BAODING, China, March 23, 2021 /PRNewswire/ -- IT Tech
Packaging, Inc. (NYSE American: 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
fourth quarter and audited financial results for the
fiscal year ended December 31,
2020.
Fourth Quarter 2020 Financial Results
|
|
For the
Three Months Ended December 31,
|
($
millions)
|
|
2020
|
|
2019
|
|
%
Change
|
Revenues
|
|
32.48
|
|
33.61
|
|
-3.4%
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
19.68
|
|
19.61
|
|
0.3%
|
Light-Weight
CMP**
|
|
5.24
|
|
5.08
|
|
3.1%
|
Offset Printing
Paper
|
|
4.88
|
|
7.16
|
|
-31.9%
|
Tissue Paper
Products
|
|
2.65
|
|
1.75
|
|
51.3%
|
Face
Masks
|
|
0.04
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
Gross
profit
|
|
0.75
|
|
5.60
|
|
-86.7%
|
Gross profit
(loss) margin
|
|
2.3%
|
|
16.7%
|
|
-14.4
pp****
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
1.4%
|
|
15.4%
|
|
-14.0
pp****
|
Light-Weight
CMP**
|
|
3.9%
|
|
18.3%
|
|
-14.4
pp****
|
Offset Printing
Paper
|
|
13.6%
|
|
33.7%
|
|
-20.1pp****
|
Tissue Paper
Products***
|
|
-15.0%
|
|
-43.1%
|
|
28.1
pp****
|
Face
Masks
|
|
5.81%
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
Operating
income (loss)
|
|
-1.97
|
|
3.19
|
|
-161.7%
|
Net
income
|
|
-2.69
|
|
2.16
|
|
-224.8%
|
EBITDA
|
|
1.56
|
|
6.98
|
|
-77.6%
|
Basic and
Diluted earnings (loss) per share
|
|
-0.06
|
|
0.10
|
|
-160.0%
|
|
|
|
|
|
|
|
* Products
from PM6
|
|
|
|
|
|
|
** Products
from PM1
|
|
|
|
|
|
|
*** Products
from PM8 and PM9
|
|
|
|
|
|
|
**** pp
represents percentage points
|
|
|
|
|
|
|
- Revenue slightly decreased by 3.4% to $32.48 million, primarily attributable to a
decrease in sales volume of offset printing paper.
- Gross profit decreased by 86.7% to $0.75
million. Total gross margin decreased by 14.4 percentage
point to 2.3%.
- Loss from operations was $1.97
million, compared to income from operations of $3.19 million for the same period of last
year.
- Net loss was $2.69 million, or
loss of $0.06 per basic and diluted
share, compared to net income of $2.16
million, or $0.10 per basic
and diluted share, for the same period of last year.
- Earnings before interest, taxes, depreciation and amortization
("EBITDA") decreased by 77.6% to $1.56
million.
Mr. Zhenyong Liu, Chairman and
Chief Executive Officer of the Company, commented, "We continued to
making improvements in the sales volume of tissue paper products
and posted slight decrease in sales of CMP products for this
quarter. Our total revenue had a slight decline of 3.4% to
$32.5 million but we managed to
grow sales from tissue paper products by 51.3% to a total volume of
3,165 tonnes for this quarter. The average selling prices
(ASPs) of our products for this quarter increased by 5.6% from Q3
2020, or a minor growth compared to the same period last year (Q4
2019).
"We took a quick recovery from the impact caused by global
outbreaks of COVID-19 pandemic, posting growing revenues from sales
of tissue paper, regular and light-weight CMP products. Our
production and sales of tissue paper products have been growing up
steadily since the launch of PM8 and PM9 in December 2018 and November
2019.
"Currently we are in the process to apply for surgical face
masks production license which we expect to boost both our sales
and margins in the very near future. Though on-site inspection on
our production facilities by the authorities was delayed by the
pandemic, we are expecting final review results by local food and
drug administration in Hebei
province. We anticipate to obtain the license once the relevant
review works are finished."
Revenue
For the fourth quarter of 2020, total revenue decreased by
$1.1 million, or 3.4%, to
$32.5 million from $33.6 million for the same period of last year.
The decrease in total revenue was mainly due to the decrease in
sales volume of CMP and offset printing paper.
