BEIJING, Aug. 19, 2019 (GLOBE NEWSWIRE) -- Bat Group, Inc. (Nasdaq: GLG) (the "Company"), an emerging used luxurious car rental service provider headquartered in Beijing, China, today announced its financial results for the second fiscal quarter ended June 30, 2019.
Mr. Jiaxi Gao, CEO and President of Bat Group, Inc., comments, “We are pleased to report our financial results for the second quarter of 2019. For the six months ended June 30, 2019 we increased our income from operating lease from $96,721 to $940,894 as we grew our luxurious car rental business. We will continue to allocate our resources into growth as we plan to increase our inventory of high-end cars and expand our operations into other cities in China for the remaining two quarters of 2019. We are optimistic that customers will respond positively to our brand and high-quality services as we continue our expansion.”
Second Quarter of 2019 Financial Highlights
- Income from operating lease increased by 456% to $0.54 million, from $0.10 million for the second quarter of 2018.
- Net income from discontinued operations was nil, compared with $9.90 million for the second quarter of 2018.
- Net loss was $1.04 million, compared with net income of $9.50 million for the second quarter of 2018.
- Basic and diluted loss per share was $0.14, compared with basic and diluted earnings per share of $2.14 for the second quarter of 2018.
Six Months Ended June 30, 2019 Financial Highlights
- Income from operating lease increased by 873% to $0.94 million, from $0.10 million for the six months ended June 30, 2018.
- Net income from discontinued operations was nil, compared with $10.07 million for the six months ended June 30, 2018.
- Net loss was $2.87 million, compared with net income of $9.12 million for the six months ended June 30, 2018.
- Basic and diluted loss per share was $0.45, compared with basic and diluted earnings per share of $2.16 for the six months ended June 30, 2018.
Second Quarter of 2019 Financial Results
Income from operating lease
Income from operating lease increased by $0.44 million, or 456% to $0.54 for the three months ended June 30, 2019 from $0.10 million for the same period of last year. The increase was mainly attributable to increased number of owned used luxurious cars, and diversified lease income generated from both owned cars and leased cars.
Operating lease expenses
The cost of operating lease was comprised of car related expenses arising from lease of cars. With diversified lease income generated from leased cars which was launched in January 2019, the Company recorded car related expenses of $0.32 million.
Depreciation expenses on operating lease assets
The depreciation expenses on operating lease assets increased by $42,863, or 344% to $55,321 for the three months ended June 30, 2019, from $12,458 for the same period of last year. The increase was mainly caused by the Company’s continuous investments in used luxurious cars. As of June 30, 2019, the Company had thirteen used luxurious cars, as compared with six cars as of June 30, 2018.
Selling, general, and administrative expenses
Selling, general, and administrative expenses increased by $0.70 million, or 152% to $1.16 million for the three months ended June 30, 2019, from $0.46 million for the same period of last year. Operating expenses primarily consisted of salary and employee surcharge, office rental expense, business tax and surcharge, changes in fair value of other noncurrent liabilities, professional service fees, and other office supplies. The increase was mainly attributable to combined effects of an increase in promotion expenses of $53,129, an increase in car-related expenses of $97,091 and expenses incurred for direct offering in April and May 2019, consisting of an increase of audit related fees of $161,815, an increase of commission of $100,000 to a third party vendor for referral of underwriters, and other expenses of $132,575.
Net income from discontinued operations
During the three months ended June 30, 2018, the net income was comprised of a net income of $0.10 million from discontinued operations of microcredit service and a gain of $9.79 million from disposal of the discontinued operations of microcredit service.
Net (loss)income
Net loss was $1.04 million for the three months ended June 30, 3019, compared with net income of $9.50 million for the same period of last year. Basic and diluted loss per share was $0.14 for the three months ended June 30, 2019, compared with basic and diluted earnings per share of $2.14 for the same period of last year.
Six Months Ended June 30, 2019 Financial Results
Income from operating lease
Income from operating lease increased by $0.84 million, or 873% to $0.94 for the six months ended June 30, 2019 from $0.10 million for the same period of last year. The increase was mainly attributable to increased number of owned used luxurious cars, and diversified lease income generated from both owned cars and leased cars.
