BEIJING, Nov. 26, 2019 /PRNewswire/ -- Fuwei Films
(Holdings) Co., Ltd. (Nasdaq: FFHL) ("Fuwei Films" or the
"Company"), a manufacturer and distributor of high-quality BOPET
plastic films in China, today
announced its unaudited financial results for the three-month and
nine-month periods ended September 30,
2019.
Third Quarter 2019 Financial Highlights
- Net sales were RMB79.6 million
(US$11.1 million), compared to
RMB86.9 million during the same
period in 2018.
- Sales of specialty films were RMB40.6
million (US$5.7 million) or
51.0% of total revenues as compared to RMB45.3 million or 52.2% of total revenues in the
same period of 2018.
- Overseas sales were RMB11.6
million (US$1.6 million) or
14.6% of total revenues, compared with RMB8.5 million or 9.8% of total revenues in the
third quarter of 2018.
- Gross profit was RMB21.6 million
(US$3.0 million), representing a
gross margin rate of 27.1%, as compared to gross profit of
RMB17.1 million and a gross margin
rate of 19.6% for the same period in 2018.
- Net profit attributable to the Company was RMB3.4 million (US$0.5
million), compared to net loss attributable to the Company
of RMB1.8 million during the same
period in 2018, representing an increase in profit of RMB5.2 million.
First Nine Months 2019 Financial Highlights
- Net sales were RMB248.8 million
(US$34.8 million), compared to
RMB243.40 million, during the same
period in 2018, representing an increase of RMB5.4 million or 2.2%.
- Sales of specialty films were RMB114.7
million (US$16.0 million) or
46.1% of total revenues as compared to RMB109.0 million or 44.8% in the same period of
2018.
- Overseas sales were RMB42.2
million (US$5.9 million) or
16.9% of total revenues, compared with RMB36.1 million or 14.8% of total revenues in the
same period in 2018.
- Gross profit was RMB52.6 million
(US$7.4 million), representing a
gross margin of 21.2%, as compared to a gross margin of 13.7% for
the same period in 2018.
Mr. Zengyong Wang, Chairman and CEO of Fuwei Films, commented,
"Benefiting from our differentiated product strategy and continuous
R&D, we are pleased to continue to operate profitably for the
third quarter. Sales of specialty films stayed dominant in
wholesales and accounted for 51% of total sales during the quarter.
Looking ahead, the BOPET industry remains competitive as a result
of higher supply. Nevertheless, we will continue to innovate,
tackle overseas markets and execute our differentiated product
strategy to improve performance and capture opportunities."
Financial Results for the Three Months Ended September 30, 2019
Net sales during the third quarter ended September 30, 2019 were RMB79.6 million (US$11.1
million), compared to RMB86.9
million during the same period in 2018. The decrease of
average sales price caused a decrease of RMB4.6 million and the sales volume decrease
caused a decrease of RMB2.7
million.
In the third quarter of 2019, sales of specialty films were
RMB40.6 million (US$5.7 million) or 51.0% of total revenues as
compared to RMB45.3 million or 52.2%
in the same period of 2018. The decrease in average sales price
caused a decrease of RMB1.5 million
and the decrease in the sales volume caused a decrease of
RMB3.2 million.
The following is a breakdown of commodity and specialty film
sales (amounts in thousands):
|
Three-Month Period
Ended
September 30, 2019
|
% of
Total
|
|
Three-Month Period
Ended
September 30, 2018
|
% of
Total
|
|
RMB
|
US$
|
|
|
RMB
|
|
Stamping and transfer
film
|
26,552
|
3,715
|
33.3%
|
|
30,650
|
35.3%
|
Printing
film
|
7,881
|
1,103
|
9.9%
|
|
6,293
|
7.2%
|
Metallization
film
|
1,197
|
167
|
1.5%
|
|
773
|
0.9%
|
Specialty
film
|
40,559
|
5,674
|
51.0%
|
|
45,325
|
52.2%
|
Base film for other
application
|
3,397
|
475
|
4.3%
|
|
3,832
|
4.4%
|
|
|
|
|
|
|
|
|
79,586
|
11,134
|
100.0%
|
|
86,872
|
100.0%
|
Overseas sales were RMB11.6
million or US$1.6 million, or
14.6% of total revenues, compared with RMB8.5 million or 9.8% of total revenues in the
third quarter of 2018. The decrease in average sales price caused a
decrease of RMB0.8 million and the
increase in sales volume resulted in an increase of RMB3.9 million.
