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Recon Technology, Ltd Reports Financial Results for the First Six Months of Fiscal Year 2025

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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).

Positive
  • 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
Negative
  • 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 7.0% to RMB42.1 million ($5.8 million), yet gross profit increased to RMB13.4 million ($1.8 million) with gross margin expanding significantly from 26.7% to 31.7%. This margin expansion primarily stems from a shift toward higher-margin services in their automation segment.

The company reduced its net loss to RMB20.7 million ($2.8 million) from RMB23.1 million ($3.2 million) year-over-year, representing modest progress. However, operating losses increased by RMB4.1 million due to higher operating expenses across all categories, particularly a 50.3% jump in R&D expenses to RMB10.2 million, signaling continued investment in future capabilities.

RCON maintains a solid liquidity position with RMB145.3 million ($19.9 million) in cash, providing adequate runway for operations and planned investments. The segment performance varies considerably – automation products showed strong growth with gross profit increasing 143.2%, while environmental protection turned negative with a gross profit decline of 204.8% due to customer price reductions.

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 19.2% revenue increase in automation products and software demonstrates the accelerating demand for digitalization in Chinese oilfields, where producers are prioritizing operational efficiency and production stability.

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 (50.3% rise) appears strategic given the technology-driven transformation of China's oil service sector. As Chinese oil producers focus on technology upgrades for stable production, RCON's investments position it to capitalize on this trend.

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.

BEIJING, March 31, 2025 /PRNewswire/ -- Recon Technology, Ltd (NASDAQ: RCON) ("Recon" or the "Company"), a China-based independent solutions integrator in the oilfield service and environmental protection, electric power and coal chemical industries, today announced its financial results for the first six months of fiscal year 2025.

First Six Months of Fiscal 2025 Financial Highlights:

  • Total revenue decreased to RMB42.1 million ($5.8 million) for the six months ended December 31, 2024, from RMB45.3 million ($6.2 million) for the same period in 2023.

  • Gross profit increased to RMB13.4 million ($1.8 million) for the six months ended December 31, 2024, from RMB12.1 million ($1.7 million) for the same period in 2023.

  • Gross margin increased to 31.7% for the six months ended December 31, 2024 from 26.7% for the same period in 2023.

  • Net loss was RMB20.7 million ($2.8 million) for the six months ended December 31, 2024, a decrease of RMB2.4 million ($0.3 million) from net loss of RMB23.1 million ($3.2 million) for the same period of 2023.


















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 China's oil service companies are in a stage of development driven by customers' rising demand for stable production and supply and technology upgrades, we will continue to increase our investment in technology and continue to improve our long-term corporate competitiveness. In addition, our ongoing project to build a chemical recycling plant for low-value plastics made a significant breakthrough during the period. We have successfully obtained the necessary qualifications for the production and commencement of construction of the plant, which is scheduled to begin in April 2025 and enter the formal production phase in the second half of 2025."

First Six Months Fiscal 2025 Financial Results:

Revenue

Total revenues for the six months ended December 31, 2024 were approximately RMB42.1 million ($5.8 million), a decrease of approximately RMB3.2 million ($0.4 million) or 7.0% from RMB45.3 million ($6.2 million) for the same period in 2023.

  •  Revenue from automation product and software increased by RMB3.4 million ($0.5 million) or 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 ($0.3 million) or 12.2%. For the six months ended December 31, 2024, revenues from the heating furnace category increased by RMB1.9 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 by RMB3.3 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 ($0.7 million) or 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 ($0.1 million) or 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 RMB33.2 million ($4.5 million) for the six months ended December 31, 2023 to RMB 28.7 million ($3.9 million) for the same period in 2024.

  • For the six months ended December 31, 2023 and 2024, cost of revenue from automation product and software was approximately RMB14.0 million and RMB12.4 million ($1.7 million), respectively, representing a decrease of approximately RMB1.6 million ($0.2 million) or 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 and RMB11.2 million ($1.5 million), respectively, representing a decrease of approximately RMB1.6 million ($0.2 million) or 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 and RMB4.9 million ($0.7 million), respectively, representing a decrease of approximately RMB1.1 million ($0.2 million) or 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 RMB13.4 million ($1.8 million) for the six months ended December 31,2024 from RMB12.1million ($1.7 million) for the same period in 2023. Our gross profit as a percentage of revenue increased to 31.7% for the six months ended December 31, 2024 from 26.7% for the same period in 2023.

  • For the six months ended December 31, 2023 and 2024, our gross profit from automation product and software was approximately RMB3.5 million and RMB8.5 million ($1.2 million), respectively, representing an increase in gross profit of approximately RMB5.0 million ($0.7 million) or 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 and RMB4.5 million ($0.6 million), respectively, representing a decrease of approximately RMB0.6 million ($0.1 million) or 10.9 %. The gross margin for equipment and accessories has remained relatively stable in this period.

  • For the six months ended December 31, 2023 and 2024, gross profit from oilfield environmental protection was approximately RMB2.0 million and negative RMB2.1 million (negative $0.3 million), respectively, representing a decrease of RMB4.1 million ($0.6 million), or 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 and RMB2.4 million ($0.3 million), respectively, representing an increase of approximately RMB0.9 million ($0.1 million), or 63.8%, primarily due to the increase in the settlement rate.

