SOURCE: Dragon Capital Group Corp.

September 27, 2010 17:06 ET

Dragon Capital Group Corp. Reports Financial Results for the First Six Months of 2010

Revenue Reaches $27.8 Million for First Six Months of 2010 Up From $26.9 Million for First Six Months of 2009; Second Quarter 2010 Net Income Increases by 123% to $277,800 Compared to $124,500 in the Second Quarter of 2009

SHANGHAI, CHINA--(Marketwire - September 27, 2010) - Dragon Capital Group Corp. (PINKSHEETS: DRGV), a leading holding company of emerging high-tech companies in China, announced today the company's financial results for the second quarter and first six months of 2010 ended June 30, 2010.

Financial Highlights:

Revenue for the second quarter ended June 30, 2010 was $15.4 million as compared to $15.0 million recorded in the second quarter of 2009. Cost of goods sold for the second quarter of 2010 were $14.7 million compared to $14.1 million in the second quarter of 2009. Net income for the second quarter of 2010 was $277,800, increasing 123% from the $124,500 recorded in the second quarter of 2009. The increase in net income was largely attributable to a decrease in selling expenses as the overall economic environment improved when compared to the same period in 2009.

Six-Month Financial Results

Revenue for the first six months of 2010 reached $27.8 million, a slight increase from the $26.9 million recorded in the first six months of 2009. For the first six months of 2010, net income attributable to Dragon Capital Group Corp. was $126,000, a significant improvement from the net loss of ($554,000) recorded in the first six months of 2009. The improvement was attributable to a reduction in selling expenses and a loss recorded in 2009 from the sale of its Fomde subsidiary.

Balance Sheet

At June 30, 2010, total assets were $16.3 million with $16.0 million in current assets. This compares to total assets of $15.2 million with $14.9 million in current assets at December 31, 2009. At June 30, 2010, shareholder equity improved to $7.7 million with working capital of $8.6 million compared to shareholder equity of $7.4 million with working capital of approximately $8.2 million at December 31, 2009.

Mr. Lawrence Wang, CEO of Dragon Capital Group, stated, "We are extremely pleased with our performance in the first six months of 2010. We have substantially improved our bottom line performance as we continue to increase our revenue. As the overall economic environment in China continues to improve for our business, we believe we can continue to build on these positive trends. We are committed to achieving continued top line and bottom line growth as we move into the second half of 2010. We remain focused on achieving higher operating efficiencies which we believe can extend our profitability into the coming years as we work diligently to increase our shareholder value."

About Dragon Capital Group Corporation

Dragon Capital Group Corp. (PINKSHEETS: DRGV) is doing business in China through its subsidiaries. Dragon was established to serve as a conduit between Chinese high-growth companies and Western investors. DRGV functions as an incubator of high-tech companies in China, offering support in the critical functions of general business consulting, formation of joint ventures, access to capital, merger & acquisition, business valuation, and revenue growth strategies. DRGV has developed a portfolio of high-tech companies operating in China. For more information about DRGV, please visit http://www.dragoncapital.us


               DRAGON CAPITAL GROUP, CORP. AND SUBSIDIARIES
                        CONSOLIDATED BALANCE SHEET
                                (Unaudited)
                                  ASSETS

                                                  June 30,    December, 31,
                                                   2010           2009
                                               -------------  -------------
CURRENT ASSETS:
Cash and cash equivalents                      $   1,352,432  $   2,236,878
Accounts receivable, net of allowance for
 doubtful accounts of $153,554 and $152,533,
 respectively                                      5,796,220      5,568,519
Other receivables                                  1,327,690      1,179,751
Inventories                                        6,962,814      5,567,730
Investment in marketable securities                  126,000        114,800
Prepaid taxes                                        105,634              -
Prepaid expenses and other                           275,238        190,232
                                               -------------  -------------
Total Current Assets                              15,946,028     14,857,910
                                               -------------  -------------
DERIVATIVE RECEIVABLE                                 54,978         54,978
DUE FROM RELATED PARTY                                71,968         71,667
PROPERTY AND EQUIPMENT - Net                         234,787        240,254
                                               -------------  -------------
Total Assets                                   $  16,307,761  $  15,224,809
                                               =============  =============

     LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Loans payable                                  $      58,749  $     102,381
Loans payable-related party                           22,000         22,000
Accounts payable and accrued expenses              6,056,135      5,620,321
Other payable                                        824,878        685,206
Taxes payable                                        142,015         60,274
Advances from customers                                1,527          1,521
Due to related party                                 216,472        141,031
                                               -------------  -------------
Total Current Liabilities                          7,321,776      6,632,734
                                               -------------  -------------
EQUITY:

Dragon Capital Group, Corp. Common Stock
 ($0.001 Par Value; 500,000,000 Shares
 Authorized; 292,735,578 and 259,644,578
 shares issued and outstanding at June 30, 2010
 and December 31, 2009, respectively)                292,736        259,645
Additional paid-in capital                         5,333,834      5,244,770
Accumulated retained earnings                      1,272,461      1,146,484
Accumulated comprehensive income                     808,957        760,092
                                               -------------  -------------
Total Dragon Capital Group, Corp.                  7,707,988      7,410,991
                                               -------------  -------------
Noncontrolling interest                            1,277,997      1,058,105
                                               -------------  -------------
Total Equity                                       8,985,985      8,592,075
                                               -------------  -------------
Total Liabilities and Equity                   $  16,307,761  $  15,224,809
                                               =============  =============

         See notes to unaudited consolidated financial statements.




