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    Ever-Glory Fourth Quarter 2021 Financial Results

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    Ever-Glory Fourth Quarter 2021 Financial Results

    NEW YORK, April 13, 2022 /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, reported its financial results today for the full year ended December 31, 2021.

    Mr. Yihua Kang, Chairman, President and Chief Executive Officer of Ever-Glory, said, “During the full year of 2021, we maintained our focus on developing the retail business through our multi-brand strategy and store network optimization initiative, while improving our wholesale business by upgrading customer portfolio and enhancing our account receivables.”

    “During the full year of 2021, our retail brands continue to attract new customers and retain existing customers by focusing on design, quality and value,” Mr. Kang continued. “Following the remodeling or relocation of 137 stores during 2021, we operated a nationwide network of 880 stores as of December 31, 2021.”

    “Looking at our wholesale business, we maintained focus on upgrading customer portfolio to reduce credit risk and improve margin in light of weak micro-environment and enhancing our account receivables. Going forward, we’ll implement a stricter client evaluation system and remain diligent in our account receivables collection. We believe the enduring strength of our wholesale business will support its long-term profitability,” Mr. Kang concluded.

    Mr. Jason Jiansong Wang, Chief Financial Officer of Ever-Glory, added, “The full year results are coupled with our ability to increase operating leverage. Going forward, we remain confidence in the long-term prospects of our business and we will continue implementing our margin enhancement and cost control measures to further strengthen the profitability of our business.”

    Full year 2021 Financial Results 

    Total sales for the full year of 2021 were $331.0 million, an increase of 23.8% from $267.4 million in the full year of 2020. This increase was primarily driven by a 57.8% increase in our wholesale business partially offset by a 2.7% decrease in retail business.

    Sales for the Company’s branded fashion apparel retail division decreased by 2.7% to $146.1 million for the full year of 2021, compared with $150.1 million for the full year of 2020. This decrease was primarily due to a decrease in same store sales. The Company operated 880 retail stores as of December 31, 2021, compared with 936 retail stores as of December 31, 2020.

    Sales for the Company’s wholesale division increased by 57.8% to $184.9 million for the full year of 2021, compared with $117.2 million for the full year of 2020. This increase was primarily attributable to increased sales in Mainland China, Hong Kong China, Europe-Other, Japan and United States. 

    Total gross profit for the full year of 2021 increase by 10.7% to $101.0 million, compared with $91.2 million for tthe full year of 2020. Total gross margin for the full year of 2021 decreased to 30.5% from 34.1% for the full year of 2020.

    Gross profit for the retail business increase by 3.6% to $63.7 million for the full year of 2021, compared with $61.5 million for the full year of 2020. Gross margin for the full year of 2021 was 43.6% compared to 40.9% for the full year of 2020.

    Gross profit for the wholesale business increased by 25.4% to $37.3 million for the full year of 2021, compared with $29.7 million for the full year of 2020. Gross margin for the full year of 2021 decreased to 20.2% from 25.4% for the full year of 2020.

    Selling expenses for the full year of 2021 increased by 12.8% to $63.1 million, or 19.1% of total sales, compared with $55.9 million, or 20.9% of total sales for the full year of 2020. The increase was attributable to the higher travelling expenses.

    General and administrative expenses for the full year of 2021 increased by 23.2% to $38.4 million, or 11.6% of total sales, compared with $31.2 million, or 11.7% of total sales for the full year of 2020. The increase was attributable to the increased salaries.

    (Loss) Income from operations was ($0.5 million) for the full year of 2021, compared to $4.1 million for the full year of 2020.

    Net loss attributable to the Company for the full year of 2021 was ($0.09 million )compared with 3.3 million for the full year of 2020. Basic and diluted loss per share were ($0.01) for the full year of 2021 compared with $0.22 for the full year of 2020.

    Balance Sheet 

    As of December 31, 2021, Ever-Glory had approximately $56.6 million of cash and cash equivalents, compared with approximately $81.9 million as of December 31, 2020. Ever-Glory had working capital of approximately $51.0 million as of December 31, 2021, and outstanding bank loans of approximately $69.0 million as of December 31, 2021.

    Conference Call

    The Company will hold a conference call at 8:00 a.m. Eastern Time on April 13, 2022(8:00 p.m. Beijing Time on April 13, 2022). Listeners can access the conference call by dialing +1-800-239-9838 or +1-323-794-2551 and using the access code 1990321. The conference call will also be webcast live over the Internet and can be accessed at the Company’s website at http://www.everglorygroup.com.

    A replay of the call will be available from 11:00 a.m. Eastern Time on April 13 through 11:59 p.m. Eastern Time on April 20 by calling +1-844-512-2921 or +1-412-317-6671 with pin number 1990321.

    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”, “idole” and  “Jizhu”. 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.