The following is a breakdown of PRC domestic and overseas sales
(amounts in thousands):
|
Three-Month Period
Ended
September 30, 2019
|
% of Total
|
Three-Month Period
Ended
September 30, 2018
|
% of Total
|
|
RMB
|
US$
|
RMB
|
Sales in
China
|
67,933
|
9,512
|
85.4%
|
78,369
|
90.2%
|
Sales in other
countries
|
11,593
|
1,622
|
14.6%
|
8,503
|
9.8%
|
|
|
|
|
|
|
|
79,586
|
11,134
|
100.0%
|
86,872
|
100.0%
|
Gross profit was RMB21.6 million
(US$3.0 million) for the third
quarter ended September 30, 2019,
representing a gross margin rate of 27.1%, compared to gross profit
of RMB17.1 million and a gross margin
rate of 19.6% for the same period in 2018. Correspondingly, gross
margin rate increased by 7.5 percentage point compared to the same
period in 2018.
Operating expenses for the third quarter ended September 30, 2019 were RMB16.3 million (US$2.3
million), which was RMB1.5
million, or 8.4% lower than the same period in 2018. This
decrease was mainly due to decreased expenses on research and
development.
Net profit attributable to the Company during the third quarter
ended September 30, 2019 was
RMB3.4million (US$0.5 million), compared to net loss
attributable to the Company of RMB1.8
million during the same period in 2018, representing an
increase in profit of RMB5.2
million.
Financial Results for the Nine Months Ended September 30, 2019
Net sales during the nine-month period ended September 30, 2019 were RMB248.8 million (US$34.8
million), compared to RMB243.40
million, during the same period in 2018, representing an
increase of RMB5.4 million or 2.2%,
mainly due to the increase in sales prices in the first nine months
of 2019.
In the nine-month period ended September 30, 2019, sales of
specialty films were RMB114.7 million
(US$16.0 million) or 46.1% of total
revenues as compared to RMB109.0
million or 44.8% in the same period of 2018, which was an
increase of RMB5.7 million, or 5.2%
as compared to the same period in 2018. The increase of average
sales price in the first nine months of 2019 caused an increase of
RMB1.8 million and the increase in
the sales volume caused an increase of RMB3.9 million.
The following is a breakdown of commodity and specialty film
sales (amounts in thousands):
|
Nine-Month Period
Ended
September 30, 2019
|
% of
Total
|
|
Nine-Month Period
Ended
September 30, 2018
|
% of Total
|
|
RMB
|
US$
|
|
|
RMB
|
|
Stamping and transfer
film
|
86,675
|
12,126
|
34.9%
|
|
90,930
|
37.3%
|
Printing
film
|
28,613
|
4,003
|
11.5%
|
|
23,874
|
9.8%
|
Metallization
film
|
3,811
|
533
|
1.5%
|
|
2,568
|
1.1%
|
Specialty
film
|
114,713
|
16,049
|
46.1%
|
|
109,020
|
44.8%
|
Base film for other
applications
|
14,965
|
2,094
|
6.0%
|
|
17,006
|
7.0%
|
|
|
|
|
|
|
|
|
248,777
|
34,805
|
100.0%
|
|
243,398
|
100.0%
|
Overseas sales during the nine months ended September 30, 2019 were RMB42.2 million or US$5.9
million or 16.9% of total revenues, compared to RMB36.1 million or 14.8% of total revenues in the
same period in 2018. This was RMB6.1
million higher than the same period in 2018. The increase in
sales volume resulted in an increase of RMB4.7 million and the increase of average sales
price caused an increase of RMB1.4
million.
