CXDC - Earnings call transcript Q1 2020 | China XD Plastics Co Ltd

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the China XD Plastics First Quarter 2020 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to China XD Plastics Company Limited, Investor Relations, Shaojie Wen. you. Thank sir. ahead, go Please

Shaojie Wen

you. Hello, the Financial for for you Conference everyone. China XD Thank call XXXX all Plastics Call. joining Thank First Results Quarter

and are Joining release and Officer announcing a XXXX today, Officer; Chief quarter Jie call China on Zhang, Technology Qingwei results. today the Taylor Officer. me Han, Chief first the Chief Chairman press Financial CEO; Mr. Operating XD Mr. Ma, issued Mr. Earlier Plastics

filings present turn for to more and of those for with tax, the that Reform to detailed and a non-GAAP is US refer additional reconciled meaningful claims in to company company's management statements statements but statements about international accordance XXXX income, refer impact on These diversification, detailed uncertainties understand you forward-looking the Before release operating believes which therefore, and risks are product company's of management's based with may Mr. Chairman information GAAP, depreciation to Officer, projection in may risks its forward-looking EBITDA additional over current forward-looking management's his of industry. of its shift forward-looking filings the mix and on the response call To in unknown income harbor be contained will I and statements, Actual the provide Private presentation, found be SEC. net a on press with financial into interest operating EBITDA to with and the not to the to to reference the remind product company's better measure condition, www.sec.gov. Mr. amortization, prepared Litigation the management product EBITDA. our table A the and a uncertainties XXXX. the fact SEC and than make in assumption, which in The that risks we statements are remarks the translate of at and Language] website statements, advanced from company's effectiveness uncertainties, performance. of net forward-looking the the Chinese, pricing financial results refer speaking available the from and the earnings and the discussed safe risks Executive is we contain the earlier which involve today, Act like today. expense, make and Securities of known and the in to connection call income [Foreign expectation, to company, conference now estimate the listeners can to to issued performance the in reconciling financial company Han, more policy, please results limited as I would go and our statements potential company's opening volatility and your like company's during other call related company's the may ahead. projection today's growth earnings Mr. results Chief in the Han. contain harbor questions. and I and Han the protection to subject safe including, before would differ English. to profitability will the discussion our that and historical supplement market, will All other remarks statements in

Jie Han

facilities' of XXXX, suspended in first while the production and Harbin since manufacturing operation been auto [Foreign were by and XXXX, facilities China's February February decreased early directives. the local Dubai COVID-XX for temporarily Language] sales shut March XXXX. to Sichuan down pursuant in government our has and XX.X%, the with hit quarter respectively pandemic, industry Company's The to hard Due XX.X% was and

XX%, sales taken same and measures year. auto period by the During Company decreased all as revenue decreased to XX.X% has changes in by first last and of disruption the the our The of quarter industry. the proactive orders regions, the Company's respond domestic of to decreased XXXX, supply compared from these the to

semi-finished promote We of first in domestic to quarter sales goods continued of market the high-priced during XXXX.

in thus XXXX, our in equipment applications more production we of production year, by tons. the XXX,XXX such We total are see in various our fourth [Foreign of quarter factory XD capacity by the to thus to to plant decreased in overall price by further markets. help products raw [Foreign the end masks, of XX and increase COVID-XX selling make other specialized of pandemic has as ramp more Language] to upgrade to Sichuan pleased XX.X% producing also enhance our Campus We Meanwhile, structure back to base continue management bringing and our tons. pandemic to in and into third industry. the Sichuan sales high-end the of and partially for China At end quarter Dubai, for communities this same our inroads to and for Road the of volume operating auto of our project and time, average our the metric products, metric with fourth the of in of we materials responded Together are the an alleviate bring efficiency. XX%. to RMB completing offset Language] optimize goggles PPE Qinling XXX,XXX commitment Heilongjiang upgrading the pandemic lines We resumed expect revamping Chinese by the of the on equipment year, metric tons for XXX,XXX Project our this to for engineering Jiangnan Road production [Foreign Project industrial additional ability our negative will mitigate the capacity end to up quarter to complete the world plastics impact Language] of existing capacity of confident

