Newater Technology, Inc. Announces Year 2020 Audited Financial Results
NEW YORK, May 3, 2021 /PRNewswire/ -- Newater Technology, Inc. (NASDAQ: NEWA) (''NEWA,'' ''we,'' ''our'' or the ''Company''), a leading company specializing in development, production and application of DTRO equipment and systems used in waste water filtration, today announced its financial results for the year ended December 31, 2020.
The year ended December 31, 2020 Financial Highlights (all comparisons to the year ended December 31, 2019):
Revenues increased by 36% from $37.6 million to $51.16 million in 2020, our revenue growth in the year 2020 resulted primarily from increased demand for our systems. These increases can be evidenced in the total revenue from project sales, number of end customers, and number of large-scale projects.
Cost of revenues increased by 43% from $21.7 million to $30.99 million in 2020, the increase in cost of revenues directly corresponded to the increase in revenue during the same year.
Gross profit increased by 27% from $15.9 million to $20.2 million in 2020, while the gross profit margin was 39% in 2020.
Net income (before currency translation loss) increased by 29% from $4.3 million to $5.6 million in 2020, and the net profit margin in 2020 was 11%.
Total assets increased by 19% from $78 million to $93 million in 2020 mainly driven by the purchasing of more inventories and prepayment made for a land use right.
Basic earnings per share was $0.51 in 2020, compared to $0. 40 in 2019 and $0. 67 in 2018.
Mr. Yuebiao Li, the Company's CEO, commented "We are pleased with our accomplishments in 2020, we overcame the impact of COVID-19 epidemic. In the depressed market, we overcame difficulties and exploited the huge market in coal mine drainage treatment by using the company's patented process package and we completed the construction and production of the project in the same year. We are pleased with the expansion of our business in the field of steel coking wastewater treatment as well."
In 2021, we will continue to make more efforts to skillfully apply our products to more wastewater treatment fields and undertake larger projects, in order to achieve company's eternal goal of "renewable resources (New Water) recycling."
About Newater Technology, Inc.
Founded in 2012 and headquartered in Yantai, China, Newater, operating its business through its wholly owned subsidiary Yantai Jinzheng Eco-Technology Co. Ltd., specializes in the development, manufacture and sale of DTRO (Disk Tube Reverse Osmosis) and DTNF (Disk Tube Nano-Filtration) membranes for waste water treatment, recycling and discharge. Newater provides integrated technical solutions in engineering support and installation, technical advice and services, and, and other project-related solutions to turn wastewater into valuable clean water. Newater also provides wastewater treatment services, such as landfill leachate treatment and purification services.
More information about the Company can be found at www.dtNEWA.com.
The Company's products can be used across a wide spectrum of industries, including:
- Landfill leachate;
- Wastewater from coal mines;
- Industrial park common effluent; and
- Briny wastewater.
More information about the Company can be found at: www.dtNEWA.com
Notice
Rounding amounts and percentages: Certain amounts and percentages included in this press release have been rounded for ease of presentation. Percentage figures included in this press release have not in all cases been calculated on the basis of such rounded figures, but on the basis of such amounts prior to rounding. For this reason, certain percentage amounts in this press release may vary from those obtained by performing the same calculations using the figures in the financial statements. In addition, certain other amounts that appear in this press release may not sum due to rounding.
Forward-Looking Statements
This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company uses words such as "may", "will", "intend", "should", "believe", "expect", "anticipate", "project", "estimate" or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Specifically, the Company's statements regarding its ability to apply its products to more industries and obtain larger projects are forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company's expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the following: the Company's goals and strategies; the Company's future business development; product and service demand and acceptance; changes in technology; economic conditions; the growth of the water filtration industry in China; reputation and brand; the impact of competition and pricing; government regulations; fluctuations in general economic and business conditions in China and assumptions underlying or related to any of the foregoing and other risks contained in reports filed by the Company with the Securities and Exchange Commission. For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company's filings with the U.S. Securities and Exchange Commission, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.
