▌ News Releases

Ever-Glory Reports Third Quarter 2017 Financial Resultsnew

Add: 2017   Update: 2017/11/13

 

Ever-Glory Reports Third Quarter 2017 Financial Results
·         Retail revenue increased by 24.9% year-over-year to $51.3 million
·         Income from operations increased by 131.3% year-over-year
 
NANJING, China, November 13, 2017 /PRNewswire/ -- Ever-Glory International Group, Inc. (the “Company” or “Ever-Glory”) (NASDAQ: EVK), a retailer of branded fashion apparel and a leading global apparel supply chain solution provider, today reported its financial results for the third quarter ended September 30, 2017.
 
Mr. Yihua Kang, Chairman, President and Chief Executive Officer of Ever-Glory, said, “Constantly building upon our growing brand recognition and leading supply chain management capabilities, we reported a solid third quarter with both revenue and net income delivering year-over-year growth. In particular, our retail revenue increased by 24.9% compared with the year-ago period as both our in-fashion collections with our upgraded store images and best-in-class customer service continue to receive high marks from our customers. We continued to optimize our store network during the quarter by strengthening our quick response system and better managing our inventory levels.  As of September 30, 2017, we managed a nationwide network of 1,363 stores and launched a new store design for Velwin in July.
 
“While our wholesale business in the third quarter remained flat compared with the year-ago period, we’re pleased to achieve the stabilized results even as overall market conditions in many of our key global markets remained challenging in the quarter,” continued Mr. Kang. “Looking ahead, we expect sales in European areas to remain stable while sales in Japan to remain weak. However, we continued our efforts in cost management and managed to improve our gross margin for wholesale business on a year-over-year basis.
 
“Overall, we are very pleased with our third quarter results. They support our conviction and the priorities we have set for ourselves, as well as the strategies we continue to follow to strengthen the foundations of our business. We believe these goals and objectives will enable us to capture the right opportunities when market conditions improve,” concluded Mr. Kang.
 
Mr. Jason Jiansong Wang, Chief Financial Officer of Ever-Glory, added, “The solid third quarter results, coupled with our ability to increase operating leverage, resulted in expanded overall gross margin and operating income during this quarter. While we continued to improve our wholesale gross margin, third quarter retail gross margin was impacted by higher production costs as we proactively cleared out-of-season inventory. Going forward, we remain confident in the long-term prospects of our business and we will continue implementing our margin enhancement and cost control measures to further strengthen the profitability of our business.”
 
Third Quarter 2017 Financial Results
 
Total sales for the third quarter of 2017 were $120.3 million, an increase of 9.4% from $109.9 million in the third quarter of 2016. This increase was primarily attributable to a 0.2% increase in sales in our wholesale business and a 24.9% increase in our retail business.
 
Sales for the Company’s branded fashion apparel retail division increased by 24.9% to $51.3 million for the third quarter of 2017, compared with $41.1 million for the third quarter of 2016. This increase was primarily due to increased same-store sales. The Company had 1,363 retail stores as of September 30, 2017, compared with 1,345 retail stores as of September 30, 2016.
 
Salesfor the Company’s wholesale division slightly increased by 0.2% to $69.0 million for the third quarter of 2017, compared with $68.9 million for the third quarter of 2016. This increase was primarily due to an increase in sales in Mainland China and Hong Kong partially offset by a decrease in sales in Germany, the United Kingdom, Europe-Other, Japan and the United States. 
 
Total gross profit for the third quarter of 2017 increased by 12.3% to $33.3 million, compared with $29.6 million for the third quarter of 2016. Total gross margin increased to 27.6% from 26.9% for the third quarter of 2016.
 
Gross profit for the retail business increased by 17.8% to $23.0 million for the third quarter of 2017, compared with $19.6 million for the third quarter of 2016. Gross margin decreased to 44.9% from 47.6% for the third quarter of 2016.
 
Gross profitfor the wholesale business increased by 1.6% to $10.2 million for the third quarter of 2017, compared with $10.1 million for the third quarter of 2016. Gross margin increased to 14.8% from 14.6% for the third quarter of 2016.
 
Selling expenses for the third quarter of 2017 increased by 9.3% to $20.2 million, or 16.8% of total sales, compared with $18.5 million, or 16.8% of total sales for the third quarter of 2016. The increase was mainly attributable to higher retail sales.
 
General and administrative expenses for the third quarter of 2017 increased by 3.1% to $10.2 million, or 8.5% of total sales, compared with $9.9 million, or 9.0% of total sales for the third quarter of 2016. The increase was attributable to the increased average salaries.
 
