In the news release, China Nepstar Chain Drugstore Ltd. Reports
First Quarter 2015 Financial Results, issued 26-May-2015 by China Nepstar Chain Drugstore Ltd.
over PR Newswire, we are advised by the company that the first
paragraph following Financial Highlits, [Mr. Simin Zhang, Chairman of Nepstar] sentence,
should read "[Ms. Rebecca Yingnan
Zhang, Chief Executive Officer of Nepstar ]" rather than
"[Mr. Simin Zhang, Chairman of
Nepstar]". The third paragraph following First Quarter Results,
[First quarter revenue contribution by product category was 23.7%
from prescription drugs (23.3% for the same period in 2014); 41.2%
from over-the-counter ("OTC") drugs (40.3% for the same period in
2014); 12.3%from nutritional supplements (14.8% for the same period
in 2014); 4.6%from herbal products (4.5% for the same period in
2014); and 18.2% from convenience and other products (17.1% for the
same period in 2014).] sentence, should read "[First quarter
revenue contribution by product category was 23.7% from
prescription drugs (23.3% for the same period in 2014); 41.2% from
over-the-counter ("OTC") drugs (40.3% for the same period in 2014);
12.3% from nutritional supplements (14.8% for the same period in
2014); 4.6% from herbal products (4.5% for the same period in
2014); and 18.2% from convenience and other products (17.1% for the
same period in 2014).]". The paragraph following Business Outlook,
[commented Mr. Zhang] sentence, should read "[commented Ms.
Zhang.]" rather than "[commented Mr. Zhang]". The complete,
corrected release follows:
China Nepstar Chain Drugstore Ltd. Reports First Quarter 2015
Financial Results
SHENZHEN, China, May 26, 2015 /PRNewswire/ -- China Nepstar
Chain Drugstore Ltd. (NYSE: NPD) ("Nepstar" or the "Company"),
a leading retail drugstore chain in China based on the number of directly operated
stores, today announced its unaudited financial results for the
first quarter ended March 31, 2015.
Financial Highlights
- Same store sales increased by 13.6% compared to the first
quarter of 2014
- Revenue increased by 11.9% to RMB759.1 million (US$122.5 million) compared to RMB678.3 million in the first quarter of
2014
- Net loss decreased to RMB3.4
million (US$0.5 million) from
a net loss of RMB18.2 million
in the first quarter of 2014
- Basic and diluted losses per ADS
were RMB0.03 (US$0.006) compared to basic and diluted
losses per ADS of RMB0.18 in the
first quarter of 2014
Ms. Rebecca
Yingnan Zhang, Chief Executive Officer of Nepstar,
"We are pleased to report strong growth in same store sales and
revenue, as well as significant improvement in reducing
administrative expenses compared to the same period of last year.
We have leveraged our store network and increased in-store
promotions as well as marketing efforts for pharmaceutical
products. Enhancement in our operating efficiencies and cost
streamlining also contributed to the growth in sales and revenue as
well as improvement in administrative expense reduction as compared
to the first quarter of 2014."
First Quarter Results
During the first quarter of 2015, the Company opened 26 new
stores and closed 37 stores. As of March 31,
2015, the Company had a total of 1,969 directly operated
stores.
Revenue for the first quarter of 2015 increased by 11.9%
to RMB759.1 million (US$122.5million) from RMB678.3
million for the same period in 2014. Same store sales (for the
1,819 stores opened before December 31, 2013 and which
remained in operation as of March 31,
2015) for the first quarter of 2015 increased by 13.6%
compared to the same period in 2014. The increases in revenue and
same store sales were mainly due to our increased in-store
promotional initiatives and marketing of pharmaceutical
products.
First quarter revenue contribution by
product category was 23.7% from prescription drugs (23.3% for the
same period in 2014); 41.2% from over-the-counter ("OTC") drugs
(40.3% for the same period in 2014); 12.3% from nutritional
supplements (14.8% for the same period in 2014); 4.6% from herbal
products (4.5% for the same period in 2014); and 18.2% from
convenience and other products (17.1% for the same period in
2014).
