BEIJING, Oct. 28, 2023 /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 fiscal year 2023.
Fiscal Year Ended June 30, 2023 Financial Highlights:
– Total revenue decreased by approximately RMB16.7 million ($2.3 million) or 19.9% to RMB67.1 million ($9.3 million) for the year ended June 30, 2023 from RMB83.8million ($12.5 million) for the same period in 2022.
– Gross profit decreased to RMB18.9 million ($2.6 million) for the year ended June 30, 2023, from RMB19.4 million ($2.9 million) for the same period in 2022.
– Gross margin increased to 28.1% for the year ended June 30, 2023 from 23.2% for the same period in 2022.
– Net loss was RMB61.5 million ($8.5 million) for the year ended June 30, 2023, an increase of RMB155.8 million ($21.5 million) from net income of RMB94.3 million ($14.1 million) for the same period of 2022.
For the Years Ended
June 30,
2023
2022
Increase /(Decrease)
Percentage
Change
(in RMB millions, except
earnings per share;
differences due to rounding)
Revenue
RMB
67.1
RMB
83.8
RMB
(16.7)
(19.9)
%
Gross profit
18.9
19.4
(0.5)
(2.9)
%
Gross margin
28.1 %
23.2 %
6.0 %
——
Net income (loss)
(61.5)
94.3
(155.8)
(165.2)
%
Net earnings per share –
Basic and diluted
(1.7)
3.2
(4.9)
(154.5)
%
Management Commentary
Mr. Shenping Yin, Founder and CEO of Recon said, "Fiscal year ended 2023 was a year of change, challenge and opportunity for Recon. As a result of the impact of the outbreak and changes in the industry, our established business volume temporarily declined and recovered less than optimally, and resulting in a decline in overall revenue in fiscal year ended 2023, but our gross margins improved due to management efficiencies and the overall recovery of the industry.
We believe that China’s investment and demand in the oil industry will not decrease in the near future, and we believe that there are still many opportunities for growth in the oil industry. Recon will continue to benefit from this trend. We expect a significant increase in the volume of business in the oilfield services segment in the coming year. We are also expanding our business focus from oilfield service segment to broader energy sectors, including carbon-zero opportunities and alternative materials for primary petroleum products. We are actively exploring the chemical recycling business of low-value plastics based on waste treatment and recycling, and have reached preliminary cooperation agreements and market expansion and sales intentions with key upstream and downstream customers. Our drive has always been to maximize the long-term benefits for our company and our shareholders based on our experience and resources in the petrochemical and energy industries."
Fiscal Year Ended 2023 Financial Results:
Revenue
Total revenues for the year ended June 30, 2023 were approximately RMB67.1 million ($9.3 million), a decrease of approximately RMB16.7 million ($2.3 million) or 19.9% from RMB83.8million ($12.5 million) for the same period in 2022. The overall decrease in revenue was mainly due to decrease from all four segments during the year ended June 30, 2023.
– Revenue from automation product and software decreased by RMB5.3 million ($0.7 million) or 316.6%. The decrease was mainly caused by decreased orders from JiDong oilfield as this client reduced their investment budget and oil and gas extraction activities.
– Revenue from equipment and accessories decreased by ¥0.9 million ($0.1 million) or 5.3% as we decided not to continue working with some oilfield client with low production levels and allocated our sales and service resources into some larger oilfield companies. We believe this was a temporary decline. Our revenue from this segment will increase in the coming year.
– Revenue from oilfield environmental protection decreased by RMB6.2million ($0.9 million) or 24.5%. This was mainly caused by less raw materials we could collect. As a result, our revenue decreased due to lower processing volume compared to the same period last year.
– Revenue from platform outsourcing services decreased by RMB4.2 million ($0.6 million) or 45.2%. The decrease was mainly due to less overall economic activities and lower refueling volumes at gas stations, and change in the method of settlement with major customers, from the original service fee based on a percentage of the volume and transaction amount to a basic fixed monthly service fee.
Cost of revenue
Cost of revenues decreased from RMB64.4 million ($9.6 million) for the year ended June 30, 2022 to RMB48.2 million ($6.7 million) for the same period in 2023. This decrease was mainly caused by the decreased cost of revenue from automation product and software, oilfield environmental protection and platform outsourcing services segments, which was partially offset by the decreased cost of revenue from equipment and accessories segment during the year ended June 30, 2023.
