NAM TAI PROPERTY INC. Announces Q3 2021 Results
Nam Tai Property Inc. (NTP) reported unaudited financial results for Q3 2021, highlighting a revenue increase to $5.8 million, up from $1.1 million in Q3 2020. The company secured a loan facility of $164 million from Bank of Guangzhou. Despite a net loss of $4.3 million, a decrease from $4.9 million in the previous year, operational challenges persist due to restrictive government measures affecting the property market causing decreased demand.
Key highlights include a 10% increase in occupancy at Nam Tai Inno Park and progress in construction projects.
- Revenue increased to $5.8 million, up 442.7% year-on-year.
- Secured a loan facility of approximately $164 million from Bank of Guangzhou.
- Reduced net loss from operations to $3.3 million, down from $5.8 million in Q3 2020.
- Occupancy rate for Nam Tai Inno Park improved by 10 percentage points, reaching 69%.
- Attracted customers for 78 units at Nam Tai Longxi.
- Net loss of $4.3 million indicates ongoing profitability challenges.
- Real estate properties under development decreased by $67.3 million year-on-year.
- Liquidity issues remain, with restrictions on bank account remittance due to lawsuits.
- Demand slowdown and price decreases in the housing sector affecting overall operations.
SHENZHEN, China, Nov. 4, 2021 /PRNewswire/ -- Nam Tai Property Inc. ("Nam Tai" or the "Company") (NYSE Symbol: NTP) today announced its unaudited financial results for the quarter ended September 30, 2021.
SUMMARY
PRC government continued to roll out restrictive measures to curb speculation in the domestic property market in the reporting period. The real estate sector is experiencing an extremely challenging financing and operating environment, and there have been a number of high profile defaults reported in the media. Loans to the real estate sector decreased
Amid the challenging operating environment, in the third quarter of 2021, the Company recorded progress both financially and operationally, including the following: (i) the revenue increased by
With the success in securing new financing from Bank of Guangzhou Co., Ltd., the Company is confident it will restore the normal operations of the Company and its subsidiaries gradually. The board of directors and management will make every endeavor to act for the best interest of the Company and all shareholders.
Highlights:
- Revenue was
$5.8 million in the third quarter of 2021, an increase of$4.7 million year-on-year. - Net loss from operations was
$3.3 million in the third quarter of 2021, reduced from net loss from operations of$5.8 million in the third quarter of 2020. - Consolidated net loss was
$4.3 million in the third quarter of 2021, reduced from consolidated net loss from operations of$4.9 million in the third quarter of 2020. - Real estate properties under development, net was
$317.9 million as of September 30, 2021, an increase of$5.7 million from the end of 2020. - Real estate properties held for lease, net was
$151.7 million as of September 30, 2021, an increase of$59.5 million from the end of 2020.
In addition:
- The Company (through its wholly owned indirect subsidiary, Nam Tai Investment (Shenzhen) Co., Ltd. ("Nam Tai Investment")) secured a loan facility of up to RMB1.06 billion (approximately
$164 million ) from Shenzhen Branch of Bank of Guangzhou Co., Ltd. ("Bank of Guangzhou") for a term of five years. As of September 30, 2021, Nam Tai Investment drew down approximately RMB575 million (approximately$88.6 million ) under such loan facility. - The Company repaid the amount due to the Shenzhen Branch of Bank of Beijing Co., Ltd ("Bank of Beijing") and Shenzhen Branch of Industrial Bank Co., Ltd. ("Industrial Bank") in full in September 2021.
- The occupancy rate of Nam Tai Inno Park reached
69% by the end of the third quarter of 2021, an increase of 10 percentage points quarter-on-quarter. - The Company commenced the pre-sale of units of Nam Tai • Longxi in August 2021 and received earnest money from purchasers for a total of 78 units, or 9,144 square meters in gross floor area as of September 30, 2021.
- The Company has completed the masonry work for Towers A, B, C and D of Nam Tai Technology Center. The Company is conducting interior decoration for Towers A, B, C and working on plastering for Tower D.
- In October 2021, Nam Tai Inno Park was awarded the Gold Winner for lighting design of MUSE Design Awards, which represents a strong endorsement of the Company's commitment to high-quality technology park.
The following tables set forth key highlights of the financial information for the periods indicated:
(In thousands of US dollars, except per share data, percentages and as otherwise stated)
Quarterly Results | Nine Months Results | |||||||||||||||||||||||
Q3 2021 | Q3 2020 | YoY(%)(a) | 9M 2021 | 9M 2020 | YoY(%)(a) | |||||||||||||||||||
Revenue | $ | 5,791 | $ | 1,067 | $ | 84,385 | $ | 2,609 | ||||||||||||||||
Gross profit | $ | 2,141 | $ | 241 | $ | 52,580 | $ | 483 | ||||||||||||||||
Net (loss) income from operations | $ | (3,274) | $ | (5,775) | $ | 32,660 | $ | (13,986) | ||||||||||||||||
% of revenue | (56.5)) | % | (541.2) | % | 38.7 | % | (536.1) | % | ||||||||||||||||
per share (diluted) | $ | (0.08) | $ | (0.15) | $ | 0.83 | $ | (0.36) | ||||||||||||||||
Consolidated net (loss) income | $ | (4,311) | $ | (4,850) | $ | 21,028 | $ | (11,810) | ||||||||||||||||
% of revenue | (74.4) | % | (454.5) | % | 24.9 | % | (452.7) | % | ||||||||||||||||
Basic (loss) income per share | $ | (0.11) | $ | (0.12) | (8.3)% | $ | 0.54 | $ | (0.30) | — | ||||||||||||||
Diluted (loss) income per share | $ | (0.11) | $ | (0.12) | (8.3)% | $ | 0.54 | $ | (0.30) | — | ||||||||||||||
Weighted average number of shares ('000) | ||||||||||||||||||||||||
Basic | 39,258 | 39,072 | 39,227 | 38,950 | ||||||||||||||||||||
Diluted | 39,258 | 39,072 | 39,288 | 38,950 | ||||||||||||||||||||
Notes:
(a) Percentage change is not applicable if either of the two periods contains a loss or no amount.
