JINJIANG, China, April 30,
2018 /PRNewswire/ -- China Ceramics Co., Ltd. (NASDAQ
Capital Market: CCCL) ("China Ceramics" or the "Company"), a
leading Chinese manufacturer of ceramic tiles used for exterior
siding and for interior flooring and design in residential and
commercial buildings, today announced its financial results for the
second half and fiscal year ended December
31, 2017.
Operating results were affected by the following significant
items:
- In fiscal 2017, there were two separate price increases of the
Company's products by 10% each in April and July, respectively.
This followed a 20% reduction in the prices of our slow-moving
products beginning on October 1,
2016, that was instituted in an effort to convert some of
our inventory into cash
- Asset write-down attributable to the impairment of fixed assets
was RMB 36.7 million (US$ 5.5 million) for the six months ended
December 31, 2017 as compared to
RMB 230.4 million (US$ 34.1 million) attributable to the impairment
of fixed assets for the same period of
2016
- Provision for bad debt was RMB 71.6
million (US$ 10.8 million) for
the six months ended December 31,
2017 as compared to RMB 23.9
million (US$ 3.5 million) for
the same period of 2016
Second Half 2017 Summary
- Revenue was RMB 485.3 million
(US$ 73.2 million) for the six months
ended December 31, 2017, as compared
to RMB 453.1 million (US$ 66.4 million) for the same period of
2016.
- Gross profit was RMB 57.8 million
(US$ 8.7 million) for the six months
ended December 31, 2017, as compared
to a gross loss of RMB 80.3 million
(US$ 12.1 million) for the same
period of 2016.
- Net loss was RMB 82.2 million
(US$ 12.4 million) for the six months
ended December 31, 2017, as compared
to a net loss of RMB 351.3 million
(US$ 51.6 million) for the same
period of 2016.
- Loss per share on a basic and fully diluted basis were
RMB 24.29 (US$
3.66) for the six months ended December 31, 2017, as compared to loss per share
on a basic and fully diluted earnings per share of RMB 127.47 (US$
18.99) for the same period of
2016.
- Loss from asset devaluation resulting from an impairment of
fixed assets including land use rights was RMB 36.7 million (US$ 5.5
million) for the six months ended December 31, 2017, as compared to an impairment
of fixed assets of RMB 230.4 million
(US$ 34.3 million) for the same
period of 2016.
- Adjusted EBITDA (earnings (loss) before interest, taxes,
depreciation and amortization) was RMB 51.6
million (US$ 7.8 million) for
the six months ended December 31,
2017, adjusted for the write-off of fixed assets, land use
rights and bad debt expense, as compared to RMB 5.2 million (US$ 0.7
million), adjusted for the write-off of fixed assets and
slow-moving inventory for the same period of 2016.
Fiscal Year 2017 Summary
- Revenue was RMB 821.8 million
(US$ 121.7 million), as compared to
RMB 793.7 million (US$ 118.3 million) for fiscal year 2016.
- Gross profit was RMB 50.4 million
(US$ 7.5 million), as compared to a
gross loss of RMB 30.1 million
(US$ 4.5 million) for fiscal year
2016.
- Net loss was RMB 88.0 million
(US$ 13.0 million), as compared to a
net loss of RMB 321.8 million
(US$ 48.0 million) for fiscal year
2016.
- Loss per share on a basic and fully diluted basis were
RMB 26.36 (US$
3.90), as compared to basic and fully diluted earnings per
share of RMB 116.51 (US$ 17.36) for fiscal year 2016.
- Loss from asset devaluation resulting from an impairment of
fixed assets including land use rights was RMB 36.7 million (US$ 5.5
million) for fiscal 2017, as compared to an impairment of
fixed assets of RMB 230.4 million
(US$ 34.3 million) for fiscal
2016.
- Adjusted EBITDA (earnings before interest, taxes, depreciation
and amortization) was RMB 42.9
million (US$ 6.4 million),
adjusted for the write-off of fixed assets, land use rights and bad
debt expense, as compared to RMB 56.4
million (US$ 8.4 million),
adjusted for the write-off of fixed assets and slow-moving
inventory for fiscal year 2016.
"During the second half of 2017, we experienced slightly
improved market conditions as compared to the same period of 2016,
as we aggressively marketed our products utilizing a targeted
strategic approach. We were able to improve our pricing power due
to the popularity of our flagship porcelain ceramic tiles abetted
by our strong market presence. Our revenue rose 7.1% for the
second half of 2017 from the year-ago period primarily due to an
8.5% rise in our average selling price. In addition, our cash
flow was reasonably strong after adjusting for asset write-offs
during the year," said Mr. Jiadong
Huang, Chief Executive Officer of China Ceramics.
"For fiscal year 2017, we utilized production facilities capable
of producing 31 million square meters of ceramic tiles per year. Consistent with our practices in
past quarters, we maintained a reduced utilization of existing
plant capacity based on the current market environment to keep our
operating costs low. We intend to bring additional capacity online
as the business environment improves."