Gross profit
Gross profit decreased to RMB18.9 million ($2.6 million) for the year ended June 30, 2023 from RMB19.4 million ($2.9 million) for the same period in 2022. Gross profit as a percentage of revenue increased to 28.1% for the year ended June 30, 2023 from 23.2% for the same period in 2022.
– For the years ended June 30, 2022 and 2023, our gross profit from automation product and software was approximately RMB2.1 million and RMB3.0 million ($0.4 million), respectively, representing an increase in gross profit of approximately RMB0.9 million ($0.1 million) or 42.4%. In year 2021, we mainly carried out contracts that were signed during the COVID-19 and low oil price period, during which we used a low-margin strategy to maintain our cooperation business with clients. As oil price increase in 2022, our customers recovered and contract terms were improved and our margin increased and the margin percentage will also be higher.
– For the years ended June 30, 2022 and 2023, gross profit from equipment and accessories was approximately RMB6.7 million and RMB7.3 million ($1.0 million), respectively, representing a slight increase of approximately RMB0.6 million ($0.09 million) or 9.3%. This was mainly driven by high oil price and more demands for heating furnaces with higher margin rather than accessories with lower margin.
– For the years ended June 30, 2022 and 2023, gross profit from oilfield environmental protection was approximately RMB5.1 million and RMB5.2 million ($0.7 million), respectively, maintaining at a stable level.
– For the years ended June 30, 2022 and 2023, gross profit from platform outsourcing services was approximately RMB5.5 million and RMB3.4 million ($0.5 million), respectively, representing a decrease of approximately RMB2.1 million ($0.3 million) or 38.6%, this was mainly because personnel expenses, which constitutes major part of our costs, reduced during the year ended June 30, 2023.
Operating expenses
Selling expenses increased by 4.8%, or RMB0.4 million ($0.07 million), from RMB10.2 million in the year ended June 30, 2022 to RMB10.6 million ($1.5 million) in the same period of 2023.
General and administrative expenses decreased by 7.8%, or RMB6.5 million ($0.9 million), from RMB83.3 million in the year ended June 30, 2022 to RMB76.8 million ($10.6 million) in the same period of 2023.
Net recovery of credit losses of RMB0.7 million for the year ended June 30, 2022 as compared to net recovery of credit losses of RMB9.0 million ($1.2 million) for the same period in 2023.
Research and development expenses remained relatively stable with a slight decrease by 1.8%, or RMB0.2 million ($0.02 million) from RMB9.0 million for the year ended June 30, 2022 to RMB8.8 million ($1.2 million) for the same period of 2023.
Loss from operations
Loss from operations was RMB69.3 million ($9.6 million) for the year ended June 30, 2023, compared to a loss of RMB82.3 million for the same period of 2022. This RMB13.0 million ($1.8 million) decrease in loss from operations was primarily due to the decrease in operating expense as discussed above.
Gain in fair value changes 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. Gain in change in fair value of warrant liability was RMB174.5 million and RMB6.1 million ($0.8 million) for the years ended June 30, 2022 and 2023, respectively.
Impairment loss on goodwill and intangible assets
In conjunction with the preparation of our consolidated financial statement for years ended June 30, 2022 and 2023, the management performed evaluation on the impairment of goodwill and intangible assets and recorded an impairment loss on goodwill and intangible assets of RMB2.3 million and RMB10.0 million ($1.4 million) for the years ended June 30, 2022 and 2023, respectively. The impairment was mainly due to the decision of the major customers to develop their own autonomous unified system and to significantly reduce the procurement of third-party services. This change has had a significant and negative impact on FGS’s business model and enterprise value.
Interest income
Net interest income was RMB11.1 million ($1.5 million) for the year ended June 30, 2023, compared to net interest income of RMB3.8 million for the same period of 2022. The RMB.3 million ($1.0 million) increase in net interest income was primarily due to the increased interest-bearing loans to third parties and increased short-term investments we invested during the year ended June 30, 2023.
Other income (expenses), net.
