ZHEJIANG, China, Aug. 14, 2014 /PRNewswire/ -- SORL Auto Parts,
Inc. (NASDAQ: SORL) ("SORL" or the "Company"), a leading
manufacturer and distributor of automotive brake systems as well as
other key safety-related auto parts in China, announced today its unaudited financial
results for the second quarter of 2014 and the first six months
ended June 30, 2014.
Second Quarter 2014 Financial Highlights
- Sales increased 14.3% year-over-year to a second-quarter record
high of $65.7 million;
- Gross margin was 28.2% in the second quarter of 2014 compared
to 29.3% in the same period of 2013;
- Net Income attributable to stockholders was $4.1 million, or $0.21 per diluted share;
- Cash and cash equivalents were $27.0
million with a current ratio of 3.79 to 1 at June 30, 2014;
- Annual guidance was reiterated for sales of $225 million and net income of $12.5 million.
Mr. Xiaoping Zhang, SORL's Chief
Executive Officer and Chairman, stated, "We are pleased to report
an outstanding quarter with the highest sales for any second
quarter in our history. We believe customers in all three of our
business segments - OEM, aftermarket and international – recognized
the superior value of our products through higher purchases."
"Our investment in new products is having a positive result, as
our growing portfolio of advanced innovative products is expanding
the vehicle models we supply. In June and July of 2014, we began
shipping our new braking products to two new models of commercial
vehicles - Sichuan Hyundai Motor Company's Chuanghu brand premium
heavy-duty truck, and Shaanxi Automotive Group's new model M3000
heavy-duty vehicles. These new orders further acknowledge the high
performance and reliability of SORL's advanced safety-related
braking products. As the technological and performance standards
increase, the barriers to entry in the commercial braking market
grow higher."
"We continue to position ourselves in markets where the Chinese
government's policies and spending increases demand for commercial
vehicles such as the ongoing expansion of highways and railways, as
well as other infrastructure projects. Our goal is to become a
leader in each sector by leveraging our products and technologies
to penetrate deeper in each market. Government programs also
continue to support urban and regional public transportation. We
are benefitting from expanded bus service, and advanced emission
standards that require new buses to improve air quality in
China's many cities. We continue
to seek opportunities in adjacent markets where our products or
technologies can be applied."
Ms. Jinrui Yu, SORL's Chief
Operating Officer, commented, "We are committed to provide our
customers with products that strengthen their competitiveness
through advanced technologies, high quality and low cost. We have
enhanced our research and development with new technologies to
supply a steady stream of state-of-the-art products. Our large
product portfolio provides a competitive advantage especially in
the Chinese aftermarket, to expand our market share. Advanced
production equipment has improved product quality, controlled unit
costs and combined with our new products, maintained
our industry-leading gross margin. We remain focusing on capturing
market share in our domestic market as we build our international
operations."
Second Quarter 2014 Financial Performance
For the second quarter of 2014, net sales increased by 14.3% to
$65.7 million from $57.5 million for the second quarter of 2013.
SORL's commercial vehicle brake sales rose in each market segment
in the second quarter of 2014 compared with the second quarter in
2013. Revenues from the Company's domestic OEM customers increased
by 4.2% to $31.9 million from
$30.6 million in the second quarter
of 2013, and increased from $28.6
million in the first quarter of 2014. Sales from
China's domestic aftermarket rose
20.3% to $15.4 million in the second
quarter of 2014 from $12.8 million in
the same quarter of 2013, and increased from $10.5 million in the first quarter of 2014.
Revenues from international markets increased 30.5% to $18.4 million, compared to $14.1 million in the second quarter of 2013, and
substantially improved from the $10.9
million in export sales in the first quarter of 2014.
SORL's commercial vehicle brake sales represented 82.0% of total
sales and increased by 14.9% in the second quarter of 2014 to
$53.9 million, compared with the
second quarter in 2013. This sales growth improved SORL's leading
market share in China as unit
sales in the truck market declined by 14.4% in the 2014 second
quarter. SORL's high-quality, low-cost products continued to
generate higher sales and further penetrated the commercial vehicle
market. The Company's passenger vehicle brake sales increased by
11.3% to $11.8 million in the second
quarter of 2014, compared with the passenger vehicle brake sales in
the second quarter last year.
The gross profit for the second quarter of 2014 increased 10.1%
to $18.5 million from $16.8 million for the second quarter of 2013.
