- Sales to the Chinese OEM market increased by 55.6%
year-over-year and aluminum wheel shipment volume increased by
41.2% in the fourth quarter -
- 2017 revenue grew 25.8% to US$435.1
million -
ZHANGZHOU, China, March 15, 2018 /PRNewswire/ -- China Zenix
Auto International Limited (NYSE: ZX) ("Zenix Auto" or "the
Company"), the largest commercial vehicle wheel manufacturer in
China in both the aftermarket and
OEM market by sales volume, today announced its unaudited financial
results for the fourth quarter and full year ended December 31,
2017.
Financial Highlights
Fourth Quarter 2017:
- Revenue was RMB736.3 million
(US$113.2 million), up 24.4%
year-over-year from RMB591.9 million
in the fourth quarter of 2016;
- Sales to the Chinese OEM market increased by 55.6%
year-over-year to RMB397.9 million
(US$61.2 million) from RMB255.7 million in the fourth quarter of
2016;
- Tubeless steel wheel sales represented 43.2% of fourth quarter
revenue compared to 35.4% in the fourth quarter of 2016;
- Aluminum wheel sales grew 28.1% year-over-year;
- Net profit and total comprehensive income was RMB9.5 million (US$1.5
million) with earnings per American Depositary Share ("ADS")
of RMB0.18 (US$ 0.03) compared with net loss and total
comprehensive loss of RMB11.6 million
with loss per ADS of RMB0.23 in the
fourth quarter of 2016;
- On December 31, 2017, total cash,
cash equivalents and fixed bank deposits with a maturity period
over three months were RMB 1,041.6
million (US$ 160.1
million).
Full Year 2017:
- Revenue was RMB2,831.0 million
(US$435.1 million), up 25.8%
year-over-year from RMB2,249.5
million in 2016;
- Sales to the Chinese OEM market increased by 78.9% to
RMB1,533.0 million (US$235.6 million);
- Net profit and total comprehensive income was RMB9.1 million (US$1.4
million) with earnings per ADS of RMB0.18 (US$0.03)
compared with net loss of RMB25.9
million with loss per ADS of RMB0.50 in 2016.
Mr. Junqiu Gao, Deputy CEO and
Chief Sales and Marketing Officer of Zenix Auto, commented, "We are
pleased to report that we have returned to profitability in 2017 as
we rode the wave of robust OEM truck sales and increased our market
share with leading OEMs. With our growing economy-of-scale, and the
increased adoption of tubeless and aluminum wheels, we are
confident that 2018 will continue to be a solid year for us."
Mr. Martin Cheung, CFO of Zenix
Auto, commented, "As the largest supplier in the commercial vehicle
wheel segment, we continue to implement our product strategy of
introducing advanced wheels and enhancing our leading production
efficiencies. As a result, our operating margin improved in 2017.
We will continue to monitor our cash flow management to strengthen
our balance sheet."
2017 Fourth Quarter Results
Revenue for the fourth quarter ended December 31, 2017 was RMB736.3 million (US$113.2
million) from RMB 591.9
million for the fourth quarter of 2016. The increase in
revenue on a year-over-year basis was mainly driven by increased
demand for new trucks, especially heavy- and medium-duty trucks,
due to the combined effects of the Government's anti-overloading
policy and increased development of infrastructure and residential
properties in China.
Aftermarket sales in China
decreased by 5.2% year-over-year to RMB235.4
million (US$36.2 million) in
the fourth quarter of 2017 from RMB248.4
million in the fourth quarter of 2016. Total unit sales in
the aftermarket decreased by 27.3% year-over-year while prices
increased. The aftermarket wheel segment remained weak as higher
OEM truck sales negatively affected aftermarket replacement
volume.
Sales to the Chinese OEM market increased by 55.6%
year-over-year to RMB397.9 million
(US$61.2 million) in the fourth
quarter of 2017 compared to RMB255.7
million in the same quarter of 2016. Total unit sales in the
OEM market increased by 7.4% year-over-year as a result of
continued truck sales growth, especially heavy- and medium-duty
trucks, during the fourth quarter of 2017.
