Earnings Conference Call is Scheduled for Wednesday, April 18, 2018, 8:00 am ET
BAODING, China, April 17, 2018 /PRNewswire/ -- Orient Paper, Inc.
(NYSE MKT: ONP) ("Orient Paper" or the "Company"), a leading
manufacturer and distributor of diversified paper products in
North China, today announced its
financial results for the fourth quarter and fiscal year ended
December 31, 2017.
|
|
For the
Three Months Ended December 31,
|
($
millions)
|
|
2017
|
|
2016
|
|
%
Change
|
Revenues
|
|
35.4
|
|
31.4
|
|
12.9%
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
24.6
|
|
18.3
|
|
34.8%
|
Light-Weight
CMP**
|
|
5.2
|
|
5.3
|
|
-2.5%
|
Offset Printing
Paper
|
|
5.4
|
|
6.5
|
|
-16.8%
|
Tissue Paper
Products
|
|
0.3
|
|
1.4
|
|
-80.1%
|
Digital Photo
Paper
|
|
0.0
|
|
0.0
|
|
-100.0%
|
|
|
|
|
|
|
|
Gross
profit
|
|
3.6
|
|
7.5
|
|
-52.1%
|
Gross
margin
|
|
10.2%
|
|
24.0%
|
|
-13.8 pp
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
8.9%
|
|
23.2%
|
|
-14.3 pp
|
Light-Weight
CMP**
|
|
10.0%
|
|
28.8%
|
|
-18.9 pp
|
Offset Printing
Paper
|
|
16.5%
|
|
25.1%
|
|
-8.6 pp
|
Tissue Paper
Products
|
|
5.8%
|
|
11.0%
|
|
-5.3 pp
|
Digital Photo
Paper
|
|
NA
|
|
-58.8%
|
|
NM
|
|
|
|
|
|
|
|
Operating
income (loss)
|
|
-1.7
|
|
4.6
|
|
-136.2%
|
Net income
(loss)
|
|
-1.6
|
|
3.1
|
|
-153.1%
|
EBITDA
|
|
2.0
|
|
8.3
|
|
-75.3%
|
Basic and
Diluted earnings (loss) per share
|
|
-0.08
|
|
0.14
|
|
-153.1%
|
|
|
|
|
|
|
|
* Products
from PM6
|
|
|
|
|
|
|
** Products
from PM1
|
|
|
|
|
|
|
*** pp
represents percentage points
|
|
|
|
|
|
|
Revenue increased by 12.9% to $35.4
million, primarily due to increase in average selling prices
("ASPs") and partially offset by decreases in sales volumes across
all product categories.
- Gross profit decreased by 52.1% to $3.6
million. Gross margin decreased by 13.8 percentage points to
10.2%. The decrease in gross margin was across all product
categories.
- Net loss was $1.6 million, or
loss per share of $0.08, compared to
net income of $3.1 million, or
earning per share of $0.14, for the
same period of the prior year. The Company booked loss on
impairment of assets of $2.3 million
in the fourth quarter of 2017.
- Earnings before interest, taxes, depreciation and amortization
("EBITDA") decreased by 75.3% to $2.0
million.
"Revenue increased by 12.9% to $35.4
million for the fourth quarter of 2017, benefitted from an
increase of 35.8% in blended ASP and partially offset by a decrease
of 16.9% in overall sales volume," said Zhenyong Liu, Chairman and Chief Executive
Officer of Orient Paper.
Mr, Liu continued, "As previously announced, the Company
temporarily suspended its production in January 2018 due to a government-mandated
restriction on the natural gas supply, which is the energy resource
we need for production. As of March 14,
2018, the company resumed production at its manufacturing
facilities. As a result of the temporary suspension of production,
we expect revenue to be significantly impacted in the first quarter
of 2018."
Fourth Quarter 2017 Financial Results
Revenue
For the fourth quarter of 2017, total revenue increased by
$4.1 million, or 12.9%, to
$35.4 million from $31.4 million for the same period of the prior
year. The increase in total revenue was mainly due to increase in
ASP and partially offset by decreases in sales volume across all
product categories. Production of tissue paper was suspended in
September and October for the replacement of coal boilers, and
began intermittent production in the following months. In addition,
we decreased the production volume of regular CMP, light-Weight CMP
and offset printing paper and sales of these products due to
environmental conditions in Northern
China. The government strengthened its pollution control and
rectification measures, resulting in restrictions on production in
the manufacturing industry. As a result, the production volume of
regular CMP, light-Weight CMP and offset printing paper and sales
of these products decreased in the fourth quarter of 2017 as
compared to the same period of the prior year. The following table
summarizes revenue, volume and ASP by product for the fourth
quarter of 2017 and 2016, respectively:
Revenue from CMP, including both regular CMP and light-Weight
CMP, increased by $6.2 million, or
26.5%, to $29.8 million and accounted
for 84.1% of total revenue for the fourth quarter of 2017, compared
to $23.6 million, or 75.1%, of total
revenue for the same period of the prior year. The Company sold
53,705 tonnes of CMP at an ASP of $555/tonne in the fourth quarter of 2017,
compared to 60,701 tonnes at an ASP of $388/tonne in the same period of the prior
year.
