UTime Ltd 6-K, filed Mar 30, 2022
UTime Ltd (FXHO)
About this 6-K
UTime Ltd filed this 6-K on March 30, 2022.
UNITED STATES
SECURITIES AND EXCHANGECOMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATEISSUER PURSUANT TO RULE 13A-16 OR 15D-16OF THE SECURITIES EXCHANGE ACT OF 1934
For the six months ended September 30, 2021
Commission File Number 001-40306
| UTIME LIMITED |
|---|
| (Translation of registrant’s name into English) |
| 7th Floor, Building 5A<br><br> <br>Shenzhen SoftwareIndustry Base, Nanshan DistrictShenzhen, People’s Republic of China 518061 |
| --- |
| (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.
INFORMATION CONTAINED IN THIS FORM 6-K REPORT
Attached as Exhibit 99.1 to this report are a press release of the Company, dated March 30, 2022, regarding the Company’s financial results for the six months ended September 30, 2021 and the unaudited consolidated financial statements of UTime Limited (the “Company”) as of September 30, 2021 and for the six months ended September 30, 2021 and 2020.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKINGSTATEMENTS
This report on Form 6-K and the exhibits hereto contain “forward-looking statements” for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that represent our beliefs, projections and predictions about future events. All statements other than statements of historical fact are “forward-looking statements,” including any projections of earnings, revenue or other financial items, any statements of the plans, strategies and objectives of management for future operations, any statements concerning proposed new projects or other developments, any statements regarding future economic conditions or performance, any statements of management’s beliefs, goals, strategies, intentions and objectives, and any statements of assumptions underlying any of the foregoing. Words such as “may”, “will”, “should”, “could”, “would”, “predicts”, “potential”, “continue”, “expects”, “anticipates”, “future”, “intends”, “plans”, “believes”, “estimates” and similar expressions, as well as statements in the future tense, identify forward-looking statements.
These statements are necessarily subjective and involve known and unknown risks, uncertainties and other important factors that could cause our actual results, performance or achievements, or industry results, to differ materially from any future results, performance or achievements described in or implied by such statements. Actual results may differ materially from expected results described in our forward-looking statements, including with respect to correct measurement and identification of factors affecting our business or the extent of their likely impact, and the accuracy and completeness of the publicly available information with respect to the factors upon which our business strategy is based or the success of our business.
Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of whether, or the times by which, our performance or results may be achieved. Forward-looking statements are based on information available at the time those statements are made and management’s belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to, those factors discussed more fully under the headings “Item 3. Key Information—3.D. Risk Factors” and elsewhere in our Form 20-F filed with the Securities and Exchange Commission (“SEC”) on July 22, 2021, in this report on Form 6-K and the exhibits hereto.
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EXHIBIT INDEX
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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.
| UTIME LIMITED | ||
|---|---|---|
| (Registrant) | ||
| Date: March 30, 2022 | By: | /s/ Minfei Bao |
| Minfei Bao | ||
| Chief Executive<br>Officer and<br><br>Chairman of the Board of Directors |
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Exhibit 99.1
UTimeAnnounces Financial Results for The First Six Months
ofFiscal Year 2022
Shenzhen, China, March 30, 2022/PRNewswire/ -- UTime Limited (“UTime” or the “Company”) (Nasdaq: UTME), a mobile device manufacturing company committed to providing cost effective products and solutions to consumers globally and helping low-income individuals from established and emerging markets, have better access to updated mobile technology, today announced its financial results for the first six months of fiscal year 2022 ended September 30, 2021.
