UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

 

FORM 8-K

 

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of report (date of earliest event reported): November 8, 2018

 

 

 

H/CELL ENERGY CORPORATION

(Exact name of registrant as specified in its charter)

 

Nevada   000-55802   47-4823945

(State or Other Jurisdiction

of Incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

97 River Road, Flemington, NJ 08822

(Address of principal executive offices) (Zip Code)

 

Registrant’s telephone number, including area code: (908) 837-9097

 

Copy of correspondence to:

 

James M. Turner, Esq.

Marc J. Ross, Esq.

Sichenzia Ross Ference LLP

1185 Avenue of the Americas, 37 th Floor

New York, New York 10036

Tel: (212) 930-9700 Fax: (212) 930-9725

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   

¨

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   

¨

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   

¨

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

 

Emerging growth company x

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

 

 

     
 

 

Item 2.02 Results of Operations and Financial Condition.

 

On November 8, 2018, H/Cell Energy Corporation announced its operating results for the third fiscal quarter ended September 30, 2018. A copy of the press release that discusses this matter is filed as Exhibit 99.01 to, and incorporated by reference in, this report. The information in this Current Report is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, except as shall be expressly set forth by specific reference in any such filing.

 

Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

99.01 Press Release, dated November 8, 2018, issued by H/Cell Energy Corporation*

 

 

* Furnished herewith.

 

  2  
 

 

SIGNATURE

 

Pursuant to the requirement 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.

 

  H/CELL ENERGY CORPORATION
     
Date: November 8, 2018 By: /s/ ANDREW HIDALGO
    Andrew Hidalgo
    Chief Executive Officer

 

  3  
 

 

 

Exhibit 99.01

 

H/Cell Energy Reports FY2018 Third Quarter Financial Results

 

Flemington, NJ, November 8, 2018 (GLOBE NEWSWIRE) — H/Cell Energy Corporation (OTCQB-HCCC) (“HCCC”), a company that designs and implements clean energy solutions featuring hydrogen energy systems, has announced financial results for its fiscal 2018 third quarter ended September 30, 2018.

 

For the three months ended September 30, 2018, HCCC generated revenue of $1,839,491 and a net loss of $267,328, or ($0.04) in earnings per share fully diluted, which includes $69,199 in non-cash charges. For the nine months ended September 30, 2018, HCCC generated revenue of $5,575,640 and a net loss of $364,342, or ($0.05) in earnings per share fully diluted, which includes $200,848 in non-cash charges. As of September 30, 2018, HCCC has submitted overall proposals in the amount of $12,751,061 and had a backlog of projects to complete totaling $715,595. The balance sheet as of September 30, 2018 remained solid with $331,236 in cash, $3,548,607 in assets and $417,338 in working capital.

 

Andrew Hidalgo, CEO of HCCC, commented, “In the third quarter, we committed to investing in the expansion of the renewable energy effort at our Pride Group subsidiary in Australia, which resulted in significant capital expenditures in labor, training and business development. We believe this investment will be the key to launching our renewable energy efforts in the Asia-Pacific region as we are currently quoting many projects in a very active market. Further, our PVBJ subsidiary had a higher level of material purchases in the third quarter for projects to be completed in the fourth quarter. In addition to the capital expenditures for growth initiatives, we absorbed non-cash charges in the third quarter and the year-to-date financials for compliance purposes. Non-cash charges do not affect the cash flow performance or working capital of HCCC. Our subsidiaries are performing well exclusive of these corporate expenses. We have recently initiated several hydrogen energy projects and combined with our continued investments in expanding the renewable energy market effort, we are very encouraged about the future quarters. HCCC continues to build momentum by training our existing subsidiaries in clean energy, identifying many new opportunities and expanding our customer base. We look forward to future growth and building shareholder value.”

 

About H/Cell Energy Corporation:

 

H/Cell Energy Corporation is an integrator that focuses on the design and implementation of clean energy solutions including solar, battery, fuel cell and hydrogen generation systems. In addition, through its subsidiaries, HCCC also provides environmental systems and security systems integration. HCCC serves the residential, commercial and government sectors. Please visit our website at www.hcellenergy.com for more information.

 

Forward Looking Statements:

 

Certain statements in this press release are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. These statements may be identified by the use of forward-looking words such as “anticipate,” “believe,” “forecast,” “estimate,” “expect,” and “intend,” among others. These forward-looking statements are based on current expectations and actual results could differ materially. H/Cell Energy Corporation does not undertake an obligation to update or revise any forward-looking statement. The information set forth herein speaks only as of the date hereof.

