ZHENGZHOU, China and
TAIPEI, Taiwan, Aug. 15, 2014
/PRNewswire/ -- China United Insurance Service, Inc. (CUIS)
(OTCBB: CUII), a leading insurance intermediary company with
operations in the People's Republic of
China, Hong Kong and
Taiwan, on August 11th, 2014 reported financial
results for the three-month and six-months ended June 30, 2014.
2014 Second Quarter Results
Revenues for the quarter ended June 30,
2014 increased 24.7% to $12.3
million, from $9.9 million in
the same period last year. The increase was related, in part, to
$1.2 million in persistency awards
received from two principal insurance companies in which CUIS acts
as an agent in Taiwan, as well as
increased sales through the Company's strategic alliance with AIA
International Limited Taiwan Branch ("AIATW"). Beginning in 2014,
persistency award payments were instituted on a quarterly basis.
There was no persistency awards received in the second quarter of
2013.
Revenues by geography were as follows:
|
|
Three months ended
June 30,
|
Geographical
Area
|
|
2014
|
|
2013
|
PRC
|
|
$
674,160
|
|
$
627,855
|
Taiwan
|
|
11,658,982
|
|
9,262,806
|
|
|
$ 12,333,142
|
|
$ 9,890,661
|
|
|
|
|
|
Cost of revenue for the second quarter of 2014 increased 33.0%
to $8.3 million, compared with
$6.3 million for the same period a
year ago. The increase was primarily due to the grant of several
kinds of bonuses and awards to sub-agents in Taiwan. In 2013, such bonuses and awards were
granted in the quarter ended September 30,
2013.
Gross profit for the quarter was $4.0
million versus $3.6 million
for the comparable quarter in 2013. Operating expenses for the 2014
second quarter were $3.3 million,
compared with $2.8 million in the
same quarter a year ago.
Income before income taxes for the second quarter of 2014 was
$722,000, compared with $970,000 for the same quarter of 2013. Income tax
expense for the quarter was $941,000,
versus $240,000 in the comparable
quarter last year. The increase was due to an income tax law in
Taiwan which provides that a
company is taxed at an additional 10% on any undistributed earnings
to its shareholders. In June 2014,
CUIS elected not to distribute its earnings accumulated as of
December 31, 2013 in lieu of
investing in future growth, which resulted in approximately
$619,000 in additional income
tax.
Net loss for the quarter ended June 30,
2014 was $219,000, compared
with net income of $729,000 for the
same quarter last year. Net loss attributable to CUIS' shareholders
for the quarter was $316,000, or
$0.01 per share, versus net income of
$318,000, or $0.01 per diluted share, in the same period of
2013.
"Strategic alliances with AIATW, along with our sales and
marketing efforts in Taiwan,
propelled our top line growth in the quarter," said Yi Hsiao Mao, Chairman and Chief Executive
Officer. "We are also optimistic about our opportunity to expand in
China, and are pleased that that
our former Chief Executive Officer, Chung-Mei Lo, will be now heading up our
China operations.
"With a strong balance sheet, we are well capitalized to achieve
our growth objectives, recruiting motivated insurance agents,
improving service quality, investing in educating agents, and
evaluating M&A opportunities," Mao added.
Six Month 2014 Financial Results
Revenues for the first six months of 2014 were $21.2 million, compared with $21.5 million a year ago. Persistency awards
received for the first six months of 2014 were $1.8 million versus $2.4
million received in the first quarter of 2013.
Revenues by geography were as follows:
|
|
Six months ended June
30,
|
Geographical
Area
|
|
2014
|
|
2013
|
PRC
|
|
$ 1,389,357
|
|
$ 1,232,272
|
Taiwan
|
|
19,805,508
|
|
20,235,192
|
|
|
$ 21,194,865
|
|
$ 21,467,464
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of the revenue for the first half of 2014 was $13.7 million, compared with $11.5 million for the same period a year ago.
Gross profit for first half of 2014 was $7.5 million versus $9.9
million for the comparable period in 2013. Operating
expenses for the first six months of 2014 were $6.1 million, compared with $5.2 million in the same period last year. The
increase was primarily due to larger general and administrative
expenses, including relocation of the Company's headquarters,
higher salary and benefits, and professional service fees.
Income before income taxes for the six months ended June 30, 2014 was $1.6
million, compared with $5.1
million in the same period 2013. Income tax expense for the
first half of 2014 was $1.2 million,
versus $788,000 in the comparable
period last year.
