-Teleconference to be Held on Wednesday, November 29, 2017 at 8:00 am
EST-
BEIJING, Nov. 28, 2017 /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 and nine
months ended September 30, 2017.
Highlights
- Net sales during the third quarter ended September 30, 2017 were RMB73.9 million or US$11.1
million, compared to RMB61.6
million during the same period in 2016, representing an
increase of RMB12.3 million or
20.0%.
- Sales of specialty films in the third quarter ended
September 30, 2017 were RMB28.5 million or US$4.3
million or 38.6% of our total revenues as compared to
RMB22.7 million or 36.8% in the same
period of 2016, which was an increase of RMB5.8 million, or 25.6% as compared to the same
period in 2016.
- Our gross profit was RMB6.7
million or US$1.0 million for
the third quarter ended September 30,
2017, representing a gross profit margin of 9.1%, as
compared to a gross profit margin of 1.7% for the same period in
2016.
- Basic and diluted net loss per share was RMB3.70 (US$0.56)
and RMB4.11 for the three-month
period ended September 30, 2017 and
2016, respectively.
Mr. Zengyong Wang, Chairman and CEO of Fuwei Films, commented,
"While we continue to face strong competition from emerging and
incumbent players in the marketplace, which has led to oversupply
relative to demand in the marketplace, we are encouraged by
positive trends in the increased net sales, especially the sales of
specialty films. We believe our commitment to innovation and
R&D has expanded our end-user applications that will enable the
Company to capitalize on these opportunities despite challenging
industry and economic conditions."
Third Quarter 2017 Results
Net sales during the third quarter ended September 30, 2017 were RMB73.9 million or US$11.1
million, compared to RMB61.6
million during the same period in 2016, representing an
increase of RMB12.3 million or 20.0%.
The increase of average sales price caused an increase of
RMB8.7 million and the sales volume
increase caused an increase of RMB3.6
million.
In the third quarter of 2017, sales of specialty films were
RMB28.5 million or US$4.3 million or 38.6% of our total revenues as
compared to RMB22.7 million or 36.8%
in the same period of 2016, which was an increase of RMB5.8 million, or 25.6% as compared to the same
period in 2016. The increase in average sales price caused an
increase of RMB0.1 million and the
increase in the sales volume caused an increase of RMB5.7 million.
The following is a breakdown of commodity and specialty film
sales (amounts in thousands):
|
Three-Month
Period
Ended
September 30, 2017
|
% of
Total
|
|
Three-Month
Period
Ended
September 30, 2016
|
% of
Total
|
|
RMB
|
US$
|
|
|
RMB
|
|
Stamping and
transfer film
|
29,588
|
4,447
|
40.0%
|
|
23,715
|
38.4%
|
Printing
film
|
7,068
|
1,062
|
9.6%
|
|
7,173
|
11.7%
|
Metallization
film
|
1,874
|
282
|
2.5%
|
|
1,634
|
2.7%
|
Specialty
film
|
28,487
|
4,282
|
38.6%
|
|
22,666
|
36.8%
|
Base film for other
application
|
6,839
|
1,028
|
9.3%
|
|
6,373
|
10.4%
|
|
|
|
|
|
|
|
|
73,857
|
11,101
|
100.0%
|
|
61,560
|
100.0%
|
Overseas sales were RMB15.2
million or US$2.3 million, or
20.6% of total revenues, compared with RMB11.4 million or 18.4% of total revenues in the
third quarter of 2016. This is an increase of RMB3.8 million. The increase in average sales
price caused an increase of RMB1.1
million and the increase in sales volume resulted in an
increase of RMB2.7 million.
The following is a breakdown of PRC domestic and overseas sales
(amounts in thousands):
|
|
Three-Month
Period
Ended
September 30, 2017
|
% of Total
|
Three-Month
Period
Ended
September 30, 2016
|
% of Total
|
|
|
RMB
|
US$
|
RMB
|
Sales in
China
|
|
58,614
|
8,810
|
79.4%
|
50,205
|
81.6%
|
Sales in other
countries
|
|
15,243
|
2,291
|
20.6%
|
11,355
|
18.4%
|
|
|
|
|
|
|
|
|
|
73,857
|
11,101
|
100.0%
|
61,560
|
100.0%
|
Our gross profit was RMB6.7
million or US$1.0 million for
the third quarter ended September 30,
2017, representing a gross profit margin of 9.1%, as
compared to a gross profit margin of 1.7% for the same period in
2016. Correspondingly, gross profit rate increased by 7.4
percentage point compared to the same period in 2016 mainly due to
the increase of average sales price.
