NEW YORK, Aug. 13, 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 second quarter ended June 30, 2021.

Mr. Yihua Kang, Chairman, President and Chief Executive Officer of Ever-Glory, said, "During the second 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 second 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 66 stores during 2021, we operated a nationwide network of 931 stores as of June 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 second 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."

Second Quarter 2021 Financial Results 

Total sales for the second quarter of 2021 were $60.6 million, an increase of 20.9% from $50.1 million in the second quarter of 2020. This increase was primarily driven by a 19.9% increase in our wholesale business and a 21.7% increase in retail business.

Sales for the Company's branded fashion apparel retail division increased by 21.7% to $34.1 million for the second quarter of 2021, compared with $28.0 million for the second quarter of 2020. This increase was primarily due to the increase in same-store sales. The Company operated 931 retail stores as of June 30, 2021, compared with 935 retail stores as of June 30, 2020.

Sales for the Company's wholesale division increased by 19.9% to $26.4 million for the second quarter of 2021, compared with $22.0 million for the second quarter of 2020. This increase was primarily attributable to increased sales in Mainland China, Hong Kong, the United Kingdom, and other European markets partially offset for decreased sales in Japan and the United States.

Total gross profit for the second quarter of 2021 increased by 27.3% to $18.4 million, compared with $14.4 million for the second quarter of 2020. Total gross margin for the second quarter of 2021 increased to 30.4% from 28.8% for the second quarter of 2020.

Gross profit for the retail business increased by 46.7% to $14.8 million for the second quarter of 2021, compared with $10.1 million for the second quarter of 2020. Gross margin for the second quarter of 2021 was 43.4% compared to 36.2% for the second quarter of 2020.

Gross profit for the wholesale business decreased by 17.5% to $3.6 million for the second quarter of 2021, compared with $4.4 million for the second quarter of 2020. Gross margin for the second quarter of 2021 decreased to 13.6% from 19.7% for the second quarter of 2020.

Selling expenses for the second quarter of 2021 increased by 14.9% to $14.5 million, or 24.0% of total sales, compared with $12.6 million, or 25.2% of total sales for the second quarter of 2020. The increase was attributable to the increased marketing expenses associated with the promotion of the retail brand.

General and administrative expenses for the second quarter of 2021 increased by 28.3% to $7.7 million, or 12.7% of total sales, compared with $6.0 million, or 11.9% of total sales for the second quarter of 2020. The increase was attributable to the decreased business trip and the exemption of social benefits by the PRC government during the COVID-19 outbreak in China 2020.

Loss from operations was $3.7 million for the second quarter of 2021, compared to $4.2 million for the second quarter of 2020.

Net loss attributable to the Company for the second quarter of 2021 was $1.8 million compared with $3.8 million for the second quarter of 2020. Basic and diluted loss per share were $0.12 for the second quarter of 2021 compared with $0.26 for the second quarter of 2020.

Balance Sheet 

As of June 30, 2021, Ever-Glory had approximately $64.0 million of cash and cash equivalents, compared with approximately $81.9 million as of December 31, 2020. Ever-Glory had working capital of approximately $48.9 million as of June 30, 2021, and outstanding bank loans of approximately $65.5 million as of June 30, 2021.

Conference Call

The Company will hold a conference call at 8:00 a.m. Eastern Time on August 13, 2021(8:00 p.m. Beijing Time on August 13, 2021). Listeners can access the conference call by dialing +1-800-263-0877 or + 1-646-828-8143 and using the access code 2633372. 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 11:00 a.m. Eastern Time on August 13 through 11:59 p.m. Eastern Time on August 20 by calling +1-844-512-2921 or +1-412-317-6671 with pin number 2633372.

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)





June 30,
2021

December 31,
2020

ASSETS












CURRENT ASSETS





Cash and cash equivalents

$

63,963

$

81,865

Restricted cash

42,725


39,858

Trading securities

3,581


1,792

Accounts receivable, net

39,643


53,285

Inventories

60,190


53,893

Advances on inventory purchases

7,556


10,261

Value added tax receivable

2,114


1,244

Other receivables and prepaid expenses

6,255


5,479

Amounts due from related parties

186


567

Total Current Assets

226,213


248,244









NON-CURRENT ASSETS







Equity security investment

5,929


3,932

Intangible assets, net

4,750


4,794

Property and equipment, net

33,414


32,164

Operating lease right-of-use assets

49,725


41,690

Deferred tax assets

306


902

Total Non-Current Assets

94,124


83,482

TOTAL ASSETS

$

320,337

$

331,726









LIABILITIES AND STOCKHOLDERS' EQUITY
















CURRENT LIABILITIES







Bank loans

$

65,498

$

65,919

Accounts payable

52,595


67,762

Accounts payable and other payables – related parties

2,131


3,764

Other payables and accrued liabilities

15,410


16,073

Value added and other taxes payable

-


909

Income tax payable

493


1,062

Current operating lease liabilities

41,174


33,481

Total Current Liabilities

177,301


188,970









NON-CURRENT LIABILITIES







Non-current operating lease liabilities

8,676


8,307

TOTAL LIABILITIES

185,977


197,277









COMMITMENTS AND CONTINGENCIES (Note 9)
















STOCKHOLDERS' EQUITY







Common stock ($0.001 par value, authorized 50,000,000 shares, 14,810,660 and
14,809,160 shares issued and outstanding as of June 30, 2021 and December 31,
2020, respectively)

