Recon Technology, Ltd. (Nasdaq: RCON), a leading Chinese non-state-owned oil and gas automation services provider, today reported its financial results for its FY ’10 first quarter ended September 30, 2009.
Q1 FY ‘10 Highlights
- Revenue for Q1 FY ‘10 increased 119% to $3.3 million from $1.5 million in Q1 FY ‘09.
- Gross profit increased 337% to $937K for Q1 FY ‘10 from $214K in Q1 FY ‘09.
- Q1 FY ‘10 gross margin increased to 28% from 14% in Q1 FY ‘09.
- Income from operations was $190K compared to loss from operations of ($124K) in Q1 FY ‘09.
- Net income was $62K, compared to net loss of ($110K) in Q1 FY ‘09.
- Earnings per diluted share were $0.02 compared to a loss of ($0.05) per diluted share in Q1 FY ‘09.
- Weighted average number of diluted shares outstanding was 3.46 million as of September 30, 2009, compared to 2.25 million as of September 30, 2008.
- The company has filed its financial statements with financial notes as part of its 10-Q with SEC, which are available for public viewing at http://www.sec.gov.
Shenping Yin, Recon's Chief Executive Officer, said, "We are happy to report over triple digit growth in first quarter revenue and a positive bottom line compared with a net loss in the comparable quarter a year ago. Net income in what is traditionally our weakest quarter was in line with our internal forecasts. Our revenue is subject to high seasonality fluctuations due to our oil clients’ budgeting and planning schedules. Nevertheless, we continued to experience steady demand for our services that we expect will be positively reflected in our quarterly reports over the next three fiscal quarters.”
“There has been some discussion among shareholders about our mention in the last quarterly conference call of a possible future $30 million funding. I wish to clarify that we have no specific plans at this time for any sort of additional funding. That number surfaced in response to a theoretical question about potential acquisitions that would grow the company’s business. We believe there are some outstanding acquisition possibilities available to us. In the event that we have an opportunity to make a valuable acquisition that would immediately add value for our shareholders, it is conceivable that some sort of funding would be required. But there is nothing specifically planned at this point and, in any case, we have no intention of taking any action that would be inappropriately dilutive or harmful in any way to our shareholders.”
Shenping Yin concluded, "Based on stronger demand from our existing and new clients, we are raising our previous forecast for full fiscal year 2010 revenue to a range of $15 million to $16 million, a 40% to 45% increase over FY 2009 revenue, and net income to a range of $2.8 million to $2.9 million, a 25% to 30% increase over FY 2009 net income. We previously forecasted our revenue to be between $12.7 million and $13.3 million, net income between $2.5 million and $2.7 million.”
The above statements regarding forecast are forward-looking and actual results may differ materially. These are the company’s targets and not predictions of actual performance.
Recon CEO, Mr. Shenping Yin and CFO Ms. Jia Liu will host a conference call at 10:00 AM Eastern Time on Tuesday, November 17, 2009 (11:00 PM Beijing/Hong Kong Time on November 17) to review the company's financial results and respond to questions and comments.
To participate, call U.S. Toll Free Number 1-877-941-8602 approximately 10 minutes before the call. International callers, please dial 1-480-629-9811. The conference ID number is 4183979. An MP3 file will be available after the call for 90 days via http://www.hawkassociates.com.
About Recon Technology, Ltd.
Recon Technology, Ltd. has been providing leading Chinese oil and gas companies with automation services that increase efficiency and profitability in exploring, extracting, producing, processing, refining and transporting petroleum products for over 10 years. The company’s proprietary computerized process control system manages oil production in real-time to increase extraction levels, reduce impurities in extracted petroleum and lower production costs. In addition, as one of only two acoustic system providers in the world, Recon’s acoustic pipeline monitoring system is widely used to prevent gas leakage in the transport pipeline. Recon's technology is based on three software copyrights, eight product patents and four pending patents. Recon Technology is the first Chinese non-state-owned oil and gas service company to go public in the U.S. More information may be found at http://www.recon.cn or e-mail: firstname.lastname@example.org.
Recon's online investor kit, including an investment profile, press releases, current price quotes, stock charts and more is available at http://www.hawkassociates.com/profile/rcon.cfm. To receive notification of future releases via e-mail, subscribe at http://www.hawkassociates.com/about/alert/.
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.
Susan Zhou, 305-451-1888