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BEIJING, Sept. 28, 2022 (GLOBE NEWSWIRE) -- Datasea Inc. (NASDAQ: DTSS) (“Datasea” or the “Company”), incorporated in Nevada in September 2014, is a digital technology corporation engaged in three converging and innovative business segments: 5G messaging, acoustic intelligence, and smart city in China, today announced financial results for its full fiscal year ended June 30, 2022, and provided an update on its key strategic and operational initiatives. The Company will host a conference call and webcast to discuss its financial results today at 9 a.m. ET (9 p.m. Beijing and Hong Kong Time).
“This year marked an important moment in Datasea’s history. We launched 5G messaging solutions and introduced acoustic intelligence to the market, which combined with our original smart city offerings, broadened the ecosystem and expanded the total addressable market,” said Zhixin Liu, CEO of Datasea.
Mrs. Liu continued, “Our business revenue for the fiscal year ended June 30, 2022 continued to be strong at 9,653% compared to the fiscal year ended June 30, 2021, mainly driven by the 5G messaging business. The investments we have made in both technology and product rollouts in promising areas are enhancing our competitive positioning, and will also add new revenue resources, such as the acoustic intelligence business, in the new fiscal year. Our growth strategies are designed to fortify our position and build on our market share gains including our efforts around key product innovation, effective marketing and merchandising strategies, and productivity improvement.”
Full Year Financial Highlights
Full Year Business Highlights
5G Messaging
Acoustic Intelligence
Datasea is an acoustic intelligence trailblazer and aims to introduce this cutting-edge technology and its applications to China and the world. Company demonstrated the commercial potential of acoustic intelligence, through direct sales of acoustic intelligence powered disinfection equipment and agreements with different businesses to apply acoustic intelligence in the areas such as automotive systems and smart home appliances.
Smart City
Webcast and Conference Call Information
The Company will host a conference call and webcast to discuss its financial results today at 9 a.m. ET (9 p.m. Beijing and Hong Kong Time).
Dial-in details for the earnings conference call are as follows:
Toll Free: 1-877-451-6152
Toll/International: 1-201-389-0879
Participants should dial-in at least 5 minutes before the scheduled start time. Additionally, a live and archived webcast of the conference call will be available at: https://viavid.webcasts.com/starthere.jsp?ei=1573666&tp_key=436d1f4157
A replay of the conference call will be accessible approximately soon after the conclusion of the live, by dialing the following telephone numbers:
Toll Free: 1-844-512-2921
Toll/International: 1-412-317-6671
Replay Pin Number: 13733271
Replay Start: Wednesday September 28, 2022, 12:00 PM ET
Replay Expiry: Wednesday October 5, 2022, 11:59 PM ET
About Datasea Inc.
Datasea Inc., through its variable interest entity, Shuhai Information Technology Co., Ltd., a digital technology company in China, engages in three converging and innovative industries: smart city, acoustic intelligence and 5G messaging. Datasea leverages facial recognition technology and other visual intelligence algorithms, combined with cutting-edge acoustic and non-visual intelligence algorithms, to provide smart city solutions that meet the security needs of residential communities, schools and commercial enterprises. Most recently, in response to the growing utilization of 5G technologies and the overall initiative to utilize Datasea’s technology capabilities to expand business coverage and revenue resources, Datasea has also strategically expanded business coverage to 5G messaging and smart payment solutions. Datasea has been certified as one of the High-Tech Enterprises (jointly issued by the Beijing Science and Technology Commission, Beijing Finance Bureau, Beijing State Taxation Bureau and Beijing Local Taxation Bureau) and one of the Zhongguancun High Tech Enterprises (issued by the Zhongguancun Science Park Administrative Committee) in recognition of the company’s achievement in high technology products. For additional company information, please visit: www.dataseainc.com. Datasea routinely posts important information on its website.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will", "expects", "anticipates", "future", "intends", "plans", "believes", "estimates", "target", "going forward", "outlook," “objective” and similar terms. Such statements are based upon management's current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and which are beyond Datasea's control, which may cause Datasea's actual results, performance or achievements (including the RMB/USD value of its anticipated benefit to Datasea as described herein) to differ materially and in an adverse manner from anticipated results contained or implied in the forward-looking statements. Further information regarding these and other risks, uncertainties or factors is included in Datasea's filings with the U.S. Securities and Exchange Commission, which are available at www.sec.gov. Datasea does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under law.
