Longfin Corp. Reports First Quarter 2018 Financial
Post# of 301275
New York, May 21, 2018 (GLOBE NEWSWIRE) --
New York, May. 21, 2018 (GLOBE NEWSWIRE) -- Longfin Corp. (“Longfin” or the “Company”) (LFIN), a global FinTech company, today released its financial results of the first quarter ended March 31, 2018.
First Quarter 2018 Financial Results
Revenue
For the three months ended March 31, 2018, the Company reported revenue of $54 million. The Company’s revenue consists of the following:
- Physical Commodities
Revenue related to the sale of physical commodities to the Company’s customers was $53 million for the three months ended March 31, 2018.
- Technology
Technology revenue for the three months ended March 31, 2018 consists of $1.61 million and is comprised of fees paid by third parties for using our proprietary risk management and trading infrastructure technology.
- Other Revenue
Other revenue consists of incentive income received from exchanges that is recognized when earned.
Operating Expenses
Operating expenses for the three months ended March 31, 2018 primarily consists of $51 million of expenses directly related to the sale of physical commodities, $1.16 million of fees related to technology revenue, $1.56 million of amortization expense related to the intangible assets acquired with the Longfin Tradex acquisition, $0.7 million of depreciation and amortization related to the Company’s computer equipment, $2 million of other operations and administrative expenses including legal and professional fees, and $0.3 million of employee compensation and payroll taxes.
Other income, net
Other income, net, consists of nominal gains recorded from the Company’s foreign currency transactions.
Net Loss
Net loss attributable to common stockholders was approximately $7.4 million for the three months ended March 31, 2018. $ 5 million loss due to Hudson Bay Note A, OID portion.
Cash and Liquidity Position
As of March 31, 2018, the Company had $4.4 million in cash and $31 million in accounts receivable and total liabilities of $50.6 million. To date the Company has received $3.7 million in net proceeds ($5.0 million net of costs of $1.3 million) related to the Note Financing and will not be able to obtain additional monies through the Note Financing until the Company files a Registration Statement to register the common shares underlying the Notes and Warrant and such Registration Statement is declared effective by the Securities and Exchange Commission. The Company also contemplates raising money through Regulation D offering from the accredited investors.
LONGFIN CORP. AND SUBSIDIARIES
Condensed Consolidated Balance Sheet
(in thousands, except share data)
| As at March 31, 2018 $ | As at December 31, 2017 $ | |||||||
| (Audited) | ||||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | 4,447 | 2,189 | ||||||
| Accounts receivable | 31,066 | 36,805 | ||||||
| Due from related parties | 3,150 | 4,721 | ||||||
| Derivatives held for trading | 107 | |||||||
| Other current assets | 10,570 | 336 | ||||||
| Total current assets | 49,340 | 44,051 | ||||||
| Property, plant and equipment, net | 8,688 | 8,429 | ||||||
| Intangibles, net | 33,742 | 35,305 | ||||||
| Goodwill | 90,474 | 90,474 | ||||||
| Total assets | 182,244 | $ | 178,259 | |||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | 20,989 | $ | 21,987 | |||||
| Accrued expenses | 304 | 3,369 | ||||||
| Due to related parties | 5,957 | 5,843 | ||||||
| Derivatives held for trading | 13 | - | ||||||
| Income taxes | 326 | 305 | ||||||
| Other current liabilities | 4,102 | - | ||||||
| Unsecured Loans | 1,185 | |||||||
| Convertible notes payable | 10,096 | - | ||||||
| Non-current liabilities | ||||||||
| Secured Loan | 125 | |||||||
| Total current liabilities | 43,097 | 31,504 | ||||||
| Income taxes | 354 | 354 | ||||||
| Deferred taxes | 7,158 | 7,435 | ||||||
| Total liabilities | 50,609 | 39,293 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity | ||||||||
| Class A voting common stock, $0.00001 par value; 200,000,000 shares authorized; and 44,540,989 shares issued and outstanding as of March 31, 2018 and 100,000,000 shares authorized; and 46,540,989 shares issued and outstanding as of December 31, 2017 | 1 | 1 | ||||||
