Company to Host Earnings Conference Call on Friday, November 9, 2018, at 8:00 am ET
BAODING, China,
Nov. 8, 2018
/PRNewswire/ -- IT Tech Packaging, Inc. (NYSE MKT: ITP) ("IT
Tech Packaging" or the "Company"), a leading manufacturer and
distributor of diversified paper products in North China, today announced its unaudited
financial results for the third quarter ended September 30, 2018.
- Revenue for the third quarter of 2018 decreased by 20.2% to
$26.72 million, primarily
attributable to a decrease in overall sales volume of 23.8% and
partially offset by an increase in average selling prices ("ASP")
of 4.7%.
- Gross profit for the third quarter of 2018 decreased by 82.6%
to $1.26 million. Gross margin
decreased by 16.8 percentage points to 4.7%. The decreases in gross
profit and gross margin were primarily due to increases in unit
costs of recycled paper board and recycled white scrap paper.
- Net loss for the third quarter of 2018 was $1.40 million, or net loss of $0.07 per diluted share, compared to net income
of $1.57 million, or net earnings of
$0.07 per diluted share, for the same
period of the prior year.
- Earnings before interest, taxes, depreciation and amortization
("EBITDA") for the third quarter of 2018 decreased by 70.7% to
$1.89 million.
Mr. Zhenyong Liu, Chairman and
Chief Executive Officer of the Company, commented, "with decreases
in both revenues and margins, our third quarter results highlighted
continued challenges facing our business. With China's GDP
registered the slowest growth rate since the first quarter of 2009,
the continuing slowdown of China's
growth momentum clearly took a toll on paper companies including us
during the third quarter. Looking ahead, with the ongoing trade war
between China and the U.S. as well
as heightened government efforts on environmental protection, the
paper industry faces significant risks and uncertainties, and, as a
result, our financial performance could be volatile in the near
term."
Third Quarter 2018
Unaudited Financial Results
|
|
|
|
For the
Three Months Ended September 30,
|
($
millions)
|
|
2018
|
|
2017
|
|
%
Change
|
Revenues
|
|
26.72
|
|
33.51
|
|
-20.2%
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
19.22
|
|
22.40
|
|
-14.2%
|
Light-Weight
CMP**
|
|
6.85
|
|
5.00
|
|
37.1%
|
Offset Printing
Paper
|
|
0.66
|
|
5.45
|
|
-88.0%
|
Tissue Paper
Products
|
|
0.00
|
|
0.66
|
|
-100.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
1.26
|
|
7.22
|
|
-82.6%
|
Gross profit
(loss) margin
|
|
4.7%
|
|
21.6%
|
|
-16.8 pp
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
4.9%
|
|
22.5%
|
|
-17.6 pp
|
Light-Weight
CMP**
|
|
5.1%
|
|
25.8%
|
|
-20.8 pp
|
Offset Printing
Paper
|
|
-3.3%
|
|
15.6%
|
|
-18.9 pp
|
Tissue Paper
Products
|
|
NA
|
|
6.7%
|
|
NM
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income (loss)
|
|
-1.57
|
|
2.72
|
|
-157.7%
|
Net income
(loss)
|
|
-1.40
|
|
1.57
|
|
-189.4%
|
EBITDA
|
|
1.89
|
|
6.45
|
|
-70.7%
|
Basic and
Diluted earnings (loss) per share
|
|
-0.07
|
|
0.07
|
|
-189.4%
|
|
|
|
|
|
|
|
* Products
from PM6
|
|
|
|
|
|
|
** Products
from PM1
|
|
|
|
|
|
|
*** pp
represents percentage points
|
|
|
|
|
|
|
Revenue
For the third quarter of 2018, total revenue decreased by
$6.78 million, or 20.2%, to
$26.72 million from $33.51 million for the same period of the prior
year. The decrease in total revenue was mainly due to the decrease
in sales volume across the board and partially offset the increase
in ASP. The following table summarizes revenue, volume and ASP by
product for the third quarter of 2018 and 2017, respectively:
|
For the
Three Months Ended September 30,
|
|
2018
|
|
2017
|
|
Revenue
($'000)
|
|
Volume
(tonne)
|
|
ASP
($/tonne)
|
|
Revenue
($'000)
|
|
Volume
(tonne)
|
|
ASP
($/tonne)
|
Regular
CMP
|
19,219
|
|
33,928
|
|
566
|
|
22,397
|
|
43,202
|
|
518
|
Light-Weight
CMP
|
6,850
|
|
12,319
|
|
556
|
|
4,996
|
|
10,173
|
|
491
|
Offset Printing
Paper
|
656
|
|
902
|
|
727
|
|
5,454
|
|
8,035
|
|
679
|
Tissue Paper
Products
|
-
|
|
-
|
|
-
|
|
660
|
|
493
|
|
1,339
|
Total
|
26,724
|
|
47,149
|
|
567
|
|
33,507
|
|
61,903
|
|
541
|
Revenue from CMP, including both regular CMP and light-Weight
CMP, decreased by $1.32 million, or
4.8%, to $26.07 million and accounted
for 97.6 % of total revenue for the third quarter of 2018, compared
to $27.39 million, or 81.8% of total
revenue, for the same period of the prior year. The Company sold
46,247 tonnes of CMP at an ASP of $564/tonne in the third quarter of 2018, compared
to 53,375 tonnes at an ASP of $513/tonne in the same period of the prior
year.