Of the total CMP sales, revenue from regular CMP increased by
$6.4 million, or 34.8%, to
$24.6 million, resulting from sales
of 44,411 tonnes at an ASP of $555/tonne, during the fourth quarter of 2017,
compared to revenue of $18.3 million,
resulting from sales of 47,338 tonnes at an ASP of $386/tonne, during the same period of the prior
year. Revenue from light-weight CMP decreased by $0.1 million, or 2.5%, to $5.2 million, resulting from sales of 9,294
tonnes at an ASP of $554/tonne for
the fourth quarter of 2017, compared to revenue of $5.3 million, resulting from sales of 13,363
tonnes at an ASP of $395/tonne for
the same period of the prior year.
Revenue from offset printing paper decreased by $1.1 million, or 16.8%, to $5.4 million for the fourth quarter of 2017, from
$6.5 million for the same period of
the prior year. The Company sold 6,512 tonnes of offset printing
paper at an ASP of $826/tonne in the
fourth quarter of 2017, compared to 10,815 tonnes at an ASP of
$598/tonne in the same period of the
prior year.
Revenue from tissue paper products decreased by $1.1 million, or 80.1%, to $0.3 million for the fourth quarter of 2017, from
$1.4 million for the same period of
the prior year. The Company sold 185 tonnes of tissue paper
products at an ASP of $1,456/tonne in
the fourth quarter of 2017, compared to 1,129 tonnes at an ASP of
$1,201/tonne in the same period of
the prior year.
We had no revenue from digital photo paper for the fourth
quarter of 2017 and for the same period of the prior year. In
June 2016, we suspended the
production of digital photo paper due to low market demand for our
products and are now upgrading the production line to produce more
competitive products. We expect to resume our digital photo paper
production in the near future.
Gross Profit and Gross Margin
Total cost of sales increased by $8.0
million, or 33.5%, to $31.8
million for the fourth quarter of 2017, from $23.8 million for the same period of the prior
year. Cost of sales per tonne was $527 for the fourth quarter of 2017, compared to
$328 for the same period of the prior
year. The increase in overall cost of sales per tonne was mainly
attributable to the higher average unit purchase costs of recycled
paper board, cost of recycled white scrap paper and additional
subsidies to the labors during the production restriction, and
partially offset by the use of natural gas and liquefied gas to
replace coal into the production. Costs of sales per tonne for
regular CMP, light-weight CMP, offset printing paper, and tissue
paper products were, $505,
$499, $690, and $1,373,
respectively, for the fourth quarter of 2017, compared to
$296, $281, $448, and
$1,068, respectively, for the same
period of the prior year.
Total gross profit decreased by $3.9
million, or 52.1%, to $3.6
million for the fourth quarter of 2017, from $7.5 million for the same period of the prior
year. Overall gross margin was 10.2% for the fourth quarter of
2017, compared to 24.0% for the same period of the prior year.
Gross margins for regular CMP, light-weight CMP, offset printing
paper, and tissue paper products were 8.9%, 10.0%, 16.5%, and 5.8%,
respectively, for the fourth quarter of 2017, compared to 23.2%,
28.8%, 25.1%, and 11.0%, respectively, for the same period of the
prior year.
Selling, General and Administrative Expenses
Selling, general and administrative expenses ("SG&A")
increased by $0.3 million, or 9.3%,
to $3.0 million for the fourth
quarter of 2017 from $2.7 million for
the same period of the prior year. As a percentage of total
revenue, SG&A was 8.4% for the fourth quarter of 2017, compared
to 8.7% for the same period of the prior year.
Loss on Impairment of Assets
The Company booked loss on impairment of assets of $2.3 million in the fourth quarter of 2017,
compared to $nil in the same period of the prior year.
Income (loss) from Operations
Loss from operations was $1.7
million for the fourth quarter of 2017, compared to income
from operations of $4.6 million for
the same period of the prior year. Operating loss margin was 4.7%
for the fourth quarter of 2017, compared to operating income margin
of 14.8% for the same period of the prior year.