Income from operations for the third quarter of 2017 increased by 131.3% to $2.8 million compared with $1.2 million for the third quarter of 2016.
 
Net income attributable to the Companyfor the third quarter of 2017 was $3.2 million compared with a net income attributable to the Company of $0.6 million for the third quarter of 2016. Basic and diluted earnings per share were $0.22 for the third quarter of 2017 compared with basic and diluted earnings per share of $0.04 for the third quarter of 2016.
 
Balance Sheet
 
As of September 30, 2017, Ever-Glory had approximately $40.8 million of cash and cash equivalents, compared with approximately $45.3 million as of December 31, 2016. Ever-Glory had working capital of approximately $65.7 million and outstanding bank loans of approximately $44.9 million as of September 30, 2017.
 
Conference Call
 
The Company will hold a conference call at 8:00 a.m. Eastern Time on November 13, 2017 (9:00 p.m. Beijing Time on November 13, 2017). Listeners can access the conference call by dialing +1-888-394-8218 or +1-323-701-0225 and using the access code 4697641. The conference call will also be webcast live over the Internet and can be accessed at the Company’s website at http://www.everglorygroup.com.
 
A replay of the conference call will be available from 11:00 a.m. Eastern Time on November 13 through 11:59 p.m. Eastern Time on November 20, by dialing +1-844-512-2921 or +1-412-317-6671 and using the access code 4697641.
 
About Ever-Glory International Group, Inc.
 
Based in Nanjing, China, Ever-Glory International Group, Inc. is a retailer of branded fashion apparel and a leading global apparel supply chain solution provider. Ever-Glory is the first Chinese apparel Company listed on the American Stock Exchange (now named as NYSE MKT) in July 2008 and then transferred to The NASDAQ Global Market on December 31, 2015. Ever-Glory offers apparel to woman in China under its own brands "La go go", "Velwin", "Sea To Sky" and "idole". Ever-Glory is also a leading global apparel supply chain solution provider with a focus on middle-to-high end casual wear, outerwear, and sportswear brands. Ever-Glory services a number of well-known brands and retail stores by providing a complete set of supply chain management services, including: fabric development and design, sampling, sourcing, quality control, manufacturing, logistics, customs clearance and distribution.
 
Forward-Looking Statements
 
Certain statements in this release and other written or oral statements made by or on behalf of Ever-Glory International Group, Inc. (the "Company") are "forward looking statements" within the meaning of the federal securities laws.
Statements regarding future events and developments and the Company's future performance, as well as management's expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements within the meaning of these laws. The forward looking statements are subject to a number of risks and uncertainties including, without limitation, market acceptance of the Company's products and offerings, development and expansion of the Company's wholesale and retail operations, the Company's continued access to capital, currency exchange rate fluctuation and other risks and uncertainties. The actual results the Company achieves (including, without limitation, the results stemming from the future implementation of the Company's strategies and the revenue, net income and new retail store projections set forth herein) may differ materially from those contemplated by any forward-looking statements due to such risks and uncertainties (many of which are beyond the Company's control). These statements are based on management's current expectations and speak only as of the date of such statements. Readers should carefully review the risks and uncertainties described in the Company's latest Annual Report on Form 10-K and other documents that the Company files from time to time with the U.S. Securities and Exchange Commission. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
 
For investor and media inquiries, please contact:
 
Ever-Glory International Group
Dandan Song
Tel: +86-25-5209-6817
E-Mail: sdd@ever-glory.com.cn
 
The Piacente Group, Inc.
Emilie Wu
China: +86-10-5730-6200
US: +1-212-481-2050
E-Mail: everglory@tpg-ir.com
 
     
  
 
 


EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. Dollars, except share and per share data or otherwise stated)
AS OF SEPTEMBER 30, 2017 (UNAUDITED) AND DECEMBER 31, 2016

 
 
2017
 
 
2016
 
 
 
 
 
 
 
 
 
 
ASSETS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CURRENT ASSETS
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
40,799
 
 
$
45,288
 
Accounts receivable, net
 
 
82,550
 
 
 
67,644
 
Inventories
 
 
50,116
 
 
 
49,630
 
Value added tax receivable
 
 
3,844
 
 
 
2,938
 
Other receivables and prepaid expenses
 
 
6,672
 
 
 
3,674
 
Advances on inventory purchases
 
 
4,927
 
 
 
3,139
 
Amounts due from related parties
 
 
934
 
 
 
486
 
Total Current Assets
 
 
189,842
 
 
 
172,799
 
 
 
 
 
 
 
 
 
 
INTANGIBLE ASSETS
 
 
5,881
 
 
 
5,769
 
PROPERTY AND EQUIPMENT, NET
 
 
23,815
 
 
 
