Recon Technology, Ltd Reports Financial Results for the First Six Months of Fiscal Year 2025
Recon Technology (NASDAQ: RCON) reported financial results for H1 FY2025, showing mixed performance. Total revenue decreased 7.0% to RMB42.1 million ($5.8 million), while gross profit increased to RMB13.4 million ($1.8 million). The company's gross margin improved to 31.7% from 26.7% year-over-year.
Notable segment performance included:
- Automation product revenue increased 19.2%
- Equipment and accessories revenue declined 12.2%
- Oilfield environmental protection revenue decreased 66.2%
- Platform outsourcing services revenue grew 53.7%
The company reported a net loss of RMB20.7 million ($2.8 million), an improvement from the previous year's loss of RMB23.1 million. As of December 31, 2024, RCON maintained a strong cash position of RMB145.3 million ($19.9 million).
Recon Technology (NASDAQ: RCON) ha riportato i risultati finanziari per il primo semestre dell'anno fiscale 2025, mostrando una performance mista. Il fatturato totale è diminuito del 7,0% a RMB42,1 milioni (5,8 milioni di dollari), mentre il profitto lordo è aumentato a RMB13,4 milioni (1,8 milioni di dollari). Il margine lordo dell'azienda è migliorato al 31,7% rispetto al 26,7% dell'anno precedente.
Le performance dei segmenti significativi hanno incluso:
- Il fatturato dei prodotti di automazione è aumentato del 19,2%
- Il fatturato di attrezzature e accessori è diminuito del 12,2%
- Il fatturato per la protezione ambientale nei campi petroliferi è calato del 66,2%
- Il fatturato dei servizi di outsourcing della piattaforma è cresciuto del 53,7%
L'azienda ha riportato una perdita netta di RMB20,7 milioni (2,8 milioni di dollari), un miglioramento rispetto alla perdita dell'anno precedente di RMB23,1 milioni. Al 31 dicembre 2024, RCON ha mantenuto una solida posizione di liquidità di RMB145,3 milioni (19,9 milioni di dollari).
Recon Technology (NASDAQ: RCON) reportó resultados financieros para el primer semestre del año fiscal 2025, mostrando un desempeño mixto. Los ingresos totales disminuyeron un 7,0% a RMB42,1 millones (5,8 millones de dólares), mientras que la ganancia bruta aumentó a RMB13,4 millones (1,8 millones de dólares). El margen bruto de la compañía mejoró al 31,7% desde el 26,7% del año anterior.
El desempeño notable de los segmentos incluyó:
- Los ingresos de productos de automatización aumentaron un 19,2%
- Los ingresos de equipos y accesorios disminuyeron un 12,2%
- Los ingresos por protección ambiental en campos petroleros disminuyeron un 66,2%
- Los ingresos por servicios de subcontratación de plataformas crecieron un 53,7%
La compañía reportó una pérdida neta de RMB20,7 millones (2,8 millones de dólares), una mejora con respecto a la pérdida del año anterior de RMB23,1 millones. Al 31 de diciembre de 2024, RCON mantuvo una sólida posición de efectivo de RMB145,3 millones (19,9 millones de dólares).
Recon Technology (NASDAQ: RCON)는 2025 회계연도 상반기 재무 결과를 발표하며 혼합된 실적을 보였습니다. 총 수익은 7.0% 감소하여 4,210만 위안(580만 달러)에 달했으며, 총 이익은 1,340만 위안(180만 달러)으로 증가했습니다. 회사의 총 마진은 전년 대비 26.7%에서 31.7%로 개선되었습니다.
주요 부문 실적은 다음과 같습니다:
- 자동화 제품 수익은 19.2% 증가했습니다.
- 장비 및 액세서리 수익은 12.2% 감소했습니다.
- 유전 환경 보호 수익은 66.2% 감소했습니다.
- 플랫폼 아웃소싱 서비스 수익은 53.7% 증가했습니다.
