SHANGHAI, Sept. 29, 2018
/PRNewswire/ -- Golden Bull Limited (NASDAQ: DNJR) ("Golden Bull" or the "Company", an online finance
marketplace, or "peer-to-peer" lending company in China that provides borrowers access to
short-term loans today announced its financial results for the six
months ended June 30, 2018.
Six Months Ended June 30, 2018
Financial Highlights (all comparable to the prior year
period):
- Total revenues for the six months ended June 30, 2018 increased by 75.4% to approximately
$4.9 million from approximately
$2.8 million for the six months ended
June 30, 2017.
- Total number of loans facilitated for the six month ended
June 30, 2018 increased by 40.7% to
3,090 loans facilitated from 2,196 loans facilitated for the six
months ended June 30,
2017.
- Total number of borrowers for the six months ended
June 30, 2018 increased by 55.9% to
505 borrowers from 324 borrowers for the six months ended
June 30, 2017.
- Total loan volume in dollar facilitated for the six
months ended June 30, 2018 increased
by 44.9% to approximately $77.8
million from $53.7 million for
the six months ended June 30,
2017.
- Net loss for the six months ended June 30, 2018 increased by 23.6% to approximately
$0.7 million from approximately
$0.6 million for the six months ended
June 30, 2017.
Management Commentary
Mr. Erxin Zeng, CEO of Golden
Bull stated, "Our revenues continued on a rise during the
six months ended June 30, 2018 as
compared to the same period of 2017. We expect this trend to
continue as we keep building our brand reputation and lender
base.
Recent Developments
Initial Public Offering
On March 22, 2018, the Company
completed the closing of its initial public offering of 1,550,000
ordinary shares at a public offering price of $4.00 per ordinary share, for total gross
proceeds of approximately $6.2
million before underwriting discounts and commissions and
offering expenses. In addition, the Company has granted the
underwriters a 45-day option to purchase up to an additional
232,500 ordinary shares at the public offering price of
$4.00 per share. On March 28, 2018, the underwriter exercised the
full over-allotment option to purchase an additional 232,500
ordinary shares at the IPO prices of $4.00 per share. The total net proceeds from the
over-allotment were approximately $930,000 less underwriting discount and
commissions.
The Company has also granted the underwriters warrant to
purchase up to an additional 178,250 ordinary shares at an exercise
price equal to 125% of the public offering price. These warrants
will be non-exercisable and non-transferable for 180 days following
March 19, 2018, the effective date of
IPO registration statement. Such warrants provide for cashless
exercise in certain circumstances and shall terminate three years
and six months after March 19,
2018.
Revenue Recognition
On January 1, 2018, the Company
adopted Accounting Standards Update ("ASU") 2014-09 Revenue from
Contracts with Customers (ASC 606) using the modified retrospective
method for contracts that were not completed as of January 1, 2018. This did not result in an
adjustment to retained earnings upon adoption of this new guidance
as the Company's revenue was recognized based on the amount of
consideration we expect to receive in exchange for satisfying the
performance obligations.
The core principle underlying the revenue recognition ASU is
that the Company will recognize revenue to represent the transfer
of goods and services to customers in an amount that reflects the
consideration to which the Company expects to be entitled in such
exchange. This will require the Company to identify contractual
performance obligations and determine whether revenue should be
recognized at a point in time or over time, based on when control
of goods and services transfers to a customer. The Company's
revenue streams are primarily recognized at a point in time.
The ASU requires the use of a new five-step model to recognize
revenue from customer contracts. The five-step model requires that
the Company (i) identify the contract with the customer, (ii)
identify the performance obligations in the contract, (iii)
determine the transaction price, including variable consideration
to the extent that it is probable that a significant future
reversal will not occur, (iv) allocate the transaction price to the
respective performance obligations in the contract, and (v)
recognize revenue when (or as) the Company satisfies the
performance obligation. The application of the five-step model to
the revenue streams compared to the prior guidance did not result
in significant changes in the way the Company records its
revenue. Upon adoption, the Company evaluated its revenue
recognition policy for all revenue streams within the scope of the
ASU under previous standards and using the five-step model under
the new guidance and confirmed that there were no differences in
the pattern of revenue recognition.
Transaction Fees: Transaction fees are paid by borrowers
to the Company for the work performed through its platform. These
fees are recognized as a component of operating revenue at the time
of loan issuance. The amount of these fees is based upon the loan
amount and other terms of the loan, including credit grade,
maturity and other factors. These fees are non-refundable upon the
issuance of loan.
Management Fees: Loan borrowers pay a management fee on
each loan payment to compensate the Company for services provided
in connection with facilitation of the loan transactions. The
Company records management fees as a component of operating revenue
at the time of loan issuance. The amount of these fees is based
upon the loan amount and other terms of the loan, including credit
grade, maturity and other factors. These fees are non-refundable
upon the issuance of loan.
