Hebron Technology Co., Ltd. today announced its financial results for the six months ended June 30, 2017.
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WENZHOU, China, Dec. 29, 2017 /PRNewswire/ -- Hebron Technology Co., Ltd. (Nasdaq: HEBT), a developer, manufacturer and installer of valves and pipe fittings for use in the pharmaceutical, biological, food and beverage, and other clean industries, today announced its financial results for the six months ended June 30, 2017. Mr. Anyuan Sun, Chairman and Chief Executive Officer of Hebron, commented, "With revenues decreasing by 27.9% to $7.74 million, our first half financial results reflected the impact of fewer projects being completed for our installation services as the relocation of our manufacturing facility caused a temporary interruption to our business during the six months ended June 30, 2017. However, with recent multiple project wins and a growing project pipeline, we are confident about our near-term outlook and expect the growth to return in the near future." Six Months Ended June 30, 2017 Financial Results
For the Six Months Ended June 30,
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($ millions) 2017 2016 % Change
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Revenues 7.74 10.74 -27.9%
Installation service 6.35 9.82 -35.3%
Fluid equipment sales 1.39 0.92 50.8%
Gross profit 2.87 4.11 -30.1%
Gross margin 37.1% 38.2% -1.2 pp*
Installation service 40.3% 40.0% 0.4 pp*
Fluid equipment sales 22.2% 20.0% 2.2 pp*
Operating income 0.17 2.90 -94.3%
Operating margin 2.1% 27.0% -24.9 pp*
Net income (loss) -0.34 2.14 -116.0%
Net income (loss) margin -4.4% 20.0% -24.4 pp*
Diluted earnings (loss) per share -0.02 0.18 -113.1%
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*pp represents percentage points
Revenues For the six months ended June 30, 2017, total revenues decreased by $3.00 million, or 27.9%, to $7.74 million from $10.74 million for the same period of last year. The decrease in total revenues was related to a decrease in revenues from installation services as fewer projects were completed during the six months ended June 30, 2017. Revenues from installation services decreased by $3.47 million, or 35.3%, to $6.35 million for the six months ended June 30, 2017 from $9.82 million for the same period of last year. We provided installation services for 3 projects with an average project revenue of $2.12 million during the six months ended June 30, 2017, compared to 4 projects with an average project revenue of $2.46 million during the same period of last year. Revenues from fluid equipment sales increased by $0.47 million, or 50.8%, to $1.39 million for the six months ended June 30, 2017 from $0.92 million for the same period of last year. Cost of revenues and gross profit Total cost of revenues decreased by $1.76 million, or 26.6%, to $4.87 million for the six months ended June 30, 2017 from $6.64 million for the same period of last year. Overall gross profit decreased by $1.24 million, or 30.1%, to $2.87 million for the six months ended June 30, 2017 from $4.11 million for the same period of last year. Overall gross margin was 37.1% for the six months ended June 30, 2017, down 1.2 percentage points from 38.2% for the same period of last year. Cost of revenues for installation services decreased by $2.11 million, or 35.7%, to $3.79 million for the six months ended June 30, 2017 from $5.90 million for the same period of last year. The decrease in cost of revenues was in line with the decrease in revenues for installation services. Gross profit for installation services decreased by $1.36 million, or 34.7%, to $2.56 million for the six months ended June 30, 2017 from $3.92 million for the same period of last year. Gross margin for installation services was 40.3% for the six months ended June 30, 2017, compared to 40.0% for the same period of last year. Cost of revenues for fluid equipment sales increased by $0.34 million, or 46.6%, to $1.08 million for the six months ended June 30, 2017 from $0.74 million for the same period of last year. Gross profit for fluid equipment sales increased by $0.12 million, or 67.5%, to $0.31 million for the six months ended June 30, 2017 from $0.18 million for the same period of last year. Gross margin for fluid equipment sales was 22.2% for the six months ended June 30, 2017, compared to 20.0% for the same period of last year. Operating expenses General and administrative expenses increased by $1.00 million, or 215.3%, to $1.47 million for the six months ended June 30, 2017 from $0.47 million for the same period of last year. The increase was mainly due to higher professional accounting and legal fees incurred during the six months ended June 30, 2017 associated with the Company's listing on NASDAQ. Selling expenses were $0.75 million for the six months ended June 30, 2017, compared to $0.72 million for the same period of last year. Research and development expenses were $0.49 million for the six months ended June 30, 2017, compared to $0.02 million for the same period of last year. The increase in research and development expenses was mainly due to increased R&D activities in developing the intelligent valve controller system during the six months ended June 30, 2017. As such, total operating expenses increased by $1.50 million, or 123.9%, to $2.70 million for the six months ended June 30, 2017 from $1.21 million for the same period of last year. Operating income Operating income decreased by $2.73 million, or 94.3%, to $0.17 million for the six months ended June 30, 2017 from $2.90 million for the same period of last year. The decrease in operating income was due to the combined effect of a decrease in revenues and an increase in operating expenses. Operating margin was 2.1% for the six months ended June 30, 2017, compared to 27.0% for the same period of last year. Income before income taxes and income tax Income before income taxes decreased by $2.74 million, or 95.0%, to $0.14 million for the six months ended June 30, 2017 from $2.89 million for the same period of last year. Income tax provision was $0.49 million for the six months ended June 30, 2017, compared to $0.74 million for the same period of last year. Net income (loss) and earnings (loss) per share Net loss was $0.34 million, or loss per share of $0.02, for the six months ended June 30, 2017, compared to net income of $2.14 million, or earnings per share of $0.18, for the same period of last year. The decrease in net earnings was primarily