8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

______________

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): February 14, 2019

China HGS Real Estate, Inc.

(Exact Name of Registrant as Specified in Charter)

Florida	001-34864	33-0961490
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

6 Xinghan Road, 19^th Floor
Hanzhong City
Shaanxi Province, PRC 723000

(Address of Principal Executive Offices and Zip Code)

Registrant’s telephone number, including area code: (86) 091-62622612

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Item 2.02 Results of Operations and Financial Condition.

On February 14, 2019, China HGS Real Estate, Inc. issued a press release regarding its financial results for the three months ended December 31, 2018. A copy of the press release is filed herewith as Exhibit 99.1 to this Current Report and is incorporated herein by reference.

As provided in General Instruction B.2 of SEC Form 8-K, such information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and it shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or under the Exchange Act, whether made before or after the date hereof, except as expressly set forth by specific reference in such filing to this Current Report on Form 8-K.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.	Description
99.1	Press Release dated February 14, 2019

2

SIGNATURE

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 hereunto duly authorized.

Dated: February 14, 2019	China HGS Real Estate, Inc.
	By:	/s/Xiaojun Zhu
		Name: Xiaojun Zhu
		Title: Chief Executive Officer and Chairman

EX-99.1

Exhibit 99.1

China HGS Reports First Quarter of Fiscal Year 2019 Results

HANZHONG, CHINA – February 14 2019 – China HGS Real Estate Inc. (NASDAQ: HGSH) (“China HGS” or the “Company”), a leading regional real estate developer headquartered in Hanzhong City, Shaanxi Province, China, today reported its financial results for the first quarter of fiscal 2019 ended December 31, 2018 with the U.S. Securities and Exchange Commission. An electronic copy of the quarterly report on Form 10-Q can be accessed on the SEC's website at www.sec.gov

Highlights for the quarter

l Total revenues for the first quarter of fiscal 2019 were approximately $7.7 million, a decrease of 46.4% from approximately $14.4 million in the same quarter of fiscal 2018 due to less gross floor area sold during the current quarter.

l Net income for the first quarter of fiscal 2019 totaled approximately $0.5 million, a decrease of approximately 59.8% from the net income of approximately $1.2 million in the same period of last year.

l Basic and diluted net earnings per share (“EPS”) attributable to shareholders for the first quarter of fiscal 2019 were $0.01, compared to $0.03 for the same quarter of the last year.

Safe Harbor Statement

This press release contains forward-looking statements, which are subject to change. The forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All "forward-looking statements" relating to the business of China HGS Real Estate Inc., which can be identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties which could cause actual results to differ. These factors include but are not limited to: the uncertain market for the Company's business, macroeconomic, technological, regulatory, or other factors affecting the profitability of real estate business; and other risks related to the Company's business and risks related to operating in China. Please refer to the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2018, for specific details on risk factors. Given these risks and uncertainties, you are cautioned not to place undue reliance on forward-looking statements. The Company's actual results could differ materially from those contained in the forward-looking statements. The Company undertakes no obligation to revise or update its forward-looking statements in order to reflect events or circumstances that may arise after the date of this release.

About China HGS Real Estate, Inc.

China HGS Real Estate, Inc. (NASDAQ: HGSH), founded in 1995 and headquartered in Hanzhong City, Shaanxi Province, is a leading real estate developer in the region and holds the national grade I real estate qualification. The Company focuses on the development of high-rise, sub-high-rise residential buildings and multi-building apartment complexes in China's Tier 3 and Tier 4 cities and counties with rapidly growing populations driven by increased urbanization. The Company provides affordable housing with popular and modern designs to meet the needs of multiple buyer groups. The Company’s development activity spans a range of services, including land acquisition, project planning, design management, construction management, sales and marketing, and property management. For further information about China HGS, please go to www.chinahgs.com. 

Company contact:

