THE HARTCOURT COMPANIES INC. 
By
Second Quarter 2009 Highlights:
-- Total revenues were $955,847 for the six months ended November 30,
2009, increased 11% from $859,963 in the same period 2008;
-- Gross profit in the second quarter was $378,992 and gross margin was
76.0%;
-- For the six months ended November 30, 2009, gross profit was $727,948
and gross margin was 76%;
-- Operating expenses decreased 42.8% to $170,911 for the three months
ended November 30, 2009 compared with that in the same period 2008;
-- Net income was $55,829 for the three months ended November 30, 2009;
-- Hartcourt entered in an engagement letter with KingWeet AMS, which
helped on investor relations services.
"We continued to be optimistic on the prospects for
Second Quarter 2009 Results
Total revenues for the second quarter of 2009 decreased 22.5% to
Gross profit in the second quarter of 2009 was
Operating expenses in the second quarter of 2009 were
Operating income was
Net income for the second quarter of 2009 was
Six Month Results
For the first half of 2009, revenues increased to
Financial Condition
As of
Subsequent Events
On
About KingWeet International Ltd. After Market Support (KingWeet AMS)
KingWeet AMS is a financial marketing firm specializing in creating
liquidity for publicly traded stocks and a wholly owned subsidiary of Keating
International Ltd. KingWeet AMS is uniquely positioned to provide an
outsourced, high-level investor relations solution that combines in-depth
understanding of
About Hartcourt Companies, Inc.
Founded in 1983, Hartcourt is a U.S. corporation with subsidiaries in
Forward-looking Statements
The information contained herein includes forward-looking statements.
These statements relate to future events or to our future anticipated
financial performance, and involve known and unknown risks, uncertainties and
other factors that may cause our actual results, levels of activity,
performance, or achievements to be materially different from any future
results, levels of activity, performance or achievements expressed or implied
by these forward-looking statements. You should not place undue reliance on
forward-looking statements since they involve known and unknown risks,
uncertainties and other factors which are, in some cases, beyond our control
and which could, and likely will, materially affect actual results, levels of
activity, performance or achievements. Any forward-looking statement reflects
our current views with respect to future events and is subject to these and
other risks, uncertainties and assumptions relating to our operations, results
of operations, growth strategy and liquidity. We do not intend to publicly
update or revise these forward-looking statements for any reason, or to update
the reasons actual results could differ materially from those anticipated in
these forward-looking statements, even if new information becomes available in
the future. The safe harbor for forward-looking statements contained in the
Securities Litigation Reform Act of 1995 protects companies from liability for
their forward-looking statements if they comply with the requirements of the
Act. In addition, please refer to the Risk Factor section of our 2008 Form
10-K filed with the Securities and Exchange Commission on
The Hartcourt Companies, Inc. and Subsidiaries
Unaudited Consolidated Statements of Operations
Three Months Ended Six Months Ended
November 30, November 30,
2009 2008 2009 2008
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenues $498,909 $643,996 $955,847 $859,963
Cost of Goods Sold 119,917 33,782 227,899 53,723
Gross Profit 378,992 610,214 727,948 806,240
Operating Expenses
Selling, general and
administrative 57,763 293,246 292,990 420,794
Depreciation and
amortization 113,148 5,495 169,982 8,249
Total operating
expenses 170,911 298,741 462,972 429,043
Income from continued
operations 208,081 311,473 264,976 377,197
