Exhibit 99.1
Dragon Victory International Limited
Consolidated Financial Statements
September 30, 2019 and 2018
(Stated in U.S. Dollars)
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Dragon Victory International Limited and Subsidiaries
Consolidated Balance Sheets
September 30, 2019 | March 31, 2019 | |||||||
ASSETS | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 13,564 | $ | 38,600 | ||||
Trade accounts receivable, net | 940,028 | 1,727,645 | ||||||
Other receivables and prepayments | 814,144 | 621,232 | ||||||
Short-term investments | 8,759,219 | 9,461,918 | ||||||
Total current assets | 10,526,955 | 11,849,395 | ||||||
Non-current assets | ||||||||
Property, plant and equipment, net | 277,096 | 377,701 | ||||||
Intangible assets, net | 673 | 927 | ||||||
Other assets | 80,976 | 86,102 | ||||||
TOTAL ASSETS | 10,885,700 | 12,314,125 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities | ||||||||
Accounts payable | 21,299 | 13,320 | ||||||
Taxes payable | 1,700,330 | 1,794,570 | ||||||
Accrued liabilities and other current liabilities | 409,832 | 981,461 | ||||||
Related party payable | 67,433 | 60,483 | ||||||
Capital lease – current portion | 75,497 | 80,276 | ||||||
Total current liabilities | 2,274,391 | 2,930,110 | ||||||
Capital lease – non-current portion | 25,166 | 66,897 | ||||||
TOTAL LIABILITIES | 2,299,557 | 2,997,007 | ||||||
COMMITMENTS & CONTINGENCIES | ||||||||
Stockholders' Equity | ||||||||
Ordinary Shares, $0.0001 par value, 500,000,000 shares authorized; 11,421,393 and 10,000,000 shares issued and outstanding, respectively | 1,142 | 1,142 | ||||||
Additional paid-in capital | 8,929,968 | 8,929,968 | ||||||
Statutory reserves | 589,659 | 589,659 | ||||||
Retained earnings | 565,603 | 663,695 | ||||||
Accumulated other comprehensive income | (1,000,336 | ) | (377,581 | ) | ||||
Total Stockholders’ equity | 9,086,036 | 9,806,883 | ||||||
Noncontrolling interest | (499,893 | ) | (489,765 | ) | ||||
TOTAL EQUITY | 8,586,143 | 9,317,118 | ||||||
TOTAL LIABILITIES AND STOCHOLDERS' EQUITY | $ | 10,885,700 | $ | 12,314,125 |
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Dragon Victory International Limited and Subsidiaries
Consolidated Statements of Operations (Loss) Income and Comprehensive (Loss) Income
For the six months ended September 30, | ||||||||
2019 | 2018 | |||||||
Revenues | $ | 699,371 | $ | 2,336,132 | ||||
Operating expenses | ||||||||
Selling, general and administrative expenses | 866,884 | 2,018,154 | ||||||
(Loss) income from operations | (167,513 | ) | 317,978 | |||||
Other income (expenses): | ||||||||
Other income | 4,527 | 14,157 | ||||||
Other expenses | (5,454 | ) | (9,818 | ) | ||||
Interest income | 46,172 | 338,570 | ||||||
Interest expense | (15,147 | ) | (1,240 | ) | ||||
Total other income (expenses) | 30,098 | 341,669 | ||||||
(Loss) income before tax | (137,415 | ) | 659,647 | |||||
Income tax | 491 | - | ||||||
Net (loss) income including noncontrolling interest | (137,906 | ) | 659,647 | |||||
Less: loss attributable to noncontrolling interest | (39,814 | ) | (69,005 | ) | ||||
Net (loss) income attributable to Dragon Victory | $ | (98,092 | ) | $ | 728,652 | |||
Other comprehensive income (loss): | ||||||||
Foreign currency translation loss | (593,069 | ) | (148,792 | ) | ||||
Comprehensive (loss) income including noncontrolling interest | $ | (730,975 | ) | $ | 579,860 | |||
Comprehensive loss attributable to noncontrolling interest | $ | (10,128 | ) | $ | (69,005 | ) | ||
Comprehensive (loss) income attributable to Dragon Victory | $ | (720,847 | ) | $ | 579,860 | |||
(Loss) earnings per share attributable to Dragon Victory common stockholders | ||||||||