15


15

Additional paid-in capital

3,655


3,650

Retained earnings

106,230


109,171

Statutory reserve

20,376


20,376

Accumulated other comprehensive income

6,672


4,590

Amounts due from related party

(2,588)


(3,353)

Total equity

134,360


134,449

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

320,337

$

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

Six months ended


June 30,

June 30,


2021

2020

2021

2020

NET SALES

$

60,555

$

50,086

$

131,369

$

108,441

COST OF SALES

42,163


35,641


90,541


77,958
















GROSS PROFIT

18,392


14,445


40,828


30,483
















OPERATING EXPENSES














Selling expenses

14,503


12,626


30,052


26,105

General and administrative expenses

7,662


5,971


15,513


11,755

Total Operating Expenses

22,165


18,597


45,565


37,860
















LOSS FROM OPERATIONS

(3,773)


(4,152)


(4,737)


(7,377)
















OTHER INCOME (EXPENSES)














Interest income

527


339


752


616

Interest expense

(200)


(566)


(692)


(907)

Government subsidy

243


231


502


691

Gain from changes in fair values of investments

2,041


4


2,275


4

Other income

477


610


774


968

Total Other Income, Net

3,088


618


3,611


1,372
















LOSS BEFORE INCOME TAX EXPENSE

(685)


(3,534)


(1,126)


(6,005)
















Income tax expense

(1,086)


(266)


(1,815)


(493)
















NET LOSS

(1,771)


(3,800)


(2,941)


(6,498)
















Net loss attributable to the non-controlling interest

-


6


-


3

NET LOSS ATTRIBUTABLE TO THE COMPANY

(1,771)


(3,794)


(2,941)


(6,495)
















NET LOSS

$

(1,771)

$

(3,800)

$

(2,941)

$

(6,498)
















Foreign currency translation gain (loss)

3,434


(263)


2,083


(1,700)

COMPREHENSIVE INCOME (LOSS)

1,663


(4,063)


(858)


(8,198)
















Comprehensive loss attributable to the non-controlling
   interest

-


8


-


2

COMPREHENSIVE
   INCOME  (LOSS) ATTRIBUTABLE TO THE
   COMPANY

$

1,663

$

(4,055)

$

(858)

$

(8,196)
















LOSS PER SHARE ATTRIBUTABLE TO THE
   COMPANY'S STOCKHOLDERS














Basic and diluted

$

(0.12)

$

(0.26)

$

(0.20)

$

(0.44)

Weighted average number of shares outstanding Basic
   and diluted

14,810,660


14,804,832


14,810,330


14,804,595

 

 

 

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

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, 
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
   adjustment





















(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 income

-


-


-


(1,771)


-


-


-


(1,771)


-


(1,771)

Net cash received
   from related party
   under counter
   guarantee
   agreement

-


-


-


-


-


-


386


386


-


386

Foreign currency
   translation
   adjustment

-


-


-


-


-


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














































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


0.003


5


-


-


-


-


5






5

Net income (loss)

-


-


-


(2,701)


-


-


-


(2,701)


3


(2,698)

Net cash received
   from related party
   under counter
   guarantee
   agreement

-


-


-


-


-


-


785


785


-


785

Foreign currency
   translation
   adjustment





















(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
   adjustment





















(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

 

 

 

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)




Six Months Ended


June 30,
2021

June 30,
2020

CASH FLOWS FROM OPERATING ACTIVITIES





Net loss

$

(2,941)

$

(6,498)

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







Depreciation and amortization

3,212


3,597

Loss from sale of property and equipment

463


189

Provision of bad debt allowance

652


969

Write off obsolete inventories

5,530


3,681

Changes in fair value of investment

(2,275)


-

Deferred income tax

604


71

Stock-based compensation

5


5

Changes in operating assets and liabilities







Accounts receivable

13,433


30,444

Inventories

(11,346)


11,659

Value added tax receivable

(562)


1,076

Other receivables and prepaid expenses

(632)


737

Advances on inventory purchases

2,928


3,845

Amounts due from related parties

546


(214)

Accounts payable

(17,753)


(22,522)

Accounts payable and other payables- related parties

(1,763)


(466)

Other payables and accrued liabilities

1,201


(7,027)

Value added and other taxes payable

(1,209)


(1,593)

Income tax payable

(581)


(910)

Net cash (used in) provided by operating activities

(10,488)


17,043









CASH FLOWS FROM INVESTING ACTIVITIES







Purchases of property and equipment

(4,452)


(1,018)

Net (purchase) sale of trading securities

(1,468)


(825)

Net cash (used in) investing activities

(5,920)


(1,843)









CASH FLOWS FROM FINANCING ACTIVITIES







Proceeds from bank loans

12,841


31,995

Repayment of bank loans

(13,905)


(21,173)

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

798


898

Net cash  (used in) provided by financing activities

(266)


11,720









EFFECT OF EXCHANGE RATE CHANGES ON CASH

1,639


(723)









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

(15,035)


26,197









CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF
   PERIOD

121,723


50,755









CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF
   PERIOD

$

106,688

$

76,952









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
















Cash and Cash Equivalents

63,963


59,236

Restricted cash

42,725


17,716


$

106,688

$

76,952









SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:







Cash paid during the period for:







Interest

$

692

$

907

Income taxes

$

1,781

$

493

 

Cision View original content:https://www.prnewswire.com/news-releases/ever-glory-reports-second-quarter-2021-financial-results-301354920.html

SOURCE Ever-Glory International Group, Inc.

Copyright 2021 PR Newswire

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