              DRAGON CAPITAL GROUP, CORP. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENT OF OPERATIONS
                               (Unaudited)

                           For the Three Months       For the Six Months
                              Ended June 30,            Ended June 30,
                        ------------------------  ------------------------
                            2010         2009         2010         2009
                        -----------  -----------  -----------  -----------
NET REVENUES            $15,373,841  $14,983,463  $27,788,472  $26,899,809
COST OF SALES            14,711,412   14,149,147   26,336,251   25,447,767
                        -----------  -----------  -----------  -----------
GROSS PROFIT                662,429      834,316    1,452,221    1,452,042
                        -----------  -----------  -----------  -----------

OPERATING EXPENSES:
Selling expenses            186,090      359,373      435,514      568,706
Loss on disposition of
 property and equipment       1,609            -        1,609            -
General and
 administrative             (72,287)     159,632      588,139      439,970
                        -----------  -----------  -----------  -----------
Total Operating Expenses    115,412      519,005    1,025,262    1,008,676
                        -----------  -----------  -----------  -----------
INCOME FROM OPERATIONS      547,017      315,311      426,959      443,366
                        -----------  -----------  -----------  -----------

OTHER INCOME
Other income (expense)       (7,762)       3,207       (7,762)       2,705
Interest income (expense)      (128)       4,030       (9,161)      (1,104)
                        -----------  -----------  -----------  -----------
Total Other Income           (7,890)       7,237      (16,923)       1,601
                        -----------  -----------  -----------  -----------
INCOME BEFORE
 DISCONTINUED
 OPERATIONS, INCOME
 TAXES AND
 NONCONTROLLING INTEREST    539,127      322,548      410,036      444,967

DISCOUNTINUED OPERATIONS:
Loss on sale of Fomde
 subsidiaries                     -            -            -     (714,983)
Gain from discontinued
 operations                       -            -            -        5,603
                                                               -----------
Total loss from
 discontinued operations          -            -            -     (709,380)
                                                               -----------

INCOME (LOSS) BEFORE
 INCOME TAXES AND
 NONCONTROLLING INTEREST    539,127      322,548      410,036     (264,413)
INCOME TAXES               (134,898)    (100,684)    (187,146)    (175,382)
                        -----------  -----------  -----------  -----------
NET INCOME (LOSS)           404,229      221,864      222,890     (439,795)
                        -----------  -----------  -----------  -----------
Less: Net income
 attributable to
 noncontrolling interest   (126,404)    (97,374)     (96,913)    (114,194)
                        -----------  -----------  -----------  -----------

NET (LOSS) INCOME
 ATTRIBUTABLE TO DRAGON
 CAPITAL GROUP, CORP.       277,825      124,490      125,977     (553,989)
                        ===========  ===========  ===========  ===========

NET INCOME (LOSS)PER
 COMMON SHARE:
Net (loss) income from
 continuing and
 discontinued
 operations             $      0.00  $      0.00  $      0.00  $      0.00
Weighted commom shares
 outstanding
 - basic and diluted    291,622,941  259,644,578  286,699,512  259,644,578

AMOUNTS ATTRIBUTABLE TO
 DRAGON CAPITAL GROUP,
 CORP. COMMON
 SHAREHOLDERS:
Income from continuing
 operations, net of tax     277,825      124,490      125,977      155,391
Loss from discontinued
 operations, net of tax           -            -            -     (709,380)
                        -----------  -----------  -----------  -----------
Net income (loss)           277,825      124,490      125,977     (553,989)
                        ===========  ===========  ===========  ===========

        See notes to unaudited consolidated financial statements.

Safe Harbor Statement

Certain statements set forth in this press release constitute "forward-looking statements." Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate, or imply future results, performance or achievements, and may contain the word expressions of similar meaning. Such statements are not guarantees of future performance and are subject to risks and uncertainties that could cause the company's actual results and financial position to differ materially from those included within the forward-looking statements. Forward-looking statements involve risks and uncertainties, including those relating to the Company's ability to grow its business. Actual results may differ materially from the results predicted and reported results should not be considered as an indication of future performance.

Contact Information

  • Contact:
    Investor Relations
    Lillian Wong
    Tel: 954-363-7333 ext. 317