UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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 December 2021

 

Commission File Number 001-39001

 

Blue Hat Interactive Entertainment Technology

(Translation of registrant’s name into English)

   
7th Floor, Building C, No. 1010 Anling Road
Huli District, Xiamen, China 361009
(Address of principal executive office)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F ☒ 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):☐

 

 
 

 

Blue Hat Interactive Entertainment Technology furnishes under the cover of Form 6-K the following:

 

Exhibit No. Description of Exhibit
99.1 Press Release dated December 6, 2021, announcing its unaudited financial results for the three and nine months ended September 30, 2021

 

SIGNATURES

 

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.

 

Date: December 6, 2021

 

  BLUE HAT INTERACTIVE   ENTERTAINMENT TECHNOLOGY
   
  By: /s/ Xiaodong Chen
    Name: Xiaodong Chen
    Title: Chief Executive Officer

 

 

 

 

 

 

 

Exhibit 99.1

 

 

 

Blue Hat Announces Financial Results for Third Quarter of 2021, Highlighted by a 235.6% Increase in Total Revenues to US $13.3 Million

 

Xiamen, China – December 6, 2021: Blue Hat Interactive Entertainment Technology (“Blue Hat” or the “Company”) (NASDAQ: BHAT), a leading communication services and internet data center (“IDC”) business provider and developer, and an operator of mobile games and augmented reality (“AR”) education curricula and products in China, today announced its unaudited financial results for the three and nine months ended September 30, 2021 (“Third Quarter 2021” and “Nine Months 2021”, respectively).

 

Third Quarter 2021 and Nine Months 2021 Financial Highlights

 

Total revenues of US $13.3 million, up 235.6% from US $4.0 million in the prior-year period, driven primarily by increased sales from the IDC business with support from the mobile gaming and information technology services businesses

 

Gross profit of US $5.4 million, up 94.3% from US $2.8 million in the prior-year period

 

Income from operations of US $2.0 million, unchanged from US $2.0 million in the prior-year period

 

Net income of US $2.0 million, up 21.5% from US $1.7 million in the prior-year period

 

Nine Months 2021 total revenues of US $31.3 million, up 254.3% from US $8.8 million in the prior-year period

 

Nine Months 2021 gross profit of US $14.2 million, up 120.7% from US $6.4 million in the prior-year period

 

Nine Months 2021 income from operations of US $5.6 million, up 55.3% from US $3.6 million in the prior-year period

 

Nine Months 2021 net income of US $3.4 million, up 16.4% from US $2.9 million in the prior-year period

 

US $11.9 million in cash and cash equivalents at September 30, 2021

 

Management Commentary

 

Mr. Xiaodong Chen, CEO of Blue Hat, stated, “2021 has been a monumental year for Blue Hat, with significant gains generated due to a proactive acquisition strategy across our integrated businesses. The Company achieved record revenues of US $31.3 million in the first nine months of 2021, more than tripling our top line from the prior-year period with the launch of our communication services/IDC business with the acquisition of Xunpusen Technology Co., Ltd. (“Xunpusen”) in late 2020. In addition, we continue to build an interactive entertainment platform including mobile games, augmented reality toys, and a fully immersive education curriculum. We are pleased with the improved results on the bottom line during Third Quarter 2021 as we have continued to integrate these businesses into Blue Hat’s operations, and we remain confident in our ability to continue executing on our growth strategy to conclude the year on a strong note. We look forward to making continued investments in our various lines of business, including technology development and partnership expansions, which we believe will establish a firm foundation for long-term growth.”

 

 
 

 

 

 

Third Quarter 2021 Results

 

Total revenues were US $13.3 million for Third Quarter 2021, an increase of US $9.3 million, or 235.6%, compared to US $4.0 million in the prior-year period. The revenue growth was primarily attributable to increased sales from the mobile games and communication services businesses, as well as contributions from the information technology services business, which launched in the fourth quarter of 2020.

 

Revenues from communication services were US $5.8 million for Third Quarter 2021, compared to nil in the prior-year period. The gain was due to the acquisition of Xunpusen in the second half of 2020.