Of the total CMP sales, revenue from regular CMP decreased by
$3.18 million, or 14.2%, to
$19.22 million, resulting from sales
of 33,928 tonnes at an ASP of $566/tonne, during the third quarter of 2018,
compared to revenue of $22.40
million, resulting from sales of 43,202 tonnes at an ASP of
$518/tonne, for the same period of
the prior year. Revenue from light-weight CMP increased by
$1.85 million, or 37.1%, to
$6.85 million, resulting from sales
of 12,319 tonnes at an ASP of $556/tonne for the third quarter of 2018,
compared to revenue of $5.00 million,
resulting from sales of 10,173 tonnes at an ASP of $491/tonne for the same period of the prior
year.
Revenue from offset printing paper decreased by $4.80 million, or 88.0%, to $0.66 million for the third quarter of 2018, from
$5.45 million for the same period of
the prior year. The Company sold 902 tonnes of offset printing
paper at an ASP of $727/tonne in the
third quarter of 2018, compared to 8,035 tonnes at an ASP of
$679/tonne in the same period of the
prior year.
Production of tissue paper was suspended in September and
October 2017 for the replacement of
coal boilers, and intermittent production resumed in the following
months due to volatility in the price of tissue paper. We had no
revenue from tissue paper products for the third quarter of 2018,
compared to $0.66 million, resulting
from sales of 493 tonnes at an ASP of $1,339/tonne, for the third quarter of 2017. We
expect to resume and increase production of tissue products once
the market condition becomes more favorable.
In June 2016, we suspended the
production of digital photo paper due to low market demand for our
products and now are considering renovating the line to produce
more competitive products. We expect that our digital photo paper
production will remain suspended for the near future.
Gross Profit and Gross Margin
Total cost of sales decreased by $0.82
million, or 3.1%, to $25.46
million for the third quarter of 2018, from $26.29 million for the same period of the prior
year. Cost of sales per tonne was $540 for the third quarter of 2018, compared to
$425 for the same period of the prior
year. The increase in overall cost of sales per tonne was mainly
due to increased material costs, specifically higher average unit
purchase costs of recycled paper board and recycled white scrap
paper. Costs of sales per tonne for regular CMP, light-weight CMP,
offset printing paper, and tissue paper products were, $539, $528,
$751, and $nil, respectively, for the
third quarter of 2018, compared to $402, $364,
$573 and $1,249, respectively, for the same period of the
prior year.
Gross profit decreased by $5.96
million, or 82.6%, to $1.26
million for the third quarter of 2018, from $7.22 million for the same period of the prior
year. Overall gross margin was 4.7% for the third quarter of 2018,
compared to 21.6% for the same period of the prior year. The
decrease in gross profit and gross margin were mainly due to the
increase in unit cost of recycled paper board and recycled white
scrap paper and decrease in overall sales volume, partially offset
by an increase in average selling prices as discussed above. Gross
margins for regular CMP, light-weight CMP, offset printing paper,
and tissue paper products were 4.9%, 5.1%, -3.3%, and nil,
respectively, for the third quarter of 2018, compared to gross
profit margin of 22.5%, 25.8%, 15.6%, and 6.7%, respectively, for
the same period of the prior year.
Selling, General and Administrative Expenses
Selling, general and administrative expenses ("SG&A")
decreased by $0.02 million, or 0.7%,
to $2.83 million for the third
quarter of 2018 from $2.85 million
for the same period of the prior year. As a percentage of total
revenue, SG&A was 10.6% for the third quarter of 2018, compared
to 8.5% for the same period of the prior year.