Net Income (loss)
Net loss was $1.6 million, or
$0.08 per loss basic and diluted
share, for the fourth quarter of 2017, compared to net income of
$3.1 million, or earnings per basic
and diluted share of $0.14, for the
same period of the prior year.
EBITDA
EBITDA decreased by $6.2 million,
or 75.3%, to $2.0 million for the
fourth quarter of 2017 from $8.3
million for the same period of the prior year.
Note 1: Non-GAAP Financial Measures
In addition to our U.S. GAAP results, this press release
includes a discussion of EBITDA, a non-GAAP financial measure as
defined by the Securities and Exchange Commission ("SEC"). The
Company defines EBITDA as net income before interest, income taxes,
depreciation and amortization. EBITDA is a key measure used by
management to evaluate our results and make strategic decisions.
Management believes this measure is useful to investors because it
is an indicator of operational performance. Because not all
companies use identical calculations, the Company's presentation of
EBITDA may not be comparable to similarly titled measures of other
companies, and should not be viewed as an alternative to measures
of financial performance or changes in cash flows calculated in
accordance with the U.S. GAAP.
Reconciliation of
Net Income to EBITDA
|
(Amounts expressed
in US$)
|
|
|
For the
Three Months Ended December 31,
|
($
millions)
|
2017
|
|
2016
|
Net
income
|
-1.6
|
|
3.1
|
Add: Income
tax
|
-0.4
|
|
1.0
|
Net
interest expense
|
0.4
|
|
0.5
|
Depreciation and amortization
|
3.7
|
|
3.6
|
EBITDA
|
2.0
|
|
8.3
|
Full Year 2017
Financial Results
|
|
|
For the
Twelve Months Ended December 31,
|
($
millions)
|
|
2017
|
|
2016
|
|
%
Change
|
Revenues
|
|
117.0
|
|
134.7
|
|
-13.2%
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
80.4
|
|
77.9
|
|
3.2%
|
Light-Weight
CMP**
|
|
15.6
|
|
16.7
|
|
-6.8%
|
Offset Printing
Paper
|
|
18.7
|
|
33.4
|
|
-44.0%
|
Tissue Paper
Products
|
|
2.4
|
|
6.1
|
|
-61.2%
|
Digital Photo
Paper
|
|
0.0
|
|
0.7
|
|
-100.0%
|
|
|
|
|
|
|
|
Gross
profit
|
|
20.0
|
|
25.5
|
|
-21.8%
|
Gross
margin
|
|
17.1%
|
|
18.9%
|
|
-1.9 pp
|
Regular
Corrugating Medium Paper ("CMP")*
|
|
16.9%
|
|
17.1%
|
|
-0.2 pp
|
Light-Weight
CMP**
|
|
18.9%
|
|
25.5%
|
|
-6.5 pp
|
Offset Printing
Paper
|
|
17.3%
|
|
22.7%
|
|
-5.4 pp
|
Tissue Paper
Products
|
|
6.4%
|
|
11.8%
|
|
-5.4 pp
|
Digital Photo
Paper
|
|
NA
|
|
-58.7%
|
|
NM
|
|
|
|
|
|
|
|
Operating
income
|
|
4.7
|
|
13.0
|
|
-63.9%
|
Net
income
|
|
1.7
|
|
7.3
|
|
-77.2%
|
EBITDA
|
|
19.4
|
|
28.3
|
|
-31.6%
|
Basic and
Diluted earnings per share
|
|
0.08
|
|
0.34
|
|
-76.5%
|
|
|
|
|
|
|
|
* Products
from PM6
|
|
|
|
|
|
|
** Products
from PM1
|
|
|
|
|
|
|
*** pp
represents percentage points
|
|
|
|
|
|
|
Revenue
For the year ended December 31,
2017, total revenue decreased by $17.7 million, or 13.2%, to $117.0 million from $134.7
million for 2016. The decrease in total revenue was mainly
decreases in sales volume across all product categories and
partially offset by a moderate increase in blended ASP. Production
of tissue paper was suspended in September and October for the
replacement of coal boilers, and began intermittent production in
the following months. In addition, we decreased the production
volume of regular CMP, light-Weight CMP and offset printing paper
and sales of these products due to environmental conditions in
Northern China. The government
strengthened its pollution control and rectification measures,
resulting in restrictions on production in the manufacturing
industry. As a result, the production volume of regular CMP,
light-Weight CMP and offset printing paper and sales of these
products decreased in 2017 as compared to 2016. The following table
summarizes revenue, volume and ASP by product for 2017 and 2016,
respectively:
|
For the
Twelve Months Ended December 31,
|
|
2017
|
|
2016
|
|
Revenue
($'000)
|
|
Volume
