainly related to demand of our automation
business from our related parties. Revenues from non-related parties hardware and software sales
increased by RMB0.4 million, or
2.0%, to RMB18.4 million
($3.0 million) for the three months
ended March 31, 2015, compared to
RMB18.0 million for the same period
of last fiscal year. Revenues from related-party hardware and
software sales increased by RMB1.5
million, or 979.0%, to RMB1.7
million ($0.3 million) for the three
months ended March 31, 2015, compared
to RMB0.2 million for the same
period of last fiscal year. We did not book revenues from our
service business for the three months ended March 31, 2015, compared to RMB0.1 million for the same period of last
fiscal year.
Gross profit and gross margin
Gross profit increased by RMB1.0
million, or 19.1%, to RMB6.2
million ($1.0 million) for the three
months ended March 31, 2015 from
RMB5.2 million for the same period
of last fiscal year. Overall gross margin increased to 31.2% for
the three months ended March 31, 2015
from 28.8% for the same period of last fiscal year. The increases
in overall gross profit and gross margin were mainly related to our
automation software business. Gross margins for hardware and
software sales to non-related parties and related parties were
25.1% and 99.4% for the three months ended March 31, 2015, compared to 28.6% and 36.8% for
the same period of last fiscal year, respectively. We did not book
revenues for our service business for the three months ended
March 31, 2015, compared to gross
profit and gross margin for our service business of RMB0.04 million and 47.4%, respectively, for
the same period of last fiscal year.
Operating income (loss) and operating (loss) margin
Selling and distribution expenses increased slightly by 1.1% to
RMB1.1 million for the three months
ended March 31, 2015. General and
administrative expenses increased by RMB0.2 million, or 5.0%, to RMB4.2 million for the three months ended
March 31, 2015 from RMB4.0 million for the same period of last
fiscal year. Research and development expenses decreased by
RMB0.2 million, or 24.5%, to
RMB0.5 million for the three months
ended March 31, 2015 from RMB0.7 million for the same period of last
fiscal year. Total operating expenses were essentially unchanged at
RMB5.8 million ($1.0 million) for the three months ended
March 31, 2015.
Operating income of RMB0.4
million ($0.1 million) for the three
months ended March 31, 2015 compared
to operating loss of RMB0.6 million
for the same period of last fiscal year. Operating margin was 2.0%
for the three months ended March 31,
2015, compared to operating loss margin of 3.1% for the same
period of last fiscal year.
Net loss
Net loss for the three months ended March
31, 2015 was RMB1.4 million
($0.2 million), compared to RMB1.8 million for the same period of last
fiscal year. After deduction of non-controlling interest, net loss
for our shareholders was RMB1.5
million ($0.3 million), or RMB0.32 ($0.05) loss per diluted share, for the three
months ended March 31, 2015, compared
to RMB1.9 million, or RMB0.43 loss per diluted share, for the same
period of last fiscal year.
Non-GAAP Measures
|
|
For the Three
Months Ended March 31,
|
|
|
2014
|
|
2015
|
|
2015
|
(thousands)
|
|
RMB
|
|
RMB
|
|
USD
|
Net income
(loss)
|
|
|
(1,810)
|
|
|
(1,416)
|
|
|
(232)
|
Provision for income
taxes
|
|
|
151
|
|
|
(181)
|
|
|
(30)
|
Interest expenses and
foreign currency adjustment
|
|
|
246
|
|
|
337
|
|
|
55
|
Change in fair value
of warrants liability
|
|
|
905
|
|
|
9
|
|
|
2
|
Loss from
investment
|
|
|
136
|
|
|
-
|
|
|
-
|
Restricted shares
issued for consulting services
|
|
|
-
|
|
|
34
|
|
|
5
|
Loss from warrants
redemption
|
|
|
-
|
|
|
1,913
|
|
|
313
|
Stock compensation
expense
|
|
|
765
|
|
|
909
|
|
|
149
|
Depreciation and
amortization
|
|
|
156
|
|
|
95
|
|
|
16
|
Adjusted
EBITDA
|
|
|
548
|
|
|
1,700
|
|
|
278
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to RCON
|
|
|
(1,931)
|
|
|
(1,527)
|
|
|
(250)
|
Change in fair value
of warrants liability
|
|
|
905
|
|
|
9
|
|
|
2
|
Loss from
investment
|
|
|
136
|
|
|
-
|
|
|
-
|
Restricted shares
issued for consulting services
|
|
|
-
|
|
|
34
|
|
|
5
|
Loss from warrants
redemption
|
|
|
-
|
|
|
1,913
|
|
|
313
|
Stock compensation
expense
|
|
|
765
|
|
|
909
|
|
|
149
|
Adjusted net
income attributable to RCON
|
|
|
(126)
|
|
|
1,337
|
|
|
219
|
Adjusted earnings
(loss) per diluted share
|
|
|
(0.03)
|
|
|
0.28
|
|
|
0.05
|
Adjusted EBITDA (non-GAAP), which we define as net income (loss)
adjusted for income tax expense, interest expense, loss from
investment, non-cash stock compensation expense, depreciation and
amortization, was RMB1.7 million
($0.3 million) for the three months
ended March 31, 2015, compared to
RMB0.5 million for the same period
of last fiscal year. Adjusted net income attributable to our
shareholders was RMB1.3 million
($0.2 million), or RMB0.28 ($0.05) per diluted shares, for the three months
ended March 31, 2015, compared to
adjusted net loss attributable to our common shareholders of
RMB0.1 million, or RMB0.03 loss per diluted share, for the same
period of last fiscal year.
