Fuwei Films Announces Unaudited Financial Results for the First Quarter of 2010
Teleconference to be Held on June 1st, 2010 at 8:00 a.m. EDT
BEIJING, May 28 /PRNewswire-Asia-FirstCall/ -- Fuwei Films (Holdings) Co. Ltd. (Nasdaq: FFHL) ("Fuwei Films" or the "Company"), a manufacturer and distributor of high-quality BOPET plastic films in China, today announced its unaudited financial results for the first quarter of 2010 ended March 31, 2010.
Highlights
-- Revenues were RMB 88.5 million (US$13.0 million), compared with
RMB 74.5 million in the same period of 2009;
-- Net income was RMB 0.3 million (US$0.04 million), compared with a net
loss of RMB 14.1 million in the same period of 2009;
-- Basic and diluted earnings per share was RMB 0.02(US$0.003), compared
with basic and diluted net loss per share of RMB 1.08 in the same
period of 2009;
-- Net cash provided by operations was RMB 6.6 million (US$1.0 million),
compared with RMB 9.5 million in the same period of 2009;
-- Sales of Specialty films increased by 105.7% compared with the same
period of 2009;
-- Overseas sales increased by 8.1% for the quarter compared to 2009.
"We had a good first quarter of 2010 and have returned to profitability. We believe the market demand for our BOPET film products to have stabilized and increased," said Mr. Xiaoan He, Chairman and CEO of Fuwei Films. "Our internal efforts at cutting our cost as well as a more robust global economy helped us in improving our business operation and we believe this trend will continue in 2010."
First Quarter of 2010 Results
Revenues were RMB 88.5 million (US$13.0 million), compared with RMB 74.5 million in the same period of 2009.
Sales of specialty films in the first quarter of 2010 were RMB 8.5 million (US$1.3 million), compared with RMB 4.1 million in the same period of 2009, and increase of 105.7% of total revenues.
The following is a breakdown of commodity and specialty film sales for the three-month periods ended March 31, 2010 and 2009 (amounts in thousands):
Three Month Three Month
Period Ended Period Ended
March 31, 2010 March 31, 2009
% of % of
RMB US$ Total RMB Total
Printing film 9,286 1,360 10.5% 7,128 9.6%
Stamping film 57,683 8,451 65.2% 31,188 41.9%
Metallization film 7,705 1,129 8.7% 12,273 16.5%
Special film 8,532 1,250 9.6% 4,148 5.6%
Base film for other
application 5,250 769 5.9% 19,780 26.5%
88,455 12,959 100.0% 74,517 100.0%
Overseas sales during the three month ended March 31, 2010 were RMB 11.3 million (US$1.7 million), which accounted for 12.8 % of our total net revenues, as compared with RMB 10.5 million and 14.1% in the same period in 2009. Overseas sales increased by 8.1% compared with the same periods in 2009. The increase in sales was mainly due to the increase of sales volume and sales prices.
The following is a breakdown of domestic versus overseas sales for the three-month periods ended March 31, 2010 and 2009 (amounts in thousands):
Three Month Three Month
Period Ended Period Ended
March 31, March 31,
2010 2009
% of % of
RMB US$ Total RMB Total
Sales in China 77,125 11,299 87.2% 64,034 85.9%
Sales in other
countries 11,331 1,660 12.8% 10,483 14.1%
88,455 12,959 100.0% 74,517 100.0%
Our gross profit was RMB 12.8 million (US$1.9 million) for the first three months of 2010, representing a gross margin of 14.4%, as compared to a gross profit of 0.1% from the same period in 2009, an increase of 14.3%. This was mainly due to an increase in average sales price of our products during the first three months of 2010 compared with the same period in 2009.
Operating expenses for the three months ended March 31, 2010 were RMB10.9 million (US$1.6 million), as compared to RMB16.3 million (US$2.4 million) or 33.2% lower than the same period in 2009. This decrease was mainly due to decreased delivery costs and decreased allowances for doubtful account receivable and other receivables.
During the first three months of 2010, the Company recorded an income tax expense of RMB 19,000 (US$ 3,000) compared to an income tax benefit of RMB 2.5 million (US$ 0.3 million) during the same period in 2009. This decrease of tax benefit was mainly due to decreased deferred income tax benefit from bad debt allowances and net loss carry forward.
Net income during the first three months of 2010 was RMB 0.3 million (US$ 0.04 million) compared to net loss of RMB 14.1 million (US$2.1 million) during the same period in 2009, representing an increase of RMB14.4 million from the same period in 2009. The increase of net income was mainly due to the increase in gross margin and decrease of the operating expenses.
