BEIJING, May 19, 2016 /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 first quarter of
2016 ended March 31, 2016.
Highlights
Net sales during the first quarter ended March 31, 2016 were RMB62.1 million or US$9.6
million, compared to RMB52.8
million during the same period in 2015, representing an
increase of RMB9.3 million or
17.6%.
Net loss attributable to the Company during the first quarter
ended March 31, 2016 was RMB12.1 million or US$1.9
million compared to a net loss attributable to the Company
of RMB15.0 million during the same
period in 2015, representing a decrease of RMB2.9 million.
Basic and diluted net loss per share was RMB0.92 or US$0.14
and RMB1.15 for the three-month
period ended March 31, 2016 and 2015,
respectively.
Gross profit was RMB5.6 million or
US$0.9 million for the first quarter
ended March 31, 2016, representing a
gross margin of 9.0%, as compared to a gross loss margin of 14.8%
for the same period in 2015. Correspondingly, the gross margin rate
increased by 23.8 percentage points compared to the same period in
2015.
Mr. Zengyong Wang, Chairman and CEO of Fuwei Films, commented,
"The first quarter financial results reflected encouraging results
in revenues due to sales in specialty films which contributed to an
increase in volumes that also led to improved margins despite
weakened market conditions due to significant competition which
caused oversupply and excess capacity in the marketplace. We
believe that our focus on continued innovation and R&D will
enable the Company to expand end-user applications and our high-end
specialty films while increasing the product portfolio, which we
believe will help us to attract new clients and expand
relationships with existing customers. We are encouraged by
positive trends in sales volume and gross margins that we expect to
enable us to weather different industry and economic conditions in
the periods ahead."
First Quarter 2016
Results
Net sales during the first quarter ended March 31, 2016 were RMB62.1 million or US$9.6
million, compared to RMB52.8
million, during the same period in 2015, representing an
increase of RMB9.3 million or 17.6%,
mainly due to the increased sales volume.
In the first quarter of 2016, sales of specialty films were
RMB21.8 million or US$3.4 million or 35.0% of our total revenues as
compared to RMB15.0 million or 28.5%
in the same period of 2015. The increase was largely attributable
to the increase in sales volume for dry films and coated films.
Overseas sales were RMB12.5
million or US$1.9 million, or
20.1% of total revenues, compared with RMB13.1 million or 24.8% of total revenues in the
first quarter of 2015, representing a decrease of RMB0.6 million or 4.6%. The decrease in overseas
sales was mainly due to the reduction of sales price.
The following is a breakdown of PRC domestic and overseas sales
(amounts in thousands except percentages):
|
|
Three-Month
Period
Ended
March 31, 2016
|
% of Total
|
Three-Month
Period
Ended
March 31, 2015
|
% of Total
|
|
|
RMB
|
US$
|
RMB
|
Sales in
China
|
|
49,632
|
7,697
|
79.9%
|
39,696
|
75.2%
|
Sales in other
countries
|
|
12,515
|
1,941
|
20.1%
|
13,080
|
24.8%
|
|
|
|
|
|
|
|
|
|
62,147
|
9,638
|
100.0%
|
52,776
|
100.0%
|
Our gross profit was RMB5.6
million or US$0.9 million for
the first quarter ended March 31,
2016, representing a gross margin of 9.0%, as compared to a
gross loss margin of 14.8% for the same period in 2015.
Correspondingly, gross margin rate increased by 23.8 percentage
points compared to the same period in 2015. Our average product
sales prices decreased by 2.0% compared to the same period in 2015
while the average cost of goods sold decreased by 22.3% compared to
the same period last year, which contributed to the increase in our
gross margin compared with the same period in 2015.
Operating expenses for the first quarter ended March 31, 2016 were RMB15.0 million or US$2.3
million, which was RMB6.2
million, or 70.5% higher than the same period in 2015. This
increase was mainly due to the accounting treatment that allocated
certain amount of fixed overhead from cost of goods sold to general
and administrative expense due to the fact that our third
production line has not been able to continue its production since
April 2015, in addition to the
increased allowance for doubtful accounts receivable.