Year-to-Date (Nine Months) FY2015 Financial Results
|
|
For the Nine
Months Ended March 31,
|
|
|
2014
|
|
2015
|
|
2015
|
|
%
|
(thousands)
|
|
RMB
|
|
RMB
|
|
USD
|
|
Change
|
Revenues
|
|
|
76,012
|
|
|
45,652
|
|
|
7,473
|
|
-39.9%
|
Hardware and
software
|
|
|
73,338
|
|
|
43,120
|
|
|
7,059
|
|
-41.2%
|
Service
|
|
|
478
|
|
|
104
|
|
|
17
|
|
-78.3%
|
Hardware and software
- related parties
|
|
|
2,196
|
|
|
2,428
|
|
|
397
|
|
10.6%
|
Gross
margin
|
|
|
35.6%
|
|
|
34.7%
|
|
|
34.7%
|
|
-0.9%
|
Operating (loss)
margin
|
|
|
-25.3%
|
|
|
-3.6%
|
|
|
-3.6%
|
|
21.7%
|
Net income (loss)
attributable to RCON
|
|
|
3,931
|
|
|
(363)
|
|
|
(59)
|
|
NM
|
Diluted earnings per
share
|
|
|
0.92
|
|
|
(0.08)
|
|
|
(0.01)
|
|
NM
|
Revenues
For the nine months ended March 31,
2015, total revenues decreased by RMB30.4 million ($5.0
million), or 39.9%, to RMB45.7 million ($7.5
million) from RMB76.0
million for the same period of last fiscal year as a result of
weakness across all of our businesses, particularly during the
first half of fiscal year 2015. Revenues from non-related party
hardware and software sales decreased by RMB30.2 million, or 41.2%, to RMB43.1 million ($7.1
million) for the nine months ended March 31, 2015, compared to RMB73.3 million for the same period of last
fiscal year. Revenues from related-party hardware and software
sales increased by RMB0.2 million,
or 10.6%, to RMB2.4 million
($0.4 million) for the nine months
ended March 31, 2015, compared to
RMB2.2 million for the same period
of last fiscal year. Revenues from service decreased by RMB0.4 million, or 78.3%, to RMB0.1 million ($0.02
million) for the nine months ended March 31, 2015, compared to RMB0.5 million for the same period of last
fiscal year.
Gross profit and gross margin
Gross profit decreased by RMB11.2 million, or 41.5%, to RMB15.8 million ($2.6
million) for the nine months ended March 31, 2015 from RMB27.1 million for the same period of last
fiscal year. Overall gross margin decreased to 34.7% for the nine
months ended March 31, 2015 from
35.6% for the same period of last fiscal year. The decreases in
gross profit were across all of our businesses. Gross margins for
hardware and software sales to non-related parties and related
parties were 30.9% and 98.9% for the nine months ended March 31, 2015, compared to 33.9% and 80.6% for
the same period of last fiscal year, respectively.