Operating lease expenses
The cost of operating lease was comprised of car related expenses arising from lease of cars. With diversified lease income generated from leased cars which was launched in January 2019, the Company recorded car related expenses of $0.53 million for the six months ended June 30, 2019.
Depreciation expenses on operating lease assets
The depreciation expenses on operating lease assets increased by $89,721, or 720% to $102,179 for the three months ended June 30, 2019, from $12,458 for the same period of last year. The increase was mainly caused by the Company’s continuous investments in used luxurious cars. As of June 30, 2019, the Company had thirteen used luxurious cars, as compared with six cars as of June 30, 2018.
Selling, general, and administrative expenses
Selling, general, and administrative expenses increased by $2.17 million, or 248% to $3.04 million for the six months ended June 30, 2019, from $0.87 million for the same period of last year. Operating expenses primarily consisted of salary and employee surcharge, office rental expense, business tax and surcharge, changes in fair value of other noncurrent liabilities, professional service fees, and other office supplies. The increase was mainly attributable to combined effects The increase was mainly attributable to combined effects of an increase of promotion expenses of $96,250, an increase of car-related expenses of $143,485, an increase of legal and consulting expenses of $1,284,101 as a result of issuance of 502,391 restricted shares as compensations to service providers, and expenses incurred for direct offering in April and May 2019, consisting of an increase of audit related fees of $192,378, an increase of commission of $100,000 to a third party vendor for referral of underwriters, and other expenses of $194,004.
Net income from discontinued operations
During the six months ended June 30, 2018, the net income was comprised of a net income of $0.28 million from discontinued operations of microcredit service and a gain of $9.79 million from disposal of the discontinued operations of microcredit service.
Net (loss) income
Net loss was $2.87 million for the six months ended June 30, 3019, compared with net income of $9.12 million for the same period of last year. Basic and diluted loss per share was $0.45 for the six months ended June 30, 2019, compared with basic and diluted earnings per share of $2.16 for the same period of last year.
Financial Conditions
As of June 30, 2019, the Company had cash and cash equivalents of $1.31 million, compared with $1.48 million as of December 31, 2018.
Net cash used in operating activities was $1.74 million for the six months ended June 30, 2019, compared to $0.03 million for the same period of last year.
Net cash used in investing activities was $5.10 million for the six months ended June 30, 2019, compared to $3.23 million for the same period of last year.
Net cash provided by financing activities was $6.72 million for the six months ended June 30, 2019, compared to $3.27 million for the same period of last year.
About Bat Group, Inc.
Bat Group, Inc. (Nasdaq: GLG) is an emerging used luxurious car rental service provider in China. The used luxurious car business is conducted under the brand name “BatCar” by the Company’s VIE entity, Tianxing Kunlun Technology Co. Ltd, from its headquarters in Beijing. Utilizing a streamlined, digital, transaction process, the Company endeavors to provide the best possible rental experience for its customers. For more information please visit ir.imbatcar.com
Safe Harbor Statement
This press release may contain certain "forward-looking statements" relating to the business of China Commercial Credit, Inc. and its subsidiary companies. All statements, other than statements of historical fact included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
For more information, please contact:
Ms. Tina Xiao
Ascent Investor Relations LLC
Email: tina.xiao@ascent-ir.com
BAT GROUP, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
| June 30, | December 31, | |||||||
