Highlights for the Second Quarter Ended December 31, 2009 -- Net revenues in the second quarter were $42.4 million, an increase of 15.1% from $36.8 million for the same period last year -- Gross profit margin (non-GAAP) in the second quarter was 54.0%, compared to 54.9% for the same period last year -- Operating income and margins (non-GAAP) in the second quarter were $17.0 million or 40.1%, compared to $15.4 million or 41.9% for the same period last year -- Net income and margins (non-GAAP) in the second quarter were $13.8 million or 32.4%, compared to $12.5 million or 34.0% for the same period last year -- Diluted earnings per Share (non-GAAP) in the second quarter was $0.47 -- On November 6, 2009 Duoyuan Printing completed an initial public offering from which the Company received aggregate net proceeds of approximately $42 million
"I am pleased to report that Duoyuan Printing has again delivered strong
results in the first reporting period since our successful IPO in November,
further building on our history of revenue growth and profitability," said Mr.
"Duoyuan Printing delivered another solid quarter of revenue growth and
high margins, due to increased sales of multicolor printing presses combined
with continued efficiency gains from our vertically integrated production
facilities," commented Mr.
Three Months Ended
Duoyuan Printing's net revenues for the three months ended
Gross profit (non-GAAP) for the three months ended
Selling expenses (non-GAAP) were
General and administrative expenses (non-GAAP) were
Research and development expenses (non-GAAP) for the three months ended
Operating income (non-GAAP) was
Net income (non-GAAP) was
Income tax provision was
As of
Six Months Ended
For the six months ended
Business Outlook
Our business is affected by seasonality in that typically the quarter
ending
Based on information available as of
Non-GAAP Financial Measures:
In addition to the results reported in accordance with accounting
principles generally accepted in
We believe that these non-GAAP measures provide useful information to management and investors regarding financial and business trends relating to our financial condition and results of operations. We believe that these non-GAAP measures, in combination with our financial results calculated in accordance with GAAP, provide investors with additional perspective regarding the impact of certain share-based compensation expenses and changes in fair value of derivative instruments. We further believe that these excluded items do not accurately reflect the underlying performance of our continuing operations for the periods in which they are incurred, even though some of these excluded items may be incurred and reflected in the Company's GAAP financial results in the foreseeable future.
Cautions on Use of Non-GAAP Measures
As noted above, these non-GAAP financial measures are not consistent with GAAP because they do not reflect certain share-based compensation expenses and changes in fair value of derivative instruments. Management believes investors will benefit from greater transparency in referring to these non-GAAP financial measures when assessing the Company's operating results, as well as when forecasting and analyzing future periods. However, management recognizes that:
-- these non-GAAP financial measures are limited in their usefulness and should be considered only as a supplement to the Company's GAAP financial measures; -- these non-GAAP financial measures should not be considered in isolation from, or as a substitute for, the Company's GAAP financial measures; -- these non-GAAP financial measures should not be considered to be superior to the Company's GAAP financial measures; and -- these non-GAAP financial measures were not prepared in accordance with GAAP and investors should not assume that the non-GAAP financial measures presented in this earnings release were prepared under a comprehensive set of rules or principles.
Further, these non-GAAP financial measures may be unique to the Company, as they may be different from non-GAAP financial measures used by other companies. As such, this presentation of non-GAAP financial measures may not enhance the comparability of the Company's results to the results of other companies.
A reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure or measures appears at the end of this press release.
Conference Call
A conference call to discuss second quarter results is scheduled for
International: +656-735-7955 US: +1-718-354-1231 UK: +0808-234-6646 Hong Kong: +852-2475-0994
Please dial-in 10 minutes before the call is scheduled to begin and provide the passcode to join the call. The passcode is: 52376354
A replay of the conference call may be accessed by phone at the following
number until
International: +61-2-8235-5000
Passcode: 52376354
Additionally, a live and archived webcast of the conference call will be available at http://ir.duoyuan.com .
