omniture

IT Tech Packaging, Inc. Announces Fourth Quarter and Fiscal Year 2018 Financial Results

Company to Host Earnings Conference Call on Friday, March 8, 2019, at 8:00 am ET
2019-03-08 08:50 8657

BAODING, China, March 8, 2019 /PRNewswire/ -- IT Tech Packaging, Inc. (NYSE MKT: ITP) ("IT Tech Packaging" or the "Company"), a leading manufacturer and distributor of diversified paper products in North China, today announced its unaudited financial results for the fourth quarter and audited financial results for the fiscal year ended December 31, 2018.










 For the Three Months Ended December 31,

 ($ millions)


2018


2017


 % Change

 Revenues


24.99


35.44


-29.5%

 Regular Corrugating Medium Paper ("CMP")*


19.77


24.64


-19.8%

 Light-Weight CMP**


5.30


5.15


2.8%

 Offset Printing Paper


0.00


5.38


-100.0%

 Tissue Paper Products


0.00


0.27


-100.0%

 Digital Photo Paper


0.00


0.00


NM








 Gross profit


2.24


3.62


-38.0%

 Gross profit (loss) margin


9.0%


10.2%


-1.2 pp

 Regular Corrugating Medium Paper ("CMP")*


1 0.0%


8.9%


1.1 pp

 Light-Weight CMP**


4.9%


10.0%


-5.1 pp

 Offset Printing Paper


NM


16.5%


-16.5 pp

 Tissue Paper Products


NA


5.8%


NM

 Digital Photo Paper


NA


NA


NM








 Operating income (loss)


-5.08


-1.67


-203.4%

 Net income (loss)


-5.16


-1.64


-215.6%

 EBITDA


-1.66


2.04


-181.7%

 Basic and Diluted earnings (loss) per share


-0.24


-0.08


-213.5%








 * Products from PM6







 ** Products from PM1







 *** pp represents percentage points







 

  • Revenue for the fourth quarter of 2018 decreased by 29.5% to $25 million, primarily due to the decrease in both sales volume and ASP of Regular CMP and no sales recorded for offset printing paper.
  • Gross profit for the fourth quarter of 2018 decreased by 38% to $2.2 million. Gross margin decreased by 1.2 percentage points to 9.0%. The gross margins for Light-Weight CMP and Offset Printing Paper products continued to decrease.
  • Net loss was $5.2 million, or loss per share of $0.24, compared to net loss of $1.6 million, or loss per share of $0.08, for the same period of the prior year.
  • Earnings before interest, taxes, depreciation and amortization ("EBITDA") decreased by 181.7% to $(1.7) million.

Mr. Zhenyong Liu, Chairman and Chief Executive Officer of the Company, commented, "With decreases in both revenues and margins, our fourth quarter results highlighted continued challenges facing our business. In late January 2018, we temporarily suspended production due to government-mandated restrictions on natural gas supply. Though we resumed production in mid-March, the Company incurred a net loss of $4 million in the first quarter of 2018. In the second half of 2018, we completed construction of one of our business expansion projects, our first tissue paper production line, in Wei County Industrial Park, launching it in December 2018. As production in this line increases over the coming months, and with our existing packaging equipment, we expect to see continuous cash flow and improved financial conditions from 2019 sales. Looking ahead, as China's paper market continues to grow, government environmental protection heightens, and market completion escalates, we will be focusing on actively diversifying our product portfolio, opportunities for equipment upgrades, reducing raw material costs, and leveraging new technologies."

Fourth Quarter 2018 Financial Results

Revenue

For the fourth quarter of 2018, total revenue decreased by $10.45 million, or 29.5%, to $24.99 million from $35.44 million for the same period of the prior year. The decrease in total revenue was mainly due to the decrease in both sales volume and ASP of Regular CMP and no sales recorded for offset printing paper. The following table summarizes revenue, volume and ASP by product for the fourth quarter of 2018 and 2017, respectively:


For the Three Months Ended December 31,


2018


2017


Revenue
($'000)


Volume
(tonne)


ASP
($/tonne)


Revenue
($'000)


Volume
(tonne)


ASP
($/tonne)

