BEIJING, Aug. 21, 2014 /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 second quarter
ended June 30, 2014.
Highlights
- Net sales during the second quarter ended June 30, 2014 were RMB70.0
million or US$11.3 million,
compared to RMB77.4 million during
the same period in 2013 representing a 9.6% decrease in
sales.
- Net loss attributable to the Company during the second quarter
ended June 30, 2014 was RMB23.0 million or US$3.7
million compared to net loss attributable to the Company of
RMB18.2 million during the same
period in 2013, representing an increase of RMB4.8 million for the same period in 2013.
- Net cash used in operating activities for the six months ended
June 30, 2014 was RMB7.5 million or US$1.2
million compared to net cash used in operating activities of
RMB11.2 million for the six months
ended June 30, 2013.
- Basic and diluted net loss per share was RMB1.76 or US$0.28
and RMB1.39 for the three months
ended June 30, 2014 and 2013,
respectively.
Mr. Xiaoan He, Chairman and CEO
of Fuwei Films, commented, "The second quarter financial results
continue to reflect weakened market conditions due to intense
competition which caused oversupply and excess capacity in the
marketplace. However, I am pleased to announce that a sample
diffusion film (a type of TFT-LCD optical film) was preliminarily
accepted by a new customer after being delivered for testing. We
expect to supply small batches of product according to this
customer's purchase order. In addition, a sample base film for
solar backsheets has been delivered to a customer for initial
testing. This demonstrates our ability to better serve our
customers by expanding our product offering to the market and we
will seek to capitalize upon opportunities in emerging markets with
expanded end user applications by focusing our efforts on continued
innovation and R&D. We believe that with the support of the new
controlling shareholder, the Company will be in a better position
to adjust to various challenges and to obtain better support in the
fierce marketplace."
Second Quarter of 2014 Financial Results
Net sales during the second quarter ended June 30, 2014 were RMB70.0
million or US$11.3 million,
compared to RMB77.4 million during
the same period in 2013, representing a decrease of RMB7.4 million or 9.6%, mainly due to the
reduction of average sales price by 14.0% arising from stronger
competition in China. Although the
reduction of average sales price caused a decrease of RMB11.3 million, this was partially offset by an
increase in sales volume of RMB3.9
million.
Overseas sales were RMB11.1
million or US$1.8 million, or
15.9% of total revenues, compared with RMB9.5 million or 12.3% of total revenues in the
second quarter of 2013. The increase in overseas sales was
primarily due to the increase in volume, which accounted for
RMB3.3 million, although this was
partially offset by the decrease of RMB1.7
million in average sales price.
The following is a breakdown of domestic versus overseas sales
for the three-month periods ended June 30,
2014 and 2013 (amounts in thousands):
|
|
Three-Month Period
Ended
June 30, 2014
|
% of Total
|
Three-Month Period
Ended
June 30, 2013
|
% of Total
|
|
|
RMB
|
US$
|
RMB
|
Sales in
China
|
|
58,873
|
9,490
|
84.1%
|
67,906
|
87.7%
|
Sales in other
countries
|
|
11,111
|
1,791
|
15.9%
|
9,495
|
12.3%
|
|
|
|
|
|
|
|
|
|
69,984
|
11,281
|
100.0%
|
77,401
|
100.0%
|
Our gross loss was RMB9.5 million
or US$1.5 million for the second
quarter ended June 30, 2014,
representing a gross loss rate of 13.6%, as compared to a gross
loss rate of 3.0% for the same period in 2013. Correspondingly,
gross loss rate increased by 10.6 percentage points compared to the
same period in 2013. Our average product sales prices decreased by
14.0% compared to the same period last year while the average cost
of goods sold decreased by 5.1% compared to the same period last
year. Consequently, the amount of decrease in sales revenue was
greater than the decrease in the cost of goods sold during the
second quarter ended June 30, 2014
compared with the same period in 2013, which resulted in an
increase in gross loss.
