IT Tech Packaging, Inc. Announces third Quarter 2023 Unaudited Financial Results
- Total revenue for the nine months ended September 30, 2023, decreased by 16.96% compared to the same period in the previous year.
- The third quarter of 2023 saw a significant decrease in revenue, with a 50.26% decline from the same period in the previous year.
- The company experienced a gross loss of $0.15 million and a net loss of $1.98 million for the third quarter of 2023.
- EBITDA for the third quarter of 2023 was approximately $1.69 million, a decrease from $2.43 million for the same period of the previous year.
- The company's net loss increased by 27.85% for the nine months ended September 30, 2023, compared to the same period in the previous year.
- The company's gross profit margin decreased by 3.58 percentage points for the nine months ended September 30, 2023, compared to the same period in the previous year.
BAODING, China, Nov. 10, 2023 /PRNewswire/ -- IT Tech Packaging, Inc. (NYSE American: ITP) ("IT Tech Packaging" or the "Company"), a leading manufacturer and distributor of diversified paper products in
Mr. Zhenyong Liu, Chairman and Chief Executive Officer of the Company, commented, "For the first nine months of 2023, the Company realized a total revenue of
Third Quarter 2023 Unaudited Financial Results
For the Three Months Ended September 30, | |||||
($ millions) | 2023 | 2022 | % Change | ||
Revenues | 15.77 | 31.71 | -50.26 % | ||
Regular Corrugating Medium Paper ("CMP")* | 11.95 | 26.06 | -54.14 % | ||
Light-Weight CMP** | 3.47 | 5.30 | -34.49 % | ||
Offset Printing Paper | 0.07 | - | - | ||
Tissue Paper Products | 0.26 | 0.29 | -9.91 % | ||
Face Masks | 0.02 | 0.06 | -73.28 % | ||
Gross profit (loss) | (0.15) | 2.78 | -105.50 % | ||
Gross profit (loss) margin | -0.97 % | 8.78 % | -9.75pp*** | ||
Regular Corrugating Medium Paper ("CMP")* | 7.01 % | 10.91 % | -3.90pp**** | ||
Light-Weight CMP** | -7.47 % | 12.84 % | -20.31pp**** | ||
Offset Printing Paper | 7.53 % | - | 7.53pp**** | ||
Tissue Paper Products*** | -278.10 % | -258.46 % | -19.64pp****
| ||
Face Masks | -15.75 % | 29.62 % | -45.37pp**** | ||
Operating income（loss） | (2.48) | (0.59) | -323.29 % | ||
Net income (loss) | (1.98) | (1.89) | -4.67 % | ||
EBITDA | 1.69 | 2.43 | -30.45 % | ||
Basic and Diluted earnings (loss) per share | (0.20) | (0.19) | -5.26 % | ||
* Products from PM6 | |||||
** Products from PM1 | |||||
*** Products from PM8 and PM9 | |||||
**** pp represents percentage points | |||||
- Revenue decreased by
50.26% to approximately$15.77 million 105.50% to approximately$0.15 million 0.97% . - Loss from operations was approximately
$2.48 million $0.59 million - Net loss was approximately
$1.98 million $0.20 $1.89 million $0.19 - Earnings before interest, taxes, depreciation and amortization ("EBITDA") was approximately
$1.69million $2.43 million for the same period of last year.
