PR Newswire: news distribution, targeting and monitoring
Home Page > News Releases > Industry News > Recon Technology Reports Fiscal 2017 Third Quarter and First Nine Months Financial Results

Recon Technology Reports Fiscal 2017 Third Quarter and First Nine Months Financial Results

2017-05-15 20:34
Share with Twitter

Highlighted by Higher Revenues and Improved Non GAAP Results

BEIJING, May 15, 2017 /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 and first nine months of fiscal year 2017, which ended March 31, 2017.

Third Quarter FY2017 Financial Highlights (all comparable to the prior year period):

  • Total revenues for the third quarter of FY2017 increased by 30% to RMB5.9 million ($0.9 million)
  • Gross profit for the third quarter of FY2017 was RMB1.1 million ($0.2 million)
  • Gross profit margin decreased to 18.3%, largely reflecting temporary lower selling prices during this period in order to seize new market share while costs of sales remain stable.
  • Net loss attributable to Recon for the third quarter of FY2017 was RMB7.2 million ($1.0 million), or RMB0.81 ($0.12) per basic and diluted share, compared to RMB9.6 million, or RMB1.66 per basic and diluted share, for the same period of last fiscal year.
  • Non-GAAP net loss attributable to common shareholders excluding certain non-cash expenses was RMB2.1 million ($306,137), or RMB0.24 ($0.03) per basic and diluted share, for the third quarter of FY2017, compared to non-GAAP net loss attributable to common shareholders of RMB6.8 million, or RMB1.16 per basic and diluted share, for the same period last fiscal year.

First Fiscal Nine Months ended March 31, 2017 Financial Highlights (all comparable to the prior year period):

  • Total revenues for the first nine months of FY2017 increased by 19.0% to RMB44.0 million ($6.4 million)
  • Gross profit for the first nine months of FY2017 was RMB15.5 million ($2.2 million)
  • Gross profit margin improved by 13.9% to 35.2%, largely due to continued revenues generated by higher margin projects stemming from its automation projects and investments in developing its oilfield waste water treatment services as of this fiscal year
  • Net loss attributable to Recon for the first nine months of FY2017 was RMB17.0 million ($2.5 million), or RMB2.43 ($0.35) per basic and diluted share, compared to RMB21.0 million, or RMB3.75 per basic and diluted share, for the same period of last fiscal year.
  • Non-GAAP net loss attributable to common shareholders excluding certain non-cash expenses was RMB2.3 million ($340,110), or RMB0.33 ($0.05) per basic and diluted share, for the first nine months of FY2017, compared to non-GAAP net loss attributable to common shareholders of RMB15.0 million, or RMB2.68 per basic and diluted share, for the same period last fiscal year.
  • RMB3.93 ($0.57) per share in shareholders' equity per share

Management Commentary

Mr. Shenping Yin, Chairman and CEO of Recon stated, "The third quarter ended March 31, 2017 brought a number of operational achievements, such as our successful expansion into a new market in Changqing for our automation products and our development of wastewater treatment technology. We saw many encouraging signs of the industry beginning to turnaround, which allowed us to further improve our operations. Based on our current contractual agreements and partnerships, as well some positive bidding results, we remain confident in our ability to achieve our goal of a 30% increase in revenues for the fiscal year."

Results of Operations

The following consolidated results of operations include the results of operations of the Company's wholly owned subsidiaries and its variable interest entities ("VIEs"), Nanjing Recon Technology Co. Ltd ("Nanjing Recon") and Beijing BHD Petroleum Technology Co, Ltd ("BHD").

On November 25, 2016, the Company began reporting under Rule 3b-4 of the Securities Exchange Act of 1934 as a foreign private issuer, including the filing of annual reports on Form 20-F and current reports on Form 6-K. Recon has provided selected fiscal 2017 third quarter results, with greater detail on its first half financial results in this report.  