FirstSix Months of Fiscal Year 2022 Financial and Operational Highlights
Allfinancial figures are in US Dollars unless otherwise noted.
| ● | Revenue<br>from Original Equipment Manufacturer (“OEM”) and Original Design Manufacturer (“ODM”) services decreased from<br>RMB129.0 million to RMB100.2 million (US$15.4 million), a 22% decrease mainly due to the decrease in sales of feature phones and smart<br>phones. |
|---|---|
| ● | Rapid<br> growth in Africa, especially established OEM/ODM clients. Revenue contribution increased from 4% to 13.5%. |
| --- | --- |
| ● | Gross<br> profit margin decreased from 12.8% to 8.2% primarily due to significant increase in raw material prices, especially in integrated<br> circuit (“IC”) and screens. |
| --- | --- |
| ● | Net<br> loss reached RMB9.3 million (US$1.4 million), compared to net income of RMB 7.0 million during the same period last year. Decrease<br> mainly due to the drop of OEM/ODM sales in China and non-recurring orders of face masks sales in the South America, and decrease<br> of in-house brand product in India. |
| --- | --- |
| ● | Exchange<br> rate between RMB and US Dollar considerably affected the Company’s financial results, as more than 50% of our products were<br> sold to customers outside of mainland China, and the exchange rate between the Indian Rupee and US Dollar considerably affected financial<br> results relating to one of the Company’s primary subsidiaries, Do Mobile India Private Ltd., which operates in India. |
| --- | --- |
Minfei Bao, Chairman and Chief Executive Officer of the Company, noted that the tremendous cost increase of key components, especially in ICs and screens, had considerable impact to the Company. “We have had to choose our customer orders more carefully to reduce the risk of the increasing purchase price, which consumes our profit from future orders and even the existing orders.” Mr. Bao also pointed that the Company had made a few adjustments accordingly, including shortening payment cycles, switching focus to higher margin products such as smart phones and touch panels, rescheduling production plans to avoid inventory shortage and developing new markets like Africa to respond the situation.
FirstSix Months of Fiscal Year 2022 Financial Results
Revenue
Revenue for the six months ended September 30, 2021 was RMB101.1 million (US$15.6 million), a decrease of RMB78.2 million, or 43.6%, from RMB179.3 million for the same period of 2020. The decrease was primarily attributable to the decrease in OEM/ODM sales by RMB28.9 million and non-recurring sales of face masks by RMB45.6 million, as well as the decrease of in-house brand sales by RMB3.8 million.
Costof sales
Cost of sales for the six months ended September 30, 2021 was RMB92.7 million (US$14.3 million), a decrease of RMB63.4 million, or 40.6%, from RMB156.1 million for the same period of 2020. The decrease was in line with the decrease of revenue.
Gross profit for the six months ended September 30, 2021 was RMB8.3 million (US$1.3 million), representing a decrease of RMB14.9 million, or 64.2%, from the gross profit of RMB23.2 million for the same period of 2020 as a result of factors mentioned above.
Overall gross profit margin for the six months ended September 30, 2021 was 8.22%, or 4.71 percentage points lower, as compared to gross profit margin of 12.93% for the same period of 2020.
OperatingExpenses
Operating expenses increased by RMB1.2 million, or 7.7%, from RMB15.2 million for the six months ended September 30, 2020 to RMB16.3 million (US$2.5 million) for the six months ended September 30, 2021.
General and administrative expenses consist of salary and benefits to the Company’s accounting, human resources, design and executive office staff, rental expenses, property management and utilities, office supplies and other expenses. The increase of RMB 2.8 million was mainly due to the compensation for our independent directors since April 8, 2021 and R&D related expenses.
Selling expenses decreased by RMB0.2 million, or 10.5%, from RMB1.9 million for the six months ended September 30, 2020 to RMB1.7 million (US$0.3 million) for the six months ended September 30, 2021. Selling expenses consist of salary and benefits, business travel, shipping expenses, entertainment, market promotion and other expenses relating to the Company’s sales and marketing activities. The decrease of RMB0.2 million in selling expense was mainly due to decrease in cargo forwarding and warehousing expenses.
Other expenses (income), net for the six months ended September 30, 2021 was net income of RMB1.2 million (US$0.2 million), as compared to net expense of RMB0.2 million for the same period of 2020. The increase in income was mainly attributed to (i) decrease in exchange loss of U.S. Dollar against RMB, (ii) increase in government subsidy, partially offset by the changes in doubtful account provision.