The following table summarizes revenue, volume and ASP by
product for the fourth quarter of 2020 and 2019, respectively:
|
For the
Three Months Ended December 31,
|
|
2020
|
|
2019
|
|
Revenue
($'000)
|
|
Volume
(tonne)
|
|
ASP
($/tonne)
|
|
Revenue
($'000)
|
|
Volume
(tonne)
|
|
ASP
($/tonne)
|
Regular
CMP
|
19,677
|
|
45,210
|
|
435
|
|
19,610
|
|
47,063
|
|
417
|
Light-Weight
CMP
|
5,242
|
|
12,417
|
|
422
|
|
5,083
|
|
12,582
|
|
404
|
Offset Printing
Paper
|
4,877
|
|
7,895
|
|
618
|
|
7,162
|
|
10,450
|
|
685
|
Tissue Paper
Products
|
2,648
|
|
3,164
|
|
837
|
|
1,751
|
|
2,558
|
|
684
|
Total
|
32,444
|
|
68,686
|
|
472
|
|
33,606
|
|
72,654
|
|
463
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
($'000)
|
|
Volume
(thousand pieces)
|
|
ASP
($/thousand pieces)
|
|
Revenue
($'000)
|
|
Volume
($/thousand pieces)
|
|
ASP
($/thousand pieces)
|
Face
Masks
|
35
|
|
445
|
|
79
|
|
NM
|
|
NM
|
|
NM
|
Revenue from CMP, including both regular CMP and light-Weight
CMP, increased by $0.2 million, or
0.9%, to $24.9 million and accounted
for 76.7% of total revenue for the fourth quarter of 2020, compared
to $24.7 million, or 73.5% of total
revenue, for the same period of last year. The Company sold 57,627
tonnes of CMP at an ASP of $432/tonne
in the fourth quarter of 2020, compared to 59,646 tonnes at an ASP
of $414/tonne in the same period of
last year.
Of the total CMP sales, revenue from regular CMP increased by
$0.1 million, or 0.3%, to
$19.7 million, resulting from sales
of 45,210 tonnes at an ASP of $435/tonne, during the fourth quarter of 2020,
compared to revenue of $19.6 million,
resulting from sales of 47,063 tonnes at an ASP of $417/tonne, for the same period of last year.
Revenue from light-weight CMP increased by $0.2 million, or 3.1%, to $5.2 million, resulting from sales of 12,417
tonnes at an ASP of $422/tonne for
the fourth quarter of 2020, compared to revenue of $5.1 million, resulting from sales of 12,583
tonnes at an ASP of $404/tonne for
the same period of last year.
Revenue from offset printing paper decreased by $2.3 million, or 31.9%, to $4.9 million for the fourth quarter of 2020, from
$7.2 million for the same period of
last year. The Company sold 7,895 tonnes of offset printing paper
at an ASP of $618/tonne in the fourth
quarter of 2020, compared to 10,450 tonnes at an ASP of
$685/tonne in the same period of last
year.
Revenue from tissue paper products increased by $0.9 million, or 51.3%, to $2.6 million, resulting from sales of 3,165
tonnes at an ASP of $837/tonne, for
the fourth quarter of 2020, compared to revenue of $1.7 million, resulting from sales of 2,558tonnes
at an ASP of $684/tonne for the same
period of last year.
Revenue generated from selling face masks was $0.04 million for the fourth quarter ended
December 31, 2020. The Company sold
445 thousand pieces of face masks in the fourth quarter of
2020.
Gross Profit and Gross Margin
Total cost of sales increased by $3.7
million, or 13.2%, to $31.7
million for the fourth quarter of 2020 from $28.0 million for the same period of last year.
For paper products, overall cost of sales per tonne was
$462 for the fourth quarter of 2020,
compared to $388 for the same period
of last year. The increase in overall cost of sales was mainly due
to the increased manufacturing overhead costs and increased
material costs, specifically higher average unit purchase costs of
recycled paper board and recycled white scrap paper in the fourth
quarter of 2020. Costs of sales per tonne for regular CMP,
light-weight CMP, offset printing paper, and tissue paper products
were $429, $406, $534, and
$962, respectively, for the fourth
quarter of 2020, compared to $353,
$330, $454 and $979,
respectively, for the same period of last year. Total gross profit
was $0.7 million for the fourth
quarter of 2020, compare to the gross profit of $5.6 million for the same period of last year as
a result of factors described above. Overall gross margin was 2.3%
for the fourth quarter of 2020, compared to 16.7% for the same
period of last year. Gross profit (loss) margins for regular CMP,
light-weight CMP, offset printing paper, tissue paper products and
face mask products were 1.4%, 3.9%, 13.6%, -15.0% and 5.81%,
respectively, for the fourth quarter of 2020, compared to 15.4%,
18.3%, 33.7%,-45.1%,-43.1 and nil, respectively, for the same
period of last year.
Selling, General and Administrative Expenses
Selling, general and administrative expenses ("SG&A")
increased by $0.3 million, or 14.6%,
to $2.7 million for the fourth
quarter of 2020 from $2.4 million for
the same period of last year. The increase was mainly due to
issuance of 2,000,000 shares of common stock valued at $1,200,000 to officers and directors under the
Company's omnibus equity incentive plan.
