XI'AN, China, March 24, 2014 /PRNewswire/ -- China Housing & Land Development, Inc. ("China Housing" or the "Company"; Nasdaq: CHLN) today announced its financial results for the quarter ended December 31, 2013.
Highlights for Q4 2013:
Mr. Pingji Lu, China Housing's Chairman, commented, "Our fourth financial performance was better than our original guidance forecast. The increase was due to a completion percentage that was higher than our expectation, resulting in greater recognized revenue in the fourth quarter. The majority of our fourth quarter revenue was generated by our Park Plaza, Puhua Phase Three and Ankang projects."
"We are making progress balancing our unit inventory more effectively so that we can offer a broader array of apartment units to prospective low, mid and high end buyers. Ensuring greater unit availability in each of these tiers is important as we face more challenging conditions as overall market demand appears to be softening. For our projects under planning, we're actively observing buyer patterns so we can accelerate the most relevant projects by unit category to adequately suit buyer demand. Despite an uncertain market environment, we believe our current broader category of inventory can better meet the market demand," concluded Chairman Lu.
Total revenue in the fourth quarter of 2013 increased 126.2% to $56.1 million from $24.8 million in the third quarter of 2013 and decreased 8.8% from $61.5 million in the fourth quarter of 2012. Other revenue in the fourth quarter of 2013 was $8.9 million, compared to $3.8 million in the third quarter of 2013 and $21.3 million in the fourth quarter of 2012.
In the fourth quarter of 2013, the majority of the Company's real estate revenue came from its Puhua Phase Two and Three projects, Park Plaza and Ankang projects. Fourth quarter 2013 contract sales totaled $31.0 million compared with $18.6 million in the third quarter of 2013 and $22.9 million in the fourth quarter of 2012. Total gross floor area ("GFA") sales were 28,582 sq. meters during the fourth quarter of 2013, compared with 17,847 sq. meters in the third quarter of 2013 and 27,853 sq. meters in the fourth quarter of 2012. The Company's ASP in the fourth quarter of 2013 was RMB 6,600, compared with RMB 6,369 in the third quarter of 2013, and RMB 5,137 in the fourth quarter of 2012.
Gross profit for the three months ended December 31, 2013 was $12.6 million, representing an increase of 157.1% from $4.9 million in the third quarter of 2013 and a 40.3% decrease from $21.1 million in the fourth quarter of 2012. Gross profit margin for the three months ended December 31, 2013 was 22.4%, compared to 19.8% in the third quarter of 2013 and the 34.3% in the fourth quarter of 2012. The year-over-year decrease in gross profit margin was mainly due to an adjustment on the total estimate cost of Park Plaza, Puhua Phase Two and Three projects, of which the accumulated impacted was recorded in the fourth quarter of 2013 For the full 2013 year, gross margin was 22.4%.
SG&A expense was $5.1 million in the fourth quarter of 2013, compared with $3.8 million in the third quarter of 2013 and $5.7 million in the fourth quarter of 2012. SG&A expense as a percentage of total revenue was 9.1%, compared with 15.2% in the third quarter of 2013 and 9.3% in the fourth quarter of 2012. The year-over-year decrease in SG&A expense was mainly due to lower advertising expense and decreased sales commission associated with decreased revenue. .
Operating income in the fourth quarter of 2013 was $6.0 million compared to an operating loss of $0.7 million in the third quarter of 2013, and operating income of $14.8 million in the fourth quarter of 2012. The year-over-year decrease in operating income was mainly due to reduced sales revenue and lower profit margin.
Net income attributable to China Housing in the fourth quarter of 2013 was $3.9 million, or $0.11 per diluted share. This performance compares with net loss of $0.8 million, or $(0.02) per diluted share, in the third quarter of 2013 and net income of $11.5 million, or $0.33 per diluted share, in the fourth quarter of 2012.
