Reports 43% and 42% Increase in Revenue and
Gross Profit, Respectively
Expects Strong Growth to Continue in the
Second Half of 2018
BEIJING, Sept. 17, 2018 /PRNewswire/ -- China Internet
Nationwide Financial Services Inc. (NASDAQ: CIFS) ("CIFS" or the
"Company"), a financial advisory service and FinTech company, today
announced its unaudited financial results for the six-month period
ended June 30, 2018.
Financial Highlights – First Half 2018 vs.
First Half 2017
In
$
|
6M Ended
June 30, 2018
|
6M Ended
June 30, 2017
|
Change
%
|
Total
revenue
|
11,419,246
|
7,973,214
|
+43%
|
Gross
profit
|
11,040,370
|
7,790,700
|
+42%
|
Operating
expenses
|
7,731,997
|
638,155
|
+1112%
|
Income from
operations (1)
|
3,308,373
|
7,152,545
|
-54%
|
Net income
(2)
|
6,850,140
|
8,239,154
|
-17%
|
Basic and diluted
earnings per share (3)
|
0.31
|
0.41
|
-24%
|
|
(1) Income from
operations for the six-month period ended June 30, 2018 includes
approximately $7,731,997 of SG&A and R&D expenses as
compared to 638,155 for the same period of last
year.
(2) Net income for
the six-month periods ended June 30, 2018 and June 30, 2017 include
approximately $6,577,824 and $8,586,456 of income before income tax
expenses, respectively.
(3) Basic and
diluted earnings per share for the six-month period ended June 30,
2018 is calculated based on approximately 11% more shares
outstanding (22,114,188) as compared to shares outstanding
(20,000,000) on June 30, 2017.
|
Jianxin Lin, Chairman and Chief
Executive Officer of CIFS, commented, "Benefiting from the
continuing growth of China's
economy and strong demand for our services by the underserved small
and medium sized enterprises, we achieved a 43% revenue growth in
the first half of 2018 as compared to first half of 2017, mainly
due to an increase in the total amount of financing advised and
higher number of clients advised/served."
We expect the second half of the year to be much stronger than
the first half of 2018 in terms of revenue as our new FinTech
initiatives will start generating results. We expect our three new
business lines to encompass between 30% to 35% of our total revenue
for full year 2018, and FinTech to become the catalyst for our
growth in 2019 and beyond. Furthermore, we expect our traditional
business to continue to grow at rates similar to previous reporting
periods."
Revenue
Breakdown - in $ million
|
6M Ended
June 30, 2018
|
6M Ended
June 30, 2017
|
%
Change
|
International
corporate financing advisory services
|
1.15
|
0.76
|
+51%
|
Intermediary bank
advisory services
|
5.43
|
2.07
|
+162%
|
Commercial Payment
Advisory services
|
4.72
|
5.14
|
-8%
|
Factoring
services
|
.07
|
-
|
NA
|
Technical
services
|
.04
|
-
|
NA
|
Total
revenue
|
11.42
|
7.97
|
+43%
|
In
$ million
|
6M Ended
June 30, 2018
|
6M Ended
June 30, 2017
|
%
Change
|
Amount of
financing advised
|
991
|
764
|
+30%
|
Commercial Payment
|
403
|
454
|
-11%
|
International Corporate Financing
|
300
|
200
|
+50%
|
Intermediary Loan
|
288
|
110
|
+162%
|
Amount of
factoring financing provided
|
2
|
-
|
NA
|
Total Amount
Financed
|
993
|
764
|
+30%
|
|
6M Ended
June 30, 2018
|
6M Ended
June 30, 2017
|
Change
|
Number of clients
advised (4)
|
39
|
15
|
+24
|
Commercial Payment
|
22
|
9
|
+13
|
International Corporate Financing
|
2
|
2
|
0
|
Intermediary Loan
|
15
|
4
|
+11
|
Number of
Factoring clients served
|
2
|
-
|
+2
|
Total Number of
Clients
|
41
|
15
|
+26
|
|
(4) The number of clients
for a specified period represents the number of clients whose
financing were funded during such period.
|
Operating margin, or income from operations as a percentage of
total revenue, was 29.0% and 89.7% for the six months ended
June 30, 2018 and 2017, respectively.
