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TIAN RUIXIANG Holdings Ltd Reports Financial Results for the Six Months Ended April 30, 2021

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BEIJING, Aug. 10, 2021 /PRNewswire/ -- TIAN RUIXIANG Holdings Ltd (Nasdaq: TIRX) (the "Company"), a China-based insurance broker, announced today its unaudited financial results for the six months ended April 30, 2021.

Mr. Zhe Wang, Chairman of the board of the directors and Chief Executive Officer of the Company, commented, "During the first half of the fiscal year 2021, we delivered significant growth as our revenue increased by 131.3% to $1.64 million, compared to the same period of the fiscal year 2020. Driven by positive results from our marketing activities and continuous economic recovery from the COVID-19 pandemic in China, we achieved our highest ever half year revenue. However, due to the increased professional fees related to the Company's initial public offering, our net loss increased by 71.4% to $0.40 million compared to the same period of the fiscal year 2020. Looking forward, we will continue to focus on customers' needs, expand our core service offerings, improve operational efficiency, and strive to achieve sustainable and high-quality growth to create significant value for our shareholders."

First Half of Fiscal Year 2021 Financial Highlights


For the Six Months Ended April 30,

($ in millions, except per share data)

2021


2020


% Change

Revenue

1.64


0.71


131.3%

Operating expenses

2.10


1.08


95.5%

Loss from operations

(0.46)


(0.37)


26.6%

Operating margin

(28.4)%


(52.0)%


23.6%

Net loss

(0.40)


(0.24)


71.4%

Loss per share

(0.06)


(0.05)


20.0%

  • Revenue increased by 131.3% to $1.64 million for the six months ended April 30, 2021, from $0.71 million for the same period of last year, primarily attributable to the growth of our business in China resulting from the increase in our marketing activities.

  • Operating expenses increased by 95.5% to $2.10 million for the six months ended April 30, 2021, from $1.08 million for the same period of last year.

  • Operating margin was (28.4)% for the six months ended April 30, 2021, compared to (52.0)% for the same period of last year.

  • Net loss was $0.40 million for the six months ended April 30, 2021, compared to $0.24 million for the same period of last year.

  • Loss per share was $0.06 for the six months ended April 30, 2021, compared to $0.05 for the same period of last year.

First Half of Fiscal Year 2021 Financial Results

Revenue

Revenue increased by $0.93 million, or 131.3%, to $1.64 million for the six months ended April 30, 2021, from $0.71 million for the same period of last year. This significant increase in revenue was primarily attributable to the growth of our business in China resulting from the increase in our marketing activities. We launched aggressive advertising campaigns to attract new customers.

Operating Expenses

Third party and related party selling and marketing expenses increased by $0.33 million, or 61.6%, to $0.86 million for the six months ended April 30, 2021, from $0.53 million for the same period of last year. The increase in selling and marketing expenses was mainly attributable to the increase in our marketing activities and the launch of aggressive advertising campaigns.

Third party and related party general and administrative expenses increased by $0.70 million, or 128.6%, to $1.24 million for the six months ended April 30, 2021, from $0.54 million for the same period of last year. The increase in general and administrative expenses was primarily attributable to the increased professional fees, compensation and related benefits and travel and entertainment expenses, and partially offset by the decreased rent and related utilities expenses.

Total operating expenses increased by $1.02 million, or 95.5%, to $2.10 million for the six months ended April 30, 2021 from $1.08 million for the same period of last year.

Loss from Operations

Loss from operations was $0.46 million for the six months ended April 30, 2021, compared to $0.37 million for the same period of last year.

The operating margin was (28.4)% for the six months ended April 30, 2021, compared to (52.0)% for the same period of last year.

Other Income (Expense)

Other income (expense) primarily includes interest income from notes receivable and bank deposits, and miscellaneous income. Other income, net, was $0.07 million for the six months ended April 30, 2021, compared to $0.14 million for the same period of last year.

Loss before Income Tax

Loss before income tax was $0.40 million for the six months ended April 30, 2021, compared to $0.23 million for the same period of last year.

Income tax expense was $6,917 for the six months ended April 30, 2021, compared to $4,631 for the same period of last year.

Net Loss and Loss per Share

Net loss was $0.40 million for the six months ended April 30, 2021, compared to $0.24 million for the same period of last year. After deduction of non-controlling interest, net loss attributable to TIRX ordinary shareholders was $0.40 million, or loss per share of $0.06 for the six months ended April 30, 2021, compared to $0.24 million, or loss per share of $0.05 for the same period of last year.

