omniture

IT Tech Packaging, Inc. Announces Third Quarter 2019 Financial Results

Continued Improvement in Margin and Profitability, Strong Growth in Sales Volume, Net Income and Operating Income, with Increases of 53%, 266% and 313%, Respectively, in Q3 2019, Reached the Highest Level Since Q4 2016
Company to Host Earnings Conference Call on Friday, November 8, 2019, at 8:00 am EST
2019-11-08 00:51 5343

BAODING, China, Nov. 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 third quarter ended September 30, 2019.

Mr. Zhenyong Liu, Chairman and Chief Executive Officer of the Company, commented, "We are pleased to report solid financial results for the third quarter of 2019 with 53.2% increases in sales volume across all three product categories, which reached the highest level since the fourth quarter of 2016. With continued turnarounds and recovery of the operation, we grew our top line by 23.3% and delivered 313.3% growth in operating income, in the third quarter of 2019, and tissue paper and offset printing paper products generated $1.6 million and $7.0 million revenues, respectively. With 326.8% and 266.4% growth in overall gross profit and net income, respectively, our margins and profitability improved significantly in the recorded quarter thanks to continued increase in sales volume for all products as well as decreases in cost of materials and operating expenses. Looking ahead, we expect that the stable order trend will continue to carry over into the rest of the year and 2020."

Third Quarter 2019 Unaudited Financial Results



 For the Three Months Ended September 30,

 ($ millions)


2019


2018


 % Change

 Revenues


32.94


26.72


23.3%

 Regular Corrugating Medium Paper ("CMP")*


19.33


19.22


0.6%

 Light-Weight CMP**


5.02


6.85


-26.8%

 Offset Printing Paper


7.04


0.66


973.5%

 Tissue Paper Products


1.55


0.00


NM








 Gross profit


5.37


1.26


326.8%

 Gross profit (loss) margin


16.3%


4.7%


11.6 pp***

 Regular Corrugating Medium Paper ("CMP")*


14.7%


4.9%


9.8 pp***

 Light-Weight CMP**


15.9%


5.1%


10.8 pp***

 Offset Printing Paper


33.3%


-3.3%


36.6 pp***

 Tissue Paper Products


-38.9%


NM


NM








 Operating income (loss)


3.35


-1.57


313.3%

 Net income


2.34


-1.40


266.4%

 EBITDA


7.11


1.89


276.2%

 Basic and Diluted earnings (loss) per share


0.11


-0.07


257.1%








 * Products from PM6







 ** Products from PM1







 *** pp represents percentage points







 

  • Total sales volume of CMP, offset printing paper and tissue paper products increased by 53.2% to 72,246 tonnes, reaching record highs since the fourth quarter 2016
  • Revenue increased by 23.3% to $32.9 million, primarily attributable to increase in sales volume of corrugating medium paper ("CMP"), offset printing paper and tissue paper products, partially offset by the decreases in average selling prices (ASP) for both CMP and offset printing paper
  • Gross profit increased significantly by 326.8% to $5.4 million. Gross margin increased by 11.6 percentage point to 16.3%. The increase in gross profit were primarily due to the decrease in average cost of sales per tonne for CMP and offset printing paper, which was attributable to the lower average unit purchase costs of recycled paper board and recycled white scrap paper used as raw material for CMP products and offset printing paper products. Gross margins over regular CMP, Light-Weight CMP products and offset printing paper product increased to 14.7%, 15.9% and 33.3%, respectively
  • Income from operations increased by 313.3% to $3.3 million, compared to loss from operations of $1.6 million for the same period of last year
  • Net income was $2.3 million, an increase of 3.7 million, or 266.4%, from net loss of $1.4 million for the same period of last year. Earnings per basic and diluted share was $0.11, compared to loss per basic and diluted share of $0.07, for the same period of last year
  • Earnings before interest, taxes, depreciation and amortization ("EBITDA") increased by 276.2% to $7.1 million

Revenue

For the third quarter of 2019, total revenue increased by $6.2 million, or 23.3%, to $32.9 million from $26.7 million for the same period of last year. The increase in total revenue was mainly due to increases in sales volume of CMP products, offset printing paper and tissue paper products, partially offset by the decreases in average selling prices (ASP) for both CMP products and offset printing paper. Total sales volume of CMP, offset printing paper and tissue paper products during the period increased by 53.2% to 72,246 tonnes, compared to 47,149 tonnes sold during the same period of 2018.

