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 2022
Commission File Number: 001-40580
Sentage Holdings Inc.
501, Platinum Tower, 233 Taicang Rd., Huangpu,
Shanghai City, the PRC
(Address of principal executive offices)
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): ☐
Explanatory Note
On December 9, 2022, Sentage Holdings Inc. (the “Company”) reported its financial results for the six months ended June 30, 2022. The Company hereby furnishes the following document as exhibit to this report: “Press Release”.
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EXHIBIT INDEX
| Exhibit No. | Description | |
| 99.1 | Press Release |
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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.
Dated: December 9, 2022
| Sentage Holdings Inc. | ||
| By: | /s/ Qiaoling Lu | |
| Name: | Qiaoling Lu | |
| Title: | Chief Executive Officer | |
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Exhibit 99.1
Sentage Holdings Inc. Announces Financial Results for the First Six Months of Fiscal Year 2022
Shanghai, China, December 9, 2022 (GLOBE NEWSWIRE) -- Sentage Holdings Inc. (the “Company”, “we”, “our”) (Nasdaq: SNTG), is a holding company incorporated in the Cayman Islands with no material operations of its own. Through its China-based operating entities, the Company offers a comprehensive range of financial services across consumer loan repayment and collection management, loan recommendation, and prepaid payment network services in China. The Company today announced its financial results for the first six months of fiscal year 2022 ended June 30, 2022. The following summarizes such financial results.
Financial Highlights for the First Six Months of Fiscal Year 2022
| ● | Total operating revenue was $0.18 million in the six months ended June 30, 2022, compared with $1.32 million for the same period of last year, representing a 87.0% decrease, primarily due to the fact that in the first half of 2022: (1) the outstanding servicing agreements under the consumer loan repayment and collection management business were fully completed in fiscal 2021 and did not generate any revenue, and (2) the loan recommendation business did not generate any revenue because Chinese financial institutions limited loan approvals to loan applicants as a result of the Chinese government’s recent measures to rein in the overheated property market. |
| ● | Net loss was $0.96 million in the six months ended June 30, 2022, compared with net income of $0.45 million for the same period of last year. |
| ● | Basic and diluted loss per share was $0.41 in the six months ended June 30, 2022, compared with basic and diluted earnings per share of $0.22 for the same period of last year. |
CCOVID-19 Impact
Our business operations have been negatively affected by the ongoing COVID-19 pandemic for fiscal year 2021 and for the six months ended June 30, 2022, and the continued uncertainties associated with the COVID-19 pandemic may negatively impact our future revenue and cash flows. A COVID-19 resurgence may again give rise to economic downturns and other significant changes in regional and global economic conditions, which could have an adverse impact on the real estate market in the Shanghai area and other first-tier cities we target, decreasing the total loan amount borrowers are able to obtain through our services, reducing our service fees, which, in each instance, is based on the specific loan amount, and adversely impacting our revenue from the loan recommendation business. In addition, borrowers’ default and delinquency risks might increase as they experience unemployment or a reduction in income. Higher default and delinquency risks may increase our operating costs and require us to dedicate more resources to maintain our current collection rate for the loan repayment and collection management business, and may pose risk- management challenges for our loan recommendation business. The extent of the future impact of COVID-19 is still uncertain and cannot be accurately predicted at this time.
Financial Results for the First Six Months of Fiscal Year 2022
Operating Revenue
Total operating revenue decreased by $1.14 million, or 87.0%, to $0.18 million in the six months ended June 30, 2022, from $1.32 million for the same period of last year, primarily due to the fact that the outstanding servicing agreements under the consumer loan repayment and collection management business were fully completed in fiscal 2021 and did not generate revenue in the first half of 2022.
Loan Repayment and Collection Management Business
Revenue from the consumer loan repayment and collection management business decreased to nil for the six months ended June 30, 2022, from $0.75 million for the same period of last year, primarily due to the fact that outstanding service agreements were fully completed in fiscal 2021. The Company plans to continue its consumer loan repayment and collection management business by expanding its client base and collaborating with third-party financial institutions.
Loan Recommendation Business
Revenue from the loan recommendation services business decreased to nil for the six months ended June 30, 2021 from $120,000 for the same period last year. The main reason for the decrease was largely influenced by the Chinese government’s recent tightening measures to rein in the overheated real property market, which led Chinese financial institutions to limit loan approvals. The total number of borrowers decreased from 31 for the six months ended 30 June 2021 to 0 for the six months ended 30 June 2022.