Basic | $ | (0.01 | ) | $ | 0.06 | |||
Diluted | $ | (0.01 | ) | $ | 0.06 | |||
Weighted average shares outstanding-Dragon Victory | ||||||||
Basic | 11,421,393 | 11,421,393 | ||||||
Diluted | 11,421,393 | 11,421,393 |
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Dragon Victory International Limited and Subsidiaries
Consolidated Statements of Cash Flows
For the six months ended September 30, | ||||||||
2019 | 2018 | |||||||
Cash flows from operating activities | ||||||||
Net (loss) income including noncontrolling interest | (137,906 | ) | 659,647 | |||||
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities | ||||||||
Depreciation and amortization | 70,708 | 45,689 | ||||||
Changes in assets and liabilities | ||||||||
Decrease (increase) in accounts receivables | 706,281 | (1,170,646 | ) | |||||
(Increase)/decrease in other receivables and prepayments | (237,123 | ) | 312,680 | |||||
(Decrease)/increase in accounts, taxes, and other payables | (497,579 | ) | 264,357 | |||||
Net cash (used in)/provided by operating activities | (95,619 | ) | 111,727 | |||||
Cash flows from investing activities | ||||||||
Maturity of investments | 143,759 | - | ||||||
Purchase of equipment and improvements | - | (10,519 | ) | |||||
Purchase of intangible assets | - | (479 | ) | |||||
Net cash (used in)/provided by investing activities | 143,759 | (10,998 | ) | |||||
Cash flows from financing activities | ||||||||
Increase (decrease) in related party payable | 9,489 | 128,727 | ||||||
Increase in related party receivables | - | (2,316,346 | ) | |||||
Net cash provided by/(used in) financing activities | 9,489 | (2,187,619 | ) | |||||
Net Increase/(decrease) of Cash and Cash Equivalents | 57,629 | (2,086,890 | ) | |||||
Effect of foreign currency translation on cash and cash equivalents | (82,665 | ) | (115,563 | ) | ||||
Cash and cash equivalents–beginning of year | 38,600 | 3,937,490 | ||||||
Cash and cash equivalents–end of year | 13,564 | 1,735,037 | ||||||
Supplemental cash flow disclosures | ||||||||
Interest received | 46,172 | 338,570 | ||||||
Interest paid | 15,147 | 1,240 | ||||||
Income taxes paid | 491 | 285,749 |
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Dragon Victory International Limited and Subsidiaries
Consolidated Statements of Stockholders’ Equity
Ordinary Shares | Accumulated | |||||||||||||||||||||||||||||||
$0.0001 Par Value | Additional Paid-in | Statutory | Retained | Other Comprehensive | Noncontrolling | |||||||||||||||||||||||||||
Shares | Amount | Capital | Reserves | Earnings | Income | Interest | Totals | |||||||||||||||||||||||||
Balances at March 31, 2018 | 11,421,393 | $ | 1,142 | $ | 8,929,968 | $ | 433,479 | $ | 1,876,235 | $ | (168,541 | ) | $ | (78,790 | ) | $ | 10,993,493 | |||||||||||||||
Net income (loss) | (1,056,360 | ) | (403,410 | ) | (1,459,770 | ) | ||||||||||||||||||||||||||
Appropriations of retained earnings | 156,180 | (156,180 | ) | - | ||||||||||||||||||||||||||||
Cumulative translation adjustment | (209,040 | ) | (7,565 | ) | (216,605 | ) | ||||||||||||||||||||||||||
Balances at March 31, 2019 | 11,421,393 | $ | 1,142 | $ | 8,929,968 | $ | 589,659 | $ | 663,695 | $ | (377,581 | ) | $ | (489,765 | ) | $ | 9,317,118 | |||||||||||||||
Net income (loss) | (98,092 | ) | (39,814 | ) | (137,906 | ) | ||||||||||||||||||||||||||
Cumulative translation adjustment | (622,755 | ) | 29,686 | (593,069 | ) | |||||||||||||||||||||||||||
Balances at September 30, 2019 | 11,421,393 | $ | 1,142 | $ | 8,929,968 | $ | 589,659 | 565,603 | (1,000,336 | ) | (499,893 | ) | 8,586,143 |
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