Net income for the six months ended June
30, 2014 was $432,000,
compared with $4.3 million in the
same period last year. Net loss attributable to CUIS' shareholders
for the six months was $121,000, or
$0.004 per share, versus net income
of $2.7 million, or $0.09 per diluted share, in the same period
2013.
About China United Insurance Service, Inc.
China
United Insurance Service, Inc. was founded in 2010 with a vision to
build one of the largest financial insurance service platforms in
Asia and to become a multinational
enterprise by leveraging the experience of its Taiwan operations and capitalizing on
China's fast-growing insurance
market. CUIS offers a broad range of products and services for
individuals, families, and businesses, including: brokerage
services for various types of life, health, personal accident,
property and casualty insurance; insurance application assistance;
claims advocacy; claims accounting preparation services; disaster
and loss prevention; and risk assessment/risk management consulting
services and the corresponding reinsurance brokerage services. In
2012, the company consolidated both Taiwan and China's operations. CUIS has assembled an
experienced executive team, with more than 81 well-experienced
managers in agency management to guide its more than 4,200
knowledgeable and professional agents. On April 23, 2014, CUIS invested Prime Financial
Asia Ltd ("PFAL") which is a re-insurance company resided in
Hong Kong. Upon the investment,
CUIS would own 51% of PFAL's equity interest. The transaction was
completed on April 30, 2014.
By offering innovative products, continuously improving the
management system and selecting the best products to meet clients'
needs, CUIS aspires to become one of Asia's leading financial insurance
enterprises. For more information on CUIS, please visit:
http://cuis.asia/
Forward Looking Statement
Statements in this press
release may be "forward-looking statements" within the meaning of
the U.S. Private Securities Litigation Reform Act of 1995. Forward-
looking statements can be identified by terminology such as "will,"
"expects," "believes," "anticipates," "intends," "estimates" and
similar statements, and involve known and unknown risks and
uncertainties and are based on current expectations, assumptions,
estimates and projections of CUIS and the insurance industry.
Potential risks and uncertainties include, but are not limited to,
those relating to CUIS' ability to attract and retain productive
agents, its ability to maintain existing and develop new business
relationships with insurance companies, its ability to execute its
growth strategy, its ability to adapt to the evolving regulatory
environment in the Chinese insurance industry, its ability to
compete effectively against its competitors, and macroeconomic
conditions in China and
Taiwan and the potential impact on
the sales of insurance products. These statements are not
guarantees of future performance and involve risks, uncertainties
and assumptions that are difficult to predict. Therefore,
actual outcomes and results may, and probably will, differ
materially from what is expressed or forecasted in such
forward-looking statements due to numerous factors, including those
described above and those risks discussed from time to time in the
company's filings with the Securities and Exchange Commission.
(Financial statements follow)
CHINA
UNITED INSURANCE SERVICE, INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF INCOME AND OTHER COMPREHENSIVE
INCOME/(LOSS)
FOR THE
THREE-MONTHS AND SIX-MONTHS ENDED JUNE 30, 2014 AND
2013
(Unaudited)
|
|
|
|
|
|
Three-Months
Ended
June
30,
|
|
Six-Months
Ended
June
30,
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Revenues
|
$ 12,333,142
|
|
$ 9,890,661
|
|
$ 21,194,865
|
|
$ 21,467,464
|
Cost of
revenue
|
8,330,341
|
|
6,261,417
|
|
13,698,566
|
|
11,536,446
|
Gross
profit
|
4,002,801
|
|
3,629,244
|
|
7,496,299
|
|
9,931,018
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Selling