The following table summarizes revenue, volume and ASP by product for the third quarter of 2019 and 2018, respectively:


2019


2018


 Revenue
($'000)


 Volume
(tonne)


 ASP
($/tonne)


 Revenue
($'000)


 Volume
(tonne)


 ASP
($/tonne)

 Regular CMP

19,332


47,487


407


19,219


33,928


566

 Light-Weight CMP

5,017


12,721


394


6,850


12,319


556

 Offset Printing Paper

7,038


10,198


690


656


902


727

 Tissue Paper Products

1,551


1,840


843


-


-


-

 Total

32,938


72,246


456


26,724


47,149


567

Revenue from CMP, including both regular CMP and light-Weight CMP, decreased by $1.7 million, or 6.6%, to $24.3 million and accounted for 73.9% of total revenue for the third quarter of 2019, compared to $26.1 million, or 97.5% of total revenue, for the same period of last year. The Company sold 60,208 tonnes of CMP at an ASP of $404/tonne in the third quarter of 2019, compared to 46,247 tonnes at an ASP of $564/tonne in the same period of last year.

Of the total CMP sales, revenue from regular CMP slightly increased by $0.1 million, or 0.6%, to $19.3 million, resulting from sales of 47,487 tonnes at an ASP of $407/tonne, during the third quarter of 2019, compared to revenue of $19.2 million, resulting from sales of 33,928 tonnes at an ASP of $566/tonne, for the same period of last year. Revenue from light-weight CMP decreased by $1.8 million, or 26.8%, to $5.0 million, resulting from sales of 12,721 tonnes at an ASP of $394/tonne for the third quarter of 2019, compared to revenue of $6.8 million, resulting from sales of 12,319 tonnes at an ASP of $556/tonne for the same period of last year.

Revenue from offset printing paper increased by $6.4 million, or 973.5%, to $7.0 million for the third quarter of 2019, from $0.7 million for the same period of last year. The Company sold 10,198 tonnes of offset printing paper at an ASP of $690/tonne in the third quarter of 2019, compared to 902 tonnes at an ASP of $727/tonne in the same period of last year.

We produce 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. We launched the complete line of processing base tissue paper with designated capacity of 15,000 tonnes/year, and producing finished tissue paper products with designated capacity of 10,000 tonnes/year. With the launch of PM8 in December 2018, the production and sales of tissue paper products have increased steadily in 2019. Revenue from tissue paper products was $1.6 million, 4.7% of the total revenues and resulting from sales of 1,840 tonnes at an ASP of $843/tonne, for the third quarter of 2019.

Gross Profit and Gross Margin

Total cost of sales increased by $2.1 million, or 8.2%, to $27.6 million for the third quarter of 2019 from $25.5 million for the same period of last year. Overall cost of sales per tonne was $382 for the third quarter of 2019, compared to $540 for the same period of last year. The decrease in overall cost of sales per tonne was mainly due to decreased material costs, especially lower average unit purchase costs of recycled paper board and recycled white scrap paper, which decreased by 44.4% and 44%, respectively, in the third quarter of 2019. Costs of sales per tonne for regular CMP, light-weight CMP, offset printing paper, and tissue paper products were $347, $332, $461, and $1,171, respectively, for the third quarter of 2019, compared to $539, $528, $751 and $nil, respectively, for the same period of last year.

Gross profit increased by $4.1 million, or 326.8%, to $5.4 million for the third quarter of 2019 from $1.3 million for the same period of last year. Overall gross margin was 16.3% for the third quarter of 2019, compared to 4.7% for the same period of last year. The increase in gross profit and gross margin were mainly related to the decrease in average cost of sales per tonne for CMP and offset printing paper, which was attributable to the lower average unit purchase costs of recycled paper board and recycled white scrap paper used as raw material for CMP products and offset printing paper products. Gross margins for regular CMP, light-weight CMP, offset printing paper, and tissue paper products were 14.7%, 15.9%, 33.3%, and negative 38.9%, respectively, for the third quarter of 2019, compared to 4.9%, 5.1%, negative 3.3%, and nil, respectively, for the same period of last year.

Selling, General and Administrative Expenses

Selling, general and administrative expenses ("SG&A") decreased by $0.8 million, or 28.5%, to $2.0 million for the third quarter of 2019 from $2.8 million for the same period of last year. The decrease was mainly related to less repair and maintenance costs incurred for the third quarter of 2019 as all of our production resumed since the first quarter of 2019, compared to the same period in 2018 that production was suspended and additional repair and maintenance costs incurred. As a percentage of total revenue, SG&A was 6.1% for the third quarter of 2019, compared to 10.6% for the same period of last year. 

