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Ever-Glory Reports Fourth Quarter and Full Year 2017 Financial Resultsnew

Add: 2018   Update: 2018/03/28

 

 
Ever-Glory Reports Fourth Quarter and Full Year 2017 Financial Results
 
 
·       Full year 2017 retail revenue increased by 10.2% year-over-year to $225.3 million
·       Full year 2017 net income attributable to the Company increased by 84.2% to $12.5 million
NANJING, China, March 28, 2018 /PRNewswire/ -- Ever-Glory International Group, Inc. (the “Company” or “Ever-Glory”) (NASDAQ-GM: EVK), a retailer of branded fashion apparel and a leading global apparel supply chain solution provider, today reported its financial results for the fourth quarter and full year ended December 31, 2017.Fourth Quarter 2017 Financial Results
Total sales for the fourth quarter of 2017 were $130.4 million, an increase of 18.2% from $110.4 million in the fourth quarter of 2016. This increase was primarily driven by a 22.3% increase in our wholesale business and a 14.9% increase in retail business.
Sales for the Company’s branded fashion apparel retail division increased by % to $million for the fourth quarter of 2017, compared with $million for the fourth quarter of 2016. This increase was primarily due to an increase in same-store sales. The Company had retail stores as of December 31, 2017, compared with 1,378 retail stores as of December 31, 2016.  
Salesfor the Company’s wholesale divisioncreased by % to $million for the fourth quarter of 2017, compared with $ million for the fourth quarter of 2016. This increase was primarily attributable to an increase in sales in Hong Kong China, the United States and Mainland China partially offset by a decrease in sales in Japan, the United Kingdom, Europe-other and Germany. 
Total gross profit for the fourth quarter of 2017 creased by% to $million, compared with $million for the fourth quarter of 2016. Total gross margin increased to % from % for the fourth quarter of 201.
Gross profit for the retail business increased by % to $million for the fourth quarter of 2017, compared with $million for the fourth quarter of 2016. Gross margin remained flat% for the fourth quarter of 201.Gross profitfor the wholesale businesscreased by % to $million for the fourth quarter of 2017, compared with $ million for the fourth quarter of 2016. Gross margin creased to % from % for the fourth quarter of 201.
Selling expenses for the fourth quarter of 2017 increased by % to $million, or % of total sales, compared with $million, or % of total salesfor the fourth quarter of 2016. This increase was mainly attributable to higher retail sales.
General and administrative expenses for the fourth quarter of 2017 creased by % to $million, or % of total sales,compared with $million, or % of total salesfor the fourth quarter of 2016.
Income from operations for the fourth quarter of 2017 increased by % to $ million compared with $ million for the fourth quarter of 2016.
Net income attributablefor the fourth quarter of 2017 million compared with $million for the fourth quarter of 2016. Basic and diluted earnings per share were $0. for the fourth quarter of 2017 compared with $0. for the fourth quarter of 2016. for the full year of 2017 by % to $ million compared with $ million for the full year of 2016.
Full Year 2017 Financial Results
Total sales for the full year of 2017 were $ million, a .8% from $ million in the full year of 2016. This crease was primarily due to a 10.2% crease in retail sales and a 1.1% increase in wholesale sales.
Retail sales from the Company's branded fashion apparel retail division by % to $2 million for the full year of 2017, compared with $2 million for the full year of 2016. This was primarily due to an increase in same store sales.
Wholesale sales from the Company's wholesale business by % to $1 million for the full year of 2017, compared with $1 million for the full year of 2016. This was primarily due to increased sales in Hong Kong China, Germany, the United States and Mainland China, partially offset by decreased sales in Japan, Europe-other and the United Kingdom.
Total gross profit for the full year of 2017 by % to $1 million, compared with $121.2 million for the full year of 2016. Total gross margin for the full year of 2017 increased to 3% from 30.% for the full year of 2016.
Gross profit for retail business increased by % to $ million for the full year of 2017, compared with $ million for the full year of 2016. Gross margin for the full year of 2017 increased to % from 4% for the full year of 2016.
Gross profit for wholesale business increased by % to $ million for the full year of 2017, compared with $ million for the full year of 2016. Gross margin for the full year of 2017 increased to 19.0% compared with 17.6% for the full year of 2016.
Selling expenses for the full year of 2017 increased by % to $ million, or .7% of total sales, compared with $ million, or % of total sales for the full year of 2016. The increase was attributable to higher retail sales.
General and administrative expenses for the full year of 2017 by % to $3.1 million, or 8.% of total sales, compared with $3.0 million, or 8.% of total sales for the full year of 2016. The was mainly due to increased average salaries.Income from operations
Net income attributable to the Company for the full year of 2017 by % to $ million compared with $ million for the full year of 2016. Basic and diluted earnings per share were $0. and $0. for the full year of 2017 and 2016, respectively.
Balance Sheet
As of December 31, 2017, Ever-Glory had approximately $million of cash and cash equivalents, compared with approximately $ million as of December 31, 2016. Ever-Glory had working capital of approximately $million as of December 31, 2017, and outstanding bank loans of approximately $ million as of December 31, 2017.
Conference Call
The Company will hold a conference call at 8:00 a.m. Eastern Time on March 28, 2018(8:00 p.m. Beijing Time on March 28, 2018). Listeners can access the conference call by dialing +1-866-548-4713 or +1-323-794-2093 and using the access code 1797415. 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 March 28 through 11:59 p.m. Eastern Time on April 4, by dialing +1-844-512-2921 or +1-412-317-6671 and using the access code 1797415.
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 DECEMBER 31, 2017 AND 2016
 