Operating expenses

Selling expenses increased by 13.9%, or RMB0.7 million ($0.1 million), from RMB4.6 million for the six months ended December 31, 2023 to RMB5.2 million ($0.6 million) in the same period of 2024.

General and administrative expenses increased by 9.1%, or RMB2.0 million ($0.3 million), from RMB22.0 million for the six months ended December 31, 2023 to RMB24.0 million ($3.3 million) in the same period of 2024.

The Company also recorded allowance for credit losses of RMB1.6 million for the six months ended December 31, 2023 as compared to allowance for credit losses of RMB0.9 million ($0.1 million) for the same period in 2024.

Research and development expenses increased by 50.3%, or RMB3.4 million ($0.5 million) from RMB6.8 million for the six months ended December 31, 2023 to RMB10.2 million ($1.4 million) for the same period of 2024.

Loss from operations

Loss from operations was RMB26.9 million ($3.7 million) for the six months ended December 31, 2024, compared to a loss of RMB22.8 million for the same period of 2023. This RMB4.1 million ($0.6 million) increase in operating losses was mainly driven by higher operating expenses, as previously discussed.

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 RMB1.9 million and RMB0.01 million ($0.001 million) for the six months ended December 31, 2023 and 2024, respectively. The primary reason for the decrease of loss in the fair value of the warrant liability was that on December 14, 2023, we redeemed an aggregate of 17,953,269 warrants (equivalent to 997,404 warrants post the 2024 Reverse Split) from the Sellers.

Interest income

Net interest income was RMB6.6 million ($0.9 million) for the six months ended December 31, 2024, compared to net interest income of RMB10.4 million for the same period of 2023. The RMB3.8 million ($0.5 million) decrease in net interest income was primarily due to the collection of loans to third parties and coupled with a reduction in interest rates for new loans.

Other income (expenses), net.

Other net expenses was RMB0.4 million ($0.1 million) for the six months ended December 31, 2024, compared to other net expenses of RMB8.6 million for the same period of 2023, the RMB8.2 million ($1.1 million) decrease in other net expenses was primarily due to a decrease of RMB0.1million($0.02 million) in subsidy income  and a decrease in other expenses of RMB8.5 million ($1.2 million) which was partially offset by an increase loss from foreign currency of RMB0.2 million ($0.03 million). The decrease in other expenses, as we accrued RMB8.5 million ($1.2 million) estimated liability based on the potential for future significant transaction compensation in contracts to repurchase investor warrants during the six months ended December 31, 2023. For the six months ended December 31, 2024, we do not have this situation.

Net loss

As a result of the factors described above, net loss was RMB20.7 million ($2.8 million) for the six months ended December 31, 2024, a decrease of RMB2.4 million ($0.3 million) from net loss of RMB23.1 million for the same period of 2023.

Cash and short-term investment

As of June 30, 2024, we had cash in the amount of approximately RMB110.0 million ($15.1 million) and short-term investment in bank fixed income product of approximately RMB88.1 million ($12.1 million). As of December 31, 2024, we had cash in the amount of approximately RMB145.3 million ($19.9 million) and short-term investment in bank fixed income product of approximately nil.

About Recon Technology, Ltd ("RCON")

Recon Technology, Ltd (NASDAQ: RCON) is the People's Republic of China's first NASDAQ-listed non-state owned oil and gas field service company. Recon supplies China's largest oil exploration companies, Sinopec (NYSE: SNP) and The China National Petroleum Corporation ("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 within several segmented markets of the oil and gas filed service industry. RCON also has developed stable long-term cooperation relationship with its major clients. For additional information please visit: http://www.recon.cn/

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 ¥1,769,840 and ¥1,269,146 ($173,872) from related parties as of June 30,

     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 ¥1,775,114 and ¥1,832,236 ($251,015) from related parties as of June 30, 2024

     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 ¥335,976 and ¥119,411 ($16,359) from related parties as of June 30, 2024

     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, $0.0001 US dollar par value, 500,000,000 shares authorized; 7,987,959 shares and 7,987,959 shares

     issued and outstanding as of June 30, 2024 and December 31, 2024, respectively



99,634



99,634



13,650

Class B Ordinary Shares, $0.0001 US dollar par value, 80,000,000 shares authorized; 7,100,000 shares and 20,000,000 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


The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

 

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


The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

 

 

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.

 

Cision View original content:https://www.prnewswire.com/news-releases/recon-technology-ltd-reports-financial-results-for-the-first-six-months-of-fiscal-year-2025-302415846.html

SOURCE Recon Technology, Ltd

FAQ

What caused RCON's revenue decline in H1 FY2025?

RCON's revenue declined 7.0% due to fluctuations in demand from new businesses and reduced environmental protection revenue following the expiration of Gansu BHD's hazardous waste permit.

How much did RCON's automation product revenue grow in H1 FY2025?

RCON's automation product and software revenue increased by RMB3.4 million ($0.5 million) or 19.2% due to growing market demand for automated operations.

What is RCON's planned chemical recycling plant timeline?

Construction of RCON's chemical recycling plant for low-value plastics is scheduled to begin in April 2025, with formal production expected to start in the second half of 2025.

How much cash does RCON have as of December 31, 2024?

RCON reported cash holdings of RMB145.3 million ($19.9 million) as of December 31, 2024.
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