Q2 2020 IT Tech Packaging Inc Earnings Call
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Gentlemen, and welcome to participate in detect Packagings second quarter 2020 earnings conference call. At this time I would like to inform you that this conference is being recorded it at all like you said that are in listen only mode, joining us a day or Mrs. Shenya view, I detect packagings, chairman and Chief Executive Officer.
Listing house, the company's Chief Financial Officer.
Excellent both Mr., the you and Ms. Hao will be delivered in English by interpreters.
Hi Tech packaging and Ltd second quarter 20 to 20 financial results like your press release yesterday, which can be found that the company's website at www Dot I T packaging dot Seattle.
First Mr that you will brief you on the company's key operational highlights.
The second quarter 20 to 20, and then Ms. Hao.
The beauty Companys financial results.
Let me start I would like to draw your attention I was safe Harbor statement.
Management's prepared remarks contain forward looking statements within the meeting August Safe Harbor provisions.
Private Securities Litigation Reform Act of 99 to five [noise].
All statements about it and statements of historical facts and it's an L. Smith, our forward looking statements, including but not limited to anticipated revenues from the Corrugating medium paper tissue paper offset printing paper and face mask business segments the actions it initiatives.
Current and potential competitors, the companys ability to introduce new products.
The company's ability to if that met capacity expansion.
Market acceptance of new products.
<unk> economic as best as conditions, the ability to attract or retain qualified senior management personnel and research and development staff and other risks detailed in the company's fightings with the Securities and Exchange Commission.
These forward looking statements involve known and unknown risks and uncertainties and are based on current expectations assumptions estimates and projections about the company and the industry.
The company undertakes no obligation to update forward looking statements to reflect subsequent events or circumstances or to changes in its expectation, except as maybe a us maybe required by law.
Although the company believes the expectations expressed in these forward looking statements or.
Reasonable CAD assure you that this expectation will turn out to be correct and investors are cautioned that actual results may differ materially from the anticipated results.
There's a presentations document Patriots management's prepared remarks, and it is now available for download from the company's website that chip will you W. dot IC packaging Dot C N.
Please note that they'll be discussion on non-GAAP financial measure or EBITDA or earnings before interest taxes depreciation and amortization.
Please refer to our press release way complete reconciliation of EBITDA to net income.
As it came in lighter or numbers in our presentation, our coded and U.S., others and all comparisons to the for the year over year comparisons and is that otherwise stated.
I'll now like to tied to call little bit to me. So do you. His comments will be that anybody in English by it'd be a they had issues from evergreen investor Relations with issue. Please go ahead.
Thank you operator, and good morning, everyone.
Well generally our second quarter 2020 earnings conference call.
Despite all the fields and operations were impacted by the calls with Nike and by make during the first quarter, we need improvement second quarter, that's almost people whose ducks.
Recovered at new face masks.
Launched equal generated revenue of 8.9 million Weve gross margin of 59.
<unk> 0.5 person in the second quarter.
40 shoe people continued a 100 group in revenue and I hate to buy historical high yields volume off 2800, and if you go town.
Due to the pandemic impact to downstream industry.
We experienced a 13% to 21 person to be Creek E. X.P. over all people products categories. However.
Except to go off that's printing paper, we do not much steel volume fluctuations from our people products during the second quarter, so would be the underlying demand for our products remains strong and we expect the overall performance will continue to be improved.
He asked piece for all people products become liberalized Wednesday and to a pandemic economy recovery continues through the whole industry GM.
Now I real terms of call over two hours has Oh Gee, how who will review on the common all the second quarter financial results. Her comments will be delivered in English find my colleagues journeys won't Jenny. Please go ahead.
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Michelle Your line is open. Please go ahead.
Right.
[laughter] everywhere bolting on coal [laughter] on behalf of management team Alright, alright, Okay financial results those kind of call. It appears on the train outdoor <unk> action like Crazy to work virus.