Selected Financial Highlights in RMB

(in 000s, except number of shares and per share data)

Conversion US$1.0: RMB6.89 at March 31, 2017


3 months ended
 March 31, 2016


3 months ended
March 31, 2017


9 months ended
 March 31, 2016


9 months ended
 March 31, 2017

Sales

4,539


5,898


36,975


44,013

Cost of Revenues

2,839


4,816


29,111


28,522

Gross Profit

1,700


1,082


7,864


15,491

Gross Profit Margin

37%


18%


21%


35%









Loss from Operations

(8,246)


(6,971)


(20,202)


(16,265)









Net Loss Attributable to Recon
Technology, Ltd

(9,627)


(7,187)


(20,995)


(16,999)

Non U.S. GAAP Net Loss attributable
to ordinary shareholders

(6,762)


(2,110)


(14,989)


(2,344)

Basic and Weighted Average Number
of Diluted Ordinary Shares
Outstanding (1)

5,804,005


8,926,631


5,603,229


7,006,354

Basic and Diluted Loss per Share

(1.66)


(0.81)


(3.75)


(2.43)

Non U.S. GAAP adjusted loss per
basic and diluted share

(1.16)


(0.24)


(2.68)


(0.33)

(1) Includes 3,010,000 shares that are not vested and remain subject to forfeiture in part or whole, as disclosed on a current report on Form 6-K filed December 9, 2016.

3 MONTHS ENDED MARCH 31, 2017 UNAUDITED FINANCIAL RESULTS

Revenue

Total revenues for the three months ended March 31, 2017 increased by 30% to RMB5.9 million ($0.9 million) compared to RMB4.5 million, largely due to increased sales of equipment due to more furnaces provided to the Company's new client, Changqing Oilfield, a major subsidiary of PetroChina and the largest producing oilfield of China. 

Cost and Margin

The Company's gross profit decreased by 36% to RMB1.1 million (or $0.2 million) for the three months ended March 31, 2017 from RMB1.7 million in the prior year period. Gross profit margin decreased to 18.3% from 37.5% in the prior year period. The significant decrease in gross margin was largely due to lower price furnace products sold during this period in order to seize new market share.

Net Loss

Loss from operations was RMB7.0 million ($1.0 million) during the three months ended March 31, 2017, compared to RMB8.2 million in the prior year period. The decrease in net loss is largely due to higher total revenues and lower provision for doubtful accounts, offset by higher cost of revenues, share-based compensation, as well as the research and development expenses. 

Net loss attributable to Recon Technology for the three months ended March 31, 2017 was RMB7.2 million ($1.0 million), or RMB0.81 ($0.12) per basic and diluted share based on 8.9 million basic and diluted shares outstanding, compared to RMB9.6 million, or RMB1.66 per basic and diluted share based on 5.8 million basic and diluted shares outstanding in the prior year period. 

Non U.S. GAAP Net Loss

Non U.S. GAAP net loss attributable to ordinary shareholders excluding certain non-cash expenses such as restricted shares issued for consulting services and non-cash stock compensation expense was RMB2.1 million ($306,137), or RMB0.24 ($0.03) per diluted share, for the three months ended March 31, 2017, compared to adjusted net loss attributable to common shareholders of RMB6.8 million, or RMB1.16 per basic and diluted share, for the same period last fiscal year. Please see the note about non-GAAP measures and the reconciliation table at the end of this press release.

9 MONTHS ENDED MARCH 31, 2017 UNAUDITED FINANCIAL RESULTS

Revenue


For the Nine Months Ended


March 31,






Increase  


Percentage


2016


2017




Change

Hardware and software - non-related parties

RMB

35,877,231


RMB

41,202,856


RMB

5,325,625



14.8

%

Service


1,098,258



2,809,874



1,711,616



155.8

%

Total revenues

RMB

36,975,489


RMB

44,012,730


RMB

7,037,241



19.0

%

Our total revenues for the nine months ended March 31, 2017 were approximately RMB44.0 million ($6.4 million), an increase of approximately RMB7.0 million or 19.0% from RMB37.0 million for the nine months ended March 31, 2016. The overall increase in revenue was accomplished through our expansion of new clients and development of new business. See below for more detail:


For the Nine Months Ended


March 31






Increase /


Percentage


2016


2017


(Decrease)


Change

Automation product and software

RMB

25,137,674


RMB

18,901,400


RMB

(6,236,274)


(24.8)

%

Equipment and accessories


10,739,557



22,301,456



11,561,899


107.7

%

Waste water treatment products


-



2,737,704



2,737,704


100.0

%

Other services


1,098,258



72,170



(1,026,088)


(93.4)

%

Total revenue - Hardware and software -
non-related parties

RMB

36,975,489


RMB

44,012,730


RMB

7,037,241


19.0

%

(1) As shown above, the overall increase in revenue was primarily affected by the increased sales of equipment, primarily more furnaces provided to our new client, Changqing Oilfield, a major subsidiary of PetroChina and the largest producing oilfield of China.