Income (loss) from Operations
Loss from operations was $2.0
million for the fourth quarter of 2020, compared to income
from operations of $3.2 million for
the same period of last year. The decrease in income from
operations was primarily due to increased SG&A expenses and
decreased gross profit this quarter as discussed above. Operating
margin was -6.1% for the fourth quarter of 2020, compared to
operating margin of 9.5% for the same period of last year.
Net Income (Loss)
Net loss was $2.7 million, or
$0.06 loss per basic and diluted
share, for the fourth quarter of 2020, compared to net income of
$2.2 million, or $0.10 per basic and diluted share, for the same
period of last year.
EBITDA
EBITDA was $1.6 million for the
fourth quarter of 2020, compared to $7.0
million for the same period of last year.
Note 1: Non-GAAP Financial Measures
In addition to our U.S. GAAP results, this press release
includes a discussion of EBITDA, a non-GAAP financial measure as
defined by the Securities and Exchange Commission ("SEC"). The
Company defines EBITDA as net income before interest, income taxes,
depreciation and amortization. EBITDA is a key measure used by
management to evaluate our results and make strategic decisions.
Management believes this measure is useful to investors because it
is an indicator of operational performance. Because not all
companies use identical calculations, the Company's presentation of
EBITDA may not be comparable to similarly titled measures of other
companies, and should not be viewed as an alternative to measures
of financial performance or changes in cash flows calculated in
accordance with the U.S. GAAP.
Reconciliation of Net Income to EBITDA
(Amounts expressed in US$)
|
|
|
|
|
|
|
|
For the
Three Months Ended December 31,
|
($
millions)
|
|
2020
|
|
|
2019
|
Net income
(loss)
|
|
-2.69
|
|
|
2.16
|
Add: Income
tax
|
|
-0.52
|
|
|
0.87
|
Net
interest expense
|
|
0.28
|
|
|
0.20
|
Depreciation and amortization
|
|
4.49
|
|
|
3.76
|
EBITDA
|
|
1.56
|
|
|
6.98
|
Full Year Ended December 31,
2020 Financial Results
|
|
For the
Twelve Months Ended December 31,
|
($
millions)
|
|
2020
|
|
2019
|
|
%
Change
|
Revenues
|
|
100.94
|
|
117.61
|
|
-14.2%
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
62.32
|
|
72.05
|
|
-13.5%
|
Light-Weight
CMP**
|
|
16.84
|
|
18.78
|
|
-10.3%
|
Offset Printing
Paper
|
|
12.27
|
|
20.44
|
|
-40.0%
|
Tissue Paper
Products
|
|
8.41
|
|
6.35
|
|
32.5%
|
Face
Masks
|
|
1.10
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
Gross
profit
|
|
5.70
|
|
13.68
|
|
-58.3%
|
Gross profit
(loss) margin
|
|
5.6%
|
|
11.6%
|
|
-6.0
pp****
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
5.4%
|
|
10.3%
|
|
-4.9
pp****
|
Light-Weight
CMP**
|
|
8.9%
|
|
10.1%
|
|
-1.2
pp****
|
Offset Printing
Paper
|
|
17.3%
|
|
31.2%
|
|
-13.9
pp****
|
Tissue Paper
Products***
|
|
-21.7%
|
|
-31.5%
|
|
9.7 pp****
|
Face
Masks
|
|
48.1%
|
|
NM
|
|
NM
|
|
|
|
|
|
|
|
Operating
income (loss)
|
|
-5.46
|
|
3.90
|
|
-240.0%
|
Net
income
|
|
-5.55
|
|
2.22
|
|
-350.0%
|
EBITDA
|
|
10.16
|
|
19.33
|
|
-47.4%
|
Basic and
Diluted earnings (loss) per share
|
|
-0.21
|
|
0.10
|
|
-307.9%
|
|
|
|
|
|
|
|
* Products
from PM6
|
|
|
|
|
|
|
** Products
from PM1
|
|
|
|
|
|
|
*** Products
from PM8 and PM9
|
|
|
|
|
|
|
**** pp
represents percentage points
|
|
|
|
|
|
|
Revenue
For the year ended December 31,
2020, total revenue decreased by $16.7 million, or 14.2%, to $100.9 million from $117.6
million for 2019. The decrease in total revenue was mainly
due to a decrease in sales volume of Regular CMP, offset printing
paper and a decrease in ASPs over all paper products categories.
