- Revenue rose by 28% to RMB670.4
million (US$97.4 million)
-
- Returned to profitability and net profit was
RMB12.9 million (US$1.9 million) -
ZHANGZHOU, China, May 18, 2017 /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 first quarter ended March
31, 2017.
Financial Highlights
First Quarter 2017:
- Revenue was RMB670.4 million
(US$97.4 million), up 28%
year-over-year
- Sales to the Chinese OEM market nearly doubled
year-over-year
- Sales of aluminum wheels increased by 159.1%
year-over-year
- Gross margin was 15.8%;
- Net profit and total comprehensive income for the period was
RMB12.9 million (US$1.9 million) with earnings per American
Depositary Share ("ADS") of RMB0.25
(US$0.04) compared with net loss and
total comprehensive loss of RMB2.9
million with loss per ADS of RMB0.06 in the first quarter of 2016.
Mr. Junqiu Gao, Deputy CEO and
Chief Sales and Marketing Officer of Zenix Auto, commented, "We are
excited to have generated strong top line growth in the first
quarter. After a number of years of weak market environment, we are
seeing the profound impact from replacement of old trucks. Our
tubeless steel wheel, industrial wheel and aluminum wheel products
all experienced different degrees of strong growths as the Chinese
economy resumed growths and government policy is geared toward
emission control and road safety."
Mr. Martin Cheung, CFO of Zenix
Auto, commented, "Our gross margin was affected by the higher steel
price during the first quarter. However, we expect to pass on the
cost inflation to our customers in the coming quarters. As we are
closely tracking collections on receivables, we are confident to
produce cash inflow in 2017."
2017 First Quarter Results
Revenue for the first quarter was RMB670.4 million (US$97.4
million) from RMB525.4 million
for the first quarter of 2016. The increase in revenue on a
year-over-year basis was mainly due to strong sale to the domestic
truck OEM driven by Chinese government enforcement against truck
overloading. The increase of total revenue was also attributable to
the higher price adjustment in response to the rising raw material
costs.
Sales to the Chinese OEM market increased by 99.9%
year-over-year to RMB347.6 million
(US$50.5 million) in the first
quarter of 2017 compared to RMB173.9
million in the same quarter of 2016. Total unit sales in the
OEM market increased by 38.2% year-over-year during the first
quarter of 2017.
Aftermarket sales in China
decreased by 9.9% year-over-year to RMB231.5
million (US$33.6 million) in
the first quarter of 2017 from RMB257.0
million in the first quarter of 2016. Total unit sales in
the aftermarket decreased by 31.4% year-over-year as the
aftermarket wheel segment remained weak.
International sales decreased by 3.5% year-over-year to
RMB91.2 million (US$13.3 million) in the first quarter of 2017
compared to sales of RMB94.5 million
in the first quarter of 2016. Total unit sales in the international
sales decreased by 15.0% year-over-year in the first quarter of
2017 mainly due to continued weak demand in Southeastern Asian
countries.
In the first quarter of 2017, domestic OEM sales, domestic
aftermarket sales and international sales contributed 51.9%, 34.5%
and 13.6% of revenue, respectively.
Sales of tubed steel wheels comprised 44.9% of 2017 first
quarter revenue compared to 54.8% in the same quarter in 2016.
Tubeless steel wheel sales represented 45.4% of 2017 first quarter
revenue compared to 38.2% in the same quarter of 2016. While tubed
and tubeless steel wheel sales remain the main sources of revenue
for the Company, sales of aluminum wheels increased by 159.1%
year-over-year and accounted for 5.8% first quarter revenue as
compared to 2.9% in the same quarter a year ago. The tightened
regulation by Chinese government to curb emissions and increase
road safety fueled high demand for light-weight tubeless and
aluminum wheels.
First quarter gross profit increased by 5.1% to RMB105.7 million (US$15.4
million), compared to RMB100.6
million in the same quarter in 2016. Gross margin was 15.8%,
compared with 19.1% in the first quarter of 2016. The decrease in
gross margin on a year-over-year basis was mainly due to the rise
of raw material cost. The Company raised selling prices during the
first quarter but they were not high enough to offset the increase
of the raw material costs.
