SAN DIEGO, Calif. and SHENZHEN, China, May
10, 2017 /PRNewswire/ -- Highpower International, Inc.
(NASDAQ: HPJ) ("Highpower" or the "Company"), a developer,
manufacturer, and marketer of lithium ion and nickel-metal hydride
(Ni-MH) rechargeable batteries, battery management systems, and a
provider of battery recycling, today announced its financial
results for the first quarter ended March
31, 2017.
First Quarter 2017 Highlights
- Net sales for the first quarter of 2017 increased by 43.9% to
$41.9 million from $29.1 million in the prior year period.
- Gross margin for the first quarter of 2017 increased to 23.7%
from 20.2% in the prior year period.
- Net income attributable to the Company for the first quarter of
2017 was $2.5 million, or
$0.17 per diluted share, as compared
to a net loss attributable to the Company of $0.3 million, or a net loss of $0.02 per diluted share in the prior year
period.
Mr. George Pan, Chairman and CEO
of Highpower International, commented, "We are extremely pleased to
have delivered another quarter of strong top- and bottom-line
results in the first quarter of 2017. Importantly, growth in our
lithium ion batteries business, including battery solutions,
continued to accelerate driven by demand for energy storage
systems, smart wearable devices, and other digital products.
Looking forward, we will continue to invest in areas that are
critical to our business and capture the market opportunities ahead
of us. With our solid product reputation and business foundations
in the industry, we are confident that we will be able to maintain
our strong growth momentum and continue to develop our business for
years to come."
First Quarter 2017 Financial Results
Net Sales
Net sales for the first quarter of 2017 increased by 43.9% to
$41.9 million from $29.1 million in the prior year period, primarily
attributable to increased revenue contribution from lithium
batteries as a result of the increased battery sales into markets
for smart wearable devices, digital products, and handheld devices
such as smart phones, tablets, and notebooks.
Gross Profit
Gross profit for the first quarter of 2017 increased by 69.0% to
$9.9 million from $5.9 million in the prior year period, primarily
attributable to enhanced product mix and improved labor efficiency.
Gross margin for the first quarter of 2017 increased to 23.7% from
20.2% in the prior year period.
Operating Expenses
- Research and development (R&D) expenses for
the first quarter of 2017 were $1.8
million as compared to $1.6
million in the prior year period. As a percentage of net
sales, R&D expenses decreased to 4.3% from 5.6% in the prior
year period.
- Selling and distribution expenses for the first
quarter of 2017 were $1.6 million as
compared to $1.5 million in the prior
year period. As a percentage of net sales, selling and distribution
expenses decreased to 3.9% from 5.3% in the prior year period,
primarily attributable to the Company's customer base optimization
efforts.
- General and administrative expenses for the first
quarter of 2017 remained stable at $3.1
million year over year. As a percentage of net sales,
general and administrative expenses decreased to 7.3% from 10.5% in
the prior year period.
Net Income
Net income attributable to the Company for the first quarter of
2017 increased to $2.5 million from
net loss attributable to the Company of $0.3
million in the prior year period. Net income attributable to
the Company per diluted share for the first quarter of 2017
increased to $0.17 from net loss
attributable to the Company per diluted share of $0.02 in the prior year period.
For the quarter ended March 31, 2017, the Company's
weighted average diluted shares outstanding used in computing
diluted share was 15,299,029.
EBITDA
EBITDA for the first quarter of 2017 increased by 308.5% to
$5.0 million from $1.2 million in the prior year period.
A table reconciling EBITDA, a non-GAAP
financial measure, to the appropriate GAAP measure is
included with the Company's financial information below.