First quarter gross profit increased to RMB309.4
million (US$49.9 million) from
RMB278.4 million in the same
period of 2014. Gross profit margin in the first quarter of 2015
was 40.8%, compared with 41.0% in the same period of 2014.
The Company's portfolio of private label products expanded to
2,146 types of products as of March 31, 2015. Sales of private
label products represented approximately 15.4% of total revenue and
22.7% of total gross profit for the first quarter of 2015.
Sales, marketing and other operating expenses slightly increased
for the first quarter of 2015 compared to the same period of 2014,
but its percentage as of revenue decreased to 36.5% from 39.9%.
General and administrative expenses as a percentage of revenue
were 4.3% for the first quarter of 2015 compared to 5.4% for the
same period of 2014. This decrease primarily resulted from
management's efforts to streamline costs.
Loss from operations in the first quarter of 2015 was
RMB0.2 million (US$30.5 thousand) compared with loss from
operations of RMB28.8 million in
the same period of 2014.The significant reduction in loss was
mainly due to increased sales and our cost control measures in the
first quarter of 2015.
Interest income for the first quarter of 2015 was RMB1.7
million (US$0.3 million),
compared with RMB2.5 million for the same period of
2014.
The Company's income tax expense was RMB6.8
million (US$1.1 million) for the
first quarter of 2015, compared with tax credit of RMB3.1 million for the same period in
2014.The effective tax rate for the first quarter of 2015 was
198.6%. The difference in the effective income tax rate and the PRC
statutory tax rate of 25% applicable to our major operating
subsidiaries was primarily due to non-deductible expenses and the
operating losses from certain loss-making subsidiaries, for which
full valuation allowances were made on their deferred tax assets,
when compared to the overall results of operation of the Company.
Shareholders are reminded that in the PRC, losses in companies
which are part of a group are not allowed to be off-set against
profits arising from other companies in the same group.
Net loss for the first quarter of 2015 was RMB3.4
million (US$0.5 million), or
RMB0.03 (US$0.006) basic and diluted losses per ADS,
compared to net loss of RMB18.2
million, or RMB0.18 basic and
diluted losses per ADS for the first quarter of 2014. As of
March 31, 2015, the Company had 197.4
million outstanding ordinary shares. Each ADS represents two
ordinary shares of the Company.
In the first quarter of 2015, net cash flow provided by
operating activities was RMB51.9 million (US$8.4 million), compared to net cash outflow of
RMB22.6 million for the same period
in 2014. This reversal of cash outflow was primarily due to
improved operating performance during the first quarter of 2015,
compared to the same period in 2014.
As of March 31, 2015, the Company's total cash, cash
equivalents, bank deposits and restricted cash were RMB327.9
million (US$52.9 million) and its
shareholders' equity was RMB828.2 million (US$133.6 million), compared to RMB316.9
million and RMB831.6 million, respectively, as
of December 31, 2014.
Business Outlook
"We are excited by the momentum in our business development in
the first quarter of 2015 and will continue to focus on maintaining
growth, managing expenses and improving margins. We believe
that our strong store network, optimized product offerings and
proactive steps to improve customer experience and loyalty, will
continue to drive store traffic and revenue in the near term,"
commented Ms. Zhang.
Conference Call Information
The Company will host a conference call, to be simultaneously
webcasted, on Tuesday, May 26, 2015 at 8:00 a.m.
Eastern Time / 8:00 p.m. Beijing Time. Interested
parties may participate in the conference call by dialing
+1-877-407-9210 (North America) or
+1-201-689-8049 (International) approximately five minutes before
the call start time. A live web cast of the call will be available
on the Nepstar website at www.nepstar.cn.
A replay of the call will be available shortly after the
conclusion of the conference call through June 2,
2015 at 11:59 p.m. Eastern Time. An archived web cast of
the conference call will be available on the Nepstar website
at http://www.nepstar.cn. Interested parties may access the
replay by dialing +1-877-660-6853 (North
America) or +1-201-612-7415 (International) and entering
conference ID number 13609556.
