HANGZHOU, China, Aug. 9, 2016 /PRNewswire/ -- 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 third quarter of fiscal 2016 ended
June 30, 2016 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
- Total revenues for the third quarter of fiscal 2016 were
approximately $12.5 million, a
decrease of 52.0% from approximately $26.0
million in the same quarter of fiscal 2015. Total revenues
recognized from percentage of completion method were approximately
$9.2 million, which accounted for
73.4% of total revenues in the third quarter of fiscal 2016.
- Net income for the third quarter of fiscal 2016 totaled
approximately $2.4 million, a
decrease of approximately 82.2% from the net income of
approximately $13.7 million in the
same period of last year. The decreased profit in this quarter
compared to the same quarter of last year was primarily due to a
slowdown of contracted sales achieved in the current quarter.
- Basic and diluted net earnings per share ("EPS") attributable
to shareholders for the third quarter of fiscal 2016 were
$0.05, compared to $0.30 for the same quarter 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, 2015, as well as the Company's
Quarterly Reports on Form 10-Q that have been filed since the date
of such annual report, 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)
|
|
|
|
June 30
|
|
|
September 30
|
|
|
|
2016
|
|
|
2015
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
Cash
|
|
$
|
2,085,365
|
|
|
$
|
1,333,919
|
|
Restricted cash
|
|
|
1,498,730
|
|
|
|
1,715,268
|
|
Cost and earnings in excess of
billings
|
|
|
10,647,842
|
|
|
|
11,825,036
|
|
Real estate property development
completed
|
|
|
65,629,882
|
|
|
|
75,391,512
|
|
Real estate property under
development
|
|
|
48,766,106
|
|
|
|
55,154,153
|
|
Other current assets
|
|
|
5,509,313
|
|
|
|
228,223
|
|
Total current
assets
|
|
|
134,137,238
|
|
|
|
145,648,111
|
|
Property, plant and equipment,
net
|
|
|
695,857
|
|
|
|
780,038
|
|
Real estate property development completed, net of
current portion
|
|
|
1,896,673
|
|
|
|
2,140,271
|
|
Security deposits for land use
right
|
|
|
2,932,377
|
|
|
|
3,146,237
|
|
Real estate property under development, net of
current portion
|
|
|
182,557,600
|
|
|
|
143,660,781
|
|
Due from local government for real estate property
development completed
|
|
|
3,010,099
|
|
|
|
3,065,000
|
|
Total Assets
|
|
$
|
325,229,844
|
|
|
$
|
$
298,440,438
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY
|
|
Current liabilities:
|
|
|
|
|
|
|
Bank loan
|
|
$
|
-
|
|
|
$
|
6,292,474
|
|
Other loans
|
|
|
6,149,632
|
|
|
|
5,674,239
|
|
Accounts payable
|
|
|
24,877,120
|
|
|
|
41,501,682
|
|
Other payables
|
|
|
9,810,636
|
|
|
|
12,676,362
|
|
Construction deposits
|
|
|
896,572
|
|
|
|
1,959,706
|
|
Billings in excess of cost and
earnings
|
|
|
1,680,886
|
|
|
|
3,315,302
|
|
Customer deposits
|
|
|
19,508,249
|
|
|
|
17,387,969
|
|
Shareholder loan
|
|
|
1,810,000
|
|
|
|
1,810,000
|
|
Accrued expenses
|
|
|
3,440,961
|
|
|
|
4,855,891
|
|
Taxes payable
|
|
|
15,448,779
|
|
|
|
15,830,886
|
|
Total current
liabilities
|
|
|
83,622,835
|
|
|
|
111,304,511
|
|
Deferred tax
liabilities
|
|
|
4,882,100
|
|
|
|
4,711,161
|
|
Customer deposits, net of current
