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^[1] “歸屬于華欽科技股東的Non-GAAP凈利潤”是一種Non-GAAP財務(wù)指標(biāo)，其定義為歸屬于公司的不包括股份補(bǔ)償費(fèi)用的凈利潤，詳細(xì)信息請參閱“Reconciliation of Non-GAAP and GAAP Results”。

^[2] “Non-GAAP管理費(fèi)用”是一種Non-GAAP財務(wù)指標(biāo)，其定義為不包括股份補(bǔ)償費(fèi)用的管理費(fèi)用，詳細(xì)信息請參閱“Reconciliation of Non-GAAP and GAAP Results”。

^[3] “Non-GAAP凈利潤”是一種Non-GAAP的財務(wù)指標(biāo)，其定義為不包括股份補(bǔ)償費(fèi)用的凈利潤，詳細(xì)信息請參閱“Reconciliation of Non-GAAP and GAAP Results”。

CLPS INCORPORATION

CONSOLIDATED BALANCE SHEETS

 (Amounts in U.S. dollars ("$"), except for number of shares)

As of June 30,

As of December
31,

2021

(Audited)

2020

(Unaudited)

ASSETS

Current assets:

Cash and cash equivalents

$

24,739,382

$

25,981,167

Short-term investments

4,158,535

-

Accounts receivable, net

44,138,997

31,205,299

Prepayments, deposits and other assets, net

2,530,458

1,545,239

Prepaid income tax

-

884,720

Amounts due from related parties

546,128

-

Total Current Assets

76,113,500

59,616,425

Non-Current assets:

Property and equipment, net

600,791

585,079

Intangible assets, net

1,050,499

1,202,449

Goodwill

2,444,950

2,234,615

Long-term investments

1,014,784

900,091

Prepayments, deposits and other assets, net

896,145

537,063

Deferred tax assets, net

607,773

448,154

Total Assets

$

82,728,442

$

65,523,876

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Bank loans  

$

7,536,839

$

5,005,402

Accounts payable

559,450

535,055

Accrued expenses and other current liabilities

245,408

238,456

Tax payables

1,715,009

1,626,017

Contract liabilities

326,912

868,222

Salaries and benefits payable

12,466,921

19,472,224

Amounts due to related party  

183,148

67,918

Total Current Liabilities

23,033,687

27,813,294

Non-Current liabilities:

Bank loans

9,644

16,925

Deferred tax liabilities

155,033

143,846

Other non-current liabilities

1,799,383

311,923

 TOTAL LIABILITIES

24,997,747

28,285,988

Commitments and Contingencies

Shareholders' Equity

Common stock, $0.0001 par value, 100,000,000 shares authorized;
    20,293,552 shares issued and outstanding as of June 30, 2021;
   16,345,053 shares issued and outstanding as of December 31,2020

2,029

1,635

Additional paid-in capital

48,516,695

30,081,334

Statutory reserves

4,214,075

2,954,993

Retained earnings

2,726,165

2,028,791

Accumulated other comprehensive income

1,230,083

770,144

Total CLPS Incorporation Shareholders' Equity

56,689,047

35,836,897

Noncontrolling Interests

1,041,648

1,400,991

Total Shareholders' Equity

57,730,695

37,237,888

Total Liabilities and Shareholders' Equity

$

82,728,442

$

65,523,876

CLPS INCORPORATION

UNAUDITED CONSOLIDATED statements of INCOME AND COMPREHENSIVE INCOME

(Amounts in U.S. dollars ("$"), except for number of shares)

For the six months ended

June 30,

2021

2020

Revenues

$

67,743,485

$

46,847,534

Less: Cost of revenues (note 1)

(46,050,474)

(31,104,457)

Gross profit

21,693,011

15,743,077

Operating income (expenses):

Selling and marketing expenses (note 1)

(1,959,429)

(1,655,650)

Research and development expenses

(7,176,725)

(5,416,455)

General and administrative expenses (note 1)

(10,155,688)

(8,446,840)

Subsidies and other operating income

1,041,167

440,533

Total operating expenses

(18,250,675)

(15,078,412)

Income from operations

3,442,336

664,665

Other income   

149,323

535,927

Other expenses

(301,821)

(77,229)

Income before income tax and share of income (loss) in  
  equity investees

3,289,838

1,123,363

Provision for income taxes

1,164,910

446,601

Income before share of income (loss) in equity investees

2,124,928

676,762

Share of (loss) income in equity investees, net of tax

(37,994)

107,895

Net income

2,086,934

784,657

Less: Net income attributable to noncontrolling interests

130,478

215,359

Net income attributable to CLPS Incorporation's
    shareholders

$

1,956,456

$

569,298

Other comprehensive income (loss)

Foreign currency translation income (loss)

$

468,792

$

(432,198)

Less: foreign currency translation income (loss) attributable
   to noncontrolling interest

8,853

(30,277)

Other comprehensive income (loss) attributable to CLPS
   Incorporation's shareholders

$

459,939

$

(401,921)