"For the remainder 2018, we are cautiously optimistic about an
improved business environment due to new land sales and continued
development activity as well as the government initiative to build
rental homes as a means of balancing China's urban residential dynamics. In the
long-term, we believe that real estate will continue to be vital to
China's economy and essential for
domestic growth. We plan to target those cities in
China that offer potential for new
property development and will continue to forge strong
relationships with larger property developers," concluded Mr.
Huang.
Six Month Results Ended December 31,
2017
Revenue for the six months ended December 31, 2017 was RMB
485.3 million (US$ 72.7
million), as compared to RMB 453.1
million (US$ 67.1 million) for
the same period of 2016. The 7.1% year-to-year increase in revenue
was due to (i) the 8.5% increase in our average selling price to
RMB 27.2 (US$
4.0) for the second six months of 2017 from RMB 25.1 (US $3.8)
for the same period of 2016, which was partially offset by (ii) the
1.2% decrease in the sales volume of ceramic tiles 17.9 million
square meters for the six months ended December 31, 2017 as compared to 18.1 million
square meters for the same period of 2016.
Gross profit for the six months ended December 31, 2017 was RMB
57.8 million (US$ 8.7
million), as compared to a gross loss of RMB 80.3 million (US$ 11.9
million) for the same period of 2016. The gross profit
margin was 11.9% as compared to a 17.7% gross loss margin for the
same period of 2016, where the latter period's gross loss margin
was due to (i) a significant decrease in the average selling price
due to price cuts to spur sales of slow-moving inventory, and (ii)
a RMB 59.4 million (US$ 8.9 million) write-off of inventory.
Other income for the six months ended December 31, 2017 was RMB
7.3 million ($1.1 million), as
compared to RMB 7.0 million
($1.0 million) for the same period of
2016. Other income is primarily comprised of rental income that the
Company received by leasing out one of its production lines from
its Hengdali facility pursuant to an eight-year lease contract.
Selling expenses for the six months ended December 31, 2017 were RMB
6.1 million (US$ 0.9 million),
as compared to RMB 5.8 million
(US$ 0.8 million) for the same period
of 2016. The decrease in selling expense was mainly due to a
decrease in adverting and travel expenses.
Administrative expenses for the six months ended
December 31, 2017 were RMB 79.8 million (US$ 12.0
million), as compared to RMB 35.0
million (US$ 5.2 million) the
same period of fiscal 2016. The increase in administrative expenses
was primarily due to the write-off of bad debt due to uncollectible
debt associated with our vendors.
Loss from asset devaluation resulting from an impairment
of non-current assets (fixed assets and land use rights) for the
six months ended December 31, 2017
was RMB 36.7 million (US$ 5.5 million) as compared to RMB 230.4 million (US$
34.3 million) for the same period of 2016. The loss from
asset devaluation resulted from an impairment of non-current assets
due to decelerating growth in China and an expected contraction in the
demand for the Company's products.
Other expenses for the six months ended December 31, 2017 were RMB
3.6 million (US$ 0.5 million),
as compared to RMB 6.9 million
(US$ 1.0 million) for the same period
of 2016. The reduction in other expenses is attributable to a
decreased loss on the disposal of fixed assets.
Net loss for the six months ended December 31, 2017 was RMB
82.2 million (US$ 12.4
million), as compared to a net loss of RMB 351.3 million (US$
52.4 million) for the same period of 2016. The decrease in
net loss was mainly due to increased gross profit and a lower loss
from asset devaluation for the six months ended December 31, 2017 as compared to the same period
of 2016.
Loss per basic share and fully diluted share for the six
months ended December 31, 2017 were
RMB 24.29 (US$
3.66), as compared to loss per basic and fully diluted share
of RMB 127.47 (US$ 18.99) for the same period of 2016.
Full Year 2017 Financial Results
Revenue for year ended December 31,
2017 was RMB 821.8 million
(US$ 121.7 million), as compared to
RMB 793.7 million (US$ 118.3 million) for the year ended
December 31, 2016. Gross profit was
RMB 50.4 million (US$ 7.5 million), as compared to gross loss of
RMB 30.1 million (US$ 4.5 million) for the same period of 2016. The
gross profit margin was a 6.1% as compared to a negative 3.8% gross
loss margin for the for the same period of 2016. Other income was
RMB 14.34 million (US$ 2.1 million), as compared to RMB 15.2 million (US$ 2.3
million) for the same period of 2016. Selling expenses were
RMB 12.0 million (US$ 1.8 million), as compared to RMB 12.8 million (US$ 1.9
million) for the same period of 2016. Administrative
expenses were RMB 88.8 million
(US$ 13.2 million), as compared to
RMB 46.7 million (US$ 7.0 million) for the same period of 2016.
Loss from asset devaluation resulting from an impairment of
non-current assets was RMB 36.7
million (US$ 5.4 million) as
compared to RMB 230.4 million
(US$ 34.3 million) for the same
period of 2016. Other expenses were RMB 5.24 million (US$ 0.8
million), as compared to RMB 11.4
million (US$ 1.7 million) in
the same period of 2016. Net loss for the twelve months ended
December 31, 2017 was RMB 88.0 million (US$ 13.0
million), as compared to a net loss of RMB 321.8 million (US$
48.0 million) for the same period of 2016. Loss per share on
a basic and fully diluted basis were RMB
26.36 (US$ 3.90) for
the fiscal year ended
December 31, 2017, as compared to
basic and fully diluted earnings per share of RMB 116.51 (US$
17.36), in the same period of 2016 (as adjusted for the one
for eight reverse stock split in June
2016.