IncomeBefore Tax
Income tax provision is RMB nil for the six months ended September 30, 2020 and 2021.
NetIncome(loss)
Net loss was RMB9.3 million (US$1.4 million) for the six months ended September 30, 2021 compared to net income of RMB7.0 million for the six months ended September 30, 2020.
Cashand Cash Equivalents
As of September 30, 2021, the Company had cash and cash equivalents of $10.7 million, compared with $1.4 million as of March 31, 2021.
CashFlow
Net cash used in operating activities was RMB19.6 million (US$3.0 million) for the six months ended September 30, 2021 as compared with RMB0.4 million for the same period of 2020.
Net cash used in investing activities for six months ended September 30, 2021 was RMB6.6 million (US$1.0 million) as compared to net cash used in investing activities of RMB nil (US$ nil) for the same period of 2020. Cash used in the six months ended September 30, 2021 were for payments of property and equipment of RMB5.9 million (US$0.9 million), and payments for intangible assets of RMB0.7 million (US$0.1 million).
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Net cash provided by financing activities for six months ended September 30, 2021 was RMB87.1 million (US$13.4 million) as compared to RMB0.6 million (US$0.1 million) for the same period of 2020. The cash inflow was mainly attributable to proceeds from issuance of ordinary shares through IPO, capital contributions and short-term and long-term borrowings.
Exchangerate
Our reporting currency is the Renminbi. This announcement also contains translations of certain foreign currency amounts into U.S. dollars for the convenience of the reader. Unless otherwise stated, all translations of Renminbi into U.S. dollars were made at RMB6.4854 to US$1.00 for the six months ended September 30, 2021, the exchange rates set forth in the central parity of RMB against the U.S. dollar by the People’s Bank of China on September 30, 2021.
SafeHarbor Statement
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of 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,” “confident” and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as UTime’s strategic and operational plans, contain forward-looking statements. UTime may also make written or oral forward-looking statements in its periodic reports to the United States Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s growth strategies;, the recognition of the Company’s brand; trends and competition in global OEM/ODM market; development and commercialization of new products, services and technologies; governmental policies and relevant regulatory environment relating to the Company’s industry and/or aspects of the business operations and general economic conditions in China and around the globe, the ongoing coronavirus pandemic and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in the Company’s filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and the Company undertakes no obligation to update any forward-looking statement, except as required under applicable law.
AboutUTime Limited
UTime Limited operates as a mobile device manufacturing company committed to providing cost effective products and solutions to consumers globally and helping low-income individuals from established and emerging markets have access to modern mobile technology. UTime Limited is mainly engaged in the design, development, production, sales and brand operation of mobile phones, accessories and related consumer electronics. UTime Limited values systematic management and organizes production with strict high-quality standards and production technologies. UTime Limited continuously endeavors to improve its overall manufacturing service level, to strengthen its cost control processes, and enhance its ability to respond rapidly to market dynamics for sustainable development in its Electronics Manufacturing Services segment.
For more information, please visit the Company website at http://www.utimeworld.com/.
For further information, please contact:
WonderfulSky Finance Group Limited.
Karen Kong/ Audrey Wang
Email: utime@wsfg.hk
UnitedTime Technology Co., Ltd.