Operating income (loss) and operating (loss) margin
Selling and distribution expenses decreased by RMB1.6 million, or 34.8%, to RMB3.1 million for the nine months ended
March 31, 2015 from RMB4.7 million for the same period of last
fiscal year. General and administrative expenses increased by
RMB1.5 million, or 14.7%, to
RMB12.0 million for the nine months
ended March 31, 2015 from RMB10.5 million for the same period of last
fiscal year. Research and development expenses decreased by
RMB1.6 million, or 40.0%, to
RMB2.4 million for the nine months
ended March 31, 2015 from RMB4.1 million for the same period of last
fiscal year. Total operating expenses decreased by RMB1.7 million, or 9.0%, to RMB17.5 million ($2.9
million) for the nine months ended March 31, 2015 from RMB19.2 million for the same period of last
fiscal year.
Operating loss was RMB1.7
million ($0.3 million) for the nine
months ended March 31, 2015, compared
to operating income of RMB7.8
million for the same period of last fiscal year. Operating loss
margin was 3.6% for the nine months ended March 31, 2015, compared to operating margin of
10.3% for the same period of last fiscal year.
Net income (loss)
Net income for the nine months ended March 31, 2015 was RMB0.2 million ($0.03
million), compared to RMB5.0
million for the same period of last fiscal year. After deduction of
non-controlling interest, net loss for our shareholders was
RMB0.4 million ($0.06 million), or RMB0.08 ($0.01) loss per diluted share, for the nine
months ended March 31, 2015, compared
to net income attributable to our shareholders of RMB3.9 million, or RMB0.92 per diluted share, for the same
period of last fiscal year.
Non-GAAP Measures
|
|
For the Nine
Months Ended March 31,
|
|
|
2014
|
|
2015
|
|
2015
|
(thousands)
|
|
RMB
|
|
RMB
|
|
USD
|
Net income
(loss)
|
|
|
4,976
|
|
|
183
|
|
|
30
|
Provision for income
taxes
|
|
|
1,610
|
|
|
468
|
|
|
77
|
Interest expenses and
foreign currency adjustment
|
|
|
845
|
|
|
827
|
|
|
135
|
Change in fair value
of warrants liability
|
|
|
904
|
|
|
(4,068)
|
|
|
(666)
|
Loss from
investment
|
|
|
871
|
|
|
-
|
|
|
-
|
Restricted shares
issued for consulting services
|
|
|
408
|
|
|
1,205
|
|
|
197
|
Loss from warrants
redemption
|
|
|
-
|
|
|
1,913
|
|
|
313
|
Stock compensation
expense
|
|
|
1,660
|
|
|
2,024
|
|
|
331
|
Depreciation and
amortization
|
|
|
457
|
|
|
369
|
|
|
60
|
Adjusted
EBITDA
|
|
|
11,732
|
|
|
2,921
|
|
|
478
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to RCON
|
|
|
3,931
|
|
|
(363)
|
|
|
(59)
|
Change in fair value
of warrants liability
|
|
|
904
|
|
|
(4,068)
|
|
|
(666)
|
Loss from
investment
|
|
|
871
|
|
|
-
|
|
|
-
|
Restricted shares
issued for consulting services
|
|
|
408
|
|
|
1,205
|
|
|
197
|
Loss from warrants
redemption
|
|
|
-
|
|
|
1,913
|
|
|
313
|
Stock compensation
expense
|
|
|
1,660
|
|
|
2,023
|
|
|
331
|
Adjusted net
income attributable to RCON
|
|
|
7,774
|
|
|
710
|
|
|
116
|
Adjusted earnings
per diluted share
|
|
|
1.81
|
|
|
0.15
|
|
|
0.02
|
Adjusted EBITDA (non-GAAP), which we define as net income (loss)
adjusted for income tax expense, interest expense, loss from
investment, non-cash stock compensation expense, depreciation and
amortization, was RMB2.9 million
($0.5 million) for the nine months
ended March 31, 2015, compared to
RMB11.7 million for the same period
of last fiscal year. Adjusted net income attributable to our
shareholders was RMB0.7 million
($0.1 million), or RMB0.15 ($0.02) per diluted shares, for the nine months
ended March 31, 2015, compared to
RMB7.8 million, or RMB1.81 per diluted share, for the same
period of last fiscal year.