(tonne)
|
|
ASP
($/tonne)
|
|
Revenue
($'000)
|
|
Volume
(tonne)
|
|
ASP
($/tonne)
|
Regular
CMP
|
80,379
|
|
173,399
|
|
464
|
|
77,889
|
|
230,382
|
|
338
|
Light-Weight
CMP
|
15,600
|
|
33,690
|
|
463
|
|
16,736
|
|
47,841
|
|
350
|
Offset Printing
Paper
|
18,688
|
|
26,610
|
|
702
|
|
33,391
|
|
52,255
|
|
639
|
Tissue Paper
Products
|
2,357
|
|
1,804
|
|
1,306
|
|
6,071
|
|
4,917
|
|
1,235
|
Digital Photo
Paper
|
-
|
|
-
|
|
-
|
|
657
|
|
372
|
|
1,767
|
Total
|
117,024
|
|
235,503
|
|
497
|
|
134,745
|
|
335,767
|
|
401
|
Revenue from CMP, including both regular CMP and light-Weight
CMP, increased by $1.4 million, or
1.4%, to $96.0 million, and accounted
for 82.0% of total revenue for 2017, compared to $94.6 million, or 70.2% of total revenue for
2016. The Company sold 207,089 tonnes of CMP at an ASP of
$463/tonne in 2017, compared to
278,223 tonnes at an ASP of $340/tonne in 2016.
Of the total CMP sales, revenue from regular CMP increased by
$2.5 million, or 3.2%, to
$80.4 million, resulting from sales
of 173,399 tonnes at an ASP of $464/tonne, for 2017, compared to revenue of
$77.9 million, resulting from sales
of 230,382 tonnes at an ASP of $338/tonne for 2016. Revenue from light-weight
CMP decreased by $1.1 million, or
6.8%, to $15.6 million, resulting
from sales of 33,690 tonnes at an ASP of $463/tonne for 2017, compared to revenue of
$16.7 million, resulting from sales
of 47,841 tonnes at an ASP of $350/tonne for 2016.
Revenue from offset printing paper decreased by $14.7 million, or 44.0%, to $18.7 million for 2017, from $33.4 million for 2016. The Company sold 26,610
tonnes of offset printing paper at an ASP of $702/tonne in 2017, compared to 52,255 tonnes at
an ASP of $639/tonne in 2016.
Revenue from tissue paper products decreased by $3.7 million, or 61.2%, to $2.4 million, for 2017, from $6.1 million for 2016. The Company sold 1,804
tonnes of tissue paper products at an ASP of $1,306/tonne in 2017, compared to 4,917 tonnes at
an ASP of $1,235/tonne in 2016.
We had no revenue from digital photo paper for 2017, compared to
$0.7 million, resulting from sales of
372 tonnes at an ASP of $1,767/tonne,
for 2016. In June 2016, we suspended
the production of digital photo paper due to low market demand for
our products and are now upgrading the production line to produce
more competitive products. We expect to resume our digital photo
paper production in the near future.
Gross Profit and Gross Margin
Total cost of sales decreased by $12.1
million, or 11.1%, to $97.1
million for 2017, from $109.2
million for 2016. This was mainly a result of the
decrease in volume sold, partially offset by increase in cost of
recycled paper board. Cost of sales per tonne was $412 for 2017, compared to $325 for 2016. The increase in overall cost of
sales per tonne was mainly due to higher average unit purchase
costs of recycled paper board, cost of recycled white scrap paper
and additional subsidies created by the Company to the labors
suspending work during the production restriction in September and
October 2017 and partially offset by
the use of natural gas and liquefied gas to replace coal in the
production. Costs of sales per tonne for regular CMP, light-weight
CMP, offset printing paper, tissue paper products, and digital
photo paper were, $385, $375, $581,
$1,222, and $nil, respectively, for
2017, compared to $280, $261, $494,
$1,089, and $2,805, respectively, for 2016.
Total gross profit decreased by $5.6
million, or 21.8%, to $20.0
million for 2017, from $25.5
million for 2016. Overall gross margin decreased by 1.9
percentage points to 17.1% for 2017 from 18.9% for 2016. Gross
margin for regular CMP, light-weight CMP, offset printing paper,
tissue paper products, and digital photo paper was 16.9%, 18.9%,
17.3%, 6.5% and nil, respectively, for 2017, compared to 17.1%,
25.5%, 22.7%, 11.8%, and -58.7%, respectively, for 2016.