Other Income (Expense)
Foreign currency
exchange gain 5,255 45,753 5,049 --
Interest income 14,003 -- 20,998 51,189
Gain on settlement
debt -- 188,765 -- 188,848
Total other income
(expense) 19,258 234,518 26,047 240,037
Income from continued
operations before
income taxes and
noncontrolling 227,339 545,991 291,023 617,234
Provision for Income
Taxes (44,646) (74,391) (81,415) (110,193)
Noncontrolling
interest, net of
taxes (126,864) (196,967) (242,025) (255,470)
Net Income $55,829 $274,633 $(32,417) $251,571
Basic Earnings Per
Share $0.00 $0.00 $0.00 $0.00
Basic Weighted Average
Shares Outstanding 386,966,816 255,430,112 386,966,816 264,935,687
Diluted Earnings Per
Share $0.00 $0.00 $0.00 $0.00
Diluted Weighted
Average Shares
Outstanding 386,966,816 255,430,112 386,966,816 266,613,190
The Components of
Other Comprehensive
Income
Net Income $55,829 $274,633 $(32,417) $251,571
Foreign currency
translation
adjustment 4,769 30,001 8,563 57,533
Comprehensive Income $60,598 $304,634 $(23,854) $309,104
The Hartcourt Companies, Inc. and Subsidiaries
Unaudited Consolidated Balance Sheet
ASSETS
November 30, 2009 May 31, 2009
(Unaudited) (Unaudited)
Current Assets
Cash and cash equivalents $89,859 $102,085
Accounts receivable 1,561,316 863,244
Loans receivable 944,570 822,551
Prepaid expenses 19,737 5,792
Total current assets 2,615,482 1,793,672
Property and equipment, net 45,898 57,640
Intangible assets, net 3,821,992 3,923,356
$6,483,372 $5,774,668
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable $-- 141,331
Accrued expenses and other current
liabilities 1,690,923 1,337,571
Loan payable 274,429 --
Due to related parties 185,211 246,862
Total current liabilities 2,150,563 1,725,764
Stockholders' Equity
Original preferred stock $(0.01 par
value, 1,000 shares authorized, none
issued and outstanding) -- --
Class A preferred stock(10,000,000
shares authorized, none issued and
outstanding) -- --
Common stock ($0.001 par value,
424,999,000 shares authorized,
389,015,544 and 386,966,816 issued
and outstanding, respectively) 386,967 386,967
Additional paid-in capital 77,238,990 77,156,131
Treasury stock, at cost, 2,048,728
shares (48,728) (48,728)
Other comprehensive loss (152,142) (143,579)
Noncontrolling interest 394,288 152,261
Accumulated deficit (73,486,566) (73,454,148)
Total stockholders' equity 4,332,809 4,048,904
$6,483,372 $5,774,668
The Hartcourt Companies, Inc. and Subsidiaries
Unaudited Consolidated Statements of Cash Flows
Six Months Ended November 30,
2009 2008
(Unaudited) (Unaudited)
Cash flows from operating activities
Net Income $(32,417) $251,571
Adjustments to reconcile net cash
provided by
operating activities
Depreciation and amortization 113,148 8,249
Noncontrolling Interest 242,025 255,470
Stock options issued for service 82,859 79,709
Stock issued for services and
compensations -- 58,922
Gain on settlement of debt -- (188,848)
Net change in assets and liabilities
Accounts receivables and other
receivables (699,208) (593,742)
Inventories -- 6,630
Prepaid expenses (13,162) (187,571)
Accounts payable 141,331 (131,570)
Accrued expenses and other current
liabilities 69,784 238,452
Net cash used in operating activities (95,640) (202,728)
Cash flows from investing activities
Loan receivable (121,695) --
Cash received on acquisition of
Subsidiary -- 6,117
Net cash used in investing activities (121,695) 6,117
Cash flows from financing activities
Due to related parties (61,651) --
Loan payable 274,429 --
Issuance of shares for cash -- 400,000
Proceeds from (payments to) related
parties-net -- (133,597)
Net cash provided by (used in)
financing activities 212,778 266,403
Effect of exchange rate changes on
cash and cash equivalents (7,669) (57,532)
Net increase (decrease) in cash (12,226) 12,260
Cash and cash equivalents at
beginning of period 102,085 4,907
Cash and cash equivalents at end of
period $89,859 $17,167
SOURCE Hartcourt Companies, Inc.
