NEW YORK, June 5, 2020 /PRNewswire/ -- Newater Technology,
Inc. (NASDAQ: NEWA) (''NEWA,'' ''we,'' ''our'' or the ''Company''),
a leading company specializing in development, production and
application of DTRO equipment and systems used in waste water
filtration, today announced its financial results for the year
ended December 31, 2019.
The year ended December 31, 2019
Financial Highlights (all comparisons to the year ended
December 31, 2018):
Revenues decreased by 20% from $47
million to $37.6 million in
2019, the decrease in revenues for the year ended December 31, 2019 was mainly due to in 2017-2018,
the revenue of Laixi operation project accounted for a large
proportion of the whole year's revenue. In 2019, there was no such
operation project that generated as much revenue.
Cost of revenues decreased by 17% from $26 million to $21.7
million in 2019, the decrease in cost of revenues directly
corresponded to the decrease in revenue during the same year.
Gross profit decreased by 24% from $20.9
million to $15.9 million in
2019, while the gross profit margin was 42% in 2019.
Net income (before currency translation loss) decreased by 40%
from $7.2 million to $4.3 million in 2019, and the net profit margin
in 2019 was 11.48%.
Total assets increased by 26% from $62
million to $78 million in 2019
mainly driven by the new production facility and production line
completed during the year.
Basic earnings per share was $0.40
in 2019, compared to $0.67 in 2018
and $0.26 in 2017.
Mr. Yuebiao Li, the Company's CEO, commented "We are pleased
with our accomplishments in 2019, we moved our business office to a
new industrial park, management has focused its attention to
strategic adjustments of operations and administration, invested
more effort in an innovative team for the construction of new
products, established a new R & D laboratory, completed our new
automatic DTRO membrane production line to achieve high production
standard, instituted a chief engineer responsible for product
quality in each of the industries we serve, and developed a new
patented process package."
In 2020, we will continue to make more efforts to skillfully
apply our products to more wastewater treatment fields and
undertake larger projects, in order to achieve company's eternal
goal of "renewable resources (New Water) recycling".
About Newater Technology, Inc.
Founded in 2012 and headquartered in Yantai, China, Newater, operating its business through
its wholly owned subsidiary Yantai Jinzheng Eco-Technology Co.
Ltd., specializes in the development, manufacture and sale of DTRO
(Disk Tube Reverse Osmosis) and DTNF (Disk Tube Nano-Filtration)
membranes for waste water treatment, recycling and discharge.
Newater provides integrated technical solutions in engineering
support and installation, technical advice and services, and, and
other project-related solutions to turn wastewater into valuable
clean water. Newater also provides wastewater treatment services,
such as landfill leachate treatment and purification services.
More information about the Company can be found at
www.dtNEWA.com.
The Company's products can be used across a wide spectrum of
industries, including:
- Landfill leachate;
- Wastewater from coal mines;
- Industrial park common effluent; and
- Briny wastewater.
More information about the Company can be found at:
www.dtNEWA.com
Notice
Rounding amounts and percentages: Certain amounts and
percentages included in this press release have been rounded for
ease of presentation. Percentage figures included in this press
release have not in all cases been calculated on the basis of such
rounded figures, but on the basis of such amounts prior to
rounding. For this reason, certain percentage amounts in this press
release may vary from those obtained by performing the same
calculations using the figures in the financial statements. In
addition, certain other amounts that appear in this press release
may not sum due to rounding.
Forward-Looking Statements
This press release contains forward-looking statements as
defined by the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include statements concerning plans,
objectives, goals, strategies, future events or performance, and
underlying assumptions and other statements that are other than
statements of historical facts. When the Company uses words such as
"may", "will", "intend", "should", "believe", "expect",
"anticipate", "project", "estimate" or similar expressions that do
not relate solely to historical matters, it is making
forward-looking statements. Specifically, the Company's statements
regarding its ability to apply its products to more industries and
obtain larger products are forward-looking
statements. Forward-looking statements are not guarantees of
future performance and involve risks and uncertainties that may
cause the actual results to differ materially from the Company's
expectations discussed in the forward-looking statements. These
statements are subject to uncertainties and risks including, but
not limited to, the following: the Company's goals and strategies;
the Company's future business development; product and service
demand and acceptance; changes in technology; economic conditions;
the growth of the water filtration industry in China; reputation and brand; the impact of
competition and pricing; government regulations; fluctuations in
general economic and business conditions in China and assumptions underlying or related to
any of the foregoing and other risks contained in reports filed by
the Company with the Securities and Exchange Commission. For
these reasons, among others, investors are cautioned not to place
undue reliance upon any forward-looking statements in this press
release. Additional factors are discussed in the Company's filings
with the U.S. Securities and Exchange Commission, which are
available for review at www.sec.gov. The Company undertakes no
obligation to publicly revise these forward-looking statements to
reflect events or circumstances that arise after the date hereof.