22,694
 
TOTAL ASSETS
 
$
219,538
 
 
$
201,262
 
 
 
 
 
 
 
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CURRENT LIABILITIES
 
 
 
 
 
 
 
 
Bank loans
 
$
44,937
 
 
$
29,232
 
Accounts payable
 
 
56,447
 
 
 
58,170
 
Accounts payable and other payables - related parties
 
 
4,660
 
 
 
4,337
 
Other payables and accrued liabilities
 
 
13,690
 
 
 
15,007
 
Value added and other taxes payable
 
 
2,728
 
 
 
5,118
 
Income tax payable
 
 
1,651
 
 
 
1,842
 
Total Current Liabilities
 
 
124,113
 
 
 
113,706
 
 
 
 
 
 
 
 
 
 
NONCURRENT LIABILITIES
 
 
 
 
 
 
 
 
Deferred tax liabilities
 
 
1,345
 
 
 
3,254
 
TOTAL LIABILITIES
 
 
125,458
 
 
 
116,960
 
 
 
 
 
 
 
 
 
 
COMMITMENTS AND CONTINGENCIES
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
STOCKHOLDERS’ EQUITY
 
 
 
 
 
 
 
 
Stockholders’ equity:
 
 
 
 
 
 
 
 
Preferred stock ($.001 par value, authorized 5,000,000 shares, no shares issued and outstanding)
 
 
-
 
 
 
-
 
Common stock ($.001 par value, authorized 50,000,000 shares, 14,792,836 and 14,787,940 shares issued and outstanding As of September 30, 2017 and December 31, 2016, respectively)
 
 
15
 
 
 
15
 
Additional paid-in capital
 
 
3,612
 
 
 
3,602
 
Retained earnings
 
 
90,318
 
 
 
83,423
 
Statutory reserve
 
 
17,107
 
 
 
17,107
 
Accumulated other comprehensive income
 
 
50
 
 
 
(3,297
)
Amounts due from related party
 
 
(15,999
)
 
 
(15,936
)
Total equity attributable to stockholders of the Company
 
 
95,103
 
 
 
84,914
 
Noncontrolling interest
 
 
(1,023
)
 
 
(612
)
Total Equity
 
 
94,080
 
 
 
84,302
 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
 
$
219,538
 
 
$
201,262
 

 
EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS)
(In thousands of U.S. Dollars, except share and per share data or otherwise stated)
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2017 AND 2016 (UNAUDITED)
 

 
 
Three months ended
 
 
Nine months ended
 
 
 
September 30,
 
 
September 30,
 
 
 
2017
 
 
2016
 
 
2017
 
 
2016
 
NET SALES
 
$
120,257
 
 
$
109,926
 
 
$
285,148
 
 
$
282,295
 
COST OF SALES
 
 
87,007
 
 
 
80,312
 
 
 
192,740
 
 
 
197,623
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
GROSS PROFIT
 
 
33,250
 
 
 
29,614
 
 
 
92,408
 
 
 
84,672
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
OPERATING EXPENSES
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Selling expenses
 
 
20,238
 
 
 
18,522
 
 
 
60,206
 
 
 
55,477
 
General and administrative expenses
 
 
10,167
 
 
 
9,862
 
 
 
24,900
 
 
 
24,128
 
Total Operating Expenses
 
 
30,405
 
 
 
28,384
 
 
 
85,106
 
 
 
79,605
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
INCOME FROM OPERATIONS
 
 
2,845
 
 
 
1,230
 
 
 
7,302
 
 
 
5,067
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
OTHER INCOME (EXPENSES)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest income
 
 
370
 
 
 
233
 
 
 
909
 
 
 
854
 
Interest expense
 
 
(562
)
 
 
(580
)
 
 
(1,207
)
 
 
(1,511
)
Other income
 
 
1,987
 
 
 
253
 
 
 
3,088
 
 
 
939
 
Total Other Income (Expenses)
 
 
1,795
 
 
 
(94
)
 
 
2,790
 
 
 
282
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
INCOME BEFORE INCOME TAX EXPENSE
 
 
4,640
 
 
 
1,136
 
 
 
10,092
 
 
 
5,349
 
Income tax expense
 
 
(1,522
)
 
 
(724
)
 
 
(3,573
)
 
 
(2,385
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NET INCOME
 
 
3,118
 
 
 
412
 
 
 
6,519
 
 
 
2,964
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net loss attributable to the non-controlling interest
 
 
115
 
 
 
208
 
 
 
376
 
 
 
441
 
NET INCOME ATTRIBUTABLE TO THE COMPANY
 
 
3,233
 
 
 