The aforementioned revenues are recognized at the time of loan
issuance when control of services transfers to a customer.
Key Operating Metrics
Our management regularly reviews a number of metrics to evaluate
our business, measure our performance, identify trends, formulate
financial projections and make strategic decisions. The main
metrics we consider, and are results for each quarter during the
year ended 2017 and the six months ended June 30, 2018, are set forth in the table
below.
|
|
For the
three
months
ended
March 31
, 2017
|
|
|
For the
three
months
ended
June 30,
2017
|
|
|
For the
three
months
ended
September 30,
2017
|
|
|
For the
three
months
ended
December 31,
2017
|
|
Number of loans
facilitated (1)
|
|
|
1,034
|
|
|
|
1,162
|
|
|
|
1,567
|
|
|
|
1,587
|
|
Number of borrowers
(2)
|
|
|
98
|
|
|
|
226
|
|
|
|
231
|
|
|
|
214
|
|
Loan volume (in $
millions) (3)
|
|
|
25.4
|
|
|
|
28.3
|
|
|
|
36.4
|
|
|
|
38.9
|
|
Reinvestment rate of
existing
lenders(4)
|
|
|
40.4%
|
|
|
|
22.1%
|
|
|
|
17.7%
|
|
|
|
29.4%
|
|
Number of new lenders
that
made a loan
|
|
|
4,426
|
|
|
|
10,714
|
|
|
|
8,487
|
|
|
|
3,871
|
|
Number of lenders
that made a
loan
|
|
|
5,480
|
|
|
|
12,278
|
|
|
|
10,305
|
|
|
|
5,509
|
|
Re-borrowing rate of
existing
borrowers
|
|
|
48.5%
|
|
|
|
71.2%
|
|
|
|
68.0%
|
|
|
|
85.6%
|
|
Number of new
borrowers
|
|
|
86
|
|
|
|
172
|
|
|
|
87
|
|
|
|
43
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the
three
months
ended
March 31,
2018
|
|
|
For the
three
months
ended
June 30,
2018
|
|
|
|
|
|
|
|
|
|
Number of loans
facilitated (1)
|
|
|
1,953
|
|
|
|
1,137
|
|
|
|
|
|
|
|
|
|
Number of borrowers
(2)
|
|
|
265
|
|
|
|
240
|
|
|
|
|
|
|
|
|
|
Loan volume (in $
millions) (3)
|
|
|
50.2
|
|
|
|
27.6
|
|
|
|
|
|
|
|
|
|
Reinvestment rate of
existing
lenders(4)
|
|
|
29.6%
|
|
|
|
44.2%
|
|
|
|
|
|
|
|
|
|
Number of new lenders
that
made a loan
|
|
|
5086
|
|
|
|
1952
|
|
|
|
|
|
|
|
|
|
Number of lenders
that made a
loan
|
|
|
6651
|
|
|
|
3398
|
|
|
|
|
|
|
|
|
|
Re-borrowing rate of
existing
borrowers
|
|
|
98.5%
|
|
|
|
86.3%
|
|
|
|
|
|
|
|
|
|
Number of new
borrowers
|
|
|
76
|
|
|
|
17
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Number of loans
facilitated is defined as the total number of loans initially
facilitated on our marketplace during the relevant
period.
|
|
(2)
|
Number of borrowers
is defined as the total number of individual or small company
borrowers that borrowed at least one loan through our marketplace
during the relevant period.
|
|
(3)
|
Loan volume is
defined as the total principal amount of loans facilitated through
our marketplace during the relevant period.
|
|
(4)
|
Reinvestment rate is
equal to the existing lenders divided by the sum of existing
lenders and new lenders during the quarter.
|
We believe that loan volume will continue to increase as our
business grows.
The number of borrowers increased in large part because we
changed our business model to loan directly to individual and small
company borrowers rather than to the referrals from lending or
guarantee institutions because of the Interim Measures for the
Management of Business Activities of Online Lending Agencies ("P2P
Measures") , which went into effect on August 17, 2016 . Specifically, Article 3,
Section 17 of the P2P Measures limit the loans made from lending or
guarantee institutions to small amounts by regulating the upper
limits of borrowers' loan balances across multiple loaning
platforms. Individuals are limited to a loan balance of
RMB 200,000 per loaning platform, and
a total of RMB 1,000,000 across all
loaning platforms. Legal representatives or other similar entities
are limited to a loan balance of RMB
1,000,000 per loaning platform, and a total of RMB 5,000,000 across all loaning platforms. We
would expect the number of borrowers to also increase as we had the
opportunity and expect to continue to employ capital raised in our
IPO to grow our marketing efforts and capabilities.
