Ionix Technology, Inc. Announces First Quarter 2020 Financial Results

2019-11-15 02:35 6142

LAS VEGAS, Nov. 15, 2019 /PRNewswire/ -- Ionix Technology, Inc. (OTCQB: IINX), ("Ionix Technology", "IINX" or "the Company"), a business aggregator in photoelectric display and smart energy fields, announced its financial results for the three months ended September 30, 2019.

First Quarter 2020 Financial Highlights:

Total revenues increased by 192 % from the three months ended September 30, 2018 to three months ended September 30, 2019.
Gross profit increased by 394% from the three months ended September 30, 2018 to three months ended September 30, 2019.
Net income increased by 302% from the three months ended September 30, 2018 to three months ended September 30, 2019.
Gross profit margin maintained at 19.0% during the three months ended September 30, 2019 as compared to 11.3% for the three months ended September 30, 2018.

"The fiscal year 2020 is off to a good start. With another strong quarter of operations, Ionix Technology is building a solid track record of execution," said Mr. Cheng Li, Chairman of Ionix Technology. "The first quarter performance speaks to our differentiated market position, as we invest continuously in innovation to create compelling solutions for our customers."

Mr. Li continued, "With a broad and growing product portfolio, Ionix Technology remains well-positioned to benefit from the long-term growth of the photoelectric display industry."

Revenue

During the three months ended September 30, 2019 and 2018, total revenues was $7,500,330 and $2,568,888, respectively. The total revenues increased by 192 % from the three months ended September 30, 2018 to three months ended September 30, 2019.

The increase in revenues for the three months ended September 30, 2019 compared to 2018 can be attributed to our expanded operations in the fields of LCM in the PRC by the acquisition of Fangguan Electronics on December 27, 2018.

Cost of Revenue

During the three months ended September 30, 2019 and 2018, the total cost of revenue was $6,073,104 and $2,279,723, respectively. The total cost of revenues increased by 166% from the three months ended September 30, 2018 to three months ended September 30, 2019.

The increase in cost of revenue for the three months ended September 30, 2019 compared to 2018 was attributed to additional revenue from operations in the fields of LCM in the PRC by the acquisition of Fangguan Electronics on December 27, 2018.

Gross Profit

During the three months ended September 30, 2019 and 2018, the gross profit was $1,427,226 and $289,165 respectively. The gross profit increased by 394% from the three months ended September 30, 2018 to three months ended September 30, 2019. Gross profit margin maintained at 19.0% during the three months ended September 30, 2019 as compared to 11.3% for the three months ended September 30, 2018.

The difference can be attributed to the fact that the LCM manufactured and sold by Fangguan Electronics (which became a variable interest entity of the Company on December 27, 2018) hold the higher gross margin (around 17%).

Selling, General and Administrative Expenses

During the three months ended September 30, 2019 and 2018, selling, general and administrative expenses were $381,428 and $61,586, respectively.

The difference can be attributed to the depreciation and amortization expenses, payroll expenses, professional fees and other expenses incurred during the three months ended September 30, 2019 after Fangguan Electronics became a variable interest entity of the Company on December 27, 2018.

Research and Development Expenses

During the three months ended September 30, 2019 and 2018, research and development expenses were $222,823 and $0, respectively.

The difference can be attributed to the research and development expenses incurred during the three months ended September 30, 2019 after Fangguan Electronics became a variable interest entity of the Company on December 27, 2018.

Net Income

During the three months ended September 30, 2019 and 2018, net income was $711,276 compared with $177,153 respectively.

The difference can be attributed to increase in gross profits netting off by the increase of expenses during the three months ended September 30, 2019.

Cash and Financial Position

As of September 30, 2019, the Company had cash and cash equivalents of $ 1,900,785, compared to $ 509,615 as of June 30, 2019.

The Company had a working capital of $ 1,504,464 as of September 30, 2019 compared to working capital of $717,977 as of June 30, 2019.

