Exhibit 99.3
Recon Technology Announces 143% Increase in Third Quarter Revenue
BEIJING, May 15, 2014 /PRNewswire/ -- Recon Technology, Ltd. (Nasdaq: RCON) ("Recon" or the "Company"), a Chinese non-state-owned oilfield services provider to oil and gas companies and their affiliates, today reported results for its third quarter of fiscal 2014 ended March 31, 2014.
Three Month Financial Highlights:
- Total revenue for the three months ended March 31, 2014 increased 143% to RMB 18.23 million ($2.96 million).
- Gross profit for the three months ended March 31, 2014 increased 26.22% to RMB 5.24 million ($0.85 million).
- Operating loss was RMB 0.6 million ($92,000), narrowed by 73.7% compared to an operating loss of RMB 2.15 million for the three months ended March 31, 2013.
- Net loss attributable to ordinary shareholders for the three months ended March 31, 2014 was RMB 1.93 million ($0.31 million), or RMB 0.43 ($0.07) per diluted share, as compared to net loss attributable to ordinary shareholders for the same period of FY2013 of RMB 1.25 million, or a loss of RMB 0.32 per diluted share.
- The non-GAAP EPS for the three months ended March 31, 2014 was a loss of RMB 0.03 per share, as compared to non-GAAP EPS for the same period of FY 2013 of a loss of RMB 0.2 per share.
- Adjusted EBITDA improved by approximately RMB 0.7 million ($0.1 million) to approximately RMB 0.5 million ($0.1 million) for the three months ended March 31, 2014 compared to a loss of approximately RMB 0.2 million loss for the same period in 2013.
Nine Month Financial Highlights
- Total revenue for the nine months ended March 31, 2014 increased 21.5% to RMB 76 million ($12.3 million).
- Gross profit for the nine months ended March 31, 2014 increased 31.23% to RMB 27 million ($4.4 million).
- Operating profit was RMB7.83 million ($1.27 million), up 558.16% compared to an operating income of RMB1.19 million for the nine months ended March 31, 2013.
- Net profit attributable to ordinary shareholders for the nine months ended March 31, 2014 was RMB 3.93 million ($0.64 million), or RMB 0.92 ($0.15) per diluted share, as compared to net income attributable to ordinary shareholders for the same period of FY2013 of RMB 1.70 million, or RMB 0.43 per diluted share.
- Adjusted EBITDA improved by approximately RMB 6.1 million ($1.0 million) to approximately RMB 11.7 million ($1.9 million) for the nine months ended March 31, 2014 compared to approximately RMB 5.6 million income for the same period in 2013.
- The non-GAAP earnings per share is RMB 1.82, as compared to non-GAAP earnings per share for the nine months ended March 31, 2013 of RMB 0.77.
"Year to date in FY2014, we are very pleased to see our operating efficiency has continued to improve, which is reflected in our overall nine month financial data." said Mr. Yin Shenping, CEO of Recon. "The third quarter is the off-season of our company, and we also bore more noncash expenses. Thus, while our third quarter financial results are lower than our second quarter, they are improved from third quarter 2013, with our increasing on-site maintenance skills, we believe that our footprint will continue to grow in the heating furnace and the automation business, and our business will continue to increase."
Mr. Yin continued: "Since our IPO in 2009, we have successfully expanded our market penetration, such as in Jilin oilfield. In April 2014, Recon Technology attended Sinopec seminars on an upcoming shale gas project. This shale gas project will mark the first large-scale commercial shale gas development in China. This conference, which featured a number of likely bidders in the South Fuling shale gas project, mainly focused on heating separators, horizontal fracturing technology and its technical application issues. Recon's Chief Technology Officer, Mr. Guangqiang Chen, introduced Recon's heating furnaces, separators and horizontal fracturing technology at the conference. As we continue to capitalize on our position in China's fragmented oil services industry and broaden our integrated products and service offerings through R&D and collaboration with Chinese and international companies involved in the oilfield services industry, we believe Recon is well-positioned to continue to grow."
