LOS ANGELES, May 13, 2015 /PRNewswire/ -- Nova LifeStyle, Inc.
(NASDAQ-GM: NVFY), a U.S.-based fast-growing, innovative designer,
manufacturer and distributor of modern LifeStyle furniture, today
announced financial results for the first quarter ended
March 31, 2015.
First Quarter 2015 Corporate and Financial
Highlights:
- Net sales were $22.0 million, an
increase of 23% compared to the prior year period.
- Gross profit was $4.1 million, an
increase of 25% compared to the prior year period. Gross margin
remained at 18%, in line with the prior year period.
- Net income was $1.6 million, or
$0.08 per diluted share, compared to
$0.3 million or $0.02 per diluted share in the prior year
period.
- Repeat purchase orders secured from Nebraska Furniture Mart, a
Berkshire Hathaway Company in the U.S.,
- Four additional SKUs added to production agreement with IKEA
China.
"We entered 2015 on a solid footing with the launch of our
newest luxury furniture collection, which has a unique and elegant
design without compromising on comfort," commented Jeffrey Wong, CEO of Nova LifeStyle. "The
improved results in the first quarter were driven by success in
both North American and Asian markets, where we have significantly
intensified our marketing efforts resulting in more direct sales
and a diversified customer base. In addition to securing new
customers, we made several repeat sales to major, reputable
distributors, demonstrating continued demand for our high quality
and stylish furniture products and reaffirming our confidence in
our strategy to target the growing global middle class," concluded
Mr. Wong.
Corporate update for the first quarter ended March 31, 2015:
North America
The Company continued to execute on its growth initiative to
increase sales in North America.
Sales to North America were
$15.12 million in the three months
ended March 31, 2015, an increase of
34.6% from $11.23 million in the same
period of 2014, driven by increased marketing efforts in the U.S.
markets.
During the first quarter 2015, Nova LifeStyle secured additional
purchase orders from Nebraska Furniture Mart, an Omaha-based subsidiary of Berkshire Hathaway
Inc., to supply furniture to Grandscape in Dallas, Texas. Grandscape is a new real estate
development expected to open in the spring of 2015. The development
will cover 90 acres, with a 560,000 sq. ft. retail furniture and
home wears showroom and a 1.3 million sq. ft. distribution center.
Grandscape is expected to attract 8 million visitors its first
year.
North America remains Nova
LifeStyle's largest, and fastest growing, market.
China and other parts of
Asia
In China, overall sales
increased by 22.5% to $3.8 million in
the three months ended March 31,
2015, as compared to $3.1
million in the same period of 2014.
During the first quarter 2015, Nova LifeStyle secured an
agreement with IKEA, the privately owned Swedish furniture seller,
to add four additional SKUs to its existing production to continue
to supply its China stores. The
target for the initial shipment of the four new SKUs is in the
second quarter of this year with an estimate of $4-6M in revenue for these SKUs for the first
full year of production. IKEA, the world's largest furniture chain
with global sales estimated at over $38bn annually, owns and operates 350 stores in
43 countries with eight of IKEA's 10 largest stores located in
China.
The Company's sales to other parts of Asia Pacific, including Hong Kong, Australia, and other countries, increased 9.9%
to $0.73 million in the three months
ended March 31, 2015, as compared to
$0.66 million in the same period of
2014.
Europe
Sales to Europe were
$2.42 million in the three months
ended March 31, 2015, a decrease of
17% from $2.91 million in the same
period of 2014 as a result of the slow European economy.
Results for the Fiscal First Quarter Ended March 31, 2015
Net sales for the three months ended March 31, 2015, were $22.03 million, an increase of 23% from
$17.88 million in the same period of
2014; this increase in net sales resulted primarily from a 33%
increase in average selling price with a 13% decrease in sales
volume.
Gross profit increased 25.02% to $4.07
million in the three months ended March 31, 2015, compared to $3.25 million in the same period of 2014. The
increase in gross profit resulted primarily from increase of net
sales. Gross profit margin remained flat at18% in the three months
ended March 31, 2015, compared with
the same period of 2014.
Operating income was $0.9 million,
compared to $0.55 million in
the same period of 2014.
Other income was $925,785 in the
three months ended March 31, 2015,
compared with other expenses of $78,664 in the same period of 2014, an increase
of $1,004,449. The increase in other
income was due primarily to change in fair value of warrant
liability of $972,645.