Financial Position | ||||||||||||
As of September 30, | As of December 31, | As of September 30, | ||||||||||
2021 | 2020 | 2020 | ||||||||||
Cash and cash equivalents(a) | $ | 70,378 | $ | 60,980 | $ | 72,075 | ||||||
Short-term investments(b) | $ | 51,374 | $ | 150,150 | $ | — | ||||||
Restricted cash | $ | 114,892 | $ | 2,065 | $ | 1,975 | ||||||
Real estate properties under development, net | $ | 317,939 | $ | 312,185 | $ | 385,227 | ||||||
Real estate properties held for sales type lease | $ | 7,434 | $ | 31,558 | $ | — | ||||||
Real estate properties held for lease, net | $ | 151,705 | $ | 92,207 | $ | 30,375 | ||||||
Property, plant and equipment, net | $ | 25,788 | $ | 26,568 | $ | 25,779 | ||||||
Total assets | $ | 770,779 | $ | 701,210 | $ | 536,561 | ||||||
Amount due to a shareholder | $ | 146,869 | $ | 146,869 | $ | — | ||||||
Current portion of long term bank loans | $ | 109,539 | $ | 122,883 | $ | 6,639 | ||||||
Accounts payable | $ | 70,672 | $ | 61,559 | $ | 52,573 | ||||||
Advance from customers | $ | 5,564 | $ | 69,722 | $ | 122,012 | ||||||
Contract liabilities | $ | 14,173 | $ | — | $ | — | ||||||
Long term bank loans | $ | 88,636 | $ | — | $ | 126,565 | ||||||
Total shareholders' equity | $ | 271,535 | $ | 248,828 | $ | 211,761 | ||||||
Total number of common shares issued | 39,258 | 39,198 | 39,198 | |||||||||
Notes:
(a) Cash and cash equivalents included all cash balances and certificates of deposit having a maturity date of three months or less upon acquisition.
(b) Short term investments included investments with original maturities of three months and less than 12 months, and investments that were expected to be realized in cash in the next 12 months. As of September 30, 2021, the Company had short term investments of principal amount of
SUPPLEMENTARY INFORMATION (UNAUDITED) IN THE THIRD QUARTER OF 2021
Key Highlights of Financial Position
As of September 30, | As of December 31, | As of September 30, | |||||||
2021 | 2020 | 2020 | |||||||
Current ratio(a) | 1.11 | 0.87 | 1.01 | ||||||
Debt ratio(b) | 64.8 | % | 64.5 | % | 60.5 | % | |||
Return on equity(c) | 8.1 | % | 6.8 | % | (7.4) | % | |||
Ratio of total liabilities to total equity | 1.84 | 1.82 | 1.53 |
Notes:
(a) Current ratio is calculated with all current assets divided by all current liabilities.
(b) Debt ratio is calculated with all total liabilities divided by total assets.
(c) Return on equity is calculated with consolidated net income (loss) divided by average of total shareholders' equity at beginning and end of the period.
FINANCIAL RESULTS
Revenue
Revenue for the third quarter of 2021 was
Gross Profit
Gross profit for the third quarter of 2021 was
Net (Loss) Income from Operations
Net loss from operations for the third quarter of 2021 was
Consolidated Net Income (Loss)
Consolidated net loss for the third quarter of 2021 was
Cash and Cash Equivalents
Cash and cash equivalents increased by
Restricted Cash
Restricted cash increased by
Contract Assets
Contract assets were
Real Estate Properties under Development, Net
Real estate properties under development, net increased by
Real Estate Properties Held for Sales Type Lease
Real estate properties held for sales type lease are stated at the lower of carrying amounts or fair value less selling costs. Real estate properties held for sales type lease decreased by
Real Estate Properties Held for Lease, Net
Real estate properties held for lease, net are recorded at cost less accumulated depreciation. Real estate properties held for lease, net increased by
Accounts Payable
Accounts payable increased by
Advance from Customers
Advance from customers decreased by
Contract liabilities
Contract liabilities were
Current Portion of Long Term Bank Loans
The current portion of long term bank loans decreased by
Long Term Bank Loans
Long-term bank loans were
Liquidity and Capital Resources
As of September 30, 2021, the Company had a total cash and cash equivalents of
Going Concern
The unaudited consolidated financial information of the Company for the third quarter of 2021 has been prepared on the assumption that the Company will continue as a going concern which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As of September 30, 2021, the Company had current portion of long term bank loan of
According to the Company's announcement dated September 14, 2021 Nam Tai Investment has entered into a loan agreement with Bank of Guangzhou for a loan facility of up to RMB1.06 billion (approximately
However, there are uncertainties pertaining to the management of the Company as a result of a special meeting of shareholders ordered to be convened on November 30, 2021. For more information, see "Recent Developments – Dispute with IsZo Capital LP". The current board of directors and management of the Company are committed to taking actions to preserve the best interests of all shareholders.