During the three months ended September 30, 2019 and 2018, net cash provided by operating activities was $1,217,629 and $ 57,609, respectively. The change was mainly due to the increase in the net income, increased net cash flows from operating assets and liabilities of $370,051 and an increase resulting from adjustments to net income for non-cash items, which increased $255,846 in 2019 compared to 2018.

During the three months ended September 30, 2019 and 2018, net cash used in investing activities was $118,198 and $0 respectively. The change was mainly due to the cash used in the acquisition of the equipment.

During the three months ended September 30, 2019, the Company was provided by $334,455 in cash by financing activities, which was due to the repayment of loans from related parties and increase in notes receivable and convertible notes payables inflows. During the three months ended September 30, 2018, the Company was provided by $137,292 in cash for financing activities, all of which was attributable to the advances of the related party loans.

About Ionix Technology, Inc.

Ionix Technology, Inc. is a holding company that is principally engaged in the photoelectric display and smart energy industries. The company has five operating subsidiaries: Changchun Fangguan Electronics Technology Co., Ltd, a company which has been focusing on R&D, manufacturing and marketing LCM and LCD. Changchun Fangguan Photoelectric Display Technology Co., Ltd, a company which specializes in developing, designing, and selling TN and STN LCD, STN, CSTN, and TFT LCD modules as well as other related products; Shenzhen Baileqi Electronic Technology Co., Ltd, a company which specializes in LCD slicing, filling, researching and designing, and selling of LCD Modules (LCM) and PCBs; Lisite Science Technology (Shenzhen) Co., Ltd., a company engaged in the marketing and selling of intelligent electronic devices; and Dalian Shizhe New Energy Technology Co., Ltd., a company engaged in the new energy support service, and operating the photovoltaic power generation, electric vehicles and charging piles with corresponding operation and maintenance and three dimensional parking. Currently, IINX has embarked on the layout of industrialization and marketization of front end materials and back end modules of liquid crystal displays and applications of flexible folding display technology by taking Fangguan Electronics as production bases, to seize the market share of OLED high technology.

To learn more, please visit our website: www.theiinx.com

Safe Harbor Statement

This news release contains "forward-looking statements" as that term is defined in the United States Securities Act of 1933, as amended and the Securities Exchange Act of 1934, as amended. Statements in this press release that are not purely historical are forward-looking statements, including beliefs, plans, expectations or intentions regarding the future, and results of new business opportunities. Actual results could differ from those projected in any forward-looking statements due to numerous factors, such as the inherent uncertainties associated with new business opportunities and development stage companies. Ionix Technology assumes no obligation to update the forward-looking statements. Although Ionix Technology believes that any beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance that they will prove to be accurate. Investors should refer to the risk factors disclosure outlined in Ionix Technology's annual report on Form 10-K for the most recent fiscal year, quarterly reports on Form 10-Q and other periodic reports filed from time-to-time with the U.S. Securities and Exchange Commission.

IR Contact:
Dragon Gate Investment Partners
LLC Tel: +1(646)-801-2803
Email: iinx@dgipl.com

IONIX TECHNOLOGY, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)

	September 30, 2019	June 30, 2019
ASSETS Current Assets:
Cash and cash equivalents	$ 1,900,785	$ 509,615
Notes receivable	8,180	120,182
Accounts receivable - non-related parties	4,429,747	3,639,030
- related parties	102,680	340,026
Inventory	2,921,462	3,379,146
Advances to suppliers - non-related parties	358,612	129,423
- related parties	246,249	269,498
Prepaid expenses and other current assets	226,847	269,495
Total Current Assets	10,194,562	8,656,415

Property, plant and equipment, net	7,139,961	7,508,637
Intangible assets, net	1,432,017	1,496,399
Deferred tax assets	15,445	54,361
Total Assets	$ 18,781,985	$ 17,715,812

