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TheStreet Open House

Zuoan Fashion Limited Announces First Quarter 2011 Financial Results

Stocks in this article: ZA

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 March 31
2010   2011   2011
RMB RMB US$
(in thousands)
Revenues 146,822 211,525 32,302
Cost of goods sold (85,750) (123,563) (18,869)
Gross profit 61,072 87,962 13,433
Other income 150 398 61
Selling, marketing and distribution expenses (17,076) (10,361) (1,582)
General and administrative expenses (8,145) (11,809) (1,803)
Finance costs (1,739) (945) (144)
Profit before taxation 34,262 65,245 9,964
Income tax expenses (13,086) (17,423) (2,661)
Profit after taxation 21,176 47,822 7,303
 
Other comprehensive loss:

Foreign exchange difference arising from translation of foreign currency financial statements

(45) (490) (75)
Total comprehensive income for the period 21,131 47,332 7,228
 
Earnings per share (RMB):
Basic earnings per share 0.26 0.50 0.08
Diluted earnings per share 0.26 0.49 0.07
 
Weighted average basic no. of shares (‘000) 80,000 95,487
Weighted average diluted no. of shares (‘000) 85,915 97,915
 

Note: Diluted earnings per share for the three months ended March 31, 2010 are pro forma result as adjusted to reflect the dilutive impact of the convertible loans assuming that would be issuable. Pro forma diluted earnings per share for the three months ended March 31, 2010 reflects an adjustment to increase profit after taxation by approximately RMB1,500,000 for the effect of the interest related to the convertible loans.

 
ZUOAN FASHION LIMITED
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
     
As of December 31

 

As of March 31

(in thousands) 2010 2011 2011
ASSETS RMB RMB US$
 
Non-current assets
Property, plant and equipment 2,720 2,517 384
Deferred offering costs 5,757 - -
8,477 2,517 384
Current assets
Inventories 22,339 41,460 6,331
Trade and other receivables 249,857 161,600 24,678
Prepayments 2,313 1,800 275
Fixed deposits – pledged 1,054 1,358 207
Cash and cash equivalents 367,731 734,267 112,131
643,294 940,485 143,623
Total assets 651,771 943,002 144,007
 
EQUITY AND LIABILITIES
 
Share capital 134 184 28
Share premium 129,599 419,916 64,126
Reserves 19,360 20,091 3,068
Retained profits 314,610 362,432 55,347
Total equity 463,703 802,623 122,570
 
LIABILITIES
 
Current liabilities
Trade and other payables 70,582 68,812 10,508
Interest-bearing bank borrowings 56,700 53,750 8,208
Convertible loans 40,961 - -
Current income tax payable 19,825 17,817 2,721
Total liabilities 188,068 140,379 21,437
 
Total equity and liabilities 651,771 943,002 144,007
 
 

ZUOAN FASHION LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASHFLOWS

 
Three months ended March 31
2010   2011   2011
(in thousands) RMB RMB US$
Cash flows from operating activities
Profit before taxation 34,262 65,245 9,964
Adjustments for :
Depreciation of property, plant and equipment 167 210 32
Equity-settled employees benefit expenses - 1,221 186
Interest expenses on bank borrowings 278 945 144
Interest expense on convertible loans 1,461 - -
Interest income (150) (398) (61)
 
Operating profit before working capital changes 36,018 67,223 10,266
Increase in inventories (63,401) (19,121) (2,920)
Decrease in trade and other receivables 60,484 88,257 13,478
Decrease/(Increase) in prepayments (776) 6,270 958
Increase in fixed deposits pledged (571) (304) (46)
Increase/(Decrease) in trade and other payables (104) 3,725 569
Cash generated from operations 31,650 146,050 22,303
Interest paid (278) (945) (144)
Income tax paid (13,534) (19,431) (29,67)
Net cash generated from operating activities 17,838 125,674 19,192
 
Cash flows from investing activities
Acquisition of property, plant and equipment - (7) (1)
Interest received 150 398 61
Net cash generated from investing activities 150 391 60
 
 
Cash flows from financing activities
Bank loans obtained - 2,150 328
Repayment of bank loans (750) (5,100) (779)
Issuance of ordinary shares - 40 6
Net IPO proceeds - 243,381 37,167
Convertible loan obtained 19,482 - -
Net cash generated from financing activities 18,732 240,471 36,723
 
Net increase in cash and cash equivalents 36,720 366,536 55,974
Cash and cash equivalents at beginning 141,569 367,731 56,157
Cash and cash equivalents at end 178,289 734,267 112,131
 




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