Our main greater which garnered I'm, referring to reference certain non recurring cisternal for our Productionized their club writing on slide number 18.
<unk> financial performance for the second Walker, Please turn to 20 grade of parent interest I can understand that.
For the park or if you're going to 20 telco revenues decreased.
21.6 distributor to 26 going for a minute.
There is a decrease in I would start in prices for all paper pocket can Brian to waste a significant increase in south, Florida offset printing paper.
Well I should also partially offset by increased aim joke about an allocation paper.
Guaranteed like eight.
For the second quarter of a pure gotten a 26 m. piece documents, including boats rather than pay in the light weight CMP generating the revenue over 21.9 manner.
Is there anything it is representative of the total revenue.
So he pouring for many other revenue was from our Rep regular doesn't pay products and the full corner bond there was going right away and he.
And they certainly undergoing <unk> slightly decreased by one born in the Senate to 59000.
500.
90 pounds.
Wage 46000, and I can go to end the 79 pounds.
Yes.
Or recollect them to enter throughout calendar and 600 and everything down to one right away experiment.
Richard selling price well air to pay for regular started they decreased by 15% tier 317 per account.
And I asked the pool I could wait guaranteed decreased by 15.4% to 357 down there and just like nine for second quarter. Two during the training. They all had occurring paper generated revenue of 1.3 minute decreased by 5 million Oh.
99.8% from that period last year.
They offset printing paper volume decreased by 74.5% it too.
She worked out in a way handled and eight break out there people also to bring integrity created by grain important parts into Q4 hundred and 78 account.
Turning to slide 10.
Tissue paper congrats.
Generated revenue of 2.4 million in increased by one important sumit, there, Oh 100 or under 2%.
Richard resulting from go Oh.
2884 accounts tissue.
So I found out with 100, and they said everything to increase and their feet of 800, and it's why swipe and town.
<unk> decreased.
So 10%.
Turning to slide 11 way so they kind of your fixed out in the 280000 pieces fit mark and the generated revenue of who deserve 0.8 minutes drugs Steri safe.
Trademark for that in the quarter She's done 20.
Right and I love to summarize a the changes in our revenue mix.
Seven o'clock over to you're going to train total cost of sales decreased by 6.9 million to 23.8 million leading to go to gross profit of 2.6 million truckers and decreased from the girl's property to have a coupon and I mean, there for the same period last year and.
Overall gross margin of 9.7% for the second quarter two so neglecting.
For the credit a quarter of 2020, I stand <unk> expenses increased by 39 foreign brokers and to see if one to 4 million and a lot from operations, while they're point 8 million compared to income from operations or was there a 405 minutes.
Same period of last year operating in an off market and were 3% compared to your operating margin.
1.6 presented for the same period of last year.
Youre stuck in the quarter with tears and it's running.
Not locks work 1 million, there's nothing on that loss of four cents per basic and already this year. This compares to you or net income, but their point of funding there are not anchor tenants in the basic and diluted share within here last year.
For seven o'clock or to send the twining earnings before interest.
Got sees the presentations and conversations decreased by 1.7 minutes to 2.9 billion from four point assessment I enjoy same period of last year.
Now shifting gears here year to date financial results for Christmas and data just got into its own. It's running total revenue decreased 31 point is 3% to city by according to 1 million as a result to the decreases in they are they well all paper products combined with significant <unk>.
Chris in South, Florida, offset printing paper products. This was also partially offset by increases in volume of tissue paper products.
[noise] horses mouth to any of the June 30 inches Donuts wanting the stampede government, including both wrangler and the nights a week stampede generated revenue of 29.6 million.
Renting 94.4% of total revenue granted they fall into one minute a revenue, whereas from our regular them they've got that.
And the six corn environment, there was some light weight CMP.
One of them for the centerpiece segment decreased by.
17% to 78257 town of wage 50700, and that 57 down what reckless empty and the 17500 town why light weight CMP that people are rapidly them take decreased.
