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Zuoan Fashion Limited Announces Fourth Quarter And Full Year 2010 Financial Results

Stocks in this article: ZA

Safe Harbor

This news release may contain forward-looking information about Zuoan Fashion Limited, which is covered under the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not historical facts. These statements can be identified by the use of forward- looking terminology such as believe, expect, may, will, should, project, plan, seek, intend, or anticipate or the negative thereof or comparable terminology, and include discussions of strategy, and statements about industry trends and Zuoan Fashion Limited's future performance, operations, and products.

Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Actual performance results may vary significantly from expectations and projections. Further information regarding this and other risk factors are contained in Zuoan’s public filings with the U.S. Securities and Exchange Commission.

All information provided in this news release and in any attachments is as of the date of the release, and the companies do not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under law.

   

ZUOAN FASHION LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

 
Three months ended December 31 Year ended December 31
2009   2010   2010 2009   2010   2010
RMB RMB US$ RMB RMB US$
(in thousands)
Revenues: 203,396 258,207 39,122 693,089 872,085 132,134
Cost of goods sold: (117,604)   (154,368) (23,389) (411,165)   (515,158) (78,054)
Gross profit 85,792 103,839 15,733 281,924 356,927 54,080
Other income 517 262 40 898 868 132
Selling, marketing and distribution expenses (25,361) (17,269) (2,617) (53,373) (61,486) (9,316)
General and administrative expenses (8,543) (9,497) (1,439) (22,176) (37,382) (5,664)
Finance costs (328)   (2,539) (385) (1,018)   (8,602) (1,303)
Profit before taxation 52,077 74,796 11,333 206,255 250,325 37,928
Income tax expenses (13,533)   (19,478) (2,951) (52,357)   (67,324) (10,201)
Profit after taxation 38,544 55,318 8,382 153,898 183,001 27,727
 

Other comprehensive (loss)/profit:

Foreign exchange difference arising from translation of foreign currency financial statements

(26)   769 117 (27)   1,555 236
Total comprehensive income for the year 38,518   56,087 8,498 153,871   184,556 27,963
 
Earnings per share (RMB):
Basic and diluted earnings per share 0.48 0.69 0.10 1.92 2.29 0.35
 
Pro forma earnings per share:
Diluted earnings per share 0.46 0.66 0.10 1.85 2.19 0.33
 
Basic and diluted no. of shares (‘000) 80,000 80,000 80,000 80,000
 
Pro forma weighted average diluted no. of shares (‘000) 83,562 86,722 83,366 86,515
 
 

ZUOAN FASHION LIMITED

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET

 
As of December 31

 

As of December 31

(in thousands) 2009  

2010

  2010
ASSETS RMB RMB  

US$

 
Non-current assets
Property, plant and equipment 2,043 2,720 412
Deferred offering costs -   5,757   872
2,043   8,477   1,284
Current assets
Inventories 17,409 22,339 3,385
Trade and other receivables 215,454 249,857 37,857
Prepayments 2,409 2,313 350
Fixed deposits – pledged 2,175 1,054 160
Cash and cash equivalents 141,569   367,731   55,717
379,016   643,294   97,469
Total assets 381,059   651,771   98,753
 
EQUITY AND LIABILITIES
 
Share capital 1 134 20
Share premium 129,599 129,599 19,636
Reserves 16,653 19,360 2,933
Retained profits / (deficit) 132,894   314,610   47,668
Total equity 279,147   463,703   70,258
 
LIABILITIES
 
Current liabilities
Trade and other payables 51,496 70,582 10,694
Interest-bearing bank borrowings 17,050 56,700 8,591
Convertible loans 19,439 40,961 6,206
Current income tax payable 13,927   19,825   3,004
Total liabilities 101,912   188,068   28,495
 
Total equity and liabilities 381,059   651,771   98,753
 
 

ZUOAN FASHION LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASHFLOWS

   
Year ended December 31

Year ended December 31

2009 2010   2010
(in thousands) RMB RMB US$
Cash flows from operating activities
Profit before taxation 206,255 250,325 37,928
Adjustments for :
Depreciation of property, plant and equipment 780 680 103
Loss on disposal of property, plant and equipment 7 -
Interest expenses on bank borrowings 1,018 2,332 353
Interest expense on convertible loans - 6,270 950
Interest income (504)   (868)   (132)
 
Operating profit before working capital changes 207,556 258,739 39,203
Increase in inventories (9,090) (4,930) (747)
Increase in trade and other receivables (73,388) (34,403) (5,213)
Increase in prepayments (2,436) (5,661) (858)
Decrease in fixed deposits pledged 3,730 1,121 170
Increase/(Decrease) in trade and other payables (35,238)   14,371   2,177
Cash generated from operations 91,134 229,237 34,733
Interest paid (1,018) (2,332) (353)
Income tax paid (48,844)   (61,426)   (9,307)
Net cash generated from operating activities 41,272   165,479   25,073
 
Cash flows from investing activities
Acquisition of property, plant and equipment (271) (1,357) (206)
Interest received 504   868   132
Net cash (used in)/generated from investing activities 233   (489)   (74)
 
 
Cash flows from financing activities
Bank loans obtained 18,550 57,700 8,742
Repayment of bank loans (8,550) (18,050) (2,735)
Convertible loan obtained 19,439   21,522   3,261
Net cash generated from financing activities 29,439   61,172   9,268
 
Net increase in cash and cash equivalents 70,944 226,162 34,267
Cash and cash equivalents at beginning 70,625   141,569   21,450
Cash and cash equivalents at end 141,569   367,731   55,717
 




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