Revenue
For the third quarter of 2023, total revenue decreased by
The following table summarizes revenue, volume and ASP by product for the third quarter of 2023 and 2022, respectively:
For the Three Months Ended September 30, | |||||||||||
2023 | 2022 | ||||||||||
Revenue | Volume | ASP | Revenue | Volume | ASP | ||||||
Regular CMP | 11,954 | 34,186 | 350 | 26,063 | 59,848 | 435 | |||||
Light-Weight CMP | 3,470 | 10,210 | 340 | 5,296 | 12,507 | 423 | |||||
Offset Printing Paper | 69 | 170 | 407 | - | - | - | |||||
Tissue Paper Products | 264 | 241 | 1,096 | 293 | 260 | 1,128 | |||||
Total | 15,757 | 44,807 | 352 | 31,652 | 72,615 | 436 | |||||
Revenue | Volume | ASP | Revenue | Volume | ASP | ||||||
Face Masks | 15 | 507 | 30 | 57 | 1,282 | 44 | |||||
Revenue from CMP, including both regular CMP and light-Weight CMP, decreased by
Of the total CMP sales, revenue from regular CMPdecreased by
The Company sold 170tonnes of offset printing paper at an ASP of
Revenue from tissue paper products decreased by
Revenue from face masks decreased by
Gross Profit and Gross Margin
Total cost of sales decreased by
Total gross loss was approximately
Selling, General and Administrative Expenses
Selling, general and administrative expenses ("SG&A") decreased by
Loss from Operations
Loss from operations was approximately
Net Loss
Net loss was approximately
EBITDA
EBITDA was approximately
Note 1: Non-GAAP Financial Measures
In addition to our
Reconciliation of Net Income to EBITDA
(Amounts expressed in US$)
For the Three Months Ended September 30, | |||||
($ millions) | 2023 | 2022 | |||
Net loss | -1.98 | -1.89 | |||
Add: Income tax | 0.00 | 0.43 | |||
Net interest expense | 0.25 | 0.26 | |||
Depreciation and amortization | 3.42 | 3.63 | |||
EBITDA | 1.69 | 2.43 | |||
Nine Months Ended September 30, 2023 Unaudited Financial Results
For the Nine Months Ended September 30, | ||||||
($ millions) | 2023 | 2022 | % Change | |||
Revenues | 65.58 | 78.98 | -16.96 % | |||
Regular Corrugating Medium Paper ("CMP")* | 50.35 | 65.02 | -22.55 % | |||
Light-Weight CMP** | 11.07 | 12.66 | -12.53 % | |||
Offset Printing Paper | 3.23 | - | - | |||
Tissue Paper Products | 0.83 | 1.10 | -24.62 % | |||
Face Masks | 0.10 | 0.20 | -52.71 % | |||
Gross profit | 0.75 | 3.73 | -79.89 % | |||
Gross profit (loss) margin | 1.14 % | 4.72 % | -3.58 pp**** | |||
Regular Corrugating Medium Paper ("CMP")* | 5.26 % | 7.15 % | -1.89 pp**** | |||
Light-Weight CMP** | 1.68 % | 9.17 % | -7.49 pp**** | |||
Offset Printing Paper | 2.53 % | - | 2.53pp**** | |||
Tissue Paper Products*** | -258.64 % | -193.65 % | -64.99 pp**** | |||
Face Masks | -9.26 % | 25.73 % | -34.99**** | |||
Operating loss | -5.78 | -4.81 | -20.00 % | |||
Net loss | -5.96 | -4.66 | -27.85 % | |||
EBITDA | 5.73 | 7.19 | -20.31 % | |||
Basic and Diluted loss per share | -0.59 | -0.47 | -25.53 % | |||
* Products from PM6 | ||||||
** Products from PM1 | ||||||
*** Products from PM8 and PM9 | ||||||
**** pp represents percentage points | ||||||
Revenue
For the nine months ended September 30, 2023, total revenue decreased by
The following table summarizes revenue, volume and ASP by product for the nine months ended September 30, 2023 and 2022, respectively:
For the Nine Months EndedSeptember30, | ||||||||||||||
2023 | 2022 | |||||||||||||
Revenue | Volume | ASP | Revenue | Volume | ASP | |||||||||
Regular CMP | 50,353 | 135,912 | 370 | 65,015 | 139,036 | 468 | ||||||||
Light-Weight CMP | 11,074 | 31,106 | 356 | 12,660 | 27,990 | 452 | ||||||||
Offset Printing Paper | 3,225 | 5,573 | 579 | - | - | - | ||||||||
Tissue Paper Products | 831 | 726 | 1,145 | 1,103 | 1,040 | 1,061 | ||||||||
Total | 65,483 | 173,317 | 378 | 78,778 | 168,066 | 469 | ||||||||
Revenue | Volume | ASP | Revenue | Volume | ASP | |||||||||
Face Masks | 95 | 3,023 | 31 | 201 | 4,295 | 47 | ||||||||
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 was approximately
Selling, General and Administrative Expenses
Selling, general and administrative expenses ("SG&A") decreased by
Loss from Operations
Loss from operations was approximately
Net 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$)
For the Nine Months Ended September 30, | |||||
($ millions) | 2023 | 2022 | |||
Net loss | -5.96 | -4.66 | |||
Add: Income tax | 0.35 | -0.16 | |||
Net interest expense | 0.77 | 0.79 | |||
Depreciation and amortization | 10.57 | 11.22 | |||
EBITDA | 5.73 | 7.19 | |||
Cash, Liquidity and Financial Position
As of September 30, 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 related party loans) 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: http://www.itpackaging.cn/.
