Huadi International Group Co., Ltd. (“HUDI” or the “Company”)
(NASDAQ: HUDI), a leading developer and manufacturer of industrial
stainless steel seamless pipes and tubes products in China,
today announced its audited financial results for the fiscal year
ended September 30, 2021.
Financial Highlights for the Fiscal Year
2021
|
For the fiscal year ended September 30, |
($ millions, except per share data) |
2021 |
|
|
2020 |
|
|
% Change |
Revenue |
$70.25 |
|
|
$59.14 |
|
|
18.79% |
Gross profit |
$11.32 |
|
|
$10.66 |
|
|
6.15% |
Gross margin |
16.11% |
|
|
18.03% |
|
|
(1.92) percentage points |
Operating income |
$2.58 |
|
|
$4.61 |
|
|
(44.02)% |
Operating income margin |
3.67% |
|
7.79% |
|
(4.12) percentage points |
Net income attributable to Huadi International |
$2.53 |
|
|
$3.32 |
|
|
(23.8)% |
Diluted earnings per share |
$0.21 |
|
|
$0.34 |
|
|
(38.24)% |
|
|
|
|
|
|
|
|
-
Revenue increased by 18.79% to $70.25 million primarily due
to: 1) the increased market demand of construction materials and
shortage of supply on the current market; 2) the growth in the
number of domestic and international clients and sales.
-
Gross profit increased by 6.15% to $11.32 million. The increase of
gross profit was consistent with the increase of revenues for
fiscal 2021 as compared to fiscal 2020. Gross margin was 16.11%,
compared to 18.03% for the prior fiscal year. The decrease of gross
profit margin was mainly due to increased raw material cost caused
by the supply shortage of steel materials and increased
international fright expenses.
-
Operating income was $2.58 million, compared to $4.61
million for the prior fiscal year. Operating margin was 3.67%,
compared to 7.79% for the prior fiscal year.
- Net income
attributable to Huadi International was $2.53 million, or net
earnings of $0.21 per share. This compared to net income
attributable to Huadi International of $3.32 million, or $0.34 per
share, for the prior fiscal year.
“We are pleased with our business performance
for the fiscal year 2021, generated $70.25 million revenue and
$11.32 million gross profit for the fiscal year 2021, increased
18.79% and 6.15%, respectively, compared to the last fiscal year,
our domestic and international sales increased by 12.40% and 44.2%,
respectively. The significant growth shows our great efforts to
sustainably develop our business operation, and the market
recognizing the quality of our products and the brand awareness of
Huadi. Looking ahead to the fiscal year 2022, we will continue to
execute our growth strategies and improve our brand influence,
while the demand for the construction materials continues to grow,
our strong business operation performance positions us well to
increase market share in this industry that will continue to
consolidate, and create more benefits to all of our shareholders in
the future,” commented Mr. Di Wang, Chairman of Huadi
International Group Co., Ltd.
Financial Results for the Fiscal year
2021
Revenue
The following table presents revenue by
geographic areas for the years ended September 30, 2021 and 2020
respectively.