By 14.8 presented tier 380 put now why asked people light weight CMP decreased by 40.3 presented to you a 372 could town.
For a six month ended June 32020 outside the creating paper segment generated revenue of 1.3 minutes, which shifted to now than the 183 cows to have offset printing paper outdoor six months' Andy just 13 2000 attending a decrease of seven April.
<unk>, 0.5% wrong. The interior last year. He asked people offset printing paper it decreased by 20.7 facilities U 578 account.
For a six month any the Jones 13, 2020 tissue paper that.
Generated revenue of 3.4 million increase to buy there on the streaming all 11.1%. This has resulted from sales of 4006 piece nightgown tissue paper products with a 42.4% increase.
And they ask Pete.
800, and ready to put town with a decrease of 22%.
For six months and lead the Jones 13 tools on the 21st Mascus generated revenue of 13.8 minutes with south of all of them Oh, six now than the 280000 to pieces of this masks.
For six months and either do city tools on the driving further cost over sales decreased by 15.6 million to 23.
Too early to call. It 32 point, if there are many leading to total glass copy to other 2.32 point, a formulaic and a decrease of 20% from last year overall gross margin of 6.8% reflects an increase of 1.5 percentage point.
So I'm not here.
For a six month ended June 30 interest on the 20 as Dan <unk> expenses were 6 million compared to 5.4 million for some period of last year.
Now some operations increased the from 2.6 million two or 3.7 million operate in large market on worse or pinpoint a full percentage compared to operating loss margin Oh vifor into 2% for them carried out last year.
Net loss was three point of blocking it Oh 14 cents.
Now as per basic and diluted share compared to not allowed to over 2.3 minute a natural out of 10 cents per basic and diluted this year well its interior last year.
Well, it's six months ending June 32, the under 20 earnings before interest taxes, depreciation and amortization decreased from 5.4 minutes you won't get enforce the same here the have nots, you're lowering his life in 19 and 20, let's look I feel our balance sheet.
And the liquidity.
As of June 13th Tucson, That's running the company had the cash and the bad Bank balances Shocker, DAC, including bank loans current Arsenal long term loans from credit Union and irradiated body alone.
And your long term debt, including loans were only credit Union Oh.
<unk> point.
Eightmillion.
10.4 million and the fight for under 2 million respectively compared to.
Slide four to eight minutes eight point, threemillion and some corner formula respectively.
End of appears on the 19th.
Net accounts receivable was 3.2 million as of June 13 to Thunder 20, compared to 3.1 minute as of December 31st if you're going to 19 that inventory where.
For 9 million as of June 30, just under 20 compared to 1.6 minutes.
And altitude under Nike.
As of June 30 inches under 20 compete head to current assets of 20.
7.8 million and on current liabilities of 15.6 million regarding our working capital and or under 2 million. This was compared to current assets of 24 point.
There are 4 million and the current liabilities of.
It's important to 8 million resulted in our working capital of California to meaning at the end up appears on the Nike.
Net cash provided by operating activities was 5.9 million plus ending the quarter tears and it's running compared to net cash used in operating activities of the girl 0.8, Atlanta for the same period last year net cash used in marketing activities to where they're appointed.
998 million Boes a.
Second quarter of just under 20 compared to 5.0 cumulative for the same period last year not a cash provided by financing activities were 2.3 million was down in the quarter isn't a 20 compared to net cash used in financing activity.
5.3 minute posed endeared of last year.
If you have any questions. Please contact us through email at <unk> I keep acting dark C.N. Magid men, who will respond to your questions do emails as soon as possible.
Operator, let's go ahead.
Thank you for attendee I teach <unk> packaging, so second quarter Twentytwenty earnings Conference call. This conference call today and you. Thank you all for listening in Goodbye.
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Hello, ladies and gentlemen, and welcome to participate in detect Packagings second quarter Twentytwenty earnings.