Operating expenses for the second quarter ended June 30, 2014 were RMB10.4
million or US$1.7 million,
which was RMB3.2 million, or 23.5%
lower than the same period in 2013. This decrease was mainly due to
decreased R&D expenditure on new products in the second quarter
of 2014.
Net loss attributable to the Company during the second quarter
ended June 30, 2014 was RMB23.0 million or US$3.7
million compared to net loss attributable to the Company of
RMB18.2 million during the same
period in 2013, representing an increase of RMB4.8 million for the same period in 2013.
Basic and diluted net loss per share was RMB1.76 or US$0.28
and RMB1.39 for the three months
ended June 30, 2014 and 2013,
respectively.
Total shareholders' equity was RMB424.0
million or US$68.4 million as
of June 30, 2014, compared with
RMB460.3 million as of December 31, 2013.
As of June 30, 2014, the Company
had 13,062,500 basic and diluted total ordinary shares
outstanding.
Conference Call Information
The Company will host a teleconference on Friday, August 22, 2014, at 9:00 a.m. EDT / 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 +1-877-660-6853 in North
America, or +1-201-612-7415 internationally, and entering
the following Conference ID: 13588942. The replay will be available
until September 22, 2014, at
11:59 p.m. EDT.
About Fuwei Films
Fuwei Films conducts its business through its wholly owned
subsidiary, Fuwei Films (Shandong)
Co., Ltd. ("Fuwei Shandong"). Fuwei Shandong develops, manufactures
and distributes high-quality plastic films using the biaxial
oriented stretch technique, otherwise known as BOPET film
(biaxially oriented polyethylene terephthalate). Fuwei's BOPET film
is widely used to package food, medicine, cosmetics, tobacco, and
alcohol, as well as in the imaging, electronics, and magnetic
products industries.
Safe Harbor
This press release contains information that constitutes
forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995
and are subject to risks. Risk factors that could contribute to
such differences include those matters more fully disclosed in the
Company's reports filed with the U.S. Securities and Exchange
Commission which, among other things, include both the short and
long-term effects of the global financial crisis on the Company and
the BOPET film industry; competition in the BOPET film industry;
growth of, and risks inherent in, the BOPET film industry in
China; uncertainty as to future
profitability and our ability to obtain adequate financing for our
planned capital expenditure requirements; uncertainty as to our
ability to continuously develop new BOPET film products and keep up
with changes in BOPET film technology; risks associated with
possible defects and errors in our products; uncertainty as to our
ability to protect and enforce our intellectual property rights;
uncertainty as to our ability to attract and retain qualified
executives and personnel; and uncertainty in acquiring raw
materials on time and on acceptable terms, particularly in view of
the volatility in the prices of petroleum products in recent years.
The forward-looking information provided herein represents the
Company's estimates as of the date of the press release, and
subsequent events and developments may cause the Company's
estimates to change. The Company specifically disclaims any
obligation to update the forward-looking information in the future.
Therefore, this forward-looking information should not be relied
upon as representing the Company's estimates of its future
financial performance as of any date subsequent to the date of this
press release. Actual results of our operations may differ
materially from information contained in the forward-looking
statements as a result of the risk factors.