Net cash provided by operating activities in the first quarter was RMB 6.6 million (US$1.0 million), compared with RMB 9.5 million in the same period of 2009.
Total shareholders' equity was RMB 511.9 million (US$75.0 million) as of March 31, 2010, compared with RMB 511.8 million as of December 31, 2009.
As of March 31, 2010, the Company had 13,062,500 basic and diluted total ordinary shares outstanding.
Conference Call Information
The Company will host a teleconference on Tuesday, June 1st, at 8:00 a.m. EDT / 8:00 p.m. Beijing time to discuss its quarterly results. To participate in the call, please dial +1-877-407-9205 in North America, or +1-201-689-8054 internationally, approximately 10 minutes prior to the scheduled start time.
A replay of the call can also be accessed via telephone by calling +1-877-660-6853 in North America, or +1-201-612-7415 internationally, and entering the following access codes: Account #: 286 and Conference ID: 350870. The replay will be available until June 8, 2010, at 11:59 p.m. EDT.
About Fuwei Films
Fuwei Films conducts its business through its wholly owned subsidiary, Fuwei Films (Shandong) Co., Ltd. ("Fuwei Shandong"). Fuwei Shandong develops, manufactures and distributes high-quality plastic films using the biaxial oriented stretch technique, otherwise known as BOPET film (biaxially oriented polyethylene terephthalate). Fuwei Fimls' BOPET film is widely used to package food, medicine, cosmetics, tobacco, and alcohol, as well as in the imaging, electronics, and magnetic products industries.
Safe Harbor
This press release contains information that constitutes forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are subject to risks. Risk factors that could contribute to such differences include those matters more fully disclosed in the Company's reports filed with the U.S. Securities and Exchange Commission which, among other things, include both the short and long-term effects of the global financial crisis on the Company and the BOPET film industry; competition in the BOPET film industry; growth of, and risks inherent in, the BOPET film industry in China; uncertainty as to future profitability and our ability to obtain adequate financing for our planned capital expenditure requirements; uncertainty as to our ability to continuously develop new BOPET film products and keep up with changes in BOPET film technology; risks associated with possible defects and errors in our products; uncertainty as to our ability to protect and enforce our intellectual property rights; uncertainty as to our ability to attract and retain qualified executives and personnel; and uncertainty in acquiring raw materials on time and on acceptable terms, particularly in view of the volatility in the prices of petroleum products in recent years. The forward-looking information provided herein represents the Company's estimates as of the date of the press release, and subsequent events and developments may cause the Company's estimates to change. The Company specifically disclaims any obligation to update the forward-looking information in the future. Therefore, this forward-looking information should not be relied upon as representing the Company's estimates of its future financial performance as of any date subsequent to the date of this press release. Actual results of our operations may differ materially from information contained in the forward-looking statements as a result of the risk factors.
For more information, please contact:
In China:
Ms. Maggie Huang
Investor Relations Manager
Phone: +86-10-6852-2612
Email: [email protected]
In the U.S.:
Ms. Leslie Wolf-Creutzfeldt
Investor Relations
Grayling
Phone: +1-646-284-9472
Email: [email protected]
FUWEI FILMS (HOLDINGS) CO., LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
AS OF MARCH 31, 2010 AND DECEMBER 31, 2009
(amounts in thousands except share and per share value)
(UNAUDITED)
March 31, December 31,
2010 2009
RMB US$ RMB
ASSETS
Current assets
Cash and cash equivalents 34,265 5,020 26,804
Restricted cash 9,891 1,449 12,541
Accounts and bills receivable, net 34,123 4,999 28,785
Inventories 46,993 6,885 45,039
Advance to suppliers 3,694 541 3,956
Prepayments and other receivables 911 134 957
Deferred tax assets - current 1,251 183 1,198
Total current assets 131,129 19,211 119,282
Plant, properties and equipment, net 310,362 45,468 318,600
Construction in progress 237,781 34,835 237,118