Randy Xiong, President of Capital Market
China Phone: (86) 091-62622612

Email: randy.xiong@chinahgs.com

CHINA HGS REAL ESTATE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	December 31,			September 30,
	2018			2018
ASSETS
Current assets:
Cash	$	1,020,954		$	3,267,020
Restricted cash		3,765,220			3,508,557
Contract receivables		10,933,593			12,582,965
Real estate property development completed		58,359,777			58,999,178
Real estate property under development		57,211,691			60,128,554
Other current assets		1,567,545			1,408,826
Total current assets		132,858,780			139,895,100
Property, plant and equipment, net		697,603			718,366
Real estate property development completed, net of current portion		1,216,321			1,217,650
Security deposits		8,287,732			8,296,782
Real estate property under development, net of current portion		215,610,918			215,431,915
Due from local government for real estate property development completed		2,833,771			2,836,865
Total Assets	$	361,505,125		$	368,396,678
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Construction loans	$	72,028,216		$	55,610,803
Accounts payables		20,394,271			20,507,128
Other payables		5,026,946			4,894,774
Construction deposits		1,877,520			1,879,570
Contract liabilities		6,202,762			5,844,189
Customer deposits		18,359,022			20,234,072
Shareholder loans		2,141,748			2,142,110
Accrued expenses		2,923,409			3,006,150
Taxes  payable		14,656,593			15,492,902
Total current liabilities		143,610,487			129,611,698
Deferred tax liabilities		2,235,352			2,068,257
Tax payable - long term		4,955,367			4,960,779
Customer deposits, net of current portion		1,912,588			1,914,677
Construction loans, less current portion		45,531,384			66,885,378
Construction deposits, net of current portion		1,276,659			1,278,053
Total liabilities		199,521,837			206,718,842
Commitments and Contingencies
Stockholders' equity
Common stock, $0.001 par value, 100,000,000 shares authorized, 45,050,000 shares issued and outstanding December 31, 2018 and September 30, 2018		45,050			45,050
Additional paid-in capital		129,907,805			129,907,805
Statutory surplus		9,925,794			9,925,794
Retained earnings		31,287,262			30,803,052
Accumulated other comprehensive deficit		(9,182,623	)		(9,003,865	)
Total stockholders' equity		161,983,288			161,677,836
Total Liabilities and Stockholders' Equity	$	361,505,125		$	368,396,678

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CHINA HGS REAL ESTATE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(Unaudited)

	Three months ended December 31,
	2018			2017
Real estate sales	$	7,737,196		$	14,447,571
Less: Sales tax		(142,111	)		(25,216	)
Cost of real estate sales		(5,923,184	)		(12,000,541	)
Gross profit		1,671,901			2,421,814
Operating expenses
Selling and distribution expenses		169,974			316,742
General and administrative expenses		470,932			357,429
Total operating expenses		640,906			674,171
Operating income		1,030,995			1,747,643
Interest expense, net		(105,231	)		(128,621	)
Other expense		(273,153	)		-
Income before income taxes		652,611			1,619,022
Provision for income taxes		168,401			413,750
Net income		484,210			1,205,272
Other Comprehensive income
Foreign currency translation adjustment		(178,758	)		3,729,087
Comprehensive income	$	305,452		$	4,934,359
Basic and diluted income per common share
Basic and diluted	$	0.01		$	0.03
Weighted average common shares outstanding
Basic and diluted		45,050,000			45,050,000

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CHINA HGS REAL ESTATE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three months ended December 31,
	2018			2017
Cash flows from operating activities
Net income	$	484,210		$	1,205,272
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred tax provision		168,401			145,714
Depreciation		19,869			412,078
Stock based compensation		-			14,900
Changes in assets and liabilities:
Contract receivables		1,626,468			(850,656	)
Real estate property development completed		571,816			5,976,747
Real estate property under development		2,423,593			(4,361,705	)
Other current assets		(159,357	)		236,266
Accounts payables		(89,978	)		(1,719,070	)
Other payables		136,739			237,946
Contract liabilities		362,900			429,205
Customer deposits		(1,842,581	)		492,982
Construction deposits		-			(6,230	)
Accrued expenses		(79,484	)		(86,445	)
Taxes payable		(552,602	)		(61,119	)
Net cash provided by operating activities		3,069,994			2,065,885
Cash flow from investing activities
Purchases of fixed assets		-			(390,392	)
Net cash used in investing activities		-			(390,392	)
Cash flow from financing activities
Net proceeds (repayments) of shareholder loans		485,552			(122,484	)
Repayments of bank loans		(5,261,559	)		(863,438	)
Net cash used in financing activities		(4,776,007	)		(985,922	)
Effect of changes of foreign exchange rate on cash and restricted cash		(283,390	)		117,885
Net increase (decrease) in cash and restricted cash		(1,989,403	)		807,456
Cash and restricted cash , beginning of period		6,775,577			4,716,604
Cash and restricted cash, end of period	$	4,786,174		$	5,524,060
Supplemental disclosures of cash flow information:
Interest paid	$	1,786,958		$	1,481,263
Income taxes paid	$	102,591		$	98,906
Reconciliation to amounts on condensed consolidated balance sheets:
Cash	$	1,020,954		$	2,694,175
Restricted	$	3,765,220		$	2,829,885
Total cash and restricted cash	$	4,786,174		$	5,524,060

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.