We expect reinvestment rates to fluctuate, as they have to date,
because lenders often seek different opportunities in the market in
ways that are difficult to predict. Our reinvestment rate of
existing lenders increased in the second quarter of 2018 as we have
less new lenders invested during the quarter, which drove up the
reinvestment rate of existing lenders.
Our re-borrowing rate increased in the second quarter of 2017
through the second quarter of 2018 as we believe our loan
application process is simpler in contrast for the borrowers to go
through the loan with banks. Banks often require deposits of up to
30% to 40% of the amount borrowed. We believe that the loans we
facilitate are simple and quality credit products that make it easy
for borrowers to budget their repayment obligations and meet their
financial needs.
The above data and narrative disclosure may not accurately
predict our future results, especially since we have a limited
operating history. Our historical performance is based on a very
limited amount of time. Furthermore, during such time, we adjusted
our business model in order to comply with new regulations. In
addition, as our business grows in the future, we cannot be certain
as to whether or not historical trends will continue.
We don't have any material spending on borrower acquisition
because we attract borrowers primarily through lending and
guarantee companies that receive payments from the borrowers they
introduce to our platform. We do not pay such institutions.
However, as we expand our borrower base, these costs may increase
over time. As of the date of this report, we do not have any
material spending on borrower acquisition.
We calculate average lender acquisition costs as our total
marketing expense divided by the number of new lenders that loaned
funds through our platform. Our average lender acquisition costs,
on a quarterly basis, were as follows:
Our average lender acquisition costs, on a quarterly basis, were
as follows:
Q1 2017
|
|
$
|
159.31
|
|
Q2 2017
|
|
$
|
74.72
|
|
Q3 2017
|
|
$
|
69.30
|
|
Q4 2017
|
|
$
|
123.02
|
|
Q1 2018
|
|
$
|
141.78
|
|
Q2 2018
|
|
$
|
244.74
|
|
Overall, our lender acquisition costs have fluctuated from
$159.31 per person in the first
quarter of 2017 to $244.74 per person
in the second quarter of 2018 and we expect such trend to continue
as we keep building our brand reputation and lender base.
Results of Operations
The tables in the following discussion summarize our
consolidated statements of operations for the periods indicated.
This information should be read together with our consolidated
financial statements included elsewhere in this press release. The
operating results in any period are not necessarily of the results
that may be expected for any future period.
Revenue
Our primary sources of revenue consist of fees received for
transactions through our platform and include transaction and
management fees. The Company's operating revenues consisted of the
following:
|
|
For the
six months
ended
June 30,
2018
|
|
|
For the
six months
ended
June 30,
2017
|
|
Operating
revenues:
|
|
|
|
|
|
|
Transaction
Fees
|
|
$
|
2,496,120
|
|
|
$
|
1,240,720
|
|
Management
Fees
|
|
|
2,726,514
|
|
|
|
1,685,693
|
|
Sales
taxes
|
|
|
(314,883)
|
|
|
|
(129,043)
|
|
Total operating
revenues, net
|
|
$
|
4,907,751
|
|
|
$
|
2,797,640
|
|
Transaction Fees: Transaction fees are paid by borrowers
to the Company for the work the Company performs through its
platform. These fees are recognized as a component of operating
revenue at the time of loan issuance. The amount of these fees is
based upon the loan amount and other terms of the loan, including
credit grade, maturity and other factors. These fees are
non-refundable upon the issuance of loan.
Management Fees: Loan borrowers pay a management fee on
each loan payment to compensate us for services provided in
connection with facilitation of the loan transactions, including
review of a borrower's application with required supporting
documentation, evaluation of such borrower's credit, assessing and
verification of collaterals as well as the maintenance of profiles
in our system. The Company records management fees as a component
of operating revenue at the time of loan issuance. The amount of
these fees is based upon the loan amount and other terms of the
loan, including credit grade, maturity and other factors. These
fees are non-refundable upon the issuance of loan.
Sales Taxes: Transaction fee, management fee and license
fee that are earned and received in the PRC are subject to a
Chinese value-added tax ("VAT") at a rate of 6% starting in
April 2017 (3% prior to March 2017) of the gross proceed or at a rate
approved by the Chinese local government. Transaction fees and
management fees that are earned and received in the PRC are also
subject to various miscellaneous sales taxes at a rate of 10% of
the VAT. VAT and miscellaneous sales taxes are accounted for as
reduction of revenue.