For more information, please contact:
In China:
Ms Xiaoli Yu
Investor Relations Officer
Phone: +86-133-615-59266
Email: fuweiIR@fuweifilms.com
In the U.S.:
Ms. Vivian Chen
Investor Relations
Grayling
Phone: +1-646-284-9427
Email: vivian.chen@grayling.com
Financial Tables to Follow
FUWEI FILMS
(HOLDINGS) CO., LTD. AND SUBSIDIARIES
CONDENSED
CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30,
2014 AND DECEMBER 31, 2013
(amounts in thousands
except share and per share value)
(Unaudited)
|
|
|
June 30,
2014
|
|
December 31,
2013
|
|
RMB
|
US$
|
|
RMB
|
ASSETS
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
5,478
|
883
|
|
11,578
|
Restricted
cash
|
|
41,787
|
6,736
|
|
41,422
|
Accounts and bills
receivable, net
|
|
7,337
|
1,183
|
|
8,373
|
Inventories
|
|
32,513
|
5,241
|
|
38,454
|
Advance to
suppliers
|
|
6,868
|
1,107
|
|
6,977
|
Prepayments and other
receivables
|
|
25,052
|
4,038
|
|
26,107
|
Deferred tax assets -
current
|
|
1,670
|
269
|
|
1,702
|
Total current
assets
|
|
120,705
|
19,457
|
|
134,613
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
505,569
|
81,496
|
|
524,777
|
Construction in
progress
|
|
366
|
59
|
|
632
|
Lease prepayments,
net
|
|
18,667
|
3,009
|
|
18,999
|
Advance to suppliers
- long term, net
|
|
2,945
|
475
|
|
2,134
|
Long-term
deposit
|
|
16,760
|
2,702
|
|
16,760
|
Other
Assets
|
|
12,947
|
2,087
|
|
13,244
|
Deferred tax assets -
non current
|
|
20,817
|
3,356
|
|
20,888
|
|
|
|
|
|
|
Total
assets
|
|
698,776
|
112,641
|
|
732,047
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
Current
liabilities
|
|
|
|
|
|
Short-term
borrowings
|
|
-
|
-
|
|
105,000
|
Long-term loan,
current portion
|
|
1,675
|
270
|
|
-
|
Due to related
parties
|
|
120,000
|
19,344
|
|
-
|
Accounts
payables
|
|
35,872
|
5,782
|
|
33,454
|
Notes
payable
|
|
78,200
|
12,606
|
|
81,990
|
Advance from
customers
|
|
7,114
|
1,147
|
|
14,665
|
Accrued expenses and
other payables
|
7,956
|
1,282
|
|
6,777
|
Obligations under
capital leases-current
|
|
8,587
|
1,384
|
|
8,314
|
Total current
liabilities
|
|
259,404
|
41,815
|
|
250,200
|
|
|
|
|
|
|
Obligations under
capital leases
|
|
4,200
|
677
|
|
8,563
|
Long-term
loan
|
|
8,325
|
1,342
|
|
10,000
|
Deferred tax
liabilities
|
|
3,613
|
582
|
|
3,736
|
|
|
|
|
|
|
Total
liabilities
|
|
275,542
|
44,416
|
|
272,499
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
Registered capital(of
US$0.129752 par value; 20,000,000 shares authorized; 13,062,500
issued and outstanding)
|
|
13,323
|
2,148
|
|
13,323
|
Additional paid-in
capital
|
|
311,907
|
50,278
|
|
311,907
|
Statutory
reserve
|
|
37,441
|
6,035
|
|
37,441
|
Retained
earnings
|
|
60,130
|
9,693
|
|
96,370
|
Cumulative
translation adjustment
|
|
1,211
|
196
|
|
1,266
|
Total
shareholders' equity
|
|
424,012
|
68,350
|
|
460,307
|
Non-controlling
interest
|
|
(778)
|
(125)
|
|
(759)
|
Total
equity
|
|
423,234
|
68,225
|
|
459,548
|
Total liabilities
and equity
|
|
698,776
|
112,641
|
|
732,047
|
FUWEI FILMS
