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H/Cell Energy Reports FY2019 Year End Financial Results

/EIN News/ -- DALLAS, March 25, 2020 (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 fiscal year ended December 31, 2019.

Fiscal Year 2019 Highlights:

  • Both wholly-owned subsidiaries generated an operating profit for the year
  • HCCC generated $2.0 million in consolidated gross profit
  • HCCC entered into a $3 million equity line of credit for growth capital
  • HCCC successfully established a renewable energy division in Australia
  • HCCC obtained contract awards for $5.2 million in new projects in the last four months of 2019
  • HCCC increased its bid list to approximately $38 million

For the twelve months ended December 31, 2019, HCCC generated revenue of $6,817,324 and a net loss of $724,393, which includes $405,215 of non-cash charges that do not affect the cash flow performance or working capital of HCCC. This amounts to $(0.09) in loss per share. The results compare to revenue of $7,505,889 and a net loss of $554,010 or $(0.07) in loss per share, for the prior year ended December 31, 2018.

Andrew Hidalgo, CEO of HCCC, commented, "Fiscal year 2019 was a year of investment in the growth for our business. We established a renewable energy effort in Australia, which generated expense for labor, materials and training that took away from the core revenue production as compared to last year. However, we needed to establish a renewable energy footprint in Australia and by doing so, we believe that 2020 should see significant gains in renewable energy revenue production. We have already seen an increase in bids and projects awarded in renewable energy. With our $3 million equity line of credit, subject to market conditions, we have access to capital to continue the growth anticipated for 2020. Both of our subsidiaries are operationally profitable and we are managing our corporate expenses as effectively as possible. HCCC still maintains $3.5 million in assets and approximately $275,000 in cash as of December 31, 2019. Our bid activity remains high and we see 2020 as a year that will strengthen our balance sheet.”

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
CONSOLIDATED BALANCE SHEETS
         
    December 31, 2019   December 31, 2018
         
ASSETS        
Current assets        
Cash and cash equivalents   $ 277,620     $ 359,134  
Accounts receivable (net retention)     803,659       1,087,381  
Prepaid expenses     15,258       16,282  
Costs and earnings in excess of billings     26,045       45,478  
Total current assets     1,122,582       1,508,275  
         
Property and equipment, net     478,238       476,436  
Security deposits and other non-current assets     32,233       32,530  
Deferred tax asset     46,000       50,000  
Customer lists, net     63,161       83,645  
Right of use asset     222,524       -  
Deferred offering cost     130,072       -  
Goodwill     1,373,621       1,373,621  
         
Total assets   $ 3,468,431     $ 3,524,507  
         
LIABILITIES AND STOCKHOLDERS' EQUITY        
         
Current liabilities        
Accounts payable and accrued expenses   $ 702,133     $ 891,354  
Billings in excess of costs and earnings     47,098       195,331  
Sales and withholding tax payable     39,751       59,857  
Current operating lease liability     87,897       -  
Current equipment notes payable     27,435       38,991  
Current finance lease payable     75,743       65,265  
Current line of credit     269,746       -  
Current convertible note payable     80,500       -  
Income tax payable     41,426       48,643  
Total current liabilities     1,371,729       1,299,441  
         
Noncurrent liabilities        
Line of credit     -       28,359  
Lease operating liability     137,071       -  
Earn-out payable     209,199       190,736  
Equipment note payable     72,140       121,038  
Finance leases     307,804       232,876  
Convertible note payable – related party, net of discount     473,770       29,122  
Total noncurrent liabilities     1,199,984       602,131  
         
Total liabilities     2,571,713       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; 7,725,524 and 7,586,024 shares issued and outstanding as of December 31, 2019 and December 31, 2018, respectively     772       758  
Additional paid-in capital     2,969,686       2,983,476  
Accumulated deficit     (2,010,157 )     (1,285,764 )
Accumulated other comprehensive loss     (63,583 )     (75,535 )
Total stockholders' equity     896,718       1,622,935  
         
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY   $ 3,468,431     $ 3,524,507  
                 

H/CELL ENERGY CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS – OTHER COMPREHENSIVE INCOME

    For the Years Ended December 31,
      2019       2018  
         
Revenue        
Sales   $ 6,817,324     $ 7,505,889  
Related party     -       40,548  
Total revenue     6,817,324       7,546,437  
         
Cost of goods sold        
Direct costs     4,854,878       5,492,607  
Direct costs – related party     -       40,376  
Total cost of goods sold     4,854,878       5,532,983  
         
Gross profit     1,962,446       2,013,454  
         
Operating expenses        
General and administrative expenses     2,335,285       2,368,860  
Management fees – related party     80,500       78,000  
Total operating expenses     2,415,785       2,446,860  
         
Loss from operations     (453,339 )     (433,406 )
         
Other expenses (income)        
Interest expense     42,897       26,584  
Interest expense – related party     233,345       79,622  
Change in fair value earn-out     18,463       15,418  
Gain on fixed asset disposal     (36,651 )     (17,277 )
Total other expenses     258,054       104,347  
         
Net loss before taxes     (711,393 )     (537,753 )
         
Income tax provision     13,000       16,257  
         
Net loss   $ (724,393 )   $ (554,010 )
         
Other comprehensive income (loss), net        
         
Foreign currency translation adjustment     11,952       (46,725 )
         
Comprehensive loss   $ (712,441 )   $ (600,735 )
         
Loss per share        
Basic   $ (0.09 )   $ (0.07 )
Diluted   $ (0.09 )   $ (0.07 )
Weighted average common shares outstanding        
Basic     7,644,653       7,586,024  
Diluted     7,644,653       7,586,024  
                 

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