Six Months Ended June 30, 2018
Compared to Six Months Ended June 30,
2017
Transaction Fees
|
|
For the
six months
ended
June 30,
2018
|
|
|
For the
six months
ended
June 30,
2017
|
|
|
|
|
|
|
|
|
Transaction
Fees
|
|
$
|
2,496,120
|
|
|
$
|
1,240,720
|
|
Loans
|
|
|
77,861,702
|
|
|
|
53,826,654
|
|
Average Transaction
fee in % (as a percentage of
loan principal)
|
|
|
3.2%
|
|
|
|
2.3%
|
|
Transaction fees increased $1,255,400, or 101.2% for the six months ended
June 30, 2018 from the same period in
2017. For the six months ended June 30,
2018, the average transaction fee as a percentage of the
initial principal was 3.2% and the principal amount of loans
facilitated through our platform was approximately $77.9 million. For the same period in 2017, the
average transaction fee as a percentage of the initial principal
was 2.3% and the principal amount of loans facilitated through our
platform was approximately $53.8
million. The Company increased its transaction fee rate for
the six months ended June 30, 2018 as
compared to the same period in 2017 to generate more revenues while
maintaining our borrower base with our brand recognition after
becoming a public company in the U.S.
Management Fees
|
|
For the
six months
ended
June 30,
2018
|
|
|
For the
six months
ended
June 30,
2017
|
|
|
|
|
|
|
|
|
Management
fees
|
|
$
|
2,726,514
|
|
|
$
|
1,685,963
|
|
Loans
|
|
|
77,861,702
|
|
|
|
53,826,654
|
|
Average Management
fee in % (as a percentage of
loan principal)
|
|
|
3.5%
|
|
|
|
3.1%
|
|
Management fees increased $1,040,551, or 61.7% for the six months ended
June 30, 2018 from the same period in
2017. For the six months ended June 30,
2018, the average transaction fee as a percentage of the
initial principal was 3.5% and the principal amount of loans
facilitated through our platform was approximately $77.9 million. For the same period in 2017, the
average transaction fee as a percentage of the initial principal
was 3.1% and the principal amount of loans facilitated through our
platform was approximately $53.8
million. The Company increased its management fee rate for
the six months ended June 30, 2018 as
compared to the same period in 2017 to generate more revenues while
maintaining our borrower base with our brand recognition after
becoming a public company in the U.S.
Operating Expenses
Our operating expenses consist of selling, research and
development and general and administrative expenses.
|
|
For the six months
ended
June 30,
2018
|
|
|
For the six months
ended
June 30,
2017
|
|
|
Change
|
|
|
Change (%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling
|
|
$
|
2,301,394
|
|
|
$
|
1,715,617
|
|
|
$
|
585,777
|
|
|
|
34.1%
|
|
General and
administrative
|
|
|
3,153,411
|
|
|
|
1,680,715
|
|
|
|
1,472,696
|
|
|
|
87.6%
|
|
Research and
development
|
|
|
276,946
|
|
|
|
204,691
|
|
|
|
72,255
|
|
|
|
35.3%
|
|
Total operating
expenses
|
|
$
|
5,731,751
|
|
|
$
|
3,601,023
|
|
|
$
|
2,130,728
|
|
|
|
59.2%
|
|
Selling Expenses
Selling expenses consist primarily of various marketing
expenses, including those related to lender acquisition and
retention, general brand and awareness building and salaries and
benefits expense related to our sales and marketing team.
Our major selling expenses comprised of the following items
during the respective periods as follows:
|
|
For the six months
ended
June 30,
2018
|
|
|
For the six months
ended
June 30,
2017
|
|
|
Change
|
|
|
Change (%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brand
promotion
|
|
$
|
898,381
|
|
|
$
|
507,708
|
|
|
$
|
390,673
|
|
|
|
76.9%
|
|
Incentive
|
|
$
|
795,958
|
|
|
$
|
654,403
|
|
|
$
|
141,555
|
|
|
|
21.6%
|
|
Salaries
|
|
$
|
151,590
|
|
|
$
|
91,544
|
|
|
$
|
60,046
|
|
|
|
65.6%
|
|
Our total selling expenses were $2,301,394 and $1,715,617 for the six months ended June 30, 2018 and 2017, respectively, an increase
of $585,777 or 34.1%. The increase
was primarily due to approximately $391,000 increase in promotion expenses in
connection with implementation of our marketing strategy aiming at
promoting brand recognition and attracting more lenders.
Additionally, the increase in selling expenses was also
attributable to an approximately $142,000 increase in promotional incentive that
we offered to our lenders to attract them to invest in
our platform, and the increase in salaries of approximately
$60,000 for our marketing and sales
personnel as we continue to expand our brand which we need more
personnel to perform such duty. We expect that our overall sales
and marketing expenses, including but not limited to, brand
promotion, incentive, and salaries, will continue to increase in
the foreseeable future as our business further grows.