Datasea investor and media Contact:
International Elite Capital Inc.
Annabelle Zhang
Telephone: +1(646) 866-7989
Email: datasea@iecapitalusa.com
DATASEA INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
| YEARS ENDED JUNE 30, | ||||||||
| 2022 | 2021 | |||||||
| Revenues | $ | 17,080,911 | $ | 175,138 | ||||
| Cost of goods sold | 16,125,238 | 81,135 | ||||||
| Gross profit | 955,673 | 94,003 | ||||||
| Operating expenses | ||||||||
| Selling | 1,358,203 | 568,034 | ||||||
| General and administrative | 5,574,985 | 3,535,416 | ||||||
| Research and development | 1,259,739 | 851,839 | ||||||
| Total operating expenses | 8,192,927 | 4,955,289 | ||||||
| Loss from operations | (7,237,254 | ) | (4,861,286 | ) | ||||
| Non-operating income (expenses) | ||||||||
| Other income (expenses) | 75,075 | (25,547 | ) | |||||
| Interest income | 50,497 | 2,517 | ||||||
| Total non-operating income (expenses), net | 125,572 | (23,030 | ) | |||||
| Loss before income tax | (7,111,682 | ) | (4,884,316 | ) | ||||
| Income tax | - | - | ||||||
| Loss before noncontrolling interest | (7,111,682 | ) | (4,884,316 | ) | ||||
| Less: loss attributable to noncontrolling interest | (589,974 | ) | (235,839 | ) | ||||
| Net loss to the Company | (6,521,708 | ) | (4,648,477 | ) | ||||
| Other comprehensive item | ||||||||
| Foreign currency translation gain attributable to the Company | 10,337 | 103,043 | ||||||
| Foreign currency translation loss attributable to noncontrolling interest | (22,356 | ) | (6,104 | ) | ||||
| Comprehensive loss attributable to the Company | $ | (6,511,371 | ) | $ | (4,545,434 | ) | ||
| Comprehensive loss attributable to noncontrolling interest | $ | (612,330 | ) | $ | (241,943 | ) | ||
| Basic and diluted net loss per share | $ | (0.27 | ) | $ | (0.22 | ) | ||
| Weighted average shares used for computing basic and diluted loss per share | 23,956,393 | 21,279,004 | ||||||
DATASEA INC.
CONSOLIDATED BALANCE SHEETS
| JUNE 30, 2022 | JUNE 30, 2021 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash | $ | 164,217 | $ | 49,676 | ||||
| Accounts receivable | 259,410 | 1,856 | ||||||
| Inventory | 211,353 | 194,264 | ||||||
| Value-added tax prepayment | 46,509 | 171,574 | ||||||
| Prepaid expenses and other current assets | 575,312 | 468,615 | ||||||
| Total current assets | 1,256,801 | 885,985 | ||||||
| NONCURRENT ASSETS | ||||||||
| Security deposit for rents | 17,181 | 256,987 | ||||||
| Long term investment | 29,800 | - | ||||||
| Property and equipment, net | 187,831 | 309,408 | ||||||
| Intangible assets, net | 1,741,791 | 1,092,147 | ||||||
| Right-of-use assets, net | 522,273 | 1,350,590 | ||||||
| Total noncurrent assets | 2,498,876 | 3,009,132 | ||||||
| TOTAL ASSETS | $ | 3,755,677 | $ | 3,895,117 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable | $ | 197,573 | $ | 174,718 | ||||
| Unearned revenue | 289,888 | 189,527 | ||||||
| Deferred revenue | - | 46,439 | ||||||
| Accrued expenses and other payables | 994,884 | 561,674 | ||||||
| Due to related party | 102,331 | 69,305 | ||||||
| Loans payable | 81,950 | 1,486,819 | ||||||
| Operating lease liabilities | 457,949 | 730,185 | ||||||
| Total current liabilities | 2,124,575 | 3,258,667 | ||||||
| NONCURRENT LIABILITIES | ||||||||
| Operating lease liabilities | 31,470 | 558,739 | ||||||
| Total noncurrent liabilities | 31,470 | 558,739 | ||||||
| TOTAL LIABILITIES | 2,156,045 | 3,817,406 | ||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| STOCKHOLDERS’ EQUITY | ||||||||
| Common stock, $0.001 par value, 375,000,000 shares authorized, 24,324,633 and 21,474,138 shares issued and outstanding as of June 30, 2022 and 2021, respectively | 24,325 | 21,474 | ||||||
| Additional paid-in capital | 20,729,559 | 12,086,788 | ||||||
| Accumulated comprehensive income | 283,587 | 273,250 | ||||||