Q3 FY2014 Financial Results:
Our total revenues increased by 143%, or approximately RMB 10.7 million ($1.7 million), from approximately RMB 7.5 million for the three months ended March 31, 2013 to RMB 18.2 million ($3 million) for the same period of 2014. The increase in revenue was mainly attributable to automation products from the Southwest branch of Sinopec and sales of furnaces from Jilin oilfield.
Gross profit increased to approximately RMB 5.2 million ($0.9 million) for the three months ended March 31, 2014 from approximately RMB 4.2 million for the same period in 2013. Our gross profit as a percentage of revenue decreased to 28.8% for the three months ended March 31, 2014 from 55.4% for the same period in 2013. This was mainly because lower margin hardware revenues increased during the three months ended March 31, 2014 compared to the same period last year and higher margin software revenues decreased during the three months ended March 31, 2014.
Selling expenses decreased by 38.7%, from approximately RMB 1.8 million for the three months ended March 31, 2013 to approximately RMB 1.1 million ($0.2 million) for the same period of 2014. This decrease was primarily from the decreased traveling expenses, bidding fee, salaries and maintenance expenses. Selling expenses were 23.9% of total revenues in the three months ended March 31, 2013 and 6% of total revenues in the same period of 2014.
Loss from operations was approximately RMB 0.6 million ($0.1 million) for the three months ended March 31, 2014, compared to loss of RMB 2.2 million for the same period of 2013. This decrease in loss from operations can be attributed primarily to the increased revenue, gross margins and decreases in research and development expenses.
As a result of the factors described above, net loss attributable to ordinary shareholders was approximately RMB 1.9 million ($0.3 million) for the three months ended March 31, 2014, an increase of approximately RMB 0.7 million ($0.1 million) from net loss attributable to ordinary shareholders of RMB1.2 million for the same period of 2013. This was due to increased noncash expense and warrant liability.
Adjusted EBITDA improved by approximately RMB 0.7 million ($0.1 million) to approximately RMB 0.5 million ($0.1 million) for the three months ended March 31, 2014 compared to approximately RMB 0.2 million loss for the same period in 2013. This was due to we increased more noncash expense and warrant liability.
The non-GAAP earnings per share for the third quarter is a loss of RMB 0.03, as compared to non-GAAP earnings per share for the same period of FY2013 of a loss of RMB 0.2.
Year-to-Date FY2013 Financial Results:
Our total revenues increased by 21.5%, or approximately RMB 13.5 million ($2.2 million), from RMB 62.5 million for the nine months ended March 31, 2013 to RMB 76.0 million ($12.3 million) for the same period of 2014. The increase in revenues for the nine-month period was due to sale of furnaces and automation products.
Gross profit increased to approximately RMB 27.1 million ($4.4 million) for the nine months ended March 31, 2014 from approximately RMB 20.6 million for the same period in 2013. Gross profit as a percentage of revenue increased to 35.6% for the nine months ended March 31, 2014 from 33.0% for the same period in 2013. This was mainly because fracturing service with lower margin accounted for a major part of our revenue during the nine months ended March 31, 2013. As to our automation business and furnaces business, our margins were both improved because our products and services were also popular with our clients, especially our newly developed clients.
Selling expenses were flat at RMB 4.7 million ($0.8 million) for the nine months ended March 31, 2013 and 2014. Selling expenses were 7.5% of total revenues in the nine months ended March 31, 2013 and 6.2% of total revenues in the same period of 2014.
Income from operations was approximately RMB 7.8 million ($1.3 million) for the nine months ended March 31, 2014, compared to income of RMB 1.2 million for the same period of 2013. This increase in income from operations can be attributed primarily to the increased revenue, gross margins and decreases in research and development expenses.
As a result of the factors described above, net income attributable to ordinary shareholders was approximately RMB 3.9 million ($0.6 million) for the nine months ended March 31, 2014, an increase of approximately RMB 2.2 million ($0.4 million) from net income attributable to ordinary shareholders of RMB 1.7 million for same period of 2013.
