SOURCE: Hartcourt Companies Inc

August 30, 2005 09:47 ET

Hartcourt Reports Projected 2005 Transitional Period Results

SHANGHAI, CHINA -- (MARKET WIRE) -- August 30, 2005 -- The Hartcourt Companies, Inc. (OTC BB: HRCT) (Frankfurt: 900009), today announced the highlights of projected operating results for the transitional period ended May 31, 2005.

Revenue was $19.7 million for the transitional period, with over 90% of sales coming from Samsung computer products sold in the Shanghai region and the remaining sales coming from multimedia products sold in China. Revenue increased 28%, compared to last year same period, same geographic area. Samsung notebook sales was the primary contributing factor representing our successful launch of notebook sales into the consumer space.

Gross margin was 6.3% or $1,237K for the transitional period, more than doubled compared to the same period a year ago. The better gross margin was a result of favorable product mix with addition of multimedia sales.

Operating income (EBITDA) was $375K, or 3.3% for the transitional period, compared to a loss of $420K or -1.4% same period last year. The improved operating income resulted from higher gross margin and lower operating expenses. Net income was $123K, or 0.6% compared to $29K, or 0.1% a year ago.

Hartcourt experienced overall improvement of liquidity. Current ratio for the transitional period was 1.48 compared to 1.37 a year ago.

About Hartcourt

Hartcourt's achievements and operations can be found on its web site: www.hartcourt.com

Forward-looking statements

The statements made in this press release, which are not historical facts, contain certain forward-looking statements concerning potential developments affecting the business, prospects, financial condition and other aspects of the company to which this release pertains. The actual results of the specific items described in this release, and the company's operations generally, may differ materially from what is projected in such forward-looking statements. Although such statements are based upon the best judgments of management of the company as of the date of this release, significant deviations in magnitude, timing and other factors may result from business risks and uncertainties including, without limitation, the company's dependence on third parties, general market and economic conditions, technical factors, the availability of outside capital, receipt of revenues and other factors, many of which are beyond the control of the company. The company disclaims any obligation to update information contained in any forward-looking statement.

Contact Information

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    Ms Tingting Ni
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    Fax: + 86 21 51521579
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