Income (loss) from Operations
Loss from operations was $1.57
million for the third quarter of 2018, compared to income
from operations of $2.72 million for
the same period of the prior year. The decrease in operating income
was primarily due to the decrease in gross profit as discussed
above. Operating loss margin was 5.9% for the third quarter of
2018, compare to operating profit margin of 8.1% for the same
period of the prior year.
Net Income (loss)
Net loss was $1.40 million, or net
loss of $0.07 per basic and diluted
share, for the third quarter of 2018, compared to net income of
$1.57 million, or net earnings of
$0.07 per basic and diluted share,
for the same period of the prior year.
EBITDA
EBITDA was $1.89 million for the
third quarter of 2018, compared to $6.45
million for the same period of the prior year.
Note 1: Non-GAAP Financial Measures
In addition to our U.S. GAAP results, this press release
includes a discussion of EBITDA, a non-GAAP financial measure as
defined by the Securities and Exchange Commission ("SEC"). The
Company defines EBITDA as net income before interest, income taxes,
depreciation and amortization. EBITDA is a key measure used by
management to evaluate our results and make strategic decisions.
Management believes this measure is useful to investors because it
is an indicator of operational performance. Because not all
companies use identical calculations, the Company's presentation of
EBITDA may not be comparable to similarly titled measures of other
companies, and should not be viewed as an alternative to measures
of financial performance or changes in cash flows calculated in
accordance with the U.S. GAAP.
Reconciliation of
Net Income to EBITDA
|
(Amounts expressed
in US$)
|
|
|
|
For the
Three Months Ended September 30,
|
($
millions)
|
|
2018
|
|
|
2017
|
Net income
(loss)
|
|
-1.40
|
|
|
1.57
|
Add: Income
tax
|
|
-0.54
|
|
|
0.51
|
Net
interest expense
|
|
0.37
|
|
|
0.65
|
Depreciation and amortization
|
|
3.46
|
|
|
3.73
|
EBITDA
|
|
1.89
|
|
|
6.45
|
Nine Months Ended
September 30, 2018 Financial Results
|
|
|
|
For the Nine
Months Ended September 30,
|
($
millions)
|
|
2018
|
|
2017
|
|
%
Change
|
Revenues
|
|
61.75
|
|
81.58
|
|
-24.3%
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
43.43
|
|
55.74
|
|
-22.1%
|
Light-Weight
CMP**
|
|
13.10
|
|
10.45
|
|
25.4%
|
Offset Printing
Paper
|
|
5.21
|
|
13.31
|
|
-60.8%
|
Tissue Paper
Products
|
|
0.00
|
|
2.09
|
|
-100.0%
|
Digital Photo
Paper
|
|
0.01
|
|
0.00
|
|
NM
|
|
|
|
|
|
|
|
Gross
profit
|
|
3.6
|
|
16.3
|
|
-78.1%
|
Gross
margin
|
|
5.8%
|
|
20.0%
|
|
-14.2 pp
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
6.6%
|
|
20.5%
|
|
-13.9 pp
|
Light-Weight
CMP**
|
|
5.1%
|
|
23.3%
|
|
-18.2 pp
|
Offset Printing
Paper
|
|
0.8%
|
|
17.7%
|
|
-16.8 pp
|
Tissue Paper
Products
|
|
NA
|
|
6.5%
|
|
NM
|
Digital Photo
Paper
|
|
-24.4%
|
|
NA
|
|
NM
|
|
|
|
|
|
|
|
Operating
income (loss)
|
|
-6.1
|
|
6.4
|
|
-196.0%
|
Net income
(loss)
|
|
-5.4
|
|
3.3
|
|
-263.3%
|
EBITDA
|
|
5.0
|
|
17.4
|
|
-70.9%
|
Basic and
Diluted earnings per share
|
|
-0.25
|
|
0.15
|
|
-266.7%
|
|
|
|
|
|
|
|
* Products
from PM6
|
|
|
|
|
|
|
** Products
from PM1
|
|
|
|
|
|
|
*** pp
represents percentage points
|
|
|
|
|
|
|
Revenue
For the nine months ended September 30,
2018, total revenue decreased by $19.82 million, or 24.3%, to $61.76 million from $81.58
million for the same period of the prior year. The decrease
in total revenue was mainly the decreases in sales volume and
partially offset by the increase in ASP across the board. The
following table summarizes revenue, volume and ASP by product for
the nine months ended September 30,
2018 and 2017, respectively:
|
For the Nine
Months Ended September 30,
|
|
2018
|
|
2017
|
|
Revenue
($'000)
|
|
Volume
(tonne)
|
|
ASP
($/tonne)
|
|
Revenue
($'000)
|
|
Volume
(tonne)
|
|
ASP
($/tonne)
|
Regular
CMP
|
43,434
|
|
74,141
|
|
586
|
|
55,741
|
|
128,988
|
|
432
|
Light-Weight
CMP
|
13,101
|
|
23,114
|
|
567
|
|
10,449
|
|
24,396
|
|
428
|
Offset Printing