Income (loss) from Operations

Income from operations was $3.3 million for the third quarter of 2019, compared to loss from operations of $1.6 million for the same period of last year. The increase in income from operations was primarily due to substantial increase in gross profit combined with decreased SG&A expenses this year as discussed above. Operating margin was 10.2% for the third quarter of 2019, compared to operating loss margin of 5.9% for the same period of last year.

Net Income

Net income was $2.3 million, or $0.11 per basic and diluted share, for the third quarter of 2019, compared to net loss of $1.4 million, or $0.07 loss per basic and diluted share, for the same period of last year.

EBITDA

EBITDA was $7.1 million for the third quarter of 2019, compared to $1.9 million for the same period of last 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 September 30,

 ($ millions)


2019



2018

 Net income (loss)


2.34



-1.40

 Add: Income tax


0.77



-0.54

         Net interest expense


0.24



0.37

         Depreciation and amortization


3.76



3.46

 EBITDA


7.11



1.89

 

Nine Months Ended September 30, 2019 Financial Results



 For the Nine Months Ended September 30,

 ($ millions)


2019


2018


 % Change

 Revenues


84.01


61.76


36.0%

 Regular Corrugating Medium Paper ("CMP")*


52.44


43.43


20.7%

 Light-Weight CMP**


13.69


13.10


4.5%

 Offset Printing Paper


13.27


5.21


154.7%

 Tissue Paper Products


4.60


0.00


NM

 Digital Photo Paper


0.00


0.01


NM








 Gross profit


8.09


3.58


126.0%

 Gross margin


9.6%


5.8%


-3.8 pp

 Regular Corrugating Medium Paper ("CMP")*


8.4%


6.6%


-1.8 pp

 Light-Weight CMP**


7.1%


5.1%


-2.0 pp

 Offset Printing Paper


29.8%


0.8%


29.0 pp

 Tissue Paper Products


-27.0%


N/A


NM








 Operating income (loss)


0.71


-6.10


111.6%

 Net income (loss)


0.07


-5.38


101.2%

 EBITDA


12.55


5.05


148.5%

 Basic and Diluted earnings per share


0.003


-0.25


101.2%








 * Products from PM6







 ** Products from PM1







 *** pp represents percentage points







Revenue

For the nine months ended September 30, 2019, total revenue increased by $22.2 million, or 36%, to $84 million from $61.8 million for the same period of last year. The increase in total revenue was mainly due to increase in sales volume of CMP, offset printing paper and tissue paper products, which was partially offset by the decrease in ASP of CMP and offset printing paper. Total sales volume of CMP, offset printing paper and tissue paper products during the period increased by 72% to 177,956 tonnes, compared to 103,446 tonnes sold during the same period of 2018.

The following table summarizes revenue, volume and ASP by product for the nine months ended September 30, 2019 and 2018, respectively:


 For the Nine Months Ended September 30,


2019


2018


 Revenue
($'000)


 Volume
(tonne)


 ASP
($/tonne)


 Revenue
($'000)


 Volume
(tonne)


 ASP
($/tonne)

 Regular CMP

52,440


121,774


431


43,434


74,141


586

 Light-Weight CMP

13,693


32,728


418


13,101


23,114


567

 Offset Printing
Paper

13,275


18,757


708


5,212


6,191


842

 Tissue Paper
Products

4,600


4,697


979


-


-


 NM

 Total

84,008


177,956


472


61,761


103,446


597

Revenue from CMP, including both regular CMP and light-Weight CMP increased by $9.6 million, or 17%, to $66.1 million, and accounted for 78.7% of total revenue for the nine months ended September 30, 2019, compared to $56.5 million, or 91.6% of total revenue for the same period of last year. The Company sold 154,502 tonnes of CMP at an ASP of $428/tonne in the nine months ended September 30, 2019, compared to 97,255 tonnes at an ASP of $581/tonne in the same period of last year.

Of the total CMP sales, revenue from regular CMP increased by $9 million, or 20.7%, to $52.4 million, resulting from sales of 121,774 tonnes at an ASP of $431/tonne during the nine months ended September 30, 2019, compared to revenue of $43.4 million, resulting from sales of 74,141 tonnes at an ASP of $586/tonne for the same period of last year. Revenue from light-weight CMP increased by $0.6 million, or 4.5%, to $13.7 million, resulting from sales of 32,728 tonnes at an ASP of $418/tonne for the nine months ended September 30, 2019, compared to revenue of $13.1 million, resulting from sales of 23,114 tonnes at an ASP of $567/tonne for the same period of last year.