The following table summarizes revenue, volume and ASP by product
for the years ended December 31, 2020
and 2019, respectively:
|
For the
Twelve Months Ended December 31,
|
|
2020
|
|
2019
|
|
Revenue
($'000)
|
|
Volume
(tonne)
|
|
ASP
($/tonne)
|
|
Revenue
($'000)
|
|
Volume
(tonne)
|
|
ASP
($/tonne)
|
Regular
CMP
|
62,325
|
|
154,084
|
|
404
|
|
72,050
|
|
168,837
|
|
427
|
Light-Weight
CMP
|
16,836
|
|
42,801
|
|
393
|
|
18,776
|
|
45,310
|
|
414
|
Offset Printing
Paper
|
12,266
|
|
20,358
|
|
603
|
|
20,436
|
|
29,207
|
|
700
|
Tissue Paper
Products
|
8,415
|
|
10,088
|
|
834
|
|
6,351
|
|
6,790
|
|
935
|
Total
|
99,841
|
|
227,331
|
|
439
|
|
117,614
|
|
250,144
|
|
470
|
|
Revenue
($'000)
|
|
Volume
(thousand pieces)
|
|
ASP
($/thousand pieces)
|
|
Revenue
($'000)
|
|
Volume
($/thousand pieces)
|
|
ASP
($/thousand pieces)
|
Face
Masks
|
1,102
|
|
10,301
|
|
107
|
|
NM
|
|
NM
|
|
NM
|
Revenue from CMP, including both regular CMP and light-Weight
CMP decreased by $11.7 million, or
12.8%, to $79.2 million, and
accounted for 78.4% of total revenue for the year ended
December 31, 2020, compared to
$90.8 million, or 77.2% of total
revenue for 2019. The Company sold 196,885 tonnes of CMP at an ASP
of $402/tonne in the year ended
December 31, 2020, compared to
214,147 tonnes at an ASP of $424/tonne in 2019.
Of the total CMP sales, revenue from regular CMP decreased by
$9.7 million, or 13.5%, to
$62.3 million, resulting from sales
of 154,084 tonnes at an ASP of $404/tonne during the year ended December 31, 2020, compared to revenue of
$72.1 million, resulting from sales
of 168,837 tonnes at an ASP of $427/tonne for 2019. Revenue from light-weight
CMP decreased by $1.9 million, or
10.3%, to $16.8 million, resulting
from sales of 42,801 tonnes at an ASP of $393/tonne for the year ended December 31, 2020, compared to revenue of
$18.8 million, resulting from sales
of 45,310 tonnes at an ASP of $414/tonne for 2019.
Revenue from offset printing paper decreased by $8.1 million, or 40.0%, to $12.3 million for the year ended December 31, 2020 from $20.4 million for 2019. The Company sold 20,358
tonnes of offset printing paper at an ASP of $603/tonne in the year ended December 31, 2020, compared to 29,207 tonnes at
an ASP of $700/tonne in 2019.
Revenue from tissue paper products increased by $2.1 million, or 32.5%, to $8.4 million, resulting from sales of 10,088
tonnes at an ASP of $834/tonne, for
the year ended December 31, 2020,
compared to revenue of $6.4 million,
resulting from sales of 6,790 tonnes at an ASP of $935/tonne for 2019.
Revenue generated from selling face masks was $1.1 million for the year ended December 31, 2020. The Company sold 10,301
thousand pieces of face masks for the year ended December 31, 2020.
Gross Profit and Gross Margin
Total cost of sales decreased by 8.7 million, or 8.4%, to
$95.2 million for the year ended
December 31, 2020 from $104.0 million for 2019. The decrease in overall
cost of sales was mainly due to the decreased sales volume of CMP
and offset printing paper in the year ended December 31, 2020. Costs of sales per tonne
for regular CMP, light-weight CMP, offset printing paper, tissue
paper products were, $383,
$358, $498, and $1,015,
respectively, for the year ended December
31, 2020 compared to $383,
$372, $481, and $1,230,
respectively, for 2019.
Total gross profit decreased by $8.0
million, or 58.3%, to $5.7
million for the year ended December
31, 2020 from $13.7 million
for 2019. Overall gross margin decreased by 6.0 percentage points
to 5.6% for the year ended December 31,
2020 from 11.6% for 2019. Gross margins for regular CMP,
light-weight CMP, offset printing paper, tissue paper products and
face mask products were 5.4%, 8.9%, 17.3%, -21.7% and 48.1%,
respectively, for the year ended December
31, 2020, compared to 10.3%, 10.1%, 31.2%, -31.5% and nil,
respectively, for 2019.
Selling, General and Administrative Expenses
SG&A expenses increased by $1.4
million, or 14.1%, to $11.2
million for the year ended December
31, 2020 from $9.8 million for
2019. As a percentage of total revenue, SG&A expenses was 11.1%
for the year ended December 31, 2020,
compared to 8.3% for 2019.