Please see the Company's Condensed Consolidated Statements of Comprehensive Income for further details. The information contained herein has also been published on the Company's website at https://www.namtai.com/quarterly/index.html.
BUSINESS OVERVIEW
Leasing and Pre-sale Progress
As of September 30, 2021, the Company had leasable area of approximately 365,000 square meters, of which around
The Company (through its subsidiary) obtained the pre-sale permits for Towers 1, 2 and 6 of Nam Tai • Longxi on July 30, 2021 and commenced the pre-sale of the first batch of 260 residential units which are equivalent to 27,899 square meters in gross floor area on August 4, 2021. As of September 30, the Company received earnest money from purchasers for a total of 78 units, or approximately 9,144 square meters in gross floor area. Although the Company will continue to make every endeavor to facilitate the pre-sale amid the liquidity issues, a success of the pre-sale is not guaranteed. Further, there is no assurance that the Company will receive payments regarding the pre-sale in a timely manner from the purchasers and/or their respective mortgagees, which may adversely affect the Company's liquidity and financial condition.
Projects | Leasable Area as of September 30, 2021 | Leased Area as of September 30, 2021 | Occupancy Rate | |
Shenzhen | 310,193 | 207,665 | ||
Nam Tai Inno Park | 264,337 | 181,096 | ||
Nam Tai Inno Valley | 38,270 | 19,814 | ||
Nam Tai • Tang Xi Technology Park | 7,586 | 6,755 | ||
Wuxi & Shanghai | 54,809 | 54,315 | ||
Wuxi facilities | 50,828 | 50,828 | ||
Nam Tai • U-Creative Space (Lujiazui) | 3,981 | 3,487 | ||
Total | 365,002 | 261,980 |
Project Construction and Development Progress
- For Nam Tai Technology Center, the masonry work for Towers A, B, C and D has been completed. Currently, the Company is conducting interior decoration for Towers A, B, C and working on plastering for Tower D. The pre-sale permit for the project has not been obtained.
- For Nam Tai Inno Valley, the Company is in the process of obtaining approval for the Company's urban renewal application. Before obtaining the approval from the local authorities, the Company will continue to lease the units in Inno Valley for short-term tenancy. The occupancy rate of Inno Valley was
52% as of September 30, 2021. - For Nam Tai • Longxi, the main structures of Towers 1, 2 and 6 was capped and masonry work is under way while the main structures of Towers 3, 4 and 5 are under construction.
Industrial Operation Progress
- In the third quarter of 2021, the Company continued to implement a comprehensive industry chain model and provided value-added services to the Company's corporate tenants through a number of industry events, which covered talent recruitment, technology facilitation, financing and policy consulting, aiming to support the growth of the Company's corporate tenants and the technology community.
- In respect of talent recruitment, the Company arranged a campaign with the theme "Month for Talent Service" in September 2021, under which a number of relevant activities were arranged to support the Company's corporate tenants in hiring talents and retaining employees. For example, in cooperation with Tongdao Liepin Group, the Company conducted a live webcast to help recruitment for 25 high-end job openings, attracting more than 12,000 online participants in September 2021.
- In respect of technology facilitation, in August 2021, the Company established the "QATIC Lean Production Empowerment Center" (in collaboration with Shenzhen Anche Shenghui Testing Technology Co., Ltd, a company listed on Shenzhen Stock Exchange), which as a platform will provide the Company's corporate tenants with reliability and failure analysis services for electronic components and product quality improvement services. In the same month, the Company built the "Biological Product Research and Development Platform" jointly with Shenzhen Tuopu Biotechnology Co., Ltd. and Shenzhen Research Institute of Xiamen University to provide biomedical enterprises with fundamental research and technical services involving synthetic biology.
- The Company's unique industrial service strategy and exceptional performance have been highly recognized by the local authorities. During the third quarter of 2021, a number of officials from the local authorities, including the Deputy Secretary of Guangming District Committee and members of the Guangming District Standing Committee, visited Nam Tai Inno Park and the branch of Guangming District Administration Service Center and praised the achievements of the Company's industrial services and corporate tenant attraction.
Awards
The Company is pleased to announce that in September 2021 Nam Tai Inno Park was awarded Gold Winner in lighting design of MUSE Design Awards, an award system created by the International Awards Association with a mission to honor, promote and encourage creativity. The awarding institution commented on the nighttime view of Inno Park, that "Combined with the overall architectural features, referring to many landmarks as the design intention, fully considering the commercial, office and residential night lighting design needs, precise control of color temperature, once again to achieve the state of light but not light." This award represents a strong endorsement of the Company's commitment to high-quality technology park and acknowledges the efforts Nam Tai has made on this important project.