|
|
September 30, 2021 |
|
|
September 30, 2020 |
|
Top 5 International Markets: |
|
Sales Amount ($
millions) |
|
|
As %of Sales |
|
|
Sales Amount ($
millions) |
|
|
As %of Sales |
|
China |
|
$ |
53.13 |
|
|
|
81.22 |
% |
|
|
$ |
47.27 |
|
|
|
79.93 |
% |
US |
|
|
5,.74 |
|
|
|
8.78 |
% |
|
|
|
3.0 |
|
|
|
5.07 |
% |
India |
|
|
4.19 |
|
|
|
6.41 |
% |
|
|
|
5.08 |
|
|
|
8.59 |
% |
Australia |
|
|
0.55 |
|
|
|
0.84 |
% |
|
|
|
1.33 |
|
|
|
2.24 |
% |
Switzerland |
|
|
0.51 |
|
|
|
0.79 |
% |
|
|
|
- |
|
|
|
- |
% |
Other foreign countries |
|
|
6.12 |
|
|
|
1.96 |
% |
|
|
|
2.46 |
|
|
|
4.17 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the year ended September 30, 2021, revenues
increased by approximately $11.11 million or 18.79%, to
approximately $70.25 million from approximately $59.14 million for
the year ended September 30, 2020. The increase in revenues
was primarily driven by the following factors:
1) |
Due to increased market demand of construction materials and
shortage of supply on the current market, particularly the piping
systems in the real estate sector, we observed an increase of
weighted average selling price (“ASP”) during the fiscal year
2021. |
2) |
As a result of global shortage of construction materials, our
domestic sales increased over 12.40% compared to the last fiscal
year. Our international sales revenue during fiscal year 2021
amounted to $17.12 million, an increase of $5.25 million, or 44.2%,
compared to last fiscal year |
|
|
Gross Profit
Our gross profit increased by approximately
$0.66 million, or 6.15%, to approximately $11.32 million for the
year ended September 30, 2021 from approximately $10.66 million for
the year ended September 30, 2020. The increase of gross profit was
consistent with the increase of revenues for fiscal 2021 as
compared to fiscal 2020. Gross profit margin was 16.11% for the
year ended September 30, 2021, as compared to 18.03% for the year
ended September 30, 2020. The decrease of gross profit margin was
mainly due to increased raw material cost caused by the supply
shortage of steel materials and increased international fright
expenses.
Operating Expenses
Selling, general and administrative expenses
increased by approximately $2.75 million, or 69.72% to
approximately $6.68 million for the year ended September 30, 2021
as compared to approximately $3.94 million for the year ended
September 30, 2020. The increase of SGA expenses was mainly due to
increased consulting and compliance expenses in relation to our
initial public offering and increased freight expenses incurred
during fiscal year 2021.
Research and development expenses decreased by
approximately $0.06 million, or 2.98% to approximately $2.06
million for the year ended September 30, 2021 as compared to
approximately $2.12 million for the year ended September 30, 2020.
Management is committed to expanding our research and development
activities.
Total operating expenses increased by $2.68
million, or 44.28%, to $8.74 million for the fiscal year 2021 from
$6.06 million for the prior fiscal year. As a percentage of sales,
total operating expenses was 12.4% for the fiscal year 2020,
compared to 10.2% for the prior fiscal year.
Total Operating Income
Operating income was $2.58 million for the
fiscal year ended September 30, 2021, compared to income from
operations of $4.61 million for the prior fiscal year.
Operating margin was 3.67%, compared to operating profit margin of
7.79% for the prior fiscal year.
Interest expenses
Our interest expense (net) decreased by
approximately $0.10 million, or 4.81% to approximately $2.06
million for the year ended September 30, 2021, from approximately
$2.16 million for the year ended September 30, 2020. The decrease
of interest expense was mainly due to decreased bank loan the
Company borrowed from the banks.
Other Income
We had net other income of approximately $1.95
million, which mainly attributable to dividend income received from
invested company and government grant received during fiscal year
2021, comparing to net other income of approximately $1.13 million,
which mainly attributable to dividend income received from invested
company and government grant received during fiscal year 2020.
Net Income and earnings per share
As a result of the factors described above, net
income was $2.56 million for the fiscal year 2021, compared to net
income of $3.36 million for the prior fiscal year. Net income
margin was 3.6% for the fiscal year 2021, compared to net profit
margin of 5.8% for the prior fiscal year.
After deducting for non-controlling interests,
net income attributable to Huadi International was $2.53 million,
or net earnings of $0.21 per share, for the fiscal year 2021. This
compared to net income attributable to Huadi International of $3.32
million, or $0.34 per share, for the prior fiscal year.