Statements of Selected Financial Position Items for Fiscal
Year End 2017
- Cash and bank balances were RMB 2.3
million (US$ 0.4 million) as
of December 31, 2017, compared with
RMB 0.1 million (US$ 0.01 million) as of December 31, 2016.
- Inventory turnover was 95 days as of December 31, 2017, as compared to 108 days as of
December 31, 2016. We had a reversal
of inventory impairment of RMB 2.73
million in 2017 as a result of an improved inventory
turnover rate due to increased sales. Subsequent to the
RMB 75.1 million of inventory that
was impaired for the year ended December 31,
2016, we believe that the value of our current inventories
is realizable.
- Trade receivables turnover, net of value added tax, was 206
days as of December 31, 2017, as
compared with 209 days as of December 31,
2016, a slight decrease. This high trade receivables
turnover days was primarily due to a continued difficult economic
environment which has prompted us to offer extended credit terms to
certain customers resulting in a higher trade receivables turnover
figure than normal.
- Trade payables turnover, net of value added tax,
was 32 days as of December 31, 2017 compared with 51 days as of
December 31, 2016. The average
turnover days was within the normal credit period of one to four
months granted by our suppliers.
Liquidity and Capital Resources
Cash flow used in operating activities was RMB 3.6 million (US$ 0.5
million) for the six months ended December 31, 2017, as compared to cash used in
operating activities of RMB 4.6
million (US$ 0.7 million) for
the same period of 2016.
Cash flow used in investing activities was
RMB 0.6 million (US$ 9,000) for the six months ended December 31, 2017, as compared to cash flow
generated from investing activities of RMB 1.0 million
(US$ 0.2 million) mainly due
to the sale of fixed assets of RMB 1.07 million for the same period of
2016.
Cash flow generated from financing activities was
RMB 5.6 million (US$ 0.8 million) for the six months ended
December 31, 2017, compared to cash
flow used in financing activities of RMB 1.0 million (US$
0.2 million) primarily due to the
repayment of short-term loans for the same period of 2016.
Plant Capacity and Capital Expenditures Update
For the fiscal year ended
December 31, 2017, we utilized plant
capacity capable of producing 31 million square meters of ceramic
tiles annually out of a total effective annual production capacity
of 66 million square meters. Our Hengda facility now has an
annual production capacity of 37 million square meters of ceramic
tiles as a result of two old furnaces having been put out of use in
the facility; the Company utilized production capacity capable of
producing 9.6 million square meters of ceramic tiles for the six
months ended December 31, 2017 and
18.2 million square meters of ceramic tiles for the entire fiscal
year 2017. Our Hengdali facility has an annual production capacity
of 29 million square meters (not including the leasing out of 10
million square meters of production capacity to a third party) and
we utilized production capacity capable of producing 7.7 million
square meters of ceramic tiles for the six months ended
December 31, 2017 and 12.7 million
square meters of ceramic tiles for the entire fiscal year
2017. Our annual production capacity has been effectively
reduced from 72 million square
meters of ceramic tiles to 66 million square meters of ceramic
tiles due to an eight-year contract to lease out one of the
production lines from our Hengdali facility that we entered into in
March 2016. We will bring our unused production capacity
online as customer demand dictates and when there are signs of
improvement in China's real estate
and construction sector.
We incurred RMB 5.6 million
(US$ 0.9 million) in capital
expenditure attributable to the purchase of manufacturing and
production equipment (a kiln for RMB $4.9
million and a desulfurization tower for RMB 0.7 million) for the year ended December 31, 2017. We review the level of capital
expenditures throughout the year and make adjustments subject to
market conditions. Although business conditions are subject to
change, given the currently challenging market conditions we
anticipate a low level of capital expenditures for 2018 other than
those associated with minimal upgrades, small repairs and the
maintenance of equipment.
Business Outlook
In fiscal 2017, we increased the pricing of our ceramic tile
products by 10% each in April and July, respectively. This
followed a 20% reduction in the prices of our slow-moving products
beginning on October 1, 2016, that
was instituted in an effort to convert some of our inventory into
cash. Our renewed pricing strength in fiscal 2017 was
generally accepted by the marketplace as our fiscal 2017 sales
volume increased 10.6% from fiscal 2016.
Looking ahead to the remainder of 2018, we expect conditions to
slowly improve with a potential expansion in residential land
supply, which will ultimately result in real estate development,
especially in certain Tier 2 and Tier 3 cities. In addition,
the Chinese Government began a program to increase the development
of rental homes, affordable housing and housing co-owned by
individuals and the state to help stem real estate speculation.