Adjusted EBITDA improved by approximately RMB 6.1 million ($1.0 million) to approximately RMB 11.7 million ($1.9 million) for the nine months ended March 31, 2014 compared to approximately RMB 5.6 million income for the same period in 2013.
The non-GAAP earnings per share is RMB 1.82, more than doubled compared to non-GAAP earnings per share for the nine months ended March 31, 2013 of RMB 0.77.
Net cash used in operating activities was approximately RMB 15.3 million ($2.5 million) for the nine months ended March 31, 2014. This was a decrease of approximately RMB 32.6 million ($5.3 million) compared to net cash provided by operating activities of approximately RMB 17.3 million for the nine months ended March 31, 2013.
Net cash used in investing activities was approximately RMB 0.2 million ($26,000) for the nine months ended March 31, 2014, a decrease of RMB 0.3 million ($58,000) from RMB 0.5 million for the same period of 2013. The decrease was due to a decrease in the purchase of property and equipment. The decrease was because we purchase less property and equipment.
Net cash provided by financing activities amounted to approximately RMB 11.9 million ($1.9 million) for the nine months ended March 31, 2014, compared to cash flows used in financing activities of approximately RMB 14.1 million for the same period in 2013. During the nine-month period ended March 31, 2014, we received net proceeds of RMB 12.1 million ($2.0 million) from a common stock sale of 546,500 shares with institutional investors in November 2013. In addition, we repaid RMB 12.87 million ($2.1 million) short term borrowings to related parties and received RMB 18.5 million ($3.0 million) of net loan proceeds from a commercial bank, which was guaranteed by one of our shareholders.
About Recon
Recon Technology, Ltd. is China's first listed non-state owned oil and gas field service company on Nasdaq (RCON). Recon supplies China's largest oil exploration companies, Sinopec and 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 on several segmented markets of the oil and gas filed service industry. RCON also has developed stable long-term cooperation relationship with its major clients, and its products and service are also well accepted by clients. For additional information please visit us at www.recon.cn.
| RECON TECHNOLOGY, LTD |
| UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
| | | | | | | | | |
| | | As of June 30, | | | As of March 31, | | | As of March 31, |
| | 2013 | | 2014 | | 2014 |
| ASSETS | RMB | | RMB | | U.S. Dollars |
| Current assets | | | | | | | | |
| Cash and cash equivalents | RMB | 12,350,392 | | RMB | 8,863,889 | | $ | 1,438,499 |
| Notes receivable | | 2,578,855 | | | - | | | - |
| Trade accounts receivable, net | | 38,648,780 | | | 55,808,726 | | | 9,057,065 |
| Trade accounts receivable- related parties, net | | 18,744,364 | | | 16,794,476 | | | 2,725,535 |
| Inventories, net | | 13,271,070 | | | 22,094,753 | | | 3,585,705 |
| Other receivables, net | | 19,131,503 | | | 15,970,126 | | | 2,591,754 |
| Other receivables- related parties | | 742,528 | | | 664,831 | | | 107,894 |
| Purchase advances, net | | 18,412,507 | | | 23,480,982 | | | 3,810,672 |
| Purchase advances- related parties | | 394,034 | | | 394,034 | | | 63,947 |
| Tax recoverable | | 575,650 | | | - | | | - |
