HONG KONG, Nov. 5, 2021 /PRNewswire/ -- China Natural
Resources, Inc. (NASDAQ: CHNR) (the "Company") announced today
unaudited financial results for the six months ended June 30, 2021. The Company concurrently
reiterated its expansion and diversification strategy, under which
it is actively conducting due diligence as it explores compelling
business opportunities in the healthcare and other non-natural
resources sectors. As part of its strategy, the Company has already
completed a major investment in Shanghai Onway Environmental
Development Co., Ltd. ("Shanghai Onway"), which is principally
engaged in the provision of equipment for rural wastewater
treatment and provision of engineering, procurement, and
construction services in relation to wastewater treatment in
China (see "Subsequent Events"
below).
Mr. Wong Wah On Edward, Chairman
of the Company, commented, "Our financial results do not yet
reflect the work we have done – or plans we have underway – to
diversify our company and revenue base. It will take additional
time for our investments and strategy to drive consistent revenue
and profit growth, but we have made considerable strides and remain
very optimistic. We are confident that by diversifying into the
healthcare and other non-natural resources sectors we will be able
to gain a more sustainable, predictable business, one capable of
generating higher returns for investors."
Financial Results for the Six Months Ended June 30, 2021
As of June 30, 2021, the Company
had one operating segment: exploration and mining. Sales for
the six months ended June 30, 2021
were nil, as compared to total sales of approximately CNY6.87 million (US$1.06
million) for the same period in 2020, which were derived
from trading copper ore. The Company's subsidiary Bayannaoer Mining
ceased trading copper ore in the second half of 2020 due to the
volatile fluctuations of copper's price.
Net loss for the six months ended June
30, 2021 was approximately CNY26.74
million (US$4.14 million) as
compared with a profit of approximately CNY2.74 million (US$0.42
million) for the six months ended June 30, 2020. The loss was mainly due to the net
fair value loss of approximately CNY24.81
million (US$3.84 million)
relating to the Company's holdings in Feishang Anthracite Resources
Limited, a company listed on the Hong Kong Stock Exchange ("FARL"),
designated as financial assets at fair value through profit or
loss, and the impact of warrants issued to institutional investors
in a private placement on January 22,
2021, which were designated as derivative financial
liabilities.
The Company had an approximately CNY32.54
million (US$5.04 million)
balance of cash at June 30, 2021.
Net cash used in operating activities for the six months ended
June 30, 2021 was approximately
CNY5.40 million (US$0.84 million), an increase of approximately
CNY4.15 million (US$0.64 million) over the amount used in the six
months ended June 30, 2020 which was
mainly caused by higher professional service fees in 2021.
Net cash used in investing activities for the six months ended
June 30, 2021 was approximately
CNY0.26 million (US$0.04 million). The cash outflows from
investing activities in 2021 represent the disposal of a
subsidiary, Yangpu Lianzhong Mining Co., Limited, in 2021.
Net cash from financing activities for the six months ended
June 30, 2021 was approximately
CNY34.90 million (US$5.41 million). The cash inflows from financing
activities were primarily comprised of net cash proceeds from the
issuance of the Company's common shares and warrants to certain
institutional investors in January
2021.
On January 20, 2021, the Company
entered into a securities purchase agreement with certain
institutional investors, pursuant to which the Company issued and
sold on January 22, 2021, in a
registered direct offering, an aggregate of 3,960,000 of its common
shares at a price of US$1.85 per
share, and in a concurrent private placement, warrants initially
exercisable for the purchase of an aggregate of 1,584,000 of its
common shares with an initial exercise price of US$2.35 per share.
Subsequent Events
As part of the Company's diversification strategy, on
July 27, 2021, the Company entered
into a Sale and Purchase Agreement to acquire 100% of the equity
interests of Precise Space-Time Technology Limited ("Precise
Space-Time Technology") for consideration worth approximately
CNY104.07 million (US$16.12 million), which was a 20% discount
to the valuation of Precise Space-Time Technology provided by an
independent valuation firm. The consideration was comprised of 3
million of the Company's newly issued restricted common shares, 120
million shares of FARL, and approximately CNY10.30 million in cash (US$1.60 million). Precise Space-Time
Technology, through its wholly owned subsidiaries, owns a 51%
equity interest in Shanghai Onway. Shanghai Onway is principally
engaged in the provision of equipment for rural wastewater
treatment and provision of engineering, procurement, and
construction services in relation to wastewater treatment in
China.
About China Natural Resources:
China Natural Resources, Inc., a British Virgin Islands corporation, through
its operating subsidiaries in the
People's Republic of China (the "PRC"), is currently engaged
in the acquisition and exploitation of mining rights in Inner
Mongolia, including preliminary exploration for lead, silver and
other nonferrous metal, has recently entered the wastewater
treatment industry and is actively exploring further business
opportunities in the healthcare and other non-natural resources
sectors.
Forward-Looking Statements:
This press release includes forward-looking statements within
the meaning of the U.S. federal securities laws. These statements
include, without limitation, statements regarding the intent,
belief and current expectations of the Company, its directors or
its officers with respect to: the potential presented by the
healthcare sector in the PRC; the impact on the Company's financial
position of an investment in the healthcare sector of the PRC or
other non-natural resources sectors; its ability to locate and
execute on strategic opportunities; the Company's ability to
diversify its business and revenue base; and the potential for
increased consistent revenue, profit growth, or increased
shareholder returns. Forward-looking statements are not a guarantee
of future performance and involve risks and uncertainties, and
actual results may differ materially from those in the
forward-looking statement as a result of various factors. Among the
risks and uncertainties that could cause the Company's actual
results to differ from its forward-looking statements are: possible
downturns in the healthcare sector in the PRC or other sectors that
the Company may invest in; the results of the next assessment by
the Staff of the Nasdaq Listing Qualifications department of the
Company's compliance with the Nasdaq Listing Rules; uncertainties
related to governmental, economic and political circumstances in
the PRC; uncertainties related to metal price volatility;
uncertainties related to the Company's ability to fund operations;
uncertainties related to possible future increases in operating
expenses, including costs of labor and materials; uncertainties
related to the impact of the COVID-19 pandemic; uncertainties
related to the political situation between the PRC and the United States, and potential negative
impacts on companies with operations in the PRC that are listed on
exchanges in the United States;
and other risks detailed from time to time in the Company's filings
with the U.S. Securities and Exchange Commission. When, in any
forward-looking statement, the Company, or its management,
expresses an expectation or belief as to future results, that
expectation or belief is expressed in good faith and is believed to
have a reasonable basis, but there can be no assurance that the
stated expectation or belief will result or be achieved or
accomplished. Except as required by law, the Company undertakes no
obligation to update any forward-looking statements.
For more information please contact:
David Pasquale
Global IR Partners
New York Office Phone: +1-914-337-8801
CHNR@GlobalIRPartners.com
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SOURCE China Natural Resources, Inc.