Welcome!

News Feed Item

Recon Technology Reports Second Quarter 2013 Financial Results

Revenue Increases 49%, Net Profit Up 278%

BEIJING, Feb. 13, 2013 /PRNewswire-FirstCall/ -- Recon Technology, Ltd. (Nasdaq: RCON) ("Recon" or the "Company"), a Chinese non-state-owned oilfield services provider to oil and gas companies and their affiliates, today reported results for its second quarter of fiscal 2013 ended December 31, 2012.

Q2 FY2013 Highlights


For the Three Months Ended




December 31,




2011


2012


% Change

Revenues

 RMB30,844,229


 RMB45,980,600


49.07%

Net income attributable to ordinary shareholders

1,395,926


5,288,361


278.84%

Earnings per share

0.35


1.34


278.84%

  • Total revenues for the second quarter of FY2013 were approximately RMB46.0 million ($7.3 million), an increase of 49.1% from the same period of FY2012.
  • Net income attributable to ordinary shareholders for the second quarter of FY2013 was RMB5.3 million ($0.8 million), or RMB1.34 ($0.21) per diluted share. Net income attributable to ordinary shareholders for the same period of FY2012 was RMB1.4 million, or RMB0.35 ($0.06) per diluted share.

"Recon recorded both strong top-line and bottom-line growth in the second quarter of fiscal 2013. We are very pleased with our progress over the past several quarters and expect the trend to continue in 2013." said Mr. Yin Shenping, Chairman and CEO of Recon. "For the six-month period, our business benefited mainly from our recently developed fracturing service business. It also benefited from our integrated product-service strategies. To further strengthen our competitive advantage, protect our leading market position, and maintain our strong growth momentum, we will continue to expand our portfolio of products and services and focus our growth strategies on high growth, high-margin areas." 

Q2 FY2013 Financial Results

Total revenues for the second quarter of FY2013 increased by 49.1% to RMB46.0 million ($7.3 million) from RMB30.8 million for the same period in FY2012. Service revenues were particularly strong, increasing 476.5% year over year. The overall increase of service revenue consisted mainly of fracturing services and minor maintenance services. During FY2012, Recon BHD signed several fracturing service contracts with an aggregate contract value of RMB30 million with Sinopec Zhongyuan oilfield. As of December 31, 2012, we have completed most of the contracts and recognized corresponding revenues from the contracts. Our management intends to leverage our reputation and experience in the field to pursue new fracturing business contracts in the coming years.

Gross profit increased to RMB14.0 million ($2.2 million) for the second quarter of FY2013, up 53.8% from the same period of FY2012. Gross margin increased to 30.49% for the second quarter of FY2013 from 29.55% for the same period in FY2012. The improvement in overall gross margin was mainly due to service and software sales contributing to a higher portion of total revenues. Service and software sales historically carry higher gross margins than hardware sales.

Selling and distribution expenses increased by 14.1% from RMB1.4 million for the second quarter of FY2012 to RMB1.6 million ($0.3 million) for the second quarter of FY2013. This increase was primarily due to increased shipping charge and maintenance expenses. General and administrative expenses decreased by 32.3% from RMB3.2 million for the second quarter of FY2012 to RMB2.5 million ($0.4 million) for the same period of FY2013. Research and development expenses were RMB4.2 million ($0.7 million) for the second quarter of FY2013, up 72.5% from a year ago. Overall, operating expenses increased by 18.6% year over year to RMB8.3 million ($1.3 million) for the second quarter of FY2013.

Income from operations was RMB5.7 million ($0.9 million) for the second quarter of FY2013, compared to RMB2.1 million for the same period of FY2012. This increase in income from operations is mainly driven by top line growth as well as decrease in SG&A expenses as a percentage of total revenues.

Net income attributable to ordinary shareholders increased by 278.8% to RMB5.3 million ($0.8 million) for the second quarter of FY2013 from RMB1.4 million for the same period of FY2012. Diluted earnings per share was RMB1.34 ($0.21) for the second quarter of FY2013, compared to RMB0.35 ($0.06) for the same period of FY2012.

Adjusted EBITDA was RMB7.6 million ($1.2 million) for the second quarter of FY2013, up 249.9% compared to RMB2.2 million for the same period of FY2012.


For the Three Months Ended


December 31,

Reconciliation of Adjusted EBITDA

2011


2012


2012

 to Net Income (Loss)

RMB


RMB


USD







Net income (loss)

 RMB1,581,383


 RMB5,887,567


RMB932,153

Provision for income taxes

104,566


423,308


67,020

Interest expense

133,384


546,658


86,550

Stock compensation expense

261,483


452,348


71,618

Depreciation, amortization and accretion

77,434


242,778


38,438







Adjusted EBITDA

 RMB2,158,250


 RMB7,552,659


RMB1,195,779

As of December 31, 2012, cash and cash equivalents were RMB2.1 million ($0.3 million). Cash and cash equivalents consist of cash on hand, demand deposits and highly liquid short-term debt investments with stated maturities of no more than six months.