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    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
    Huilin Hua
    Tel: +86-25-52096859
    E-Mail: huahuilin@ever-glory.com.cn

    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 DECEMBER 31, 2021 AND 2020

    December 31,
    2021

    December 31,
    2020

    ASSETS

    CURRENT ASSETS

         Cash and cash equivalents

    $

    56,573

    $

    81,865

         Restricted cash

    40,768

    39,858

         Trading securities

    3,251

    1,792

         Accounts receivable, net

    69,859

    53,285

         Inventories

    63,841

    53,893

         Advances on inventory purchases

    8,179

    10,261

         Value added tax receivable

    1,693

    1,244

         Other receivables and prepaid expenses

    6,345

    5,479

         Amounts due from related parties

    220

    567

    Total Current Assets

    250,729

    248,244

    NON-CURRENT ASSETS

         Equity security investment

    5,682

    3,932

         Intangible assets, net

    4,794

    4,794

         Property and equipment, net

    36,340

    32,164

         Operating lease right-of-use assets

    50,077

    41,690

         Deferred tax assets

    899

    902

         Other non-current assets

    784

    –

    Total Non-Current Assets

    98,576

    83,482

    TOTAL ASSETS

    $

    349,305

    $

    331,726

    LIABILITIES AND STOCKHOLDERS’ EQUITY

    CURRENT LIABILITIES

         Bank loans

    $

    68,992

    $

    65,919

         Accounts payable

    67,930

    67,762

         Accounts payable and other payables – related parties

    1,332

    3,764

         Other payables and accrued liabilities

    18,531

    16,073

         Value added and other taxes payable

    999

    909

         Income tax payable

    334

    1,062

         Current operating lease liabilities

    41,633

    33,481

    Total Current Liabilities

    199,751

    188,970

    NON-CURRENT LIABILITIES

    Non-current operating lease liabilities

    8,596

    8,307

    TOTAL LIABILITIES

    208,347

    197,277

    COMMITMENTS AND CONTINGENCIES (Note 9)

    STOCKHOLDERS’ EQUITY

         Common stock ($0.001 par value, authorized 50,000,000 shares, 14,812,312 and
             14,809,160 shares issued and outstanding as of December 30, 2021 and
             December 31, 2020, respectively)

    15

    15

         Additional paid-in capital

    3,660

    3,650

         Retained earnings

    108,210

    109,171

         Statutory reserve

    21,245

    20,376

         Treasury stock (as cost,147,334 shares at December 30, 2021)

    (363)

    –

         Accumulated other comprehensive income

    8,191

    4,590

         Amounts due from related party

    (3,353)

    Total equity

    140,958

    134,449

    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

    $

    349,305

    $

    331,726

    EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES

    CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

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

    FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 

    2021

    2020

    NET SALES

    $

    330,978

    $

    267,354

    COST OF SALES

    230,026

    176,141

    GROSS PROFIT

    100,952

    91,213

    OPERATING EXPENSES

      Selling expenses

    63,074

    55,894

      General and administrative expenses

    38,416

    31,176

    Total operating expenses

    101,490

    87,070

    (LOSS) INCOME FROM OPERATIONS

    (538)

    4,143

    OTHER INCOME (EXPENSE)

      Interest income

    976

    1,014

      Interest expense

    (2,391)

    (2,345)

      Government subsidy

    1,163

    1,235

      Gain (loss) from changes in fair values of investments

    1,791

    (135)

      Other income

    1,852

    1,830

    Total Other Income, Net

    3,391

    1,599

    INCOME BEFORE INCOME TAX EXPENSE

    2,853

    5,742

    INCOME TAX EXPENSE

    (2,945)

    (2,469)

    (LOSS)NET  INCOME

    (92)

    3,273

    Net loss attributable to the non-controlling interest

    –

    7

    NET INCOME ATTRIBUTABLE TO THE COMPANY

    $

    (92)

    $

    3,280

    (LOSS)NET INCOME

    $

    (92)

    $

    3,273

      Foreign currency translation gain

    3,601

    8,920

    COMPREHENSIVE INCOME

    $

    3,509

    $

    12,193

    Comprehensive  income attributable to the noncontrolling interest

    –

    7

    COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY

    $

    3,509

    $

    12,200

    (LOSS)EARNINGS PER SHARE ATTRIBUTABLE TO THE COMPANY’S
    STOCKHOLDERS:

      Basic and diluted

    $

    (0.01)

    $

    0.22

    Weighted average number of shares outstanding Basic and diluted

    14,811,020

    14,806,778
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    EVER-GLORY INTERNATIONAL GROUP, INC. AND SUBSIDIARIES

    CONSOLIDATED STATEMENTS OF EQUITY

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

    FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 

    Additional

    Retained Earnings

    Accumulated
    other

    Amounts
    due
    from

    Total
    equity
    attributable
    to stockholders

    Non-

    Common Stock

    paid-in

    Treasury
    Stock 

    Statutory

    Comprehensive

    related

    of the

    controlling

    Total

    Shares

    Amount

    capital

    Unrestricted

    reserve

    income

    party

    Company

    Interest

    equity

    Balance at
       January 1,
       20    20

    14,801,770

    $

    15

    $

    3,640

    $

    –

    $

    106,328

    $

    19,939

    $

    (4,330)

    $

    (4,932)

    $

    120,660

    $

    (1,510)