Selling and distribution expenses decreased by 2.2% to
RMB42.4 million (US$6.2 million) from RMB43.4 million in the first quarter of 2016. The
decrease in selling and distribution costs was primarily due to
lower marketing and advertising expenses in the first quarter of
2017 compared with the same quarter last year. As a percentage of
revenue, selling and distribution costs were 6.3% in the first
quarter of 2017, compared to 8.3% in the same quarter a year
ago.
Research and development ("R&D") expenses decreased by 31.0%
to RMB14.0 million (US$2.0 million), compared to RMB20.3 million in the first quarter of 2016.
R&D as a percentage of revenue was 2.1% in the first quarter of
2017, compared to 3.9% in the same quarter a year ago. As the
Company's aluminum products continue to mature, R&D expenses
were lowered.
Administrative expenses decreased by 8.5% to RMB31.6 million (US$4.6
million) from RMB34.9 million
in the first quarter of 2016. As a percentage of revenue,
administrative expenses were 4.7%, compared to 6.6% of revenue in
the first quarter of 2016.
Net income and total comprehensive income were RMB12.9 million (US$1.9
million) in the first quarter of 2017 compared to net loss
and total comprehensive loss of RMB2.9
million for the first quarter of 2016.
Basic and diluted income per ADS were RMB0.25 (US$0.04)
in the first quarter of 2017 compared to basic and diluted loss per
ADS of RMB0.06 in the first quarter
of 2016.
In the first quarter of 2017, the Company recorded net cash
outflows from operating activities of RMB167.0 million (US$24.3
million). Higher sales to domestic OEM market increased
total account receivables which affected operating cash-flows.
However, Days Sales Outstanding (DSO) remained at 58 days in the
first quarter of 2017, flat in comparison with 60 days during the
full year of 2016. Capital expenditures for the purchase of
property, plant and equipment in the first quarter were
RMB 0.2 million (US$35,450).
During the first 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.
As of March 31, 2017, Zenix Auto
had bank balances and cash of RMB717.7
million (US$104.3 million) and
fixed bank deposits with a maturity period over three months of
RMB290.0 million (US$42.1 million). Total bank borrowings were
RMB558.0 million (US$81.1 million). Total equity attributable to
owners of the Company was RMB2,550.5
million (US$370.5
million).
Conference Call Information
The Company will host a conference call, to be simultaneously
webcast, on Thursday, May 18, 2017 at
8:00 a.m. ET/ 8:00 p.m. Beijing Time. Interested parties may
participate in the conference call by dialing +1-877-407-0782 (U.S.
Toll Free) or +1-201-689-8567 (International). Please dial in five
minutes before the call start time and ask to be connected to the
"China Zenix Auto" conference call.
A replay will be available shortly after the conclusion of the
conference call through June 18,
2017, at 11:59 p.m. ET.
Interested parties may access the replay by dialing +1-877-481-4010
(U.S. Toll Free) or +1-919-882-2331 (International) and using
Conference ID 10374 to access the replay.