Paper
|
5,212
|
|
6,191
|
|
842
|
|
13,307
|
|
20,098
|
|
662
|
Tissue Paper
Products
|
-
|
|
-
|
|
-
|
|
2,087
|
|
1,619
|
|
1,289
|
Digital Photo
Paper
|
14
|
|
-
|
|
NM
|
|
-
|
|
-
|
|
-
|
Total
|
61,761
|
|
103,446
|
|
597
|
|
81,584
|
|
175,101
|
|
466
|
Revenue from CMP, including both regular CMP and light-Weight
CMP decreased by $9.66 million, or
14.6%, to $56.54 million, and
accounted for 91.6 % of total revenue for the nine months ended
September 30, 2018, compared to
$66.19 million, or 81.1% of total
revenue for the same period of the prior year. The Company sold
97,255 tonnes of CMP in the nine months ended September 30, 2018, compared to 153,384 tonnes of
CMP in the same period of the prior year.
Of the total CMP sales, revenue from regular CMP decreased by
$12.31 million, or 22.1%, to
$43.43 million, resulting from sales
of 74,141 tonnes at an ASP of $586/tonne during the nine months ended
September 30, 2018 , compared to
revenue of $55.74 million, resulting
from sales of 128,988 tonnes at an ASP of $432/tonne for the same period of the prior year.
Revenue from light-weight CMP increased by $2.65 million, or 25.4%, to $13.10 million, resulting from sales of 23,144
tonnes at an ASP of $567/tonne for
the nine months ended September 30,
2018, compared to revenue of $10.45
million, resulting from sales of 24,296 tonnes at an ASP of
$428/tonne for the same period of the
prior year
Revenue from offset printing paper decreased by $8.09 million, or 60.8%, to $5.21 million for the nine months ended
September 30, 2018, from $13.31 million for the same period of the prior
year. The Company sold 6,191 tonnes of offset printing paper at an
ASP of $842/tonne in the nine months
ended September 30, 2018, compared to
20,098 tonnes at an ASP of $662/tonne
in the same period of the prior year.
Production of tissue paper was suspended in September and
October 2017 for the replacement of
coal boilers, and intermittent production resumed in the following
months due to volatility in the price of tissue paper. We had no
revenue from tissue paper products for the nine months ended
September 30, 2018, compared to
$2.09 million, resulting from sales
of 1,619 tonnes at an ASP of $1,289/tonne, for the same period of the prior
year. We expect to resume and increase production of tissue
products once the market condition becomes more favorable.
Revenue generated from digital photo paper were $13,822 for the nine months ended September 30, 2018. In June 2016, we suspended the production of digital
photo paper due to low market demand for our products and now are
upgrading the production line to produce more competitive products.
We expect that our digital photo paper production will remain
suspended for the near future.
Gross Profit and Gross Margin
Total cost of sales decreased by $7.08
million, or 10.9 %, to $58.16
million for the nine months ended September 30, 2018, from $65.24 million for the same period of the prior
year. The decrease in overall cost of sales was mainly a result of
decrease in sales volume, partially offset by increase of cost of
recycled paper board and recycled white scrap paper. Costs of sales
per tonne for regular CMP, light-weight CMP, offset printing paper,
and tissue paper products were $547,
$538, $835, and $nil, respectively, for the nine months
ended September 30, 2018, compared to
$344, $328, $545, and
$1,205, respectively, for the same
period of the prior year.
Total gross profit decreased by $12.76
million, or 78.1%, to $3.58
million for the nine months ended September 30, 2018, from $16.34 million for the same period of the prior
year. Overall gross margin was 5.8% for the nine months ended
September 30, 2018, compared to 20.0%
for the same period of the prior year. Gross margin for regular
CMP, light-weight CMP, offset printing paper and tissue paper
products was 6.6%, 5.1%, 0.8%, and nil, respectively, for the nine
months ended September 30, 2018,
compared to 20.5%, 23.3%, 17.7%, and 6.5%, respectively, for the
same period of the prior year.