 

Revenues from mobile games increased to US $3.4 million for Third Quarter 2021, from US $0.6 million in the prior-year period, following the acquisition of Fuzhou Csfctech Co., Ltd. (“Csfctech”) in January 2021.

 

Revenues from information technology services were US $1.6 million for Third Quarter 2021, compared to nil in the prior-year period. This is a new line of business that the Company launched in late 2020, whereby Blue Hat provides products and technical services that enable users to access technical service platforms to utilize products and services from third-party platforms and medial channels (such as WeChat Official Account, Mini Program, APP, Tik Tok, Toutiao, Quick Worker, etc.).

 

Revenues from sales of interactive toys (game series) were US $1.5 million for the Third Quarter 2021, compared to US $3.3 million in the prior-year period. The decrease was due to the Company’s focus on developing other areas of business during the period.

 

Revenues from sales of interactive toys (animation series) were US $1.0 million for Third Quarter 2021, compared to US $0.02 million in the prior-year period.

 

Revenues from AR education, previously included under interactive toys (animation series), were US $0.04 million for Third Quarter 2021. Growth in the AR education business has been primarily driven by the roll-out and implementation of Blue Hat’s ARIC system to various schools. This business may be subject to seasonality as the Company anticipates higher revenues from AR education in the first and third quarters of a year, coinciding with the beginning of school terms in February and September.

 

Gross profit increased 94.3% to US $5.4 million for Third Quarter 2021, from US $2.8 million in the prior-year period. Gross margin was 40.7% for Third Quarter 2021, compared to 70.2% in the prior-year period. The decrease in gross margin was due to higher initial costs associated with establishing the new businesses and integrating acquisitions into the Company’s operations.

 

Total operating expenses increased to US $3.4 million for Third Quarter 2021, from US $0.8 million in the prior-year period, as a result of increased selling expenses related to marketing the Company’s new businesses and promoting newly-launched mobile games following the acquisition of Csfctech, as well as increased R&D expenses related to the development of new mobile games.

 

2
 

 

 

 

Income from operations was US $2.0 million for Third Quarter 2021, unchanged from US $2.0 million in the prior-year period.

 

Net income increased 21.5% to US $2.0 million for Third Quarter 2021, from US $1.7 million in the prior-year period. The increase in net income is mainly attributable to the increase in total revenues.

 

Basic and diluted earnings per share were US $0.04 for Third Quarter 2021, compared to US $0.05 for the prior-year period.

 

Nine Months 2021 Results

 

Total revenues were US $31.3 million for Nine Months 2021, an increase of US $22.4 million, or 254.3%, compared to US $8.8 million in the prior-year period. The revenue growth was largely attributable to increased revenue contributions from the Company’s IDC and mobile games businesses, following the acquisitions of Xunpusen in late 2020 and Csfctech in January 2021.

 

Revenues from communication services were US $12.9 million for Nine Months 2021, compared to nil in the prior-year period.

 

Revenues from mobile games increased to US $9.2 million for Nine Months 2021, from US $1.8 million in the prior-year period.

 

Revenues from information technology services were US $1.6 million for Nine Months 2021, compared to nil in the prior-year period.

 

Revenues from sales of interactive toys (game series) were US $5.9 million for Nine Months 2021, compared to US $7.0 million in the prior-year period.

 

Revenues from sales of interactive toys (animation series) were US $1.4 million for Nine Months 2021, compared to US $0.02 million in the prior-year period.

 

Revenues from AR education, previously included under interactive toys (animation series), were US $0.2 million for Nine Months 2021.

 

Gross profit increased 120.7% to US $14.2 million for Nine Months 2021, from US $6.4 million in the prior-year period.

 

Interactive toys (animation series): 3.2%, or US $0.05 million

 

Interactive toys (game series): 58.3%, or US $3.4 million

 

3
 

 

 

 

Mobile games: 82.6%, or US $7.6 million

 

AR education: 88.5%, or US $0.2 million

 

Communication services: 20.3%, or US $2.6 million

 

Information technology services: 18.8%, or US $0.3 million

 

Total gross margin was 45.5% for Nine Months 2021, compared to 73.0% in the prior-year period.