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Short-term bank loan	$ 2,518,081	$ 2,618,296
Accounts payable	3,297,564	2,732,327
Advance from customers	328,514	114,158
Convertible notes payable, net of debt discount and loan cost	69,503	-
Derivative liability	154,239	-
Due to related parties	2,035,995	2,105,338
Accrued expenses and other current liabilities	286,202	368,319
Total Current Liabilities	8,690,098	7,938,438

COMMITMENT AND CONTINGENCIES

Stockholders' Equity:
Preferred stock, $.0001 par value, 5,000,000 shares authorized, 5,000,000 shares issued and outstanding	500	500
Common stock, $.0001 par value, 195,000,000 shares authorized, 114,003,000 shares issued and outstanding	11,400	11,400
Additional paid in capital	8,849,509	8,829,487
Retained earnings	1,251,142	539,866
Accumulated other comprehensive loss	(462,625)	(45,840)
Total Stockholders' Equity attributable to the Company	9,649,926	9,335,413
Noncontrolling interest	441,961	441,961
Total Stockholders' Equity	10,091,887	9,777,374
Total Liabilities and Stockholders' Equity	$ 18,781,985	$ 17,715,812

IONIX TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)

	For the Three Months Ended September 30,

	2019	2018

Revenues	$7,500,330	$2,568,888

Cost of Revenues	6,073,104	2,279,723

Gross profit	1,427,226	289,165
Operating expenses
Selling, general and administrative expense	381,428	61,586
Research and development expense	222,823	-
Total operating expenses	604,251	61,586

Income from operations	822,975	227,579

Other income (expense):
Interest expense, net of interest income	(56,863)	-
Subsidy income	42,787	-
Change in fair value of derivative liability	15,889	-
Total other income	1,813	-

Income before income tax provision	824,788	227,579
Income tax provision	113,512	50,426
Net income	711,276	177,153

Other comprehensive income (loss)
Foreign currency translation adjustment	(416,785)	(7,922)
Comprehensive income	$294,491	$169,231

Income Per Share - Basic and Diluted	$0.01	$0.00
Weighted average number of common shares outstanding - Basic and Diluted	114,003,000	99,003,000

IONIX TECHNOLOGY, INC
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

		For the Three Months Ended June 30,

		2019		2018
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	711,276	$	177,153
Adjustments required to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization		208,314		-
Deferred taxes		37,553		(4,555)
Change in fair value of derivative liability		(15,889)		-
Amortization of debt discount		21,313		-
Changes in operating assets and liabilities:
Accounts receivable - non-related parties		(948,146)		165,960
Accounts receivable - related parties		228,709		118,902
Inventory		334,753		(284,534)
Advances to suppliers - non-related parties		(238,711)		878
Advances to suppliers - related parties		13,186		(64,737)
Prepaid expenses and other current assets		33,140		(9,530)
Accounts payable - non-related parties		682,885		(151,889)
Accounts payable - related parties		-		154,452
Advance from customers		222,994		(24,927)
Accrued expenses and other current liabilities		(73,748)		(19,564)
Net cash provided by operating activities		1,217,629		57,609

CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property, plant and equipment		(118,198)		-
Net cash used in investing activities		(118,198)		-

CASH FLOWS FROM FINANCING ACTIVITIES
Notes receivable		109,498		-
Proceeds from issuance of convertible notes payable		238,340		-
Proceeds from (repayment of) loans from related parties		(13,383)		137,292
Net cash provided by financing activities		334,455		137,292

Effect of exchange rate changes on cash		(42,716)		(1,780)

Net increase in cash and cash equivalents		1,391,170		193,121

Cash and cash equivalents, beginning of period		509,615		111,462

Cash and cash equivalents, end of period		$1,900,785		$304,583

Supplemental disclosure of cash flow information:
Cash paid for income tax		$35,312		$70,558
Cash paid for interests		$34,247		$ -