For more information, please contact:
Newater Technology, Inc. |
|
Zhuo Zhang (CFO) Phone: +86 (535) 801-2997 Email: [email protected] |
Victor Liu (Corporate Manager) Phone : +86 150-6383-7878 Email : [email protected] |
F1-2 |
||||||||
NEWATER TECHNOLOGY, INC. AND SUBSIDIARIES |
||||||||
CONSOLIDATED BALANCE SHEETS |
||||||||
December 31, |
December 31, |
|||||||
2020 |
2019 |
|||||||
ASSETS |
||||||||
Current assets |
||||||||
Cash and cash equivalents |
$ |
4,462,530 |
$ |
9,944,765 |
||||
Restricted cash |
- |
4,021,177 |
||||||
Accounts receivable, net |
18,038,582 |
11,293,625 |
||||||
Accounts receivable - related parties, net |
8,806,238 |
2,392,087 |
||||||
Notes receivable |
107,235 |
360,505 |
||||||
Inventories |
21,737,156 |
13,715,369 |
||||||
Deferred cost of revenue |
- |
221,737 |
||||||
Advance to suppliers and other current assets, net |
6,196,694 |
4,515,435 |
||||||
Advance to suppliers and other current asset - related parties |
1,678,462 |
- |
||||||
Total current assets |
61,026,897 |
46,464,700 |
||||||
Retentions receivable, non-current |
4,651 |
734,140 |
||||||
Property, plant and equipment, net |
22,538,664 |
24,611,862 |
||||||
Land use rights, net |
2,093,873 |
2,008,096 |
||||||
Intangible asset, net |
151,677 |
- |
||||||
Operating lease right-of-use assets, net |
93,848 |
141,016 |
||||||
Deposit on loan agreement |
- |
918,643 |
||||||
Long-term investments |
1,074,142 |
2,997,419 |
||||||
Long-term prepaid expenses |
6,252,109 |
184,320 |
||||||
Total assets |
$ |
93,235,861 |
$ |
78,060,196 |
||||
LIABILITIES AND SHAREHOLDERS' EQUITY |
||||||||
Current liabilities |
||||||||
Accounts payable and bank acceptance notes to vendors |
$ |
8,922,232 |
$ |
8,099,529 |
||||
Accounts payable - related parties |
3,100,923 |
5,225,004 |
||||||
Loans due within one year |
27,268,410 |
11,809,449 |
||||||
Due to related parties |
5,785,045 |
- |
||||||
Advances from customers |
2,876,306 |
5,522,913 |
||||||
Advances from customers - related parties |
23,898 |
7,254,968 |
||||||
Income tax payables |
798,991 |
322,419 |
||||||
Accrued expenses and other payables |
5,414,379 |
6,971,505 |
||||||
Operating lease liabilities, current |
35,419 |
56,852 |
||||||
Deferred income, current |
45,958 |
43,061 |
||||||
Total current liabilities |
54,271,561 |
45,305,700 |
||||||
Deferred income, non-current |
- |
43,061 |
||||||
Deferred tax liabilities |
75,204 |
288,687 |
||||||
Operating lease liabilities, non-current |
37,604 |
68,420 |
||||||
Long-term loans, less current portion and unamortized debt issuance costs |
- |
1,377,217 |
||||||
Total non-current liabilities |
112,808 |
1,777,385 |
||||||
Total liabilities |
54,384,369 |
47,083,085 |
||||||
Shareholders' equity |
||||||||
Common shares ($0.001 par value, 200,000,000 shares authorized,10,809,000 shares issued and outstanding as of December 31, 2020 and December 31, 2019) |
10,809 |
10,809 |
||||||
Additional paid-in capital |
26,303,348 |
26,303,348 |
||||||
Statutory reserves |
2,941,715 |
2,267,219 |
||||||
Retained earnings |
8,834,286 |
3,946,021 |
||||||
Accumulated other comprehensive income (loss) |
761,334 |
(1,550,286) |
||||||
Total shareholders' equity |
38,851,492 |
30,977,111 |
||||||
Total liabilities and shareholders' equity |
$ |
93,235,861 |
$ |
78,060,196 |