Real Estate Market Update
China's property sector was cooling down in terms of sales and investment in the third quarter of 2021. The nationwide transacted gross floor area and the sales in September 2021 recorded a drop of
The performance of office and residential markets vary. The absorption of office space in gross floor area in Shenzhen increased by
From the policy perspective, in order to promote the healthy development of the housing market, the PRC government has been rolling out restrictive measures with the objective to curb the rapid price increase in housing and speculation activities. In the first half of 2021, PRC government implemented two policies in relation to real estate financing, among others, to regulate the financing activities of real estate developers, which are the "Three Red Lines" policy (liability to asset ratio (excluding advance receipt) being less than
In Dongguan's housing market, local government has also promulgated restrictive measures to curb the rapid rise in housing price. On August 2, 2021, Dongguan Housing and Urban-Rural Development Bureau issued the Notice on Further Regulating and Controlling the Real Estate Market to regulate the real estate market in terms of tightening residential unit buyer's restrictions, monitoring capital inflow to the property market, strengthening real estate tax supervision and regulation, establishing a second-hand housing transaction guidance price system, and strengthening commodity housing sales supervision. Further, in September 2021, Dongguan Natural Resources Bureau issued the Notice on Further Strict Bidding for Residential Land which stipulated that measures will be strictly carried out to examine the qualifications of land purchasers and strengthen the examination of the sources of funds for land purchase. In addition, in October 2021, Dongguan Municipal Bureau of Housing and Urban-Rural Development issued the Notice on the Establishment of a Mechanism for Issuing Reference Prices of Second-hand Housing Transactions, which stipulated that relevant institutions involved in second-hand housing transactions should take the reference prices of second-hand housing transactions as one of the reference bases for business development.
RECENT DEVELOPMENTS
Financing Update
According to the Company's announcement dated September 14, 2021, Nam Tai Investment has entered into a loan agreement with Bank of Guangzhou for a loan facility of up to RMB1.06 billion (approximately
In addition, the Company repaid the amount due to the Bank of Beijing and Industrial Bank in full in September 2021. The Company will continue its efforts to cure the defaults with other existing lenders and address the Company's liquidity issues progressively.
Dispute with IsZo Capital LP
On October 4, 2021, the Eastern Caribbean Court of Appeal in the British Virgin Islands (the "Court of Appeal") handed down a judgment (the "Appeal Judgment") dismissing the Company's appeal against the BVI Commercial Court's finding that, among other things, the Private Placement was void. The Court of Appeal upheld the Company's appeal against the finding of the BVI Commercial Court that the Company's directors acted in breach of section 120(1) of the BVI Business Companies Act 2004. Further, the Court of Appeal ordered the Company to hold a special meeting of shareholders regarding the removal and appointment of directors on November 30, 2021 (the "Proposed Special Meeting").
A consequential hearing regarding the Appeal Judgment was held on October 6, 2021 at which the Court of Appeal stayed its order directing the holding of the Proposed Special Meeting on condition that the Company file any application which it determined to make by October 18, 2021 for: (i) conditional leave to appeal to the Judicial Committee of the Privy Council of the United Kingdom (the "Privy Council"); (ii) a stay of execution to stay the Proposed Special Meeting pending the judgment on the Company's appeal to the Privy Council; and (iii) a variation of the order of the Court of Appeal dated October 4, 2021 (the "Three Applications"). Accordingly, the Company filed the Three Applications to the Court of Appeal on October 18, 2021 as directed. Further, on October 22, 2021, IsZo Capital LP filed application to the Court of Appeal for conditional leave to cross appeal to the Privy Council ("IsZo's Application"). The hearing by the Court of Appeal for the Three Applications and IsZo's Application is scheduled for November 8, 2021.
Supply Chain Finance Fund Managed by Credit Suisse (the "Fund")
The Company has placed
The Company will continue to negotiate with Credit Suisse and is committed to act in the best interest of the Company. The Company will take all necessary steps to recover the rest of the principal invested where appropriate and as advised by the Company's external counsel. However, there is no assurance that the Company can fully recover the Company's principal from the Fund.
Lawsuits filed by the Company's suppliers
As at the date of this announcement, relevant subsidiaries of the Company has received a total of nine writs of summons from our suppliers in the PRC seeking orders from the relevant PRC courts to settle the alleged outstanding construction fees/payments amounting to an aggregate of approximately RMB92.5 million, in which the respective PRC courts have issued rulings to freeze the bank accounts of the relevant subsidiaries of the Company amounting to approximately RMB21.4 million in relation to three of the aforementioned writs of summons. We are negotiating with the relevant suppliers, and seeking legal advice from external counsel to prepare for the upcoming hearings. Due to the continuous effort of the Company, two of our suppliers withdrew their respective lawsuits against the Company after negotiations, involving an amount of approximately RMB14.8 million, and we have reached a settlement with one of our suppliers.
