Jerash Holdings Reports Record Revenue and Earnings for Fiscal 2022 Second Quarter; Increases Revenue Guidance for Full Fiscal Year
Jerash Holdings (NASDAQ:JRSH) reported strong financial results for the fiscal 2022 second quarter, ending September 30, 2021. Revenue surged by 68.8% to $45.7 million, driven by increased shipments and demand. Gross profit rose 71.8% to $10.1 million, with a gross margin of 22.1% compared to 21.7% last year. Comprehensive income reached $4.4 million or $0.39 per share, up from $2.6 million or $0.23 per share. The company anticipates fiscal 2022 revenue between $125 million and $130 million, reflecting strong demand and improved capacity.
- Revenue increased 68.8% to $45.7 million.
- Gross profit rose 71.8% to $10.1 million.
- Gross margin improved to 22.1%.
- Comprehensive income reached $4.4 million, or $0.39 per share.
- Company anticipates record fiscal 2022 revenue between $125 million and $130 million.
- Operating expenses increased to $4.5 million, primarily due to higher shipping costs and recruitment expenses.
- Potential risks from supply chain issues could affect shipment timing.
FAIRFIELD, NJ / ACCESSWIRE / November 10, 2021 / Jerash Holdings (US), Inc. ("Jerash") (NASDAQ:JRSH), which manufactures and exports custom, ready-made, sportswear and outerwear for leading global brands, today announced financial results for its fiscal 2022 second quarter, ended September 30, 2021.
Financial Highlights - Fiscal 2022 Second Quarter Versus Fiscal 2021 Second Quarter
- Revenue of
$45.7 million , an increase of 68.8 percent, reflecting higher shipments - Gross profit of
$10.1 million , an increase of 71.8 percent, due to higher revenue and gross margin - Gross margin of 22.1 percent versus 21.7 percent, reflecting improved product mix and higher sales volumes
- Comprehensive income attributable to Jerash's common stockholders of
$4.4 million , or$0.39 per share, vs.$2.6 million , or$0.23 per share
Fiscal 2022 Guidance
- Fiscal 2022 revenue expected to be in the range of
$125 million to$130 million versus$90.2 million in fiscal 2021 - Revenue in fiscal 2022 expected to be at record levels
- Fiscal 2022 third quarter revenue expected to be in the range of
$31 million to$33 million
Sam Choi, chairman and chief executive officer, said, "Our fiscal 2022 second quarter results demonstrated continued strong progress, with robust performance in revenue and margin. Revenue and gross profit were at record levels for the second quarter, reflecting an increase in shipments to our largest customers as a result of strong demand and expanded capacity, as well as an improved mix of products sold.
"We continue to advance our plans to increase capacity and secure additional space to meet our customers' needs," Choi said. "We anticipate the momentum to continue into fiscal 2023. All of our existing factories in Jordan are fully booked through May 2022, with orders from existing top global brand-name customers. As a result, we have increased our fiscal 2022 revenue outlook to reflect the robust momentum and expanded capacity."
Fiscal 2022 Second Quarter Results
Fiscal 2022 second quarter revenue rose 68.8 percent to a record
Gross profit increased to
Operating expenses totaled
Operating income rose to
Gilbert Lee, chief financial officer, said, "Our updated outlook for the remainder of this fiscal year reflects our expectation for continued strong customer demand and increased capacity with orders reflective of typical customer patterns. However, it is important to note that potential risks from supply chain issues that some of our customers are facing could affect the timing of shipments in the near term."
Cash and restricted cash totaled
On November 2, 2021, Jerash approved a regular quarterly dividend of
On October 4, 2021, Jerash completed a public offering of 1.4 million shares of common stock at a price of
On October 11, 2021, Jerash completed the acquisition of Mustafa and Kamal Ashraf Trading Company (Jordan) for Manufacture of Ready-Made Clothes LLC ("MK Garments"), which operates a 71,000 square-foot apparel manufacturing facility. Jerash assumed production at the MK Garments facility and retained its 500 employees in August 2021.