International sales increased by 17.2% year-over-year to
RMB102.9 million (US$15.8 million) in the fourth quarter of 2017
compared to sales of RMB 87.8 million
in the fourth quarter of 2016. Total unit volume in international
sales decreased by 7.1% year-over-year in the fourth quarter of
2017 as weaker demand in the price sensitive regions such as
Southeast Asia, negatively
affected overall sales.
In the fourth quarter of 2017, domestic aftermarket sales,
domestic OEM sales and international sales contributed 32.0%, 54.0%
and 14.0% of revenue, respectively.
Sales of tubed steel wheels comprised 44.3% of 2017 fourth
quarter revenue compared to 52.4% in the same quarter in 2016.
Tubeless steel wheel sales represented 43.2% of 2017 fourth quarter
revenue compared to 35.4% in the same quarter of 2016. Tubed and
tubeless steel wheel sales remained the main sources of revenue for
the Company. However, sales of aluminum wheels continued to
increase and accounted for 8.1% of fourth quarter revenue as
compared to 7.9% in the same quarter a year ago.
Fourth quarter gross profit increased by 22.1% to RMB108.5 million (US$16.7
million), compared to RMB 88.8
million in the same quarter in 2016. Gross margin was 14.7%,
compared with 15.0% in the fourth quarter of 2016. The decrease in
gross margin on a year-over-year basis was mainly driven by the
significant price appreciation of raw materials, namely steel,
which slightly outpaced Zenix Auto's wheel price increases.
Selling and distribution expenses decreased by 9.4% to
RMB41.1 million (US$6.3 million) from RMB45.4 million in the fourth quarter of 2016. As
a percentage of revenue, selling and distribution costs were
reduced to 5.6% in the fourth quarter of 2017, compared to 7.7% in
the same quarter a year ago.
Research and development ("R&D") expenses decreased by 34.1%
to RMB15.5 million (US$2.4 million), compared to RMB23.5 million in the fourth quarter of 2016.
R&D as a percentage of revenue was 2.1% in the fourth quarter
of 2017, compared to 4.0% in same quarter of 2016.
Administrative expenses remained flat at RMB 34.4 million (US$5.3
million) from RMB34.4 million
in the fourth quarter of 2016. However, as a percentage of revenue,
administrative expenses were 4.7% in the fourth quarter of 2017,
compared to 5.8% of revenue in the fourth quarter of 2016.
Net profit and total comprehensive income for the fourth quarter
of 2017 was RMB9.5 million
(US$1.5 million), compared to net
loss and total comprehensive loss of RMB11.6
million in the same quarter of 2016.
Basic and diluted earnings per ADS in the fourth quarter of 2017
were RMB 0.18 (US$0.03) compared to basic and diluted loss per
ADS of RMB0.23 in the same quarter of
2016.
In the fourth quarter of 2017, the Company recorded net cash
outflows from operating activities of RMB41.8 million (US$6.4
million). Capital expenditures for the purchase of property,
plant and equipment in the fourth quarter were RMB0.4 million (US$0.1
million).
During the fourth quarter of 2017 and 2016, the weighted average
number of ordinary shares was 206.5 million and the weighted
average number of ADSs was 51.6 million.
2017 Full Year Results
Revenue for the year ended December 31,
2017 grew 25.8% to RMB2,831.0
million (US$435.1 million)
compared with RMB2,249.5 million in
2016.
Aftermarket sales decreased by 10.9% to RMB909.9 million (US$139.9
million) in 2017 and represented 32.1% of total revenue.
Sales to the Chinese OEM market increased by 78.9% to RMB1,533.0 million (US$235.6 million) and represented 54.2% of total
revenue. International sales increased by 4.4% to RMB388.0 million (US$ 59.6
million) compared to last year and represented 13.7% of
total revenue.