회사는 2,070만 위안(280만 달러)의 순손실을 보고했으며, 이는 전년의 2,310만 위안 손실보다 개선된 수치입니다. 2024년 12월 31일 기준으로 RCON은 1억 4,530만 위안(1,990만 달러)의 강력한 현금 보유고를 유지하고 있습니다.
Recon Technology (NASDAQ: RCON) a publié ses résultats financiers pour le premier semestre de l'exercice 2025, montrant une performance mitigée. Le chiffre d'affaires total a diminué de 7,0 % pour atteindre 42,1 millions de RMB (5,8 millions de dollars), tandis que le bénéfice brut a augmenté à 13,4 millions de RMB (1,8 million de dollars). La marge brute de l'entreprise s'est améliorée, passant de 26,7 % à 31,7 % par rapport à l'année précédente.
Les performances notables des segments comprenaient :
- Les revenus des produits d'automatisation ont augmenté de 19,2 %
- Les revenus des équipements et accessoires ont diminué de 12,2 %
- Les revenus de la protection environnementale des champs pétroliers ont diminué de 66,2 %
- Les revenus des services d'externalisation de la plateforme ont augmenté de 53,7 %
L'entreprise a enregistré une perte nette de 20,7 millions de RMB (2,8 millions de dollars), une amélioration par rapport à la perte de 23,1 millions de RMB de l'année précédente. Au 31 décembre 2024, RCON maintenait une solide position de liquidité de 145,3 millions de RMB (19,9 millions de dollars).
Recon Technology (NASDAQ: RCON) hat die finanziellen Ergebnisse für das erste Halbjahr des Geschäftsjahres 2025 veröffentlicht, die eine gemischte Leistung zeigen. Der Gesamtumsatz sank um 7,0% auf 42,1 Millionen RMB (5,8 Millionen USD), während der Bruttogewinn auf 13,4 Millionen RMB (1,8 Millionen USD) anstieg. Die Bruttomarge des Unternehmens verbesserte sich von 26,7% auf 31,7% im Jahresvergleich.
Bemerkenswerte Segmentleistungen umfassten:
- Der Umsatz der Automatisierungsprodukte stieg um 19,2%
- Der Umsatz von Geräten und Zubehör sank um 12,2%
- Der Umsatz im Bereich Umweltschutz im Ölfeld fiel um 66,2%
- Der Umsatz der Plattform-Outsourcing-Dienste wuchs um 53,7%
Das Unternehmen berichtete von einem Nettoverlust von 20,7 Millionen RMB (2,8 Millionen USD), eine Verbesserung gegenüber dem Verlust von 23,1 Millionen RMB im Vorjahr. Zum 31. Dezember 2024 hielt RCON eine starke Liquiditätsposition von 145,3 Millionen RMB (19,9 Millionen USD).
- Gross profit increased to RMB13.4 million, with margin improving to 31.7%
- Automation product revenue grew 19.2% due to increased market demand
- Platform outsourcing services revenue increased 53.7%
- Net loss decreased by RMB2.4 million year-over-year
- Strong cash position of RMB145.3 million
- Total revenue declined 7.0% to RMB42.1 million
- Oilfield environmental protection revenue fell 66.2%
- Equipment and accessories revenue decreased 12.2%
- Operating loss increased by RMB4.1 million
- Research and development expenses increased by 50.3%
Insights
Recon Technology's H1 FY2025 results present a mixed financial picture with some operational improvements despite topline pressure. Total revenue decreased
The company reduced its net loss to
RCON maintains a solid liquidity position with
The upcoming plastic recycling plant represents a potential new revenue stream, but investors should note that the company remains unprofitable with persistent operational losses despite the margin improvements. The divergence between improved profitability metrics and worsening operating loss indicates the company is still struggling to balance growth investments with profitability.