Regular CMP

19,765


41,870


472


24,638


44,411


555

Light-Weight CMP

5,296


11,532


459


5,151


9,294


554

Offset Printing Paper

-


-


-


5,381


6,512


826

Tissue Paper Products

-


-


-


269


186


1,448

Digital Photo Paper

-


-


-


-


-


-

Total

25,061


53,402


469


35,439


60,403


587

Revenue from CMP, including both regular CMP and Light-Weight CMP, decreased by $4.73 million, or 15.9%, to $25.06 million and accounted for 100 % of total revenue for the fourth quarter of 2018, compared to $29.79 million, or 84.1% of total revenue, for the same period of the prior year. The Company sold 53,402 tonnes of CMP at an ASP of $469/tonne in the fourth quarter of 2018, compared to 53,705 tonnes at an ASP of $555/tonne in the same period of the prior year.

Of the total CMP sales, revenue from regular CMP decreased by $4.87 million, or 19.8%, to $19.77 million, resulting from sales of 41,871 tonnes at an ASP of $472/tonne, during the fourth quarter of 2018, compared to revenue of $24.64 million, resulting from sales of 44,411 tonnes at an ASP of $555/tonne, for the same period of the prior year. Revenue from light-weight CMP increased by $0.15 million, or 2.8%, to $5.30 million, resulting from sales of 11,533 tonnes at an ASP of $459/tonne for the fourth quarter of 2018, compared to revenue of $5.15 million, resulting from sales of 9,294 tonnes at an ASP of $554/tonne for the same period of the prior year.

Revenue from offset printing paper decreased by $5.46 million, or 100%, to $0 million for the fourth quarter of 2018, from $5.38 million for the same period of the prior year. The Company sold 0 tonnes of offset printing paper in the fourth quarter of 2018, compared to 6,512 tonnes at an ASP of $826/tonne in the same period of the prior year.

We had no revenue from tissue paper products for the fourth quarter of 2018, compared to $0.27 million, resulting from sales of 185 tonnes at an ASP of $1,456/tonne, for the fourth quarter of 2017.

We process base tissue paper purchased from a long-term supplier and produce finished tissue paper products, including toilet paper, boxed and soft-packed tissues, handkerchief tissues and paper napkins, as well as bathroom and kitchen paper towels that are marketed and sold under the Dongfang Paper brand. In December 2018, we completed the construction and installation and test of operation of PM8 and announced the commercial launch of tissue paper production. We expect to commence the full operation of production and sales of tissue paper products in year 2019.

In June 2016, we suspended the production of digital photo paper due to low market demand for our products and now are considering renovating the line to produce more competitive products. We expect that our digital photo paper production will remain suspended for the near future.

Gross Profit and Gross Margin

Total cost of sales decreased by $9.08 million, or 28.5%, to $22.7 million for the fourth quarter of 2018, from $31.82 million for the same period of the prior year. Cost of sales per tonne was $426 for the fourth quarter of 2018, compared to $527 for the same period of the prior year. The decrease in overall cost of sales per tonne was mainly attributable to the decrease in the quantities of regular CMP sold, partially offset by the increase in cost of recycled paper board and increase in sales volume of light-weighted CMP in the fourth quarter of 2018. Costs of sales per tonne for regular CMP and light-weight CMP were, $425 and $437, respectively, for the fourth quarter of 2018, compared to $505 and $499, respectively, for the same period of the prior year.

Total gross profit decreased by $1.38 million, or 38%, to $2.24 million for the fourth quarter of 2018, from $3.6 million for the same period of the prior year. The decrease in overall gross profit were mainly due to the decrease in overall sales volume and decrease in average selling prices of regular CMP and light-weight CMP as discussed above. Overall gross margin was 9% for the fourth quarter of 2018, compared to 10.2% for the same period of the prior year. Gross margins for regular CMP, light-weight CMP were 10% and 4.9%,  respectively, for the fourth quarter of 2018, compared to 8.9% and 10%, respectively, for the same period of the prior year.

Selling, General and Administrative Expenses

Selling, general and administrative expenses ("SG&A") increased by $0.44 million, or 14.7%, to $3.43 million for the fourth quarter of 2018 from $2.99 million for the same period of the prior year. As a percentage of total revenue, SG&A was 13.7% for the fourth quarter of 2018, compared to 8.4% for the same period of the prior year.