Net income was $1.62 million in
the three months ended March 31,
2015, an increase of 435% from $0.30
million for the same period of 2014. Net profit margin was
7% in the three months ended March 31,
2015, an increase of 5% from 2% for the same period of 2014.
The increase in profit margin resulted primarily from income from
the change in fair value of warrant liability, which is a non-cash
and non-taxable income.
Cash and cash equivalents were $1.32
million at March 31, 2015, as
compared to $1.24 million as of
December 31, 2014.
Conference Call
Nova LifeStyle management will host a conference call to discuss
the financial results at 8:30 a.m.
ET/ 5:30 a.m. PT today,
Wednesday, May, 13, 2015.
Investors in the U.S. interested in participating in the call
should dial 1-888-389-5988 and reference passcode
8826232. Those calling from outside the U.S. should dial
1-719-785-1753 and reference passcode 8826232. A
telephone replay will be available approximately three hours after
the call until May 27, 2015 by
dialing 1-877-870-5176 from the U.S. or 1-858-384-5517 from
international locations, with passcode 8826232.
A simultaneous live webcast will be available on the Investor
Relations section of the Company's website at hopto.com and on the
Company's Investor Relations mobile app, powered by IRapp™.
The webcast will be archived on the Company's website for one
year.
About Nova LifeStyle, Inc.
Nova LifeStyle, Inc., a NASDAQ Global Markets Exchange listed
company headquartered in California, is a fast growing, innovative
designer, manufacturer and distributor of modern LifeStyle
furniture; primarily sofas, dining rooms, cabinets, office
furniture and related components, bedrooms, and various accessories
in matching collections. Nova's products are made in the US,
Europe, and Asia and include LifeStyle brands such as
Diamond Sofa, Colorful World, Giorgio
Mobili, Nova QwiK, and Bright
Swallow International. Nova's products feature urban contemporary
styles that integrate comfort and functionality incorporating
upscale luxury designs appealing to LifeStyle-conscious middle and
upper middle-income consumers in the U.S., China, Europe, and elsewhere in the world. To learn
more about Nova LifeStyle, Inc., please visit our website at
www.NovaLifeStyle.com or download the NVFY IRapp from the investor
page.
Safe Harbor Statement
All statements in this press release that are not historical are
forward-looking statements made pursuant to the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995.
There can be no assurance that actual results will not differ from
the company's expectations. You are cautioned not to place undue
reliance on any forward-looking statements in this press release as
they reflect Nova's current expectations with respect to future
events and are subject to risks and uncertainties that may cause
actual results to differ materially from those contemplated.
Potential risks and uncertainties include, but are not limited to,
the risks described in Nova's filings with the Securities and
Exchange Commission.
Investor Contact:
KCSA Strategic Communication
Julie Silber
Tel: (310) 766-9760
jsilber@kcsa.com
NOVA LIFESTYLE,
INC. AND SUBSIDIARIES
|
|
CONSOLIDATED
STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
|
|
FOR THE THREE
MONTHS ENDED MARCH 31, 2015 AND 2014
|
|
|
Three Months Ended
March 31,
|
|
2015
|
|
2014
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
Net
Sales
|
$
22,032,478
|
|
$
17,882,892
|
|
|
|
|
Cost of
Sales
|
17,965,725
|
|
14,630,017
|
|
|
|
|
Gross
Profit
|
4,066,753
|
|
3,252,875
|
|
18%
|
|
18%
|
Operating
Expenses
|
|
|
|
Selling
expenses
|
1,265,856
|
|
735,345
|
General and
administrative expenses
|
1,905,610
|
|
1,962,629
|
|
|
|
|
Total Operating
Expenses
|
3,171,466
|
|
2,697,974
|
|
|
|
|
Income From