Financial Condition
As of September 30, 2021, cash and cash
equivalents totaled $15.35 million, compared to $0.80 million as of
September 30, 2020. Short-term bank borrowings were $33.46 million
as of September 30, 2021, compared to $31.22 million as of
September 30, 2020.
Accounts receivable net of allowance was
$25.28 million as of September 30, 2021, compared to $15.53
million as of September 30, 2020. Inventories were $22.72 million
as of September 30, 2021, compared to $20.84 million as of
September 30, 2020. Accounts payable was $1.71 million as of
September 30, 2021, compared to $1.86 million as of September 30,
2020.
Total current assets and current liabilities
were $77.08 million and $48.77 million, respectively,
leading to a current ratio of 1.58 as of September 30, 2021. This
compared to total current assets and current liabilities were
$47.35 million and $43.33 million, respectively, and current ratio
of 1.09 as of September 30, 2020.
Net cash used in operating activities was $5.65
million for the fiscal year 2021, compared to net cash provided by
operating activities was $3.20 million for the prior fiscal year.
Net cash used in investing activities was $0.90 million for the
fiscal year 2021, compared to net cash provided by investing
activities of $0.06 million for the prior fiscal year. Net cash
provided by financing activities was $21.28 million for the fiscal
year 2021, compared to net cash used in financing activities of
$4.69 million for the prior fiscal year.
Recent Developments
On November 10, 2021, the Company entered
into a strategic cooperation framework agreement on October 28,
2021 with Zhejiang Lanneng Gas Equipment Limited to jointly develop
and produce high-pressure hydrogen storage tank stainless steel
pipe.
On November 1, 2021, the Company was
awarded stainless steel seamless pipe order contracts
worth $3.26 million in total.
About Huadi International Group
Co., Ltd.
Huadi International Group Co., Ltd. is a
leading manufacturer of industrial stainless steel seamless pipes
and tubes products with extensive distribution facilities and
network for over twenty provinces in China and across
international steel pipes industry. It offers a broad range of
products exported to twenty countries and regions such
as United
States, Mexico, Thailand, Australia, Argentina, Taiwan, India, the
Philippines, UAE and Canada. Its products are widely
used in the oil & gas transmission, chemistry engineering, food
processing, medical devices, aeronautics and astronautics, boiler,
irrigation works construction, electricity, automobile, naval
architecture, paper mill and mechanical industries. For more
information about the Company, please
visit: http://www.huadi.cc.
Forward-Looking Statement
This press release contains forward-looking
statements as defined by the Private Securities Litigation Reform
Act of 1995. Forward-looking statements include statements
concerning plans, objectives, goals, strategies, future events or
performance, and underlying assumptions and other statements that
are other than statements of historical facts. When the Company
uses words such as “may, “will, “intend,” “should,” “believe,”
“expect,” “anticipate,” “project,” “estimate” or similar
expressions that do not relate solely to historical matters, it is
making forward-looking statements. Forward-looking statements are
not guarantees of future performance and involve risks and
uncertainties that may cause the actual results to differ
materially from the Company’s expectations discussed in the
forward-looking statements. These statements are subject to
uncertainties and risks including, but not limited to, the
following: the Company’s goals and strategies; the Company’s future
business development; financial condition and results of
operations; product and service demand and acceptance; reputation
and brand; the impact of competition and pricing; changes in
technology; government regulations; fluctuations in general
economic and business conditions in China and assumptions
underlying or related to any of the foregoing and other risks
contained in reports filed by the Company with the SEC. For
these reasons, among others, investors are cautioned not to place
undue reliance upon any forward-looking statements in this press
release. Additional factors are discussed in the Company’s filings
with the SEC, which are available for review
at www.sec.gov. The Company undertakes no obligation to
publicly revise these forward‐looking statements to reflect events
or circumstances that arise after the date hereof.
For more information, please contact:
The Company:IR
DepartmentEmail: IR@huadigroup.com
Investor Relations:Dong Cao, CFAEverGreen
Consulting Inc.Email: IR@changqingconsulting.comPhone: +86
13502048965
HUADI INTERNATIONAL GROUP CO.,
LTD.
CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2021 AND
2020
(IN U.S. DOLLARS, EXCEPT SHARE
DATA)
|
|
2021 |
|
|
2020 |
|
Assets |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
15,350,197 |
|
|
$ |
796,794 |
|
Restricted cash |
|
|
1,304,518 |
|
|
|
908,410 |
|
Accounts receivable, net of allowance for doubtful accounts of
$3,066,937 and $2,910,554, respectively |
|
|
21,297,261 |
|
|
|
13,618,697 |
|
Accounts receivable – related parties |
|
|
3,981,697 |
|
|
|
1,914,380 |
|
Notes receivable |
|
|
2,593,018 |
|
|
|
555,612 |
|
Inventories |
|
|
22,721,265 |
|
|
|
20,837,594 |
|
Advances to suppliers |
|
|
3,806,420 |
|
|
|
998,123 |
|
Advances to suppliers – related parties |
|
|
5,550,504 |
|
|
|
5,342,512 |
|
Other receivables |
|
|
475,793 |
|
|
|
2,375,031 |
|
Total current assets |
|
|
77,080,673 |
|
|
|
47,347,153 |
|
Property, plant and equipment, net |
|
|
7,208,705 |
|
|
|
6,687,642 |
|
Land use rights, net |
|
|
1,234,636 |
|
|
|
1,202,687 |
|
Long-term investments |
|
|
14,171,928 |
|
|
|
13,449,305 |
|
Deferred tax assets |
|
|
549,921 |
|
|
|
436,583 |
|
TOTAL
ASSETS |
|
$ |
100,245,863 |
|
|
$ |
69,123,370 |
|
LIABILITIES AND SHAREHOLDERS’
EQUITY |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
$ |
1,713,716 |
|
|
$ |
1,855,047 |
|
Accrued expenses and other current liabilities |
|
|
2,048,979 |
|
|
|
1,587,826 |
|
Notes payable |
|
|
2,312,556 |
|
|
|
1,517,026 |
|
Advances from customers |
|
|
4,667,084 |
|
|
|
1,515,452 |
|
Due to related parties |
|
|
514,913 |
|
|
|
1,407,711 |
|
Short-term borrowings |
|
|
33,459,043 |
|
|
|
31,221,280 |
|
Tax payable |
|
|
4,051,158 |
|
|
|
4,230,328 |
|
TOTAL
LIABILITIES |
|
|
48,767,449 |
|
|
|
43,334,670 |
|
|
|
|
|
|
|
|
|
|
COMMITMENTS AND
CONTINGENCIES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders’ equity: |
|
|
|
|
|
|
|
|
Common stock, $0.0002 par value, 250,000,000 shares authorized,
13,127,000 and 10,000,000 shares issued and outstanding,
respectively |
|
|
2,625 |
|
|
|
2,000 |
|
Additional paid-in capital |
|
|
44,211,336 |
|
|
|
22,531,620 |
|
Statutory surplus reserves |
|
|
255,705 |
|
|
|
- |
|
Retained earnings (Accumulated deficit) |
|
|
2,116,581 |
|
|
|
(159,189 |
) |
Accumulated other comprehensive income |
|
|
4,627,661 |
|
|
|
3,189,856 |
|
Total equity attributable to
Huadi International Group Co., Ltd. |
|
|
51,213,908 |
|
|
|
25,564,287 |
|
Equity attributable to
non-controlling interests |
|
|
264,506 |
|
|
|
224,413 |
|
Total shareholders’
equity |
|
|
51,478,414 |
|
|
|
25,788,700 |
|
TOTAL LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
$ |
100,245,863 |
|
|
$ |
69,123,370 |
|
|
|
|
|
|
|
|
|
|
HUADI INTERNATIONAL GROUP CO.,
LTD.