Operating expenses for the third quarter ended September 30, 2017 were RMB16.3 million or US$2.5million, which was RMB3.6 million, or 28.3% higher than the same
period in 2016. This increase was mainly due to increased expenses
on research and development.
Net loss attributable to the Company during the third quarter
ended September 30, 2017 was
RMB12.1 million or US$1.8 million compared to net loss attributable
to the Company of RMB13.4 million
during the same period in 2016, representing a decrease in loss of
RMB1.3 million.
Basic and diluted net loss per share was RMB3.70 (US$0.56)
and RMB4.11 for the three-month
period ended September 30, 2017 and
2016, respectively.
Total shareholders' equity was RMB230.32
million or US$34.62 million as
of September 30, 2017, compared with
RMB265.21 million as of December 31, 2016.
As of September 30, 2017, the
Company had 3,265,837 basic and diluted total ordinary shares
outstanding.
Nine Months 2017 Results
Net sales during the nine-month period ended September 30, 2017 were RMB211.9 million or US$31.8 million, compared to RMB183.0 million, during the same period in 2016,
representing an increase of RMB28.9
million or 15.8%. The increase of average sales price caused
an increase of RMB21.3 million and
the increase in the sales volume caused an increase of RMB7.6 million.
In the nine-month period ended September
30, 2017, sales of specialty films were RMB75.8 million or US$11.4
million or 35.8% of our total revenues as compared to
RMB68.0 million or 37.1% in the same
period of 2016, which was an increase of RMB7.8 million, or 11.5% as compared to the same
period in 2016. The increase of average sales price caused an
increase of RMB0.1 million and the
increase in the sales volume caused an increase of RMB7.7 million.
Overseas sales during the nine months ended September 30, 2017 were RMB44.2 million or US$6.7
million, or 20.9% of total revenues, compared with
RMB35.1 million or 19.2% of total
revenues in the same period in 2016. This was RMB9.2 million higher than the same period in
2016. The increase in sales volume resulted in an increase of
RMB5.2 million and the increase of
average sales price caused an increase of RMB3.9 million.
The following is a breakdown of PRC domestic and overseas sales
(amounts in thousands):
|
|
Nine-Month Period
Ended
September 30, 2017
|
% of Total
|
Nine-Month Period
Ended
September 30, 2016
|
% of Total
|
|
|
RMB
|
US$
|
RMB
|
Sales in
China
|
|
167,622
|
25,193
|
79.1%
|
147,944
|
80.8%
|
Sales in other
countries
|
|
44,245
|
6,651
|
20.9%
|
35,079
|
19.2%
|
|
|
|
|
|
|
|
|
|
211,867
|
31,844
|
100.0%
|
183,023
|
100.0%
|
Our gross profit was RMB15.5
million or US$2.3 million for
the first nine months ended September 30,
2017, representing a gross profit margin of 7.3%, as
compared to a gross profit margin of 6.7% for the same period in
2016. Correspondingly, gross profit rate increased by 0.6
percentage points. Our average product sales prices increased by
11.2% compared to the same period last year while the average cost
of goods sold increased by 10.5% compared to the same period last
year. Consequently, the amount of increase in sales price was
higher than that in cost of goods sold during the nine months ended
September 30, 2017 compared with the
same period in 2016, which resulted in an increase in our gross
profit.
Operating expenses for the nine months ended September 30, 2017 were RMB44.3 million or US$6.7
million, compared to RMB42.2
million in the same period in 2016, which was RMB2.1 million or 5.0% higher than the same
period in 2016. This increase is mainly due to increased expenses
on research and development.
Conference Call Information
The Company will host a teleconference on Wednesday, November 29, 2017, at 8:00 a.m. EST / 9:00
p.m. Beijing time to
discuss the financial results. To participate in the call, please
dial +1-877-407-9205 in North
America, or +1-201-689-8054 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 +1-919-882-2331internationally, and entering the
following Conference ID: 22811. The replay will be available until
December 29, 2017, at 8:00 a.m. EST.