 
 
2017
 
 
2016
 
ASSETS
 
 
 
 
 
 
CURRENT ASSETS
 
 
 
 
 
 
Cash and cash equivalents
 
$
62,876
 
 
$
45,288
 
Accounts receivable, net
 
 
81,859
 
 
 
67,644
 
Inventories
 
 
56,182
 
 
 
49,630
 
Value added tax receivable
 
 
3,757
 
 
 
2,938
 
Other receivables and prepaid expenses
 
 
5,139
 
 
 
3,674
 
Advances on inventory purchases
 
 
3,028
 
 
 
3,139
 
Amounts due from related parties
 
 
265
 
 
 
486
 
Total Current Assets
 
 
213,106
 
 
 
172,799
 
 
 
 
 
 
 
 
 
 
INTANGIBLE ASSETS
 
 
5,995
 
 
 
5,769
 
PROPERTY AND EQUIPMENT, NET
 
 
25,891
 
 
 
22,694
 
TOTAL ASSETS
 
$
244,992
 
 
$
201,262
 
 
 
 
 
 
 
 
 
 
LIABILITIES AND STOCKHOLDERS' EQUITY
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CURRENT LIABILITIES
 
 
 
 
 
 
 
 
Bank loans
 
$
37,730
 
 
$
29,232
 
Accounts payable
 
 
73,788
 
 
 
58,170
 
Accounts payable and other payables - related parties
 
 
4,675
 
 
 
4,337
 
Other payables and accrued liabilities
 
 
16,454
 
 
 
15,007
 
Value added and other taxes payable
 
 
6,052
 
 
 
5,118
 
Income tax payable
 
 
1,712
 
 
 
1,842
 
Total Current Liabilities
 
 
140,411
 
 
 
113,706
 
 
 
 
 
 
 
 
 
 
NONCURRENT LIABILITIES
 
 
 
 
 
 
 
 
Deferred tax liabilities
 
 
1,883
 
 
 
3,254
 
TOTAL LIABILITIES
 
 
142,294
 
 
 
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, 14,795,992 and 14,787,940 shares issued and outstanding as of December 31, 2017 and December 31, 2016, respectively)
 
 
15
 
 
 
15
 
Additional paid-in capital
 
 
3,620
 
 
 
3,602
 
Retained earnings
 
 
95,195
 
 
 
83,423
 
Statutory reserve
 
 
17,794
 
 
 
17,107
 
Accumulated other comprehensive income
 
 
2,585
 
 
 
(3,297
)
Amounts due from related party
 
 
(15,449
)
 
 
(15,936
)
Total equity attributable to stockholders of the Company
 
 
103,760
 
 
 
84,914
 
Noncontrolling interest
 
 
(1,062
)
 
 
(612
)
Total Equity
 
 
102,698
 
 
 
84,302
 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
 
$
244,992
 
 
$
201,262
 

 
 
EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(In thousands of U.S. Dollars, except share and per share data or otherwise stated)
FOR THE YEARS ENDED DECEMBER 31, 2017 AND 2016
 

 
 
2017
 
 
2016
 
 
 
 
 
 
 
 
SALES
 
$
415,581
 
 
$
392,666
 
 
 
 
 
 
 
 
 
 
COST OF SALES
 
 
279,839
 
 
 
271,506
 
 
 
 
 
 
 
 
 
 
GROSS PROFIT
 
 
135,742
 
 
 
121,160
 
 
 
 
 
 
 
 
 
 
OPERATING EXPENSES
 
 
 
 
 
 
 
 
Selling expenses
 
 
85,940
 
 
 
77,398
 
General and administrative expenses
 
 
35,053
 
 
 
34,042
 
Total operating expenses
 
 
120,993
 
 
 
111,440
 
 
 
 
   
 
 
 
   
 
INCOME FROM OPERATIONS
 
 
14,749
 
 
 
9,720
 
 
 
 
 
 
 
 
 
 
OTHER INCOME (EXPENSE)
 
 
 
 
 
 
 
 
Interest income
 
 
1,260
 
 
 
1,059
 
Interest expense
 
 
(1,648
)
 
 
(1,997
)
Other income
 
 
3,509
 
 
 
1,479
 
Total other income
 
 
3,121
 
 
 
541
 
 
 
 
 
 
 
 
 
 
INCOME BEFORE INCOME TAX EXPENSE
 
 
17,870
 
 
 
10,261
 
 
 
 
 
 
 
 
 