Gross margin for the second quarter of 2014 was 28.2%, compared
with a gross margin of 29.3% in the same quarter of 2013.
Operating expenses increased to $13.4
million in the second quarter of 2014 from $11.7 million in the second quarter of 2013. The
increase in operating expenses in the second quarter of 2014
reflected higher selling and distribution expenditures as more
units were shipped, packaging expenses increased, and research and
development costs rose. As a percentage of revenue, operating
expenses were 20.4% in the second quarter of 2014, compared with
20.4% in the second quarter of 2013, and compared with 23.0% in the
first quarter of 2014.
- Selling and distribution expenses were $6.5 million, or 9.8% of quarterly revenues,
compared with $4.9 million, or 8.5%
in the same quarter of 2013. Higher expenses were primarily due to
higher packaging and freight expenses during the quarter.
- General and administrative ("G&A") expenses in the second
quarter of 2014 were $4.7 million, or
7.2% of revenue, compared with $5.2
million, or 9.1% in the second quarter of 2013. The decrease
in expenses was mainly due to the decrease in allowance for
doubtful accounts. In the second fiscal quarter of 2014, as
compared to the same period in 2013, our allowance for doubtful
accounts decreased, because we had less overdue account
receivables.
- Research and development ("R&D") expenses were $2.2 million in the second quarter of 2014
compared with $1.6 million in the
same quarter of 2013. As a percentage of revenue, R&D was 3.3%
in the second quarter of 2014 and compared with 2.8% of revenue in
the second quarter of 2013. The R&D program continues to mainly
focus on the development of new, higher-margin, electronically
controlled mechatronic products and to upgrade the Company's
traditional brake products to capture market share.
Financial expenses were $479,058
in the second quarter of 2014 compared with $492,094 in the second quarter of 2013 primarily
due to reduced interest expense related to bank loans, and
discounted bank and trade acceptance notes.
Income before provision for income taxes was $5.2 million for the second quarter of 2014
compared to $5.1 million for the
second quarter of 2013. The slightly higher income reflected lower
financial expenses and increased other income during the second
quarter of 2014 compared with the same quarter of 2013. The pretax
income margin was 8.0% in the second quarter of 2014, compared with
8.8% in the second quarter of 2013.
The provision for income taxes was $0.7
million, or a 12.4% tax rate, in the second quarter of 2014,
which is compared with $0.5 million,
or a 10.6% tax rate, in the second quarter in 2013. The increase
was mainly due to increased pre-tax income.
Net income attributable to stockholders for the second quarter
of 2014 was $4.1 million, or
$0.21 per basic and diluted share,
compared with $4.0 million, or
$0.21 on per basic and diluted share,
in the second quarter of 2013.
First Six Months 2014 Financial Performance
Net sales for the first six months of 2014 increased 17.1% to
$115.7 million from $98.8 million for the first six months of 2013.
Revenues from the Company's China OEM customers increased 13.3% to
$60.5 million from $53.4 million in the same period in 2013.
Revenues from China's domestic
aftermarket increased 17.7% to $25.9
million from $22.0 million in
the first six months of 2013. Revenues from international markets
increased 25.2% to $29.3 million from
$23.4 million in the first six months
of 2013.
Gross profit for the first six months of 2014 increased 16.7% to
$33.9 million from $29.0 million in for the same period in 2013.
Gross margin for the six months ended June
30, 2014, decreased to 29.4% from 29.5% for the first six
months of 2013.
Operating income for the first six months of 2014 increased to
$9.9 million from $8.2 million in the same period in 2013.
Operating margin was 8.6% versus 8.3% in first six months of 2013.
Net income attributable to stockholders for the first six months
of 2014 was $6.9 million, or
$0.36 per basic and diluted share,
compared with $5.3 million, or
$0.27 per basic and diluted share, in
the same period in 2013.
Balance Sheet
As of June 30, 2014, the Company
had cash and cash equivalents of $27.0
million compared to $28.2
million on December 31, 2013.
Total equity increased to $211.5
million at June 30, 2014
compared with $199.5 million at
December 31, 2013. On June 30, 2014, working capital was $155.5 million with a current ratio of 3.8 to
1.
Recent Events
In July 2014, SORL entered into an
agreement to supply its braking products to Sichuan Hyundai Motor
("SHMC") Company for its Chuanghu brand premium heavy-duty truck.
