UTime Announces Financial Results for The First Six Months of Fiscal Year 2023
UTime Limited (Nasdaq: UTME) reported its financial results for the six months ending September 30, 2022, revealing a revenue increase of 26.5% to approximately RMB127.8 million (US$18 million). The gross profit margin improved to 9.9%, up from 8.2%, due to higher sales of advanced mobile devices and lower raw material costs. However, net loss expanded by 67% to RMB15.6 million (US$2.2 million) due to increased operating expenses. Operating expenses rose 49% to approximately RMB24.3 million (US$3.4 million), influenced largely by R&D and general administrative costs. Cash and cash equivalents stood at US$10.5 million as of September 30, 2022.
- Revenue increased by 26.5% to approximately RMB127.8 million (US$18 million).
- Gross profit margin improved from 8.2% to 9.9%.
- Gross profit rose by 52.2% to approximately RMB12.6 million (US$1.8 million).
- Net loss increased by 67% to approximately RMB15.6 million (US$2.2 million).
- Operating expenses rose by 49% to approximately RMB24.3 million (US$3.4 million).
- General and administrative expenses surged by 153.1% to approximately RMB26.3 million (US$4 million).
NEW YORK, March 24, 2023 (GLOBE NEWSWIRE) -- UTime Limited (“UTime” or the “Company”) (Nasdaq: UTME), a mobile device manufacturing company committed to providing cost effective products and solutions to consumers globally and helping low-income individuals from established and emerging markets, have better access to updated mobile technology, today announced its financial results for the first six months of fiscal year 2023 ended September 30, 2022.
First Six Months of Fiscal Year 2023 Financial and Operational Highlights
All financial figures are in US Dollars unless otherwise noted.
- Revenue from Original Equipment Manufacturer (“OEM”) and Original Design Manufacturer (“ODM”) services increased from RMB100.2 million to approximately RMB127.7 million (US
$18.0 million ), representing a27.4% increase. - Gross profit margin increased from
8.2% to9.9% , primarily due to an increase in sales of newly introduced, higher end models of feature phones and smart phones, and a decrease in purchase price of key raw materials. - Net loss reached approximately RMB15.6 million (US
$2.2 million ), compared to net loss of RMB9.3 million during the same period last year, representing a67% increase. The increase in net loss was mainly due to an increase of selling expenses, R&D expenses and general and administration expenses, partially offset by an increase in gross profit. - The exchange rate between the RMB and US Dollar considerably affected the Company’s financial results, as more than
50% of our products were sold to customers outside of mainland China. Consequently, our revenue was affected by fluctuations in the exchange rate between US dollar and RMB.
First Six Months of Fiscal Year 2023 Financial Results
Revenue
Revenue for the six months ended September 30, 2022 was approximately RMB127.8 million (US
Cost of sales
Cost of sales for the six months ended September 30, 2022 was approximately RMB115.2 million (US
Gross profit for the six months ended September 30, 2022 was approximately RMB12.6 million (US
Overall gross profit margin for the six months ended September 30, 2022 was approximately
Operating Expenses
Operating expenses increased by RMB8 million, or
General and administrative expenses consist of salary and benefits to the Company’s accounting, human resources, design and executive office staff, rental expenses, property management and utilities, office supplies and other expenses. General and administrative expenses increased by RMB10.4 million, or
Selling expenses increased by RMB2.5 million, or
Other expenses (income), net for the six months ended September 30, 2022 was net income of RMB6.2 million (US
Income Before Tax
Income tax provision (benefit) was nil and RMB0.1 for the six months ended September 30, 2021 and 2022.