Forward-looking Statement
This release includes "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. Forward-looking statements give our current expectations, opinion, belief or forecasts of future events and performance. A statement identified by the use of forward-looking words including "will,""may,""expects,""projects,""anticipates,""plans,""believes,""estimate,""should," and certain of the other foregoing statements may be deemed forward-looking statements. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including market and other conditions. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company's filings with the SEC. Investors and security holders are urged to read these documents free of charge on the SEC's web site at http://www.sec.gov. The Company undertakes no obligation to update any such forward-looking statements after the date hereof to conform to actual results or changes in expectations, except as required by law.
For more information, please contact:
Email: ir@itpackaging.cn
Tel: +86 312 8698215
IT TECH PACKAGING, INC. | ||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
AS OF SEPTEMBER 30, 2023 AND DECEMBER 31, 2022 | ||||||||
(unaudited) | ||||||||
September 30, | December 31, | |||||||
2023 | 2022 | |||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash and bank balances | $ | 9,437,941 | $ | 9,524,868 | ||||
Restricted cash | - | - | ||||||
Accounts receivable (net of allowance for doubtful accounts of | 2,794,437 | - | ||||||
Inventories | 5,364,777 | 2,872,622 | ||||||
Prepayments and other current assets | 20,049,101 | 27,207,127 | ||||||
Due from related parties | 3,414,815 | 7,561,858 | ||||||
Total current assets | 41,061,071 | 47,166,475 | ||||||
Prepayment on property, plant and equipment | 877,462 | 1,031,502 | ||||||
Operating lease right-of-use assets, net | 562,612 | 672,722 | ||||||
Finance lease right-of-use assets, net | - | 1,939,970 | ||||||
Property, plant, and equipment, net | 144,603,052 | 151,569,898 | ||||||
Value-added tax recoverable | 1,893,510 | 2,066,666 | ||||||
Deferred tax asset non-current | - | - | ||||||
Total Assets | $ | 188,997,707 | $ | 204,447,233 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
Current Liabilities | ||||||||
Short-term bank loans | $ | 835,678 | $ | 5,598,311 | ||||
Current portion of long-term loans | 4,707,652 | 4,835,884 | ||||||
Lease liability | 96,746 | 224,497 | ||||||
Accounts payable | 104,146 | 5,025 | ||||||
Advance from customers | 18,751 | - | ||||||
Due to related parties | 1,103,317 | 727,462 | ||||||
Accrued payroll and employee benefits | 299,908 | 165,986 | ||||||
Other payables and accrued liabilities | 4,858,444 | 5,665,558 | ||||||
Income taxes payable | - | 417,906 | ||||||
Total current liabilities | 12,024,642 | 17,640,629 | ||||||
Long-term loans | 6,562,401 | 4,204,118 | ||||||
Deferred gain on sale-leaseback | - | 52,314 | ||||||
Lease liability - non-current | 465,866 | 579,997 | ||||||
Derivative liability | 263 | 646,283 | ||||||
Total liabilities (including amounts of the consolidated VIE without recourse to the | 19,053,172 | 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 | (12,931,871) | (7,514,540) | ||||||
Retained earnings | 87,612,995 | 93,575,021 | ||||||
Total stockholders' equity | 169,944,535 | 181,323,892 | ||||||
Total Liabilities and Stockholders' Equity | $ | 188,997,707 | $ | 204,447,233 | ||||
See accompanying notes to condensed consolidated financial statements.