(2) The Company invested in R&D of new products used for oilfield waste water treatment beginning in 2016, and the outcome was gradually reflected its operating results. For the nine months ended March 31, 2017, this new business continued to contribute revenue and margin to our operation. Management expects to obtain more business in the coming months due to our technical advantage and long-term cooperation with oilfield companies.

(3) Revenue from other services decreased by RMB1.0 million or 93.4% mainly because we provided furnace maintenance services as required by clients in FY2016 while there was no such requirement during the same period of FY2017.

Cost and Margin


For the Nine Months Ended


March 31,






Increase /


Percentage


2016


2017


(Decrease)


Change

Total revenues

RMB

36,975,489


RMB

44,012,730


RMB

7,037,241



19.0

%

Cost of revenues


29,111,166



28,522,003



(589,163)



(2.0)

%

Gross profit

RMB

7,864,323


RMB

15,490,727


RMB

7,626,404



97.0

%

Margin %


21.3

%


35.2

%


13.9

%


-


Cost of Revenues. Our cost of revenues decreased from approximately RMB29.1 million for the nine months ended March 31, 2016 to approximately RMB28.5 million ($4.1 million) for the same period in 2017, a decrease of approximately RMB0.6 million ($85,496), or 2.0%. This decrease was mainly caused by less revenue generated from automation products and software which has higher cost of revenue.

Gross Profit. Our gross profit increased to approximately RMB15.5 million ($2.2 million) for the nine months ended March 31, 2017 from approximately RMB7.9 million for the same period in 2016. Our gross profit as a percentage of revenue increased to 35.2% for the nine months ended March 31, 2017 from 21.3% for the same period in 2016. This was mainly due to higher margin automation projects and waste water treatment business during this period.

Operating Expenses


For the Nine Months Ended


March 31,






Increase /


Percentage


2016


2017


(Decrease)


Change

Selling and distribution expenses

RMB

3,443,464


RMB

5,111,070


RMB

1,667,606



48.4

%

  % of revenue


9.3

%


11.6

%


2.3



-


General and administrative expenses


14,531,491



20,973,292



6,441,801



44.3

%

  % of revenue


39.3

%


47.6

%


8.3



-


Provision for (reversal of) doubtful
accounts 


4,334,148



(876,530)



(5,210,678)



(120.2)

%

  % of revenue


11.7

%


(2.0)

%


(13.7)



-


Research and development expenses


5,757,141



6,547,582



790,441



13.7

%

  % of revenue


15.6

%


14.9

%


(0.7)



-


Operating expenses

RMB

28,066,244


RMB

31,755,414


RMB

3,689,170



13.1

%

Selling and Distribution Expenses.  Selling and distribution expenses consist primarily of salaries and related expenditures of our sales and marketing organization, sales commissions, costs of our marketing programs including traveling charges, advertising and trade shows, and an allocation of our facilities, depreciation expenses and rental expense, as well as shipping charges. Selling expenses increased by approximately RMB1.7 million ($0.2 million) for the nine months ended March 31, 2017 compared to the same period in 2016. This increase was primarily due to an increase in onsite projects service expenses as a result of projects increase. Selling expenses were 11.6% of total revenues for the nine months ended march 31, 2017 and 9.3% of total revenues in the same period of 2016.