Sequential Quarterly Revenue Breakout Comparison
Project | Q4 2013 | Q3 2013 | ||||||||
Recognized Revenue | Contract Sales | GFA Sold | ASP | Unsold GFA | POC | Recognized Revenue | Contract Sales | GFA Sold | ASP | |
($) | ($) | (m2) | (RMB) | (m2) | ($) | ($) | (m2) | (RMB) | ||
Projects Under Construction | ||||||||||
Park Plaza | 17,872,157 | 9,946,924 | 6,942 | 8,727 | 56,617 | 83.23% | 6,541,366 | 5,659,081 | 4,002 | 8,661 |
Puhua Phase Three | 11,454,315 | 6,111,757 | 5,511 | 6,754 | 62,296 | 65.3% | 3,449,098 | 3,685,035 | 3,675 | 6,143 |
Puhua Phase | 6,366,008 | 4,739,552 | 4,066 | 7,099 | 91,389 | 83.22% | 5,979,885 | 3,470,786 | 3,240 | 6,560 |
Ankang | 9,317,653 | 6,145,128 | 9,374 | 3,992 | 190,659 | 41.44% | 3,304,218 | 3,571,860 | 5,474 | 4,000 |
Projects Completed | ||||||||||
Puhua Phase One | 170,343 | 1,354,140 | 954 | 8.641 | 5,695 | 100% | 642,927 | 889,021 | 662 | 8,232 |
Puhua Phase | 2,024,106 | 2,679,234 | 1,736 | 9,399 | 31,132 | 100% | 231,686 | 387,717 | 327 | 7,264 |
JunJing III | -73,562 | - | - | - | 1,039 | 100% | -116,995 | -116,995 | -166 | -- |
JunJing II | - | - | - | - | 518 | 100% | 481,746 | 481,746 | 299 | 9,855 |
JunJing I | - | - | - | - | 4,366 | 100% | 528,465 | 528,465 | 333 | 9,277 |
Other Projects | - | - | - | - | - | - | - | |||
Other Income | 8,927,863 | 3,788,434 | - | - | ||||||
Total | 56,058,883 | 30,976,735 | 28,583 | 6,600 | 443,711 | - | 24,830,830 | 18,556,716 | 17,846 | 6,369 |
Q-o-Q Change | 125.8% | 66.9% | 60.2% | 3.6% | -57% | -68.6% | -63.2% | -15.1% | ||
Total debt outstanding as of December 31, 2013 was $300.7 million compared with $202.6 million on December 31, 2012. Net debt outstanding (total debt less cash and restricted cash) as of December 31, 2013 was $161.8 million compared with $85.9 million on December 31, 2012. The Company's net debt as a percentage of total capital (net debt plus shareholders' equity) was 54 percent on December 31, 2013 and 41.7 percent on December 31, 2012.
Q4 2013 | ||
Projects in Planning | Unsold GFA | First Pre-sales |
(m2) | ||
Golden Bay | 250,000 | Q3 2014 |
Puhua Phase Four | 263,833 | Q1 2014 |
Textile City | 630,000 | Q1 2015 |
Total projects in planning | 1,143,833 | |
2014 First Quarter Outlook guidance
Total recognized revenue for the 2014 first quarter is expected to reach $15 million to $17 million, compared with $54.4 million in the first quarter of 2013. The Company is reporting revenues, which are subject to percentage of completion alterations.
Conference Call Information
Management will host a conference call at 8:00 am ET on Monday, March 24, 2014. Listeners may access the call by dialing +1-913-312-1267. To listen to the live webcast of the event, please go to http://public.viavid.com; event number: 108416. Listeners may access the call replay, which will be available through March 31, 2014, by dialing +1-858-384-5517; passcode: 5602978.
About China Housing & Land Development, Inc.
Based in Xi'an, the capital city of China's Shaanxi province, China Housing & Land Development, Inc., is a leading developer of residential and commercial properties in northwest China. China Housing has been engaged in land acquisition, development, and management, including the sales of residential and commercial real estate properties through its wholly-owned subsidiary in China, since 1992.
China Housing & Land Development is the first Chinese real estate development company traded on NASDAQ. The Company's news releases, project information, photographs, and more are available on the internet at www.chldinc.com.
Safe Harbor
This news release may contain forward-looking information about China Housing & Land Development, Inc. which is covered under the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts. These statements can be identified by the use of forward- looking terminology such as believe, expect, may, will, should, project, plan, seek, intend, or anticipate or the negative thereof or comparable terminology, and include discussions of strategy, and statements about industry trends and China Housing & Land Development's future performance, operations, and products.
Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Actual performance results may vary significantly from expectations and projections. Further information regarding this and other risk factors are contained in China Housing's public filings with the U.S. Securities and Exchange Commission.
All information provided in this news release and in any attachments is as of the date of the release, and the companies do not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under law.