OPERATING RESULTS
As of September 30, 2021 | ||
(By Floor Area) | (in square meter) | |
Project Completed | 331,701 | |
Project Under Development | 309,115 | |
Project For Future Development | 170,200 | |
Total | 811,016 |
Project Portfolio - As of September 30, 2021
Project | Nam Tai Inno Park | Nam Tai Technology Center | Nam Tai Inno Valley | Nam Tai • Longxi | ||||||||||
City | Shenzhen | Shenzhen | Shenzhen | Dongguan | ||||||||||
Type(a) | Office and Dormitory | Office and Dormitory | Office and Dormitory | Residential and Commercial Property | ||||||||||
Site Area (sq.m.) | 103,739 | 22,364 | 22,367 | 33,763 | ||||||||||
Capacity GFA | 265,139 | 139,746 | N/A | 84,408 | ||||||||||
Total GFA (sq.m.) | 331,701 | 194,595 | 170,200(b) | 114,520 | ||||||||||
Total GFA | Completed(c) | 331,701 | - | - | - | |||||||||
Under Development (sq.m.) | - | 194,595 | - | 114,520 | ||||||||||
Future Development (sq. m.) | - | - | 170,200(b) | - | ||||||||||
Interest Attributable To Us | ||||||||||||||
Address | Fenghuang Community, Guangming District, Shenzhen | Namtai Road, Baoan District, Shenzhen | Dongtai Village, Machong Town, Dongguan | |||||||||||
Notes:
(a) The types of the Company's projects are based on its development plans or certificates issued by the relevant authority subject to adjustment upon the final approval.
(b) The gross floor area is based on the assumption that the Company will receive M-0 zoning approval for the entire Inno Valley site prior to its redevelopment. If the Company does not receive the M-0 zoning approval, the Company will be required to develop Inno Valley under the M-1 zoning requirements. In that case, appropriate adjustments to the Company's plan will have to be made. The existing gross floor area of Inno Valley is 41,927 square meters. According to "Shenzhen Industrial Block Range Line Management Measures", the location of Nam Tai Inno Valley is within the designated industrial block range, of which the government strictly controls the proportion of M-0 zoning on industrial land. Therefore, the proportion of M-0 zoning, floor area ratio and construction area of Inno Valley are subject to the final approval of the government which is uncertain at this time. The Company cannot guarantee that the Company will be able to develop Inno Valley according to the floor area currently disclosed.
(c) Properties completed refer to the status following the completion of the construction of the properties, the registration of the completion acceptance and the internal acceptance criteria.
Properties Completed
The table below sets forth certain information of the Company's property projects completed as of September 30, 2021, comprising properties for which the registration of the completion acceptance was completed and the internal acceptance was satisfied.
Project | Nam Tai Inno Park | |
City | Shenzhen | |
Total GFA (sq. m.) | 331,701 | |
Leasable GFA (sq. m.) | 264,337 | |
Saleable GFA (sq. m.) | - | |
Commencement of Construction | May 2017 | |
Status of Pre-sale Permit | Not eligible | |
Completion Time | July 2021 | |
Interest Attributable to Us |
Properties Under Development
The table below sets forth certain information of the Company's property projects under development as of September 30, 2021, comprising properties under development with the foundation work construction permits obtained but the construction work was still in progress.
Project | Nam Tai Technology Center | Nam Tai • Longxi | ||
City | Shenzhen | Dongguan | ||
(Estimated) Total GFA (sq. m.) | 194,595 | 114,520 | ||
(Estimated) Leasable GFA (sq. m.) | - | - | ||
(Estimated) Saleable GFA (sq. m.) | 130,166 | 64,408(a) | ||
Commencement of Construction | December 2018 | July 2020 | ||
Status of Pre-sale Permit | To be obtained | Obtained(b) | ||
(Estimated) Completion Time | 2022 | 2022 | ||
Interest Attributable to Us |
Notes:
(a) Excluding parking space and construction area that needs to be handed over to the local government free of charge. The final floor area is subject to the approval of the government.
(b) The Company obtained the pre-sale permits for Towers 1, 2 and 6 of Nam Tai • Longxi on July 30, 2021.
Properties for Future Development
The table below sets forth certain information of the Company's property projects held for future development as of September 30, 2021, comprising properties for which the Company has obtained the land use right certificate and is in the process of obtaining the foundation work construction permits, or the Company has entered into land grant contracts or is in the process of applying for special planning although the land use right certificate is not yet obtained.
Project | Nam Tai Inno Valley | ||
City | Shenzhen | ||
Estimated Total GFA(1) (sq. m.) | 170,200 | ||
Estimated Completion Time | 2025 |
Note:
(1) The figures are subject to adjustment upon the final approval of the relevant authority.
Projects for Operation and Management
The table below sets forth certain information of the Company's projects leased from third parties for operation and management as of September 30, 2021.
Project | Location |
Contracted Floor Area (sq. m.) | Operation Model | ||||
1 | Nam Tai • Tang Xi Technology Park | Shenzhen | 7,586 | Tenant Recruitment and Operation | |||
2 | Nam Tai • U-Creative Space (Lujiazui) | Shanghai | 3,981 | Tenant Recruitment and Operation |
The information contained in, or that can be accessed through, the website mentioned in this announcement does not form part of the announcement.