This decrease was primarily due to the increase in staffing costs
mainly as a result of higher headcount (183 employees at
June 30, 2018 as compared to only 32
at June 30, 2017), higher rental
expenses (6 offices / locations at June 30,
2018 as compared to two offices at June 30, 2017), and strategic investments in the
research and development of FinTech. Specifically:
- Our general and administrative expenses for the first half of
2018, increased to $5.5 million or
48% of total revenue, as compared to 8% in the same period of last
year, mainly due to higher headcount.
- Additionally, we made the strategic decision to invest in
research and development to expand our finance technology
infrastructure and products, thus our R&D expenses for the
first half of 2018 were $1.6 million
as compared to zero in the same period of 2017. Of note, our
R&D department currently employs approximately 100 people.
- In the first half of 2018, we recorded a one-time consulting
and service fee of $1.7 million in
connection with the engagement of legal and accounting professional
services.
These investments in R&D are in line with our strategy of
transforming the company from a traditional financial service
provider to a FinTech company thus we expect to continue to make
substantial investments in new technologies and talented IT
professionals to support the development of FinTech products and
services. As part of this strategy, in July
2018 we signed an agreement with Tsinghua University to
establish an Industry Trusted Blockchain Application Technology
Joint Research Center aiming to explore industry-specific products/
services for enterprises and individuals.
FinTech products include the development of big data platform by
offering data access, analytics, artificial intelligence, machine
learning, and intelligent investment research to clients such as
SMEs, state-owned enterprises, financial institutions and
individuals.
As previously announced, we have set up three new business lines
as follows:
(i) Supply Chain Financing
Services ("Factoring") was launched in October 2017, provides supply chain financing
solutions to SMEs – with an initial focus on the pharmaceutical
(medical supplies and equipment) sector by reducing financing costs
and improving operational efficiency. Since then, CIFS signed
several revolving factoring credit facility agreements
including:
a. A RMB
100 million (approximately $15.7 million) agreement
with Sino Pharma Business Factoring Co., Ltd, one of China's leading factoring services providers
serving the healthcare industry, backed by accounts receivable from
Grade A hospitals with Class II or above rankings.
b. A RMB
100 million (approximately $15.7 million) agreement
with CNBM Technology Corporation Limited ("CNBMTC"), a subsidiary
of China National Building Materials Group Co., Ltd., with
multiple-year extension options and backed by CNBMTC's accounts
receivable.
(ii) Big Data Analysis & AI
Services: In November 2017, we
acquired Beijing Anytrust Science & Technology Co., Ltd
("AnyTrust"). In early 2018, Anytrust launched the beta
version of AnyInfo, a vertical search engine and big data platform
covering a broad range of publicly available data of over 30
million enterprises in China. By
cleaning, integrating, analyzing, digging massive data and
artificial intelligence technology, this platform enables users to
view and download integrated / standardized enterprise's profiles
(including financial & operational data, and risk
notification). Users can also sign up for intelligence
notifications and produce customized intelligence reports.
(iii) Intelligent Investment
Research Services: Our Intelligent Research Platform
("IRP") which we launched in April
2018, provides intelligent financial products and services
to financial institutions such as banks, insurance and asset
management firms and investment funds in China. The IRP encompasses five product lines
including macroeconomics, asset allocation, fixed income, equity
investment, fund investment. Three product lines including
macroeconomics, asset allocation, fixed income which were
officially released before June 30,
2018 are currently being used by several main-stream banks
and mutual funds on a free-trail basis.
Mr. Lin concluded, "We are very pleased with the progress made
to date for our FinTech strategy. Our products and services
are tailored to support businesses in solving investment and
financial challenges as well as enterprise risk control. Not
only are we offering a wide range of products and services to
existing clients, but we are also targeting a whole new group of
potential clients such as financial institutions, banks and mutual
funds, located in a larger geographic region."