About China Nepstar Chain Drugstore
Ltd.
China Nepstar Chain Drugstore Ltd. (NYSE: NPD) is a leading
retail drugstore chain in China. As of March 31, 2015,
the Company had 1,969 directly operated stores across 74 cities,
one headquarter distribution center and 15 regional distribution
centers in China. Nepstar uses directly operated stores,
centralized procurement and a network of distribution centers to
provide its customers with high-quality, professional and
convenient pharmaceutical products and services and a wide variety
of other merchandise, including OTC drugs, nutritional supplements,
herbal products, personal care products, family care products, and
convenience products. Nepstar's strategy of centralized
procurement, competitive pricing, customer loyalty programs and
private label offerings has enabled it to capitalize on the
continuing economic growth in China and take advantage of the
demographic trend in China to achieve a strong brand and
leading market position. For further information, please go
to http://www.nepstar.cn.
Safe Harbor Statement
This press release contains forward-looking statements. These
statements constitute "forward-looking" statements within the
meaning of Section 21E of the Securities Exchange Act of 1934, as
amended, and as defined in 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" and similar
statements. Among other things, the quotations from management in
this press release and the Company's strategic operational plans
and business outlook, contain forward-looking statements. Such
statements involve certain risks and uncertainties that could cause
actual results to differ materially from those in the
forward-looking statements. Further information regarding these and
other risks is included in the Company's filings with the U.S.
Securities and Exchange Commission, including its annual report on
Form 20-F. The Company does not undertake any obligation to update
any forward-looking statement as a result of new information,
future events or otherwise, except as required under applicable
law.
Exchange Rate Information
The United States dollar (US$) amounts disclosed in this
press release are presented solely for the convenience of the
reader. Translations of amounts from RMB into United
States dollars were calculated at the certified exchange rate
ofUS$1.00 = RMB6.1990 on March 31, 2015 as
set forth in the H.10 weekly statistical release of the Federal
Reserve Board. No representation is made that the RMB amounts could
have been, or could be, converted into US$ at that rate or at any
other date. The percentages stated are calculated based on RMB
amounts.
Contacts
Zixin Shao
China Nepstar Chain Drugstore Ltd.
Chief Financial Officer
+86-755-2641-4065
ir@nepstar.cn
Shiwei Yin
Grayling
Investor Relations
+1-646-284-9474
npd@grayling.com
(Tables Follow)
China Nepstar
Chain Drugstore Ltd.
|
Unaudited Condensed
Consolidated Statements of Operation
|
(amounts in
thousands – except per-share and per-ADS data)
|
|
|
|
Three-month period
ended
|
March
31,
|
|
2014
|
2015
|
2015
|
|
RMB
|
RMB
|
USD
|
|
|
|
|
Revenue
|
678,281
|
759,119
|
122,458
|
Cost of goods
sold
|
(399,904)
|
(449,769)
|
(72,555)
|
Gross
profit
|
278,377
|
309,350
|
49,903
|
Sales, marketing and
other operating expenses
|
(270,760)
|
(277,203)
|
(44,717)
|
General and
administrative expenses
|
(36,378)
|
(32,336)
|
(5,216)
|
Loss from
operations
|
(28,761)
|
(189)
|
(30)
|
Interest
income
|
2,529
|
1,719
|
277
|
Dividend income from
cost method investments
|
4,932
|
1,022
|
165
|
Other
income
|
-
|
890
|
143
|
(Loss)/income before
income tax expense
|
(21,300)
|
3,442
|
555
|
Income tax
benefit/(expense)
|
3,111
|
(6,835)
|
(1,103)
|
Net loss
|
(18,189)
|
(3,393)
|
(548)
|
|
|
|
|
Basic losses per
ordinary share
|
(0.092)
|
(0.017)
|
(0.003)
|
Basic losses per
ADS
|
(0.184)
|
(0.034)
|
(0.006)
|
Diluted losses per
ordinary share
|
(0.092)
|
(0.017)
|
(0.003)
|
Diluted losses per
ADS
|
(0.184)
|
(0.034)
|
(0.006)
|
|
|
|
|
Net loss
|
(18,189)
|
(3,393)
|
(548)
|
|
|
|
|
Other comprehensive
(loss)/income, net of tax:
|
|
|
|
Foreign currency
translation adjustments
|
(161)
|
6
|
1
|
Comprehensive
loss
|
(18,350)
|
(3,387)
|
(547)
|
|
|
|
|
|
|
China Nepstar
Chain Drugstore Ltd.