General and Administrative Expenses
General and administrative expenses consist primarily of
salaries and benefits expenses for our accounting and finance,
business development, legal, human resources and other personnel,
and outside professional services fees and facilities expenses.
Our major general and administrative expenses comprised of the
following items during the respective periods as follows:
|
|
For the six months
ended
June 30,
2018
|
|
|
For the six months
ended
June 30,
2017
|
|
|
Change
|
|
|
Change (%)
|
|
Salaries
|
|
$
|
249,735
|
|
|
$
|
173,840
|
|
|
$
|
75,895
|
|
|
|
43.7%
|
|
Professional
fees
|
|
$
|
2,165,544
|
|
|
$
|
936,176
|
|
|
$
|
1,229,368
|
|
|
|
131.3%
|
|
Our general and administrative expenses were $3,153,411 and $1,680,715 for the six months ended June 30, 2018 and 2017, respectively, an increase
of $1,472,696 or 87.6%. The increase
was primarily due to approximately $76,000 in salary increase as we have hired more
employees due to our operating needs and an approximately
$1.2 million increase in professional
fees. We have engaged professional teams to monitor and provide
business advice on our business in the area of human resource
strategic management and business strategic management.
Additionally, we have also engaged professional teams to provide
services related to legal, audit, and financial reporting
associated with our IPO process and to retain their services
continue to be an U.S. publicly listed company. We expect our
general and administrative expenses, including but not limited to,
salaries to continue to increase in the foreseeable future as our
business further grows and our professional fees will be
maintaining at the similar level for being an U.S. publicly listed
company
Research and Development Expenses
Research and development expenses consist primarily of salaries
and benefits expenses for engineering and product management teams,
and outside contractors who work on the development and maintenance
of our platform.
Our research and development expenses were $276,946 and $204,691 for the six months ended June 30, 2018 and 2017, respectively, an increase
of $72,255 or 35.3%. The increase was
primarily driven by more investment in our platform.
Provision for Income Tax (benefit)
Tax provision generated for the six months ended June 30, 2018 decreased by $252,187 to $67,437
from tax benefit of $184,750 for the
six months ended June 30, 2017. For
the six months ended June 30, 2018,
the Company incurred an operating loss of $675,817 and recorded a deferred tax benefit
resulting from the net operating losses totaling $20,227.
Net Loss
Net loss for the six months ended June
30, 2018 was $743,254 as
compared to net loss of $601,405 for
the same period in 2017, a change of $141,849. Such change was the result of the
combination of items as discussed above.
Foreign Currency Translation Adjustment
Changes in foreign currency translation adjustment are mainly
due to the fluctuation of foreign exchange rates between RMB (the
functional currency of WFOE and our VIEs).
Foreign currency translation adjustment decreased to
$158,319 for the six months ended
June 30, 2018 from gain amounted to
$206,308 for the same period in 2017
mainly due to RMB depreciated against USD, which resulted in
foreign currency translation loss.
Liquidity and Capital Resources
To date, we have financed our operations primarily through cash
flows from operations, proceeds from private placements and initial
public offering.
We incurred net losses of approximately $997,000 for the year ended December 31, 2017. We incurred net losses of
approximately $743,000 for the six
months ended June 30, 2018. We had
approximately $10.6 million of cash,
cash equivalents and restricted cash as of June 30, 2018. We intend to continue to use these
funds to grow our business primarily by:
|
●
|
enhancing our
marketing efforts in order to increase awareness of our marketplace
among potential lenders throughout China; and
|
|
●
|
increasing our
efforts to expand our borrower base by utilizing social networks
and e-commerce platforms.
|
We believe that our current working capital is sufficient to
support our operations for the next twelve months from the date of
this press release.
Cash Flows
As of June 30, 2018, we had cash,
cash equivalents and restricted cash of approximately $10.6 million as compared to $5.5 million as of December 31, 2017. The table below sets forth a
summary of our cash flows for the periods indicated:
|
|
For the six
months
ended
June 30,
2018
|
|
|
For the six
months
ended
June 30,
2017
|
|
Net cash used in
operating activities
|
|
$
|
(487,710)
|
|
|
$
|
(1,948,687)
|
|
Net cash used in
investing activities
|
|
$
|
(3,894)
|
|
|
$
|
(16,808)
|
|
Net cash provided by
financing activities
|
|
$
|
5,720,210
|
|
|
$
|
-
|
|
Operating Activities
Net cash used in operating activities was approximately
$0.5 million for the six months ended
June 30, 2018, which was attributable
primarily to a net loss of approximately $0.7 million, an approximate $0.1 million of employee advances paid to cover
business expenses, an approximate $50,000 paid for prepaid marketing and promotions
services as our service providers required for such prepayments
prior such services can be performed, and the decrease of
approximately $40,000 of other
payables and accrued liabilities. The cash outflows were offset by
the non-cash amortization of stock compensation expenses of
approximately $0.5 million with fair
value of ordinary shares issued to our consultants for
approximately $2.0 million.