1
IT TECH PACKAGING, INC. | ||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) | ||||||||||||||||
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022 | ||||||||||||||||
(Unaudited) | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
Revenues | $ | 15,771,560 | $ | 31,709,214 | $ | 65,582,351 | $ | 78,979,716 | ||||||||
Cost of sales | (15,924,783) | (28,925,626) | (64,832,715) | (75,251,646) | ||||||||||||
Gross (Loss) Profit | (153,223) | 2,783,588 | 749,636 | 3,728,070 | ||||||||||||
Selling, general and administrative expenses | (2,334,746) | (3,370,541) | (6,153,513) | (8,541,224) | ||||||||||||
Loss on impairment of assets | 3,456 | - | (371,680) | - | ||||||||||||
Loss from Operations | (2,484,513) | (586,953) | (5,775,557) | (4,813,154) | ||||||||||||
Other Income (Expense): | ||||||||||||||||
Interest income | 93,298 | 7,729 | 283,203 | 16,108 | ||||||||||||
Interest expense | (247,818) | (256,678) | (767,668) | (786,597) | ||||||||||||
Gain on acquisition | - | (1,759) | - | 30,404 | ||||||||||||
Gain (Loss) on derivative liability | 660,429 | (617,370) | 646,020 | 729,263 | ||||||||||||
Loss before Income Taxes | (1,978,604) | (1,455,031) | (5,614,002) | (4,823,976) | ||||||||||||
Provision for Income Taxes | 3,236 | (432,287) | (348,024) | 160,531 | ||||||||||||
Net Loss | (1,975,368) | (1,887,318) | (5,962,026) | (4,663,445) | ||||||||||||
Other Comprehensive Income (Loss) | ||||||||||||||||
Foreign currency translation adjustment | 1,143,608 | (11,171,156) | (5,417,331) | (21,769,765) | ||||||||||||
Total Comprehensive Loss | $ | (831,760) | $ | (13,058,474) | $ | (11,379,357) | $ | (26,433,210) | ||||||||
Losses Per Share: | ||||||||||||||||
Basic and Diluted Losses per Share | $ | (0.20) | $ | (0.19) | $ | (0.59) | $ | (0.47) | ||||||||
Outstanding – Basic and Diluted | 10,065,920 | 9,991,744 | 10,065,920 | 9,941,288 | ||||||||||||
See accompanying notes to condensed consolidated financial statements.
2
IT TECH PACKAGING, INC. | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022 | ||||||||
(Unaudited) | ||||||||
Nine Months Ended | ||||||||
September 30, | ||||||||
2023 | 2022 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net income | $ | (5,962,026) | $ | (4,663,445) | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 10,573,288 | 11,218,254 | ||||||
(Gain) Loss on derivative liability | (646,020) | (729,263) | ||||||
(Gain) Loss from disposal and impairment of property, plant and equipment | 956,406 | - | ||||||
Allowance for bad debts | (815,317) | (791) | ||||||
Share-based compensation and expenses | - | 1,560,000 | ||||||
Gain on acquisition | - | (30,404) | ||||||
Deferred tax | - | (1,197,630) | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (2,037,003) | 146,250 | ||||||
Prepayments and other current assets | 7,968,553 | (422,092) | ||||||
Inventories | (2,631,661) | 863,170 | ||||||
Accounts payable | 101,328 | 144,331 | ||||||
Advance from customers | 19,140 | - | ||||||
Related parties | 120,298 | (149,827) | ||||||
Accrued payroll and employee benefits | 141,773 | (42,738) | ||||||
Other payables and accrued liabilities | 119,132 | 1,000,945 | ||||||
Income taxes payable | (413,777) | (265,493) | ||||||
Net Cash Provided by Operating Activities | 7,494,114 | 7,431,267 | ||||||
Cash Flows from Investing Activities: | ||||||||
Purchases of property, plant and equipment | (9,211,711) | (1,681,979) | ||||||
Acquisition of land | - | (6,507,431) | ||||||
Net Cash Used in Investing Activities | (9,211,711) | (8,189,410) | ||||||
Cash Flows from Financing Activities: | ||||||||
Proceeds from short term bank loans | 852,988 | 602,319 | ||||||
Proceeds from long term loans | 2,558,963 | 60,232 | ||||||
Repayment of bank loans | (5,549,150) | (307,182) | ||||||
Payment of capital lease obligation | (130,470) | (154,212) | ||||||
Loan to a related party (net) | 4,264,938 | 6,638,923 | ||||||
Net Cash Provided by Financing Activities | 1,997,269 | 6,840,080 | ||||||
Effect of Exchange Rate Changes on Cash and Cash Equivalents | (366,599) | (1,266,146) | ||||||
Net (Decrease) Increase in Cash and Cash Equivalents | (86,927) | 4,815,791 | ||||||
Cash, Cash Equivalents and Restricted Cash - Beginning of Period | 9,524,868 | 11,201,612 | ||||||
Cash, Cash Equivalents and Restricted Cash - End of Period | $ | 9,437,941 | $ | 16,017,403 | ||||
Supplemental Disclosure of Cash Flow Information: | ||||||||
Cash paid for interest, net of capitalized interest cost | $ | 1,118,672 | $ | 248,275 | ||||
Cash paid for income taxes | $ | 761,801 | $ | 1,287,530 | ||||
Cash and bank balances | 9,437,941 | 16,017,403 | ||||||
Restricted cash | - | - | ||||||
Total cash, cash equivalents and restricted cash shown in the statement of cash flows | 9,437,941 | 16,017,403 | ||||||
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SOURCE IT Tech Packaging, Inc.
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