Teleconference to be Held on November 16, 2010 at 8:00 a.m. EST
BEIJING, Nov. 15, 2010 /PRNewswire-Asia/ -- 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 third quarter and first nine months of 2010.
Highlights
Mr. Xiaoan He, Chairman and CEO of Fuwei Films, said, "We are very pleased with our third quarter and nine months financial results. The demand for BOPET films in domestic and foreign markets has continued to increase, especially in the foreign markets. In the third quarter we also saw the demand in the domestic market continued to expand which resulted in the significant increase of sales prices especially in the commodity films area. In spite of rising competition, we saw significant revenue growth this quarter and our gross profit was significantly higher than the previous year."
Third Quarter of 2010 Results
Net sales during the third quarter ended September 30, 2010 were RMB 129.2 million (US$19.3 million), compared to RMB 89.6 million (US$13.1 million), during the same period in 2009, representing a 44.2% increase.
The sales of specialty films during the third quarter ended September 30, 2010 were RMB28.5 million (US$4.3 million), reflecting 22.1% of total net sales as compared to 12.4% in the same period of 2009. The increase was largely attributable to the increase in demand for packaging for luxury goods.
The following is a breakdown of commodity and specialty film sales for the three-month periods ended September 30, 2010 and 2009 (amounts in thousands):
Three-Month Period Ended |
% of Total |
Three-Month Period Ended |
% of Total |
|||||
RMB |
US$ |
RMB |
||||||
Printing film |
|
18,842 |
2,813 |
14.6% |
|
10,292 |
11.5% |
|
Stamping film |
67,636 |
10,098 |
52.4% |
53,441 |
59.6% |
|||
Metallization film |
|
8,799 |
1,314 |
6.8% |
|
8,105 |
9.0% |
|
Specialty film |
28,489 |
4,253 |
22.1% |
11,149 |
12.4% |
|||
Base film for other application |
|
5,408 |
807 |
4.2% |
|
6,616 |
7.4% |
|
|
|
129,174 |
19,285 |
100.0% |
|
89,603 |
100.0% |
|
Overseas sales during the third quarter ended September 30, 2010 were RMB30.9 million (US$4.6 million), which accounted for 23.9% of our total net revenues, as compared with RMB 6.0 million (US$0.9 million) and 6.7% in the same period in 2009, which is 411.8% higher than the same period last year. The increase in overseas sales was mainly due to the recovery of overseas demand, especially the increase of demand in Europe, North America, Korea, Japan and Southeast Asia.
The following is a breakdown of domestic and overseas sales for the three-month periods ended September 30, 2010 and 2009 (amounts in thousands):
Three-Month Period Ended |
% of Total |
Three-Month Period Ended |
% of Total |
||||
RMB |
US$ |
RMB |
|||||
Sales in China |
|
98,264 |
14,670 |
76.1% |
83,564 |
93.3% |
|
Sales in other countries |
30,910 |
4,615 |
23.9% |
6,039 |
6.7% |
||
|
|
||||||
129,174 |
19,285 |
100.0% |
89,603 |
100.0% |
|||
Gross profit was RMB40.5 million (US$6.0 million) for the third quarter ended September 30, 2010, representing a gross margin of 31.4%, as compared to a gross margin of 8.8% from the same period in 2009. This was mainly due to a significant increase in the average sales price of our products during the third quarter compared with the same period in 2009.
Operating expenses for the third quarter ended September 30, 2010 were RMB 22.4 million (US$3.3 million), which was RMB 15.3 million (US$2.3 million) or 218.0% higher than the same period in 2009. This increase was mainly due to increased delivery costs of overseas sales, allowances for doubtful account receivables and other receivables.
Net income during the third quarter ended September 30, 2010 was RMB 15.0 million (US$2.2 million) compared to net income of RMB2.0 million (US$0.3 million) during the same period in 2009, representing an increase in net income of RMB 13.0 million(US$1.9 million)from the same period in 2009. The increase was mainly due to the increase of revenue and gross margin.
Net cash flows provided by operating activities for the nine months ended September 30, 2010 was RMB 67.8 million (US$ 10.2 million) compared to net cash flows provided by operating activities of RMB10.7 (US$1.6 million) for the nine months ended September 30, 2009, which is an increase of RMB 57.0 million (US$8.5 million). This increase in cash flows from operating activities was attributable primarily to the increased earnings, decrease of accounts receivables and inventories, and increase of advance payments.
Total shareholders' equity was RMB526.9 million (US$78.7 million) as of September 30, 2010, compared with RMB 511.6 million as of December 31, 2009.
As of September 30, 2010, the Company had 13,062,500 basic and diluted total ordinary shares outstanding.