RCON's latest results reflect both the opportunities and challenges in China's evolving energy services landscape. The
The heating furnace category's growth aligns with Chinese oil companies' expansion of production capacity, while the temporary decline in offshore equipment revenue should reverse as indicated by management's expectation of overall revenue growth from offshore customers in 2025. The strategic price concessions in the wastewater business, while hurting short-term margins, could secure valuable long-term contracts in an increasingly competitive market.
The company's increased R&D spending (
The upcoming chemical recycling plant for low-value plastics represents a significant diversification effort into the circular economy space. With construction beginning April 2025 and production expected in H2 2025, this project could open new revenue streams aligned with China's sustainability goals. The successful qualification process marks a meaningful milestone, though investors should monitor execution risks during the construction and production ramp-up phases.
First Six Months of Fiscal 2025 Financial Highlights:
- Total revenue decreased to
RMB42.1 million ( ) for the six months ended December 31, 2024, from$5.8 million RMB45.3 million ( ) for the same period in 2023.$6.2 million - Gross profit increased to
RMB13.4 million ( ) for the six months ended December 31, 2024, from$1.8 million RMB12.1 million ( ) for the same period in 2023.$1.7 million - Gross margin increased to
31.7% for the six months ended December 31, 2024 from26.7% for the same period in 2023. - Net loss was
RMB20.7 million ( ) for the six months ended December 31, 2024, a decrease of$2.8 million RMB2.4 million ( ) from net loss of$0.3 million RMB23.1 million ( ) for the same period of 2023.$3.2 million
For the Six Months Ended | |||||||||||||||
December 31, | |||||||||||||||
(in RMB millions, except earnings per share; differences due to rounding) | 2024 | 2023 | Increase /(Decrease) | Percentage Change | |||||||||||
Revenue | RMB | 42.1 | RMB | 45.3 | RMB | (3.2) | (7.0) | % | |||||||
Gross profit | 13.4 | 12.1 | 1.3 | 10.3 | % | ||||||||||
Gross margin | 31.7 | % | 26.7 | % | 18.7 | % | — | ||||||||
Net loss | (20.7) | (23.1) | (2.4) | (10.3) | % | ||||||||||
Net loss per share – Basic and diluted | (2.29) | (8.27) | 5.98 | (72.3) | % |
Management Commentary
Mr. Shenping Yin, Founder and CEO of Recon, said, "For the six months ended December 31, 2024, our oilfield customers' production continued to increase, and demand for our automation and oilfield specialized equipment also increased, with corresponding revenue and gross profit both rising and improving. However, our revenue as a whole declined slightly due to fluctuations in demand from some of our new businesses and customers. We anticipate a steady rebound in our business and operating quality, particularly in our two core segments: digital solutions and oilfield environmental protection. As
First Six Months Fiscal 2025 Financial Results:
Revenue
Total revenues for the six months ended December 31, 2024 were approximately
- Revenue from automation product and software increased by
RMB3.4 million ( ) or$0.5 million 19.2% . For the six months ended December 31, 2024, the increase in revenue from automation products and software is primarily due to the growing market demand for automated operations. - Revenue from equipment and accessories decreased by
RMB2.2 million ( ) or$0.3 million 12.2% . For the six months ended December 31, 2024, revenues from the heating furnace category increased byRMB1.9 million compared to the same period in 2023, driven by our oilfield customers' expanded production capacity. Revenues from equipment used in the offshore oilfield category decreased byRMB3.3 million , primarily due to reduced demand from our customers. We anticipate an overall increase in revenues from offshore customers in 2025. - Revenue from oilfield environmental protection decreased by
RMB5.3 million ( ) or$0.7 million 66.2% , primarily due to the expiration of Gansu BHD's hazardous waste operation permit during the six-month period ending December 31, 2024. As a result, no revenue was recorded. The company is currently engaged in the active application process for the renewal of relevant qualifications. Besides, some customers request and we agreed to a lower price for a portion of our wastewater business in order to establish a long-term relationship, resulting in a decrease in revenue from that portion of the business. - Revenue from platform outsourcing services increased by
RMB1.0 million ( ) or$0.1 million 53.7% . The increase was mainly due to the rise in transaction volumes of diesel users and the higher settlement rates with freight trading platforms clients.
