HANZHONG, China, May 18, 2021 /PRNewswire/ -- China HGS Real Estate Inc. (NASDAQ: HGSH) ("China HGS" or the "Company"), a leading regional real estate developer headquartered in Hanzhong City, Shaanxi Province, China, announced its interim financial results for the first half of fiscal 2021 ended March 31, 2021.

Second Quarter Fiscal 2021 Highlights

  • Total revenues for the second quarter of fiscal 2021 were approximately $18.3 million, representing an increase of 867.2% from approximately $1.9 million in the same quarter of fiscal 2020 due to more gross floor area sold during the current quarter.
  • Net income for the second quarter of fiscal 2021 totaled approximately $2.2 million, significantly increased from net loss of approximately $0.6 million in the same period of last year.
  • Basic and diluted net income per share attributable to shareholders for the second quarter of fiscal 2021 increased to $0.10, compared to net loss per share of $0.01 for the same quarter of the last year.  

First Six Months of Fiscal 2021 Highlights

  • Total revenues for the first six months of fiscal 2021 were approximately $21.0 million, representing an increase of 401.5% from approximately $4.2 million in the same period of fiscal 2020.
  • Net income for the first six months of fiscal 2021 totaled approximately $2.5 million, significantly increased from net loss of approximately $0.9 million in the same period of last year.
  • Basic and diluted net income per share attributable to shareholders for the second quarter of fiscal 2021 increased to $0.11, compared to net loss per share of $0.02 for the same period of the last year.  

Safe Harbor Statement

This press release contains forward-looking statements, which are subject to change. The forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All "forward-looking statements" relating to the business of China HGS Real Estate Inc., which can be identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties which could cause actual results to differ. These factors include but are not limited to: the uncertain market for the Company's business, macroeconomic, technological, regulatory, or other factors affecting the profitability of real estate business; and other risks related to the Company's business and risks related to operating in China. Please refer to the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2020, for specific details on risk factors. Given these risks and uncertainties, you are cautioned not to place undue reliance on forward-looking statements. The Company's actual results could differ materially from those contained in the forward-looking statements. The Company undertakes no obligation to revise or update its forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.

About China HGS Real Estate, Inc.

China HGS Real Estate, Inc. (NASDAQ: HGSH), founded in 1995 and headquartered in Hanzhong City, Shaanxi Province, is a leading real estate developer in the region and holds the national grade I real estate qualification. The Company focuses on the development of high-rise, sub-high-rise residential buildings and multi-building apartment complexes in China's Tier 3 and Tier 4 cities and counties with rapidly growing populations driven by increased urbanization. The Company provides affordable housing with popular and modern designs to meet the needs of multiple buyer groups. The Company's development activity spans a range of services, including land acquisition, project planning, design management, construction management, sales and marketing, and property management. For further information about China HGS, please go to www.chinahgs.com. 

Company contact:

Randy Xiong, President of Capital Market
China Phone: (86) 091-62622612
Email: randy.xiong@chinahgs.com

 

 

CHINA HGS REAL ESTATE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

















March 31,



September 30,




2021



2020


ASSETS



(Unaudited)






Cash


$

555,576



$

457,699


Restricted cash



3,297,734




3,409,837


Contract assets



15,195,730




14,255,328


Real estate property development completed



93,359,420




94,671,258


Other assets



9,709,848




8,132,555


Property, plant and equipment, net



567,292




571,330


Security deposits



1,922,853




1,855,506


Real estate property under development



251,151,767




227,741,017


Due from local governments for real estate property development completed



2,973,777




2,869,623











Total Assets


$

378,733,997



$

353,964,153











LIABILITIES AND STOCKHOLDERS' EQUITY









Construction loans


$

116,060,624



$

109,937,408


Accounts payable



31,854,281




25,415,352


Other payables



4,569,384




4,028,048


Construction deposits



3,318,974




3,202,730


Contract liabilities



1,885,982




1,847,685


Customer deposits



21,498,027




19,405,528


Accrued expenses



1,861,745




1,920,370


Taxes payable



20,592,607




19,881,211


Total liabilities



201,641,624




185,638,332











Commitments and Contingencies









Stockholders' equity









Common stock, $0.001 par value, 50,000,000 shares authorized, 22,525,000 shares issued and
outstanding March 31, 2021 and September 30, 2020



22,525




22,525


Additional paid-in capital



129,930,330




129,930,330


Statutory surplus



10,458,395




10,458,395


Retained earnings



37,466,885




34,954,061


Accumulated other comprehensive loss



(785,762)




(7,039,490)


Total stockholders' equity



177,092,373




168,325,821











Total Liabilities and Stockholders' Equity


$

378,733,997



$

353,964,153


 

 

CHINA HGS REAL ESTATE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(Unaudited)

















Three months ended March 31,



Six months ended March 31,




2021



2020



2021



2020


Real estate sales


$

18,278,112



$

1,889,829



$

21,033,374



$

4,194,073


Less: Sales tax



(115,166)




(27,048)




(138,704)




(66,281)


Cost of real estate sales



(14,474,264)




(1,466,381)




(16,327,906)




(3,171,993)