portion
|
|
|
10,149,810
|
|
|
|
8,246,004
|
|
Other loans, less current
portion
|
|
|
70,212,895
|
|
|
|
15,731,186
|
|
Construction deposits, net of current
portion
|
|
|
700,921
|
|
|
|
972,432
|
|
Total
liabilities
|
|
|
169,568,561
|
|
|
|
140,965,294
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
|
Stockholders' equity
|
|
|
|
|
|
|
|
|
Common stock, $01 par value, 100,000,000
shares
|
|
|
|
|
|
|
|
|
authorized, 45,050,000 shares issued and
outstanding
|
|
|
|
|
|
|
|
|
June 30, 2016 and September 30,
2015
|
|
|
45,050
|
|
|
|
45,050
|
|
Additional paid-in
capital
|
|
|
17,809,016
|
|
|
|
17,764,316
|
|
Statutory surplus
|
|
|
16,439,333
|
|
|
|
16,439,333
|
|
Retained earnings
|
|
|
124,839,624
|
|
|
|
119,668,198
|
|
Accumulated other comprehensive
income
|
|
|
(3,471,740)
|
|
|
|
3,558,247
|
|
Total stockholders'
equity
|
|
|
155,661,283
|
|
|
|
157,475,144
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities and Stockholders'
Equity
|
|
$
|
325,229,844
|
|
|
$
|
298,440,438
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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
(LOSS)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
Three months ended June
30,
|
|
|
Nine months ended
31,
|
|
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Real estate
sales
|
|
$
|
12,497,413
|
|
|
$
|
26,014,516
|
|
|
$
|
25,205,879
|
|
|
$
|
60,138,945
|
|
|
Less: Sales
tax
|
|
|
(847,938)
|
|
|
|
(1,655,046)
|
|
|
|
(1,741,251)
|
|
|
|
(3,892,435)
|
|
|
Cost of real estate
sales
|
|
|
(8,183,462)
|
|
|
|
(9,347,052)
|
|
|
|
(15,520,371)
|
|
|
|
(27,702,998)
|
|
|
Gross profit
|
|
|
3,466,013
|
|
|
|
15,012,418
|
|
|
|
7,944,257
|
|
|
|
28,543,512
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling and distribution
expenses
|
|
|
71,959
|
|
|
|
211,558
|
|
|
|
288,138
|
|
|
|
804,700
|
|
|
General and administrative
expenses
|
|
|
609,428
|
|
|
|
427,363
|
|
|
|
1,668,790
|
|
|
|
1,636,889
|
|
|
Total operating
expenses
|
|
|
681,387
|
|
|
|
638,921
|
|
|
|
1,956,928
|
|
|
|
2,441,589
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
|
2,784,626
|
|
|
|
14,373,497
|
|
|
|
5,987,329
|
|
|
|
26,101,923
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
|
(29,917)
|
|
|
|
(22,540)
|
|
|
|
(203,057)
|
|
|
|
(54,300)
|
|
|
Income before income
taxes
|
|
|
2,754,709
|
|
|
|
14,350,957
|
|
|
|
5,784,272
|
|
|
|
26,047,623
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
|
310,548
|
|
|
|
641,368
|
|
|
|
612,846
|
|
|
|
1,441,943
|
|
|
Net income
|
|
|
2,444,161
|
|
|
|
13,709,589
|
|
|
|
5,171,426
|
|
|
|
24,605,680
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income
(loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation
adjustment
|
|
|
(4,745,409)
|
|
|
|
306,940
|
|
|
|
(7,029,987)
|
|
|
|
1,086,967
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income
(loss)
|
|
$
|
(2,301,248)
|
|
|
$
|
14,016,529
|
|
|
$
|
(1,858,561)
|
|
|
$
|
25,692,647
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted income per common
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted
|
|
$
|
0.05
|
|
|
$
|
0. 30
|
|
|
$
|
0.11
|
|
|
$
|
0.55
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares
outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
45,050,000
|
|
|
|
45,050,000
|
|
|
|
45,050,000
|
|
|
|
45,050,000
|
|
|
Diluted
|
|
|
45,050,000
|
|
|
|
45,075,821
|
|
|
|
45,050,000
|
|
|
|
45,089,819
|
|
|
|
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)
|
|
|
Nine months ended June
30,
|
|
|
|
2016
|
|
|
2015
|
|
Cash flows from operating
activities
|
|
|
|
|
Net income
|
|
$
|
5,171,426
|
|
|
$
|
24,605,680
|
|
|
Adjustments to reconcile net income to net cash
providing by (used in)
operating activities:
|
|
|
|
|
|
|
|
|
Deferred
tax provision
|
|
|
383,850
|
|
|
1,369,997
|
|
|
Stock based
compensation
|
|
|
44,700
|
|
|
|
-
|
|
|
Depreciation
|
|
|
59,658
|
|
|
|
63,137
|
|
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
|
Due from local government for real estate property
development completed
|
|
|
-
|
|
|
|
815,661
|
|
|
Cost and earnings in excess of
billings
|
|
|
681,609
|
|
|
|
942,175
|
|
|
Real estate property development
completed
|
|
|
6,811,151
|
|
|
|
1,915,343
|
|
|
Real estate property under
development
|
|
|
(42,105,175)
|
|
|
|
6,547,520
|
|
|
Other current assets
|
|
|
(5,418,847)
|
|
|
|
955,405
|
|
|
Accounts payables
|
|
|
(15,187,183)
|
|
|
|
(25,674,976)
|
|
|
Other payables
|
|
|
(2,373,223)
|
|
|
|
886,212
|
|
|
Billings in excess of cost and
earnings
|
|
|
(1,526,997)
|
|
|
|
4,786,440
|
|
|
Customer deposits
|
|
|
5,257,341
|
|
|
|
(7,585,864)
|
|
|
Construction deposits
|
|
|
(1,236,962)
|
|
|
|
12,902
|
|
|
Accrued expenses
|
|
|
(1,248,883)
|
|
|
|
1,126,826
|
|
|
Taxes payable
|
|
|
310,218
|
|
|
|
2,471,784
|
|
|
Net cash (used in) providing by operating
activities
|
|
|
(50,377,317)
|
|
|
|
13,238,242
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing
activities
|
|
|
|
|
|
|
|
|
|
Purchase of fixed assets
|
|
|
(8,010)
|
|
|
|
-
|
|
|
Net cash used in investing
activities
|
|
|
(8,010)
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from financing
activities
|
|
|
|
|
|
|
|
|
|
Restricted cash
|
|
|
145,758
|
|
|
|
(181,039)
|
|
|
Proceeds from shareholder
loan
|
|
|
840,077
|
|
|
|
10,500,816
|
|
|
Repayment of shareholder
loan
|
|
|
(840,077)
|
|
|
|
(12,084,829)
|
|
|
Repayment of bank
loans
|
|
|
(6,165,703)
|
|
|
|
(6,525,285)
|
|
|
Proceeds from other
loans
|
|
|
62,793,918
|
|
|
|
9,787,928
|
|
|
Repayment of other
loans
|
|
|
(5,559,922)
|
|
|
|
(12,094,617)
|
|
|
Net cash provided by (used in) financing
activities
|
|
|
51,214,050
|
|
|
|
(10,597,026)
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of changes of foreign exchange rate on
cash
|
|
|
(77,277)
|
|
|
|
17,623
|
|
|
Net increase in
cash
|
|
|
751,446
|
|
|
|
2,658,839
|
|
|
Cash, beginning of
period
|
|
|
1,333,919
|
|
|
|
1,125,545
|
|
|
Cash, end of
period
|
|
$
|
2,085,365
|
|
|
$
|
3,784,384
|
|
|
Supplemental disclosures of cash flow
information:
|
|
|
|
|
|
|
|
|
|
Interest paid
|
|
$
|
2,843,145
|
|
|
$
|
1,355,741
|
|
|
Income taxes paid
|
|
$
|
369,885
|
|
|
$
|
102,337
|
|
|
|
The accompanying notes are an integral part of these
unaudited condensed consolidated financial
statements.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/china-hgs-reports-third-quarter-of-fiscal-year-2016-results-300310937.html
SOURCE China HGS Real Estate Inc.