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Ever-Glory Reports Third Quarter 2021 Financial Resultsnew

Add: 2021   Update: 2021/11/12

 Ever-Glory Reports Third Quarter 2021 Financial Results

NANJING, China, November 12, 2021 /PRNewswire/ -- Ever-Glory International Group, Inc. (the “Company” or “Ever-Glory”) (NASDAQ: EVK), a retailer of branded fashion apparel and a leading global apparel supply chain solution provider, reported its financial results today for the third quarter ended September 30, 2021.

Mr. Yihua Kang, Chairman, President and Chief Executive Officer of Ever-Glory, said, “During the third quarter, we maintained our focus on developing the retail business through our multi-brand strategy and store network optimization initiative, while improving our wholesale business by upgrading customer portfolio and enhancing our account receivables.”

“During the third quarter of 2021, our retail brands continue to attract new customers and retain existing customers by focusing on design, quality and value,” Mr. Kang continued. “Following the remodeling or relocation of 113 stores during 2021, we operated a nationwide network of 893 stores as of September 30, 2021.”

“Looking at our wholesale business, we maintained focus on upgrading customer portfolio to reduce credit risk and improve margin in light of weak micro-environment and enhancing our account receivables. Going forward, we’ll implement a stricter client evaluation system and remain diligent in our account receivables collection. We believe the enduring strength of our wholesale business will support its long-term profitability,” Mr. Kang concluded.

Mr. Jason Jiansong Wang, Chief Financial Officer of Ever-Glory, added, “The third quarter results are coupled with our ability to increase operating leverage. Going forward, we remain confidence in the long-term prospects of our business and we will continue implementing our margin enhancement and cost control measures to further strengthen the profitability of our business.”

Third Quarter 2021 Financial Results 

Total sales for the third quarter of 2021 were $94.4 million, an increase of 18.1% from $79.9 million in the third quarter of 2020. This increase was primarily driven by a 38.0% increase in our wholesale business partially offset by a 7.6% decrease in retail business.

Sales for the Company’s branded fashion apparel retail division decreased by 7.6% to $32.2 million for the third quarter of 2021, compared with $34.8 million for the third quarter of 2020. This decrease was primarily due to a decrease in the e-commerce sales. The Company operated 893 retail stores as of September 30, 2021, compared with 923 retail stores as of September 30, 2020.

Sales for the Company’s wholesale division increased by 38.0% to $62.2 million for the third quarter of 2021, compared with $45.1 million for the third quarter of 2020. This increase was primarily attributable to an increase in sales in Mainland China, Europe-Other, Japan and United States partially offset by a decrease in sales in Hong Kong and United Kingdom.

 

Total gross profit for the third quarter of 2021 decreased by 2% to $23.2 million, compared with $23.7 million for the third quarter of 2020. Total gross margin for the third quarter of 2021 decreased to 24.6% from 29.6% for the third quarter of 2020.

Gross profit for the retail business decreased by 10.3% to $13.0 million for the third quarter of 2021, compared with $14.5 million for the third quarter of 2020. Gross margin for the third quarter of 2021 was 40.3% compared to 41.6% for the third quarter of 2020.

Gross profit for the wholesale business increased by 11.2% to $10.2 million for the third quarter of 2021, compared with $9.2 million for the third quarter of 2020. Gross margin for the third quarter of 2021 decreased to 16.4% from 20.4% for the third quarter of 2020.

Selling expenses for the third quarter of 2021 increased by 11.1% to $14.4 million, or 15.3% of total sales, compared with $13.0 million, or 16.3% of total sales for the third quarter of 2020. The increase was attributable to the higher travelling expenses.

 

General and administrative expenses for the third quarter of 2021 increased by 21.1% to $9.5 million, or 10% of total sales, compared with $7.8 million, or 9.8% of total sales for the third quarter of 2020. The increase was attributable to the increased salaries.

 

(Loss) Income from operations was ($0.7 million) for the third quarter of 2021, compared to $2.9 million for the third quarter of 2020.