Prepaid Payment Network Service Business
Revenue from the prepaid payment network services business decreased by $0.15 million, or 45.9%, to $0.18 million, in the six months ended June 30, 2022, from $0.33 million for the same period of last year. The total number of the merchant customers who used the Company’s prepaid payment network services was 8 in each of the six months ended June 30, 2022 and 2021. During the six months ended June 30, 2022 and 2021, the Company successfully provided technology consulting and support services to these customers. The Company charged such merchant customers service fees for designing tailored payment solutions, interfacing their internal systems with our prepaid card payment system, and providing their staff with relevant operation training. During the six months ended June 30, 2022, the Company issued prepaid cards in the amount of $32,766 to its customers.
Operating Expenses
Selling, general and administrative expenses increased by $412,818, or 57.3%, to $1,133,062 in the six months ended June 30, 2022, from $720,244 for the same period of last year. The increase was due to the following combination of reasons:
| ● | Consulting and professional expenses increased by $ 389,006, or 116% to $ 723,556 in the six months ended June 30, 2022, from $334,550 for the same period of last year. The increase was primarily due to the Company paid a higher amount of consulting services to third party professionals for business strategy and planning purposes. In addition, the company paid audit and legal services fees to the third-party providers for the preparation of the annual report filed with the U.S. Securities and Exchange Commission as a publicly listed company. |
Provision for Income Taxes
Provision for income taxes decreased to nil for the six months ended 30 June 2022 from $0.15 million for the same period last year, due to the decrease in taxable income.
Net Income/(Loss)
Net loss was $0.96 million in the six months ended June 30, 2022, compared with net income of $0.45 million for the same period of last year.
Earnings(loss) Per Share
Basic and diluted loss per share was $0.41 in the six months ended June 30, 2022, compared with basic and diluted earnings per share of $0.22 for the same period of last year.
Cash and Cash Equivalents
As of June 30, 2022, the Company had cash and restricted cash of $8.95 million, compared with $10.75 million as of December 31, 2021.
Cash Flow
Net cash used in operating activities was $1.70 million in the six months ended June 30, 2022, compared with $0.87 million for the same period of last year.
Net cash used in investing activities was $7,874, compared $644 for the same period of last year.
Net cash used in financing activities was $0.04 million, compared with $0.91 million for the same period of last year.
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About Sentage Holdings Inc.
Sentage Holdings Inc., headquartered in Shanghai, China, is a holding company incorporated in the Cayman Islands with no material operations of its own (the “Company”). Through its China-based operating entities, the Company offers a comprehensive range of financial services across consumer loan repayment and collection management, loan recommendation, and prepaid payment network services in China. Leveraging a deep understanding of its client base, strategic partner relationships, and proprietary valuation models and technologies, the Company is committed to working with its clients to understand their financial needs and challenges and offering customized services to help them meet their respective objectives. For more information, please visit the company’s website at ir.sentageholdings.com.
Forward-Looking Statement
Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations and projections about future events and financial trends that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or other similar expressions. 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 the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review risk factors that may affect its future results in the Company’s registration statement.
For more information, please contact:
Sentage Holdings Inc.
Investor Relations Department
Email: ir@sentageholdings.com
Ascent Investor Relations LLC
Tina Xiao President
Tel: +1 917-609-0333
Email: tina.xiao@ascent-ir.com
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SENTAGE HOLDINGS INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
| As of | ||||||||
| June 30 | December 31 | |||||||
| 2022 | 2021 | |||||||
| USD | USD | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash | $ | 8,953,505 | $ | 10,753,118 | ||||
| Restricted cash | 23,431 | 30,269 | ||||||
| Loan receivable | 5,500,000 | 5,500,000 | ||||||
| Accounts receivable, net | 554,865 | 403,708 | ||||||
| Prepaid expenses and other current assets | 1,138,382 | 515,062 | ||||||
| Total current assets | 16,170,183 | 17,202,157 | ||||||
| Non-current assets | ||||||||
| Property and equipment, net | 119,311 | 120,280 | ||||||
| Intangible assets, net | 17,643 | 30,547 | ||||||