Income (Loss) from Operations
Loss from operations increased by $9.4
million, or 240.0%, to $5.5
million for the year ended December
31, 2020 from income from operations of $3.9 million for 2019. Operating loss margin was
5.4% for the year ended December 31,
2020, compared to operating margin of 3.3% for 2019.
Net Income (Loss)
Net loss increased by $7.8
million, or 350.0%, to $5.6
million, or loss per basic and diluted share of $0.21, for the year ended December 31, 2020, compared to net income of
$2.2 million, or earnings per basic
and diluted share of $0.10, for
2019.
EBITDA
EBITDA decreased by $9.1 million,
or 47.4%, to $10.2 million for the
year ended December 31, 2020 from
$19.3 million for 2019.
Note 1: Non-GAAP Financial Measures
In addition to our U.S. GAAP results, this press release
includes a discussion of EBITDA, a non-GAAP financial measure as
defined by the Securities and Exchange Commission ("SEC"). The
Company defines EBITDA as net income before interest, income taxes,
depreciation and amortization. EBITDA is a key measure used by
management to evaluate our results and make strategic decisions.
Management believes this measure is useful to investors because it
is an indicator of operational performance. Because not all
companies use identical calculations, the Company's presentation of
EBITDA may not be comparable to similarly titled measures of other
companies, and should not be viewed as an alternative to measures
of financial performance or changes in cash flows calculated in
accordance with the U.S. GAAP.
Reconciliation of Net Income to EBITDA
(Amounts expressed in US$)
|
|
For the
Twelve Months Ended December 31,
|
($
millions)
|
|
2020
|
|
|
2019
|
Net income
(loss)
|
|
-5.55
|
|
|
2.22
|
Add: Income
tax
|
|
-1.10
|
|
|
1.08
|
Net
interest expense
|
|
1.03
|
|
|
0.73
|
Depreciation and amortization
|
|
15.79
|
|
|
15.30
|
EBITDA
|
|
10.16
|
|
|
19.33
|
Cash, Liquidity and Financial Position
As of December 31, 2020, 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), and long-term debt (including loan from
credit union) of $4.14 million,
$12.16 million and $4.60 million, respectively, compared to
$5.84 million, $8.31 million and $7.37
million, respectively, at the end of 2019.
Net accounts receivable was $2.39 million as of December 31, 2020, compared to $3.12 million as of December 31, 2019. Net inventory was $1.23 million as of December 31, 2020, compared to $1.61 million at the end of 2019. As of
December 31, 2020, the Company had
current assets of $14.91 million
and current liabilities of $18.34 million, resulting in a working
capital deficit of $3.43 million. This was compared to current
assets of $24.04 million and
current liabilities of $16.84 million, resulting in a working
capital of $7.21 million at the
end of 2019.
Net cash provided by operating activities was $16.14 million for the year ended December 31, 2020, compared to net cash provided
by operating activities of $7.53
million for 2019. Net cash used in investing activities was
$20.53 million for the year ended
December 31, 2020, compared to
$7.87 million for 2019. Net cash
provided by financing activities was $2.05
million for the year ended December
31, 2020, compared to net cash used in financing activities
of $5.77 million for 2019.
Recent development
In November 2020, the Company
completed inviting bids for the 75 tonne per hour biomass boiler
procurement for its biomass cogeneration project. Multiple
well-known enterprises in the biomass industry participated in
tendering opening bids. In February
2021, the Company completed evaluation on the bidding
proposals and announced that Tai Shan Group Co., Ltd., a top
manufacturer in the biomass industry in China, has won the bid. Installation of the
boilers is expected to commence in the near future. The Company
expects to participate in the bidding process for urban central
heating projects.
On January 12, 2021, the Company
announced it has submitted its application for the license for its
new single-use surgical masks from local food and drug
administration in Hebei province. Production of its
single-use non-medical face masks was in full capacity as the
number of confirmed Covid-19 cases surged again and anti-Covid-19
efforts became increasingly normalized globally.
On January 20, 2021, the Company
offered and sold to certain institutional investors an aggregate of
26,181,818 shares of common stock and 26,181,818 warrants to
purchase up to 26,181,818 shares of common stock in a best-efforts
public offering for gross proceeds of approximately $14.4 million. The purchase price for each share
of common stock and the corresponding warrant sold in the offering
was $0.55. The warrants are
exercisable commencing on January 20,
2021 at an exercise price of $0.55 and will expire on January 20, 2026. The Company intends to use the
net proceeds from the offering for general corporate and working
capital purposes.