Net loss attributable to the Company during the first quarter
ended March 31, 2016 was RMB12.1 million or US$1.9
million compared to net loss attributable to the Company of
RMB15.0 million during the same
period in 2015, representing a decrease of RMB2.9 million.
Basic and diluted net loss per share was RMB0.92 or US$0.14
and RMB1.15 for the three-month
period ended March 31, 2016 and 2015,
respectively.
Total shareholders' equity was RMB307.6
million or US$47.7 million as
of March 31, 2016, compared with
RMB319.7
million as of December 31, 2015.
As of March 31, 2016, the Company
had 13,062,500 basic and diluted ordinary shares outstanding.
Conference Call Information
The Company will host a teleconference on Friday, May 20, 2016, 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: 13637379. The replay will be available
until June 20, 2016, 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; 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 operate its third 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.:
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 MARCH 31,
2016 AND DECEMBER 31, 2015
(amounts in thousands
except share and per share value)
(Unaudited)
|
|
|
March 31,
2016
|
|
December 31,
2015
|
|
RMB
|
US$
|
|
RMB
|
ASSETS
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
|
9,429
|
1,462
|
|
14,355
|
Restricted
cash
|
|
46,628
|
7,231
|
|
43,215
|
Accounts and bills
receivable, net
|
|
21,948
|
3,404
|
|
10,046
|
Inventories
|
|
24,389
|
3,782
|
|
29,574
|
Advance to
suppliers
|
|
5,598
|
868
|
|
5,640
|
Prepayments and other
receivables
|
|
10,696
|
1,659
|
|
20,334
|
Deferred tax assets -
current
|
|
1,812
|
281
|
|
1,438
|
Total current
assets
|
|
120,500
|
18,687
|
|
124,602
|
|
|
|
|
|
|
Plant, properties and
equipment, net
|
|
431,462
|
66,914
|
|
431,021
|
Construction in
progress
|
|
3,895
|
604
|
|
1,700
|
Lease prepayments,
net
|
|
17,750
|
2,753
|
|
17,882
|
Advance to suppliers
- long term, net
|
|
1,244
|
193
|
|
1,440
|
Long-term
deposit
|
|
-
|
-
|
|
-
|
Other
Assets
|
|
-
|
-
|
|
11,607
|
Deferred tax assets -
non current
|
|
15,460
|
2,398
|
|
15,519
|
|
|
|
|
|
|
Total
assets
|
|
590,311
|
91,549
|
|
603,771
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
Current
liabilities
|
|
|
|
|
|
Long-term loan,
current portion
|
|
3,350
|
520
|
|
3,350
|
Due to related
parties
|
|
144,664
|
22,435
|
|
143,080
|
Accounts
payables
|
|
30,361
|
4,709
|
|
32,760
|
Notes
payable
|
|
87,050
|
13,500
|
|
85,780
|
Advance from
customers
|
|
1,898
|
294
|
|
2,247
|
Accrued expenses and
other payables
|
7,577
|
1,175
|
|
8,682
|
Obligations under
capital leases-current
|
|
-
|
-
|
|
302
|
Total current
liabilities
|
|
274,900
|
42,633
|
|
276,201
|
|
|
|
|
|
|
Obligations under
capital leases
|
|
-
|
-
|
|
-
|
Long-term
loan
|
|
3,300
|
512
|
|
3,300
|
Deferred tax
liabilities
|
|
5,303
|
822
|
|
5,406
|
|
|
|