This conference call at this time I would like to inform you that this conference is being recorded it at all participants are in listen only mode.
Joining us today are Mr. Shenya view, I detect packagings, chairman and Chief Executive Officer in this Jing Hao, the company's Chief Financial Officer.
Remarks from both misled you and Ms. Hao will be delivered in English buy into but as.
I could take packaging analyses second quarter 20 to 20 financial results.
Your press release yesterday, which can be found that the company's website at <unk> people, you W. Dot I T packaging dot Seattle.
First Mr that you will brief you on the company's key operational highlights over the second quarter 20 to 20, and then Ms. Hao.
The Companys financial results.
Before we start I would like to draw your attention I was safe Harbor statement.
Management's prepared remarks contain forward looking statements within the meaning of is it safe Harbor provisions.
Private Securities Litigation Reform Act of 99 to five.
All statements about it and statements of historical facts and its announcements are forward looking statements, including but not limited to anticipated revenues somebody corrugating medium paper.
Tissue paper, offset printing paper and face mask business segments. The actions it initiatives, all current and potential competitors the company's ability to introduce.
Products.
The company's ability to easily make capacity expansion market acceptance of new products.
<unk> economic and business conditions, the ability to attract retain qualified senior management personal and research and development staff.
These risks detailed in the company's fightings.
The situation is an exchange commission.
These forward looking statements involve known and unknown risks and uncertainties and are based on current expectations assumptions estimates and projections about the company.
The industry.
The company undertakes no obligation to update forward looking statements to reflect subsequent events or circumstances.
The changes any expectation, except as maybe a us maybe required by law.
Although the company believes the expectations expressed in these forward looking statements or reasonable it cannot assure you that this expectation will turn out to be correct and investors are cautioned that actual results may differ materially from the anticipated results.
I think presentations document teach me management's prepared remarks, and it is now available for download from the company's website that chip will you W. dot IC packaging dot.
Please note that they'll be discussion on non-GAAP financial measure or EBITDA or earnings before interest taxes depreciation and amortization.
Please refer to our press release wake up seats because of the age and I'll give you that to net income.
I think tied to lighter or not but in our presentation. Our code at U.S., others, and all comparisons for the year over year comparisons and is unless otherwise stated.
I'd like to try to call over to Mr. Li Yu. His comments will be that anybody in English by it'd be a by he's issues on every investor relations.
Got you. Please go ahead.
Thank you operator, and good morning, everyone.
Well generally our second quarter 2020 earnings conference call.
Despite the always fields and operations were impacted by the called with Nike that make during the first quarter, we need improvement in the second quarter, that's almost people who've ducks.
Recovered at new fees mosque business bounced eco generated revenue of 8.9 million Weve gross margin of 15 <unk>.
<unk> 0.5 person in the second quarter, all work tissue people continued Oh hundreds group revenue on the hate above historical highs, we huge volume off 2800, and if you go towns.
Due to the pandemic impact to downstream industry.
We experienced a 13% to 21 person to decrease.
He asked Pete.
Well all people products categories. However.
Access to offset printing paper, we did not see much seals volume fluctuations from although people products. During the second Walter So we believe that underlying demand for our products remains strong and we expect the overall performance will continue to be improved.
He asked piece for all people products become deep realized when the to a pandemic economy recovery continues through the whole industry cheap.
Now I will turn the call over two hours have Oh, No gene Hall, who will review the common all the second quarter financial results Hook, how much will be delivered in English by my colleague Jen Wong Jenny. Please go ahead.
[noise].
And your line is open. Please go ahead.
Right.
[laughter], everyone will be all the cool.
On behalf of management team I'll summarize some okay financial results, both seven o'clock Cup of tea assigned a drain also all the occasionally with great kids are the big reduction light to occur shaky to wait the virus Braga.
I'll, let me clear, which brought her I'm, referring to reference there never existed in the four hour Productionized a club Rite aid on slide number 18.