620
 
 
 
6,895
 
 
 
3,405
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NET INCOME
 
$
3,118
 
 
$
412
 
 
$
6,519
 
 
$
2,964
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign currency translation income (loss)
 
 
1,823
 
 
 
(471
)
 
 
3,345
 
 
 
(2,860
)
COMPREHENSIVE INCOME (LOSS)
 
 
4,941
 
 
 
(59
)
 
 
9,864
 
 
 
104
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Comprehensive loss attributable to the non-controlling interest
 
 
133
 
 
 
205
 
 
 
411
 
 
 
434
 
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY
 
$
5,074
 
 
$
146
 
 
$
10,275
 
 
$
538
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
EARNINGS PER SHARE ATTRIBUTABLE TO THE COMPANY’S STOCKHOLDERS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic and diluted
 
$
0.22
 
 
$
0.04
 
 
$
0.47
 
 
$
0.23
 
Weighted average number of shares outstanding
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic and diluted
 
 
14,792,836
 
 
 
14,787,940
 
 
 
14,791,778
 
 
 
14,787,044
 

 
 
 
 
EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of U.S. Dollars, except share and per share data or otherwise stated)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2017 AND 2016 (UNAUDITED)
 

 
 
2017
 
 
2016
 
CASH FLOWS FROM OPERATING ACTIVITIES
 
 
 
 
 
 
Net income
 
$
6,519
 
 
$
2,964
 
Adjustments to reconcile net income to cash provided by operating activities:
 
 
 
 
 
 
 
 
Depreciation and amortization
 
 
5,066
 
 
 
5,337
 
Loss from sale of property and equipment
 
 
5
 
 
 
40
 
Provision of bad debt allowance
 
 
679
 
 
 
975
 
Inventory write-down
 
 
4,624
 
 
 
7,111
 
Deferred income tax
 
 
(2,004
)
 
 
(79
)
Stock-based compensation
 
 
10
 
 
 
5
 
Changes in operating assets and liabilities
 
 
 
 
 
 
 
 
Accounts receivable
 
 
(12,805
)
 
 
4,127
 
Inventories
 
 
(3,423
)
 
 
19,293
 
Value added tax receivable
 
 
(762
)
 
 
(2,452
)
Other receivables and prepaid expenses
 
 
(3,395
)
 
 
(638
)
Advances on inventory purchases
 
 
(1,619
)
 
 
1,618
 
Amounts due from related parties
 
 
(937
)
 
 
1,918
 
Accounts payable
 
 
(3,738
)
 
 
(14,467
)
Accounts payable and other payables- related parties
 
 
232
 
 
 
630
 
Other payables and accrued liabilities
 
 
(2,219
)
 
 
(3,289
)
Value added and other taxes payable
 
 
(2,561
)
 
 
(1,987
)
Income tax payable
 
 
(256
)
 
 
(2,460
)
Net cash used in (provided by) operating activities
 
 
(16,584
)
 
 
18,646
 
 
 
 
 
 
 
 
 
 
CASH FLOWS FROM INVESTING ACTIVITIES
 
 
 
 
 
 
 
 
Purchases of property and equipment
 
 
(4,356
)
 
 
(8,577
)
Net cash used in investing activities
 
 
(4,356
)
 
 
(8,577
)
 
 
 
 
 
 
 
 
 
CASH FLOWS FROM FINANCING ACTIVITIES
 
 
 
 
 
 
 
 
Proceeds from bank loans
 
 
47,570
 
 
 
75,263
 
Repayment of bank loans
 
 
(33,372
)
 
 
(69,125
)
Repayment of loans from related party
 
 
7,596
 
 
 
1,824
 
Advances to related party
 
 
(6,464
)
 
 
(1,216
)
Net cash provided by financing activities
 
 
15,330
 
 
 
6,746
 
 
 
 
 
 
 
 
 
 
EFFECT OF EXCHANGE RATE CHANGES ON CASH
 
 
1,121
 
 
 
(1,200
)
 
 
 
 
 
 
 
　
 
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
 
 
(4,489
)
 
 
15,615
 
 
 
 
 
 
 
 
　
 
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
 
 
45,288
 
 
 
22,702
 
 
 
 
 
 
 
 
　
 
CASH AND CASH EQUIVALENTS AT END OF PERIOD
 
$
40,799
 
 
$
38,317
 
 
 
 
 
 
 
 
 
 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash paid during the period for:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest
 
$
1,207
 
 
$
1,511
 
Income taxes
 
$
4,521
 
 
$
5,362
 

 

版权所有：江苏华瑞服装有限公司
苏ICP备17030860号