SHMC is a joint venture owned equally by Ziyang Nanjun Automobile
Co., Ltd. and Hyundai Motor Group in South Korea.
In June 2014, SORL began supplying
its three-pedal braking system to the new model M3000 heavy-duty
vehicles produced by the Shaanxi Automotive Group.
Business Outlook
For the fiscal year 2014, management expected the sales to be
approximately $225.0 million and net
income to be approximately $12.5
million. These targets are based on the Company's current
views on the operating and market conditions, which are subject to
change.
Conference Call
Management will host a conference call on Friday, August 15, 2014 at 8:00 a.m. EDT / 8:00
p.m. Beijing Time to discuss its 2014 second quarter and six
month financial results. Listeners may access the call by dialing
U.S. toll free number +1-877-407-0778, +1-201-689-8565 for
international callers, and China
toll free 864 001 202 840. A live web cast of the conference call
will also be available at http://www.sorl.cn.
A replay of the call will be available shortly after the
conference call through 11:59 p.m.
EDT on September 15, 2014, or
12:59 a.m. Beijing Time on
September 16, 2014. The replay
dial-in numbers are: U.S. toll free number +1-877-660-6853,
or the international number is +1-201-612-7415; using Conference ID
"13588326" to access the replay.
About SORL Auto Parts,
Inc.
As a global tier one supplier of brake and control systems to
the commercial vehicle industry, SORL Auto Parts, Inc. is the
market leader for commercial vehicles brake systems, such as trucks
and buses in China. The Company
distributes products both within China and internationally under the SORL
trademark. SORL is listed among the top 100 auto component
suppliers in China, with a product
range that includes 65 categories with over 2000 specifications in
brake systems and others. The Company has four authorized
international sales centers in UAE, India, the United
States and Europe. SORL is
working to establish a broader global sales network. For more
information, please visit http://www.sorl.cn.
Safe Harbor Statement
This press release may include certain statements that are not
descriptions of historical facts, but are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements can be identified by
the use of forward-looking terminology such as "expects,"
"anticipates," "believes," "targets," "goals," "projects,"
"intends," "plans," "seeks," "estimates," "may," "will," "should"
or similar expressions. These forward-looking statements may also
include statements about the Company's proposed discussions related
to its business or growth strategy, which are subject to change.
Such information is based upon expectations of the Company's
management that were reasonable when made, but may prove to be
incorrect. All of such assumptions are inherently subject to
uncertainties and contingencies beyond the Company's control and
upon assumptions with respect to future business decisions, which
are subject to change. The Company does not undertake to update the
forward-looking statements contained in this press release. These
risks and uncertainties may include, but are not limited to general
political, economic and business conditions which may impact the
demand for commercial vehicles or passenger vehicles in
China and the other significant
markets where the Company's products are sold, uncertainty
regarding such political, economic and business conditions, trends
in consumer debt levels and bad debt write-offs, general
uncertainty related to possible recessions, natural disasters, the
political stability of China and
the impact of any of those events on demand for commercial or
passenger vehicles, changes in consumer confidence, new product
development and introduction, competitive products and pricing,
seasonality, availability of alternative sources of supply in the
case of the loss of any significant supplier or any supplier's
inability to fulfill the Company's orders, cost of labor and raw
materials, the loss of or curtailed sales to significant customers,
the Company's dependence on key employees and officers, the ability
to secure and protect trademarks, patents and other intellectual
property rights, potential effects of competition in the Company's
business, the dependency of the Company upon the normal operation
of its sole manufacturing facility, potential effect of the
economic and currency instability in China and countries to which the Company sold
its products, the ability of the Company to successfully manage its
expenses on a continuing basis, the continued availability to the
Company of financing and credit on favorable terms, business
disruptions, disease, general risks associated with doing business
in China or other countries
including, without limitation, foreign trade policies, import
duties, tariffs, quotas, political and economic stability, and the
other factors discussed in the Company's Annual Report on Form 10-K
and other filings with the Securities and Exchange Commission. For
additional information regarding known material factors that could
cause the Company's results to differ from its projected results,
please see its filings with the SEC, including its Annual Report on
Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on
Form 8-K. Copies of filings made with the SEC are available through
the SEC's electronic data gathering analysis retrieval system
(EDGAR) at http://www.sec.gov.