For more information contact:
Investor Relations
(China)
China Internet
Nationwide Financial Services, Inc.
ir@cifsp.com
+1 212
220-6998
|
Investor Relations
Service (US)
Lena Cati:
ir.us@cifsp.com
+1 212
836-9611
|
About China Internet Nationwide Financial Services
Inc.
Incorporated in 2014, China Internet Nationwide Financial
Services Inc. (NASDAQ: CIFS) commenced its business by providing
financial advisory services to small and medium size companies
("SMEs"). The traditional business segments include commercial
payment advisory, intermediary bank loan advisory and international
corporate financing advisory services which help clients to meet
their commercial payment and investment needs. In late 2017,
the Company made a strategic decision to transition into a FinTech
company by providing clients with creative financial services,
FinTech products and industry solutions leveraging big data and AI,
aiming to help clients to reduce financing costs, lower financing
risks and improve operating efficiency. Currently its FinTech
business includes three segments: Supply Chain Financing, Big Data
Analysis & AI Reports, and Intelligent Investment Research. For
more information, please visit its website www.cifsp.com.
Forward Looking Statements
This news release contains "forward-looking statements" within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and 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. All statements other than statements of historical fact
in this press release are forward-looking statements and involve
certain risks and uncertainties that could cause actual results to
differ materially from those in the forward-looking statements.
These forward-looking statements are based on management's current
expectations, assumptions, estimates and projections about the
Company and the industry in which the Company operates, but involve
a number of unknown risks and uncertainties, Further information
regarding these and other risks is included in the Company's
filings with the U.S. Securities and Exchange Commission. The
Company undertakes no obligation to update forward-looking
statements to reflect subsequent occurring events or circumstances,
or changes in its expectations, except as may be required by law.
Although the Company believes that the expectations expressed in
these forward-looking statements are reasonable, it cannot assure
you that such expectations will turn out to be correct, and actual
results may differ materially from the anticipated results. You are
urged to consider these factors carefully in evaluating the
forward-looking statements contained herein and are cautioned not
to place undue reliance on such forward-looking statements, which
are qualified in their entirety by these cautionary statements.
CHINA INTERNET
NATIONWIDE FINANCIAL SERVICES INC. AND SUBSIDIARIES
UNAUDITED
CONDENSED CONSOLIDATED BALANCE SHEETS
(In
US$)
|
|
As of
June 30,
|
|
As of
December 31,
|
|
2018
|
|
2017
|
ASSETS
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
16,300,063
|
|
$
|
27,165,262
|
Accounts receivable
(including $0 and $0 of receivable from related parties as of June
30, 2018 and December 31, 2017, respectively)
|
|
10,609,417
|
|
|
6,290,000
|
Receivable under
Factoring
|
|
2,189,946
|
|
|
-
|
Other
receivables
|
|
1,411,615
|
|
|
532,028
|
Loan to third
parties
|
|
43,761,056
|
|
|
41,690,640
|
Prepayments and
advance to suppliers
|
|
1,623,962
|
|
|
306,473
|
Other current