Year-to-Date FY2013 Financial Results

Total revenues for the six months ended December 31, 2012 increased by 53.8% to RMB55.0 million ($8.7 million) from RMB35.8 million for the same period of fiscal 2012, primarily driven by strong sales from fracturing service business.

Gross profit increased to RMB16.5 million ($2.6 million) for the six months ended December 31, 2012, up 42.0% from the same period of fiscal 2012. Gross margin decreased to 29.92% for the six months ended December 31, 2012 from 32.39% for the same period ended December 31, 2011. The decrease in gross margin was mainly related to furnace sales, which carry a lower margin than our other solutions.

Selling and distribution expenses increased by 28.2% from RMB2.3 million for the six months ended December 31, 2011 to RMB2.9 million ($0.5 million) for the same period in fiscal 2013. This increase was primarily due to increased shipping charge and maintenance expenses. General and administrative expenses decreased by 22.9% from RMB5.8 million for the six months ended December 31, 2011 to RMB4.5 million ($0.7 million) for the same period of fiscal 2013. Research and development expenses were RMB5.7 million ($0.9 million) for the six months ended December 31, 2012, up 23.1% from the same period of fiscal 2012. Overall, operating expenses were RMB13.1 million ($2.1 million) for the six months ended December 31, 2012, steady compared to same period of last year.

Income from operations was RMB3.3 million ($0.5 million) for the six months ended December 31, 2012, compared to a loss of RMB1.1 million for the same period ended December 31, 2011. This increase in income from operations can be attributed primarily to an increase in total revenues and decrease in operating expenses as a percentage of total revenues.

Net income attributable to ordinary shareholders increased by 246.5% to RMB2.9 million ($0.5 million) for the six months ended December 31, 2012, an improvement of RMB4.9 million compared to a loss of RMB2.0 million for the same period of fiscal 2012. Diluted earnings per share was RMB0.75 ($0.12) for the six months ended December 31, 2012, compared to diluted loss per share of RMB0.51 for the same period ended December 31, 2011.

Adjusted EBITDA was RMB6.1 million ($1.0 million) for the six months ended December 31, 2012, compared to a loss of RMB0.6 million for the same period of fiscal 2012, an improvement of 1,048.5%.


For the Six Months Ended


December 31,

Reconciliation of Adjusted EBITDA

2011


2012


2012

 to Net Income (Loss)

RMB


RMB


USD







Net income (loss)

 RMB-1,823,813


 RMB3,549,283


$561,942

Provision for income taxes

213,081


454,932


72,027

Interest expense

276,295


876,414


138,759

Stock compensation expense

524,847


907,153


143,626

Depreciation, amortization and accretion

166,157


315,157


49,897







Adjusted EBITDA

 RMB-643,433


 RMB6,102,939


$966,251

For the six months ended December 31, 2012, net cash provided by operating activities was RMB5.2 million ($0.8 million). This was an increase of RMB7.2 million ($1.1 million) compared to net cash used in operating activities of RMB2.0 million for the six months ended December 31, 2011.

Net cash used in financing activities amounted to RMB6.6 million ($1.0 million) for the six months ended December 31, 2012, compared to RMB0.2 million for the same period of fiscal 2012. During the fiscal 2013 six-month period, we paid back a prior RMB12 million ($1.9 million) commercial bank loan and received a RMB5 million ($0.8 million) loan from another bank, which was guaranteed by one of our shareholders.

Net cash used in investing activities was RMB0.4 million (approximately $0.1 million) for the six months ended December 31, 2012, an increase of RMB0.3 million from RMB0.1 million for the same period of fiscal 2012. The increase was related to the purchase a motor vehicle.

About Recon Technology, Ltd.

Recon Technology, Ltd. is a non-state-owned oil field service company in China. The company has been providing software, equipment and services designed to increase the efficiency and automation in oil and gas exploration, extraction, production and refinery for Chinese oil and gas fields for more than 10 years. More information may be found at http://www.recon.cn or e-mail: [email protected].

This news 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. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in reports filed by the company with the Securities and Exchange Commission.

All such forward-looking statements, whether written or oral, and whether made by or on behalf of the company, are expressly qualified by the cautionary statements and any other cautionary statements which may accompany the forward-looking statements. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.