 

Total operating expenses increased to US $8.6 million for Nine Months 2021, from US $2.8 million in the prior-year period, primarily as a result of increased expenses as described above under “Third Quarter 2021 Results.”

 

Income from operations increased 55.3% to US $5.6 million for Nine Months 2021, from US $3.6 million in the prior-year period.

 

Net income increased 16.4% to US $3.4 million for Nine Months 2021, from US $2.9 million in the prior-year period.

 

Basic and diluted earnings per share were US $0.07 and US $0.06, respectively, for Nine Months 2021, compared to US $0.08 in the prior-year period.

 

Balance Sheet Highlights

 

As of September 30, 2021, Blue Hat had cash and cash equivalents of US $11.9 million, working capital of US $37.4 million and total shareholders’ equity of US $83.5 million, compared to cash and cash equivalents of US $15.8 million, working capital of US $34.0 million and total shareholders’ equity of US $58.9 million, respectively, at December 31, 2020.

 

About Blue Hat

 

Blue Hat is a leading communication services and IDC business provider as well as a producer, developer and operator of AR interactive entertainment games, toys and educational materials in China. Distinguished by its own proprietary technology, Blue Hat aims to create an engaging, interactive and immersive community for its users. For more information, please visit the Company’s investor relations website at http://ir.bluehatgroup.com. The Company routinely provides important information on its website.

 

4
 

 

 

 

Forward-Looking Statements

 

This 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. All forward-looking statements are inherently uncertain as they are based on current expectations and assumptions concerning future events or future performance of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. In evaluating such statements, prospective investors should review carefully various risks and uncertainties identified in this release and matters set in the Company’s SEC filings. These risks and uncertainties could cause the Company’s actual results to differ materially from those indicated in its forward-looking statements.

 

Contacts:

 

Blue Hat Interactive Entertainment Technology
Phone: +86 (592) 228-0010
Email: ir@bluehatgroup.net

 

Investor Relations:

 

The Equity Group Inc.       In China
Carolyne Sohn, Vice President       Lucy Ma, Associate
(415) 568-2255       +86 10 5661 7012
csohn@equityny.com       lma@equityny.com

 

5
 

 

 

 

BLUE HAT INTERACTIVE ENTERTAINMENT TECHNOLOGY AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

 

   For the Three Months Ended September 30,
   2021  2020
Revenues  $13,316,780   $3,967,824 
Cost of revenue   7,903,014    1,181,586 
Gross profit   5,413,766    2,786,238 
           
Operating expenses:          
Selling   1,432,284    120,574 
General and administrative   898,529    593,077 
Research and development   1,077,914    55,097 
Total operating expenses   3,408,727    768,748 
           
Income from operations   2,005,039    2,017,490 
           
Other income (expense)          
Interest income   16,770    38,937 
Interest expense   (28,026)   (31,615)
Other finance expenses   (3,109)   (5,227)
Other (expense) income, net   894,465    (41,628)
Total other (expense) income, net   870,100    (39,533)
           
Income before income taxes   2,875,139    1,977,957 
Provision for income taxes   859,354    319,285 
Net income   2,015,785    1,658,672 
           
Other comprehensive income (loss)          
Foreign currency translation adjustment   (315,989)   1,467,387 
Comprehensive income  $1,699,796   $3,126,059 
Less: Comprehensive income attributable to non-controlling interests   735,923     
Comprehensive income attributable to Blue Hat Interactive Entertainment shareholders   963,873    3,126,059 
           
Weighted average number of ordinary shares          
Basic   49,432,007    35,141,114 
Diluted   56,159,502    35,141,114 
           
Earnings per share          
Basic  $0.04   $0.05 
Diluted  $0.04   $0.05 

 

6
 

 

 

 

BLUE HAT INTERACTIVE ENTERTAINMENT TECHNOLOGY AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

 

   For the Nine Months Ended September 30,
   2021  2020
Revenues  $31,259,344   $8,822,686 
Cost of revenue   17,051,940    2,385,548 
Gross profit   14,207,404    6,437,138 
           
