China United Insurance Service Reports 2015 First-Quarter Financial Results
JIANGSU, China and TAIPEI, Taiwan, May 20, 2015 /PRNewswire/ -- China United Insurance Service, Inc. (CUIS) (OTCBB: CUII), a leading insurance intermediary company with operations in the People's Republic of China, Hong Kong and Taiwan, reported financial results for the first quarter ended March 31, 2015.
The geographical distribution of CUIS' revenues for the three months ended March 31, 2015 and 2014 were as follows:
| Three months ended March 31 |
||||
| Geographical Area |
2015 |
2014 |
||
| PRC |
$ 1,245,575 |
$ 715,197 |
||
| Taiwan |
8,610,540 |
8,146,526 |
||
| $ 9,856,115 |
$ 8,861,723 |
|||
Revenues for the quarter ended March 31, 2015 increased 11% to $9.86 million from $8.86 million in the same period last year. The increase, in part, reflected higher sales due to broader and more flexible product offerings by the company's top underwriting insurance companies. Additionally, sales growth in China improved, after its relocation of headquarters to Nanjing in 2014 and expansion of branches.
Cost of revenue for the first quarter of 2015 rose 20% to $6.45 million from $5.37 million in the same period a year ago. The increase was largely due to the growth of the first-year commission (FYC) revenue within the revenue mix, as compared to the comparable period in 2014. Compared with the commission cost of other types of commission revenue, the cost of the FYC is higher.
Gross profit for the 2015 first quarter was $3.41 million versus $3.49 million for the comparable quarter in 2014. Operating expense for the 2015 first quarter was $3.42 million, compared with $2.72 million in the same quarter a year ago. The increase was mainly due to the rate of business tax directly related to sales in Taiwan subsidiaries, which increased to 5% from 2% since July 2014. The rate of the subject business tax has returned to 2% from March 2015 due to tax code reclassification for financial and insurance industries.
Net loss for the quarter ended March 31, 2015 was $92,000, compared with net income of $650,000 in the same quarter last year. Net loss attributable to CUIS' shareholders for the quarter was $281,000, or $0.01 per share, versus net income of $255,000, or $0.01 per diluted share, in the 2014 comparable quarter.
"In 2014, we moved headquarters from Henan to Nanjing, as well as built up additional branches, enabling the company to serve more customers in different provinces. The strategy to invest in our brand names is gaining traction in China, which is reflected by a 74% increase in revenues for the first quarter, compared with the prior year period," said Yi Hsiao Mao, Chairman and Chief Executive Officer. "We are continuing to explore growth opportunities, while keeping our focus on providing unparalleled customer service through highly trained professionals."
During the quarter, CUIS completed the previously announced acquisition of Genius Investment Consultant Co., which owns approximately 15% of Genius Insurance Broker Co., a leading insurance brokerage company operating throughout Taiwan.
CUIS' strategic growth objectives include continuing its M&A activities, leveraging Taiwan's operational strength and enhancing efficiencies in China, along with recruiting motivated insurance agents, improving service quality, seeking good insurance products in the market, and investing in educating its agents to help customers make well-informed decisions and retentions.
About China United Insurance Service, Inc.
China United Insurance Service, Inc. was founded in 2010 with a vision to build one of the largest financial insurance service platforms in Asia and to become a multinational enterprise by leveraging the experience of its Taiwan operations and capitalizing on China's fast-growing insurance market. CUIS offers a broad range of products and services for individuals, families, and businesses, including: brokerage services for various types of life, health, personal accident, property and casualty insurance; insurance application assistance; claims advocacy; claims accounting preparation services; disaster and loss prevention; and risk assessment/risk management consulting services and the corresponding reinsurance brokerage services.
CUIS currently operates and offers innovative insurance products in China, Hong Kong and Taiwan through its subsidiary companies. The company plans to continue with its expansion into other territories and aspires to become one of the Asia's leading financial insurance enterprises. For more information on CUIS, please visit: http://cuis.asia/.
Forward Looking Statement
Statements in this press release may be "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward- looking statements can be identified by terminology such as "will," "expects," "believes," "anticipates," "intends," "estimates" and similar statements, and involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections of CUIS and the insurance industry. Potential risks and uncertainties include, but are not limited to, those relating to CUIS' ability to attract and retain productive agents, its ability to maintain existing and develop new business relationships with insurance companies, its ability to execute its growth strategy, its ability to adapt to the evolving regulatory environment in the Chinese insurance industry, its ability to compete effectively against its competitors, and macroeconomic conditions in China and Taiwan and the potential impact on the sales of insurance products. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may, and probably will, differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including those described above and those risks discussed from time to time in the company's filings with the Securities and Exchange Commission.