About Fuwei Films
Fuwei Films conducts its business through its wholly owned
subsidiary, Fuwei Films (Shandong)
Co., Ltd. ("Shandong Fuwei"). Shandong Fuwei develops, manufactures
and distributes high-quality plastic films using the biaxial
oriented stretch technique, otherwise known as BOPET film
(biaxially oriented polyethylene terephthalate). Fuwei'sBOPET 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 both the possible
delisting of the Company's ordinary shares from the NASDAQ Global
Market; significant competition in the BOPET film industry,
especially 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 adverse
impact 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
main importing countries; fluctuations of RMB exchange rate, the
reduce in demand for the Company's products or the loss of main
customers which may result in the decrease of sales, and negatively
influencing the Company's financial performance, uncertainty as to
the future profitability, uncertainty as to the Company's ability
to successfully obtain additional funds to meet the working capital
needs of the new BOPET production line, uncertainty as to the
Company's ability to continuously develop new BOPET film products
to be produced by the third production line and keep up with
changes in BOPET film technology, risks associated with possible
defects and errors in its products including complaints and claims
from clients, uncertainty as to its ability to protect and enforce
its intellectual property rights, uncertainty as to its ability to
attract and retain qualified executives and personnel, and
uncertainty in acquiring raw materials on time and on acceptable
terms, particularly in light of the volatility in the prices of
petroleum products in recent years, instability of power and energy
supply, and the uncertainty regarding the future operation of the
Company in connection with the changes in the labor law in
China, the measures taken by the
Chinese government to save energy and reduce emissions, and the
complaints from nearby residents and local government about the
noise caused by our production as well as the uncertainty of the
impact of major shareholder transfer that have substantial
influence over the Company and the Company's business operation
including possible overlap of our BOPET products, customers and
market orientation with an BOPET film manufacturer, which is
controlled by the same individual who has control over the shares
of our major shareholder. 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.:
Ms. Vivian Chen
Investor Relations
Citigate Dewe Rogerson
Phone: +1-646-284-9427
Email: vivian.chen@citigatedewerogerson.com
Financial Tables to Follow
FUWEI FILMS
(HOLDINGS) CO., LTD. AND SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER
30, 2017 AND DECEMBER 31, 2016
(amounts in thousands
except share and per share value)
(Unaudited)
|
|
|
September 30,
2017
|
|
December 31,
2016
|
|
RMB
|
US$
|
|
RMB
|
ASSETS
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
23,720
|
3,565
|
|
13,343
|
Restricted
cash
|
|
72,551
|
10,905
|
|
73,421
|
Accounts and bills
receivable, net
|
|
23,151
|
3,480
|
|
29,453
|
Inventories
|
|
21,419
|
3,219
|
|
25,153
|
Advance to
suppliers
|
|
11,634
|
1,749
|
|
6,043
|
Prepayments and other
receivables
|
|
1,696
|
255
|
|
6,489
|
Deferred tax assets –
current
|
|
1,298
|
195
|
|
1,199
|
Total current
assets
|
|
155,469
|
23,368
|
|
155,101
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
382,344
|
57,467
|
|
410,654
|
Construction in
progress
|
|
366
|
55
|
|
431
|
Lease prepayments,
net
|
|
16,963