Net loss attributable to the Company for the third quarter of 2021 was ($3.2 million) compared with $2.2 million for the third quarter of 2020. Basic and diluted loss per share were ($0.22) for the third quarter of 2021 compared with $0.15 for the third quarter of 2020.

Balance Sheet 

As of September 30, 2021, Ever-Glory had approximately $48.3 million of cash and cash equivalents, compared with approximately $81.9 million as of December 31, 2020. Ever-Glory had working capital of approximately $44.6 million as of September 30, 2021, and outstanding bank loans of approximately $67.8 million as of September 30, 2021.

Conference Call

The Company will hold a conference call at 7:00 a.m. Eastern Time on November 12, 2021(8:00 p.m. Beijing Time on November 12, 2021). Listeners can access the conference call by dialing +1-800-289-0438 or +1-323-794-2423 and using the access code 7678571. The conference call will also be webcast live over the Internet and can be accessed at the Company’s website at http://www.everglorygroup.com.

A replay of the call will be available from 10:00 a.m. Eastern Time on November 12 through 11:59 p.m. Eastern Time on November 19 by calling +1-844-512-2921 or +1-412-317-6671 with pin number 7678571.

About Ever-Glory International Group, Inc.

Based in Nanjing, China, Ever-Glory International Group, Inc. is a retailer of branded fashion apparel and a leading global apparel supply chain solution provider. Ever-Glory is the first Chinese apparel Company listed on the American Stock Exchange (now named as NYSE MKT) in July 2008 and then transferred to The NASDAQ Global Market on December 31, 2015. Ever-Glory offers apparel to woman in China under its own brands “La go go”, “Velwin” and “idole”. Ever-Glory is also a leading global apparel supply chain solution provider with a focus on middle-to-high end casual wear, outerwear, and sportswear brands. Ever-Glory services a number of well-known brands and retail stores by providing a complete set of supply chain management services, including: fabric development and design, sampling, sourcing, quality control, manufacturing, logistics, customs clearance and distribution.

Forward-Looking Statements

Certain statements in this release and other written or oral statements made by or on behalf of Ever-Glory International Group, Inc. (the “Company”) are “forward looking statements” within the meaning of the federal securities laws. Statements regarding future events and developments and the Company’s future performance, as well as management’s expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements within the meaning of these laws. The forward looking statements are subject to a number of risks and uncertainties including, without limitation, market acceptance of the Company’s products and offerings, development and expansion of the Company’s wholesale and retail operations, the Company’s continued access to capital, currency exchange rate fluctuation and other risks and uncertainties. The actual results the Company achieves (including, without limitation, the results stemming from the future implementation of the Company’s strategies and the revenue, net income and new retail store projections set forth herein) may differ materially from those contemplated by any forward-looking statements due to such risks and uncertainties (many of which are beyond the Company’s control). These statements are based on management’s current expectations and speak only as of the date of such statements. Readers should carefully review the risks and uncertainties described in the Company’s latest Annual Report on Form 10-K and other documents that the Company files from time to time with the U.S. Securities and Exchange Commission. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

For investor and media inquiries, please contact:

Ever-Glory International Group

Dandan Song

Tel: +86-25-5209-6817

E-Mail: sdd@ever-glory.com.cn

EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

 

(In thousands of U.S. Dollars, except share and per share data or otherwise stated)

 

 

 

September 30,
2021

 

 

December 31,
2020

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

 

Cash and cash equivalents

 

$

48,336

 

 

$

81,865

 

Restricted cash

 

 

43,176

 

 

 

39,858

 

Trading securities

 

 

3,068

 

 

 

1,792

 

Accounts receivable, net

 

 

61,525

 

 

 

53,285

 

Inventories

 

 

67,275

 

 

 

53,893

 

Advances on inventory purchases

 

 

9,864

 

 

 

10,261

 

Value added tax receivable

 

 

2,484

 

 

 