There have also been efforts to develop rural land into rental
housing which could help to address housing shortages and stabilize
price increases in Tier 1 and Tier 2 cities. These initiatives
could lead to additional real estate development and help to offset
inventory declines in certain regions. In addition, local
governments have begun to go forward with construction projects
which has resulted in property investment growth. In the
long-term, we believe that the real estate sector continues to be
vital to sustaining China's strong
economic growth since it is an important component of China's GDP.
We typically receive orders from customers two months in advance
of production on a rolling basis. We enter into dealership
agreements with customers, and a sales or purchase contract each
time a customer places an order. As of December 31, 2017, our backlog was approximately
RMB 70.7 million (US$ 10.8 million), which represents approximately
the next two months of revenue. This as compares to a backlog
of approximately RMB 61.4 million
(US$ 8.9 million) as of December 31, 2016, a year-over-year increase of
15.1%. Under normal circumstances, our backlog is an indicator of
revenues that might be expected in the next quarter, though it is
subject to change due to unforeseen business conditions and events
including credit payment terms.
We operate as efficiently as possible, keeping our inventory
levels manageable, and we manufacture ceramic tiles consistent with
expected sales. We believe that our building materials sector
continues to have excess production capacity and that consolidation
will continue to occur. Competitive pressures over the last
three years has led to a contraction in our sector as many smaller
firms who lack our advanced manufacturing capabilities, ability to
conform to environmental standards and deep product platform have
exited the space.
We view the growth of the real estate sector and our building
materials sector as sustainable since China's urbanization, where the population
continues to shift from rural to urban areas, serves as its
foundation. In addition, urbanization is expected to lead to a more
consumption-driven economy, a key objective of government policy.
We have refocused our efforts to where we see active real estate
development and where property developers use our products as part
of their finished home products. We believe we have a competitive
advantage in our sector due to our comprehensive product platform,
customization capabilities, marketing expertise and strong
reputation. Our goal for the year ahead is to continue to
strategically penetrate regions with sound fundamentals and
generate sustainable sales volume consistent with current real
estate development trends.
Event Occurring After Fiscal Year 2017
On April 19, 2018, we sold an
aggregate of 770,299 common shares to certain individual investors
in a registered direct offering (the "Offering") at a price of US
$1.56 per share, the closing price of
the Company's common shares on the same date. The common shares
were issued pursuant to the Company's previously filed and
effective Registration Statement on Form F-3 that was declared
effective October 15, 2015. The
Company filed a prospectus supplement related to the Offering on
April 19, 2018. The gross proceeds to
the Company from the Offering, before deduction of offering
expenses, were approximately US $1.2
million. The Offering closed on April
24, 2018. Proceeds from the Offering shall be used for
working capital and general corporate purposes. There were no
discounts or brokerage fees associated with this Offering.
Conference Call Information
We will host a conference call at 8:00 am ET on Monday, April 30, 2018. Listeners may access the
call by dialing +1 (866) 627-0859 five to ten minutes prior to the
scheduled conference call time. International callers should dial
+1 (409) 350-3687. The conference participant pass code is 5692928.
A replay of the conference call will be available for 14 days
starting from 11:00 am ET on
April 30, 2018. To access the replay,
dial +1 (855) 859-2056. International callers should dial +1 (404)
537-3406. The pass code is 5692928 for the replay.
About China Ceramics Co., Ltd.
China Ceramics Co., Ltd. is a leading manufacturer of ceramic
tiles in China. The Company's
ceramic tiles are used for exterior siding, interior flooring, and
design in residential and commercial buildings. China Ceramics'
products, sold under the "Hengda" or "HD", "Hengdali" or "HDL", the
"TOERTO" and "WULIQIAO" brands, and the "Pottery Capital of Tang
Dynasty" brands, are available in over 2,000 style, color and size
combinations and are distributed through a network of exclusive
distributors as well as directly to large property developers. For
more information, please visit http://www.cceramics.com.
Currency Convenience Translation
The Company's financial information is stated in Renminbi
("RMB"). Translations of amounts from RMB into United States dollars ("US$") in this earnings
release are solely for the convenience of the readers and were
calculated at the rate of US$1.00 =
RMB 6.53. The exchange rate refers to
the historical rate as set forth in the H.10 statistical release
published by www.federalreserve.gov on December 29, 2017. Such translations should not
be construed as representations that RMB amounts could have been,
or could be, converted realized or settled into US$ at that rate on
December 31, 2017 or any other
rate.
Safe Harbor Statement
Certain of the statements made in this press release are
"forward-looking statements" within the meaning and protections of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements include statements with respect to our
beliefs, plans, objectives, goals, expectations, anticipations,
assumptions, estimates, intentions, and future performance, and
involve known and unknown risks, uncertainties and other factors,
which may be beyond our control, and which may cause the actual
results, performance, capital, ownership or achievements of the
Company to be materially different from future results, performance
or achievements expressed or implied by such forward-looking
statements. Forward-looking statements in this press release
include, without limitation, the continued stable macroeconomic
environment in the PRC, the PRC real estate and construction
sectors continuing to exhibit sound long-term fundamentals, our
ability to bring additional capacity online going forward as our
business improves, our customers continuing to adjust to our
product price increases, our ability to sustain our average selling
price increases and to continue to build volume in the quarters
ahead, and whether our enhanced marketing efforts will help to
produce wider customer acceptance of the new price points. All
statements other than statements of historical fact are statements
that could be forward-looking statements. You can identify these
forward-looking statements through our use of words such as "may,"
"will," "anticipate," "assume," "should," "indicate," "would,"
"believe," "contemplate," "expect," "estimate," "continue," "plan,"
"point to," "project," "could," "intend," "target" and other
similar words and expressions of the future.