FORWARD-LOOKING STATEMENTS AND FACTORS THAT COULD CAUSE THE COMPANY'S SHARE PRICE TO DECLINE
Certain statements included in this announcement, other than statements of historical fact, are forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may", "might", "can", "could", "will", "would", "anticipate", "believe", "continue", "estimate", "expect", "forecast", "intend", "plan", "seek", or "timetable". These forward-looking statements, which are subject to risks, uncertainties, and assumptions, may include projections of the Company's future financial performance based on the Company's growth strategies and anticipated trends in its business and the industry in which the Company operates. These statements are only predictions based on the Company's current expectations about future events. There are several factors, many beyond the Company's control, which could cause results to differ materially from the Company's expectation. These risk factors are described in the Company's Annual Report on Form 20-F and in the Company's Current Reports filed on Form 6-K from time to time and are incorporated herein by reference. Any of these factors could, by itself, or together with one or more other factors, adversely affect the Company's business, results of operations or financial condition. There may also be other factors currently unknown to the Company, or have not been described by the Company, that could cause the Company's results to differ from its expectations. Although the Company believes the expectations reflected in the forward-looking statements are reasonable, the Company cannot guarantee future results, levels of activity, performance, or achievements. Investors should not rely upon forward-looking statements as predictions of future events. These forward-looking statements apply only as of the date of this announcement; as such, they should not be unduly relied upon as circumstances change. Except as required by law, the Company is not obligated, and the Company undertakes no obligation, to release publicly any revisions to these forward-looking statements that might reflect events or circumstance occurring after the date of this announcement or those that might reflect the occurrence of unanticipated events.
CONFERENCE CALL INFORMATION
The Company will hold a conference call at 8 a.m. (Eastern Time) on November 8, 2021, in which the senior management will discuss the results for the third quarter of 2021. Investors may register and get access to the listen-only webcast through the link which can be found under "Investor News – Information and Activities – Investor Relations" on the Company's website at https://www.namtai.com/investornews/index.html. Please note that no question-and-answer session will be arranged during the call and investors are welcome to make enquiries by writing to the media and investor relations department of the Company by email at ir@namtai.com.cn or by contacting the Company's US-based public relations agent Edelman at Ira.grosky@edelman.com.
ABOUT NAM TAI PROPERTY INC.
Nam Tai is a real estate developer and operator, mainly conducting business in Mainland China. The Company's main land resources are located in the Guangdong-Hong Kong-Macao Greater Bay Area ("Greater Bay Area") and Wuxi, the PRC, of which the three plots of land in Shenzhen will be developed into the technology parks of Nam Tai Inno Park, Nam Tai Technology Center and Nam Tai Inno Valley. The Company plans to build these technology parks into landmark projects in the region, and provide high-quality industrial offices, industrial service spaces and supporting dormitories to the park tenants. Based on the experience of developing and operating technology parks, and the industrial relationship network accumulated over the past 40 years, the Company has also exported the operation mode of technology parks to other industrial properties using the asset-light model to rent industrial properties for repositioning and business invitation. Nam Tai will also expand the commercial and residential property business in the PRC as an auxiliary development strategy of the Company. As the growth prospects of the PRC maintain, the Company will actively seize development opportunities in the Greater Bay Area and other first- and second-tier cities in the PRC, and continue to strengthen and expand the business of industrial real estate, and commercial and residential properties.
Nam Tai Property Inc. is a corporation registered in the British Virgin Islands and listed on the New York Stock Exchange (Symbol: "NTP"). Please refer to the Nam Tai website (www.namtai.com) or the SEC website (www.sec.gov) for the Company's press releases and financial results.
NAM TAI PROPERTY INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
FOR THE PERIODS ENDED SEPTEMBER 30, 2021 AND 2020
(In Thousands of US dollars except share and per share data)
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||
Revenue | $ | 5,791 | 1,067 | $ | 84,385 | $ | 2,609 | |||||||||
Cost of revenue | (3,650) | (826) | (31,805) | (2,126) | ||||||||||||
Gross profit | $ | 2,141 | $ | 241 | $ | 52,580 | $ | 483 | ||||||||
Expenses | ||||||||||||||||
General and administrative expenses | (3,746) | (3,808) | (15,507) | (9,356) | ||||||||||||
Selling and marketing expenses | (1,669) | (2,208) | (4,413) | (5,113) | ||||||||||||
Total operating expenses | $ | (5,415) | $ | (6,016) | $ | (19,920) | $ | (14,469) | ||||||||
Net income (loss) from operations | $ | (3,274) | $ | (5,775) | $ | 32,660 | $ | (13,986) | ||||||||
Other income (expense), net | (1,756) | 43 | (1,420) | (16) | ||||||||||||
Interest income | 120 | 273 | 294 | 1,052 | ||||||||||||
Income (Loss) before income tax | $ | (4,910) | $ | (5,459) | $ | 31,534 | $ | (12,950) | ||||||||
Income tax (expense) benefit | 599 | 609 | (10,506) | 1,140 | ||||||||||||
Consolidated net income (loss) | $ | (4,311) | $ | (4,850) | $ | 21,028 | $ | (11,810) | ||||||||
Other comprehensive income (loss) (1) | (1,372) | 6,607 | 825 | 4,113 | ||||||||||||
Functional currency translation adjustment | (1,372) | 6,607 | 825 | 4,113 | ||||||||||||
Consolidated comprehensive income (loss) | $ | (5,683) | $ | 1,757 | $ | 21,853 | $ | (7,697) | ||||||||
Earnings (loss) Per Share | ||||||||||||||||
Basic | $ | (0.11) | $ | (0.12) | $ | 0.54 | $ | (0.30) | ||||||||
Diluted | $ | (0.11) | $ | (0.12) | $ | 0.54 | $ | (0.30) | ||||||||
Weighted average number of shares ('000) | ||||||||||||||||
Basic | 39,258 | 39,072 | 39,227 | 38,950 | ||||||||||||
Diluted | 39,258 | 39,072 | 39,288 | 38,950 | ||||||||||||
Notes:
(1) Other comprehensive loss was due to foreign exchange translation.