Comprehensive income attributable to

CLPS Incorporation's shareholders

$

2,416,395

$

167,377

Comprehensive income attributable to noncontrolling interests

139,331

184,562

Comprehensive income

$

2,555,726

$

351,939

Basic earnings per common share

$

0.11

$

0.04

Weighted average number of share outstanding – basic

18,514,807

15,169,655

Diluted earnings per common share

$

0.10

$

0.04

Weighted average number of share outstanding – diluted

19,097,170

15,212,010

Note:

(1)    Includes share-based compensation expenses as follows:
        Cost of revenues

4,221

9,042

Selling and marketing expenses

42,556

181,257

General and administrative expenses

3,586,593

2,747,132

CLPS INCORPORATION

RECONCILIATION OF NON-GAAP AND GAAP RESULTS

(Amounts in U.S. dollars ("$"), except for number of shares)

For the six months ended 

June 30,

2021

2020

(Unaudited)

(Unaudited)

Cost of revenues

$

(46,050,474)

$

(31,104,457)

Less: share-based compensation expenses

(4,221)

(9,042)

Non-GAAP cost of revenues

$

(46,046,253)

$

(31,095,415)

Selling and marketing expenses

$

(1,959,429)

$

(1,655,650)

Less: share-based compensation expenses

(42,556)

(181,257)

Non-GAAP selling and marketing expenses

$

(1,916,873)

$

(1,474,393)

General and administrative expenses

$

(10,155,688)

$

(8,446,840)

Less: share-based compensation expenses

(3,586,593)

(2,747,132)

Non-GAAP general and administrative expenses

$

(6,569,095)

$

(5,699,708)

Operating income

$

3,442,336

$

664,665

Add: share-based compensation expenses

3,633,370

2,937,431

Non-GAAP operating income

$

7,075,706

$

3,602,096

Operating margin

5.1%

1.4%

Add: share-based compensation expenses

5.3%

6.3%

Non-GAAP operating margin

10.4%

7.7%

Net income

$

2,086,934

$

784,657

Add: share-based compensation expenses

3,633,370

2,937,431

Non-GAAP net income

$

5,720,304

$

3,722,088

Net income attributable to CLPS Incorporation's
shareholders

$

1,956,456

$

569,298

Add: share-based compensation expenses

3,633,370

2,937,431

Non-GAAP net income attributable to CLPS
Incorporation's shareholders

5,589,826

3,506,729

$

$

Weighted average number of share outstanding used
in computing GAAP and non-GAAP basic earnings

18,514,807

15,169,655

GAAP basic earnings per common share

$

0.11

$

0.04

Add: share-based compensation expenses

0.19

0.19

Non-GAAP basic earnings per common share

$

0.30

$

0.23

Weighted average number of share outstanding used
in computing GAAP diluted earnings

19,097,170

15,212,010

Weighted average number of share outstanding used
in computing non-GAAP diluted earnings

19,097,170

15,212,010

GAAP diluted earnings per common share

$

0.10

$

0.04

Add: share-based compensation expenses

0.19

0.19

Non-GAAP diluted earnings per common share

$

0.29

$

0.23

CLPS INCORPORATION

AUDITED CONSOLIDATED BALANCE SHEETS

 (Amounts in U.S. dollars ("$"), except for number of shares)

As of June 30,

2021

2020

ASSETS

Current assets:

Cash and cash equivalents

$

24,739,382

$

12,652,120

Short-term investments

4,158,535

636,934

Accounts receivable, net

44,138,997

25,753,856

Prepayments, deposits and other assets, net

2,530,458

1,280,967

Prepaid income tax

-

15,780

Amounts due from related parties

546,128

169,185

Total Current Assets

76,113,500

40,508,842

Non-current assets:

Property and equipment, net

600,791

452,472

Intangible assets, net

1,050,499

1,144,579

Goodwill

2,444,950

2,118,700

Long-term investments

1,014,784

680,131

Prepayments, deposits and other assets, net

896,145

244,387

Deferred tax assets, net

607,773

203,247

Total Assets

$

82,728,442

$

45,352,358

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities

Bank loans

$

7,536,839

$

2,161,239

Accounts payable

559,450

268,661

Accrued expenses and other current liabilities

245,408

220,382

Tax payables

1,715,009

1,426,614

Contract liabilities

326,912

755,178

Salaries and benefits payable

12,466,921

11,522,268

Amounts due to related party

183,148

-

Total Current Liabilities

23,033,687

16,354,342

Non-current liabilities

Bank loans

9,644

22,554

Deferred tax liabilities

155,033

163,163

Other non-current liabilities

1,799,383

194,939

 TOTAL LIABILITIES

24,997,747

16,734,998

Commitments and Contingencies

Shareholders' Equity

Common stock, $0.0001 par value, 100,000,000 shares authorized;

   20,293,552 shares issued and outstanding as of June 30, 2021;
   15,930,330 shares issued and outstanding as of June 30, 2020

2,029

1,593

Additional paid-in capital

48,516,695

28,586,048

Statutory reserves

4,214,075

2,803,811

Retained earnings (Accumulated deficits)

2,726,165

（2,680,143)

Accumulated other comprehensive income (loss)

