Highlighted by Increased Revenues and High Net Worth Clientele
BEIJING, June 20, 2019 /PRNewswire/ -- Puhui Wealth Investment Management Co., Ltd. (Nasdaq: PHCF) ("Puhui" or the "Company"), a third-party wealth management service provider with a focus on wealth management services for high net worth ("HNW") individuals and corporate clients, today announced its financial results for the six months ended December 31, 2018. The Company also filed these results on Form 6-K with the Securities and Exchange Commission, which can be viewed at www.sec.gov. All amounts in this press release are in USD unless otherwise noted.
Financial and Operating Highlights
Mr. Zhe Ji, the Chairman and CEO of the Company, stated, "Puhui had an excellent end to the year in both servicing a higher number of high net worth clientele while also increasing revenues. While our December 31, 2018 financial results were impacted by higher expenses and time devoted to the completion of our December 2018 IPO and listing on Nasdaq, we have seen our brand recognition and clientele increase substantially since this period. Our Company offers a diversified array of products for individuals seeking alternative means for enhancing investment returns."
Mr. Ji continued, "We have been very pleased with our initial performance since our public listing, and feel that there is considerable upside for Puhui to take advantage of China's growing wealth management market. We opened sales and service offices in three new locations since beginning of 2019 and are actively looking to expand our network by opening new sales and service offices throughout China in strategic locations that are leading industrial and business development centers throughout the country. While our intended acquisition of a Hong Kong based financial services company has entered into its late stage pending final approval, we are continuing to seek new acquisition opportunities to broaden our geographic reach outside of mainland China, including but not limited to asset management businesses and businesses with alternative strategies."
Financial Review for the Six Months Ended December 31, 2018
Selected Financial Highlights
For the Six Months Ended |
For the Six Months Ended |
Change |
Change (%) |
|||||||||||||
(Unaudited) |
(Unaudited) |
|||||||||||||||
Total Revenues |
$ |
1,866,970 |
$ |
752,495 |
$ |
1,114,475 |
148.1 |
% |
||||||||
Cost of revenues |
206,881 |
122,452 |
84,429 |
68.9 |
% |
|||||||||||
Selling expenses |
922,693 |
731,268 |
191,425 |
26.2 |
% |
|||||||||||
General and administrative expenses |
1,392,919 |
1,177,407 |
215,512 |
18.3 |
% |
|||||||||||
Loss from operations |
(655,523) |
(1,278,632) |
623,109 |
(48.7) |
% |
|||||||||||
Loss before income taxes |
(718,605) |
(1,293,719) |
575,114 |
(44.5) |
% |
|||||||||||
Provision for current income taxes |
- |
19,261 |
(19,261) |
(100.0) |
% |
|||||||||||
Provision (benefit) for deferred income taxes |
27,410 |
(284,826) |
312,236 |
(109.6) |
% |
|||||||||||
Net loss |
(746,015) |
(1,028,154) |
282,139 |
(27.4) |
% |
|||||||||||
Wealth Management
Asset Management
Revenues
Cost of Revenues
Operating Expense
Net Loss
Net loss for the six month period ended December 31, 2018 was reduced to $746,015, as compared to $1,028,154 for the six month period ended December 31, 2017.
Liquidity and Capital Resources
Cash
About Puhui Wealth Investment Management Co., Ltd.
Headquartered in Beijing, China, engaging its operation through its subsidiary, Puhui Finance Investment Management (Beijing) Co., Ltd,which is a third-party wealth management service provider focusing on marketing financial products (including private equity and other diversified products and services) to, and managing funds for, individuals and corporate clients in the PRC. On December 27, 2018, the Company's ordinary shares were listed and began trading listed on the Nasdaq Capital Market (ticker: PHCF).
Additional information about Puhui can be found at the Company's corporate website: www.puhuiwealth.com.
Forward Looking Statements
This news release contains "forward-looking statements" within the meaning of the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "anticipate", "believe", "expect", "estimate", "plan", "outlook", and "project" and other similar expressions that indicate future events or trends or are not statements of historical matters. These statements are based on our management's current expectations and beliefs, as well as a number of assumptions concerning future events.
Such forward-looking statements are subject to known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside of our control and all of which could cause actual results to differ materially from the results discussed in the forward-looking statements. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. Factors that could cause actual results to differ materially from those expressed or implied in forward-looking statements can be found in our reports filed with the Securities and Exchange Commission, which are available, free of charge, on the SEC's website at www.sec.gov.