Contact Information
Raymond Lin
+86.139.6777.6556
+86.577.6581.7721
ljf@sorl.com.cn
Phyllis Huang
+86.151.6770.5972
+86.577.6581.7721
phyllis@sorl.com.cn
Kevin Theiss
Grayling
+1.646.284.9409
kevin.theiss@grayling.com
- Tables Follow -
SORL Auto Parts,
Inc. and Subsidiaries
|
Consolidated
Balance Sheets
|
June 30, 2014 and
December 31, 2013
|
|
|
|
|
|
|
|
|
|
|
June 30,
2014
|
|
December 31,
2013
|
|
|
|
|
(Unaudited)
|
|
(Audited)
|
|
|
Assets
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
US$
|
27,020,085
|
US$
|
28,241,983
|
|
|
Accounts receivable,
net of provision
|
|
69,189,724
|
|
57,912,384
|
|
|
Bank acceptance notes
from customers
|
|
23,641,110
|
|
20,186,787
|
|
|
Inventories
|
|
82,450,896
|
|
76,364,019
|
|
|
Prepayments
|
|
4,622,474
|
|
3,773,750
|
|
|
Current portion of
prepaid capital lease interest
|
|
371,777
|
|
453,053
|
|
|
Other current
assets
|
|
2,302,279
|
|
2,537,300
|
|
|
Deferred tax
assets
|
|
1,731,372
|
|
1,392,955
|
|
|
Total
Current Assets
|
|
211,329,717
|
|
190,862,231
|
|
Fixed
Assets
|
|
|
|
|
|
|
Machinery
|
|
49,341,407
|
|
46,475,961
|
|
|
Molds
|
|
1,418,158
|
|
1,388,218
|
|
|
Office
equipments
|
|
2,096,657
|
|
1,960,476
|
|
|
Vehicles
|
|
2,066,179
|
|
2,248,280
|
|
|
Buildings
|
|
9,102,678
|
|
8,910,501
|
|
|
Machinery held under
capital lease
|
|
29,012,601
|
|
28,396,853
|
|
|
Less: accumulated
depreciation
|
|
(48,383,297)
|
|
(44,175,888)
|
|
|
Property, plant and equipment, net
|
|
44,654,383
|
|
45,204,401
|
|
|
Leasehold
improvements in progress
|
|
227,933
|
|
264,612
|
|
|
|
|
|
|
|
|
Land Use Rights,
Net
|
|
14,531,221
|
|
14,409,170
|
|
|
|
|
|
|
|
|
Other Non-Current
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible
assets
|
|
180,104
|
|
176,302
|
|
|
Less: accumulated
amortization
|
|
(136,511)
|
|
(126,031)
|
|
|
Intangible assets,
net
|
|
43,593
|
|
50,271
|
|
|
Security deposits on
lease agreement
|
|
1,857,459
|
|
1,818,244
|
|
|
Non-current portion
of prepaid capital lease interest
|
|
216,238
|
|
371,355
|
|
|
Total Other Non-Current
Assets
|
|
2,117,290
|
|
2,239,870
|
|
|
Total
Assets
|
US$
|
272,860,544
|
US$
|
252,980,284
|
|
|
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
Accounts payable,
including $3,031,309 and $810,310 due to related parties at June
30, 2014 and December 31, 2013, respectively.
|
US$
|
13,267,766
|
US$
|
13,290,282
|
|
|
Deposit received from
customers
|
|
13,737,468
|
|
13,931,658
|
|
|
Short-term bank
loans
|
|
11,116,360
|
|
4,526,863
|
|
|
Income tax
payable
|
|
800,102
|
|
494,658
|
|
|
Accrued
expenses
|
|
11,928,934
|
|
10,066,969
|
|
|
Current portion of
capital lease obligations
|
|
3,714,917
|
|
3,636,488
|
|
|
Other current
liabilities, including $40,570 and $94,246 due to related parties
at June 30, 2014 and December 31, 2013, respectively.