related to the decrease in revenues and, to a lesser extent, the increase in operating expenses. About Hebron Technology Co., Ltd. Established in January 2005 and headquartered in Wenzhou City, Zhejiang Province, China, Hebron Technology Co., Ltd. ("Hebron" or the "Company") engages in research, development, and manufacture of highly specialized valves and pipe fitting products for use in the pharmaceutical, biological, food and beverage, and other clean industries. The Company also offers its customers comprehensive pipeline design, installation, construction, and ongoing maintenance services as holistic solution services. Forward-Looking Statements This press release contains information about Hebron's view of its future expectations, plans and prospects that constitute forward-looking statements. Actual results may differ materially from historical results or those indicated by these forward-looking statements as a result of a variety of factors including, but not limited to, risks and uncertainties associated with its ability to raise additional funding, its ability to maintain and grow its business, variability of operating results, its ability to maintain and enhance its brand, its development and introduction of new products and services, the successful integration of acquired companies, technologies and assets into its portfolio of products and services, marketing and other business development initiatives, competition in the industry, general government regulation, economic conditions, dependence on key personnel, the ability to attract, hire and retain personnel who possess the technical skills and experience necessary to meet the requirements of its clients, and its ability to protect its intellectual property. Hebron encourages you to review other factors that may affect its future results in Hebron's registration statement and in its other filings with the Securities and Exchange Commission. For more information, please contact: At the Company Investor Relations
HEBRON TECHNOLOGY CO., LIMITED
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
June 30, December 31,
2017 2016
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ASSETS
CURRENT ASSETS:
Cash $3,610,585 $11,875,893
Contracts receivable, net 13,293,350 12,928,033
Accounts receivable, net 265,002 187,852
Notes receivable 14,611 277,745
Retainage receivables, net 2,552,813 2,425,500
Inventories 3,775,477 2,249,623
Prepayments and advances to suppliers, net 9,024,485 4,537,823
Other receivables, net 618,977 96,602
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TOTAL CURRENT ASSETS 33,155,300 34,579,071
Property and equipment at cost, net of accumulated depreciation 13,153,805 11,186,013
Land use right, net of accumulated amortization 1,070,006 1,071,310
Deferred tax assets 207,687 242,963
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TOTAL ASSETS $47,586,798 $47,079,357
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LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term loans $250,760 $287,986
Accounts payable 1,221,616 1,185,215
Accrued expenses and other current liabilities 886,930 1,009,878
Advances from customers 2,997,590 3,060,962
Deferred revenue 877,095 1,042,511
Taxes payable 9,353,299 8,744,563
Due to related parties - 68,397
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TOTAL CURRENT LIABILITIES 15,587,290 15,399,512
Long-term loans 395,315 532,775
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TOTAL LIABILITIES 15,982,605 15,932,287
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COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Common stock, $0.001 par value, 50,000,000 shares authorized, 14,695 14,695
14,695,347 and 14,695,347 shares issued and outstanding as of June 30,
2017 and December 31, 2016, respectively
Additional paid-in capital 10,237,965 10,237,965
Retained earnings 22,397,770 22,741,104
Accumulated other comprehensive loss (1,046,237) (1,846,694)
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TOTAL SHAREHOLDERS' EQUITY 31,604,193 31,147,070
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $47,586,798 $47,079,357
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HEBRON TECHNOLOGY CO., LIMITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
For The Six Months Ended June 30,
2017 2016
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REVENUE
Installation service $6,352,092 $9,820,436
Fluid equipment sales 1,391,348 922,697
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7,743,440 10,743,133
COST OF REVENUE
Cost of product and services 4,769,712 6,482,331
Business and sales related taxes 103,923 153,099
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GROSS PROFIT 2,869,805 4,107,703
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OPERATING EXPENSES
General and administrative expenses 1,469,722 466,192
Selling expenses 749,522 719,230
Research and development expenses 485,335 22,440
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Total operating expenses 2,704,579 1,207,862
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INCOME FROM OPERATIONS 165,226 2,899,841
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OTHER INCOME (EXPENSE)
Other income, net 2,256 283
Interest expense (23,518) (12,114)
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Total other expense, net (21,262) (11,831)
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INCOME BEFORE INCOME TAXES 143,964 2,888,010
PROVISION FOR INCOME TAXES 487,298 744,118
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NET INCOME (LOSS) $(343,334) $2,143,892
OTHER COMPREHENSIVE INCOME (LOSS)
Foreign currency translation gain
(loss) 800,457 (437,776)
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COMPREHENSIVE INCOME $457,123 $1,706,116
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Basic and diluted earnings per common
share
Basic $(0.02) $0.18
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Diluted $(0.02) $0.18
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Weighted average number of shares
outstanding
Basic 14,695,347 12,000,000
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Diluted 14,695,347 12,000,000
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View original content:http://www.prnewswire.com/news-releases/hebron-technology-co-ltd-reports-financial-results-for-the-first-half-of-2017-300576174.html SOURCE Hebron Technology Co., Ltd. |
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Company Codes: NASDAQ-SMALL:HEBT |