General and Administrative Expenses. General and administrative expenses consist primarily of costs in human resources, facilities costs, depreciation expenses, professional advisor fees, audit fees, stock based compensation expense and other miscellaneous expenses incurred in connection with general operations. General and administrative expenses increased by 44.3% or RMB6.4 million ($0.9 million), from approximately RMB14.5 million in the nine months ended March 31, 2016 to approximately RMB21.0 million ($3.0 million) in the same period of 2017. The increase in general and administrative expenses was mainly due to an increase in salaries and share-based compensation. General and administrative expenses were 47.6% of total revenues in the nine months ended March 31, 2017 and 39.3% of total revenues in the same period of 2016.

Provision for doubtful accounts. Provision for doubtful accounts is the estimated amount of bad debt that will arise from accounts receivables, other receivables and purchase advances. We recorded a provision for doubtful accounts of RMB4.3 million for nine months ended March 31, 2016 and reversed provision for doubtful accounts of RMB0.9 million ($127,196) for the same period in 2017. The decrease in provision of doubtful accounts was mainly resulted by the management's effort to collect the long outstanding receivables.  

Research and development ("R&D") expenses.  Research and development expenses consist primarily of salaries and related expenditures for our research and development projects. Research and development expenses increased from approximately RMB5.8 million for the nine months ended March 31, 2016 to approximately RMB6.5 million ($1.0 million) for the same period of 2017. This increase was primarily due to more research and development expense spent on design of chemical products used for waste water treatment and digital oilfield models and platform.

Net Loss


For the Nine Months Ended


March 31,






Increase /


Percentage


2016


2017


(Decrease)


Change

Loss from operations

RMB

(20,201,921)


RMB

(16,264,687)


RMB

3,937,234



19.5

%

Interest and other expense


(248,489)



(185,591)



62,898



25.3

%

Loss before income taxes


(20,450,410)



(16,450,278)



4,000,132



19.6

%

Provision for income taxes


544,772



264,344



(280,428)



(51.5)

%

Net loss


(20,995,182)



(16,714,622)



4,280,560



20.4

%

Less: Net income attributable to non-
controlling interest


-



284,649



284,649



100.0

%

Net loss attributable to Recon
Technology, Ltd

RMB

(20,995,182)


RMB

(16,999,271)


RMB

3,995,911



19.0

%

Loss from operations.  Loss from operations was approximately RMB16.3 million ($2.4 million) for the nine months ended March 31, 2017, compared to a loss of RMB20.2 million for the same period of 2016. This RMB3.9 million ($0.6 million) decrease in loss from operations was primary due to an increase in gross profit, as well as a decrease in provision for doubtful accounts and partly offset by an increased general and administrative expenses as discussed above.

Basic and diluted loss per share. Basic and diluted loss per share attributable to common shareholders was RMB2.43, as compared to RMB3.75, for the nine months ended March 31, 2016.

Non U.S. GAAP Net Loss

Non U.S. GAAP net loss attributable to ordinary shareholders excluding certain non-cash expenses (non-GAAP) such as restricted shares issued for consulting services and non-cash stock compensation expense was RMB2,343,740 ($340,110), or RMB 0.33 ($0.05) per diluted share, for the nine months ended March 31, 2017, compared to non U.S. GAAP net loss attributable to common shareholders of RMB15.0 million, or RMB2.68 per diluted share, for the same period last fiscal year. Please see the note about non-GAAP measures and the reconciliation table at the end of this press release.

LIQUIDITY AND CAPITAL RESOURCES

Selected Balance Sheet Highlights in RMB

Conversion US$1.0: RMB6.89 at March 31, 2017


3/31/2017


6/30/2016

Percentage

Change





Cash and Cash Equivalents

4,334,610


1,817,620

138.48

%

Total Current Assets

72,161,271


74,322,220

(2.91)

%

Total Assets

74,779,306


79,450,314

(5.88)

%

Working Capital

44,814,662


44,471,702

0.77

%

Total Liabilities (No Long-Term Debt)

27,346,609


29,850,518

(8.39)

%

Shareholders' Equity

38,924,551


41,376,299

(5.93)

%

Total Liabilities and Shareholders' Equity

74,779,306


79,450,314

(5.88)

%

Cash from Operating Activities. Net cash provided by operating activities was approximately RMB9.1 million ($1.3 million) for the nine months ended March 31, 2017. This was an increase of approximately RMB10.4 million ($1.5 million) compared to net cash used in operating activities of approximately RMB1.3 million for the nine months ended March 31, 2016. The increase in net cash provided by operating activities for the nine months ended March 31, 2017 was primarily attributable to the net loss available to the Company in the amount of RMB16.7 million ($2.4 million), share based compensation of RMB11.4 million ($1.6 million) and restricted shares issued for services of RMB3.9 million ($0.6 million) as reconciled, and collections of other receivable, an increase in trade accounts payable and a decrease in inventory, partly offset by an increase in purchase advance.