The following is a breakdown of PRC domestic and overseas sales
(amounts in thousands):
|
|
Nine-Month Period
Ended
September 30, 2019
|
% of Total
|
Nine-Month Period
Ended
September 30, 2018
|
% of Total
|
|
|
RMB
|
US$
|
RMB
|
Sales in
China
|
|
206,625
|
28,907
|
83.1%
|
207,291
|
85.2%
|
Sales in other
countries
|
|
42,152
|
5,898
|
16.9%
|
36,107
|
14.8%
|
|
|
|
|
|
|
|
|
|
248,777
|
34,805
|
100.0%
|
243,398
|
100.0%
|
Gross profit was RMB52.6 million
(US$7.4 million) for the first nine
months ended September 30, 2019,
representing a gross margin of 21.2%, compared to a gross margin of
13.7% for the same period in 2018. Correspondingly, gross margin
increased by 7.5 percentage. Average product sales prices increased
by 2.2% compared to the same period last year while the average
cost of goods sold decreased by 6.6% compared to the same period
last year. This resulted in an increase in gross profit.
Operating expenses for the nine months ended September 30, 2019 were RMB44.9 million (US$6.3
million), compared to RMB47.0
million in the same period in 2018, which was RMB2.1 million or 4.5% lower than the same period
in 2018. This decrease was mainly due to decreased expenses on
research and development.
Net profit attributable to the Company during the first
nine-month period of 2019 was RMB1.0
million (US$0.1 million)
compared to net loss attributable to the Company of RMB18.7 million during the same period in 2018,
representing an increase of RMB19.7
million from the same period in 2018 due to the factors
described above.
Cash, cash equivalent and restricted cash totaled RMB74.9 million or US$10.5
million as of September 30,
2019. Total shareholders' equity was RMB197.9 million or US$27.7 million.
As of September 30, 2019, the
Company had 3,265,837 basic and diluted total ordinary shares
outstanding.
Conference Call Information
The Company will host a teleconference on Wednesday, November 27, 2019, at 8:00 a.m. ET / 9:00
p.m. Beijing time to
discuss the financial results. To participate in the call, please
dial +1-844-369-8770 in North
America, or +1-862-298-0840 internationally, approximately
10 minutes prior to the scheduled start time.
A replay of the call can also be accessed via telephone by
calling +1-877-481-4010 in North
America, or +1-919-882-2331 internationally, and entering
the following Conference ID: 56850. The replay will be available
until December 27, 2019, at
8:00 a.m. ET.
About Fuwei Films
Fuwei Films develops, manufactures and distributes high-quality
plastic films using the biaxial oriented stretch technique, also
known as BOPET film. Fuwei's BOPET film is widely used to package
food, medicine, cosmetics, tobacco, and alcohol, as well as in the
imaging, electronics, and magnetic products industries.
Safe Harbor
This press release contains information that constitutes
forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995
and are subject to risks. Risk factors that could contribute to
such differences include those matters more fully disclosed in the
Company's reports filed with the U.S. Securities and Exchange
Commission which, among other things, include the significant
oversupply of BOPET films resulting from the rapid growth of the
Chinese BOPET industry capacity, changes in the international
market and trade barriers, especially the uncertainty of the
antidumping investigation and imposition of an anti-dumping duty on
imports of the BOPET films originating from the People's Republic of China ("China") conducted by certain countries;
uncertainty around U.S.-China
trade war and its effect on the Company's operation, fluctuations
of the RMB exchange rate, and our ability to obtain adequate
financing for our planned capital expenditure requirements;
uncertainty as to our ability to continuously develop new BOPET
film products and keep up with changes in BOPET film technology;
risks associated with possible defects and errors in our products;
uncertainty as to our ability to protect and enforce our
intellectual property rights; uncertainty as to our ability to
attract and retain qualified executives and personnel; and
uncertainty in acquiring raw materials on time and on acceptable
terms, particularly in view of the volatility in the prices of
petroleum products in recent years. The forward-looking information
provided herein represents the Company's estimates as of the date
of the press release, and subsequent events and developments may
cause the Company's estimates to change. The Company specifically
disclaims any obligation to update the forward-looking information
in the future. Therefore, this forward-looking information should
not be relied upon as representing the Company's estimates of its
future financial performance as of any date subsequent to the date
of this press release. Actual results of our operations may differ
materially from information contained in the forward-looking
statements as a result of the risk factors.