|
2,550
|
|
17,358
|
Advance to suppliers
- long term, net
|
|
1,700
|
256
|
|
1,861
|
Deferred tax assets -
non current
|
|
7,926
|
1,191
|
|
8,032
|
|
|
|
|
|
|
Total
assets
|
|
564,768
|
84,887
|
|
593,437
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
Current
liabilities
|
|
|
|
|
|
Short-term
borrowings
|
|
65,000
|
9,770
|
|
60,000
|
Long-term loan,
current portion
|
|
1,625
|
244
|
|
3,300
|
Due to related
parties
|
|
134,413
|
20,202
|
|
131,747
|
Accounts
payables
|
|
19,544
|
2,937
|
|
20,581
|
Notes
payable
|
|
100,000
|
15,030
|
|
100,888
|
Advance from
customers
|
|
5,530
|
831
|
|
3,509
|
Accrued expenses and
other payables
|
5,507
|
828
|
|
5,204
|
Total current
liabilities
|
|
331,619
|
49,842
|
|
325,229
|
|
|
|
|
|
|
Deferred tax
liabilities
|
|
2,822
|
424
|
|
2,997
|
|
|
|
|
|
|
Total
liabilities
|
|
334,441
|
50,266
|
|
328,226
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
Registered capital(of
US$0.519008 par value; 5,000,000 shares authorized; 3,265,837
issued and outstanding)
|
|
13,323
|
2,002
|
|
13,323
|
Additional paid-in
capital
|
|
311,907
|
46,880
|
|
311,907
|
Statutory
reserve
|
|
37,441
|
5,627
|
|
37,441
|
Retained
earnings
|
|
(134,382)
|
(20,198)
|
|
(98,505)
|
Cumulative
translation adjustment
|
|
2,038
|
310
|
|
1,045
|
Total
shareholders' equity
|
|
230,327
|
34,621
|
|
265,211
|
Total
equity
|
|
230,327
|
34,621
|
|
265,211
|
Total liabilities
and equity
|
|
564,768
|
84,887
|
|
593,437
|
FUWEI FILMS
(HOLDINGS) CO., LTD. AND SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(LOSS)
|
FOR THE THREE- AND
NINE-MONTH PERIODS ENDED SEPTEMBER 30, 2017 AND 2016
|
(amounts in thousands
except share and per share value)
|
(Unaudited)
|
|
|
The Three-Month
Period Ended September 30,
|
|
The Nine-Month
Period Ended September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
RMB
|
US$
|
|
RMB
|
|
RMB
|
US$
|
|
RMB
|
Net
sales
|
73,857
|
11,101
|
|
61,560
|
|
211,867
|
31,844
|
|
183,023
|
Cost of
sales
|
67,145
|
10,092
|
|
60,504
|
|
196,373
|
29,515
|
|
170,752
|
|
|
|
|
|
|
|
|
|
|
Gross profit
(loss)
|
6,712
|
1,009
|
|
1,056
|
|
15,494
|
2,329
|
|
12,271
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
Selling
expenses
|
3,410
|
513
|
|
3,193
|
|
10,617
|
1,596
|
|
9,482
|
Administrative
expenses
|
12,917
|
1,941
|
|
9,497
|
|
33,669
|
5,060
|
|
32,694
|
Total operating
expenses
|
16,327
|
2,454
|
|
12,690
|
|
44,286
|
6,656
|
|
42,176
|
|
|
|
|
|
|
|
|
|
|
Operating
loss
|
(9,615)
|
(1,445)
|
|
(11,634)
|
|
(28,792)
|
(4,327)
|
|
(29,905)
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
|
- Interest
income
|
103
|
16
|
|
200
|
|
607
|
91
|
|
552
|
- Interest
expense
|
(2,244)
|
(337)
|
|
(2,030)
|
|
(7,097)
|
(1,067)
|
|
(5,491)
|
- Others income
(expense), net
|
(374)
|
(56)
|
|
26
|
|
(763)
|
(115)
|
|
(1,328)
|
|
|
|
|
|
|
|
|
|
|
Total other
expense
|
(2,515)
|
(377)
|
|
(1,804)
|
|
(7,253)
|
(1,091)
|
|
(6,267)
|
|
|
|
|
|
|
|
|
|
|
Loss before provision
for income taxes
|
(12,130)
|
(1,822)
|
|
(13,438)
|
|
(36,045)
|
(5,418)
|
|
(36,172)
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit
(expense)
|
54
|
8
|
|
10
|
|
168
|
25
|
|
492
|
|
|
|
|
|
|
|
|
|
|
Net
loss
|
(12,076)
|
(1,814)
|
|
(13,428)
|
|
(35,877)
|
(5,393)
|
|
(35,680)
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to noncontrolling interests
|
-
|
-
|
|
-
|
|
-
|
-
|
|
-
|
Net loss attributable
to the Company
|
(12,076)
|
(1,814)
|
|
(13,428)
|
|
(35,877)
|
(5,393)
|
|
(35,680)
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss)
|
|
|
|
|
|
|
|
|
|
- Foreign currency