1,230,083

Total CLPS Incorporation's Shareholders' Equity

56,689,047

27,348,644

Noncontrolling Interests

1,041,648

1,268,716

Total Shareholders' Equity

57,730,695

28,617,360

Total Liabilities and Shareholders' Equity

$

82,728,442

$

45,352,358

CLPS INCORPORATION

AUDITED CONSOLIDATED statements of INCOME AND COMPREHENSIVE INCOME

(Amounts in U.S. dollars ("$"), except for number of shares)

For the years ended

June 30,

2021

2020

Revenues

$

126,061,693

$

89,415,798

Less: Cost of revenues (note 1)

(85,890,757)

(58,296,097)

Gross profit

40,170,936

31,119,701

Operating income (expenses):

Selling and marketing expenses (note 1)

(3,753,236)

(3,059,877)

Research and development expenses

(13,337,913)

(10,436,975)

General and administrative expenses (note 1)

(16,784,688)

(16,343,936)

Subsidies and other operating income

2,080,087

1,927,230

Total operating expenses

(31,795,750)

(27,913,558)

Income from operations

8,375,186

3,206,143

Other income

296,319

608,638

Other expenses

(351,045)

(107,322)

Income before income tax and share of income (loss) in equity
   investees

8,320,460

3,707,459

Provision for income taxes

1,257,124

835,444

Income before share of income (loss) in equity investees

7,063,336

2,872,015

Share of (loss) income in equity investees, net of tax

(44,121)

207,363

Net income

7,019,215

3,079,378

Less: Net income attributable to noncontrolling interests

202,643

141,139

Net income attributable to CLPS Incorporation's
    shareholders

$

6,816,572

$

2,938,239

Other comprehensive income (loss)

Foreign currency translation income (loss)

$

2,695,223

$

(571,943)

Less: foreign currency translation income (loss) attributable
   to noncontrolling interests

102,475

(22,928)

Other comprehensive income (loss) attributable to CLPS
   Incorporation's shareholders

$

2,592,748

$

(549,015)

Comprehensive income attributable to

   CLPS Incorporation's shareholders

$

9,409,320

$

2,389,224

Comprehensive income attributable to noncontrolling interests

305,118

118,211

Comprehensive income

$

9,714,438

$

2,507,435

Basic earnings per common share

$

0.39

$

0.20

Weighted average number of share outstanding – basic

17,279,443

14,689,224

Diluted earnings per common share

$

0.39

$

0.20

Weighted average number of share outstanding – diluted

17,569,440

14,692,299

Note:

(1)   Includes share-based compensation expenses as follows:
      Cost of revenues

8,403

14,110

Selling and marketing expenses

122,087

211,573

General and administrative expenses

4,998,206

3,778,397

CLPS INCORPORATION

RECONCILIATION OF NON-GAAP AND GAAP RESULTS

(Amounts in U.S. dollars ("$"), except for number of shares)

For the years ended 

June 30,

2021

2020

Cost of revenues

$

(85,890,757)

$

(58,296,097)

Less: share-based compensation expenses

(8,403)

(14,110)

Non-GAAP cost of revenues

$

(85,882,354)

$

(58,281,987)

Selling and marketing expenses

$

(3,753,236)

$

(3,059,877)

Less: share-based compensation expenses

(122,087)

(211,573)

Non-GAAP selling and marketing expenses

$

(3,631,149)

$

(2,848,304)

General and administrative expenses

$

(16,784,688)

$

(16,343,936)

Less: share-based compensation expenses

(4,998,206)

(3,778,397)

Non-GAAP general and administrative expenses

$

(11,786,482)

$

(12,565,539)

Operating income

$

8,375,186

$

3,206,143

Add: share-based compensation expenses

5,128,696

4,004,080

Non-GAAP operating income

$

13,503,882

$

7,210,223

Operating Margin

6.6%

3.6%

Add: share-based compensation expenses

4.1%

4.5%

Non-GAAP operating margin

10.7%

8.1%

Net income

$

7,019,215

$

3,079,378

Add: share-based compensation expenses

5,128,696

4,004,080

Non-GAAP net income

$

12,147,911

$

7,083,458

Net income attributable to CLPS Incorporation's
shareholders

$

6,816,572

$

2,938,239

Add: share-based compensation expenses

5,128,696

4,004,080

Non-GAAP net income attributable to CLPS
Incorporation's shareholders

$

11,945,268

$

6,942,319

Weighted average number of share outstanding used
in computing GAAP and non-GAAP basic earnings

17,279,443

14,689,224

GAAP basic earnings per common share

$

0.39

$

0.20

Add: share-based compensation expenses

0.30

0.27

Non-GAAP basic earnings per common share

$

0.69

$

0.47

Weighted average number of share outstanding used
in computing GAAP diluted earnings

17,569,440

14,692,299

Weighted average number of share outstanding used
in computing non-GAAP diluted earnings

17,569,440

14,692,299

GAAP diluted earnings per common share

$

0.39

$

0.20

Add: share-based compensation expenses

0.29

0.27

Non-GAAP diluted earnings per common share

$

0.68

$

0.47