All written or oral forward-looking statements attributable
to us are expressly qualified in their entirety by this cautionary
notice, including, without limitation, those risks and
uncertainties described in our annual report on Form 20-F for the
year ended December 31, 2017 and
otherwise in our SEC reports and filings. Such reports are
available upon request from the Company, or from the Securities and
Exchange Commission, including through the SEC's Internet website
at http://www.sec.gov. We have no obligation and do not undertake
to update, revise or correct any of the forward-looking statements
after the date hereof, or after the respective dates on which any
such statements otherwise are made.
NON-GAAP FINANCIAL MEASURES
This press release contains financial measures and guidance
which are considered "non-GAAP" financial measures under applicable
SEC rules and regulations. As described below, the Company's
management believes that in order to properly understand its
short-term and long-term financial trends, including period over
period comparisons of the Company's operations, investors may find
it useful to exclude the effect of certain charges or gains that
contribute to or reduce earnings but that result from transactions
or events that management believes may or may not recur with
similar materiality or impact to operations in future periods. The
Company generally uses such measures to facilitate management's
review of the operational performance of the Company. For more
detail on these measures and reconciliation of such measure to the
most comparable IFRS financial measures, please refer to page 12 of
this release.
FINANCIAL TABLES
CHINA CERAMICS
CO., LTD AND ITS SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF FINANCIAL POSITION
|
|
|
|
|
|
|
|
|
As of December
31,
|
|
2017
|
|
2016
|
|
USD'000
|
|
RMB'000
|
|
RMB'000
|
|
|
|
|
|
|
ASSETS AND
LIABILITIES
|
|
|
|
|
|
NONCURRENT
ASSETS
|
|
|
|
|
|
Property
and equipment, net
|
13,363
|
|
87,316
|
|
130,542
|
Investment property, net
|
764
|
|
4,994
|
|
6,791
|
Land use
rights, net
|
668
|
|
4,364
|
|
5,920
|
Goodwill
|
-
|
|
-
|
|
-
|
Deferred
tax assets
|
32
|
|
209
|
|
4,765
|
Long-term prepaid expense
|
-
|
|
-
|
|
1,494
|
Total noncurrent
assets
|
14,827
|
|
96,883
|
|
149,512
|
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
Inventories, net
|
29,334
|
|
191,667
|
|
212,742
|
Trade
receivables, net
|
81,473
|
|
532,361
|
|
553,542
|
Other
receivables and prepayments
|
329
|
|
2,152
|
|
8,854
|
Income
tax refundable
|
4
|
|
27
|
|
6,521
|
Cash and
bank balances
|
356
|
|
2,328
|
|
110
|
Total current
assets
|
111,496
|
|
728,535
|
|
781,769
|
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
Trade
payables
|
9,348
|
|
61,084
|
|
84,257
|
Accrued
liabilities and other payables
|
4,549
|
|
29,719
|
|
37,640
|
Amounts
owned to related parties
|
5,512
|
|
36,017
|
|
35,626
|
Income
tax payable
|
591
|
|
3,862
|
|
1,309
|
Total current
liabilities
|
20,000
|
|
130,682
|
|
158,832
|
|
|
|
|
|
|
NET CURRENT
ASSETS
|
91,496
|
|
597,853
|
|
622,937
|
|
|
|
|
|
|
NET ASSETS
|
106,323
|
|
694,736
|
|
772,449
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
Share
capital
|
32
|
|
206
|
|
151
|
Reserves
|
106,291
|
|
694,530
|
|
772,298
|
Total stockholders' equity
|
106,323
|
|
694,736
|
|
772,449
|
CHINA CERAMICS
CO., LTD AND ITS SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE LOSS
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Six months
ended December 31,
|
|
2017
|
|
2016
|
|
USD'000
|
|
RMB'000
|
|
RMB'000
|
|
|
|
|
|
|
Net sales
|
73,128
|
|
485,342
|
|
453,116
|
|
|
|
|
|
|
Cost of goods
sold
|
64,425
|
|
427,579
|
|
533,461
|
|
|
|
|
|
|
Gross profit
(loss)
|
8,703
|
|
57,763
|
|
(80,345)
|
|
|
|
|
|
|
Other
income
|
1,098
|
|
7,284
|
|
7,031
|
Selling and
distribution expenses
|
(923)
|
|
(6,127)
|