CONSOLIDATED STATEMENTS OF INCOME AND
COMPREHENSIVE INCOME
FOR THE YEARS ENDED SEPTEMBER 30, 2021
AND 2020(IN U.S. DOLLARS, EXCEPT SHARE
DATA)
|
|
2021 |
|
|
2020 |
|
Sales |
|
$ |
67,006,655 |
|
|
$ |
57,767,081 |
|
Production service
revenue |
|
|
3,239,956 |
|
|
|
1,370,197 |
|
Cost of sales |
|
|
(58,926,675 |
) |
|
|
(48,473,061 |
) |
Gross
profit |
|
|
11,319,936 |
|
|
|
10,664,217 |
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
|
6,684,410 |
|
|
|
3,938,511 |
|
Research and development |
|
|
2,057,547 |
|
|
|
2,120,649 |
|
Total operating
expenses |
|
|
8,741,957 |
|
|
|
6,059,160 |
|
|
|
|
|
|
|
|
|
|
Operating
income |
|
|
2,577,979 |
|
|
|
4,605,057 |
|
|
|
|
|
|
|
|
|
|
Other income (expenses): |
|
|
|
|
|
|
|
|
Interest expenses, net |
|
|
(2,058,461 |
) |
|
|
(2,162,589 |
) |
Other income, net |
|
|
1,948,527 |
|
|
|
1,132,780 |
|
Total other expenses,
net |
|
|
(109,934 |
) |
|
|
(1,029,809 |
) |
|
|
|
|
|
|
|
|
|
Income before income
taxes |
|
|
2,468,045 |
|
|
|
3,575,248 |
|
|
|
|
|
|
|
|
|
|
Income tax provision |
|
|
89,000 |
|
|
|
(218,949 |
) |
|
|
|
|
|
|
|
|
|
Net
income |
|
|
2,557,045 |
|
|
|
3,356,299 |
|
Net income attributable to
non-controlling interests |
|
|
25,570 |
|
|
|
33,563 |
|
|
|
|
|
|
|
|
|
|
Net income attributable to
Huadi International Group Co., Ltd. |
|
$ |
2,531,475 |
|
|
$ |
3,322,736 |
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
2,557,045 |
|
|
$ |
3,356,299 |
|
|
|
|
|
|
|
|
|
|
Other comprehensive income
(loss): |
|
|
|
|
|
|
|
|
Foreign currency translation adjustment |
|
|
1,452,328 |
|
|
|
1,225,301 |
|
|
|
|
|
|
|
|
|
|
Total comprehensive
income |
|
|
4,009,373 |
|
|
|
4,581,600 |
|
Comprehensive income
attributable to non-controlling interests |
|
|
40,093 |
|
|
|
45,816 |
|
|
|
|
|
|
|
|
|
|
Comprehensive income
attributable to Huadi International Group Co., Ltd. |
|
$ |
3,969,280 |
|
|
$ |
4,535,784 |
|
|
|
|
|
|
|
|
|
|
Basic and diluted earnings per
share |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.21 |
|
|
$ |
0.34 |
|
Diluted |
|
$ |
0.21 |
|
|
$ |
0.34 |
|
Weighted average numbers of
common shares outstanding |
|
|
|
|
|
|
|
|
Basic |
|
|
12,116,079 |
|
|
|
10,000,000 |
|
Diluted |
|
|
12,116,079 |
|
|
|
10,000,000 |
|
|
|
|
|
|
|
|
|
|
HUADI INTERNATIONAL GROUP CO.,
LTD.