translation adjustments attributable to noncontrolling
interest
|
-
|
-
|
|
(2)
|
|
-
|
-
|
|
(24)
|
- Foreign currency
translation adjustments attributable to the Company
|
1,206
|
181
|
|
(9)
|
|
993
|
149
|
|
(88)
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss
attributable to non-controlling interest
|
-
|
-
|
|
(2)
|
|
-
|
-
|
|
(24)
|
Comprehensive loss
attributable to the Company
|
(10,870)
|
(1,633)
|
|
(13,437)
|
|
(34,884)
|
(5,244)
|
|
(35,768)
|
|
|
|
|
|
|
|
|
|
|
Loss per share, Basic
and diluted
|
(3.70)
|
(0.56)
|
|
(4.11)
|
|
(10.99)
|
(1.65)
|
|
(10.93)
|
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, 2017 AND 2016
(amounts in thousands
except share and per share value)
(Unaudited)
|
|
|
|
The Nine-Month
Period Ended September 30,
|
|
|
2017
|
|
2016
|
|
|
RMB
|
US$
|
|
RMB
|
Cash flow from
operating activities
|
|
|
|
|
|
Net loss
|
|
(35,877)
|
(5,392)
|
|
(35,680)
|
Adjustments to
reconcile net loss to net cash used in operating
activities
|
|
|
|
|
|
- Depreciation of
property, plant and equipment
|
|
32,334
|
4,860
|
|
32,122
|
- Amortization of
intangible assets
|
|
394
|
59
|
|
393
|
- Deferred income
taxes
|
|
(168)
|
(25)
|
|
(492)
|
- Bad debt (recovery)
expense
|
|
714
|
107
|
|
1,670
|
-Inventory
provision
|
|
(57)
|
(9)
|
|
(226)
|
Changes in operating
assets and liabilities
|
|
|
|
|
|
- Accounts and bills
receivable
|
|
5,589
|
840
|
|
(14,219)
|
-
Inventories
|
|
3,790
|
570
|
|
2,968
|
- Advance to
suppliers
|
|
(5,591)
|
(840)
|
|
(2,580)
|
- Prepaid expenses and
other current assets
|
|
100
|
15
|
|
79
|
- Accounts
payable
|
|
(1,037)
|
(157)
|
|
540
|
- Accrued expenses and
other payables
|
|
354
|
53
|
|
(1,450)
|
- Advance from
customers
|
|
2,021
|
304
|
|
370
|
- Tax
payable
|
|
4,693
|
705
|
|
10,952
|
|
|
|
|
|
|
Net cash provided by
(used in) operating activities
|
|
7,259
|
1,090
|
|
(5,553)
|
|
|
|
|
|
|
Cash flow from
investing activities
|
|
|
|
|
|
Purchases of
property, plant and equipment
|
|
(4,024)
|
(605)
|
|
(11,064)
|
Restricted cash
related to trade finance
|
|
871
|
131
|
|
(27,521)
|
Advance to suppliers
- non current
|
|
161
|
24
|
|
(478)
|
Amount change in
construction in progress
|
|
65
|
10
|
|
1,293
|
|
|
|
|
|
|
Net cash used in
investing activities
|
|
(2,927)
|
(440)
|
|
(37,770)
|
|
|
|
|
|
|
Cash flow from
financing activities
|
|
|
|
|
|
Principal payments of
bank loans
|
|
(1,675)
|
(252)
|
|
(1,675)
|
Proceeds from
short-term bank loans
|
|
5,000
|
752
|
|
45,000
|
Proceeds from related
party
|
|
2,666
|
401
|
|
(22,401)
|
Payment of capital
lease obligation
|
|
-
|
-
|
|
(302)
|
Change in notes
payable
|
|
(888)
|
(133)
|
|
24,053
|
|
|
|
|
|
|
Net cash provided by
financing activities
|
|
5,103
|
768
|
|
44,675
|
|
|
|
|
|
|
Effect of foreign
exchange rate changes
|
|
942
|
225
|
|
(28)
|
|
|
|
|
|
|
Net increase in cash
and cash equivalent
|
|
10,377
|
1,643
|
|
1,324
|
|
|
|
|
|
|
Cash and cash
equivalent
|
|
|
|
|
|
At beginning of
period/year
|
|
13,343
|
1,922
|
|
14,355
|
At end of
period/year
|
|
23,720
|
3,566
|
|
15,679
|
|
|
|
|
|
|
SUPPLEMENTARY
DISCLOSURE:
|
|
|
|
|
|
Interest
paid
|
|
7,097
|
1,067
|
|
5,491
|
Income tax
paid
|
|
-
|
-
|
|
-
|
|
|
|
|
|
|
SUPPLEMENTARY
SCHEDULE OF NONCASH INVESTING AND FINANCIAL
ACTIVITIES:
|
Account payable for
plant and equipment:
|
|
2,040
|
307
|
|
2,172
|
Obligations for
acquired equipment under capital lease:
|
|
-
|
-
|
|
-
|
View original
content:http://www.prnewswire.com/news-releases/fuwei-films-announces-its-unaudited-financial-results-for-the-third-quarter-of-2017-300561994.html
SOURCE Fuwei Films (Holdings) Co., Ltd.