Recon Technology, Ltd Reports Financial Results for the First Six Months of Fiscal Year 2023.

BEIJING: Recon Technology, Ltd (NASDAQ: RCON) ("Recon" or the "Company"), a China-based independent solutions integrator in the oilfield service and environmental protection, electric power and coal chemical industries, today announced its financial results for the first six months of fiscal year 2023.

First Six Months of Fiscal 2023 Financial Metrics:

Total revenue decreased by approximately RMB8.8 million ($1.3 million) or 16.3% to RMB45.6 million ($6.6 million) for the six months ended December 31, 2022 from RMB54.4 million for the same period in 2021.

Gross profit decreased by approximately RMB1.4 million ($0.20 million) or 9.5% to RMB13.1 million ($1.9 million) for the six months ended December 31, 2022, from RMB14.5 million for the same period in 2021.

Gross margin increased to 28.8% for the six months ended December 31, 2022 from 26.7% for the same period in 2021.

Research and development expenses decreased from RMB5.5 million ($0.9 million) for the six months ended December 31, 2021 to RMB5.1 million ($0.7 million) for the same period in 2022.

Net income decreased by RMB141.3 million ($20.5 million) to net loss of RMB29.9 million ($4.3 million) for the six months ended December 31, 2022 from net income of RMB111.4 million ($17.5 million) for the same period in 2021.

For the Six Months Ended

December 31,

2022

2021

Increase /(Decrease)

Percentage

Change

(in RMB millions, except

earnings per share; differences

due to rounding)

Revenue

RMB

45.6

RMB

54.4

RMB

(8.8)

(16.3)

%

Gross profit

13.1

14.5

(1.4)

(9.5)

%

Gross margin

28.8

%

26.7

%

2.1 %

/

Net income

(29.9)

111.4

(141.3)

(126.8)

%

Net earnings per share-

diluted

(0.88)

3.87

(4.75)

(122.7)

%

Management Commentary

Mr. Shenping Yin, Founder and CEO of Recon said: "Due to the COVID-19 pandemic restrictions in China in the second half of 2022, both our business activities and those of our customers were restricted by varying degrees. As a result, our revenue for the first six months ended December 31, 2022 decreased by 16.3% compared to the same period of year 2021. Although we maintained a stable gross profit margin, we experienced operating losses and net losses. As China achieved major and decisive strides in the COVID 19 prevention and control efforts in early 2023, we believe our business is back to a favorable direction as we actively pursue business opportunities."

"Currently, as more markets in China's energy industry are opening up to non-state-owned companies, we are exploring opportunities in such other markets. We believe that our experience and deep understanding of the energy industry, especially in the fields of oil and gas, will always be the foundation for the company's long-term growth. In...