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Freitag, 11.08.2017 15:10 von PR Newswire | Aufrufe: 66

Kingold Jewelry Reports Financial Results For The Second Quarter And Six Months Ended June 30, 2017

Eine Tageszeitung (Symbolbild). pixabay.com

PR Newswire

WUHAN, China, Aug. 11, 2017

- Company to Hold Conference Call with Accompanying Slide Presentation at 5:30 p.m. E.T. on August 11, 2017

WUHAN, China, Aug. 11, 2017 /PRNewswire/ -- Kingold Jewelry, Inc. ("Kingold" or the "Company") (NASDAQ: KGJI), one of China's leading manufacturers and designers of high quality 24-karat gold jewelry, ornaments and investment-oriented products, today announced its financial results for the second quarter and six months ended June 30, 2017.

2017 Second Quarter Financial Highlights (all results compared to prior year period)

Net sales were $475.9 million, an increase of 22% from $390.3 million
Proceeded a total of 26.0 metric tons of 24-karat gold products, increased 28.1% from 20.3 metric tons
Net income was $8.0 million, or $0.12 per diluted share, compared to net income was $19.9 million, or $0.30 per diluted share

Outlook for 2017

Company reiterates guidance of between 70 metric tons and 80 metric tons of 24-karat gold products in 2017

Management Commentary

Mr. Zhihong Jia, Chairman and CEO of the Company, commented, "We were pleased to continue to deliver strong operating results in the second quarter of 2017, as we fully leveraged the higher gold price along with the strong growing demand and further expanded our production capacity. Meanwhile, we continue to watch market dynamics and gold price trends to be able to make timely adjustment of our business strategy. Based on our team's extensive experience in the gold industry, we will further explore upstream-downstream industries to establish an all-round strategic plan for Kingold's overall development."

2017 SECOND QUARTER OPERATIONAL REVIEW

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Kurse

Kingold Jewelry

0,00%

Metric Tons of Gold Processed
	Three Months Ended:
	June 30, 2017		June 30, 2016
	Volume	Volume	Volume	Volume
Branded*	12	46.2%	10.5	51.7%
Customized**	14	53.8%	9.8	48.3%
Total	26	100.0%	20.3	100%
	Six Months Ended:
	June 30, 2017		June 30, 2016
	Volume	% of Total	Volume	% of Total
Branded*	20.1	47.7%	18.7	53.1%
Customized**	22	52.3%	16.5	46.9%
Total	42.1	100%	35.2	100%

*	Branded Production:	The Company acquires gold from the Shanghai Gold Exchange to produce branded products.
**	Customized Production:	Clients who purchase customized products supply gold to the Company for processing.

For the three months ended June 30, 2017, the Company sold a total of 26 metric tons of gold, of which branded production was 12 metric tons, representing 46.2% of total gold sold, and customized production was 14 metric tons, representing 53.8% of total gold sold in the second quarter of 2017. In the second quarter of 2016, the Company sold a total of 20.3 metric tons, of which branded production was 10.5 metric tons, or 51.7% of the total gold sold, and customized production was 9.8 metric tons, or 48.3% of total gold sold.

CONSOLIDATED FINANCIAL AND OPERATING REVIEW

Net Sales

Net sales for the three months ended June 30, 2017 was $475.9 million, representing an increase of $85.6 million, or 22%, from $390.3 million for the same period in 2016. The increase in net sales was primarily driven by the higher sales volume and the higher average selling price for branded production which increased from RMB 238.42 per gram in the three months ended June 30, 2016 to RMB 264 per gram in three months ended June 30, 2017.

For the six months ended June 30, 2017, the Company's net sales were $768.1 million, increased 14% from $672.4 million in the first half of 2016. The increase in net sales was mainly due to the higher sales volume and the higher average selling price for branded production which increased from RMB 231.34 per gram in the six months ended June 30, 2016 to RMB 256.66 per gram in six months ended June 30, 2017.

Gross Profit

Gross profit for the three months ended June 30, 2017 was $47.8 million, compared to $46.1 million for the same period in 2016.

For the six months ended June 30, 2017, the Company's gross profit was $64.9 million decreased from $74.6 million in the first half of 2016.

Gross Margin

The Company's gross margin was 10% for the three months ended June 30, 2017, compared to 11.8% in the prior year period. The decrease in gross margin was primarily because the increase in unit cost of branded production sales exceeded the increase of average selling price during the three months ended June 30, 2017.

For the six months ended June 30, 2017, the Company's gross margin was 8.4%, compared to 11.1% in the first half of 2016. The decrease in gross margin was primarily due to the increase in unit cost of our branded production sales exceeded the increase of average selling price of our branded production during the six months ended June 30, 2017.

Net Income ((Loss)

Net income for the three months ended June 30, 2017 was $8.0 million, or $0.12 per diluted share based on 66.4 million weighted average diluted shares outstanding, compared to net income of $19.9 million in the prior year period, or $0.30 per diluted share based on 66.3 million weighted average diluted shares outstanding in the prior-year period. The decrease in net income was primarily due to significant increase in interest expenses from $16.9 million in the three months ended June 30,2016 to $39 million in the three months ended June 30, 2017.

For the six months ended June 30, 2017, the Company's net loss was $13.3 million, or $(0.20) per basic and diluted share, compared to net income of $35.1 million, or $0.53 per basic and diluted share, in the same period of 2016. The decrease in net income was primarily due to significant increase in interest expenses from $21.5 million in the six months ended June 30,2016 to $75.3 million in the six months ended June 30, 2017.

Balance Sheet Highlights (USD in Millions)
	6/30/2017	*12/31/2016*	Percentage Change
Cash and Cash Equivalents	$9.2	$21.3	(56.8) %
Inventories	$309.6	$119.4	159 %
Working Capital	$861.0	$460.0	87.2 %
Stockholders' Equity	$326.5	$282.5	15.6 %

Net cash used in operating activities was $257 million for the six months ended June 30, 2017, compared with net cash provided by operating activities of $185.5 million for the same period in 2016. The increase of net cash used in operating was mainly due to the increase in inventories of $204 million for the increased production to meet the sales demand.

OUTLOOK FOR 2017

Based on the Company's existing resources and capacity along with strong demand for 24-karat gold products in China, and its possession of 42.1 metric tons of 24-karat gold products in the first half of 2017, the Company reiterates its expectation that gold processed will be between 70 metric tons and 80 metric tons during 2017.

Conference Call Details

Kingold also announced that it will discuss these financial results in a conference call on August 11, 2017 at 5:30 p.m. E.T.

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