Income(loss) from Operations

Loss from operations was $5.08 million for the fourth quarter of 2018, compared to loss from operations of $1.67 million for the same period of the prior year. Operating loss margin was 20.3% for the fourth quarter of 2018, compared to operating loss margin of 4.7% for the same period of the prior year.

Net Income (loss)

Net loss was $5.16 million, or $0.24 per loss basic and diluted share, for the fourth quarter of 2018, compared to net loss of $1.64 million, or earnings per basic and diluted share of $0.08, for the same period of the prior year.

EBITDA

EBITDA decreased by $3.70 million, or 181.7%, to $(1.7) million for the fourth quarter of 2018 from $2.04 million for the same period of the prior year.

Note 1: Non-GAAP Financial Measures

In addition to our U.S. GAAP results, this press release includes a discussion of EBITDA, a non-GAAP financial measure as defined by the Securities and Exchange Commission ("SEC"). The Company defines EBITDA as net income before interest, income taxes, depreciation and amortization. EBITDA is a key measure used by management to evaluate our results and make strategic decisions. Management believes this measure is useful to investors because it is an indicator of operational performance. Because not all companies use identical calculations, the Company's presentation of EBITDA may not be comparable to similarly titled measures of other companies, and should not be viewed as an alternative to measures of financial performance or changes in cash flows calculated in accordance with the U.S. GAAP.

Reconciliation of Net Income to EBITDA

(Amounts expressed in US$)






 For the Three Months Ended December 31, 

 ($ millions) 


2018



2017

 Net income (loss) 


-5.16



-1.64

 Add: Income tax 


-0.22



-0.44

         Net interest expense 


0.31



0.41

         Depreciation and amortization 


3.42



3.71

 EBITDA 


-1.66



2.04

 

Full Year 2018 Financial Results  




 For the Twelve Months Ended December 31, 


 ($ millions) 


2018


2017


 % Change 


 Revenues 


86.75


117.02


-25.9%


 Regular Corrugating Medium Paper ("CMP")* 


63.20


80.38


-21.4%


 Light-Weight CMP** 


18.40


15.60


17.9%


 Offset Printing Paper 


5.14


18.69


-72.5%


 Tissue Paper Products 


0.00


2.36


-100.0%


 Digital Photo Paper 


0.01


0.00


NM










 Gross profit 


5.8


20.0


-70.8%


 Gross margin 


6.7%


17.1%


-10.3 pp


 Regular Corrugating Medium Paper ("CMP")* 


7.7%


16.9%


-9.3 pp


 Light-Weight CMP** 


5.0%


18.9%


-13.9 pp


 Offset Printing Paper 


0.8%


17.3%


-16.6 pp


 Tissue Paper Products 


N/A


6.4%


NM


 Digital Photo Paper 


N/A


0.0%


NM










 Operating income (loss) 


-11.2


4.7


-338.9%


 Net income (loss) 


-10.5


1.7


-735.4%


 EBITDA 


3.4


19.4


-82.5%


 Basic and Diluted earnings per share 


-0.49


0.08


-712.5%










 * Products from PM6 








 ** Products from PM1 








 *** pp represents percentage points 








Revenue

For the year ended December 31, 2018, total revenue decreased by $30.28 million, or 25.9%, to $86.75 million from $117.02 million for 2017. The decrease in total revenue was mainly due to the decrease in sales volume of Regular CMP and offset printing paper, which was partially offset by the increase in ASP of these products.

We decreased the production volume of regular CMP, light-Weight CMP and offset printing paper and sales of these products due to environmental conditions in Northern China. The government strengthened its pollution control and rectification measures, resulting in restrictions on production in the manufacturing industry. In addition, production of tissue paper was suspended during the year 2018. In December 2018, we completed the construction and installation and test of operation of PM8 and announced the commercial launch of tissue paper production. We expect to commence the full operation of production and sales of tissue paper products in year 2019. As a result, the production volume of regular CMP, light-Weight CMP and offset printing paper and sales of these products decreased in 2018 as compared to 2017. The following table summarizes revenue, volume and ASP by product for 2018 and 2017, respectively:


For the Twelve Months Ended December 31,


2018


2017


Revenue
($'000)


Volume
(tonne)


ASP
($/tonne)


Revenue
($'000)


Volume
(tonne)


ASP
($/tonne)