|
|
|
Total
liabilities
|
|
283,503
|
43,967
|
|
284,907
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
Registered capital(of
US$0.129752 par value; 20,000,000 shares authorized; 13,062,500
issued and outstanding)
|
|
13,323
|
2,066
|
|
13,323
|
Additional paid-in
capital
|
|
311,907
|
48,373
|
|
311,907
|
Statutory
reserve
|
|
37,441
|
5,807
|
|
37,441
|
Retained
earnings
|
|
(56,077)
|
(8,697)
|
|
(44,022)
|
Cumulative
translation adjustment
|
|
1,044
|
162
|
|
1,049
|
Total
shareholders' equity
|
|
307,638
|
47,711
|
|
319,698
|
Non-controlling
interest
|
|
(830)
|
(129)
|
|
(834)
|
Total
equity
|
|
306,808
|
47,582
|
|
318,864
|
Total liabilities
and equity
|
|
590,311
|
91,549
|
|
603.711
|
FUWEI FILMS
(HOLDINGS) CO., LTD. AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS
FOR THE
THREE-MONTH PERIOD ENDED MARCH 31, 2016 AND 2015
(amounts in thousands
except share and per share value)
(Unaudited)
|
|
|
The Three-Month
Period
Ended March 31,
|
|
|
2016
|
|
2015
|
|
RMB
|
US$
|
|
RMB
|
Net sales
|
|
62,147
|
9,638
|
|
52,776
|
Cost of
sales
|
|
56,558
|
8,771
|
|
60,601
|
|
|
|
|
|
|
Gross margin
(loss)
|
|
5,589
|
867
|
|
(7,825)
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
Selling
expenses
|
|
2,949
|
457
|
|
3,196
|
Administrative
expenses
|
|
12,048
|
1,868
|
|
5,613
|
Total operating
expenses
|
|
14,997
|
2,325
|
|
8,809
|
|
|
|
|
|
|
Operating
loss
|
|
(9,408)
|
(1,458)
|
|
(16,634)
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
- Interest
income
|
|
218
|
34
|
|
520
|
- Interest
expense
|
|
(1,754)
|
(272)
|
|
(2,331)
|
- Others (expense)
income, net
|
|
(1,529)
|
(237)
|
|
4,484
|
|
|
|
|
|
|
Total other income
(expense)
|
|
(3,065)
|
(475)
|
|
2,673
|
|
|
|
|
|
|
Loss before provision
for income taxes
|
|
(12,473)
|
(1,933)
|
|
(13,961)
|
|
|
|
|
|
|
Income tax
benefit(expense)
|
|
418
|
65
|
|
(1,036)
|
|
|
|
|
|
|
Net
loss
|
|
(12,055)
|
(1,868)
|
|
(14,997)
|
|
|
|
|
|
|
Net loss attributable
to non-controlling interests
|
|
-
|
-
|
|
-
|
Net loss attributable
to the Company
|
|
(12,055)
|
(1,868)
|
|
(14,997)
|
|
|
|
|
|
|
Other comprehensive
income
|
|
|
|
|
|
- Foreign currency
translation adjustments attributable to non-controlling
interest
|
|
4
|
1
|
|
-
|
- Foreign currency
translation adjustments attributable to the Company
|
|
(5)
|
(1)
|
|
(24)
|
|
|
|
|
|
|
Comprehensive loss
attributable to non-controlling interest
|
|
4
|
1
|
|
-
|
Comprehensive loss
attributable to the Company
|
|
(12,060)
|
(1,869)
|
|
(15,021)
|
|
|
|
|
|
|
Loss per share,
Basic and diluted
|
|
(0.92)
|
(0.14)
|
|
(1.15)
|
Weighted average
number ordinary shares,
Basic and diluted
|
|
13,062,500
|
13,062,500
|
|
13,062,500
|
FUWEI FILMS
(HOLDINGS) CO., LTD. AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE
THREE-MONTH PERIOD ENDED MARCH 31, 2016 AND 2015
(amounts in thousands
except share and per share value)
(Unaudited)