||||
The accompanying notes are an integral part of these consolidated financial statements
F-3 |
||||||||||||
NEWATER TECHNOLOGY, INC. AND SUBSIDIARIES |
||||||||||||
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME |
||||||||||||
For the Years ended December 31, |
||||||||||||
2020 |
2019 |
2018 |
||||||||||
Net revenues |
$ |
26,350,543 |
$ |
23,716,978 |
$ |
25,973,963 |
||||||
Net revenues from related parties |
24,808,223 |
13,857,014 |
21,066,741 |
|||||||||
Total revenues |
51,158,766 |
37,573,992 |
47,040,704 |
|||||||||
Cost of revenues |
30,284,897 |
20,233,998 |
20,474,072 |
|||||||||
Cost of revenues from related parties |
706,401 |
1,450,627 |
5,669,252 |
|||||||||
Total cost of revenues |
30,991,298 |
21,684,625 |
26,143,324 |
|||||||||
Gross profit |
20,167,468 |
15,889,367 |
20,897,380 |
|||||||||
Operating expenses: |
||||||||||||
Selling, general and administrative expenses |
13,143,993 |
10,148,039 |
12,025,924 |
|||||||||
Total operating expenses |
13,143,993 |
10,148,039 |
12,025,924 |
|||||||||
Income from operations |
7,023,475 |
5,741,328 |
8,871,456 |
|||||||||
Interest expense |
1,757,396 |
1,087,051 |
658,290 |
|||||||||
Interest income |
(73,344) |
(38,328) |
(26,632) |
|||||||||
Government grants |
(1,985,061) |
(946,164) |
(627,748) |
|||||||||
Loss from equity investments |
560,969 |
17,023 |
- |
|||||||||
Other expenses (income) |
215,501 |
(153,546) |
(1,162) |
|||||||||
Total other expenses (income) |
475,461 |
(33,964) |
2,748 |
|||||||||
Income before income taxes provisions |
6,548,014 |
5,775,292 |
8,868,708 |
|||||||||
Income tax provisions |
985,253 |
1,463,745 |
1,657,279 |
|||||||||
Net income |
5,562,761 |
4,311,547 |
7,211,429 |
|||||||||
Other comprehensive income (loss) |
||||||||||||
Foreign currency translation adjustment |
2,311,620 |
(378,069) |
(1,159,084) |
|||||||||
Total comprehensive income |
$ |
7,874,381 |
$ |
3,933,478 |
$ |
6,052,345 |
||||||
Earnings per common share |
||||||||||||
Basic |
$ |
0.51 |
$ |
0.40 |
$ |
0.67 |
||||||
Diluted |
$ |
0.51 |
$ |
0.40 |
$ |
0.67 |
||||||
Weighted average common shares outstanding |
||||||||||||
Basic |
10,809,000 |
10,809,000 |
10,809,000 |
|||||||||
Diluted |
10,809,000 |
10,809,000 |
10,809,000 |
|||||||||
The accompanying notes are an integral part of these consolidated financial statements
F-4 |
||||||||||||||||||||||||||||
NEWATER TECHNOLOGY, INC. AND SUBSIDIARIES |
||||||||||||||||||||||||||||
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY |
||||||||||||||||||||||||||||
Number of Shares |
Common Shares |
Additional Paid-in Capital |
Retained |
Statutory Reserves |
Accumulated Other Comprehensive Income |
Total Shareholder's Equity |
||||||||||||||||||||||
Balance, December 31, 2017 |
10,809,000 |
$ |
10,809 |
$ |
15,059,181 |
$ |
5,228,733 |
$ |
705,698 |
$ |
(13,133) |
$ |
20,991,288 |
|||||||||||||||
Net income |
7,211,429 |
7,211,429 |
||||||||||||||||||||||||||
Statutory reserves |
(1,060,013) |
1,060,013 |
- |
|||||||||||||||||||||||||
Foreign currency translation adjustment |
(1,159,084) |
(1,159,084) |
||||||||||||||||||||||||||
Balance, December 31, 2018 |
10,809,000 |
$ |
10,809 |
$ |
15,059,181 |
$ |
11,380,149 |
$ |
1,765,711 |
$ |
(1,172,217) |
$ |
27,043,633 |
|||||||||||||||
Net income |
4,311,547 |
4,311,547 |