Cost of revenue
Cost of revenues decreased from
- For the six months ended December 31, 2023 and 2024, cost of revenue from automation product and software was approximately
RMB14.0 million andRMB12.4 million ( ), respectively, representing a decrease of approximately$1.7 million RMB1.6 million ( ) or$0.2 million 11.8% . The decrease in cost of revenue from automation product and software was primarily attributable to the proportion of operation and maintenance services, which have lower costs. - For the six months ended December 31, 2023 and 2024, cost of revenue from equipment and accessories was approximately
RMB12.8 million andRMB11.2 million ( ), respectively, representing a decrease of approximately$1.5 million RMB1.6 million ( ) or$0.2 million 12.7% . The costs of the furnace business increased in this period due to the corresponding increase in revenue, whereas the costs of the offshore oilfield customers decreased in line with the decreased revenue, resulting in a reduced total cost of sales. - For the six months ended December 31,2023 and 2024, cost of revenue from oilfield environmental protection was approximately
RMB6.0 million andRMB4.9 million ( ), respectively, representing a decrease of approximately$0.7 million RMB1.1 million ( ) or$0.2 million 19.4% . The decrease in the cost of revenue from oilfield environmental protection was in line with decrease in revenue. - For the six months ended December 31,2023 and 2024, cost of revenue from platform outsourcing services remained stable at
RMB0.3 million ( ).$0.05 million
Gross profit
Gross profit increased to
- For the six months ended December 31, 2023 and 2024, our gross profit from automation product and software was approximately
RMB3.5 million andRMB8.5 million ( ), respectively, representing an increase in gross profit of approximately$1.2 million RMB5.0 million ( ) or$0.7 million 143.2% . The increase in gross margin was primarily due to the elevated proportion of high-margin service businesses. - For the six months ended December 31, 2023 and 2024, gross profit from equipment and accessories was approximately
RMB5.1 million andRMB4.5 million ( ), respectively, representing a decrease of approximately$0.6 million RMB0.6 million ( ) or 10.9 %. The gross margin for equipment and accessories has remained relatively stable in this period.$0.1 million - For the six months ended December 31, 2023 and 2024, gross profit from oilfield environmental protection was approximately
RMB2.0 million and negativeRMB2.1 million (negative ), respectively, representing a decrease of$0.3 million RMB4.1 million ( ), or$0.6 million 204.8% . The main reason for the decrease in gross margin is that one of our customers reduced the settlement price. - For the six months ended December 31, 2023 and 2024, gross profit from platform outsourcing services was approximately
RMB1.5 million andRMB2.4 million ( ), respectively, representing an increase of approximately$0.3 million RMB0.9 million ( ), or$0.1 million 63.8% , primarily due to the increase in the settlement rate.
Operating expenses
Selling expenses increased by
General and administrative expenses increased by
The Company also recorded allowance for credit losses of
Research and development expenses increased by
Loss from operations
Loss from operations was
Change in fair value of warrant liability
The Company classified the warrants issued in connection with common share offering as liabilities at their fair value and adjusted the warrant instrument to fair value at each reporting period. This liability is subject to re-measurement at each balance sheet date until exercised, and any change in fair value is recognized in our statement of operations. Loss in fair value changes of warrant liability was
Interest income
Net interest income was
Other income (expenses), net.