    $

    119,150

    Stock issued for
       compensation

    7,390

    –

    10

    –

    –

    –

    –

    –

    10

    10

    Net income
       (loss)

    –

    –

    –

    –

    3,280

    –

    –

    –

    3,280

    (7)

    3,273

    Transfer to
       reserve

    –

    –

    –

    –

    (437)

    437

    –

    –

    –

    –

    Net cash paid to
       related party
       under counter
       guarantee
       agreement
       (Note 11)

    –

    –

    –

    –

    –

    –

    –

    1,579

    1,579

    –

    1,579

    Deconsolidation
       of Yiduo

    –

    –

    –

    –

    –

    –

    –

    –

    –

    1,517

    1,517

    Foreign
       currency
       translation
       gain

    8,920

    8,920

    –

    8,920

    Balance at
       December
       31, 2020

    14,809,160

    $

    15

    $

    3,650

    $

    –

    $

    109,171

    $

    20,376

    $

    4,590

    $

    (3,353)

    $

    134,449

    $

    –

    $

    134,449

    Stock issued for
       compensation

    3,152

    –

    10

    –

    –

    –

    –

    –

    10

    10

    Net income
       (loss)

    –

    –

    –

    –

    (92)

    –

    –

    –

    (92)

    –

    (92)

    Transfer to
       reserve

    –

    –

    –

    –

    (869)

    869

    –

    –

    –

    –

    Payments
       received
       from     party
       under counter
       guarantee
       agreement
       (Note 11)

    –

    –

    –

    –

    –

    –

    –

    3,353

    3,353

    –

    3,353

    Repurchase of
       147,334
       shares of
       common
       stock

    –

    –

    –

    (363)

    –

    –

    –

    (363)

    –

    (363)

    Foreign
       currency
       translation
       gain

    3,601

    –

    3,601

    –

    3,601

    Balance at
       December
       31, 202    1

    14,812,312

    $

    15

    $

    3,660

    $

    (363)

    $

    108,210

    $

    21,245

    $

    8,191

    $

    –

    $

    140,958

    $

    –

    $

    140,958

    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 YEARS ENDED DECEMBER 31, 2021AND 2020

    2021

    2020

    CASH FLOWS FROM OPERATING ACTIVITIES

      Net income

    $

    (92)

    3,273

           Adjustments to reconcile net income to cash provided by operating activities:

      Depreciation and amortization

    6,404

    5,291

      Loss from sale of property and equipment

    610

    209

      Loss on deconsolidation of a subsidiary

    –

    1,085

      Provision of bad debt allowance

    1,429

    1,117

      Provision for obsolete inventories

    6,735

    6,753

      Changes in fair value of trading securities

    (150)

    (131)

      Changes in fair value of investment

    (1,641)

    (819)

      Deferred income tax

    24

    154)

      Stock-based compensation

    10

    10

      Changes in operating assets and liabilities

    Accounts receivable

    (16,737)

    27,173

    Inventories

    (15,483)

    10,161

    Value added tax receivable

    (416)

    1,336

    Other receivables and prepaid expenses

    (710)

    (135)

    Advances on inventory purchases

    2,418

    (28)

    Amounts due from related parties

    3,563

    (480)

    Accounts payable

    (2,238)

    (9,316)

    Accounts payable and other payables- related parties

    (3,142)

    (1,145)

    Other payables and accrued liabilities

    3,083

    (3,098)

    Value added and other taxes payable

    71

    (806)

    Income tax payable

    (747)

    (148)

           Net cash (used in) provided by operating activities

    (17,009)

    40,456

    CASH FLOWS FROM INVESTING ACTIVITIES

      Purchases of property and equipment

    (10,123)

    (6,354)

      Net purchase of trading securities

    (1,309)

    (1,665)

    Investment payment

    (775)

    (2,936)

           Net cash used in investing activities

    (12,207)

    (10,955)

    CASH FLOWS FROM FINANCING ACTIVITIES

      Proceeds from bank loans

    73,340

    90,729

      Repayment of bank loans

    (71,790)

    (58,658)

      Repurchase of common stock

    363

    –

      Net collection of amounts due from related party (equity)

    863

    1,848

           Net cash provided by financing activities

    2,776

    33,919

    EFFECT OF EXCHANGE RATE CHANGES ON CASH

    2,058

    7,548

    NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH

    (24,382)

    70,968

    CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF
    PERIOD

    121,723

    50,755

    CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD

    $

    97,341

    $

    121,723

    Reconciliation of cash, cash equivalents and restricted cash reported within their consolidated
         balance sheets:

    Cash and Cash Equivalents

    56,573

    81,865

    Restricted cash

    40,768

    39,858

    $

    97,341

    $

    121,723

    SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

    Net asset (liabilities) derecognized due to deconsolidation of a subsidiary

    –

    $

    1,164

    Cash paid during the period for:

    Interest

    $

    2,391

    $

    2,345

    Income taxes

    $

    2,945

    $

    2,469

    Cision View original content:https://www.prnewswire.com/news-releases/ever-glory-fourth-quarter-2021-financial-results-301524707.html

    Source: Ever-Glory International Group, Inc.

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