Tubed steel wheel sales in 2017 accounted for 45.4% of revenue
compared with 54.6% in 2016. Tubeless steel wheel sales accounted
for 43.9% of revenue compared with 36.4% in 2016. With the increase
in market acceptance, aluminum wheel sales accounted for 6.8% of
revenue in 2017 compared with 4.6% in 2016.
Gross profit for year 2017 was RMB381.6
million (US$58.6 million),
compared with RMB 387.5 million in
2016. Gross margin was 13.5% in 2017 as compared to 17.2% in
2016.
Net profit and total comprehensive income for full year 2017 was
RMB9.1 million (US$1.4 million), compared with net loss and total
comprehensive loss of RMB25.9 million
in 2016. Basic and diluted earnings per ADS for the full year ended
December 31, 2017 were RMB0.18 (US$0.03)
as compared to basic and diluted loss per ADS of RMB0.50 in 2016.
As of December 31, 2017, Zenix
Auto had bank balances and cash of RMB751.6
million (US$115.5 million) and
fixed bank deposits with a maturity period over three months of
RMB290.0 million (US$44.6 million). Total equity attributable to
owners of the Company was RMB2,546.6
million (US$391.4
million).
For the year ended December 31,
2017, the Company recorded cash outflows from operating
activities of RMB91.2 million
(US$14.0 million). Capital
expenditures for the purchase of property, plant and equipment were
RMB35.6 million (US$5.5 million).
Conference Call Information
The Company will host a conference call on Thursday, March 15, 2018 at 8:00 a.m. ET/ 8:00
p.m. Beijing Time. Interested parties may participate in the
conference call by dialing +1-877-407-0782 (U.S. Toll Free) or
+1-201-689-8567 (International). Please dial in five minutes before
the call start time and ask to be connected to the "China Zenix
Auto" conference call.
A replay will be available shortly after the conclusion of the
conference call through April 15,
2018, at 8:00 a.m. ET.
Interested parties may access the replay by dialing +1-877-481-4010
(U.S. Toll Free) or +1-919-882-2331 (International) and using
Conference ID 26060 to access the replay.
Exchange Rate Information
The United States dollar (US$)
amounts disclosed in this press release are presented solely for
the convenience of the reader. All translations from RMB to U.S.
dollars are made at a rate of RMB6.5063 to US$1.00, the effective noon buying rate as of
December 31, 2017 in The City of New York, for cable transfers of RMB
as set forth in the H.10 weekly statistical release of the Federal
Reserve Board. The percentages stated are calculated based on RMB
amounts.
About China Zenix Auto International Limited
China Zenix Auto International Limited is the largest commercial
vehicle wheel manufacturer in China in both the aftermarket and OEM market
by sales volume. The Company offers more than 798 series of
aluminum wheels, tubed steel wheels, tubeless steel wheels, and
off-road steel wheels in the aftermarket and OEM markets in
China and internationally. The
Company's customers include large PRC commercial vehicle
manufacturers, and it also exports products to over 80 distributors
in more than 28 countries worldwide. With six large, strategically
located manufacturing facilities in multiple regions across
China, the Company has a designed
annual production capacity of approximately 15.5 million units of
steel and aluminum wheels as of December 31,
2017. For more information, please
visit: www.zenixauto.com/en.
Safe Harbor
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates," "confident" and similar statements. The
Company may make written or oral forward-looking statements in its
periodic reports to the SEC, in its annual report to shareholders,
in press releases and other written materials and in oral
statements made by its officers, directors or employees. Statements
that are not historical facts, including statements about the
Company's beliefs and expectations, are forward-looking statements.
Forward-looking statements involve inherent risks and
uncertainties. A number of factors could cause actual results to
differ materially from those contained in any forward-looking
statement. Further information regarding these risks is included in
our filings with the SEC. The Company does not undertake any
obligation to update any forward-looking statement, except as
required under applicable law. All information provided in this
press release and in the attachments is as of the date of the press
release, and the Company undertakes no duty to update such
information, except as required under applicable law.