China Housing contacts
Mr. Cangsang Huang
Chief Financial Officer
Tel: +86 29.8258.2648 in Xi'an
Email: chuang@chldinc.com
Ms. Jing Lu
Chief Operating Officer, Board Secretary, and Investor Relations Officer
Tel: +86 29.8258.2639 in Xi'an
Email: jinglu@chldinc.com / English and Chinese
Ms. Sandy Jin
Assistant CFO
Tel: +86 29.8258.2638 in Xi'an
Email: jinq@chldinc.com / English and Chinese
Mr. Bill Zima, ICR
Tel: +86 10 6583 7511
Email: William.Zima@icrinc.com
China Housing Investor Relations Department
Tel: +1 646.308.1285
CHINA HOUSING & LAND DEVELOPMENT, INC., AND SUBSIDIARIES As of December 31, 2013 and 2012 | ||||||
2013 | 2012 | |||||
ASSETS | ||||||
Cash | $ | 21,320,071 | $ | 6,121,448 | ||
Cash - restricted | 117,534,900 | 110,576,248 | ||||
Accounts receivable, net of allowance for doubtful | 41,158,998 | 26,429,332 | ||||
Construction in excess of billing | 2,106,975 | 1,484,626 | ||||
Other receivables, prepaid expenses and other assets, net | 7,188,153 | 6,854,325 | ||||
Real estate held for development or sale | 289,474,812 | 212,371,875 | ||||
Property and equipment, net | 36,281,168 | 33,837,346 | ||||
Advances to suppliers | 697,823 | 1,363,817 | ||||
Deposits on land use rights | 59,155,165 | 42,748,017 | ||||
Intangible assets, net | 42,453,473 | 54,482,252 | ||||
Goodwill | 1,969,964 | 1,914,186 | ||||
Deferred financing costs | 151,585 | 194,162 | ||||
Total assets | $ | 619,493,087 | $ | 498,377,634 | ||
LIABILITIES | ||||||
Accounts payable | $ | 59,400,262 | $ | 55,142,928 | ||
Advances from customers | 45,441,402 | 49,297,915 | ||||
Accrued expenses | 17,439,541 | 22,229,514 | ||||
Income tax payable | 24,534,095 | 19,865,906 | ||||
Other taxes payable | 7,139,870 | 3,861,158 | ||||
Other payables | 12,755,824 | 11,228,553 | ||||
Loans from employees | 25,759,453 | 27,868,785 | ||||
Loans payable | 274,917,332 | 174,749,368 | ||||
Deferred tax liability | 14,782,118 | 14,521,613 | ||||
Total liabilities | 482,169,897 | 378,765,740 | ||||
SHAREHOLDERS' EQUITY | ||||||
Common stock: $.001 par value, authorized 100,000,000 | 35,849 | 35,438 | ||||
Additional paid in capital | 51,347,620 | 49,972,174 | ||||
Treasury stock at cost; 1,166,369 shares and 351,480 | (2,400,288) | (434,240) | ||||
Statutory reserves | 11,535,242 | 9,903,457 | ||||
Retained earnings | 48,696,878 | 38,573,966 | ||||
Accumulated other comprehensive income | 28,107,889 | 21,561,099 | ||||
Total shareholders' equity | 137,323,190 | 119,611,894 | ||||
Total liabilities and shareholders' equity | $ | 619,493,087 | $ | 498,377,634 | ||
The accompanying notes are an integral part of these consolidated financial statements. | ||||||
CHINA HOUSING & LAND DEVELOPMENT, INC., AND SUBSIDIARIES
For The Years Ended December 31, 2013 and 2012 | |||||||
2013 | 2012 | ||||||
REVENUES | |||||||
Real estate sales | $ | 159,222,863 | $ | 115,299,428 | |||
Other revenue | 30,811,894 | 28,075,201 | |||||
Total revenues | 190,034,757 | 143,374,629 | |||||
COST OF REVENUES | |||||||
Cost of real estate sales | 124,152,403 | 78,612,305 | |||||
Cost of other revenue | 22,056,802 | 24,168,489 | |||||
Total cost of revenues | 146,209,205 | 102,780,794 | |||||
Gross margin | 43,825,552 | 40,593,835 | |||||
OPERATING EXPENSES | |||||||
Selling, general, and administrative expenses | 16,968,686 | 16,415,255 | |||||
Stock-based compensation | 1,375,857 | 1,010,875 | |||||
Other expenses | 400,247 | 122,651 | |||||
Financing expense | 7,317,008 | 557,336 | |||||
Accretion expense on convertible debt | - | 954,979 | |||||
Total operating expenses | 26,061,798 | 19,061,096 | |||||
CHANGE IN FAIR VALUE OF DERIVATIVES | |||||||
Change in fair value of embedded derivatives | - | (330,628) | |||||
Change in fair value of warrants | - | (4,162) | |||||
Total change in fair value of derivatives | - | (334,790) | |||||
Loss (gain) from disposal of property and equipment | 1,107,212 | (6,086,257) | |||||
Income before provision for income taxes | 16,656,542 | 27,953,786 | |||||
Provision for current income taxes | 5,039,240 | 7,910,373 | |||||
