HANGZHOU, China, Jan. 17, 2018 /PRNewswire/ -- Dragon Victory
International Limited ("LYL" or the "Company"), a company offering
reward-based crowdfunding opportunities and quality incubation
services to entrepreneurs in China, today announced its financial results
for the first six months of fiscal year 2018 ended September 30, 2017.
Mr. Jianjun Sun, Chairman and
Chief Executive Officer of Dragon Victory International Limited,
commented, "With revenue up 60 percent year-over-year, we are
pleased to report our latest financial results after listing on the
Nasdaq that highlighted continued momentum in our business for the
first six months of fiscal year 2018. Our recent IPO has not only
significantly raised our public profile but also improved our
market and accelerated our business development. We continue to
benefit from the robust growth in the crowdfunding and incubation
services by 555% and 25%, respectively."
Mr. Jianjun Sun continued, "We
are pleased with the progress we are making via a collaboration
agreement with Shenzhen 708090
Investment and Development Co., Ltd, Shenzhen Wedo Union Technology
Co., Ltd., China Zhejiang Communication Center as well as with Mr.
Jiawei Cao for our crowdfunding
platform upgrade. We have a multitude of promising opportunities
ahead to position the Company for long-term growth. Going forward,
we strive to maintain our growth momentum by building more
partnerships with prestigious institutions improving the uniformity
in quality of service across our entire network. We believe that
our visionary team, desirable services and solid reputation will
allow us to diversify our business through the introduction of new
financial services that will position us well for sustainable
growth for the years to come as an industry pioneer."
|
|
For the Six Months
Ended Sep 30
|
($ millions,
except per share Data)
|
2017
|
|
2016
|
|
%
Change
|
Revenue
|
|
1.89
|
|
1.18
|
|
59.6%
|
Crowdfunding
|
0.51
|
|
0.08
|
|
554.9%
|
Incubation
Service
|
1.38
|
|
1.10
|
|
25.0%
|
Finder's Fee
Service
|
0.00
|
|
0.00
|
|
0%
|
Income from
operation
|
0.57
|
|
0.59
|
|
-3.9%
|
Income (Loss) before
tax
|
0.62
|
|
0.60
|
|
4.0%
|
Comprehensive
income
|
0.34
|
|
0.33
|
|
3.0%
|
EPS
|
|
0.039
|
|
0.039
|
|
-0.7%
|
|
|
|
|
|
|
|
First Six Months 2018 Financial Highlights
- Revenues increased by 59.6% to $1.89
million for the six months ended September 30, 2017, mainly due to increases in
both crowdfunding and incubation services.
- Income from operations decreased by 3.9% to $0.57 million for the six months ended
September 30, 2017 from $0.59 million, for the same period of last
year.
- Income before tax increased by 4.0% to $0.62 million for the six months ended
September 30, 2017, primarily due to
additional accruals in the PRC.
- Basic and diluted earnings per share were $0.039 for the six months ended September 30, 2017, compared with $0.039 for the same period of last year.
First Six Months 2018 Financial Results
Revenues
For the six months ended September 30,
2017, revenue increased by $0.70
million, or 59.6%, to $1.89
million from $1.18 million for
the same period of last year. The increase in revenue was mainly
due to increases in both crowdfunding and incubation services.
Revenue from crowdfunding increased by $0.43
million, or 554.9%, to $0.51
million and accounted for 26.8% of total revenue for the six
months ended September 30, 2017 from
$0.08 million, or 6.5% of total
revenues, for the same period of last year. The increase was
primarily due to crowdfunding projects increase, there were 31
completed projects compared to 6 projects for the same period last
year. Revenue from incubation service increased by $0.28 million, or 25.0%, to $1.38 million and accounted for 73.2% of total
revenue for the six months ended September
30, 2017 from $1.10 million,
or 93.5% of total revenues, for the same period of last year. The
increase was primarily due to the increase in the number of
incubation project, as there were 8 projects compared to 6 projects
for the same period of last year.
Operating expenses
Selling, general and administrative expenses increased by
$0.73 million, or 123.8%, to
$1.31 million for the six months
ended September 30, 2017 from
$0.59 million for the same period of
last year. The increase in selling, general and administrative
expenses was primarily due to increases in rent expenses, travel
expenses, employees' wages and benefits and IT and data
services.