| Deferred tax assets | 13,038 | 13,724 | ||||||
| Total non-current assets | 149,992 | 164,551 | ||||||
| Total assets | $ | 16,320,175 | $ | 17,366,708 | ||||
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SENTAGE HOLDINGS INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (Continued)
| As of | ||||||||
| June 30 | December 31 | |||||||
| 2022 | 2021 | |||||||
| USD | USD | |||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 6,957 | $ | 2,743 | ||||
| Accrued expenses and other current liabilities | 387,911 | 379,991 | ||||||
| Total current liabilities | 394,868 | 382,734 | ||||||
| Non-current liability | ||||||||
| Due to a related party, non-current | 117,028 | 161,020 | ||||||
| Total non-current liability | 117,028 | 161,020 | ||||||
| Total liabilities | 511,896 | 543,754 | ||||||
| Shareholders’ equity | ||||||||
| Ordinary shares, $0.005 par value, 10,000,000 shares authorized, 2,800,000 shared issued and outstanding | 2,800 | 2,800 | ||||||
| Additional paid in capital | 55,339,085 | 55,339,085 | ||||||
| Statutory reserves | 159,591 | 166,038 | ||||||
| Accumulated deficit | (39,861,485 | ) | (38,898,664 | ) | ||||
| Accumulated other comprehensive income | 168,288 | 213,695 | ||||||
| Total shareholders’ equity | 15,808,279 | 16,822,954 | ||||||
| Total liabilities and shareholders’ equity | $ | 16,320,175 | $ | 17,366,708 | ||||
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SENTAGE HOLDINGS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
| For the six months ended June 30, | ||||||||
| 2022 | 2021 | |||||||
| OPERATING REVENUE | ||||||||
| Consumer loan repayment and collection management service fees | $ | - | $ | 117,287 | ||||
| Loan recommendation service fees | - | 872,201 | ||||||
| Prepaid payment network service fee | 177,489 | 328,195 | ||||||
| Total operating revenue | 177,489 | 1,317,683 | ||||||
| OPERATING EXPENSE | ||||||||
| Selling, general and administrative expenses | 1,133,062 | 720,244 | ||||||
| Total operating expenses | 1,133,062 | 720,244 | ||||||
| (LOSS)INCOME FROM OPERATIONS | (955,573 | ) | 597,439 | |||||
| OTHER EXPENSES | (7,248 | ) | (304 | ) | ||||
| (LOSS)INCOME BEFORE INCOME TAX PROVISION | (962,821 | ) | 597,135 | |||||
| PROVISION FOR INCOME TAXES | - | 151,954 | ||||||
| NET (LOSS)INCOME | (962,821 | ) | 445,181 | |||||
| OTHER COMPREHENSIVE (LOSS)/INCOME | ||||||||
| Foreign currency translation adjustment | (45,407 | ) | (38,586 | ) | ||||
| COMPREHENSIVE (LOSS)/INCOME | $ | (1,008,228 | ) | $ | 406,595 | |||
| (Loss/)earnings per common share- basic and diluted | $ | (0.41 | ) | $ | 0.22 | |||
| Weighted average shares- basic and diluted | 2,374,795 | 2,000,000 | ||||||
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SENTAGE HOLDINGS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
| For the six months ended June 30, | ||||||||
| 2022 | 2021 | |||||||
| Cash flows from operating activities | ||||||||
| Net (loss) income | $ | (962,821 | ) | $ | 445,181 | |||
| Adjustments to reconcile net income to cash and restricted cash provided by (used in) operating activities: | ||||||||
| Depreciation and amortization | 21,747 | 25,316 | ||||||
| Deferred income tax expense | 686 | 51,956 | ||||||
| Impairment loss recognised in respect of receivables | 52,150 | - | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | (203,307 | ) | (42,536 | ) | ||||
| Prepaid expenses and other current assets | (623,320 | ) | 265,424 | |||||
| Accounts payable | - | (2,256 | ) | |||||
| Deferred revenue | - | (117,287 | ) | |||||
| Accrued expenses and other current liabilities | 12,134 | 248,446 | ||||||
| Net cash (used in)/provided by used in operating activities | (1,702,731 | ) | 874,244 | |||||
| Cash flows from investing activities | ||||||||
| Cash acquired from newly established VIE entity- Zhenyi | - | 644 | ||||||
| Additions to Property and equipment, net | (7,874 | ) | - | |||||
| Net cash (used in)/provided by investing activities | (7,874 | ) | 644 | |||||
| Cash flows from financing activities | ||||||||
| Deferred initial public offering costs | - | (220,422 | ) | |||||
| Repayment to related party loans | (43,992 | ) | (693,268 | ) | ||||
| Net cash used in financing activities | (43,992 | ) | (913,690 | ) | ||||
| Reconciliation of cash and restricted cash, beginning of period | ||||||||
| Cash | 117,434 | 117,434 | ||||||
| Restricted cash | 22,948 | 22,948 | ||||||
| Cash and restricted cash, beginning of period | $ | 140,382 | $ | 140,382 | ||||
| Reconciliation of cash and restricted cash, end of period | ||||||||
| Cash | 8,953,505 | 77,710 | ||||||
| Restricted cash | 23,431 | 25,424 | ||||||
| Cash and restricted cash, end of period | $ | 8,976,936 | $ | 103,134 | ||||
| Effect of exchange rate changes on cash and restricted cash | (51,854 | ) | 1,554 | |||||
| Net decrease in cash and restricted cash | (1,806,451 | ) | (37,248 | ) | ||||
| Cash and restricted cash, beginning of period | 10,783,387 | 140,382 | ||||||
| Cash and restricted cash, end of period | $ | 8,976,936 | $ | 103,134 | ||||
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