Financial Position
As of March 31, 2015, the Company
had cash and cash equivalents of RMB4.7 million ($0.8
million), short-term bank loans of RMB8.0 million ($1.3
million), and short-term loan to related parties of
RMB10.2 million ($1.7 million), compared to RMB18.1 million, RMB10.0 million, and RMB5.2 million, respectively, at
June 30, 2014. Working capital as of
March 31, 2015 was RMB90.1 million ($14.7 million) as compared to RMB83.1 million at June 30, 2014. Net cash used in operating
activities was RMB16.2 million
($2.7 million) for the nine months
ended March 31, 2015, compared to
RMB15.3 million for the same period
of last fiscal year. Net cash used in investing activities was
RMB0.2 million ($0.03 million) for the nine months ended
March 31, 2015, essentially unchanged
from a year ago. Net cash provided by financing activities was
RMB3.0 million ($0.5 million) for the nine months ended
March 31, 2015, compared to
RMB11.9 million for the same period
of last fiscal year. During the fiscal 2015 nine-month period, we
repaid RMB2.0 million in short term
bank loans and received RMB5.0
million net proceeds from a related party.
Recent Development
On February 18, 2015, the Company
announced that it has signed an agreement with Aktobe Petroleum
Machinery Co. Ltd., an affiliate of the Company's key customer
-- Petro
China, to jointly construct a pressure container technical
service center for heating furnaces and separators in Kazakhstan.
On January 29, 2015, the Company
held its annual general meeting of stockholders at which a majority
of the Company's shareholders voted for: 1) an increase of
authorized shares from 25 million to 75 million; 2) election of
directors; 3) an approval of the Company's 2015 Equity Incentive
Plan; and 4) the ratification of Friedman LLP as the Company's
independent registered public accounting firm for FY2015 ending
June 30, 2015.
About Recon
Recon Technology, Ltd. is China's first independent
oil and gas field service company listed on NASDAQ
(RCON). Closely working with leading global partners, Recon
has achieved rapid growth supplying China's largest oil
and gas exploration companies, including Sinopec and China National
Petroleum Corporation, with advanced automated technologies,
efficient gathering and transportation equipment and reservoir
stimulation measures. The solutions Recon provides are aimed at
increasing gas and petroleum extraction levels, reducing
impurities, improving safety and lowering production costs. For
additional information, please visit www.recon.cn.
Cautionary Statements
Statements made in this release with respect to Recon's
current plans, estimates, strategies and beliefs and other
statements that are not historical facts are forward-looking
statements about the future performance of Recon. Forward-looking
statements include, but are not limited to, those statements using
words such as "believe," "expect," "plans," "strategy,"
"prospects," "forecast," "estimate," "project," "anticipate,"
"aim," "intend," "seek," "may," "might," "could" or "should," and
words of similar meaning in connection with a discussion of future
operations, financial performance, events or conditions. From time
to time, oral or written forward-looking statements may also be
included in other materials released to the public. These
statements are based on management's assumptions, judgments and
beliefs in light of the information currently available to it.