Selling, General and Administrative Expenses
Selling, general and administrative expenses ("SG&A")
decreased by $1.1 million, or 8.8%,
to $11.3 million for 2017, from
$12.4 million for 2016. As a
percentage of total revenue, SG&A was 9.7% for 2017, compared
to 9.2% for 2016. The expenses were higher in 2016 because the
Company issued 1,133,916 shares of common stock, valued at
$1,417,395, pursuant to the Company's
compensatory incentive plans in January
2016.
Loss on Impairment of Assets
The Company booked loss on impairment of assets of $2.3 million in 2017, compared to $nil in
2016.
Income from Operations
Income from operations decreased by $8.3
million, or 63.9%, to $4.7
million for 2017 from $13.0
million for 2016. Operating margin was 4.0% for 2017,
compared to 9.6% for 2016.
Net Income (loss)
Net income was $1.7 million, or
$0.08 per basic and diluted share,
for 2017, compared to $7.3 million,
or $0.34 per basic and diluted share,
for 2016.
EBITDA
EBITDA decreased by $8.9 million,
or 31.6%, to $19.4 million for 2017,
from $28.3 million for 2016.
Note 2: Non-GAAP Financial Measures
In addition to our U.S. GAAP results, this press release
includes a discussion of EBITDA, a non-GAAP financial measure as
defined by the Securities and Exchange Commission ("SEC"). The
Company defines EBITDA as net income before interest, income taxes,
depreciation and amortization. EBITDA is a key measure used by
management to evaluate our results and make strategic decisions.
Management believes this measure is useful to investors because it
is an indicator of operational performance. Because not all
companies use identical calculations, the Company's presentation of
EBITDA may not be comparable to similarly titled measures of other
companies, and should not be viewed as an alternative to measures
of financial performance or changes in cash flows calculated in
accordance with the U.S. GAAP.
Reconciliation of
Net Income to EBITDA
|
(Amounts expressed
in US$)
|
|
|
For the
Twelve Months Ended December 31,
|
($
millions)
|
2017
|
|
2016
|
Net
income
|
1.7
|
|
7.3
|
Add: Income
tax
|
0.7
|
|
3.1
|
Net
interest expense
|
2.4
|
|
2.6
|
Depreciation and amortization
|
14.6
|
|
15.3
|
EBITDA
|
19.4
|
|
28.3
|
Cash, Liquidity and Financial Position
As of December 31, 2017, the
Company had cash and cash equivalents, short-term debt (including
related party loan), current capital lease obligations, notes
payable and long-term debt (including related party loans) of
$2.9 million, $7.2 million, $nil, $6.1
million and $11.9 million,
respectively, compared to $2.3
million, $5.1 million,
$8.8 million, $2.2 million and $14.9
million, respectively, at the end of 2016. Net accounts
receivable was $1.8 million as of
December 31, 2017, compared to
$3.9 million as of December 31, 2016. Net inventory was $8.5 million as of December 31, 2017, compared to $5.6 million at the end of 2016. As of
December 31, 2017, the Company had a
net working capital deficit of $1.8
million, compared to $6.1
million at the end of 2016.
Net cash provided by operating activities was $18.2 million for 2017, compared to $15.3 million for 2016. Net cash used in
investing activities was $9.3 million
for 2017, compared to $11.5 million
for 2016. Net cash used by financing activities was $8.6 million for 2017, compared to $3.7 million for 2016.
Recent Development
In late January, 2018, the Company temporarily suspended its
production due to a government-mandated restriction on the natural
gas supply, which is the energy resource we need for production.
Since March 14, 2018, the company has
resumed production at its manufacturing facilities. Therefore, the
Company's revenues in the first quarter ended March 31, 2018 and the year ended December 31, 2018 are expected to be
significantly impacted.
Earnings Conference Call
The Company's management will host a conference call to discuss
its fourth quarter and fiscal year 2017 financial results
at 8:00 am US Eastern Time (5:00
am US Pacific Time/ 8:00 pm
Beijing Time) on Wednesday, April 18, 2018.
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 "Orient Paper Fourth Quarter and
Fiscal Year 2017 Earnings Conference Call."
Conference
Call
|
|
Date:
|
Wednesday, April 18,
2018
|
Time:
|
8:00 am ET (5:00 am
US Pacific Time/ 8:00 pm Beijing Time)
|
International Toll
Free:
|
United States:
+1-855-500-8701
Mainland China:
400-120-0654
Hong Kong:
800-906-606
International:
+65-6713-5440
|
Conference
ID:
|
7662826
|
This conference call will be broadcast live over the Internet,
and can be accessed by all interested parties
at http://www.orientpaperinc.com/ or https://edge.media-server.com/m6/p/z6x2i7e5.
Please access the link at least fifteen minutes prior to the
start of the call to register, download, and install any necessary
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About Orient Paper, Inc.