Conference Call
Jerash will host an investor conference call to discuss its fiscal 2022 second quarter results tomorrow, November 11, 2021, at 9:00 a.m. Eastern Time.
Phone: 888-506-0062 (domestic); 973-528-0011 (international)
Conference ID: 470920
A live and archived webcast will be available online in the investor relations section of Jerash's website at www.jerashholdings.com. For those who are not able to listen to the live broadcast, the call will be archived for approximately one year on the website.
About Jerash Holdings (US), Inc.
Jerash Holdings (US), Inc. manufactures and exports custom, ready-made, sportwear and outerwear for leading global brands and retailers, including Walmart, Costco, New Balance, G-III (which owns brands such as Calvin Klein, Tommy Hilfiger, DKNY, and Guess), American Eagle, and VF Corporation (which owns brands such as The North Face, Timberland, and JanSport). Jerash's existing production facilities comprise six factory units and four warehouses. Jerash currently employs approximately 5,100 people, and the total annual capacity at its facilities is approximately 15 million pieces. Additional information is available at www.jerashholdings.com.
Forward-Looking Statements
This news release contains forward-looking statements that involve risks and uncertainties, which may cause actual results to differ materially from the statements made. When used in this document, the words "may", "would", "could", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect", "seek", "potential," "outlook" and similar expressions are intended to identify forward-looking statements. Such statements, including, but not limited to, Jerash's current views with respect to future events and its financial forecasts, are subject to such risks and uncertainties. Many factors could cause actual results to differ materially from the statements made, including those risks described from time to time in filings made by Jerash with the Securities and Exchange Commission. In addition, there is uncertainty about the further spread of the COVID-19 virus or new variants thereof, or the occurrence of another wave of cases and the impact it may have on the company's operations, the demand for the company's products, global supply chains and economic activity in general. These and other risks and uncertainties are detailed in the company's filings with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated or expected. Statements contained in this news release regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Jerash does not intend and does not assume any obligation to update these forward-looking statements, other than as required by law.
Contact:
PondelWilkinson Inc.
Judy Lin Sfetcu or Roger Pondel
310-279-5980; jsfetcu@pondel.com
# # #
(tables below)
JERASH HOLDINGS (US), INC., SUBSIDIARIES AND AFFILIATE
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(UNAUDITED)
| For the Three Months Ended September 30, | For the Six Months Ended September 30, | |||||||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||||||
Revenue, net | $ | 45,711,166 | $ | 27,086,318 | $ | 75,599,858 | $ | 45,793,073 | ||||||||
Cost of goods sold | 35,606,587 | 21,203,568 | 59,864,337 | 36,858,753 | ||||||||||||
Gross Profit | 10,104,579 | 5,882,750 | 15,735,521 | 8,934,320 | ||||||||||||
Selling, general and administrative expenses | 4,223,671 | 2,853,679 | 7,537,902 | 4,704,506 | ||||||||||||
Stock-based compensation expenses | 315,296 | - | 315,813 | 42,151 | ||||||||||||
