UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the Month of May 2022
Commission File No.: 333-204074
WINS FINANCE HOLDINGS INC.
1F, Building 1B
No. 58 Jianguo Road, Chaoyang District
Beijing 100024, People’s Republic of China
(Address of Principal Executive Offices.)
2 Wall Street
8th Floor
New York, NY 10005
(646) 694-8538
(New York Office)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
| Form 20-F x | Form 40-F ¨ |
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): _____
Results of Operations and Financial Condition.
On May 31, 2022, Wins Finance Holdings Inc. (the “Company”) released its unaudited and unreviewed financial results for the six months ended December 31, 2021. A copy of the results is attached as Exhibit 99.1.
Financial Statements and Exhibits.
| Exhibit No. | Description |
| 99.1 | December 31, 2021 financial results |
SIGNATURE
Pursuant to the requirements 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.
Dated: May 31, 2022
| WINS FINANCE HOLDINGS INC. | ||
| By: | /s/ Renhui Mu | |
| Name: | Renhui Mu | |
| Title: | Chief Executive Officer | |
Exhibit 99.1
Wins Finance Holdings Inc. Reports Unaudited Financial Results for the Six Months Ended December 31, 2021
BEIJING and NEW YORK, May 31, 2022 -- Wins Finance Holdings Inc. ("Wins Finance" or the "Company") (OTC: WINS), an investment and asset management company that provides integrated financing solutions to small and medium enterprises ("SMEs") in China, today announced its unaudited financial results for the first six months ended December 31, 2021.
Fiscal Six Months Ended December 31, 2021 - Financial and Operational Summary
| · | Direct financing lease interest income was $0.5 million, compared to $0.8 million for the corresponding period ended December 31, 2020. |
| · | Interest income on securities-held to maturity was nil, compared to nil for the corresponding period ended December 31, 2020. |
| · | Income from the financial advisory and lease agency was nil, compared to nil for the corresponding period ended December 31, 2020. |
On June 9, 2020, the Changzhi Public Security Bureau (the “Bureau”) froze the assets of Jinchen Agriculture and its subsidiary Dongsheng Guarantee. Our legal counsel was unable to determine the cause of the freeze as the authorities did not provide us with this information, and our legal counsel advised us that we no longer have control of the assets or operations of both Jinchen Argiculture and Dongsheng Guarantee. Consequently, the Company’s Board of Directors voted to dispose of Jinchen Agriculture and Dongsheng Guarantee.
On December 31, 2020, Wins Finance and Shanghai Guyuan signed an asset disposal agreement, pursuant to which on January 6, 2021, Wins Finance, sold its entire interest in Shanxi Jinchen Agriculture Ltd. (“Jinchen Agriculture”) (including its subsidiary Shanxi Dongsheng Finance Guarantee Co., Ltd. (“Dongsheng Guarantee”)) to Shanghai Guyuan (the “Purchaser”) in exchange for the Purchaser assuming the obligations of Jinchen Agriculture.
In view of the slowdown in the Chinese economy and the impact of COVID-19, lessees’ ability to repay their rental expenses was significantly impaired. We continue to be cautious about securing new leasing customers in the current economic environment. We have instituted further risk controls to mitigate the risks inherent in our financial leasing business and strengthen the recovery of our lease receivables. In addition, we are intent upon expanding our financing channels, developing new strategies to increase our cash flow and seeking out strategic investors to invest in our Company to help fund our initiatives. we expect our [medical business and trade business] to become our new business growth points in the future. We believe that we will be able to weather the currently difficult economic environment.
Financial Results for the Six Months Ended December 31, 2021
We currently offer the following principal products and services to our customers, which primarily constitute SMEs: (1) financial leasing; and (2) financial advisory and agency services.
Direct financing lease interest income
Direct financing lease interest income generated from payments under direct financing leases with customers was $0.5 million for the six months ended December 31, 2021, a decrease of $0.3 million, or 37.5%, as compared to $0.8 million for the six months ended December 31, 2020. The decrease was primarily attributable to a slowdown in China's economy due to the impact of the global COVID-19 pandemic.
