IT Tech Packaging, Inc. Announces Fourth Quarter and Fiscal Year 2023 Financial Results
BAODING,
Mr. Zhenyong Liu, Chairman and Chief Executive Officer of the Company, commented, " In 2023, the company achieved a revenue of
Fourth Quarter 2023 Financial Results
For the Three Months Ended December 31, | ||||||
($ millions) | 2023 | 2022 | % Change | |||
Revenues | 20.96 | 21.37 | -1.91 % | |||
Regular Corrugating Medium Paper ("CMP")* | 17.02 | 17.28 | -1.52 % | |||
Light-Weight CMP** | 3.45 | 3.77 | -8.54 % | |||
Offset Printing Paper | -0.01 | - | n/a | |||
Tissue Paper Products | 0.47 | 0.25 | 87.04 % | |||
Face Masks | 0.01 | 0.06 | -80.65 % | |||
Gross profit | 0.25 | 1.03 | -75.61 % | |||
Gross profit (loss) margin | 1.19 % | 4.80 % | -3.61pp**** | |||
Regular Corrugating Medium Paper ("CMP")* | 5.32 % | 8.28 % | -2.96 pp**** | |||
Light-Weight CMP** | 5.50 % | 10.28 % | -4.78 pp**** | |||
Offset Printing Paper | 41.02 % | - | n/a | |||
Tissue Paper Products*** | -182.10 % | -315.16 % | 133.06 pp**** | |||
Face Masks | -21.19 % | 27.47 % | -48.66 pp**** | |||
Operating income (loss) | -3.80 | -0.49 | -673.41 % | |||
Net income (loss) | -3.98 | -11.91 | -66.54 % | |||
EBITDA | 0.11 | 3.77 | -97.08 % | |||
Basic and Diluted earnings (loss) per share | -0.40 | -1.19 | 66.39 % | |||
* Products from PM6 | ||||||
** Products from PM1 | ||||||
*** Products from PM8 and PM9 | ||||||
**** pp represents percentage points |
- Revenue decreased by
1.91% to approximately .96 million, primarily attributable to a decrease in the average selling price("ASP") of CMP, partially offset by an increase in sales volume of regular CMP, light-weight CMP and offset printing paper.$20 - Gross profit decreased by
75.61% to approximately .25 million. Total gross margin decreased by 3.61 percentage point to$0 1.19% . - Loss from operations was approximately
.80 million, compared to$3 .49 million for the same period of previous year.$0 - Net loss was approximately
.98 million, or loss of$3 .40 per basic and diluted share, compared to$0 , or loss of$11.91 million $1.19 per basic and diluted share, for the same period of previous year. - Earnings before interest, taxes, depreciation and amortization ("EBITDA") decreased by
97.08% to approximately .$0.11 million
Revenue
For the fourth quarter of 2023, total revenue decreased by approximately
The following table summarizes revenue, volume and ASP by product for the fourth quarter of 2023 and 2022, respectively:
For the Quarter Ended December 31, | |||||||||||
2022 | 2023 | ||||||||||
Revenue | Volume | ASP ($/tonne) | Revenue | Volume | ASP | ||||||
Regular CMP | 17,281 | 41,941 | 412 | 17,019 | 46,958 | 362 | |||||
Light-Weight CMP | 3,768 | 9,365 | 402 | 3,446 | 9,847 | 350 | |||||
Offset Printing Paper | - | - | - | -9 | - | - | |||||
Tissue Paper Products | 253 | 234 | 1,083 | 474 | 480 | 987 | |||||
Total | 21,302 | 51,540 | 413 | 20,929 | 57,285 | 365 | |||||
Revenue | Volume | ASP | Revenue | Volume | ASP | ||||||
Face Masks | 57 | 1,330 | 43 | 10 | 360 | 31 |
Revenue from CMP, including both regular CMP and light-Weight CMP, decreased by
Of the total CMP sales, revenue from regular CMP decreased by approximately
Revenue from offset printing paper was $nil for the three months ended December 31, 2023 and 2022, respectively.