Total Operating Expenses | 4,538,967 | 2,853,679 | 7,853,715 | 4,746,657 | ||||||||||||
Income from Operations | 5,565,612 | 3,029,071 | 7,881,806 | 4,187,663 | ||||||||||||
Other (Expense) Income: | ||||||||||||||||
Other (expense) income, net | (74,557 | ) | 62,917 | (38,276 | ) | 60,178 | ||||||||||
Total other (expense) income, net | (74,557 | ) | 62,917 | (38,276 | ) | 60,178 | ||||||||||
Net income before provision for income taxes | 5,491,055 | 3,091,988 | 7,843,530 | 4,247,841 | ||||||||||||
Income tax expense | 1,050,330 | 531,896 | 1,468,139 | 873,896 | ||||||||||||
Net Income | 4,440,725 | 2,560,092 | 6,375,391 | 3,373,945 | ||||||||||||
Net loss attributable to noncontrolling interest | 705 | 8 | 722 | 14 | ||||||||||||
Net income attributable to Jerash Holdings (US), Inc.'s Common Stockholders | $ | 4,441,430 | $ | 2,560,100 | $ | 6,376,113 | $ | 3,373,959 | ||||||||
Net Income | $ | 4,440,725 | $ | 2,560,092 | $ | 6,375,391 | $ | 3,373,945 | ||||||||
Other Comprehensive Income: | ||||||||||||||||
Foreign currency translation (loss) gain | (263 | ) | 712 | 79,725 | 159 | |||||||||||
Total Comprehensive Income | 4,440,462 | 2,560,804 | 6,455,116 | 3,374,104 | ||||||||||||
Comprehensive income attributable to noncontrolling interest | - | - | - | - | ||||||||||||
Comprehensive Income Attributable to Jerash Holdings (US), Inc.'s Common Stockholders | $ | 4,440,462 | $ | 2,560,804 | $ | 6,455,116 | $ | 3,374,104 | ||||||||
Earnings Per Share Attributable to Common Stockholders: | ||||||||||||||||
Basic and diluted | $ | 0.39 | $ | 0.23 | $ | 0.56 | $ | 0.30 | ||||||||
Weighted Average Number of Shares | ||||||||||||||||
Basic | 11,334,318 | 11,325,000 | 11,333,907 | 11,325,000 | ||||||||||||
Diluted | 11,512,533 | 11,329,953 | 11,403,931 | 11,330,081 | ||||||||||||
Dividend per share | $ | 0.05 | $ | 0.05 | $ | 0.10 | $ | 0.10 | ||||||||
JERASH HOLDINGS (US), INC., SUBSIDIARIES AND AFFILIATE
CONSOLIDATED BALANCE SHEETS
| September 30, 2021 | March 31, 2021 | |||||||
| (Unaudited) | ||||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash | $ | 25,042,220 | $ | 21,126,090 | ||||
Restricted cash | - | 714,844 | ||||||
Accounts receivable, net | 13,416,125 | 12,033,268 | ||||||
Tax recoverable | 1,079 | 379,719 | ||||||
Inventories | 20,560,272 | 25,035,966 | ||||||
Prepaid expenses and other current assets | 2,833,962 | 2,329,289 | ||||||
Investment deposits | 3,200,000 | - | ||||||
Advance to suppliers, net | 1,886,856 | 3,036,693 | ||||||
Total Current Assets | 66,940,514 | 64,655,869 | ||||||
Restricted cash - non-current | 1,301,588 | 1,020,777 | ||||||
Long-term deposits | 268,255 | 128,690 | ||||||
Deferred tax assets, net | 148,663 | 148,663 | ||||||
Property, plant and equipment, net | 6,554,481 | 5,699,506 | ||||||
Right of use assets | 1,601,671 | 1,596,600 | ||||||
Total Assets | $ | 76,815,172 | $ | 73,250,105 | ||||
LIABILITIES AND EQUITY | ||||||||
Current Liabilities: | ||||||||
Credit facilities | $ | - | $ | 612,703 | ||||
Accounts payable | 4,535,255 | 7,922,839 | ||||||
Accrued expenses | 3,460,886 | 2,332,867 | ||||||
Income tax payable - current | 1,519,978 | 1,803,175 | ||||||
Other payables | 1,076,251 | 1,455,208 | ||||||
Receipt in advance from a customer | 1,474,932 | - | ||||||
Operating lease liabilities - current | 550,099 | 400,043 | ||||||
Total Current Liabilities | 12,617,401 | 14,526,835 | ||||||
Operating lease liabilities - non-current | 905,710 | 935,773 | ||||||
Income tax payable - non-current | 961,048 | 1,094,048 | ||||||