On March 1, 2021, the Company
offered and sold to the public investors an aggregate of 29,277,866
shares of common stock and 14,638,933 warrants to purchase up to
14,638,933 shares of common stock in a firm commitment underwritten
public offering for gross proceeds of approximately $21.9 million. The purchase price for each share
of common stock and accompanying warrant sold in the offering was
$0.75. The warrants are exercisable
commencing on March 1, 2021 at an
exercise price of $0.75 and will
expire on March 1, 2026. The Company
intends to use the net proceeds from the offering for general
corporate and working capital purposes.
Earnings Conference Call
The Company's management will host a conference call to discuss
its fourth quarter and fiscal year 2020 financial results
at 8:00 am US Eastern Time on Wednesday, March 24, 2021.
To attend the conference call, please use the information
below.
Conference Topic: IT Tech Packaging Inc. Fourth Quarter
and Fiscal Year 2020 Earnings Conference Call and Webcast
Date of call: March 24,
2021
Time of call: 8:00 AM Eastern
Time (8:00 PM Beijing/Hong
Kong Time)
Conference ID: 8679484
To attend the conference call, please register in advance of the
conference using the
link: http://apac.directeventreg.com/registration/event/8679484
to complete the online registration at least 15 minutes prior to
the start of the call. Upon registering, the conference access
information including participant dial-in numbers, a Direct Event
passcode and a registrant ID will be provided to you via an
email.
This conference call will be broadcast live on the Internet and
can be accessed by all interested parties at
https://edge.media-server.com/mmc/p/5soq5wdd. Please access
the link at least 15 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 March 24,
2021 to 8:59 am ET on
April 1, 2021. To listen, please
dial+1-855-452-5696 if calling fromthe United States, or +61-281-990-299 if calling
internationally. Use the conference ID 8679484 to access the
replay.
About IT Tech Packaging, Inc.
Founded in 1996, IT Tech Packaging, Inc. 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 American since December 2009. For more information, please
visit: http://www.itpackaging.cn/ .
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
Tel: +86 0312 8698215
Investor Relations:
Janice Wang
EverGreen Consulting Inc.
Email: ir@changqingconsulting.com
Phone: +1 571-464-9470 (from U.S.)
+86 13811768559 (from China)
IT TECH PACKAGING,
INC.
|
CONSOLIDATED
BALANCE SHEETS
|
AS OF DECEMBER 31,
2020 AND 2019
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2020
|
|
|
2019
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
Cash and bank
balances
|
|
$
|
4,142,437
|
|
|
$
|
5,837,745
|
|
Restricted
cash
|
|
|
-
|
|
|
|
-
|
|
Accounts receivable
(net of allowance for doubtful accounts of $34,391 and $59,922
as
of December 31, 2020
and December 2019, respectively)
|
|
|
2,389,057
|
|
|
|
3,119,311
|
|
Inventories
|
|
|
1,233,801
|
|
|
|
1,607,463
|
|
Prepayments and other
current assets
|
|
|
7,051,515
|
|
|
|
11,613,241
|
|
Due from related
parties
|
|
|
92,795
|
|
|
|
1,863,479
|
|
Total current
assets
|
|
|
14,909,605
|
|
|
|
24,041,239
|
|
|
|
|
|
|
|
|
|
|
Prepayment on
property, plant and equipment
|
|
|
21,149,749
|
|
|
|
1,433,445
|
|
Finance lease
right-of-use assets, net
|
|
|
2,397,653
|
|
|
|
-
|
|
Property, plant, and
equipment, net
|
|
|
145,142,642
|
|
|
|
151,616,852
|
|
Value-added tax
recoverable
|
|
|
2,566,195
|
|
|
|
2,621,841
|
|
Deferred tax asset
non-current
|
|
|
13,708,630
|
|
|
|
10,485,053
|
|
|
|
|
|
|
|
|
|
|
Total
Assets
|
|
$
|
$199,874,474
|
|
|
$
|
190,198,430
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