Investor Relations:
The Equity Group Inc. |
In China |
Adam Prior, Senior Vice President |
Katherine Yao, Senior Associate |
(212) 836-9606 |
+86 10 5661 7012 |
PUHUI WEALTH INVESTMENT MANAGEMENT CO., LTD AND SUBSIDIARIES |
|||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS |
|||||||
For the Six Months Ended December 31, |
|||||||
2018 |
2017 |
||||||
REVENUES |
|||||||
Revenues |
$ |
1,872,685 |
$ |
505,479 |
|||
Revenues - related parties |
7,779 |
249,187 |
|||||
Sales taxes |
(13,494) |
(2,171) |
|||||
Total revenues |
1,866,970 |
752,495 |
|||||
OPERATING EXPENSES |
|||||||
Cost of revenues |
(206,881) |
(122,452) |
|||||
Selling expenses |
(922,693) |
(731,268) |
|||||
General and administrative expenses |
(1,392,919) |
(1,177,407) |
|||||
Total operating expenses |
(2,522,493) |
(2,031,127) |
|||||
LOSS FROM OPERATIONS |
(655,523) |
(1,278,632) |
|||||
OTHER INCOME (EXPENSES) |
|||||||
Interest income |
6,091 |
1,987 |
|||||
Other finance expenses |
(101,069) |
(29,789) |
|||||
Other income (expenses), net |
31,896 |
12,715 |
|||||
Total other expenses, net |
(63,082) |
(15,087) |
|||||
LOSS BEFORE INCOME TAXES |
(718,605) |
(1,293,719) |
|||||
PROVISION (BENEFIT) FOR INCOME TAXES |
|||||||
Current |
- |
19,261 |
|||||
Deferred |
27,410 |
(284,826) |
|||||
Total income tax provision (benefit) |
27,410 |
(265,565) |
|||||
NET LOSS |
(746,015) |
(1,028,154) |
|||||
Less: Net loss attributable to noncontrolling interest |
(282,524) |
(210,724) |
|||||
NET LOSS ATTRIBUTABLE TO PUHUI WEALTH |
$ |
(463,491) |
$ |
(817,430) |
|||
NET LOSS |
$ |
(746,015) |
$ |
(1,028,154) |
|||
OTHER COMPREHENSIVE INCOME (LOSS) |
|||||||
Foreign currency translation adjustment |
(285,769) |
56,836 |
|||||
COMPREHENSIVE LOSS |
$ |
(1,031,784) |
$ |
(971,318) |
|||
Less: Comprehensive loss attributable to noncontrolling interest |
(310,967) |
(191,119) |
|||||
COMPREHENSIVE LOSS ATTRIBUTABLE TO PUHUI WELATH |
$ |
(720,817) |
$ |
(780,199) |
|||
WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES |
|||||||
Basic and diluted |
10,090,126 |
10,000,000 |
|||||
EARNINGS PER SHARE |
|||||||
Basic and diluted |
$ |
(0.046) |
$ |
(0.082) |
|||
PUHUI WEALTH INVESTMENT MANAGEMENT CO., LTD AND SUBSIDIARIES |
|||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||||
December 31, |
June 30, |
||||||
2018 |
2018 |
||||||
ASSETS |
|||||||
CURRENT ASSETS |
|||||||
Cash |
$ |
7,465,079 |
$ |
4,809,040 |
|||
Short-term investments |
705,835 |
1,101,317 |
|||||
Accounts receivables |
1,129,876 |
1,673,764 |
|||||
Accounts receivables - related parties |
1,012,575 |
1,051,718 |
|||||
Other receivables |
542,101 |
206,831 |
|||||
Prepaid expenses and acquisition deposit |
4,743,879 |
681,899 |
|||||
Deferred offering costs |
- |
700,094 |
|||||
Total current assets |
15,599,345 |
10,224,663 |
|||||
PROPERTY AND EQUIPMENT, NET |
144,111 |
135,682 |
|||||
OTHER ASSETS |
|||||||
Intangible asset, net |
38,563 |
- |
|||||
Deferred tax assets, net |
696,615 |
782,911 |
|||||
Total other assets |
735,178 |
782,911 |
|||||
Total assets |
$ |
16,478,634 |
$ |
11,143,256 |
|||
LIABILITIES AND SHAREHOLDERS' EQUITY |
|||||||
CURRENT LIABILITIES |
|||||||
Customer deposits |
$ |
- |
$ |
250,529 |
|||
Other payables and accrued liabilities |
632,478 |
677,215 |
|||||
Other payables - related parties |
- |
196,300 |
|||||
Deferred revenues |
259,916 |
303,637 |
|||||
Taxes payable |
15,654 |
356,440 |
|||||
Current portion of long-term debt |
290,761 |
302,001 |
|||||
Total current liabilities |
1,198,809 |
2,086,122 |
|||||
LONG-TERM DEBT |
1,163,044 |
1,208,003 |