Non-interest expenses
Non-interest expense was $0.5 million for the six months ended December 31, 2021, as compared to non-interest expense of $1.0 million for the six months ended December 31, 2020. The decrease was mainly due to the decrease in legal and audit fees during the six months ended December 31, 2021.
Income before taxes
Income before taxes was $1.7 million for the six months ended December 31, 2021, an increase of $4.4 million as compared to an income before taxes of $(2.7) million for the six months ended December 31, 2020. The increase was attributable to the prior accounting error adjustments.
Net income
Net income was $1.7 million for the six months ended December 31, 2021, an increase of $ 16.3 million as compared to net income of $(14.6) million for the six months ended December 31, 2020. The increase was mainly due to the prior accounting error adjustments.
Current Outlook
The first six months of fiscal 2022 has been a period of transition for the Company given its disposal of its financial guarantee business as well as the lingering economic impact of the COVID-19 pandemic.
Our board of directors adopted a 2022 Equity Incentive Plan in May 2022 which provides for the issuance of up to 9,498,725 shares under the plan. The purpose of the Plan is to encourage and enable the officers, employees, Non-Employee Directors and Consultants of Wins Finance Holdings, Inc. and its Affiliates upon whose judgment, initiative, and efforts the Company largely depends for the successful conduct of its business to acquire a proprietary interest in the Company. It is anticipated that providing such persons with a direct stake in the Company’s welfare will assure a closer identification of their interests with those of the Company and its stockholders, thereby stimulating their efforts on the Company’s behalf and strengthening their desire to remain with the Company. No grants have been made under the plan as of the date of this release.
We believe that our operating experience and enhanced risk management protocols will ultimately help to propel growth once business conditions normalize and our competitive position in our sector continues to strengthen. However, we note that the period-to-period financial results of this sector is affected by the complexity, uncertainties and changes in China’s economic conditions as well the regulations governing the industry and can cause fluctuations in our periodic operating and financial results.
About Wins Finance Holdings Inc.
Wins Finance Holdings Inc. (“Wins Finance”) is an integrated financing solution provider that assists Chinese small and medium enterprise (SMEs) that have limited access to financing and enables them to obtain funding for business development. The Company is focused on identifying value accretive investment opportunities and assets in China and the United States that can be enhanced through the strategic engagement of its management team and its familiarity with the Chinese investment community to help generate long-term value for shareholders. Wins Finance believes that it is well positioned to leverage its expertise and existing operations in China to build a comprehensive platform for the provision of lending and other financing solutions to China’s under-served SMEs segment. For more information, please visit www.winsholdings.com.
Forward Looking Statements
This news release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. All statements other than statements of historical fact in this press release are forward-looking statements and involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. These forward-looking statements are based on management’s current expectations, assumptions, estimates and projections about the Company and the industry in which the Company operates, but involve a number of unknown risks and uncertainties. Further information regarding these and other risks are described in the Company’s Annual Report on Form 20-F for the year ended June 30, 2021 and in the Company’s other filings with the U.S. Securities and Exchange Commission. 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 actual results may differ materially from the anticipated results. You are urged to consider these factors carefully in evaluating the forward-looking statements contained herein and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by these cautionary statements.
Company Contacts:
Wins Finance Holdings Inc.