|
437,677
|
|
457,576
|
|
740,666
|
|
726,387
|
General and
administrative
|
2,906,328
|
|
2,348,538
|
|
5,319,573
|
|
4,438,219
|
Total operating
expenses
|
3,344,005
|
|
2,806,114
|
|
6,060,239
|
|
5,164,606
|
|
|
|
|
|
|
|
|
Other
income:
|
|
|
|
|
|
|
|
Interest
income
|
50,369
|
|
22,352
|
|
93,953
|
|
48,065
|
Other-net
|
12,957
|
|
124,409
|
|
85,901
|
|
266,516
|
Total other
income
|
63,326
|
|
146,761
|
|
179,854
|
|
314,581
|
|
|
|
|
|
|
|
|
Income before
income taxes
|
722,122
|
|
969,891
|
|
1,615,914
|
|
5,080,993
|
Income tax
expense
|
940,755
|
|
240,444
|
|
1,184,355
|
|
788,259
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
(218,633)
|
|
729,447
|
|
431,559
|
|
4,292,734
|
Net income
attributable to the noncontrolling interests
|
(157,602)
|
|
(380,109)
|
|
(552,396)
|
|
(1,597,208)
|
Net income (loss)
attributable to parent's
shareholders
|
(376,235)
|
|
349,338
|
|
(120,837)
|
|
2,695,526
|
|
|
|
|
|
|
|
|
Other comprehensive
items
|
|
|
|
|
|
|
|
Foreign
currency translation gain (loss)
|
60,081
|
|
(31,812)
|
|
(36,929)
|
|
(54,718)
|
Other
comprehensive income (loss)
|
-
|
|
384
|
|
-
|
|
(175)
|
Attributable to parent's shareholders
|
60,081
|
|
(31,428)
|
|
(36,929)
|
|
(54,893)
|
Other
comprehensive items attributable to
noncontrolling interest
|
(113,873)
|
|
(21,512)
|
|
(33,471)
|
|
1,432
|
|
|
|
|
|
|
|
|
Comprehensive income
(loss) attributable to parent's
shareholders
|
$ (316,154)
|
|
$ 317,910
|
|
$ (157,766)
|
|
$ 2,640,633
|
|
|
|
|
|
|
|
|
Comprehensive income
(loss) attributable to
noncontrolling interest
|
$ (271,475)
|
|
$ (401,621)
|
|
$ (585,867)
|
|
$ (1,595,776)
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding:
|
|
|
|
|
|
|
|
Basic and
diluted
|
29,100,503
|
|
29,100,503
|
|
29,100,503
|
|
29,100,503
|
|
|
|
|
|
|
|
|
Income (loss) per
share:
|
|
|
|
|
|
|
|
Basic and
diluted
|
$
(0.013)
|
|
$
0.012
|
|
$
(0.004)
|
|
$
0.093
|
CHINA UNITED
INSURANCE SERVICE, INC. AND SUBSIDIARIES
CONSOLIDATED
BALANCE SHEETS
AS OF JUNE 30,
2014 AND DECEMBER 31, 2013
|
|
|
|
|
|
|
|
June
30,
2014
|
|
December
31,
2013
|
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$ 21,463,810
|
|
$ 18,070,093
|
Marketable
securities
|
|
2,580,407
|
|
2,563,685
|
Accounts
receivable, net
|
|
4,714,723
|
|
7,282,183
|
Other current
assets
|
|
718,486
|
|
2,329,677
|
Total current
assets
|
|
29,477,426
|
|
30,245,638
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
1,138,052
|
|
1,041,189
|
Intangible
assets
|
|
257,516
|
|
308,267
|
Goodwill
|
|
31,651
|
|
-
|
Long –term
investment
|
|
102,784
|
|
102,295
|
Other
assets
|
|
603,415
|
|
587,303
|
Total
Assets
|
|
$ 31,610,844
|
|
$ 32,284,692
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
Current
liabilities
|
|
|
|
|
Taxes
payable
|
|
$ 931,692
|
|
$ 498,441
|
Unearned
revenue
|
|
1,593,634
|
|
1,586,038
|
Other current
liabilities
|
|
7,641,584
|
|
8,632,305
|
Due to related
parties
|
|
164,065
|
|
154,798
|
Total current
liabilities
|
|
10,330,975
|
|
10,871,582
|
|
|
|
|
|
Long-term
liabilities
|
|
6,374,534
|
|
7,095,062
|
TOTAL
LIABILITIES
|
|
16,705,509
|
|
17,966,644
|
|
|
|
|
|
COMMITMENTS AND
CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY
|
|
|
|
|
Preferred stock, par
value $0.00001, 10,000,000 authorized, 1,000,000
issued and
outstanding
|
10
|
|
10
|
Common stock,
par value $0.00001, 100,000,000 authorized, 29,100,503
issued and
outstanding
|
291
|
|
291
|
Additional paid-in
capital
|
|
4,674,593
|
|
4,674,593
|
Reserves
|
|
247,541
|
|
415,041
|
Accumulated other
comprehensive loss
|
|
(122,817)
|
|
(75,888)
|
Retained
earnings
|
|
3,645,046
|
|
3,598,383
|
Stockholder's equity
attribute to parent's shareholder
|
8,454,664
|
|
8,612,430
|
Noncontrolling
interest
|
|
6,450,671
|
|
5,705,618
|
Total
stockholders' equity
|
|
14,905,335
|
|
14,318,048
|
Total Liabilities
and Stockholders' Equity
|
$ 31,610,844
|
|
$ 32,284,692
|
SOURCE China United Insurance Service, Inc.