Revenue from offset printing paper increased by $8.1 million, or 154.7%, to $13.3 million for the nine months ended September 30, 2019 from $5.2 million for the same period of last year. The Company sold 18,757 tonnes of offset printing paper at an ASP of $708/tonne in the nine months ended September 30, 2019, compared to 6,191 tonnes at an ASP of $842/tonne in the same period of last year.

Revenue from tissue paper products was $4.6 million for the nine months ended September 30, 2019, resulting from sales of 4,697 tonnes of tissue paper products at an ASP of $979/tonne in the nine months ended September 30, 2019.

Gross Profit and Gross Margin

Total cost of sales increased by $17.8 million, or 30.5%, to $75.9 million for the nine months ended September 30, 2019 from $58.2 million for the same period of last year. The increase in overall cost of sales was mainly a result of the increase in sales volume, partially offset by the decrease of cost of recycled paper board and recycled white scrap paper. Average cost of sales per tonne for regular CMP, light-weight CMP and offset printing paper decreased by 28%, 27.7% and 40.5%, respectively. Costs of sales per tonne for regular CMP, light-weight CMP, offset printing paper, tissue paper products were, $394, $389, $497, and $1,244, respectively, for the nine months ended September 30, 2019, compared to $547, $538, $835, and $nil, respectively, for the same period of last year.

Total gross profit increased by $4.5 million, or 126%, to $8.1 million for the nine months ended September 30, 2019 from $3.6 million for the same period of last year. The increase was mainly due to (i) the increase in quantities sold of CMP, offset printing paper, tissue paper and (ii) the decrease of material purchase price of CMP and offset printing paper, partially offset by the decrease of ASP of these products. Overall gross margin decreased by 3.8 percentage points to 9.6% for the nine months ended September 30, 2019 from 5.8% for the same period of last year. Gross margins for regular CMP, light-weight CMP, offset printing paper and tissue paper products were 8.4%, 7.1%, 30.0% and negative 27.0%, respectively, for the nine months ended September 30,2019, compared to 6.6%, 5.1%, 0.8%, and nil, respectively, for the same period of last year.

Selling, General and Administrative Expenses

SG&A expenses decreased by $2.3 million, or 23.3%, to $7.4 million for the nine months ended September 30, 2019 from $9.7 million for the same period of last year. As a percentage of total revenue, SG&A expenses was 8.8% for the nine months ended September 30, 2019, compared to 15.7% for the same period of last year.

Income from Operations

Income from operations was$0.7 million for the nine months ended September 30, 2019, compared to loss from operations of $6.1 million for the same period of last year. Operating margin was 0.8% for the nine months ended September 30, 2019, compared to operating loss margin of 9.9% for the same period of last year.

Net Income

Net Income increased by $5.4 million, or 101.2%, to $0.07 million, or earnings per basic and diluted share of $0.003, for the nine months ended September 30, 2019. This compared to net loss of $5.4 million, or loss per basic and diluted share of $0.25, for the same period of last year.

EBITDA

EBITDA increased by $7.5 million, or 148.5%, to $12.6 million for the nine months ended September 30, 2019 from $5.1 million for the same period of last 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 Nine Months Ended September 30,

 ($ millions)


2019



2018

 Net income (loss)


0.07



-5.38

 Add: Income tax


0.21



-1.63

         Net interest expense


0.73



1.18

         Depreciation and amortization


11.55



10.87

 EBITDA


12.55



5.05

Cash, Liquidity and Financial Position

As of September 30, 2019, the Company had cash and bank balances, short-term debt (including short-term bank loans, current portion of long-term loans from credit union and related party loans) and long-term debt (including loans from credit union and related party loans) of $4.8 million, $7.4 million and $8.8 million, respectively, compared to $8.5 million, $14.3 million, and $6.9 million, respectively, at the end of 2018.

Net accounts receivable was $2.8 million as of September 30, 2019, compared to $2.9 million as of December 31, 2018. Net inventory was $7.0 million as of September 30, 2019, compared to $2.9 million at the end of 2018. As of September 30, 2019, the Company had current assets of $20.6 million and current liabilities of $61.0 million, resulting in a working capital deficit of $40.4 million. This compared to current assets of $24.2 million, current liabilities of $29.6 million and working capital deficit of $5.5 million at the end of 2018.