Recon cautions investors that a number of important risks and
uncertainties could cause actual results to differ materially from
those discussed in the forward-looking statements, 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. Therefore investors should not place undue reliance on
such forward-looking statements. Actual results may differ
significantly from those set forth in the forward-looking
statements.
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.
Contact:
Recon Technology, Ltd.
Tel: +86-10-8494-5799
Email: info@recon.cn
Web: http://www.recon.cn
Weitian Investor Relations
Tina Xiao
Tel: +1-917-609-0333
Email: tina.xiao@weitian-ir.com
RECON TECHNOLOGY,
LTD
|
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
|
As of June
30,
|
|
As of March 31,
|
|
As of March 31,
|
|
2014
|
|
2015
|
|
2015
|
ASSETS
|
RMB
|
|
RMB
|
|
USD
|
Current
assets
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
18,094,586
|
|
|
4,665,869
|
|
|
763,757
|
Notes
receivable
|
|
-
|
|
|
400,000
|
|
|
65,476
|
Trade accounts
receivable, net
|
|
43,553,737
|
|
|
56,444,463
|
|
|
9,239,407
|
Trade accounts
receivable - related parties, net
|
|
7,479,298
|
|
|
4,860,821
|
|
|
795,669
|
Inventories,
net
|
|
14,336,602
|
|
|
19,127,861
|
|
|
3,131,044
|
Other receivables,
net
|
|
18,293,043
|
|
|
27,180,449
|
|
|
4,449,174
|
Other receivables -
related parties
|
|
1,414,433
|
|
|
-
|
|
|
-
|
Purchase advances,
net
|
|
25,759,065
|
|
|
22,870,397
|
|
|
3,743,660
|
Purchase advances -
related parties
|
|
394,034
|
|
|
394,034
|
|
|
64,500
|
Prepaid
expenses
|
|
2,634,664
|
|
|
4,200,662
|
|
|
687,608
|
Prepaid expenses -
related parties
|
|
230,000
|
|
|
362,400
|
|
|
59,321
|
Deferred tax
asset
|
|
1,209,961
|
|
|
1,260,442
|
|
|
206,322
|
Total current
assets
|
|
133,399,423
|
|
|
141,767,398
|
|
|
23,205,938
|
|
|
|
|
|
|
|
|
|
Property and
equipment, net
|
|
1,321,538
|
|
|
1,273,521
|
|
|
208,463
|
Long-term trade
accounts receivable, net
|
|
|
|
|
14,545,865
|
|
|
2,381,016
|
Long-term trade
accounts receivable - related parties, net
|
|
14,456,317
|
|
|
|
|
|
-
|
Long-term
investment
|
|
-
|
|
|
-
|
|
|
-
|
Long-term other
receivable
|
|
5,353,104
|
|
|
3,394,731
|
|
|
555,684
|
Total
Assets
|
|
154,530,382
|
|
|
160,981,515
|
|
|
26,351,101
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
|
Short-term bank
loans
|
|
10,000,000
|
|
|
8,000,000
|
|
|
1,309,522
|
Trade accounts
payable
|
|
11,413,505
|
|
|
17,456,282
|
|
|
2,857,423
|
Other
payables
|
|
1,765,079
|
|
|
1,199,015
|
|
|
196,267
|
Other payable -
related parties
|
|
3,306,024
|
|
|
3,725,403
|
|
|
609,812
|
Deferred
revenue
|
|
4,419,824
|
|
|
2,776,485
|
|
|
454,483
|
Advances from
customers
|
|
801,385
|
|
|
395,600
|
|
|
64,756
|
Accrued payroll and
employees' welfare
|
|
417,624
|
|
|
309,558
|
|
|
50,672
|
Accrued
expenses
|
|
203,051
|
|
|
356,980
|
|
|
58,435
|
Taxes
payable
|
|
7,589,846
|
|
|
6,900,393
|
|
|
1,129,527
|
Short-term borrowings
- related parties
|
|
5,207,728
|
|
|
10,218,308
|
|
|
1,612,637
|
Deferred tax
liability
|
|
180,186
|
|
|
180,186
|
|
|
29,495
|
Warrants
liability
|
|
5,021,621
|
|
|
199,179
|
|
|
32,604
|
Total current
liabilities
|
|
50,325,873
|
|
|
51,717,389
|
|
|
8,465,633
|
|
|
|
|
|
|
|
|
|
Commitments and
Contingency
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
Common stock, ($
0.0185 U.S. dollar par value, 25,000,000 shares authorized;
4,717,336 and 5,022,436 shares issued and outstanding as of June