Mengzhu Zhao
Tel: +86-755-86512181
E-mail: ir@utimemoblie.com
Source: UTime Limited
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UTIMELIMITED
UNAUDITEDCONDENSED CONSOLIDATED BALANCE SHEETS
(Amountsin thousands, except share data and per share data, or otherwise noted)
| As of September 30, | |||||||
|---|---|---|---|---|---|---|---|
| 2021 | |||||||
| RMB | |||||||
| Assets | |||||||
| Current Assets | |||||||
| Cash and cash equivalents | 8,977 | 69,568 | |||||
| Restricted cash | 500 | - | |||||
| Accounts receivable, net | 17,522 | 17,619 | |||||
| Prepaid expenses and other current assets, net | 65,114 | 78,344 | |||||
| Due from related parties | 6,990 | 554 | |||||
| Inventories | 31,726 | 69,662 | |||||
| Total current assets | 130,829 | 235,747 | |||||
| Non-Current assets | |||||||
| Property and equipment, net | 35,683 | 39,987 | |||||
| Operating lease right-of-use assets, net | 1,429 | 815 | |||||
| Intangible assets, net | 2,307 | 2,336 | |||||
| Equity method investment | - | - | |||||
| Other non-current assets | 3,333 | - | |||||
| Total non-current assets | 42,752 | 43,138 | |||||
| Total Assets | 173,581 | 278,885 | |||||
| Liabilities and Shareholders’ equity | |||||||
| Current liabilities | |||||||
| Accounts payable | 49,121 | 84,009 | |||||
| Short-term borrowings | 30,800 | 35,900 | |||||
| / Current portion of long-term borrowings | 5,580 | 450 | |||||
| Due to related parties | 1,365 | 4,346 | |||||
| Lease liability | 1,144 | 815 | |||||
| Other payables and accrued liabilities | 60,090 | 54,523 | |||||
| Income tax payables | 18 | 18 | |||||
| Total current liabilities | 148,118 | 180,061 | |||||
| Non-current liabilities | |||||||
| Long-term borrowings | - | 8,490 | |||||
| Lease liability - non-current | 285 | - | |||||
| Total non-current liabilities | 285 | 8,490 | |||||
| Total liabilities (including amounts of the consolidated VIEs without recourse to the Company of RMB146,430 and RMB182,084 as of March 31, 2021 and September 30, 2021, respectively) | 148,403 | 188,551 | |||||
| Commitments and contingencies | |||||||
| Shareholders’ equity | |||||||
| Preferred share, par value US0.0001; Authorized:10,000,000 shares; none issued and outstanding as at March 31, 2021 and September 30, 2021 | - | - | |||||
| Ordinary shares, par value US0.0001; Authorized:140,000,000 shares; Issued and outstanding: 4,517,793 shares as at March 31, 2021 and 8,267,793 shares as at September 30, 2021 | 4 | 5 | |||||
| Additional paid-in capital | 73,217 | 147,670 | |||||
| Accumulated deficit | (49,444 | ) | (58,786 | ) | ) | ||
| Accumulated other comprehensive income | 1,401 | 1,445 | |||||
| Total UTime Limited shareholders’ equity | 25,178 | 90,334 | |||||
| Non-controlling interests | - | - | |||||
| Total shareholders' equity | 25,178 | 90,334 | |||||
| Total liabilities and shareholders' equity | 173,581 | 278,885 |
All values are in US Dollars.
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UTIMELIMITED
UNAUDITEDCONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Amountsin thousands, except share data and per share data, or otherwise noted)
| Six months ended September 30, | |||||||
|---|---|---|---|---|---|---|---|
| 2020 | 2021 | ||||||
| RMB | RMB | ||||||
| Net sales | 179,287 | 101,057 | 15,582 | ||||
| Cost of sales | 156,101 | 92,749 | |||||
| Gross profit | 23,186 | 8,308 | |||||
| Operating expenses: | |||||||
| Selling expenses | 1,906 | 1,661 | |||||
| General and administrative expenses | 13,046 | 15,856 | |||||
| Other expenses (income), net | 207 | (1,188 | ) | ) | |||
| Total operating expenses | 15,159 | 16,329 | |||||
| Income (loss) from operations | 8,027 | (8,021 | ) | ) | |||
| Interest expenses | 1,069 | 1,321 | |||||
| Income (loss) before income taxes | 6,958 | (9,342 | ) | ) | |||
| Income tax expenses | - | - | |||||
| Net income (loss) | 6,958 | (9,342 | ) | ) | |||
| Less: Net income attributable to non-controlling interests | - | - | |||||
| Net income (loss) attributable to UTime Limited | 6,958 | (9,342 | ) | ) | |||
| Comprehensive income (loss) | |||||||
| Net income (loss) | 6,958 | (9,342 | ) | ) | |||
| Foreign currency translation adjustment | 1,023 | 44 | |||||
| Total comprehensive income (loss) | 7,981 | (9,298 | ) | ) | |||
| Less: Comprehensive income (loss) attributable to non-controlling interest | - | - | |||||
| Comprehensive income (loss) attributable to UTime Limited | 7,981 | (9,298 | ) | ) | |||
| Income (loss) per share attributable to UTime Limited | |||||||
| Basic and diluted | 1.54 | (1.14 | ) | ) | |||
| Weighted average ordinary shares outstanding | |||||||
| Basic and diluted | 4,517,793 | 8,164,771 |
All values are in US Dollars.