Balance Sheet
Highlights
|
|
|
|
|
($ in millions,
except per share data)
|
|
March
31,
2017
|
|
December 31,
2016
|
|
|
(Unaudited)
|
|
|
|
|
$
|
|
$
|
Cash
|
|
$20.0
|
|
$9.3
|
Total Current
Assets
|
|
$115.2
|
|
$104.5
|
Total
Assets
|
|
$175.4
|
|
$163.3
|
|
|
|
|
|
Total Current
Liabilities
|
|
$127.3
|
|
$118.0
|
Total
Liabilities
|
|
$127.3
|
|
$118.0
|
Total
Equity
|
|
$48.1
|
|
$45.3
|
Total Liabilities and
Equity
|
|
$175.4
|
|
$163.3
|
Book Value Per
Share
|
|
$3.17
|
|
$3.00
|
Conference Call Details
The Company will hold a conference call on Wednesday, May 10, 2017 at 10:00 am Eastern Time or 10:00 pm Beijing Time to discuss the financial
results. Participants may access the call by dialing the following
numbers:
United States: 877-407-3108
International: 201-493-6797
To listen to the live webcast, please go to
www.highpowertech.com and click on the conference call link, or go
to http://highpowertech.equisolvewebcast.com/q1-2017. This webcast
will be archived and accessible through the Company's website for
approximately 30 days following the call.
About Highpower International, Inc.
Highpower International was founded in 2001 and produces
high-quality Nickel-Metal Hydride (Ni-MH) and lithium-based
rechargeable batteries used in a wide range of applications such as
electric buses, bikes, energy storage systems, power tools, medical
equipment, digital and electronic devices, personal care products,
and lighting, etc. Highpower's target customers are Fortune 500
companies and top 20 companies in each vertical segment. With
advanced manufacturing facilities located in Shenzhen, Huizhou, and Ganzhou of China, Highpower is committed to clean
technology, not only in the products it makes, but also in the
processes of production. The majority of Highpower International's
products are distributed to worldwide markets mainly in
the United States, Europe, China
and Southeast Asia.
Use of Non-GAAP Measures
The Company has supplemented its reported GAAP (generally
accepted accounting principles) financial information with non-GAAP
measures. EBITDA was derived by taking earnings before interest
expense (net), taxes, depreciation and amortization. The
presentation of this additional information is not meant to be
considered in isolation or as a substitute for results prepared in
accordance with U.S. GAAP. The Company believes this non-GAAP
measure is useful to investors as it provides a basis for
evaluating the Company's operating results in the ordinary course
of its operations. This non-GAAP measure is not based on any
comprehensive set of accounting rules or principles. The
Company believes that non-GAAP measures have limitations in that
they do not reflect all of the amounts associated with its results
of operations as determined in accordance with U.S. GAAP and that
these measures should only be used to evaluate the Company's
results of operations in conjunction with, and not in lieu of, the
corresponding GAAP measures. EBITDA is reconciled in the
accompanying table to the most directly comparable measure as
reported in accordance with GAAP.
Forward Looking Statements
This press release contains "forward-looking statements" within
the meaning of the "safe-harbor" provisions of the Private
Securities Litigation Reform Act of 1995 that are not
historical facts. These statements can be identified by the
use of forward-looking terminology such as "believe," "expect,"
"may," "will," "should," "project," "plan," "seek," "intend," or
"anticipate" or the negative thereof or comparable terminology.
Such statements involve known and unknown risks, uncertainties and
other factors that could cause the Company's actual results to
differ materially from the results expressed or implied by such
statements, including, without limitation, fluctuations in the cost
of raw materials; our dependence on, or inability to attract
additional, major customers for a significant portion of our net
sales; our ability to increase manufacturing capabilities to
satisfy orders from new customers; our ability to maintain
increased margins; our dependence on the growth in demand for smart
wearable devices and energy storage systems, and other digital
products and the success of manufacturers of the end applications
that use our battery products; our responsiveness to competitive
market conditions; our ability to successfully manufacture our
products in the time frame and amounts expected; the market
acceptance of our battery solutions, including our lithium ion
batteries; and our ability to continue R&D development to keep
up with technological changes. For a discussion of these and other
risks and uncertainties see "Risk Factors" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" in the Company's public filings with the SEC. Although
the Company believes that the expectations reflected in such
forward-looking statements are reasonable, there can be no
assurance that such expectations will prove to be correct. The
Company has no obligation to update the forward-looking information
contained in this press release.
CONTACT:
Highpower International, Inc.