30, 2014 and March 31, 2015, respectively)
|
|
616,865
|
|
|
651,495
|
|
|
106,641
|
Additional paid-in
capital
|
|
83,061,058
|
|
|
87,906,399
|
|
|
14,389,419
|
Appropriated retained
earnings
|
|
4,148,929
|
|
|
4,725,803
|
|
|
773,568
|
Unappropriated
retained earnings
|
|
8,431,453
|
|
|
7,491,128
|
|
|
1,226,224
|
Accumulated other
comprehensive loss
|
|
(279,275)
|
|
|
(282,129)
|
|
|
(46,183)
|
Total
shareholders' equity
|
|
95,979,030
|
|
|
100,492,696
|
|
|
16,449,669
|
Non-controlling
interest
|
|
8,225,479
|
|
|
8,771,430
|
|
|
1,435,799
|
Total
equity
|
|
104,204,509
|
|
|
109,264,126
|
|
|
17,885,468
|
Total Liabilities
and Equity
|
|
154,530,382
|
|
|
160,981,515
|
|
|
26,514,791
|
|
|
|
|
|
|
|
|
|
RECON TECHNOLOGY,
LTD
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
INCOME (LOSS)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the nine
months ended
|
|
For the three
months ended
|
|
March
31,
|
|
March
31,
|
|
2014
|
|
2015
|
|
2015
|
|
2014
|
|
2015
|
|
2015
|
|
RMB
|
|
RMB
|
|
USD
|
|
RMB
|
|
RMB
|
|
USD
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hardware and
software
|
|
73,337,585
|
|
|
43,119,915
|
|
|
7,058,309
|
|
|
17,998,444
|
|
|
18,358,835
|
|
|
3,005,162
|
Service
|
|
477,769
|
|
|
103,774
|
|
|
16,987
|
|
|
80,180
|
|
|
-
|
|
|
-
|
Hardware and software
- related parties
|
|
2,196,152
|
|
|
2,428,173
|
|
|
397,468
|
|
|
153,846
|
|
|
1,660,055
|
|
|
271,735
|
Total
revenues
|
|
76,011,506
|
|
|
45,651,862
|
|
|
7,472,764
|
|
|
18,232,470
|
|
|
20,018,890
|
|
|
3,276,897
|
Cost of
revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hardware and
software
|
|
48,447,792
|
|
|
29,782,617
|
|
|
4,875,124
|
|
|
12,848,136
|
|
|
13,759,652
|
|
|
2,252,321
|
Service
|
|
77,107
|
|
|
-
|
|
|
-
|
|
|
42,161
|
|
|
-
|
|
|
-
|
Hardware and software
- related parties
|
|
426,139
|
|
|
27,161
|
|
|
4,446
|
|
|
97,217
|
|
|
10,399
|
|
|
1,702
|
Total cost of
revenues
|
|
48,951,038
|
|
|
29,809,778
|
|
|
4,879,570
|
|
|
12,987,514
|
|
|
13,770,051
|
|
|
2,254,023
|
Gross
profit
|
|
27,060,468
|
|
|
15,842,084
|
|
|
2,593,194
|
|
|
5,244,956
|
|
|
6,248,839
|
|
|
1,022,874
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling and
distribution expenses
|
|
4,701,989
|
|
|
3,065,098
|
|
|
501,727
|
|
|
1,097,549
|
|
|
1,109,838
|
|
|
181,670
|
General and
administrative expenses
|
|
10,450,904
|
|
|
11,987,761
|
|
|
1,962,279
|
|
|
3,993,341
|
|
|
4,191,030
|
|
|
686,031
|
Research and
development expenses
|
|
4,074,953
|
|
|
2,444,020
|
|
|
400,062
|
|
|
720,956
|
|
|
544,063
|
|
|
89,058
|
Operating
expenses
|
|
19,227,846
|
|
|
17,496,879
|
|
|
2,864,068
|
|
|
5,811,846
|
|
|
5,844,931
|
|
|
956,759
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
7,832,622
|
|
|
(1,654,795)
|
|
|
(270,874)
|
|
|
(566,890)
|
|
|
403,908
|
|
|
66,115
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expenses)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subsidy
income
|
|
1,220,024
|
|
|
639,473
|
|
|
104,675
|
|
|
201,711
|
|
|
155,155
|
|
|
25,397
|
Interest
income
|
|
296,997
|
|
|
225,701
|
|
|
36,945
|
|
|
92,027
|
|
|
68,233
|
|
|
11,169
|
Interest
expense
|
|
(757,226)
|
|
|
(808,065)
|
|
|
(132,272)
|
|
|
(277,578)
|
|
|
(339,109)
|
|
|
(55,509)
|
Loss from
investment
|
|
(870,627)
|
|
|
-
|
|
|
-
|
|
|
(135,547)
|
|
|
-
|
|
|
-
|
Change in fair value
of warrants liability
|
|
(904,327)
|
|
|
4,068,329
|
|
|
665,946
|
|
|
(904,883)
|
|
|
(9,188)
|
|
|
(1,504)
|
Loss from foreign