Investing Activities
Net cash used in investing activities was approximately
$4,000 for the six months ended
June 30, 2018, which was attributable
primarily to $4,000 additional
purchases of office equipment.
Financing Activities
Net cash provided by financing activities was approximately
$5.7 million for the six months ended
June 30, 2018, which was attributable
to approximately $5.7 million
proceeds from issuance of ordinary shares through IPO.
Statement Regarding Unaudited Financial Information
The unaudited financial information set forth above is subject
to adjustments that may be identified when audit work is performed
on the Company's year-end financial statements, which could result
in significant differences from this unaudited financial
information.
About Golden Bull Limited
Headquartered in Shanghai,
China, Golden Bull Limited (NASDAQ: DNJR) operates an online
finance marketplace, or a "peer-to-peer" lending platform, that
connects individual lenders with individual and small business
borrowers. The loans that we are currently arranging generally
range from 30 days to 360 days, and are secured by borrowers'
automobiles. Our business abides by the conventions of The Online
Financing Overdue Debt Collection Self-Discipline Convention
(Trial) (the "Convention"), which went into effect on March 29, 2018. The Convention regulates the
collection of overdue online financing debts, and establishes the
basic principles of obeying laws and regulations, standardizing
prudence, protecting privacy, and strict self-discipline, from
disciplinary punishment, business management, personnel management,
information management, and outsourcing. Because we have a very low
rate of overdue debt and have not engaged in any illegal
collections, the Convention has no material impact on the Company's
business. For more information about the Company,
please visit: www.dianniu98.com.
Safe Harbor Statement
This press release contains forward-looking statements as
defined by the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include statements concerning plans,
objectives, goals, strategies, future events or performance, and
underlying assumptions and other statements that are other than
statements of historical facts. When the Company uses words such as
"may, "will, "intend," "should," "believe," "expect," "anticipate,"
"project," "estimate" or similar expressions that do not relate
solely to historical matters, it is making forward-looking
statements. Forward-looking statements are not guarantees of
future performance and involve risks and uncertainties that may
cause the actual results to differ materially from the Company's
expectations discussed in the forward-looking statements. These
statements are subject to uncertainties and risks including, but
not limited to, the following: the Company's goals and
strategies; the Company's future business development; product and
service demand and acceptance; changes in technology; economic
conditions; reputation and brand; the impact of competition and
pricing; government regulations; fluctuations in general economic
and business conditions in China
and assumptions underlying or related to any of the foregoing and
other risks contained in reports filed by the Company with the
Securities and Exchange Commission. For these reasons, among
others, investors are cautioned not to place undue reliance upon
any forward-looking statements in this press release. Additional
factors are discussed in the Company's filings with the U.S.
Securities and Exchange Commission, which are available for review
at www.sec.gov. The Company undertakes no obligation to publicly
revise these forward-looking statements to reflect events or
circumstances that arise after the date hereof.
For more information, please contact:
At the Company:
Maggie Liu
Email: liuyan@dianniu98.com
GOLDEN BULL LIMITED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
|
|
June 30,
|
|
|
December 31,
|
|
|
|
2018
|
|
|
2017
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
9,996,358
|
|
|
$
|
5,456,778
|
|
Other
receivables
|
|
|
358,224
|
|
|
|
258,415
|
|
Prepaid
expenses
|
|
|
1,784,977
|
|
|
|
1,936,887
|
|
Prepaid IPO
costs
|
|
|
-
|
|
|
|
2,404,580
|
|
Total current
assets
|
|
|
12,139,559
|
|
|
|
10,056,660
|
|
|
|
|
|
|
|
|
|
|
PROPERTY AND