Sunny Pan
Chief Financial Officer
Tel: +86-755-8968-6521
Email: ir@highpowertech.com
Yuanmei Ma
Investor Relations Manager
Tel: +1-909-214-2482
Email: ir@highpowertech.com
ICR, Inc.
Jessie
Fan
Tel: +1-646-931-0303
Email: ir@highpowertech.com
HIGHPOWER
INTERNATIONAL, INC. AND SUBSIDIARIES
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Stated in US
Dollars)
|
|
|
March
31,
|
|
December
31,
|
|
|
2017
|
|
2016
|
|
|
|
(Unaudited)
|
|
|
|
|
$
|
|
$
|
ASSETS
|
|
|
|
|
|
Current
Assets:
|
|
|
|
|
|
Cash
|
|
20,036,278
|
|
9,324,393
|
|
Restricted
cash
|
|
14,021,382
|
|
11,213,640
|
|
Accounts receivable,
net
|
|
39,324,098
|
|
46,280,769
|
|
Amount due from
Yipeng
|
|
7,420,500
|
|
7,517,250
|
|
Notes
receivable
|
|
868,427
|
|
1,093,730
|
|
Prepayments and other
receivables
|
|
7,536,315
|
|
6,899,872
|
|
Inventories
|
|
26,013,323
|
|
22,207,333
|
|
|
|
|
|
|
|
Total Current
Assets
|
|
115,220,323
|
|
104,536,987
|
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
44,751,137
|
|
43,504,991
|
|
Land use right,
net
|
|
3,631,897
|
|
3,622,435
|
|
Other
assets
|
|
487,500
|
|
500,000
|
|
Deferred tax
assets
|
|
1,366,041
|
|
1,477,761
|
|
Long-term
investment
|
|
9,919,428
|
|
9,689,576
|
|
|
|
|
|
TOTAL
ASSETS
|
|
175,376,326
|
|
163,331,750
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
|
Accounts
payable
|
|
44,170,801
|
|
49,463,901
|
|
Deferred
income
|
|
884,134
|
|
761,491
|
|
Short-term
loans
|
|
20,462,659
|
|
18,776,080
|
|
Non-financial
institution borrowings
|
|
10,158,767
|
|
3,741,115
|
|
Notes
payable
|
|
38,291,121
|
|
30,658,000
|
|
Amount due to
Yipeng
|
|
1,728,203
|
|
1,522,313
|
|
Other payables and
accrued liabilities
|
|
9,267,866
|
|
11,148,556
|
|
Income taxes
payable
|
|
2,310,168
|
|
1,963,298
|
|
|
|
|
|
|
|
Total Current
Liabilities
|
|
127,273,719
|
|
118,034,754
|
|
|
|
|
|
|
|
Warrant
Liability
|
|
31,811
|
|
259
|
|
|
|
|
|
|
TOTAL
LIABILITIES
|
|
127,305,530
|
|
118,035,013
|
|
|
|
|
|
COMMITMENTS AND
CONTINGENCIES
|
|
-
|
|
-
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
Stockholders'
equity
|
|
|
|
|
|
Preferred
stock
|
|
|
|
|
|
(Par value: $0.0001,
Authorized: 10,000,000 shares, Issued and
outstanding: none)
|
|
-
|
|
-
|
|
Common
stock
|
|
|
|
|
|
(Par value: $0.0001,
Authorized: 100,000,000 shares, 15,176,252
shares issued and outstanding at March 31, 2017 and 15,114,991
shares issued and outstanding at December 31, 2016)
|
|
1,517
|
|
1,511
|
|
Additional paid-in
capital
|
|
11,766,446
|
|
11,580,934
|
|
Statutory and other
reserves
|
|
4,992,463
|
|
4,992,463
|
|
Retained
earnings
|
|
31,801,717
|
|
29,266,068
|
|
Accumulated other
comprehensive income
|
|
(900,241)
|
|
(873,582)
|
|
|
|
|
|
|
|
Total equity
attributable to the stockholders of
Highpower International Inc.