Revenue from tissue paper products increased by
Revenue from face masks decreased by
Gross Profit and Gross Margin
Total cost of sales increased by
Total gross profit was approximately
Selling, General and Administrative Expenses
Selling, general and administrative expenses ("SG&A") increased by
Income (Loss) from Operations
Loss from operations was approximately
Net Income (Loss)
Net loss was approximately
EBITDA
EBITDA was approximately
Note 1: Non-GAAP Financial Measures
In addition to our
Reconciliation of Net Income to EBITDA
(Amounts expressed in US$)
For the Three Months Ended December 31, | |||||
($ millions) | 2023 | 2022 | |||
Net income (loss) | -3.98 | -11.91 | |||
Add: Income tax | -0.00 | 11.87 | |||
Net interest expense | 0.22 | 0.24 | |||
Depreciation and amortization | 3.65 | 3.57 | |||
EBITDA | 0.11 | 3.77 |
Full Year Ended December 31, 2023 Financial Results
For the Year Ended December 31, | ||||||
($ millions) | 2023 | 2022 | % Change | |||
Revenues | 86.55 | 100.35 | -13.76 % | |||
Regular Corrugating Medium Paper ("CMP")* | 67.37 | 82.30 | -18.14 % | |||
Light-Weight CMP** | 14.52 | 16.43 | -11.61 % | |||
Offset Printing Paper | 3.22 | 0 | n/a | |||
Tissue Paper Products | 1.31 | 1.36 | -3.76 % | |||
Face Masks | 0.11 | 0.26 | -58.86 % | |||
Gross profit | 1.00 | 4.75 | -78.97 % | |||
Gross profit (loss) margin | 1.16 % | 4.74 % | -3.58 pp**** | |||
Regular Corrugating Medium Paper ("CMP")* | 5.27 % | 7.39 % | -2.12 pp**** | |||
Light-Weight CMP** | 2.59 % | 9.42 % | -6.83 pp**** | |||
Offset Printing Paper | 2.41 % | - | n/a | |||
Tissue Paper Products*** | -230.86 % | -216.34 % | -14.52 pp**** | |||
Face Masks | -10.49 % | 26.11 % | -36.60 pp**** | |||
Operating income (loss) | -9.58 | -5.30 | -80.52 % | |||
Net income(loss) | -9.95 | -16.57 | -39.98 % | |||
EBITDA | 5.61 | 10.96 | -48.81 % | |||
Basic and Diluted earnings (loss) per share | -0.99 | -1.66 | 40.36 % | |||
* Products from PM6 | ||||||
** Products from PM1 | ||||||
*** Products from PM8 and PM9 | ||||||
**** pp represents percentage points |
Revenue
For the year ended December 31, 2023, total revenue decreased by
The following table summarizes revenue, volume and ASP by product for the years ended December 31, 2023 and 2022, respectively:
For the Year Ended December 31, | |||||||||||
2022 | 2023 | ||||||||||
Revenue | Volume | ASP ($/tonne) | Revenue | Volume | ASP ($/tonne) | ||||||
Regular CMP | 82,297 | 180,977 | 455 | 67,371 | 182,870 | 368 | |||||
Light-Weight CMP | 16,428 | 37,354 | 440 | 14,520 | 40,953 | 355 | |||||
Offset Printing Paper | - | - | - | 3,215 | 5,573 | 577 | |||||
Tissue Paper Products | 1,356 | 1,273 | 1,065 | 1,305 | 1,205 | 1,083 | |||||
Total | 100,082 | 219,604 | 456 | 86,412 | 230,601 | 375 | |||||
Revenue | Volume | ASP | Revenue | Volume | ASP | ||||||
Face Masks | 258 | 5,625 | 46 | 106 | 3,383 | 31 |
Revenue from CMP, including both regular CMP and light-Weight CMP decreased by
Of the total CMP sales, revenue from regular CMP decreased by
Revenue from offset printing paper was
Revenue from tissue paper products decreased by
Revenue from face masks decreased by
Gross Profit and Gross Margin
Total cost of sales decreased by
Total gross profit decreased by
Selling, General and Administrative Expenses
SG&A expenses decreased by
Income (Loss) from Operations
Loss from operations decreased by
Net Income (Loss)
Net loss increased by
EBITDA
EBITDA decreased by
Note 1: Non-GAAP Financial Measures
In addition to our
Reconciliation of Net Income to EBITDA
(Amounts expressed in US$)
For the Year Ended December 31, | |||||
($ millions) | 2023 | 2022 | |||
Net income (loss) | -9.95 | -16.57 | |||
Add: Income tax | 0.35 | 11.71 | |||
Net interest expense | 0.98 | 1.03 | |||
Depreciation and amortization | 14.23 | 14.79 | |||
EBITDA | 5.61 | 10.96 |
Cash, Liquidity and Financial Position
As of December 31, 2023, the Company had cash and bank balances, short-term debt (including bank loans, current portion of long-term loans from credit union and related party loans), and long-term debt (including loan from credit union) of approximately
Net accounts receivable was approximately
Net Cash provided by operating activities was approximately
About IT Tech Packaging, Inc.