| Prepaid expenses | | 2,853,956 | | | 3,434,100 | | | 557,311 |
| Deferred tax asset | | 1,006,721 | | | 1,082,436 | | | 175,666 |
| Total current assets | | 128,710,360 | | | 148,588,353 | | | 24,114,048 |
| | | | | | | | | |
| Property and equipment, net | | 1,709,846 | | | 1,345,742 | | | 218,397 |
| Long-term investment | | 1,549,450 | | | 674,792 | | | 109,510 |
| Long-term other receivable | | 3,502,680 | | | 5,993,198 | | | 972,622 |
| Total Assets | RMB | 135,472,336 | | RMB | 156,602,085 | | $ | 25,414,577 |
| | | | | | | | | |
| LIABILITIES AND EQUITY | | | | | | | | |
| Current liabilities | | | | | | | | |
| Short-term bank loans | RMB | 10,000,000 | | RMB | 15,630,000 | | $ | 2,536,555 |
| Trade accounts payable | | 7,384,165 | | | 13,595,942 | | | 2,206,453 |
| Trade accounts payable- related parties | | 3,994,718 | | | - | | | - |
| Other payables | | 1,964,691 | | | 1,773,163 | | | 287,762 |
| Other payable- related parties | | 4,239,675 | | | 3,382,337 | | | 548,911 |
| Deferred revenue | | 3,381,382 | | | 4,326,473 | | | 702,133 |
| Advances from customers | | 470,700 | | | 275,600 | | | 44,726 |
| Accrued payroll and employees' welfare | | 1,992,783 | | | 389,443 | | | 63,202 |
| Accrued expenses | | 488,730 | | | 246,113 | | | 39,942 |
| Taxes payable | | 6,754,428 | | | 7,909,731 | | | 1,283,651 |
| Short-term borrowings- related parties | | 5,503,279 | | | 200,000 | | | 32,458 |
| Short-term borrowings- other | | 570,375 | | | - | | | - |
| Warrants liability | | - | | | 5,992,127 | | | 972,448 |
| Total current liabilities | | 46,744,926 | | | 53,720,929 | | | 8,718,241 |
| | | | | | | | | |
| Commitments and Contingency | | | | | | | | |
| | | | | | | | | |
| Equity | | | | | | | | |
| Common stock, ($ 0.0185 U.S. dollar par value, 25,000,000 shares authorized; 3,951,811 and 4,528,311 shares issued and outstanding as of June 30, 2013 and March 31, 2014, respectively) | | 529,979 | | | 595,335 | | | 96,613 |
| Additional paid-in capital | | 69,516,447 | | | 78,669,718 | | | 12,767,120 |
| Appropriated retained earnings | | 3,023,231 | | | 4,868,048 | | | 790,024 |
| Unappropriated retained earnings | | 8,749,963 | | | 10,835,662 | | | 1,758,494 |
| Accumulated other comprehensive loss | | (293,201) | | | (326,126) | | | (52,925) |
| Total controlling shareholders' equity | | 81,526,419 | | | 94,642,637 | | | 15,359,326 |
| Non-controlling interest | | 7,200,991 | | | 8,238,519 | | | 1,337,010 |
| Total equity | | 88,727,410 | | | 102,881,156 | | | 16,696,336 |
| Total Liabilities and Equity | RMB | 135,472,336 | | RMB | 156,602,085 | | $ | 25,414,577 |
| | | | | | | | | |
| | | | | | | | | |
| The accompanying notes are an integral part of these unaudited condensed consolidated financial statements |
| RECON TECHNOLOGY, LTD |
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) |
| | | | | | | | | | | | | | | | | | |
| | For the nine months ended | | For the three months ended |
| | March 31, | | March 31, |
| | | 2013 | | | 2014 | | 2014 | | | 2013 | | | 2014 | | 2014 |
| | | RMB | | | RMB | | USD | | | RMB | | | RMB | | USD |
| | | | | | | | | | | | | | | | | | |
| Revenues | | | | | | | | | | | | | | | | | |
| Hardware and software | RMB | 35,959,339 | | RMB | 73,337,585 | | $ | 11,901,781 | | RMB | 4,161,583 | | RMB | 17,998,444 | | $ | 2,920,924 |
