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CST: 22/08/2019 06:30:31   

H/Cell Energy Reports FY2019 Second Quarter Financial Results

14 Days ago

DALLAS, Aug. 07, 2019 (GLOBE NEWSWIRE) -- H/Cell Energy Corporation (OTCQB-HCCC) (“HCCC”), a company that designs and implements clean energy solutions featuring hydrogen and fuel cell technology, has announced financial results for its second quarter ended June 30, 2019.

For the three months ended June 30, 2019, HCCC generated revenue of $1,927,921 and a net loss of $105,223 which includes $75,980 of non-cash charges that do not affect the cash flow performance or working capital of HCCC. This amounts to a $(0.01) per share loss. For the six months ended June 30, 2019, HCCC generated revenue of $3,632,194 and a net loss of $248,861 which includes $187,133 of non-cash charges that again, do not affect the cash flow performance or working capital of HCCC. This amounts to a $(0.03) per share loss.

Andrew Hidalgo, CEO of HCCC, commented, "The second quarter was a very encouraging quarter for a number of reasons. Revenue production was up 12% from the previous quarter. Excluding non-cash charges that do not affect the cash flow performance or working capital of HCCC, the company only lost $29,243 on $1,927,921 of revenue for the three months ended June 30, 2019 and $61,728 on $3,632,194 of revenue for the six months ended June 30, 2019. That loss is attributed to corporate expenses as both our subsidiaries were operationally profitable. In the second quarter, we incurred most of our annual audit fees and along with the cost of concluding a financing transaction, corporate expenses were much higher than we initially projected. HCCC recently executed a $3 million equity financing line as previously reported. This was a significant milestone for HCCC and for the first time, gives us access to substantial growth capital going forward. With this new equity financing arrangement, we find ourselves in the best position yet to take HCCC to the next level. Our opportunities remain abundant. As of June 30, 2019, HCCC had over $40 million in bids of which close to $4 million is specific to renewable energy. The clean energy market is robust and we are in a unique position as an advanced clean energy integrator to take advantage of the opportunities to come. We look forward to successful quarters ahead.”

About H/Cell Energy Corporation:

H/Cell Energy Corporation is an integrator that focuses on the design and implementation of clean energy solutions including solar, battery, fuel cell and hydrogen generation systems. In addition, through its subsidiaries, HCCC also provides environmental systems and security systems integration. HCCC serves the residential, commercial and government sectors. Please visit our website at www.hcellenergy.com for more information.

Forward Looking Statements:

Certain statements in this press release are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of forward-looking words such as “anticipate,” “believe,” “forecast,” “estimate,” “expect,” and “intend,” among others. These forward-looking statements are based on current expectations and actual results could differ materially. H/Cell Energy Corporation does not undertake an obligation to update or revise any forward-looking statement. The information set forth herein speaks only as of the date hereof.

Contact:

H/Cell Energy Corporation
Investor Relations
3010 LBJ Freeway, Suite 1200
Dallas, Texas 75234
972-888-6009 USA

H/CELL ENERGY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS

  June 30, 2019   December 31, 2018
  (Unaudited)   (Audited)
ASSETS      
Current assets      
Cash and cash equivalents $ 313,530     $ 359,134  
Accounts receivable   1,191,224       1,087,381  
Prepaid expenses   15,163       16,282  
Current right-of-use (ROU) asset   86,018       -  
Costs and earnings in excess of billings   14,753       45,478  
Total current assets   1,620,688       1,508,275  
       
Property and equipment, net   455,044       476,436  
Security deposits and other non-current assets   32,505       32,530  
Deferred tax asset   50,000       50,000  
Customer lists, net   73,403       83,645  
ROU asset   154,378       -  
Other long term asset   30,000       -  
Goodwill   1,373,621       1,373,621  
       