Founded in 1996, IT Tech Packaging, Inc. is a leading manufacturer and distributor of diversified paper products and single-use face masks in North China. Using recycled paper as its primary raw material (with the exception of its tissue paper products), ITP produces and distributes three categories of paper products: corrugating medium paper, offset printing paper and tissue paper products. With production based in Baoding and Xingtai in North China's Hebei Province, ITP is located strategically close to the Beijing and Tianjin region, home to a growing base of industrial and manufacturing activities and one of the largest markets for paper products consumption in the country. ITP has been listed on the NYSE American since December 2009. For more information, please visit: https://www.itpackaging.cn/.
Safe Harbor Statements
This press release may contain forward-looking statements. These forward-looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from those projected or anticipated, including risks outlined in the Company's public filings with the Securities and Exchange Commission, including the Company's latest annual report on Form 10-K. All information provided in this press release speaks as of the date hereof. Except as otherwise required by law, the Company undertakes no obligation to update or revise its forward-looking statements.
For more information, please contact:
At the Company
Email: ir@itpackaging.cn
Tel: +86 0312 8698215
IT TECH PACKAGING, INC. CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2023 AND 2022 | |||||||
December 31, | December 31, | ||||||
2023 | 2022 | ||||||
ASSETS | |||||||
Current Assets | |||||||
Cash and bank balances | $ | 3,918,938 | $ | 9,524,868 | |||
Restricted cash | 472,983 | - | |||||
Accounts receivable (net of allowance for doubtful accounts of | 575,526 | - | |||||
Inventories | 3,555,235 | 2,872,622 | |||||
Prepayments and other current assets | 18,981,290 | 27,207,127 | |||||
Due from related parties | 853,929 | 7,561,858 | |||||
Total current assets | 28,357,901 | 47,166,475 | |||||
Prepayment on property, plant and equipment | - | 1,031,502 | |||||
Operating lease right-of-use assets, net | 528,648 | 672,722 | |||||
Finance lease right-of-use assets, net | - | 1,939,970 | |||||
Property, plant, and equipment, net | 163,974,022 | 151,569,898 | |||||
Value-added tax recoverable | 1,883,078 | 2,066,666 | |||||
Deferred tax asset non-current | - | - | |||||
Total Assets | $ | 194,743,649 | $ | 204,447,233 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current Liabilities | |||||||
Short-term bank loans | $ | 423,567 | $ | 5,598,311 | |||
Current portion of long-term loans | 6,874,497 | 4,835,884 | |||||
Lease liability | 100,484 | 224,497 | |||||
Accounts payable | 4,991 | 5,025 | |||||
Advance from customers | 136,167 | - | |||||
Due to related parties | 728,869 | 727,462 | |||||
Accrued payroll and employee benefits | 237,842 | 165,986 | |||||
Other payables and accrued liabilities | 12,912,517 | 5,665,558 | |||||
Income taxes payable | - | 417,906 | |||||
Total current liabilities | 21,418,934 | 17,640,629 | |||||
Long-term loans | 4,503,932 | 4,204,118 | |||||
Deferred gain on sale-leaseback | - | 52,314 | |||||
Lease liability - non-current | 483,866 | 579,997 | |||||
Derivative liability | 54 | 646,283 | |||||
Total liabilities (including amounts of the consolidated VIE without recourse | 26,406,786 | 23,123,341 | |||||
Commitments and Contingencies | |||||||
Stockholders' Equity | |||||||
Common stock, 50,000,000 shares authorized, | 10,066 | 10,066 | |||||
Additional paid-in capital | 89,172,771 | 89,172,771 | |||||
Statutory earnings reserve | 6,080,574 | 6,080,574 | |||||
Accumulated other comprehensive loss | (10,555,534) | (7,514,540) | |||||
Retained earnings | 83,628,986 | 93,575,021 | |||||
Total stockholders' equity | 168,336,863 | 181,323,892 | |||||
Total Liabilities and Stockholders' Equity | $ | 194,743,649 | $ | 204,447,233 |
IT TECH PACKAGING, INC. CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS) FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 | |||||||
Year Ended | |||||||
December 31, | |||||||
2023 | 2022 | ||||||
