H/Cell Energy Reports FY2020 First Quarter Financial Results

Jersey City, New Jersey, UNITED STATES

DALLAS, May 15, 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 first quarter ended March 31, 2020.

For the three months ended March 31, 2020, HCCC generated revenue of $1,667,947 and a net loss of $261,761 which includes $68,701 of non-cash charges that do not affect the cash flow performance or working capital of HCCC. This amounts to a $(0.04) per share loss. Comparatively, for the first quarter ended March 31, 2019, HCCC generated revenue of $1,704,273 and a net loss of $143,638 which included $111,153 of non-cash charges. This amounted to a $(0.02) per share loss.

Andrew Hidalgo, CEO of HCCC, commented, "As with almost all businesses, the first quarter revenue production slowed down due to the coronavirus pandemic. Even with a slowdown, HCCC was able to generate $1,667,947 in first quarter revenue. Although we concluded a number of projects in the first quarter and we have not had any backlog canceled as of yet, there has been a postponement of some projects due to the economic uncertainty. Our domestic subsidiary was affected greater than our Australian subsidiary in the first quarter as COVID-19 has impacted the Mid-Atlantic region of the U.S. in larger proportion. We are all hoping that the economy will soon recover from the setbacks due to the pandemic.”

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 Australian subsidiary, HCCC also provides 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. No information in this press release should be construed as any indication of the Company’s future revenues, results of operations, or stock price. The information set forth herein speaks only as of the date hereof.


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

  March 31, 2020 December 31, 2019
Current assets    
Cash and cash equivalents $174,419  $277,620 
Accounts receivable  909,139   803,659 
Prepaid expenses  17,247   15,258 
Costs and earnings in excess of billings  29,850   26,045 
Total current assets   1,130,655   1,122,582 
Property and equipment, net  438,776   478,238 
Security deposits and other non-current assets  28,082   32,233 
Deferred tax asset  46,000   46,000 
Customer lists, net  58,040   63,161 
Right of use asset  249,638   222,524 
Deferred offering cost  129,180   130,072 
Goodwill  1,373,621   1,373,621 
Total assets  $3,453,992  $3,468,431 
Current liabilities    
Accounts payable and accrued expenses $935,258  $702,133 
Billings in excess of costs and earnings  37,930   47,098 
Sales and withholding tax payable  76,014   39,751 
Current operating lease liability  55,795   87,897 
Current equipment notes payable  25,187   27,435 
Current line of credit  165,960   269,746 
Current finance lease payable  76,240   75,743 
Current convertible note payable  135,938   80,500 
Current convertible notes payable – related party, net of discounts  459,116   - 
Income tax payable  30,649   41,426 
Total current liabilities   1,998,087   1,371,729 
Noncurrent liabilities    
Earn-out payable  214,074   209,199 
Lease operating liability  196,691   137,071 
Finance leases  293,535   307,804 
Equipment notes payable  61,968   121,038 
Convertible notes payable – related party, net of discounts  -   473,770 
Total noncurrent liabilities  766,268   1,199,984 
Total liabilities  2,764,355   2,571,713 
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; 7,788,524 and 7,725,524 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively  778   772 
Additional paid-in capital  3,037,460   2,969,686 
Accumulated deficit  (2,271,918)  (2,010,157)
Accumulated other comprehensive loss  (76,683)  (63,583)
Total stockholders' equity   689,637   896,718 

  For the Three Months Ended March 31,
  2020 2019
Sales $1,667,947  $1,704,273 
Total revenue   1,667,947   1,704,273 
Cost of goods sold     
Direct costs  1,318,515   1,196,438 
Total cost of goods sold   1,318,515   1,196,438 
Gross profit   349,432   507,835 
Operating expenses     
General and administrative expenses  527,054   607,052 
Management fees – related party  20,000   19,500 
Total operating expenses   547,054   626,552 
Loss from operations  (197,622)  (118,717)
Other expenses    
Interest expense  19,468   1,833 
Interest expense – related party  39,796   36,095 
Change in fair value earn-out  4,875   4,396 
(Gain) loss on fixed asset disposal  -   (17,403)
Total other expenses  64,139   24,921 
Income tax provision     - 
Net loss  $(261,761) $(143,638)
Other comprehensive income (loss), net     
Foreign currency translation adjustment  (13,100)  18,612 
Comprehensive loss  $(274,861) $(125,026)
Loss per share     
Basic $(0.04) $(0.02)
Diluted $(0.04) $(0.02)
Weighted average common shares outstanding     
Basic  7,743,005   7,593,413 
Diluted  7,743,005   7,593,413