Other net income was RMB0.7 million ($0.1 million) for the year ended June 30, 2023, compared to other net expenses of RMB0.1 million for the same period of 2022.
Net income (loss)
As a result of the factors described above, net loss was RMB61.5 million ($8.5 million) for the year ended June 30, 2023, an increase of RMB155.8 million ($21.5 million) from net income of RMB94.3 million for the same period of 2022.
Cash and short-term investment
As of June 30, 2023, we had cash in the amount of approximately RMB104.1 million ($14.4 million) and short-term investment in bank fixed income product of approximately RMB184.2 million ($25.4 million). As of June 30, 2022, we had cash in the amount of approximately RMB317.0 million ($47.3 million).
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
CONSOLIDATED BALANCE SHEETS
As of June 30
As of June 30
As of June 30
2022
2023
2023
RMB
RMB
U.S. Dollars
ASSETS
Current assets
Cash
¥
316,974,857
¥
104,125,800
$
14,359,604
Restricted cash
723,560
731,545
100,885
Short-term investments
—
184,184,455
25,400,198
Notes receivable
10,828,308
3,742,390
516,099
Accounts receivable, net
22,577,980
27,453,415
3,785,999
Inventories, net
3,894,369
6,330,701
873,044
Other receivables, net
5,501,833
2,185,733
301,427
Loans to third parties
50,383,822
123,055,874
16,970,181
Purchase advances, net
178,208
2,680,456
369,652
Contract costs, net
33,858,820
49,572,685
6,836,386
Prepaid expenses
420,284
350,119
48,284
Prepaid expenses- related parties
275,000
—
—
Total current assets
445,617,041
504,413,173
69,561,759
Property and equipment, net
25,474,162
24,752,864
3,413,576
Construction in progress
239,739
—
—
Intangible assets, net
5,950,000
—
—
Long-term other receivables, net
1,564,381
3,640
502
Goodwill
4,730,002
—
—
Operating lease right-of-use assets (including ¥765,241 and ¥335,976 ($46,333) from a related party as of June 30, 2022 and
2023, respectively)
6,666,759
2,654,900
366,127
Total Assets
¥
490,242,084
¥
531,824,577
$
73,341,964
LIABILITIES AND EQUITY
Current liabilities
Short-term bank loans
¥
10,000,000
¥
12,451,481
$
1,717,138
Accounts payable
16,739,989
10,791,721
1,488,246
Other payables
3,533,918
5,819,010
802,478
Other payable- related parties
2,240,135
2,592,395
357,508
Contract liabilities
2,001,277
2,748,365
379,017
Accrued payroll and employees’ welfare
2,250,547
2,382,516
328,564
Taxes payable
2,210,958
1,163,006
160,386
Short-term borrowings – related parties
9,009,156
20,018,222
2,760,639
Long-term borrowings – related party – current portion
999,530
—
—
Operating lease liabilities – current (including ¥429,265 and ¥335,976 ($46,333) from a related party as of June 30, 2022 and
2023, respectively)
3,892,774
3,066,146
422,841
Total Current Liabilities
52,878,284
61,032,862
8,416,817
Operating lease liabilities – non-current (including ¥335,976 and ¥nil ($nil) from a related party as of June 30, 2022 and 2023,
respectively)
2,184,635
25,144
3,468
Long-term borrowings – related party
5,511,076
—
—
Contract liabilities – non-current
106,000
—
—
Warrant liability
16,677,328
31,615,668
4,360,000
Total Liabilities
77,357,323
92,673,674
12,780,285
Commitments and Contingencies
Equity
Class A ordinary shares, $0.0925 U.S. dollar par value, 150,000,000 shares authorized; 29,700,718 shares and 40,528,218 shares
issued and outstanding as of June 30, 2022 and 2023, respectively
18,001,670
24,912,822
3,435,635
Class B ordinary shares, $0.0925 U.S. dollar par value, 20,000,000 shares authorized; 4,100,000 shares and 7,100,000 shares
issued and outstanding as of June 30, 2022 and 2023, respectively
2,408,498
4,340,731
598,614
Additional paid-in capital
496,038,696
551,118,133
76,002,666
Statutory reserve
4,148,929
4,148,929
572,163
Accumulated deficit
(111,273,525)
(170,440,826)
(23,504,865)
Accumulated other comprehensive income
11,307,461
35,127,173
4,844,259
Total shareholders’ equity
420,631,729
449,206,962
61,948,472
Non-controlling interests
(7,746,968)
(10,056,059)
(1,386,793)
Total equity
412,884,761
439,150,903
60,561,679
Total Liabilities and Equity
¥
490,242,084
¥
531,824,577
$
73,341,964
*The accompanying notes are an integral part of these consolidated financial statements.
