omniture

Sino Assurance Inc. (OTC: SNAS). Reports Second Quarter 2011 Revenue and Earnings Growth

2011-08-10 20:02 1276

SHENZHEN, China, August 10, 2011 /PRNewswire-Asia-FirstCall/ -- Sino Assurance Inc. (OTCBB: SNAS) today reported solid second quarter 2011 financial result highlighted by earnings growth, an increase of 30% in net revenue and 86% gross margin.

Net revenue

Net revenue for the six months ended June 30, 2011, was $5,589,853 as compared to $4,309,302 for the same period in 2010. The increase of $1,280,551 or approximately 30% was due to significant year-over-year growth of our customer base in the tender and surety guarantee business and market share in China. The gross margin increased to 86% from 82% for the six months ended June 30, 2011, due to tightening of control of our cost of sales. As a result, the cost of sales decreased for the period and the percentage of the guarantee fee income substantially increased.

Net revenue for the three months ended June 30, 2011, was $2,092,938 as compared to $2,415,032 for the same period in 2010. The decrease of $322,094 or approximately 13% was due to the tightening control of bank loan supply in China during this period and as a result reduce the demand of tender and surety guarantee business. The gross margin decreased to 78% from 83% for the three months ended June 30, 2011, due to the percentage of the guarantee fee income that without cost was decreased and the percentage of guarantee fee income that with cost was increased.

Net income before tax

Net income before tax for the six months ended June 30, 2011 was $2,732,175 compared to $2,000,122 for the same period in 2010, an increase in pre-tax income of $732,053, or approximately 37%. The increase in pre-tax net income was a result of the fact that we tightened control of our selling, general and administrative expenses during the period, and also employed more agents to promote our guarantee business which resulted in an increase in guarantee fee income from bank referrals.

Net income before tax for the three months ended June 30, 2011 was $574,528 compared to $1,234,181 for the same period in 2010, a decrease in pre-tax income of $659,653, or approximately 53%. The decrease in pre-tax net income was due the decrease in net revenue and gross margin during this period, as well as the increase in selling, general and administrative expenses.

Operating expenses

Total operating expenses were $2,057,022 for the six months ended June 30, 2011, as compared to $1,541,376 for the same period in 2010. The increase of $515,646 or 33% was primarily due to the increase in staff costs, provision for guarantee losses, rent and rate, audit fee and other professional fee.

Total operating expenses were $1,055,025 for the three months ended June 30, 2011, as compared to $758,948 for the same period in 2010. The increase of $296,077 or 39% was primarily due to the increase in staff costs, provision for guarantee losses, rent and rate, audit fee and other professional fee.

LIQUIDITY

For the six months ended June 30, 2011, cash provided by operating activities totaled $2,510,752. This was primarily due to the net income for the period plus increase in deferred revenue, partially offset by the increase in guarantee fee receivables, prepayments and other receivable and decrease in income tax payable, accounts payable and accrued liability and other payable.

For the six months ended June 30, 2011, cash used in investing activities amounted to $2,045,666. The use of funds was mainly due to the payment on loan receivable and purchase of plant and equipment, partially offset by the receipts from loans receivable and the change in restricted cash, net of customer collateral.

Safe Harbor Statement

This press release may include certain statements that are not descriptions of historical facts, but are forward-looking statements. Forward-looking statements can be identified by the use of forward-looking terminology such as 'will,' 'believes,' 'expects' or similar expressions. Such information is based upon expectations of our management that were reasonable when made but may prove to be incorrect. All of such assumptions are inherently subject to uncertainties and contingencies beyond our control and based upon premises with respect to future business decisions, which are subject to change. We do not undertake to update the forward-looking statements contained in this press release. For a description of the risks and uncertainties that may cause actual results to differ from the forward-looking statements contained in this press release, see our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission ('SEC'), and our subsequent SEC filings. Copies of filings made with the SEC are available through the SEC's electronic data gathering analysis retrieval system at http://www.sec.gov.

For more information, please contact:



Company Contact:

Wei Wei, Assistant to CFO

Sino Assurance,Inc.