Net cash provided by operating activities was $4.6 million for the nine months ended September 30, 2019, compared to net cash provided by operating activities of $1.8 million for the same period of last year. Net cash used in investing activities was $6.4 million for the nine months ended September 30, 2019, compared to $1.8 million for the same period of last year. Net cash used in financing activities was $5.2 million for the nine months ended September 30, 2019, compared to net cash provided by financing activities of $0.8 million for the same period of last year.

Recent development

On October 31, 2019, the shareholders of the Company at the Company's Annual Shareholders General Meeting adopted and approved the 2019 Omnibus Equity Incentive Plan of IT Tech Packaging, Inc. (the "2019 ISP"). Under the 2019 ISP, the Company has reserved a total of 2,000,000 shares of common stock for issuance as or under awards to be made to the directors, officers, employees and/or consultants of the Company and its subsidiaries.

Earnings Conference Call

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 Third Quarter 2019 Earnings Conference Call."

Date:

Friday, November 8, 2019

Time:

8:00 am EST

International Toll Free:

United States: +1-866-519-4004

Mainland China: 400-620-8038

Hong Kong: 800-906-601

International: +65-6713-5090

Conference ID:

1585869

This conference call will be broadcast live on the Internet and can be accessed by all interested parties at: https://edge.media-server.com/mmc/p/2ssokezr .

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 EST on November 8, 2019 to 7:59 am EST on November 16, 2019. To listen, please dial+1-855-452-5696 if calling from the United States, or +61-281-990-299 if calling internationally. Use the passcode 1585869 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 tissue paper products), ITP produces and distributes three categories of paper products: corrugating medium paper, offset printing paper and tissue paper products. With production based in Baoding and Xingtai in North China's Hebei Province, ITP 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. ITP 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:

At the Company Email: ir@itpackaging.cn  
Tel: +86 0312 8698215

Investor Relations:
Melody Shi, CPA
EverGreen Consulting Inc.
Email: ir@changqingconsulting.com

 

 

 

IT TECH PACKAGING, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF SEPTEMBER 30, 2019 AND DECEMBER 31, 2018

(Unaudited)






September 30,


December 31,


2019


2018

ASSETS












Current Assets






Cash and bank balances

$

4,805,861


$

8,474,809

Restricted cash


-



3,642,616

Accounts receivable (net of allowance for doubtful
accounts of $56,638 and $58,707 as of September 30,
2019 and December 2018, respectively)


2,775,304



2,876,632

Inventories


7,010,419



2,923,516

Prepayments and other current assets


5,982,730



6,241,299







Total current assets


20,574,314



24,158,872







Property, plant, and equipment, net


153,108,508



167,829,716

Value-added tax recoverable


2,620,515



2,810,331

Deferred tax asset non-current


9,827,679



8,277,091

Other non-current assets


45,273,629



-







Total Assets

$

231,404,645


$

203,076,010







LIABILITIES AND STOCKHOLDERS' EQUITY












Current Liabilities






Short-term bank loans

$

6,362,312


$

11,802,075

Current portion of long-term loans from credit union


311,046



2,491,549

Accounts payable


857,218



629,054

Advance from customers


83,315



-

Notes payable


-



3,642,616

Due to related parties


766,544



413,336

Accrued payroll and employee benefits


239,501



213,536

Other payables and accrued liabilities


51,062,036



10,222,796

Income taxes payable


1,332,680



219,305







Total current liabilities


61,014,652



29,634,267







Loans from credit union


6,701,636



4,706,259

Loans from a related party


2,120,771



2,185,569







Total liabilities (including amounts of the
consolidated VIE without recourse to the Company of
$67,168,878 and $34,008,908 as of September 30,
2019 and December 31, 2018, respectively)


69,837,059



36,526,095







Commitments and Contingencies












Stockholders' Equity






Common stock, 500,000,000 shares authorized,
$0.001 par value per share, 22,054,816 shares issued


22,684



22,360

Additional paid-in capital


51,154,544



51,137,319

Statutory earnings reserve


6,080,574



6,080,574

Accumulated other comprehensive loss


(8,329,334)



(3,263,952)

Retained earnings


112,639,118



112,573,614







Total stockholders' equity


161,567,586



166,549,915







Total Liabilities and Stockholders' Equity

$

231,404,645


$

203,076,010

 

 

 

IT TECH PACKAGING, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 AND 2018

(Unaudited)