About Duoyuan Printing
Duoyuan Printing (NYSE: DYP) is a leading manufacturer of commercial
offset printing presses in
Safe Harbor Statement
This press release contains "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934 that involve risks, uncertainties and
assumptions. All statements other than statements of historical fact in this
press release are forward-looking statements, including but not limited to,
our future financial condition or results of operation, the completion of
planned improvements to our
For investor and media enquiries please contact: Duoyuan Printing, Inc. William Suh, CFO Phone: +86-10-6021-2222 (Beijing) Email: ir@duoyuan.com Brunswick Group Philip Lisio Phone: +86-10-6566-2256 Michael Fuchs Phone: +86-10-6566-2256 Email: duoyuanprinting@brunswickgroup.com DUOYUAN PRINTING, INC. AND SUBSIDIARIES (FORMERLY KNOWN AS ASIAN FINANCIAL, INC.) CONSOLIDATION STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME FOR THE THREE MONTHS AND SIX MONTHS ENDED DECEMBER 31, 2009 AND 2008 (UNAUDITED) Three months ended Six months ended December 31, December 31, 2009 2008 2009 2008 REVENUES, net $42,408,047 $36,837,283 $75,702,970 $63,016,714 COST OF REVENUES 19,564,713 16,609,073 35,353,104 28,939,825 GROSS PROFIT 22,843,334 20,228,210 40,349,866 34,076,889 RESEARCH AND DEVELOPMENT EXPENSES 628,674 490,084 992,833 1,184,601 SELLING EXPENSES 3,908,445 2,952,037 7,064,821 5,498,952 GENERAL AND ADMINISTRATIVE EXPENSES 3,628,448 1,344,637 5,118,646 2,276,335 INCOME FROM OPERATIONS 14,677,767 15,441,452 27,173,566 25,117,001 CHANGE IN FAIR VALUE OF DERIVATIVE INSTRUMENTS (3,344,611) 108,669 (3,233,996) 164,076 OTHER INCOME (EXPENSE), net Non-operating expenses -- (956,936) -- (956,936) Interest expense (211,737) (213,664) (446,126) (426,739) Interest income and other income 40,280 35,708 71,927 69,187 Other expense, net (171,457) (1,134,892) (374,199) (1,314,488) INCOME BEFORE PROVISION FOR INCOME TAXES AND NONCONTROLLING INTEREST 11,161,699 14,415,229 23,565,371 23,966,589 PROVISION FOR INCOME TAXES 2,849,832 1,604,339 5,258,478 2,531,130 NET INCOME 8,311,867 12,810,890 18,306,893 21,435,459 Less: Net income attributable to noncontrolling interest 223,951 168,986 381,904 278,723 NET INCOME ATTRIBUTABLE TO DUOYUAN PRINTING, INC. 8,087,916 12,641,904 17,924,989 21,156,736 OTHER COMPREHENSIVE INCOME Foreign currency translation gain 1,810 308,470 185,027 564,737 COMPREHENSIVE INCOME ATTRIBUTABLE TO DUOYUAN PRINTING, INC. $8,089,726 $12,950,374 $18,110,016 $21,721,473 BASIC WEIGHTED AVERAGE NUMBER OF SHARES 28,367,934 25,000,050 26,683,992 25,000,050 DILUTED WEIGHTED AVERAGE NUMBER OF SHARES 29,202,495 25,000,050 27,101,273 25,000,050 BASIC EARNING PER SHARE $0.29 $0.51 $0.67 $0.85 DILUTED EARNING PER SHARE $0.28 $0.51 $0.66 $0.85 DUOYUAN PRINTING, INC. AND SUBSIDIARIES (FORMERLY KNOWN AS ASIAN FINANCIAL, INC.) CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2009 AND JUNE 30, 2009 December 31, June 30, 2009 2009 (Unaudited) ASSETS CURRENT ASSETS: Cash $96,743,881 $31,044,070 Accounts receivable, net of allowance for doubtful accounts of $1,612,406 and $1,401,689 as of December 31, 2009 and June 30, 2009, respectively 43,668,616 37,259,616 