Net Income (loss)
Net loss was approximately RMB15.6 million (US
Cash and Cash Equivalents
As of September 30, 2022, the Company had cash and cash equivalents of US
Cash Flow
Net cash used in operating activities was RMB4.7 million (US
Net cash used in investing activities for six months ended September 30, 2022 was RMB2.2 million (US
Net cash provided by financing activities for six months ended September 30, 2022 was approximately RMB7.0 million (US
Exchange rate
Our reporting currency is the Renminbi. This announcement also contains translations of certain foreign currency amounts into U.S. dollars for the convenience of the reader. Unless otherwise stated, all translations of Renminbi into U.S. dollars were made at RMB7.0998 to US
UTIME LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share data and per share data, or otherwise noted)
As of March 31, | As of September 30, | |||||||||||
2022 | 2022 | |||||||||||
RMB | RMB | USD | ||||||||||
Assets | ||||||||||||
Current Assets | ||||||||||||
Cash and cash equivalents | 66,692 | 74,482 | 10,491 | |||||||||
Restricted cash | 500 | 500 | 70 | |||||||||
Accounts receivable, net | 22,417 | 33,887 | 4,773 | |||||||||
Prepaid expenses and other current assets, net | 65,815 | 83,871 | 11,813 | |||||||||
Due from related parties | 1,422 | 606 | 85 | |||||||||
Inventories | 36,071 | 19,043 | 2,682 | |||||||||
Total current assets | 192,917 | 212,389 | 29,914 | |||||||||
Non-Current assets | ||||||||||||
Property and equipment, net | 38,270 | 68,281 | 9,617 | |||||||||
Operating lease right-of-use assets, net | 16,319 | 14,561 | 2,051 | |||||||||
Intangible assets, net | 2,592 | 2,149 | 303 | |||||||||
Equity method investment | - | - | - | |||||||||
Other non-current assets | 541 | 526 | 74 | |||||||||
Total non-current assets | 57,722 | 85,517 | 12,045 | |||||||||
Total Assets | 250,639 | 297,906 | 41,959 | |||||||||
Liabilities and Shareholder’s equity | ||||||||||||
Current liabilities | ||||||||||||
Accounts payable | 74,531 | 114,436 | 16,118 | |||||||||
Short-term borrowings | 35,780 | 44,064 | 6,206 | |||||||||
Current portion of long-term borrowings | 800 | 1,080 | 152 | |||||||||
Due to related parties | 4,499 | 3,578 | 504 | |||||||||
Lease liability | 3,360 | 4,712 | 664 | |||||||||
Other payables and accrued liabilities | 44,148 | 51,435 | 7,245 | |||||||||
Income tax payables | 18 | 18 | 3 | |||||||||
Total current liabilities | 163,136 | 219,323 | 30,892 | |||||||||
Non-current liabilities | ||||||||||||
Long-term borrowings | 8,020 | 7,410 | 1,044 | |||||||||
Deferred revenue | - | 6,928 | 976 | |||||||||
Deferred tax liability | 466 | 381 | 54 | |||||||||
Lease liability - non-current | 14,549 | 11,438 | 1,611 | |||||||||
Total non-current liabilities | 23,035 | 26,157 | 3,685 | |||||||||
Total liabilities (including amounts of the consolidated VIEs without recourse to the Company of RMB183,641 and RMB240,994 as of March 31, 2022 and September 30, 2022, respectively) | 186,171 | 245,480 | 34,577 | |||||||||
Commitments and contingencies | ||||||||||||
Shareholder’s equity | ||||||||||||
Preferred share, par value US | ||||||||||||
Ordinary shares, par value US | 5 | 5 | 1 | |||||||||
Additional paid-in capital | 152,236 | 152,236 | 21,442 | |||||||||
Accumulated deficit | (88,277 | ) | (102,542 | ) | (14,443 | ) | ||||||
Accumulated other comprehensive income | 1,024 | 4,793 | 673 | |||||||||
Total UTime Limited shareholder’s equity | 64,988 | 54,492 | 7,673 | |||||||||
Non-controlling interests | (520 | ) | (2,066 | ) | (291 | ) | ||||||
Total shareholders’ equity | 64,468 | 52,426 | 7,382 | |||||||||
Total liabilities and shareholders’ equity | 250,639 | 297,906 | 41,959 |
UTIME LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Amounts in thousands, except share data and per share data, or otherwise noted)
Six months ended September 30, | ||||||||||||
2021 | 2022 | |||||||||||
RMB | RMB | USD | ||||||||||
Net sales | 101,057 | 127,792 | 17,999 | |||||||||
Cost of sales | 92,749 | 115,151 | 16,219 | |||||||||
Gross profit | 8,308 | 12,641 | 1,780 | |||||||||
Operating expenses: | ||||||||||||
Selling expenses | 1,661 | 4,194 | 591 | |||||||||
General and administrative expenses | 15,856 | 26,321 | 3,707 | |||||||||
