China HGS Reports Second Quarter of Fiscal Year 2014 Results - Revenues Up by Approximately 157.5% PR Newswire HANZHONG, China, May 9, 2014 HANZHONG,China, May 9, 2014 /PRNewswire/ -- China HGS Real Estate Inc. (NASDAQ: HGSH) ("China HGS" or the "Company"), a leading regional real estate developer headquartered in Hanzhong City, Shaanxi Province, China, today reported its financial results for the second quarter of fiscal 2014 ended March 31, 2014 with the U.S. Securities and Exchange Commission. An electronic copy of the quarterly report on Form 10-Q can be accessed on the SEC's website atwww.sec.gov. Highlights for the Quarter oTotal revenues for the second quarter of fiscal 2014 were approximately $49.9 million, an increase of 157.5% from approximately $19.4 million in the same quarter of fiscal 2013. Total revenues recognized from percentage of completion method were approximately $33.5 million, which accounted for 67.2% of total revenues in the second quarter of fiscal 2014. oNet income for the second quarter of fiscal 2014 totaled approximately $13.4 million, an increase of approximately $7.7 million from the net income of approximately $5.8 million in the same period of last year. The increased net income in this quarter compared to the same quarter of last year was primarily due to the significantly increased revenue. oBasic and diluted net earnings per share ("EPS") attributable to shareholders for the second quarter of fiscal 2014 were $0.30, increased by 130.8% from $0.13 for the same quarter last year. "I am very pleased that the Company has delivered strong performance in this quarter," said Mr. Xiaojun Zhu, Chairman and Chief Executive Officer of China HGS. "During the second quarter, we sold a significant portion of commercial units located in Yang County Pearl Garden Project and successfully delivered two municipal roads constructed for the local government. We also experienced significant sales progress in our newly constructed Mingzhu Beiyuan and Oriental Garden real estate projects. These strong results demonstrate that our growth strategy is working well and our execution is effective." "As the government is cautiously implementing new policies and strategies to manage a stable economic growth in China, new catalysts will drive the growth. We have confidence that our strategy focusing on the real estate market in Tier 3 and Tier 4 cities and counties in China remains sound and effective going forward." Mr. Zhu continued. "For example, the new airport for the greater Hanzhong area is near its completion and is expected to be in operation in the second half of this year. The new airport will offer several direct flights daily from Tier 1 cities such as Beijing, Shanghai and Shenzhen, and many other regional flights, which we believe will add new catalysts to the economic growth in the greater Hanzhong area. We expect that the regional economy in the area which is our major market will get a boost with the new catalysts." concluded Mr. Xiaojun Zhu. SafeHarborStatement This press release contains forward-looking statements, which are subject to change. The forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All "forward-looking statements" relating to the business of China HGS Real Estate Inc., which can be identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties which could cause actual results to differ. These factors include but are not limited to: the uncertain market for the Company's business, macroeconomic, technological, regulatory, or other factors affecting the profitability of real estate business; and other risks related to the Company's business and risks related to operating in China. Please refer to the Company's Annual Report on Form 10-K for the fiscal year ended September 30, 2013, as well as the Company's Quarterly Reports on Form 10-Q that have been filed since the date of such annual report, for specific details on risk factors. Given these risks and uncertainties, you are cautioned not to place undue reliance on forward-looking statements. The Company's actual results could differ materially from those contained in the forward-looking statements. The Company undertakes no obligation to revise or update its forward-looking statements in order to reflect events or circumstances that may arise after the date of this release. About China HGS Real Estate, Inc. China HGS Real Estate, Inc. (NASDAQ: HGSH), founded in 1995 and headquartered in Hanzhong City, Shaanxi Province, is a leading real estate developer in the region and holds the national grade I real estate qualification. The Company focuses on the development of high-rise, sub-high-rise residential buildings and multi-building apartment complexes in China's Tier 3 and Tier 4 cities and counties with rapidly growing populations driven by increased urbanization. The Company provides affordable housing with popular and modern designs to meet the needs of multiple buyer groups. The Company's development activity spans a range of services, including land acquisition, project planning, design management, construction management, sales and marketing, and property management. For further information about China HGS, please go to www.chinahgs.com. Company contact: Randy Xiong, President of Capital Market China Phone: (86) 091-62622612 Email: firstname.lastname@example.org CHINA HGS REAL