|
|
Short-term bank
loans
|
|
$
|
6,435,348
|
|
|
$
|
6,163,814
|
|
Current portion of
long-term loans from credit union
|
|
|
4,996,245
|
|
|
|
1,605,459
|
|
Lease
liability
|
|
|
182,852
|
|
|
|
-
|
|
Accounts
payable
|
|
|
592,391
|
|
|
|
250,486
|
|
Advance from
customers
|
|
|
82,625
|
|
|
|
98,311
|
|
Due to related
parties
|
|
|
727,433
|
|
|
|
539,985
|
|
Accrued payroll and
employee benefits
|
|
|
224,930
|
|
|
|
291,924
|
|
Other payables and
accrued liabilities
|
|
|
4,838,601
|
|
|
|
6,503,010
|
|
Income taxes
payable
|
|
|
259,649
|
|
|
|
1,382,471
|
|
|
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
|
18,340,074
|
|
|
|
16,835,460
|
|
|
|
|
|
|
|
|
|
|
Loans from credit
union
|
|
|
4,597,772
|
|
|
|
7,367,908
|
|
Deferred gain on
sale-leaseback
|
|
|
387,087
|
|
|
|
-
|
|
Lease liability -
non-current
|
|
|
354,107
|
|
|
|
-
|
|
Derivative
liability
|
|
|
1,115,260
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
(including amounts of the consolidated VIE without recourse to the
Company of $17,950,224 and $19,558,568 as of December 31, 2020 and
2019, respectively)
|
|
|
24,794,300
|
|
|
|
24,203,368
|
|
|
|
|
|
|
|
|
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity
|
|
|
|
|
|
|
|
|
Common stock,
500,000,000 shares authorized, $0.001 par value per share,
28,535,816 and 22,054,816 shares issued and outstanding as of
December 31, 2020 and December, 31,2019, respectively
|
|
|
28,536
|
|
|
|
22,055
|
|
Additional paid-in
capital
|
|
|
53,989,548
|
|
|
|
51,155,174
|
|
Statutory earnings
reserve
|
|
|
6,080,574
|
|
|
|
6,080,574
|
|
Accumulated other
comprehensive income (loss)
|
|
|
5,740,722
|
|
|
|
(6,057,537)
|
|
Retained
earnings
|
|
|
109,240,794
|
|
|
|
114,794,796
|
|
|
|
|
|
|
|
|
|
|
Total
stockholders' equity
|
|
|
175,080,174
|
|
|
|
165,995,062
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
and Stockholders' Equity
|
|
$
|
199,874,474
|
|
|
$
|
190,198,430
|
|
IT TECH PACKAGING,
INC.
|
CONSOLIDATED
STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(LOSS)
|
FOR THE YEARS
ENDED DECEMBER 31, 2020 AND 2019
|
|
|
|
Year
Ended
|
|
|
|
December 31,
|
|
|
|
2020
|
|
|
2019
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
100,943,269
|
|
|
$
|
117,614,886
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales
|
|
|
(95,241,284)
|
|
|
|
(103,935,368)
|
|
|
|
|
|
|
|
|
|
|
Gross
Profit
|
|
|
5,701,985
|
|
|
|
13,679,518
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
|
(11,157,789)
|
|
|
|
(9,781,719)
|
|
Gain on acquisition
of a subsidiary
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
(Loss) Income from
Operations
|
|
|
(5,455,804)
|
|
|
|
3,897,799
|
|
|
|
|
|
|
|
|
|
|
Other Income
(Expense):
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
32,033
|
|
|
|
64,717
|
|
Subsidy
income
|
|
|
220,478
|
|
|
|
261,136
|
|
Interest
expense
|
|
|
(1,026,512)
|
|
|
|
(926,368)
|
|
Loss on derivative
liability
|
|
|
(426,055)
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
(Loss) Income
before Income Taxes
|
|
|
(6,655,860)
|
|
|
|
3,297,284
|
|
|
|
|
|
|
|
|
|
|
Provision for
Income Taxes
|
|
|
1,101,858
|
|
|
|
(1,076,102)
|
|
|
|
|
|
|
|
|
|
|
Net (Loss)
Income
|
|
|
(5,554,002)
|
|
|
|
2,221,182
|
|
|
|
|
|
|
|
|
|
|
Other
Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustment
|
|
|
11,798,259
|
|
|
|
(2,793,585)
|
|
|
|
|
|
|
|
|
|
|
Total
Comprehensive Income (Loss)
|
|
$
|
6,244,257
|
|
|
$
|
(572,403)
|
|
|
|
|
|
|
|
|
|
|
(Losses) Earnings
Per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Diluted
(Losses) Earnings per Share
|
|
$
|
(0.21)
|
|
|
$
|
0.10
|
|
|
|
|
|
|
|
|
|
|
Outstanding –
Basic and Diluted
|
|
|