Recovery of deferred taxes | (137,395) | (167,358) | |||||
Provision for income taxes | 4,901,845 | 7,743,015 | |||||
NET INCOME | $ | 11,754,697 | $ | 20,210,771 | |||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | |||||||
Basic | 35,127,877 | 34,954,909 | |||||
Diluted | 35,127,877 | 36,548,485 | |||||
EARNINGS PER SHARE | |||||||
Basic | $ | 0.33 | $ | 0.58 | |||
Diluted | $ | 0.33 | $ | 0.57 | |||
The accompanying notes are an integral part of these consolidated financial statements. | |||||||
CHINA HOUSING & LAND DEVELOPMENT, INC., AND SUBSIDIARIES
For The Years Ended December 31, 2013 and 2012 | ||||||
2013 | 2012 | |||||
NET INCOME | $ | 11,754,697 | $ | 20,210,771 | ||
OTHER COMPREHENSIVE INCOME | ||||||
Foreign currency translation adjustment | 6,546,790 | 1,471,275 | ||||
COMPREHENSIVE INCOME | $ | 18,301,487 | $ | 21,682,046 | ||
The accompanying notes are an integral part of these consolidated financial statements. | ||||||
CHINA HOUSING & LAND DEVELOPMENT INC., AND SUBSIDIARIES For The Years Ended December 31, 2013 and 2012 | |||||||
December 31, | December 31, | ||||||
2013 | 2012 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
Net income | $ | 11,754,697 | $ | 20,210,771 | |||
Adjustments to reconcile net income to cash provided by | |||||||
Bad debt recovery | (164) | - | |||||
Depreciation | 2,598,326 | 2,065,380 | |||||
Stock-based compensation | 1,375,857 | 1,010,875 | |||||
Loss(gain) on disposal of property and equipment | 1,107,212 | (6,086,257) | |||||
Amortization of deferred financing costs | - | 156,064 | |||||
Amortization of intangible assets | 13,498,819 | 218,480 | |||||
Recovery of deferred taxes | (137,395) | (167,358) | |||||
Change in fair value of embedded derivatives | - | (330,628) | |||||
Change in fair value of warrants | - | (4,162) | |||||
Accretion expense on convertible debt | - | 954,979 | |||||
Accretion expense on mandatorily redeemable | - | (1,542,039) | |||||
(Increase) decrease in assets: | |||||||
Accounts receivable | (13,637,800) | 619,790 | |||||
Construction in excess of billing | (574,056) | (1,481,534) | |||||
Other receivables, prepaid expenses and other assets, net | (468,501) | (5,061,576) | |||||
Real estate held for development or sale | (70,989,071) | (76,702,170) | |||||
Advances to suppliers | 693,807 | (454,840) | |||||
(Deposit) refund on land use rights | (15,071,133) | 22,754,848 | |||||
Increase (decrease) in liabilities: | |||||||
Accounts payable | 2,834,646 | 10,349,314 | |||||
Advances from customers | (5,243,032) | (9,459,510) | |||||
Accrued expenses | (5,274,375) | 22,144,899 | |||||
Other payables | 1,185,307 | 3,665,900 | |||||
Income and other taxes payable | 7,572,979 | 7,289,569 | |||||
Net cash used in operating activities | (68,773,877) | (9,849,205) | |||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
Purchase of property and equipment | (5,793,142) | (10,723,887) | |||||
Proceeds from sale of property and equipment | 654,321 | 5,480,530 | |||||
Net cash used in investing activities | (5,138,821) | (5,243,357) | |||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
Change in restricted cash | (3,694,203) | (4,001,058) | |||||
Loans from banks | 98,841,999 | 99,673,042 | |||||
Loans from Days Hotel, Shanghai Xinying Fund LLC, | 46,269,017 | 51,538,584 | |||||
Repayments on loans payable | (49,173,393) | (123,698,502) | |||||
Loans from employees | (2,902,615) | 12,730,011 | |||||
Repayment for mandatorily redeemable non-controlling | - | (27,112,369) | |||||
Repayment of convertible debt | - | (9,645,570) | |||||
Purchase of treasury stock | (1,966,047) | (14,142) | |||||
Net cash provided by (used in) financing activities | 87,374,758 | (530,004) | |||||
INCREASE (DECREASE) IN CASH | 13,462,060 | (15,622,566) | |||||
Effects on foreign currency exchange | 1,736,563 | (270,939) | |||||
Cash, beginning of year | 6,121,448 | 22,014,953 | |||||
Cash, end of year | $ | 21,320,071 | $ | 6,121,448 | |||
The accompanying notes are an integral part of these consolidated financial statements. | |||||||
