Blue Hat Interactive (BHAT)

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NEWS
Blue Hat Announces Financial Results for the First Half of 2023, Highlighted by 5,657.93% Increase in Revenues to $46.30 million
XIAMEN, China, Dec. 22, 2023 (GLOBE NEWSWIRE) -- Blue Hat Interactive Entertainment Technology (“Blue Hat” or the “Company”) (NASDAQ: BHAT), primarily a company of commodity trading in China, today announced its unaudited financial results for the six months ended June 30, 2023 (“First Half of 2023”).

First Half of 2023 Financial Highlights

First Half of 2023 total revenues of US$46.30 million, compared to US$0.80 million in the prior-year period, due to that increased commodity trading.
First Half of 2023 gross profit of US$0.08 million, a decreased of 70.87% from US$0.26 million in the prior-year period. This is due to the lower gross profit margin of mass goods due to greater fluctuations in purchasing and selling prices.
First Half of 2023 loss from operations of US$4.07 million, an increase of 69.79% from loss from continuing operations of US$2.40 million in the prior-year period.
Net loss from continued operation increased 77.52% to US$4.36 million for the First Half of 2023, from US$2.46 million in the prior-year period.
Net income from discontinued operation is US$4,894 for the First Half of 2023, comparing with the net loss from discontinued operation of US$3.71 million in the prior-year period.
US$0.13 million in cash and cash equivalents as of June 30, 2023.
Management Commentary

The COVID-19 outbreak since early 2020 has had a negative impact on the global economy and our financial performance has been negatively impacted. Mr. Xiaodong Chen, CEO of Blue Hat, stated, “In order to cope with the current situation of the economy environment, some adjustments have been made to the Company’s business, and the Company has suspended the AR Immersive Course (ARIC), game and communication business, which were severely affected by the COVID-19 pandemic. The Company has been focusing on the commodity supply chain, commodity trading platform project and increasing the breadth of the Company’s business. At the same time, the Company has increased the investment and development in some new projects, which will provide more catalyst for the future development of the Company, to grow the Company steadily and maximize the value for the shareholders.”

Recent Operating Highlights

On March 31, 2023, Blue Hat closed a private placement of 4,000,000 ordinary shares, par value $0.01 per share (referred to hereinafter as the “ordinary shares”) at a price of $0.70 per share to one purchaser and its designated persons without a broker. The aggregate gross proceeds to the Company is approximately $2.80 million.
On May 23, 2023, the Company entered into a Consulting Service Agreement with Wei Deng (the “Consultant”). In consideration of the services to be provided by the Consultant to the Company for one year, the Company issued a total of 500,000 restricted shares of the Company ordinary shares at a price of $1.03 per share.
On June 8, 2023, Fujian Blue Hat Interactive Entertainment Technology Ltd., Fuzhou CSFCTECH Co. Ltd., Fujian Roar Game Technology Co. Ltd. and Fuzhou UC71 Co., Ltd. were deconsolidated from the Company as a result of the termination of the VIE agreements.
First Half of 2023 Results

Total revenues were US$46.30 million for the First Half of 2023, an increase of US$45.50 million, or 5,657.93%, compared to US$0.80 million in the prior-year period. It was due to the increase of commodity trading.

Revenues from sales of commodity trading were US$45.94 million for the First Half of 2023, compared to nil in the prior-year period.

Revenues from sales of information service were US$0.37 million for the First Half of 2023, compared to US$0.66 million in the prior-year period.

Revenues from sales of interactive toys (animation series) were nil for the for the First Half of 2023, compared to US$7,146 in the prior-year period.

Revenues from sales of interactive toys (game series) were nil for the First Half of 2023, compared to US$0.14 million in the prior-year period.

Gross profit decreased 70.87% to US$0.08 million for the First Half of 2023, from US$0.26 million in the prior-year period.

Total gross margin was 0.16% for the First Half of 2023, compared to 32.28% in the prior-year period.

Total operating expenses increased by US$1.49 million for the First Half of 2023, from US$2.65 million in the prior-year period, primarily as a result of increased bad debt expenses in the first half of 2023.

Loss from operations increased 69.79% to loss from operations of US$4.07 million for the First Half of 2023, from US$2.40 million in the prior-year period.

Net loss from continued operation increased 77.52% to net loss from continued operation of US$4.36 million for the First Half of 2023, from US$2.46 million in the prior-year period.

Net income (loss) from discontinued operation increased 100.13% to net income from discontinued operation of US$4,894 for the First Half of 2023, from net loss from discontinued operation of US$3.71 million in the prior-year period.

Basic loss per share from continued operation were US$0.36 for the First Half of 2023, compared to US$0.41 in the prior-year period.

Basic loss per share from discontinued operation were nil for the First Half of 2023, compared to US$0.46 in the prior-year period.

Balance Sheet Highlights

As of June 30, 2023, Blue Hat had cash and cash equivalents of US$0.13 million, working capital of US$4.86 million and total shareholders’ equity (excluding the non-controlling interest) of US$11.89 million, compared to cash and cash equivalents of US$0.07 million, working capital of US$4.12 million and total shareholders’ equity (excluding the non-controlling interest) of US$12.11 million, respectively, as of December 31, 2022.

During the First Half of 2023, the Company completed a private placement by issuing 4 million restrictive ordinary shares. Separate from the above transaction, the Company paid consulting services by issuing 0.5 million restrictive ordinary shares.

About Blue Hat

Blue Hat was formerly a provider of communication services and IDC business, as well as a producer, developer, and operator of AR interactive entertainment games, toys, and educational materials in China. Leveraging years of technological accumulation and unique patented technology, Blue Hat is expanding its business to commodity trading, aiming to become a leading intelligent commodity trader worldwide. For more information, please visit the Company’s investor relations website at http://ir.bluehatgroup.com. The Company routinely provides important information on its website.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. All forward-looking statements are inherently uncertain as they are based on current expectations and assumptions concerning future events or future performance of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. In evaluating such statements, prospective investors should review carefully various risks and uncertainties identified in this release and matters set in the Company’s SEC filings. These risks and uncertainties could cause the Company’s actual results to differ materially from those indicated in its forward-looking statements.

Contacts:

Blue Hat Interactive Entertainment Technology
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BLUE HAT INTERACTIVE ENTERTAINMENT TECHNOLOGY AND SUBSIDIARIES