1,244

 

Other receivables and prepaid expenses

 

 

6,638

 

 

 

5,479

 

Amounts due from related parties

 

 

1,994

 

 

 

567

 

Total Current Assets

 

 

243,360

 

 

 

248,244

 

 

 

 

 

 

 

 

 

 

NON-CURRENT ASSETS

 

 

 

 

 

 

 

 

Equity security investment

 

 

5,903

 

 

 

3,932

 

Intangible assets, net

 

 

4,686

 

 

 

4,794

 

Property and equipment, net

 

 

32,747

 

 

 

32,164

 

Operating lease right-of-use assets

 

 

49,002

 

 

 

41,690

 

Deferred tax assets

 

 

265

 

 

 

902

 

Other non-current assets

 

 

771

 

 

 

-

 

Total Non-Current Assets

 

 

93,374

 

 

 

83,482

 

TOTAL ASSETS

 

$

337,734

 

 

$

331,726

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

 

Bank loans

 

$

67,848

 

 

$

65,919

 

Accounts payable

 

 

73,120

 

 

 

67,762

 

Accounts payable and other payables – related parties

 

 

1,016

 

 

 

3,764

 

Other payables and accrued liabilities

 

 

13,758

 

 

 

16,073

 

Value added and other taxes payable

 

 

554

 

 

 

909

 

Income tax payable

 

 

1,900

 

 

 

1,062

 

Current operating lease liabilities

 

 

40,590

 

 

 

33,481

 

Total Current Liabilities

 

 

198,786

 

 

 

188,970

 

 

 

 

 

 

 

 

 

 

NON-CURRENT LIABILITIES

 

 

 

 

 

 

 

 

Non-current operating lease liabilities

 

 

8,549

 

 

 

8,307

 

TOTAL LIABILITIES

 

 

207,335

 

 

 

197,277

 

 

 

 

 

 

 

 

 

 

COMMITMENTS AND CONTINGENCIES (Note 9)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Common stock ($0.001 par value, authorized 50,000,000 shares, 14,812,312 and 14,809,160 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively)

 

 

15

 

 

 

15

 

Additional paid-in capital

 

 

3,660

 

 

 

3,650

 

Retained earnings

 

 

103,013

 

 

 

109,171

 

Statutory reserve

 

 

20,376

 

 

 

20,376

 

Accumulated other comprehensive income

 

 

5,610

 

 

 

4,590

 

Amounts due from related party

 

 

(2,275

)

 

 

(3,353

)

Total equity

 

 

130,399

 

 

 

134,449

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$

337,734

 

 

$

331,726

 

 

EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited)

(In thousands of U.S. Dollars, except share and per share data or otherwise stated)

 

 

 

Three months ended

 

 

Nine months ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

NET SALES

 

$

94,406

 

 

$

79,908

 

 

$

225,776

 

 

$

188,350

 

COST OF SALES

 

 

71,196

 

 

 

56,235

 

 

 

161,738

 

 

 

134,193

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GROSS PROFIT

 

 

23,210

 

 

 

23,673

 

 

 

64,038

 

 

 

54,157

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling expenses

 

 

14,443

 

 

 

12,996

 

 

 

44,495

 

 

 

39,101

 

General and administrative expenses

 

 

9,467

 

 

 

7,818

 

 

 

24,980

 

 

 

19,574

 

Total Operating Expenses

 

 

23,910

 

 

 

20,814

 

 

 

69,475

 

 

 

58,675

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(LOSS) INCOME FROM OPERATIONS

 

 

(700

)

 

 

2,859

 

 

 

(5,437

)

 

 

(4,518

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER INCOME (EXPENSES)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

176

 

 

 

313

 

 

 

928

 

 

 

930

 

Interest expense

 

 

(1,218

)

 

 

(700

)

 

 

(1,909

)

 

 

(1,607

)

Government subsidy

 

 

340

 

 

 

235

 

 

 

842

 

 

 

926

 