|
Unaudited Condensed
Consolidated Balance Sheets
|
(amounts in
thousands)
|
|
|
|
|
|
As
of
|
As
of
|
As
of
|
December
31,
|
March
31,
|
March
31,
|
|
2014
|
2015
|
2015
|
|
RMB
|
RMB
|
USD
|
|
|
|
|
ASSETS
|
|
|
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
252,174
|
278,240
|
44,885
|
Short-term bank time
deposits
|
24,000
|
9,000
|
1,452
|
Long-term bank time
deposits due within one year
|
3,256
|
3,256
|
525
|
Restricted
cash
|
37,423
|
37,355
|
6,026
|
Short-term
investments
|
-
|
27,000
|
4,356
|
Accounts receivable,
net of allowance for doubtful accounts
|
136,568
|
126,581
|
20,420
|
Bills
receivable
|
400
|
-
|
-
|
Amounts due from
related parties
|
3,366
|
4,035
|
651
|
Prepaid expenses,
deposits and other current assets
|
245,254
|
207,292
|
33,439
|
Inventories
|
546,312
|
554,826
|
89,502
|
Deferred tax
assets
|
2,038
|
3,611
|
582
|
Total current
assets
|
1,250,791
|
1,251,196
|
201,838
|
|
|
|
|
Non-current
assets
|
|
|
|
Property and
equipment, net
|
137,750
|
141,735
|
22,864
|
Rental
deposits
|
42,257
|
41,315
|
6,665
|
Cost method
investments
|
12,638
|
12,638
|
2,039
|
Intangible assets,
net
|
2,509
|
2,509
|
405
|
Goodwill
|
51,819
|
51,819
|
8,359
|
Deferred tax
assets
|
16,340
|
14,990
|
2,418
|
Total non-current
assets
|
263,313
|
265,006
|
42,750
|
Total
assets
|
1,514,104
|
1,516,202
|
244,588
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
Accounts
payable
|
409,428
|
430,160
|
69,392
|
Amounts due to
related parties
|
25,636
|
24,489
|
3,950
|
Accrued expenses and
other payables
|
122,236
|
102,680
|
16,564
|
Income tax
payable
|
25,743
|
27,792
|
4,484
|
Deferred
income
|
25,715
|
30,704
|
4,953
|
Total current
liabilities
|
608,758
|
615,825
|
99,343
|
|
|
|
|
Non-current
liabilities
|
|
|
|
Deferred
income
|
15,677
|
14,326
|
2,311
|
Deferred tax
liabilities
|
14,711
|
14,308
|
2,308
|
Other non-current
liabilities
|
43,326
|
43,498
|
7,017
|
Total non-current
liabilities
|
73,714
|
72,132
|
11,636
|
Total
liabilities
|
682,472
|
687,957
|
110,979
|
|
|
|
|
Shareholders'
equity
|
|
|
|
Share
capital
|
158
|
158
|
25
|
Additional paid-in
capital
|
640,341
|
640,341
|
103,297
|
Accumulated other
comprehensive loss
|
(41,746)
|
(41,740)
|
(6,733)
|
Retained
earnings
|
232,879
|
229,486
|
37,020
|
Total shareholders'
equity
|
831,632
|
828,245
|
133,609
|
|
|
|
|
Total liabilities
and shareholders' equity
|
1,514,104
|
1,516,202
|
244,588
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/china-nepstar-chain-drugstore-ltd-reports-first-quarter-2015-financial-results-300088150.html
SOURCE China Nepstar Chain Drugstore Ltd.