|
|
1,242,209
|
|
256,430
|
|
|
Total
Current Liabilities
|
|
55,807,756
|
|
46,203,348
|
|
|
|
|
|
|
|
|
Non-Current
Liabilities
|
|
|
|
|
|
|
Non-current portion
of capital lease obligations
|
|
5,572,376
|
|
7,272,975
|
|
|
Total
Non-Current Liabilities
|
|
5,572,376
|
|
7,272,975
|
|
|
|
|
|
|
|
|
|
Total
Liabilities
|
US$
|
61,380,132
|
US$
|
53,476,323
|
|
|
|
|
|
|
|
|
Stockholders'
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock - no
par value; 1,000,000 authorized; none issued and outstanding as of
June 30, 2014 and December 31, 2013
|
|
-
|
|
-
|
|
|
Common stock - $0.002
par value; 50,000,000 authorized, 19,304,921 issued
|
|
|
|
|
|
|
and outstanding as
of
|
|
|
|
|
|
|
June 30, 2014 and
December 31, 2013
|
|
38,609
|
|
38,609
|
|
|
Additional paid-in
capital
|
|
42,199,014
|
|
42,199,014
|
|
|
Reserves
|
|
11,315,415
|
|
10,609,435
|
|
|
Accumulated other
comprehensive income
|
|
26,396,341
|
|
22,465,720
|
|
|
Retained
earnings
|
|
110,740,917
|
|
104,544,120
|
|
|
Total SORL Auto
Parts, Inc. stockholders' equity
|
|
190,690,296
|
|
179,856,898
|
|
|
Noncontrolling
Interest In Subsidiaries
|
|
20,790,116
|
|
19,647,063
|
|
|
Total
Equity
|
|
211,480,412
|
|
199,503,961
|
|
|
Total Liabilities
and Stockholders' Equity
|
US$
|
272,860,544
|
US$
|
252,980,284
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SORL Auto Parts,
Inc. and Subsidiaries
Consolidated
Statements of Income and Comprehensive Income
For The Three
Months and Six Months Ended on June 30, 2014 and 2013
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
|
|
|
US$
|
65,723,746
|
US$
|
57,511,004
|
US$
|
115,717,035
|
US$
|
98,829,164
|
Include: sales to
related parties
|
|
|
|
1,345,506
|
|
1,004,391
|
|
1,635,583
|
|
1,242,572
|
Cost of
sales
|
|
|
|
|
47,209,861
|
|
40,688,905
|
|
81,816,214
|
|
69,783,242
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit
|
|
|
|
|
|
18,513,885
|
|
16,822,099
|
|
33,900,821
|
|
29,045,922
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling and
distribution expenses
|
|
|
|
6,473,111
|
|
4,911,344
|
|
12,178,605
|
|
9,319,843
|
General and
administrative expenses
|
|
|
4,710,874
|
|
5,220,131
|
|
9,027,028
|
|
9,383,277
|
Research and
development expenses
|
|
|
|
2,200,558
|
|
1,617,147
|
|
3,691,757
|
|
3,007,611
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
|
|
|
13,384,543
|
|
11,748,622
|
|
24,897,390
|
|
21,710,731
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other operating
income
|
|
|
|
|
549,130
|
|
632,105
|
|
925,262
|
|
835,892
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations
|
|
|
|
|
5,678,472
|
|
5,705,582
|
|
9,928,693
|
|
8,171,083
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income
|
|
|
|
|
213,292
|
|
-
|
|
251,596
|
|
91,353
|
Financial
expenses
|
|
|
|
|
(479,058)
|
|
(492,094)
|
|
(1,138,941)
|
|
(1,438,338)
|
Non-operating
expenses
|
|
|
|
|
(181,401)
|
|
(127,224)
|
|
(233,308)
|
|
(195,301)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before
provision for income taxes
|
|
|
5,231,305
|
|
5,086,264
|
|
8,808,040
|
|
6,628,797
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
|
|
|
651,210
|
|
539,334
|
|
1,164,445
|
|
708,188
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
|
|
US$
|
4,580,095
|
US$
|
4,546,930
|
US$
|
7,643,595
|
US$
|
5,920,609
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to noncontrolling
interest in
subsidiaries
|
447,621
|
|
512,138
|
|
740,818
|
|
652,438
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to common stockholders
|
|
4,132,474
|
|
4,034,792
|
|
6,902,777
|
|
5,268,171
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
|
|
|
4,580,095
|
|
4,546,930
|
|
7,643,595
|
|
5,920,609
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