Inventories 25,150,892 25,883,242 Other current assets 570,703 26,912 Total current assets 166,134,092 94,213,840 PLANT AND EQUIPMENT, net 41,826,421 43,123,153 OTHER ASSETS: Intangible assets, net 3,904,742 3,939,476 Advances on equipment purchases 7,284,609 7,274,677 Total other assets 11,189,351 11,214,153 Total assets $219,149,864 $148,551,146 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Lines of credit $14,376,600 $14,357,000 Accounts payable 1,292,853 756,116 Accrued liabilities 3,017,033 2,251,419 Taxes payable 4,821,371 1,512,727 Total current liabilities 23,507,857 18,877,262 Derivative instrument liabilities 5,136,268 1,180,477 Total Liabilities 28,644,125 20,057,739 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY: Preferred stock; $0.001 par value; 1,000,000 shares authorized; no shares issued and outstanding as of December 31, 2009 and June 30, 2009 -- -- Common stock; $0.001 par value; 100,000,000 shares authorized; 30,563,217 shares issued and outstanding as of December 31, 2009 and 25,000,050 shares issued and outstanding as of June 30, 2009 30,563 25,000 Additional paid-in capital 70,272,694 27,263,040 Statutory reserves 11,179,137 9,428,573 Retained earnings 95,903,555 79,226,497 Accumulated other comprehensive income 10,973,612 10,788,585 Total Duoyuan Printing, Inc. shareholders' equity 188,359,561 126,731,695 NONCONTROLLING INTEREST 2,146,178 1,761,712 Total equity 190,505,739 128,493,407 Total liabilities and equity $219,149,864 $148,551,146 DUOYUAN PRINTING, INC. AND SUBSIDIARIES (FORMERLY KNOWN AS ASIAN FINANCIAL, INC.) CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Common Stock Retained earnings Additional Number of paid-in Statutory shares Amount capital reserves Unrestricted BALANCE, June 30, 2008 25,000,050 $25,000 $27,263,040 $6,000,090 $50,058,176 Net income 21,156,736 Adjustment to statutory reserves 3,558,242 (3,558,242) Foreign currency translation adjustments BALANCE, December 31, 2008 (Unaudited) 25,000,050 $25,000 $27,263,040 $9,558,332 $67,656,670 Net income 11,440,068 Adjustment to statutory reserves (129,759) 129,759 Foreign currency translation adjustments BALANCE, June 30, 2009 25,000,050 $25,000 $27,263,040 $9,428,573 $79,226,497 Cumulative effect of reclassifi- cation of warrants (2,234,538) 502,633 BALANCE, July 1, 2009, as adjusted 25,000,050 $25,000 $25,028,502 $9,428,573 $79,729,130 Issuance of ordinary shares in connection with Initial Public Offering, net of offering costs 5,500,000 5,500 41,910,036 Stock-based compensation 2,324,109 Issuance of ordinary shares in connection with cashless exercise of warrants 63,167 63 1,010,047 Net income 17,924,989 Adjustment to statutory reserves 1,750,564 (1,750,564) Foreign currency translation adjustments BALANCE, December 31, 2009 (Unaudited) 30,563,217 $30,563 $70,272,694 $11,179,137 $95,903,555 Accumulated other comprehensive Noncontrolling income Interest Total BALANCE, June 30, 2008 $10,460,031 $1,292,843 $95,099,180 Net income 278,723 21,435,459 Adjustment to statutory reserves -- Foreign currency translation adjustments 564,737 7,603 572,340 BALANCE, December 31, 2008 (Unaudited) $11,024,768 $1,579,169 $117,106,979 Net income 184,830 11,624,898 