CNENY(US:CNEY)2023-08-27 16:00Revenue and Profitability - Revenue for the six months ended March 31, 2023, was $22,675,117, representing a 66.1% increase from $13,650,703 in the same period of 2022[8] - The company reported a loss from operations of $(4,362,047) for the six months ended March 31, 2023, compared to a loss of $(388,612) in the prior year[8] - Net loss for the six months ended March 31, 2023, was $(4,171,178), compared to a net income of $1,000,786 in the same period of 2022[8] - For the six months ended March 31, 2023, the Company reported government subsidy income of $426,629, a decrease from $1,165,091 in the same period of 2022[55] Assets and Liabilities - Total current assets increased to $79,297,728 as of March 31, 2023, compared to $74,216,765 as of September 30, 2022, reflecting a growth of 6.4%[4] - Total assets rose significantly to $137,177,366, up 44.0% from $94,941,872 as of September 30, 2022[4] - Total liabilities decreased to $28,504,249 from $31,159,546, a reduction of 8.5%[6] - Shareholders' equity increased to $108,673,117 as of March 31, 2023, compared to $63,782,326 as of September 30, 2022, marking a growth of 70.5%[6] Cash Flow and Financing - Cash flows from operating activities showed a net cash used of $29,286,121 for the period ended March 31, 2023, compared to a net cash provided of $6,205,925 in the prior year[13] - Proceeds from the issuance of shares and warrants amounted to $7,820,433 for the period[13] - The total amount of unsecured short-term bank loans is $421,734, which includes loans from the Industrial and Commercial Bank of China[96] - The company has secured loans guaranteed by related parties, including Yefang Zhang, a principal shareholder, providing additional security for bank loans[100] Shareholder Information - The weighted average shares outstanding for basic earnings per share increased to 44,691,972 from 20,319,276 year-over-year[9] - CN Energy has an authorized unlimited number of no par value ordinary shares, with 10,000,000 shares issued and outstanding after a forward split[119] - As of March 31, 2023, there were 56,465,870 Class A ordinary shares and 3,020,969 Class B ordinary shares issued and outstanding[121] - In October 2022, CN Energy completed a private placement, issuing 10,514,018 Class A ordinary shares for a total of $18 million at a price of $1.712 per share[122] Research and Development - Research and development expenses increased to $589,090, up 69.5% from $347,464 in the same period of 2022[8] - Research and development expenses are fully expensed as incurred, reflecting the Company's commitment to innovation[55] Inventory and Receivables - Accounts receivable increased to $21,032,423 as of March 31, 2023, from $18,764,549 as of September 30, 2022, representing a growth of 6.76%[72] - Inventory totaled $3,343,904 as of March 31, 2023, up from $784,251 as of September 30, 2022, reflecting a significant increase in stock levels[72] - The allowance for doubtful accounts rose significantly to $2,262,274 as of March 31, 2023, compared to $330,990 as of September 30, 2022, indicating a substantial increase in credit risk provisions[73] Corporate Structure and Acquisitions - The company undertook a reorganization to simplify its corporate structure and enhance operational efficiency[19] - CN Energy completed the acquisition of MZ Mining International Co., Ltd for a total consideration of $17,706,575.88 and the issuance of 8,819,520 Class A ordinary shares valued at $18,373,771[22] - The acquisition of Yunnan Honghao was completed for a total consideration of $36,080,347, which included $18,373,771 in shares and $17,706,576 in cash[90] Tax and Compliance - The company expects to benefit from a reduced income tax rate of 15% as a High and New Technology Enterprise, which was renewed in December 2019[104] - The company has no material uncertain tax positions as of March 31, 2023, indicating a stable tax compliance environment[58] Operational Metrics - The company recognized a foreign currency translation gain of $1,208,367 during the period[11] - The exchange rate as of March 31, 2023, was US$1 for RMB6.8676, compared to US$1 for RMB7.1135 as of September 30, 2022[65] - The average remaining lease term was 1.4 years as of March 31, 2023, down from 1.9 years as of September 30, 2022[113]