Zhongchao 6K Report of Foreign Private Issuer | ZCMD 16 Dec 22

Exhibit 99.1

ZHONGCHAO INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

As of June 30, 2022 and December 31, 2021

(Expressed in U.S. dollar, except for the number of shares and per share data)

	June 30, 2022			December 31, 2021

ASSETS
Current Assets
Cash and cash equivalents	$	11,481,357		$	13,914,982
Short-term investments		524,396			296,158
Accounts receivable, net		9,682,387			9,218,883
Prepayments		1,162,235			394,971
Loans receivable		2,437,895			2,660,668
Due from affiliates		2,533,592			392,305
Other current assets		280,142			375,709
Total Current Assets		28,102,004			27,253,676

Investment in equity method investees		1,836,693			1,993,285
Investment in an equity security		150,000			150,000
Prepayments for a long-term investment		597,193			-
Property and equipment, net		3,597,987			3,923,086
Deposit and prepayment for properties		127,939			181,233
Prepayments for lease of land		325,016			353,347
Intangible assets, net		26,129			30,259
Right of use assets		1,766,401			205,824
Other noncurrent assets		14,930			-
Deferred tax assets		2,107,281			2,176,710
Total Assets	$	38,651,573		$	36,267,420

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities
Accounts payable	$	23,968		$	38,933
Advances from customers		27,375			7,432
Income tax payable		2,586,716			2,478,273
Operating lease liabilities, current portion		405,431			88,968
Accrued expenses and other liabilities		895,063			974,801
Total Current Liabilities		3,938,553			3,588,407

Operating lease liabilities, noncurrent portion		1,445,468			112,591
Total Liabilities		5,384,021			3,700,998

Commitments and Contingencies

Shareholders’ Equity
Class A Ordinary Share (par value $0.0001 per share, 450,000,000 shares authorized; 20,513,423 and 19,453,423 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively)		2,052			1,946
Class B Ordinary Share (par value $0.0001 per share, 50,000,000 shares authorized; 5,497,715 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively)		550			550
Additional paid-in capital		24,923,046			22,986,975
Statutory reserve		1,199,054			1,199,054
Retained earnings		7,274,435			7,180,891
Accumulated other comprehensive (loss) income		(131,585	)		1,197,006
Total Shareholders’ Equity		33,267,552			32,566,422

Total Liabilities and Shareholders’ Equity	$	38,651,573		$	36,267,420

ZHONGCHAO INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

For the Six Months Ended June 30, 2022 and 2021

(Expressed in U.S. dollar, except for the number of shares and per share data)

	For the Six Months Ended June 30,
	2022			2021
Revenues	$	7,295,439		$	8,615,572
Cost of revenues		(2,236,718	)		(3,147,596	)
Gross Profit		5,058,721			5,467,976

Operating Expenses
Selling and marketing expenses		(1,316,733	)		(1,957,522	)
General and administrative expenses		(3,046,045	)		(2,235,044	)
Research and development expenses		(153,290	)		(416,077	)
Total Operating Expenses		(4,516,068	)		(4,608,643	)

Income from Operations		542,653			859,333

Interest income, net		82,913			65,795
Other (expenses) income, net		(247,327	)		119,043
Income Before Income Taxes		378,239			1,044,171

Income tax expenses		(284,695	)		(42,612	)

Net Income		93,544			1,001,559

Other Comprehensive (Loss) Income
Foreign currency translation adjustment		(1,328,591	)		193,677
Comprehensive (Loss) Income	$	(1,235,047	)	$	1,195,236

Weighted average number of ordinary share outstanding
Basic and Diluted		25,976,000			24,933,138

Earnings per share
Basic and Diluted	$	0.00		$	0.04

ZHONGCHAO INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Expressed in U.S. dollar, except for the number of shares)