Adjustment to statutory reserves -- Foreign currency translation adjustments (236,183) (2,287) (238,470) BALANCE, June 30, 2009 $10,788,585 $1,761,712 $128,493,407 Cumulative effect of reclassification of warrants (1,731,905) BALANCE, July 1, 2009, as adjusted $10,788,585 $1,761,712 $126,761,502 Issuance of ordinary shares in connection with Initial Public Offering, net of offering costs 41,915,536 Stock-based compensation 2,324,109 Issuance of ordinary shares in connection with cashless exercise of warrants 1,010,110 Net income 381,904 18,306,893 Adjustment to statutory reserves -- Foreign currency translation adjustments 185,027 2,562 187,589 BALANCE, December 31, 2009 (Unaudited) $10,973,612 $2,146,178 $190,505,739 DUOYUAN PRINTING, INC. AND SUBSIDIARIES (FORMERLY KNOWN AS ASIAN FINANCIAL, INC.) CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED DECEMBER 31, 2009 AND 2008 (UNAUDITED) 2009 2008 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $17,924,989 $21,156,736 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Noncontrolling interest 381,904 278,723 Depreciation 1,819,403 1,345,191 Amortization 40,096 40,038 Bad debt expense 208,718 -- Change in fair value of derivative instruments 3,233,997 (164,076) Stock-based compensation 2,324,109 -- Changes in operating assets and liabilities: Accounts receivable (6,564,255) (3,241,285) Inventories 768,133 (1,391,945) Other current assets (543,538) 657,362 Accounts payable 535,485 (103,601) Accrued liabilities 763,620 431,899 Taxes payable 3,305,225 1,596,550 Net cash provided by operating activities 24,197,886 20,605,592 CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of equipment (464,353) (1,408,404) Advances on equipment purchases -- (9,865,535) Payments for construction-in-progress -- (172,302) Net cash used in investing Activities (464,353) (11,446,241) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from lines of credit 12,900,800 12,885,840 Payments for lines of credit (12,900,800) (9,957,240) Proceeds from Initial Public Offering, net of offering costs 41,915,536 -- Net cash provided by financing activities 41,915,536 2,928,600 EFFECT OF EXCHANGE RATE CHANGES ON CASH 50,742 113,511 INCREASE IN CASH 65,699,811 12,201,462 CASH, beginning of period 31,044,070 14,199,700 CASH, end of period $96,743,881 $26,401,162 DUOYUAN PRINTING, INC. AND SUBSIDIARIES (FORMERLY KNOWN AS ASIAN FINANCIAL, INC.) RECONCILIATION OF GAAP TO NON-GAAP RESULTS OF OPERATIONS FOR THE THREE MONTHS AND SIX MONTHS ENDED DECEMBER 31, 2009, AND 2008 (UNAUDITED) Three months ended Six months ended December 31, December 31, 2009 2008 2009 2008 GAAP COST OF REVENUE $19,564,713 $16,609,073 $35,353,104 $28,939,825 Adjustments: Stock-based compensation (51,019) -- (51,019) -- NON-GAAP COST OF REVENUE 19,513,694 16,609,073 35,302,085 28,939,825 GAAP GROSS PROFIT 22,843,334 20,228,210 40,349,866 34,076,889 GAAP GROSS MARGIN 53.9% 54.9% 53.3% 54.1% Adjustments: Stock-based compensation 51,019 -- 51,019 -- NON-GAAP GROSS PROFIT 22,894,353 20,228,210 40,400,885 34,076,889 NON-GAAP GROSS MARGIN 54.0% 54.9% 53.4% 54.1% GAAP RESEARCH AND DEVELOPMENT EXPENSES 628,674 490,084 992,833 1,184,601 Adjustments: Stock-based compensation (95,989) -- (95,989) -- NON-GAAP RESEARCH AND DEVELOPMENT EXPENSES 532,685 490,084 896,844 1,184,601 GAAP SELLING EXPENSES 3,908,445 2,952,037 7,064,821 5,498,952 Adjustments: Stock-based compensation (139,831) -- (139,831) -- NON-GAAP SELLING EXPENSES 3,768,614 2,952,037 6,924,990 5,498,952 GAAP GENERAL AND ADMINISTRATIVE EXPENSES 3,628,448 1,344,637 5,118,646 2,276,335 Adjustments: Stock-based compensation (2,037,270) -- (2,037,270) -- NON-GAAP GENERAL AND ADMINISTRATIVE EXPENSES 1,591,178 1,344,637 3,081,376 2,276,335 OPERATING INCOME 14,677,767 15,441,452 27,173,566 25,117,001 Adjustments: Stock-based compensation 2,324,109 -- 2,324,109 -- NON-GAAP OPERATING INCOME 17,001,876 15,441,452 29,497,675 25,117,001 NET INCOME 8,087,916 12,641,904 17,924,989 21,156,736 Adjustments: Change in fair value of derivative instruments 3,344,611 (108,669) 3,233,996 (164,076) Stock-based compensation 2,324,109 -- 2,324,109 -- NON-GAAP NET INCOME $13,756,636 $12,533,235 $23,483,094 $20,992,660 NON-GAAP Earnings per share: Basic $0.48 $0.50 $0.88 $0.84 Diluted $0.47 $0.50 $0.87 $0.84 Weighted average number of shares outstanding: Basic 28,367,934 25,000,050 26,683,992 25,000,050 Diluted 29,202,495 25,000,050 27,101,273 25,000,050 DUOYUAN PRINTING, INC. AND SUBSIDIARIES (FORMERLY KNOWN AS ASIAN FINANCIAL, INC.) NON-GAAP CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME FOR THE THREE MONTHS AND SIX MONTHS ENDED DECEMBER 31, 2009, AND 2008 (UNAUDITED) Three months ended Six months ended December 31, December 31, 2009 2008 2009 2008 REVENUES, net $42,408,047 $36,837,283 $75,702,970 $63,016,714 COST OF REVENUES 19,513,694 16,609,073 35,302,085 28,939,825 GROSS PROFIT 22,894,353 20,228,210 40,400,885 34,076,889 RESEARCH AND DEVELOPMENT EXPENSES 532,685 490,084 896,844 1,184,601 SELLING EXPENSES 3,768,614 2,952,037 6,924,990 5,498,952 GENERAL AND ADMINISTRATIVE EXPENSES 1,591,178 1,344,637 3,081,376 2,276,335 INCOME FROM OPERATIONS 17,001,876 15,441,452 29,497,675 25,117,001 CHANGE IN FAIR VALUE OF DERIVATIVE INSTRUMENTS OTHER INCOME (EXPENSE), net Non-operating expenses (956,936) (956,936) Interest expense (211,737) (213,664) (446,126) (426,739) Interest income and other income 40,280 35,708 71,927 69,187 Other expense, net (171,457) (1,134,892) (374,199) (1,314,488) INCOME BEFORE PROVISION FOR INCOME TAXES AND NONCONTROLLING INTEREST 16,830,419 14,306,560 29,123,476 23,802,513 PROVISION FOR INCOME TAXES 2,849,832 1,604,339 5,258,478 2,531,130 NET INCOME 13,980,587 12,702,221 23,864,998 21,271,383 Less: Net income attributable to non- controlling interest 223,951 168,986 381,904 278,723 NET INCOME ATTRIBUTABLE TO DUOYUAN PRINTING, INC. 13,756,636 12,533,235 23,483,094 20,992,660 OTHER COMPREHENSIVE INCOME Foreign currency translation gain 1,810 308,470 185,027 564,737 COMPREHENSIVE INCOME ATTRIBUTABLE TO DUOYUAN PRINTING, INC. $13,758,446 $12,841,705 $23,668,121 $21,557,397 BASIC WEIGHTED AVERAGE NUMBER OF SHARES 28,367,934 25,000,050 26,683,992 25,000,050 DILUTED WEIGHTED AVERAGE NUMBER OF SHARES 29,202,495 25,000,050 27,101,273 25,000,050 BASIC EARNING PER SHARE $0.48 $0.50 $0.88 $0.84 DILUTED EARNING PER SHARE $0.47 $0.50 $0.87 $0.84
SOURCE Duoyuan Printing, Inc.