| Service | | 20,567,637 | | | 477,769 | | | 77,536 | | | 62,678 | | | 80,180 | | | 13,012 |
| Hardware and software - related parties | | 6,009,611 | | | 2,196,152 | | | 356,408 | | | 3,277,534 | | | 153,846 | | | 24,967 |
| Total revenues | | 62,536,587 | | | 76,011,506 | | | 12,335,725 | | | 7,501,795 | | | 18,232,470 | | | 2,958,903 |
| | | | | | | | | | | | | | | | | | |
| Hardware and software | RMB | 23,033,622 | | RMB | 48,447,792 | | $ | 7,862,476 | | RMB | 2,527,534 | | RMB | 12,848,136 | | $ | 2,085,093 |
| Service | | 15,743,234 | | | 77,107 | | | 12,514 | | | 20,620 | | | 42,161 | | | 6,842 |
| Hardware and software - related parties | | 3,139,082 | | | 426,139 | | | 69,157 | | | 798,190 | | | 97,217 | | | 15,777 |
| Total cost of revenues | | 41,915,938 | | | 48,951,038 | | | 7,944,147 | | | 3,346,344 | | | 12,987,514 | | | 2,107,712 |
| Gross profit | | 20,620,649 | | | 27,060,468 | | | 4,391,578 | | | 4,155,451 | | | 5,244,956 | | | 851,191 |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| Selling and distribution expenses | | 4,693,193 | | | 4,701,989 | | | 763,075 | | | 1,790,199 | | | 1,097,549 | | | 178,119 |
| General and administrative expenses | | 8,452,540 | | | 10,450,904 | | | 1,696,052 | | | 3,966,782 | | | 3,993,341 | | | 648,070 |
| Research and development expenses | | 6,284,834 | | | 4,074,953 | | | 661,314 | | | 552,645 | | | 720,956 | | | 117,002 |
| Operating expenses | | 19,430,567 | | | 19,227,846 | | | 3,120,441 | | | 6,309,626 | | | 5,811,846 | | | 943,191 |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| Income (loss) from operations | | 1,190,082 | | | 7,832,622 | | | 1,271,137 | | | (2,154,175) | | | (566,890) | | | (92,000) |
| | | | | | | | | | | | | | | | | | |
| Other income (expenses) | | | | | | | | | | | | | | | | | |
| Subsidy income | | 2,143,669 | | | 1,220,024 | | | 197,995 | | | 1,343,669 | | | 201,711 | | | 32,735 |
| Interest income | | 443,391 | | | 296,997 | | | 48,199 | | | 137,803 | | | 92,027 | | | 14,935 |
| Interest expense | | (1,494,887) | | | (757,226) | | | (122,888) | | | (618,473) | | | (277,578) | | | (45,047) |
| Loss from investment | | - | | | (870,627) | | | (141,292) | | | - | | | (135,547) | | | (21,998) |
| Change in fair value of warrants liability | | - | | | (904,327) | | | (146,761) | | | - | | | (904,883) | | | (146,851) |
| Gain (loss) from foreign currency exchange | | 339,876 | | | (88,080) | | | (14,294) | | | (185) | | | 31,312 | | | 5,082 |
| Other income (expense) | | (19,158) | | | (143,498) | | | (23,288) | | | (109,881) | | | (99,552) | | | (16,156) |
| | | | | | | | | | | | | | | | | | |
| Income (loss) before income tax | | 2,602,973 | | | 6,585,885 | | | 1,068,808 | | | (1,401,242) | | | (1,659,400) | | | (269,300) |
| Provision for income tax | | 302,550 | | | 1,609,976 | | | 261,279 | | | (152,382) | | | 150,787 | | | 24,471 |
| Net Income (loss) | | 2,300,423 | | | 4,975,909 | | | 807,529 | | | (1,248,860) | | | (1,810,187) | | | (293,771) |
| | | | | | | | | | | | | | | | | | |
| Less: Net income attributable to non-controlling interest | | 602,961 | | | 1,045,396 | | | 169,655 | | | (2,127) | | | 120,415 | | | 19,542 |
| Net Income attributable to Recon Technology, Ltd | RMB | 1,697,462 | | RMB | 3,930,513 | | $ | 637,874 | | RMB | (1,246,733) | | RMB | (1,930,602) | | $ | (313,313) |