asset
|
|
153,647
|
|
|
-
|
Total Current
Assets
|
|
76,049,706
|
|
|
75,984,403
|
|
|
|
|
|
|
Non-current
assets
|
|
|
|
|
|
Equipment,
net
|
|
439,710
|
|
|
222,142
|
Intangible assets,
net
|
|
1,339,116
|
|
|
1,428,566
|
Long-term office
rental deposit
|
|
1,360,243
|
|
|
678,419
|
Long-term
prepayment
|
|
12,357
|
|
|
3,807
|
Goodwill
|
|
742,976
|
|
|
752,345
|
Deferred Tax
Assets
|
|
383,644
|
|
|
133,729
|
Total
Assets
|
$
|
80,327,752
|
|
$
|
79,203,411
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
Accrued
payroll
|
$
|
1,107,339
|
|
$
|
1,265,308
|
Accounts
payable
|
|
19,441
|
|
|
71,136
|
Advance from
customers
|
|
270,855
|
|
|
22,733
|
Other payables and
accruals
|
|
503,461
|
|
|
671,194
|
Due to
shareholder
|
|
163,614
|
|
|
163,659
|
Taxes
payable
|
|
1,031,707
|
|
|
5,680,094
|
Total Current
Liabilities
|
|
3,096,417
|
|
|
7,874,124
|
|
|
|
|
|
|
Deferred tax
liabilities
|
|
200,221
|
|
|
213,511
|
Total
Liabilities
|
|
3,296,638
|
|
|
8,087,635
|
|
|
|
|
|
|
Shareholders'
equity
|
|
|
|
|
|
Common Stock ($0.001
par value, unlimited authorized shares, and 22,114,188 shares
issued and outstanding)
|
|
22,114
|
|
|
22,114
|
Additional paid in
capital
|
|
28,441,045
|
|
|
28,441,045
|
Statutory
reserve
|
|
1,828,601
|
|
|
1,828,601
|
Retained
earnings
|
|
48,406,265
|
|
|
41,556,125
|
Accumulated other
comprehensive loss
|
|
(1,666,911)
|
|
|
(732,109)
|
Total Shareholders'
Equity
|
|
77,031,114
|
|
|
71,115,776
|
Total Liabilities and
Shareholders' Equity
|
$
|
80,327,752
|
|
$
|
79,203,411
|
CHINA INTERNET
NATIONWIDE FINANCIAL SERVICES INC. AND SUBSIDIARIES
UNAUDITED
CONDENSED CONSOLIDATED INCOME STATEMENT
(In
US$)
|
|
Six Months
Ended
June 30, 2018
|
|
Six Months
Ended
June 30, 2017
|
Revenue
|
|
|
|
|
|
International
corporate financing advisory
|
$
|
1,154,980
|
|
$
|
763,539
|
Intermediary bank
advisory services
|
|
5,430,625
|
|
|
2,068,147
|
Commercial Payment
Advisory Services
|
|
4,717,529
|
|
|
5,141,528
|
Factoring
service
|
|
74,457
|
|
|
-
|
Technical
service
|
|
41,655
|
|
|
-
|
Total
revenue
|
|
11,419,246
|
|
|
7,973,214
|
|
|
|
|
|
|
Cost of
revenues
|
|
378,876
|
|
|
182,514
|
Gross
profit
|
|
11,040,370
|
|
|
7,790,700
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
Selling and marketing
expenses
|
|
694,292
|
|
|
26,295
|
General and
administrative expenses
|
|
5,464,631
|
|
|
611,860
|
Research and
development expenses
|
|
1,573,074
|
|
|
-
|
Total Operating
expenses
|
|
7,731,997
|
|
|
638,155
|
Income from
operations
|
|
3,308,373
|
|
|
7,152,545
|
|
|
|
|
|
|
Other income
(expenses)
|
|
|
|
|
|
Interest income on
bank deposit
|
|
13,533
|
|
|
4,618
|
Other expenses,
net
|
|
(28,827)
|
|
|
(26,399)
|
Interest income from
loans to third parties
|
|
3,284,745
|
|
|
1,455,692
|
Total other
income, net
|
|
3,269,451
|
|
|
1,433,911
|
|
|
|
|
|
|
Income before income
tax expenses
|
|
6,577,824
|
|
|
8,586,456
|
Income tax (benefit)
/ expense
|
|
(272,316)
|
|
|
347,302
|
Net
Income
|
$
|
6,850,140
|
|
$
|
8,239,154
|
Other
comprehensive loss
|
|
|
|
|
|
Foreign currency
translation (loss) / gain
|
|
(934,801)
|
|
|
728,988
|
Comprehensive
Income
|
$
|
5,915,339
|
|
$
|
8,968,142
|
Weighted average
number of shares, basic and diluted
|
|
22,114,188
|
|
|
20,000,000
|
Basic and diluted
earnings per share
|
$
|
0.31
|
|
$
|
0.41
|
View original
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SOURCE China Internet Nationwide Financial Services Inc.