Revenues | $ | 86,546,950 | $ | 100,352,434 | |||
Cost of sales | (85,547,065) | (95,598,238) | |||||
Gross Profit | 999,885 | 4,754,196 | |||||
Selling, general and administrative expenses | (9,075,475) | (10,058,723) | |||||
(Gain) Loss from disposal and impairment of property, plant | (1,500,298) | - | |||||
Loss from Operations | (9,575,888) | (5,304,527) | |||||
Other Income (Expense): | |||||||
Interest income | 315,096 | 24,264 | |||||
Interest expense | (984,518) | (1,027,951) | |||||
Gain on acquisition | - | 30,994 | |||||
Gain (Loss) on derivative liability | 646,229 | 1,417,251 | |||||
Loss before Income Taxes | (9,599,081) | (4,859,969) | |||||
Provision for Income Taxes | (346,954) | (11,711,339) | |||||
Net Loss | (9,946,035) | (16,571,308) | |||||
Other Comprehensive Loss | |||||||
Foreign currency translation adjustment | (3,040,994) | (18,010,708) | |||||
Total Comprehensive Loss | $ | (12,987,029) | $ | (34,582,016) | |||
Losses Per Share: | |||||||
Basic and Diluted Losses per Share | $ | (0.99) | $ | (1.66) | |||
Outstanding – Basic and Diluted | 10,065,920 | 9,972,788 |
IT TECH PACKAGING, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 | ||||||
Year Ended | ||||||
December 31, | ||||||
2023 | 2022 | |||||
Cash Flows from Operating Activities: | ||||||
Net income | $ | (9,946,035) | $ | (16,571,308) | ||
Adjustments to reconcile net income to net cash provided by operating | ||||||
Depreciation and amortization | 14,225,990 | 14,788,036 | ||||
(Gain) Loss on derivative liability | (646,229) | (1,417,251) | ||||
(Gain) Loss from disposal and impairment of property, plant and equipment | 1,608,542 | - | ||||
(Recovery from) Allowance for bad debts | 34,193 | 843,779 | ||||
Allowances for inventories, net | 2,970 | - | ||||
Share-based compensation and expenses | - | 156,000 | ||||
Gain on acquisition | - | (30,992) | ||||
Deferred tax | - | 10,261,104 | ||||
Changes in operating assets and liabilities: | ||||||
Accounts receivable | 280,970 | 3,750,196 | ||||
Prepayments and other current assets | 9,322,532 | (3,976,010) | ||||
Inventories | (736,267) | 2,554,072 | ||||
Accounts payable | 50 | (4,496) | ||||
Advance from customers | 136,686 | (37,452) | ||||
Related parties | (478,025) | 444,291 | ||||
Accrued payroll and employee benefits | 74,908 | (103,683) | ||||
Other payables and accrued liabilities | (596,695) | 677,840 | ||||
Income taxes payable | (412,504) | (614,738) | ||||
Net Cash Provided by Operating Activities | 12,871,086 | 10,719,388 | ||||
Cash Flows from Investing Activities: | ||||||
Purchases of property, plant and equipment | (22,292,870) | (4,534,092) | ||||
Proceeds from sale of property, plant and equipment | 53,573 | - | ||||
Acquisition of land | - | (6,364,439) | ||||
Net Cash Used in Investing Activities | (22,239,297) | (10,898,531) | ||||
Cash Flows from Financing Activities: | ||||||
Proceeds from issuance of shares and warrants, net | - | - | ||||
Proceeds from short term bank loans | 1,275,546 | 6,214,020 | ||||
Proceeds from long term loans | 3,769,948 | 59,195 | ||||
Repayment of bank loans | (7,647,610) | (6,071,952) | ||||
Payment of capital lease obligation | (74,154) | (206,114) | ||||
Loan to a related party (net) | 7,086,369 | (874,745) | ||||
Net Cash Provided by (Used in) Financing Activities | 4,410,099 | (879,596) | ||||
Effect of Exchange Rate Changes on Cash and Cash Equivalents | (174,835) | (618,005) | ||||
Net Decrease in Cash and Cash Equivalents | (5,132,947) | (1,676,744) | ||||
Cash, Cash Equivalents and Restricted Cash - Beginning of Year | 9,524,868 | 11,201,612 | ||||
Cash, Cash Equivalents and Restricted Cash - End of Year | $ | 4,391,921 | $ | 9,524,868 | ||
Supplemental Disclosure of Cash Flow Information: | ||||||
Cash paid for interest, net of capitalized interest cost | $ | 1,484,461 | $ | 320,568 | ||
Cash paid for income taxes | $ | 759,458 | $ | 2,049,911 | ||
Cash and bank balances | 3,918,938 | 9,524,868 | ||||
Restricted cash | 472,983 | - | ||||
Total cash, cash equivalents and restricted cash shown in the statement of | 4,391,921 | 9,524,868 |
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SOURCE IT Tech Packaging, Inc.