Contact:      

At the Company:
Recon Technology, Ltd.
Tel: +86-10-8494-5799
Email: [email protected]
Web: http://www.recon.cn

Investor Relations:
Tina Xiao
Weitian Group LLC
Email: [email protected]
Web: http://www.weitian-ir.com

SOURCE Recon Technology, Ltd.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
Everyone knows that truly innovative companies learn as they go along, pushing boundaries in response to market changes and demands. What's more of a mystery is how to balance innovation on a fresh platform built from scratch with the legacy tech stack, product suite and customers that continue to serve as the business' foundation. In his General Session at 19th Cloud Expo, Michael Chambliss, Head of Engineering at ReadyTalk, discussed why and how ReadyTalk diverted from healthy revenue and mor...
The 20th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held June 6-8, 2017, at the Javits Center in New York City, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit your speaking proposal ...
In this strange new world where more and more power is drawn from business technology, companies are effectively straddling two paths on the road to innovation and transformation into digital enterprises. The first path is the heritage trail – with “legacy” technology forming the background. Here, extant technologies are transformed by core IT teams to provide more API-driven approaches. Legacy systems can restrict companies that are transitioning into digital enterprises. To truly become a lead...
You have great SaaS business app ideas. You want to turn your idea quickly into a functional and engaging proof of concept. You need to be able to modify it to meet customers' needs, and you need to deliver a complete and secure SaaS application. How could you achieve all the above and yet avoid unforeseen IT requirements that add unnecessary cost and complexity? You also want your app to be responsive in any device at any time. In his session at 19th Cloud Expo, Mark Allen, General Manager of...
The Internet of Things (IoT) promises to simplify and streamline our lives by automating routine tasks that distract us from our goals. This promise is based on the ubiquitous deployment of smart, connected devices that link everything from industrial control systems to automobiles to refrigerators. Unfortunately, comparatively few of the devices currently deployed have been developed with an eye toward security, and as the DDoS attacks of late October 2016 have demonstrated, this oversight can ...
"MathFreeOn.com is a line coding platform for engineers and scientists. When they want to solve an engineering problem and they have to use software - they have to pay a lot of money for licenses - but with MathFreeOn you don't have to pay a lot of money. Just go to our site and write the code and you can check the result right away," explained Simon Lee, CMO of MathFreeOn, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Cla...
In his session at 19th Cloud Expo, Claude Remillard, Principal Program Manager in Developer Division at Microsoft, contrasted how his team used config as code and immutable patterns for continuous delivery of microservices and apps to the cloud. He showed how the immutable patterns helps developers do away with most of the complexity of config as code-enabling scenarios such as rollback, zero downtime upgrades with far greater simplicity. He also demoed building immutable pipelines in the cloud ...
As data explodes in quantity, importance and from new sources, the need for managing and protecting data residing across physical, virtual, and cloud environments grow with it. Managing data includes protecting it, indexing and classifying it for true, long-term management, compliance and E-Discovery. Commvault can ensure this with a single pane of glass solution – whether in a private cloud, a Service Provider delivered public cloud or a hybrid cloud environment – across the heterogeneous enter...
Bert Loomis was a visionary. This general session will highlight how Bert Loomis and people like him inspire us to build great things with small inventions. In their general session at 19th Cloud Expo, Harold Hannon, Architect at IBM Bluemix, and Michael O'Neill, Strategic Business Development at Nvidia, discussed the accelerating pace of AI development and how IBM Cloud and NVIDIA are partnering to bring AI capabilities to "every day," on-demand. They also reviewed two "free infrastructure" pr...
In his session at Cloud Expo, Robert Cohen, an economist and senior fellow at the Economic Strategy Institute, provideed economic scenarios that describe how the rapid adoption of software-defined everything including cloud services, SDDC and open networking will change GDP, industry growth, productivity and jobs. This session also included a drill down for several industries such as finance, social media, cloud service providers and pharmaceuticals.
"Dice has been around for the last 20 years. We have been helping tech professionals find new jobs and career opportunities," explained Manish Dixit, VP of Product and Engineering at Dice, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
"ReadyTalk is an audio and web video conferencing provider. We've really come to embrace WebRTC as the platform for our future of technology," explained Dan Cunningham, CTO of ReadyTalk, in this SYS-CON.tv interview at WebRTC Summit at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Extracting business value from Internet of Things (IoT) data doesn’t happen overnight. There are several requirements that must be satisfied, including IoT device enablement, data analysis, real-time detection of complex events and automated orchestration of actions. Unfortunately, too many companies fall short in achieving their business goals by implementing incomplete solutions or not focusing on tangible use cases. In his general session at @ThingsExpo, Dave McCarthy, Director of Products...
Infrastructure is widely available, but who’s managing inbound/outbound traffic? Data is created, stored, and managed online – who is protecting it and how? In his session at 19th Cloud Expo, Jaeson Yoo, SVP of Business Development at Penta Security Systems Inc., discussed how to keep any and all infrastructure clean, safe, and efficient by monitoring and filtering all malicious HTTP/HTTPS traffic at the OSI Layer 7. Stop attacks and web intruders before they can enter your network.
@DevOpsSummit taking place June 6-8, 2017 at Javits Center, New York City, is co-located with the 20th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. @DevOpsSummit at Cloud Expo New York Call for Papers is now open.