Regular CMP

63,199


116,012


545


80,379


173,399


464

Light-Weight CMP

18,397


34,646


531


15,600


33,690


463

Offset Printing Paper

5,137


6,191


830


18,688


26,610


702

Tissue Paper Products

-


-


-


2,357


1,804


1,306

Digital Photo Paper

14


-


 NM 


-


-


-

Total

86,747


156,849


553


117,024


235,503


497

Revenue from CMP, including both regular CMP and light-Weight CMP, decreased by $14.38 million, or 15%, to $81.60 million, and accounted for 94.1% of total revenue for 2018, compared to $95.98 million, or 82.0% of total revenue for 2017. The Company sold 150,658 tonnes of CMP at an ASP of $542/tonne in 2018, compared to 207,089 tonnes at an ASP of $463/tonne in 2017.

Of the total CMP sales, revenue from regular CMP decreased by $17.18 million, or 21.4%, to $63.20 million, resulting from sales of 116,012 tonnes at an ASP of $545/tonne, for 2018, compared to revenue of $80.38 million, resulting from sales of 173,399 tonnes at an ASP of $464/tonne for 2017. Revenue from light-weight CMP increased by $2.80 million, or 17.9%, to $18.40 million, resulting from sales of 34,646 tonnes at an ASP of $531/tonne for 2018, compared to revenue of $15.60 million, resulting from sales of 33,690 tonnes at an ASP of $463/tonne for 2017.

Revenue from offset printing paper decreased by $13.55 million, or 72.5%, to $5.14 million for 2018, from $18.69 million for 2017. The Company sold 6,191 tonnes of offset printing paper at an ASP of $830/tonne in 2018, compared to 26,610 tonnes at an ASP of $702/tonne in 2017.

Revenue from tissue paper products decreased from $2.36 million for 2017, or 100%, to $0 million, for 2018. The Company sold 0 tonnes of tissue paper products, compared to 1,804 tonnes at an ASP of $1,306/tonne in 2017.

Revenue from digital photo paper were $13,622 for year 2018. In June 2016, we suspended the production of digital photo paper due to low market demand for our products and now are considering renovating the line to produce more competitive products. We expect that our digital photo paper production will remain suspended for the near future.

Gross Profit and Gross Margin

Total cost of sales decreased by $16.16 million, or 16.65%, to $80.93 million for 2018, from $97.07 million for 2017.  This was mainly a result of the decrease in volume sold, partially offset by increase in cost of recycled paper board and recycled white scrap paper. Cost of sales per tonne was $516 for 2018, compared to $412 for 2017. The increase in overall cost of sales per tonne was mainly attributable to the higher average unit purchase costs (net of applicable value added tax) of recycled paper board in 2018 as compared to 2017. Costs of sales per tonne for regular CMP, light-weight CMP, offset printing paper and tissue paper products, $503, $504, $823 and $nil, respectively, for 2018, compared to $385, $375, $581, $1,222, respectively, for 2017.

Total gross profit decreased by $14.14 million, or 70.8%, to $5.82 million for 2018, from $19.96 million for 2017. Overall gross margin decreased by 10.3 percentage points to 6.7% for 2018 from 17.1% for 2017. Gross margin for regular CMP, light-weight CMP, offset printing paper and tissue paper, was 7.7%, 5.0%, 0.8% and nil, respectively, for 2018, compared to 16.9%, 18.9%, 17.3% and 6.4%, respectively, for 2017. The decrease in gross profit and gross margin were mainly due to the increase in average unit purchase costs (net of applicable value added tax) of recycled paper board and recycled white scrap paper and decrease in overall sales volume, partially offset by an increase in average selling prices as discussed above.

Selling, General and Administrative Expenses

Selling, general and administrative expenses ("SG&A") increased by $1.79 million, or 15.8%, to $13.10 million for 2018, from $11.31 million for 2017. As a percentage of total revenue, SG&A was 15.1% for 2018, compared to 9.7% for 2017. The increase was mainly due to (i) compensation expenses resulting from the issuance of 534,500 shares of common stock under our compensatory incentive plans in the year ended December 31, 2018, valued at $470,360 and (ii) the depreciation of idle equipment during the suspension of production in the first quarter and third quarter of 2018.