| 2019 | 2018 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Cash | $ | 1,307,186 | $ | 1,484,116 | ||||
| Loans receivable from third parties | 1,103,769 | - | ||||||
| Other current assets | 159,753 | 87,922 | ||||||
| Total current assets | 2,570,708 | 1,572,038 | ||||||
| Investment security | 200,000 | - | ||||||
| Deposits for investments in equity investees | 582,513 | |||||||
| Investment in an equity investee | 291,256 | - | ||||||
| Investments in financial products | 1,000,000 | - | ||||||
| Property and equipment, net | 5,090 | 5,524 | ||||||
| Right-of-use lease assets, net | 63,481 | - | ||||||
| Prepayments for operating lease assets | 235,918 | - | ||||||
| Operating lease assets, net | 3,085,073 | 1,634,018 | ||||||
| Total noncurrent assets | 5,463,331 | 1,639,542 | ||||||
| Total Assets | $ | 8,034,039 | $ | 3,211,580 | ||||
| LIABILITIES AND EQUITY | ||||||||
| Advances from customers | $ | 39,319 | $ | 6,208 | ||||
| Third parties loans | 2,257,237 | 218,100 | ||||||
| Operating lease liabilities | 63,481 | - | ||||||
| Due to a related party | 8,254 | - | ||||||
| Other current liabilities | 213,052 | 185,049 | ||||||
| Total Liabilities | 2,581,343 | 409,357 | ||||||
| Commitments and Contingencies | ||||||||
| Shareholders’ Equity | ||||||||
| Series A Preferred Stock (par value $0.001 per share, 1,000,000 shares authorized at June 30, 2019 and December 31, 2018, respectively; nil shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively) | $ | - | $ | - | ||||
| Series B Preferred Stock (par value $0.001 per share, 5,000,000 shares authorized at June 30, 2019 and December 31, 2018, respectively; nil shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively) | - | - | ||||||
| Common stock (par value $0.001 per share, 100,000,000 shares authorized; 8,646,297 and 5,023,906 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively)* | 8,646 | 5,024 | ||||||
| Additional paid-in capital | 34,299,372 | 28,765,346 | ||||||
| Accumulated deficit | (28,326,750 | ) | (25,457,090 | ) | ||||
| Accumulated other comprehensive loss | (528,081 | ) | (511,057 | ) | ||||
| Total BAT Group, Inc.’s Shareholders’ Equity | 5,453,187 | 2,802,223 | ||||||
| Non-controlling interests | (491 | ) | - | |||||
| Total Equity | 5,452,696 | 2,802,223 | ||||||
| Total Liabilities and Equity | $ | 8,034,039 | $ | 3,211,580 | ||||
BAT GROUP, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE (LOSS) INCOME
| For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||||||
| 2019 | 2018 | 2019 | 2018 | |||||||||||||
| Income from operating lease | $ | 540,895 | $ | 96,721 | $ | 940,894 | $ | 96,721 | ||||||||
| Operating expenses | ||||||||||||||||
| Operating lease expenses | 318,947 | - | 533,010 | - | ||||||||||||
| Depreciation expenses on operating lease assets | 55,321 | 12,458 | 102,179 | 12,458 | ||||||||||||
| Selling, general, and administrative expenses | 1,157,227 | 458,390 | 3,040,276 | 873,277 | ||||||||||||
| Changes in fair value of noncurrent liabilities | - | 19,000 | - | 166,540 | ||||||||||||
| Impairment on operating lease assets | - | - | 96,318 | - | ||||||||||||
| Total operating expenses | 1,531,495 | 489,848 | 3,771,783 | 1,052,275 | ||||||||||||
| Other (expenses) income, net | ||||||||||||||||
| Interest (expenses) income | (49,725 | ) | 315 | (39,262 | ) | 315 | ||||||||||
| Total other (expenses) income, net | (49,725 | ) | 315 | (39,262 | ) | 315 | ||||||||||
| Net loss from continuing operations before income taxes | (1,040,325 | ) | (392,812 | ) | (2,870,151 | ) | (955,239 | ) | ||||||||
| Income tax expenses | - | (20 | ) | - | (20 | ) | ||||||||||
| Net loss from continuing operations | $ | (1,040,325 | ) | $ | (392,832 | ) | $ | (2,870,151 | ) | $ | (955,259 | ) | ||||
| Net income from discontinued operations | - | 9,896,100 | - | 10,072,629 | ||||||||||||
| Net (loss) income | $ | (1,040,325 | ) | $ | 9,503,268 | $ | (2,870,151 | ) | $ | 9,117,370 | ||||||
| Less: Net loss attributable to non-controlling interests | 491 | - | 491 | - | ||||||||||||
| Net (loss) income attributable to BAT Group, Inc.’s Shareholders | $ | (1,039,834 | ) | $ | 9,503,268 | $ | (2,869,660 | ) | $ | 9,117,370 | ||||||