| | | | | | | | | | | | | | | | | | |
| Comprehensive income (loss) | | | | | | | | | | | | | | | | | |
| Net income | | 2,300,423 | | | 4,975,909 | | | 807,529 | | | (1,248,860) | | | (1,810,187) | | | (293,771) |
| Foreign currency translation adjustment | | (16,889) | | | (40,833) | | | (6,627) | | | (717) | | | (118,110) | | | (19,168) |
| Comprehensive income (loss) | | 2,283,534 | | | 4,935,076 | | | 800,902 | | | (1,249,577) | | | (1,928,297) | | | (312,939) |
| Less: Comprehensive income attributable to non-controlling interest | | 601,084 | | | 1,041,313 | | | 168,992 | | | (2,207) | | | 108,604 | | | 17,625 |
| Comprehensive income (loss) attributable to Recon Technology, Ltd | RMB | 1,682,450 | | RMB | 3,893,763 | | $ | 631,910 | | RMB | (1,247,370) | | RMB | (2,036,901) | | $ | (330,564) |
| | | | | | | | | | | | | | | | | | |
| Earnings (loss) per common share - basic | RMB | 0.43 | | RMB | 0.93 | | $ | 0.15 | | RMB | (0.32) | | RMB | (0.43) | | $ | (0.07) |
| Earnings (loss) per common share - diluted | RMB | 0.43 | | RMB | 0.92 | | $ | 0.15 | | RMB | (0.32) | | RMB | (0.43) | | $ | (0.07) |
| Weighted - average shares -basic | | 3,951,811 | | | 4,211,785 | | | 4,211,785 | | | 3,951,811 | | | 4,528,311 | | | 4,528,311 |
| Weighted - average shares -diluted | | 3,951,811 | | | 4,269,510 | | | 4,269,510 | | | 3,951,811 | | | 4,528,311 | | | 4,528,311 |
| | | | | | | | | | | | | | | | | | |
| The accompanying notes are an integral part of these unaudited condensed consolidated financial statements |
| RECON TECHNOLOGY, LTD |
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
| | | | | | | | | |
| | For the nine months ended March 31, |
| | 2013 | | 2014 | | 2014 |
| | RMB | | RMB | | U.S. Dollars |
| | | | | | | | | |
| Cash flows from operating activities: | | | | | | | | |
| Net income | RMB | 2,300,423 | | RMB | 4,975,909 | | $ | 807,529 |
| Adjustments to reconcile net income to net cash provided by (used in) operating activities: | | | | | | | | |
| Depreciation | | 467,914 | | | 457,439 | | | 74,237 |
| Loss from disposal of equipment | | 26,845 | | | 67,587 | | | 10,969 |
| Provision/(recovery of) for doubtful accounts | | (82,420) | | | 668,610 | | | 108,507 |
| Share based compensation | | 1,358,726 | | | 1,660,144 | | | 269,421 |
| Loss from investment | | - | | | 870,627 | | | 141,292 |
| Deferred tax provision/(benefit) | | 12,363 | | | (75,715) | | | (12,288) |
| Change in fair value of warrants liability | | - | | | 904,327 | | | 146,761 |
| Restricked shares issued to consulting firm | | - | | | 407,972 | | | 66,209 |
| Changes in operating assets and liabilities: | | | | | | | | |
| Trade accounts receivable | | 13,156,606 | | | (17,127,239) | | | (2,779,539) |
| Trade accounts receivable-related parties | | 2,701,259 | | | 1,487,501 | | | 241,403 |
| Notes receivable | | - | | | 2,578,855 | | | 418,516 |
| Inventories | | 9,397,201 | | | (8,823,683) | | | (1,431,974) |
| Other receivable, net | | (4,641,896) | | | 688,724 | | | 111,770 |
| Other receivables related parties, net | | (1,038,967) | | | 77,697 | | | 12,609 |
| Purchase advance, net | | (5,597,453) | | | (5,325,269) | | | (864,225) |
| Purchase advance-related party, net | | (300,500) | | | - | | | - |