CONSOLIDATED STATEMENTS OF CASH
FLOWS
FOR THE YEARS ENDED SEPTEMBER 30, 2021
AND 2020
(IN U.S. DOLLARS)
|
|
2021 |
|
|
2020 |
|
Cash Flows from Operating
Activities: |
|
|
|
|
|
|
Net income |
|
$ |
2,557,045 |
|
|
$ |
3,356,299 |
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
Depreciation |
|
|
735,333 |
|
|
|
723,586 |
|
Amortization |
|
|
32,349 |
|
|
|
30,048 |
|
Bad debt expense reverse |
|
|
(153,676 |
) |
|
|
- |
|
Deferred tax benefits (expenses) |
|
|
(89,000 |
) |
|
|
- |
|
Loss (gain) on disposal of fixed assets |
|
|
1,767 |
|
|
|
(654,138 |
) |
Changes in operating assets
and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(8,823,928 |
) |
|
|
(260,202 |
) |
Notes receivable |
|
|
(1,987,871 |
) |
|
|
(10,332 |
) |
Inventories |
|
|
(756,588 |
) |
|
|
(1,987,737 |
) |
Advances to suppliers |
|
|
(2,727,661 |
) |
|
|
366,087 |
|
Advances to suppliers – related party |
|
|
78,283 |
|
|
|
180,333 |
|
Other receivables |
|
|
2,006,975 |
|
|
|
3,303,687 |
|
Accounts payable |
|
|
(238,638 |
) |
|
|
650,988 |
|
Accrued expenses and other current liabilities |
|
|
372,155 |
|
|
|
(387,358 |
) |
Notes payable |
|
|
707,021 |
|
|
|
(2,301,375 |
) |
Advances from customers |
|
|
3,040,106 |
|
|
|
222,805 |
|
Tax payable |
|
|
(402,478 |
) |
|
|
(28,401 |
) |
Net cash provided by operating activities |
|
|
(5,648,806 |
) |
|
|
3,204,290 |
|
|
|
|
|
|
|
|
|
|
Cash Flows from Investing
Activities: |
|
|
|
|
|
|
|
|
Purchases of property, plant and equipment |
|
|
(917,539 |
) |
|
|
(664,996 |
) |
Proceeds from disposition of property, plant and equipment |
|
|
20,285 |
|
|
|
724,782 |
|
Net cash provided by (used in)
investing activities |
|
|
(897,254 |
) |
|
|
59,786 |
|
|
|
|
|
|
|
|
|
|
Cash Flows from Financing
Activities: |
|
|
|
|
|
|
|
|
Proceeds from short-term borrowings |
|
|
35,820,322 |
|
|
|
38,620,077 |
|
Repayments on short-term borrowings |
|
|
(35,265,552 |
) |
|
|
(40,488,791 |
) |
Proceeds from stock offering, net of offering costs |
|
|
21,680,341 |
|
|
|
- |
|
Advances from related parties |
|
|
6,223,875 |
|
|
|
3,068,965 |
|
Repayments to related parties |
|
|
(7,182,813 |
) |
|
|
(5,889,557 |
) |
Net cash provided by (used in)
financing activities |
|
|
21,276,173 |
|
|
|
(4,689,306 |
) |
|
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash and cash equivalents and restricted cash |
|
|
219,398 |
|
|
|
113,762 |
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in
cash and cash equivalents and restricted cash |
|
|
14,949,511 |
|
|
|
(1,311,468 |
) |
Cash and cash equivalents and
restricted cash at the beginning of year |
|
|
1,705,204 |
|
|
|
3,016,672 |
|
Cash and cash equivalents and
restricted cash at the end of year |
|
$ |
16,654,715 |
|
|
$ |
1,705,204 |
|
|
|
|
|
|
|
|
|
|
Supplemental disclosures of
cash flows information: |
|
|
|
|
|
|
|
|
Cash paid for income taxes |
|
$ |
480,495 |
|
|
$ |
135,262 |
|
Cash paid for interest |
|
$ |
1,550,082 |
|
|
$ |
1,951,622 |
|
Huadi (NASDAQ:HUDI)
Gráfica de Acción Histórica
De Ago 2024 a Sep 2024
Huadi (NASDAQ:HUDI)
Gráfica de Acción Histórica
De Sep 2023 a Sep 2024