Operating expenses:          
Selling   3,081,032    411,273 
General and administrative   3,026,529    2,189,895 
Research and development   2,455,231    200,276 
Total operating expenses   8,562,792    2,801,444 
           
Income from operations   5,644,612    3,635,694 
           
Other income (expense)          
Interest income   151,655    146,821 
Interest expense   (263,427)   (155,275)
Other finance expenses   (84,772)   (15,395)
Other (expense) income, net   (198,101)   (20,766)
Total other (expense) income, net   (394,645)   (44,615)
           
Income before income taxes   5,249,967    3,591,079 
Provision for income taxes   1,853,066    672,644 
Net income   3,396,901    2,918,435 
           
Other comprehensive income (loss)          
Foreign currency translation adjustment   994,794    887,995 
Comprehensive income  $4,391,695   $3,806,430 
Less: Comprehensive income attributable to non-controlling interests   1,484,518      
Comprehensive income attributable to Blue Hat Interactive Entertainment shareholders   2,907,177    3,806,430 
           
Weighted average number of ordinary shares          
Basic   49,432,007    35,141,114 
Diluted   56,159,502    35,141,114 
           
Earnings per share          
Basic  $0.07   $0.08 
Diluted  $0.06   $0.08 

 

7
 

 

 

 

BLUE HAT INTERACTIVE ENTERTAINMENT TECHNOLOGY AND SUBSIDIARIES
UNAUDITED CONSOLIDATED BALANCE SHEETS

 

   September 30,  December 31,
ASSETS  2021  2020
Current assets:          
Cash and cash equivalents  $11,887,108   $15,800,563 
Restricted cash          
Short-term investments          
Accounts receivable, net   32,333,303    16,594,533 
Accounts receivable - related party        1,906,101 
Other receivables, net   16,225,702    14,350,223 
Other receivables - related party   33,381      
Inventories   244,302    117,075 
Prepayments, net   3,134,782    1,917,780 
Total current assets   63,858,858    50,686,275 
           
Property and equipment, net   4,232,119    4,258,121 
           
Other assets:          
Prepayments   11,784,577    4,164,274 
Operating lease, right-of-use asset   199,061    290,410 
Intangible assets, net   27,089,943    14,252,575 
Long-term investments   1,850,310    1,914,668 
Deferred tax assets   255,335    119,127 
Goodwill accounting   787,047      
Total other assets   41,966,273    20,741,054 
Total assets  $110,056,970   $75,685,450 
           
LIABILITIES AND SHAREHOLDERS’ EQUITY          
Current liabilities:          
Short-term loans - banks  $1,355,188   $5,129,295 
Current maturities of long-term loans - third party   0    14,117 
Accounts payable   3,813,233    935,588 
Convertible bonds payable   60,681    739,189 
Other payables and accrued liabilities   11,202,630    1,846,917 
Other payables - related party   216,885    25,837 
Operating lease liabilities - current   146,693    300,468 
Customer deposits   1,862,236    941,877 
Accrual interest payable          
Taxes payable   7,843,132    6,802,454 
Total current liabilities   26,500,678    16,735,742 
           
Other liabilities:          
Operating lease liability   59,731      
Long-term loans - third party          
Total other liabilities   59,731      
Total liabilities   26,560,409    16,735,742 
           
COMMITMENTS AND CONTINGENCIES          
Shareholders’ equity          
Ordinary shares, $0.001 par value, 100,000,000 shares
authorized, 53,417,200 shares issued and outstanding as of June
30, 2021, and 38,553,694 shares issued and outstanding as of December 31, 2020
   53,667    38,554 
Additional paid-in capital   35,861,782    23,466,482 
Statutory reserves   2,204,174    2,204,174 
Retained earnings   33,299,781    31,387,398 
Accumulated other comprehensive income (loss)   2,736,490    1,741,696 
Total Blue Hat Interactive Entertainment Technology shareholders’ equity   74,155,894    58,838,304 
Non-controlling interests   9,340,667    111,404 
Total equity   83,496,561    58,949,708 
Total liabilities and shareholders’ equity  $110,056,970   $75,685,450 

 

8