Selling, General and Administrative Expenses
SG&A increased by $1.35
million, or 16.2%, to $9.67
million for the nine months ended September 30, 2018, from $8.32 million for the same period of the prior
year. As a percentage of total revenue, SG&A was 15.7% for the
nine months ended September 30, 2018,
compared to 10.2% for the same period of the prior year.
Income (loss) from Operations
Loss from operations was $6.10
million for the nine months ended September 30, 2018, compared to income from
operations of $6.36 million for the
same period of the prior year. Operating loss margin was 9.9% for
the nine months ended September 30,
2018, compared to operating profit margin of 7.8% for the
same period of the prior year.
Net Income (loss)
Net loss was $5.38 million, or net
loss of $0.25 per basic and diluted
share, for the nine months ended September
30, 2018, compared to net income of $3.30 million, or net earnings of $0.15 per basic and diluted share, for the same
period of the prior year.
EBITDA
EBITDA decreased by $12.31
million, or 70.9%, to $5.05
million for the nine months ended September 30, 2018 from $17.35 million for the same period of the prior
year.
Note 1: Non-GAAP Financial Measures
In addition to our U.S. GAAP results, this press release
includes a discussion of EBITDA, a non-GAAP financial measure as
defined by the Securities and Exchange Commission ("SEC"). The
Company defines EBITDA as net income before interest, income taxes,
depreciation and amortization. EBITDA is a key measure used by
management to evaluate our results and make strategic decisions.
Management believes this measure is useful to investors because it
is an indicator of operational performance. Because not all
companies use identical calculations, the Company's presentation of
EBITDA may not be comparable to similarly titled measures of other
companies, and should not be viewed as an alternative to measures
of financial performance or changes in cash flows calculated in
accordance with the U.S. GAAP.
Reconciliation of
Net Income to EBITDA
|
(Amounts expressed
in US$)
|
|
|
|
For the Nine
Months Ended September 30,
|
($
millions)
|
|
2018
|
|
|
2017
|
Net income
(loss)
|
|
-5.38
|
|
|
3.30
|
Add: Income
tax
|
|
-1.63
|
|
|
1.11
|
Net
interest expense
|
|
1.18
|
|
|
2.02
|
Depreciation and amortization
|
|
10.87
|
|
|
10.93
|
EBITDA
|
|
5.05
|
|
|
17.35
|
Cash, Liquidity and Financial Position
As of September 30, 2018, the
Company had cash and bank balances, short-term debt (including bank
loans, current portion of long-term loans from credit union and
related party loans), notes payable and long-term debt (including
related party loans) of $5.47
million, $15.53 million,
$3.63 million and $9.39 million, respectively, compared to
$2.90 million, $13.56 million, $6.12
million and $11.91 million,
respectively, at the end of 2017. Net accounts receivable was
$1.22 million as of September 30, 2018, compared to $1.84 million as of December 31, 2017. Net inventory was $4.66 million as of September 30, 2018, compared to $8.47 million at the end of 2017. As of
September 30, 2018, the Company had
current assets of $19.02 million and
current liabilities of $20.79
million, resulting in a working capital deficit of
$1.77 million. This compared to
current assets of $19.99 million,
current liabilities of $21.76 million
and working capital deficit of $1.77
million at the end of 2017.
Net cash provided by operating activities was $1.81 million for the nine months ended
September 30, 2018, compared to
$16.84 million for the same period of
the prior year. Net cash used in investing activities was
$1.81 million for the nine months
ended September 30, 2018, compared to
$7.57 million for the same period of
the prior year. Net cash provided by financing activities was
$0.76 million for the nine months
ended September 30, 2018, compared to
net cash used in financing activities of $1.76 million for the same period of the prior
year.
Corporate Name and Ticker Symbol Changes
On August 1, 2018, the Company
changed its corporate name to IT Tech Packaging, Inc., with the
ticker symbol "ITP".
Earnings Conference Call
To attend the conference call, please dial in using the
information below. When prompted upon dialing-in, please provide
the conference ID or ask for the "IT Tech Packaging Third Quarter
2018 Earnings Conference Call."
Date:
|
Friday, November 9,
2018
|
Time:
|
8:00 am ET
|
International Toll
Free:
|
United States:
+1-855-500-8701
Mainland China:
400-120-0654
Hong Kong:
800-906-606
International:
+65-6713-5440
|
Conference
ID:
|
7478584
|
This conference call will be broadcast live on the Internet and
can be accessed by all interested parties at
https://edge.media-server.com/m6/p/yyayqega .
Please access the link at least fifteen minutes prior to the
start of the call to register, download, and install any necessary
audio software.