RECON TECHNOLOGY, LTD
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
For the years ended
June 30,
2021
2022
2023
2023
RMB
RMB
RMB
USD
Revenue
Revenue – third parties
¥
47,852,918
¥
83,777,571
¥
67,114,378
$
9,255,496
Revenue – related party
85,657
—
—
—
Revenue
47,938,575
83,777,571
67,114,378
9,255,496
Cost of revenue
Cost of revenue – third parties
40,723,547
64,352,834
48,247,395
6,653,620
Cost of revenue
40,723,547
64,352,834
48,247,395
6,653,620
Gross profit
7,215,028
19,424,737
18,866,983
2,601,876
Selling and distribution expenses
8,038,965
10,150,802
10,638,978
1,467,182
General and administrative expenses
45,949,157
83,281,958
76,784,396
10,589,052
Allowance for (net recovery of) credit losses
8,191,247
(658,823)
(9,038,985)
(1,246,533)
Impairment loss of property and equipment and other long-lived assets
768,312
—
1,009,124
139,165
Research and development expenses
5,846,295
8,964,217
8,806,205
1,214,431
Operating expenses
68,793,976
101,738,154
88,199,718
12,163,297
Loss from operations
(61,578,948)
(82,313,417)
(69,332,735)
(9,561,421)
Other income (expenses)
Subsidy income
355,667
11,993
325,425
44,878
Interest income
918,629
5,367,979
13,603,487
1,876,007
Interest expense
(2,210,005)
(1,522,526)
(2,514,850)
(346,814)
Income (loss) from investment in unconsolidated entity
(266,707)
15,411
—
—
Gain in fair value changes of warrants liability
35,365,792
174,485,575
6,116,000
843,435
Remeasurement gain of previously held equity interests in connection with step acquisition
979,254
—
—
—
Foreign exchange transaction gain (loss)
(146,898)
(118,456)
241,652
33,325
Impairment loss on goodwill and intangible assets
—
(2,266,893)
(9,980,002)
(1,376,305)
Other income
192,137
15,855
82,970
11,442
Other income, net
35,187,869
175,988,938
7,874,682
1,085,968
Income (loss) before income tax
(26,391,079)
93,675,521
(61,458,053)
(8,475,453)
Income tax expenses (benefit)
(524,251)
(613,874)
18,339
2,529
Net income (loss)
(25,866,828)
94,289,395
(61,476,392)
(8,477,982)
Less: Net loss attributable to non-controlling interests
(3,034,094)
(1,297,400)
(2,309,091)
(318,438)
Net income (loss) attributable to Recon Technology, Ltd
¥
(22,832,734)
¥
95,586,795
¥
(59,167,301)
$
(8,159,544)
Comprehensive income (loss)
Net income (loss)
(25,866,828)
94,289,395
(61,476,392)
(8,477,982)
Foreign currency translation adjustment
(850,895)
9,332,625
23,819,712
3,284,889
Comprehensive income (loss)
(26,717,723)
103,622,020
(37,656,680)
(5,193,093)
Less: Comprehensive loss attributable to non- controlling interests
(3,034,094)
(1,297,400)
(2,309,091)
(318,438)
Comprehensive income (loss) attributable to Recon Technology, Ltd
¥
(23,683,629)
¥
104,919,420
¥
(35,347,589)
$
(4,874,655)
Earnings (loss) per share – basic and diluted
¥
(1.80)
¥
3.19
¥
(1.74)
$
(0.24)
Weighted – average shares -basic and diluted
12,697,024
30,002,452
33,923,112
33,923,112
*The accompanying notes are an integral part of these consolidated financial statements.