|
|
47,661,902
|
|
44,967,394
|
|
|
|
|
|
|
|
Non-controlling
interest
|
|
408,894
|
|
329,343
|
|
|
|
|
|
|
TOTAL
EQUITY
|
|
48,070,796
|
|
45,296,737
|
|
|
|
|
|
|
TOTAL LIABILITIES
AND EQUITY
|
|
175,376,326
|
|
163,331,750
|
HIGHPOWER
INTERNATIONAL, INC. AND SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(LOSS)
|
(Stated in US
Dollars)
|
|
|
|
|
|
|
|
Three months ended March
31,
|
|
|
2017
|
|
2016
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
$
|
|
$
|
|
|
|
|
|
Net sales
|
|
41,866,848
|
|
29,097,055
|
Cost of
sales
|
|
(31,932,014)
|
|
(23,220,016)
|
Gross
profit
|
|
9,934,834
|
|
5,877,039
|
|
|
|
|
|
Research and
development expenses
|
|
(1,813,930)
|
|
(1,622,883)
|
Selling and
distribution expenses
|
|
(1,638,313)
|
|
(1,535,036)
|
General and
administrative expenses
|
|
(3,058,562)
|
|
(3,069,714)
|
Foreign currency
transaction loss
|
|
(313,878)
|
|
(90,436)
|
Total operating
expenses
|
|
(6,824,683)
|
|
(6,318,069)
|
|
|
|
|
|
Income (loss) from
operations
|
|
3,110,151
|
|
(441,030)
|
|
|
|
|
|
Changes in fair value
of warrant liability
|
|
(31,552)
|
|
119,469
|
Other
income
|
|
578,093
|
|
155,928
|
Equity in earnings of
investee
|
|
146,932
|
|
-
|
Interest
expenses
|
|
(603,317)
|
|
(274,992)
|
Income (loss) before
taxes
|
|
3,200,307
|
|
(440,625)
|
|
|
|
|
|
Income taxes
expenses
|
|
(587,765)
|
|
(35,504)
|
Net income
(loss)
|
|
2,612,542
|
|
(476,129)
|
|
|
|
|
|
Less: net income
(loss) attributable to non-controlling interest
|
|
76,893
|
|
(133,521)
|
Net income (loss)
attributable to the Company
|
|
2,535,649
|
|
(342,608)
|
|
|
|
|
|
Comprehensive income
(loss)
|
|
|
|
|
Net income
(loss)
|
|
2,612,542
|
|
(476,129)
|
Foreign currency
translation (loss) gain
|
|
(24,001)
|
|
250,146
|
Comprehensive income
(loss)
|
|
2,588,541
|
|
(225,983)
|
|
|
|
|
|
Less: comprehensive
income (loss) attributable to non-
controlling interest
|
|
79,551
|
|
(128,822)
|
Comprehensive income
(loss) attributable to the Company
|
|
2,508,990
|
|
(97,161)
|
|
|
|
|
|
Earnings (loss) per
share of common stock attributable to the Company
|
|
|
|
|
-
Basic
|
|
0.17
|
|
(0.02)
|
-
Diluted
|
|
0.17
|
|
(0.02)
|
|
|
|
|
|
Weighted average
number of common stock outstanding
|
|
|
|
|
-
Basic
|
|
15,119,693
|
|
15,101,679
|
-
Diluted
|
|
15,299,029
|
|
15,101,679
|
Reconciliation of
Net Income (loss) to EBITDA
|
|
|
|
Three months ended March
31,
|
|
2017
|
|
2016
|
|
(Unaudited)
|
|
(Unaudited)
|
|
$
|
|
$
|
Net income (loss)
attributable to the Company
|
2,535,649
|
|
(342,608)
|
|
|
|
|
Interest
expenses
|
603,317
|
|
274,992
|
Income taxes
expenses
|
587,765
|
|
35,504
|
Depreciation and
Amortization
|
1,274,334
|
|
1,256,379
|
|
|
|
|
EBITDA
|
5,001,065
|
|
1,224,267
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/highpower-international-reports-unaudited-first-quarter-2017-financial-results-300455054.html
SOURCE Highpower International, Inc.