For more information, please contact:
In China:
Ms Xiaoli Yu
Investor Relations Officer
Phone: +86-133-615-59266
Email: fuweiIR@fuweifilms.com
In the U.S.:
Mr. Shiwei Yin
Investor Relations
Grayling
Phone: +1-646-284-9474
Email: shiwei.yin@grayling.com
FUWEI FILMS
(HOLDINGS) CO., LTD. AND SUBSIDIARIES
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
AS OF SEPTEMBER
30, 2019 AND DECEMBER 31, 2018
|
(amounts in thousands
except share and per share value)
|
(Unaudited)
|
|
|
|
September 30,
2019
|
|
December 31,
2018
|
|
RMB
|
US$
|
|
RMB
|
ASSETS
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
50,217
|
7,026
|
|
8,908
|
Restricted
cash
|
|
24,700
|
3,456
|
|
38,000
|
Accounts and bills
receivable, net
|
|
23,596
|
3,301
|
|
22,627
|
Inventories
|
|
22,135
|
3,097
|
|
24,675
|
Advance to
suppliers
|
|
10,527
|
1,473
|
|
5,694
|
Prepayments and other
receivables
|
|
1,223
|
171
|
|
1,068
|
Deferred tax assets –
current
|
|
1,169
|
164
|
|
1,195
|
Total current
assets
|
|
133,567
|
18,688
|
|
102,167
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
310,101
|
43,385
|
|
331,168
|
Construction in
progress
|
|
-
|
-
|
|
366
|
Lease prepayments,
net
|
|
15,895
|
2,224
|
|
16,296
|
Advance to suppliers
- long term, net
|
|
1,542
|
216
|
|
1,542
|
Deferred tax assets -
non current
|
|
3,037
|
425
|
|
3,143
|
|
|
|
|
|
|
Total
assets
|
|
464,142
|
64,938
|
|
454,682
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
Current
liabilities
|
|
|
|
|
|
Short-term
borrowings
|
|
65,000
|
9,094
|
|
64,950
|
Due to related
parties
|
|
118,149
|
16,530
|
|
114,692
|
Accounts
payables
|
|
21,142
|
2,958
|
|
20,750
|
Notes
payable
|
|
49,400
|
6,911
|
|
48,000
|
Advance from
customers
|
|
4,306
|
602
|
|
1,859
|
Accrued expenses and
other payables
|
5,941
|
831
|
|
5,072
|
Total current
liabilities
|
|
263,938
|
36,926
|
|
255,323
|
|
|
|
|
|
|
Deferred tax
liabilities
|
|
2,352
|
329
|
|
2,528
|
|
|
|
|
|
|
Total
liabilities
|
|
266,290
|
37,255
|
|
257,851
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
Registered capital
(of US$0.519008 par value; 5,000,000 shares authorized; 3,265,837
issued and outstanding)
|
|
13,323
|
1,864
|
|
13,323
|
Additional paid-in
capital
|
|
311,907
|
43,637
|
|
311,907
|
Statutory
reserve
|
|
37,441
|
5,238
|
|
37,441
|
Accumulated
deficit
|
|
(165,659)
|
(23,177)
|
|
(166,680)
|
Cumulative
translation adjustment
|
|
840
|
121
|
|
840
|
Total
equity
|
|
197,852
|
27,683
|
|
196,831
|
Total liabilities
and equity
|
|
464,142
|
64,938
|
|
454,682
|
FUWEI FILMS
(HOLDINGS) CO., LTD. AND SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(LOSS)