Loss from Operations

Income from operations decreased by $15.86 million, or 338.9%, to operating loss of $11.18 million for 2018 from $4.68 million for 2017. Operating loss margin was 12.9% for 2018, compared to 4.0% for 2017.

Net Income (loss)

Net loss was $10.55 million, or $0.49 per loss basic and diluted share, for 2018, compared to net income of $1.66 million, or earnings per basic and diluted share of $0.08, for the same period of the prior year.

EBITDA

EBITDA decreased by $16.00 million, or 82.5%, to $ 3.39 million for 2018, from $19.39 million for 2017.

Note 2: Non-GAAP Financial Measures

In addition to our U.S. GAAP results, this press release includes a discussion of EBITDA, a non-GAAP financial measure as defined by the Securities and Exchange Commission ("SEC"). The Company defines EBITDA as net income before interest, income taxes, depreciation and amortization. EBITDA is a key measure used by management to evaluate our results and make strategic decisions. Management believes this measure is useful to investors because it is an indicator of operational performance. Because not all companies use identical calculations, the Company's presentation of EBITDA may not be comparable to similarly titled measures of other companies, and should not be viewed as an alternative to measures of financial performance or changes in cash flows calculated in accordance with the U.S. GAAP.

Reconciliation of Net Income to EBITDA

(Amounts expressed in US$)






 For the Twelve Months Ended December 31, 

 ($ millions) 


2018



2017

 Net income (loss) 


-10.55



1.66

 Add: Income tax 


-1.85



0.66

         Net interest expense 


1.49



2.43

         Depreciation and amortization 


14.29



14.63

 EBITDA 


3.39



19.39

Cash, Liquidity and Financial Position

Our cash, cash equivalents and restricted cash as of December 31, 2018 was $12.12 million, an increase of $3.1 million, from $9.02 million as of December 31, 2017. Net cash provided by operating activities was $9.79 million for 2018, compared to $18.15 million for 2017. Net cash used in investing activities was $2.2 million for 2018, compared to $9.32 million for 2017. Net cash used by financing activities was $3.17 million for 2018, compared to $4.92 million for 2017.

As of December 31, 2018, we had a net working capital deficit of $5.48 million, an increase of $3.7 million, from the net working capital deficit of $1.77 million at December 31, 2017. Substantially all cash and cash equivalents are cash deposits in bank accounts. Restricted cash of $3.64 million is deposited at the Bank of Cangzhou for purpose of securing the bank acceptance notes from the bank. The acceptance notes was paid off in January 2019.                                               

Recent Development

In December 2018, the Company commercially launched its tissue paper production, following the completion of construction and equipment installation, the receipt of proper approvals, including wastewater discharge permit, from local authorities, and the success of trial production of its first tissue paper production line, the PM8 Production Line which is located at Wei County Industrial Park in Hebei Province, China, with annual production capacity of 15,000 tonnes.

Earnings Conference Call

The Company's management will host a conference call to discuss its fourth quarter and fiscal year 2018 financial results at 8:00 am US Eastern Time (5:00 am US Pacific Time/9:00 pm Beijing Time) on Friday, March 8, 2019.

To attend the conference call, please dial in using the information below. When prompted upon dialing-in, please provide the conference ID or ask for the "IT Tech Packaging Fourth Quarter and Fiscal Year 2018 Earnings Conference Call."

Date:

Friday, March 8, 2019

Time:

8:00 am ET

International Toll Free:

United States: +1-855-500-8701

Mainland China: 400-120-0654

Hong Kong: 800-906-606

International: +65-6713-5440

Conference ID:

1988048

This conference call will be broadcast live over the Internet, and can be accessed by all interested parties at http://www.itpacking.cn/ or   https://edge.media-server.com/m6/p/e5c2bjyr

Please access the link at least fifteen minutes prior to the start of the call to register, download, and install any necessary audio software.

A playback will be available through 11:00 am ET on March 8, 2019 to 8:59 am ET on March 16, 2019. To listen, please dial+1-855-452-5696 if calling from the United States, or +61-290-034-211 if calling internationally. Use the passcode 1988048 to access the replay.

About IT Tech Packaging, Inc.