NAM TAI PROPERTY INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
AS AT SEPTEMBER 30, 2021 AND DECEMBER 31, 2020
(In Thousands of US dollars)
September 30, 2021 | December 31, 2020 | |||||||
(Unaudited) | (Audited) | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 70,378 | $ | 60,980 | ||||
Restricted cash | 114,892 | 2,065 | ||||||
Short term investments | 51,374 | 150,150 | ||||||
Rental deposits | 5 | 156 | ||||||
Accounts receivable | 4,778 | 3,965 | ||||||
Real estate properties under development, net | 142,740 | 121,693 | ||||||
Real estate properties held for sales type lease | 7,434 | 31,558 | ||||||
Prepaid expenses and other receivables | 11,175 | 7,141 | ||||||
Total current assets | $ | 402,776 | $ | 377,708 | ||||
Rental deposits | 340 | 287 | ||||||
Real estate properties under development, net | 175,199 | 190,492 | ||||||
Property, plant and equipment, net | 25,788 | 26,568 | ||||||
Real estate properties held for lease, net | 151,705 | 92,207 | ||||||
Contract assets | 50 | — | ||||||
Right of use assets | 9,341 | 9,695 | ||||||
Deferred income tax assets | 5,480 | 4,154 | ||||||
Other assets | 100 | 99 | ||||||
Total assets | $ | 770,779 | $ | 701,210 | ||||
LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
Current liabilities: | ||||||||
Current portion of long term bank loans | 109,539 | 122,883 | ||||||
Accounts payable | 70,672 | 61,559 | ||||||
Rental deposits from customers | 853 | 1,498 | ||||||
Accrued expenses and other payables | 28,865 | 30,136 | ||||||
Advance from customers | 5,564 | 69,722 | ||||||
Amount due to a shareholder | 146,869 | 146,869 | ||||||
Amount due to a related company | 950 | 161 | ||||||
Current portion of lease liabilities | 1,101 | 1,064 | ||||||
Total current liabilities | $ | 364,413 | $ | 433,892 | ||||
Long term bank loans | 88,636 | — | ||||||
Long term rental deposits | 2,584 | 300 | ||||||
Financing lease payable | 18 | 19 | ||||||
Contract liabilities | 14,173 | — | ||||||
Deferred income tax liabilities | 20,770 | 8,927 | ||||||
Noncurrent portion of lease liabilities | 8,650 | 9,244 | ||||||
Total liabilities | $ | 499,244 | $ | 452,382 | ||||
EQUITY | ||||||||
Shareholders' equity: | ||||||||
Common shares | 393 | 392 | ||||||
Additional paid-in capital | 265,937 | 265,084 | ||||||
Retained earnings (accumulated deficit) | 10,206 | (10,822) | ||||||
Accumulated other comprehensive loss(1) | (5,001) | (5,826) | ||||||
Total shareholders' equity | $ | 271,535 | $ | 248,828 | ||||
Total liabilities and shareholders' equity | $ | 770,779 | $ | 701,210 | ||||
Notes:
(1) Accumulated other comprehensive loss represented conversion differences in foreign currency statements.
NAM TAI PROPERTY INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE PERIODS ENDED SEPTEMBER 30, 2021 AND 2020
(In Thousands of US dollars)
Three months ended September 30, | Nine months ended September 30, | ||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||||||||||
Consolidated net (loss) income | $ | (4,311) | $ | (4,850) | $ | 21,028 | $ | (11,810) | |||||||||||||||||
Adjustments to reconcile consolidated net (loss) income to net cash provided by operating activities: | |||||||||||||||||||||||||
Depreciation and amortization | 1,543 | 526 | 3,826 | 1,303 | |||||||||||||||||||||
Amortization of right of use assets | 418 | 455 | 1,389 | 1307 | |||||||||||||||||||||
Share-based compensation expenses | 96 | (372) | 289 | 730 | |||||||||||||||||||||
Unrealized exchange loss (gain) | 315 | 16 | 212 | (12) | |||||||||||||||||||||
Deferred income tax benefit | (667) | (766) | 10,517 | (1,281) | |||||||||||||||||||||
Changes in assets and liabilities: | |||||||||||||||||||||||||
Increase in accounts receivable | (348) | (96) | (813) | (102) | |||||||||||||||||||||
(Increase) decrease in prepaid expenses and other receivables | (2,012) | (3,504) | (4,034) | 2,738 | |||||||||||||||||||||
Decrease (increase) in deposit | 155 | (10) | 98 | (188) | |||||||||||||||||||||
Increase in real estate properties under development | (24,398) | (5,045) | (34,689) | (107,857) | |||||||||||||||||||||
Increase (decrease) in accrued expenses and other payables | (207) | 3482 | (1,845) | (2,003) | |||||||||||||||||||||
Increase in accounts payable | 1,402 | 825 | 426 | 239 | |||||||||||||||||||||
Increase (decrease) in lease liabilities | 241 | (248) | (1,062) | (1,099) | |||||||||||||||||||||
Increase (decrease) in advance from customers | 322 | 26,128 | (64,158) | 54,370 | |||||||||||||||||||||
Decrease in contract assets | (50) | — | (50) | — | |||||||||||||||||||||
Increase in rental deposits from customers | 247 | 503 | 1,639 | 973 | |||||||||||||||||||||