(Loss) Gain from changes in fair values of investments

 

 

(123

)

 

 

(4

)

 

 

2,151

 

 

 

-

 

Other income (expenses)

 

 

253

 

 

 

343

 

 

 

1,027

 

 

 

1,310

 

Total Other Income (expenses), Net

 

 

(572

)

 

 

187

 

 

 

3,039

 

 

 

1,559

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(LOSS) INCOME BEFORE INCOME TAX EXPENSE

 

 

(1,272

)

 

 

3,046

 

 

 

(2,398

)

 

 

(2,959

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax expense

 

 

(1,945

)

 

 

(822

)

 

 

(3,759

)

 

 

(1,315

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET (LOSS) INCOME

 

 

(3,217

)

 

 

2,224

 

 

 

(6,157

)

 

 

(4,274

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss attributable to the non-controlling interest

 

 

-

 

 

 

(8

)

 

 

-

 

 

 

(4

)

NET LOSS ATTRIBUTABLE TO THE COMPANY

 

 

(3,217

)

 

 

2,216

 

 

 

(6,157

)

 

 

(4,278

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NET (LOSS) INCOME

 

$

(3,217

)

 

$

2,224

 

 

$

(6,157

)

 

$

(4,274

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation gain (loss)

 

 

(1,061

)

 

 

4,664

 

 

 

1,020

 

 

 

2,964

 

COMPREHENSIVE INCOME (LOSS)

 

 

(4,278

)

 

 

6,888

 

 

 

(5,137

)

 

 

(1,310

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive loss attributable to the non-controlling interest

 

 

-

 

 

 

51

 

 

 

-

 

 

 

53

 

COMPREHENSIVE INCOME  (LOSS) ATTRIBUTABLE TO THE COMPANY

 

$

(4,278

)

 

$

6,939

 

 

$

(5,137

)

 

$

(1,257

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOSS PER SHARE ATTRIBUTABLE TO THE COMPANY’S STOCKHOLDERS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

$

(0.22

)

 

$

0.15

 

 

$

(0.42

)

 

$

(0.29

)

Weighted average number of shares outstanding Basic and diluted

 

 

14,811,073

 

 

 

14,808,737

 

 

 

14,810,585

 

 

 

14,805,987

 

 

See the accompanying notes to the condensed consolidated financial statements.

 

 

EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Unaudited)

(In thousands of U.S. Dollars, except share and per share data or otherwise stated)

 

 

 

 

 

 

Additional

 

 

Retained Earnings

 

 

Accumulated
other

 

 

Amounts
due from

 

 

Total
equity
attributable
to stockholders

 

 

 

 

 

 

Common Stock

 

 

paid-in

 

 

 

 

 

Statutory

 

 

Comprehensive

 

 

related

 

 

of the

 

 

Total 

 

 

 

Shares

 

 

Amount

 

 

capital

 

 

Unrestricted

 

 

reserve

 

 

loss

 

 

party

 

 

Company

 

 

equity

 

Balance at January  1, 2021

 

 

14,809,160

 

 

$

15

 

 

$

3,650

 

 

$

109,171

 

 

$

20,376

 

 

$

4,590

 

 

$

(3,353

)

 

$

134,449

 

 

$

134,449

 

Stock issued for compensation

 

 

1,500

 

 

 

-

 

 

 

5

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5

 

 

 

5

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(1,170

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(1,170

)

 

 

(1,170

)

Net cash received from related party under counter guarantee agreement

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

379

 

 

 

379

 

 

 

379

 

Foreign currency translation gain (loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,352

)

 

 

-

 

 

 

(1,352

)

 

 

(1,352

)

Balance at March 31, 2021

 

 

14,810,660

 

 

 

15

 

 

 

3,655

 

 

 

108,001

 

 

 

20,376

 

 

 

3,238

 

 

 

(2,974

)

 

 

132,311

 

 

 

132,311

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,771

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,771

)

 

 

(1,771

)