For more information, please contact
Kevin Theiss
Awaken Advisors
Tel: +1-(212) 521-4050
Email: Kevin.Theiss@awakenlab.com
- tables follow -
China Zenix Auto
International Limited
|
Unaudited
Condensed Consolidated Statements of Profit or Loss and Other
Comprehensive
Income
|
For the three
months ended December 31, 2017 and 2016
|
(RMB and US$
amounts expressed in thousands, except number of shares and ADSs
and
per share data)
|
|
|
|
|
|
2016
Q4
|
|
2017
Q4
|
|
2017
Q4
|
|
|
RMB'
000
|
|
RMB'
000
|
|
US$'
000
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
591,888
|
|
736,284
|
|
113,165
|
|
Cost of
sales
|
|
(503,068)
|
|
(627,815)
|
|
(96,493)
|
|
Gross
profit
|
|
88,820
|
|
108,469
|
|
16,672
|
|
Other operating
income
|
|
4,978
|
|
2,229
|
|
343
|
|
Net exchange
gain(loss)
|
|
1,602
|
|
(1,181)
|
|
(182)
|
|
Selling and
distribution costs
|
|
(45,432)
|
|
(41,147)
|
|
(6,324)
|
|
Research and
development expenses
|
(23,528)
|
|
(15,503)
|
|
(2,383)
|
|
Administrative
expenses
|
|
(34,423)
|
|
(34,434)
|
|
(5,292)
|
|
Finance
costs
|
|
(5,344)
|
|
(5,423)
|
|
(833)
|
|
(Loss) Profit before
taxation
|
|
(13,327)
|
|
13,010
|
|
2,000
|
|
Income tax credit
(expense)
|
|
1,700
|
|
(3,513)
|
|
(540)
|
|
|
|
|
|
|
|
|
|
(Loss) Profit and
total
comprehensive income for the
period
|
|
(11,627)
|
|
9,497
|
|
1,460
|
|
|
|
|
|
|
|
|
|
(Loss) Earnings per
share
|
|
|
|
|
|
|
|
Basic
|
|
(0.06)
|
|
0.05
|
|
0.01
|
|
Diluted
|
|
(0.06)
|
|
0.05
|
|
0.01
|
|
|
|
|
|
|
|
|
|
(Loss) Earnings per
ADS
|
|
|
|
|
|
|
|
Basic
|
|
(0.23)
|
|
0.18
|
|
0.03
|
|
Diluted
|
|
(0.23)
|
|
0.18
|
|
0.03
|
|
|
|
|
|
|
|
|
|
Shares
|
|
206,500,000
|
|
206,500,000
|
|
206,500,000
|
|
ADSs
|
|
51,625,000
|
|
51,625,000
|
|
51,625,000
|
|
China Zenix Auto
International Limited
|
Unaudited
Condensed Consolidated Statements of Profit or Loss and Other
Comprehensive
Income
|
For the years
ended December 31, 2017 and 2016
|
(RMB and US$
amounts expressed in thousands, except number of shares and ADSs
and
per share data)
|
|
|
|
2016
|
|
2017
|
|
2017
|
|
RMB'
000
|
|
RMB'
000
|
|
US$'
000
|
Revenue
|
|
2,249,533
|
|
2,830,987
|
|
435,115
|
Cost of
sales
|
|
(1,862,017)
|
|
(2,449,399)
|
|
(376,466)
|
Gross
profit
|
|
387,516
|
|
381,588
|
|
58,649
|
Other operating
income
|
|
11,680
|
|
21,171
|
|
3,254
|
Net exchange
gain(loss)
|
|
2,546
|
|
(3,521)
|
|
(541)
|
Selling and
distribution costs
|
|
(181,911)
|
|
(173,800)
|
|
(26,713)
|
Research and
development expenses
|
(84,639)
|
|
(57,419)
|
|
(8,825)
|
Administrative
expenses
|
|
(139,377)
|
|
(130,203)
|
|
(20,012)
|
Finance
costs
|
|
(21,387)
|
|
(21,375)
|
|
(3,285)
|