Founded in 1996, IT Tech Packaging, Inc. is a leading manufacturer and distributor of diversified paper products in North China. Using recycled paper as its primary raw material (with the exception of its digital photo paper and tissue paper products), the Company produces and distributes three categories of paper products: corrugating medium paper, offset printing paper and tissue paper products. With production based in Baoding, Xingtai and Wei County in North China's Hebei Province, the Company is located strategically close to the Beijing and Tianjin region, home to a growing base of industrial and manufacturing activities and one of the largest markets for paper products consumption in the country. The Company has been listed on the NYSE MKT since December 2009.

Safe Harbor Statements

This press release may contain forward-looking statements. These forward-looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including risks outlined in the Company's public filings with the Securities and Exchange Commission, including the Company's latest annual report on Form 10-K. All information provided in this press release speaks as of the date hereof. Except as otherwise required by law, the Company undertakes no obligation to update or revise its forward-looking statements.

For more information, please contact:

Investor Relations:

Tony Tian, CFA                 
Weitian Group LLC
Email: ttian@weitianco.com
Phone: +1-732-910-9692

 

 

 

IT TECH PACKING, INC.

CONSOLIDATED BALANCE SHEETS

AS OF DECEMBER 31, 2018 AND 2017




December 31,



December 31,




2018



2017


ASSETS














Current Assets







Cash and bank balances


$

8,474,809



$

2,895,790


Restricted cash



3,642,616




6,121,637


Accounts receivable (net of allowance for doubtful accounts of $58,707 and $37,626
    as of December 31, 2018 and December 2017, respectively)



2,876,632




1,843,682


Inventories



2,923,516




8,474,165


Prepayments and other current assets



6,241,299




651,523











Total current assets



24,158,872




19,986,797











Property, plant, and equipment, net



167,829,716




189,388,709


Value-added tax recoverable



2,810,331




3,041,416


Deferred tax asset non-current



8,277,091




6,572,559











Total Assets


$

203,076,010



$

218,989,481











LIABILITIES AND STOCKHOLDERS' EQUITY


















Current Liabilities









Short-term bank loans


$

11,802,075



$

7,192,923


Current portion of long-term loans from credit union



2,491,549




6,366,502


Accounts payable



629,054




422,705


Notes payable



3,642,616




6,121,637


Due to related parties



413,336




60,378


Accrued payroll and employee benefits



213,536




231,247


Other payables and accrued liabilities



10,222,796




836,337


Income taxes payable



219,305




525,804











Total current liabilities



29,634,267




21,757,533











Loans from credit union



4,706,259




1,193,719


Loans from a related party



2,185,569




10,712,865











Total liabilities (including amounts of the consolidated VIE without recourse to the
    Company of $34,008,908 and $31,235,520 as of December 31, 2018 and 2017, 
    respectively)



36,526,095




33,664,117











Commitments and Contingencies


















Stockholders' Equity









Common stock, 500,000,000 shares authorized, $0.001 par value per share,
     20,022,316 and 21,450,316 shares issued and outstanding as of December 31,
     2018 and 2017, respectively



22,360




21,450


Additional paid-in capital



51,137,319




50,635,243


Statutory earnings reserve



6,080,574




6,080,574


Accumulated other comprehensive (loss) income



(3,263,952)




5,468,799


Retained earnings



112,573,614




123,119,298











Total stockholders' equity



166,549,915




185,325,364











Total Liabilities and Stockholders' Equity


$

203,076,010



$

218,989,481


 

 

 

IT TECH PACKING, INC.

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS)

FOR THE YEARS ENDED DECEMBER 31, 2018 AND  2017







Year Ended




December 31,




2018



2017









Revenues


$

86,746,758



$

117,023,578











Cost of sales



(80,926,357)




(97,067,627)











Gross Profit



5,820,401




19,955,951











Selling, general and administrative expenses



(13,098,373)




(11,307,395)


Loss from disposal of property, plant and equipment



(9,881)




(1,677,262)


Loss on impairment of assets



(3,894,461)




(2,291,027)











(Loss) Income from Operations



(11,182,314)




4,680,267











Other Income (Expense):









Interest income



36,632




34,590


Subsidy income



241,189




41,529


Interest expense



(1,492,119)




(2,433,770)











(Loss) Income before Income Taxes



(12,396,612)




2,322,616











Provision for Income Taxes



1,850,928




(662,828)











Net (Loss) Income



(10,545,684)