Cash from Investing Activities. Net cash used in investing activities was approximately RMB0.3 million ($44.0 thousand) for the nine months ended March 31, 2017, which was a decrease in cash used in investing activities of approximately RMB0.1 million compared to the same period in 2016. The decrease is due to a decrease in the Company's purchase of additional property and equipment.

Cash from Financing Activities. Net cash used in financing activities amounted to RMB6.2 million ($0.9 million) for the nine months ended March 31, 2017, as compared to net cash used in financing activities of $8.1 million for the same period in 2016. During the nine months ended March 31, 2017, we repaid RMB13.4 million ($1.9 million) in short-term borrowings to two related parties and repaid RMB0.5million ($76.9 thousand) in short-term borrowings to one third-party, and we received RMB7.8 million ($1.1 million) from two related parties.

STATEMENT REGARDING UNAUDITED FINANCIAL INFORMATION

The unaudited financial information set forth above is subject to adjustments that may be identified when audit work is performed on the Company's year-end financial statements, which could result in significant differences from this unaudited financial information.

Use of Non -GAAP Financial Measures

To supplement Recon's consolidated financial information presented in accordance with U.S. generally accepted accounting principles ("GAAP"), Recon uses the following non-GAAP financial measures: certain non-cash expenses such as restricted shares issued for consulting services and non-cash stock compensation expense, basic and diluted earnings (losses) per common share excludes non-cash expenses such as restricted shares issued for consulting services and non-cash stock compensation expense.

The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Recon believes these non-GAAP financial measures provide meaningful supplemental information about its performance by excluding non-cash items, which may not be indicative of its operating performance.

About Recon Technology, Ltd. (NASDAQ: RCON)

Recon Technology, Ltd. is China's first listed non-state owned oil and gas field service company on NASDAQ. Recon supplies China's largest oil exploration companies, Sinopec (NYSE: 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. Through the years, RCON has taken leading positions on several segmented markets of the oil and gas filed service industry. RCON also has developed stable long-term cooperation relationship with its major clients, and its products and service are also well accepted by clients. For additional information please visit us at www.recon.cn.

Currency Conversion

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 RMB6.89 to US$1.00, the noon buying rate as of March 31, 2017 as set forth in the H.10 statistical release of the Federal Reserve Board. Prior period numbers have been recast into the new reporting currency.

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.

Company Contact

Liu Jia
Recon Technology, Ltd.
+86 (10) 84945799
info@recon.cn

Investor Relations

The Equity Group Inc.
In China
Katherine Yao, Senior Associate
+86-10-6587-6435
kyao@equityny.com

In U.S.
Adam Prior, Senior Vice President
+1 (212) 836-9606
aprior@equityny.com

 

 

RECON TECHNOLOGY, LTD

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)