 

H/Cell Energy Corporation

Investor Relations

908-837-9097 x-2

 

 
 

 

H/CELL ENERGY CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

 

    September 30, 2018     December 31, 2017  
    (Unaudited)     (Audited)  
ASSETS                
Current assets                
Cash and cash equivalents   $ 331,236     $ 455,700  
Accounts receivable (net retention)     1,230,621       808,050  
Prepaid expenses     23,282       14,669  
Costs and earnings in excess of billings     73,180       51,531  
Total current assets     1,658,319       1,329,950  
                 
Property and equipment, net     362,933       102,573  
Security deposits and other non-current assets     20,711       8,416  
Deferred tax asset     44,257       44,257  
Customer lists, net     88,766       -  
Goodwill     1,373,621       -  
                 
Total assets   $ 3,548,607     $ 1,485,196  
                 
LIABILITIES AND STOCKHOLDERS’ EQUITY                
                 
Current liabilities                
Accounts payable and accrued expenses   $ 830,708     $ 631,385  
Management fees payable – related party     -       31,257  
Earn-out payable     186,346       -  
Billings in excess of costs and earnings     51,798       87,206  
Sales and withholding tax payable     45,154       61,239  
Current equipment notes payable     32,538       -  
Current capital lease payable     68,240       -  
Income tax payable     26,197       98,313  
Total current liabilities     1,240,981       909,400  
                 
Noncurrent liabilities                
Note payable     222,963       -  
Capital leases     149,590       -  
Equipment notes payable     118,606       -  
Convertible note payable – related party, net of discount     14,268       -  
Total noncurrent liabilities     505,427       -  
                 
Total liabilities     1,746,408       909,400  
                 
Commitments and contingencies                
                 
Stockholders’ equity                
Preferred stock - $0.0001 par value; 5,000,000 shares authorized;
0 shares issued and outstanding
    -       -  
Common stock - $0.0001 par value; 25,000,000 shares authorized;
7,586,024 and 7,041,579 shares issued and outstanding
as of September 30, 2018 and December 31, 2017, respectively
    758       704  
Additional paid-in capital     2,967,004       1,335,656  
Accumulated deficit     (1,096,096 )     (731,754 )
Accumulated other comprehensive loss     (69,467 )     (28,810 )
Total stockholders’ equity     1,802,199     $ 575,796  
                 
TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY   $ 3,548,607     $ 1,485,196  

 

 
 

 

H/CELL ENERGY CORPORATION

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS – OTHER COMPREHENSIVE INCOME

 

    For the Three Months Ended
September 30,
   

For the Nine Months Ended
September 30,

 
    2018     2017     2018     2017  
                         
Revenue                                
Construction income   $ 1,830,992     $ 1,292,905     $ 5,535,352     $ 5,050,155  
Related party     8,499       45,666       40,288       85,919  
Total revenue     1,839,491       1,338,571       5,575,640       5,136,074  
                                 
Cost of goods sold                                
Direct costs     1,438,669       870,369       3,901,125       3,432,098  
Direct costs – related party     9,019       37,304       40,636       87,649  
Total cost of goods sold     1,447,688       907,673       3,941,761       3,519,747  
                                 
Gross profit     391,803       430,898       1,633,879       1,616,327  
                                 
Operating expenses                                
General and administrative expenses     607,125       437,344       1,850,140       1,379,415  
Management fees – related party     19,500       46,000       58,500       138,000  
Total operating expenses     626,625       483,344       1,908,640       1,517,415  
                                 
Income (loss) from operations     (234,822 )     (52,446 )     (274,761 )     98,912  
Income tax provision (benefit)     -       -       -       -  
                                 
Income (loss) before other income and expense     (234,822 )     (52,446 )     (274,761 )     98,912  
                                 
Other expenses                                
Interest expense     7,544       -       21,636       -  
Interest expense – related party     19,877       -       52,768       -  
Change in fair value earn-out     4,290       -       11,028       -  
Loss on fixed asset disposal     795       -       4,149       -  
Total other expenses     28,216       -       78,553       -  
                                 
Net income (loss)   $ (267,328 )   $ (52,446 )   $ (364,342 )   $ 98,912  
                                 
Other comprehensive income (loss), net                                
                                 
Foreign currency translation adjustment     (7,828 )     5,928       (40,657 )     24,345  
                                 
Comprehensive income (loss)   $ (275,156 )   $ (46,518 )   $ (404,999 )   $ 123,257  
                                 
Earnings (loss) per share                                
Basic   $ (0.04 )   $ (0.01 )   $ (0.05 )   $ 0.02  
Diluted   $ (0.04 )   $ (0.01 )   $ (0.05 )   $ 0.01  
Weighted average common shares outstanding                                
Basic     7,586,024       7,084,436       7,469,307       6,601,873  
Diluted     7,586,024       7,084,436       7,469,307       7,526,763