China Recycling Energy Corporation Reports Results for the Full Year 2019

XI’AN, China, May 14, 2020 (GLOBE NEWSWIRE) — China Recycling Energy Corporation (NASDAQ: CREG) (“CREG” or “the Company”), an industrial waste-to-energy solution provider in China, today reported certain highlights of its audited operating results for the full year ended December 31, 2019.
“As of December 31, 2019, we maintained a healthy cash and cash equivalents balance of approximately $16.22 million,” stated Mr. Guohua Ku, Chairman and CEO of the Company. In addition, we have accomplished significant cost cutting throughout our entire organization, evidenced by net loss narrowed by approximately 86.7% to approximately $(8.77) million in fiscal 2019, as compared to approximately $(76.22) million in the same period of fiscal 2018. We are executing what we believe is a clear plan to manage our business efficiently and effectively through the coronavirus pandemic, prioritizing the health and safety of our customers and teams.  We believe our financial position and contingency plans will allow us to retain the financial flexibility to pursue the fast-growing smart power sector. We feel we are back on track to continue evaluating several exciting strategic opportunities to reinvest in innovative growth initiatives that we expect will reposition our energy sustainability business in direct relation to smart power integrated solutions to vastly improve climate change efficiency in China, which we believe will better serve our clients, employees and shareholders. As such, we will maintain our focus on expense and working capital discipline so that we move forward with a strengthened platform to attempt to capitalize on the significant opportunities we see for growth.” “Lastly, I want to thank all our employees for their service to the business and to our loyal customers.  I am confident we will emerge from this challenge even stronger, given the strength of our brand, our people and the new opportunities ahead of us.”  Financial Summary for the Full Year Ended December 31, 2019Cash and cash equivalents were approximately $16.22 million as of December 31, 2019, a decrease of approximately $37.00 million as compared to approximately $53.22 million as of December 31, 2018.Net sales were $0.70 million as compared to $4.89 million for the same period of 2018. The sales were from the electricity sold by Erdos TCH Energy Saving Development Co., Ltd (“Erdos TCH”), a joint venture between one of the Company subsidiaries and Erdos Metallurgy Co., Ltd (“Erdos”). However, since May 2019, Erdos TCH has ceased its operations due to renovations and furnace safety upgrades of Erdos. During this period, Erdos will compensate Erdos TCH RMB 1 million ($145,460) per month, until operations resume. The Company expects the resumption of operations of Erdos TCH in July 2020.Interest income on sales-type leases for the year ended December 31, 2019 was approximately $0.17 million, a decrease of approximately $3.14 million from approximately $3.14 million for the year ended December 31, 2018. The Company only had Pucheng Phase I and II systems since then, which the Company has ceased to accrue interest income since April 2018 because Pucheng power generation systems were suspended due to strict environmental protection policies and lack of supply of biomass waste raw materials.Total operating income was approximately $0.87 million as compared to approximately $8.20 million for the same period of 2018.Total operating expenses were $9.98 million for the year ended December 31, 2019, compared to $66.19 million for the year ended December 31, 2018, a decrease of $56.21 million or 85%. The decrease was mainly due to decreased bad debts expense by $26.82 million, decreased assets impairment loss on fixed assets and construction in progress by $27.55 million, and decreased operating expense by $2.86 million of Erdos TCH due to cessation of operations.Net loss for the year ended December 31, 2019 was approximately $(8.77) million or approximately $(5.61) per fully diluted share compared to approximately $65.99 million or approximately $(76.22) per fully diluted share for the year ended December 31, 2018, a decrease of loss of $57,224,141. This decrease in net loss was mainly due to the decrease in operating expenses as described above.About China Recycling Energy Corp.China Recycling Energy Corporation (Nasdaq: CREG) (“CREG” or “the Company”) is based in Xi’an, China and provides environmentally friendly waste-to-energy technologies to recycle industrial byproducts for steel mills, cement factories and coke plants in China. Byproducts include heat, steam, pressure, and exhaust to generate large amounts of lower-cost electricity and reduce the need for outside electrical sources. The Chinese government has adopted policies to encourage the use of recycling technologies to optimize resource allocation and reduce pollution. Currently, recycled energy represents only an estimated 1% of total energy consumption and this renewable energy resource is viewed as a growth market due to intensified environmental concerns and rising energy costs as the Chinese economy continues to expand. The Company’s management and engineering teams have over 20 years of experience in industrial energy recovery in China. For more information about CREG, please visit http://creg-cn.investorroom.com.Safe Harbor StatementThis press release may contain certain “forward-looking statements” relating to the business of CREG and its subsidiary companies. All statements, other than statements of historical fact included herein are “forward-looking statements.” These forward-looking statements are often identified by the use of forward-looking terminology such as “believes,” “expects” or similar expressions, involve known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including, but not limited to, the risks and uncertainties associated with market conditions and the satisfaction of customary closing conditions relating to the registered direct offering and those discussed in the Company’s annual and periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.  
CHINA RECYCLING ENERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETSThe accompanying notes are an integral part of these consolidated financial statements.F-1CHINA RECYCLING ENERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSSThe accompanying notes are an integral part of these consolidated financial statements.F-2CHINA RECYCLING ENERGY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWSThe accompanying notes are an integral part of these consolidated financial statements.F-3Investor Relations Inquiries:
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