Tel: +86-755- 82523518

Email: wei_wei@snas.cc


Investor Contact:

Eric Tong, Chief Finance Officer

Tel: +86-755- 82525568

Email: tongmengyou@gmail.com



SINO ASSURANCE INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2011 AND DECEMBER 31, 2010

(Currency expressed in United States Dollars ("US$"), except for number of shares)



June 30, 2011


December 31, 2010


(Unaudited)


(Audited)

ASSETS






Current assets:






Cash and cash equivalents

$

7,707,458


$

7,074,893

Restricted cash


17,266,064



13,050,117

Guarantee fee receivable


30,524



18,003

Loans receivable, unsecured


5,368,291



2,842,001

Prepayments and other receivable


668,752



262,127


Total current assets


31,041,089



23,247,141







Non-current assets:






Plant and equipment, net


519,675



410,807


TOTAL ASSETS

$

31,560,764


$

23,657,948







LIABILITIES AND STOCKHOLDERS' EQUITY






Current liabilities:






Accounts payable, trade

$

104,677


$

130,209

Customer collateral


13,498,202



8,830,517

Deferred revenue


1,384,887



915,847

Amount due to a related party


63,022



61,614

Income tax payable


-



529,447

Deferred tax liabilities


2,130,617



1,422,843

Accrued liabilities and other payable


1,738,930



1,455,009


Total current liabilities


18,920,335



13,345,486







Commitments and contingencies












Stockholders' equity:






Common stock, $0.001 par value; 200,000,000 shares authorized;
60,200,000 shares issued and outstanding, respectively


60,200



60,200

Additional paid-in capital


2,970,045



2,970,045

Accumulated other comprehensive income


731,189



468,837

Statutory reserve


332,153



332,153

Retained earnings


8,546,842



6,481,227


Total stockholders' equity


12,640,429



10,312,462


TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

31,560,764


$

23,657,948



SINO ASSURANCE INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2011 AND 2010

(Currency expressed in United States Dollars ("US$")

(Unaudited)



Three months ended June 30,


Six months ended June 30,


2011


2010


2011


2010

REVENUES, NET












Guarantee fee income

$

2,065,213


$

2,376,826


$

5,531,583


$

4,248,505

Interest income


27,725



38,206



58,270



60,797













Total revenues, net


2,092,938



2,415,032



5,589,853



4,309,302













COST OF REVENUE


463,385



421,903



800,656



767,804













GROSS PROFIT


1,629,553



1,993,129



4,789,197



3,541,498













Operating expenses:












Selling, general and administrative


925,185



629,406



1,736,948



1,304,180

Provision for guarantee losses


129,840



129,542



320,074



237,196


Total operating expenses


1,055,025



758,948



2,057,022



1,541,376













INCOME BEFORE INCOME TAXES


574,528



1,234,181



2,732,175



2,000,122













Income tax expense


(145,801)



(289,924)



(666,560)



(470,963)













NET INCOME

$

428,727


$

944,257


$

2,065,615


$

1,529,159













Other comprehensive income:












- Foreign currency translation gain


192,185



26,106



262,352



26,901













COMPREHENSIVE INCOME

$

620,912


$

970,363


$

2,327,967


$

1,556,060













Net income per share - Basic and diluted

$

0.01


$

0.02


$

0.03


$

0.03













Weighted average common shares outstanding - Basic and diluted


60,200,000



60,000,000



60,200,000



60,000,000




SINO ASSURANCE INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2011 AND 2010

(Currency expressed in United States Dollars ("US$")

(Unaudited)




Six months ended June 30,



2011


2010

Cash flows from operating activities:







Net income


$

2,065,615


$

1,529,159

Adjustments to reconcile net income to net cash provided by
operating activities:







Depreciation



72,434



55,539

Loss on disposal of plant and equipment



1,356



556

Provision for guarantee losses



320,074



237,196

Deferred tax expense



666,560



294,631

Changes in operating assets and liabilities:







Guarantee fee receivable



(11,954)



(14,611)

Prepayments and other receivable



(395,481)



(130,121)

Accounts payable, trade



(28,143)



8,296

Deferred revenue



442,339



187,932

Income tax payable



(534,591)



142,356

Accrued liabilities and other payable



(87,457)



(76,186)








Net cash provided by operating activities



2,510,752



2,234,747








Cash flows from investing activities:







Change in restricted cash, net of customer collateral



541,172



(275,293)

Receipts from loans receivable



16,510,824



1,477,745

Payment on loans receivable



(18,940,490)



(2,831,125)

Proceeds from disposal of plant and equipment



153



44

Purchase of plant and equipment



(157,325)



(128,135)








Net cash used in investing activities



(2,045,666)



(1,756,764)








Effect of exchange rate changes in cash and cash equivalents


167,479



4,187








NET CHANGE IN CASH AND CASH EQUIVALENTS


632,565



482,170








CASH AND CASH EQUIVALENT, BEGINNING OF PERIOD



7,074,893



559,105








CASH AND CASH EQUIVALENT, END OF PERIOD


$

7,707,458


$

1,041,275








SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:




Cash paid for income taxes


$

534,591


$

32,281

Cash paid for interest


$

-


$

-




Source: Sino Assurance, Inc.
Related Stocks:
OTC:SNAS
collection