Financial Conditions

As of April 30, 2021, the Company had cash and cash equivalents of $18.16 million, compared to $6.14 million as of October 31, 2020. Total working capital was $18.10 million as of April 30, 2021, compared to $8.27 million as of October 31, 2020.

Net cash provided by operating activities was $1.09 million for the six months ended April 30, 2021, compared to net cash used in operating activities of $0.13 million for the same period of last year.

There were no investing activities for the six months ended April 30, 2021, net cash used in investing activities was $5,935 for the same period of last year.

Net cash provided by financing activities was $10.71 million for the six months ended April 30, 2021, compare to net cash used in financing activities of $0.34 million for the same period of last year.

About TIAN RUIXIANG Holdings Ltd

TIAN RUIXIANG Holdings Ltd, headquartered in Beijing, China, is an insurance broker operating in China. It distributes a wide range of insurance products, which are categorized into two major groups: (1) property and casualty insurance, such as automobile insurance, commercial property insurance, liability insurance; and (2) life insurance, such as individual and group life insurances. Additionally, the Company also provides risk management services to institutional customers. For more information, visit the company's website at http://ir.tianrx.com/.

Forward-Looking Statements

All statements other than statements of historical fact in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as "may," "will," "expect," "anticipate," "aim," "estimate," "intend," "plan," "believe," "potential," "continue," "is/are likely to" or other similar expressions. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review risk factors that may affect its future results in the Company's registration statement and in its other filings with the SEC.

For investor and media enquiries, please contact:

TIAN RUIXIANG Holdings Ltd
Investor Relations Department
Email: ir@tianrx.com

Ascent Investor Relations LLC
Tina Xiao
Phone: +1 917-609-0333
Email: tina.xiao@ascent-ir.com

TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(IN U.S. DOLLARS)







As of




April 30, 2021



October 31, 2020




(Unaudited)





ASSETS














CURRENT ASSETS:









Cash and cash equivalents


$

18,160,102



$

6,137,689


Restricted cash



810,279




785,806


Accounts receivable



359,268




1,247,059


Deferred offering costs



-




895,567


Prepaid expenses and other current assets



370,584




494,476











Total Current Assets



19,700,233




9,560,597











NON-CURRENT ASSETS:









Security deposit - noncurrent portion



7,813




7,419


Property and equipment, net



11,824




15,097


Intangible assets, net



155,791




160,219


Right-of-use assets, operating leases, net



268,992




317,141











Total Non-current Assets



444,420




499,876











Total Assets


$

20,144,653



$

10,060,473











LIABILITIES AND EQUITY


















CURRENT LIABILITIES:









Note payable


$

75,689



$

-


VAT and other taxes payable



525,120




548,630


Salary payable



353,139




129,711


Accrued liabilities and other payables



436,906




180,394


Due to related parties



46,547




241,097


Operating lease liabilities



144,485




170,082


Operating lease liabilities - related party



23,213




18,737











Total Current Liabilities



1,605,099




1,288,651











NON-CURRENT LIABILITIES:









Operating lease liabilities - noncurrent portion



91,547




123,404


Operating lease liabilities - related party - noncurrent portion



-




9,705











Total Non-current Liabilities



91,547




133,109











Total Liabilities



1,696,646




1,421,760











EQUITY:









TIAN RUIXIANG Holdings Ltd Shareholders' Equity:









Ordinary shares: $0.001 par value; 50,000,000 shares authorized;









Class A ordinary shares: $0.001 par value; 47,500,000 shares authorized;
6,825,000 and 3,750,000 shares issued and outstanding at April 30, 2021
and October 31, 2020, respectively



6,825




3,750


Class B ordinary shares: $0.001 par value; 2,500,000 shares
authorized; 1,250,000 shares issued and outstanding at April 30, 2021 and
October 31, 2020



1,250




1,250


Additional paid-in capital



17,609,386




7,696,468


Retained earnings



480,141




884,076


Statutory reserve



170,066




170,066


Accumulated other comprehensive income (loss) - foreign currency
translation adjustment



179,828




(117,392)


Total TIAN RUIXIANG Holdings Ltd shareholders' equity



18,447,496




8,638,218


Non-controlling interest



511




495











Total Equity



18,448,007




8,638,713











Total Liabilities and Equity


$

20,144,653



$

10,060,473


TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(IN U.S. DOLLARS)







For the Six Months Ended April 30,




2021



2020









REVENUES









Commissions


$

1,636,835



$

707,794











Total Revenues



1,636,835




707,794











OPERATING EXPENSES









Selling and marketing



858,448




518,734


Selling and marketing - related parties



940




13,038


General and administrative - professional fees



656,534




49,240


General and administrative - compensation and related benefits



424,225




355,710


General and administrative - related parties



10,139




4,716


General and administrative - other



152,044




134,141











Total Operating Expenses



2,102,330




1,075,579











LOSS FROM OPERATIONS



(465,495)