1,659,788











Other Comprehensive (Loss) Income









Foreign currency translation adjustment



(8,732,751)




10,910,190











Total Comprehensive (Loss) Income


$

(19,278,435)



$

12,569,978











(Losses) Earnings Per Share:


















Basic and Diluted (Losses) Earnings per Share


$

(0.49)



$

0.08











Outstanding – Basic and Diluted



21,618,305




21,450,316


 

 

 

IT TECH PACKING, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2018 AND 2017













































Balance at January 1,
    2017


21,450,316


$

21,450


$

50,635,243


$

6,080,574


$

(5,441,391)


$

121,459,510


$

172,755,386
























Foreign currency
    translation
    adjustment














10,910,190






10,910,190


Net income for the year
    of 2017

















1,659,788



1,659,788


Balance at December
   31, 2017


21,450,316



21,450



50,635,243



6,080,574



5,468,799



123,119,298



185,325,364
























Issuance of shares to 
   officer and directors


534,500



535



469,826












470,361


Issuance of shares to
   Weitian


37,500



375



32,250












32,625


Foreign currency 
   translation
   adjustment














(8,732,751)






(8,732,751)


Net loss for the year of
   2018

















(10,545,684)



(10,545,684)


Balance at December 
   31, 2018


22,022,316


$

22,360


$

51,137,319


$

6,080,574


$

(3,263,952)


$

112,573,614


$

166,549,915


 

  

 

IT TECH PACKING, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2018 AND 2017




Year Ended  




December 31,




2018


2017








Cash Flows from Operating Activities:






Net income


$

(10,545,684)


$

1,659,788


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








Depreciation and amortization



14,290,919



14,633,780


Loss from disposal and impairment of property, plant and equipment



4,524,581



3,968,289


(Recovery from) Allowance for bad debts



23,676



(45,309)


Share-based compensation expenses



470,361



-


Deferred tax



(2,089,439)



(3,010,577)


Changes in operating assets and liabilities:








Accounts receivable



(1,183,782)



2,265,428


Prepayments and other current assets



(5,726,546)



(79,264)


Inventories



5,322,320



(2,417,942)


Accounts payable



234,448



(166,464)


Advance from customers



-



(29,663)


Notes payable



(2,261,147)



3,707,933


Due to related parties



150,743



-


Accrued payroll and employee benefits



(6,855)



8,111


Other payables and accrued liabilities



6,878,137



(1,503,275)


Income taxes payable



(291,119)



(839,047)


Net Cash Provided by Operating Activities



9,790,613



18,151,788










Cash Flows from Investing Activities:








Purchases of property, plant and equipment



(2,198,852)



(9,380,702)


Proceeds from sale of property, plant and equipment



-



59,066










Net Cash Used in Investing Activities



(2,198,852)



(9,321,636)










Cash Flows from Financing Activities:








Proceeds from related party loans



4,522,295



-


Repayments of related party loans



(12,813,169)



-


Proceeds from short term bank loans



12,210,196



12,903,609


Repayment of bank loans



(12,149,899)



(11,153,463)


Proceeds from credit union loans



5,064,970



2,373,077


Payment of capital lease obligation



-



(9,040,260)










Net Cash Used in Financing Activities



(3,165,607)



(4,917,037)










Effect of Exchange Rate Changes on Cash and Cash Equivalents



(1,326,156)



609,348










Net Increase (Decrease) in Cash and Cash Equivalents



3,099,998



4,522,463










Cash, Cash Equivalents and Restricted Cash - Beginning of Year



9,017,427



4,494,964










Cash, Cash Equivalents and Restricted Cash - End of Year


$

12,117,425


$

9,017,427










Supplemental Disclosure of Cash Flow Information:








Cash paid for interest, net of capitalized interest cost


$

1,866,093


$

1,359,343


Cash paid for income taxes


$

515,001


$

3,247,406










Cash and bank balances



8,474,809



2,895,790


Restricted cash



3,642,616



6,121,637


Total cash, cash equivalents and restricted cash shown in the statement of cash
    flows



12,117,425



9,017,427


 

 

 

Cision View original content:http://www.prnewswire.com/news-releases/it-tech-packaging-inc-announces-fourth-quarter-and-fiscal-year-2018-financial-results-300808999.html

Source: IT Tech Packaging, Inc.
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