(Financial statements follow)
| CHINA UNITED INSURANCE SERVICE, INC. AND SUBSIDIARIES |
|||
| CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME/(LOSS) |
|||
| FOR THE THREE-MONTHS ENDED MARCH 31, 2015 AND 2014 |
|||
| (Unaudited) |
|||
| Three-Months Ended March 31, |
|||
| 2015 (Unaudited) |
2014 (Unaudited) |
||
| Revenues |
$ 9,856,115 |
$ 8,861,723 |
|
| Cost of revenue |
6,446,411 |
5,368,225 |
|
| Gross profit |
3,409,704 |
3,493,498 |
|
| Operating expenses: |
|||
| Selling |
369,259 |
302,989 |
|
| General and administrative |
3,053,644 |
2,413,245 |
|
| Total operating expenses |
3,422,903 |
2,716,234 |
|
| Income (loss) from operations |
(13,199) |
777,264 |
|
| Other income: |
|||
| Loss on disposal of fixed assets |
4,463 |
-- |
|
| Interest income |
37,715 |
43,584 |
|
| Other-net |
8,552 |
72,944 |
|
| Total other income |
50,730 |
116,528 |
|
| Income before income taxes |
37,531 |
893,792 |
|
| Income tax expense |
129,629 |
243,600 |
|
| Net income (loss) |
(92,098) |
650,192 |
|
| Net income attributable to the noncontrolling interests |
188,568 |
394,794 |
|
| Net income (loss) attributable to parent's shareholders |
$ (280,666) |
$ 255,398 |
|
| Weighted average shares outstanding: |
|||
| Basic and diluted |
29,452,669 |
29,100,503 |
|
| Income (loss) per share: |
|||
| Basic and diluted |
(0.01) |
0.01 |
|
| CHINA UNITED INSURANCE SERVICE, INC. AND SUBSIDIARIES |
||||
| CONSOLIDATED BALANCE SHEETS |
||||
| AS OF MARCH 31, 2015 (Unaudited) AND DECEMBER 31, 2014 |
||||
| March 31, 2015 |
December 31, 2014 |
|||
| ASSETS |
(unaudited) |
|||
| Current assets |
||||
| Cash and cash equivalents |
$ 18,495,789 |
$ 19,571,799 |
||
| Marketable securities |
2,483,631 |
2,437,006 |
||
| Accounts receivable, net |
3,753,543 |
7,706,273 |
||
| Other current assets |
1,097,864 |
574,467 |
||
| Total current assets |
25,830,827 |
30,289,545 |
||
| Property, plant and equipment, net |
1,067,264 |
1,061,762 |
||
| Intangible assets |
256,970 |
270,956 |
||
| Goodwill |
2,071,491 |
31,651 |
||
| Long –term investment |
1,585,804 |
95,328 |
||
| Other assets |
843,395 |
587,522 |
||
| TOTAL ASSETS |
$ 31,655,751 |
$ 32,336,764 |
||
| LIABILITIES AND STOCKHOLDERS' EQUITY |
||||
| Current liabilities |
||||
| Taxes payable |
$ 939,829 |
$ 919,907 |
||
| Other current liabilities |
5,388,463 |
9,534,371 |
||
| Deferred tax liability |
19,195 |
37,662 |
||
| Due to related parties |
271,047 |
531,447 |
||
| TOTAL CURRENT LIABILITIES |
6,618,534 |
11,023,387 |
||
| Long-term liabilities |
7,630,255 |
7,500,645 |
||
| TOTAL LIABILITIES |
14,248,789 |
18,524,032 |
||
| COMMITMENTS AND CONTINGENCIES |
||||
| STOCKHOLDERS' EQUITY |
||||
| Preferred stock, par value $0.00001, 10,000,000 authorized, 1,000,000 issued and |
10 |
10 |
||
| Common stock, par value $0.00001, 100,000,000 authorized, 29,452,669 and |
295 |
291 |
||
| Additional paid-in capital |
8,157,512 |
4,674,593 |
||
| Statutory Reserves |
1,449,946 |
1,388,014 |
||
| Accumulated other comprehensive loss |
(256,205) |
(350,881) |
||
| Retained earnings |
1,374,678 |
1,717,278 |
||
| Stockholder's equity attribute to parent's shareholders |
10,726,236 |
7,429,305 |
||
| Non-controlling interest |
6,680,726 |
6,383,427 |
||
| TOTAL STOCKHOLDERS' EQUITY |
17,406,962 |
13,812,732 |
||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
$ 31,655,751 |
$ 32,336,764 |
||
SOURCE China United Insurance Service, Inc.
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