Other net expenses was
Net loss
As a result of the factors described above, net loss was
Cash and short-term investment
As of June 30, 2024, we had cash in the amount of approximately
About Recon Technology, Ltd ("RCON")
Recon Technology, Ltd (NASDAQ: RCON) is
Forward-Looking Statements
Recon includes "forward-looking statements" within the meaning of the federal securities laws throughout this press release. A reader can identify forward-looking statements because they are not limited to historical fact or they use words such as "scheduled," "may," "will," "could," "should," "would," "expect," "believe," "anticipate," "project," "plan," "estimate," "forecast," "goal," "objective," "committed," "intend," "continue," or "will likely result," and similar expressions that concern Recon's strategy, plans, intentions or beliefs about future occurrences or results. Forward-looking statements are subject to risks, uncertainties and other factors that may change at any time and may cause actual results to differ materially from those that Recon expected. Many of these statements are derived from Recon's operating budgets and forecasts, which are based on many detailed assumptions that Recon believes are reasonable, or are based on various assumptions about certain plans, activities or events which we expect will or may occur in the future. However, it is very difficult to predict the effect of known factors, and Recon cannot anticipate all factors that could affect actual results that may be important to an investor. All forward-looking information should be evaluated in the context of these risks, uncertainties and other factors, including those factors disclosed under "Risk Factors" in Recon's most recent Annual Report on Form 20‑F and any subsequent half-year financial filings on Form 6‑K filed with the Securities and Exchange Commission. All forward-looking statements are qualified in their entirety by the cautionary statements that Recon makes from time to time in its SEC filings and public communications. Recon cannot assure the reader that it will realize the results or developments Recon anticipates, or, even if substantially realized, that they will result in the consequences or affect Recon or its operations in the way Recon expects. Forward-looking statements speak only as of the date made. Recon undertakes no obligation to update or revise any forward-looking statements to reflect events or circumstances arising after the date on which they were made, except as otherwise required by law. As a result of these risks and uncertainties, readers are cautioned not to place undue reliance on any forward-looking statements included herein or that may be made elsewhere from time to time by, or on behalf of, Recon.
RECON TECHNOLOGY, LTD CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS (UNAUDITED) | |||||||||
As of June 30, | As of December 31, | As of December 31, | |||||||
2024 | 2024 | 2024 | |||||||
RMB | RMB | US Dollars | |||||||
ASSETS | |||||||||
Current assets | |||||||||
Cash | ¥ | 109,991,674 | ¥ | 145,284,391 | $ | 19,903,880 | |||
Restricted cash | 848,936 | 8,123 | 1,113 | ||||||
Short-term investments | 88,091,794 | — | — | ||||||
Notes receivable | 1,341,820 | 3,206,733 | 439,321 | ||||||
Accounts receivable, net | 38,631,762 | 40,366,074 | 5,530,129 | ||||||
Inventories, net | 1,128,912 | 1,541,020 | 211,119 | ||||||
Other receivables, net | 3,352,052 | 3,934,865 | 539,074 | ||||||
Other receivables - related parties | 275,976 | 279,976 | 38,357 | ||||||
