China Customer Relations Centers, Inc. Announces Financial Results for the Full Year 2020 as Compared to Full Year 2019
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E-mailTAI'AN, China, May 17, 2021 /PRNewswire/ -- China Customer Relations Centers, Inc. (NASDAQ: CCRC) ("CCRC" or the "Company"), a leading e-commerce and financial services business process outsourcing ("BPO") service provider in China, today announced its financial results for the year ended December 31, 2020.
Full Year of 2020 Financial Results
Revenues
For the year ended December 31, 2020, revenues increased by $66.91 million, or 38.6%, to $240.32 million from $173.41 million for the same period of the prior year. Our revenue growth in the year of 2020 resulted primarily from acquiring new customers and increased sales volumes to our existing clients.
We continued to increase our service capacity, which increased by 6,889 seats, or 30.8%, to 29,249 seats as of December 31, 2020 from 22,360 seats at the end of 2019.
Cost of revenues
Cost of revenues consists primarily of salaries, payroll taxes and employee benefits costs of our customer service associates and other operations personnel. Cost of revenues also includes direct communications costs, rent expense, IT costs, and facilities support expenses. Cost of revenues increased by $54.22 million, or 40.3%, to $188.73 million for the year ended December 31, 2020 from $134.50 million for the same period of the prior year. The increase in cost of revenues was in line with the increase in revenues. As a percentage of revenues, cost of revenues was 78.5% for the year ended December 31, 2020, compared to 77.6% for the same period of the prior year.
Gross profit and gross margin
Gross profit increased by $12.69 million, or 32.6%, to $51.59 million for the year ended December 31, 2020 from $38.90 million for the same period of the prior year. Gross margin decreased by 1.0 percentage point to 21.5% for the year ended December 31, 2020 from 22.4% for the same period of the prior year.
Selling, general and administrative expense
Selling, general and administrative ("SG&A") expenses consists primarily of sales and administrative employee-related expenses, professional fees, travel costs, research and development costs, and other corporate expenses. SG&A expenses increased by $1.45 million, or 5.5%, to $27.78 million for the year ended December 31, 2020 from $26.32 million for the same period of the prior year. As a percentage of revenues, SG&A expenses decreased from 15.2% for the year ended December 31, 2019 to 11.6% for the year ended December 31, 2020.
Operating income and operating margin
Income from operations increased by $11.23 million, or 89.2%, to $23.82 million for the year ended December 31, 2020 from $12.59 million for the same period of the prior year. The increase in operating income was related to increased gross profit which was partially offset by increased SG&A expenses. Operating margin was 9.9% for the year ended December 31, 2020, compared to 7.3% for the same period of the prior year.
Other income
We recognized government grants, which are discretionary and unpredictable in nature, of $2.99 million during the year ended December 31, 2020, compared to $1.83 million recognized during the same period of the prior year. Total other income, net of other expenses, increased by $1.20 million, or 40.4%, to $4.18 million for the year ended December 31, 2020 from $2.98 million for the same period of the prior year.
Income before provision for income taxes
Income before provision for income taxes increased by $12.44 million, or 79.9%, to $28.00 million for the year ended December 31, 2020 from $15.57 million for the same period of the prior year. The increase in income before provision for income taxes was due to increased operating income as well as government grants and other income.
Income taxes
Provision for income taxes was $3.07 million for the year ended December 31, 2020, compared to $2.39 million for the same period of the prior year.
Net income and earnings per share
Net income increased by $11.76 million, or 89.2%, to $24.93 million for the year ended December 31, 2020 from $13.17 million for the same period of the prior year. After deducting net income attributable to noncontrolling interest, net income attributable to common shareholders was $24.86 million, or $1.36 per basic and diluted share, for the year ended December 31, 2020, compared to $13.06 million, or $0.71 per basic and diluted share, for the same period of the prior year.
Financial Conditions
As of December 31, 2020, the Company had cash of $43.67 million, compared to $25.33 million at December 31, 2019. Total working capital was $74.06 million as of December 31, 2020, compared to $47.50 million at the end of 2019.
Net cash provided by operating activities was $24.05 million for the year ended December 31, 2020, compared to $5.21 million for the same period of the prior year. Net cash used in investing activities was $5.54 million for the year ended December 31, 2020, compared to $4.46 million for the same period of the prior year. Net cash used in financing activities was $2.66 million for the year ended December 31, 2020, compared to net cash provided by financing activities of $0.54 million for the same period of the prior year.