||||||||||||||||||||||||||
Statutory reserves |
(501,508) |
501,508 |
- |
|||||||||||||||||||||||||
Capital increase from retained earnings |
11,244,167 |
(11,244,167) |
- |
|||||||||||||||||||||||||
Foreign currency translation adjustment |
(378,069) |
(378,069) |
||||||||||||||||||||||||||
Balance, December 31, 2019 |
10,809,000 |
$ |
10,809 |
$ |
26,303,348 |
$ |
3,946,021 |
$ |
2,267,219 |
$ |
(1,550,286) |
$ |
30,977,111 |
|||||||||||||||
Net income |
5,562,761 |
5,562,761 |
||||||||||||||||||||||||||
Statutory reserves |
(674,496) |
674,496 |
- |
|||||||||||||||||||||||||
Foreign currency translation adjustment |
2,311,620 |
2,311,620 |
||||||||||||||||||||||||||
Balance, December 31, 2020 |
10,809,000 |
$ |
10,809 |
$ |
26,303,348 |
$ |
8,834,286 |
$ |
2,941,715 |
$ |
761,334 |
$ |
38,851,492 |
|||||||||||||||
The accompanying notes are an integral part of these consolidated financial statements
F-5 |
|||||||||||
NEWATER TECHNOLOGY, INC. AND SUBSIDIARIES |
|||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||||||
For the Years Ended December 31, |
|||||||||||
2020 |
2019 |
2018 |
|||||||||
Cash flows from operating activities |
|||||||||||
Net income |
$ |
5,562,761 |
$ |
4,311,547 |
$ |
7,211,429 |
|||||
Adjustments to reconcile net income to net cash used in operating activities: |
|||||||||||
Loss from equity method investments, net |
560,969 |
17,023 |
- |
||||||||
Depreciation and amortization expense |
2,159,715 |
1,549,296 |
558,327 |
||||||||
Deferred income taxes |
(220,332) |
892,548 |
(118,199) |
||||||||
Allowance for credit losses |
796,800 |
1,243,709 |
280,228 |
||||||||
Amortization of debt issuance costs |
161,911 |
324,221 |
103,772 |
||||||||
Noncash lease expense |
61,260 |
41,935 |
- |
||||||||
Loss on disposal of property, plant and equipment |
35,587 |
1,367 |
13,256 |
||||||||
Changes in operating assets and liabilities: |
|||||||||||
Accounts receivable, net |
(6,683,358) |
(1,509,728) |
(5,327,278) |
||||||||
Accounts receivable - related parties, net |
(5,915,753) |
(1,103,104) |
(1,427,078) |
||||||||
Notes receivable |
262,542 |
(356,648) |
(7,276) |
||||||||
Inventories |
(3,791,230) |
(2,923,465) |
(5,762,750) |
||||||||
Deferred cost of revenue |
223,880 |
117,910 |
383,382 |
||||||||
Deferred cost of revenue – related party |
- |
- |
1,765,856 |
||||||||
Advances to suppliers and other current assets, net |
(564,652) |
(311,090) |
(2,035,701) |
||||||||
Advances to suppliers and other current asset - related parties |
(1,587,875) |
- |
- |
||||||||
Retentions receivable, non-current |
736,837 |
(397,157) |
(358,505) |
||||||||
Deposit - related party |
- |
10,134 |
(10,583) |
||||||||
Other non-current assets |
- |
- |
- |
||||||||
Accounts payable and bank acceptance notes to vendors |
247,588 |
2,839,752 |
996,619 |
||||||||
Accounts payable - related parties |
(2,341,946) |
1,896,054 |
3,269,238 |
||||||||
Deferred income |
- |
43,433 |
- |
||||||||
Advances from customers |
(2,855,229) |
2,630,143 |
2,420,363 |
||||||||
Advances from customers - related parties |
(7,302,490) |
6,733,465 |
(125,099) |
||||||||
Deferred income, non-current |
(43,478) |
43,433 |
- |
||||||||
Operating lease liabilities |
(111,195) |
(76,752) |
- |
||||||||
Income tax payables |
430,333 |
(404,231) |
267,988 |
||||||||