|
(5,798)
|
Administrative
expenses
|
(12,023)
|
|
(79,797)
|
|
(34,937)
|
Finance
costs
|
1
|
|
4
|
|
651
|
Loss from asset
devaluation
|
(5,528)
|
|
(36,683)
|
|
(230,359)
|
Other
expenses
|
(546)
|
|
(3,624)
|
|
(6,943)
|
|
|
|
|
|
|
Loss before
taxation
|
(9,218)
|
|
(61,180)
|
|
(350,700)
|
|
|
|
|
|
|
Income tax (expense)
credit
|
(3,167)
|
|
(21,017)
|
|
(597)
|
|
|
|
|
|
|
Loss attributable to
shareholders
|
(12,385)
|
|
(82,197)
|
|
(351,297)
|
|
|
|
|
|
|
Loss per
share
|
|
|
|
|
|
|
|
|
|
|
|
Basic
(RMB)
|
(3.66)
|
|
(24.29)
|
|
(127.47)
|
Diluted
(RMB)
|
(3.66)
|
|
(24.29)
|
|
(127.47)
|
CHINA CERAMICS
CO., LTD. AND ITS SUBSIDIARIES
|
SALES VOLUME
AND AVERAGE SELLING PRICE (UNAUDITED)
|
|
|
|
|
Six months
ended December 31,
|
|
2016
|
2017
|
Sales volume
(square meters)
|
18,090,713
|
17,862,005
|
Average Selling
Price (in RMB/square meter)
|
25.05
|
27.17
|
CHINA CERAMICS
CO., LTD AND ITS SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE LOSS
|
|
|
|
|
|
|
|
For the Years
ended December 31,
|
|
2017
|
2016
|
|
USD'000
|
|
RMB'000
|
RMB'000
|
|
|
|
|
|
Net
sales
|
121,715
|
|
821,792
|
793,745
|
|
|
|
|
|
Cost of goods
sold
|
114,257
|
|
771,438
|
23,856
|
|
|
|
|
|
Gross profit
(loss)
|
7,458
|
|
50,354
|
(30,111)
|
|
|
|
|
|
Other
income
|
2,135
|
|
14,253
|
15,233
|
Selling and
distribution expenses
|
(1,772)
|
|
(11,962)
|
(12,815)
|
Administrative
expenses
|
(13,154)
|
|
(88,814)
|
(46,704)
|
Finance
costs
|
(32)
|
|
(213)
|
(84)
|
Loss from asset
devaluation
|
(5,433)
|
|
(36,683)
|
(230,359)
|
Other
expenses
|
(797)
|
|
(5,220)
|
(11,381)
|
|
|
|
|
|
Loss before
taxation
|
(11,595)
|
|
(78,285)
|
(316,221)
|
|
|
|
|
|
Income tax
expense
|
(1,443)
|
|
(9,741)
|
(5,581)
|
|
|
|
|
|
Loss attributable
to shareholders
|
(13.038)
|
|
(88,026)
|
(321,802)
|
|
|
|
|
|
Loss per
share
|
|
|
|
|
|
|
|
|
|
Basic
(RMB)
|
(3.90)
|
|
(26.36)
|
(116.51)
|
Diluted
(RMB)
|
(3.90)
|
|
(26.36)
|
(116.51)
|
CHINA CERAMICS
CO., LTD. AND ITS SUBSIDIARIES
|
|
SALES VOLUME AND
AVERAGE SELLING PRICE (UNAUDITED)
|
|
|
|
|
Years ended
December 31,
|
|
2016
|
|
2017
|
|
|
|
|
Sales volume (square
meters)
|
28,803,657
|
|
31,859,801
|
Average Selling Price
(in RMB/square meter)
|
27.55
|
|
25.79
|
|
|
|
|
|
CHINA CERAMICS
CO., LTD AND ITS SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
December 31,
|
|
2017
|
|
2016
|
|
USD'000
|
RMB'000
|
|
RMB'000
|
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
|
Loss before taxation
|
(9,218)
|
(61,180)
|
|
(350,700)
|
Adjustments for
|
|
|
|
|
Amortization of land use rights
|
11
|
72
|
|
183
|
Depreciation of property, plant and equipment
|
1,081
|
7,173
|
|
22,191
|
(Gain) loss on disposal of property, plant and equipment
|
(4)
|
(27)
|
|
6,246
|
Bad debt provision of trade receivables
|
10,783
|
71,565
|
|
23,940
|
Write down of inventories
|
(412)
|
(2,733)
|
|
76,282
|
Impairment of non-current assets
|
5,527
|
36,683
|
|
230,359
|
Share based compensation
|
44
|
294
|
|
-
|
Finance costs
|
(33)
|
(219)
|
|
(2,577)
|
Interest expense (income)
|
31
|
206
|
|
(1,838)
|
Operating cash flows before working capital changes
|
7,810
|
51,834
|
|
7,762
|
Increase in inventories
|
951
|
6,308
|
|
(17,204)
|
Decrease (Increase) in trade receivables
|
(6,144)
|
(40,775)
|
|
49,279
|
Increase (Decrease)
in other receivables, tax receivable and prepayments
|
1,935
|
12,845
|
|
4,166
|
Decrease in trade
payable
|
(4,504)
|
(29,891)
|
|
(45,935)
|
Decrease (increase)
in accrued liabilities, other payables and amounts owned to related
parties
|
(593)
|
(3,939)
|
|
3,123
|
Cash generated from (used in) operations
|
(545)
|
(3,618)
|
|
1,191
|
Interest paid
|
-
|
-
|
|
702
|
Income tax paid
|
-
|
-
|
|
(6,462)
|
|
|
|
|
|
Net cash generated
from (used in) operating activities
|
(545)
|
(3,618)
|
|
(4,569)
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
|