|
FOR THE THREE- AND
NINE-MONTH PERIODS ENDED SEPTEMBER 30, 2019 AND 2018
|
(amounts in thousands
except share and per share value)
|
(Unaudited)
|
|
|
|
The Three-Month
Period Ended September 30,
|
The Nine-Month
Period Ended September 30,
|
|
|
|
2019
|
|
2018
|
2019
|
|
2018
|
|
RMB
|
US$
|
|
RMB
|
RMB
|
US$
|
|
RMB
|
Net sales
|
|
79,586
|
11,134
|
|
86,872
|
248,777
|
34,805
|
|
243,398
|
Cost of
sales
|
|
57,996
|
8,114
|
|
69,812
|
196,154
|
27,443
|
|
210,051
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
21,590
|
3,020
|
|
17,060
|
52,623
|
7,362
|
|
33,347
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
Selling
expenses
|
|
3,236
|
453
|
|
2,960
|
9,737
|
1,362
|
|
9,325
|
Administrative
expenses
|
|
13,083
|
1,830
|
|
14,874
|
35,113
|
4,912
|
|
37,667
|
Total operating
expenses
|
|
16,319
|
2,283
|
|
17,834
|
44,850
|
6,274
|
|
46,992
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
5,271
|
737
|
|
(774)
|
7,773
|
1,088
|
|
(13,645)
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
|
- Interest
income
|
|
255
|
36
|
|
356
|
671
|
94
|
|
739
|
- Interest
expense
|
|
(2,240)
|
(313)
|
|
(2,769)
|
(6,675)
|
(934)
|
|
(7,227)
|
- Others income
(expense), net
|
|
80
|
11
|
|
1,324
|
(792)
|
(111)
|
|
1,369
|
|
|
|
|
|
|
|
|
|
|
Total other
expense
|
|
(1,905)
|
(266)
|
|
(1,089)
|
(6,796)
|
(951)
|
|
(5,119)
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before
provision
for income taxes
|
|
3,366
|
471
|
|
(1,863)
|
977
|
137
|
|
(18,764)
|
|
|
|
|
|
|
|
|
|
|
Income tax
benefit
|
|
77
|
11
|
|
15
|
44
|
6
|
|
49
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
3,443
|
482
|
|
(1,848)
|
1,021
|
143
|
|
(18,715)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
loss
|
|
|
|
|
|
|
|
|
|
- Foreign currency
translation
adjustments
|
|
1
|
0
|
|
24
|
-
|
-
|
|
(2,053)
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income
(loss)
|
|
3,444
|
482
|
|
(1,824)
|
1,021
|
143
|
|
(20,768)
|
|
|
|
|
|
|
|
|
|
|
Income (loss) per
share,
Basic and diluted
|
12
|
1.05
|
0.15
|
|
(0.57)
|
0.31
|
0.04
|
|
(5.73)
|
Weighted average
number
ordinary shares,
Basic and diluted
|
|
3,265,837
|
3,265,837
|
|
3,265,837
|
3,265,837
|
3,265,837
|
|
3,265,837
|
|
|
|
|
|
|
|
|
|
|
|
FUWEI FILMS
(HOLDINGS) CO., LTD. AND SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
FOR THE NINE-MONTH
PERIODS ENDED SEPTEMBER 30, 2019 AND 2018
|
(amounts in thousands
except share and per share value)
|
(Unaudited)
|
|
|
|
The Nine-Month
Period Ended September 30,
|
|
|
2019
|
|
2018
|
|
|
RMB
|
US$
|
|
RMB
|
Cash flow from