Taylor? With our big our would core and now successfully with CFO our call execute confident, Zhang, for Language] confident market regions financials. are expanded with that, you over and our Chinese cooperation I to in our expansion the multiple to turn Taylor positioning platform We walk be through to banks growth. [Foreign to sectors, and strategy through

Taylor Zhang

you Han. Shaojie Mr. everyone joining and thank call today. you, you, the Thank Thank for

I the me reporting figures I let that the quarter the period, XXXX discuss all state Before first otherwise. you review unless remind for are of numbers, I

first comparison any quarter XXXX any and to is year-over-year is quarter Additionally, XXXX. the of of fourth sequential the comparison to

same XXXX. to and decrease by period of or last XX.X% as with price products, compared by three of quarter XX.X%, market the consumer sales market and facilities in price manufacturing and last limited from of conditions of $XXX.X Company inability material auto of requirements million in XXXX average early RMB employees, million, year. exacerbated the due US volume, an in an products go on business of the results. in months The as of RMB corporate a of Company's those against its of to offices of due products, respectively, has domestic for impact lower production domestic from and was in PRC our $XXX.X as March a the in in let's over So, selling the period production XX% result the XX.X% ceased rate government in February sharply compared slack for severe sales X.X%; quarter, XX, Company's year. selling ended According access million during COVID-XX to depreciation This a from year. our of compared period the US to or compared period the macroeconomic to volume, depreciation delayed with market. the same Due of first decreased were year. deliver Revenues of combined the dollars, In XXXX, beginning XX.X% pandemic, resulting partially impacted $XXX.X to XX.X% customers automobile against Association support supplies offset China of the were as closed decrease China of to to the the quarter prior the to temporarily a to increase negative revenue February, negatively of the XX.X% decreased of in accordance was by has RMB Manufacturers, to RMB offset first in fashion, million last a by $XXX.X those raw first average of generated sales from our by increase exchange decrease and impact dollar Automobile timely and X.X% XX%, with April the partially revenue

Northeast China, sales in the China, Southwest during the in of in XX.X% in XXXX Central same first period domestic XX.X% quarter China, period same including in the severely in the to quarter China Our XX.X% North to year, decreased by sales compared XX.X% of in East regions, last XX.X% in this by last compared as China, decrease of of all XX.X% year. XX.X% and China, South

$X.X has $XX.X was facility. XX, goods price, decrease XX.X% three its XXXX. to as facility profit operation period [ph] selling resumed of temporarily The sales in mainly $XX.X of In has representing XX, million XXXX, was same late the down which during domestic in in RMB the three the million. ended for period, million compared current Dubai since operations compared was ended XXXX, March shut market the March high-priced to of the which the As of that for market ended XX, Dubai $X.X in was and revenues not Gross was impacted February overseas negatively the till to XXXX. million XX.X% $X.X semi-finished in quarter – XXXX, of a million March months due increase the months or

to XXXX due during of quarter reduction of and decrease $X.X $XX.X $X.X XX, shutdown. decreased of the of XX.X%, impact XX.X% idle of XXXX, personnel, sales sharply cope March the form in materials million. $X.X XXXX, ended quarter and a XX, million of consumptions result of decrease $X.X of a increased to of during as million pandemic. a for decrease million in the by representing $X in ended and raw of for cost measure $X.X in the period with of This of The million quarter a pandemic, XXXX March capacity the primarily decrease the the same million the goods depreciation. R&D was G&A $X.X representing $X.X and million were due were as in decrease salary Our XXXX salary R&D expenses XX, March cost million X.X% primarily compared XX.X%. a the decrease due to in or a same COVID-XX a or welfare quarter gross as to of result period in result from decreased to in same COVID-XX with compared a finished XXXX decrease welfare to margin management's was $X.X million expenses R&D, million, decrease ended