|||||
Total liabilities |
2,361,853 |
3,294,125 |
|||||
COMMITMENTS AND CONTINGENCIES |
|||||||
SHAREHOLDERS' EQUITY |
|||||||
Preferred shares, $0.001 par value, 1,000,000 shares authorized, 0 shares issued and |
- |
- |
|||||
outstanding as of December 31, 2018 and June 30, 2018 |
|||||||
Ordinary shares, $0.001 par value, 49,000,000 shares authorized, |
11,508 |
10,000 |
|||||
11,507,558 and 10,000,000 shares issued and outstanding of December 31, 2018 and June 30, 2018 |
|||||||
Additional paid-in capital |
21,911,045 |
14,613,119 |
|||||
Accumulated deficit |
(7,227,646) |
(6,764,155) |
|||||
Accumulated other comprehensive loss |
(264,646) |
(7,320) |
|||||
Total shareholders' equity attributable to controlling shareholders |
14,430,261 |
7,851,644 |
|||||
Noncontrolling interest |
(313,480) |
(2,513) |
|||||
Total shareholders' equity |
14,116,781 |
7,849,131 |
|||||
Total liabilities and shareholders' equity |
$ |
16,478,634 |
$ |
11,143,256 |
|||
PUHUI WEALTH INVESTMENT MANAGEMENT CO., LTD AND SUBSIDIARIES |
||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
For the Six Months Ended |
||||||||
December 31, |
||||||||
2018 |
2017 |
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
Net loss |
$ |
(746,015) |
$ |
(1,028,154) |
||||
Adjustments to reconcile net income to net cash (used in) |
||||||||
provided by operating activities: |
||||||||
Depreciation and amortization |
67,704 |
24,162 |
||||||
Loss on disposal of property and equipment |
- |
274 |
||||||
Impairment loss on equity securities |
5,512 |
- |
||||||
Deferred tax provision (benefit) |
57,271 |
(284,827) |
||||||
Change in operating assets and liabilities |
||||||||
Accounts receivables |
482,556 |
351,116 |
||||||
Other receivables |
(343,652) |
(69,936) |
||||||
Prepaid expenses |
(982,395) |
(160,863) |
||||||
Customer deposit received (returned) |
(231,956) |
963,034 |
||||||
Other payables and accrued liabilities |
85,310 |
94,452 |
||||||
Other payables - related parties |
(189,372) |
- |
||||||
Deferred revenue |
(32,485) |
246,689 |
||||||
Taxes payable |
(328,175) |
(42,576) |
||||||
Net cash (used in) provided by operating activities |
(2,155,697) |
93,371 |
||||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||
Proceeds from sales of short-term investments |
338,878 |
- |
||||||
Purchases of short-term investments |
- |
(4,878,049) |
||||||
Acquisition deposit |
(3,264,978) |
- |
||||||
Purchase of property and equipment |
(107,292) |
(18,680) |
||||||
Proceeds from sale of property and equipment |
- |
3,464 |
||||||
Purchase of intangible asset |
(12,558) |
- |
||||||
Net cash used in investing activities |
(3,045,950) |
(4,893,265) |
||||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||
Capital contribution from shareholders |
- |
5,516,522 |
||||||
Proceeds from issuance of ordinary shares through IPO, net |
8,032,912 |
- |
||||||
Proceeds from long-term debt |
- |
1,506,035 |
||||||
Net cash provided by financing activities |
8,032,912 |
7,022,557 |
||||||
EFFECT OF EXCHANGE RATE ON CASH |
(175,226) |
(30,017) |
||||||
INCREASE IN CASH |
2,656,039 |
2,192,646 |
||||||
CASH, beginning of period |
4,809,040 |
322,518 |
||||||
CASH, end of period |
$ |
7,465,079 |
$ |
2,515,164 |
||||
SUPPLEMENTAL CASH FLOW INFORMATION: |
||||||||
Cash paid for income tax |
$ |
227,152 |
$ |
- |
||||
Cash paid for interest |
$ |
196,655 |
$ |
- |
||||
NON-CASH TRANSACTIONS OF FINANCING ACTIVITIES |
||||||||
Prepaid IPO costs netted against IPO proceeds |
$ |
733,478 |
$ |
- |
||||
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