Conference Call Information
The Company will host a teleconference on Tuesday, November 16, 2010, at 8:00 a.m. EDT / 9:00 p.m. Beijing time to discuss the quarterly 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 access codes: Account#: 286 and Conference ID: 360959. The replay will be available until December 16, 2010, 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 Films' 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 is 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. Maggie Huang |
|
Investor Relations Manager |
|
Phone: +86-10-6852-2612 |
|
Email: fuweiIR@fuweifilms.com |
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In the U.S.: |
|
Ms. Leslie Wolf-Creutzfeldt |
|
Investor Relations |
|
Grayling |
|
Phone: +1-646-284-9472 |
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FUWEI FILMS (HOLDINGS) CO., LTD. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS AS OF SEPTEMBER 30, 2010 AND DECEMBER 31, 2009 (amounts in thousands except share and per share value) |
||||||
September 30, |
December 31, |
|||||
(Unaudited) |
||||||
ASSETS |
RMB |
US$ |
RMB |
|||
Current assets |
||||||
Cash and cash equivalents |
93,362 |
13,939 |
26,804 |
|||
Restricted cash |
8,583 |
1,281 |
12,541 |
|||
Accounts and bills receivable, net |
42,659 |
6,369 |
28,785 |
|||
Inventories |
32,028 |
4,782 |
45,039 |
|||
Advance to suppliers |
16,191 |
2,417 |
3,956 |
|||
Prepayments and other receivables |
1,759 |
263 |
957 |
|||
Deferred tax assets - current |
2,569 |
384 |
1,198 |
|||
Total current assets |
197,152 |
29,435 |
119,282 |
|||
Plant, properties and equipment, net |
294,372 |
43,949 |
318,600 |
|||
Construction in progress |
235,955 |
35,227 |
237,118 |
|||
Lease prepayments, net |
21,155 |
3,158 |
21,548 |
|||
Advanced to suppliers - Long Term |
- |
- |
2,367 |
|||
Goodwill |
10,276 |
1,534 |
10,276 |
|||
Deposit |
16,760 |
2,502 |
21,000 |
|||
Deferred tax assets - non current |
1,963 |
293 |
5,318 |
|||
Total assets |
777,633 |
116,098 |
735,509 |
|||
LIABILITIES AND SHAREHOLDERS' EQUITY |
||||||
Current liabilities |
||||||
Short-term borrowings |
137,000 |
20,454 |
153,179 |
|||
Accounts payables |
22,229 |
3,319 |
25,898 |
|||
Advance from customers |
42,251 |
6,308 |
12,608 |
|||
Accrued expenses and other payables |
14,056 |
2,098 |
6,981 |
|||
215,536 |
32,179 |
198,666 |
||||
Long-term loan |
35,000 |
5,225 |
25,000 |
|||
Total liabilities |
250,536 |
37,404 |
223,666 |
|||
Commitments and contingencies |
||||||
Equity |
||||||
Shareholders' equity |
||||||
Registered capital(of US$0.129752 par value; 20,000,000 shares authorized; 13,062,500 issued and outstanding) |
13,322 |
1,989 |
13,323 |
|||
Additional paid-in capital |
311,896 |
46,565 |
311,907 |
|||
Statutory reserve |
29,338 |
4,380 |
29,338 |
|||
Retained earnings |
171,251 |
25,567 |
156,006 |
|||
Cumulative translation adjustment |
1,109 |
166 |
993 |
|||
Total shareholders' equity |
526,916 |
78,667 |
511,567 |
|||
Non-controlling interest |
182 |
27 |
276 |
|||
Total equity |
527,098 |
78,694 |
511,843 |
|||
Total liabilities and equity |
777,633 |
116,098 |
735,509 |
|||
FUWEI FILMS (HOLDINGS) CO., LTD. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OTHER FOR THE THREE AND NINE-MONTH PERIODS ENDED SEPTEMBER 30, 2010 AND 2009 (amounts in thousands except share and per share value) (UNAUDITED) |
|||||||||||
The Three Months |
The Nine Months |
||||||||||
Period Ended |
Period |
Period Ended |
Period |
||||||||
RMB |
US$ |
RMB |
RMB |
US$ |
RMB |
||||||
Net sales |
|
129,174 |
19,285 |
|
89,603 |
|
327,948 |
48,961 |
|
236,691 |
|
Cost of sales |
(88,658) |
(13,236) |
(81,749) |
(254,996) |
(38,070) |
(220,490) |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
40,515 |
6,049 |
7,854 |
72,952 |
10,891 |
14,201 |
|||||
|
|
||||||||||
Operating expenses |
|||||||||||
Selling expenses |
|
(4,389) |
(655) |
|
(2,868) |
|
(11,944) |
(1,783) |
|
(10,499) |
|
Administrative expenses |
(17,992) |
(2,686) |
(4,170) |
(38,417) |
(5,736) |
(20,241) |
|||||