The article Count all financial performance for the second Walker. Please turn to 20 Grace parents now I can understand that.
For seven o'clock or kids in a 20 telco revenues decreased to 21.6 person to 26 going for a minute.
It is a decrease in average selling prices for all paper pockets.
By other ways, a significant decrease in south, Florida offset printing paper.
Which was also partially offset by increasing spoke about him all the piece on paper products.
Turning to slide eight.
For the seven o'clock or other peers, and a 26 m. piece government, including boats regular CMP and the light weight CMP getting ready to revenue over 21.9 American.
Presenting it is 3% to other total revenue.
So he points for many other revenue was from our Rep recollect unpaid Gaga and a book one a bond there there was some like awake and he.
SMB segment devoted was slightly decreased by 1.6 to send it to 59000.
500.
90 pounds.
Wage 46000, and I can do it and that 17 Iconix worse.
Well I recollect empty and a two hour Gallagher six injured and having gone through our light weight CMP outbreak is selling price all areas people recognize them they decreased by 15% tier 370 pounds.
I asked the pool right of way Stampede decreased by 15.4% to 357, Yeah, Karen just like nine.
Our second quarter, two you're going to training they offset printing paper generated revenue of 1.3 minute decreased by 5 million all 79.8% from that didn't period last year.
The offset printing paper voters decreased by 74.5, Kristen it too.
2000, and the ran through the end 83 down yes people offset printing paper it decreased the bike ride important parts into Q4 hundred and 78 account.
Turning to slide 10.
Tissue paper congrats.
Generated revenue of 2.4 minute increased by 1.2, Minera, Oh 104 under 2%.
Basically is OK strong so.
Your color and.
Enjoyed an 84 accounts tissue.
Sorry about that with Andrew the illustrative listen to increase I didn't ask the.
800, and a 25 rig count.
As a decrease of.
13%.
Turning to slide 11, waistcoat, they kind of your fixed I wondered if you had good and 80000 pieces of freight mark and to generate either revenue or who deserve 0.8, and then have grown study.
It's mark its board back in the quarter She's done 20.
Right and I love to summarize a there 10 days in our revenue mix.
Seven o'clock over to you're going to train total cost of sales decreased by 6.9 mailings to 23.8 in their leading to greater gross profit.
He was born Sixmillion truck sales decreased from the glass copied or coupon a nightmare for sale period last year and overall gross margin of 9.7 per cent for the second quarter of just under 20.
Boyfriend and acquire Oak to the 20 I stand expenses increased by 39 boring Wilkerson, two three or four under formula and a lot from operations well go for the 8 million compared to income from operations or was there. According to find Miller was.
In period last year operating in an off market, where stray per cent compared to your operating margin.
1.6% before the same period of luck to year for stuck in the quarter, but she has done a 29.
Not locks work one minute resaca into another loss of four cents per basic and Dirty. This year. This compares to you or not income, but there's quite a phenomenon or net income of two cents basic and diluted share works in theory that last year.
For seven o'clock or to send the planning are nice before interest.
Got sees the price teachers and I'm sorry. This has decreased by 1.7 minutes to 2.9 billion from four point assessment I unsolicited period of last year.
Shifting gears here year to date financial results for Christmas and day that you're starting to turn the twining poker revenue decreased 31 point, a straight pretended to cities like when the one minute as a result was a decrease in as Dave well all paper products combined ways, you're Gonna Griffin Securities.
Chris in South, Florida, offset printing paper products. This was also partially offset by increases in volume of tissue paper products.
Horses mouth, Andy that you're starting to go nuts wanting the San <unk> government, including both regular and the lighter weight Stampede generated revenue of 29.6 million, representing 94.4% of cocoa Rand grandees people in the one minute a running your words.
Our regular them they've got that.
And if it's going to find there was some light weight CMP bottom for the centerpiece segment decreased by.
70% to 78257 pounds, a wage 50000 to fabric injured and that 57 down what restless energy and that 17500 town why light weight CMP as people are rapidly FMT decreased.