| Comprehensive (loss) income | ||||||||||||||||
| Net (loss) income | $ | (1,040,325 | ) | $ | 9,503,268 | $ | (2,870,151 | ) | $ | 9,117,370 | ||||||
| Foreign currency translation adjustment | (74,767 | ) | 8,135 | (17,024 | ) | (117,085 | ) | |||||||||
| Reclassified to net income from discontinued operations | - | (125,220 | ) | - | (125,220 | ) | ||||||||||
| Total comprehensive (loss) income | (1,115,092 | ) | 9,386,183 | (2,887,175 | ) | 8,875,065 | ||||||||||
| Less: Total comprehensive loss attributable to non-controlling interests | (491 | ) | - | (491 | ) | - | ||||||||||
| Comprehensive (loss) income attributable to BAT Group, Inc. | $ | (1,114,601 | ) | $ | 9,386,183 | $ | (2,886,684 | ) | $ | 8,875,065 | ||||||
| Loss (income) per share - basic and diluted | $ | (0.14 | ) | $ | 2.14 | $ | (0.45 | ) | $ | 2.16 | ||||||
| Net loss per share from continuing operations – basic and diluted | $ | (0.14 | ) | $ | (0.09 | ) | $ | (0.45 | ) | $ | (0.23 | ) | ||||
| Net income per share from discontinued operations – basic and diluted | $ | - | $ | 2.23 | $ | - | $ | 2.39 | ||||||||
| Weighted Average Shares Outstanding-Basic and Diluted | 7,530,693 | 4,442,320 | 6,348,064 | 4,216,133 | ||||||||||||
BAT GROUP, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
| For the Six Months Ended June 30, | |||||||||
| 2019 | 2018 | ||||||||
| Cash Flows from Operating Activities: | |||||||||
| Net (loss) income | $ | (2,870,151 | ) | $ | 9,117,370 | ||||
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||||
| Depreciation of operating lease assets | 102,179 | 12,458 | |||||||
| Depreciation of property and equipment | 1,155 | 98 | |||||||
| Impairment on an operating lease asset | 96,318 | - | |||||||
| Restricted shares issued to service providers | 884,208 | - | |||||||
| Gain on disposal of discontinued operations | - | (9,794,873 | ) | ||||||
| Shares issued for settlement against legal proceedings | - | 943,860 | |||||||
| Changes in fair value of noncurrent liabilities | - | 166,540 | |||||||
| Changes in operating assets and liabilities: | |||||||||
| Other current assets | (72,394 | ) | (931,176 | ) | |||||
| Advances from customers | 33,497 | - | |||||||
| Due to a related party | 8,352 | - | |||||||
| Other current liabilities | 72,590 | (1,460 | ) | ||||||
| Other noncurrent liabilities | - | (1,311,000 | ) | ||||||
| Net cash provided by operating activities from discontinued operations | - | 1,769,566 | |||||||
| Net Cash Used in Operating Activities | (1,744,246 | ) | (28,617 | ) | |||||
| Cash Flows from Investing Activities: | |||||||||
| Purchases of property and equipment | (707 | ) | (5,376 | ) | |||||
| Purchases of operating lease assets | (1,902,529 | ) | (1,957,391 | ) | |||||
| Investment in one investment security | (200,000 | ) | |||||||
| Investments in equity investees | (884,225 | ) | - | ||||||
| Investments in financial products | (1,000,000 | ) | - | ||||||
| Loans to third parties | (1,114,225 | ) | - | ||||||
| Proceeds from disposal of discontinued operations | - | 500,000 | |||||||
| Cash in connection with discontinued operations | - | (499,496 | ) | ||||||
| Net cash used in investing activities from discontinued operations | - | (1,270,070 | ) | ||||||
| Net Cash Used in by Investing Activities | (5,101,686 | ) | (3,232,333 | ) | |||||
| Cash Flows from Financing Activities: | |||||||||
| Borrowings from third parties | 2,063,193 | - | |||||||
| Cash raised in registered direct offering, net of transaction costs | 4,653,440 | - | |||||||
| Cash raised in private placement of common stocks | - | 3,265,370 | |||||||
| Net Cash Provided by Financing Activities | 6,716,633 | 3,265,370 | |||||||
| Effect of Exchange Rate Changes on Cash | (47,631 | ) | (1,332 | ) | |||||
| Net (Decrease) Increase in Cash | (176,930 | ) | 3,088 | ||||||
| Cash at Beginning of Period | 1,484,116 | 1,359,630 | |||||||
| Cash at End of Period | $ | 1,307,186 | $ | 1,362,718 | |||||
| Non-cash financing activities | |||||||||
| Right-of-use assets obtained in exchange for operating lease obligations | $ | 64,241 | $ | - | |||||