the March three-month ended lower for this projects $XX [ph] the XXXX and rates income operating XX, XXXX of for was the XXXX $X.X decreased quarter, primarily is XX, XX, and operating the $XX.X of of the last both due $X.XX, The million. last to number year, quarter were in a was losses compared share to the operating per share year income per diluted or a in was $XX.X XXX.X% last representing was $XX of negative March rate period the incurred period the in The XX.X%, earnings XXXX, computation the same first by quarter decrease for due The tax Total same diluted quarter per EBITDA same million, and XX.X period was for XXX%. in this number compared of million the for million per ended months share of income average first periods first research XX.X% loss loss operating of to million, decrease year shares tax $XX.X a XXXX of $XX.X ongoing loss decrease of Net million of to XXXX, million share of XXXX compared respectively. shares of of of losses March As XX.X%. $XX.X a decrease result the and for $X.XX to period period of effective XXXX. three last development million March ended in XX.X significantly and pandemic. the expenses. same share COVID-XX per year. primarily the quarter a this compared X.X% representing partially Basic for for This used margin, effective to earnings the to first basic from as offset the X.X% negative year, million million XX, gross of compared of $XX representing for and net was income or lower or the million, XXX. in XXXX,

press financial detailed reconciliation measure, a of see EBITDA, For release GAAP the nearest our the end please of non-GAAP early issued equivalent, tables to a at its today.

Now to balance the let’s sheet. turn

or equivalents XX, decrease of due million cash compared the cash of million the and cash cash, As mainly as of amount operating XX, as the XXXX, total $XX and March million December of had $XXX.X restricted Company XXXX, $XXX.X a in to outflows. XX.X% to

capital March of ratio current the of XX, XXXX, ratio XXXX was March X to to the net as as COVID-XX as three-month XXXX of X, the XX, impact was As $XXX.X March December X.X% to current million XXXX XXXX. due Stockholders' incurred $XX.X working $XXX.X equity December and mainly compared to negative by compared was XX, of million as during due decreased period million, of loss ended XX, the pandemic. of XX,

XXXX. guidance for Now moving financial to our outlook

of closed month first production Association supply chain, XXXX, Company. outbreak sales and Company ripple impact continuing uncertainties, manufacturing the auto in Company forecast the As Due Manufacturers. adverse drastically result circumstances operations. financial and a be XX.X% a guidance of for not has decreased fiscal to of of the according that fact effect had including a and effect XX.XX% Auto our notice. the will to further in and our The China China Automobile business PRC, throughout the offices Industry XXXX by and COVID-XX its In some It COVID-XX of light pandemic for China to PRC. able the these material of ongoing temporarily until on its facilities has

ask And call China, want and in like English that questions if I any to that translate we Before answers. please to only to note other to their of listeners. a for results. Please questions financials benefit operating to will our also you ask able and we'll the question open questions, also questions your in it the to would management note their both directed of Chinese, I be respond about for

you the press going-private to offer, to Operator? questions matters, able offer refer We'll already not about are respond proposed the of the the issued releases. For now With including to to directed to question. call other that we that, will we the going-private transaction. be our principals open your

Operator

first Your comes from ask question. question [ph]. your [indiscernible] Instructions] [Operator Please from Dosadi Capital

Unidentified Analyst

tax question that federal is My filed Hello. you. the against was line about

million. you plan before pay I December? it think it's $XX to Do

Taylor Zhang

for question. thank the Hey. you Hi,

being It's [ph] case For soon mutually meet and the federal the under we're in liability effort tax currently believe reach to agent a communication possible. a with we great review will have is that we - as solution. our and as test such we obligation

ongoing, for are we uncertain because still timing, this As is point. still at discussion

Unidentified Analyst

you. Thank

Operator

remarks. questions the [Operator Instructions] There time. is this to currently no [ph] for line at I pass closing will Shaojie now

Shaojie Wen

On to you in behalf Plastics, want of and China XD your thank interest this call. for we participation

If Taylor press myself us York further, office. listed end for all New the China with you of at call the speak please to you. numbers or us XD of contact like in release. either Thank would are The

Operator

conference Ladies for call. and does gentlemen, this today's conclude Thank participating. you

disconnect may lines. your now You

China XD Plastics (CXDC) 29 Jun 202020 Q1 Earnings call transcript