currency exchange
|
|
(88,080)
|
|
|
(19,081)
|
|
|
(3,123)
|
|
|
31,312
|
|
|
1,799
|
|
|
294
|
Loss from warrants
redemption
|
|
-
|
|
|
(1,913,262)
|
|
|
(313,182)
|
|
|
-
|
|
|
(1,913,262)
|
|
|
(313,182)
|
Other
expense
|
|
(143,498)
|
|
|
112,325
|
|
|
18,387
|
|
|
(99,552)
|
|
|
35,653
|
|
|
5,836
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss)
before income tax
|
|
6,585,885
|
|
|
650,625
|
|
|
106,502
|
|
|
(1,659,400)
|
|
|
(1,596,811)
|
|
|
(261,384)
|
Provision (benefit)
for income tax
|
|
1,609,976
|
|
|
468,005
|
|
|
76,608
|
|
|
150,787
|
|
|
(180,927)
|
|
|
(29,616)
|
Net Income
(loss)
|
|
4,975,909
|
|
|
182,620
|
|
|
29,894
|
|
|
(1,810,187)
|
|
|
(1,415,884)
|
|
|
(231,768)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Net income
attributable to non-controlling interest
|
|
1,045,396
|
|
|
546,071
|
|
|
89,386
|
|
|
120,415
|
|
|
111,398
|
|
|
18,235
|
Net Income (loss)
attributable to Recon Technology, Ltd
|
|
3,930,513
|
|
|
(363,451)
|
|
|
(59,492)
|
|
|
(1,930,602)
|
|
|
(1,527,282)
|
|
|
(250,003)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
income (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
4,975,909
|
|
|
182,620
|
|
|
29,894
|
|
|
(1,810,187)
|
|
|
(1,415,884)
|
|
|
(231,768)
|
Foreign currency
translation adjustment
|
|
(40,833)
|
|
|
(2,854)
|
|
|
(467)
|
|
|
(118,110)
|
|
|
(7,580)
|
|
|
(1,241)
|
Comprehensive
income (loss)
|
|
4,935,076
|
|
|
179,766
|
|
|
29,427
|
|
|
(1,928,297)
|
|
|
(1,423,464)
|
|
|
(233,009)
|
Less: Comprehensive
income attributable to non-controlling interest
|
|
1,041,313
|
|
|
545,952
|
|
|
89,367
|
|
|
108,604
|
|
|
111,032
|
|
|
18,175
|
Comprehensive
income (loss) attributable to Recon Technology, Ltd
|
|
3,893,763
|
|
|
(366,186)
|
|
|
(59,940)
|
|
|
(2,036,901)
|
|
|
(1,534,496)
|
|
|
(251,184)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss)
per common share - basic
|
|
0.93
|
|
|
(0.08)
|
|
|
(0.01)
|
|
|
(0.43)
|
|
|
(0.32)
|
|
|
(0.05)
|
Earnings (loss)
per common share - diluted
|
|
0.92
|
|
|
(0.08)
|
|
|
(0.01)
|
|
|
(0.43)
|
|
|
(0.32)
|
|
|
(0.05)
|
Weighted - average
shares - basic
|
|
4,211,785
|
|
|
4,773,803
|
|
|
4,757,112
|
|
|
4,528,311
|
|
|
4,839,004
|
|
|
4,839,004
|
Weighted - average
shares - diluted
|
|
4,269,510
|
|
|
4,773,803
|
|
|
4,757,112
|
|
|
4,528,311
|
|
|
4,839,004
|
|
|
4,839,004
|
|
RECON TECHNOLOGY,
LTD
|
UNAUDITED
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
For the nine
months ended
|
|
2014
|
|
2015
|
|
2015
|
|
RMB
|
|
RMB
|
|
USD
|
|
|
|
|
|
|
|
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
Net
income
|
|
4,975,909
|
|
|
182,620
|
|
|
29,894
|
Adjustments to
reconcile net income to net cash used in operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation
|
|
457,439
|
|
|
369,284
|
|
|
60,448
|
Loss from disposal of
equipment
|
|
67,587
|
|
|
(149,504)
|
|
|
(24,472)
|
Provision for
doubtful accounts
|
|
668,610
|
|
|
254,622
|
|
|
41,679
|
Share based
compensation
|
|
1,660,144
|
|
|
2,023,761
|
|
|
331,270
|
Loss from
investment
|
|
870,627
|
|
|
-
|
|
|
-
|
Deferred tax
benefit
|
|
(75,715)
|
|
|
(50,481)
|
|
|
(8,263)
|
Change in fair value
of warrants liability
|
|
904,327
|
|
|
(4,068,329)
|
|
|
(665,946)
|
Restricted shares
issued for services
|
|
407,972
|
|
|
1,204,903
|
|
|
197,231
|
Loss from warrants
redemption
|
|
-
|
|
|
1,913,262
|
|
|
313,182
|
Changes in
operating assets and liabilities:
|
|
|
|
|
|
|
|
|
Trade accounts
receivable