Hi, 14.8% to tier 380 put out why asked people like a week guaranteed decreased by 40.3% exceeded 317 to you could town.
For a six month ended June 32020 outside the printing paper segment generated revenue of one point distributor leadership good to know than the 183 cows offset printing paper fill a six month and a generic into its own attaining a decrease of April.
0.5, then well that's in period last year. He asked people offset printing paper decreased by 20.76 into Q4 hundred and 78 cow.
Well, it's it's not the any the Jones 13 piece on the 20 tissue paper that.
Generated revenue of 3.4 million increase goodbye, they're reporting extremely well 11.1%.
Okay to from South of <unk>.
I'm proud of the six <unk> nine com tissue paper products with a 42.4% increase.
And the ASP Oh.
800, and ready to put town like a decrease of 22%.
It's not the any the Josephine tooth on the 21st Mascus generate a revenue because there are quite an Asian minute without water Oh, six now than the 200 and the 80000 pieces of this month.
For six months, Andy the two cities you've done the driving her cosco sales decreased by 15.6 million to 23.
Too early to call. It 32 board has gotten any needing to do do glass copy to other 2.32 point, a formulaic and a decrease of 20% from last year.
Gross margin of 6.8% reflects an increase of 1.5 percentage points from last year.
For a six month, Andy the Josephine truth on the 20 as Dan <unk> expenses were 6 million compared to 5.4 million for some period of last year.
Yes, so I'm operations increased the from 2.6 million Telus reported a seven day operating losses market on where the pinpoint a full percentage compared to operating margin of 5.2% for some period up last year.
Yeah lots were three point of Lumpiness, Oh 14 cents.
Not per basic and diluted share.
There are two not allowed to open viewpoint distributed a natural out of 10 cents per basic and diluted EPS year, plus interior last year.
Well, it's six months ending June 32 to under 20 earnings before interest taxes, depreciation and amortization decreased from 5.4 minutes you won't get it for the same period, you're lowering his life and Nike and a 29 Luikart go out.
Shaped and the liquidity.
I go for June 13th just under 20, the company had a cash and that back.
I see shocker back including backlog.
Arsenal long terminals from gradually and irradiated body alone.
And your long term debt, including alone squarely credit Union.
Okay.
Truck flying.
8 million.
Pinpoint formulary and the flight for under 2 million respectively compared to.
For the 8 million export of streaming and Sampoerna formula respectively.
And as a pure dollar Nike.
Net accounts receivable was shape wonder to me there as of June 13 to go under 20 compared to 3.1 minute as of December 31st appeared on the Nike Golf and country were 5.9 million <unk> as of June 13, just under 20 compared to.
Were 1.6 minutes, I said and I was confused on the Nike.
As of June for into Thunderx running the company had a current assets all 20.
7.8 million and on current liabilities of 15.6 million regarding our working capital.
Important to 2 million this was compared to current assets of two on April coin.
Zero formulary and the current liabilities.
It's important to eight minutes the healthy in our working capital I'll jump on it to me at the end up with you've done a Nike.
Yes cash provided by operating activities was 5.9 million sports betting the clock or twos, and it's running compared to net cash used in operating activities of the go forward and they didn't name for the same here a lot you're not cash used in marketing activities, where they're reporting.
Night 98 million at both the.
Secondly, Clark of chicken adorning compared to five point, if there were 2 million for the same period last year not a cash provided by friends. They activities were 2.3 million worked out in quark or kids and a 20 compared to net cash used in financing activities.
5.3 minutes poses endeared of last year.
If you have any questions. Please contact us through email at <unk> I didn't acting dark C.N. Magid man, who will respond to your questions do in it was still as possible.
Operator, let's go ahead.
Thank you for attendee I teach <unk> packaging since second quarter Twentytwenty earnings Conference call. This conference call today and we thank you all for listening in Goodbye.