ESTATE, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) March 31 September 30 2014 2013 ASSETS Current assets: Cash $ 2,843,953 $ 5,878,101 Restricted cash 1,483,280 1,332,807 Advances to vendors - 109,134 Cost and earnings in excess of billings 5,744,960 2,178,270 Real estate property development completed 9,472,719 11,607,164 Real estate property under development - 1,580,670 Other current assets 583,328 368,377 Total current assets 20,128,240 23,054,523 Property, plant and equipment, net 930,331 977,739 Real estate property development completed, net 2,183,887 7,619,811 of current portion Security deposits for land use right 3,245,752 3,259,240 Real estate property under development, net of 199,704,185 142,916,601 current portion Accounts receivable 3,161,946 - Total Assets $ 229,354,341 $ 177,827,914 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Bank loan – current portion $ 11,360,132 $ 4,888,860 Accounts payable 25,424,259 22,527,686 Other payables 5,644,077 1,863,922 Construction deposits 370,131 357,447 Billings in excess of cost and earnings 8,745,055 5,109,758 Customer deposits 6,005,135 6,130,466 Shareholder loan 9,356,374 1,810,000 Accrued expenses 2,731,959 2,896,539 Taxes payable 9,177,823 6,612,707 Total current liabilities 78,814,945 52,197,385 Long-term bank loan, less current portion 12,983,008 11,407,340 Deferred tax liabilities 1,742,989 650,067 Customer deposits, net of current portion 19,681,160 13,410,081 Construction deposits, net of current portion 1,009,683 1,013,877 Total liabilities 114,231,785 78,678,750 Commitments and Contingencies Stockholders' equity Common stock, $0.001 par value, 100,000,000 shares authorized, 45,050,000 shares issued and outstanding March 31, 2014 and September 30, 2013 45,050 45,050 Additional paid-in capital 17,759,349 17,759,349 Statutory surplus 8,977,230 8,977,230 Retained earnings 79,763,614 63,257,918 Accumulated other comprehensive income 8,577,313 9,109,617 Total stockholders' equity 115,122,556 99,149,164 Total Liabilities and Stockholders' Equity $ 229,354,341 $ 177,827,914 CHINA HGS REAL ESTATE, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (Unaudited) Three months ended March Six months ended March 31, 31, 2014 2013 2014 2013 Real estate $ 49,907,770 $ 19,382,960 $ 64,048,333 $ 30,386,375 sales Less: Sales 3,007,183 1,148,725 3,953,871 1,859,442 tax Cost of real estate 31,392,779 10,678,011 40,538,620 14,508,255 sales Gross profit 15,507,808 7,556,224 19,555,842 14,018,678 Operating expenses Selling and distribution 253,916 297,914 368,266 459,008 expenses General and administrative 586,245 1,117,545 1,126,474 1,678,516 expenses Total operating 840,161 1,415,459 1,494,740 2,137,524 expenses Operating 14,667,647 6,140,765 18,061,102 11,881,154 income Interest 4,446 - 9,005 - income Interest (128,411) (18,100) (146,511) (36,200) (expense) Other income (expenses) - - 7 - 7,959 net Income before 14,543,682 6,122,672 17,923,596 11,852,913 income taxes Provision for 1,095,103 355,952 1,417,900 577,116 income taxes Net income $ 13,448,579 $ 5,766,720 $ 16,505,696 $ 11,275,797 Other comprehensive income Foreign currency translation (939,669) 468,723 (532,304) 677,708 adjustment Comprehensive $ 12,508,910 $ 6,235,443 $ 15,973,392 $ 11,953,505 income Basic and diluted income per common share Basic $ 0.30 $ 0.13 $ 0.37 $ 0.25 Diluted $ 0.30 $ 0.13 $ 0.37 $ 0.25 Weighted average common shares outstanding Basic 45,050,000 45,050,000 45,050,000 45,050,000 Diluted 45,126,214 45,116,695 45,126,214 45,090,074 CHINA HGS REAL ESTATE, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Six months ended March 31, 2014 2013 Cash flows from operating activities Net income $ 16,505,696 $ 11,275,797 Adjustments to reconcile net income to net cash used in operating activities: Deferred tax provision 1,103,204 - Depreciation 43,661 44,671 Stock based compensation - 5,512 Changes in assets and liabilities: Restricted cash (157,070) (127,177) Accounts receivable (3,183,853) (4,030,621) Advances to vendors 109,435 (1,475,065) Loans to outside parties - 15,917 Security deposits for land use rights - (398,329) Cost and earnings in excess of billings 3,681,777 - Real estate property development 7,542,703 7,834,524 completed Real estate property under development (56,191,546) (16,983,329) Other current and non-current assets (217,975) (56,762) Accounts payables 3,010,516 1,302,987 Other payables 3,814,113 652,305 Billings in excess of cost and earnings (3,600,479) - Customer deposits 6,269,755 401,479 Construction deposits 14,260 95,605 Accrued expenses (154,580) 184,157 Taxes payable 2,610,444 857,617 Net cash used in operating activities (18,799,939) (400,712) Cash flow from financing activities Proceeds from shareholder loan 7,598,660 - Proceeds from bank loan 8,170,602 - Net cash provided by financing activities 15,769,262 - Effect of changes of foreign exchange (3,471) 8,219 rate on cash Net decrease in cash (3,034,148) (392,493) Cash, beginning of period 5,878,101 1,104,686 Cash, end of period $ 2,843,953 $ 712,193 Supplemental disclosures of cash flow information: Interest paid $ 751,584 $ - Income taxes paid $ 244,997 $ 37,408 SOURCE China HGS Real Estate Inc. Website: http://www.chinahgs.com
China HGS Reports Second Quarter of Fiscal Year 2014 Results - Revenues Up by Approximately 157.5%
Press spacebar to pause and continue. Press esc to stop.