NEWATER
TECHNOLOGY, INC. AND SUBSIDIARIES
CONSOLIDATED
BALANCE SHEETS
|
|
December 31,
2019
|
|
December 31,
2018
|
|
|
|
|
ASSETS
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
9,944,765
|
|
$
|
2,461,501
|
Restricted cash,
current
|
|
4,021,177
|
|
|
6,033,482
|
Accounts receivable,
net
|
|
11,293,625
|
|
|
10,064,847
|
Accounts receivable -
related parties, net
|
|
2,392,087
|
|
|
1,948,009
|
Notes
receivable
|
|
360,505
|
|
|
6,999
|
Inventories
|
|
13,715,369
|
|
|
13,762,959
|
Deposit - related
party
|
|
-
|
|
|
10,180
|
Deferred cost of
revenue
|
|
221,737
|
|
|
343,090
|
Advances to suppliers
and other current assets, net
|
|
4,699,755
|
|
|
4,904,290
|
Total current
assets
|
|
46,649,020
|
|
|
39,535,357
|
|
|
|
|
|
|
Retentions
receivable, non-current
|
|
734,140
|
|
|
344,856
|
Property, plant and
equipment, net
|
|
24,611,862
|
|
|
18,753,340
|
Land use right,
net
|
|
2,008,096
|
|
|
2,078,240
|
Operating lease
right-of-use assets, net
|
|
141,016
|
|
|
-
|
Deferred tax
assets
|
|
-
|
|
|
604,064
|
Deposit on loan
agreement
|
|
918,643
|
|
|
436,275
|
Long-term
investments
|
|
2,997,419
|
|
|
-
|
Total
assets
|
$
|
78,060,196
|
|
$
|
61,752,132
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Accounts payable and
bank acceptance notes to vendors
|
$
|
8,099,529
|
|
$
|
5,353,538
|
Accounts payable -
related parties
|
|
5,225,004
|
|
|
3,389,148
|
Loans due within one
year
|
|
11,809,449
|
|
|
10,867,111
|
Advances from
customers
|
|
5,522,913
|
|
|
2,953,595
|
Advances from
customers - related parties
|
|
7,254,968
|
|
|
586,719
|
Income tax
payables
|
|
322,419
|
|
|
732,699
|
Accrued expenses and
other payables
|
|
6,971,505
|
|
|
6,375,800
|
Operating lease
liabilities, current
|
|
56,852
|
|
|
-
|
Deferred
income
|
|
43,061
|
|
|
-
|
Total current
liabilities
|
|
45,305,700
|
|
|
30,258,610
|
|
|
|
|
|
|
Deferred Income,
non-current
|
|
43,061
|
|
|
-
|
Deferred tax
liabilities
|
|
288,687
|
|
|
-
|
Operating lease
liabilities, non-current
|
|
68,420
|
|
|
-
|
Long term loans, less
current portion and unamortized debt issuance costs
|
|
1,377,217
|
|
|
4,449,889
|
Total non-current
liabilities
|
|
1,777,385
|
|
|
4,449,889
|
Total
liabilities
|
|
47,083,085
|
|
|
34,708,499
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
Common shares ($0.001
par value, 200,000,000 shares authorized,10,809,000 shares issued
and outstanding as of December 31, 2019 and December 31,
2018)
|
|
10,809
|
|
|
10,809
|
Additional paid-in
capital
|
|
26,303,348
|
|
|
15,059,181
|
Statutory
reserves
|
|
2,267,219
|
|
|
1,765,711
|
Retained
earnings
|
|
3,946,021
|
|
|
11,380,149
|
Accumulated other
comprehensive loss
|
|
(1,550,286)
|
|
|
(1,172,217)
|
Total
shareholders' equity
|
|
30,977,111
|
|
|
27,043,633
|
Total liabilities
and shareholders' equity
|
$
|
78,060,196
|
|
$
|
61,752,132
|
NEWATER
TECHNOLOGY, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
|
|
For the Years
ended December 31,
|
|
2019
|
|
2018
|
|
2017
|
|
|
|
|
|
|
Net
revenues
|
$
|
23,716,978
|
|
$
|
25,973,963
|
|
$
|
16,192,503
|
Net revenues from
related parties