| Tax recoverable | | 2,790,722 | | | 575,650 | | | 93,421 |
| Prepaid expense | | (274,350) | | | (580,144) | | | (94,150) |
| Trade accounts payable | | (5,643,032) | | | 6,211,777 | | | 1,008,094 |
| Trade accounts payable-related parties | | 110,157 | | | (3,994,718) | | | (648,293) |
| Other payables | | (51,139) | | | (191,528) | | | (31,083) |
| Other payables-related parties | | 4,899,620 | | | (857,338) | | | (139,135) |
| Deferred income | | (155,169) | | | 945,091 | | | 153,377 |
| Advances from customers | | 244,996 | | | (195,100) | | | (31,662) |
| Accrued payroll and employees' welfare | | 713,859 | | | (1,603,340) | | | (260,202) |
| Accrued expenses | | (133,253) | | | (242,617) | | | (39,374) |
| Taxes payable | | (2,988,030) | | | 1,155,303 | | | 187,491 |
| Net cash provided by (used in) operating activities | | 17,274,482 | | | (15,283,478) | | | (2,480,319) |
| | | | | | | | | |
| Cash flows from investing activities: | | | | | | | | |
| Purchase of property and equipment | | (676,504) | | | (258,922) | | | (42,020) |
| Proceeds from disposal of equipment | | 161,000 | | | 98,000 | | | 15,904 |
| Net cash used in investing activities | | (515,504) | | | (160,922) | | | (26,116) |
| | | | | | | | | |
| Cash flows from financing activities: | | | | | | | | |
| Proceeds from short-term bank loans | | 8,350,000 | | | 18,500,000 | | | 3,002,321 |
| Repayments of short-term bank loans | | (21,652,952) | | | (12,870,000) | | | (2,088,641) |
| Proceeds from borrowings-related parties | | 3,658,102 | | | - | | | - |
| Repayment of short-term borrowings | | (2,275,764) | | | (570,375) | | | (92,565) |
| Repayment of short-term borrowings-related parties | | (2,232,477) | | | (5,303,279) | | | (860,656) |
| Proceeds from sale of common stock, net of issuance costs | | - | | | 12,132,882 | | | 1,969,016 |
| Capital contribution in VIE | | 20,000 | | | - | | | - |
| Net cash provided by (used in) financing activities | | (14,133,091) | | | 11,889,228 | | | 1,929,475 |
| | | | | | | | | |
| Effect of exchange rate fluctuation on cash and cash equivalents | | 293,521 | | | 68,669 | | | 11,143 |
| | | | | | | | | |
| Net increase (decrease) in cash and cash equivalents | | 2,919,408 | | | (3,486,503) | | | (565,817) |
| Cash and cash equivalents at beginning of period | | 3,533,283 | | | 12,350,392 | | | 2,004,316 |
| Cash and cash equivalents at end of period | RMB | 6,452,691 | | RMB | 8,863,889 | | $ | 1,438,499 |
| | | | | | | | | |
| | | | | | | | | |
| Supplemental cash flow information | | | | | | | | |
| Cash paid during the period for interest | RMB | 1,356,581 | | RMB | 952,125 | | $ | 154,518 |
| Cash paid during the period for taxes | RMB | 832,028 | | RMB | 700,268 | | $ | 113,645 |
| | | | | | | | | |
| The accompanying notes are an integral part of these unaudited condensed consolidated financial statements |
Safe Harbor
This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in reports filed by the company with the Securities and Exchange Commission.
All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.
Company Contact
Liu Jia
Recon Technology, Ltd.
+86 (10) 84945799
info@recon.cn
Investors
Jimmy Caplan
Asia IR/PR
+1-512-329-9505
jimmy@asia-irpr.com
Media
Rick Eisenberg
Asia IR/PR
+1-212-496-6828
rick@asia-irpr.com