|
|
|
The Three-Month
Period Ended March 31,
|
|
|
2016
|
|
2015
|
|
|
RMB
|
US$
|
|
RMB
|
Cash flow from
operating activities
|
|
|
|
|
|
Net loss
|
|
(12,055)
|
(1,870)
|
|
(14,997)
|
Adjustments to
reconcile net loss to net cash
|
|
|
|
|
|
used in operating
activities
|
|
|
|
|
|
- Loss on disposal of
property, plant and equipment
|
|
|
|
|
4
|
- Depreciation of
property, plant and equipment
|
|
10,668
|
1,654
|
|
11,888
|
- Amortization of
intangible assets
|
|
131
|
20
|
|
132
|
- Deferred income
taxes
|
|
(418)
|
(65)
|
|
1,036
|
- Bad debt
expense
|
|
1,723
|
267
|
|
(4,319)
|
-Inventory
provision
|
|
(226)
|
(35)
|
|
-
|
Changes in operating
assets and liabilities
|
|
|
|
|
|
- Accounts and bills
receivable
|
|
(13,623)
|
(2,113)
|
|
2,535
|
-
Inventories
|
|
5,411
|
839
|
|
(2,637)
|
- Advance to
suppliers
|
|
42
|
7
|
|
4,211
|
- Prepaid expenses and
other current assets
|
|
(373)
|
(58)
|
|
(377)
|
- Accounts
payable
|
|
(2,399)
|
(372)
|
|
(4,962)
|
- Accrued expenses and
other payables
|
|
(1,087)
|
(169)
|
|
1,155
|
- Advance from
customers
|
|
(349)
|
(54)
|
|
132
|
- Tax
payable
|
|
10,012
|
1,553
|
|
(1,475)
|
|
|
|
|
|
|
Net cash used in
operating activities
|
|
(2,543)
|
(396)
|
|
(7,674)
|
|
|
|
|
|
|
Cash flow from
investing activities
|
|
|
|
|
|
Purchases of
property, plant and equipment
|
|
498
|
77
|
|
22
|
Restricted cash
related to trade finance
|
|
(3,414)
|
(529)
|
|
17,084
|
Advanced to suppliers
- non current
|
|
196
|
30
|
|
86
|
Amount change in
construction in progress
|
|
(2,195)
|
(340)
|
|
(680)
|
Return of long-term
deposit
|
|
-
|
-
|
|
21,000
|
|
|
|
|
|
|
Net cash used in
investing activities
|
|
(4,915)
|
(762)
|
|
37,512
|
|
|
|
|
|
|
Cash flow from
financing activities
|
|
|
|
|
|
Proceeds from related
party
|
|
1,583
|
246
|
|
3,993
|
Payment of capital
lease obligation
|
|
(302)
|
(47)
|
|
(2,165)
|
Change in notes
payable
|
|
1,270
|
197
|
|
(34,159)
|
|
|
|
|
|
|
Net cash (used in)
provided by financing activities
|
|
2,551
|
396
|
|
(32,331)
|
|
|
|
|
|
|
Effect of foreign
exchange rate changes
|
|
(19)
|
8
|
|
(28)
|
|
|
|
|
|
|
Net decrease in cash
and cash equivalent
|
|
(4,926)
|
(754)
|
|
(2,521)
|
|
|
|
|
|
|
Cash and cash
equivalent
|
|
|
|
|
|
At beginning of
period/year
|
|
14,355
|
2,216
|
|
9,020
|
At end of
period/year
|
|
9,429
|
1,462
|
|
6,499
|
|
|
|
|
|
|
SUPPLEMENTARY
DISCLOSURE:
|
|
|
|
|
|
Interest
paid
|
|
1,754
|
272
|
|
2,331
|
Income tax
paid
|
|
-
|
-
|
|
-
|
|
|
|
|
|
|
SUPPLEMENTARY
SCHEDULE OF NONCASH INVESTING AND FINANCIAL
ACTIVITIES:
|
Account payable for
plant and equipment:
|
|
2,121
|
329
|
|
2,266
|
Obligations for
acquired equipment under capital lease:
|
|
-
|
-
|
|
6,397
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/fuwei-films-announces-its-unaudited-financial-results-for-the-first-quarter-of-2016-300271685.html
SOURCE Fuwei Films (Holdings) Co., Ltd.