Orient Paper, Inc. ("Orient Paper") is a leading paper
manufacturer in North China. Using
recycled paper as its primary raw material (with the exception of
its digital photo paper and tissue paper products), Orient Paper
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, Orient Paper 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.
Orient Paper's production facilities are controlled and operated
by its wholly owned subsidiary Shengde Holdings Inc., which in turn
controls and operates Baoding Shengde Paper Co., Ltd., and Hebei
Baoding Orient Paper Milling Co., Ltd.
Founded in 1996, Orient Paper has been listed on the NYSE MKT
under the ticker symbol "ONP" since December
2009. (For more information, please
visit http://www.orientpaperinc.com)
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:
Company Contact:
Orient Paper, Inc.
Email: ir@orientpaperinc.com
Investor Relations:
Tony
Tian,
CFA
Weitian Group LLC
Email: tony.tian@weitian-ir.com
Phone: +1-732-910-9692
ORIENT PAPER,
INC.
|
CONSOLIDATED
BALANCE SHEETS
|
AS OF DECEMBER 31,
2017 AND 2016
|
|
|
|
December
31,
|
|
|
December
31,
|
|
|
2017
|
|
|
2016
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
|
Cash and bank
balances
|
|
$
|
2,895,790
|
|
|
$
|
2,332,646
|
Restricted
cash
|
|
|
6,121,637
|
|
|
|
2,162,318
|
Accounts receivable
(net of allowance for doubtful accounts of $37,626 and $79,478
as of December 31, 2017 and 2016, respectively)
|
|
|
1,843,682
|
|
|
|
3,894,436
|
Inventories
|
|
|
8,474,165
|
|
|
|
5,632,030
|
Prepayments and other
current assets
|
|
|
651,523
|
|
|
|
455,892
|
|
|
|
|
|
|
|
|
Total current
assets
|
|
|
19,986,797
|
|
|
|
14,477,322
|
|
|
|
|
|
|
|
|
Property, plant, and
equipment, net
|
|
|
189,388,709
|
|
|
|
187,689,880
|
Value-added tax
recoverable
|
|
|
3,041,416
|
|
|
|
2,945,575
|
Deferred tax asset
non-current
|
|
|
6,572,559
|
|
|
|
3,264,841
|
|
|
|
|
|
|
|
|
Total
Assets
|
|
$
|
218,989,481
|
|
|
$
|
208,377,618
|
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
|
Short-term bank
loans
|
|
$
|
7,192,923
|
|
|
$
|
5,045,409
|
Current portion of
long-term loans from credit union
|
|
|
6,366,502
|
|
|
|
-
|
Current obligations
under capital lease
|
|
|
-
|
|
|
|
8,786,528
|
Accounts
payable
|
|
|
422,705
|
|
|
|
559,952
|
Advance from
customers
|
|
|
-
|
|
|
|
28,831
|
Notes
payable
|
|
|
6,121,637
|
|
|
|
2,162,318
|
Due to a related
party
|
|
|
60,378
|
|
|
|
56,872
|
Accrued payroll and
employee benefits
|
|
|
231,247
|
|
|
|
209,936
|
Other payables and
accrued liabilities
|
|
|
836,337
|
|
|
|
2,424,778
|
Income taxes
payable
|
|
|
525,804
|
|
|
|
1,310,967
|
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
|
21,757,533
|
|
|
|
20,585,591
|
|
|
|
|
|
|
|
|
Loans from credit
union
|
|
|
1,193,719
|
|
|
|
4,843,592
|
Loans from a related
party
|
|
|
10,712,865
|
|
|
|
10,090,817
|
Deferred gain on
sale-leaseback
|
|
|
-
|
|
|
|
102,232
|
|
|
|
|
|
|
|
|
Total liabilities
(including amounts of the consolidated VIE without recourse to
the
Company of $31,235,520 and $35,618,995 as of December 31, 2017 and
2016,
respectively)
|
|
|
33,664,117
|
|
|
|
35,622,232
|
|
|
|
|
|
|
|
|
Commitments and
Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity
|
|
|
|
|
|
|
|
Common stock,
500,000,000 shares authorized, $0.001 par value per share,
21,450,316 shares issuedand outstanding as of December 31, 2017 and
2016,
respectively
|
|
|
21,450
|
|
|
|
21,450
|
Additional paid-in
capital
|
|
|
50,635,243
|
|
|
|
50,635,243
|
Statutory earnings
reserve
|
|
|
6,080,574
|
|
|
|
6,080,574
|
Accumulated other
comprehensive income (loss)
|
|
|
5,468,799
|
|
|
|
(5,441,391)
|
Retained
earnings
|
|
|
123,119,298
|
|
|
|
121,459,510
|
|
|
|
|
|
|
|
|
Total
stockholders' equity
|
|
|
185,325,364
|
|
|
|
172,755,386
|
|
|
|
|
|
|
|
|
Total Liabilities
and Stockholders' Equity
|
|
$
|
218,989,481
|
|
|
$
|
208,377,618
|
ORIENT PAPER,
INC.