| Class B voting common stock, $0.00001 par value; 75,000,000 shares authorized; and 30,000,000 shares issued and outstanding as of March 31, 2018 and December 31, 2017 | - | - | ||||||
| Class C voting common stock, $0.00001 par value; 25,000,000 shares authorized; and no shares issued and outstanding as of March 31, 2018 and December 31, 2017 | - | - | ||||||
| Additional paid-in capital | 165,334 | 165,334 | ||||||
| Non-controlling interest | 107 | - | ||||||
| Accumulated other comprehensive income | (37 | ) | - | |||||
| Accumulated deficit | (33,770 | ) | (26,369 | ) | ||||
| Total equity attributable to parent | 131,635 | 138,966 | ||||||
| Total liabilities and stockholders’ equity | 182,244 | $ | 178,259 | |||||
LONGFIN CORP. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(In thousands, except share and per share amounts)
| Three months ended March 31, 2018 $ | For the period from February 1, 2017 (inception) through March 31, 2017 $ | |||||||
| Revenue: | ||||||||
| Sale of physical commodities (includes sales to related parties of $10,669 in March 31, 2018 and Nil in March 31, 2017) | $ | 52,515 | - | |||||
| Technology revenue (includes sales to related parties of $398 in March 31, 2018 and Nil in March 31, 2017) | 1,613 | 702 | ||||||
| Other revenue | 131 | - | ||||||
| Total revenue | 54,259 | 702 | ||||||
| Operating expenses: | ||||||||
| Cost of physical commodities revenues (includes purchases from related parties of $27,029 in March 31, 2018 and Nil in March 31, 2017) | 51,048 | - | ||||||
| Cost of technology revenue (includes related party costs of Nil in March 31, 2018 and $638 in March 31, 2017) | 1,161 | 638 | ||||||
| Stock-based compensation | - | - | ||||||
| Employee compensation and payroll taxes | 274 | - | ||||||
| Operations and administrative | 2,003 | 42 | ||||||
| Depreciation and amortization | 693 | - | ||||||
| Amortization of acquired intangible assets | 1,563 | - | ||||||
| Total operating expenses | 56,742 | 680 | ||||||
| Profit /(Loss) from operations | (2,483 | ) | 22 | |||||
| Other income (expenses) | ||||||||
| Other income , net | (5,070 | ) | - | |||||
| Total other income, net | (5,070 | ) | - | |||||
| Profit/(Loss) before income taxes | (7,553 | ) | 22 | |||||
| Income tax (benefit) expense | (254 | ) | 3 | |||||
| Net profit/(loss) before minority interest | $ | (7,299 | ) | $ | 19 | |||
| Non-controlling interest in earnings of subsidiaries | 99 | - | ||||||
| Net profit/( loss) attributable to common stockholders | (7,398 | ) | 19 | |||||
| Net loss per common share, basic | $ | (0.10 | ) | $ | 0.003 | |||
| Net loss per common share, diluted | $ | (0.10 | ) | $ | 0.003 | |||
| Weighted average common shares outstanding, basic | 76,229,878 | 7,500,000 | ||||||
| Weighted average common shares outstanding, diluted | 76,229,878 | 7,500,000 | ||||||
LONGFIN CORP. AND SUBSIDIARIES
Condensed Consolidated Statements of Comprehensive Income / (Loss)
(in thousands)
| Three months ended March 31, 2018 | For the period from February 1, 2017 (inception) through March 31, 2017 | |||||||||||||||||||||||
| Longfin Corp. $ | Non- controlling Interest $ | Total $ | Longfin Corp. $ | Non- controlling Interest $ | Total $ | |||||||||||||||||||
| Net income / (loss) | (7,398 | ) | 99 | (7,299 | ) | - | - | - | ||||||||||||||||
| Foreign currency translation adjustments | (37 | ) | - | (37 | ) | - | - | - | ||||||||||||||||
| Comprehensive income (loss) | (7,361 | ) | 99 | (7,261 | ) | - | - | - | ||||||||||||||||
LONGFIN CORP. AND SUBSIDIARIES
Condensed Consolidated Statement of Cash Flows
(in thousands)
| Three months ended March 31, 2018 $ | For the period from February 1, 2017 (inception) through March 31, 2017 $ | |||||||
| Cash flows from operating activities | ||||||||
| Net loss | $ | (7,299 | ) | $ | 19 | |||
| Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | 2,256 | - | ||||||
| Other Comprehensive Income | (37 | ) | - | |||||
| Note issue expenses | 1,292 | - | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 5,739 | (702 | ) | |||||
| Due from related parties | 1,604 | - | ||||||
| Fair value (gain) / loss on trading securities | (94 | ) | - | |||||