 
INCOME TAX EXPENSE
 
 
(5,805
)
 
 
(4,077
)
 
 
 
 
 
 
 
 
 
NET INCOME
 
 
12,065
 
 
 
6,184
 
 
 
 
 
 
 
 
 
 
Net loss attributable to the non-controlling interest
 
 
394
 
 
 
580
 
NET INCOME ATTRIBUTABLE TO THE COMPANY
 
$
12,459
 
 
$
6,764
 
 
 
 
 
 
 
 
 
 
NET INCOME
 
$
12,065
 
 
$
6,184
 
Foreign currency translation gain (loss)
 
 
5,882
 
 
 
(6,546
)
COMPREHENSIVE INCOME (LOSS)
 
$
17,947
 
 
$
(362
)
 
 
 
 
 
 
 
 
 
Comprehensive loss attributable to the noncontrolling interest
 
 
450
 
 
 
612
 
 
 
 
 
 
 
 
 
 
COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY
 
$
18,397
 
 
$
250
 
EARNINGS PER SHARE ATTRIBUTABLE TO THE COMPANY’S STOCKHOLDERS:
 
 
 
 
 
 
 
 
Basic and diluted
 
$
0.84
 
 
$
0.46
 
Weighted average number of shares outstanding Basic and diluted
 
 
14,795,992
 
 
 
14,787,270
 

 
 
 
 
 
 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 YEARS ENDED DECEMBER 31, 2017 AND 2016
 

 
 
2017
 
 
2016
 
CASH FLOWS FROM OPERATING ACTIVITIES
 
 
 
 
 
 
Net income
 
$
12,065
 
 
$
6,184
 
Adjustments to reconcile net income to cash provided by operating activities:
 
 
 
 
 
 
 
 
Depreciation and amortization
 
 
7,015
 
 
 
7,915
 
Loss from sale of property and equipment
 
 
24
 
 
 
41
 
Provision of bad debt allowance
 
 
1,223
 
 
 
1,976
 
Provision for obsolete inventories
 
 
4,624
 
 
 
7,111
 
Deferred income tax
 
 
(1,530
)
 
 
477
 
Stock-based compensation
 
 
18
 
 
 
5
 
Changes in operating assets and liabilities
 
 
 
 
 
 
 
 
Accounts receivable
 
 
(11,204
)
 
 
13,402
 
Inventories
 
 
(7,919
)
 
 
14,630
 
Value added tax receivable
 
 
(600
)
 
 
(398
)
Other receivables and prepaid expenses
 
 
(1,136
)
 
 
779
 
Advances on inventory purchases
 
 
307
 
 
 
2,773
 
Amounts due from related parties
 
 
(592
)
 
 
1,830
 
Accounts payable
 
 
11,489
 
 
 
(4,042
)
Accounts payable and other payables- related parties
 
 
351
 
 
 
953
 
Other payables and accrued liabilities
 
 
460
 
 
 
(6,058
)
Value added and other taxes payable
 
 
567
 
 
 
(1,372
)
Income tax payable
 
 
(238
)
 
 
(2,039
)
Net cash provided by operating activities
 
 
14,924
 
 
 
44,167
 
 
 
 
 
 
 
 
 
 
CASH FLOWS FROM INVESTING ACTIVITIES
 
 
 
 
 
 
 
 
Purchase of property and equipment
 
 
(8,564
)
 
 
(11,016
)
Net cash used in investing activities
 
 
(8,564
)
 
 
(11,016
)
 
 
 
 
 
 
 
 
 
CASH FLOWS FROM FINANCING ACTIVITIES
 
 
 
 
 
 
 
 
Proceeds from bank loans
 
 
62,693
 
 
 
102,519
 
Repayment of bank loans
 
 
(56,296
)
 
 
(115,839
)
Repayment of loans from related party
 
 
9,280
 
 
 
4,816
 
Advances to related party
 
 
(7,119
)
 
 
(1,204
)
Interest income received from related party
 
 
-
 
 
 
1,956
 
Net cash provided by (used in) financing activities
 
 
8,558
 
 
 
(7,752
)
 
 
 
 
 
 
 
 
 
EFFECT OF EXCHANGE RATE CHANGES ON CASH
 
 
2,670
 
 
 
(2,813
)
 
 
 
 
 
 
 
 
 
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
 
 
17,588
 
 
 
22,586
 
 
 
 
 
 
 
 
 
 
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
 
 
45,288
 
 
 
22,702
 
 
 
 
 
 
 
 
 
 
CASH AND CASH EQUIVALENTS AT END OF PERIOD
 
$
62,876
 
 
$
45,288
 
 
 
 
 
 
 
 
 
 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash paid during the period for:
 
 
 
 
 
 
 
 
Accrued interest income on amounts due from related party under counter-guarantee agreement (Note 12)
 
$
818
 
 
$
795
 
 
 
 
 
 
 
 
 
 
Interest
 
$
1,648
 
 
$
1,997
 
Income taxes
 
$
6,247
 
 
$
6,987
 

 

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