RECON TECHNOLOGY, LTD
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended June 30,
2021
2022
2023
2023
RMB
RMB
RMB
U.S. Dollars
Cash flows from operating activities:
Net income (loss)
¥
(25,866,828)
¥
94,289,395
¥
(61,476,393)
$
(8,477,982)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization
3,150,789
3,339,868
3,683,586
507,990
Loss (gain) from disposal of equipment
19,590
48,628
(12,782)
(1,763)
Gain in fair value changes of warrants liability
(35,365,792)
(174,485,575)
(6,116,000)
(843,435)
Amortization of offering cost of warrants
12,584,024
—
1,483,306
204,557
Allowance for (net recovery of) credit losses
8,191,247
(658,823)
(9,038,985)
(1,246,533)
Allowance for slow moving inventories
654,673
266,285
484,644
66,835
Impairment loss of property and equipment and other long-lived assets
768,312
—
1,009,124
139,165
Impairment loss on goodwill and intangible assets
—
2,266,893
9,980,002
1,376,305
Amortization of right of use assets
1,866,803
3,138,518
3,252,066
448,480
Restricted shares issued for management and employees
6,140,037
39,263,485
26,191,707
3,612,002
Restricted shares issued for services
—
8,935,919
7,306,822
1,007,657
Remeasurement gain of previously held equity interests in connection with step acquisition
(979,254)
—
—
—
Loss (income) from investment in unconsolidated entity
266,707
(15,411)
—
—
Deferred tax benefit
(425,913)
(624,087)
—
—
Interest expenses related to convertible notes
430,416
—
—
—
Accrued interest income from loans to third parties
—
(270,563)
(7,997,961)
(1,102,969)
Accrued interest income from short-term investment
—
—
(2,901,955)
(400,198)
Changes in operating assets and liabilities:
Notes receivable
(2,124,748)
(4,522,674)
7,085,918
977,193
Accounts receivable
18,326,410
3,811,866
(495,784)
(68,372)
Accounts receivable-related party
3,409,912
—
—
—
Inventories
(2,502,263)
(689,291)
(2,373,013)
(327,253)
Other receivables
(338,468)
285,786
(1,307,694)
(180,339)
Other receivables-related parties
—
—
(64,122)
(8,843)
Purchase advances
(899,371)
865,430
(2,575,198)
(355,136)
Contract costs
(21,944,876)
15,422,513
(14,236,539)
(1,963,309)
Prepaid expense
143,354
(274,215)
70,164
9,676
Prepaid expense – related parties
(433,000)
158,000
275,000
37,924
Operating lease liabilities
(2,762,949)
(1,594,702)
(3,061,303)
(422,173)
Accounts payable
(2,109,944)
(5,523,938)
(1,710,898)
(235,944)
Other payables
5,685,188
(6,329,042)
2,270,104
313,062
Other payables-related parties
(2,577,610)
969,468
352,260
48,579
Contract liabilities
4,160,456
(5,578,999)
641,087
88,410
Accrued payroll and employees’ welfare
(1,593,822)
296,065
131,971
18,200
Taxes payable
76,452
961,964
(1,036,483)
(142,938)
Net cash used in operating activities
(34,050,468)
(26,247,237)
(51,688,331)
(7,128,147)
Cash flows from investing activities:
Purchases of property and equipment
(522,416)
(692,206)
(940,673)
(129,725)
Proceeds from disposal of equipment
—
—
31,950
4,406
Repayments of loans to third parties
5,150,377
171,435,032
40,113,311
5,531,879
Payments made for loans to third parties
(51,638,458)
(171,071,510)
(103,146,761)
(14,224,589)
Payments for short-term investments
—
—
(290,051,964)
(39,999,995)
Redemption of short-term investments
—
—
108,769,464
14,999,995
Step acquisition of FGS, net of cash
471,843
—
—
—
Net cash used in investing activities
(46,538,654)
(328,684)
(245,224,673)
(33,818,029)
Cash flows from financing activities:
Proceeds from short-term bank loans
16,020,000
10,000,000
13,491,481
1,860,560
Repayments of short-term bank loans
(10,540,000)
(15,000,000)
(11,040,000)