|
|
13,857,014
|
|
|
21,066,741
|
|
|
9,146,994
|
Total
revenues
|
|
37,573,992
|
|
|
47,040,704
|
|
|
25,339,497
|
Cost of
revenues
|
|
20,233,998
|
|
|
20,474,072
|
|
|
17,199,866
|
Cost of revenues from
related parties
|
|
1,450,627
|
|
|
5,669,252
|
|
|
-
|
Total cost of revenues
|
|
21,684,625
|
|
|
26,143,324
|
|
|
17,199,866
|
Gross profit
|
|
15,889,367
|
|
|
20,897,380
|
|
|
8,139,631
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Selling, general and
administrative
|
|
10,148,039
|
|
|
12,025,924
|
|
|
5,452,349
|
Total
operating expenses
|
|
10,148,039
|
|
|
12,025,924
|
|
|
5,452,349
|
Income from
operations
|
|
5,741,328
|
|
|
8,871,456
|
|
|
2,687,282
|
Interest
expense
|
|
1,087,051
|
|
|
658,290
|
|
|
242,707
|
Interest
income
|
|
(38,328)
|
|
|
(26,632)
|
|
|
(112,592)
|
Government
grants
|
|
(946,164)
|
|
|
(627,748)
|
|
|
(513,538)
|
Investment
loss
|
|
17,023
|
|
|
-
|
|
|
-
|
Other expenses
(income)
|
|
(153,546)
|
|
|
(1,162)
|
|
|
3,956
|
Total other expenses (income)
|
|
(33,964)
|
|
|
2,748
|
|
|
(379,467)
|
Income before
income taxes provisions
|
|
5,775,292
|
|
|
8,868,708
|
|
|
3,066,749
|
Income tax
provisions
|
|
1,463,745
|
|
|
1,657,279
|
|
|
475,818
|
Net
income
|
$
|
4,311,547
|
|
$
|
7,211,429
|
|
$
|
2,590,931
|
Other comprehensive
income (loss)
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustment
|
|
(378,069)
|
|
|
(1,159,084)
|
|
|
535,810
|
Total
comprehensive income
|
$
|
3,933,478
|
|
$
|
6,052,345
|
|
$
|
3,126,741
|
|
|
|
|
|
|
|
|
|
Earnings per
common share
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.40
|
|
$
|
0.67
|
|
$
|
0.26
|
Diluted
|
$
|
0.40
|
|
$
|
0.67
|
|
$
|
0.26
|
Weighted average
common shares outstanding
|
|
|
|
|
|
|
|
|
Basic
|
|
10,809,000
|
|
|
10,809,000
|
|
|
9,864,479
|
Diluted
|
|
10,809,000
|
|
|
10,809,000
|
|
|
9,864,479
|
NEWATER
TECHNOLOGY, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
|
|
Number of
Shares
|
|
Common
Shares
|
|
Additional Paid-in
Capital
|
|
Retained
Earnings
|
|
Statutory
Reserves
|
|
Accumulated Other
Comprehensive Loss
|
|
Total
Shareholder's Equity
|
Balance, January
1, 2017
|
|
9,199,000
|
|
$
|
9,199
|
|
$
|
7,949,466
|
|
$
|
2,960,698
|
|
$
|
382,802
|
|
$
|
(548,943)
|
|
$
|
10,753,222
|
Net income
|
|
|
|
|
|
|
|
|
|
|
2,590,931
|
|
|
|
|
|
|
|
|
2,590,931
|
Statutory
reserves
|
|
|
|
|
|
|
|
|
|
|
(322,896)
|
|
|
322,896
|
|
|
|
|
|
-
|
Issuance of common
shares for cash
|
|
1,610,000
|
|
|
1,610
|
|
|
7,109,715
|
|
|
|
|
|
|
|
|
|
|
|
7,111,325
|
Foreign currency
translation adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
535,810
|
|
|
535,810
|
Balance, December
31, 2017
|
|
10,809,000
|
|
$
|
10,809
|
|
$
|
15,059,181
|
|
$
|
5,228,733
|
|
$
|
705,698
|
|
$
|
(13,133)
|
|
$
|
20,991,288
|
Net income
|
|
|
|
|
|
|
|
|
|
|
7,211,429
|
|
|
|
|
|
|
|
|
7,211,429
|
Statutory
reserves
|
|
|
|
|
|
|
|
|
|
|
(1,060,013)
|
|
|
1,060,013
|
|
|
|
|
|
-
|
Foreign currency
translation adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,159,084)
|
|
|
(1,159,084)
|
Balance, December
31, 2018
|
|
10,809,000