Net cash received from related party under counter guarantee agreement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

386

 

 

 

386

 

 

 

386

 

Foreign currency translation loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3,434

 

 

 

 

 

 

 

3,434

 

 

 

3,434

 

Balance at June 30, 2021

 

 

14,810,660

 

 

$

15

 

 

$

3,655

 

 

$

106,230

 

 

$

20,376

 

 

$

6,672

 

 

$

(2,588

)

 

$

134,360

 

 

$

134,360

 

Stock issued for compensation

 

 

1,652

 

 

 

-

 

 

 

5

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5

 

 

 

5

 

Net (Loss) income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3,217

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3,217

)

 

 

(3,217

)

Net cash received from related party under counter guarantee agreement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

313

 

 

 

313

 

 

 

313

 

Foreign currency translation gain

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,062

)

 

 

 

 

 

 

(1,062

)

 

 

(1,062

)

Balance at September 30, 2021

 

 

14,812,312

 

 

$

15

 

 

$

3,660

 

 

$

103,013

 

 

$

20,376

 

 

$

5,610

 

 

$

(2,275

)

 

$ 

130,399

 

 

$

130,399

 

 

 

 

 

 

 

Additional

 

 

Retained Earnings

 

 

Accumulated
other

 

 

Amounts
due from

 

 

Total
equity
attributable
to stockholders

 

 

Non-

 

 

 

 

 

 

Common Stock

 

 

paid-in

 

 

 

 

 

Statutory

 

 

Comprehensive

 

 

related

 

 

of the

 

 

controlling

 

 

Total

 

 

 

Shares

 

 

Amount

 

 

capital

 

 

Unrestricted

 

 

reserve

 

 

loss

 

 

party

 

 

Company

 

 

Interest

 

 

equity

 

Balance at January  1, 2020

 

 

14,801,770

 

 

$

15

 

 

$

3,640

 

 

$

106,328

 

 

$

19,939

 

 

$

(4,330

)

 

$

(4,932

)

 

$

120,660

 

 

 

(1,510

)

 

$

119,150

 

Stock issued for compensation

 

 

3,062

 

 

 

-

 

 

 

5

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5

 

 

 

 

 

 

 

5

 

Net loss

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,701

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,701

)

 

 

3

 

 

 

(2,698

)

Net cash received from related party under counter guarantee agreement

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

785

 

 

 

785

 

 

 

-

 

 

 

785

 

Foreign currency translation gain (loss)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,440

)

 

 

-

 

 

 

(1,440

)

 

 

3

 

 

 

(1,437

)

Balance at March 31, 2020

 

 

14,804,832

 

 

 

15

 

 

 

3,645

 

 

 

103,627

 

 

 

19,939

 

 

 

(5,770

)

 

 

(4,147

)

 

 

117,309

 

 

 

(1,504

)

 

 

115,805

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3,794

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3,794

)

 

 

(6

)

 

 

(3,800

)

Net cash received from related party under counter guarantee agreement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

151

 

 

 

151

 

 

 

 

 

 

 

151

 

Foreign currency translation loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(261

)

 

 

 

 

 

 

(261

)

 

 

(2

)

 

 

(263

)

Balance at June 30, 2020

 

 

14,804,832

 

 

$

15

 

 

$

3,645

 

 

$

99,833

 

 

$

19,939

 

 

$

(6,031

)

 

$

(3,996

)

 

$

113,405

 

 

 

(1,512

)

 

$

111,893

 

Stock issued for compensation

 

 

4,328

 

 

 

-

 

 

 

5

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5

 

 

 

 

 

 

 

5

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,216

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,216

 

 

 

8

 

 

 

2,224

 

Net cash received from related party under counter guarantee agreement

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

566

 

 

 

566

 

 

 

-

 

 

 

566

 

Foreign currency translation gain

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

4,723

 

 

 

 

 

 

 

4,723

 

 

 

(59

)

 

 

4,664

 

