Ever Glory International : Glory Reports First Quarter 2018 Financial Results

Ever-Glory Reports FQuarter 2018 Financial Results

NANJING, China, May 15, 2018 /PRNewswire/ -- Ever-Glory International Group, Inc. (the 'Company' or 'Ever-Glory') (NASDAQ: EVK), a retailer of branded fashion apparel and a leading global apparel supply chain solution provider, today reported its financial results for the first quarter ended March 31, 2018.First Quarter 2018 Financial Results

Total salesfor the first quarter of 2018 were $92.8 million, an increase of 9.0% from $85.1 million in the first quarter of 2017. This increase was primarily driven by an 18.9% increase in our retail business, partially offset by a 10.8% decrease in wholesale business.

Sales for the Company's branded fashion apparel retail division increased by % to $million for the first quarter of 2018, compared with $million for the first quarter of 2017. This increase was primarily due to an increase in same-store sales. The Company had retail stores as of March 31, 2018, compared with retail stores as of March 31, 2017.

Salesfor the Company's wholesale divisioncreased by % to $million for the first quarter of 2018, compared with $million for the first quarter of 2017. This was primarily attributable to decreased sales in Mainland China, Germany, the United Kingdom, other European markets and Hong Kong, partially offset for increased sales in the United States and Japan.

Total gross profit for the first quarter of 2018 creased by% to $million, compared with $million for the first quarter of 2017. Total gross margin increased to % from % for the first quarter of 2017.

Gross profit for the retail businessincreased by % to $million for the first quarter of 2018, compared with $million for the first quarter of 2017. Gross margin was %, compared to% for the first quarter of 2017.

Gross profitfor the wholesale businessby % to $million for the first quarter of 2018, compared with $million for the first quarter of 2017. Gross margin creased to % from % for the first quarter of 2017.Selling expensesfor the first quarter of 2018 increased by % to $million, or % of total sales, compared with $million, or % of total salesfor the first quarter of 2017. The increase was attributable to the increased store decoration and marketing expenses.

General and administrative expensesfor the first quarter of 2018 creased by 5.8% to $million, or % of total sales,compared with $million, or % of total salesfor the first quarter of 2017. The increase was mainly attributable to the increased average salaries.

Income from operationsfor the first quarter of 2018 decreased by 4.2% to $million compared with $million for the first quarter of 2017.

Net income attributablefor the first quarter of 2018 million compared with million for the first quarter of 2017. Basic and diluted earnings per share were $0.06 for the first quarter of 2018 compared with basic and diluted earnings per share of $0.07 for the first quarter of 2017.

Balance Sheet

As of March 31, 2018, Ever-Glory had approximately $million of cash and cash equivalents, compared with approximately $million as of December 31, 2017. Ever-Glory had working capital of approximately $million as of March 31, 2018, and outstanding bank loans of approximately $million as of March 31, 2018.

Conference Call

The Company will hold a conference call at 8:00 a.m. Eastern Time on May 15, 2018(8:00 p.m. Beijing Time on May 15, 2018). Listeners can access the conference call by dialing [phone] or [phone] and using the access code 2785487. The conference call will also be webcast live over the Internet and can be accessed at the Company's website athttp://www.everglorygroup.com.

A replay of the conference call will be available from 11:00 a.m. Eastern Time on May 15 through 11:59 p.m. Eastern Time on May 22, by dialing [phone] or [phone] and using the access code 2785487.

About Ever-Glory International Group, Inc.

Based in Nanjing, China, Ever-Glory International Group, Inc. is a retailer of branded fashion apparel and a leading global apparel supply chain solution provider. Ever-Glory is the first Chinese apparel Company listed on the American Stock Exchange (now named as NYSE MKT) in July 2008 and then transferred to The NASDAQ Global Market on December 31, 2015. Ever-Glory offers apparel to woman in China under its own brands 'La go go', 'Velwin', 'Sea To Sky' and 'idole'. Ever-Glory is also a leading global apparel supply chain solution provider with a focus on middle-to-high end casual wear, outerwear, and sportswear brands. Ever-Glory services a number of well-known brands and retail stores by providing a complete set of supply chain management services, including: fabric development and design, sampling, sourcing, quality control, manufacturing, logistics, customs clearance and distribution.

Forward-Looking Statements

Certain statements in this release and other written or oral statements made by or on behalf of Ever-Glory International Group, Inc. (the 'Company') are 'forward looking statements' within the meaning of the federal securities laws. Statements regarding future events and developments and the Company's future performance, as well as management's expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements within the meaning of these laws. The forward looking statements are subject to a number of risks and uncertainties including, without limitation, market acceptance of the Company's products and offerings, development and expansion of the Company's wholesale and retail operations, the Company's continued access to capital, currency exchange rate fluctuation and other risks and uncertainties. The actual results the Company achieves (including, without limitation, the results stemming from the future implementation of the Company's strategies and the revenue, net income and new retail store projections set forth herein) may differ materially from those contemplated by any forward-looking statements due to such risks and uncertainties (many of which are beyond the Company's control). These statements are based on management's current expectations and speak only as of the date of such statements. Readers should carefully review the risks and uncertainties described in the Company's latest Annual Report on Form 10-K and other documents that the Company files from time to time with the U.S. Securities and Exchange Commission. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

For investor and media inquiries, please contact:

Ever-Glory International Group

Dandan Song

Tel: [phone]

E-Mail: [e-mail]

The Piacente Group, Inc.