Operations
|
895,287
|
|
554,901
|
|
|
|
|
Other Income
(Expenses)
|
|
|
|
Non-operating income,
net
|
29,576
|
|
19,658
|
Foreign exchange
transaction income
|
6,328
|
|
--
|
Change in fair value
of warrant liability
|
972,645
|
|
--
|
Interest
expense
|
(63,681)
|
|
(63,451)
|
Financial
expense
|
(19,083)
|
|
(34,871)
|
|
|
|
|
Total Other Income
(Expenses), Net
|
925,785
|
|
(78,664)
|
|
|
|
|
Income Before
Income Tax
|
1,821,072
|
|
476,237
|
|
|
|
|
Income Tax
Expense
|
196,209
|
|
172,685
|
|
|
|
|
Net
Income
|
1,624,863
|
|
303,552
|
|
|
|
|
Other
Comprehensive Income
|
|
|
|
Foreign currency
translation
|
(68,658)
|
|
(131,499)
|
|
|
|
|
Comprehensive
Income
|
$
1,556,205
|
|
$
172,053
|
|
|
|
|
Basic weighted
average shares outstanding
|
20,912,582
|
|
19,348,479
|
Diluted weighted
average shares outstanding
|
20,912,582
|
|
19,548,665
|
|
|
|
|
Basic net earnings
per share
|
$
0.08
|
|
$
0.02
|
Diluted net earnings
per share
|
$
0.08
|
|
$
0.02
|
NOVA LIFESTYLE,
INC. AND SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
MARCH 31, 2015
(UNAUDITED) AND DECEMBER 31, 2014
|
|
|
|
|
|
March 31,
|
|
December
31,
|
|
2015
|
|
2014
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
|
Cash and cash
equivalents
|
$
1,318,398
|
|
$
1,244,308
|
Accounts receivable,
net
|
42,541,749
|
|
42,971,510
|
Advance to
suppliers
|
5,865,449
|
|
8,104,312
|
Inventories
|
5,870,234
|
|
3,612,868
|
Prepaid expenses and
other receivables
|
447,066
|
|
641,208
|
Deferred tax
asset
|
118,655
|
|
118,866
|
|
|
|
|
Total Current
Assets
|
56,161,551
|
|
56,693,072
|
|
|
|
|
Noncurrent
Assets
|
|
|
|
Heritage
and cultural assets
|
132,012
|
|
132,513
|
Plant, property and
equipment, net
|
14,300,274
|
|
14,377,909
|
Construction in
progress
|
1,488,712
|
|
1,378,860
|
Lease
deposit
|
97,151
|
|
96,096
|
Deposits for equipment
and factory construction
|
1,264,459
|
|
1,264,551
|
Goodwill
|
218,606
|
|
218,606
|
Intangible assets,
net
|
6,562,230
|
|
6,493,726
|
|
|
|
|
Total Noncurrent
Assets
|
24,063,444
|
|
23,962,261
|
|
|
|
|
Total
Assets
|
$
80,224,995
|
|
$
80,655,333
|
|
|
|
|
|
|
|
|
NOVA LIFESTYLE,
INC. AND SUBSIDIARIES
|
|
|
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
MARCH 31, 2015
(UNAUDITED) AND DECEMBER 31, 2014
|
|
|
|
|
|
March 31,
|
|
December
31,
|
|
2015
|
|
2014
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
Accounts
payable
|
$
8,769,745
|
|
$
10,454,485
|
Line of
credit
|
8,374,908
|
|
7,592,879
|
Advance from
customers
|
135,626
|
|
123,673
|
Accrued liabilities
and other payables
|
1,880,935
|
|
2,470,284
|
Warrant derivative
liability
|
492,374
|
|
1,465,019
|
Taxes
payable
|
101,316
|
|
61,769
|
|
|
|
|
Total Current
Liabilities
|
19,754,904
|
|
22,168,109
|
|
|
|
|
Noncurrent
Liabilities
|
|
|
|
Deferred rent
payable
|
89,693
|
|
85,077
|
Deferred tax
liability
|
12,359
|
|
12,199
|
Income tax
payable
|
6,711,880
|
|
6,607,739
|
|
|
|
|
Total Noncurrent
Liabilities
|
6,813,932
|
|
6,705,015
|
|
|
|
|
Total
Liabilities
|
26,568,836
|
|
28,873,124
|
|
|
|
|
Contingencies and
Commitments
|
|
|
|
|
|
|
|
Stockholders'
Equity
|
|
|
|
Common stock, $0.001
par value; 75,000,000 shares authorized, 20,975,316 and 20,897,316 shares issued and
outstanding as of March 31, 2015
and December 31, 2014
|
20,975
|
|
20,897
|
Additional paid-in
capital
|
25,069,143
|
|
24,751,476
|
Statutory
reserves
|
6,241
|
|
6,241
|
Accumulated other
comprehensive income
|
2,506,509
|
|
2,575,167
|
Retained
earnings
|
26,053,291
|
|
24,428,428
|
|
|
|
|
Total
Stockholders' Equity
|
53,656,159
|
|
51,782,209
|
|
|
|
|
Total Liabilities
and Stockholders' Equity
|
$
80,224,995
|
|
$
80,655,333
|
|
-
|
|
-
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/nova-lifestyle-reports-first-quarter-2015-results-300082393.html
SOURCE Nova LifeStyle, Inc.