Total assets $ 3,789,639     $ 3,524,507  
       
LIABILITIES AND STOCKHOLDERS' EQUITY      
       
Current liabilities      
Accounts payable and accrued expenses $ 869,668     $ 891,354  
Earn-out payable   199,679       190,736  
Billings in excess of costs and earnings   37,325       195,331  
Sales and withholding tax payable   66,489       59,857  
Current equipment notes payable   32,230       38,991  
Current operating lease liability   86,018       -  
Current finance lease payable   73,091       65,265  
Current convertible notes payable – related party, net of discounts   257,659       -  
Income tax payable   32,442       48,643  
 Total current liabilities   1,654,601       1,490,177  
       
Noncurrent liabilities      
Line of credit   230,415       28,359  
Lease operating liability   154,378       -  
Finance leases   284,431       232,876  
Equipment notes payable   57,083       121,038  
Convertible notes payable – related party, net of discounts   105,158       29,122  
Total noncurrent liabilities   831,465       411,395  
       
Total liabilities   2,486,066       1,901,572  
       
Commitments and contingencies       
       
Stockholders' equity      
Preferred stock - $0.0001 par value; 5,000,000 shares authorized; 0 shares issued and outstanding   -       -  
Common stock - $0.0001 par value; 25,000,000 shares authorized; 7,621,024 and 7,586,024 shares issued and outstanding as of June 30, 2019 and December 31, 2018, respectively   762       758  
Additional paid-in capital   2,898,598       2,983,476  
Accumulated deficit   (1,534,625 )     (1,285,764 )
Accumulated other comprehensive loss   (61,162 )     (75,535 )
Total stockholders' equity   1,303,573       1,622,935  
       
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $ 3,789,639     $ 3,524,507  
               

H/CELL ENERGY CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS – OTHER COMPREHENSIVE INCOME
(UNAUDITED)

  For the Three Months Ended June 30,   For the Six Months Ended June 30,
  2019   2018   2019   2018
               
Revenue              
Construction income $ 1,927,921     $ 2,009,825     $ 3,632,194     $ 3,704,360  
Related party   -       -       -       31,789  
Total revenue   1,927,921       2,009,825       3,632,194       3,736,149  
               
Cost of goods sold              
Direct costs   1,309,322       1,253,043       2,505,760       2,462,456  
Direct costs – related party   -       -       -       31,617  
Total cost of goods sold   1,309,322       1,253,043       2,505,760       2,494,073  
               
Gross profit   618,599       756,782       1,126,434       1,242,076  
               
Operating expenses              
General and administrative expenses   631,457       687,831       1,238,509       1,243,015  
Management fees – related party   19,500       19,500       39,000       39,000  
Total operating expenses   650,957       707,331       1,277,509       1,282,015  
               
Income  (loss) from operations   (32,358 )     49,451       (151,075 )     (39,939 )
               
Other expenses              
Interest expense   10,258       10,146       12,091       14,092  
Interest expense – related party   58,060       18,676       94,155       32,891  
Change in fair value earn-out   4,547       6,738       8,943       6,738  
(Gain) loss on fixed asset disposal   -       (64 )     (17,403 )     3,354  
Total other expenses   72,865       35,496       97,786       57,075  
               
Net income (loss) $ (105,223 )   $ 13,955     $ (248,861 )   $ (97,014 )
               
Other comprehensive income (loss), net              
               
Foreign currency translation adjustment   (4,239 )     (22,570 )     14,373       (32,829 )
               
Comprehensive loss $ (109,462 )   $ (8,615 )   $ (234,488 )   $ (129,843 )
               
Earnings (loss) per share              
Basic $ (0.01 )   $ 0.00     $ (0.03 )   $ (0.01 )
Diluted $ (0.01 )   $ 0.00     $ (0.03 )   $ (0.01 )
Weighted average common shares outstanding              
Basic   7,621,024       7,483,980       7,607,295       7,450,235  
Diluted   7,621,024       8,819,225       7,607,295       7,450,235  
               

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