|
|
(17,127,239)
|
|
|
(29,115,292)
|
|
|
(4,765,889)
|
Trade accounts
receivable - related parties
|
|
1,487,501
|
|
|
18,681,051
|
|
|
3,057,906
|
Inventories
|
|
(8,823,683)
|
|
|
(4,791,259)
|
|
|
(784,282)
|
Notes
receivable
|
|
2,578,855
|
|
|
(400,000)
|
|
|
(65,476)
|
Other receivable,
net
|
|
688,724
|
|
|
(7,022,533)
|
|
|
1,149,521
|
Other receivables
related parties, net
|
|
77,697
|
|
|
1414,433
|
|
|
231,529
|
Purchase advance,
net
|
|
(5,325,269)
|
|
|
1,797,628
|
|
|
294,254
|
Tax
recoverable
|
|
575,650
|
|
|
-
|
|
|
-
|
Prepaid
expense
|
|
(580,144)
|
|
|
(1,565,998)
|
|
|
(256,339)
|
Prepaid expense -
related party, net
|
|
-
|
|
|
(132,400)
|
|
|
(21,673)
|
Trade accounts
payable
|
|
6,211,777
|
|
|
6,042,777
|
|
|
989,144
|
Trade accounts
payable - related parties
|
|
(3,994,718)
|
|
|
-
|
|
|
-
|
Other
payables
|
|
(191,528)
|
|
|
(566,064)
|
|
|
92,659
|
Other payables -
related parties
|
|
(857,338)
|
|
|
419,379
|
|
|
68,648
|
Deferred
income
|
|
945,091
|
|
|
(1,643,339)
|
|
|
(268,999)
|
Advances from
customers
|
|
(195,100)
|
|
|
(405,785)
|
|
|
(66,423)
|
Accrued payroll and
employees' welfare
|
|
(1,603,340)
|
|
|
(108,066)
|
|
|
(17,689)
|
Accrued
expenses
|
|
(242,617)
|
|
|
185,433
|
|
|
30,354
|
Taxes
payable
|
|
1,155,303
|
|
|
(689,453)
|
|
|
(112,857)
|
Net cash used in
operating activities
|
|
(15,283,478)
|
|
|
(16,219,350)
|
|
|
(2,654,949)
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Purchase of property
and equipment
|
|
(258,922)
|
|
|
(514,009)
|
|
|
(84,138)
|
Proceeds from
disposal of equipment
|
|
98,000
|
|
|
356,247
|
|
|
58,314
|
Net cash used in
investing activities
|
|
(160,922)
|
|
|
(157,762)
|
|
|
(25,824)
|
|
|
|
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Proceeds from
short-term bank loans
|
|
18,500,000
|
|
|
-
|
|
|
-
|
Repayments of
short-term bank loans
|
|
(12,870,000)
|
|
|
(2,000,000)
|
|
|
(327,380)
|
Proceeds from
short-term borrowings - related parties
|
|
-
|
|
|
12,550,000
|
|
|
2,054,312
|
Repayment of
short-term borrowings
|
|
(570,375)
|
|
|
-
|
|
|
-
|
Repayment of
short-term borrowings - related parties
|
|
(5,303,279)
|
|
|
(7,550,000)
|
|
|
(1,235,861)
|
Proceeds from sale of
common stock, net of issuance costs
|
|
12,132,882
|
|
|
-
|
|
|
-
|
Net cash provided
by financing activities
|
|
11,889,228
|
|
|
3,000,000
|
|
|
491,071
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rate fluctuation on cash and cash equivalents
|
|
68,669
|
|
|
(51,605)
|
|
|
(8,449)
|
|
|
|
|
|
|
|
|
|
Net decrease in
cash and cash equivalents
|
|
(3,486,503)
|
|
|
(13,428,717)
|
|
|
(2,198,151)
|
Cash and cash
equivalents at beginning of period
|
|
12,350,392
|
|
|
18,094,586
|
|
|
2,961,908
|
Cash and cash
equivalents at end of period
|
|
8,863,889
|
|
|
4,665,869
|
|
|
763,757
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental cash
flow information
|
|
|
|
|
|
|
|
|
Cash paid during
the period for interest
|
|
952,125
|
|
|
808,065
|
|
|
132,272
|
Cash paid during
the period for taxes
|
|
700,268
|
|
|
616,225
|
|
|
100,870
|
|
|
|
|
|
|
|
|
|
Non-cash investing
and financing activities
|
|
|
|
|
|
|
|
|
Cancellation of prior
issuance of 40,625 shares of common stock for professional
services
|
|
-
|
|
|
(1,002,721)
|
|
|
(164,136)
|
|
|
|
|
|
|
|
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/recon-technology-ltd-reports-fiscal-year-2015-third-quarter-financial-results-300084682.html
SOURCE Recon Technology, Ltd.