operating activities
|
|
|
|
|
|
Net income
(loss)
|
|
1,021
|
143
|
|
(18,715)
|
Adjustments to
reconcile net loss to net cash used in operating
activities
|
|
|
|
|
|
- Depreciation of
property, plant and equipment
|
|
33,957
|
4,751
|
|
33,271
|
- Amortization of
intangible assets
|
|
400
|
56
|
|
400
|
- Deferred income
taxes
|
|
(44)
|
(6)
|
|
(51)
|
- Bad debt (recovery)
expense
|
|
(897)
|
(125)
|
|
(132)
|
-Inventory
provision
|
|
724
|
101
|
|
-
|
Changes in operating
assets and liabilities
|
|
|
|
|
|
- Accounts and bills
receivable
|
|
(72)
|
(10)
|
|
4,682
|
-
Inventories
|
|
1,815
|
254
|
|
(1,016)
|
- Advance to
suppliers
|
|
(4,833)
|
(676)
|
|
(4,987)
|
- Prepaid expenses and
other current assets
|
|
(155)
|
(22)
|
|
(551)
|
- Accounts
payable
|
|
393
|
56
|
|
2,436
|
- Accrued expenses and
other payables
|
|
501
|
70
|
|
(1,031)
|
- Advance from
customers
|
|
2,447
|
342
|
|
6,852
|
- Tax
payable
|
|
368
|
51
|
|
1,270
|
|
|
|
|
|
|
Net cash provided by
(used in) operating activities
|
|
35,625
|
4,985
|
|
22,428
|
|
|
|
|
|
|
Cash flow from
investing activities
|
|
|
|
|
|
Purchases of
property, plant and equipment
|
|
(12,889)
|
(1,803)
|
|
(4,812)
|
Restricted cash
related to trade finance
|
|
-
|
-
|
|
-
|
Advance to suppliers
- non current
|
|
-
|
-
|
|
28
|
Amount change in
construction in progress
|
|
366
|
51
|
|
-
|
|
|
|
|
|
|
Net cash used in
investing activities
|
|
(12,523)
|
(1,752)
|
|
(4,784)
|
|
|
|
|
|
|
Cash flow from
financing activities
|
|
|
|
|
|
Principal payments of
bank loans
|
|
-
|
-
|
|
-
|
Proceeds from
short-term bank loans
|
|
50
|
7
|
|
14,950
|
Proceeds from related
party
|
|
3,457
|
484
|
|
(37,472)
|
Change in notes
payable
|
|
1,400
|
196
|
|
23,080
|
|
|
|
|
|
|
Net cash provided by
financing activities
|
|
4,907
|
687
|
|
558
|
|
|
|
|
|
|
Effect of foreign
exchange rate changes
|
|
-
|
(261)
|
|
(2,041)
|
|
|
|
|
|
|
Net increase in cash
and cash equivalent
|
|
28,009
|
3,659
|
|
16,161
|
|
|
|
|
|
|
Cash and cash
equivalent
|
|
|
|
|
|
At beginning of
period/year
|
|
46,908
|
6,823
|
|
69,464
|
At end of
period/year
|
|
74,917
|
10,482
|
|
85,625
|
|
|
|
|
|
|
SUPPLEMENTARY
DISCLOSURE:
|
|
|
|
|
|
Interest
paid
|
|
6,675
|
934
|
|
7,227
|
Income tax
paid
|
|
-
|
-
|
|
-
|
|
|
|
|
|
|
SUPPLEMENTARY
SCHEDULE OF NONCASH INVESTING AND FINANCIAL
ACTIVITIES:
|
Account payable for
plant and equipment:
|
|
1,062
|
149
|
|
1,029
|
View original
content:http://www.prnewswire.com/news-releases/fuwei-films-announces-third-quarter-of-2019-unaudited-financial-results-300964696.html
SOURCE Fuwei Films (Holdings) Co., Ltd.