Notice
Rounding amounts and percentages: Certain amounts and percentages included in this press release have been rounded for ease of presentation. Percentage figures included in this press release have not in all cases been calculated on the basis of such rounded figures, but on the basis of such amounts prior to rounding. For this reason, certain percentage amounts in this press release may vary from those obtained by performing the same calculations using the figures in the financial statements. In addition, certain other amounts that appear in this press release may not sum due to rounding.
About China Customer Relations Centers, Inc.
The Company is a leading BPO service provider in China focusing on the complex, voice-based and online-based segments of customer care services, including:
- customer relationship management;
- technical support;
- sales;
- customer retention;
- marketing surveys; and
- research.
The Company's service is currently delivered in Provinces of Shandong, Jiangsu, Liaoning, Guangdong, Yunnan, Hubei, Sichuan, Hebei, Anhui, Xinjiang, Guangxi, Jiangxi, Heilongjiang, and Chongqing. More information about the Company can be found at: www.ccrc.com.
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. Specifically, the Company's statements regarding its growth, shareholder returns and business outlook, are forward-looking statements. Forward-looking statements are not guarantee 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; product and service demand and acceptance; changes in technology; economic conditions; the growth of the call center business process outsourcing market in China; reputation and brand; the impact of competition and pricing; 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 Securities and Exchange Commission. 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 U.S. Securities and Exchange Commission, 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:
Sherry Zheng Weitian Group LLCEmail: [email protected] Phone: +1-718-213-7386
CHINA CUSTOMER RELATIONS CENTERS, INC. AND SUBSIDIARIES | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
December 31, | December 31, | |||||||
2020 | 2019 | |||||||
ASSETS | ||||||||
Cash and cash equivalents | $ | 43,669,538 | $ | 25,328,486 | ||||
Accounts receivable | 63,493,891 | 42,606,485 | ||||||
Prepayments | 2,352,988 | 2,396,646 | ||||||
Prepayment, related parties | 359,142 | 90,429 | ||||||
Due from related parties, current | 470,076 | - | ||||||
Income taxes recoverable | 104,721 | 712,459 | ||||||
Other current assets | 4,420,220 | 3,408,704 | ||||||
Total current assets | 114,870,576 | 74,543,209 | ||||||
Equity investments | 3,678,171 | 3,446,346 | ||||||
Property and equipment, net | 12,543,156 | 10,115,782 | ||||||
Deferred tax assets | 259,200 | 242,863 | ||||||
Due from related party, non-current | - | 215,307 | ||||||
Operating lease right-of-use assets | 12,265,679 | 9,827,114 | ||||||
Operating lease right-of-use assets - related party | 341,078 | 172,121 | ||||||
Total non-current assets | 29,087,284 | 24,019,533 | ||||||
Total assets | $ | 143,957,860 | $ | 98,562,742 | ||||
LIABILITIES AND EQUITY | ||||||||
Accounts payable | $ | 4,315,457 | $ | 2,602,972 | ||||
Accounts payable - related parties | 260,790 | 149,658 | ||||||
Accrued liabilities and other payables | 11,018,516 | 4,641,892 | ||||||
Deferred revenue | 1,196,659 | 456,331 | ||||||
Wages payable | 15,663,312 | 10,472,596 | ||||||
Income taxes payable | 974,510 | 452,961 | ||||||
Operating lease liabilities, current | 5,678,812 | 3,797,069 | ||||||
Operating lease liabilities - related party, current | 165,734 | 163,995 | ||||||
Short-term loans | 1,531,933 | 4,306,138 | ||||||
Total current liabilities | 40,805,723 | 27,043,612 | ||||||
Operating lease liabilities, non-current | 7,461,337 | 6,068,702 | ||||||