Acquisition of fixed assets
|
(9)
|
(62)
|
|
-
|
Proceeds from
disposal of property, plant and equipment
|
-
|
-
|
|
1,000
|
Decrease (Increase) in restricted cash
|
-
|
-
|
|
-
|
Interest received
|
-
|
-
|
|
37
|
|
|
|
|
|
Net cash generated from (used in) investing activities
|
(9)
|
(62)
|
|
1,037
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
|
Insurance of share capital
|
841
|
5,581
|
|
(1,056)
|
|
|
|
|
|
Net
cash generated from (used in) financing activities
|
841
|
5,581
|
|
(1,037)
|
|
|
|
|
|
NET INCREASE IN
CASH & EQUIVALENTS
|
287
|
1,901
|
|
(2,465)
|
CASH &
EQUIVALENTS, BEGINNING OF PERIOD
|
-
|
-
|
|
-
|
EFFECT OF FOREIGN
EXCHANGE RATE DIFFERENCES
|
39
|
260
|
|
(738)
|
|
|
|
|
|
CASH &
EQUIVALENTS, END OF YEAR
|
326
|
2,161
|
|
110
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHINA CERAMICS
CO., LTD AND ITS SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
For the years
ended December 31,
|
|
|
|
2017
|
|
2016
|
|
USD'000
|
|
RMB'000
|
|
RMB'000
|
|
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
|
|
Loss before taxation
|
(11,595)
|
|
(78,285)
|
|
(316,221)
|
Adjustments for
|
|
|
|
|
|
Amortization of land
use rights
|
21
|
|
143
|
|
369
|
Depreciation of
property, plant and equipment
|
2,277
|
|
15,371
|
|
44,583
|
(Gain) loss on
disposal of property, plant and equipment
|
(10)
|
|
(70)
|
|
6,246
|
Bad debt provision of
trade receivables
|
10,599
|
|
71,565
|
|
23,940
|
Write down of
inventories
|
(405)
|
|
(2,733)
|
|
75,078
|
Impairment of
non-current assets
|
5,433
|
|
36,683
|
|
230,359
|
Share based
compensation
|
44
|
|
294
|
|
-
|
Finance
costs
|
-
|
|
-
|
|
-
|
Interest expense
(income)
|
30
|
|
206
|
|
(1,791)
|
Foreign exchange
loss
|
-
|
|
-
|
|
84
|
Operating cash
flows before working capital changes
|
6,394
|
|
43,174
|
|
62,647
|
Increase in
inventories
|
3,526
|
|
23,808
|
|
19,034
|
Decrease (Increase)
in trade receivables
|
(7,462)
|
|
(50,384)
|
|
(67,578)
|
Increase (Decrease)
in other receivables, tax receivable and prepayments
|
1,786
|
|
12,058
|
|
8,481
|
Decrease in trade
payable
|
(3,432)
|
|
(23,173)
|
|
(26,010)
|
Decrease (increase)
in accrued liabilities, other payables and amounts owned to related
parties
|
(1,115)
|
|
(7,529)
|
|
7,641
|
Cash generated from
(used in) operations
|
(303)
|
|
(2,046)
|
|
4,215
|
Interest
paid
|
-
|
|
-
|
|
(84)
|
Income tax
paid
|
-
|
|
-
|
|
(12,816)
|
|
|
|
|
|
|
Net cash generated
from (used in) operating activities
|
(303)
|
|
(2,046)
|
|
(8,685)
|
|
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
|
|
Acquisition of fixed
assets
|
(832)
|
|
(5,618)
|
|
-
|
Proceed from disposal
of property, plant and equipment
|
10
|
|
70
|
|
1,000
|
Decrease (Increase)
in restricted cash
|
-
|
|
-
|
|
41,672
|
Interest
received
|
-
|
|
-
|
|
1,791
|
|
|
|
|
|
|
Net cash generated
from (used in) investing activities
|
(822)
|
|
(5,548)
|
|
44,463
|
|
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
|
|
Insurance of share
capital
|
1,413
|
|
9,537
|
|
6,185
|
Repayment of
short-term loans
|
-
|
|
-
|
|
(40,076)
|
|
|
|
|
|
|
Net cash generated
from (used in) financing activities
|
1,413
|
|
9,537
|
|
(33,891)
|
|
|
|
|
|
|
NET INCREASE IN
CASH & EQUIVALENTS
|
288
|
|
1,943
|
|
1,887
|
CASH &
EQUIVALENTS, BEGINNING OF YEAR
|
16
|
|
110
|
|
514
|
EFFECT OF FOREIGN
EXCHANGE RATE DIFFERENCES
|
41
|
|
275
|
|
(2,291)
|
|
|
|
|
|
|
CASH &
EQUIVALENTS, END OF YEAR
|
345
|
|
2,328
|
|
110
|
About Non-GAAP Financial Measures
In addition to China Ceramics' condensed consolidation financial
results under International Financial Reporting Standards ("IFRS"),
the Company also provides certain non-IFRS financial measures
(referred to as the "non-GAAP financial measures") for the second
half and full fiscal years ending December
31, 2016 and December 31,
2017, respectively, from their comparable IFRS measures.
