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SEC Filings

10-Q
SEVEN STARS CLOUD GROUP, INC. filed this Form 10-Q on 08/14/2017
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Income tax expenses

 

The income tax expense for the three months ended June 30, 2017 is nil because net operating loss carryovers offset current taxable income and deferred tax assets related to the net operating loss carryovers utilized had been offset by a valuation allowance.

 

Net loss attributable to non-controlling interest

 

Hua Cheng has a 20% non-controlling interest in Zhong Hai Media and as such we allocate 20% of the operating loss of Zhong Hai Media to Hua Cheng. During the three months ended June 30, 2017, approximately $0.1 million of our operating profit from Zhong Hai Media was allocated to Hua Cheng. For the three months ended June 30, 2016, operating loss attributable to non-controlling interest was approximately $0.02 million.

 

Dillon Yu has a 49% non-controlling interest in Shanghai Wecast Supply Chain Management Limited (“Wecast SH”) and as such we allocate 49% of the operating loss of Wecast SH to Dillon Yu. During the three months ended June 30, 2017, approximately $0.2 million of our operating loss from Wecast SH was allocated to Dillon Yu, which was nil in the same period in 2016.

 

Swiss Guorong Limited has a 45% non-controlling interest in Wide Angle and as such we allocate 45% of the operating profit of Wide Angle to Swiss Guorong Limited. During the three months ended June 30, 2017, approximately $0.01 million of our operating loss from Wide Angle was allocated to Swiss Guorong Limited, which was nil in the same period in 2016.

 

Comparison of Six Months Ended June 30, 2017 and 2016

 

   Six Months Ended         
   June 30, 2017   June 30, 2016   Amount Change   % Change 
Revenue  $76,488,790   $2,750,190   $73,738,600    2,681%
Cost of revenue   72,615,102    1,716,179    70,898,923    4,131%
Gross profit   3,873,688    1,034,011    2,839,677    275%
                     
Operating expense:                    
Selling, general and administrative expenses expenses   4,140,612    3,973,959    166,653    4%
Professional fees   1,014,551    637,937    376,614    59%
Impairment of other intangible assets   63,621    -    63,621    100%
Depreciation and amortization   257,153    220,806    36,347    16%
                     
Total operating expense   5,475,937    4,832,702    643,235    13%
                     
Loss from operations   (1,602,249)   (3,798,691)   2,196,442    (58%)
Interest expense, net   (45,253)   (200,183)   154,930    (77%)
Change in fair value of warrant liabilities   (243,999)   143,606    (387,605)   (270%)
Equity in loss of equity method investees   (76,836)   (37,349)   (39,487)   106%
Others   (110,642)   (5,096)   (105,546)   2071%
                     
Loss before income taxes   (2,078,979)   (3,897,713)   1,818,734    (47%)
                     
Income tax benefit   -    17,224    (17,224)   (100%)
                     
Net loss   (2,078,979)   (3,880,489)   1,801,510    (46%)
Net loss attributable to non-controlling interest   631,633    155,929    475,704    305%
                     
Net loss attributable to Seven Stars Cloud Group, Inc. shareholders  $(1,447,346)  $(3,724,560)  $2,277,214    (61%)

  

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