Operating lease liabilities – related party, non-current | 175,002 | - | ||||||
Total non-current liabilities | 7,636,339 | 6,068,702 | ||||||
Total liabilities | 48,442,062 | 33,112,314 | ||||||
Equity | ||||||||
Common shares, $0.001 par value, 100,000,000 shares authorized, 18,329,600 shares issued and outstanding as of December 31, 2020 and December 31, 2019 | 18,330 | 18,330 | ||||||
Additional paid-in capital | 18,424,483 | 15,074,267 | ||||||
Retained earnings | 66,854,353 | 47,347,781 | ||||||
Statutory reserves | 7,761,226 | 5,818,330 | ||||||
Accumulated other comprehensive income (loss) | 2,457,406 | (3,411,744) | ||||||
Total China Customer Relations Centers, Inc. shareholders' equity | 95,515,798 | 64,846,964 | ||||||
Noncontrolling interest | - | 603,464 | ||||||
Total equity | 95,515,798 | 65,450,428 | ||||||
Total liabilities and equity | $ | 143,957,860 | $ | 98,562,742 | ||||
CHINA CUSTOMER RELATIONS CENTERS, INC. AND SUBSIDIARIES | ||||||||||||
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | ||||||||||||
For The Years Ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Revenues, net | $ | 240,316,024 | $ | 173,409,113 | $ | 141,433,641 | ||||||
Cost of revenues | 188,725,246 | 134,504,540 | 102,567,896 | |||||||||
Gross profit | 51,590,778 | 38,904,573 | 38,865,745 | |||||||||
Operating expenses: | ||||||||||||
Selling, general & administrative expenses | 27,772,891 | 26,318,771 | 21,329,908 | |||||||||
Total operating expenses | 27,772,891 | 26,318,771 | 21,329,908 | |||||||||
Income from operations | 23,817,887 | 12,585,802 | 17,535,837 | |||||||||
Interest expense | (176,422) | (190,808) | (404,958) | |||||||||
Government grants | 2,989,897 | 1,825,402 | 1,709,297 | |||||||||
Other income | 1,803,014 | 1,547,788 | 552,205 | |||||||||
Other expense | (434,048) | (202,688) | (124,370) | |||||||||
Total other income | 4,182,441 | 2,979,694 | 1,732,174 | |||||||||
Income before provision for income taxes | 28,000,328 | 15,565,496 | 19,268,011 | |||||||||
Income tax provision | 3,069,477 | 2,391,371 | 2,966,880 | |||||||||
Net income | 24,930,851 | 13,174,125 | 16,301,131 | |||||||||
Less: net income attributable to noncontrolling interest | 70,052 | 118,114 | 208,593 | |||||||||
Net income attributable to China Customer Relations Centers, Inc. | $ | 24,860,799 | 13,056,011 | 16,092,538 | ||||||||
Comprehensive income | ||||||||||||
Net income | $ | 24,930,851 | $ | 13,174,125 | $ | 16,301,131 | ||||||
Other comprehensive income (loss) | ||||||||||||
Foreign currency translation adjustment | 5,855,857 | (828,331) | (2,741,283) | |||||||||
Total Comprehensive income | 30,786,708 | 12,345,794 | 13,559,848 | |||||||||
Less: Comprehensive income attributable to noncontrolling interest | 56,759 | 109,238 | 140,467 | |||||||||
Comprehensive income attributable to China Customer Relations Centers, Inc. | $ | 30,729,949 | $ | 12,236,556 | $ | 13,419,381 | ||||||
Earnings per share attributable to China Customer Relations Centers, Inc. | ||||||||||||
Basic | $ | 1.36 | $ | 0.71 | $ | 0.88 | ||||||
Diluted | $ | 1.36 | $ | 0.71 | $ | 0.88 | ||||||
Weighted average common shares outstanding | ||||||||||||
Basic | 18,329,600 | 18,329,600 | 18,329,600 | |||||||||
Diluted | 18,329,600 | 18,329,600 | 18,329,600 | |||||||||
CHINA CUSTOMER RELATIONS CENTERS, INC. AND SUBSIDIARIES | ||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||
For The Years Ended December 31, | ||||||||||||
2020 | 2019 | 2018 | ||||||||||
Cash flows from operating activities | ||||||||||||
Net income | $ | 24,930,851 | $ | 13,174,125 | $ | 16,301,131 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
Depreciation | 4,070,582 | 3,404,912 | 2,635,242 | |||||||||
Allowance for credit losses | - | - | 952,439 | |||||||||
Loss on disposal of property and equipment | 59,366 | 19,091 | 34,166 | |||||||||