As of June 30,


As of March 31,


As of March 31,


2016


2017


2017

ASSETS

RMB


RMB


U.S. Dollars

Current assets









Cash

RMB

1,817,620


RMB

4,334,610


$

629,011

Notes receivable


4,660,177



6,901,356



1,001,480

Trade accounts receivable, net 


38,097,626



38,215,853



5,545,638

Inventories, net


6,313,070



2,998,273



435,090

Other receivables, net 


22,000,112



12,862,240



1,866,485

Purchase advances, net


1,323,305



6,676,554



968,858

Prepaid expenses 


110,310



172,385



25,015

Total current assets


74,322,220



72,161,271



10,471,577










Property and equipment, net


2,907,762



2,618,035



379,912

Long-term trade accounts receivable, net


2,220,332



-



-

Total Assets

RMB

79,450,314


RMB

74,779,306


$

10,851,489



















Current liabilities









Trade accounts payable

RMB

7,540,430


RMB

11,025,579


$

1,599,961

Other payables 


2,972,192



2,113,520



306,700

Other payable- related parties


3,680,244



3,449,920



500,630

Deferred revenue


406,681



447,070



64,876

Advances from customers


200,600



231,600



33,608

Accrued payroll and employees' welfare


381,109



1,687,427



244,869

Accrued expenses


261,348



193,274



28,043

Taxes payable


755,880



673,806



97,778

Short-term borrowings


530,000



-



-

Short-term borrowings - related parties


12,941,848



7,344,227



1,065,747

Deferred tax liability


180,186



180,186



26,147

Total current liabilities


29,850,518



27,346,609



3,968,359










Equity









Common stock, ($ 0.0185 U.S. dollar par value,
100,000,000 shares authorized; 9,902,914 and 5,804,005
shares issued and outstanding as of March 31, 2017 and
June 30, 2016, respectively)


741,467



1,261,823



183,108

Additional paid-in capital


100,612,455



114,747,630



16,651,437

Statutory reserve


4,148,929



4,148,929



602,066

Accumulated deficits


(63,907,512)



(80,906,783)



(11,740,671)

Accumulated other comprehensive loss


(219,040)



(327,048)



(47,458)

Total shareholders' equity


41,376,299



38,924,551



5,648,482

Non-controlling interest


8,223,497



8,508,146



1,234,647

Total equity


49,599,796



47,432,697



6,883,129

Total Liabilities and Equity

RMB

79,450,314


RMB

74,779,306


$

10,851,488

 

 

RECON TECHNOLOGY, LTD

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(UNAUDITED)



For the nine months ended


For the three months ended


March 31,


March 31,


2016


2017


2017


2016


2017


2017


RMB


RMB


USD


RMB


RMB


USD



















Revenues


















Hardware and software

RMB

35,877,231


RMB

41,202,856


$

5,979,093


RMB

4,539,099


RMB

5,897,622


$

855,825

Service


1,098,258



2,809,874



407,751



-



-



-

Total revenues


36,975,489



44,012,730



6,386,844



4,539,099



5,897,622



855,825



















Cost of revenues


















Hardware and software


28,434,196



26,489,931



3,844,049



2,839,120



4,816,497



698,939

Service


676,970



2,032,072



294,881



-



-



-

Total cost of revenues


29,111,166



28,522,003



4,138,930



2,839,120



4,816,497



698,939

Gross profit


7,864,323



15,490,727



2,247,914



1,699,979



1,081,125



156,886





































Selling and distribution expenses


3,443,464



5,111,070



741,686



819,116



915,981



132,921

General and administrative expenses


14,531,491



20,973,292



3,043,509



5,718,046



5,728,585



831,295

Provision for doubtful accounts  


4,334,148



(876,530)



(127,196)



2,180,811



(185,566)



(26,928)

Research and development expenses


5,757,141



6,547,582



950,143



1,228,105



1,592,780



231,134

Operating expenses


28,066,244



31,755,414



4,608,142



9,946,078



8,051,780



1,168,422





































Loss from operations


(20,201,921)



(16,264,687)



(2,360,228)



(8,246,099)



(6,970,655)



(1,011,536)



















Other income (expenses)


















Subsidy income


289,087



96,905



14,062



164,367



89,098



12,929

Interest income


147,092



65,776



9,545



42,373



16,798



2,438

Interest expense


(672,789)



(423,875)



(61,510)



(198,589)



(138,013)



(20,028)

Income (loss) from foreign currency exchange


(21,032)



22,603



3,280



(20,830)



19,588



2,842

Other income (expense) 


9,153



53,000



7,691



44,323



(10,524)



(1,527)

Other income (expense)


(248,489)



(185,591)



(26,932)



31,644



(23,053)



(3,346)

Loss before income tax


(20,450,410)



(16,450,278)



(2,387,160)



(8,214,455)



(6,993,708)



(1,014,882)

Income tax expenses


544,772



264,344



38,360



1,412,945



284,487



41,283

Net loss


(20,995,182)