A playback will be available through 11:00 am ET on November 9,
2018 to 7:59 am ET on
November 17, 2018. To listen, please
dial+1-855-452-5696 if calling from the
United States, or +61-290-034-211 if calling
internationally. Use the passcode 7478584 to access the replay.
About IT Tech Packaging, Inc.
Founded in 1996, IT Tech Packaging, Inc. ("ITP") is a leading
manufacturer and distributor of diversified paper products in
North China. Using recycled paper
as its primary raw material (with the exception of its tissue paper
products), ITP produces and distributes three categories of paper
products: corrugating medium paper, offset printing paper and
tissue paper products. With production based in Baoding and Xingtai
in North China's Hebei Province, ITP is located strategically
close to the Beijing and
Tianjin region, home to a growing
base of industrial and manufacturing activities and one of the
largest markets for paper products consumption in the country. ITP
has been listed on the NYSE MKT since December 2009.
Safe Harbor Statements
This press release may contain forward-looking statements.
These forward-looking statements involve inherent risks and
uncertainties that could cause actual results to differ materially
from those projected or anticipated, including risks outlined in
the Company's public filings with the Securities and Exchange
Commission, including the Company's latest annual report on Form
10-K. All information provided in this press release speaks as of
the date hereof. Except as otherwise required by law, the Company
undertakes no obligation to update or revise its forward-looking
statements.
For more information, please contact:
At the Company
Email: ir@itpackaging.cn
Investor Relations:
Tony
Tian,
CFA
Weitian Group LLC
Email: ttian@weitianco.com
Phone: +1-732-910-9692
IT TECH PACKAGING,
INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
AS OF SEPTEMBER
30, 2018 AND DECEMBER 31, 2017
|
(Unaudited)
|
|
|
|
September 30,
|
|
|
December
31,
|
|
|
|
2018
|
|
|
2017
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
Cash and bank
balances
|
|
$
|
5,468,315
|
|
|
$
|
2,895,790
|
|
Restricted
cash
|
|
|
3,634,144
|
|
|
|
6,121,637
|
|
Accounts receivable
(net of allowance for doubtful accounts of $24,863 and $37,626
as of September 30, 2018 and December 2017,
respectively)
|
|
|
1,218,291
|
|
|
|
1,843,682
|
|
Inventories
|
|
|
4,663,053
|
|
|
|
8,474,165
|
|
Prepayments and other
current assets
|
|
|
4,037,371
|
|
|
|
651,523
|
|
|
|
|
|
|
|
|
|
|
Total current
assets
|
|
|
19,021,174
|
|
|
|
19,986,797
|
|
|
|
|
|
|
|
|
|
|
Property, plant, and
equipment, net
|
|
|
171,269,284
|
|
|
|
189,388,709
|
|
Value-added tax
recoverable
|
|
|
2,824,155
|
|
|
|
3,041,416
|
|
Deferred tax asset
non-current
|
|
|
7,791,811
|
|
|
|
6,572,559
|
|
|
|
|
|
|
|
|
|
|
Total
Assets
|
|
$
|
200,906,424
|
|
|
$
|
218,989,481
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
|
|
Short-term bank
loans
|
|
$
|
11,919,991
|
|
|
$
|
7,192,923
|
|
Current portion of
long-term loans from credit union
|
|
|
3,605,070
|
|
|
|
6,366,502
|
|
Accounts
payable
|
|
|
64,410
|
|
|
|
422,705
|
|
Notes
payable
|
|
|
3,634,144
|
|
|
|
6,121,637
|
|
Due to related
parties
|
|
|
319,400
|
|
|
|
60,378
|
|
Accrued payroll and
employee benefits
|
|
|
185,987
|
|
|
|
231,247
|
|
Other payables and
accrued liabilities
|
|
|
1,064,788
|
|
|
|
836,337
|
|
Income taxes
payable
|
|
|
-
|
|
|
|
525,804
|
|
|
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
|
20,793,790
|
|
|
|
21,757,533
|
|
|
|
|
|
|
|
|
|
|
Loans from credit
union
|
|
|
3,575,997
|
|
|
|