Exchange Rate Information
The United States dollar (US$)
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 RMB6.883 to US$1.00, the effective noon buying rate as of
March 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 772 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 March 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
Investor Relations
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 March 31, 2017 and 2016
(RMB and US$ amounts expressed in thousands, except number of
shares and ADSs and per share data)
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
2016
|
|
2017
|
|
2017
|
|
|
RMB'
000
|
|
RMB'
000
|
|
US$'
000
|
Revenue
|
|
|
525,399
|
|
670,356
|
|
97,393
|
Cost of
sales
|
|
|
(424,846)
|
|
(564,640)
|
|
(82,034)
|
Gross
profit
|
|
|
100,553
|
|
105,716
|
|
15,359
|
Other operating
income
|
|
|
487
|
|
6,416
|
|
932
|
Net exchange
gain
|
|
|
(144)
|
|
(306)
|
|
(44)
|
Selling and
distribution costs
|
(43,404)
|
|
(42,435)
|
|
(6,165)
|
Research and
development expenses
|
(20,321)
|
|
(14,017)
|
|
(2,036)
|
Administrative
expenses
|
|
|
(34,551)
|
|
(31,621)
|
|
(4,594)
|
Finance
costs
|
|
|
(5,435)
|
|
(5,290)
|
|
(769)
|
(Loss) profit
before taxation
|
|
|
(2,815)
|
|
18,463
|
|
2,683
|
Income tax
expense
|
|
|
(95)
|
|
(5,546)
|
|
(806)
|
(Loss) profit and
total
comprehensive income
(loss) for the period
|
|
|
(2,910)
|
|
12,917
|
|
1,877
|
(Loss) earnings
per share
|
|
|
|
|
|
|
|
Basic
|
|
|
(0.01)
|
|
0.06
|
|
0.01
|
Diluted
|
|
|
(0.01)
|
|
0.06
|
|
0.01
|
(Loss) earnings
per ADS
|
|
|
|
|
|
|
|
Basic
|
|
|
(0.06)
|
|
0.25
|
|
0.04
|
Diluted
|
|
|
(0.06)
|
|
0.25
|
|
0.04
|
Shares
|
|
|
206,500,000
|
|
206,500,000
|
|
206,500,000
|
ADSs
|
|
|
51,625,000
|
|
51,625,000
|
|
51,625,000
|
China Zenix Auto
International Limited
Unaudited Condensed Consolidated Statements of Financial
Position
(RMB and US$ amounts expressed in thousands)
|
|
|
|
|
|
|
|
|
|
December 31,
2016
|
|
March
31,
2017
|
|
March 31,
2017
|
|
|
RMB'000
|
|
RMB'000
|
|
US$'000
|
ASSETS
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
|
|
|
Inventories
|
|
138,740
|
|
194,439
|
|
28,249
|
Trade and other
receivables and prepayments
|
|
695,856
|
|
895,030
|
|
130,035
|
Prepaid lease
payments
|
|
9,425
|
|
9,425
|
|
1,369
|
Pledged bank
deposits
|
|
32,100
|
|
36,690
|
|
5,331
|
Fixed bank deposits
with maturity period over
three months
|
|
290,000
|
|
290,000
|
|
42,133
|
Bank balances and
cash
|
|
896,799
|
|
717,727
|
|
104,275
|
Total current
assets
|
|
2,062,920
|
|
2,143,311
|
|
311,392
|
Non-Current
Assets
|
|
|
|
|
|
|
Property, plant and
equipment
|
|
1,379,287
|
|
1,342,945
|
|
195,109
|
Prepaid lease
payments
|
|
376,449
|
|
374,093
|
|
54,350
|
Deferred tax
assets
|
|
23,836
|
|
23,854
|
|
3,466
|
Intangible
assets
|
|
17,000
|
|
17,000
|
|
2,470
|
Total non-current
assets
|
|
1,796,572
|
|
1,757,892
|
|
255,395
|
Total
assets
|
|
3,859,492
|
|
3,901,203
|
|
566,787
|
|
|
|
|
|
|
|
EQUITY AND
LIABILITIES
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
|
|
|
Trade and other
payables and accruals
|
|
668,633
|
|
695,082
|
|
100,985
|
Amount due to a
shareholder
|
|
1,398
|
|
-
|
|
-
|
Taxation
payable
|
|
109
|
|
2,116
|
|
307
|