| Other current assets | (10,267 | ) | - | |||||
| Accounts payable | (998 | ) | 638 | |||||
| Accrued expenses | (3,061 | ) | - | |||||
| Due to related parties | 110 | 26 | ||||||
| Income taxes | (256 | ) | 3 | |||||
| Other current liabilities | 9,199 | 17 | ||||||
| Net cash provided by operating activities | (1,812 | ) | - | |||||
| Cash flows from investing activities | ||||||||
| Purchase of computer software | (951 | ) | - | |||||
| Cash acquired by Longfin Limited (WI) acquisition | 3 | |||||||
| Net cash (used in) investing activities | (948 | ) | - | |||||
| Cash flows from financing activities | ||||||||
| Unsecured loan | 1,185 | - | ||||||
| Secured Loan | 125 | |||||||
| Proceeds from issuance of stock | - | - | ||||||
| Proceeds from issuance of convertible notes | 3,708 | - | ||||||
| Net cash provided by financing activities | 5,018 | - | ||||||
| Net increase in cash and cash equivalents | 2,258 | - | - | |||||
| Cash and cash equivalents at the beginning of the period | 2,189 | - | ||||||
| Cash and cash equivalents at the end of the period | $ | 4,447 | $ | - | ||||
Safe Harbor Statement
Certain information in this communicative statement contains “forward-looking statements” about the Company, as defined within the Private Securities Litigation Reform Act of 1995 or under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (collectively, “forward-looking statements”); these may not be based on historical fact, but instead relate to future events. Forward-looking statements are generally identified by words such as “projects,” “may,” “will,” “could,” “would,” “should,” “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “potential” or similar expressions. Such forward-looking statements include, without limitation, statements regarding new and existing services, technologies and opportunities, statements regarding market and industry segment growth and demand and acceptance of new and existing services, any projections of sales, earnings, revenue, margins or other financial items, any statements of the plans, strategies and objectives of management for future operations, any statements regarding future economic conditions, regulatory environment or performance, any statements of belief or intention, and any statements or assumptions underlying any of the foregoing. Risk factors and other material information concerning the Company are described in the Registration statement post qualification Offering Circular (Amendment No. 9) filed with the SEC on November 3, 2017 and other Company filings, including subsequent current and periodic reports, information statements and registration statements filed with the SEC. You are cautioned to review such reports and other filings at www.sec.gov. Given these risks, uncertainties and factors, you are cautioned not to place undue reliance on such forward-looking statements and information, which are qualified in their entirety by this cautionary statement. All forward-looking statements and information made herein are based on the Company’s current expectations and does not undertake an obligation to revise or update such forward-looking statements and information to reflect subsequent events or circumstances, except as required by law.
About Longfin Corp.
Longfin Corp (LFIN) is a US-based, global Fintech company powered by artificial intelligence (AI) and machine learning. The Company, through its wholly-owned subsidiary, Longfin Tradex Pte. Ltd, delivers FX and alternative finance solutions to importers/exporters and SME’s. Ziddu.com owned by the company is the only marketplace for smart contracts powered by Consensus Settlement Algorithm on Ethereum blockchain. Ziddu Ethereum ERC20 blockchain Token uses a technology stack in which Smart Contracts run in distributed virtual machines, which in turn run on a Consensus Settlement Algorithm (CSA) providing solutions to warehouse / international trade financing, micro-lending, FX OTC derivatives, bullion finance, and structured products. Currently, the company has operations in Singapore, Dubai, New York and India.
IR Contact:
Dragon Gate Investment Partners LLC
Tel: +1(646)-801-2803
Email: lfin@dgipl.com
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