| Accumulated deficit | (18,583,566 | ) | (12,061,858 | ) | ||||
| TOTAL COMPANY STOCKHOLDERS’ EQUITY | 2,453,905 | 319,654 | ||||||
| Noncontrolling interest | (854,273 | ) | (241,943 | ) | ||||
| TOTAL EQUITY | 1,599,632 | 77,711 | ||||||
| TOTAL LIABILITIES AND EQUITY | $ | 3,755,677 | $ | 3,895,117 | ||||
DATASEA INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
| YEARS ENDED JUNE 30, | ||||||||
| 2022 | 2021 | |||||||
| Cash flows from operating activities: | ||||||||
| Loss including noncontrolling interest | $ | (7,111,682 | ) | $ | (4,884,316 | ) | ||
| Adjustments to reconcile loss including noncontrolling interest to net cash used in operating activities: | ||||||||
| Loss on disposal on fixed assets | 916 | 9,698 | ||||||
| Depreciation and amortization | 577,822 | 199,232 | ||||||
| Bad debt expense | 284,958 | 277,639 | ||||||
| Inventory impairment | - | 10,837 | ||||||
| Operating lease expense | 863,691 | 809,630 | ||||||
| Stock compensation expense | 642,000 | 21,000 | ||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | (267,771 | ) | (613 | ) | ||||
| Inventory | (25,323 | ) | 33,169 | |||||
| Value-added tax prepayment | 123,313 | (92,709 | ) | |||||
| Prepaid expenses and other current assets | (224,285 | ) | (66,982 | ) | ||||
| Accounts payable | 26,236 | 122,641 | ||||||
| Unearned revenue | 111,689 | 165,462 | ||||||
| Deferred revenue | (46,461 | ) | 42,168 | |||||
| Accrued expenses and other payables | 741,328 | 222,808 | ||||||
| Payment on operating lease liabilities | (836,143 | ) | (818,013 | ) | ||||
| Net cash used in operating activities | (5,139,712 | ) | (3,948,349 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Acquisition of property and equipment | (51,340 | ) | (142,537 | ) | ||||
| Acquisition of intangible assets | (1,051,111 | ) | (26,148 | ) | ||||
| Long-term investment | (30,973 | ) | - | |||||
| Net cash used in investing activities | (1,133,424 | ) | (168,685 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Due to related parties | 37,042 | 68,541 | ||||||
| (Payment) proceeds of loans payable | (1,402,336 | ) | 1,449,306 | |||||
| Proceeds from capital contribution from a major shareholder | 62,802 | - | ||||||
| Net proceeds from issuance of common stock | 7,681,796 | 931,000 | ||||||
| Net cash provided by financing activities | 6,379,304 | 2,448,847 | ||||||
| Effect of exchange rate changes on cash | 8,373 | 51,927 | ||||||
| Net increase (decrease) in cash | 114,541 | (1,616,260 | ) | |||||
| Cash, beginning of year | 49,676 | 1,665,936 | ||||||
| Cash, end of year | $ | 164,217 | $ | 49,676 | ||||
| Supplemental disclosures of cash flow information: | ||||||||
| Cash paid for interest | $ | - | $ | - | ||||
| Cash paid for income tax | $ | - | $ | - | ||||
| Supplemental disclosures of non-cash investing and financing activities: | ||||||||
| Transfer of prepaid software development expenditure to intangible assets | $ | 50,000 | $ | 1,304,996 | ||||
| Right-of-use assets obtained in exchange for new operating lease liabilities | $ | - | $ | 1,100,000 | ||||
| Shares issued for accrued bonus to officers | $ | 259,023 | $ | - | ||||
IMPORTANT NOTICE TO USERS (summary only, please refer to the Form 10-K for full text of notice); All information is unaudited unless otherwise noted or accompanied by an audit opinion and is subject to the more comprehensive information contained in our SEC reports and filings. We do not endorse third-party information. All information speaks as of the last fiscal quarter or year for which we have filed a Form 10-K or 10-Q, or for historical information the date or period expressly indicated in or with such information. We undertake no duty to update the information. Forward-looking statements are subject to risks and uncertainties described in our Forms 10-Q and 10-K.