Emilie Wu

China: [phone]

US: [phone]

E-Mail: [e-mail]

EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In thousands of U.S. Dollars, except share and per share data or otherwise stated)

AS OF MARCH 31, 2018 (UNAUDITED) AND DECEMBER 31, 2017

		2018				2017
ASSETS
CURRENT ASSETS
Cash and cash equivalents		$	65,177			$	62,876
Accounts receivable, net			55,682				81,859
Inventories			56,598				56,182
Value added tax receivable			1,976				3,757
Other receivables and prepaid expenses			4,725				5,139
Advances on inventory purchases			4,320				3,028
Amounts due from related parties			248				265
Total Current Assets			188,726				213,106
INTANGIBLE ASSETS			6,616				5,995
PROPERTY AND EQUIPMENT, NET			26,172				25,891
TOTAL ASSETS		$	221,514			$	244,992
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Bank loans		$	41,620			$	37,730
Accounts payable			58,191				73,788
Accounts payable and other payables - related parties			4,052				4,675
Other payables and accrued liabilities			11,793				16,454
Value added and other taxes payable			4,352				6,052
Income tax payable			1,005				1,712
Total Current Liabilities			121,013				140,411
NONCURRENT LIABILITIES
Deferred tax liabilities			1,714				1,883
TOTAL LIABILITIES			122,727				142,294
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Stockholders' equity:
Preferred stock ($.001 par value, authorized 5,000,000 shares, no shares issued and outstanding)			-				-
Common stock ($.001 par value, authorized 50,000,000 shares, 14,795,992 and 14,795,992 shares issued and outstanding As of March 31, 2018 and December 31, 2017, respectively)			15				15
Additional paid-in capital			3,620				3,620
Retained earnings			96,010				95,195
Statutory reserve			17,794				17,794
Accumulated other comprehensive income			6,608				2,585
Amounts due from related party			(23,928	)			(15,449	)
Total equity attributable to stockholders of the Company			100,119				103,760
Noncontrolling interest			(1,332	)			(1,062	)
Total Equity			98,787				102,698
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY		$	221,514			$	244,992

EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME(In thousands of U.S. Dollars, except share and per share data or otherwise stated)

FOR THE THREE MONTHS ENDED MARCH 31, 2018 AND 2017 (UNAUDITED)

		2018				2017
SALES		$	92,785			$	85,120
COST OF SALES			61,440				56,611
GROSS PROFIT			31,345				28,509
OPERATING EXPENSES
Selling expenses			22,225				19,745
General and administrative expenses			7,674				7,255
Total operating expenses			29,899				27,000
INCOME FROM OPERATIONS			1,446				1,509
OTHER INCOME (EXPENSE)
Interest income			326				257
Interest expense			(564	)			(327	)
Other income			136				577
Total other expenses			(102	)			507
INCOME BEFORE INCOME TAX EXPENSE			1,344				2,016
INCOME TAX EXPENSE			(757	)			(1,217	)
NET INCOME			587				799
Net loss attributable to the non-controlling interest			228				175
NET INCOME ATTRIBUTABLE TO THE COMPANY		$	815			$	974
NET INCOME		$	587			$	799
Foreign currency translation income			4,023				459
COMPREHENSIVE INCOME		$	4,610			$	1,258
Comprehensive loss attributable to the noncontrolling interest			270				180
COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY		$	4,880			$	1,438
EARNINGS PER SHARE:
Basic and diluted		$	0.06			$	0.07
Weighted average number of shares outstanding Basic and diluted			14,795,992				14,789,626

EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS(In thousands of U.S. Dollars, except share and per share data or otherwise stated)

FOR THE THREE MONTHS ENDED MARCH 31, 2018 AND 2017 (UNAUDITED)

		2018				2017
CASH FLOWS FROM OPERATING ACTIVITIES
Net income		$	587			$	799
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization			2,537				2,241
Loss from sale of property and equipment			4				5
Provision for obsolete inventories			1,626				4,105
Deferred income tax			(234	)			(1,180	)
Stock-based compensation			-				10
Changes in operating assets and liabilities
Accounts receivable			28,466				23,487
Inventories			(129	)			5,541
Value added tax receivable			1,895				1,236
Other receivables and prepaid expenses			832				(543	)
Advances on inventory purchases			(1,175	)			(1,730	)
Amounts due from related parties			(165	)			(495	)
Accounts payable			(17,944	)			(11,762	)
Accounts payable and other payables- related parties			(653	)			(1,527	)
Other payables and accrued liabilities			(5,182	)			(1,794	)
Value added and other taxes payable			(1,988	)			(2,713	)
Income tax payable			(670	)			(755	)
Net cash provided by operating activities			7,807				14,925
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property and equipment			(2,552	)			(1,209	)
Net cash used in investing activities			(2,552	)			(1,209	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from bank loans			17,346				15,671
Repayment of bank loans			(14,780	)			(12,913	)
Advances to related party			(7,692	)			(1,742	)
Net cash provided by (used in) financing activities			(5,126	)			1,016
EFFECT OF EXCHANGE RATE CHANGES ON CASH			2,172				80
NET INCREASE IN CASH AND CASH EQUIVALENTS			2,301				14,812
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD			62,876				45,288
CASH AND CASH EQUIVALENTS AT END OF PERIOD		$	65,177			$	60,100
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest		$	564			$	327
Income taxes		$	1,938			$	1,853