Three Months Ended


Nine Months Ended



September 30,


September 30,



2019



2018


2019


2018















Revenues


$

32,937,917



$

26,723,657


$

84,008,157


$

61,761,041















Cost of sales



(27,563,185)




(25,464,314)



(75,917,762)



(58,181,584)















Gross Profit



5,374,732




1,259,343



8,090,395



3,579,457















Selling, general and
administrative expenses



(2,024,547)




(2,829,933)



(7,413,879)



(9,670,992)

Gain (Loss) from disposal of
property, plant and equipment



-




237



-



(10,026)

Gain on acquisition of a
subsidiary



(879)




-



30,518



-





























Income (Loss) from
Operations



3,349,306




(1,570,353)



707,034



(6,101,561)















Other Income (Expense):














Interest income



1,413




5,222



61,787



32,641

Subsidy income



(2,800)




(5,786)



233,488



244,723

Interest expense



(236,987)




(372,276)



(731,027)



(1,183,269)















Income (Loss) before
Income Taxes



3,110,932




(1,943,193)



271,282



(7,007,466)















Provision for Income Taxes



(772,905)




538,231



(205,780)



1,626,222















Net Income (Loss)



2,338,027




(1,404,962)



65,502



(5,381,244)















Other Comprehensive Loss














Foreign currency translation
adjustment



(4,810,379)




(6,994,097)



(5,065,382)



(9,222,113)















Total Comprehensive Loss


$

(2,472,352)



$

(8,399,059)


$

(4,999,880)


$

(14,603,357)















Earnings (Losses) Per
Share:




























Basic and Diluted Earnings
(Losses) per Share


$

0.11



$

(0.07)


$

0.003


$

(0.25)





























Outstanding – Basic and
Diluted



22,028,171




21,450,316



22,028,171



21,450,316

 

 

 

IT TECH PACKAGING, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2019 AND 2018

(Unaudited)






Nine Months Ended



September 30,



2019



2018









Cash Flows from Operating Activities:








Net income


$

65,502



$

(5,381,244)

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








Depreciation and amortization



11,547,650




10,873,536

Loss from disposal and impairment of property, plant and equipment

-




10,026

Allowance for bad debts



(339)




(11,444)

Gain on acquisition of a subsidiary



(30,518)




-

Deferred tax



(1,853,728)




(1,629,706)

Changes in operating assets and liabilities:








Accounts receivable



16,894




572,184

Prepayments and other current assets



185,780




(3,528,818)

Inventories



(4,307,754)




3,562,834

Accounts payable



254,749




(354,689)

Advance from customers



85,993




-

Notes payable



(3,648,250)




(2,294,280)

Related parties



367,277




114,714

Accrued payroll and employee benefits



33,334




(35,419)

Other payables and accrued liabilities



726,564




437,532

Income taxes payable



1,155,880




(525,502)

Net Cash Provided by Operating Activities



4,599,034




1,809,724









Cash Flows from Investing Activities:








Purchases of property, plant and equipment



(4,917,650)




(1,812,280)

Acquisition of a subsidiary



(1,531,531)




-









Net Cash Used in Investing Activities



(6,449,181)




(1,812,280)









Cash Flows from Financing Activities:








Proceeds from related party loans



-




4,588,559

Repayments of related party loans



-




(9,177,118)

Proceeds from short term bank loans



3,940,110




9,635,974

Proceeds from credit union loans



2,334,880





Repayment of bank loans



(11,499,285)




(4,282,655)









Net Cash (Used in) Provided by Financing Activities



(5,224,295)




764,760









Effect of Exchange Rate Changes on Cash and Cash
Equivalents



(237,122)




(677,172)









Net (Decrease) Increase in Cash and Cash Equivalents



(7,311,564)




85,032









Cash, Cash Equivalents and Restricted Cash - Beginning of
Period



12,117,425




9,017,427









Cash, Cash Equivalents and Restricted Cash - End of
Period


$

4,805,861



$

9,102,459









Supplemental Disclosure of Cash Flow Information:








Cash paid for interest, net of capitalized interest cost


$

659,613



$

1,409,695

Cash paid for income taxes


$

888,881



$

522,547

















Cash and bank balances



4,805,861




5,468,315

Restricted cash



-




3,634,144

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



4,805,861




9,102,459

 

 

 

Cision View original content:http://www.prnewswire.com/news-releases/it-tech-packaging-inc-announces-third-quarter-2019-financial-results-300954065.html

Source: IT Tech Packaging, Inc.
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