1177 Avenue of the Americas
5th
Floor
New York, NY 10036
E-mail: info@winsholdings.com
WINS FINANCE HOLDINGS INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
| December 31, 2021 |
Audited June 30, 2021 |
|||||||
| ASSETS | ||||||||
| Cash | $ | 21,151 | $ | 6,621 | ||||
| Restricted cash | 1,733 | 22,009 | ||||||
| Commission receivable | 16,469 | - | ||||||
| Net investment in direct financing leases | 7,615,902 | 2,778,471 | ||||||
| Interest receivable | - | - | ||||||
| Operating lease, right-of-use asset | (182,199 | ) | 50,935 | |||||
| Property and equipment, net | 2,771 | 2,883 | ||||||
| Deferred tax assets, net | ||||||||
| Other assets | 2,988,548 | 770,985 | ||||||
| Non-marketable investment | ||||||||
| Assets of disposal group classified as held for sale | ||||||||
| TOTAL ASSETS | $ | 10,464,375 | $ | 3,631,904 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Liabilities | ||||||||
| Bank loans for capital lease business | $ | $ | ||||||
| Other loans for capital lease business | - | |||||||
| Interest payable | ||||||||
| Income tax payable | 2,793 | |||||||
| Deposits from direct financing leases | 4,694,703 | 2,050,035 | ||||||
| Operating lease liability-current | 37,961 | 55,022 | ||||||
| Other liabilities | 62,458,572 | 3,715,268 | ||||||
| Due to related party | 464,000 | 464,000 | ||||||
| Operating lease liability-non-current | (215,490 | ) | ||||||
| Liabilities of disposal group classified as held for sale | ||||||||
| Total Liabilities | $ | 67,442,539 | 6,284,325 | |||||
| Stockholders’ Equity | ||||||||
| Common stock (par value $0.0001 per share, 100,000,000 shares authorized; 19,837,642 issued and outstanding at June 30, 2019 and 2018) | $ | 1,984 | 1,984 | |||||
| Additional paid-in capital | 153,707,338 | 211,934,432 | ||||||
| Statutory reserve | 954,495 | 4,687,085 | ||||||
| Retained earnings | (201,471,021 | ) | (206,948,669 | ) | ||||
| Accumulated other comprehensive loss | (10,170,960 | ) | (12,327,253 | ) | ||||
| Total Stockholders’ Equity | (56,978,164 | ) | (2,652,421 | ) | ||||
| TOTAL LIABILITIES AND EQUITY | $ | 10,464,375 | $ | 3,631,904 | ||||
WINS FINANCE HOLDINGS INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND
COMPREHENSIVE INCOME (LOSS)
| For six months ended December 31, | ||||||||
| 2021 | 2020 | |||||||
| Direct financing lease income | ||||||||
| Direct financing lease interest income | $ | 492,100 | $ | 816,274 | ||||
| Interest expense for direct financing lease | 61,483 | |||||||
| Business collaboration fee and commission expenses for leasing projects | (68,342 | ) | ||||||
| Provision for lease payment receivable | 1,776,932 | (2,556,731 | ) | |||||
| Net direct financing lease interest income after provision for receivables | $ | 2,269,032 | $ | (1,747,316 | ) | |||
| Financial advisory and lease agency income | - | - | ||||||
| Net revenue | $ | 2,269,032 | $ | (1,747,316 | ) | |||
| Non-interest income | ||||||||
| Interest on investment securities-held to maturity | - | |||||||
| Total non-interest income | $ | - | $ | |||||
| Non-interest expense | ||||||||
| Business taxes and surcharges | (232 | ) | (460 | ) | ||||
| Salaries and employee charges | (296,375 | ) | (405,228 | ) | ||||
| Rental expenses | (37,590 | ) | (54,006 | ) | ||||
| Other operating expenses | (189,036 | ) | (515,654 | ) | ||||
| Total non-interest expense | $ | (523,233 | ) | $ | (975,348 | ) | ||
| Income before taxes | 1,745,799 | (2,722,664 | ) | |||||
| Income tax credit | (741 | ) | 959,003 | |||||
| NET (LOSSES)/INCOME FRROM CONTINUING OPERATION | $ | 1,745,058 | 77 |
$ | (1,763,661 | ) | ||
| Income from discontinued operation | $ | (12,805,074 | ) | |||||
| Total Net (Losses)/Income | 1,745,058 | (14,568,735 | ) | |||||
| Other comprehensive income (loss) | ||||||||
| Foreign currency translation adjustment | 2,156,293 | (49,966,235 | ) | |||||
| COMPREHENSIVE (LOSS)/INCOME | $ | 3,901,351 | $ | (64,534,970 | ) | |||
| Weighted-average ordinary shares outstanding | ||||||||
| Basic | 19,837,642 | 19,837,642 | ||||||
| Diluted | 19,837,642 | 19,837,642 | ||||||
| Earnings per share | ||||||||
| Basic | $ | 0.09 | $ | (0.73 | ) | |||
| Diluted | $ | 0.09 | $ | (0.73 | ) | |||
| From continuing operation | $ | 0.09 | $ | (0.09 | ) | |||
| From discontinued operation | $ | $ | (0.65 | ) | ||||