Accrued expenses and other payables |
(2,455,366) |
(2,322,199) |
(4,481,539) |
||||||||
Net cash provided by (used in) operating activities |
(22,632,721) |
13,291,596 |
(2,383,550) |
||||||||
Cash flows from investing activities |
|||||||||||
Cash paid for long-term investment |
(2,873,522) |
(3,015,119) |
- |
||||||||
Proceeds from disposal of long-term investment |
4,574,914 |
- |
- |
||||||||
Purchase of intangible asset |
(143,491) |
- |
|||||||||
Purchase of property, plant and equipment |
(1,355,101) |
(2,316,967) |
(5,511,732) |
||||||||
Proceeds from sale of property, plant and equipment |
40,805 |
427,261 |
22,072 |
||||||||
Prepayment for property, plant and equipment |
(5,862,026) |
- |
(73,227) |
||||||||
Deposit on acquisition of subsidiary |
- |
- |
(200,000) |
||||||||
Net cash provided by (used in) investing activities |
(5,618,421) |
(4,904,825) |
(5,762,887) |
||||||||
Cash flows from financing activities |
|||||||||||
Proceeds from related parties |
5,386,618 |
- |
- |
||||||||
Repayment to related parties |
- |
- |
(9,703) |
||||||||
Deposit on loan agreements |
- |
(503,939) |
(473,698) |
||||||||
Collection of deposits on loan agreements |
911,809 |
- |
- |
||||||||
Proceeds from loans due within one year |
25,405,697 |
7,454,711 |
11,493,557 |
||||||||
Repayment of loans due within one year |
(7,601,156) |
(8,046,350) |
(11,952,224) |
||||||||
Proceeds from long-term loans |
- |
6,376,169 |
8,631,493 |
||||||||
Payment of debt issuance costs |
- |
(335,938) |
(284,219) |
||||||||
Repayment of long-term loans |
(5,762,171) |
(7,736,415) |
(730,595) |
||||||||
Net cash provided by (used in) financing activities |
18,340,797 |
(2,791,762) |
6,674,611 |
||||||||
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash |
406,933 |
(124,050) |
(404,956) |
||||||||
Net change in cash, cash equivalents and restricted cash |
(9,503,412) |
5,470,959 |
(1,876,782) |
||||||||
Cash, cash equivalents and restricted cash, beginning of the year |
13,965,942 |
8,494,983 |
10,371,765 |
||||||||
Cash, cash equivalents and restricted cash, end of the year |
$ |
4,462,530 |
$ |
13,965,942 |
$ |
8,494,983 |
|||||
Supplemental cash flow information |
|||||||||||
Cash paid for interest |
$ |
1,555,485 |
$ |
608,431 |
$ |
689,867 |
|||||
Cash paid for income taxes |
$ |
775,240 |
$ |
977,755 |
$ |
1,507,489 |
|||||
Non-cash investing and financing activities: |
|||||||||||
Properties acquired with loans |
$ |
- |
$ |
- |
$ |
52,161 |
|||||
Liabilities assumed in connection with purchase of property, plant and equipment |
$ |
158,806 |
$ |
2,980,582 |
$ |
2,636,770 |
|||||
Operating expenses paid by related parties |
$ |
- |
$ |
- |
$ |
9,703 |
|||||
Property, plant and equipment transferred from inventories |
$ |
548,058 |
$ |
2,791,339 |
$ |
1,566,314 |
|||||
Transfer from prepayments to property, plant and equipment |
$ |
72,850 |
$ |
- |
$ |
- |
|||||
Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheets |
|||||||||||
Cash and cash equivalents |
$ |
4,462,530 |
$ |
9,944,765 |
$ |
2,461,501 |
|||||
Restricted cash |
- |
4,021,177 |
6,033,482 |
||||||||
Total cash, cash equivalents and restricted cash |
$ |
4,462,530 |
$ |
13,965,942 |
$ |
8,494,983 |
|||||
SOURCE Newater Technology, Inc.
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