Other expenses (income), net | (1,187 | ) | (6,249 | ) | (880 | ) | ||||||
Total operating expenses | 16,329 | 24,266 | 3,418 | |||||||||
Loss from operations | (8,021 | ) | (11,625 | ) | (1,638 | ) | ||||||
Interest expenses | 1,321 | 4,075 | 574 | |||||||||
Loss before income taxes | (9,342 | ) | (15,700 | ) | (2,212 | ) | ||||||
Income tax expenses (benefits) | - | (85 | ) | (12 | ) | |||||||
Net loss | (9,342 | ) | (15,615 | ) | (2,200 | ) | ||||||
Less: Net loss attributable to non-controlling interests | - | (1,350 | ) | (190 | ) | |||||||
Net loss attributable to UTime Limited | (9,342 | ) | (14,265 | ) | (2,010 | ) | ||||||
Comprehensive loss | ||||||||||||
Net loss | (9,342 | ) | (15,615 | ) | (2,200 | ) | ||||||
Foreign currency translation adjustment | 42 | 3,769 | 531 | |||||||||
Total comprehensive loss | (9,300 | ) | (11,846 | ) | (1,669 | ) | ||||||
Less: Comprehensive loss attributable to non-controlling interest | - | (1,350 | ) | (190 | ) | |||||||
Comprehensive loss attributable to UTime Limited | (9,300 | ) | (10,496 | ) | (1,479 | ) | ||||||
Loss per share attributable to UTime Limited | ||||||||||||
Basic and diluted | (1.14 | ) | (1.75 | ) | (0.25 | ) | ||||||
Weighted average ordinary shares outstanding | ||||||||||||
Basic and diluted | 8,164,771 | 8,164,771 | 8,164,771 |
UTIME LIMITED LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands or otherwise noted)
Six months ended September 30, | ||||||||||||
2021 | 2022 | |||||||||||
RMB | RMB | USD | ||||||||||
Cash flows from operating activities: | ||||||||||||
Net income (loss) | (9,342 | ) | (15,615 | ) | (2,200 | ) | ||||||
Adjustments to reconcile net income (loss) from operations to net cash used by operating activities | ||||||||||||
Depreciation and amortization | 2,276 | 2,602 | 366 | |||||||||
Allowances for obsolete inventories, net | 632 | (230 | ) | (32 | ) | |||||||
Provision for doubtful account, net | (161 | ) | - | - | ||||||||
Loss on disposal of property and equipment | 6 | 118 | 17 | |||||||||
Impairment of an intangible asset | 348 | - | - | |||||||||
Net changes in operating assets and liabilities: | ||||||||||||
Accounts receivable | (331 | ) | (6,183 | ) | (871 | ) | ||||||
Prepaid expenses and other current assets | (943 | ) | (1,133 | ) | (160 | ) | ||||||
Inventories | (38,601 | ) | 17,714 | 2,495 | ||||||||
Accounts payable | 36,317 | (2,697 | ) | (380 | ) | |||||||
Other payables and accrued liabilities | (9,781 | ) | (7,140 | ) | (1,006 | ) | ||||||
Related parties | - | 935 | 132 | |||||||||
Deferred revenue | - | 6,928 | 976 | |||||||||
Other non-current assets | - | 15 | 2 | |||||||||
Net cash (used in) provided by operating activities | (19,580) | (4,686 | ) | (661 | ) | |||||||
Investing activities: | ||||||||||||
Payment for property and equipment | (5,856 | ) | (2,057 | ) | (290 | ) | ||||||
Payment for intangible assets | (777 | ) | (147 | ) | (21 | ) | ||||||
Net cash used in investing activities | (6,633) | (2,204) | (311 | ) | ||||||||
Financing activities: | ||||||||||||
Proceeds from short-term borrowings | 15,500 | 19,310 | 2,720 | |||||||||
Loan received from a shareholder | 3,000 | 2,000 | 282 | |||||||||
Proceeds from long-term borrowings | 9,000 | - | - | |||||||||
Repayment of loan from a shareholder | - | (3,000 | ) | (423 | ) | |||||||
Repayment of short-term borrowings | (10,400 | ) | (11,026 | ) | (1,553 | ) | ||||||
Repayments of long-term borrowings | (5,640 | ) | (330 | ) | (46 | ) | ||||||
Down payment for financing services | (19,003 | ) | - | - | ||||||||
Contribution in a subsidiary by a shareholder | 6,429 | - | - | |||||||||
Proceeds from issuance of ordinary shares through initial public offering | 88,262 | - | - | |||||||||
Net cash provided by financing activities | 87,148 | 6,954 | 980 | |||||||||
Effect of exchange rate changes on cash and cash equivalent and restricted cash | (844 | ) | 7,726 | 1,089 | ||||||||
Net increase in cash and cash equivalent and restricted cash | 60,091 | 7,790 | 1,097 | |||||||||
Cash and cash equivalents and restricted cash at beginning of period | 9,477 | 67,192 | 9,464 | |||||||||
Cash and cash equivalents and restricted cash at end of period | 69,568 | 74,982 | 10,561 |
FAQ
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