(HOLDINGS) CO., LTD. AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(LOSS)
FOR THE THREE- AND
SIX-MONTH PERIODS ENDED JUNE 30, 2014 AND 2013
(amounts in thousands
except share and per share value)
(Unaudited)
|
|
|
|
The Three-Month
Period Ended June 30,
|
|
The Six-Month
Period Ended June 30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
RMB
|
US$
|
|
RMB
|
|
RMB
|
US$
|
|
RMB
|
Net sales
|
|
69,984
|
11,281
|
|
77,401
|
|
140,689
|
22,679
|
|
153,978
|
Cost of
sales
|
|
79,482
|
12,812
|
|
79,708
|
|
150,256
|
24,221
|
|
157,476
|
|
|
|
|
|
|
|
|
|
|
|
Gross loss
|
|
(9,498)
|
(1,531)
|
|
(2,307)
|
|
(9,567)
|
(1,542)
|
|
(3,498)
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
Selling
expenses
|
|
3,430
|
553
|
|
3,625
|
|
6,789
|
1,,094
|
|
7,970
|
Administrative
expenses
|
|
7,004
|
1,129
|
|
9,985
|
|
14,058
|
2,266
|
|
19,291
|
Total operating
expenses
|
|
10,434
|
1,682
|
|
13,610
|
|
20,847
|
3,360
|
|
27,261
|
|
|
|
|
|
|
|
|
|
|
|
Operating
loss
|
|
(19,932)
|
(3,213)
|
|
(15,917)
|
|
(30,414)
|
(4,902)
|
|
(30,759)
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
|
|
- Interest
income
|
|
260
|
42
|
|
281
|
|
640
|
103
|
|
342
|
- Interest
expense
|
|
(3,256)
|
(525)
|
|
(2,664)
|
|
(6,424)
|
(1,036)
|
|
(5,881)
|
- Others income
(expense), net
|
|
25
|
4
|
|
(27)
|
|
(63)
|
(10)
|
|
(128)
|
|
|
|
|
|
|
|
|
|
|
|
Total other
expense
|
|
(2,971)
|
(479)
|
|
(2,410)
|
|
(5,847)
|
(943)
|
|
(5,667)
|
|
|
|
|
|
|
|
|
|
|
|
Loss before provision
for income taxes
|
|
(22,903)
|
(3,692)
|
|
(18,327)
|
|
(36,261)
|
(5,845)
|
|
(36,426)
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit
(expense)
|
|
(79)
|
(13)
|
|
136
|
|
20
|
3
|
|
159
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
(22,982)
|
(3,705)
|
|
(18,191)
|
|
(36,241)
|
(5,842)
|
|
(36,267)
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
attributable to noncontrolling interests
|
|
(1)
|
0
|
|
(1)
|
|
(1)
|
0
|
|
(1)
|
Net loss attributable
to the Company
|
|
(22,981)
|
(3,705)
|
|
(18,190)
|
|
(36,240)
|
(5,842)
|
|
(36,266)
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss)
|
|
|
|
|
|
|
|
|
|
|
- Foreign currency
translation adjustments attributable to noncontrolling
interest
|
|
1
|
0
|
|
10
|
|
(19)
|
(3)
|
|
12
|
- Foreign currency
translation adjustments attributable to the Company
|
|
(7)
|
(1)
|
|
19
|
|
(55)
|
(9)
|
|
30
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income
(loss) attributable to non-controlling interest
|
|
0
|
0
|
|
9
|
|
(20)
|
(3)
|
|
11
|
Comprehensive loss
attribute to the Company
|
|
(22,988)
|
(3,706)
|
|
(18,171)
|
|
(36,295)
|
(5,851)
|
|
(36,236)
|
|
|
|
|
|
|
|
|
|
|
|
Loss per share,
Basic and diluted
|
|
(1.76)
|
(0.28)
|
|
(1.39)
|
|
(2.77)
|
(0.45)
|
|
(2.78)
|
Weighted average
number ordinary shares,
Basic and diluted
|
|
13,062,500
|
13,062,500
|
|
13,062,500
|
|
13,062,500
|
13,062,500
|
|
13,062,500
|
FUWEI FILMS
(HOLDINGS) CO., LTD. AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX-MONTH
PERIODS ENDED JUNE 30, 2014 AND 2013
(amounts in thousands