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UTIME LIMITED LIMITED
UNAUDITEDCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amountsin thousands or otherwise noted)
| Six months ended September 30, | ||||||||
|---|---|---|---|---|---|---|---|---|
| 2020 | 2021 | |||||||
| RMB | RMB | |||||||
| Cash flows from operating activities: | ||||||||
| Net income (loss) | 6,958 | (9,342 | ) | ) | ||||
| Adjustments to reconcile net income (loss) from operations to net cash used by operating activities | ||||||||
| Depreciation and amortization | 2,037 | 2,276 | ||||||
| Allowances for obsolete inventories, net | 1,631 | 632 | ||||||
| Provision for doubtful account, net | (1,200 | ) | (161 | ) | ) | |||
| Loss on equity method investment | 833 | - | ||||||
| Loss on disposal of property and equipment | - | 6 | ||||||
| Loss on disposal of intangible asset | - | 348 | ||||||
| Net changes in operating assets and liabilities: | ||||||||
| Accounts receivable | (39,268 | ) | (331 | ) | ) | |||
| Prepaid expenses and other current assets | (13,133 | ) | (943 | ) | ) | |||
| Inventories | (3,521 | ) | (38,601 | ) | ) | |||
| Accounts payable | 34,545 | 36,317 | ||||||
| Other payables and accrued liabilities | 10,616 | (9,781 | ) | ) | ||||
| Related parties | 545 | - | ||||||
| Deferred revenue | (400 | ) | - | |||||
| Net cash used in operating activities | (357 | ) | (19,580 | ) | ) | |||
| Investing activities: | ||||||||
| Payment for property and equipment | - | (5,856 | ) | ) | ||||
| Payment for intangible assets | - | (777 | ) | ) | ||||
| Net cash used in investing activities | - | (6,633 | ) | ) | ||||
| Financing activities: | ||||||||
| Proceeds from short-term borrowings | 16,800 | 15,500 | ||||||
| Loan received from a shareholder | 900 | 3,000 | ||||||
| Proceeds from long-term borrowings | - | 9,000 | ||||||
| Repayment of loan from a shareholder | (1,500 | ) | - | |||||
| Repayment of short-term borrowings | (15,000 | ) | (10,400 | ) | ) | |||
| Repayments of long-term borrowings | (600 | ) | (5,640 | ) | ) | |||
| Down payment of the subsequent financings after the IPO | - | (19,003 | ) | ) | ||||
| Contribution in a subsidiary by a shareholder | - | 6,429 | ||||||
| Proceeds from issuance of ordinary shares through initial public offering (“IPO”), net | - | 88,262 | ||||||
| Net cash provided by financing activities | 600 | 87,148 | ||||||
| Effect of exchange rate changes on cash and cash equivalent and restricted cash | (28 | ) | (844 | ) | ) | |||
| Net increase in cash and cash equivalent and restricted cash | 215 | 60,091 | ||||||
| Cash and cash equivalents and restricted cash at beginning of period | 1,054 | 9,477 | ||||||
| Cash and cash equivalents and restricted cash at end of period | 1,269 | 69,568 |
All values are in US Dollars.
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