Increase in contract liabilities | 14,173 | — | 14,173 | — | |||||||||||||||||||||
Increase in financing lease payable | — | 7 | — | 7 | |||||||||||||||||||||
Increase in amount due to a related company | 9 | — | 789 | — | |||||||||||||||||||||
Total adjustments | $ | (8,761) | $ | 21,901 | $ | (73,293) | $ | (50,875) | |||||||||||||||||
Net cash (used in) provided by operating activities | $ | (13,072) | $ | 17,051 | $ | (52,265) | $ | (62,685) | |||||||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||||||||||||||||
Payment of real estate properties under development | — | (29,315) | — | (40,860) | |||||||||||||||||||||
Purchase of property, plant & equipment | (161) | (280) | (477) | (677) | |||||||||||||||||||||
Decrease in short term investments | 15,288 | — | 98,776 | 2,166 | |||||||||||||||||||||
Net cash provided by (used in) investing activities | $ | 15,127 | $ | (29,595) | $ | 98,299 | $ | (39,371) | |||||||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||||||||||||||||
Repayment of bank loans | (11,639) | (30,362) | (14,223) | (38,497) | |||||||||||||||||||||
Proceeds from bank loans | 88,847 | 34,971 | 88,847 | 73,245 | |||||||||||||||||||||
Proceeds from shares issued for option exercise | — | 1,744 | 565 | 3,793 | |||||||||||||||||||||
Net cash provided by financing activities | $ | 77,208 | $ | 6,353 | $ | 75,189 | $ | 38,541 | |||||||||||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | $ | 79,263 | $ | (6,191) | $ | 121,223 | $ | (63,515) | |||||||||||||||||
Cash, cash equivalents and restricted cash at beginning of period | 104,960 | 69,225 | 63,045 | 130,218 | |||||||||||||||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 1,047 | 11,016 | 1,002 | 7,347 | |||||||||||||||||||||
Cash, cash equivalents and restricted cash at end of period | $ | 185,270 | $ | 74,050 | $ | 185,270 | $ | 74,050 | |||||||||||||||||
SUPPLEMENTARY INFORMATION ON CASH FLOWS | |||||||||||||||||||||||||
Cash and cash equivalents | $ | 70,378 | $ | 72,075 | $ | 70,378 | $ | 72,075 | |||||||||||||||||
Restricted cash | $ | 114,892 | $ | 1,975 | $ | 114,892 | $ | 1,975 | |||||||||||||||||
NAM TAI PROPERTY INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIODS ENDED SEPTEMBER 30, 2021 AND 2020
(In Thousands of US dollars)
- These financial statements, including the consolidated balance sheet as of December 31, 2020, which was derived from audited financial statements, do not include all of the information and notes required by U.S. Generally Accepted Accounting Principles for complete financial statements and should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company's annual report on Form 20-F for the fiscal year ended December 31, 2020.
- In the opinion of management, all adjustments (consisting of normal, recurring adjustments) considered necessary for a fair presentation have been included. Operating results for the interim periods presented are not necessarily indicative of the results that may be expected for the full year ending December 31, 2021.
- Accumulated other comprehensive loss represents foreign currency translation adjustments. The consolidated comprehensive income was
$21.9 million for the nine months ended September 30, 2021 and the consolidated comprehensive loss was$7.7 million for the nine months ended September 30, 2020. - A summary of the operating income, other (expenses) income, net (loss) income and long-lived assets by geographical areas is as follows:
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
RENTAL INCOME WITHIN: | ||||||||||||||||
-PRC, excluding Hong Kong | $ | 5,791 | $ | 1,067 | $ | 84,385 | $ | 2,609 | ||||||||
NET (LOSS) INCOME FROM OPERATIONS WITHIN: | ||||||||||||||||
- PRC, excluding Hong Kong | $ | (2,314) | $ | (2,970) | $ | 31,460 | $ | (7,243) | ||||||||
- Hong Kong | (1,997) | (1,880) | (10,432) | (4,567) | ||||||||||||
Total net (loss) income | $ | (4,311) | $ | (4850) | $ | 21,028 | $ | (11,810) | ||||||||
September 30, 2021 | December 31, 2020 | |||||||
LONG-LIVED ASSETS WITHIN: | ||||||||
- Real estate properties under development in PRC, excluding Hong Kong | $ | 175,199 | $ | 190,492 | ||||
- Property, plant and equipment in PRC, excluding Hong Kong | 25,608 | 26,389 | ||||||
- Hong Kong | 180 | 179 | ||||||
- Real estate properties held for lease in PRC, excluding Hong Kong | 151,705 | 92,207 | ||||||
- Right of use assets in PRC, excluding Hong Kong | 8,859 | 9,511 | ||||||
- Hong Kong | 482 | 184 | ||||||
Total long-lived assets | $ | 362,033 | $ | 318,962 | ||||
View original content:https://www.prnewswire.com/news-releases/nam-tai-property-inc-announces-q3-2021-results-301416543.html
SOURCE Nam Tai Property Inc.
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