|
|
$
|
10,809
|
|
$
|
15,059,181
|
|
$
|
11,380,149
|
|
$
|
1,765,711
|
|
$
|
(1,172,217)
|
|
$
|
27,043,633
|
Net loss
|
|
|
|
|
|
|
|
|
|
|
4,311,547
|
|
|
|
|
|
|
|
|
4,311,547
|
Statutory
reserves
|
|
|
|
|
|
|
|
|
|
|
(501,508)
|
|
|
501,508
|
|
|
|
|
|
-
|
Capital increase from
retained earnings
|
|
|
|
|
|
|
|
11,244,167
|
|
|
(11,244,167)
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(378,069)
|
|
|
(378,069)
|
Balance, December
31, 2019
|
|
10,809,000
|
|
$
|
10,809
|
|
$
|
26,303,348
|
|
$
|
3,946,021
|
|
$
|
2,267,219
|
|
$
|
(1,550,286)
|
|
$
|
30,977,111
|
NEWATER
TECHNOLOGY, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
For the Years
Ended December 31,
|
|
2019
|
|
2018
|
|
2017
|
Cash flows from
operating activities
|
|
|
|
|
|
|
|
|
Net income
|
$
|
4,311,547
|
|
$
|
7,211,429
|
|
$
|
2,590,931
|
Adjustments to
reconcile net income to net cash used in operating
activities:
|
|
|
|
|
|
|
|
|
Loss from equity
method investment
|
|
17,023
|
|
|
-
|
|
|
-
|
Depreciation and
amortization expense
|
|
1,549,296
|
|
|
558,327
|
|
|
233,493
|
Deferred income
taxes
|
|
892,548
|
|
|
(118,199)
|
|
|
(312,997)
|
Bad debt
expense
|
|
1,243,709
|
|
|
280,228
|
|
|
229,707
|
Amortization of debt
issuance costs
|
|
324,221
|
|
|
103,772
|
|
|
-
|
Noncash lease
expense
|
|
41,935
|
|
|
-
|
|
|
-
|
Loss on disposal of
property, plant and equipment
|
|
1,367
|
|
|
13,256
|
|
|
-
|
Changes in assets and
liabilities:
|
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
|
(1,509,728)
|
|
|
(5,327,278)
|
|
|
(5,076,425)
|
Accounts receivable -
related parties, net
|
|
(1,103,104)
|
|
|
(1,427,078)
|
|
|
2,821,621
|
Notes
receivable
|
|
(356,648)
|
|
|
(7,276)
|
|
|
70,000
|
Inventories
|
|
(2,923,465)
|
|
|
(5,762,750)
|
|
|
(4,923,400)
|
Deferred cost of
revenue
|
|
117,910
|
|
|
383,382
|
|
|
(657,875)
|
Deferred cost of
revenue - related party
|
|
-
|
|
|
1,765,856
|
|
|
(1,795,222)
|
Advances to suppliers
and other current assets, net
|
|
(311,090)
|
|
|
(2,108,928)
|
|
|
(412,955)
|
Due from related
parties
|
|
-
|
|
|
-
|
|
|
703
|
Retentions
receivable, non-current
|
|
(397,157)
|
|
|
(358,505)
|
|
|
-
|
Deposit - related
party
|
|
10,134
|
|
|
(10,583)
|
|
|
-
|
Other non-current
assets
|
|
-
|
|
|
-
|
|
|
4,719
|
Accounts payable and
bank acceptance notes to vendors
|
|
2,839,752
|
|
|
996,619
|
|
|
2,577,192
|
Accounts payable -
related parties
|
|
1,896,054
|
|
|
3,269,238
|
|
|
248,695
|
Deferred
income
|
|
43,433
|
|
|
-
|
|
|
(26,639)
|
Advances from
customers
|
|
2,630,143
|
|
|
2,420,363
|
|
|
(220,483)
|
Advances from
customers - related parties
|
|
6,733,465
|
|
|
(125,099)
|
|
|
719,550
|
Due to related
parties
|
|
-
|
|
|
-
|
|
|
5,102
|
Deferred income,
non-current
|
|
43,433
|
|
|
-
|
|
|
-
|
Operating lease
liabilities
|
|
(76,752)
|
|
|
-
|
|
|
-
|
Income tax
payables
|
|
(404,231)
|
|
|
267,988
|
|
|
144,944
|
Accrued expenses and
other payables
|
|
(2,322,199)
|
|
|
(4,481,539)
|
|
|
589,638
|
Net cash provided
by (used in) operating activities
|
|
13,291,596
|
|
|
(2,456,777)
|
|
|
(3,189,701)
|
Cash flows from