Deferred income taxes | - | 238,883 | (196,909) | |||||||||
Non-cash lease expense | 4,319,670 | 3,501,753 | - | |||||||||
Changes in operating lease right-of-use assets and operating lease liabilities upon lease modification | 634,328 | - | - | |||||||||
Changes in assets and liabilities: | ||||||||||||
Accounts receivable | (17,048,770) | (13,057,615) | (7,937,804) | |||||||||
Due from related parties | (9,929) | - | - | |||||||||
Prepayments | (298,525) | (2,097,963) | (887,778) | |||||||||
Prepayments, related parties | (248,456) | - | (95,244) | |||||||||
Other current assets | (740,237) | (1,510,847) | (970,199) | |||||||||
Operating lease liabilities | (3,955,614) | (3,037,030) | - | |||||||||
Accounts payable | 1,454,416 | 2,017,431 | 147,818 | |||||||||
Accounts payable - related parties | 95,611 | (10,440) | 122,630 | |||||||||
Wages payable | 4,245,097 | 3,511,093 | 1,884,440 | |||||||||
Income taxes recoverable | 620,277 | (192,965) | (548,893) | |||||||||
Income taxes payable | 464,576 | 94,336 | (153,896) | |||||||||
Deferred revenue | 671,332 | 100,245 | (221,771) | |||||||||
Accrued liabilities and other payables | 4,934,855 | (941,772) | 1,077,098 | |||||||||
Net cash provided by operating activities | 24,049,979 | 5,213,237 | 12,142,470 | |||||||||
Cash flows from investing activities | ||||||||||||
Purchase of property and equipment | (5,334,709) | (4,481,450) | (4,768,139) | |||||||||
Proceeds from sale of property and equipment | 7,179 | 36,693 | 9,197 | |||||||||
Advance to equity investee | (435,445) | - | (1,461) | |||||||||
Collection from equity investee | 429,068 | - | - | |||||||||
Advance to related parties | (381,309) | (214,111) | (105,827) | |||||||||
Repayment from related parties | 171,179 | 198,017 | 117,802 | |||||||||
Net cash used in investing activities | (5,544,037) | (4,460,851) | (4,748,428) | |||||||||
Cash flows from financing activities | ||||||||||||
Contribution from noncontrolling investor in subsidiary | 108,970 | - | - | |||||||||
Dividend distributed to noncontrolling investor in subsidiary | - | (213,722) | (355,232) | |||||||||
Borrowings from short-term loans | 4,351,712 | 4,452,368 | 3,891,596 | |||||||||
Repayment of short-term loans | (7,124,316) | (3,694,345) | (3,625,448) | |||||||||
Net cash provided by (used in) financing activities | (2,663,634) | 544,301 | (89,084) | |||||||||
Effect of exchange rate changes on cash and cash equivalents | 2,498,744 | (388,113) | (1,513,411) | |||||||||
Net change in cash and cash equivalents | 18,341,052 | 908,574 | 5,791,547 | |||||||||
Cash and cash equivalents, beginning of the year | 25,328,486 | 24,419,912 | 18,628,365 | |||||||||
Cash and cash equivalents, end of the year | $ | 43,669,538 | $ | 25,328,486 | $ | 24,419,912 | ||||||
Supplemental cash flow information | ||||||||||||
Interest paid | $ | 175,811 | $ | 190,808 | $ | 404,958 | ||||||
Income taxes paid | $ | 2,924,643 | $ | 2,993,733 | $ | 3,929,237 | ||||||
Non-cash investing and financing activities | ||||||||||||
Transfer from prepayments to property and equipment | $ | 705,933 | $ | 904,309 | $ | 392,637 | ||||||
Liabilities assumed in connection with purchase of property and equipment | $ | 7,200 | $ | 24,512 | $ | 88,112 | ||||||
Liability assumed in connection with acquisition of noncontrolling interest | $ | 830,308 | $ | - | $ | - | ||||||
Operating lease right-of-use assets obtained in exchange for operating lease liability | $ | 7,069,165 | $ | 5,496,939 | $ | - | ||||||
View original content:http://www.prnewswire.com/news-releases/china-customer-relations-centers-inc-announces-financial-results-for-the-full-year-2020-as-compared-to-full-year-2019-301292438.html
SOURCE China Customer Relations Centers, Inc.
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