(Loss) Profit before
taxation
|
|
(25,572)
|
|
16,441
|
|
2,527
|
Income tax
expense
|
|
(352)
|
|
(7,389)
|
|
(1,136)
|
|
|
|
|
|
|
|
(Loss) Profit and
total
comprehensive income for the
year
|
|
(25,924)
|
|
9,052
|
|
1,391
|
|
|
|
|
|
|
|
(Loss) Earnings per
share
|
|
|
|
|
|
|
Basic
|
|
(0.13)
|
|
0.04
|
|
0.01
|
Diluted
|
|
(0.13)
|
|
0.04
|
|
0.01
|
|
|
|
|
|
|
|
(Loss) Earnings per
ADS
|
|
|
|
|
|
|
Basic
|
|
(0.50)
|
|
0.18
|
|
0.03
|
Diluted
|
|
(0.50)
|
|
0.18
|
|
0.03
|
|
|
|
|
|
|
|
Shares
|
|
206,500,000
|
|
206,500,000
|
|
206,500,000
|
ADSs
|
|
51,625,000
|
|
51,625,000
|
|
51,625,000
|
China Zenix Auto
International Limited
|
Unaudited
Consolidated Statements of Financial Position
|
(RMB and US$
amounts expressed in thousands)
|
|
|
|
|
December 31
2016
|
|
December 31
2017
|
|
December 31
2017
|
|
|
|
RMB'000
|
|
RMB'000
|
|
US$'
000
|
|
ASSETS
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
|
Inventories
|
|
138,740
|
|
178,034
|
|
27,363
|
|
Trade and other
receivables and
prepayments
|
|
695,856
|
|
900,162
|
|
138,352
|
|
Prepaid lease
payments
|
|
9,425
|
|
9,425
|
|
1,449
|
|
Pledged bank
deposits
|
|
32,100
|
|
35,200
|
|
5,410
|
|
Fixed bank deposits
with maturity
period over three months
|
|
290,000
|
|
290,000
|
|
44,572
|
|
Bank balances and
cash
|
|
896,799
|
|
751,612
|
|
115,521
|
|
Total current
assets
|
|
2,062,920
|
|
2,164,433
|
|
332,667
|
|
|
|
|
|
|
|
|
|
Non-Current
Assets
|
|
|
|
|
|
|
|
Property, plant and
equipment
|
|
1,379,287
|
|
1,272,774
|
|
195,622
|
|
Prepaid lease
payments
|
|
376,449
|
|
367,024
|
|
56,411
|
|
Deferred tax
assets
|
|
23,836
|
|
25,500
|
|
3,919
|
|
Intangible
assets
|
|
17,000
|
|
17,000
|
|
2,613
|
|
Total non-current
assets
|
|
1,796,572
|
|
1,682,298
|
|
258,565
|
|
Total
assets
|
|
3,859,492
|
|
3,846,731
|
|
591,232
|
|
|
|
|
|
|
|
|
|
EQUITY AND
LIABILITIES
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
|
Trade and other
payables and accruals
|
|
668,633
|
|
635,425
|
|
97,663
|
|
Amount due to a
shareholder
|
|
1,398
|
|
8,742
|
|
1,344
|
|
Taxation
payable
|
|
109
|
|
3,573
|
|
549
|
|
Short-term bank
borrowings
|
|
558,000
|
|
558,000
|
|
85,763
|
|
Total current
liabilities
|
|
1,228,140
|
|
1,205,740
|
|
185,319
|
|
|
|
|
|
|
|
|
|
Deferred tax
liabilities
|
|
85,286
|
|
86,670
|
|
13,321
|
|
Deferred
income
|
|
8,496
|
|
7,699
|
|
1,183
|
|
Total non-current
liabilities
|
|
93,782
|
|
94,369
|
|
14,504
|
|
Total
liabilities
|
|
1,321,922
|
|
1,300,109
|
|
199,823
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
|
|
Share
capital
|
|
136
|
|
136
|
|
21
|
|
Paid in
capital
|
|
392,076
|
|
392,076
|
|
60,261