EQUIPMENT, NET
|
|
|
66,830
|
|
|
|
83,522
|
|
|
|
|
|
|
|
|
|
|
OTHER
ASSETS
|
|
|
|
|
|
|
|
|
Restricted
cash
|
|
|
600,000
|
|
|
|
-
|
|
Prepaid
expenses
|
|
|
2,134,046
|
|
|
|
2,472,186
|
|
Deferred tax
assets
|
|
|
316,490
|
|
|
|
302,320
|
|
Total other
assets
|
|
|
3,050,536
|
|
|
|
2,774,506
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
|
15,256,925
|
|
|
$
|
12,914,688
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
|
|
|
Other payables and
accrued liabilities
|
|
$
|
384,370
|
|
|
$
|
433,585
|
|
Taxes
payable
|
|
|
5,968
|
|
|
|
35,647
|
|
Total current
liabilities
|
|
|
390,338
|
|
|
|
469,232
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
390,338
|
|
|
|
469,232
|
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND
CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
|
Ordinary shares,
$0.01 par value, 50,000,000 shares
authorized, 14,782,500 and 13,000,000 shares
issued and outstanding of June 30, 2018 and
December 31, 2017*
|
|
|
147,825
|
|
|
|
130,000
|
|
Shares subscription
receivables
|
|
|
(45,457)
|
|
|
|
(45,457)
|
|
Additional paid-in
capital
|
|
|
15,617,707
|
|
|
|
12,312,828
|
|
Statutory
reserves
|
|
|
6,189
|
|
|
|
6,189
|
|
Accumulated
deficit
|
|
|
(1,641,848)
|
|
|
|
(893,921)
|
|
Accumulated other
comprehensive income
|
|
|
183,092
|
|
|
|
330,706
|
|
Total shareholders'
equity
|
|
|
14,267,508
|
|
|
|
11,840,345
|
|
|
|
|
|
|
|
|
|
|
NONCONTROLLING
INTEREST
|
|
|
599,079
|
|
|
|
605,111
|
|
|
|
|
|
|
|
|
|
|
Total shareholders'
equity
|
|
|
14,866,587
|
|
|
|
12,445,456
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$
|
15,256,925
|
|
|
$
|
12,914,688
|
|
* Giving retroactive effect to the 260 for 1 split effected on
November 3, 2017.
GOLDEN BULL LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSS
(UNAUDITED)
|
|
For the Six Months
Ending
June 30,
|
|
|
|
2018
|
|
|
2017
|
|
|
|
|
|
|
|
|
OPERATING
REVENUES
|
|
|
|
|
|
|
Transaction
Fees
|
|
$
|
2,496,120
|
|
|
$
|
1,240,720
|
|
Management
Fees
|
|
|
2,726,514
|
|
|
|
1,685,963
|
|
Sales
taxes
|
|
|
(314,883)
|
|
|
|
(129,043)
|
|
Total operating
revenues, net
|
|
|
4,907,751
|
|
|
|
2,797,640
|
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES
|
|
|
|
|
|
|
|
|
Selling
|
|
|
(2,301,394)
|
|
|
|
(1,715,617)
|
|
General and
administrative
|
|
|
(3,153,411)
|
|
|
|
(1,680,715)
|
|
Research and
development
|
|
|
(276,946)
|
|
|
|
(204,691)
|
|
Total operating
expenses
|
|
|
(5,731,751)
|
|
|
|
(3,601,023)
|
|
|
|
|
|
|
|
|
|
|
LOSS FROM
OPERATIONS
|
|
|
(824,000)
|
|
|
|
(803,383)
|
|
|
|
|
|
|
|
|
|
|
OTHER INCOME
(EXPENSE)
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
19,799
|
|
|
|
6,140
|
|
Other finance
expenses
|
|
|
(1,019)
|
|
|
|
(1,187)
|
|
Other income
(expenses)
|
|
|
129,403
|
|
|
|
12,275
|
|
Total other income,
net
|
|
|
148,183
|
|
|
|
17,228
|
|
|
|
|
|
|
|
|
|
|
LOSS BEFORE INCOME
TAXES
|
|
|
(675,817)
|
|
|
|
(786,155)
|
|
|
|
|
|
|
|
|
|
|
PROVISION (BENEFIT)
FOR INCOME TAX
|
|
|
|
|
|
|
|
|
Current
|
|
|
87,664
|
|
|
|
10,361
|
|
Deferred
|
|
|
(20,227)
|
|
|
|
(195,111)
|
|
Total provision
(benefit) for income tax
|
|
|
67,437
|
|
|
|
(184,750)
|
|
|
|
|
|
|
|
|
|
|
NET LOSS
|
|
|
(743,254)
|
|
|
|
(601,405)
|
|
|
|
|
|
|
|
|
|
|
Less: Net income
(loss) attributable to noncontrolling
interest
|
|
|
4,673
|
|
|
|
(63,050)
|
|
|
|
|
|
|
|
|
|
|
NET LOSS ATTRIBUTABLE
TO GOLDEN BULL
LIMITED
|
|
$
|
(747,927)
|
|
|
$
|
(538,355)
|
|
|
|
|
|
|
|
|
|
|
NET LOSS
|
|
$
|
(743,254)
|
|
|
$
|
(601,405)
|
|
|
|
|
|
|
|
|
|
|
OTHER COMPREHENSIVE
INCOME (LOSS)
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustment
|
|
|
(158,319)
|
|
|
|
206,308
|
|
|
|
|
|
|
|
|
|
|
COMPREHENSIVE
LOSS
|
|
|
(901,573)
|
|
|
|
(395,097)
|
|
|
|
|
|
|
|
|
|
|
Less: Comprehensive
loss attributable to
noncontrolling interest
|
|
|
(6,032)
|
|
|
|
(40,646)
|
|
|
|
|
|
|
|
|
|
|
COMPREHENSIVE LOSS
ATTRIBUTABLE TO
GOLDEN BULL LIMITED
|
|
$
|
(895,541)
|
|
|
$
|
(354,451)
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE
NUMBER OF ORDINARY
SHARES
|
|
|
|
|
|
|
|
|
Basic and
diluted*
|
|
|
13,972,625
|
|
|
|
527,757
|
|
|
|
|
|
|
|
|
|
|
EARNINGS (LOSS) PER
SHARE
|
|
|
|
|
|
|
|
|
Basic and
diluted*
|
|
$
|
(0.05)
|
|
|
$
|
(1.02)
|
|
* Giving retroactive effect to the 260 for 1 split effected on
November 3, 2017.