Such non-GAAP financial measures are offered to supplement the
Company's audited financial statements, this earnings release and
the accompanying tables and include EBITDA and Adjusted EBITDA.
EBITDA is calculated as earnings before interest, tax,
depreciation and amortization (EBITDA). Adjusted EBITDA is
calculated as EBITDA less loss from asset devaluation, inventory
write-down and bad debt expense. Both are measures of the Company's
operating performance.
The Company uses these non-GAAP financial measures internally in
analyzing its financial results and believes they are useful to
investors in evaluating the Company's ongoing operational
performance. In addition, the Company believes that these non-GAAP
financial measures provide investors with other methods for
assessing China Ceramics' operating results in a manner that is
focused on the performance of its ongoing operations. Readers are
cautioned not to view non-GAAP financial measures on a stand-alone
basis or as a substitute for results under IFRS, or as being
comparable to results reported or forecasted by other companies,
and should refer to the unaudited reconciliation presented below.
The Company has provided a reconciliation of these non-GAAP
financial measures to the most directly comparable IFRS financial
measure below as adjusted for the periods indicated:
CHINA CERAMICS
CO., LTD.
|
Unaudited Reconciliation
of GAAP to Non-GAAP: Net Income to EBITDA (1)
|
Six months ended
December 31, 2017 and December 31, 2016
|
(all figures in
000's)
|
|
|
2017
|
|
2016
|
|
RMB
|
USD
|
|
RMB
|
USD
|
Net
loss
|
(82,197)
|
(12,385)
|
|
(351,297)
|
(52,421)
|
Interest
expense
|
4
|
1
|
|
(702)
|
(109)
|
Interest
income
|
(32)
|
(5)
|
|
(37)
|
3
|
Income tax
expense
|
21,017
|
3,167
|
|
5,533
|
814
|
Depreciation
and amortization expense
|
7,245
|
1,092
|
|
22,374
|
3,292
|
EBITDA
|
(53,963)
|
(8,130)
|
|
(324,129)
|
(48,421)
|
Loss from asset
devaluation (2)
|
36,683
|
5,527
|
|
230,359
|
34,124
|
Inventory
write-down (3)
|
(2,733)
|
(412)
|
|
75,078
|
11,259
|
Bad debt
expense (4)
|
71,565
|
10,783
|
|
23,940
|
3,546
|
Adjusted
EBITDA
|
51,552
|
7,768
|
|
5,248
|
508
|
(1) EBITDA is
defined as earnings before interest, taxes, depreciation and
amortization
(2)
Non-cash write-down of fixed assets and land use rights
for the second six months of fiscal 2017; non-cash write down of
fixed assets for the second six months of fiscal
2016
(3)
Non-cash inventory write-down
(4)
Non-cash write-off of bad debt expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHINA CERAMICS
CO., LTD.
|
Unaudited
Reconciliation of GAAP to Non-GAAP: Net Income to Adjusted EBITDA
(1)
|
Years ended
December 31, 2017 and December 31, 2016
|
(all figures in
000's)
|
|
|
|
|
|
|
|
2017
|
|
2016
|
|
RMB
|
USD
|
|
RMB
|
USD
|
Net
loss
|
(88,026)
|
(13,038)
|
|
(321,802)
|
(47,957)
|
Interest
expense
|
213
|
32
|
|
84
|
13
|
Interest
income
|
(32)
|
(5)
|
|
(1,791)
|
(269)
|
Income tax
expense
|
9,741
|
1,443
|
|
5,581
|
832
|
Depreciation
and amortization expense
|
15,514
|
2,298
|
|
44,951
|
6,740
|
EBITDA
|
(62,590)
|
(9,270)
|
|
(272,977)
|
(40,641)
|
Loss from asset
devaluation (2)
|
36,683
|
5,433
|
|
230,359
|
34,329
|
Inventory
write-down (reversal) (3)
|
(2,733)
|
(405)
|
|
75,078
|
11,259
|
Bad debt
expense (4)
|
71,565
|
10,599
|
|
23,940
|
3,491
|
Adjusted
EBITDA
|
42,925
|
6,357
|
|
56,400
|
8,438
|
|
(1) EBITDA is
defined as earnings before interest, taxes, depreciation and
amortization
(2)
Non-cash write-down of fixed assets and land use rights
in fiscal 2017; non-cash write down of fixed assets in fiscal
2016
(3)
Non-cash inventory write-down
(4)
Non-cash write-off of bad debt expense
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
View original
content:http://www.prnewswire.com/news-releases/china-ceramics-announces-second-half-and-full-year-financial-results-for-fiscal-2017-300638622.html
SOURCE China Ceramics Co., Ltd.