|
|
Reserves
|
|
2,145,358
|
|
2,154,410
|
|
331,127
|
|
Total equity
attributable to owners
of the company
|
|
2,537,570
|
|
2,546,622
|
|
391,409
|
|
Total equity and
liabilities
|
|
3,859,492
|
|
3,846,731
|
|
591,232
|
China Zenix Auto
International Limited
|
Unaudited
Consolidated Statement of Cash Flows
|
For the year ended
December 31, 2017
|
(RMB and US$
amounts expressed in thousands)
|
|
OPERATING
ACTIVITIES
|
Year Ended
December 31, 2017
|
|
|
RMB'
000
|
|
US$'
000
|
Profit before
taxation
|
16,441
|
|
2,527
|
Adjustments
for:
|
|
|
|
Amortization of prepaid
lease payments
|
9,425
|
|
1,449
|
Depreciation of
property, plant and equipment
|
147,959
|
|
22,741
|
Release of deferred
income
|
(797)
|
|
(122)
|
Finance
costs
|
21,375
|
|
3,285
|
Loss on disposal of
property, plant and equipment
|
31
|
|
5
|
Interest
income
|
(11,020)
|
|
(1,694)
|
Operating cash flows
before movements in working capital
|
183,414
|
|
28,191
|
Increase in
inventories
|
(39,294)
|
|
(6,039)
|
Increase in trade and
other receivables and prepayments
|
(206,950)
|
|
(31,807)
|
Decrease in trade and
other payables and accruals
|
(36,148)
|
|
(5,556)
|
Cash used in
operations
|
(98,978)
|
|
(15,211)
|
Interest
received
|
11,040
|
|
1,697
|
PRC income tax
paid
|
(3,274)
|
|
(503)
|
NET CASH USED IN
OPERATING ACTIVITIES
|
(91,212)
|
|
(14,017)
|
INVESTING
ACTIVITIES
|
|
|
|
Purchase of property,
plant and equipment
|
(35,617)
|
|
(5,475)
|
Withdrawal of pledged
bank deposits
|
4,000
|
|
614
|
Placement of pledged
bank deposits
|
(7,100)
|
|
(1,091)
|
Proceeds on disposal
of property, plant and equipment
|
238
|
|
37
|
Placement of fixed
bank deposits with maturity periods
over three months
|
(580,000)
|
|
(89,144)
|
Withdrawal of fixed
bank deposits with maturity periods
over three months
|
580,000
|
|
89,144
|
NET CASH USED IN
INVESTING ACTIVITIES
|
(38,479)
|
|
(5,915)
|
FINANCING
ACTIVITIES
|
|
|
|
New bank borrowings
raised
|
558,000
|
|
85,763
|
Repayment of bank
borrowings
|
(558,000)
|
|
(85,763)
|
Interest
paid
|
(24,533)
|
|
(3,771)
|
Advance from a
shareholder
|
7,344
|
|
1,129
|
NET CASH USED IN
FINANCING ACTIVITIES
|
(17,189)
|
|
(2,642)
|
NET DECREASE IN
CASH AND CASH EQUIVALENTS
|
(146,880)
|
|
(22,574)
|
Cash and cash
equivalents at beginning of the year
|
896,799
|
|
137,835
|
Effect of foreign
exchange rate changes
|
1,693
|
|
260
|
Cash and cash
equivalents at end of the year
|
751,612
|
|
115,521
|
|
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/china-zenix-auto-international-limited-reports-fourth-quarter-and-full-year-2017-results-300614458.html
SOURCE China Zenix Auto International Limited