Other Income and Expenses
Total other income increased by $47,259 to $50,115
for the six months ended September 30,
2017 from $2,856 for the same
period of last year. The increase in other income was mainly due to
interest income, which increased by $50,669, to $50,692
for the six months ended September 30,
2017 from $23 for the same
period of last year.
Taxes
Income tax increased by $0.02
million, or 10.6%, to $0.23
million for the six months ended September 30, 2017 from $0.21 million for the same period of last year,
mainly due to additional accruals in the PRC.
Net income
Net income increased by $2,255, or
0.6%, to $391,851 for the six months
ended September 30, 2017 from
$389,596 for the same period of last
year.
Basic and diluted earnings per share were $0.039 for the six months ended September 30, 2017, compared with basic and
diluted earnings per share of $0.039
for the same period of last year.
Financial Conditions
As of September 30, 2017, the
Company had cash and cash equivalents of $8.55 million, compared with $3.22 million as of March 31, 2017. Working
capital was $11.26 million,
respectively, as of September 30,
2017, compared with $2.86
million, as of March 31,
2017.
Net cash used in operating activities was $0.68 million for the six months ended
September 30, 2017, compared to net
cash provided by operating activities of $0.80 million for the same period of last
year.
Net cash used in investing activities was $1.94 million for the six months ended
September 30, 2017, compared to
$0.50 million for the same period of
last year.
Net cash provided by financing activities was $7.89 million for the six months ended
September 30, 2017, compared to net
cash used in financing activities of $0.17
million for the same period of last year.
Recent Updates
On December 12, 2017, the Company
announced that Mr. Hongyu Zhang was
appointed by the Company's Nominating Committee and approved by the
Board as the director of the Company's Board, to replace the
departing director, Mr. Chao Fu
Chen, who had resigned on December
12 for personal reasons. Mr. Chen will continue to serve in
his role as Chief Operating Officer in the management team. Mr.
Wenbing Wang was appointed by the
Company's Nominating Committee and approved by the Board as an
independent director of the Company's Board, to replace the
departing independent director, Mr. Shenghua Zheng, who has resigned on December 12, 2017 for personal reasons. Mr.
Wenbing Wang will also serve as the
chairman of the Company's Audit Committee. Mr. Bo Lyu was appointed and approved by the Board
as the Company's Board Secretary.
On November 14, 2017, the Company
announced that it has entered into a Strategic Cooperation
Agreement (the "Agreement") with Shenzhen Wedo Union
Technology Co., Ltd. ("Wedo Union"),
a leading provider of shared workspace, community, and incubation
services for entrepreneurs, freelancers, startups and small
businesses, for incubation services upgrade in China.
On November 8, 2017, the Company
announced that it has moved its headquarters from Xiaoshan District
to Shangcheng District in Hangzhou, Zhejiang
Province, China. The
Company's move was motivated by the larger working space available
in Shangcheng District and the greater governmental subsidies for
relocation to Shangcheng District. As a Nasdaq Capital Market
listed company, the move and the great subsidies will significantly
assist LYL in our continuing business expansion.
On November 3, 2017, the Company
and Mr. Jiawei Cao entered into a
Strategic Cooperation Agreement to form a joint venture in
China, namely, Hangzhou Dacheng
Automotive Technology Service Co., Ltd to upgrade the Company's
current platform to set-up a business ecosystem enabling customers
of internet auto-insurance to take full advantage of the full range
of off-line services provided by auto service providers. The
Company and Mr. Cao will own 60% and 40% of the RMB 16.66 million equity interest in the joint
venture, respectively.
On September 15, 2017, the Company
announced that the closing of its initial public offering ("IPO")
of 1,421,394 ordinary shares at a price to the public of
$6.00 per share for a total of
$8,528,363 in gross proceeds before
expenses, underwriting discount and commissions. The shares
are trading on The NASDAQ Capital Market ("NASDAQ") under the
ticker symbol "LYL".
About Dragon Victory International Limited
Incorporated in 2015 and headquartered in Hangzhou, Dragon Victory International Limited
("LYL" or the "Company") offers reward-based crowdfunding
opportunities in China to
entrepreneurs and funding sources through a fast-growing
reward-based crowdfunding platform at www.5etou.cn. 5etou is
designed to enable small- and medium-sized companies, start-ups and
idea generators to raise funding from participants through the
Internet. The Company also provides quality business incubation
services and financial services to entrepreneurs and business
entities with funding needs who utilize our crowdfunding platform.