(1,522,486)
Proceeds from short-term borrowings
3,660,000
—
—
—
Repayments of short-term borrowings
(3,360,000)
(530,000)
—
—
Proceeds from short-term borrowings-related parties
18,400,000
11,100,000
15,013,115
2,070,403
Repayments of short-term borrowings-related parties
(15,950,000)
(14,770,000)
(9,000,000)
(1,241,157)
Proceeds from long-term borrowings-related party
—
—
—
—
Repayments of long-term borrowings-related party
(816,952)
(892,701)
(1,499,667)
(206,813)
Proceeds from warrants issued with common stock
212,051,414
—
17,493,069
2,412,405
Proceeds from sale of ordinary shares, net of issuance costs
81,091,141
—
28,174,993
3,885,509
Proceeds from sale of prefunded warrants, net of issuance costs
30,276,569
93,321
3,750,282
517,188
Proceeds from stock issuance for warrants exercised
21,130,035
Proceeds from issuance of convertible notes
42,014,616
—
—
—
Refund of capital contribution by a non-controlling shareholder
—
—
—
—
Capital contribution by non-controlling shareholders
50,000
—
—
—
Net cash provided by (used in) financing activities
394,026,823
(9,999,380)
56,383,273
7,775,609
Effect of exchange rate fluctuation on cash and restricted cash
224,365
10,275,148
27,688,659
3,818,441
Net increase (decrease) in cash and restricted cash
313,662,066
(26,300,153)
(212,841,072)
(29,352,126)
Cash and restricted cash at beginning of year
30,336,504
343,998,570
317,698,417
43,812,615
Cash and restricted cash at end of year
¥
343,998,570
¥
317,698,417
¥
104,857,345
$
14,460,489
Supplemental cash flow information
Cash paid during the year for interest
¥
1,682,863
¥
1,427,174
¥
1,200,699
$
165,584
Cash paid during the year for taxes
¥
(98,338)
¥
10,214
¥
18,339
$
2,529
Reconciliation of cash and restricted cash, beginning of year
Cash
¥
30,336,504
¥
343,998,570
¥
316,974,857
¥
43,712,832
Restricted cash
—
—
723,560
99,783
Cash and restricted cash, beginning of year
¥
30,336,504
¥
343,998,570
¥
317,698,417
$
43,812,615
Reconciliation of cash and restricted cash, end of year
Cash
¥
343,998,570
¥
316,974,857
¥
104,125,800
¥
14,359,604
Restricted cash
—
723,560
731,545
100,885
Cash and restricted cash, end of year
¥
343,998,570
¥
317,698,417
¥
104,857,345
$
14,460,489
Non-cash investing and financing activities
Issuance of common stock in exchange of shares of FGS, net of issuance costs
¥
1,689,807
¥
—
¥
—
$
—
Cancellation of common stock issued prior years in exchange of shares of FGS , net of issuance costs
¥
(1,689,807)
¥
—
¥
—
$
—
Issuance of common stock in exchange of shares of Starry, net of issuance costs
27,675,450
¥
—
¥
—
$
—
Cancellation of shares issued to Starry Lab
¥
—
¥
(27,675,450)
¥
—
$
—
Conversion of convertible notes to 9,225,338 shares of ordinary shares
¥
42,435,669
¥
—
¥
—
$
—
Right-of-use assets obtained in exchange for operating lease obligations
¥
7,242,819
¥
937,672
¥
75,182
$
10,368
Reduction of right-of-use assets and operating lease obligations due to early termination of lease agreement
¥
—
¥
—
¥
62,357
$
10,368
Inventories transferred to and used as fixed assets
¥
302,795
¥
—
¥
(65,456)
$
8,599
Receivable for disposal of property and equipment
¥
—
¥
3,000
¥
—
$
(9,027)
Capital contribution receivable due from non-controlling Interest
¥
50,000,000
¥
—
¥
—
$
—
Other payable due to non-controlling interest converted into capital contribution
¥
—
¥
1,130,000
¥
—
$
—
*The accompanying notes are an integral part of these consolidated financial statements.
Source : Recon Technology, Ltd Reports Financial Year Results for Fiscal Year 2023
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