Loans to third parties | 208,928,370 | 231,952,064 | 31,777,302 | ||||||
Purchase advances, net | 5,156,550 | 9,485,972 | 1,299,573 | ||||||
Contract costs, net | 48,335,817 | 41,628,922 | 5,703,139 | ||||||
Prepaid expenses | 401,586 | 696,877 | 95,471 | ||||||
Deferred offering cost | — | 810,082 | 110,981 | ||||||
Total current assets | 506,485,249 | 479,195,099 | 65,649,459 | ||||||
Property and equipment, net | 22,137,940 | 20,859,877 | 2,857,791 | ||||||
Construction in progress | 219,132 | 1,144,095 | 156,740 | ||||||
Long-term loan to third parties | — | 18,500,000 | 2,534,490 | ||||||
Operating lease right-of-use assets, net (including 2024 and December 31, 2024, respectively) | 23,547,193 | 22,014,961 | 3,016,037 | ||||||
Total Assets | ¥ | 552,389,514 | ¥ | 541,714,032 | $ | 74,214,517 | |||
LIABILITIES AND EQUITY | |||||||||
Current liabilities | |||||||||
Short-term bank loans | ¥ | 12,425,959 | ¥ | 11,582,636 | $ | 1,586,815 | |||
Accounts payable | 10,187,518 | 14,100,871 | 1,931,811 | ||||||
Other payables | 2,769,685 | 1,559,371 | 213,633 | ||||||
Other payable- related parties | 2,299,069 | 1,787,315 | 244,861 | ||||||
Contract liabilities | 1,820,481 | 4,098,136 | 561,442 | ||||||
Accrued payroll and employees' welfare | 3,237,164 | 3,416,373 | 468,041 | ||||||
Taxes payable | 993,365 | 1,685,496 | 230,912 | ||||||
Short-term borrowings - related parties | 10,002,875 | 10,018,208 | 1,372,489 | ||||||
Operating lease liabilities - current (including and December 31, 2024, respectively) | 3,741,247 | 3,891,976 | 533,198 | ||||||
Total Current Liabilities | 47,477,363 | 52,140,382 | 7,143,202 | ||||||
Operating lease liabilities - non-current (including and December 31, 2024, respectively) | 3,971,285 | 2,781,196 | 381,022 | ||||||
Long-term borrowings - related party | 10,000,000 | 10,000,000 | 1,369,994 | ||||||
Warrant liability - non-current | 6,969 | 17,504 | 2,398 | ||||||
Total Liabilities | ¥ | 61,455,617 | ¥ | 64,939,082 | $ | 8,896,616 | |||
Commitments and Contingencies | |||||||||
Shareholders' Equity | |||||||||
Class A Ordinary Shares, issued and outstanding as of June 30, 2024 and December 31, 2024, respectively | 99,634 | 99,634 | 13,650 | ||||||
Class B Ordinary Shares, issued and outstanding as of June 30, 2024 and December 31, 2024, respectively | 4,693 | 14,038 | 1,923 | ||||||
Additional paid-in capital | 681,476,717 | 686,830,523 | 94,095,396 | ||||||
Statutory reserve | 4,148,929 | 4,148,929 | 568,401 | ||||||
Accumulated deficit | (220,312,085) | (240,900,414) | (33,003,221) | ||||||
Accumulated other comprehensive income | 37,136,649 | 38,344,150 | 5,253,127 | ||||||
Total Recon Technology, Ltd' equity | 502,554,537 | 488,536,860 | 66,929,276 | ||||||
Non-controlling interests | (11,620,640) | (11,761,910) | (1,611,375) | ||||||
Total shareholders' equity | 490,933,897 | 476,774,950 | 65,317,901 | ||||||
Total Liabilities and Shareholders' Equity | ¥ | 552,389,514 | ¥ | 541,714,032 | $ | 74,214,517 | |||
|
RECON TECHNOLOGY, LTD CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (UNAUDITED) | |||||||||
For the six months ended | |||||||||
December 31, | |||||||||
2023 | 2024 | 2024 | |||||||
RMB | RMB | USD | |||||||
Revenue | 45,256,672 | 42,069,270 | 5,763,466 | ||||||
Cost of revenue | 33,150,930 | 28,714,468 | 3,933,866 | ||||||
Gross profit | 12,105,742 | 13,354,802 | 1,829,600 | ||||||
Selling and distribution expenses | 4,547,115 | 5,177,944 | 709,375 | ||||||
General and administrative expenses | 22,042,042 | 24,038,744 | 3,293,294 | ||||||