(367,785)











OTHER INCOME (EXPENSE)









Interest income



1,038




87,886


Interest income - related party



-




6,390


Other income



67,438




42,431











Total Other Income, net



68,476




136,707











LOSS BEFORE INCOME TAXES



(397,019)




(231,078)











INCOME TAXES



6,917




4,631











NET LOSS


$

(403,936)



$

(235,709)











LESS: NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST



(1)




(2)











NET LOSS ATTRIBUTABLE TO TIAN RUIXIANG HOLDINGS LTD
ORDINARY SHAREHOLDERS


$

(403,935)



$

(235,707)











COMPREHENSIVE LOSS:









NET LOSS



(403,936)




(235,709)


OTHER COMPREHENSIVE INCOME (LOSS)









Unrealized foreign currency translation gain (loss)



297,237




(23,551)


COMPREHENSIVE LOSS


$

(106,699)



$

(259,260)


LESS: COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO NON-
CONTROLLING INTEREST



16




(4)


COMPREHENSIVE LOSS ATTRIBUTABLE TO TIAN RUIXIANG
HOLDINGS LTD ORDINARY SHAREHOLDERS


$

(106,715)



$

(259,256)











NET LOSS PER ORDINARY SHARE ATTRIBUTABLE TO TIAN RUIXIANG
HOLDINGS LTD ORDINARY SHAREHOLDERS:









Basic and diluted


$

(0.06)



$

(0.05)











WEIGHTED AVERAGE ORDINARY SHARES OUTSTANDING:









Basic and diluted



6,560,497




5,000,000


TIAN RUIXIANG HOLDINGS LTD AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN U.S. DOLLARS)










For the Six Months Ended April 30,




2021



2020









CASH FLOWS FROM OPERATING ACTIVITIES:









Net loss


$

(403,936)



$

(235,709)


Adjustments to reconcile net loss to net cash provided by (used in) operating
activities:









Depreciation expense and amortization of intangible assets



13,492




13,679


Amortization of right-of-use assets



132,622




-


Changes in operating assets and liabilities:









Accounts receivable



923,218




(92,021)


Security deposit



4,495




1,626


Prepaid expenses and other current assets



134,880




32,093


Due from related parties



-




(15,245)


VAT and other taxes payable



(41,633)




(4,307)


Salary payable



218,031




76,746


Accrued liabilities and other payables



250,097




10,923


Due to related parties



10,071




57,711


Operating lease liabilities - related party



(6,141)




25,331


Operating lease liabilities



(141,073)




-











NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES



1,094,123




(129,173)











CASH FLOWS FROM INVESTING ACTIVITIES:









Purchase of property and equipment



-




(5,935)











NET CASH USED IN INVESTING ACTIVITIES



-




(5,935)











CASH FLOWS FROM FINANCING ACTIVITIES









Proceeds received from note payable



75,165




-


Proceeds received from related parties' borrowings



1,652,137




-


Repayments made for related parties' borrowings



(1,863,143)




-


Proceeds received from equity offering



12,300,000




5,000


Disbursements for equity offering costs



(1,449,770)




(349,345)











NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES



10,714,389




(344,345)











EFFECT OF EXCHANGE RATE ON CASH, CASH EQUIVALENTS AND
RESTRICTED CASH



238,374




(19,561)











NET INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND
RESTRICTED CASH



12,046,886




(499,014)











CASH, CASH EQUIVALENTS AND RESTRICTED CASH - beginning of period



6,923,495




6,966,586











CASH, CASH EQUIVALENTS AND RESTRICTED CASH - end of period


$

18,970,381



$

6,467,572











SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:









Cash paid for:









Interest


$

-



$

-


Income taxes


$

597



$

-











NON-CASH INVESTING AND FINANCING ACTIVITIES









Payments made by related parties on the Company's behalf


$

267,610



$

-











RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED
CASH









Cash and cash equivalents at beginning of period


$

6,137,689



$

6,243,029


Restricted cash at beginning of period



785,806




723,557


Total cash, cash equivalents and restricted cash at beginning of period


$

6,923,495



$

6,966,586











Cash and cash equivalents at end of period


$

18,160,102



$

5,743,827


Restricted cash at end of period



810,279




723,745


Total cash, cash equivalents and restricted cash at end of period


$

18,970,381



$

6,467,572


Cision
Cision

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SOURCE TIAN RUIXIANG Holdings Ltd