For the Six Months Ended June 30, 2022

	Ordinary share								Additional						Accumulated other
	Class A				Class B				paid-in		Statutory		Retained		comprehensive			Total
	Shares		Amount		Shares		Amount		capital		Reserve		earning		income			equity
Balance as of December 31, 2021		19,435,423	$	1,946		5,497,715	$	550	$	22,986,975	$	1,199,054	$	7,180,891	$	1,197,006		$	32,566,422
Ordinary shares issued in a shelf offering		1,060,000		106		-		-		1,850,368		-		-		-			1,850,474
Share-based compensation expenses		-		-		-		-		85,703		-		-		-			85,703
Net income		-		-		-		-		-		-		93,544		-			93,544
Foreign currency translation adjustments		-		-		-		-		-		-		-		(1,328,591	)		(1,328,591	)
Balance as of June 30, 2022		20,513,423	$	2,052		5,497,715	$	550	$	24,923,046	$	1,199,054	$	7,274,435	$	(131,585	)	$	33,267,552

For the Six Months Ended June 30, 2021

	Ordinary share								Additional						Accumulated other
	Class A				Class B				paid-in		Statutory		Retained		comprehensive		Total
	Shares		Amount		Shares		Amount		capital		Reserve		earning		income		equity
Balance as of December 31, 2020		19,435,423	$	1,944		5,497,715	$	550	$	22,775,154	$	801,502	$	7,339,778	$	915,213	$	31,834,141
Share-based compensation expenses		-		-		-		-		89,502		-		-		-		89,502
Net income		-		-		-		-		-		-		1,001,559		-		1,001,559
Foreign currency translation adjustments		-		-		-		-		-		-		-		193,677		193,677
Balance as of June 30, 2021		19,435,423	$	1,944		5,497,715	$	550	$	22,864,656	$	801,502	$	8,341,337	$	1,108,890	$	33,118,879

ZHONGCHAO INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Six Months Ended June 30, 2022 and 2021

(Expressed in U.S. dollar, except for the number of shares)

	For the Six Months Ended June 30,
	2022			2021
Cash Flows from Operating Activities:
Net income	$	93,544		$	1,001,559
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization expenses		128,356			143,028
Writing off accounts receivable		-			323,524
Amortization of right of use assets		183,132			139,217
Recognition of share-based compensation expenses		85,703			89,502
Deferred tax benefits		(29,296	)		(485,654	)
Equity investment loss		61,774			43
Changes in fair value of short-term investments		234,652			(62,533	)
Changes in operating assets and liabilities:
Accounts receivable		(942,164	)		(303,213	)
Prepayments		(813,023	)		420,735
Other current assets		79,119			10,626
Accounts payable		(13,515	)		64,575
Advances from customers		20,991			68,888
Income tax payable		235,956			474,650
Accrued expenses and other liabilities		(30,266	)		(120,956	)
Lease liabilities		(91,584	)		(151,123	)
Deferred government grants		-			1,127
Net Cash (Used in) Provided by Operating Activities		(796,621	)		1,613,995

Cash Flows from Investing Activities:
Purchases of property and equipment		(25,291	)		(1,874,496	)
Purchases of intangible assets		(15,434	)		-
Prepayments for a long-term investment		(617,370	)		-
Loans to third parties		(971,712	)		(1,390,000	)
Repayment of loans from third parties		1,165,041			-
Due from affiliates		(2,233,335	)		-
Investments in short-term investments		(996,638	)		(838,747	)
Proceeds from redemption of short-term investments		533,747			-
Net Cash Used in Investing Activities		(3,160,992	)		(4,103,243	)

Cash Flows from Financing Activities:
Proceeds from issuance of ordinary shares in connection with a shelf offering		1,850,474			-
Net Cash Provided by Financing Activities		1,850,474			-

Effect of exchange rate changes on cash and cash equivalents		(326,486	)		80,693

Net decrease in cash and cash equivalents		(2,433,625	)		(2,408,555	)
Cash and cash equivalents at beginning of period		13,914,982			15,072,947
Cash and cash equivalents at end of period	$	11,481,357		$	12,664,392

Supplemental Cash Flow Information
Cash paid for income tax	$	78,034		$	41,112

Noncash investing activities
Right of use assets obtained in exchange for operating lease obligations	$	1,771,361		$	199,505

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Zhongchao (ZCMD) 6-KReport of Foreign Private Issuer