Allowance for credit losses | 1,553,364 | 870,714 | 119,287 | ||||||
Research and development expenses | 6,765,287 | 10,167,182 | 1,392,898 | ||||||
Operating expenses | 34,907,808 | 40,254,584 | 5,514,854 | ||||||
Loss from operations | (22,802,066) | (26,899,782) | (3,685,254) | ||||||
Other income (expenses) | |||||||||
Subsidy income | 131,428 | 21,045 | 2,883 | ||||||
Interest income | 12,060,640 | 7,136,259 | 977,663 | ||||||
Interest expense | (1,683,289) | (580,977) | (79,594) | ||||||
Loss in fair value changes of warrants liability | (1,941,195) | (10,327) | (1,415) | ||||||
Foreign exchange transaction loss | (76,040) | (313,263) | (42,917) | ||||||
Other expenses | (8,701,288) | (80,945) | (11,088) | ||||||
Other income, net | (209,744) | 6,171,792 | 845,532 | ||||||
Loss before income tax | (23,011,810) | (20,727,990) | (2,839,722) | ||||||
Income tax expenses | 96,041 | 1,609 | 220 | ||||||
Net loss | (23,107,851) | (20,729,599) | (2,839,942) | ||||||
Less: Net loss attributable to non-controlling interests | (553,829) | (141,270) | (19,354) | ||||||
Net loss attributable to Recon Technology, Ltd | ¥ | (22,554,022) | ¥ | (20,588,329) | $ | (2,820,588) | |||
Comprehensive income (loss) | |||||||||
Net loss | (23,107,851) | (20,729,599) | (2,839,942) | ||||||
Foreign currency translation adjustment | (4,609,399) | 1,207,501 | 165,427 | ||||||
Comprehensive loss | (27,717,250) | (19,522,098) | (2,674,515) | ||||||
Less: Comprehensive loss attributable to non- controlling interests | (553,829) | (141,270) | (19,354) | ||||||
Comprehensive loss attributable to Recon Technology, Ltd | ¥ | (27,163,421) | ¥ | (19,380,828) | $ | (2,655,161) | |||
Loss per share - basic and diluted | ¥ | (8.27) | ¥ | (2.29) | $ | (0.31) | |||
Weighted - average shares -basic and diluted | 2,728,056 | 8,978,328 | 8,978,328 | ||||||
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RECON TECHNOLOGY, LTD CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS (UNAUDITED) | |||||||||
For the six months ended December 31, | |||||||||
2023 | 2024 | 2024 | |||||||
RMB | RMB | US Dollars | |||||||
Cash flows from operating activities: | |||||||||
Net loss | ¥ | (23,107,851) | ¥ | (20,729,599) | $ | (2,839,942) | |||
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||||
Depreciation and amortization | 1,426,971 | 1,724,066 | 236,196 | ||||||
Loss from disposal of equipment | 32,252 | 9,607 | 1,316 | ||||||
Gain in fair value changes of warrants liability | 10,461,075 | 10,327 | 1,415 | ||||||
Allowance for credit losses | 1,553,364 | 870,714 | 119,287 | ||||||
Allowance for slow moving inventories | (350,637) | (523,228) | (71,682) | ||||||
Amortization of right-of-use assets | 570,959 | 1,532,232 | 209,915 | ||||||
Restricted shares issued for management and employees | 2,866,560 | 5,353,151 | 733,376 | ||||||
Restricted shares issued for services | 1,070,143 | — | — | ||||||
Accrued interest income from loans to third parties | (4,415,298) | (6,779,697) | (928,815) | ||||||
Accrued interest income from short-term investment | (2,352,250) | — | — | ||||||
Changes in operating assets and liabilities: | |||||||||
Notes receivable | (8,790,327) | (1,864,913) | (255,492) | ||||||
Accounts receivable | (4,412,034) | (3,348,819) | (458,786) | ||||||
Inventories | 4,863,435 | (718,490) | (98,433) | ||||||
Other receivables | 5,465,227 | (358,057) | (49,051) | ||||||
Other receivables-related parties | — | (4,000) | (548) | ||||||
Purchase advances | 558,040 | 81,256 | 11,132 | ||||||