More information is available at www.dvintinc.com.
Forward-Looking Statements
This press release contains information about the Company'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. The Company encourages
you to review other factors that may affect its future results in
the Company's registration statement and in its other filings with
the Securities and Exchange Commission.
For more information, please contact:
Company Contact:
Bo Lyu, the Board Secretary
Email: lb@dvintinc.com
Phone: +86-15157527297
Investor Contact:
Tina Xiao, President
Ascent Investor Relations LLC
Email: tina.xiao@ascent-ir.com
Phone: +1-917-609-0333
DRAGON VICTORY
INTERNATIONAL LIMITED AND SUBSIDIARIES
|
|
|
|
|
|
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
March
31,
|
2017
|
2017
|
|
|
(Unaudited)
|
|
(Audited)
|
ASSETS
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
8,546,582
|
|
$
|
3,222,361
|
Trade accounts
receivable, net
|
|
|
1,855,393
|
|
|
673,678
|
Other receivables and
prepayments
|
|
|
308,980
|
|
|
90,413
|
Related party
receivables
|
|
|
40,180
|
|
|
67,145
|
Short-term
investments
|
|
|
1,997,792
|
|
|
—
|
Total current
assets
|
|
|
12,748,927
|
|
|
4,053,597
|
Non-current
assets
|
|
|
|
|
|
|
Investment
|
|
|
75,105
|
|
|
72,563
|
Property, plant and
equipment, net
|
|
|
18,643
|
|
|
32,824
|
Intangible assets,
net
|
|
|
711
|
|
|
812
|
Other
assets
|
|
|
22,310
|
|
|
52,739
|
TOTAL
ASSETS
|
|
|
12,865,696
|
|
|
4,212,535
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
Accounts
payable
|
|
|
35,203
|
|
|
63,483
|
Taxes
payable
|
|
|
1,196,753
|
|
|
830,606
|
Accrued liabilities
and other current liabilities
|
|
|
188,954
|
|
|
253,913
|
Related party
payable
|
|
|
64,436
|
|
|
42,960
|
Total current
liabilities
|
|
|
1,485,346
|
|
|
1,190,962
|
TOTAL
LIABILITIES
|
|
|
1,485,346
|
|
|
1,190,962
|
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 as of September 30, 2017
and March 31, 2017, respectively
|
|
|
1,142
|
|
|
1,000
|
Additional paid-in
capital
|
|
|
8,924,380
|
|
|
1,053,607
|
Statutory
reserves
|
|
|
65,331
|
|
|
65,331
|
Retained
earnings/(losses)
|
|
|
2,443,103
|
|
|
2,051,252
|
Accumulated other
comprehensive loss
|
|
|
(53,606)
|
|
|
(149,617)
|
TOTAL
STOCKHOLDER'S EQUITY
|
|
|
11,380,350
|
|
|
3,021,573
|
TOTAL LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|
$
|
12,865,696
|
|
$
|
4,212,535
|
|
|
|
|
|
|
|
DRAGON VICTORY
INTERNATIONAL LIMITED AND SUBSIDIARIES
|
|
|
|
|
|
|
|
|
CONSOLIDATED
STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
|
|
|
|
|
|
|
|
|
|
|
For the Six Months
Ended
|
|
|
|
September 30,
|
|
September 30,
|
|
2017
|
2016
|
|
|
(Unaudited)
|
|
(Audited)
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
1,885,736
|
|
$
|
1,181,526
|
|
Operating
expenses
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
|
1,314,943
|
|
|
587,590
|
|
Total operating
expenses
|
|
|
1,314,943
|
|
|
587,590
|
|
Income from
operation
|
|
|
570,793
|
|
|
593,936
|
|
Other income
(expenses):
|
|
|
|
|
|
|
|
Other
income
|
|
|
—
|
|
|
3,112
|
|
Other
expenses
|
|
|
(577)
|
|
|
(279)
|
|
Interest
income
|
|
|
50,692
|
|
|
23
|
|
Total other income
and expenses
|
|