Gross profit



3,688,682




396,400




4,566,764




955,799


Operating expenses

















Selling and distribution expenses



16,821




200,390




96,166




400,558


General and administrative expenses



543,334




819,415




849,259




1,408,254


Total operating expenses



560,155




1,019,805




945,425




1,808,812


Operating income (loss)



3,128,527




(623,405)




3,621,339




(853,013)


Interest income (expense), net



712




(15,586)




3,537




(32,839)


Other expense



(166,571)




(96,729)




(272,428)




(96,729)


Income (loss) before income taxes



2,962,668




(735,720)




3,352,448




(982,581)


Provision (benefit) for income taxes



741,431




(111,699)




839,624




(101,179)


Net income (loss)



2,221,237




(624,021)




2,512,824




(881,402)


Other Comprehensive income (loss)

















Foreign currency translation adjustment



(737,431)




(2,823,145)




6,253,728




1,557,717


Comprehensive income (loss)


$

1,483,806



$

(3,447,166)



$

8,766,552



$

676,315


Basic and diluted income (loss) per common share

















Basic and diluted


$

0.10



$

(0.01)



$

0.11



$

(0.02)


Weighted average common shares outstanding

















Basic and diluted



22,525,000




22,525,000




22,525,000




22,525,000




The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

CHINA HGS REAL ESTATE INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)









































Common Stock



Additional



Statutory



Retained



Accumulated
Other

Comprehensive







Shares



Amount



Paid-in Capital



Surplus



Earnings



Income (loss)



Total


Balance at September 30, 2019



22,525,000



$

22,525



$

129,930,330



$

10,360,251



$

34,070,767



$

(15,683,723)



$

158,700150


Net loss for the period



-




-












(257,381)








(257,381)


Foreign currency translation adjustments



-




-
















4,380,862




4,380,862


Balance at December 31, 2019



22,525,000




22,525




129,930,330




10,360,251




33,189,365




(11,302,861)




162,823,631


Net loss for the period



-




-












(624,021)








(624,021)


Foreign currency translation adjustments



-




-
















(2,823,145)




(2,823,145)


Balance at March 31, 2020



22,525,000



$

22,525



$

129,930,330



$

10,360,251



$

33,189,365



$

(14,126,006)



$

159,376,465




























































Balance at September 30, 2020



22,525,000



$

22,525



$

129,930,330



$

10,458,395



$

34,954,061



$

(7,039,490)



$

168,325,821


Net income for the period



-




-




-




-




291,587




-




291,587


Foreign currency translation
adjustments



-




-




-




-




-




6,991,159




6,991,159


Balance at December 31, 2020



22,525,000




22,525




129,930,330




10,458,395




35,245,648




(48,331)




175,608,567


Net income for the period



-




-




-




-




2,221,237




-




2,221,237


Foreign currency translation
adjustments



-




-




-




-




-




(737,431)




(737,431)


Balance at March 31, 2021



22,525,000



$

22,525



$

129,930,330



$

10,458,395



$

37,466,885



$

(785,762)



$

177,092,373




The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

 

CHINA HGS REAL ESTATE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)











Six months ended March 31,




2021



2020


Cash flows from operating activities









Net income (loss)


$

2,512,824



$

(881,402)


Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:









Deferred tax provision (benefit)



-




(235,179)


Depreciation



24,772




37,710


Changes in operating assets and liabilities:









Contract assets



(422,948)




651,289


Real estate property development completed



4,747,385




2,937,724


Real estate property under development



(13,010,220)




(2,835,288)


Other current assets



(1,281,964)




(935,053)


Security deposit







3,195,887


Accounts payable



5,515,797




89,325


Other payables



395,088




111,347


Contract liabilities



(28,762)




(71,507)


Customer deposits



1,387,999




2,349,028


Construction deposits







(428)


Accrued expenses







(675,478)


Taxes payables



109,454




(1,379,060)


Net cash (used in) provided by operating activities



(50,575)




2,358,915











Cash flow from financing activities









Repayments of construction loans



-




(2,128,585)


Net cash used in financing activities



-




(2,128,585)











Effect of changes of foreign exchange rate on cash and restricted cash



36,349




103,801


Net (decrease) increase in cash and restricted cash



(14,226)




334,131


Cash and restricted cash, beginning of period



3,867,536




4,202,117


Cash and restricted cash, end of period


$

3,853,310



$

4,536,248


Supplemental disclosures of cash flow information:









Interest paid


$

1,847,904



$

3,416,592


Income taxes paid


$

135,462



$

375,601











Reconciliation to amounts on condensed consolidated balance sheets:









Cash


$

555,576



$

658,313


Restricted


$

3,297,734



$

3,877,935


Total cash and restricted cash


$

3,853,310



$

4,536,248











Cash, beginning of period


$

457,699



$

263,139


Restricted, beginning of period


$

3,409,837



$

3,938,978


Total cash and restricted cash, beginning of period


$

3,867,536



$

4,202,117











Non-cash financing activities:









Reclassification of interest payable to construction loan


$

1,626,210



$

-


Real estate sales for settlements in real estate property under development


$

(14,432,275)



$

-




The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

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SOURCE China HGS Real Estate Inc.

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