|
CONSOLIDATED
STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (LOSS)
|
FOR THE YEARS
ENDED DECEMBER 31, 2017 AND 2016
|
|
|
Year
Ended
|
|
December
31,
|
|
2017
|
|
|
2016
|
|
|
|
|
|
|
|
Revenues
|
$
|
117,023,578
|
|
|
$
|
134,744,600
|
|
|
|
|
|
|
|
Cost of
sales
|
|
(97,067,627)
|
|
|
|
(109,212,717)
|
|
|
|
|
|
|
|
Gross
Profit
|
|
19,955,951
|
|
|
|
25,531,883
|
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
(11,307,395)
|
|
|
|
(12,401,858)
|
Loss on impairment of
assets
|
|
(2,291,027)
|
|
|
|
-
|
Loss from disposal of
property, plant and equipment
|
|
(1,677,262)
|
|
|
|
(178,306)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
Operations
|
|
4,680,267
|
|
|
|
12,951,719
|
|
|
|
|
|
|
|
Other Income
(Expense):
|
|
|
|
|
|
|
Interest
income
|
|
34,590
|
|
|
|
96,976
|
Subsidy
income
|
|
41,529
|
|
|
|
-
|
Interest
expense
|
|
(2,433,770)
|
|
|
|
(2,621,147)
|
|
|
|
|
|
|
|
Income before
Income Taxes
|
|
2,322,616
|
|
|
|
10,427,548
|
|
|
|
|
|
|
|
Provision for
Income Taxes
|
|
(662,828)
|
|
|
|
(3,114,572)
|
|
|
|
|
|
|
|
Net
Income
|
|
1,659,788
|
|
|
|
7,312,976
|
|
|
|
|
|
|
|
Other
Comprehensive Income (Loss)
|
|
|
|
|
|
|
Foreign currency
translation adjustment
|
|
10,910,190
|
|
|
|
(11,784,410)
|
|
|
|
|
|
|
|
Total
Comprehensive Income (Loss)
|
$
|
12,569,978
|
|
|
$
|
(4,471,434)
|
|
|
|
|
|
|
|
Earnings Per
Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and Diluted
Earnings per Share
|
$
|
0.08
|
|
|
$
|
0.34
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Outstanding –
Basic and Diluted
|
|
21,450,316
|
|
|
|
21,416,143
|
ORIENT PAPER,
INC.
|
CONSOLIDATED
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
|
FOR THE YEARS
ENDED DECEMBER 31, 2017 AND 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional
|
|
|
Statutory
|
|
|
Other
|
|
|
|
|
|
|
|
|
Common Stock
|
|
|
Paid-in
|
|
|
Earnings
|
|
|
Comprehensive
|
|
|
Retained
|
|
|
|
|
|
Shares
|
|
|
Amount
|
|
|
Capital
|
|
|
Reserve
|
|
|
Income
(loss)
|
|
|
Earnings
|
|
|
Total
|
Net income for the
year of 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,312,976
|
|
|
|
7,312,976
|
Balance at December
31, 2016
|
|
|
21,450,316
|
|
|
$
|
21,450
|
|
|
$
|
50,635,243
|
|
|
$
|
6,080,574
|
|
|
$
|
(5,441,391)
|
|
|
$
|
121,459,510
|
|
|
$
|
172,755,386
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,910,190
|
|
|
|
|
|
|
|
10,910,190
|
Net income for the
year of 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,659,788
|
|
|
|
1,659,788
|
Balance at December
31, 2017
|
|
|
21,450,316
|
|
|
$
|
21,450
|
|
|
$
|
50,635,243
|
|
|
$
|
6,080,574
|
|
|
$
|
5,468,799
|
|
|
$
|
123,119,298
|
|
|
$
|
185,325,364
|
ORIENT PAPER,
INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
FOR THE YEARS
ENDED DECEMBER 31, 2017 AND 2016
|
|
|
|
Year
Ended
|
|
|
December
31,
|
|
|
2017
|
|
|
2016
|
|
|
|
|
|
|
|
|
Cash Flows from
Operating Activities:
|
|
|
|
|
|
|
|
Net income
|
|
$
|
1,659,788
|
|
|
$
|
7,312,976
|
Adjustments to
reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
14,633,780
|
|
|
|
15,287,509
|