|
50,115
|
|
|
2
,856
|
|
Income before
tax
|
|
|
620,908
|
|
|
596,792
|
|
Income
tax
|
|
|
(229,057)
|
|
|
(207,196)
|
|
Net
income
|
|
$
|
391,851
|
|
$
|
389,596
|
|
Other
comprehensive income
|
|
|
|
|
|
|
|
Foreign currency
translation loss
|
|
|
(53,606)
|
|
|
(61,096)
|
|
Comprehensive
income
|
|
$
|
338,245
|
|
$
|
328,500
|
|
Earnings per
share
|
|
|
|
|
|
|
|
Basic
|
|
$
|
0.039
|
|
$
|
0.039
|
|
Diluted
|
|
$
|
0.039
|
|
$
|
0.039
|
|
Weighted average
shares outstanding
|
|
|
|
|
|
|
|
Basic
|
|
|
10,124,275
|
|
|
10,000,000
|
|
Diluted
|
|
|
10,124,275
|
|
|
10,000,000
|
|
|
|
|
|
|
|
|
|
DRAGON VICTORY
INTERNATIONAL LIMITED AND SUBSIDIARIES
|
|
|
|
|
|
|
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
For the Six Months
Ended
|
|
|
|
September 30,
|
|
September 30,
|
|
2017
|
2016
|
|
|
(Unaudited)
|
|
(Audited)
|
|
Cash flows from
operating activities
|
|
|
|
|
|
Net
income
|
|
$
|
377,726
|
|
$
|
389,596
|
|
Adjustments to
reconcile net income to net cash provided by (used in) operating
activities
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
18,691
|
|
|
12,664
|
|
Changes in assets and
liabilities
|
|
|
|
|
|
|
|
Increase in accounts
receivables
|
|
|
(1,148,224)
|
|
|
(747,300)
|
|
(Increase)/Decrease
in other receivables and prepayments
|
|
|
(203,156)
|
|
|
81,362
|
|
Increase in related
party receivables
|
|
|
30,262
|
|
|
558,180
|
|
Decrease in other
assets
|
|
|
—
|
|
|
10,639
|
|
(Decrease)/Increase
in accounts payables
|
|
|
(26,588)
|
|
|
26,192
|
|
Increase in taxes
payable
|
|
|
331,582
|
|
|
277,846
|
|
Increase in accrued
liabilities and other current liabilities
|
|
|
(59,537)
|
|
|
1 95,744
|
|
Net cash (used
in)/provided by operating activities
|
|
|
(679,244)
|
|
|
804,923
|
|
Cash flows from
investing activities
|
|
|
|
|
|
|
|
Acquisition of
investments
|
|
|
(1,965,362)
|
|
|
—
|
|
Increase in related
party receivables
|
|
|
(1,424)
|
|
|
(495,264)
|
|
Purchase of
equipment
|
|
|
(3,483)
|
|
|
—
|
|
Increase in rent and
utility deposits
|
|
|
31,753
|
|
|
—
|
|
Net cash used in
investing activities
|
|
|
(1,938,516)
|
|
|
(495,264)
|
|
Cash flows from
financing activities
|
|
|
|
|
|
|
|
Proceeds from
issuance of ordinary shares
|
|
|
7,731,271
|
|
|
—
|
|
Capital contribution
from owners
|
|
|
139,644
|
|
|
—
|
|
Repayment of capital
lease
|
|
|
—
|
|
|
(8,146)
|
|
Increase/(Decrease)
in related party payable
|
|
|
20,001
|
|
|
(158,528)
|
|
Net cash provided
by/(used in) financing activities
|
|
|
7,890,916
|
|
|
(166,674)
|
|
Net
increase/(decrease) of cash and cash
equivalents
|
|
|
5,273,157
|
|
|
1
42,985
|
|
Effect of foreign
currency translation on cash and cash equivalents
|
|
|
51,064
|
|
|
(5,108)
|
|
Cash and cash
equivalents – beginning of year
|
|
|
3,222,361
|
|
|
2
,480
|
|
Cash and cash
equivalents – end of year
|
|
$
|
8,546,582
|
|
$
|
140,357
|
|
Supplemental cash
flow disclosures
|
|
|
|
|
|
|
|
Interest
received
|
|
$
|
49,583
|
|
$
|
68,976
|
|
Interest
paid
|
|
$
|
11,477
|
|
$
|
—
|
|
Income taxes
paid
|
|
$
|
—
|
|
$
|
207,196
|
|
|
|
|
|
|
|
|
|
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SOURCE Dragon Victory International Limited