26,498,298
|
|
|
|
22,034,905
|
|
IT TECH PACACKING,
INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
FOR THE YEARS
ENDED DECEMBER 31, 2020 AND 2019
|
|
|
|
Year
Ended
|
|
|
|
December
31,
|
|
|
|
2020
|
|
|
2019
|
|
Cash Flows from
Operating Activities:
|
|
|
|
|
|
|
Net income
|
|
$
|
(5,554,002)
|
|
|
$
|
2,221,182
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
15,793,854
|
|
|
|
15,304,039
|
|
Loss on derivative
liability
|
|
|
426,055
|
|
|
|
-
|
|
Allowances for
obsolete inventories, net
|
|
|
-
|
|
|
|
75,719
|
|
(Recovery from)
Allowance for bad debts
|
|
|
(28,087)
|
|
|
|
2,192
|
|
Share-based
compensation and expenses
|
|
|
1,256,700
|
|
|
|
-
|
|
Gain on acquisition
of a subsidiary
|
|
|
-
|
|
|
|
-
|
|
Deferred
tax
|
|
|
(2,364,575)
|
|
|
|
(2,369,683)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
923,429
|
|
|
|
(294,882)
|
|
Prepayments and other
current assets
|
|
|
5,301,953
|
|
|
|
(5,392,916)
|
|
Inventories
|
|
|
458,878
|
|
|
|
1,207,958
|
|
Accounts
payable
|
|
|
307,198
|
|
|
|
(372,728)
|
|
Advance from
customers
|
|
|
(21,281)
|
|
|
|
99,472
|
|
Notes
payable
|
|
|
-
|
|
|
|
(3,625,921)
|
|
Related
parties
|
|
|
1,984,619
|
|
|
|
(1,757,231)
|
|
Accrued payroll and
employee benefits
|
|
|
(82,516)
|
|
|
|
82,813
|
|
Other payables and
accrued liabilities
|
|
|
(1,105,508)
|
|
|
|
1,169,967
|
|
Income taxes
payable
|
|
|
(1,153,191)
|
|
|
|
1,180,493
|
|
Net Cash Provided
by Operating Activities
|
|
|
16,143,526
|
|
|
|
7,530,474
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
|
|
|
|
|
Purchases of
property, plant and equipment
|
|
|
(21,106,210)
|
|
|
|
(6,416,481)
|
|
Proceeds from sale of
property, plant and equipment
|
|
|
580,206
|
|
|
|
|
|
Acquisition of a
subsidiary
|
|
|
-
|
|
|
|
(1,450,368)
|
|
Net Cash Used in
Investing Activities
|
|
|
(20,526,004)
|
|
|
|
(7,866,849)
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from
Financing Activities:
|
|
|
|
|
|
|
|
|
Proceeds from
issuance of shares and warrants, net
|
|
|
2,273,360
|
|
|
|
-
|
|
Repayments of related
party loans
|
|
|
-
|
|
|
|
(2,175,553)
|
|
Proceeds from short
term bank loans
|
|
|
6,090,715
|
|
|
|
10,152,579
|
|
Proceeds from credit
union loans
|
|
|
-
|
|
|
|
4,206,068
|
|
Repayment of bank
loans
|
|
|
(6,237,217)
|
|
|
|
(17,955,561)
|
|
Payment of capital
lease obligation
|
|
|
(72,003)
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
Net Cash Provided
by (Used in) Financing Activities
|
|
|
2,054,855
|
|
|
|
(5,772,467)
|
|
|
|
|
|
|
|
|
|
|
Effect of Exchange
Rate Changes on Cash and Cash Equivalents
|
|
|
632,315
|
|
|
|
(170,838)
|
|
|
|
|
|
|
|
|
|
|
Net (Decrease)
Increase in Cash and Cash Equivalents
|
|
|
(1,695,308)
|
|
|
|
(6,279,680)
|
|
|
|
|
|
|
|
|
|
|
Cash, Cash
Equivalents and Restricted Cash - Beginning of Year
|
|
|
5,837,745
|
|
|
|
12,117,425
|
|
|
|
|
|
|
|
|
|
|
Cash, Cash
Equivalents and Restricted Cash - End of Year
|
|
$
|
4,142,437
|
|
|
$
|
5,837,745
|
|
|
|
|
|
|
|
|
|
|
Supplemental
Disclosure of Cash Flow Information:
|
|
|
|
|
|
|
|
|
Cash paid for
interest, net of capitalized interest cost
|
|
$
|
592,140
|
|
|
$
|
926,368
|
|
Cash paid for income
taxes
|
|
$
|
2,401,191
|
|
|
$
|
2,250,546
|
|
|
|
|
|
|
|
|
|
|
Cash and bank
balances
|
|
|
4,142,437
|
|
|
|
5,837,745
|
|
Restricted
cash
|
|
|
-
|
|
|
|
-
|
|
Total cash, cash
equivalents and restricted cash shown in the statement of cash
flows
|
|
|
4,142,437
|
|
|
|
5,837,745
|
|
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content:http://www.prnewswire.com/news-releases/it-tech-packaging-inc-announces-fourth-quarter-and-fiscal-year-2020-financial-results-301254333.html
SOURCE IT Tech Packaging, Inc.