Total operating expenses |
|
(22,381) |
(3,341) |
|
(7,038) |
|
(50,361) |
(7,519 |
|
(30,740) |
|
Operating income/(loss) |
|
18,143 |
2,707 |
|
816 |
|
22,591 |
3,373 |
|
(16,539) |
|
Other income/(expense) |
|
|
|
|
|
|
|
|
|
|
|
- Interest income |
42 |
6 |
5 |
214 |
32 |
148 |
|||||
- Interest expense |
|
(2,337) |
(349) |
|
(2,091) |
|
(6,624) |
(989) |
|
(6,210) |
|
- Others income, net |
(245) |
(37) |
3,547 |
(381) |
(57) |
(335) |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
Total other income/(expense) |
(2,540) |
(379) |
1,461 |
(6,791) |
(1,014) |
(6,398) |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
Income before income tax benefit/(expense) |
15,594 |
2,328 |
2,277 |
15,800 |
2,359 |
(22,937) |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
Income tax benefit/(expense) |
(578) |
(86) |
(264) |
(555) |
(83) |
3,440 |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
Net Income/(loss) |
15,017 |
2,242 |
2,013 |
15,245 |
2,276 |
(19,497) |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
Net income/(loss) attributable to noncontrolling interests |
(26) |
(4) |
(5) |
(95) |
(14) |
(5) |
|||||
Net income/(loss) attributable to the Company |
|
15,043 |
2,246 |
|
2,018 |
15,340 |
2,290 |
|
(19,492) |
||
Other comprehensive income |
|
|
|
|
|
|
|
|
|
||
- Foreign currency translation adjustments |
132 |
19 |
2 |
116 |
17 |
614 |
|||||
Comprehensive income |
15,174 |
2,265 |
2,020 |
15,456 |
2,307 |
(18,877) |
|||||
|
|
||||||||||
Earnings per share, basic and diluted |
1.15 |
0.17 |
0.15 |
1.17 |
0.18 |
(1.49) |
|||||
Weighted average number ordinary shares, |
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 NINE-MONTH PERIODS ENDED SEPTEMBER 30, 2010 AND 2009 (amounts in thousands except share and per share value) (UNAUDITED) |
||||||
|
|
Periods Ended September 30, 2010 |
|
Periods Ended September 30, 2009 |
||
RMB |
US$ |
RMB |
||||
Cash flow from operating activities |
|
|
|
|
|
|
Net income |
15,245 |
2,276 |
(19,492) |
|||
Adjustments to reconcile net income to net cash |
|
|
|
|
|
|
(used in)/provided by operating activities |
||||||
- Depreciation of property, plant and equipment |
|
26,763 |
3,996 |
|
25,732 |
|
- Amortization of intangible assets |
340 |
51 |
340 |
|||
- Deferred income taxes |
|
1,942 |
290 |
|
- |
|
- Bad debt expense/(recovery) |
9,138 |
1,364 |
3,767 |
|||
- Accounts receivable |
|
(15,138) |
(2,260) |
|
11,751 |
|
- Inventories |
13,011 |
1,942 |
(9,922) |
|||
- Advance to suppliers |
|
(16,236) |
(2,424) |
|
(1,070) |
|
- Prepaid expenses and other current assets |
(487) |
(73) |
(6,437) |
|||
- Accounts payable |
|
(3,656) |
(546) |
|
5,707 |
|
- Accrued expenses and other payables |
7,236 |
1,080 |
(1,352) |
|||
- Advance from customers |
|
29,643 |
4,426 |
|
7,791 |
|
- Tax payable |
|
(38) |
(6) |
|
(6,101) |
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
67,762 |
10,117 |
10,716 |
|||
|
|
|
|
|
|
|
Cash flow from investing activities |
||||||
Purchases of property, plant and equipment |
|
(2,482) |
(371) |
|
(93,091) |
|
Restricted cash related to trade finance |
3,952 |
590 |
(400) |
|||
Advanced to suppliers - non current |
|
2,367 |
353 |
|
- |
|
Addition to construction in progress |
1,163 |
174 |
|
83,469 |
||
Net cash used in investing activities |
|
5,000 |
747 |
|
(10,023) |
|
Cash flow from financing activities |
|
|
|
|
|
|
Principal payments of short-term bank loans |
(16,179) |
(2,415) |
(11,585) |
|||
Proceeds from short-term bank loans |
|
10,000 |
1,493 |
|
10,000 |
|
Net cash (used in)/provided by financing activities |
|
(6,179) |
(923) |
|
(1,585) |
|
Effect of foreign exchange rate changes |
|
(26) |
72 |
|
892 |
|
Net increase (decrease) in cash and cash equivalent |
|
66,557 |
10,013 |
|
(1) |
|
Cash and cash equivalent |
|
|
|
|
|
|
At beginning of period/year |
|
26,804 |
3,926 |
|
15,823 |
|
At end of period/year |
|
93,362 |
13,939 |
|
15,822 |
|
SUPPLEMENTARY DISCLOSURE: |
|
|
|
|
|
|
Interest paid |
6,624 |
989 |
5,991 |
|||
Income tax paid |
|
3,966 |
592 |
|
- |
|