Balance at September 30, 2020

 

 

14,809,160

 

 

$

15

 

 

$

3,650

 

 

$

102,049

 

 

$

19,939

 

 

$

(1,308

)

 

$

(3,430

)

 

$

120,915

 

 

 

(1,563

)

 

$

119,352

 

 

EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(In thousands of U.S. Dollars, except share and per share data or otherwise stated)

 

 

 

Nine Months Ended

 

 

 

September 30,
2021

 

 

September 30,
2020

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

Net loss

 

$

(6,157

)

 

$

(4,274

)

Adjustments to reconcile net loss to cash provided by operating activities:

 

 

　

 

 

 

　

 

Depreciation and amortization

 

 

4,384

 

 

 

4,114

 

Loss from sale of property and equipment

 

 

590

 

 

 

283

 

Provision of bad debt allowance

 

 

676

 

 

 

683

 

Write off obsolete inventories

 

 

7,595

 

 

 

5,786

 

Changes in fair value of investment

 

 

(2,151

)

 

 

13

 

Deferred income tax

 

 

644

 

 

 

(165

)

Stock-based compensation

 

 

10

 

 

 

10

 

Changes in operating assets and liabilities

 

 

 

 

 

 

 

 

Accounts receivable

 

 

(8,614

)

 

 

15,571

 

Inventories

 

 

(20,702

)

 

 

16,135

 

Value added tax receivable

 

 

(1,235

)

 

 

(577

)

Other receivables and prepaid expenses

 

 

(1,096

)

 

 

50

 

Advances on inventory purchases

 

 

586

 

 

 

2,461

 

Amounts due from related parties

 

 

(1,514

)

 

 

(848

)

Accounts payable

 

 

5,930

 

 

 

(7,842

)

Accounts payable and other payables- related parties

 

 

(3,204

)

 

 

(1,112

)

Other payables and accrued liabilities

 

 

(3,332

)

 

 

(6,093

)

Value added and other taxes payable

 

 

(360

)

 

 

467

 

Income tax payable

 

 

831

 

 

 

(64

)

Net cash (used in) provided by operating activities

 

 

(27,119

)

 

 

24,598

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

 

 

 

Purchases of property and equipment

 

 

(5,109

)

 

 

(2,769

)

Net (purchase) sale of trading securities

 

 

(1,077

)

 

 

(901

)

Investment payment

 

 

(773

)

 

 

(2,860

)

Net cash (used in) investing activities

 

 

(6,959

)

 

 

(6,530

)

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

Proceeds from bank loans

 

 

56,110

 

 

 

66,599

 

Repayment of bank loans

 

 

(54,565

)

 

 

(49,278

)

Net collection (advance) of amounts due from related party (equity)

 

 

1,630

 

 

 

1,618

 

Net cash  used in (provided by) financing activities

 

 

3,175

 

 

 

18,939

 

 

 

 

 

 

 

 

 

 

EFFECT OF EXCHANGE RATE CHANGES ON CASH

 

 

693

 

 

 

2,740

 

 

 

 

　

 

 

 

　

 

NET (DECREASE) INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH

 

 

(30,211

)

 

 

39,747

 

 

 

 

　

 

 

 

　

 

CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF PERIOD

 

 

121,723

 

 

 

50,755

 

 

 

 

　

 

 

 

　

 

CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD

 

$

91,512

 

 

$

90,502

 

 

 

 

 

 

 

 

 

 

Reconciliation of cash, cash equivalents and restricted cash reported within their consolidated balance sheets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash and Cash Equivalents

 

 

48,336

 

 

 

69,950

 

Restricted cash

 

 

43,176

 

 

 

20,552

 

 

 

$

91,512

 

 

$

90,502

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

 

 

 

 

 

 

 

 

Cash paid during the period for:

 

 

 

 

 

 

 

 

Interest

 

$

1,909

 

 

$

1,607

 

Income taxes

 

$

2,272

 

 

$

1,455

 

 

 

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