investing activities
|
|
|
|
|
|
|
|
|
Cash paid for equity
investments
|
|
(3,015,119)
|
|
|
-
|
|
|
-
|
Purchase of property,
plant and equipment
|
|
(2,316,967)
|
|
|
(5,511,732)
|
|
|
(1,482,360)
|
Proceeds from
disposal of property, plant and equipment
|
|
427,261
|
|
|
22,072
|
|
|
-
|
Advances to third
party
|
|
-
|
|
|
-
|
|
|
(1,236,490)
|
Repayments from third
party
|
|
-
|
|
|
-
|
|
|
1,236,490
|
Repayments from
related parties
|
|
-
|
|
|
-
|
|
|
2,960
|
Deposit on
acquisition of subsidiary
|
|
-
|
|
|
(200,000)
|
|
|
-
|
Net cash used in
investing activities
|
|
(4,904,825)
|
|
|
(5,689,660)
|
|
|
(1,479,400)
|
Cash flows from
financing activities
|
|
|
|
|
|
|
|
|
Proceeds from
issuances of common shares
|
|
-
|
|
|
-
|
|
|
7,111,325
|
Repayment to related
parties
|
|
-
|
|
|
(9,703)
|
|
|
(739,973)
|
Deposit on loan
agreement
|
|
(503,939)
|
|
|
(473,698)
|
|
|
-
|
Proceeds from loans
due within one year
|
|
7,454,711
|
|
|
11,493,557
|
|
|
8,805,683
|
Repayment of loans
due within one year
|
|
(8,046,350)
|
|
|
(11,952,224)
|
|
|
(3,283,830)
|
Proceeds from
long-term loans
|
|
6,376,169
|
|
|
8,631,493
|
|
|
-
|
Payment of debt
issuance costs
|
|
(335,938)
|
|
|
(284,219)
|
|
|
-
|
Repayment of
long-term loans
|
|
(7,736,415)
|
|
|
(730,595)
|
|
|
-
|
Net cash provided
by (used in) financing activities
|
|
(2,791,762)
|
|
|
6,674,611
|
|
|
11,893,205
|
Effect of foreign
exchange rate changes on cash, cash equivalents and restricted
cash
|
|
(124,050)
|
|
|
(404,956)
|
|
|
222,973
|
Net change in
cash, cash equivalents and restricted cash
|
|
5,470,959
|
|
|
(1,876,782)
|
|
|
7,447,077
|
Cash, cash
equivalents and restricted cash, beginning of the
year
|
|
8,494,983
|
|
|
10,371,765
|
|
|
2,924,688
|
Cash, cash
equivalents and restricted cash, end of the year
|
$
|
13,965,942
|
|
$
|
8,494,983
|
|
$
|
10,371,765
|
|
|
|
|
|
|
|
|
|
Supplemental cash
flow information
|
|
|
|
|
|
|
|
|
Cash paid for
interest
|
$
|
608,431
|
|
$
|
689,867
|
|
$
|
244,753
|
Cash paid for income
taxes
|
$
|
977,755
|
|
$
|
1,507,489
|
|
$
|
656,602
|
|
|
|
|
|
|
|
|
|
Non-cash investing
and financing activities:
|
|
|
|
|
|
|
|
|
Properties acquired
with loans
|
$
|
-
|
|
$
|
52,161
|
|
$
|
206,000
|
Liabilities assumed
in connection with purchase of property, plant and
equipment
|
$
|
2,980,582
|
|
$
|
2,636,770
|
|
$
|
7,445,478
|
Operating expenses
paid by related parties
|
$
|
-
|
|
$
|
9,703
|
|
$
|
-
|
Property, plant and
equipment transferred from inventories
|
$
|
2,791,339
|
|
$
|
1,566,314
|
|
$
|
-
|
Reconciliation of
cash, cash equivalents and restricted cash to the consolidated
balance sheets
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
9,944,765
|
|
$
|
2,461,501
|
|
$
|
3,118,080
|
Restricted
cash
|
|
4,021,177
|
|
|
6,033,482
|
|
|
7,253,685
|
Total cash, cash
equivalents and restricted cash
|
$
|
13,965,942
|
|
$
|
8,494,983
|
|
$
|
10,371,765
|
View original
content:http://www.prnewswire.com/news-releases/newater-technology-inc-announces-year-2019-audited-financial-results-301071625.html
SOURCE Newater Technology, Inc.