(16,714,622)



(2,425,520)



(9,627,400)



(7,278,195)



(1,056,165)















-



-

Less: Net income(loss) attributable to non-
controlling interest


-



284,649



41,306



-



(91,563)



(13,287)

Net loss attributable to Recon
Technology, Ltd

RMB

(20,995,182)


 RMB

(16,999,271)


$

(2,466,826)


 RMB

(9,627,400)


 RMB

(7,186,632)


$

(1,042,878)



















Comprehensive loss


















Net loss


(20,995,182)



(16,714,622)



(2,425,520)



(9,627,400)



(7,278,195)



(1,056,165)

Foreign currency translation adjustment


63,400



(108,008)



(15,673)



(59,390)



(33,856)



(4,913)

Comprehensive loss


(20,931,782)



(16,822,630)



(2,441,193)



(9,686,790)



(7,312,051)



(1,061,078)

Less: Comprehensive income (loss)
attributable to non-controlling interest


7,044



284,649



41,306



(6,599)



(91,563)



(13,287)

Comprehensive loss attributable to
Recon Technology, Ltd

RMB

(20,938,826)


 RMB

(17,107,279)


$

(2,482,499)


 RMB

(9,680,191)


 RMB

(7,220,488)


$

(1,047,791)



















Loss per common share - basic and
diluted

RMB

(3.75)


RMB

(2.43)


$

(0.35)


RMB

(1.66)


RMB

(0.81)


$

(0.12)

Weighted - average shares -basic
and diluted


5,603,229



7,006,354



7,006,354



5,804,005



8,926,631



8,926,631

 

 

RECON TECHNOLOGY, LTD 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 

(UNAUDITED)











For the nine months ended March 31,


2016


2017


2017


RMB


RMB


U.S. Dollars










Cash flows from operating activities:









Net loss

RMB

(20,995,182)


RMB

(16,714,622)


$

(2,425,520)

Adjustments to reconcile net loss to net cash provided by
operating activities:









Depreciation


728,092



636,072



92,303

Gain from disposal of  equipment


(40,688)



(35,919)



(5,212)

Provision for (recovery of) doubtful accounts


4,334,148



(876,530)



(127,196)

Reversal of slow moving inventories


(95,122)



-



-

Share based compensation


4,134,042



11,361,034



1,648,640

Deferred tax provision


1,742,098



-



-

Restricted shares issued for services


1,871,722



3,294,497



478,076

Changes in operating assets and liabilities:









Notes receivable


2,706,820



(2,241,179)



(325,225)

Trade accounts receivable


5,705,680



2,554,495



370,692

Trade accounts receivable-related parties


4,569,800



-



-

Inventories


503,627



3,314,798



481,022

Other receivable, net


(2,566,250)



9,652,913



1,400,768

Other receivables-related parties, net


91,021



-



-

Purchase advance, net


4,361,022



(5,458,035)



(792,035)

Purchase advance-related parties, net


394,034



-



-

Prepaid expense


629,622



(62,074)



(9,008)

Prepaid expense - related parties, net


(210,000)



-



-

Trade accounts payable


(6,981,485)



3,485,149



505,742

Other payables


820,214



(858,672)



(124,605)

Other payables-related parties


(659,373)



(230,324)



(33,423)

Deferred revenue


(1,981,194)



40,389



5,861

Advances from customers


(143,406)



31,000



4,499

Accrued payroll and employees' welfare


82,028



1,306,318



189,564

Accrued expenses


67,803



(14,851)



(2,155)

Taxes payable


(357,116)



(89,615)



(13,004)

Net cash provided by (used in) operating activities


(1,288,043)



9,094,844



1,319,784










Cash flows from investing activities:









Purchases of property and equipment


(502,658)



(354,784)



(51,484)

Proceeds from disposal of equipment


60,000



51,900



7,531

Net cash used in investing activities


(442,658)



(302,884)



(43,953)










Cash flows from financing activities:









Proceeds from short-term bank loans


500,000



-



-

Repayments of short-term bank loans


(500,000)



-



-

Repayment of  short-term borrowings


-



(530,000)



(76,910)