|
|
(25,135)
|
|
1,150,709
|
|
4,332,856
|
|
3,810,071
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive
income
|
|
|
|
|
4,554,960
|
|
5,697,639
|
|
11,976,451
|
|
9,730,680
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income
attributable to
noncontrolling
interest in subsidiaries
|
445,057
|
|
628,535
|
|
1,143,053
|
|
1,031,926
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income
attributable to
common
shareholders
|
4,109,903
|
|
5,069,104
|
|
10,833,398
|
|
8,698,754
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common share - basic
|
|
|
19,304,921
|
|
19,304,921
|
|
19,304,921
|
|
19,304,921
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
common share - diluted
|
|
|
19,304,921
|
|
19,304,921
|
|
19,304,921
|
|
19,304,921
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EPS -
basic
|
|
|
|
|
US$
|
0.21
|
US$
|
0.21
|
US$
|
0.36
|
US$
|
0.27
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EPS -
diluted
|
|
|
|
US$
|
0.21
|
US$
|
0.21
|
US$
|
0.36
|
US$
|
0.27
|
SORL Auto Parts,
Inc. and Subsidiaries
Consolidated
Statements of Cash Flows
For The Six Months
Ended on June 30, 2014 and 2013 (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30,
|
|
|
|
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
Cash Flows from
Operating Activities
|
|
|
|
|
Net income
|
|
|
|
US$
|
7,643,595
|
US$
|
5,920,609
|
Adjustments to
reconcile net income to net cash
|
|
|
|
|
from operating
activities:
|
|
|
|
|
|
Allowance for
doubtful accounts
|
|
|
1,194,754
|
|
1,634,203
|
Depreciation and
amortization
|
|
|
3,732,381
|
|
3,625,115
|
Deferred income
tax
|
|
|
|
(307,429)
|
|
(233,687)
|
Loss on disposal of
fixed assets
|
|
28,075
|
|
-
|
Changes in Assets
and Liabilities:
|
|
|
|
|
Account
receivable
|
|
|
|
(11,133,975)
|
|
3,762,142
|
Bank acceptance notes
from customers
|
|
(3,098,660)
|
|
(7,323,135)
|
Other currents
assets
|
|
|
|
325,030
|
|
18,266
|
Inventories
|
|
|
|
|
(4,449,536)
|
|
(8,496,818)
|
Prepayments
|
|
|
|
(743,265)
|
|
1,590,962
|
Prepaid capital
lease interest
|
|
252,772
|
|
342,776
|
Accounts payable and
bank acceptance notes to vendors
|
|
(254,762)
|
|
(5,092,453)
|
Income tax
payable
|
|
|
|
296,017
|
|
-
|
Deposits received
from customers
|
|
|
(488,943)
|
|
2,737,611
|
Other current
liabilities and accrued expenses
|
|
2,624,773
|
|
2,513,792
|
Net Cash Flows
Provided By (Used In) Operating Activities
|
|
(4,379,173)
|
|
999,383
|
|
|
|
|
|
|
|
|
Cash Flows from
Investing Activities
|
|
|
|
|
Acquisition of
property and equipment
|
|
(2,061,662)
|
|
(2,219,689)
|
Proceeds of disposal
of fixed assets
|
|
53,437
|
|
-
|
Net Cash Flows
Used In Investing Activities
|
|
(2,008,225)
|
|
(2,219,689)
|
|
|
|
|
|
|
|
|
Cash Flows from
Financing Activities
|
|
|
|
|
Proceeds from bank
loans
|
|
22,292,424
|
|
48,751,425
|
Repayment of bank
loans
|
|
|
(15,904,045)
|
|
(53,812,232)
|
Repayment of capital
lease
|
|
|
(1,847,655)
|
|
(10,473,023)
|
Proceeds from capital
lease
|
|
|
-
|
|
12,783,841
|
|
|
|
|
|
|
|
|
Net Cash flows
Provided By (Used In) Financing Activities
|
|
4,540,724
|
|
(2,749,989)
|
|
|
|
|
|
|
|
|
Effects on changes
in foreign exchange rate
|
|
624,776
|
|
726,068
|
|
|
|
|
|
|
|
|
Net change in cash
and cash equivalents
|
|
(1,221,898)
|
|
(3,244,227)
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents- beginning of the year
|
|
28,241,983
|
|
41,253,353
|
|
|
|
|
|
|
|
|
Cash and cash
Equivalents - End of the period
|
US$
|
27,020,085
|
US$
|
38,009,126
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Cash
Flow Disclosures:
|
|
|
|
|
Interest
paid
|
|
|
|
722,728
|
|
859,771
|
Tax paid
|
|
|
|
US$
|
1,171,310
|
US$
|
972,107
|
SOURCE SORL Auto Parts, Inc.