Lease prepayments, net 21,417 3,138 21,548
Advanced to suppliers - Long Term 2,041 299 2,367
Goodwill 10,276 1,505 10,276
Deposit 21,000 3,077 21,000
Deferred tax assets - non current 5,246 769 5,318
Total assets 739,252 108,302 735,509
LIABILITIES AND EQUITY
Current liabilities
Short-term borrowings 143,179 20,976 153,179
Accounts payables 25,766 3,775 25,898
Advance from customers 15,683 2,298 12,608
Accrued expenses and other payables 7,530 1,103 6,981
Total Current Liabilities 192,158 28,152 198,666
Long-term loan 35,000 5,128 25,000
Total liabilities 227,158 33,280 223,666
Commitments and contingencies
Equity
Shareholders' equity
Registered capital (of US$0.129752
par value; 20,000,000 shares
authorized; 13,062,500 issued and
outstanding) 13,323 1,952 13,323
Additional paid-in capital 311,907 45,695 311,907
Statutory reserve 29,338 4,298 29,338
Retained earnings 156,307 22,899 156,006
Cumulative translation adjustment 979 143 993
Total shareholders' equity 511,854 74,987 511,567
Non-controlling interest 240 35 276
Total equity 512,094 75,022 511,843
Total liabilities and equity 739,252 108,302 735,509
FUWEI FILMS (HOLDINGS) CO., LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME
FOR THE THREE MONTH PERIOD ENDED MARCH 31, 2010 AND 2009
(amounts in thousands except share and per share value)
(UNAUDITED)
The Periods End March 31,
2010 2009
RMB US$ RMB
Revenues, net 88,455 12,956 74,517
Cost of sales (75,689) (11,086) (74,444)
Gross profit 12,767 1,870 73
Operating expenses
Distribution expenses (3,396) (497) (4,897)
Administrative expenses (7,529) (1,103) (11,462)
Total operating expenses (10,925) (1,600) (16,359)
Operating income/(loss) 1,842 270 (16,286)
Other income/(expense)
- Interest income 14 2 101
- Interest expense (1,618) (237) --
- Others income/(expense), net 44 6 (445)
Total other expense (1,559) (228) (344)
Income/(loss) before income tax
benefit/(expense) 283 41 (16,630)
Income tax benefit/(expense) (19) (3) 2,494
Net income/(loss) 264 39 (14,136)
Net income/(loss) attributable to
non-controlling interests (36) (5) --
Net income/(loss) attributable to the
Company 300 44 (14,136)
Other comprehensive income/(loss)
- Foreign currency translation
adjustments (14) (2) (11)
Comprehensive income/(loss) 286 42 (14,147)
Earnings/(loss) per share,
0.02 0.003 (1.08)
Basic and diluted
Weighted average number ordinary
shares,
13,062,500 13,062,500 13,062,500
Basic and diluted
FUWEI FILMS (HOLDINGS) CO., LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTH PERIOD ENDED MARCH 31, 2010 AND 2009
(amounts in thousands except share and per share value)
(UNAUDITED)
Periods Ended Periods Ended
March 31, March 31,
2010 2009
RMB US$ RMB
Cash flow from operating activities
Net income/(loss) 264 39 (14,136)
Adjustments to reconcile net
income/(loss) to net cash provided
by operating activities
- Depreciation of property, plant and
equipment 9,707 1,422 7,284
- Amortization of intangible assets 113 17 113
- Deferred income taxes 19 3 (2,493)
- Bad debt expense/ 356 52 6,148
Changes in operating assets and
liabilities
- Accounts receivable (5,693) (834) 9,534
- Inventories (1,954) (286) (2,632)
- Advance to suppliers 262 38 4,033
- Prepaid expenses and other current
assets 23 3 (5,579)
- Accounts payable (130) (19) (44)
- Accrued expenses and other payables (419) (61) (361)
- Advance from customers 3,075 450 9,086
- Tax payable 978 143 (1,445)
Net cash provided by operating
activities 6,599 967 9,508
Cash flow from investing activities
Purchases of property, plant and
equipment (1,469) (215) (427)
Restricted cash related to trade
finance 2,650 388 2,647
Advance to suppliers - non current 326 48 (305)
Addition to construction in progress (663) (97) (2,205)
Net cash (used in)/provided by
investing activities 844 124 (290)
Cash flow from financing activities
Principal payments of short-term bank
loans (10,000) (1,465) (12,264)
Proceeds from short-term bank loans 10,000 1,465 10,000
Net cash used in financing activities -- -- (2,264)
Effect of foreign exchange rate
changes 18 4 (13)
Net increase (decrease) in cash and
cash equivalent 7,461 1,094 6,941
Cash and cash equivalent
At beginning of periods 26,804 3,926 15,823
At end of periods 34,265 5,020 22,764
SUPPLEMENTARY DISCLOSURE:
Interest paid 2,045 299 1,777
Income tax paid -- -- --
SOURCE Fuwei Films (Holdings) Co., Ltd.
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