except share and per share value)
(Unaudited)
|
|
|
The Six-Month
Period Ended June 30,
|
|
|
2014
|
|
2013
|
|
|
RMB
|
US$
|
|
RMB
|
Cash flow from
operating activities
|
|
|
|
|
|
Net loss
|
|
(36,241)
|
(5,842)
|
|
(36,267)
|
Adjustments to
reconcile net loss to net cash
|
|
|
|
|
|
(used in) provided by
operating activities
|
|
|
|
|
|
- Gain on disposal of
property, plant and equipment
|
|
-
|
-
|
|
-
|
- Depreciation of
property, plant and equipment
|
|
24,031
|
3,874
|
|
24,353
|
- Amortization of
intangible assets
|
|
262
|
42
|
|
262
|
- Deferred income
taxes
|
|
(20)
|
(3)
|
|
(159)
|
- Bad debt expense
(recovery)
|
|
(115)
|
(19)
|
|
1,495
|
Changes in operating
assets and liabilities
|
|
|
|
|
|
- Accounts and bills
receivable
|
|
1,150
|
185
|
|
6,797
|
-
Inventories
|
|
5,942
|
958
|
|
(14,526)
|
- Advance to
suppliers
|
|
109
|
18
|
|
8,701
|
- Prepaid expenses and
other current assets
|
|
(814)
|
(131)
|
|
(1,916)
|
- Accounts
payable
|
|
2,418
|
390
|
|
(1,641)
|
- Accrued expenses and
other payables
|
|
1,116
|
180
|
|
(291)
|
- Advance from
customers
|
|
(7,551)
|
(1,217)
|
|
4,402
|
- Tax
payable
|
|
2,236
|
360
|
|
(2,408)
|
|
|
|
|
|
|
Net cash used in
operating activities
|
|
(7,477)
|
(1,205)
|
|
(11,198)
|
|
|
|
|
|
|
Cash flow from
investing activities
|
|
|
|
|
|
Purchases of
property, plant and equipment
|
|
(4,823)
|
(777)
|
|
(244)
|
Restricted cash
related to trade finance
|
|
(357)
|
(58)
|
|
(26,298)
|
Advanced to suppliers
- non current
|
|
(811)
|
(131)
|
|
(2,288)
|
Amount change in
construction in progress
|
|
265
|
43
|
|
(3,559)
|
Proceeds from sale of
property, plant and equipment
|
|
-
|
-
|
|
-
|
|
|
|
|
|
|
Net cash used in
investing activities
|
|
(5,726)
|
(923)
|
|
(32,389)
|
|
|
|
|
|
|
Cash flow from
financing activities
|
|
|
|
|
|
Principal payments of
short-term bank loans
|
|
(105,000)
|
(16,926)
|
|
(110,000)
|
Proceeds from
short-term bank loans
|
|
-
|
-
|
|
107,032
|
Proceeds from related
party
|
|
120,000
|
19,344
|
|
-
|
Payment of capital
lease obligation
|
|
(4,090)
|
(659)
|
|
(4,164)
|
Change in notes
payable
|
|
(3,790)
|
(611)
|
|
49,886
|
Proceeds from
sale-leaseback equipment
|
|
-
|
-
|
|
5,000
|
|
|
|
|
|
|
Net cash provided by
financing activities
|
|
7,120
|
1,148
|
|
47,754
|
|
|
|
|
|
|
Effect of foreign
exchange rate changes
|
|
(17)
|
(50)
|
|
(6)
|
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalent
|
|
(6,100)
|
(1,030)
|
|
4,161
|
|
|
|
|
|
|
Cash and cash
equivalent
|
|
|
|
|
|
At beginning of
period
|
|
11,578
|
1,913
|
|
5,006
|
At end of
period
|
|
5,478
|
883
|
|
9,167
|
|
|
|
|
|
|
SUPPLEMENTARY
DISCLOSURE:
|
|
|
|
|
|
Interest
paid
|
|
6,424
|
1,036
|
|
5,881
|
Income tax
paid
|
|
-
|
-
|
|
-
|
|
|
|
|
|
|
SUPPLEMENTARY
SCHEDULE OF NONCASH INVESTING AND FINANCIAL
ACTIVITIES:
|
Account payable for
plant and equipment:
|
|
7,883
|
1,271
|
|
6,220
|
Obligations for
acquired equipment under capital lease:
|
|
12,787
|
2,061
|
|
20,836
|
SOURCE Fuwei Films (Holdings) Co., Ltd.