Proceeds from short-term borrowings-related parties


8,525,400



7,758,318



1,125,837

Repayment of short-term borrowings-related parties


(16,748,394)



(13,409,163)



(1,945,851)

Proceeds from sale of common stock, net of issuance costs


168,319



-



-

Net cash used in financing activities


(8,054,675)



(6,180,845)



(896,924)










Effect of exchange rate fluctuation on cash and cash equivalents


60,390



(94,125)



(13,657)










Net increase (decrease) in cash


(9,724,986)



2,516,990



365,250

Cash at beginning of period


12,344,929



1,817,620



263,761

Cas at end of period

RMB

2,619,943


RMB

4,334,610


$

629,011










Supplemental cash flow information









Cash paid during the period for interest

RMB

672,789


RMB

454,414


$

65,942

Cash paid during the period for taxes

RMB

142,477


RMB

284,487


$

41,283










Non-cash investing and financing activities









Issuance of common stock to prepay professional services

RMB

2,265,442


RMB

3,294,497


$

478,076

Non-cash transaction for AR and short-term borrowings-related parties offset

RMB

200,000


RMB

-


$

-

 

 

Reconciliation of Non-GAAP Financial Measures



For the three months ended


March 31,


2016


2017


2017


RMB


RMB


USD

Reconciliation of Net loss attributable to common
shareholders









to Adjusted Net loss attributable to common shareholders









     Net loss attributable to common shareholders

RMB

(9,627,400)


RMB

(7,186,632)


$

(1,042,878)

Special items (A):









     Restricted shares issued for consulting services


1,305,361



2,530,110



367,153

     Stock compensation expense


1,560,467



2,546,885



369,588

Adjusted net loss attributable to common shareholders

RMB

(6,761,572)


RMB

(2,109,637)


$

(306,137)










Reconciliation of U.S. GAAP Loss Per Share









to Non U.S. GAAP Adjusted Loss Per Share









U.S. GAAP loss per share









  Basic and diluted

RMB

(1.66)


RMB

(0.81)


$

(0.12)

Impact of special items on earnings per share









Basic and diluted


0.50



0.57



0.09

Non U.S. GAAP adjusted loss per share









Basic and diluted

RMB

(1.16)


RMB

(0.24)


$

(0.03)

Weighted - average shares – basic and diluted


5,804,005



8,926,631



8,926,631











For the nine months ended


March 31,


2016


2017


2017


RMB


RMB


USD

Reconciliation of Net loss attributable to common
shareholders









to Adjusted Net loss attributable to common shareholders









     Net loss attributable to common shareholders

RMB

(20,995,182)


RMB

(16,999,271)


$

(2,466,826)

Special items (A):









     Restricted shares issued for consulting services


1,871,722



3,294,497



478,076

     Stock compensation expense


4,134,042



11,361,034



1,648,640

Adjusted net loss attributable to common shareholders

RMB

(14,989,418)


RMB

(2,343,740)


$

(340,110)










Reconciliation of U.S. GAAP Loss Per Share









to Non U.S. GAAP Adjusted Loss Per Share









U.S. GAAP loss per share

RMB

(3.75)


RMB

(2.43)


$

(0.35)

Impact of special items on earnings per share


1.07



2.10



0.30

Non U.S. GAAP adjusted loss per share

RMB

(2.68)


RMB

(0.33)


$

(0.05)

Weighted - average shares – basic and diluted


5,603,229



7,006,354



7,006,354

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/recon-technology-reports-fiscal-2017-third-quarter-and-first-nine-months-financial-results-300457409.html

Source: Recon Technology, Ltd.

Related stocks: NASDAQ-SMALL:RCON

Related Links:

Featured Video

Banking/Financial Service Recent Releases

Computer Software Recent Releases

Computer/Electronics Recent Releases

Machine Tools, Metalworking and metallurgy Recent Releases

Oil/Energy Recent Releases

Earnings Recent Releases

Earnings projections or forecasts Recent Releases

Advanced Search
Search
  
  1. Products & Services
  2. News Releases
  3. Knowledge Center
  4. For Journalists & Media
  5. Multimedia Theater
  6. Contact Us