6-K
Borqs Technologies, Inc. (BRQSF)
UNITEDSTATES
SECURITIESAND EXCHANGE COMMISSION
Washington,D.C. 20549
FORM6-K
REPORTOF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13A-16 OR 15D-16OF THE SECURITIES EXCHANGE ACT OF 1934
For the month of December 2020
Commission File Number 001-37593
BORQS TECHNOLOGIES, INC.
(Translation of registrant’s name into English)
Suite 309, 3/F Dongfeng KASO Dongfengbeiqiao, Chaoyang District Beijing 100016, China
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐.
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐.
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
INFORMATIONCONTAINED IN THIS FORM 6-K REPORT
As required by Nasdaq Rule 5250(c)(2), Borqs Technologies Inc. (the “Company”) hereby submits its interim balance sheet and income statement for its second quarter ended on June 30, 2020, and this submission is made within six months following the end of the said quarterly period. The consolidated financial statements contained herein are unaudited and prepared by management of the Company.
- 1 -
BORQSTECHNOLOGIES, INC.
UNAUDITEDCONSOLIDATED BALANCE SHEETS
(Amountsin thousands of US dollar (“US$”), unless otherwise stated)
| As<br> of June 30, | ||||
|---|---|---|---|---|
| 2019 | 2020 | |||
| US | US | |||
| ASSESTS | ||||
| Current assets: | ||||
| Cash and cash equivalents | ||||
| Accounts receivable | ||||
| Inventories - net | ||||
| Deferred cost of revenue | ||||
| Prepaid expenses and other current assets,<br> net | ||||
| Amounts due from discontinued operations | ||||
| Current assets held<br> for sale | ||||
| Total current assets | ||||
| Non-current assets: | ||||
| Property and equipment, net | ||||
| Intangible assets, net | ||||
| Right of Use Asset | ||||
| Deferred tax assets | ||||
| Deferred cost of revenues | ||||
| Other non-current assets | ||||
| Non-current assets<br> held for sale | ||||
| Total non-current assets | ||||
| Total assets | ||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||
| Current liabilities: | ||||
| Accounts payable | ||||
| Accrued expenses and other payables | ||||
| Advances from customers | ||||
| Lease Liabilities- current | ||||
| Amount due to related parties-current | ||||
| Deferred revenues | ||||
| Income tax payable | ||||
| Short-term institution and other borrowings | ||||
| Long-term institution borrowings - current<br> portion | ||||
| Current liabilities<br> held for sale | ||||
| Total current liabilities | ||||
| Non-current liabilities: | ||||
| Unrecognized tax benefits | ||||
| Deferred tax liability | ||||
| Deferred revenues | ||||
| Other non-current liabilities | ||||
| Long-term payable | ||||
| Deferred government grants | ||||
| Non-current liabilities<br> held for sale | ||||
| Total non-current liabilities | ||||
| Total liabilities | ||||
| Commitments and contingencies | ||||
| Shareholders’ equity | ||||
| Ordinary shares | ||||
| Additional paid-in capital | ||||
| Subscription receivables | ) | |||
| Statutory reserve | ||||
| Accumulated deficit | ) | ) | ||
| Accumulated other<br> comprehensive loss | ) | ) | ||
| Total Borqs Technologies, Inc. shareholders’<br> equity | ) | ) | ||
| Noncontrolling interest | ) | ) | ||
| Total shareholders’<br> equity | ) | ) | ||
| Total liabilities and shareholders’<br> equity |
All values are in US Dollars.
- 2 -
BORQSTECHNOLOGIES, INC.
UNAUDITEDCONSOLIDATED STATEMENT OF OPERATIONS
(Amountsin thousands of US$, unless otherwise stated)
| For the six months ended June 30, | ||||
|---|---|---|---|---|
| 2019 | 2020 | |||
| US | US | |||
| Net revenues: | ||||
| Software | ||||
| Hardware | ||||
| Total net revenues | ||||
| Cost of revenues | ||||
| Software | ) | ) | ||
| Hardware | ) | ) | ||
| Total cost of revenues | ) | ) | ||
| Total gross (loss) profit | ||||
| Operating expenses: | ||||
| Sales and marketing expenses | ) | ) | ||
| General and administrative expenses | ) | ) | ||
| Research and development expenses | ) | ) | ||
| Changes in the fair value of warrant liabilities | ||||
| Total operating expenses | ) | ) | ||
| Other operating income | ||||
| Operating income (loss) | ) | |||
| Interest income | ||||
| Interest expense | ) | ) | ||
| Other income | ||||
| Other expense | ) | ) | ||
| Foreign exchange income (loss) | ||||
| Income (loss) from continuing operations, before income taxes | ) | ) | ||
| Income tax expense | ) | |||
| Net income (loss) from continuing operations | ) | ) | ||
| Discontinued operation | ||||
| (Loss) income from operations of discontinued entities | ) | ) | ||
| Income tax benefit (expense) | ) | |||
| Net (Loss) income on discontinued operations | ) | ) | ||
| Net income (loss) | ) | ) | ||
| Less: Net income (loss) attributable to noncontrolling interest | ) | ) | ||
| Net income（loss）attributable to Borqs Technologies, Inc. | ) | ) |
All values are in US Dollars.
- 3 -
Summarydiscussions on the results of the first half of 2020.
Due to the pending sale of our MVNO Business Unit (the “MVNO BU”), intended to be completed approximately between October and December 2020, the historical unaudited interim financial statements presented above, for the periods ended June 30, 2020 and 2019, are prepared with the assets and liabilities of the MVNO BU classified as assets and liabilities held for sale and the activities of the MVNO BU as discontinued operations.
Our revenue for the six months ended June 30, 2020 was only $11.0 million as compared to $27.20 million for the same period of 2019. The increase in general and administrative expenses in the first half of 2020 was due to stock-based compensation that the Company incurred in lieu of cash payments; as the negative effects of the COVID-19 global pandemic directly impacted our business activities and hampered our working capital, when some of the factories and suppliers in China that we worked with were closed during this period of time.
Geographically, our sales were mainly from the U.S., India and Europe. Customers in the U.S. accounted for more than 60% of our sales in the first half of 2020 whereas in 2019 the bulk of our sales were generated from India.
- 4 -
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| BORQS TECHNOLOGIES INC. | ||
|---|---|---|
| (registrant) | ||
| Dated: December<br> 30, 2020 | By: | /s/<br> Anthony K. Chan |
| Anthony K. Chan | ||
| Chief Financial Officer |
- 5 -