Short- term bank
borrowings
|
|
558,000
|
|
558,000
|
|
81,069
|
Total current
liabilities
|
|
1,228,140
|
|
1,255,198
|
|
182,361
|
Non-current
liabilities
|
|
|
|
|
|
|
Deferred tax
liabilities
|
|
85,286
|
|
87,222
|
|
12,672
|
Deferred
income
|
|
8,496
|
|
8,296
|
|
1,205
|
Total non-current
liabilities
|
|
93,782
|
|
95,518
|
|
13,877
|
Total
liabilities
|
|
1,321,922
|
|
1,350,716
|
|
196,238
|
EQUITY
|
|
|
|
|
|
|
Share
capital
|
|
136
|
|
136
|
|
20
|
Paid in
capital
|
|
392,076
|
|
392,076
|
|
56,963
|
Reserves
|
|
2,145,358
|
|
2,158,275
|
|
313,566
|
Total equity
attributable to owners of the company
|
|
2,537,570
|
|
2,550,487
|
|
370,549
|
Total equity and
liabilities
|
|
3,859,492
|
|
3,901,203
|
|
566,787
|
China Zenix Auto
International Limited
Unaudited Condensed Consolidated Statement of Cash Flows
For the three months ended March 31, 2017
(RMB and US$ amounts expressed in thousands)
|
|
|
|
|
|
|
OPERATING
ACTIVITIES
|
|
Three Months Ended
March 31, 2017
|
|
|
|
|
RMB'
000
|
|
US$'
000
|
|
Profit before
taxation
|
|
18,463
|
|
2,683
|
|
Adjustments
for:
|
|
|
|
|
|
|
Amortization of
prepaid lease payments
|
|
2,356
|
|
342
|
|
|
Depreciation of
property plant and equipment
|
|
37,050
|
|
5,383
|
|
|
Release of deferred
income
|
|
(200)
|
|
(29)
|
|
|
Finance
costs
|
|
5,290
|
|
768
|
|
|
Interest
income
|
|
(2,844)
|
|
(413)
|
|
|
Loss on disposal of
property, plant and equipment
|
15
|
|
2
|
|
Operating cash flows
before movements in working capital
|
60,130
|
|
8,736
|
|
Increase in
inventories
|
|
(55,699)
|
|
(8,092)
|
|
Increase in trade and
other receivables and prepayments
|
(201,604)
|
|
(29,290)
|
|
Increase in trade and
other payables and accruals
|
|
26,686
|
|
3,877
|
|
Cash generated from
operations
|
|
(170,487)
|
|
(24,769)
|
|
Interest
received
|
|
3,604
|
|
524
|
|
PRC income tax
paid
|
|
(109)
|
|
(16)
|
|
NET CASH USED IN
OPERATING ACTIVITIES
|
|
(166,992)
|
|
(24,261)
|
|
INVESTING
ACTIVITIES
|
|
|
|
|
|
Purchase of property,
plant and equipment
|
|
(244)
|
|
(35)
|
|
Placement of pledged
bank deposits
|
|
(4,590)
|
|
(667)
|
|
Proceeds on disposal
of property, plant and equipment
|
|
13
|
|
1
|
|
Placement of fixed
bank deposits with maturity periods over
three months
|
(240,000)
|
|
(34,869)
|
|
Withdrawal of fixed
bank deposits with maturity periods over
three months
|
240,000
|
|
34,869
|
|
NET CASH USED IN
INVESTING ACTIVITIES
|
|
(4,821)
|
|
(701)
|
|
FINANCING
ACTIVITIES
|
|
|
|
|
|
New bank borrowings
raised
|
|
255,000
|
|
37,048
|
|
Repayment of bank
borrowings
|
|
(255,000)
|
|
(37,048)
|
|
Interest
paid
|
|
(6,019)
|
|
(874)
|
|
Repayment to a
shareholder
|
|
(1,398)
|
|
(203)
|
|
NET CASH USED IN
FINANCING ACTIVITIES
|
|
(7,417)
|
|
(1,077)
|
|
NET DECREASE IN
CASH AND CASH EQUIVALENTS
|
|
(179,230)
|
|
(26,039)
|
|
Cash and cash
equivalents at beginning of the period
|
|
896,799
|
|
130,292
|
|
Effect of foreign
exchange rate changes
|
|
158
|
|
22
|
|
Cash and cash
equivalents at end of the period
|
|
717,727
|
|
104,275
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/china-zenix-auto-international-limited-reports-28-revenue-growth-in-2017-first-quarter-300459831.html
SOURCE China Zenix Auto International Limited