Total Liabilities | 14,484,159 | 16,556,656 | ||||||
Commitments and Contingencies | ||||||||
Equity | ||||||||
Preferred stock, | $ | - | $ | - | ||||
Common stock, | 11,334 | 11,333 | ||||||
Additional paid-in capital | 15,617,080 | 15,301,268 | ||||||
Statutory reserve | 346,315 | 346,315 | ||||||
Retained earnings | 45,991,062 | 40,748,314 | ||||||
Accumulated other comprehensive gain (loss) | 63,824 | (15,901 | ) | |||||
Total Jerash Holdings (US), Inc.'s Stockholder's Equity | 62,029,615 | 56,391,329 | ||||||
Noncontrolling interest | 301,398 | 302,120 | ||||||
Total Equity | 62,331,013 | 56,693,449 | ||||||
Total Liabilities and Equity | $ | 76,815,172 | $ | 73,250,105 | ||||
JERASH HOLDINGS (US), INC., SUBSIDIARIES AND AFFILIATE
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
| For the Six Months Ended September 30, | ||||||||
| 2021 | 2020 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
Net Income | $ | 6,375,391 | $ | 3,373,945 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 880,135 | 829,285 | ||||||
Stock-based compensation expenses | 315,813 | 42,151 | ||||||
Bad debt expense | - | 58,563 | ||||||
Amortization of operating lease right-of-use assets | 356,030 | 365,478 | ||||||
Changes in operating assets: | ||||||||
Accounts receivable | (1,382,857 | ) | (14,588,644 | ) | ||||
Inventories | 4,475,694 | 12,328,893 | ||||||
Prepaid expenses and other current assets | (504,673 | ) | 659,257 | |||||
Advance to suppliers | 1,149,836 | (677,415 | ) | |||||
Changes in operating liabilities: | ||||||||
Accounts payable | (3,387,584 | ) | (1,423,796 | ) | ||||
Accrued expenses | 1,128,019 | 240,129 | ||||||
Other payables | (378,957 | ) | 212,586 | |||||
Receipt in advance from a customer | 1,474,932 | - | ||||||
Operating lease liabilities | (241,107 | ) | (257,577 | ) | ||||
Income tax payable | (37,442 | ) | 550,033 | |||||
Net cash provided by operating activities | 10,223,230 | 1,712,888 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
Purchases of property, plant and equipment | (1,606,419 | ) | (428,280 | ) | ||||
Acquisition deposit | (3,200,000 | ) | - | |||||
Payment for long-term deposits | (268,255 | ) | - | |||||
Receipt of long-term deposits | - | 119,687 | ||||||
Net cash used in investing activities | (5,074,674 | ) | (308,593 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
Dividend payment | (1,133,365 | ) | (1,132,500 | ) | ||||
Repayment from short-term loan | (612,703 | ) | (235 | ) | ||||
Proceeds from short-term loan | - | 932,152 | ||||||
Net cash used in financing activities | (1,746,068 | ) | (200,583 | ) | ||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | 79,609 | (30 | ) | |||||
NET INCREASE IN CASH | 3,482,097 | 1,203,682 | ||||||
CASH, AND RESTRICTED CASH, BEGINNING OF THE PERIOD | 22,861,711 | 26,916,709 | ||||||
CASH, AND RESTRICTED CASH, END OF THE PERIOD | $ | 26,343,808 | $ | 28,120,391 | ||||
CASH AND RESTRICTED CASH, END OF PERIOD | 26,343,808 | 28,120,391 | ||||||
LESS: NON-CURRENT RESTRICTED CASH | 1,301,588 | 786,298 | ||||||
CASH, END OF PERIOD | $ | 25,042,220 | $ | 27,334,093 | ||||
| - | ||||||||
Supplemental disclosure information: | ||||||||
Cash paid for interest | $ | 74,401 | $ | - | ||||
Income tax paid | $ | 1,512,215 | $ | 347,689 | ||||
Non-cash financing activities | ||||||||
Right of use assets obtained in exchange for operating lease obligations | $ | 353,611 | $ | 172,413 | ||||
SOURCE: Jerash Holdings (US), Inc.
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