GOLDEN BULL LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS
(UNAUDITED)
|
|
For the six months
ended
June 30,
|
|
|
|
2018
|
|
|
2017
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
|
|
|
Net loss
|
|
$
|
(743,254)
|
|
|
$
|
(601,405)
|
|
Adjustments to
reconcile net loss to net cash used in
operating activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
19,728
|
|
|
|
24,310
|
|
Loss on disposal of
equipment
|
|
|
-
|
|
|
|
141
|
|
Deferred tax
benefit
|
|
|
(20,227)
|
|
|
|
(195,111)
|
|
Amortization of stock
compensation expenses for
services
|
|
|
488,334
|
|
|
|
-
|
|
Change in operating
assets and liabilities
|
|
|
|
|
|
|
|
|
Other
receivables
|
|
|
(108,461)
|
|
|
|
(97,946)
|
|
Prepaid
expenses
|
|
|
(50,341)
|
|
|
|
(783,704)
|
|
Security
deposits
|
|
|
-
|
|
|
|
(550,751)
|
|
Other payables and
accrued liabilities
|
|
|
(43,283)
|
|
|
|
328,297
|
|
Deferred
revenues
|
|
|
-
|
|
|
|
8,963
|
|
Deferred rent
liabilities
|
|
|
-
|
|
|
|
(6,590)
|
|
Taxes
payable
|
|
|
(30,206)
|
|
|
|
(74,891)
|
|
Net cash used in
operating activities
|
|
|
(487,710)
|
|
|
|
(1,948,687)
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Purchases of property
and equipment
|
|
|
(3,894)
|
|
|
|
(34,368)
|
|
Cash acquired through
variable interest entity
|
|
|
-
|
|
|
|
17,560
|
|
Net cash used in
investing activities
|
|
|
(3,894)
|
|
|
|
(16,808)
|
|
|
|
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Proceeds from
issuance of ordinary shares through
IPO, net
|
|
|
5,720,210
|
|
|
|
-
|
|
Net cash provided by
financing activities
|
|
|
5,720,210
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
EFFECT OF EXCHANGE
RATE ON CASH
|
|
|
(89,026)
|
|
|
|
152,390
|
|
|
|
|
|
|
|
|
|
|
INCREASE/(DECREASE)
IN CASH
|
|
|
5,139,580
|
|
|
|
(1,813,105)
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH
EQUIVALENTS, AND
RESTRICTED CASH, beginning of period
|
|
|
5,456,778
|
|
|
|
7,378,920
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH
EQUIVALENTS, AND
RESTRICTED CASH, end of period
|
|
$
|
10,596,358
|
|
|
$
|
5,565,815
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL CASH
FLOW INFORMATION:
|
|
|
|
|
|
|
|
|
Cash paid for income
tax
|
|
$
|
87,664
|
|
|
$
|
10,361
|
|
|
|
|
|
|
|
|
|
|
NON-CASH TRANSACTIONS
OF INVESTING
AND FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
Variable interest
entity acquired and contributed by
shareholders
|
|
$
|
-
|
|
|
$
|
17,853
|
|
Issuance of ordinary
shares to service providers
|
|
$
|
-
|
|
|
$
|
4,030,000
|
|
Prepaid IPO costs to
be net against IPO proceeds
|
|
$
|
2,397,506
|
|
|
$
|
-
|
|
View original
content:http://www.prnewswire.com/news-releases/golden-bull-limited-reports-six-months-ended-june-30-2018-financial-results-300721367.html
SOURCE Golden Bull Limited