Loss from impairment
and disposal of property, plant and
equipment
|
|
|
3,968,289
|
|
|
|
178,306
|
(Recovery from)
Allowance for bad debts
|
|
|
(45,309)
|
|
|
|
44,938
|
Share-based
compensation expenses
|
|
|
-
|
|
|
|
1,417,395
|
Deferred
tax
|
|
|
(3,010,577)
|
|
|
|
(1,959,494)
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
2,265,428
|
|
|
|
(2,246,882)
|
Prepayments and other
current assets
|
|
|
(79,264)
|
|
|
|
1,410,080
|
Inventories
|
|
|
(2,417,942)
|
|
|
|
3,112,465
|
Accounts
payable
|
|
|
(166,464)
|
|
|
|
336,507
|
Advance from
customers
|
|
|
(29,663)
|
|
|
|
26,173
|
Notes
payable
|
|
|
3,707,933
|
|
|
|
(11,273,279)
|
Due to a related
party
|
|
|
-
|
|
|
|
(300,621)
|
Accrued payroll and
employee benefits
|
|
|
8,111
|
|
|
|
(300,275)
|
Other payables and
accrued liabilities
|
|
|
(1,503,275)
|
|
|
|
1,509,196
|
Income taxes
payable
|
|
|
(839,047)
|
|
|
|
722,528
|
Net Cash Provided
by Operating Activities
|
|
|
18,151,788
|
|
|
|
15,277,522
|
|
|
|
|
|
|
|
|
Cash Flows from
Investing Activities:
|
|
|
|
|
|
|
|
Purchases of
property, plant and equipment
|
|
|
(9,380,702)
|
|
|
|
(11,586,214)
|
Proceeds from sale of
property, plant and equipment
|
|
|
59,066
|
|
|
|
41,185
|
|
|
|
|
|
|
|
|
Net Cash Used in
Investing Activities
|
|
|
(9,321,636)
|
|
|
|
(11,545,029)
|
|
|
|
|
|
|
|
|
Cash Flows from
Financing Activities:
|
|
|
|
|
|
|
|
Proceeds from related
party loans
|
|
|
-
|
|
|
|
3,020,208
|
Repayments of related
party loans
|
|
|
-
|
|
|
|
(6,026,416)
|
Proceeds from short
term bank loans
|
|
|
12,903,609
|
|
|
|
6,463,347
|
Proceeds from credit
union loans
|
|
|
2,373,077
|
|
|
|
-
|
Repayment of bank
loans
|
|
|
(11,153,463)
|
|
|
|
(14,730,418)
|
Payment of capital
lease obligation
|
|
|
(9,040,260)
|
|
|
|
(675,139)
|
(Increase in) Release
of restricted cash
|
|
|
(3,707,933)
|
|
|
|
8,267,072
|
|
|
|
|
|
|
|
|
Net Cash Used in
Financing Activities
|
|
|
(8,624,970)
|
|
|
|
(3,681,346)
|
|
|
|
|
|
|
|
|
Effect of Exchange
Rate Changes on Cash and Cash
Equivalents
|
|
|
357,962
|
|
|
|
(360,418)
|
|
|
|
|
|
|
|
|
Net Increase
(Derease) in Cash and Cash Equivalents
|
|
|
563,144
|
|
|
|
(309,271)
|
|
|
|
|
|
|
|
|
Cash and Cash
Equivalents - Beginning of Year
|
|
|
2,332,646
|
|
|
|
2,641,917
|
|
|
|
|
|
|
|
|
Cash and Cash
Equivalents - End of Year
|
|
$
|
2,895,790
|
|
|
$
|
2,332,646
|
|
|
|
|
|
|
|
|
Supplemental
Disclosure of Cash Flow Information:
|
|
|
|
|
|
|
|
Cash paid for
interest, net of capitalized interest cost
|
|
$
|
2,103,340
|
|
|
$
|
2,414,458
|
Cash paid for income
taxes
|
|
$
|
4,512,453
|
|
|
$
|
4,351,538
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and bank
balances
|
|
|
2,895,790
|
|
|
|
2,332,646
|
Restricted
cash
|
|
|
6,121,637
|
|
|
|
2,162,318
|
Total cash, cash
equivalents and restricted cash shown in
the statement of cash flows
|
|
|
9,017,427
|
|
|
|
4,494,964
|
View original
content:http://www.prnewswire.com/news-releases/orient-paper-inc-announces-fourth-quarter-and-fiscal-year-2017-financial-results-300631851.html
SOURCE Orient Paper, Inc.