1,193,719
|
|
Loans from a related
party
|
|
|
5,814,630
|
|
|
|
10,712,865
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
(including amounts of the consolidated VIE without recourse to
the
Company of $24,154,428 and $31,235,520 as of September 30, 2018 and
2017, respectively)
|
|
|
30,184,417
|
|
|
|
33,664,117
|
|
|
|
|
|
|
|
|
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity
|
|
|
|
|
|
|
|
|
Common stock,
500,000,000 shares authorized, $0.001 par value per share,
21,450,316 shares issued and outstanding as of September 30, 2018
and 2017, respectively
|
|
|
21,450
|
|
|
|
21,450
|
|
Additional paid-in
capital
|
|
|
50,635,243
|
|
|
|
50,635,243
|
|
Statutory earnings
reserve
|
|
|
6,080,574
|
|
|
|
6,080,574
|
|
Accumulated other
comprehensive (loss) income
|
|
|
(3,753,314)
|
|
|
|
5,468,799
|
|
Retained
earnings
|
|
|
117,738,054
|
|
|
|
123,119,298
|
|
|
|
|
|
|
|
|
|
|
Total
stockholders' equity
|
|
|
170,722,007
|
|
|
|
185,325,364
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
and Stockholders' Equity
|
|
$
|
200,906,424
|
|
|
$
|
218,989,481
|
|
IT TECH PACKAGING,
INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE
INCOME
|
FOR THE THREE AND
NINE MONTHS ENDED SEPTEMBER 30, 2018 AND 2017
|
(Unaudited)
|
|
|
|
Three Months
Ended
|
|
|
Nine Months
Ended
|
|
|
|
September
30,
|
|
|
September
30,
|
|
|
|
2018
|
|
|
2017
|
|
|
2018
|
|
|
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
26,723,657
|
|
|
$
|
33,507,053
|
|
|
$
|
61,761,041
|
|
|
$
|
81,584,395
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales
|
|
|
(25,464,314)
|
|
|
|
(26,285,765)
|
|
|
|
(58,181,584)
|
|
|
|
(65,244,521)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
Profit
|
|
|
1,259,343
|
|
|
|
7,221,288
|
|
|
|
3,579,457
|
|
|
|
16,339,874
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
|
(2,829,933)
|
|
|
|
(2,848,699)
|
|
|
|
(9,670,992)
|
|
|
|
(8,319,590)
|
|
Gain (Loss) from
disposal of property, plant and
equipment
|
|
|
237
|
|
|
|
(1,653,039)
|
|
|
|
(10,026)
|
|
|
|
(1,665,140)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) Income from
Operations
|
|
|
(1,570,353)
|
|
|
|
2,719,550
|
|
|
|
(6,101,561)
|
|
|
|
6,355,144
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income
(Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
5,222
|
|
|
|
5,503
|
|
|
|
32,641
|
|
|
|
29,259
|
|
Subsidy
income
|
|
|
(5,786)
|
|
|
|
410
|
|
|
|
244,723
|
|
|
|
41,223
|
|
Interest
expense
|
|
|
(372,276)
|
|
|
|
(647,963)
|
|
|
|
(1,183,269)
|
|
|
|
(2,023,577)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Loss) Income
before Income Taxes
|
|
|
(1,943,193)
|
|
|
|
2,077,500
|
|
|
|
(7,007,466)
|
|
|
|
4,402,049
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for
Income Taxes
|
|
|
538,231
|
|
|
|
(505,165)
|
|
|
|
1,626,222
|
|
|
|
(1,105,928)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (Loss)
Income
|
|
|
(1,404,962)
|
|
|
|
1,572,335
|
|
|
|
(5,381,244)
|
|
|
|
3,296,121
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
Comprehensive (Loss) Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustment
|
|
|
(6,994,097)
|
|
|
|
3,790,338
|
|
|
|
(9,222,113)
|
|
|
|
8,035,099
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Comprehensive (Loss) Income
|
|
$
|
(8,399,059)
|
|
|
$
|
5,362,673
|
|
|
$
|
(14,603,357)
|
|
|
$
|
11,331,220
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Losses) Earnings
Per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Diluted
(Losses) Earnings per Share
|
|
$
|
(0.07)
|
|
|
$
|
0.07
|
|
|
$
|
(0.25)
|
|
|
$
|
0.15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding –
Basic and Diluted
|
|
|
21,450,316
|
|
|
|
21,450,316
|
|
|
|
21,450,316
|
|
|
|
21,450,316
|
|
IT TECH PACKAGING,
INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
FOR THE NINE
MONTHS ENDED SEPTEMBER 30, 2018 AND 2017
|
(Unaudited)
|
|
|
|
Nine Months
Ended
|
|
|
|
September
30,
|
|
|
|
2018
|
|
|
2017
|
|
|
|
|
|
|
|
|
Cash Flows from
Operating Activities:
|
|
|
|
|
|
|
Net income
|
|
$
|
(5,381,244)
|
|
|
$
|
3,296,121
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
10,873,536
|
|
|
|
10,928,502
|
|
Loss from disposal of
property, plant and equipment
|
|
|
10,026
|
|
|
|
1,665,140
|
|
Allowance for bad
debts
|
|
|
(11,444)
|
|
|
|
(78,562)
|
|
Share-based
compensation expenses
|
|
|
-
|
|
|
|
-
|
|
Deferred
tax
|
|
|
(1,629,706)
|
|
|
|
(2,034,373)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
572,184
|
|
|
|
3,928,087
|
|
Prepayments and other
current assets
|
|
|
(3,528,818)
|
|
|
|
472,847
|
|
Inventories
|
|
|
3,562,834
|
|
|
|
(3,631,641)
|
|
Accounts
payable
|
|
|
(354,689)
|
|
|
|
(561,121)
|
|
Advance from
customers
|
|
|
-
|
|
|
|
(29,446)
|
|
Notes
payable
|
|
|
(2,294,280)
|
|
|
|
3,680,693
|
|
Due to related
parties
|
|
|
114,714
|
|
|
|
(36,807)
|
|
Accrued payroll and
employee benefits
|
|
|
(35,419)
|
|
|
|
120,250
|
|
Other payables and
accrued liabilities
|
|
|
437,532
|
|
|
|
(771,027)
|
|
Income taxes
payable
|
|
|
(525,502)
|
|
|
|
(107,105)
|
|
Net Cash Provided
by Operating Activities
|
|
|
1,809,724
|
|
|
|
16,841,558
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
|
|
|
|
|
Purchases of
property, plant and equipment
|
|
|
(1,812,280)
|
|
|
|
(7,628,798)
|
|
Proceeds from sale of
property, plant and equipment
|
|
|
-
|
|
|
|
58,632
|
|
|
|
|
|
|
|
|
|
|
Net Cash Used in
Investing Activities
|
|
|
(1,812,280)
|
|
|
|
(7,570,166)
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Financing Activities:
|
|
|
|
|
|
|
|
|
Proceeds from related
party loans
|
|
|
4,588,559
|
|
|
|
-
|
|
Repayments of related
party loans
|
|
|
(9,177,118)
|
|
|
|
-
|
|
Proceeds from short
term bank loans
|
|
|
9,635,974
|
|
|
|
10,011,484
|
|
Repayment of bank
loans
|
|
|
(4,282,655)
|
|
|
|
(5,152,970)
|
|
Proceeds from credit
union loans
|
|
|
-
|
|
|
|
2,355,643
|
|
Payment of capital
lease obligation
|
|
|
-
|
|
|
|
(8,973,845)
|
|
|
|
|
|
|
|
|
|
|
Net Cash Provided
by (Used in) Financing Activities
|
|
|
764,760
|
|
|
|
(1,759,688)
|
|
|
|
|
|
|
|
|
|
|
Effect of Exchange
Rate Changes on Cash and Cash Equivalents
|
|
|
(677,172)
|
|
|
|
525,526
|
|
|
|
|
|
|
|
|
|
|
Net Increase in
Cash and Cash Equivalents
|
|
|
85,032
|
|
|
|
8,037,230
|
|
|
|
|
|
|
|
|
|
|
Cash, Cash
Equivalents and Restricted Cash - Beginning of
Period
|
|
|
9,017,427
|
|
|
|
4,494,964
|
|
|
|
|
|
|
|
|
|
|
Cash, Cash
Equivalents and Restricted Cash - End of Period
|
|
$
|
9,102,459
|
|
|
$
|
12,532,194
|
|
|
|
|
|
|
|
|
|
|
Supplemental
Disclosure of Cash Flow Information:
|
|
|
|
|
|
|
|
|
Cash paid for
interest, net of capitalized interest cost
|
|
$
|
1,409,695
|
|
|
$
|
1,359,343
|
|
Cash paid for income
taxes
|
|
$
|
522,547
|
|
|
$
|
3,247,406
|
|
|
|
|
|
|
|
|
|
|
Cash and bank
balances
|
|
|
5,468,315
|
|
|
|
6,505,284
|
|
Restricted
cash
|
|
|
3,634,144
|
|
|
|
6,026,910
|
|
Total cash, cash
equivalents and restricted cash shown in the statement of cash
flows
|
|
|
9,102,459
|
|
|
|
12,532,194
|
|
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content:http://www.prnewswire.com/news-releases/it-tech-packaging-inc-announces-third-quarter-2018-financial-results-300746559.html
SOURCE IT Tech Packaging, Inc.