Contract costs | 10,442,916 | 8,057,774 | 1,103,911 | ||||||
Prepaid expense | 54,734 | (295,291) | (40,455) | ||||||
Operating lease liabilities | (2,027,067) | (1,039,360) | (142,392) | ||||||
Accounts payable | 1,271,140 | 3,913,353 | 536,127 | ||||||
Other payables | (4,103,150) | (1,194,817) | (163,689) | ||||||
Other payables-related parties | (383,378) | (511,754) | (70,110) | ||||||
Contract liabilities | 2,140,385 | 2,277,655 | 312,037 | ||||||
Accrued payroll and employees' welfare | 17,399 | 179,209 | 24,552 | ||||||
Taxes payable | 537,591 | 691,901 | 94,790 | ||||||
Net cash used in operating activities | (6,609,801) | (12,666,780) | (1,735,341) | ||||||
Cash flows from investing activities: | |||||||||
Purchases of property and equipment | (216,082) | (455,380) | (62,387) | ||||||
Proceeds from disposal of equipment | 20,000 | — | — | ||||||
Purchase of land use right | (15,000,251) | — | — | ||||||
Collection of loans to third parties | 44,613,948 | 2,904,352 | 397,895 | ||||||
Payments made for loans to third parties | (16,600,000) | (36,897,900) | (5,054,992) | ||||||
Payments and prepayments for construction in progress | — | (5,337,873) | (731,286) | ||||||
Payments for short-term investments | (131,598,400) | — | — | ||||||
Redemption of short-term investments | 180,338,865 | 88,892,092 | 12,178,167 | ||||||
Net cash generated by investing activities | 61,558,080 | 49,105,291 | 6,727,397 | ||||||
Cash flows from financing activities: | |||||||||
Repayments of short-term bank loans | (123,000) | (843,487) | (115,557) | ||||||
Proceeds from short-term borrowings-related parties | 10,000,000 | — | — | ||||||
Repayments of short-term borrowings-related parties | (10,018,222) | — | — | ||||||
Deferred offering costs | — | (810,082) | (110,981) | ||||||
Redemption of warrants | (31,866,604) | — | — | ||||||
Capital contribution by controlling shareholders | — | 10,000 | 1,370 | ||||||
Net cash used in financing activities | (32,007,826) | (1,643,569) | (225,168) | ||||||
Effect of exchange rate fluctuation on cash and restricted cash | (5,945,117) | (343,038) | (46,996) | ||||||
Net increase in cash and restricted cash | 16,995,336 | 34,451,904 | 4,719,892 | ||||||
Cash and restricted cash at beginning of period | 104,857,345 | 110,840,610 | 15,185,101 | ||||||
Cash and restricted cash at end of period | ¥ | 121,852,681 | ¥ | 145,292,514 | $ | 19,904,993 | |||
Supplemental cash flow information | |||||||||
Cash paid during the period for interest | ¥ | 468,440 | ¥ | 518,086 | $ | 133,730 | |||
Cash paid during the period for taxes | ¥ | 16,505 | ¥ | 1,363,403 | $ | 294,729 | |||
Reconciliation of cash and restricted cash, beginning of period | |||||||||
Cash | ¥ | 104,125,800 | ¥ | 109,991,674 | $ | 15,068,797 | |||
Restricted cash | 731,545 | 848,936 | 116,304 | ||||||
Cash and restricted cash, beginning of period | ¥ | 104,857,345 | ¥ | 110,840,610 | $ | 15,185,101 | |||
Reconciliation of cash and restricted cash, end of period | |||||||||
Cash | ¥ | 121,848,777 | ¥ | 145,284,391 | $ | 19,903,880 | |||
Restricted cash | 3,904 | 8,123 | 1,113 | ||||||
Cash and restricted cash, end of period | ¥ | 121,852,681 | ¥ | 145,292,514 | $ | 19,904,993 | |||
Non-cash investing and financing activities | |||||||||
Right-of-use assets obtained in exchange for operating lease obligations | ¥ | 298,783 | ¥ | — | $ | — | |||
The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements. |
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SOURCE Recon Technology, Ltd